Palawan Council V Lim

8/8/2019 SUPREME COURT REPORTS ANNOTATED VOLUME 801

G.R. No. 183173. August 24, 2016.*

THE CHAIRMAN and EXECUTIVE DIRECTOR,
PALAWAN COUNCIL FOR SUSTAINABLE
DEVELOPMENT, and THE PALAWAN COUNCIL FOR
SUSTAINABLE DEVELOPMENT, petitioners, vs.
EJERCITO LIM, doing business as BONANZA AIR
SERVICES, as represented by his Attorney-in-Fact, CAPT.
ERNESTO LIM, respondent.
Administrative Agencies; Administrative agencies possess two

(2) kinds of powers, the quasi-legislative or rule-making power,
and the quasi-judicial or administrative adjudicatory power.—
Administrative agencies possess two kinds of powers, the quasi-
legislative or rule-making power, and the quasi-judicial or
administrative adjudicatory power.
Same; The quasi-legislative power is the power to make rules
and regulations that results in delegated legislation that is within
the confines of the granting statute and the doctrine of non-
delegability and separability of powers.—The first is the power to
make rules and regulations that results in delegated legislation
that is within the confines of the granting statute and the
doctrine of non-delegability and separability of powers.
Same; The quasi-judicial power is the power to hear and
determine questions of fact to which the legislative policy is to
apply and to decide in accordance with the standards laid down
by the law itself in enforcing and administering the same law.—
The second is the power to hear and determine questions of fact to
which the legislative policy is to apply and to decide in accordance
with the standards laid down by the law itself in enforcing and
administering the same law.
Same; The Regional Trial Court (RTC) has jurisdiction to
pass upon the validity or constitutionality of a rule or regulation
issued by an administrative agency in the performance of its quasi-
www.central.com.ph/sfsreader/session/0000016c70d5bbdf29a142b1003600fb002c009e/t/?o=False 1/15
legislative functions.—The Court has categorically observed in

Smart Commu-
_______________
* FIRST DIVISION.

305
VOL. 801, AUGUST 24, 2016 305

Chairman and Executive Director, Palawan Council for
Sustainable Development vs. Lim
nications, Inc. (SMART) v. National Telecommunications

Commission (NTC), 408 SCRA 678 (2003), that if what is being
assailed is the validity or constitutionality of a rule or regulation
issued by an administrative agency in the performance of its
quasi-legislative functions, then the Regional Trial Court has
jurisdiction to pass upon the same. The determination of whether
a specific rule or set of rules issued by an administrative agency
contravenes the law or the Constitution is within the jurisdiction
of the Regional Trial Court.
Same; Prohibition; A petition for prohibition is not the proper
remedy to assail an administrative order issued in the exercise of a
quasi-legislative function.—We also need to remind that a petition
for prohibition is not the proper remedy to assail an
administrative order issued in the exercise of a quasi-legislative
function. Prohibition is an extraordinary writ directed against any
tribunal, corporation, board, officer or person, whether exercising
judicial, quasi-judicial or ministerial functions, ordering said
entity or person to desist from further proceedings when said
proceedings are without or in excess of said entity’s or person’s
jurisdiction, or are accompanied with grave abuse of discretion,
and there is no appeal or any other plain, speedy and adequate
remedy in the ordinary course of law.
Same; Same; Petition for prohibition lies against the exercise
of judicial or ministerial functions, not against the exercise of
legislative or quasi-legislative functions.—Its lies against the
exercise of judicial or ministerial functions, not against the
exercise of legislative or quasi-legislative functions. Generally, the
purpose of the writ of prohibition is to keep a lower court within
the limits of its jurisdiction in order to maintain the
administration of justice in orderly channels.
Remedial Law; In proper cases, the rigidity of procedural

rules may be relaxed or suspended in the interest of substantial
justice.—In proper cases, indeed, the rigidity of procedural rules
may be relaxed or suspended in the interest of substantial justice.
The power of the Court to except a particular case from its rules
whenever the purposes of justice so require cannot be questioned.
PETITION for review on certiorari of a decision of the

Court of Appeals.

306
306 SUPREME COURT REPORTS ANNOTATED

The facts are stated in the opinion of the Court.

Cortel Law Office for respondent.
BERSAMIN, J.:

This appeal seeks the reversal of the decision
promulgated on May 28, 2008,1 whereby the Court of
Appeals (CA) granted the petition for prohibition of the
respondent,2 and enjoined the petitioners from enforcing
Administrative Order (A.O.) No. 00-05, Series of 2002;
Resolution No. 03-211; any and all of their revisions; and
the Notice of Violation and Show Cause Order for being
null and void.

Antecedents

Petitioners Executive Director and Chairman of the
Palawan Council for Sustainable Development (PCSD),
Messrs. Winston G. Arzaga and Vicente A. Sandoval,
respectively, were the public officials tasked with the duty
of executing and implementing A.O. No. 00-05 and the
Notice of Violation and Show Cause Order, while the PCSD
was the government agency responsible for the governance,
implementation, and policy direction of the Strategic
Environment Plan (SEP) for Palawan. On the other hand,
the respondent was the operator of a domestic air carrier
doing business under the name and style Bonanza Air
Services, with authority to engage in nonscheduled air taxi
transportation of passengers and cargo for the public. His
business operation was primarily that of transporting live

fish from Palawan to fish traders.3
_______________
1 Rollo, pp. 42-60; penned by Associate Justice Normandie B. Pizarro,

and concurred in by Associate Justices Josefina Guevara-Salonga
(retired), and Magdangal M. De Leon.
2 Id., at pp. 201-222.
3 Id., at pp. 43-44.

307
VOL. 801, AUGUST 24, 2016 307

The PCSD issued A.O. No. 00-05 on February 25, 2002

to ordain that the transport of live fish from Palawan
would be allowed only through traders and carriers who
had sought and secured accreditation from the PCSD. On
September 4, 2002, the Air Transportation Office (ATO)
sent to the PCSD its communication to the effect that ATO-
authorized carriers were considered common carriers, and,
as such, should be exempt from the PCSD accreditation
requirement. It attached to the communication a list of its
authorized carriers, which included the respondent’s air
transport service.4
The respondent asserted that he had continued his trade
without securing the PCSD-required accreditation; that the
PCSD Chairman had started harassing his clients by
issuing Memorandum Circular No. 02, Series of 2002,
which contained a penal clause imposing sanctions on the
availment of transfer services by unaccredited aircraft
carriers such as cancellation of the PCSD accreditation and
perpetual disqualification from engaging in live fish
trading in Palawan; that due to the serious effects of the
memorandum, the respondent had sent a grievance letter
to the Office of the President; and that the PCSD
Chairman had nonetheless maintained that the
respondent’s business was not a common carrier, and
should comply with the requirement for PCSD
accreditation.
In disregard of the prohibition, the respondent
continued his business operation in Palawan until a
customer showed him the Notice of Violation and Show

Cause Order issued by the PCSD to the effect that he had
still made 19 flights in October 2002 despite his failure to
secure accreditation from the PCSD; and that he should
explain his actuations within 15 days, otherwise, he would
be sanctioned with a fine of P50,000.00.5
_______________
4 Id., at p. 44.
5 Id., at p. 45.

308

According to the respondent, he had not received the

Notice of Violation and Show Cause Order.6
The respondent filed a petition for prohibition in the CA,
which issued a temporary restraining order (TRO) upon his
application after finding that there were sufficient grounds
to issue the TR0.7 After the petitioners did not file their
comment despite notice, the CA issued the writ of
preliminary injunction upon his posting of the injunction
bond for P50,000.00.8
The petitioners countered that the petition for
prohibition should have been dismissed because A.O. No.
00-05 was in accord with the mandate of the Constitution
and of Republic Act No. 7611 (Strategic Environmental
Plan for Palawan Act);9 that Resolution No. 03-211 had
meanwhile amended or repealed portions of A.O. No. 00-05,
thereby rendering the issues raised by the petition for
prohibition moot and academic;10 that by virtue of such
developments, the PCSD accreditation was now required
for all carriers, except those belonging to the Government;
that on August 18, 2003, the respondent had received
another notice regarding the enactment of Resolution No.
03-211; and that they had subsequently dispatched to the
respondent on September 9, 2003 another show cause order
in view of his continued noncompliance with Resolution No.
03-211.11
The salient portions of Resolution No 03-211 read:
SECTION 3. A new Paragraph 1.5 is hereby added to

Section 1 of Administrative Order No. 00-05, as amended, as
follows:
_______________
6 Id.
7 Id., at p. 47.
8 Id.
9 Approved on June 19, 1992.
10 Rollo, p. 47.
11 Id., at p. 49.

309
VOL. 801, AUGUST 24, 2016 309

“CARRIER — any natural or juridical person or entity,

except the Government, that is engaged or involved in the
transportation of live fish or any other aquatic fresh or
saltwater products, whether or not on a daily or regular
manner or schedule and whether or not for compensation,
from any point within or out of the Province of Palawan
under a contract or transportation, whether or not in
writing, through the use of aircrafts, seacrafts, land vehicles
or any other mode of transportation, whether or not
registered, mechanical or motorized in nature, and whether
or not such persons or entities are common carriers or not
as defined by law and regardless of the place of registration
of such persons or entities as well as the crafts and vehicles
used or employed by them.”
x x x x
SECTION 5. The new Section 2 for Administrative Order

No. 00-05, as amended, shall read as follows:
“Section 2. Accreditation.—Before it can proceed

with the transport or carriage of live fish or any other
aquatic fresh or saltwater products within or out of the
Province of Palawan, a CARRIER must secure a
CERTIFICATE OF ACCREDITATION from the PCSD.”12
The respondent then filed a supplemental petition

alleging that due to the implementation of Resolution No.
03-211, his carriers were forbidden to transport or deliver
fish from Palawan to his clients resulting in loss of income
amounting to P132,000.00; and that such supervening
event was a mere scheme to circumvent the TRO and the
writ of preliminary injunction issued by the CA.
_______________
12 Id., at p. 245.

310

As stated, the CA promulgated its assailed decision on

May 28, 2008, disposing as follows:
WHEREFORE, the instant petition is GRANTED.

Administrative Order No. 00-05, Series of 2002, Resolution
No. 03-211, and any and all of its revisions, and the Notice of
Violation and Show-Cause Order are declared NULL and
VOID. The injunctive writ previously issued by this Court
prohibiting the Respondents from implementing or enforcing the
said issuance(s) is declared PERMANENT. Costs against the
Respondents.
SO ORDERED.13

Hence, this appeal by the petitioners.

Issue

The sole issue for determination is whether or not the
CA erred in declaring A.O. No. 00-05, Series of 2002;
Resolution No. 03-211; and the Notice of Violation and
Show Cause Order null and void for having been issued in
excess of the PCSD’s authority.
The petitioners submit the following grounds for
consideration, to wit:

I.
THE COURT OF APPEALS ERRED IN INTERPRETING

SECTIONS 4, 6, 16, AND 19 OF RA 7611 AS LIMITATIONS TO
THE POWER OF THE PCSD TO PROMULGATE
ADMINISTRATIVE ORDER NO. 00-05.

II.
THE COURT OF APPEALS ERRED IN HOLDING THAT THE
PCSD’S ISSUANCE OF ADMINISTRATIVE ORDER NO. 05 (sic)
IS AN ENCROACHMENT OF THE LEGISLATIVE FUNCTION
OF THE SANGGUNIANG PANLALAWIGAN OF PALAWAN.
_______________
13 Id., at p. 60.

311
VOL. 801, AUGUST 24, 2016 311

A. ADMINISTRATIVE ORDER NO. 00-05 AND ITS

REVISIONS WERE PROMULGATED PURSUANT TO
THE RULE-MAKING POWER OF THE PCSD.

B. ADMINISTRATIVE ORDER NO. 00-05 AND ITS
REVISIONS POSSESS ALL THE REQUISITES OF A
VALID ADMINISTRATIVE REGULATION.

III
THE COURT OF APPEALS ERRED IN RULING THAT THE
PROMULGATION OF ADMINISTRATIVE ORDER NO. 00-05
AND ITS REVISIONS IS VESTED SOLELY IN THE
SANGGUNIANG PANLALAWIGAN OF PALAWAN.14

Ruling of the Court

We grant the petition for review on certiorari, and
reverse the decision of the CA

1.
Procedural Matters

We first deal with the propriety of the petition for
prohibition for the purpose of annulling the challenged
administrative issuances.
Administrative agencies possess two kinds of powers,
the quasi-legislative or rule-making power, and the quasi-
judicial or administrative adjudicatory power. The first is
the power to make rules and regulations that results in
delegated legislation that is within the confines of the
granting statute and
_______________
14 Id., at pp. 21-22.

312

the doctrine of non-delegability and separability of

powers.15 The issuance of the assailed A.O. No. 00-05,
Resolution. No. 03-211 and the other issuances by the
PCSD was in the exercise of the agency’s quasi-legislative
powers. The second is the power to hear and determine
questions of fact to which the legislative policy is to apply
and to decide in accordance with the standards laid down
by the law itself in enforcing and administering the same
law. The administrative body exercises its quasi-judicial
power when it performs in a judicial manner an act that is
essentially of an executive or administrative nature, where
the power to act in such manner is incidental to or
reasonably necessary for the performance of the executive
or administrative duty entrusted to it.16
The challenge being brought by the petitioners rests
mainly on the theory that the CA should not have
interpreted the functions of the PCSD, particularly those
provided for in Sections 4, 6, 16, and 19 of R.A. No. 7611, as
limitations on the power of the PCSD to promulgate A.O.
No. 00-05. Clearly, what was assailed before the CA was
the validity or constitutionality of a rule or regulation
issued by the PCSD as an administrative agency in the
performance of its quasi-legislative function. The question
thus presented was a matter incapable of pecuniary
estimation, and exclusively and originally pertained to the
proper Regional Trial Court pursuant to Section 19(1) of
Batas Pambansa Blg. 129. Indeed, Section 1, Rule 63 of the
Rules of Court expressly states that any person “whose

rights are affected by a statute, executive order or
regulation, ordinance, or any other governmental
regulation” may bring an action in the appropriate
Regional Trial Court “to determine any question of
construction or validity arising, and for a declaration of his
rights or duties, thereunder.” The judicial course to raise
the issue against
_______________
15 Smart Communications, Inc. (SMART) v. National

Telecommunications Commission (NTC), G.R. No. 151908 and G.R. No.
152063, August 12, 2003, 408 SCRA 678, 686.
16 Id., at p. 687.

313
VOL. 801, AUGUST 24, 2016 313

such validity should have adhered to the doctrine of

hierarchy of courts except only if the respondent had
sufficient justification to do otherwise. Yet, he utterly failed
to show justification to merit the exception of bypassing the
Regional Trial Court. Moreover, by virtue of Section 5,
Article VIII of the Constitution,17 the Court’s power to
evaluate the validity of an implementing rule or regulation
is generally appellate in nature.
In this regard, the Court has categorically observed in
Smart Communications, Inc. (SMART) v. National
Telecommunications Commission (NTC)18 that if what is
being assailed is the validity or constitutionality of a rule
or regulation issued by an administrative agency in the
performance of its quasi-legislative functions, then the
Regional Trial Court has jurisdiction to pass upon the
same. The determination of whether a specific rule or set of
rules issued by an administrative agency contravenes the
law or the Constitution is within the jurisdiction of the
Regional Trial Court.19
To accord with the doctrine of hierarchy of courts,
therefore, the petition for prohibition should have been
originally brought in the proper Regional Trial Court as a
petition for declaratory relief.
We also need to remind that a petition for prohibition is

not the proper remedy to assail an administrative order
issued in
_______________
17 The Supreme Court shall have the following powers:

x x x x
(2) Review, revise, reverse, modify, or affirm on appeal or certiorari,
as the law or the Rules of Court may provide, final judgments and
orders of lower courts in:
(a) All cases in which the constitutionality or validity of any
treaty, international or executive agreement, law,
presidential decrees, proclamation, order, instruction,
ordinance, or regulation is in question. x x x
18 Supra note 15.
19 Id., at p. 689.

314

the exercise of a quasi-legislative function. Prohibition is

an extraordinary writ directed against any tribunal,
corporation, board, officer or person, whether exercising
judicial, quasi-judicial or ministerial functions, ordering
said entity or person to desist from further proceedings
when said proceedings are without or in excess of said
entity’s or person’s jurisdiction, or are accompanied with
grave abuse of discretion, and there is no appeal or any
other plain, speedy and adequate remedy in the ordinary
course of law.20 Its lies against the exercise of judicial or
ministerial functions, not against the exercise of legislative
or quasi-legislative functions. Generally, the purpose of the
writ of prohibition is to keep a lower court within the limits
of its jurisdiction in order to maintain the administration of
justice in orderly channels.21 In other words, prohibition is
the proper remedy to afford relief against usurpation of
jurisdiction or power by an inferior court, or when, in the
exercise of jurisdiction in handling matters clearly within
its cognizance the inferior court transgresses the bounds
prescribed to it by the law, or where there is no adequate
remedy available in the ordinary course of law by which

such relief can be obtained.22
Nevertheless, the Court will not shirk from its duty to
rule on this case on the merits if only to facilitate its speedy
resolution. In proper cases, indeed, the rigidity of
procedural rules may be relaxed or suspended in the
interest of substantial justice. The power of the Court to
except a particular case from its rules whenever the
purposes of justice so require cannot be questioned.23
_______________
20 Section 2, Rule 65 of the Rules of Court.

21 Holy Spirit Homeowners Association, Inc. v. Defensor, G.R. No.
163980, August 3, 2006, 497 SCRA 581, 595.
22 Id., citing David v. Rivera, G.R. Nos. 139913 and 140159, January
16, 2004, 420 SCRA 90, 100.
23 Id., at p. 596.

315
VOL. 801, AUGUST 24, 2016 315

2.
Substantive Matters

Were A.O. No. 00-05, Series of 2002; Resolution No. 03-
211; and the Notice of Violation and Show Cause Order
null and void for having been issued in excess of the
PCSD’s authority?
We answer the query in the negative.
R.A. No. 7611 has adopted the Strategic Environmental
Plan (SEP) for Palawan consistent with the declared policy
of the State to protect, develop, and conserve its natural
resources. The SEP is a comprehensive framework for the
sustainable development of Palawan to protect and
enhance the Province’s natural resources and endangered
environment.
Towards this end, the PCSD was established as the
administrative machinery for the SEP’s implementation.
The creation of the PCSD has been set forth in Section 16
of R.A. No. 7611, to wit:
SEC. 16. Palawan Council for Sustainable

Development.—The governance, implementation and policy
direction of the Strategic Environmental Plan shall be exercised
by the herein created Palawan Council for Sustainable
Development (PCSD), hereinafter referred to as the Council,
which shall be under the Office of the President. x x x

The functions of the PCSD are specifically enumerated
in Section 19 of R.A. No. 7611, which relevantly provides:
SEC. 19. Powers and Functions.—In order to successfully

implement the provisions of this Act, the Council is hereby vested
with the following powers and functions:

1. Formulate plans and policies as may be necessary to
carry out the provisions of this Act;

2. Coordinate with the local governments to ensure that the
latter’s plans, programs and

316

projects are aligned with the plans, programs and policies of

the SEP;

3. Call on any department, bureau, office, agency or
instrumentality of the Government, and on private entities
and organizations for cooperation and assistance in the
performance of its functions;

4. Arrange, negotiate for, and accept donations, grants,
gifts, loans, and other funding from domestic and foreign
sources to carry out the activities and purposes of the SEP;

5. Recommend to the Congress of the Philippines such
matters that may require legislation in support of the
objectives of the SEP;

6. Delegate any or all of its powers and functions to its
support staffs, as hereinafter provided, except those which
by provisions of law cannot be delegated;

7. Establish policies and guidelines for employment on the
basis of merit, technical competence and moral character
and prescribe a compensation and staffing pattern;

8. Adopt, amend and rescind such rules and
regulations and impose penalties therefor for the
effective implementation of the SEP and the other
provisions of this Act;

9. Enforce the provisions of this Act and other existing laws,
rules and regulations similar to or complementary with this
Act;

10. Perform related functions which shall promote the
development, conservation, management, protection, and
utilization of the natural resources of Palawan; and

11. Perform such other powers and functions as may be
necessary in carrying out its functions, powers, and the
provisions of this Act. (Emphasis supplied)

317
VOL. 801, AUGUST 24, 2016 317

Accordingly, the PCSD had the explicit authority to fill

in the details as to how to carry out the objectives of R.A.
No. 7611 in protecting and enhancing Palawan’s natural
resources consistent with the SEP. In that task, the PCSD
could establish a methodology for the effective
implementation of the SEP. Moreover, the PCSD was
expressly given the authority to impose penalties and
sanctions in relation to the implementation of the SEP and
the other provisions of R.A. No. 7611. As such, the PCSD’s
issuance of A.O. No. 00-95 and Resolution No. 03-211 was
well within its statutory authority.
WHEREFORE, the Court GRANTS the petition for
review on certiorari; ANNULS and SETS ASIDE the
decision promulgated on May 28, 2008; DECLARES
VALID and EFFECTIVE Administrative Order No. 00-05,
Series of 2002; Resolution No. 03-211; and all their
revisions, as well as the Notice of Violation and Show
Cause Order issued to the respondent; LIFTS the

permanent injunction issued by the Court of Appeals
enjoining petitioner Palawan Council for Sustainable
Development from enforcing Administrative Order No. 00-
05, Series of 2002; Resolution No. 03-211; and all their
revisions, as well as the Notice of Violation and Show
Cause Order issued to the respondent; and ORDERS the
respondent to pay the costs of suit.
SO ORDERED.
Sereno (CJ., Chairperson), Leonardo-De Castro, Perlas-

Bernabe and Caguioa, JJ., concur.
Petition granted, judgment annulled and set aside.
Note.—The doctrine of primary jurisdiction precludes

the courts from resolving a controversy over which
jurisdiction has initially been lodged with an
administrative body of special competence. (Fajardo vs.
Flores, 610 SCRA 167 [2010])

——o0o——
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8/8/2019 SUPREME COURT REPORTS ANNOTATED VOLUME 801

G.R. No. 183173. August 24, 2016.*

Administrative Agencies; Administrative agencies possess two

legislative functions.—The Court has categorically observed in

VOL. 801, AUGUST 24, 2016 305

nications, Inc. (SMART) v. National Telecommunications

Remedial Law; In proper cases, the rigidity of procedural

PETITION for review on certiorari of a decision of the

306 SUPREME COURT REPORTS ANNOTATED

The facts are stated in the opinion of the Court.

business operation was primarily that of transporting live

1 Rollo, pp. 42-60; penned by Associate Justice Normandie B. Pizarro,

VOL. 801, AUGUST 24, 2016 307

The PCSD issued A.O. No. 00-05 on February 25, 2002

customer showed him the Notice of Violation and Show

308 SUPREME COURT REPORTS ANNOTATED

According to the respondent, he had not received the

SECTION 3. A new Paragraph 1.5 is hereby added to

VOL. 801, AUGUST 24, 2016 309

“CARRIER — any natural or juridical person or entity,

SECTION 5. The new Section 2 for Administrative Order

“Section 2. Accreditation.—Before it can proceed

The respondent then filed a supplemental petition

310 SUPREME COURT REPORTS ANNOTATED

As stated, the CA promulgated its assailed decision on

WHEREFORE, the instant petition is GRANTED.

THE COURT OF APPEALS ERRED IN INTERPRETING

VOL. 801, AUGUST 24, 2016 311

A. ADMINISTRATIVE ORDER NO. 00-05 AND ITS

14 Id., at pp. 21-22.

312 SUPREME COURT REPORTS ANNOTATED

the doctrine of non-delegability and separability of

Rules of Court expressly states that any person “whose

15 Smart Communications, Inc. (SMART) v. National

VOL. 801, AUGUST 24, 2016 313

such validity should have adhered to the doctrine of

We also need to remind that a petition for prohibition is

17 The Supreme Court shall have the following powers:

314 SUPREME COURT REPORTS ANNOTATED

the exercise of a quasi-legislative function. Prohibition is

remedy available in the ordinary course of law by which

20 Section 2, Rule 65 of the Rules of Court.

VOL. 801, AUGUST 24, 2016 315

SEC. 16. Palawan Council for Sustainable

SEC. 19. Powers and Functions.—In order to successfully

316 SUPREME COURT REPORTS ANNOTATED

projects are aligned with the plans, programs and policies of

VOL. 801, AUGUST 24, 2016 317

Accordingly, the PCSD had the explicit authority to fill

Cause Order issued to the respondent; LIFTS the

Sereno (CJ., Chairperson), Leonardo-De Castro, Perlas-

Petition granted, judgment annulled and set aside.

Note.—The doctrine of primary jurisdiction precludes

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