ADMINISTRATIVE LAW Origin and development in relation to the

Doctrine of Separation of Powers

Introduction
 Under the Doctrine of Separation of
Administrative Law embraces all the law that Powers, all rules of conduct are
controls, or is intended to control, the supposed to be laid down directly by
administrative operations of government. It is the legislature, subject to the
that branch of modern law under which the (likewise) direct enforcement of the
executive department of the government, executive department, and the
acting in a quasi-legislative or quasi- judicial application or interpretation, also
capacity, interferes with the conduct of the directly, by the judiciary.
individual for the purpose of promoting the
well- being of the community, as under laws  It was felt that the legislative and
regulating public interest, professions, trades judicial departments no longer had
and callings, rates and prices, laws for the either the time or the needed
protection of public health and safety, and the expertise to attend to these new
promotion of public convenience. problems, not to mention the lack of
interest, particularly in the legislature,
Sources of Administrative Law as most of these problems did not
immediately affect the constituents of
1. Constitutional or statutory its members.
enactments creating administrative
bodies.  The obvious solution was delegation
of power. The legislature began
Examples: Aratuc v. Commission on Elections; authorizing certain specialized bodies
Maceda v. Energy Regulatory Board to lay down rules for the regulation of
matters entrusted to their jurisdiction
2. Decisions of courts interpreting the and, additionally, to apply these rules
charters of administrative bodies and in the adjudication of factual issues
defining their powers, rights, relating to these matters.
inhibitions, among others, and the
effects of their determinations and
regulations.
ADMINISTRATIVE FRAMEWORK
Example: Omnibus Rules Implementing the
Labor Code, as promulgated by the DOLE  Government of the Republic of the
Philippines: refers to the corporate
3. Rules and regulations issued by the governmental entity through which
administrative bodies in pursuance the functions of government are
of the purposes for which they were exercised throughout the Philippines.
created.
 Agency: refers to any of the various
Example: the awards of the NLRC with respect units of Government, including a
to money claims of employees department, bureau, office,
instrumentality, or government-
4. Determinations and order of the owned or controlled corporation, or a
administrative bodies in the settlements of local government or a distinct unit
controversies arising in their respective therein.
fields.
 Instrumentality: refers to any agency
of the National Government, not
 integrated within the department o The term “public office” refers to the
framework, vested with special right, authority and duty created and
functions or jurisdiction by law, conferred by law, by which, for a
endowed with some if not all given period either fixed by law or
corporate powers, administering enduring at the pleasure of the
special funds, and enjoying appointing power, an individual is
operational autonomy, usually invested with some portion of the
through a charter. This term includes sovereign functions of the
regulatory agencies, chartered government, to be exercised by that
institutions and government-owned individual for the benefit of the
or controlled corporations. public.

 Incorporated agencies: sometimes o A public office is a public trust or

with and at other times without responsibility.
capital stock, are vested by law with a
juridical personality distinct from the Reasons for creation of administrative
personality of the Republic. agencies

Ex: National Power Corporation, Phil. Ports This field of law is a recent development,
Authority, National Housing Authority. Phil. being a consequence of the ever-increasing
National Oil Company complexities of society and the proliferation
of problems of government that cannot
 Non-incorporated agencies: are those readily or effectively be addressed by the
not vested with a juridical personality traditional public agencies or solved by the
distinct from the Republic, endowed other disciplines of public law.
by law with some if not all corporate
powers. The reason for delegation of authority to
administrative agencies is the increasing
Ex: Sugar Regulatory Administration which is complexity of the task of government
not a GOCC but an agency under the OP. requiring expertise as well as the growing
inability of the legislature to cope directly with
* Incorporated and non-incorporated the myriad problems demanding its attention.
agencies or instrumentalities are all agents or The growth of society has ramified its
delegates of the Republic of the Philippines. activities and created peculiar and
sophisticated problems that the legislature
 Chartered institution: refers to any cannot be expected to attend to by itself.
agency organized or operating under Specialization even in legislation has become
a specific charter, and vested by law necessary. On many problems involving day-
with functions relating to specific to-day undertakings, the legislature may not
constitutional policies or objectives. have the needed competence to provide the
required direct and efficacious, not to say,
 Administration: refers to the specific solutions. These solutions may,
aggregate of those persons in whose however, be expected from its delegates, who
hand the reins of government are for are supposed to be experts in the particular
the time being. fields assigned to them. (Echegaray v.
Secretary)

ADMINISTRATIVE AGENCIES
Creation
o Administrative agencies, boards and
commissions are public offices.
  The administrative body or public performing some business for the
office may be created by the public.
Constitution or by statute or by an 4. Agencies created to function in
officer or tribunal to which the power situations wherein government is
to create the office has been seeking to regulate business affected
delegated by the legislature. with public interest.
5. Agencies created to function in
 If created by the Constitution itself, situations wherein government is
the administrative body can be seeking under the police power to
altered or abolished only by regulate private business and
constitutional amendment. individuals.
6. Agencies created to function in
 But where the body was created only situations wherein government is
by statute, the legislature that seeking to adjust individual
breathed life into it can amend or controversies because of some strong
even repeal its charter, thereby social policy involved.
resulting in its abolition. 7. Agencies created to function in
situations wherein government is
Power to Reorganize seeking to conduct investigations and
gather evidence for information,
Reorganization is the process of restructuring recommendation or prosecution of
the bureaucracy’s organizational and crimes.
functional set-up, to make it more viable in
terms of economy, effectiveness, and make it CASES: Government-Owned and Controlled
more responsive to the needs of its public Corporations v. Government Instrumentality
clientele as authorized by law.
An administrative body created by law may be Manila International Airport Authority v. City
reorganized pursuant to said law providing for of Pasay (April 2, 2009)
its establishment or another law authorizing
said reorganization. HELD: MIAA is a government
"instrumentality" that does not qualify as a
The legislature usually exercises the power to "government-owned or controlled
create or abolish by delegating it to the corporation.
President or to another executive officer or
body. The means by which the legislature A government-owned or controlled
makes the delegation is by authorizing corporation must be "organized as a stock or
reorganization. non-stock corporation." MIAA is not organized
as a stock or non-stock corporation. MIAA is
Types of Administrative Agencies not a stock corporation because it has no
capital stock divided into shares. MIAA has no
1. Agencies created to function in stockholders or voting shares.
situations wherein government is
offering some gratuity, grant, or MIAA is also not a non-stock corporation
special privileges. because it has no members. Section 87 of the
2. Agencies created to function in Corporation Code defines a non-stock
situations wherein government is corporation as "one where no part of its
seeking to carry on certain income is distributable as dividends to its
governmental functions. members, trustees or officers." A non-stock
3. Agencies created to function in corporation must have members.
situations wherein government is
MIAA is a government instrumentality vested corporation; second, the public character of
with corporate powers to perform efficiently its function; and third, government ownership
its governmental functions. MIAA is like any over the same.
other government instrumentality, the only
difference is that MIAA is vested with Possession of all three attributes is necessary
corporate powers. to deem an entity a GOCC.
** A government "instrumentality" may In this case, there is not much dispute that the
include a "government-owned or controlled MECO possesses the first and second
corporation," there may be a government attributes. It is the third attribute, which the
"instrumentality" that will not qualify as a MECO lacks.
"government-owned or controlled
corporation." Organization as a non–stock corporation and
the mere performance of functions with a
Funa v. Manila Economic and Cultural Office public aspect, however, are not by themselves
and COA (Feb. 04, 2014) sufficient to consider the MECO as a GOCC. In
order to qualify as a GOCC, a corporation
HELD: The MECO is not a GOCC or must also, if not more importantly, be owned
government instrumentality. by the government.

Government instrumentalities are agencies of The government owns a stock or non–stock

the national government that, by reason of corporation if it has controlling interest in the
some “special function or jurisdiction” they corporation. In a stock corporation, the
perform or exercise, are allotted “operational controlling interest of the government is
autonomy” and are “not integrated within the assured by its ownership of at least fifty–one
department framework.” Subsumed under percent (51%) of the corporate capital stock.
the rubric “government instrumentality” are In a non–stock corporation, like the MECO,
the following entities: regulatory agencies, jurisprudence teaches that the controlling
chartered institutions, government corporate interest of the government is affirmed when
entities or government instrumentalities with “at least majority of the members are
corporate powers (GCE/GICP), and GOCCs. government officials holding such
membership by appointment or designation”
The Administrative Code defines a GOCC: or there is otherwise “substantial
participation of the government in the
(13) Government–owned or controlled selection” of the corporation’s governing
corporation refers to any agency organized as board.
a stock or non–stock corporation, vested with
functions relating to public needs whether It is significant to note that none of the
governmental or proprietary in nature, and original incorporators of the MECO were
owned by the Government directly or through shown to be government officials at the time
its instrumentalities either wholly, or, where of the corporation’s organization. Indeed,
applicable as in the case of stock none of the members, officers or board of
corporations, to the extent of at least fifty– directors of the MECO, from its incorporation
one (51) per cent of its capital stock: x x x. up to the present day, were established as
government appointees or public officers
GOCCs, therefore, are “stock or designated by reason of their office. There is,
non–stock” corporations “vested with in fact, no law or executive order that
functions relating to public needs” that are authorizes such an appointment or
“owned by the Government directly or designation. Hence, from a strictly legal
through its instrumentalities.” By definition, perspective, it appears that the presidential
three attributes thus make an entity a GOCC: “desire letters” pointed out by petitioner—if
first, its organization as stock or non–stock such letters even exist outside of the case of
Mr. Basilio—are, no matter how strong its National Defense, who consequently has the
persuasive effect may be, merely power to conduct an extensive management
recommendatory. audit of petitioner corporation.

Indeed, from hindsight, it is clear that the Philippine Fisheries Development Authority
MECO is uniquely situated as compared with v. Court of Appeals (July 31, 2007)
other private corporations. From its over–
reaching corporate objectives, its special duty HELD: Indeed, the Authority is not a GOCC but
and authority to exercise certain consular an instrumentality of the government. The
functions, up to the oversight by the executive Authority has a capital stock but it is not
department over its operations—all the while divided into shares of stocks. Also, it has no
maintaining its legal status as a non– stockholders or voting shares. Hence, it is not
governmental entity—the MECO is, for all a stock corporation. Neither it is a non-stock
intents and purposes, sui generis. corporation because it has no members.

Boy Scouts of the Philippines v. COA The Authority is actually a national

(June 7, 2011) government instrumentality which is defined
as an agency of the national government, not
HELD: The BSP is a public corporation and its integrated within the department framework,
funds are subject to the COAs audit vested with special functions or jurisdiction by
jurisdiction. law, endowed with some if not all corporate
powers, administering special funds, and
Not all corporations, which are not enjoying operational autonomy, usually
government owned or controlled, are ipso through a charter. When the law vests in a
facto to be considered private corporations as government instrumentality corporate
there exists another distinct class of powers, the instrumentality does not become
corporations or chartered institutions which a corporation. Unless the government
are otherwise known as public corporations. instrumentality is organized as a stock or non-
Assuming for the sake of argument that the stock corporation, it remains a government
BSP ceases to be owned or controlled by the instrumentality exercising not only
government because of reduction of the governmental but also corporate powers.
number of representatives of the government
in the BSP Board, it does not follow that it also
ceases to be a government instrumentality as Feliciano v. Gison (August 25, 2010)
it still retains all the characteristics of the
latter as an attached agency of the DECS HELD: The Constitution recognizes two classes
under the Administrative Code. of corporations. The first refers to private
corporations created under a general law. The
Veterans Federation of the Philippines v. second refers to government-owned or
Angelo Reyes (Feb. 28, 2006) controlled corporations created by special
charters. Section 16, Article XII of the
HELD: In the case at bar, the functions of Constitution provides:
petitioner corporation enshrined in Section 4
of Rep. Act No. 264031 should most certainly Sec. 16. The Congress shall not, except by
fall within the category of sovereign functions. general law, provide for the formation,
The protection of the interests of war organization, or regulation of private
veterans is not only meant to promote social corporations. Government-owned or
justice, but is also intended to reward controlled corporations may be created or
patriotism. Petitioner VFP is a public established by special charters in the interest
corporation. As such, it can be placed under of the common good and subject to the test of
the control and supervision of the Secretary of economic viability.
 members to elect the board directors of LWDs
Economic viability is “the capacity to function as in the case of all corporations registered
efficiently in business.” To be economically with the Securities and Exchange Commission.
viable, the entity “should not go into activities The local mayor or the provincial governor
which the private sector can do better.” (City appoints the directors of LWDs for a fixed
of Lapu-Lapu) term of office. This Court has ruled that LWDs
are not created under the Corporation Code,
The Constitution emphatically prohibits the thus:
creation of private corporations except by a From the foregoing pronouncement, it is clear
general law applicable to all citizens. The that what has been excluded from the
purpose of this constitutional provision is to coverage of the CSC are those corporations
ban private corporations created by special created pursuant to the Corporation Code.
charters, which historically gave certain Significantly, petitioners are not created
individuals, families or groups special under the said code, but on the contrary, they
privileges denied to other citizens. were created pursuant to a special law and
are governed primarily by its provision.
In short, Congress cannot enact a law creating
a private corporation with a special charter. City of Lapu-Lapu v. Philippine Economic
Such legislation would be unconstitutional. Zone Authority (Nov. 26, 2014)
Private corporations may exist only under a
general law. If the corporation is private, it HELD: The law created the PEZA’s charter.
must necessarily exist under a general law. Under the Special Economic Zone Act of 1995,
Stated differently, only corporations created the PEZA was established primarily to perform
under a general law can qualify as private the governmental function of operating,
corporations. Under existing laws, that administering, managing, and developing
general law is the Corporation Code, except special economic zones to attract investments
that the Cooperative Code governs the and provide opportunities for preferential use
incorporation of cooperatives. of Filipino labor.

The Constitution authorizes Congress to Under its charter, the PEZA was created a
create government-owned or controlled body corporate endowed with some
corporations through special charters. Since corporate powers. However, it was not
private corporations cannot have special organized as a stock or non-stock corporation.
charters, it follows that Congress can create Nothing in the PEZA’s charter provides that
corporations with special charters only if such the PEZA’s capital is divided into shares. The
corporations are government-owned or PEZA also has no members who shall share in
controlled. the PEZA’s profits.

Obviously, LWDs [referring to local water The PEZA, therefore, need not be
districts] are not private corporations because economically viable. It is not a government-
they are not created under the Corporation owned or controlled corporation liable for
Code. LWDs are not registered with the real property taxes.
Securities and Exchange Commission. Section
14 of the Corporation Code states that [A]ll Republic v. City of Parañaque
corporations organized under this code shall (July 18, 2012)
file with the Securities and Exchange
Commission articles of incorporation x x x. HELD: In the case at bench, the Philippine
Reclamation Authority is not a GOCC because
LWDs have no articles of incorporation, no it is neither a stock nor a non-stock
incorporators and no stockholders or corporation. It cannot be considered as a
members. There are no stockholders or stock corporation because although it has a
capital stock divided into no par value shares purposes, such as the offices of public
as provided in Section 74 of P.D. No. 1084, it is prosecutor and the Ombudsman.
not authorized to distribute dividends, surplus
allotments or profits to stockholders. There is  Still others exercise investigatory
no provision whatsoever in P.D. No. 1084 or in powers in aid in the exercise of other
any of the subsequent executive issuances powers granted them, like the SEC in
pertaining to PRA, particularly, E.O. No. 525,5 the regulation of private corporations.
E.O. No. 6546 and EO No. 7987 that
authorizes PRA to distribute dividends,  Investigations are useful for all
surplus allotments or profits to its administrative functions including
stockholders. rule-making, adjudication, and
licensing, supervising and directing for
PRA cannot be considered a non-stock determination of public policy, for
corporation either because it does not have recommending legislation.
members. A non-stock corporation must have
members. Moreover, it was not organized for  The enabling act defines the extent of
any of the purposes mentioned in Section 88 such investigatory powers.
of the Corporation Code. Specifically, it was
created to manage all government
reclamation projects.
President’s Investigatory Power

POWER OF INVESTIGATION The President’s investigatory power emanates

from his power of supervision and control
Investigatory or “inquisitorial” power consists over all executive departments, bureaus, and
in gathering, organizing, and analyzing offices; his power of supervision over LGUS;
evidence, which is a useful aid or tool in an and his power of appointment of presidential
administrative agency’s performance of its appointees, which are conferred upon him by
rule–making or quasi-judicial functions. the Constitution.

It includes the power of an administrative His investigatory power also comes from
body to inspect the records, premises, and powers delegated to him by the legislature. In
investigate the activities of persons or entities the exercise of his investigatory power, the
coming under its jurisdiction, or to secure, or President may do so thru an executive officer,
to require the disclosure of information by or create a body or committee to conduct the
means of accounts, records, reports, investigation, empower said officer, body or
statements, testimony of witnesses, committee to issue subpoena and subpoena
production of documents, or otherwise. duces tecum for the purpose, and to make
recommendations, on the basis of which he
Purposes will make his appropriate action.

 The investigatory powers of some Ruperto v. Torres (Feb. 25, 1957)

agencies are limited to only
information gathering, as basis to HELD: The Board neither adjudicates upon nor
recommend appropriate action by determines the rights and interests or duties
other government agencies or to of parties; it is limited to investigating the
focus public opinion on matters of facts and making findings in respect thereto.
vital concern, like the CHR. After an investigation by the Board, the officer
that ultimately passes upon and adjudicates
 Other agencies are granted the rights of the parties is the President, not
investigatory powers for prosecution the board, or its successor.
 that the order be made pursuant to one. It is
Thus, a special civil action of certiorari "would enough that the investigation be for a lawfully
not lie to challenge action of the Board. The authorized purpose. The purpose of the
test of a judicial function is not the exercise of subpoena is to discover evidence, not to
judicial discretion, but the power and prove a pending charge, but upon which to
authority to adjudicate upon the rights and make one if the discovered evidence so
obligations of the parties before it. As the justifies.
Board lacks the power and authority to
adjudicate upon matters submitted to it for ISSUE: Is the person being investigated
investigation and make the final entitled to be informed of the findings and
pronouncement thereon affecting the parties, recommendations of the investigating body?
the second requisite for the availability of the
action of certiorari is wanting. HELD: No. He is only entitled to be informed
of the charges against him, to a hearing of
Evangelista v. Jarencio (Nov. 27, 1975) said charges, to an opportunity to meet the
evidence against him, to present his own
Issue: Does the Agency, acting thru its evidence and to be furnished with copy of the
officials, enjoy the authority to issue administrative decision, so that he may, if he
subpoenas in its conduct of fact-finding so desires, appeal therefrom to the CSC within
investigations? 15 days from notice.

Held: Yes. When investigative and accusatory An investigatory body with the sole power of
duties are delegated by statute to an investigation does not exercise judicial
administrative body, it, too may take steps to functions and its power is limited to
inform itself as to whether there is probable investigating the facts and making findings in
violation of the law. In sum, it may be stated respect thereto. The test whether an
that a subpoena meets the requirements for administrative body is exercising judicial
enforcement if the inquiry is (1) within the functions or merely investigatory functions is:
authority of the agency; (2) the demand is not if the only purpose of investigation is to
too indefinite; and (3) the information is evaluate evidence submitted before it based
reasonably relevant. on facts and circumstances presented to it,
and if the agency is not authorized to make a
There is no doubt that the fact-finding final pronouncement affecting the parties,
investigations being conducted by the Agency then there is an absence of judicial discretion
fall within the Agency's sphere of authority and judgment.
and that the information sought to be elicited
from respondent Fernando Manalastas, of There are administrative agencies which are
which he is claimed to be in possession, is granted only investigatory powers. Ex: CHR
reasonably relevant to the investigations. and NBI.

ISSUE: Is the filing of a complaint required Cariño v. Commission on Human Rights

before the investigating body may issue (Dec. 2, 1991)
subpoena?
HELD: No. Rightly, administrative agencies Issue: Whether or not the CHR has the power
may enforce subpoenas issued in the course to adjudicate or exercise quasi-judicial power,
of investigations, whether or not adjudication as an incident of its power to investigate.
is involved, and whether or not probable
cause is shown and even before the issuance Held: The CHR has no such power; and that it
of a complaint. It is not necessary, as in the was not meant by the fundamental law to be
case of a warrant, that a specific charge or another court or quasi-judicial agency in this
complaint of violation of law be pending or
country, or duplicate much less take over the this effect by the Secretary of
functions of the latter. Education, constitute infractions of
relevant rules and regulations
The most that may be conceded to the warranting administrative disciplinary
Commission in the way of adjudicative power sanctions, or are justified by the
is that it may investigate, i.e., receive grievances complained of by them;
evidence and make findings of fact as regards and
claimed human rights violations involving civil c) what where the particular acts done
and political rights. But fact finding is not by each individual teacher and what
adjudication, and cannot be likened to the sanctions, if any, may properly be
judicial function of a court of justice, or even a imposed for said acts or omissions.
quasi-judicial agency or official. The function
of receiving evidence and ascertaining These are matters undoubtedly and clearly
therefrom the facts of a controversy is not a within the original jurisdiction of the Secretary
judicial function, properly speaking. To be of Education, being within the scope of the
considered such, the faculty of receiving disciplinary powers granted to him under the
evidence and making factual conclusions in a Civil Service Law, and also, within the
controversy must be accompanied by the appellate jurisdiction of the Civil Service
authority of applying the law to those factual Commission.
conclusions to the end that the controversy
may be decided or determined Indeed, the Secretary of Education has, as
authoritatively, finally and definitively, subject above narrated, already taken cognizance of
to such appeals or modes of review as may be the issues and resolved them, and it appears
provided by law. This function, to repeat, the that appeals have been seasonably taken by
Commission does not have. the aggrieved parties to the Civil Service
Commission; and even this Court itself has
Hence it is that the Commission on Human had occasion to pass upon said issues.
Rights, having merely the power "to
investigate," cannot and should not "try and Thus, the power of the CHR is basically
resolve on the merits" (adjudicate) the investigatory and informational in nature. It
matters involved in Striking Teachers HRC may refer the results of its investigation to the
Case No. 90-775, as it has announced it means DOJ for possible prosecution of crimes
to do; and it cannot do so even if there be a involving violations of civil and political rights.
claim that in the administrative disciplinary
proceedings against the teachers in question, NBI – NATIONAL BUREAU OF
initiated and conducted by the DECS, their INVESTIGATION
human rights, or civil or political rights had
been transgressed. Similarly, the NBI’s functions are merely
investigatory and informational in nature. It
More particularly, the Commission has no has no judicial or quasi-judicial powers and is
power to "resolve on the merits" the question incapable of granting any relief to a party. It
of cannot even determine probable cause. It is
a) whether or not the mass concerted an investigative agency whose findings are
actions engaged in by the teachers merely recommendatory. It undertakes
constitute and are prohibited or investigation of crimes upon its own initiative
otherwise restricted by law; and as public welfare may require. It renders
b) whether or not the act of carrying on assistance when requested in the
and taking part in those actions, and investigation or detection of crimes. However,
the failure of the teachers to on the basis of its investigation of a crime, the
discontinue those actions, and return NBI may file the corresponding complaint with
to their classes despite the order to the Prosecutor’s Office or with the DOJ for
preliminary investigation and, if so warranted,
for filing by the latter of the information in
court.