CASE DIGEST : AGLIPAY VS RUIZ

G.R. No. L-45459 March 13, 1937 GREGORIO AGLIPAY, petitioner,  vs. JUAN RUIZ, respondent.

Facts :  In May, 1936, the Director of Posts announced in the dailies of Manila that he would order the issues of postage stamps commemorating the celebration in the City of Manila of the Thirty-third international Eucharistic Congress, organized by the Roman Catholic Church. The petitioner, in the fulfillment of what he considers to be a civic duty, requested Vicente Sotto, Esq., member of the Philippine Bar, to denounce the matter to the President of the Philippines. In spite of the protest of the petitioner's attorney, the respondent publicly announced having sent to the United States the designs of the postage stamps for printing The more important question raised refers to the alleged violation of the Constitution by the respondent in issuing and selling postage stamps commemorative of the Thirty-third International Eucharistic Congress. It is alleged that this action of the respondent is violative of the provisions of section 23, subsection 3, Article VI, of the Constitution of the Philippines, which provides as follows: No public money or property shall ever be appropriated, applied, or used, directly or indirectly, for the use, benefit, or support of any sect, church, denomination, secretarian, institution, or system of religion, or for the use, benefit, or support of any priest, preacher, minister, or other religious teacher or dignitary as such, except when such priest, preacher, minister, or dignitary is assigned to the armed forces or to any penal institution, orphanage, or leprosarium. 

ISSUE : WON the stamp is constitutional

 HELD : Act No. 4052 contemplates no religious purpose in view. What it gives the Director of Posts is the discretionary power to determine when the issuance of special postage stamps would be "advantageous to the Government." Of course, the phrase "advantageous to the Government" does not authorize the violation of the Constitution. It does not authorize the appropriation, use or application of public money or property for the use, benefit or support of a particular sect or church. In the present case, however, the issuance of the postage stamps in question by the Director of Posts and the Secretary of Public Works and Communications was not inspired by any sectarian denomination. The stamps were not issue and sold for the benefit of the Roman Catholic Church. Nor were money derived from the sale of the stamps given to that church It appears from the latter of the Director of Posts of June 5, 1936, incorporated on page 2 of the petitioner's complaint, that the only purpose in issuing and selling the stamps was "to advertise the Philippines and attract more tourist to this country." The officials concerned merely, took advantage of an event considered of international importance "to give publicity to the Philippines and its people What is emphasized is not the Eucharistic Congress itself but Manila, the capital of the Philippines, as the seat of that congress. It is obvious that while the issuance and sale of the stamps in question may be said to be inseparably linked with an event of a religious character, the resulting propaganda, if any, received by the Roman Catholic Church, was not the aim and purpose of the Government. We are of the opinion that the Government should not be embarassed in its activities simply because of incidental results, more or less religious in character, if the purpose had in view is one which could legitimately be undertaken by appropriate legislation. The main purpose should not be frustrated by its subordinate to mere incidental results not contemplated But, upon very serious reflection, examination of Act No. 4052, and scrutiny of the attending circumstances, we have come to the conclusion that there has been no constitutional infraction in the case at bar, Act No. 4052 grants the Director of Posts, with the approval of the Secretary of Public Works and Communications, discretion to misuse postage stamps with new designs "as often as may be deemed advantageous to the Government." Even if we were to assume that these officials made use of a poor judgment in issuing and selling the postage stamps in question still, the case of the petitioner would fail to take in weight. Between the exercise of a poor judgment and the unconstitutionality of the step taken, a gap exists which is yet to be filled to justify the court in setting aside the official act assailed as coming within a constitutional inhibition.

CASE DIGEST : CARPIO VS SULU RESOURCES DEVELOPMENT CORPORATION

G.R. No. 148267 August 8, 2002  ARMANDO C. CARPIO, petitioner, vs. SULU RESOURCES DEVELOPMENT CORPORATION, respondent.

FACTS : A petition was filed by respondent Sulu Resources Development Corporation for Mines Production Sharing Agreement (MPSA). Petitioner Armando C. Carpio filed an opposition/adverse claim thereto, alleging, inter alia, that his landholdings in Cupang and Antipolo, Rizal will be covered by respondent’s claim, thus he enjoys a preferential right to explore and extract the quarry resources on his properties.

the Panel of Arbitrators of the Mines and Geo-Sciences Bureau of the DENR rendered a Resolution dated September 26, 1996, upholding petitioner’s opposition/adverse claim.

Respondent appealed the foregoing Resolution to the Mines Adjudication Board. Meanwhile, petitioner filed a motion to dismiss appeal on the ground of respondent’s failure to comply with the requirements of the New Mining Act’s Implementing Rules and Regulations. On June 20, 1997, the Mines Adjudication Board rendered the assailed Order dismissing petitioner’s opposition/adverse claim. Petitioner filed a motion for reconsideration of said Order which was denied by the Board

Petioner appealed to CA. the CA relying in the case of Pearson v. Intermediate Appellate Court ruled that it did not have jurisdiction to review the Decision of the Mines Adjudication Board (MAB). The adjudication of conflicting mining claims is completely administrative in nature.

ISSUE : WON appeals from the Decision or Final Orders of the Mines Adjudication Board should be made directly to the Supreme Court as contended by the respondent and the Court of Appeals, or such appeals be first made to the Court of Appeals as contended by herein petitioner

HELD : Petitioner submits that appeals from the decisions of the MAB should be filed with the CA. the CA ruled and respondent agrees that the settlement of disputes involving rights to mining areas and overlapping or conflicting claim is a purely administrative matter, over which the MAB has appellate jurisdiction. The CA refused to take jurisdiction over the case because, under Section 79 of the Philippine Mining Act of 1995, petitions for review of MAB decisions are to be brought directly to the Supreme Court

In the case at bar, petitioner went to the CA through a Petition for Review on Certiorari under Rule 43, seeking a reversal of the MAB Decision. Given the difference in the reason for and the mode of appeal, it is obvious that Pearson is not applicable here.

In Pearson, what was under review was the ruling of the CFI to take cognizance of the case which had been earlier decided by the MAB, not the MAB Decision itself which was promulgated by the CA under Rule 43. The present petitioner seeks a review of the latter.

Pearson, however, should be understood in the light of other equally relevant jurisprudence. In Fabian v. Desierto, the Court clarified that appeals from judgments and final orders of quasi-judicial agencies are now required to be brought to the CA, under the requirements and conditions set forth in Rule 43. This Rule was adopted precisely to provide a uniform rule of appellate procedure from quasi-judicial agencies

Factual controversies are usually involved in administrative actions; and the CA is prepared to handle such issues because, unlike this Court, it is mandated to rule on questions of fact. In Metro Construction, we observed that not only did the CA have appellate jurisdiction over CIAC decisions and orders, but the review of such decisions included questions of fact and law. At the very least when factual findings of the MAB are challenged or alleged to have been made in grave abuse of discretion as in the present case, the CA may review them, consistent with the constitutional duty of the judiciary.

To summarize, there are sufficient legal footings authorizing a review of the MAB Decision under Rule 43 of the Rules of Court

first Section 79 of RA No. 7942 provides that decisions of the MAB may be reviewed by this Court on a "petition for review by certiorari." This provision is obviously an expansion of the Court’s appellate jurisdiction, an expansion to which this Court has not consented. Indiscriminate enactment of legislation enlarging the appellate jurisdiction of this Court would unnecessarily burden it

Second when the Supreme Court, in the exercise of its rule-making power, transfers to the CA pending cases involving a review of a quasi-judicial body’s decisions, such transfer relates only to procedure; hence, it does not impair the substantive and vested rights of the parties. The aggrieved party’s right to appeal is preserved; what is changed is only the procedure by which the appeal is to be made or decided

Third the Revised Rules of Civil Procedure included Rule 43 to provide a uniform rule on appeals from quasi-judicial agencies.

Fourth  the Court realizes that under Batas Pambansa (BP) Blg. 129 as amended by RA No. 7902 factual controversies are usually involved in decisions of quasi-judicial bodies; and the CA, which is likewise tasked to resolve questions of fact, has more elbow room to resolve them

Fifth he judicial policy of observing the hierarchy of courts dictates that direct resort from administrative agencies to this Court will not be entertained, unless the redress desired cannot be obtained from the appropriate lower tribunals, or unless exceptional and compelling circumstances justify availment of a remedy falling within and calling for the exercise of our primary jurisdiction.

Consistent with these rulings and legal bases, we therefore hold that Section 79 of RA 7942 is likewise to be understood as having been modified by Circular No. 1-91, BP Blg. 129 as amended by RA 7902, Revised Administrative Circular 1-95, and Rule 43 of the Rules of Court. In brief, appeals from decisions of the MAB shall be taken to the CA through petitions for review in accordance with the provisions of Rule 43 of the 1997 Rules of Court.

CASE DIGEST : METRO CONSTRUCTION vs CHATHAM PROPERTIES

G.R. No. 141897  September 24, 2001  METRO CONSTRUCTION, INC., petitioner, vs. CHATHAM PROPERTIES, INC., respondent.

FACTS : Respondent Chatham Properties, Inc. (CHATHAM) and petitioner Metro Construction, Inc. (MCI) entered into a contract for the construction of a multi-storey building known as the Chatham House. In April 1998, MCI sought to collect from CHATHAM a sum of money for unpaid progress billings and other charges and instituted a request for adjudication of its claims with the CIAC. The preliminary conference before the CIAC started in June 1998 and was concluded a month after with the signing of the Terms of Reference (TOR) of the Case. In the meantime, the TOR was amended and finalized on 19 August 1998. The facts, as admitted by the parties before the CIAC and incorporated in the original TOR, are as follows :

1. On 21 April 1994, the parties formally entered into a contract for the construction of the "Chatham House" . . . for the contract price of price of P50,000,000.00

2. On 12 July 1994, a Supplemental Contract was executed by and between the parties whereby CHATHAM authorized MCI to procure in behalf of the former materials, equipment, etc.

3. Under Section I.04 of the Supplemental Contract, the total amount of procurement and transportation cost[s] and expenses which may be reimbursed by MCI from CHATHAM shall not exceed the amount of P75, 000,000.00.

4. In the course of the construction, Change Orders No. 1, 4, 8A, 11, 12 and 13 were implemented,

5. CHATHAM reimbursed MCI the amount of P60,000.00 corresponding to bonuses advanced to its workers by the latter for the 14th, 16th, and 17th floors.

6. CHATHAM's payments to MCI totaled P104,875,792.37, representing payments for portions of MCI's progress billings and x x x additional charges..

In the resolution of these issues, the CIAC discovered significant data, which were not evident or explicit in the documents and records but otherwise revealed or elicited during the hearings, which the CIAC deemed material and relevant to the complete adjudication of the case

The CIAC disposed of the specific money claims by either granting or reducing them. On Issue No. 9, i.e., whether CHATHAM failed to complete and/or deliver the project within the approved completion period and, if so, whether CHATHAM is liable for liquidated damages and how much.

CIAC rendered JUdgement in favor of the Claimant [MCI] directing Respondent [CHATHAM] to pay Claimant [MCI] the net sum of SIXTEEN MILLION ONE HUNDRED TWENTY SIX THOUSAND NINE HUNDRED TWENTY TWO & 91/100 (16,126,922.91) PESOS. Impugning the decision of the CIAC, CHATHAM instituted a petition for review with the Court of Appeals

In upholding the decision of the CIAC, the Court of Appeals confirmed the jurisprudential principle that absent any showing of arbitrariness, the CIAC's findings as an administrative agency and quasi judicial body should not only be accorded great respect but also given the stamp of finality. However the Court of Appeals found exception in the CIAC's disquisition of Issue No.9 on the matter of liquidated damages.

ISSUE : WON under existing law and rules the Court of Appeals can also review findings of facts of the Construction Industry Arbitration Commission (CIAC)

HELD : EO. No. 1008 vest upon the CIAC original and exclusive jurisdiction over disputes arising from, or connected with, contracts entered into by parties involved in construction in the Philippines, whether the dispute arises before or after the completion of the contract, or after the abandonment or breach thereof. By express provision of Section 19 thereof, the arbitral award of the CIAC is final and unappealable, except on questions of law, which are appealable to the Supreme Court.

The parties, however, disagree on whether the subsequent Supreme Court issuances on appellate procedure and R.A. No. 7902 removed from the Supreme Court its appellate jurisdiction in Section 19 of E.O. No. 1008 and vested the same in the Court of Appeals, and whether appeals from CISC awards are no longer confined to questions of law.

Through Circular No. 1-91, the Supreme Court intended to establish a uniform procedure for the review of the final orders or decisions of the Court of Tax Appeals and other quasi judicial. The Circular designated the Court of Appeals as the reviewing body to resolve questions of fact or of law or mixed questions of fact and law.

It is clear that Circular No. 1-91 covers the CIAC. In the first place, it is a quasi judicial agency. In the second place, the language of Section 1 of Circular No. 1-91 emphasizes the obvious inclusion of the CIAC even if it is not named in the enumeration of quasi-judicial agencies. In sum, under Circular No. 1-91, appeals from the arbitral awards of the CIAC may be brought to the Court of Appeals, and not to the Supreme Court alone. The grounds for the appeal are likewise broadened to include appeals on questions of facts and appeals involving mixed questions of fact and law

The jurisdiction of the Court of Appeals over appeals from final orders or decisions of the CIAC is further fortified by the amendments to B.P. Blg. 129, as introduced by RA. No. 7902. With the amendments, the Court of Appeals is vested with appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of Regional Trial Courts and quasi-judicial agencies, instrumentalities, boards or commissions, except "those within the appellate jurisdiction of the Supreme Court in accordance with the Constitution, the Labor Code of the Philippines under Presidential Decree No. 442, as amended, the provisions of this Act, and of subparagraph (1) of the third paragraph and subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of 1948.".  In view of all the foregoing, The Supreme Court rejects MCI's submission that Circular No. 1-91, B.P. Blg. 129, as amended by RA. 7902, Revised Administrative Circular 1-95, and Rule 43 of the 1997 Rules of Civil Procedure failed to efficaciously modify the provision on appeals in E.O. No. 1008.

CASE DIGEST : SPOUSES DAVID vs CONSTRUCTION INDUSTRY AND ARBITRATION COMMISSION (CIAC)

G.R. No. 159795 July 30, 2004  SPOUSES ROBERTO & EVELYN DAVID and COORDINATED GROUP, INC., petitioners, vs. CONSTRUCTION INDUSTRY AND ARBITRATION COMMISSION and SPS. NARCISO & AIDA QUIAMBAO, respondents.

FACTS : Petitioner COORDINATED GROUP, INC. (CGI) is a corporation engaged in the construction business, with petitioner-spouses ROBERTO and EVELYN DAVID as its President and Treasurer, respectively. respondent-spouses NARCISO and AIDA QUIAMBAO engaged the services of petitioner CGI to design and construct a five-storey concrete office/residential building on their land in Tondo, Manila. The Design/Build Contract of the parties provided that:

(a) petitioner CGI shall prepare the working drawings for the construction project;

(b) respondents shall pay petitioner CGI the sum of Seven Million Three Hundred Nine Thousand Eight Hundred Twenty-One and 51/100 Pesos (P7,309,821.51) for the construction of the building,  including the costs of labor, materials and equipment, and Two Hundred Thousand Pesos (P200,000.00) for the cost of the design; and

 (c) the construction of the building shall be completed within nine (9) months after securing the building permit.

The completion of the construction was initially scheduled on or before July 16, 1998 but was extended to November 15, 1998 upon agreement of the parties but petitioners failed to follow the specifications and plans as previously agreed upon. Respondents demanded the correction of the errors but petitioners failed to act on their complaint. Consequently, respondents rescinded the contract on October 31, 1998, after paying 74.84% of the cost of construction

Respondents then engaged the services of another contractor, RRA and Associates, It was found that petitioners revised and deviated from the structural plan of the building without notice to or approval by the respondents.

Respondents filed a case for breach of contract against petitioners before the Regional Trial Court (RTC) of Manila. At the pre-trial conference, the parties agreed to submit the case for arbitration to CIAC. The RTC of Manila then dismissed the case and transmitted its records to the CIAC.

The arbitrator rendered judgment against petitioners. Petitioners appealed to the Court of Appeals which affirmed the arbitrator’s Decision but deleted the award for lost rentals

ISSUE : WON THE FACTUAL FINDINGS OF CIAC ARE FINAL AND CONCLUSIVE AND NOT REVIEWABLE BY THE SUPREME COURT ON APPEAL.

HELD: Executive Order No. 1008 entitled, "Construction Industry Arbitration Law" provided for an arbitration mechanism for the speedy resolution of construction disputes other than by court litigation. It recognized the role of the construction industry in the country’s economic progress as it utilizes a large segment of the labor force and contributes substantially to the gross national product of the country. Thus, E.O. No. 1008 vests on the CIAC original and exclusive jurisdiction over disputes arising from or connected with construction contracts entered into by parties who have agreed to submit their case to voluntary arbitration. Section 19 of E.O. No. 1008 provides that its arbitral award shall be appealable to the Supreme Court only on questions of law.

There is a question of law when the doubt or difference in a given case arises as to what the law is on a certain set of facts, and there is a question of fact when the doubt arises as to the truth or falsity of the alleged facts.

In the case at bar, it is readily apparent that petitioners are raising questions of fact. In their first assigned error, petitioners claim that at the time of rescission, they had completed 80% of the construction work and still have 15 days to finish the project. They likewise insist that they constructed the building in accordance with the contract and any modification on the plan was with the consent of the respondents. The second assigned error likewise involves a question of fact. It is contended that petitioner-spouses David cannot be held jointly and severally liable with petitioner CGI in the payment of the arbitral award as they are merely its corporate officers

Clearly, the case at bar does not raise any genuine issue of law. We reiterate the rule that factual findings of construction arbitrators are final and conclusive and not reviewable by this Court on appeal, except when the petitioner proves affirmatively that: (1) the award was procured by corruption, fraud or other undue means; (2) there was evident partiality or corruption of the arbitrators or of any of them; (3) the arbitrators were guilty of misconduct in refusing to postpone the hearing upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy; (4) one or more of the arbitrators were disqualified to act as such under section nine of Republic Act No. 876 and willfully refrained from disclosing such disqualifications or of any other misbehavior by which the rights of any party have been materially prejudiced; or (5) the arbitrators exceeded their powers, or so imperfectly executed them, that a mutual, final and definite award upon the subject matter submitted to them was not made.12 Petitioners failed to show that any of these exceptions applies to the case at bar.

CASE DIGEST : PHILROCK VS CONSTRUCTION INDUSTRY ARBITRATION COMMISSION (CIAC)

G.R. No. 132848-49 June 26, 2001  PHILROCK, INC., petitioner,  vs. CONSTRUCTION INDUSTRY ARBITRATION COMMISSION and Spouses VICENTE and NELIA CID, respondents.

FACTS : Private respondents, filed a Complaint for damages against Philrock and seven of its officers and engineers with the Regional Trial Court of Quezon City, Branch 82. The trial court issued an Order dismissing the case and referring the same to the CIAC because the Cid spouses and Philrock had filed an Agreement to Arbitrate with the CIAC. Preliminary conferences were held among the parties and their appointed arbitrators. At these conferences, disagreements arose as to:

1)  whether moral and exemplary damages and tort should be included as an issue along with breach of contract, and

2) whether the seven officers and engineers of Philrock who are not parties to the Agreement to Arbitrate should be included in the arbitration proceedings.

No common ground could be reached by the parties, hence, on April 2, 1994, both the Cid spouses and Philrock requested that the case be remanded to the trial court.

On June 13, 1995, The trial court declared that it no longer had jurisdiction over the case and ordered the records of the case to be remanded anew to the CIAC for arbitral proceedings. the CIAC resumed conducting preliminary conferences. On August 21, 1995, herein [P]etitioner Philrock requested to suspend the proceedings until the court clarified its ruling in the Order dated June 13, 1995

Petioner : Philrock argued that said Order was based on a mistaken premise that 'the proceedings in the CIAC fell through because of the refusal of Philrock to include the issue of damages therein,' whereas the true reason for the withdrawal of the case from the CIAC was due to Philrock's opposition to the inclusion of its seven officers and engineers, who did not give their consent to arbitration, as party defendants

Respondent : manifested that she was willing to exclude the seven officers and engineers of Philrock as parties to the case so as to facilitate or expedite the proceedings.

the Arbitral Tribunal denied Philrock's request for the suspension of the proceedings. The parties then proceeded to finalize, approve and sign the Terms of Reference. Philrock's counsel and representative, Atty. Pericles C. Consunji affixed his signature to said Terms of Reference which stated that 'the parties agree that their differences be settled by an Arbitral Tribunal

On September 12, 1995, [P]etitioner Philrock filed its Motion to Dismiss, alleging therein that the CIAC had lost jurisdiction to hear the arbitration case due to the parties' withdrawal of their consent to arbitrate. The motion was denied. public respondent ordered the parties to appear before it on November 28, 1995 for the continuation of the arbitral proceedings, and on February 7, 1996, public respondent directed [P]etitioner Philrock to set two hearing dates in the month of February to present its evidence and to pay all fees assessed by it, otherwise Philrock would be deemed to have waived its right to present evidence

Judgment is rendered in favor of the Claimant, directing Respondent to pay.

Before the CA, petitioner filed a Petition for Review, docketed as CA-GR SP No. 42443, contesting the jurisdiction of the CIAC and assailing the propriety of the monetary awards in favor of respondent spouses. This Petition was consolidated by the CA with CA-GR SP No. 39781, a Petition for Certiorari earlier elevated by petitioner questioning the jurisdiction of the CIAC.

ISSUE : Whether or not the CIAC could take jurisdiction over the case of Respondent Cid spouses against Petitioner Philrock after the case had been dismissed by both the RTC and the CIAC.

HELD : Section 4 of Executive Order 1008 expressly vests in the CIAC original and exclusive jurisdiction over disputes arising from or connected with construction contracts entered into by parties that have agreed to submit their dispute to voluntary arbitration. It is undisputed that the parties submitted themselves to the jurisdiction of the Commission by virtue of their Agreement to Arbitrate dated November 24, 1993. Signatories to the Agreement were Atty. Ismael J. Andres and Perry Y. Uy (president of Philippine Rock Products, Inc.) for petitioner, and Nelia G. Cid and Atty. Esteban A. Bautista for respondent spouses

Petitioner claims, on the other hand, that this Agreement was withdrawn by respondents on April 8, 1994, because of the exclusion of the seven engineers of petitioners in the arbitration case. This contention is untenable. First, private respondents removed the obstacle to the continuation of the arbitration, precisely by withdrawing their objection to the exclusion of the seven engineers. Second, petitioner continued participating in the arbitration even after the CIAC Order had been issued. Finally, as pointed out by the solicitor general, petitioner maneuvered to avoid the RTC’s final resolution of the dispute by arguing that the regular court also lost jurisdiction after the arbitral tribunal’s April 13, 1994 Order referring the case back to the RTC. After submitting itself to arbitration proceedings and actively participating therein, petitioner is estopped from assailing the jurisdiction of the CIAC, merely because the latter rendered an adverse decision.

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