02 Laurel vs. Desierto

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48 SUPREME COURT REPORTS ANNOTATED

Laurel vs. Desierto

G.R. No. 145368. April 12, 2002.*

SALVADOR H. LAUREL, petitioner, vs. HON. ANIANO A.DESIERTO, in his capacity as Ombudsman, respondent.

Constitutional Law; Ombudsman; Public Officers; TheOmbudsman has the power to investigate any malfeasance,misfeasance and non­feasance by a public officer or employee of thegovernment, or of any subdivision, agency or instrumentalitythereof, including government­owned or controlled corporations;Public Officer Defined.—In sum, the Ombudsman has the powerto investigate any malfeasance, misfeasance and non­feasance bya public officer or employee of the government, or of anysubdivision, agency or instrumentality thereof, includinggovernment­owned or controlled corporations. Neither theConstitution nor the Ombudsman Act of 1989, however, defineswho public officers are. A definition of public officers cited injurisprudence is that provided by Mechem, a recognized authorityon the subject: A public office is the right, authority and duty,created and conferred by law, by which, for a given period, eitherfixed by law or enduring at the pleasure of the creating power, anindividual is invested with some portion of the sovereign functionsof the government, to be exercised by him for the benefit of thepublic. The individual so invested is a public officer.

Same; Same; Same; The characteristics of a public officeinclude the delegation of sovereign functions, its creation by lawand not by contract, an oath, salary, continuance of the position,scope of duties, and the designation of the position as an office.—The characteristics of a public office, according to Mechem,include the delegation of sovereign functions, its creation by lawand not by contract, an oath, salary, continuance of the position,scope of duties, and the designation of the position as an office.

Same; Same; Same; Court holds that the National CentennialCommission (NCC) performs executive functions.—We hold that

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the NCC performs executive functions. The executive power “isgenerally defined as the power to enforce and administer thelaws. It is the power of carrying the laws into practical operationand enforcing their due observance.” The executive function,therefore, concerns the implementation of the policies as set forthby law.

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* FIRST DIVISION.

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Same; Same; Same; The NCC was precisely created to ensurea more coordinated and synchronized celebrations of thePhilippine Centennial and wider participation from thegovernment and non­government or private organizations and torationalize the relevance of historical links with other countriesand to carry them into effect.—E.O. No. 128, reconstituting theCommittee for the National Centennial Celebrations in 1998,cited the “need to strengthen the said Committee to ensure amore coordinated and synchronized celebrations of the PhilippineCentennial and wider participation from the government and non­government or private organizations.” It also referred to the “needto rationalize the relevance of historical links with othercountries.” The NCC was precisely created to execute the foregoingpolicies and objectives, to carry them into effect.

Same; Same; Same; The promotion of industrialization andfull employment is a fundamental state policy.—There can hardlybe any dispute that the promotion of industrialization and fullemployment is a fundamental state policy.

Same; Same; Same; The NCC performs sovereign functions; Itis a public office and petitioner is a public officer.—Clearly, theNCC performs sovereign functions. It is, therefore, a public office,and petitioner, as its Chair, is a public officer.

Same; Same; Same; Fact that petitioner did not receive anycompensation during his tenure is of little consequence.—Thatpetitioner allegedly did not receive any compensation during histenure is of little consequence. A salary is a usual but not a

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necessary criterion for determining the nature of the position. It isnot conclusive. The salary is a mere incident and forms no part ofthe office. Where a salary or fees is annexed, the office is providedfor it is a naked or honorary office, and is supposed to be acceptedmerely for the public good. Hence, the office of petitioner as NCCChair may be characterized as an honorary office, as opposed to alucrative office or an office of profit, i.e., one to which salary,compensation or fees are attached. But it is a public office,nonetheless.

PETITION for review of a decision of the Ombudsman.

The facts are stated in the opinion of the Court.     Laurel Law Offices for petitioner.     The Solicitor General for respondent.

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KAPUNAN, J.:

On June 13, 1991, President Corazon C. Aquino issuedAdministrative Order No. 223 “constituting a Committeefor the preparation of the National Centennial Celebrationin 1998.” The Committee was mandated “to take charge ofthe nationwide preparations for the National Celebration ofthe Philippine Centennial of the Declaration of PhilippineIndependence and the Inauguration of the MalolosCongress.”

1

Subsequently, President Fidel V. Ramos issuedExecutive Order No. 128, “reconstituting the Committee forthe preparation of the National Centennial Celebrations in1998.” It renamed the Committee as the “NationalCentennial Commission.” Appointed to chair thereconstituted Commission was Vice­President Salvador

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1 A.O. 223, Section 1. The same section provided for the Committee’s

composition as follows:

x x x. The Committee shall be composed of six (6) representatives from the

Presidential Commission for Culture and the Arts (PCCA), and five (5)

representatives from the Philippine Centennial Foundation, Inc. (PCFI). They

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1.

2.

3.

4.

shall be appointed by the President upon their nomination by their respective

groups.

The Committee members shall elect among themselves the Chairman and Vice­

Chairman, and such other officers as they may deem necessary.

The Committee was also granted the following duties and powers:

To undertake the overall study, formulation and implementation of

programs and projects on the utilization of culture, arts, and media as

vehicles for value education in the context of the Centennial Celebration;

To act as principal coordinator for all the activities related to awareness

and celebration of the centennial;

To constitute sub­committees and working groups which shall undertake

the implementation of the program and projects; and

To call upon the assistance of any government agency or instrumentality

and corporation, and to invite private individuals and organizations to

assist it in the performance of its tasks. (Id., at Section 2.)

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H. Laurel. Presidents Diosdado M. Macapagal and CorazonC. Aquino were named Honorary Chairpersons.

2

Characterized as an “ad­hoc body,” the existence of theCommission “shall terminate upon the completion of allactivities related to the Centennial Celebrations.”

3 Like its

predecessor Committee, the Commission was tasked to“take charge of the nationwide preparations for theNational Celebration of the Philippine Centennial of theDeclaration of Philippine Independence and theInauguration of the Malolos Congress.”

Per Section 6 of the Executive Order, the Commissionwas also charged with the responsibility to “prepare, forapproval of the President, a Comprehensive Plan for theCentennial Celebrations within six (6) months from theeffectivity of the Executive Order.

E.O. No. 128 also contained provisions for staff supportand funding:

SEC. 3. The Commission shall be provided with technical andadministrative staff support by a Secretariat to be composed of,among others, detailed personnel from the PresidentialManagement Staff, the National Commission for Culture and theArts, and the National Historical Institute. Said Secretariat shall

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be headed by a full time Executive Director who shall bedesignated by the President.

SEC. 4. The Commission shall be funded with an initial budgetto be drawn from the Department of Tourism and the president’sContingent Fund, in an amount to be recommended by theCommission, and approved by the President. Appropriations forsucceeding years shall be incorporated in the budget of the Officeof the President.

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2 Other members of the Commission were the Secretaries of Education,

Culture and Sports, National Defense, Interior and Local Government,

Tourism, Trade and Industry, Public Works and Highways,

Transportation and Communications, and Budget and Management, the

Press Secretary, two (2) representatives each from the Senate and the

House of Representatives, two (2) representatives from the Judiciary, the

Executive Director of the National Historical Institute, three (3)

representatives from the National Commission for Culture and Arts, three

(3) representatives from the Philippine Centennial Foundation, Inc., and

other members from the government and the private sectors, “as may be

designated later.” (E.O. No. 128, Section 1.)3 Id., at Section 5.

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Subsequently, a corporation named the PhilippineCentennial Expo ‘98 Corporation (Expocorp) was created.

4

Petitioner was

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4 The purposes of the corporation were set forth in Article 2 of the

Articles of Incorporation, thus:

PRIMARY PURPOSE

To set up and establish the Philippine Centennial International Exposition 1998

(EXPO ‘98), a project of the National Centennial Commission envisioned and

mandated under Executive Order No. 128, series of 1993, in the Clark Special

Economic Zone (CSEZ) within the Provinces of Pampanga and Tarlac, Philippines

as created, defined and delineated under Proclamation No. 163, series 1993, of the

President of the Philippines and furtherance of said purpose;

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1.

2.

3.

4.

5.

6.

a)

b)

c)

d)

e)

7.

To operate, administer, manage, implement, and develop EXPO ’98

conformably to and in accordance with the Detailed Feasibility study and

Master Plan for said Exposition prepared by DOUGLAS/GALLAGHER,

INC. and approved by the President of the Philippines;

To exercise oversight functions and overall jurisdiction over the operations

of EXPO ’98 as well as manage and oversee all plans, programs, and

activities related to the implementation and operation of said Exposition;

To regulate the establishment, operation, and maintenance of utilities,

services, and infrastructure works in all the site components of EXPO ’98

and its support facilities;

To oversee the preparations for the implementation of the participation of

countries, groups, organizations, and entities at EXPO ’98;

To establish linkages with participating countries and coordinate their

programs and activities relevant to the theme of EXPO ’98;

To provide and prescribe the guidelines for the design and fabrication of

the pavilions of participating countries that played a significant role in

Philippine historical development and of other participating groups,

organizations, and entities which would be reflective of the following

objectives of EXPO ’98—

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among the nine (9) Expocorp incorporators, who were alsoits first nine (9) directors. Petitioner was elected ExpocorpChief Executive Officer.

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showcase the national vision of the Philippines, highlighted by a rich

history and culture, and its traditional heritage and diverse cultural

influences;

express eloquently the Filipinism sentiment of the Philippine Centennial;

strengthen cultural and historical linkages between Philippines and

participating countries;

create an image of the Philippines as a country with rich trade and tourism

potentials; and

project the Filipino character and strengthen the sense of national pride

and patriotism among the Filipino people.

To conceive and devise varied promotional strategies towards creating

awareness and appreciation of EXPO ’98 as the centerpiece of the national

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8.

9.

(1)

(2)

(3)

(4)

celebrations in 1998 of the centennial of the declaration of Philippine

Independence and beyond that as a permanent site for the Filipino people

to honor their rich heritage;

To encourage and invite the active and meaningful participation of the

private sector in managing and overseeing EXPO ’98; and

To forge strategic partnerships and joint ventures with local and

international investors and developers in the development, maintenance,

operation, and management of EXPO ’98 on a turn­key basis.

SECONDARY PURPOSES

To purchase, acquire, own, lease, sell and convey real properties such as

lands, buildings, factories and warehouses and machineries, equipment

and other personal properties as may be necessary or incidental to the

conduct of the corporate business, and to pay in cash, shares of its capital

stock, debentures and other evidences of indebtedness, or other securities,

as may be deemed expedient, for any business or property acquired by the

corporation.

To borrow or raise money necessary to meet the financial requirements of

its business by the issuance of bonds, promissory

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On August 5, 1998, Senator Ana Dominique Cosetengdelivered a privilege speech in the Senate denouncingalleged anomalies in

______________

notes and other evidences of indebtedness, and to secure the

repayment thereof by mortgage, pledge, deed of trust or lien upon

the properties of the corporation or to issue pursuant to law shares

of its capital stock, debentures and other evidences of indebtedness

in payment for properties acquired by the corporation or for money

borrowed in the prosecution of its lawful business;

To invest and deal with the money and properties of the

corporation in such manner as may from time to time be

considered wise or expedient for the advancement of its interests

and to sell, dispose of or transfer the business, properties and

goodwill of the corporation or any part thereof for such

consideration and under such terms as it shall see fit to accept;

To aid in any manner any corporation, association, or trust estate,

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(5)

(6)

(7)

(8)

domestic or foreign, or any firm or individual, any shares of stock

in which or any bonds, debentures, notes, securities, evidences of

indebtedness, contracts, or obligations of which are held by or for

this corporation, directly or indirectly or through other

corporations or otherwise;

To enter into any lawful arrangement for sharing profits, union of

interest, unitization or farmout agreement, reciprocal concession,

or cooperation, with any corporation, association, partnership,

syndicate, entity, person or governmental, municipal or public

authority, domestic or foreign, in the carrying on of any business

or transaction deemed necessary, convenient or incidental to

carrying out any of the purposes of this corporation;

To acquire or obtain from any government or authority, national,

provincial, municipal or otherwise, or a corporation, company or

partnership or person, such charter, contracts, franchise,

privileges, exemption, licenses and concessions as may be

conducive to any of the objects of the corporation;

To establish and operate one or more branch offices of agencies

and to carry on any or all of its operations and business without

any restrictions as to place or amount including the right to hold,

purchase or otherwise acquire, lease, mortgage, pledge and convey

or otherwise deal in with real and personal property anywhere

within the Philippines;

To conduct and transact any and all lawful business, and to do or

cause to be done any one or more of the acts and things

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the construction and operation of the CentennialExposition Project at the Clark Special Economic Zone.Upon motion of Senator Franklin Drilon, SenatorCoseteng’s privilege speech was referred to the Committeeon Accountability of Public Officers and Investigation (TheBlue Ribbon Committee) and several other SenateCommittees for investigation.

On February 24, 1999, President Joseph Estrada issuedAdministrative Order No. 35, creating an ad hoc andindependent citizens’ committee to investigate all the factsand circumstances surrounding the Philippine centennialprojects, including its component activities. FormerSenator Rene A.V. Saguisag was appointed to chair the

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Committee.On March 23, 1999, the Senate Blue Ribbon Committee

filed with the Secretary of the Senate its Committee FinalReport No. 30 dated February 26, 1999. Among theCommittee’s recommendations was “the prosecution by theOmbudsman/DOJ of Dr. Salvador Laurel, chair of NCC andof EXPOCORP for violating the rules on public bidding,relative to the award of centennial contracts to AK (AsiaConstruction & Development Corp.); for exhibitingmanifest bias in the issuance of the NTP (Notice toProceed) to AK to construct the FR (Freedom Ring) even inthe absence of a valid contract that has caused materialinjury to government and for participating in the scheme topreclude audit by COA of the funds infused by thegovernment for the implementation of the said contracts allin violation . . . of the anti­graft law.”

5

Later, on November 5, 1999, the Saguisag Committeeissued its own report. It recommended “the furtherinvestigation by the Ombudsman, and indictment, inproper cases of,” among others, NCC Chair Salvador H.Laurel for violations of Section 3(e) of R.A. No.

______________

herein set forth as its purposes, within or without the Philippines, and

in any and all foreign countries, and to do everything necessary, desirable

or incidental to the accomplishment of the purposes or the exercise of any

one or more of the powers herein enumerated, or which shall at any time

appear conducive to or expedient for the protection or benefit of this

corporation.5 Rollo, p. 10.

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3019, Section 4(a) in relation to Section 11 of R.A. No. 6713,and Article 217 of the Revised Penal Code.

The Reports of the Senate Blue Ribbon and the SaguisagCommittee were apparently referred to the Fact­findingand Intelligence Bureau of the Office of the Ombudsman.On January 27, 2000, the Bureau issued its EvaluationReport, recommending:

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1.

2.

That a formal complaint be filed and preliminaryinvestigation be conducted before the Evaluationand Preliminary Investigation Bureau (EPIB),Office of the Ombudsman against former NCC andEXPOCORP chair Salvador H. Laurel, formerEXPOCORP President Teodoro Q. Peña and AKPresident Edgardo H. Angeles for violation of Sec.3(e) and (g) of R.A. No. 3019, as amended inrelation to PD 1594 and COA Rules andRegulations;That the Fact Finding and Intelligence Bureau ofthis Office, act as the nominal complainant.

6

In an Order dated April 10, 2000, Pelagio S. Apostol, OIC­Director of the Evaluation and Preliminary InvestigationBureau, directed petitioner to submit his counter­affidavitand those of his witnesses.

On April 24, 2000, petitioner filed with the Office of theOmbudsman a Motion to Dismiss questioning thejurisdiction of said office.

In an Order dated June 13, 2000, the Ombudsmandenied petitioner’s motion to dismiss.

On July 3, 2000, petitioner moved for a reconsiderationof the June 13, 2000 Order but the motion was denied in anOrder dated October 5, 2000.

On October 25, 2000, petitioner filed the present petitionfor certiorari.

On November 14, 2000, the Evaluation and PreliminaryInvestigation Bureau issued a resolution finding “probablecause to indict respondents SALVADOR H. LAUREL andTEODORO Q. PEÑA before the Sandiganbayan forconspiring to violate Section 3(e) of Republic Act No. 3019,in relation to Republic Act No. 1594.” The

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6 Id., at 134­135.

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resolution also directed that an information for violation ofthe said law be filed against Laurel and Peña. Ombudsman

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Aniano A. Desierto approved the resolution with respect toLaurel but dismissed the charge against Peña.

In a Resolution dated September 24, 2001, the Courtissued a temporary restraining order, commandingrespondents to desist from filing any information before theSandiganbayan or any court against petitioner for allegedviolation of Section 3(e) of the Anti­Graft and CorruptPractices Act.

On November 14, 2001, the Court, upon motion ofpetitioner, heard the parties in oral argument.

Petitioner assails the jurisdiction of the Ombudsman onthe ground that he is not a public officer because:

A.

EXPOCORP, THE CORPORATION CHAIRED BY PETITIONERLAUREL WHICH UNDERTOOK THE FREEDOM RINGPROJECT IN CONNECTION WITH WHICH VIOLATIONS OFTHE ANTI­GRAFT AND CORRUPT PRACTICES WEREALLEGEDLY COMMITTED, WAS A PRIVATE CORPORATION,NOT A GOVERNMENT­OWNED OR CONTROLLEDCORPORATION.

B.

THE NATIONAL CENTENNIAL COMMISSION (NCC) WASNOT A PUBLIC OFFICE.

C.

PETITIONER, BOTH AS CHAIRMAN OF THE NCC AND OFEXPOCORP WAS NOT A “PUBLIC OFFICER” AS DEFINEDUNDER THE ANTI­GRAFT & CORRUPT PRACTICES ACT.

7

In addition, petitioner in his reply8 invokes this Court’s

decision in Uy vs. Sandiganbayan,9 where it was held that

the jurisdiction of the Ombudsman was limited to casescognizable by the Sandi­

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7 Id., at 15.8 Id., at 296­297.9 312 SCRA 77 (1999).

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ganbayan, i.e., over public officers of Grade 27 and higher.As petitioner’s position was purportedly not classified asGrade 27 or higher, the Sandiganbayan and, consequently,the Ombudsman, would have no jurisdiction over him.

This last contention is easily dismissed. In the Court’sdecision in Uy, we held that “it is the prosecutor, not theOmbudsman, who has the authority to file thecorresponding information/s against petitioner in theregional trial court. The Ombudsman exercisesprosecutorial powers only in cases cognizable by theSandiganbayan.”

In its Resolution of February 22, 2000, the Courtexpounded:

The clear import of such pronouncement is to recognize theauthority of the State and regular provincial and city prosecutorsunder the Department of Justice to have control over prosecutionof cases falling within the jurisdiction of the regular courts. Theinvestigation and prosecutorial powers of the Ombudsman relateto cases rightfully falling within the jurisdiction of theSandiganbayan under Section 15 (1) of R.A. 6770 (“An ActProviding for the Functional and Structural Organization of theOffice of the Ombudsman, and for other purposes”) which vestsupon the Ombudsman “primary jurisdiction over cases cognizableby the Sandiganbayan...” And this is further buttressed by Section11 (4a) of R.A. 6770 which emphasizes that the Office of theSpecial Prosecutor shall have the power to “conduct preliminaryinvestigation and prosecute criminal cases within the jurisdictionof the Sandiganbayan.” Thus, repeated references to theSandiganbayan’s jurisdiction clearly serve to limit theOmbudsman’s and Special Prosecutor’s authority to casescognizable by the Sandiganbayan. [Emphasis in the original.]

The foregoing ruling in Uy, however, was short­lived. Uponmotion for clarification by the Ombudsman in the samecase, the Court set aside the foregoing pronouncement inits Resolution dated March 20, 2001. The Court explainedthe rationale for this reversal:

The power to investigate and to prosecute granted by law to theOmbudsman is plenary and unqualified. It pertains to any act oromission of any public officer or employee when such act oromission appears to be illegal, unjust, improper or inefficient. The

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law does not make a distinction between cases cognizable by theSandiganbayan and those cognizable by regular courts. It hasbeen held that the clause “any illegal act or omission

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of any public official” is broad enough to embrace any crimecommitted by a public officer or employee.

The reference made by RA 6770 to cases cognizable by theSandiganbayan, particularly in Section 15(1) giving theOmbudsman primary jurisdiction over cases cognizable by theSandiganbayan, and Section 11(4) granting the Special Prosecutorthe power to conduct preliminary investigation and prosecutecriminal cases within the jurisdiction of the Sandiganbayan,should not be construed as confining the scope of the investigatoryand prosecutory power of the Ombudsman to such cases.

Section 15 of RA 6770 gives the Ombudsman primaryjurisdiction over cases cognizable by the Sandiganbayan. The lawdefines such primary jurisdiction as authorizing the Ombudsman“to take over, at any stage, from any investigatory agency of thegovernment, the investigation of such cases.” The grant of thisauthority does not necessarily imply the exclusion from itsjurisdiction of cases involving public officers and employees byother courts. The exercise by the Ombudsman of his primaryjurisdiction over cases cognizable by the Sandiganbayan is notincompatible with the discharge of his duty to investigate andprosecute other offenses committed by public officers andemployees. Indeed, it must be stressed that the powers granted bythe legislature to the Ombudsman are very broad and encompassall kinds of malfeasance, misfeasance and non­feasancecommitted by public officers and employees during their tenure ofoffice.

Moreover, the jurisdiction of the Office of the Ombudsmanshould not be equated with the limited authority of the SpecialProsecutor under Section 11 of RA 6770. The Office of the SpecialProsecutor is merely a component of the Office of the Ombudsmanand may only act under the supervision and control and uponauthority of the Ombudsman. Its power to conduct preliminaryinvestigation and to prosecute is limited to criminal cases withinthe jurisdiction of the Sandiganbayan. Certainly, the lawmakersdid not intend to confine the investigatory and prosecutory powerof the Ombudsman to these types of cases. The Ombudsman is

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mandated by law to act on all complaints against officers andemployees of the government and to enforce their administrative,civil and criminal liability in every case where the evidencewarrants. To carry out this duty, the law allows him to utilize thepersonnel of his office and/or designate any fiscal, state prosecutoror lawyer in the government service to act as special investigatoror prosecutor to assist in the investigation and prosecution ofcertain cases. Those designated or deputized to assist him workunder his supervision and control. The law likewise allows him todirect the Special Prosecutor to prosecute cases outside theSandiganbayan’s jurisdiction in accordance with Section 11 (4c) ofRA 6770.

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The prosecution of offenses committed by public officers andemployees is one of the most important functions of theOmbudsman. In passing RA 6770, the Congress deliberatelyendowed the Ombudsman with such power to make him a moreactive and effective agent of the people in ensuring accountabilityin public office. A review of the development of our Ombudsmanlaw reveals this intent. [Emphasis in the original.]

Having disposed of this contention, we proceed to theprincipal grounds upon which petitioner relies. We firstaddress the argument that petitioner, as Chair of the NCC,was not a public officer.

The Constitution10

describes the Ombudsman and hisDeputies as “protectors of the people,” who “shall actpromptly on complaints filed in any form or manneragainst public officials or employees of the government, orany subdivision, agency or instrumentality thereof,including government­owned or controlled corporations.”Among the awesome powers, functions, and duties vestedby the Constitution

11 upon the Office of the Ombudsman is

to “[i]nvestigate... any act or omission of any public official,employee, office or agency, when such act or omissionappears to be illegal, unjust, improper, or inefficient.”

The foregoing constitutional provisions are substantiallyreproduced in R.A. No. 6770, otherwise known as the“Ombudsman Act of 1989.” Sections 13 and 15(1) of saidlaw respectively provide:

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SEC. 13. Mandate.—The Ombudsman and his Deputies, asprotectors of the people shall act promptly on complaints file inany form or manner against officers or employees of theGovernment, or of any subdivision, agency or instrumentalitythereof, including government­owned or controlled corporations,and enforce their administrative, civil and criminal liability inevery case where the evidence warrants in order to promoteefficient service by the Government to the people.

SEC. 15. Powers, Functions and Duties.—The Office of theOmbudsman shall have the following powers, functions andduties:

(1) Investigate and prosecute on its own or on complaint by anyperson, any act or omission of any public officer or employee,office or agency, when such act or omission appears to be illegalunjust, improper or inefficient? It has primary jurisdiction overcases cognizable by the

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10 ART. XI, SEC. 12.

11 ART. XI, SEC. 13 (1).

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Sandiganbayan and, in the exercise of this primary jurisdiction, itmay take over, at any stage, from any investigatory agency ofGovernment, the investigation of such cases;

x x x.

The coverage of the law appears to be limited only bySection 16, in relation to Section 13, supra:

SEC. 16. Applicability.—The provisions of this Act shall apply toall kinds of malfeasance, misfeasance and non­feasance that havebeen committed by any officer or employee as mentioned inSection 13 hereof, during his tenure of office.

In sum, the Ombudsman has the power to investigate anymalfeasance, misfeasance and non­feasance by a publicofficer or employee of the government, or of anysubdivision, agency or instrumentality thereof, includinggovernment­owned or controlled corporations.

12

Neither the Constitution nor the Ombudsman Act of

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1989, however, defines who public officers are. A definitionof public officers cited in jurisprudence

13 is that provided by

Mechem, a recognized authority on the subject:

A public office is the right, authority and duty, created andconferred by law, by which, for a given period, either fixed by lawor enduring at the pleasure of the creating power, an individual isinvested with some portion

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12 Section 22 extends these investigatory powers, under certain conditions, to

private persons:

SEC. 22. Investigatory Power.—The Office of the Ombudsman shall have the power to

investigate any serious misconduct in office allegedly committed by officials removable by

impeachment, for the purpose of filing a verified complaint for impeachment or over

Members of Congress, and the Judiciary.

In all cases of conspiracy between an officer or employee of the government and a private

person, the Ombudsman and his Deputies shall have jurisdiction to include such private

person as the evidence may warrant. The officer or employee and the private person shall

be tried jointly and shall be subject to the same penalties and liabilities.

13 E.g., Fernandez vs. Ledesma, 1 SCRA 620 (1963); Aparri vs. Court of Appeals,

127 SCRA 231 (1984).

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of the sovereign functions of the government, to be exercised byhim for the benefit of the public. The individual so invested is apublic officer.

14

The characteristics of a public office, according to Mechem,include the delegation of sovereign functions, its creationby law and not by contract, an oath, salary, continuance ofthe position, scope of duties, and the designation of theposition as an office.

15

Petitioner submits that some of these characteristics arenot present in the position of NCC Chair, namely: (1) thedelegation of sovereign functions; (2) salary, since hepurportedly did not receive any compensation; and (3)continuance, the tenure of the NCC being temporary.

Mechem describes the delegation to the individual ofsome of the sovereign functions of government as “[t]he

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most important characteristic” in determining whether aposition is a public office or not.

The most important characteristic which distinguishes an officefrom an employment or contract is that the creation andconferring of an office involves a delegation to the individual ofsome of the sovereign functions of government, to be exercised byhim for the benefit of the public;—that some portion of thesovereignty of the country, either legislative, executive or judicial,attaches, for the time being, to be exercised for the public benefit.Unless the powers conferred are of this nature, the individual isnot a public officer.

16

Did E.O. 128 delegate the NCC with some of the sovereignfunctions of government? Certainly, the law did notdelegate upon the NCC functions that can be described aslegislative or judicial. May the functions of the NCC thenbe described as executive?

We hold that the NCC performs executive functions. Theexecutive power “is generally defined as the power toenforce and administer the laws. It is the power of carryingthe laws into practi­

______________

14 F.R. MECHEM, A TREATISE ON THE LAW OF PUBLIC OFFICES

AND OFFICERS, §1.15 Id., at §§4­10. See also 63C Am Jur 2d, Public Officers and

Employees §1.16 Id., at §4.

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cal operation and enforcing their due observance.”17

Theexecutive function, therefore, concerns the implementationof the policies as set forth by law.

The Constitution provides in Article XIV (Education,Science and Technology, Arts, Culture, and Sports) thereof:

SEC. 15. Arts and letters shall enjoy the patronage of the State.The State shall conserve, promote, and popularize the nation’shistorical and cultural heritage and resources, as well as artisticcreations.

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In its preamble, A.O. No. 223 states the purposes for thecreation of the Committee for the National CentennialCelebrations in 1998:

WHEREAS, the birth of the Republic of the Philippines is to becelebrated in 1998, and the centennial presents an importantvehicle for fostering nationhood and a strong sense of Filipinoidentity;

WHEREAS, the centennial can effectively showcase Filipinoheritage and thereby strengthen Filipino values;

WHEREAS, the success of the Centennial Celebrations may beinsured only through long­range planning and continuousdevelopmental programming;

WHEREAS, the active participation of the private sector in allareas of special expertise and capability, particularly incommunication and information dissemination, is necessary forlong­range planning and continuous developmental programming;

WHEREAS, there is a need to create a body which shallinitiate and undertake the primary task of harnessing themultisectoral components from the business, cultural, andbusiness sectors to serve as effective instruments from thelaunching and overseeing of this long­term project;

x x x.

E.O. No. 128, reconstituting the Committee for theNational Centennial Celebrations in 1998, cited the “needto strengthen the said Committee to ensure a morecoordinated and synchronized celebrations of thePhilippine Centennial and wider participation from thegovernment and non­government or private organiza­

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17 Ople vs. Torres, 293 SCRA 141 (1998).

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tions.” It also referred to the “need to rationalize therelevance of historical links with other countries.”

The NCC was precisely created to execute the foregoing

policies and objectives, to carry them into effect. Thus, theCommission was vested with the following functions:

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(a)

(b)

(c)

(d)

(e)

(f)

(g)

To undertake the overall study, conceptualization,formulation and implementation of programs and

projects on the utilization of culture, arts, literature

and media as vehicles for history, economic

endeavors, and reinvigorating the spirit of national

unity and sense of accomplishment in every Filipino

in the context of the Centennial Celebrations. In thisregard, it shall include a Philippine NationalExposition ‘98 within Metro Manila, the originaleight provinces, and Clark Air Base as its majorvenues;To act as principal coordinator for all the activitiesrelated to awareness and celebration of theCentennial;To serve as the clearing house for the preparationand dissemination of all information about theplans and events for the Centennial Celebrations;To constitute working groups which shallundertake the implementation of the programs andprojects;To prioritize the refurbishment of historical sitesand structures nationwide. In this regard, theCommission shall formulate schemes (e.g. lease­maintained­and­transfer, build­operate­transfer,and similar arrangements) to ensure thepreservation and maintenance of the historical sitesand structures;To call upon any government agency orinstrumentality and corporation, and to inviteprivate individuals and organizations to assist it inthe performance of its tasks; and,Submit regular reports to the President on theplans, programs, projects, activities as well as thestatus of the preparations for the Celebration.

18

It bears noting the President, upon whom the executivepower is vested,

19 created the NCC by executive order. Book

III (Office of the President), Chapter 2 (Ordinance Power),Section 2 describes the nature of executive orders:

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18 Id., at Sec. 2.19 CONSTITUTION, ARTICLE VII, SECTION 1.

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SEC. 2. Executive Orders.—Acts of the President providing forrules of a general or permanent character in implementation orexecution of constitutional or statutory powers shall bepromulgated in executive orders. [Italics ours.]

Furthermore, the NCC was not without a role in thecountry’s economic development, especially in CentralLuzon. Petitioner himself admitted as much in the oralarguments before this Court:

MR. JUSTICE REYNATO S. PUNO:

      And in addition to that expounded by FormerPresident Ramos, don’t you agree that the task of thecentennial commission was also to focus on the longterm over all socio economic development of the zoneand Central Luzon by attracting investors in the areabecause of the eruption of Mt. Pinatubo.

FORMER VICE PRESIDENT SALVADOR H. LAUREL:

  I am glad Your Honor touched on that because that issomething I wanted to touch on by lack of materialtime I could not but that is a very important point.When I was made Chairman I wanted the Expo to bein Batangas because I am a Batangeño but PresidentRamos said Mr. Vice President the Central Luzon issuffering, suffering because of the eruption of Mt.Pinatubo let us try to catalize [sic] economic recovery inthat area by putting this Expo in Clark Field and so itwas done I agreed and Your Honor if I may alsomention we wanted to generate employment aside fromattracting business investments and employment. Andthe Estrada administration decided to junk this projectthere 48, 40 thousand people who lost job, they wereemployed in Expo. And our target was to provide 75thousand jobs. It would have really calibrated,accelerated the development of Central Luzon. Now, Ithink they are going back to that because they had theairport and there are plan to revive the Expo site intokey park which was the original plan.

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There can hardly be any dispute that the promotion ofindustrialization and full employment is a fundamentalstate policy.

20

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20 Article XII (National Economy and Patrimony) of the Constitution

provides:

Section 1. x x x.

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Petitioner invokes the ruling of this Court in Torio vs.

Fontanilla21

that the holding by a municipality of a townfiesta is a proprietary rather than a governmental function.Petitioner argues that the “holding of a nationwidecelebration which marked the nation’s 100th birthday maybe likened to a national fiesta which involved only theexercise of the national government’s proprietaryfunction.”

22 In Torio, we held:

[Section 2282 of the Chapter on Municipal Law of the RevisedAdministrative Code] simply gives authority to the municipalityto [celebrate] a yearly fiesta but it does not impose upon it a dutyto observe one. Holding a fiesta even if the purpose is tocommemorate a religious or historical event of the town is inessence an act for the special benefit of the community and not forthe general welfare of the public performed in pursuance of apolicy of the state. The mere fact that the celebration, as claimed,was not to secure profit or gain but merely to provideentertainment to the town inhabitants is not a conclusive test.For instance, the maintenance of parks is not a source of incomefor the town, nonetheless it is [a] private undertaking asdistinguished from the maintenance of public schools, jails, andthe like which are for public service.

As stated earlier, there can be no hard and fast rule forpurposes of determining the true nature of an undertaking orfunction of a municipality; the surrounding circumstances of aparticular case are to be considered and will be decisive. The basicelement, however beneficial to the public the undertaking may be,is that it is government in essence, otherwise, the functionbecomes private or propriety in character. Easily, no

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governmental or public policy of the state is involved in thecelebration of a town fiesta.

______________

The State shall promote industrialization and full employment based on sound

agricultural development and agrarian reform, through industries that make full

and efficient use of human and natural resources, and which are competitive in

both domestic and foreign markets. x x x.

In the pursuit of these goals, all sectors of the economy and all regions of the

country shall be given optimum opportunity to develop. x x x.

21 85 SCRA 599 (1978).22 Rollo, p. 466.

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Torio, however, did not intend to lay down an all­encompassing doctrine. Note that the Court cautioned that“there can be no hard and fast rule for purposes ofdetermining the true nature of an undertaking or functionof a municipality; the surrounding circumstances of aparticular case are to be considered and will be decisive.”Thus, in footnote 15 of Torio, the Court, citing an Americancase, illustrated how the “surrounding circumstances plusthe political, social, and cultural backgrounds” couldproduce a conclusion different from that in Torio:

We came across an interesting case which shows that surroundingcircumstances plus the political, social, and cultural backgroundsmay have a decisive bearing on this question. The case of Pope v.City of New Haven, et al. was an action to recover damages forpersonal injuries caused during a Fourth of July fireworks displayresulting in the death of a bystander alleged to have been causedby defendants’ negligence. The defendants demurred to thecomplaint invoking the defense that the city was engaged in theperformance of a public governmental duty from which it receivedno pecuniary benefit and for negligence in the performance ofwhich no statutory liability is imposed. This demurrer wassustained by the Superior Court of New Haven Country. Plaintiffsought to amend his complaint to allege that the celebration wasfor the corporate advantage of the city. This was denied. Inaffirming the order, the Supreme Court of Errors of Connecticut

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held inter alia:Municipal corporations are exempt from liability for the

negligent performance of purely public governmental duties,unless made liable by statute. . . .

A municipality corporation, which under permissive authorityof its charter or of statute, conducted a public Fourth of Julycelebration, including a display of fireworks, and sent up a bombintended to explode in the air, but which failed to explode until itreached the ground, and then killed a spectator, was engaged inthe performance of a governmental duty. (99 A.R. 51)

This decision was concurred in by three Judges while twodissented.

At any rate the rationale of the Majority Opinion is evidentfrom [this] excerpt:

“July 4th, when that date falls upon Sunday, July 5th, is madea public holiday, called Independence Day, by our statutes. All ornearly all of the other states have similar statutes. While there isno United States statute making a similar provision, the differentdepartments of the government recognize, and have recognizedsince the government was estab­

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lished, July 4th as a national holiday. Throughout the country ithas been recognized and celebrated as such. These celebrations,calculated to entertain and instruct the people generally and toarouse and stimulate patriotic sentiments and love of country,frequently take the form of literary exercises consisting ofpatriotic speeches and the reading of the Constitution,accompanied by a musical program including patriotic airsometimes preceded by the firing of cannon and followed byfireworks. That such celebrations are of advantage to the generalpublic and their promotion a proper subject of legislation canhardly be questioned. x x x”

Surely, a town fiesta cannot compare to the NationalCentennial Celebrations. The Centennial Celebrations wasmeant to commemorate the birth of our nation aftercenturies of struggle against our former colonial master, tomemorialize the liberation of our people from oppression bya foreign power. 1998 marked 100 years of independenceand sovereignty as one united nation. The Celebrations

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was an occasion to reflect upon our history and reinvigorateour patriotism. As A.O. 223 put it, it was a “vehicle forfostering nationhood and a strong sense of Filipinoidentity,” an opportunity to “showcase Filipino heritageand thereby strengthen Filipino values.” The significance ofthe Celebrations could not have been lost on petitioner,who remarked during the hearing:

Oh, yes, certainly the State is interested in the unity of thepeople, we wanted to rekindle the love for freedom, love forcountry, that is the over­all goal that has to make everybody feelproud that he is a Filipino, proud of our history, proud of what ourforefather did in their time. x x x.

Clearly, the NCC performs sovereign functions. It is,therefore, a public office, and petitioner, as its Chair, is apublic officer.

That petitioner allegedly did not receive anycompensation during his tenure is of little consequence. Asalary is a usual but not a necessary criterion fordetermining the nature of the position. It is not conclusive.The salary is a mere incident and forms no part of theoffice. Where a salary or fees is annexed, the office isprovided for it is a naked or honorary office, and issupposed to be accepted merely for the public good.

23

Hence, the office of petitioner as NCC

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23 Id., at §§7, 15. See also Triste vs. Leyte State College Board of

Trustees, 192 SCRA 326 (1990).

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Chair may be characterized as an honorary office, asopposed to a lucrative office or an office of profit, i.e., one towhich salary, compensation or fees are attached.

24 But it is

a public office, nonetheless.Neither is the fact that the NCC was characterized by

E.O. No. 128 as an “ad­hoc body” make said commissionless of a public office.

The term office, it is said, embraces the idea of tenure and

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duration, and certainly a position which is merely temporary andlocal cannot ordinarily be considered an office. “But,” says ChiefJustice Marshall, “if a duty be a continuing one, which is definedby rules prescribed by the government and not by contract, whichan individual is appointed by government to perform, who enterson the duties pertaining to his station without any contractdefining them, if those duties continue though the person bechanged,—it seems very difficult to distinguish such a charge oremployment from an office of the person who performs the dutiesfrom an officer.”

At the same time, however, this element of continuance can notbe considered as indispensable, for, if the other elements arepresent “it can make no difference,” says PEARSON, C.J.,“whether there be but one act or a series of acts to be done,—whether the office expires as soon as the one act is done, or is to beheld for years or during good behavior.”

25

Our conclusion that petitioner is a public officer findssupport in In Re Corliss.

26 There the Supreme Court of

Rhode Island ruled that the office of Commissioner of theUnited States Centennial Commission is an “office of trust”as to disqualify its holder as elector of the United StatesPresident and Vice­President. (Under Article II of theUnited States Constitution, a person holding an office oftrust or profit under the United States is disqualified frombeing appointed an elector.)

x x x. We think a Commissioner of the United States CentennialCommission holds an office of trust under the United States, andthat he

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24 Id., at §13.

25 Id., at §8. Emphasis supplied.

26 23 Am Rep. 538 (1876).

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is therefore disqualified for the office of elector of President andVice­President of the United States.

The commission was created under a statute of the UnitedStates approved March 3, 1871. That statute provides for the

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holding of an exhibition of American and foreign arts, products,and manufactures, “under the auspices of the government of theUnited States,” and for the constitution of a commission, toconsist of more than one delegate from each State and from eachTerritory of the United States, “whose functions shall continueuntil close of the exhibition,” and “whose duty it shall be toprepare and superintend the execution of the plan for holding theexhibition.” Under the statute the commissioners are appointedby the President of the United States, on the nomination of thegovernor of the States and Territories respectively. Various dutieswere imposed upon the commission, and under the statuteprovision was to be made for it to have exclusive control of theexhibit before the President should announce, by proclamation,the date and place of opening and holding the exhibition. By anact of Congress approved June 1st, 1872, the duties and functionsof the commission were further increased and defined. That actcreated a corporation, called “The Centennial Board of Finance,”to cooperate with the commission and to raise and disburse thefunds. It was to be organized under the direction of thecommission. The seventh section of the act provides “that thegrounds for exhibition shall be prepared and the buildings erectedby the corporation, in accordance with plans which shall havebeen adopted by the United States Centennial Commission; andthe rules and regulations of said corporation, governing rates forentrance and admission fees, or otherwise affecting the rights,privileges, or interests of the exhibitors, or of the public, shall befixed and established by the United States CentennialCommission; and no grant conferring rights or privileges of anydescription connected with said grounds or buildings, or relatingto said exhibition or celebration, shall be made without theconsent of the United States Centennial Commission, and saidcommission shall have power to control, change, or revoke all suchgrants, and shall appoint all judges and examiners and award allpremiums.” The tenth section of the act provides that “it shall bethe duty of the United States Centennial Commission to supervisethe closing up of the affairs of said corporation, to audit itsaccounts, and submit in a report to the President of the UnitedStates the financial results of the centennial exhibition.”

It is apparent from this statement, which is but partial, thatthe duties and functions of the commission were various, delicate,and important; that they could be successfully performed only bymen of large experience and knowledge of affairs; and that theywere not merely subordinate and provisional, but in the highestdegree authoritative, discretion­

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ary, and final in their character. We think that personsperforming such duties and exercising such functions, inpursuance of statutory direction and authority, are not to beregarded as mere employees, agents, or committee men, but thatthey are, properly speaking, officers, and that the places whichthey hold are offices. It appears, moreover, that they wereoriginally regarded as officers by Congress; for the act underwhich they were appointed declares, section 7, that “nocompensation for services shall be paid to the commissioners orother officers, provided for in this act, from the treasury of theUnited States.” The only other officers provided for were the“alternates” appointed to serve as commissioners when thecommissioners were unable to attend.

Having arrived at the conclusion that the NCC performsexecutive functions and is, therefore, a public office, weneed no longer delve at length on the issue of whetherExpocorp is a private or a public corporation. Evenassuming that Expocorp is a private corporation,petitioner’s position as Chief Executive Officer (CEO) ofExpocorp arose from his Chairmanship of the NCC.Consequently, his acts or omissions as CEO of Expocorpmust be viewed in the light of his powers and functions asNCC Chair.

27

Finally, it is contended that since petitioner supposedlydid not receive any compensation for his services as NCC orExpocorp Chair, he is not a public officer as defined inRepublic Act No. 3019 (The Anti­Graft and CorruptPractices Act) and is, therefore, beyond the jurisdiction ofthe Ombudsman.

Respondent seeks to charge petitioner with violation ofSection 3 (e) of said law, which reads:

SEC. 3. Corrupt practices of public officers.—In addition to acts oromissions of public officers already penalized by existing law, thefollowing shall constitute corrupt practices of any public officerand are hereby declared to be unlawful:

x x x(e) Causing any undue injury to any party, including the

Government, or giving any private party any unwarrantedbenefits, advantage or preference in the discharge of his official,administrative or judicial functions through manifest partiality,evident bad faith or gross inexcusable negligence. This provision

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shall apply to officers and employees of offices

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27 See Yasay vs. Desierto, 300 SCRA 494 (1998).

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or government corporations charged with the grant of licenses orpermits or other concessions.

A “public officer,” under R.A. No. 3019, is defined bySection 2 of said law as follows:

SEC. 2. Definition of terms.—As used in this Act, the term—x x x(b) “Public officer” includes elective and appointive officials and

employees, permanent or temporary, whether in the classified orunclassified or exemption service receiving compensation, evennominal, from the government as defined in the precedingparagraph. [Emphasis supplied.]

It is clear from Section 2 (b), above, that the definition of a“public officer” is expressly limited to the application ofR.A. No. 3019. Said definition does not apply for purposesof determining the Ombudsman’s jurisdiction, as definedby the Constitution and the Ombudsman Act of 1989.

Moreover, the question of whether petitioner is a publicofficer under the Anti­Graft and Corrupt Practices Actinvolves the appreciation of evidence and interpretation oflaw, matters that are best resolved at trial.

To illustrate, the use of the term “includes” in Section 2(b) indicates that the definition is not restrictive.

28 The

Anti­Graft and Corrupt Practices Act is just one of severallaws that define “public officers.” Article 203 of the RevisedPenal Code, for example, provides that a public officer is:

x x x any person who, by direct provision of law, popular electionor appointment by competent authority, takes part in theperformance of public functions in the Government of Philippines,or performs in said Government or in any of its branches publicduties as an employee, agent or subordinate” official, of any rankor class.

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Section 2 (14) of the Introductory Provisions of theAdministrative Code of 1987,

29 on the other hand, states:

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28 Preclaro vs. Sandiganbayan, 247 SCRA 454 (1995).29 Executive Order No. 292.

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Officer—as distinguished from “clerk” or “employee”, refers to aperson whose duties not being of a clerical or manual nature,involves the exercise of discretion in the performance of thefunctions of the government. When used with reference to aperson having authority to do a particular act or perform aparticular person in the exercise of governmental power, “officer”includes any government employee, agent or body havingauthority to do the act or exercise that function.

It bears noting that under Section 3 (b) of Republic Act No.6713 (The Code of Conduct and Ethical Standards forPublic Officials and Employees), one may be considered a“public official” whether or not one receives compensation,thus:

“Public Officials” include elective and appointive officials andemployees, permanent or temporary, whether in the career ornon­career service including military and police personnel,whether or not they receive compensation, regardless of amount.

Which of these definitions should apply, if at all?

Assuming that the definition of public officer in R.A. No.3019 is exclusive, the term “compensation,” which is notdefined by said law, has many meanings.

Under particular circumstances, “compensation” has been held toinclude allowance for personal expenses, commissions, expenses,fees, an honorarium, mileage or traveling expenses, payments forservices, restitution or a balancing of accounts, salary, andwages.

30

How then is “compensation,” as the term is used in Section

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2 (b) of R.A. No. 3019, to be interpreted?Did petitioner receive any compensation at all as NCC

Chair? Granting that petitioner did not receive any salary,the records do not reveal if he received any allowance, fee,honorarium, or some other form of compensation. Notably,under the by­laws of Expocorp, the CEO is entitled to per

diems and compensation.31

Would such fact bear anysignificance?

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30 15 C.J.S. Compensation, p. 654.31 Rollo, p. 470.

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Obviously, this proceeding is not the proper forum to settlethese issues lest we preempt the trial court from resolvingthem.

WHEREFORE, the petition is DISMISSED. Thepreliminary injunction issued in the Court’s Resolutiondated September 24, 2001 is hereby LIFTED.

SO ORDERED.

      Puno and Ynares­Santiago, JJ., concur.      Davide, Jr. (C.J., Chairman), No part due to close

relations with a party.

Petition dismissed, preliminary injunction lifted.

Note.—Public officer under Section 2 (b) of Republic ActNo. 3019 includes elective or appointive officials andemployees, permanent or temporary, whether in the CareerService and Non­Career Service. (Preclaro vs.

Sandiganbayan, 247 SCRA 454 [1995])

——o0o——

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