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Jun 3, 2008

159 SCRA 556

  • Nature of quasi-judicial function
  • A body exercising quasi-judicial function is co-equal with the RTC
  • Rationale for prohibition on split jurisdiction
  • The rule on prior exhaustion of administrative remedies


This is a case about the Presidential Commission on Good Government, created through E.O. 1, charging it with the task of assisting the President in regard to the recovery of all ill-gotten wealth accumulated by the Marcoses, including the power to issue freeze orders or sequestration of all business enterprises owned by them upon showing of a prima facie case.

March 25, 1986

PCGG issued an order freezing the assets, effects, documents and records of two export garment manufacturing firms: American Inter-fashion Corporation and De Soleil Apparel Manufacturing Corporation.

June 27, 1986

PCGG designated the OIC, Saludo, and Yeung Chun Ho as authorized signatories to effect deposits and withdrawals of the funds of the two corporations.

Sept. 4, 1986

PCGG designated Yim Kam Shing as co-signatory, in the absence of Yeung Chun Ho and Marcelo de Guzman, in the absence of Saludo.

Feb. 3, 1987

Saludo, in a memorandum, revoked the authorizations previously issued upon finding that Mr. Yim Kam Shing was a Hong Kong Chinese national staying in the country on a mere tourist visa. The PCGG Commissioner approved the memorandum. Shortly, thereafter, Saludo withdrew funds from Metrobank against the accounts of the two corporations for payment of the salaries of the stuff.

Yeung Chung Kam, Yeung Chun Ho and Archie Chan instituted through Yim Kam Shing an action for damages with prayer for a writ of preliminary injunction against the said bank, PCGG, the Commissioner and OIC Saludo with the RTC, questiong the aforesaid revocation of the authorization as signatory previously granted to Yim Kam Shing. RTC issued TRO.

PCGG filed a motion to dismiss with opposition to Yim’s prayer for a writ of preliminary injunction on the ground that the trial court has no jurisdiction over the Commission or over the subject of the case. RTC judge denied PCGG’s motion to dismiss and granted Yim’s prayer for a writ of preliminary injunction.

Hence this petition.


  • Whether or not the RTC has jurisdiction over the PCGG


The Supreme Court held that RTC and the CA for that matter have no jurisdiction over the PCGG in the exercise of its powers under the applicable Executive Orders and Art. XVIII, sec. 26 of the Constitution and therefore may not interfere with and restrain or set aside the orders and actions of the Commission.

Under section 2 of the President's Executive Order No. 14 issued on May 7, 1986, all cases of the Commission regarding "the Funds, Moneys, Assets, and Properties Illegally Acquired or Misappropriated by Former President Ferdinand Marcos, Mrs. Imelda Romualdez Marcos, their Close Relatives, Subordinates, Business Associates, Dummies, Agents, or Nominees" whether civil or criminal, are lodged within the "exclusive and original jurisdiction of the Sandiganbayan" and all incidents arising from, incidental to, or related to, such cases necessarily fall likewise under the Sandiganbayan's exclusive and original jurisdiction, subject to review on certiorari exclusively by the Supreme Court.

Powers of the PCGG

E.O. 1 created PCGG, charging it to assist the President in the recovery of all ill-gotten wealth accumulated by the Marcoses, including sequestration and provisional takeover of all business enterprises owned by them as well as conduct investigations, require submission of evidence by subpoena, administer oaths, punish for contempt.

Freedom Constitution (Proc. No. 3) mandated the President to “…recover ill-gotten properties amassed by the leaders and supporters of the previous regime….”

Quasi-Judicial Function

As can be readily seen, PCGG exercises quasi-judicial functions. In the exercise of quasi-judicial functions, the Commission is a co-equal body with regional trial courts and “co-equal bodies have no power to control the other.” However, although under B.P. 129, the CA has exclusive appellate jurisdiction over all final judgment…of regional trial courts and quasi-judicial bodies, E.O. 14 specifically provides in section 2 that "The Presidential Commission on Good Government shall file all such cases, whether civil or criminal, with the Sandiganbayan which shall have exclusive and original jurisdiction thereof." Necessarily, those who wish to question or challenge the Commission's acts or orders in such cases must seek recourse in the same court, the Sandiganbayan, which is vested with exclusive and original jurisdiction. The Sandiganbayan's decisions and final orders are in turn subject to review on certiorari exclusively by this Court.

Prohibition against Split Jurisdiction

The law and the courts frown upon split jurisdiction and the resultant multiplicity of actions. To paraphrase the leading case of Rheem of the Phil., Inc. vs. Ferrer, et al.: to draw a tenuous jurisdiction line is to undermine stability in litigations. A piecemeal resort to one court and another gives rise to multiplicity of suits. To force the parties to shuttle from one court to another to secure full determination of their suit is a situation gravely prejudicial to the administration of justice. The time lost, the effort wasted, the anxiety augmented, additional expenses incurred, the irreparable injury to the public interest – are considerations which weigh heavily against split jurisdiction.

In addition, the case against PCGG and its Commissioner is clearly barred by the immunity provision of E.O. 1, as buttressed by section 4(b) thereof which further provides that: “No member or staff of the Commission shall be required to testify or produce evidence in any judicial, legislative or administrative proceeding concerning matters within its official cognizance.”

Executive Order No. 1 thus effectively withholds jurisdiction over cases against the Commission from all lower courts, including the Court of Appeals, except the Sandiganbayan in whom is vested original and exclusive jurisdiction and this Court. Early on, in special civil actions questioning challenged acts of the Commission, its submittal that the cited Executive Order bars such actions in this Court was given short shrift because this Court, as the third great department of government vested with the judicial power and as the guardian of the Constitution, cannot be deprived of its certiorari jurisdiction to pass upon and determine alleged violations of the citizens' constitutional and legal rights under the Rule of Law.

Primary Administrative Jurisdiction and Exhaustion of Administrative Remedies

The Court recently had occasion to stress once more, in G.R. No. 82218, Reyes vs. Caneba March 17, 1988, that "(T)he thrust of the related doctrines of primary administrative jurisdiction and exhaustion of administrative remedies is that courts must allow administrative agencies to carry out their functions and discharge their responsibilities within the specialized areas of their respective competence. Acts of an administrative agency must not casually be overturned by a court, and a court should as a rule not substitute its judgment for that of the administrative agency acting within the perimeters of its own competence."

Applying these fundamental doctrines to the case at bar, the questions and disputes raised by respondents seeking to controvert the Commission's finding of prima facie basis for the issuance of its sequestration orders as well as the interjection of the claims of the predecessor of American Inter-fashion and De Soleil Corporations, viz. Glorious Sun Phil., headed by Nemesis Co are all questions that are within the primary administrative jurisdiction of the Commission that cannot be prematurely brought up to clog the court dockets without first resorting to the exhaustion of the prescribed administrative remedies. The administrative procedure and remedies for contesting orders of sequestration issued by the Commission are provided for in its rules and regulations. Thus, the person against whom a writ of sequestration is directed may request the lifting thereof, in writing; after due hearing or motu proprio for good cause shown, the Commission may lift the writ unconditionally or subject to such conditions as it may deem necessary, taking into consideration the evidence and the circumstances of the case. The resolution of the Commission is appealable to the President of the Philippines. The Commission conducts a hearing, after due notice to the parties concerned to ascertain whether any particular asset, property or enterprise constitutes ill-gotten wealth. The Commission's order of sequestration is not final, at the proper time, the question of ownership of the sequestered properties shall be exclusively determined in the Sandiganbayan, whose own decisions in turn are subject to review exclusively by the Supreme Court.

It should be emphasized here, as again stressed by the Court in the recent case of Republic, et al. vs. De los Angeles, et al., G.R. No. L-30240, March 25, 1988, that "it is well-recognized principle that purely administrative and discretionary function may not be interfered with by the courts. In general, courts have no supervising power over the proceedings and actions of the administrative departments of government. This is generally true with respect to acts involving the exercise of judgment or discretion, and findings of fact. There should be no thought of disregarding the traditional line separating judicial and administrative competence, the former being entrusted with the determination of legal questions and the latter being limited as a result of its expertise to the ascertainment of the decisive facts." This is specially true in sequestration cases affected by the Commission for the recovery of the nation' s plundered wealth that may affect the nation's very survival, in the light of the constitutional mandate that such sequestration or freeze orders "shall be issued only upon showing of a prima facie case" and the settled principle that findings by administrative or quasi-judicial agencies like the Commission are entitled to the greatest respect and are practically binding and conclusive, like the factual findings of the trial and appellate courts, save where they are patently arbitrary or capricious or are not supported by substantial evidence.


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