7/29/2019 32 Dejesus v Coa

1/7

1

EN BANC[G.R. No. 109023. August 12, 1998.]

RODOLFO S. DE JESUS, EDELWINA DE PARUNGAO, VENUSM. POZON AND other similarly situated personnel of theLOCAL WATER UTILITIES ADMINISTRATION (LWUA),petitioners, vs. COMMISSION ON AUDIT AND LEONARDO L.JAMORALIN in his capacity as COA-LWUA CorporateAuditor, respondents.

D E C I S I O N

PURISIMA, J p:

The pivotal issue raised in this petition is whether or notthe petitioners are entitled to the payment of honorariawhich they were receiving prior to the effectivity of Rep.Act 6758.

Petitioners are employees of the Local Water Utilities

Administration (LWUA). Prior to July 1, 1989, they werereceiving honoraria as designated members of the LWUABoard Secretariat and the Pre-Qualification, Bids andAwards Committee.

On July 1, 1989, Republic Act No. 6758 (Rep. Act 6758),entitled "An Act Prescribing A Revised Compensation andPosition Classification System in the Government and For

Other Purposes", took effect. Section 12 of said lawprovides for the consolidation of allowances and additionalcompensation into standardized salary rates. Certainadditional compensations, however, were exempted fromconsolidation.Section 12, Rep Act 6758, reads

Sec. 12. Consolidation of Allowances andCompensation. Allowances, except forrepresentation and transportationallowances; clothing and laundry allowances;subsistence allowance of marine officers andallowances on board government vessels andhospital personnel; hazard pay; allowances offoreign services personnel stationed abroad;

7/29/2019 32 Dejesus v Coa

2/7

2

and such other additional compensation nototherwise specified herein as may bedetermined by the DBM, shall be deemedincluded in the standardized salary ratesherein prescribed. Such other additionalcompensation, whether in cash or in kind,being received by incumbents as of July 1,1989 not integrated into the standardizedsalary rates shall continue to be authorized."1 (Emphasis supplied)

To implement Rep. Act 6758, the Department of Budget

and Management (DBM) issued Corporate CompensationCircular No. 10 (DBM-CCC No. 10), discontinuing withoutqualification effective November 1, 1989, all allowancesand fringe benefits granted on top of basic salary.

Paragraph 5.6 of DBM-CCC No. 10 provides:

"Payment of other allowances/fringe benefits

and all other forms of compensation grantedon top of basic salary, whether in cash or inkind . . . shall be discontinued effectiveNovember 1, 1989. Payment made for suchallowances/fringe benefits after said dateshall be considered as illegal disbursement ofpublic funds." 2

Pursuant to the aforesaid Law and Circular, respondentLeonardo Jamoralin, as corporate auditor, disallowed onpost audit, the payment of honoraria to the hereinpetitioners.

Aggrieved, petitioners appealed to the COA, questioningthe validity and enforceability of DBM-CCC No. 10. More

specifically, petitioners contend that DBM-CCC No. 10 isinconsistent with the provisions of Rep. Act 6758 (the lawit is supposed to implement) and, therefore, void. And it iswithout force and effect because it was not published. inthe Official Gazette; petitioners stressed.

7/29/2019 32 Dejesus v Coa

3/7

3

In its decision dated January 29, 1993, the COA upheld thevalidity and effectivity of DBM-CCC No. 10 and sanctionedthe disallowance of petitioners' honoraria. 3

Undaunted, petitioners found their way to this court viathe present petition, posing the questions:

(1) Whether or not par. 5.6 of DBM- CCCNo. 10 can supplant or negate theexpress provisions of Sec. 12 of Rep.Act 6758 which it seeks to implement;and

(2) Whether or not DBM-CCC No. 10 islegally effective despite its lack ofpublication in the Official Gazette.

Petitioners are of the view that par. 5.6 of DBM-CCC No. 10prohibiting fringe benefits and allowances effectiveNovember 1, 1989, is violative of Sec. 12 of Rep. Act 6758

which authorizes payment of additional compensation notintegrated into the standardized salary which incumbentswere enjoying prior to July. 1, 1989.

To buttress petitioners' stance, the Solicitor Generalpresented a Manifestation and Motion in Lieu of Comment,opining that Sec. 5.6 of DBM-CCC No. 10 is a nullity forbeing inconsistent with and repugnant to the very law it is

intended to implement. The Solicitor General theorized,that:

". . . following the settled principle thatimplementing rules must necessarily adhereto and not depart from the provisions of thestatute it seeks to implement, it is crystal

clear that Section 5.6 of DBM-CCC No. 10 is apatent nullity. An implementing rule can onlybe declared valid if it is in harmony with theprovisions of the legislative act and for thesole purpose of carrying into effects itsgeneral provisions. When an implementingrule is inconsistent or repugnant to theprovisions of the statute it seeks to interpret,

7/29/2019 32 Dejesus v Coa

4/7

4

the mandate of the statute must prevail andmust be followed." 4

Respondent COA, on the other hand, pointed out that toallow honoraria without statutory, presidential or DBMauthority, as in this case, would run counter to Sec. 8,Article IX-B of the Constitution which proscribes paymentof "additional or double compensation, unless specificallyauthorized by law." Therefore, the grant of honoraria orlike allowances requires a specific legal or statutoryauthority. And DBM-CCC No. 10 need not be published forit is merely an interpretative regulation of a law already

published 5 ; COA concluded.In his Motion for Leave to intervene, the DBM Secretaryasserted that the honoraria in question are consideredincluded in the basic salary, for the reason that they arenot listed as exceptions under Sec. 12 of Rep. Act 6758.

Before resolving the other issue whether or notParagraph 5.6 of DBM-CCC No. 10 can supplant or negate

the pertinent provisions of Rep. Act 6758 which it seeks toimplement, we have to tackle first the other questionwhether or not DBM-CCC No. 10 has legal force and effectnotwithstanding the absence of publication thereof in theOfficial Gazette. This should take precedence becauseshould we rule that publication in the Official Gazette or ina newspaper of general circulation in the Philippines 6 issine qua non to the effectiveness or enforceability of DBM-

CCC No. 10, resolution of the first issue posited bypetitioner would not be necessary.

The applicable provision of law requiring publication in theOfficial Gazette is found in Article 2 of the New Civil Codeof the Philippines, which reads:

"Art. 2. Laws shall take effect afterfifteen days following the completion of theirpublication in the Official Gazette, unless it isotherwise provided. This Code shall takeeffect one year after such publication."

7/29/2019 32 Dejesus v Coa

5/7

5

In Tanada v. Tuvera, 146 SCRA 453,454, this Courtsuccinctly construed the aforecited provision of law inpoint, thus:

"We hold therefore that all statutes includingthose of local application and private laws,shall be published as a condition for their fortheir effectivity, which shall begin fifteen daysafter publication unless a different effectivitydate is fixed by the legislature.

Covered by this rule are presidential decrees

and executive orders promulgated by thePresident in the exercise of legislative powerswherever the same are validly delegated bythe legislature or, at present, directlyconferred by the Constitution. Administrativerules and regulations must also be publishedif their purpose is to enforce or implementexisting law pursuant to a valid delegation.

Interpretative regulations and those merelyinternal in nature, that is, regulating only thepersonnel of the administrative agency andnot the public, need not be published. Neitheris publication required of the so-called lettersof instructions issued by administrativesuperiors concerning the rules or guidelines

to be followed by their subordinates in theperformance of their duties.

Accordingly, even the charter of a city mustbe published notwithstanding that it appliesto only a portion of the national territory anddirectly affects only the inhabitants of that

place. All presidential decrees must bepublished, including even, say, those naminga public place after a favored individual orexempting him from certain prohibitions orrequirements. The circulars issued by theMonetary Board must be published if they aremeant not merely to interpret but to 'fill inthe details' of the Central Bank Act with that

7/29/2019 32 Dejesus v Coa

6/7

6

body is supposed to enforce." (Emphasisours)

The same ruling was reiterated in the case of PhilippineAssociation of Service Exporters, Inc. vs. Torres, 212 SCRA299 [1992].

On the need for publication of subject DBM-CCC No. 10, werule in the affirmative. Following the doctrine enunciatedin Tanada, publication in the Official Gazette or in anewspaper of general circulation in the Philippines isrequired since DBM-CCC No. 10 is in the nature of an

administrative circular the purpose of which is to enforceor implement an existing law. Stated differently, to beeffective and enforceable, DBM-CCC No. 10 must gothrough the requisite publication in the Official Gazette orin a newspaper of general circulation in the Philippines.

In the present case under scrutiny, it is decisively clearthat DBM-CCC No. 10, which completely disallows payment

of allowances and other additional compensation togovernment officials and employees, starting November 1,1989, is not a mere interpretative or internal regulation. Itis something more than that. And why not, when it, tendsto deprive government workers of their allowances andadditional compensation sorely needed to keep body andsoul together. At the very least, before the said circularunder attack may be permitted to substantially reduce

their income, the government officials and employeesconcerned should be apprised and alerted by thepublication of subject circular in the Official Gazette or in anewspaper of general circulation in the Philippines tothe end that they be given amplest opportunity to voiceout whatever opposition they may have, and to ventilatetheir stance on the matter. This approach is more in

keeping with democratic precepts and rudiments offairness and transparency.

In light of the foregoing disquisition on the ineffectivenessof DBM-CCC No. 10 due to its non-publication in the OfficialGazette or in a newspaper of general circulation in thecountry, as required by law, resolution of the other issueat bar is unnecessary.

7/29/2019 32 Dejesus v Coa

7/7

7

WHEREFORE, the Petition is hereby GRANTED, the assailedDecision of respondent Commission on Audit is SET ASIDE,and respondents are ordered to pass on audit thehonoraria of petitioners. No pronouncement as to costs.

SO ORDERED.

Narvasa, C .J ., Regalado, Davide, Jr., Romero, Bellosillo,Melo, Puno, Kapunan, Mendoza, Panganiban, Martinez andQuisumbing, JJ ., concur.Vitug, J ., is on leave.