G.R. No. 140920 - Bordallo vs. Professional Regulation Commission

On February 24, 1998, President Fidel V. Ramos approved Republic Act No. 8544, known as the “Philippine Merchant Marine Officers Act of 1998.”
The Act took effect on March 25, 1998, fifteen days after its publication in a major newspaper, replacing the former regulatory scheme under Presidential Decree No. 97.
Section 2 of R.A. No. 8544 establishes the state policy to ensure that only qualified and competent Marine Deck and Engineer Officers, determined through licensure examinations, may practice.
The law provides for the examination, registration, and issuance of Certificates of Competency to Merchant Marine Officers, setting a new standard for passing ratings.

Under R.A. No. 8544, Section 17 mandates that an examinee must obtain a weighted general average of at least 70% with no subject rating below 60% to be deemed as having passed.
In contrast, the earlier Presidential Decree No. 97 prescribed a higher passing general weighted average of 75% with the same minimum subject requirement.
The new law’s lower passing threshold created a potential conflict between the standards of the repealed law and those of the newly enacted Act.

On April 25, 26, and 27, 1998, the respondent Board of Marine Deck Officers conducted the licensure examination for deck officers.
Petitioners Juan Lorenzo Bordallo (for Chief Mate), Restituto de Castro (for Second Mate), and Noel Olarte (for Third Mate) took the examination during a transitional period.
At the time of the examination, the Board had not yet issued the new syllabi and implementing rules and regulations required under R.A. No. 8544, causing ambiguity in the applicable standard.

Despite obtaining general weighted averages higher than 70% and no subject score below 60%, all petitioners received notifications from the Philippine Regulatory Commission (PRC) that they had failed, as none met the 75% threshold prescribed under the now-repealed PD No. 97.
On May 21, 1998, petitioners filed a petition before the Board of Marine Deck Officers seeking recognition of their passing status based on the provisions of Section 17 of R.A. No. 8544.
Meanwhile, the PRC issued Resolution No. 569, Series of 1998, affirming that, in the absence of the new syllabi and rules, the grading system of PD No. 97 would continue to be used for the July 1998 examinations.
On January 22, 1999, the Board of Marine Deck Officers issued an Order denying the petition, relying on PRC Resolution No. 569 and the absence of the new implementing rules.

After receiving the Board’s Order on February 9, 1999, petitioners filed a petition for mandamus before the Court of Appeals on February 25, 1999, naming both the PRC and the Board as respondents.
The Court of Appeals denied the petition on two main grounds:

The petitioners had not exhausted their administrative remedies by failing to appeal to the PRC within the 15-day period provided under Section 10 of R.A. No. 8544.
The Court held that the application of Section 17 of R.A. No. 8544 was precluded because the necessary conditions—the adoption of the new syllabi and the promulgation of the new rules and regulations—had not been met.

Notwithstanding these findings, the case was elevated to the Supreme Court for further review of the legal issues involved.

Whether the petitioners’ failure to exhaust administrative remedies by not appealing to the PRC within the 15-day period should bar their recourse to the courts via mandamus.

The question centers on whether the exhaustion rule is absolute or if exceptions apply when a purely legal issue is presented.

Whether it is proper to apply the 75% passing rating requirement from PD No. 97 when R.A. No. 8544, which took effect on March 25, 1998, explicitly provides for a 70% requirement.

This involves determining the appropriate standard for rating examinees during the transitional period.

Whether the non-adoption of the new syllabi and implementing rules at the time of the April 1998 examination justified the continued application of the old rating system.

The issue examines the proper interpretation of the transitory provisions under Section 33(2) of R.A. No. 8544.