G.R. No. 7487 - Barnuevo vs. Fuster

Republic Act No. 7842, enacted on July 25, 1994, established the Taguig-Pateros District Hospital under the administration and supervision of the Department of Health (DOH).
The hospital was specifically created as a one hundred-bed district hospital in Taguig, Metro Manila.

On September 8, 2006, President Gloria Macapagal-Arroyo issued Executive Order No. 567 (E.O. No. 567), which devolved the administration and supervision of TPDH from the DOH to the City of Taguig.
E.O. No. 567 was issued pursuant to the Local Government Code of 1991 (R.A. No. 7160) and the President’s authority to reorganize executive offices.
Following this, the City of Taguig’s Mayor Sigfrido R. Tinga issued Executive Order No. 053 (October 18, 2006) to formalize the take-over plan of TPDH operations by the City.
The City of Taguig and the DOH executed a Memorandum of Agreement (MOA) on October 23, 2006, detailing the transition and turn-over process.
Further, on January 3, 2007, Mayor Tinga created the TPDH Management Team via Executive Order No. 001 to implement the MOA, including auditing and inventorying supplies being turned over.

Petitioners, consisting of DOH employees assigned to TPDH and acting also as attorneys-in-fact for others, expressed formal objections to E.O. No. 567 through a position paper dated November 6, 2006, submitted to DOH Secretary Francisco Duque III.
The DOH took no action on this position paper, nor did the Office of the President respond to a letter requesting deferment of E.O. No. 567’s implementation.
Petitioners filed a Petition for Declaratory Relief on January 15, 2007, and amended it on January 26, 2007, to include petitions for prohibition and certiorari, seeking the declaration of E.O. No. 567 as unconstitutional and null and void.
The Regional Trial Court (RTC) denied their requests for Temporary Restraining Orders and deemed their prayer for Writ of Preliminary Injunction withdrawn.
The Municipal Government of Pateros was declared in default for failure to answer the petition.
The RTC resolved the case through position papers, focusing on legal issues only.

On January 2, 2008, the RTC upheld E.O. No. 567’s constitutionality and validity, ruling it enacted within the President’s supervisory power over executive entities and consistent with the Local Government Code’s devolution mandate.
The RTC held that R.A. No. 7842 did not prohibit devolution of TPDH to the City of Taguig, as local autonomy principles and devolution provisions were impliedly incorporated.
Further, the petitioners’ failure to exhaust administrative remedies such as appeals to the Civil Service Commission (CSC) was noted.
Petitioners’ Motion for Reconsideration was denied on April 14, 2008.

Petitioners elevated the case to the Supreme Court, challenging the constitutionality of E.O. No. 567 and questioning the doctrine of exhaustion of administrative remedies.