Case Summary (G.R. No. 112182)
Key Dates and Instruments
- Natural disaster events: Typhoons Ondoy and Pepeng (September–October 2009).
- Proclamation of state of calamity and issuance of E.O. No. 839 (October 2009).
- E.O. No. 845 (issued shortly after) lifted E.O. No. 839; the lifting affected the temporary relief but not the broader constitutional challenge to Section 14(e).
Applicable Constitutional and Statutory Provisions
- 1987 Constitution (applicable): Article VI, Section 23(2) (Congress may, in times of war or other national emergency, by law authorize the President, for a limited period and subject to restrictions, to exercise necessary powers); Article XII, Section 17 (in national emergency the State may, under reasonable terms, temporarily take over or direct operation of privately owned public utilities or businesses affected with public interest).
- Statute: Republic Act No. 8479, Section 14(e) (authorizing the Department of Energy to, in national emergency and under reasonable terms prescribed by it, temporarily take over or direct operations of persons or entities in the industry).
Procedural History
Pilipinas Shell filed a Petition for Prohibition, Mandamus, and Injunction in the Regional Trial Court (RTC), seeking, among other reliefs, a declaration that E.O. No. 839 and Section 14(e) of R.A. No. 8479 were unconstitutional. The RTC issued a temporary restraining order, then dismissed the petition as moot after the lifting of E.O. No. 839, but later (upon motion for reconsideration and after the filing of an amended petition) reversed the dismissal and eventually declared Section 14(e) void. The Court of Appeals affirmed. Petitioners then filed a Rule 45 petition to the Supreme Court.
Procedural Issues: Mode of Appeal and Admission of Amended Petition
- Mode of appeal: The Court of Appeals correctly dismissed petitioners’ appeal from the RTC for being taken via the wrong procedural remedy when the issues raised were pure questions of law; such issues should be elevated by petition for review under Rule 45.
- Admission of Amended Petition: The RTC properly admitted Pilipinas Shell’s Amended Petition as a matter of right under Rule 10, Section 2, because no responsive pleading had been served. Petitioners’ “Opposition with Motion to Admit Comment” did not constitute an admitted responsive pleading; a motion is ineffective to produce an admitted pleading unless the court acts on it. The Supreme Court upheld the RTC’s admission of the Amended Petition.
Justiciability and Mootness
- Mootness of E.O. No. 839: The question over the validity of that specific executive order became moot when it was lifted.
- Justiciability of statutory challenge: The constitutional challenge to Section 14(e) was not moot because the provision remained operative and could give rise to future executive orders; moreover, the case presented a demonstrable contrariety of legal rights (adequate to satisfy the actual case-or-controversy requirement) and implicated matters of public importance and potential repetition yet evading review. The Court thus proceeded to adjudicate the constitutionality of Section 14(e).
Res judicata and Prior Decisions
The Court rejected petitioners’ argument that prior Supreme Court jurisprudence (e.g., Garcia v. Corona) precluded this challenge by res judicata. The prior case involved a different provision (Section 19 of R.A. No. 8479) and different parties/issues; therefore the identity-of-claims requirement for res judicata was not satisfied.
Standard for Delegation of Emergency Powers
The Constitution authorizes Congress, in times of war or other national emergency, to by law authorize the President to exercise necessary emergency powers for a limited period and subject to restrictions. The Court read Article XII, Section 17 and Article VI, Section 23(2) together: Section 17’s reference to “the State” contemplates legislative action (Congress) prescribing reasonable terms; whether the President may exercise a particular takeover power depends on a valid legislative delegation.
Doctrine of Qualified Political Agency and Non‑delegable Presidential Powers
The Court applied the doctrine of qualified political agency: heads of executive departments act as the President’s alter egos and, in the ordinary course, their acts are presumptively the acts of the President unless expressly disapproved or repudiated. However, certain exceptional presidential powers (e.g., declaring martial law, suspending the privilege of the writ of habeas corpus, pardoning) require personal exercise by the President and are non‑delegable. The Court concluded that the temporary takeover of businesses affected with public interest during emergencies does not belong to that exceptional class.
Substantive Rationale: Constitutionality of Section 14(e)
- Delegation questioned: Pilipinas Shell argued that Section 14(e) improperly delegated takeover authority to the Department of Energy rather than preserving delegation exclusively to the President as the constitutional text suggests.
- Court’s conclusion: Section 14(e) is a constitutionally permissible delegation. Congress may vest the takeover authority in the executive branch and, consistent with the doctrine of qualified political agency, may vest operational authority in a department
Case Syllabus (G.R. No. 112182)
Case Caption, Court, and Decision Date
- En Banc; G.R. No. 209216.
- Decision rendered February 21, 2023.
- Ponencia authored by Justice Leonen, Senior Associate Justice; Chief Justice Gesmundo and Justices Hernando, Lazaro-Javier, Zalameda, Gaerlan, Rosario, J. Lopez, Dimaampao, Marquez, Kho, Jr., and Singh concurred.
- Separate concurring opinion by Justice Caguioa; Justices Inting and M. Lopez, no part.
Parties and Posture
- Petitioners: Executive Secretary Leandro Mendoza; Department of Energy–Department of Justice Joint Task Force; Department of Energy Secretary Angelo T. Reyes (petition filed by former Executive Secretary Leandro Mendoza and others).
- Respondent: Pilipinas Shell Petroleum Corporation.
- Relief sought below: Petition for Prohibition, Mandamus, and Injunction (with prayer for Temporary Restraining Order and/or Writ of Preliminary Injunction) filed by Pilipinas Shell challenging Executive Order No. 839 and Section 14(e) of Republic Act No. 8479.
- Petition before the Supreme Court: Petition for Review on Certiorari filed under Rule 45, assailing the Court of Appeals Decision and Resolution affirming the Regional Trial Court’s declaration that Section 14(e) of RA No. 8479 is unconstitutional.
Relevant Statutory and Constitutional Provisions Quoted or Discussed
- Section 14(e), Republic Act No. 8479 (Downstream Oil Industry Deregulation Act of 1998):
- Text: “In times of national emergency, when the public interest so requires, the DOE may, during the emergency and under reasonable terms prescribed by it, temporarily take over or direct the operation of any person or entity engaged in the Industry.”
- Section 14 (full section summarized in source): DOE monitoring, creation of DOE-DOJ Task Force, data reporting obligations, and takeover clause in subsection (e).
- Article XII, Section 17, 1987 Constitution:
- Text: “In times of national emergency, when the public interest so requires, the State may, during the emergency and under reasonable terms prescribed by it, temporarily take over or direct the operation of any privately owned public utility or business affected with public interest.”
- Article VI, Section 23(1)–(2), 1987 Constitution:
- (1) Congress’ sole power to declare existence of a state of war.
- (2) In times of war or other national emergency, Congress may, by law, authorize the President, for a limited period and subject to such restrictions as it may prescribe, to exercise powers necessary and proper to carry out a declared national policy; such powers cease upon next adjournment unless sooner withdrawn by resolution of Congress.
- Article VII, Section 17:
- President’s control of all executive departments and duty to ensure faithful execution of the laws.
- Rules of Civil Procedure provisions invoked in the case:
- Rule 10, Sections 2 and 3 (amendments as a matter of right and amendments by leave of court).
- Rule 41, Section 2(a) (ordinary appeal to Court of Appeals).
- Rule 45 (petition for review on certiorari).
- Rule 50, Section 2 (dismissal of improper appeal raising pure questions of law).
- Rule 63, Section 1 (declaratory relief).
Factual Background and Timeline (as reflected in the source)
- September–October 2009: Typhoons Ondoy and Pepeng ravaged Luzon, severely affecting over 9 million people and causing many casualties.
- October 2, 2009: President Gloria Macapagal-Arroyo issued Proclamation No. 1898 declaring a state of calamity.
- Executive Order No. 839 (2009) issued pursuant to Section 14(e) of RA No. 8479 directing oil industry players to retain retail prices prevailing on October 15, 2009, for the duration of the state of emergency in Luzon.
- Pilipinas Shell filed a Petition for Prohibition, Mandamus, and Injunction in the Regional Trial Court (TRO sought) challenging Executive Order No. 839 and Section 14(e) as an unreasonable, oppressive, and invalid delegation of emergency powers.
- November 6, 2009: RTC issued summons to Executive Secretary Ermita and others to file an answer.
- November 13, 2009: RTC granted Pilipinas Shell’s application for a Temporary Restraining Order enjoining implementation of EO No. 839.
- Shortly thereafter (two days after the TRO order, per source), Executive Order No. 845 was issued, lifting EO No. 839 and discontinuing the oil price freeze.
- December 1, 2009: Petitioners moved for reconsideration of the RTC’s TRO order; Pilipinas Shell moved to declare respondents in default for failure to file a responsive pleading.
- January 5, 2010: RTC dismissed Pilipinas Shell’s petition as moot in view of the lifting of EO 839 by EO 845.
- April 23, 2010: While reconsideration was pending, Pilipinas Shell filed an Amended Petition for Declaratory Relief seeking to declare Section 14(e) of RA No. 8479 null; the Amended Petition dropped the name of Executive Secretary Ermita and impleaded Executive Secretary Mendoza; the Amended Petition dropped Energy Secretary Reyes’ name but the lower courts and the present petition retained his name.
- May 7, 2010: RTC granted Pilipinas Shell’s Motion for Reconsideration, vacated the January 5 dismissal, and ordered respondents to file responsive pleadings to the Amended Petition.
- August 23, 2010: RTC issued Decision granting Pilipinas Shell’s Amended Petition, declaring Section 14(e) of RA No. 8479 void and unconstitutional.
- Petitioners appealed to the Court of Appeals; June 25, 2013 CA Decision affirmed RTC, declaring Section 14(e) unconstitutional and held appeal should have been filed by Rule 45 instead of ordinary appeal (wrong mode of appeal).
- Petitioners filed Petition for Review on Certiorari under Rule 45 to the Supreme Court; Pilipinas Shell filed Comment; petitioners filed Reply.
Issues Framed by the Supreme Court (as stated in the ponencia)
- Whether the Court of Appeals erred in dismissing petitioners’ appeal for being the improper mode of appeal.
- Whether res judicata will apply to bar the present challenge.
- Whether the issue is moot.
- Whether the Petition for Declaratory Relief was the proper remedy to assail the constitutionality of Section 14(e) of RA No. 8479.
- Whether Section 14(e) of RA No. 8479 is unconstitutional.
Procedural Questions and the Court’s Findings
- Nature of questions of law vs. fact and appropriate mode of appeal:
- A question of law is resolvable without examination of probative value of evidence; a question of fact requires review of evidence.
- The central issues (constitutionality of Section 14(e), mootness, res judicata, admission of Amended Petition, requisites of declaratory relief) involve pure questions of law; thus, Rule 45 petition for review on certiorari to the Supreme Court was the proper remedy. The Court of Appeals correctly dismissed the appeal insofar as it was an improper mode of appeal under Rule 41.
- Rule 50, Section 2 supports dismissal of appeals to the Court of Appeals that raise only questions of law.
- Admission of Amended Petition before RTC:
- Rule