GALICTO v.

AQUINO (2012)
G.R. No. 193978 | February 28, 2012 | BRION, J.:

Petitioner: Jelbert Galicto

Respondent: HE President Benigno Aquino III, et. al.

SUMMARY:

In his first State of the Nation Address, Pres. Aquino exposed anomalies in the financial management of the
Metropolitan Waterworks and Sewerage System (MWSS), the National Power Corporation (NPC) and the
National Food Authority (NFA). The Senate conducted legislative inquiries on the matter and issued a
Resolution which urged the President to order the immediate suspension of the unusually large and excessive
allowances, bonuses, incentives and other perks of members of the GOCCs and GFIs. Thus, President Aquino
issued EO No. 7 which imposed a moratorium on increases in salaries, allowances and other benefits of
officials and employees of GOCCs and GFIs and directs the suspension of all allowances, bonuses and
incentives of GOCC and GFI officials until Dec. 31, 2010. The petitioner in this case questioned the
constitutionality of EO 7 in his capacity as a lawyer and as an employee of PhilHealth for allegedly violating his
right to property without due process of law.

The issue in this case is whether or not the petitioner (Galicto) had legal standing to question the Executive
Order.

The Supreme Court ruled that the petitioner did NOT have legal standing to question the executive order.

A party is allowed to "raise a constitutional question" when the following requisites are present: (1) he can show
that he will personally suffer some actual or threatened injury because of the allegedly illegal conduct of the
government; (2) the injury is fairly traceable to the challenged action; and (3) the injury is likely to be redressed
by a favorable action.

The interest must be "material interest, meaning, an interest in issue and to be affected by the decree, as
distinguished from mere interest in the question involved, or a mere incidental interest. Real interest means
substantial interest, as distinguished from a mere expectancy or a future, contingent, subordinate or
consequential interest.

In this case, the petitioner was not able to demonstrate that he has a personal stake or material interest in the
outcome of the case because his interest, if any, is only speculative and based on mere expectancy. This is
because the suspension of future increases in salaries is based on contingent events. It is also a rule that he has
no vested rights to the said salary increases. Neither can the petitioner anchor his claim on the fact that he s a
member of the bar in good standing who has an interest in ensuring that laws and orders of the government are
legally and validly issued. The Court previously held in the case of IBP v. Zamora that this is too general of an
interest which is shared by other groups and by every citizen.

FACTS:
 July 26, 2010, Pres. Aquino made public in his first SONA the alleged excessive allowances, bonuses and
other benefits of Officers and Members of the Board of Directors of the Manila Waterworks and
Sewerage System – a (GOCC) which has been unable to meet its standing obligations. Subsequently, the
Senate of the Philippines (Senate), through the Senate Committee on Government Corporations and Public
Enterprises, conducted an inquiry in aid of legislation on the reported excessive salaries, allowances, and
other benefits of GOCCs and government financial institutions (GFIs).
 Based on its findings that "officials and governing boards of various [GOCCs] and [GFIs] have been
granting themselves unwarranted allowances, bonuses, incentives, stock options, and other benefits
[as well as other] irregular and abusive practices," the Senate issued Senate Resolution No. 17 "urging
the President to order the immediate suspension of the unusually large and apparently excessive allowances,
bonuses, incentives and other perks of members of the governing boards of [GOCCs] and [GFIs]."
 September 8, 2010 – issued EO 7, entitled "Directing the Rationalization of the Compensation and Position
Classification System in the [GOCCs] and [GFIs], and for Other Purposes."
 o EO 7 provided for the guiding principles and framework to establish a fixed compensation and
position classification system for GOCCs and GFIs.
o A Task Force was also created to review all remunerations of GOCC and GFI employees and
officers, while GOCCs and GFIs were ordered to submit to the Task Force information regarding
their compensation.
o EO 7 ordered (1) a moratorium on the increases in the salaries and other forms of compensation,
except salary adjustments under EO 8011 and EO 900, of all GOCC and GFI employees for an
indefinite period to be set by the President,9 and (2) a suspension of all allowances, bonuses and
incentives of members of the Board of Directors/Trustees until December 31, 2010.
 EO 7 was published on September 10, 2010.11 It took effect on September 25, 2010 and precluded the
Board of Directors, Trustees and/or Officers of GOCCs from granting and releasing bonuses and
allowances to members of the board of directors, and from increasing salary rates of and granting
new or additional benefits and allowances to their employees.
 The petitioner claims that as a PhilHealth employee, he is affected by the implementation of EO 7,
which was issued with grave abuse of discretion amounting to lack or excess of jurisdiction, based on the
following arguments:
o EO is null and void for lack of legal basis due to the ff:
 PD 985 is not applicable as basis for EO 7 because the GOCCs were subsequently
granted the power to fix compensation long after such power has been revoked by PD
1597 and RA 6758.
 The GOCCs do not need to have its compensation plans, rates and policies reviewed by
the DBM and approved by the President because PD 1597 requires only the GOCCs to
report to the office to the president their compensation plans and rates but the same does
not give the president the power of control over the fiscal power of the GOCCs.
 CJR No. 4 is not applicable as legal basis because it had not ripened into law, the same
not having been published.
 ASSUMING ARGUENDO THAT J.R. NO. 1, S. 2004 (sic) AND J.R. 4, S. 2009 ARE
VALID, STILL THEY ARE NOT APPLICABLE AS LEGAL BASIS BECAUSE THEY
ARE NOT LAWS WHICH MAY VALIDLY DELEGATE POWER TO THE
PRESIDENT TO SUSPEND THE POWER OF THE BOARD TO FIX
COMPENSATION.
 EXECUTIVE ORDER NO. 7 IS INVALID FOR DIVESTING THE BOARD OF
DIRECTORS OF [THE] GOCCS OF THEIR POWER TO FIX THE COMPENSATION,
A POWER WHICH IS A LEGISLATIVE GRANT AND WHICH COULD NOT BE
REVOKED OR MODIFIED BY AN EXECUTIVE FIAT.
 EXECUTIVE ORDER NO. 7 IS BY SUBSTANCE A LAW, WHICH IS A
DEROGATION OF CONGRESSIONAL PREROGATIVE AND IS THEREFORE
UNCONSTITUTIONAL.
 THE ACTS OF SUSPENDING AND IMPOSING MORATORIUM ARE ULTRA
VIRES ACTS BECAUSE J.R. NO. 4 DOES NOT EXPRESSLY AUTHORIZE THE
PRESIDENT TO EXERCISE SUCH POWERS.
 EXECUTIVE ORDER NO. 7 IS AN INVALID ISSUANCE BECAUSE IT HAS NO
SUFFICIENT STANDARDS AND IS THEREFORE ARBITRARY, UNREASONABLE
AND A VIOLATION OF SUBSTANTIVE DUE PROCESS.
 EXECUTIVE ORDER NO. 7 INVOLVES THE DETERMINATION AND
DISCRETION AS TO WHAT THE LAW SHALL BE AND IS THEREFORE INVALID
FOR ITS USURPATION OF LEGISLATIVE POWER.
 CONSISTENT WITH THE DECISION OF THE SUPREME COURT IN PIMENTEL V.
AGUIRRE CASE, EXECUTIVE ORDER NO. 7 IS ONLY DIRECTORY AND NOT
MANDATORY.
o Respondents argument – Petitioner lacks legal standing.
 The respondents also raised substantive defenses to support the validity of EO 7. They claim that the
President exercises control over the governing boards of the GOCCs and GFIs; thus, he can fix their
compensation packages. In addition, EO 7 was issued in accordance with law for the purpose of controlling
the grant of excessive salaries, allowances, incentives and other benefits to GOCC and GFI employees.
They also advocate the validity of Joint Resolution (J.R.) No. 4, which they point to as the authority for
issuing EO 7.14
 Meanwhile, on June 6, 2011, Congress enacted Republic Act (R.A.) No. 10149,15 otherwise known as the
"GOCC Governance Act of 2011." Section 11 of RA 10149 expressly authorizes the President to fix the
compensation framework of GOCCs and GFIs.

HELD:
 We resolve to DISMISS the petition for its patent formal and procedural infirmities, and for having
been mooted by subsequent events.
 Certiorari is not the proper remedy -- Under the Rules of Court, petitions for Certiorari and
Prohibition are availed of to question judicial, quasi-judicial and mandatory acts. Since the issuance of
an EO is not judicial, quasi-judicial or a mandatory act, a petition for certiorari and prohibition is an
incorrect remedy; instead a petition for declaratory relief under Rule 63 of the Rules of Court, filed
with the Regional Trial Court (RTC), is the proper recourse to assail the validity of EO 7: Section 1.
Who may file petition.
 Any person interested under a deed, will, contract or other written instrument, whose rights are affected
by a statute, executive order or regulation, ordinance, or any other governmental regulation may, before
breach or violation thereof, bring an action in the appropriate Regional Trial Court to determine any
question of construction or validity arising, and for a declaration of his rights or duties, thereunder.
 Liga ng mga Barangay National v. City Mayor of Manila is a case in point.1 In Liga, we dismissed the
petition for certiorari to set aside an EO issued by a City Mayor and insisted that a petition for
declaratory relief should have been filed with the RTC. (SEE SEC. 1, RULE 65, 1997 Consti)
o Elsewise stated, for a writ of certiorari to issue, the following requisites must concur: (1) it
must be directed against a tribunal, board, or officer exercising judicial or quasi-judicial
functions; (2) the tribunal, board, or officer must have acted without or in excess of
jurisdiction or with grave abuse of discretion amounting [to] lack or excess of jurisdiction; and
(3) there is no appeal or any plain, speedy, and adequate remedy in the ordinary course of law.
 A respondent is said to be exercising judicial function where he has the power to determine what the
law is and what the legal rights of the parties are, and then undertakes to determine these questions and
adjudicate upon the rights of the parties.
 Quasi-judicial function, on the other hand, is "a term which applies to the actions, discretion, etc., of
public administrative officers or bodies … required to investigate facts or ascertain the existence of
facts, hold hearings, and draw conclusions from them as a basis for their official action and to exercise
discretion of a judicial nature."
 Before a tribunal, board, or officer may exercise judicial or quasi-judicial acts, it is necessary that there
be a law that gives rise to some specific rights of persons or property under which adverse claims to
such rights are made, and the controversy ensuing therefrom is brought before a tribunal, board, or
officer clothed with power and authority to determine the law and adjudicate the respective rights of
the contending parties.
 The respondents do not fall within the ambit of tribunal, board, or officer exercising judicial or
quasi-judicial functions. As correctly pointed out by the respondents, the enactment by the City
Council of Manila of the assailed ordinance and the issuance by respondent Mayor of the questioned
executive order were done in the exercise of legislative and executive functions, respectively, and not
of judicial or quasi-judicial functions. On this score alone, certiorari will not lie.
 Second, although the instant petition is styled as a petition for certiorari, in essence, it seeks the
declaration by this Court of the unconstitutionality or illegality of the questioned ordinance and
executive order. It, thus, partakes of the nature of a petition for declaratory relief over which this Court
has only appellate, not original, jurisdiction. Section 5, Article VIII of the Constitution provides: “Sec.
5. The Supreme Court shall have the following powers: (1) Exercise original jurisdiction over cases
affecting ambassadors, other public ministers and consuls, and over petitions for certiorari, prohibition,
mandamus, quo warranto, and habeas corpus. (2) Review, revise, reverse, modify, or affirm on appeal
or certiorari as the law or the Rules of Court may provide, final judgments and orders of lower courts
in: (a) All cases in which the constitutionality or validity of any treaty, international or executive
agreement, law, presidential decree, proclamation, order, instruction, ordinance, or regulation is in
question. As such, this petition must necessarily fail, as this Court does not have original jurisdiction
over a petition for declaratory relief even if only questions of law are involved.
 Likewise, in Southern Hemisphere Engagement Network, Inc. v. Anti Terrorism Council, we similarly
dismissed the petitions for certiorari and prohibition challenging the constitutionality of R.A. No. 9372,
otherwise known as the "Human Security Act of 2007," since the respondents therein (members of the
Anti-Terrorism Council) did not exercise judicial or quasi-judicial functions.
  While we have recognized in the past that we can exercise the discretion and rulemaking authority we
are granted under the Constitution, and set aside procedural considerations to permit parties to bring a
suit before us at the first instance through certiorari and/or prohibition, this liberal policy remains to be
an exception to the general rule, and thus, has its limits.
o In Concepcion v. Commission on Elections (COMELEC), we emphasized the importance of
availing of the proper remedies and cautioned against the wrongful use of certiorari in order to
assail the quasi-legislative acts of the COMELEC, especially by the wrong party. In ruling
that liberality and the transcendental doctrine cannot trump blatant disregard of procedural
rules, and considering that the petitioner had other available remedies (such as a petition for
declaratory relief with the appropriate RTC under the terms of Rule 63 of the Rules of Court),
as in this case, we categorically ruled: The petitioner’s unusual approaches and use of Rule 65
of the Rules of Court do not appear to us to be the result of any error in reading Rule 65, given
the way the petition was crafted. Rather, it was a backdoor approach to achieve what the
petitioner could not directly do in his individual capacity under Rule 65. It was, at the very
least, an attempted bypass of other available, albeit lengthier, modes of review that the Rules
of Court provide. While we stop short of concluding that the petitioner’s approaches constitute
an abuse of process through a manipulative reading and application of the Rules of Court, we
nevertheless resolve that the petition should be dismissed for its blatant violation of the Rules.
The transgressions alleged in a petition, however weighty they may sound, cannot be
justifications for blatantly disregarding the rules of procedure, particularly when remedial
measures were available under these same rules to achieve the petitioner’s objectives. For our
part, we cannot and should not – in the name of liberality and the "transcendental importance"
doctrine – entertain these types of petitions. As we held in the very recent case of Lozano, et
al. vs. Nograles, albeit from a different perspective, our liberal approach has its limits and
should not be abused

B. Petitioner lacks locus standi.

 "Locus standi or legal standing has been defined as a personal and substantial interest in a case such
that the party has sustained or will sustain direct injury as a result of the governmental act that is being
challenged. The gist of the question on standing is whether a party alleges such personal stake in the
outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of
issues upon which the court depends for illumination of difficult constitutional questions."24 This
requirement of standing relates to the constitutional mandate that this Court settle only actual cases or
controversies.
 Thus, as a general rule, a party is allowed to "raise a constitutional question" when (1) he can show that
he will personally suffer some actual or threatened injury because of the allegedly illegal conduct of the
government; (2) the injury is fairly traceable to the challenged action; and (3) the injury is likely to be
redressed by a favorable action.
 Jurisprudence defines interest as "material interest, an interest in issue and to be affected by the
decree, as distinguished from mere interest in the question involved, or a mere incidental interest. By
real interest is meant a present substantial interest, as distinguished from a mere expectancy or a future,
contingent, subordinate, or consequential interest."
 To support his claim that he has locus standi to file the present petition, the petitioner contends that as
an employee of PhilHealth, he "stands to be prejudiced by [EO] 7, which suspends or imposes a
moratorium on the grants of salary increases or new or increased benefits to officers and employees of
GOCC[s] and x x x curtail[s] the prerogative of those officers who are to fix and determine his
compensation."28 The petitioner also claims that he has standing as a member of the bar in good
standing who has an interest in ensuring that laws and orders of the Philippine government are legally
and validly issued and implemented.
 The respondents meanwhile argue that the petitioner is not a real party-in-interest since future
increases in salaries and other benefits are merely contingent events or expectancies. The
petitioner, too, is not asserting a public right for which he is entitled to seek judicial protection. Section
9 of EO 7 reads: Section 9. Moratorium on Increases in Salaries, Allowances, Incentives and Other
Benefits. –Moratorium on increases in the rates of salaries, and the grant of new increases in the rates
of allowances, incentives and other benefits, except salary adjustments pursuant to Executive Order
No. 8011 dated June 17, 2009 and Executive Order No. 900 dated June 23, 2010, are hereby imposed
until specifically authorized by the President.
  In the present case, we are not convinced that the petitioner has demonstrated that he has a personal
stake or material interest in the outcome of the case because his interest, if any, is speculative and
based on a mere expectancy. In this case, the curtailment of future increases in his salaries and other
benefits cannot but be characterized as contingent events or expectancies. To be sure, he has no vested
rights to salary increases and, therefore, the absence of such right deprives the petitioner of legal
standing to assail EO 7.
 It has been held that as to the element of injury, such aspect is not something that just anybody with
some grievance or pain may assert. It has to be direct and substantial to make it worth the court’s time,
as well as the effort of inquiry into the constitutionality of the acts of another department of
government.
 If the asserted injury is more imagined than real, or is merely superficial and insubstantial, then the
courts may end up being importuned to decide a matter that does not really justify such an excursion
into constitutional adjudication.
 The rationale for this constitutional requirement of locus standi is by no means trifle. Not only does it
assure the vigorous adversary presentation of the case; more importantly, it must suffice to warrant the
Judiciary’s overruling the determination of a coordinate, democratically elected organ of government,
such as the President, and the clear approval by Congress, in this case. Indeed, the rationale goes to the
very essence of representative democracies.
 Neither can the lack of locus standi be cured by the petitioner’s claim that he is instituting the
present petition as a member of the bar in good standing who has an interest in ensuring that
laws and orders of the Philippine government are legally and validly issued. This supposed interest
has been branded by the Court in Integrated Bar of the Phils. (IBP) v. Hon. Zamora, "as too general an
interest which is shared by other groups and [by] the whole citizenry.
o Thus, the Court ruled in IBP that the mere invocation by the IBP of its duty to preserve
the rule of law and nothing more, while undoubtedly true, is not sufficient to clothe it
with standing in that case.
o The Court made a similar ruling in Prof. David v. Pres. Macapagal-Arroyo and held that the
petitioners therein, who are national officers of the IBP, have no legal standing, having failed
to allege any direct or potential injury which the IBP, as an institution, or its members may
suffer as a consequence of the issuance of Presidential Proclamation No. 1017 and General
Order No. 5.
 We note that while the petition raises vital constitutional and statutory questions concerning the power
of the President to fix the compensation packages of GOCCs and GFIs with possible implications on
their officials and employees, the same cannot "infuse" or give the petitioner locus standi under the
transcendental importance or paramount public interest doctrine.
 In Velarde v. Social Justice Society,36 we held that even if the Court could have exempted the case
from the stringent locus standi requirement, such heroic effort would be futile because the
transcendental issue could not be resolved any way, due to procedural infirmities and shortcomings, as
in the present case.37 In other words, giving due course to the present petition which is saddled with
formal and procedural infirmities explained above in this Resolution, cannot but be an exercise in
futility that does not merit the Court’s liberality. As we emphasized in Lozano v. Nograles,38 "while
the Court has taken an increasingly liberal approach to the rule of locus standi, evolving from the
stringent requirements of ‘personal injury’ to the broader ‘transcendental importance’ doctrine, such
liberality is not to be abused."
 Finally, since the petitioner has failed to demonstrate a material and personal interest in the issue in
dispute, he cannot also be considered to have filed the present case as a representative of PhilHealth. In
this regard, we cannot ignore or excuse the blatant failure of the petitioner to provide a Board
Resolution or a Secretary’s Certificate from PhilHealth to act as its representative.

D. The petition has been mooted by supervening events.

 Because of the transitory nature of EO 7, it has been pointed out that the present case has already
been rendered moot by these supervening events: (1) the lapse on December 31, 2010 of Section 10 of
EO 7 that suspended the allowances and bonuses of the directors and trustees of GOCCs and GFIs; and
(2) the enactment of R.A. No. 10149 amending the provisions in the charters of GOCCs and GFIs
empowering their board of directors/trustees to determine their own compensation system, in favor of
the grant of authority to the President to perform this act.
 With the enactment of the GOCC Governance Act of 2011, the President is now authorized to fix
the compensation framework of GOCCs and GFIs. The pertinent provisions read: Section 5. “There
is hereby created an advisory, monitoring, and oversight body with authority to formulate, implement
 and coordinate policies to be known as the Governance Commission for GOCCs (“GCG”) which shall
be attached to the Office of the President. The GCG shall have the following powers and functions:h)
Conduct compensation studies, develop and recommend to the President a competitive compensation
and remuneration system which shall attract and retain talent, at the same time allowing the GOCC to
be financially sound and sustainable. The GCG, after conducting a compensation study, shall develop a
Compensation and Position Classification System which shall apply to all officers and employees of
the GOCCs whether under the Salary Standardization Law or exempt therefrom and shall consist of
classes of positions grouped into such categories as the GCG may determine, subject to approval of the
President.— All positions in the Positions Classification System, as determined by the GCG and as
approved by the President, shall be allocated to their proper position titles and salary grades in
accordance with an Index of Occupational Services, Position Titles and Salary Grades of the
Compensation and Position Classification System, which shall be prepared by the GCG and approved
by the President. [N]o GOCC shall be exempt from the coverage of the Compensation and Position
Classification System developed by the GCG under this Act.
 As may be gleaned from these provisions, the new law amended R.A. No. 7875 and other laws that
enabled certain GOCCs and GFIs to fix their own compensation frameworks; the law now authorizes
the President to fix the compensation and position classification system for all GOCCs and GFIs, as
well as other entities covered by the law. This means that, the President can now reissue an EO
containing these same provisions without any legal constraints.
 A moot case is "one that ceases to present a justiciable controversy by virtue of supervening events, so
that a declaration thereon would be of no practical use or value.
o "[A]n action is considered ‘moot’ when it no longer presents a justiciable controversy
because the issues involved have become academic or dead[,] or when the matter in dispute
has already been resolved and hence, one is not entitled to judicial intervention unless the
issue is likely to be raised again between the parties. Simply stated, there is nothing for the
court to resolve as [its] determination has been overtaken by subsequent events."
 This is the present situation here. Congress, thru R.A. No. 10149, has expressly empowered the
President to establish the compensation systems of GOCCs and GFIs. For the Court to still rule
upon the supposed unconstitutionality of EO 7 will merely be an academic exercise. Any further
discussion of the constitutionality of EO 7 serves no useful purpose since such issue is moot in its face
in light of the enactment of R.A. No. 10149. In the words of the eminent constitutional law expert, Fr.
Joaquin Bernas, S.J., "the Court normally [will not] entertain a petition touching on an issue that has
become moot because x x x there would [be] no longer x x x a ‘flesh and blood’ case for the Court to
resolve."
 All told, in view of the supervening events rendering the petition moot, as well as its patent formal and
procedural infirmities, we no longer see any reason for the Court to resolve the other issues raised in
the certiorari petition.

ARTURO D. BRION
Associate Justice

WE CONCUR:

RENATO C. CORONA (Chief Justice)

ANTONIO T. CARPIO
PRESBITERO J. VELASCO, JR.
TERESITA J. LEONARDO-DE CASTRO*
DIOSDADO M. PERALTA
LUCAS P. BERSAMIN
MARIANO C. DEL CASTILLO**
ROBERTO A. ABAD
MARTIN S. VILLARAMA, JR.
JOSE PORTUGAL PEREZ
JOSE CATRAL MENDOZA
MARIA LOURDES P. A. SERENO**
BIENVENIDO L. REYES
ESTELA M. PERLAS-BERNABE
SEPARATE CONCURRING OPINION OF CHIEF JUSTICE CORONA:
 Most GOCCs are incurring significant financial losses. Budgetary support to the total government
corporate sector (including government financial institutions, social security institutions, and GOCCs
providing goods and services to the public) amounted to P80.4 billion during 2000–2004.
 In addition, indirect support, in the form of guarantees on GOCC obligations, is also in the billions of pesos.
In the past 5 years, there has been a noticeable increase in the aggregate deficit of the 14 monitored
GOCCs1 , bringing their financial viability into question. While the 14 monitored GOCCs’ current and
capital expenditures fluctuated around 6% of GDP, revenues have fallen from 5% to 4.1% of GDP over
2000–2004, increasing the deficit of the monitored GOCCs from 0.6% to 1.8% of GDP over the same
period.
 In 2004, the monitored GOCCs’ consolidated deficit was P85.4 billion, a more than fourfold increase from
the 2000 level of P19.2 billion. The 2004 deficit is already about the same size as the potential new
revenues collected through the expanded value-added tax law. There are various reasons for the ballooning
GOCC deficits, including (i) failure to adjust tariff rates, (ii) large capital requirements, and (iii) operational
and management inefficiencies.
 Accountability in public office requires rationality and efficiency in both administrative and financial
operations of all (GOCCs) included. As a corollary, public funds must be utilized in a way that will promote
transparency, accountability and prudence.
 The nation was recently informed that GOCCs, most of which enjoyed privileges not afforded to other
offices and agencies of the National Government, suffer from serious fiscal deficit. Yet, officers and
employees of these GOCCs continue to receive hefty perks and excessive allowances presenting a stark
disconnect and causing the further depletion of limited resources. In the face of such situation, where the
President as Chief Executive makes a decisive move to stave off the financial hemorrhage and
administrative inefficiency of government corporations, the Court should not invalidate the Chief
Executive’s action without a clear showing of grave abuse of discretion on his part.
 The ponencia of Justice Arturo D. Brion dismisses the petition for being replete with formal and procedural
defects and for having been rendered moot by supervening events.
 Fundamental considerations governing the exercise of the power of judicial review require the Court to
exercise restraint in nullifying the act of a co-equal and coordinate branch. Here, the justiciability doctrines
of standing and mootness work against petitioner.
 The President as Chief Executive has the legal authority to issue EO 7. Furthermore, petitioner failed to
show that the President committed grave abuse of discretion in directing the rationalization of the
compensation and position classification system in GOCCs and GFIs.
 Lack of Standing and Mootness -- The power of judicial review is a sword that must be unsheathed with
restraint. To ensure this, certain justiciability doctrines must be complied with as a prerequisite for the
Court’s exercise of its awesome power to declare the act of a co-equal branch invalid for being
unconstitutional. These doctrines are important as they are intertwined with the principle of separation of
powers. They help define the judicial role; they determine when it is appropriate for courts to review (a
legal issue) and when it is necessary to defer to the other branches of government.
 Among the justiciability doctrines are standing and mootness. Petitioner failed to observe both.
 Courts do not decide all kinds of cases dumped on their laps and do not open their doors to all parties or
entities claiming a grievance.
 Locus standi is intended to assure a vigorous adversary presentation of the case. More importantly, it
warrants the judiciary’s overruling the determination of a coordinate, democratically elected organ of
government. It thus goes to the very essence of representative democracies.
 Petitioner, for himself, asserts his right to question the constitutionality of EO 7 on two grounds. First, as an
employee of PhilHealth, he allegedly stands to be prejudiced by EO 7 insofar as it suspends or imposes a
moratorium on the grant of salary increases and other benefits to employees and officials of GOCCs and
GFIs and curtails the prerogatives of the officers responsible for the fixing and determination of his
compensation. Second, as a lawyer, he claims to have an interest in making sure that laws and orders by
government officials are legally and validly issued and implemented.
 Petitioner cannot sufficiently anchor his standing to bring this action on account of his employment
in PhilHealth, a GOCC covered by EO 7. He cannot reasonably expect this Court to symphatize with his
lament that the law impedes or threatens to impede his right to receive future increases as well as the right
of members of the board of directors of Philhealth to allowances and bonuses.
 The irreducible minimum condition for the exercise of judicial power is a requirement that a party "show he
personally has suffered some actual or threatened injury" to his rights. A party who assails the
constitutionality of a statute or an official act must have a direct and personal interest. He must show not
only that the law or any governmental act is invalid, but also that he sustained or is in immediate danger of
 sustaining some direct injury as a result of its enforcement, and not merely that he suffers thereby in some
indefinite way. He must show that he has been or is about to be denied some right or privilege to which he
is lawfully entitled or that he is about to be subjected to some burdens or penalties by reason of the statute
or act complained of.
 For this reason, petitioner’s reliance on his status as PhilHealth employee, without more, is a frail thread
that fails to sustain the burden of locus standi required of anyone who may properly invoke the Court’s
power of judicial review.
 EO 7 simply imposes a moratorium on increases in salaries, allowances and other benefits of officials
and employees of GOCCs and GFIs and directs the suspension of all allowances, bonuses and incentives of
GOCC and GFI officials. Moratorium is defined as an authorized postponement in the performance of
an obligation or a suspension of a specific activity. Section 9 of EO 7 is not a permanent prohibition on
petitioner’s perceived right to receive future increases. Nor is it an absolute ban on salary increases as it
ensures that, like all other officials and employees of the government, officials and employees of GOCCs
and GFIs will continue to enjoy the salary increases mandated under EO 8011.
 While one’s employment is a constitutionally-protected property right, petitioner does not claim that
his employment is at risk under EO 7. Petitioner is simply concerned about his entitlement to future
salary increases. However, a public officer has a vested right only to salaries already earned or accrued.
Salary increases are a mere expectancy. They are by nature volatile and dependent on numerous variables,
including the company’s fiscal situation, the employee’s future performance on the job, or the employee’s
continued stay in a position
o Thus, petitioner does not have a "right" to an increase in salary. There is no vested right to
salary increases. There must be a lawful decree or order supporting an employee’s claim. In this
case, petitioner failed to point to any lawful decree or order supporting his entitlement to future
increases in salary, as no such decree or order yet exists.
o It is misleading because, by re-working the concept of injury, it diverts the focus from the required
right-centric approach to the concept of injury as an element of locus standi. Injury or threat of
injury, as an element of legal standing, refers to a denial of a right or privilege. It does not include
the denial of a reasonable expectation. The argument is likewise incorrect because petitioner’s
reasonable expectation of any future salary increase is subject to presidential approval. Even
without Section 9 of EO 7, the President may disallow any salary increase in RA 675822 -exempt
entities. Petitioner cannot also lay claim to any direct personal injury to his right or interest arising
from the suspension under Section 10 of EO 7 of allowances and bonuses enjoyed by the board of
directors/trustees of GOCCs and GFIs. He is not a member of the board of directors of Philhealth.
 Neither can petitioner rely on his membership in the Philippine Bar to support his legal standing. Mere
interest as a member of the Bar and an empty invocation of a duty in "making sure that laws and orders by
officials of the Philippine government are legally issued and implemented" does not suffice to clothe one
with standing.
 It is clear from the foregoing that petitioner failed to satisfy the irreducible minimum condition that will
trigger the exercise of judicial power. Lacking a leg on which he may base his personality to bring this
action, petitioner’s claim of sufficient standing should fail.
 Even assuming that petitioner had standing at the time he commenced this petition, subsequent events have
rendered his petition moot.
 Moreover, as the ponencia correctly ruled, the enactment of RA28 1014929 has rendered the issue as to the
validity of EO 7 effectively moot. With RA 10149, Congress affirmed the power of the President as
enunciated in EO 7 to set guidelines and components of a rationalized compensation and position
classification for all GOCC and GFI employees. If a case is moot, there is no longer an actual
controversy between adverse litigants.30 Also, if events subsequent to the initiation of the lawsuit
have resolved the matter, then the decision of the court on that issue is not likely to have any
meaningful effect.
 With the recognition that RA 10149 mooted the challenge to EO 7, the Court must act with circumspection
and prudence, bearing in mind that due respect for a co-equal branch necessitates that the presumption of
legality and constitutionality afforded to the said provisions should no longer be disturbed.

Consistency with Existing Laws

 Provisions of law should be read and understood in their entirety and all parts thereof should be
seen as constituting a coherent whole. In this context, the recognition under Section 9 of Joint
Resolution No. 4 of the authority granted to exempt entities like Philhealth to determine their own
compensation and position classification system seeks to exclude them from the salary adjustments
provided in Joint Resolution No. 4. This would have the effect of retaining the existing compensation
 levels in the said exempt entities at that time. It would prevent both diminution, in case their existing
compensation levels are higher than the salary adjustments, and also increase, which would have
enlarged the pay disparity between those covered by RA 6758 and exempt entities. To ensure
observance of the distinction between RA 6758-covered and RA 6758-exempt entities and, at the same
time, forestall any unnecessary or excessive dissimilarity in compensation and position classification
systems may occur as a result of the distinctions, exempt entities are required to observe the policies,
parameters and guidelines governing position classification, salary rates, categories and rates of
allowances, benefits and incentives prescribed by the President. This is a recognition by Congress of
the authority of the President to issue policies, parameters and guidelines that will govern the
determination by exempt entities of their respective compensation and position classification systems.
As a further safeguard against any abuse or misuse of their exclusion from RA 6758, any increase in
existing salary rates of exempt entities are mandated to have the imprimatur of the President, upon the
recommendation of the DBM. This second proviso complements and enhances the first proviso. It
gives the President the opportunity to ascertain whether salary increases in exempt entities are in
accordance with the prescribed policies, parameters and guidelines on compensation and position
classification system. As a final proviso, exempt entities which still follow the salary rates for positions
covered by RA 6758 are entitled to the salary adjustments under Joint Resolution No. 4, until such time
as they have implemented their own compensation and position classification system. Again, this
acknowledges the status of exempt entities and prevents the effective diminution of their salary rates.
 If no vested right to salary generally pertains to a public officer, there is no cogent reason to support the
claim to a right to future salary increase. The grant of any salary increase in the future is something that
is merely anticipatory of a prospective benefit, something that is contingent on various factors. That is
why it is a mere expectancy, which does not give rise to a vested right.
 Furthermore, the measure undertaken by the President seeks to impose a moratorium only on increases
which are not authorized by existing legislation sanctioning salary adjustments.
 On the matter of the suspension of allowances and bonuses (which is already moot as it was expressly
made effective until December 31, 2010 only),47 its context shows that it was meant to arrest the
questionable practice by members of the board of directors/trustees of GOCCs and GFIs granting
numerous and excessive allowances, bonuses, incentives and other benefits to themselves. The
President’s action as Chief executive was simply a decisive response to Senate issued Resolution No.
17, s. 2010 urging him to act on the matter and an exercise of his control and oversight powers.
 There could have been no violation of substantive due process as petitioner, or anybody for that matter,
cannot properly claim a right to receive bonuses. A bonus is not a demandable and enforceable
obligation. By definition, a "bonus" is a gratuity or act of liberality of the giver which cannot be
demanded as a matter of right by the recipient.49 It is something given in addition to what is ordinarily
received by or strictly due to the recipient. The grant thereof is basically a management prerogative
which cannot be forced upon the employer who may not be obliged to assume the onerous burden of
granting bonuses or other benefits aside from the employee’s basic salaries or wages, especially so if it
is incapable of doing so.50 Thus, there can be no oppression to speak of even if these privileges
(bonuses, allowances and incentives) cease to be given. All the more reason should the President’s
judgment as Chief Executive be accorded respect if he directs the temporary stoppage of the grant of
bonuses when he deems it to be prejudicial to public interest or too onerous because of the
government’s fiscal condition.
 It is therefore clear that the suspension of the grant of bonuses and the imposition of a moratorium on
salary increases under EO 7 do not deprive petitioner of any property right. As such, any declaration
that such suspension or moratorium violates substantive due process cannot be justified.
 All told, the act of the President as Chief Executive in issuing EO 7 was not oppressive, arbitrary,
capricious or whimsical. No grave abuse of discretion may be imputed to the President. Thus, as the
President’s official act which enjoys the presumption of constitutionality and regularity, EO 7 should
be accorded due respect and its validity sustained.

A Final Word
 Accountability of public office is a safeguard of representative democracy. All who serve in
government must always be aware that they are exercising a public trust. They must bear in mind that
public funds are scarce resources and should therefore be used prudently and judiciously. Hence, where
there are findings that government funds are being wasted due to operational inefficiency and lack of
fiscal responsibility in the executive departments, bureaus, offices or agencies, the President as Chief
Executive should not be deprived of the authority to control, stop, check or at least manage the
situation. Absent any showing of grave abuse of discretion on his part, the Court should recognize in
the President as Chief Executive the power and duty to protect and promote public interest thru the
rationalization of the compensation and position classification system in executive departments,
bureaus, offices and agencies, including GOCCs and GFIs.