TOGUAY, Paul Jeffrey U.

2019-80129
Block 4
Topic: Administrative Agencies

Case Topic: the nullification of Executive Order No. 191 and Executive Order No. 223
Citation G.R. Nos. 142801-802

Date July 10, 2001

Petitioner BUKLOD NG KAWANING EIIB, CESAR POSADA, REMEDIOS G. PRINCESA,

BENJAMIN KHO, BENIGNO MANGA, LULU MENDOZA

Respondent HON. EXECUTIVE SECRETARY RONALDO B. ZAMORA, HON. SECRETARY JOSE

PARDO, DEPARTMENT OF FINANCE, HON. SECRETARY BENJAMIN DIOKNO,
DEPARTMENT OF BUDGET AND MANAGEMENT, HON. SECRETARY ARTEMIO
TUQUERO, DEPARTMENT OF JUSTICE

PRINCIPLES/ 1. There exists a distinction between the words "deactivate" and

DOCTRINES "abolish." To "deactivate" means to render inactive or ineffective or
to break up by discharging or reassigning personnel,13 while to
"abolish" means to do away with, to annul, abrogate or destroy
completely.14 In essence, abolition denotes an intention to do away
with the office wholly and permanently.15 Thus, while in abolition,
the office ceases to exist, the same is not true in deactivation where
the office continues to exist, albeit remaining dormant or
inoperative. Be that as it may, deactivation and abolition are both
reorganization measures.

2. The power to create includes the power to destroy.

3. A public office is either created by

a. the Constitution;
b. by statute; or
c. by authority of law.

4. The general rule has always been that the power to abolish a public
office is lodged with the legislature EXCEPT
a. as far as bureaus, agencies or offices in the executive
department are concerned, the President's power of control
 may justify him to inactivate the functions of a particular
office,19 or certain laws may grant him the broad authority
to carry out reorganization measures.
5. Reorganization "involves the reduction of personnel, consolidation
of offices, or abolition thereof by reason of economy or redundancy
of functions. (Canonizado v. Aguirre)

6. Reorganizations have been regarded as valid provided they are

pursued in good faith. Reorganization is carried out in 'good faith'
if it is for the purpose of economy or to make bureaucracy more
efficient.

7. A reorganization in good faith is one designed to trim the fat off

the bureaucracy and institute economy and greater efficiency in its
operation.

8. Reorganizations in this jurisdiction have been regarded as valid

provided they are pursued in good faith. As a general rule, a
reorganization is carried out in "good faith" if it is for the purpose
of economy or to make bureaucracy more efficient. In that event,
no dismissal (in case of dismissal) or separation actually occurs
because the position itself ceases to exist. And in that case, security
of tenure would not be a Chinese wall.

SANDOVAL-GUTIERREZ, J.:

FACTS:
In June 1987, President Corazon Aquino issued Executive Order No. 127,
establishing the Economic Intelligence and Investigation Bureau (EIIB) as part of the
structural organization of the Ministry of Finance. In March 1989, President Aquino
issued an Memorandum Order No. 225, making EIIB as the agency of primary
responsibility for anti-smuggling operations in all land areas and inland waters and
waterways outside the areas of sole jurisdiction of the Bureau of Customs."

In January 2000 (7 years after), President Joseph Estrada issued Executive Order
No. 191, deactivating EIIB, explaining that the designated functions of the EIIB are also
being performed by the other existing agencies of the government" and that "there is a
need to constantly monitor the overlapping of functions" among these agencies, and
transferring its functions to the Bureau of Customs and the National Bureau of
Investigation. Meanwhile, President Estrada issued Executive Order No. 196, creating the
Presidential Anti-Smuggling Task Force "Aduana." Two months after, President Estrada
issued Executive Order No. 223, providing that all EIIB personnel occupying positions
specified therein shall be deemed separated from the service effective April 30, 2000,
pursuant to a bona fide reorganization resulting to abolition, redundancy, merger,
division, or consolidation of positions.

ISSUE:
1. Whether or not The President has the authority to reorganize the executive
department. -YES

2. Whether or not the reorganization was done in bad faith because four days after
its deactivation, President Estrada created the Task Force Aduana (EO 196). - No

3. Whether petitioners' right to security of tenure is violated. - No

RULING:

1. Yes. The President has the authority to reorganize the executive department by authority
of laws under Section 48 of R.A. 7645, Sections 20 and 31, Book III of E.O. No. 292,
Presidential Decree No. 1772 which amended Presidential Decree No. 1416 and Section
77 of Republic Act 8745.

The general rule has always been that the power to abolish a public office is
lodged with the legislature EXCEPT as far as bureaus, agencies or offices in the
executive department are concerned, the President's power of control may justify him to
inactivate the functions of a particular office, or certain laws may grant him the broad
authority to carry out reorganization measures.

In the case at bar, the EIIB is a bureau attached to the Department of Finance. It
falls under the Office of the President. Hence, it is subject to the President's continuing
authority to reorganize.

2. No. There is no bad faith in the reorganization with EIIB

Reorganizations have been regarded as valid provided they are pursued in good
faith. Reorganization is carried out in 'good faith' if it is for the purpose of economy or to
make bureaucracy more efficient.
 Republic Act No. 665628 provides for the circumstances which may be
considered as evidence of bad faith in the removal of civil service employees made as a
result of reorganization, to wit:
(a) where there is a significant increase in the number of positions in the
new staffing pattern of the department or agency concerned;

(b) where an office is abolished and another performing substantially the

same functions is created;

(c) where incumbents are replaced by those less qualified in terms of

status of appointment, performance and merit;

(d) where there is a classification of offices in the department or agency

concerned and the reclassified offices perform substantially the same functions
as the original offices, and

(e) where the removal violates the order of separation.

In the case at bar, there is no employment of new personnel to man the

Task Force. E.O. No. 196 provides that the technical, administrative and special
staffs of EIIB are to be composed of people who are already in the public service,
they being employees of other existing agencies. Second, the thrust of E.O. No.
196 is to have a small group of military men under the direct control and
supervision of the President as the base of the government's anti-smuggling
campaign. The EIIB had proven itself burdensome for the government because it
maintained separate offices in every region in the Philippines. Third, it is evident
from the yearly budget appropriation of the government that the creation of the
Task Force Aduana was especially intended to lessen EIIB's expenses.The
previous GAA budget amounts were far above the P50,000,000 allocation to the
Task Force Aduana for the year 2000. The Task Force Aduana, being composed
of elements from the Presidential Security Group (PSG) and Intelligence Service
Armed Forces of the Philippines (ISAFP),36 has the essential power to effect
searches, seizures and arrests. The EIIB did not have this power.

3. No. Petitioners' right to security of tenure is not violated.

the abolition of an office within the competence of a legitimate body if done in good faith
suffers from no infirmity. Valid abolition of offices is neither removal nor separation of the
incumbents.

There is no such thing as an absolute right to hold office. Except constitutional offices
which provide for special immunity as regards salary and tenure, no one can be said to have
any vested right in an office or its salary.
Basis of the President to reorganize:
1. Section 48 of R.A. 7645 (Scaling Down and Phase Out of Activities of Agencies Within
the Executive Branch)

2. Section 20, Book III of E.O. No. 292 (Residual Power )

(Sec. 20. Residual Powers. – Unless Congress provides otherwise, the President shall exercise such other powers and
functions vested in the President which are provided for under the laws and which are not specifically enumerated above
or which are not delegated by the President in accordance with law.' )

3. Section 31, Book III of Executive Order No. 292 otherwise known as the Administrative
Code of 1987
(the President, subject to the policy in the Executive Office and in order to achieve simplicity, economy and efficiency,
shall have the continuing authority to reorganize the administrative structure of the Office of the President."

4. Presidential Decree No. 1772 which amended Presidential Decree No. 1416
(These decrees expressly grant the President of the Philippines the continuing authority to reorganize the national
government, which includes the power to group, consolidate bureaus and agencies, to abolish offices, to transfer
functions, to create and classify functions, services and activities and to standardize salaries and materials.)

5. Section 77 of Republic Act 8745

Sec. 77. Organized Changes. Unless otherwise provided by law or directed by the President of the Philippines, no
changes in key positions or organizational units in any department or agency shall be authorized in their respective
organizational structures and funded from appropriations provided by this Act."

Republic Act No. 665628 provides for the circumstances which may be considered as
evidence of bad faith in the removal of civil service employees made as a result of
reorganization, to wit:
(a) where there is a significant increase in the number of positions in the new
staffing pattern of the department or agency concerned;

(b) where an office is abolished and another performing substantially the same
functions is created;

(c) where incumbents are replaced by those less qualified in terms of status of
appointment, performance and merit;

(d) where there is a classification of offices in the department or agency

concerned and the reclassified offices perform substantially the same functions as the
original offices, and

(e) where the removal violates the order of separation.

Xxx nothing follows xxx