VI.

QUASI-JUDICIAL POWER

Also known as administrative adjudication, quasi- judicial power is "the power to hear and
determine questions of fact to which the legislative policy is to apply and to decide in
accordance with the standards laid down by the law itself in enforcing and administering the
same law."

The ever increasing variety of powers and functions given to administrative agencies recognizes
the need for the active intervention of administrative agencies in matters calling for technical
knowledge and speed in countless controversies which cannot possibly be handled by regular
courts. A "quasi-judicial function" is a term which applies to the action, discretion, etc. of public
administrative. officers or bodies, who are 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."

Distinguished from Judicial Power

Where the function of an officer or body is primarily administrative and the power to hear and
determine controversies is granted as an incident to the administrative duty, the power is
administrative or quasi-judicial, or at least it is properly exercisable by administrative authorities;
but where the duty is primarily to decide questions of legal rights between private parties, such
decision being the primary object and not merely incidental to regulation or some other
administrative function, the function is judicial.

There is no thought of disregarding the traditional line separating judicial and administrative
competence, the former being entrusted with the determination of legal questions and the latter
being limited as a result of its expertise to the ascertainment of the decisive facts.

Grant, and Limitations of Quasi-Judicial Powers

The legislature may confer on administrative boards or bodies quasi-judicial powers involving
the exercise of judgment and discretion as incident to the performance of administrative
functions. But in so doing, the legislature must state its intention in express terms, that would
leave no doubt, as even such quasi-judicial prerogatives must be limited, if they are to be valid,
only to those incidental to or in connection with the performance of administrative duties, which
do not amount to conferment of jurisdiction over a matter exclusively vested in the courts.5

Classification of Adjudicating Powers

Adjudicatory or quasi-judicial powers are classified generally into two classes: (1) Enabling
Powers; and (2) Directing Powers.

Enabling powers refer to those powers granted to administrative bodies to permit or allow
something which the law undertakes to regulate to be done by their approval. The chief
application of this power is, of course, in the granting or denial of licenses to engage in a
particular business or occupation: it is also exemplified by the powers of the LTFRB to issue
certificates of public convenience or necessity, the powers of the Securities & Exchange
Commission to permit the issuance of securities, the power of the Energy Regulatory
Commission to issue authorities in the price of electricity; The power of the IPOPHL to issue
patents and copyrights, and register trade-marks and trade-names, and the power of the
Bangko Sentral ng Pilipinas to license banks.

Directing powers are illustrated by the corrective powers of public utility commissions, powers of
assessment under the revenue and assessment laws, reparations under public utility laws,
awards under the workmen's compensation laws, powers of abstract determination - such as
definition, valuation, classification and fact finding dispensing, examining and summary powers.
and

Directing powers are further classified into: (a) Dispensing, (b) Examining, and (c) Summary
Powers."

Dispensing powers refer to the authority to exempt from or relax a general prohibition, or
authority to relieve from an affirmative duty. An instance of the former is the authority of zoning
boards to vary the provisions of a zoning statute or ordinance. Of the latter type is the authority
of the Public Service Commission to permit the abandonment of service by carriers. 8

Examining powers are likewise known as the investigatory or inquisitorial powers which include
the power to inspect or to secure or to require the disclosure of information by means of
accounts, records, or otherwise. Included in these investigatory or inquisitorial powers are the
powers (1) of subpoena; (2) swearing of witnesses; (3) of interrogating witnesses; (4) calling for
production of books, papers, and records; (5) requiring that books, papers, and records be
made available for inspection; (6) of inspecting premises; (7) of requiring written answers to
questionnaires; (8) requiring reports, periodic or special; and (9) of requiring the filing of
statements."

Summary powers refer to the authority of administrative agencies to apply compulsion or force
against person or property to effectuate a legal purpose without a judicial warrant to authorize
such action. These powers are exemplified by the authority of administrative agencies in the
fields of health, banking, agriculture, animals, aliens, game laws, building regulations, licenses,
nuisances, schools, taxation, and other fields. In the absence of a statutory grant of power,
administrative authorities may not themselves enforce their determinations, at least not by direct
and positive action, 10 Thus, under the National Internal Revenue Code, the Collector may
resort to the summary proceedings of distraint and levy for the collection of internal revenue
taxes.

Nature of Proceedings
Such administrative proceedings, have been held to partake of the nature of a judicial
proceeding. A proceeding requiring the taking and weighing of evidence, the determination of
facts based upon the consideration of evidence, and the making of an order supported by
findings has a quality resembling that of a judicial proceeding. Hence, it is frequently described
as a proceeding of a quasi-judicial character, Examples of these quasi-judicial proceedings will
be those made before the National Labor Relations Commission, Securities & Exchange
Commission, Energy Regulatory Board, National Telecommunications Commission, the
professional or examining boards under the Professional Regulation Commission, the Human
Settlements Adjudication Commission, and similar others.

Source
The power is incidental to the power of regulation vested in the administrative body, though
often expressly conferred by the legislature through specific provisions in the charter of the
agency.

Jurisdiction

Jurisdiction is essential to give validity to the determinations of administrative authorities.

Without jurisdiction, their acts are void and open to collateral attack. Administrative authorities
are tribunals of limited jurisdiction. Their jurisdiction is dependent entirely upon the provisions of
the statutes reposing power in them: they may determine whether they have it. If the provisions
of the statutes are not met and complied with, they have no jurisdiction. Administrative
determinations not within the jurisdiction of administrative agencies are void and open to
collateral attack.

The jurisdiction and powers of administrative agencies, are limited to those expressly granted or
necessarily implied from those granted in the legislation creating such body; and any order
without or beyond such jurisdiction is void and ineffective, 13

Administrative agencies are tribunals of limited jurisdiction. Their jurisdiction may proceed from
the Constitution or statutes. Where the jurisdiction of an Vadministrative tribunal is established
by the constitution, a statute attempting to enlarge such jurisdiction is unconstitutional, and a
constitutional amendment relating to its jurisdiction cannot have a retroactive effect so as to
embrace a case arising and decided prior to the amendment. When derived from statutes, their
jurisdiction is dependent entirely upon the validity and the terms of the statutes reposing power
in them, and they cannot confer jurisdiction on themselves. If the provisions of the statutes, at
least the basic mandatory provisions and the condition precedents, are not met and complied
with, they have no jurisdiction. 14

An administrative agency cannot enlarge its own jurisdiction nor can jurisdiction be conferred
upon the agency by parties before it. Accordingly, deviations from an agency's statutorily
established sphere of action cannot be upheld because based upon agreement, contract, or
consent of the parties, nor can they be made effective by waiver or estoppel. 15 This stems from
the rationale that jurisdiction is conferred and defined by law, and eannot be made subject of
any agreement or stipulation.
Procedural Due Process: Notice and Hearing

The essence of procedural due process is embodied in the basic requirement of notice and a
real opportunity to be heard. Procedural due process simply means the opportunity to explain
one's side or the opportunity to seek a reconsideration of the action or ruling complained of. "To
be heard" does not mean only verbal arguments in court; one may be heard also thru pleadings.
Where opportunity to be heard, either through oral arguments or pleadings, is accorded, there is
no denial of procedural due process, 16

The requisites of procedural due process are (1) that he shall have had due notice, which may
be actual or constructive, of the institution of the proceedings by which his legal rights may be
affected; (2) that he shall be given a reasonable opportunity to appear and defend his rights,
including the right himself to testify, to produce witnesses, and to introduce relevant documents
and other evidence; (3) that the tribunal in or before which his rights are adjudicated is so
constituted as to give reasonable assurance of his honesty and impartiality; and (4) that it is a
court of competent jurisdiction.

However, not every administrative determinations affecting private individuals requires notice
and hearing. Notice and hearing is necessary in order to comply with due process of law only
when some constitutional right is claimed to be invaded. Where the purpose of an administrative
determination is to decide whether a right or privilege which an applicant does not possess shall
be granted to him or withheld in the exercise of a discretion vested by statute, or where the
power exercised is essentially administrative or executive and not judicial or quasi-judicial,
notice and hearing is not necessary in the absence of an express or implied statutory provision
therefor, and a statute may provide for such determination without requiring notice and hearing.
Even though the power exercised is quasi-judicial, notice or hearing may not be essential to due
process of law if no personal or property rights are involved. Also there are many cases in which
powers of determination and action of a quasi- judicial character are given to officers entrusted
with duties of local or municipal administration by which not only the property, but the lives, of
individuals, may be affected, and which, from their nature, must be exercised without a prior
hearing or finally and conclusively without any hearing, or even notice to the parties who may be
affected. 18

Thus, the notice and hearing requirement is dispensed with in the following instances:
(1) In proceedings where there is an urgent need for immediate action, like the summary
abatement of a nuisance per se, 20 the preventive suspension of a public servant facing
administrative charges, the padlocking of filthy restaurants or theaters showing obscene movies
or like establishments which are immediate threats to public health and decency, 22 and the
cancellation of a passport of a person sought for criminal prosecution;

Where there is tentativeness of administrative action, that is, where the respondent is not
precluded from enjoying the right to notice and hearing at a later time without prejudice to the
person affected, such as the summary distraint and levy of the property of a delinquent
taxpayer, 24 and the replacement of a temporary appointee: 25 and
(3) Where the twin rights have previously been offered but the right to exercise them had not
been claimed 26

Administrative Due Process

To preserve personal and property rights against the arbitrary action of public officials, the
constitutional guaranty of due process of law must be observed, Dueprocess must be observed
and preserved to all persons whose legal rights may be involved and concluded by the
determination of the board in proceedings quasi-judicial in nature. 27

In administrative proceedings, due process is satisfied when a person is notified of the charge
against him and given an opportunity to explain or defend oneself. In such proceedings, the
filing of charges and giving reasonable opportunity for the person so charged to answer the
accusations against him constitute the minimum requirements of due process. The essence of
due process, therefore, as applied to administrative proceedings, is an opportunity to explain
one's side, or an opportunity to seek a reconsideration of the action or ruling complained of.
Thus, a violation of that right occurs when a court or tribunal rules against a party without giving
the person the opportunity to be heard. 28

The requisite elements for administrative due process were initially laid down in Ang Tibay v.
Court of Industrial Relations, 29 thus:

(1) The right to a hearing, which includes the right of the party interested or affected to present
his own case and submit evidence in support thereof;

(2) Not only must the party be given an opportunity to present his case and to adduce evidence
tending to establish the rights which he asserts but the tribunal must consider the evidence
presented;

(3) While the duty to deliberate does not impose the obligation to decide right, it does imply a
necessity which cannot be disregarded, namely, that of having something to support it is a
nullity, a place when directly attached;

(4) Not only must there be some evidence to support a finding or conclusion, but the evidence
must be substantial;

(5) The decision must be rendered on the evidence presented at the hearing, or at least
contained in the record and disclosed to the parties affected;

(6) The court or tribunal must act on its or his own independent consideration of the law and
facts of the controversy, and not simply accept the views of a subordinate in arriving at a
decision; and
(7) The court or tribunal should, in all controversial questions, render its decision in such a
manner that the parties to the proceeding can know the various issues involved, and the
reasons for the decision rendered. The performance of this duty is inseparable from the
authority conferred upon it.

Necessity of an Actual Hearing

Administrative due process does not necessarily connote full adversarial proceedings. The
requirement of notice and hearing does not connote full adversarial proceedings as elucidated
in numerous cases decided by this Court. Actual adversarial proceedings become necessary
only for clarification or when there is a need to propound searching questions to witnesses who
give vague testimonies. This is a procedural right which must be asked for since it is not an
inherent right, and summary proceedings may be conducted thereon. Such formal hearing as a
not mere superfluity, as it is a procedural right that may be invoked by the party. It is true that a
formal hearing is not obligatory in administrative proceedings because the due process
requirement is satisfied if the parties are given the opportunity to explain their respective sides
through position papers or pleadings. Nonetheless, the idea that a formal hearing is not
indispensable should not be hastily thrown around by administrative bodies.

A closer perusal of past jurisprudence shows that the Supreme Court did not intend to trivialize
the conduct of a formal hearing but merely afforded latitude to administrative bodies especially
in cases where a party fails to invoke the right to hearing or is given the opportunity but opts not
to avail of it. In the Ang Tibay case, the Court explained that administrative bodies are free from
a strict application of technical rules of procedure and are given sufficient leeway. In the said
case, however, nothing was said that the freedom included the setting aside of a hearing but
merely to allow matters which would ordinarily be incompetent or inadmissible in the usual
judicial proceedings. In fact, the seminal words of Ang Tibay manifest a desire for administrative
bodies to exhaust all possible means to ensure that the decision rendered be based on the
accurate appreciation of facts. The Court reminded that administrative bodies have the active
duty to use the authorized legal methods of securing evidence and informing itself of facts
material and relevant to the controversy. As such, it would be more in keeping with
admimstrative due process that the conduct of a hearing be the general rule rather than the
exception.

Opportunity to be heard

Due process, as a constitutional precept, does not always and in all situations require a
trial-type proceeding. Due process is satisfied when a person is notified of the charge against
him and given an opportunity to explain or defend himself. In administrative proceedings, the
filing of charges and giving reasonable opportunity for the person so charged to answer the
accusations against him constitute the minimum requirements of due process. The essence of
due process is simply to be heard, or as applied to administrative proceedings, an opportunity to
explain one's side, or an opportunity to seek a reconsideration of the action or ruling complained
of.
The opportunity to be heard is an intrinsic part of the constitutional right to due process.
Administrative proceedings require that the respondent be informed of the charges and be given
an opportunity to refute them. Even after judgment is rendered, due process requires that the
respondent not only be informed of the judgment but also be given the opportunity to seek
reconsideration of that judgment. This is the true definition of the opportunity to be heard. 38

Rules of Procedure

Administrative bodies are not bound by the technical niceties of law and procedure and the rules
obtaining in courts of law. Administrative tribunals exercising quasi- judicial powers are
unfettered by the rigidity of certain procedural requirements, subject to the observance of
fundamental and essential requirements of due process in justiciable cases presented before
them. In administrative proceedings, technical rules of procedure and evidence are not strictly
applied and administrative due process cannot be fully equated with due process in its strict
judicial sense.

While it is true that administrative or quasi-judicial bodies like the NLRC are not bound by the
technical rules of procedure in the adjudication of cases, this procedural rule should not be
construed as a license to disregard certain fundamental evidentiary rules. The evidence
presented must at least have a modicum of admissibility for it to have probative value. Not only
must there be some evidence to support a finding or conclusion, but the evidence must be
substantial, 35

Substantial Evidence

Substantial evidence is "such relevant evidence as a reasonable mind accept as adequate to

support a conclusion". To this end, the rules of evidence prevailing in courts of law and equity
shall not be controlling. The obvious purpose of this and similar provisions is to free
administrative boards from the compulsion of technical rules so that the mere admission of
matter which would be deemed incompetent in judicial proceedings would not invalidate the
administrative order.

But this assurance of a desirable flexibility in administrative procedure does not go far as to
justify orders without a basis in evidence having rational probative force. Mere uncorroborated
hearsay or rumor does not constitute substantial evidence. 37 Within the field of administrative
law, while strict rules of evidence are not applicable to quasi-judicial proceedings, nevertheless,
in adducing evidence constitutive of substantial evidence, the basic rule that mere allegation is
not evidence cannot be disregarded.

The standard of substantial evidence is satisfied when there is reasonable ground to believe
that respondent is responsible for the misconduct complained of, even if such evidence might
not be overwhelming or even preponderant. While substantial evidence does not necessarily
import preponderance of evidence as is required in an ordinary civil case, or evidence beyond
reasonable doubt as is required in criminal cases, it should be enough for a reasonable mind to
support a conclusion. 39

Decision based on the facts and law

In administrative law, a quasi-judicial proceeding involves (a) taking and evaluating evidence;
(b) determining facts based upon the evidence presented; and (c) rendering an order or
decision supported by the facts proved. The exercise of quasi-judicial functions involves a
determination, with respect to the matter in controversy, of what the law is; what the legal rights
and obligations of the contending parties are; and based thereon and the facts obtaining. the
adjudication of the respective rights and obligations of the parties.

A decision that does not clearly and distinctly state the facts and the law on which it is based
leaves the parties in the dark as to how it was reached and is precisely prejudicial to the losing
party, who is unable to pinpoint the possible errors of the court for review by a higher tribunal. 41

Independent consideration

It must be emphasized that the appointment of competent officers to hear and receive evidence
is commonly resorted to by administrative bodies or agencies in the interest of an orderly and
efficient disposition of administrative cases. 42 The rule that requires an administrative officer to
exercise his own judgment and discretion does not preclude him from utilizing, as a matter of
practical administrative procedure, the aid of subordinates to investigate and report to him the
facts, on the basis of which the officer makes his decisions. It is sufficient that the judgment and
discretion finally exercised are those of the officer authorized by law. Neither does due process
of law nor the requirements of fair hearing require that the actual taking of testimony be before
the same officer who will make the decision in the case. As long as a party is not deprived of his
right to present his own case and submit evidence in support thereof, and the decision is
supported by the evidence in the record, there is no question that the requirements of due
process and fair trial are fully met. In short, there is no abnegation of responsibility on the part of
the officer concerned as the actual decision remains with and is made by said officer. It is,
however, required that to give the substance of a hearing, which is for the purpose of making
determinations upon evidence the officer who makes the determinations must consider and
appraise the evidence which justifies them. Thus, while the hearing officer may make
preliminary rulings on the myriad of questions raised at the hearings of these cases, the ultimate
decision on the merits of all the issues and questions involved is left to the administrative
agency, 43

An administrative agency may employ other persons, such as a hearing officer, examiner or
investigator, to receive evidence, conduct hearing and make reports on the basis of which the
agency shall render its decision. Such a procedure is a practical necessity. Thus, it is logical to
say that this mandate was rendered precisely to ensure that in cases where the hearing or
reception of evidence is assigned to a subordinate, the body or agency shall not merely rely on
his recommendation but instead shall personally weigh and assess the evidence which the said
subordinate has gathered. 44

In order that the review of the decision of a subordinate officer might not turn out to be a farce
the reviewing officer must perforce be other than the officer whose decision is under review;
otherwise, there could be no different view or there would be no real review of the case. The
decision of the reviewing officer would be a biased view; inevitably, it would be the same view
since being human, he would not admit that he was mistaken in his first view of the case.

The actual exercise of the disciplining authority's prerogative requires a prior independent
consideration of the law and the facts. Failure to comply with this requirement results in an
invalid decision. The disciplining authority should not merely and solely rely on an investigator's
recommendation, but must personally weigh and assess the evidence gathered. There can be
no shortcuts, because at stake are the honor, the reputation, and the livelihood of the person
administratively charged. 46

Res judicata and stare decisis

It is an established doctrine in this jurisdiction that the decisions and orders of administrative
agencies have upon their finality, the force and binding effect of a final judgment within the
purview of the doctrine of res judicata. These decisions and orders are as conclusive upon the
rights of the affected parties as though the same had been rendered by a court of general
jurisdiction. The rule of res judicata thus forbids the reopening of a matter once determined by
competent authority acting within their exclusive jurisdiction. 47

The rule which forbids the reopening of a matter once judicially determined by competent
authority applies as well to the judicial and quasi-judicial acts of public, executive, or
administrative officers and boards acting within their jurisdiction as to the judgments of courts
having general judicial powers. However, a particular decision or determination may not be
conclusive, as where it was not a judicial, as distinguished from a legislative, executive, or
ministerial, determination, or the matter was not within the jurisdiction of the officer or board. 48
The doctrine of res judicata applies only to judicial or quasi-judicial proceedings and not to the
exercise of administrative powers. 49

There are, however, cases in which the doctrine of res judicata has been held applicable to
judicial acts of public, executive, or administrative officers and boards. In this connection, it has
been declared that whenever a final adjudication of persons invested with power to decide on
the property and rights of the citizen is examinable by the Supreme Court, upon a writ of error or
a certiorari, such final adjudication may be pleaded as res judicata.

By way of generalization and only as a broad principle, subject to exceptions, when an

administrative determination has been issued with respect to a matter wherein an administrative
agency has continuing jurisdiction, and no rights have vested in the meantime by reason
thereof, and so long as it has not yet passed beyond the control of the administrative authorities,
as where the determination is not yet final but interlocutory, or where, the powers and
jurisdiction of the administrative authorities are continuing in character, the principle of res
judicata does not apply. Administrative agencies have the power to modify their determinations
on the ground of fraud or imposition, mistake, inadvertence, or newly discovered evidence, or to
meet the changed conditions, whether by reason of express statutory provision granting the
power of revision or by reason of principles applied by the others. 51

However, when a decision or determination was issued or made in the exercise of essentially
judicial functions involving the grant of some right or privilege intended as a final determination
of the question itself or rights have already vested in the meantime by reason thereof, or when
such administrative determination has been the subject of judicial affirmance, the doctrine of res
judicata can be applied although the court usually apply it not by itself but as a specie of
equitable estoppel which produces approximately the same result as would application of the
rules of res judicata. 02

Relative to this is the application of the doctrine of stare decisis, that for the sake of certainty, a
conclusion reached in one case should be applied to those which follow, if the facts are
substantially the same, even though the parties may be different. This was allowed insofar as to
avoid any conflicting decision on the same facts and the legal and constitutional questions in
whatever decision of the administrative tribunal might render with that of any higher tribunal. 53

Prejudicial question

A prejudicial question is that which arises in a case, the resolution of which is a logical
antecedent of the issue involved therein and the cognizance of which pertains to another
tribunal. The prejudicial question must be determinative of the case before the court but the
jurisdiction to try and resolve it must be lodged in another court or tribunal.

The court in which an action is pending may, in the exercise of a sound discretion, upon proper
application for a stay of that action, hold the action in abeyance to abide the outcome of another
pending in another court, especially where the parties and the issues are the same, for there is
power inherent in every court to control the disposition of causes on its dockets with economy of
time and effort for itself, for counsel, and for litigants. Where the rights of parties to the second
action cannot be properly determined until the questions raised in the first action are settled the
second action should be stayed.