G.R. No. L-15582, L-16061, L-16685. July 31, 1961.
Felix Lectura, petitioner-appellee, vs. Regional Office No. 3 Under Department of Labor, et al., respondents-appellants. Benjamin Leung, petitioner-appellee, vs. F. A. Fuentes, et al., respondents-appellants. Regina, Incorporated and Jose De Leon Y Joven, petitioners, vs. Jose Arnado, et al., respondents.

FACTS

These consolidated cases challenge the jurisdiction of Regional Office No. 3 of the Department of Labor over money claims filed by workers. In G.R. No. L-15582, the Regional Office, through Hearing Officer Leonardo Gonzales, rendered a decision ordering Felix Lectura to pay his employees various wage-related claims. Lectura filed for certiorari and prohibition in the Court of First Instance of Manila, arguing the proceedings were void as they were based on the unconstitutional Reorganization Plan No. 20-A. The lower court ruled in Lectura’s favor. In G.R. No. L-16061, Benjamin Leung similarly contested the Regional Office’s decisions ordering him to pay differential pay and separation pay to former employees, with the Labor Standards Commission affirming the rulings. The Court of First Instance also annulled these proceedings. In G.R. No. L-16685, Regina, Inc. and Jose de Leon filed an original action for certiorari with the Supreme Court to nullify an order from the same Regional Office setting for hearing a complaint for overtime and terminal pay filed by former laborers, again contesting the Office’s jurisdiction under Reorganization Plan No. 20-A.

ISSUE

The common pivotal issue is whether Reorganization Plan No. 20-A, which granted regional offices of the Department of Labor original and exclusive jurisdiction over money claims of laborers, is constitutional and valid.

RULING

The Supreme Court declared Reorganization Plan No. 20-A null and void. The legal logic rests on the principle of separation of powers and the statutory limits of the Reorganization Commission’s authority. Republic Act No. 997 created the Government Survey and Reorganization Commission, empowering it to propose plans to promote better execution of laws, effective management, expeditious administration, and economy. However, this grant of executive reorganization authority did not include the power to confer judicial functions upon an executive department. The adjudication of money claims, which involves the determination of rights and liabilities between parties, is inherently judicial. By vesting the Department of Labor’s regional offices with original and exclusive jurisdiction over such claims, the Plan effectively bestowed judicial power upon an administrative body, which the Commission had no authority to do. Consequently, all proceedings conducted by Regional Office No. 3 under this void grant of jurisdiction were invalid. The decisions in G.R. Nos. L-15582 and L-16061 were affirmed, and the writs of certiorari and prohibition were granted in G.R. No. L-16685, with the preliminary injunction made permanent.