G.R. No. 193978 ; February 28, 2012
JELBERT B. GALICTO, Petitioner, vs. H.E. PRESIDENT BENIGNO SIMEON C. AQUINO III, ATTY. PAQUITO N. OCHOA, JR., and FLORENCIO B. ABAD, Respondents.

FACTS

Petitioner Jelbert B. Galicto, an employee of the Philippine Health Insurance Corporation (PhilHealth), filed a Petition for Certiorari and Prohibition to nullify and enjoin the implementation of Executive Order No. 7 (EO 7) issued by President Benigno Simeon C. Aquino III on September 8, 2010. EO 7, entitled “Directing the Rationalization of the Compensation and Position Classification System in the Government-Owned and Controlled Corporations (GOCCs) and Government Financial Institutions (GFIs),” was issued following Senate findings and a resolution urging action on excessive allowances and benefits in GOCCs/GFIs. The order established a framework for a compensation system, created a Task Force to review remunerations, imposed a moratorium on salary increases and new benefits for employees, and suspended allowances, bonuses, and incentives for members of Boards of Directors/Trustees until December 31, 2010. The petitioner argued EO 7 was unconstitutional, issued with grave abuse of discretion, lacked legal basis, divested GOCC boards of their legislatively granted power to fix compensation, constituted an invalid exercise of legislative power, and was arbitrary. Respondents sought dismissal on procedural grounds, including lack of locus standi, improper remedy, and presidential immunity from suit, and defended EO 7’s validity based on the President’s control over GOCCs/GFIs and authority under Joint Resolution No. 4. Subsequently, Congress enacted Republic Act No. 10149 (the GOCC Governance Act of 2011) on June 6, 2011, which expressly authorizes the President to fix the compensation framework of GOCCs and GFIs.

ISSUE

Whether the petition for certiorari and prohibition is the proper remedy to challenge the constitutionality and validity of Executive Order No. 7.

RULING

The Supreme Court DISMISSED the petition due to patent formal and procedural infirmities and for having been mooted by subsequent events. The Court held that a petition for certiorari and prohibition under Rule 65 is not the proper remedy to assail the validity of an executive order. Certiorari applies only to judicial, quasi-judicial, or mandatory acts, not to the issuance of an executive order, which is an executive act. The proper recourse is a petition for declaratory relief under Rule 63 of the Rules of Court, filed with the Regional Trial Court, to determine questions of construction or validity of statutes, executive orders, or regulations. Citing Liga ng mga Barangay National v. City Mayor of Manila, the Court emphasized that respondents did not act in a judicial or quasi-judicial capacity. Furthermore, the enactment of Republic Act No. 10149 , which expressly grants the President authority to fix GOCC/GFI compensation, rendered the petition moot, as it provided the legal basis that the petitioner claimed EO 7 lacked. The Court did not reach the substantive constitutional issues due to the dismissal on procedural grounds.