G.R. No. 209216 , February 21, 2023
EXECUTIVE SECRETARY LEANDRO MENDOZA, DEPARTMENT OF ENERGY-DEPARTMENT OF JUSTICE JOINT TASK FORCE, AND DEPARTMENT OF ENERGY SECRETARY ANGELO T. REYES, PETITIONERS, VS. PILIPINAS SHELL PETROLEUM CORPORATION, RESPONDENT.

FACTS

This case originated from an action for declaratory relief filed by respondent Pilipinas Shell Petroleum Corporation (Pilipinas Shell) before the Regional Trial Court (RTC) of Makati, challenging the constitutionality of Section 14(e) of Republic Act No. 8479 (the Downstream Oil Industry Deregulation Act of 1998). The challenged provision states: “In times of national emergency, when the public interest so requires, the DOE may, during the emergency under reasonable terms prescribed by it, temporarily take over or direct the operation of any person or entity in the Industry.” Pilipinas Shell argued the provision was oppressive, unreasonable, and an invalid delegation of emergency powers to the Executive Department. The RTC declared Section 14(e) void and unconstitutional. The Court of Appeals affirmed the RTC’s decision. Petitioners, the Executive Secretary and others, filed the present petition before the Supreme Court, arguing the provision is a proper delegation of the power to exercise emergency powers to the President, through the Department of Energy (DOE).

ISSUE

The primary issue is whether Section 14(e) of R.A. No. 8479 is constitutional, particularly regarding the delegation of temporary emergency takeover power to the Department of Energy (DOE) and not directly to the President.

RULING

The Supreme Court, through the ponencia (Decision of Justice Leonen) which this Separate Concurring Opinion by Justice Caguioa agrees with, reversed and set aside the Decision of the Court of Appeals and declared Section 14(e) of R.A. No. 8479 constitutional. The concurring opinion clarifies and emphasizes the following points:
1. On Justiciability: The action for declaratory relief filed by Pilipinas Shell presented a justiciable controversy. An actual case or controversy exists even in the absence of “actual facts” or an overt breach of the law by the party challenging it. A “mere contrariety of legal rights” is sufficient. The requirement of justiciability is satisfied when there is an actual controversy or ripening seeds thereof, and the declaration sought will help end it. The absence of an overt act does not equate to a lack of an actual case, especially in a declaratory relief action, which presupposes no actual breach has yet occurred.
2. On the Constitutionality of Section 14(e): The provision is a valid delegation of emergency powers. The concurring opinion rejects Pilipinas Shell’s claim that the Constitution requires Congress to delegate the temporary emergency takeover power directly and solely to the President. While Article VI, Section 23(2) authorizes Congress to delegate emergency powers to the President, and Article XII, Section 17 refers to the State’s power to temporarily take over businesses, these provisions do not prohibit Congress from delegating such powers to an executive department or agency. The President, under the Constitution’s control doctrine (Article VII, Section 17), has control over all executive departments, including the DOE. Therefore, a delegation to the DOE is, in legal contemplation, a delegation to the President, as the department acts under the President’s supervision and control. The law ( R.A. No. 8479 ) merely designates the DOE as the implementor, with the President retaining ultimate authority. This aligns with established jurisprudence where Congress has validly delegated powers to administrative bodies under the control of the President.