012 Lacson-Magallanes Co., Inc. v.

Pano (OLAZO) [DEEMED READ]

17 November 1967 | Sanchez, J. | Power of Control "disapproved or reprobated by the Chief Executive,” that remains the act
of the Chief Executive, and cannot be successfully assailed. In this case,
there is nothing which shows that the President disapproved of the
PETITIONER: Lacson-Magallanes Co., Inc. Executive Secretary’s actions.
RESPONDENTS: Jose Pano, Hon. Juan Pajo, in his capacity as
Executive Secretary and Hon. Juan De G. Rodriguez, in his capacity as DOCTRINE: Control - the power of an officer to alter or modify or
Secretary of Agriculture and Natural Resources (“n” in Pano is actually, nullify or set aside what a subordinate officer had done in the performance
/enye/. Sorry, idk how to type it) of his duties and to substitute the judgment of the former for that of the
latter.
SUMMARY: Magallanes owned pasture land in Davao. He ceded his
rights to a portion of the land to LMCI. When the land was declared as FACTS:
agricultural land, Pano and 19 others filed sales applications for the 1. Jose Magallanes was a permittee and actual occupant of a 1,103
portions which they were occupying. LMCI also filed sales application hectare pasture land in Tamalgon, Municipality of Bansalan,
over the entire portion ceded to it. Pano filed a protest. Director of Lands Province of Davao.
ruled in favor of LMCI. Pano appealed to SANR who dismissed the case.
When the case was elevated to OP, Executive Secretary Pajo awarded the 2. Magallanes ceded his rights and interest to a portion (392.7569) of
portion which Pano and the others were occupying to them and ordered a the land to Lacson Magallanes Co., Inc. (LMCI). A year after, the
subdivision of the lots and their allocation to actual occupants, subject to portion ceded to LMCI was declared as agricultural land.
LMCI’s right to reimbursement. LMCI brought the case before the CFI
who dismissed the case. 3. Another year later, Jose Pano and 19 others applied for purchase of
90 hectares of the released area. 2 Months later LMCI also filed its
ISSUES: WoN decisions of the Director of Lands as approved by the own sales application over the entire released area. Pano and the
SANR are binding on the President? NO. The Constitution provides for others protested claiming that they are the actual occupants of the
the duty of the President to execute laws, as well as his control of all area covered by their sales application.
executive departments. He controls and direct their acts. Implicit is his
authority to go over, confirm, modify or reverse the action taken by his 4. Director of Lands gave due course to the application of LMCI and
department secretaries. The standard practice when it comes to decisions dismissed the application of Pano and the others. Pano appealed to
of the Director of Lands which are affirmed by the SANR is to allow the Secretary of Agriculture and Natural Resources (SANR), but the
appeals to the Office of the President. In some cases, failure to appeal to SANR dismissed the appeal as without merit.
the Office of the President may even be considered as a fatal defect, 5. Thus, the case was elevated to the President of the Philippines.
leading to dismissal of the case for non-exhaustion of all administrative Executive Secretary Juan Pajo modified the decision of the DIR as
remedies. This right to appeal to the President reposes upon the affirmed by the SANR and held that:
President’s power of control over the executive deparments.
a. "it would be for the public interest that appellants, who are
[MAIN] WoN the decision of the Executive Secretary is an undue mostly landless farmers who depend on the land for their
delegation of power? NO. Under our constitutional setup, the Executive
existence, be allocated that portion on which they have made
Secretary who acts for and in behalf and by authority of the President has
an undisputed jurisdiction to affirm, modify, or even reverse any order that improvements;" and
the SANR, including the Director of Lands, may issue. When the
Executive secretary acts “by authority of the President,” his decision is b. directed that the controverted land "should be subdivided
that of the President’s. accepted. Only the President may rightfully say that into lots of convenient sizes and allocated to actual
the Executive Secretary is not authorized to do so. Unless the action taken occupants, without prejudice to the corporation's right to
is reimbursement for the cost of surveying this portion."
6. LMCI took the decision to the CFI, who dismissed the case. Thus, this appeal.
 7. Arguments of LMCI: 3. This right to appeal to the President reposes upon the President’s
power of control over the executive deparments. Control simply
a. Section 4 of C.A. 141 provides that decisions of the
mean the power of an officer to alter or modify or nullify or set
Director of Lands as to questions of facts shall be
aside what a subordinate officer had done in the performance of
conclusive when approved by the SANR. LMCI believes
his duties and to substitute the judgment of the former for that of
that this binds not only the courts but also the President.
the latter.
b. The Constitution does not expressly allow the President to
4. This negates the assertion that the President cannot undo an act
delegate the power of control to the Executive Secretary.
of his department secretary.
The President should have acted personally on the matter.
No undue delegation of power to the Executive Secretary
ISSUE/s:
5. The president is not expected to perform in person all the
1. WoN decisions of the Director of Lands as approved by the SANR
multifarious executive and administrative functions. The
are binding on the President – NO. The President has the power of
Executive Secretary is an auxiliary unit which assists the
conrol over the executive departments.
President.
2. [MAIN] WoN the decision of the Executive Secretary is an
6. Under our constitutional setup, the Executive Secretary who acts
undue delegation of power. – NO. The action of the Executive for and in behalf and by authority of the President has an
Secretary “by authority of the President” is deemed to be the
undisputed jurisdiction to affirm, modify, or even reverse any
acts of the President himself. order that the SANR, including the Director of Lands, may
RULING: For the reasons given, the judgment under review is hereby issue.
affirmed. Costs against plaintiff. So ordered.
7. LMCI alleges that the Executive Secretary is equal in rank to the
RATIO: other department heads. It is argued that one department head,
The President is not bound by the decision of the Director of Lands as on the pretext that he is an alter ego of the President, cannot
affirmed by the SANR intrude into the zone of action allocated to another department
1. The Constitution provides for the duty of the President to execute secretary. LMCI is wrong.
laws, as well as his control of all executive departments. The
8. When the Executive secretary acts “by authority of the
department heads are men of his confidence. He has the power to
President,” his decision is that of the President’s. accepted. Only
appoint them and the privilege to dismiss them at pleasure. He
the President may rightfully say that the Executive Secretary is
controls and direct their acts. Implicit is his authority to go over,
not authorized to do so. Unless the action taken is "disapproved
confirm, modify or reverse the action taken by his department
or reprobated by the Chief Executive,” that remains the act of
secretaries.
the Chief Executive, and cannot be successfully assailed. In this
2. The standard practice when it comes to decisions of the Director of case, there is nothing which shows that the President
Lands which are affirmed by the SANR is to allow appeals to the disapproved of the Executive Secretary’s actions.
Office of the President. In some cases, failure to appeal to the
SEPARATE
Office of the President may even be considered as a fatal defect,
OPINIONS
leading to dismissal of the case for non-exhaustion of all
administrative remedies. Fernando, J., concurring

1. When it comes to the appeal to the Office of the President, J.

Fernando believes that it is not just standard practice but is in
fact sound law. This is because the basis of this power of control
is the Constitution. He then proceeded to heavily quote Justice
Laurel, which is only a reiteration of the President’s power of
control.