Case Digest: Municipality of Jimenez v Baz, Jr., GR No. 105746, December 2, 1996

Municipality of Jimenez v Baz, Jr., GR No. 105746, December 2, 1996

Mendoza, J.:

Petitioners: 

1. Municipality of Jimenez

2. Taxpayers in the Province of Misamis Occidental and Jimenez, Misamis Occidental

Respondents: 

1. Hon. Vicente Baz, Jr., RTC-Oroquieta City

2. Municipality of Sinacaban

3. Province of Misamis Occidental

4. Commision on Audit

5. Department of Local Government

6. Department of Budget and Management

7. Executive Secretary Office of the President

Facts:

• On August 30, 1949, the Municipality of Sinacaban was created by Executive Order No. 258 issued by President Elpidio Quirino, under §68 of the Revised Administrative Code of 1917.

• The new municipality consisted of the southern portion of the Municipality of Jimenez in Misamis Occidental, including various barrios and sitios.

• Sinacaban officially began to exist upon the appointment and qualification of its mayor, vice-mayor, and councilors, and was required to assume a share of Jimenez's loan obligations.

• In 1988, Sinacaban claimed portions of Barrio Tabo-o and Barrios Macabayao, Adorable, Sinara Baja, and Sinara Alto, based on the technical description in Executive Order No. 258.

• The claim was filed with the Provincial Board of Misamis Occidental against the Municipality of Jimenez.

• Jimenez acknowledged that, according to E.O. No. 258, the disputed area is part of Sinacaban, but it asserted jurisdiction based on a 1950 agreement approved by the Provincial Board that fixed different boundaries.

• Provincial Board: Ruled the disputed area was part of Sinacaban and declared the previous agreement void, stating it had no power to alter boundaries fixed by E.O. No. 258; this power belonged to Congress.

• Jimenez filed a petition in the Regional Trial Court (RTC) of Oroquieta City, asserting that Sinacaban had no legal personality, as it was created by an executive order rather than legislative action, referencing the Pelaez v. Auditor General case.

• RTC-Oroquieta City: Ruled that Sinacaban is a de facto municipality, having exercised corporate powers for 40 years.

• Jimenez lacked standing to question Sinacaban's existence, a matter reserved for the State in a quo warranto proceeding.

• Jimenez was estopped from questioning Sinacaban's existence due to its long recognition and prior agreement.

• The question of Sinacaban's existence was moot under the Local Government Code of 1991, which recognized municipalities created by executive orders as regular municipalities.

• The RTC maintained the status quo, allowing Sinacaban to continue operating as a municipality, and nullified the Provincial Board’s decision fixing new boundaries.

Issues:

• Whether Sinacaban has legal personality to file a claim. YES

• Whether the boundary provided for in E.O. No. 258 or in Resolution No. 77 of the Provincial Board of Misamis Occidental which should be used as the basis for adjudicating Sinacaban's territorial claim.  E.O. No. 258

Held:

First. The preliminary issue concerns the legal existence of Sinacaban. If Sinacaban legally exists, then it has standing to bring a claim in the Provincial Board. Otherwise, it cannot.

The principal basis for the view that Sinacaban was not validly created as a municipal corporation is the ruling in Pelaez v. Auditor General that the creation of municipal corporations is essentially a legislative matter and therefore the President was without power to create by executive order the Municipality of Sinacaban. The ruling in this case has been reiterated in a number of cases later decided. However, we have since held that where a municipality created as such by executive order is later impliedly recognized and its acts are accorded legal validity, its creation can no longer be questioned. 

In Municipality of San Narciso, Quezon v. Mendez, Sr., this Court considered the following factors as having validated the creation of a municipal corporation, which, like the Municipality of Sinacaban, was created by executive order of the President before the ruling in Pelaez v. Auditor General: 

1. the fact that for nearly 30 years the validity of the creation of the municipality had never been challenged;

2. the fact that following the ruling in Pelaez no quo warranto suit was filed to question the validity of the executive order creating such municipality; and

3. the fact that the municipality was later classified as a fifth class municipality, organized as part of a municipal circuit court and considered part of a legislative district in the Constitution apportioning the seats in the House of Representatives. 

Above all, it was held that whatever doubt there might be as to the de jure character of the municipality must be deemed to have been put to rest by the Local Government Code of 1991 (R.A. No. 7160), §442(d) of which provides that "municipal districts organized pursuant to presidential issuances or executive orders and which have their respective sets of elective officials holding office at the time of the effectivity of this Code shall henceforth be considered as regular municipalities."

Here, the same factors are present so as to confer on Sinacaban the status of at least a de facto municipal corporation in the sense that its legal existence has been recognized and acquiesced publicly and officially. 

Sinacaban had been in existence for sixteen years when Pelaez v. Auditor General was decided on December 24, 1965. Yet the validity of E.O. No. 258 creating it had never been questioned. Created in 1949, it was only 40 years later that its existence was questioned and only because it had laid claim to an area that apparently is desired for its revenue. 

This fact must be underscored because under Rule 66, §16 of the Rules of Court, a quo warranto suit against a corporation for forfeiture of its charter must be commenced within five (5) years from the time the act complained of was done or committed. On the contrary, the State and even the Municipality of Jimenez itself have recognized Sinacaban's corporate existence. Under Administrative Order No. 33 dated June 13, 1978 of this Court, as reiterated by §31 of the Judiciary Reorganization Act of 1980 (B. P. Blg. 129), Sinacaban is constituted part of a municipal circuit for purposes of the establishment of Municipal Circuit Trial Courts in the country. For its part, Jimenez had earlier recognized Sinacaban in 1950 by entering into an agreement with it regarding their common boundary. The agreement was embodied in Resolution No. 77 of the Provincial Board of Misamis Occidental.

Indeed Sinacaban has attained de jure status by virtue of the Ordinance appended to the 1987 Constitution, apportioning legislative districts throughout the country, which considered Sinacaban part of the Second District of Misamis Occidental. Moreover, following the ruling in Municipality of San Narciso, Quezon v. Mendez, Sr., §442(d) of the Local Government Code of 1991 must be deemed to have cured any defect in the creation of Sinacaban. This provision states:

Municipalities existing as of the date of the effectivity of this Code shall continue to exist and operate as such. Existing municipal districts organized pursuant to presidential issuances or executive orders and which have their respective set of elective municipal officials holding office at the time of the effectivity of the Code shall henceforth be considered as regular municipalities.

Second. Jimenez claims, however, that R.A. No. 7160, §442(d) is invalid, since it does not conform to the constitutional and statutory requirements for the holding of plebiscites in the creation of new municipalities. 

This contention will not bear analysis. Since, as previously explained, Sinacaban had attained de facto status at the time the 1987 Constitution took effect on February 2, 1987, it is not subject to the plebiscite requirement. This requirement applies only to new municipalities created for the first time under the Constitution. Actually, the requirement of plebiscite was originally contained in Art. XI, §3 of the previous Constitution which took effect on January 17, 1973.  It cannot, therefore, be applied to municipal corporations created before, such as the Municipality of Sinacaban in the case at bar.

Third. Finally, Jimenez argues that the RTC erred in ordering a relocation survey of the boundary of Sinacaban because the barangays which Sinacaban are claiming are not enumerated in E.O. No. 258 and that in any event in 1950 the parties entered into an agreement whereby the barangays in question were considered part of the territory of Jimenez.

E.O. No. 258 does not say that Sinacaban comprises only the barrios (now called barangays) therein mentioned. What it says is that "Sinacaban contains" those barrios, without saying they are the only ones comprising it. The reason for this is that the technical description, containing the metes and bounds of its territory, is controlling. The trial court correctly ordered a relocation survey as the only means of determining the boundaries of the municipality and consequently the question to which the municipality the barangays in question belong.

Now, as already stated, in 1950 the two municipalities agreed that certain barrios belonged to Jimenez, while certain other ones belonged to Sinacaban. This agreement was subsequently approved by the Provincial Board of Misamis Occidental. Whether this agreement conforms to E.O. No. 258 will be determined by the result of the survey. Jimenez contends, however, that regardless of its conformity to E.O. No. 258, the agreement as embodied in Resolution No. 77 of the Provincial Board, is binding on Sinacaban. This raises the question whether the Provincial Board had authority to approve the agreement or, to put it in another way, whether it had the power to declare certain barrios part of one or the other municipality. We hold it did not if the effect would be to amend the area as described in E.O. No. 258 creating the Municipality of Sinacaban.

At the time the Provincial Board passed Resolution No. 77 on February 18, 1950, the applicable law was §2167 of the Revised Administrative Code of 1917 which provided:

Sec. 2167. Municipal boundary disputes. — How settled. — Disputes as to jurisdiction of municipal governments over places or barrios shall be decided by the provincial boards of the provinces in which such municipalities are situated, after an investigation at which the municipalities concerned shall be duly heard. From the decision of the provincial board appeal may be taken by the municipality aggrieved to the Secretary of the Interior [now the Office of the Executive Secretary], whose decision shall be final. Where the places or barrios in dispute are claimed by municipalities situated in different provinces, the provincial boards of the provinces concerned shall come to an agreement if possible, but, in the event of their failing to agree, an appeal shall be had to the Secretary of Interior [Executive Secretary], whose decision shall be final.

As held in Pelaez v. Auditor General, the power of provincial boards to settle boundary disputes is "of an administrative nature — involving, as it does, the adoption of means and ways to carry into effect the law creating said municipalities." It is a power "to fix common boundary, in order to avoid or settle conflicts of jurisdiction between adjoining municipalities." It is thus limited to implementing the law creating a municipality. It is obvious that any alteration of boundaries that is not in accordance with the law creating a municipality is not the carrying into effect of that law but its amendment. If, therefore, Resolution No. 77 of the Provincial Board of Misamis Occidental is contrary to the technical description of the territory of Sinacaban, it cannot be used by Jimenez as basis for opposing the claim of Sinacaban.

Jimenez properly brought to the RTC for review the decision of October 11, 1989 and Resolution No. 13-90 of the Provincial Board. Its action is in accordance with the Local Government Code of 1983, §79 of which provides that in case no settlement of boundary disputes is made the dispute should be elevated to the RTC of the province. In 1989, when the action was brought by Jimenez, this Code was the governing law. The governing law is now the Local Government Code of 1991 (R.A. No. 7160), §§118-119.

Jimenez's contention that the RTC failed to decide the case "within one year from the start of proceedings" as required by §79 of the Local Government Code of 1983 and the 90-day period provided for in Article VIII, §15 of the Constitution does not affect the validity of the decision rendered. For even granting that the court failed to decide within the period prescribed by law, its failure did not divest it of its jurisdiction to decide the case but only makes the judge thereof liable for possible administrative sanction.

WHEREFORE, the petition is DENIED and the decision of the Regional Trial Court of Oroquieta City, Branch 14 is AFFIRMED.

SO ORDERED.