FIRST DIVISION

[G.R. No. 145368. April 12, 2002.]

SALVADOR H. LAUREL , petitioner, vs . HON. ANIANO A. DESIERTO, in

his capacity as Ombudsman , respondent.

Laurel Law Office for petitioner.

The Solicitor General for respondent.

SYNOPSIS

The Evaluation and Preliminary Investigation Bureau of the O ce of the

Ombudsman directed petitioner, Chairman of the National Centennial Commission
(NCC), to submit his counter a davit on the charges of anomalies found by the Senate
Blue Ribbon and Saguisag Committees. The Blue Ribbon Committee recommended his
prosecution for violation of the rules on public bidding on the award of centennial
contracts and manifest bias in the issuance of the Notice to Proceed in the absence of
a valid contract, while the Saguisag Committee recommended the further investigation
of petitioner for violations of Section 3 (e) of RA. No. 3019, Section 4 (a) in relation to
Section 11 of R.A. 6713, and Article 217 of the Revised Penal Code. Petitioner moved to
dismiss on ground of lack of jurisdiction claiming that he is not a public o cer and that
NCC is a private organization. The motion was denied by the Ombudsman, hence, the
instant recourse.
The NCC was created under Administrative Order No. 223 and Executive Order
No. 128 to ensure a more coordinated and synchronized celebrations of the Philippine
Centennial and wider participation from the government and non-government or private
organizations. It aims to implement the state policies on the promotion of the nation's
historical and cultural heritage and resources. It is thus a public o ce performing
executive functions. Thus, the Chairman of this Committee is a public o cer who may
be investigated by the Office of the Ombudsman. DICSaH

SYLLABUS

1. POLITICAL LAW; ACCOUNTABILITY OF PUBLIC OFFICERS; OFFICE OF THE

OMBUDSMAN; POWER TO INVESTIGATE AND PROSECUTE; PLENARY AND UNQUALIFIED.
— In the Court's decision in Uy, we held that "it is the prosecutor, not the Ombudsman, who
has the authority to le the corresponding information/s against petitioner in the regional
trial court. The Ombudsman exercise prosecutorial powers only in cases cognizable by the
Sandiganbayan." The foregoing ruling in Uy, however, was short-lived. Upon motion for
clari cation by the Ombudsman in the same case, the Court set aside the foregoing
pronouncement in its Resolution dated March 20, 2001. The Court explained the rationale
for this reversal. The power to investigate and to prosecute granted by law to the
Ombudsman is plenary and unquali ed. It pertains to any act or omission of any public
o cer or employee when such act or omission appears to be illegal, unjust, improper or
inefficient. The law does not make a distinction between cases cognizable by the
Sandiganbayan and those cognizable by regular courts. It has been held that the clause
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 "any illegal act or omission of any public o cial" is broad enough to embrace any crime
committed by a public officer or employee.
2. POLITICAL LAW; ADMINISTRATIVE LAW; PUBLIC OFFICE AND PUBLIC
OFFICER, DEFINED. — A de nition of public o cers cited in jurisprudence is that provided
by Mechem, a recognized authority on the subject: A public o ce is the right, authority and
duty, created and conferred by law, by which, for a given period, either xed by law or
enduring at the pleasure of the creating power, an individual is invested with some portion
of the sovereign functions of the government, to be exercised by him for the bene t of the
public. The individual so invested is a public officer.
3. CONSTITUTIONAL LAW; EXECUTIVE DEPARTMENT; NATIONAL CENTENNIAL
COMMISSION (NCC) CREATED UNDER ADMINISTRATIVE ORDER NO. 223 AND
EXECUTIVE ORDER NO. 128 PERFORMS EXECUTIVE FUNCTIONS. — We hold that the NCC
performs executive functions. The executive power "is generally de ned as the power to
enforce and administer the laws. It is the power of carrying the laws into practical
operation and enforcing their due observance." The executive function, therefore, concerns
the implementation of the policies as set forth by law. Clearly, the NCC performs sovereign
functions. It is, therefore, a public office, and petitioner, as its Chair, is a public officer.
4. POLITICAL LAW; ADMINISTRATIVE LAW; PUBLIC OFFICE; SALARY, NOT A
NECESSARY CRITERION FOR DETERMINING NATURE OF POSITION. — A salary is a usual
but not a necessary criterion for determining the nature of the position. It is not conclusive.
The salary is a mere incident and forms no part of the o ce. Where a salary or fees is
annexed, the o ce is provided for it is a naked or honorary o ce, and is supposed to be
accepted merely for the public good. Hence, the o ce of petitioner as NCC Chair may be
characterized as an honorary o ce, as opposed to a lucrative o ce or an o ce of pro t,
i.e., one to which salary, compensation or fees are attached. But it is a public o ce,
nonetheless. cTCaEA

DECISION

KAPUNAN , J : p

On June 13, 1991, President Corazon C. Aquino issued Administrative Order No. 223
"constituting a Committee for the preparation of the National Centennial Celebration in
1998." The Committee was mandated "to take charge of the nationwide preparations for
the National Celebration of the Philippine Centennial of the Declaration of Philippine
Independence and the Inauguration of the Malolos Congress." 1
Subsequently, President Fidel V. Ramos issued Executive Order No. 128,
"reconstituting the Committee for the preparation of the National Centennial Celebrations
in 1988." It renamed the Committee as the "National Centennial Commission." Appointed
to chair the reconstituted Commission was Vice-President Salvador H. Laurel. Presidents
Diosdado M. Macapagal and Corazon C. Aquino were named Honorary Chairpersons. 2
Characterized as an "ad-hoc body," the existence of the Commission "shall terminate
upon the completion of all activities related to the Centennial Celebrations." 3 Like its
predecessor Committee, the Commission was tasked to "take charge of the nationwide
preparations for the National Celebration of the Philippine Centennial of the Declaration of
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 Philippine Independence and the Inauguration of the Malolos Congress."
Per Section 6 of the Executive Order, the Commission was also charged with the
responsibility to "prepare, for approval of the President, a Comprehensive Plan for the
Centennial Celebrations within six (6) months from the effectivity of" the Executive Order.
E.O. No. 128 also contained provisions for staff support and funding:
SEC. 3. The Commission shall be provided with technical and
administrative staff support by a Secretariat to be composed of, among others,
detailed personnel from the Presidential Management Staff, the National
Commission for Culture and the Arts, and the National Historical Institute. Said
Secretariat shall be headed by a full time Executive Director who shall be
designated by the President.

SEC. 4. The Commission shall be funded with an initial budget to be

drawn from the Department of Tourism and the president's Contingent Fund, in
an amount to be recommended by the Commission, and approved by the
President. Appropriations for succeeding years shall be incorporated in the budget
of the Office of the President.

Subsequently, a corporation named the Philippine Centennial Expo '98 Corporation

(Expocorp) was created. 4 Petitioner was among the nine (9) Expocorp incorporators, who
were also its rst nine (9) directors. Petitioner was elected Expocorp Chief Executive
Officer.
On August 5, 1998, Senator Ana Dominique Coseteng delivered a privilege speech in
the Senate denouncing alleged anomalies in the construction and operation of the
Centennial Exposition Project at the Clark Special Economic Zone. Upon motion of Senator
Franklin Drilon, Senator Coseteng's privilege speech was referred to the Committee on
Accountability of Public O cers and Investigation (The Blue Ribbon Committee) and
several other Senate Committees for investigation.
On February 24, 1999, President Joseph Estrada issued Administrative Order No.
35, creating an ad hoc and independent citizens' committee to investigate all the facts and
circumstances surrounding the Philippine centennial projects, including its component
activities. Former Senator Rene A.V. Saguisag was appointed to chair the Committee.
On March 23, 1999, the Senate Blue Ribbon Committee led with the Secretary of
the Senate its Committee Final Report No. 30 dated February 26, 1999. Among the
Committee's recommendations was "the prosecution by the Ombudsman/DOJ of Dr.
Salvador Laurel, chair of NCC and of EXPOCORP for violating the rules on public bidding,
relative to the award of centennial contracts to AK (Asia Construction & Development
Corp.); for exhibiting manifest bias in the issuance of the NTP (Notice to Proceed) to AK to
construct the FR (Freedom Ring) even in the absence of a valid contract that has caused
material injury to government and for participating in the scheme to preclude audit by COA
of the funds infused by the government for the implementation of the said contracts all in
violation . . . of the anti-graft law." 5
Later, on November 5, 1999, the Saguisag Committee issued its own report. It
recommended "the further investigation by the Ombudsman, and indictment, in proper
cases of," among others, NCC Chair Salvador H. Laurel for violations of Section 3(e) of R.A.
No. 3019, Section 4(a) in relation to Section 11 of R.A. No. 6713, and Article 217 of the
Revised Penal Code.
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 The Reports of the Senate Blue Ribbon and the Saguisag Committee were
apparently referred to the Fact- nding and Intelligence Bureau of the O ce of the
Ombudsman. On January 27, 2000, the Bureau issued its Evaluation Report,
recommending:
1. that a formal complaint be led and preliminary investigation be
conducted before the Evaluation and Preliminary Investigation Bureau
(EPIB), O ce of the Ombudsman against former NCC and EXPOCORP
chair Salvador H. Laurel, former EXPOCORP President Teodoro Q. Peña
and AK President Edgardo H. Angeles for violation of Sec. 3(e) and (g) of
R.A. No. 3019, as amended in relation to PD 1594 and COA Rules and
Regulations;
2. That the Fact Finding and Intelligence Bureau of this O ce, act as the
nominal complainant. 6

In an Order dated April 10, 2000, Pelagio S. Apostol, OIC-Director of the Evaluation
and Preliminary Investigation Bureau, directed petitioner to submit his counter-a davit
and those of his witnesses.
On April 24, 2000, petitioner led with the O ce of the Ombudsman a Motion to
Dismiss questioning the jurisdiction of said office.
In an Order dated June 13, 2000, the Ombudsman denied petitioner's motion to
dismiss.
On July 3, 2000, petitioner moved for a reconsideration of the June 13, 2000 Order
but the motion was denied in an Order dated October 5, 2000.
On October 25, 2000, petitioner filed the present petition for certiorari.
On November 14, 2000, the Evaluation and Preliminary Investigation Bureau issued a
resolution nding "probable cause to indict respondents SALVADOR H. LAUREL and
TEODORO Q. PEÑA before the Sandiganbayan for conspiring to violate Section 3(e) of
Republic Act No. 3019, in relation to Republic Act No. 1594." The resolution also directed
that an information for violation of the said law be led against Laurel and Peña.
Ombudsman Aniano A. Desierto approved the resolution with respect to Laurel but
dismissed the charge against Peña.
In a Resolution dated September 24, 2001, the Court issued a temporary restraining
order, commanding respondents to desist from ling any information before the
Sandiganbayan or any court against petitioner for alleged violation of Section 3(e) of the
Anti-Graft and Corrupt Practices Act.
On November 14, 2001, the Court, upon motion of petitioner, heard the parties in
oral argument.
Petitioner assails the jurisdiction of the Ombudsman on the ground that he is not a
public officer because:
A.
EXPOCORP, THE CORPORATION CHAIRED BY PETITIONER LAUREL WHICH
UNDERTOOK THE FREEDOM RING PROJECT IN CONNECTION WITH WHICH
VIOLATIONS OF THE ANTI-GRAFT AND CORRUPT PRACTICES WERE ALLEGEDLY
COMMITTED, WAS A PRIVATE CORPORATION, NOT A GOVERNMENT-OWNED OR
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 CONTROLLED CORPORATION.

B.
THE NATIONAL CENTENNIAL COMMISSION (NCC) WAS NOT A PUBLIC OFFICE.

C.
PETITIONER, BOTH AS CHAIRMAN OF THE NCC AND OF EXPOCORP WAS NOT A
"PUBLIC OFFICER" AS DEFINED UNDER THE ANTI-GRAFT & CORRUPT
PRACTICES ACT. 7

In addition, petitioner in his reply 8 invokes this Court's decision in Uy vs.

Sandiganbayan, 9 where it was held that the jurisdiction of the Ombudsman was limited to
cases cognizable by the Sandiganbayan, i.e., over public o cers of Grade 27 and higher.
As petitioner's position was purportedly not classi ed as Grade 27 or higher, the
Sandiganbayan and, consequently, the Ombudsman, would have no jurisdiction over him.
This last contention is easily dismissed. In the Court's decision in Uy, we held that "it
is the prosecutor, not the Ombudsman, who has the authority to le the corresponding
information/s against petitioner in the regional trial court. The Ombudsman exercises
prosecutorial powers only in cases cognizable by the Sandiganbayan."
In its Resolution of February 22, 2000, the Court expounded:
The clear import of such pronouncement is to recognize the authority of
the State and regular provincial and city prosecutors under the Department of
Justice to have control over prosecution of cases falling within the jurisdiction of
the regular courts. The investigation and prosecutorial powers of the Ombudsman
relate to cases rightfully falling within the jurisdiction of the Sandiganbayan
under Section 15 (1) of R.A. 6770 ("An Act Providing for the Functional and
Structural Organization of the O ce of the Ombudsman, and for other purposes")
which vests upon the Ombudsman "primary jurisdiction over cases cognizable by
the Sandiganbayan . . ." And this is further buttressed by Section 11 (4a) of R.A.
6770 which emphasizes that the O ce of the Special Prosecutor shall have the
power to "conduct preliminary investigation and prosecute criminal cases within
the jurisdiction of the Sandiganbayan." Thus, repeated references to the
Sandiganbayan's jurisdiction clearly serve to limit the Ombudsman's and Special
Prosecutor's authority to cases cognizable by the Sandiganbayan. [Emphasis in
the original.]

The foregoing ruling in Uy, however, was short-lived. Upon motion for clari cation by
the Ombudsman in the same case, the Court set aside the foregoing pronouncement in its
Resolution dated March 20, 2001. The Court explained the rationale for this reversal:
The power to investigate and to prosecute granted by law to the
Ombudsman is plenary and unquali ed. It pertains to any act or omission of any
public officer or employee when such act or omission appears to be illegal, unjust,
improper or ine cient . The law does not make a distinction between cases
cognizable by the Sandiganbayan and those cognizable by regular courts. It has
been held that the clause "any illegal act or omission of any public o cial" is
broad enough to embrace any crime committed by a public o cer or employee.
SIDEaA

The reference made by RA 6770 to cases cognizable by the

Sandiganbayan, particularly in Section 15(1) giving the Ombudsman primary
jurisdiction over cases cognizable by the Sandiganbayan, and Section 11(4)
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 granting the Special Prosecutor the power to conduct preliminary investigation
and prosecute criminal cases within the jurisdiction of the Sandiganbayan,
should not be construed as con ning the scope of the investigatory and
prosecutory power of the Ombudsman to such cases.

Section 15 of RA 6770 gives the Ombudsman primary jurisdiction over

cases cognizable by the Sandiganbayan. The law de nes such primary
jurisdiction as authorizing the Ombudsman "to take over, at any stage, from any
investigatory agency of the government, the investigation of such cases." The
grant of this authority does not necessarily imply the exclusion from its
jurisdiction of cases involving public o cers and employees by other courts. The
exercise by the Ombudsman of his primary jurisdiction over cases cognizable by
the Sandiganbayan is not incompatible with the discharge of his duty to
investigate and prosecute other offenses committed by public o cers and
employees. Indeed, it must be stressed that the powers granted by the legislature
to the Ombudsman are very broad and encompass all kinds of malfeasance,
misfeasance and non-feasance committed by public o cers and employees
during their tenure of office.
Moreover, the jurisdiction of the O ce of the Ombudsman should not be
equated with the limited authority of the Special Prosecutor under Section 11 of
RA 6770. The O ce of the Special Prosecutor is merely a component of the
O ce of the Ombudsman and may only act under the supervision and control
and upon authority of the Ombudsman. Its power to conduct preliminary
investigation and to prosecute is limited to criminal cases within the jurisdiction
of the Sandiganbayan. Certainly, the lawmakers did not intend to con ne the
investigatory and prosecutory power of the Ombudsman to these types of cases.
The Ombudsman is mandated by law to act on all complaints against o cers
and employees of the government and to enforce their administrative, civil and
criminal liability in every case where the evidence warrants. To carry out this duty,
the law allows him to utilize the personnel of his o ce and/or designate any
scal, state prosecutor or lawyer in the government service to act as special
investigator or prosecutor to assist in the investigation and prosecution of certain
cases. Those designated or deputized to assist him work under his supervision
and control. The law likewise allows him to direct the Special Prosecutor to
prosecute cases outside the Sandiganbayan's jurisdiction in accordance with
Section 11 (4c) of RA 6770.
The prosecution of offenses committed by public o cers and employees
is one of the most important functions of the Ombudsman. In passing RA 6770,
the Congress deliberately endowed the Ombudsman with such power to make
him a more active and effective agent of the people in ensuring accountability in
public o ce. A review of the development of our Ombudsman law reveals this
intent. [Emphasis in the original.]

Having disposed of this contention, we proceed to the principal grounds upon which
petitioner relies. We rst address the argument that petitioner, as Chair of the NCC, was
not a public officer. SAaTHc

The Constitution 10 describes the Ombudsman and his Deputies as "protectors of

the people," who "shall act promptly on complaints led in any form or manner against
public o cials or employees of the government, or any subdivision, agency or
instrumentality thereof, including government-owned or controlled corporations." Among
the awesome powers, functions, and duties vested by the Constitution 11 upon the O ce
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 of the Ombudsman is to "[i]nvestigate . . . any act or omission of any public o cial ,
employee, o ce or agency, when such act or omission appears to be illegal, unjust,
improper, or inefficient."
The foregoing constitutional provisions are substantially reproduced in R.A. No.
6770, otherwise known as the "Ombudsman Act of 1989." Sections 13 and 15(1) of said
law respectively provide:
SEC. 13. Mandate. — The Ombudsman and his Deputies, as protectors
of the people shall act promptly on complaints led in any form or manner
against o cers or employees of the Government, or of any subdivision, agency or
instrumentality thereof, including government-owned or controlled corporations,
and enforce their administrative, civil and criminal liability in every case where the
evidence warrants in order to promote e cient service by the Government to the
people.
SEC. 15. Powers, Functions and Duties. – The O ce of the
Ombudsman shall have the following powers, functions and duties:
(1) Investigate and prosecute on its own or on complaint by any
person, any act or omission of any public o cer or employee, o ce or agency,
when such act or omission appears to be illegal unjust, improper or ine cient. It
has primary jurisdiction over cases cognizable by the Sandiganbayan and, in the
exercise of this primary jurisdiction, it may take over, at any stage, from any
investigatory agency of Government, the investigation of such cases;
xxx xxx xxx.

The coverage of the law appears to be limited only by Section 16, in relation to
Section 13, supra:
SEC 16. Applicability. – The provisions of this Act shall apply to all
kinds of malfeasance, misfeasance and non-feasance that have been committed
by any officer or employee as mentioned in Section 13 hereof, during his tenure of
office.

In sum, the Ombudsman has the power to investigate any malfeasance,

misfeasance and non-feasance by a public o cer or employee of the government, or of
any subdivision, agency or instrumentality thereof, including government-owned or
controlled corporations. 1 2 SHEC cD

Neither the Constitution nor the Ombudsman Act of 1989, however, de nes who
public o cers are. A de nition of public o cers cited in jurisprudence 13 is that provided
by Mechem, a recognized authority on the subject:
A public o ce is the right, authority and duty, created and conferred by
law, by which, for a given period, either xed by law or enduring at the pleasure of
the creating power, an individual is invested with some portion of the sovereign
functions of the government, to be exercised by him for the bene t of the public.
The individual so invested is a public officer. 14

The characteristics of a public o ce, according to Mechem, include the delegation

of sovereign functions, its creation by law and not by contract, an oath, salary, continuance
of the position, scope of duties, and the designation of the position as an office. 1 5
Petitioner submits that some of these characteristics are not present in the position
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 of NCC Chair, namely: (1) the delegation of sovereign functions; (2) salary, since he
purportedly did not receive any compensation; and (3) continuance, the tenure of the NCC
being temporary.
Mechem describes the delegation to the individual of some of the sovereign
functions of government as "[t]he most important characteristic" in determining whether a
position is a public office or not.
The most important characteristic which distinguishes an o ce from an
employment or contract is that the creation and conferring of an o ce involves a
delegation to the individual of some of the sovereign functions of government, to
be exercised by him for the bene t of the public; – that some portion of the
sovereignty of the country, either legislative, executive or judicial, attaches, for the
time being, to be exercised for the public bene t. Unless the powers conferred are
of this nature, the individual is not a public officer. 16

Did E.O. 128 delegate the NCC with some of the sovereign functions of government?
Certainly, the law did not delegate upon the NCC functions that can be described as
legislative or judicial. May the functions of the NCC then be described as executive?
We hold that the NCC performs executive functions. The executive power "is
generally de ned as the power to enforce and administer the laws. It is the power of
carrying the laws into practical operation and enforcing their due observance." 17 The
executive function, therefore, concerns the implementation of the policies as set forth by
law.
The Constitution provides in Article XIV (Education, Science and Technology, Arts,
Culture, and Sports) thereof: aDcTHE

SEC. 15. Arts and letters shall enjoy the patronage of the State. The
State shall conserve, promote, and popularize the nation's historical and cultural
heritage and resources, as well as artistic creations.

In its preamble, A.O. No. 223 states the purposes for the creation of the Committee
for the National Centennial Celebrations in 1998:
WHEREAS, the birth of the Republic of the Philippines is to be celebrated in
1998, and the centennial presents an important vehicle for fostering nationhood
and a strong sense of Filipino identity;

WHEREAS, the centennial can effectively showcase Filipino heritage and

thereby strengthen Filipino values;

WHEREAS, the success of the Centennial Celebrations may be insured only

through long-range planning and continuous developmental programming;

WHEREAS, the active participation of the private sector in all areas of

special expertise and capability, particularly in communication and information
dissemination, is necessary for long-range planning and continuous
developmental programming;
WHEREAS, there is a need to create a body which shall initiate and
undertake the primary task of harnessing the multisectoral components from the
business, cultural, and business sectors to serve as effective instruments from the
launching and overseeing of this long-term project;

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 xxx xxx xxx.

E.O. No. 128, reconstituting the Committee for the National Centennial Celebrations
in 1998, cited the "need to strengthen the said Committee to ensure a more coordinated
and synchronized celebrations of the Philippine Centennial and wider participation from
the government and non-government or private organizations." It also referred to the "need
to rationalize the relevance of historical links with other countries."
The NCC was precisely created to execute the foregoing policies and objectives, to
carry them into effect. Thus, the Commission was vested with the following functions:
(a) To undertake the overall study, conceptualization, formulation and
implementation of programs and projects on the utilization of culture,
arts, literature and media as vehicles for history, economic endeavors,
and reinvigorating the spirit of national unity and sense of
accomplishment in every Filipino in the context of the Centennial
Celebrations. In this regard, it shall include a Philippine National
Exposition '98 within Metro Manila, the original eight provinces, and
Clark Air Base as its major venues;
(b) To act as principal coordinator for all the activities related to
awareness and celebration of the Centennial;
(c) To serve as the clearing house for the preparation and dissemination
of all information about the plans and events for the Centennial
Celebrations;
(d) To constitute working groups which shall undertake the
implementation of the programs and projects;
(e) To prioritize the refurbishment of historical sites and structures
nationwide. In this regard, the Commission shall formulate schemes
(e.g. lease-maintained-and-transfer, build-operate-transfer, and similar
arrangements) to ensure the preservation and maintenance of the
historical sites and structures;
(f) To call upon any government agency or instrumentality and
corporation, and to invite private individuals and organizations to
assist it in the performance of its tasks; and,
(g) Submit regular reports to the President on the plans, programs,
projects, activities as well as the status of the preparations for the
Celebration. 18
It bears noting the President, upon whom the executive power is vested, 19 created
the NCC by executive order. Book III (O ce of the President), Chapter 2 (Ordinance
Power), Section 2 describes the nature of executive orders:
SEC. 2. Executive Orders. – Acts of the President providing for rules of
a general or permanent character in implementation or execution of constitutional
or statutory powers shall be promulgated in executive orders. [Italics ours.]
Furthermore, the NCC was not without a role in the country's economic
development, especially in Central Luzon. Petitioner himself admitted as much in the oral
arguments before this Court:
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 MR. JUSTICE REYNATO S. PUNO:
And in addition to that expounded by Former President Ramos, don't you
agree that the task of the centennial commission was also to focus on the long
term over all socio economic development of the zone and Central Luzon by
attracting investors in the area because of the eruption of Mt. Pinatubo.

FORMER VICE PRESIDENT SALVADOR H. LAUREL:

I am glad Your Honor touched on that because that is something I wanted
to touch on by lack of material time I could not but that is a very important point.
When I was made Chairman I wanted the Expo to be in Batangas because I am a
Batangeño but President Ramos said Mr. Vice President the Central Luzon is
suffering, suffering because of the eruption of Mt. Pinatubo let us try to catalize
[sic] economic recovery in that area by putting this Expo in Clark Field and so it
was done I agreed and Your Honor if I may also mention we wanted to generate
employment aside from attracting business investments and employment. And
the Estrada administration decided to junk this project there 48, 40 thousand
people who lost job, they were employed in Expo. And our target was to provide
75 thousand jobs. It would have really calibrated, accelerated the development of
Central Luzon. Now, I think they are going back to that because they had the
airport and there are plan to revive the Expo site into key park which was the
original plan.

There can hardly be any dispute that the promotion of industrialization and full
employment is a fundamental state policy. 2 0
Petitioner invokes the ruling of this Court in Torio vs. Fontanilla 21 that the holding by
a municipality of a town fiesta is a proprietary rather than a governmental function.
Petitioner argues that the "holding of a nationwide celebration which marked the nation's
100th birthday may be likened to a national esta which involved only the exercise of the
national government's proprietary function." 22 In Torio, we held:
[Section 2282 of the Chapter on Municipal Law of the Revised
Administrative Code] simply gives authority to the municipality to [celebrate] a
yearly fiesta but it does not impose upon it a duty to observe one. Holding a esta
even if the purpose is to commemorate a religious or historical event of the town
is in essence an act for the special bene t of the community and not for the
general welfare of the public performed in pursuance of a policy of the state. The
mere fact that the celebration, as claimed, was not to secure pro t or gain but
merely to provide entertainment to the town inhabitants is not a conclusive test.
For instance, the maintenance of parks is not a source of income for the town,
nonetheless it is [a] private undertaking as distinguished from the maintenance of
public schools, jails, and the like which are for public service.
As stated earlier, there can be no hard and fast rule for purposes of
determining the true nature of an undertaking or function of a municipality; the
surrounding circumstances of a particular case are to be considered and will be
decisive. The basic element, however bene cial to the public the undertaking may
be, is that it is government in essence, otherwise, the function becomes private or
propriety in character. Easily, no governmental or public policy of the state is
involved in the celebration of a town fiesta.

Torio, however, did not intend to lay down an all-encompassing doctrine. Note that
the Court cautioned that "there can be no hard and fast rule for purposes of determining
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 the true nature of an undertaking or function of a municipality; the surrounding
circumstances of a particular case are to be considered and will be decisive." Thus, in
footnote 15 of Torio, the Court, citing an American case, illustrated how the "surrounding
circumstances plus the political, social, and cultural backgrounds" could produce a
conclusion different from that in Torio:
We came across an interesting case which shows that surrounding
circumstances plus the political, social, and cultural backgrounds may have a
decisive bearing on this question. The case of Pope v. City of New Haven, et al .
was an action to recover damages for personal injuries caused during a Fourth of
July reworks display resulting in the death of a bystander alleged to have been
caused by defendants' negligence. The defendants demurred to the complaint
invoking the defense that the city was engaged in the performance of a public
governmental duty from which it received no pecuniary bene t and for negligence
in the performance of which no statutory liability is imposed. This demurrer was
sustained by the Superior Court of New Haven Country. Plaintiff sought to amend
his complaint to allege that the celebration was for the corporate advantage of
the city. This was denied. In a rming the order, the Supreme Court of Errors of
Connecticut held inter alia:
Municipal corporations are exempt from liability for the negligent
performance of purely public governmental duties, unless made liable by statute. .
..

A municipality corporation, which under permissive authority of its charter

or of statute, conducted a public Fourth of July celebration, including a display of
reworks, and sent up a bomb intended to explode in the air, but which failed to
explode until it reached the ground, and then killed a spectator, was engaged in
the performance of a governmental duty. (99 A.R. 51)

This decision was concurred in by three Judges while two dissented.

At any rate the rationale of the Majority Opinion is evident from [this]
excerpt:

"July 4th, when that date falls upon Sunday, July 5th, is made a public
holiday, called Independence Day, by our statutes. All or nearly all of the other
states have similar statutes. While there is no United States statute making a
similar provision, the different departments of the government recognize, and
have recognized since the government was established, July 4th as a national
holiday. Throughout the country it has been recognized and celebrated as such.
These celebrations, calculated to entertain and instruct the people generally and
to arouse and stimulate patriotic sentiments and love of country, frequently take
the form of literary exercises consisting of patriotic speeches and the reading of
the Constitution, accompanied by a musical program including patriotic air
sometimes preceded by the ring of cannon and followed by reworks. That such
celebrations are of advantage to the general public and their promotion a proper
subject of legislation can hardly be questioned. . . . "

Surely, a town fiesta cannot compare to the National Centennial Celebrations. The
Centennial Celebrations was meant to commemorate the birth of our nation after centuries
of struggle against our former colonial master, to memorialize the liberation of our people
from oppression by a foreign power. 1998 marked 100 years of independence and
sovereignty as one united nation. The Celebrations was an occasion to re ect upon our
history and reinvigorate our patriotism. As A.O. 223 put it, it was a "vehicle for fostering
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 nationhood and a strong sense of Filipino identity," an opportunity to "showcase Filipino
heritage and thereby strengthen Filipino values." The signi cance of the Celebrations could
not have been lost on petitioner, who remarked during the hearing:
Oh, yes, certainly the State is interested in the unity of the people, we
wanted to rekindle the love for freedom, love for country, that is the over-all goal
that has to make everybody feel proud that he is a Filipino, proud of our history,
proud of what our forefather did in their time. . . . .

Clearly, the NCC performs sovereign functions. It is, therefore, a public o ce, and
petitioner, as its Chair, is a public officer.
That petitioner allegedly did not receive any compensation during his tenure is of
little consequence. A salary is a usual but not a necessary criterion for determining the
nature of the position. It is not conclusive. The salary is a mere incident and forms no part
of the o ce. Where a salary or fees is annexed, the o ce is provided for it is a naked or
honorary o ce, and is supposed to be accepted merely for the public good. 23 Hence, the
o ce of petitioner as NCC Chair may be characterized as an honorary o ce, as opposed
to a lucrative o ce or an o ce of pro t, i.e., one to which salary, compensation or fees are
attached. 24 But it is a public office, nonetheless.
Neither is the fact that the NCC was characterized by E.O. No. 128 as an " ad-hoc
body" make said commission less of a public office.
The term o ce, it is said, embraces the idea of tenure and duration, and
certainly a position which is merely temporary and local cannot ordinarily be
considered an o ce. "But," says Chief Justice Marshall, "if a duty be a continuing
one, which is de ned by rules prescribed by the government and not by contract,
which an individual is appointed by government to perform, who enters on the
duties pertaining to his station without any contract de ning them, if those duties
continue though the person be changed, — it seems very di cult to distinguish
such a charge or employment from an o ce of the person who performs the
duties from an officer."

At the same time, however, this element of continuance can not be

considered as indispensable, for, if the other elements are present "it can make no
difference," says Pearson, C.J., "whether there be but one act or a series of acts to
be done, — whether the o ce expires as soon as the one act is done, or is to be
held for years or during good behavior." 25
Our conclusion that petitioner is a public o cer nds support in In Re Corliss. 26
There the Supreme Court of Rhode Island ruled that the o ce of Commissioner of the
United States Centennial Commission is an "o ce of trust" as to disqualify its holder as
elector of the United States President and Vice-President. (Under Article II of the United
States Constitution, a person holding an o ce of trust or pro t under the United States is
disqualified from being appointed an elector.)
. . . . We think a Commissioner of the United States Centennial Commission
holds an o ce of trust under the United States, and that he is therefore
disquali ed for the o ce of elector of President and Vice-President of the United
States.

The commission was created under a statute of the United States

approved March 3, 1871. That statute provides for the holding of an exhibition of
American and foreign arts, products, and manufactures, "under the auspices of
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 the government of the United States," and for the constitution of a commission, to
consist of more than one delegate from each State and from each Territory of the
United States, "whose functions shall continue until close of the exhibition," and
"whose duty it shall be to prepare and superintend the execution of the plan for
holding the exhibition." Under the statute the commissioners are appointed by the
President of the United States, on the nomination of the governor of the States
and Territories respectively. Various duties were imposed upon the commission,
and under the statute provision was to be made for it to have exclusive control of
the exhibit before the President should announce, by proclamation, the date and
place of opening and holding the exhibition. By an act of Congress approved
June 1st, 1872, the duties and functions of the commission were further
increased and de ned. That act created a corporation, called "The Centennial
Board of Finance," to cooperate with the commission and to raise and disburse
the funds. It was to be organized under the direction of the commission. The
seventh section of the act provides "that the grounds for exhibition shall be
prepared and the buildings erected by the corporation, in accordance with plans
which shall have been adopted by the United States Centennial Commission; and
the rules and regulations of said corporation, governing rates for entrance and
admission fees, or otherwise affecting the rights, privileges, or interests of the
exhibitors, or of the public, shall be xed and established by the United States
Centennial Commission; and no grant conferring rights or privileges of any
description connected with said grounds or buildings, or relating to said exhibition
or celebration, shall be made without the consent of the United States Centennial
Commission, and said commission shall have power to control, change, or revoke
all such grants, and shall appoint all judges and examiners and award all
premiums." The tenth section of the act provides that "it shall be the duty of the
United States Centennial Commission to supervise the closing up of the affairs of
said corporation, to audit its accounts, and submit in a report to the President of
the United States the financial results of the centennial exhibition."
It is apparent from this statement, which is but partial, that the duties and
functions of the commission were various, delicate, and important; that they
could be successfully performed only by men of large experience and knowledge
of affairs; and that they were not merely subordinate and provisional, but in the
highest degree authoritative, discretionary, and nal in their character. We think
that persons performing such duties and exercising such functions, in pursuance
of statutory direction and authority, are not to be regarded as mere employees,
agents, or committee men, but that they are, properly speaking, o cers, and that
the places which they hold are o ces. It appears, moreover, that they were
originally regarded as o cers by Congress; for the act under which they were
appointed declares, Section 7, that "no compensation for services shall be paid to
the commissioners or other o cers , provided for in this act, from the treasury of
the United States." The only other o cers provided for were the "alternates"
appointed to serve as commissioners when the commissioners were unable to
attend.

Having arrived at the conclusion that the NCC performs executive functions and is,
therefore, a public o ce, we need no longer delve at length on the issue of whether
Expocorp is a private or a public corporation. Even assuming that Expocorp is a private
corporation, petitioner's position as Chief Executive O cer (CEO) of Expocorp arose from
his Chairmanship of the NCC. Consequently, his acts or omissions as CEO of Expocorp
must be viewed in the light of his powers and functions as NCC Chair. 27
Finally, it is contended that since petitioner supposedly did not receive any
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 compensation for his services as NCC or Expocorp Chair, he is not a public o cer as
de ned in Republic Act No. 3019 (The Anti-Graft and Corrupt Practices Act) and is,
therefore, beyond the jurisdiction of the Ombudsman.
Respondent seeks to charge petitioner with violation of Section 3 (e) of said law,
which reads:
SEC. 3. Corrupt practices of public o cers . – In addition to acts or
omissions of public o cers already penalized by existing law, the following shall
constitute corrupt practices of any public o cer and are hereby declared to be
unlawful:

xxx xxx xxx

(e) Causing any undue injury to any party, including the Government,
or giving any private party any unwarranted bene ts, advantage or preference in
the discharge of his o cial, administrative or judicial functions through manifest
partiality, evident bad faith or gross inexcusable negligence. This provision shall
apply to o cers and employees of o ces or government corporations charged
with the grant of licenses or permits or other concessions.

A "public officer," under R.A. No. 3019, is defined by Section 2 of said law as follows:
SEC. 2. Definition of terms. – As used in this Act, the term –
xxx xxx xxx
(b) "Public o cer" includes elective and appointive o cials and
employees, permanent or temporary, whether in the classi ed or unclassi ed or
exemption service receiving compensation, even nominal, from the government
as defined in the preceding paragraph. [Italics supplied.]

It is clear from Section 2 (b), above, that the de nition of a "public o cer" is
expressly limited to the application of R.A. No. 3019. Said de nition does not apply for
purposes of determining the Ombudsman's jurisdiction, as de ned by the Constitution and
the Ombudsman Act of 1989.
Moreover, the question of whether petitioner is a public o cer under the Anti-Graft
and Corrupt Practices Act involves the appreciation of evidence and interpretation of law,
matters that are best resolved at trial.
To illustrate, the use of the term "includes" in Section 2 (b) indicates that the
de nition is not restrictive. 28 The Anti-Graft and Corrupt Practices Act is just one of
several laws that de ne "public o cers." Article 203 of the Revised Penal Code, for
example, provides that a public officer is:
. . . any person who, by direct provision of law, popular election or
appointment by competent authority, takes part in the performance of public
functions in the Government of Philippines, or performs in said Government or in
any of its branches public duties as an employee, agent or subordinate o cial, of
any rank or class.

Section 2 (14) of the Introductory Provisions of the Administrative Code of 1987, 29 on

the other hand, states:
O cer – as distinguished from "clerk" or "employee," refers to a person
whose duties not being of a clerical or manual nature, involves the exercise of
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 discretion in the performance of the functions of the government. When used with
reference to a person having authority to do a particular act or perform a
particular person in the exercise of governmental power, "o cer" includes any
government employee, agent or body having authority to do the act or exercise
that function.

It bears noting that under Section 3 (b) of Republic Act No. 6713 (The Code of Conduct
and Ethical Standards for Public O cials and Employees), one may be considered a
"public official" whether or not one receives compensation, thus:
"Public O cials" include elective and appointive o cials and employees,
permanent or temporary, whether in the career or non-career service including
military and police personnel, whether or not they receive compensation,
regardless of amount.

Which of these definitions should apply, if at all?

Assuming that the de nition of public o cer in R.A. No. 3019 is exclusive, the term
"compensation," which is not defined by said law, has many meanings.
Under particular circumstances, "compensation" has been held to include
allowance for personal expenses, commissions, expenses, fees, an honorarium,
mileage or traveling expenses, payments for services, restitution or a balancing of
accounts, salary, and wages. 30

How then is "compensation," as the term is used in Section 2 (b) of R.A. No. 3019, to be
interpreted?
Did petitioner receive any compensation at all as NCC Chair? Granting that petitioner
did not receive any salary, the records do not reveal if he received any allowance, fee,
honorarium, or some other form of compensation. Notably, under the by-laws of Expocorp,
the CEO is entitled to per diems and compensation. 3 1 Would such fact bear any
significance?
Obviously, this proceeding is not the proper forum to settle these issues lest we
preempt the trial court from resolving them.
WHEREFORE, the petition is DISMISSED. The preliminary injunction issued in the
Court's Resolution dated September 24, 2001 is hereby LIFTED.
SO ORDERED.
Puno and Ynares-Santiago, JJ., concur.
Davide, Jr., C.J., took no part, due to close relations to a party.

Footnotes
1. A.O. 223, Section 1. The same section provided for the Committee's composition as
follows:

. . . . The Committee shall be composed of six (6) representatives from the

Presidential Commission for Culture and the Arts (PCCA), and five (5) representatives
from the Philippine Centennial Foundation, Inc. (PCFI). They shall be appointed by the
President upon their nomination by their respective groups.
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 The Committee members shall elect among themselves the Chairman and Vice-
Chairman, and such other officers as they may deem necessary.
The Committee was also granted the following duties and powers:

1. To undertake the overall study, formulation and implementation of programs and

projects on the utilization of culture, arts, and media as vehicles for value education in
the context of the Centennial Celebration;
2. To act as principal coordinator for all the activities related to awareness and
celebration of the centennial;

3. To constitute sub-committees and working groups which shall undertake the

implementation of the program and projects; and
4. To call upon the assistance of any government agency or instrumentality and
corporation, and to invite private individuals and organizations to assist it in the
performance of its tasks. (Id., at Section 2.)
2. Other members of the Commission were the Secretaries of Education, Culture and
Sports, National Defense, Interior and Local Government, Tourism, Trade and Industry,
Public Works and Highways, Transportation and Communications, and Budget and
Management, the Press Secretary, two (2) representatives each from the Senate and the
House of Representatives, two (2) representatives from the Judiciary, the Executive
Director of the National Historical Institute, three (3) representatives from the National
Commission for Culture and Arts, three (3) representatives from the Philippine Centennial
Foundation, Inc., and other members from the government and the private sectors, "as
may be designated later." (E.O. No. 128, Section 1.)

3. Id., at Section 5.
4. The purposes of the corporation were set forth in Article 2 of the Articles of Incorporation,
thus:

PRIMARY PURPOSE

To set up and establish the Philippine Centennial International Exposition 1998 (EXPO
'98), a project of the National Centennial Commission envisioned and mandated under
Executive Order No. 128, series of 1993, in the Clark Special Economic Zone (CSEZ)
within the Provinces of Pampanga and Tarlac, Philippines as created, defined and
delineated under Proclamation No. 163, series 1993, of the President of the Philippines
and furtherance of said purpose;

1. To operate, administer, manage, implement, and develop EXPO '98 conformably to

and in accordance with the Detailed Feasibility study and Master Plan for said
Exposition prepared by DOUGLAS/GALLAGHER, INC. and approved by the President of
the Philippines;

2. To exercise oversight functions and overall jurisdiction over the operations of EXPO
'98 as well as manage and oversee all plans, programs, and activities related to the
implementation and operation of said Exposition;

3. To regulate the establishment, operation, and maintenance of utilities, services, and

infrastructure works in all the site components of EXPO '98 and its support facilities;

4. To oversee the preparations for the implementation of the participation of countries,

groups, organizations, and entities at EXPO '98;

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 5. To establish linkages with participating countries and coordinate their programs
and activities relevant to the theme of EXPO '98;

6. To provide and prescribe the guidelines for the design and fabrication of the
pavilions of participating countries that played a significant role in Philippine historical
development and of other participating groups, organizations, and entities which would
be reflective of the following objectives of EXPO '98 —

a) showcase the national vision of the Philippines, highlighted by a rich history and
culture, and its traditional heritage and diverse cultural influences;
b) express eloquently the Filipinism sentiment of the Philippine Centennial;

c) strengthen cultural and historical linkages between Philippines and participating

countries;
d) create an image of the Philippines as a country with rich trade and tourism
potentials; and

e) project the Filipino character and strengthen the sense of national pride and
patriotism among the Filipino people.
7. To conceive and devise varied promotional strategies towards creating awareness
and appreciation of EXPO '98 as the centerpiece of the national celebrations in 1998 of
the centennial of the declaration of Philippine Independence and beyond that as a
permanent site for the Filipino people to honor their rich heritage;

8. To encourage and invite the active and meaningful participation of the private
sector in managing and overseeing EXPO '98; and

9. To forge strategic partnerships and joint ventures with local and international
investors and developers in the development, maintenance, operation, and management
of EXPO '98 on a turn-key basis.
SECONDARY PURPOSES

(1) To purchase, acquire, own, lease, sell and convey real properties such as lands,
buildings, factories and warehouses and machineries, equipment and other personal
properties as may be necessary or incidental to the conduct of the corporate business,
and to pay in cash, shares of its capital stock, debentures and other evidences of
indebtedness, or other securities, as may be deemed expedient, for any business or
property acquired by the corporation.

(2) To borrow or raise money necessary to meet the financial requirements of its
business by the issuance of bonds, promissory notes and other evidences of
indebtedness, and to secure the repayment thereof by mortgage, pledge, deed of trust or
lien upon the properties of the corporation or to issue pursuant to law shares of its
capital stock, debentures and other evidences of indebtedness in payment for properties
acquired by the corporation or for money borrowed in the prosecution of its lawful
business;

(3) To invest and deal with the money and properties of the corporation in such
manner as may from time to time be considered wise or expedient for the advancement
of its interests and to sell, dispose of or transfer the business, properties and goodwill of
the corporation or any part thereof for such consideration and under such terms as it
shall see fit to accept;

(4) To aid in any manner any corporation, association, or trust estate, domestic or
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 foreign, or any firm or individual, any shares of stock in which or any bonds, debentures,
notes, securities, evidences of indebtedness, contracts, or obligations of which are held
by or for this corporation, directly or indirectly or through other corporations or otherwise;

(5) To enter into any lawful arrangement for sharing profits, union of interest,
unitization or farmout agreement, reciprocal concession, or cooperation, with any
corporation, association, partnership, syndicate, entity, person or governmental,
municipal or public authority, domestic or foreign, in the carrying on of any business or
transaction deemed necessary, convenient or incidental to carrying out any of the
purposes of this corporation;

(6) To acquire or obtain from any government or authority, national, provincial,

municipal or otherwise, or a corporation, company or partnership or person, such charter,
contracts, franchise, privileges, exemption, licenses and concessions as may be
conducive to any of the objects of the corporation;

(7) To establish and operate one or more branch offices of agencies and to carry on
any or all of its operations and business without any restrictions as to place or amount
including the right to hold, purchase or otherwise acquire, lease, mortgage, pledge and
convey or otherwise deal in with real and personal property anywhere within the
Philippines;

(8) To conduct and transact any and all lawful business, and to do or cause to be
done any one or more of the acts and things herein set forth as its purposes, within or
without the Philippines, and in any and all foreign countries, and to do everything
necessary, desirable or incidental to the accomplishment of the purposes or the exercise
of any one or more of the powers herein enumerated, or which shall at any time appear
conducive to or expedient for the protection or benefit of this corporation.

5. Rollo, p. 10.
6. Id., at 134-135.
7. Id., at 15.
8. Id., at 296-297.
9. 312 SCRA 77 (1999).

10. Art. XI, SEC. 12.

11. Art. XI, SEC. 13 (1).

12. Section 22 extends these investigatory powers, under certain conditions, to private
persons:

SEC. 22. Investigatory Power. — The Office of the Ombudsman shall have the
power to investigate any serious misconduct in office allegedly committed by officials
removable by impeachment, for the purpose of filing a verified complaint for
impeachment or over Members of Congress, and the Judiciary.

In all cases of conspiracy between an officer or employee of the government and

a private person, the Ombudsman and his Deputies shall have jurisdiction to include
such private person as the evidence may warrant. The officer or employee and the
private person shall be tried jointly and shall be subject to the same penalties and
liabilities.

13. E.g., Fernandez vs. Ledesma, 7 SCRA 620 (1963); Aparri vs. Court of Appeals, 127 SCRA
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 231 (1984).

14. F.R. MECHEM, A TREATISE ON THE LAW OF PUBLIC OFFICES AND OFFICERS, §1.
15. Id., at §§4-10. See also 63C Am Jur. 2d, Public Officers and Employees §1.
16. Id., at §4.
17. Ople vs. Torres, 293 SCRA 141 (1998).
18. Id., at Sec. 2.
19. CONSTITUTION, ARTICLE VII, SECTION 1.
20. Article XII (National Economy and Patrimony) of the Constitution provides:

Section 1. . . . .
The State shall promote industrialization and full employment based on sound
agricultural development and agrarian reform, through industries that make full and
efficient use of human and natural resources, and which are competitive in both
domestic and foreign markets. . . . .

In the pursuit of these goals, all sectors of the economy and all regions of the
country shall be given optimum opportunity to develop. . . . .

21. 85 SCRA 599 (1978).

22. Rollo, p. 466.

23. Id., at §§7, 15. See also Triste vs. Leyte State College Board of Trustees, 192 SCRA 326
(1990).

24. Id., at §13.

25. Id., at § 8. Italics supplied.
26. 23 Am Rep. 538 (1876).

27. See Yasay vs. Desierto, 300 SCRA 494 (1998).

28. Preclaro vs. Sandiganbayan, 247 SCRA 454 (1995).
29. Executive Order No. 292.
30. 15 C.J.S. Compensation, p. 654.

31. Rollo, p. 470.

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