Civil Service Commission vs. Yu

A government employee who is validly appointed to a devolved position acquires a vested right to that position and to its re-classified designation upon re-nationalization, and must be automatically re-appointed by the Secretary of the department concerned in accordance with the guidelines for re-nationalization. The devolution of personnel and positions under R.A. No. 7160 is mandatory, and the refusal of a local chief executive to accept an incumbent does not prevent the devolution from taking effect by operation of law.

In 1992, the national government implemented a devolution program pursuant to Republic Act No. 7160, otherwise known as "The Local Government Code of 1991," which affected the Department of Health (DOH) along with other government agencies. The devolution program mandated national agencies to transfer to local government units the responsibility for the provision of basic services and facilities, including the transfer of records, equipment, assets, and personnel corresponding to devolved powers, functions, and responsibilities. Executive Order No. 503, otherwise known as the "Rules and Regulations Implementing the Transfer of Personnel and Assets, Liabilities and Records of National Government Agencies Whose Functions Are To Be Devolved To The Local Government Units And For Other Related Purposes," laid down the guidelines for the transfer of personnel, requiring mandatory absorption of NGA personnel by LGUs except when not administratively viable.

Prior to the devolution program implemented in 1992 pursuant to R.A. No. 7160, Dr. Fortunata Castillo held the position of Provincial Health Officer II (PHO II) of the Department of Health (DOH) Regional Office No. IX in Zamboanga City and was the head of both the Basilan Provincial Health Hospital and Public Health Services. Respondent Dr. Agnes Ouida P. Yu held the position of Provincial Health Officer I (PHO I) and was assigned at the Integrated Provincial Health Office in Isabela, Basilan.

Upon implementation of the devolution program, then Basilan Governor Gerry Salapuddin refused to accept Dr. Castillo as the incumbent of the PHO II position that was to be devolved to the local government unit of Basilan. This prompted the DOH to retain Dr. Castillo at the Regional Office No. IX in Zamboanga City where she would serve the remaining four years of her public service. She retired in 1996. In 1994, two years after the implementation of the devolution program, Governor Salapuddin appointed Dr. Yu to the PHO II position.

On February 23, 1998, Republic Act No. 8543, "An Act Converting the Basilan Provincial Hospital in the Municipality of Isabela, Province of Basilan, into a Tertiary Hospital Under the Full Administrative and Technical Supervision of the Department of Health, Increasing the Capacity to One Hundred Beds and Appropriating Funds Therefor," was passed into law, whereby the hospital positions previously devolved to the local government unit of Basilan were re-nationalized and reverted to the DOH. The Basilan Provincial Health Hospital was later renamed the Basilan General Hospital, and the position of PHO II was re-classified to Chief of Hospital II. While Dr. Yu was among the personnel reverted to the DOH with the re-nationalization of the Basilan General Hospital, she was made to retain her original item of PHO II instead of being given the re-classified position of Chief of Hospital II. Subsequently, on August 1, 2003, then DOH Secretary Manuel M. Dayrit appointed Dr. Domingo Remus A. Dayrit to the position of Chief of Hospital II.

Aggrieved, Dr. Yu filed a letter of protest dated September 30, 2003 before the CSC claiming that she has a vested right to the position of Chief of Hospital II. She argued that the position of Chief of Hospital II to which Dr. Dayrit had been appointed was a mere conversion from the item of Provincial Health Officer II previously occupied by her. She claimed that when the Basilan Provincial Hospital was re-nationalized, the position of PHO II, then occupied by her, was refused re-nationalization by the DOH alleging the same position to be an LGU-created position. Instead of being automatically re-appointed PHO II of the Hospital, later to be renamed Chief of Hospital II, pursuant to the Re-Nationalization Law, she was instead given an appointment still as PHO II but under a co-terminous status at the Center for Health and Development, DOH, which position she refused to accept.

The CSC initially granted Dr. Yu's protest and revoked Dr. Dayrit's appointment, but upon motion for reconsideration, reversed itself and declared that the PHO II position was never devolved to the Provincial Government of Basilan but was retained by the DOH; that the PHO II position held by Dr. Yu was a newly-created position; and that she did not have a vested right to the Chief of Hospital II position. The CA reversed the CSC, ruling that the PHO II position was devolved to the Basilan Provincial Government, relying on letters from DOH officials confirming that the item position remained with the LGU even when Dr. Castillo was retained by the DOH.

• Devolved Position: The CSC argued that the Court of Appeals erred in holding that the PHO II position previously occupied by respondent Yu is a devolved position.
• Number of Plantilla Positions: The CSC argued that only 53 plantilla positions, not 54, were devolved to the local government of Basilan, implying that the PHO II position was not among those devolved.

• Vested Right: Dr. Yu argued that she has a vested right to the position of Chief of Hospital II, which was a mere conversion from the item of Provincial Health Officer II previously occupied by her.
• Re-Nationalization: Dr. Yu argued that pursuant to the Re-Nationalization Law, she should have been automatically re-appointed to the position of PHO II of the Hospital, later to be renamed Chief of Hospital II, instead of being given an appointment under a co-terminous status which she refused to accept.

• Devolved Position: Whether the PHO II position previously occupied by Dr. Yu was a devolved position or a locally created one.
• Abandonment: Whether Dr. Castillo may be considered to have abandoned her position for consistently failing to assert her rights thereto.
• Vested Right: Whether Dr. Yu acquired a vested right to the re-classified position of Chief of Hospital II.

• Devolved Position: Yes. The PHO II position was devolved to the Provincial Government of Basilan. The devolution of personnel and positions under Section 17(i) of R.A. No. 7160 and Section 2(a)(2) of E.O. No. 503 is mandatory, as indicated by the use of the word "shall."
• Abandonment: No. Dr. Castillo did not abandon her position. Abandonment requires both an intention to abandon and an overt or external act by which the intention is carried into effect, and Governor Salapuddin's refusal to accept Dr. Castillo negates any voluntariness on her part to let go of her position.
• Vested Right: Yes. Dr. Yu was validly appointed to the position of PHO II in 1994 and consequently acquired a vested right to its re-classified designation as Chief of Hospital II. She should have been automatically re-appointed by Secretary Dayrit in accordance with the Guidelines for the Re-Nationalization of Personnel, Assets and Appropriations of Basilan Provincial Hospital.

• Devolved Position: The Court ruled that pursuant to the declared policy under R.A. No. 7160, national agencies, including the DOH, were mandated to devolve to local government units the responsibility for the provision of basic services and facilities. Section 17(i) of the same Code prescribes the manner of devolution, which includes the transfer to local government units of records, equipment, assets, and personnel of national agencies corresponding to the devolved powers, functions, and responsibilities. E.O. No. 503 laid down guidelines requiring mandatory absorption of NGA personnel by LGUs, except when not administratively viable. The use of the word "shall" in both Section 17(i) of R.A. No. 7160 and Section 2(a)(2) of E.O. No. 503 connotes a mandatory order and is inconsistent with the idea of discretion. The Court found no dearth of evidence showing that the item position of PHO II was, in fact, devolved to the Provincial Government of Basilan. Governor Salapuddin himself certified that said position was included in the 1992 OSCAS received from the DBM with its corresponding budget appropriation, and that during the formal turn over program in 1993, the item position of PHO II was among the positions turned over to the Provincial Government of Basilan. The Court rejected the CSC's argument that only 53 plantilla positions were devolved, stating that it cannot be disputed that Dr. Castillo's PHO II position was devolved. Governor Salapuddin's refusal to reappoint Dr. Castillo was whimsical, as it was not shown that absorption was not administratively viable. However, his refusal did not prevent the devolution of Dr. Castillo, which, together with that of the PHO II position, took effect by operation of law. The Court noted that Dr. Castillo's detail to the DOH was confirmed by then Secretary of Health Juan M. Flavier in Department Order No. 228, series of 1993, and that the provincial government of Basilan continued to pay her salary. The Court also noted that Dr. Castillo was later re-absorbed by the DOH as a devolution non-viable employee and paid salaries from the Miscellaneous Personnel Benefits Fund. The Court concluded that with Dr. Castillo's re-absorption by the DOH, her devolved position with the LGU of Basilan was left vacant, and Dr. Yu was validly appointed to the position of PHO II in 1994.

• Abandonment: The Court defined abandonment of an office as the voluntary relinquishment of an office by the holder with the intention of terminating his possession and control thereof, requiring two essential elements: first, an intention to abandon, and second, an overt or external act by which the intention is carried into effect. The Court ruled that Dr. Castillo's seeming lackadaisical attitude towards protecting her rights cannot be construed as abandonment, as Governor Salapuddin's tenacious refusal to accept her negates any and all voluntariness on her part to let go of her position. The Court noted that the risk of incurring the ire of a powerful politician effectively tied Dr. Castillo's hands, and it was understandable that she could not fight, even if she wanted to.

• Vested Right: The Court held that Dr. Yu was validly appointed to the position of PHO II in 1994 and consequently acquired a vested right to its re-classified designation as Chief of Hospital II. As such, Dr. Yu should have been automatically re-appointed by Secretary Dayrit in accordance with the Guidelines for the Re-Nationalization of Personnel, Assets and Appropriations of Basilan Provincial Hospital, which provide that re-nationalized personnel shall not be involuntarily separated, terminated, or laid off; shall continue to enjoy security of tenure; shall be automatically re-appointed by the Secretary immediately upon their transfer; and shall retain their pay or benefits without diminution. Considering that Dr. Yu had already retired on August 24, 2004, the Court upheld the appellate court's finding that since a re-appointment was no longer feasible due to her retirement, she should at least recover her salaries for the services she had rendered. The Court noted that Dr. Yu admitted receiving her salary as PHO II converted to Chief of Hospital for the period August to November 2001, and therefore she should receive her salary and benefits as Chief of Hospital from December 2001 up to her retirement on August 24, 2004.

• Devolution — The act by which the national government confers power and authority upon the various local government units to perform specific functions and responsibilities. Under Section 17(i) of R.A. No. 7160, devolution includes the transfer to local government units of records, equipment, assets, and personnel of national agencies corresponding to the devolved powers, functions, and responsibilities. The Court applied this doctrine in ruling that the PHO II position was mandatorily devolved to the Provincial Government of Basilan, and that Governor Salapuddin's refusal to accept Dr. Castillo did not prevent the devolution from taking effect by operation of law.

• Mandatory Absorption of NGA Personnel — Under Section 2(a)(2) of E.O. No. 503, the absorption of NGA personnel by the LGU shall be mandatory, in which case the LGUs shall create the equivalent positions of the affected personnel except when it is not administratively viable. The use of the word "shall" connotes a mandatory order and is inconsistent with the idea of discretion. The Court applied this doctrine in ruling that Governor Salapuddin was mandated to absorb the PHO II position and its incumbent, Dr. Castillo, and that his refusal to do so was whimsical.

• Abandonment of Office — Abandonment of an office is the voluntary relinquishment of an office by the holder with the intention of terminating his possession and control thereof. There are two essential elements: first, an intention to abandon, and second, an overt or external act by which the intention is carried into effect. The Court applied this doctrine in ruling that Dr. Castillo did not abandon her devolved position, as Governor Salapuddin's refusal to accept her negated any voluntariness on her part.

• Vested Right to Public Office — A government employee who is validly appointed to a position acquires a vested right to that position and to its re-classified designation upon re-nationalization. The Court applied this doctrine in ruling that Dr. Yu, having been validly appointed to the PHO II position in 1994, acquired a vested right to its re-classified designation as Chief of Hospital II, and should have been automatically re-appointed by Secretary Dayrit.

• "The only instance that the LGU concerned may choose not to absorb the NGA personnel is when absorption is not administratively viable, meaning, it would result to duplication of functions, in which case, the NGA personnel shall be retained by the national government. However, in the absence of the recognized exception, devolved permanent personnel shall be automatically reappointed Section 2(a)(12) by the local chief executive concerned immediately upon their transfer which shall not go beyond June 30, 1992." — This passage articulates the mandatory nature of the absorption of devolved personnel and the limited exception to the rule, which is central to the Court's ruling that the PHO II position was devolved.

• "Be that as it may, Governor Salapuddin's refusal did not prevent the devolution of Dr.Castillo which, together with that of the PHO II position, took effect by operation of law." — This passage states the Court's conclusion that the devolution of personnel and positions takes effect by operation of law regardless of the local chief executive's refusal to accept the incumbent.

• "Abandonment of an office is the voluntary relinquishment of an office by the holder with the intention of terminating his possession and control thereof. In order to constitute abandonment of office, it must be total and under such circumstance as clearly to indicate an absolute relinquishment. There must be a complete abandonment of duties of such continuance that the law will infer a relinquishment. Abandonment of duties is a voluntary act; it springs from and is accompanied by deliberation and freedom of choice. There are, therefore, two essential elements of abandonment: first, an intention to abandon and, second, an overt or 'external' act by which the intention is carried into effect." — This passage defines the doctrine of abandonment of office, which the Court applied in ruling that Dr. Castillo did not abandon her devolved position.

• "Thus, we hold that Dr. Yu was validly appointed to the position of PHO II in 1994 and, consequently, acquired a vested right to its re-classified designation – Chief of Hospital II. As such, Dr. Yu should have been automatically re-appointed by Secretary Dayrit in accordance with the Guidelines for the Re-Nationalization of Personnel, Assets and Appropriations of Basilan Provincial Hospital." — This passage states the Court's core holding that Dr. Yu acquired a vested right to the re-classified position of Chief of Hospital II and should have been automatically re-appointed.

• Alternative Center for Organizational Reforms and Development, Inc., et al. vs. Hon. Ronaldo Zamora, G.R. No. 144256, June 8, 2005, 459 SCRA 578 — Cited for the proposition that the use of the word "shall" in a statute denotes an imperative obligation and is inconsistent with the idea of discretion, supporting the Court's ruling that the devolution of personnel was mandatory.

• Canonizado vs. Aguirre, G.R. No. 133132, February 15, 2001, 351 SCRA 659 — Cited for the definition of abandonment of office and its two essential elements, which the Court applied in ruling that Dr. Castillo did not abandon her devolved position.

• Republic of the Philippines, represented by the Civil Service Commission vs. Minerva M.P. Pacheo, G.R. No. 178021, January 25, 2012 — Cited for the definition and governance of a detail under Executive Order 292, Book V, Title 1, Subtitle A, Chapter 5, Section 26(6), which the Court applied in analyzing Dr. Castillo's detail to the DOH Regional Office.

• Section 17(i), R.A. No. 7160 (The Local Government Code of 1991) — Prescribes the manner of devolution, including the transfer to local government units of records, equipment, assets, and personnel of national agencies corresponding to the devolved powers, functions, and responsibilities. The Court applied this provision in ruling that the PHO II position was mandatorily devolved to the Provincial Government of Basilan.

• Section 2(a)(2), E.O. No. 503 — Provides that the absorption of NGA personnel by the LGU shall be mandatory, in which case the LGUs shall create the equivalent positions of the affected personnel except when it is not administratively viable. The Court applied this provision in ruling that Governor Salapuddin was mandated to absorb the PHO II position and its incumbent.

• Section 2(a)(12), E.O. No. 503 — Provides that devolved permanent personnel shall be automatically reappointed by the local chief executive concerned immediately upon their transfer, which shall not go beyond June 30, 1992. The Court applied this provision in ruling that the devolution of Dr. Castillo and the PHO II position took effect by operation of law.

• Section 26(6), E.O. 292, Book V, Title 1, Subtitle A, Chapter 5 — Defines a detail as the movement of an employee from one agency to another without the issuance of an appointment, allowed only for a limited period in the case of employees occupying professional, technical, and scientific positions. The Court applied this provision in analyzing Dr. Castillo's detail to the DOH Regional Office.

• Section 33, R.A. No. 7645 (General Appropriations Act of 1993) — Provides that officials and employees on detail with other offices shall be paid their salaries, emoluments, allowances, fringe benefits, and other personal services costs from the appropriations of their parent agencies. The Court applied this provision in ruling that the drawing of Dr. Castillo's salary from the LGU of Basilan was a necessary consequence of her devolution and subsequent detail to the DOH.

• Item III, Guidelines for the Re-Nationalization of Personnel, Assets and Appropriations of Basilan Provincial Hospital — Provides that re-nationalized personnel shall not be involuntarily separated, terminated, or laid off; shall continue to enjoy security of tenure; shall be automatically re-appointed by the Secretary immediately upon their transfer; and shall retain their pay or benefits without diminution. The Court applied these guidelines in ruling that Dr. Yu should have been automatically re-appointed by Secretary Dayrit.

Antonio T. Carpio, Presbitero J. Velasco, Jr., Teresita J. Leonardo-De Castro, Arturo D. Brion, Diosdado M. Peralta, Lucas P. Bersamin, Mariano C. Del Castillo, Roberto A. Abad, Martin S. Villarama, Jr., Jose Portugal Perez, Jose Catral Mendoza (on leave), Maria Lourdes P.A. Sereno, Bienvenido L. Reyes.

Justice Teresita J. Leonardo-De Castro filed a separate concurring opinion, fully concurring with the factual and legal basis of the ponencia except with respect to the opinion that Dr. Castillo did not abandon the devolved PHO II position. She maintained the contrary view that Dr. Castillo did indeed abandon her statutory right to the said position by acquiescence, which resulted in a vacancy to which Dr. Yu could be validly appointed.