Ejera vs. Merto and Vergara

A public servant who challenges a reassignment must exhaust available administrative remedies before resorting to judicial action; non-exhaustion is fatal, results in no cause of action, and carries jurisdictional implications because reassignment is a personnel action within the exclusive jurisdiction of the Civil Service Commission.

Petitioner Marichu G. Ejera was Agricultural Center Chief I in the Office of the Provincial Agriculturist in Negros Oriental, while respondent Beau Henry L. Merto was the Provincial Agriculturist and respondent Erwin Vergara was the Provincial Legal Officer. The provincial government implemented the Barangay Agricultural Development Center Program to provide agricultural extension services to interior barangays. The dispute implicated the Administrative Code of 1987, the Omnibus Rules Implementing Book V, and the Local Government Code of 1991.

Marichu G. Ejera held the position of Agricultural Center Chief I in the Office of the Provincial Agriculturist in Negros Oriental, a position equivalent to Senior Agriculturist and next-in-rank to Supervising Agriculturist. When the Supervising Agriculturist retired, she applied for the position, but Daisy Kirit was eventually appointed. Ejera filed a protest before the CSC Regional Office in Cebu City, which dismissed it on May 24, 2000; the Central CSC Office affirmed the dismissal on July 25, 2001 under Resolution No. 011253. Meanwhile, on September 11, 2000, respondent Provincial Agriculturist Beau Henry L. Merto issued Office Order No. 008, amending Office Order No. 008, Series of 2000, on the assignment/re-assignment of BADC Area Coordinators and Development Team Members, in the interest of the service and to provide intensive agricultural extension services to residents of interior barangays under the Barangay Agricultural Development Center Program. Governor George P. Arnaiz was furnished a copy, and the order was to take effect on October 2, 2000. Ejera was one of the personnel reassigned and was designated team leader in Lake Balanan and Sandulot in Siaton.

When Ejera refused to obey the office order, Merto ordered her on March 12, 2001 to explain in writing within 72 hours why no administrative disciplinary action should be taken against her. She did not submit an explanation. Merto and respondent Atty. Erwin B. Vergara, the Provincial Legal Officer, then summoned her to a conference. Ejera and her counsel, Atty. Lenin R. Victoriano, attended but later walked out, allegedly because Vergara refused to record her objections to the questions she was being asked to answer.

On April 16, 2001, Ejera filed in the RTC a complaint for final injunction with temporary restraining order and/or preliminary injunction, and damages. She alleged that Merto issued Office Order No. 008 because he resented her attacks before the CSC Regional Office; that the reassignment was a virtual banishment because her position required her to stay in Dumaguete City; that it violated the Omnibus Rules on Appointments and Other Personnel Actions prohibiting whimsical and indiscriminate reassignments; that Merto had charged her administratively for refusing to obey; that Merto had no power to investigate because the Provincial Governor was the proper disciplining authority; that Merto's letter requiring explanation violated CSC Memorandum Circular No. 19, Series of 1999, which required complaints to be under oath; and that Merto connived with Vergara, who issued a Notice of Conference on March 30, 2001 for a preliminary conference on April 5, 2001. She further averred that the RTC could rule that the respondents had no power to banish her to far-flung areas through the illegal, whimsical, and malicious Office Order No. 008, and that they acted in bad faith and with malice in violation of Articles 19 and 20 of the Civil Code, entitling her to damages. She prayed for a temporary restraining order and/or preliminary injunction, a declaration that Office Order No. 008 was null and void, a permanent injunction, and P500,000.00 moral damages, P200,000.00 exemplary damages, P50,000.00 attorney's fees and litigation expenses, plus costs.

At the hearing on the temporary restraining order, the RTC proposed possible reconsideration of Office Order No. 008, especially because Ejera complained of ill-health. The respondents expressed willingness to consider the proposal and promised to confer with the Provincial Governor, but later manifested that, with the Governor running for re-election, they could submit an approved written proposal only after the elections. The RTC granted an extension to submit the written proposal for amicable settlement. Shortly after the elections, Ejera moved to declare the respondents in default for failing to answer. The RTC held the motion in abeyance in view of proposals and counterproposals for a compromise. Later, the respondents manifested that because a possible compromise would involve a transfer or detail of Ejera to another place, they and the Governor could not act during the campaign period from January 2, 2001 to June 13, 2001, which was covered by the Omnibus Election Code and COMELEC Resolution No. 3401. The RTC then declared the respondents in default.

Before the ex parte hearing on the merits, Ejera moved to admit a supplemental complaint to implead Gregorio P. Paltinca, Officer-in-Charge of the Office of the Provincial Agriculturist, for issuing Office Order No. 005, Series of 2001, on June 29, 2001, which amended Office Order No. 008 and reassigned her to Barangays Balanan, Sandulot, and Jumalon in Siaton as her official duty stations effective July 2, 2001. The supplemental complaint alleged that the order was not posted, that she was not furnished a copy, that Paltinca acted with malice and evident bad faith, that the reassignment was worse than the original and constituted banishment, that it violated Book V, Section 12(2) and (3) of the Administrative Code of 1987, and that she refused to obey both orders because they were null and void ab initio as far as she was concerned. Paltinca moved to dismiss on the grounds that the admission that the Governor, not he, was the appointing and disciplining authority exposed a lack of cause of action, that the Governor was a real party in interest, and that Ejera failed to exhaust administrative remedies. Ejera opposed, arguing that the Governor was neither indispensable nor necessary, that the issue was purely legal, and that the motion was premature because the supplemental complaint had not been admitted.

Vergara later informed the RTC that the CSC Central Office had dismissed Ejera's appeal under Resolution No. 011253, arguing that this removed any valid reason to disobey the office orders. Ejera responded that she had moved for reconsideration and that the CSC appeal did not affect the issue of the legality of her reassignment. The RTC dismissed the case, and the CA affirmed, finding that the office orders were issued by the heads of the Office of the Provincial Agriculturist with the Governor's approval and did not single out Ejera for transfer to the interior localities, so they could not be considered her personal banishment.

• Exhaustion of Administrative Remedies: Petitioner argued that the rule was not absolute and that her case fell under exceptions, such as a purely legal question, absence of a plain, speedy, and adequate remedy, great and irreparable damage, and violation of her security of tenure and right to due process; the legality of Office Order No. 008 and Office Order No. 005 could only be resolved by a court.
• Illegality of Reassignment: Petitioner maintained that Office Order No. 008 and Office Order No. 005 violated the Administrative Code of 1987 and the Omnibus Rules on Appointments and Other Personnel Actions because they were indiscriminate and whimsical, constituted virtual banishment from Dumaguete City, and amounted to removal without cause without her consent.
• Lack of Authority to Investigate: Petitioner argued that Merto had no power to investigate her because the Provincial Governor was the proper disciplining authority, and that Merto's letter requiring explanation violated CSC Memorandum Circular No. 19, Series of 1999 requiring complaints to be under oath.
• Waiver by Default: Petitioner argued that the respondents declared in default waived the defense of non-exhaustion of administrative remedies and never raised it; the court had no legal justification to dismiss on that ground.
• Prematurity of Motion to Dismiss: Petitioner contended that Paltinca's motion to dismiss was premature because the RTC had not yet admitted her supplemental complaint.
• Bad Faith and Damages: Petitioner averred that respondents acted in bad faith and with malice in violation of Articles 19 and 20 of the Civil Code, entitling her to moral and exemplary damages, attorney's fees, and litigation expenses.

• CA Already Passed Upon Arguments: Respondents countered in their comment that petitioner's arguments had been thoroughly discussed and passed upon by the CA and that she did not show her appeal was one the Court could take cognizance of.
• Non-Exhaustion and Lack of Cause of Action: Paltinca moved to dismiss the supplemental complaint on the grounds that petitioner's admission that the Provincial Governor, not Paltinca, was the appointing and disciplining authority exposed her lack of cause of action; that non-inclusion of the Governor as real party in interest was fatal; and that failure to exhaust administrative remedies warranted dismissal.
• Dismissal of CSC Appeal Removed Excuse: Vergara argued that the dismissal by the CSC Central Office of petitioner's appeal, CSC Resolution No. 011253, removed any valid reason or legal ground for her to disobey the office orders, which her co-employees had obeyed and which the Governor issued for the good of the service and food security.

• Exhaustion of Administrative Remedies: Whether the petitioner's case fell under an exception to the rule requiring exhaustion of administrative remedies before resort to judicial action.
• Supplemental Complaint and Motion to Dismiss: Whether the RTC could act on Paltinca's motion to dismiss before admitting the supplemental complaint.
• Effect of Default: Whether respondents declared in default could benefit from the special defense of non-exhaustion of administrative remedies raised by non-defaulting defendant Paltinca.

• Exhaustion of Administrative Remedies: No. The petitioner's non-exhaustion of administrative remedies was fatal; the reassignment was a personnel action within the CSC's grievance and exclusive jurisdiction, and the RTC and CA correctly dismissed the case.
• Supplemental Complaint and Motion to Dismiss: Yes. The RTC could resolve Paltinca's motion to dismiss before admitting the supplemental complaint because the supplemental complaint raised issues identical to the original complaint and could exist side-by-side with it.
• Effect of Default: Yes. The defaulted respondents could benefit from Paltinca's non-exhaustion defense because the complaint stated a common cause of action and Section 3, Rule 9 of the 1997 Rules required trial against all upon the answers filed.

• Exhaustion of Administrative Remedies: The petition was denied because the reassignment was a personnel action that had to pass through the CSC's grievance and administrative process before judicial intervention. Under Section 26, Chapter 5, Title I-A, Book V of the Administrative Code of 1987, personnel actions include reassignment; transfer is a movement from one position to another of equivalent rank, level, or salary without break in service involving the issuance of an appointment, while reassignment is a movement from one organizational unit to another in the same agency without reduction in rank, status, or salary. The CSC adopted this definition in Section 10, Rule VII of the Omnibus Rules and Section 6, Rule III of CSC Memorandum Circular No. 40, Series of 1998. The office orders moved Ejera from the Office of the Provincial Agriculturist in Dumaguete City to barangays in Siaton; she did not claim any reduction in rank, status, or salary, and she was one of several employees reassigned. Although she later claimed poor health as a reason for refusing reassignment, she revealed this only during trial and lost the opportunity to ventilate it when she walked out of the conference. The CSC has the power to prescribe, amend, and enforce rules and to render binding opinions and rulings on personnel and Civil Service matters; reassignment was therefore a matter for the CSC grievance procedure, not immediate judicial action. Ejera could also have challenged the wisdom and legality of Office Order No. 008 before the Provincial Governor, who had general supervision and control over provincial programs, projects, services, and activities under Section 465 of Republic Act No. 7160. The exhaustion rule rests on the principle that an administrative agency given a complete chance will decide correctly; it provides less expensive and speedier resolution, and courts will not entertain a case unless available administrative remedies have been exhausted. The exceptions did not apply because the legal issues were interlaced with factual issues—whether Merto acted out of resentment, whether the reassignment was banishment, and whether it was whimsical and indiscriminate—which the Governor could resolve. Non-exhaustion resulted in no cause of action and had jurisdictional implications: had Ejera followed the grievance procedure, her next step would have been the CSC, which has exclusive jurisdiction over disciplinary actions and personnel actions, including reassignment, as held in Corsiga vs. Judge Defensor and Mantala vs. Salvador. Thus the RTC and CA correctly dismissed the case.
• Supplemental Complaint and Motion to Dismiss: The RTC could resolve Paltinca's motion to dismiss even before admitting the supplemental complaint. The supplemental complaint assailed Office Order No. 005 and raised issues identical to those in the original complaint involving Office Order No. 008. Unlike an amended complaint, a supplemental complaint may exist side-by-side with the original because it sets forth facts supervening from the filing of the complaint, as provided in Section 6, Rule 10 of the 1997 Rules of Civil Procedure. The CA also reasoned that the procedural lapse did not prejudice Ejera's substantive rights: she intended the supplemental complaint to be admitted, she impliedly conceded its admission when she moved for resolution of the motion to dismiss and opposed it, the trial court indirectly admitted it when it dismissed the case against all defendants, and even if the motion had been denied as premature, Paltinca could raise non-exhaustion in his answer and obtain dismissal.
• Effect of Default: The defaulted respondents could benefit from Paltinca's non-exhaustion defense. There was a common cause of action against Merto, Vergara, and Paltinca, and the non-exhaustion of administrative remedies was fatal to that common cause. Under Section 3, Rule 9 of the 1997 Rules of Civil Procedure, when a pleading asserts a common cause of action against several defending parties, some of whom answer and others fail to do so, the court shall try the case against all upon the answers filed and render judgment upon the evidence presented. The answer of a non-defaulting defendant inures to the benefit of defaulted defendants who share a common fate in the action. The trial court therefore did not err in appreciating the defense of non-exhaustion raised by Paltinca in favor of Merto and Vergara.

• Exhaustion of Administrative Remedies — The doctrine requires that where an enabling statute provides a procedure for administrative review, courts will not entertain a case unless available administrative remedies have been resorted to and the appropriate authorities have been given an opportunity to act and correct errors. It is not an ironclad rule and recognizes exceptions: (a) estoppel; (b) challenged administrative act patently illegal, amounting to lack of jurisdiction; (c) unreasonable delay or official inaction that will irretrievably prejudice the complainant; (d) amount involved relatively so small as to make the rule impractical and oppressive; (e) question involved is purely legal and will ultimately have to be decided by courts; (f) judicial intervention is urgent; (g) application may cause great and irreparable damage; (h) controversial acts violate due process; (i) issue of non-exhaustion rendered moot; (j) strong public interest involved; and (l) in quo warranto proceedings. In this case, the exceptions did not apply because the challenge to the reassignment was interlaced with factual issues and the Provincial Governor and CSC were available to resolve the matter. Non-exhaustion was fatal, resulted in no cause of action, and had jurisdictional implications.
• Reassignment vs. Transfer — Under Section 26, Chapter 5, Title I-A, Book V of the Administrative Code of 1987, transfer is a movement from one position to another of equivalent rank, level, or salary without break in service involving the issuance of an appointment; reassignment is a movement from one organizational unit to another in the same agency without reduction in rank, status, or salary. The CSC adopted this definition in Section 10, Rule VII of the Omnibus Rules and Section 6, Rule III of CSC Memorandum Circular No. 40, Series of 1998. Reassignment without the employee's consent is allowed only for a maximum period of one year; it is presumed regular and in the interest of public service unless proven otherwise or unless it constitutes constructive dismissal. No reassignment shall be undertaken if done indiscriminately or whimsically, and reassignment of small salaried employees is not permissible if it causes significant financial dislocation. Sufficient reasons for continued reassignment and performance of functions other than those attached to the position must be established. The office orders in this case were reassignments, not transfers, and Ejera did not show a reduction in rank, status, or salary or a timely valid personal reason to refuse.
• Constructive Dismissal — Constructive dismissal exists when an employee quits work because of the agency head's unreasonable, humiliating, or demeaning actuations which render continued work impossible; the employee is deemed illegally dismissed. It may occur even without diminution or reduction of salary and may involve a transfer from a position of dignity to a more servile or menial job. The Court cited this rule in defining reassignment but did not find constructive dismissal on the facts.
• Exclusive Jurisdiction of the Civil Service Commission over Personnel Actions — Cases involving personnel actions, reassignment included, affecting civil service employees are within the exclusive jurisdiction of the CSC. The trial court does not have jurisdiction over such personnel actions. The proper route is to question the action before the agency head or appropriate administrative authority and then the CSC, whose decisions may be elevated to the Court of Appeals. In this case, the RTC should have dismissed the case and let Ejera pursue her grievance before the Provincial Governor and the CSC.
• Effect of Partial Default and Common Cause of Action — Under Section 3, Rule 9 of the 1997 Rules of Civil Procedure, when a pleading asserting a claim states a common cause of action against several defending parties, some of whom answer and others fail to do so, the court shall try the case against all upon the answers filed and render judgment upon the evidence presented. The answer of a non-defaulting defendant inures to the benefit of the defaulted defendants because they share a common fate in the action. Applied here, Paltinca's defense of non-exhaustion benefited Merto and Vergara despite their default.
• Supplemental Pleadings — Under Section 6, Rule 10 of the 1997 Rules of Civil Procedure, a supplemental pleading sets forth transactions, occurrences, or events that have happened since the date of the pleading sought to be supplemented. Unlike an amended complaint, a supplemental complaint may exist side-by-side with the original complaint. In this case, the supplemental complaint regarding Office Order No. 005 raised issues identical to the original complaint, so the RTC could resolve Paltinca's motion to dismiss before admitting it.
• Judicial Non-Interference in Administrative Policy Matters — The doctrine of exhaustion is a judicial recognition that certain matters are peculiarly within the competence of the administrative agency. It operates as a shield that prevents the overarching use of judicial power and hinders courts from intervening in matters of policy infused with administrative character. The office orders concerned the implementation of a provincial executive policy, so the judiciary should not have intervened before the administrative process was exhausted.

• "A public servant who has an issue against a directive for her reassignment must exhaust her available administrative remedies before resorting to judicial action. The non-exhaustion of available administrative remedies is fatal to the resort to judicial action." — This opening statement states the ratio decidendi of the case and the Court's controlling rule on reassignment disputes.
• "The doctrine of exhaustion of administrative remedies is a cornerstone of our judicial system. The thrust of the rule is that courts must allow administrative agencies to carry out their functions and discharge their responsibilities within the specialized areas of their respective competence. The rationale for this doctrine is obvious. It entails lesser expenses and provides for the speedier resolution of controversies. Comity and convenience also impel courts of justice to shy away from a dispute until the system of administrative redress has been completed." — Quoted from Universal Robina Corp. (Corn Division) vs. Laguna Lake Development Authority, this passage defines the rationale and policy behind the exhaustion doctrine.
• "The doctrine of exhaustion of administrative remedies is a judicial recognition of certain matters that are peculiarly within the competence of the administrative agency to address. It operates as a shield that prevents the overarching use of judicial power and thus hinders courts from intervening in matters of policy infused with administrative character." — Quoted from Dimson (Manila), Inc. vs. Local Water Utilities Administration, this passage explains why courts must refrain from intervening in administrative policy matters.
• "Under this set up, the trial court does not have jurisdiction over personnel actions and, thus, committed an error in taking jurisdiction over Civil Case No. 22462." — Quoted from Corsiga vs. Judge Defensor, this passage supplies the jurisdictional consequence of non-exhaustion in personnel actions.

• Universal Robina Corp. (Corn Division) vs. Laguna Lake Development Authority, G.R. No. 191427, May 30, 2011, 649 SCRA 506, 511 — Quoted as the Court's canonical statement of the exhaustion of administrative remedies doctrine and its rationale.
• Dimson (Manila), Inc. vs. Local Water Utilities Administration, G.R. No. 168656, September 22, 2010, 631 SCRA 59, 72 — Quoted for the principle that courts should not intervene in matters of policy infused with administrative character.
• Corsiga vs. Judge Defensor, G.R. No. 139302, October 28, 2002, 391 SCRA 267, 272-273 — Held that the trial court does not have jurisdiction over personnel actions and that the proper route is appeal to the agency head and then the CSC.
• Mantala vs. Salvador, G.R. No. 101646, February 13, 1992, 206 SCRA 264 — Cited for the rule that cases involving personnel actions, reassignment included, affecting civil service employees are within the exclusive jurisdiction of the CSC.
• Union Bank of the Philippines vs. Court of Appeals, G.R. No. 131729, May 19, 1998, 290 SCRA 198, 219-220 — Cited for the rationale that administrative agencies should be given the opportunity to correct errors and that administrative processes provide less expensive and speedier solutions.
• Vigilar vs. Aquino, G.R. No. 180388, January 18, 2011, 639 SCRA 772, 777, and Republic vs. Lacap, G.R. No. 158253, March 2, 2007, 517 SCRA 255, 265-266 — Cited for the list of exceptions to the exhaustion of administrative remedies.
• Sison vs. Tablang, G.R. No. 177011, June 5, 2009, 588 SCRA 727, 733 — Cited for the rule that non-observance of the exhaustion doctrine results in the complaint having no cause of action.
• Shoemart, Inc. vs. Court of Appeals, G.R. No. 86956, October 1, 1990, 190 SCRA 189, 196 — Cited for the rule that a supplemental complaint may exist side-by-side with the original complaint.

• Section 26, Chapter 5, Title I-A, Book V, Administrative Code of 1987 — Lists personnel actions and defines transfer and reassignment. The Court used it to classify the office orders as reassignment, not transfer.
• Section 10, Rule VII, Omnibus Rules Implementing Book V, Administrative Code of 1987 — Defines reassignment as the movement of an employee from one organizational unit to another in the same department or agency without reduction in rank, status, or salary and without issuance of an appointment. The Court applied this definition to the office orders.
• Section 6, Rule III, CSC Memorandum Circular No. 40, Series of 1998 (Revised Omnibus Rules on Appointments and Other Personnel Actions) — Provides that reassignment does not require an appointment but requires an office order; without consent it is allowed only for a maximum of one year; it is presumed regular and in the interest of public service unless proven otherwise or unless it constitutes constructive dismissal; no reassignment shall be done indiscriminately or whimsically; and sufficient reasons for continued reassignment must be established. The Court cited these rules in evaluating the reassignment.
• Section 12, Book V, Title I-A, Chapter 3, Administrative Code of 1987 — Grants the CSC the power to prescribe, amend, and enforce rules and regulations for the Civil Service Law and to render opinions and rulings on personnel and Civil Service matters. The Court used this to require resort to the CSC grievance procedure.
• Section 465, Republic Act No. 7160 (Local Government Code) — Vests the provincial governor with general supervision and control over all programs, projects, services, and activities of the provincial government. The Court cited it to show that the Provincial Governor could competently resolve the petitioner's grievance over the reassignment.
• Section 16, Republic Act No. 7160 — States the general welfare clause for local government units. It was cited in relation to the Governor's powers and the provincial policy behind the office orders.
• Section 3, Rule 9, 1997 Rules of Civil Procedure — Governs default and the effect of partial default. The Court applied it to allow the answer of non-defaulting defendant Paltinca to benefit the defaulted respondents.
• Section 6, Rule 10, 1997 Rules of Civil Procedure — Governs supplemental pleadings. The Court applied it to hold that the supplemental complaint could exist side-by-side with the original and that the RTC could resolve Paltinca's motion to dismiss before admitting it.
• Section 13, Rule VII, Rules Implementing Book V, Executive Order No. 292 — Provides how appeal may be taken from a decision of a department or agency head to the Merit System Protection Board, now the CSC En Banc. The Court quoted it in Corsiga vs. Judge Defensor to describe the administrative appeal route.
• Section 8(B)(2), Rule 2, Revised Rules on Administrative Cases in the Civil Service (CSC Resolution No. 1101502) — Provides that the CSC Regional Office shall take cognizance of decisions of heads of agencies relative to protests and other personnel actions on appeal. The Court cited it in a footnote on the administrative route.

Maria Lourdes P.A. Sereno (Chief Justice), Teresita J. Leonardo de Castro, Martin S. Villarama, Jr., and Bienvenido L. Reyes concurred. No separate concurring opinions are summarized in the text.