JOSE GEUKEKO vs. HON. SALVADOR ARANETA

The contemporaneous construction of administrative rules and regulations by the executive officers charged with their execution is entitled to great respect and should ordinarily control judicial construction, unless such interpretation is clearly unreasonable or arbitrary.

The Republic of the Philippines acquired the Tambobong Estate in 1947 pursuant to Commonwealth Act No. 539. Jose Geukeko was the registered lessee of Lot No. 18, Block 20 (2,890 sqm), a portion of which he sub-leased to Elena Jacinto, et al. A dispute arose when Geukeko applied to purchase the lot, and the sub-lessees filed counter-applications for the portions they occupied.

• Bureau of Lands: Docketed as B.L. Conflict No. 41 (N) D.L.E. Conflict No. 2. On June 12, 1952, the Director of Lands rendered decision favoring Geukeko and dismissing the sub-lessees' protests.
• CFI of Rizal (Civil Cases Nos. 1826 & 1865): On August 4 and September 8, 1952, sub-lessees filed actions to annul the Director's decision without first appealing to the Secretary. On October 11, 1954, the CFI dismissed the cases for failure to exhaust administrative remedies.
• Secretary of Agriculture and Natural Resources (DANR Case No. 987): On October 23, 1954, sub-lessees filed an appeal. The Secretary required docketing fees and ordered submission of memoranda.
• CFI of Rizal (Civil Case No. 3453): Geukeko filed petition for mandamus and prohibition to restrain the Secretary from entertaining the appeal. On July 12, 1955, the CFI denied the petition.
• SC: Geukeko appealed.

• Geukeko was the registered lessee of Lot No. 18, Block 20, Tambobong Estate; sub-lessees occupied specific portions.
• June 12, 1952: Director of Lands recognized Geukeko as bona fide tenant and gave due course to his purchase application.
• Sub-lessees received notice of the decision (exact date unknown), but filed civil actions in the CFI on August 4 and September 8, 1952—admittedly within the 60-day appeal period.
• October 11, 1954: CFI dismissed the civil cases on the ground that plaintiffs failed to exhaust administrative remedies.
• October 23, 1954: Sub-lessees appealed to the Secretary, more than two years after the Director's decision.
• The Secretary took cognizance of the appeal based on a departmental policy that the filing of a civil action in court suspends the running of the prescriptive period for administrative appeals under Land Administrative Order No. 6.

• The appeal to the Secretary (DANR Case No. 987) was filed beyond the 60-day period prescribed by Section 2 of Land Administrative Order No. 6.
• The filing of Civil Cases Nos. 1826 and 1865 in the CFI constituted a waiver of the right to appeal to the Secretary.
• The CFI's order dismissing the civil cases was an adjudication on the merits, rendering the Director of Lands' decision final and executory.
• Consequently, the Secretary lost jurisdiction to entertain the appeal.

• The filing of the civil actions in the CFI suspended the running of the 60-day appeal period pursuant to Land Administrative Order No. 6 and the Department's established policy.
• The Director of Lands' decision had not become final because the period was tolled.
• The CFI lacked jurisdiction over the subject matter of the mandamus/prohibition action.
• The petition failed to allege facts sufficient to constitute a cause of action.

• Procedural Issue: Whether the Secretary of Agriculture and Natural Resources acted without or in excess of jurisdiction in entertaining DANR Case No. 987 (the appeal filed beyond the 60-day period).
• Substantive Issues:
  • Whether the filing of civil actions in the CFI suspends the running of the prescriptive period for administrative appeal under Section 2 of Land Administrative Order No. 6.
  • Whether the sub-lessees waived their right to administrative appeal by filing the civil cases.
  • Whether the Secretary's interpretation of his own rules regarding suspension of the appeal period is binding on the courts.

• Procedural: The SC held that the Secretary did not act without or in excess of jurisdiction. The CFI correctly dismissed Geukeko's petition for mandamus and prohibition.
• Substantive:
  • Yes, the filing of a civil action in court suspends the running of the 60-day appeal period. The Secretary's policy interpreting Land Administrative Order No. 6 to this effect is valid.
  • No, the sub-lessees did not waive their right to appeal. The records demonstrate they never intended to abandon their administrative remedies.
  • Yes, the Secretary's interpretation is binding. Under the doctrine of contemporaneous construction, an administrative agency's interpretation of its own rules—issued pursuant to delegated legislative authority—is entitled to the greatest weight and becomes part of the rule itself, unless clearly unreasonable or arbitrary. The policy is reasonable, sound, and consistent with justice and good faith.

• Contemporaneous Construction of Administrative Rules — Administrative agencies have the power to interpret their own rules which have the force and effect of law. Such interpretation is entitled to great respect and should ordinarily control judicial construction unless clearly unreasonable or arbitrary. The interpretation becomes part of the rule itself.
• Exhaustion of Administrative Remedies — As a general rule, courts will not entertain actions seeking to annul administrative decisions until the administrative hierarchy has been exhausted. The SC noted a qualification: this principle applies strictly to controversies involving the disposition of disposable public lands, not necessarily to cases involving private lands acquired by the Government by purchase (citing Marukot and Santiago), though this distinction was not decisive in the present case.
• Force and Effect of Administrative Regulations — Rules and regulations promulgated by administrative authorities pursuant to powers delegated by law have the force and effect of law.

• "An Administrative body has power to interpret its own rules which have the force and effect of law, and such an interpretation becomes part of the rule."
• "The contemporaneous construction of statute (and similarly of rules and regulations) by the executive officers of the government whose duty it is to execute it is entitled to great respect, and should ordinarily control the construction of the statute by the courts."
• "Courts are reluctant to disregard a settled practice of an executive department where they are not satisfied that it is contrary to law, and are satisfied that it is in accordance with justice and good faith."

• Miguel vs. Reyes, 93 Phil. 542 — Cited by the CFI as authority for the principle of exhaustion of administrative remedies.
• Marukot vs. Jacinto, 98 Phil. 128 — Qualified Miguel vs. Reyes; held that the exhaustion requirement applies only to controversies arising from the disposition of disposable public lands, not to private lands acquired by government purchase.
• Santiago vs. Cruz, 98 Phil. 168 — Followed Marukot in distinguishing the application of the exhaustion doctrine based on the nature of the land involved.
• Foley vs. Benedict, 122 Tex. 193 — Cited for the proposition that administrative bodies may interpret their own rules.
• Columbia Broadcasting System vs. United States — Cited for the rule that administrative regulations enacted pursuant to delegated powers have the force and effect of law.
• United States vs. Philrock, 120 U.S. 52 — Cited for the doctrine that contemporaneous construction by executive officers is entitled to great respect.

• Land Administrative Order No. 6, Section 2 — Prescribes the 60-day period for appealing decisions of the Director of Lands to the Secretary of Agriculture and Natural Resources, and provides that the period is interrupted by the filing of a motion for reconsideration.
• Revised Administrative Code, Section 79(b) — Statutory basis authorizing the Secretary to promulgate Land Administrative Order No. 6.
• Act No. 2874, Section 5 — Additional statutory basis for the Secretary's rule-making authority.
• Act No. 3038 — Additional statutory basis for the Secretary's rule-making authority.
• Commonwealth Act No. 539 — Authorized the acquisition of the Tambobong Estate by the Republic of the Philippines.