Municipality of Jimenez vs. Baz

A municipality created by executive order prior to the Pelaez ruling attains de jure status and its existence can no longer be questioned where the State has subsequently recognized its corporate existence through various official acts, and any defect in its creation is cured by the retroactive application of Section 442(d) of the Local Government Code of 1991.

The Municipality of Sinacaban was created in 1949 by Executive Order No. 258 of President Elpidio Quirino, which detached its territory from the Municipality of Jimenez in Misamis Occidental. In 1988, Sinacaban filed a territorial claim with the Provincial Board against Jimenez for several barrios, relying on the technical description in its creating executive order. Jimenez opposed the claim, invoking a 1950 boundary agreement with Sinacaban that had been approved by the Provincial Board. The Provincial Board ruled in favor of Sinacaban, declaring the 1950 agreement void as it contravened the executive order. Jimenez then filed a petition for certiorari, prohibition, and mandamus in the Regional Trial Court (RTC), challenging the very legal existence of Sinacaban based on the Supreme Court's 1965 ruling in Pelaez v. Auditor General, which held that the creation of municipal corporations is a legislative function.

• Creation and Claim: The Municipality of Sinacaban was created by Executive Order No. 258 (1949), which described its territory as the southern portion of Jimenez. In 1988, Sinacaban filed a territorial claim with the Provincial Board against Jimenez for several barrios, based on the technical description in E.O. No. 258.
• Jimenez's Defense: Jimenez opposed the claim by invoking a 1950 agreement between the municipalities, approved by Provincial Board Resolution No. 77, which purported to fix a different common boundary, placing the disputed barrios under Jimenez.
• Provincial Board Ruling: The Provincial Board ruled for Sinacaban, declaring that it had no power to alter the boundaries fixed in E.O. No. 258, as that power belonged to Congress.
• RTC Proceedings: Jimenez filed a special civil action in the RTC, challenging Sinacaban's legal existence based on Pelaez v. Auditor General. The RTC upheld Sinacaban as a de facto corporation, estopped Jimenez from questioning its existence, and cited Section 442(d) of R.A. No. 7160 as a curative provision. It ordered a relocation survey based on E.O. No. 258's metes and bounds.
• Supreme Court Review: Jimenez elevated the case, questioning Sinacaban's legal personality and the applicable boundary description.

• Legal Personality: Petitioner argued that Sinacaban was not a legal juridical entity because it was created by executive order, contrary to the Pelaez doctrine that municipality creation is a legislative power.
• Curative Statute Invalid: Petitioner contended that Section 442(d) of R.A. No. 7160 is unconstitutional and invalid as it does not comply with the plebiscite requirement for the creation of municipalities under the Constitution and the Local Government Code.
• Applicable Boundary: Petitioner maintained that the 1950 agreement embodied in Provincial Board Resolution No. 77, not the technical description in E.O. No. 258, should govern the boundary, as it had been recognized for decades.

• De Facto Status and Estoppel: Respondents countered that Sinacaban had been a de facto corporation for over 40 years, its existence had been recognized by the State and by Jimenez itself through the 1950 agreement, and Jimenez was thus estopped from questioning it.
• Curative Legislation: Respondents argued that Section 442(d) of the Local Government Code of 1991 cured any defect in Sinacaban's creation, granting it de jure status.
• Boundary Definition: Respondents argued that the Provincial Board lacked the power to alter the boundaries fixed by the creating executive order; its authority was merely administrative and could not amend the law.

• Legal Existence: Whether the Municipality of Sinacaban has a valid legal existence, notwithstanding its creation by executive order.
• Plebiscite Requirement: Whether the curative provision of Section 442(d) of R.A. No. 7160 is invalid for failure to comply with the constitutional plebiscite requirement.
• Boundary Determination: Whether the boundary between Sinacaban and Jimenez should be based on the technical description in E.O. No. 258 or on the 1950 Provincial Board Resolution approving a different agreement.

• Legal Existence: Sinacaban possesses legal existence. Although created by executive order contrary to the Pelaez doctrine, its de facto status was established by decades of uninterrupted official recognition (e.g., inclusion in a municipal circuit court and a legislative district) and the failure to challenge its existence within the prescriptive period for quo warranto. Any remaining defect was cured by Section 442(d) of R.A. No. 7160, which retroactively validated municipalities existing at its effectivity.
• Plebiscite Requirement: The curative statute is valid. The plebiscite requirement under the 1973 and 1987 Constitutions applies only to the new creation of municipalities. Since Sinacaban had already attained de facto status before these constitutions took effect, it was not subject to the plebiscite requirement for validation.
• Boundary Determination: The boundary must be determined by the technical description in E.O. No. 258. The Provincial Board's power to settle boundary disputes under the Revised Administrative Code was administrative in nature, intended to implement, not amend, the law creating the municipality. Resolution No. 77, if contrary to E.O. No. 258, was void and could not be the basis for adjudicating the territorial dispute. The RTC correctly ordered a relocation survey based on the executive order's metes and bounds.

• De Facto Municipal Corporation Doctrine — A municipal corporation created by executive order (later found to be invalid under the Pelaez doctrine) may attain de facto status if its corporate existence has been recognized and acquiesced to publicly and officially for a long period. Factors include: (1) long passage of time without challenge; (2) no quo warranto suit filed after the Pelaez ruling; and (3) subsequent official recognition (e.g., classification as a municipality, inclusion in judicial circuits and legislative districts).
• Curative Statute Doctrine — The legislature has the power to enact curative statutes that retroactively validate defects in the creation of local government units. Section 442(d) of the Local Government Code of 1991 is such a statute, curing any irregularity in the creation of municipalities existing at its effectivity.
• Administrative vs. Legislative Power over Boundaries — Provincial boards, in settling boundary disputes, exercise administrative power to implement and carry into effect the law creating a municipality. They cannot, through a compromise agreement, alter or amend the boundaries fixed by the legislative act (or executive order, in this case) that created the municipality.

• "The power of provincial boards to settle boundary disputes is 'of an administrative nature — involving, as it does, the adoption of means and ways to carry into effect the law creating said municipalities.' It is a power 'to fix common boundary, in order to avoid or settle conflicts of jurisdiction between adjoining municipalities.' It is thus limited to implementing the law creating a municipality. It is obvious that any alteration of boundaries that is not in accordance with the law creating a municipality is not the carrying into effect of that law but its amendment."
• "Since, as previously explained, Sinacaban had attained de facto status at the time the 1987 Constitution took effect on February 2, 1987, it is not subject to the plebiscite requirement. This requirement applies only to new municipalities created for the first time under the Constitution."

• Pelaez v. Auditor General, 122 Phil. 965 (1965) — Controlling precedent cited by petitioner; established that the power to create municipal corporations is legislative and cannot be exercised by the President by executive order. The Court distinguished the present case by applying the de facto corporation and curative statute doctrines.
• Municipality of San Narciso, Quezon v. Mendez, Sr., 239 SCRA 11 (1994) — Applied by the Court as directly analogous. This case established the factors for validating the creation of a municipality by executive order and held that Section 442(d) of R.A. No. 7160 cured any defect.
• Municipality of Sogod v. Rosal, 201 SCRA 232 (1991) — Cited for the principle that a provincial board cannot, through a compromise agreement, alter the boundaries fixed by the statute creating a municipality.

• Section 68, Revised Administrative Code of 1917 — The statutory basis cited in E.O. No. 258 for the creation of the Municipality of Sinacaban.
• Section 2167, Revised Administrative Code of 1917 — Provided the authority and procedure for provincial boards to settle municipal boundary disputes. Interpreted as conferring administrative, not legislative, power.
• Section 442(d), Local Government Code of 1991 (R.A. No. 7160) — The curative provision stating that municipalities existing at the Code's effectivity, including those organized by executive order with sitting officials, "shall henceforth be considered as regular municipalities." Applied to validate Sinacaban's existence.
• Article X, Section 10, 1987 Constitution & Section 10, R.A. No. 7160 — Establish the plebiscite requirement for the creation, division, merger, abolition, or substantial alteration of boundaries of local government units. Held inapplicable to the validation of a pre-existing de facto municipality.

Narvasa, C.J., Padilla, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Puno, Vitug, Kapunan, Francisco, Hermosisima, Jr., Panganiban and Torres, Jr., JJ., concur.

N/A — The decision was unanimous.