Republic vs. Rambuyong

A lawyer-member of the sanggunian is prohibited from appearing as counsel in a civil case where a government-owned or controlled corporation is the adverse party, such corporation being an instrumentality of the government within Section 90(b)(1) of the Local Government Code as defined by Section 2 of the Administrative Code of 1987. The prohibition was applied to disqualify the incumbent Vice-Mayor from continuing as counsel against the National Power Corporation.

The National Power Corporation is a government-owned or controlled corporation charged with power development and transmission. Atty. Richard B. Rambuyong was the incumbent Vice-Mayor of the Municipality of Ipil, Zamboanga Sibugay, and by law the presiding officer of the sangguniang bayan. Section 90(b)(1) of Republic Act No. 7160 prohibits lawyer-sanggunian members from appearing as counsel in civil cases where a local government unit or any office, agency, or instrumentality of the government is the adverse party, while Section 2 of the Administrative Code of 1987 defines agency and instrumentality.

Alfredo Y. Chu filed a case for collection of a sum of money and/or damages against the National Power Corporation, docketed as Civil Case No. 1-197 and raffled to the Regional Trial Court of Ipil, Zamboanga Sibugay, Branch 24. Appearing as Chu's counsel was Atty. Richard B. Rambuyong, then the incumbent Vice-Mayor of Ipil, Zamboanga Sibugay.

Thereafter, the National Power Corporation filed a Motion for Inhibition of Atty. Rambuyong. It invoked Section 90(b)(1) of Republic Act No. 7160, which bars sanggunian members from appearing as counsel before any court where any office, agency, or instrumentality of the government is the adverse party, contending that as a government-owned or controlled corporation it fell within the term instrumentality.

The trial court denied the motion in its Order dated January 4, 2002. It reasoned that government-owned or controlled corporations were expressly excluded from Section 90(b)(1), noting that other provisions of the Local Government Code explicitly add the phrase including government-owned or controlled corporations when such inclusion is intended. To treat such corporations as covered by agency and instrumentality, in its view, would substitute presumption and conjecture for apparent legislative intent. The motion for reconsideration was likewise denied.

The National Power Corporation then filed a petition for certiorari with the Court of Appeals, alleging grave abuse of discretion in the trial judge's restrictive reading of the statutory prohibition. On May 20, 2004, the appellate court dismissed the petition, finding no capricious, arbitrary, or whimsical exercise of power nor motivation by passion or personal hostility, and characterizing any erroneous interpretation as mere error of judgment. Reconsideration was denied, prompting the petition before the Supreme Court.

• Prohibition Under Section 90(b)(1): Petitioner argued that the trial court refused to apply Section 90(b)(1) of RA 7160, which clearly bars lawyer-sanggunian members from appearing where the adverse party is a local government unit, office, agency, or instrumentality, and that courts are not authorized to distinguish where the law makes no distinction.
• In Pari Materia Construction: Petitioner maintained that the 1987 Administrative Code and the Local Government Code are in pari materia in defining office, agency, or instrumentality, and that the RTC acted beyond jurisdiction in constricting instrumentality to exclude government-owned or controlled corporations.
• NPC as Instrumentality: Petitioner argued that NPC is an instrumentality of government and that no cogent reason exists to exclude government-owned or controlled corporations from Section 90(b)(1) of RA 7160.
• Purpose of Prohibition: Petitioner contended that the prohibition intends to prevent public officials from representing interests adverse to the government.
• Prevailing Jurisprudence and Real Party in Interest: Petitioner argued that the Bacani case is no longer prevailing jurisprudence on the meaning of government instrumentalities, and that Atty. Rambuyong is the real party in interest because the challenge is directed against his appearance alone, not his client's right to prosecute the claim.

• Real Party in Interest: Respondent countered that the party benefited or injured by compulsory inhibition of plaintiff's counsel is the plaintiff in Civil Case No. 1-197, so the plaintiff is the real party in interest and his inclusion as respondent is erroneous.

• Instrumentality Status: Whether NPC, as a government-owned or controlled corporation, is an instrumentality of the government within Section 90(b)(1) of RA 7160 such that Atty. Rambuyong, as sanggunian member, may not appear as counsel against it.
• Grave Abuse of Discretion: Whether the RTC committed grave abuse of discretion in holding that government-owned or controlled corporations are excluded from the term instrumentality of the government.
• Real Party in Interest: Whether Atty. Rambuyong is the proper real party in interest in the challenge to his appearance as counsel.

• Instrumentality Status: Yes. NPC is an instrumentality of the government because Section 2 of the Administrative Code of 1987 expressly includes government-owned or controlled corporations within instrumentality.
• Grave Abuse of Discretion: Yes. The strained contrary interpretation of clearly worded provisions that should merely be applied constitutes grave abuse of discretion equivalent to lack of jurisdiction.
• Real Party in Interest: Yes in effect. The disqualification was directed against Atty. Rambuyong personally, and he was disqualified from appearing in Civil Case No. 1-197.

• Instrumentality Status: Section 2(4) and (10) of the Administrative Code of 1987 categorically provides that agency of the government includes government-owned or controlled corporations and that instrumentality includes regulatory agencies, chartered institutions, and government-owned or controlled corporations. Because the language is clear and unambiguous, no construction is permitted and the law must simply be applied. It being undisputed that NPC is a government-owned or controlled corporation, it is clearly an instrumentality. This reading was reinforced by Maceda vs. Macaraig, Jr., which described NPC as a government instrumentality, and by Section 446 of the Local Government Code making the municipal vice-mayor the presiding officer of the sangguniang bayan and thus a sanggunian member covered by Section 90(b)(1).
• Grave Abuse of Discretion: Grave abuse denotes capricious and whimsical exercise of judgment equivalent to lack of jurisdiction, or evasion of positive duty and virtual refusal to perform a duty enjoined by law. Going to extraordinary lengths to interpret legislative intent contrary to categorical statutory words, instead of merely applying them, bears the earmark of despotism. The RTC's reliance on the absence of the explicit phrase including government-owned or controlled corporations in Section 90(b)(1), despite the controlling Administrative Code definition, was therefore not mere error of judgment correctible by appeal but grave abuse warranting certiorari.
• Real Party in Interest: The government's challenge was directed against Rambuyong alone to the exclusion of his client, whose right to prosecute the claim as party litigant was beyond question. Accordingly, disqualification attached to counsel personally without impairing the underlying action, and relief was granted disqualifying him from appearing in Civil Case No. 1-197.

• Plain Meaning Rule in Statutory Construction — Where the words and phrases of a statute are not obscure or ambiguous, legislative meaning and intent are determined from the language employed and there is no room for construction; courts may not speculate as to probable intent apart from the words. Applied to hold that Section 2 of the Administrative Code of 1987, being clear that instrumentality includes government-owned or controlled corporations, must merely be applied to bring NPC within Section 90(b)(1) of the Local Government Code.
• Government Instrumentality Including GOCCs — Under Section 2(4) and (10) of the Administrative Code of 1987, agency of the government includes government-owned or controlled corporations, and instrumentality refers to any agency of the National Government not integrated within the department framework with special functions, corporate powers, special funds, and operational autonomy, usually through a charter, including regulatory agencies, chartered institutions, and government-owned or controlled corporations. Applied to classify NPC, an undisputed government-owned or controlled corporation, as an instrumentality of the government.
• Prohibition on Practice by Sanggunian Lawyer-Members vs. NPC — Under Section 90(b)(1) of the Local Government Code, sanggunian members who are members of the Bar shall not appear as counsel before any court in any civil case wherein a local government unit or any office, agency, or instrumentality of the government is the adverse party; the municipal vice-mayor as presiding officer of the sangguniang bayan under Section 446 is a sanggunian member covered thereby. Applied to disqualify Atty. Rambuyong, incumbent Vice-Mayor, from acting for the plaintiff against NPC.
• Grave Abuse of Discretion — Grave abuse means such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction; it is evasion of positive duty or virtual refusal to perform a duty enjoined by law, as when judgment is not based on law and evidence but on caprice, whim, and despotism. Applied to hold that strained interpretation of clearly worded provisions that should only be applied constitutes grave abuse, not mere error of judgment.

• "It is the rule in statutory construction that if the words and phrases of a statute are not obscure or ambiguous, its meaning and the intention of the legislature must be determined from the language employed, and, where there is no ambiguity in the words, there is no room for construction." — States the plain-meaning rule that foreclosed restrictive construction of instrumentality and required mere application of the Administrative Code definition.
• "[t]he NPC is a government instrumentality with the enormous task of undertaking development of hydroelectric generation of power and production of electricity from other sources, as well as the transmission of electric power on a nationwide basis, to improve the quality of life of the people pursuant to the State policy embodied in Section [9], Article II of the 1987 Constitution." — Reiterates prior characterization of NPC as a government instrumentality supporting its inclusion under Section 90(b)(1).
• "By grave abuse of discretion is meant, such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction." — Provides the canonical definition used to elevate the RTC's erroneous statutory interpretation to grave abuse.
• "Grave abuse of discretion is an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law or to act in contemplation of law as when the judgment rendered is not based on law and evidence but on caprice, whim and despotism." — Expands the grave-abuse standard to cover strained interpretation of clear statutory text.

• Aparri vs. Court of Appeals, 212 Phil. 215 (1984) — Followed as authority for the plain-meaning rule that unambiguous statutory language leaves no room for construction and must be applied as written.
• Maceda vs. Macaraig, Jr., 274 Phil. 1060 (1991) — Followed as jurisprudential confirmation that NPC is a government instrumentality with a nationwide power-development mandate.
• Banal III vs. Panganiban, G.R. No. 167474, November 15, 2005 — Followed for the definition of grave abuse of discretion as capricious and whimsical exercise of judgment equivalent to lack of jurisdiction.
• Ferrer vs. Office of the Ombudsman, G.R. No. 129036, August 6, 2008 — Followed for the formulation of grave abuse as evasion of positive duty or action based on caprice, whim, and despotism rather than law and evidence.

• Section 90(b)(1), Local Government Code — Prohibits sanggunian members who are members of the Bar from appearing as counsel in any civil case where a local government unit or any office, agency, or instrumentality of the government is the adverse party; applied to bar Rambuyong's appearance against NPC.
• Section 5(e), Local Government Code — Allows resort to customs and traditions only where no legal provision or jurisprudence applies; context for rejecting resort to construction where a controlling definition exists.
• Section 2(4) and (10), Administrative Code of 1987 — Defines agency of the government to include government-owned or controlled corporations and instrumentality to include regulatory agencies, chartered institutions, and government-owned or controlled corporations; applied as the controlling definition bringing NPC within instrumentality.
• Section 446, Local Government Code — Composes the sangguniang bayan of the municipal vice-mayor as presiding officer; applied to establish Rambuyong's status as sanggunian member subject to Section 90(b)(1).

Corona, C.J. (Chairperson), Velasco, Jr., Leonardo-de Castro, and Perez, JJ., concur.