Review Center Association of the Philippines vs. Ermita

An executive order that expands the jurisdiction of an administrative agency beyond the coverage defined by its enabling statute constitutes an unconstitutional usurpation of legislative power.

A leakage in the June 2006 Nursing Board Examinations, traced to two members of the Board of Nursing and certain review centers, prompted executive intervention. President Gloria Macapagal-Arroyo replaced the members of the Professional Regulation Commission’s Board of Nursing and ordered examinees to retake the examinations. On 8 September 2006, President Arroyo issued Executive Order No. 566, directing CHED to formulate a regulatory framework for review centers and similar entities. CHED subsequently issued implementing rules requiring independent review centers to tie-up or integrate with higher education institutions (HEIs) or face closure for operating illegally.

• Nursing Board Examination Leakage: In June 2006, the Professional Regulation Commission (PRC) conducted the Nursing Board Examinations. Licensure applicants reported that handwritten copies of Tests III and V were circulated among examinees reviewing at the R.A. Gapuz Review Center and Inress Review Center. The PRC admitted the leakage and traced it to two members of the Board of Nursing.
• Executive Response: President Gloria Macapagal-Arroyo replaced all members of the PRC’s Board of Nursing and ordered examinees to retake the examinations. On 8 September 2006, President Arroyo issued Executive Order No. 566, directing CHED to regulate the establishment and operation of review centers and similar entities.
• CHED Implementing Rules: CHED issued Memorandum Order No. 49 (IRR) and later Memorandum Order No. 30 (RIRR). The RIRR mandated that only CHED-recognized higher education institutions (HEIs) or consortia of HEIs and professional associations could establish review centers. Existing independent review centers were given a grace period to tie-up or integrate with HEIs, convert into schools, or be deemed illegally operating.
• Administrative Efforts: The Review Center Association of the Philippines (petitioner) requested CHED to amend or withdraw the IRR, arguing the rules would abolish independent review centers. CHED Chairman Romulo L. Neri refused to exclude independent review centers, stating it would contradict EO 566, and referred the request to the Office of the President.
• Judicial Resort: Petitioner filed a petition for prohibition and mandamus directly with the Supreme Court. PIMSAT Colleges intervened in support of respondents, while several independent CPA review centers intervened in support of petitioners. Pending resolution, the Court required the parties to observe the status quo prevailing before the issuances.

• Unconstitutional Expansion of Jurisdiction: Petitioner argued that EO 566 unconstitutionally expands CHED's coverage under Republic Act No. 7722, which limits CHED's jurisdiction to institutions of higher education and degree-granting programs, thereby excluding non-degree granting review centers.
• Usurpation of Legislative Power: Petitioner maintained that the President usurped Congress's legislative power by amending RA 7722 through an executive order without enabling legislation.
• Invalid Exercise of Rule-Making Power: Petitioner asserted that the RIRR is an invalid exercise of quasi-legislative power because it implements an unconstitutional executive order and regulates entities outside CHED's jurisdiction.

• Judicial Hierarchy: Respondent argued that the petition should be dismissed for violating the rule on judicial hierarchy, as petitioner filed directly with the Supreme Court instead of the lower courts.
• Technical Defects: Respondent contended that the petition should be dismissed due to defects in verification and certification against non-forum shopping, and for violation of the 2004 Rules on Notarial Practice.
• Broad Statutory Interpretation: Respondent argued that Sections 8(e) and (n) of RA 7722 grant CHED the power to monitor "programs of higher learning" and promulgate rules to carry out the Act, which are broad enough to include review centers.
• Executive and Police Power: Respondent maintained that the President acted within her executive power to ensure laws are faithfully executed and her residual powers under the Administrative Code. Regulation was also justified as an exercise of police power to protect public welfare following the examination leakage.

• Constitutionality of EO 566: Whether Executive Order No. 566 constitutes an unconstitutional exercise of legislative power by expanding CHED’s jurisdiction beyond Republic Act No. 7722.
• Validity of the RIRR: Whether the Revised Implementing Rules and Regulations is an invalid exercise of the Executive’s rule-making power.

• Constitutionality of EO 566: EO 566 was declared unconstitutional for usurping legislative power. RA 7722 limits CHED's coverage to institutions of higher education and degree-granting programs. Applying the verba legis rule, "higher education" refers to tertiary education granting a degree. Review centers offer non-degree instructional programs intended merely to refresh knowledge; they are not institutions of higher learning. EO 566 expanded CHED's statutory jurisdiction, an act requiring legislative amendment. The President's residual powers under the Administrative Code require that the power be "provided for under the law," and no law grants the President authority to amend RA 7722. Furthermore, RA 8981 does not grant the PRC the power to regulate review centers; its mandate to safeguard examination integrity pertains solely to the conduct of the examinations.
• Validity of the RIRR: The RIRR was declared invalid. Administrative agencies may only exercise quasi-legislative power within the confines of their jurisdiction. Because EO 566 is void, the RIRR, which covers entities outside CHED's jurisdiction, is an invalid exercise of rule-making power.

• Separation of Powers / Usurpation of Legislative Power — Legislative power is vested exclusively in Congress; the President cannot amend or expand statutory grants of jurisdiction to administrative agencies through executive orders without enabling legislation. An executive order that expands an agency's coverage beyond its enabling law is void for usurping legislative power.
• Verba Legis Rule of Statutory Construction — If a statute is clear, plain, and free from ambiguity, it must be given its literal meaning and applied without interpretation. "Higher education" must be read in its ordinary sense as tertiary education granting a degree.
• Potestas Delegata Non Delegare Potest — Delegated power cannot be further delegated. (Applied in Justice Brion's concurrence to invalidate the transfer of regulatory power from the PRC to CHED).

• "The President has no inherent or delegated legislative power to amend the functions of the CHED under RA 7722. Legislative power is the authority to make laws and to alter or repeal them, and this power is vested with the Congress of the Philippines which shall consist of a Senate and a House of Representatives, except to the extent reserved to the people by the provision on initiative and referendum."
• "A review center is not an institution of higher learning as contemplated by RA 7722. It does not offer a degree-granting program that would put it under the jurisdiction of the CHED. A review course is only intended to 'refresh and enhance the knowledge or competencies and skills of reviewees.'"
• "Since EO 566 is an invalid exercise of legislative power, the RIRR is also an invalid exercise of the CHED’s quasi-legislative power."

• Ople v. Torres, 354 Phil. 948 (1998) — Controlling precedent. Declared void an administrative order creating a national ID system as a usurpation of legislative power, distinguishing between legislative power (to make laws) and executive power (to enforce laws).
• Liga ng mga Barangay National v. City Mayor of Manila, 465 Phil. 529 (2004) — Followed regarding the rule on judicial hierarchy and concurrent jurisdiction of courts.

• Section 1, Article VI, 1987 Constitution — Vesting legislative power in Congress, except to the extent reserved to the people by the provision on initiative and referendum.
• Section 3, Republic Act No. 7722 (Higher Education Act of 1994) — Defines CHED's coverage as both public and private institutions of higher education and degree-granting programs in post-secondary educational institutions.
• Section 8, Republic Act No. 7722 — Enumerates the powers and functions of the CHED.
• Section 20, Title I, Book III, Executive Order No. 292 (Administrative Code of 1987) — Residual powers of the President, exercisable only when provided for under the law.
• Sections 5, 7, and 15, Republic Act No. 8981 (PRC Modernization Act of 2000) — PRC's mandate and powers to safeguard examination integrity; interpreted not to extend to the regulation of review centers.

Reynato S. Puno (CJ), Leonardo A. Quisumbing, Consuelo Ynares-Santiago, Ma. Alicia Austria-Martinez, Renato C. Corona, Conchita Carpio Morales, Dante O. Tinga, Minita V. Chico-Nazario, Presbitero J. Velasco, Jr., Antonio Eduardo B. Nachura, Arturo D. Brion, Teresita J. Leonardo-De Castro, Diosdado M. Peralta.

Justice Brion wrote a separate concurring opinion arguing that while EO 566 is invalid under RA 7722, the President has adequate powers to regulate review centers under RA 8981 through the PRC. Transferring this regulatory power from the PRC to CHED constituted an illegal sub-delegation of delegated power (potestas delegata non delegare potest), as the President cannot transfer the functions of one department or agency to another without transgressing the legislative prerogatives of Congress.