[G.R. No. 129616.

April 17, 2002]

THE GENERAL MANAGER, PHILIPPINE PORTS AUTHORITY (PPA) and RAMON

ANINO, petitioners, vs. JULIETA MONSERATE, respondent.

DECISION

SANDOVAL-GUTIERREZ, J.:

This petition for review on certiorarii[1] seeks to set aside the Decision dated June 20, 1997 of
the Court of Appeals in CA-G.R. No. 39670,ii[2] declaring null and void the Resolution No.
952043 dated March 21, 1995 and Resolution No. 956640 dated October 24, 1995 of the Civil
Service Commission (CSC), and ordering the reinstatement of Julieta G. Monserate as Division
Manager II of the Resources Management Division, Ports Management Office, Philippine Ports
Authority (PPA), Iloilo City.

The facts are:

Julieta Monserate, respondent, started her government service in 1977 as Bookkeeper II in the
Port Management Office, PPA, Iloilo City. Barely a year later, she was promoted to the position
of Cashier II and then as Finance Officer (SG-16) in 1980.iii[3]

In the early part of 1988, when the PPA underwent a reorganization, respondent applied for the
permanent position of Manager II (SG-19) of the Resource Management Division, same office.
The Comparative Data Sheetiv[4] accomplished by the PPA Reorganization Task Force shows
the ranking of the six (6) aspirants to the said position, thus:

COMPARATIVE DATA SHEET

OFFICE: PMO ILOILO

DIVISION: RES. MANAGEMENT
DIVISION
POSITION: DIVISION MANAGER
REQUIRED CS ELIG.: CS PROF / RA 1080

CANDIDATES ELIGIBILITY xxx TOTAL

1. MONSERATE, JULIETA CS Prof. xxx 79.5

2. ANINO, RAMON 1st grade xxx 70
3. TEODOSIO, APRIL PD 907 (CPA) xxx 67
4. MORTOLA, DARIO CS Prof. xxx 67
5. ESPINOSA, AMALIK Bar xxx
63.5
6. PERFECTO, BASCOS RA 1080 xxx 59.5
On February 1, 1988, Maximo Dumlao, Jr., then General Manager of the PPA, appointedv[5]
respondent to the position of Manager II (Resource Management Division). On even date,
respondent assumed office and discharged the functions thereof. On July 8, 1988, the CSC,
through Guillermo R. Silva (Assistant Director of the Civil Service Field Office-PPA) approved
her appointment.

Meanwhile, on April 18, 1988, petitioner Ramon Anino, who ranked second to respondent per
the Comparative Data Sheet earlier quoted, filed an appeal/petition with the PPA Appeals Board,
protesting against respondents appointment. The PPA Appeals Board, in a Resolutionvi[6] dated
August 11, 1988, sustained the protest and rendered ineffective respondents appointment based
on (1) CSC MC No. 5, s. 1988, Par. 3;vii[7] (2) CSC MC NO. 10, s. 1986, Par. A, 1.2 and Par.
B;viii[8] and (3) Civil Service Eligibility. These grounds were not explained or discussed in the
Resolution, the dispositive portion of which reads:

WHEREFORE, premises considered, this Board upholds the appointment of Ramon A. Anino as
Resources Management Division Manager of the Port Management Office of Iloilo.

On October 24, 1988, respondent was furnished a copy of PPA Special Order No. 479-88ix[9]
(entitled Creation of the PPA Managers Pool), dated September 28, 1988, issued by the new PPA
General Manager, Mr. Rogelio A. Dayan. That Special Order excluded the name of respondent
from the pool-list and placed instead the name of petitioner as Manager II, Resource
Management Division. In effect, the Special Order implemented the August 11, 1988 Resolution
of the PPA Appeals Board.

Aggrieved, respondent filed with the PPA General Manager an appeal/request for clarification
dated November 2, 1988.x[10] She questioned her replacement under PPA Special Order No.
479-88, claiming that the proceedings before the PPA Appeals Board were irregular because (1)
she was not notified of the hearing before it; (2) she was not furnished a copy of the August 11,
1988 PPA Appeals Board Resolution or a copy of the protest filed by petitioner Anino;xi[11] (3)
she was not informed of the reasons behind her replacement; and (4) their Port Manager (in Iloilo
City), who was then an official member of the Board, was not included in the said proceedings.

On November 8, 1988, pending resolution of her appeal/request for clarification, respondent

received a copy of PPA Special Order No. 492-88xii[12] dated October 21, 1988, also issued by
General Manager Dayan. This PPA Order officially reassigned her to the position of
Administrative Officer (SG-15) which was petitioner Anino's former position and was lower
than her previous position as Finance Officer (SG 16) before she was appointed as Division
Manager.

Apparently at a loss with the turn of events, coupled by the inaction of PPA General Manager
Dayan on her earlier appeal/request for clarification, respondent filed on November 25, 1988 a
precautionary appealxiii[13] with the CSC. She manifested that as of said date (November 25),
she has not yet been furnished a certified copy of the PPA Appeals Board Resolution.

On January 2, 1989, respondent received a copy of her new appointment as Administrative

Officer dated October 1, 1988.xiv[14] It was also during this time when she learned that PPA
General Manager Dayan had just issued petitioners appointment dated October 21, 1988 as
Manager II in the Resource Management Division effective February 1, 1988.

On January 16, 1989, respondent filed with the CSC an appeal formally protesting against
petitioner Aninos appointment and at the same time questioning the propriety of the August 11,
1988 Resolution of the PPA Appeals Board. This appeal remained pending with the CSC for
more than six (6) years despite respondent's requests for early resolution. In the meantime, she
assumed the position of Administrative Officer.

Eventually, the CSC, in its Resolution No. 95-2043xv[15] dated March 21, 1995, dismissed
respondents appeal, thus:

It is well-established rule that an appointment, although approved by this Commission, does not
become final until the protest filed against it is decided by the agency or by the Commission.
Although Monserate had already assumed the position of RMD Manager II, the appointing
authority may still withdraw the same if a protest is seasonably filed. This is covered by Section
19, Rule VI of the Omnibus Rules implementing EO 292 x x x.

Monserates claim that she is more qualified than Anino is not relevant to the issue before this
Commission. In cases of protest filed or appealed to the Commission, the main question to be
resolved is whether or not the appointee meets the qualification standard. x x x. The Commission
will not disturb the choice of the appointing authority as long as the appointee meets the
qualification prescribed for the position in question.

Respondent filed a motion for reconsideration but the same was denied by the CSC in its
Resolution No. 95-6640 dated October 24, 1995.

In due time, respondent filed with the Court of Appeals a petition for review impleading as
respondents the PPA General Manager and petitioner Anino.

On June 20, 1997, the Court of Appeals rendered a Decisionxvi[16] nullifying the twin
Resolutions of the CSC. It ruled that the August 11, 1988 Resolution of the PPA Appeals Board
was not supported by evidence and that the same was irregularly issued due to lack of proper
notice to respondent with respect to the Boards proceedings. It concluded that her reassignment
from the position of Manager II, Resource Management Division (SG-19), to the position of
Administrative Officer (SG-15) was a demotion violative of her constitutional right to security of
tenure and due process. The dispositive portion of the Court of Appeals' Decision reads:

THE FOREGOING CONSIDERED, judgment is hereby rendered declaring as null and void
Resolution Nos. 952043 and 95640 (should be 956640) dated March 21 and October 21, 1988
(should be October 24, 1995), of the Civil service Commission; and directing the reinstatement
of the petitioner to the position of Resource Management Division Manager II.

SO ORDERED.
Thereupon, Ramon Anino and the PPA General Manager filed on August 14, 1997 the present
petition. On November 30, 1997, petitioner Anino retired from the government service.xvii[17]

Petitioners ascribe to the Court of Appeals the following errors:

I THE COURT OF APPEALS SERIOUISLY ERRED IN FINDING THAT

RESPONDENT MONSERATE WAS DEMOTED FROM RESOURCES MANAGEMENT
DIVISION MANAGER TO ADMINISTRATIVE OFFICER, THUS VIOLATING HER RIGHT
TO SECURITY OF TENURE.

II THE COURT OF APPEALS GRAVELY ERRED IN NOT ALIGNING ITSELF WITH

THE WELL-NIGH RULE THAT RESPONDENT MONSERATES APPOINTMENT AS
RESOURCE MANAGEMENT DIVISION MANAGER, ALTHOUGH APPROVED BY CSC,
DOES NOT BECOME FINAL UNTIL THE PROTEST FILED AGAINST HER IS
FAVORABLY DECIDED IN HER FAVOR BY THE AGENCY OR THE CSC.

III THE COURT OF APPEALS COMMITTED A SERIOUS ERROR OF JUDGMENT IN

IGNORING THAT IN CASES OF PROTEST FILED OR APPEALED TO THE CSC, THE
MAIN QUESTION TO BE RESOLVED IS WHETHER OR NOT THE APPOINTEE MEETS
THE QUALIFICATION STANDARD.xviii[18]

The pivotal issue in this case is whether or not there was due process when respondent was
replaced by petitioner Anino from her position as Manager II, Resource Management Division,
and demoted as Administrative Officer.

Petitioners vehemently aver that respondent was never demoted since demotion, being in the
nature of administrative penalty, presupposes a conviction in an administrative case. Here,
respondent was not charged of any administrative case. Rather, she was displaced from her
position as an aftermath of the PPA reorganization, authorized by law, the implementation of
which having been carried out with utmost good faith.

Furthermore, the said displacement was just the necessary effect of the August 11, 1988
Resolution of the PPA Appeals Board which sustained petitioner Aninos timely protest against
respondents appointment. Petitioners theorize that the appointment of respondent as Resource
Management Division Manager did not become final until the protest filed against her was
favorably decided in her favor by the CSC. In support of this contention, they cited Section 19,
Rule VI of the Omnibus Rules Implementing Book V of Executive Order No. 292 (otherwise
known as the Administrative Code of 1987), which provides inter alia:

SEC 19. An appointment, though contested, shall take effect immediately upon its issuance if the
appointee assumes the duties of the position and the appointee is entitled to receive the salary
attached to the position. However, the appointment, together with the decision of the department
head, shall be submitted to the Commission for appropriate action within 30 days from the date
of its issuance, otherwise the appointment becomes ineffective thereafter. Likewise, such
appointment shall become ineffective in case the protest is finally resolved against the
protestee, in which case, he shall be reverted to his former position.
Petitioners also contend that the head of an agency, being the appointing authority, is the one
most knowledgeable to decide who can best perform the functions of the office. The appointing
authority has a wide latitude of choice subject only to the condition that the appointee should
possess the qualifications required by law. Consequently, the CSC acted rightly when it did not
interfere in the exercise of discretion by the PPA appointing authority, there being no evidence of
grave abuse of discretion thereof or violation of the Civil Service Law and Rules.

The petition is unmeritorious.

In the first place, the PPA reorganization in 1988 has nothing to do with respondents demotion
from the contested position of Manager II, Resource Management Office (SG-19), to the lower
position of Administrative Officer (SG-15). Antithetically, it was precisely because of the said
reorganization that respondent applied to the higher position of Division Manager II. In fact, the
Comparative Data Sheet accomplished by the PPA Reorganization Task Force itself shows that
respondent ranked No. 1, while petitioner Anino ranked No. 2, from among the six (6)
contenders to the said post. Respondent was eventually issued a permanent appointment as such
Division Manager on February 1, 1988 by then PPA General Maximo Dumlao, Jr., during which
time she actually assumed office and discharged its functions. This appointment was later
approved on July 8, 1988 by the CSC, through Assistant Director Guillermo R. Silva of the Civil
Service Field Office-PPA.

Clearly, it was only after the reorganization and upon the issuance of the August 11, 1988
Resolution of the PPA Appeals Board when respondent was demoted to the lower position of
Administrative Officer. This is further shown by the following orders and appointments
subsequently issued by then PPA General Manager Rogelio Dayan:

1. PPA Special Order No. 479-88 dated September 28, 1988 which excluded respondent
Monserate from the PPA Managers pool-list;

2. Appointment of respondent, dated October 1, 1988, to the position of Administrative

Officer;

3. PPA Special Order No. 492-88 dated October 21, 1988 which officially reassigned
respondent to the position of Administrative Officer; and

4. Appointment of petitioner Anino, dated October 21, 1988, to the position of Manager II,
Resource Management Division, effective February 1, 1988.

Therefore, contrary to petitioners claim, respondent was demoted, not by reason of the PPA
reorganization in 1988, but due to the PPA Appeals Board Resolution dated August 11, 1988
sustaining petitioner Aninos protest against respondents appointment.

Unfortunately for petitioners, this Court cannot accord validity to the August 11, 1988
Resolution of the PPA Appeals Board which upholds the appointment of Ramon A. Anino as
Resource Management Division Manager. But how can it uphold his appointment when he
was not yet appointed then? It bears stressing that he was appointed on a much later date -
October 21, 1988, or more than two (2) months after August 11, 1998 when the PPA
Appeals Board Resolution was issued. Stated differently, the PPA Appeals Board could not
uphold an appointment which was not yet existing.

Equally questionable are the grounds for respondents demotion stated in the August 11, 1998
Resolution: (1) CSC MC No. 5, s. 1988, Par. 3; (2) CSC MC NO. 10, s. 1986, Par. A, 1.2 and
Par. B; and (3) Civil Service Eligibility. These grounds are incomprehensible for lack of
discussion or explanation by the Board to enable respondent to know the reason for her
demotion.

We uphold the Court of Appeals finding that the August 11, 1998 PPA Appeals Board
Resolution was void for lack of evidence and proper notice to respondent. As aptly held by the
Appellate Court:

In the August 11, 1988 Resolution by the PPA Appeals Board (Ibid., p. 46) upholding the
appointment of the private respondent (Ramon Anino) as Division Manager, the grounds against
petitioner's (Julieta Monserate) appointment were: a) the CSC MC No. 5, s. 1988, Par 3; b) the
CSC MC No. 10, 2. 1986, Par. A, 1.2 and Par. B; and c) Civil service eligibility.

"x x x

To us, the August 11, 1988 Resolution by the PPA Appeals Board was not supported by
evidence. Of the CSC MC No. 5, the petitioner had no pending administrative or criminal case at
the time of her appointment as Manager. x x x.

With respect to the CSC MC No. 10, Par. A (1.2) and Par. B, the processing, review, evaluation
and recommendation of her appointment as Manager II, passed several committees created by
the PPA. x x x. Moreover, she had a 1.9 average performance rating compared to the private
respondent who only got 2.03. x x x.

On eligibility, she has a Career Service Professional eligibility while the private respondent only
has a First Grade Civil Service Eligibility.

She added that she was not aware of any proceeding on her demotion as a Division Manager. As
a matter of fact, it was only upon her iniative sometime during the latter part of November, 1988
that she was able to obtain a copy of the August 11, 1988 Resolution of the Appeals Board. The
resolution sustained the private respondents appointment as Division Manager even if on August
11, 1988, he was not yet extended any appointment. As a matter of fact, he was appointed only
on October 1, 1988 (should be October 21, 1988).

Furthermore, she said that the resolution of the PPA Appeals Board appears irregular, if not null
and void. She was never notified of any proceeding; she was not furnished either a copy of the
resolution. What she received instead was a Special Order dated September 29, 1988 already
ordering her demotion. She was not at all given the oppurtunity of defending herself before the
Appeals Board.
x x x.

In the case now before us, the petitioner did not receive or was not given a copy of the August
11, 1988 Resolution of the Appeals Board. She did not even know that she was demoted until
after she received a copy of the of the Special Order No. 479-88.xix[19]

From all indications, it is indubitable that substantial and procedural irregularities attended
respondents demotion from the position of Manager II, Resource Management Division, to the
lower position of Administrative Officer. Indeed, her demotion, tantamount to a revocation of
her appointment as Manager II, is a patent violation of her constitutional rights to security of
tenure and due process. In Aquino vs. Civil Service Commission,xx[20] this Court emphasized that
once an appointment is issued and the moment the appointee assumes a position in the civil
service under a completed appointment, he acquires a legal, not merely equitable, right (to the
position) which is protected not only by statute, but also by the constitution, and cannot be taken
away from him either by revocation of the appointment, or by removal, except for cause, and
with previous notice and hearing.

Concededly, the appointing authority has a wide latitude of discretion in the selection and
appointment of qualified persons to vacant positions in the civil service.xxi[21] However, the
moment the discretionary power of appointment is exercised and the appointee assumed the
duties and functions of the position, such appointment cannot anymore be revoked by the
appointing authority and appoint another in his stead, except for cause. Here, no iota of evidence
was ever established to justify the revocation of respondent's appointment by demoting her.
Respondents security of tenure guaranteed under the 1987 Constitution [Article IX-B, Section 2,
par. (3)] should not be placed at the mercy of abusive exercise of the appointing power.xxii[22]

Parenthetically, when the Court of Appeals reinstated respondent to her legitimate post as
Manager II in the Resource Management Division, it merely restored her appointment to the said
position to which her right to security of tenure had already attached. To be sure, her position as
Manager II never became vacant since her demotion was void. In this jurisdiction, "an
appointment to a non-vacant position in the civil service is null and void ab initio."xxiii[23]

We now delve on the backwages in favor of respondent.

The challenged Court of Appeals Decision ordered the reinstatement of respondent without
awarding backwages. This matter becomes controversial because respondent assumed the lower
position of Administrative Officer during the pendency of her protest against petitioner Aninos
appointment to the contested position. Also, petitioner Anino retired from the service on
November 30, 1997.

In this respect, while petitioner Aninos appointment to the contested position is void, as earlier
discussed, he is nonetheless considered a de facto officer during the period of his
incumbency.xxiv[24] A de facto officer is one who is in possession of an office and who openly
exercises its functions under color of an appointment or election, even though such appointment
or election may be irregular.xxv[25] In Monroy vs. Court of Appeals,xxvi[26] this Court ruled that a
rightful incumbent of a public office may recover from a de facto officer the salary received by
the latter during the time of his wrongful tenure, even though he (the de facto officer) occupied
the office in good faith and under color of title. A de facto officer, not having a good title, takes
the salaries at his risk and must, therefore, account to the de jure officer for whatever salary he
received during the period of his wrongful tenure. In the later case of Civil Liberties Union vs.
Executive Secretary,xxvii[27] this Court allowed a de facto officer to receive emoluments for
actual services rendered but only when there is no de jure officer, thus:

x x x in cases where there is no de jure officer, a de facto officer who, in good faith, has had
possession of the office and has discharged the duties pertaining thereto, is legally entitled to the
emoluments of the office, and may in appropriate action recover the salary, fees and other
compensations attached to the office.

In fine, the rule is that where there is a de jure officer, a de facto officer, during his wrongful
incumbency, is not entitled to the emoluments attached to the office, even if he occupied the
office in good faith. This rule, however, cannot be applied squarely on the present case in view
of its peculiar circumstances. Respondent had assumed under protest the position of
Administrative Officer sometime in the latter part of 1988, which position she currently holds.
Since then, she has been receiving the emoluments, salary and other compensation attached to
such office. While her assumption to said lower position and her acceptance of the corresponding
emoluments cannot be considered as an abandonment of her claim to her rightful office (Division
Manager), she cannot recover full backwages for the period when she was unlawfully deprived
thereof. She is entitled only to backpay differentials for the period starting from her assumption
as Administrative Officer up to the time of her actual reinstatement to her rightful position as
Division Manager. Such backpay differentials pertain to the difference between the salary rates
for the positions of Manager II and Administrative Officer. The same must be paid by petitioner
Anino corresponding from the time he wrongfully assumed the contested position up to the time
of his retirement on November 30, 1997.

WHEREFORE, the petition is DENIED. The challenged Decision of the Court of Appeals
dated June 20, 1997 is AFFIRMED with MODIFICATION in the sense that petitioner Ramon A.
Anino is ordered to pay respondent Julieta Monserate backpay differentials pertaining to the
period from the time he wrongfully assumed the contested position of Manager II up to his
retirement on November 30, 1997.

SO ORDERED.