Philippine National Bank v. Tejano
REITERATIONFacts
The Antecedents: Respondent Cayetano A. Tejano, Jr., then Vice-President and Manager of the Philippine National Bank (PNB) Cebu City branch, along with eight other employees, was charged with grave misconduct, gross neglect of duty, conduct grossly prejudicial to the best interest of the service, and violations of Republic Act No. 3019. These charges stemmed from alleged irregular and fraudulent transactions involving corporate accounts of entities such as Pat International Trading Corporation, Khun Tong International Trading Corporation, and V&G Better Homes Subdivision. These transactions occurred when PNB was still a government-owned and controlled corporation. Procedural History: The PNB Management Hearing Committee found respondent Tejano guilty of grave misconduct for misappropriating V&G funds and gross neglect in extending unwarranted credit to PITC, PGIC, and KITC, recommending forced resignation without forfeiture of benefits. The PNB Board of Directors, however, found gross neglect as an aggravating circumstance to grave misconduct and imposed forced resignation with forfeiture of benefits. After the Board denied his motion for reconsideration, Tejano appealed to the Civil Service Commission (CSC). While his appeal was pending, PNB was privatized under Executive Order No. 80. The CSC initially dismissed his appeal as filed out of time, and in a subsequent resolution, dismissed it on the ground that PNB's privatization removed the case from CSC's jurisdiction. Tejano then elevated the matter to the Court of Appeals (CA). The Petition: The Court of Appeals granted Tejano's petition for review, reversing the CSC's resolutions and remanding the case to the CSC for further proceedings. The CA ruled that the CSC retained jurisdiction over the appeal despite PNB's privatization. PNB filed the instant petition for review under Rule 45 of the Rules of Civil Procedure, arguing that Section 6 of E.O. No. 80 divested the CSC of jurisdiction over pending cases involving PNB employees upon its conversion to a private entity. Tejano countered that E.O. No. 80 did not expressly provide for the transfer or divestment of jurisdiction over pending appeals and invoked estoppel against PNB due to its prior participation in the CSC proceedings. The Supreme Court denied PNB's petition, affirming the CA's decision and holding that Section 6 of E.O. No. 80 did not divest the CSC of jurisdiction over Tejano's pending appeal, as laws generally have prospective effect unless expressly provided otherwise.
Issue(s)
Whether the privatization of the Philippine National Bank (PNB) pursuant to Executive Order (E.O.) No. 80 divested the Civil Service Commission (CSC) of jurisdiction over an administrative appeal pending at the time of the bank's conversion into a private institution.
Ruling
The petition is DENIED. The Decision of the Court of Appeals is AFFIRMED. The case is remanded to the Civil Service Commission for further proceedings on the merits.
Ratio Decidendi
On the Issue of Jurisdiction and Privatization: The Supreme Court held that Section 6 of Executive Order (E.O.) No. 80 does not divest the Civil Service Commission (CSC) of jurisdiction over pending disciplinary cases involving acts committed while the Philippine National Bank (PNB) was still a government-owned and controlled corporation (GOCC). The Court emphasized the rule that jurisdiction is conferred by law and, once acquired, continues until the case is finally terminated. Applying the principle of lex prospicit, non respicit under Article 4 of the Civil Code, the Court ruled that laws generally have prospective effect and do not apply to pending disputes unless expressly stated. The language of Section 6 of E.O. No. 80 is plain and clear; it outlines the legal consequences of privatization but contains no provision authorizing the retroactive transfer of jurisdiction for cases already pending before the CSC. Citing Bengzon v. Inciong and Latchme Motoomull v. Dela Paz, the Court reiterated that new legislation placing jurisdiction in another tribunal does not affect a court's power to proceed to a final determination unless the statute expressly provides for such operation on pending actions. Since E.O. No. 80 lacks such an express mandate, the CSC's appellate jurisdiction, which attached upon the filing of the appeal and memorandum, remains intact until the case is resolved on its merits.
Main Doctrine
The principle of adherence of jurisdiction dictates that once a court or administrative body acquires jurisdiction over a controversy, it retains that jurisdiction until the final determination of the cause, regardless of subsequent legislation, unless the statute expressly provides for retroactivity or the transfer of pending cases. In the context of government-owned and controlled corporation (GOCC) privatization, the removal of the entity from the coverage of the Civil Service Commission (CSC) under a new charter operates prospectively and does not divest the CSC of jurisdiction over disciplinary cases involving acts committed and appeals perfected while the entity was still under government control.