[G.R. No. L-25916. April 30, 1970.

GAUDENCIO A. BEGOSA, Plaintiff-Appellee, v. CHAIRMAN, PHILIPPINE VETERANS

ADMINISTRATION; and MEMBERS OF THE BOARD OF ADMINISTRATORS, PHILIPPINE
VETERANS ADMINISTRATION, Defendants-Appellants.

Jose V . Rosales for Plaintiff-Appellee.

Solicitor General, for Defendants-Appellants.

SYLLABUS

1. REMEDIAL LAW; PARTIES; DOCTRINE OF NON-SUABILITY OF STATE, EXCEPTION. It is well

settled that where a litigation may have adverse consequences on the public treasury, whether in the
disbursements of funds or loss of property, the public official proceeded against not being liable in his
personal capacity, then the doctrine of non-suability may appropriately be invoked. It has no application,
however, where the suit against such a functionary had to be instituted because of his failure to comply
with the duty imposed by statute appropriating public funds for the benefit of plaintiff or petitioner

2. ID.; ADMINISTRATIVE LAW; EXHAUSTION OF ADMINISTRATIVE REMEDY UNNECESSARY

WHERE QUESTION IS LEGAL; CASE AT BAR. It is well established that the principle requiring the
previous exhaustion of administrative remedies is not applicable where the question in dispute is purely a
legal one, or where the controverted act is patently illegal or was performed without jurisdiction or in
excess of jurisdiction, or where the respondent is a department Secretary, whose acts as an alter-ego of
the President bear the implied or assumed approval of the latter, unless actually disapproved by him, or
where there are circumstances indicating the urgency of judicial intervention. Where there is a stipulation
of facts, as in this case, the question before the lower court being solely one of law and on the face of the
decision, the actuation of appellants being patently illegal, the doctrine of exhaustion of administrative
remedies certainly does not come into play.

3. ID.; ID.; FINDINGS OF REGULATORY AGENCIES ENTITLED TO RESPECT. It has often been
announced, and rightly so, that as much as possible the findings of regulatory agencies which are
expected to acquire expertise by their jurisdiction being confined to specific matters, deserve to be
accorded respect and finality. There is a limit, however, to such a deference paid to the actuations of such
bodies. Clearly, where there has been a failure to interpret and apply the statutory provisions in question,
judicial power should assert itself. Under the theory of separation of powers, it is to the judiciary, and to
the judiciary alone, that the final say on questions of law in appropriate cases coming before it is vested.

DECISION

FERNANDO, J.:

Plaintiff Gaudencio A. Begosa, now appellee, sought the aid of the judiciary to obtain the benefits to
which he believed he was entitled under the Veterans Bill of Rights. 1 To such a move, there was an
insistent objection, both vigorous and persistent, on the part of defendants, the chairman and the
members of the Philippine Veterans Administration, now appellants. The lower court, then presided by the
then Judge, now Justice of the Court of Appeals, the Honorable Edilberto Soriano, found for plaintiffs,
after a careful and meticulous study of the applicable statutory provisions. Not being satisfied with such a
judgment, defendants appealed, relying once more on the principal grounds raised below that plaintiff
should have exhausted his administrative remedies before coming to court and that he was in fact suing
the State without its consent having been obtained. As neither defense is sufficiently meritorious, we
affirm the lower court decision.

As noted in such decision, appellees complaint was predicated on his having been "an enlisted man in
good standing of the Philippine Commonwealth Army, inducted in the service of the USAFFE" and having
taken "active participation in the battle of Bataan" as well as the "liberation drive against the enemy"
thereafter having become "permanently incapacitated from work due to injuries he sustained in line of
duty . . ." 2 It was likewise asserted in his complaint that after having submitted all the supporting papers
relative to his complaint, there was a disapproval on the part of defendants on the ground of his having
been dishonorably discharged, although such an event did not take place until almost five years after the
end of the war on November 7, 1950 and while he was in the service of a different organization that such
a penalty was imposed on him. 3

Then came the allegation that there was an approval on his claim on September 2, 1964 but effective
only as of October 5 of that year, and for amount much less than that to which he was entitled under the
law. 4 The relief sought was the payment, as of the date to which he believed his right to pension should
have been respected, of the sums, which he felt were legally due and owing to him.chanrobles virtual
lawlibrary

The then Judge Soriano noted that there was an admission of certain allegations to the complaint with
others being denied, and that the following affirmative and special defenses were interposed:
"Defendants answer admits certain allegations of said complaint, while denying others; set up the
following affirmative and special defenses: (1) payment of disability pension under Republic Act No. 65,
as amended, by the Philippine Veterans Administration commences from the date the proper application
therefor is approved; (2) plaintiff has not exhausted all administrative remedies before resorting to court
action, hence the present action is premature; (3) inasmuch as the instant action pertains to money claim
against the Government, it must first be presented before the Auditor General as provided by existing law
on the matter (C.A. 327); and (4) plaintiffs claim is in reality a suit against the Government which cannot
be entertained by this Court for lack of jurisdiction because the Government has not given its consent, . .
." 5 The case was then submitted on an agreed statement of facts and the respective memoranda of the
parties.

In the decision now on appeal, the question of when appellee is entitled to his pension as well as how
much it would amount to were fully discussed by the lower court. Thus, as to the former: "From the facts
just set out, it will be noted that plaintiff filed his said claim for disability pension as far back as March 4,
1955; that it was erroneously disapproved on June 21, 1955, because his dishonorable discharge from
the Army was not a good or proper ground for the said disapproval, and that on reconsideration asked for
by him on November 1, 1957, which he continued to follow up, the Board of Administrators, Philippine
Veterans Administration, composed of herein defendants, which took over the duties of the Philippine
Veterans Board, finally approved his claim on September 2, 1964, at the rate of P30.00 a month." 6 After
stating that in fairness and good conscience the said claims could be made effective as of June 21, 1955,
when it was erroneously disapproved by appellants, and not on September 2, 1964 when it was approved
on reconsideration, as appellee should not for obvious reason be made to suffer for the error of another,
the then Judge Soriano observed further: "Had it not been for the said error, it appears that there was no
good ground to deny the said claim, so the latter was valid and meritorious even as of the date of its filing
on March 4, 1955, hence to make the same effective only as of the date of its approval on September 2,
1964 according to defendants stand would be greatly unfair and prejudicial to plaintiff. This is
especially true in the light of the well-known intent of the legislature in passing these pension laws of war
veterans, and the no less well-known spirit in which they should be construed or interpreted by the courts
in favor of their beneficiaries." 7

On the question of how much plaintiff should receive according to law, the appealed decision contains the
following: "The next question for resolution refers to the monthly rate or amount to which plaintiff is
entitled by way of pension. According to plaintiff, he should be given a disability pension of P50.00 a
month from June 21, 1955 (the effective date of his claim as above found by this Court) until June 21,
1957, and P100.00 a month for life from June 22, 1957 when Section 9 of Republic Act No. 65, as
amended by Republic Act No. 1362, was further amended by Republic Act No. 1920). This contention is
well taken because the very letter of the Philippine Veterans Administration to plaintiff (Annex F of the
[Agreed Statements of Facts]) contains the following: Note: Re-rating is not required, permanent
disability. By permanent disability, as this Court understands it, is meant that plaintiff is permanently
incapacitated from work. Under Section 9 of Republic Act No. 65, as amended by Republic Act No. 1362,
which was the law in force when plaintiffs claim for pension should have been approved on June 21,
1955, he was entitled to a pension of P50.00 a month as such permanently incapacitated person, which
monthly rate or amount was increased to P100.00 a month when the said Section 9 was further amended
by Republic Act No. 1920 on June 22, 1957." 8 Why the action of appellants in the form of resolution
could not prevail as against the law was made clear by the decision in this wise: "For one thing, the said
resolution may not change or amend the meaning of the term permanent disability as used by Congress
itself in enacting the said Section 9 of Republic Act No. 65, as amended. For another, as of June 21, 1955
and as of June 21, 1957, plaintiff was already entitled to the said pension of P50.00 and P100.00 a month
respectively, and his said right cannot be adversely affected by a resolution which was allegedly adopted
only in 1963." 9 Necessarily, there was in the decision likewise a recognition of the monthly allowance for
each of appellees unmarried minor children below 18 years of age at the time he was entitled to the
pension to which under the statute he could validly lay claim.chanroblesvirtuallawlibrary

After rejecting as untenable the defenses that there was no exhaustion of administrative remedies, that
the action is in the nature of money claim which should first be presented before the Auditor General, and
that said action is in reality a suit against the Government without the latters consent, the decision
concludes with the following:" [Wherefore], judgment is hereby rendered in accordance with the prayer of
plaintiffs amended complaint, to wit, that defendants make plaintiffs pension effective June 21, 1955 at
the rate of P50.00 a month up to June 21, 1957 at the rate of P100.00 a month, plus P10.00 a month
each for his four unmarried minor children below 18 years old from June 22, 1957 up to September 1,
1964; and the difference of P70.00 a month, plus P10.00 for his one unmarried minor child below 18
years old from September 2, 1954, and thereafter, with costs against said dependents." 10

Appellants elevated the matter to us. The careful and painstaking way in which the controlling statutory
provisions were considered and applied by the then Judge Soriano must have impelled them to place
their faith in the alleged failure to respect the doctrines of non-suability and exhaustion of administrative
remedies to obtain a reversal. The appealed decision, however, as will now be shown is not subject to
such a reproach. The appeal then, as noted at the outset, is not to be attended with success.

1. The fourth assignment of error assails what it considers to be the failing of the lower court in not
holding that the complaint in this case is in effect a suit against the State which has not given its consent
thereto. We have recently had occasion to reaffirm the force and primacy of the doctrine of non-suability.
11 It does not admit of doubt, then, that if the suit were in fact against the State, the lower court should
have dismissed the complaint. Nor is it to be doubted that while ostensibly an action may be against a
public official, the defendant may in reality be the government. As a result, it is equally well-settled that
where a litigation may have adverse consequences on the public treasury, whether in the disbursements
of funds or loss of property, the public official proceeded against not being liable in his personal capacity,
then the doctrine of non-suability may appropriately be invoked. It has no application, however, where the
suit against such a functionary had to be instituted because of his failure to comply with the duty imposed
by statute appropriating public funds for the benefit of plaintiff or petitioner. Such is the present
case.chanroblesvirtual|awlibrary

The doctrine announced by us in Ruiz v. Cabahug 12 finds relevance: "We hold that under the facts and
circumstances alleged in the amended complaint, which should be taken on its face value, the suit is not
one against the Government, or a claim against it, but one against the officials to compel them to act in
accordance with the rights to be established by the contending architects, or to prevent them from making
payment and recognition until the contending architects have established their respective rights and
interests in the funds retained and in the credit for the work done." 13 As a matter of fact, in an earlier
case where we sustained the power of a private citizen claiming title to and right of possession of a
certain property to sue an officer or agent of the government alleged to be illegally withholding the same,
we likewise expressed this caveat: "However, and this is important, where the judgment in such a case
would result not only in the recovery of possession of the property in favor of said citizen but also in a
charge against or financial liability to the Government, then the suit should be regarded as one against
the government itself, and, consequently, it cannot prosper or be validly entertained by the courts except
with the consent of said Government." 14

2. Nor is the third assignment of error to the effect that the lower court did not require appellee to exhaust
his administrative remedies before coming to court any more persuasive. An excerpt from the leading
case of Gonzales v. Hechanova, 15 the opinion being penned by the present Chief Justice, clearly
demonstrates why appellants argument in this respect is unavailing: "Respondents assail petitioners
right to the reliefs prayed for because he has not exhausted all administrative remedies available to him
before coming to court. We have already held, however, that the principle requiring the previous
exhaustion of administrative remedies is not applicable where the question in dispute is purely a legal
one, or where the controverted act is patently illegal or was performed without jurisdiction or in excess of
jurisdiction, or where the respondent is a department secretary, whose acts as an alter-ego of the
President bear the implied or assumed approval of the latter, unless actually disapproved by him, or
where there are circumstances indicating the urgency of judicial intervention." 16 The Gonzales doctrine,
it is to be noted, summarized the views announced in earlier cases. 17 The list of subsequent cases
reiterating such a doctrine is quite impressive. 18 To be more specific, where there is a stipulation of
facts, as in this case, the question before the lower court being solely one of law and on the face of the
decision, the actuation of appellants being patently illegal, the doctrine of exhaustion of administrative
remedies certainly does not come into play.

3. The other errors assigned, namely the alleged failure of the lower court to comply with the law in fixing
the amounts to which appellee is entitled instead of following the rules and regulations on veterans
benefits promulgated by appellants and the alleged interference with the purely discretionary matter of a
coordinate administrative agent, the Philippine Veterans Administration, can easily be disposed of. It is to
be admitted that appellants as chairman and members of the Philippine Veterans Administration, formerly
the Philippine Veterans Board, are officials of an administrative body. 19 Nor may exception be taken to
the general principle that as much as possible the courts should view with the utmost sympathy the
exercise of power of administrative tribunals whether in its rule-making or adjudicatory capacity. It has
often been announced, and rightly so, that as much as possible the findings of these regulatory agencies
which are expected to acquire expertise by their jurisdiction being confined to specific matters, deserve to
be accorded respect and finality. There is a limit, however, to such a deference paid to the actuations of
such bodies. Clearly, where there has been a failure to interpret and apply the statutory provisions in
question, judicial power should assert itself. Under the theory of separation of powers, it is to the judiciary
and to the judiciary alone, that the final say on questions of law appropriate cases coming before it is
vested.chanrobles.com : virtual law library

When the then Judge Soriano, therefore, as he was called upon to do, saw to it that there was strict
compliance with the amounts of pension required by the law to be granted plaintiff and disregarded the
regulation promulgated under the rule-making power of appellants, the effect of which would make
appellee suffer the consequences of an error committed by them, it cannot be truly said that his decision
may be assailed as being offensive to authoritative doctrines. On the contrary, it can stand the test of the
utmost scrutiny. Precisely because the commands of the law were duly carried out, it cannot be set aside.

WHEREFORE, the decision of the then Judge Edilberto Soriano of the Court of First Instance of Manila
promulgated on January 22, 1966, is affirmed. Without pronouncement as to costs.

Concepcion, C.J., Reyes, J .B.L., Dizon, Makalintal, Zaldivar, Castro and Villamor, JJ., concur.

Teehankee, J., concurs in the result.

Barredo, J . is on leave.