WINSTON F. GARCIA, in his capacity as G.R. No.

157383
President and General Manager of
GSIS,
Petitioner,
- versus -

MARIO I. MOLINA and ALBERT M.

VELASCO,
Respondents.

x--------------------------------------------------x

WINSTON F. GARCIA, in his capacity as G.R. No. 174137

President and General Manager of
the Government Service Insurance Present:
System,
Petitioner, CORONA, C.J.,
CARPIO,
CARPIO MORALES,
VELASCO, JR.,*
NACHURA,
LEONARDO-DE
CASTRO,
BRION,
PERALTA,
- versus -
BERSAMIN,
DEL CASTILLO,
ABAD,
VILLARAMA, JR.,
PEREZ, and
MENDOZA, JJ.

MARIO I. MOLINA and ALBERT M. Promulgated:

VELASCO,
 Respondents.
August 10, 2010

x-------------------------------------------------------------------------------
-----x
 DECISION

NACHURA, J.:
Before the Court are two consolidated petitions filed by Winston F.
Garcia (petitioner) in his capacity as President and General
Manager of the Government Service Insurance System, or GSIS,
against respondents Mario I. Molina (Molina) and Albert M.
Velasco (Velasco). In G.R. No. 157383, petitioner assails the Court
of Appeals (CA) Decision[1] dated January 2, 2003 and
Resolution[2] dated March 5, 2003 in CA-G.R. SP No. 73170. In G.R.
No. 174137, petitioner assails the CA Decision [3] dated December
7, 2005 and Resolution[4] dated August 10, 2006 in CA-G.R. SP No.
75973.

The factual and procedural antecedents of the case are as follows:

Respondents Molina and Velasco, both Attorney V of the GSIS,

received two separate Memoranda[5] dated May 23, 2002 from
petitioner charging them with grave misconduct. Specifically,
Molina was charged for allegedly committing the following acts: 1)
directly and continuously helping some alleged disgruntled
employees to conduct concerted protest actions and/or illegal
assemblies against the management and the GSIS President and
General Manager; 2) leading the concerted protest activities held
in the morning of May 22, 2002 during office hours within the
GSIS compound; and 3) continuously performing said activities
despite warning from his immediate superiors. [6] In addition to the
charge for grave misconduct for performing the same acts as
Molina, Velasco was accused of performing acts in violation of the
Rules on Office Decorum for leaving his office without informing
his supervisor of his whereabouts; and gross insubordination for
persistently disregarding petitioners instructions that Velasco
should report to the petitioners office.[7] These acts, according to
 petitioner, were committed in open betrayal of the confidential
nature of their positions and in outright defiance of the Rules and
Regulations on Public Sector Unionism. In the same Memoranda,
petitioner required respondents to submit their verified answer
within seventy two (72) hours. Considering the gravity of the
charges against them, petitioner ordered the preventive
suspension of respondents for ninety (90) days without pay,
effective immediately.[8] The following day, a committee was
constituted to investigate the charges against respondents.

In their Answer[9] dated May 27, 2002, respondents denied the

charges against them. Instead, they averred that petitioner was
motivated by vindictiveness and bad faith in charging them falsely.
They likewise opposed their preventive suspension for lack of
factual and legal basis. They strongly expressed their opposition to
petitioner acting as complainant, prosecutor and judge.

On May 28, 2002, respondents filed with the Civil Service

Commission (CSC) an Urgent Petition to Lift Preventive Suspension
Order.[10] They contended that the acts they allegedly committed
were arbitrarily characterized as grave misconduct. Consistent
with their stand that petitioner could not act as the complainant,
prosecutor and judge at the same time, respondents filed with the
CSC a Petition to Transfer Investigation to This Commission.[11]

Meanwhile, the GSIS hearing officer directed petitioners to submit to

the jurisdiction of the investigating committee and required them
to appear at the scheduled hearing.[12]

Despite their urgent motions, the CSC failed to resolve respondents

motions to lift preventive suspension order and to transfer the
case from the GSIS to the CSC.
On October 10, 2002, respondents filed with the CA a special civil
action for certiotari and prohibition with prayer for Temporary
Restraining Order (TRO).[13] The case was docketed as CA-G.R. SP
No. 73170. Respondents sought the annulment and setting aside
of petitioners order directing the former to submit to the
jurisdiction of the committee created to hear and investigate the
administrative case filed against them. They likewise prayed that
petitioner (and the committee) be prohibited from conducting the
scheduled hearing and from taking any action on the aforesaid
administrative case against respondents.

On January 2, 2003, the CA rendered a decision[14] in favor of

respondents, the dispositive portion of which reads:

ACCORDINGLY, the petition is hereby GRANTED. Public respondents are

hereby PERPETUALLY RESTRAINED from hearing and investigating the
administrative case against petitioners, without prejudice to pursuing
the same with the Civil Service Commission or any other agency of
government as may be allowed for (sic) by law.

SO ORDERED.[15]

The CA treated the petition as one raising an issue of

gnawing fear, and thus agreed with respondents that the
investigation be made not by the GSIS but by the CSC to ensure
that the hearing is conducted before an impartial and
disinterested tribunal.

Aggrieved, petitioner comes before the Court in this petition

for review on certiorari under Rule 45 of the Rules of Court, raising
the following issues:

I.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS SERIOUSLY
ERRED IN FINDING THAT THE PETITIONERS ABUSED THEIR
AUTHORITY AND HAVE BEEN PARTIAL IN REGARD TO THE
ADMINISTRATIVE CASES AGAINST THE RESPONDENTS; AND IN
PERPETUALLY RESTRAINING THE PETITIONERS FROM HEARING AND
INVESTIGATING THE ADMINISTRATIVE CASES FILED AGAINST THE
RESPONDENTS SOLELY ON THE BASIS OF THE TOTALLY UNFOUNDED
ALLEGATIONS OF THE RESPONDENTS THAT THE PETITIONERS ARE
PARTIAL AGAINST THEM.

II.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS GRAVELY
ERRED IN FAILING TO APPRECIATE AND APPLY THE PRINCIPLE OF
EXHAUSTION OF ADMINISTRATIVE REMEDIES AND THE RULE ON NON
FORUM SHOPPING IN PERPETUALLY RESTRAINING THE PETITIONERS
FROM HEARING AND INVESTIGATING THE ADMINISTRATIVE CASES
AGAINST THE RESPONDENTS.

III.
WHETHER OR NOT THE HONORABLE COURT OF APPEALS SERIOUSLY
ERRED IN RENDERING A DECISION WHICH IS CONTRARY TO AND
COMPLETELY DISREGARDS APPLICABLE JURISPRUDENCE AND WHICH,
IN VIOLATION OF THE RULES OF COURT, DOES NOT CLEARLY STATE
THE FACTS AND THE LAW ON WHICH IT IS BASED.[16]

In the meantime, on February 27, 2003, the CSC resolved

respondents Petition to Lift Order of Preventive Suspension and
Petition to Transfer Investigation to the Commission through
Resolution No. 03-0278,[17] the dispositive portion of which reads:

WHEREFORE, the Commission hereby rules that:

1. The Urgent Petition to Lift the Order of Preventive

Suspension is hereby DENIED for having become moot
and academic.
 2. The Petition to Transfer Investigation to the
Commission is likewise DENIED for lack of merit.
Accordingly, GSIS President and General Manager
Winston F. Garcia is directed to continue the conduct
of the formal investigation of the charges against
respondents-petitioners Albert Velasco and Mario I.
Molina.[18]

As to the lifting of the order of preventive suspension, the

CSC considered the issue moot and academic considering that the
period had lapsed and respondents had been allowed to resume
their specific functions. This notwithstanding, the CSC opted to
discuss the matter by way of obiter dictum. Without making a
definitive conclusion as to the effect thereof in the case against
respondents, the CSC declared that a preliminary investigation is a
pre-requisite condition to the issuance of a formal charge.[19]

On the requested transfer of the investigation from the GSIS

to the CSC, the latter denied the same for lack of merit. The
Commission concluded that the fact that the GSIS acted as the
complainant and prosecutor and eventually the judge does not
mean that impartiality in the resolution of the case will no longer
be served.[20]

Aggrieved, respondents appealed to the CA through a

Petition for Review under Rule 43 of the Rules of Court. [21] The
case was docketed as CA-G.R. SP NO. 75973.

On December 7, 2005, the CA rendered a Decision [22] in favor

of respondents, the dispositive portion of which reads:

PREMISES CONSIDERED, the petition is hereby GRANTED. The

formal charges filed by the President and General Manager of the
 GSIS against petitioners, and necessarily, the order of preventive
suspension emanating therefrom, are declared NULL AND VOID. The
GSIS is hereby directed to pay petitioners back salaries pertaining to
the period during which they were unlawfully suspended. No
pronouncement as to costs.

SO ORDERED.[23]

The CA declared null and void respondents formal charges

for lack of the requisite preliminary investigation. In view thereof,
the CA disagreed with the CSC that the question on the propriety
of the preventive suspension order had become moot and
academic. Rather, it concluded that the same is likewise void
having emanated from the void formal charges. Consequently, the
CA found that respondents were entitled to back salaries during
the time of their illegal preventive suspension.

Hence, the present petition raising the following issues:

I.
WHETHER THE RESPONDENTS WERE FULLY ACCORDED THE
REQUISITE OPPORTUNITY TO BE HEARD, WERE IN FACT HEARD AND
BEING HEARD, AND WHETHER THE CONDUCT OF PRELIMINARY
INVESTIGATION IN ADMINISTRATIVE PROCEEDINGS IS AN ESSENTIAL
REQUISITE TO THE CONDUCT OF ADJUDICATION.

II.
WHETHER THE RESPONDENTS WAIVED THEIR RIGHT TO PRELIMINARY
INVESTIGATION.

III.
WHETHER PRELIMINARY INVESTIGATION IS REQUIRED IN
INDICTMENTS IN FLAGRANTI, AS HERE.
 IV.
WHETHER THE HONORABLE COURT OF APPEALS LACKED JURISDICTION,
AS THE ALLEGED LACK OF PRELIMNARY INVESTIGATION SHOULD
HAVE BEEN RAISED BEFORE THE GSIS AND, THEREAFTER, BEFORE THE
CIVIL SERVICE COMMISSION, UNDER THE PRINCIPLE OF EXHAUSTION
OF ADMINISTRATIVE REMEDIES; THE GSIS HAVING ACQUIRED
JURISDICTION OVER THE PERSONS OF THE RESPONDENTS, TO THE
EXCLUSION OF ALL OTHERS.

V.
WHETHER THE ALLEGED LACK OF PRELIMINARY INVESTIGATION IS A
NON-ISSUE.

VI.
WHETHER THE PREVENTIVE SUSPENSION ORDERS ISSUED AGAINST
RESPONDENTS MOLINA AND VELASCO ARE VALID, WELL-FOUNDED
AND DULY RECOGNIZED BY LAW.

VII.
WHETHER PREVENTIVE SUSPENSION IS A PENALTY AND, THUS, MAY NOT
BE IMPOSED WITHOUT BEING PRECEDED BY A HEARING.

VIII.
WHETHER THE RESPONDENTS ARE ENTITLED TO PAYMENT OF BACK
SALARIES PERTAINING TO THE PERIOD OF THEIR PREVENTIVE
SUSPENSION.

IX.
WHETHER THE INSTITUTION OF THE RESPONDENTS PETITION BEFORE
THE CIVIL SERVICE COMMISSION WAS ENTIRELY PREMATURE.

X.
WHETHER THE MISAPPREHENSIONS OF THE RESPONDENTS AS REGARDS
THE PARTIALITY OF THE GSIS COMMITTEE INVESTIGATING THE
CHARGES AGAINST THEM IS BLATANTLY WITHOUT FACTUAL BASIS.
 XI.
WHETHER RESPONDENTS OBVIOUS ACT OF FORUM SHOPPING SHOULD
BE COUNTENANCED BY THIS HONORABLE COURT.[24]

The petitions are without merit.

The civil service encompasses all branches and agencies of

the Government, including government-owned or controlled
corporations (GOCCs) with original charters, like the GSIS, or those
created by special law. As such, the employees are part of the civil
service system and are subject to the law and to the circulars,
rules and regulations issued by the CSC on discipline, attendance
and general terms and conditions of employment. [25] The CSC has
jurisdiction to hear and decide disciplinary cases against erring
employees. In addition, Section 37 (b) of Presidential Decree No.
807 or the Civil Service Decree of the Philippines also gives the
heads of departments, agencies and instrumentalities, provinces,
cities and municipalities the authority to investigate and decide
matters involving disciplinary action against officers and
employees under their jurisdiction. As for the GSIS, Section 45,
Republic Act (R.A.) 8291 otherwise known as the GSIS Act of 1997,
specifies its disciplining authority, viz:

SECTION 45. Powers and Duties of the President and General Manager.
The President and General Manager of the GSIS shall among others,
execute and administer the policies and resolutions approved by the
Board and direct and supervise the administration and operations of
the GSIS. The President and General Manager, subject to the
approval of the Board, shall appoint the personnel of the GSIS,
remove, suspend or otherwise discipline them for cause, in
accordance with existing Civil Service rules and regulations, and
prescribe their duties and qualifications to the end that only
competent persons may be employed.
By this legal provision, petitioner, as President and General Manager
of GSIS, is vested the authority and responsibility to remove,
suspend or otherwise discipline GSIS personnel for cause.[26]

However, despite the authority conferred on him by law, such power

is not without limitations for it must be exercised in accordance
with Civil Service rules. The Uniform Rules on Administrative Cases
in the Civil Service lays down the procedure to be observed in
issuing a formal charge against an erring employee, to wit:

First, the complaint. A complaint against a civil service official

or employee shall not be given due course unless it is in writing and
subscribed and sworn to by the complainant. However, in cases
initiated by the proper disciplining authority, the complaint need not
be under oath.[27] Except when otherwise provided for by law, an
administrative complaint may be filed at anytime with the
Commission, proper heads of departments, agencies, provinces,
cities, municipalities and other instrumentalities.[28]

Second, the Counter-Affidavit/Comment. Upon receipt of a

complaint which is sufficient in form and substance, the disciplining
authority shall require the person complained of to submit Counter-
Affidavit/Comment under oath within three days from receipt. [29]

Third, Preliminary Investigation. A Preliminary investigation

involves the ex parte examination of records and documents
submitted by the complainant and the person complained of, as well
as documents readily available from other government offices.
During said investigation, the parties are given the opportunity to
submit affidavits and counter-affidavits. Failure of the person
complained of to submit his counter-affidavit shall be considered as a
waiver thereof.[30]
 Fourth, Investigation Report. Within five (5) days from the
termination of the preliminary investigation, the investigating officer
shall submit the investigation report and the complete records of the
case to the disciplining authority.[31]

Fifth, Formal Charge. If a prima facie case is established during

the investigation, a formal charge shall be issued by the disciplining
authority. A formal investigation shall follow. In the absence of a
prima facie case, the complaint shall be dismissed.[32]

It is undisputed that the Memoranda separately issued to

respondents were the formal charges against them. These formal
charges contained brief statements of material or relevant facts, a
directive to answer the charges within seventy two (72) hours
from receipt thereof, an advice that they had the right to a formal
investigation and a notice that they are entitled to be assisted by a
counsel of their choice.[33]

It is likewise undisputed that the formal charges were issued without

preliminary or fact-finding investigation. Petitioner explained that
no such investigation was conducted because the CSC rules did
not specifically provide that it is a pre-requisite to the issuance of
a formal charge. He likewise claimed that preliminary investigation
was not required in indictments in flagranti as in this case.

We disagree.

Indeed, the CSC Rules does not specifically provide that a formal
charge without the requisite preliminary investigation is null and
void. However, as clearly outlined above, upon receipt of a
complaint which is sufficient in form and substance, the
disciplining authority shall require the person complained of to
submit a Counter-Affidavit/Comment under oath within three
days from receipt. The use of the word shall quite obviously
indicates that it is mandatory for the disciplining authority to
conduct a preliminary investigation or at least respondent should
be given the opportunity to comment and explain his side. As can
be gleaned from the procedure set forth above, this is done prior
to the issuance of the formal charge and the comment required
therein is different from the answer that may later be filed by
respondents. Contrary to petitioners claim, no exception is
provided for in the CSC Rules. Not even an indictment in
flagranti as claimed by petitioner.

This is true even if the complainant is the disciplining

authority himself, as in the present case. To comply with such
requirement, he could have issued a memorandum requiring
respondents to explain why no disciplinary action should be taken
against them instead of immediately issuing formal charges. With
respondents comments, petitioner would have properly evaluated
both sides of the controversy before making a conclusion that
there was a prima facie case against respondents, leading to the
issuance of the questioned formal charges. It is noteworthy that
the very acts subject of the administrative cases stemmed from an
event that took place the day before the formal charges were
issued. It appears, therefore, that the formal charges were issued
after the sole determination by the petitioner as the disciplining
authority that there was a prima facie case against respondents.

To condone this would give the disciplining authority an

unrestricted power to judge by himself the nature of the act
complained of as well as the gravity of the charges. We, therefore,
conclude that respondents were denied due process of law. Not
even the fact that the charges against them are serious and
evidence of their guilt is in the opinion of their superior strong can
compensate for the procedural shortcut undertaken by petitioner
 which is evident in the record of this case. [34] The filing by
petitioner of formal charges against the respondents without
complying with the mandated preliminary investigation or at least
give the respondents the opportunity to comment violated the
latter's right to due process. Hence, the formal charges are
void ab initio and may be assailed directly or indirectly at anytime.
[35]

The cardinal precept is that where there is a violation of basic

constitutional rights, courts are ousted from their jurisdiction. The
violation of a party's right to due process raises a serious
jurisdictional issue which cannot be glossed over or disregarded at
will. Where the denial of the fundamental right to due process is
apparent, a decision rendered in disregard of that right is void for
lack of jurisdiction. This rule is equally true in quasi-judicial and
administrative proceedings, for the constitutional guarantee that
no man shall be deprived of life, liberty, or property without due
process is unqualified by the type of proceedings (whether judicial
or administrative) where he stands to lose the same.[36]

Although administrative procedural rules are less stringent and often

applied more liberally, administrative proceedings are not exempt
from basic and fundamental procedural principles, such as the
right to due process in investigations and hearings. [37] In particular,
due process in administrative proceedings has been recognized to
include the following: (1) the right to actual or constructive notice
to the institution of proceedings which may affect a respondent's
legal rights; (2) a real opportunity to be heard personally or with
the assistance of counsel, to present witnesses and evidence in
one's favor, and to defend one's rights; (3) a tribunal vested with
competent jurisdiction and so constituted as to afford a person
charged administratively a reasonable guarantee of honesty as
well as impartiality; and (4) a finding by said tribunal which is
 supported by substantial evidence submitted for consideration
during the hearing or contained in the records or made known to
the parties affected.[38]

Petitioner contends that respondents waived their right to

preliminary investigation as they failed to raise it before the GSIS.

Again, we do not agree.

It is well-settled that a decision rendered without due

process is void ab initio and may be attacked at anytime directly or
collaterally by means of a separate action, or by resisting such
decision in any action or proceeding where it is invoked.
[39]
Moreover, while respondents failed to raise before the GSIS the
lack of preliminary investigation, records show that in their Urgent
Motion to Resolve (their Motion to Lift Preventive Suspension
Order) filed with the CSC, respondents questioned the validity of
their preventive suspension and the formal charges against them
for lack of preliminary investigation.[40] There is, thus, no waiver to
speak of.

In the procedure adopted by petitioner, respondents were

preventively suspended in the same formal charges issued by the
former without the latter knowing that there were pending
administrative cases against them. It is true that prior notice and
hearing are not required in the issuance of a preventive
suspension order.[41] However, considering that respondents were
preventively suspended in the same formal charges that we now
declare null and void, then their preventive suspension is likewise
null and void.

Lastly, the CA committed no reversible error in ordering the

payment of back salaries during the period of respondents
 preventive suspension. As the administrative proceedings involved
in this case are void, no delinquency or misconduct may be
imputed to respondents and the preventive suspension meted
them is baseless. Consequently, respondents should be awarded
their salaries during the period of their unjustified suspension.
[42]
In granting their back salaries, we are simply repairing the
damage that was unduly caused respondents, and unless we can
turn back the hands of time, we can do so only by restoring to
them that which is physically feasible to do under the
circumstances.[43] The principle of no work, no pay does not apply
where the employee himself was unlawfully forced out of job. [44]

In view of the foregoing disquisition, we find no necessity to

discuss the other issues raised by petitioner.

WHEREFORE, premises considered, the petition in G.R. No.

157383 is DENIED while the petition in G.R. No. 174137
is DISMISSED, for lack of merit.

SO ORDERED.

ANTONIO EDUARDO B. NACHURA

Associate Justice

WE CONCUR:

RENATO C. CORONA
Chief Justice
 ANTONIO T. CARPIO CONCHITA CARPIO MORALES
Associate Justice Associate Justice

(On Official Leave)

PRESBITERO J. VELASCO, JR. TERESITA J. LEONARDO-DE
Associate Justice CASTRO
Associate Justice

ARTURO D. BRION
DIOSDADO M. PERALTA
Associate Justice
Associate Justice

LUCAS P. BERSAMIN MARIANO C. DEL CASTILLO

Associate Justice Associate Justice

ROBERTO A. ABAD MARTIN S. VILLARAMA, JR.

Associate Justice Associate Justice
JOSE PORTUGAL PEREZ JOSE CATRAL MENDOZA
Associate Justice Associate Justice

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution, I certify that

the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the
opinion of the Court.

RENATO C. CORONA
Chief Justice