CASE DIGEST: NED v. Villanueva

G.R. No. 168203 : March 9, 2010




Respondent was an elected member of the Board of Directors (BOD) of Agusan del Norte Electric Cooperative (ANECO) for a term of three years, from 2001 to 2003. However, with the subsequent redistricting of the area he represented, his term was extended until 2006.

In 2002, while serving as a member of the ANECO BOD, he was elected asBarangayChairman ofBarangay12, in theMunicipalityofCabadbaran, Agusan del Norte.Thereafter, he was also elected as President of Liga ng mga Barangay(Liga), of Cabadbaran.By virtue of his position as Liga President, he sat asex-officiomember of theSangguniang Bayanof Cabadbaran.

Subsequently, the General Manager of ANECO sought the opinion of herein petitioner as to whether or not respondent is still qualified to sit as member of the ANECO BOD.

In response to such query, the NEA Director for Co-Op Operations held that respondent could no longer serve as a member of the ANECO BOD, because he was considered automatically resigned from the said position when he took his oath of office as Liga President.As basis of its opinion, the NEA Director for Co-Op Operations citedas authority the Local Government Code of 1991, NEA Memorandum dated February 13, 1998, and the Guidelines in the Conduct of Electric Cooperative District Elections.

Respondent sought the opinion of the DILG Provincial Director of the relative to his disqualification as a member of the ANECO BOD. In response, the DILG Provincial Director gave the view that his office could not issue an official opinion on the matter being sought, considering that another agency had jurisdiction over it. Nonetheless, he stated the view that respondent was not a regular member of the Sangguniang Bayan; instead, he occupied the office only in anex-officiocapacity, because he was not duly elected thereto by the registered voters of Cabadbaran, but occupied the said position only by reason of his being the president of the Liga.

On January 31, 2003, respondent requested review and reconsideration of the disputed opinion of the NEA Director for Co-Op Operations, but the same was denied.

Aggrieved, respondent filed with the RTC of Cabadbaran, Agusan del Norte, a petition for certiorari with prayer for preliminary injunction against NEA and ANECO. The RTC issued a TRO enjoining NEA and ANECO and their representatives, attorneys and agents from disqualifying respondent as member of the ANECO BOD or allowing him to continue attending meetings or sessions of the said BOD and granting him back all benefits, emoluments and remunerations due him on account of his disqualification.

NEAand ANECO filed separate motions for reconsideration but both motions were denied. Consequently, onFebruary 10, 2004, the RTC issued a Writ of Preliminary Injunction. Subsequently, the RTC made the injunction permanent. NEA filed a motion for reconsideration, but the RTC denied it.


Whether or not respondent can no longer be a member of the ANECO BOD after becoming anex-officiomember of theSangguniang Bayanof Cabadbaran?


The petition is granted.

POLITICAL LAW: qualification of board of directors

Section 7 (8), Article II of the Guidelines in the Conduct of Electric Cooperative District Elections issued by the NEA Main Office, through its Board of Administrators, on June 23, 1993, provides that bona fidemembers who possess the following qualifications are eligible to become and/or to remain as member of Board of Directors: (1) He/she is a Filipino citizen x x x x (8) He/she does not hold elective office in the government nor appointed to an elective position above the level of a Barangay Captain.

In the case Salomon v. National Electrification Administration (251 Phil. 459, 1989), the petitioner, an elected Barangay Captain, sought the nullification of a ruling issued by the NEA which disqualified her from further acting as a member of the Board of Directors of La Union Electric Cooperative, Inc. (LUELCO) by reason of the fact that she was appointed as an ex-officio member of theSangguniang Panlalawiganof La Union, representing the barangay officials of the province. This Court upheld the disqualification of therein petitioner as a member of the Board of Directors.

The Court finds that, while the position to which the petitioner in the above-quoted ruling was appointed is different from the position to which herein respondent was named, the rule or principle enunciated above, nonetheless, applies squarely to the present case. Consequently, and in consonance with the Guidelines and Memorandum issued by the NEA, when respondent was designated as member of the Sangguniang Bayan of Cabadbaran, he became ineligible, and was thereby disqualified as member of the ANECO BOD.

REMEDIAL LAW: exhaustion of administrative remedies

Respondent should have first exhausted the administrative remedies still available to him by appealing the challenged order of the NEA to the Office of the President, which exercises the power of supervision over it in accordance withSection 13, Chapter II of Presidential Decree No. 269.

Considering that the President has the power to review on appeal the orders or acts of petitioner NEA, the failure of respondent to undertake such an appeal bars him from resorting to a judicial suit. It is settled that under the doctrine of exhaustion of administrative remedies, recourse through court action cannot prosper until after all such administrative remedies have first been exhausted. If remedy is available within the administrative machinery, this should be resorted to before recourse can be made to courts. The party with an administrative remedy must not only initiate the prescribed administrative procedure to obtain relief but also pursue it to its appropriate conclusion before seeking judicial intervention in order to give the administrative agency an opportunity to decide the matter itself correctly and prevent unnecessary and premature resort to the court. The non-observance of the doctrine of exhaustion of administrative remedies results in lack of cause of action, which is one of the grounds in the Rules of Court justifying the dismissal of the complaint.

In the present case, respondent failed to exhaust his administrative remedies when he filed a case with the RTC without appealing the decision of the NEA to the Office of the President.As such, his petition filed with the RTC must necessarily fail.

REMEDIAL LAW: validity of temporary restraining order

It is settled that under Section 5, Rule 58 of the Rules of Court, a judge may issue a temporary restraining order within a limited life of twenty (20) days from date of issue.If before the expiration of the twenty (20)-day period the application for preliminary injunction is denied, the temporary restraining order would be deemed automatically vacated.If no action is taken by the judge on the application for preliminary injunction within the said twenty (20) days, the temporary restraining order would automatically expire on the 20th day by the sheer force of law, no judicial declaration to that effect being necessary and the courts having no discretion to extend the same.The rule against the non-extendibility of the twenty (20)-day limited period of effectivity of a temporary restraining order is absolute if issued by a regional trial court.Hence, the RTC committed error when it ruled that the temporary restraining order it issued on December 2, 2003 was effective until January 5, 2004, a periodthat wasbeyond the twenty (20) days allowed under the Rules of Court.This does not mean, however, that the entire TRO was invalidated. The same remained valid and in effect,but only within the20-day period, after which it automatically expired.

The decision and resolution of the RTC are reversed and set aside.