G.R. No. 131082. June 19, 2000.

* shall be given to both the conjunctive “and” and the disjunctive “or”;
ROMULO, MABANTA, BUENAVENTURA, SAYOC & DE or that
LOS ANGELES, petitioner, vs. HOME DEVELOPMENT
_______________
MUTUAL FUND, respondent.
Pag-IBIG Fund; Section 1 of Rule VII of the Amendments to  FIRST DIVISION.
*

the Rules and Regulations Implementing Republic Act No. 7742, and 778
Home Development Mutual Fund Circular No. 124-B prescribing 778 SUPREME
the Revised Guidelines and Procedure for Filing Application for COURT REPORTS
Waiver or Suspension of Fund Coverage under Presidential Decree
No. 1752, as amended by Republic Act No. 7742, are null and void
ANNOTATED
insofar as they require that an employer should have both a Romulo, Mabanta,
provident/retirement plan and a housing plan superior to the Buenaventura, Sayoc & De
benefits offered by the Fund in order to qualify for waiver or los Angeles vs. Home
suspension of the Fund coverage.—The issue of the validity of the Development Mutual Fund
1995 Amendments to the Rules and Regulations Implementing R.A. one word or the other may be taken accordingly as one or the
No. 7742, specifically Section I, Rule VII on Waiver and other will best effectuate the purpose intended by the legislature as
Suspension, has been squarely resolved in the relatively recent case gathered from the whole statute. The term is used to avoid a
of China Banking Corp. v. The Members of the Board of Trustees of construction which by the use of the disjunctive “or” alone will
the HDMF. We held in that case that Section 1 of Rule VII of the exclude the combination of several of the alternatives or by the use
Amendments to the Rules and Regulations Implementing R.A. No. of the conjunctive “and” will exclude the efficacy of any one of the
7742, and HDMF Circular No. 124-B prescribing the Revised alternatives standing alone.” It is accordingly ordinarily held that the
Guidelines and Procedure for Filing Application for Waiver or intention of the legislature in using the term “and/or” is that the word
Suspension of Fund Coverage under P.D. No. 1752, as amended by “and” and the word “or” are to be used interchangeably.
R.A. No. 7742, are null and void insofar as they require that an Administrative Law; It is well-settled that rules and
employer should have both a provident/retirement plan and a housing regulations, which are the product of a delegated power to create
plan superior to the benefits offered by the Fund in order to qualify new and additional legal provisions that have the effect of law,
for waiver or suspension of the Fund coverage. should be within the scope of the statutory authority granted by the
Statutory Construction; It is ordinarily held that the intention legislature to the administrative agency.—It is without doubt that the
of the legislature in using the term “and/or” is that the word “and” HDMF Board has rule-making power as provided in Section 5 of
and the word “or” are to be used interchangeably.—In arriving at R.A. No. 7742 and Section 13 of P.D. No. 1752. However, it is well-
said conclusion, we ruled: The controversy lies in the legal settled that rules and regulations, which are the product of a
signification of the words “and/or.” In the instant case, the legal delegated power to create new and additional legal provisions that
meaning of the words “and/or” should be taken in its ordinary have the effect of law, should be within the scope of the statutory
signification, i.e., “either and or; e.g. butter and/or eggs means butter authority granted by the legislature to the administrative agency. It is
and eggs or butter or eggs. “The term ‘and/or’ means that the effect required that the regulation be germane to the objects and purposes

1|Page
of the law, and be not in contradiction to, but in conformity with, the Development Mutual Fund in its pursuit of promoting public welfare
standards prescribed by law. through ample social services as mandated by the Constitution, we
Same; Home Development Mutual Fund (HDMF); The Home are of the opinion that the basic law should prevail. A department
Development Mutual Fund cannot, in the exercise of its rule-making zeal may not be permitted to outrun the authority conferred by the
power, issue a regulation not consistent with the law it seeks to statute.
apply—administrative issuances must not override, supplant or
modify the law, but must remain consistent with the law they intend PETITION for review on certiorari of a decision of the Court
to carry out.—In the present case, when the Board of Trustees of the of Appeals.
HDMF required in Section 1, Rule VII of the 1995 Amendments to
the Rules and Regulations Implementing R.A. No. 7742 that The facts are stated in the opinion of the Court.
employers should have both provident/retirement and housing      Romulo, Mabanta, Buenaventura,  Sayoc & Delos
benefits for all its employees in order to qualify for exemption from Angeles for and in its own behalf.
the Fund, it effectively amended Section 19 of P.D. No. 1752. And      Cristobal A. Paralejas for respondent.
when the Board subsequently abolished that exemption through the
1996 Amendments, it repealed Section 19 of P.D. No. 1752. Such
DAVIDE, JR., C.J.:
amendment and subsequent repeal of Section 19 are both invalid, as
they are not within the delegated power of the Board. The HDMF
Once again, this Court is confronted with the issue of the
cannot, in the exercise of its rule-making power, issue a regulation
not consistent with the law it seeks to apply. Indeed, administrative validity of the Amendments to the Rules and Regulations
issuances must not Implementing Republic Act No. 7742, which require the
779 existence of a plan providing for both provident/retirement and
VOL. 333, 779 housing benefits for exemption from the Pag-IBIG Fund
JUNE 19, 2000 coverage under Presidential Decree No. 1752, as amended.
Romulo, Mabanta, Pursuant to Section 19  of P.D. No. 1752, as amended by
1

R.A. No. 7742, petitioner Romulo, Mabanta, Buenaventura,

Buenaventura, Sayoc & De
los Angeles vs. Home _______________
Development Mutual Fund
override, supplant or modify the law, but must remain
1
 It reads:
SEC. 19. Existing Provident/Housing Plan—An employer and/or employee-
consistent with the law they intend to carry out. Only Congress can
group who, at the time this Decree becomes effective have their own provident
repeal or amend the law. and/or employee-housing
Same; Same; A departmental zeal may not be permitted to 780
outrun the authority conferred by the statute.—While it may be 780 SUPREME COURT
conceded that the requirement of having both plans to qualify for an
exemption, as well as the abolition of the exemption, would enhance
REPORTS
the interest of the working group and further strengthen the Home ANNOTATED

2|Page
 Romulo, Mabanta, The establishment of a separate provident and/or housing plan after the
effectivity of this Decree shall not be a ground for waiver of coverage in the
Buenaventura, Sayoc & De Fund; nor shall such coverage bar any employer and/or employee-group from
los Angeles vs. Home establishing separate provident and/or housing plans.
 Rollo, 43.
Development Mutual Fund
2

3
 Id., 187.
Sayoc and De Los Angeles (hereafter PETITIONER), a law 4
 Id., 44.
firm, was exempted for the period 1 January to 31 December 781
1995 from the Pag-IBIG Fund coverage by respondent Home VOL. 333, JUNE 19, 781
Development Mutual Fund (hereafter HDMF) because of a 2000
superior retirement plan. 2
Romulo, Mabanta,
On 1 September 1995, the HDMF Board of Trustees, Buenaventura, Sayoc & De
pursuant to Section 5 of Republic Act No. 7742, issued Board los Angeles vs. Home
Resolution No. 1011, Series of 1995, amending and modifying
Development Mutual Fund
the Rules and Regulations Implementing R.A. No. 7742. As
letter explaining that the 1995 Amendments to the Rules are
amended, Section 1 of Rule VII provides that for a company to
invalid. 5

be entitled to a waiver or suspension of Fund coverage,  it must 3

In a letter dated 18 March 1996, the President and Chief

have a plan providing for both
Executive Officer of HDMF disapproved PETITIONER’S
provident/retirement and housing benefits superior to those
application on the ground that the requirement that there should
provided under the PagIBIG Fund.
be both a provident retirement fund and a housing plan is clear
On 16 November 1995, PETITIONER filed with the
in the use of the phrase “and/or,” and that the Rules
respondent an application for Waiver or Suspension of Fund
Implementing R.A. No. 7742 did not amend nor repeal Section
Coverage because of its superior retirement plan.  In support of
4

19 of P.D. No. 1752 but merely implement the law. 6

said application, PETITIONER submitted to the HDMF a

PETITIONER’S appeal  with the HDMF Board of Trustees
7

_______________ was denied for having been rendered moot and academic by
Board Resolution No. 1208, Series of 1996, removing the
plans, may register with the Fund, for any of the following purposes: availment of waiver of the mandatory coverage of the PagIBIG
Fund, except for distressed employers. 8

1. (a)For annual certification of waiver or suspension from coverage or

participation in the Fund, which shall be granted on the basis of
On 31 March 1997, PETITIONER filed a petition for
verification that the waiver or suspension does not contravene any review  before the Court of Appeals. On motion by HDMF, the
9

effective collective bargaining agreement and that the features of the Court of Appeals dismissed  the petition on the ground that the
10

plan or plans are superior to the Fund or continue to be so; or coverage of employers and employees under the Home
2. (b)For integration with the Fund, either fully or partially.
Development Mutual Fund is mandatory in character as clearly
worded in Section 4 of P.D. No. 1752, as amended by R.A. No.

3|Page
7742. There is no allegation that petitioner is a distressed thereof, PETITIONER contends that the subject 1995
employer to warrant its exemption from the Fund coverage. As Amendments issued by HDMF are inconsistent with the
to the amendments to the Rules and Regulations Implementing enabling law, P.D. No. 1752, as amended by R.A. No. 7742,
R.A. No. 7742, the same are valid. Under P.D. No. 1752 and which merely requires as a pre-condition for exemption from
R.A. No. 7742 the Board of Trustees of the HDMF is coverage the existence of either a superior provident/retirement
authorized to promulgate rules and regulations, as well as plan or a superior housing plan, and not the concurrence of
amendments thereto, concerning the extension, waiver or both plans. Hence, considering that PETITIONER has a
suspension of coverage under the Pag-IBIG Fund. And the provident plan superior to that offered by the HDMF, it is
publication requirement was amply met, since the questioned entitled to exemption from the coverage in accordance with
amendments were published in the 21 October 1995 issue of Section 19 of P.D. No. 1752. The 1996 Amendment are also
void insofar as they abolished the exemption granted by
_______________ Section 19 of P.D. 1752, as amended. The repeal of such
5
 Id., 45-51
exemption involves the exercise of legislative power, which
6
 Id., 52-54. cannot be delegated to HMDF.
7
 Id., 55-60. PETITIONER also cites Section 9 (1), Chapter 2, Book VII
8
 Rollo, 61. of the Administrative Code of 1987, which provides:
9
 Id., 30-42.
SEC. 9. Public Participation—(1) If not otherwise required by law,
10
 Id., 86-91. Per Tayao-Jaguros, L. J., with Martinez, A. and Brawner,
R. JJ., concurring. an agency shall, as far as practicable, publish or circulate notices of
782 proposed rules and afford interested parties the opportunity to submit
782 SUPREME COURT their views prior to the adoption of any rule.
REPORTS Since the Amendments to the Rules and Regulations
Implementing Republic Act No. 7742 involve an imposition of
ANNOTATED
an additional burden, a public hearing should have first been
Romulo, Mabanta, conducted to give chance to the employers, like PETITIONER,
Buenaventura, Sayoc & De to be heard before the HDMF adopted the said Amendments.
los Angeles vs. Home Absent such public hearing, the amendments should be voided.
Development Mutual Fund
the Philippine Star, which is a newspaper of general _______________
circulation.  Id., 112-126.
11

PETITIONER’S motion for reconsideration  was 11

 Id., 140.
12

denied.  Hence, on 6 November 1997, PETITIONER filed a

12
783
petition before this Court assailing the 1995 and the 1996 VOL. 333, JUNE 19, 783
Amendments to the Rules and Regulations Implementing 2000
Republic Act No. 7742 for being contrary to law. In support

4|Page
 Romulo, Mabanta, 1996,  respectively, HDMF has complied with the publication
14

Buenaventura, Sayoc & De requirement.

los Angeles vs. Home Finally, HDMF claims that as early as 18 October 1996, it
Development Mutual Fund had already filed certified true copies of the Amendments to
the Rules and Regulations with the University of the
Finally, PETITIONER contends that HDMF did not comply
Philippines Law Center. This fact is evidenced by certified true
with Section 3, Chapter 2, Book VII of the Administrative
Code of 1987, which provides that “[e]very agency shall file _______________
with the University of the Philippines Law Center three (3)
certified copies of every rule adopted by it.”  Rollo, 187.
13

On the other hand, the HDMF contends that in  Id., 188.

14

784
promulgating the amendments to the rules and regulations
which require the existence of a plan providing for both 784 SUPREME COURT
provident and housing benefits for exemption from the Fund REPORTS
Coverage, the respondent Board was merely exercising its rule- ANNOTATED
making power under Section 13 of P.D. No. 1752. It had the Romulo, Mabanta,
option to use “and” only instead of “or” in the rules on waiver Buenaventura, Sayoc & De
in order to effectively implement the Pag-IBIG Fund Law. By los Angeles vs. Home
choosing “and,” the Board has clarified the confusion brought Development Mutual Fund
about by the use of “and/or” in Section 19 of P.D. No. 1752, as copies of the Certification from the Office of the National
amended. Administrative Register of the U.P. Law Center. 15

As to the public hearing, HDMF maintains that as can be We find for the PETITIONER.
clearly deduced from Section 9(1), Chapter 2, book VII of the The issue of the validity of the 1995 Amendments to the
Revised Administrative Code of 1987, public hearing is Rules and Regulations Implementing R.A. No. 7742,
required only when the law so provides, and if not, only if the specifically Section I, Rule VII on Waiver and Suspension, has
same is practicable. It follows that public hearing is only been squarely resolved in the relatively recent case of China
optional or discretionary on the part of the agency concerned, Banking Corp. v. The Members of the Board of Trustees of the
except when the same is required by law. P.D. No. 1752 does HDMF.  We held in that case that Section 1 of Rule VII of the
16

not require that public hearing be first conducted before the Amendments to the Rules and Regulations Implementing R.A.
rules and regulations implementing it would become valid and No. 7742, and HDMF Circular No. 124-B prescribing the
effective. What it requires is the publication of said rules and Revised Guidelines and Procedure for Filing Application for
regulations at least once in a newspaper of general circulation. Waiver or Suspension of Fund Coverage under P.D. No. 1752,
Having published said 1995 and 1996 Amendments through as amended by R.A. No. 7742, are null and void insofar as they
the Philippine Star on 21 October 1995  and 15 November
13
require that an employer should have both a

5|Page
provident/retirement plan and a housing plan superior to the plan and a housing plan in order to qualify for exemption, it would
benefits offered by the Fund in order to qualify for waiver or have used the words “and” instead of “and/or.” Notably, paragraph
suspension of the Fund coverage. In arriving at said (a) of Section 19 requires for annual certification of waiver or
conclusion, we ruled: suspension, that the features of the plan or plans are superior to the
The controversy lies in the legal signification of the words “and/or.” fund or continue to be so. The law obviously contemplates that the
In the instant case, the legal meaning of the words “and/or” existence of either plan is considered as sufficient basis for the grant
should be taken in its ordinary signification, i.e., “either and of an exemption; needless to state, the concurrence of both plans is
or; e.g. butter and/or eggs means butter and eggs or butter or eggs. more than sufficient. To require the existence of both plans would
“The term ‘and/or’ means that the effect shall be given to both the radically impose a more stringent condition for waiver which was
conjunctive “and” and the disjunctive “or”; or that one word or the other not clearly envisioned by the basic law. By removing the disjunctive
may be taken accordingly as one or the other will best effectuate the word “or” in the implementing rules the respondent Board has
purpose intended by the legislature as gathered from the whole statute. The exceeded its authority.
term is used to avoid a construction which by the use of the disjunctive “or” It is without doubt that the HDMF Board has rule-making
alone will exclude the combination of several of the alternatives or by the power as provided in Section 5  of R.A. No. 7742 and Section
17

use of the conjunctive “and” will exclude the efficacy of any one of the
alternatives standing alone.”
13  of P.D. No. 1752. However, it is well-settled that rules
18

_______________ _______________

15
 Id., 189.  SEC. 5. Promulgation of Rules and Regulations.—Within sixty (60) days
17

16
 G.R. No. 131787, 19 May 1999, 307 SCRA 443. from the approval of this Act, the Board of Trustees of the Home Development
785 Mutual Fund shall promulgate the rules and regulations necessary for the
effective implementation of this Act.
VOL. 333, JUNE 19, 785  SEC. 13. Rule-Making Power.—The Board of Trustees is hereby
18

2000 authorized to make and change needful rules and regulations, which shall be
published in accordance with law or at least once in a newspaper of general
Romulo, Mabanta, circulation in the Philippines, to provide for, but not limited to, the following
Buenaventura, Sayoc & De matters:
los Angeles vs. Home ...
(b) Extension of fund coverage to other working groups, and waiver or suspension of
Development Mutual Fund coverage or its enforcement for reasons herein stated;
It is accordingly ordinarily held that the intention of the ...
legislature in using the term “and/or” is that the word “and” and the 786
word “or” are to be used interchangeably. 786 SUPREME COURT
It. . . seems to us clear from the language of the enabling law that REPORTS
Section 19 of P.D. No. 1752 intended that an employer with a ANNOTATED
provident plan or an employee housing plan superior to that of the Romulo, Mabanta,
fund may obtain exemption from coverage. If the law had intended
that the employee [sic] should have both a superior provident Buenaventura, Sayoc & De

6|Page
 los Angeles vs. Home  Victorias Milling Co., Inc., v. Social Security Commission, 114 Phil. 555,
19

558 (1962), as cited in the case of China Banking Corp. v. The Members of the
Development Mutual Fund Board of Trustees, supra note 16.
and regulations, which are the product of a delegated power to  The Conference of Maritime Manning Agencies, Inc. v. Philippine
20

create new and additional legal provisions that have the effect Overseas Employment Administration, 243 SCRA 666, 675 (1995).
 Commissioner of Internal Revenue v. Court of Appeals, 240 SCRA 368,
21

of law, should be within the scope of the statutory authority 372 (1994).
granted by the legislature to the administrative agency.  It is 19
787
required that the regulation be germane to the objects and VOL. 333, JUNE 19, 787
purposes of the law, and be not in contradiction to, but in 2000
conformity with, the standards prescribed by law. 20

Romulo, Mabanta,
In the present case, when the Board of Trustees of the
Buenaventura, Sayoc & De
HDMF required in Section 1, Rule VII of the 1995
Amendments to the Rules and Regulations Implementing R.A. los Angeles vs. Home
No. 7742 that employers should have both Development Mutual Fund
provident/retirement and housing benefits for all its employees group and further strengthen the Home Development Mutual
in order to qualify for exemption from the Fund, it effectively Fund in its pursuit of promoting public welfare through ample
amended Section 19 of P.D. No. 1752. And when the Board social services as mandated by the Constitution, we are of the
subsequently abolished that exemption through the 1996 opinion that the basic law should prevail. A department zeal
Amendments, it repealed Section 19 of P.D. No. 1752. Such may not be permitted to outrun the authority conferred by the
amendment and subsequent repeal of Section 19 are both statute. 22

invalid, as they are not within the delegated power of the Considering the foregoing conclusions, it is unnecessary to
Board. The HDMF cannot, in the exercise of its rule-making dwell on the other issues raised.
power, issue a regulation not consistent with the law it seeks to WHEREFORE, the petition is GRANTED. The assailed
apply. Indeed, administrative issuances must not override, decision of 31 July 1997 of the Court of Appeals in CA-G.R.
supplant or modify the law, but must remain consistent with No. SP-43668 and its Resolution of 15 October 1997 are
the law they intend to carry out.  Only Congress can repeal or
21 hereby REVERSED and SET ASIDE. The disapproval by the
amend the law. Home Development Mutual Fund of the application of the
While it may be conceded that the requirement of having petitioner for waiver or suspension of Fund coverage is SET
both plans to qualify for an exemption, as well as the abolition ASIDE, and the Home Development Mutual Fund is hereby
of the exemption, would enhance the interest of the working directed to refund to petitioner all sums of money it collected
from the latter.
_______________ SO ORDERED.
     Puno, Kapunan and Ynares-Santiago, JJ., concur.
(i) Other matters that, by express or implied provisions of this Act, shall
     Pardo, J., No part. Related to a party.
require implementation by appropriate policies, rules and regulations.

7|Page
 Petition granted, judgment and resolution reversed and set © Copyright 2020 Central Book Supply, Inc. All rights reserved
aside.
Notes.—If the governing or enabling statute is quite
detailed and specific to begin with, there would be very little
need (or occasion) for implementing administrative
regulations. It is, however, precisely the inability of legislative
bodies to anticipate all (or many) possible detailed situations in
respect of any relatively complex subject matter, that makes
subordinate, delegated rule-making by administrative agencies
so important and unavoidable. All that may be reasonably
demanded is a showing that the delegated legislation con-
_______________

 Radio Communications of the Philippines v. Santiago, 58 SCRA 493, 498

22

(1974).
788
78 SUPREME COURT
8 REPORTS
ANNOTATED
PGA Brotherhood
Association vs. NLRC
sisting of administrative regulations are germane to the general
purposes projected by the governing or enabling statute.
(Rabor vs. Civil Service Commission, 244 SCRA 614 [1995])
It is well settled that the rules and regulations which are the
product of a delegated power to create new or additional legal
provisions that have the effect of law, should be within the
scope of the statutory authority granted by the legislature to the
administrative agency. (China Banking Corporation vs.
Members of the Board of Trustees, Home Development Mutual
Fund, 307 SCRA 443 [1999])

——o0o——

8|Page