FACTS:

The case involves a petition for review seeking the reversal of the Court of Appeals (CA) decision denying the petition for certiorari and prohibition of Metropolitan Bank and Trust Company, Inc. The Regional Tripartite Wages and Productivity Board, Region II, Tuguegarao, Cagayan (RTWPB) issued Wage Order No. R02-03, granting an across-the-board increase of P15.00 daily to all employees/workers in the private sector throughout Region II. The Wage Order was published on December 2, 1995, and took effect on January 1, 1996.

Petitioner, a member-bank of the Bankers' Council for Personnel Management (BCPM), sought for exemption from the Wage Order since it pays more than the prevailing minimum wage rate in the National Capital Region (NCR). The National Wages and Productivity Commission (NWPC) stated that the member-banks of BCPM are covered by the Wage Order. Petitioner then sought interpretation from the NWPC and the RTWPB clarified that the Wage Order covers all private establishments in Region II, regardless of the adoption of wage orders in Metro Manila. Petitioner filed a petition for certiorari and prohibition with the CA seeking nullification of the Wage Order on various grounds. The CA denied the petition, stating that certiorari is improper since the Wage Order was issued in the exercise of an administrative function, and that the letter-query did not present justiciable controversies ripe for consideration.

The petitioner raises two issues for resolution: (1) whether the Wage Order is void and of no legal effect, and (2) whether the petitioner's petition for certiorari and prohibition with the Court of Appeals (CA) was proper.

On the first issue, the petitioner argues that the RTWPB exceeded its authority in issuing the Wage Order, as it is only authorized to determine and fix the minimum wage rate within its jurisdiction for employees who do not earn the prescribed minimum wage. The petitioner also contends that the Wage Order is an unreasonable intrusion into its property rights, undermines collective bargaining, and fails to consider the rationale for a unified wage structure.

As to the second issue, the petitioner claims that it properly resorted to a petition for certiorari and prohibition since ultra vires acts of administrative agencies can be corrected through these remedies. The petitioner argues that even if it did not observe the proper remedial procedure in challenging the Wage Order, certiorari and prohibition remain available based on grounds of justice and equity. The petitioner asserts that its failure to comply with procedural rules cannot validate the manner in which the Wage Order was issued.

The respondents counter that the petition is fatally defective as no appeal from the Wage Order was filed by the petitioner. They argue that the petitioner's letter-query to the NWPC is not considered an appeal as contemplated by law, and that the validity of the Wage Order was never raised before the respondents. The respondents also contend that the implementation of the Wage Order had already been completed, rendering a prohibition action moot. They assert that even if the petitioner's procedural lapses are disregarded, the Wage Order was issued in accordance with the mandate of the law and the Court's pronouncements in a previous case. The respondents argue that the Wage Order does not intrude on property rights, recognizes the right to collective bargaining, and did not result in wage distortion.

The Court states that it will first dispose of the procedural matter relating to the petitioner's recourse to the CA before addressing the substantive issue on the validity of the Wage Order. It explains the essential requisites for a writ of certiorari and prohibition, emphasizing that these remedies are available only if there is no appeal or other plain, speedy, and adequate remedy in the ordinary course of law. The Court defines judicial, quasi-judicial, and ministerial functions, stating that the RTWPB's issuance of the Wage Order was in the nature of subordinate legislation and exercised quasi-legislative power. The Court concludes that certiorari and prohibition are not appropriate remedies in this case because there are available appeals and other adequate remedies.

The case involves a Wage Order that was issued and published on December 2, 1995. Section 13 of the Wage Order states that any party aggrieved by the Order may file an appeal with the NWPC through the RTWPB within 10 days from the publication. However, the petitioner in this case did not avail of this remedy and did not file an appeal within the given timeframe. Instead, the petitioner filed a letter-inquiry seven months later, on July 24, 1996, seeking clarification on the application of the Wage Order. It is important to note that the letter-inquiry is not considered an appeal.

ISSUES:

1. Whether the petitioner availed of the remedy provided by law before filing the petition for certiorari and prohibition.

2. Whether the National Wages and Productivity Commission (NWPC) should be impleaded as a party-respondent in the petition.

3. Whether the court should proceed to resolve the substantial issues in the present petition despite the availability of the remedy provided by law.

4. Whether or not the Regional Tripartite Wages and Productivity Board (RTWPB) exceeded its authority in granting an across-the-board wage increase to all employees and workers of Region 2, including those already receiving more than the prevailing minimum wage rate.

5. Whether or not the Wage Order is void for being ultra vires and unreasonable.

6. Whether or not the employees who received the wage increase mandated by the Wage Order need to refund the wage increase.

7. Whether or not the other payments received by the employees, such as hazard duty pay and birthday cash gift, need to be refunded.

RULING:

1. No, the petitioner did not avail of the remedy provided by law. The petitioner did not file an appeal with the NWPC within 10 days from the publication of the Wage Order. Instead, the petitioner filed a letter-inquiry seeking clarification, which is not considered an appeal.

2. No, impleading the NWPC as a party-respondent is improper. The petitioner failed to invoke the power of the NWPC to review regional wage levels set by the Regional Tripartite Wages and Productivity Boards (RTWPB).

3. Yes, the court will proceed to resolve the substantial issues in the present petition. The court has the discretion to accept a petition for certiorari or prohibition, and rules of procedure should be flexible to promote the administration of justice.

4. Yes, the RTWPB exceeded its authority in granting an across-the-board wage increase to all employees and workers of Region 2, including those already receiving more than the prevailing minimum wage rate. The Wage Order extended the coverage of the wage increase without a denominated salary ceiling and granted additional benefits not contemplated by R.A. No. 6727.

5. Section 1 of the Wage Order is void insofar as it grants a wage increase to employees earning more than the minimum wage rate. However, it is declared valid with respect to employees earning the prevailing minimum wage rate. The daily minimum wage rates in Region II were set prior to the Wage Order, and only employees earning those rates are entitled to the mandated increase.

6. The employees who received the wage increase mandated by the Wage Order do not need to refund the wage increase. The Court held that the employees received the wage increase in good faith, believing that they were entitled to it, and without knowledge that there was no legal basis for the increase. Thus, there is no requirement for them to refund the wage increase.

7. The other payments, such as hazard duty pay and birthday cash gift, received by the employees also do not need to be refunded. The Court ruled that the employees received these benefits in good faith, under the honest belief that they were authorized by relevant regulations. At the time of receipt, the employees had no knowledge that these payments were without legal basis. Therefore, there is no obligation for them to refund these benefits.

PRINCIPLES:

• The doctrine of non-delegation of powers flowing from the separation of the great branches of the government.

• Special civil actions of certiorari and prohibition are available only when there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law.

• The doctrine of primary jurisdiction bars courts from resolving controversies that fall within the jurisdiction of an administrative tribunal.

• Courts may decide a question otherwise moot if it is capable of repetition yet evading review.

• Courts have a duty to interpret and indicate what the law is, even when faced with a fait accompli.

• Administrative regulations or orders cannot extend the law or amend a legislative enactment. The function of promulgating rules and regulations is limited to implementing the law or putting it into effect.

• Rules of administrative agencies that modify existing laws or exceed their intended scope are void for being ultra vires and unreasonable.

• The clear letter of the law is controlling and cannot be amended by a mere administrative rule issued for its implementation.

• Administrative or executive acts, orders, and regulations are valid only when they are not contrary to the laws or the Constitution.

• When the application of an administrative issuance modifies existing laws or exceeds the intended scope, the issuance becomes void, not only for being ultra vires but also for being unreasonable.

• The court will strive to settle the entire controversy in a single proceeding to avoid future litigation.

• Good faith and absence of knowledge of lack of legal basis are factors that may exempt individuals from refunding payments received in good faith.

• Employees who received wage increases or other benefits due to an honest belief that they were entitled to such benefits and without knowledge of any legal deficiencies are not required to refund the amounts received.