ACCFA v CUGCO Digest

G.R. No. L-21484 November 29, 1969

Facts:

1. ACCFA, a government agency created under RA 821, as amended was reorganized and its name changed to Agricultural Credit Administration (ACA) under the RA 3844 or Land Reform Code. While ACCFA Supervisors' Association (ASA) and the ACCFA Workers' Association (AWA), are labor organizations (the Unions) composed of the supervisors and the rank-and-file employees in the ACCFA.
2. A CBA was agreed upon by labor unions (ASA and AWA) and ACCFA. The said CBA was supposed to be effective on 1 July 1962. Due to non-implementation of the CBA the unions held a strike. And 5 days later, the Unions, with its mother union, the Confederation of Unions in Government Corporations and Offices (CUGCO), filed a complaint against ACCFA before the CIR on ground of alleged acts of unfair labor practices; violation of the collective bargaining agreement in order to discourage the members of the Unions in the exercise of their right to self-organization, discrimination against said members in the matter of promotions and refusal to bargain.
3. ACCFA moved for a reconsideration but while the appeal was pending, RA 3844 was passed which effectively turned ACCFA to ACA. Then, ASA and AWA petitioned that they obtain sole bargaining rights with ACA. While this petition was not yet decided upon, EO 75 was also passed which placed ACA under the Land Reform Project Administration. Notwithstanding the latest legislation passed, the trial court and the appellate court ruled in favor of ASA and AWA. 

ISSUE: W/N ACA is a government entity

YES.

It was in furtherance of such policy that the Land Reform Code was enacted and the various agencies, the ACA among them, established to carry out its purposes. There can be no dispute as to the fact that the land reform program contemplated in the said Code is beyond the capabilities of any private enterprise to translate into reality. It is a purely governmental function, no less than, the establishment and maintenance of public schools and public hospitals. And when, aside from the governmental objectives of the ACA, geared as they are to the implementation of the land reform program of the State, the law itself declares that the ACA is a government office, with the formulation of policies, plans and programs vested no longer in a Board of Governors, as in the case of the ACCFA, but in the National Land Reform Council, itself a government instrumentality; and that its personnel are subject to Civil Service laws and to rules of standardization with respect to positions and salaries, any vestige of doubt as to the governmental character of its functions disappears.

The growing complexities of modern society, however, have rendered this traditional classification of the functions of government quite unrealistic, not to say obsolete. The areas which used to be left to private enterprise and initiative and which the government was called upon to enter optionally, and only "because it was better equipped to administer for the public welfare than is any private individual or group of individuals,"5continue to lose their well-defined boundaries and to be absorbed within activities that the government must undertake in its sovereign capacity if it is to meet the increasing social challenges of the times. Here as almost everywhere else the tendency is undoubtedly towards a greater socialization of economic forces. Here of course this development was envisioned, indeed adopted as a national policy, by the Constitution itself in its declaration of principle concerning the promotion of social justice.

The Unions have no bargaining rights with ACA. EO 75 placed ACA under the LRPA and by virtue of RA 3844 the implementation of the Land Reform Program of the government is a governmental function NOT a proprietary function. Being such, ACA can no longer step down to deal privately with said unions as it may have been doing when it was still ACCFA. However, the growing complexities of modern society have rendered the classification of the governmental functions as unrealistic, if not obsolete. Ministerial and governmental functions continue to lose their well-defined boundaries and are absorbed within the activities that the government must undertake in its sovereign capacity if it to meet the increasing social challenges of the times and move towards a greater socialization of economic forces.