Political Law

American Tobacco Company vs Director of Patents

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G.R. No. L-26803 – 67 SCRA 287 – Political Law – Constitutional Law – Due Process; Administrative Bodies

The American Tobacco Company (ACT) was a party to a trademark case pending before the Philippine Patent Office. ATC challenged the validity of Rule 168 of the “Revised Rules of Practice before the Philippine Patent Office in Trademark Cases” as amended, authorizing the Director of Patents to designate any ranking official of said office to hear “inter partes” proceedings.

ATC argued that the same set of Rules provides that “all judgments determining the merits of the case shall be personally and directly prepared by the Director and signed by him” hence it is improper for the director to designate a lower ranking official as hearing officers to hear the case; that it is clear that under the Rules, the Director must personally hear the case otherwise, there will be a violation of due process.

ISSUE: Whether or not the designation of hearing officers other than the Director of Patents is a violation of due process.

HELD: No. The Supreme Court ruled that the power to decide resides solely in the administrative agency vested by law, this does not preclude a delegation of the power to hold a hearing on the basis of which the decision of the administrative agency will be made. The rule that requires an administrative officer to exercise his own judgment and discretion does not preclude him from utilizing, as a matter of practical administrative procedure, the aid of subordinates to investigate and report to him the facts, on the basis of which the officer makes his decisions.  It is sufficient that the judgment and discretion finally exercised are those of the officer authorized by law. Neither does due process of law nor the requirements of fair hearing require that the actual taking of testimony be before the same officer who will make the decision in the case. As long as a party is not deprived of his right to present his own case and submit evidence in support thereof, and the decision is supported by the evidence in the record, there is no question that the requirements of due process and fair trial are fully met.  In short, there is no abnegation of responsibility on the part of the officer concerned as the actual decision remains with and is made by said officer.  It is, however, required that to “give the substance of a hearing, which is for the purpose of making determinations upon evidence the officer who makes the determinations must consider and appraise the evidence which justifies them.”

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