Concepcion cor. Arroceros Sts., also in Manila (Concepcion-Arroceros property).

Title
to the Concepcion-Arroceros property was transferred to this Court in 2005 pursuant
THIRD DIVISION to Proclamation No. 835[3] dated April 27, 2005. Both the GSIS and the Metropolitan
Trial Court (MeTC) of Manila occupy the Concepcion-Arroceros property, while the
Katigbak property was under lease.
GOVERNMENT SERVICE INSURANCE SYSTEM, G.R. No. 186242
Petitioner, The controversy started when the City Treasurer of Manila addressed a
letter[4] dated September 13, 2002 to GSIS President and General Manager Winston
Present: F. Garcia informing him of the unpaid real property taxes due on the
- versus - aforementioned properties for years 1992 to 2002, broken down as follows: (a) PhP
54,826,599.37 for the Katigbak property; and (b) PhP 48,498,917.01 for the
CORONA, J., Chairperson,Concepcion-Arroceros property. The letter warned of the inclusion of the subject
properties in the scheduled October 30, 2002 public auction of all delinquent
VELASCO, JR.,
properties in Manila should the unpaid taxes remain unsettled before that date.
NACHURA,
CITY TREASURER and CITY ASSESSOR of the CITY PERALTA, and On September 16, 2002, the City Treasurer of Manila issued
OFMANILA,
DEL CASTILLO,* JJ. separate Notices of Realty Tax Delinquency[5] for the subject properties, with the usual
Respondents. warning of seizure and/or sale. On October 8, 2002, GSIS, through its legal counsel,
wrote back emphasizing the GSIS exemption from all kinds of taxes, including realty
taxes, under Republic Act No. (RA) 8291.[6]
Promulgated:

Two days after, GSIS filed a petition for certiorari and prohibition[7] with
December 23, 2009
prayer for a restraining and injunctive relief before the Manila RTC. In it, GSIS prayed
for the nullification of the assessments thus made and
x-----------------------------------------------------------------------------------------x that respondents City of Manila officials be permanently enjoined from proceedings
against GSIS property. GSIS would later amend its petition[8] to include the fact
that: (a) the Katigbak property, covered by TCT Nos. 117685 and 119465 in the name
DECISION of GSIS, has, since November 1991, been leased to and occupied by the Manila Hotel
Corporation (MHC), which has contractually bound itself to pay any realty taxes that
VELASCO, JR., J.: may be imposed on the subject property; and (b) the Concepcion-Arroceros property
The Case is partly occupied by GSIS and partly occupied by the MeTC of Manila.

The Ruling of the RTC

For review under Rule 45 of the Rules of Court on pure question of law are
the November 15, 2007 Decision[1] and January 7, 2009 Order[2] of the Regional Trial By Decision of November 15, 2007, the RTC dismissed GSIS petition, as
Court (RTC), Branch 49 in Manila, in Civil Case No. 02-104827, a suit to nullify the follows:
assessment of real property taxes on certain properties belonging to petitioner
Government Service Insurance System (GSIS).
WHEREFORE, in view of the foregoing, judgment is
hereby rendered, DISMISSING the petition for lack of merit, and
The Facts declaring the assessment conducted by
the respondents City ofManila on the subject real properties of
GSIS as valid pursuant to law.
Petitioner GSIS owns or used to own two (2) parcels of land, one located at
Katigbak 25th St., Bonifacio Drive, Manila (Katigbak property), and the other, at SO ORDERED.[9]

GSIS sought but was denied reconsideration per the assailed Order dated
January 7, 2009.
Thus, the instant petition for review on pure question of law.
The Issues
1. Whether petitioner is exempt from the payment of real property
taxes from 1992 to 2002;
2. Whether petitioner is exempt from the payment of real property
taxes on the property it leased to a taxable entity; and
3. Whether petitioners real properties are exempt from warrants of
levy and from tax sale for non-payment of real property
taxes.[10]
The Courts Ruling
The issues raised may be formulated in the following wise: first, whether
GSIS under its charter is exempt from real property taxation; second, assuming that it
is so exempt, whether GSIS is liable for real property taxes for its properties leased to
a taxable entity; and third, whether the properties of GSIS are exempt from levy.
In the main, it is petitioners posture that both its old charter, Presidential
Decree No. (PD) 1146, and present charter, RA 8291 or the GSIS Act of 1997, exempt
the agency and its properties from all forms of taxes and assessments, inclusive of
realty tax. Excepting, respondents counter that GSIS may not successfully resist
the citys notices and warrants of levy on the basis of its exemption under RA 8291,
real property taxation being governed by RA 7160 or the Local Government Code of
1991 (LGC, hereinafter).
The petition is meritorious.
First Core Issue: GSIS Exempt from Real Property Tax
Full tax exemption granted through PD 1146
In 1936, Commonwealth Act No. (CA) 186[11] was enacted abolishing the
then pension systems under Act No. 1638, as amended, and establishing the GSIS to
manage the pension system, life and retirement insurance, and other benefits of all
government employees. Under what may be considered as its first charter, the GSIS
was set up as a non-stock corporation managed by a board of trustees. Notably,
Section 26 of CA 186 provided exemption from any legal process and liens but only
for insurance policies and their proceeds, thus:
Section 26. Exemption from legal process and liens. No
policy of life insurance issued under this Act, or the proceeds
thereof, when paid to any member thereunder, nor any other
benefit granted under this Act, shall be liable to attachment,
garnishment, or other process, or to be seized, taken,
appropriated, or applied by any legal or equitable process or
operation of law to pay any debt or liability of such member, or his
beneficiary, or any other person who may have a right thereunder,
either before or after payment; nor shall the proceeds thereof,
when not made payable to a named beneficiary, constitute a part
of the estate of the member for payment of his debt. x x x
In 1977, PD 1146,[12] otherwise known as the Revised Government Service
Insurance Act of 1977, was issued, providing for an expanded insurance system for
government employees. Sec. 33 of PD 1146 provided for a new tax treatment for
GSIS, thus:
Section 33. Exemption from Tax, Legal Process and
Lien. It is hereby declared to be the policy of the State that the
actuarial solvency of the funds of the System shall be preserved
and maintained at all times and that the contribution rates
necessary to sustain the benefits under this Act shall be kept as
low as possible in order not to burden the members of the System
and/or their employees. Taxes imposed on the System tend to
impair the actuarial solvency of its funds and increase the
contribution rate necessary to sustain the benefits under this
Act. Accordingly, notwithstanding any laws to the contrary,
the System, its assets, revenues including all accruals
thereto, and benefits paid, shall be exempt from all taxes,
assessments, fees, charges or duties of all kinds. These
exemptions shall continue unless expressly and specifically
revoked and any assessment against the System as of the
approval of this Act are hereby considered paid.
The benefits granted under this Act shall not be subject,
among others, to attachment, garnishment, levy or other
processes. This, however, shall not apply to obligations of the
member to the System, or to the employer, or when the benefits
granted herein are assigned by the member with the authority of
the System. (Emphasis ours.)

A scrutiny of PD 1146 reveals that the non-stock corporate structure of
GSIS, as established under CA 186, remained unchanged. Sec. 34 of PD 1146
pertinently provides that the GSIS, as created by CA 186, shall implement the
provisions of PD 1146.
RA 7160 lifted GSIS tax
exemption
Then came the enactment in 1991 of the LGC or RA 7160, providing the
exercise of local government units (LGUs) of their power to tax, the scope and
limitations thereof, and the exemptions from taxations. Of particular pertinence is the
general provision on withdrawal of tax exemption privileges in Sec. 193 of the LGC,
and the special provision on withdrawal of exemption from payment of real property
taxes in the last paragraph of the succeeding Sec. 234, thus:
SEC. 193. Withdrawal of Tax Exemption Privileges.
Unless otherwise provided in this Code, tax exemptions or
incentives granted to, or presently enjoyed by all persons,
whether natural or juridical, including government-owned or -
controlled corporations, except local water districts, cooperatives
duly registered under R.A. No. 6938, non-stock and non-profit
hospitals and educational institutions, are hereby withdrawn upon
the effectivity of this Code.
SEC. 234. Exemption from Real Property Tax. x x x
Except as provided herein, any exemption from payment of real
property tax previously granted to, or presently enjoyed by, all
persons, whether natural or juridical, including all government-
owned or controlled corporation are hereby withdrawn upon the
effectivity of this Code.
From the foregoing provisos, there can be no serious doubt about the
Congress intention to withdraw, subject to certain defined exceptions, tax exemptions
granted prior to the passage of RA 7160. The question that easily comes to mind then
is whether or not the full tax exemption heretofore granted to GSIS under PD 1146,
particular insofar as realty tax is concerned, was deemed withdrawn. We answer in
the affirmative.
In Mactan Cebu International Airport Authority v. Marcos,[15] the Court held
that the express withdrawal by the LGC of previously granted exemptions from realty
taxes applied to instrumentalities and government-owned and controlled corporations
(GOCCs), such as the Mactan-Cebu International Airport Authority. In City of Davao v.
RTC, Branch XII, Davao City,[16] the Court, citing Mactan Cebu International Airport
Authority, declared the GSIS liable for real property taxes for the years 1992 to 1994
(contested real estate tax assessment therein), its previous exemption under PD 1146
being considered withdrawn with the enactment of the LGC in 1991.
Significantly, the Court, in City of Davao, stated the observation that the
GSIS tax-exempt status withdrawn in 1992 by the LGC was restored in 1997 by RA
8291.[17]
Full tax exemption reenacted through RA
8291
Indeed, almost 20 years to the day after the issuance of the GSIS charter,
i.e., PD 1146, it was further amended and expanded by RA 8291 which took effect on
June 24, 1997. Under it, the full tax exemption privilege of GSIS was restored, the
operative provision being Sec. 39 thereof, a virtual replication of the earlier quoted
Sec. 33 of PD 1146. Sec. 39 of RA 8291 reads:
SEC. 39. Exemption from Tax, Legal Process and Lien.
It is hereby declared to be the policy of the State that the actuarial
solvency of the funds of the GSIS shall be preserved and
maintained at all times and that contribution rates necessary to
sustain the benefits under this Act shall be kept as low as
possible in order not to burden the members of the GSIS and their
employers. Taxes imposed on the GSIS tend to impair the
actuarial solvency of its funds and increase the contribution rate
necessary to sustain the benefits of this Act. Accordingly,
notwithstanding, any laws to the contrary, the GSIS, its assets,
revenues including all accruals thereto, and benefits paid,
shall be exempt from all taxes, assessments, fees, charges
or duties of all kinds. These exemptions shall continue
unless expressly and specifically revoked and any
assessment against the GSIS as of the approval of this Act
are hereby considered paid. Consequently, all laws, ordinances,
regulations, issuances, opinions or jurisprudence contrary to or in
derogation of this provision are hereby deemed repealed,
superseded and rendered ineffective and without legal force and
effect.
Moreover, these exemptions shall not be affected by
subsequent laws to the contrary unless this section is
expressly, specifically and categorically revoked or repealed
by law and a provision is enacted to substitute or replace the
exemption referred to herein as an essential factor to
maintain or protect the solvency of the fund, notwithstanding
and independently of the guaranty of the national government to
secure such solvency or liability.
The funds and/or the properties referred to herein
as well as the benefits, sums or monies corresponding to the
benefits under this Act shall be exempt from attachment,
 garnishment, execution, levy or other processes issued by
the courts, quasi-judicial agencies or administrative
bodies including Commission on Audit (COA) disallowances and
from all financial obligations of the members, including his
pecuniary accountability arising from or caused or occasioned by
his exercise or performance of his official functions or duties, or
incurred relative to or in connection with his position or work
except when his monetary liability, contractual or otherwise, is in
favor of the GSIS. (Emphasis ours.)
The foregoing exempting proviso, couched as it were in an encompassing
manner, brooks no other construction but that GSIS is exempt from all forms of
taxes. While not determinative of this case, it is to be noted that prominently added in
GSIS present charter is a paragraph precluding any implied repeal of the tax-exempt
clause so as to protect the solvency of GSIS funds. Moreover, an express repeal by a
subsequent law would not suffice to affect the full exemption benefits granted the
GSIS, unless the following conditionalities are met: (1) The repealing clause
must expressly, specifically, and categorically revoke or repeal Sec. 39; and (2)
a provision is enacted to substitute or replace the exemption referred to herein as
an essential factor to maintain or protect the solvency of the fund. These restrictions
for a future express repeal, notwithstanding, do not make the proviso an irrepealable
law, for such restrictions do not impinge or limit the carte blanche legislative authority
of the legislature to so amend it. The restrictions merely enhance other provisos in the
law ensuring the solvency of the GSIS fund.
Given the foregoing perspectives, the following may be assumed: (1)
Pursuant to Sec. 33 of PD 1146, GSIS enjoyed tax exemption from real estate taxes,
among other tax burdens, until January 1, 1992 when the LGC took effect and
withdrew exemptions from payment of real estate taxes privileges granted under PD
1146; (2) RA 8291 restored in 1997 the tax exempt status of GSIS by reenacting
under its Sec. 39 what was once Sec. 33 of P.D. 1146; [19] and (3) If any real estate tax
is due to the City of Manila, it is, following City of Davao, only for the interim period, or
from 1992 to 1996, to be precise.
Real property taxes assessed and due from GSIS considered paid
While recognizing the exempt status of GSIS owing to the reenactment of
the full tax exemption clause under Sec. 39 of RA 8291 in 1997, the ponencia in City
of Davaoappeared to have failed to take stock of and fully appreciate the all-
embracing condoning proviso in the very same Sec. 39 which, for all intents and
purposes, considered as paidany assessment against the GSIS as of the approval
of this Act. If only to stress the point, we hereby reproduce the pertinent portion of
said Sec. 39:
SEC. 39. Exemption from Tax, Legal Process and Lien.
x x x Taxes imposed on the GSIS tend to impair the actuarial
solvency of its funds and increase the contribution rate necessary
to sustain the benefits of this Act. Accordingly, notwithstanding,
any laws to the contrary, the GSIS, its assets, revenues including
all accruals thereto, and benefits paid, shall be exempt from all
taxes, assessments, fees, charges or duties of all
kinds. These exemptions shall continue unless expressly and
specifically revoked and any assessment against the GSIS as
of the approval of this Act are hereby considered
paid. Consequently, all laws, ordinances, regulations, issuances,
opinions or jurisprudence contrary to or in derogation of this
provision are hereby deemed repealed, superseded and rendered
ineffective and without legal force and effect. (Emphasis added.)
GSIS an instrumentality of the National Government
Apart from the foregoing consideration, the Courts fairly recent ruling
in Manila International Airport Authority v. Court of Appeals,[20] a case likewise
involving real estate tax assessments by a Metro Manila city on the real properties
administered by MIAA, argues for the non-tax liability of GSIS for real estate
taxes. There, the Court held that MIAA does not qualify as a GOCC, not having been
organized either as a stock corporation, its capital not being divided into shares, or as
a non-stock corporation because it has no members. MIAA is rather
an instrumentality of the National Government and, hence, outside the purview of
local taxation by force of Sec. 133 of the LGC providing in context that unless
otherwise provided, local governments cannot tax national government
instrumentalities. And as the Court pronounced in Manila International Airport
Authority, the airport lands and buildings MIAA administers belong to the Republic of
the Philippines, which makes MIAA a mere trustee of such assets. No less than the
Administrative Code of 1987 recognizes a scenario where a piece of land owned by
the Republic is titled in the name of a department, agency, or instrumentality. The
following provision of the said Code suggests as much:
Sec. 48. Official Authorized to Convey Real
Property.Whenever real property of the Government is authorized
by law to be conveyed, the deed of conveyance shall be executed
in behalf of the government by the following: x x x x
(2) For property belonging to the Republic of
the Philippines, but titled in the name of x x x any corporate
agency or instrumentality, by the executive head of the agency or
instrumentality.[21]
 While perhaps not of governing sway in all fours inasmuch as what were under Sec. 24[22] of CA 186, then Sec. 8[23] of PD 1146, and finally in Sec. 8[24] of RA
involved in Manila International Airport Authority, e.g., airfields and runways, are 8291.
properties of the public dominion and, hence, outside the commerce of man, the
rationale underpinning the disposition in that case is squarely applicable to GSIS, both
MIAA and GSIS being similarly situated. First, while created under CA 186 as a non- Second Core Issue: Beneficial Use Doctrine Applicable
stock corporation, a status that has remained unchanged even when it operated under
PD 1146 and RA 8291, GSIS is not, in the context of the afore quoted Sec. 193 of the
LGC, a GOCC following the teaching of Manila International Airport Authority, for, like
MIAA, GSIS capital is not divided into unit shares. Also, GSIS has no members to The foregoing notwithstanding, the leased Katigbak property shall be
speak of. And by members, the reference is to those who, under Sec. 87 of the taxable pursuant to the beneficial use principle under Sec. 234(a) of the LGC.
Corporation Code, make up the non-stock corporation, and not to the compulsory
members of the system who are government employees. Its management is entrusted
to a Board of Trustees whose members are appointed by the President. It is true that said Sec. 234(a), quoted below, exempts from real estate
taxes real property owned by the Republic, unless the beneficial use of the property is,
for consideration, transferred to a taxable person.
Second, the subject properties under GSISs name are likewise owned by SEC. 234. Exemptions from Real Property Tax. The
the Republic. The GSIS is but a mere trustee of the subject properties which have following are exempted from payment of the real property
either been ceded to it by the Government or acquired for the enhancement of the tax:
system. This particular property arrangement is clearly shown by the fact that the
disposal or conveyance of said subject properties are either done by or through the
authority of the President of the Philippines. Specifically, in the case of the
(a) Real property owned by the Republic of the
Concepcion-Arroceros property, it was transferred, conveyed, and ceded to this Court
Philippines or any of its political subdivisions except when
on April 27, 2005 through a presidential proclamation, Proclamation No.
the beneficial use thereof has been granted, for
835. Pertinently, the text of the proclamation announces that the Concepcion-
consideration or otherwise, to a taxable person.
Arroceros property was earlier ceded to the GSIS on October 13, 1954 pursuant to
Proclamation No. 78 for office purposes and had since been titled to GSIS which
constructed an office building thereon. Thus, the transfer on April 27, 2005 of the
Concepcion-Arroceros property to this Court by the President through Proclamation This exemption, however, must be read in relation with Sec. 133(o) of the
No. 835. This illustrates the nature of the government ownership of the subject GSIS LGC, which prohibits LGUs from imposing taxes or fees of any kind on the national
properties, as indubitably shown in the last clause of Presidential Proclamation No. government, its agencies, and instrumentalities:
835:

SEC. 133. Common Limitations on the Taxing

WHEREAS, by virtue of the Public Land Act
(Commonwealth Act No. 141, as amended), Presidential Decree
No. 1455, and the Administrative Code of 1987, the President is
authorized to transfer any government property that is no
longer needed by the agency to which it belongs to other
branches or agencies of the government. (Emphasis ours.)
Powers of Local Government Units. Unless otherwise provided
herein, the exercise of the taxing powers of provinces, cities,
municipalities, and barangays shall not extend to the levy of
the following:
xxxx

Third, GSIS manages the funds for the life insurance, retirement,
survivorship, and disability benefits of all government employees and their (o) Taxes, fees or charges of any kinds on the
beneficiaries. This undertaking, to be sure, constitutes an essential and vital function National Government, its agencies and instrumentalities, and
which the government, through one of its agencies or instrumentalities, ought to local government units. (Emphasis supplied.)
perform if social security services to civil service employees are to be delivered with
reasonable dispatch. It is no wonder, therefore, that the Republic guarantees the
fulfillment of the obligations of the GSIS to its members (government employees and
their beneficiaries) when and as they become due. This guarantee was first formalized
 Thus read together, the provisions allow the Republic to grant the beneficial
use of its property to an agency or instrumentality of the national government. Such
grant does not necessarily result in the loss of the tax exemption. The tax exemption
the property of the Republic or its instrumentality carries ceases only if, as stated in
Sec. 234(a) of the LGC of 1991, beneficial use thereof has been granted, for a
consideration or otherwise, to a taxable person. GSIS, as a government
instrumentality, is not a taxable juridical person under Sec. 133(o) of the LGC. GSIS,
however, lost in a sense that status with respect to the Katigbak property when it
contracted its beneficial use to MHC, doubtless a taxable person. Thus, the real estate
tax assessment of PhP 54,826,599.37 covering 1992 to 2002 over the subject
Katigbak property is valid insofar as said tax delinquency is concerned as assessed
over said property.
Taxable entity having beneficial use of leased
property liable for real property taxes thereon
The next query as to which between GSIS, as the owner of the Katigbak
property, or MHC, as the lessee thereof, is liable to pay the accrued real estate tax,
need not detain us long. MHC ought to pay.
As we declared in Testate Estate of Concordia T. Lim, the unpaid tax
attaches to the property and is chargeable against the taxable person who had actual
or beneficial use and possession of it regardless of whether or not he is the owner. Of
the same tenor is the Courts holding in the subsequent Manila Electric Company v.
Barlis[25] and later inRepublic v. City of Kidapawan.[26] Actual use refers to the purpose
for which the property is principally or predominantly utilized by the person in
possession thereof.[27]
Being in possession and having actual use of the Katigbak property since
November 1991, MHC is liable for the realty taxes assessed over the Katigbak
property from 1992 to 2002.
The foregoing is not all. As it were, MHC has obligated itself under the
GSIS-MHC Contract of Lease to shoulder such assessment. Stipulation l8 of the
contract pertinently reads:
18. By law, the Lessor, [GSIS], is exempt from taxes,
assessments and levies. Should there be any change in the law
or the interpretation thereof or any other circumstances which
would subject the Leased Property to any kind of tax, assessment
or levy which would constitute a charge against the Lessor or
create a lien against the Leased Property, the Lessee agrees
and obligates itself to shoulder and pay such tax,
assessment or levy as it becomes due.[28] (Emphasis ours.)
As a matter of law and contract, therefore, MHC stands liable to pay the
realty taxes due on the Katigbak property. Considering, however, that MHC has not
been impleaded in the instant case, the remedy of the City of Manila is to serve the
realty tax assessment covering the subject Katigbak property to MHC and to pursue
other available remedies in case of nonpayment, for said property cannot be levied
upon as shall be explained below.
Third Core Issue: GSIS Properties Exempt from Levy
In light of the foregoing disquisition, the issue of the propriety of the
threatened levy of subject properties by the City of Manila to answer for the demanded
realty tax deficiency is now moot and academic. A valid tax levy presupposes a
corresponding tax liability. Nonetheless, it will not be remiss to note that it is without
doubt that the subject GSIS properties are exempt from any attachment, garnishment,
execution, levy, or other legal processes. This is the clear import of the third
paragraph of Sec. 39, RA 8291, which we quote anew for clarity:
SEC. 39. Exemption from Tax, Legal Process and Lien.
x x x.
xxxx
The funds and/or the properties referred to herein
as well as the benefits, sums or monies corresponding to the
benefits under this Act shall be exempt from attachment,
garnishment, execution, levy or other processes issued by
the courts, quasi-judicial agencies or administrative
bodies including Commission on Audit (COA) disallowances and
from all financial obligations of the members, including his
pecuniary accountability arising from or caused or occasioned by
his exercise or performance of his official functions or duties, or
incurred relative to or in connection with his position or work
except when his monetary liability, contractual or otherwise, is in
favor of the GSIS. (Emphasis ours.)
 The Court would not be indulging in pure speculative exercise to say that
the underlying legislative intent behind the above exempting proviso cannot be other
than to isolate GSIS funds and properties from legal processes that will either impair
the solvency of its fund or hamper its operation that would ultimately require an
increase in the contribution rate necessary to sustain the benefits of the system.
Throughout GSIS life under three different charters, the need to ensure the solvency
of GSIS fund has always been a legislative concern, a concern expressed in the tax-
exempting provisions.
Thus, even granting arguendo that GSIS liability for realty taxes attached
from 1992, when RA 7160 effectively lifted its tax exemption under PD 1146, to 1996,
when RA 8291 restored the tax incentive, the levy on the subject properties to answer
for the assessed realty tax delinquencies cannot still be sustained. The simple reason:
The governing law, RA 8291, in force at the time of the levy prohibits it. And in the final
analysis, the proscription against the levy extends to the leased Katigbak property, the
beneficial use doctrine, notwithstanding.
Summary
In sum, the Court finds that GSIS enjoys under its charter full tax exemption.
Moreover, as an instrumentality of the national government, it is itself not liable to pay
real estate taxes assessed by the City of Manila against its Katigbak and Concepcion-
Arroceros properties. Following the beneficial use rule, however, accrued real property
taxes are due from the Katigbak property, leased as it is to a taxable entity. But the
corresponding liability for the payment thereof devolves on the taxable beneficial
user. The Katigbak property cannot in any event be subject of a public auction sale,
notwithstanding its realty tax delinquency. This means that the City of Manila has to
satisfy its tax claim by serving the accrued realty tax assessment on MHC, as the
taxable beneficial user of the Katigbak property and, in case of nonpayment, through
means other than the sale at public auction of the leased property.
WHEREFORE, the instant petition is hereby GRANTED. The November
15, 2007 Decision and January 7, 2009 Order of the Regional Trial Court, Branch
49, Manilaare REVERSED and SET ASIDE. Accordingly, the real property tax
assessments issued by the City of Manila to the Government Service Insurance
System on the subject properties are declared VOID, except that the real property tax
assessment pertaining to the leased Katigbak property shall be valid if served on the
Manila Hotel Corporation, as lessee which has actual and beneficial use thereof. The
City of Manila is permanently restrained from levying on or selling at public auction the
subject properties to satisfy the payment of the real property tax delinquency.
No pronouncement as to costs.
SO ORDERED.
EN BANC
G.R. No. 204429, February 18, 2014
SMART COMMUNICATIONS, INC., Petitioner, v. MUNICIPALITY OF MALVAR,
BATANGAS,Respondent.
DECISION
CARPIO, J.:
The Case
This petition for review1 challenges the 26 June 2012 Decision2 and 13 November
2012 Resolution3 of the Court of Tax Appeals (CTA) En Banc. The CTA En
Banc affirmed the 17 December 2010 Decision4and 7 April 2011 Resolution5 of the
CTA First Division, which in turn affirmed the 2 December 2008 6Decision and 21 May
2009 Order7 of the Regional Trial Court of Tanauan City, Batangas, Branch 6. The trial
court declared void the assessment imposed by respondent Municipality of Malvar,
Batangas against petitioner Smart Communications, Inc. for its telecommunications
tower for 2001 to July 2003 and directed respondent to assess petitioner only for the
period starting 1 October 2003.
The Facts
Petitioner Smart Communications, Inc. (Smart) is a domestic corporation engaged in
the business of providing telecommunications services to the general public while
respondent Municipality of Malvar, Batangas (Municipality) is a local government unit
created by law.
In the course of its business, Smart constructed a telecommunications tower within the
territorial jurisdiction of the Municipality. The construction of the tower was for the
purpose of receiving and transmitting cellular communications within the covered area.
On 30 July 2003, the Municipality passed Ordinance No. 18, series of 2003, entitled
An Ordinance Regulating the Establishment of Special Projects.
On 24 August 2004, Smart received from the Permit and Licensing Division of the
Office of the Mayor of the Municipality an assessment letter with a schedule of
payment for the total amount of P389,950.00 for Smarts telecommunications tower.
The letter reads as follows:
This is to formally submit to your good office your schedule of payments in the
Municipal Treasury of the Local Government Unit of Malvar, province of Batangas
which corresponds to the tower of your company built in the premises of the
municipality, to wit:
 Hoping that you will give this matter your preferential attention.8
TOTAL
PHP Due to the alleged arrears in the payment of the assessment, the Municipality also
PROJECT
11,000,000.00 caused the posting of a closure notice on the telecommunications tower.
COST:
On 9 September 2004, Smart filed a protest, claiming lack of due process in the
For the Year issuance of the assessment and closure notice. In the same protest, Smart challenged
20012003 the validity of Ordinance No. 18 on which the assessment was based.
In a letter dated 28 September 2004, the Municipality denied Smarts protest.
50% of 1% of
On 17 November 2004, Smart filed with Regional Trial Court of Tanauan City,
the total Php55,000.00
Batangas, Branch 6, an Appeal/Petition assailing the validity of Ordinance No. 18.
project cost
The case was docketed as SP Civil Case No. 04111920.
On 2 December 2008, the trial court rendered a Decision partly granting Smarts
Add: 45%
24,750.00 Appeal/Petition. The trial court confined its resolution of the case to the validity of the
surcharge
assessment, and did not rule on the legality of Ordinance No. 18. The trial court held
that the assessment covering the period from 2001 to July 2003 was void since
Php79,750.00 Ordinance No. 18 was approved only on 30 July 2003. However, the trial court
declared valid the assessment starting 1 October 2003, citing Article 4 of the Civil
Code of the Philippines,9 in relation to the provisions of Ordinance No. 18 and Section
166 of Republic Act No. 7160 or the Local Government Code of 1991 (LGC). 10 The
dispositive portion of the trial courts Decision reads:
Multiply by 3 WHEREFORE, in light of the foregoing, the Petition is partly GRANTED. The
yrs. (2001, Php239,250.00 assessment dated August 24, 2004 against petitioner is hereby declared null and void
2002, 2003) insofar as the assessment made from year 2001 to July 2003 and respondent is
hereby prohibited from assessing and collecting, from petitioner, fees during the said
period and the Municipal Government of Malvar, Batangas is directed to assess Smart
Communications, Inc. only for the period starting October 1, 2003.

For the year No costs.

2004 SO ORDERED.11
The trial court denied the motion for reconsideration in its Order of 21 May 2009.
1% of the total
Php110,000.00
project cost On 8 July 2009, Smart filed a petition for review with the CTA First Division, docketed
as CTA AC No. 58.
37% On 17 December 2010, the CTA First Division denied the petition for review. The
40,700.00
surcharge dispositive portion of the decision reads:
WHEREFORE, the Petition for Review is hereby DENIED, for lack of merit.
Accordingly, the assailed Decision dated December 2, 2008 and the Order dated May
21, 2009 of Branch 6 of the Regional Trial Court of Tanauan City, Batangas in SP.
Civil Case No. 04111920 entitled Smart Communications, Inc. vs. Municipality of
Php150,700.00 Malvar, Batangas are AFFIRMED.
SO ORDERED.12
On 7 April 2011, the CTA First Division issued a Resolution denying the motion for
reconsideration.
TOTAL Php389,950.00
Smart filed a petition for review with the CTA En Banc, which affirmed the CTA First
Divisions decision and resolution. The dispositive portion of the CTA En Bancs 26
June 2012 decision reads:
WHEREFORE, premises considered, the present Petition for Review is hereby
DISMISSED for lack of merit.
Accordingly, the assailed Decision dated December 17, 2010 and Resolution dated
April 7, 2011 are hereby AFFIRMED.
SO ORDERED.13
The CTA En Banc denied the motion for reconsideration.
Hence, this petition.
The Ruling of the CTA En Banc
The CTA En Banc dismissed the petition on the ground of lack of jurisdiction. The
CTA En Bancdeclared that it is a court of special jurisdiction and as such, it can take
cognizance only of such matters as are clearly within its jurisdiction. Citing Section
7(a), paragraph 3, of Republic Act No. 9282, the CTA En Banc held that the CTA has
exclusive appellate jurisdiction to review on appeal, decisions, orders or resolutions of
the Regional Trial Courts in local tax cases originally resolved by them in the exercise
of their original or appellate jurisdiction. However, the same provision does not confer
on the CTA jurisdiction to resolve cases where the constitutionality of a law or rule is
challenged.
The Issues
The petition raises the following arguments:
1. The [CTA En Banc Decision and Resolution] should be reversed and set aside for
being contrary to law and jurisprudence considering that the CTA En Banc should
have exercised its jurisdiction and declared the Ordinance as illegal.
2. The [CTA En Banc Decision and Resolution] should be reversed and set aside for
being contrary to law and jurisprudence considering that the doctrine of exhaustion of
administrative remedies does not apply in [this case].
3. The [CTA En Banc Decision and Resolution] should be reversed and set aside for
being contrary to law and jurisprudence considering that the respondent has no
authority to impose the socalled fees on the basis of the void ordinance.14
The Ruling of the Court
The Court denies the petition.
On whether the CTA has jurisdiction over the present case
Smart contends that the CTA erred in dismissing the case for lack of jurisdiction.
Smart maintains that the CTA has jurisdiction over the present case considering the
unique factual circumstances involved.
The CTA refuses to take cognizance of this case since it challenges the
constitutionality of Ordinance No. 18, which is outside the province of the CTA.
Jurisdiction is conferred by law. Republic Act No. 1125, as amended by Republic Act
No. 9282, created the Court of Tax Appeals. Section 7, paragraph (a), subparagraph
(3)15 of the law vests the CTA with the exclusive appellate jurisdiction over decisions,
orders or resolutions of the Regional Trial Courts in local tax cases originally decided
or resolved by them in the exercise of their original or appellate jurisdiction.
The question now is whether the trial court resolved a local tax case in order to fall
within the ambit of the CTAs appellate jurisdiction This question, in turn, depends
ultimately on whether the fees imposed under Ordinance No. 18 are in fact taxes.
Smart argues that the fees in Ordinance No. 18 are actually taxes since they are not
regulatory, but revenueraising. Citing Philippine Airlines, Inc. v. Edu,16 Smart
contends that the designation of fees in Ordinance No. 18 is not controlling.
The Court finds that the fees imposed under Ordinance No. 18 are not taxes.
Section 5, Article X of the 1987 Constitution provides that [e]ach local government
unit shall have the power to create its own sources of revenues and to levy taxes,
fees, and charges subject to such guidelines and limitations as the Congress may
provide, consistent with the basic policy of local autonomy. Such taxes, fees, and
charges shall accrue exclusively to the local government.
Consistent with this constitutional mandate, the LGC grants the taxing powers to each
local government unit. Specifically, Section 142 of the LGC grants municipalities the
power to levy taxes, fees, and charges not otherwise levied by provinces. Section 143
of the LGC provides for the scale of taxes on business that may be imposed by
municipalities17 while Section 14718 of the same law provides for the fees and charges
that may be imposed by municipalities on business and occupation.
The LGC defines the term charges as referring to pecuniary liability, as rents or fees
against persons or property, while the term fee means a charge fixed by law or
ordinance for the regulation or inspection of a business or activity.19
In this case, the Municipality issued Ordinance No. 18, which is entitled An
Ordinance Regulatingthe Establishment of Special Projects, to regulate the placing,
stringing, attaching, installing, repair and construction of all gas mains, electric,
telegraph and telephone wires, conduits, meters and other apparatus, and provide for
the correction, condemnation or removal of the same when found to be dangerous,
defective or otherwise hazardous to the welfare of the inhabitant[s].20 It was also
envisioned to address the foreseen environmental depredation to be brought about
by these special projects to the Municipality. 21 Pursuant to these objectives, the
Municipality imposed fees on various structures, which included telecommunications
towers.
As clearly stated in its whereas clauses, the primary purpose of Ordinance No. 18 is to
regulate the placing, stringing, attaching, installing, repair and construction of all gas
mains, electric, telegraph and telephone wires, conduits, meters and other apparatus
listed therein, which included Smarts telecommunications tower. Clearly, the purpose
of the assailed Ordinance is to regulate the enumerated activities particularly related
to the construction and maintenance of various structures. The fees in Ordinance No.
18 are not impositions on the building or structure itself; rather, they are impositions on
the activity subject of government regulation, such as the installation and construction
of the structures.22
Since the main purpose of Ordinance No. 18 is to regulate certain construction
activities of the identified special projects, which included cell sites or
telecommunications towers, the fees imposed in Ordinance No. 18 are primarily
regulatory in nature, and not primarily revenueraising. While the fees may
contribute to the revenues of the Municipality, this effect is merely incidental. Thus, the
fees imposed in Ordinance No. 18 are not taxes.
In Progressive Development Corporation v. Quezon City, the Court declared that if
23
the generating of revenue is the primary purpose and regulation is merely incidental,
the imposition is a tax; but if regulation is the primary purpose, the fact that incidentally
revenue is also obtained does not make the imposition a tax.
In Victorias Milling Co., Inc. v. Municipality of Victorias,24 the Court reiterated that the
purpose and effect of the imposition determine whether it is a tax or a fee, and that the
lack of any standards for such imposition gives the presumption that the same is a tax.
We accordingly say that the designation given by the municipal authorities does not
decide whether the imposition is properly a license tax or a license fee. The
determining factors are the purpose and effect of the imposition as may be apparent
from the provisions of the ordinance. Thus, [w]hen no police inspection, supervision,
or regulation is provided, nor any standard set for the applicant to establish, or that he
agrees to attain or maintain, but any and all persons engaged in the business
designated, without qualification or hindrance, may come, and a license on payment of
the stipulated sum will issue, to do business, subject to no prescribed rule of conduct
and under no guardian eye, but according to the unrestrained judgment or fancy of the
applicant and licensee, the presumption is strong that the power of taxation, and not
the police power, is being exercised.
Contrary to Smarts contention, Ordinance No. 18 expressly provides for the standards
which Smart must satisfy prior to the issuance of the specified permits, clearly
indicating that the fees are regulatory in nature. These requirements are as follows:
SECTION 5. Requirements and Procedures in Securing Preliminary Development
Permit.
The following documents shall be submitted to the SB Secretary in triplicate:
a) zoning clearance
b) Vicinity Map
c) Site Plan
d) Evidence of ownership
e) Certificate true copy of NTC Provisional Authority in case of Cellsites, telephone or
telegraph line, ERB in case of gasoline station, power plant, and other concerned
national agencies
f) Conversion order from DAR is located within agricultural zone.
g) Radiation Protection Evaluation.
h) Written consent from subdivision association or the residence of the area
concerned if the special projects is located within the residential zone.
i) Barangay Council Resolution endorsing the special projects.
SECTION 6. Requirement for Final Development Permit Upon the expiration of 180
days and the proponents of special projects shall apply for final [development permit]
and they are require[d] to submit the following:
a) evaluation from the committee where the Vice Mayor refers the special project
b) Certification that all local fees have been paid.
Considering that the fees in Ordinance No. 18 are not in the nature of local taxes, and
Smart is questioning the constitutionality of the ordinance, the CTA correctly
dismissed the petition for lack of jurisdiction. Likewise, Section 187 of the
LGC,25 which outlines the procedure for questioning the constitutionality of a tax
ordinance, is inapplicable, rendering unnecessary the resolution of the issue on non
exhaustion of administrative remedies.
On whether the imposition of the fees in Ordinance No. 18 is ultra vires
Smart argues that the Municipality exceeded its power to impose taxes and fees as
provided in Book II, Title One, Chapter 2, Article II of the LGC. Smart maintains that
the mayors permit fees in Ordinance No. 18 (equivalent to 1% of the project cost) are
not among those expressly enumerated in the LGC.
As discussed, the fees in Ordinance No.18 are not taxes. Logically, the imposition
does not appear in the enumeration of taxes under Section 143 of the LGC.
Moreover, even if the fees do not appear in Section 143 or any other provision in the
LGC, the Municipality is empowered to impose taxes, fees and charges, not
specifically enumerated in the LGC or taxed under the Tax Code or other applicable
law. Section 186 of the LGC, granting local government units wide latitude in imposing
fees, expressly provides:
Section 186. Power To Levy Other Taxes, Fees or Charges. Local government units
may exercise the power to levy taxes, fees or charges on any base or subject not
otherwise specifically enumerated herein or taxed under the provisions of the National
Internal Revenue Code, as amended, or other applicable laws: Provided, That the
taxes, fees, or charges shall not be unjust, excessive, oppressive, confiscatory or
contrary to declared national policy: Provided, further, That the ordinance levying such
taxes, fees or charges shall not be enacted without any prior public hearing conducted
for the purpose.
Smart further argues that the Municipality is encroaching on the regulatory powers of
the National Telecommunications Commission (NTC). Smart cites Section 5(g) of
Republic Act No. 7925 which provides that the National Telecommunications
Commission (NTC), in the exercise of its regulatory powers, shall impose such fees
and charges as may be necessary to cover reasonable costs and expenses for the
regulation and supervision of the operations of telecommunications entities. Thus,
Smart alleges that the regulation of telecommunications entities and all aspects of its
operations is specifically lodged by law on the NTC.
To repeat, Ordinance No. 18 aims to regulate the placing, stringing, attaching,
installing, repair and construction of all gas mains, electric, telegraph and telephone
wires, conduits, meters and other apparatus within the Municipality. The fees are not
imposed to regulate the administrative, technical, financial, or marketing operations of
telecommunications entities, such as Smarts; rather, to regulate the installation and
maintenance of physical structures Smarts cell sites or telecommunications tower.
The regulation of the installation and maintenance of such physical structures is an
exercise of the police power of the Municipality. Clearly, the Municipality does not
encroach on NTCs regulatory powers.
The Court likewise rejects Smarts contention that the power to fix the fees for the
issuance of development permits and locational clearances is exercised by the
Housing and Land Use Regulatory Board (HLURB). Suffice it to state that the HLURB
itself recognizes the local government units power to collect fees related to land use
and development. Significantly, the HLURB issued locational guidelines governing
telecommunications infrastructure. Guideline No. VI relates to the collection of
locational clearance fees either by the HLURB or the concerned local government
unit, to wit:
VI. Fees
The Housing and Land Use Regulatory Board in the performance of its functions shall
collect the locational clearance fee based on the revised schedule of fees under the
special use project as per Resolution No. 622, series of 1998 or by the concerned
LGUs subject to EO 72.26
On whether Ordinance No. 18 is valid and constitutional
Smart contends that Ordinance No. 18 violates Sections 130(b)(3)27 and 186 of the
LGC since the fees are unjust, excessive, oppressive and confiscatory. Aside from this
bare allegation, Smart did not present any evidence substantiating its claims.
In Victorias Milling Co., Inc. v. Municipality of Victorias,28 the Court rejected the
argument that the fees imposed by respondent therein are excessive for lack of
evidence supporting such claim, to wit:
An ordinance carries with it the presumption of validity. The question of
reasonableness though is open to judicial inquiry. Much should be left thus to the
discretion of municipal authorities. Courts will go slow in writing off an ordinance as
unreasonable unless the amount is so excessive as to be prohibitive, arbitrary,
unreasonable, oppressive, or confiscatory. A rule which has gained acceptance is that
factors relevant to such an inquiry are the municipal conditions as a whole and the
nature of the business made subject to imposition.
Plaintiff, has however not sufficiently proven that, taking these factors together, the
license taxes are unreasonable. The presumption of validity subsists. For, plaintiff has
limited itself to insisting that the amounts levied exceed the cost of regulation and the
municipality has adequate funds for the alleged purposes as evidenced by the
municipalitys cash surplus for the fiscal year ending 1956.
On the constitutionality issue, Smart merely pleaded for the declaration of
unconstitutionality of Ordinance No. 18 in the Prayer of the Petition, without any
argument or evidence to support its plea. Nowhere in the body of the Petition was this
issue specifically raised and discussed. Significantly, Smart failed to cite any
constitutional provision allegedly violated by respondent when it issued Ordinance No.
18.
Settled is the rule that every law, in this case an ordinance, is presumed valid. To
strike down a law as unconstitutional, Smart has the burden to prove a clear and
unequivocal breach of the Constitution, which Smart miserably failed to do. In Lawyers
Against Monopoly and Poverty (LAMP) v. Secretary of Budget and Management,29 the
Court held, thus:
To justify the nullification of the law or its implementation, there must be a clear and
unequivocal, not a doubtful, breach of the Constitution. In case of doubt in the
sufficiency of proof establishing unconstitutionality, the Court must sustain legislation
because to invalidate [a law] based on x x x baseless supposition is an affront to the
wisdom not only of the legislature that passed it but also of the executive which
approved it. This presumption of constitutionality can be overcome only by the
clearest showing that there was indeed an infraction of the Constitution, and only
when such a conclusion is reached by the required majority may the Court pronounce,
in the discharge of the duty it cannot escape, that the challenged act must be struck
down.
WHEREFORE, the Court DENIES the petition.
SO ORDERED.
EN BANC
G.R. No. 195390, December 10, 2014
GOV. LUIS RAYMUND F. VILLAFUERTE, JR., AND THE PROVINCE OF
CAMARINES SUR,Petitioners, v. HON. JESSE M. ROBREDO, IN HIS CAPACITY
AS SECRETARY OF THE DEPARTMENT OF THE INTERIOR AND LOCAL
GOVERNMENT, Respondent.
DECISION
REYES, J.:
This is a petition for certiorari and prohibition1 under Rule 65 of the 1997 Revised
Rules of Court filed by former Governor Luis Raymund F. Villafuerte, Jr. (Villafuerte)
and the Province of Camarines Sur (petitioners), seeking to annul and set aside the
following issuances of the late Honorable Jesse M. Robredo (respondent), in his
capacity as then Secretary of the Department of the Interior and Local Government
(DILG), to wit:
(a) Memorandum Circular (MC) No. 2010-83 dated August 31, 2010, pertaining to the
full disclosure of local budget and finances, and bids and public offerings; 2
(b) MC No. 2010-138 dated December 2, 2010, pertaining to the use of the 20%
 component of the annual internal revenue allotment shares;3 and Reform Act, calls for the posting of the Invitation to Bid, Notice of Award, Notice to
Proceed and Approved Contract in the procuring entitys premises, in newspapers of
(c) MC No. 2011-08 dated January 13, 2011, pertaining to the strict adherence to general circulation, the Philippine Government Electronic Procurement System
Section 90 of Republic Act (R.A.) No. 10147 or the General Appropriations Act of (PhilGEPS) and the website of the procuring entity.
2011.4
The declared policy of the State to promote good local governance also calls for the
posting of budgets, expenditures, contracts and loans, and procurement plans of local
government units in conspicuous places within public buildings in the locality, in the
The petitioners seek the nullification of the foregoing issuances on the ground of web, and in print media of community or general circulation.
unconstitutionality and for having been issued with grave abuse of discretion
amounting to lack or excess of jurisdiction. Furthermore, the President, in his first State of the Nation Address, directed all
The Facts government agencies and entities to bring to an end luxurious spending and
misappropriation of public funds and to expunge mendacious and erroneous projects,
and adhere to the zero-based approach budgetary principle.
In 1995, the Commission on Audit (COA) conducted an examination and audit on the
manner the local government units (LGUs) utilized their Internal Revenue Allotment Responsibility of the Local Chief Executive
(IRA) for the calendar years 1993-1994. The examination yielded an official report,
showing that a substantial portion of the 20% development fund of some LGUs was All Provincial Governors, City Mayors and Municipal Mayors, are directed to faithfully
not actually utilized for development projects but was diverted to expenses properly comply with the abovecited [sic] provisions of laws, and existing national policy, by
chargeable against the Maintenance and Other Operating Expenses (MOOE), in stark posting in conspicuous places within public buildings in the locality, or in print media of
violation of Section 287 of R.A. No. 7160, otherwise known as the Local Government community or general circulation, and in their websites, the following:
Code of 1991 (LGC). Thus, on December 14, 1995, the DILG issued MC No. 95-
216,5 enumerating the policies and guidelines on the utilization of the development 1. CY 2010 Annual Budget, information detail to the level of particulars of
fund component of the IRA. It likewise carried a reminder to LGUs of the strict personal services, maintenance and other operating expenses and capital
mandate to ensure that public funds, like the 20% development fund, shall be spent outlay per individual offices (Source Document - Local Budget Preparation
judiciously and only for the very purpose or purposes for which such funds are Form No. 3, titled, Program Appropriation and Obligation by Object of
intended.6 Expenditure, limited to PS, MOOE and CO. For sample form, please visit
www.naga.gov.ph);
On September 20, 2005, then DILG Secretary Angelo T. Reyes and Department of 2. Quarterly Statement of Cash Flows, information detail to the level of
Budget and Management Secretary Romulo L. Neri issued Joint MC No. 1, series of particulars of cash flows from operating activities (e.g. cash inflows, total
2005,7 pertaining to the guidelines on the appropriation and utilization of the 20% of cash inflows, total cash outflows), cash flows from investing activities (e.g.
the IRA for development projects, which aims to enhance accountability of the LGUs cash outflows), net increase in cash and cash at the beginning of the period
in undertaking development projects. The said memorandum circular underscored that (Source Document - Statement of Cash Flows Form);
the 20% of the IRA intended for development projects should be utilized for social
development, economic development and environmental management. 8 3. CY 2009 Statement of Receipts and Expenditures, information detail to the
level of particulars of beginning cash balance, receipts or income on local
On August 31, 2010, the respondent, in his capacity as DILG Secretary, issued the sources (e.g., tax revenue, non-tax revenue), external sources, and receipts
assailed MC No. 2010-83,9 entitled Full Disclosure of Local Budget and Finances, from loans and borrowings, surplus of prior years, expenditures on general
and Bids and Public Offerings, which aims to promote good governance through services, economic services, social services and debt services, and total
enhanced transparency and accountability of LGUs. The pertinent portion of the expenditures (Source Document - Local Budget Preparation Form No. 2,
issuance reads: titled, Statement of Receipts and Expenditures);
Legal and Administrative Authority 4. CY 2010 Trust Fund (PDAF) Utilization, information detail to the level of
particulars of object expenditures (Source Document - Local Budget
Section 352 of the Local Government Code of 1991 requires the posting within 30 Preparation Form No. 3, titled, Program Appropriation and Obligation by
days from the end of each fiscal year in at least three (3) publicly accessible and Object of Expenditure, limited to PDAF Utilization);
conspicuous places in the local government unit a summary of all revenues collected
and funds received including the appropriations and disbursements of such funds 5. CY 2010 Special Education Fund Utilization, information detail to the level of
during the preceding fiscal year. particulars of object expenditures (Source Document - Local Budget
Preparation Form No. 3, titled, Program Appropriation and Obligation by
On the other hand, Republic Act No. 9184, known as the Government Procurement Object of Expenditure, limited to Special Education Fund);
 6. CY 2010 20% Component of the IRA Utilization, information detail to the
level of particulars of objects of expenditure on social development,
economic development and environmental management (Source Document
- Local Budget Preparation Form No. 3, titled, Program Appropriation and
Obligation by Object of Expenditure, limited to 20% Component of the
Internal Revenue Allotment);
7. CY 2010 Gender and Development Fund Utilization, information detail to the
level of particulars of object expenditures (Source Document - Local Budget
Preparation Form No. 3, titled, Program Appropriation and Obligation by
Object of Expenditure, limited to Gender and Development Fund);
8. CY 2010 Statement of Debt Service, information detail to the level of name
of creditor, purpose of loan, date contracted, term, principal amount,
previous payment made on the principal and interest, amount due for the
budget year and balance of the principal (Source Document - Local Budget
Preparation Form No. 6, titled, Statement of Debt Service);
9. CY 2010 Annual Procurement Plan or Procurement List, information detail
to the level of name of project, individual item or article and specification or
description of goods and services, procurement method, procuring office or
fund source, unit price or estimated cost or approved budget for the contract
and procurement schedule (Source Document - LGU Form No. 02, Makati
City. For sample form, please visit www.makati.gov.ph.)[;]
10. Items to Bid, information detail to the level of individual Invitation to Bid,
containing information as prescribed in Section 21.1 of Republic Act No.
9184, or The Government Procurement Reform Act, to be updated quarterly
(Source Document - Invitation to Apply for Eligibility and to Bid, as
prescribed in Section 21.1 of R.A. No. 9184. For sample form, please
visit www.naga.gov.ph);
11. Bid Results on Civil Works, and Goods and Services, information detail to
the level of project reference number, name and location of project, name
(company and proprietor) and address of winning bidder, bid amount,
approved budget for the contract, bidding date, and contract duration, to be
updated quarterly (Source Document Infrastructure Projects/Goods and
Services Bid-Out (2010), Naga City. For sample form, please
visit www.naga.gov.ph); and
12. Abstract of Bids as Calculated, information detail to the level of project
name, location, implementing office, approved budget for the contract,
quantity and items subject for bidding, and bids of competing bidders, to be
updated quarterly (Source Document - Standard Form No. SF-GOOD-40,
Revised May 24, 2004, Naga City. For sample form, please
visit www.naga.gov.ph).
The foregoing circular also states that non-compliance will be meted sanctions in
accordance with pertinent laws, rules and regulations. 10
11
On December 2, 2010, the respondent issued MC No. 2010-138, reiterating that
20% component of the IRA shall be utilized for desirable social, economic and
environmental outcomes essential to the attainment of the constitutional objective of a
quality of life for all. It also listed the following enumeration of expenses for which the
fund must not be utilized, viz:
1. Administrative expenses such as cash gifts, bonuses, food allowance,
medical assistance, uniforms, supplies, meetings, communication, water
and light, petroleum products, and the like;
2. Salaries, wages or overtime pay;
3. Travelling expenses, whether domestic or foreign;
4. Registration or participation fees in training, seminars, conferences or
conventions;
5. Construction, repair or refinishing of administrative offices;
6. Purchase of administrative office furniture, fixtures, equipment or
appliances; and
7. Purchase, maintenance or repair of motor vehicles or motorcycles, except
ambulances.12
On January 13, 2011, the respondent issued MC No. 2011-08,13 directing for the strict
adherence to Section 90 of R.A. No. 10147 or the General Appropriations Act of 2011.
The pertinent portion of the issuance reads as follows:
Legal and Administrative Authority
Section 90 of Republic Act No. 10147 (General Appropriations Act) FY 2011 re
Use and Disbursement of Internal Revenue Allotment of LGUs, [sic] stipulates:
The amount appropriated for the LGUs share in the Internal Revenue Allotment shall
be used in accordance with Sections 17 (g) and 287 of R.A. No 7160. The annual
budgets of LGUs shall be prepared in accordance with the forms, procedures, and
schedules prescribed by the Department of Budget and Management and those jointly
issued with the Commission on Audit. Strict compliance with Sections 288 and 354 of
R.A. No. 7160 and DILG Memorandum Circular No. 2010-83, entitled Full Disclosure
of Local Budget and Finances, and Bids and Public offering is hereby
mandated;PROVIDED, That in addition to the publication or posting requirement
under Section 352 of R.A. No. 7160 in three (3) publicly accessible and conspicuous
places in the local government unit, the LGUs shall also post the detailed information
on the use and disbursement, and status of programs and projects in the LGUS
websites. Failure to comply with these requirements shall subject the responsible
officials to disciplinary actions in accordance with existing laws. x x x14
x x x x
Sanctions
Non-compliance with the foregoing shall be dealt with in accordance with pertinent
laws, rules and regulations. In particular, attention is invited to the provision of the
Local Government Code of 1991, quoted as follows:chanroblesvirtuallawlibrary
Section 60. Grounds for Disciplinary Actions - An elective local official may be
disciplined, suspended, or removed from office on: (c) Dishonesty, oppression,
misconduct in office, gross negligence, or dereliction of duty . x x x15 (Emphasis
and underscoring in the original)
On February 21, 2011, Villafuerte, then Governor of Camarines Sur, joined by the
Provincial Government of Camarines Sur, filed the instant petition for certiorari,
seeking to nullify the assailed issuances of the respondent for being unconstitutional
and having been issued with grave abuse of discretion.
On June 2, 2011, the respondent filed his Comment on the petition.16 Then, on June
22, 2011, the petitioners filed their Reply (With Urgent Prayer for the Issuance of a
Writ of Preliminary Injunction and/or Temporary Restraining Order). 17 In the
Resolution18 dated October 11, 2011, the Court gave due course to the petition and
directed the parties to file their respective memorandum. In compliance therewith, the
respondent and the petitioners filed their Memorandum on January 19, 2012 19 and on
February 8, 201220 respectively.
The petitioners raised the following issues:
Issues
I
THE HON. SECRETARY OF THE INTERIOR AND LOCAL GOVERNMENT
COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR
EXCESS OF JURISDICTION WHEN HE ISSUED THE ASSAILED MEMORANDUM
CIRCULARS IN VIOLATION OF THE PRINCIPLES OF LOCAL AUTONOMY AND
FISCAL AUTONOMY ENSHRINED IN THE 1987 CONSTITUTION AND THE LOCAL
GOVERNMENT CODE OF 1991[.]
II
THE HON. SECRETARY OF THE INTERIOR AND LOCAL GOVERNMENT
COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR
EXCESS OF JURISDICTION WHEN HE INVALIDLY ASSUMED LEGISLATIVE
POWERS IN PROMULGATING THE ASSAILED MEMORANDUM CIRCULARS
WHICH WENT BEYOND THE CLEAR AND MANIFEST INTENT OF THE 1987
CONSTITUTION AND THE LOCAL GOVERNMENT CODE OF 1991[.]21
Ruling of the Court
The present petition revolves around the main issue: Whether or not the assailed
memorandum circulars violate the principles of local and fiscal autonomy enshrined in
the Constitution and the LGC.
The present petition is ripe for
judicial review.
At the outset, the respondent is questioning the propriety of the exercise of the Courts
power of judicial review over the instant case. He argues that the petition is premature
since there is yet any actual controversy that is ripe for judicial determination. He
points out the lack of allegation in the petition that the assailed issuances had been
fully implemented and that the petitioners had already exhausted administrative
remedies under Section 25 of the Revised Administrative Code before filing the same
in court.22
It is well-settled that the Courts exercise of the power of judicial review requires the
concurrence of the following elements: (1) there must be an actual case or
controversy calling for the exercise of judicial power; (2) the person challenging the act
must have the standing to question the validity of the subject act or issuance;
otherwise stated, he must have a personal and substantial interest in the case such
that he has sustained, or will sustain, direct injury as a result of its enforcement; (3)
the question of constitutionality must be raised at the earliest opportunity; and (4) the
issue of constitutionality must be the very lis mota of the case.23
The respondent claims that there is yet any actual case or controversy that calls for
the exercise of judicial review. He contends that the mere expectation of an
administrative sanction does not give rise to a justiciable controversy especially, in this
case, that the petitioners have yet to exhaust administrative remedies available. 24
The Court disagrees.
In La Bugal-Blaan Tribal Association, Inc. v. Ramos,25 the Court characterized an
actual case or controversy, viz:
An actual case or controversy means an existing case or controversy that is
appropriate or ripe for determination, not conjectural or anticipatory, lest the decision
of the court would amount to an advisory opinion. The power does not extend to
hypothetical questions since any attempt at abstraction could only lead to dialectics
and barren legal questions and to sterile conclusions unrelated to
actualities.26 (Citations omitted)
The existence of an actual controversy in the instant case cannot be overemphasized.
At the time of filing of the instant petition, the respondent had already implemented the
assailed memorandum circulars. In fact, on May 26, 2011, Villafuerte received Audit
Observation Memorandum (AOM) No. 2011-009 dated May 10, 201127 from the Office
of the Provincial Auditor of Camarines Sur, requiring him to comment on the
observation of the audit team, which states:
The Province failed to post the transactions and documents required under
Department of Interior and Local Government (DILG) Memorandum Circular No. 2010-
83, thereby violating the mandate of full disclosure of Local Budget and Finances, and
Bids and Public Offering.
x x x x

The local officials concerned are reminded of the sanctions mentioned in the circular
which is quoted hereunder, thus:
Noncompliance with the foregoing shall be dealt with in accordance with pertinent
laws, rules and regulations. In particular, attention is invited to the provision of Local
Government Code of 1991, quoted as follows:chanroblesvirtuallawlibrary
Section 60. Grounds for Disciplinary Actions An elective local official may be
disciplined, suspended or removed from office on: (c) Dishonesty, oppression,
misconduct in office, gross negligence or dereliction of duty.28
The issuance of AOM No. 2011-009 to Villafuerte is a clear indication that the assailed
issuances of the respondent are already in the full course of implementation. The audit
memorandum specifically mentioned of Villafuertes alleged non-compliance with MC
No. 2010-83 regarding the posting requirements stated in the circular and reiterated
the sanctions that may be imposed for the omission. The fact that Villafuerte is being
required to comment on the contents of AOM No. 2011-009 signifies that the process
of investigation for his alleged violation has already begun. Ultimately, the
investigation is expected to end in a resolution on whether a violation has indeed been
committed, together with the appropriate sanctions that come with it. Clearly,
Villafuertes apprehension is real and well-founded as he stands to be sanctioned for
non-compliance with the issuances.
There is likewise no merit in the respondents claim that the petitioners failure to
exhaust administrative remedies warrants the dismissal of the petition. It bears
emphasizing that the assailed issuances were issued pursuant to the rule-making or
quasi-legislative power of the DILG. This pertains to the power to make rules and
regulations which results in delegated legislation that is within the confines of the
granting statute.29 Not to be confused with the quasi-legislative or rule-making power
of an administrative agency is its quasi-judicial or administrative adjudicatory power.
This is the power to hear and determine questions of fact to which the legislative
policy is to apply and to decide in accordance with the standards laid down by the law
itself in enforcing and administering the same law. 30 In challenging the validity of an
administrative issuance carried out pursuant to the agencys rule-making power, the
doctrine of exhaustion of administrative remedies does not stand as a bar in promptly
resorting to the filing of a case in court. This was made clear by the Court in Smart
Communications, Inc. (SMART) v. National Telecommunications Commission
(NTC),31 where it was ruled, thus:
In questioning the validity or constitutionality of a rule or regulation issued by an
administrative agency, a party need not exhaust administrative remedies before going
to court. This principle applies only where the act of the administrative agency
concerned was performed pursuant to its quasi-judicial function, and not when the
assailed act pertained to its rule-making or quasi-legislative power. x x x.32
Considering the foregoing clarification, there is thus no bar for the Court to resolve the
substantive issues raised in the petition.
The assailed memorandum circulars
do not transgress the local and fiscal
autonomy granted to LGUs.
The petitioners argue that the assailed issuances of the respondent interfere with the
local and fiscal autonomy of LGUs embodied in the Constitution and the LGC. In
particular, they claim that MC No. 2010-138 transgressed these constitutionally-
protected liberties when it restricted the meaning of development and enumerated
activities which the local government must finance from the 20% development fund
component of the IRA and provided sanctions for local authorities who shall use the
said component of the fund for the excluded purposes stated therein.33 They argue
that the respondent cannot substitute his own discretion with that of the local
legislative council in enacting its annual budget and specifying the development
projects that the 20% component of its IRA should fund.34
The argument fails to persuade.
The Constitution has expressly adopted the policy of ensuring the autonomy of
LGUs.35 To highlight its significance, the entire Article X of the Constitution was
devoted to laying down the bedrock upon which this policy is anchored.
It is also pursuant to the mandate of the Constitution of enhancing local autonomy that
the LGC was enacted. Section 2 thereof was a reiteration of the state policy. It reads,
thus:
Sec. 2. Declaration of Policy. (a) It is hereby declared the policy of the State that the
territorial and political subdivisions of the State shall enjoy genuine and meaningful
local autonomy to enable them to attain their fullest development as self-reliant
communities and make them more effective partners in the attainment of national
goals. Toward this end, the State shall provide for a more responsive and accountable
local government structure instituted through a system of decentralization whereby
local government units shall be given more powers, authority, responsibilities, and
resources. The process of decentralization shall proceed from the national
government to the local government units.
Verily, local autonomy means a more responsive and accountable local government
structure instituted through a system of decentralization.36 In Limbona v.
Mangelin,37 the Court elaborated on the concept of decentralization, thus:
[A]utonomy is either decentralization of administration or decentralization of power.
There is decentralization of administration when the central government delegates
administrative powers to political subdivisions in order to broaden the base of
government power and in the process to make local governments more responsive
and accountable, and ensure their fullest development as self-reliant communities
and make them more effective partners in the pursuit of national development and
social progress. At the same time, it relieves the central government of the burden of
managing local affairs and enables it to concentrate on national concerns. x x x.
Decentralization of power, on the other hand, involves an abdication of political power
in the favor of local governments [sic] units declared to be autonomous. In that case,
the autonomous government is free to chart its own destiny and shape its future with
minimum intervention from central authorities. x x x.38 (Citations omitted)
To safeguard the state policy on local autonomy, the Constitution confines the power
of the President over LGUs to mere supervision.39 The President exercises general
supervision over them, but only to ensure that local affairs are administered
according to law. He has no control over their acts in the sense that he can substitute
their judgments with his own.40 Thus, Section 4, Article X of the Constitution, states:
Section 4. The President of the Philippines shall exercise general supervision over
local governments. Provinces with respect to component cities and municipalities, and
cities and municipalities with respect to component barangays, shall ensure that the
acts of their component units are within the scope of their prescribed powers and
functions.
In Province of Negros Occidental v. Commissioners, Commission on Audit, 41 the Court
distinguished general supervision from executive control in the following manner:
The Presidents power of general supervision means the power of a superior officer to
see to it that subordinates perform their functions according to law. This is
distinguished from the Presidents power of control which is the power to alter or
modify or set aside what a subordinate officer had done in the performance of his
duties and to substitute the judgment of the President over that of the subordinate
officer. The power of control gives the President the power to revise or reverse the
acts or decisions of a subordinate officer involving the exercise of
discretion.42 (Citations omitted)
It is the petitioners contention that the respondent went beyond the confines of his
supervisory powers, as alter ego of the President, when he issued MC No. 2010-138.
They argue that the mandatory nature of the circular, with the threat of imposition of
sanctions for non-compliance, evinces a clear desire to exercise control over LGUs. 43
The Court, however, perceives otherwise.
A reading of MC No. 2010-138 shows that it is a mere reiteration of an existing
provision in the LGC. It was plainly intended to remind LGUs to faithfully observe the
directive stated in Section 287 of the LGC to utilize the 20% portion of the IRA for
development projects. It was, at best, an advisory to LGUs to examine themselves if
they have been complying with the law. It must be recalled that the assailed circular
was issued in response to the report of the COA that a substantial portion of the 20%
development fund of some LGUs was not actually utilized for development projects
but was diverted to expenses more properly categorized as MOOE, in violation of
Section 287 of the LGC. This intention was highlighted in the very first paragraph of
MC No. 2010-138, which reads:
Section 287 of the Local Government Code mandates every local government to
appropriate in its annual budget no less than 20% of its annual revenue allotment for
development projects. In common understanding, development means the realization
of desirable social, economic and environmental outcomes essential in the attainment
of the constitutional objective of a desired quality of life for all.44 (Underscoring in the
original)
That the term development was characterized as the realization of desirable social,
economic and environmental outcome does not operate as a restriction of the term so
as to exclude some other activities that may bring about the same result. The
definition was a plain characterization of the concept of development as it is commonly
understood. The statement of a general definition was only necessary to illustrate
among LGUs the nature of expenses that are properly chargeable against the
development fund component of the IRA. It is expected to guide them and aid them in
rethinking their ways so that they may be able to rectify lapses in judgment, should
there be any, or it may simply stand as a reaffirmation of an already proper
administration of expenses.
The same clarification may be said of the enumeration of expenses in MC No. 2010-
138. To begin with, it is erroneous to call them exclusions because such a term
signifies compulsory disallowance of a particular item or activity. This is not the
contemplation of the enumeration. Again, it is helpful to retrace the very reason for the
issuance of the assailed circular for a better understanding. The petitioners should be
reminded that the issuance of MC No. 2010-138 was brought about by the report of
the COA that the development fund was not being utilized accordingly. To curb the
alleged misuse of the development fund, the respondent deemed it proper to remind
LGUs of the nature and purpose of the provision for the IRA through MC No. 2010-
138. To illustrate his point, he included the contested enumeration of the items for
which the development fund must generally not be used. The enumerated items
comprised the expenses which the COA perceived to have been improperly
earmarked or charged against the development fund based on the audit it conducted.
Contrary to the petitioners posturing, however, the enumeration was not meant to
restrict the discretion of the LGUs in the utilization of their funds. It was meant to
enlighten LGUs as to the nature of the development fund by delineating it from other
types of expenses. It was incorporated in the assailed circular in order to guide them
in the proper disposition of the IRA and avert further misuse of the fund by citing
current practices which seemed to be incompatible with the purpose of the fund. Even
then, LGUs remain at liberty to map out their respective development plans solely on
the basis of their own judgment and utilize their IRAs accordingly, with the only
restriction that 20% thereof be expended for development projects. They may even
spend their IRAs for some of the enumerated items should they partake of indirect
costs of undertaking development projects. In such case, however, the concerned
LGU must ascertain that applicable rules and regulations on budgetary allocation have
been observed lest it be inviting an administrative probe.
The petitioners likewise misread the issuance by claiming that the provision of
sanctions therein is a clear indication of the Presidents interference in the fiscal
autonomy of LGUs. The relevant portion of the assailed issuance reads, thus:
All local authorities are further reminded that utilizing the 20% component of the
Internal Revenue Allotment, whether willfully or through negligence, for any purpose
beyond those expressly prescribed by law or public policy shall be subject to the
sanctions provided under the Local Government Code and under such other
applicable laws.45
Significantly, the issuance itself did not provide for sanctions. It did not particularly
establish a new set of acts or omissions which are deemed violations and provide the
corresponding penalties therefor. It simply stated a reminder to LGUs that there are
existing rules to consider in the disbursement of the 20% development fund and that
non-compliance therewith may render them liable to sanctions which are provided in
the LGC and other applicable laws. Nonetheless, this warning for possible imposition
of sanctions did not alter the advisory nature of the issuance.
At any rate, LGUs must be reminded that the local autonomy granted to them does not
completely severe them from the national government or turn them into impenetrable
states. Autonomy does not make local governments sovereign within the
state.46 In Ganzon v. Court of Appeals,47 the Court reiterated:
Autonomy, however, is not meant to end the relation of partnership and
interdependence between the central administration and local government units, or
otherwise, to usher in a regime of federalism. The Charter has not taken such a
radical step. Local governments, under the Constitution, are subject to regulation,
however limited, and for no other purpose than precisely, albeit paradoxically, to
enhance self-government.48
Thus, notwithstanding the local fiscal autonomy being enjoyed by LGUs, they are still
under the supervision of the President and maybe held accountable for malfeasance
or violations of existing laws. Supervision is not incompatible with discipline. And the
power to discipline and ensure that the laws be faithfully executed must be construed
to authorize the President to order an investigation of the act or conduct of local
officials when in his opinion the good of the public service so requires. 49
Clearly then, the Presidents power of supervision is not antithetical to investigation
and imposition of sanctions. In Hon. Joson v. Exec. Sec. Torres,50 the Court pointed
out, thus:
Independently of any statutory provision authorizing the President to conduct an
investigation of the nature involved in this proceeding, and in view of the nature and
character of the executive authority with which the President of the Philippines is
invested, the constitutional grant to him of power to exercise general supervision over
all local governments and to take care that the laws be faithfully executed must be
construed to authorize him to order an investigation of the act or conduct of the
petitioner herein. Supervision is not a meaningless thing. It is an active power. It is
certainly not without limitation, but it at least implies authority to inquire into facts and
conditions in order to render the power real and effective. x x x.51 (Emphasis ours and
italics in the original)
As in MC No. 2010-138, the Court finds nothing in two other questioned issuances of
the respondent, i.e., MC Nos. 2010-83 and 2011-08, that can be construed as
infringing on the fiscal autonomy of LGUs. The petitioners claim that the requirement
to post other documents in the mentioned issuances went beyond the letter and spirit
of Section 352 of the LGC and R.A. No. 9184, otherwise known as the Government
Procurement Reform Act, by requiring that budgets, expenditures, contracts and
loans, and procurement plans of LGUs be publicly posted as well.52
Pertinently, Section 352 of the LGC reads:
Section 352. Posting of the Summary of Income and Expenditures. Local
treasurers, accountants, budget officers, and other accountable officers shall, within
thirty (30) days from the end of the fiscal year, post in at least three (3) publicly
accessible and conspicuous places in the local government unit a summary of all
revenues collected and funds received including the appropriations and
disbursements of such funds during the preceding fiscal year.
R.A. No. 9184, on the other hand, requires the posting of the invitation to bid, notice of
award, notice to proceed, and approved contract in the procuring entitys premises, in
newspapers of general circulation, and the website of the procuring entity.53
It is well to remember that fiscal autonomy does not leave LGUs with unbridled
discretion in the disbursement of public funds. They remain accountable to their
constituency. For, public office was created for the benefit of the people and not the
person who holds office.
The Court strongly enunciated in ABAKADA GURO Party List (formerly AASJS), et al.
v. Hon. Purisima, et al.,54 thus:
Public office is a public trust. It must be discharged by its holder not for his own
personal gain but for the benefit of the public for whom he holds it in trust. By
demanding accountability and service with responsibility, integrity, loyalty, efficiency,
patriotism and justice, all government officials and employees have the duty to be
responsive to the needs of the people they are called upon to serve.55
Thus, the Constitution strongly summoned the State to adopt and implement a policy
of full disclosure of all transactions involving public interest and provide the people
with the right to access public information.56 Section 352 of the LGC is a response to
this call for transparency. It is a mechanism of transparency and accountability of local
government officials and is in fact incorporated under Chapter IV of the LGC which
deals with Expenditures, Disbursements, Accounting and Accountability.
In the same manner, R.A. No. 9184 established a system of transparency in the
procurement process and in the implementation of procurement contracts in
government agencies.57 It is the public monitoring of the procurement process and the
implementation of awarded contracts with the end in view of guaranteeing that these
contracts are awarded pursuant to the provisions of the law and its implementing rules
and regulations, and that all these contracts are performed strictly according to
specifications.58
The assailed issuances of the respondent, MC Nos. 2010-83 and 2011-08, are but
implementation of this avowed policy of the State to make public officials accountable
to the people. They are amalgamations of existing laws, rules and regulation designed
to give teeth to the constitutional mandate of transparency and accountability.
 implements a policy of full public disclosure of all its transactions involving public
A scrutiny of the contents of the mentioned issuances shows that they do not, in any interest.
manner, violate the fiscal autonomy of LGUs. To be clear, [f]iscal autonomy means
that local governments have the power to create their own sources of revenue in Article III
addition to their equitable share in the national taxes released by the national Bill of Rights
government, as well as the power to allocate their resources in accordance with their
own priorities. It extends to the preparation of their budgets, and local officials in turn Section 7. The right of the people to information on matters of public concern shall be
have to work within the constraints thereof.59 recognized. Access to official records, and to documents and papers pertaining to
official acts, transactions, or decisions, as well as to government research data used
It is inconceivable, however, how the publication of budgets, expenditures, contracts as basis for policy development, shall be afforded the citizen, subject to such
and loans and procurement plans of LGUs required in the assailed issuances could limitations as may be provided by law.
have infringed on the local fiscal autonomy of LGUs. Firstly, the issuances do not
interfere with the discretion of the LGUs in the specification of their priority projects
and the allocation of their budgets. The posting requirements are mere transparency In the instant case, the assailed issuances were issued pursuant to the policy of
measures which do not at all hurt the manner by which LGUs decide the utilization promoting good governance through transparency, accountability and participation.
and allocation of their funds. The action of the respondent is certainly within the constitutional bounds of his power
as alter ego of the President.
Secondly, it appears that even Section 352 of the LGC that is being invoked by the
petitioners does not exclude the requirement for the posting of the additional It is needless to say that the power to govern is a delegated authority from the people
documents stated in MC Nos. 2010-83 and 2011-08. Apparently, the mentioned who hailed the public official to office through the democratic process of election. His
provision requires the publication of a summary of revenues collected and funds stay in office remains a privilege which may be withdrawn by the people should he
received, including the appropriations and disbursements of such funds. The betray his oath of office. Thus, he must not frown upon accountability checks which
additional requirement for the posting of budgets, expenditures, contracts and loans, aim to show how well he is performing his delegated power. For, it is through these
and procurement plans are well-within the contemplation of Section 352 of the LGC mechanisms of transparency and accountability that he is able to prove to his
considering they are documents necessary for an accurate presentation of a summary constituency that he is worthy of the continued privilege.
of appropriations and disbursements that an LGU is required to publish.
WHEREFORE, in view of the foregoing considerations, the petition is DISMISSED for
Finally, the Court believes that the supervisory powers of the President are broad lack of merit.
enough to embrace the power to require the publication of certain documents as a
mechanism of transparency. InPimentel, Jr. v. Hon. Aguirre,60 the Court reminded that SO ORDERED.
local fiscal autonomy does not rule out any manner of national government
intervention by way of supervision, in order to ensure that local programs, fiscal and
otherwise, are consistent with national goals. The President, by constitutional fiat, is
the head of the economic and planning agency of the government, primarily
responsible for formulating and implementing continuing, coordinated and integrated EN BANC
social and economic policies, plans and programs for the entire country. 61
G.R. No. 199439 April 22, 2014
Moreover, the Constitution, which was drafted after long years of dictatorship and CITY OF GENERAL SANTOS, represented by its Mayor, HON. DARLENE
abuse of power, is now replete with numerous provisions directing the adoption of MAGNOLIA R. ANTONINO-CUSTODIO Petitioner,
measures to uphold transparency and accountability in government, with a view of vs.
protecting the nation from repeating its atrocious past. In particular, the Constitution COMMISSION ON AUDIT, Respondent.
commands the strict adherence to full disclosure of information on all matters relating
to official transactions and those involving public interest. Pertinently, Section 28, DECISION
Article II and Section 7, Article III of the Constitution, provide:
LEONEN, J.:
Article II
In order to be able to deliver more effective and efficient services, the law allows local
Declaration of Principles and State Policies Principles
government units the power to reorganize. In doing so, they should be given leeway to
entice their employees to avail of severance benefits that the local government can
Section 28. Subject to reasonable conditions prescribed by law, the State adopts and afford. However, local government units may not provide such when it amounts to a
supplementary retirement benefit scheme.
In this special civil action for certiorari, 1 the city of General Santos asks us to find
grave abuse of discretion on the part of the Commission on Audit (COA). On January
20, 2011, respondent Commission on Audit affirmed the findings of its Legal Services
Sector in its Opinion No. 2010-021 declaring Ordinance No. 08, series of 2009, as
illegal. This was reiterated in respondent Commissions resolution denying the motion
for reconsideration dated October 17, 2011.2
Ordinance No. 08, series of 2009, was enacted by the city of General Santos on
August 13, 2009. It is entitled An Ordinance Establishing the GenSan Scheme on
Early Retirement for Valued Employees Security (GenSan SERVES). 3
It is important to view this ordinance in its proper context.
Then mayor of General Santos City, Pedro B. Acharon, Jr., issued Executive Order
No. 40, series of 2008, creating management teams pursuant to its organization
development program. This was patterned after Executive Order No. 366 dated
October 4, 2004 entitled Directing a Strategic Review of the Operations and
Organizations of the Executive Branch and Providing Options and Incentives for
Government Employees who may be Affected by the Rationalization of the Functions
and Agencies of the Executive Branch and its implementing rules and regulations. 4
Mayor Pedro B. Acharon, Jr. declared the citys byword of "Total Quality Service" in
his state of the city address in 2005. This was followed by the conduct of a process
and practice review for each department, section, and unit of the local government.
The product was an organization development masterplan adopted as Executive
Order No. 13, series of 2009.5
This was followed by Resolution No. 004, series of 2009, requesting for the mayors
support for GenSan SERVES, an early retirement program to be proposed to the
Sangguniang Panlungsod.
Consequently, Ordinance No. 08, series of 2009, was passed together with its
implementing rules and regulations, designed "to entice those employees who were
unproductive due to health reasons to avail of the incentives being offered therein by
way of early retirement package."6
This contextual background in the passing of Ordinance No. 08, series of 2009, was
not contested by respondent Commission on Audit.
The ordinance, as amended, provides that qualified employees below sixty (60) years
of age but not less than fifty (50) years and sickly employees below fifty (50) years of
age but not less than forty (40) years may avail of the incentives under the
program.7 In other words, the ordinance "provides for separation benefits for sickly
employees who have not yet reached retirement age."8 Section 5 of the ordinance
states:
Section 5. GenSan SERVES Program Incentives On Top of Government Service
Insurance System (GSIS) and PAG-IBIG Benefits Any personnel qualified and
approved to receive the incentives of this program shall be entitled to whatever
retirement benefits the GSIS or PAG-IBIG is granting to a retiring government
employee.
Moreover, an eligible employee shall receive an early retirement incentive provided
under this program at the rate of one and one-half (1 1/2) months of the employees
latest basic salary for every year of service in the City Government.9
Also, the ordinance provides:
Section 6. GenSan SERVES Post-Retirement Incentives Upon availment of early
retirement, a qualified employee shall enjoy the following in addition to the above
incentives:
(a) Cash gift of Fifty Thousand Pesos (P50,000.00) for the sickly
employees;
(b) Lifetime free medical consultation at General Santos City Hospital;
(c) Annual aid in the maximum amount of Five Thousand Pesos
(P5,000.00), if admitted at General Santos City Hospital; and
(d) 14 karat gold ring as a token.10
As provided, payment would be made in two tranches: 50% paid in January 2010 and
the remainder in July 2010.11Petitioner city alleged that out of its 1,361 regular
employees, 50 employees applied, from which 39 employees qualified to avail of the
incentives provided by the ordinance.12 The first tranche of benefits was released in
January 2010.13
In a letter dated February 10, 2010, the citys audit team leader, through its
supervising auditor, sent a query on the legality of the ordinance to respondent
Commission on Audits director for Regional Office No. XII, Cotabato City. 14
In his second indorsement dated March 15, 2010, respondent Commissions regional
director agreed that the grant lacked legal basis and was contrary to the Government
Service Insurance System (GSIS) Act. He forwarded the matter to respondent
Commissions Office of General Counsel, Legal Services Sector, for a more
authoritative opinion.15
The Office of General Counsel issued COA-LSS Opinion No. 2010-021 on March 25,
2010. The opinion explained that Ordinance No. 08, series of 2009, partakes of a
supplementary retirement benefit plan. In its view, Section 28, paragraph (b) of
Commonwealth Act No. 186, as amended, prohibits government agencies from
establishing supplementary retirement or pension plans from the time the Government
Service Insurance System charter took effect while those plans already existing when
the charter was enacted were declared abolished.16
The opinion discussed that this prohibition was reiterated in Conte v. Commission on
Audit.17 Larao v. Commission on Audit,18 on the other hand, ruled that an early
retirement program should be by virtue of a valid reorganization pursuant to law in
order to be valid. The opinion concludes as follows:
In fine, since Ordinance No. 08 is in the nature of an ERP [Early Retirement Program]
of the City Government of General Santos, a law authorizing the same is a requisite
for its validity. In the absence, however, of such law, the nullity of Ordinance No. 08
becomes a necessary consequence.
It is hoped that the foregoing sufficiently answers the instant query.19
Petitioner city, through then mayor, Pedro B. Acharon, Jr., filed a letter-reconsideration
dated June 7, 2010. They followed through with two letters addressed to respondent
Commissions chairman dated July 26, 2010 and October 6, 2010, respectively, for the
reconsideration of COA-LSS Opinion No. 2010-021.20
Respondent Commission on Audit treated these letters as an appeal. On January 20,
2011, it rendered its decision denying the appeal and affirming COA-LSS Opinion No.
2010-021.21 It also denied reconsideration by resolution dated October 17, 2011. 22 The
dispositive portion of its decision reads:
WHEREFORE, premises considered, the instant appeal is hereby DENIED for lack of
merit and COA-LSS Opinion No. 2010-021 dated March 25, 2010 of the OGC, this
Commission is hereby AFFIRMED. Accordingly, the ATL of General Santos City is
hereby directed to issue a Notice of Disallowance on the illegal disbursements made
under the Gen[S]san SERVES.23
Respondent Commission on Audit agreed that Ordinance No. 08, series of 2009,
partakes of the nature of a supplementary retirement benefit plan proscribed by
Section 28, paragraph (b) of Commonwealth Act No. 186 as amended. It also cited
Conte v. Commission on Audit24 and Larao v. Commission on Audit.25
In its opinion, respondent Commission on Audit observed that GenSan SERVES was
not based on a law passed by Congress but on ordinances and resolutions passed
and approved by the Sangguniang Panlungsod and Executive Orders by the city
mayor.26 Moreover, nowhere in Section 76 of Republic Act No. 7160, otherwise known
as the Local Government Code, does it provide a specific power for local government
units to establish an early retirement program.
Mayor Acharon, Jr. submitted that other local government units such as Cebu in 2005
and 2008 have adopted their own early retirement programs. The resolutions of the
Sangguniang Panlungsod of Cebu invoked Republic Act No. 6683 dated December 2,
1988, which provided for early retirement and voluntary separation. The questioned
decision mentioned that respondent Commission on Audit would look into this
program supposedly adopted by Cebu.27 Assuming Cebus invocation of Republic Act
No. 6683 was proper, respondent Commission on Audit explained that this has
already been amended by Republic Act No. 8291, otherwise known as the GSIS Act
of 1997. Moreover, Section 9 of Republic Act No. 668328 provides for limited
application.29
The present petition raises this sole issue:
WHETHER RESPONDENT COMMISSION ON AUDIT COMMITTED GRAVE ABUSE
OF DISCRETION WHEN IT CONSIDERED ORDINANCE NO. 08, SERIES OF 2009,
IN THE NATURE OF AN EARLY RETIREMENT PROGRAM REQUIRING A LAW
AUTHORIZING IT FOR ITS VALIDITY
I except as hereinafter provided."
This court has consistently held that findings of administrative agencies are generally
respected, unless found to have been tainted with unfairness that amounted to grave
abuse of discretion:
It is the general policy of the Court to sustain the decisions of administrative
authorities, especially one which is constitutionally-created not only on the basis of the
doctrine of separation of powers but also for their presumed expertise in the laws they
are entrusted to enforce. Findings of administrative agencies are accorded not only
respect but also finality when the decision and order are not tainted with unfairness or
arbitrariness that would amount to grave abuse of discretion. It is only when the COA
has acted without or in excess of jurisdiction, or with grave abuse of discretion
amounting to lack or excess of jurisdiction, that this Court entertains a petition
questioning its rulings. There is grave abuse of discretion when there is an evasion of
a positive duty or a virtual refusal to perform a duty enjoined by law or to act in
contemplation of law as when the judgment rendered is not based on law and
evidence but on caprice, whim and despotism. 30 (Emphasis supplied, citations
omitted)
We have ruled that "not every error in the proceedings, or every erroneous conclusion
of law or fact, constitutes grave abuse of discretion." 31 Grave abuse of discretion has
been defined as follows:
By grave abuse of discretion is meant such capricious and whimsical exercise of
judgment as is equivalent to lack of jurisdiction. Mere abuse of discretion is not
enough. It must be grave abuse of discretion as when the power is exercised in an
arbitrary or despotic manner by reason of passion or personal hostility, and must be
so patent and so gross as to amount to an evasion of a positive duty or to a virtual
refusal to perform the duty enjoined or to act at all in contemplation of law. x x x.32
In Yap v. Commission on Audit,33 this court explained that the Commission on Audit
has the duty to make its own assessment of the merits of the disallowance and need
not be limited to a review of the grounds relied upon by the auditor of the agency
concerned:
x x x we rule that, in resolving cases brought before it on appeal, respondent COA is
not required to limit its review only to the grounds relied upon by a government
agencys auditor with respect to disallowing certain disbursements of public funds. In
consonance with its general audit power, respondent COA is not merely legally
permitted, but is also duty-bound to make its own assessment of the merits of the
disallowed disbursement and not simply restrict itself to reviewing the validity of the
ground relied upon by the auditor of the government agency concerned. To hold
otherwise would render COAs vital constitutional power unduly limited and thereby
useless and ineffective.34
Moreover, Article IX-A, Section 7 of the Constitution provides that "unless otherwise
provided by this Constitution or by law, any decision, order, or ruling of each
Commission may be brought to the Supreme Court on certiorari by the aggrieved
party within thirty days from receipt of a copy thereof." Rule 64, Section 2 of the
Revised Rules of Civil Procedure also provides that "a judgment or final order or
resolution of the Commission on Elections and the Commission on Audit may be
brought by the aggrieved party to the Supreme Court on certiorari under Rule 65,
Thus, we proceed to determine whether respondent Commission on Audit acted with
grave abuse of discretion in affirming the opinion of its Legal Services Sector and
finding that the entire Ordinance No. 08, series of 2009, partakes of the nature of a
proscribed supplementary retirement benefit plan.
II
According to petitioner city, GenSan SERVES does not provide for supplementary
retirement benefits, and Conte does not apply.35
Petitioner city explains that unlike the facts in Conte, Ordinance No. 08, series of
2009, was designed to entice employees who are unproductive due to health reasons
to avail of the incentives by way of an early retirement package. In essence, the
incentives are severance pay. Those who have reached retirement age are
disqualified.36
Petitioner city adds that GenSan SERVES is a one-time offer. It is available only to
qualified employees who applied within two months from the ordinances effectivity. In
fact, out of its 1,361 regular employees, 50 employees applied. Out of all that applied,
only 39 employees qualified to avail of the incentives provided by the ordinance. 37
These incentives are independent and distinct from the Government Service
Insurance System retirement package.38
Section 5 of Ordinance No. 08, series of 2009, was amended by Ordinance No. 11,
series of 2009, "to exclude those GSIS and PAG-IBIG benefits the payment[s] of
which are passed on [to] the employer."39 This was to remove any doubt as to its
coverage and applicability and to ensure that no employee will be paid twice.40 The
amended provision reads:
Section 5. Gen[S]an SERVES Program Incentives On Top of Government Service
Insurance System (GSIS) and PAG-IBIG Benefits Any personnel qualified and
approved to receive the incentives of this program shall be entitled to whatever
retirement benefits the GSIS or PAG-IBIG is granting to a retiring government
employee, except those benefits the payment of which are passed on to the employer.
In which case, the benefits granted under this ordinance shall only be considered as
one of the options available to a retiring city employee.
Moreover, an eligible employee shall receive an early retirement incentive provided
under this program at the rate of one and one-half (1 1/2) months of the employees
latest basic salary for every year of service in the City Government. (Emphasis
supplied)
According to petitioner city, GenSan SERVES is an initial step pursuant to its
organization development masterplan,41 which began with the city mayors issuance of
Executive Order No. 40, series of 2008, creating change management teams.42
Petitioner city cites Sections 16 and 76 of the Local Government Code as its authority
to reorganize. It argues that these provisions necessarily imply the authority of
petitioner city to provide retirement benefits, separation pay, and other incentives to
those affected by the reorganization.43
Petitioner city also cites Republic Act No. 6656, otherwise known as An Act to Protect
the Security of Tenure of Civil Service Officers and Employees in the Implementation
of Government Reorganization.44 According to petitioner city, this not only requires
good faith in the implementation of reorganization but mandates the payment of
appropriate separation pay, retirement, and other benefits under existing laws within
90 days from effectivity date of separation.45
Even President Gloria Macapagal-Arroyo issued Executive Order No. 184 entitled
Directing the Reorganization and Streamlining of the National Development Company
on March 10, 2003. In Section 4, it provides for a separation package anchored on
Republic Act No. 6656.46 Petitioner city submits that if the President can reorganize in
the absence of any law authorizing her to do so and provide compensation based on
Republic Act No. 6656, with more reason that a local government unit can reorganize
as its power to reorganize is expressly provided in the Local Government Code. 47
Respondent Commission on Audit counters that it correctly found Ordinance No. 08,
series of 2009, as invalid in the absence of a law passed by Congress specifically
authorizing the enactment of an ordinance granting an early retirement scheme. 48
Respondent Commission on Audit contends that Sections 16 and 76 of the Local
Government Code do not confer authority upon any local government unit to create a
separate or supplementary retirement benefit plan.49 As for Republic Act No. 6656,
this contemplates situations where a government position has been abolished, or
rendered redundant, or a need to merge, divide or consolidate positions for lawful
causes allowed by the Civil Service Law exists.50
According to respondent Commission on Audit, petitioner city failed to demonstrate
arbitrariness on its part as it merely observed the proscription under Section 28,
paragraph (b) of Commonwealth Act No. 186 when it found the ordinance a nullity. 51
We agree with respondent Commission on Audit but only insofar as Section 5 of the
ordinance is concerned. We declare Section 6 on post-retirement incentives as valid.
III
The constitutional mandate for local autonomy supports petitioner citys issuance of
Executive Order No. 40, series of 2008, creating change management teams as an
initial step for its organization development masterplan.
Local autonomy also grants local governments the power to streamline and
reorganize. This power is inferred from Section 76 of the Local Government Code on
organizational structure and staffing pattern, and Section 16 otherwise known as the
general welfare clause:
Section 76. Organizational Structure and Staffing Pattern. - Every local government
unit shall design and implement its own organizational structure and staffing pattern
taking into consideration its service requirements and financial capability, subject to
the minimum standards and guidelines prescribed by the Civil Service Commission.
Section 16. General Welfare. - Every local government unit shall exercise the powers
expressly granted, those necessarily implied therefrom, as well as powers necessary,
appropriate, or incidental for its efficient and effective governance, and those which
are essential to the promotion of the general welfare. Within their respective territorial
jurisdictions, local government units shall ensure and support, among other things, the
preservation and enrichment of culture, promote health and safety, enhance the right
of the people to a balanced ecology, encourage and support the development of
appropriate and self-reliant scientific and technological capabilities, improve public
morals, enhance economic prosperity and social justice, promote full employment
among their residents, maintain peace and order, and preserve the comfort and
convenience of their inhabitants.
Section 5, paragraph (a) of the Local Government Code states that "any provision on
a power of a local government unit shall be liberally interpreted in its favor, and in case
of doubt, any question thereon shall be resolved in favor or devolution of powers x x
x."
Section 5, paragraph (c) also provides that "the general welfare provisions in this
Code shall be liberally interpreted to give more powers to local government units in
accelerating economic development and upgrading the quality of life for the people in
the community." These rules of interpretation emphasize the policy of local autonomy
and the devolution of powers to the local government units.
Designing and implementing a local government units own "organizational structure
and staffing pattern" also implies the power to revise and reorganize. Without such
power, local governments will lose the ability to adjust to the needs of its constituents.
Effective and efficient governmental services especially at the local government level
require rational and deliberate changes planned and executed in good faith from time
to time.
This was implied in Province of Negros Occidental v. Commissioners, Commission on
Audit.53 In that case, this court declared as valid the ordinance passed by the province
granting and releasing hospitalization and health care insurance benefits to its officials
and employees. This court held that Section 2 of Administrative Order No.
10354requiring the Presidents prior approval before the grant of any allowance or
benefit is applicable only to offices under the executive branch. 55 Section 2 does not
mention local government units, thus, the prohibition does not apply to them. 56 This
court then referred to the policy of local autonomy as follows:
Thus, consistent with the state policy of local autonomy as guaranteed by the 1987
Constitution, under Section 25, Article II and Section 2, Article X, and the Local
Government Code of 1991, we declare that the grant and release of the hospitalization
and health care insurance benefits given to petitioners officials and employees were
validly enacted through an ordinance passed by petitioners Sangguniang
Panlalawigan.
Local autonomy allows an interpretation of Sections 76 and 16 as granting petitioner
city the authority to create its organization development program.
Petitioner citys vision in 2005 of "Total Quality Service" for "the improvement of the
quality of services delivered by the city to the delight of its internal and external
customers"58 is a matter within its discretion. It then conducted a process and practice
review for each and every unit within the city, resulting in the formulation of an
organization development masterplan adopted as Executive Order No. 13, series of
2009.59
Resolution No. 004, series of 2009, was later passed requesting for the mayors
support for GenSan SERVES. The third preambular clause states that in order "to
transform the bureaucracy into [an] effective and result[s]-oriented structure,
redounding to improved governance, there is a need to entice employees aged 50-59
years old, to retire earlier than [age] 65 for them to enjoy their retirement while they
are still healthy."60 Consequently, Ordinance No. 08, series of 2009, was passed
creating the GenSan SERVES program.
In Betoy v. The Board of Directors, NAPOCOR,61 this court explained that a
streamlining of organization for a more efficient system must pass the test of good
faith in order to be valid:
A reorganization involves the reduction of personnel, consolidation of offices, or
abolition thereof by reason of economy or redundancy of functions.62 It could result in
the loss of one's position through removal or abolition of an office. However, for a
reorganization for the purpose of economy or to make the bureaucracy more efficient
to be valid, it must pass the test of good faith; otherwise, it is void ab
initio.63 (Emphasis supplied)
There are indicia of bad faith, none of which are present in this case.
Republic Act No. 6656 invoked by petitioner city as authority for the creation of
GenSan SERVES, for example, enumerates situations considered as bad faith when
employees are removed as a result of any reorganization:
SECTION 2. No officer or employee in the career service shall be removed except for
a valid cause and after due notice and hearing. A valid cause for removal exists when,
pursuant to a bona fide reorganization, a position has been abolished or rendered
redundant or there is a need to merge, divide, or consolidate positions in order to meet
the exigencies of the service, or other lawful causes allowed by the Civil Service Law.
The existence of any or some of the following circumstances may be considered as
evidence of bad faith in the removals made as a result of reorganization, giving rise to
a claim for reinstatement or reappointment by an aggrieved party:
a) Where there is a significant increase in the number of positions in the
new staffing pattern of the department or agency concerned;
b) Where an office is abolished and another performing substantially the
same functions in created;
c) Where incumbents are replaced by those less qualified in terms of status
of appointment, performance and merit;
d) Where there is a reclassification of offices in the department or agency
concerned and the reclassified offices perform substantially the same
functions as the original offices; and
e) Where the removal violates the order of separation provided in Section 3
hereof. (Emphasis supplied)
None of these badges of bad faith exist in this case.
Petitioner city followed the order of priority under Section 4 of its ordinance. 64 It
required applicants to undergo medical examination with the local hospital and
considered the hospital chiefs recommendations.65
Unfortunately, these allegations showing good faith is not enough to declare the
program created by petitioner city as a reorganization that justifies the creation of a
retirement benefit plan.
Petitioner city alleged that the positions occupied by those who qualified for GenSan
SERVES remained vacant, and it would neither hire replacements nor promote
employees earlier than June 30, 2011.66 This means the positions left by those who
availed of the program will eventually be filled up by others. Their positions were not
abolished or merged with other positions for streamlining in the service.
IV
The assailed decision by respondent Commission on Audit was anchored on Section
28, paragraph (b) of Commonwealth Act No. 186, otherwise known as the
Government Service Insurance Act,67 as amended by Republic Act No. 4968.68 This
proscribes all supplementary retirement or pension plans for government employees:
(b) Hereafter no insurance or retirement plan for officers or employees shall be
created by any employer. All supplementary retirement or pension plans heretofore in
force in any government office, agency, or instrumentality or corporation owned and
controlled by the government, are hereby declared inoperative or abolished: Provided,
That the rights of those who are already eligible to retire thereunder shall not be
affected.
Jurisprudence has discussed the nature and purpose of retirement benefits and
pension plans as follows:
Retirement benefits are, after all, a form of reward for an employees loyalty and
service to the employer, and are intended to help the employee enjoy the remaining
years of his life, lessening the burden of worrying about his financial support or
upkeep. On the other hand, a pension partakes of the nature of "retained wages" of
the retiree for a dual purpose: to entice competent people to enter the government
service, and to permit them to retire from the service with relative security, not only for
those who have retained their vigor, but more so for those who have been
incapacitated by illness or accident.69 (Emphasis supplied)
In Conte v. Commission on Audit,70 this court discussed the purpose behind the
proscription found in Section 28, paragraph (b), as amended. It was to address the
need to prevent the proliferation of inequitous plans:
x x x Sec. 28 (b) as amended by RA 4968 in no uncertain terms bars the creation of
any insurance or retirement plan other than the GSIS for government officers and
employees, in order to prevent the undue and inequitous proliferation of such plans. x
x x. To ignore this and rule otherwise would be tantamount to permitting every other
government office or agency to put up its own supplementary retirement benefit plan
under the guise of such "financial assistance.71
Section 2 of the ordinance, as amended, defined "applicants" as referring to "qualified
employees below sixty (60) years of age but not less than fifty (50) years and sickly
employees below fifty (50) years of age but not less than forty (40) years old from the
effectivity of this Ordinance and shall have rendered service in the City government for
at least 15 years."
This means that even employees other than those who are unproductive due to health
reasons may apply under the ordinance. Albeit last in priority, they may still qualify to
avail of the incentives pursuant to Section 4, paragraph (d), as amended:
Section 4. Prioritization. The following applicants shall be prioritized in availing the
program:
a) First Employees below sixty (60) years of age but not less than fifty (50)
years who are determined by the Chief of General Santos City Hospital to
be qualified to avail of the program;
b) Second Employees below sixty (60) years of age but not less than fifty
(50) years who are under continuous medication as determined by the Chief
of General Santos City Hospital;
c) Third Employees below fifty (50) years of age but not less than forty
(40) years who are determined by the Chief of General Santos City Hospital
to be physically or mentally incapacitated to further continue rendering
service with the City Government and recommended to avail of the
program; and
d) Fourth Employees below sixty (60) years of age but not less than fifty
(50) years who are desirous to avail of the program.
Moreover, Section 3 of the ordinance, as amended, enumerates those who are
covered by the program and may thus apply under the ordinance:
Section 3. Coverage. GenSan SERVES program covers the following employees of
the City Government:
(a) personnel occupying permanent positions;
(b) those who are below sixty (60) years of age but not less than fifty (50)
years on the date of application;
(c) those who are below fifty (50) years of age but not less than forty (40)
years on the date of application but confirmed by the Chief of General
Santos City Hospital to be sickly and recommended to avail early
retirement; and
(d) those who must have served the City Government of General Santos a
minimum of fifteen (15) continuous years.
Under paragraph (d), employees should have served for a minimum of 15 years to
qualify. This requirement is consistent with the definition of a retirement plan as a form
of reward for an employees loyalty and service to the employer. Moreover, pension
plans as defined permit employees to retire with relative security, especially for those
who have been incapacitated by illness.72
Section 5 states that "an eligible employee shall receive an early retirement incentive
provided under this program at the rate of 1 1/2 months of the employees latest basic
salary for every year of service in the City Government." This may be more than the
amount of annuity provided in Section 11, paragraph (a) of Commonwealth Act No.
186 as amended,73 considering that an applicant must have rendered at least 15 years
of service in the city government to qualify.74
Section 5 refers to an "early retirement incentive," the amount of which is pegged on
the beneficiarys years of service in the city government. The ordinance provides that
only those who have rendered service to the city government for at least 15 years may
apply.75 Consequently, this provision falls under the definition of a retirement benefit.
Applying the definition in Conte, it is a form of reward for an employees loyalty and
service to the city government, and it is intended to help the employee enjoy the
remaining years of his or her life by lessening his or her financial worries.
V
In any case, those who availed of the GenSan SERVES were separated from the
service. Those who are separated from the service, whether compulsorily for lawful
cause,76 or voluntarily when incentivized to retire early for streamlining
purposes,77 should consequently be entitled to a form of separation or severance pay.
Petitioner city invoked Republic Act No. 6656, which provides that employees
separated from the service as a result of any reorganization shall be entitled to
separation pay, retirement, and other benefits:
Section 9. All officers and employees who are found by the Civil Service Commission
to have been separated in violation of the provisions of this Act, shall be ordered
reinstated or reappointed as the case may be without loss of seniority and shall be
entitled to full pay for the period of separation. Unless also separated for cause, all
officers and employees, who have been separated pursuant to reorganization shall, if
entitled thereto, be paid the appropriate separation pay and retirement and other
benefits under existing laws within ninety (90) days from the date of the effectivity of
their separation or from the date of the receipt of the resolution of their appeals as the
case may be: Provided, That application for clearance has been filed and no action
thereon has been made by the corresponding department or agency. Those who are
not entitled to said benefits shall be paid a separation gratuity in the amount
equivalent to one (1) month salary for every year of service. Such separation pay and
retirement benefits shall have priority of payment out of the savings of the department
or agency concerned. (Emphasis supplied)
Separation or severance pay has been defined as "an allowance usually based on
length of service that is payable to an employee on severance x x x, or as
compensation due an employee upon the severance of his employment status with
the employer."78
Section 6 of the ordinance on post-retirement incentives provides for benefits that are
not computed based on years of service. They are lump sum amounts and healthcare
benefits:
Section 6. GenSan SERVES Post-Retirement Incentives Upon availment of early
retirement, a qualified employee shall enjoy the following in addition to the above
incentives:
(e) Cash gift of Fifty Thousand Pesos (P50,000.00) for the sickly
employees;
(f) Lifetime free medical consultation at General Santos City Hospital;
(g) Annual aid in the maximum amount of Five Thousand Pesos
(P5,000.00), if admitted at General Santos City Hospital; and
(h) 14 karat gold ring as token.
The text of the ordinance indicates its purpose of encouraging employees, especially
those who are unproductive due to health reasons, to avail of the program even before
they reach the compulsory retirement age. Section 6 provides for a form of severance
pay to those who availed of GenSan SERVES, which was executed in good faith.
We should not be misled by the use of the term "retirement" in Section 6 in
determining the nature of the benefits it provides. Labels are not determinative of
substantive content. It is the purpose behind these incentives, as read from the text of
the ordinance and as inferred from the effect of the ordinance as applied, which must
govern.
The purpose of Section 6 is also different from the benefits proscribed in Conte v.
Commission on Audit,79 and the nature of its benefits must be taken in the context of
its rationale. The benefits provided in Section 6 serve its purpose of inducing petitioner
citys employees, who are unproductive due to health reasons, to retire early.
Respondent Commission on Audits observation that the benefit provided is broader
than that provided in Conte v Commission on Audit fails to take this rationale into
consideration. Furthermore, the benefits under GenSan SERVES were only given to a
select fewthe sickly and unproductive due to health reasons. Certainly, this negates
the position that the benefits provide for supplementary retirement benefits that
augment existing retirement laws.
In Conte v. Commission on Audit80 cited by respondent Commission on Audit, this
court held that the "financial assistance" option for the difference of benefits under
Republic Act No. 660 and Republic Act No. 1616 violated Section 28, paragraph (b) as
amended. Social Security System (SSS) Resolution No. 56 subject of that case
provides in part:
NOW, THEREFORE, BE IT RESOLVED, That all the SSS employees who are
simultaneously qualified for compulsory retirement at age 65 or for optional retirement
at a lower age be encouraged to avail for themselves the life annuity under R.A. 660,
as amended; x x x.81
The fifth preambular clause of Resolution No. 56 also states that "it is the policy of the
Social Security Commission to promote and to protect the interest of all SSS
employees, with a view to providing for their well-being during both their working and
retirement years."82 The financial assistance provides benefits to all Social Security
System employees who are retirable under existing laws and who are qualified to
apply. It is available to all present and future Social Security System employees upon
reaching retirement age.83
Without doubt, this financial assistance of Conte augments the retirement benefits
provided under existing laws, in violation of Section 28, paragraph (b), as amended.
On the other hand, Section 3 of Ordinance No. 08, series of 2009 limits its
coverage.1a\^/phi1 Only qualified employees below sixty (60) years of age but not
less than fifty (50) years and sickly employees below fifty (50) years of age but not
less than forty (40) years from the effectivity of the ordinance, with at least 15 years of
service, are considered. Out of 1,361 regular employees of petitioner city, only 50
employees applied, from which only 39 employees qualified to avail of the ordinance
benefits.84 Petitioner city alleged that there was one more applicant who was
supposed to qualify, but she had died of acute renal failure secondary to diabetes
nephropathy before her application was acted upon.85
Furthermore, unlike in Conte, Ordinance No. 08, series of 2009, was a one-time
limited offer.86 The availment period was only within two months from the ordinances
effectivity.87
In any case, petitioner city is authorized by the Local Government Code to approve
ordinances to provide for the care of the sick:
SECTION 458. Powers, Duties, Functions and Compensation. (a) The
Sangguniang Panlungsod, as the legislative body of the city, shall enact ordinances,
approve resolutions and appropriate funds for the general welfare of the city and its
inhabitants pursuant to section 16 of this Code and in the proper exercise of the
corporate powers of the city as provided for under section 22 of this Code, and shall:
xxxx
(5) Approve ordinances which shall ensure the efficient and effective delivery of the
basic services and facilities as provided for under Section 17 of this Code, and in
addition to said services and facilities, shall:
xxxx
(xiv) Provide for the care of disabled persons, paupers, the aged, the sick, persons of
unsound mind, abandoned minors, juvenile delinquents, drug dependents, abused
children and other needy and disadvantaged persons, particularly children and youth
below eighteen (18) years of age; and, subject to availability of funds, establish and
provide for the operation of centers and facilities for said needy and disadvantaged
persons[.] (Emphasis supplied)
This is also consistent with the constitutional mandate for a comprehensive approach
to health development, with priority for the needs of the sick:
ARTICLE XIII
Social Justice and Human Rights
HEALTH
Section 11. The State shall adopt an integrated and comprehensive approach to
health development which shall endeavor to make essential goods, health and other
social services available to all the people at affordable cost. There shall be priority for
the needs of the underprivileged, sick, elderly, disabled, women, and children. The
State shall endeavor to provide free medical care to paupers.
Thus, the cash gift for the sickly employees, lifetime free medical consultation in
petitioner city's hospital, and other similar benefits under Section 6 of the ordinance
are valid.
The proscription under Section 28, paragraph (b) of Commonwealth Act No. 186, as
amended, does not apply to Section 6 of the ordinance.1wphi1 Consequently, the
Commission on Audit acted with grave abuse of discretion when it declared the entire
ordinance void and of no effect.
WHEREFORE, the petition is PARTIALLY GRANTED. The assailed Commission on
Audit decision dated January 20, 2011 and resolution dated October 17, 2011 are
AFFIRMED with MODIFICATION insofar as Section 6 of Ordinance No. 08, series of
2009, as amended by Ordinance No. 11, series of 2009, is declared as VALID.
SO ORDERED.
G.R. No. L-13678 November 12, 1918
THE UNITED STATES, plaintiff-appellee,
vs.
PRUDENCIO SALAVERIA, defendant-appellant.
Jose R. Varela for appellant.
Office of the Solicitor-General Paredes for appellee.
MALCOLM, J.:
The municipal council of Orion, Bataan, enacted, on February 28, 1917, an ordinance
which, among other things, prohibited the playing of panguingue on days not Sundays
or legal holidays, and penalized the violation thereof by acasero [housekeeper] by a
fine of not less than P10 nor more than P200, and by jugadores [gamblers] by a fine of
not less than P5 nor more than P200. The justice of the peace of Orion, when this
ordinance went into effect, was Prudencio Salaveria, now the defendant and
appellant. Notwithstanding his official station, on the evening of March 8, 1917, not a
Sunday or legal holiday, seven persons including the justice of the peace an his wife
were surprised by the police while indulging in a game of panguingue in the house of
the justice of the peace. The chief of police took possession of the cards, the counters
(sigayes), a tray, an P2.07 in money, used in the game.
These are facts fully proven by the evince and by the admissions of the accused.
Convicted in the justice of the peace court of Orion, and again in the Court of First
Instance of Bataan, Salaveria appeals to this court, making five assignments of error.
The three assignments, of a technical nature, are without merit, and a fourth, relating
to the evidence, is not sustained by the proof. The remaining assignment of error,
questioning the validity of the ordinance under which the accused was convicted,
requires serious consideration and final resolution. This ordinance in part reads:
RESOLUTION NO. 28
xxx xxx xxx
Whereas, this Council is vested with certain powers by sections 2184 and
2185 of the Administrative Code;
Whereas, it is the moral duty of this body to safeguard the tranquillity and
stability of the Government and to foster the welfare and prosperity of each
an all of the inhabitants of this municipality; therefore,
Be it resolved to enact, as it hereby is enacted, the following ordinance:
Ordinance No. 3
xxx xxx xxx
Third. The games known as "Panguingue" "Manilla," "Jung-kiang,"
"Paris-Paris," "Poker," "Tute," "Burro," and "Treinta-y-uno" shall be allowed
only on Sundays an official holidays.
xxx xxx xxx
The following penalties shall be imposed upon those who play the above
games on days other than Sundays and official holidays:
 For the owner of the house: A fine of from Ten to Two hundred pesos, or
subsidiary imprisonment in case of insolvency at the rate of one peso a day.
For the gamblers: A fine of from Five to Two hundred pesos each or
subsidiary imprisonment in case of insolvency at the rate of one peso a day.
The Philippine Legislature has granted to municipalities legislative powers of a dual
character, one class mandatory an the other discretionary. Of the first class is the
provision of the Administrative Code which makes it the duty of the municipal council,
conformably with law, "to prohibit and penalize . . . gambling." (Sec. 2188 [i], Adm.
Code of 1916; sec. 2242 [i], Adm. Code of 1917.) This is a more restricted power than
that found in the original Municipal Code which authorized a municipal council to
"provide against the evils of gambling, gambling houses, and disorderly houses of
whatsoever sort." (Act No. 82, sec. 39 [u].) The present municipal law, since making
use of the word "gambling," must be construed with reference to the Insular Law, Act
No. 1757, relating to the same subject. Act No. 1757 in section 1 defines "gambling"
as "the paying of any game for money or any representative of value or valuable
consideration or thing, the result of which game depends wholly or chiefly upon
chance or hazard, or the use of any mechanical inventions or contrivance to determine
by chance the loser or winner of money or of any representative of value or of any
valuable consideration or thing." In the United States vs. Hilario ([1913], 24 Phil., 392),
the Supreme Court went into the subject of the meaning of "gambling" in this
jurisdiction, and found that it includes those games the result of which depend wholly
or chiefly upon chance or hazard, and excludes those games the result of which
depend wholly or chiefly upon skill, with the result that sections 621 to 625 of the
Revise Ordinances of the city of Manila (734-738 of the Revised Ordinances of 1917)
were found to prohibit only games of chance or hazard.
The ordinance of Orion, Bataan, merely prohibits the playing of panguingue on certain
days, without describing it. Further, although this court has considered the method by
which many other games are played, it has never as yet authoritatively decided
whether panguingue was a game of skill or hazard. Nor was any evidence on this
point introduced in the present case. However, a reading of the decision of the trial
court and of official opinions of two Attorneys-General, of which we can take judicial
cognizance, warrants the deduction that panguingue is not a game of chance or
hazard and is not prohibited by Act No. 1757. (See Opinions of the Attorney-General
of July 11, 1904; July 25, 1904; October 10, 1905; and September 7, 1911; also
Berriz, Diccionario de la Administracion, p. 35.) If, therefore, we were to restrict our
investigation to those portions of the Administrative Code which authorize a municipal
council to prohibit and penalize gambling, there would exist grave doubt, to say the
least, of the validity of ordinance No. 3 of the municipality of Orion, Bataan.
There remains for consideration a different approach to the question.
While Philippine law gives to gambling a restricted meaning, it is to be noted that, in its
broader signification, gambling relates to play by certain rules at cards, dice, or other
contrivance, so that one shall be the loser an the other the winner. (20 Cyc., 878;
Bouvier's Law Dictionary; People vs. Todd [1889], 51 Hun [N. Y.], 446 451; 4 N. Y.
Supp., 25.) As one example the Charter of the town of Ruston, State of Louisiana,
authorized it "to restrain, prohibit, an suppress . . . games and gambling houses and
rooms . . ., and to provide for the punishment of the persons engaged in the same."
Under this power the town passed an ordinance prohibiting "all games of chance,
lottery, banking games, raffling, and all other species of gambling," indicating that
there were other species of gambling in addition to games of chance. (See Town of
Ruston vs. Perkins [1905], 114 La., 851.) The common law notion of gambling, which
only made it an indictable offense when the play was attended by such circumstances
as would in themselves amount to a riot or a nuisance or to an actual breach of the
peace, has given way to statutes and ordinances designed to restrain, suppress, or
control gambling.
Authority for the State or a municipality to take action to control gambling in this larger
sense can be found in an analysis of what is calle the police power.
Any attempt to define the police power with circumstantial precision would savor of
pedantry. The United States Supreme Court tritely describes it as "the most essential
of all powers, at times the most insistent, an always one of least limitable of the
powers of government." (District of Columbia vs. Brooks [1909], 214 U.S., 138.) The
police power is based on the maxim "salus populi est suprema lex" the welfare of
the people is the first law. The United States Supreme Court has said that it extends
"to the protection of the lives, health and property of the citizens, and to
the preservation of good order and the public morals." (Beer Co. vs. Massachusetts
[1878] , 97 U.S., 25; Barbiervs. Connolly [1885], 113 U.S., 27.) The Supreme Court of
these Islands has said that it extends "the police power of the state includes not only
the public health safety, but also the public welfare, protection against impositions,
andgenerally the public's best interest." (U.S. vs. Pompeya [1915], 31 Phil., 245.)
Recent judicial decisions incline to give a more extensive scope to the police power
that the older cases. The public welfare is rightfully made the basis of construction.
Not only does the State effectuate its purposes through the exercise of the police
power but the municipality does also. Like the State, the police power of a municipal
corporation extends to all matters affecting the peace, order, health, morals,
convenience, comfort, and safety of its citizens the security of social order the
best and highest interests of the municipality. (Case vs. Board of Health of Manila and
Heiser [1913], 24 Phil., 250.) The best considered decisions have tended to broaden
the scope of action of the municipality in dealing with police offenses. Within the
general police powers of a municipal corporation is the suppression of gambling.
Ordinances aimed in a reasonable way at the accomplishment of this purpose are
undoubtedly valid. (See U.S. vs. Pacis [1915], 31 Phil., 524; 39 L. R. A., 523, Note;
Cooley's Constitutional Limitations, 6th edition, pp. 138, 226, 742;
Greenville vs.Kemmis [1900], 58 S. C., 427 [holding that under the general welfare
clause a city may pass an ordinance prohibiting gambling in any private house].)
The Philippine Legislature, as before intimated, delegated to municipalities certain
legislative powers are named specifically. But in addition, and preceding both the
specific powers of a mandatory and discretionary character, is the general power of a
municipal council to enact ordinances and make regulations. It is this grant that the
preamble of the ordinance of Orion assigns as authority for its enactment. Said section
2184 of the Administrative Code of 1916 (sec. 2238, Adm. Code of 1917) reads:
The municipal council shall enact such ordinances and make such
regulations, not repugnant to law, as may be necessary to carry into effect
and discharge the powers an duties conferred upon it by law an such as
shall seem necessary and proper to provide for the health and
safety, promote the prosperity, improve the morals, peace, good order,
 comfort, and convenience of the municipality and the inhabitants
thereof, and for the protection of property therein.
This section, known as the general welfare clause, delegates in statutory form the
police power to a municipality. As above stated, this clause has been given wide
application by municipal authorities and has in its relation to the particular
circumstances of the case been liberally construed by the courts. Such, it is well to
recall, is the progressive view of Philippine jurisprudence.
The general welfare clause has two branches. One branch attaches itself to the main
trunk of municipal authority, and relates to such ordinances and regulations as may be
necessary to carry into effect and discharge the powers and duties conferred upon the
municipal council by law. With this class we are not here directly concerned. The
second branch of the clause is much more independent of the specific functions of the
council which are enumerated by law. It authorizes such ordinances "as shall seem
necessary and proper to provide for the health and safety, promote the prosperity,
improve the morals, peace, good order, comfort, and convenience of the municipality
and the inhabitants thereof, and for the protection of property therein."
It is a general rule that ordinances passed by virtue of the implied power found in the
general powers and purposes of the corporation, and not inconsistent with the laws or
policy of the State. The ordinance of the municipality of Orion does not seem in itself
to be pernicious, or unreasonable or discriminatory. Its purposes evidently are to
improve the morals and stimulate the industry of the people. A person is to be
compelled to refrain from private acts injurious both to himself and his neighbors.
These objects, to be attained by limiting the pastime to definite days, do not infringe
any law of the general government.
The constitutional provision that no person shall be deprived of liberty without due
process of law is not violated by this ordinance. Liberty of action by the individual is
not unduly circumscribed; that is, it is not unduly circumscribed if we have in mind the
correct notion of this "the greatest of all rights." That gravest of sociological questions
How far, consistently with freedom, may the liberties of the individual member of
society be subordinated to the will of the Government? has been debated for
centuries, in vain, if we can not now discount the time worn objection to any and all
interference with private rights in order to effectuate the public purpose. (See
Jacobson vs. Massachusetts [1905], 197 U. S., 11; State vs. Kreutzberg [1902], 58 L.
R. A., 748.) Almost countless are the governmental restrictions on the citizen.
The presumption is all favor of validity. The inhabitants of a municipality are in
themselves miniature states. The action of the elected representatives of the people
cannot be lightly set aside. The councilors must, in the very nature of things, be
familiar with the necessities of their particular municipality an with all the facts and
circumstances which surround the subject, and necessities of their particular
municipality and with all the facts and circumstances which surround the subject, and
necessitate action. The local legislative body, by enacting the ordinance, has in effect
given notice that the regulations are essential to the well being of the people. Who is
in a better position to say whether the playing of panguingue is deleterious to social
order and the public interest in a certain municipality the municipal council, or the
courts? The answer is self-evident. The Judiciary should not lightly set aside
legislative action when there is not a clear invasion of personal or property rights
under the guise of police regulation. (See U.S. vs. Joson [1913], 26 Phil., 1.)
President McKinley's Instructions to the Commission still remain undisturbed by
subsequent Acts of Congress dealing with Philippine affairs and yet constitute a
portion of our constitutional law, as to the inviolable rule that "municipal governments .
. . shall be afforded the opportunity to manage their own affairs to the fullest extent of
which they are capable." Again the same organic law says, "In the distribution of
powers among the governments organized by the Commission, the presumption is
always to be in favor of the smaller subdivision, so that all the powers which can
properly be exercised by the municipal government shall be vested in that government
. . . ." Let us never forget these principles so highly protective of local self-government.
The judiciary can very well take notice of the fact that municipalities are accustomed to
enacting ordinances aimed at the regulation of gambling. The executive authorities an
the Attorney-General have usually upheld the validity of such ordinances, especially
those intended to restrict the playing of panguingue. (Opinions of the Attorney-
General,supra; Opinion of the Executive Secretary, July 6, 1909; Indorsement of the
Governor-General, July 21, 1904.) This general municipal practice, indicative of a
social cancer to be eradicated, should not be discouraged by strict judicial
construction.
More important still, the courts cannot but realize that gambling, in its larger sense as
well as in its restricted sense, is an act beyond the pale of good morals, which, for the
welfare of the Filipino people, should be exterminated. The suppression of the evil
does not interfere with any of the inherent rights of citizenship. The pernicious practice
is rightfully regarded as the offspring of idleness and the prolific parent of vice and
immorality, demoralizing in its association and tendencies, detrimental to the best
interests of society, and encouraging wastefulness, thriftlessness, and a belief that a
livelihood may be earned by other means than honest industry. To be condemned in
itself, it has the further effect of causing poverty, dishonesty, fraud, and deceit. Many a
man has neglected his business and mortgaged his integrity to follow the fickle
Goddess of the cards. Many a woman has wasted her hours and squandered her
substance at the gambling board while home and children were forgotten. It is highly
proper that this pastime should be subject to the control of restraints imposed by the
ordinances of local governments peculiarly afflicted by the evil. (See In re Voss [1903],
11 N. D., 540; Ex parte Tuttle [1891], 91, Cal., 589; Greenwood vs. State [1873], 6
Baxt., 567; 32 Am. Rep., 539; 12 R. C. L., 709-715.)
For the suppression of such an evil, coordinate and harmonious action must concur
between the three departments of Government. A law or ordinance enacted by the
legislative body must exist. Such an ordinance is before us. Vigorous executive
enforcement must take place to make the law or ordinance a reality. Such activity by
the police has brought this case to the courts. And finally the Judiciary, having full
respect for the legislative action of the municipal council and for the prosecution by the
executive officials, must, by judicial construction, equally as progressive and
constructive, give effect to the action of the other two powers. Wherefore,
although panguingue is not entirely a game of chance, since it is a proper subject for
regulation by municipal authorities acting under their delegated police power, whose
laudable intention is to improve the public morals and promote the prosperity of their
people, their action should be upheld by the courts. Ordinance No. 3 of Orion, Bataan,
is found to be valid.
The culprit in this case is himself a member of the Judiciary. Instead of enforcing the
law, he has scorned it. His example to the people of Orion has been pernicious in its
influence. If gambling is to be suppressed, not only the weak and ignorant must be
punished, but those with full knowledge of the law and the consequences of violation.
We would accordingly suggest to Courts of First Instance that in all cases arising
under the Gambling Law or ordinances, except for unusual circumstances, a prison
sentence should be imposed, if permitted by the law or ordinance. We further suggest
that, where the defendant has been found guilty and is a man of station, he be given
the maximum penalty.lawphil.net
Applying the foregoing in this instance, it results that the defendant and appellant must
be found guilty of a violation of ordinance No. 3 of the municipality of Orion, Bataan;
and, in accordance therewith, shall be sentenced to the maximum penalty of the
payment of a fine of P200, or to subsidiary imprisonment in case of insolvency, with
the costs of all three instances against him. So ordered.
Arellano, C.J., Torres, Araullo and Avancea, JJ., concur.
EN BANC
G.R. No. 92389 September 11, 1991
HON. JEJOMAR C. BINAY and the MUNICIPALITY OF MAKATI, petitioners,
vs.
HON. EUFEMIO DOMINGO and the COMMISSION ON AUDIT, respondents.
Jejomar C. Binay for himself and for his co-petitioner.
Manuel D. Tamase and Rafael C. Marquez for respondents.
PARAS, J.:p
The only pivotal issue before Us is whether or not Resolution No. 60, re-enacted
under Resolution No. 243, of the Municipality of Makati is a valid exercise of police
power under the general welfare clause.
The pertinent facts are:
On September 27, 1988, petitioner Municipality, through its Council, approved
Resolution No. 60 which reads:
A RESOLUTION TO CONFIRM AND/OR RATIFY THE
ONGOING BURIAL ASSISTANCE PROGRAM INITIATED BY
THE OFFICE OF THE MAYOR, OF EXTENDING FINANCIAL
ASSISTANCE OF FIVE HUNDRED PESOS (P500.00) TO A
BEREAVED FAMILY, FUNDS TO BE TAKEN OUT OF
UNAPPROPRIATED AVAILABLE FUNDS EXISTING IN THE
MUNICIPAL TREASURY. (Rollo, Annnex "A" p. 39)
Qualified beneficiaries, under the Burial Assistance Program, are bereaved families of
Makati whose gross family income does not exceed two thousand pesos (P2,000.00)
a month. The beneficiaries, upon fulfillment of other requirements, would receive the
amount of five hundred pesos (P500.00) cash relief from the Municipality of Makati.
(Reno, Annex "13", p. 41)
Metro Manila Commission approved Resolution No. 60. Thereafter, the municipal
secretary certified a disbursement fired of four hundred thousand pesos (P400,000.00)
for the implementation of the Burial Assistance Program. (Rollo, Annex "C", p. 43).
Resolution No. 60 was referred to respondent Commission on Audit (COA) for its
expected allowance in audit. Based on its preliminary findings, respondent COA
disapproved Resolution No. 60 and disallowed in audit the disbursement of finds for
the implementation thereof. (Rollo, Annex "D", P. 44)
Two letters for reconsideration (Annexes "E" and "F", Rollo, pp. 45 and 48,
respectively) filed by petitioners Mayor Jejomar Binay, were denied by respondent in
its Decision No. 1159, in the following manner:
Your request for reconsideration is predicated on the following
grounds, to wit:
1. Subject Resolution No. 60, s. 1988, of the Municipal Council of
Makati and the intended disbursements fall within the twin
principles of 'police power and parens patriae and
2. The Metropolitan Manila Commission (MMC), under a
Certification, dated June 5, 1989, has already appropriated the
amount of P400,000.00 to implement the Id resolution, and the
only function of COA on the matter is to allow the financial
assistance in question.
The first contention is believed untenable. Suffice it to state that:
a statute or ordinance must have a real
substantial, or rational relation to the public
safety, health, morals, or general welfare to
be sustained as a legitimate exercise of the
police power. The mere assertion by the
legislature that a statute relates to the public
health, safety, or welfare does not in itself
bring the statute within the police power of a
state for there must always be an obvious
and real connection between the actual
provisions of a police regulations and its
avowed purpose, and the regulation adopted
must be reasonably adapted to accomplish
the end sought to be attained. 16 Am. Jur 2d,
pp. 542-543; emphasis supplied).
 Here, we see no perceptible connection or relation between the
objective sought to be attained under Resolution No. 60, s.
1988, supra, and the alleged public safety, general welfare, etc. of
the inhabitants of Makati.
Anent the second contention, let it be stressed that Resolution
No. 60 is still subject to the limitation that the expenditure covered
thereby should be for a public purpose, i.e., that the disbursement
of the amount of P500.00 as burial assistance to a bereaved
family of the Municipality of Makati, or a total of P400,000.00
appropriated under the Resolution, should be for the benefit of the
whole, if not the majority, of the inhabitants of the Municipality and
not for the benefit of only a few individuals as in the present case.
On this point government funds or property shall be spent or used
solely for public purposes. (Cf. Section 4[2], P.D. 1445). (pp. 50-
51, Rollo)
Bent on pursuing the Burial Assistance Program the Municipality of Makati, through its
Council, passed Resolution No. 243, re-affirming Resolution No. 60 (Rollo, Annex "H",
p. 52).
However, the Burial Assistance Program has been stayed by COA Decision No. 1159.
Petitioner, through its Mayor, was constrained to file this special civil action of
certiorari praying that COA Decision No. 1159 be set aside as null and void.
The police power is a governmental function, an inherent attribute of sovereignty,
which was born with civilized government. It is founded largely on the maxims, "Sic
utere tuo et ahenum non laedas and "Salus populi est suprema lex Its fundamental
purpose is securing the general welfare, comfort and convenience of the people.
Police power is inherent in the state but not in municipal corporations (Balacuit v. CFI
of Agusan del Norte, 163 SCRA 182). Before a municipal corporation may exercise
such power, there must be a valid delegation of such power by the legislature which is
the repository of the inherent powers of the State. A valid delegation of police power
may arise from express delegation, or be inferred from the mere fact of the creation of
the municipal corporation; and as a general rule, municipal corporations may exercise
police powers within the fair intent and purpose of their creation which are reasonably
proper to give effect to the powers expressly granted, and statutes conferring powers
on public corporations have been construed as empowering them to do the things
essential to the enjoyment of life and desirable for the safety of the people. (62 C.J.S.,
p. 277). The so-called inferred police powers of such corporations are as much
delegated powers as are those conferred in express terms, the inference of their
delegation growing out of the fact of the creation of the municipal corporation and the
additional fact that the corporation can only fully accomplish the objects of its creation
by exercising such powers. (Crawfordsville vs. Braden, 28 N.E. 849). Furthermore,
municipal corporations, as governmental agencies, must have such measures of the
power as are necessary to enable them to perform their governmental functions. The
power is a continuing one, founded on public necessity. (62 C.J.S. p. 273) Thus, not
only does the State effectuate its purposes through the exercise of the police power
but the municipality does also. (U.S. v. Salaveria, 39 Phil. 102).
Municipal governments exercise this power under the general welfare clause:
pursuant thereto they are clothed with authority to "enact such ordinances and issue
such regulations as may be necessary to carry out and discharge the responsibilities
conferred upon it by law, and such as shall be necessary and proper to provide for the
health, safety, comfort and convenience, maintain peace and order, improve public
morals, promote the prosperity and general welfare of the municipality and the
inhabitants thereof, and insure the protection of property therein." (Sections 91, 149,
177 and 208, BP 337). And under Section 7 of BP 337, "every local government unit
shall exercise the powers expressly granted, those necessarily implied therefrom, as
well as powers necessary and proper for governance such as to promote health and
safety, enhance prosperity, improve morals, and maintain peace and order in the local
government unit, and preserve the comfort and convenience of the inhabitants
therein."
Police power is the power to prescribe regulations to promote the health, morals,
peace, education, good order or safety and general welfare of the people. It is the
most essential, insistent, and illimitable of powers. In a sense it is the greatest and
most powerful attribute of the government. It is elastic and must be responsive to
various social conditions. (Sangalang, et al. vs. IAC, 176 SCRA 719). On it depends
the security of social order, the life and health of the citizen, the comfort of an
existence in a thickly populated community, the enjoyment of private and social life,
and the beneficial use of property, and it has been said to be the very foundation on
which our social system rests. (16 C.J.S., P. 896) However, it is not confined within
narrow circumstances of precedents resting on past conditions; it must follow the legal
progress of a democratic way of life. (Sangalang, et al. vs. IAC, supra).
In the case at bar, COA is of the position that there is "no perceptible connection or
relation between the objective sought to be attained under Resolution No. 60, s. 1988,
supra, and the alleged public safety, general welfare. etc. of the inhabitants of Makati."
(Rollo, Annex "G", p. 51).
Apparently, COA tries to re-define the scope of police power by circumscribing its
exercise to "public safety, general welfare, etc. of the inhabitants of Makati."
In the case of Sangalang vs. IAC, supra, We ruled that police power is not capable of
an exact definition but has been, purposely, veiled in general terms to underscore its
all comprehensiveness. Its scope, over-expanding to meet the exigencies of the times,
even to anticipate the future where it could be done, provides enough room for an
efficient and flexible response to conditions and circumstances thus assuring the
greatest benefits.
The police power of a municipal corporation is broad, and has been said to be
commensurate with, but not to exceed, the duty to provide for the real needs of the
people in their health, safety, comfort, and convenience as consistently as may be
with private rights. It extends to all the great public needs, and, in a broad sense
includes all legislation and almost every function of the municipal government. It
covers a wide scope of subjects, and, while it is especially occupied with whatever
affects the peace, security, health, morals, and general welfare of the community, it is
not limited thereto, but is broadened to deal with conditions which exists so as to bring
out of them the greatest welfare of the people by promoting public convenience or
general prosperity, and to everything worthwhile for the preservation of comfort of the
inhabitants of the corporation (62 C.J.S. Sec. 128). Thus, it is deemed inadvisable to
attempt to frame any definition which shall absolutely indicate the limits of police
power.
COA's additional objection is based on its contention that "Resolution No. 60 is still
subject to the limitation that the expenditure covered thereby should be for a public
purpose, ... should be for the benefit of the whole, if not the majority, of the inhabitants
of the Municipality and not for the benefit of only a few individuals as in the present
case." (Rollo, Annex "G", p. 51).
COA is not attuned to the changing of the times. Public purpose is not unconstitutional
merely because it incidentally benefits a limited number of persons. As correctly
pointed out by the Office of the Solicitor General, "the drift is towards social welfare
legislation geared towards state policies to provide adequate social services (Section
9, Art. II, Constitution), the promotion of the general welfare (Section 5, Ibid) social
justice (Section 10, Ibid) as well as human dignity and respect for human rights.
(Section 11, Ibid." (Comment, p. 12)
The care for the poor is generally recognized as a public duty. The support for the
poor has long been an accepted exercise of police power in the promotion of the
common good.
There is no violation of the equal protection clause in classifying paupers as subject of
legislation. Paupers may be reasonably classified. Different groups may receive
varying treatment. Precious to the hearts of our legislators, down to our local
councilors, is the welfare of the paupers. Thus, statutes have been passed giving
rights and benefits to the disabled, emancipating the tenant-farmer from the bondage
of the soil, housing the urban poor, etc.
Resolution No. 60, re-enacted under Resolution No. 243, of the Municipality of Makati
is a paragon of the continuing program of our government towards social justice. The
Burial Assistance Program is a relief of pauperism, though not complete. The loss of a
member of a family is a painful experience, and it is more painful for the poor to be
financially burdened by such death. Resolution No. 60 vivifies the very words of the
late President Ramon Magsaysay 'those who have less in life, should have more in
law." This decision, however must not be taken as a precedent, or as an official go-
signal for municipal governments to embark on a philanthropic orgy of inordinate dole-
outs for motives political or otherwise.
PREMISES CONSIDERED, and with the afore-mentioned caveat, this petition is
hereby GRANTED and the Commission on Audit's Decision No. 1159 is hereby SET
ASIDE.
SO ORDERED.
SECOND DIVISION
G.R. No. 40243 March 11, 1992
CELESTINO TATEL, petitioner,
vs.
MUNICIPALITY OF VIRAC, SALVADOR A. SURTIDA, in his capacity as Mayor of
Virac, Catanduanes; GAVINO V. GUERRERO, in his capacity as Vice-Mayor of
Virac, Catanduanes; JOSE T. BUEBOS, in his capacity as Councilor of Virac,
Catanduanes; ANGELES TABLIZO, in his capacity as Councilor of Virac,
Catanduanes; ELPIDIO T. ZAFE, in his capacity as Councilor of Virac,
Catanduanes; MARIANO ALBERTO, in his capacity as Councilor of Virac,
Catanduanes; JULIA A. GARCIA, in her capacity as Councilor of Virac,
Catanduanes; and PEDRO A. GUERRERO, in his capacity as Councilor of Virac,
Catanduanes, respondents.
NOCON, J.:
This is a Petition for Prohibition with Preliminary Injunction with the Court of First
Instance of Catanduanes filed by appellant, Celestino Tatel, a businessman engaged
in the import and export of abaca and other products against the Municipal Council of
Virac, Catanduanes and its municipal officials enjoining them from enforcing
Resolution No 291 of the Council, declaring the warehouse of petitioner in barrio Sta.
Elena of the said municipality a public nuisance within the purview of Article 694 of the
Civil Code of the Philippines and directing the petitioner to remove and transfer said
warehouse to a more suitable place within two (2) months from receipt of the said
resolution.
It appears from the records that on the basis of complaints received from the residents
of barrio Sta. Elena on March 18, 1966 against the disturbance caused by the
operation of the abaca bailing machine inside the warehouse of petitioner which
affected the peace and tranquility of the neighborhood due to the smoke, obnoxious
odor and dust emitted by the machine, a committee was appointed by the municipal
council of Virac to investigate the matter. The committee noted the crowded nature of
the neighborhood with narrow roads and the surrounding residential houses, so much
so that an accidental fire within the warehouse of the petitioner occasioned by the
continuance of the activity inside the warehouse and the storing of inflammable
materials created a danger to the lives and properties of the people within the
neighborhood.
Resultantly, Resolution No. 29 was passed by the Municipal Council of Virac on April
22, 1966 declaring the warehouse owned and operated by petitioner a public nuisance
within the purview of Article 694 of the New Civil Code. 2
His motion for reconsideration having been denied by the Municipal Council of Virac,
petitioner instituted the present petition for prohibition with preliminary injunction.
Respondent municipal officials contend that petitioner's warehouse was constructed in
violation of Ordinance No. 13, series of 1952, prohibiting the construction of
warehouses near a block of houses either in the poblacion or barrios without
maintaining the necessary distance of 200 meters from said block of houses to avoid
loss of lives and properties by accidental fire.
On the other hand, petitioner contends that said ordinance is unconstitutional, contrary
to the due process and equal protection clause of the Constitution and null and void
for not having been passed in accordance with law.
The issue then boils down on whether petitioner's warehouse is a nuisance within the
meaning of Article 694 of the Civil Code and whether Ordinance No. 13, S. 1952 of the
Municipality of Virac is unconstitutional and void.
In a decision dated September 18, 1969, the court a quo ruled as follows:
1. The warehouse in question was legally constructed under a
valid permit issued by the municipality of Virac in accordance with
existing regulations and may not be destroyed or removed from
its present location;
2. Ordinance No. 13, series of 1952, is a legitimate and valid
exercise of police power by the Municipal Council of Virac is not
(sic) unconstitutional and void as claimed by the petitioner;
3. The storage by the petitioner of abaca and copra in the
warehouse is not only in violation of the provisions of the
ordinance but poses a grave danger to the safety of the lives and
properties of the residents of the neighborhood due to accidental
fire and constitutes a public nuisance under the provisions of
Article 694 of the New Civil code of the Philippines and may be
abated;
4. Accordingly, the petitioner is hereby directed to remove from
the said warehouse all abaca and copra and other inflammable
articles stored therein which are prohibited under the provisions of
Ordinance No. 13, within a period of two (2) months from the time
this decision becomes final and that henceforth, the petitioner is
enjoined from storing such prohibited articles in the warehouse.
With costs against petitioner.
Seeking appellate review, petitioner raised as errors of the court a quo:
1. In holding that Ordinance No. 13, series of 1952, of the
Municipality of Virac, Catanduanes, is a legitimate and valid
exercise of police power of the Municipal Council, and therefore,
constitutional;
2. In giving the ordinance a meaning other than and different from
what it provided by declaring that petitioner violated the same by
using the warehouse for storage of abaca and copra when what is
prohibited and penalized by the ordinance is the construction of
warehouses.
3. In refusing to take judicial notice of the fact that in the
municipality, there are numerous establishments similarly situated
as appellants' warehouses but which are not prosecuted.
We find no merit in the Petition.
Ordinance No. 13, series of 1952, was passed by the Municipal Council of Virac in the
exercise of its police power. It is a settled principle of law that municipal corporations
are agencies of the State for the promotion and maintenance of local self-government
and as such are endowed with the police powers in order to effectively accomplish
and carry out the declared objects of their creation. 3 Its authority emanates from the
general welfare clause under the Administrative Code, which reads:
The municipal council shall enact such ordinances and make
such regulations, not repugnant to law, as may be necessary to
carry into effect and discharge the powers and duties conferred
upon it by law and such as shall seem necessary and proper to
provide for the health and safety, promote the prosperity, improve
the morals, peace, good order, comfort and convenience of the
municipality and the inhabitants thereof, and for the protection of
property therein. 4
For an ordinance to be valid, it must not only be within the corporate powers of the
municipality to enact but must also be passed according to the procedure prescribed
by law, and must be in consonance with certain well established and basic principles
of a substantive nature. These principles require that a municipal ordinance (1) must
not contravene the Constitution or any statute (2) must not be unfair or oppressive (3)
must not be partial or discriminatory (4) must not prohibit but may regulate trade (5)
must be general and consistent with public policy, and (6) must not be
unreasonable. 5 Ordinance No. 13, Series of 1952, meets these criteria.
As to the petitioner's second assignment of error, the trial court did not give the
ordinance in question a meaning other than what it says. Ordinance No. 13 passed by
the Municipal Council of Virac on December 29, 1952, 6 reads:
AN ORDINANCE STRICTLY PROHIBITING THE
CONSTRUCTION OF WAREHOUSE IN ANY FORM NEAR A
BLOCK OF HOUSES EITHER IN POBLACION OR BARRIO
WITH NECESSARY DISTANCE TO AVOID GREAT LOSSES OF
PROPERTY AND LIVES BY FIRE ACCIDENT.
Section 1 provides:
It is strictly prohibited to construct warehouses in any form to any
person, persons, entity, corporation or merchants, wherein to
keep or store copra, hemp, gasoline, petroleum, alcohol, crude
oil, oil of turpentine and the like products or materials if not within
the distance of 200 meters from a block of houses either in the
poblacion or barrios to avoid great losses of properties inclusive
lives by fire accident.
Section 2 provides: 7
Owners of warehouses in any form, are hereby given advice to
remove their said warehouses this ordinance by the Municipal
Council, provided however, that if those warehouses now in
existence should no longer be utilized as such warehouse for the
above-described products in Section 1 of this ordinance after a
lapse of the time given for the removal of the said warehouses
now in existence, same warehouses shall be exempted from the
spirit of the provision of section 1 of this
ordinance,provided further, that these warehouses now in
existence, shall in the future be converted into non-inflammable
products and materials warehouses.
In spite of its fractured syntax, basically, what is regulated by the ordinance is the
construction of warehouses wherein inflammable materials are stored where such
warehouses are located at a distance of 200 meters from a block of houses and not
the construction per se of a warehouse. The purpose is to avoid the loss of life and
property in case of fire which is one of the primordial obligation of the government.
This was also the observation of the trial court:
A casual glance of the ordinance at once reveals a manifest
disregard of the elemental rules of syntax. Experience, however,
will show that this is not uncommon in law making bodies in small
towns where local authorities and in particular the persons
charged with the drafting and preparation of municipal resolutions
and ordinances lack sufficient education and training and are not
well grounded even on the basic and fundamental elements of the
English language commonly used throughout the country in such
matters. Nevertheless, if one scrutinizes the terms of the
ordinance, it is clear that what is prohibited is the construction of
warehouses by any person, entity or corporation wherein copra,
hemp, gasoline and other inflammable products mentioned in
Section 1 may be stored unless at a distance of not less than 200
meters from a block of houses either in the poblacion or barrios in
order to avoid loss of property and life due to fire. Under Section
2, existing warehouses for the storage of the prohibited articles
were given one year after the approval of the ordinance within
which to remove them but were allowed to remain in operation if
they had ceased to store such prohibited articles.
The ambiguity therefore is more apparent than real and springs
from simple error in grammatical construction but otherwise, the
meaning and intent is clear that what is prohibited is the
construction or maintenance of warehouses for the storage of
inflammable articles at a distance within 200 meters from a block
of houses either in the poblacion or in the barrios. And the
purpose of the ordinance is to avoid loss of life and property in
case of accidental fire which is one of the primordial and basic
obligation of any government. 8
Clearly, the lower court did NOT add meaning other than or differrent from what
was provided in the ordinance in question. It merely stated the purpose of the
ordinance and what it intends to prohibit to accomplish its purpose.
As to the third assignment of error, that warehouses similarly situated as that of the
petitioner were not prosecuted, suffice it to say that the mere fact that the municipal
authorities of Virac have not proceeded against other warehouses in the municipality
allegedly violating Ordinance No. 13 is no reason to claim that the ordinance is
discriminatory. A distinction must be made between the law itself and the manner in
which said law is implemented by the agencies in charge with its administration and
enforcement. There is no valid reason for the petitioner to complain, in the absence of
proof that the other bodegas mentioned by him are operating in violation of the
ordinance and that the complaints have been lodged against the bodegas concerned
without the municipal authorities doing anything about it.
The objections interposed by the petitioner to the validity of the ordinance have not
been substantiated. Its purpose is well within the objectives of sound government. No
undue restraint is placed upon the petitioner or for anybody to engage in trade but
merely a prohibition from storing inflammable products in the warehouse because of
the danger of fire to the lives and properties of the people residing in the vicinity. As
far as public policy is concerned, there can be no better policy than what has been
conceived by the municipal government.
As to petitioner's contention of want of jurisdiction by the lower court we find no merit
in the same. The case is a simple civil suit for abatement of a nuisance, the original
jurisdiction of which falls under the then Court of First Instance.
WHEREFORE, for lack of merit, the petition is hereby DISMISSED. Costs against
petitioner.
SO ORDERED.
EN BANC
[G.R. No. 110249. August 21, 1997]
ALFREDO TANO, BALDOMERO TANO, DANILO TANO, ROMUALDO TANO,
TEOCENES MIDELLO, ANGEL DE MESA, EULOGIO TREMOCHA,
FELIPE ONGONION, JR., ANDRES LINIJAN, ROBERT LIM, VIRGINIA
LIM, FELIMON DE MESA, GENEROSO ARAGON, TEODORICO ANDRE,
ROMULO DEL ROSARIO, CHOLITO ANDRE, ERICK MONTANO,
ANDRES OLIVA, VITTORIO SALVADOR, LEOPOLDO ARAGON,
RAFAEL RIBA, ALEJANDRO LEONILA, JOSE DAMACINTO, RAMIRO
MANAEG, RUBEN MARGATE, ROBERTO REYES, DANILO
PANGARUTAN, NOE GOLPAN,ESTANISLAO ROMERO, NICANOR
DOMINGO, ROLDAN TABANG, PANGANIBAN, ADRIANO TABANG,
FREDDIE SACAMAY, MIGUEL TRIMOCHA, PACENCIO LABABIT,
PABLO H. OMPAD, CELESTINO A. ABANO, ALLAN ALMODAL, BILLY
D. BARTOLAY, ALBINO D. LIQUE, MELCHOR J. LAYSON, MELANI
AMANTE, CLARO E. YATOC, MERGELDO B. BALDEO, EDGAR M.
ALMASET A., JOSELITO MANAEG, LIBERATO ANDRADA, JR.,
ROBERTO BERRY, RONALD VILLANUEVA, EDUARDO VALMORIA,
WILDREDO MENDOZA, NAPOLEON BABANGA, ROBERTO TADEPA,
RUBEN ASINGUA, SILVERIO GABO, JERRY ROMERO, DAVID
PANGAGARUTAN, DANIEL PANGGARUTAN, ROMEO AGAWIN,
FERNANDO EQUIZ, DITO LEQUIZ, RONILO ODERABLE, BENEDICTO
TORRES, ROSITO A. VALDEZ, CRESENCIO A. SAYANG, NICOMEDES
S. ACOSTA, ERENEO A. SEGARINO, JR., WILDREDO A. RAUTO,
DIOSDADO A. ACOSTA, BONIFACIO G. SISMO, TACIO ALUBA,
DANIEL B. BATERZAL, ELISEO YBAEZ, DIOSDADO E. HANCHIC,
EDDIE ESCALICAS, ELEAZAR B. BATERZAL, DOMINADOR HALICHIC,
ROOSEVELT RISMO-AN, ROBERT C. MERCADER, TIRSO ARESGADO,
DANIEL CHAVEZ, DANILO CHAVEZ, VICTOR VILLAROEL, ERNESTO
C. YABANEZ, ARMANDO T. SANTILLAN, RUDY S. SANTILLAN,
JODJEN ILUSTRISIMO, NESTOR SALANGRON, ALBERTO
SALANGRON, ROGER L. ROXAS, FRANCISCO T. ANTICANO, PASTOR
SALANGRON, BIENVENIDO SANTILLAN, GILBUENA LADDY, FIDEL
 BENJAMIN JOVELITO BELGANO, HONEY PARIOL, ANTONIO
SALANGRON, NICASIO SALANGRON, & AIRLINE SHIPPERS
ASSOCIATION OF PALAWAN, petitioners,
vs.
GOV. SALVADOR P. SOCRATES, MEMBERS OF SANGGUNIAN
PANLALAWIGAN OF PALAWAN, namely, VICE-GOVERNOR JOEL T.
REYES, JOSE D.ZABALA, ROSALINO R. ACOSTA, JOSELITO A.
CADLAON, ANDRES R. BAACO, NELSON P. PENEYRA, CIPRIANO C.
BARROMA, CLARO E. ORDINARIO, ERNESTO A. LLACUN, RODOLFO
C. FLORDELIZA, GILBERT S. BAACO, WINSTON G. ARZAGA,
NAPOLEON F. ORDONEZ and GIL P. ACOSTA, CITY MAYOR EDWARD
HAGEDORN, MEMBERS OF SANGGUNIANG PANLUNGSOD NG
PUERTO PRINCESA, ALL MEMBERS OF BANTAY DAGAT, MEMBERS
OF PHILIPPINE NATIONAL POLICE OF PALAWAN, PROVINCIAL AND
CITY PROSECUTORS OF PALAWAN and PUERTO PRINCESA CITY,
and ALL JUDGES OF PALAWAN, REGIONAL, MUNICIPAL AND
METROPOLITAN, respondents.
DECISION
DAVIDE, JR., J.:
Petitioners caption their petition as one for Certiorari, Injunction With Preliminary
Mandatory Injunction,with Prayer for Temporary Restraining Order and pray that this
Court: (1) declare as unconstitutional: (a) Ordinance No. 15-92, dated 15 December
1992, of the Sangguniang Panlungsod of Puerto Princesa; (b) Office Order No. 23,
Series of 1993, dated 22 January 1993, issued by Acting City Mayor Amado L. Lucero
of Puerto Princesa City; and (c) Resolution No. 33, Ordinance No. 2, Series of 1993,
dated 19 February 1993, of the Sangguniang Panlalawigan of Palawan; (2) enjoin the
enforcement thereof; and (3) restrain respondents Provincial and City Prosecutors of
Palawan and Puerto Princesa City and Judges of Regional Trial Courts, Metropolitan
Trial Courts[1] and Municipal Circuit Trial Courts in Palawan from assuming jurisdiction
over and hearing cases concerning the violation of the Ordinances and of the Office
Order.
More appropriately, the petition is, and shall be treated as, a special civil action
for certiorari and prohibition.
The following is petitioners summary of the factual antecedents giving rise to the
petition:
1. On December 15, 1992, the Sangguniang Panlungsod ng Puerto Princesa City
enacted Ordinance No. 15-92 which took effect on January 1, 1993 entitled: AN
ORDINANCE BANNING THE SHIPMENT OF ALL LIVE FISH AND LOBSTER
OUTSIDE PUERTO PRINCESA CITY FROM JANUARY 1, 1993 TO JANUARY 1,
1998 AND PROVIDING EXEMPTIONS, PENALTIES AND FOR OTHER PURPOSES
THEREOF, the full text of which reads as follows:
Section 1. Title of the Ordinance. - This Ordinance is entitled: AN ORDINANCE
BANNING THE SHIPMENT OF ALL LIVE FISH AND LOBSTER OUTSIDE PUERTO
PRINCESA CITY FROM JANUARY 1, 1993 TO JANUARY 1, 1998 AND PROVIDING
EXEMPTIONS, PENALTIES AND FOR OTHER PURPOSES THEREOF.
Section 2. Purpose, Scope and Coverage. - To effectively free our City Sea Waters
from Cyanide and other Obnoxious substance, and shall cover all persons and/or
entities operating within and outside the City of Puerto Princesa who is are [sic]
directly or indirectly in the business or shipment of live fish and lobster outside the
City.
Section 3. Definition of terms. - For purpose of this Ordinance the following are hereby
defined:
A. SEA BASS - A kind of fish under the family of Centropomidae, better known as
APAHAP;
B. CATFISH - A kind of fish under the family of Plotosidae, better known as HITO-
HITO;
C. MUDFISH - A kind of fish under the family of Orphicaphalisae better known as
DALAG
D. ALL LIVE FISH - All alive, breathing not necessarily moving of all specie[s] use for
food and for aquarium purposes.
E. LIVE LOBSTER - Several relatively, large marine crustaceans of the genus
Homarus that are alive and breathing not necessarily moving.
Section 4. It shall be unlawful [for] any person or any business enterprise or company
to ship out from Puerto Princesa City to any point of destination either via aircraft or
seacraft of any live fish and lobster except SEA BASS, CATFISH, MUDFISH, AND
MILKFISH FRIES.
Section 5. Penalty Clause. - Any person/s and or business entity violating this
Ordinance shall be penalized with a fine of not more than P5,000.00 or imprisonment
of not more than twelve (12) months, cancellation of their permit to do business in the
City of Puerto Princesa or all of the herein stated penalties, upon the discretion of the
court.
Section 6. If the owner and/or operator of the establishment found vilating the
provisions of this ordinance is a corporation or a partnership, the penalty prescribed in
Section 5 hereof shall be imposed upon its president and/or General Manager or
Managing Partner and/or Manager, as the case maybe [sic].
Section 7. Any existing ordinance or any provision of any ordinance inconsistent to
[sic] this ordinance is deemed repealed.
Section 8. This Ordinance shall take effect on January 1, 1993.
SO ORDAINED.
xxx
2. To implement said city ordinance, then Acting City Mayor Amado L. Lucero issued
Office Order No. 23, Series of 1993 dated January 22, 1993 which reads as follows:
In the interest of public service and for purposes of City Ordinance No. PD426-14-74,
otherwise known as AN ORDINANCE REQUIRING ANY PERSON ENGAGED OR
INTENDING TO ENGAGE IN ANY BUSINESS, TRADE, OCCUPATION, CALLING
OR PROFESSION OR HAVING IN HIS POSSESSION ANY OF THE ARTICLES FOR
WHICH A PERMIT IS REQUIRED TO BE HAD, TO OBTAIN FIRST A MAYORS
PERMIT and City Ordinance No. 15-92, AN ORDINANCE BANNING THE SHIPMENT
OF ALL LIVE FISH AND LOBSTER OUTSIDE PUERTO PRINCESA CITY FROM
JANUARY 1, 1993 TO JANUARY 1, 1998, you are hereby authorized and directed to
check or conduct necessary inspections on cargoes containing live fish and lobster
being shipped out from the Puerto Princesa Airport, Puerto Princesa Wharf or at any
port within the jurisdiction of the City to any point of destinations [sic] either via aircraft
or seacraft.
The purpose of the inspection is to ascertain whether the shipper possessed the
required Mayors Permit issued by this Office and the shipment is covered by invoice
or clearance issued by the local office of the Bureau of Fisheries and Aquatic
Resources and as to compliance with all other existing rules and regulations on the
matter.
Any cargo containing live fish and lobster without the required documents as stated
herein must be held for proper disposition.
In the pursuit of this Order, you are hereby authorized to coordinate with the PAL
Manager, the PPA Manager, the local PNP Station and other offices concerned for the
needed support and cooperation.Further, that the usual courtesy and diplomacy must
be observed at all times in the conduct of the inspection.
Please be guided accordingly.
xxx
3. On February 19, 1993, the Sangguniang Panlalawigan, Provincial Government of
Palawan enacted Resolution No. 33 entitled: A RESOLUTION PROHIBITING THE
CATCHING, GATHERING, POSSESSING, BUYING, SELLING AND SHIPMENT OF
LIVE MARINE CORAL DWELLING AQUATIC ORGANISMS, TO WIT:
FAMILY: SCARIDAE (MAMENG), EPINE PHELUS
FASCIATUS(SUNO). CROMILEPTES ALTIVELIS (PANTHER OR SENORITA),
LOBSTER BELOW 200 GRAMS AND SPAWNING, TRADACNA
GIGAS (TAKLOBO), PINCTADA MARGARITEFERA(MOTHER PEARL, OYSTERS,
GIANT CLAMS AND OTHER SPECIES), PENAEUS MONODON (TIGER PRAWN-
BREEDER SIZE OR MOTHER), EPINEPHELUS SUILLUS (LOBA OR GREEN
GROUPER) AND FAMILY: BALISTIDAE (TROPICAL AQUARIUM FISHES) FOR A
PERIOD FIVE (5) YEARS IN AND COMING FROM PALAWAN WATERS, the full text
of which reads as follows:
WHEREAS, scientific and factual researches [sic] and studies disclose that only five
(5) percent of the corals of our province remain to be in excellent condition as [a]
habitat of marine coral dwelling aquatic organisms;
WHEREAS, it cannot be gainsaid that the destruction and devastation of the corals of
our province were principally due to illegal fishing activities like dynamite fishing,
sodium cyanide fishing, use of other obnoxious substances and other related
activities;
WHEREAS, there is an imperative and urgent need to protect and preserve the
existence of the remaining excellent corals and allow the devastated ones to
reinvigorate and regenerate themselves into vitality within the span of five (5) years;
WHEREAS, Sec. 468, Par. 1, Sub-Par. VI of the [sic] R.A. 7160 otherwise known as
the Local Government Code of 1991 empowers the Sangguniang Panlalawigan to
protect the environment and impose appropriate penalties [upon] acts which endanger
the environment such as dynamite fishing and other forms of destructive fishing,
among others.
NOW, THEREFORE, on motion by Kagawad Nelson P. Peneyra and upon unanimous
decision of all the members present;
Be it resolved as it is hereby resolved, to approve Resolution No. 33, Series of 1993 of
the Sangguniang Panlalawigan and to enact Ordinance No. 2 for the purpose, to wit:
ORDINANCE NO. 2
Series of 1993
BE IT ORDAINED BY THE SANGGUNIANG PANLALAWIGAN IN SESSION
ASSEMBLED:
Section 1. TITLE - This Ordinance shall be known as an Ordinance Prohibiting the
catching, gathering, possessing, buying, selling and shipment of live marine coral
dwelling aquatic organisms, to wit: 1.Family: Scaridae (Mameng), 2. Epinephelus
Fasciatus (Suno), 3. Cromileptes altivelis (Panther or Senorita), lobster below 200
grams and spawning), 4. Tridacna Gigas (Taklobo), 5. Pinctada Margaretefera
(Mother Pearl, Oysters, Giant Clams and other species), 6. Penaeus Monodon (Tiger
Prawn-breeder size or mother), 7. Epinephelus Suillus (Loba or Green Grouper) and
8. Family: Balistidae (Topical Aquarium Fishes) for a period of five (5) years in and
coming from Palawan Waters.
Section II. PRELIMINARY CONSIDERATIONS
1. Sec. 2-A (Rep. Act 7160). It is hereby declared, the policy of the state that the
territorial and political subdivisions of the State shall enjoy genuine and meaningful
local autonomy to enable them to attain their fullest development as self reliant
communities and make them more effective partners in the attainment of national
goals. Toward this end, the State shall provide for [a] more responsive and
accountable local government structure instituted through a system of decentralization
whereby local government units shall be given more powers, authority, responsibilities
and resources.
2. Sec. 5-A (R.A. 7160). Any provision on a power of [a] local Government Unit shall
be liberaly interpreted in its favor, and in case of doubt, any question thereon shall be
resolved in favor of devolution of powers and of the lower government units. Any fair
and reasonable doubts as to the existence of the power shall be interpreted in favor of
the Local Government Unit concerned.
3. Sec. 5-C (R.A. 7160). The general welfare provisions in this Code shall be liberally
interpreted to give more powers to local government units in accelerating economic
development and upgrading the quality of life for the people in the community.
4. Sec. 16 (R.A. 7160). General Welfare. - Every local government unit shall exercise
the powers expressly granted, those necessarily implied therefrom, as well as powers
necessary, appropriate, or incidental for its efficient and effective governance; and
those which are essential to the promotion of the general welfare.
Section III. DECLARATION OF POLICY. - It is hereby declared to be the policy of the
Province of Palawan to protect and conserve the marine resources of Palawan not
only for the greatest good of the majority of the present generation but with [the]
proper perspective and consideration of [sic] their prosperity, and to attain this end,
the Sangguniang Panlalawigan henceforth declares that is [sic] shall be unlawful for
any person or any business entity to engage in catching, gathering, possessing,
buying, selling and shipment of live marine coral dwelling aquatic organisms as
enumerated in Section 1 hereof in and coming out of Palawan Waters for a period of
five (5) years;
Section IV. PENALTY CLAUSE. - Any person and/or business entity violating this
Ordinance shall be penalized with a fine of not more than Five Thousand Pesos
(P5,000.00), Philippine Currency, and/or imprisonment of six (6) months to twelve (12)
months and confiscation and forfeiture of paraphernalias [sic] and equipment in favor
of the government at the discretion of the Court;
Section V. SEPARABILITY CLAUSE. - If for any reason, a Section or provision of this
Ordinance shall be held as unconditional [sic] or invalid, it shall not affect the other
provisions hereof.
Section VI. REPEALING CLAUSE. - Any existing Ordinance or a provision of any
ordinance inconsistent herewith is deemed modified, amended or repealed.
Section VII. EFFECTIVITY. - This Ordinance shall take effect ten (10) days after its
publication.
SO ORDAINED.
xxx
4. The respondents implemented the said ordinances, Annexes A and C hereof
thereby depriving all the fishermen of the whole province of Palawan and the City of
Puerto Princesa of their only means of livelihood and the petitioners Airline Shippers
Association of Palawan and other marine merchants from performing their lawful
occupation and trade;
5. Petitioners Alfredo Tano, Baldomero Tano, Teocenes Midello, Angel de Mesa,
Eulogio Tremocha, and Felipe Ongonion, Jr. were even charged criminally under
criminal case no. 93-05-C in the 1st Municipal Circuit Trial Court of Cuyo-Agutaya-
Magsaysay, an original carbon copy of the criminal complaint dated April 12, 1993 is
hereto attached as Annex D; while xerox copies are attached as Annex D to the
copies of the petition;
6. Petitioners Robert Lim and Virginia Lim, on the other hand, were charged by the
respondent PNP with the respondent City Prosecutor of Puerto Princesa City, a xerox
copy of the complaint is hereto attached as Annex E;
Without seeking redress from the concerned local government units,
prosecutors office and courts, petitioners directly invoked our original jurisdiction by
filing this petition on 4 June 1993. In sum, petitioners contend that:
First, the Ordinances deprived them of due process of law, their livelihood, and
unduly restricted them from the practice of their trade, in violation of Section 2, Article
XII and Sections 2 and 7 of Article XIII of the 1987 Constitution.
Second, Office Order No. 23 contained no regulation nor condition under which
the Mayors permit could be granted or denied; in other words, the Mayor had the
absolute authority to determine whether or not to issue permit.
Third, as Ordinance No. 2 of the Province of Palawan altogether prohibited the
catching, gathering, possession, buying, selling and shipping of live marine coral
dwelling organisms, without any distinction whether it was caught or gathered through
lawful fishing method, the Ordinance took away the right of petitioners-fishermen to
earn their livelihood in lawful ways; and insofar as petitioners-members of Airline
Shippers Association are concerned, they were unduly prevented from pursuing their
vocation and entering into contracts which are proper, necessary, and essential to
carry out their business endeavors to a successful conclusion.
Finally, as Ordinance No. 2 of the Sangguniang Panlalawigan is null and void,
the criminal cases based thereon against petitioners Tano and the others have to be
dismissed.
In the Resolution of 15 June 1993 we required respondents to comment on the
petition, and furnished the Office of the Solicitor General with a copy thereof.
In their comment filed on 13 August 1993, public respondents Governor
Socrates and Members of the Sangguniang Panlalawigan of Palawan defended the
validity of Ordinance No.2, Series of 1993, as a valid exercise of the Provincial
Governments power under the general welfare clause (Section 16 of the Local
Government Code of 1991 [hereafter, LGC]), and its specific power to protect the
environment and impose appropriate penalties for acts which endanger the
environment, such as dynamite fishing and other forms of destructive fishing under
Section 447 (a) (1) (vi), Section 458 (a) (1) (vi), and Section 468 (a) (1) (vi), of the
LGC. They claimed that in the exercise of such powers, the Province of Palawan had
the right and responsibilty to insure that the remaining coral reefs, where fish dwells
[sic], within its territory remain healthy for the future generation. The Ordinance, they
further asserted, covered onlylive marine coral dwelling aquatic organisms which were
enumerated in the ordinance and excluded other kinds of live marine aquatic
organisms not dwelling in coral reefs; besides the prohibition was for only five (5)
years to protect and preserve the pristine coral and allow those damaged to
regenerate.
Aforementioned respondents likewise maintained that there was no violation of
due process and equal protection clauses of the Constitution. As to the former, public
hearings were conducted before the enactment of the Ordinance which, undoubtedly,
had a lawful purpose and employed reasonable means; while as to the latter, a
substantial distinction existed between a fisherman who catches live fish with the
intention of selling it live, and a fisherman who catches live fish with no intention at all
of selling it live, i.e., the former uses sodium cyanide while the latter does not. Further,
the Ordinance applied equally to all those belonging to one class.
On 25 October 1993 petitioners filed an Urgent Plea for the Immediate Issuance
of a Temporary Restraining Order claiming that despite the pendency of this case,
Branch 50 of the Regional Trial Court of Palawan was bent on proceeding with
Criminal Case No. 11223 against petitioners Danilo Tano, Alfredo Tano, Eulogio
Tremocha, Romualdo Tano, Baldomero Tano, Andres Lemihan and Angel de Mesa
for violation of Ordinance No. 2 of the Sangguniang Panlalawigan of Palawan. Acting
on said plea, we issued on 11 November 1993 a temporary restraining order directing
Judge Angel Miclat of said court to cease and desist from proceeding with the
arraignment and pre-trial of Criminal Case No. 11223.
On 12 July 1994, we excused the Office of the Solicitor General from filing a
comment, considering that as claimed by said office in its Manifestation of 28 June
1994, respondents were already represented by counsel.
The rest of the respondents did not file any comment on the petition.
In the resolution of 15 September 1994, we resolved to consider the comment
on the petition as the Answer, gave due course to the petition and required the parties
to submit their respective memoranda.[2]
On 22 April 1997 we ordered impleaded as party respondents the Department
of Agriculture and the Bureau of Fisheries and Aquatic Resources and required the
Office of the Solicitor General to comment on their behalf. But in light of the latters
motion of 9 July 1997 for an extension of time to file the comment which would only
result in further delay, we dispensed with said comment.
After due deliberation on the pleadings filed, we resolved to dismiss this petition
for want of merit, on 22 July 1997, and assigned it to the ponente for the writing of the
opinion of the Court.
I DECLARATORY RELIEF, i.e., for a declaration that the Ordinances in question are a
There are actually two sets of petitioners in this case. The first is composed of
Alfredo Tano, Baldomero Tano, Danilo Tano, Romualdo Tano, Teocenes Midello,
Angel de Mesa, Eulogio Tremocha, Felipe Ongonion, Jr., Andres Linijan, and Felimon
de Mesa, who were criminally charged with violating Sangguniang
Panlalawigan Resolution No. 33 and Ordinance No. 2, Series of 1993, of the Province
of Palawan, in Criminal Case No. 93-05-C of the 1st Municipal Circuit Trial Court
(MCTC) of Palawan;[3] and Robert Lim and Virginia Lim who were charged with
violating City Ordinance No. 15-92 of Puerto Princesa City and Ordinance No. 2,
Series of 1993, of the Province of Palawan before the Office of the City Prosecutor of
Puerto Princesa.[4] All of them, with the exception of Teocenes Midello, Felipe
Ongonion, Jr., Felimon de Mesa, Robert Lim and Virginia Lim, are likewise the
accused in Criminal Case No. 11223 for the violation of Ordinance No. 2 of
the Sangguniang Panlalawigan of Palawan, pending before Branch 50 of the Regional
Trial Court of Palawan.[5]
The second set of petitioners is composed of the rest of the petitioners
numbering seventy-seven (77), all of whom, except the Airline Shippers Association of
Palawan -- an alleged private association of several marine merchants -- are natural
persons who claim to be fishermen.
The primary interest of the first set of petitioners is, of course, to prevent the
prosecution, trial and determination of the criminal cases until the constitutionality or
legality of the Ordinances they allegedly violated shall have been resolved. The
second set of petitioners merely claim that they being fishermen or marine merchants,
they would be adversely affected by the ordinances.
As to the first set of petitioners, this special civil for certiorari must fail on the
ground of prematurity amounting to a lack of cause of action. There is no showing that
the said petitioners, as the accused in the criminal cases, have filed motions to quash
the informations therein and that the same were denied. The ground available for such
motions is that the facts charged therein do not constitute an offense because the
ordinances in question are unconstitutional.[6] It cannot then be said that the lower
courts acted without or in excess of jurisdiction or with grave abuse of discretion to
justify recourse to the extraordinary remedy of certiorari or prohibition. It must further
be stressed that even if the petitioners did file motions to quash, the denial thereof
would not forthwith give rise to a cause of action under Rule 65 of the Rules of
Court. The general rule is that where a motion to quash is denied, the remedy
therefrom is notcertiorari, but for the party aggrieved thereby to go to trial without
prejudice to reiterating special defenses involved in said motion, and if, after trial on
the merits of adverse decision is rendered, to appeal therefrom in the manner
authorized by law.[7] And , even where in an exceptional circumstance such denial
may be the subject of a special civil action for certiorari, a motion for reconsideration
must have to be filed to allow the court concerned an opportunity to correct its errors,
unless such motion may be dispensed with because of existing exceptional
circumstances.[8] Finally, even if a motion for reconsideration has been filed and
denied, the remedy under Rule 65 is still unavailable absent any showing of the
grounds provided for in Section 1 thereof.[9] For obvious reasons, the petition at bar
does not, and could not have , alleged any of such grounds.
As to the second set of petitioners, the instant petition is obviously one for
nullity ... for being unconstitutional.[10] As such, their petition must likewise fail, as this
Court is not possessed of original jurisdiction over petitions for declaratory relief even
if only questions of law are involved,[11] it being settled that the Court merely exercises
appellate jurisdiction over such petitions.[12]
II
Even granting arguendo that the first set of petitioners have a cause of action
ripe for the extraordinary writ of certiorari, there is here a clear disregard of the
hierarchy of courts, and no special and important reason or exceptional or compelling
circumstance has been adduced why direct recourse to us should be allowed. While
we have concurrent jurisdiction with Regional Trial courts and with the Court of
Appeals to issue writs of certiorari, prohibition, mandamus, quo warranto, habeas
corpus and injunction, such concurrence gives petitioners no unrestricted freedom of
choice of court forum, so we held in People v. Cuaresma:[13]
This concurrence of jurisdiction is not to be taken as according to parties seeking any
of the writs an absolute unrestrained freedom of choice of the court to which
application therefor will be directed. There is after all hierarchy of courts. That
hierarchy is determinative of the venue of appeals, and should also serve as a general
determinant of the appropriate forum for petitions for the extraordinary writs. A
becoming regard for that judicial hierarchy most certainly indicates that petitions for
the issuance of extraordinary writs against first level (inferior) courts should be filed
with the Regional Trial Court, and those against the latter, with the Court of Appeals. A
direct invocation of the Supreme Courts original jurisdiction to issue these writs should
be allowed only when there are special and important reasons therefor, clearly and
specifically set out in the petition. This is established policy. It is a policy necessary to
prevent inordinate demands upon the Courts time and attention which are better
devoted to those matters within its exclusive jurisdiction, and to prevent further over-
crowding of the Courts docket.
The Court feels the need to reaffirm that policy at this time, and to enjoin strict
adherence thereto in the light of what it perceives to be a growing tendency on the
part of litigants and lawyers to have their applications for the so-called extraordinary
writs, and sometimes even their appeals, passed upon and adjudicated directly and
immediately by the highest tribunal of the land.
In Santiago v. Vasquez,[14] this Court forcefully expressed that the propensity of
litigants and lawyers to disregard the hierarchy of courts must be put to a halt, not only
because of the imposition upon the precious time of this Court, but also because of
the inevitable and resultant delay, intended or otherwise, in the adjudication of the
case which often has to be remanded or referred to the lower court, the proper forum
under the rules of procedure, or as better equipped to resolve the issues since this
Court is not a trier of facts. We reiterated the judicial policy that this Court will not
entertain direct resort to it unless the redress desired cannot be obtained in the
appropriate courts or where exceptional and compelling circumstances justify
availment of a remedy within and calling for the exercise of [its] primary jurisdiction.
III
Notwithstanding the foregoing procedural obstacles against the first set of
petitioners, we opt to resolve this case on its merits considering that the lifetime of the
challenged Ordinances is about to end. Ordinance No. 15-92 of the City of Puerto
Princesa is effective only up to 1 January 1998, while Ordinance No. 2 of the Province
of Palawan, enacted on 19 February 1993, is effective for only five (5) years. Besides,
these Ordinances were undoubtedly enacted in the exercise of powers under the new
LGC relative to the protection and preservation of the environment and are thus novel
and of paramount importance. No further delay then may be allowed in the resolution
of the issues raised.
It is of course settled that laws (including ordinances enacted by local
government units) enjoy the presumption of constitutionality.[15] To overthrow this
presumption, there must be a clear and unequivocal breach of the Constitution, not
merely a doubtful or argumentative contradiction. In short, the conflict with the
Constitution must be shown beyond reasonable doubt. [16] Where doubt exists, even if
well founded, there can be no finding of unconstitutionality. To doubt is to sustain.[17]
After a scrunity of the challenged Ordinances and the provisions of the
Constitution petitioners claim to have been violated, we find petitioners contentions
baseless and so hold that the former do not suffer from any infirmity, both under the
Constitution and applicable laws.
Petitioners specifically point to Section 2, Article XII and Sections 2 and 7,
Article XIII of the Constitution as having been transgressed by the Ordinances.
The pertinent portion of Section 2 of Article XII reads:
SEC. 2. x x x
The State shall protect the nation's marine wealth in its archipelagic waters, territorial
sea, and exclusive economic zone, and reserve its use and enjoyment exclusively to
Filipino citizens.
The Congress may, by law, allow small-scale utilization of natural resources by
Filipino citizens, as well as cooperative fish farming, with priority to subsistence
fishermen and fishworkers in rivers, lakes, bays, and lagoons.
Sections 2 and 7 of Article XIII provide:
Sec. 2. The promotion of social justice shall include the commitment to create
economic opportunities based on freedom of initiative and self-reliance.
xxx
SEC. 7. The State shall protect the rights of subsistence fishermen, especially of local
communities, to the preferential use of the communal marine and fishing resources,
both inland and offshore. It shall provide support to such fishermen through
appropriate technology and research, adequate financial, production, and marketing
assistance, and other services. The State shall also protect, develop, and conserve
such resources. The protection shall extend to offshore fishing grounds of subsistence
fishermen against foreign intrusion. Fishworkers shall receive a just share from their
labor in the utilization of marine and fishing resources.
There is absolutely no showing that any of the petitioners qualifies as a
subsistence or marginal fisherman. In their petition, petitioner Airline Shippers
Association of Palawan is described as a private association composed of Marine
Merchants; petitioners Robert Lim and Virginia Lim, as merchants; while the rest of the
petitioners claim to be fishermen, without any qualification, however, as to their status.
Since the Constitution does not specifically provide a definition of the terms
subsistence or marginal fishermen,[18] they should be construed in their general and
ordinary sense. Amarginal fisherman is an individual engaged in fishing whose margin
of return or reward in his harvest of fish as measured by existing price levels is barely
sufficient to yield a profit or cover the cost of gathering the fish,[19] while a subsistence
fisherman is one whose catch yields but the irreducible minimum for his
livelihood.[20] Section 131(p) of the LGC (R.A. No. 7160) defines a marginal farmer or
fisherman as an individual engaged in subsistence farming or fishing which shall be
limited to the sale, barter or exchange of agricultural or marine products produced by
himself and his immediate family. It bears repeating that nothing in the record supports
a finding that any petitioner falls within these definitions.
Besides, Section 2 of Article XII aims primarily not to bestow any right to
subsistence fishermen, but to lay stress on the duty of the State to protect the nations
marine wealth. What the provision merely recognizes is that the State may allow, by
law, cooperative fish farming, with priority to subsistence fishermen and fishworkers in
rivers, lakes, bays, and lagoons. Our survey of the statute books reveals that the only
provision of law which speaks of the preferential right of marginal fishermen is Section
149 of the LGC of 1991 which pertinently provides:
SEC. 149. Fishery Rentals, Fees and Charges. -- x x x
(b) The sangguniang bayan may:
(1) Grant fishery privileges to erect fish corrals, oyster, mussels or other aquatic beds
or bangus fry areas, within a definite zone of the municipal waters, as determined by
it: Provided, however, That duly registered organizations and cooperatives of marginal
fishermen shall have preferential right to such fishery privileges ....
In a Joint Administrative Order No. 3, dated 25 April 1996, the Secretary of the
Department of Agriculture and the Secretary of the Department of Interior and Local
Government prescribed the guidelines on the preferential treatment of small fisherfolk
relative to the fishery right mentioned in Section 149. This case, however, does not
involve such fishery right.
Anent Section 7 of Article XIII, it speaks not only of the use of communal marine
and fishing resources, but of their protection, development, and conservation. As
hereafter shown, the ordinances in question are meant precisely to protect and
conserve our marine resources to the end that their enjoyment by the people may be
guaranteed not only for the present generation, but also for the generations to come.
The so-called preferential right of subsistence or marginal fishermen to the use
of marine resources is not at all absolute. In accordance with the Regalian Doctrine,
marine resources belong to the State, and, pursuant to the first paragraph of Section
2, Article XII of the Constitution, their exploration, development and utilization ... shall
be under the full control and supervision of the State. Moreover, their mandated
protection, development, and conservation as necessarily recognized by the framers
of the Constitution, imply certain restrictions on whatever right of enjoyment there may
be in favor of anyone. Thus, as to the curtailment of the preferential treatment of
marginal fisherman, the following exchange between Commissioner Francisco
Rodrigo and Commissioner Jose F.S. Bengzon, Jr., took place at the plenary session
of the Constitutional Commission:
MR. RODRIGO:
Let us discuss the implementation of this because I would not raise the
hopes of our people, and afterwards fail in the implementation. How will
this be implemented? Will there be a licensing or giving of permits so that
government officials will know that one is really a marginal fisherman? Or
if policeman say that a person is not a marginal fisherman, he can show
his permit, to prove that indeed he is one.
MR. BENGZON:
Certainly, there will be some mode of licensing insofar as this is
concerned and this particular question could be tackled when we discuss
the Article on Local Governments -- whether we will leave to the local
governments or to Congress on how these things will be
implemented. But certainly, I think our Congressmen and our local
officials will not be bereft of ideas on how to implement this mandate.
xxx
MR. RODRIGO:
So, once one is licensed as a marginal fisherman, he can go anywhere in
the Philippines and fish in any fishing grounds.
MR. BENGZON:
Subject to whatever rules and regulations and local laws that may be
passed, may be existing or will be passed.[21] (underscoring supplied for
emphasis).
What must likewise be borne in mind is the state policy enshrined in the
Constitution regarding the duty of the State to protect and advance the right of the
people to a balanced and healthful ecology in accord with the rhythm and harmony of
nature.[22] On this score, in Oposa v. Factoran,[23] this Court declared:
While the right to balanced and healthful ecology is to be found under the Declaration
of Principles the State Policies and not under the Bill of Rights, it does not follow that it
is less important than any of the civil and political rights enumerated in the latter. Such
a right belongs to a different category of rights altogether for it concerns nothing less
than self-preservation and self-perpetuation - aptly and fittingly stressed by the
petitioners - the advancement of which may even be said to predate all governments
and constitutions. As a matter of fact, these basic rights need not even be written in
the Constitution for they are assumed to exist from the inception of humankind. If they
are now explicitly mentioned in the fundamental charter, it is because of the well-
founded fear of its framers that unless the rights to a balanced and healthful ecology
and to health are mandated as state policies by the Constitution itself, thereby
highlighting their continuing importance and imposing upon the state a solemn
obligation to preserve the first and protect and advance the second , the day would not
be too far when all else would be lost not only for the present generation, but also for
those to come - generations which stand to inherit nothing but parched earth
incapable of sustaining life.
The right to a balanced and healthful ecology carries with it a correlative duty to refrain
from impairing the environment ...
The LGC provisions invoked by private respondents merely seek to give flesh
and blood to the right of the people to a balanced and healthful ecology. In fact, the
General Welfare Clause, expressly mentions this right:
SEC. 16. General Welfare.-- Every local government unit shall exercise the powers
expressly granted, those necessarily implied therefrom, as well as powers necessary,
appropriate, or incidental for its efficient and effective governance, and those which
are essential to the promotion of the general welfare. Within their respective territorial
jurisdictions, local government units shall ensure and support, among other things, the
preservation and enrichment of culture, promote health and safety, enhance the right
of the people to a balanced ecology, encourage and support the development of
appropriate and self-reliant scientific and technological capabilities, improve public
morals, enhance economic prosperity and social justice, promote full employment
among their residents, maintain peace and order, and preserve the comfort and
convenience of their inhabitants. (underscoring supplied).
Moreover, Section 5(c) of the LGC explicitly mandates that the general welfare
provisions of the LGC shall be liberally interpreted to give more powers to the local
government units in accelerating economic development and upgrading the quality of
life for the people of the community.
The LGC vests municipalities with the power to grant fishery privileges in
municipal waters and to impose rentals, fees or charges therefor; to penalize, by
appropriate ordinances, the use of explosives, noxious or poisonous substances,
electricity, muro-ami, and other deleterious methods of fishing; and to prosecute any
violation of the provisions of applicable fishery laws. Further, the sangguniang bayan,
the sangguniang panlungsod and the sangguniang panlalawigan are directed to enact
ordinances for the general welfare of the municipality and its inhabitants, which shall
include, inter alia, ordinances that [p]rotect the environment and impose appropriate
penalties for acts which endanger the environment such as dynamite fishing and other
forms of destructive fishing ... and such other activities which result in pollution,
acceleration of eutrophication of rivers and lakes or of ecological imbalance.[
Finally, the centerpiece of LGC is the system of decentralization[26] as expressly
mandated by the Constitution.[27] Indispensable thereto is devolution and the LGC
expressly provides that [a]ny provision on a power of a local government unit shall be
liberally interpreted in its favor, and in case of doubt, any question thereon shall be
resolved in favor of devolution of powers and of the lower local government unit. Any
fair and reasonable doubt as to the existence of the power shall be interpreted in favor
of the local government unit concerned,[28]Devolution refers to the act by which the
National Government confers power and authority upon the various local government
units to perform specific functions and responsibilities.[29]
One of the devolved powers enumerated in the section of the LGC on
devolution is the enforcement of fishery laws in municipal waters including the
conservation of mangroves. This necessarily includes enactment of ordinances to
effectively carry out such fishery laws within the municipal waters.
The term municipal waters, in turn, include not only streams, lakes, and tidal
waters within the municipality, not being the subject of private ownership and not
comprised within the national parks, public forest, timber lands, forest reserves, or
fishery reserves, but also marine waters included between two lines drawn
perpendicularly to the general coastline from points where the boundary lines of the
municipality or city touch the sea at low tide and a third line parallel with the general
coastline and fifteen kilometers from it.[31] Under P.D. No. 704, the marine waters
included in municipal waters is limited to three nautical miles from the general
coastline using the above perpendicular lines and a third parallel line.
These fishery laws which local government units may enforce under Section
17(b), (2), (i) in municipal waters include: (1) P.D. No. 704; (2) P.D. No. 1015
which, inter alia, authorizes the establishment of a closed season in any Philippine
water if necessary for conservation or ecological purposes; (3) P.D. No. 1219 which
provides for the exploration, exploitation, utilization, and conservation of coral
resources; (4) R.A. No. 5474, as amended by B.P. Blg. 58, which makes it unlawful for
any person, association, or corporation to catch or cause to be caught, sell, offer to
sell, purchase, or have in possession any of the fish specie
called gobiidae or ipon during closed season; and (5) R.A. No. 6451 which prohibits
and punishes electrofishing, as well as various issuances of the BFAR.
To those specifically devolved insofar as the control and regulation of fishing in
municipal waters and the protection of its marine environment are concerned, must be
added the following:
1. Issuance of permits to construct fish cages within municipal waters;
2. Issuance of permits to gather aquarium fishes within municipal waters;
3. Issuance of permits to gather kapis shells within municipal waters;
4. Issuance of permits to gather/culture shelled mollusks within municipal
waters;
5. Issuance of licenses to establish seaweed farms within municipal
waters;
6. Issuance of licenses to establish culture pearls within municipal waters;
7. Issuance of auxiliary invoice to transport fish and fishery products; and
8. Establishment of closed season in municipal waters.
These functions are covered in the Memorandum of Agreement of 5 April 1994
between the Department of Agriculture and the Department of Interior and Local
Government.
In light then of the principles of decentralization and devolution enshrined in the
LGC and the powers granted to local government units under Section 16 (the General
Welfare Clause), and under Sections 149, 447 (a) (1) (vi), 458 (a) (1) (vi) and 468 (a)
(1) (vi), which unquestionably involve the exercise of police power, the validity of the
questioned Ordinances cannot be doubted.
Parenthetically, we wish to add that these Ordinances find full support under
R.A. No. 7611, otherwise known as the Strategic Environmental Plan (SEP) for
Palawan Act, approved on 19 July 1992. This statute adopts a comprehensive
framework for the sustainable development of Palawan compatible with protecting and
enhancing the natural resources and endangered environment of the province, which
shall serve to guide the local government of Palawan and the government agencies
concerned in the formulation and implementation of plans, programs and projects
affecting said province.[32]
At this time then, it would be appropriate to determine the relation between the
assailed Ordinances and the aforesaid powers of the Sangguniang Panlungsod of the
City of Puerto Princesa and the Sangguniang Panlalawigan of the Province of
Palawan to protect the environment. To begin, we ascertain the purpose of the
Ordinances as set forth in the statement of purposes or declaration of policies quoted
earlier.
It is clear to the Court that both Ordinances have two principal objectives or
purposes: (1) to establish a closed season for the species of fish or aquatic animals
covered therein for a period of five years, and (2) to protect the corals of the marine
waters of the City of Puerto Princesa and the Province of Palawan from further
destruction due to illegal fishing activities.
The accomplishment of the first objective is well within the devolved power to
enforce fishery laws in municipal waters, such as P.D. No. 1015, which allows the
establishment of closed seasons. The devolution of such power has been expressly
confirmed in the Memorandum of Agreement of 5 April 1994 between the Department
of Agriculture and the Department of Interior and Local Government.
The realization of the second objective falls within both the general welfare
clause of the LGC and the express mandate thereunder to cities and provinces to
protect the environment and impose appropriate penalties for acts which endanger the
environment.[33]
The destruction of the coral reefs results in serious, if not irreparable, ecological
imbalance, for coral reefs are among the natures life-support systems.[34] They collect,
retain, and recycle nutrients for adjacent nearshore areas such as mangroves,
seagrass beds, and reef flats; provide food for marine plants and animals; and serve
as a protective shelter for aquatic organisms.[35] It is said that [e]cologically, the reefs
are to the oceans what forests are to continents: they are shelter and breeding
grounds for fish and plant species that will disappear without them.[36]
The prohibition against catching live fish stems, in part, from the modern
phenomenon of live-fish trade which entails the catching of so-called exotic tropical
species of fish not only for aquarium use in the West, but also for the market for live
banquet fish [which] is virtually insatiable in ever more affluent Asia. [37] These exotic
species are coral-dwellers, and fishermen catch them by diving in shallow water with
corraline habitats and squirting sodium cyanide poison at passing fish directly or onto
coral crevices; once affected the fish are immobilized [merely stunned] and then
scooped by hand.[38] The diver then surfaces and dumps his catch into a submerged
net attached to the skiff . Twenty minutes later, the fish can swim normally.Back on
shore, they are placed in holding pens, and within a few weeks, they expel the cyanide
from their system and are ready to be hauled. Then they are placed in saltwater tanks
or packaged in plastic bags filled with seawater for shipment by air freight to major
markets for live food fish.[39] While the fish are meant to survive, the opposite holds
true for their former home as [a]fter the fisherman squirts the cyanide, the first thing to
perish is the reef algae, on which fish feed. Days later, the living coral starts to
expire. Soon the reef loses its function as habitat for the fish, which eat both the algae
and invertebrates that cling to the coral. The reef becomes an underwater graveyard,
its skeletal remains brittle, bleached of all color and vulnerable to erosion from the
pounding of the waves.[40] It has been found that cyanide fishing kills most hard and
soft corals within three months of repeated application.[41]
The nexus then between the activities barred by Ordinance No. 15-92 of the
City of Puerto Princesa and the prohibited acts provided in Ordinance No. 2, Series of
1993 of the Province of Palawan, on one hand, and the use of sodium cyanide, on the
other, is painfully obvious. In sum, the public purpose and reasonableness of the
Ordinances may not then be controverted.
As to Office Order No. 23, Series of 1993, issued by Acting City Mayor Amado
L. Lucero of the City of Puerto Princesa, we find nothing therein violative of any
constitutional or statutory provision. The Order refers to the implementation of the
challenged ordinance and is not the Mayors Permit.
The dissenting opinion of Mr. Justice Josue N. Bellosillo relies upon the lack of
authority on the part of the Sangguniang Panlungsod of Puerto Princesa to enact
Ordinance No. 15, Series of 1992, on the theory that the subject thereof is within the
jurisdiction and responsibility of the Bureau of Fisheries and Aquatic Resources
(BFAR) under P.D. No. 704, otherwise known as the Fisheries Decree of 1975; and
that, in any event, the Ordinance is unenforceable for lack of approval by the
Secretary of the Department of Natural Resources (DNR), likewise in accordance with
P.D. No. 704.
The majority is unable to accommodate this view. The jurisdiction and
responsibility of the BFAR under P. D. no. 704, over the management, conservation,
development, protection, utilization and disposition of all fishery and aquatic resources
of the country is not all-encompassing. First, Section 4 thereof excludes from such
jurisdiction and responsibility municipal waters, which shall be under the municipal or
city government concerned, except insofar as fishpens and seaweed culture in
municipal in municipal centers are concerned. This section provides, however, that all
municipal or city ordinances and resolutions affecting fishing and fisheries and any
disposition thereunder shall be submitted to the Secretary of the Department of
Natural Resources for appropriate action and shall have full force and effect only upon
his approval.[42]
Second, it must at once be pointed out that the BFAR is no longer under the
Department of Natural Resources (now Department of Environment and Natural
Resources). Executive Order No. 967 of 30 June 1984 transferred the BFAR from the
control and supervision of the Minister (formerly Secretary) of Natural Resources to
the Ministry of Agriculture and Food (MAF) and converted it into a mere staff agency
thereof, integrating its functions with the regional offices of the MAF.
In Executive Order No. 116 of 30 January 1987, which reorganized the MAF,
the BFAR was retained as an attached agency of the MAF. And under the
Administrative Code of 1987,[43]the BFAR is placed under the Title concerning the
Department of Agriculture.[44]
Therefore, it is incorrect to say that the challenged Ordinance of the City of
Puerto Princesa is invalid or unenforceable because it was not approved by the
Secretary of the DENR. If at all, the approval that should be sought would be that of
the Secretary of the Department of Agriculture (not DENR) of municipal ordinances
affecting fishing and fisheries in municipal waters has been dispensed with in view of
the following reasons:
(1) Section 534 (Repealing Clause) of the LGC expressly repeals or amends
Section 16 and 29 of P.D. No. 704[45] insofar that they are inconsistent with the
provisions of the LGC.
(2) As discussed earlier, under the general welfare clause of the LGC, local
government units have the power, inter alia, to enact ordinances to enhance the right
of the people to a balanced ecology. It likewise specifically vests municipalities with
the power to grant fishery privileges in municipal waters, and impose rentals, fees or
charges therefor; to penalize, by appropriate ordinances, the use of explosives,
noxious or poisonous substances, electricity, muro-ami, and other deleterious
methods of fishing; and to prosecute other methods of fishing; and to prosecute any
violation of the provisions of applicable fishing laws.[46] Finally, it imposes upon
the sangguniang bayan, the sangguniang panlungsod, and the sangguniang
panlalawigan the duty to enact ordinances to [p]rotect the environment and impose
appropriate penalties for acts which endanger the environment such as dynamite
fishing and other forms of destructive fishing and such other activities which result in
pollution, acceleration of eutrophication of rivers and lakes or of ecological
imbalance.[47]
In closing, we commend the Sangguniang Panlungsod of the City of Puerto
Princesa and Sangguniang Panlalawigan of the Province of Palawan for exercising
the requisite political will to enact urgently needed legislation to protect and enhance
the marine environment, thereby sharing in the herculean task of arresting the tide of
ecological destruction. We hope that other local government units shall now be roused
from their lethargy and adopt a more vigilant stand in the battle against the decimation
of our legacy to future generations. At this time, the repercussions of any further delay
in their response may prove disastrous, if not, irreversible.
WHEREFORE, the instant petition is DISMISSED for lack of merit and the
temporary restraining order issued on 11 November 1993 is LIFTED.
No pronouncement as to costs.
SO ORDERED.
EN BANC
G.R. No. 115044 January 27, 1995
c. order dated 20 April 1994 reiterating the previous order
directing Mayor Lim to immediately issue thepermit/license to
Associated Development Corporation (ADC).
The order dated 28 march 1994 was in turn issued upon motion by ADC for execution
of a final judgment rendered on 9 September 1988 which ordered the Manila Mayor to
immediately issue to ADC the permit/license to operate the jai-alai in Manila, under
Manila Ordinance No. 7065.
On 13 September 1994, petitioner Guingona (as executive secretary) issued a
directive to then chairman of the Games and Amusements Board (GAB) Francisco R.
Sumulong, jr. to hold in abeyance the grant of authority, or if any had been issued, to
withdraw such grant of authority, to Associated Development Corporation to operate
the jai-alai in the City of Manila, until the following legal questions are properly
resolved:

HON. ALFREDO S. LIM, in his capacity as Mayor of Manila, and the City of 1. Whether P.D. 771 which revoked all existing Jai-Alai
Manila, petitioners, franchisers issued by local governments as of 20 August 1975 is
vs. unconstitutional.
HON. FELIPE G. PACQUING, as Judge, branch 40, Regional Trial Court of Manila 2. Assuming that the City of Manila had the power on 7
and ASSOCIATED CORPORATION, respondents. September 1971 to issue a Jai-Alai franchise to Associated
G.R. No. 117263 January 27, 1995 Development Corporation, whether the franchise granted is valied
considering that the franchise has no duration, and appears to be
TEOFISTO GUINGONA, JR. and DOMINADOR R. CEPEDA, petitioners, granted in perpetuity.
vs.
HON. VETINO REYES and ASSOCIATED DEVELOPMENT 3. Whether the City of Manila had the power to issue a Jai-Alai
CORPORATION, respondents. franchise to Associated Development Corporation on 7
September 1971 in view of executive Order No. 392 dated 1
January 1951 which transferred from local governments to the
Games and Amusements Board the power to regulate Jai-Alai. 1
PADILLA, J.:
On 15 September 1994, respondent Associated Development Corporation (ADC) filed
These two (2) cases which are inter-related actually involve simple issues. if these a petition for prohibition,mandamus, injunction and damages with prayer for temporary
issues have apparently become complicated, it is not by reason of their nature restraining order and/or writ of preliminary injunction in the Regional Trial Court of
because of the events and dramatis personae involved. Manila against petitioner Guingona and then GAB chairman Sumulong, docketed as
The petition in G.R. No. 115044 was dismissed by the First Division of this Court on Civil Case No. 94-71656, seeking to prevent GAB from withdrawing the provisional
01 September 1994 based on a finding that there was "no abuse of discretion, much authority that had earlier been granted to ADC. On the same day, the RTC of Manila,
less lack of or excess of jurisdiction, on the part of respondent judge [Pacquing]", in Branch 4, through presiding Judge Vetino Reyes, issued a temporary restraining order
issuing the questioned orders. Judge Pacquing had earlier issued in Civil Case No. enjoining the GAB from withdrawing ADC's provisional authority. This temporary
88-45660, RTC of Manila, Branch 40, the following orders which were assailed by the restraining order was converted into a writ of preliminary injunction upon ADC's
Mayor of the City of Manila, Hon. Alfredo S. Lim, in said G.R. No. 115044: posting of a bond in the amount of P2,000,000.00. 2

a. order dated 28 March 1994 directing Manila mayor Alfredo S.
Lim to issue the permit/license to operate the jai-alai in favor of
Associated Development Corporation (ADC).
b. order dated 11 April 1994 directing mayor Lim to explain why
he should not be cited for contempt for non-compliance with the
order dated 28 March 1994.
Subsequently, also in G.R. No. 115044, the Republic of the Philippines, through the
Games and Amusements Board, filed a "Motion for Intervention; for Leave to File a
Motion for reconsideration in Intervention; and to Refer the case to the Court En Banc"
and later a "Motion for Leave to File Supplemental Motion for Reconsideration-in-
Intervention and to Admit Attached Supplemental Motion for Reconsideration-in-
Intervention".
In an En Banc Resolution dated 20 September 1994, this Court referred G.R. No.
115044 to the Court En Banc and required the respondents therein to comment on the
aforementioned motions.
Meanwhile, Judge Reyes on 19 October 1994 issued another order, this time, granting
ADC a writ of preliminarymandatory injunction against Guingona and GAB to compel
them to issue in favor of ADC the authority to operate jai-alai.
Guingona, as executive secretary, and Dominador Cepeda, Jr. as the new GAB
chairman, then filed the petition in G.R. No. 117263 assailing the abovementioned
orders of respondent Judge Vetino Reyes.
On 25 October 1994, in G.R. No. 117263, this Court granted petitioner's motion
for leave to file supplemental petition and to admit attached supplemental petition with
urgent prayer for restraining order. The Court further required respondents to file their
comment on the petition and supplemental petition with urgent prayer for restraining
order. The Court likewise set the case and all incidents thereof for hearing on 10
November 1994.
At the hearing on 10 November 1994, the issues to be resolved were formulated by
the Court as follows:
1. whether or not intervention by the Republic of the Philippines at
this stage of the proceedings is proper;
2. assuming such intervention is proper, whether or not the
Associated Development Corporation has a valid and subsisting
franchise to maintain and operate the jai-alai;
3. whether or not there was grave abuse of discretion committed
by respondent Judge Reyes in issuing the aforementioned
temporary restraining order (later writ of preliminary injunction);
and
4. whether or not there was grave abuse of discretion committed
by respondent Judge Reyes in issuing the aforementioned writ of
preliminary mandatory injunction.
On the issue of the propriety of the intervention by the Republic of the Philippines, a
question was raised during the hearing on 10 November 1994 as to whether
intervention in G.R. No. 115044 was the proper remedy for the national government to
take in questioning the existence of a valid ADC franchise to operate the jai-alai or
whether a separate action for quo warranto under Section 2, Rule 66 of the Rules of
Court was the proper remedy.
We need not belabor this issue since counsel for respondent ADC agreed to the
suggestion that this Court once and for all settle all substantive issues raised by the
parties in these cases. Moreover, this Court can consider the petition filed in G.R. No.
117263 as one for quo warranto which is within the original jurisdiction of the Court
under section 5(1), Article VIII of the Constitution. 3
On the propriety of intervention by the Republic, however, it will be recalled that this
Court in Director of Lands v. Court of Appeals (93 SCRA 238) allowed intervention
even beyond the period prescribed in Section 2 Rule 12 of the Rules of Court. The
Court ruled in said case that a denial of the motions for intervention would "lead the
Court to commit an act of injustice to the movants, to their successor-in-interest and to
all purchasers for value and in good faith and thereby open the door to fraud,
falsehood and misrepresentation, should intervenors' claim be proven to be true."
In the present case, the resulting injustice and injury, should the national government's
allegations be proven correct, are manifest, since the latter has squarely questioned
the very existence of a valid franchise to maintain and operate the jai-alai (which is a
gambling operation) in favor of ADC. As will be more extensively discussed later, the
national government contends that Manila Ordinance No. 7065 which purported to
grant to ADC a franchise to conduct jai-alai operations is void and ultra vires since
Republic Act No. 954, approved on 20 June 1953, or very much earlier than said
Ordinance No. 7065, the latter approved 7 September 1971, in Section 4 thereof,
requires alegislative franchise, not a municipal franchise, for the operation of jai-alai.
Additionally, the national government argues that even assuming, arguendo, that the
abovementioned ordinance is valid, ADC's franchise was nonetheless effectively
revoked by Presidential decree No. 771, issued on 20 August 1975, Sec. 3 of which
expressly revoked all existing franchises and permits to operate all forms of gambling
facilities (including the jai-alai) issued by local governments.
On the other hand, ADC's position is that Ordinance No. 7065 was validly enacted by
the City of Manila pursuant to its delegated powers under it charter, Republic Act No.
409. ADC also squarely assails the constitutionality of PD No. 771 as violative of the
equal protection and non-impairment clauses of the Constitution. In this connection,
counsel for ADC contends that this Court should really rule on the validity of PD No.
771 to be able to determine whether ADC continues to possess a valid franchise.
It will undoubtedly be a grave injustice to both parties in this case if this Court were to
shirk from ruling on the issue of constitutionality of PD No. 771. Such issue has, in our
view, become the very lis mota in resolving the present controversy, in view of ADC's
insistence that it was granted a valid and legal franchise by Ordinance No. 7065 to
operate the jai-alai.
The time-honored doctrine is that all laws (PD No. 771 included) are presumed valid
and constitutional until or unless otherwise ruled by this Court. Not only this; Article
XVIII Section 3 of the Constitution states:
Sec. 3. All existing laws, decrees, executive orders,
proclamations, letters of instructions and other executive
issuances not inconsistent with this Constitution shall remain
operative until amended, repealed or revoked.
There is nothing on record to show or even suggest that PD No. 771 has been
repealed, altered or amended by any subsequent law or presidential issuance (when
the executive still exercised legislative powers).
Neither can it be tenably stated that the issue of the continued existence of ADC's
franchise by reason of the unconstitutionality of PD No. 771 was settled in G.R. No.
115044, for the decision of the Court's First Division in said case, aside from not being
final, cannot have the effect of nullifying PD No. 771 as unconstitutional, since only the
Court En Banc has that power under Article VIII, Section 4(2) of the Constitution. 4
And on the question of whether or not the government is estopped from contesting
ADC's possession of a valid franchise, the well-settled rule is that the State cannot be
put in estoppel by the mistakes or errors, if any, of its officials or agents (Republic v.
Intermediate Appellate Court, 209 SCRA 90)
Consequently, in the light of the foregoing expostulation, we conclude that the republic
(in contra distinction to the City of Manila) may be allowed to intervene in G.R. No.
115044. The Republic is intervening in G.R. No. 115044 in the exercise, not of its
business or proprietary functions, but in the exercise of its governmental functions to
protect public morals and promote the general welfare.
II
Anent the question of whether ADC has a valid franchise to operate the Jai-Alai de
Manila, a statement of the pertinent laws is in order.
1. The Charter of the City of Manila was enacted by Congress on 18 June 1949.
Section 18 thereof provides:
Sec. 18. Legislative Powers. The Municipal Board shall have
the following legislative powers:
xxx xxx xxx
(jj) To tax, license, permit and regulate wagers or betting by the
public on boxing, sipa, bowling, billiards, pools, horse and dog
races, cockpits, jai-alai, roller or ice-skating on any sporting or
athletic contests, as well as grant exclusive rights to
establishments for this purpose, notwithstanding any existing law
to the contrary.
2. On 1 January 1951, Executive Order No. 392 was issued transferring the authority
to regulate jai-alais from local government to the Games and Amusements Board
(GAB).
3. On 20 June 1953, Congress enacted Republic Act No. 954, entitled "An Act to
Prohibit With Horse Races and Basque Pelota Games (Jai-Alai), And To Prescribe
Penalties For Its Violation". The provisions of Republic Act No. 954 relating to jai-alai
are as follows:
Sec. 4. No person, or group of persons other than the operator or
maintainer of a fronton with legislative franchise to conduct
basque pelota games (Jai-alai), shall offer, to take or
arrange bets on any basque pelota game or event, or maintain or
use a totalizator or other device, method or system to bet or
gamble on any basque pelota game or event. (emphasis
supplied).
Sec. 5. No person, operator or maintainer of a fronton with
legislative franchise to conduct basque pelota games shall offer,
take, or arrange bets on any basque pelota game or event, or
maintain or use a totalizator or other device, method or system to
bet or gamble on any basque pelota game or eventoutside the
place, enclosure, or fronton where the basque pelota game is
held. (emphasis supplied).
4. On 07 September 1971, however, the Municipal Board of Manila nonetheless
passed Ordinance No. 7065 entitled "An Ordinance Authorizing the Mayor To Allow
And Permit The Associated Development Corporation To Establish, Maintain And
Operate A Jai-Alai In The City Of Manila, Under Certain Terms And Conditions And
For Other Purposes."
5. On 20 August 1975, Presidential Decree No. 771 was issued by then President
Marcos. The decree, entitled "Revoking All Powers and Authority of Local
Government(s) To Grant Franchise, License or Permit And Regulate Wagers Or
Betting By The Public On Horse And Dog Races, Jai-Alai Or Basque Pelota, And
Other Forms Of Gambling", in Section 3 thereof, expressly revoked all existing
franchises and permits issued by local governments.
6. On 16 October 1975, Presidential Decree No. 810, entitled "An Act granting The
Philippine Jai-Alai And Amusement Corporation A Franchise To Operate, Construct
And Maintain A Fronton For Basque Pelota And Similar Games of Skill In THE Greater
Manila Area," was promulgated.
7 On 08 May 1987, then President Aquino, by virtue of Article XVIII, Section 6, of the
Constitution, which allowed the incumbent legislative powers until the first Congress
was convened, issued Executive Order No. 169 expressly repealing PD 810 and
revoking and cancelling the franchise granted to the Philippine Jai-Alai and
Amusement Corporation.
Petitioners in G.R. No. 117263 argue that Republic Act No. 954 effectively removed
the power of the Municipal Board of Manila to grant franchises for gambling
operations. It is argued that the term "legislative franchise" in Rep. Act No. 954 is used
to refer to franchises issued by Congress.
On the other hand, ADC contends that Republic Act N. 409 (Manila Chapter) gives
legislative powers to the Municipal Board to grant franchises, and since Republic Act
No. 954 does not specifically qualify the word "legislative" as referring exclusively to
Congress, then Rep. Act No. 954 did not remove the power of the Municipal Board
under Section 18(jj) of Republic Act No. 409 and consequently it was within the power
of the City of Manila to allow ADC to operate the jai-alai in the City of Manila.
On this point, the government counter-argues that the term "legislative powers" is
used in Rep. Act No. 409 merely to distinguish the powers under Section 18 of the law
from the other powers of the Municipal Board, but that the term "legislative franchise"
in Rep. Act No. 954 refers to a franchise granted solely by Congress.
Further, the government argues that Executive Order No. 392 dated 01 January 1951
transferred even the power to regulate Jai-Alai from the local governments to the
Games and Amusements Board (GAB), a national government agency.
It is worthy of note that neither of the authorities relied upon by ADC to support its
alleged possession of a valid franchise, namely the Charter of the City of Manila (Rep.
Act No. 409) and Manila Ordinance No. 7065 uses the word "franchise". Rep. Act No.
409 empowers the Municipal Board of Manila to "tax, license,
permit and regulatewagers or betting" and to "grant exclusive rights to
establishments", while Ordinance No. 7065 authorized the Manila City Mayor to
"allow and permit" ADC to operate jai-alai facilities in the City of Manila.
It is clear from the foregoing that Congress did not delegate to the City of Manila the
power "to franchise" wagers or betting, including the jai-alai, but retained for itself such
power "to franchise". What Congress delegated to the City of Manila in Rep. Act No.
409, with respect to wagers or betting, was the power to "license, permit, or regulate"
which therefore means that a license or permit issued by the City of Manila to operate
a wager or betting activity, such as the jai-alai where bets are accepted, would not
amount to something meaningful UNLESS the holder of the permit or license was also
FRANCHISED by the national government to so operate. Moreover, even this power
to license, permit, or regulate wagers or betting on jai-alai was removed from local
governments, including the City of Manila, and transferred to the GAB on 1 January
1951 by Executive Order No. 392. The net result is that the authority to grant
franchises for the operation of jai-alai frontons is in Congress, while the regulatory
function is vested in the GAB.
In relation, therefore, to the facts of this case, since ADC has no franchise from
Congress to operate the jai-alai, it may not so operate even if its has a license or
permit from the City Mayor to operate the jai-alai in the City of Manila.
It cannot be overlooked, in this connection, that the Revised Penal Code punishes
gambling and betting under Articles 195 to 199 thereof. Gambling is thus generally
prohibited by law, unless another law is enacted by Congress expressly exempting or
excluding certain forms of gambling from the reach of criminal law. Among these form
the reach of criminal law. Among these forms of gambling allowed by special law are
the horse races authorized by Republic Acts Nos. 309 and 983 and gambling casinos
authorized under Presidential Decree No. 1869.
While jai-alai as a sport is not illegal per se, the accepting of bets or wagers on the
results of jai-alai games is undoubtedly gambling and, therefore, a criminal offense
punishable under Articles 195-199 of the Revised Penal Code, unless it is shown that
a later or special law had been passed allowing it. ADC has not shown any such
special law.
Republic Act No. 409 (the Revised Charter of the City of Manila) which was enacted
by Congress on 18 June 1949 gave the Municipal Board certain delegated legislative
powers under Section 18. A perusal of the powers enumerated under Section 18
shows that these powers are basically regulatory in nature. 5 The regulatory nature of
these powers finds support not only in the plain words of the enumerations under
Section 28 but also in this Court's ruling inPeople v. Vera (65 Phil. 56).
In Vera, this Court declared that a law which gives the Provincial Board the discretion
to determine whether or not a law of general application (such as, the Probation law-
Act No. 4221) would or would not be operative within the province, is unconstitutional
for being an undue delegation of legislative power.
From the ruling in Vera, it would be logical to conclude that, if ADC's arguments were
to prevail, this Court would likewise declare Section 18(jj) of the Revised Charter of
Manila unconstitutional for the power it would delegate to the Municipal Board of
Manila would give the latter the absolute and unlimited discretion to render the penal
code provisions on gambling inapplicable or inoperative to persons or entities issued
permits to operate gambling establishments in the City of Manila.
We need not go to this extent, however, since the rule is that laws must be presumed
valid, constitutional and in harmony with other laws. Thus, the relevant provisions of
Rep. Acts Nos. 409 and 954 and Ordinance No. 7065 should be taken together and it
should then be clear that the legislative powers of the Municipal Board should be
understood to be regulatory in nature and that Republic Act No. 954 should be
understood to refer to congressional franchises, as a necessity for the operation of jai-
alai.
We need not, however, again belabor this issue further since the task at hand which
will ultimately, and with finality, decide the issues in this case is to determine whether
PD No. 771 validly revoked ADC's franchise to operate the jai-alai, assuming (without
conceding) that it indeed possessed such franchise under Ordinance No. 7065.
ADC argues that PD No. 771 is unconstitutional for being violative of the equal
protection and non-impairment provisions of the Constitution. On the other hand, the
government contends that PD No. 771 is a valid exercise of the inherent police power
of the State.
The police power has been described as the least limitable of the inherent powers of
the State. It is based on the ancient doctrine salus populi est suprema lex (the
welfare of the people is the supreme law.) In the early case ofRubi v. Provincial Board
of Mindoro (39 Phil. 660), this Court through Mr. Justice George A. Malcolm stated
thus:
The police power of the State . . . is a power co-extensive with
self-protection, and is not inaptly termed the "law of overruling
necessity." It may be said to be that inherent and plenary power in
the State which enables it to prohibit all things hurtful to the
comfort, safety and welfare of society. Carried onward by the
current of legislation, the judiciary rarely attempts to dam the
onrushing power of legislative discretion, provided the purposes
of the law do not go beyond the great principles that mean
security for the public welfare or do not arbitrarily interfere with the
right of the individual.
In the matter of PD No. 771, the purpose of the law is clearly stated in the "whereas
clause" as follows:
WHEREAS, it has been reported that in spite of the current drive
of our law enforcement agencies against vices and illegal
gambling, these social ills are still prevalent in many areas of the
country;
WHEREAS, there is need to consolidate all the efforts of the
government to eradicate and minimize vices and other forms of
social ills in pursuance of the social and economic development
program under the new society;
WHEREAS, in order to effectively control and regulate wagers or
betting by the public on horse and dog races, jai-alai and other
forms of gambling there is a necessity to transfer the issuance of
permit and/or franchise from local government to the National
Government.
It cannot be argued that the control and regulation of gambling do not promote public
morals and welfare. Gambling is essentially antagonistic and self-reliance. It breeds
indolence and erodes the value of good, honest and hard work. It is, as very aptly
stated by PD No. 771, a vice and a social ill which government must minimize (if not
eradicate) in pursuit of social and economic development.
In Magtajas v. Pryce Properties Corporation (20 July 1994, G.R. No. 111097), this
Court stated thru Mr. Justice Isagani A. Cruz:
In the exercise of its own discretion, the legislative power may
prohibit gambling altogether or allow it without limitation or it may
prohibit some forms of gambling and allow others for whatever
reasons it may consider sufficient. Thus, it has
prohibited jueteng and monte but permits lotteries, cockfighting
and horse-racing. In making such choices, Congress has
consulted its own wisdom, which this Court has no authority to
review, much less reverse. Well has it been said that courts do
not sit to resolve the merits of conflicting theories. That is the
prerogative of the political departments. It is settled that questions
regarding wisdom, morality and practicability of statutes are not
addressed to the judiciary but may be resolved only by the
executive and legislative departments, to which the function
belongs in our scheme of government. (Emphasis supplied)
Talks regarding the supposed vanishing line between right and privilege in American
constitutional law has no relevance in the context of these cases since the reference
there is to economic regulations. On the other hand, jai-alai is not a mere economic
activity which the law seeks to regulate. It is essentially gambling and whether it
should be permitted and, if so, under what conditions are questions primarily for the
lawmaking authority to determine, talking into account national and local interests.
Here, it is the police power of the State that is paramount.
ADC questions the motive for the issuance of PD Nos. 771. Clearly, however, this
Court cannot look into allegations that PD No. 771 was enacted to benefit a select
group which was later given authority to operate the jai-alai under PD No. 810. The
examination of legislative motivation is generally prohibited. (Palmer v. Thompson,
403 U.S. 217, 29 L. Ed. 2d 438 [1971] per Black, J.) There is, the first place, absolute
lack of evidence to support ADC's allegation of improper motivation in the issuance of
PD No. 771. In the second place, as already averred, this Court cannot go behind the
expressed and proclaimed purposes of PD No. 771, which are reasonable and even
laudable.
It should also be remembered that PD No. 771 provides that the national
government can subsequently grant franchises "upon proper application and
verification of the qualifications of the applicant." ADC has not alleged that it filed an
application for a franchise with the national government subsequent to the enactment
of PD No. 771; thus, the allegations abovementioned (of preference to a select group)
are based on conjectures, speculations and imagined biases which do not warrant the
consideration of this Court.
On the other hand, it is noteworthy that while then president Aquino issued Executive
Order No. 169 revoking PD No. 810 (which granted a franchise to a Marcos-crony to
operate the jai-alai), she did not scrap or repeal PD No. 771 which had revoked all
franchises to operate jai-alais issued by local governments, thereby re-affirming the
government policy that franchises to operate jai-alais are for the national government
(not local governments) to consider and approve.
On the alleged violation of the non-impairment and equal protection clauses of the
Constitution, it should be remembered that a franchise is not in the strict sense a
simple contract but rather it is more importantly, a mere privilege specially in matters
which are within the government's power to regulate and even prohibit through the
exercise of the police power. Thus, a gambling franchise is always subject to the
exercise of police power for the public welfare.
In RCPI v. NTC (150 SCRA 450), we held that:
A franchise started out as a "royal privilege or (a) branch of the
King's prerogative, subsisting in the hands of a subject." This
definition was given by Finch, adopted by Blackstone, and
accepted by every authority since . . . Today, a franchise being
merely a privilege emanating from the sovereign power of the
state and owing its existence to a grant, is subject to regulation by
the state itself by virtue of its police power through its
administrative agencies.
There is a stronger reason for holding ADC's permit to be a mere privilege because
jai-alai, when played for bets, is pure and simple gambling. To analogize a gambling
franchise for the operation of a public utility, such as public transportation company, is
to trivialize the great historic origin of this branch of royal privilege.
As earlier noted, ADC has not alleged ever applying for a franchise under the
provisions of PD No. 771. and yet, the purpose of PD No. 771 is quite clear from its
provisions, i.e., to give to the national government the exclusive power to grant
gambling franchises. Thus, all franchises then existing were revoked but were made
subject to reissuance by the national government upon compliance by the applicant
with government-set qualifications and requirements.
There was no violation by PD No. 771 of the equal protection clause since the decree
revoked all franchises issued by local governments without qualification or exception.
ADC cannot allege violation of the equal protection clause simply because it was the
only one affected by the decree, for as correctly pointed out by the government, ADC
was not singled out when all jai-alai franchises were revoked. Besides, it is too late in
the day for ADC to seek redress for alleged violation of its constitutional rights for it
could have raised these issues as early as 1975, almost twenty 920) years ago.
Finally, we do not agree that Section 3 of PD No. 771 and the requirement of a
legislative franchise in Republic Act No. 954 are "riders" to the two 92) laws and are
violative of the rule that laws should embrace one subject which shall be expressed in
the title, as argued by ADC. In Cordero v. Cabatuando (6 SCRA 418), this Court ruled
that the requirement under the constitution that all laws should embrace only one
subject which shall be expressed in the title is sufficiently met if the title is
comprehensive enough reasonably to include the general object which the statute
seeks to effect, without expressing each and every end and means necessary or
convenient for the accomplishing of the objective.
III
On the issue of whether or not there was grave abuse of discretion committed by
respondent Judge Reyes in issuing the temporary restraining order (later converted to
a writ of preliminary injunction) and the writ of preliminarymandatory injunction, we
hold and rule there was.
Section 3, Rule 58 of the rules of Court provides for the grounds for the issuance of a
preliminary injunction. While ADC could allege these grounds, respondent judge
should have taken judicial notice of Republic Act No. 954 and PD 771, under Section
1 rule 129 of the Rules of court. These laws negate the existence of any legal right on
the part of ADC to the reliefs it sought so as to justify the issuance of a writ of
preliminary injunction. since PD No. 771 and Republic Act No. 954 are presumed valid
and constitutional until ruled otherwise by the Supreme Court after due hearing, ADC
was not entitled to the writs issued and consequently there was grave abuse of
discretion in issuing them.
WHEREFORE, for the foregoing reasons, judgment is hereby rendered:
1. allowing the Republic of the Philippines to intervene in G.R. No.
115044.
2. declaring Presidential Decree No. 771 valid and constitutional.
3. declaring that respondent Associated Development corporation
(ADC) does not possess the required congressional franchise to
operate and conduct the jai-alai under Republic Act No. 954 and
Presidential Decree No. 771.
4. setting aside the writs of preliminary injunction and preliminary
mandatory injunction issued by respondent Judge Vetino Reyes
in civil Case No. 94-71656.
SO ORDERED.
EN BANC
G.R. No. L-42571-72 July 25, 1983
VICENTE DE LA CRUZ, RENATO ALIPIO, JOSE TORRES III, LEONCIO CORPUZ,
TERESITA CALOT, ROSALIA FERNANDEZ, ELIZABETH VELASCO, NANETTE
VILLANUEVA, HONORATO BUENAVENTURA, RUBEN DE CASTRO, VICENTE
ROXAS, RICARDO DAMIAN, DOMDINO ROMDINA, ANGELINA OBLIGACION,
CONRADO GREGORIO, TEODORO REYES, LYDIA ATRACTIVO, NAPOLEON
MENDOZA, PERFECTO GUMATAY, ANDRES SABANGAN, ROSITA DURAN,
SOCORRO BERNARDEZ, and PEDRO GABRIEL,petitioners,
vs.
THE HONORABLE EDGARDO L. PARAS, MATIAS RAMIREZ as the Municipal
Mayor, MARIO MENDOZA as the Municipal Vice-Mayor, and THE MUNICIPAL
COUNCIL OF BOCAUE, BULACAN, respondents.
FERNANDO, C.J.:
The crucial question posed by this certiorari proceeding is whether or not a municipal
corporation, Bocaue, Bulacan, represented by respondents, 1 can, prohibit the
exercise of a lawful trade, the operation of night clubs, and the pursuit of a lawful
occupation, such clubs employing hostesses. It is contended that the ordinance
assailed as invalid is tainted with nullity, the municipality being devoid of power to
prohibit a lawful business, occupation or calling, petitioners at the same time alleging
that their rights to due process and equal protection of the laws were violated as the
licenses previously given to them was in effect withdrawn without judicial hearing. 2
The assailed ordinance 3 is worded as follows: "Section 1. Title of Ordinance. This
Ordinance shall be known and may be cited as the [Prohibition and Closure
Ordinance] of Bocaue, Bulacan. Section 2. Definitions of Terms (a) 'Night Club'
shall include any place or establishment selling to the public food or drinks where
customers are allowed to dance. (b) 'Cabaret' or 'Dance Hall' shall include any place
or establishment where dancing is permitted to the public and where professional
hostesses or hospitality girls and professional dancers are employed. (c) 'Professional
hostesses' or 'hospitality girls' shall include any woman employed by any of the
establishments herein defined to entertain guests and customers at their table or to
dance with them. (d) 'Professional dancer' shall include any woman who dances at
any of the establishments herein defined for a fee or remuneration paid directly or
indirectly by the operator or by the persons she dances with. (e) 'Operator' shall
include the owner, manager, administrator or any person who operates and is
responsible for the operation of any night club, cabaret or dance hall. Section 3.
Prohibition in the Issuance and Renewal of Licenses, Permits. Being the principal
cause in the decadence of morality and because of their other adverse effects on this
community as explained above, no operator of night clubs, cabarets or dance halls
shall henceforth be issued permits/licenses to operate within the jurisdiction of the
municipality and no license/permit shall be issued to any professional hostess,
hospitality girls and professional dancer for employment in any of the aforementioned
establishments. The prohibition in the issuance of licenses/permits to said persons
and operators of said establishments shall include prohibition in the renewal thereof.
Section 4. Revocation of Permits and Licenses. The licenses and permits issued
to operators of night clubs, cabarets or dance halls which are now in operation
including permits issued to professional hostesses, hospitality girls and professional
dancers are hereby revoked upon the expiration of the thirty-day period given them as
provided in Section 8 hereof and thenceforth, the operation of these establishments
within the jurisdiction of the municipality shall be illegal. Section 5. Penalty in case of
violation. Violation of any of the provisions of this Ordinance shall be punishable by
imprisonment not exceeding three (3) months or a fine not exceeding P200.00 or both
at the discretion of the Court. If the offense is committed by a juridical entity, the
person charged with the management and/or operation thereof shall be liable for the
penalty provided herein. Section 6. Separability Clause. If, for any reason, any
section or provision of this Ordinance is held unconstitutional or invalid, no other
section or provision hereof shall be affected thereby. Section 7. Repealing
Clause. All ordinance, resolutions, circulars, memoranda or parts thereof that are
inconsistent with the provisions of this Ordinance are hereby repealed. Section 8.
Effectivity. This Ordinance shall take effect immediately upon its approval;
provided, however, that operators of night clubs, cabarets and dance halls now in
operation including professional hostesses, hospitality girls and professional dancers
are given a period of thirty days from the approval hereof within which to wind up their
businesses and comply with the provisions of this Ordinance." 4
On November 5, 1975, two cases for prohibition with preliminary injunction were filed
with the Court of First Instance of Bulacan. 5 The grounds alleged follow:
1. Ordinance No. 84 is null and void as a municipality has no authority to prohibit a
lawful business, occupation or calling.
2. Ordinance No. 84 is violative of the petitioners' right to due process and the equal
protection of the law, as the license previously given to petitioners was in effect
withdrawn without judicial hearing. 3. That under Presidential Decree No. 189, as
amended, by Presidential Decree No. 259, the power to license and regulate tourist-
oriented businesses including night clubs, has been transferred to the Department of
Tourism." 6 The cases were assigned to respondent Judge, now Associate Justice
Paras of the Intermediate Appellate Court, who issued a restraining order on
November 7, 1975. The answers were thereafter filed. It was therein alleged: " 1. That
the Municipal Council is authorized by law not only to regulate but to prohibit the
establishment, maintenance and operation of night clubs invoking Section 2243 of the
RAC, CA 601, Republic Acts Nos. 938, 978 and 1224. 2. The Ordinance No. 84 is not
violative of petitioners' right to due process and the equal protection of the law, since
property rights are subordinate to public interests. 3. That Presidential Decree No.
189, as amended, did not deprive Municipal Councils of their jurisdiction to regulate or
prohibit night clubs." 7There was the admission of the following facts as having been
established: "l. That petitioners Vicente de la Cruz, et al. in Civil Case No. 4755-M had
been previously issued licenses by the Municipal Mayor of Bocaue-petitioner Jose
Torres III, since 1958; petitioner Vicente de la Cruz, since 1960; petitioner Renato
Alipio, since 1961 and petitioner Leoncio Corpuz, since 1972; 2. That petitioners had
invested large sums of money in their businesses; 3. That the night clubs are well-
lighted and have no partitions, the tables being near each other; 4. That the petitioners
owners/operators of these clubs do not allow the hospitality girls therein to engage in
immoral acts and to go out with customers; 5. That these hospitality girls are made to
go through periodic medical check-ups and not one of them is suffering from any
venereal disease and that those who fail to submit to a medical check-up or those who
are found to be infected with venereal disease are not allowed to work; 6. That the
crime rate there is better than in other parts of Bocaue or in other towns of
Bulacan." 8 Then came on January 15, 1976 the decision upholding the
constitutionality and validity of Ordinance No. 84 and dismissing the cases. Hence this
petition for certiorari by way of appeal.
In an exhaustive as well as scholarly opinion, the lower court dismissed the petitions.
Its rationale is set forth in the opening paragraph thus: "Those who lust cannot last.
This in essence is why the Municipality of Bocaue, Province of Bulacan, stigmatized
as it has been by innuendos of sexual titillation and fearful of what the awesome future
holds for it, had no alternative except to order thru its legislative machinery, and even
at the risk of partial economic dislocation, the closure of its night clubs and/or
cabarets. This in essence is also why this Court, obedient to the mandates of good
government, and cognizant of the categorical imperatives of the current legal and
social revolution, hereby [upholds] in the name of police power the validity and
constitutionality of Ordinance No. 84, Series of 1975, of the Municipal Council of
Bocaue, Bulacan. The restraining orders heretofore issued in these two cases are
therefore hereby rifted, effective the first day of February, 1976, the purpose of the
grace period being to enable the petitioners herein to apply to the proper appellate
tribunals for any contemplated redress." 9 This Court is, however, unable to agree with
such a conclusion and for reasons herein set forth, holds that reliance on the police
power is insufficient to justify the enactment of the assailed ordinance. It must be
declared null and void.
1. Police power is granted to municipal corporations in general terms as
follows: "General power of council to enact ordinances and make regulations. - The
municipal council shall enact such ordinances and make such regulations, not
repugnant to law, as may be necessary to carry into effect and discharge the powers
and duties conferred upon it by law and such as shall seem necessary and proper to
provide for the health and safety, promote the prosperity, improve the morals, peace,
good order, comfort, and convenience of the municipality and the inhabitants thereof,
and for the protection of property therein." 10 It is practically a reproduction of the
former Section 39 of Municipal Code. 11An ordinance enacted by virtue thereof,
according to Justice Moreland, speaking for the Court in the leading case of United
States v. Abendan 12 "is valid, unless it contravenes the fundamental law of the
Philippine Islands, or an Act of the Philippine Legislature, or unless it is against public
policy, or is unreasonable, oppressive, partial, discriminating, or in derogation of
common right. Where the power to legislate upon a given subject, and the mode of its
exercise and the details of such legislation are not prescribed, the ordinance passed
pursuant thereto must be a reasonable exercise of the power, or it will be pronounced
invalid." 13 In another leading case, United States v. Salaveria, 14 the ponente this time
being Justice Malcolm, where the present Administrative Code provision was applied,
it was stated by this Court: "The general welfare clause has two branches: One
branch attaches itself to the main trunk of municipal authority, and relates to such
ordinances and regulations as may be necessary to carry into effect and discharge the
powers and duties conferred upon the municipal council by law. With this class we are
not here directly concerned. The second branch of the clause is much more
independent of the specific functions of the council which are enumerated by law. It
authorizes such ordinances as shall seem necessary and proper to provide for the
health and safety, promote the prosperity, improve the morals, peace, good order,
comfort, and convenience of the municipality and the inhabitants thereof, and for the
protection of property therein.' It is a general rule that ordinances passed by virtue of
the implied power found in the general welfare clause must be reasonable, consonant
with the general powersand purposes of the corporation, and not inconsistent with the
laws or policy of the State." 15 If night clubs were merely then regulated and not
prohibited, certainly the assailed ordinance would pass the test of validity. In the two
leading cases above set forth, this Court had stressed reasonableness, consonant
with the general powers and purposes of municipal corporations, as well as
consistency with the laws or policy of the State. It cannot be said that such a sweeping
exercise of a lawmaking power by Bocaue could qualify under the term reasonable.
The objective of fostering public morals, a worthy and desirable end can be attained
by a measure that does not encompass too wide a field. Certainly the ordinance on its
face is characterized by overbreadth. The purpose sought to be achieved could have
been attained by reasonable restrictions rather than by an absolute prohibition. The
admonition in Salaveria should be heeded: "The Judiciary should not lightly set aside
legislative action when there is not a clear invasion of personal or property rights
under the guise of police regulation." 16 It is clear that in the guise of a police
regulation, there was in this instance a clear invasion of personal or property rights,
personal in the case of those individuals desirous of patronizing those night clubs and
property in terms of the investments made and salaries to be earned by those therein
employed.
2. The decision now under review refers to Republic Act No. 938 as amended. 17 It
was originally enacted on June 20, 1953. It is entitled: "AN ACT GRANTING
MUNICIPAL OR CITY BOARDS AND COUNCILS THE POWER TO REGULATE THE
ESTABLISHMENT, MAINTENANCE AND OPERATION OF CERTAIN PLACES OF
AMUSEMENT WITHIN THEIR RESPECTIVE TERRITORIAL JURISDICTIONS.' 18 Its
first section insofar as pertinent reads: "The municipal or city board or council of each
chartered city shall have the power to regulate by ordinance the establishment,
maintenance and operation of night clubs, cabarets, dancing schools, pavilions,
cockpits, bars, saloons, bowling alleys, billiard pools, and other similar places of
amusement within its territorial jurisdiction: ... " 19 Then on May 21, 1954, the first
section was amended to include not merely "the power to regulate, but likewise
"Prohibit ... " 20 The title, however, remained the same. It is worded exactly as
Republic Act No. 938. It is to be admitted that as thus amended, if only the above
portion of the Act were considered, a municipal council may go as far as to prohibit the
operation of night clubs. If that were all, then the appealed decision is not devoid of
support in law. That is not all, however. The title was not in any way altered. It was not
changed one whit. The exact wording was followed. The power granted remains that
of regulation, not prohibition. There is thus support for the view advanced by
petitioners that to construe Republic Act No. 938 as allowing the prohibition of the
operation of night clubs would give rise to a constitutional question. The Constitution
mandates: "Every bill shall embrace only one subject which shall be expressed in the
title thereof. " 21 Since there is no dispute as the title limits the power to regulating, not
prohibiting, it would result in the statute being invalid if, as was done by the
Municipality of Bocaue, the operation of a night club was prohibited. There is a wide
gap between the exercise of a regulatory power "to provide for the health and safety,
promote the prosperity, improve the morals, 22 in the language of the Administrative
Code, such competence extending to all "the great public needs, 23 to quote from
Holmes, and to interdict any calling, occupation, or enterprise. In accordance with the
well-settled principle of constitutional construction that between two possible
interpretations by one of which it will be free from constitutional infirmity and by the
other tainted by such grave defect, the former is to be preferred. A construction that
would save rather than one that would affix the seal of doom certainly commends
itself. We have done so before We do so again.24
3. There is reinforcement to the conclusion reached by virtue of a specific provision of
the recently-enacted Local Government Code. 25 The general welfare clause, a
reiteration of the Administrative Code provision, is set forth in the first paragraph of
Section 149 defining the powers and duties of the sangguniang bayan. It read as
follows: "(a) Enact such ordinances and issue such regulations as may be necessary
to carry out and discharge the responsibilities conferred upon it by law, and such as
shall be necessary and proper to provide for the health, safety, comfort and
convenience, maintain peace and order, improve public morals, promote the
prosperity and general welfare of the municipality and the inhabitants thereof, and
insure the protection of property therein; ..." 26 There are in addition provisions that
may have a bearing on the question now before this Court. Thus the sangguniang
bayan shall "(rr) Regulate cafes, restaurants, beer-houses, hotels, motels, inns,
pension houses and lodging houses, except travel agencies, tourist guides, tourist
transports, hotels, resorts, de luxe restaurants, and tourist inns of international
standards which shall remain under the licensing and regulatory power of the Ministry
of Tourism which shall exercise such authority without infringing on the taxing or
regulatory powers of the municipality; (ss) Regulate public dancing schools, public
dance halls, and sauna baths or massage parlors; (tt) Regulate the establishment and
operation of billiard pools, theatrical performances, circuses and other forms of
entertainment; ..." 27 It is clear that municipal corporations cannot prohibit the
operation of night clubs. They may be regulated, but not prevented from carrying on
their business. It would be, therefore, an exercise in futility if the decision under review
were sustained. All that petitioners would have to do is to apply once more for licenses
to operate night clubs. A refusal to grant licenses, because no such businesses could
legally open, would be subject to judicial correction. That is to comply with the
legislative will to allow the operation and continued existence of night clubs subject to
appropriate regulations. In the meanwhile, to compel petitioners to close their
establishments, the necessary result of an affirmance, would amount to no more than
a temporary termination of their business. During such time, their employees would
undergo a period of deprivation. Certainly, if such an undesirable outcome can be
avoided, it should be. The law should not be susceptible to the reproach that it
displays less than sympathetic concern for the plight of those who, under a mistaken
appreciation of a municipal power, were thus left without employment. Such a
deplorable consequence is to be avoided. If it were not thus, then the element of
arbitrariness enters the picture. That is to pay less, very much less, than full deference
to the due process clause with its mandate of fairness and reasonableness.
4. The conclusion reached by this Court is not to be interpreted as a retreat from its
resolute stand sustaining police power legislation to promote public morals. The
commitment to such an Ideal forbids such a backward step. Legislation of that
character is deserving of the fullest sympathy from the judiciary. Accordingly, the
judiciary has not been hesitant to lend the weight of its support to measures that can
be characterized as falling within that aspect of the police power. Reference is made
by respondents to Ermita-Malate Hotel and Motel Operators Association, Inc. v. City
Mayor of Manila. 28 There is a misapprehension as to what was decided by this Court.
That was a regulatory measure. Necessarily, there was no valid objection on due
process or equal protection grounds. It did not prohibit motels. It merely regulated the
mode in which it may conduct business in order precisely to put an end to practices
which could encourage vice and immorality. This is an entirely different case. What
was involved is a measure not embraced within the regulatory power but an exercise
of an assumed power to prohibit. Moreover, while it was pointed out in the aforesaid
Ermita-Malate Hotel and Motel Operators Association, Inc. decision that there must be
a factual foundation of invalidity, it was likewise made clear that there is no need to
satisfy such a requirement if a statute were void on its face. That it certainly is if the
power to enact such ordinance is at the most dubious and under the present Local
Government Code non-existent.
WHEREFORE, the writ of certiorari is granted and the decision of the lower court
dated January 15, 1976 reversed, set aside, and nullied. Ordinance No. 84, Series of
1975 of the Municipality of Bocaue is declared void and unconstitutional. The
temporary restraining order issued by this Court is hereby made permanent. No costs.
EN BANC
G.R. No. L-24670 December 14, 1979
ORTIGAS & CO., LIMITED PARTNERSHIP, plaintiff-appellant,
vs.
FEATI BANK AND TRUST CO., defendant-appellee.
SANTOS, J.:
An appeal interposed on June 23, 1965 by plaintiff-appellant, Ortigas & Co., Limited
Partnership, from the decision of the Court of First Instance of Rizal, Branch VI, at
Pasig, Hon. Andres Reyes presiding, which dismissed its complaint in Civil Case No.
7706, entitled, "Ortigas & Company, Limited Partnership, plaintiff, v. Feati Bank and
Trust Company, defendant," for lack of merit.
The following facts a reproduction of the lower court's findings, which, in turn, are
based on a stipulation of facts entered into by the parties are not disputed. Plaintiff
(formerly known as "Ortigas, Madrigal y Cia") is a limited partnership and defendant
Feati Bank and Trust Co., is a corporation duly organized and existing in accordance
with the laws of the Philippines. Plaintiff is engaged in real estate business, developing
and selling lots to the public, particularly the Highway Hills Subdivision along Epifanio
de los Santos Avenue, Mandaluyong, Rizal. 1
On March 4, 1952, plaintiff, as vendor, and Augusto Padilla y Angeles and Natividad
Angeles, as vendees, entered into separate agreements of sale on installments over
two parcels of land, known as Lots Nos. 5 and 6, Block 31, of the Highway Hills
Subdivision, situated at Mandaluyong, Rizal. On July 19, 1962, the said vendees
transferred their rights and interests over the aforesaid lots in favor of one Emma
Chavez. Upon completion of payment of the purchase price, the plaintiff executed the
corresponding deeds of sale in favor of Emma Chavez. Both the agreements (of sale
on installment) and the deeds of sale contained the stipulations or restrictions that:
1. The parcel of land subject of this deed of sale shall be used the
Buyer exclusively for residential purposes, and she shall not be
entitled to take or remove soil, stones or gravel from it or any
other lots belonging to the Seller.
2. All buildings and other improvements (except the fence) which
may be constructed at any time in said lot must be, (a) of strong
materials and properly painted, (b) provided with modern sanitary
installations connected either to the public sewer or to an
approved septic tank, and (c) shall not be at a distance of less
than two (2) meters from its boundary lines. 2
The above restrictions were later annotated in TCT Nos. 101509 and 101511 of the
Register of Deeds of Rizal, covering the said lots and issued in the name of Emma
Chavez. 3
Eventually, defendant-appellee acquired Lots Nos. 5 and 6, with TCT Nos. 101613
and 106092 issued in its name, respectively and the building restrictions were also
annotated therein. 4 Defendant-appellee bought Lot No. 5 directly from Emma Chavez,
"free from all liens and encumbrances as stated in Annex 'D', 5 while Lot No. 6 was
acquired from Republic Flour Mills through a "Deed of Exchange," Annex "E". 6 TCT
No. 101719 in the name of Republic Flour Mills likewise contained the same
restrictions, although defendant-appellee claims that Republic Flour Mills purchased
the said Lot No. 6 "in good faith. free from all liens and encumbrances," as stated in
the Deed of Sale, Annex "F" 7 between it and Emma Chavez.
Plaintiff-appellant claims that the restrictions annotated on TCT Nos. 101509, 101511,
101719, 101613, and 106092 were imposed as part of its general building scheme
designed for the beautification and development of the Highway Hills Subdivision
which forms part of the big landed estate of plaintiff-appellant where commercial and
industrial sites are also designated or established. 8
Defendant-appellee, upon the other hand, maintains that the area along the western
part of Epifanio de los Santos Avenue (EDSA) from Shaw Boulevard to Pasig River,
has been declared a commercial and industrial zone, per Resolution No. 27, dated
February 4, 1960 of the Municipal Council of Mandaluyong, Rizal. 9 It alleges that
plaintiff-appellant 'completely sold and transferred to third persons all lots in said
subdivision facing Epifanio de los Santos Avenue"10 and the subject lots thereunder
were acquired by it "only on July 23, 1962 or more than two (2) years after the area ...
had been declared a commercial and industrial zone ... 11
On or about May 5, 1963, defendant-appellee began laying the foundation and
commenced the construction of a building on Lots Nos. 5 and 6, to be devoted to
banking purposes, but which defendant-appellee claims could also be devoted to, and
used exclusively for, residential purposes. The following day, plaintiff-appellant
demanded in writing that defendant-appellee stop the construction of the commerical
building on the said lots. The latter refused to comply with the demand, contending
that the building was being constructed in accordance with the zoning regulations,
defendant-appellee having filed building and planning permit applications with the
Municipality of Mandaluyong, and it had accordingly obtained building and planning
permits to proceed with the construction. 12
On the basis of the foregoing facts, Civil Case No. 7706, supra, was submitted in the
lower court for decision. The complaint sought, among other things, the issuance of "a
writ of preliminary injunction ... restraining and enjoining defendant, its agents,
assigns, and those acting on its or their behalf from continuing or completing the
construction of a commercial bank building in the premises ... involved, with the view
to commanding the defendant to observe and comply with the building restrictions
annotated in the defendant's transfer certificate of title."
In deciding the said case, the trial court considered, as the fundamental issue,
whether or not the resolution of the Municipal Council of Mandaluyong declaring Lots
Nos. 5 and 6, among others, as part of the commercial and industrial zone of the
municipality, prevailed over the building restrictions imposed by plaintiff-appellant on
the lots in question. 13 The records do not show that a writ of preliminary injunction
was issued.
The trial court upheld the defendant-appellee and dismissed the complaint, holding
that the subject restrictions were subordinate to Municipal Resolution No. 27, supra. It
predicated its conclusion on the exercise of police power of the said municipality, and
stressed that private interest should "bow down to general interest and welfare. " In
short, it upheld the classification by the Municipal Council of the area along Epifanio
de los Santos Avenue as a commercial and industrial zone, and held that the same
rendered "ineffective and unenforceable" the restrictions in question as against
defendant-appellee. 14 The trial court decision further emphasized that it "assumes
said resolution to be valid, considering that there is no issue raised by either of the
parties as to whether the same is null and void. 15
On March 2, 1965, plaintiff-appellant filed a motion for reconsideration of the above
decision, 16 which motion was opposed by defendant-appellee on March 17, 1965. 17 It
averred, among others, in the motion for reconsideration that defendant- appellee
"was duty bound to comply with the conditions of the contract of sale in its favor, which
conditions were duly annotated in the Transfer Certificates of Title issued in her
(Emma Chavez) favor." It also invited the trial court's attention to its claim that the
Municipal Council had (no) power to nullify the contractual obligations assumed by the
defendant corporation." 18
19
The trial court denied the motion for reconsideration in its order of March 26, 1965.
On April 2, 1965 plaintiff-appellant filed its notice of appeal from the decision
dismissing the complaint and from the order of March 26, 1965 denying the motion for
reconsideration, its record on appeal, and a cash appeal bond." 20On April 14, the
appeal was given due course 21 and the records of the case were elevated directly to
this Court, since only questions of law are raised. 22
Plaintiff-appellant alleges in its brief that the trial court erred
I. When it sustained the view that Resolution No. 27, series of
1960 of the Municipal Council of Mandaluyong, Rizal declaring
Lots Nos. 5 and 6, among others, as part of the commercial and
industrial zone, is valid because it did so in the exercise of its
police power; and
II. When it failed to consider whether or not the Municipal Council
had the power to nullify the contractual obligations assumed by
defendant-appellee and when it did not make a finding that the
building was erected along the property line, when it should have
been erected two meters away from said property line. 23
The defendant-appellee submitted its counter-assignment of errors. In this connection,
We already had occasion to hold in Relativo v. Castro 24 that "(I)t is not incumbent on
the appellee, who occupies a purely defensive position, and is seeking no affirmative
relief, to make assignments of error, "
The only issues to be resolved, therefore, are: (1) whether Resolution No. 27 s-1960 is
a valid exercise of police power; and (2) whether the said Resolution can nullify or
supersede the contractual obligations assumed by defendant-appellee.
1. The contention that the trial court erred in sustaining the validity of Resolution No.
27 as an exercise of police power is without merit. In the first place, the validity of the
said resolution was never questioned before it. The rule is that the question of law or
of fact which may be included in the appellant's assignment of errors must be those
which have been raised in the court below, and are within the issues framed by the
parties. 25 The object of requiring the parties to present all questions and issues to the
lower court before they can be presented to the appellate court is to enable the lower
court to pass thereon, so that the appellate court upon appeal may determine whether
or not such ruling was erroneous. The requirement is in furtherance of justice in that
the other party may not be taken by surprise. 26 The rule against the practice of
blowing "hot and cold" by assuming one position in the trial court and another on
appeal will, in the words of Elliot, prevent deception. 27 For it is well-settled that issues
or defenses not raised 28 or properly litigated 29 or pleaded 30 in the Court below cannot
be raised or entertained on appeal.
In this particular case, the validity of the resolution was admitted at least impliedly, in
the stipulation of facts below. when plaintiff-appellant did not dispute the same. The
only controversy then as stated by the trial court was whether or not the resolution of
the Municipal Council of Mandaluyong ... which declared lots Nos. 4 and 5 among
others, as a part of the commercial and industrial zone of the municipality, prevails
over the restrictions constituting as encumbrances on the lots in question. 31 Having
admitted the validity of the subject resolution below, even if impliedly, plaintiff-
appellant cannot now change its position on appeal.
But, assuming arguendo that it is not yet too late in the day for plaintiff-appellant to
raise the issue of the invalidity of the municipal resolution in question, We are of the
opinion that its posture is unsustainable. Section 3 of R.A. No. 2264, otherwise known
as the Local Autonomy Act," 32 empowers a Municipal Council "to adopt zoning and
subdivision ordinances or regulations"; 33 for the municipality. Clearly, the law does not
restrict the exercise of the power through an ordinance. Therefore, granting that
Resolution No. 27 is not an ordinance, it certainly is a regulatory measure within the
intendment or ambit of the word "regulation" under the provision. As a matter of fact
the same section declares that the power exists "(A)ny provision of law to the contrary
notwithstanding ... "
An examination of Section 12 of the same law 34 which prescribes the rules for its
interpretation likewise reveals that the implied power of a municipality should be
"liberally construed in its favor" and that "(A)ny fair and reasonable doubt as to the
existence of the power should be interpreted in favor of the local government and it
shall be presumed to exist." The same section further mandates that the general
welfare clause be liberally interpreted in case of doubt, so as to give more power to
local governments in promoting the economic conditions, social welfare and material
progress of the people in the community. The only exceptions under Section 12 are
existing vested rights arising out of a contract between "a province, city or municipality
on one hand and a third party on the other," in which case the original terms and
provisions of the contract should govern. The exceptions, clearly, do not apply in the
case at bar.
2. With regard to the contention that said resolution cannot nullify the contractual
obligations assumed by the defendant-appellee referring to the restrictions
incorporated in the deeds of sale and later in the corresponding Transfer Certificates
of Title issued to defendant-appellee it should be stressed, that while non-
impairment of contracts is constitutionally guaranteed, the rule is not absolute, since it
has to be reconciled with the legitimate exercise of police power, i.e., "the power to
prescribe regulations to promote the health, morals, peace, education, good order or
safety and general welfare of the people. 35 Invariably described as "the most
essential, insistent, and illimitable of powers" 36 and "in a sense, the greatest and most
powerful attribute of government, 37 the exercise of the power may be judicially
inquired into and corrected only if it is capricious, 'whimsical, unjust or unreasonable,
there having been a denial of due process or a violation of any other applicable
constitutional guarantee. 38 As this Court held through Justice Jose P. Bengzon
in Philippine Long Distance Company vs. City of Davao, et al. 39 police power "is
elastic and must be responsive to various social conditions; it is not, confined within
narrow circumscriptions of precedents resting on past conditions; it must follow the
legal progress of a democratic way of life." We were even more emphatic in Vda. de
Genuino vs. The Court of Agrarian Relations, et al., 40 when We declared: "We do not
see why public welfare when clashing with the individual right to property should not
be made to prevail through the state's exercise of its police power.
Resolution No. 27, s-1960 declaring the western part of highway 54, now E. de los
Santos Avenue (EDSA, for short) from Shaw Boulevard to the Pasig River as an
industrial and commercial zone, was obviously passed by the Municipal Council of
Mandaluyong, Rizal in the exercise of police power to safeguard or promote the
health, safety, peace, good order and general welfare of the people in the locality,
Judicial notice may be taken of the conditions prevailing in the area, especially where
lots Nos. 5 and 6 are located. The lots themselves not only front the highway;
industrial and commercial complexes have flourished about the place. EDSA, a main
traffic artery which runs through several cities and municipalities in the Metro Manila
area, supports an endless stream of traffic and the resulting activity, noise and
pollution are hardly conducive to the health, safety or welfare of the residents in its
route. Having been expressly granted the power to adopt zoning and subdivision
ordinances or regulations, the municipality of Mandaluyong, through its Municipal
'council, was reasonably, if not perfectly, justified under the circumstances, in passing
the subject resolution.
The scope of police power keeps expanding as civilization advances, stressed this
Court, speaking thru Justice Laurel in the leading case of Calalang v. Williams et
al., 41 Thus-
As was said in the case of Dobbins v. Los Angeles (195 US 223,
238 49 L. ed. 169), 'the right to exercise the police power is a
continuing one, and a business lawful today may in the future,
because of changed situation, the growth of population or other
causes, become a menace to the public health and welfare, and
be required to yield to the public good.' And in People v. Pomar
(46 Phil. 440), it was observed that 'advancing civilization is
bringing within the scope of police power of the state today things
which were not thought of as being with in such power
yesterday. The development of civilization), the rapidly increasing
population, the growth of public opinion, with an increasing desire
on the part of the masses and of the government to look after and
care for the interests of the individuals of the state, have brought
within the police power many questions for regulation which
formerly were not so considered. 42 (Emphasis, supplied.)
Thus, the state, in order to promote the general welfare, may interfere with personal
liberty, with property, and with business and occupations. Persons may be subjected
to all kinds of restraints and burdens, in order to secure the general comfort health and
prosperity of the state 43 and to this fundamental aim of our Government, the rights of
the individual are subordinated. 44
The need for reconciling the non-impairment clause of the Constitution and the valid
exercise of police power may also be gleaned from Helvering v. Davis 45 wherein Mr.
Justice Cardozo, speaking for the Court, resolved the conflict "between one welfare
and another, between particular and general, thus
Nor is the concept of the general welfare static. Needs that were
narrow or parochial a century ago may be interwoven in our day
with the well-being of the nation What is critical or urgent changes
with the times. 46
The motives behind the passage of the questioned resolution being reasonable, and it
being a " legitimate response to a felt public need," 47 not whimsical or oppressive, the
non-impairment of contracts clause of the Constitution will not bar the municipality's
proper exercise of the power. Now Chief Justice Fernando puts it aptly when he
declared: "Police power legislation then is not likely to succumb to the challenge that
thereby contractual rights are rendered nugatory." 48
Furthermore, We restated in Philippine American Life Ins. Co. v. Auditor
General 49 that laws and reservation of essential attributes of sovereign power are
read into contracts agreed upon by the parties. Thus
Not only are existing laws read into contracts in order to fix
obligations as between the parties, but the reservation of
essential attributes of sovereign power is also read into contracts
as a postulate of the legal order. The policy of protecting contracts
against impairments presupposes the maintenance of a
government by virtue of which contractual relations are worthwhile
a government which retains adequate authority to secure the
peace and good order of society.
Again, We held in Liberation Steamship Co., Inc. v. Court of Industrial
Relations, 50 through Justice J.B.L. Reyes, that ... the law forms part of, and is read
into, every contract, unless clearly excluded therefrom in those cases where such
exclusion is allowed." The decision in Maritime Company of the Philippines v.
Reparations Commission, 51 written for the Court by Justice Fernando, now Chief
Justice, restates the rule.
One last observation. Appellant has placed unqualified reliance on American
jurisprudence and authorities 52 to bolster its theory that the municipal resolution in
question cannot nullify or supersede the agreement of the parties embodied in the
sales contract, as that, it claims, would impair the obligation of contracts in violation of
the Constitution. Such reliance is misplaced.
In the first place, the views set forth in American decisions and authorities are not per
se controlling in the Philippines, the laws of which must necessarily be construed in
accordance with the intention of its own lawmakers and such intent may be deduced
from the language of each law and the context of other local legislation related
thereto. 53 and Burgess, et al v. Magarian, et al., 55 two Of the cases cited by plaintiff-
appellant, lend support to the conclusion reached by the trial court, i.e. that the
municipal resolution supersedes/supervenes over the contractual undertaking
between the parties. Dolan v. Brown, states that "Equity will not, as a rule, enforce a
restriction upon the use of property by injunction where the property has so changed
in character and environment as to make it unfit or unprofitable for use should the
restriction be enforced, but will, in such a case, leave the complainant to whatever
remedy he may have at law. 56 (Emphasis supplied.) Hence, the remedy of injunction
in Dolan vs. Brown was denied on the specific holding that "A grantor may lawfully
insert in his deed conditions or restrictions which are not against public policy and do
not materially impair the beneficial enjoyment of the estate. 57 Applying the principle
just stated to the present controversy, We can say that since it is now unprofitable,
nay a hazard to the health and comfort, to use Lots Nos. 5 and 6 for strictly residential
purposes, defendants- appellees should be permitted, on the strength of the resolution
promulgated under the police power of the municipality, to use the same for
commercial purposes. In Burgess v. Magarian et al. it was, held that "restrictive
covenants running with the land are binding on all subsequent purchasers ... "
However, Section 23 of the zoning ordinance involved therein contained
a proviso expressly declaring that the ordinance was not intended "to interfere with or
abrogate or annul any easements, covenants or other agreement between
parties." 58 In the case at bar, no such proviso is found in the subject resolution.
It is, therefore, clear that even if the subject building restrictions were assumed by the
defendant-appellee as vendee of Lots Nos. 5 and 6, in the corresponding deeds of
sale, and later, in Transfer Certificates of Title Nos. 101613 and 106092, the
contractual obligations so assumed cannot prevail over Resolution No. 27, of the
Municipality of Mandaluyong, which has validly exercised its police power through the
said resolution. Accordingly, the building restrictions, which declare Lots Nos. 5 and 6
as residential, cannot be enforced.
IN VIEW OF THE FOREGOING, the decision appealed from, dismissing the
complaint, is hereby AFFIRMED. "without pronouncement as to costs.
SO ORDERED.
EN BANC
G.R. No. L-38429 June 30, 1988
CARLOS BALACUIT, LAMBERTO TAN and SERGIO YU CARCEL, petitioners-
appellants,
vs.
COURT OF FIRST INSTANCE OF AGUSAN DEL NORTE AND BUTUAN CITY,
Branch 11, and the CITY OF BUTUAN, respondents-appellees.
Romeo B. Sanchez, Eduardo Deza Mercado and Wilfred D. Asis for petitioners.
The City Legal Officer for respondents-appeliees.
GANCAYCO, J.:
At issue in the petition for review before Us is the validity and constitutionality of
Ordinance No. 640 passed by the Municipal Board of the City of Butuan on April 21,
1969, the title and text of which are reproduced below:
ORDINANCE--640
ORDINANCE PENALIZING ANY PERSON, GROUP OF
PERSONS, ENTITY OR CORPORATION ENGAGED IN THE
BUSINESS OF SELLING ADMISSION TICKETS TO ANY MOVIE
OR OTHER PUBLIC EXHIBITIONS, GAMES, CONTESTS OR
OTHER PERFORMANCES TO REQUIRE CHILDREN
BETWEEN SEVEN (7) AND TWELVE (12) YEARS OF AGE TO
PAY FULL PAYMENT FOR TICKETS INTENDED FOR ADULTS
BUT SHOULD CHARGE ONLY ONE-HALF OF THE SAID
TICKET
xxx xxx xxx
Be it ordained by the Municipal Board of the City of Butuan in
session assembled, that:
SECTION 1It shall be unlawful for any person, group of
persons, entity, or corporation engaged in the business of selling
admission tickets to any movie or other public exhibitions, games,
contests, or other performances to require children between
seven (7) and twelve (12) years of age to pay full payment for
admission tickets intended for adults but should charge only one-
half of the value of the said tickets.
SECTION 2Any person violating the provisions of this
Ordinance shall upon conviction be punished by a fine of not less
than TWO HUNDRED PESOS (P200.00) but not more than SIX
HUNDRED PESOS (P600.00) or an imprisonment of not less
than TWO (2) MONTHS or not more than SIX (6) MONTHS or
both such firm and imprisonment in the discretion of the Court.
If the violator be a firm or corporation the penalty shall be
imposed upon the Manager, Agent or Representative of such firm
or corporation.
SECTION 3This ordinance shall take effect upon its approval.
Petitioners are Carlos Balacuit Lamberto Tan, and Sergio Yu Carcel managers of the
Maya and Dalisay Theaters, the Crown Theater, and the Diamond Theater,
respectively. Aggrieved by the effect of Ordinance No. 640, they filed a complaint
before the Court of First Instance of Agusan del Norte and Butuan City docketed as
Special Civil Case No. 237 on June 30, 1969 praying, inter alia, that the subject
ordinance be declared unconstitutional and, therefore, void and unenforceable. 1
Upon motion of the petitioners, 2 a temporary restraining order was issued on July 14,
1969 by the court a quo enjoining the respondent City of Butuan and its officials from
enforcing Ordinance No. 640. 3 On July 29, 1969, respondents filed their answer
sustaining the validity of the ordinance. 4
On January 30, 1973, the litigants filed their stipulation of facts. 5 On June 4, 1973, the
respondent court rendered its decision, 6 the dispositive part of which reads:
IN THE LIGHT OF ALL THE FOREGOING, the Court hereby
adjudges in favor of the respondents and against the petitioners,
as follows:
1. Declaring Ordinance No. 640 of the City of Butuan
constitutional and valid: Provided, however, that the fine for a
single offense shall not exceed TWO HUNDRED PESOS, as
prescribed in the aforequoted Section 15 (nn) of Rep. Act No.
523;
2. Dissolving the restraining order issued by this Court; and;
3. Dismissing the complaint, with costs against the petitioners.
4. SO ORDERED. 7
Petitioners filed their motion for reconsideration 8 of the decision of the court a quo
which was denied in a resolution of the said court dated November 10, 1973. 9
Hence, this petition.
Petitioners attack the validity and constitutionality of Ordinance No. 640 on the
grounds that it is ultra vires and an invalid exercise of police power.
Petitioners contend that Ordinance No. 640 is not within the power of' the Municipal
Board to enact as provided for in Section 15(n) of Republic Act No. 523, the Charter of
the City of Butuan, which states:
Sec. 15. General powers and duties of the Board Except as
otherwise provided by law, and subject to the conditions and
limitations thereof, the Municipal Board shall have the following
legislative powers:
xxx xxx xxx
(n) To regulate and fix the amount of the license fees for the
following; . . . theaters, theatrical performances, cinematographs,
public exhibitions and all other performances and places of
amusements ...
xxx xxx xxx
Respondent City of Butuan, on the other hand, attempts to justify the enactment of the
ordinance by invoking the general welfare clause embodied in Section 15 (nn) of the
cited law, which provides:
(nn) To enact all ordinances it may deem necessary and proper
for the sanitation and safety, the furtherance of the prosperity, and
the promotion of the morality, peace, good order, comfort,
convenience, and general welfare of the city and its inhabitants,
and such others as may be necessary to carry into effect and
discharge the powers and duties conferred by this Act, and to fix
the penalties for the violation of the ordinances, which shall not
exceed a two hundred peso fine or six months imprisonment, or
both such fine and imprisonment, for a single offense.
We can see from the aforecited Section 15(n) that the power to regulate and fix the
amount of license fees for theaters, theatrical performances, cinematographs, public
exhibitions and other places of amusement has been expressly granted to the City of
Butuan under its charter. But the question which needs to be resolved is this: does this
power to regulate include the authority to interfere in the fixing of prices of admission
to these places of exhibition and amusement whether under its general grant of power
or under the general welfare clause as invoked by the City?
This is the first time this Court is confronted with the question of direct interference by
the local government with the operation of theaters, cinematographs and the like to
the extent of fixing the prices of admission to these places. Previous decisions of this
Court involved the power to impose license fees upon businesses of this nature as a
corollary to the power of the local government to regulate them. Ordinances which
required moviehouses or theaters to increase the price of their admission tickets
supposedly to cover the license fees have been held to be invalid for these
impositions were considered as not merely license fees but taxes for purposes of
revenue and not regulation which the cities have no power to exact, 10 unless
expressly granted by its charter. 11
Applying the ruling in Kwong Sing v. City of Manila, 12 where the word "regulate" was
interpreted to include the power to control, to govern and to restrain, it would seem
that under its power to regulate places of exhibitions and amusement, the Municipal
Board of the City of Butuan could make proper police regulations as to the mode in
which the business shall be exercised.
While in a New York case, 13 an ordinance which regulates the business of selling
admission tickets to public exhibitions or performances by virtue of the power of cities
under the General City Law "to maintain order, enforce the laws, protect property and
preserve and care for the safety, health, comfort and general welfare of the inhabitants
of the city and visitors thereto; and for any of said purposes, to regulate and license
occupations" was considered not to be within the scope of any duty or power implied
in the charter. It was held therein that the power of regulation of public exhibitions and
places of amusement within the city granted by the charter does not carry with it any
authority to interfere with the price of admission to such places or the resale of tickets
or tokens of admission.
In this jurisdiction, it is already settled that the operation of theaters, cinematographs
and other places of public exhibition are subject to regulation by the municipal council
in the exercise of delegated police power by the local government. 14 Thus, in People
v. Chan, 15 an ordinance of the City of Manila prohibiting first run cinematographs from
selling tickets beyond their seating capacity was upheld as constitutional for being a
valid exercise of police power. Still in another case, 16 the validity of an ordinance of
the City of Bacolod prohibiting admission of two or more persons in moviehouses and
other amusement places with the use of only one ticket was sustained as a valid
regulatory police measure not only in the interest of preventing fraud in so far as
municipal taxes are concerned but also in accordance with public health, public safety,
and the general welfare.
The City of Butuan, apparently realizing that it has no authority to enact the ordinance
in question under its power to regulate embodied in Section 15(n), now invokes the
police power as delegated to it under the general welfare clause to justify the
enactment of said ordinance.
To invoke the exercise of police power, not only must it appear that the interest of the
public generally requires an interference with private rights, but the means adopted
must be reasonably necessary for the accomplishment of the purpose and not unduly
oppressive upon individuals. 17 The legislature may not, under the guise of protecting
the public interest, arbitrarily interfere with private business, or impose unusual and
unnecessary restrictions upon lawful occupations. In other words, the determination as
to what is a proper exercise of its police power is not final or conclusive, but is subject
to the supervision of the courts. 18
Petitioners maintain that Ordinance No. 640 violates the due process clause of the
Constitution for being oppressive, unfair, unjust, confiscatory, and an undue restraint
of trade, and violative of the right of persons to enter into contracts, considering that
the theater owners are bound under a contract with the film owners for just admission
prices for general admission, balcony and lodge.
In Homeowners' Association of the Philippines, Inc. v. Municipal Board of the City of
Manila, 19 this Court held:
The authority of municipal corporations to regulate is essentially
police power, Inasmuch as the same generally entails a
curtailment of the liberty, the rights and/or the property of persons,
which are protected and even guaranteed by the Constitution, the
exercise of police power is necessarily subject to a qualification,
limitation or restriction demanded by the regard, the respect and
the obedience due to the prescriptions of the fundamental law,
particularly those forming part of the Constitution of Liberty,
otherwise known as the Bill of Rights the police power
measure must be reasonable. In other words, individual rights
may be adversely affected by the exercise of police power to the
extent only and only to the extent--that may be fairly required
by the legitimate demands of public interest or public welfare.
What is the reason behind the enactment of Ordinance No. 640?
A reading of the minutes of the regular session of the Municipal Board when the
ordinance in question was passed shows that a certain Councilor Calo, the proponent
of the measure, had taken into account the complaints of parents that for them to pay
the full price of admission for their children is too financially burdensome.
The trial court advances the view that "even if the subject ordinance does not spell out
its raison d'etre in all probability the respondents were impelled by the awareness that
children are entitled to share in the joys of their elders, but that considering that, apart
from size, children between the ages of seven and twelve cannot fully grasp the
nuance of movies or other public exhibitions, games, contests or other performances,
the admission prices with respect to them ought to be reduced. 19a
We must bear in mind that there must be public necessity which demands the
adoption of proper measures to secure the ends sought to be attained by the
enactment of the ordinance, and the large discretion is necessarily vested in the
legislative authority to determine not only what the interests of the public require, but
what measures are necessary for the protection of such interests. 20 The methods or
means used to protect the public health, morals, safety or welfare, must have some
relation to the end in view, for under the guise of the police power, personal rights and
those pertaining to private property will not be permitted to be arbitralily invaded by the
legislative department. 21
We agree with petitioners that the ordinance is not justified by any necessity for the
public interest. The police power legislation must be firmly grounded on public interest
and welfare, and a reasonable relation must exist between purposes and
means. 22 The evident purpose of the ordinance is to help ease the burden of cost on
the part of parents who have to shell out the same amount of money for the admission
of their children, as they would for themselves, A reduction in the price of admission
would mean corresponding savings for the parents; however, the petitioners are the
ones made to bear the cost of these savings. The ordinance does not only make the
petitioners suffer the loss of earnings but it likewise penalizes them for failure to
comply with it.
Furthermore, as petitioners point out, there will be difficulty in its implementation
because as already experienced by petitioners since the effectivity of the ordinance,
children over 12 years of age tried to pass off their age as below 12 years in order to
avail of the benefit of the ordinance. The ordinance does not provide a safeguard
against this undesirable practice and as such, the respondent City of Butuan now
suggests that birth certificates be exhibited by movie house patrons to prove the age
of children. This is, however, not at all practicable. We can see that the ordinance is
clearly unreasonable if not unduly oppressive upon the business of petitioners.
Moreover, there is no discernible relation between the ordinance and the promotion of
public health, safety, morals and the general welfare.
Respondent City of Butuan claims that it was impelled to protect the youth from the
pernicious practice of movie operators and other public exhibitions promoters or the
like of demanding equal price for their admission tickets along with the adults. This
practice is allegedly repugnant and unconscionable to the interest of the City in the
furtherance of the prosperity, peace, good order, comfort, convenience and the
general well-being of its inhabitants.
There is nothing pernicious in demanding equal price for both children and adults. The
petitioners are merely conducting their legitimate businesses. The object of every
business entrepreneur is to make a profit out of his venture. There is nothing immoral
or injurious in charging the same price for both children and adults. In fact, no person
is under compulsion to purchase a ticket. It is a totally voluntary act on the part of the
purchaser if he buys a ticket to such performances.
Respondent City of Butuan claims that Ordinance No. 640 is reasonable and
necessary to lessen the economic burden of parents whose minor children are lured
by the attractive nuisance being maintained by the petitioners. Respondent further
alleges that by charging the full price, the children are being exploited by movie house
operators. We fail to see how the children are exploited if they pay the full price of
admission. They are treated with the same quality of entertainment as the adults. The
supposition of the trial court that because of their age children cannot fully grasp the
nuances of such entertainment as adults do fails to convince Us that the reduction in
admission ticket price is justifiable. In fact, by the very claim of respondent that movies
and the like are attractive nuisances, it is difficult to comprehend why the municipal
board passed the subject ordinance. How can the municipal authorities consider the
movies an attractive nuisance and yet encourage parents and children to patronize
them by lowering the price of admission for children? Perhaps, there is some ,truth to
the argument of petitioners that Ordinance No. 640 is detrimental to the public good
and the general welfare of society for it encourages children of tender age to frequent
the movies, rather than attend to their studies in school or be in their homes.
Moreover, as a logical consequence of the ordinance, movie house and theater
operators will be discouraged from exhibiting wholesome movies for general
patronage, much less children's pictures if only to avoid compliance with the ordinance
and still earn profits for themselves. For after all, these movie house and theater
operators cannot be compelled to exhibit any particular kind of film except those films
which may be dictated by public demand and those which are restricted by censorship
laws. So instead of children being able to share in the joys of their elders as
envisioned by the trial court, there will be a dearth of wholesome and educational
movies for them to enjoy.
There are a number of cases decided by the Supreme Court and the various state
courts of the United States which upheld the right of the proprietor of a theater to fix
the price of an admission ticket as against the right of the state to interfere in this
regard and which We consider applicable to the case at bar.
A theater ticket has been described to be either a mere license, revocable at the will of
the proprietor of the theater or it may be evidence of a contract whereby, for a
valuable consideration, the purchaser has acquired the right to enter the theater and
observe the performance on condition that he behaves properly. 23 Such ticket,
therefore, represents a right, Positive or conditional, as the case may be, according to
the terms of the original contract of sale. This right is clearly a right of property. The
ticket which represents that right is also, necessarily, a species of property. As such,
the owner thereof, in the absence of any condition to the contrary in the contract by
which he obtained it, has the clear right to dispose of it, to sell it to whom he pleases
and at such price as he can obtain. 24 So that an act prohibiting the sale of tickets to
theaters or other places of amusement at more than the regular price was held invalid
as conflicting with the state constitution securing the right of property. 25
In Collister vs. Hayman, 26 it was held:
The defendants were conducting a private business, which, even
if clothed with a public interest, was without a franchise to
accommodate the public, and they had the right to control it, the
same as the proprietors of any other business, subject to such
obligations as were placed upon them by statute. Unlike a carrier
of passengers, for instance, with a franchise from the state, and
hence under obligation to transport anyone who applies and to
continue the business year in and year out, the proprietors of a
theater can open and close their place at will, and no one can
make a lawful complaint. They can charge what they choose for
admission to their theater. They can limit the number admitted.
They can refuse to sell tickets and collect the price of admission
at the door. They can preserve order and enforce quiet while the
performance is going on. They can make it a part of the contract
and condition of admission, by giving due notice and printing the
condition in the ticket that no one shall be admitted under 21
years of age, or that men only or women only shall be admitted,
or that a woman cannot enter unless she is accompanied by a
male escort, and the like. The proprietors, in the control of their
business, may regulate the terms of admission in any reasonable
way. If those terms are not satisfactory, no one is obliged to buy a
ticket or make the contract. If the terms are satisfactory, and the
contract is made, the minds of the parties meet upon the
condition, and the purchaser impliedly promises to perform it.
In Tyson and Bro. United Theater Ticket Officers, Inc. vs. Banton, 27 the United
States Supreme Court held:
... And certainly a place of entertainment is in no legal sense a
public utility; and quite as certainly, its activities are not such that
their enjoyment can be regarded under any conditions from the
point of view of an emergency.
The interest of the public in theaters and other places of
entertainment may be more nearly, and with better reason,
assimilated to the like interest in provision stores and markets and
in the rental of houses and apartments for residence purposes;
although in importance it fails below such an interest in the
proportion that food and shelter are of more moment than
amusement or instruction. As we have shown there is no
legislative power to fix the prices of provisions or clothing, or the
rental charges for houses and apartments, in the absence of
some controlling emergency; and we are unable to perceive any
dissimilarities of such quality or degree as to justify a different rule
in respect of amusements and entertainment ...
We are in consonance with the foregoing observations and conclusions of American
courts. In this jurisdiction, legislation had been passed controlling the prices of goods
commodities and drugs during periods of emergency, 28limiting the net profits of public
utility 29 as well as regulating rentals of residential apartments for a limited period, 30 as
a matter of national policy in the interest of public health and safety, economic security
and the general welfare of the people. And these laws cannot be impugned as
unconstitutional for being violative of the due process clause.
However, the same could not be said of theaters, cinematographs and other
exhibitions. In no sense could these businesses be considered public utilities. The
State has not found it appropriate as a national policy to interfere with the admission
prices to these performances. This does not mean however, that theaters and
exhibitions are not affected with public interest even to a certain degree. Motion
pictures have been considered important both as a medium for the communication of
Ideas and expression of the artistic impulse. Their effects on the perceptions by our
people of issues and public officials or public figures as well as the prevailing cultural
traits are considerable. 31People of all ages flock to movie houses, games and other
public exhibitions for recreation and relaxation. The government realizing their
importance has seen it fit to enact censorship laws to regulate the movie
industry. 32 Their aesthetic entertainment and even educational values cannot be
underestimated. Even police measures regulating the operation of these businesses
have been upheld in order to safeguard public health and safety.
Nonetheless, as to the question of the subject ordinance being a valid exercise of
police power, the same must be resolved in the negative. While it is true that a
business may be regulated, it is equally true that such regulation must be within the
bounds of reason, that is, the regulatory ordinance must be reasonable, and its
provisions cannot be oppressive amounting to an arbitrary interference with the
business or calling subject of regulation. A lawful business or calling may not, under
the guise of regulation, be unreasonably interfered with even by the exercise of police
power. 33 A police measure for the regulation of the conduct, control and operation of a
business should not encroach upon the legitimate and lawful exercise by the citizens
of their property rights. 34 The right of the owner to fix a price at which his property
shall be sold or used is an inherent attribute of the property itself and, as such, within
the protection of the due process clause."" Hence, the proprietors of a theater have a
right to manage their property in their own way, to fix what prices of admission they
think most for their own advantage, and that any person who did not approve could
stay away. 36
Respondent City of Butuan argues that the presumption is always in favor of the
validity of the ordinance. This maybe the rule but it has already been held that
although the presumption is always in favor of the validity or reasonableness of the
ordinance, such presumption must nevertheless be set aside when the invalidity or
unreasonableness appears on the face of the ordinance itself or is established by
proper evidence. 37 The exercise of police power by the local government is valid
unless it contravenes the fundamental law of the land, or an act of the legislature, or
unless it is against public policy or is unreasonable, oppressive, partial, discriminating
or in derogation of a common right. 38
Ordinance No. 640 clearly invades the personal and property rights of petitioners for
even if We could assume that, on its face, the interference was reasonable, from the
foregoing considerations, it has been fully shown that it is an unwarranted and
unlawful curtailment of the property and personal rights of citizens. For being
unreasonable and an undue restraint of trade, it cannot, under the guise of exercising
police power, be upheld as valid.
WHEREFORE, the decision of the trial court in Special Civil Case No. 237 is hereby
REVERSED and SET ASIDE and a new judgment is hereby rendered declaring
Ordinance No. 640 unconstitutional and, therefore, null and void. This decision is
immediately executory.
SO ORDERED.
EN BANC
[G.R. No. 149743. February 18, 2005]
LEONARDO TAN, ROBERT UY and LAMBERTO TE, petitioners, vs. SOCORRO
Y. PEREA, respondent.
DECISION
TINGA, J.:
The resolution of the present petition effectively settles the question of how
many cockpits may be allowed to operate in a city or municipality.
There are two competing values of high order that come to fore in this case the
traditional power of the national government to enact police power measures, on one
hand, and the vague principle of local autonomy now enshrined in the Constitution on
the other. The facts are simple, but may be best appreciated taking into account the
legal milieu which frames them.
In 1974, Presidential Decree (P.D.) No. 449, otherwise known as the
Cockfighting Law of 1974, was enacted. Section 5(b) of the Decree provided for limits
on the number of cockpits that may be established in cities and municipalities in the
following manner:
Section 5. Cockpits and Cockfighting in General.
(b) Establishment of Cockpits. Only one cockpit shall be allowed in each city or
municipality, except that in cities or municipalities with a population of over one
hundred thousand, two cockpits may be established, maintained and operated.
With the enactment of the Local Government Code of 1991,[1] the municipal
sangguniang bayan were empowered, [a]ny law to the contrary notwithstanding, to
authorize and license the establishment, operation and maintenance of cockpits, and
regulate cockfighting and commercial breeding of gamecocks.[2]
In 1993, the Sangguniang Bayan of the municipality of Daanbantayan,[3] Cebu
Province, enacted Municipal Ordinance No. 6 (Ordinance No. 6), Series of 1993,
which served as the Revised Omnibus Ordinance prescribing and promulgating the
rules and regulations governing cockpit operations in Daanbantayan. [4] Section 5
thereof, relative to the number of cockpits allowed in the municipality, stated:
Section 5. There shall be allowed to operate in the Municipality of Daanbantayan,
Province of Cebu, not more than its equal number of cockpits based upon the
population provided for in PD 449, provided however, that this specific section can be
amended for purposes of establishing additional cockpits, if the Municipal population
so warrants.[5]
Shortly thereafter, the Sangguniang Bayan passed an amendatory ordinance,
Municipal Ordinance No. 7 (Ordinance No. 7), Series of 1993, which amended the
aforequoted Section 5 to now read as follows:
Section 5. Establishment of Cockpit. There shall be allowed to operate in the
Municipality of Daanbantayan, Province of Cebu, not more than three (3) cockpits. [6]
On 8 November 1995, petitioner Leonardo Tan (Tan) applied with the Municipal
Gamefowl Commission for the issuance of a permit/license to establish and operate a
cockpit in Sitio Combado, Bagay, in Daanbantayan. At the time of his application,
there was already another cockpit in operation in Daanbantayan, operated by
respondent Socorro Y. Perea (Perea), who was the duly franchised and licensed
cockpit operator in the municipality since the 1970s. Pereas franchise, per records,
was valid until 2002.[7]
The Municipal Gamefowl Commission favorably recommended to the mayor of
Daanbantayan, petitioner Lamberto Te (Te), that a permit be issued to Tan. On 20
January 1996, Te issued a mayors permit allowing Tan to establish/operate/conduct
the business of a cockpit in Combado, Bagay, Daanbantayan, Cebu for the period
from 20 January 1996 to 31 December 1996.[8]
This act of the mayor served as cause for Perea to file a Complaint for damages
with a prayer for injunction against Tan, Te, and Roberto Uy, the latter allegedly an
agent of Tan.[9]Perea alleged that there was no lawful basis for the establishment of a
second cockpit. She claimed that Tan conducted his cockpit fights not in Combado,
but in Malingin, at a site less than five kilometers away from her own cockpit. She
insisted that the unlawful operation of Tans cockpit has caused injury to her own
legitimate business, and demanded damages of at least Ten Thousand Pesos
(P10,000.00) per month as actual damages, One Hundred Fifty Thousand Pesos
(P150,000.00) as moral damages, and Fifty Thousand Pesos (P50,000.00) as
exemplary damages. Perea also prayed that the permit issued by Te in favor of Tan
be declared as null and void, and that a permanent writ of injunction be issued against
Te and Tan preventing Tan from conducting cockfights within the municipality and Te
from issuing any authority for Tan to pursue such activity. [10]
The case was heard by the Regional Trial Court (RTC), [11] Branch 61 of Bogo,
Cebu, which initially granted a writ of preliminary injunction.[12] During trial, herein
petitioners asserted that under the Local Government Code of 1991, the sangguniang
bayan of each municipality now had the power and authority to grant franchises and
enact ordinances authorizing the establishment, licensing, operation and maintenance
of cockpits.[13] By virtue of such authority, the Sangguniang Bayan of Daanbantayan
promulgated Ordinance Nos. 6 and 7. On the other hand, Perea claimed that the
amendment authorizing the operation of not more than three (3) cockpits in
Daanbantayan violated Section 5(b) of the Cockfighting Law of 1974, which allowed
for only one cockpit in a municipality with a population as Daanbantayan. [14]
In a Decision dated 10 March 1997, the RTC dismissed the complaint. The court
observed that Section 5 of Ordinance No. 6, prior to its amendment, was by specific
provision, an implementation of the Cockfighting Law.[15] Yet according to the RTC,
questions could be raised as to the efficacy of the subsequent amendment under
Ordinance No. 7, since under the old Section 5, an amendment allowing additional
cockpits could be had only if the municipal population so warrants. [16] While the RTC
seemed to doubt whether this condition had actually been fulfilled, it nonetheless
declared that since the case was only for damages, the [RTC] cannot grant more relief
than that prayed for.[17] It ruled that there was no evidence, testimonial or
documentary, to show that plaintiff had actually suffered damages. Neither was there
evidence that Te, by issuing the permit to Tan, had acted in bad faith, since such
issuance was pursuant to municipal ordinances that nonetheless remained in
force.[18] Finally, the RTC noted that the assailed permit had expired on 31 December
1996, and there was no showing that it had been renewed. [19]
Perea filed a Motion for Reconsideration which was denied in an Order dated 24
February 1998. In this Order, the RTC categorically stated that Ordinance Nos. 6 and
7 were valid and legal for all intents and purpose[s]. [20] The RTC also noted that the
Sangguniang Bayan had also promulgated Resolution No. 78-96, conferring on Tan a
franchise to operate a cockpit for a period of ten (10) years from February 1996 to
2006.[21] This Resolution was likewise affirmed as valid by the RTC. The RTC noted
that while the ordinances seemed to be in conflict with the Cockfighting Law, any
doubt in interpretation should be resolved in favor of the grant of more power to the
local government unit, following the principles of devolution under the Local
Government Code.[22]
The Decision and Order of the RTC were assailed by Perea on an appeal with
the Court of Appeals which on 21 May 2001, rendered the Decision now
assailed.[23] The perspective from which the Court of Appeals viewed the issue was
markedly different from that adopted by the RTC. Its analysis of the Local Government
Code, particularly Section 447(a)(3)(V), was that the provision vesting unto the
sangguniang bayan the power to authorize and license the establishment of cockpits
did not do away with the Cockfighting Law, as these two laws are not necessarily
inconsistent with each other. What the provision of the Local Government Code did,
according to the Court of Appeals, was to transfer to the sangguniang bayan powers
that were previously conferred on the Municipal Gamefowl Commission. [24]
Given these premises, the appellate court declared as follows:
Ordinance No. 7 should [be] held invalid for allowing, in unconditional terms, the
operation of not more than three cockpits in Daan Bantayan (sic), clearly dispensing
with the standard set forth in PD 449. However, this issue appears to have been
mooted by the expiration of the Mayors Permit granted to the defendant which has not
been renewed.[25]
As to the question of damages, the Court of Appeals agreed with the findings of
the RTC that Perea was not entitled to damages. Thus, it affirmed the previous ruling
denying the claim for damages. However, the Court of Appeals modified the RTCs
Decision in that it now ordered that Tan be enjoined from operating a cockpit and
conducting any cockfights within Daanbantayan.[26]
Thus, the present Petition for Review on Certiorari.
Petitioners present two legal questions for determination: whether the Local
Government Code has rendered inoperative the Cockfighting Law; and whether the
validity of a municipal ordinance may be determined in an action for damages which
does not even contain a prayer to declare the ordinance invalid.[27] As the denial of the
prayer for damages by the lower court is not put in issue before this Court, it shall not
be passed upon on review.
The first question raised is particularly interesting, and any definitive resolution
on that point would have obvious ramifications not only to Daanbantayan, but all other
municipalities and cities. However, we must first determine the proper scope of judicial
inquiry that we could engage in, given the nature of the initiatory complaint and the
rulings rendered thereupon, the exact point raised in the second question.
Petitioners claim that the Court of Appeals, in declaring Ordinance No. 7 as
invalid, embarked on an unwarranted collateral attack on the validity of a municipal
ordinance.[28] Pereas complaint, which was for damages with preliminary injunction,
did not pray for the nullity of Ordinance No. 7. The Municipality of Daanbantayan as a
local government unit was not made a party to the case, nor did any legal counsel on
its behalf enter any appearance. Neither was the Office of the Solicitor General given
any notice of the case.[29]
These concerns are not trivial.[30] Yet, we must point out that the Court of
Appeals did not expressly nullify Ordinance No. 7, or any ordinance for that matter.
What the appellate court did was to say that Ordinance No. 7 should therefore be
held invalid for being in violation of the Cockfighting Law.[31] In the next breath
though, the Court of Appeals backtracked, saying that this issue appears to have been
mooted by the expiration of the Mayors Permit granted to Tan.[32]
But our curiosity is aroused by the dispositive portion of the assailed Decision,
wherein the Court of Appeals enjoined Tan from operating a cockpit and conducting
any cockfights within Daanbantayan.[33] Absent the invalidity of Ordinance No. 7, there
would be no basis for this injunction. After all, any future operation of a cockpit by Tan
in Daanbantayan, assuming all other requisites are complied with, would be validly
authorized should Ordinance No. 7 subsist.
So it seems, for all intents and purposes, that the Court of Appeals did deem
Ordinance No. 7 a nullity. Through such resort, did the appellate court in effect allow a
collateral attack on the validity of an ordinance through an action for damages, as the
petitioners argue?
 The initiatory Complaint filed by Perea deserves close scrutiny. Immediately, it
can be seen that it is not only an action for damages, but also one for injunction. An
action for injunction will require judicial determination whether there exists a right
in esse which is to be protected, and if there is an act constituting a violation of such
right against which injunction is sought. At the same time, the mere fact of injury alone
does not give rise to a right to recover damages. To warrant the recovery of damages,
there must be both a right of action for a legal wrong inflicted by the defendant, and
damage resulting to the plaintiff therefrom. In other words, in order that the law will
give redress for an act causing damage, there must be damnum et injuriathat act must
be not only hurtful, but wrongful.[34]
Indubitably, the determination of whether injunction or damages avail in this
case requires the ascertainment of whether a second cockpit may be legally allowed
in Daanbantayan. If this is permissible, Perea would not be entitled either to injunctive
relief or damages.
Moreover, an examination of the specific allegations in the Complaint reveals
that Perea therein puts into question the legal basis for allowing Tan to operate
another cockpit in Daanbantayan. She asserted that there is no lawful basis for the
establishment of a second cockpit considering the small population of
[Daanbantayan],[35] a claim which alludes to Section 5(b) of the Cockfighting Law
which prohibits the establishment of a second cockpit in municipalities of less than ten
thousand (10,000) in population. Perea likewise assails the validity of the permit
issued to Tan and prays for its annulment, and also seeks that Te be enjoined from
issuing any special permit not only to Tan, but also to any other person outside of a
duly licensed cockpit in Daanbantayan, Cebu.[36]
It would have been preferable had Perea expressly sought the annulment of
Ordinance No. 7. Yet it is apparent from her Complaint that she sufficiently alleges
that there is no legal basis for the establishment of a second cockpit. More
importantly, the petitioners themselves raised the valid effect of Ordinance No. 7 at the
heart of their defense against the complaint, as adverted to in their Answer.[37] The
averment in the Answer that Ordinance No. 7 is valid can be considered as an
affirmative defense, as it is the allegation of a new matter which, while hypothetically
admitting the material allegations in the complaint, would nevertheless bar
recovery.[38] Clearly then, the validity of Ordinance No. 7 became a justiciable matter
for the RTC, and indeed Perea squarely raised the argument during trial that said
ordinance violated the Cockfighting Law.[39]
Moreover, the assailed rulings of the RTC, its Decision and
subsequent Order denying Pereas Motion for Reconsideration, both discuss the
validity of Ordinance No. 7. In the Decision, the RTC evaded making a categorical
ruling on the ordinances validity because the case was only for damages, [thus the
RTC could] not grant more relief than that prayed for. This reasoning is unjustified,
considering that Perea also prayed for an injunction, as well as for the annulment of
Tans permit. The resolution of these two questions could very well hinge on the
validity of Ordinance No. 7.
Still, in the Order denying Pereas Motion for Reconsideration, the RTC felt less
inhibited and promptly declared as valid not only Ordinance No. 7, but also Resolution
No. 78-96 of the Sangguniang Bayan dated 23 February 1996, which conferred on
Tan a franchise to operate a cockpit from 1996 to 2006. [40] In the Order, the RTC ruled
that while Ordinance No. 7 was in apparent conflict with the Cockfighting Law, the
ordinance was justified under Section 447(a)(3)(v) of the Local Government Code.
This express affirmation of the validity of Ordinance No. 7 by the RTC was the
first assigned error in Pereas appeal to the Court of Appeals.[41] In their Appellees
Brief before the appellate court, the petitioners likewise argued that Ordinance No. 7
was valid and that the Cockfighting Law was repealed by the Local Government
Code.[42] On the basis of these arguments, the Court of Appeals rendered its
assailed Decision, including its ruling that the Section 5(b) of the Cockfighting Law
remains in effect notwithstanding the enactment of the Local Government Code.
Indubitably, the question on the validity of Ordinance No. 7 in view of the
continuing efficacy of Section 5(b) of the Cockfighting Law is one that has been fully
litigated in the courts below. We are comfortable with reviewing that question in the
case at bar and make dispositions proceeding from that key legal question. This is
militated by the realization that in order to resolve the question whether injunction
should be imposed against the petitioners, there must be first a determination whether
Tan may be allowed to operate a second cockpit in Daanbantayan. Thus, the conflict
between Section 5(b) of the Cockfighting Law and Ordinance No. 7 now ripens for
adjudication.
In arguing that Section 5(b) of the Cockfighting Law has been repealed,
petitioners cite the following provisions of Section 447(a)(3)(v) of the Local
Government Code:
Section 447. Powers, Duties, Functions and Compensation. (a) The sangguniang
bayan, as the legislative body of the municipality, shall enact ordinances, approve
resolutions and appropriate funds for the general welfare of the municipality and its
inhabitants pursuant to Section 16 of this Code and in the proper exercise of the
corporate powers of the municipality as provided for under Section 22 of this Code,
and shall:
....
(3) Subject to the provisions of Book II of this Code, grant franchises, enact ordinances
authorizing the issuance of permits or licenses, or enact ordinances levying taxes,
fees and charges upon such conditions and for such purposes intended to promote
the general welfare of the inhabitants of the municipality, and pursuant to this
legislative authority shall:
....
(v) Any law to the contrary notwithstanding, authorize and
license the establishment, operation, and maintenance of
cockpits, and regulate cockfighting and commercial breeding
of gamecocks; Provided, that existing rights should not be
prejudiced;
For the petitioners, Section 447(a)(3)(v) sufficiently repeals Section 5(b) of the
Cockfighting Law, vesting as it does on LGUs the power and authority to issue
franchises and regulate the operation and establishment of cockpits in their respective
municipalities, any law to the contrary notwithstanding.
 However, while the Local Government Code expressly repealed several laws,
the Cockfighting Law was not among them. Section 534(f) of the Local Government
Code declares that all general and special laws or decrees inconsistent with the Code
are hereby repealed or modified accordingly, but such clause is not an express
repealing clause because it fails to identify or designate the acts that are intended to
be repealed.[43] It is a cardinal rule in statutory construction that implied repeals are
disfavored and will not be so declared unless the intent of the legislators is
manifest.[44] As laws are presumed to be passed with deliberation and with knowledge
of all existing ones on the subject, it is logical to conclude that in passing a statute it is
not intended to interfere with or abrogate a former law relating to the same subject
matter, unless the repugnancy between the two is not only irreconcilable but also clear
and convincing as a result of the language used, or unless the latter Act fully
embraces the subject matter of the earlier.[45]
Is the one-cockpit-per-municipality rule under the Cockfighting Law clearly and
convincingly irreconcilable with Section 447(a)(3)(v) of the Local Government Code?
The clear import of Section 447(a)(3)(v) is that it is the sangguniang bayan which is
empowered to authorize and license the establishment, operation and maintenance of
cockpits, and regulate cockfighting and commercial breeding of gamecocks,
notwithstanding any law to the contrary. The necessity of the qualifying phrase any
law to the contrary notwithstanding can be discerned by examining the history of laws
pertaining to the authorization of cockpit operation in this country.
Cockfighting, or sabong in the local parlance, has a long and storied tradition in
our culture and was prevalent even during the Spanish occupation. When the newly-
arrived Americans proceeded to organize a governmental structure in the Philippines,
they recognized cockfighting as an activity that needed to be regulated, and it was
deemed that it was the local municipal council that was best suited to oversee such
regulation. Hence, under Section 40 of Act No. 82, the general act for the organization
of municipal governments promulgated in 1901, the municipal council was empowered
to license, tax or close cockpits. This power of the municipal council to authorize or
license cockpits was repeatedly recognized even after the establishment of the
present Republic in 1946.[46] Such authority granted unto the municipal councils to
license the operation of cockpits was generally unqualified by restrictions. [47] The
Revised Administrative Code did impose restrictions on what days cockfights could be
held.[48]
However, in the 1970s, the desire for stricter licensing requirements of cockpits
started to see legislative fruit. The Cockfighting Law of 1974 enacted several of these
restrictions. Apart from the one-cockpit-per-municipality rule, other restrictions were
imposed, such as the limitation of ownership of cockpits to Filipino citizens. [49] More
importantly, under Section 6 of the Cockfighting Law, it was the city or municipal
mayor who was authorized to issue licenses for the operation and maintenance of
cockpits, subject to the approval of the Chief of Constabulary or his authorized
representatives.[50] Thus, the sole discretion to authorize the operation of cockpits was
removed from the local government unit since the approval of the Chief of
Constabulary was now required.
P.D. No. 1802 reestablished the Philippine Gamefowl Commission[51] and
imposed further structure in the regulation of cockfighting. Under Section 4 thereof,
city and municipal mayors with the concurrence of their respective sangguniang
panglunsod or sangguniang bayan, were given the authority to license and regulate
cockfighting, under the supervision of the City Mayor or the Provincial Governor.
However, Section 4 of P.D. No. 1802 was subsequently amended, removing the
supervision exercised by the mayor or governor and substituting in their stead the
Philippine Gamefowl Commission. The amended provision ordained:
Sec. 4. City and Municipal Mayors with the concurrence of their respective
Sanggunians shall have the authority to license and regulate regular cockfighting
pursuant to the rules and regulations promulgated by the Commission and subject to
its review and supervision.
The Court, on a few occasions prior to the enactment of the Local Government
Code in 1991, had opportunity to expound on Section 4 as amended. A discussion of
these cases will provide a better understanding of the qualifier any law to the contrary
notwithstanding provided in Section 447(a)(3)(v).
In Philippine Gamefowl Commission v. Intermediate Appellate Court,[52] the
Court, through Justice Cruz, asserted that the conferment of the power to license and
regulate municipal cockpits in municipal authorities is in line with the policy of local
autonomy embodied in the Constitution.[53] The Court affirmed the annulment of a
resolution of the Philippine Gamefowl Commission which ordered the revocation of a
permit issued by a municipal mayor for the operation of a cockpit and the issuance of
a new permit to a different applicant. According to the Court, the Philippine Gamefowl
Commission did not possess the power to issue cockpit licenses, as this was vested
by Section 4 of P.D. No. 1802, as amended, to the municipal mayor with the
concurrence of the sanggunian. It emphasized that the Philippine Gamefowl
Commission only had review and supervision powers, as distinguished from control,
over ordinary cockpits.[54] The Court also noted that the regulation of cockpits was
vested in municipal officials, subject only to the guidelines laid down by the Philippine
Gamefowl Commission.[55] The Court conceded that [if] at all, the power to review
includes the power to disapprove; but it does not carry the authority to substitute ones
own preferences for that chosen by the subordinate in the exercise of its sound
discretion.
The twin pronouncements that it is the municipal authorities who are
empowered to issue cockpit licenses and that the powers of the Philippine Gamefowl
Commission were limited to review and supervision were affirmed in Deang v.
Intermediate Appellate Court,[56] Municipality of Malolos v. Libangang Malolos
Inc.[57] and Adlawan v. Intermediate Appellate Court.[58] But notably in Cootauco v.
Court of Appeals,[59] the Court especially noted that Philippine Gamefowl
Commission did indicate that the Commissions power of review includes the power to
disapprove.[60] Interestingly, Justice Cruz, the writer of Philippine Gamefowl
Commission, qualified his concurrence in Cootauco subject to the reservations made
in [Philippine Gamefowl Commission] regarding the review powers of the PGC over
cockpit licenses issued by city and municipal mayors.[61]
These cases reiterate what has been the traditional prerogative of municipal
officials to control the issuances of licenses for the operation of cockpits.
Nevertheless, the newly-introduced role of the Philippine Gamefowl Commission vis--
vis the operation of cockpits had caused some degree of controversy, as shown by the
cases above cited.
 Then, the Local Government Code of 1991 was enacted. There is no more
forceful authority on this landmark legislation than Senator Aquilino Pimentel, Jr., its
principal author. In his annotations to the Local Government Code, he makes the
following remarks relating to Section 447(a)(3)(v):
12. Licensing power. In connection with the power to grant licenses lodged with it,
the Sangguniang Bayan may now regulate not only businesses but also occupations,
professions or callings that do not require government examinations within its
jurisdiction. It may also authorize and license the establishment, operation and
maintenance of cockpits, regulate cockfighting, and the commercial breeding of
gamecocks. Existing rights however, may not be prejudiced. The power to license
cockpits and permits for cockfighting has been removed completely from the
Gamefowl Commission.
Thus, that part of the ruling of the Supreme Court in the case of Municipality of
Malolos v. Libangang Malolos, Inc. et al., which held that the regulation of
cockpits is vested in the municipal councils guidelines laid down by the
Philippine Gamefowl Commission is no longer controlling. Under [Section
447(a)(3)(v)], the power of the Sanggunian concerned is no longer subject to the
supervision of the Gamefowl Commission.[62]
The above observations may be faulted somewhat in the sense that they fail to
acknowledge the Courts consistent position that the licensing power over cockpits
belongs exclusively to the municipal authorities and not the Philippine Gamefowl
Commission. Yet these views of Senator Pimentel evince the apparent confusion
regarding the role of the Philippine Gamefowl Commission as indicated in the cases
previously cited, and accordingly bring the phrase Section 447(a)(3)(v) used in any
law to the contrary notwithstanding into its proper light. The qualifier serves notice, in
case it was still doubtful, that it is the sanggunian bayan concerned alone which has
the power to authorize and license the establishment, operation and maintenance of
cockpits, and regulate cockfighting and commercial breeding of gamecocks within its
territorial jurisdiction.
Given the historical perspective, it becomes evident why the legislature found
the need to use the phrase any law to the contrary notwithstanding in Section
447(a)(3)(v). However, does the phrase similarly allow the Sangguniang Bayan to
authorize more cockpits than allowed under Section 5(d) of the Cockfighting Law?
Certainly, applying the test of implied repeal, these two provisions can stand together.
While the sanggunian retains the power to authorize and license the establishment,
operation, and maintenance of cockpits, its discretion is limited in that it cannot
authorize more than one cockpit per city or municipality, unless such cities or
municipalities have a population of over one hundred thousand, in which case two
cockpits may be established. Considering that Section 447(a)(3)(v) speaks essentially
of the identity of the wielder of the power of control and supervision over cockpit
operation, it is not inconsistent with previous enactments that impose restrictions on
how such power may be exercised. In short, there is no dichotomy between affirming
the power and subjecting it to limitations at the same time.
Perhaps more essential than the fact that the two controverted provisions are
not inconsistent when put together, the Court recognizes that Section 5(d) of the
Cockfighting Law arises from a valid exercise of police power by the national
government. Of course, local governments are similarly empowered under Section 16
of the Local Government Code. The national government ought to be attuned to the
sensitivities of devolution and strive to be sparing in usurping the prerogatives of local
governments to regulate the general welfare of their constituents.
We do not doubt, however, the ability of the national government to implement
police power measures that affect the subjects of municipal government, especially if
the subject of regulation is a condition of universal character irrespective of territorial
jurisdictions. Cockfighting is one such condition. It is a traditionally regulated activity,
due to the attendant gambling involved[63] or maybe even the fact that it essentially
consists of two birds killing each other for public amusement. Laws have been
enacted restricting the days when cockfights could be held, [64] and legislation has even
been emphatic that cockfights could not be held on holidays celebrating national honor
such as Independence Day[65] and Rizal Day.[66]
The Whereas clauses of the Cockfighting Law emphasize that cockfighting
should neither be exploited as an object of commercialism or business enterprise, nor
made a tool of uncontrolled gambling, but more as a vehicle for the preservation and
perpetuation of native Filipino heritage and thereby enhance our national
identity.[67] The obvious thrust of our laws designating when cockfights could be held is
to limit cockfighting and imposing the one-cockpit-per-municipality rule is in line with
that aim. Cockfighting is a valid matter of police power regulation, as it is a form of
gambling essentially antagonistic to the aims of enhancing national productivity and
self-reliance.[68] Limitation on the number of cockpits in a given municipality is a
reasonably necessary means for the accomplishment of the purpose of controlling
cockfighting, for clearly more cockpits equals more cockfights.
If we construe Section 447(a)(3)(v) as vesting an unlimited discretion to the
sanggunian to control all aspects of cockpits and cockfighting in their respective
jurisdiction, this could lead to the prospect of daily cockfights in municipalities, a
certain distraction in the daily routine of life in a municipality. This certainly goes
against the grain of the legislation earlier discussed. If the arguments of the petitioners
were adopted, the national government would be effectively barred from imposing any
future regulatory enactments pertaining to cockpits and cockfighting unless it were to
repeal Section 447(a)(3)(v).
A municipal ordinance must not contravene the Constitution or any statute,
otherwise it is void. Ordinance No. 7 unmistakably contravenes the Cockfighting Law
in allowing three cockpits in Daanbantayan. Thus, no rights can be asserted by the
petitioners arising from the Ordinance. We find the grant of injunction as ordered by
the appellate court to be well-taken.
WHEREFORE, the petition is DENIED. Costs against petitioners.
SO ORDERED.
EN BANC
G.R. No. 148339 February 23, 2005
LUCENA GRAND CENTRAL TERMINAL, INC., petitioner,
vs.
JAC LINER, INC., Respondent.
DECISION
CARPIO MORALES, J.:
Respondent, JAC Liner, Inc., a common carrier operating buses which ply various
routes to and from Lucena City, assailed, via a petition for prohibition and
injunction1 against the City of Lucena, its Mayor, and the Sangguniang Panlungsod of
Lucena before the Regional Trial Court (RTC) of Lucena City, City Ordinance Nos.
1631 and 1778 as unconstitutional on the ground that, inter alia, the same constituted
an invalid exercise of police power, an undue taking of private property, and a violation
of the constitutional prohibition against monopolies. The salient provisions of the
ordinances are:
Ordinance No. 16312
AN ORDINANCE GRANTING THE LUCENA GRAND CENTRAL TERMINAL, INC., A
FRANCHISE TO CONSTRUCT, FINANCE, ESTABLISH, OPERATE AND MAINTAIN
A COMMON BUS-JEEPNEY TERMINAL FACILITY IN THE CITY OF LUCENA
xxx
SECTION 1. There is hereby granted to the Lucena Grand Central Terminal, Inc., its
successors or assigns, hereinafter referred to as the "grantee", a franchise to
construct, finance, establish, operate, and maintain a common bus-jeepney terminal
facility in the City of Lucena.
SECTION 2. This franchise shall continue for a period of twenty-five years, counted
from the approval of this Ordinance, and renewable at the option of the grantee for
another period of twenty-five (25) years upon such expiration.
xxx
SECTION 4. Responsibilities and Obligations of the City Government of Lucena.
During the existence of the franchise, the City Government of Lucena shall have the
following responsibilities and obligations:
xxx
(c) It shall not grant any third party any privilege and/or concession to operate a bus,
mini-bus and/or jeepney terminal.
xxx
Ordinance No. 17783
AN ORDINANCE REGULATING THE ENTRANCE TO THE CITY OF LUCENA OF
ALL BUSES, MINI-BUSES AND OUT-OF-TOWN PASSENGER JEEPNEYS AND
FOR THIS PURPOSE, AMENDING ORDINACE NO. 1420, SERIES OF 1993, AND
ORDINANCE NO. 1557, SERIES OF 1995
xxx
SECTION 1. The entrance to the City of Lucena of all buses, mini-buses and out-of-
town passenger jeepneys is hereby regulated as follows:
(a) All buses, mini-buses and out-of-town passenger jeepneys shall
be prohibited from entering the cityand are hereby directed to proceed to
the common terminal, for picking-up and/or dropping of their passengers.
(b) All temporary terminals in the City of Lucena are hereby declared
inoperable starting from the effectivity of this ordinance.
xxx
SECTION 3. a) Section 1 of Ordinance No. 1557, Series of 1995, is hereby
amended to read as follows:
Buses, mini-buses, and jeepney type mini-buses from other municipalities and/or local
government units going to Lucena City are directed to proceed to the Common
Terminal located at Diversion Road, Brgy. Ilayang Dupay, to unload and load
passengers.
xxx
c) Section 3 of Ordinance No. 1557, Series of 1995, is hereby amended to
read as follows:
Passenger buses, mini-buses, and jeepney type mini-buses coming from
other municipalities and/or local government units shall utilize the facilities of
the Lucena Grand Central Terminal at Diversion Road, Brgy. Ilayang Dupay,
this City, and no other terminals shall be situated inside or within the
City of Lucena;
d) Section 4 of Ordinance No. 1557, Series of 1995, is hereby amended to
read as follows:
Passenger buses, mini-buses, and jeepney type mini-buses coming from
other municipalities and/or local government units shall avail of the facilities
of the Lucena Grand Central Terminal which is hereby designated as the
officially sanctioned common terminal for the City of Lucena;
e) Section 5 of Ordinance No. 1557, Series of 1995, is hereby amended to
read as follows:
The Lucena Grand Central Terminal is the permanent common terminal as this i
s the entity which was giventhe exclusive franchise by the Sangguniang Panglu
ngsod under Ordinance No. 1631; (Emphasis and underscoring supplied)
These ordinances, by granting an exclusive franchise for twenty five years, renewable
for another twenty five years, to one entity for the construction and operation of one
common bus and jeepney terminal facility in Lucena City, to be located outside the city
proper, were professedly aimed towards alleviating the traffic congestion alleged to
have been caused by the existence of various bus and jeepney terminals within the
city, as the "Explanatory Note"-Whereas Clause adopting Ordinance No. 1778 states:
WHEREAS, in line with the worsening traffic condition of the City of Lucena, and with
the purpose of easing and regulating the flow of the same, it is imperative that the
Buses, Mini-Buses and out-of-town jeepneys be prohibited from maintaining terminals
within the City, but instead directing to proceed to the Lucena Grand Central Terminal
for purposes of picking-up and/or dropping off their passengers;4
Respondent, who had maintained a terminal within the city, was one of those affected
by the ordinances.
Petitioner, Lucena Grand Central Terminal, Inc., claiming legal interest as the grantee
of the exclusive franchise for the operation of the common terminal, 5 was allowed to
intervene in the petition before the trial court.
In the hearing conducted on November 25, 1998, all the parties agreed to dispense
with the presentation of evidence and to submit the case for resolution solely on the
basis of the pleadings filed.6
By Order of March 31, 1999,7 Branch 54 of the Lucena RTC rendered judgment, the
dispositive portion of which reads:
WHEREFORE, in view of the foregoing premises, judgment is hereby rendered, as
follows:
1. Declaring City Ordinance No. 1631 as valid, having been issued in the
exercise of the police power of the City Government of Lucena insofar as
the grant of franchise to the Lucena Grand Central Terminal, Inc., to
construct, finance, establish, operate and maintain common bus-jeepney
terminal facility in the City of Lucena;
2. But however, declaring the provision of Sec. 4(c) of Ordinance No. 1631
to the effect that the City Government shall not grant any third party any
privilege and/or concession to operate a bus, mini-bus and/or jeepney
terminal, as illegal and ultra vires because it contravenes the provisions of
Republic Act No. 7160, otherwise known as "The Local Government Code";
3. Declaring City Ordinance No. 1778 as null and void, the same being also
an ultra vires act of the City Government of Lucena arising from an invalid,
oppressive and unreasonable exercise of the police power, more
specifically, declaring illegal [sections 1(b), 3(c) and 3(e)];
4. Ordering the issuance of a Writ of Prohibition and/or Injunction directing
the respondents public officials, the City Mayor and the Sangguniang
Panglungsod of Lucena, to cease and desist from implementing
Ordinance No. 1778 insofar as said ordinance prohibits or curtails
petitioner from maintaining and operating its own bus terminal subject
to the conditions provided for in Ordinance No. 1557, Sec. 3, which
authorizes the construction of terminal outside the poblacion of Lucena City;
and likewise, insofar as said ordinance directs and compels the
petitioner to use the Lucena Grand Central Terminal Inc., and
furthermore, insofar as it declares that no other terminals shall be
situated, constructed, maintained or established inside or within the
City of Lucena; and furthermore,
5. The Motion to Dismiss filed by the Intervenor, Lucena Grand Central
Terminal Inc., dated October 19, 1998, is hereby DENIED for lack of merit.
SO ORDERED. (Emphasis and underscoring supplied)8
Petitioners Motion for Reconsideration9 of the trial courts order having been denied
by Order of August 6, 1999,10it elevated it via petition for review under Rule 45 before
this Court.11 This Court, by Resolution of November 24, 1999,12 referred the petition to
the Court of Appeals with which it has concurrent jurisdiction, no special and important
reason having been cited for it to take cognizance thereof in the first instance.
By Decision of December 15, 2000,13 the appellate court dismissed the petition and
affirmed the challenged orders of the trial court. Its motion for reconsideration14 having
been denied by the appellate court by Resolution dated June 5, 2001, 15 petitioner
once again comes to this Court via petition for review,16 this time assailing the
Decision and Resolution of the Court of Appeals.
Decision on the petition hinges on two issues, to wit: (1) whether the trial court has
jurisdiction over the case, it not having furnished the Office of the Solicitor General
copy of the orders it issued therein, and (2) whether the City of Lucena properly
exercised its police power when it enacted the subject ordinances.
Petitioner argues that since the trial court failed to serve a copy of its assailed orders
upon the Office of the Solicitor General, it never acquired jurisdiction over the case, it
citing Section 22, Rule 3 of the Rules which provides:
SEC. 22. Notice to the Solicitor General.In any action involving the validity of any
treaty, law, ordinance, executive order, presidential decree, rules or regulations, the
court in its discretion, may require the appearance of the Solicitor General who may
be heard in person or through representative duly designated by him. (Emphasis and
underscoring supplied)
Furthermore, petitioner invokes Sections 3 and 4 of Rule 63 which respectively
provide:
SEC. 3. Notice on Solicitor General. In any action which involves the validity of a
statute, executive order or regulation, or any other governmental regulation,
the Solicitor General shall be notified by the party assailing the same and shall be
entitled to be heard upon such question.
SEC. 4. Local government ordinances. In any action involving the validity of a local
government ordinance, the corresponding prosecutor or attorney of the local
government unit involved shall be similarly notified and entitled to be heard. If such
ordinance is alleged to be unconstitutional, the Solicitor General shall also be
notified and entitled to be heard. (Emphasis and underscoring supplied)
Nowhere, however, is it stated in the above-quoted rules that failure to notify the
Solicitor General about the action is a jurisdictional defect.
In fact, Rule 3, Section 22 gives the courts in any action involving the "validity" of
any ordinance, inter alia, "discretion" to notify the Solicitor General.
Section 4 of Rule 63, which more specifically deals with cases assailing
the constitutionality, not just the validity, of alocal government ordinance, directs that
the Solicitor General "shall also be notified and entitled to be heard." Who will notify
him, Sec. 3 of the same rule provides it is the party which is assailing the local
governments ordinance.
More importantly, however, this Court finds that no procedural defect, fatal or
otherwise, attended the disposition of the case. For respondent actually served a copy
of its petition upon the Office of the Solicitor General on October 1, 1998, two days
after it was filed. The Solicitor General has issued a Certification to that effect. 17 There
was thus compliance with above-quoted rules.
Respecting the issue of whether police power was properly exercised when the
subject ordinances were enacted: As with the State, the local government may be
considered as having properly exercised its police power only if the following
requisites are met: (1) the interests of the public generally, as distinguished from those
of a particular class, require the interference of the State, and (2) the means employed
are reasonably necessary for the attainment of the object sought to be accomplished
and not unduly oppressive upon individuals. Otherwise stated, there must be a
concurrence of a lawful subject and lawful method.18
That traffic congestion is a public, not merely a private, concern, cannot be gainsaid.
In Calalang v. Williams19 which involved a statute authorizing the Director of Public
Works to promulgate rules and regulations to regulate and control traffic on national
roads, this Court held:
In enacting said law, therefore, the National Assembly was prompted by
considerations of public convenience and welfare. It was inspired by a desire to
relieve congestion of traffic, which is, to say the least, a menace to public safety.
Public welfare, then, lies at the bottom of the enactment of said law, and the state in
order to promote the general welfare may interfere with personal liberty, with property,
and with business and occupations.20 (Emphasis supplied)
The questioned ordinances having been enacted with the objective of relieving traffic
congestion in the City of Lucena, they involve public interest warranting the
interference of the State. The first requisite for the proper exercise of police power is
thus present.
Respondents suggestion to have this Court look behind the explicit objective of the
ordinances which, to it, was actually to benefit the private interest of petitioner by
coercing all bus operators to patronize its terminal does not lie. 21 Lim v.
Pacquing22 instructs:
. . . [T]his Court cannot look into allegations that PD No. 771 was enacted to benefit a
select group which was later given authority to operate the jai-alai under PD No.
810. The examination of legislative motivation is generally prohibited. (Palmer v.
Thompson, 403 U.S. 217, 29 L. Ed. 2d 438 [1971] per Black, J.) There is, in the first
place, absolute lack of evidence to support ADCs allegation of improper motivation in
the issuance of PD No. 771. In the second place, as already averred, this Court
cannot go behind the expressed and proclaimed purposes of PD No. 771, which are
reasonable and even laudable. (Underscoring supplied)23
This leaves for determination the issue of whether the means employed by the Lucena
Sangguniang Panlungsod to attain its professed objective were reasonably necessary
and not unduly oppressive upon individuals.
With the aim of localizing the source of traffic congestion in the city to a single
location,24 the subject ordinances prohibit the operation of all bus and jeepney
terminals within Lucena, including those already existing, and allow the operation of
only one common terminal located outside the city proper, the franchise for which was
granted to petitioner. The common carriers plying routes to and from Lucena City are
thus compelled to close down their existing terminals and use the facilities of
petitioner.
In De la Cruz v. Paras,25 this Court declared unconstitutional an ordinance
characterized by overbreadth. In that case, the Municipality of Bocaue, Bulacan
prohibited the operation of all night clubs, cabarets and dance halls within its
jurisdiction for the protection of public morals. Held the Court:
It cannot be said that such a sweeping exercise of a lawmaking power by Bocaue coul
d qualify under the termreasonable. The objective of fostering public morals, a worthy
and desirable end can be attained by a measure thatdoes not encompass too wide a fi
eld. Certainly the ordinance on its face is characterized by overbreadth. Thepurpose s
ought to be achieved could have been attained by reasonable restrictions rather than
by an absoluteprohibition. The admonition in Salaveria should be heeded: "The
Judiciary should not lightly set aside legislative action when there is not a clear
invasion of personal or property rights under the guise of police regulation." It is clear
that in the guise of a police regulation, there was in this instance a clear invasion of
personal or property rights, personal in the case of those individuals desirous of
patronizing those night clubs and property in terms of the investments made and
salaries to be earned by those therein employed. (Underscoring supplied)26
In Lupangco v. Court of Appeals,27 this Court, in declaring unconstitutional the
resolution subject thereof, advanced a similar consideration. That case involved a
resolution issued by the Professional Regulation Commission which prohibited
examinees from attending review classes and receiving handout materials, tips, and
the like three days before the date of examination in order to preserve the integrity and
purity of the licensure examinations in accountancy. Besides being unreasonable on
its face and violative of academic freedom, the measure was found to be more
sweeping than what was necessary, viz:
Needless to say, the enforcement of Resolution No. 105 is not a guarantee that the
alleged leakages in the licensure examinations will be eradicated or at least
minimized. Making the examinees suffer by depriving them of legitimate means of
review or preparation on those last three precious days when they should be
refreshing themselves with all that they have learned in the review classes and
preparing their mental and psychological make-up for the examination day itself
would be like uprooting the tree to get rid of a rotten branch. What is needed to
be done by the respondent is to find out the source of such leakages and stop it
right there. If corrupt officials or personnel should be terminated from their loss, then
so be it. Fixers or swindlers should be flushed out. Strict guidelines to be observed by
examiners should be set up and if violations are committed, then licenses should be
suspended or revoked. x x x (Emphasis and underscoring supplied)28
As in De la Cruz29 and Lupangco,30 the ordinances assailed herein are characterized
by overbreadth. They go beyond what is reasonably necessary to solve the traffic
problem. Additionally, since the compulsory use of the terminal operated by petitioner
would subject the users thereof to fees, rentals and charges, such measure is unduly
oppressive, as correctly found by the appellate court. 31 What should have been done
was to determine exactly where the problem lies and then to stop it right there.
The true role of Constitutional Law is to effect an equilibrium between authority and
liberty so that rights are exercised within the framework of the law and the laws are
enacted with due deference to rights. (Underscoring supplied)32
A due deference to the rights of the individual thus requires a more careful formulation
of solutions to societal problems.
From the memorandum33 filed before this Court by petitioner, it is gathered that the
Sangguniang Panlungsod had identified the cause of traffic congestion to be the
indiscriminate loading and unloading of passengers by buses on the streets of the city
proper, hence, the conclusion that the terminals contributed to the proliferation of
buses obstructing traffic on the city streets.
Bus terminals per se do not, however, impede or help impede the flow of traffic. How
the outright proscription against the existence of all terminals, apart from that
franchised to petitioner, can be considered as reasonably necessary to solve the
traffic problem, this Court has not been enlightened. If terminals lack adequate space
such that bus drivers are compelled to load and unload passengers on the streets
instead of inside the terminals, then reasonable specifications for the size of terminals
could be instituted, with permits to operate the same denied those which are unable to
meet the specifications.
In the subject ordinances, however, the scope of the proscription against the
maintenance of terminals is so broad that even entities which might be able to provide
facilities better than the franchised terminal are barred from operating at all.
Petitioner argues, however, that other solutions for the traffic problem have already
been tried but proven ineffective. But the grant of an exclusive franchise to petitioner
has not been shown to be the only solution to the problem.
While the Sangguniang Panlungsod, via Ordinance No. 1557, 34 previously directed
bus owners and operators to put up their terminals "outside the poblacion of Lucena
City," petitioner informs that said ordinance only resulted in the relocation of terminals
to other well-populated barangays, thereby giving rise to traffic congestion in those
areas.35Assuming that information to be true, the Sangguniang Panlungsod was not
without remedy. It could have defined, among other considerations, in a more precise
manner, the area of relocation to avoid such consequences.
As for petitioners argument that the challenged ordinances were enacted pursuant to
the power of the Sangguniang Panlungsod to "[r]egulate traffic on all streets and
bridges; prohibit encroachments or obstacles thereon and, when necessary in the
interest of public welfare, authorize the removal of encroachments and illegal
constructions in public places":36 Absent any showing, nay allegation, that the
terminals are encroaching upon public roads, they are not obstacles. The buses which
indiscriminately load and unload passengers on the city streets are. The power then of
the Sangguniang Panlungsod to prohibit encroachments and obstacles does not
extend to terminals.1a\^/phi1.net
Neither are terminals public nuisances as petitioner argues. For their operation is a
legitimate business which, by itself, cannot be said to be injurious to the rights of
property, health, or comfort of the community.
But even assuming that terminals are nuisances due to their alleged indirect effects
upon the flow of traffic, at most they are nuisance per accidens, not per se.
Unless a thing is nuisance per se, however, it may not be abated via an ordinance,
without judicial proceedings, as was done in the case at bar.
In Estate of Gregoria Francisco v. Court of Appeals,37 this Court held:
Respondents can not seek cover under the general welfare clause authorizing the
abatement of nuisances without judicial proceedings. That tenet applies to a nuisance
per se, or one which affects the immediate safety of persons and property and may be
summarily abated under the undefined law of necessity (Monteverde v. Generoso, 52
Phil. 123 [1982]). The storage of copra in the quonset building is a legitimate business.
By its nature, it can not be said to be injurious to rights of property, of health or of
comfort of the community. If it be a nuisance per accidens it may be so proven in a
hearing conducted for that purpose. It is not per se a nuisance warranting its summary
abatement without judicial intervention.l^vvphi1.net (Underscoring
supplied)381awphi1.nt
In Pampanga Bus Co., Inc. v. Municipality of Tarlac 39 where the appellant-municipality
similarly argued that the terminal involved therein is a nuisance that may be abated by
the Municipal Council via an ordinance, this Court held: "Suffice it to say that in the
abatement of nuisances the provisions of the Civil Code (Articles 694-707) must be
observed and followed. This appellant failed to do."
As for petitioners claim that the challenged ordinances have actually been proven
effective in easing traffic congestion: Whether an ordinance is effective is an issue
different from whether it is reasonably necessary. It is itsreasonableness, not its
effectiveness, which bears upon its constitutionality. If the constitutionality of a law
were measured by its effectiveness, then even tyrannical laws may be justified
whenever they happen to be effective.
The Court is not unaware of the resolutions of various barangays in Lucena City
supporting the establishment of a common terminal, and similar expressions of
support from the private sector, copies of which were submitted to this Court by
petitioner. The weight of popular opinion, however, must be balanced with that of an
individuals rights.
There is no question that not even the strongest moral conviction or the most urgent
public need, subject only to a few notable exceptions, will excuse the bypassing of an
individual's rights. It is no exaggeration to say that a person invoking a right
guaranteed under Article III of the Constitution is a majority of one even as against the
rest of the nation who would deny him that right.40
WHEREFORE, the petition is hereby DENIED.
SO ORDERED.
EN BANC
G.R. No. L-24693 October 23, 1967
ERMITA-MALATE HOTEL AND MOTEL OPERATORS ASSOCIATION, INC.,
HOTEL DEL MAR, INC. and GO HIU, petitioners-appellees,
vs.
THE HONORABLE, CITY MAYOR OF MANILA, respondent-appellant.
VICTOR ALABANZA, intervenor-appellee.
J. M. Aruego, A. Tenchavez and L. U. Go for petitioners-appellees.
Panganiban, Abad and Associates for respondent-appellant.
RESOLUTION
FERNANDO, J.:
A Motion for the reconsideration of our decision of July 31, 1967 was filed by
petitioners, followed by a Motion for new trial. As the Motion for reconsideration is
clearly without merit, there is no occasion for this sought-for new trial. Consequently,
both motions are denied.
(1) No merit in the Motion for reconsideration.
In the decision of this Court of July 31, 1967, sought to be reconsidered, its basis was
categorically set forth in the following language:
As noted at the outset, the judgment must be reversed. A decent regard for
constitutional doctrines of a fundamental character ought to have
admonished the lower court against such a sweeping condemnation of the
challenged ordinance. Its decision cannot be allowed to stand, consistently
with what has hitherto been the accepted standards of constitutional
adjudication, in both procedural and substantive aspects.
Primarily what calls for a reversal of such a decision is the absence of any
evidence to offset the presumption of validity that attaches to a challenged
statute or ordinance. As was expressed categorically by Justice Malcolm:
"The presumption is all in favor of validity. . . . The action of the elected
representatives of the people cannot be lightly set aside. The councilors
must, in the very nature of things, be familiar with the necessities of their
particular municipality and with all the facts and circumstances which
surround the subject and necessitates action. The local legislative body, by
enacting the ordinance, has in effect given notice that the regulations are
essential to the well being of the people. . .. The Judiciary should not lightly
set aside legislative action when there is not a clear invasion of personal or
property rights under the guise of police regulation.
It admits of no doubt therefore that there being a presumption of validity, the
necessity for evidence to rebut it is unavoidable, unless the statute or
ordinance is void on its face, which is not the case here. The principle has
been nowhere better expressed than in the leading case of O'Gorman &
Young v. Hartford Fire Insurance Co., where the American Supreme Court
through Justice Brandeis tersely and succinctly summed up the matter thus:
"The statute here questioned deals with a subject clearly within the scope of
the police power. We are asked to declare it void on the ground that the
specific method of regulation prescribed is unreasonable and hence
deprives the plaintiff of due process of law. As underlying questions of fact
may condition the constitutionality of legislation of this character, the
presumption of constitutionality must prevail in the absence of some factual
foundation of record for overthrowing the statute." No such factual
foundation being laid in the present case, the lower court deciding the
matter on the pleadings and the stipulation of facts, the presumption of
validity must prevail and the judgment against the ordinance set aside.
The O'Gorman principle1 fails to meet the approval of counsel of petitioners. They
would restrain unduly and unjustifiably its operation. In the language of the motion for
reconsideration: "The U. S. Supreme Court was not laying down as a general rule in
constitutional cases that there must be a factual foundation of record to offset the
presumption of constitutionality of any and every law."
To paraphrase Justice Brandeis, this interpretation is without support in authority or
reason and rests upon a misconception. It is to betray an almost total lack of
awareness of the import and significance of the O'Gorman doctrine in American
constitutional law. Authorities on the subject of proven competence and knowledge
flatly reject such a view. Dodd,2 Dowling,3 Freund Sutherland, De Wolfe Howe, and
Brown,4 and Kauper5 in their standard casebooks quote the same excerpt from
O'Gorman v. Hartford Fire Ins. Co. appearing in the opinion of this Court. Dodd
entertained no doubt: "The accepted view is that stated by Mr. Justice Brandeis in the
O'Gorman case."6
Frankfurter and Landis were equally explicit in their appreciation of what the
O'Gorman dictum means. "As doctrine, there is nothing new in the avowal of a need
for concreteness in passing judgment upon the legislative judgment. But perhaps last
term marks a more sedulous attention to its observance. Certainly the procedure
followed by the Court in O'Gorman & Young v. Hartford Fire Ins. Co., if regularly
observed, will affect not a little the fate of legislation. If insisted upon, it will compel the
bar to argue questions of legislative validity in the perspective of the circumstances
which gave rise to a particular statute."7
The late Professor Hamilton of the Yale Law School, one of the most distinguished
constitutionalists, would have been appalled by the unorthodoxy of the view of counsel
of petitioners. For him, the O'Gorman opinion was a manifestation of the jurist's art at
its best:
If the jurists have the feelings of other men, Monday, the fifth of January
nineteen hundred and thirty one, must have been a day of consequence in
the life of Mr. Justice Brandeis. On that day he handed down the judgment
of the United States Supreme Court in the O'Gorman case. The cause was
a simple suit in contract: the result depended upon the validity of a New
Jersey statute regulating the commissions to be paid by insurance
companies to their agents for securing business. The more general question
was the tolerance to be accorded to legislative price-fixing under the
Fourteenth Amendment. And, as the fortunes of litigation broke, the issue
came to be the intellectual procedure by which the constitutionality of the
acts which make up the public control of business are to be determined.
Upon that day the views of Brandeis became "the opinion of the court," and
a new chapter in judicial history began to be written.
xxx xxx xxx
In form "the opinion of the court" is a very simple and unpretentious
document. It begins with a statement of the issue and a history of the case,
continues with a brief summary of the reasons for the statute and a
statement that "the business of insurance is so affected with a public
interest that the state may regulate the rates," and concludes with a
declaration of the test for validity. As "underlying questions of fact may
 condition the constitutionality of legislation of this character," it follows that
"the presumption of constitutionality must prevail in the absence of some
factual foundation of record for overthrowing the statute." It did not appear
"upon the face of the statute, or from any facts of which the court must take
judicial notice" that in New Jersey "evils did not exist," for which the statute
was "an appropriate remedy." Accordingly the court was compelled to
declare the statute valid; in fact it was left with no alternative.
Yet the simple lines of a short opinion present a superb example of the
jurist's art. . . .8
This is not to discount the possibility of a situation where the nullity of a statute,
executive order, or ordinance may not be readily apparent but the threat to
constitutional rights, especially those involving the freedom of the mind, present and
ominous. That in such an event there should not be a rigid insistence on the
requirement that evidence be presented does not argue against the force of the above
excerpts on the weight to be accorded the O'Gorman doctrine in this case.
The prop here failing, is there anything else in the Motion for reconsideration that calls
for a modification of the decision of this Court? The answer must be in the negative. It
ought not to have escaped petitioners that the opinion of the Court after noting the
lack of factual foundation to offset the presumption of constitutionality went on to
discuss the due process aspects to make clear that on its face, the Ordinance cannot
be considered void.
Nor may petitioners assert with plausibility that on its face the ordinance is
fatally defective as being repugnant to the due process clause of the
Constitution. The mantle of protection associated with the due process
guaranty does not cover petitioners. This particular manifestation of a police
power measure being specifically aimed to safeguard public morals is
immune from such imputation of nullity resting purely on conjecture and
unsupported by anything of substance. To hold otherwise would be to
unduly restrict and narrow the scope of police power which has been
properly characterized as the most essential, insistent and the least limitable
of powers, extending as it does "to all the great public needs." It would be,
to paraphrase another leading decision, to destroy the very purpose of the
state if it could be deprived or allowed itself to be deprived of its
competence to promote public health, public morals, public safety and the
general welfare. Negatively put, police power is "that inherent and plenary
power in the State which enables it to prohibit all that is hurtful to the
comfort, safety, and welfare of society."
There is no question but that the challenged ordinance was precisely
enacted to minimize certain practices hurtful to public morals. The
explanatory note of the then Councilor Herminio Astorga included as annex
to the stipulation of facts speaks of the alarming increase in the rate of
prostitution, adultery and fornication in Manila, traceable in great part to the
existence of motels, which "provide a necessary atmosphere for clandestine
entry, presence and exit" and thus become the "ideal haven for prostitutes
and thrill-seekers."
The challenged ordinance then proposes to check the clandestine harboring
of transients and guests of these establishments by requiring these
transients and guests to fill up a registration form, prepared for the purpose,
in a lobby open to public view at all times, and by introducing several other
amendatory provisions calculated to shatter the privacy that characterizes
the registration of transients and guests."
Moreover, the increase in the license fees was intended to discourage
"establishments of the kind from operating for purpose other than legal" and
at the same time, to increase "the income of the city government." It would
appear therefore that the stipulation of facts, far from sustaining any attack
against the validity of the ordinance, argues eloquently for it.
There is nothing in the Motion for reconsideration that in any wise affects adversely or
impairs the force of the above conclusion. The task of proving that the challenged
Ordinance is void on its face is one attended with difficulty. Nonetheless, with the
persistence worthy of a better cause, petitioners would cite as fatal infirmity the
alleged invasion of the rights against unreasonable search and seizure, to liberty, and
to property.
As the unchallenged rule, to paraphrase Laurel, is that unless a person is injuriously
affected in any of his constitutional rights by the operation of statute or ordinance,9 he
has no standing, the invocation of petitioners as motel operators of their alleged right
to being free from unreasonable search and seizure need not be taken seriously. Nor
does their claim of the alleged infringement of their liberty deserve any further thought,
its implausibility being self-evident, except perhaps as to the liberty to contract, which
is part and parcel of their right to the property. Unfortunately for them, in this
jurisdiction the liberty to contract, except in the Pomar10 case as noted in the decision,
has never stood in the way of the enactment of police power measures when called
for by circumstances such as undoubtedly exist in this case. The same is true in the
United States, where such a concept has definitely fallen from its previously high state
under the impact of the Nebbia,11 West Coast Hotel Co.12 and Olson decisions.13
That leaves only the alleged grievance that there was an unconstitutional invasion of
property rights. It goes without saying that petitioners themselves cannot ignore that
one could, consistently with the fundamental law, be deprived of his property as long
as due process is observed. The decision makes clear that such indeed was the case
as far as this Ordinance was concerned. To that aspect, a considerable portion of the
opinion was devoted, citing a number of applicable decisions of this Court, all tending
to demonstrate that there was no due process infraction. The Motion for
reconsideration is conspicuously barren of any attempt to show that under our
previous decisions referred to, the challenged Ordinance could be successfully
assailed. It would follow then that this reiteration of an argument, previously shown to
be far from persuasive, is deserving of a similar fate.
That is all there is to the Motion for reconsideration. That and what Justice Cardozo
aptly referred to as reference to "grotesque or fanciful situations," which if they would
arise could then be appropriately dealt with. As the famed jurist aptly noted: "That they
are conceivable though improbable ought not to govern our construction."14 That is not
the way then to impugn the validity of an ordinance. Neither could it be rightfully
looked upon as laying a foundation for setting aside a decision. The Motion for
reconsideration, to repeat, is palpably lacking in merit.
(1) No occasion for new trial.
Subsequently, a supplemental Motion for new trial dated September 25, 1967, was
filed the same day. As earlier pointed out, with the Motion for reconsideration having
been shown to be devoid of merit, the supplemental Motion for new trial should
likewise be denied. In the main, what was so unsuccessfully put forth by counsel for
petitioners was adhered to. Additional counsel would bring in new points, namely, the
alleged denial of equal protection and the repugnancy to "the laissez faire principle
underlying our economic system, as it would substantially reduce return on the
investment." Neither suffices to justify any modification of the decision, much less its
reconsideration. A new trial would therefore be an exercise in futility.
The alleged denial of equal protection was predicated on the greater advantages that
the motels in the suburbs of Manila would enjoy as against those within the city limits.
On its face, such argument is clearly unfounded. If the legislative power of the
Municipal Board of the City of Manila were not limited to its boundaries, if it could
apply to the suburban area, then perhaps plausibility could be imparted to such a
claim. Since, as is undeniable, the challenged Ordinance applies to all the motels in
Manila, an assertion that there is denial of equal protection would, to put it at its
mildest, be extremely far-fetched.
Nor does the invocation of the laissez faire concept as bar against the enactment of
regulatory measures, which undoubtedly would result in the diminution of income and
the loss of business, occasion any misgiving as to the conformity of the decision
arrived at by this Court with controlling constitutional law principles. Did not petitioners
take note of the view announced by Justice Laurel quoted in the decision to the effect
that the policy "of laissez fairehas to some extent given way to the assumption by the
government of the right of intervention even in contractual relations affected with
public interest." The decision likewise cited this jurist, speaking for the Court
in Calalang v. Williams:15 "Public welfare, then, lies at the bottom of the enactment of
said law, and the state in order to promote the general welfare may interfere with
personal liberty, with property, and with business and occupations. Perhaps and
property may be subjected to all kinds of restraints and burdens, in order to secure,
the general comfort, health, and prosperity of the state. . . . To this fundamental aim of
our Government the rights of the individual are subordinated." That was in 1940. Then
in 1955, came Co Kiam v. City of Manila,16 where Justice Reyes, A., for a unanimous
Court categorically declared: "And surely, the mere fact that some individuals in the
community may be deprived of their present business or a particular mode of earning
a living can not prevent the exercise of the police power. As was said in a case,
persons licensed to pursue occupations which may in the public need and interest be
affected by the exercise of the police power embark in those occupations subject to
the disadvantages which may result from the legal exercise of that power. (City of New
Orleans v. Stafford, 27 L. Ann. 417)."
Nor does the reference by new counsel to American state court decisions call for a
different conclusion. The United States Supreme Court in the leading case of West
Virginia State Board of Education v. Barnette,17 decided in 1943, was equally explicit,
saying "the laissez-faire concept or principle of non-interference has withered at least
as to economic affairs, and social advancements are increasingly sought through
closer integration of society and through expanded and strengthened governmental
controls." Two names of great repute, Freund and Learned Hand, were cited by
petitioners. Neither if properly understood, could help their cause at all. According to
Freund: "In short, when freedom of the mind is imperiled by law, it is freedom that
commands a momentum of respect, when property is imperiled, it is the lawmakers'
judgment that commands respect. This dual standard may not precisely reverse the
presumption of constitutionality in civil liberties cases, but obviously it does set up a
hierarchy of values within the due process clause."18 The illustrious Learned Hand
writing on Chief Justice Stone's concept of the judicial function had occasion to note
the "discredited attitude" of what he referred to "as the old apostles of the institution of
property. . . ."19
What then is left? Clearly nothing to call for the reconsideration of our decision of July
31, 1967. Nor is there the least justification for a new trial and reception of evidence.
WHEREFORE, the Motion for reconsideration of petitioners of September 16, 1967
and supplemental Motion for new trial of September 25, 1967, are denied.
EN BANC
G.R. No. 118127 April 12, 2005
CITY OF MANILA, HON. ALFREDO S. LIM as the Mayor of the City of Manila,
HON. JOSELITO L. ATIENZA, in his capacity as Vice-Mayor of the City of Manila
and Presiding Officer of the City Council of Manila, HON. ERNESTO A. NIEVA,
HON. GONZALO P. GONZALES, HON. AVELINO S. CAILIAN, HON. ROBERTO C.
OCAMPO, HON. ALBERTO DOMINGO, HON. HONORIO U. LOPEZ, HON.
FRANCISCO G. VARONA, JR., HON. ROMUALDO S. MARANAN, HON. NESTOR
C. PONCE, JR., HON. HUMBERTO B. BASCO, HON. FLAVIANO F. CONCEPCION,
JR., HON. ROMEO G. RIVERA, HON. MANUEL M. ZARCAL, HON. PEDRO S. DE
JESUS, HON. BERNARDITO C. ANG, HON. MANUEL L. QUIN, HON. JHOSEP Y.
LOPEZ, HON. CHIKA G. GO, HON. VICTORIANO A. MELENDEZ, HON. ERNESTO
V.P. MACEDA, JR., HON. ROLANDO P. NIETO, HON. DANILO V. ROLEDA, HON.
GERINO A. TOLENTINO, JR., HON. MA. PAZ E. HERRERA, HON. JOEY D. HIZON,
HON. FELIXBERTO D. ESPIRITU, HON. KARLO Q. BUTIONG, HON. ROGELIO P.
DELA PAZ, HON. BERNARDO D. RAGAZA, HON. MA. CORAZON R. CABALLES,
HON. CASIMIRO C. SISON, HON. BIENVINIDO M. ABANTE, JR., HON. MA.
LOURDES M. ISIP, HON. ALEXANDER S. RICAFORT, HON. ERNESTO F.
RIVERA, HON. LEONARDO L. ANGAT, and HON. JOCELYN B. DAWIS, in their
capacity as councilors of the City of Manila,Petitioner,
vs.
HON. PERFECTO A.S. LAGUIO, JR., as Presiding Judge, RTC, Manila and
MALATE TOURIST DEVELOPMENT CORPORATION, Respondents.
DECISION
TINGA, J.:
I know only that what is moral is what you feel good after and what is
immoral is what you feel bad after.
Ernest Hermingway
Death in the Afternoon, Ch. 1
It is a moral and political axiom that any dishonorable act, if performed by
oneself, is less immoral than if performed by someone else, who would be
well-intentioned in his dishonesty.
 J. Christopher Gerald 3. Karaoke Bars
Bonaparte in Egypt, Ch. I
4. Beerhouses
The Court's commitment to the protection of morals is secondary to its fealty to the
fundamental law of the land. It is foremost a guardian of the Constitution but not the 5. Night Clubs
conscience of individuals. And if it need be, the Court will not hesitate to "make the 6. Day Clubs
hammer fall, and heavily" in the words of Justice Laurel, and uphold the constitutional
guarantees when faced with laws that, though not lacking in zeal to promote morality, 7. Super Clubs
nevertheless fail to pass the test of constitutionality.
8. Discotheques
The pivotal issue in this Petition1 under Rule 45 (then Rule 42) of the Revised Rules
on Civil Procedure seeking the reversal of the Decision2 in Civil Case No. 93-66511 of 9. Cabarets
the Regional Trial Court (RTC) of Manila, Branch 18 (lower court),3 is the validity of 10. Dance Halls
Ordinance No. 7783 (the Ordinance) of the City of Manila.4
11. Motels
The antecedents are as follows:
12. Inns
Private respondent Malate Tourist Development Corporation (MTDC) is a corporation
engaged in the business of operating hotels, motels, hostels and lodging houses. 5 It SEC. 2 The City Mayor, the City Treasurer or any person acting in behalf
built and opened Victoria Court in Malate which was licensed as a motel although duly of the said officials are prohibited from issuing permits, temporary or
accredited with the Department of Tourism as a hotel. 6 On 28 June 1993, MTDC filed otherwise, or from granting licenses and accepting payments for the
a Petition for Declaratory Relief with Prayer for a Writ of Preliminary Injunction and/or operation of business enumerated in the preceding section.
Temporary Restraining Order7 (RTC Petition) with the lower court impleading as
SEC. 3. Owners and/or operator of establishments engaged in, or
defendants, herein petitioners City of Manila, Hon. Alfredo S. Lim (Lim), Hon. Joselito
L. Atienza, and the members of the City Council of Manila (City Council). MTDC devoted to, the businesses enumerated in Section 1 hereof are
hereby given three (3) months from the date of approval of this
prayed that the Ordinance, insofar as it includes motels and inns as among its
ordinance within which to wind up business operations or to transfer
prohibited establishments, be declared invalid and unconstitutional. 8
to any place outside of the Ermita-Malate area or convert said
Enacted by the City Council9 on 9 March 1993 and approved by petitioner City Mayor businesses to other kinds of business allowable within the area, such
on 30 March 1993, the saidOrdinance is entitled as but not limited to:

AN ORDINANCE PROHIBITING THE ESTABLISHMENT OR OPERATION 1. Curio or antique shop

OF BUSINESSES PROVIDING CERTAIN FORMS OF AMUSEMENT,
ENTERTAINMENT, SERVICES AND FACILITIES IN THE ERMITA- 2. Souvenir Shops
MALATE AREA, PRESCRIBING PENALTIES FOR VIOLATION THEREOF, 3. Handicrafts display centers
AND FOR OTHER PURPOSES.10
4. Art galleries
The Ordinance is reproduced in full, hereunder:
5. Records and music shops
SECTION 1. Any provision of existing laws and ordinances to the contrary
notwithstanding, no person, partnership, corporation or entity shall, in 6. Restaurants
the Ermita-Malate area bounded by Teodoro M. Kalaw Sr. Street in the
7. Coffee shops
North, Taft Avenue in the East, Vito Cruz Street in the South and Roxas
Boulevard in the West, pursuant to P.D. 499 be allowed or authorized to 8. Flower shops
contract and engage in, any business providing certain forms of
amusement, entertainment, services and facilities where women are 9. Music lounge and sing-along restaurants, with well-defined
used as tools in entertainment and which tend to disturb the activities for wholesome family entertainment that cater to both
community, annoy the inhabitants, and adversely affect the social and local and foreign clientele.
moral welfare of the community, such as but not limited to:
10. Theaters engaged in the exhibition, not only of motion pictures
1. Sauna Parlors but also of cultural shows, stage and theatrical plays, art
exhibitions, concerts and the like.
2. Massage Parlors
 11. Businesses allowable within the law and medium intensity
districts as provided for in the zoning ordinances for Metropolitan
Manila, except new warehouse or open-storage depot, dock or
yard, motor repair shop, gasoline service station, light industry
with any machinery, or funeral establishments.
SEC. 4. Any person violating any provisions of this ordinance, shall
upon conviction, be punished by imprisonment of one (1) year or fine
of FIVE THOUSAND (P5,000.00) PESOS, or both, at the discretion of the
Court, PROVIDED, that in case of juridical person, the President, the
General Manager, or person-in-charge of operation shall be liable thereof;
PROVIDED FURTHER, that in case of subsequent violation and
conviction, the premises of the erring establishment shall be closed
and padlocked permanently.
SEC. 5. This ordinance shall take effect upon approval.
Enacted by the City Council of Manila at its regular session today, March 9,
1993.
Approved by His Honor, the Mayor on March 30, 1993. (Emphasis supplied)
In the RTC Petition, MTDC argued that the Ordinance erroneously and improperly
included in its enumeration of prohibited establishments, motels and inns such as
MTDC's Victoria Court considering that these were not establishments for
"amusement" or "entertainment" and they were not "services or facilities for
entertainment," nor did they use women as "tools for entertainment," and neither did
they "disturb the community," "annoy the inhabitants" or "adversely affect the social
and moral welfare of the community."11
MTDC further advanced that the Ordinance was invalid and unconstitutional for the
following reasons: (1) The City Council has no power to prohibit the operation of
motels as Section 458 (a) 4 (iv)12 of the Local Government Code of 1991 (the Code)
grants to the City Council only the power to regulate the establishment, operation and
maintenance of hotels, motels, inns, pension houses, lodging houses and other similar
establishments; (2) The Ordinance is void as it is violative of Presidential Decree
(P.D.) No. 49913 which specifically declared portions of the Ermita-Malate area as a
commercial zone with certain restrictions; (3) The Ordinance does not constitute a
proper exercise of police power as the compulsory closure of the motel business has
no reasonable relation to the legitimate municipal interests sought to be protected; (4)
The Ordinance constitutes an ex post facto law by punishing the operation of Victoria
Court which was a legitimate business prior to its enactment; (5)
The Ordinanceviolates MTDC's constitutional rights in that: (a) it is confiscatory and
constitutes an invasion of plaintiff's property rights; (b) the City Council has no power
to find as a fact that a particular thing is a nuisance per se nor does it have the power
to extrajudicially destroy it; and (6) The Ordinance constitutes a denial of equal
protection under the law as no reasonable basis exists for prohibiting the operation of
motels and inns, but not pension houses, hotels, lodging houses or other similar
establishments, and for prohibiting said business in the Ermita-Malate area but not
outside of this area.14
In their Answer15 dated 23 July 1993, petitioners City of Manila and Lim maintained
that the City Council had the power to "prohibit certain forms of entertainment in order
to protect the social and moral welfare of the community" as provided for in Section
458 (a) 4 (vii) of the Local Government Code,16 which reads, thus:
Section 458. Powers, Duties, Functions and Compensation. (a) The
sangguniang panlungsod, as the legislative body of the city, shall enact
ordinances, approve resolutions and appropriate funds for the general
welfare of the city and its inhabitants pursuant to Section 16 of this Code
and in the proper exercise of the corporate powers of the city as provided
for under Section 22 of this Code, and shall:
....
(4) Regulate activities relative to the use of land, buildings and structures
within the city in order to promote the general welfare and for said purpose
shall:
....
(vii) Regulate the establishment, operation, and maintenance of
any entertainment or amusement facilities, including theatrical
performances, circuses, billiard pools, public dancing schools,
public dance halls, sauna baths, massage parlors, and other
places for entertainment or amusement; regulate such other
events or activities for amusement or entertainment, particularly
those which tend to disturb the community or annoy the
inhabitants, or require the suspension or suppression of the
same; or, prohibit certain forms of amusement or entertainment in
order to protect the social and moral welfare of the community.
Citing Kwong Sing v. City of Manila,17 petitioners insisted that the power of regulation
spoken of in the above-quoted provision included the power to control, to govern and
to restrain places of exhibition and amusement.18
Petitioners likewise asserted that the Ordinance was enacted by the City Council of
Manila to protect the social and moral welfare of the community in conjunction with its
police power as found in Article III, Section 18(kk) of Republic Act No. 409, 19 otherwise
known as the Revised Charter of the City of Manila (Revised Charter of
Manila)20 which reads, thus:
ARTICLE III
THE MUNICIPAL BOARD
. . .
Section 18. Legislative powers. The Municipal Board shall have the
following legislative powers:
. . .
(kk) To enact all ordinances it may deem necessary and proper for the
sanitation and safety, the furtherance of the prosperity, and the promotion of
the morality, peace, good order, comfort, convenience, and general welfare
of the city and its inhabitants, and such others as may be necessary to carry
into effect and discharge the powers and duties conferred by this chapter;
 and to fix penalties for the violation of ordinances which shall not exceed
two hundred pesos fine or six months' imprisonment, or both such fine and
imprisonment, for a single offense.
Further, the petitioners noted, the Ordinance had the presumption of validity; hence,
private respondent had the burden to prove its illegality or unconstitutionality.21
Petitioners also maintained that there was no inconsistency between P.D. 499 and
the Ordinance as the latter simply disauthorized certain forms of businesses and
allowed the Ermita-Malate area to remain a commercial zone.22 The Ordinance, the
petitioners likewise claimed, cannot be assailed as ex post facto as it was prospective
in operation.23 The Ordinance also did not infringe the equal protection clause and
cannot be denounced as class legislation as there existed substantial and real
differences between the Ermita-Malate area and other places in the City of Manila.24
On 28 June 1993, respondent Judge Perfecto A.S. Laguio, Jr. (Judge Laguio) issued
an ex-parte temporary restraining order against the enforcement of
the Ordinance.25 And on 16 July 1993, again in an intrepid gesture, he granted the writ
of preliminary injunction prayed for by MTDC.26
After trial, on 25 November 1994, Judge Laguio rendered the assailed Decision,
enjoining the petitioners from implementing the Ordinance. The dispositive portion of
said Decision reads:27
WHEREFORE, judgment is hereby rendered declaring Ordinance No.
778[3], Series of 1993, of the City of Manila null and void, and making
permanent the writ of preliminary injunction that had been issued by this
Court against the defendant. No costs.
SO ORDERED.28
29
Petitioners filed with the lower court a Notice of Appeal on 12 December 1994,
manifesting that they are elevating the case to this Court under then Rule 42 on pure
questions of law.30
On 11 January 1995, petitioners filed the present Petition, alleging that the following
errors were committed by the lower court in its ruling: (1) It erred in concluding that the
subject ordinance is ultra vires, or otherwise, unfair, unreasonable and oppressive
exercise of police power; (2) It erred in holding that the
questioned Ordinancecontravenes P.D. 49931 which allows operators of all kinds of
commercial establishments, except those specified therein; and (3) It erred in
declaring the Ordinance void and unconstitutional.32
In the Petition and in its Memorandum,33 petitioners in essence repeat the assertions
they made before the lower court. They contend that the assailed Ordinance was
enacted in the exercise of the inherent and plenary power of the State and the general
welfare clause exercised by local government units provided for in Art. 3, Sec. 18 (kk)
of the Revised Charter of Manila and conjunctively, Section 458 (a) 4 (vii) of the
Code.34 They allege that theOrdinance is a valid exercise of police power; it does not
contravene P.D. 499; and that it enjoys the presumption of validity. 35
In its Memorandum36 dated 27 May 1996, private respondent maintains that
the Ordinance is ultra vires and that it is void for being repugnant to the general law. It
reiterates that the questioned Ordinance is not a valid exercise of police power; that it
is violative of due process, confiscatory and amounts to an arbitrary interference with
its lawful business; that it is violative of the equal protection clause; and that it confers
on petitioner City Mayor or any officer unregulated discretion in the execution of
the Ordinance absent rules to guide and control his actions.
This is an opportune time to express the Court's deep sentiment and tenderness for
the Ermita-Malate area being its home for several decades. A long-time resident, the
Court witnessed the area's many turn of events. It relished its glory days and endured
its days of infamy. Much as the Court harks back to the resplendent era of the Old
Manila and yearns to restore its lost grandeur, it believes that the Ordinance is not the
fitting means to that end. The Court is of the opinion, and so holds, that the lower
court did not err in declaring the Ordinance, as it did, ultra vires and therefore null and
void.
The Ordinance is so replete with constitutional infirmities that almost every sentence
thereof violates a constitutional provision. The prohibitions and sanctions therein
transgress the cardinal rights of persons enshrined by the Constitution. The Court is
called upon to shelter these rights from attempts at rendering them worthless.
The tests of a valid ordinance are well established. A long line of decisions has held
that for an ordinance to be valid, it must not only be within the corporate powers of the
local government unit to enact and must be passed according to the procedure
prescribed by law, it must also conform to the following substantive requirements: (1)
must not contravene the Constitution or any statute; (2) must not be unfair or
oppressive; (3) must not be partial or discriminatory; (4) must not prohibit but may
regulate trade; (5) must be general and consistent with public policy; and (6) must not
be unreasonable.37
Anent the first criterion, ordinances shall only be valid when they are not contrary to
the Constitution and to the laws.38 The Ordinance must satisfy two requirements: it
must pass muster under the test of constitutionality and the test of consistency with
the prevailing laws. That ordinances should be constitutional uphold the principle of
the supremacy of the Constitution. The requirement that the enactment must not
violate existing law gives stress to the precept that local government units are able to
legislate only by virtue of their derivative legislative power, a delegation of legislative
power from the national legislature. The delegate cannot be superior to the principal
or exercise powers higher than those of the latter.39
This relationship between the national legislature and the local government units has
not been enfeebled by the new provisions in the Constitution strengthening the policy
of local autonomy. The national legislature is still the principal of the local government
units, which cannot defy its will or modify or violate it.40
The Ordinance was passed by the City Council in the exercise of its police power, an
enactment of the City Council acting as agent of Congress. Local government units,
as agencies of the State, are endowed with police power in order to effectively
accomplish and carry out the declared objects of their creation. 41 This delegated police
power is found in Section 16 of the Code, known as the general welfare clause, viz:
SECTION 16. General Welfare.Every local government unit shall exercise
the powers expressly granted, those necessarily implied therefrom, as well
as powers necessary, appropriate, or incidental for its efficient and effective
governance, and those which are essential to the promotion of the general
 welfare. Within their respective territorial jurisdictions, local government
units shall ensure and support, among other things, the preservation and
enrichment of culture, promote health and safety, enhance the right of the
people to a balanced ecology, encourage and support the development of
appropriate and self-reliant scientific and technological capabilities, improve
public morals, enhance economic prosperity and social justice, promote full
employment among their residents, maintain peace and order, and preserve
the comfort and convenience of their inhabitants.
Local government units exercise police power through their respective legislative
bodies; in this case, thesangguniang panlungsod or the city council. The Code
empowers the legislative bodies to "enact ordinances, approve resolutions and
appropriate funds for the general welfare of the province/city/municipality and its
inhabitants pursuant to Section 16 of the Code and in the proper exercise of the
corporate powers of the province/city/ municipality provided under the Code.42 The
inquiry in this Petition is concerned with the validity of the exercise of such delegated
power.
The Ordinance contravenes
the Constitution
The police power of the City Council, however broad and far-reaching, is subordinate
to the constitutional limitations thereon; and is subject to the limitation that its exercise
must be reasonable and for the public good.43 In the case at bar, the enactment of
the Ordinance was an invalid exercise of delegated power as it is unconstitutional and
repugnant to general laws.
The relevant constitutional provisions are the following:
SEC. 5. The maintenance of peace and order, the protection of life, liberty,
and property, and the promotion of the general welfare are essential for the
enjoyment by all the people of the blessings of democracy.44
SEC. 14. The State recognizes the role of women in nation-building, and
shall ensure the fundamental equality before the law of women and men. 45
SEC. 1. No person shall be deprived of life, liberty or property without due
process of law, nor shall any person be denied the equal protection of
laws.46
Sec. 9. Private property shall not be taken for public use without just
compensation.47
A. The Ordinance infringes
the Due Process Clause
The constitutional safeguard of due process is embodied in the fiat "(N)o person shall
be deprived of life, liberty or property without due process of law. . . ." 48
There is no controlling and precise definition of due process. It furnishes though a
standard to which governmental action should conform in order that deprivation of life,
liberty or property, in each appropriate case, be valid. This standard is aptly described
as a responsiveness to the supremacy of reason, obedience to the dictates of
justice,49and as such it is a limitation upon the exercise of the police power.50
The purpose of the guaranty is to prevent governmental encroachment against the life,
liberty and property of individuals; to secure the individual from the arbitrary exercise
of the powers of the government, unrestrained by the established principles of private
rights and distributive justice; to protect property from confiscation by legislative
enactments, from seizure, forfeiture, and destruction without a trial and conviction by
the ordinary mode of judicial procedure; and to secure to all persons equal and
impartial justice and the benefit of the general law.51
The guaranty serves as a protection against arbitrary regulation, and private
corporations and partnerships are "persons" within the scope of the guaranty insofar
as their property is concerned.52
This clause has been interpreted as imposing two separate limits on government,
usually called "procedural due process" and "substantive due process."
Procedural due process, as the phrase implies, refers to the procedures that the
government must follow before it deprives a person of life, liberty, or property. Classic
procedural due process issues are concerned with what kind of notice and what form
of hearing the government must provide when it takes a particular action.53
Substantive due process, as that phrase connotes, asks whether the government has
an adequate reason for taking away a person's life, liberty, or property. In other words,
substantive due process looks to whether there is a sufficient justification for the
government's action.54 Case law in the United States (U.S.) tells us that whether there
is such a justification depends very much on the level of scrutiny used. 55 For example,
if a law is in an area where only rational basis review is applied, substantive due
process is met so long as the law is rationally related to a legitimate government
purpose. But if it is an area where strict scrutiny is used, such as for protecting
fundamental rights, then the government will meet substantive due process only if it
can prove that the law is necessary to achieve a compelling government purpose. 56
The police power granted to local government units must always be exercised with
utmost observance of the rights of the people to due process and equal protection of
the law. Such power cannot be exercised whimsically, arbitrarily or despotically57 as its
exercise is subject to a qualification, limitation or restriction demanded by the respect
and regard due to the prescription of the fundamental law, particularly those forming
part of the Bill of Rights. Individual rights, it bears emphasis, may be adversely
affected only to the extent that may fairly be required by the legitimate demands of
public interest or public welfare.58 Due process requires the intrinsic validity of the law
in interfering with the rights of the person to his life, liberty and property. 59
Requisites for the valid exercise
of Police Power are not met
To successfully invoke the exercise of police power as the rationale for the enactment
of the Ordinance, and to free it from the imputation of constitutional infirmity, not only
must it appear that the interests of the public generally, as distinguished from those of
a particular class, require an interference with private rights, but the means adopted
must be reasonably necessary for the accomplishment of the purpose and not unduly
oppressive upon individuals.60 It must be evident that no other alternative for the
accomplishment of the purpose less intrusive of private rights can work. A reasonable
relation must exist between the purposes of the police measure and the means
employed for its accomplishment, for even under the guise of protecting the public
interest, personal rights and those pertaining to private property will not be permitted
to be arbitrarily invaded.61
Lacking a concurrence of these two requisites, the police measure shall be struck
down as an arbitrary intrusion into private rights62 a violation of the due process
clause.
The Ordinance was enacted to address and arrest the social ills purportedly spawned
by the establishments in the Ermita-Malate area which are allegedly operated under
the deceptive veneer of legitimate, licensed and tax-paying nightclubs, bars, karaoke
bars, girlie houses, cocktail lounges, hotels and motels. Petitioners insist that even
the Court in the case of Ermita-Malate Hotel and Motel Operators Association, Inc. v.
City Mayor of Manila63 had already taken judicial notice of the "alarming increase in
the rate of prostitution, adultery and fornication in Manila traceable in great part to
existence of motels, which provide a necessary atmosphere for clandestine entry,
presence and exit and thus become the ideal haven for prostitutes and thrill-
seekers."64
The object of the Ordinance was, accordingly, the promotion and protection of the
social and moral values of the community. Granting for the sake of argument that the
objectives of the Ordinance are within the scope of the City Council's police powers,
the means employed for the accomplishment thereof were unreasonable and unduly
oppressive.
It is undoubtedly one of the fundamental duties of the City of Manila to make all
reasonable regulations looking to the promotion of the moral and social values of the
community. However, the worthy aim of fostering public morals and the eradication of
the community's social ills can be achieved through means less restrictive of private
rights; it can be attained by reasonable restrictions rather than by an absolute
prohibition. The closing down and transfer of businesses or their conversion into
businesses "allowed" under the Ordinance have no reasonable relation to the
accomplishment of its purposes. Otherwise stated, the prohibition of the enumerated
establishments will not per seprotect and promote the social and moral welfare of the
community; it will not in itself eradicate the alluded social ills of prostitution, adultery,
fornication nor will it arrest the spread of sexual disease in Manila.
Conceding for the nonce that the Ermita-Malate area teems with houses of ill-repute
and establishments of the like which the City Council may lawfully prohibit, 65 it is
baseless and insupportable to bring within that classification sauna parlors, massage
parlors, karaoke bars, night clubs, day clubs, super clubs, discotheques, cabarets,
dance halls, motels and inns. This is not warranted under the accepted definitions of
these terms. The enumerated establishments are lawful pursuits which are not per
se offensive to the moral welfare of the community.
That these are used as arenas to consummate illicit sexual affairs and as venues to
further the illegal prostitution is of no moment. We lay stress on the acrid truth that
sexual immorality, being a human frailty, may take place in the most innocent of
places that it may even take place in the substitute establishments enumerated under
Section 3 of the Ordinance. If the flawed logic of the Ordinance were to be followed,
in the remote instance that an immoral sexual act transpires in a church cloister or a
court chamber, we would behold the spectacle of the City of Manila ordering the
closure of the church or court concerned. Every house, building, park, curb, street or
even vehicles for that matter will not be exempt from the prohibition. Simply because
there are no "pure" places where there are impure men. Indeed, even the Scripture
and the Tradition of Christians churches continually recall the presence
anduniversality of sin in man's history.66
The problem, it needs to be pointed out, is not the establishment, which by its nature
cannot be said to be injurious to the health or comfort of the community and which in
itself is amoral, but the deplorable human activity that may occur within its premises.
While a motel may be used as a venue for immoral sexual activity, it cannot for that
reason alone be punished. It cannot be classified as a house of ill-repute or as a
nuisance per se on a mere likelihood or a naked assumption. If that were so and if that
were allowed, then the Ermita-Malate area would not only be purged of its supposed
social ills, it would be extinguished of its soul as well as every human activity,
reprehensible or not, in its every nook and cranny would be laid bare to the estimation
of the authorities.
The Ordinance seeks to legislate morality but fails to address the core issues of
morality. Try as the Ordinance may to shape morality, it should not foster the illusion
that it can make a moral man out of it because immorality is not a thing, a building or
establishment; it is in the hearts of men. The City Council instead should regulate
human conduct that occurs inside the establishments, but not to the detriment of
liberty and privacy which are covenants, premiums and blessings of democracy.
While petitioners' earnestness at curbing clearly objectionable social ills is
commendable, they unwittingly punish even the proprietors and operators of
"wholesome," "innocent" establishments. In the instant case, there is a clear invasion
of personal or property rights, personal in the case of those individuals desirous of
owning, operating and patronizing those motels and property in terms of the
investments made and the salaries to be paid to those therein employed. If the City of
Manila so desires to put an end to prostitution, fornication and other social ills, it can
instead impose reasonable regulations such as daily inspections of the establishments
for any violation of the conditions of their licenses or permits; it may exercise its
authority to suspend or revoke their licenses for these violations; 67 and it may even
impose increased license fees. In other words, there are other means to reasonably
accomplish the desired end.
Means employed are
constitutionally infirm
The Ordinance disallows the operation of sauna parlors, massage parlors, karaoke
bars, beerhouses, night clubs, day clubs, super clubs, discotheques, cabarets, dance
halls, motels and inns in the Ermita-Malate area. In Section 3 thereof, owners and/or
operators of the enumerated establishments are given three (3) months from the date
of approval of the Ordinance within which "to wind up business operations or to
transfer to any place outside the Ermita-Malate area or convert said businesses to
other kinds of business allowable within the area." Further, it states in Section 4 that in
cases of subsequent violations of the provisions of the Ordinance, the "premises of
the erring establishment shall be closed and padlocked permanently."
It is readily apparent that the means employed by the Ordinance for the achievement
of its purposes, the governmental interference itself, infringes on the constitutional
guarantees of a person's fundamental right to liberty and property.
Liberty as guaranteed by the Constitution was defined by Justice Malcolm to include
"the right to exist and the right to be free from arbitrary restraint or servitude. The term
cannot be dwarfed into mere freedom from physical restraint of the person of the
citizen, but is deemed to embrace the right of man to enjoy the facilities with which he
has been endowed by his Creator, subject only to such restraint as are necessary for
the common welfare."68 In accordance with this case, the rights of the citizen to be free
to use his faculties in all lawful ways; to live and work where he will; to earn his
livelihood by any lawful calling; and to pursue any avocation are all deemed embraced
in the concept of liberty.69
The U.S. Supreme Court in the case of Roth v. Board of Regents,70 sought to clarify
the meaning of "liberty." It said:
While the Court has not attempted to define with exactness the liberty. . .
guaranteed [by the Fifth and Fourteenth Amendments], the term denotes
not merely freedom from bodily restraint but also the right of the individual to
contract, to engage in any of the common occupations of life, to acquire
useful knowledge, to marry, establish a home and bring up children, to
worship God according to the dictates of his own conscience, and generally
to enjoy those privileges long recognizedas essential to the orderly pursuit
of happiness by free men. In a Constitution for a free people, there can be
no doubt that the meaning of "liberty" must be broad indeed.
In another case, it also confirmed that liberty protected by the due process clause
includes personal decisions relating to marriage, procreation, contraception, family
relationships, child rearing, and education. In explaining the respect the Constitution
demands for the autonomy of the person in making these choices, the U.S. Supreme
Court explained:
These matters, involving the most intimate and personal choices a person
may make in a lifetime, choices central to personal dignity and autonomy,
are central to the liberty protected by the Fourteenth Amendment. At the
heart of liberty is the right to define one's own concept of existence, of
meaning, of universe, and of the mystery of human life. Beliefs about these
matters could not define the attributes of personhood where they formed
under compulsion of the State.71
Persons desirous to own, operate and patronize the enumerated establishments
under Section 1 of the Ordinancemay seek autonomy for these purposes.
Motel patrons who are single and unmarried may invoke this right to autonomy to
consummate their bonds in intimate sexual conduct within the motel's premisesbe it
stressed that their consensual sexual behavior does not contravene any fundamental
state policy as contained in the Constitution. 72 Adults have a right to choose to forge
such relationships with others in the confines of their own private lives and still retain
their dignity as free persons. The liberty protected by the Constitution allows persons
the right to make this choice.73 Their right to liberty under the due process clause
gives them the full right to engage in their conduct without intervention of the
government, as long as they do not run afoul of the law. Liberty should be the rule and
restraint the exception.
Liberty in the constitutional sense not only means freedom from unlawful government
restraint; it must include privacy as well, if it is to be a repository of freedom. The right
to be let alone is the beginning of all freedomit is the most comprehensive of rights
and the right most valued by civilized men.74
The concept of liberty compels respect for the individual whose claim to privacy and
interference demands respect. As the case of Morfe v. Mutuc,75 borrowing the words
of Laski, so very aptly stated:
Man is one among many, obstinately refusing reduction to unity. His
separateness, his isolation, are indefeasible; indeed, they are so
fundamental that they are the basis on which his civic obligations are built.
He cannot abandon the consequences of his isolation, which are, broadly
speaking, that his experience is private, and the will built out of that
experience personal to himself. If he surrenders his will to others, he
surrenders himself. If his will is set by the will of others, he ceases to be a
master of himself. I cannot believe that a man no longer a master of himself
is in any real sense free.
Indeed, the right to privacy as a constitutional right was recognized in Morfe, the
invasion of which should be justified by a compelling state interest. Morfe accorded
recognition to the right to privacy independently of its identification with liberty; in itself
it is fully deserving of constitutional protection. Governmental powers should stop
short of certain intrusions into the personal life of the citizen. 76
There is a great temptation to have an extended discussion on these civil liberties but
the Court chooses to exercise restraint and restrict itself to the issues presented when
it should. The previous pronouncements of the Court are not to be interpreted as a
license for adults to engage in criminal conduct. The reprehensibility of such conduct
is not diminished. The Court only reaffirms and guarantees their right to make this
choice. Should they be prosecuted for their illegal conduct, they should suffer the
consequences of the choice they have made. That, ultimately, is their choice.
Modality employed is
unlawful taking
In addition, the Ordinance is unreasonable and oppressive as it substantially divests
the respondent of the beneficial use of its property. 77 The Ordinance in Section 1
thereof forbids the running of the enumerated businesses in the Ermita-Malate area
and in Section 3 instructs its owners/operators to wind up business operations or to
transfer outside the area or convert said businesses into allowed businesses. An
ordinance which permanently restricts the use of property that it can not be used for
any reasonable purpose goes beyond regulation and must be recognized as a taking
of the property without just compensation.78 It is intrusive and violative of the private
property rights of individuals.
The Constitution expressly provides in Article III, Section 9, that "private property shall
not be taken for public use without just compensation." The provision is the most
important protection of property rights in the Constitution. This is a restriction on the
general power of the government to take property. The constitutional provision is
about ensuring that the government does not confiscate the property of some to give it
to others. In part too, it is about loss spreading. If the government takes away a
person's property to benefit society, then society should pay. The principal purpose of
the guarantee is "to bar the Government from forcing some people alone to bear
public burdens which, in all fairness and justice, should be borne by the public as a
whole.79
There are two different types of taking that can be identified. A "possessory" taking
occurs when the government confiscates or physically occupies property. A
"regulatory" taking occurs when the government's regulation leaves no reasonable
economically viable use of the property.80
In the landmark case of Pennsylvania Coal v. Mahon,81 it was held that a taking also
could be found if government regulation of the use of property went "too far." When
regulation reaches a certain magnitude, in most if not in all cases there must be an
exercise of eminent domain and compensation to support the act. While property may
be regulated to a certain extent, if regulation goes too far it will be recognized as a
taking.82
No formula or rule can be devised to answer the questions of what is too far and when
regulation becomes a taking. In Mahon, Justice Holmes recognized that it was "a
question of degree and therefore cannot be disposed of by general propositions." On
many other occasions as well, the U.S. Supreme Court has said that the issue of
when regulation constitutes a taking is a matter of considering the facts in each case.
The Court asks whether justice and fairness require that the economic loss caused by
public action must be compensated by the government and thus borne by the public
as a whole, or whether the loss should remain concentrated on those few persons
subject to the public action.83
What is crucial in judicial consideration of regulatory takings is that government
regulation is a taking if it leaves no reasonable economically viable use of property in
a manner that interferes with reasonable expectations for use.84A regulation that
permanently denies all economically beneficial or productive use of land is, from the
owner's point of view, equivalent to a "taking" unless principles of nuisance or property
law that existed when the owner acquired the land make the use prohibitable. 85 When
the owner of real property has been called upon to sacrifice all economically beneficial
uses in the name of the common good, that is, to leave his property economically idle,
he has suffered a taking.86
A regulation which denies all economically beneficial or productive use of land will
require compensation under the takings clause. Where a regulation places limitations
on land that fall short of eliminating all economically beneficial use, a taking
nonetheless may have occurred, depending on a complex of factors including the
regulation's economic effect on the landowner, the extent to which the regulation
interferes with reasonable investment-backed expectations and the character of
government action. These inquiries are informed by the purpose of the takings clause
which is to prevent the government from forcing some people alone to bear public
burdens which, in all fairness and justice, should be borne by the public as a whole.87
A restriction on use of property may also constitute a "taking" if not reasonably
necessary to the effectuation of a substantial public purpose or if it has an unduly
harsh impact on the distinct investment-backed expectations of the owner.88
The Ordinance gives the owners and operators of the "prohibited" establishments
three (3) months from its approval within which to "wind up business operations or to
transfer to any place outside of the Ermita-Malate area or convert said businesses to
other kinds of business allowable within the area." The directive to "wind up business
operations" amounts to a closure of the establishment, a permanent deprivation of
property, and is practically confiscatory. Unless the owner converts his establishment
to accommodate an "allowed" business, the structure which housed the previous
business will be left empty and gathering dust. Suppose he transfers it to another
area, he will likewise leave the entire establishment idle. Consideration must be given
to the substantial amount of money invested to build the edifices which the owner
reasonably expects to be returned within a period of time. It is apparent that
theOrdinance leaves no reasonable economically viable use of property in a manner
that interferes with reasonable expectations for use.
The second and third options to transfer to any place outside of the Ermita-Malate
area or to convert into allowed businessesare confiscatory as well. The penalty of
permanent closure in cases of subsequent violations found in Section 4 of
the Ordinance is also equivalent to a "taking" of private property.
The second option instructs the owners to abandon their property and build another
one outside the Ermita-Malate area. In every sense, it qualifies as a taking without
just compensation with an additional burden imposed on the owner to build another
establishment solely from his coffers. The proffered solution does not put an end to
the "problem," it merely relocates it. Not only is this impractical, it is unreasonable,
onerous and oppressive. The conversion into allowed enterprises is just as ridiculous.
How may the respondent convert a motel into a restaurant or a coffee shop, art gallery
or music lounge without essentially destroying its property? This is a taking of private
property without due process of law, nay, even without compensation.
The penalty of closure likewise constitutes unlawful taking that should be
compensated by the government. The burden on the owner to convert or transfer his
business, otherwise it will be closed permanently after a subsequent violation should
be borne by the public as this end benefits them as a whole.
Petitioners cannot take refuge in classifying the measure as a zoning ordinance. A
zoning ordinance, although a valid exercise of police power, which limits a
"wholesome" property to a use which can not reasonably be made of it constitutes the
taking of such property without just compensation. Private property which is not
noxious nor intended for noxious purposes may not, by zoning, be destroyed without
compensation. Such principle finds no support in the principles of justice as we know
them. The police powers of local government units which have always received broad
and liberal interpretation cannot be stretched to cover this particular taking.
Distinction should be made between destruction from necessity and eminent domain.
It needs restating that the property taken in the exercise of police power is destroyed
because it is noxious or intended for a noxious purpose while the property taken under
the power of eminent domain is intended for a public use or purpose and is therefore
"wholesome."89 If it be of public benefit that a "wholesome" property remain unused or
relegated to a particular purpose, then certainly the public should bear the cost of
reasonable compensation for the condemnation of private property for public use. 90
Further, the Ordinance fails to set up any standard to guide or limit the petitioners'
actions. It in no way controls or guides the discretion vested in them. It provides no
definition of the establishments covered by it and it fails to set forth the conditions
when the establishments come within its ambit of prohibition. The Ordinance confers
upon the mayor arbitrary and unrestricted power to close down establishments.
Ordinances such as this, which make possible abuses in its execution, depending
upon no conditions or qualifications whatsoever other than the unregulated arbitrary
will of the city authorities as the touchstone by which its validity is to be tested, are
unreasonable and invalid. The Ordinance should have established a rule by which its
impartial enforcement could be secured.91
Ordinances placing restrictions upon the lawful use of property must, in order to be
valid and constitutional, specify the rules and conditions to be observed and conduct
to avoid; and must not admit of the exercise, or of an opportunity for the exercise, of
unbridled discretion by the law enforcers in carrying out its provisions. 92
Thus, in Coates v. City of Cincinnati,93 as cited in People v. Nazario,94 the U.S.
Supreme Court struck down an ordinance that had made it illegal for "three or more
persons to assemble on any sidewalk and there conduct themselves in a manner
annoying to persons passing by." The ordinance was nullified as it imposed no
standard at all "because one may never know in advance what 'annoys some people
but does not annoy others.' "
Similarly, the Ordinance does not specify the standards to ascertain which
establishments "tend to disturb the community," "annoy the inhabitants," and
"adversely affect the social and moral welfare of the community." The cited case
supports the nullification of the Ordinance for lack of comprehensible standards to
guide the law enforcers in carrying out its provisions.
Petitioners cannot therefore order the closure of the enumerated establishments
without infringing the due process clause. These lawful establishments may be
regulated, but not prevented from carrying on their business. This is a sweeping
exercise of police power that is a result of a lack of imagination on the part of the City
Council and which amounts to an interference into personal and private rights which
the Court will not countenance. In this regard, we take a resolute stand to uphold the
constitutional guarantee of the right to liberty and property.
Worthy of note is an example derived from the U.S. of a reasonable regulation which
is a far cry from the ill-considered Ordinance enacted by the City Council.
In FW/PBS, INC. v. Dallas,95 the city of Dallas adopted a comprehensive ordinance
regulating "sexually oriented businesses," which are defined to include adult arcades,
bookstores, video stores, cabarets, motels, and theaters as well as escort agencies,
nude model studio and sexual encounter centers. Among other things, the ordinance
required that such businesses be licensed. A group of motel owners were among the
three groups of businesses that filed separate suits challenging the ordinance. The
motel owners asserted that the city violated the due process clause by failing to
produce adequate support for its supposition that renting room for fewer than ten (10)
hours resulted in increased crime and other secondary effects. They likewise argued
than the ten (10)-hour limitation on the rental of motel rooms placed an
unconstitutional burden on the right to freedom of association. Anent the first
contention, the U.S. Supreme Court held that the reasonableness of the legislative
judgment combined with a study which the city considered, was adequate to support
the city's determination that motels permitting room rentals for fewer than ten (10 )
hours should be included within the licensing scheme. As regards the second point,
the Court held that limiting motel room rentals to ten (10) hours will have no
discernible effect on personal bonds as those bonds that are formed from the use of a
motel room for fewer than ten (10) hours are not those that have played a critical role
in the culture and traditions of the nation by cultivating and transmitting shared ideals
and beliefs.
The ordinance challenged in the above-cited case merely regulated the targeted
businesses. It imposed reasonable restrictions; hence, its validity was upheld.
The case of Ermita Malate Hotel and Motel Operators Association, Inc. v. City Mayor
of Manila,96 it needs pointing out, is also different from this case in that what was
involved therein was a measure which regulated the mode in which motels may
conduct business in order to put an end to practices which could encourage vice and
immorality. Necessarily, there was no valid objection on due process or equal
protection grounds as the ordinance did not prohibit motels. The Ordinance in this
case however is not a regulatory measure but is an exercise of an assumed power to
prohibit.97
The foregoing premises show that the Ordinance is an unwarranted and unlawful
curtailment of property and personal rights of citizens. For being unreasonable and an
undue restraint of trade, it cannot, even under the guise of exercising police power, be
upheld as valid.
B. The Ordinance violates Equal
Protection Clause
Equal protection requires that all persons or things similarly situated should be treated
alike, both as to rights conferred and responsibilities imposed. Similar subjects, in
other words, should not be treated differently, so as to give undue favor to some and
unjustly discriminate against others.98 The guarantee means that no person or class of
persons shall be denied the same protection of laws which is enjoyed by other
persons or other classes in like circumstances.99 The "equal protection of the laws is a
pledge of the protection of equal laws."100 It limits governmental discrimination. The
equal protection clause extends to artificial persons but only insofar as their property is
concerned.101
The Court has explained the scope of the equal protection clause in this wise:
What does it signify? To quote from J.M. Tuason & Co. v. Land Tenure
Administration: "The ideal situation is for the law's benefits to be available to
all, that none be placed outside the sphere of its coverage. Only thus could
chance and favor be excluded and the affairs of men governed by that
serene and impartial uniformity, which is of the very essence of the idea of
law." There is recognition, however, in the opinion that what in fact exists
"cannot approximate the ideal. Nor is the law susceptible to the reproach
that it does not take into account the realities of the situation. The
constitutional guarantee then is not to be given a meaning that disregards
what is, what does in fact exist. To assure that the general welfare be
promoted, which is the end of law, a regulatory measure may cut into the
rights to liberty and property. Those adversely affected may under such
circumstances invoke the equal protection clause only if they can show that
the governmental act assailed, far from being inspired by the attainment of
the common weal was prompted by the spirit of hostility, or at the very least,
discrimination that finds no support in reason." Classification is thus not
ruled out, it being sufficient to quote from the Tuason decision anew "that
 the laws operate equally and uniformly on all persons under similar
circumstances or that all persons must be treated in the same manner, the
conditions not being different, both in the privileges conferred and the
liabilities imposed. Favoritism and undue preference cannot be allowed. For
the principle is that equal protection and security shall be given to every
person under circumstances which, if not identical, are analogous. If law be
looked upon in terms of burden or charges, those that fall within a class
should be treated in the same fashion, whatever restrictions cast on some in
the group equally binding on the rest.102
Legislative bodies are allowed to classify the subjects of legislation. If the classification
is reasonable, the law may operate only on some and not all of the people without
violating the equal protection clause.103 The classification must, as an indispensable
requisite, not be arbitrary. To be valid, it must conform to the following requirements:
1) It must be based on substantial distinctions.
2) It must be germane to the purposes of the law.
3) It must not be limited to existing conditions only.
4) It must apply equally to all members of the class.104
In the Court's view, there are no substantial distinctions between motels, inns, pension
houses, hotels, lodging houses or other similar establishments. By definition, all are
commercial establishments providing lodging and usually meals and other services for
the public. No reason exists for prohibiting motels and inns but not pension houses,
hotels, lodging houses or other similar establishments. The classification in the instant
case is invalid as similar subjects are not similarly treated, both as to rights conferred
and obligations imposed. It is arbitrary as it does not rest on substantial distinctions
bearing a just and fair relation to the purpose of the Ordinance.
The Court likewise cannot see the logic for prohibiting the business and operation of
motels in the Ermita-Malate area but not outside of this area. A noxious establishment
does not become any less noxious if located outside the area.
The standard "where women are used as tools for entertainment" is also
discriminatory as prostitutionone of the hinted ills the Ordinance aims to banishis
not a profession exclusive to women. Both men and women have an equal propensity
to engage in prostitution. It is not any less grave a sin when men engage in it. And
why would the assumption that there is an ongoing immoral activity apply only when
women are employed and be inapposite when men are in harness? This
discrimination based on gender violates equal protection as it is not substantially
related to important government objectives.105 Thus, the discrimination is invalid.
Failing the test of constitutionality, the Ordinance likewise failed to pass the test of
consistency with prevailing laws.
C. The Ordinance is repugnant
to general laws; it is ultra vires
The Ordinance is in contravention of the Code as the latter merely empowers local
government units to regulate, and not prohibit, the establishments enumerated in
Section 1 thereof.
The power of the City Council to regulate by ordinances the establishment, operation,
and maintenance of motels, hotels and other similar establishments is found in
Section 458 (a) 4 (iv), which provides that:
Section 458. Powers, Duties, Functions and Compensation. (a) The
sangguniang panlungsod, as the legislative body of the city, shall enact
ordinances, approve resolutions and appropriate funds for the general
welfare of the city and its inhabitants pursuant to Section 16 of this Code
and in the proper exercise of the corporate powers of the city as provided
for under Section 22 of this Code, and shall:
. . .
(4) Regulate activities relative to the use of land, buildings and structures
within the city in order to promote the general welfare and for said purpose
shall:
. . .
(iv) Regulate the establishment, operation and maintenance of cafes,
restaurants, beerhouses, hotels, motels, inns, pension houses, lodging
houses, and other similar establishments, including tourist guides and
transports . . . .
While its power to regulate the establishment, operation and maintenance of any
entertainment or amusement facilities, and to prohibit certain forms of amusement or
entertainment is provided under Section 458 (a) 4 (vii) of the Code, which reads as
follows:
Section 458. Powers, Duties, Functions and Compensation. (a) The
sangguniang panlungsod, as the legislative body of the city, shall enact
ordinances, approve resolutions and appropriate funds for the general
welfare of the city and its inhabitants pursuant to Section 16 of this Code
and in the proper exercise of the corporate powers of the city as provided
for under Section 22 of this Code, and shall:
. . .
(4) Regulate activities relative to the use of land, buildings and structures
within the city in order to promote the general welfare and for said purpose
shall:
. . .
(vii) Regulate the establishment, operation, and maintenance of
any entertainment or amusement facilities, including theatrical
performances, circuses, billiard pools, public dancing schools,
public dance halls, sauna baths, massage parlors, and other
places for entertainment or amusement; regulate such other
events or activities for amusement or entertainment, particularly
those which tend to disturb the community or annoy the
inhabitants, or require the suspension or suppression of the
same; or, prohibit certain forms of amusement or entertainment in
order to protect the social and moral welfare of the community.
Clearly, with respect to cafes, restaurants, beerhouses, hotels, motels, inns, pension
houses, lodging houses, and other similar establishments, the only power of the City
Council to legislate relative thereto is to regulate them to promote the general welfare.
The Code still withholds from cities the power to suppress and prohibit altogether the
establishment, operation and maintenance of such establishments. It is well to recall
the rulings of the Court inKwong Sing v. City of Manila106 that:
The word "regulate," as used in subsection (l), section 2444 of the
Administrative Code, means and includes the power to control, to govern,
and to restrain; but "regulate" should not be construed as synonymous with
"suppress" or "prohibit." Consequently, under the power to regulate
laundries, the municipal authorities could make proper police regulations as
to the mode in which the employment or business shall be exercised.107
And in People v. Esguerra,108 wherein the Court nullified an ordinance of the
Municipality of Tacloban which prohibited the selling, giving and dispensing of liquor
ratiocinating that the municipality is empowered only to regulate the same and not
prohibit. The Court therein declared that:
(A)s a general rule when a municipal corporation is specifically given
authority or power to regulate or to license and regulate the liquor traffic,
power to prohibit is impliedly withheld.109
These doctrines still hold contrary to petitioners' assertion110 that they were modified
by the Code vesting upon City Councils prohibitory powers.
Similarly, the City Council exercises regulatory powers over public dancing schools,
public dance halls, sauna baths, massage parlors, and other places for entertainment
or amusement as found in the first clause of Section 458 (a) 4 (vii). Its powers to
regulate, suppress and suspend "such other events or activities for amusement or
entertainment, particularly those which tend to disturb the community or annoy the
inhabitants" and to "prohibit certain forms of amusement or entertainment in order to
protect the social and moral welfare of the community" are stated in the second and
third clauses, respectively of the same Section. The several powers of the City
Council as provided in Section 458 (a) 4 (vii) of the Code, it is pertinent to emphasize,
are separated by semi-colons (;), the use of which indicates that the clauses in which
these powers are set forth are independent of each other albeit closely related to
justify being put together in a single enumeration or paragraph. 111 These powers,
therefore, should not be confused, commingled or consolidated as to create a
conglomerated and unified power of regulation, suppression and prohibition. 112
The Congress unequivocably specified the establishments and forms of amusement
or entertainment subject to regulation among which are beerhouses, hotels, motels,
inns, pension houses, lodging houses, and other similar establishments (Section 458
(a) 4 (iv)), public dancing schools, public dance halls, sauna baths, massage parlors,
and other places for entertainment or amusement (Section 458 (a) 4 (vii)). This
enumeration therefore cannot be included as among "other events or activities for
amusement or entertainment, particularly those which tend to disturb the community
or annoy the inhabitants" or "certain forms of amusement or entertainment" which the
City Council may suspend, suppress or prohibit.
The rule is that the City Council has only such powers as are expressly granted to it
and those which are necessarily implied or incidental to the exercise thereof. By
reason of its limited powers and the nature thereof, said powers are to be
construed strictissimi juris and any doubt or ambiguity arising out of the terms used in
granting said powers must be construed against the City Council. 113 Moreover, it is a
general rule in statutory construction that the express mention of one person, thing, or
consequence is tantamount to an express exclusion of all others.Expressio unius est
exclusio alterium. This maxim is based upon the rules of logic and the natural
workings of human mind. It is particularly applicable in the construction of such
statutes as create new rights or remedies, impose penalties or punishments, or
otherwise come under the rule of strict construction.114
The argument that the City Council is empowered to enact the Ordinance by virtue of
the general welfare clause of the Code and of Art. 3, Sec. 18 (kk) of the Revised
Charter of Manila is likewise without merit. On the first point, the ruling of the Court
in People v. Esguerra,115 is instructive. It held that:
The powers conferred upon a municipal council in the general welfare
clause, or section 2238 of the Revised Administrative Code, refers to
matters not covered by the other provisions of the same Code, and
therefore it can not be applied to intoxicating liquors, for the power to
regulate the selling, giving away and dispensing thereof is granted
specifically by section 2242 (g) to municipal councils. To hold that, under the
general power granted by section 2238, a municipal council may enact the
ordinance in question, notwithstanding the provision of section 2242 (g),
would be to make the latter superfluous and nugatory, because the power to
prohibit, includes the power to regulate, the selling, giving away and
dispensing of intoxicating liquors.
On the second point, it suffices to say that the Code being a later expression of the
legislative will must necessarily prevail and override the earlier law, the Revised
Charter of Manila. Legis posteriores priores contrarias abrogant, or later statute
repeals prior ones which are repugnant thereto. As between two laws on the same
subject matter, which are irreconcilably inconsistent, that which is passed later
prevails, since it is the latest expression of legislative will. 116 If there is an
inconsistency or repugnance between two statutes, both relating to the same subject
matter, which cannot be removed by any fair and reasonable method of interpretation,
it is the latest expression of the legislative will which must prevail and override the
earlier.117
Implied repeals are those which take place when a subsequently enacted law contains
provisions contrary to those of an existing law but no provisions expressly repealing
them. Such repeals have been divided into two general classes: those which occur
where an act is so inconsistent or irreconcilable with an existing prior act that only one
of the two can remain in force and those which occur when an act covers the whole
subject of an earlier act and is intended to be a substitute therefor. The validity of such
a repeal is sustained on the ground that the latest expression of the legislative will
should prevail.118
In addition, Section 534(f) of the Code states that "All general and special laws, acts,
city charters, decrees, executive orders, proclamations and administrative regulations,
or part or parts thereof which are inconsistent with any of the provisions of this Code
are hereby repealed or modified accordingly." Thus, submitting to petitioners'
interpretation that the Revised Charter of Manila empowers the City Council to prohibit
motels, that portion of the Charter stating such must be considered repealed by the
Code as it is at variance with the latter's provisions granting the City Council mere
regulatory powers.
It is well to point out that petitioners also cannot seek cover under the general welfare
clause authorizing the abatement of nuisances without judicial proceedings. That tenet
applies to a nuisance per se, or one which affects the immediate safety of persons
and property and may be summarily abated under the undefined law of necessity. It
can not be said that motels are injurious to the rights of property, health or comfort of
the community. It is a legitimate business. If it be a nuisance per accidens it may be so
proven in a hearing conducted for that purpose. A motel is not per se a nuisance
warranting its summary abatement without judicial intervention.119
Notably, the City Council was conferred powers to prevent and prohibit certain
activities and establishments in another section of the Code which is reproduced as
follows:
Section 458. Powers, Duties, Functions and Compensation. (a) The
sangguniang panlungsod, as the legislative body of the city, shall enact
ordinances, approve resolutions and appropriate funds for the general
welfare of the city and its inhabitants pursuant to Section 16 of this Code
and in the proper exercise of the corporate powers of the city as provided
for under Section 22 of this Code, and shall:
(1) Approve ordinances and pass resolutions necessary for an efficient and
effective city government, and in this connection, shall:
. . .
(v) Enact ordinances intended to prevent, suppress and impose appropriate
penalties for habitual drunkenness in public places, vagrancy, mendicancy,
prostitution, establishment and maintenance of houses of ill repute,
gambling and other prohibited games of chance, fraudulent devices and
ways to obtain money or property, drug addiction, maintenance of drug
dens, drug pushing, juvenile delinquency, the printing, distribution or
exhibition of obscene or pornographic materials or publications, and such
other activities inimical to the welfare and morals of the inhabitants of the
city;
. . .
If it were the intention of Congress to confer upon the City Council the power to
prohibit the establishments enumerated in Section 1 of the Ordinance, it would have
so declared in uncertain terms by adding them to the list of the matters it may prohibit
under the above-quoted Section. The Ordinance now vainly attempts to lump these
establishments with houses of ill-repute and expand the City Council's powers in the
second and third clauses of Section 458 (a) 4 (vii) of the Code in an effort to overreach
its prohibitory powers. It is evident that these establishments may only be regulated in
their establishment, operation and maintenance.
It is important to distinguish the punishable activities from the establishments
themselves. That these establishments are recognized legitimate enterprises can be
gleaned from another Section of the Code. Section 131 under the Title on Local
Government Taxation expressly mentioned proprietors or operators of massage
clinics, sauna, Turkish and Swedish baths, hotels, motels and lodging houses as
among the "contractors" defined in paragraph (h) thereof. The same Section also
defined "amusement" as a "pleasurable diversion and entertainment," "synonymous to
relaxation, avocation, pastime or fun;" and "amusement places" to include "theaters,
cinemas, concert halls, circuses and other places of amusement where one seeks
admission to entertain oneself by seeing or viewing the show or performances." Thus,
it can be inferred that the Code considers these establishments as legitimate
enterprises and activities. It is well to recall the maxim reddendo singula singulis which
means that words in different parts of a statute must be referred to their appropriate
connection, giving to each in its place, its proper force and effect, and, if possible,
rendering none of them useless or superfluous, even if strict grammatical construction
demands otherwise. Likewise, where words under consideration appear in different
sections or are widely dispersed throughout an act the same principle applies. 120
Not only does the Ordinance contravene the Code, it likewise runs counter to the
provisions of P.D. 499. As correctly argued by MTDC, the statute had already
converted the residential Ermita-Malate area into a commercial area. The decree
allowed the establishment and operation of all kinds of commercial establishments
except warehouse or open storage depot, dump or yard, motor repair shop, gasoline
service station, light industry with any machinery or funeral establishment. The rule is
that for an ordinance to be valid and to have force and effect, it must not only be within
the powers of the council to enact but the same must not be in conflict with or
repugnant to the general law.121 As succinctly illustrated in Solicitor General v.
Metropolitan Manila Authority:122
The requirement that the enactment must not violate existing law explains
itself. Local political subdivisions are able to legislate only by virtue of a valid
delegation of legislative power from the national legislature (except only that
the power to create their own sources of revenue and to levy taxes is
conferred by the Constitution itself). They are mere agents vested with what
is called the power of subordinate legislation. As delegates of the Congress,
the local government units cannot contravene but must obey at all times the
will of their principal. In the case before us, the enactment in question, which
are merely local in origin cannot prevail against the decree, which has the
force and effect of a statute.123
Petitioners contend that the Ordinance enjoys the presumption of validity. While this
may be the rule, it has already been held that although the presumption is always in
favor of the validity or reasonableness of the ordinance, such presumption must
nevertheless be set aside when the invalidity or unreasonableness appears on the
face of the ordinance itself or is established by proper evidence. The exercise of police
power by the local government is valid unless it contravenes the fundamental law of
the land, or an act of the legislature, or unless it is against public policy or is
unreasonable, oppressive, partial, discriminating or in derogation of a common right. 124
Conclusion
All considered, the Ordinance invades fundamental personal and property rights and
impairs personal privileges. It is constitutionally infirm. The Ordinance contravenes
statutes; it is discriminatory and unreasonable in its operation; it is not sufficiently
detailed and explicit that abuses may attend the enforcement of its sanctions. And not
to be forgotten, the City Council under the Code had no power to enact Respondent. PERALTA, JJ.
the Ordinance and is therefore ultra vires, null and void.
Promulgated:
Concededly, the challenged Ordinance was enacted with the best of motives and
shares the concern of the public for the cleansing of the Ermita-Malate area of its January 20, 2009
social sins. Police power legislation of such character deserves the full endorsement
of the judiciary we reiterate our support for it. But inspite of its virtuous aims, the
enactment of the Ordinance has no statutory or constitutional authority to stand on. x---------------------------------------------------------------------------x
Local legislative bodies, in this case, the City Council, cannot prohibit the operation of
the enumerated establishments under Section 1 thereof or order their transfer or
conversion without infringing the constitutional guarantees of due process and equal DECISION
protection of laws not even under the guise of police power.
WHEREFORE, the Petition is hereby DENIED and the decision of the Regional Trial
Court declaring the Ordinance void is AFFIRMED. Costs against petitioners. TINGA, J.:

SO ORDERED.

EN BANC
With another city ordinance of Manila also principally involving the tourist district as
WHITE LIGHT CORPORATION, G.R. No. 122846
subject, the Court is confronted anew with the incessant clash between government
TITANIUM CORPORATION and
STA. MESA TOURIST & DEVE- Present: power and individual liberty in tandem with the archetypal tension between law and

LOPMENT CORPORATION, morality.

Petitioners, PUNO, C.J.
QUISUMBING,
YNARES SANTIAGO, In City of Manila v. Laguio, Jr.,[1] the Court affirmed the nullification of a city ordinance
CARPIO,
barring the operation of motels and inns, among other establishments, within the
AUSTRIA-MARTINEZ,
Ermita-Malate area. The petition at bar assails a similarly-motivated city ordinance that
- versus - CORONA,
prohibits those same establishments from offering short-time admission, as well as
CARPIO MORALES,
AZCUNA, pro-rated or wash up rates for such abbreviated stays. Our earlier decision tested the

TINGA, city ordinance against our sacred constitutional rights to liberty, due process and equal
CHICO-NAZARIO, protection of law. The same parameters apply to the present petition.
VELASCO, JR.,
NACHURA, This Petition[2] under Rule 45 of the Revised Rules on Civil Procedure, which seeks

CITY OF MANILA, represented by DE CASTRO, the reversal of the Decision[3] in C.A.-G.R. S.P. No. 33316 of the Court of Appeals,
MAYOR ALFREDO S. LIM, BRION, and challenges the validity of Manila City Ordinance No. 7774 entitled, An Ordinance

Prohibiting Short-Time Admission, Short-Time Admission Rates, and Wash-Up Rate
Schemes in Hotels, Motels, Inns, Lodging Houses, Pension Houses, and Similar
Establishments in the City of Manila (the Ordinance).
I.
The facts are as follows:
On December 3, 1992, City Mayor Alfredo S. Lim (Mayor Lim) signed into law the
Ordinance.[4] The Ordinance is reproduced in full, hereunder:
SECTION 1. Declaration of Policy. It is hereby the
declared policy of the City Government to protect the best
interest, health and welfare, and the morality of its
constituents in general and the youth in particular.
SEC. 2. Title. This ordinance shall be known as An
Ordinance prohibiting short time admission in hotels, motels,
lodging houses, pension houses and similar establishments
in the City of Manila.
SEC. 3. Pursuant to the above policy, short-time admission
and rate [sic], wash-up rate or other similarly concocted
terms, are hereby prohibited in hotels, motels, inns, lodging
houses, pension houses and similar establishments in the
City of Manila.
SEC. 4. Definition of Term[s]. Short-time admission shall
mean admittance and charging of room rate for less than
twelve (12) hours at any given time or the renting out of
rooms more than twice a day or any other term that may be
concocted by owners or managers of said establishments
but would mean the same or would bear the same meaning.
SEC. 5. Penalty Clause. Any person or corporation who shall
violate any provision of this ordinance shall upon conviction
thereof be punished by a fine of Five Thousand (P5,000.00)
Pesos or imprisonment for a period of not exceeding one (1)
year or both such fine and imprisonment at the discretion of
the court; Provided, That in case of [a] juridical person, the
president, the manager, or the persons in charge of the
operation thereof shall be liable: Provided, further, That in
case of subsequent conviction for the same offense, the
business license of the guilty party shall automatically be
cancelled.
SEC. 6. Repealing Clause. Any or all provisions of City
ordinances not consistent with or contrary to this measure or
any portion hereof are hereby deemed repealed.
SEC. 7. Effectivity. This ordinance shall take effect
immediately upon approval.
Enacted by the city Council of Manila at its regular session
today, November 10, 1992.
Approved by His Honor, the Mayor on December 3, 1992.
On December 15, 1992, the Malate Tourist and Development Corporation
(MTDC) filed a complaint for declaratory relief with prayer for a writ of preliminary
injunction and/or temporary restraining order ( TRO)[5] with the Regional Trial Court
(RTC) of Manila, Branch 9 impleading as defendant, herein respondent City of Manila
(the City) represented by Mayor Lim.[6] MTDC prayed that the Ordinance, insofar as it
includes motels and inns as among its prohibited establishments, be declared invalid
and unconstitutional. MTDC claimed that as owner and operator of the Victoria Court
in Malate, Manila it was authorized by Presidential Decree (P.D.) No. 259 to admit
customers on a short time basis as well as to charge customers wash up rates for

stays of only three hours. On February 8, 1993, the RTC issued a writ of preliminary injunction ordering the city

to desist from the enforcement of the Ordinance. [15] A month later, on March 8, 1993,

the Solicitor General filed his Comment arguing that the Ordinance is constitutional.

During the pre-trial conference, the WLC, TC and STDC agreed to submit the case for

decision without trial as the case involved a purely legal question.[16] On October 20,

On December 21, 1992, petitioners White Light Corporation (WLC), 1993, the RTC rendered a decision declaring the Ordinance null and void. The

Titanium Corporation (TC) and Sta. Mesa Tourist and Development Corporation dispositive portion of the decision reads:

(STDC) filed a motion to intervene and to admit attached complaint-in-

WHEREFORE, in view of all the foregoing, [O]rdinance No.
intervention[7] on the ground that the Ordinance directly affects their business interests 7774 of the City of Manila is hereby declared null and void.
as operators of drive-in-hotels and motels in Manila.[8] The three companies are

components of the Anito Group of Companies which owns and operates several Accordingly, the preliminary injunction heretofor issued is
hereby made permanent.
hotels and motels in Metro Manila.[9]

SO ORDERED.[17]

On December 23, 1992, the RTC granted the motion to intervene.[10] The

RTC also notified the Solicitor General of the proceedings pursuant to then Rule 64,

Section 4 of the Rules of Court. On the same date, MTDC moved to withdraw as
The RTC noted that the ordinance strikes at the personal liberty of the
plaintiff.[11]
individual guaranteed and jealously guarded by the Constitution.[18] Reference was

made to the provisions of the Constitution encouraging private enterprises and the

incentive to needed investment, as well as the right to operate economic enterprises.

On December 28, 1992, the RTC granted MTDC's motion to withdraw. [12] The RTC
Finally, from the observation that the illicit relationships the Ordinance sought to
issued a TRO on January 14, 1993, directing the City to cease and desist from
dissuade could nonetheless be consummated by simply paying for a 12-hour stay, the
enforcing the Ordinance.[13] The City filed an Answer dated January 22, 1993 alleging
RTC likened the law to the ordinance annulled in Ynot v. Intermediate Appellate
that the Ordinance is a legitimate exercise of police power. [14]

Court,[19] where the legitimate purpose of preventing indiscriminate slaughter of
carabaos was sought to be effected through an inter-province ban on the transport of
carabaos and carabeef.
The City later filed a petition for review on certiorari with the Supreme
[20]
Court. The petition was docketed as G.R. No. 112471. However in a resolution
dated January 26, 1994, the Court treated the petition as a petition for certiorari and
referred the petition to the Court of Appeals.[21]
Before the Court of Appeals, the City asserted that the Ordinance is a valid
exercise of police power pursuant to Section 458 (4)(iv) of the Local Government
Code which confers on cities, among other local government units, the power:
[To] regulate the establishment, operation and
maintenance of cafes, restaurants, beerhouses, hotels,
motels, inns, pension houses, lodging houses and other
similar establishments, including tourist guides and
transports.[22]
The Ordinance, it is argued, is also a valid exercise of the power of the City
under Article III, Section 18(kk) of the Revised Manila Charter, thus:
to enact all ordinances it may deem necessary and
proper for the sanitation and safety, the furtherance of the
prosperity and the promotion of the morality, peace, good
order, comfort, convenience and general welfare of the city
and its inhabitants, and such others as be necessary to carry
into effect and discharge the powers and duties conferred by
this Chapter; and to fix penalties for the violation of
ordinances which shall not exceed two hundred pesos fine or
six months imprisonment, or both such fine and
imprisonment for a single offense.[23]
Petitioners argued that the Ordinance is unconstitutional and void since it
violates the right to privacy and the freedom of movement; it is an invalid exercise of
police power; and it is an unreasonable and oppressive interference in their business.
The Court of Appeals reversed the decision of the RTC and affirmed the
constitutionality of the Ordinance.[24] First, it held that the Ordinance did not violate the
right to privacy or the freedom of movement, as it only penalizes the owners or
operators of establishments that admit individuals for short time stays. Second, the
virtually limitless reach of police power is only constrained by having a lawful object
obtained through a lawful method. The lawful objective of the Ordinance is satisfied
since it aims to curb immoral activities. There is a lawful method since the
establishments are still allowed to operate. Third, the adverse effect on the
establishments is justified by the well-being of its constituents in general. Finally, as
held in Ermita-Malate Motel Operators Association v. City Mayor of Manila, liberty is
regulated by law.
TC, WLC and STDC come to this Court via petition for review on certiorari.[25] In their
petition and Memorandum, petitioners in essence repeat the assertions they made
before the Court of Appeals. They contend that the assailed Ordinance is an invalid
exercise of police power.
 Nonetheless, the general rules on standing admit of several exceptions such as the

overbreadth doctrine, taxpayer suits, third party standing and, especially in

II.
the Philippines, the doctrine of transcendental importance.[31]

We must address the threshold issue of petitioners standing. Petitioners allege that as

owners of establishments offering wash-up rates, their business is being unlawfully

interfered with by the Ordinance. However, petitioners also allege that the equal

protection rights of their clients are also being interfered with. Thus, the crux of the

matter is whether or not these establishments have the requisite standing to plead for

protection of their patrons' equal protection rights.

For this particular set of facts, the concept of third party standing as an exception and
Standing or locus standi is the ability of a party to demonstrate to the court
the overbreadth doctrine are appropriate. In Powers v. Ohio,[32] the United States
sufficient connection to and harm from the law or action challenged to support that
Supreme Court wrote that: We have recognized the right of litigants to bring actions on
party's participation in the case. More importantly, the doctrine of standing is built on
behalf of third parties, provided three important criteria are satisfied: the litigant must
the principle of separation of powers,[26] sparing as it does unnecessary interference
have suffered an injury-in-fact, thus giving him or her a "sufficiently concrete interest"
or invalidation by the judicial branch of the actions rendered by its co-equal branches
in the outcome of the issue in dispute; the litigant must have a close relation to the
of government.
third party; and there must exist some hindrance to the third party's ability to protect

his or her own interests."[33] Herein, it is clear that the business interests of the

The requirement of standing is a core component of the judicial system petitioners are likewise injured by the Ordinance. They rely on the patronage of their
[27]
derived directly from the Constitution. The constitutional component of standing customers for their continued viability which appears to be threatened by the

doctrine incorporates concepts which concededly are not susceptible of precise enforcement of the Ordinance. The relative silence in constitutional litigation of such
[28]
definition. In this jurisdiction, the extancy of a direct and personal interest presents special interest groups in our nation such as the American Civil Liberties Union in

the most obvious cause, as well as the standard test for a petitioner's standing.[29] In a the United States may also be construed as a hindrance for customers to bring suit. [34]

similar vein, the United States Supreme Court reviewed and elaborated on the

meaning of the three constitutional standing requirements of injury, causation, and

redressability in Allen v. Wright.[30]

American jurisprudence is replete with examples where parties-in-interest were see that based on the allegations in the petition, the Ordinance suffers from

allowed standing to advocate or invoke the fundamental due process or equal overbreadth.

protection claims of other persons or classes of persons injured by state action.

We thus recognize that the petitioners have a right to assert the constitutional rights of
In Griswold v. Connecticut,[35] the United States Supreme Court held that physicians
their clients to patronize their establishments for a wash-rate time frame.
had standing to challenge a reproductive health statute that would penalize them as
III.
accessories as well as to plead the constitutional protections available to their

patients. The Court held that:

To students of jurisprudence, the facts of this case will recall to mind not only the
The rights of husband and wife, pressed here, are likely to
be diluted or adversely affected unless those rights are recent City of Manila ruling, but our 1967 decision in Ermita-Malate Hotel and Motel
considered in a suit involving those who have this kind of
confidential relation to them."[36] Operations Association, Inc., v. Hon. City Mayor of Manila.[40] Ermita-

Malate concerned the City ordinance requiring patrons to fill up a prescribed form

An even more analogous example may be found in Craig v. Boren,[37] wherein the stating personal information such as name, gender, nationality, age, address and

United States Supreme Court held that a licensed beverage vendor has standing to occupation before they could be admitted to a motel, hotel or lodging house. This

raise the equal protection claim of a male customer challenging a statutory scheme earlier ordinance was precisely enacted to minimize certain practices deemed harmful

prohibiting the sale of beer to males under the age of 21 and to females under the age to public morals. A purpose similar to the annulled ordinance in City of Manila which

of 18. The United States High Court explained that the vendors had standing "by sought a blanket ban on motels, inns and similar establishments in the Ermita-Malate

acting as advocates of the rights of third parties who seek access to their market or area. However, the constitutionality of the ordinance in Ermita-Malate was sustained

function."[38] by the Court.

Assuming arguendo that petitioners do not have a relationship with their patrons for

the former to assert the rights of the latter, the overbreadth doctrine comes into play.
The common thread that runs through those decisions and the case at bar goes
In overbreadth analysis, challengers to government action are in effect permitted to
beyond the singularity of the localities covered under the respective ordinances. All
raise the rights of third parties. Generally applied to statutes infringing on the freedom
three ordinances were enacted with a view of regulating public morals including
of speech, the overbreadth doctrine applies when a statute needlessly restrains even
particular illicit activity in transient lodging establishments. This could be described as
constitutionally guaranteed rights.[39] In this case, the petitioners claim that the
the middle case, wherein there is no wholesale ban on motels and hotels but the
Ordinance makes a sweeping intrusion into the right to liberty of their clients. We can
services offered by these establishments have been severely restricted. At its core,
this is another case about the extent to which the State can intrude into and regulate corresponding right to protect itself and its people.[43] Police power has been used as

the lives of its citizens. justification for numerous and varied actions by the State. These range from the

regulation of dance halls,[44]movie theaters,[45] gas stations[46] and cockpits.[47] The

awesome scope of police power is best demonstrated by the fact that in its hundred or
The test of a valid ordinance is well established. A long line of decisions including City
so years of presence in our nations legal system, its use has rarely been denied.
of Manila has held that for an ordinance to be valid, it must not only be within the
The apparent goal of the Ordinance is to minimize if not eliminate the use of
corporate powers of the local government unit to enact and pass according to the
the covered establishments for illicit sex, prostitution, drug use and alike. These goals,
procedure prescribed by law, it must also conform to the following substantive
by themselves, are unimpeachable and certainly fall within the ambit of the police
requirements: (1) must not contravene the Constitution or any statute; (2) must not be
power of the State. Yet the desirability of these ends do not sanctify any and all means
unfair or oppressive; (3) must not be partial or discriminatory; (4) must not prohibit but
for their achievement. Those means must align with the Constitution, and our
may regulate trade; (5) must be general and consistent with public policy; and (6) must
emerging sophisticated analysis of its guarantees to the people. The Bill of Rights
not be unreasonable.
stands as a rebuke to the seductive theory of Macchiavelli, and, sometimes even, the

political majorities animated by his cynicism.

The Ordinance prohibits two specific and distinct business practices, namely

wash rate admissions and renting out a room more than twice a day. The ban is
Even as we design the precedents that establish the framework for analysis of due
evidently sought to be rooted in the police power as conferred on local government
process or equal protection questions, the courts are naturally inhibited by a due
units by the Local Government Code through such implements as the general welfare
deference to the co-equal branches of government as they exercise their political
clause.
functions. But when we are compelled to nullify executive or legislative actions, yet
A.
another form of caution emerges. If the Court were animated by the same passing

fancies or turbulent emotions that motivate many political decisions, judicial integrity is

compromised by any perception that the judiciary is merely the third political branch of
Police power, while incapable of an exact definition, has been purposely
government. We derive our respect and good standing in the annals of history by
veiled in general terms to underscore its comprehensiveness to meet all exigencies
acting as judicious and neutral arbiters of the rule of law, and there is no surer way to
and provide enough room for an efficient and flexible response as the conditions
that end than through the development of rigorous and sophisticated legal standards
warrant.[42] Police power is based upon the concept of necessity of the State and its
through which the courts analyze the most fundamental and far-reaching constitutional Substantive due process completes the protection envisioned by the due process

questions of the day. clause. It inquires whether the government has sufficient justification for depriving a

person of life, liberty, or property.[50]

B.

The primary constitutional question that confronts us is one of due process,

as guaranteed under Section 1, Article III of the Constitution. Due process evades a

precise definition.[48] The purpose of the guaranty is to prevent arbitrary governmental

encroachment against the life, liberty and property of individuals. The due process

guaranty serves as a protection against arbitrary regulation or seizure. Even

corporations and partnerships are protected by the guaranty insofar as their property

is concerned.

The due process guaranty has traditionally been interpreted as imposing two related

but distinct restrictions on government, "procedural due process" and "substantive due

process." Procedural due process refers to the procedures that the government must

follow before it deprives a person of life, liberty, or property. [49] Procedural due process

concerns itself with government action adhering to the established process when it

makes an intrusion into the private sphere. Examples range from the form of notice

given to the level of formality of a hearing.

If due process were confined solely to its procedural aspects, there would arise absurd

situation of arbitrary government action, provided the proper formalities are followed.
 A third standard, denominated as heightened or immediate scrutiny, was

later adopted by the U.S. Supreme Court for evaluating classifications based on

gender[53] and legitimacy.[54] Immediate scrutiny was adopted by the U.S. Supreme
The question of substantive due process, moreso than most other fields of
Court in Craig,[55] after the Court declined to do so in Reed v. Reed.[56] While the test
law, has reflected dynamism in progressive legal thought tied with the expanded
may have first been articulated in equal protection analysis, it has in the United
acceptance of fundamental freedoms. Police power, traditionally awesome as it may
States since been applied in all substantive due process cases as well.
be, is now confronted with a more rigorous level of analysis before it can be upheld.

The vitality though of constitutional due process has not been predicated on the

frequency with which it has been utilized to achieve a liberal result for, after all, the We ourselves have often applied the rational basis test mainly in analysis of

libertarian ends should sometimes yield to the prerogatives of the State. Instead, the equal protection challenges.[57] Using the rational basis examination, laws or

due process clause has acquired potency because of the sophisticated methodology ordinances are upheld if they rationally further a legitimate governmental

that has emerged to determine the proper metes and bounds for its application. interest.[58] Under intermediate review, governmental interest is extensively examined

and the availability of less restrictive measures is considered.[59] Applying strict

scrutiny, the focus is on the presence of compelling, rather than substantial,

C.
governmental interest and on the absence of less restrictive means for achieving that

interest.

The general test of the validity of an ordinance on substantive due process

grounds is best tested when assessed with the evolved footnote 4 test laid down by
In terms of judicial review of statutes or ordinances, strict scrutiny refers to
the U.S. Supreme Court in U.S. v. Carolene Products.[51] Footnote 4 of the Carolene
the standard for determining the quality and the amount of governmental interest
Products case acknowledged that the judiciary would defer to the legislature unless
brought to justify the regulation of fundamental freedoms. [60] Strict scrutiny is used
there is a discrimination against a discrete and insular minority or infringement of a
today to test the validity of laws dealing with the regulation of speech, gender, or race
fundamental right.[52] Consequently, two standards of judicial review were established:
as well as other fundamental rights as expansion from its earlier applications to equal
strict scrutiny for laws dealing with freedom of the mind or restricting the political
protection.[61] The United States Supreme Court has expanded the scope of strict
process, and the rational basis standard of review for economic legislation.
scrutiny to protect fundamental rights such as suffrage,[62] judicial access[63] and

interstate travel.[64]
 D.

If we were to take the myopic view that an Ordinance should be analyzed

strictly as to its effect only on the petitioners at bar, then it would seem that the only
The rights at stake herein fall within the same fundamental rights to liberty
restraint imposed by the law which we are capacitated to act upon is the injury to
which we upheld in City of Manila v. Hon. Laguio, Jr. We expounded on that most
property sustained by the petitioners, an injury that would warrant the application of
primordial of rights, thus:
the most deferential standard the rational basis test. Yet as earlier stated, we

recognize the capacity of the petitioners to invoke as well the constitutional rights of
their patrons those persons who would be deprived of availing short time access or
wash-up rates to the lodging establishments in question.
Viewed cynically, one might say that the infringed rights of these customers
were are trivial since they seem shorn of political consequence. Concededly, these
Liberty as guaranteed by the Constitution was defined
by Justice Malcolm to include "the right to exist and the right to be
free from arbitrary restraint or servitude. The term cannot be
dwarfed into mere freedom from physical restraint of the person of
the citizen, but is deemed to embrace the right of man to enjoy
the facilities with which he has been endowed by his Creator,
subject only to such restraint as are necessary for the common
welfare."[[65]] In accordance with this case, the rights of the citizen
to be free to use his faculties in all lawful ways; to live and work
where he will; to earn his livelihood by any lawful calling; and to
pursue any avocation are all deemed embraced in the concept of
liberty.[[66]]

are not the sort of cherished rights that, when proscribed, would impel the people to The U.S. Supreme Court in the case of Roth v. Board of
Regents, sought to clarify the meaning of "liberty." It said:
tear up their cedulas. Still, the Bill of Rights does not shelter gravitas alone. Indeed, it

is those trivial yet fundamental freedoms which the people reflexively exercise any day
While the Court has not attempted
without the impairing awareness of their constitutional consequence that accurately to define with exactness the liberty . . .
guaranteed [by the Fifth and Fourteenth
reflect the degree of liberty enjoyed by the people. Liberty, as integrally incorporated Amendments], the term denotes not merely
freedom from bodily restraint but also the
as a fundamental right in the Constitution, is not a Ten Commandments-style right of the individual to contract, to engage in
any of the common occupations of life, to
enumeration of what may or what may not be done; but rather an atmosphere of acquire useful knowledge, to marry, establish
a home and bring up children, to worship God
freedom where the people do not feel labored under a Big Brother presence as they according to the dictates of his own
conscience, and generally to enjoy those
interact with each other, their society and nature, in a manner innately understood by privileges long recognized . . . as essential to
the orderly pursuit of happiness by free men.
them as inherent, without doing harm or injury to others. In a Constitution for a free people, there can
be no doubt that the meaning of "liberty" must
be broad indeed.[67] [Citations omitted]

It cannot be denied that the primary animus behind the ordinance is the
Indeed, the right to privacy as a constitutional right was
recognized in Morfe, the invasion of which should be justified by a
compelling state interest. Morfe accorded recognition to the right to
privacy independently of its identification with liberty; in itself it is
fully deserving of constitutional protection. Governmental powers
should stop short of certain intrusions into the personal life of the
citizen.[70]

curtailment of sexual behavior. The City asserts before this Court that the subject

establishments have gained notoriety as venue of prostitution, adultery and

fornications in Manila since they provide the necessary atmosphere for clandestine

entry, presence and exit and thus became the ideal haven for prostitutes and thrill- We cannot discount other legitimate activities which the Ordinance would

seekers.[68] Whether or not this depiction of a mise-en-scene of vice is accurate, it proscribe or impair. There are very legitimate uses for a wash rate or renting the room

cannot be denied that legitimate sexual behavior among willing married or consenting out for more than twice a day. Entire families are known to choose pass the time in a

single adults which is constitutionally protected[69] will be curtailed as well, as it was in motel or hotel whilst the power is momentarily out in their homes. In transit

the City of Manila case. Our holding therein retains significance for our purposes: passengers who wish to wash up and rest between trips have a legitimate purpose for

abbreviated stays in motels or hotels. Indeed any person or groups of persons in need

of comfortable private spaces for a span of a few hours with purposes other than
The concept of liberty compels respect for the individual
whose claim to privacy and interference demands respect. As the
having sex or using illegal drugs can legitimately look to staying in a motel or hotel as
case of Morfe v. Mutuc, borrowing the words of Laski, so very
aptly stated: a convenient alternative.

Man is one among many, obstinately

refusing reduction to unity. His separateness,
his isolation, are indefeasible; indeed, they are E.
so fundamental that they are the basis on
which his civic obligations are built. He cannot
abandon the consequences of his isolation,
which are, broadly speaking, that his
experience is private, and the will built out of
That the Ordinance prevents the lawful uses of a wash rate depriving
that experience personal to himself. If he
surrenders his will to others, he surrenders
patrons of a product and the petitioners of lucrative business ties in with another
himself. If his will is set by the will of others, he
ceases to be a master of himself. I cannot
constitutional requisite for the legitimacy of the Ordinance as a police power measure.
believe that a man no longer a master of
himself is in any real sense free. It must appear that the interests of the public generally, as distinguished from those of

a particular class, require an interference with private rights and the means must

be reasonably necessary for the accomplishment of the purpose and not unduly
oppressive of private rights.[71] It must also be evident that no other alternative for the

accomplishment of the purpose less intrusive of private rights can work. More
The Court has professed its deep sentiment and tenderness of the Ermita-
importantly, a reasonable relation must exist between the purposes of the measure
Malate area, its longtime home,[76] and it is skeptical of those who wish to depict our
and the means employed for its accomplishment, for even under the guise of
capital city the Pearl of the Orient as a modern-day Sodom or Gomorrah for the Third
protecting the public interest, personal rights and those pertaining to private property
World set. Those still steeped in Nick Joaquin-dreams of the grandeur of
will not be permitted to be arbitrarily invaded.[72]
Old Manila will have to accept that Manila like all evolving big cities, will have its

problems. Urban decay is a fact of mega cities such as Manila, and vice is a common

problem confronted by the modern metropolis wherever in the world. The solution to
Lacking a concurrence of these requisites, the police measure shall be
such perceived decay is not to prevent legitimate businesses from offering a legitimate
struck down as an arbitrary intrusion into private rights. As held in Morfe v. Mutuc, the
product. Rather, cities revive themselves by offering incentives for new businesses to
exercise of police power is subject to judicial review when life, liberty or property is
sprout up thus attracting the dynamism of individuals that would bring a new grandeur
affected.[73] However, this is not in any way meant to take it away from the vastness of
to Manila.
State police power whose exercise enjoys the presumption of validity. [74]

The behavior which the Ordinance seeks to curtail is in fact already

Similar to the Comelec resolution requiring newspapers to donate
prohibited and could in fact be diminished simply by applying existing laws. Less
advertising space to candidates, this Ordinance is a blunt and heavy
intrusive measures such as curbing the proliferation of prostitutes and drug dealers
instrument.[75] The Ordinance makes no distinction between places frequented by
through active police work would be more effective in easing the situation. So would
patrons engaged in illicit activities and patrons engaged in legitimate actions. Thus it
the strict enforcement of existing laws and regulations penalizing prostitution and drug
prevents legitimate use of places where illicit activities are rare or even unheard of. A
use. These measures would have minimal intrusion on the businesses of the
plain reading of section 3 of the Ordinance shows it makes no classification of places
petitioners and other legitimate merchants. Further, it is apparent that the Ordinance
of lodging, thus deems them all susceptible to illicit patronage and subject them
can easily be circumvented by merely paying the whole day rate without any
without exception to the unjustified prohibition.
hindrance to those engaged in illicit activities. Moreover, drug dealers and prostitutes

can in fact collect wash rates from their clientele by charging their customers a portion

of the rent for motel rooms and even apartments.

 by Calabresi, that phrase is more accurately interpreted as meaning that efforts to

legislate morality will fail if they are widely at variance with public attitudes about right
IV.
and wrong.[80] Our penal laws, for one, are founded on age-old moral traditions, and as
We reiterate that individual rights may be adversely affected only to the
long as there are widely accepted distinctions between right and wrong, they will
extent that may fairly be required by the legitimate demands of public interest or public
remain so oriented.
welfare.The State is a leviathan that must be restrained from needlessly intruding into

the lives of its citizens. However well-intentioned the Ordinance may be, it is in effect

an arbitrary and whimsical intrusion into the rights of the establishments as well as Yet the continuing progression of the human story has seen not only the

their patrons. The Ordinance needlessly restrains the operation of the businesses of acceptance of the right-wrong distinction, but also the advent of fundamental liberties

the petitioners as well as restricting the rights of their patrons without sufficient as the key to the enjoyment of life to the fullest. Our democracy is distinguished from

justification. The Ordinance rashly equates wash rates and renting out a room more non-free societies not with any more extensive elaboration on our part of what is moral

than twice a day with immorality without accommodating innocuous intentions. and immoral, but from our recognition that the individual liberty to make the choices in

our lives is innate, and protected by the State. Independent and fair-minded judges

themselves are under a moral duty to uphold the Constitution as the embodiment of
The promotion of public welfare and a sense of morality among citizens deserves the
the rule of law, by reason of their expression of consent to do so when they take the
full endorsement of the judiciary provided that such measures do not trample rights
oath of office, and because they are entrusted by the people to uphold the law. [81]
[77]
this Court is sworn to protect. The notion that the promotion of public morality is a

function of the State is as old as Aristotle.[78] The advancement of moral relativism as a

school of philosophy does not de-legitimize the role of morality in law, even if it may Even as the implementation of moral norms remains an indispensable

foster wider debate on which particular behavior to penalize. It is conceivable that a complement to governance, that prerogative is hardly absolute, especially in the face

society with relatively little shared morality among its citizens could be functional so of the norms of due process of liberty. And while the tension may often be left to the

long as the pursuit of sharply variant moral perspectives yields an adequate courts to relieve, it is possible for the government to avoid the constitutional conflict by

accommodation of different interests.[79] employing more judicious, less drastic means to promote morality.

To be candid about it, the oft-quoted American maxim that you WHEREFORE, the Petition is GRANTED. The Decision of the Court of

cannot legislate morality is ultimately illegitimate as a matter of law, since as explained Appeals is REVERSED, and the Decision of the Regional Trial Court of Manila,

Branch 9, isREINSTATED. Ordinance No. 7774 is hereby declared
UNCONSTITUTIONAL. No pronouncement as to costs.
SO ORDERED.
SECOND DIVISION
G.R. No. 198860 July 23, 2012
ABRAHAM RIMANDO, Petitioner,
vs.
NAGUILIAN EMISSION TESTING CENTER, INC., represented by its President,
ROSEMARIE LLARENAS and HON. COURT OF APPEALS, Respondents.
RESOLUTION
REYES, J.:
Before us is a petition for review on certiorari1 under Rule 45 of the Rules of Court
seeking to annul and set aside Decision2 dated March 30, 2011 of the Court of
Appeals (CA) in CA-G.R. SP NO. 112152.
The Facts
The present controversy stemmed from a petition for mandamus and damages filed
before Branch 67 of the Regional Trial Court (RTC) of Bauang, La Union, by Naguilian
Emission Testing Center, Inc., represented by its President, Rosemarie Llarenas
(respondent) against Abraham P. Rimando (petitioner), who, at the time material to
the case, was the sitting mayor of the Municipality of Naguilian, La Union.
The petition prayed for the issuance of a writ of mandamus to compel the petitioner to
issue a business permit in favor of the respondent.
In support of its plea, the respondent claimed that its business is being conducted on a
parcel of land which formerly belonged to the national government but later on
certified by the Department of Environment and Natural Resources (DENR) as an
alienable and disposable land of the public domain. The respondent had operated its
business of emission testing on the land from 2005 to 2007. On January 18, 2008, the
respondent filed an application for the renewal of its business permit and paid the
corresponding fees therefor.
The petitioner, however, refused to issue a business permit unless and until the
respondent executes a contract of lease with the Municipality of Naguilian. The
respondent was amenable to signing such contract subject to some proposed
revisions, which, however, were not acceptable to the petitioner. The parties did not
reach a common ground hence, the petition for mandamus.
The Ruling of the RTC
On May 26, 2009, the RTC denied the petition3 for lack of merit based on the
ratiocinations that: (a) the Municipality of Naguilian is the declared owner of the
subject parcel of land by virtue of Tax Declaration No. 002-01197; (b) under Section
6A.01 of the Revenue Code of the Municipality of Naguilian, the municipality has the
right to require the petitioner to sign a contract of lease because its business operation
is being conducted on a real property owned by the municipality; and (c) a mayors
duty to issue business permits is discretionary in nature which may not be enforced by
a mandamus writ. The decretal portion of the decision reads:
WHEREFORE, premises considered, the petition is DENIED for lack of merit.
SO ORDERED.4
The Ruling of the CA
Unwaivering, the respondent appealed to the CA. In its Decision5 dated March 30,
2011, the CA held that the appeal was dismissible on the ground of mootness
considering that the period for which the business period was being sought had
already lapsed. As such, any ruling on the matter would bring no practical relief.
Nonetheless, the CA proceeded to resolve the issues involved in the appeal for
academic purposes.
The CA disagreed with the RTC and found that the factual milieu of the case justifies
the issuance of a writ of mandamus. The CA reasoned that the tax declaration in the
name of the municipality was insufficient basis to require the execution of a contract of
lease as a condition sine qua non for the renewal of a business permit. The CA further
observed that Sangguniang Bayan Resolution No. 2007-81, upon which the
municipality anchored its imposition of rental fees, was void because it failed to
comply with the requirements of the Local Government Code and its Implementing
Rules and Regulations.
The CA held that the petitioner may not be held liable for damages since his action or
inaction, for that matter, was done in the performance of official duties that are legally
protected by the presumption of good faith. The CA likewise stressed that the civil
action filed against the petitioner had already become moot and academic upon the
expiration of his term as the mayor of Naguilian, La Union.
Despite its incessant declarations on the mootness of the case, the CA disposed of
the appeal in this wise:
WHEREFORE, the Decision dated 26 May 2009 of the Regional Trial Court, First
Judicial Region, Bauang, La Union, Branch 67, in Special Civil Action Case No. 72-
BG, is hereby REVERSED and SET ASIDE.
SO ORDERED.6
The petitioner moved for reconsideration7 questioning the pronouncement of the CA
that Sangguniang Bayan Resolution No. 2007-81 was void and arguing that a petition
for mandamus is not the proper vehicle to determine the issue on the ownership of the
subject land. The motion was denied in the CA Resolution8 dated September 30,
2011.
The petitioner is now before this Court reiterating the arguments raised in his motion
for reconsideration.
Our Ruling
We agree with the CA that the petition for mandamus has already become moot and
academic owing to the expiration of the period intended to be covered by the business
permit.
An issue or a case becomes moot and academic when it ceases to present a
justiciable controversy so that a determination thereof would be without practical use
and value9 or in the nature of things, cannot be enforced. 10 In such cases, there is no
actual substantial relief to which the applicant would be entitled to and which would be
negated by the dismissal of the petition.11 As a rule, courts decline jurisdiction over
such case, or dismiss it on ground of mootness.12
The objective of the petition for mandamus to compel the petitioner to grant a
business permit in favor of respondent corporation for the period 2008 to 2009 has
already been superseded by the passage of time and the expiration of the petitioners
term as mayor. Verily then, the issue as to whether or not the petitioner, in his capacity
as mayor, may be compelled by a writ of mandamus to release the respondents
business permit ceased to present a justiciable controversy such that any ruling
thereon would serve no practical value. Should the writ be issued, the petitioner can
no longer abide thereby; also, the effectivity date of the business permit no longer
subsists.
While the CA is not precluded from proceeding to resolve the otherwise moot appeal
of the respondent, we find that the decretal portion of its decision was erroneously
couched.
The CAs conclusions on the issue of ownership over the subject land and the
invalidity of Sangguniang Bayan Resolution No. 2007-81, aside from being
unsubstantiated by convincing evidence, can no longer be practically utilized in favor
of the petitioner. Thus, the overriding and decisive factor in the final disposition of the
appeal was its mootness and the CA should have dismissed the same along with the
petition for mandamus that spawned it.
More importantly, a mayor cannot be compelled by mandamus to issue a business
permit since the exercise of the same is a delegated police power hence, discretionary
in nature. This was the pronouncement of this Court in Roble Arrastre, Inc. v. Hon.
Villaflor13 where a determination was made on the nature of the power of a mayor to
grant business permits under the Local Government Code, 14 viz:
Central to the resolution of the case at bar is a reading of Section 444(b)(3)(iv) of the
Local Government Code of 1991, which provides, thus:
SEC. 444. The Chief Executive: Powers, Duties, Functions and Compensation.
(b) For efficient, effective and economical governance the purpose of which
is the general welfare of the municipality and its inhabitants pursuant to
Section 16 of this Code, the municipal mayor shall:
xxxx
3) Initiate and maximize the generation of resources and revenues, and
apply the same to the implementation of development plans, program
objectives and priorities as provided for under Section 18 of this Code,
particularly those resources and revenues programmed for agro-industrial
development and country-wide growth and progress, and relative thereto,
shall:
xxxx
(iv) Issue licenses and permits and suspend or revoke the same for any
violation of the conditions upon which said licenses or permits had been
issued, pursuant to law or ordinance.
As Section 444(b)(3)(iv) so states, the power of the municipal mayor to issue licenses
is pursuant to Section 16 of the Local Government Code of 1991, which declares:
SEC. 16. General Welfare. Every local government unit shall exercise the powers
expressly granted, those necessarily implied therefrom, as well as powers necessary,
appropriate, or incidental for its efficient and effective governance, and those which
are essential to the promotion of the general welfare. Within their respective territorial
jurisdictions, local government units shall ensure and support, among other things, the
preservation and enrichment of culture, promote health and safety, enhance the right
of the people to a balanced ecology, encourage and support the development of
appropriate and self-reliant scientific and technological capabilities, improve public
morals, enhance economic prosperity and social justice, promote full employment
among their residents, maintain peace and order, and preserve the comfort and
convenience of their inhabitants.
Section 16, known as the general welfare clause, encapsulates the delegated police
power to local governments.1wphi1Local government units exercise police power
through their respective legislative bodies. Evidently, the Local Government Code of
1991 is unequivocal that the municipal mayor has the power to issue licenses and
permits and suspend or revoke the same for any violation of the conditions upon
which said licenses or permits had been issued, pursuant to law or ordinance. x x x
xxxx
Section 444(b)(3)(iv) of the Local Government Code of 1991, whereby the power of
the respondent mayor to issue license and permits is circumscribed, is a manifestation
of the delegated police power of a municipal corporation. Necessarily, the exercise
thereof cannot be deemed ministerial. As to the question of whether the power is
validly exercised, the matter is within the province of a writ of certiorari, but certainly,
not of mandamus.15 (Citations omitted)
Indeed, as correctly ruled by the RTC, the petition for mandamus filed by the
respondent is incompetent to compel the exercise of a mayors discretionary duty to
issue business permits.
WHEREFORE, premises considered, the Decision dated March 30, 2011 of the Court
of Appeals in CA-G.R. SP No. 112152 is hereby SET ASIDE. The Decision dated May
26, 2009 of the Regional Trial Court of Bauang, La Union is REINSTATED.
SO ORDERED.

EN BANC
G.R. No. 161107 March 12, 2013
HON. MA. LOURDES C. FERNANDO, in her capacity as City Mayor of Marikina
City, JOSEPHINE C. EVANGELIST A, in her capacity as Chief, Permit Division,
Office of the City Engineer, and ALFONSO ESPIRITU, in his capacity as City
Engineer of Marikina City, Petitioners,
vs.
ST. SCHOLASTICA'S COLLEGE and ST. SCHOLASTICA'S ACADEMY-
MARIKINA, INC., Respondents.
DECISION
MENDOZA, J.:
Before this Court is a petition for review on certiorari under Rule 45 of the Rules of
Court, which seeks to set aside the December 1, 2003 Decision 1 of the Court of
Appeals (CA) in CA-G.R. SP No. 75691.
The Facts
Respondents St. Scholasticas College (SSC) and St. Scholasticas Academy-
Marikina, Inc. (SSA-Marikina) are educational institutions organized under the laws of
the Republic of the Philippines, with principal offices and business addresses at Leon
Guinto Street, Malate, Manila, and at West Drive, Marikina Heights, Marikina City,
respectively.2
Respondent SSC is the owner of four (4) parcels of land measuring a total of
56,306.80 square meters, located in Marikina Heights and covered by Transfer
Certificate Title (TCT) No. 91537. Located within the property are SSA-Marikina, the
residence of the sisters of the Benedictine Order, the formation house of the novices,
and the retirement house for the elderly sisters. The property is enclosed by a tall
concrete perimeter fence built some thirty (30) years ago. Abutting the fence along the
West Drive are buildings, facilities, and other improvements.3
The petitioners are the officials of the City Government of Marikina. On September 30,
1994, the Sangguniang Panlungsod of Marikina City enacted Ordinance No.
192,4 entitled "Regulating the Construction of Fences and Walls in the Municipality of
Marikina." In 1995 and 1998, Ordinance Nos. 2175 and 2006 were enacted to amend
Sections 7 and 5, respectively. Ordinance No. 192, as amended, is reproduced
hereunder, as follows:
ORDINANCE No. 192
Series of 1994
ORDINANCE REGULATING THE CONSTRUCTION OF FENCES AND WALLS IN
THE MUNICIPALITY OF MARIKINA
WHEREAS, under Section 447.2 of Republic Act No. 7160 otherwise known as the
Local Government Code of 1991 empowers the Sangguniang Bayan as the local
legislative body of the municipality to "x x x Prescribe reasonable limits and restraints
on the use of property within the jurisdiction of the municipality, x x x";
WHEREAS the effort of the municipality to accelerate its economic and physical
development, coupled with urbanization and modernization, makes imperative the
adoption of an ordinance which shall embody up-to-date and modern technical design
in the construction of fences of residential, commercial and industrial buildings;
WHEREAS, Presidential Decree No. 1096, otherwise known as the National Building
Code of the Philippines, does not adequately provide technical guidelines for the
construction of fences, in terms of design, construction, and criteria;
WHEREAS, the adoption of such technical standards shall provide more efficient and
effective enforcement of laws on public safety and security;
WHEREAS, it has occurred in not just a few occasions that high fences or walls did
not actually discourage but, in fact, even protected burglars, robbers, and other
lawless elements from the view of outsiders once they have gained ingress into these
walls, hence, fences not necessarily providing security, but becomes itself a "security
problem";
WHEREAS, to discourage, suppress or prevent the concealment of prohibited or
unlawful acts earlier enumerated, and as guardian of the people of Marikina, the
municipal government seeks to enact and implement rules and ordinances to protect
and promote the health, safety and morals of its constituents;
WHEREAS, consistent too, with the "Clean and Green Program" of the government,
lowering of fences and walls shall encourage people to plant more trees and
ornamental plants in their yards, and when visible, such trees and ornamental plants
are expected to create an aura of a clean, green and beautiful environment for
Marikeos;
WHEREAS, high fences are unsightly that, in the past, people planted on sidewalks to
"beautify" the faade of their residences but, however, become hazards and
obstructions to pedestrians;
WHEREAS, high and solid walls as fences are considered "un-neighborly" preventing
community members to easily communicate and socialize and deemed to create
"boxed-in" mentality among the populace;
WHEREAS, to gather as wide-range of opinions and comments on this proposal, and
as a requirement of the Local Government Code of 1991 (R.A. 7160), the
Sangguniang Bayan of Marikina invited presidents or officers of homeowners
associations, and commercial and industrial establishments in Marikina to two public
hearings held on July 28, 1994 and August 25, 1994;
WHEREAS, the rationale and mechanics of the proposed ordinance were fully
presented to the attendees and no vehement objection was presented to the municipal
government;
NOW, THEREFORE, BE IT ORDAINED BY THE SANGGUINANG BAYAN OF
MARIKINA IN SESSION DULY ASSEMBLED:
Section 1. Coverage: This Ordinance regulates the construction of all fences, walls
and gates on lots classified or used for residential, commercial, industrial, or special
purposes.
Section 2. Definition of Terms:
 a. Front Yard refers to the area of the lot fronting a street, alley
or public thoroughfare.
b. Back Yard the part of the lot at the rear of the structure
constructed therein.
c. Open fence type of fence which allows a view of "thru-see" of
the inner yard and the improvements therein. (Examples: wrought
iron, wooden lattice, cyclone wire)
d. Front gate refers to the gate which serves as a passage of
persons or vehicles fronting a street, alley, or public thoroughfare.
Section 3. The standard height of fences or walls allowed under this ordinance are as
follows:
(1) Fences on the front yard shall be no more than one (1)
meter in height. Fences in excess of one (1) meter shall be of an
open fence type, at least eighty percent (80%) see-thru; and
(2) Fences on the side and back yard shall be in accordance
with the provisions of P.D. 1096 otherwise known as the National
Building Code.
Section 4. No fence of any kind shall be allowed in areas specifically reserved or
classified as parks.
Section 5. In no case shall walls and fences be built within the five (5) meter parking
area allowance located between the front monument line and the building line of
commercial and industrial establishments and educational and religious institutions. 7
Section 6. Exemption.
(1) The Ordinance does not cover perimeter walls of residential
subdivisions.
(2) When public safety or public welfare requires, the
Sangguniang Bayan may allow the construction and/or
maintenance of walls higher than as prescribed herein and shall
issue a special permit or exemption.
Section 7. Transitory Provision. Real property owners whose existing fences and walls
do not conform to the specifications herein are allowed adequate period of time from
the passage of this Ordinance within which to conform, as follows:
(1) Residential houses eight (8) years
(2) Commercial establishments five (5) years
(3) Industrial establishments three (3) years
(4) Educational institutions five (5) years8 (public and privately
owned)
Section 8. Penalty. Walls found not conforming to the provisions of this Ordinance
shall be demolished by the municipal government at the expense of the owner of the
lot or structure.
Section 9. The Municipal Engineering Office is tasked to strictly implement this
ordinance, including the issuance of the necessary implementing guidelines, issuance
of building and fencing permits, and demolition of non-conforming walls at the lapse of
the grace period herein provided.
Section 10. Repealing Clause. All existing Ordinances and Resolutions, Rules and
Regulations inconsistent with the foregoing provisions are hereby repealed, amended
or modified.
Section 11. Separability Clause. If for any reason or reasons, local executive orders,
rules and regulations or parts thereof in conflict with this Ordinance are hereby
repealed and/or modified accordingly.
Section 12. Effectivity. This ordinance takes effect after publication.
APPROVED: September 30, 1994
(Emphases supplied)
On April 2, 2000, the City Government of Marikina sent a letter to the respondents
ordering them to demolish and replace the fence of their Marikina property to make it
80% see-thru, and, at the same time, to move it back about six (6) meters to provide
parking space for vehicles to park.9 On April 26, 2000, the respondents requested for
an extension of time to comply with the directive.10 In response, the petitioners,
through then City Mayor Bayani F. Fernando, insisted on the enforcement of the
subject ordinance.
Not in conformity, the respondents filed a petition for prohibition with an application for
a writ of preliminary injunction and temporary restraining order before the Regional
Trial Court, Marikina, Branch 273 (RTC), docketed as SCA Case No. 2000-381-MK.11
The respondents argued that the petitioners were acting in excess of jurisdiction in
enforcing Ordinance No. 192, asserting that such contravenes Section 1, Article III of
the 1987 Constitution. That demolishing their fence and constructing it six (6) meters
back would result in the loss of at least 1,808.34 square meters, worth
aboutP9,041,700.00, along West Drive, and at least 1,954.02 square meters, worth
roughly P9,770,100.00, along East Drive. It would also result in the destruction of the
garbage house, covered walk, electric house, storage house, comfort rooms, guards
room, guards post, waiting area for visitors, waiting area for students, Blessed Virgin
Shrine, P.E. area, and the multi-purpose hall, resulting in the permanent loss of their
beneficial use. The respondents, thus, asserted that the implementation of the
ordinance on their property would be tantamount to an appropriation of property
without due process of law; and that the petitioners could only appropriate a portion of
their property through eminent domain. They also pointed out that the goal of the
provisions to deter lawless elements and criminality did not exist as the solid concrete
walls of the school had served as sufficient protection for many years.12
The petitioners, on the other hand, countered that the ordinance was a valid exercise
of police power, by virtue of which, they could restrain property rights for the protection
of public safety, health, morals, or the promotion of public convenience and general
prosperity.13
On June 30, 2000, the RTC issued a writ of preliminary injunction, enjoining the
petitioners from implementing the demolition of the fence at SSCs Marikina
property.14
Ruling of the RTC
On the merits, the RTC rendered a Decision,15 dated October 2, 2002, granting the
petition and ordering the issuance of a writ of prohibition commanding the petitioners
to permanently desist from enforcing or implementing Ordinance No. 192 on the
respondents property.
The RTC agreed with the respondents that the order of the petitioners to demolish the
fence at the SSC property in Marikina and to move it back six (6) meters would
amount to an appropriation of property which could only be done through the exercise
of eminent domain. It held that the petitioners could not take the respondents property
under the guise of police power to evade the payment of just compensation.
It did not give weight to the petitioners contention that the parking space was for the
benefit of the students and patrons of SSA-Marikina, considering that the respondents
were already providing for sufficient parking in compliance with the standards under
Rule XIX of the National Building Code.
It further found that the 80% see-thru fence requirement could run counter to the
respondents right to privacy, considering that the property also served as a residence
of the Benedictine sisters, who were entitled to some sense of privacy in their affairs. It
also found that the respondents were able to prove that the danger to security had no
basis in their case. Moreover, it held that the purpose of beautification could not be
used to justify the exercise of police power.
It also observed that Section 7 of Ordinance No. 192, as amended, provided for
retroactive application. It held, however, that such retroactive effect should not impair
the respondents vested substantive rights over the perimeter walls, the six-meter
strips of land along the walls, and the building, structures, facilities, and
improvements, which would be destroyed by the demolition of the walls and the
seizure of the strips of land.
The RTC also found untenable the petitioners argument that Ordinance No. 192 was
a remedial or curative statute intended to correct the defects of buildings and
structures, which were brought about by the absence or insufficiency of laws. It ruled
that the assailed ordinance was neither remedial nor curative in nature, considering
that at the time the respondents perimeter wall was built, the same was valid and
legal, and the ordinance did not refer to any previous legislation that it sought to
correct.
The RTC noted that the petitioners could still take action to expropriate the subject
property through eminent domain.
The RTC, thus, disposed:
WHEREFORE, the petition is GRANTED. The writ of prohibition is hereby issued
commanding the respondents to permanently desist from enforcing or implementing
Ordinance No. 192, Series of 1994, as amended, on petitioners property in question
located at Marikina Heights, Marikina, Metro Manila.
No pronouncement as to costs.
SO ORDERED.16
Ruling of the CA
In its December 1, 2003 Decision, the CA dismissed the petitioners appeal and
affirmed the RTC decision.
The CA reasoned out that the objectives stated in Ordinance No. 192 did not justify
the exercise of police power, as it did not only seek to regulate, but also involved the
taking of the respondents property without due process of law. The respondents were
bound to lose an unquantifiable sense of security, the beneficial use of their
structures, and a total of 3,762.36 square meters of property. It, thus, ruled that the
assailed ordinance could not be upheld as valid as it clearly invaded the personal and
property rights of the respondents and "[f]or being unreasonable, and undue restraint
of trade."17
It noted that although the petitioners complied with procedural due process in enacting
Ordinance No. 192, they failed to comply with substantive due process. Hence, the
failure of the respondents to attend the public hearings in order to raise objections did
not amount to a waiver of their right to question the validity of the ordinance.
The CA also shot down the argument that the five-meter setback provision for parking
was a legal easement, the use and ownership of which would remain with, and inure
to, the benefit of the respondents for whom the easement was primarily intended. It
found that the real intent of the setback provision was to make the parking space free
for use by the public, considering that such would cease to be for the exclusive use of
the school and its students as it would be situated outside school premises and
beyond the school administrations control.
In affirming the RTC ruling that the ordinance was not a curative statute, the CA found
that the petitioner failed to point out any irregularity or invalidity in the provisions of the
National Building Code that required correction or cure. It noted that any correction in
the Code should be properly undertaken by the Congress and not by the City Council
of Marikina through an ordinance.
The CA, thus, disposed:
WHEREFORE, all foregoing premises considered, the instant appeal is
DENIED.1wphi1 The October 2, 2002 Decision and the January 13, 2003 Order of
the Regional Trial Court (RTC) of Marikina City, Branch 273, granting petitioners-
appellees petition for Prohibition in SCA Case No. 2000-381-MK are hereby
AFFIRMED.
SO ORDERED.18
Aggrieved by the decision of the CA, the petitioners are now before this Court
presenting the following
ASSIGNMENT OF ERRORS
 1. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED
IN DECLARING THAT CITY ORDINANCE NO. 192, SERIES OF 1994 IS
NOT A VALID EXERCISE OF POLICE POWER;
2. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED
IN RULING THAT THE AFOREMENTIONED ORDINANCE IS AN
EXERCISE OF THE CITY OF THE POWER OF EMINENT DOMAIN;
3. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED
IN DECLARING THAT THE CITY VIOLATED THE DUE PROCESS
CLAUSE IN IMPLEMENTING ORDINANCE NO. 192, SERIES OF 1994;
AND
4. WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED
IN RULING THAT THE ABOVE-MENTIONED ORDINANCE CANNOT BE
GIVEN RETROACTIVE APPLICATION.19
In this case, the petitioners admit that Section 5 of the assailed ordinance, pertaining
to the five-meter setback requirement is, as held by the lower courts,
invalid.20 Nonetheless, the petitioners argue that such invalidity was subsequently
cured by Zoning Ordinance No. 303, series of 2000. They also contend that Section 3,
relating to the 80% see-thru fence requirement, must be complied with, as it remains
to be valid.
Ruling of the Court
The ultimate question before the Court is whether Sections 3.1 and 5 of Ordinance
No. 192 are valid exercises of police power by the City Government of Marikina.
"Police power is the plenary power vested in the legislature to make statutes and
ordinances to promote the health, morals, peace, education, good order or safety and
general welfare of the people."21 The State, through the legislature, has delegated the
exercise of police power to local government units, as agencies of the State. This
delegation of police power is embodied in Section 1622 of the Local Government Code
of 1991 (R.A. No. 7160), known as the General Welfare Clause, 23 which has two
branches. "The first, known as the general legislative power, authorizes the municipal
council to enact ordinances and make regulations not repugnant to law, as may be
necessary to carry into effect and discharge the powers and duties conferred upon the
municipal council by law. The second, known as the police power proper, authorizes
the municipality to enact ordinances as may be necessary and proper for the health
and safety, prosperity, morals, peace, good order, comfort, and convenience of the
municipality and its inhabitants, and for the protection of their property."24
White Light Corporation v. City of Manila,25 discusses the test of a valid ordinance:
The test of a valid ordinance is well established. A long line of decisions including City
of Manila has held that for an ordinance to be valid, it must not only be within the
corporate powers of the local government unit to enact and pass according to the
procedure prescribed by law, it must also conform to the following substantive
requirements: (1) must not contravene the
Constitution or any statute; (2) must not be unfair or oppressive; (3) must not be partial
or discriminatory; (4) must not prohibit but may regulate trade; (5) must be general and
consistent with public policy; and (6) must not be unreasonable. 26
Ordinance No. 192 was passed by the City Council of Marikina in the apparent
exercise of its police power. To successfully invoke the exercise of police power as the
rationale for the enactment of an ordinance and to free it from the imputation of
constitutional infirmity, two tests have been used by the Court the rational
relationship test and the strict scrutiny test:
We ourselves have often applied the rational basis test mainly in analysis of equal
protection challenges. Using the rational basis examination, laws or ordinances are
upheld if they rationally further a legitimate governmental interest. Under intermediate
review, governmental interest is extensively examined and the availability of less
restrictive measures is considered. Applying strict scrutiny, the focus is on the
presence of compelling, rather than substantial, governmental interest and on the
absence of less restrictive means for achieving that interest. 27
Even without going to a discussion of the strict scrutiny test, Ordinance No. 192,
series of 1994 must be struck down for not being reasonably necessary to accomplish
the Citys purpose. More importantly, it is oppressive of private rights.
Under the rational relationship test, an ordinance must pass the following requisites as
discussed in Social Justice Society (SJS) v. Atienza, Jr.:28
As with the State, local governments may be considered as having properly exercised
their police power only if the following requisites are met: (1) the interests of the public
generally, as distinguished from those of a particular class, require its exercise and (2)
the means employed are reasonably necessary for the accomplishment of the
purpose and not unduly oppressive upon individuals. In short, there must be a
concurrence of a lawful subject and lawful method.29
Lacking a concurrence of these two requisites, the police power measure shall be
struck down as an arbitrary intrusion into private rights and a violation of the due
process clause.30
Section 3.1 and 5 of the assailed ordinance are pertinent to the issue at hand, to wit:
Section 3. The standard height of fences of walls allowed under this ordinance are as
follows:
(1) Fences on the front yard shall be no more than one (1) meter in height. Fences
in excess of one (1) meter shall be an open fence type, at least eighty percent (80%)
see-thru;
xxx xxx xxx
Section 5. In no case shall walls and fences be built within the five (5) meter parking
area allowance located between the front monument line and the building line of
commercial and industrial establishments and educational and religious institutions.
The respondents, thus, sought to prohibit the petitioners from requiring them to (1)
demolish their existing concrete wall, (2) build a fence (in excess of one meter) which
must be 80% see-thru, and (3) build the said fence six meters back in order to provide
a parking area.
Setback Requirement
The Court first turns its attention to Section 5 which requires the five-meter setback of
the fence to provide for a parking area. The petitioners initially argued that the
ownership of the parking area to be created would remain with the respondents as it
would primarily be for the use of its students and faculty, and that its use by the public
on non-school days would only be incidental. In their Reply, however, the petitioners
admitted that Section 5 was, in fact, invalid for being repugnant to the Constitution.31
The Court agrees with the latter position.
The Court joins the CA in finding that the real intent of the setback requirement was to
make the parking space free for use by the public, considering that it would no longer
be for the exclusive use of the respondents as it would also be available for use by the
general public. Section 9 of Article III of the 1987 Constitution, a provision on eminent
domain, provides that private property shall not be taken for public use without just
compensation.
The petitioners cannot justify the setback by arguing that the ownership of the property
will continue to remain with the respondents. It is a settled rule that neither the
acquisition of title nor the total destruction of value is essential to taking. In fact, it is
usually in cases where the title remains with the private owner that inquiry should be
made to determine whether the impairment of a property is merely regulated or
amounts to a compensable taking.32 The Court is of the view that the implementation
of the setback requirement would be tantamount to a taking of a total of 3,762.36
square meters of the respondents private property for public use without just
compensation, in contravention to the Constitution.
Anent the objectives of prevention of concealment of unlawful acts and "un-
neighborliness," it is obvious that providing for a parking area has no logical
connection to, and is not reasonably necessary for, the accomplishment of these
goals.
Regarding the beautification purpose of the setback requirement, it has long been
settled that the State may not, under the guise of police power, permanently divest
owners of the beneficial use of their property solely to preserve or enhance the
aesthetic appearance of the community.33 The Court, thus, finds Section 5 to be
unreasonable and oppressive as it will substantially divest the respondents of the
beneficial use of their property solely for aesthetic purposes. Accordingly, Section 5 of
Ordinance No. 192 is invalid.
The petitioners, however, argue that the invalidity of Section 5 was properly cured by
Zoning Ordinance No. 303, Series of 2000, which classified the respondents property
to be within an institutional zone, under which a five-meter setback has been required.
The petitioners are mistaken. Ordinance No. 303, Series of 2000, has no bearing to
the case at hand.
The Court notes with displeasure that this argument was only raised for the first time
on appeal in this Court in the petitioners Reply. Considering that Ordinance No. 303
was enacted on December 20, 2000, the petitioners could very well have raised it in
their defense before the RTC in 2002. The settled rule in this jurisdiction is that a party
cannot change the legal theory of this case under which the controversy was heard
and decided in the trial court. It should be the same theory under which the review on
appeal is conducted. Points of law, theories, issues, and arguments not adequately
brought to the attention of the lower court will not be ordinarily considered by a
reviewing court, inasmuch as they cannot be raised for the first time on appeal. This
will be offensive to the basic rules of fair play, justice, and due process. 35
Furthermore, the two ordinances have completely different purposes and subjects.
Ordinance No. 192 aims to regulate the construction of fences, while Ordinance No.
303 is a zoning ordinance which classifies the city into specific land uses. In fact, the
five-meter setback required by Ordinance No. 303 does not even appear to be for the
purpose of providing a parking area.
By no stretch of the imagination, therefore, can Ordinance No. 303, "cure" Section 5 of
Ordinance No. 192.
In any case, the clear subject of the petition for prohibition filed by the respondents is
Ordinance No. 192 and, as such, the precise issue to be determined is whether the
petitioners can be prohibited from enforcing the said ordinance, and no other, against
the respondents.
80% See-Thru Fence Requirement
The petitioners argue that while Section 5 of Ordinance No. 192 may be invalid,
Section 3.1 limiting the height of fences to one meter and requiring fences in excess of
one meter to be at least 80% see-thru, should remain valid and enforceable against
the respondents.
The Court cannot accommodate the petitioner.
For Section 3.1 to pass the rational relationship test, the petitioners must show the
reasonable relation between the purpose of the police power measure and the means
employed for its accomplishment, for even under the guise of protecting the public
interest, personal rights and those pertaining to private property will not be permitted
to be arbitrarily invaded.
The principal purpose of Section 3.1 is "to discourage, suppress or prevent the
concealment of prohibited or unlawful acts." The ultimate goal of this objective is
clearly the prevention of crime to ensure public safety and security. The means
employed by the petitioners, however, is not reasonably necessary for the
accomplishment of this purpose and is unduly oppressive to private rights. The
petitioners have not adequately shown, and it does not appear obvious to this Court,
that an 80% see-thru fence would provide better protection and a higher level of
security, or serve as a more satisfactory criminal deterrent, than a tall solid concrete
wall. It may even be argued that such exposed premises could entice and tempt
would-be criminals to the property, and that a see-thru fence would be easier to
bypass and breach. It also appears that the respondents concrete wall has served as
more than sufficient protection over the last 40 years. `
As to the beautification purpose of the assailed ordinance, as previously discussed,
the State may not, under the guise of police power, infringe on private rights solely for
the sake of the aesthetic appearance of the community. Similarly, the Court cannot
perceive how a see-thru fence will foster "neighborliness" between members of a
community.
Compelling the respondents to construct their fence in accordance with the assailed
ordinance is, thus, a clear encroachment on their right to property, which necessarily
includes their right to decide how best to protect their property.
It also appears that requiring the exposure of their property via a see-thru fence is
violative of their right to privacy, considering that the residence of the Benedictine
nuns is also located within the property. The right to privacy has long been considered
a fundamental right guaranteed by the Constitution that must be protected from
intrusion or constraint. The right to privacy is essentially the right to be let alone, 37 as
governmental powers should stop short of certain intrusions into the personal life of its
citizens.38 It is inherent in the concept of liberty, enshrined in the Bill of Rights (Article
III) in Sections 1, 2, 3(1), 6, 8, and 17, Article III of the 1987 Constitution. 39
The enforcement of Section 3.1 would, therefore, result in an undue interference with
the respondents rights to property and privacy. Section 3.1 of Ordinance No. 192 is,
thus, also invalid and cannot be enforced against the respondents.
No Retroactivity
Ordinance No. 217 amended Section 7 of Ordinance No. 192 by including the
regulation of educational institutions which was unintentionally omitted, and giving said
educational institutions five (5) years from the passage of Ordinance No. 192 (and not
Ordinance No. 217) to conform to its provisions.40 The petitioners argued that the
amendment could be retroactively applied because the assailed ordinance is a
curative statute which is retroactive in nature.
Considering that Sections 3.1 and 5 of Ordinance No. 192 cannot be enforced against
the respondents, it is no longer necessary to rule on the issue of retroactivity. The
Court shall, nevertheless, pass upon the issue for the sake of clarity.
"Curative statutes are enacted to cure defects in a prior law or to validate legal
proceedings which would otherwise be void for want of conformity with certain legal
requirements. They are intended to supply defects, abridge superfluities and curb
certain evils. They are intended to enable persons to carry into effect that which they
have designed or intended, but has failed of expected legal consequence by reason of
some statutory disability or irregularity in their own action. They make valid that which,
before the enactment of the statute was invalid. Their purpose is to give validity to acts
done that would have been invalid under existing laws, as if existing laws have been
complied with. Curative statutes, therefore, by their very essence, are retroactive."41
The petitioners argue that Ordinance No. 192 is a curative statute as it aims to correct
or cure a defect in the National Building Code, namely, its failure to provide for
adequate guidelines for the construction of fences. They ultimately seek to remedy an
insufficiency in the law. In aiming to cure this insufficiency, the petitioners attempt to
add lacking provisions to the National Building Code. This is not what is contemplated
by curative statutes, which intend to correct irregularities or invalidity in the law. The
petitioners fail to point out any irregular or invalid provision. As such, the assailed
ordinance cannot qualify as curative and retroactive in nature.
At any rate, there appears to be no insufficiency in the National Building Code with
respect to parking provisions in relation to the issue of the respondents. Paragraph
1.16.1, Rule XIX of the Rules and Regulations of the said code requires an
educational institution to provide one parking slot for every ten classrooms. As found
by the lower courts, the respondents provide a total of 76 parking slots for their 80
classrooms and, thus, had more than sufficiently complied with the law.
Ordinance No. 192, as amended, is, therefore, not a curative statute which may be
applied retroactively.
Separability
Sections 3.1 and 5 of Ordinance No. 192, as amended, are, thus, invalid and cannot
be enforced against the respondents. Nonetheless, "the general rule is that where part
of a statute is void as repugnant to the Constitution, while another part is valid, the
valid portion, if susceptible to being separated from the invalid, may stand and be
enforced."42 Thus, the other sections of the assailed ordinance remain valid and
enforceable.
Conclusion
Considering the invalidity of Sections 3.1 and 5, it is clear that the petitioners were
acting in excess of their jurisdiction in enforcing Ordinance No. 192 against the
respondents. The CA was correct in affirming the decision of the RTC in issuing the
writ of prohibition. The petitioners must permanently desist from enforcing Sections
3.1 and 5 of the assailed ordinance on the respondents' property in Marikina City.
WHEREFORE, the petition is DENIED. The October 2, 2002 Decision of the Regional
Trial Court in SCA Case No. 2000-381-MK is AFFIRMED but MODIFIED to read as
follows:
WHEREFORE, the petition is GRANTED. The writ of prohibition is hereby issued
commanding the respondents to permanently desist from enforcing or implementing
Sections 3.1 and 5 of Ordinance No. 192, Series of 1994, as amended, on the
petitioners' property in question located in Marikina Heights, Marikina, Metro Manila.
No pronouncement as to costs.
SO ORDERED.
EN BANC
G.R. No. 159110, December 10, 2013
VALENTINO L. LEGASPI, Petitioner, v. CITY OF CEBU, T.C. (TITO) SAYSON AND
RICARDO HAPITAN, Respondents.
[G.R. No. 159692]
BIENVENIDO P. JABAN, SR., AND BIENVENIDO DOUGLAS LUKE BRADBURY
JABAN, Petitioners,v. COURT OF APPEALS, CITY OF CEBU, CITY MAYOR ALVIN
GARCIA, SANGGUNIANG PANLUNSOD OF CITY OF CEBU, HON. RENATO V.
OSMEA, AS PRESIDING OFFICER OF THE SANGGUNIANG PANLUNSOD, AND
CITOM CHAIRMAN ALAN GAVIOLA, AS CITOM CHIEF, CITOM TRAFFIC
ENFORCER E. A. ROMERO, AND LITO GILBUENA, Respondents.
DECISION
BERSAMIN, J.:
The goal of the decentralization of powers to the local government units (LGUs) is to
ensure the enjoyment by each of the territorial and political subdivisions of the State of
a genuine and meaningful local autonomy. To attain the goal, the National Legislature
has devolved the three great inherent powers of the State to the LGUs. Each political
subdivision is thereby vested with such powers subject to constitutional and statutory
limitations.
In particular, the Local Government Code (LGC) has expressly empowered the LGUs
to enact and adopt ordinances to regulate vehicular traffic and to prohibit illegal
parking within their jurisdictions. Now challenged before the Court are the
constitutionality and validity of one such ordinance on the ground that the ordinance
constituted a contravention of the guaranty of due process under the Constitution by
authorizing the immobilization of offending vehicles through the clamping of tires. The
challenge originated in the Regional Trial Court (RTC) at the instance of the
petitioners vehicle owners who had borne the brunt of the implementation of the
ordinance with the RTC declaring the ordinance unconstitutional, but it has now
reached the Court as a consolidated appeal taken in due course by the petitioners
after the Court of Appeals (CA) reversed the judgment of the RTC.
Antecedents
On January 27, 1997 the Sangguniang Panlungsod of the City of Cebu enacted
Ordinance No. 1664 to authorize the traffic enforcers of Cebu City to immobilize any
motor vehicle violating the parking restrictions and prohibitions defined in Ordinance
No. 801 (Traffic Code of Cebu City).1 The pertinent provisions of Ordinance No. 1664
read:chanRoblesvirtualLawlibrary
Section 1. POLICY It is the policy of the government of the City of Cebu to
immobilize any motor vehicle violating any provision of any City Ordinance on Parking
Prohibitions or Restrictions, more particularly Ordinance No. 801, otherwise known as
the Traffic Code of Cebu City, as amended, in order to have a smooth flow of
vehicular traffic in all the streets in the City of Cebu at all times.
Section 2. IMMOBILIZATION OF VEHICLES Any vehicle found violating any
provision of any existing ordinance of the City of Cebu which prohibits, regulates or
restricts the parking of vehicles shall be immobilized by clamping any tire of the said
violating vehicle with the use of a denver boot vehicle immobilizer or any other special
gadget designed to immobilize motor vehicles. For this particular purpose, any traffic
enforcer of the City (regular PNP Personnel or Cebu City Traffic Law Enforcement
Personnel) is hereby authorized to immobilize any violating vehicle as hereinabove
provided.
Section 3. PENALTIES Any motor vehicle, owner or driver violating any ordinance
on parking prohibitions, regulations and/or restrictions, as may be provided under
Ordinance No. 801, as amended, or any other existing ordinance, shall be penalized
in accordance with the penalties imposed in the ordinance so violated, provided that
the vehicle immobilizer may not be removed or released without its owner or driver
paying first to the City Treasurer of Cebu City through the Traffic Violations Bureau
(TVB) all the accumulated penalties for all prior traffic law violations that remain
unpaid or unsettled, plus the administrative penalty of Five Hundred Pesos (P500.00)
for the immobilization of the said vehicle, and receipts of such payments presented to
the concerned personnel of the bureau responsible for the release of the immobilized
vehicle, unless otherwise ordered released by any of the following
officers:chanRoblesvirtualLawlibrary
a) Chairman, CITOM
b) Chairman, Committee on Police, Fire and Penology
c) Asst. City Fiscal Felipe Belcia
3.1 Any person who tampers or tries to release an immobilized or clamped motor
vehicle by destroying the denver boot vehicle immobilizer or other such special
gadgets, shall be liable for its loss or destruction and shall be prosecuted for such loss
or destruction under pain or penalty under the Revised Penal Code and any other
existing ordinance of the City of Cebu for the criminal act, in addition to his/her civil
liabilities under the Civil Code of the Philippines; Provided that any such act may not
be compromised nor settled amicably extrajudicially.
3.2 Any immobilized vehicle which is unattended and constitute an obstruction to the
free flow of traffic or a hazard thereof shall be towed to the city government
impounding area for safekeeping and may be released only after the provision of
Section 3 hereof shall have been fully complied with.
3.3 Any person who violates any provision of this ordinance shall, upon conviction, be
penalized with imprisonment of not less than one (1) month nor more than six (6)
months or of a fine of not less than Two Thousand Pesos (P2,000.00) nor more than
Five Thousand Pesos (P5,000.00), or both such imprisonment and fine at the
discretion of the court.2ChanRoblesVirtualawlibrary
On July 29, 1997, Atty. Bienvenido Jaban (Jaban, Sr.) and his son Atty. Bienvenido
Douglas Luke Bradbury Jaban (Jaban, Jr.) brought suit in the RTC in Cebu City
against the City of Cebu, then represented by Hon. Alvin Garcia, its City Mayor, the
Sangguniang Panlungsod of Cebu City and its Presiding Officer, Hon. Renato V.
Osmea, and the chairman and operatives or officers of the City Traffic Operations
Management (CITOM), seeking the declaration of Ordinance No. 1644 as
unconstitutional for being in violation of due process and for being contrary to law, and
damages.3Their complaint alleged that on June 23, 1997, Jaban Sr. had properly
parked his car in a paying parking area on Manalili Street, Cebu City to get certain
records and documents from his office;4 that upon his return after less than 10
minutes, he had found his car being immobilized by a steel clamp, and a notice being
posted on the car to the effect that it would be a criminal offense to break the
clamp;5 that he had been infuriated by the immobilization of his car because he had
been thereby rendered unable to meet an important client on that day; that his car was
impounded for three days, and was informed at the office of the CITOM that he had
first to pay P4,200.00 as a fine to the City Treasurer of Cebu City for the release of his
car;6 that the fine was imposed without any court hearing and without due process of
law, for he was not even told why his car had been immobilized; that he had
undergone a similar incident of clamping of his car on the early morning of November
20, 1997 while his car was parked properly in a parking lot in front of the San Nicolas
Pasil Market in Cebu City without violating any traffic regulation or causing any
obstruction; that he was compelled to pay P1,500.00 (itemized as P500.00 for the
clamping and P1,000.00 for the violation) without any court hearing and final
judgment; that on May 19, 1997, Jaban, Jr. parked his car in a very secluded place
where there was no sign prohibiting parking; that his car was immobilized by CITOM
operative Lito Gilbuena; and that he was compelled to pay the total sum of P1,400.00
for the release of his car without a court hearing and a final judgment rendered by a
court of justice.7cralawred
On August 11, 1997, Valentino Legaspi (Legaspi) likewise sued in the RTC the City of
Cebu, T.C. Sayson, Ricardo Hapitan and John Does to demand the delivery of
personal property, declaration of nullity of the Traffic Code of Cebu City, and
damages.8 He averred that on the morning of July 29, 1997, he had left his car
occupying a portion of the sidewalk and the street outside the gate of his house to
make way for the vehicle of the anay exterminator who had asked to be allowed to
unload his materials and equipment from the front of the residence inasmuch as his
daughters car had been parked in the carport, with the assurance that the unloading
would not take too long;9 that while waiting for the anay exterminator to finish
unloading, the phone in his office inside the house had rung, impelling him to go into
the house to answer the call; that after a short while, his soninlaw informed him that
unknown persons had clamped the front wheel of his car; 10 that he rushed outside and
found a traffic citation stating that his car had been clamped by CITOM
representatives with a warning that the unauthorized removal of the clamp would
subject the remover to criminal charges;11 and that in the late afternoon a group
headed by Ricardo Hapitan towed the car even if it was not obstructing the flow of
traffic.12
13
In separate answers for the City of Cebu and its codefendants, the City Attorney of
Cebu presented similar defenses, essentially stating that the traffic enforcers had only
upheld the law by clamping the vehicles of the plaintiffs;14 and that Ordinance No.
1664 enjoyed the presumption of constitutionality and validity. 15
The cases were consolidated before Branch 58 of the RTC, which, after trial, rendered
on January 22, 1999 its decision declaring Ordinance No. 1664 as null and void upon
the following ratiocination:chanRoblesvirtualLawlibrary
In clear and simple phrase, the essence of due process was expressed by Daniel
Webster as a law which hears before it condemns. In another case[s], procedural
due process is that which hears before it condemns, which proceeds upon inquiry and
renders judgment only after trial. It contemplate(s) notice and opportunity to be heard
before judgment is rendered affecting ones (sic) person or property. In both
procedural and substantive due process, a hearing is always a prerequisite, hence,
the taking or deprivation of ones life, liberty or property must be done upon and with
observance of the due process clause of the Constitution and the nonobservance
or violation thereof is, perforce, unconstitutional.
Under Ordinance No. 1664, when a vehicle is parked in a prohibited, restrycted (sic)
or regulated area in the street or along the street, the vehicle is immobilized by
clamping any tire of said vehicle with the use of a denver boot vehicle immobilizer or
any other special gadget which immobilized the motor vehicle. The violating vehicle is
immobilized, thus, depriving its owner of the use thereof at the sole determination of
any traffic enforcer or regular PNP personnel or Cebu City Traffic Law Enforcement
Personnel. The vehicle immobilizer cannot be removed or released without the owner
or driver paying first to the City Treasurer of Cebu through the Traffic Violations
Bureau all the accumulated penalties of all unpaid or unsettled traffic law violations,
plus the administrative penalty of P500.00 and, further, the immobilized vehicle shall
be released only upon presentation of the receipt of said payments and upon release
order by the Chairman, CITOM, or Chairman, Committee on Police, Fire and
Penology, or Asst. City Fiscal Felipe Belcina. It should be stressed that the owner of
the immobilized vehicle shall have to undergo all these ordeals at the mercy of the
Traffic Law Enforcer who, as the Ordinance in question mandates, is the arresting
officer, prosecutor, Judge and collector. Otherwise stated, the owner of the
immobilized motor vehicle is deprived of his right to the use of his/her vehicle and
penalized without a hearing by a person who is not legally or duly vested with such
rights, power or authority. The Ordinance in question is penal in nature, and it has
been held;
x x x
WHEREFORE, premised (sic) considered, judgment is hereby rendered declaring
Ordinance No. 1664 unconstitutional and directing the defendant City of Cebu to pay
the plaintiff Valentino Legaspi the sum of P110,000.00 representing the value of his
car, and to all the plaintiffs, Valentino L. Legaspi, Bienvenido P. Jaban and Bienvenido
Douglas Luke Bradbury Jaban, the sum of P100,000.00 each or P300,000.00 all as
nominal damages and another P100,000.00 each or P300,000.00 all as temperate or
moderate damages. With costs against defendant City of Cebu.
SO ORDERED.16 (citations omitted)chanroblesvirtualawlibrary
The City of Cebu and its codefendants appealed to the CA, assigning the following
errors to the RTC, namely: (a) the RTC erred in declaring that Ordinance No. 1664
was unconstitutional; (b) granting,arguendo, that Ordinance No. 1664 was
unconstitutional, the RTC gravely erred in holding that any violation prior to its
declaration as being unconstitutional was irrelevant; (c) granting, arguendo, that
Ordinance No. 1664 was unconstitutional, the RTC gravely erred in awarding
damages to the plaintiffs; (d) granting, arguendo, that the plaintiffs were entitled to
damages, the damages awarded were excessive and contrary to law; and (e) the
decision of the RTC was void, because the Office of the Solicitor General (OSG) had
not been notified of the proceedings.
On June 16, 2003, the CA promulgated its assailed decision,17 overturning the RTC
and declaring Ordinance No. 1664 valid, to wit:chanRoblesvirtualLawlibrary
The principal thrust of this appeal is the constitutionality of Ordinance 1664.
Defendantsappellants contend that the passage of Ordinance 1664 is in accordance
with the police powers exercised by the City of Cebu through the Sangguniang
Panlungsod and granted by RA 7160, otherwise known as the Local Government
Code. A thematic analysis of the law on municipal corporations confirms this view. As
in previous legislation, the Local Government Code delegates police powers to the
local governments in two ways. Firstly, it enumerates the subjects on which the
Sangguniang Panlungsod may exercise these powers. Thus, with respect to the use
of public streets, Section 458 of the Code states:chanRoblesvirtualLawlibrary
Section 458 (a) The sangguniang panlungsod, as the legislative branch of the city, x x
x shall x x x

(5) (v) Regulate the use of streets, avenues, alleys, sidewalks, bridges, park and other
public places and approve the construction, improvement, repair and maintenance of
the same; establish bus and vehicle stops and terminals or regulate the use of the
same by privately owned vehicles which serve the public; regulate garages and the
operation of conveyances for hire; designate stands to be occupied by public vehicles
when not in use; regulate the putting up of signs, signposts, awnings and awning
posts on the streets; and provide for the lighting, cleaning and sprinkling of streets and
public places;
(vi) Regulate traffic on all streets and bridges; prohibit encroachments or obstacles
thereon and, when necessary in the interest of public welfare, authorize the removal of
encroachments and illegal constructions in public places.
It then makes a general grant of the police power. The scope of the legislative
authority of the local government is set out in Section 16, to
wit:chanRoblesvirtualLawlibrary
Section 16. General Welfare. Every local government unit shall exercise the powers
expressly granted, those necessarily implied therefrom, as well as powers necessary,
appropriate, or incidental for its efficient and effective governance, and those which
are essential to the promotion of the general welfare.
This provision contains what is traditionally known as the general welfare clause. As
expounded in United States vs. Salaveria, 39 Phil 102, the general welfare clause has
two branches. One branch attaches itself to the main trunk of municipal authority, and
relates to such ordinances and regulations as may be necessary to carry into effect
and discharge the powers and duties conferred upon the municipal council by law.
The second branch of the clause is much more independent of the specific functions
of the council, and authorizes such ordinances as shall seem necessary and proper to
provide for health, safety, prosperity and convenience of the municipality and its
inhabitants.
In a vital and critical way, the general welfare clause complements the more specific
powers granted a local government. It serves as a catchall provision that ensures
that the local government will be equipped to meet any local contingency that bears
upon the welfare of its constituents but has not been actually anticipated. So varied
and protean are the activities that affect the legitimate interests of the local inhabitants
that it is wellnigh impossible to say beforehand what may or may not be done
specifically through law. To ensure that a local government can react positively to the
peoples needs and expectations, the general welfare clause has been devised and
interpreted to allow the local legislative council to enact such measures as the
occasion requires.
Founded on clear authority and tradition, Ordinance 1664 may be deemed a legitimate
exercise of the police powers of the Sangguniang Panlungsod of the City of Cebu.
This local law authorizes traffic enforcers to immobilize and tow for safekeeping
vehicles on the streets that are illegally parked and to release them upon payment of
the announced penalties. As explained in the preamble, it has become necessary to
resort to these measures because of the traffic congestion caused by illegal parking
and the inability of existing penalties to curb it. The ordinance is designed to improve
traffic conditions in the City of Cebu and thus shows a real and substantial relation to
the welfare, comfort and convenience of the people of Cebu. The only restrictions to
an ordinance passed under the general welfare clause, as declared in Salaveria, is
that the regulation must be reasonable, consonant with the general powers and
purposes of the corporation, consistent with national laws and policies, and not
unreasonable or discriminatory. The measure in question undoubtedly comes within
these parameters.
Upon the denial of their respective motions for reconsideration on August 4, 2003, the
Jabans and Legaspi came to the Court via separate petitions for review on certiorari.
The appeals were consolidated.
Issues
Based on the submissions of the parties, the following issues are decisive of the
challenge, to wit:
1. Whether Ordinance No. 1664 was enacted within the ambit of the legislative
powers of the City of Cebu; and
2. Whether Ordinance No. 1664 complied with the requirements for validity
and constitutionality, particularly the limitations set by the Constitution and
the relevant statutes.
Ruling
The petitions for review have no merit.
A.
Tests for a valid ordinance
In City of Manila v. Laguio, Jr.,18 the Court restates the tests of a valid ordinance
thusly:chanRoblesvirtualLawlibrary
The tests of a valid ordinance are well established. A long line of decisions has held
that for an ordinance to be valid, it must not only be within the corporate powers of the
local government unit to enact and must be passed according to the procedure
prescribed by law, it must also conform to the following substantive requirements: (1)
must not contravene the Constitution or any statute; (2) must not be unfair or
oppressive; (3) must not be partial or discriminatory; (4) must not prohibit but may
regulate trade; (5) must be general and consistent with public policy; and (6) must not
be unreasonable.
As jurisprudence indicates, the tests are divided into the formal (i.e., whether the
ordinance was enacted within the corporate powers of the LGU, and whether it was
passed in accordance with the procedure prescribed by law), and the substantive (i.e.,
involving inherent merit, like the conformity of the ordinance with the limitations under
the Constitution and the statutes, as well as with the requirements of fairness and
reason, and its consistency with public policy).
B.
Compliance of Ordinance No. 1664 with the formal requirements
Was the enactment of Ordinance No. 1664 within the corporate powers of the LGU of
the City of Cebu?
The answer is in the affirmative. Indeed, with no issues being hereby raised against
the formalities attendant to the enactment of Ordinance No. 1664, we presume its full
compliance with the test in that regard. Congress enacted the LGC as the
implementing law for the delegation to the various LGUs of the States great powers,
namely: the police power, the power of eminent domain, and the power of taxation.
The LGC was fashioned to delineate the specific parameters and limitations to be
complied with by each LGU in the exercise of these delegated powers with the view of
making each LGU a fully functioning subdivision of the State subject to the
constitutional and statutory limitations.
In particular, police power is regarded as the most essential, insistent and the least
limitable of powers, extending as it does to all the great public needs.20 It is
unquestionably the power vested in the legislature by the constitution, to make,
ordain and establish all manner of wholesome and reasonable laws, statutes and
ordinances, either with penalties or without, not repugnant to the constitution, as they
shall judge to be for the good and welfare of the commonwealth, and of the subject of
the same.21 According to Cooley: [The police power] embraces the whole system of
internal regulation by which the state seeks not only to preserve the public order and
to prevent offences against itself, but also to establish for the intercourse of citizens
with citizens, those rules of good manners and good neighborhood which are
calculated to prevent the conflict of rights and to insure to each the uninterrupted
enjoyment of his own, so far as it is reasonably consistent with the right enjoyment of
rights by others.22
In point is the exercise by the LGU of the City of Cebu of delegated police power.
In Metropolitan Manila Development Authority v. BelAir Village Association,
Inc.,23 the Court cogently observed:chanRoblesvirtualLawlibrary
It bears stressing that police power is lodged primarily in the National Legislature. It
cannot be exercised by any group or body of individuals not possessing legislative
power. The National Legislature, however, may delegate this power to the
President and administrative boards as well as the lawmaking bodies of
municipal corporations or local government units. Once delegated, the agents
can exercise only such legislative powers as are conferred on them by the
national lawmaking body. (emphasis supplied)chanroblesvirtualawlibrary
The CA opined, and correctly so, that vesting cities like the City of Cebu with the
legislative power to enact traffic rules and regulations was expressly done through
Section 458 of the LGC, and also generally by virtue of the General Welfare Clause
embodied in Section 16 of the LGC.24
Section 458 of the LGC relevantly states:chanRoblesvirtualLawlibrary
Section 458. Powers, Duties, Functions and Composition. (a) The sangguniang
panlungsod, as the legislative body of the city, shall enact ordinances, approve
resolutions and appropriate funds for the general welfare of the city and its inhabitants
pursuant to Section 16 of this Code and in the proper exercise of the corporate powers
of the city as provided for under Section 22 of this Code, and shall:
x x x
(5) Approve ordinances which shall ensure the efficient and effective delivery of
the basic services and facilities as provided for under Section 17 of this Code,
and in addition to said services and facilities, shall:
x x x
(v) Regulate the use of streets, avenues, alleys, sidewalks, bridges, parks and
other public places and approve the construction, improvement repair and
maintenance of the same; establish bus and vehicle stops and terminals or
regulate the use of the same by privatelyowned vehicles which serve the
public; regulate garages and operation of conveyances for hire; designate
stands to be occupied by public vehicles when not in use; regulate the putting
up of signs, signposts, awnings and awning posts on the streets; and provide
for the lighting, cleaning and sprinkling of streets and public places;
(vi) Regulate traffic on all streets and bridges; prohibit encroachments or
obstacles thereon and, when necessary in the interest of public welfare,
authorize the removal of encroachments and illegal constructions in public
places; (emphasis supplied)chanroblesvirtualawlibrary
The foregoing delegation reflected the desire of Congress to leave to the cities
themselves the task of confronting the problem of traffic congestions associated with
development and progress because they were directly familiar with the situations in
their respective jurisdictions. Indeed, the LGUs would be in the best position to craft
their traffic codes because of their familiarity with the conditions peculiar to their
communities. With the broad latitude in this regard allowed to the LGUs of the cities,
their traffic regulations must be held valid and effective unless they infringed the
constitutional limitations and statutory safeguards.
C.
Compliance of Ordinance No. 1664with the substantive requirements
The first substantive requirement for a valid ordinance is the adherence to the
constitutional guaranty of due process of law. The guaranty is embedded in Article III,
Section 1 of the Constitution, which ordains:
Section 1. No person shall be deprived of life, liberty or property without due process
of law, nor shall any person be denied the equal protection of the laws.
The guaranty of due process of law is a constitutional safeguard against any
arbitrariness on the part of the Government, whether committed by the Legislature, the
Executive, or the Judiciary. It is a protection essential to every inhabitant of the
country, for, as a commentator on Constitutional Law has vividly written: 25
x x x. If the law itself unreasonably deprives a person of his life, liberty, or property, he
is denied the protection of due process. If the enjoyment of his rights is conditioned on
an unreasonable requirement, due process is likewise violated. Whatsoever be the
source of such rights, be it the Constitution itself or merely a statute, its unjustified
withholding would also be a violation of due process. Any government act that
militates against the ordinary norms of justice or fair play is considered an infraction of
the great guaranty of due process; and this is true whether the denial involves
violation merely of the procedure prescribed by the law or affects the very validity of
the law itself.
In City of Manila v. Laguio, Jr.,26 the Court expounded on the aspects of the guaranty
of due process of law as a limitation on the acts of
government, viz:chanRoblesvirtualLawlibrary
This clause has been interpreted as imposing two separate limits on government,
usually called procedural due process and substantive due process. review, Ordinance No. 1664 met the substantive tests of validity and constitutionality
Procedural due process, as the phrase implies, refers to the procedures that the
government must follow before it deprives a person of life, liberty, or property. Classic
procedural due process issues are concerned with that kind of notice and what form of
hearing the government must provide when it takes a particular action.
Substantive due process, as that phrase connotes, asks whether the government has
an adequate reason for taking away a persons life, liberty, or property. In other words,
substantive due process looks to whether there is sufficient justification for the
governments action. Case law in the United States (U.S.) tells us that whether there is
such a justification depends very much on the level of scrutiny used. For example, if a
law is in an area where only rational basis review is applied, substantive due process
is met so long as the law is rationally related to a legitimate government purpose. But
if it is an area where strict scrutiny is used, such as for protecting fundamental rights,
then the government will meet substantive due process only if it can prove that the law
is necessary to achieve a compelling government purpose.
The police power granted to local government units must always be exercised with
utmost observance of the rights of the people to due process and equal protection of
the law. Such power cannot be exercised whimsically, arbitrarily or despotically as its
exercise is subject to a qualification, limitation or restriction demanded by the respect
and regard due to the prescription of the fundamental law, particularly those forming
part of the Bill of Rights. Individual rights, it bears emphasis, may be adversely
affected only to the extent that may fairly be required by the legitimate demands of
public interest or public welfare. Due process requires the intrinsic validity of the law in
interfering with the rights of the person to his life, liberty and
property.27ChanRoblesVirtualawlibrary
The Jabans contend that Ordinance No. 1664, by leaving the confiscation and
immobilization of the motor vehicles to the traffic enforcers or the regular personnel of
the Philippine National Police (PNP) instead of to officials exercising judicial authority,
was violative of the constitutional guaranty of due process; that such confiscation and
immobilization should only be after a hearing on the merits by courts of law; and that
the immobilization and the clamping of the cars and motor vehicles by the police or
traffic enforcers could be subject to abuse.
On his part, Legaspi likewise contends that Ordinance No. 1664 violated the
constitutional guaranty of due process for being arbitrary and oppressive; and that its
provisions conferring upon the traffic enforcers the absolute discretion to be the
enforcers, prosecutors, judges and collectors all at the same time were vague and
ambiguous.28 He reminds that the grant of police powers for the general welfare under
the LGC was not unlimited but subject to constitutional limitations; 29 and that these
consolidated cases should not be resolved differently from the resolution of a third
case assailing the validity of Ordinance No. 1664 (Astillero case), in which the
decision of the same RTC declaring Ordinance No. 1664 as unconstitutional had
attained finality following the denial of due course to the appeal of the City of Cebu
and its codefendants.
Judged according to the foregoing enunciation of the guaranty of due process of law,
the contentions of the petitioners cannot be sustained. Even under strict scrutiny
by its conformity with the limitations under the Constitution and the statutes, as well as
with the requirements of fairness and reason, and its consistency with public policy.
To us, the terms encroachment and obstacles used in Section 458 of the LGC, supra,
were broad enough to include illegally parked vehicles or whatever else obstructed the
streets, alleys and sidewalks, which were precisely the subject of Ordinance No. 1664
in avowedly aiming to ensure a smooth flow of vehicular traffic in all the streets in the
City of Cebu at all times (Section 1). This aim was borne out by its Whereas
Clauses, viz:chanRoblesvirtualLawlibrary
WHEREAS, the City of Cebu enacted the Traffic Code (Ordinance No. 801) as
amended, provided for Parking Restrictions and Parking Prohibitions in the streets of
Cebu City;
WHEREAS, despite the restrictions and prohibitions of parking on certain
streets of Cebu City, violations continued unabated due, among others, to the
very low penalties imposed under the Traffic Code of Cebu City;
WHEREAS, City Ordinance 1642 was enacted in order to address the traffic
congestions caused by illegal parkings in the streets of Cebu City;
WHEREAS, there is a need to amend City Ordinance No.1642 in order to fully
address and solve the problem of illegal parking and other violations of the
Traffic Code of Cebu City;30 (emphasis supplied)chanroblesvirtualawlibrary
Considering that traffic congestions were already retarding the growth and progress in
the population and economic centers of the country, the plain objective of Ordinance
No. 1664 was to serve the public interest and advance the general welfare in the City
of Cebu. Its adoption was, therefore, in order to fulfill the compelling government
purpose of immediately addressing the burgeoning traffic congestions caused by
illegally parked vehicles obstructing the streets of the City of Cebu.
Legaspis attack against the provisions of Ordinance No. 1664 for being vague and
ambiguous cannot stand scrutiny. As can be readily seen, its text was forthright and
unambiguous in all respects. There could be no confusion on the meaning and
coverage of the ordinance. But should there be any vagueness and ambiguity in the
provisions, which the OSG does not concede, 31 there was nothing that a proper
application of the basic rules of statutory construction could not justly rectify.
The petitioners further assert that drivers or vehicle owners affected by Ordinance No.
1664 like themselves were not accorded the opportunity to protest the clamping,
towing, and impounding of the vehicles, or even to be heard and to explain their side
prior to the immobilization of their vehicles; and that the ordinance was oppressive and
arbitrary for that reason.
The adverse assertions against Ordinance No. 1664 are unwarranted.
Firstly, Ordinance No. 1664 was far from oppressive and arbitrary. Any driver or
vehicle owner whose vehicle was immobilized by clamping could protest such action
of a traffic enforcer or PNP personnel enforcing the ordinance. Section 3 of Ordinance
No. 1664, supra, textually afforded an administrative escape in the form of permitting
the release of the immobilized vehicle upon a protest directly made to the Chairman of
CITOM; or to the Chairman of the Committee on Police, Fire and Penology of the City
of Cebu; or to Asst. City Prosecutor Felipe Belcia officials named in the ordinance
itself. The release could be ordered by any of such officials even without the payment
of the stipulated fine. That none of the petitioners, albeit lawyers all, resorted to such
recourse did not diminish the fairness and reasonableness of the escape clause
written in the ordinance.
Secondly, the immobilization of a vehicle by clamping pursuant to the ordinance was
not necessary if the driver or vehicle owner was around at the time of the
apprehension for illegal parking or obstruction. In that situation, the enforcer would
simply either require the driver to move the vehicle or issue a traffic citation should the
latter persist in his violation. The clamping would happen only to prevent the
transgressor from using the vehicle itself to escape the due sanctions. And, lastly, the
towing away of the immobilized vehicle was not equivalent to a summary impounding,
but designed to prevent the immobilized vehicle from obstructing traffic in the vicinity
of the apprehension and thereby ensure the smooth flow of traffic. The owner of the
towed vehicle would not be deprived of his property.
In fine, the circumstances set forth herein indicate that Ordinance No. 1664 complied
with the elements of fairness and reasonableness.
Did Ordinance No. 1664 meet the requirements of procedural due process?
Notice and hearing are the essential requirements of procedural due process. Yet,
there are many instances under our laws in which the absence of one or both of such
requirements is not necessarily a denial or deprivation of due process. Among the
instances are the cancellation of the passport of a person being sought for the
commission of a crime, the preventive suspension of a civil servant facing
administrative charges, the distraint of properties to answer for tax delinquencies, the
padlocking of restaurants found to be unsanitary or of theaters showing obscene
movies, and the abatement of nuisance per se.32 Add to them the arrest of a person in
flagrante delicto.33
The clamping of the petitioners vehicles pursuant to Ordinance No. 1664 (and of the
vehicles of others similarly situated) was of the same character as the aforecited
established exceptions dispensing with notice and hearing. As already said, the
immobilization of illegally parked vehicles by clamping the tires was necessary
because the transgressors were not around at the time of apprehension. Under such
circumstance, notice and hearing would be superfluous. Nor should the lack of a trial
type hearing prior to the clamping constitute a breach of procedural due process, for
giving the transgressors the chance to reverse the apprehensions through a timely
protest could equally satisfy the need for a hearing. In other words, the prior
intervention of a court of law was not indispensable to ensure a compliance with the
guaranty of due process.
To reiterate, the clamping of the illegally parked vehicles was a fair and reasonable
way to enforce the ordinance against its transgressors; otherwise, the transgressors
would evade liability by simply driving away.
Finally, Legaspis position, that the final decision of the RTC rendered in the Astillero
case declaring Ordinance No. 1664 unconstitutional bound the City of Cebu, thereby
precluding these consolidated appeals from being decided differently, is utterly
untenable. For one, Legaspi undeservedly extends too much importance to an
irrelevant decision of the RTC irrelevant, because the connection between that case
to these cases was not at all shown. For another, he ignores that it should be the RTC
that had improperly acted for so deciding the Astillero case despite the appeals in
these cases being already pending in the CA. Being the same court in the three
cases, the RTC should have anticipated that in the regular course of proceedings, the
outcome of the appeal in these cases then pending before the CA would ultimately be
elevated to and determined by no less than the Court itself. Such anticipation should
have made it refrain from declaring Ordinance No. 1664 unconstitutional, for a lower
court like itself, appreciating its position in the interrelation and operation of the
integrated judicial system of the nation, should have exercised a becoming modesty
on the issue of the constitutionality of the same ordinance that the Constitution
required the majority vote of the Members of the Court sitting en banc to
determine.34 Such becoming modesty also forewarned that any declaration of
unconstitutionality by an inferior court was binding only on the parties, but that a
declaration of unconstitutionality by the Court would be a precedent binding on all. 35
WHEREFORE, the Court DENIES the petitions for review on certiorari for their lack of
merit;AFFIRMS the decision promulgated on June 16, 2003 by the Court of Appeals;
and ORDERS the petitioners to pay the costs of suit.
SO ORDERED.
FIRST DIVISION
G.R. No. 156052 March 7, 2007
SOCIAL JUSTICE SOCIETY (SJS), VLADIMIR ALARIQUE T. CABIGAO, and
BONIFACIO S. TUMBOKON,Petitioners,
vs.
HON. JOSE L. ATIENZA, JR., in his capacity as Mayor of the City of
Manila, Respondent.
DECISION
CORONA, J.:
In this original petition for mandamus,1 petitioners Social Justice Society (SJS),
Vladimir Alarique T. Cabigao and Bonifacio S. Tumbokon seek to compel respondent
Hon. Jose L. Atienza, Jr., mayor of the City of Manila, to enforce Ordinance No. 8027.
The antecedents are as follows.
On November 20, 2001, the Sangguniang Panlungsod of Manila enacted Ordinance
No. 8027.2 Respondent mayor approved the ordinance on November 28, 2001. 3 It
became effective on December 28, 2001, after its publication. 4
Ordinance No. 8027 was enacted pursuant to the police power delegated to local
government units, a principle described as the power inherent in a government to
enact laws, within constitutional limits, to promote the order, safety, health, morals and
general welfare of the society.5 This is evident from Sections 1 and 3 thereof which
state:
SECTION 1. For the purpose of promoting sound urban planning and ensuring health,
public safety, and general welfare of the residents of Pandacan and Sta. Ana as well
as its adjoining areas, the land use of [those] portions of land bounded by the Pasig
River in the north, PNR Railroad Track in the east, Beata St. in the south, Palumpong
St. in the southwest, and Estero de Pancacan in the west[,] PNR Railroad in the
northwest area, Estero de Pandacan in the [n]ortheast, Pasig River in the southeast
and Dr. M.L. Carreon in the southwest. The area of Punta, Sta. Ana bounded by the
Pasig River, Marcelino Obrero St., Mayo 28 St., and F. Manalo Street, are hereby
reclassified from Industrial II to Commercial I.
xxx xxx xxx
SEC. 3. Owners or operators of industries and other businesses, the operation of
which are no longer permitted under Section 1 hereof, are hereby given a period of six
(6) months from the date of effectivity of this Ordinance within which to cease and
desist from the operation of businesses which are hereby in consequence, disallowed.
Ordinance No. 8027 reclassified the area described therein from industrial to
commercial and directed the owners and operators of businesses disallowed under
Section 1 to cease and desist from operating their businesses within six months from
the date of effectivity of the ordinance. Among the businesses situated in the area are
the so-called "Pandacan Terminals" of the oil companies Caltex (Philippines), Inc.,
Petron Corporation and Pilipinas Shell Petroleum Corporation.
However, on June 26, 2002, the City of Manila and the Department of Energy (DOE)
entered into a memorandum of understanding (MOU)6 with the oil companies in which
they agreed that "the scaling down of the Pandacan Terminals [was] the most viable
and practicable option." Under the MOU, the oil companies agreed to perform the
following:
Section 1. - Consistent with the objectives stated above, the OIL COMPANIES shall,
upon signing of this MOU, undertake a program to scale down the Pandacan
Terminals which shall include, among others, the immediate
removal/decommissioning process of TWENTY EIGHT (28) tanks starting with the
LPG spheres and the commencing of works for the creation of safety buffer and green
zones surrounding the Pandacan Terminals. xxx
Section 2. Consistent with the scale-down program mentioned above, the OIL
COMPANIES shall establish joint operations and management, including the
operation of common, integrated and/or shared facilities, consistent with international
and domestic technical, safety, environmental and economic considerations and
standards. Consequently, the joint operations of the OIL COMPANIES in the
Pandacan Terminals shall be limited to the common and integrated areas/facilities. A
separate agreement covering the commercial and operational terms and conditions of
the joint operations, shall be entered into by the OIL COMPANIES.
Section 3. - The development and maintenance of the safety and green buffer zones
mentioned therein, which shall be taken from the properties of the OIL COMPANIES
and not from the surrounding communities, shall be the sole responsibility of the OIL
COMPANIES.
The City of Manila and the DOE, on the other hand, committed to do the following:
Section 1. - The City Mayor shall endorse to the City Council this MOU for its
appropriate action with the view of implementing the spirit and intent thereof.
Section 2. - The City Mayor and the DOE shall, consistent with the spirit and intent of
this MOU, enable the OIL COMPANIES to continuously operate in compliance with
legal requirements, within the limited area resulting from the joint operations and the
scale down program.
Section 3. - The DOE and the City Mayor shall monitor the OIL COMPANIES
compliance with the provisions of this MOU.
Section 4. - The CITY OF MANILA and the national government shall protect the
safety buffer and green zones and shall exert all efforts at preventing future
occupation or encroachment into these areas by illegal settlers and other unauthorized
parties.
The Sangguniang Panlungsod ratified the MOU in Resolution No. 97.7 In the same
resolution, the Sangguniandeclared that the MOU was effective only for a period of six
months starting July 25, 2002.8 Thereafter, on January 30, 2003,
the Sanggunian adopted Resolution No. 139 extending the validity of Resolution No.
97 to April 30, 2003 and authorizing Mayor Atienza to issue special business permits
to the oil companies. Resolution No. 13, s. 2003 also called for a reassessment of the
ordinance.10
Meanwhile, petitioners filed this original action for mandamus on December 4, 2002
praying that Mayor Atienza be compelled to enforce Ordinance No. 8027 and order
the immediate removal of the terminals of the oil companies.11
The issues raised by petitioners are as follows:
1. whether respondent has the mandatory legal duty to enforce Ordinance
No. 8027 and order the removal of the Pandacan Terminals, and
2. whether the June 26, 2002 MOU and the resolutions ratifying it can
amend or repeal Ordinance No. 8027.12
Petitioners contend that respondent has the mandatory legal duty, under Section 455
(b) (2) of the Local Government Code (RA 7160), 13 to enforce Ordinance No. 8027
and order the removal of the Pandacan Terminals of the oil companies. Instead, he
has allowed them to stay.
Respondents defense is that Ordinance No. 8027 has been superseded by the MOU
and the resolutions.14However, he also confusingly argues that the ordinance and
MOU are not inconsistent with each other and that the latter has not amended the
former. He insists that the ordinance remains valid and in full force and effect and that
the MOU did not in any way prevent him from enforcing and implementing it. He
maintains that the MOU should be considered as a mere guideline for its full
implementation.15
Under Rule 65, Section 316 of the Rules of Court, a petition for mandamus may be
filed when any tribunal, corporation, board, officer or person unlawfully neglects the
performance of an act which the law specifically enjoins as a duty resulting from an
office, trust or station. Mandamus is an extraordinary writ that is employed to compel
the performance, when refused, of a ministerial duty that is already imposed on the
respondent and there is no other plain, speedy and adequate remedy in the ordinary
course of law. The petitioner should have a well-defined, clear and certain legal right
to the performance of the act and it must be the clear and imperative duty of
respondent to do the act required to be done.17
Mandamus will not issue to enforce a right, or to compel compliance with a duty, which
is questionable or over which a substantial doubt exists. The principal function of the
writ of mandamus is to command and to expedite, not to inquire and to adjudicate;
thus, it is neither the office nor the aim of the writ to secure a legal right but to
implement that which is already established. Unless the right to the relief sought is
unclouded, mandamus will not issue.18
To support the assertion that petitioners have a clear legal right to the enforcement of
the ordinance, petitioner SJS states that it is a political party registered with the
Commission on Elections and has its offices in Manila. It claims to have many
members who are residents of Manila. The other petitioners, Cabigao and Tumbokon,
are allegedly residents of Manila.
We need not belabor this point. We have ruled in previous cases that when
a mandamus proceeding concerns a public right and its object is to compel a public
duty, the people who are interested in the execution of the laws are regarded as the
real parties in interest and they need not show any specific interest. 19 Besides, as
residents of Manila, petitioners have a direct interest in the enforcement of the citys
ordinances. Respondent never questioned the right of petitioners to institute this
proceeding.
On the other hand, the Local Government Code imposes upon respondent the duty,
as city mayor, to "enforce all laws and ordinances relative to the governance of the
city.">20 One of these is Ordinance No. 8027. As the chief executive of the city, he has
the duty to enforce Ordinance No. 8027 as long as it has not been repealed by
theSanggunian or annulled by the courts.21 He has no other choice. It is his ministerial
duty to do so. In Dimaporo v. Mitra, Jr.,22 we stated the reason for this:
These officers cannot refuse to perform their duty on the ground of an alleged
invalidity of the statute imposing the duty. The reason for this is obvious. It might
seriously hinder the transaction of public business if these officers were to be
permitted in all cases to question the constitutionality of statutes and ordinances
imposing duties upon them and which have not judicially been declared
unconstitutional. Officers of the government from the highest to the lowest are
creatures of the law and are bound to obey it.23
The question now is whether the MOU entered into by respondent with the oil
companies and the subsequent resolutions passed by the Sanggunian have made the
respondents duty to enforce Ordinance No. 8027 doubtful, unclear or uncertain. This
is also connected to the second issue raised by petitioners, that is, whether the MOU
and Resolution Nos. 97, s. 2002 and 13, s. 2003 of the Sanggunian can amend or
repeal Ordinance No. 8027.
We need not resolve this issue. Assuming that the terms of the MOU were
inconsistent with Ordinance No. 8027, the resolutions which ratified it and made it
binding on the City of Manila expressly gave it full force and effect only until April 30,
2003. Thus, at present, there is nothing that legally hinders respondent from enforcing
Ordinance No. 8027.24
Ordinance No. 8027 was enacted right after the Philippines, along with the rest of the
world, witnessed the horror of the September 11, 2001 attack on the Twin Towers of
the World Trade Center in New York City. The objective of the ordinance is to protect
the residents of Manila from the catastrophic devastation that will surely occur in case
of a terrorist attack on the Pandacan Terminals. No reason exists why such a
protective measure should be delayed.
WHEREFORE, the petition is hereby GRANTED. Respondent Hon. Jose L. Atienza,
Jr., as mayor of the City of Manila, is directed to immediately enforce Ordinance No.
8027.
SO ORDERED.
EN BANC
G.R. No. 187836, November 25, 2014
SOCIAL JUSTICE SOCIETY (SJS) OFFICERS, NAMELY, SAMSON S.
ALCANTARA, AND VLADIMIR ALARIQUE T. CABIGAO, Petitioners, v. ALFREDO
S. LIM, IN HIS CAPACITY AS MAYOR OF THE CITY OF MANILA, Respondent.
G.R. NO. 187916
JOSE L. ATIENZA, JR., BIENVINIDO M. ABANTE, MA. LOURDES M. ISIP-
GARCIA, RAFAEL P. BORROMEO JOCELYN DAWIS-ASUNCION, MINORS
MARIAN REGINA B. TARAN, MACAILA RICCI B. TARAN, RICHARD KENNETH B.
TARAN, REPRESENTED AND JOINED BY THEIR PARENTS RICHARD AND
MARITES TARAN, MINORS CZARINA ALYSANDRA C. RAMOS, CEZARAH Petitioners allege the parties respective capacity to sue and be sued, viz:
ADRIANNA C. RAMOS, AND CRISTEN AIDAN C. RAMOS REPRESENTED AND
JOINED BY THEIR MOTHER DONNA C. RAMOS, MINORS JAZMIN SYLLITA T.
Suing capacity aside from being
VILA AND ANTONIO T. CRUZ IV, REPRESENTED AND JOINED BY THEIR
Petitioners Residence in Manila residents of Manila/other personal
MOTHER MAUREEN C. TOLENTINO, Petitioners,v. MAYOR ALFREDO S. LIM,
circumstances
VICE MAYOR FRANCISCO DOMAGOSO, COUNCILORS ARLENE W. KOA,
MOISES T. LIM, JESUS FAJARDO LOUISITO N. CHUA, VICTORIANO A.
MELENDEZ, JOHN MARVIN C. NIETO, ROLANDO M. VALERIANO, RAYMUNDO G.R. No. 187836
R. YUPANGCO, EDWARD VP MACEDA, RODERICK D. VALBUENA, JOSEFINA
M. SISCAR, SALVADOR PHILLIP H. LACUNA, LUCIANO M. VELOSO, CARLO V. Manila taxpayer;
LOPEZ, ERNESTO F. RIVERA,1 DANILO VICTOR H. LACUNA, JR., ERNESTO G. One of the petitioners in SJS v.
ISIP, HONEY H. LACUNA-PANGAN, ERNESTO M. DIONISO, JR. AND ERICK IAN SJS Officer Samson Not mentioned in the
Atienza(G.R. No. 156052);*
O. NIEVA, Respondents. S. Alcantara petition; holding office
Pesident of ABAKADA GURO PARTY
(Alcantara) in Ermita, Manila
LIST with members who are residents
CHEVRON PHILIPPINES INC., PETRON CORPORATION AND PILIPINAS SHELL of the City of Manila
PETROLEUM CORPORATION, Intervenors.
DECISION SJS Officer Vladimir
One of the petitioners in SJS v.
PEREZ, J.: Alarique T. Cabigao Pandacan
Atienza(G.R. No. 156052)
(Cabigao)
Challenged in these consolidated petitions2 is the validity of Ordinance No.
81873 entitled AN ORDINANCE AMENDING ORDINANCE NO. 8119, OTHERWISE * The allegation is inaccurate. SJS Officer Alcantara is actually one of the counsels for
KNOWN AS THE MANILA COMPREHENSIVE LAND USE PLAN AND ZONING petitioner SJS in G.R. No. 156052. The petitioners in that case are the SJS itself,
ORDINANCE OF 2006, BY CREATING A MEDIUM INDUSTRIAL ZONE (1-2) AND Cabigao and Bonifacio S. Tumbokon (Tumbokon).
HEAVY INDUSTRIAL ZONE (1-3), AND PROVIDING FOR ITS ENFORCEMENT
enacted by the Sangguniang Panlungsod of Manila (Sangguniang Panlungsod) on 14 G.R. No. 187916
May 2009.

The creation of a medium industrial zone (1-2) and heavy industrial zone (1-3) Former Mayor of Manila;
effectively lifted the prohibition against owners and operators of businesses, including
herein intervenors Chevron Philippines, Inc. (Chevron), Pilipinas Shell Petroleum Secretary of Department of
Corporation (Shell), and Petron Corporation (Petron), collectively referred to as the oil Former Mayor Jose L. Atienza, Jr. (Mayor San Environment and Natural
companies, from operating in the designated commercial zone an industrial zone Atienza) Andres Resources (DENR)
prior to the enactment of Ordinance No. 80274 entitled AN ORDINANCE
RECLASSIFYING THE LAND USE OF THAT PORTION OF LAND BOUNDED BY Citizen and taxpayer;member
THE PASIG RIVER IN THE NORTH, PNR RAILROAD TRACK IN THE EAST, BEATA Sta. of the House of
ST. IN THE SOUTH, PALUMPONG ST. IN THE SOUTHWEST AND ESTERO DE Bienvinido M. Abante Ana Representatives
PANDACAN IN THE WEST, PNR RAILROAD IN THE NORTHWEST AREA,
ESTERO DE PANDACAN IN THE NORTHEAST, PASIG RIVER IN THE
SOUTHEAST AND DR. M. L. CARREON IN THE SOUTHWEST, THE AREA OF San Incumbent City Councilor of
PUNTA, STA. ANA BOUNDED BY THE PASIG RIVER, MARCELINO OBRERO ST., Ma. Lourdes M. Isip-Garcia Miguel the City of Manila
MAYO 28 ST. AND THE F. MANALO STREET FROM INDUSTRIAL II TO
COMMERCIAL I, and Ordinance No. 81195 entitled AN ORDINANCE ADOPTING Incumbent City Councilor of
THE MANILA COMPREHENSIVE LAND USE PLAN AND ZONING REGULATIONS Rafael P. Borromeo Paco the City of Manila
OF 2006 AND PROVIDING FOR THE ADMINISTRATION, ENFORCEMENT AND
AMENDMENT THERETO.ChanRoblesVirtualawlibrary
Sta. Incumbent City Councilor of
The Parties Jocelyn Dawis-Asuncion Mesa the City of Manila

Minors Marian Regina B. Taran, Macalia Ricci
B. Taran, Richard Kenneth B. Taran,
represented and joined by their parents Richard
and Marites Taran
Minors Czarina Alysandra C. Ramos, Cezarah
Adrianna C. Ramos, and Cristen Aidan C.
Ramos represented and joined by their mother
Donna c. Ramos
Citizens, real estate owners
Paco and taxpayers
Citizens, real estate owners
Tondo and taxpayers
Raymondo R. Yupangco, Edward VP Ordinance No. 8187
Maceda, Roderick D. Valbuena, Josefina
M. Siscar, Phillip H. Lacuna, Luciano M.
Veloso, Carlo V. Lopez, Ernesto F.
Rivera,6 Danilo Victor H. Lacuna, Jr.,
Ernesto G. Isip, Honey H. Lacuna-Pangan,
Ernesto M. Dionisio, Jr., Erick Ian O. Nieva
The following intervenors, all of which are corporations organized under Philippine
laws, intervened:7

Minors Jasmin Syllita T. Vila and Antonio T. Intervenors Nature of Business

Cruz IV, represented and joined by their mother Sta. Citizens, real estate owners
Maureen C. Tolentino Ana and taxpayers

Respondents Sued in their capacity as Chevron Philippines, Inc. importing, distributing and marketing of petroleum products
(CHEVRON) in the Philippines since 1922

Pilipinas Shell Petroleum manufacturing, refining, importing, distributing and

Corporation (SHELL) marketing of petroleum products in the Philippines
G.R. Nos. 187836 and 187916

Petron Corporation manufacturing, refining, importing, distributing and

(PETRON) marketing of petroleum products in the Philippines

Incumbent Mayor of Manila at the time of

Former Mayor Alfredo S. Lim (Mayor Lim) They claim that their rights with respect to the oil depots in Pandacan would be directly
the filing of the present petitions
affected by the outcome of these cases.chanrobleslaw

Respondents Sued in their capacity as The Antecedents

These petitions are a sequel to the case of Social Justice Society v. Mayor Atienza,
Jr.8 (hereinafter referred to as G.R. No. 156052), where the Court found: (1) that the
ordinance subject thereof Ordinance No. 8027 was enacted to safeguard the
G.R. No. 187916 rights to life, security and safety of the inhabitants of Manila;9 (2) that it had passed
the tests of a valid ordinance; and (3) that it is not superseded by Ordinance No.
8119.10 Declaring that it is constitutional and valid,11 the Court accordingly ordered its
immediate enforcement with a specific directive on the relocation and transfer of the
Pandacan oil terminals.12chanrobleslaw
Vice-Mayor Francisco Domagoso (Vice- Vice-Mayor and Presiding Officer of the
Mayor Domagoso) City Council of Manila
Highlighting that the Court has so ruled that the Pandacan oil depots should leave,
herein petitioners now seek the nullification of Ordinance No. 8187, which contains
Principal author of City Ordinance No. provisions contrary to those embodied in Ordinance No. 8027. Allegations of violation
Arlene Woo Koa
8187 of the right to health and the right to a healthful and balanced environment are also
included.
Moises T. Lim, Jesus Fajardo, Louisito N.
Personal and official capacities as For a better perspective of the facts of these cases, we again trace the history of the
Chua, Victoriano A. Melendez, John
councilors who voted and approved City Pandacan oil terminals, as well as the intervening events prior to the reclassification of
Marvin Nieto, Rolando M. Valeriano,
the land use from Industrial II to Commercial I under Ordinance No. 8027 until the
creation of Medium Industrial Zone and Heavy Industrial Zone pursuant to Ordinance consumption and 35% nationwide. Fuel can also be transported through barges along
No. 8187. the Pasig [R]iver or tank trucks via the South Luzon Expressway.13 (Citations omitted)

History of the Pandacan Memorandum of Agreement (MOA)

Oil Terminals dated 12 October 2001 between the oil companies
and the Department of Energy (DOE)
We quote the following from the Resolution of the Court in G.R. No. 156052:
On 12 October 2001, the oil companies and the DOE entered into a MOA 14 in light of
Pandacan (one of the districts of the City of Manila) is situated along the banks of the recent international developments involving acts of terrorism on civilian and
Pasig [R]iver. At the turn of the twentieth century, Pandacan was unofficially government landmarks,15potential new security risks relating to the Pandacan oil
designated as the industrial center of Manila. The area, then largely uninhabited, was terminals and the impact on the surrounding community which may be affected,16 and
ideal for various emerging industries as the nearby river facilitated the transportation to address the perceived risks posed by the proximity of communities, businesses
of goods and products. In the 1920s, it was classified as an industrial zone. Among its and offices to the Pandacan oil terminals, consistent with the principle of sustainable
early industrial settlers were the oil companies. x x x development.17 The stakeholders acknowledged that there is a need for a
comprehensive study to address the economic, social, environmental and security
On December 8, 1941, the Second World War reached the shores of the Philippine concerns with the end in view of formulating a Master Plan to address and minimize
Islands. x x x [I]n their zealous attempt to fend off the Japanese Imperial Army, the the potential risks and hazards posed by the proximity of communities, businesses
United States Army took control of the Pandacan Terminals and hastily made plans to and offices to the Pandacan oil terminals without adversely affecting the security and
destroy the storage facilities to deprive the advancing Japanese Army of a valuable reliability of supply and distribution of petroleum products to Metro Manila and the rest
logistics weapon. The U.S. Army burned unused petroleum, causing a frightening of Luzon, and the interests of consumers and users of such petroleum products in
conflagration. Historian Nick Joaquin recounted the events as follows: those areas.18chanrobleslaw
After the USAFFE evacuated the City late in December 1941, all army fuel storage The enactment of Ordinance No. 8027
dumps were set on fire. The flames spread, enveloping the City in smoke, setting even against the continued stay of the oil depots
the rivers ablaze, endangering bridges and all riverside buildings. For one week
longer, the open city blazeda cloud of smoke by day, a pillar of fire by night.
The fire consequently destroyed the Pandacan Terminals and rendered its network of The MOA, however, was short-lived.
depots and service stations inoperative.
On 20 November 2001, during the incumbency of former Mayor Jose L. Atienza, Jr.
After the war, the oil depots were reconstructed. Pandacan changed as Manila rebuilt (Mayor Atienza) now one of the petitioners in G.R. No. 187916 the Sangguniang
itself. The three major oil companies resumed the operation of their depots. But the Panlungsod enacted Ordinance No. 802719 reclassifying the use of the land in
district was no longer a sparsely populated industrial zone; it had evolved into a Pandacan, Sta. Ana, and its adjoining areas from Industrial II to Commercial I.
bustling, hodgepodge community. Today, Pandacan has become a densely populated
area inhabited by about 84,000 people, majority of whom are urban poor who call it The owners and operators of the businesses thus affected by the reclassification were
home. Aside from numerous industrial installations, there are also small businesses, given six months from the date of effectivity of the Ordinance within which to stop the
churches, restaurants, schools, daycare centers and residences situated there. operation of their businesses.
Malacaang Palace, the official residence of the President of the Philippines and the
seat of governmental power, is just two kilometers away. There is a private school Nevertheless, the oil companies were granted an extension of until 30 April 2003
near the Petron depot. Along the walls of the Shell facility are shanties of informal within which to comply with the Ordinance pursuant to the
settlers. More than 15,000 students are enrolled in elementary and high schools following:chanroblesvirtuallawlibrary
situated near these facilities. A university with a student population of about 25,000 is
located directly across the depot on the banks of the Pasig [R]iver. (1) Memorandum of Understanding (MOU)20 dated 26 June 2002 between the City of
Manila and the Department of Energy (DOE), on the one hand, and the oil companies,
The 36-hectare Pandacan Terminals house the oil companies distribution terminals on the other, where the parties agreed that the scaling down of the Pandacan
and depot facilities. The refineries of Chevron and Shell in Tabangao and Bauan, both Terminals [was] the most viable and practicable option21 and committed to adopt
in Batangas, respectively, are connected to the Pandacan Terminals through a 114- specific measures22 consistent with the said objective;
kilometer underground pipeline system. Petrons refinery in Limay, Bataan, on the
other hand, also services the depot. The terminals store fuel and other petroleum (2) Resolution No. 97 dated 25 July 200223 of the Sangguniang Panlungsod, which
products and supply 95% of the fuel requirements of Metro Manila, 50% of Luzons ratified the 26 June 2002 MOU but limited the extension of the period within which to
comply to six months from 25 July 2002; and
(3) Resolution No. 13 dated 30 January 200324 of the Sanguniang Panlungsod, which (b) Article V, Sec. 2331 designating the Pandacan oil depot area as a Planned Unit
extended the validity of Resolution No. 97 to 30 April 2003, authorized then Mayor Development/Overlay Zone (O-PUD); and
Atienza to issue special business permits to the oil companies, and called for a
reassessment of the ordinance. (c) the repealing clause, which reads:

Social Justice Society v. Atienza (G.R. No. 156052): SEC. 84. Repealing Clause. All ordinances, rules, regulations in conflict with the
The filing of an action for mandamus provisions of this Ordinance are hereby repealed; PROVIDED, That the rights that are
before the Supreme Court vested upon the effectivity of this Ordinance shall not be impaired.32
to enforce Ordinance No. 8027 7 March 2007 Decision in G.R. No. 156052;
The mayor has the mandatory legal duty
In the interim, an original action for mandamus entitled Social Justice Society v. to enforce Ordinance No. 8027 and order
Atienza, Jr. docketed as G.R. No. 15605225 was filed on 4 December 2002 by the removal of the Pandacan terminals
Tumbokon and herein petitioners SJS and Cabigao against then Mayor Atienza. The
petitioners sought to compel former Mayor Atienza to enforce Ordinance No. 8027 and On 7 March 2007, the Court granted the petition for mandamus, and directed then
cause the immediate removal of the terminals of the oil companies. 26chanrobleslaw respondent Mayor Atienza to immediately enforce Ordinance No.
8027.33chanrobleslaw
Issuance by the Regional Trial Court (RTC)
of writs of preliminary prohibitory injunction Confined to the resolution of the following issues raised by the petitioners, to wit:
and preliminary mandatory injunction,
and status quo order in favor of the oil companies 1. whether respondent [Mayor Atienza] has the mandatory legal duty to enforce
Ordinance No. 8027 and order the removal of the Pandacan Terminals, and
Unknown to the Court, during the pendency of G.R. No. 156052, and before the
expiration of the validity of Resolution No. 13, the oil companies filed the following 2. whether the June 26, 2002 MOU and the resolutions ratifying it can amend or
actions before the Regional Trial Court of Manila: (1) an action for the annulment of repeal Ordinance No. 8027.34
Ordinance No. 8027 with application for writs of preliminary prohibitory injunction and
preliminary mandatory injunction by Chevron; (2) a petition for prohibition the Court declared:
and mandamus also for the annulment of the Ordinance with application for writs of x x x [T]he Local Government Code imposes upon respondent the duty, as city mayor,
preliminary prohibitory injunction and preliminary mandatory injunction by Shell; and to enforce all laws and ordinances relative to the governance of the city. One of
(3) a petition assailing the validity of the Ordinance with prayer for the issuance of a these is Ordinance No. 8027. As the chief executive of the city, he has the duty to
writ of preliminary injunction and/or temporary restraining order (TRO) by enforce Ordinance No. 8027 as long as it has not been repealed by the Sanggunian or
Petron.27chanrobleslaw annulled by the courts. He has no other choice. It is his ministerial duty to do so. x x x
Writs of preliminary prohibitory injunction and preliminary mandatory injunction were x x x x
issued in favor of Chevron and Shell on 19 May 2003. Petron, on the other hand,
obtained a status quo order on 4 August 2004. 28chanrobleslaw The question now is whether the MOU entered into by respondent with the oil
companies and the subsequent resolutions passed by the Sanggunian have made the
The Enactment of Ordinance No. 8119 respondents duty to enforce Ordinance No. 8027 doubtful, unclear or uncertain. x x x
defining the Manila land use plan
and zoning regulations We need not resolve this issue. Assuming that the terms of the MOU were
inconsistent with Ordinance No. 8027, the resolutions which ratified it and made it
On 16 June 2006, then Mayor Atienza approved Ordinance No. 8119 entitled An binding on the City of Manila expressly gave it full force and effect only until April 30,
Ordinance Adopting the Manila Comprehensive Land Use Plan and Zoning 2003. Thus, at present, there is nothing that legally hinders respondent from enforcing
Regulations of 2006 and Providing for the Administration, Enforcement and Ordinance No. 8027.
Amendment thereto.29chanrobleslaw
Ordinance No. 8027 was enacted right after the Philippines, along with the rest of the
Pertinent provisions relative to these cases are the world, witnessed the horror of the September 11, 2001 attack on the Twin Towers of
following:chanroblesvirtuallawlibrary the World Trade Center in New York City. The objective of the ordinance is to
protect the residents of Manila from the catastrophic devastation that will surely
(a) Article IV, Sec. 730 enumerating the existing zones or districts in the City of Manila; occur in case of a terrorist attack on the Pandacan Terminals. No reason exists
why such a protective measure should be delayed.35 (Emphasis supplied; citations record of the discussions in the Sanggunian) actually indicated the clear intent to
omitted) preserve the provisions of Ordinance No. 8027.38
13 February 2008 Resolution in G.R. No. 156052; Filing of a draft Resolution amending
Ordinance No. 8027 is constitutional Ordinance No. 8027 effectively allowing
the oil depots to stay in the Pandacan area;
The oil companies and the Republic of the Philippines, represented by the DOE, filed Manifestation and Motion to forestall
their motions for leave to intervene and for reconsideration of the 7 March 2007 the passing of the new Ordinance
Decision. During the oral arguments, the parties submitted to the power of the Court to filed in G.R. No. 156052
rule on the constitutionality and validity of the assailed Ordinance despite the
pendency of the cases in the RTC.36chanrobleslaw On 5 March 2009, respondent then Councilor Arlene W. Koa, filed with
the Sangguniang Panlungsod a draft resolution entitled An Ordinance Amending
On 13 February 2008, the Court granted the motions for leave to intervene of the oil Ordinance No. 8119 Otherwise Known as The Manila Comprehensive Land Use Plan
companies and the Republic of the Philippines but denied their respective motions for and Zoning Ordinance of 2006 by Creating a Medium Industrial Zone (1-2) and Heavy
reconsideration. The dispositive portion of the Resolution reads: Industrial Zone (1-3) and Providing for its Enforcement.39 Initially numbered as Draft
Ordinance No. 7177, this was later renumbered as Ordinance No. 8187, the assailed
WHEREFORE, x x x Ordinance in these instant petitions.
We reiterate our order to respondent Mayor of the City of Manila to enforce Ordinance Considering that the provisions thereof run contrary to Ordinance No. 8027, the
No. 8027. In coordination with the appropriate agencies and other parties involved, petitioners in G.R. No. 156052 filed a Manifestation and Motion to: a) Stop the City
respondent Mayor is hereby ordered to oversee the relocation and transfer of the Council of Manila from further hearing the amending ordinance to Ordinance No.
Pandacan Terminals out of its present site.37 8027; [and] b) Transfer the monitoring of the enforcement of the Resolution of the
13 February 2008 Resolution in G.R. No. 156052; Honorable Court on this case dated 13 February 2008 from Branch 39, Manila
Ordinance No. 8027 was not impliedly repealed Regional Trial Court to the Supreme Court.40chanrobleslaw
by Ordinance No. 8119
28 April 2009 Resolution in G.R. No. 156052;
The Court also ruled that Ordinance No. 8027 was not impliedly repealed by Second Motion for Reconsideration
Ordinance No. 8119. On this score, the Court ratiocinated: denied with finality; succeeding motions
likewise denied or otherwise noted
For the first kind of implied repeal, there must be an irreconcilable conflict between the without action
two ordinances. There is no conflict between the two ordinances. Ordinance No. 8027
reclassified the Pandacan area from Industrial II to Commercial I. Ordinance No. 8119, On 28 April 2009, pending the resolution of the Manifestation and Motion, the Court
Section 23, designated it as a Planned Unit Development/Overlay Zone (O-PUD). In denied with finality the second motion for reconsideration dated 27 February 2008 of
its Annex C which defined the zone boundaries, the Pandacan area was shown to be the oil companies.41 It further ruled that no further pleadings shall be entertained in the
within the High Density Residential/Mixed Use Zone (R-3/MXD). x x x [B]oth case.42chanrobleslaw
ordinances actually have a common objective, i.e., to shift the zoning classification
from industrial to commercial (Ordinance No. 8027) or mixed residential commercial Succeeding motions were thus denied and/or noted without action. And, after the
(Ordinance No. 8119) Very Urgent Motion to Stop the Mayor of the City of Manila from Signing Draft
Ordinance No. 7177 and to Cite Him for Contempt if He Would Do So filed on 19 May
x x x x 2009 was denied on 2 June 2009 for being moot,43 all pleadings pertaining to the
earlier motion against the drafting of an ordinance to amend Ordinance No. 8027 were
Ordinance No. 8027 is a special law since it deals specifically with a certain area noted without action.44chanrobleslaw
described therein (the Pandacan oil depot area) whereas Ordinance No. 8119 can be
considered a general law as it covers the entire city of Manila.cralawred The Enactment of Ordinance No. 8187
allowing the continued stay of the oil depots
x x x x
On 14 May 2009, during the incumbency of former Mayor Alfredo S. Lim (Mayor Lim),
x x x The repealing clause of Ordinance No. 8119 cannot be taken to indicate the who succeeded Mayor Atienza, the Sangguniang Panlungsod enacted Ordinance No.
legislative intent to repeal all prior inconsistent laws on the subject matter, including 8187.45chanrobleslaw
Ordinance No. 8027, a special enactment, since the aforequoted minutes (an official
The new Ordinance repealed, amended, rescinded or otherwise modified Ordinance
No. 8027, Section 23 of Ordinance No. 8119, and all other Ordinances or provisions
inconsistent therewith46 thereby allowing, once again, the operation of Pollutive/Non- Petitioners pray that Ordinance No. 8187 of the City of Manila be declared null and
Hazardous and Pollutive/Hazardous manufacturing and processing establishments void, and that respondent, and all persons acting under him, be prohibited from
and Highly Pollutive/Non-Hazardous[,] Pollutive/Hazardous[,] Highly enforcing the same.
Pollutive/Extremely Hazardous[,] Non-Pollutive/Extremely Hazardous; and
Pollutive/Extremely Hazardous; and Pollutive/Extremely Hazardous manufacturing G.R. No. 187916
and processing establishments within the newly created Medium Industrial Zone (1-2)
and Heavy Industrial Zone (1-3) in the Pandacan area. The petition for Prohibition, Mandamus and Certiorari with Prayer for Temporary
Restraining Order and/or Injunction against the enforcement of Ordinance No. 8187 of
Thus, where the Industrial Zone under Ordinance No. 8119 was limited to Light former Secretary of Department of Environment and Natural Resources and then
Industrial Zone (I-1), Ordinance No. 8187 appended to the list a Medium Industrial Mayor Atienza, together with other residents and taxpayers of the City of Manila, also
Zone (I-2) and a Heavy Industrial Zone (I-3), where petroleum refineries and oil depots alleges violation of the right to health of the people and the right to a healthful and
are now among those expressly allowed. balanced environment under Sections 15 and 16 of the Constitution.

Hence these petitions.chanrobleslaw Petitioners likewise claim that the Ordinance is in violation of the following health and
environment-related municipal laws, and international conventions and treaties to
The Petitions which the Philippines is a state party:chanroblesvirtuallawlibrary

G.R. No. 187836 1. Municipal Laws

(a) Sections 4,52 12,53 1954 and 3055 of Republic Act No. 8749 otherwise known as the
To support their petition for prohibition against the enforcement of Ordinance No. Philippine Clean Air Act;
8187, the petitioner Social Justice Society (SJS) officers allege
that:chanroblesvirtuallawlibrary (b) Environment Code (Presidential Decree No. 1152);
1. The enactment of the assailed Ordinance is not a valid exercise of police power (c) Toxic and Hazardous Wastes Law (Republic Act No. 6969); and
because the measures provided therein do not promote the general welfare of the
people within the contemplation of the following provisions of law: (d) Civil Code provisions on nuisance and human relations;
47
a) Article III, Section 18 (kk) of Republic Act No. 409 otherwise known as the
Revised Charter of the City of Manila, which provides that the Municipal Board 2. International Conventions and Treaties to which the Philippines is a state party
shall have the legislative power to enact all ordinances it may deem necessary a. Section 1 of the Universal Declaration of Human Rights, which states that
and proper; [e]veryone has the right to life, liberty and security of person;

b) Section 1648 of Republic Act No. 7160 known as the Local Government Code, b. Articles 6,56 2457 and 2758 of the Convention on the Rights of the Child, summarized
which defines the scope of the general welfare clause; by the petitioners in the following manner:
1. the human right to safe and healthy environment[;]
2. The conditions at the time the Court declared Ordinance No. 8027 constitutional in
G.R. No. 156052 exist to this date; 2. human right to the highest attainable standard of health[;]
3. Despite the finality of the Decision in G.R. No. 156052, and notwithstanding that the 3. the human right to ecologically sustainable development[;]
conditions and circumstances warranting the validity of the Ordinance remain the
same, the Manila City Council passed a contrary Ordinance, thereby refusing to 4. the human right to an adequate standard of living, including access to safe food and
recognize that judicial decisions applying or interpreting the laws or the Constitution water[;]
form part of the legal system of the Philippines;49 and
5. the human right of the child to live in an environment appropriate for physical and
4. Ordinance No. 8187 is violative of Sections 15 and 16, Article II of the Constitution mental development[; and]
of the Philippines on the duty of the State to protect and promote the right to health of
the people50 and protect and advance the right of the people to a balanced and 6. the human right to full and equal participation for all persons in environmental
healthful ecology.51chanrobleslaw
decision-making and development planning, and in shaping decisions and policies
affecting ones community, at the local, national and international levels. 59 Respondent former Mayor Lim
Petitioners likewise posit that the title of Ordinance No. 8187 purports to amend or 61
In his Memorandum, former Mayor Lim, through the City Legal Officer, attacks the
repeal Ordinance No. 8119 when it actually intends to repeal Ordinance No. 8027. petitioners lack of legal standing to sue. He likewise points out that the petitioners
According to them, Ordinance No. 8027 was never mentioned in the title and the body failed to observe the principle of hierarchy of courts.
of the new ordinance in violation of Section 26, Article VI of the 1987 Constitution,
which provides that every bill passed by Congress shall embrace only one subject Maintaining that Ordinance No. 8187 is valid and constitutional, he expounds on the
which shall be expressed in the title thereof. following arguments:chanroblesvirtuallawlibrary
Also pointed out by the petitioners is a specific procedure outlined in Ordinance No. On the procedural issues, he contends that: (1) it is the function of the Sangguniang
8119 that should be observed when amending the zoning ordinance. This is provided Panlungsod to enact zoning ordinances, for which reason, it may proceed to amend or
for under Section 81 thereof, which reads: repeal Ordinance No. 8119 without prior referral to the Manila Zoning Board of
SEC. 81. Amendments to the Zoning Ordinance. The proposed amendments to the Adjustment and Appeals (MZBAA) as prescribed under Section 80 (Procedure for Re-
Zoning Ordinance as reviewed and evaluated by the City Planning and Development Zoning) and the City Planning and Development Office (CPDO) pursuant to Section
Office (CPDO) shall be submitted to the City Council for approval of the majority of 81 (Amendments to the Zoning Ordinance) of Ordinance No. 8119, especially when
theSangguniang Panlungsod members. The amendments shall be acceptable and the action actually originated from the Sangguniang Panlungsod itself; (2)
eventually approved: PROVIDED, That there is sufficient evidence and justification for the Sangguniang Panlungsod may, in the later ordinance, expressly repeal all or part
such proposal; PROVIDED FURTHER, That such proposal is consistent with the of the zoning ordinance sought to be modified; and (3) the provision repealing Section
development goals, planning objectives, and strategies of the Manila Comprehensive 23 of Ordinance No. 8119 is not violative of Section 26, Article VI of the 1987
Land Use Plan. Said amendments shall take effect immediately upon approval or after Constitution, which requires that every bill must embrace only one subject and that
thirty (30) days from application. such shall be expressed in the title.

Petitioners thus pray that: On the substantive issues, he posits that the petitions are based on unfounded fears;
that the assailed ordinance is a valid exercise of police power; that it is consistent with
1. upon filing of [the] petition, [the] case be referred to the Court [E]n Banc, and setting the general welfare clause and public policy, and is not unreasonable; that it does not
(sic) the case for oral argument; run contrary to the Constitution, municipal laws, and international conventions; and
that the petitioners failed to overcome the presumption of validity of the assailed
2. upon the filing of [the] petition, a temporary restraining order be issued enjoining the ordinance.
respondents from publishing and posting Manila City Ordinance No. 8187 and/or
posting of Manila City Ordinance No. 8187; and/or taking any steps to implementing Respondents Vice-Mayor Domagoso
(sic) and/or enforce the same and after due hearing, the temporary restraining order and the City Councilors who voted
be converted to a permanent injunction; in favor of the assailed ordinance
3. x x x Manila City Ordinance 8187 [be declared] as null and void for being repugnant On 14 September 2012, after the Court gave the respondents several chances to
to the Constitution and existing municipal laws and international covenants; submit their Memorandum,62 they, through the Secretary of the Sangguniang
Panlungsod, prayed that the Court dispense with the filing thereof.
4. x x x the respondents [be ordered] to refrain from enforcing and/or implementing
Manila City Ordinance No. 8187; In their Comment,63 however, respondents offered a position essentially similar to
those proffered by former Mayor Lim.chanrobleslaw
5. x x x respondent City Mayor Alfredo S. Lim [be enjoined] from issuing any permits
(business or otherwise) to all industries whose allowable uses are anchored under the The Intervenors Position
provisions of Manila Ordinance No. 8187; and on the Consolidated Petitions

6. x x x respondent Mayor of Manila Alfredo S. Lim [be ordered] to comply with the
Order of the Honorable Court in G.R. 156052 dated February 13, 2008.60 On the other hand, the oil companies sought the outright dismissal of the petitions
based on alleged procedural infirmities, among others, incomplete requisites of judicial
The Respondents Position review, violation of the principle of hierarchy of courts, improper remedy, submission
on the Consolidated Petitions of a defective verification and certification against forum shopping, and forum
shopping.
As to the substantive issues, they maintain, among others, that the assailed ordinance
is constitutional and valid; that the Sangguniang Panlalawigan is in the best position to
determine the needs of its constituents; that it is a valid exercise of legislative power;
that it does not violate health and environment-related provisions of the Constitution,
laws, and international conventions and treaties to which the Philippines is a party;
that the oil depots are not likely targets of terrorists; that the scaling down of the
operations in Pandacan pursuant to the MOU has been followed; and that the people
are safe in view of the safety measures installed in the Pandacan terminals.
Incidentally, in its Manifestation dated 30 November 2010,64 Petron informed the Court
that it will cease [the] operation of its petroleum product storage facilities65 in the
Pandacan oil terminal not later than January 2016 on account of the following:
2.01 Environmental issues, many of which are unfounded, continually crop up and
tarnish the Companys image.
2.02. The location of its Pandacan terminal is continually threatened, and made
uncertain preventing long-term planning, by the changing local government
composition. Indeed, the relevant zoning ordinances have been amended three (3)
times, and their validity subjected to litigation.66
Intervening Events
On 28 August 2012, while the Court was awaiting the submission of the Memorandum
of respondents Vice-Mayor Domagoso and the councilors who voted in favor of the
assailed Ordinance, theSangguniang Panlungsod, which composition had already
substantially changed, enacted Ordinance No. 828367 entitled AN ORDINANCE
AMENDING SECTION 2 OF ORDINANCE NO. 8187 BY RECLASSIFYING THE
AREA WHERE PETROLEUM REFINERIES AND OIL DEPOTS ARE LOCATED
FROM HEAVY INDUSTRIAL (1-3) TO HIGH INTENSITY COMMERCIAL/MIXED USE
ZONE (C3/MXD).
The new ordinance essentially amended the assailed ordinance to exclude the area
where petroleum refineries and oil depots are located from the Industrial Zone.
Ordinance No. 8283 thus permits the operation of the industries operating within the
Industrial Zone. However, the oil companies, whose oil depots are located in the High
Intensity Commercial/Mixed Use Zone (C3/MXD), are given until the end of January
2016 within which to relocate their terminals.
Former Mayor Lim, who was then the incumbent mayor, did not support the
amendment. Maintaining that the removal of the oil depots was prejudicial to public
welfare, and, on account of the pending cases in the Supreme Court, he vetoed
Ordinance No. 8283 on 11 September 2012.68chanrobleslaw
On 28 November 2012, former Mayor Lim filed a Manifestation informing this Court
that theSangguniang Panlungsod voted to override the veto, and that he, in turn,
returned it again with his veto. He likewise directed the Sangguniang Panlungsod to
append his written reasons for his veto of the Ordinance, so that the same will be
forwarded to the President for his consideration in the event that his veto is overridden
again.69chanrobleslaw
On 11 December 2012, Shell also filed a similar Manifestation. 70chanrobleslaw
Meanwhile, three days after former Mayor Lim vetoed the new ordinance, Atty. Luch
R. Gempis, Jr. (Atty. Gempis), Secretary of the Sangguniang Panlungsod, writing on
behalf of respondents Vice-Mayor Domagoso and the City Councilors of Manila who
voted in favor of the assailed Ordinance, finally complied with this Courts Resolution
dated 17 July 2012 reiterating its earlier directives 71 to submit the said respondents
Memorandum.
In his Compliance/Explanation with Urgent Manifestation72 dated 13 September 2012,
Atty. Gempis explained that it was not his intention to show disrespect to this Court or
to delay or prejudice the disposition of the cases.
According to him, he signed the Comment prepared by respondents Vice-Mayor and
the City Councilors only to attest that the pleading was personally signed by the
respondents. He clarified that he was not designated as the legal counsel of the
respondents as, in fact, he was of the impression that, pursuant to Section 481(b)(3)
of the Local Government Code,73 it is the City Legal Officer who is authorized to
represent the local government unit or any official thereof in a litigation. It was for the
same reason that he thought that the filing of a Memorandum may already be
dispensed with when the City Legal Officer filed its own on 8 February 2010. He
further explained that the Ordinance subject of these cases was passed during the
7th Council (2007-2010); that the composition of the 8th Council (2010-2013) had
already changed after the 2010 elections; and that steps were already taken to amend
the ordinance again. Hence, he was in a dilemma as to the position of
theSangguniang Panlungsod at the time he received the Courts Resolution of 31 May
2011.
Atty. Gempis, thus, prayed that the Court dispense with the filing of the required
memorandum in view of the passing of Ordinance No. 8283.chanrobleslaw
Issue
The petitioners arguments are primarily anchored on the ruling of the Court in G. R.
No. 156052 declaring Ordinance No. 8027 constitutional and valid after finding that the
presence of the oil terminals in Pandacan is a threat to the life and security of the
people of Manila. From thence, the petitioners enumerated constitutional provisions,
municipal laws and international treaties and conventions on health and environment
protection allegedly violated by the enactment of the assailed Ordinance to support
their position.
The resolution of the present controversy is, thus, confined to the determination of
whether or not the enactment of the assailed Ordinance allowing the continued stay of
the oil companies in the depots is, indeed, invalid and unconstitutional.chanrobleslaw
Our Ruling
We see no reason why Ordinance No. 8187 should not be stricken down insofar as
the presence of the oil depots in Pandacan is concerned.chanrobleslaw
I intricacies of the circumstances herein prevailing.

The scope of the Rules of Procedure for Environmental Cases is embodied in Sec. 2,
We first rule on the procedural issues raised by the respondents and the oil Part I, Rule I thereof. It states that the Rules shall govern the procedure in civil,
companies. criminal and special civil actions before the Metropolitan Trial Courts, Municipal Trial
Courts in Cities, Municipal Trial Courts and Municipal Circuit Trial Courts, and the
At the outset, let it be emphasized that the Court, in G.R. No. 156052, has already Regional Trial Courts involving enforcement or violations of environmental and other
pronounced that the matter of whether or not the oil depots should remain in the related laws, rules and regulations such as but not limited to the following:
Pandacan area is of transcendental importance to the residents of
Manila.74chanrobleslaw (k) R.A. No. 6969, Toxic Substances and Hazardous Waste Act;

We may, thus, brush aside procedural infirmities, if any, as we had in the past, and x x x x
take cognizance of the cases75 if only to determine if the acts complained of are no
longer within the bounds of the Constitution and the laws in place. 76chanrobleslaw (r) R.A. No. 8749, Clean Air Act;

Put otherwise, there can be no valid objection to this Courts discretion to waive one or x x x x
some procedural requirements if only to remove any impediment to address and
resolve the serious constitutional question77 raised in these petitions of transcendental (y) Provisions in C.A. No. 141, x x x; and other existing laws that relate to the
importance, the same having far-reaching implications insofar as the safety and conservation, development, preservation, protection and utilization of the
general welfare of the residents of Manila, and even its neighboring communities, are environment and natural resources.82 (Emphasis supplied)
concerned.
Notably, the aforesaid Rules are limited in scope. While, indeed, there are allegations
Proper Remedy of violations of environmental laws in the petitions, these only serve as collateral
attacks that would support the other position of the petitioners the protection of the
Respondents and intervenors argue that the petitions should be outrightly dismissed right to life, security and safety.
for failure on the part of the petitioners to properly apply related provisions of the
Constitution, the Rules of Court, and/or the Rules of Procedure for Environmental Moreover, it bears emphasis that the promulgation of the said Rules was specifically
Cases relative to the appropriate remedy available to them. intended to meet the following objectives:
SEC. 3. Objectives.The objectives of these Rules are:chanroblesvirtuallawlibrary
To begin with, questioned is the applicability of Rule 6578 of the Rules of Court to
assail the validity and constitutionality of the Ordinance.
(a) To protect and advance the constitutional right of the people to a balanced and
there is no appeal, or any plain, healthful ecology;
speedy, and adequate remedy
in the ordinary course of law (b) To provide a simplified, speedy and inexpensive procedure for the enforcement of
environmental rights and duties recognized under the Constitution, existing laws,
Rule 65 specifically requires that the remedy may be availed of only when there is no rules and regulations, and international agreements;
appeal, or any plain, speedy, and adequate remedy in the ordinary course of
law.79chanrobleslaw (c) To introduce and adopt innovations and best practices ensuring the effective
enforcement of remedies and redress for violation of environmental laws; and
Shell argues that the petitioners should have sought recourse before the first and
second level courts under the Rules of Procedure for Environmental Cases, 80 which
(d) To enable the courts to monitor and exact compliance with orders and judgments
govern the enforcement or violations of environmental and other related laws, rules
in environmental cases.83
and regulations.81 Petron additionally submits that the most adequate remedy
available to petitioners is to have the assailed ordinance repealed by the Sangguniang
Panlungsod. In the alternative, a local referendum may be had. And, assuming that Surely, the instant petitions are not within the contemplation of these Rules.
there were laws violated, the petitioners may file an action for each alleged violation of
law against the particular individuals that transgressed the law. Relative to the position of Petron, it failed to consider that these petitions are already a
sequel to G.R. No. 156052, and that there are some issues herein raised that the
It would appear, however, that the remedies identified by the intervenors prove to be remedies available at the level of the Sangguniang Panlungsod could not address.
inadequate to resolve the present controversies in their entirety owing to the Neither could the filing of an individual action for each law violated be harmonized with
the essence of a plain, speedy, and adequate remedy. warrants that we set aside the technical defects and take primary jurisdiction
over the petition at bar. x x x This is in accordance with the well-entrenched
From another perspective, Shell finds fault with the petitioners direct recourse to this principle that rules of procedure are not inflexible tools designed to hinder or
Court when, pursuant to Section 5, Article VIII of the Constitution, the Supreme Court delay, but to facilitate and promote the administration of justice. Their strict and
exercises only appellate jurisdiction over cases involving the constitutionality or validity rigid application, which would result in technicalities that tend to frustrate,
of an ordinance.84 Thus: rather than promote substantial justice, must always be eschewed. (Emphasis
supplied)
Section 5. The Supreme Court shall have the following
powers:chanroblesvirtuallawlibrary persons aggrieved thereby

xxxx
2. Review, revise, reverse, modify, or affirm on appeal or certiorari, as the law or
the Rules of Court may provide, final judgments and orders of lower
courts in:chanroblesvirtuallawlibrary
a. All cases in which the constitutionality or validity of any treaty, international or
executive agreement, law, presidential decree, proclamation, order,
instruction, ordinance, or regulation is in question. (Emphasis supplied)
To further support its position, it cites the case of Liga ng mga Barangay National v.
City Mayor of Manila,85 where the petitioners sought the nullification of the mayors
executive order and the councils ordinance concerning certain functions of the
petitioners that are vested in them by law. There, the Court held:
Second, although the instant petition is styled as a petition for certiorari, in essence, it
seeks the declaration by this Court of the unconstitutionality or illegality of the
questioned ordinance and executive order. It, thus, partakes of the nature of a petition
for declaratory relief over which this Court has only appellate, not original,
jurisdiction.86 Section 5, Article VIII of the Constitution provides: x x x
As such, this petition must necessary fail, as this Court does not have original
jurisdiction over a petition for declaratory relief even if only questions of law are
involved.87
Assuming that a petition for declaratory relief is the proper remedy, and that the
petitions should have been filed with the Regional Trial Court, we have, time and
again, resolved to treat such a petition as one for prohibition, provided that the case
has far-reaching implications and transcendental issues that need to be resolved,88 as
in these present petitions.
On a related issue, we initially found convincing the argument that the petitions should
have been filed with the Regional Trial Court, it having concurrent jurisdiction with this
Court over a special civil action for prohibition, and original jurisdiction over petitions
for declaratory relief.
However, as we have repeatedly said, the petitions at bar are of transcendental
importance warranting a relaxation of the doctrine of hierarchy of courts. 89 In the case
of Jaworski v. PAGCOR,90the Court ratiocinated:
Granting arguendo that the present action cannot be properly treated as a petition for
prohibition, the transcendental importance of the issues involved in this case
As to who may file a petition for certiorari, prohibition or mandamus, Petron posits that
petitioners are not among the persons aggrieved contemplated under Sections 1 to 3
of Rule 65 of the Rules of Court.
Chevron argues that petitioners, whether as citizens, taxpayers, or legislators, lack
the legal standing to assail the validity and constitutionality of Ordinance No. 8187. It
further claims that petitioners failed to show that they have suffered any injury and/or
threatened injury as a result of the act complained of. 91chanrobleslaw
Shell also points out that the petitions cannot be considered taxpayers suit, for then,
there should be a claim that public funds were illegally disbursed and that petitioners
have sufficient interest concerning the prevention of illegal expenditure of public
money.92 In G.R. No. 187916, Shell maintains that the petitioners failed to show their
personal interest in the case and/or to establish that they may represent the general
sentiments of the constituents of the City of Manila so as to be treated as a class suit.
Even the minors, it argues, are not numerous and representative enough for the
petition to be treated as a class suit. As to the city councilors who joined the
petitioners in assailing the validity of Ordinance No. 8187, Shell posits that they cannot
invoke the ruling in Prof. David v. Pres. Macapagal-Arroyo,93 where the Court held that
legislators may question the constitutionality of a statute, if and when it infringes upon
their prerogatives as legislators, because of the absence of the allegation that the
assailed ordinance indeed infringes upon their prerogatives.
Former Mayor Lim submitted a similar position supported by a number of cases on the
concept oflocus standi,94 the direct injury test,95 an outline of the stringent
requirements of legal standing when suing as a citizen, 96 as a taxpayer,97 as a
legislator and in cases where class suits are filed in behalf of all
citizens.98chanrobleslaw
Their arguments are misplaced.
In G.R. No. 156052, we ruled that the petitioners in that case have a legal right to seek
the enforcement of Ordinance No. 8027 because the subject of the petition concerns a
public right, and they, as residents of Manila, have a direct interest in the
implementation of the ordinances of the city. Thus:
To support the assertion that petitioners have a clear legal right to the enforcement of
the ordinance, petitioner SJS states that it is a political party registered with the
Commission on Elections and has its offices in Manila. It claims to have many
members who are residents of Manila. The other petitioners, Cabigao and Tumbokon,
are allegedly residents of Manila.
We need not belabor this point. We have ruled in previous cases that when in excess of its or his jurisdiction,
amandamus proceeding concerns a public right and its object is to compel a public or with grave abuse of discretion
duty, the people who are interested in the execution of the laws are regarded as the amounting to lack or excess of jurisdiction
real parties in interest and they need not show any specific interest. Besides, as
residents of Manila, petitioners have a direct interest in the enforcement of the citys Petron takes issue with the alleged failure of the petitioners to establish the facts with
ordinances.99x x x (Citations omitted) certainty that would show that the acts of the respondents fall within the parameters of
the grave abuse of discretion clause settled by jurisprudence, to
wit:chanRoblesvirtualLawlibrary
No different are herein petitioners who seek to prohibit the enforcement of the assailed x x x [G]rave abuse of discretion means such capricious and whimsical exercise
ordinance, and who deal with the same subject matter that concerns a public right. of judgment as is equivalent to lack of jurisdiction. The abuse of discretion must be
Necessarily, the people who are interested in the nullification of such an ordinance are grave as where the power is exercised in an arbitrary or despotic manner by reason of
themselves the real parties in interest, for which reason, they are no longer required to passion or personal hostility and must be so patent and gross as to amount to an
show any specific interest therein. Moreover, it is worth mentioning that SJS, now evasion of positive duty or to a virtual refusal to perform the duty enjoined by or to act
represented by SJS Officer Alcantara, has been recognized by the Court in G.R. No. all in contemplation of law.102
156052 to have legal standing to sue in connection with the same subject matter
herein considered. The rest of the petitioners are residents of Manila. Hence, all of
them have a direct interest in the prohibition proceedings against the enforcement of
the assailed ordinance. It is pointless to discuss the matter at length in these instant cases of transcendental
importance in view of the Courts pronouncement, in Magallona v. Ermita.103 There it
In the case of Initiatives for Dialogue and Empowerment through Alternative Legal held that the writs of certiorariand prohibition are proper remedies to test the
Services, Inc. (IDEALS, INC.) v. Power Sector Assets and Liabilities Management constitutionality of statutes, notwithstanding the following
Corporation (PSALM),100 involving a petition for certiorari and prohibition to defects:chanRoblesvirtualLawlibrary
permanently enjoin PSALM from selling the Angat Hydro-Electric Power Plant In praying for the dismissal of the petition on preliminary grounds, respondents seek a
(AHEPP) to Korea Water Resources Corporation (K-Water), the Court strict observance of the offices of the writs of certiorari and prohibition, noting that the
ruled:chanRoblesvirtualLawlibrary writs cannot issue absent any showing of grave abuse of discretion in the
Legal standing or locus standi has been defined as a personal and substantial exercise of judicial, quasi-judicial or ministerial powers on the part of
interest in the case such that the party has sustained or will sustain direct injury as a respondents and resulting prejudice on the part of petitioners.
result of the governmental act that is being challenged, alleging more than a
generalized grievance. x x x This Court, however, has adopted a liberal attitude on the Respondents submission holds true in ordinary civil proceedings. When this Court
locus standi of a petitioner where the petitioner is able to craft an issue of exercises its constitutional power of judicial review, however, we have, by tradition,
transcendental significance to the people, as when the issues raised are of paramount viewed the writs of certiorari and prohibition as proper remedial vehicles to test the
importance to the public. Thus, when the proceeding involves the assertion of a constitutionality of statutes, and indeed, of acts of other branches of government.
public right, the mere fact that the petitioner is a citizen satisfies the Issues of constitutional import x x x carry such relevance in the life of this
requirement of personal interest. nation that the Court inevitably finds itself constrained to take cognizance of the
case and pass upon the issues raised, non-compliance with the letter of
There can be no doubt that the matter of ensuring adequate water supply for domestic procedural rules notwithstanding. The statute sought to be reviewed here is one
use is one of paramount importance to the public. That the continued availability of such law.104 (Emphasis supplied; citations omitted)
potable water in Metro Manila might be compromised if PSALM proceeds with the
privatization of the hydroelectric power plant in the Angat Dam Complex confers upon
petitioners such personal stake in the resolution of legal issues in a petition to stop its Requisites of judicial review
implementation.101 (Emphasis supplied; citations omitted)
For a valid exercise of the power of judicial review, the following requisites shall
concur: (1) the existence of a legal controversy; (2) legal standing to sue of the party
In like manner, the preservation of the life, security and safety of the people is raising the constitutional question; (3) a plea that judicial review be exercised at the
indisputably a right of utmost importance to the public. Certainly, the petitioners, as earliest opportunity; and (4) the constitutional question is the lis mota of the
residents of Manila, have the required personal interest to seek relief from this Court case.105chanrobleslaw
to protect such right.
Only the first two requisites are put in issue in these cases.
On the matter of the existence of a legal controversy, we reject the contention that the
petitions consist of bare allegations based on speculations, surmises, conjectures and
hypothetical grounds.
(a) at least one current identification document issued by an official agency bearing
The Court declared Ordinance No. 8027 valid and constitutional and ordered its the photograph and signature of the individual, such as but not limited to passport,
implementation. With the passing of the new ordinance containing the contrary drivers license, Professional Regulations Commission ID, National Bureau of
provisions, it cannot be any clearer that here lies an actual case or controversy for Investigation clearance, police clearance, postal ID, voters ID, Barangay
judicial review. The allegation on this, alone, is sufficient for the purpose. certification, Government Service and Insurance System (GSIS) e-card, Social
Security System (SSS) card, Philhealth card, senior citizen card, Overseas
The second requisite has already been exhaustively discussed. Workers Welfare Administration (OWWA) ID, OFW ID, seamans book, alien
certificate of registration/immigrant certificate of registration, government office ID,
Proof of identification required in the notarization certification from the National Council for the Welfare of Disable Persons
of the verification and certification against forum (NCWDP), Department of Social Welfare and Development (DSWD) certification;
shopping in G.R. No. 187916 or
At the bottom of the Verification and Certification against Forum Shopping of the
petition in G.R. No. 187916 is the statement of the notary public to the effect that the (b) x x x.109
affiant, in his presence and after presenting an integrally competent proof of
identification with signature and photograph,106 signed the document under oath.

Citing Sec. 163 of the Local Government Code,107 which provides that an individual
acknowledging any document before a notary public shall present his Community Tax
Certificate (CTC), Chevron posits that the petitioners failure to present his CTC Forum shopping
rendered the petition fatally defective warranting the outright dismissal of the petition.
Shell contends that the petitioners in G.R. No. 187836 violated the rule against forum
We disagree. shopping allegedly because all the elements thereof are present in relation to G.R. No.
156052, to wit:chanroblesvirtuallawlibrary
The verification and certification against forum shopping are governed specifically by
Sections 4 and 5, Rule 7 of the Rules of Court. 1. identity of parties, or at least such parties who represent the same interests in both
actions
Section 4 provides that a pleading, when required to be verified, shall be treated as an
unsigned pleading if it lacks a proper verification while Section 5 requires that the According to Shell, the interest of petitioner SJS in G.R. No. 156052 and the officers of
SJS in G.R. No. 187836 are clearly the same. Moreover, both actions implead the
certification to be executed by the plaintiff or principal party be under oath.
incumbent mayor of the City of Manila as respondent. Both then respondent Mayor
These sections, in turn, should be read together with Sections 6 and 12, Rule 2 of the Atienza in G.R. No. 156052 and respondent former Mayor Lim in G.R. No. 187836 are
sued in their capacity as Manila mayor.
2004 Rules on Notarial Practice.

Section 6108 of the latter Rules, specifically, likewise provides that any competent 2. identity of rights asserted and relief prayed for, the relief being founded on the
same fact(s)
evidence of identity specified under Section 12 thereof may now be presented before
the notary public, to wit:chanRoblesvirtualLawlibrary
Shell contends that, in both actions, petitioners assert the same rights to health and to
SEC. 12. Competent Evidence of Identity. - The phrase competent evidence of a balanced and healthful ecology relative to the fate of the Pandacan terminal, and
identity refers to the identification of an individual based seek essentially the same reliefs, that is, the removal of the oil depots from the
on:chanroblesvirtuallawlibrary present site.

3. the identity of the two preceding particulars is such that any judgment rendered in
the pending case, regardless of which party is successful, would amount to res
judicata in the other

Relative to the filing of the Manifestation and Motion to: a) Stop the City Council of
Manila from further hearing the amending ordinance to Ordinance No. 8027 x x x
(Manifestation and Motion) and Very Urgent Motion to Stop the Mayor of the City of
Manila from Signing Draft Ordinance No. 7177 [now Ordinance No. 8187] and to Cite
Him for Contempt if He Would Do So (Urgent Motion) both in G.R. No. 156052, Shell
points out the possibility that the Court would have rendered conflicting rulings on
cases involving the same facts, parties, issues and reliefs prayed for.110chanrobleslaw
We are not persuaded.
In Spouses Cruz v. Spouses Caraos,111 the Court expounded on the nature of forum
shopping. Thus:chanRoblesvirtualLawlibrary
Forum shopping is an act of a party, against whom an adverse judgment or order has
been rendered in one forum, of seeking and possibly getting a favorable opinion in
another forum, other than by appeal or special civil action for certiorari. It may also be
the in
stitution of two or more actions or proceedings grounded on the same cause on the
supposition that one or the other court would make a favorable disposition. The
established rule is that for forum shopping to exist, both actions must involve the same
transactions, same essential facts and circumstances and must raise identical causes
of actions, subject matter, and issues. x x x112 (Citations omitted)
It bears to stress that the present petitions were initially filed, not to secure a judgment
adverse to the first decision, but, precisely, to enforce the earlier ruling to relocate the
oil depots from the Pandacan area.
As to the matter of the denial of the petitioners Manifestation and Urgent Motion in
G.R. No. 156052, which were both incidental to the enforcement of the decision
favorable to them brought about by the intervening events after the judgment had
become final and executory, and which involve the same Ordinance assailed in these
petitions, we so hold that the filing of the instant petitions is not barred byres judicata.
In the same case of Spouses Cruz v. Spouses Caraos involving the re-filing of a
complaint, which had been earlier dismissed without qualification that the dismissal
was with prejudice, and which had not been decided on the merits, the Court declared
that such re-filing did not amount to forum shopping. It
ratiocinated:chanRoblesvirtualLawlibrary
It is not controverted that the allegations of the respective complaints in both Civil
Case No. 95-1387 and Civil Case No. 96-0225 are similarly worded, and are identical
in all relevant details, including typographical errors, except for the additional
allegations in support of respondents prayer for the issuance of preliminary injunction
in Civil Case No. 95-1387. It is similarly not disputed that both actions involve the
same transactions; same essential facts and circumstances; and raise identical
causes of actions, subject matter, and issues.cralawred
x x x x
x x x The dismissal of Civil Case No. 95-1387 was without prejudice. Indeed, the
Order dated 20 November 1995, dismissing Civil Case No. 95-1387 was an
unqualified dismissal. More significantly, its dismissal was not based on grounds
under paragraphs (f), (h), and (i) of Section 1 of Rule 16 of the Rules of Court, which
dismissal shall bar the refiling of the same action or claim as crystallized in Section 5
of Rule 16 thereof, thus:chanRoblesvirtualLawlibrary
SEC. 5. Effect of dismissal. Subject to the right of appeal, an order granting a motion
to dismiss based on paragraphs (f), (h), and (i) of section 1 hereof shall bar the refiling
of the same action or claim.
From the foregoing, it is clear that dismissals under paragraphs (f), (h), and (i) of
Section 1 of Rule 16 of the Rules of Court constitute res judicata, to
wit:chanRoblesvirtualLawlibrary
(f) That the cause of action is barred by a prior judgment or by the statute of
limitations;
x x x x
(h) That the claim or demand set forth in the plaintiffs pleading has been paid, waived,
abandoned, or otherwise extinguished;
(i) That the claim on which the action is founded is unenforceable under the provisions
of the statute of frauds.
Res judicata or bar by prior judgment is a doctrine which holds that a matter that has
been adjudicated by a court of competent jurisdiction must be deemed to have been
finally and conclusively settled if it arises in any subsequent litigation between the
same parties and for the same cause. Res judicata exists when the following elements
are present: (a) the former judgment must be final; (b) the court which rendered
judgment had jurisdiction over the parties and the subject matter; (3) it must be a
judgment on the merits; and (d) and there must be, between the first and second
actions, identity of parties, subject matter, and cause of action. 113 (Emphasis supplied;
citations omitted)
Here, it should be noted that this Court denied the said Manifestation and Urgent
Motion, and refused to act on the succeeding pleadings, for being moot. 114 Clearly, the
merits of the motion were not considered by the Court. The following disquisition of the
Court in Spouses Cruz v. Spouses Caraos is further
enlightening:chanRoblesvirtualLawlibrary
The judgment of dismissal in Civil Case No. 95-1387 does not constitute res
judicata to sufficiently bar the refiling thereof in Civil Case No. 96-0225. As earlier
underscored, the dismissal was one without prejudice. Verily, it was not a judgment on
the merits. It bears reiterating that a judgment on the merits is one rendered after
a determination of which party is right, as distinguished from a judgment
rendered upon some preliminary or formal or merely technical point. The
dismissal of the case without prejudice indicates the absence of a decision on the
merits and leaves the parties free to litigate the matter in a subsequent action as
though the dismissed action had not been commenced. 115 (Emphasis supplied;
citations omitted)
Considering that there is definitely no forum shopping in the instant cases, we need
not discuss in detail the elements of forum shopping.chanrobleslaw
II
The Local Government Code of 1991 expressly provides that the Sangguniang
Panlungsod is vested with the power to reclassify land within the jurisdiction of the
city116 subject to the pertinent provisions of the Code. It is also settled that an
ordinance may be modified or repealed by another ordinance.117 These have been
properly applied in G.R. No. 156052, where the Court upheld the position of
the Sangguniang Panlungsod to reclassify the land subject of the Ordinance,118 and
declared that the mayor has the duty to enforce Ordinance No. 8027, provided that it
has not been repealed by the Sangguniang Panlungsod or otherwise annulled by the
courts.119 In the same case, the Court also used the principle that the Sanguniang
Panlungsod is in the best position to determine the needs of its constituents 120 that
the removal of the oil depots from the Pandacan area is necessary to protect the
residents of Manila from catastrophic devastation in case of a terrorist attack on the
Pandacan Terminals.121chanrobleslaw
Do all these principles equally apply to the cases at bar involving the same subject
matter to justify the contrary provisions of the assailed Ordinance?
We answer in the negative.
We summarize the position of the Sangguniang Panlungsod on the matter subject of
these petitions. In 2001, the Sanggunian found the relocation of the Pandacan oil
depots necessary. Hence, the enactment of Ordinance No. 8027.
In 2009, when the composition of the Sanggunian had already changed, Ordinance
No. 8187 was passed in favor of the retention of the oil depots. In 2012, again when
some of the previous members were no longer re-elected, but with the Vice-Mayor still
holding the same seat, and pending the resolution of these petitions, Ordinance No.
8283 was enacted to give the oil depots until the end of January 2016 within which to
transfer to another site. Former Mayor Lim stood his ground and vetoed the last
ordinance.
th
In its Comment, the 7 Council (2007-2010) alleged that the assailed Ordinance was
enacted to alleviate the economic condition of its constituents. 122chanrobleslaw
Expressing the same position, former Mayor Lim even went to the extent of detailing
the steps123 he took prior to the signing of the Ordinance, if only to show his honest
intention to make the right decision.
The fact remains, however, that notwithstanding that the conditions with respect to the
operations of the oil depots existing prior to the enactment of Ordinance No. 8027 do
not substantially differ to this day, as would later be discussed, the position of
the Sangguniang Panlungsod on the matter has thrice changed, largely depending on
the new composition of the council and/or political affiliations. The foregoing, thus,
shows that its determination of the general welfare of the city does not after all gear
towards the protection of the people in its true sense and meaning, but is, one way or
another, dependent on the personal preference of the members who sit in the council
as to which particular sector among its constituents it wishes to favor.
Now that the City of Manila, through the mayor and the city councilors, has changed
its view on the matter, favoring the citys economic-related benefits, through the
continued stay of the oil terminals, over the protection of the very lives and safety of its
constituents, it is imperative for this Court to make a final determination on the basis of
the facts on the table as to which specific right of the inhabitants of Manila should
prevail. For, in this present controversy, history reveals that there is truly no such thing
as the will of Manila insofar as the general welfare of the people is concerned.
If in sacrilege, in free translation of Angara124 by Justice Laurel, we say when the
judiciary mediates we do not in reality nullify or invalidate an act of the
Manila Sangguniang Panlungsod, but only asserts the solemn and sacred obligation
assigned to the Court by the Constitution to determine conflicting claims of authority
under the Constitution and to establish for the parties in an actual controversy the
rights which that instrument secures and guarantees to them.chanrobleslaw
III
The measures taken by the intervenors to lend support to their position that Manila is
now safe despite the presence of the oil terminals remain ineffective. These have not
completely removed the threat to the lives of the inhabitants of Manila.
In G.R. No. 156052, the validity and constitutionality of Ordinance No. 8027 was
declared as a guarantee for the protection of the constitutional right to life of the
residents of Manila. There, the Court said that the enactment of the said ordinance
was a valid exercise of police power with the concurrence of the two requisites: a
lawful subject to safeguard the rights to life, security and safety of all the inhabitants
of Manila;125 and a lawful method the enactment of Ordinance No. 8027
reclassifying the land use from industrial to commercial, which effectively ends the
continued stay of the oil depots in Pandacan.126chanrobleslaw
In the present petitions, the respondents and the oil companies plead that the
Pandacan Terminal has never been one of the targets of terrorist attacks;127 that the
petitions were based on unfounded fears and mere conjectures; 128 and that the
possibility that it would be picked by the terrorists is nil given the security measures
installed thereat.129chanrobleslaw
The intervenors went on to identify the measures taken to ensure the safety of the
people even with the presence of the Pandacan Terminals.
Thus:chanroblesvirtuallawlibrary
1. Chevron claims that it, together with Shell and Petron, continues to enhance the
safety and security features of the terminals. They likewise adopt fire and product spill
prevention measures in accordance with the local standards set by the Bureau of Fire
Protection, among others, and with the international standards of the American
Petroleum Industry (API) and the National Fire Prevention and Safety Association
(NFPSA); that since 1914, the oil depots had not experienced any incident
beyond the ordinary risks and expectations130 of the residents of Manila; and that
it received a passing grade on the safety measures they installed in the facilities from
the representatives of the City of Manila who conducted an ocular inspection on 22
May 2009; and
2. Referring to the old MOU entered into between the City of Manila and the DOE, on
the one hand, and the oil companies, on the other, where the parties thereto conceded
and acknowledged that the scale-down option for the Pandacan Terminal operations
is the best alternative to the relocation of the terminals, Shell enumerates the steps
taken to scale down its operations.
As to the number of main fuel tanks, the entire Pandacan Terminal has already
decommissioned twenty-eight out of sixty-four tanks. Speaking for Shell alone, its LPG
Spheres, which it claims is the only product that may cause explosion, was part of
those decommissioned, thereby allegedly removing the danger of explosion. Safety
buffer zones and linear/green parks were likewise created to separate the terminal
from the nearest residential area. Shells portion of the oil depot is likewise allegedly
equipped with the latest technology to ensure air-quality control and water-quality
control, and to prevent and cope with possible oil spills with a crisis management plan
in place in the event that an oil spill occurs. Finally, Shell claims that the
recommendations of EQE International in its Quantitative Risk Assessment (QRA)
study, which it says is one of the leading independent risk assessment providers in the
world and largest risk management consultancy, were sufficiently complied with; and
that, on its own initiative, it adopted additional measures for the purpose, for which
reason, the individual risk level resulting from any incident occurring from the
Pandacan Terminal, per the QRA study, is twenty (20) times lower compared to the
individual risk level of an average working or domestic environment.131chanrobleslaw
We are not persuaded.
The issue of whether or not the Pandacan Terminal is not a likely target of terrorist
attacks has already been passed upon in G. R. No. 156052. Based on the
assessment of the Committee on Housing, Resettlement and Urban Development of
the City of Manila and the then position of theSangguniang Panlungsod,132 the Court
was convinced that the threat of terrorism is imminent. It remains so convinced.
Even assuming that the respondents and intervenors were correct, the very nature of
the depots where millions of liters of highly flammable and highly volatile products,
regardless of whether or not the composition may cause explosions, has no place in a
densely populated area. Surely, any untoward incident in the oil depots, be it related to
terrorism of whatever origin or otherwise, would definitely cause not only destruction to
properties within and among the neighboring communities but certainly mass deaths
and injuries.
With regard to the scaling down of the operations in the Pandacan Terminals, which
the oil companies continue to insist to have been validated and recognized by the
MOU, the Court, in G.R. No. 156052, has already put this issue to rest. It specifically
declared that even assuming that the terms of the MOU and Ordinance No. 8027 were
inconsistent, the resolutions ratifying the MOU gave it full force and effect only until 30
April 2003.133chanrobleslaw
The steps taken by the oil companies, therefore, remain insufficient to convince the
Court that the dangers posed by the presence of the terminals in a thickly populated
area have already been completely removed.
For, given that the threat sought to be prevented may strike at one point or another, no
matter how remote it is as perceived by one or some, we cannot allow the right to life
to be dependent on the unlikelihood of an event. Statistics and theories of probability
have no place in situations where the very life of not just an individual but of residents
of big neighborhoods is at stake.chanrobleslaw
IV
It is the removal of the danger to life not the mere subdual of risk of catastrophe, that
we saw in and made us favor Ordinance No. 8027. That reason, unaffected by
Ordinance No. 8187, compels the affirmance of our Decision in G.R. No. 156052.
In striking down the contrary provisions of the assailed Ordinance relative to the
continued stay of the oil depots, we follow the same line of reasoning used in G.R. No.
156052, to wit:chanRoblesvirtualLawlibrary
Ordinance No. 8027 was enacted for the purpose of promoting sound urban planning,
ensuring health, public safety and general welfare of the residents of Manila.
TheSanggunian was impelled to take measures to protect the residents of Manila from
catastrophic devastation in case of a terrorist attack on the Pandacan Terminals.
Towards this objective, the Sanggunian reclassified the area defined in the ordinance
from industrial to commercial.
The following facts were found by the Committee on Housing, Resettlement and
Urban Development of the City of Manila which recommended the approval of the
ordinance:
 The same best interest of the public guides the present decision. The Pandacan oil
depot remains a terrorist target even if the contents have been lessened. In the
absence of any convincing reason to persuade this Court that the life, security and
safety of the inhabitants of Manila are no longer put at risk by the presence of the oil
depots, we hold that Ordinance No. 8187 in relation to the Pandacan Terminals is
invalid and unconstitutional.

(1) the depot facilities contained 313.5 million liters of highly flammable and highly There is, therefore, no need to resolve the rest of the issues.
volatile products which include petroleum gas, liquefied petroleum gas, aviation
fuel, diesel, gasoline, kerosene and fuel oil among others; Neither is it necessary to discuss at length the test of police power against the
assailed ordinance. Suffice it to state that the objective adopted by the Sangguniang
Panlungsod to promote the constituents general welfare in terms of economic benefits
(2) the depot is open to attack through land, water or air; cannot override the very basic rights to life, security and safety of the people.

(3) it is situated in a densely populated place and near Malacaang Palace; and
(4) in case of an explosion or conflagration in the depot, the fire could spread to the
neighboring communities.
In. G.R. No. 156052, the Court explained:chanRoblesvirtualLawlibrary
Essentially, the oil companies are fighting for their right to property. They allege that
they stand to lose billions of pesos if forced to relocate. However, based on the
hierarchy of constitutionally protected rights, the right to life enjoys precedence over
the right to property. The reason is obvious: life is irreplaceable, property is not. When
the state or LGUs exercise of police power clashes with a few individuals right to
property, the former should prevail.135

The ordinance was intended to safeguard the rights to life, security and safety of all
the inhabitants of Manila and not just of a particular class. The depot is perceived, We thus conclude with the very final words in G.R. No.
rightly or wrongly, as a representation of western interests which means that it is a 156052:chanRoblesvirtualLawlibrary
terrorist target. As long as it (sic) there is such a target in their midst, the residents of
Manila are not safe. It therefore became necessary to remove these terminals to On Wednesday, January 23, 2008, a defective tanker containing 2,000 liters of
dissipate the threat. According to respondent:chanRoblesvirtualLawlibrary gasoline and 14,000 liters of diesel exploded in the middle of the street a short
distance from the exit gate of the Pandacan Terminals, causing death, extensive
Such a public need became apparent after the 9/11 incident which showed that what damage and a frightening conflagration in the vicinity of the incident. Need we say
was perceived to be impossible to happen, to the most powerful country in the world at anthing about what will happen if it is the estimated 162 to 211 million liters [or
that, is actually possible. The destruction of property and the loss of thousands of lives whatever is left of the 26 tanks] of petroleum products in the terminal complex will
on that fateful day became the impetus for a public need. In the aftermath of the 9/11 blow up?136
tragedy, the threats of terrorism continued [such] that it became imperative for
governments to take measures to combat their effects.
V

x x x x
Both law and jurisprudence support the constitutionality and validity of Ordinance No.
8027. Without a doubt, there are no impediments to its enforcement and
implementation. Any delay is unfair to the inhabitants of the City of Manila and its
leaders who have categorically expressed their desire for the relocation of the
terminals. Their power to chart and control their own destiny and preserve their lives
and safety should not be curtailed by the intervenors warnings of doomsday scenarios
and threats of economic disorder if the ordinance is enforced.134
As in the prequel case, we note that as early as October 2001, the oil companies
signed a MOA with the DOE obliging themselves to:chanRoblesvirtualLawlibrary
... undertake a comprehensive and comparative study ... [which] shall include the
preparation of a Master Plan, whose aim is to determine the scope and timing of the
feasible location of the Pandacan oil terminals and all associated facilities and
infrastructure including government support essential for the relocation such as the
necessary transportation infrastructure, land and right of way acquisition, resettlement
of displaced residents and environmental and social acceptability which shall be
based on mutual benefit of the Parties and the public.
such that:chanRoblesvirtualLawlibrary
Now that they are being compelled to discontinue their operations in the Pandacan
Terminals, they cannot feign unreadiness considering that they had years to prepare
for this eventuality.137
On the matter of the details of the relocation, the Court gave the oil companies the
following time frames for compliance:chanRoblesvirtualLawlibrary
To ensure the orderly transfer, movement and relocation of assets and personnel, the
intervenors Chevron Philippines Inc., Petron Corporation and Pilipinas Shell
Petroleum Corporation shall, within a non-extendible period of ninety (90) days, submit
to the Regional Trial Court of Manila, Branch 39, the comprehensive plan and
relocation schedule which have allegedly been prepared. The presiding judge of
Manila RTC, Branch 39 will monitor the strict enforcement of this resolution.138
The periods were given in the Decision in G.R. No. 156052 which became final on 23
April 2009. Five years have passed, since then. The years of non-compliance may be
excused by the swing of local legislative leads. We now stay the sway and begin a
final count.
A comprehensive and well-coordinated plan within a specific time-frame shall,
therefore, be observed in the relocation of the Pandacan Terminals. The oil
companies shall be given a fresh non-extendible period of forty-five (45) days from
notice within which to submit to the Regional Trial Court, Branch 39, Manila an
updated comprehensive plan and relocation schedule. The relocation, in turn, shall be
completed not later than six months from the date of their submission.
Finally, let it be underscored that after the last Manifestation filed by Shell informing
this Court that respondent former Mayor Lim vetoed Ordinance No. 8283 for the
second time, and was anticipating its referral to the President for the latters
consideration, nothing was heard from any of the parties until the present petitions as
to the status of the approval or disapproval of the said ordinance. As it is, the fate of
the Pandacan Terminals remains dependent on this final disposition of these
cases.chanrobleslaw
VI
On the matter of the failure of Atty. Gempis to immediately comply with the directives
of this Court to file the Memorandum for the Vice-Mayor and the city councilors who
voted in favor of the assailed Ordinance, the records do not bear proof that he
received a copy of any of the resolutions pertaining to the filing of the Memorandum.
A narration of the events from his end would show, however, that he was aware of the
directive issued in 2009 when he stated that when the City Legal Officer filed its
Memorandum dated 8 February 2010, [he] thought the filing of a Memorandum for the
other respondent city officials could be dispensed with.139 There was also a
categorical admission that he received the later Resolution of 31 May 2011 but that he
could not prepare a Memorandum defending the position of respondents vice-mayor
and the city councilors who voted in favor of Ordinance No. 8187 in view of the on-
going drafting of Ordinance No. 8283, which would change the position of
the Sanggunian, if subsequently approved.
The reasons he submitted are not impressed with merit.
That he was not officially designated as the counsel for the vice-mayor and the city
councilors is beside the point. As an officer of the court, he cannot feign ignorance of
the fact that a resolution of this Court is not a mere request but an order which should
be complied with promptly and completely.140 As early as 2009, he should have
immediately responded and filed a Manifestation and therein set forth his reasons why
he cannot represent the vice-mayor and the city councilors. And, even assuming that
the 31 May 2011 Resolution was the first directive he personally received, he had no
valid excuse for disregarding the same. Worse, the Court had to issue a show cause
order before he finally heeded.
Atty. Gempis should strive harder to live up to his duties of observing and maintaining
the respect due to the courts, respect for law and for legal processes and of upholding
the integrity and dignity of the legal profession in order to perform his responsibilities
as a lawyer effectively.141chanrobleslaw
In Sibulo v. Ilagan,142 which involves a lawyers repeated failure to comply with the
directives of the Court, the penalty recommended by the Integrated Bar of the
Philippines was reduced from suspension to reprimand and a warning. The Court
ratiocinated:chanRoblesvirtualLawlibrary
Considering, however, that respondent was absolved of the administrative charge
against him and is being taken to task for his intransigence and lack of respect, the
Court finds that the penalty of suspension would not be warranted under the
circumstances.cralawred
x x x x
To the Courts mind, a reprimand and a warning are sufficient sanctions for
respondents disrespectful actuations directed against the Court and the IBP. The
imposition of these sanctions in the present case would be more consistent with the
avowed purpose of disciplinary case, which is not so much to punish the individual
attorney as to protect the dispensation of justice by sheltering the judiciary and the
public from the misconduct or inefficiency of officers of the court.143
We consider the participation of Atty. Gempis in this case and opt to be lenient even
as we reiterate the objective of protecting the dispensation of justice. We deem it
sufficient to remind Atty. Gempis to be more mindful of his duty as a lawyer towards or purpose as stated in the Complaint, upon payment of just
the Court. compensation.

WHEREFORE, in light of all the foregoing, Ordinance No. 8187 is hereby Accordingly, in order to ascertain the just compensation, the
declaredUNCONSTITUTIONAL and INVALID with respect to the continued stay of the parties are hereby directed to submit to the Court within fifteen
Pandacan Oil Terminals. (15) days from notice hereof, a list of independent appraisers from
which the Court t will select three (3) to be appointed as
The incumbent mayor of the City of Manila is hereby ordered Commissioners, pursuant to Section 5, Rule 67, Rules of Court.
to CEASE and DESIST from enforcing Ordinance No. 8187. In coordination with the SO ORDERED.[2]ella
appropriate government agencies and the parties herein involved, he is further
ordered to oversee the relocation and transfer of the oil terminals out of the Pandacan It is undisputed by the parties that on October 13, 1994, the Sangguniang Panlungsod
area. of Mandaluyong City issued Resolution No. 396, S-1994[3] authorizing then Mayor
Benjamin S. Abalos to institute expropriation proceedings over the property of Alberto
As likewise required in G.R. No. 156052, the intervenors Chevron Philippines, Inc., Sugui located at Boni Avenue and Sto. Rosario streets in Mandaluyong City with an
Pilipinas Shell Petroleum Corporation, and Petron Corporation shall, within a non- area of 414 square meters and more particularly described under Transfer Certificate
extendible period of forty-five (45) days, submit to the Regional Trial Court, Branch 39, of Title No. 56264 of the Registry of Deeds of Metro Manila District II. The intended
Manila an updated comprehensive plan and relocation schedule, which relocation purpose of the expropriation was the expansion of the Mandaluyong Medical Center.
shall be completed not later than six (6) months from the date the required documents
are submitted. The presiding judge of Branch 39 shall monitor the strict enforcement Mayor Benjamin Abalos wrote Alberto Suguitan a letter dated January 20, 1995
of this Decision. offering to buy his property, but Suguitan refused to sell. [4] Consequently, on March
13, 1995, the city of Mandaluyong filed a complaint[5] for expropriation with the
For failure to observe the respect due to the Court, Atty. Luch R. Gempis, Jr., Regional Trial Court of Pasig. The case was docketed as SCA No. 875. novero
Secretary of theSangguniang Panlungsod, is REMINDED of his duties towards the Suguitan filed a motion to dismiss[6] the complaint based on the following grounds -(1)
Court and WARNED that a repetition of an act similar to that here committed shall be the power of eminent domain is not being exercised in accordance with law; (2) there
dealt with more severely. is no public necessity to warrant expropriation of subject property; (3) the City of
Mandaluyong seeks to expropriate the said property without payment of just
SO ORDERED.cralawlawlibrary compensation; (4) the City of Mandaluyong has no budget and appropriation for the
payment of the property being expropriated; and (5) expropriation of Suguitan' s
property is but a ploy of Mayor Benjamin Abalos to acquire the same for his personal
THIRD DIVISION use. Respondent filed its comment and opposition to the motion. On October 24,
1995, the trial court denied Suguitan's motion to dismiss.[7]
[G.R. No. 135087. March 14, 2000]
On November 14, 1995, acting upon a motion filed by the respondent, the trial court
HEIRS OF ALBERTO SUGUITAN, petitioner, vs. CITY OF issued an order allowing the City of Mandaluyong to take immediate possession of
MANDALUYONG, respondent Suguitan's property upon the deposit of P621,000 representing 15% of the fair market
value of the subject property based upon the current tax declaration of such property.
DECISION On December 15, 1995, the City of Mandaluyong assumed possession of the subject
GONZAGA_REYES, J.: property by virtue of a writ of possession issued by the trial court on December 14,
1995.[8] On July 28, 1998, the court granted the assailed order of expropriation.
In this petition for review on certiorari under Rule 45, petitioners[1] pray for the reversal
of the Order dated July 28, 1998 issued by Branch 155 of the Regional Trial Court of Petitioner assert that the city of Mandaluyong may only exercise its delegated power
Pasig in SCA No. 875 entitled "City of Mandaluyong v. Alberto S. Suguitan, the of eminent domain by means of an ordinance as required by section 19 of Republic
dispositive portion of which reads as follows: Act (RA) No. 7160,[9] and not by means of a mere resolution.[10] Respondent contends,
however, that it validly and legally exercised its power of eminent domain; that
WHEREFORE, in view of the foregoing, the instant Motion to pursuant to article 36, Rule VI of the Implementing Rules and Regulations (IRR) of RA
Dismiss is hereby DENIED and an ORDER OF 7160, a resolution is a sufficient antecedent for the filing of expropriation proceedings
CONDEMNATION is hereby issued declaring that the plaintiff, with the Regional Trial Court. Respondent's position, which was upheld by the trial
City of Mandaluyong, has a lawful right to take the subject parcel court, was explained, thus:[11]
of land together with existing improvements thereon more
specifically covered by Transfer Certificate Of Title No. 56264 of ...in the exercise of the respondent City of Mandaluyong's power
the Registry of Deeds for Metro Manila District II for the public use of eminent domain, a "resolution" empowering the City Mayor to
 initiate such expropriation proceedings and thereafter when the
court has already determine[d] with certainty the amount of just
compensation to be paid for the property expropriated, then
follows an Ordinance of the Sanggunian Panlungosd
appropriating funds for the payment of the expropriated property.
Admittedly, title to the property expropriated shall pass from the
owner to the expropriator only upon full payment of the just
compensation.[12] novero
Petitioners refute respondent's contention that only a resolution is necessary upon the
initiation of expropriation proceedings and that an ordinance is required only in order
to appropriate the funds for the payment of just compensation, explaining that the
resolution mentioned in article 36 of the IRR is for purposes of granting administrative
authority to the local chief executive to file the expropriation case in court and to
represent the local government unit in such case, but does not dispense with the
necessity of an ordinance for the exercise of the power of eminent domain under
section 19 of the Code.[13]
The petition is imbued with merit.
Eminent domain is the right or power of a sovereign state to appropriate private
property to particular uses to promote public welfare.[14] It is an indispensable attribute
of sovereignty; a power grounded in the primary duty of government to serve the
common need and advance the general welfare.[15] Thus, the right of eminent domain
appertains to every independent government without the necessity for constitutional
recognition.[16] The provisions found in modern constitutions of civilized countries
relating to the taking of property for the public use do not by implication grant the
power to the government, but limit a power which would otherwise be without
limit.[17] Thus, our own Constitution provides that "[p]rivate property shall not be taken
for public use without just compensation."[18] Furthermore, the due process and equal
protection clauses[19] act as additional safeguards against the arbitrary exercise of this
governmental power.
Since the exercise of the power of eminent domain affects an individual's right to
private property, a constitutionally-protected right necessary for the preservation and
enhancement of personal dignity and intimately connected with the rights to life and
liberty,[20] the need for its circumspect operation cannot be overemphasized. In City of
Manila vs. Chinese Community of Manila we said:[21]
The exercise of the right of eminent domain, whether directly by
the State, or by its authorized agents, is necessarily in derogation
of private rights, and the rule in that case is that the authority must
be strictly construed. No species of property is held by individuals
with greater tenacity, and none is guarded by the constitution and
the laws more sedulously, than the right to the freehold of
inhabitants. When the legislature interferes with that right, and, for
greater public purposes, appropriates the land of an individual
without his consent, the plain meaning of the law should not be
enlarged by doubt[ful] interpretation. (Bensley vs. Mountainlake
Water Co., 13 Cal., 306 and cases cited [73 Am. Dec. 576].)
The statutory power of taking property from the owner without his
consent is one of the most delicate exercise of governmental
authority. It is to be watched with jealous scrutiny. Important as
the power may be to the government, the inviolable sanctity which
all free constitutions attach to the right of property of the citizens,
constrains the strict observance of the substantial provisions of
the law which are prescribed as modes of the exercise of the
power, and to protect it from abuse. ...(Dillon on Municipal
Corporations [5th Ed.], sec. 1040, and cases cited; Tenorio vs.
Manila Railroad Co., 22 Phil., 411.)
The power of eminent domain is essentially legislative in nature. It is firmly settled,
however, that such power may be validly delegated to local government units, other
public entities and public utilities, although the scope of this delegated legislative
power is necessarily narrower than that of the delegating authority and may only be
exercised in strict compliance with the terms of the delegating law. [22] micks
The basis for the exercise of the power of eminent domain by local government units
is section 19 of RA 7160 which provides that:
A local government unit may, through its chief executive and
acting pursuant to an ordinance, exercise the power of eminent
domain for public use, purpose, or welfare for the benefits of the
poor and the landless, upon payment of just compensation,
pursuant to the provisions of the Constitution and pertinent
laws; Provided, however, That the power of eminent domain may
not be exercised unless a valid and definite offer has been
previously made to the owner, and such offer was not
accepted; Provided, further, That the local government unit may
immediately take possession of the property upon the filing of the
expropriation proceedings and upon making a deposit with the
proper court of at least fifteen percent (15%) of the fair market
value of the property based on the current tax declaration of the
property to be expropriated; Provided, finally, That the amount to
be paid for the expropriated property shall be determined by the
proper court, based on the fair market value at the time of the
taking of the property.
Despite the existence of this legislative grant in favor of local governments, it is still the
duty of the courts to determine whether the power of eminent domain is being
exercised in accordance with the delegating law. [23] In fact, the courts have adopted a
more censorious attitude in resolving questions involving the proper exercise of this
delegated power by local bodies, as compared to instances when it is directly
exercised by the national legislature.[24]
The courts have the obligation to determine whether the following requisites have
been complied with by the local government unit concerned:
1. An ordinance is enacted by the local legislative council
authorizing the local chief executive, in behalf of the local
government unit, to exercise the power of eminent domain or
 pursue expropriation proceedings over a particular private
property .calr
2. The power of eminent domain is exercised for public use,
purpose or welfare, or for the benefit of the poor and the landless.
3. There is payment of just compensation, as required under
Section 9, Article III of the Constitution, and other pertinent laws.
4. A valid and definite offer has been previously made to the
owner of the property sought to be expropriated, but said offer
was not accepted.[25]
In the present case, the City of Mandaluyong seeks to exercise the power of eminent
domain over petitioners' property by means of a resolution, in contravention of the first
requisite. The law in this case is clear and free from ambiguity. Section 19 of the Code
requires an ordinance, not a resolution, for the exercise of the power of eminent
domain.
We reiterate our ruling in Municipality of Paraaque v. V.M. Realty
Corporation regarding the distinction between an ordinance and a resolution. In that
1998 case we held that:
We are not convinced by petitioner's insistence that the terms
"resolution" and "ordinance" are synonymous. A municipal
ordinance is different from a resolution. An ordinance is a law, but
a resolution is merely a declaration of the sentiment or opinion of
a lawmaking body on a specific matter. An ordinance possesses a
general and permanent character, but a resolution is temporary in
nature. Additionally, the two are enacted differently -a third
reading is necessary for an ordinance, but not for a resolution,
unless decided otherwise by a majority of all
the Sanggunian members.
We cannot uphold respondent's contention that an ordinance is needed only to
appropriate funds after the court has determined the amount of just compensation. An
examination of the applicable law will show that an ordinance is necessary to
authorize the filing of a complaint with the proper court since, beginning at this point,
the power of eminent domain is already being exercised.
Rule 67 of the 1997 Revised Rules of Court reveals that expropriation proceedings are
comprised of two stages:
(1) the first is concerned with the determination of the authority of
the plaintiff to exercise the power of eminent domain and the
propriety of its exercise in the context of the facts involved in the
suit; it ends with an order, if not in a dismissal of the action, of
condemnation declaring that the plaintiff has a lawful right to take
the property sought to be condemned, for the public use or
purpose described in the complaint, upon the payment of just
compensation to be determined as of the date of the filing of the
complaint;
(2) the second phase is concerned with the determination by the
court of the just compensation for the property sought to be taken;
this is done by the court with the assistance of not more than
three (3) commissioners.[27]
Clearly, although the determination and award of just compensation to the defendant
is indispensable to the transfer of ownership in favor of the plaintiff, it is but the last
stage of the expropriation proceedings, which cannot be arrived at without an initial
finding by the court that the plaintiff has a lawful right to take the property sought to be
expropriated, for the public use or purpose described in the complaint. An order of
condemnation or dismissal at this stage would be final, resolving the question of
whether or not the plaintiff has properly and legally exercised its power of eminent
domain.
Also, it is noted that as soon as the complaint is filed the plaintiff shall already have
the right to enter upon the possession of the real property involved upon depositing
with the court at least fifteen percent (15%) of the fair market value of the property
based on the current tax declaration of the property to be expropriated. [28] Therefore,
an ordinance promulgated by the local legislative body authorizing its local chief
executive to exercise the power of eminent domain is necessary prior to the filing by
the latter of the complaint with the proper court, and not only after the court has
determined the amount of just compensation to which the defendant is entitled.basra
Neither is respondent's position improved by its reliance upon Article 36 (a), Rule VI of
the IRR which provides that:
If the LGU fails to acquire a private property for public use,
purpose, or welfare through purchase, LGU may expropriate said
property through a resolution of the sanggunian authorizing its
chief executive to initiate expropriation proceedings.
The Court has already discussed this inconsistency between the Code and the IRR,
which is more apparent than real, in Municipality of Paraaque vs. V.M. Realty
Corporation, which we quote hereunder:
Petitioner relies on Article 36, Rule VI of the Implementing Rules,
which requires only a resolution to authorize an LGU to exercise
eminent domain. This is clearly misplaced, because Section 19 of
RA 7160, the law itself, surely prevails over said rule which
merely seeks to implement it. It is axiomatic that the clear letter of
the law is controlling and cannot be amended by a mere
administrative rule issued for its implementation. Besides, what
the discrepancy seems to indicate is a mere oversight in the
wording of the implementing rules, since Article 32, Rule VI
thereof, also requires that, in exercising the power of eminent
domain, the chief executive of the LGU must act pursuant to an
ordinance.
Therefore, while we remain conscious of the constitutional policy of promoting local
autonomy, we cannot grant judicial sanction to a local government unit's exercise of its
delegated power of eminent domain in contravention of the very law giving it such
power.
It should be noted, however, that our ruling in this case will not preclude the City of
Mandaluyong from enacting the necessary ordinance and thereafter reinstituting
expropriation proceedings, for so long as it has complied with all other legal
requirements.
WHEREFORE, the petition is hereby GRANTED. The July 28, 1998 decision of
Branch 155 of the Regional Trial Court of Pasig in SCA No. 875 is hereby REVERSED
and SET ASIDE.
SO ORDERED.
FIRST DIVISION
[G.R. No. 127820. July 20, 1998]
MUNICIPALITY OF PARAAQUE, petitioner, vs. V.M. REALTY
CORPORATION, respondent.
DECISION
PANGANIBAN, J.:
A local government unit (LGU), like the Municipality of Paraaque, cannot
authorize an expropriation of private property through a mere resolution of its
lawmaking body. The Local Government Code expressly and clearly requires an
ordinance or a local law for the purpose. A resolution that merely expresses the
sentiment or opinion of the Municipal Council will not suffice. On the other hand, the
principle of res judicata does not bar subsequent proceedings for the expropriation of
the same property when all the legal requirements for its valid exercise are complied
with.
Statement of the Case
These principles are applied by this Court in resolving this petition for review
on certiorari of the July 22, 1996 Decision[1] of the Court of Appeals[2] in CA GR CV
No. 48048, which affirmed in toto[3] the Regional Trial Courts August 9, 1994
Resolution.[4] The trial court dismissed the expropriation suit as follows:
The right of the plaintiff to exercise the power of eminent domain is not
disputed. However, such right may be exercised only pursuant to an Ordinance (Sec.
19, R.A. No. 7160). In the instant case, there is no such ordinance passed by the
Municipal Council of Paraaque enabling the Municipality, thru its Chief Executive, to
exercise the power of eminent domain. The complaint, therefore, states no cause of
action.
Assuming that plaintiff has a cause of action, the same is barred by a prior
judgment. On September 29, 1987, the plaintiff filed a complaint for expropriation
involving the same parcels of land which was docketed as Civil Case No. 17939 of this
Court (page 26, record). Said case was dismissed with prejudice on May 18, 1988
(page 39, record). The order of dismissal was not appealed, hence, the same became
final. The plaintiff can not be allowed to pursue the present action without violating the
principle of [r]es [j]udicata. While defendant in Civil Case No. 17939 was Limpan
Investment Corporation, the doctrine of res judicata still applies because the judgment
in said case (C.C. No. 17939) is conclusive between the parties and their successors-
in-interest (Vda. de Buncio vs. Estate of the late Anita de Leon).The herein defendant
is the successor-in-interest of Limpan Investment Corporation as shown by the Deed
of Assignment Exchange executed on June 13, 1990.
WHEREFORE, defendants motion for reconsideration is hereby granted. The order
dated February 4, 1994 is vacated and set aside.
This case is hereby dismissed. No pronouncement as to costs.
SO ORDERED.[5]
Factual Antecedents
Pursuant to Sangguniang Bayan Resolution No. 93-95, Series of 1993,[6] the
Municipality of Paraaque filed on September 20, 1993, a Complaint for
expropriation[7] against Private Respondent V.M. Realty Corporation over two parcels
of land (Lots 2-A-2 and 2-B-1 of Subdivision Plan Psd-17917), with a combined area
of about 10,000 square meters, located at Wakas, San Dionisio, Paraaque, Metro
Manila, and covered by Torrens Certificate of Title No. 48700. Allegedly, the complaint
was filed for the purpose of alleviating the living conditions ofthe underprivileged by
providing homes for the homeless through a socialized housing
project.[8] Parenthetically, it was also for this stated purpose that petitioner, pursuant to
itsSangguniang Bayan Resolution No. 577, Series of 1991,[9] previously made an offer
to enter into a negotiated sale of the property with private respondent, which the latter
did not accept.[10]
Finding the Complaint sufficient in form and substance, the Regional Trial Court
of Makati, Branch 134, issued an Order dated January 10, 1994, [11] giving it due
course. Acting on petitioners motion, said court issued an Order dated February 4,
1994,[12] authorizing petitioner to take possession of the subject property upon deposit
with its clerk of court of an amount equivalent to 15 percent of its fair market value
based on its current tax declaration.
On February 21, 1994, private respondent filed its Answer containing affirmative
defenses and a counterclaim,[13] alleging in the main that (a) the complaint failed to
state a cause of action because it was filed pursuant to a resolution and not to an
ordinance as required by RA 7160 (the Local Government Code); and (b) the cause of
action, if any, was barred by a prior judgment or res judicata. On private respondents
motion, its Answer was treated as a motion to dismiss. [14] On March 24,
1994,[15] petitioner filed its opposition, stressing that the trial courts Order dated
February 4, 1994 was in accord with Section 19 of RA 7160, and that the principle
of res judicata was not applicable.
Thereafter, the trial court issued its August 9, 1994 Resolution[16] nullifying its
February 4, 1994 Order and dismissing the case. Petitioners motions for
reconsideration and transfer of venue were denied by the trial court in a Resolution
dated December 2, 1994.[17] Petitioner then appealed to Respondent Court, raising the
following issues:
1. Whether or not the Resolution of the Paraaque Municipal Council No.
93-95, Series of 1993 is a substantial compliance of the statutory
requirement of Section 19, R.A. 7180 [sic] in the exercise of the
power of eminent domain by the plaintiff-appellant.
2. Whether or not the complaint in this case states no cause of action.
 3. Whether or not the strict adherence to the literal observance to the rule
of procedure resulted in technicality standing in the way of
substantial justice.
4. Whether or not the principle of res judicata is applicable to the present case.[18]
As previously mentioned, the Court of Appeals affirmed in toto the trial courts
Decision. Respondent Court, in its assailed Resolution promulgated on January 8,
[19]
1997, denied petitioners Motion for Reconsideration for lack of merit.
Hence, this appeal.[20]
The Issues
Before this Court, petitioner posits two issues, viz.:
1. A resolution duly approved by the municipal council has the same force and effect
of an ordinance and will not deprive an expropriation case of a valid cause of action.
2. The principle of res judicata as a ground for dismissal of case is not applicable
when public interest is primarily involved.[21]
The Courts Ruling
The petition is not meritorious.
First Issue:
Resolution Different from an Ordinance
Petitioner contends that a resolution approved by the municipal council for the
purpose of initiating an expropriation case substantially complies with the
requirements of the law[22]because the terms ordinance and resolution are
synonymous for the purpose of bestowing authority [on] the local government unit
through its chief executive to initiate the expropriation proceedings in court in the
exercise of the power of eminent domain.[23] Petitioner seeks to bolster this contention
by citing Article 36, Rule VI of the Rules and Regulations Implementing the Local
Government Code, which provides: If the LGU fails to acquire a private property for
public use, purpose, or welfare through purchase, the LGU may expropriate said
property through a resolution of the Sanggunian authorizing its chief executive to
initiate expropriation proceedings.[24] (Italics supplied.)
The Court disagrees. The power of eminent domain is lodged in the legislative
branch of government, which may delegate the exercise thereof to LGUs, other public
entities and public utilities.[25] An LGU may therefore exercise the power to expropriate
private property only when authorized by Congress and subject to the latters control
and restraints, imposed through the law conferring the power or in other
legislations.[26] In this case, Section 19 of RA 7160, which delegates to LGUs the
power of eminent domain, also lays down the parameters for its exercise. It provides
as follows:
Section 19. Eminent Domain. A local government unit may, through its chief executive
and acting pursuant to an ordinance, exercise the power of eminent domain for public
use, or purpose, or welfare for the benefit of the poor and the landless, upon payment
of just compensation, pursuant to the provisions of the Constitution and pertinent
laws: Provided, however, That the power of eminent domain may not be exercised
unless a valid and definite offer has been previously made to the owner, and such
offer was not accepted: Provided, further, That the local government unit may
immediately take possession of the property upon the filing of the expropriation
proceedings and upon making a deposit with the proper court of at least fifteen
percent (15%) of the fair market value of the property based on the current tax
declaration of the property to be expropriated: Provided, finally, That, the amount to be
paid for the expropriated property shall be determined by the proper court, based on
the fair market value at the time of the taking of the property. (Emphasis supplied)
Thus, the following essential requisites must concur before an LGU can
exercise the power of eminent domain:
1. An ordinance is enacted by the local legislative council authorizing the
local chief executive, in behalf of the LGU, to exercise the power of
eminent domain or pursue expropriation proceedings over a particular
private property.
2. The power of eminent domain is exercised for public use, purpose or
welfare, or for the benefit of the poor and the landless.
3. There is payment of just compensation, as required under Section 9,
Article III of the Constitution, and other pertinent laws.
4. A valid and definite offer has been previously made to the owner of the
property sought to be expropriated, but said offer was not accepted.[27]
In the case at bar, the local chief executive sought to exercise the power of
eminent domain pursuant to a resolution of the municipal council. Thus, there was no
compliance with the first requisite that the mayor be authorized through an
ordinance. Petitioner cites Camarines Sur vs. Court of Appeals[28] to show that a
resolution may suffice to support the exercise of eminent domain by an LGU. [29] This
case, however, is not in point because the applicable law at that time was BP
337,[30] the previous Local Government Code, which had provided that a mere
resolution would enable an LGU to exercise eminent domain. In contrast, RA
7160,[31] the present Local Government Code which was already in force when the
Complaint for expropriation was filed, explicitly required an ordinance for this purpose.
We are not convinced by petitioners insistence that the terms resolution and
ordinance are synonymous. A municipal ordinance is different from a resolution. An
ordinance is a law, but a resolution is merely a declaration of the sentiment or opinion
of a lawmaking body on a specific matter.[32] An ordinance possesses a general and
permanent character, but a resolution is temporary in nature. Additionally, the two are
enacted differently -- a third reading is necessary for an ordinance, but not for a
resolution, unless decided otherwise by a majority of all theSanggunian members.[33]
If Congress intended to allow LGUs to exercise eminent domain through a mere
resolution, it would have simply adopted the language of the previous Local
Government Code. But Congress did not. In a clear divergence from the previous
Local Government Code, Section 19 of RA 7160 categorically requires that the local
chief executive act pursuant to an ordinance.Indeed, [l]egislative intent is determined
principally from the language of a statute. Where the language of a statute is clear and
unambiguous, the law is applied according to its express terms, and interpretation
would be resorted to only where a literal interpretation would be either impossible or
absurd or would lead to an injustice.[34] In the instant case, there is no reason to depart
from this rule, since the law requiring an ordinance is not at all impossible, absurd, or
unjust.
Moreover, the power of eminent domain necessarily involves a derogation of a
fundamental or private right of the people.[35] Accordingly, the manifest change in the
legislative language -- from resolution under BP 337 to ordinance under RA 7160 --
demands a strict construction. No species of property is held by individuals with
greater tenacity, and is guarded by the Constitution and laws more sedulously, than
the right to the freehold of inhabitants. When the legislature interferes with that right
and, for greater public purposes, appropriates the land of an individual without his
consent, the plain meaning of the law should not be enlarged by doubtful
interpretation.[36]
Petitioner relies on Article 36, Rule VI of the Implementing Rules, which requires
only a resolution to authorize an LGU to exercise eminent domain. This is clearly
misplaced, because Section 19 of RA 7160, the law itself, surely prevails over said
rule which merely seeks to implement it.[37] It is axiomatic that the clear letter of the law
is controlling and cannot be amended by a mere administrative rule issued for its
implementation. Besides, what the discrepancy seems to indicate is a mere oversight
in the wording of the implementing rules, since Article 32, Rule VI thereof, also
requires that, in exercising the power of eminent domain, the chief executive of the
LGU must act pursuant to an ordinance.
In this ruling, the Court does not diminish the policy embodied in Section 2,
Article X of the Constitution, which provides that territorial and political subdivisions
shall enjoy local autonomy. It merely upholds the law as worded in RA 7160. We
stress that an LGU is created by law and all its powers and rights are sourced
therefrom. It has therefore no power to amend or act beyond the authority given and
the limitations imposed on it by law. Strictly speaking, the power of eminent domain
delegated to an LGU is in reality not eminent but inferior domain, since it must
conform to the limits imposed by the delegation, and thus partakes only of a share in
eminent domain.[38] Indeed, the national legislature is still the principal of the local
government units, which cannot defy its will or modify or violate it.[39]
Complaint Does Not State a Cause of Action
In its Brief filed before Respondent Court, petitioner argues that its Sanguniang
Bayan passed an ordinance on October 11, 1994 which reiterated its Resolution No.
93-35, Series of 1993, and ratified all the acts of its mayor regarding the subject
expropriation.[40]
This argument is bereft of merit. In the first place, petitioner merely alleged the
existence of such an ordinance, but it did not present any certified true copy thereof. In
the second place ,petitioner did not raise this point before this Court. In fact, it was
mentioned by private respondent, and only in passing. [41] In any event, this allegation
does not cure the inherent defect of petitioners Complaint for expropriation filed on
September 23, 1993. It is hornbook doctrine that:
x x x in a motion to dismiss based on the ground that the complaint fails to state a
cause of action, the question submitted before the court for determination is the
sufficiency of the allegations in the complaint itself. Whether those allegations are true
or not is beside the point, for their truth is hypothetically admitted by the motion. The
issue rather is: admitting them to be true, may the court render a valid judgment in
accordance with the prayer of the complaint?[42]
The fact that there is no cause of action is evident from the face of the
Complaint for expropriation which was based on a mere resolution. The absence of an
ordinance authorizing the same is equivalent to lack of cause of action. Consequently,
the Court of Appeals committed no reversible error in affirming the trial courts Decision
which dismissed the expropriation suit.
Second Issue:
Eminent Domain Not Barred by Res Judicata
As correctly found by the Court of Appeals [43] and the trial court,[44] all the
requisites for the application of res judicata are present in this case. There is a
previous final judgment on the merits in a prior expropriation case involving identical
interests, subject matter and cause of action, which has been rendered by a court
having jurisdiction over it.
Be that as it may, the Court holds that the principle of res judicata, which finds
application in generally all cases and proceedings,[45] cannot bar the right of the State
or its agent to expropriate private property. The very nature of eminent domain, as an
inherent power of the State, dictates that the right to exercise the power be absolute
and unfettered even by a prior judgment or res judicata. The scope of eminent domain
is plenary and, like police power, can reach every form of property which the State
might need for public use.[46] All separate interests of individuals in property are held of
the government under this tacit agreement or implied reservation. Notwithstanding the
grant to individuals, the eminent domain, the highest and most exact idea of property,
remains in the government, or in the aggregate body of the people in their sovereign
capacity; and they have the right to resume the possession of the property whenever
the public interest requires it.[47] Thus, the State or its authorized agent cannot be
forever barred from exercising said right by reason alone of previous non-compliance
with any legal requirement.
While the principle of res judicata does not denigrate the right of the State to
exercise eminent domain, it does apply to specific issues decided in a previous
case. For example, a final judgment dismissing an expropriation suit on the ground
that there was no prior offer precludes another suit raising the same issue; it cannot,
however, bar the State or its agent from thereafter complying with this requirement, as
prescribed by law, and subsequently exercising its power of eminent domain over the
same property.[48] By the same token, our ruling that petitioner cannot exercise its
delegated power of eminent domain through a mere resolution will not bar it from
reinstituting similar proceedings, once the said legal requirement and, for that
matter, all others are properly complied with. Parenthetically and by parity of
reasoning, the same is also true of the principle of law of the case. In Republic vs De
Knecht,[49] the Court ruled that the power of the State or its agent to exercise eminent
domain is not diminished by the mere fact that a prior final judgment over the property
to be expropriated has become the law of the case as to the parties. The State or its
authorized agent may still subsequently exercise its right to expropriate the same
property, once all legal requirements are complied with. To rule otherwise will not only
improperly diminish the power of eminent domain, but also clearly defeat social
justice.
WHEREFORE, the petition is hereby DENIED without prejudice to petitioners
proper exercise of its power of eminent domain over subject property. Costs against
petitioner.
SO ORDERED.
SECOND DIVISION
G.R. No. 107916 February 20, 1997
PERCIVAL MODAY, ZOTICO MODAY (deceased) and LEONORA
MODAY, petitioners,
vs.
COURT OF APPEALS, JUDGE EVANGELINE S. YUIPCO OF BRANCH 6,
REGIONAL TRIAL COURT, AGUSAN DEL SUR AND MUNICIPALITY OF
BUNAWAN, respondents.
ROMERO, J.:
The main issue presented in this case is whether a municipality may expropriate
private property by virtue of a municipal resolution which was disapproved by the
Sangguniang Panlalawigan. Petitioner seeks the reversal of the Court of Appeals
decision and resolution, promulgated on July 15, 1992 and October 22, 1992
respectively, 1 and a declaration that Municipal Resolution No. 43-89 of the Bunawan
Sangguniang Bayan is null and void.
On July 23, 1989, the Sangguniang Bayan of the Municipality of Bunawan in Agusan
del Sur passed Resolution No. 43-89, "Authorizing the Municipal Mayor to Initiate the
Petition for Expropriation of a One (1) Hectare Portion of Lot No. 6138-Pls-4 Along the
National Highway Owned by Percival Moday for the Site of Bunawan Farmers Center
and Other Government Sports Facilities." 2
In due time, Resolution No. 43-89 was approved by then Municipal Mayor Anuncio C.
Bustillo and transmitted to the Sangguniang Panlalawigan for its approval. On
September 11, 1989, the Sangguniang Panlalawigan disapproved said Resolution and
returned it with the comment that "expropriation is unnecessary considering that there
are still available lots in Bunawan for the establishment of the government center." 3
The Municipality of Bunawan, herein public respondent, subsequently filed a petition
for Eminent Domain against petitioner Percival Moday before the Regional Trial Court
at Prosperidad, Agusan del Sur. 4 The complaint was later amended to include the
registered owners, Percival Moday's parents, Zotico and Leonora Moday, as party
defendants.
On March 6, 1991, public respondent municipality filed a Motion to Take or Enter
Upon the Possession of Subject Matter of This Case stating that it had already
deposited with the municipal treasurer the necessary amount in accordance with
Section 2, Rule 67 of the Revised Rules of Court and that it would be in the
government's best interest for public respondent to be allowed to take possession of
the property.
Despite petitioners' opposition and after a hearing on the merits, the Regional Trial
Court granted respondent municipality's motion to take possession of the land. The
lower court held that the Sangguniang Panlalawigan's failure to declare the resolution
invalid leaves it effective. It added that the duty of the Sangguniang Panlalawigan is
merely to review the ordinances and resolutions passed by the Sangguniang Bayan
under Section 208 (1) of B.P. Blg. 337, old Local Government Code and that the
exercise of eminent domain is not one of the two acts enumerated in Section 19
thereof requiring the approval of the Sangguniang Panlalawigan. 5 The dispositive
portion of the lower court's Order dated July 2, 1991 reads:
WHEREFORE, it appearing that the amount of P632.39 had been
deposited as per Official Receipt No. 5379647 on December 12,
1989 which this Court now determines as the provisional value of
the land, the Motion to Take or Enter Upon the Possession of the
Property filed by petitioner through counsel is hereby GRANTED.
The Sheriff of this Court is ordered to forthwith place the plaintiff
in possession of the property involved.
Let the hearing be set on August 9, 1991 at 8:30 o'clock in the
morning for the purpose of ascertaining the just compensation or
fair market value of the property sought to be taken, with notice to
all the parties concerned.
SO ORDERED. 6
Petitioners' motion for reconsideration was denied by the trial court on October 31,
1991.
Petitioners elevated the case in a petition for certiorari alleging grave abuse of
discretion on the part of the trial court, but the same was dismissed by respondent
appellate court on July 15, 1992. 7 The Court of Appeals held that the public purpose
for the expropriation is clear from Resolution No. 43-89 and that since the
Sangguniang Panlalawigan of Agusan del Sur did not declare Resolution No. 43-89
invalid, expropriation of petitioners' property could proceed.
Respondent appellate court also denied petitioners' motion for reconsideration on
October 22, 1992. 8
Meanwhile, the Municipality of Bunawan had erected three buildings on the subject
property: the Association of Barangay Councils (ABC) Hall, the Municipal Motorpool,
both wooden structures, and the Bunawan Municipal Gymnasium, which is made of
concrete.
In the instant petition for review filed on November 23, 1992, petitioner seeks the
reversal of the decision and resolution of the Court of Appeals and a declaration that
Resolution No. 43-89 of the Municipality of Bunawan is null and void.
On December 8, 1993, the Court issued a temporary restraining order enjoining and
restraining public respondent Judge Evangeline Yuipco from enforcing her July 2,
1991 Order and respondent municipality from using and occupying all the buildings
constructed and from further constructing any building on the land subject of this
petition.9
Acting on petitioners' Omnibus Motion for Enforcement of Restraining Order and for
Contempt, the Court issued a Resolution on March 15, 1995, citing incumbent
municipal mayor Anuncio C. Bustillo for contempt, ordering him to pay the fine and to
demolish the "blocktiendas" which were built in violation of the restraining order. 10
Former Mayor Anuncio C. Bustillo paid the fine and manifested that he lost in the May
8, 1995 election. 11 The incumbent Mayor Leonardo Barrios, filed a Manifestation,
Motion to Resolve "Urgent Motion for Immediate Dissolution of the Temporary
Restraining Order" and Memorandum on June 11, 1996 for the Municipality of
Bunawan. 12
Petitioners contend that the Court of Appeals erred in upholding the legality of the
condemnation proceedings initiated by the municipality. According to petitioners, the
expropriation was politically motivated and Resolution No. 43-89 was correctly
disapproved by the Sangguniang Panlalawigan, there being other municipal properties
available for the purpose. Petitioners also pray that the former Mayor Anuncio C.
Bustillo be ordered to pay damages for insisting on the enforcement of a void
municipal resolution.
The Court of Appeals declared that the Sangguniang Panlalawigan's reason for
disapproving the resolution "could be baseless, because it failed to point out which
and where are those available lots.'" Respondent court also concluded that since the
Sangguniang Panlalawigan did not declare the municipal board's resolution as invalid,
expropriation of petitioners' property could
proceed. 13
The Court finds no merit in the petition and affirms the decision of the Court of
Appeals.
Eminent domain, the power which the Municipality of Bunawan exercised in the instant
case, is a fundamental State power that is inseparable from sovereignty. 14 It is
government's right to appropriate, in the nature of a compulsory sale to the State,
private property for public use or purpose. 15 Inherently possessed by the national
legislature, the power of eminent domain may be validly delegated to local
governments, other public entities and public utilities. 16 For the taking of private
property by the government to be valid, the taking must be for public use and there
must be just compensation. 17
The Municipality of Bunawan's power to exercise the right of eminent domain is not
disputed as it is expressly provided for in Batas Pambansa Blg. 337, the local
Government Code 18 in force at the time expropriation proceedings were initiated.
Section 9 of said law states:
Sec. 9. Eminent Domain. A local government unit may, through
its head and acting pursuant to a resolution of its sanggunian,
exercise the right of eminent domain and institute condemnation
proceedings for public use or purpose.
What petitioners question is the lack of authority of the municipality to exercise this
right since the Sangguniang Panlalawigan disapproved Resolution No. 43-89.
Section 153 of B.P. Blg. 337 provides:
Sec. 153. Sangguniang Panlalawigan Review. (1) Within thirty
days after receiving copies of approved ordinances, resolutions
and executive orders promulgated by the municipal mayor, the
sangguniang panlalawigan shall examine the documents or
transmit them to the provincial attorney, or if there be none, to the
provincial fiscal, who shall examine them promptly and inform the
sangguniang panlalawigan in writing of any defect or impropriety
which he may discover therein and make such comments or
recommendations as shall appear to him proper.
(2) If the sangguniang panlalawigan shall find that any municipal
ordinance, resolution or executive order is beyond the power
conferred upon the sangguniang bayan or the mayor, it shall
declare such ordinance, resolution or executive order invalid in
whole or in part, entering its actions upon the minutes and
advising the proper municipal authorities thereof. The effect of
such an action shall be to annul the ordinance, resolution or
executive order in question in whole or in part. The action of the
sangguniang panlalawigan shall be final.
xxx xxx xxx (Emphasis supplied.)
The Sangguniang Panlalawigan's disapproval of Municipal Resolution No. 43-89 is an
infirm action which does not render said resolution null and void. The law, as
expressed in Section 153 of B.P. Blg. 337, grants the Sangguniang Panlalawigan the
power to declare a municipal resolution invalid on the sole ground that it is beyond the
power of the Sangguniang Bayan or the Mayor to issue. Although pertaining to a
similar provision of law but different factual milieu then obtaining, the Court's
pronouncements in Velazco v. Blas, 19 where we cited significant early jurisprudence,
are applicable to the case at bar.
The only ground upon which a provincial board may declare any
municipal resolution, ordinance, or order invalid is when such
resolution, ordinance, or order is "beyond the powers conferred
upon the council or president making the same." Absolutely no
other ground is recognized by the law. A strictly legal question is
before the provincial board in its consideration of a municipal
resolution, ordinance, or order. The provincial (board's)
disapproval of any resolution, ordinance, or order must be
premised specifically upon the fact that such resolution,
ordinance, or order is outside the scope of the legal powers
conferred by law. If a provincial board passes these limits, it
usurps the legislative function of the municipal council or
president. Such has been the consistent course of executive
authority. 20
Thus, the Sangguniang Panlalawigan was without the authority to disapprove
Municipal Resolution No. 43-89 for the Municipality of Bunawan clearly has the power
to exercise the right of eminent domain and its Sangguniang Bayan the capacity to
promulgate said resolution, pursuant to the earlier-quoted Section 9 of B.P. Blg. 337.
Perforce, it follows that Resolution No. 43-89 is valid and binding and could be used
as lawful authority to petition for the condemnation of petitioners' property.
As regards the accusation of political oppression, it is alleged that Percival Moday
incurred the ire of then Mayor Anuncio C. Bustillo when he refused to support the
latter's candidacy for mayor in previous elections. Petitioners claim that then
incumbent Mayor C. Bustillo used the expropriation to retaliate by expropriating their
land even if there were other properties belonging to the municipality and available for
the purpose. Specifically, they allege that the municipality owns a vacant seven-
hectare property adjacent to petitioners' land, evidenced by a sketch plan. 21
The limitations on the power of eminent domain are that the use must be public,
compensation must be made and due process of law must be
observed. 22 The Supreme Court, taking cognizance of such issues as the adequacy
of compensation, necessity of the taking and the public use character or the purpose
of the taking, 23 has ruled that the necessity of exercising eminent domain must be
genuine and of a public character. 24 Government may not capriciously choose what
private property should be taken.
After a careful study of the records of the case, however, we find no evidentiary
support for petitioners' allegations. The uncertified photocopy of the sketch plan does
not conclusively prove that the municipality does own vacant land adjacent to
petitioners' property suited to the purpose of the expropriation. In the questioned
decision, respondent appellate court similarly held that the pleadings and documents
on record have not pointed out any of respondent municipality's "other available
properties available for the same purpose." 25 The accusations of political reprisal are
likewise unsupported by competent evidence. Consequently, the Court holds that
petitioners' demand that the former municipal mayor be personally liable for damages
is without basis.
WHEREFORE, the instant petition is hereby DENIED. The questioned Decision and
Resolution of the Court of Appeals in the case of "Percival Moday." et al. v.
Municipality of Bunawan, et al." (CA G.R. SP No. 26712) are AFFIRMED. The
Temporary Restraining Order issued by the Court on December 8, 1993 is LIFTED.
SO ORDERED.
FIRST DIVISION
G.R. No. 103125 May 17, 1993
PROVINCE OF CAMARINES SUR, represented by GOV. LUIS R. VILLAFUERTE
and HON. BENJAMIN V. PANGA as Presiding Judge of RTC Branch 33 at Pili,
Camarines Sur, petitioners,
vs.
THE COURT OF APPEALS (THIRD DIVISION), ERNESTO SAN JOAQUIN and
EFREN SAN JOAQUIN,respondents.
QUIASON, J.:
In this appeal by certiorari from the decision of the Court of Appeals in AC-G.R. SP
No. 20551 entitled "Ernesto N. San Joaquin, et al., v. Hon. Benjamin V. Panga, et al.,"
this Court is asked to decide whether the expropriation of agricultural lands by local
government units is subject, to the prior approval of the Secretary of the Agrarian
Reform, as the implementator of the agrarian reform program.
On December 22, 1988, the Sangguniang Panlalawigan of the Province of Camarines
Sur passed Resolution No. 129, Series of 1988, authorizing the Provincial Governor to
purchase or expropriate property contiguous to the provincial capitol site, in order to
establish a pilot farm for non-food and non-traditional agricultural crops and a housing
project for provincial government employees.
The "WHEREAS" clause o:f the Resolution states:
WHEREAS, the province of Camarines Sur has adopted a five-
year Comprehensive Development plan, some of the vital
components of which includes the establishment of model and
pilot farm for non-food and non-traditional agricultural crops, soil
testing and tissue culture laboratory centers, 15 small scale
technology soap making, small scale products of plaster of paris,
marine biological and sea farming research center,and other
progressive feasibility concepts objective of which is to provide
the necessary scientific and technology know-how to farmers and
fishermen in Camarines Sur and to establish a housing project for
provincial government employees;
WHEREAS, the province would need additional land to be
acquired either by purchase or expropriation to implement the
above program component;
WHEREAS, there are contiguous/adjacent properties to be (sic)
present Provincial Capitol Site ideally suitable to establish the
same pilot development center;
WHEREFORE . . . .
Pursuant to the Resolution, the Province of Camarines Sur, through its Governor,
Hon. Luis R.Villafuerte, filed two separate cases for expropriation against Ernesto N.
San Joaquin and Efren N. San Joaquin, docketed as Special Civil Action Nos. P-17-89
and P-19-89 of the Regional Trial Court, Pili, Camarines Sur, presided by the Hon.
Benjamin V. Panga.
Forthwith, the Province of Camarines Sur filed a motion for the issuance of writ of
possession. The San Joaquins failed to appear at the hearing of the motion.
The San Joaquins moved to dismiss the complaints on the ground of inadequacy of
the price offered for their property. In an order dated December 6, 1989, the trial court
denied the motion to dismiss and authorized the Province of Camarines Sur to take
possession of the property upon the deposit with the Clerk of Court of the amount of
P5,714.00, the amount provisionally fixed by the trial court to answer for damages that
private respondents may suffer in the event that the expropriation cases do not
prosper. The trial court issued a writ of possession in an order dated January18, 1990.
The San Joaquins filed a motion for relief from the order, authorizing the Province of
Camarines Sur to take possession of their property and a motion to admit an amended
motion to dismiss. Both motions were denied in the order dated February 1990.
In their petition before the Court of Appeals, the San Joaquins asked: (a) that
Resolution No. 129, Series of 1988 of the Sangguniang Panlalawigan be declared null
and void; (b) that the complaints for expropriation be dismissed; and (c) that the order
dated December 6, 1989 (i) denying the motion to dismiss and (ii) allowing the
Province of Camarines Sur to take possession of the property subject of the
expropriation and the order dated February 26, 1990, denying the motion to admit the
amended motion to dismiss, be set aside. They also asked that an order be issued to
restrain the trial court from enforcing the writ of possession, and thereafter to issue a
writ of injunction.
In its answer to the petition, the Province of Camarines Sur claimed that it has the
authority to initiate the expropriation proceedings under Sections 4 and 7 of Local
Government Code (B.P. Blg. 337) and that the expropriations are for a public purpose.
Asked by the Court of Appeals to give his Comment to the petition, the Solicitor
General stated that under Section 9 of the Local Government Code (B.P. Blg. 337),
there was no need for the approval by the Office of the President of the exercise by
the Sangguniang Panlalawigan of the right of eminent domain. However, the Solicitor
General expressed the view that the Province of Camarines Sur must first secure the
approval of the Department of Agrarian Reform of the plan to expropriate the lands of
petitioners for use as a housing project.
The Court of Appeals set aside the order of the trial court, allowing the Province of
Camarines Sur to take possession of private respondents' lands and the order
denying the admission of the amended motion to dismiss. It also ordered the trial court
to suspend the expropriation proceedings until after the Province of Camarines Sur
shall have submitted the requisite approval of the Department of Agrarian Reform to
convert the classification of the property of the private respondents from agricultural to
non-agricultural land.
Hence this petition.
It must be noted that in the Court of Appeals, the San Joaquins asked for: (i) the
dismissal of the complaints for expropriation on the ground of the inadequacy of the
compensation offered for the property and (ii) the nullification of Resolution No. 129,
Series of 1988 of the Sangguniang Panlalawigan of the Province of Camarines Sur.
The Court of Appeals did not rule on the validity of the questioned resolution; neither
did it dismiss the complaints. However, when the Court of Appeals ordered the
suspension of the proceedings until the Province of Camarines Sur shall have
obtained the authority of the Department of Agrarian Reform to change the
classification of the lands sought to be expropriated from agricultural to non-
agricultural use, it assumed that the resolution is valid and that the expropriation is for
a public purpose or public use.
Modernly, there has been a shift from the literal to a broader interpretation of "public
purpose" or "public use" for which the power of eminent domain may be exercised.
The old concept was that the condemned property must actually be used by the
general public (e.g. roads, bridges, public plazas, etc.) before the taking thereof could
satisfy the constitutional requirement of "public use". Under the new concept, "public
use" means public advantage, convenience or benefit, which tends to contribute to the
general welfare and the prosperity of the whole community, like a resort complex for
tourists or housing project (Heirs of Juancho Ardano v. Reyes, 125 SCRA 220 [1983];
Sumulong v. Guerrero, 154 SC.RA 461 [1987]).
The expropriation of the property authorized by the questioned resolution is for a
public purpose. The establishment of a pilot development center would inure to the
direct benefit and advantage of the people of the Province of Camarines Sur. Once
operational, the center would make available to the community invaluable information
and technology on agriculture, fishery and the cottage industry. Ultimately, the
livelihood of the farmers, fishermen and craftsmen would be enhanced. The housing
project also satisfies the public purpose requirement of the Constitution. As held
in Sumulong v. Guerrero, 154 SCRA 461, "Housing is a basic human need. Shortage
in housing is a matter of state concern since it directly and significantly affects public
health, safety, the environment and in sum the general welfare."
It is the submission of the Province of Camarines Sur that its exercise of the power of
eminent domain cannot be restricted by the provisions of the Comprehensive Agrarian
Reform Law (R.A. No. 6657), particularly Section 65 thereof, which requires the
approval of the Department of Agrarian Reform before a parcel of land can be
reclassified from an agricultural to a non-agricultural land.
The Court of Appeals, following the recommendation of the Solicitor General, held that
the Province of Camarines Sur must comply with the provision of Section 65 of the
Comprehensive Agrarian Reform Law and must first secure the approval of the
Department of Agrarian Reform of the plan to expropriate the lands of the San
Joaquins.
In Heirs of Juancho Ardana v. Reyes, 125 SCRA 220, petitioners raised the issue of
whether the Philippine Tourism Authority can expropriate lands covered by the
"Operation Land Transfer" for use of a tourist resort complex. There was a finding that
of the 282 hectares sought to be expropriated, only an area of 8,970 square meters or
less than one hectare was affected by the land reform program and covered by
emancipation patents issued by the Ministry of Agrarian Reform. While the Court said
that there was "no need under the facts of this petition to rule on whether the public
purpose is superior or inferior to another purpose or engage in a balancing of
competing public interest," it upheld the expropriation after noting that petitioners had
failed to overcome the showing that the taking of 8,970 square meters formed part of
the resort complex. A fair and reasonable reading of the decision is that this Court
viewed the power of expropriation as superior to the power to distribute lands under
the land reform program.
The Solicitor General denigrated the power to expropriate by the Province of
Camarines Sur by stressing the fact that local government units exercise such power
only by delegation. (Comment, pp. 14-15; Rollo, pp. 128-129)
It is true that local government units have no inherent power of eminent domain and
can exercise it only when expressly authorized by the legislature (City of Cincinnati v.
Vester, 28l US 439, 74 L.ed. 950, 50 SCt. 360). It is also true that in delegating the
power to expropriate, the legislature may retain certain control or impose certain
restraints on the exercise thereof by the local governments (Joslin Mfg. Co. v.
Providence, 262 US 668 67 L. ed. 1167, 43 S Ct. 684). While such delegated power
may be a limited authority, it is complete within its limits. Moreover, the limitations on
the exercise of the delegated power must be clearly expressed, either in the law
conferring the power or in other legislations.
Resolution No. 129, Series of 1988, was promulgated pursuant to Section 9 of B.P.
Blg. 337, the Local Government Code, which provides:
A local government unit may, through its head and acting
pursuant to a resolution of its sanggunian exercise the right of
eminent domain and institute condemnation proceedings for
public use or purpose.
Section 9 of B.P. Blg. 337 does not intimate in the least that local government, units
must first secure the approval of the Department of Land Reform for the conversion of
lands from agricultural to non-agricultural use, before they can institute the necessary
expropriation proceedings. Likewise, there is no provision in the Comprehensive
Agrarian Reform Law which expressly subjects the expropriation of agricultural lands
by local government units to the control of the Department of Agrarian Reform. The
closest provision of law that the Court of Appeals could cite to justify the intervention
of the Department of Agrarian Reform in expropriation matters is Section 65 of the
Comprehensive Agrarian Reform Law, which reads:
Sec. 65. Conversion of Lands. After the lapse of five (5) years
from its award, when the land ceases to be economically feasible
and sound for, agricultural purposes, or the locality has become
urbanized and the land will have a greater economic value for
residential, commercial or industrial purposes, the DAR, upon
application of the beneficiary or the landowner, with due notice to
the affected parties, and subject to existing laws, may authorize
the reclassification or conversion of the land and its disposition:
Provided, That the beneficiary shall have fully paid his obligation.
The opening, adverbial phrase of the provision sends signals that it applies to lands
previously placed under the agrarian reform program as it speaks of "the lapse of five
(5) years from its award."
The rules on conversion of agricultural lands found in Section 4 (k) and 5 (1) of
Executive Order No. 129-A, Series of 1987, cannot be the source of the authority of
the Department of Agrarian Reform to determine the suitability of a parcel of
agricultural land for the purpose to which it would be devoted by the expropriating
authority. While those rules vest on the Department of Agrarian Reform the exclusive
authority to approve or disapprove conversions of agricultural lands for residential,
commercial or industrial uses, such authority is limited to the applications for
reclassification submitted by the land owners or tenant beneficiaries.
Statutes conferring the power of eminent domain to political subdivisions cannot be
broadened or constricted by implication (Schulman v. People, 10 N.Y. 2d. 249, 176
N.E. 2d. 817, 219 NYS 2d. 241).
To sustain the Court of Appeals would mean that the local government units can no
longer expropriate agricultural lands needed for the construction of roads, bridges,
schools, hospitals, etc, without first applying for conversion of the use of the lands with
the Department of Agrarian Reform, because all of these projects would naturally
involve a change in the land use. In effect, it would then be the Department of
Agrarian Reform to scrutinize whether the expropriation is for a public purpose or
public use.
Ordinarily, it is the legislative branch of the local government unit that shall determine
whether the use of the property sought to be expropriated shall be public, the same
being an expression of legislative policy. The courts defer to such legislative
determination and will intervene only when a particular undertaking has no real or
substantial relation to the public use (United States Ex Rel Tennessee Valley Authority
v. Welch, 327 US 546, 90 L. ed. 843, 66 S Ct 715; State ex rel Twin City Bldg. and
Invest. Co. v. Houghton, 144 Minn. 1, 174 NW 885, 8 ALR 585).
There is also an ancient rule that restrictive statutes, no matter how broad their terms
are, do not embrace the sovereign unless the sovereign is specially mentioned as
subject thereto (Alliance of Government Workers v. Minister of Labor and
Employment, 124 SCRA 1 [1983]). The Republic of the Philippines, as sovereign, or
its political subdivisions, as holders of delegated sovereign powers, cannot be bound
by provisions of law couched in general term.
The fears of private respondents that they will be paid on the basis of the valuation
declared in the tax declarations of their property, are unfounded. This Court has
declared as unconstitutional the Presidential Decrees fixing the just compensation in
expropriation cases to be the value given to the condemned property either by the
owners or the assessor, whichever was lower ([Export Processing Zone Authority v.
Dulay, 149 SCRA 305 [1987]). As held inMunicipality of Talisay v. Ramirez, 183 SCRA
528 [1990], the rules for determining just compensation are those laid down in Rule 67
of the Rules of Court, which allow private respondents to submit evidence on what
they consider shall be the just compensation for their property.
WHEREFORE, the petition is GRANTED and the questioned decision of the Court of
Appeals is set aside insofar as it (a) nullifies the trial court's order allowing the
Province of Camarines Sur to take possession of private respondents' property; (b)
orders the trial court to suspend the expropriation proceedings; and (c) requires the
Province of Camarines Sur to obtain the approval of the Department of Agrarian
Reform to convert or reclassify private respondents' property from agricultural to non-
agricultural use.
The decision of the Court of Appeals is AFFIRMED insofar as it sets aside the order of
the trial court, denying the amended motion to dismiss of the private respondents.
SO ORDERED.
[G.R. No. 142971. May 7, 2002]
THE CITY OF CEBU, petitioner, vs. SPOUSES APOLONIO and BLASA
DEDAMO, respondents.
DECISION
DAVIDE, JR., C.J.:
In its petition for review on certiorari under Rule 45 of the 1997 Rules of Civil
Procedure, petitioner City of Cebu assails the decision of 11 October 1999 of the
Court of Appeals in CA-G.R. CV No. 59204[1] affirming the judgment of 7 May 1996 of
the Regional Trial Court, Branch 13, Cebu City, in Civil Case No. CEB-14632, a case
for eminent domain, which fixed the valuation of the land subject thereof on the basis
of the recommendation of the commissioners appointed by it.
The material operative facts are not disputed.
On 17 September 1993, petitioner City of Cebu filed in Civil Case No. CEB-
14632 a complaint for eminent domain against respondents spouses Apolonio and
Blasa Dedamo. The petitioner alleged therein that it needed the following parcels of
land of respondents, to wit:
Lot No. 1527
Area----------------------------1,146 square meters
Tax Declaration---------------03472
Title No.-----------------------31833
Market value------------------P240,660.00
Assessed Value---------------P72,200.00
Lot No. 1528
Area--------------------------------------------------------793 square meters
Area sought to be-----------------------------------------478 square meters
expropriated
Tax Declaration-------------------------------------------03450
Title No. ---------------------------------------------------31832
Market value for the whole lot--------------------------P1,666,530.00
Market value of the Area to be expropriated----------P100,380.00
Assessed Value--------------------------------------------P49,960.00
for a public purpose, i.e., for the construction of a public road which shall serve as an
access/relief road of Gorordo Avenue to extend to the General Maxilum Avenue and
the back of Magellan International Hotel Roads in Cebu City. The lots are the most
suitable site for the purpose. The total area sought to be expropriated is 1,624 square
meters with an assessed value of P1,786,400. Petitioner deposited with the Philippine
National Bank the amount of P51,156 representing 15% of the fair market value of the
property to enable the petitioner to take immediate possession of the property
pursuant to Section 19 of R.A. No. 7160.[2]
Respondents, filed a motion to dismiss the complaint because the purpose for
which their property was to be expropriated was not for a public purpose but for
benefit of a single private entity, the Cebu Holdings, Inc. Petitioner could simply buy
directly from them the property at its fair market value if it wanted to, just like what it
did with the neighboring lots. Besides, the price offered was very low in light of the
consideration of P20,000 per square meter, more or less, which petitioner paid to the
neighboring lots. Finally, respondents alleged that they have no other land in Cebu
City.
A pre-trial was thereafter had.
On 23 August 1994, petitioner filed a motion for the issuance of a writ of
possession pursuant to Section 19 of R.A. No. 7160. The motion was granted by the
trial court on 21 September 1994.[3]
On 14 December 1994, the parties executed and submitted to the trial court an
Agreement[4] wherein they declared that they have partially settled the case and in
consideration thereof they agreed:
1. That the SECOND PARTY hereby conforms to the intention to [sic] the
FIRST PARTY in expropriating their parcels of land in the above-cited
case as for public purpose and for the benefit of the general public;
2. That the SECOND PARTY agrees to part with the ownership of the
subject parcels of land in favor of the FIRST PARTY provided the
latter will pay just compensation for the same in the amount
determined by the court after due notice and hearing;
3. That in the meantime the SECOND PARTY agrees to receive the
amount of ONE MILLION SEVEN HUNDRED EIGHTY SIX
THOUSAND FOUR HUNDRED PESOS (1,786,400.00) as provisional
payment for the subject parcels of land, without prejudice to the final
valuation as maybe determined by the court;
4. That the FIRST PARTY in the light of the issuance of the Writ of
Possession Order dated September 21, 1994 issued by the
Honorable Court, agreed to take possession over that portion of the
lot sought to be expropriated where the house of the SECOND
PARTY was located only after fifteen (15) days upon the receipt of the
SECOND PARTY of the amount of P1,786,400.00;
5. That the SECOND PARTY upon receipt of the aforesaid provisional
amount, shall turn over to the FIRST PARTY the title of the lot and
within the lapse of the fifteen (15) days grace period will voluntarily
demolish their house and the other structure that may be located
thereon at their own expense;
6. That the FIRST PARTY and the SECOND PARTY jointly petition the
Honorable Court to render judgment in said Civil Case No. CEB-
14632 in accordance with this AGREEMENT;
7. That the judgment sought to be rendered under this agreement shall be
followed by a supplemental judgment fixing the just compensation for
the property of the SECOND PARTY after the Commissioners
appointed by this Honorable Court to determine the same shall have
rendered their report and approved by the court.
Pursuant to said agreement, the trial court appointed three commissioners to
determine the just compensation of the lots sought to be expropriated. The
commissioners were Palermo M. Lugo, who was nominated by petitioner and who was
designated as Chairman; Alfredo Cisneros, who was nominated by respondents; and
Herbert E. Buot, who was designated by the trial court. The parties agreed to their
appointment.
 Thereafter, the commissioners submitted their report, which contained their
respective assessments of and recommendation as to the valuation of the property.
On the basis of the commissioners report and after due deliberation thereon, the
trial court rendered its decision on 7 May 1996,[5] the decretal portion of which reads:
WHEREFORE, in view of the foregoing, judgment is hereby rendered in accordance
with the report of the commissioners.
Plaintiff is directed to pay Spouses Apolonio S. Dedamo and Blasa Dedamo the sum
of pesos: TWENTY FOUR MILLION EIGHT HUNDRED SIXTY-FIVE THOUSAND
AND NINE HUNDRED THIRTY (P24,865.930.00) representing the compensation
mentioned in the Complaint.
Plaintiff and defendants are directed to pay the following commissioners fee;
1. To Palermo Lugo - P21,000.00
2. To Herbert Buot - P19,000.00
3. To Alfredo Cisneros - P19,000.00
Without pronouncement as to cost.
SO ORDERED.
Petitioner filed a motion for reconsideration on the ground that the
commissioners report was inaccurate since it included an area which was not subject
to expropriation. More specifically, it contended that Lot No. 1528 contains 793 square
meters but the actual area to be expropriated is only 478 square meters. The
remaining 315 square meters is the subject of a separate expropriation proceeding in
Civil Case No. CEB-8348, then pending before Branch 9 of the Regional Trial Court of
Cebu City.
On 16 August 1996, the commissioners submitted an amended assessment for
the 478 square meters of Lot No. 1528 and fixed it at P12,824.10 per square meter, or
in the amount of P20,826,339.50. The assessment was approved as the just
compensation thereof by the trial court in its Order of 27 December
1996.[6] Accordingly, the dispositive portion of the decision was amended to reflect the
new valuation.
Petitioner elevated the case to the Court of Appeals, which docketed the case
as CA-G.R. CV No. 59204. Petitioner alleged that the lower court erred in fixing the
amount of just compensation atP20,826,339.50. The just compensation should be
based on the prevailing market price of the property at the commencement of the
expropriation proceedings.
The petitioner did not convince the Court of Appeals. In its decision of 11
October 1999,[7] the Court of Appeals affirmed in toto the decision of the trial court.
Still unsatisfied, petitioner filed with us the petition for review in the case at
bar. It raises the sole issue of whether just compensation should be determined as of
the date of the filing of the complaint. It asserts that it should be, which in this case
should be 17 September 1993 and not at the time the property was actually taken in
1994, pursuant to the decision in National Power Corporation vs. Court of Appeals.[8]
In their Comment, respondents maintain that the Court of Appeals did not err in
affirming the decision of the trial court because (1) the trial court decided the case on
the basis of the agreement of the parties that just compensation shall be fixed by
commissioners appointed by the court; (2) petitioner did not interpose any serious
objection to the commissioners report of 12 August 1996 fixing the just compensation
of the 1,624-square meter lot at P20,826,339.50; hence, it was estopped from
attacking the report on which the decision was based; and (3) the determined just
compensation fixed is even lower than the actual value of the property at the time of
the actual taking in 1994.
Eminent domain is a fundamental State power that is inseparable from
sovereignty. It is the Governments right to appropriate, in the nature of a compulsory
sale to the State, private property for public use or purpose. [9] However, the
Government must pay the owner thereof just compensation as consideration therefor.
In the case at bar, the applicable law as to the point of reckoning for the
determination of just compensation is Section 19 of R.A. No. 7160, which expressly
provides that just compensation shall be determined as of the time of actual
taking. The Section reads as follows:
SECTION 19. Eminent Domain. -- A local government unit may, through its chief
executive and acting pursuant to an ordinance, exercise the power of eminent domain
for public use, or purpose or welfare for the benefit of the poor and the landless, upon
payment of just compensation, pursuant to the provisions of the Constitution and
pertinent laws: Provided, however, That the power of eminent domain may not be
exercised unless a valid and definite offer has been previously made to the owner,
and such offer was not accepted: Provided, further, That the local government unit
may immediately take possession of the property upon the filing of the expropriation
proceedings and upon making a deposit with the proper court of at least fifteen
percent (15%) of the fair market value of the property based on the current tax
declaration of the property to be expropriated: Provided finally, That, the amount to be
paid for the expropriated property shall be determined by the proper court, based on
the fair market value at the time of the taking of the property.
The petitioner has misread our ruling in The National Power Corp. vs. Court of
Appeals. We did not categorically rule in that case that just compensation should be
determined as of the filing of the complaint. We explicitly stated therein that although
the general rule in determining just compensation in eminent domain is the value of
the property as of the date of the filing of the complaint, the rule admits of an
exception: where this Court fixed the value of the property as of the date it was taken
and not at the date of the commencement of the expropriation proceedings.
Also, the trial court followed the then governing procedural law on the matter,
which was Section 5 of Rule 67 of the Rules of Court, which provided as follows:
SEC. 5. Ascertainment of compensation. -- Upon the entry of the order of
condemnation, the court shall appoint not more than three (3) competent and
disinterested persons as commissioners to ascertain and report to the court the just
compensation for the property sought to be taken. The order of appointment shall
designate the time and place of the first session of the hearing to be held by the
commissioners and specify the time within which their report is to be filed with the
court.
 More than anything else, the parties, by a solemn document freely and
voluntarily agreed upon by them, agreed to be bound by the report of the commission
and approved by the trial court. The agreement is a contract between the parties. It
has the force of law between them and should be complied with in good faith. Article
1159 and 1315 of the Civil Code explicitly provides:
Art. 1159. Obligations arising from contracts have the force of law between the
contracting parties and should be complied with in good faith.
Art. 1315. Contracts are perfected by mere consent, and from that moment the parties
are bound not only to the fulfillment of what has been expressly stipulated but also to
all the consequences which, according to their nature, may be in keeping with good
faith, usage and law.
Furthermore, during the hearing on 22 November 1996, petitioner did not
interpose a serious objection. It is therefore too late for petitioner to question the
valuation now without violating the principle of equitable estoppel. Estoppel in
pais arises when one, by his acts, representations or admissions, or by his own
silence when he ought to speak out, intentionally or through culpable negligence,
induces another to believe certain facts to exist and such other rightfully relies and
acts on such belief, so that he will be prejudiced if the former is permitted to deny the
existence of such facts.[12] Records show that petitioner consented to conform with the
valuation recommended by the commissioners. It cannot detract from its agreement
now and assail correctness of the commissioners assessment.
Finally, while Section 4, Rule 67 of the Rules of Court provides that just
compensation shall be determined at the time of the filing of the complaint for
expropriation, such law cannot prevail over R.A. 7160, which is a substantive law. [14]
WHEREFORE, finding no reversible error in the assailed judgment of the Court
of Appeals in CA-G.R. CV No. 59204, the petition in this case is hereby DENIED.
No pronouncement as to costs.
SO ORDERED.
SECOND DIVISION
[G.R. No. 152230. August 9, 2005]
JESUS IS LORD CHRISTIAN SCHOOL FOUNDATION, INC., petitioner, vs.
MUNICIPALITY (now CITY) OF PASIG, METRO MANILA, respondent.
DECISION
CALLEJO, SR., J.:
Before us is a petition for review of the Decision[1] of the Court of Appeals (CA)
in CA-G.R. CV No. 59050, and its Resolution dated February 18, 2002, denying the
motion for reconsideration thereof. The assailed decision affirmed the order of the
Regional Trial Court (RTC) of Pasig, Branch 160, declaring the respondent
Municipality (now City) of Pasig as having the right to expropriate and take possession
of the subject property.
The Antecedents
The Municipality of Pasig needed an access road from E. R. Santos Street, a
municipal road near the Pasig Public Market, to Barangay Sto. Tomas Bukid, Pasig,
where 60 to 70 houses, mostly made of light materials, were located. The road had to
be at least three meters in width, as required by the Fire Code, so that fire trucks could
pass through in case of conflagration.[2] Likewise, the residents in the area needed the
road for water and electrical outlets.[3] The municipality then decided to acquire 51
square meters out of the 1,791-square meter property of Lorenzo Ching Cuanco,
Victor Ching Cuanco and Ernesto Ching Cuanco Kho covered by Transfer Certificate
of Title (TCT) No. PT-66585,[4] which is abutting E. R. Santos Street.
On April 19, 1993, the Sangguniang Bayan of Pasig approved an
Ordinance[5] authorizing the municipal mayor to initiate expropriation proceedings to
acquire the said property and appropriate the fund therefor. The ordinance stated that
the property owners were notified of the municipalitys intent to purchase the property
for public use as an access road but they rejected the offer.
On July 21, 1993, the municipality filed a complaint, amended on August 6,
1993, against the Ching Cuancos for the expropriation of the property under Section
19 of Republic Act (R.A.) No. 7160, otherwise known as the Local Government Code.
The plaintiff alleged therein that it notified the defendants, by letter, of its intention to
construct an access road on a portion of the property but they refused to sell the same
portion. The plaintiff appended to the complaint a photocopy of the letter addressed to
defendant Lorenzo Ching Cuanco.[6]
The plaintiff deposited with the RTC 15% of the market value of the property
based on the latest tax declaration covering the property. On plaintiffs motion, the
RTC issued a writ of possession over the property sought to be expropriated. On
November 26, 1993, the plaintiff caused the annotation of a notice of lis pendens at
the dorsal portion of TCT No. PT-92579 under the name of the Jesus Is Lord Christian
School Foundation, Incorporated (JILCSFI) which had purchased the
property.[7] Thereafter, the plaintiff constructed therein a cemented road with a width of
three meters; the road was called Damayan Street.
In their answer,[8] the defendants claimed that, as early as February 1993, they
had sold the said property to JILCSFI as evidenced by a deed of sale [9] bearing the
signature of defendant Ernesto Ching Cuanco Kho and his wife.
When apprised about the complaint, JILCSFI filed a motion for leave to
intervene as defendant-in-intervention, which motion the RTC granted on August 26,
1994.[10]
In its answer-in-intervention, JILCSFI averred, by way of special and affirmative
defenses, that the plaintiffs exercise of eminent domain was only for a particular class
and not for the benefit of the poor and the landless. It alleged that the property sought
to be expropriated is not the best portion for the road and the least burdensome to it.
The intervenor filed a crossclaim against its co-defendants for reimbursement in case
the subject property is expropriated.[11] In its amended answer, JILCSFI also averred
that it has been denied the use and enjoyment of its property because the road was
constructed in the middle portion and that the plaintiff was not the real party-in-
interest. The intervenor, likewise, interposed counterclaims against the plaintiff for
moral damages and attorneys fees.[12]
 During trial, Rolando Togonon, the plaintiffs messenger, testified on direct
examination that on February 23, 1993, he served a letter of Engr. Jose Reyes, the
Technical Assistant to the Mayor on Infrastructure, to Lorenzo Ching Cuanco at his
store at No. 18 Alkalde Jose Street, Kapasigan, Pasig. A lady received the same and
brought it inside the store. When she returned the letter to him, it already bore the
signature of Luz Bernarte. He identified a photocopy of the letter as similar to the one
he served at the store. On cross-examination, he admitted that he never met Luz
Bernarte. [13]
Edgardo del Rosario, a resident of Sto. Tomas Bukid since 1982 declared that
he would pass through a wooden bridge to go to E. R. Santos Street. At times, the
bridge would be slippery and many had met accidents while walking along the bridge.
Because of this, they requested Mayor Vicente Eusebio to construct a road therein.
He attested that after the construction of the cemented access road, the residents had
water and electricity.[14]
Augusto Paz of the City Engineers Office testified that, sometime in 1992, the
plaintiff constructed a road perpendicular from E. R. Santos Street to Sto. Tomas
Bukid; he was the Project Engineer for the said undertaking. Before the construction of
the road, the lot was raw and they had to put filling materials so that vehicles could
use it. According to him, the length of the road which they constructed was 70 meters
long and 3 meters wide so that a fire truck could pass through. He averred that there
is no other road through which a fire truck could pass to go to Sto. Tomas Bukid.[15]
Manuel Tembrevilla, the Fire Marshall, averred that he had seen the new road,
that is, Damayan Street, and found that a fire truck could pass through it. He
estimated the houses in the area to be around 300 to 400. Tembrevilla also stated that
Damayan Street is the only road in the area.[16]
Finally, Bonifacio Maceda, Jr., Tax Mapper IV, testified that, according to their
records, JILCSFI became the owner of the property only on January 13, 1994.[17]
The plaintiff offered in evidence a photocopy of the letter of Engr. Jose Reyes
addressed to Lorenzo Ching Cuanco to prove that the plaintiff made a definite and
valid offer to acquire the property to the co-owners. However, the RTC rejected the
same letter for being a mere photocopy.[18]
For the defendant-intervenor, Normita del Rosario, owner of the property
located across the subject property, testified that there are other roads leading to E. R.
Santos Street. She asserted that only about ten houses of the urban poor are using
the new road because the other residents are using an alternative right-of-way. She
averred that she did not actually occupy her property; but there were times that she
visited it.[19]
Danilo Caballero averred that he had been a resident of Sto. Tomas Bukid for
seven years. From his house, he could use three streets to go to E. R. Santos Street,
namely, Catalina Street, Damayan Street and Bagong Taon Street. On cross-
examination, he admitted that no vehicle could enter Sto. Tomas Bukid except through
the newly constructed Damayan Street.[20]
Eduardo Villanueva, Chairman of the Board of Trustees and President of
JILCSFI, testified that the parcel of land was purchased for purposes of constructing a
school building and a church as worship center. He averred that the realization of
these projects was delayed due to the passing of the ordinance for expropriation.[21]
The intervenor adduced documentary evidence that on February 27, 1993,
Lorenzo Ching Cuanco and the co-owners agreed to sell their property covered by
TCT No. PT-66585 forP1,719,000.00.[22] It paid a down payment of P1,000,000.00 for
the property. After payment of the total purchase price, the Ching Cuancos executed a
Deed of Absolute Sale[23] over the property on December 13, 1993. On December 21,
1993, TCT No. PT-92579 was issued in the name of JILCSFI.[24] It declared the
property for taxation purposes under its name.[25]
On September 3, 1997, the RTC issued an Order in favor of the plaintiff, the
dispositive portion of which reads:
WHEREFORE, in view of the foregoing and in accordance with Section 4, Rule 67 of
the Revised Rules of Court, the Court Resolves to DECLARE the plaintiff as having a
lawful right to take the property in question for purposes for which the same is
expropriated.
The plaintiff and intervenor are hereby directed to submit at least two (2) names of
their recommended commissioners for the determination of just compensation within
ten (10) days from receipt hereof.
SO ORDERED.[26]
The RTC held that, as gleaned from the declaration in Ordinance No. 21, there
was substantial compliance with the definite and valid offer requirement of Section 19
of R.A. No. 7160, and that the expropriated portion is the most convenient access to
the interior of Sto. Tomas Bukid.
Dissatisfied, JILCSFI elevated the case to the CA on the following assignment
of errors:
First Assignment of Error
THE LOWER COURT SERIOUS[LY] ERRED WHEN IT RULED THAT PLAINTIFF-
APPELLEE SUBSTANTIALLY COMPLIED WITH THE LAW WHEN IT
EXPROPRIATED JILS PROPERTY TO BE USED AS A RIGHT OF WAY.
Second Assignment of Error
THE LOWER COURT ERRED IN DISREGARDING JILS EVIDENCE PROVING
THAT THERE WAS NO PUBLIC NECESSITY TO WARRANT THE EXPROPRIATION
OF THE SUBJECT PROPERTY.[27]
The Court of Appeals Decision
In a Decision dated March 13, 2001, the CA affirmed the order of the
RTC.[28] The CA agreed with the trial court that the plaintiff substantially complied with
Section 19 of R.A. No. 7160, particularly the requirement that a valid and definite offer
must be made to the owner. The CA declared that the letter of Engr. Reyes, inviting
Lorenzo Ching Cuanco to a conference to discuss with him the road project and the
price of the lot, was a substantial compliance with the valid and definite offer
requirement under said Section 19. In addition, the CA noted that there was also
constructive notice to the defendants of the expropriation proceedings since a notice
of lis pendens was annotated at the dorsal portion of TCT No. PT-92579 on November
26, 1993.[29]
Finally, the CA upheld the public necessity for the subject property based on the
findings of the trial court that the portion of the property sought to be expropriated
appears to be, not only the most convenient access to the interior of Sto. Tomas
Bukid, but also an easy path for vehicles entering the area, particularly fire trucks.
Moreover, the CA took into consideration the provision of Article 33 of the Rules and
Regulations Implementing the Local Government Code, which regards the
construction or extension of roads, streets, sidewalks as public use, purpose or
welfare.[30]
On April 6, 2001, JILCSFI filed a motion for reconsideration of the said decision
alleging that the CA erred in relying on the photocopy of Engr. Reyes letter to Lorenzo
Ching Cuanco because the same was not admitted in evidence by the trial court for
being a mere photocopy. It also contended that the CA erred in concluding that
constructive notice of the expropriation proceeding, in the form of annotation of the
notice of lis pendens, could be considered as a substantial compliance with the
requirement under Section 19 of the Local Government Code for a valid and definite
offer. JILCSFI also averred that no inspection was ever ordered by the trial court to be
conducted on the property, and, if there was one, it had the right to be present thereat
since an inspection is considered to be part of the trial of the case.[31]
The CA denied the motion for reconsideration for lack of merit. It held that it was
not precluded from considering the photocopy[32] of the letter, notwithstanding that the
same was excluded by the trial court, since the fact of its existence was duly
established by corroborative evidence. This corroborative evidence consisted of the
testimony of the plaintiffs messenger that he personally served the letter to Lorenzo
Ching Cuanco, and Municipal Ordinance No. 21 which expressly stated that the
property owners were already notified of the expropriation proceeding. The CA noted
that JILCSFI failed to adduce controverting evidence, thus the presumption of
regularity was not overcome.[33]
The Present Petition
In this petition, petitioner JILCSFI raises the following issues: (1) whether the
respondent complied with the requirement, under Section 19 of the Local Government
Code, of a valid and definite offer to acquire the property prior to the filing of the
complaint; (2) whether its property which is already intended to be used for public
purposes may still be expropriated by the respondent; and (3) whether the requisites
for an easement for right-of-way under Articles 649 to 657 of the New Civil Code may
be dispensed with.
The petitioner stresses that the law explicitly requires that a valid and definite
offer be made to the owner of the property and that such offer was not accepted. It
argues that, in this case, there was no evidence to show that such offer has been
made either to the previous owner or the petitioner, the present owner. The petitioner
contends that the photocopy of the letter of Engr. Reyes, notifying Lorenzo Ching
Cuanco of the respondents intention to construct a road on its property, cannot be
considered because the trial court did not admit it in evidence. And assuming that
such letter is admissible in evidence, it would not prove that the offer has been made
to the previous owner because mere notice of intent to purchase is not equivalent to
an offer to purchase. The petitioner further argues that the offer should be made to the
proper party, that is, to the owner of the property. It noted that the records in this case
show that as of February 1993, it was already the owner of the property. Assuming,
therefore, that there was an offer to purchase the property, the same should have
been addressed to the petitioner, as present owner.[34]
The petitioner maintains that the power of eminent domain must be strictly
construed since its exercise is necessarily in derogation of the right to property
ownership. All the requirements of the enabling law must, therefore, be strictly
complied with. Compliance with such requirements cannot be presumed but must be
proved by the local government exercising the power. The petitioner adds that the
local government should, likewise, comply with the requirements for an easement of
right-of-way; hence, the road must be established at a point least prejudicial to the
owner of the property. Finally, the petitioner argues that, if the property is already
devoted to or intended to be devoted to another public use, its expropriation should
not be allowed.[35]
For its part, the respondent avers that the CA already squarely resolved the
issues raised in this petition, and the petitioner failed to show valid and compelling
reason to reverse the CAs findings. Moreover, it is not the function of the Supreme
Court to weigh the evidence on factual issues all over again. [36] The respondent
contends that the Ching Cuancos were deemed to have admitted that an offer to
purchase has been made and that they refused to accept such offer considering their
failure to specifically deny such allegation in the complaint. In light of such admission,
the exclusion of the photocopy of the letter of Engr. Reyes, therefore, is no longer
significant.[37]
The Ruling of the Court
The petition is meritorious.
At the outset, it must be stressed that only questions of law may be raised by
the parties and passed upon by the Supreme Court in petitions for review
on certiorari.[38] Findings of fact of the CA, affirming those of the trial court, are final
and conclusive and may not be reviewed on appeal.[39]
Nonetheless, where it is shown that the conclusion is a finding grounded on
speculations, surmises or conjectures or where the judgment is based on
misapprehension of facts, the Supreme Court may reexamine the evidence on
record.[40]
Eminent Domain: Nature and Scope
The right of eminent domain is usually understood to be an ultimate right of the
sovereign power to appropriate any property within its territorial sovereignty for a
public purpose. The nature and scope of such power has been comprehensively
described as follows:
It is an indispensable attribute of sovereignty; a power grounded in the primary duty of
government to serve the common need and advance the general welfare. Thus, the
right of eminent domain appertains to every independent government without the
necessity for constitutional recognition. The provisions found in modern constitutions
of civilized countries relating to the taking of property for the public use do not by
implication grant the power to the government, but limit the power which would,
otherwise, be without limit. Thus, our own Constitution provides that [p]rivate property
shall not be taken for public use without just compensation. Furthermore, the due
process and equal protection clauses act as additional safeguards against the
arbitrary exercise of this governmental power.[41]
Strict Construction and Burden of Proof
The exercise of the right of eminent domain, whether directly by the State or by
its authorized agents, is necessarily in derogation of private rights. [42] It is one of the
harshest proceedings known to the law. Consequently, when the sovereign delegates
the power to a political unit or agency, a strict construction will be given against the
agency asserting the power.[43] The authority to condemn is to be strictly construed in
favor of the owner and against the condemnor.[44] When the power is granted, the
extent to which it may be exercised is limited to the express terms or clear implication
of the statute in which the grant is contained.[45]
Corollarily, the respondent, which is the condemnor, has the burden of proving
all the essentials necessary to show the right of condemnation. [46] It has the burden of
proof to establish that it has complied with all the requirements provided by law for the
valid exercise of the power of eminent domain.
The grant of the power of eminent domain to local government units is grounded
on Section 19 of R.A. No. 7160 which reads:
SEC. 19. Eminent Domain. A local government unit may, through its chief executive
and acting pursuant to an ordinance, exercise the power of eminent domain for public
use, or purpose, or welfare for the benefit of the poor and the landless, upon payment
of just compensation, pursuant to the provisions of the Constitution and pertinent
laws; Provided, however, That the power of eminent domain may not be exercised
unless a valid and definite offer has been previously made to the owner, and such
offer was not accepted: Provided, further, That the local government unit may
immediately take possession of the property upon the filing of the expropriation
proceedings and upon making a deposit with the proper court of at least fifteen
percent (15%) of the fair market value of the property based on the current tax
declaration of the property to be expropriated: Provided, finally, That the amount to be
paid for the expropriated property shall be determined by the proper court based on
the fair market value at the time of the taking of the property.
The Court declared that the following requisites for the valid exercise of the
power of eminent domain by a local government unit must be complied with:
1. An ordinance is enacted by the local legislative council authorizing the local
chief executive, in behalf of the local government unit, to exercise the
power of eminent domain or pursue expropriation proceedings over a
particular private property.
2. The power of eminent domain is exercised for public use, purpose or welfare,
or for the benefit of the poor and the landless.
3. There is payment of just compensation, as required under Section 9, Article
III of the Constitution, and other pertinent laws.
4. A valid and definite offer has been previously made to the owner of the
property sought to be expropriated, but said offer was not accepted. [47]
Valid and Definite Offer
Article 35 of the Rules and Regulations Implementing the Local Government
Code provides:
ARTICLE 35. Offer to Buy and Contract of Sale. (a) The offer to buy private property
for public use or purpose shall be in writing. It shall specify the property sought to be
acquired, the reasons for its acquisition, and the price offered.
(b) If the owner or owners accept the offer in its entirety, a contract of sale shall be
executed and payment forthwith made.
(c) If the owner or owners are willing to sell their property but at a price higher than
that offered to them, the local chief executive shall call them to a conference for the
purpose of reaching an agreement on the selling price. The chairman of the
appropriation or finance committee of the sanggunian, or in his absence, any member
of the sanggunian duly chosen as its representative, shall participate in the
conference. When an agreement is reached by the parties, a contract of sale shall be
drawn and executed.
(d) The contract of sale shall be supported by the following documents:
(1) Resolution of the sanggunian authorizing the local chief executive to enter into a
contract of sale. The resolution shall specify the terms and conditions to be embodied
in the contract;
(2) Ordinance appropriating the amount specified in the contract; and
(3) Certification of the local treasurer as to availability of funds together with a
statement that such fund shall not be disbursed or spent for any purpose other than to
pay for the purchase of the property involved.
The respondent was burdened to prove the mandatory requirement of a valid
and definite offer to the owner of the property before filing its complaint and the
rejection thereof by the latter.[48] It is incumbent upon the condemnor to exhaust all
reasonable efforts to obtain the land it desires by agreement.[49] Failure to prove
compliance with the mandatory requirement will result in the dismissal of the
complaint.[50]
An offer is a unilateral proposition which one party makes to the other for the
celebration of a contract.[51] It creates a power of acceptance permitting the offeree, by
accepting the offer, to transform the offerors promise into a contractual
obligation.[52] Corollarily, the offer must be complete, indicating with sufficient
clearness the kind of contract intended and definitely stating the essential conditions
of the proposed contract.[53] An offer would require, among other things, a clear
certainty on both the object and the cause or consideration of the envisioned
contract.[54]
The purpose of the requirement of a valid and definite offer to be first made to
the owner is to encourage settlements and voluntary acquisition of property needed
for public purposes in order to avoid the expense and delay of a court action.[55] The
law is designed to give to the owner the opportunity to sell his land without the
expense and inconvenience of a protracted and expensive litigation. This is a
substantial right which should be protected in every instance. [56] It encourages
acquisition without litigation and spares not only the landowner but also the
condemnor, the expenses and delays of litigation. It permits the landowner to receive
full compensation, and the entity acquiring the property, immediate use and enjoyment
of the property. A reasonable offer in good faith, not merely perfunctory or pro
forma offer, to acquire the property for a reasonable price must be made to the owner
or his privy.[57] A single bona fide offer that is rejected by the owner will suffice.
The expropriating authority is burdened to make known its definite and valid
offer to all the owners of the property. However, it has a right to rely on what appears
in the certificate of title covering the land to be expropriated. Hence, it is required to
make its offer only to the registered owners of the property. After all, it is well-settled
that persons dealing with property covered by a Torrens certificate of title are not
required to go beyond what appears on its face.[58]
In the present case, the respondent failed to prove that before it filed its
complaint, it made a written definite and valid offer to acquire the property for public
use as an access road. The only evidence adduced by the respondent to prove its
compliance with Section 19 of the Local Government Code is the photocopy of the
letter purportedly bearing the signature of Engr. Jose Reyes, to only one of the co-
owners, Lorenzo Ching Cuanco. The letter reads:
MR. LORENZO CHING CUANCO
18 Alcalde Jose Street
Capasigan, Pasig
Metro Manila
Dear Mr. Cuanco:
This refers to your parcel of land located along E. Santos Street, Barangay Palatiw,
Pasig, Metro Manila embraced in and covered by TCT No. 66585, a portion of which
with an area of fifty-one (51) square meters is needed by the Municipal Government of
Pasig for conversion into a road-right of way for the benefit of several residents living
in the vicinity of your property. Attached herewith is the sketch plan for your
information.
In this connection, may we respectfully request your presence in our office to discuss
this project and the price that may be mutually agreed upon by you and the
Municipality of Pasig.
Thank you.
Very truly yours,
(Sgd.)
ENGR. JOSE L.
REYES
Technical Asst. to
the Mayor
on Infrastructure[59]
It bears stressing, however, that the respondent offered the letter only to prove
its desire or intent to acquire the property for a right-of-way. The document was not
offered to prove that the respondent made a definite and valid offer to acquire the
property. Moreover, the RTC rejected the document because the respondent failed to
adduce in evidence the original copy thereof. The respondent, likewise, failed to
adduce evidence that copies of the letter were sent to and received by all the co-
owners of the property, namely, Lorenzo Ching Cuanco, Victor Ching Cuanco and
Ernesto Kho.
The respondent sought to prove, through the testimony of its messenger,
Rolando Togonon, that Lorenzo Ching Cuanco received the original of the said letter.
But Togonon testified that he merely gave the letter to a lady, whom he failed to
identify. He stated that the lady went inside the store of Lorenzo Ching Cuanco, and
later gave the letter back to him bearing the signature purportedly of one Luz Bernarte.
However, Togonon admitted, on cross-examination, that he did not see Bernarte
affixing her signature on the letter. Togonon also declared that he did not know and
had never met Lorenzo Ching Cuanco and Bernarte:
Q And after you received this letter from that lady, what did you do
afterwards?
A I brought it with me, that letter, and then I went to Caruncho.
Q So, [M]r. Witness, you are telling this Honorable Court that this letter
intended to Mr. Lorenzo was served at Pasig Trading which was
situated at No. 18 Alkalde Jose Street on February 23, 1993?
A Yes, Maam.
ATTY. TAN:
That is all for the witness, Your Honor.
COURT:
Do you have any cross-examination?
ATTY. JOLO:
Just a few cross, Your Honor, please. With the kind permission of the
Honorable Court.
COURT:
Proceed.
CROSS-EXAMINATION
BY ATTY. JOLO:
Q Mr. Witness, do you know Mr. Lorenzo Ching [Cuanco]
A I do not know him.
Q As a matter of fact, you have not seen him even once, isnt not (sic)?
A Yes, Sir.
 Q This Luz Bernarte, do you know her?
A I do not know her.
Q As a matter of fact, you did not see Mrs. Bernarte even once?
A That is correct.
Q And as a matter of fact, [M]r. Witness, you did not see Mrs. Luz
Bernarte affixing her signature on the bottom portion of this demand
letter, marked as Exh. C-2?
A Yes, Sir.[62]
Even if the letter was, indeed, received by the co-owners, the letter is not a valid
and definite offer to purchase a specific portion of the property for a price certain. It is
merely an invitation for only one of the co-owners, Lorenzo Ching Cuanco, to a
conference to discuss the project and the price that may be mutually acceptable to
both parties.
There is no legal and factual basis to the CAs ruling that the annotation of a
notice of lis pendens at the dorsal portion of petitioners TCT No. PT-92579 is a
substantial compliance with the requisite offer. A notice of lis pendens is a notice to
the whole world of the pendency of an action involving the title to or possession of real
property and a warning that those who acquire an interest in the property do so at their
own risk and that they gamble on the result of the litigation over it.[63] Moreover, the lis
pendens was annotated at the dorsal portion of the title only on November 26, 1993,
long after the complaint had been filed in the RTC against the Ching Cuancos.
Neither is the declaration in one of the whereas clauses of the ordinance that
the property owners were already notified by the municipality of the intent to purchase
the same for public use as a municipal road, a substantial compliance with the
requirement of a valid and definite offer under Section 19 of R.A. No. 7160.
Presumably, the Sangguniang Bayan relied on the erroneous premise that the letter of
Engr. Reyes reached the co-owners of the property. In the absence of competent
evidence that, indeed, the respondent made a definite and valid offer to all the co-
owners of the property, aside from the letter of Engr. Reyes, the declaration in the
ordinance is not a compliance with Section 19 of R.A. No. 7160.
The respondent contends, however, that the Ching Cuancos, impliedly admitted
the allegation in its complaint that an offer to purchase the property was made to them
and that they refused to accept the offer by their failure to specifically deny such
allegation in their answer. This contention is wrong. As gleaned from their answer to
the complaint, the Ching Cuancos specifically denied such allegation for want of
sufficient knowledge to form a belief as to its correctness. Under Section 10, [64] Rule 8
of the Rules of Court, such form of denial, although not specific, is sufficient.
Public Necessity
We reject the contention of the petitioner that its property can no longer be
expropriated by the respondent because it is intended for the construction of a place
for religious worship and a school for its members. As aptly explained by this Court
in Manosca v. Court of Appeals,[65] thus:
It has been explained as early as Sea v. Manila Railroad Co., that:
A historical research discloses the meaning of the term public use to be one of
constant growth. As society advances, its demands upon the individual increases and
each demand is a new use to which the resources of the individual may be devoted.
for whatever is beneficially employed for the community is a public use.
Chief Justice Enrique M. Fernando states:
The taking to be valid must be for public use. There was a time when it was felt that a
literal meaning should be attached to such a requirement. Whatever project is
undertaken must be for the public to enjoy, as in the case of streets or parks.
Otherwise, expropriation is not allowable. It is not so any more. As long as the
purpose of the taking is public, then the power of eminent domain comes into play. As
just noted, the constitution in at least two cases, to remove any doubt, determines
what is public use. One is the expropriation of lands to be subdivided into small lots for
resale at cost to individuals. The other is the transfer, through the exercise of this
power, of utilities and other private enterprise to the government. It is accurate to state
then that at present whatever may be beneficially employed for the general welfare
satisfies the requirements of public use.
Chief Justice Fernando, writing the ponencia in J.M. Tuason & Co. vs. Land Tenure
Administration, has viewed the Constitution a dynamic instrument and one that is not
to be construed narrowly or pedantically so as to enable it to meet adequately
whatever problems the future has in store. Fr. Joaquin Bernas, a noted
constitutionalist himself, has aptly observed that what, in fact, has ultimately emerged
is a concept of public use which is just as broad as public welfare.
Petitioners ask: But (w)hat is the so-called unusual interest that the expropriation of
(Felix Manalos) birthplace become so vital as to be a public use appropriate for the
exercise of the power of eminent domain when only members of the Iglesia ni
Cristo would benefit? This attempt to give some religious perspective to the case
deserves little consideration, for what should be significant is the principal objective of,
not the casual consequences that might follow from, the exercise of the power. The
purpose in setting up the marker is essentially to recognize the distinctive contribution
of the late Felix Manalo to the culture of the Philippines, rather than to commemorate
his founding and leadership of the Iglesia ni Cristo. The practical reality that greater
benefit may be derived by members of the Iglesia ni Cristo than by most others could
well be true but such a peculiar advantage still remains to be merely incidental and
secondary in nature. Indeed, that only a few would actually benefit from the
expropriation of property, does not necessarily diminish the essence and character of
public use.
The petitioner asserts that the respondent must comply with the requirements
for the establishment of an easement of right-of-way, more specifically, the road must
be constructed at the point least prejudicial to the servient state, and that there must
be no adequate outlet to a public highway. The petitioner asserts that the portion of
the lot sought to be expropriated is located at the middle portion of the petitioners
entire parcel of land, thereby splitting the lot into two halves, and making it impossible
for the petitioner to put up its school building and worship center.
The subject property is expropriated for the purpose of constructing a road. The
respondent is not mandated to comply with the essential requisites for an easement of
right-of-way under the New Civil Code. Case law has it that in the absence of
legislative restriction, the grantee of the power of eminent domain may determine the IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The Decision
location and route of the land to be taken[66] unless such determination is capricious and Resolution of the Court of Appeals are REVERSED AND SET ASIDE. The RTC is
and wantonly injurious.[67] Expropriation is justified so long as it is for the public good ordered to dismiss the complaint of the respondent without prejudice to the refiling
and there is genuine necessity of public character.[68]Government may not capriciously thereof.
choose what private property should be taken.[69]
SO ORDERED.
The respondent has demonstrated the necessity for constructing a road from E.
R. Santos Street to Sto. Tomas Bukid. The witnesses, who were residents of Sto.
Tomas Bukid, testified that although there were other ways through which one can S E C O N D D I V I S I O N
enter the vicinity, no vehicle, however, especially fire trucks, could enter the area
except through the newly constructed Damayan Street. This is more than sufficient to
establish that there is a genuine necessity for the construction of a road in the area. LOURDES DE LA PAZ MASIKIP, G.R. No. 136349
After all, absolute necessity is not required, only reasonable and practical necessity Petitioner,
will suffice.[70]
Nonetheless, the respondent failed to show the necessity for constructing the
road particularly in the petitioners property and not elsewhere. [71] We note that the Present:
whereas clause of the ordinance states that the 51-square meter lot is the shortest
and most suitable access road to connect Sto. Tomas Bukid to E. R. Santos Street.
The respondents complaint also alleged that the said portion of the petitioners lot has - versus -
been surveyed as the best possible ingress and egress. However, the respondent
failed to adduce a preponderance of evidence to prove its claims. PUNO, J., Chairman,

On this point, the trial court made the following findings: SANDOVAL-GUTIERREZ,

The contention of the defendants that there is an existing alley that can serve the CORONA,
purpose of the expropriator is not accurate. An inspection of the vicinity reveals that
THE CITY OF PASIG, HON. AZCUNA, and
the alley being referred to by the defendants actually passes thru Bagong Taon St. but
MARIETTA A. LEGASPI, in her
only about one-half (1/2) of its entire length is passable by vehicle and the other half is GARCIA, JJ.
capacity as Presiding Judge of the
merely a foot-path. It would be more inconvenient to widen the alley considering that
Regional Trial Court of Pasig City,
its sides are occupied by permanent structures and its length from the municipal road
Branch 165 and THE COURT OF
to the area sought to be served by the expropriation is considerably longer than the
APPEALS,
proposed access road. The area to be served by the access road is composed of
compact wooden houses and literally a slum area. As a result of the expropriation of Respondents. Promulgated:
the 51-square meter portion of the property of the intervenor, a 3-meter wide road
open to the public is created. This portion of the property of the intervenor is the most
convenient access to the interior of Sto. Tomas Bukid since it is not only a short cut to
the interior of the Sto. Tomas Bukid but also an easy path for vehicles entering the
area, not to mention the 3-meter wide road requirement of the Fire Code.[72] January 23, 2006
However, as correctly pointed out by the petitioner, there is no showing in the
record that an ocular inspection was conducted during the trial. If, at all, the trial court x-----------------------------------------------------------------------------------------x
conducted an ocular inspection of the subject property during the trial, the petitioner
was not notified thereof. The petitioner was, therefore, deprived of its right to due
process. It bears stressing that an ocular inspection is part of the trial as evidence is
thereby received and the parties are entitled to be present at any stage of the
trial.[73] Consequently, where, as in this case, the petitioner was not notified of any DECISION
ocular inspection of the property, any factual finding of the court based on the said
inspection has no probative weight. The findings of the trial court based on the
conduct of the ocular inspection must, therefore, be rejected.
SANDOVAL GUTIERREZ, J.:
Where the taking by the State of private property is done for the benefit of a small
community which seeks to have its own sports and recreational facility,
notwithstanding that there is such a recreational facility only a short distance away,
such taking cannot be considered to be for public use. Its expropriation is not valid. In
this case, the Court defines what constitutes a genuine necessity for public use.
Subsequently, on February 21, 1995, respondent filed with the trial court a complaint
for expropriation, docketed as SCA No. 873. Respondent prayed that the trial court,
after due notice and hearing, issue an order for the condemnation of the property; that
commissioners be appointed for the purpose of determining the just compensation;
and that judgment be rendered based on the report of the commissioners.
On April 25, 1995, petitioner filed a Motion to Dismiss the complaint on the following
grounds:

I
This petition for review on certiorari assails the Decision[1] of the Court of Appeals
dated October 31, 1997 in CA-G.R. SP No. 41860 affirming the Order[2] of the PLAINTIFF HAS NO CAUSE OF ACTION FOR THE
Regional Trial Court, Branch 165, Pasig City, dated May 7, 1996 in S.C.A. No. 873. EXERCISE OF THE POWER OF EMINENT DOMAIN,
Likewise assailed is the Resolution[3] of the same court dated November 20, 1998 CONSIDERING THAT:
denying petitioners Motion for Reconsideration.

(A) THERE IS NO GENUINE

The facts of the case are: NECESSITY FOR THE TAKING
OF THE PROPERTY SOUGHT TO
BE EXPROPRIATED.
Petitioner Lourdes Dela Paz Masikip is the registered owner of a parcel of land with an
area of 4,521 square meters located at Pag-Asa, Caniogan, Pasig City, Metro Manila.
(B) PLAINTIFF HAS
ARBITRARILY AND
In a letter dated January 6, 1994, the then Municipality of Pasig, now City of Pasig, CAPRICIOUSLY CHOSEN THE
respondent, notified petitioner of its intention to expropriate a 1,500 square meter PROPERTY SOUGHT TO BE
portion of her property to be used for the sports development and recreational EXPROPRIATED.
activities of the residents of Barangay Caniogan. This was pursuant to Ordinance No.
42, Series of 1993 enacted by the then Sangguniang Bayan of Pasig.
(C) EVEN
ASSUMING ARGUENDO THAT
Again, on March 23, 1994, respondent wrote another letter to petitioner, but this time DEFENDANTS PROPERTY MAY
the purpose was allegedly in line with the program of the Municipal Government to BE EXPROPRIATED BY
provide land opportunities to deserving poor sectors of our community. PLAINTIFF, THE FAIR MARKET
VALUE OF THE PROPERTY TO
BE EXPROPRIATED FAR
EXCEEDS SEVENTY-EIGHT
On May 2, 1994, petitioner sent a reply to respondent stating that the intended THOUSAND PESOS (P78,000.00)
expropriation of her property is unconstitutional, invalid, and oppressive, as the area of
her lot is neither sufficient nor suitable to provide land opportunities to deserving poor
sectors of our community.

In its letter of December 20, 1994, respondent reiterated that the purpose of the
expropriation of petitioners property is to provide sports and recreational facilities to its
poor residents. II
 PLAINTIFFS COMPLAINT IS DEFECTIVE IN FORM Petitioner filed a motion for reconsideration but it was denied by the trial court in its
AND SUBSTANCE, CONSIDERING THAT: Order of July 31, 1996. Forthwith, it appointed the City Assessor and City Treasurer of
Pasig City as commissioners to ascertain the just compensation. This prompted
petitioner to file with the Court of Appeals a special civil action for certiorari, docketed
(A) PLAINTIFF FAILS TO ALLEGE as CA-G.R. SP No. 41860. On October 31, 1997, the Appellate Court dismissed the
WITH CERTAINTY THE petition for lack of merit. Petitioners Motion for Reconsideration was denied in a
PURPOSE OF THE Resolution dated November 20, 1998.
EXPROPRIATION.

Hence, this petition anchored on the following grounds:

(B) PLAINTIFF HAS FAILED TO
COMPLY WITH THE
PREREQUISITES LAID DOWN IN THE QUESTIONED DECISION DATED 31 OCTOBER
SECTION 34, RULE VI OF THE 1997 (ATTACHMENT A) AND RESOLUTION DATED
RULES AND REGULATIONS 20 NOVEMBER 1998 (ATTACHMENT B) ARE
IMPLEMENTING THE LOCAL CONTRARY TO LAW, THE RULES OF COURT AND
GOVERNMENT CODE; THUS, JURISPRUDENCE CONSIDERING THAT:
THE INSTANT EXPROPRIATION
PROCEEDING IS PREMATURE.
I

III
A. THERE IS NO EVIDENCE TO
PROVE THAT THERE
THE GRANTING OF THE EXPROPRIATION WOULD IS GENUINE
VIOLATE SECTION 261 (V) OF THE OMNIBUS NECESSITY FOR THE
ELECTION CODE. TAKING OF THE
PETITIONERS
PROPERTY.
IV

B. THERE IS NO EVIDENCE TO
PLAINTIFF CANNOT TAKE POSSESSION OF THE PROVE THAT THE
SUBJECT PROPERTY BY MERELY DEPOSITING AN PUBLIC USE
AMOUNT EQUAL TO FIFTEEN PERCENT (15%) OF REQUIREMENT FOR
THE VALUE OF THE PROPERTY BASED ON THE THE EXERCISE OF
CURRENT TAX DECLARATION OF THE SUBJECT THE POWER OF
PROPERTY.[4] EMINENT DOMAIN HAS
BEEN COMPLIED
WITH.

On May 7, 1996, the trial court issued an Order denying the Motion to Dismiss, [5] on C. THERE IS NO EVIDENCE TO
the ground that there is a genuine necessity to expropriate the property for the PROVE THAT
sports and recreational activities of the residents of Pasig. As to the issue of just RESPONDENT CITY OF
compensation, the trial court held that the same is to be determined in accordance PASIG HAS COMPLIED
with the Revised Rules of Court. WITH ALL CONDITIONS
 PRECEDENT FOR THE
EXERCISE OF THE
POWER OF EMINENT
DOMAIN.
THE COURT A QUOS ORDER DATED 07 MAY 1996
AND 31 JULY 1996, WHICH WERE AFFIRMED BY
THE COURT OF APPEALS, EFFECTIVELY AMOUNT
TO THE TAKING OF PETITIONERS PROPERTY
WITHOUT DUE PROCESS OF LAW:
II
THE COURT OF APPEALS
GRAVELY ERRED IN APPLYING
OF RULE ON ACTIONABLE
DOCUMENTS TO THE
DOCUMENTS ATTACHED TO
RESPONDENT CITY OF
PASIGS COMPLAINT DATED 07
APRIL 1995 TO JUSTIFY THE
COURT A QUOS DENIAL OF
PETITIONERS RESPONSIVE
PLEADING TO THE COMPLAINT
FOR EXPROPRIATION (THE
MOTION TO DISMISS DATED 21
APRIL 1995).
III
THE COURT OF APPEALS
GRAVELY ERRED IN APPLYING
THE RULE ON HYPOTHETICAL
ADMISSION OF FACTS ALLEGED
IN A COMPLAINT CONSIDERING
THAT THE MOTION TO
DISMISS FILED BY PETITIONER
IN THE EXPROPRIATION CASE
BELOW WAS THE RESPONSIVE
PLEADING REQUIRED TO BE
FILED UNDER THE THEN RULE
67 OF THE RULES OF COURT
AND NOT AN ORIDNARY
MOTION TO DISMISS UNDER
RULE 16 OF THE RULES OF
COURT.
The foregoing arguments may be synthesized into two main issues one substantive
and one procedural. We will first address the procedural issue.
Petitioner filed her Motion to Dismiss the complaint for expropriation on April 25, 1995.
It was denied by the trial court on May 7, 1996. At that time, the rule on expropriation
was governed by Section 3, Rule 67 of the Revised Rules of Court which provides:
SEC. 3. Defenses and objections. Within the time specified in the
summons, each defendant, in lieu of an answer, shall present in a
single motion to dismiss or for other appropriate relief, all his
objections and defenses to the right of the plaintiff to take his
property for the use or purpose specified in the complaint. All
such objections and defenses not so presented are waived. A
copy of the motion shall be served on the plaintiffs attorney of
record and filed with the court with proof of service.
The motion to dismiss contemplated in the above Rule clearly constitutes the
responsive pleading which takes the place of an answer to the complaint for
expropriation. Such motion is the pleading that puts in issue the right of the plaintiff to
expropriate the defendants property for the use specified in the complaint. All that the
law requires is that a copy of the said motion be served on plaintiffs attorney of record.
It is the court that at its convenience will set the case for trial after the filing of the said
pleading.[6]
The Court of Appeals therefore erred in holding that the motion to dismiss filed by
petitioner hypothetically admitted the truth of the facts alleged in the complaint,
specifically that there is a genuine necessity to expropriate petitioners property for
public use. Pursuant to the above Rule, the motion is a responsive pleading joining the
issues. What the trial court should have done was to set the case for the reception of
evidence to determine whether there is indeed a genuine necessity for the taking of
the property, instead of summarily making a finding that the taking is for public use
and appointing commissioners to fix just compensation. This is especially so
considering that the purpose of the expropriation was squarely challenged and put in
issue by petitioner in her motion to dismiss.

Significantly, the above Rule allowing a defendant in an expropriation case to file a
motion to dismiss in lieu of an answer was amended by the 1997 Rules of Civil
Procedure, which took effect on July 1, 1997. Section 3, Rule 67 now expressly
mandates that any objection or defense to the taking of the property of a defendant
must be set forth in an answer.
The fact that the Court of Appeals rendered its Decision in CA-G.R. SP No. 41860 on
October 31, after the 1997 Rules of Civil Procedure took effect, is of no moment. It is
only fair that the Rule at the time petitioner filed her motion to dismiss should govern.
The new provision cannot be applied retroactively to her prejudice.
We now proceed to address the substantive issue.
In the early case of US v. Toribio,[7] this Court defined the power of eminent domain as
the right of a government to take and appropriate private property to public use,
whenever the public exigency requires it, which can be done only on condition of
providing a reasonable compensation therefor. It has also been described as the
power of the State or its instrumentalities to take private property for public use and is
inseparable from sovereignty and inherent in government.[8]
The power of eminent domain is lodged in the legislative branch of the government. It
delegates the exercise thereof to local government units, other public entities and
public utility corporations,[9] subject only to Constitutional limitations. Local
governments have no inherent power of eminent domain and may exercise it only
when expressly authorized by statute.[10] Section 19 of the Local Government Code of
1991 (Republic Act No. 7160) prescribes the delegation by Congress of the power of
eminent domain to local government units and lays down the parameters for its
exercise, thus:
SEC. 19. Eminent Domain. A local government unit may, through
its chief executive and acting pursuant to an ordinance, exercise
the power of eminent domain for public use, purpose or welfare
for the benefit of the poor and the landless, upon payment of just
compensation, pursuant to the provisions of the Constitution and
pertinent laws: Provided, however, That, the power of eminent
domain may not be exercised unless a valid and definite offer has
been previously made to the owner and such offer was not
accepted: Provided, further, That, the local government unit may
immediately take possession of the property upon the filing of
expropriation proceedings and upon making a deposit with the
proper court of at least fifteen percent (15%) of the fair market
value of the property based on the current tax declaration of the
property to be expropriated: Provided, finally, That, the amount to
be paid for expropriated property shall be determined by the
proper court, based on the fair market value at the time of the
taking of the property.
Judicial review of the exercise of eminent domain is limited to the following areas of
concern: (a) the adequacy of the compensation, (b) the necessity of the taking, and (c)
the public use character of the purpose of the taking.[11]
In this case, petitioner contends that respondent City of Pasig failed to establish a
genuine necessity which justifies the condemnation of her property. While she does
not dispute the intended public purpose, nonetheless, she insists that there must be a
genuine necessity for the proposed use and purposes. According to petitioner, there is
already an established sports development and recreational activity center at
Rainforest Park in Pasig City, fully operational and being utilized by its residents,
including those from Barangay Caniogan. Respondent does not dispute this.
Evidently, there is no genuine necessity to justify the expropriation.
The right to take private property for public purposes necessarily originates from the
necessity and the taking must be limited to such necessity. In City of Manila v.
Chinese Community of Manila, we held that the very foundation of the right to
exercise eminent domain is a genuine necessity and that necessity must be of a
public character. Moreover, the ascertainment of the necessity must precede or
accompany and not follow, the taking of the land. In City of Manila v. Arellano Law
College, we ruled that necessity within the rule that the particular property to be
expropriated must be necessary, does not mean an absolute but only a reasonable or
practical necessity, such as would combine the greatest benefit to the public with the
least inconvenience and expense to the condemning party and the property owner
consistent with such benefit.
Applying this standard, we hold that respondent City of Pasig has failed to
establish that there is a genuine necessity to expropriate petitioners property. Our
scrutiny of the records shows that the Certification issued by the Caniogan Barangay
Council dated November 20, 1994, the basis for the passage of Ordinance No. 42 s.
1993 authorizing the expropriation, indicates that the intended beneficiary is the
Melendres Compound Homeowners Association, a private, non-profit organization, not
the residents of Caniogan. It can be gleaned that the members of the said Association
are desirous of having their own private playground and recreational facility.
Petitioners lot is the nearest vacant space available. The purpose is, therefore, not
clearly and categorically public. The necessity has not been shown, especially
considering that there exists an alternative facility for sports development and
community recreation in the area, which is the Rainforest Park, available to all
residents of Pasig City, including those of Caniogan.
 The right to own and possess property is one of the most cherished rights of March 24,
men. It is so fundamental that it has been written into organic law of every nation 2008
where the rule of law prevails. Unless the requisite of genuine necessity for the
expropriation of ones property is clearly established, it shall be the duty of the courts
to protect the rights of individuals to their private property. Important as the power of x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x
eminent domain may be, the inviolable sanctity which the Constitution attaches to the
property of the individual requires not only that the purpose for the taking of private
property be specified. The genuine necessity for the taking, which must be of a public
character, must also be shown to exist. RESOLUTION

WHEREFORE, the petition for review is GRANTED. The challenged

Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 41860 CORONA, J.:
are REVERSED. The complaint for expropriation filed before the trial court by
respondent City of Pasig, docketed as SCA No. 873, is ordered DISMISSED.

On February 6, 2003, respondent Municipality of Meycauayan, Bulacan filed a

complaint for expropriation[1] against petitioners Amos P. Francia, Jr., Cecilia P.
SO ORDERED. Francia and Benjamin P. Francia[2] in the Regional Trial Court (RTC) of Malolos,
FIRST DIVISION Bulacan, Branch 16. Respondent needed petitioners' 16,256 sq. m. idle property at
the junction of the North Expressway, Malhacan-Iba-Camalig main road artery and the
MacArthur Highway.[3] It planned to use it to establish a common public terminal for all
types of public utility vehicles with a weighing scale for heavy trucks.
AMOS P. FRANCIA, JR., G.R. No. 170432
CECILIA P. FRANCIA,
In their answer,[4] petitioners denied that the property sought to be expropriated was
AND HEIRS OF BENJAMIN raw land. It was in fact developed[5] and there were plans for further development. For
P. FRANCIA, Present: this reason, respondents offer price of P2,333,500 (or P111.99 per square meter) was
too low.
Petitioners,
PUNO, C.J., Chairperson,
After trial, the RTC ruled that the expropriation was for a public purpose. The
CARPIO, construction of a common terminal for all public utility conveyances (serving as a two-
way loading and unloading point for commuters and goods) would improve the flow of
CORONA, vehicular traffic during rush hours. Moreover, the property was the best site for the
AZCUNA and proposed terminal because of its accessibility. Thus, on November 8, 2004, the RTC
issued the following order:[6]
- v e r s u s - LEONARDO-DE CASTRO, JJ.
WHEREFORE, premises considered, after [respondent] has
deposited with this Court the fifteen percent (15%) of the fair
market value of the property based on the current tax
MUNICIPALITY OF declaration of the property to be expropriated, it may take
MEYCAUAYAN, immediate possession of the property upon issuance of writ of
possession that this court will issue for that purpose.
Respondent. Promulgated:

Further, the purposes of assessment and determination of the

area needed that will suit the purpose of expropriation and just
 compensation of the lot sought to be expropriated, the court
hereby appoints commissioners to be composed of the officer-
in-charge of this court, Lerida Socorro E. Joson and one each
from [respondent] and [petitioners].
Notify all parties concerned.
SO ORDERED.[7]
Petitioners moved for the reconsideration of the November 8, 2004 order but the
motion was denied in an order dated January 31, 2005.
Aggrieved, petitioners filed a petition for certiorari in the Court of Appeals (CA)
contending that the RTC committed grave abuse of discretion in issuing its November
8, 2004 and January 31, 2005 orders. They claimed that the trial court issued the
orders without conducting a hearing to determine the existence of a public purpose.
On July 28, 2005, the CA rendered a decision[8] partially granting the petition. Finding
that petitioners were deprived of an opportunity to controvert respondent's allegations,
the appellate court nullified the order of expropriation except with regard to the writ of
possession. According to the CA, a hearing was not necessary because once the
expropriator deposited the required amount (with the Court), the issuance of a writ of
possession became ministerial.
Petitioners moved for partial reconsideration but their motion was denied. Hence, this
recourse.
Petitioners essentially aver that the CA erred in upholding the RTC's orders that, in
expropriation cases, prior determination of the existence of a public purpose was not
necessary for the issuance of a writ of possession.
We deny the petition.
Section 19 of Republic Act 7160[9] provides:
Section 19. Eminent Domain. A local government unit may,
through its chief executive and acting pursuant to an ordinance,
exercise the power of eminent domain for public use, or
purpose, or welfare for the benefit of the poor and the landless,
upon payment of just compensation, pursuant to the provisions
of the Constitution and pertinent laws; Provided, however, That
the power of eminent domain may not be exercised unless a
valid and definite offer has been previously made to the owner,
and that such offer was not accepted; Provided, further, That
the local government unit may immediately take possession
of the property upon the filing of the expropriation
proceedings and upon making a deposit with the proper
court of at least fifteen percent (15%) of the fair market
value of the property based on the current tax declaration of
the property to be expropriated; Provided, finally, That, the
amount to be paid for the expropriated property shall be
determined by the proper court, based on the fair market value
at the time of the taking of the property. (emphasis supplied)[10]
Before a local government unit may enter into the possession of the property sought to
be expropriated, it must (1) file a complaint for expropriation sufficient in form and
substance in the proper court and (2) deposit with the said court at least 15% of the
property's fair market value based on its current tax declaration. The law does not
make the determination of a public purpose a condition precedent to the issuance of a
writ of possession.
WHEREFORE, the petition is hereby DENIED.
Costs against petitioners.
SO ORDERED.
EN BANC
G.R. No. L-16165 July 31, 1961
PEDRO S. ALIALY, JOSE CAYETANO, FORTUNATO VIDAL, BRECCIO
BAUTISTA, CASIANO MALITAO, PATRICIO HERRERA and the NACIONALISTA
PARTY (Local Chapter at Victoria Oriental Mindoro),petitioners,
vs.
COMMISSION ON ELECTIONS, respondent.
Leido, Andrada, Perez and Associates for petitioners.
Ramon Barrios for respondent.
PAREDES, J.:
This is a petition for Certiorari and Mandamus, with Writ of Preliminary Mandatory
Injunction filed on November 2, 1959, by Pedro S. Alialy, Jose Cayetano, Fortunato
Vidal, Breccio Bautista, Casiano Malitao, Patricio Herrera, and the Nacionalista Party
(Local Chapter, Victoria Oriental Mindoro), against the Commission on Elections.
On September 1, 1959, a collective certificate of candidacy for the November 10, 1959
elections for the petitioners as councilors, Fe B. Marquez as Mayor and Timoteo
Ocampo, as Vice Mayor, signed and sworn to by Fe B. Marquez, in her capacity as
Chairman of the Local Chapter of the Nacionalista Party in the town of Victoria,
Oriental Mindoro was filed with the respondent Commission on Elections (Annex A).
On October 14, 1959, the Commission ruled:
. . . It appearing that this certificate of candidacy is subscribed under oath
only by the chairman and not by the secretary also of the party, and,
therefore, is not prepared in compliance with Section 35 of the Revised
Election Code, the Commission, as recommended by the Law
Division, RESOLVED not to give due course to the said certificate of
candidacy in favor of its candidates for local offices aforementioned.
However, it appearing that Fe B. Marquez is a candidate for mayor in the
ticket and considering that her signature and oath appear in the certificate of
candidacy is considered valid only insofar as the candidacy of Fe B.
Marquez for mayor concerned. . .
Petitioners, on October 27, 1959, presented a motion for reconsideration, stating that
the omission of the signature called for, amounts merely to an inconsequential
deviation, not sufficient to invalidate the certificate of candidacy of petitioners, since
the said omission cannot influence, by itself, the result of the election in the place.
On October 29, 1959, a supplement to the Motion for Reconsideration was filed,
alleging that the Local Chapter of the Nacionalista Party Of Victoria, had filed an
amended certificate of candidacy (Annex D), dated October 26, 1959, which confirmed
the genuineness and purpose of the original certificate of candidacy and bore already
the signatures of the Chairman and Secretary of the Chapter. On October 30, 1959,
petitioners' counsel was advised that the motion for reconsideration was denied.
Because of the proximity of the elections, the petitioners filed with this Court on
November 2, 1959, the present action, contending that the respondent Commission, in
not giving due course to their collective certificate of candidacy filed by the party,
acted without or in excess of jurisdiction petition, or with grave abuse of discretion and
unlawfully excluded the herein petitioners from the enjoyment of the right to be
candidates.
Petitioners also prayed for the issuance, ex-parte, of a preliminary mandatory
injunction, claiming that the enforcement of the Commissioners resolution will cause
irreparable injury, for then the Nacionalista Party would have no candidates for such
office in said town and that the votes cast in their favor will not be counted and that
respondent Commission be restrained from enforcing its Resolution of October 14,
1959.
On November 4, 1959, after posting a P200.00 bond, a Writ of Preliminary Mandatory
Injunction was issued, ordering the respondent to give due course to the certificate of
candidacy of petitioners and to account the votes cast in their favor.
Respondent answered and argued that the certificate in question failed to comply with
the requirements of Section 35 of the Election Law; that the absence of the signature
of the Secretary of the political party, was a fatal defect; that the amended certificate
of candidacy was presented on October 29, 1959, long after the expiration of the
deadline for filing certificates of candidacies, which was September 11, 1959, and that
since the original certificate of candidacy was not valid, there was nothing to confirm
or amend.
Section 35 of the Election Law provides:
Certificates of candidacy of candidates may be filed by a political party
nominating them without the signature or oath of said candidates.
Any political party having officially nominated candidates shall file with the
Commission on Elections a certificate of such official nominations
subscribed under oath by the president and secretary or corresponding
officers of such political group or party. . . . .
The absence of the signature of the Secretary of the local chapter N.P. in the original
certificate of candidacy, presented before the deadline, September 11, 1959, did not
render the certificate invalid. The amendment of the certificate, although at a date after
the deadline, but before the election, was a substantial compliance with the law, and
the defect was cured. It must be recalled that the respondent Commission acted on
the original certificate in question, only on October 14, 1959, long after the deadline.
The requirement to file a certificate of candidacy is to make known to the respondent
Commission that the person therein mentioned has been nominated by a duly
authorized political agrupation empowered to act and that it reflects accurately the
sentiment of the nominating body; that the candidate is a resident of the municipality;
that he is eligible for the office to which he wanted to be elected; and that he belongs
to a party. No one has impugned the genuineness of the certificate of candidacy in
question. Officers of the party who are called upon to certify, affirmed and confirmed
the truthfulness of the original certificate of candidacy. The respondent commission
ruled that the requirements of section 35 aforequoted, are mandatory upon those who
wish to claim the exercise of the privilege of being a candidate, and failure of the party
secretary to sign the original certificate was not a mere inconsequential deviation, but
it rendered the same null and void. Considering however, the facts obtaining in this
particular case, as heretofore recited, the respondent Commission has sacrificed
substance to form. In cases similar to the one under consideration, a directory
construction of the law was adopted. It is said that "when the Election Law does not
provide that a departure from a prescribed form will be fatal and such departure has
been due to an honest mistake or misinterpretation of the Election Law on the part of
him who was obligated to observe it, and such departure has not been used as a
means for fraudulent practices . . . the law will be held directory and such departure
will be considered a harmless irregularity." (Gardiner v. Romulo 26 Phil. 521, cited in
the De Guzman v. Bd. of Canvassers of La Union and Lucero, 48 Phil. 211, 214-215).
For inconsequential deviations which can not affect the result of the election, or
deviations from provisions intended primarily to secure timely and orderly conduct of
elections, generally applied (III Sutherland Stat. Const. 3rd Ed. Sec. 5820, pp. 113-
114 cases cited therein. The same ruling is given on acts not calculated to affect BERNARDO L. LOZADA, SR., and the DEL CASTILLO,
the integrity of the elections (Hunt V. Mann 136 Miss. 590). The omission in the
certificate in question did not at all affect the integrity of the elections in the town of HEIRS OF ROSARIO MERCADO, namely, VICENTE LOZADA, ABAD,
Victoria. It had occasioned injury to no one. In the recent and identical case of MARIO M. LOZADA, MARCIA L. GODINEZ, VIRGINIA L. FLORES,
BERNARDO LOZADA, JR., DOLORES GACASAN, SOCORRO VILLARAMA, JR.,
Canceran, et al., v. The Commission on Elections, G.R. No. L-16132, March 30, 1960,
We said: CAFARO and ROSARIO LOZADA, represented by MARCIA PEREZ, and
LOZADA GODINEZ,
. . .. Moreover, the timely filing of the motion for reconsideration (Annex D) MENDOZA, JJ.
by petitioners on October 15, 1959 has, in effect, cured the said defect of Respondents.
the certificate, inasmuch as it includes as petitioners or movants, the
chairman and secretary of the Nacionalista Party in Cauayan, Isabela, the Promulgated:
very officials required by the statute to sign said certificate. In the case of
Gabaldon V. commission on Elections (G.R. No. L-9895, prom. September
12, 1956), this Court, in effect, has held that when the original defects of a
February 25, 2010
certificate of candidacy are cured by the allegations of a motion for
reconsideration filed in due time (that is, before the election) with the
Commission on Elections, there is substantial compliance with the statutory
requirement of Section 35. (Emphasis supplied)
x------------------------------------------------------------------------------------x
Petitioner Pedro S. Alialy in that election, was elected councilor of the town (Exhibit F).
If a substantial compliance with section 35 of the Election Law shall give way to a
mere technicality, the will of the electorate in said town, as far as petitioner Alialy, is
concerned, would be frustrated (De Guzman v. Bd. of Canvassers of La Union and
Lucero,supra; Cecilio v. Belmonte, 51 Phil. 540). DECISION

IN VIEW HEREOF, the resolution of respondent Commission dated October 14, 1959
is reversed, the petition is granted and the writ of preliminary mandatory injunction
NACHURA, J.:
heretofore issued, is hereby made and definite. No costs.
EN BANC
This is a petition for review on certiorari under Rule 45 of the Rules of Court, seeking
to reverse, annul, and set aside the Decision[1] dated February 28, 2006 and the
Resolution[2] dated February 7, 2007 of the Court of Appeals (CA) (Cebu City),
MACTAN-CEBU INTERNATIONAL AIRPORT AUTHORITY and AIR G.R. No. 176625 Twentieth Division, in CA-G.R. CV No. 65796.
TRANSPORTATION OFFICE,
Petitioners,
Present: The antecedent facts and proceedings are as follows:

PUNO, C.J., Subject of this case is Lot No. 88-SWO-25042 (Lot No. 88), with an area of 1,017
square meters, more or less, located in Lahug, Cebu City. Its original owner was
CARPIO,
Anastacio Deiparine when the same was subject to expropriation proceedings,
CORONA, initiated by the Republic of the Philippines (Republic), represented by the then Civil
- versus - Aeronautics Administration (CAA), for the expansion and improvement of the Lahug
CARPIO MORALES,VELASCO,
Airport. The case wasJR.,
filed with the then Court of First Instance of Cebu, Third Branch,
NACHURA, LEONARDO-DE CASTRO,
and docketed as Civil Case No. R-1881.
BRION,
PERALTA,* As early as 1947, the lots were already occupied by the U.S. Army. They were turned
BERSAMIN, over to the Surplus Property Commission, the Bureau of Aeronautics, the National
Airport Corporation and then to the CAA.
During the pendency of the expropriation proceedings, respondent Bernardo L.
Lozada, Sr. acquired Lot No. 88 from Deiparine. Consequently, Transfer Certificate of
Title (TCT) No. 9045 was issued in Lozadas name.
On December 29, 1961, the trial court rendered judgment in favor of the Republic and
ordered the latter to pay Lozada the fair market value of Lot No. 88, adjudged at P3.00
per square meter, with consequential damages by way of legal interest computed from
November 16, 1947the time when the lot was first occupied by the airport. Lozada
received the amount of P3,018.00 by way of payment.
The affected landowners appealed. Pending appeal, the Air Transportation Office
(ATO), formerly CAA, proposed a compromise settlement whereby the owners of the
lots affected by the expropriation proceedings would either not appeal or withdraw
their respective appeals in consideration of a commitment that the expropriated lots
would be resold at the price they were expropriated in the event that the ATO would
abandon the Lahug Airport, pursuant to an established policy involving similar
cases. Because of this promise, Lozada did not pursue his appeal. Thereafter, Lot No.
88 was transferred and registered in the name of the Republic under TCT No. 25057.
The projected improvement and expansion plan of the old Lahug Airport, however,
was not pursued.
Lozada, with the other landowners, contacted then CAA Director Vicente Rivera, Jr.,
requesting to repurchase the lots, as per previous agreement. The CAA replied that
there might still be a need for the Lahug Airport to be used as an emergency DC-3
airport. It reiterated, however, the assurance that should this Office dispose and resell
the properties which may be found to be no longer necessary as an airport, then the
policy of this Office is to give priority to the former owners subject to the approval of
the President.
On November 29, 1989, then President Corazon C. Aquino issued a Memorandum to
the Department of Transportation, directing the transfer of general aviation operations
of theLahug Airport to the Mactan International Airport before the end of 1990 and,
upon such transfer, the closure of the Lahug Airport.
Sometime in 1990, the Congress of the Philippines passed Republic Act (R.A.) No.
6958, entitled An Act Creating the Mactan-Cebu International Airport Authority,
Transferring Existing Assets of the Mactan International Airport and the Lahug Airport
to the Authority, Vesting the Authority with Power to Administer and Operate the
Mactan International Airport and the Lahug Airport, and For Other Purposes.
From the date of the institution of the expropriation proceedings up to the present, the
public purpose of the said expropriation (expansion of the airport) was never actually
initiated, realized, or implemented. Instead, the old airport was converted into a
commercial complex. Lot No. 88 became the site of a jail known as Bagong Buhay
Rehabilitation Complex, while a portion thereof was occupied by squatters. [3] The old
airport was converted into what is now known as the Ayala I.T. Park, a commercial
area.
Thus, on June 4, 1996, petitioners initiated a complaint for the recovery of possession
and reconveyance of ownership of Lot No. 88. The case was docketed as Civil Case
No. CEB-18823 and was raffled to the Regional Trial Court (RTC), Branch
57, Cebu City. The complaint substantially alleged as follows:
(a) Spouses Bernardo and Rosario Lozada were the registered
owners of Lot No. 88 covered by TCT No. 9045;
(b) In the early 1960s, the Republic sought to acquire by
expropriation Lot No. 88, among others, in connection with
its program for the improvement and expansion of
the Lahug Airport;
(c) A decision was rendered by the Court of First Instance in favor
of the Government and against the land owners, among
whom was Bernardo Lozada, Sr. appealed therefrom;
(d) During the pendency of the appeal, the parties entered into a
compromise settlement to the effect that the subject
property would be resold to the original owner at the same
price when it was expropriated in the event that the
Government abandons the Lahug Airport;
(e) Title to Lot No. 88 was subsequently transferred to the
Republic of the Philippines (TCT No. 25057);
(f) The projected expansion and improvement of
the Lahug Airport did not materialize;
 (g) Plaintiffs sought to repurchase their property from then CAA
Director Vicente Rivera. The latter replied by giving as
assurance that priority would be given to the previous
owners, subject to the approval of the President, should
CAA decide to dispose of the properties;
(h) On November 29, 1989, then President Corazon C. Aquino,
through a Memorandum to the Department of
Transportation and Communications (DOTC), directed the
transfer of general aviation operations at
the Lahug Airport to the Mactan-Cebu International Airport
Authority;
(i) Since the public purpose for the expropriation no longer exists,
the property must be returned to the plaintiffs.[4]
In their Answer, petitioners asked for the immediate dismissal of the complaint. They
specifically denied that the Government had made assurances to reconvey Lot No. 88
to respondents in the event that the property would no longer be needed for airport
operations. Petitioners instead asserted that the judgment of condemnation was
unconditional, and respondents were, therefore, not entitled to recover the
expropriated property notwithstanding non-use or abandonment thereof.
After pretrial, but before trial on the merits, the parties stipulated on the following set of
facts:
(1) The lot involved is Lot No. 88-SWO-25042 of the Banilad
Estate, situated in the City of Cebu, containing an area of
One Thousand Seventeen (1,017) square meters, more or
less;
(2) The property was expropriated among several other properties
in Lahug in favor of the Republic of the Philippines by
virtue of a Decision dated December 29, 1961 of the CFI
of Cebu in Civil Case No. R-1881;
(3) The public purpose for which the property was expropriated
was for the purpose of the Lahug Airport;
(4) After the expansion, the property was transferred in the name
of MCIAA; [and]
(5) On November 29, 1989, then President Corazon C. Aquino
directed the Department of Transportation and
Communication to transfer general aviation operations of
the Lahug Airport to the Mactan-Cebu International Airport
Authority and to close the Lahug Airport after such
transfer[.][5]
During trial, respondents presented Bernardo Lozada, Sr. as their lone witness, while
petitioners presented their own witness, Mactan-Cebu International Airport Authority
legal assistant Michael Bacarisas.
On October 22, 1999, the RTC rendered its Decision, disposing as follows:
WHEREFORE, in the light of the foregoing, the Court hereby
renders judgment in favor of the plaintiffs, Bernardo L. Lozada,
Sr., and the heirs of Rosario Mercado, namely, Vicente M.
Lozada, Marcia L. Godinez, Virginia L. Flores, Bernardo M.
Lozada, Jr., Dolores L. Gacasan, Socorro L. Cafaro and Rosario
M. Lozada, represented by their attorney-in-fact Marcia Lozada
Godinez, and against defendants Cebu-Mactan International
Airport Authority (MCIAA) and Air Transportation Office (ATO):
1. ordering MCIAA and ATO to restore to plaintiffs the
possession and ownership of their land, Lot No. 88 Psd-821
(SWO-23803), upon payment of the expropriation price to
plaintiffs; and
2. ordering the Register of Deeds to effect the transfer of
the Certificate of Title from defendant[s] to plaintiffs on Lot No.
[88], cancelling TCT No. 20357 in the name of defendant MCIAA
and to issue a new title on the same lot in the name of Bernardo
L. Lozada, Sr. and the heirs of Rosario Mercado, namely: Vicente
M. Lozada, Mario M. Lozada, Marcia L. Godinez, Virginia L.
Flores, Bernardo M. Lozada, Jr., Dolores L. Gacasan, Socorro L.
Cafaro and Rosario M. Lozada.
No pronouncement as to costs.
 SO ORDERED.[6]
Aggrieved, petitioners interposed an appeal to the CA. After the filing of the necessary
appellate briefs, the CA rendered its assailed Decision dated February 28, 2006,
denying petitioners appeal and affirming in toto the Decision of the RTC, Branch
57, Cebu City. Petitioners motion for reconsideration was, likewise, denied in the
questioned CA Resolution dated February 7, 2007.
Hence, this petition arguing that: (1) the respondents utterly failed to prove that there
was a repurchase agreement or compromise settlement between them and the
Government; (2) the judgment in Civil Case No. R-1881 was absolute and
unconditional, giving title in fee simple to the Republic; and (3) the respondents claim
of verbal assurances from government officials violates the Statute of Frauds.
The petition should be denied.
When land has been acquired for public use in fee
simple, unconditionally, either by the exercise of eminent domain
or by purchase, the former owner retains no right in the land, and
the public use may be abandoned, or the land may be devoted to
a different use, without any impairment of the estate or title
acquired, or any reversion to the former owner. x x x.[8]
Contrary to the stance of petitioners, this Court had ruled otherwise in Heirs
of Timoteo Moreno and Maria Rotea v. Mactan-Cebu International Airport
Authority,[9] thus
Moreover, respondent MCIAA has brought to our attention a
significant and telling portion in the Decision in Civil Case No. R-
1881 validating our discernment that the expropriation by the
predecessors of respondent was ordered under the running
impression that Lahug Airport would continue in operation

Petitioners anchor their claim to the controverted property on the supposition that the As for the public purpose of the expropriation
Decision in the pertinent expropriation proceedings did not provide for the condition proceeding, it cannot now be
that should the intended use of Lot No. 88 for the expansion of the Lahug Airport be doubted. Although Mactan Airport is being
aborted or abandoned, the property would revert to respondents, being its former constructed, it does not take away the actual
owners.Petitioners cite, in support of this position, Fery v. Municipality of usefulness and importance of
Cabanatuan,[7] which declared that the Government acquires only such rights in the Lahug Airport: it is handling the air traffic
expropriated parcels of land as may be allowed by the character of its title over the both civilian and military. From it aircrafts fly
properties to Mindanao and Visayas and pass thru it on
their flights to the North and Manila. Then, no
evidence was adduced to show how soon is
the Mactan Airport to be placed in operation
If x x x land is expropriated for a particular purpose, with the and whether the Lahug Airport will be closed
condition that when that purpose is ended or abandoned the immediately thereafter. It is up to the other
property shall return to its former owner, then, of course, when the departments of the Government to determine
purpose is terminated or abandoned the former owner reacquires said matters. The Court cannot substitute its
the property so expropriated. If x x x land is expropriated for a judgment for those of the said departments or
public street and the expropriation is granted upon condition that agencies.In the absence of such showing, the
the city can only use it for a public street, then, of course, when Court will presume that the Lahug Airport will
the city abandons its use as a public street, it returns to the former continue to be in operation (emphasis
owner, unless there is some statutory provision to the contrary.x x supplied).
x. If, upon the contrary, however, the decree of expropriation
gives to the entity a fee simple title, then, of course, the land
becomes the absolute property of the expropriator, whether it be
the State, a province, or municipality, and in that case the non- While in the trial in Civil Case No. R-1881 [we] could have simply
user does not have the effect of defeating the title acquired by the acknowledged the presence of public purpose for the exercise of
expropriation proceedings. x x x. eminent domain regardless of the survival of Lahug Airport, the
trial court in its Decision chose not to do so but instead prefixed
 its finding of public purpose upon its understanding
that Lahug Airport will continue to be in operation. Verily, these
meaningful statements in the body of the Decision warrant the
conclusion that the expropriated properties would remain to be so
until it was confirmed that Lahug Airport was no longer in
operation. This inference further implies two (2) things: (a) after
the Lahug Airport ceased its undertaking as such and the
expropriated lots were not being used for any airport expansion
project, the rights vis--vis the expropriated Lots Nos. 916 and 920
as between the State and their former owners, petitioners herein,
must be equitably adjusted; and (b) the foregoing unmistakable
declarations in the body of the Decision should merge with and
become an intrinsic part of the fallo thereof which under the
premises is clearly inadequate since the dispositive portion is not
in accord with the findings as contained in the body thereof.[10]
Indeed, the Decision in Civil Case No. R-1881 should be read in its entirety, wherein it
is apparent that the acquisition by the Republic of the expropriated lots was subject to
the condition that the Lahug Airport would continue its operation. The condition not
having materialized because the airport had been abandoned, the former owner
should then be allowed to reacquire the expropriated property. [11]
On this note, we take this opportunity to revisit our ruling in Fery, which involved an
expropriation suit commenced upon parcels of land to be used as a site for a public
market.Instead of putting up a public market, respondent Cabanatuan constructed
residential houses for lease on the area. Claiming that the municipality lost its right to
the property taken since it did not pursue its public purpose, petitioner Juan Fery, the
former owner of the lots expropriated, sought to recover his properties. However, as
he had admitted that, in 1915, respondent Cabanatuan acquired a fee simple title to
the lands in question, judgment was rendered in favor of the municipality, following
American jurisprudence, particularly City of Fort Wayne v. Lake Shore & M.S. RY.
Co.,[12] McConihay v. Theodore Wright,[13] and Reichling v. Covington Lumber
Co.,[14] all uniformly holding that the transfer to a third party of the expropriated real
property, which necessarily resulted in the abandonment of the particular public
purpose for which the property was taken, is not a ground for the recovery of the same
by its previous owner, the title of the expropriating agency being one of fee simple.
Obviously, Fery was not decided pursuant to our now sacredly held constitutional right
that private property shall not be taken for public use without just compensation. [15] It is
well settled that the taking of private property by the Governments power of eminent
domain is subject to two mandatory requirements: (1) that it is for a particular public
purpose; and (2) that just compensation be paid to the property owner. These
requirements partake of the nature of implied conditions that should be complied with
to enable the condemnor to keep the property expropriated. [16]
More particularly, with respect to the element of public use, the expropriator should
commit to use the property pursuant to the purpose stated in the petition for
expropriation filed, failing which, it should file another petition for the new purpose. If
not, it is then incumbent upon the expropriator to return the said property to its private
owner, if the latter desires to reacquire the same. Otherwise, the judgment of
expropriation suffers an intrinsic flaw, as it would lack one indispensable element for
the proper exercise of the power of eminent domain, namely, the particular public
purpose for which the property will be devoted. Accordingly, the private property
owner would be denied due process of law, and the judgment would violate the
property owners right to justice, fairness, and equity.
In light of these premises, we now expressly hold that the taking of private property,
consequent to the Governments exercise of its power of eminent domain, is always
subject to the condition that the property be devoted to the specific public purpose for
which it was taken. Corollarily, if this particular purpose or intent is not initiated or not
at all pursued, and is peremptorily abandoned, then the former owners, if they so
desire, may seek the reversion of the property, subject to the return of the amount of
just compensation received. In such a case, the exercise of the power of eminent
domain has become improper for lack of the required factual justification. [17]
Even without the foregoing declaration, in the instant case, on the question of whether
respondents were able to establish the existence of an oral compromise agreement
that entitled them to repurchase Lot No. 88 should the operations of
the Lahug Airport be abandoned, we rule in the affirmative.
It bears stressing that both the RTC, Branch 57, Cebu and the CA have passed upon
this factual issue and have declared, in no uncertain terms, that a compromise
agreement was, in fact, entered into between the Government and respondents, with
the former undertaking to resell Lot No. 88 to the latter if the improvement and
expansion of the Lahug Airport would not be pursued. In affirming the factual finding of
the RTC to this effect, the CA declared
Lozadas testimony is cogent. An octogenarian widower-retiree
and a resident of Moon Park, California since 1974, he testified
that government representatives verbally promised him and his
late wife while the expropriation proceedings were on-going that
the government shall return the property if the purpose for the
expropriation no longer exists. This promise was made at the
premises of the airport. As far as he could remember, there were
no expropriation proceedings against his property in 1952
because the first notice of expropriation he received was in
1962.Based on the promise, he did not hire a lawyer. Lozada was
firm that he was promised that the lot would be reverted to him
once the public use of the lot ceases. He made it clear that the
 verbal promise was made in Lahug with other lot owners before
the 1961 decision was handed down, though he could not name
the government representatives who made the promise. It was
just a verbal promise; nevertheless, it is binding. The fact that he
could not supply the necessary details for the establishment of his
assertions during cross-examination, but that When it will not be
used as intended, it will be returned back, we just believed in the
government, does not dismantle the credibility and truthfulness of
his allegation. This Court notes that he was 89 years old when he
testified in November 1997 for an incident which happened
decades ago. Still, he is a competent witness capable of
perceiving and making his perception known. The minor lapses
are immaterial. The decision of the competency of a witness rests
primarily with the trial judge and must not be disturbed on appeal
unless it is clear that it was erroneous. The objection to his
competency must be made before he has given any testimony or
as soon as the incompetency becomes apparent. Though Lozada
is not part of the compromise agreement,[18] he nevertheless
adduced sufficient evidence to support his claim.[19]
As correctly found by the CA, unlike in Mactan Cebu International Airport Authority v.
Court of Appeals,[20] cited by petitioners, where respondent therein offered testimonies
which were hearsay in nature, the testimony of Lozada was based on personal
knowledge as the assurance from the government was personally made to him. His
testimony on cross-examination destroyed neither his credibility as a witness nor the
truthfulness of his words.
Verily, factual findings of the trial court, especially when affirmed by the CA,
are binding and conclusive on this Court and may not be reviewed. A petition
for certiorariunder Rule 45 of the Rules of Court contemplates only questions of law
and not of fact.[21] Not one of the exceptions to this rule is present in this case to
warrant a reversal of such findings.
As regards the position of petitioners that respondents testimonial evidence violates
the Statute of Frauds, suffice it to state that the Statute of Frauds operates only with
respect to executory contracts, and does not apply to contracts which have been
completely or partially performed, the rationale thereof being as follows:
In executory contracts there is a wide field for fraud because
unless they be in writing there is no palpable evidence of the
intention of the contracting parties. The statute has precisely been
enacted to prevent fraud. However, if a contract has been totally
or partially performed, the exclusion of parol evidence would
promote fraud or bad faith, for it would enable the defendant to
keep the benefits already delivered by him from the transaction in
litigation, and, at the same time, evade the obligations,
responsibilities or liabilities assumed or contracted by him
thereby.[22]
In this case, the Statute of Frauds, invoked by petitioners to bar the claim of
respondents for the reacquisition of Lot No. 88, cannot apply, the oral compromise
settlement having been partially performed. By reason of such assurance made in
their favor, respondents relied on the same by not pursuing their appeal before the
CA. Moreover, contrary to the claim of petitioners, the fact of Lozadas eventual
conformity to the appraisal of Lot No. 88 and his seeking the correction of a clerical
error in the judgment as to the true area of Lot No. 88 do not conclusively establish
that respondents absolutely parted with their property. To our mind, these acts were
simply meant to cooperate with the government, particularly because of the oral
promise made to them.
The right of respondents to repurchase Lot No. 88 may be enforced based on a
constructive trust constituted on the property held by the government in favor of the
former. On this note, our ruling in Heirs of Timoteo Moreno is instructive, viz.:
Mactan-Cebu International Airport Authority is correct in stating
that one would not find an express statement in the Decision in
Civil Case No. R-1881 to the effect that the [condemned] lot
would return to [the landowner] or that [the landowner] had a right
to repurchase the same if the purpose for which it was
expropriated is ended or abandoned or if the property was to be
used other than as the Lahug Airport. This omission
notwithstanding, and while the inclusion of this pronouncement in
the judgment of condemnation would have been ideal, such
precision is not absolutely necessary nor is it fatal to the cause of
petitioners herein. No doubt, the return or repurchase of the
condemned properties of petitioners could be readily justified as
the manifest legal effect or consequence of the trial courts
underlying presumption that Lahug Airport will continue to be in
operation when it granted the complaint for eminent domain and
the airport discontinued its activities.
The predicament of petitioners involves a constructive trust, one
that is akin to the implied trust referred to in Art. 1454 of the Civil
Code, If an absolute conveyance of property is made in order to
secure the performance of an obligation of the grantor toward the
grantee, a trust by virtue of law is established. If the fulfillment of
the obligation is offered by the grantor when it becomes due, he
may demand the reconveyance of the property to him. In the case
at bar, petitioners conveyed Lots No. 916 and 920 to the
government with the latter obliging itself to use the realties for the
expansion of Lahug Airport; failing to keep its bargain, the
government can be compelled by petitioners to reconvey the
parcels of land to them, otherwise, petitioners would be denied
the use of their properties upon a state of affairs that was not
conceived nor contemplated when the expropriation was
authorized.
Although the symmetry between the instant case and the situation
contemplated by Art. 1454 is not perfect, the provision is
undoubtedly applicable. For, as explained by an expert on the law
of trusts: The only problem of great importance in the field of
constructive trust is to decide whether in the numerous and
varying fact situations presented to the courts there is a wrongful
holding of property and hence a threatened unjust enrichment of
the defendant. Constructive trusts are fictions of equity which are
bound by no unyielding formula when they are used by courts as
devices to remedy any situation in which the holder of legal title
may not in good conscience retain the beneficial interest.
In constructive trusts, the arrangement is temporary and passive
in which the trustees sole duty is to transfer the title and
possession over the property to the plaintiff-beneficiary. Of
course, thewronged party seeking the aid of a court of equity in
establishing a constructive trust must himself do
equity. Accordingly, the court will exercise its discretion in
deciding what acts are required of the plaintiff-beneficiary as
conditions precedent to obtaining such decree and has the
obligation to reimburse the trustee the consideration received
from the latter just as the plaintiff-beneficiary would if he
proceeded on the theory of rescission. In the good judgment of
the court, the trustee may also be paid the necessary expenses
he may have incurred in sustaining the property, his fixed costs
for improvements thereon, and the monetary value of his services
in managing the property to the extent that plaintiff-beneficiary will
secure a benefit from his acts.
The rights and obligations between the constructive trustee and
the beneficiary, in this case, respondent MCIAA and petitioners
over Lots Nos. 916 and 920, are echoed in Art. 1190 of the Civil
Code, When the conditions have for their purpose the
extinguishment of an obligation to give, the parties, upon the
fulfillment of said conditions, shall return to each other what they
have received x x x In case of the loss, deterioration or
improvement of the thing, the provisions which, with respect to the
debtor, are laid down in the preceding article shall be applied to
the party who is bound to return x x x.[23]
On the matter of the repurchase price, while petitioners are obliged to reconvey Lot
No. 88 to respondents, the latter must return to the former what they received as just
compensation for the expropriation of the property, plus legal interest to be computed
from default, which in this case runs from the time petitioners comply with their
obligation to respondents.
Respondents must likewise pay petitioners the necessary expenses they may have
incurred in maintaining Lot No. 88, as well as the monetary value of their services in
managing it to the extent that respondents were benefited thereby.
Following Article 1187[24] of the Civil Code, petitioners may keep whatever income or
fruits they may have obtained from Lot No. 88, and respondents need not account for
the interests that the amounts they received as just compensation may have earned in
the meantime.
In accordance with Article 1190[25] of the Civil Code vis--vis Article 1189, which
provides that (i)f a thing is improved by its nature, or by time, the improvement shall
inure to the benefit of the creditor x x x, respondents, as creditors, do not have to pay,
as part of the process of restitution, the appreciation in value of Lot No. 88, which is a
natural consequence of nature and time.[26]
WHEREFORE, the petition is DENIED. The February 28, 2006 Decision of the Court
of Appeals, affirming the October 22, 1999 Decision of the Regional Trial Court,
Branch 87, Cebu City, and its February 7, 2007 Resolution
are AFFIRMED with MODIFICATION as follows:
1. Respondents are ORDERED to return to petitioners the just compensation they
received for the expropriation of Lot No. 88, plus legal interest, in the case of default,
to be computed from the time petitioners comply with their obligation to reconvey Lot
No. 88 to them;
2. Respondents are ORDERED to pay petitioners the necessary expenses the latter
incurred in maintaining Lot No. 88, plus the monetary value of their services to the
extent that respondents were benefited thereby;
 3. Petitioners are ENTITLED to keep whatever fruits and income they may
have obtained from Lot No. 88; and
BERSAMIN, J.:

4. Respondents are also ENTITLED to keep whatever interests the amounts they
received as just compensation may have earned in the meantime, as well as the
appreciation in value of Lot No. 88, which is a natural consequence of nature and
time;
In light of the foregoing modifications, the case is REMANDED to the Regional Trial
Court, Branch 57, Cebu City, only for the purpose of receiving evidence on the
amounts that respondents will have to pay petitioners in accordance with this Courts
decision. No costs.
SO ORDERED.
The petitioners appeal the adverse decision promulgated on October 18, 2002[1] and
resolution promulgated on January 17, 2003,[2] whereby the Court of Appeals (CA)
reversed and set aside the order issued in their favor on February 19, 2002 by the
Regional Trial Court, Branch 214, in Mandaluyong City (RTC). [3] Thereby, the CA
upheld Resolution No. 552, Series of 1997, adopted by the City of Mandaluyong (City)
authorizing its then City Mayor to take the necessary legal steps for the expropriation
of the parcel of land registered in the names of the petitioners.
We affirm the CA.

Antecedents
THIRD DIVISION

The petitioners owned a parcel of land with an area of 1,044 square meters situated
between Nueve de Febrero Street and Fernandez Street in Barangay
SPOUSES ANTONIO and FE YUSAY, G.R. No. 156684 Mauway, MandaluyongCity. Half of their land they used as their residence, and the
rest they rented out to nine other families. Allegedly, the land was their only property
Petitioners, and only source of income.
Present:

On October 2, 1997, the Sangguniang Panglungsod of Mandaluyong City adopted

CARPIO MORALES, Chairperson, Resolution No. 552, Series of 1997, to authorize then City Mayor Benjamin S. Abalos,
Sr. to take the necessary legal steps for the expropriation of the land of the petitioners
-versus - BRION, for the purpose of developing it for low cost housing for the less privileged but
deserving city inhabitants. The resolution reads as follows:
BERSAMIN,
VILLARAMA, JR., and
RESOLUTION NO. 552, S-1997[4]
SERENO, JJ.
COURT OF APPEALS, CITY MAYOR
and CITY COUNCIL RESOLUTION AUTHORIZING HON. BENJAMIN S. ABALOS TO
Promulgated:
TAKE THE NECESSARY LEGAL STEPS FOR THE
OF MANDALUYONG CITY,
EXPROPRIATION OF A PARCEL OF LAND SITUATED ALONG
Respondents. DR.
April 6, 2011
JOSE FERNANDEZ STREET, BARANGAY MAUWAY, CITY
OF MANDALUYONG, OWNED BY MR. ANTONIO YUSAY
x-----------------------------------------------------------------------------------------x

WHEREAS, there is a parcel of land situated along Dr. Jose

RESOLUTION Fernandez Street, Barangay Mauway, City of Mandaluyong,
owned and registered in the name of MR. ANTONIO YUSAY;

WHEREAS, this piece of land have been occupied for about ten
(10) years by many financially hard-up families which the City
Government of Mandaluyong desires, among other things, to
provide modest and decent dwelling;
WHEREAS, the said families have already negotiated to acquire
this land but was refused by the above-named owner in total
disregard to the City Governments effort of providing land for the
landless;
WHEREAS, the expropriation of said land would certainly benefit
public interest, let alone, a step towards the implementation of
social justice and urban land reform in this City;
WHEREAS, under the present situation, the City Council deems it
necessary to authorize Hon. Mayor BENJAMIN S. ABALOS to
institute expropriation proceedings to achieve the noble purpose
of the City Government of Mandaluyong.
NOW, THEREFORE, upon motion duly seconded, the City
Council of Mandaluyong, in session assembled, RESOLVED, as it
hereby RESOLVES, to authorize, as it is hereby authorizing, Hon.
Mayor BENJAMIN S. ABALOS, to institute expropriation
proceedings against the above-named registered owner of that
parcel of land situated along Dr. Jose Fernandez Street,
Barangay Mauway, City of Mandaluyong, (f)or the purpose of
developing it to a low-cost housing project for the less privileged
but deserving constituents of this City.
ADOPTED on this 2nd day of October 1997 at the City
of Mandaluyong.
Sgd. Adventor R. Delos Santos
Acting Sanggunian Secretary
Attested: Approved:
Sgd. Roberto J. Francisco Sgd. Benjamin S. Abalos
City Councilor & Acting City Mayor
Presiding Officer
Notwithstanding that the enactment of Resolution No. 552 was but the initial step in
the Citys exercise of its power of eminent domain granted under Section 19 of
the Local Government Code of 1991, the petitioners became alarmed, and filed a
petition for certiorari and prohibition in the RTC, praying for the annulment of
Resolution No. 552 due to its being unconstitutional, confiscatory, improper, and
without force and effect.
The City countered that Resolution No. 552 was a mere authorization given to the City
Mayor to initiate the legal steps towards expropriation, which included making a
definite offer to purchase the property of the petitioners; hence, the suit of the
petitioners was premature.
On January 31, 2001, the RTC ruled in favor of the City and dismissed the petition for
lack of merit, opining that certiorari did not lie against a legislative act of the City
Government, because the special civil action of certiorari was only available to assail
judicial or quasi-judicial acts done without or in excess of jurisdiction, or with grave
abuse of discretion amounting to lack or excess of jurisdiction; that the special civil
action of prohibition did not also lie under the circumstances considering that the act of
passing the resolution was not a judicial, or quasi-judicial, or ministerial act; and that
notwithstanding the issuance of Resolution No. 552, the City had yet to commit acts of
encroachment, excess, or usurpation, or had yet to act without or in excess of
jurisdiction or with grave abuse of discretion amounting lack or in excess of
jurisdiction.
However, on February 19, 2002, the RTC, acting upon the petitioners motion for
reconsideration, set aside its decision and declared that Resolution No. 552 was null
and void.The RTC held that the petition was not premature because the passage of
Resolution No. 552 would already pave the way for the City to deprive the petitioners
and their heirs of their only property; that there was no due process in the passage of
Resolution No. 552 because the petitioners had not been invited to the subsequent
hearings on the resolution to enable them to ventilate their opposition; and that the
purpose for the expropriation was not for public use and the expropriation would not
benefit the greater number of inhabitants.
Aggrieved, the City appealed to the CA.
In its decision promulgated on October 18, 2002, the CA concluded that the
reversal of the January 31, 2001 decision by the RTC was not justified because
Resolution No. 552 deserved to be accorded the benefit of the presumption of
regularity and validity absent any sufficient showing to the contrary; that notice to the
petitioners (Spouses Yusay) of the succeeding hearings conducted by the City was
not a part of due process, for it was enough that their views had been consulted and
that they had been given the full opportunity to voice their protest; that to rule
otherwise would be to give every affected resident effective veto powers in law-making
by a local government unit; and that a public hearing, although necessary at times,
was not indispensable and merely aided in law-making.
The CA disposed as follows:
WHEREFORE, premises considered, the questioned order of the
Regional Trial Court, Branch 214, Mandaluyong City dated
February 19, 2002 in SCA Case No. 15-MD, which declared
Resolution No. 552, Series of 1997 of the City of Mandaluyong
null and void, is hereby REVERSED and SET ASIDE. No costs.
SO ORDERED.[5]
The petitioners moved for reconsideration, but the CA denied their motion. Thus, they
appeal to the Court, posing the following issues, namely:
1. Can the validity of Resolution No. 552 be assailed even
before its implementation?
2. Must a citizen await the takeover and possession of his
property by the local government before he can go to court
to nullify an unjust expropriation?
Before resolving these issues, however, the Court considers it necessary to
first determine whether or not the action for certiorari and prohibition commenced by
the petitioners in the RTC was a proper recourse of the petitioners.
Ruling
We deny the petition for review, and find that certiorari and prohibition were
not available to the petitioners under the circumstances. Thus, we sustain, albeit upon
different grounds, the result announced by the CA, and declare that the RTC gravely
erred in giving due course to the petition for certiorari and prohibition.
1.
Certiorari does not lie to assail the issuance of
a resolution by the Sanggunian Panglungsod
The special civil action for certiorari is governed by Rule 65 of
the 1997 Rules of Civil Procedure, whose Section 1 provides:
Section 1. Petition for certiorari. When any tribunal, board
or officer exercising judicial or quasi-judicial functions has acted
without or in excess of its or his jurisdiction, or with grave abuse
of discretion amounting to lack or excess of jurisdiction, and there
is no appeal, nor any plain, speedy, and adequate remedy in the
ordinary course of law, a person aggrieved thereby may file a
verified petition in the proper court, alleging the facts with
certainty and praying that judgment be rendered annulling or
modifying the proceedings of such tribunal, board or officer, and
granting such incidental reliefs as law and justice may require.
xxx
For certiorari to prosper, therefore, the petitioner must allege and establish
the concurrence of the following requisites, namely:
(a) The writ is directed against a tribunal, board, or
officer exercising judicial or quasi-judicial functions;
(b) Such tribunal, board, or officer has acted without or in excess
of jurisdiction, or with grave abuse of discretion amounting to
lack or excess of jurisdiction; and
(c) There is no appeal or any plain, speedy, and adequate remedy
in the ordinary course of law.[6]
 It is further emphasized that a petition for certiorari seeks solely to correct
defects in jurisdiction,[7] and does not correct just any error or mistake committed by a
court,board, or officer exercising judicial or quasi-judicial functions unless such
court, board, or officer thereby acts without jurisdiction or in excess of jurisdiction or
with such grave abuse of discretion amounting to lack of jurisdiction.[8]
The first requisite is that the respondent tribunal, board, or officer must be
exercising judicial or quasi-judicial functions. Judicial function, according to
Bouvier,[9] is the exercise of the judicial faculty or office; it also means the capacity to
act in a specific way which appertains to the judicial power, as one of the powers of
government. The term, Bouvier continues,[10] is used to describe generally those
modes of action which appertain to the judiciary as a department of organized
government, and through and by means of which it accomplishes its purpose and
exercises its peculiar powers.
Based on the foregoing, certiorari did not lie against the Sangguniang
Panglungsod, which was not a part of the Judiciary settling an actual controversy
involving legally demandable and enforceable rights when it adopted Resolution No.
552, but a legislative and policy-making body declaring its sentiment or opinion.
Nor did the Sangguniang Panglungsod abuse its discretion in adopting
Resolution No. 552. To demonstrate the absence of abuse of discretion, it is well to
differentiate between a resolution and an ordinance. The first is upon a specific matter
of a temporary nature while the latter is a law that is permanent in character.[11] No
rights can be conferred by and be inferred from a resolution, which is nothing but an
embodiment of what the lawmaking body has to say in the light of attendant
circumstances. In simply expressing its sentiment or opinion through the resolution,
therefore, the Sangguniang Panglungsod in no way abused its discretion, least of all
gravely, for its expression of sentiment or opinion was a constitutionally protected
right.
Moreover, Republic Act No. 7160 (The Local Government Code) required
the City to pass an ordinance, not adopt a resolution, for the purpose of initiating an
expropriation proceeding. In this regard, Section 19 of The Local Government
Code clearly provides, viz:
Section 19. Eminent Domain. A local government unit
may, through its chief executive and acting pursuant to an
ordinance, exercise the power of eminent domain for public use,
or purpose, or welfare for the benefit of the poor and the landless,
upon payment of just compensation, pursuant to the provisions of
the Constitution and pertinent laws: Provided, however, That the
power of eminent domain may not be exercised unless a valid
and definite offer has been previously made to the owner, and
such offer was not accepted: Provided, further, That the local
government unit may immediately take possession of the property
upon the filing of the expropriation proceedings and upon making
a deposit with the proper court of at least fifteen percent (15%) of
the fair market value of the property based on the current tax
declaration of the property to be expropriated: Provided, finally,
That, the amount to be paid for the expropriated property shall be
determined by the proper court, based on the fair market value at
the time of the taking of the property.
A resolution like Resolution No. 552 that merely expresses the sentiment of
the Sangguniang Panglungsod is not sufficient for the purpose of initiating an
expropriation proceeding. Indeed, in Municipality of Paraaque v. V.M. Realty
Corporation,[12] a case in which the Municipality of Paraaque based its complaint for
expropriation on a resolution, not an ordinance, the Court ruled so:
The power of eminent domain is lodged in the legislative
branch of government, which may delegate the exercise thereof
to LGUs, other public entities and public utilities. An LGU may
therefore exercise the power to expropriate private property only
when authorized by Congress and subject to the latters control
and restraints, imposed through the law conferring the power or in
other legislations. In this case, Section 19 of RA 7160, which
delegates to LGUs the power of eminent domain, also lays down
the parameters for its exercise. It provides as follows:
Section 19. Eminent Domain. A local
government unit may, through its chief executive and
acting pursuant to an ordinance, exercise the
power of eminent domain for public use, or purpose,
or welfare for the benefit of the poor and the
landless, upon payment of just compensation,
pursuant to the provisions of the Constitution and
pertinent laws: Provided, however, That the power of
eminent domain may not be exercised unless a valid
and definite offer has been previously made to the
owner, and such offer was not accepted: Provided,
further, That the local government unit may
immediately take possession of the property upon
the filing of the expropriation proceedings and upon
making a deposit with the proper court of at least
fifteen percent (15%) of the fair market value of the
property based on the current tax declaration of the
property to be expropriated: Provided, finally, That,
the amount to be paid for the expropriated property
 shall be determined by the proper court, based on
the fair market value at the time of the taking of the
property. (Emphasis supplied)
Thus, the following essential requisites must concur
before an LGU can exercise the power of eminent domain:
1. An ordinance is enacted by the local
legislative council authorizing the local chief
executive, in behalf of the LGU, to exercise the
power of eminent domain or pursue expropriation
proceedings over a particular private property.
2. The power of eminent domain is exercised for
public use, purpose or welfare, or for the benefit of
the poor and the landless.
3. There is payment of just compensation, as
required under Section 9 Article III of the Constitution
and other pertinent laws.
4. A valid and definite offer has been previously
made to the owner of the property sought to be
expropriated, but said offer was not accepted.
In the case at bar, the local chief executive sought to
exercise the power of eminent domain pursuant to a resolution of
the municipal council. Thus, there was no compliance with the
first requisite that the mayor be authorized through an
ordinance. Petitioner cites Camarines Sur vs. Court of Appeals to
show that a resolution may suffice to support the exercise of
eminent domain by an LGU. This case, however, is not in point
because the applicable law at that time was BP 337, the previous
Local Government Code, which had provided that a mere
resolution would enable an LGU to exercise eminent domain. In
contrast, RA 7160, the present Local Government Code which
was already in force when the Complaint for expropriation
was filed, explicitly required an ordinance for this purpose.
We are not convinced by petitioners insistence that the
terms resolution and ordinance are synonymous. A municipal
ordinance is different from a resolution. An ordinance is a
law, but a resolution is merely a declaration of the sentiment
or opinion of a lawmaking body on a specific matter. An
ordinance possesses a general and permanent character, but
a resolution is temporary in nature. Additionally, the two are
enacted differently -- a third reading is necessary for an
ordinance, but not for a resolution, unless decided otherwise
by a majority of all the Sanggunian members.
If Congress intended to allow LGUs to exercise eminent
domain through a mere resolution, it would have simply adopted
the language of the previous Local Government Code. But
Congress did not. In a clear divergence from the previous Local
Government Code, Section 19 of RA 7160 categorically requires
that the local chief executive act pursuant to an ordinance.Indeed,
[l]egislative intent is determined principally from the language of a
statute. Where the language of a statute is clear and
unambiguous, the law is applied according to its express terms,
and interpretation would be resorted to only where a literal
interpretation would be either impossible or absurd or would lead
to an injustice. In the instant case, there is no reason to depart
from this rule, since the law requiring an ordinance is not at all
impossible, absurd, or unjust.
Moreover, the power of eminent domain necessarily
involves a derogation of a fundamental or private right of the
people. Accordingly, the manifest change in the legislative
language from resolution under BP 337 to ordinance under RA
7160 demands a strict construction. No species of property is held
by individuals with greater tenacity, and is guarded by the
Constitution and laws more sedulously, than the right to the
freehold of inhabitants. When the legislature interferes with that
right and, for greater public purposes, appropriates the land of an
individual without his consent, the plain meaning of the law should
not be enlarged by doubtful interpretation.
xxx
In its Brief filed before Respondent Court, petitioner
argues that its Sangguniang Bayan passed an ordinance
on October 11, 1994 which reiterated its Resolution No. 93-35,
Series of 1993, and ratified all the acts of its mayor regarding the
subject expropriation.
 This argument is bereft of merit. In the first place,
petitioner merely alleged the existence of such an ordinance, but
it did not present any certified true copy thereof. In the second
place, petitioner did not raise this point before this Court. In fact, it
was mentioned by private respondent, and only in passing. In any
event, this allegation does not cure the inherent defect of
petitioners Complaint for expropriation filed on September 23,
1993. It is hornbook doctrine that:
x x x in a motion to dismiss based on the
ground that the complaint fails to state a cause of
action, the question submitted before the court for
determination is the sufficiency of the allegations in
the complaint itself. Whether those allegations are
true or not is beside the point, for their truth is
hypothetically admitted by the motion. The issue
rather is: admitting them to be true, may the court
render a valid judgment in accordance with the
prayer of the complaint?
The fact that there is no cause of action is evident
from the face of the Complaint for expropriation which was
based on a mere resolution. The absence of an ordinance
authorizing the same is equivalent to lack of cause of
action. Consequently, the Court of Appeals committed no
reversible error in affirming the trial courts Decision which
dismissed the expropriation suit.[13] (Emphasis supplied)
In view of the absence of the proper expropriation ordinance authorizing and
providing for the expropriation, the petition for certiorari filed in the RTC was
dismissible for lack of cause of action.
2.
Prohibition does not lie against expropriation
The special civil action for prohibition is governed also by Section 2 of Rule
65 of the 1997 Rules of Civil Procedure, which states:
Section 2. Petition for prohibition. When the proceedings
of any tribunal, corporation, board, officer or person, whether
exercising judicial, quasi-judicial or ministerial functions, are
without or in excess of its or his jurisdiction, or with grave abuse
of discretion amounting to lack or excess of jurisdiction, and there
is no appeal or any other plain, speedy, and adequate remedy in
the ordinary course of law, a person aggrieved thereby may file a
verified petition in the proper court, alleging the facts with
certainty and praying that judgment be rendered commanding the
respondent to desist from further proceedings in the action or
matter specified therein, or otherwise granting such incidental
reliefs as law and justice may require.
xxx
The function of prohibition is to prevent the unlawful and oppressive
exercise of legal authority and to provide for a fair and orderly administration of
justice.[14] The writ of prohibition is directed against proceedings that are done
without or in excess of jurisdiction, or with grave abuse of discretion, there being
no appeal or other plain, speedy and adequate remedy in the ordinary course of
law.[15] For grave abuse of discretion to be a ground for prohibition, the petitioner
must first demonstrate that the tribunal, corporation, board, officer, or person,
whether exercising judicial, quasi-judicial or ministerial functions, has exercised
its or his power in an arbitrary or despotic manner, by reason of passion or
personal hostility, which must be so patent and gross as would amount to an
evasion, or to a virtual refusal to perform the duty enjoined or to act in
contemplation of law.[16]On the other hand, the term excess of
jurisdiction signifies that the court, board, or officer has jurisdiction over a case
but has transcended such jurisdiction or acted without any authority. [17]
The petitioner must further allege in the petition and establish facts to show
that any other existing remedy is not speedy or adequate.[18] A remedy is plain, speedy
and adequate if it will promptly relieve the petitioner from the injurious effects of that
judgment and the acts of the tribunal or inferior court.[19]
The rule and relevant jurisprudence indicate that prohibition was not
available to the petitioners as a remedy against the adoption of Resolution No. 552,
for the Sangguniang Panglungsod, by such adoption, was not exercising judicial,
quasi-judicial or ministerial functions, but only expressing its collective sentiment or
opinion.
Verily, there can be no prohibition against a procedure whereby the
immediate possession of the land under expropriation proceedings may be taken,
provided always that due provision is made to secure the prompt adjudication and
payment of just compensation to the owner. This bar against prohibition comes from
the nature of the power of eminent domain as necessitating the taking of private land
intended for public use,[21] and the interest of the affected landowner is thus made
subordinate to the power of the State. Once the State decides to exercise its power of
eminent domain, the power of judicial review becomes limited in scope, and the courts
will be left to determine the appropriate amount of just compensation to be paid to the
affected landowners. Only when the landowners are not given their just compensation
for the taking of their property or when there has been no agreement on the amount of
just compensation may the remedy of prohibition become available.
Here, however, the remedy of prohibition was not called for, considering that
only a resolution expressing the desire of the Sangguniang Panglungsod to
expropriate the petitioners property was issued. As of then, it was premature for the
petitioners to mount any judicial challenge, for the power of eminent domain could be
exercised by the City only through the filing of a verified complaint in the proper
court. Before the City as the expropriating authority filed such verified complaint, no
expropriation proceeding could be said to exist. Until then, the petitioners as the
owners could not also be deprived of their property under the power of eminent
domain.
WHEREFORE, we affirm the decision promulgated on October 18, 2002 in
CA-G.R. SP No. 70618.
THIRD DIVISION
G.R. No. 104786 January 27, 1994
ALFREDO PATALINGHUG, petitioner,
vs.
HON. COURT OF APPEALS, RICARDO CRIBILLO, MARTIN ARAPOL, CORAZON
ALCASID, PRIMITIVA SEDO, respondents.
Gonzales, Batiller, Bilog & Associates for petitioner.
Garcilaso F. Vega for private respondents.
ROMERO, J.:
In the case before us, we are called upon to decide whether or not petitioner's
operation of a funeral home constitutes permissible use within a particular district or
zone in Davao City.
On November 17, 1982, the Sangguniang Panlungsod of Davao City enacted
Ordinance No. 363, series of 1982 otherwise known as the "Expanded Zoning
Ordinance of Davao City," Section 8 of which states:
Sec. 8. USE REGULATIONS IN C-2 DISTRICTS (Shaded light
red in the Expanded Zoning Map) AC-2 District shall be
dominantly for commercial and compatible industrial uses as
provided hereunder:
xxx xxx xxx
xxx xxx xxx
3.1 Funeral Parlors/Memorial Homes with adequate off street
parking space (see parking standards of P.D. 1096) and provided
that they shall be established not less than 50 meters from any
residential structures, churches and other institutional buildings.
(Emphasis provided)
Upon prior approval and certification of zoning compliance by Zoning Administrator
issued on February 10, 1987 Building Permit No. 870254 in favor of petitioner for the
construction of a funeral parlor in the name and style of Metropolitan Funeral Parlor at
Cabaguio Avenue, Agdao, Davao City.
Thereafter, petitioner commenced the construction of his funeral parlor.
Acting on the complaint of several residents of Barangay Agdao, Davao City that the
construction of petitioner's funeral parlor violated Ordinance
No. 363, since it was allegedly situated within a 50-meter radius from the Iglesia ni
Kristo Chapel and several residential structures, the Sangguniang Panlungsod
conducted an investigation and found that "the nearest residential structure, owned by
Wilfred G. Tepoot is only 8 inches to the south. . . . ." 1
Notwithstanding the findings of the Sangguniang Panlungsod, petitioner continued to
construct his funeral parlor which was finished on November 3, 1987.
Consequently, private respondents filed on September 6, 1988 a case for the
declaration of nullity of a building permit with preliminary prohibitory and mandatory
injunction and/or restraining order with the trial court. 2
After conducting its own ocular inspection on March 30, 1989, the lower court, in its
order dated July 6, 1989, dismissed the complaint based on the following findings: 3
1. that the residential building owned by Cribillo and Iglesia ni
Kristo chapel are 63.25 meters and 55.95 meters away,
respectively from the funeral parlor.
2. Although the residential building owned by certain
Mr. Tepoot is adjacent to the funeral parlor, and is only separated
therefrom by a concrete fence, said residential building is being
rented by a certain Mr. Asiaten who actually devotes it to his
laundry business with machinery thereon.
3. Private respondent's suit is premature as they failed to exhaust
the administrative remedies provided by Ordinance No. 363.
Hence, private respondents appealed to the Court of Appeals. (CA G.R. No. 23243).
In its decision dated November 29, 1991, the Court of Appeals reversed the lower
court by annulling building permit No. 870254 issued in favor of petitioner. 4 It ruled
that although the buildings owned by Cribillo and Iglesia ni Kristo were beyond the 50-
meter residential radius prohibited by Ordinance 363, the construction of the funeral
parlor was within the 50-meter radius measured from the Tepoot's building. The
Appellate Court disagreed with the lower court's determination that Tepoot's building
was commercial and ruled that although it was used by Mr. Tepoot's lessee for assessed by the provincial or city assessor as commercial because its actual use is
laundry business, it was a residential lot as reflected in the tax declaration, thus paving commercial.
the way for the application of Ordinance No. 363.
The trial court's determination that Mr. Tepoot's building is commercial and, therefore,
Hence, this appeal based on the following grounds: Sec. 8 is inapplicable, is strengthened by the fact that the Sangguniang Panlungsod
has declared the questioned area as commercial or
The Respondent Court of Appeals erred in concluding that the C-2. Consequently, even if Tepoot's building was declared for taxation purposes as
Tepoot building adjacent to petitioner's funeral parlor is residential residential, once a local government has reclassified an area as commercial, that
simply because it was allegedly declared as such for taxation determination for zoning purposes must prevail. While the commercial character of the
purposes, in complete disregard of Ordinance No. 363 (The questioned vicinity has been declared thru the ordinance, private respondents have
Expanded Zoning Ordinance of Davao City) declaring the subject failed to present convincing arguments to substantiate their claim that Cabaguio
area as dominantly for commercial and compatible industrial Avenue, where the funeral parlor was constructed, was still a residential zone.
uses. Unquestionably, the operation of a funeral parlor constitutes a "commercial purpose,"
We reverse the Appellate Court and reinstate the ruling of the lower court that as gleaned from Ordinance No. 363.
petitioner did not violate Section 8 of Davao City Ordinance No. 363. It must be The declaration of the said area as a commercial zone thru a municipal ordinance is
emphasized that the question of whether Mr. Tepoot's building is residential or not is a an exercise of police power to promote the good order and general welfare of the
factual determination which we should not disturb. As we have repeatedly enunciated, people in the locality. Corollary thereto, the state, in order to promote the general
the resolution of factual issues is the function of the lower courts where findings on welfare, may interfere with personal liberty, with property, and with business and
these matters are received with respect and are in fact binding on this court, except occupations.10 Thus, persons may be subjected to certain kinds of restraints and
only where the case is shown as coming under the accepted exceptions. 5 burdens in order to secure the general welfare of the state and to this fundamental aim
Although the general rule is that factual findings of the Court of Appeals are conclusive of government, the rights of the individual may be subordinated. The ordinance which
on us, 6 this admits of exceptions as when the findings or conclusions of the Court of regulates the location of funeral homes has been adopted as part of comprehensive
Appeals and the trial court are contrary to each other. 7 While the trial court ruled that zoning plans for the orderly development of the area covered thereunder.
Tepoot's building was commercial, the Appellate Court ruled otherwise. Thus we see WHEREFORE, the decision of the Court of Appeals dated November 29, 1991 is
the necessity of reading and examining the pleadings and transcripts submitted before hereby REVERSED and the order dated July 6, 1989 of the Regional Trial Court of
the trial court. Davao City is REINSTATED.
In the case at bar, the testimony of City Councilor Vergara shows that Mr. Tepoot's SO ORDERED.
building was used for a dual purpose both as a dwelling and as a place where a
laundry business was conducted. 8 But while its commercial aspect has been
established by the presence of machineries and laundry paraphernalia, its use as a
residence, other than being declared for taxation purposes as such, was not fully
substantiated.
The reversal by the Court of Appeals of the trial court's decision was based on
Tepoot's building being declared for taxation purposes as residential. It is our
considered view, however, that a tax declaration is not conclusive of the nature of the
property for zoning purposes. A property may have been declared by its owner as
residential for real estate taxation purposes but it may well be within a commercial
zone. A discrepancy may thus exist in the determination of the nature of property for
real estate taxation purposes vis-a-vis the determination of a property for zoning
purposes.
Needless to say, even if we are to examine the evidentiary value of a tax declaration
under the Real Property Tax Code, a tax declaration only enables the assessor to
identify the same for assessment levels. In fact, a tax declaration does not bind a
provincial/city assessor, for under Sec. 22 of the Real Estate Tax Code, 9 appraisal
and assessment are based on the actual use irrespective of "any previous
assessment or taxpayer's valuation thereon," which is based on a taxpayer's
declaration. In fact, a piece of land declared by a taxpayer as residential may be