City of Manila vs.

Laguio
April 12, 2005 Ponente: Tinga Mara
SUMMARY: Malate Tourist Development Corporation petitioned against the Ordinance issued by the City of Manila which tries to curtail activities in Ermita Manila. , MTDC argued that the Ordinance erroneously and improperly included in its enumeration of prohibited establishments, motels and inns such as MTDCs ictoria Court and contested the constitutionality of such ordinance. !espondent city of Manila protests the ruling of the !TC by "udge #aguio which states that it was unconstitutional. $C upheld !TC. DOCTRINE: The tests of a valid ordinance are well established. % long line of decisions has held that for an ordinance to be valid, it must not only be within the corporate powers of the local government unit to enact and must be passed according to the procedure prescribed by law, it must also conform to the following substantive re&uirements' ()* must not contravene the Constitution or any statute+ (,* must not be unfair or oppressive+ (-* must not be partial or discriminatory+ (.* must not prohibit but may regulate trade+ (/* must be general and consistent with public policy+ and (0* must not be unreasonable. FACTS: 1rivate respondent Malate Tourist Development Corporation (MTDC* is a corporation engaged in the business of operating hotels, motels, hostels and lodging houses. 2t built and opened ictoria Court in Malate which was licensed as a motel although duly accredited with the Department of Tourism as a hotel. 3On ,4 "une )55-, MTDC filed a Petition for Declaratory Relief with Prayer for a Writ of Preli inary !n"#nction and$or Te porary Re%training Order 367 &RT' Petition( with the lower court impleading as defendants, herein petitioners City of Manila, 8on. %lfredo $. #im (#im*, 8on. "oselito #. %tien9a, and the members of the City Council of Manila (City Council*. MTDC prayed that the Ordinance, insofar as it includes motels and inns as among its prohibited establishments, be declared invalid and unconstitutional %: O!D2:%:CE 1!O82;2T2:< T8E E$T%;#2$8ME:T O! O1E!%T2O: O= ;>$2:E$$E$ 1!O 2D2:< CE!T%2: =O!M$ O= %M>$EME:T, E:TE!T%2:ME:T,

$E! 2CE$ %:D =%C2#2T2E$ 2: T8E E!M2T%?M%#%TE %!E%, 1!E$C!2;2:< 1E:%#T2E$ =O! 2O#%T2O: T8E!EO=, %:D =O! OT8E! 1>!1O$E$) 2n the RT' Petition, MTDC argued that the Ordinance erroneously and improperly included in its enumeration of prohibited establishments, motels and inns such as MTDCs ictoria Court considering that these were not establishments for @amusementA or @entertainmentA and they were not @services or facilities for entertainment,A nor did they use women as @tools for entertainment,A and neither did they @disturb the community,A @annoy the inhabitantsA or @adversely affect the social and moral welfare of the community

1 $ECT2O: ). %ny provision of eBisting laws and ordinances to the contrary

notwithstanding, no p !son" pa!tn !s#ip" $o!po!ation o! ntity s#all" in t# E!%ita& Malat a! a bounded by Teodoro M. Calaw $r. $treet in the :orth, Taft %venue in the East, ito Cru9 $treet in the $outh and !oBas ;oulevard in the Dest, pursuant to 1.D. .55 ' allo( ) o! aut#o!i* ) to $ont!a$t an) ngag in" any 'usin ss p!ovi)ing $ !tain fo!%s of a%us % nt" nt !tain% nt" s !vi$ s an) fa$iliti s (# ! (o% n a! us ) as tools in nt !tain% nt an) (#i$# t n) to )istu!' t# $o%%unity" annoy t# in#a'itants" an) a)v !s ly aff $t t# so$ial an) %o!al ( lfa! of t# $o%%unity" such as but not limited to' ). $auna 1arlors ,. Massage 1arlors -. CaraoEe ;ars .. ;eerhouses /. :ight Clubs 0. Day Clubs 6. $uper Clubs 4. Discothe&ues 5. Cabarets )F. Dance 8alls )). Motels ),. 2nns $EC. , T# City Mayo!" t# City T! asu! ! or any person acting in behalf of the said officials a! p!o#i'it ) f!o% issuing p !%its" t %po!a!y o! ot# !(is " o! f!o% g!anting li$ ns s an) a$$ pting pay% nts fo! t# op !ation of 'usin ss nu% !at ) in t# p! $ )ing s $tion. $EC. -. O(n !s an)+o! op !ato! of sta'lis#% nts engaged in, or devoted to, the businesses enumerated in $ection ) hereof are hereby giv n t#! ,-. %ont#s f!o% t# )at of app!oval of t#is o!)inan$ (it#in (#i$# to (in) up 'usin ss op !ations o! to t!ansf ! to any pla$ outsi) of t# E!%ita&Malat a! a o! $onv !t sai) 'usin ss s to ot# ! /in)s of 'usin ss allo(a'l (it#in t# a! a" such as but not limited to' ). ,. -. .. Curio or anti&ue shop $ouvenir $hops 8andicrafts display centers %rt galleries

MTDC further advanced that the Ordinance was invalid and unconstitutional for the following reasons' ()* The City Council has no power to prohibit the operation of motels as $ection ./4 (a* . (iv*3),7 of the #ocal <overnment Code of )55) (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+ (,* The Ordinance is void as it is violative of 1residential Decree (1.D.* :o. .553)-7 which specifically declared portions of the Ermita?Malate area as a commercial 9one with certain restrictions+ (-* The Ordinance does not constitute a proper eBercise of police power as the compulsory closure of the motel business has no reasonable relation to the legitimate municipal interests sought to be protected+ (.* The Ordinance constitutes an eB post facto law by punishing the operation of ictoria Court which was a legitimate business prior to its enactment+ (/* The Ordinance violates MTDCs constitutional rights in that' (a* it is confiscatory and constitutes an invasion of plaintiffs 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 eBtraGudicially destroy it+ and (0* The Ordinance constitutes a denial of e&ual protection under the law as no reasonable basis eBists for prohibiting the operation of motels and inns, but not
/. !ecords and music shops 0. !estaurants 6. Coffee shops 4. =lower shops 5. Music lounge and sing?along restaurants, with well?defined activities for wholesome family entertainment that cater to both local and foreign clientele. )F. Theaters engaged in the eBhibition, not only of motion pictures but also of cultural shows, stage and theatrical plays, art eBhibitions, concerts and the liEe. )). ;usinesses allowable within the law and medium intensity districts as provided for in the 9oning ordinances for Metropolitan Manila, eBcept new warehouse or open?storage depot, docE or yard, motor repair shop, gasoline service station, light industry with any machinery, or funeral establishments. $EC. .. Any p !son violating any p!ovisions of t#is o!)inan$ " s#all upon $onvi$tion" ' punis# ) 'y i%p!ison% nt of on ,0. y a! o! fin of FI1E T2OUSAND ,34"555.55. 3ESOS" o! 'ot#, at the discretion of the Court, 1!O 2DED, that in case of Guridical person, the 1resident, the <eneral Manager, or person?in?charge of operation shall be liable thereof+ 1!O 2DED =>!T8E!, that in $as of su's 6u nt violation an) $onvi$tion" t# p! %is s of t# !!ing sta'lis#% nt s#all ' $los ) an) pa)lo$/ ) p !%an ntly. SEC. 5. This ordinance shall take effect upon approval. ---------------------------------------------------------------------------------------------------------------------------------------------

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. 2n their %nswer dated ,- "uly )55-, petitioners City of Manila and #im 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 communityA as provided for in $ection ./4 (a* . (vii* of the #ocal <overnment Code, 1etitioners liEewise asserted that the Ordinance was enacted by the City Council of Manila to protect the social and moral welfare of the community in conGunction with its police power as found in %rticle 222, $ection )4(EE* of !epublic %ct :o. .F5, otherwise Enown as the !evised Charter of the City of Manila (!evised Charter of Manila (EE* 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 fiB penalties for the violation of ordinances which shall not eBceed two hundred pesos fine or siB months imprisonment, or both such fine and imprisonment, for a single offense. The petitioners noted, the Ordinance had the presumption of validity+ hence, private respondent had the burden to prove its illegality or unconstitutionality.

S $tion 748. 3o( !s" Duti s" Fun$tions an) Co%p nsation . (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 $ection )0 of this Code and in the proper eBercise of the corporate powers of the city as provided for under $ection ,, of this Code, and shall' .... (.* !egulate 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* !egulate 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 re&uire 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.

1etitioners also maintained that there was no inconsistency between 1.D. .55 and the Ordinance as the latter simply disauthori9ed certain forms of businesses and allowed the Ermita?Malate area to remain a commercial 9one. The Ordinance, the petitioners liEewise claimed, cannot be assailed as e) po%t facto as it was prospective in operation. The Ordinance also did not infringe the e&ual protection clause and cannot be denounced as class legislation as there eBisted substantial and real differences between the Ermita?Malate area and other places in the City of Manila On ,4 "une )55-, respondent "udge 1erfecto %.$. #aguio, "r. ("udge #aguio* issued an eB?parte temporary restraining order against the enforcement of the Ordinance %nd on )0 "uly )55-, again in an intrepid gesture, he granted the writ of preliminary inGunction prayed for by MTDC. %fter trial, on ,/ :ovember )55., "udge #aguio rendered the assailed Deci%ion, enGoining the petitioners from implementing the Ordinance. The dispositive portion of said Deci%ion reads' D8E!E=O!E, Gudgment is hereby rendered declaring Ordinance :o. 6643-7, $eries of )55-, of the City of Manila null and void, and maEing permanent the writ of preliminary inGunction that had been issued by this Court against the defendant. :o costs ISSUES+2ELD: ). DO: the Ordinance is ultra vires, otherwise unfair, unreasonable and oppressive eBercise of police power. The Ordinance i% %o replete with con%tit#tional infir itie% that al o%t e*ery %entence thereof *iolate% a con%tit#tional pro*i%ion+ The prohi,ition% and %anction% therein tran%gre%% the cardinal right% of per%on% en%hrined ,y the 'on%tit#tion+ The 'o#rt i% called #pon to %helter the%e right% fro atte pt% at rendering the worthle%%+ RATIO: The tests of a valid ordinance are well established. % 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 re&uirements' ()* must not contravene the Constitution or any statute+ (,* must not be unfair or oppressive+ (-* must not be partial or discriminatory+ (.* must not prohibit but may regulate trade+ (/* must be general and consistent with public policy+ and (0* must not be unreasonable. The Ordinance was passed by the City Council in the eBercise of its police power, an enactment of the City Council acting as agent of Congress. This delegated police power is found in $ection )0 of the #<C, Enown as the general welfare clause.

The in&uiry in this 1etition is concerned with the validity of the eBercise of such delegated power. %. The Ordinance contravenes the Constitution The enactment of the Ordinance was an invalid eBercise of delegated power as it is unconstitutional and repugnant to general laws. The police power granted to #<>s must always be eBercised with utmost observance of the rights of the people to due process and e&ual protection of the law. Due process re&uires the intrinsic validity of the law in interfering with the rights of the person to his life, liberty and property. !e&uisites for the valid eBercise of 1olice 1ower are not met To successfully invoEe the eBercise 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, re&uire 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.0F 2t must be evident that no other alternative for the accomplishment of the purpose less intrusive of private rights can worE. % reasonable relation must eBist 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. #acEing a concurrence of these two re&uisites, the police measure shall be strucE down as an arbitrary intrusion into private rights a violation of the due process clause. The obGect of the Ordinance was, accordingly, the promotion and protection of the social and moral values of the community. <ranting for the saEe of argument that the obGectives of the Ordinance are within the scope of the City Councils police powers, the means employed for the accomplishment thereof were unreasonable and unduly oppressive. The worthy aim of fostering public morals and the eradication of the communitys 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 @allowedA under the Ordinance have no reasonable relation to the accomplishment of its purposes. Otherwise stated, the prohibition of the enumerated establishments will not per se protect 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 seBual disease in Manila.

The enumerated establishments are lawful pursuits which are not per se offensive to the moral welfare of the community. Dhile a motel may be used as a venue for immoral seBual activity, it cannot for that reason alone be punished. 2t cannot be classified as a house of ill?repute or as a nuisance per se on a mere liEelihood or a naEed assumption. 2f 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 eBercise its authority to suspend or revoEe their licenses for these violations+ and it may even impose increased license fees. 2n other words, there are other means to reasonably accomplish the desired end. 2t 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 persons fundamental right to liberty and property. Modality employed is unlawful taEing 2t is 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 recogni9ed as a taEing of the property without Gust compensation.64 2t is intrusive and violative of the private property rights of individuals. There are two different types of taEing that can be identified. % @possessoryA taEing occurs when the government confiscates or physically occupies property. % @regulatoryA taEing occurs when the governments regulation leaves no reasonable economically viable use of the property. Dhat is crucial in Gudicial consideration of regulatory taEings is that government regulation is a taEing if it leaves no reasonable economically viable use of property in a manner that interferes with reasonable eBpectations for use. Dhen 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 taEing. The Ordinance gives the owners and operators of the @prohibitedA establishments three (-* 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 Einds of business allowable within the area.A The directive to @wind up business operationsA amounts to a closure of the establishment, a permanent deprivation of property, and is practically confiscatory. >nless the owner converts his establishment to accommodate an @allowedA business, the structure which housed the previous business will be left empty and gathering dust. 2t is apparent that the Ordinance leaves no reasonable economically viable use of property in a manner that interferes with reasonable eBpectations for use.

The second and third options to transfer to any place outside of the Ermita? Malate area or to convert into allowed businesses are confiscatory as well. The penalty of permanent closure in cases of subse&uent violations found in $ection . of the Ordinance is also e&uivalent to a @taEingA of private property. 1etitioners cannot taEe refuge in classifying the measure as a 9oning ordinance. % 9oning ordinance, although a valid eBercise of police power, which limits a @wholesomeA property to a use which can not reasonably be made of it constitutes the taEing of such property without Gust compensation. 1rivate property which is not noBious nor intended for noBious purposes may not, by 9oning, be destroyed without compensation. $uch principle finds no support in the principles of Gustice as we Enow them. The police powers of local government units which have always received broad and liberal interpretation cannot be stretched to cover this particular taEing. =urther, The Ordinance confers upon the mayor arbitrary and unrestricted power to close down establishments. Ordinances such as this, which maEe possible abuses in its eBecution, depending upon no conditions or &ualifications 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. $imilarly, the Ordinance does not specify the standards to ascertain which establishments @tend to disturb the community,A @annoy the inhabitants,A and @adversely affect the social and moral welfare of the community.A The cited case supports the nullification of the Ordinance for lacE of comprehensible standards to guide the law enforcers in carrying out its provisions. 1etitioners 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. ;. The Ordinance violates E&ual 1rotection Clause 2n the Courts view, there are no substantial distinctions between motels, inns, pension houses, hotels, lodging houses or other similar establishments. ;y definition, all are commercial establishments providing lodging and usually meals and other services for the public. :o reason eBists 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 subGects are not similarly treated, both as to rights conferred and obligations imposed. 2t is arbitrary as it does not rest on substantial distinctions bearing a Gust and fair relation to the purpose of the Ordinance.

The Court liEewise cannot see the logic for prohibiting the business and operation of motels in the Ermita?Malate area but not outside of this area. % noBious establishment does not become any less noBious if located outside the area. The standard @where women are used as tools for entertainmentA is also discriminatory as prostitutionone of the hinted ills the Ordinance aims to banishis not a profession eBclusive to women. ;oth men and women have an e&ual propensity to engage in prostitution. Thus, the discrimination is invalid. C. The Ordinance is repugnant to general laws+ it is ultra vires The Ordinance is in contravention of the Code ($ec ./4* as the latter merely empowers local government units to regulate, and not prohibit, the establishments enumerated in $ection ) thereof. Dith 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. 2t is well to point out that petitioners also cannot seeE cover under the general welfare clause authori9ing the abatement of nuisances without Gudicial 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. 2t can not be said that motels are inGurious to the rights of property, health or comfort of the community. 2t is a legitimate business. 2f it be a nuisance per accidens it may be so proven in a hearing conducted for that purpose. % motel is not per se a nuisance warranting its summary abatement without Gudicial intervention. :ot only does the Ordinance contravene the Code, it liEewise runs counter to the provisions of 1.D. .55. %s 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 Einds of commercial establishments eBcept 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.