The private respondent, Malate Tourist Development Corporation (MTDC)

is a corporation engaged in the business of operating hotels, motels, hostels

and lodging houses. It built and opened Victoria Court in Malate which was
[5]

licensed as a motel although duly accredited with the Department of Tourism

as a hotel.
On March 30, 1993, city Mayor Lim enacted An ordinance PROHIBITING
THE ESTABLISHMENT OR OPERATION OF BUSINESSES
PROVIDING CERTAIN FORMS OF AMUSEMENT, ENTERTAINMENT,
SERVICES AND FACILITIES IN THE ERMITA-MALATE AREA,
PRESCRIBING PENALTIES FOR VIOLATION THEREOF, AND FOR
OTHER PURPOSES. The Ordinance prohibited the
establishment of sauna parlors, massage parlors, karaoke
bars, beerhouses, night clubs, day clubs, cabarets, motels,
inns.Operaators are required to close their operations within 3 months andand

afterwhich, violators will be penalized for 1 year of imprisonment and

Php5000 penalty.
On June 28, 1993 - MTDC filed a Petition with the lower court ,
praying that the Ordinance be declared invalid, arguing that the
ordinance erroneously included lawful establishments such as motels and
inns. MDTC further claimed that th not a valid exercise of police
power and it constitutes a denial of equal protection under the law.

Judge Laguio favored MDTC hence, the case was raised to the
Supreme Court.

Legal Issues:

WON the ordinance is an invalid exercise of police power against

individual property rights

WON the ordinance violates equal protection of the laws.

Held:

1. Yes.

It is readily apparent that the means employed by the Ordinance for the
achievement of its purposes, infringes on the constitutional guarantees of a
persons fundamental right to liberty and property.

The Constitution expressly provides in Article III, Section 9, that private

property shall not be taken for public use without just compensation. 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. If the government takes
away a persons 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]

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 which amounts to
an interference into personal and private rights.
2. Equal protection requires that all persons or things similarly situated
should be treated alike, both as to rights conferred and responsibilities
imposed. As stated in Article III of the Constitution:
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.
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.
In the Courts 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.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.

Wherefore, the petition was DENIED and the decision of the

RTC was AFFIRMED.