Vicente Dela Cruz et al v.
Paras
Subject Shall Be Expressed in the Title – Police Power Not Validly Exercise
FACTS:Vicente De La Cruz et al were club & cabaret operators. They assail
the constitutionality of Ord. No. 84, Ser. of 1975 or the Prohibition and Closure
Ordinance of Bocaue, Bulacan. De la Cruz averred that the said Ordinance
violates their right to engage in a lawful business for the said ordinance would
close out their business. That the hospitality girls they employed are healthy
and are not allowed to go out with customers. Judge Paras however lifted the
TRO he earlier issued against Ord. 84 after due hearing declaring that Ord 84.
is constitutional for it is pursuant to RA 938 which reads “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”. Paras ruled that the prohibition is a valid
exercise of police power to promote general welfare. De la Cruz then appealed
citing that they were deprived of due process.
ISSUE: Whether or not a municipal corporation, Bocaue, Bulacan can, prohibit
the exercise of a lawful trade, the operation of night clubs, and the pursuit of a
lawful occupation, such clubs employing hostesses pursuant to Ord 84 which
is further in pursuant to RA 938.
HELD: The SC ruled against Paras. If night clubs were merely then regulated
and not prohibited, certainly the assailed ordinance would pass the test of
validity. SC 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. Pursuant to the title of the Ordinance, Bocaue should and can only
regulate not prohibit the business of cabarets.
Binay vs Domingo Case Digest
Facts:
Petitioner Municipality of Makati, through its Council, approved Resolution No.
60 which extends P500 burial assistance to bereaved families whose gross
family income does not exceed P2,000.00 a month. The funds are to be taken
out of the unappropriated available funds in the municipal treasury. The Metro
Manila Commission approved the resolution. Thereafter, the municipal
secretary certified a disbursement of P400,000.00 for the implementation of the
program. However, the Commission on Audit disapproved said resolution and
the disbursement of funds for the implementation thereof for the following
reasons: (1) the resolution has no connection to alleged public safety, general
welfare, safety, etc. of the inhabitants of Makati; (2) government funds must be
disbursed for public purposes only; and, (3) it violates the equal protection
clause since it will only benefit a few individuals.
Issues:
1. Whether Resolution No. 60 is a valid exercise of the police power under the
general welfare clause
2. Whether the questioned resolution is for a public purpose
3. Whether the resolution violates the equal protection clause
Held:
1. 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. 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.
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.
2. 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. Thus, it is deemed inadvisable to attempt to frame any definition
which shall absolutely indicate the limits of police power.
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, the promotion of the general
welfare, social justice as well as human dignity and respect for human
rights." 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.
3. There is no violation of the equal protection clause. 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. (Binay vs Domingo, G.R. No. 92389, September 11, 1991)
Tano vs Socrates
FACTS:
On Dec 15, 1992, the Sangguniang Panglungsod ng Puerto Princesa enacted
an ordinance banning the shipment of all live fish and lobster outside Puerto
Princesa City from January 1, 1993 to January 1, 1998. Subsequently the
Sangguniang Panlalawigan, Provincial Government of Palawan enacted a
resolution prohibiting the catching , gathering, possessing, buying, selling, and
shipment of a several species of live marine coral dwelling aquatic organisms
for 5 years, in and coming from Palawan waters.
Petitioners filed a special civil action for certiorari and prohibition, praying that
the court declare the said ordinances and resolutions as unconstitutional on the
ground that the said ordinances deprived them of the 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.
ISSUE:
Are the challenged ordinances unconstitutional?
HELD:
No. The Supreme Court found the petitioners contentions baseless and held
that the challenged ordinances did not suffer from any infirmity, both under the
Constitution and applicable laws. There is absolutely no showing that any of
the petitioners qualifies as a subsistence or marginal fisherman. 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 nation’s
marine wealth. 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.
In addition, one of the devolved powers of the LCG on devolution is the
enforcement of fishery laws in municipal waters including the conservation of
mangroves. This necessarily includes the enactment of ordinances to
effectively carry out such fishery laws within the municipal waters. In light of the
principles of decentralization and devolution enshrined in the LGC and the
powers granted therein to LGUs which unquestionably involve the exercise of
police power, the validity of the questioned ordinances cannot be doubted.
WHITE LIGHT CORPORATION, TITANIUM CORPORATION and STA.
MESA TOURIST & DEVELOPMENT CORPORATION, Petitioners,
vs. CITY OF MANILA, represented by DE CASTRO, MAYOR ALFREDO S.
LIM,Respondent.
Facts:
On December 3, 1992, City Mayor Alfredo S. Lim signed into law 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).” The ordinance sanctions any person or corporation
who will allow the admission and charging of room rates for less than 12 hours
or the renting of rooms more than twice a day.
The petitioners White Light Corporation (WLC), Titanium Corporation (TC), and
Sta. Mesa Tourist and Development Corporation (STDC), who own and
operate several hotels and motels in Metro Manila, filed a motion to intervene
and to admit attached complaint-in-intervention on the ground that the
ordinance will affect their business interests as operators. The respondents, in
turn, alleged that the ordinance is a legitimate exercise of police power.
RTC declared Ordinance No. 7774 null and void as it “strikes at the personal
liberty of the individual guaranteed and jealously guarded by the Constitution.”
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. Finally, from the observation that the illicit
relationships the Ordinance sought to dissuade could nonetheless be
consummated by simply paying for a 12-hour stay,
When elevated to CA, the respondents 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 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. Also, they contended
that under Art III Sec 18 of Revised Manila Charter, they have the power 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 to fix penalties for the violation of ordinances.
Petitioners argued that the ordinance is unconstitutional and void since it
violates the right to privacy and freedom of movement; it is an invalid exercise
of police power; and it is unreasonable and oppressive interference in their
business.
CA, in turn, reversed the decision of RTC and affirmed the constitutionality of
the ordinance. 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.
Hence, the petitioners appeared before the SC.
Issue:
Whether Ordinance No. 7774 is a valid exercise of police power of the State.
Held:
No. Ordinance No. 7774 cannot be considered as a valid exercise of police
power, and as such, it is unconstitutional.
The facts of this case will recall to mind not only the recent City of Manila v
Laguio Jr ruling, but the 1967 decision in Ermita-Malate Hotel and Motel
Operations Association, Inc., v. Hon. City Mayor of Manila. The common thread
that runs through those decisions and the case at bar goes beyond the
singularity of the localities covered under the respective ordinances. All three
ordinances were enacted with a view of regulating public morals including
particular illicit activity in transient lodging establishments. This could be
described as the middle case, wherein there is no wholesale ban on motels
and hotels but the 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 the lives of its citizens
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.
The ordinance in this case prohibits two specific and distinct business
practices, namely wash rate admissions and renting out a room more than
twice a day. The ban is evidently sought to be rooted in the police power as
conferred on local government units by the Local Government Code through
such implements as the general welfare clause.
Police power is based upon the concept of necessity of the State and its
corresponding right to protect itself and its people. Police power has been used
as justification for numerous and varied actions by the State.
The apparent goal of the ordinance is to minimize if not eliminate the use of the
covered establishments for illicit sex, prostitution, drug use and alike. These
goals, by themselves, are unimpeachable and certainly fall within the ambit of
the police power of the State. Yet the desirability of these ends do not sanctify
any and all means for their achievement. Those means must align with the
Constitution.
SC contended that if they 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 restraint imposed by the law that they were
capacitated to act upon is the injury to property sustained by the petitioners.
Yet, they also recognized 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. The rights at stake herein fell within the same fundamental rights to
liberty. 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,
Indeed, the right to privacy as a constitutional right must be recognized and the
invasion of it should be justified by a compelling state interest. Jurisprudence
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.
An ordinance which prevents the lawful uses of a wash rate depriving patrons
of a product and the petitioners of lucrative business ties in with another
constitutional requisite for the legitimacy of the ordinance as a police power
measure. 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. It
must also be evident that no other alternative for the accomplishment of the
purpose less intrusive of private rights can work. More importantly, a
reasonable relation must exist between the purposes of the 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.
Lacking a concurrence of these requisites, the police measure shall be struck
down as an arbitrary intrusion into private rights.
The behavior which the ordinance seeks to curtail is in fact already prohibited
and could in fact be diminished simply by applying existing laws. Less intrusive
measures such as curbing the proliferation of prostitutes and drug dealers
through active police work would be more effective in easing the situation. So
would the strict enforcement of existing laws and regulations penalizing
prostitution and drug use. These measures would have minimal intrusion on
the businesses of the petitioners and other legitimate merchants. Further, it is
apparent that the ordinance can easily be circumvented by merely paying the
whole day rate without any 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.
SC reiterated that individual rights may be adversely affected only to the extent
that may fairly be required by the legitimate demands of public interest or public
 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 their patrons. The ordinance needlessly restrains the
operation of the businesses of the petitioners as well as restricting the rights of
their patrons without sufficient justification. The ordinance rashly equates wash
rates and renting out a room more than twice a day with immorality without
accommodating innocuous intentions.
WHEREFORE, the Petition is GRANTED. The Decision of the Court of Appeals
is REVERSED, and the Decision of the Regional Trial Court of Manila, Branch
9, is REINSTATED. Ordinance No. 7774 is hereby declared
UNCONSTITUTIONAL. No pronouncement as to costs.
S O C I AL J U S T I C E S O C I E T Y V S AT I E N Z A ( 2 0 0 8 )
FACTS:
Petitioners Social Justice Society (SJS) et.al. filed a petition against Hon. Jose
L. Atienza, Jr., then mayor of the City of Manila, to enforce Ordinance No. 8027,
reclassifying the Oil Depot in Pandacan Terminal, from industrial to commercial
area and to cease and desist from operating their businesses from the date of
effectivity of the ordinance.
Oil companies, Chevron, Shell, Petron as well as DOE sought to intervene and
asked for the nullification of said ordinance. The oil companies assert that they
have a legal interest in this case because the implementation of Ordinance No.
8027 will directly affect their business and property rights. They allege that they
stand to lose billions of pesos if forced to relocate.
On the other hand, the Committee on Housing, Resettlement and Urban
Development of the City of Manila who recommended the approval of the
ordinance cited:
1. The depot facilities contained 313.5 million liters of highly flammable and
highly volatile products which include petroleum gas, liquefied petroleum
gas, aviation fuel, diesel, gasoline, kerosene and fuel oil among others;
2. The depot is open to attack through land, water or air;
3. It is situated in a densely populated place and near Malacañang Palace and
4. In case of an explosion or conflagration in the depot, the fire could spread to
the neighboring communities.
ISSUE:
Whether the enactment of the ordinance a legitimate exercise of Police Power.
HELD:
Yes. 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.
In the exercise of police power, property rights of individuals may be subjected
to restraints and burdens in order to fulfill the objectives of the government.
Otherwise stated, the government may enact legislation that may interfere with
personal liberty, property, lawful businesses and occupations to promote the
general welfare.However, the interference must be reasonable and not
arbitrary. And to forestall arbitrariness, the methods or means used to protect
public health, morals, safety or welfare must have a reasonable relation to the
end in view.
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 LGU’s exercise of police power
clashes with a few individuals’ right to property, the former should prevail.
SC reiterated the enforcement of Ordinance No. 8027.
Manila International Airport Authority v. Court of Appeals, G.R. No. 15560
(July 20, 3006) Case Digest
Facts:
MIAA received Final Notices of Real Estate Tax Delinquency from the City of
Parañaque for the taxable years 1992 to 2001. MIAA’s real estate tax
delinquency was estimated at P624 million. The City of Parañaque, through its
City Treasurer, issued notices of levy and warrants of levy on the Airport Lands
and Buildings. The Mayor of the City of Parañaque threatened to sell at public
auction the Airport Lands and Buildings should MIAA fail to pay the real estate
tax delinquency.
MIAA filed a petition sought to restrain the City of Parañaque from imposing
real estate tax on, levying against, and auctioning for public sale the Airport
Lands and Buildings.
The City of Parañaque contended that Section 193 of the Local Government
Code expressly withdrew the tax exemption privileges of “government-owned
and-controlled corporations” upon the effectivity of the Local Government
Code. Thus, MIAA cannot claim that the Airport Lands and Buildings are
exempt from real estate tax.
MIAA argued that Airport Lands and Buildings are owned by the Republic. The
government cannot tax itself. The reason for tax exemption of public property
is that its taxation would not inure to any public advantage, since in such a case
the tax debtor is also the tax creditor.
Issue:
Whether or not the City of Parañaque can impose real tax, levy against and
auction for public sale the Airport Lands and Buildings.
Held:
MIAA is Not a Government-Owned or Controlled Corporation. The Airport
Lands and Buildings of MIAA are property of public dominion and therefore
owned by the State or the Republic of the Philippines. No one can dispute that
properties of public dominion mentioned in Article 420 of the Civil Code, like
“roads, canals, rivers, torrents, ports and bridges constructed by the State,” are
owned by the State. The term “ports” includes seaports and airports. The MIAA
Airport Lands and Buildings constitute a “port” constructed by the State.
Under Article 420 of the Civil Code, the MIAA Airport Lands and Buildings are
properties of public dominion and thus owned by the State or the Republic of
the Philippines. The Airport Lands and Buildings are devoted to public use
because they are used by the public for international and domestic travel and
transportation. The fact that the MIAA collects terminal fees and other charges
from the public does not remove the character of the Airport Lands and
Buildings as properties for public use. The charging of fees to the public does
not determine the character of the property whether it is of public dominion or
not. Article 420 of the Civil Code defines property of public dominion as one
“intended for public use.”
The Court has also ruled that property of public dominion, being outside the
commerce of man, cannot be the subject of an auction sale. Properties of public
dominion, being for public use, are not subject to levy, encumbrance or
disposition through public or private sale. Any encumbrance, levy on execution
or auction sale of any property of public dominion is void for being contrary to
public policy. Essential public services will stop if properties of public dominion
are subject to encumbrances, foreclosures and auction sale. This will happen
if the City of Parañaque can foreclose and compel the auction sale of the 600-
hectare runway of the MIAA for non-payment of real estate tax.
Mactan Cebu International Airport Authority vs Marcos, et al.,
Facts:
Petitioner Mactan Cebu International Airport Authority (MCIAA) was created by
virtue of Republic Act No. 6958, mandated to “principally undertake the
economical, efficient and effective control, management and supervision of the
Mactan International Airport in the Province of Cebu and the Lahug Airport in
Cebu City, and such other airports as may be established in the Province of
Cebu. Since the time of its creation, petitioner MCIAA enjoyed the privilege of
exemption from payment of realty taxes in accordance with Section 14 of its
Charter:
"Sec. 14. Tax Exemptions. -- The Authority shall be exempt from realty taxes
imposed by the National Government or any of its political subdivisions,
agencies and instrumentalities."
On October 11, 1994, however, the Office of the Treasurer of the City of Cebu,
demanded payment for realty taxes on several parcels of land belonging to the
petitioner located at Barrio Apas and Barrio Kasambagan, Lahug, Cebu City,
in the total amount of P2,229,078.79. Petitioner objected to such demand for
payment as baseless and unjustified, claiming in its favor the aforecited Section
14 of RA 6958 which exempts it from payment of realty taxes. It was also
asserted that it is an instrumentality of the government performing
governmental functions, citing Section 133 of the Local Government Code of
1991 which puts limitations on the taxing powers of local government units:
"Section 133. Common Limitations on the Taxing 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:
a) x x x
x x x
o) Taxes, fees or charges of any kind on the National Government, its
agencies and instrumentalities, and local government units"
Respondent City refused to cancel and set aside petitioner’s realty tax account,
insisting that the MCIAA is a government-controlled corporation whose tax
exemption privilege has been withdrawn by virtue of Sections 193 and 234 of
the Local Government Code that took effect on January 1, 1992:
"Section 193. Withdrawal of Tax Exemption Privilege.— 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 RA No. 6938, non-stock and non-profit hospitals and
educational institutions, are hereby withdrawn upon the effectivity of this Code.
Section 234. Exemptions from Real Property Taxes. — x x x
(a) x x x value of such real estate owned and/or administered by the airports.” Hence,
x x x the petitioner is now the owner of the land in question and the exception in
(e) x x x Section 234(c) of the LGC is inapplicable.
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 government-owned or controlled corporations are hereby
withdrawn upon the effectivity of this Code."
Issues:
Whether the parcels of land in question belong to the Republic of the
Philippines whose beneficial use has been granted to the petitioner, and
Whether the petitioner is a “taxable person.”
Ruling:
Section 15 of the petitioner’s Charter provides:
Sec. 15. Transfer of Existing Facilities and Intangible Assets. — All existing
public airport facilities, runways, lands, buildings and other properties, movable
or immovable, belonging to or presently administered by the airports, and all
assets, powers, rights, interests and privileges relating on airport works or air
operations, including all equipment which are necessary for the operations of
air navigation, aerodrome control towers, crash, fire, and rescue facilities are
hereby transferred to the Authority: Provided, however, that the operations
control of all equipment necessary for the operation of radio aids to air
navigation, airways communication, the approach control office, and the area
control center shall be retained by the Air Transportation Office. No equipment,
however, shall be removed by the Air Transportation Office from Mactan
without the concurrence of the Authority. The Authority may assist in the
maintenance of the Air Transportation Office equipment.
It may be reasonable to assume that the term “lands” refer to “lands” in Cebu
City then administered by the Lahug Air Port and includes the parcels of land
the respondent City of Cebu seeks to levy on for real property taxes. This
section involves a “transfer” of the “lands,” among other things, to the petitioner
and not just the transfer of the beneficial use thereof, with the ownership being
retained by the Republic of the Philippines.
This “transfer” is actually an absolute conveyance of the ownership thereof
because the petitioner’s authorized capital stock consists of, inter alia, “the
Moreover, the petitioner cannot claim that it was never a “taxable person” under
its Charter. It was only exempted from the payment of real property taxes. The
grant of the privilege only in respect of this tax is conclusive proof of the
legislative intent to make it a taxable person subject to all taxes, except real
property tax.
Finally, even if the petitioner was originally not a taxable person for purposes
of real property tax, in light of the foregoing disquisitions, it had already
become, even if it be conceded to be an “agency” or “instrumentality” of the
Government, a taxable person for such purpose in view of the withdrawal in the
last paragraph of Section 234 of exemptions from the payment of real property
taxes, which, as earlier adverted to, applies to the petitioner.
City Government of Quezon City v. Bayan Telecommunications, Inc.
FACTS
Respondent Bayan Telecommunications, Inc. (Bayantel) is a legislative
franchise holder under Republic Act (R.A.) No. 3259 (1961) to establish and
operate radio stations for domestic telecommunications, radiophone,
broadcasting and telecasting. Section 14 (a) of R.A. No. 3259 states: “The
grantee shall be liable to pay the same taxes on its real estate, buildings and
personal property, exclusive of the franchise, xxx”. In 1992, R.A. No. 7160,
otherwise known as the “Local Government Code of 1991” (LGC) took effect.
Section 232 of the Code grants local government units within the Metro Manila (Bayantel’s) properties that are actually, directly and exclusively used in the
Area the power to levy tax on real properties. Barely few months after the pursuit of its franchise.
LGC took effect, Congress enacted R.A. No. 7633, amending Bayantel’s
original franchise. The Section 11 of the amendatory contained the following Drilon vs Lim
tax provision: “The grantee, its successors or assigns shall be liable to pay the
same taxes on their real estate, buildings and personal property, exclusive of Facts: The Secretary of Justice (on appeal to him of four oil companies and a
this franchise, xxx“. In 1993, the government of Quezon City enacted an taxpayer) declared
ordinance otherwise known as the Quezon City Revenue Code withdrawing tax Ordinance No. 7794 (Manila Revenue Code) null and void for non-compliance
exemption privileges. with the procedure in the
enactment of tax ordinances and for containing certain provisions contrary to
ISSUE law and public policy.
Whether or not Bayantel’s real properties in Quezon City are exempt from real The RTC revoked the Secretary’s resolution and sustained the ordinance. It
property taxes under its franchise. declared Sec 187 of
the LGC as unconstitutional because it vests on the Secretary the power of
RULING control over LGUs in violation
YES. A clash between the inherent taxing power of the legislature, which of the policy of local autonomy mandated in the Constitution. The Secretary
necessarily includes the power to exempt, and the local government’s argues that the annulled
delegated power to tax under the aegis of the 1987 Constitution must be ruled Section 187 is constitutional and that the procedural requirements for the
in favor of the former. The grant of taxing powers to LGUs under the enactment of tax ordinances as
Constitution and the LGC does not affect the power of Congress to grant specified in the Local Government Code had indeed not been observed.
exemptions to certain persons, pursuant to a declared national policy. The legal (Petition originally dismissed by
effect of the constitutional grant to local governments simply means that in the Court due to failure to submit certified true copy of the decision, but
interpreting statutory provisions on municipal taxing powers, doubts must be reinstated it anyway.)
resolved in favor of municipal corporations.
The legislative intent expressed in the phrase “exclusive of this Issue: WON the lower court has jurisdiction to consider the constitutionality of
franchise” cannot be construed other than distinguishing between two (2) sets Sec 187 of the LGC
of properties, be they real or personal, owned by the franchisee, namely, (a)
those actually, directly and exclusively used in its radio or telecommunications Held: Yes. BP 129 vests in the regional trial courts jurisdiction over all civil
business, and (b) those properties which are not so used. It is worthy to note cases in which the subject of
that the properties subject of the present controversy are only those which are the litigation is incapable of pecuniary estimation. Moreover, Article X, Section
admittedly falling under the first category. 5(2), of the Constitution
Since R. A. No. 7633 was enacted subsequent to the LGC, perfectly aware that vests in the Supreme Court appellate jurisdiction over final judgments and
the LGC has already withdrawn Bayantel’s former exemption from realty taxes, orders of lower courts in all
the Congress using, Section 11 thereof with exactly the same defining phrase cases in which the constitutionality or validity of any treaty, international or
“exclusive of this franchise” is the basis for Bayantel’s exemption from realty executive agreement, law,
taxes prior to the LGC. In plain language, the Court views this subsequent piece presidential decree, proclamation, order, instruction, ordinance, or regulation is
of legislation as an express and real intention on the part of Congress to once in question.
again remove from the LGC’s delegated taxing power, all of the franchisee’s In the exercise of this jurisdiction, lower courts are advised to act with the
utmost circumspection,
bearing in mind the consequences of a declaration of unconstitutionality upon
the stability of laws, no less
than on the doctrine of separation of powers. It is also emphasized that every
court, including this Court,
is charged with the duty of a purposeful hesitation before declaring a law
unconstitutional, on the theory
that the measure was first carefully studied by the executive and the legislative
departments and
determined by them to be in accordance with the fundamental law before it was
finally approved. To
doubt is to sustain. The presumption of constitutionality can be overcome only
by the clearest showing
that there was indeed an infraction of the Constitution.
Drilon vs Lim
Facts: The Secretary of Justice (on appeal to him of four oil companies and a
taxpayer) declared Ordinance No. 7794 (Manila Revenue Code) null and void
for non-compliance with the procedure in the enactment of tax ordinances and
for containing certain provisions contrary to law and public policy. The RTC
revoked the Secretary’s resolution and sustained the ordinance. It declared Sec
187 of the LGC as unconstitutional because it vests on the Secretary the power
of control over LGUs in violation of the policy of local autonomy mandated in
the Constitution. The Secretary argues that the annulled Section 187 is
constitutional and that the procedural requirements for the enactment of tax
ordinances as specified in the Local Government Code had indeed not been
observed. (Petition originally dismissed by the Court due to failure to submit
certified true copy of the decision, but reinstated it anyway.)
Issue: WON the lower court has jurisdiction to consider the constitutionality of
Sec 187 of the LGC
Held: Yes. BP 129 vests in the regional trial courts jurisdiction over all civil
cases in which the subject of the litigation is incapable of pecuniary estimation.
Moreover, Article X, Section 5(2), of the Constitution vests in the Supreme
Court appellate jurisdiction over final judgments and orders of lower courts in
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. In the exercise of this
jurisdiction, lower courts are advised to act with the utmost circumspection,
bearing in mind the consequences of a declaration of unconstitutionality upon
the stability of laws, no less than on the doctrine of separation of powers. It is
also emphasized that every court, including this Court, is charged with the duty
of a purposeful hesitation before declaring a law unconstitutional, on the theory
that the measure was first carefully studied by the executive and the legislative
departments and determined by them to be in accordance with the
fundamental law before it was finally approved. To doubt is to sustain. The
presumption of constitutionality can be overcome only by the clearest showing
that there was indeed an infraction of the Constitution.
Title: Batangas City v. Pilipinas Shell Petroleum Corp.
FACTS:
Respondent Pilipinas Shell Petroleum Corporation operates an oil refinery
and depot in Tabagao, Batangas City, which manufactures and produces
petroleum products that are distributed nationwide.
In 2002, respondent was only paying the amount of P98,964.71 for fees
and other charges which include the amount of P1,180.34 as Mayor's Permit.
However, on February 20, 2001, petitioner Batangas City, through its City
Legal Officer, sent a notice of assessment to respondent demanding the
payment of P92,373,720.50 and P312,656,253.04 as business taxes for its
manufacture and distribution of petroleum products. In addition, respondent
was also required and assessed to pay the amount of P4,299,851.00 as
Mayor's Permit Fee based on the gross sales of its Tabagao Refinery. The
assessment was allegedly pursuant of Section 134 of the LGC of 1991 and
Section 23 of its Batangas City Tax Code of 2002.
Respondent maintained that petitioners have no authority to impose the
said taxes and fees, and argued that the levy of local business taxes on the
business of manufacturing and distributing gasoline and other petroleum
products is contrary to law and against national policy.
Petitioners contended that the City of Batangas can legally impose taxes
on the business of manufacturing and distribution of petroleum products,
including the Mayor's Permit Fees upon respondent.
The CTA held that respondent is not subject to the business taxes on the
manufacture and distribution of petroleum products because of the express
limitation provided under Section 133 (h) of the LGC.
ISSUE/S
Whether or not a LGU is empowered under the LGC o impose business taxes
on persons or entities engaged in the business of manufacturing and
distribution of petroleum products. NO
RATIO
At the outset, it must be emphasized that although the power to tax is
inherent in the State, the same is not true for LGUs because although the
mandate to impose taxes granted to LGUs is categorical and long established
in the 1987 Philippine Constitution, the same is not all encompassing as it is
subject to limitations as explicitly stated in Section 5, Article X of the 1987
Constitution.
Per Section 5, Article X of the 1987 Constitution, "the power to tax is no
longer vested exclusively on Congress; local legislative bodies are now given
direct authority to levy taxes, fees and other charges." Nevertheless, such
authority is "subject to such guidelines and limitations as the Congress may
provide."
In conformity with Section 3, Article X of the 1987 Constitution, Congress
enacted Republic Act No. 7160, otherwise known as the Local Government
Code of 1991.Book II of the LGC governs local taxation and fiscal matters.
Relevant provisions of Book II of the LGC establish the parameters of the
taxing powers of LGUs.
Among the common limitations on the taxing powers of LGUs under
Section 133 of the LGC is paragraph (h) which states:
o SECTION 133. Common Limitations on the Taxing Powers of Local
Government Units.— Unless otherwise provided herein, the exercise of
taxing powers of provinces, cities, municipalities, and barangays shall not
extend to the levy of the following:
xxx xxx xxx
(h) Excise taxes on articles enumerated under the National Internal Revenue
Code, as amended, and taxes, fees or charges on petroleum products.;
From the foregoing, Section 133 (h) clearly specifies the two kinds of taxes
which cannot be imposed by LGUs: (1) excise taxes on articles enumerated
under the NIRC, as amended; and (2) taxes, fees or charges on petroleum
products.
Indisputably, the power of LGUs to impose business taxes derives from
Section 143 14 of the LGC. However, the same is subject to the explicit
statutory impediment provided for under Section 133 (h) of the same Code
which prohibits LGUs from imposing "taxes, fees or charges on petroleum
products." It can, therefore, be deduced that although
CITY GOVERNMENT OF QUEZON CITY and CITY COUNCIL OF QUEZON
CITY,petitioners, vs. HON. JUDGE VICENTE G. ERICTA as Judge of the
Court of First Instance of Rizal, Quezon City, Branch XVIII; HIMLAYANG
PILIPINO, INC., respondents.
Facts:
Section 9 of Ordinance No. 6118, S-64 provides that at least 6% of the total
area of the memorial park cemetery shall be set aside for the charity burial of
deceased persons who are paupers and have been residents of Quezon City
for at least 5 years prior to their death. As such, the Quezon City engineer
required the respondent, Himlayang Pilipino Inc, to stop any further selling
and/or transaction of memorial park lots in Quezon City where the owners
thereof have failed to donate the required 6% space intended for paupers
burial.
The then Court of First Instance and its judge, Hon. Ericta, declared Section 9
of Ordinance No. 6118, S-64 null and void.
Petitioners argued that the taking of the respondent’s property is a valid and
reasonable exercise of police power and that the land is taken for a public use
as it is intended for the burial ground of paupers. They further argued that the
Quezon City Council is authorized under its charter, in the exercise of local
police power, ” to make such further ordinances and resolutions not repugnant
to law as may be necessary to carry into effect and discharge the powers and
duties conferred by this Act and such as it shall deem necessary and proper to
provide for the health and safety, promote the prosperity, improve the morals,
peace, good order, comfort and convenience of the city and the inhabitants
thereof, and for the protection of property therein.”
On the otherhand, respondent Himlayang Pilipino, Inc. contended that the
taking or confiscation of property was obvious because the questioned
ordinance permanently restricts the use of the property such that it cannot be
used for any reasonable purpose and deprives the owner of all beneficial use
of his property.
Issue:
Is Section 9 of the ordinance in question a valid exercise of the police power?
Held:
No. The Sec. 9 of the ordinance is not a valid exercise of the police power.
Occupying the forefront in the bill of rights is the provision which states that ‘no
person shall be deprived of life, liberty or property without due process of law’
(Art. Ill, Section 1 subparagraph 1, Constitution). On the other hand, there are
three inherent powers of government by which the state interferes with the
property rights, namely-. (1) police power, (2) eminent domain, (3) taxation.
These are said to exist independently of the Constitution as necessary
attributes of sovereignty.
An examination of the Charter of Quezon City (Rep. Act No. 537), does not
reveal any provision that would justify the ordinance in question except the
provision granting police power to the City. Section 9 cannot be justified under
the power granted to Quezon City to tax, fix the license fee, and regulate such
other business, trades, and occupation as may be established or practised in
the City. The power to regulate does not include the power to prohibit or
confiscate. The ordinance in question not only confiscates but also prohibits
the operation of a memorial park cemetery.
Police power is defined by Freund as ‘the power of promoting the public welfare
by restraining and regulating the use of liberty and property’. It is usually
exerted in order to merely regulate the use and enjoyment of property of the
owner. If he is deprived of his property outright, it is not taken for public use but
rather to destroy in order to promote the general welfare. In police power, the
owner does not recover from the government for injury sustained in
consequence thereof.
Under the provisions of municipal charters which are known as the general
welfare clauses, a city, by virtue of its police power, may adopt ordinances to
the peace, safety, health, morals and the best and highest interests of the
municipality. It is a well-settled principle, growing out of the nature of well-
ordered and society, that every holder of property, however absolute and may
be his title, holds it under the implied liability that his use of it shall not be
injurious to the equal enjoyment of others having an equal right to the
enjoyment of their property, nor injurious to the rights of the community. A
property in the state is held subject to its general regulations, which are
necessary to the common good and general welfare. Rights of property, like all
other social and conventional rights, are subject to such reasonable limitations
in their enjoyment as shall prevent them from being injurious, and to such
reasonable restraints and regulations, established by law, as the legislature,
under the governing and controlling power vested in them by the constitution,
may think necessary and expedient. The state, under the police power, is
possessed with plenary power to deal with all matters relating to the general
health, morals, and safety of the people, so long as it does not contravene any
positive inhibition of the organic law and providing that such power is not
exercised in such a manner as to justify the interference of the courts to prevent
positive wrong and oppression.
However, in the case at hand, there is no reasonable relation between the
setting aside of at least six (6) percent of the total area of an private cemeteries
for charity burial grounds of deceased paupers and the promotion of health,
morals, good order, safety, or the general welfare of the people. The ordinance
is actually a taking without compensation of a certain area from a private
cemetery to benefit paupers who are charges of the municipal corporation.
Instead of building or maintaining a public cemetery for this purpose, the city
passes the burden to private cemeteries.
The expropriation without compensation of a portion of private cemeteries is
not covered by Section 12(t) of Republic Act 537, the Revised Charter of
Quezon City which empowers the city council to prohibit the burial of the dead
within the center of population of the city and to provide for their burial in a
proper place subject to the provisions of general law regulating burial grounds
and cemeteries. When the Local Government Code, Batas Pambansa Blg. 337
provides in Section 177 (q) that a Sangguniang panlungsod may “provide for
the burial of the dead in such place and in such manner as prescribed by law
or ordinance” it simply authorizes the city to provide its own city owned land or
to buy or expropriate private properties to construct public cemeteries. This has
been the law and practise in the past. It continues to the present. Expropriation,
however, requires payment of just compensation. The questioned ordinance is
different from laws and regulations requiring owners of subdivisions to set aside
certain areas for streets, parks, playgrounds, and other public facilities from the
land they sell to buyers of subdivision lots. The necessities of public safety,
health, and convenience are very clear from said requirements which are
intended to insure the development of communities with salubrious and
wholesome environments. The beneficiaries of the regulation, in turn, are made
to pay by the subdivision developer when individual lots are sold to home-
owners.
WHEREFORE, the petition for review is hereby DISMISSED. The decision of
the respondent court is affirmed.
CITY OF CEBU vs. SPOUSES APOLONIO and BLASA DEDAMO
FACTS:
On 17 September 1993, petitioner City of Cebu filed a complaint for eminent
domain against respondents spouses Apolonio and Blasa Dedamo. The
petitioner alleged therein that it needed the land 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 lower court fixed the amount of just compensation at
P20,826,339.50. Petitioner alleged that the lower court erred in fixing the
amount of just compensation at P20,826,339.50. 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, which affirmed the lower court’s decision in toto.
ISSUE:
Whether or not just compensation should be determined as of the
date of the filing of the complaint.
HELD:
No. In the case a t ba r, t he a pp licab le la w as to the po in t
of re cko nin g f o r 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 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."
REPUBLIC OF THE PHILIPPINES, represented by the General Manager of
the PHILIPPINE INFORMATION AGENCY (PIA), petitioner, vs. THE
HONORABLE COURT OF APPEALS and the HEIRS OF LUIS SANTOS as
herein represented by DR. SABINO SANTOS and PURIFICACION
SANTOS IMPERIAL, respondents.
FACTS:
 Petitioner instituted expropriation proceedings on 19 September 1969
before the Regional Trial Court ("RTC") of Bulacan, covering a total of
544,980 square meters of contiguous land situated along MacArthur
Highway, Malolos, Bulacan, to be utilized for the continued broadcast
operation and use of radio transmitter facilities for the "Voice of the
Philippines" project.
 Petitioner, through the Philippine Information Agency ("PIA"), took over
the premises after the previous lessee, the "Voice of America," had
ceased its operations thereat. Petitioner made a deposit of P517,558.80,
the sum provisionally fixed as being the reasonable value of the
property.
 On 26 February 1979, or more than nine years after the institution of the
expropriation proceedings – condemning the properties of the
defendants and that plaintiff is ordered to pay the defendants the just
compensation for said property which is the fair market value of the land
condemned, computed at the rate of six pesos (P6.00) per square meter,
with legal rate of interest from September 19, 1969, until fully paid
 The bone of contention in the instant controversy is the 76,589-square
meter property previously owned by Luis Santos which forms part of the
expropriated area.
 It would appear that the national government failed to pay to herein
respondents the compensation pursuant to the foregoing decision,
 On 09 May 1984, respondents filed a manifestation with a motion
seeking payment for the expropriated property.
 On 07 June 1984, the Bulacan RTC, after ascertaining that the heirs
remained unpaid in the sum of P1,058,655.05, issued a writ of execution
served on the plaintiff, through the Office of the Solicitor General, for the
implementation thereof.
 When the order was not complied with, respondents again filed a motion
urging the trial court to direct the provincial treasurer of Bulacan to
release to them the amount of P72,683.55, a portion of the sum
deposited by petitioner at the inception of the expropriation proceedings
 in 1969, corresponding to their share of the deposit. The trial court, in its
order of 10 July 1984, granted the motion.
 In the meantime, President Joseph Ejercito Estrada issued
Proclamation No. 22, 2 transferring 20 hectares of the expropriated
property to the Bulacan State University for the expansion of its facilities
and another 5 hectares to be used exclusively for the propagation of the
Philippine carabao. The remaining portion was retained by the PIA.
 This fact notwithstanding, and despite the 1984 court order, the Santos
heirs remained unpaid, and no action was taken on their case until 16
September 1999 when petitioner filed its manifestation and motion to
permit the deposit in court of the amount of P4,664,000.00 by way of just
compensation for the expropriated property of the late Luis Santos
subject to such final computation as might be approved by the court.
This time, the Santos heirs, opposing the manifestation and motion,
submitted a counter-motion to adjust the compensation from P6.00 per
square meter previously fixed in the 1979 decision to its current zonal
valuation pegged at P5,000.00 per square meter or, in the alternative,
to cause the return to them of the expropriated property. On 01 March
2000, the Bulacan RTC ruled in favor of respondents and issued the
assailed order, vacating its decision of 26 February 1979 and declaring
it to be unenforceable on the ground of prescription —
 Petitioner brought the matter up to the Court of Appeals but the petition
was outrightly denied. It would appear that the denial was based on
Section 4, Rule 65, of the 1997 Rules of Civil Procedure which provided
that the filing of a motion for reconsideration in due time after filing of the
judgment, order or resolution interrupted the running of the sixty-day
period within which to file a petition for certiorari; and that if a motion for
reconsideration was denied, the aggrieved party could file the petition
only within the remaining period, but which should not be less than five
days in any event, reckoned from the notice of such denial.
 Thus this instant petition.
ISSUE/S: WON defendants can expropriate unpaid lands from the
government?
RULING:
 The expropriated property has been shown to be for the continued utilization
by the PIA, a significant portion thereof being ceded for the expansion of
the facilities of the Bulacan State University and for the propagation of the
Philippine carabao, themselves in line with the requirements of public
purpose.
 Respondents question the public nature of the utilization by petitioner of the
condemned property, pointing out that its present use differs from the
purpose originally contemplated in the 1969 expropriation proceedings. The
argument is of no moment. The property has assumed a public character
upon its expropriation. Surely, petitioner, as the condemnor and as the
owner of the property, is well within its rights to alter and decide the use of
that property, the only limitation being that it be for public use, which,
decidedly, it is.
 In insisting on the return of the expropriated property, respondents would
exhort on the pronouncement in Provincial Government of Sorsogon vs.
Vda. de Villaroya 14where the unpaid landowners were allowed the
alternative remedy of recovery of the property there in question. It might be
borne in mind that the case involved the municipal government of Sorsogon,
to which the power of eminent domain is not inherent, but merely delegated
and of limited application.
 The grant of the power of eminent domain to local governments under
Republic Act No. 7160 15 cannot be understood as being the pervasive and
all-encompassing power vested in the legislative branch of government. For
local governments to be able to wield the power, it must, by enabling law,
be delegated to it by the national legislature, but even then, this delegated
power of eminent domain is not, strictly speaking, a power of eminent, but
only of inferior, domain or only as broad or confined as the real authority
would want it to be.
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. Fundamental to the independent existence of a State, it
requires no recognition by the Constitution, whose provisions are taken as
being merely confirmatory of its presence and as being regulatory, at most, in
the due exercise of the power.
 The ubiquitous character of eminent domain is manifest in the nature of
the expropriation proceedings.
 Expropriation proceedings are not adversarial in the conventional
sense, for the condemning authority is not required to assert any
conflicting interest in the property. Thus, by filing the action, the
condemnor in effect merely serves notice that it is taking title and
possession of the property, and the defendant asserts title or interest in
 the property, not to prove a right to possession, but to prove a right to
compensation for the taking.
Limitation of Right to eminent Domain:
1. first, the taking must be for public use; and
a. In determining "public use," two approaches are utilized —
i. the first is public employment the actual use by the public,
and
ii. the second is public advantage or benefit.
2. second, that just compensation must be given to the private owner of
the property.
 These twin proscriptions have their origin in the recognition of the
necessity for achieving balance between the State interests, on the one
hand, and private rights, upon the other hand, by effectively restraining
the former and affording protection to the latter
The expropriated property has been shown to be for the continued utilization
by the PIA, a significant portion thereof being ceded for the expansion of the
facilities of the Bulacan State University and for the propagation of the
Philippine carabao, themselves in line with the requirements of public purpose.
The property has assumed a public character upon its expropriation. Surely,
petitioner, as the condemnor and as the owner of the property, is well within its
rights to alter and decide the use of that property, the only limitation being that
it be for public use, which, decidedly, it is.
 The judgment rendered by the Bulacan RTC in 1979 on the
expropriation proceedings provides not only for the payment of just
compensation to herein respondents but likewise adjudges the property
condemned in favor of petitioner over which parties, as well as their
privies, are bound. Petitioner has occupied, utilized and, for all intents
and purposes, exercised dominion over the property pursuant to the
judgment.
 The Bulacan trial court, in its 1979 decision, was correct in imposing
interests on the zonal value of the property to be computed from the time
petitioner instituted condemnation proceedings and "took" the property
in September 1969. This allowance of interest on the amount found to
be the value of the property as of the time of the taking computed, being
an effective forbearance, at 12% per annum 28 should help eliminate
the issue of the constant fluctuation and inflation of the value of the
currency over time. 29 Article 1250 of the Civil Code, providing that, in
case of extraordinary inflation or deflation, the value of the currency at
the time of the establishment of the obligation shall be the basis for the
payment when no agreement to the contrary is stipulated, has strict
application only to contractual obligations. 30In other words, a
contractual agreement is needed for the effects of extraordinary inflation
to be taken into account to alter the value of the currency. 31

 All given, the trial court of Bulacan in issuing its order, dated 01 March
2000, vacating its decision of 26 February 1979 has acted beyond its
lawful cognizance, the only authority left to it being to order its execution.
Verily, private respondents, although not entitled to the return of the
expropriated property, deserve to be paid promptly on the yet unpaid
award of just compensation already fixed by final judgment of the
Bulacan RTC on 26 February 1979 at P6.00 per square meter, with legal
interest thereon at 12% per annum computed from the date of "taking"
of the property, i.e., 19 September 1969, until the due amount shall have
been fully paid.
 WHEREFORE, the petition is GRANTED. The resolution, dated 31 July
2000, of the Court of Appeals dismissing the petition for certiorari, as
well as its resolution of 04 January 2001 denying the motion for
reconsideration, and the decision of the Regional Trial Court of Bulacan,
dated 01 March 2000, are SET ASIDE. Let the case be forthwith
remanded to the Regional Trial Court of Bulacan for the proper
execution of its decision promulgated on 26 February 1979 which is
hereby REINSTATED. No costs.
DAR vs Sarangani
Facts: The Sangguniang Bayan of Alabel, Sarangani passed Resolution No.
97-08 adopting a 10 year comprehensive development plan of the municipality
and its land use. On January 30, 1998, pursuant to Municipal Zoning
Ordinance No. 08, Series of 1997, and to accelerate the development
and urbanization of Alabel, the Sangguniang Bayan of Alabel passed
Resolution No. 98-03 reclassifying lots that were located within the built-up
areas, based on the 1995-2005 Land Use Plan of the municipality, from
agricultural to non-agricultural uses. Later, the Sangguniang Panlalawigan of
Sarangani approved Resolution No. 98-018 or the “Resolution Adopting the
Ten-Year Municipal Comprehensive Development Plan (MCDP 1995-
2205)and the Land Use Development Plan and Zoning Ordinance of the
Municipality of Alabel, Sarangani Per Resolution No. 97-08 and Municipal
Ordinance No. 97-08, S. of 1997 of the Sangguniang Bayan of Alabel.” A
portion of the area involving 376.5424 hectares, however, was
covered by the CARP commercial farms deferment scheme. The Zoning
Certification issued by the office of the Municipal Planning and
Development Council (MPDC) showed that respondents’ properties located
at Barangay Maribulan, Alabel were among those reclassified from
agricultural and pasture land to residential, commercial institutional, light
industrial and open space in the 1995-2005 land use plan of Alabel. The
respondent then field an application for land use conversion of certain parcels
of land. Meanwhile, members of the Sarangani Agrarian Reform
Beneficiaries Association, Inc. (SARBAI)sent a letter-petition to the DAR
Secretary oppposing the application for land use conversion filed by SACI.
SARBAI alleged that its members were merely forced to sign the waiver of
rights, considering that the commercial farm deferment period ended on June
15, 1998. Later, the PLUTC agreed to recommend the disapproval of a
portion of a property which was still viable for agriculture. The
conversion was deferred subject to the submission of certain requirements.
Later, the DAR Secretary denied SACI’s application for land use conversion.
On November 9, 2000, DAR Secretary Horacio R. Morales, Jr. denied SACI’s
application for land use conversion. SACI appealed to the Office of the
President. The Office of the President dismissed the appeal and affirmed in toto
the challenged DAR Orders. Respondents’ motion for reconsideration was
denied, so they filed with the Court of Appeals a petition for review raising
substantially the same issues. The CA granted the petition and ordred DAR to
issue a conversion order. As to the deferred portion, DAR was directed to
expedite the processing and evaluation of petitioner’s application.
Issue: WON a notice of coverage is an indispensable requirement for the
acquisition of land
Held: No, Under the circumstances, a notice of coverage is not an
indispensable requirement before DAR can acquire the subject lots or
commercial farms, which are covered by a deferment period under the
Comprehensive Agrarian Reform Law (CARL) or R.A. No 6657 upon its
effectivity on June 15, 1998
Issue: WON the DAR should use the comprehensive land use plans
and ordinance of the local sanggunian as primary reference
Held: Yes, Section 20 of Republic Act No. 7160, otherwise known as the Local
Government Code of1991, empowers the local government units to reclassify
agricultural lands. Memorandum Circular No.54 “Prescribing the Guidelines
Governing Section 20 of R.A. No. 7160 Otherwise Known as the Local
Government Code of 1991 Authorizing Cities and Municipalities to Reclassify
Agricultural Lands Into Non-Agricultural Uses” issued by President Ramos on
June 8, 1993 specified the scope and limitations on the power of the cities and
municipalities to reclassify agricultural lands into other uses. It provided that all
ordinances authorizing reclassification of agricultural lands shall be subject to
the review and approval of the province in the case of component cities or
municipalities, or by the HLURB for highly urbanized or independent
component cities in accordance with Executive Order No. 72, Series of
1993.Hence, with regard to agricultural lands that have been reclassified for
non-agricultural uses by the local government unit concerned, the CA is
correct in declaring that DAR should refer to the comprehensive land use
plans and the ordinances of the Sanggunian in assessing land use conversion
applications, thus: Construing Sec. 20 of the Local Government Code and the
subsequent administrative issuances implementing the same, we are of the
opinion that while the DAR retains the responsibility for approving or
disapproving applications for land use conversion filed by individual
landowners on their landholdings, the exercise of such authority
should be confined to compliance with the requirements and limitations
under existing laws and regulations, such as the allowable percentage of
agricultural [area] to be reclassified, ensuring sufficient food production, areas
non-negotiable for conversion and those falling under environmentally critical
areas or highly restricted for conversion under the NIPAS law. Definitely, the
DAR’s power in such cases may not be exercised in such a manner as to defeat
the very purpose of the LGU concerned in reclassifying certain areas to
achieve social and economic benefits in pursuit of its mandate towards
the general welfare. Precisely, therefore, the DAR is required to use
the comprehensive land use plans and accompanying ordinances of
the local Sanggunian as primary references in evaluating applications for land
use conversion filed by individual landowners. In this case, petitioners have
already complied with the standard requirements laid down under the
applicable rules and regulations of the DAR.... The conversion of agricultural
lands into non-agricultural uses shall be strictly regulated andmay be allowed
only when the conditions prescribed under R.A. No. 6657 are present. In this
regard, the Court agrees with the ratiocination of the CA that DAR’s scope of
authority in assessing land use conversion applications is limited to examining
whether the requirements prescribed by law and existing rules and regulations
have been complied with. This holds true in the present case where, because
of the creation of the Province of Sarangani and in view of its thrust to urbanize,
particularly its provincial capital which is the Municipality of Alabel, the local
government has reclassified certain portions of its island area from agricultural
to non-agricultural. Thus, to reiterate, in accordance with E.O. No. 72, Series
of 1993, and subject to the limitations prescribed by law, DAR should utilize the
comprehensive land use plans in evaluating the land use conversion
application of respondents whose lands have already been reclassified by the
local government for non-agricultural uses. This is not to say, however,
that every property of respondents which is included in the
comprehensive land use plan of the Municipality of Alabel shall be
automatically granted non-coverage. As mentioned earlier, said application is
subject to the limitations and conditions prescribed by law. One such limitation
that is present here is that a portion of respondents’ property of 376.5424
hectares, apportion totaling 154.622 [or 154.1622] hectares which are
planted to bananas and coconuts, are covered by CARL’s ten-year
deferment scheme, which has expired on June 15, 1998. By law, these lands
are subject to redistribution to CARP beneficiaries upon the lapse of the ten-
year period, counted from the date of the effectivity of the CARL or R.A. No.
6657 on June 15, 1988, which was way before the creation of the Province of
Sarangani and the eventual reclassification of the agricultural lands into non-
agricultural in the Municipality of Alabel where respondents’ properties are
located. In short, the creation of the new Province of Sarangani,
and the reclassification that was effected by the Municipality of Alabel did
not operate to supersede the applicable provisions of R.A. No.6657. Moreover,
Section 20 of the LGC of 1991 on the reclassification of lands explicitly states
that“[n]othing in this section shall be construed as repealing, amending or
modifying in any manner the provisions of R.A. No. 6657.” Thus, where the law
speaks in clear and categorical language, there is no room for interpretation.
There is only room for application
Sangalang vs IAC GR 71169 22 December 1988
Facts: Bel-Air Village is located north of Buendia Avenue extension across a
stretch of commercial block from Reposo Street in the west up to Zodiac Street
in the east. When Bel-Air Village was planned, this block between Reposo and
Zodiac Streets adjoining Buendia Avenue in front of the village was designated
as a commercial block. Bel-Air Village was owned and developed into a
residential subdivision in the 1950s by Makati Development Corporation
(MDC), which in 1968 was merged with Ayala Corporation.
 Spouses Sangalang reside at 110 Jupiter St. between Makati Ave. and
Reposo St.; Spouses Gaston reside at 64 Jupiter St. between Makati Ave.
and Zodiac St.; Spouses Briones reside at 66 Jupiter St.; while Bel-Air
Village Association, Inc. (BAVA) is the homeowners’ association in Bel-Air
Village which takes care of the sanitation, security, traffic regulations and
general welfare of the village.
 The lots which were acquired by the Sangalangs, the Gastons, the
Brioneses in 1960, 1957 and 1958, respectively, all sold by MDC subject to
certain conditions and easements contained in Deed Restrictions which
formed a part of each deed of sale (i.e. being automatic members of Bel-Air
Association who must abide by the rules and regulations laid down by the
Association [as per sanitation, security and general welfare of the
community]; that lots cannot be subdivided and only used for residential
purposes; that single family house be constructed in single lot; no
commercial or advertising signs placed or erected on the lot; no farm
animals allowed, pets allowed; easement of 2 meters within lot; lot not used
for immoral or illegal trade or activity; grass always trimmed; Restrictions in
force for 50 years starting 15 January 1957).
 MDC constructed a fence on the commercial block along Jupiter Street in
1966, although it was not part of the original plan. The fence was partially
destroyed in 1970 due to a typhoon. The fence was subsequently rebuilt by
the Ayala. Jupiter Street was widened in 1972, and the fence had to be
destroyed. Upon request of BAVA, the wall was rebuilt inside the boundary
of the commercial block. Ayala finally decided to subdivide and sell the lots
in the commercial block between Buendia and Jupiter. BAVA requested
confirmation of use of the commercial lots.
 On 30 June 1972, Ayala likewise informed BAVA that in a few months it
shall subdivided and sell the commercial lots bordering the north side of
Buendia Avenue Extension from Reposo St. up to Zodiac St. Deed
restrictions (building having set back of 19 meters, and matters RE
entrances and exits) are imposed in such commercial lots to harmonize and
blend with the development and welfare of Bel-Air Village. Ayala further
applied for special membership in BAVA of the commercial lot owners, the
application submitted to BAVA’s board of governors for decision.
 On 25 September 1972, height limitations for buildings were increased from
12.5 meters to 15 meters and Jupiter street is widened by 3.5 meters. The
 widening of the street reduced the association dues to be remitted to BAVA,
inasmuch that it now applies to 76,726 sq.m. rather than 81,590 sq.m. Due
rates have increased from P0.5/sq.m in 1972 to P3/sq.m in 1980.
 On 4 April 1975, Makati enacted Ordinance 81, providing for the zonification
of Makati, which classified Bel-Air Village as a Class A Residential Zone,
with its boundary in the south extending to the center line of Jupiter Street
(Chapter 3, Article 1, Section 3.03, paragraph F). The Buendia Avenue
extension area was classified as Administrative Office Zone with its
boundary in the North-North East Extending also up to the center line of
Jupiter Street (Chapter 3, Article 1, Section 3.05, paragraph C). The
Residential Zone and the Administrative Office Zone have a common
boundary along the center line of Jupiter Street. The zoning was later
followed under the Comprehensive Zoning Ordinance for the National
Capital Region adopted by the Metro Manila Commission as Ordinance 81-
01 on 14 March 1981, with modification that Bel-Air Village is simply
bounded in the South-Southeast by Jupiter Street, and the block-deep strip
along the northwest side of Buendia Avenue Extension from Reposo to
EDSA as High Intensity Commercial Zone. Under the zoning classification,
Jupiter Street is a common boundary of Bel-Air Village and the commercial
zone.
 On 17 January 1977, the Office of the Mayor of Makati directed BAVA, in
the interest of public welfare and purpose of easing traffic congestion, the
opening of the Amapola (Estrella-Mercedes; Palma gate-Villena), Mercedes
(EDSA-Imelda/Amapola junction), Zodiac (Mercedes-Buendia), Jupiter
(Zodiac-Reposo, connecting Metropolitan avenue to Pasong Tamo and V.
Cruz extension), Neptune (Makati ave.-Reposo), Orbit (F.Zobel/ Candelaria
intersection –Jupiter Paseo de Roxas; Mercedes-Buendia) streets of Bel-
Air Village for public use. On 10 February, BAVA replied, expressing
concern of the residents about the opening of the streets to general public
and requesting the indefinite postponement of the plan to open Jupiter St.
to public vehicles. BAVA, however, voluntarily opened the other streets.
 On 12 August 1977, the municipal officials of Makati allegedly opened,
destroyed and removed the gates constructed at the corner of Reposo St.
and Jupiter St. as well as gates/fences constructed at Jupiter Street and
Makati Avenue forcibly; thereby opening Jupiter street to public traffic.
Increased traffic was observed along Jupiter Street after its opening to
public use. Purchasers of the commercial lots started constructing their
respective buildings and demolished the fence or wall within the boundary
of their lots. Many owners constructed their own fences and walls and
employed their own security guards.
 On 27 January 1978, Ayala donated the entire Jupiter Street from
Metropolitan Avenue to Zodiac Street to BAVA. With the opening of the
entire Jupiter street to public traffic, the residential lots located in the
northern side of Jupiter Street ceased to be used for purely residential
purposes, and became commercial in character.
 On 29 October 1979, spouses Sangalang filed an action for damages
against Ayala predicated on both breach of contract and on tort or quasi-
delict. A supplemental complaint was later filed by the Sangalangs to
augment the reliefs prayed for in the original complaint because of alleged
supervening events which occurred during the trial of the case. Claiming to
be similarly situated, spouses Gaston, Briones, and BAVA intervened in the
case. The CFI Pasig rendered a decision in favor of the Sangalangs
awarding them P500,000 as actual and consequential damages, P2M as
moral damages, P500,000 as exemplary damages, P100,000 as attorney’s
fees, and the cost of suit. The intervenors Gaston and Briones were
awarded P400,000 as consequential damages, P500,000 as moral
damages, P500,000 as exemplary damages, P50,000 as attorney’s fees,
and the cost of suit; each. Intervenor BAVA was awarded the same except
for moral damages. The damages awarded bear legal interest from the filing
of the complaint. Ayala was also ordered to restore/reconstruct the
perimeter wall at the original position in 1966 at its own expense within 6
months from finality of judgment. On appeal, the Court of Appeals reversed
and set aside the decision for not being supported by facts and law on the
matter; and entered another, dismissing the case for lack of cause of action;
without pronouncement as to costs. Sangalang appealed.
 [GR 74376] The Bel-Air Village Association (BAVA) filed and action to
enforce the restrictions stipulated in the deeds of sale executed by the Ayala
Corporation. BAVA originally brought the complaint in the RTC Makati,
principally for specific performance, BAVA alleging that Rosario de Jesus
Tenorio allowed Cecilia Gonzalvez to occupy and convert the house at 60
Jupiter Street into a restaurant, without its knowledge and consent, and in
violation of the deed restrictions which provide that the lot and building
thereon must be used only for residential purposes upon which the prayed-
for main relief was for Tenorio and Gonzalves to permanently refrain from
using the premises as commercial and to comply with the terms of the Deed
Restrictions. The trial court dismissed the complaint on a procedural
ground, i.e., pendency of an identical action, Civil Case 32346 (BAVA v.
 Tenorio). The Court of Appeals affirmed, and held, in addition, that Jupiter
Street “is classified as High density commercial (C-3) zone as per
Comprehensive Zoning Ordinance 81-01 for NCR following its own ruling in
AC-GR 66649 (BAVA v. Hy-Land Realty & Development Corp.). BAVA
appealed.
[GR 76394] Spouses Eduardo Romualdez and Buena Tioseco are the owners
of a house and lot located at 108 Jupiter St (TCT 332394, Registry of Deeds
Rizal).At the time they acquired the subject house and lot, several restrictions
were already annotated on the reverse side of their title. The restriction(s)
remain in force for 50 years from 15 January 1957, unless sooner cancelled in
its entirety by 2/3 vote of the members in good standing of the Bel-Air Village
Association (BAVA). However, the Association may from time to time, add new
ones, amend or abolish particular restrictions or parts thereof by majority rule.
During the early part of 1979, BAVA noted that certain renovations and
constructions were being made by the spouses on the premises. The latter
failed to inform BAVA of the activity, even upon request, that prompted BAVA
to send its chief security officer to visit the premises on 23 March 1979 and
found out that the spouses were putting up a bake and coffee shop. The
spouses were reminded that they were violating the deed restriction, but the
latter proceeded with the construction of the bake shop. On 30 April 1979,
BAVA wrote the spouses to desist from using the premises for commercial
purposes, with threat of suit. Despite the warning, the spouses proceeded with
the construction of their bake shop. The trial court adjudged in favor of BAVA.
On appeal, the Court of Appeals reversed the decision on the strength of its
holding in AC-GR 66649. BAVA elevated the matter to the Supreme Court by
a petition for review on certiorari. The Court initially denied the petition for lack
of merit, for which BAVA sought a reconsideration. Pending resolution, the case
was referred to the Second Division and thereafter, to the Court En Banc en
consulta. Per Resolution, dated 29 April 1988, the case was consolidated with
GR 74376 and 82281.
[GR 78182] Dolores Filley leased her building and lot situated at 205 Reposo
Street to the advertising firm J. Romero and Associates, in alleged violation of
deed restrictions which stipulated that Filley’s lot could only be used for
residential purposes. The Bel-Air Village Association (BAVA) sought judgment
from the lower court ordering the Filley and J.Romero to permanently refrain
from using the premises in question as commercial and to comply with the
terms of the deed restrictions. The trial court granted the relief sought for by
BAVA with the a additional imposition of exemplary damages of P50,000.00
and attorney’s fees of P10,000.00. The trial court gave emphasis to the
restrictive clauses contained in Filley’s deed of sale from BAVA, which made
the conversion of the building into a commercial one a violation. Appeal was
made claiming that the restrictions in the deed of sale are outmoded. BAVA on
the other hand relied on a rigid interpretation of the contractual stipulations
agreed upon with Filley, in effect arguing that the restrictions are valid ad
infinitum. The Court of Appeals overturned the lower court, observing that J.
Romero & Associates had been given authority to open a commercial office by
the Human Settlements Regulatory Commission.
[GR 82281] Violeta Moncal, owner of a parcel of land with a residential house
constructed thereon situated at 104 Jupiter Street, leased her property to Majal
Development Corporation, without the consent of the Bel-Air Village
Association (BAVA). She purchased the lot from Makati Development
Corporation. The lot in question is restricted to be used for residential purposes
only as part of the deed restrictions annotated on its title. It is on the same side
of the street where there are restaurants, clinics, placement or employment
agencies and other commercial or business establishments. These
establishments, however, were sued by BAVA in the proper court. The trial
court dismissed the BAVA’s complaint, a dismissal affirmed on appeal. The
appellate court declared that the opening of Jupiter Street to human and
vehicular traffic, and the commercialization of the Municipality of Makati in
general, were circumstances that had made compliance by Moncal with the
aforesaid “deed restrictions” “extremely difficult and unreasonable, a
development that had excused compliance altogether under Article 1267 of the
Civil Code. BAVA appealed.
Short Facts:
GR 74376, 76394, 78182, and 82281 are efforts to enforce the “deed
restrictions” against specific residents of Jupiter Street and, with respect to GR
78182, Reposo Street. The residents have allegedly converted their residences
into commercial establishments (a restaurant in GR 74376, a bakery and coffee
shop in GR 76394, an advertising firm in GR 78182; and a construction
company, apparently, in GR 82281) in violation of the said restrictions. Their
mother case, GR 71169 is, on the other hand, a petition to hold the vendor
itself, Ayala Corporation (formerly Makati Development Corporation), liable for
tearing down the perimeter wall along Jupiter Street that had theretofore closed
its commercial section from the residences of Bel-Air Village and ushering in,
as a consequence, the full “commercialization” of Jupiter Street, in violation of
the very restrictions it had authored. The Court of Appeals dismissed all 5
appeals on the basis primarily of its ruling in AC-GR 66649, “Bel-Air Village,
Inc. v. Hy-Land Realty Development Corporation, et al.,” in which the appellate
court explicitly rejected claims under the same “deed restrictions” as a result of
Ordinance 81 enacted by the Government of the Municipality of Makati, as well
as Comprehensive Zoning Ordinance 8101 promulgated by the Metropolitan
Manila Commission, which two ordinances allegedly allowed the use of Jupiter
Street both for residential and commercial purposes. It was likewise held that
these twin measures were valid as a legitimate exercise of police power.
Issue: WON Makati Resolution No. 81 and MMC Ordinance 81-01 are
unconstitutional as violative of the non-impairment clause of the Constitution.
Decision: No. Both are constitutional. All contracts are subject to the
overriding demands, needs, and interests of the greater number as the State
may determine in the legitimate exercise of police power. The Court guarantees
sanctity of contract and is said to be the “law between the contracting parties,”
but while it is so, it cannot contravene “law, morals, good customs, public order,
or public policy.” Above all, it cannot be raised as a deterrent to police power,
designed precisely to promote health, safety, peace, and enhance the common
good, at the expense of contractual rights, whenever necessary. 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. Invariably
described as “the most essential, insistent, and illimitable of powers” and “in a
sense, the greatest and most powerful attribute of government,” 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. 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. Public welfare, when
clashing with the individual right to property, should be made to prevail through
the state’s exercise of its police power. Herein, the MMC Ordinance represents
a legitimate exercise of police power, as the ordinance is neither capricious or
arbitrary or unreasonable; but that it is based on compelling interests of general
welfare. The restrictive easements are similar to any other contract, and should
not deter the valid exercise of police power. The MMC has reclassified Jupiter
Street into a “high density commercial zone, pursuant to Ordinance 81-01.
Sangalang, BAVA, et. al., thus have no cause of action on the strength alone
of said “deed restrictions.”
Metropolitan Manila Development Authority, petitioner
vs Bel-Air Village Association, Inc., respondent
Facts:
MMDA is a government agency tasked with the delivery of basic services in
Metro Manila. Bel-Air is a non-stock, non-profit corporation whose members
are homeowners of Bel-Air Villagee in Makati City. Bel-Air is the registered
owner of the Neptune Street, a road inside Bel-Air Village.
December 30, 1995 Bel-Air received a notice from MMDA requesting Bel-Air to
open Neptune St. to public vehicular traffic. On the same day, MMDA apprised
that the perimeter wall separating the subdivision from the adjacent Kalayaan
Avenue would be demolished.
January 2, 1996, MMDA instituted a case for injunction against Bel-Air; and
prayed for a TRO and preliminary injunction enjoining Neptune St. and
prohibiting the demolition of the perimeter wall. Court issued a TRO the next
day.
After due hearing, RTC denied the issuance of a preliminary injunction. MMDA
question the denial and appealed to the CA. CA conducted an ocular inspection
of Neptune St. then issued a writ of preliminary injunction enjoining the MMDA
proposed action.
On January 27, 1997, appellate court rendered a decision finding MMDA no
authority to order the opening of Neptune St. It held that the authority is in the
City Council of Makati by ordinance.
The motion for reconsideration is denied hence this recourse.
Issues: (1) MMDA has the authority to mandate the opening of Neptune St. to
public traffic pursuant to its regulatory and police powers? (2) Is passage of an
ordinance a condition precedent before the MMDA may order the opening of
subdividion roads to public traffic? (3) Is Bel-Air estopped from denying the
authority of MMDA? (4)Was Bel-Air denied of due process despite the several
meetings held between MMDA and Bel-Air? (5) Has Bel-Air come to court with
unclean hands?
MMDA: it has the authority to open Neptune St. because it is an agent of the
Government endowed with police power in the delivery of basic services in
Metro Manila. From the premise of police powers, it follow then that it need not
for an ordinance to be enacted first.
**Police power is an inherent attribute of sovereignty. Police power is lodged
primarily in the National Legislature, which the latter can delegate to the
President and administrative boards, LGU or other lawmaking bodies.
**LGU is a political subdivision for local affairs. Which has a legislative body
empowered to enact ordinances, approved resolutions and appropriate funds
for the general welfare of the province/city/municipality.
**Metro Manila is declared as a special development and administrative region
in 1995. And the administration of metro-wide basic services is under the
MMDA.Which includes, transport and traffice management. It should be noted
that MMDA are limited to the acts: formulation, coordination, regulation,
implementation, preparation, management, monitoring, setting of policies and
installation of a system and administration. MMDA was not granted with
legislative power.
Ruling:
(1) The basis for the proposed opening of Neptune Street is contained in the
notice of December 22, 1995 sent by petitioner to respondent BAVA, through
its president. The notice does not cite any ordinance or law, either by the
Sangguniang Panlungsod of Makati City or by the MMDA, as the legal basis
for the proposed opening of Neptune St.
(2) The MMDA is not the same entity as the MMC in Sangalang. Although the
MMC is the forerunner of the present MMDA, an examination of Presidential
Decree (P. D.) No. 824, the charter of the MMC, shows that the latter
possessed greater powers which were not bestowed on the present MMDA.
(3) Under the 1987 Constitution, the local government units became primarily
responsible for the governance of their respective political subdivisions. The
MMA's jurisdiction was limited to addressing common problems involving basic
services that transcended local boundaries. It did not have legislative power.
Petition Denied.
LUCENA GRAND CENTRAL TERMINAL, INC. v. JAC LINER, INC. 452
SCRA 174 (2005)
FACTS:Two ordinances were enacted by the Sangguniang Panlungsod of
Lucena with the objective of alleviating the traffic congestion said to have been
caused by the existence of various bus and jeepney terminals within the city.
City Ordinance 1631 grants 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. City Ordinance 1778, on the other
hand, strips out all the temporary terminals in the City of Lucena the right to
operate which as a result favors only the Lucena Grand Central Terminal, Inc.
The Regional Trial Court of Lucena declared City Ordinance 1631 as a valid
excercise of police power while declaring City Ordinance 1778 as null and void
for being invalid. Petitioner Lucena Grand Central Terminal, Inc. filed its Motion
for Reconsideration which was denied. Lucena then elevated it via petition for
review under Rule 45 before the Court. The Court referred the petition to the
Court of Appeals (CA) with which it has concurrent jurisdiction. The CA
dismissed the petition and affirmed the challenged orders of the trial court. Its
motion for reconsideration having been denied by the CA, Lucena now comes
to the Court via petition for review to assail the Decision and Resolution of the
CA.
ISSUE: Whether or not the means employed by the Lucena Sannguniang
Panlungsod to attain its professed objective were reasonably necessary and
not duly oppressive upon individuals.
HELD: With the aim of localizing the source of traffic congestion in the city to a
single location, 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 Lucena. The common carriers
plying routes to and from Lucena City are thus compelled to close down their
existing terminals and use the facilities of Lucena. 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. A due deference to the rights of the AN ORDINANCE PROHIBITING THE ESTABLISHMENT OR OPERATION OF
individual thus requires a more careful formulation of solutions to societal BUSINESSES PROVIDING CERTAIN FORMS OF AMUSEMENT,
problems. From the memorandum filed before the Court by Lucena, it is ENTERTAINMENT, SERVICES AND FACILITIES IN THE ERMITA-MALATE
gathered that the Sangguniang Panlungsod had identified the cause of AREA, PRESCRIBING PENALTIES FOR VIOLATION THEREOF, AND FOR
traffic congestion to be the indiscriminate loading and unloading of passengers OTHER PURPOSES.
by buses on the streets of the city proper, hence, the conclusion that the Judge Laguio rendered the assailed Decision (in favour of respondent).
terminals contributed to the proliferation of buses obstructing traffic on the city On 11 January 1995, petitioners filed the present Petition, alleging that the
streets. Bus terminals per se do not, however, impede or help impede the flow following errors were committed by the lower court in its ruling:
of traffic. How the outright proscription against the existence of all terminals, (1) It erred in concluding that the subject ordinance is ultra vires, or otherwise,
apart from that franchised to Lucena, can be considered as reasonably unfair, unreasonable and oppressive exercise of police power;
necessary to solve the traffic problem, the Court has not been enlightened. If (2) It erred in holding that the questioned Ordinance contravenes P.D. 499
terminals lack adequate space such that bus drivers are compelled to load and which allows operators of all kinds of commercial establishments, except those
unload passengers on the streets instead of inside the terminals, then specified therein; and
reasonable specifications for the size of terminals could be instituted, with (3) It erred in declaring the Ordinance void and unconstitutional.
permits to operate the same denied those which are unable to meet the
specifications. In the subject ordinances, however, the scope of the proscription ISSUE: WON the ordinance is unconstitutional.
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 HELD: The Court is of the opinion, and so holds, that the lower court did not
operating at all. The Court is not unaware of the resolutions of various err in declaring the Ordinance, as it did, ultra vires and therefore null and void.
barangays in Lucena City supporting the establishment of a common terminal, The tests of a valid ordinance are well established. A long line of decisions has
and similar expressions of support from the private sector, copies of which were held that for an ordinance to be valid, it must not only be within the corporate
submitted to this Court by Lucena Grand Central Terminal, Inc. The weight of powers of the local government unit to enact and must be passed according to
popular opinion, however, must be balanced with that of an individual‘s rights. the procedure prescribed by law, it must also conform to the following
substantive requirements:
CITY OF MANILA VS. LAGUIO (1) must not contravene the Constitution or any statute;
(2) must not be unfair or oppressive;
FACTS: Private respondent Malate Tourist Development Corporation (MTDC) (3) must not be partial or discriminatory;
is a corporation engaged in the business of operating hotels, motels, hostels (4) must not prohibit but may regulate trade;
and lodging houses. It built and opened Victoria Court in Malate which was (5) must be general and consistent with public policy; and
licensed as a motel although duly accredited with the DOT as a hotel. On 28 (6) must not be unreasonable.
June 1993, MTDC filed a Petition for Declaratory Relief with Prayer for a Writ The Ordinance was passed by the City Council in the exercise of its police
of Preliminary Injunction and/or Temporary Restraining Order7 with the lower power, an enactment of the City Council acting as agent of Congress. This
court impleading as defendants, herein petitioners City of Manila, Hon. Alfredo delegated police power is found in Section 16 of the LGC, known as the general
S. Lim (Lim), Hon. Joselito L. Atienza, and the members of the City Council of welfare clause.
Manila (City Council). MTDC prayed that the Ordinance, insofar as it includes The inquiry in this Petition is concerned with the validity of the exercise of such
motels and inns as among its prohibited establishments, be declared invalid delegated power.
and unconstitutional.
Enacted by the City Council and approved by petitioner City Mayor, the said A. The Ordinance contravenes
Ordinance is entitled– the Constitution
The enactment of the Ordinance was an invalid exercise of delegated power
as it is unconstitutional and repugnant to general laws.
The police power granted to LGUs must always be exercised with utmost
observance of the rights of the people to due process and equal protection of
the law. Due process requires the intrinsic validity of the law in interfering with
the rights of the person to his life, liberty and property.
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.
Lacking a concurrence of these two requisites, the police measure shall be
struck down as an arbitrary intrusion into private rights a violation of the due
process clause.
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.
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 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 sexual disease in Manila.
The enumerated establishments are lawful pursuits which are not per se
offensive to the moral welfare of the community. 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 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; and it may even impose increased license fees.
In other words, there are other means to reasonably accomplish the desired
end.
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.
Modality employed is
unlawful taking
It 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
recognized as a taking of the property without just compensation.78 It is
intrusive and violative of the private property rights of individuals.
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.
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.
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.
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. It is apparent that the Ordinance 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 businessesare 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.
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.
Further, 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. 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.
B. The Ordinance violates Equal
Protection Clause
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 prostitutionone of the hinted ills the Ordinance aims to
banishis not a profession exclusive to women. Both men and women have
an equal 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 (Sec 458) as the latter merely
empowers local government units to regulate, and not prohibit, the
establishments enumerated in Section 1 thereof.
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 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.
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.
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 the Ordinance and is therefore ultra vires, null
and void.
Petition Denied.