CONSTITUTIONAL LAW II POLICE POWER

MMDA versus VIRON TRANSPORTATION CO., INC.

G.R. No. 170656
Facts: Due to the continuing traffic jams that clog the streets of Metro Manila, former President Gloria
Macapagal Arroyo issued the E.O. on February 10, 2003, "Providing for the Establishment of Greater Manila
Mass Transport System which states that;
Section 3. PROJECT IMPLEMENTING AGENCY – The Metropolitan Manila Development Authority
(MMDA) is hereby designated as the implementing Agency for the project. For this purpose, MMDA is
directed to undertake such infrastructure development work as may be necessary and, thereafter, manage
the project until it may be turned-over to more appropriate agencies, if found suitable and convenient.
Specifically, MMDA shall have the following functions and responsibilities:
a) Cause the preparation of the Master Plan for the projects, including the designs and costing;
b) Coordinate the use of the land and/or properties needed for the project with the respective
agencies and/or entities owning them;
c) Supervise and manage the construction of the necessary structures and facilities;
d) Execute such contracts or agreements as may be necessary, with the appropriate government
agencies, entities, and/or private persons, in accordance with existing laws and pertinent
regulations, to facilitate the implementation of the project;
e) Accept, manage and disburse such funds as may be necessary for the construction and/or
implementation of the projects, in accordance with prevailing accounting and audit polices and
practice in government.
f) Enlist the assistance of any national government agency, office or department, including local
government units, government-owned or controlled corporations, as may be necessary;
g) Assign or hire the necessary personnel for the above purposes; and
h) Perform such other related functions as may be necessary to enable it to accomplish the
objectives and purposes of this Executive Order.
The E.O. thus designated the MMDA as the implementing agency for the Project. Pursuant to the E.O., the
Metro Manila Council (MMC), the governing board and policymaking body of the MMDA, issued Resolution
No. 03-07 series of 2003 expressing full support of the Project. Recognizing the imperative to integrate the
different transport modes via the establishment of common bus parking terminal areas, the MMC cited the
need to remove the bus terminals located along major thoroughfares of Metro Manila.

Issue: Whether the E.O. was an unreasonable exercise of police power?

Held: For the faithful execution of the laws under Article VII, Section 17 of the Constitution which provides:
Section 17: The President shall have control of all the executive departments, bureaus and offices. He shall
ensure that the laws be faithfully executed.
Police power is the plenary power vested in the legislature to make, ordain, and establish wholesome and
reasonable laws, statutes and ordinances, not repugnant to the Constitution, for the good and welfare of
the people. This power to prescribe regulations to promote the health, morals, education, good order or
safety, and general welfare of the people flows from the recognition that salus populi est suprema lex ─ the
welfare of the people is the supreme law.

While police power rests primarily with the legislature, such power may be delegated, as it is in fact
increasingly being delegated. By virtue of a valid delegation, the power may be exercised by the President
and administrative boards as well as by the lawmaking bodies of municipal corporations or local
governments under an express delegation by the Local Government Code of 1991.

1
CONSTITUTIONAL LAW II POLICE POWER

The authority of the President to order the implementation of the Project notwithstanding, the designation
of the MMDA as the implementing agency for the Project may not be sustained. It is ultra vires, there being
no legal basis there for.

It bears stressing that under the provisions of E.O. No. 125, as amended, it is the DOTC, and not the
MMDA, which is authorized to establish and implement a project such as the one subject of the cases at
bar. Thus, the President, although authorized to establish or cause the implementation of the Project, must
exercise the authority through the instrumentality of the DOTC which, by law, is the primary implementing
and administrative entity in the promotion, development and regulation of networks of transportation, and
the one so authorized to establish and implement a project such as the Project in question.

Justice Emilio A. Gancayco vs. City Government of Quezon City & MMDA
G.R. No. 177807 October 11, 2011

Facts: Retired Justice Emilio A. Gancayco bought a parcel of land located EDSA,3 Quezon City. A few
years later, the Quezon City Council issued Ordinance No. 2904, entitled "An Ordinance Requiring the
Construction of Arcades, for Commercial Buildings to be Constructed in Zones Designated as Business
Zones in the Zoning Plan of Quezon City, and Providing Penalties in Violation Thereof. It required the
relevant property owner to construct an arcade along EDSA. An arcade is defined as any portion of a
building above the first floor projecting over the sidewalk beyond the first storey wall used as protection for
pedestrians against rain or sun. It bears emphasis that at the time Ordinance No. 2904 was passed by the
city council, there was yet no building code passed by the national legislature. Thus, the regulation of the
construction of buildings was left to the discretion of local government units. Under this particular ordinance,
the city council required that the arcade is to be created by constructing the wall of the ground floor facing
the sidewalk a few meters away from the property line. Thus, the building owner is not allowed to construct
his wall up to the edge of the property line, thereby creating a space or shelter under the first floor. In effect,
property owners relinquish the use of the space for use as an arcade for pedestrians, instead of using it for
their own purposes.

The ordinance covered the property of Justice Gancayco. Subsequently, Justice Gancayco sought the
exemption of a two-storey building being constructed on his property from the application of Ordinance No.
2904 that he be exempted from constructing an arcade on his property. The City Council acted favorably
on Justice Gancayco’s request "subject to the condition that upon notice by the City Engineer, the owner
shall, within reasonable time, demolish the enclosure of said arcade at his own expense when public interest
so demands."

The MMDA then sent a notice of demolition to Justice Gancayco alleging that a portion of his building
violated the National Building Code of the Philippines in relation to Ordinance No. 2904. He did not comply
with the notice. The MMDA then proceeded to demolish the party wall of the ground floor structure. The
City Government of Quezon City claimed that the ordinance was a valid exercise of police power, regulating
the use of property in a business zone.

Justice Gancayco filed a Petition with prayer for a temporary restraining order and/or writ of preliminary
injunction. The RTC ruled that the ordinance was unconstitutional. The Court of Appeals reversed the RTC’s

2
CONSTITUTIONAL LAW II POLICE POWER

decision and ruled that the ordinance was a valid exercise of the right of the local government unit to
promote the general welfare of its constituents pursuant to its police powers.

Issue: Whether Ordinance No. 2094 is a valid exercise of police power.

Held: Yes, it is a valid delegation of Police Power

Ratio: Police power is an inherent attribute of sovereignty. It has been defined as the power vested by the
Constitution in the legislature to make, ordain, and establish all manner of wholesome and reasonable laws,
statutes and ordinances, either with penalties or without, not repugnant to the Constitution, as they shall
judge to be for the good and welfare of the commonwealth, and for the subjects of the same. The power is
plenary and its scope is vast and pervasive, reaching and justifying measures for public health, public
safety, public morals, and the general welfare. In the exercise of police power, property rights of individuals
may be subjected to restraints and burdens in order to fulfil the objectives of the government.
For this reason, when the conditions so demand as determined by the legislature, property rights must bow
to the primacy of police power because property rights, though sheltered by due process, must yield to
general welfare.

Police power as an attribute to promote the common good would be diluted considerably if on the mere
plea of petitioners that they will suffer loss of earnings and capital, the questioned provision is invalidated.
Moreover, in the absence of evidence demonstrating the alleged confiscatory effect of the provision in
question, there is no basis for its nullification in view of the presumption of validity which every law has in
its favor.

It is clear that the primary objectives of the city council of Quezon City when it issued the questioned
ordinance ordering the construction of arcades were the health and safety of the city and its inhabitants;
the promotion of their prosperity; and the improvement of their morals, peace, good order, comfort, and the
convenience. At the time that the ordinance was passed, there was no national building code enforced to
guide the city council; thus, there was no law of national application that prohibited the city council from
regulating the construction of buildings, arcades and sidewalks in their jurisdiction.

Tano vs Socrates
GR No. 110249 August 21, 1997

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?

3
CONSTITUTIONAL LAW II POLICE POWER

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.

CITY OF MANILA VS. LAGUIO, JR.

GR # 118127, April 12, 2005

FACTS: Manila Ordinance No. 7738, prohibiting the establishment or operation of businesses providing
certain forms of amusement, entertainment, services and facilities in the Ermita-Malate area, to include
motels and inns, was enacted by herein petitioners contending that the said ordinance is a valid exercise
of the police power of the State in order to protect the social and moral welfare of the community.
Respondent Malate Tourist Development Corporation (MTDC) assailed the ordinance as an invalid exercise
of police power on the grounds that the Local Government Code grants the City Council only with the power
to regulate the establishment, operation and maintenance of hotels, motels, inns, pension houses, lodging
houses and other similar establishments, but not to prohibit them.

ISSUE: Whether or not Ordinance No. 7783 of the City of Manila is a valid exercise of police power.

HELD: Petition denied. The assailed ordinance is unreasonable and oppressive. An ordinance which
permanently restricts the use of property that it cannot be used for any reasonable purpose goes beyond
the regulation and must be recognized as a taking of the property without just compensation. It is an
exercise of police power that is violative of the private property rights of individuals.

Fernando vs St. Scholastica’s College

GR 1611107, 12 March 2013

Facts: Respondent SSC’s property is enclosed by a tall concrete perimeter fence. Marikina City enacted
an ordinance which provides that walls and fences shall not be built within a five-meter allowance between
the front monument line and the building line of an establishment.

4
CONSTITUTIONAL LAW II POLICE POWER

The City Government of Marikina sent a letter to the respondents ordering them to demolish, replace, and
move back the fence. As a response, the respondents filed a petition for prohibition with an application for
a writ of preliminary injunction and temporary restraining order before the Regional Trial Court of Marikina.
The RTC granted the petition and the CA affirmed. Hence, this certiorari.

Issue: Is Marikina Ordinance No. 192, imposing a five-meter setback, a valid exercise of police power?

Ruling: No. “Police power is the plenary power vested in the legislature to make statutes and ordinances
to promote the health, morals, peace, education, good order or safety and general welfare of the people.”
Two tests have been used by the Court – the rational relationship test and the strict scrutiny test:
Under the rational relationship test, an ordinance must pass the following requisites:
(1) the interests of the public generally, as distinguished from those of a particular class, require its
exercise; and (2) the means employed are reasonably necessary for the accomplishment of the purpose
and not unduly oppressive upon individuals.

The real intent of the setback requirement was to make the parking space free for use by the public and
not for the exclusive use of respondents. This would be tantamount to a taking of private property for public
use without just compensation. Anent the objectives of prevention of concealment of unlawful acts and “un-
neighborliness” due to the walls and fences, the parking area is not reasonably necessary for the
accomplishment of these goals. The Court, thus, finds Section 5 of the Ordinance to be unreasonable and
oppressive. Hence, the exercise of police power is not valid.

SOUTHERN LUZON DRUG CORPORATION, vs. DSWD, et al. Respondents

G.R. No. 199669
April 25, 2017

FACTS: The case at bar is a Petition for Review on Certiorari assailing the Decision of the Court of Appeals
which dismissed the petition for prohibition filed by Southern Luzon Drug Corporation (petitioner) against
the Department of Social Welfare and Development , the National Council for the Welfare of Disabled
Persons (now National Council on Disability Affairs or NCDA), the Department of Finance and the Bureau
of Internal Revenue (collectively, the respondents), which sought to prohibit the implementation of Section
4(a) of Republic Act (R.A.) No. 9257, otherwise known as the "Expanded Senior Citizens Act of 2003" and
Section 32 of R.A. No. 9442, which amends the "Magna Carta for Disabled Persons," particularly the
granting of 20% discount on the purchase of medicines by senior citizens and persons with disability (PWD),
respectively, and treating them as tax deduction due to the reason that claiming it affects the profitability of
their business.

The petitioner is a domestic corporation engaged in the business of drugstore operation in the Philippines
while the respondents are government' agencies, office and bureau tasked to monitor compliance with
R.A. Nos. 9257 and 9442, promulgate implementing rules and regulations for their effective implementation,
as well as prosecute and revoke licenses of erring establishments.

ISSUE: WON the assailed law is a valid exercise of police power.

5
CONSTITUTIONAL LAW II POLICE POWER

DECISION: It is in the exercise of its police power that the Congress enacted R.A. Nos. 9257 and 9442,
the laws mandating a 20% discount on purchases of medicines made by senior citizens and PWDs. It is
also in further exercise of this power that the legislature opted that the said discount be claimed as tax
deduction, rather than tax credit, by covered establishments.

The petitioner, however, claims that the change in the tax treatment of the discount is illegal as it constitutes
taking without just compensation. It even submitted financial statements for the years 2006 and 2007 to
support its claim of declining profits when the change in the policy was implemented.

The Court is not swayed.

To begin with, the issue of just compensation finds no relevance in the instant case as it had already been
made clear in Carlos Superdrug that the power being exercised by the State in the imposition of senior
citizen discount was its police power. Unlike in the exercise of the power of eminent domain, just
compensation is not required in wielding police power. This is precisely because there is no taking involved,
but only an imposition of burden.

In Manila Memorial Park, Inc., et al. v. Secretary of the DSWD, et al., 36 the Court ruled that by examining
the nature and the effects of R.A. No. 9257, it becomes apparent that the challenged governmental act was
an exercise of police power.

In the exercise of police power, "property rights of private individuals are subjected to restraints and burdens
in order to secure the general comfort, health, and prosperity of the State."38 Even then, the State's claim
of police power cannot be arbitrary or unreasonable. After all, the overriding purpose of the exercise of the
power is to promote general welfare, public health and safety, among others. It is a measure, which by
sheer necessity, the State exercises, even to the point of interfering with personal liberties or property rights
in order to advance common good. To warrant such interference, two requisites must concur: (a) the
interests of the public generally, as distinguished from those of a particular class, require the interference
of the! State; and (b) the means employed are reasonably necessary to the: attainment of the object sought
to be accomplished and not unduly oppressive upon individuals. In other words, the proper exercise of the
police power requires the concurrence of a lawful subject and a lawful method.39

SOCIAL JUSTICE SOCIETY VS ATIENZA

545 scra 92; G.R. No. 156052; February 13, 2008

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.

6
CONSTITUTIONAL LAW II POLICE POWER

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:

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;
The depot is open to attack through land, water or air;
It is situated in a densely populated place and near Malacañang Palace and
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.

CARLOS SUPERDRUG CORP. VS DSWD ET.AL. (2007)

526 SCRA 130; G.R. No. 166494; June 29, 2007

FACTS: Petitioners are domestic corporations and proprietors operating pharmacies in the Philippines.
Public respondents, on the other hand, include the DSWD, DOH, DOF, DOJ, and the DILG, specifically
tasked to monitor the drugstores’ compliance with the law; promulgate the implementing rules and
regulations for the effective implementation of the law; and prosecute and revoke the licenses of erring
drugstore establishments.

On 2004, R.A. No. 9257, amending R.A. No. 7432, was signed into law by President Gloria Macapagal-
Arroyo, otherwise known as the “Expanded Senior Citizens Act of 2003.” Sec. 4(a) of the Act states that:

SEC. 4. Privileges for the Senior Citizens. – The senior citizens shall be entitled to the following:
(a) the grant of twenty percent (20%) discount from all establishments relative to the utilization of
services in hotels and similar lodging establishments, restaurants and recreation centers, and
purchase of medicines in all establishments for the exclusive use or enjoyment of senior citizens,
including funeral and burial services for the death of senior citizens;

7
CONSTITUTIONAL LAW II POLICE POWER

Petitioners assail the said Act because it allegedly constitutes deprivation of private property and compelling
drugstore owners and establishments to grant the discount will result in a loss of profit and capital.

ISSUE: Whether Sec. 4(a) of the “Expanded Senior Citizens Act of 2003” is constitutional.

HELD: Yes. The law is a legitimate exercise of police power which, similar to the power of eminent domain,
has general welfare for its object.The State, in promoting the health and welfare of a special group of
citizens, can impose upon private establishments the burden of partly subsidizing a government program.
The Senior Citizens Act was enacted primarily to maximize the contribution of senior citizens to nation-
building, and to grant benefits and privileges to them for their improvement and well-being as the State
considers them an integral part of our society.

Police power has been described as “the most essential, insistent and the least limitable of powers,
extending as it does to all the great public needs.” For this reason, when the conditions so demand as
determined by the legislature, property rights must bow to the primacy of police power because property
rights, though sheltered by due process, must yield to general welfare.

MANILA MEMORIAL PARK, INC v. SECRETARY OF DSWD

711 SCRA 302 G.R. No. 175356 December 3, 2013

FACTS: RA 7432 was passed into law (amended by RA 9257), granting senior citizens 20% discount on
certain establishments.

To implement the tax provisions of RA 9257, the Secretary of Finance and the DSWD issued its own Rules
and Regulations.

Hence, this petition.

Petitioners are not questioning the 20% discount granted to senior citizens but are only assailing the
constitutionality of the tax deduction scheme prescribed under RA 9257 and the implementing rules and
regulations issued by the DSWD and the DOF.

Petitioners posit that the tax deduction scheme contravenes Article III, Section 9 of the Constitution, which
provides that: "private property shall not be taken for public use without just compensation.
Respondents maintain that the tax deduction scheme is a legitimate exercise of the State’s police power.

ISSUE: Whether the legally mandated 20% senior citizen discount is an exercise of police power or eminent
domain.

RULING: The 20% senior citizen discount is an exercise of police power.

It may not always be easy to determine whether a challenged governmental act is an exercise of police
power or eminent domain. The judicious approach, therefore, is to look at the nature and effects of the
challenged governmental act and decide on the basis thereof.

8
CONSTITUTIONAL LAW II POLICE POWER

The 20% discount is intended to improve the welfare of senior citizens who, at their age, are less likely to
be gainfully employed, more prone to illnesses and other disabilities, and, thus, in need of subsidy in
purchasing basic commodities. It serves to honor senior citizens who presumably spent their lives on
contributing to the development and progress of the nation.

In turn, the subject regulation affects the pricing, and, hence, the profitability of a private establishment.
The subject regulation may be said to be similar to, but with substantial distinctions from, price control or
rate of return on investment control laws which are traditionally regarded as police power measures.

The subject regulation differs there from in that (1) the discount does not prevent the establishments from
adjusting the level of prices of their goods and services, and (2) the discount does not apply to all customers
of a given establishment but only to the class of senior citizens. Nonetheless, to the degree material to the
resolution of this case, the 20% discount may be properly viewed as belonging to the category of price
regulatory measures which affect the profitability of establishments subjected thereto. On its face, therefore,
the subject regulation is a police power measure.

Drugstores Association of the Philippines, Inc. v NCDA

G.R. No. 194561, Sept. 14, 2016

Facts: On March 24, 1992, Republic Act (R.A.) No. 7277, the "Magna Carta for Disabled Persons," was
passed into law. The law defines "disabled persons", "impairment" and "disability." On April 30, 2007,
Republic Act No. 94427 ("Magna Carta for Persons with Disability") was enacted amending RA 7277.
Specifically, Sec. 32 of RA 9442 granted the PWDs a 20% discount on the purchase of medicine (upon
submission as proof of his/her entitlement thereto: ID issued by mayor or brgy. captain, passport, or
transportation discount fare ID from the National Council for the Welfare of Disabled persons) and a tax
deduction scheme was adopted wherein covered establishments may deduct the discount granted from
gross income based on the net cost of goods sold or services rendered. The Implementing Rules and
Regulations (IRR) of RA 9442 (Sec. 6 Rule IV pertains to Other Privileges and Incentives, including the
purchase of medicine) was jointly promulgated by several government agencies.

On April 23, 2008, the NCDA issued Administrative Order (A.O.) No. 1, Series of 2008, prescribing
guidelines which should serve as a mechanism for the issuance of a PWD Identification Card (IDC) which
shall be the basis for providing privileges and discounts to bonafide PWDs. On December 9, 2008, the DOF
issued Revenue Regulations No. 1- 2009 prescribing rules and regulations to implement R.A. 9442 relative
to the tax privileges of PWDs and tax incentives for establishments granting the discount. On May 20, 2009,
the DOH issued A.O. No. 2009-0011 specifically stating that the grant of 20% discount shall be provided in
the purchase of branded medicines and unbranded generic medicines from all establishments dispensing
medicines for the exclusive use of the PWDs.

On July 28, 2009, petitioners filed a Petition for Prohibition with application for a TRO/WPI before the CA
to annul and enjoin the implementation of the 5 laws abovementioned (in bold). On July 26, 2010, the CA
rendered a Decision upholding the constitutionality of RA 7277 as amended, as well as the assailed
administrative issuances.

9
CONSTITUTIONAL LAW II POLICE POWER

Issues: WON the CA erred in ruling the PWD discount as a valid exercise of police power instead of an
invalid exercise of the power of eminent domain (because it fails to provide just compensation to petitioners)

Ratio: We deny the petition.

The CA is correct when it applied by analogy the case of Carlos Superdrug Corporation et al. v. DSWD, et
al. wherein We pronounced that Sec. 4 of RA 9257 which grants 20% discount on the purchase of medicine
of senior citizens is a legitimate exercise of police power. Police power is the power of the state to promote
public welfare by restraining and regulating the use of liberty and property. On the other hand, the power
of eminent domain is the inherent right of the state (and of those entities to which the power has been
lawfully delegated) to condemn private property to public use upon payment of just compensation. In the
exercise of police power, property rights of private individuals are subjected to restraints and burdens in
order to secure the general comfort, health, and prosperity of the state. A legislative act based on the police
power requires the concurrence of a lawful subject and a lawful method.

The priority given to PWDs finds its basis in the Constitution (Sec. 6 Art XII and Sec. 11 Art XIII). Thus, the
Declaration of Policy (Sec. 2) of RA 7277 recognizes that disabled persons are part of the Philippine society,
to whom the Senate shall give full support for the improvement of their total well-being and their integration
into the mainstream of society. The State shall adopt policies ensuring the rehabilitation, self-development
and self-reliance of disabled persons. Hence, the PWD mandatory discount on the purchase of medicine is
supported by a valid objective or purpose. As in the case of senior citizens, the discount privilege to which
the PWDs are entitled is actually a benefit enjoyed by the general public to which these citizens belong.
The means employed in invoking the active participation of the private sector, in order to achieve the
purpose or objective of the law, is reasonably and directly related. Also, the means employed to provide a
fair, just and quality health care to PWDs are reasonably related to its accomplishment, and are not
oppressive, considering that as a form of reimbursement, the discount extended to PWDs in the purchase
of medicine can be claimed by the establishments as allowable tax deductions.

MERALCO VS Sps. RAMOS

G.R. no 195145, Feb 10, 2016

Facts: MERALCO entered into a contract of service with the respondents agreeing to supply the latter with
electric power in their residence. On November 5, 1999, MERALCO's service inspector inspected the
respondents' electrical facilities and found an outside connection attached to their electric meter. Due to
the discovery of the illegal connection, the service inspector disconnected the respondents' electric
services on the same day. The inspection and disconnection were done without the knowledge of the
respondents as they were not at home and their house was closed at the time. The respondents denied
that they had been, using an illegal electrical connection and they requested MERALCO to immediately
reconnect their electric services. Despite the respondents' request, MERALCO instead demanded from
them the payment of P179,231.70 as differential billing. On December 20, 1999, the respondents filed a
complaint for breach of contract with preliminary mandatory injunction and damages against MERALCO
before the RTC. They prayed for the immediate reconnection of their electric service and the award of
actual, moral, and exemplary damages, attorney's fees, and litigation expenses.

The RTC ordered MERALCO to reconnect the respondents' electric service and awarded damages.
MERALCO appealed the RTC's decision to the CA.

10
CONSTITUTIONAL LAW II POLICE POWER

The CA denied the appeal for lack of merit and affirmed the RTC's order of reconnection and award for
payment of damages. The appellate court held that MERALCO failed to comply not only with its own
contract of service, but also with the requirements under Sections 4 and 6 of Republic Act No. 7832, or the
Anti-Electricity and Electric Transmission Lines/Materials Pilferage Act of 1994 (R.A. 7832), when it
resorted to the immediate disconnection of the respondents' electric service without due notice
Issue: Whether MERALCO had the right to immediately disconnect the electric service of the respondents
upon discovery of an outside connection attached to their electric meter.
Decision:
The distribution of electricity is a basic necessity that is imbued with public interest. Its provider is
considered as a public utility subject to the strict regulation by the State in the exercise of its police
power. Failure to comply with these regulations gives rise to the presumption of bad faith or abuse of right.
Nevertheless, the State also recognizes that electricity is the property of the service provider. R.A. 7832
was enacted by Congress to afford electric service providers multiple remedies to protect themselves from
electricity pilferage. These remedies include the immediate disconnection of the electric service of an erring
customer, criminal prosecution, and the imposition of surcharges. However, the service provider must
avail of any or all of these remedies within legal bounds, in strict compliance with the requirements
and/or conditions set forth by law.

Section 4(a) of R.A. 7832 provides that the discovery of an outside connection attached on the electric
meter shall constitute as prima facie evidence of illegal use of electricity by the person who benefits from
the illegal use if the discovery is personally witnessed and attested to by an officer of the law or a duly
authorized representative of the Energy Regulatory Board (ERB). With the presence of such prima facie
evidence, the electric service provider is within its rights to immediately disconnect the electric service of
the consumer after due notice.

Additionally, Section 6 of R.A. 7832 affords a private electric utility the right and authority to immediately
disconnect the electric service of a consumer who has been caught in flagrante delicto doing any of the
acts covered by Section 4(a). However, the law clearly states that the disconnection may only be done
after serving a written notice or warning to the consumer.

In view of MERALCO's failure to comply with the strict requirements under Sections 4 and 6 of R. A. No.
7832, we hold that MERALCO had no authority to immediately disconnect the respondents' electric
service. As a result, the immediate disconnection of the respondents' electric service is presumed
to be in bad faith.

ASSOCIATION OF MEDICAL CLINICS FOR OVERSEAS WORKERS v. GCC APPROVED MEDICAL

CENTERS ASSOCIATION (GAMCA)
GR No. 207132, 2016-12-06

Facts: On March 8, 2001, the DOH issued Administrative Order No. 5, Series of 2001 (AO 5-01) which
directed the decking or equal distribution of migrant workers among the several clinics who are members
of GAMCA.

11
CONSTITUTIONAL LAW II POLICE POWER

Subsequently, the DOH issued AO No. 106, Series of 2002... holding in abeyance the implementation of
the referral decking system. The DOH reiterated its directive suspending the referral decking system in AO
No. 159, Series of 2004.

In 2004, the DOH issued AO No. 167, Series of 2004... repealing AO 5-01, reasoning that the referral
decking system did not guarantee the migrant workers' right to safe and quality health service.

In Department Memorandum No. 2008-0210,... dated September 26, 2008, then DOH Secretary Francisco
T. Duque III expressed his concern about the continued implementation of the referral decking system
despite the DOH's prior suspension directives. The DOH directed the "OFW clinics, duly accredited/licensed
by the DOH and/or by the Philippine Health Insurance Corporation (PHILHEALTH) belonging to and
identified with GAMCA x x x to forthwith stop, terminate, withdraw or otherwise end the x x x 'referral decking
system.'"

GAMCA questioned the DOH's Memorandum No. 2008-0210 before the Office of the President (OP). In a
decision... dated January 14, 2010, the OP nullified Memorandum No. 2008-0210.
On March 8, 2010, Republic Act (RA) No. 10022... lapsed into law without the President's signature.
Section 16 of RA No. 10022 amended Section 23 of RA No. 8042, adding two new paragraphs - paragraphs
(c) and (d). The pertinent portions of the amendatory provisions read:

(c) Department of Health. - The Department of Health (DOH) shall regulate the activities and
operations of all clinics which conduct medical, physical, optical, dental, psychological and other
similar examinations, hereinafter referred to as health examinations, on Filipino migrant workers as
requirement for their overseas employment. Pursuant to this, the DOH shall ensure that:
(c.3) No group or groups of medical clinics shall have a monopoly of exclusively conducting health
examinations on migrant workers for certain receiving countries;(c.4) Every Filipino migrant worker
shall have the freedom to choose any of the DOH-accredited or DOH-operated clinics that will
conduct his/her health examinations and that his or her rights as a patient are respected. The
decking practice, which requires an overseas Filipino worker to go first to an office for registration
and then farmed out to a medical clinic located elsewhere, shall not be allowed;

On August 13, 2010, the Implementing Rules and Regulations (IRR) of RA No. 8042, as amended by RA
No. 10022, took effect.

Pursuant to Section 16 of RA No. 10022, the DOH, through its August 23, 2010 letter-order,... directed
GAMCA to cease and desist from implementing the referral decking system and to wrap up their operations
within three (3) days from receipt thereof. GAMCA received its copy of the August 23, 2010 letter-order on
August 25, 2010.

The RTC upheld the constitutionality of Section 16 of RA No. 10022, amending Section 23 of RA No. 8042,
but ruled that Section 16 of RA No. 10022 does not apply to GAMCA.

Issue: Whether the RTC made a reversible error of law when it issued writs of certiorari and prohibition
against the DOH CDO (Cease and desist orders) letters.

12
CONSTITUTIONAL LAW II POLICE POWER

Decision: The prohibition against the referral decking system under Section 16, RA No. 10022, is a
valid exercise of police power. As defined, police power includes (1) the imposition of restraint on liberty or
property, (2) in order to foster the common good. The exercise of police power involves the "state authority
to enact legislation that may interfere with personal liberty or property in order to promote the general
welfare." To be considered reasonable, the government's exercise of police power must satisfy the "valid
object and valid means" method of analysis: first, the interest of the public generally, as distinguished from
those of a particular class, requires interference; and second, the means employed are reasonably
necessary to attain the objective sought and not unduly oppressive upon individuals.

These two elements of reasonableness are undeniably present in Section 16 of RA No. 10022. The
prohibition against the referral decking system is consistent with the State's exercise of the police power to
prescribe regulations to promote the health, safety, and general welfare of the people. Public interest
demands State interference on health matters, since the welfare of migrant workers is a legitimate public
concern.

The DOH did not gravely abuse its discretion in issuing the assailed DOH CDO letters.

ST. LUKE’S MEDICAL CENTER EMPLOYEE’S FOUNDATION AFW v. NLRC

G.R. No. 162053 March 7, 2007

Facts: Congress passed and enacted Republic Act No. 7431 known as the “Radiologic Technology Act of
1992.” Said law requires that no person shall practice or offer to practice as a radiology and/or x-ray
technologist in the Philippines without having obtained the proper certificate of registration from the Board
of Radiologic Technology. Petitioner Maribel Santos was hired as X-Ray Technician in the Radiology
department of private respondent St. Luke’s Medical Center, Inc. (SLMC).

Pursuant to RA 7431 the assistant Executive Director-Ancillary Services and HR Director of private
respondent SLMC issued a final notice to all practitioners of Radiologic Technology to comply with the
requirement otherwise, the unlicensed employee will be transferred to an area which does not require a
license to practice if a slot is available.

The Director of the Institute of Radiology issued another memorandum to petitioner Maribel S. Santos
advising her that only a license can assure her of her continued employment at the Institute of Radiology
of the private respondent SLMC and that the latter is giving her the last chance to take and pass the
forthcoming board examination scheduled in June 1998; otherwise, private respondent SLMC shall be
constrained to take action which may include her separation from employment. On November 23, 1998,
the Director of the Institute of Radiology issued a notice to petitioner Maribel S. Santos informing the latter
that the management of private respondent SLMC has approved her retirement in lieu of separation pay.
SLMC issued a “Notice of Separation from the Company” to petitioner Maribel S. Santos effective
December 30, 1998 in view of the latter’s refusal to accept private respondent SLMC’s offer for early
retirement.

Petitioner Maribel Santos files a complaint against private respondent illegal dismissal and non-payment of
salaries, allowances and other monetary benefits. She further contends that her failure to pass the board
licensure exam for exam for X-ray technicians did not constitute just cause for termination as it violated her

13
CONSTITUTIONAL LAW II POLICE POWER

constitutional right to security of tenure. The appellate court finds this contention untenable, hence this
petition for certiorari.

Issue: Whether or not the petitioner is legally dismissed pursuant to R.A. 7431 exercising police power of
the State?

Held: Yes, the petitioner dismissal is valid due to her inability to secure a certificate of registration from
Board of Radiologic Technology.

While the right of workers to security of tenure is guaranteed by the Constitution, its exercise may be
reasonably regulated pursuant to the police power of the State to safeguard health, morals, peace,
education, order, safety, and the general welfare of the people. Consequently, persons who desire to
engage in the learned professions requiring scientific or technical knowledge may be required to take an
examination as a prerequisite to engaging in their chosen careers. The state is justified in prescribing the
specific requirements for x-ray technicians and/or any other professions connected with the health and
safety of its citizens. Respondent being engaged in the hospital and health care business, is a proper
subject of the cited law; thus, having in mind the legal requirements of these laws, the latter cannot close
its eyes and complainant private interest override public interest. The law is clear that the Certificate of
Registration cannot be substituted by any other requirement to allow a person to practice as a Radiologic
Technologist and/or X-ray Technologist (Technician).

14