NATURE OF POLICE POWER

PASEI vs Drilon Case Digest

PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS VS. DRILON
G.R. NO. L-81958
JUNE 30, 1988

FACTS: The Philippine Association of Service Exporters, Inc. (PASEI) challenges the
Constitutional validity of Department Order No. 1, Series of 1988, of the Department of
Labor and Employment, in the character of "GUIDELINES GOVERNING THE
TEMPORARY SUSPENSION OF DEPLOYMENT OF FILIPINO DOMESTIC AND
HOUSEHOLD WORKERS," in this petition for certiorari and prohibition. Specifically, the
measure is assailed for "discrimination against males or females;" that it "does not apply
to all Filipino workers but only to domestic helpers and females with similar skills;" and
that it is violative of the right to travel. It is held likewise to be an invalid exercise of the
lawmaking power, police power being legislative, and not executive, in character.

In its supplement to the petition, PASEI invokes Section 3, of Article XIII, of the
Constitution, providing for worker participation "in policy and decision-making processes
affecting their rights and benefits as may be provided by law." Department Order No. 1, it
is contended, was passed in the absence of prior consultations. It is claimed, finally, to
be in violation of the Charter's non-impairment clause, in addition to the "great and
irreparable injury" that PASEI members face should the Order be further enforced.

ISSUE: Whether or not the Department Order No. 1 in nature of the police power is valid
under the Constitution?

HELD: In the light of the foregoing, the petition must be dismissed.

As a general rule, official acts enjoy a presumed validity. In the absence of clear and
convincing evidence to the contrary, the presumption logically stands.

The petitioner has shown no satisfactory reason why the contested measure should be
nullified. There is no question that Department Order No. 1 applies only to "female
contract workers," but it does not thereby make an undue discrimination between the
sexes. It is well-settled that "equality before the law" under the Constitution does not
import a perfect Identity of rights among all men and women. It admits of classifications,
provided that (1) such classifications rest on substantial distinctions; (2) they are germane
to the purposes of the law; (3) they are not confined to existing conditions; and (4) they
apply equally to all members of the same class.

The Court is well aware of the unhappy plight that has befallen our female labor force
abroad, especially domestic servants, amid exploitative working conditions marked by
physical and personal abuse. As precisely the caretaker of Constitutional rights, the Court
is called upon to protect victims of exploitation. In fulfilling that duty, the Court sustains
the Government's efforts.

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The same, however, cannot be said of our male workers. In the first place, there is no
evidence that, except perhaps for isolated instances, our men abroad have been afflicted
with an identical predicament. Suffice it to state, then, that insofar as classifications are
concerned, this Court is content that distinctions are borne by the evidence.
Discrimination in this case is justified.

There is likewise no doubt that such a classification is germane to the purpose behind the
measure. Unquestionably, it is the avowed objective of Department Order No. 1 to
"enhance the protection for Filipino female overseas workers" this Court has no quarrel
that in the midst of the terrible mistreatment Filipina workers have suffered abroad, a ban
on deployment will be for their own good and welfare.

The Order does not narrowly apply to existing conditions. Rather, it is intended to apply
indefinitely so long as those conditions exist. This is clear from the Order itself ("Pending
review of the administrative and legal measures, in the Philippines and in the host
countries . . ."), meaning to say that should the authorities arrive at a means impressed
with a greater degree of permanency, the ban shall be lifted.

It is incorrect to say that Department Order No. 1 prescribes a total ban on overseas
deployment. From scattered provisions of the Order, it is evident that such a total ban has
not been contemplated.

The consequence the deployment ban has on the right to travel does not impair the right.
The right to travel is subject, among other things, to the requirements of "public safety,"
"as may be provided by law. Neither is there merit in the contention that Department Order
No. 1 constitutes an invalid exercise of legislative power. It is true that police power is the
domain of the legislature, but it does not mean that such an authority may not be lawfully
delegated. As we have mentioned, the Labor Code itself vests the Department of Labor
and Employment with rule-making powers in the enforcement whereof.

The non-impairment clause of the Constitution, invoked by the petitioner, must yield to
the loftier purposes targeted by the Government. Freedom of contract and enterprise, like
all other freedoms, is not free from restrictions, more so in this jurisdiction, where laissez
faire has never been fully accepted as a controlling economic way of life.

This Court understands the grave implications the questioned Order has on the business
of recruitment. The concern of the Government, however, is not necessarily to maintain
profits of business firms. In the ordinary sequence of events, it is profits that suffer as a
result of Government regulation. The interest of the State is to provide a decent living to
its citizens. The Government has convinced the Court in this case that this is its intent.
We do not find the impugned Order to be tainted with a grave abuse of discretion to
warrant the extraordinary relief prayed for

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MMDA vs VIRON TRANSPORTATION Case Digest

THE METROPOLITAN MANILA DEVELOPMENT AUTHORITY, et al. v. VIRON

TRANSPORTATION CO., INC., et al.
530 SCRA 341 (2007), EN BANC, (CARPIO MORALES, J.)

It is the DOTC, and not the MMDA, which is authorized to establish and implement
a project such as the mass transport system.

FACTS: To solve the worsening traffic congestions problem in Metro Manila the President
issued Executive Order (E.O.) 179, ―Providing for the Establishment of Greater Manila
Mass Transportation System. As determined in E.O. 179, the primary cause of traffic
congestion in Metro Manila has been the numerous buses plying the streets that impede
the flow of vehicles and commuters and the inefficient connectivity of the different
transport modes. To decongest traffic, petitioner Metropolitan Manila Development
Authority (MMDA) came up with a recommendation, proposing the elimination of bus
terminals located along major Metro Manila thoroughfares, and the construction of mass
transport terminal facilties to provide a more convenient access to mass transport system
to the commuting public.

The project provided for under this E.O. was called ―Greater Manila Transport System‖
(Project) wherein the MMDA was designated as the implementing agency. Accordingly,
the Metro Manila Council the governing board of the MMDA issued a resolution,
expressing full support of the project.

The respondents, which are engaged in the business of public transportation with a
provincial bus operation, Viron Transport Co., Inc. and Mencorp Transportation System,
Inc., assailed the constitutionality of E.O. 179 before the Regional Trial Court of Manila.
They alleged that the E.O., insofar as it permitted the closure of existing bus terminal,
constituted a deprivation of property without due process; that it contravened the Public
Service Act which mandates public utilities to provide and maintain their own terminals as
a requisite for the privilege of operating as common carriers; and that Republic Act 7924,
which created MMDA, did not authorize the latter to order the closure of bus terminals.
The trial court declared the E.O. unconstitutional.

The MMDA argued before the Court that there was no justiciable controversy in the case
for declaratory relief filed by the respondents; that E.O. 179 was only an administrative
directive to government agencies to coordinate with the MMDA, and as such did not bind
third persons; that the President has the authority to implement the Project pursuant to
E.O. 125; and that E.O. 179 was a valid exercise of police power.

ISSUE: Whether or not E.O, 179 is constitutional

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HELD: By designating the MMDA as implementing agency of the “Greater Manila
Transport System,” the President clearly overstepped the limits of the authority conferred
by law, rendering E.O. 179 ultra vires

Executive Order 125, invoked by the MMDA, was issued by former President Aquino in
her exercise of legislative powers. This executive order reorganized the Ministry (now
Department) of Transportation and Communications (DOTC), and defined its powers and
functions. It mandated the DOTC to be the primary policy, planning, programming,
coordinating, implementing, regulating and administrative entity to promote, develop and
regulate networks of transportation and communications.

The grant of authority to the DOTC includes the power to establish and administer
comprehensive and integrated programs for transportation and communications.
Accordingly, it is the DOTC Secretary who is authorized to issue such orders, rules,
regulations and other issuances as may be necessary to ensure the effective
implementation of the law. The President may also exercise the same power and authority
to order the implementation of the mass transport system project, which admittedly is one
for transportation. Such authority springs from the President‘s power of control over all
executive departments as well as for the faithful execution of the laws under the
Constitution.

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. It is the DOTC, and not the MMDA, which is
authorized to establish and implement a project such as the mass transport system. By
designating the MMDA as implementing agency of the Project, the President clearly
overstepped the limits of the authority conferred by law, rendering E.O. 179 ultra vires.

In the absence of a specific grant of authority to it under R.A. 7924, MMDA cannot issue
order for the closure of existing bus terminals Republic Act (R.A.) 7924 authorizes the
MMDA to perform planning, monitoring and coordinative functions, and in the process
exercises regulatory and supervisory authority over the delivery of metro-wide services,
including transport and traffic management. While traffic decongestion has been
recognized as a valid ground in the exercise of police power, MMDA is not granted police
power, let alone legislative power. Unlike the legislative bodies of the local government
units, there is no provision in R.A. 7924 that empowers the MMDA or the Metro Manila
Council to enact ordinances, approve resolutions and appropriate funds for the general
welfare of the inhabitants of Metro Manila.

In light of the administrative nature of its powers and functions, the MMDA is devoid of
authority to implement the Greater Manila Transport System as envisioned by E.O. 179;
hence, it could not have been validly designated by the President to undertake the project.
It follows that the MMDA cannot validly order the elimination of respondents‘ terminals.

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Even assuming arguendo that police power was delegated to the MMDA, its exercise of
such power does not satisfy the two sets of a valid police power measure: (1) the interest
of the public generally, as distinguished from that of a particular class, requires its
exercise; and (2) the means employed are reasonably necessary for the accomplishment
of the purpose and not unduly oppressive upon individuals.

In various cases, the Court has recognized that traffic congestion is a public, not merely
a private concern. Indeed, the E.O. was issued due to the felt need to address the
worsening traffic congestion in Metro Manila which, the MMDA so determined, is caused
by the increasing volume of buses plying the major thoroughfares and the inefficient
connectivity of existing transport system.

With the avowed objective of decongesting traffic in Metro Manila the E.O. seeks to
eliminate the bus terminals now located along major Metro Manila thoroughfares and
provide more convenient access to the mass transport system to the commuting public
through the provision of mass transport terminal facilities. Common carriers with terminals
along the major thoroughfares of Metro Manila would thus be compelled to close down
their existing bus terminals and use the MMDA-designated common parking areas. The
Court fails to see how the prohibition against respondents‘ terminals can be considered
a reasonable necessity to ease traffic congestion in the metropolis. On the contrary, the
elimination of respondents‘ bus terminals brings forth the distinct possibility and the
equally harrowing reality of traffic congestion in the common parking areas, a case of
transference from one site to another.

Moreover, an order for the closure of bus terminals is not in line with the provisions of the
Public Service Act. The establishment, as well as the maintenance of vehicle parking
areas or passenger terminals, is generally considered a necessary service by provincial
bus operators, hence, the investments they have poured into the acquisition or lease of
suitable terminal sites.

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G.R. No. 98332 January 16, 1995

MINERS ASSOCIATION OF THE PHILIPPINES, INC., petitioner, vs. HON.

FULGENCIO S. FACTORAN, JR., Secretary of Environment and Natural Resources, and
JOEL D. MUYCO, Director of Mines and Geosciences Bureau, respondents.

FACTS:

Pursuant to Section 6 of Executive Order No. 279, authorizing the DENR Secretary to
negotiate and conclude joint venture, co-production, or production-sharing agreements
for the exploration, development and utilization of mineral resources, and prescribing the
guidelines for such agreements and those agreements involving technical or financial
assistance by foreign-owned corporations for large-scale exploration, development, and
utilization of minerals, the DENR Secretary issued DENR Administrative Order No. 57,
series of 1989, entitled "Guidelines on Mineral Production Sharing Agreement under
Executive Order No. 279." Under the transitory provision of said DENR Administrative
Order No. 57, embodied in its Article 9, all existing mining leases or agreements which
were granted after the effectivity of the 1987 Constitution pursuant to Executive Order No.
211, except small scale mining leases and those pertaining to sand and gravel and quarry
resources covering an area of twenty (20) hectares or less, shall be converted into
production-sharing agreements within one (1) year from the effectivity of these guidelines.

The Secretary of the DENR then further issued DENR Administrative Order No. 82, series
of 1990, laying down the "Procedural Guidelines on the Award of Mineral Production
Sharing Agreement (MPSA) through Negotiation."

The issuance and the impending implementation by the DENR of Administrative Order
Nos. 57 and 82 after their respective effectivity dates compelled the Miners Association
of the Philippines, Inc. to file the instant petition assailing their validity and constitutionality
before this Court.

Petitioner Miners Association of the Philippines, Inc., mainly contends that the
administrative orders do not conform with Executive Order Nos. 211 and 279, petitioner
contends that both orders violate the non-impairment of contract provision under Article
III, Section 10 of the 1987 Constitution on the ground that Administrative Order No. 57
unduly pre-terminates existing mining leases and other mining agreements and
automatically converts them into production-sharing agreements within one (1) year from
its effectivity date. On the other hand, Administrative Order No. 82 declares that failure
to submit Letters of Intent and Mineral Production-Sharing Agreements within two (2)
years from the date of effectivity of said guideline or on July 17, 1991 shall cause the
abandonment of their mining, quarry and sand gravel permits.

Petitioner argued that Executive Order No. 279 does not contemplate automatic
conversion of mining lease agreements into mining production-sharing agreement as
provided under Article 9, Administrative Order No. 57 and/or the consequent
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abandonment of mining claims for failure to submit LOIs and MPSAs under Section 3,
Administrative Order No. 82 because Section 1 of said Executive Order No. 279
empowers the DENR Secretary to negotiate and enter into voluntary agreements which
must set forth the minimum terms and conditions provided under Section 2
thereof. Moreover, petitioner contends that the power to regulate and enter into mining
agreements does not include the power to preterminate existing mining lease
agreements.

ISSUE:

Whether or not DENR Administrative Order Nos. 57 and 82 issued by the DENR
Secretary are unconstitutional.

HELD:

NO. DENR Administrative Order Nos. 57 and 82 are not unconstitutional.

The questioned administrative orders are reasonably directed to the accomplishment of

the purposes of the law under which they were issued and were intended to secure the
paramount interest of the public, their economic growth and welfare. The validity and
constitutionality of Administrative Order Nos. 57 and 82 must be sustained, and their force
and effect upheld.

Administrative Order No. 57 applies only to all existing mining leases or agreements
which were granted after the effectivity of the 1987 Constitution pursuant to Executive
Order No. 211. It bears mention that under the text of Executive Order No. 211, there is
a reservation clause which provides that the privileges as well as the terms and conditions
of all existing mining leases or agreements granted after the effectivity of the 1987
Constitution, pursuant to Executive Order No. 211, shall be subject to any and all
modifications or alterations which Congress may adopt pursuant to Article XII, Section 2
of the 1987 Constitution. Hence, the strictures of the non-impairment of contract clause
under Article III, Section 10 of the 1987 Constitution do not apply to the aforesaid mining
leases or agreements granted after the effectivity of the 1987 Constitution, pursuant to
Executive Order No. 211. They can be amended, modified or altered by a statute passed
by Congress to achieve the purposes of Article XII, Section 2 of the 1987 Constitution.

Moreover, nowhere in Administrative Order No. 57 is there any provision which would
lead us to conclude that the questioned order authorizes the automatic conversion of
mining leases and agreements granted after the effectivity of the 1987 Constitution,
pursuant to Executive Order No. 211, to production-sharing agreements. The provision
in Article 9 of Administrative Order No. 57 that "all such leases or agreements shall be
converted into production sharing agreements within one (1) year from the effectivity of
these guidelines" could not possibly contemplate a unilateral declaration on the part of
the Government that all existing mining leases and agreements are automatically
converted into production-sharing agreements. On the contrary, the use of the term

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"production-sharing agreement" in the same provision implies negotiation between the
Government and the applicants, if they are so minded. Negotiation negates compulsion
or automatic conversion as suggested by petitioner in the instant petition. A mineral
production-sharing agreement (MPSA) requires a meeting of the minds of the parties
after negotiations arrived at in good faith and in accordance with the procedure laid
down in the subsequent Administrative Order No. 82.

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G.R. No. 177807/G.R. No. 177933 Case Digest
G.R. No. 177807/G.R. No. 177933, October 11, 2011
Emilio Gancayco
vs City Government of Quezon City and MMDA
Ponente: Sereno

Facts:

In 1950s, retired justice Emilio Gancayco bought a parcel of land

located in EDSA. Then on March 1956, Quezon City Council issued
Ordinance No. 2904 requiring the construction of arcades for
commercial buildings to be constructed. At the outset, 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, sometime in 1965, 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.
On 2 February 1966, the City Council acted favorably on Justice
Gancayco’s request and issued Resolution No. 7161, S-66, “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.”

Decades after, in March 2003, MMDA conducted operations to clear

obstructions along EDSA, in consequence, they sent a notice of
demolition to Justice Gancayco alleging that a portion of his
building violated the National Building Code.

Gancayco did not comply with the notice and filed a petition for
TRO with the RTC Quezon City to prohibit the MMDA from demolishing
his property. The RTC rendered its Decision on 30 September 2003

9|Page
in favor of Justice Gancayco. It held that the questioned ordinance
was unconstitutional, ruling that it allowed the taking of private
property for public use without just compensation. The RTC said
that because 67.5 square meters out of Justice Gancayco’s 375
square meters of property were being taken without compensation
for the public’s benefit, the ordinance was confiscatory and
oppressive. It likewise held that the ordinance violated owners’
right to equal protection of laws.

MMDA appealed with the CA. CA held that the MMDA went beyond its
powers when it demolished the subject property. It further found
that Resolution No. 02-28 only refers to sidewalks, streets,
avenues, alleys, bridges, parks and other public places in Metro
Manila, thus excluding Justice Gancayco’s private property.
Lastly, the CA stated that the MMDA is not clothed with the
authority to declare, prevent or abate nuisances.

Issues: (1) WHETHER OR NOT JUSTICE GANCAYCO WAS ESTOPPED FROM

ASSAILING THE VALIDITY OF ORDINANCE NO. 2904. (2) WHETHER OR NOT
ORDINANCE NO. 2904 IS CONSTITUTIONAL.(3) WHETHER OR NOT THE WING
WALL OF JUSTICE GANCAYCO’S BUILDING IS A PUBLIC NUISANCE. (4)
WHETHER OR NOT THE MMDA LEGALLY DEMOLISHED THE PROPERTY OF JUSTICE
GANCAYCO.

Ruling:

(1) We find that petitioner was not guilty of estoppel. When it

made the undertaking to comply with all issuances of the BIR, which
at that time it considered as valid, petitioner did not commit any
false misrepresentation or misleading act.
(2) Justice Gancayco may not question the ordinance on the ground
of equal protection when he also benefited from the exemption. It
bears emphasis that Justice Gancayco himself requested for an
exemption from the application of the ordinance in 1965 and was
eventually granted one. Moreover, he was still enjoying the
exemption at the time of the demolition as there was yet no valid
notice from the city engineer. Thus, while the ordinance may be
attacked with regard to its different treatment of properties that
appears to be similarly situated, Justice Gancayco is not the
proper person to do so.
(3) The fact that in 1966 the City Council gave Justice Gancayco
an exemption from constructing an arcade is an indication that the
wing walls of the building are not nuisances per se. The wing
walls do not per se immediately and adversely affect the safety of
persons and property. The fact that an ordinance may declare a
structure illegal does not necessarily make that structure a
nuisance. Clearly, when Justice Gancayco was given a permit to

10 | P a g e
construct the building, the city council or the city engineer did
not consider the building, or its demolished portion, to be a
threat to the safety of persons and property. This fact alone
should have warned the MMDA against summarily demolishing the
structure.

Sangguniang Bayan cannot declare a particular thing as a nuisance

per se and order its condemnation. It does not have the power to
find, as a fact, that a particular thing is a nuisance when such
thing is not a nuisance per se; nor can it authorize the
extrajudicial condemnation and destruction of that as a nuisance
which in its nature, situation or use is not such. Those things
must be determined and resolved in the ordinary courts of law.

MMDA illegally demolished Gancayco's property.

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U.S. Supreme Court
Jacobson v. Massachusetts, 197 U.S. 11 (1905)

Jacobson v. Massachusetts

No. 70

Argued December 6, 1904

Decided February 20, 1905

197 U.S. 11

Syllabus

The United States does not derive any of its substantive powers from the Preamble of
the Constitution. It cannot exert any power to secure the declared objects of the
Constitution unless, apart from the Preamble, such power be found in, or can properly
be implied from, some express delegation in the instrument.

While the spirit of the Constitution is to be respected not less than its letter, the spirit is
to be collected chiefly from its words.

While the exclusion of evidence in the state court in a case involving the constitutionality
of a state statute may not strictly present a Federal question, this court may consider
the rejection of such evidence upon the ground of incompetency or immateriality under
the statute as showing its scope and meaning in the opinion of the state court.

The police power of a State embraces such reasonable regulations relating to matters
completely within its territory, and not affecting the people of other States, established
directly by legislative enactment, as will protect the public health and safety.

While a local regulation, even if based on the acknowledged police power of a State,
must always yield in case of conflict with the exercise by the General Government of
any power it possesses under the Constitution, the mode or manner of exercising its
police power is wholly within the discretion of the State so long as the Constitution of the
United States is not contravened, or any right granted or secured thereby is not
infringed, or not exercised in such an arbitrary and oppressive manner as to justify the
interference of the courts to prevent wrong and oppression.

The liberty secured by the Constitution of the United States does not import an absolute
right in each person to be at all times, and in all circumstances, wholly freed from

12 | P a g e
restraint, nor is it an element in such liberty that one person, or a minority of persons
residing in any community and enjoying the benefits of its local government, should
have power to dominate the majority when supported in their action by the authority of
the State.

It is within the police power of a State to enact a compulsory vaccination law, and it is
for the legislature, and not for the courts, to determine

Page 197 U. S. 12

in the first instance whether vaccination is or is not the best mode for the prevention of
smallpox and the protection of the public health.

There being obvious reasons for such exception, the fact that children, under certain
circumstances, are excepted from the operation of the law does not deny the equal
protection of the laws to adults if the statute is applicable equally to all adults in like
condition.

The highest court of Massachusetts not having held that the compulsory vaccination law
of that State establishes the absolute rule that an adult must be vaccinated even if he is
not a fit subject at the time or that vaccination would seriously injure his health or cause
his death, this court holds that, as to an adult residing in the community, and a fit
subject of vaccination, the statute is not invalid as in derogation of any of the rights of
such person under the Fourteenth Amendment.

This case involves the validity, under the Constitution of the United States, of certain
provisions in the statutes of Massachusetts relating to vaccination.

The Revised Laws of that Commonwealth, c. 75, § 137, provide that

"the board of health of a city or town if, in its opinion, it is necessary for the public health
or safety shall require and enforce the vaccination and revaccination of all the
inhabitants thereof and shall provide them with the means of free vaccination. Whoever,
being over twenty-one years of age and not under guardianship, refuses or neglects to
comply with such requirement shall forfeit five dollars."

An exception is made in favor of "children who present a certificate, signed by a

registered physician that they are unfit subjects for vaccination." § 139.

Proceeding under the above statutes, the Board of Health of the city of Cambridge,
Massachusetts, on the twenty-seventh day of February, 1902, adopted the following
regulation:

"Whereas, smallpox has been prevalent to some extent in the city of Cambridge and still
continues to increase; and whereas it is necessary for the speedy extermination of the
disease that all persons not protected by vaccination should be vaccinated, and

13 | P a g e
whereas, in the opinion of the board, the public health and safety require the vaccination
or revaccination of all the inhabitants of Cambridge; be it ordered, that

Page 197 U. S. 13

all the inhabitants of the city who have not been successfully vaccinated since March 1,
1897, be vaccinated or revaccinated."

Subsequently, the Board adopted an additional regulation empowering a named

physician to enforce the vaccination of persons as directed by the Board at its special
meeting of February 27.

The above regulations being in force, the plaintiff in error, Jacobson, was proceeded
against by a criminal complaint in one of the inferior courts of Massachusetts. The
complaint charged that, on the seventeenth day of July, 1902, the Board of Health of
Cambridge, being of the opinion that it was necessary for the public health and safety,
required the vaccination and revaccination of all the inhabitants thereof who had not
been successfully vaccinated since the first day of March, 1897, and provided them with
the means of free vaccination, and that the defendant, being over twenty-one years of
age and not under guardianship, refused and neglected to comply with such
requirement.

The defendant, having been arraigned, pleaded not guilty. The government put in
evidence the above regulations adopted by the Board of Health, and made proof
tending to show that its chairman informed the defendant that, by refusing to be
vaccinated, he would incur the penalty provided by the statute, and would be
prosecuted therefor; that he offered to vaccinate the defendant without expense to him,
and that the offer was declined, and defendant refused to be vaccinated.

The prosecution having introduced no other evidence, the defendant made numerous
offers of proof. But the trial court ruled that each and all of the facts offered to be proved
by the defendant were immaterial, and excluded all proof of them.

The defendant, standing upon his offers of proof and introducing no evidence, asked
numerous instructions to the jury, among which were the following:

That section 137 of chapter 75 of the Revised Laws of Massachusetts was in derogation
of the rights secured to the defendant by the Preamble to the Constitution of the United

Page 197 U. S. 14

States, and tended to subvert and defeat the purposes of the Constitution as declared in
its Preamble;

That the section referred to was in derogation of the rights secured to the defendant by
the Fourteenth Amendment of the Constitution of the United States, and especially of

14 | P a g e
the clauses of that amendment providing that no State shall make or enforce any law
abridging the privileges or immunities of citizens of the United States, nor deprive any
person of life, liberty or property without due process of law, nor deny to any person
within its jurisdiction the equal protection of the laws; and

That said section was opposed to the spirit of the Constitution.

Each of the defendant's prayers for instructions was rejected, and he duly excepted.
The defendant requested the court, but the court refused, to instruct the jury to return a
verdict of not guilty. And the court instructed the jury, in substance, that, if they believed
the evidence introduced by the Commonwealth and were satisfied beyond a reasonable
doubt that the defendant was guilty of the offense charged in the complaint, they would
be warranted in finding a verdict of guilty. A verdict of guilty was thereupon returned.

The case was then continued for the opinion of the Supreme Judicial Court of
Massachusetts. That court overruled all the defendant's exceptions, sustained the
action of the trial court, and thereafter, pursuant to the verdict of the jury, he was
sentenced by the court to pay a fine of five dollars. And the court ordered that he stand
committed until the fine was paid.

Page 197 U. S. 22

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TEST OF POLICE POWER

YNOT vs IAC Case Digest

RESTITUTO YNOT, petitioner, vs. INTERMEDIATE APPELLATE COURT, THE STATION
COMMANDER, INTEGRATED NATIONAL POLICE, BAROTAC NUEVO, ILOILO and THE REGIONAL
DIRECTOR, BUREAU OF ANIMAL INDUSTRY, REGION IV, ILOILO CITY, respondents.

FACTS: The petitioner had transported six carabaos in a pump boat from Masbate to
Iloilo on January 13, 1984, when they were confiscated by the police station commander
of Barotac Nuevo, Iloilo, for violation of Executive Order No. 626-A which provides that
“the carabao or carabeef transported in violation of this Executive Order as amended shall
be subject to confiscation and forfeiture by the government, to be distributed to charitable
institutions and other similar institutions as the Chairman of the National Meat Inspection
Commission may ay see fit, in the case of carabeef, and to deserving farmers through
dispersal as the Director of Animal Industry may see fit, in the case of carabaos”.

The petitioner sued for recovery, and the Regional Trial Court of Iloilo City issued a writ
of replevin upon his filing of a supersedeas bond of P12,000.00. After considering the
merits of the case, the court sustained the confiscation of the carabaos and, since they
could no longer be produced, ordered the confiscation of the bond. The court also
declined to rule on the constitutionality of the executive order, as raise by the petitioner,
for lack of authority and also for its presumed validity.

The petitioner appealed the decision to the Intermediate Appellate Court,* 3 which upheld
the trial court, ** and he has now come before us in this petition for review on certiorari.

ISSUES: Whether or not executive order no. 626-A is unconstitutional due misapplication
of police power, violation of due process, and undue delegation of legislative power?

HELD: The protection of the general welfare is the particular function of the police power
which both restraints and is restrained by due process. The police power is simply defined
as the power inherent in the State to regulate liberty and property for the promotion of the
general welfare. It is this power that is now invoked by the government to justify Executive
Order No. 626-A, amending the basic rule in Executive Order No. 626, prohibiting the
slaughter of carabaos except under certain conditions. To justify the State in thus
interposing its authority in behalf of the public, it must appear, first, that the interests of
the public generally, as distinguished from those of a particular class, require such
interference; and second, that the means are reasonably necessary for the
accomplishment of the purpose, and not unduly oppressive upon individuals.

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In the light of the tests mentioned, we hold with the Toribio Case that there is no doubt
that by banning the slaughter of these animals except where they are at least seven years
old if male and eleven years old if female upon issuance of the necessary permit, the
executive order will be conserving those still fit for farm work or breeding and preventing
their improvident depletion.

But while conceding that the amendatory measure has the same lawful subject as the
original executive order, we cannot say with equal certainty that it complies with the
second requirement, viz., that there be a lawful method. We note that to strengthen the
original measure, Executive Order No. 626-A imposes an absolute ban not on the
slaughter of the carabaos but on their movement, providing that "no carabao regardless
of age, sex, physical condition or purpose (sic) and no carabeef shall be transported from
one province to another." The object of the prohibition escapes us. The reasonable
connection between the means employed and the purpose sought to be achieved by the
questioned measure is missing.

We do not see how the prohibition of the inter-provincial transport of carabaos can prevent
their indiscriminate slaughter, considering that they can be killed anywhere, with no less
difficulty in one province than in another. Obviously, retaining the carabaos in one
province will not prevent their slaughter there, any more than moving them to another
province will make it easier to kill them there. As for the carabeef, the prohibition is made
to apply to it as otherwise, so says executive order, it could be easily circumvented by
simply killing the animal. Perhaps so. However, if the movement of the live animals for
the purpose of preventing their slaughter cannot be prohibited, it should follow that there
is no reason either to prohibit their transfer as, not to be flippant dead meat.

Even if a reasonable relation between the means and the end were to be assumed, we
would still have to reckon with the sanction that the measure applies for violation of the
prohibition. The penalty is outright confiscation of the carabao or carabeef being
transported, to be meted out by the executive authorities, usually the police only. In the
Toribio Case, the statute was sustained because the penalty prescribed was fine and
imprisonment, to be imposed by the court after trial and conviction of the accused. Under
the challenged measure, significantly, no such trial is prescribed, and the property being
transported is immediately impounded by the police and declared, by the measure itself,
as forfeited to the government. This measure deprives the individual due process as
granted by the Constitution.

The due process clause was kept intentionally vague so it would remain also conveniently
resilient. This was felt necessary because due process is not, like some provisions of the
fundamental law, an "iron rule" laying down an implacable and immutable command for
all seasons and all persons. Flexibility must be the best virtue of the guaranty. The very
elasticity of the due process clause was meant to make it adapt easily to every situation,
enlarging or constricting its protection as the changing times and circumstances may
require.

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Aware of this, the courts have also hesitated to adopt their own specific description of due
process lest they confine themselves in a legal straitjacket that will deprive them of the
elbow room they may need to vary the meaning of the clause whenever indicated.

The minimum requirements of due process are notice and hearing which, generally
speaking, may not be dispensed with because they are intended as a safeguard against
official arbitrariness. It is a gratifying commentary on our judicial system that the
jurisprudence of this country is rich with applications of this guaranty as proof of our fealty
to the rule of law and the ancient rudiments of fair play.

It has already been remarked that there are occasions when notice and hearing may be
validly dispensed with notwithstanding the usual requirement for these minimum
guarantees of due process. It is also conceded that summary action may be validly taken
in administrative proceedings as procedural due process is not necessarily judicial only.
In the exceptional cases accepted, however. there is a justification for the omission of the
right to a previous hearing, to wit, the immediacy of the problem sought to be corrected
and the urgency of the need to correct it.

In the case before us, there was no such pressure of time or action calling for the
petitioner's peremptory treatment. The properties involved were not even inimical per se
as to require their instant destruction. There certainly was no reason why the offense
prohibited by the executive order should not have been proved first in a court of justice,
with the accused being accorded all the rights safeguarded to him under the Constitution.
Considering that, as we held in Pesigan v. Angeles, 21 Executive Order No. 626-A is
penal in nature, the violation thereof should have been pronounced not by the police only
but by a court of justice, which alone would have had the authority to impose the
prescribed penalty, and only after trial and conviction of the accused.

To sum up then, we find that the challenged measure is an invalid exercise of the police
power because the method employed to conserve the carabaos is not reasonably
necessary to the purpose of the law and, worse, is unduly oppressive. Due process is
violated because the owner of the property confiscated is denied the right to be heard in
his defense and is immediately condemned and punished. The conferment on the
administrative authorities of the power to adjudge the guilt of the supposed offender is a
clear encroachment on judicial functions and militates against the doctrine of separation
of powers. There is, finally, also an invalid delegation of legislative powers to the officers
mentioned therein who are granted unlimited discretion in the distribution of the properties
arbitrarily taken. For these reasons, we hereby declare Executive Order No. 626-A
unconstitutional.

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DECS vs San Diego and Dizon-Capulong Case Digest
DEPARTMENT OF EDUCATION, CULTURE AND SPORTS (DECS) and DIRECTOR OF CENTER FOR
EDUCATIONAL MEASUREMENT, petitioners, vs.ROBERTO REY C. SAN DIEGO and JUDGE
TERESITA DIZON-CAPULONG, in her capacity as Presiding Judge of the Regional Trial Court of
Valenzuela, Metro Manila, Branch 172, respondents.

G.R. No. 89572 December 21, 1989

FACTS: The issue before us is mediocrity. The question is whether a person who has
thrice failed the National Medical Admission Test (NMAT) is entitled to take it again.

The petitioner contends he may not, under its rule that-

h) A student shall be allowed only three (3) chances to take the NMAT. After three (3)
successive failures, a student shall not be allowed to take the NMAT for the fourth time.

The private respondent insists he can, on constitutional grounds.

The private respondent is a graduate of the University of the East with a degree of
Bachelor of Science in Zoology. The petitioner claims that he took the NMAT three times
and flunked it as many times. 1 When he applied to take it again, the petitioner rejected
his application on the basis of the aforesaid rule. He then went to the Regional Trial Court
of Valenzuela, Metro Manila, to compel his admission to the test.

In his original petition for mandamus, he first invoked his constitutional rights to academic
freedom and quality education. In an amended petition filed with leave of court, he
squarely challenged the constitutionality of MECS Order No. 12, Series of 1972,
containing the above-cited rule. The additional grounds raised were due process and
equal protection.

ISSUE: Whether or not MECS Order No. 12, Series of 1972 is unconstitutional and
violative of the constitution rights to academic freedom and quality education, due process
and equal protection?

HELD: In reversing the decision of the RTC Judge and affirming the constitutionality of
the MECS Order No. 12, the court cited that the power is validly exercised if (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

19 | P a g e
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.

The subject of the challenged regulation is certainly within the ambit of the police power.
It is the right and indeed the responsibility of the State to insure that the medical
profession is not infiltrated by incompetents to whom patients may unwarily entrust their
lives and health.

The method employed by the challenged regulation is not irrelevant to the purpose of the
law nor is it arbitrary or oppressive. The three-flunk rule is intended to insulate the medical
schools and ultimately the medical profession from the intrusion of those not qualified to
be doctors.

The State has the responsibility to harness its human resources and to see to it that they
are not dissipated or, no less worse, not used at all. These resources must be applied in
a manner that will best promote the common good while also giving the individual a sense
of satisfaction.

The right to quality education invoked by the private respondent is not absolute. The
Constitution also provides that "every citizen has the right to choose a profession or
course of study, subject to fair, reasonable and equitable admission and academic
requirements.”

The private respondent must yield to the challenged rule and give way to those better
prepared.

The contention that the challenged rule violates the equal protection clause is not well-
taken. There would be unequal protection if some applicants who have passed the tests
are admitted and others who have also qualified are denied entrance. In other words,
what the equal protection requires is equality among equals.
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20 | P a g e
LUCENA GRAND CENTRAL TERMINAL v. JAC LINER Case
Digest

LUCENA GRAND CENTRAL TERMINAL, INC. v. JAC LINER, INC.

452 SCRA 174 (2005), EN BANC (Carpio Morales, J.)

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.

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

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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 individual thus requires a more careful formulation of
solutions to societal problems.

From the memorandum filed before the Court by Lucena, it is gathered that the
Sangguniang Panlungsod had identified the cause of traffic congestion to be the
indiscriminate loading and unloading of passengers by buses on the streets of the city
proper, hence, the conclusion that the terminals contributed to the proliferation of buses
obstructing traffic on the city streets.

Bus terminals per se do not, however, impede or help impede the flow of traffic. How the
outright proscription against the existence of all terminals, apart from that franchised to
Lucena, can be considered as reasonably necessary to solve the traffic problem, the
Court has not been enlightened. If terminals lack adequate space such that bus drivers
are compelled to load and unload passengers on the streets instead of inside the
terminals, then reasonable specifications for the size of terminals could be instituted, with
permits to operate the same denied those which are unable to meet the specifications.

In the subject ordinances, however, the scope of the proscription against the maintenance
of terminals is so broad that even entities which might be able to provide facilities better
than the franchised terminal are barred from operating at all.

The Court is not unaware of the resolutions of various barangays in Lucena City
supporting the establishment of a common terminal, and similar expressions of support
from the private sector, copies of which were submitted to this Court by Lucena Grand
Central Terminal, Inc. The weight of popular opinion, however, must be balanced with
that of an individual‘s rights.

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CITY OF MANILA VS. LAGUIO, JR., digested
GR # 118127, April 12, 2005 (Constitutional Law – Police Power, Regulation by Ordinance)

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.

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MA. LOURDES C. FERNANDO v. ST. SCHOLASTICA'S COLLEGE, GR No.
161107, 2013-03-12
[G.R. No. 161107. March 12, 2013.]

Facts:

Respondent SSC is the owner of four (4) parcels of land measuring a total of 56,306.80 square
meters, located in Marikina Heights and covered by Transfer Certificate Title (TCT) No. 91537.
Located within the property are SSA-Marikina, the residence of the sisters of the

Benedictine Order, the formation house of the novices, and the retirement house for the
elderly sisters. The property is enclosed by a tall concrete perimeter fence built some thirty (30)
years ago. Abutting the fence along the West Drive are buildings, facilities, and other...
improvements.[3]

The petitioners are the officials of the City Government of Marikina. On September 30, 1994,
the Sangguniang Panlungsod of Marikina City enacted Ordinance No. 192,[4] entitled
"Regulating the Construction of Fences and Walls in the Municipality of

Marikina." In 1995 and 1998, Ordinance Nos. 217[5] and 200[6] were enacted to amend
Sections 7 and 5, respectively. Ordinance No. 192, as amended, is reproduced hereunder, as
follows:

Section 3. The standard height of fences or walls allowed under this ordinance are as follows:

(1)

Fences on the front yard shall be no more than one (1) meter in height. Fences in excess of one
(1) meter shall be of an open fence type, at least eighty percent (80%) see-thru

Section 5. In no case shall walls and fences be built within the five (5) meter parking area
allowance located between the front monument line and the building line of commercial and
industrial establishments and educational and religious institutions.[7]

Issues:

The ultimate question before the Court is whether Sections 3.1 and 5 of Ordinance No. 192 are
valid exercises of police power by the City Government of Marikina.

24 | P a g e
Ruling:

The test of a valid ordinance... 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 Court joins the CA in finding that the real intent of the setback requirement was to make
the parking space free for use by the public, considering that it would no longer be for the
exclusive use of the respondents as it would also be available for use by the general... public.
Section 9 of Article III of the 1987 Constitution, a provision on eminent domain, provides that
private property shall not be taken for public use without just compensation.

Section 5 to be unreasonable and oppressive as it will substantially divest the respondents of

the beneficial use of their property solely for aesthetic purposes. Accordingly, Section 5 of
Ordinance No. 192 is... invalid.

The principal purpose of Section 3.1 is "to discourage, suppress or prevent the concealment of
prohibited or unlawful acts." The ultimate goal of this objective is clearly the prevention of
crime to ensure public safety and security. The means employed by the petitioners,... however,
is not reasonably necessary for the accomplishment of this purpose and is unduly oppressive to
private rights.

The petitioners have not adequately shown, and it does not appear obvious to this Court, that
an 80% see-thru fence would provide better protection and a higher level of security, or serve
as a more satisfactory criminal deterrent, than a tall solid concrete wall. It may even be...
argued that such exposed premises could entice and tempt would-be criminals to the property,
and that a see-thru fence would be easier to bypass and breach. It also appears that the
respondents' concrete wall has served as more than sufficient protection over the last 40 years.

As to the beautification purpose of the assailed ordinance, as previously discussed, the State
may not, under the guise of police power, infringe on private rights solely for the sake of the
aesthetic appearance of the community. Similarly, the Court cannot perceive how a... see-thru
fence will foster "neighborliness" between members of a community.

Compelling the respondents to construct their fence in accordance with the assailed ordinance
is, thus, a clear encroachment on their right to property, which necessarily includes their right
to decide how best to protect their property.

25 | P a g e
It also appears that requiring the exposure of their property via a see- thru fence is violative of
their right to privacy, considering that the residence of the Benedictine nuns is also located
within the property. The right to privacy has long been considered a fundamental... right
guaranteed by the Constitution that must be protected from intrusion or constraint. The right
to privacy is essentially the right to be let alone,[37] as governmental powers should stop short
of certain intrusions into the personal life of its... citizens

Considering the invalidity of Sections 3.1 and 5, it is clear that the petitioners were acting in
excess of their jurisdiction in enforcing Ordinance No. 1 92 against the respondents. The CA was
correct in affirming the decision of the RTC in issuing the writ of prohibition. The... petitioners
must permanently desist from enforcing Sections 3.1 and 5 of the assailed ordinance on the
respondents' property in Marikina City.

Principles:

The test of a valid ordinance... 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.

Social Justice Society (SJS) v. Atienza, Jr.:[28]

As with the State, local governments may be considered as having properly exercised their
police power only if the following requisites are met: (1) the interests of the public generally, as
distinguished from those of a particular class, require its exercise and (2)... the means employed
are reasonably necessary for the accomplishment of the purpose and not unduly oppressive
upon individuals. In short, there must be a concurrence of a lawful subject and lawful method.

Lacking a concurrence of these two requisites, the police power measure shall be struck down
as an arbitrary intrusion into private rights and a violation of the due process clause

26 | P a g e
PLANTERS PRODUCTS v. FERTIPHIL CORPORATION, GR No. 166006, 2008-
03-14
Facts:

President Ferdinand Marcos, exercising his legislative powers, issued LOI No. 1465 which
provided, among others, for the imposition of a capital recovery component (CRC) on the
domestic sale of all grades of fertilizers in the Philippines.

Pursuant to the LOI, Fertiphil paid P10 for every bag of fertilizer it sold in the domestic market

After the 1986 Edsa Revolution, FPA voluntarily stopped the imposition of the P10 levy. With
the return of democracy, Fertiphil demanded from PPI a refund of the amounts it paid under
LOI No. 1465, but PPI refused to accede to the demand

PPI insists that LOI No. 1465 is a valid exercise either of the police power or the power of
taxation. It claims that the LOI was implemented for the purpose of assuring the fertilizer
supply and distribution in the country and for benefiting a foundation created by law to hold...
in trust for millions of farmers their stock ownership in PPI.

Fertiphil counters that the LOI is unconstitutional because it was enacted to give benefit to a
private company. The levy was imposed to pay the corporate debt of PPI. Fertiphil also argues
that, even if the LOI is enacted under the police power, it is still unconstitutional... because it
did not promote the general welfare of the people or public interest.

Issues:

LOI 1465, BEING A LAW IMPLEMENTED FOR THE PURPOSE OF ASSURING THE FERTILIZER
SUPPLY AND DISTRIBUTION IN THE COUNTRY, AND FOR BENEFITING A FOUNDATION CREATED
BY LAW TO HOLD IN TRUST FOR MILLIONS OF FARMERS THEIR STOCK OWNERSHIP IN PPI
CONSTITUTES A VALID LEGISLATION

PURSUANT TO THE EXERCISE OF TAXATION AND POLICE POWER FOR PUBLIC PURPOSES.

Ruling:

The P10 levy under LOI No. 1465 is... an exercise of the power of taxation.

We agree with the RTC that the imposition of the levy was an exercise by the State of its
taxation power.

27 | P a g e
the primary purpose of the levy is revenue generation. If... the purpose is primarily revenue, or
if revenue is, at least, one of the real and substantial purposes, then the exaction is properly
called a tax.

The P10 levy under LOI No. 1465 is too excessive to serve a mere regulatory purpose.

Taxes are exacted only for a public... purpose. The P10 levy is... unconstitutional because it was
not... for a public purpose. The levy was... imposed to give undue benefit to PPI.

First, the LOI expressly provided that the levy be imposed to benefit PPI, a private company.

Second, the LOI provides that the imposition of the P10 levy was conditional and dependent
upon PPI becoming financially "viable." This suggests that the levy was actually imposed to
benefit PPI.

Third, the RTC and the CA held that the levies paid under the LOI were directly remitted and
deposited by FPA to Far East Bank and Trust Company, the depositary bank of PPI.[49] This
proves that PPI benefited from the LOI. It is also proves that the... main purpose of the law was
to give undue benefit and advantage to PPI.

Fourth, the levy was used to pay the corporate debts of PPI.

All told, the RTC and the CA did not err in holding that the levy imposed under LOI No. 1465 was
not for a public purpose. LOI No. 1465 failed to comply with the public purpose requirement for
tax laws

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COMPARISON WITh OTHER INHERENT POWER

Commonwealth v. Alger, 61 Mass. (7 Cush) 53,[1] was decided by the Supreme Judicial Court of
Massachusetts in 1851. The majority opinion was written by Justice Lemuel Shaw.

Brief

Parties

The defendant, Alger, was a Boston resident who owned property along the Boston harbor. The
Plaintiff is the Commonwealth of Massachusetts.

Relevant statutes

There are two statutes involved in this case.

Colony Ordinance of 1647 which stated that owners of waterfront property also owned the
adjoining land above the low water mark and within 100 rods of the land, with power to erect
wharves and other buildings thereon; subject to the reasonable use of other individuals and of
the public's ability to navigate. Construction was also subject to the restraints and limitations as
the legislature may see fit to impose for the preservation and protection of public and private
rights. 61 Mass. 53 (1851).[1]

Massachusetts legislature enacted a subsequent statute pursuant to the Colony Ordinance of

1647 which established lines in the Boston harbor limiting how far out wharves may extend.
The statutes stated that if a wharf extended beyond an established line, then it will be
considered a public nuisance. In establishing these lines, the legislature overruled the Colony
Ordinance of 1647 which allowed owners of Harbor-front land to build a wharf extending 100
rods into the harbor.

Story

In this case, Alger (Defendant) built a wharf in the Boston Harbor that extended beyond a line
established by the Massachusetts legislature. Alger's wharf was otherwise within the
geographical limits of the colony ordinance of 1647 and it did not impede or obstruct the
public's navigation.

Issue

The issue in Commonwealth v. Alger is "What are the just powers of the legislature to limit,
control, or regulate the exercises and enjoyment of a property owner's rights." 61 Mass. 53, 65
(1851).[1] In short, when, if ever can a regulation be a taking? The Massachusetts Supreme
Court held the Massachusetts Legislature's statutes creating the lines was constitutional law,

29 | P a g e
and the legislature had the authority to make that statute. The statute establishing the line was
binding on Alger and he violated the line. Id. at 102.[1]

Sources of regulatory power

Justice Shaw held it is settled principle that, "every holder of property...holds it under the
implied liability that his use of it may be so regulated, that it shall not be injurious to the equal
enjoyment of others having an equal right to the enjoyment of their property, not injurious to
the rights of the community." Id. at 84.[1]

Police power today is, "generally, but vaguely understood in American jurisprudence to refer to
state regulatory power," but really encompasses more. 58 U. Miami L. Rev. 471, 473(2004).[2]
In an attempt to define police power, Shaw stated, "the government's power to enact such
regulations for the good and welfare of the community as it sees fit, subject to the limitations
that the regulation be both reasonable and constitutional." Id. at 479-80.[2] Shaw goes on to
explain that, "It is much easier to perceive and realize the existence and sources of this power,
then to mark its boundaries, or prescribe limits to its exercise." 61 Mass 53, 85(1851).[1]

Eminent domain vs. police power

Most notably, the court also attempts to differentiate between eminent domain and police
power. In what is often referred to as the most important paragraph of the opinion, the court
explains that police power, "is very different from the right of eminent domain, the right of a
government to take and appropriate private property to public use, whenever the public
exigency requires it; which can be done only on condition of providing a reasonable
compensation therefore. The power we allude to is rather the police power, the power vested
in the legislature by the constitution, to make, ordain, and establish all manner of wholesome
and reasonable laws, statutes and ordinance, either with penalties or without, not repugnant to
the constitution, as they shall judge to be for the good and welfare of the commonwealth, and
of the subjects of the same." Id.[1]

It is often hard to distinguish between police power and eminent domain, Professor Benjamin
Barros states, "Shaw's attempt to make a principled distinction between eminent domain and
the police power was understandable. In the 19th century, it was widely accepted that just
compensation was required only for physical takings, and regulatory restraints on property
were generally considered to be outside of the scope of the Takings clause. Categorizing the law
that prohibited Alger from building his wharf as a regulation allowed Shaw to deny Alger's claim
for compensation. By using the new term 'police power,' Shaw tried to explain this rule in terms
of two distinct government powers, each serving a different purpose." 58 U. Miami L. Rev. 471,
480-81(2004).[2] Shaw provides obvious uses of police power, such as prohibiting the use of
warehouses for the storage of gunpowder when the warehouses are located near homes or
highways, placing restraints on the height of wooden buildings in crowded areas and requiring
them to be covered with incombustible material, and prohibiting buildings from being used as
hospitals for contagious diseases or carrying on of noxious or offensive trades. 61 Mass. 53, 85-
86(1851).[1]

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Justice Shaw reasoned the Massachusetts statute was, "not an appropriation of the property to
a public use, but the restraint of an injurious private use by the owner, and is therefore not
within the principle of property taken under the right of eminent domain." Id. at 86.[1] Shaw
also thought the court's holding in this case would promote certainty, "Things done may or may
not be wrong in themselves, or necessarily injurious and punishable as such at common law;
but laws are passed declaring them offenses, and making them punishable, because they tend
to injurious consequences; but more especially for the sake of having a definite, known and
authoritative rule which all can understand and obey." 58 U. Miami L. Rev. 471, 481 (2004).[2]
Shaw gave an example of the certainty outcome he expected to obtain with this holding: "The
trademan needs to know, before incurring expenses, how near he may build his works without
violating the law or committing a nuisance; builders of houses to know, to what distance they
must keep from the obnoxious works already erected, in order to be sure of the protection of
the law for their habitations. This requisite certainty and precision can only be obtained by a
positive enactment...enforcing the rule thus fixed, by penalties." 61 Mass. 53, 96-97 (1851).[1]
Applying this reasoning to the facts in Alger, Professor Barros concluded that, "the law
challenged in Alger thus legitimately established a point beyond which wharves could not be
built, and Alger's wharf was subject to such regulation even though it was not intrinsically
harmful." 58 U. Miami L. Rev. 471, 482 (2004).[2]

Compensation

Justice Shaw states that even though these prohibitions and restraints resulting from the
Massachusetts statute may diminish the profits of the owner, the owners are not entitled to
compensation because they are exercises of police power. (61 Mass. 53, 86).[1] Justice Shaw's
statement regarding compensation was generally accepted doctrine at the time, namely that
the obligation to compensate was limited to exercises of eminent domain. 58 U. Miami L. Rev
471, 480(2004).[2] However, passage of time "would show this rule to be flawed." Id. at 481.[2]

Impact

Commonwealth v. Alger helped signify a shift from community-based common-law regulation

toward the modern regulatory state. Id. at 471 (2004).[2] The case helped define what we now
think of as the broad scope of policing regulations. The decision in Commonwealth v. Alger also
breaks "with a laissez-faire tradition and ushers in an era of positivist regulation." Id. at 482.[2]
Finally, the court's decision in Commonwealth v. Alger demonstrated an expanded
interpretation of the new term "police power" with Shaw holding, "that state authority to enact
police regulations includes, but is not limited to, such doctrines as" use your own as not to
injure another's property, "and that the legislature has broad authority to exercise this power."
Id

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ROMEO P. GEROCHI v. DEPARTMENT OF ENERGY, GR NO. 159796, 2007-07-
17
Facts:

EPIRA

Universal Charge... respondent Panay Electric Company, Inc. (PECO) charged petitioner Romeo
P. Gerochi and all other... end-users with the Universal Charge as reflected in their respective
electric bills starting from the month of July 2003.[17]

The power to tax is strictly a... legislative function and as such, the delegation of said power to
any executive or administrative agency like the ERC is unconstitutional, giving the same
unlimited authority

The assailed provision clearly provides that the Universal Charge is to be determined, fixed
and... approved by the ERC, hence leaving to the latter complete discretionary legislative
authority.

Universal Charge has the characteristics of a tax and is collected to fund the operations of the
NPC.

unlike a tax which is imposed to provide income for public purposes, such as support of the
government, administration of the law, or payment of public expenses, the... assailed Universal
Charge is levied for a specific regulatory purpose, which is to ensure the viability of the
country's electric power industry.

Respondents Department of Energy (DOE), ERC, and NPC, through the Office of the Solicitor
General (OSG), share the same view that the Universal Charge is not a tax because it is levied
for a specific regulatory purpose, which is to ensure the viability of the country's electric...
power industry, and is, therefore, an exaction in the exercise of the State's police power

Within six (6) months from the effectivity of this Act, promulgate and enforce, in accordance
with law, a National Grid Code and a Distribution Code which shall include, but not limited to
the followin

Issues:

Universal Charge imposed under Sec. 34 of the EPIRA is a tax... undue delegation of legislative
power to tax... power of taxation from the police power.

Ruling:

In exacting the assailed Universal Charge through Sec. 34 of the EPIRA, the State's police power,
particularly its regulatory dimension, is invoked.

it can be gleaned that the assailed Universal Charge is not a tax, but an exaction in the exercise
of the State's police power. Public welfare is surely promoted.

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The Court finds that the EPIRA, read and appreciated in its entirety, in relation to Sec. 34
thereof, is complete in all its essential terms and conditions, and that it contains sufficient
standards.

the law is complete and passes the first test for valid delegation of legislative power.

we therefore hold that there is no undue delegation of legislative power to the ERC.

every law has in its favor the presumption of constitutionality, and to justify its nullification,
there must be a clear and unequivocal breach of the Constitution and not one that is doubtful,
speculative, or argumentative

Principles:

The power to tax is an incident of sovereignty and is unlimited in its range, acknowledging in its
very nature no limits, so that security against its abuse is to be found only in the responsibility
of the legislature which imposes the tax on the constituency that is to pay... it.

police power is the power of the state to promote public welfare by restraining and regulating
the use of liberty and property.

, police power grants a wide panoply of instruments through which the State, as parens patriae,
gives effect to a host of its regulatory powers.[

The conservative and pivotal distinction between these two powers rests in the purpose for
which the charge is made

If generation of revenue is the primary purpose and regulation is merely incidental, the
imposition is a tax... but if regulation is the primary purpose, the fact... that revenue is
incidentally raised does not make the imposition a tax.[36]... it is a well-established doctrine
that the taxing power may be used as an implement of police power

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MANILA MEMORIAL PARK v. SECRETARY OF DEPARTMENT OF
SOCIAL WELFARE, GR No. 175356, 2013-12-03
Facts:
Petitioners assail the constitutionality of Section 4 of Republic Act (RA) No. 7432,[3] as
amended by RA 9257,[4] and the implementing rules and regulations issued by the DSWD
and DOF insofar as these allow business establishments to... claim the 20% discount given
to senior citizens as a tax deduction.
tax credit as the 20 percent discount deductible from gross income for income tax
purposes,... Petitioners emphasize that they 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: "[p]rivate property shall not be taken for public use without
just compensation."... petitioners cite
Central Luzon Drug Corporation,[12] where it was ruled that the 20% discount privilege
constitutes taking of private property for public use which requires the payment of just
compensation
Issues:
WHETHER SECTION 4 OF REPUBLIC ACT NO. 9257 AND X X X ITS IMPLEMENTING
RULES AND REGULATIONS, INSOFAR AS THEY PROVIDE THAT THE TWENTY
PERCENT (20%) DISCOUNT TO SENIOR CITIZENS MAY BE CLAIMED AS A TAX
DEDUCTION BY THE PRIVATE ESTABLISHMENTS, ARE INVALID AND
UNCONSTITUTIONAL.
Ruling:
The Petition lacks merit.
The validity of the 20% senior citizen discount and tax deduction scheme under RA 9257,
as an exercise of police power of the State, has already been settled in Carlos Superdrug
Corporation.
The permanent reduction in their total revenues is a forced subsidy corresponding to the
taking of private property for public use or benefit. This constitutes compensable taking for
which petitioners would ordinarily become entitled to a just compensation.
A tax deduction does not offer full reimbursement of the senior citizen discount. As such, it
would not meet the definition of just compensation.
Having said that, this raises the question of whether 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 Court believes so.

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As a form of reimbursement, the... law provides that business establishments extending the
twenty percent discount to senior citizens may claim the discount as a tax deduction.
The law is a legitimate exercise of police power which, similar to the power of eminent
domain, has general welfare for its object.
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.
Given these, it is incorrect for petitioners to insist that the grant of the senior citizen discount
is unduly oppressive to their business, because petitioners have not taken time to calculate
correctly and come up with a financial report, so that they have not been able to... show
properly whether or not the tax deduction scheme really works greatly to their disadvantage.
We, thus, found that the 20% discount as well as the tax deduction scheme is a valid
exercise of the police power of the State.
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.
the 20% discount is a regulation affecting the ability of private establishments to price their
products and services relative to a special class of individuals, senior citizens, for which the
Constitution affords preferential concern... it does... not purport to appropriate or burden
specific properties, used in the operation or conduct of the business of private
establishments, for the use or benefit of the public, or senior citizens for that matter
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.[77] These laws generally regulate public... utilities or
industries/enterprises imbued with public interest in order to protect consumers from
exorbitant or unreasonable pricing as well as temper corporate greed by controlling the rate
of return on investment of these corporations... considering that they have a monopoly...
over the goods or services that they provide to the general public.
On its face, therefore, the subject regulation is a police power measure.
The obiter in Central Luzon Drug Corporation,[78] however, describes the 20% discount as
an exercise of the power of eminent domain and the tax credit, under the previous law,
equivalent to the amount of discount given as the just compensation... therefor.
It presupposes that the subject regulation, which impacts the pricing and, hence, the
profitability of a private establishment, automatically amounts to a deprivation of property
without due process of law.
If this were so,... then all price and rate of return on investment control laws would have to
be invalidated because they impact, at some level, the regulated establishment's profits or
income/gross sales, yet there is no provision for payment of just compensation

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The obiter is, thus, at odds with the settled doctrine... that the State can employ police
power measures to regulate the pricing of goods and services, and, hence, the profitability
of business establishments in order to pursue legitimate State objectives for the common
good, provided that the regulation does not go too far as to... amount to "taking."
Principles:
Police power versus eminent domain.
Police power is the inherent power of the State to regulate or to restrain the use of liberty
and property for public welfare.[58] The only limitation is that the restriction imposed should
be reasonable, not oppressive.
"property rights of individuals may be subjected to restraints and burdens in... order to fulfill
the objectives of the government.
The State "may interfere with personal liberty, property, lawful businesses and occupations
to promote the general welfare [as long as] the interference [is] reasonable and not
arbitrary.
Eminent domain, on the other hand, is the inherent power of the State to take or appropriate
private property for public use.
private property shall not be taken without due process of law and the... payment of just
compensation
In the exercise of police power, a property right is impaired by regulation,[65] or the use of
property is merely prohibited, regulated or restricted[66] to promote public welfare.
payment of just compensation is not required.
in the exercise of the power of eminent domain, property interests are appropriated and
applied to some public purpose which necessitates the payment of just compensation
therefor.
Normally, the title to and possession of the property are transferred to the... expropriating
authority.

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