Who can exercise? (MMDA vs. Garin, GR No.

130239, April 15, 2005)

FACTS:

Respondent Garin was issued a traffic violation receipt (TVR) and his driver‘s li-
cense was confiscated for parking illegally. Garin wrote to then MMDA Chairman Prospero
Oreta requesting the return of his license and expressed his preference for his case to be
file in Court. Without an immediate reply from the chairman, Garin filed for a preliminary
injunction assailing among others that Sec 5 (f) of RA 7924 violates the constitutional pro-
hibition against undue delegation of legislative authority, allowing MMDA to fix and impose
unspecified and unlimited fines and penalties. RTC rule in his favor, directing MMDA to re-
turn his license and for the authority to desist from confiscating driver‘s license without
first giving the driver the opportunity to be heard in an appropriate proceeding. Thus this
petition.

ISSUE:

WON Sec 5(f) of RA 7924 which authorizes MMDA to confiscate and suspend or re-
voke driver‘s license in the enforcement of traffic rules and regulations constitutional?

HELD:

The MMDA is not vested with police power. It was concluded that MMDA is not a lo-
cal government unit or a public corporation endowed with legislative power and it has no
power to enact ordinances for the welfare of the community.

Police power, as an inherent attribute of sovereignty is the power vested in the leg-
islature to make, ordain, 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 good and welfare of the commonwealth and for subjects of the same.
There is no provision in RA 7924 that empowers MMDA or its council to ―enact or-
dinance, approve resolutions and appropriate funds for the general welfare of the inhabi-
tants of Metro Manila It is an agency created for the purpose of laying down policies and co-
ordinating with the various national government agencies, People‘s Organizations, NGOs
and private sector for the efficient and expeditious delivery of services. All its functions are
administrative in nature.

Hierarchy of Rights
 - Social Justice Society, et al vs Atienza, (GR No. 156052. February 13, 2008)

FACTS:

Ordinance No. 8027 enacted by the Sangguniang Panglungsod of Manila reclassified

the area from industrial to commercial and directed the owners and operators of busi-
nesses disallowed to cease and desist from operating their businesses within six months
from the date of effectivity of the ordinance. Among the businesses situated in the area are
the so-called “Pandacan Terminals” of the oil companies Caltex (Philippines), Inc., Petron
Corporation and Pilipinas Shell Petroleum Corporation.

However, the City of Manila and the Department of Energy (DOE) entered into a
memorandum of understanding (MOU) with the oil companies in which they agreed that
“the scaling down of the Pandacan Terminals [was] the most viable and practicable option.”
In the MOU, the oil companies were required to remove 28 tanks starting with the LPG
spheres and to commence work for the creation of safety buffer and green zones surround-
ing the Pandacan Terminals. In exchange, the City Mayor and the DOE will enable the oil
companies to continuously operate within the limited area resulting from joint operations
and the scale down program. The Sangguniang Panlungosod ratified the MOU in Resolution
No. 97.

Petitioners pray for a mandamus to be issued against Mayor Atienza to enforce Or-
dinance No. 8027 and order the immediate removal of the terminals of the oil companies.

ISSUE:

Whether or not Ordinance No. 8027 is constitutional and valid

HELD:

Mandamus has always been regarded as an extraordinary legal remedy

granted by courts of appellate jurisdiction directed to some corporation, officer, or
inferior court, requiring the performance of a particular duty therein specified,
which duty results from the official station of the party to whom the writ is directed
or from operation of some law.

Yes. The Court ruled in favor of the petitioners. In the present case, Ordinance No.
8027 was enacted for the purpose of promoting sound urban planning, ensuring health,
public safety and general welfare of the residents of Manila. The Sanggunian was impelled
to take measures to protect its residents from catastrophic devastation in case of a terrorist
attack on the Pandacan depots.

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. The depot is perceived, rightly or
wrongly, as a representation of western interests which means that it is a terrorist target.
As long as it there is such a target in their midst, the residents of Manila are not safe. It
therefore became necessary to remove these terminals to dissipate the threat. Wide discre-
tion is vested on the legislative authority to determine not only what the interests of the
public require but also what measures are necessary for the protection of such interests.
Clearly, the Sanggunian was in the best position to determine the needs of its constituents.

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 meth-
ods or means used to protect public health, morals, safety or welfare must have a reason-
able relation to the end in view.

Essentially, the oil companies are fighting for their right to property. They al-
lege 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.

The mayor has the mandatory legal duty to enforce Ordinance No. 8027 because the
Local Government Code imposes upon respondent the duty, as city mayor, to “enforce all
laws and ordinances relative to the governance of the city.” One of these is Ordinance No.
8027. As the chief executive of the city, he has the duty to enforce Ordinance No. 8027 as
long as it has not been repealed by the Sanggunian or annulled by the courts. He has no
other choice. It is his ministerial duty to do so.

Further, the zoning ordinance which reclassified the area is reasonable and
not arbitrary enactment to the oil companies because they were not prevented nor
prohibited from doing business in the city other than the now reclassified location of
the depot where such operations are no longer permitted. The power to establish
zones for industrial, commercial and residential uses is derived from the police
power itself and is exercised for the protection and benefit of the residents.

Averring that they shall not be compensated, the Court ruled that property con-
demned under the exercise of police power is not compensable. The restriction imposed to
protect lives, public health and safety from danger is not a form of taking like exercise of
eminent domain.

The tests of a valid ordinance are well established. For an ordinance to be valid, it
must not only be within the corporate powers of the LGU to enact and be passed according
to the procedure prescribed by law, it must also conform to the following substantive re-
quirements:
 (1) must not contravene the Constitution or any statute;

The question now is whether Ordinance No. 8027 contravenes RA 7638 (DOE Act of
1992) 145 and RA 8479 (Downstream Oil Industry Deregulation Law of 1998). It does not.

Under Section 5 (c) of RA 7638, DOE was given the general power to "establish and
administer programs for the exploration, transportation, marketing, distribution, utiliza-
tion, conservation, stockpiling, and storage of energy resources". On the other hand, under
Section 7 of RA 8749, the DOE "shall continue to encourage certain practices in the Industry
which serve the public interest and are intended to achieve efficiency and cost reduction,
ensure continuous supply of petroleum products."

Nothing in these statutes prohibits the City of Manila from enacting ordinances in
the exercise of its police power.

(2) must not be unfair or oppressive;

The oil companies are not forbidden to do business in the City of Manila. They may
still very well do so, except that their oil storage facilities are no longer allowed in the Pan-
dacan area. Certainly, there are other places in the City of Manila where they can conduct
this specific kind of business. Ordinance No. 8027 did not render the oil companies illegal.
The assailed ordinance affects the oil companies business only in so far as the Pandacan
area is concerned.

(3) must not be partial or discriminatory;

An ordinance based on reasonable classification does not violate the constitutional

guaranty of the equal protection of the law. The requirements for a valid and reasonable
classification are: (1) it must rest on substantial distinctions; (2) it must be germane to the
purpose of the law; (3) it must not be limited to existing conditions only and (4) it must ap-
ply equally to all members of the same class.

The law may treat and regulate one class differently from another class provided
there are real and substantial differences to distinguish one class from another.

(4) must not prohibit but may regulate trade;

(5) must be general and consistent with public policy, and
(6) must not be unreasonable.

-Diocese of Bacolod vs COMELEC GR NO. 205 728, January 21, 2015

 FACTS:

Bishop Vicente M. Navarra posted two (2) tarpaulins, each with approximately six
feet (6′) by ten feet (10′) in size, for public viewing within the vicinity of San Sebastian
Cathedral of Bacolod. One of the tarpaulins stated: “Conscience Vote” and lists of candidates
as either “(Anti-RH) Team Buhay” with a check mark or “(Pro-RH) Team Patay” with an “X”
mark. The electoral candidates were classified according to their vote on the adoption of
the RH Law. 

Those who voted for the passing of the law were classified as comprising “Team
Patay,” while those who voted against it form “Team Buhay. 

When the said tarpaulin came to the attention of Comelec, it sent a letter to Bishop
Navarra ordering the immediate removal of the tarpaulin because it was in violation of
Comelec Resolution No. 9615 as the lawful size for election propaganda material is only
two feet (2’) by three feet (3’); otherwise, it will be constrained to file an election offense
against the latter. 

Concerned about the imminent threat of prosecution for their exercise of free
speech, Bishop Navarra, et al. prayed for the Court to declare the questioned orders of Com-
elec as unconstitutional, and permanently restraining the latter from enforcing them after
notice and hearing. 

ISSUE:

1. Whether or not the controversial tarpaulin is an election propaganda which the

Comelec has the power to regulate;
2. Whether or not the assailed notice and letter for the removal of the tarpaulin vi-
olated petitioners’ fundamental right to freedom of expression.
3. Whether or not there was violation of petitioners’ right to property.

HELD:

1. No. It is not election propaganda.

Respondents cite the Constitution, laws, and jurisprudence to support their position
that they had the power to regulate the tarpaulin. However, the Court held that all of these
provisions pertain to candidates and political parties. Petitioners are not candidates. Nei-
ther do they belong to any political party. COMELEC does not have the authority to regulate
the enjoyment of the preferred right to freedom of expression exercised by a non-candidate
in this case.

2. Yes. The Court held that every citizen’s expression with political consequences
enjoys a high degree of protection. While the tarpaulin may influence the success or failure
of the named candidates and political parties, this does not necessarily mean it is election
propaganda. The tarpaulin was not paid for or posted “in return for consideration” by any
candidate, political party, or party-list group. 

3. Yes. The Court held that even though the tarpaulin is readily seen by the public,
the tarpaulin remains the private property of petitioners. Their right to use their property
is likewise protected by the Constitution.

                Any regulation, therefore, which operates as an effective confiscation of pri-

vate property or constitutes an arbitrary or unreasonable infringement of property rights
is void, because it is repugnant to the constitutional guaranties of due process and equal
protection of the laws.

                The Court in Adiong case held that a restriction that regulates where decals
and stickers should be posted is “so broad that it encompasses even the citizen’s private
property.” Consequently, it violates Article III, Section 1 of the Constitution which provides
that no person shall be deprived of his property without due process of law.

-PBM Employees Org. vs PBN Co. 51 SCRA 189

FACTS:

The petitioner Philippine Blooming Mills Employees Organization (PBMEO) is a le-

gitimate labor union composed of the employees of the respondent Philippine Blooming
Mills Co., Inc., with the officers and members of the petitioner.

Petitioners claim that on March 1, 1969, they decided to stage a mass demonstration
at Malacañ ang on March 4, 1969, in protest against alleged abuses of the Pasig police, to be
participated in by the workers in the first shift (from 6 A.M. to 2 P.M.) as well as those in the
regular second and third shifts (from 7 A.M. to 4 P.M. and from 8 A.M. to 5 P.M., respec-
tively); and that they informed the respondent Company of their proposed demonstration.

The parties stipulated that the company, after learning the mass demonstration, in-
formed the union panel that they even if the demonstration is an inalienable right granted
by the Constitution, it should not unduly prejudice the normal operation of the company. 
As such, they warned the PBMEO representatives that workers who belong to the first and
regular shifts, who without previous leave of absence approved by the Company, particu-
larly , the officers present who are the organizers of the demonstration, who shall fail to re-
port for work the following morning (March 4, 1969) shall be dismissed, because such fail-
ure is a violation of the existing CBA (collective bargaining agreement which fixes the
working shifts of the employees) particularly Article XXIV: NO LOCKOUT — NO STRIKE’;
and, therefore, would be amounting to an illegal strike.

Because the petitioners and their members proceeded with the demonstration de-
spite the pleas of the respondent Company that the first shift workers should not be re-
quired to participate in the demonstration and that the workers in the second and third
shifts should be utilized for the demonstration, respondent Company charged the petition-
ers with a “violation of Section 4(a)-6 in relation to Sections 13 and 14, as well as Section
15, all of Republic Act No. 875, and of the CBA providing for ‘No Strike and No Lockout.’ ”

In their answer, petitioners claim that they did not violate the existing CBA because
they gave the respondent Company prior notice of the mass demonstration on March 4,
1969; that the said mass demonstration was a valid exercise of their constitutional freedom
of speech against the alleged abuses of some Pasig policemen; and that their mass demon-
stration was not a declaration of strike because it was not directed against the respondent
firm.

After considering the aforementioned stipulation of facts submitted by the parties,

Judge Joaquin M. Salvador, in an order dated September 15, 1969, found herein petitioner
PBMEO guilty of bargaining in bad faith and herein petitioners, as directly responsible for
perpetrating the said unfair labor practice were considered to have lost their status as em-
ployees of the respondent Company.

ISSUE:

Whether or not the workers who joined the strike violated the CBA? 

HELD:

No. While the Bill of Rights also protects property rights, the primacy of human
rights over property rights is recognized. Because these freedoms are "delicate and vulner-
able, as well as supremely precious in our society" and the "threat of sanctions may deter
their exercise almost as potently as the actual application of sanctions," they "need breath-
ing space to survive," permitting government regulation only "with narrow specificity."
Property and property rights can be lost thru prescription; but human rights are impre-
scriptible.

In the hierarchy of civil liberties, the rights to freedom of expression and of assem-
bly occupy a preferred position as they are essential to the preservation and vitality of our
civil and political institutions; and such priority "gives these liberties the sanctity and the
sanction not permitting dubious intrusions." The freedoms of speech and of the press as
well as of peaceful assembly and of petition for redress of grievances are absolute when di-
rected against public officials or "when exercised in relation to our right to choose the men
and women by whom we shall be governed.”   

Tests of Police Power

 Laws:
- Balacuit v. CFI, G.R. No. L-38429, June 30, 1988

FACTS:

Ordinance No. 640 was passed by the Municipal Board of the City of Butuan on April
21, 1969 which penalizes ―any person group of persons, entity or corporation engaged
in the business of selling admission tickets to any movie or other public exhibitions,
games, contests or other performances to require children between seven (7) and twelve
(12) years of age to pay full payment for tickets intended for adults (should charge
only one-half of the said ticket.)

The petitioners Carlos Balacuit, Lamberto Tan, and Sergio Yu Carcel are man-
agers of the Maya and Dalisay Theaters, the Crown Theater, and the Diamond
Theater, respectively. Aggrieved by the effect of the said ordinance, they filed a com-
plaint before the Court of First Instance of Agusan del Norte and Butuan City on June
30, 1969 praying that the subject ordinance be declared unconstitutional and, there-
fore, void and unenforceable.

Respondent City of Butuan, on the other hand, now invokes the police power as del-
egated to it under the general welfare clause to justify the enactment of said ordinance.
Subsequently, the respondent court rendered its decision declaring Ordinance No.
640 as constitutional and valid. Petitioners filed a motion for reconsideration of the de-
cision of the respondent court but was later on denied.

ISSUE:

WON Ordinance No. 640 is a valid exercise of police power

HELD:

No. Ordinance No. 640 infringes theater owners’ right to property.

While it is true that a business may be regulated, it is equally true that such regula-
tion must be within the bounds of reason, that is, the regulatory ordinance must be reason-
able, and its provisions cannot be oppressive amounting to an arbitrary interference with
the business or calling subject of regulation.

A lawful business or calling may not, under the guise of regulation, be unreasonably
interfered with even by the exercise of police power. A police measure for the regulation of
the conduct, control and operation of a business should not encroach upon the legitimate
and lawful exercise by the citizens of their property rights. The right of the owner to fix a
price at which his property shall be sold or used is an inherent attribute of the property it-
self and, as such, within the protection of the due process clause. Hence, the proprietors of
a theater have a right to manage their property in their own way, to fix what prices of ad-
mission they think most for their own advantage, and that any person who did not approve
could stay away.

Ordinance No. 640 clearly invades the personal and property rights of petitioners
for even if we could assume that, on its face, the interference was reasonable, from the fore-
going considerations, it has been fully shown that it is an unwarranted and unlawful cur-
tailment of the property and personal rights of citizens. For being unreasonable and an un-
due restraint of trade, it cannot, under the guise of exercising police power, be upheld as
valid.

The evident purpose of the ordinance is to help ease the burden of cost on the part
of parents who have to shell out the same amount of money for the admission of their chil-
dren, as they would for themselves. A reduction in the price of admission would mean cor-
responding savings for the parents; however, the petitioners are the ones made to bear the
cost of these savings. The ordinance does not only make the petitioners suffer the loss of
earnings but it likewise penalizes them for failure to comply with it. There is nothing im-
moral or injurious in charging the same price for both children and adults. In fact, no per-
son is under compulsion to purchase a ticket. It is a totally voluntary act on the part of the
purchaser if he buys a ticket to such performances.

The exercise of police power by the local government is valid unless it contra-
venes the fundamental law of the land, or an act of the legislature, or unless it is against
public policy or is unreasonable, oppressive, partial, discriminating or in derogation of a
common right.

- Lozano vs. Matinez, 146 SCRA 323 (1986)

FACTS:

A motion to quash the charge against the petitioners for violation of the BP 22 was
made, contending that no offense was committed, as the statute is unconstitutional.

The constitutionality of Batas Pambansa Bilang 22 (BP 22 for short), popularly

known as the Bouncing Check Law, which was approved on April 3, 1979, is the sole issue
presented by these petitions for decision.

BP 22 punishes a person "who makes or draws and issues any check on account or
for value, knowing at the time of issue that he does not have sufficient funds in or credit
with the drawee bank for the payment of said check in full upon presentment, which check
is subsequently dishonored by the drawee bank for insufficiency of funds or credit or
would have been dishonored for the same reason had not the drawer, without any valid
reason, ordered the bank to stop payment."

Those who question the constitutionality of BP 22 insist that: (1) it offends the con-
stitutional provision forbidding imprisonment for debt; (2) it impairs freedom of contract;
(3) it contravenes the equal protection clause; (4) it unduly delegates legislative and execu-
tive powers; and (5) its enactment is flawed in that during its passage the Interim Batasan
violated the constitutional provision prohibiting amendments to a bill on Third Reading.

Among the constitutional objections raised against BP 22, the most serious is the al-
leged conflict between the statute and the constitutional provision forbidding imprison-
ment for debt. It is contended that the statute runs counter to the inhibition in the Bill of
Rights which states, "No person shall be imprisoned for debt or non-payment of a poll tax."
Petitioners insist that, since the offense under BP 22 is consummated only upon the dis-
honor or non-payment of the check when it is presented to the drawee bank, the statute is
really a "bad debt law" rather than a "bad check law." What it punishes is the non-payment
of the check, not the act of issuing it. The statute, it is claimed, is nothing more than a veiled
device to coerce payment of a debt under the threat of penal sanction.

Such motion was denied by the RTC. The petitioners thus elevate the case to
the Supreme Court for relief. The Solicitor General, commented that it was premature for
the accused to elevate to the Supreme Court the orders denying their motions to
quash. However, the Supreme Court finds it justifiable to intervene for the review of lower
court's denial of a motion to quash.

ISSUE:

WON BP 22 is constitutional as it is a proper exercise of police power of the State

HELD:

Yes. The enactment of BP 22 a valid exercise of the police power and is not repug-
nant to the constitutional inhibition against imprisonment for debt. Police power is a dy-
namic force that enables the state to meet the exigencies of changing times. There are occa-
sions when the police power of the state may even override a constitutional guaranty. For
example, there have been cases wherein we held that the constitutional provision on non-
impairment of contracts must yield to the police power of the state.

The offense punished by BP 22 is the act of making and issuing a worthless check or
a check that is dishonored upon its presentation for payment. It is not the non-payment of
an obligation which the law punishes. The law is not intended or designed to coerce a
debtor to pay his debt. The thrust of the law is to prohibit, under pain of penal sanctions,
the making of worthless checks and putting them in circulation. Because of its deleterious
effects on the public interest, the practice is proscribed by the law. The law punishes the act
not as an offense against property, but an offense against public order.

The effect of the issuance of a worthless checks transcends the private interests of
the parties directly involved in the transaction and touches the interests of the community
at large. The mischief it creates is not only a wrong to the payee or holder, but also an in-
jury to the public. The magnitude of the amount involved amply justifies the legitimate con-
cern of the state in preserving the integrity of the banking system. Flooding the system
with worthless checks is like pouring garbage into the bloodstream of the nation's
economy.

In sum, we find the enactment of B.P. 22 a valid exercise of the police power and is
not repugnant to the constitutional inhibition against imprisonment for debt.

- Carlos Superdrug Corporation vs. DSWD, et al.,

GR No. 166494, (June 29, 2007)

FACTS:

Petitioners are domestic corporations and proprietors operating drugstores 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.

President Gloria Macapagal-Arroyo signed into law R.A. No. 9257 otherwise known
as the “Expanded Senior Citizens Act of 2003.”

Sec. 4(a) of the Act states that The senior citizens shall be entitled to the following:
(a) the grant of twenty percent (20%) discount from all establishments relative to the uti-
lization 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;

The establishment may claim the discounts granted under (a), (f), (g) and (h) as tax
deduction based on the net cost of the goods sold or services rendered. Petitioners assert
that Section 4(a) of the law is unconstitutional because it constitutes deprivation   of pri-
vate property. Compelling drugstore owners and establishments to grant the discount will
result in a loss of profit and capital because according to them drugstores impose a mark-
up of only 5% to 10% on branded medicines, and the law failed to provide a scheme
whereby drugstores will be justly compensated for the discount.

Petitioners assail the constitutionality of Section 4 (a) of the Expanded Senior Citi-
zens Act based on the following grounds:
• The law is confiscatory because it infringes Art. III, Sec. 9 of the Constitution which
provides that private property shall not be taken for public use without just compensa-
tion;
• It violates the equal protection clause (Art. III, Sec. 1) enshrined in our Constitu-
tion which states that "no person shall be deprived of life, liberty or property without due
process of law, nor shall any person be denied of the equal protection of the laws;" and
 • The 20% discount on medicines violates the constitutional guarantee in Article
XIII, Section 11 that makes "essential goods, health and other social services available to
all people at affordable cost."

ISSUE:

WON RA 9257 is constitutional. Whether the State, in promoting the health and wel-
fare of a special group of citizens, can impose upon private establishments the burden of
partly subsidizing a government program.

HELD:

YES. 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 im-
provement and well-being as the State considers them an integral part of our society.

The law is a legitimate exercise of police power which, similar to the power of emi-
nent domain, has general welfare for its object. Police power is not capable of an exact defi-
nition, but has been purposely veiled in general terms to underscore its comprehensive-
ness to meet all exigencies and provide enough room for an efficient and flexible response
to conditions and circumstances, thus assuring the greatest benefits. Accordingly, it has
been described as the most essential, insistent and the least limitable of powers, extending
as it does to all the great public needs. It is [t]he power vested in the legislature by the con-
stitution to make, ordain, and establish all manner of wholesome and reasonable laws,
statutes, and ordinances, either with penalties or without, not repugnant to the constitu-
tion, as they shall judge to be for the good and welfare of the commonwealth, and of the
subjects of the same.

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 consid-
erably 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 nullifica-
tion in view of the presumption of validity which every law has in its favor.

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 disad-
vantage.

In treating the discount as a tax deduction, petitioners insist that they will incur
losses. However, petitioner’s computation is clearly flawed. For purposes of reimburse-
ment, the law states that the cost of the discount shall be deducted from gross income, the
amount of income derived from all sources before deducting allowable expenses, which
will result in net income. Absent any financial statement, petitioners cannot substantiate
their claim that they will be operating at a loss should they give the discount. In addition,
the computation was erroneously based on the assumption that their customers consisted
wholly of senior citizens. Lastly, the 32% tax rate is to be imposed on income, not on the
amount of the discount.

While the Constitution protects property rights, petitioners must accept the realities
of business and the State, in the exercise of police power, can intervene in the operations of
a business which may result in an impairment of property rights in the process.

Zoning and Regulatory Ordinances:

- Ermita-Malate Hotel & Motel Operators v. City

Mayor Mayor, 20 SCRA 849 (1967)
FACTS:

On 5 July 1963, the Ermita-Malate Hotel and Motel Operators Association (EMH-
MOA), its member Hotel del Mar, and a certain Go Chiu filed a petition for prohibition
against the mayor of the City of Manila in his capacity as he is charged with the general
power and duty to enforce ordinances of the City of Manila and to give the necessary orders
for the faithful execution and enforcement of such ordinances. There was a plea for the is-
suance of preliminary injunction and for a final judgment declaring the Ordinance No. 4760
null and void and unenforceable.

This ordinance was passed on June 13, 1963 by the Municipal Board of Manila
passed with the following provisions questioned for its violation of due process:

1. refraining from entertaining or accepting any guest or customer unless it fills

out a prescribed form (open to public view at all times and in his presence, wherein the
surname, given name and middle name, the date of birth, the address, the occupation, the
sex, the nationality, the length of stay and the number of companions in the room, if any,
with the name, relationship, age and sex would be specified, with data furnished as to his
residence certificate as well as his passport number, if any, coupled with a certification
that a person signing such form has personally filled it up and affixed his signature in the
presence of such owner, manager, keeper or duly authorized representative, with such
registration forms and records kept and bound together) in the lobby in open view;

2. provides that the premises and facilities of such hotels, motels and lodging
houses would be open for inspection either by the City Mayor, or the Chief of Police, or
their duly authorized representatives. The ordinance also classified motels into two
classes and required the maintenance of certain minimum facilities in first class motels
such as a telephone in each room, a dining room or restaurant and laundry; while sec-
 ond class motels are required to have a dining room. prohibiting admission of less than
18 years old;

3. usurious increase of license fee to P4,500 and 6,000 o 150% and 200% respec-
tively (tax issue also);

4. making unlawful lease or rent more than twice every 24 hours; and

5. automatic cancellation of license for subsequent violation.

The lower court issued preliminary injunction and petitioners raised the case to SC
on certiorari.

ISSUE:

Whether Ordinance No. 4760 of the City of Manila is violative of the due process
clause?

HELD:

No. The ordinance was enacted to minimize certain practices hurtful to public
morals. It was made as there is observed an alarming increase in the rate of prostitution,
adultery and fornication in Manila traceable in great part to the existence of motels, which
provide a necessary atmosphere for clandestine entry, presence and exit and thus become
the ideal haven for prostitutes and thrill seekers. The ordinance proposes to check the clan-
destine harboring of transients and guests of these establishments by requiring these tran-
sients and guests to fill up a registration form, prepared for the purpose, in a lobby open to
public view at all times, and by introducing several other amendatory provisions calculated
to shatter the privacy that characterizes the registration of transients and guests.

The increase in the license fees was intended to discourage establishments of the
kind from operating for purpose other than legal and to increase the income of the city gov-
ernment. Further, the restriction on the freedom to contract, insofar as the challenged ordi-
nance makes it unlawful for the owner, manager, keeper or duly authorized representative
of any hotel, motel, lodging house, tavern, common inn or the like, to lease or rent any room
or portion thereof more than twice every 24 hours, with a proviso that in all cases full pay-
ment shall be charged, cannot be viewed as a transgression against the command of due
process.

It is neither unreasonable nor arbitrary. Precisely it was intended to curb the oppor-
tunity for the immoral or illegitimate use to which such premises could be, and, are being
devoted. Furthermore, the right of the individual is necessarily subject to reasonable re-
straint by general law for the common good. The liberty of the citizen may be restrained in
the interest of the public health, or of the public order and safety, or otherwise within the
proper scope of the police power. State in order to promote the general welfare may inter-
fere with personal liberty, with property, and with business and occupations. Persons and
property may be subjected to all kinds of restraints and burdens, in order to secure the
general comfort, health, and prosperity of the state. 

- Social Justice Society vs Atienza (GR No. 156502, 13 February 2008

FACTS:

Ordinance No. 8027 enacted by the Sangguniang Panglungsod of Manila reclassified

the area from industrial to commercial and directed the owners and operators of busi-
nesses disallowed to cease and desist from operating their businesses within six months
from the date of effectivity of the ordinance. Among the businesses situated in the area are
the so-called “Pandacan Terminals” of the oil companies Caltex (Philippines), Inc., Petron
Corporation and Pilipinas Shell Petroleum Corporation.

However, the City of Manila and the Department of Energy (DOE) entered into a
memorandum of understanding (MOU) with the oil companies in which they agreed that
“the scaling down of the Pandacan Terminals [was] the most viable and practicable option.”
In the MOU, the oil companies were required to remove 28 tanks starting with the LPG
spheres and to commence work for the creation of safety buffer and green zones surround-
ing the Pandacan Terminals. In exchange, the City Mayor and the DOE will enable the oil
companies to continuously operate within the limited area resulting from joint operations
and the scale down program. The Sangguniang Panlungosod ratified the MOU in Resolution
No. 97.

Petitioners pray for a mandamus to be issued against Mayor Atienza to enforce Or-
dinance No. 8027 and order the immediate removal of the terminals of the oil companies.

ISSUE:

Whether or not Ordinance No. 8027 is constitutional and valid

HELD:

Yes. The Court ruled in favor of the petitioners. In the present case, Ordinance No.
8027 was enacted for the purpose of promoting sound urban planning, ensuring health,
public safety and general welfare of the residents of Manila. The Sanggunian was impelled
to take measures to protect its residents from catastrophic devastation in case of a terrorist
attack on the Pandacan depots.

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. The depot is perceived, rightly or
wrongly, as a representation of western interests which means that it is a terrorist target.
As long as it there is such a target in their midst, the residents of Manila are not safe. It
therefore became necessary to remove these terminals to dissipate the threat. Wide discre-
tion is vested on the legislative authority to determine not only what the interests of the
public require but also what measures are necessary for the protection of such interests.
Clearly, the Sanggunian was in the best position to determine the needs of its constituents.

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 meth-
ods or means used to protect public health, morals, safety or welfare must have a reason-
able relation to the end in view.

The mayor has the mandatory legal duty to enforce Ordinance No. 8027 because the
Local Government Code imposes upon respondent the duty, as city mayor, to “enforce all
laws and ordinances relative to the governance of the city.” One of these is Ordinance No.
8027. As the chief executive of the city, he has the duty to enforce Ordinance No. 8027 as
long as it has not been repealed by the Sanggunian or annulled by the courts. He has no
other choice. It is his ministerial duty to do so.

Further, the zoning ordinance which reclassified the area is reasonable and not arbi-
trary enactment to the oil companies because they were not prevented nor prohibited from
doing business in the city other than the now reclassified location of the depot where such
operations are no longer permitted. The power to establish zones for industrial, commer-
cial and residential uses is derived from the police power itself and is exercised for the pro-
tection and benefit of the residents.

Averring that they shall not be compensated, the Court ruled that property con-
demned under the exercise of police power is not compensable. The restriction imposed to
protect lives, public health and safety from danger is not a form of taking like exercise of
eminent domain.

The tests of a valid ordinance are well established. For an ordinance to be valid, it
must not only be within the corporate powers of the LGU to enact and be passed according
to the procedure prescribed by law, it must also conform to the following substantive re-
quirements:
(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. There is no showing that the Ordinance is unconstitu-
tional.

- Cruz vs. Paras, 123 SCRA 569 (1983)

FACTS:
 The Local Government of Bocaue, Bulacan, a municipal corporation, enacted Ordi-
nance No. 84 which sought to prohibit the operation of night clubs and cabarets includ-
ing the employment of hostesses or hospitality girls in such night clubs.

The Petitioners filed with the Court of First Instance a petition for prohibition with
preliminary injunction alleging that:

• Ordinance No. 84 is null and void as a municipality has no authority to prohibit a

lawful business, occupation, or calling.
• It violated the petitioners’ right to due process and equal protection of the law as
their licenses were previously given and permits were withdrawn without a judicial
hearing, and
• Under Presidential Decree No. 189, as amended, the power to license and regulate
tourist-oriented business including night clubs has been transferred to the Department of
Tourism.

The Municipality answered that:

• That the Municipal Council is authorized by law not only to regulate but to pro-
hibit the establishment, maintenance, and operation of night clubs invoking Section 2243
of the RAC, CA 601, Republic Acts Nos. 938, 978 and 1224
• Ordinance No. 84 is not violative of petitioners’ right to due process and the equal
protection of the law, since property rights are subordinate to public interests.
• That Presidential Decree No. 189, as amended, did not deprive Municipal Councils
of their jurisdiction to regulate or prohibit night clubs

The Court of First Instance dismissed the case and upheld the constitutionality of
Ordinance No. 84.

ISSUE:

Whether or not Ordinance No. 84 as enacted is a valid exercise of police power by

the local government unit.

HELD:

No. Police power is granted to municipal corporations in general terms as fol-

lows: “General power of council to enact ordinances and make regulations. – The municipal
council shall enact such ordinances and make such regulations, not repugnant to law, as
may be necessary to carry into effect and discharge the powers and duties conferred upon
it by law and such as shall seem necessary and proper to provide for the health and safety,
promote the prosperity, improve the morals, peace, good order, comfort, and convenience
of the municipality and the inhabitants thereof, and for the protection of property therein.”
 The general welfare clause has two branches: One branch attaches itself to the main
trunk of municipal authority, and relates to such ordinances and regulations as may be nec-
essary to carry into effect and discharge the powers and duties conferred upon the munici-
pal council by law. With this class we are not here directly concerned. The second branch of
the clause is much more independent of the specific functions of the council which are enu-
merated by law. It authorizes such ordinances as shall seem necessary and proper to pro-
vide for the health and safety, promote the prosperity, improve the morals, peace, good or-
der, comfort, and convenience of the municipality and the inhabitants thereof, and for the
protection of property therein.’

It is a general rule that ordinances passed by virtue of the implied power found in
the general welfare clause must be reasonable, consonant with the general powers and
purposes of the corporation, and not inconsistent with the laws or policy of the State.” If
night clubs were merely then regulated and not prohibited, certainly the assailed ordinance
would pass the test of validity. In the two leading cases above set forth, this Court had
stressed reasonableness, consonant with the general powers and purposes of municipal
corporations, as well as consistency with the laws or policy of the State. It cannot be said
that such a sweeping exercise of a lawmaking power by Bocaue could qualify under the
term reasonable.

It is clear that in the guise of a police regulation, there was in this instance a clear in-
vasion of personal or property rights, personal in the case of those individuals desirous of
patronizing those night clubs and property in terms of the investments made and salaries
to be earned by those therein employed.

In the present case, it is clear that municipal corporations cannot prohibit the opera-
tion of night clubs. They may be regulated, but not prevented from carrying on their busi-
ness.

- Velasco vs. Villegas, 120 SCRA 568 (1983)

FACTS:

Petitioners assailed the validity of Ordinance 4964, prohibiting barbershop to con-

duct massaging customers in a separate room or in any room in the same building where
the operator of the barbershop and the room of massaging is the same. The contention be-
ing that it amounts to a deprivation of property of petitioners-appellants of their means of
livelihood without due process of law.

Lower Court dismissed the petition for declaratory relief.

ISSUE:

Whether or not Ordinance 4964 is unconstitutional?

 HELD:

No. Decision affirmed. Order 4964 is a police power measure in order to forestall
possible immorality which might grow out of the construction of separate rooms for mas-
sage of customers.

The attack against the validity cannot succeed. As pointed out in the brief of respon-
dents-appellees, it is a police power measure. The objectives behind its enactment are: “(1)
To be able to impose payment of the license fee for engaging in the business of massage
clinic under Ordinance No. 3659 as amended by Ordinance 4767, an entirely different mea-
sure than the ordinance regulating the business of barbershops and, (2) in order to fore-
stall possible immorality which might grow out of the construction of separate rooms for
massage of customers.”

The Court has been most liberal in sustaining ordinances based on the general wel-
fare clause. As far back as U.S. v. Salaveria, 4 a 1918 decision, this Court through Justice
Malcolm made clear the significance and scope of such a clause, which “delegates in statu-
tory form the police power to a municipality. As above stated, this clause has been given
wide application by municipal authorities and has in its relation to the particular circum-
stances of the case been liberally construed by the courts. Such, it is well to really is the
progressive view of Philippine jurisprudence.”

- Magtajas vs. Pryce Properties, 234 SCRA 255 (1994)

FACTS:

PAGCOR is a corporation created directly by P.D. 1869 to help centralize and regu-
late all games of chance, including casinos on land and sea within the territorial jurisdiction
of the Philippines.

PAGCOR decided to expand its operations to Cagayan de Oro City. It leased a portion
of a building belonging to Pryce Properties Corporations, Inc., renovated & equipped the
same, and prepared to inaugurate its casino during the Christmas season.

Then Mayor Magtajas together with the city legislators and civil organizations of the
City of Cagayan de Oro denounced such project.

In reaction to this project, the Sangguniang Panlungsod of Cagayan de Oro City en-
acted two (2) ordinances prohibiting the issuance of a business permit and canceling exist-
ing business permit to establishment for the operation of casino (ORDINANCE NO. 3353)
and an ordinance prohibiting the operation of casino and providing penalty for its viola-
tion. (ORDINANCE NO. 3375-93).

Pryce assailed the ordinances before the Court of Appeals, where it was joined by
PAGCOR as intervenor and supplemental petitioner.
 Court of Appeals declared the ordinances invalid and issued the writ prayed for to
prohibit their enforcement. Reconsideration of this decision was denied against petitioners.

Hence, this petition for review under Rule 45

ISSUE:

WON Ordinance No. 3353 and Ordinance No. 3375-93 are a valid exercise of police
power.

HELD:

NO. The ordinances enacted are invalid. Ordinances should not contravene a statute.
Municipal governments are merely agents of the National Government. Local Councils exer-
cise only delegated powers conferred by Congress. The delegate cannot be superior to the
principal powers higher than those of the latter. PD 1869 authorized casino gambling. As a
statute, it cannot be amended/nullified by a mere ordinance.

As to petitioners attack on gambling as harmful and immoral, the Court stressed that
the morality of gambling is not a justiciable issue. Gambling is not illegal per se. While it is
generally considered inimical to the interests of the people, there is nothing in the Constitu-
tion categorically proscribing or penalizing gambling or, for that matter, even mentioning it
at all.

It is left to Congress to deal with the activity as it sees fit. In the exercise of its own
discretion, the legislature may prohibit gambling altogether or allow it without limitation
or it may prohibit some forms of gambling and allow others for whatever reasons it may
consider sufficient. Thus, it has prohibited jueteng and monte but permits lotteries, cock-
fighting, and horse-racing. In making such choices, Congress has consulted its own wisdom,
which this Court has no authority to review, much less reverse. Well has it been said that
courts do not sit to resolve the merits of conflicting theories. That is the prerogative of the
political departments. It is settled that questions regarding the wisdom, morality, or practi-
cability of statutes are not addressed to the judiciary but may be resolved only by the leg-
islative and executive departments, to which the function belongs in our scheme of govern-
ment. That function is exclusive. Whichever way these branches decide, they are answer-
able only to their own conscience and the constituents who will ultimately judge their acts,
and not to the courts of justice.

- City of Manila v. Judge Laguio, G.R. No. 118127, April 12, 2005

FACTS:

The private respondent, Malate Tourist Development Corporation (MTOC) is a cor-

poration engaged in the business of operating hotels, motels, hostels, and lodging houses. It
built and opened Victoria Court in Malate which was licensed as a motel although duly ac-
credited with the Department of Tourism as a hotel.

March 30, 1993 - City Mayor Alfredo S. Lim approved an ordinance enacted which
prohibited certain forms of amusement, entertainment, services and facilities where
women are used as tools in entertainment and which tend to disturb the community, annoy
the inhabitants, and adversely affect the social and moral welfare of the community. The
Ordinance prohibited the establishment of sauna parlors, massage parlors, karaoke bars,
beerhouses, night clubs, day clubs, cabarets, motels, inns. Owners and operators of the enu-
merated establishments are given three months to wind up business operations or transfer
to any place outside Ermita-Malate or convert said businesses to other kinds allowable
within the area. The Ordinance also provided that in case of violation and conviction, the
premises of the erring establishment shall be closed and padlocked permanently.

June 28, 1993 - MTOC filed a Petition with the lower court, praying that the Ordi-
nance, insofar as it included motels and inns as among its prohibited establishments, be de-
clared invalid and unconstitutional for several reasons but mainly because it is not a valid
exercise of police power and it constitutes a denial of equal protection under the law.

Judge Laguio ruled for the petitioners. The case was elevated to the Supreme Court.

ISSUE:

Whether or not Ordinance No. 7783 is constitutional?

HELD:

No. SC held that the ordinance is unconstitutional for several reasons.

First, it did not meet the valid exercise of police power. To successfully invoke the ex-
ercise of police power, not only must it appear that (1)the interest of the public generally,
as distinguished from those of a particular class, require an interference with private
rights, but (2)the means employed must be reasonably necessary for the accomplishment
of the purpose and not unduly oppressive. The object of the ordinance was the promotion
and protection of the social and moral values of the community. The closing down and
transfer of businesses or their conversion into businesses allowed under the ordinance
have no reasonable relation to its purpose. Otherwise stated, the prohibition of the enu-
merated establishments will not per se protect and promote social and moral welfare of the
community. It will not itself eradicate prostitution, adultery, fornication nor will it arrest
the spread of sexual disease in Manila.

Second. The modality employed constitutes unlawful taking. The ordinance is unrea-
sonable and oppressive as it substantially divests the respondent of the beneficial use of its
property. The ordinance forbids running of the enumerated businesses in Ermita-Malate
area and instructs owners/operators to wind up their business operations or to transfer
outside the area or convert said business into allowed business. An ordinance which per-
manently restricts the use of property that it cannot be used for any reasonable purpose
goes beyond regulation and must be recognized as a taking of the property without just
compensation. It is intrusive and violative of the private property rights of individuals.
There are two types of taking: A “possessory” taking and a “regulatory” taking. The latter
occurs when the government’s regulation leaves no reasonable economically viable use of
the property, as in this case.

Third. The ordinance violates the equal protection clause. Equal protection requires
that all persons or things similarly situated should be treated alike, both as to the rights
conferred and responsibilities imposed. Similar subjects, in other words, should not be
treated differently, so as to give undue favor to some. Legislative bodies are allowed to clas-
sify the subjects of legislation provided the classification is reasonable. To be valid, it must
conform to the following requirements: (1)It must be based on substantial distinction; (2)It
must be germane to the purpose of the law; (3)It must not be limited to existing conditions
only; and (4)It must apply equally to all members of the class.

In the Court’s view, there are no substantial distinction between motels, inns, pen-
sion houses, hotels, lodging houses or other similar establishments. By definition, all are
commercial establishments providing lodging and usually meals and other services for the
public. No reason exists for prohibiting motels and inns but not pension houses, hotels,
lodging houses or other similar establishments. The Court likewise cannot see the logic for
prohibiting the business and operation of motels in the Ermita-Malate area but not outside
this area. A noxious establishment does not become any less noxious if located outside the
area.

Fourth. The ordinance is repugnant to general laws, thus it is ultra vires. The ordi-
nance is in contravention of the Revised Administrative Code as the Code merely empow-
ers the local government units to regulate, and not prohibit, the establishments enumer-
ated. Not only that, it likewise runs counter to the provisions of P.D. 499. The P.D. Had al-
ready converted the residential Ermita-Malate area into a commercial area. The decree al-
lowed the establishment and operation of all kinds of commercial establishments.

- Ortigas vs. Feati Bank, 94 SCRA 719

FACTS:

Ortigas and Co. is engaged in real estate business developing and selling lots to the
public.  It sold to Augusto Padilla and Natividad Angeles Lots Nos. 5 and 6, Block 31 of the
Highway Hills Subdivision, Mandaluyong by sale on instalments.  The vendees then trans-
ferred their rights and interests over the aforesaid lots in favour of one Emma Chavez.  The
agreements of sale on instalment and the deeds of sale contained the restriction that “The
parcel of land subject of this deed of sale shall be used by the Buyer exclusively for residen-
tial purposes, and she shall not be entitled to take or remove soil, stones or gravel from it or
any other lots belonging to the Seller.” 

Feati Bank and Trust Co. later bought said lots from Emma Chavez in the name of
Republic Flour Mills.  Ortigas and Co. claims that the restrictions were imposed as part of
its general building scheme designed for the beautification and development of the High-
way Hills Subdivision which forms part of its big landed estate.  Feati Bank, on the other
hand, maintains that the area along the western part of EDSA from Shaw Boulevard to
Pasig River has been declared a commercial and industrial zone, per Resolution No. 27 s-
1960 of the Municipal Council of Mandaluyong, Rizal.  Later on, Feati Bank commenced
construction on the said lots for a building devoted to banking purposes.  It refused to com-
ply with the demands of Ortigas & Co. to stop the said construction.

ISSUE:

Whether a municipal resolution can nullify contractual obligations

HELD:

Yes. While non-impairment of contracts is constitutionally guaranteed, the rule is

not absolute, since it has to be reconciled with the legitimate exercise of police power, i.e. “
the power to prescribe regulations to promote the health, morals, peace, education, good
order or safety of the general welfare of the people.”  This general welfare clause shall be
liberally interpreted in case of doubt, so as to give more power to local governments in pro-
moting the economic conditions, social welfare and material progress of the people in the
community.  The only exceptions under Section 12 of the Local Autonomy Act (R.A. 2264)
are existing vested rights arising out of a contract between a province, city or municipality
on one hand and a third party on the other hand.  Said case is not present in this petition. 

Resolution No. 27 s-1960 declaring the western part of EDSA as an industrial and
commercial zone was passed in the exercise of police power to safeguard or promote the
health, safety, peace, good order and general welfare of the people in the locality. 

- Presley vs. Bel-Air Village Association, 201SCRA 13

FACTS:

A complaint for specific performance was filed by respondent against Teofilo

& Rollo Almendras (both deceased and substituted by petitioner) for violating
a Bel-Air Subdivision restriction that the subject house and lot shall be used only
for residential and not for commercial purposes, and for non-payment of association dues
to BAVA (respondent)
 Deceased petitioners were the registered owners of the property while Presley,
as lessee of the property, is the owner and operator of ―Hot Pan de Sal Store‖ located
in the same address.

The RTC rendered decision in favor of respondent which was affirmed by the
CA

Motion for reconsideration was denied hence this petition.

ISSUE:

Whether or not the deed of restriction can be enforced by BAVA against the peti-
tioner.

HELD:

No. The contractual stipulations on the use of the land even if said conditions are an-
notated on the torrens title can be impaired if necessary, to reconcile with the legitimate
exercise of police power. Like all contracts, subject to the overriding demands, needs, and
interests of the greater number as the State may determine in the legitimate exercise of po-
lice power. The jurisdiction of the court guarantees sanctity of contract and is said to be the
'law between the contracting parties,' (Civil Code, supra, art. 1159) but while it is so, it can-
not contravene 'law, morals, good customs, public order, or public policy.' (supra, art.
1306). Above all, it cannot be raised as a deterrent to police power, designed precisely to
promote health, safety, peace, and enhance the common good, at the expense of contractual
rights, whenever necessary.

Jupiter Street has been highly commercialized since the passage of Ordinance No.
81-01. The records indicate that commercial buildings, offices, restaurants, and stores have
already sprouted in the area. The Court saw no reason why the petitioner should be singled
out and prohibited from putting up her hot pan de sal store.

The respondent court in the case at bar was not at all entirely wrong in up-
holding the Deed of Restrictions annotated in the title of the petitioners. It held that the
provisions of the Deed of Restrictions are in the nature of contractual obligations
freely entered into by the parties. Undoubtedly, they are valid and can be enforced
against the petitioner.

But they are, like all contracts, subject to the overriding demands, needs, and inter-
ests of the greater number as the State may determine in the legitimate exercise of
police power. Our jurisdiction guarantees sanctity of contract and is said to be the
'law between the contracting parties,' (Civil Code, supra, art. 1159) but while it is so,
it cannot contravene 'law, morals, good customs, public order, or public policy.' (supra,
art. 1306). Above all, it cannot be raised as a deterrent to police power, designed pre-
cisely to promote health, safety, peace, and enhance the common good, at the ex-
pense of contractual rights, whenever necessary

Administrative Rules and Regulations

- Knights of Rizal vs Torre de Manila

FACTS:

This case mainly involves the Resolution that was issued by the City Council of
Manila enjoining the Office of the Building Official to temporarily suspend the building per-
mit of DMCI-PDI, citing that the Torre de Manila Condo will rise up high above the back of
the national monument, to clearly dwarf the statue of our hero, Jose Rizal, and would cer-
tainly ruin the line of sight of the Rizal Shrine from the frontal Roxas Boulevard vantage
point.

DMCI Project Developers, Inc. (DMCI-PDI)3 acquired a 7,716.60-square meter lot in

the City of Manila, located near Taft Avenue, Ermita. This lot was earmarked for the con-
struction of DMCI-PDI's Torre de Manila condominium project.

DMCI-PDI already secured its Barangay Clearance to start the construction of its
project, Zoning Permit from the City of Manila's City Planning and Development Office
(CPDO) and the said Building Permit allowing it to build a "Forty-Nine (49) Storey w/Base-
ment & 2 penthouse Level Res'l./Condominium" on the property.

Herein petitioners, KOR, is a "civic, patriotic, cultural, non- partisan, non-sectarian

and non-profit organization" created under Republic Act No. 646, filed a Petition for In-
junction seeking a temporary restraining order, and later a permanent injunction, against
the construction of DMCI-PDI's Torre de Manila condominium project.

KOR claims that the Torre de Manila project violates the NHCP's Guidelines on Mon-
uments Honoring National Heroes, Illustrious Filipinos and Other Personages, which state
that historic monuments should assert a visual "dominance" over its surroundings, as well
as the country’s commitment under theInternational Charter for the Conservation and
Restoration of Monuments and Sites, otherwise known as the Venice Charter. Lastly, the
KOR claims that the DMCI-PDI's construction was commenced and continues in bad faith,
and is in violation of the City of Manila's zoning ordinance

ISSUE:

Whether or not the Court can issue a writ of mandamus against the officials of the
City of Manila to stop the construction of DMCI-PDI’s Torre de Manila project.

HELD:
 No. There is no law prohibiting the construction of the Torre de Manila. The Court
has allowed or upheld actions that were not expressly prohibited by statutes when it deter-
mined that these acts were not contrary to morals, customs, and public order, or that up-
holding the same would lead to a more equitable solution to the controversy. 

The main purpose of zoning is the protection of public safety, health, convenience,
and welfare. There is no allegation or proof that the Torre de Manila project is “contrary to
morals, customs, and public order” or that it brings harm, danger, or hazard to the commu-
nity. There is no law prohibiting the construction of the Torre de Manila due to its effect on
the background “view, vista, sightline, or setting” of the Rizal Monument.

On the contrary, the City of Manila has determined that DMCI-PDI complied with the
standards set under the pertinent laws and local ordinances to construct its Torre de
Manila project. While the Rizal Park has been declared a National Historical Site, the area
where Torre de Manila is being built is a privately-owned property that is "not part of the
Rizal Park that has been declared as a National Heritage Site in 1995," and the Torre de
Manila area is in fact "well-beyond" the Rizal Park, according to NHCP Chairperson Dr.
Maria Serena I. Diokno. 62 Neither has the area of the Torre de Manila been designated as a
"heritage zone, a cultural property, a historical landmark or even a national treasure."

The Rules on Civil Procedure are clear that mandamus only issues when there is a
clear legal duty imposed upon the office or the officer sought to be compelled to perform an
act, and when the party seeking mandamus has a clear legal right to the performance of
such act.

- Taxicab Operators of Metro Manila vs. BOT, 119 SCRA 597 (1982)

FACTS:

Taxicab Operators of Metro Manila, Inc. (TOMMI) is a domestic corporation com-

posed of taxicab operators, who are grantees of Certificates of Public Convenience to oper-
ate taxicabs within the City of Manila and to any other place in Luzon accessible to vehicu-
lar traffic. Ace Transportation Corporation and Felicisimo Cabigao are two of the members
of TOMMI, each being an operator and grantee of such certificate of public convenience.
 TOMMI filed a petition for Certiorari, Prohibition and Mandamus against Board of
Transportation for enacting Memorandum Circular 77-42. This circular phases out old and
dilapidated taxis; refusing registration to taxi units within the National Capitol Region hav-
ing year models over 6 years old. Pursuant to the above BOT circular, Director of the Bu-
reau of Land Transportation (BLT) issued Implementing Circular 52, dated 15 August 1980,
instructing the Regional Director, the MV Registrars and other personnel of BLT, all within
the NCR, to implement said Circular, and formulating a schedule of phase-out of vehicles to
be allowed and accepted for registration as public conveyances. In accordance therewith,
cabs of model 1971 were phase-out in registration year 1978; those of model 1972, in
1979; those of model 1973, in 1980; and those of model 1974, in 1981.

On 27 January 1981, petitioners filed a Petition with the BOT (Case 80-7553), seek-
ing to nullify MC 77-42 or to stop its implementation; to allow the registration and opera-
tion in 1981 and subsequent years of taxicabs of model 1974, as well as those of earlier
models which were phased-out, provided that, at the time of registration, they are road-
worthy and fit for operation. On 16 February 1981, petitioners filed before the BOT a “Man-
ifestation and Urgent Motion”, praying for an early hearing of their petition. The case was
heard on 20 February 1981. On 28 November 1981, petitioners filed before the same Board
a “Manifestation and Urgent Motion to Resolve or Decide Main Petition” praying that the
case be resolved or decided not later than 10 December 1981 to enable them, in case of de-
nial, to avail of whatever remedy they may have under the law for the protection of their in-
terests before their 1975 model cabs are phased-out on 1 January 1982. Petitioners,
through its President, allegedly made personal follow-ups of the case, but was later in-
formed that the records of the case could not be located. On 29 December 1981, the present
Petition was instituted.

ISSUE:

Whether or not Memorandum Circular 77-42 is valid?

HELD:

Yes. Writ denied and Petition dismissed. The overriding consideration is the safety
and comfort of the riding public from the dangers posed by old and dilapidated taxis. BOT
exercised its police power by prescribing regulation to promote public safety. The State, in
the exercise of its police power, can prescribe regulations to promote the health, morals,
peace, good order, safety and general welfare of the people. It can prohibit all things hurtful
to comfort, safety and welfare of society. It may also regulate property rights. The necessi-
ties imposed by public welfare may justify the exercise of governmental authority to regu-
late even if thereby certain groups may plausibly assert that their interests are disregarded.

- PPA v. Cipres Stevedoring, G.R. No. 145742, July 14, 2005

FACTS:
 Cargo handling operations in Dumaguete City were granted to respondent Cipres
Stevedoring since 1976. On 1990, petitioner Philippine Ports Authority issued Administra-
tive Order 03-90 outlining the guidelines and procedures in the selection and award of
cargo handling contracts in all government ports as well as cargo handling services. Re-
spondent was able to continue with its business by virtue of hold-over permit granted by
PPA. While the second hold-over permit was in effect, PPA issued AO 03-2000 expressly
provides that all contract for cargo handling services of more than three years shall be
awarded through public bidding. Cipres filed for TRO contending that substantial number
of workers in the port of Dumaguete City faced the risk of displacement. Moreover, the pos-
sibility existed that the contract for cargo handling in Dumaguete City would be awarded to
an incompetent and inexperienced participant in the bidding process unlike respondent
which had already invested substantial capital in its operations in the port of said city. RTC
decided in favour of Cipres. PPA filed petition for certiorari.

ISSUE:

Whether or not AO 03-2000 is constitutional?

HELD:

Yes. Petition granted. CA decision reversed and set aside. Stevedoring services are
imbued with public interest and subject to the state’s police power. The Manila South Har-
bor is public property owned by the State. The operations of this premiere port of the coun-
try, including stevedoring work, are affected with public interest. Stevedoring services are
subject to regulation and control for the public good and in the interest of general welfare.

PPA is empowered, after consultation with relevant government agencies, to make

port regulations particularly to make rules or regulation for the planning, development,
construction, maintenance, control, supervision and management of any port or port dis-
trict in the country. With this mandate, the decision to bid out the cargo holding services in
the ports around the country is properly within the province and discretion of petitioner
which we cannot simply set aside absent grave abuse of discretion on its part.

- Chavez v. Romulo, G.R. No. 157036. June 9, 2004

FACTS:

GMA delivered a speech to PNP directing PNP Chief Hermogenes Ebdane to suspend
the issuance pf Permit to Carry Firearms Outside of Residence PTCFOR. Ebdane issued
guidelines banning carrying firearms outside of residence. Petitioner, Francisco Chaves re-
quested DILG to reconsider the implementation. The request was denied. Hence the peti-
tion for prohibition and injunction against Executive Secretary Alberto Romulo and PNP
Chief Ebdane.
 ISSUE:

Whether or not revocation of PTCFOR is a violation of right to property? Whether or

not the banning of carrying firearms outside the residence is a valid exercise of police
power?

HELD:

Petition dismissed. Just like ordinary licenses in other regulated fields, PTCFOR may
be revoked any time. It does not confer an absolute right, but only a personal privilege to be
exercised under existing restrictions. A licensee takes his license subject to such conditions
as the Legislature sees fit to impose, and one of the statutory conditions of this license is
that it might be revoked. Revocation of it does not deprive the defendant of any property,
immunity, or privilege.

The basis for its issuance was the need for peace and order in the society. the as-
sailed Guidelines do not entirely prohibit possession of firearms. What they proscribe is
merely the carrying of firearms outside of residence. However, those who wish to carry
their firearms outside of their residences may re-apply for a new PTCFOR. This is a reason-
able regulation. If the carrying of firearms is regulated, necessarily, crime incidents will be
curtailed.