1

CONSTITUTIONAL LAW 2
SY 2022-2023

MODULE 1

Fundamental Powers of the State

Inherent Powers of the State:

a) Police Power
b) Power of Eminent Domain
c) Power of Taxation

Similarities, Distinctions, Limitations

Similarities:
a) inherent in the Senate
b) necessary and indispensable
c) method by which the State intervenes with private property
d) exercised by the legislature

Distinctions:
a) police power regulates both liberty and property; eminent domain
and taxation affect property rights only
b) police and taxation power can be exercised by the government only;
eminent domain may be exercised private entities;
c) property taken in police power is usually noxious and may be
destroyed; eminent domain and taxation the property is
wholesome and devoted to public use or purpose;
d) compensation in police power is intangible, altruistic feeling of
contribution to public good; in eminent domain the full and fair
equivalent of property taken; in taxation it is the protection
given and/or public improvements.
e) police and taxation power are directed against the whole
constituency; eminent domain against a particular property.

Limitations:
The Bill of Rights, subject to exceptions.

A. POLICE POWER

It is the power of promoting public welfare by restraining and

regulating the use and enjoyment of liberty and property;

- the power to prescribe regulations to promote the health,

morals, peace, education, good order or safety, and general welfare
of the people.
 2

Requisites for the valid exercise of police power:

a) the interests of the public generally, as distinguished from those
of a particular class, should justify the interference of the State;
and
b) the means employed are reasonably necessary.

Scope and General Characteristics

The most pervasive, least limiting and most demanding.

Limitations on the valid exercise of police power

1. Lawful subject

The interests of the public in general, as distinguished from those of

a particular class, require the exercise of the power. The activity or property
sought to be regulated affects the general welfare.

2. Lawful Means
The means employed are reasonably necessary for the
accomplishment of the purpose, and not unduly oppressive on individual.

Additional Limitations When Police Power is Delegated

a) express grant by law
b) within territorial limits
c) must not be contrary to law

For municipal ordinances to be valid, they: a) must not contravene

the Constitution or any statute; b) must not be unfair or oppressive; c) must not
be partial or discriminatory; d) must not prohibit, but may regulate trade; e)
must not be unreasonable; and f) must be general in application and consistent
with public policy.

Cases: (1) Ortigas & Co. vs. CA, G.R 126102, December 4, 2000
(2) Lucena Grand Central Terminal vs. Jac Liner, G.R.
148339, February 23, 2005
(3) City of Manila vs. Judge Laguio, G.R. 118127, April 12,
2005
(4) Carlos Superdrug Corporation vs. DSWD, et al., G.R.
166494, June 29, 2007
(5) Social Justice Society vs. Alfredo Lim, G.R. 187836,
November 25, 2014
 3

B. POWER OF EMINENT DOMAIN OR POWER OF

EXPROPRIATION

It is 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.

It is the inherent right of the Sate to condemn private property

to public use upon payment of just compensation.

Distinction between police power and power of eminent domain

1. Property condemned under police power is usually noxious or intended
for a noxious purpose, hence no compensation is paid.
2. In the exercise of police power, property rights of individuals are
subjected to restraints and burdens in order to secure the general
comfort, health and prosperity of the State;
3. Property interest in police power is merely restricted because the
continued use thereof would be injurious to public interest, hence there is
no compensable taking; in eminent domain, property interest is
appropriated and applied to some public purpose, there is need to
pay just compensation.
4. In police power, the State restricts the use of private property but
none of the property interests in the bundle of rights which constitute
ownership is appropriated for use by or for the benefit of the public;

Who may exercise power of eminent domain

Congress and by delegation the President, administrative bodies,
local government units and even private enterprises performing
public services.

Requisites for a valid exercise of power of eminent domain:

(a) Necessity
(b) Private property
(c) Taking in the constitutional sense
(d) Public use
(e) Just compensation

Necessity

There must be a genuine necessity that must be of public

character. The government may not capriciously or arbitrarily choose
which private property should be expropriated.

Private property
 4

Private property already devoted to public use cannot be

expropriated by a delegate of legislature acting under a general grant
of authority [City of Manila vs. Chinese Community, 40 Phil 349]

All private property capable of ownership may be expropriated, except

money and choses in action (property right or right to possession of something
than can be enforced through legal action). Even services may be subject to
eminent domain. [Republic vs. PLDT, GR L-18841, January 27, 1969]

Taking in the constitutional sense

It may include trespass without actual eviction of the owner, material

impairment of the value of the property or prevention of the
ordinary uses for which the property was intended.

Public Use
The general concept of meeting public need or public exigency. It is not
confined to actual use by the public in its traditional sense. The term
public use has now been held to be synonymous with public interest, public
benefit, public welfare and public convenience.

Just Compensation
The full and fair equivalent of the property taken; it is the fair market
value of the property.

For purposes of just compensation, the fair market value of the

expropriated property is determined by its character and its price at the
time of actual taking.

Cases: (6) Manila Memorial Park vs. Secretary, DSWD, G.R.

175356, December 3, 2013
(7) Spouses Cabahug vs. National Power Corporation, G.R.
186069, January 30, 2013
(8) Landbank of the Philippines vs. Escarilla & Co., G.R.
178046, June 13, 2012
(9) Reyes vs. National Housing Authority, G.R. 147511,
January 20, 2003

C. POWER OF TAXATION

Is the power by which the sovereign raises revenues to defray the

necessary expenses of government.
 5

Requisites for a valid exercise of power of taxation:

a) must not violate due process;
b) must be uniform and equitable; and
c) must be for a public purpose.

Who may exercise

Primarily, the legislature; also local legislative bodies and to a
limited extent the President when granted tariff powers.

Limitations on the exercise

a) due process of law-tax should not be confiscatory
b) equal protection clause-taxes should be uniform and equitable
c) public purpose

Double Taxation
Additional taxes are laid on the same subject by the same taxing
jurisdiction during the same taxing period and for the same purpose.

Tax Exemptions
Requisite: No law granting any tax exemption shall be passed without the
concurrence of a majority of all the Members of Congress.

Exempt from Taxation:

1. Charitable institutions, churches and parsonages or convents
appurtenant thereto, mosques, non-profit cemeteries, and all lands,
buildings and improvements, actually directly and exclusively used
for religious, charitable or educational purposes
2. All revenues and assets of non-stock, non-profit educational
institutions used actually, directly and exclusively for educational
purposes shall be exempt from taxes and duties;
3. Subject to conditions prescribed by law, all grants, endowments,
donations or contributions used actually, directly and exclusively for
educational purposes.

Police Power vs. Taxation

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, it does
not make the imposition a tax as it is an exaction that involves police
power.

License fee vs. Tax

1. License fee is a police measure; tax is a revenue measure;
2. Amount collected for a license fee is limited to the cost of permit
and reasonable police regulation; amount of tax may be unlimited
provided it is not confiscatory.
 6

3. License fee is paid for the privilege of doing something and may be
revoked when public interest so requires; tax is imposed on persons
or property for revenue.

Kinds of License Fee

1. for useful occupations or enterprises
2. for non-useful occupations or enterprises-the amount imposed may be a
bit exorbitant

Cases: (10) Gerochi vs. Department of Energy, G.R. 159796,

July 17, 2007
(11) City Government of Quezon City, et al., vs. Bayan
Telecommunications, Inc., G.R. 162015, March 6,
2006
(12) Abakada Guro Party List, et al. vs. Ermita, et al., G.R.
168056, September 1, 2005