G.R. No.

135962 March 27, 2000

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner,
vs.
BEL-AIR VILLAGE ASSOCIATION, INC., respondent.

Facts:
This case involves a dispute between the Metropolitan Manila Development Authority
(MMDA) and the Bel-Air Village Association, Inc. (BAVA) regarding the opening of a
private road in a residential subdivision. The MMDA, a government agency tasked with
delivering basic services in Metro Manila, requested BAVA to open Neptune Street, a
road inside the Bel-Air Village, to public vehicular traffic. BAVA filed a case for
injunction against the MMDA, arguing that the MMDA does not have the authority to
order the opening of a private subdivision road without an ordinance from the City
Council of Makati. The trial court denied the issuance of a preliminary injunction, but
the Court of Appeals ruled in favor of BAVA, stating that the authority to open the road
is vested in the City Council of Makati. The MMDA appealed to the Supreme Court.

Issue:
The main issue in this case is whether the MMDA has the authority to open a private
road in a residential subdivision without an ordinance from the City Council of Makati.

Ruling:
The Supreme Court ruled that the MMDA does not have the power to enact ordinances
for the welfare of the community. It is the local government units, through their
respective legislative councils, that possess legislative power and police power. In this
case, the City Council of Makati did not pass any ordinance ordering the opening of
Neptune Street, making the proposed opening by the MMDA illegal. The Court
emphasized that the MMDA's powers are limited to the delivery of basic services and
that its good intentions cannot justify the opening of a private street without any legal
warrant. The promotion of the general welfare should not be achieved at the expense of
the rule of law.

MMDA does not have the authority to open a private road in a residential subdivision
without an ordinance from the City Council of Makati. The MMDA's powers are limited
to the delivery of basic services, and it does not possess legislative power or police
power. The Court emphasized the importance of adhering to the rule of law and the
limited administrative functions of the MMDA.
 G.R. No. L-7859 December 22, 1955
WALTER LUTZ, as Judicial Administrator of the Intestate Estate of the deceased Antonio
Jayme Ledesma, plaintiff-appellant,
vs.
J. ANTONIO ARANETA, as the Collector of Internal Revenue, defendant-appellee.

Facts:
The case of Lutz v. Araneta involves the constitutionality of taxes imposed by the Sugar
Adjustment Act, specifically Commonwealth Act No. 567. The plaintiff, Walter Lutz, as
the Judicial Administrator of the Intestate Estate of Antonio Jayme Ledesma, filed a case
in the Court of First Instance of Negros Occidental to challenge the legality of the taxes
imposed by the said act. The law was enacted in 1940 due to the threat to the sugar
industry posed by the imminent imposition of export taxes on sugar. The law aimed to
stabilize the sugar industry and readjust the benefits derived from it. It provided for an
increase in the tax on the manufacture of sugar and levied a tax on owners or persons in
control of lands devoted to sugar cane cultivation. The taxes collected were to be placed
in a special fund known as the Sugar Adjustment and Stabilization Fund, which would
be used for various purposes related to the sugar industry.

Issue:
The main issue raised in the case was whether the taxes imposed by the Sugar
Adjustment Act were constitutional. The plaintiff argued that the tax was not for a
public purpose and therefore violated the constitutional limitations on taxation.

Ruling:
The Supreme Court, in its ruling, affirmed the constitutionality of the taxes imposed by
the Sugar Adjustment Act.

Ratio:
The Court held that the protection and promotion of the sugar industry is a matter of
public concern, and therefore, the legislature has the power to determine what is
necessary for its protection and expedient for its promotion. The Court emphasized that
the Act was primarily an exercise of the state's police power rather than a pure exercise
of the taxing power. It stated that if the objective and methods of the law are
constitutionally valid, there is no reason why the state cannot levy taxes to raise funds
for their prosecution and attainment.
The Court also noted that it is inherent in the power to tax that a state be free to select
the subjects of taxation, and inequalities resulting from singling out a particular class for
taxation do not infringe any constitutional limitation. The Court further explained that
even if the Act were considered a pure tax measure, the expenditure of tax money for
experimental stations and the improvement of living and working conditions in the
sugar industry does not constitute expenditure for private purposes.
In summary, the Supreme Court affirmed the constitutionality of the taxes imposed by
the Sugar Adjustment Act, stating that the protection and promotion of the sugar
industry is a valid exercise of the state's police power. The Court held that the
legislature has the power to determine what is necessary for the industry's protection
and expedient for its promotion. The Court also emphasized that it is within the state's
power to select the subjects of taxation and that inequalities resulting from singling out
a particular class for taxation do not violate constitutional limitations.
 BINAY vs. DOMINGO

Facts:
The case of Binay v. Domingo involves the validity of Resolution No. 60, which provided
financial assistance to bereaved families. On September 27, 1988, the Municipality of
Makati approved Resolution No. 60, which confirmed and ratified the ongoing Burial
Assistance Program initiated by the Office of the Mayor. The program extended financial
assistance of five hundred pesos (P500.00) to bereaved families, with funds taken from
the unappropriated available funds in the municipal treasury. The beneficiaries of the
program were bereaved families of Makati whose gross family income did not exceed
two thousand pesos (P2,000.00) a month. The Metro Manila Commission approved
Resolution No. 60, and a disbursement fund of four hundred thousand pesos
(P400,000.10) was certified for the implementation of the program. However, the
Commission on Audit (COA) disapproved Resolution No. 60 and disallowed the
disbursement of funds for its implementation. The petitioners filed letters for
reconsideration, but they were denied by the COA.

Issue:
The main issue in the case is whether or not Resolution No. 60 is a valid exercise of
police power under the general welfare clause.

Ruling:
The court ruled in favor of the petitioners and held that Resolution No. 60 is a valid
exercise of police power. The court explained that police power is a governmental
function, an inherent attribute of sovereignty, which is founded on the maxims "Sic
utere tuo et alienum non laedas" and "Salus populi est suprema lex." Its fundamental
purpose is securing the general welfare, comfort, and convenience of the people.
Municipal governments exercise this power under the general welfare clause, and they
are authorized to enact ordinances and issue regulations necessary to carry out their
responsibilities and provide for the health, safety, comfort, and convenience of the
municipality and its inhabitants. The court emphasized that police power is elastic and
must be responsive to various social conditions.

In this case, the court found that Resolution No. 60, which provided financial assistance
to bereaved families, is a valid exercise of police power as it promotes the general
welfare and provides relief to pauperism. The court also addressed the objection raised
by the COA that the resolution should be for the benefit of the whole or majority of the
inhabitants of the municipality and not just a few individuals. The court held that public
purpose is not unconstitutional merely because it incidentally benefits a limited number
of persons. The care for the poor is recognized as a public duty, and the support for the
poor is an accepted exercise of police power in the promotion of the common good. The
court further stated that there is no violation of the equal protection clause in
classifying paupers as the subject of legislation, as different groups may receive varying
treatment.

In conclusion, the court ruled that Resolution No. 60 is a valid exercise of police power
under the general welfare clause. The Burial Assistance Program provided financial
assistance to bereaved families and promoted the general welfare. However, the court
cautioned that this decision should not be taken as a precedent for municipal
governments to engage in excessive dole-outs for political or other motives.
G.R. No. 91649 May 14, 1991
ATTORNEYS HUMBERTO BASCO, EDILBERTO BALCE, SOCRATES MARANAN AND
LORENZO SANCHEZ, petitioners,
vs.
PHILIPPINE AMUSEMENTS AND GAMING CORPORATION (PAGCOR), respondent.

Facts:
The case of Basco v. Philippine Amusements and Gaming Corp. involves attorneys
Humberto Basco, Edilberto Balce, Socrates Maranan, and Lorenzo Sanchez challenging
the constitutionality of a decree creating the Philippine Amusements and Gaming
Corporation (PAGCOR). PAGCOR was created by virtue of Presidential Decree (P.D.)
1067-A on January 1, 1977, and its subsequent creation under P.D. 1869 on July 11,
1983. PAGCOR's purpose is to centralize and integrate all games of chance not
authorized by existing franchises or permitted by law. It operates and regulates
gambling casinos nationwide and is exempt from local taxes. PAGCOR is a government-
owned or controlled corporation with a dual role of operating and regulating gambling
casinos.

Issue:
Whether the creation of PAGCOR constitutes a waiver of the right of local government to
impose taxes and local fees.
Whether the creation of PAGCOR violates the principle of local autonomy.
Whether the creation of PAGCOR violates the equal protection clause.
Whether the creation of PAGCOR goes against the trend of the government towards free
enterprise and privatization.

Ruling:
The Supreme Court rules in favor of the constitutionality of the decree creating
PAGCOR.
The court explains that every presumption must be indulged in favor of the
constitutionality of a statute. It also states that the power to regulate or prohibit
gambling is a state concern and falls within the authority of the legislative and executive
branches of government. The court further argues that PAGCOR, being a government
instrumentality, is exempt from local taxes to prevent its operation from being
burdened or controlled by local governments. The court also finds no violation of the
equal protection clause, as the state may treat different occupations differently as long
as the classification is not unreasonable or arbitrary.

In a separate concurring opinion, Justice Padilla agrees with the decision but expresses
his personal disapproval of gambling in any form. He believes that gambling is
detrimental to the Filipino moral character and opposes the government's involvement
in legalized gambling.

In conclusion, the Supreme Court upholds the constitutionality of the decree creating
PAGCOR and dismisses the petition. The court emphasizes the importance of the
presumption of constitutionality and the role of the political branches of government in
deciding state policies.