Sangalang vs. IAC G.R.

71169 December 22, 1988

Facts:
August 12, 1977, the municipal officials of Makati, destroyed
and removed the gates constructed/located at the corner of
Reposo Street and Jupiter Street as well as the gates/fences
located/constructed at Jupiter Street and Makati Avenue
forcibly, and then opened the entire length of Jupiter Street
to public traffic. Subsequently, Petitioners brought the
present action for damages against the defendant-appellant
Ayala Corporation predicated on both breach of contract and
on tort or quasi-delict A supplemental complaint was later
filed by said Petitioners seeking to augment the reliefs
prayed for in the original complaint because of alleged
supervening events which occurred during the trial of the
case. That the exclusivity of the said village was adversely
affected and diminished due to the opening of the said
streets to the public. That the exclusivity of the said village
was guaranteed in the restrictions of TCT.
Issue:
Whether the Right to Non-Impairment of Contracts of the
complainants was violated by the Respondents in an
resolution promoting the welfare of the general public?
Decision:
No, 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 and general
welfare of the people.’ Invariably described as “the most
essential, insistent, and illimitable of powers” and “in a
sense, the greatest and most powerful attribute of
government,” the exercise of the power may be judicially
inquired into and corrected only if it is capricious, whimsical,
unjust or unreasonable, there having been a denial of due
process or a violation of any other applicable constitutional
guarantee. Police power is elastic and must be responsive to
various social conditions; it is not confined within narrow
circumscriptions of precedents resting on past conditions; it
must follow the legal progress of a democratic way of life.
The court do not see why public welfare when clashing with
the individual right to property should not be made to prevail
through the state’s exercise of its police power.