National Liga ng mga Barangay v.

Paredes Facts: On 11 June 1997, Rayos, Punong Barangay of Barangay 52, District II, Zone 5, District II, Caloocan City, filed a petition for prohibition and mandamus, with prayer for a writ of preliminary injunction and/or temporary restraining order and damages before the RTC of Caloocan, alleging that David, Punong Barangay of Barangay 77, Zone 7, Caloocan City and then president of the Liga Chapter of Caloocan City and of the Liga ng mga Barangay National Chapter, committed certain irregularities in the notice, venue and conduct of the proposed synchronized Liga ng mga Barangay elections in 1997. On 13 June 1997, the Executive Judge issued a temporary restraining order (TRO), effective for seventy-two (72) hours, enjoining the holding of the general membership and election meeting of Liga Chapter of Caloocan City on 14 June 1975. However, the TRO was allegedly not properly served on herein petitioner David, and so the election for the officers of the Liga-Caloocan was held as scheduled. Petitioner David was proclaimed President of the Liga-Caloocan, and thereafter took his oath and assumed the position of exofficio member of the Sangguniang Panlungsod of Caloocan. On 17 July 1997, respondent Rayos filed a second petition, this time for quo warranto, mandamus and prohibition, with prayer for a writ of preliminary injunction and/or temporary restraining order and damages, against David, Nancy Quimpo, Presiding Officer of the Sangguniang Panlungsod of Caloocan City, and Secretary Barbers.7 Rayos alleged that he was elected President of the Liga Caloocan Chapter in the elections held on 14 June 1997 by the members of the Caloocan Chapter pursuant to their Resolution/Petition No. 001-97.8 On 18 July 1997, the presiding judge granted the TRO, enjoining therein respondents David, Quimpo and Secretary Barbers from proceeding with the synchronized elections for the Provincial and Metropolitan Chapters of the Liga scheduled on 19 July 1997, but only for the purpose of maintaining the status quo and effective for a period not exceeding seventy-two (72) hours. Eventually, on 18 July 1997, at petitioner Davids instance, Special Civil Action (SCA) No. C-512 pending before Branch 126 was consolidated with SCA No. C-508 pending before Branch 124. Before the consolidation of the cases, on 25 July 1997, the DILG through respondent Secretary Barbers, filed in SCA No. C-512 an Urgent Motion, invoking the Presidents power of general supervision over all local government units and seeking that the DILG pursuant to its delegated power of general supervision, be appointed as the Interim Caretaker to manage and administer the affairs of the Liga, until such time that the new set of National Liga Officers shall have been duly elected and assumed office.

Issue: WON the Liga ng mga Barangay is subject to DILG supervision. Bito-Onon v. Fernandez: Court ruled that the Presidents power of the general supervision, as exercised therein by the DILG Secretary as his alter ego, extends to the Liga ng mga Barangay. Does the Presidents power of general supervision extend to the liga ng mga barangay, which is not a local government unit? We rule in the affirmative. In Opinion No. 41, Series of 1995, the Department of Justice ruled that the liga ng mga barangay is a government organization, being an association, federation, league or union created by law or by authority of law, whose members are either appointed or elected government officials. The Local Government Code defines the liga ng mga barangay as an organization of all barangays for the primary purpose of determining the representation of the liga in the sanggunians, and for ventilating, articulating and crystallizing issues affecting barangay government administration and securing, through proper and legal means, solutions thereto. The rationale for making the Liga subject to DILG supervision is quite evident, whether from the perspectives of logic or of practicality. The Liga is an aggroupment of barangays which are in turn represented therein by their respective punong barangays. The representatives of the Liga sit in an ex officio capacity at the municipal, city and provincial sanggunians. As such, they enjoy all the powers and discharge all the functions of regular municipal councilors, city councilors or provincial board members, as the case may be. Thus, the Liga is the vehicle through which the barangay participates in the enactment of ordinances and formulation of policies at all the legislative local levels higher than the sangguniang barangay, at the same time serving as the mechanism for the bottom-totop approach of development. In the case at bar, even before the respondent Judge designated the DILG as interim caretaker of the Liga, on 28 July 1997, it issued Memorandum Circular No. 97-176, directing local government officials not to recognize David as the National Liga President and his pronouncements relating to the affairs of the Liga. Not only was the action premature, it even smacked of superciliousness and injudiciousness. The DILG is the topmost government agency which maintains coordination with, and exercises supervision over local government units and its multi-level leagues. As such, it should be forthright, circumspect and supportive in its dealings with the Ligas especially the Liga ng mga Barangay. The indispensable role played by the latter in the development of the barangays and the promotion of the welfare of the inhabitants thereof deserve no less than the full support and respect of the other agencies of government. As the Court held in the case of San Juan v. Civil Service Commission,92 our national

officials should not only comply with the constitutional provisions on local autonomy but should also appreciate the spirit of liberty upon which these provisions are based. When the respondent judge eventually appointed the DILG as interim caretaker to manage and administer the affairs of the Liga, she effectively removed the management from the National Liga Board and vested control of the Liga on the DILG. Even a cursory glance at the DILGs prayer for appointment as interim caretaker of the Liga "to manage and administer the affairs of the Liga, until such time that the new set of National Liga officers shall have been duly elected and assumed office" reveals that what the DILG wanted was to take control over the Liga. Even if said "caretakership" was contemplated to last for a limited time, or only until a new set of officers assume office, the fact remains that it was a conferment of control in derogation of the Constitution. With his Department already appointed as interim caretaker of the Liga, Secretary Barbers nullified the results of the Liga elections and promulgated DILG Memorandum Circular No. 97-193 dated 11 August 1997, where he laid down the supplemental guidelines for the 1997 synchronized elections of the provincial and metropolitan chapters and for the election of the national chapter of the Liga ng mga Barangay; scheduled dates for the new provincial, metropolitan and national chapter elections; and appointed respondent Rayos as president of Liga-Caloocan Chapter. These acts of the DILG went beyond the sphere of general supervision and constituted direct interference with the political affairs, not only of the Liga, but more importantly, of the barangay as an institution. The election of Liga officers is part of the Ligas internal organization, for which the latter has already provided guidelines. In succession, the DILG assumed stewardship and jurisdiction over the Liga affairs, issued supplemental guidelines for the election, and nullified the effects of the Liga-conducted elections. Clearly, what the DILG wielded was the power of control which even the President does not have. Furthermore, the DILG assumed control when it appointed respondent Rayos as president of the Liga-Caloocan Chapter prior to the newly scheduled general Liga elections, although petitioner Davids term had not yet expired. The DILG substituted its choice, who was Rayos, over the choice of majority of the punong barangay of Caloocan, who was the incumbent President, petitioner David. The latter was elected and had in fact been sitting as an exofficio member of the sangguniang panlungsod in accordance with the Liga Constitution and By-Laws. Yet, the DILG extended the appointment to respondent Rayos although it was aware that the position was the subject of a quo warranto proceeding instituted by Rayos himself, thereby preempting the outcome of that case. It was bad enough that the DILG assumed the power of control, it was worse when it made use of the power with evident bias and partiality. As the entity exercising supervision over the Liga ng mga Barangay, the DILGs authority over the Liga is limited to seeing to it that the rules are followed, but it cannot lay down such rules itself, nor does it have the discretion to modify or replace them. In this particular case, the most that the DILG could do was review the acts of the incumbent officers of the Liga in the conduct of the elections to determine if they committed any violation of the Ligas Constitution and By-laws and its implementing rules. If the National Liga Board and its officers had violated Liga rules, the DILG should have ordered the Liga to conduct another election in accordance with the Ligas own rules, but not in obeisance to DILG-dictated guidelines. Neither had the DILG the authority to remove the incumbent officers of the Liga and replace them, even temporarily, with unelected Liga officers. Like the local government units, the Liga ng mga Barangay is not subject to control by the Chief Executive or his alter ego. In the Bito-Onon94 case, this Court held that DILG Memorandum Circular No. 97-193, insofar as it authorized the filing of a petition for review of the decision of the Board of Election Supervisors (BES) with the regular courts in a post-proclamation electoral protest, involved the exercise of control as it in effect amended the guidelines already promulgated by the Liga. Officers in control, lay down the rules in the doing of an act. If they are not followed, it is discretionary on his part to order the act undone or redone by his subordinate or he may even decide to do it himself. Supervision does not cover such authority. Supervising officers merely see to it that the rules are followed, but he himself does not lay down such rules, nor does he have the discretion to modify or replace them. If the rules are not observed, he may order the work done or re-done to conform for to the prescribed rules. He cannot prescribe his own manner the doing of the act. The amendment of the GUIDELINES is more than an exercise of the power of supervision but is an exercise of the power of control, which the President does not have over the LIGA. Although the DILG is given the power to prescribe rules, regulations and other issuances, the Administrative Code limits its authority to merely "monitoring compliance by local government units of such issuances. To monitor means to "watch, observe or check" and is compatible with the power of supervision of the DILG Secretary over local governments, which is limited to checking whether the local government unit concerned or the officers thereof perform their duties as per statutory enactments. Besides, any doubt as to the power of the

DILG Secretary to interfere with local affairs should be resolved in favor of the greater autonomy of the local government. In Taule,96 the Court ruled that the Secretary of Local Government had no authority to pass upon the validity or regularity of the election of officers of katipunan ng mga barangay or barangay councils. In that case, a protest was lodged before the Secretary of Local Government regarding several irregularities in, and seeking the nullification of, the election of officers of the Federation of Associations of Barangay Councils (FABC) of Catanduanes. Then Local Government Secretary Luis Santos issued a resolution nullifying the election of officers and ordered a new one to be conducted. The Court ruled: Construing the constitutional limitation on the power of general supervision of the President over local governments, We hold that respondent Secretary has no authority to pass upon the validity or regularity of the officers of the katipunan. To allow respondent Secretary to do so will give him more power than the law or the Constitution grants. It will in effect give him control over local government officials for it will permit him to interfere in a purely democratic and non-partisan activity aimed at strengthening the barangay as the basic component of local governments so that the ultimate goal of fullest autonomy may be achieved. In fact, his order that the new elections to be conducted be presided by the Regional Director is a clear and direct interference by the Department with the political affairs of the barangays which is not permitted by the limitation of presidential power to general supervision over local governments. All given, the Court is convinced that the assailed order was issued with grave abuse of discretion while the acts of the respondent Secretary, including DILG Memorandum Circulars No. 97-176 and No. 97-193, are unconstitutional and ultra vires, as they all entailed the conferment or exercise of control a power which is denied by the Constitution even to the President.

Bito-Onon v. Fernandez Facts: Joel Bito-Onon is the duly elected Barangay Chairman of Barangay Tacras, Narra, Palawan and is the Municipal Liga Chapter President for the Municipality of Narra, Palawan. The private respondent, Elegio Quejano, Jr. on the other hand, is the duly elected Barangay Chairman of Barangay Rizal, Magsaysay, Palawan and is the Municipal Liga Chapter President for the Municipality of Magsaysay, Palawan. Both Onon and Quejano were candidates for the position of Executive Vice-President in the August 23, 1997 election for the Liga ng Barangay Provincial Chapter of the province of Palawan. Onon was proclaimed the winning candidate in the said election prompting Quejano to file a post proclamation protest with the Board of Election Supervisors (BES), which was decided against him on August 25, 1997. Not satisfied with the decision of the BES, Quejano filed a Petition for Review of the decision of the BES with the Regional Trial Court of Palawan and Puerto Princesa City (RTC). On April 26, 1999, Onon filed a motion to dismiss the Petition for Review raising the issue of jurisdiction. Onon claimed that the RTC had no jurisdiction to review the decisions rendered by the BES in any post proclamation electoral protest in connection with the 1997 Liga ng mga Barangay election of officers and directors. In his motion to dismiss, Onon claimed that the Supplemental Guidelines for the 1997 Liga ng mga Barangay election issued by the DILG on August 11, 1997 in its Memorandum Circular No. 97-193, providing for review of decisions or resolutions of the BES by the regular courts of law is an ultra vires act and is void for being issued without or in excess of jurisdiction, as its issuance is not a mere act of supervision but rather an exercise of control over the Liga's internal organization. On June 22, 1999, the RTC denied Onon's motion to dismiss. In its order, the RTC ratiocinated that the Secretary of the Department of Interior and Local Government2 is vested with the power "to establish and prescribe rules, regulations and other issuances and implementing laws on the general supervision of local government units and the promotion of local autonomy and monitor compliance thereof by said units."3 The RTC added that DILG Circular No. 97-193 was issued by the DILG Secretary pursuant to his rule-making power as provided for under Section 7, Chapter II, Book IV of the Administrative Code.4 Consequently, the RTC ruled that it had jurisdiction over the petition for review filed by Quejada. Motion for reconsideration of the aforesaid Order was denied prompting the petitioner to file the present petition. Issue: WON the questioned provision in the MC was issued by the DILG secretary in excess of his authority. The resolution of the present controversy requires an examination of the questioned provision of Memorandum Circular No. 97-193 and the Implementing Rules and Guidelines for the 1997 General Elections of the Liga ng mga Barangay Officers and Directors (Guidelines). The memorandum circular reads, insofar as pertinent, as follows: "Any post-proclamation protest must be filed with the BES within twenty-four (24) hours from the closing of the election. The BES shall decide the same within forty-eight (48) hours from receipt thereof. The decision of the BES shall be final and immediately executory without prejudice to the filing of a Petition for Review with the regular courts of law." On the other hand, the GUIDELINES provides that the BES shall have the following among its duties: "To resolve any post-proclamation electoral protest which must be submitted in writing to this Board within twenty-four (24) hours from the close of election; provided said Board shall render its decision within forty-eight (48) hours from receipt hereof; and provided further that the decision must be submitted to the National Liga Headquarters within twentyfour (24) hours from the said decision. The decision of the Board of Election Supervisors in this respect shall be subject to review by the National Liga Board the decision of which shall be final and executory." Memorandum Circular No. 97-193 was issued by the DILG Secretary pursuant to the power of general supervision of the President over all local government units which was delegated to the DILG Secretary by virtue of Administrative Order No. 267 dated February 18, 1992.13 The President's power of general supervision over local government units is conferred upon him by the Constitution.14 The power of supervision is defined as "the power of a superior officer to see to it that lower officers perform their functions in accordance with law."15 This is distinguished from the power of control or "the power of an officer to alter or modify or set aside what a subordinate officer had done in the performance of his duties and to substitute the judgment of the former for the latter." On many occasions in the past, this court has had the opportunity to distinguish the power of supervision from the power of control. In Taule vs. Santos,17 we held that the Chief Executive wielded no more authority than that of checking whether a local government or the officers thereof perform their duties as provided by statutory enactments. He cannot interfere with local governments provided that the same or its officers act within the scope of their authority. Supervisory power, when contrasted with control, is the power of mere oversight over an inferior body; it does not include any restraining authority over such body.18 Officers in control lay down the rules in the doing of an act. If they are not followed, it is discretionary on his part to order the act undone or re-done by his subordinate or he may even decide to do it himself. Supervision does not cover such authority. Supervising officers merely sees to it that the rules are followed, but he himself does not lay down such rules, nor does he have the

discretion to modify or replace them. If the rules are not observed, he may order the work done or re-done to conform to the prescribed rules. He cannot prescribe his own manner for the doing of the act. Does the President's power of general supervision extend to the liga ng mga barangay, which is not a local government unit? We rule in the affirmative. In Opinion No. 41, Series of 1995, the Department of Justice ruled that the liga ng mga barangay is a government organization, being an association, federation, league or union created by law or by authority of law, whose members are either appointed or elected government officials. The Local Government Code21 defines the liga ng mga barangay as an organization of all barangays for the primary purpose of determining the representation of the liga in the sanggunians, and for ventilating, articulating and crystallizing issues affecting barangay government administration and securing, through proper and legal means, solutions thereto.22 The liga shall have chapters at the municipal, city, provincial and metropolitan political subdivision levels. The municipal and city chapters of the liga shall be composed of the barangay representatives of the municipal and city barangays respectively. The duly elected presidents of the component municipal and city chapters shall constitute the provincial chapter or the metropolitan political subdivision chapter. The duly elected presidents of highly urbanized cities, provincial chapters, the Metropolitan Manila chapter and metropolitan political subdivision chapters shall constitute the National Liga ng mga Barangay. The liga at the municipal, city, provincial, metropolitan political subdivision, and national levels directly elect a president, a vice-president and five (5) members of the board of directors. The board shall appoint its secretary and treasurer and create such other positions as it may deem necessary for the management of the chapter. The ligas are primarily governed by the provisions of the Local Government Code.25 However, their respective constitution and by-laws shall govern all other matters affecting the internal organization of the liga not otherwise provided for in the Local Government Code provided that the constitution and by-laws shall be suppletory to the provisions of Book III, Title VI of the Local Government Code and shall always conform to the provisions of the Constitution and existing laws. Having in mind the foregoing principles, we rule that Memorandum Circular No. 97-193 of the DILG insofar as it authorizes the filing a Petition for Review of the decision of the BES with the regular courts in a post proclamation electoral protest is of doubtful constitutionality. We agree with both the petitioner and the Solicitor General that in authorizing the filing of the petition for review of the decision of the BES with the regular courts, the DILG Secretary in effect amended and modified the GUIDELINES promulgated by the National Liga Board and adopted by the LIGA which provides that the decision of the BES shall be subject to review by the National Liga Board. The amendment of the GUIDELINES is more than an exercise of the power of supervision but is an exercise of the power of control, which the President does not have over the LIGA. Although the DILG is given the power to prescribe rules, regulations and other issuances, the Administrative Code limits its authority to merely "monitoring compliance" by local government units of such issuances.27 To monitor means "to watch, observe or check" and is compatible with the power of supervision of the DILG Secretary over local governments, which is limited to checking whether the local government unit concerned or the officers thereof perform their duties as per statutory enactments. Besides, any doubt as to the power of the DILG Secretary to interfere with local affairs should be resolved in favor of the greater autonomy of the local government.

Cawaling v. COMELEC Facts: President Estrada signed into law RA 8806 (Act Creating The City Of Sorsogon By Merging The Municipalities Of Bacon And Sorsogon In The Province Of Sorsogon, And Appropriating Funds Therefor). The COMELEC conducted a plebiscite in Bacon and Sorsogon and submitted the matter for ratification. The Plebiscite City Board of Canvassers (PCBC) then proclaimed the creation of the City of Sorsogon as having been ratified and approved by the majority of the votes cast in the plebiscite. Cawaling, invoking his rights as a taxpayer, filed a petition for certiorari seeking the annulment of the plebiscite and challenging RA 8806. Issues: 1. WON the creation of Sorsogon City by merging two municipalities violates Section 450(a) LGC (in relation to Section 10, Article X of the Constitution) which requires that only "a municipality or a cluster of barangays may be converted into a component city" NO. Criteria for the creation of a city: SECTION 450. Requisites for Creation. (a) A municipality or a cluster of barangays may be converted into a component city if it has an average annual income, as certified by the Department of Finance, of at least Twenty million (P20,000,000.00) for the last two (2) consecutive years based on 1991 constant prices, and if it has either of the following requisites: (i) a contiguous territory of at least one hundred (100) square kilometers, as certified by the Lands Management Bureau; or (ii) a population of not less than one hundred fifty thousand (150,000) inhabitants, as certified by the National Statistics Office: Provided, That, the creation thereof shall not reduce the land area, population, and income of the original unit or units at the time of said creation to less than the minimum requirements prescribed herein. (b) The territorial jurisdiction of a newly-created city shall be properly identified by metes and bounds. The requirement on land area shall not apply where the city proposed to be created is composed of one (1) or more islands. The territory need not be contiguous if it comprises two (2) or more islands. (c) The average annual income shall include the income accruing to the general fund, exclusive of specific funds, transfers, and non-recurring income." Petitioner's constricted reading of Section 450(a) of the Code is erroneous. The phrase "A municipality or a cluster of barangays may be converted into a component city" is not a criterion but simply one of the modes by which a city may be created. Section 10, Article X of the Constitution, quoted earlier and which petitioner cited in support of his posture, allows the merger of LGUs to create a province city, municipality or barangay in accordance with the criteria established by the Code. The creation of an entirely new LGU through a division or a merger of existing LGUs is recognized under the Constitution, provided that such merger or division shall comply with the requirements prescribed by the Code. 2. WON it violates the one bill one subject rule. NO. Petitioner contends that R.A. No. 8806 actually embraces two principal subjects which are: (1) the creation of the City of Sorsogon, and (2) the abolition of the Municipalities of Bacon and Sorsogon. While the title of the Act sufficiently informs the public about the creation of Sorsogon City, petitioner claims that no such information has been provided on the abolition of the Municipalities of Bacon and Sorsogon. Contrary to petitioner's assertion, there is only one subject embraced in the title of the law, that is, the creation of the City of Sorsogon. The abolition/cessation of the corporate existence of the Municipalities of Bacon and Sorsogon due to their merger is not a subject separate and distinct from the creation of Sorsogon City. Such abolition/cessation was but the logical, natural and inevitable consequence of the merger. Otherwise put, it is the necessary means by which the City of Sorsogon was created. Hence, the title of the law, "An Act Creating the City of Sorsogon by Merging the Municipalities of Bacon and Sorsogon in the Province of Sorsogon, and Appropriating Funds Therefor," cannot be said to exclude the incidental effect of abolishing the two municipalities, nor can it be considered to have deprived the public of fair information on this consequence. 3. WON the plebiscite was timely conducted. YES. The law was first published in the August 25, 2000 issue of TODAY a newspaper of general circulation. Then on September 01, 2000, it was published in a newspaper of local circulation in the Province of Sorsogon. Thus, the publication of the law was completed on September 1, 2000, which date, according to the COMELEC, should be the reckoning point in determining the 120-day period within which to conduct the plebiscite, not from the date of its approval (August 16, 2000) when the law had not yet been published. The COMELEC argues that since publication is indispensable for the effectivity of a law,

citing the landmark case of Taada vs. Tuvera, it could only schedule the plebiscite after the Act took effect. Thus, the COMELEC concludes, the December 16, 2000 plebiscite was well within the 120-day period from the effectivity of the law on September 1, 2000 the plebiscite shall be conducted within 120 days from the date of the effectivity of the law, not from its approval. While the same provision allows a law or ordinance to fix "another date" for conducting a plebiscite, still such date must be reckoned from the date of the effectivity of the law. Consequently, the word "approval" in Section 54 of R.A. No. 8806, which should be read together with Section 65 (effectivity of the Act) thereof, could only mean "effectivity" as used and contemplated in Section 10 of the Code. This construction is in accord with the fundamental rule that all provisions of the laws relating to the same subject should be read together and reconciled to avoid inconsistency or repugnancy to established jurisprudence

Batangas v. Romulo Facts: The Province of Batangas, represented by Governor Mandanas, filed the present petition for certiorari, prohibition and mandamus under Rule 65 of the Rules of Court, as amended, to declare as unconstitutional and void certain provisos contained in the General Appropriations Acts (GAA) of 1999, 2000 and 2001, insofar as they uniformly earmarked for each corresponding year the amount of five billion pesos (P5,000,000,000.00) of the Internal Revenue Allotment (IRA) for the Local Government Service Equalization Fund (LGSEF) and imposed conditions for the release thereof. Issue: WON the provisos in the GAAS of 1999-2001 relating to the LGSEF, as well as the Oversight Committees Resolutions issued pursuant thereto are unconstitutional and void Article II of the Constitution, the State has expressly adopted as a policy that: Section 25. The State shall ensure the autonomy of local governments. Consistent with the principle of local autonomy, the Constitution confines the Presidents power over the LGUs to one of general supervision. This provision has been interpreted to exclude the power of control. The distinction between the two powers was enunciated in Drilon v. Lim: An officer in control lays down the rules in the doing of an act. If they are not followed, he may, in his discretion, order the act undone or re-done by his subordinate or he may even decide to do it himself. Supervision does not cover such authority. The supervisor or superintendent merely sees to it that the rules are followed, but he himself does not lay down such rules, nor does he have the discretion to modify or replace them. If the rules are not observed, he may order the work done or re-done but only to conform to the prescribed rules. He may not prescribe his own manner for doing the act. He has no judgment on this matter except to see to it that the rules are followed. The Local Government Code of 1991 was enacted to flesh out the mandate of the Constitution. The State policy on local autonomy is amplified in Section 2 thereof: Sec. 2. Declaration of Policy. (a) It is hereby declared the policy of the State that the territorial and political subdivisions of the State shall enjoy genuine and meaningful local autonomy to enable them to attain their fullest development as self-reliant communities and make them more effective partners in the attainment of national goals. Toward this end, the State shall provide for a more responsive and accountable local government structure instituted through a system of decentralization whereby local government units shall be given more powers, authority, responsibilities, and resources. The process of decentralization shall proceed from the National Government to the local government units. The assailed provisos in the GAAs of 1999, 2000 and 2001 and the OCD resolutions violate the constitutional precept on local autonomy Article X of the Constitution reads: Sec. 6. Local government units shall have a just share, as determined by law, in the national taxes which shall be automatically released to them. When parsed, it would be readily seen that this provision mandates that (1) the LGUs shall have a just share in the national taxes; (2) the just share shall be determined by law; and (3) the just share shall be automatically released to the LGUs. The Local Government Code of 1991, among its salient provisions, underscores the automatic release of the LGUs just share in this wise: Sec. 18. Power to Generate and Apply Resources. Local government units shall have the power and authority to establish an organization that shall be responsible for the efficient and effective implementation of their development plans, program objectives and priorities; to create their own sources of revenue and to levy taxes, fees, and charges which shall accrue exclusively for their use and disposition and which shall be retained by them; to have a just share in national taxes which shall be automatically and directly released to them without need of further action; Sec. 286. Automatic Release of Shares. (a) The share of each local government unit shall be released, without need of any further action, directly to the provincial, city, municipal or barangay treasurer, as the case may be, on a quarterly basis within five (5) days after the end of each quarter, and which shall not be subject to any lien or holdback that may be imposed by the national government for whatever purpose. (b) Nothing in this Chapter shall be understood to diminish the share of local government units under existing laws. Automatic: involuntary either wholly or to a major extent so that any activity of the will is largely negligible; of a reflex nature; without volition; mechanical; like or suggestive of an automaton. As such, the LGUs are not required to perform any act to receive the just share accruing to them from the national coffers. As emphasized by the Local Government Code of 1991, the just share of the LGUs shall be released to them without need of further action. Construing Section 286 of the LGC, we held in Pimentel, Jr. v. Aguirre: Section 4 of AO 372 cannot, however, be upheld. A basic feature of local fiscal autonomy is the automatic release of the shares of LGUs in the National internal revenue. This is mandated by no less than the Constitution. The Local Government Code specifies further that the release shall be made directly to the LGU concerned within five (5) days after every quarter of the year and shall not be subject to any lien or holdback that may be imposed by the national government for

whatever purpose. As a rule, the term SHALL is a word of command that must be given a compulsory meaning. The provision is, therefore, IMPERATIVE. Section 4 of AO 372, however, orders the withholding, effective January 1, 1998, of 10 percent of the LGUs IRA pending the assessment and evaluation by the Development Budget Coordinating Committee of the emerging fiscal situation in the country. Such withholding clearly contravenes the Constitution and the law. Although temporary, it is equivalent to a holdback, which means something held back or withheld, often temporarily. Hence, the temporary nature of the retention by the national government does not matter. Any retention is prohibited. In sum, while Section 1 of AO 372 may be upheld as an advisory effected in times of national crisis, Section 4 thereof has no color of validity at all. The latter provision effectively encroaches on the fiscal autonomy of local governments. Concededly, the President was well-intentioned in issuing his Order to withhold the LGUs IRA, but the rule of law requires that even the best intentions must be carried out within the parameters of the Constitution and the law. Verily, laudable purposes must be carried out by legal methods. The just share of the LGUs is incorporated as the IRA in the appropriations law or GAA enacted by Congress annually. Under the assailed provisos in the GAAs of 1999, 2000 and 2001, a portion of the IRA in the amount of five billion pesos was earmarked for the LGSEF, and these provisos imposed the condition that such amount shall be released to the local government units subject to the implementing rules and regulations, including such mechanisms and guidelines for the equitable allocations and distribution of said fund among local government units subject to the guidelines that may be prescribed by the Oversight Committee on Devolution. Pursuant thereto, the Oversight Committee, through the assailed OCD resolutions, apportioned the five billion pesos LGSEF. Significantly, the LGSEF could not be released to the LGUs without the Oversight Committees prior approval. Further, with respect to the portion of the LGSEF allocated for various projects of the LGUs (P1 billion for 1999; P1.5 billion for 2000 and P2 billion for 2001), the Oversight Committee, through the assailed OCD resolutions, laid down guidelines and mechanisms that the LGUs had to comply with before they could avail of funds from this portion of the LGSEF. The guidelines required (a) the LGUs to identify the projects eligible for funding based on the criteria laid down by the Oversight Committee; (b) the LGUs to submit their project proposals to the DILG for appraisal; (c) the project proposals that passed the appraisal of the DILG to be submitted to the Oversight Committee for review, evaluation and approval. It was only upon approval thereof that the Oversight Committee would direct the DBM to release the funds for the projects. To the Courts mind, the entire process involving the distribution and release of the LGSEF is constitutionally impermissible. The LGSEF is part of the IRA or just share of the LGUs in the national taxes. To subject its distribution and release to the vagaries of the implementing rules and regulations, including the guidelines and mechanisms unilaterally prescribed by the Oversight Committee from time to time, as sanctioned by the assailed provisos in the GAAs of 1999, 2000 and 2001 and the OCD resolutions, makes the release not automatic, a flagrant violation of the constitutional and statutory mandate that the just share of the LGUs shall be automatically released to them. The LGUs are, thus, placed at the mercy of the Oversight Committee. Where the law, the Constitution in this case, is clear and unambiguous, it must be taken to mean exactly what it says, and courts have no choice but to see to it that the mandate is obeyed. Moreover, as correctly posited by the petitioner, the use of the word shall connotes a mandatory order. Its use in a statute denotes an imperative obligation and is inconsistent with the idea of discretion. Indeed, the Oversight Committee exercising discretion, even control, over the distribution and release of a portion of the IRA, the LGSEF, is an anathema to and subversive of the principle of local autonomy as embodied in the Constitution. Moreover, it finds no statutory basis at all as the Oversight Committee was created merely to formulate the rules and regulations for the efficient and effective implementation of the Local Government Code of 1991 to ensure compliance with the principles of local autonomy as defined under the Constitution.*29+ In fact, its creation was placed under the title of Transitory Provisions, signifying its ad hoc character. According to Senator Aquilino Q. Pimentel, the principal author and sponsor of the bill that eventually became Rep. Act No. 7160, the Committees work was supposed to be done a year from the approval of the Code, or on October 10, 1992.[30] The Oversight Committees authority is undoubtedly limited to the implementation of the Local Government Code of 1991, not to supplant or subvert the same. Neither can it exercise control over the IRA, or even a portion thereof, of the LGUs. That the automatic release of the IRA was precisely intended to guarantee and promote local autonomy can be gleaned from the discussion between Messrs. Jose N. Nolledo and Regalado M. Maambong, then members of the 1986 Constitutional Commission.

The concept of local autonomy was explained in Ganzon v. Court of Appeals in this wise: As the Constitution itself declares, local autonomy means a more responsive and accountable local government structure instituted through a system of decentralization. The Constitution, as we observed, does nothing more than to break up the monopoly of the national government over the affairs of local governments and as put by political adherents, to liberate the local governments from the imperialism of Manila. Autonomy, however, is not meant to end the relation of partnership and interdependence between the central administration and local government units, or otherwise, to usher in a regime of federalism. The Charter has not taken such a radical step. Local governments, under the Constitution, are subject to regulation, however limited, and for no other purpose than precisely, albeit paradoxically, to enhance self-government. As we observed in one case, decentralization means devolution of national administration but not power to the local levels. Thus: Now, autonomy is either decentralization of administration or decentralization of power. There is decentralization of administration when the central government delegates administrative powers to political subdivisions in order to broaden the base of government power and in the process to make local governments more responsive and accountable and ensure their fullest development as self-reliant communities and make them more effective partners in the pursuit of national development and social progress. At the same time, it relieves the central government of the burden of managing local affairs and enables it to concentrate on national concerns. The President exercises general supervision over them, but only to ensure that local affairs are administered according to law. He has no control over their acts in the sense that he can substitute their judgments with his own. Decentralization of power, on the other hand, involves an abdication of political power in the [sic] favor of local governments [sic] units declared to be autonomous. In that case, the autonomous government is free to chart its own destiny and shape its future with minimum intervention from central authorities. According to a constitutional author, decentralization of power amounts to self-immolation, since in that event, the autonomous government becomes accountable not to the central authorities but to its constituency. Local autonomy includes both administrative and fiscal autonomy. The fairly recent case of Pimentel v. Aguirre[35] is particularly instructive. The Court declared therein that local fiscal autonomy includes the power of the LGUs to, inter alia, allocate their resources in accordance with their own priorities: Under existing law, local government units, in addition to having administrative autonomy in the exercise of their functions, enjoy fiscal autonomy as well. Fiscal autonomy means that local governments have the power to create their own sources of revenue in addition to their equitable share in the national taxes released by the national government, as well as the power to allocate their resources in accordance with their own priorities. It extends to the preparation of their budgets, and local officials in turn have to work within the constraints thereof. They are not formulated at the national level and imposed on local governments, whether they are relevant to local needs and resources or not. Further, a basic feature of local fiscal autonomy is the constitutionally mandated automatic release of the shares of LGUs in the national internal revenue. Following this ratiocination, the Court in Pimentel struck down as unconstitutional Section 4 of Administrative Order (A.O.) No. 372 which ordered the withholding, effective January 1, 1998, of ten percent of the LGUs IRA pending the assessment and evaluation by the Development Budget Coordinating Committee of the emerging fiscal situation. In like manner, the assailed provisos in the GAAs of 1999, 2000 and 2001, and the OCD resolutions constitute a withholding of a portion of the IRA. They put on hold the distribution and release of the five billion pesos LGSEF and subject the same to the implementing rules and regulations, including the guidelines and mechanisms prescribed by the Oversight Committee from time to time. Like Section 4 of A.O. 372, the assailed provisos in the GAAs of 1999, 2000 and 2001 and the OCD resolutions effectively encroach on the fiscal autonomy enjoyed by the LGUs and must be struck down. They cannot, therefore, be upheld. The assailed provisos in the GAAs of 1999, 2000 and 2001 and the OCD resolutions cannot amend Section 285 of the Local Government Code of 1991 Section 284 of the Local Government Code provides that, beginning the third year of its effectivity, the LGUs share in the national internal revenue taxes shall be 40%. This percentage is fixed and may not be reduced except in the event the national government incurs an unmanageable public sector deficit" and only upon compliance with stringent requirements set forth in the same section: Sec. 284. Provided, That in the event that the national government incurs an unmanageable public sector deficit, the President of the Philippines is hereby authorized, upon recommendation of Secretary of Finance, Secretary of Interior and Local Government and Secretary of Budget and Management, and subject to consultation with the presiding officers of both Houses of Congress and the presidents of the liga, to make the necessary adjustments in the internal revenue allotment of local government units but in no case shall the allotment be less than thirty percent (30%) of the collection of the national internal revenue taxes of the third fiscal year preceding the current fiscal year; Provided,

further That in the first year of the effectivity of this Code, the local government units shall, in addition to the thirty percent (30%) internal revenue allotment which shall include the cost of devolved functions for essential public services, be entitled to receive the amount equivalent to the cost of devolved personnel services. Thus, from the above provision, the only possible exception to the mandatory automatic release of the LGUs IRA is if the national internal revenue collections for the current fiscal year is less than 40 percent of the collections of the preceding third fiscal year, in which case what should be automatically released shall be a proportionate amount of the collections for the current fiscal year. The adjustment may even be made on a quarterly basis depending on the actual collections of national internal revenue taxes for the quarter of the current fiscal year. In the instant case, however, there is no allegation that the national internal revenue tax collections for the fiscal years 1999, 2000 and 2001 have fallen compared to the preceding three fiscal years. Section 285 then specifies how the IRA shall be allocated among the LGUs. However, this percentage sharing is not followed with respect to the five billion pesos LGSEF as the assailed OCD resolutions, implementing the assailed provisos in the GAAs of 1999, 2000 and 2001, provided for a different sharing scheme. For example, for 1999, P2 billion of the LGSEF was allocated as follows: Provinces 40%; Cities 20%; Municipalities 40%.[39] For 2000, P3.5 billion of the LGSEF was allocated in this manner: Provinces 26%; Cities 23%; Municipalities 35%; Barangays 26%.[40] For 2001, P3 billion of the LGSEF was allocated, thus: Provinces 25%; Cities 25%; Municipalities 35%; Barangays 15%.[41] The respondents argue that this modification is allowed since the Constitution does not specify that the just share of the LGUs shall only be determined by the Local Government Code of 1991. That it is within the power of Congress to enact other laws, including the GAAs, to increase or decrease the just share of the LGUs. This contention is untenable. The Local Government Code of 1991 is a substantive law. And while it is conceded that Congress may amend any of the provisions therein, it may not do so through appropriations laws or GAAs. Any amendment to the Local Government Code of 1991 should be done in a separate law, not in the appropriations law, because Congress cannot include in a general appropriation bill matters that should be more properly enacted in a separate legislation. A general appropriations bill is a special type of legislation, whose content is limited to specified sums of money dedicated to a specific purpose or a separate fiscal unit.[43] Any provision therein which is intended to amend another law is considered an inappropriate provision. The category of inappropriate provisions includes unconstitutional provisions and provisions which are intended to amend other laws, because clearly these kinds of laws have no place in an appropriations bill. Increasing or decreasing the IRA of the LGUs or modifying their percentage sharing therein, which are fixed in the Local Government Code of 1991, are matters of general and substantive law. To permit Congress to undertake these amendments through the GAAs, as the respondents contend, would be to give Congress the unbridled authority to unduly infringe the fiscal autonomy of the LGUs, and thus put the same in jeopardy every year. This, the Court cannot sanction. It is relevant to point out at this juncture that, unlike those of 1999, 2000 and 2001, the GAAs of 2002 and 2003 do not contain provisos similar to the herein assailed provisos. In other words, the GAAs of 2002 and 2003 have not earmarked any amount of the IRA for the LGSEF. Congress had perhaps seen fit to discontinue the practice as it recognizes its infirmity. Nonetheless, as earlier mentioned, this Court has deemed it necessary to make a definitive ruling on the matter in order to prevent its recurrence in future appropriations laws and that the principles enunciated herein would serve to guide the bench, bar and public.

League of Cities v. COMELEC Facts: 11th Congress: 33 bills converting 33 municipalities into cities were enacted. However, Congress did not act on bills converting 24 other municipalities into cities. 12th Congress: RA 9009 which amended Sec. 450 of the LGC by increasing the annual income requirement for conversion of a municipality into a city from P20 million to P100 million was enacted. The rationale for the amendment was to restrain, in the words of Sen. Pimentel, the mad rush of municipalities to convert into cities solely to secure a larger share in the Internal Revenue Allotment despite the fact that they are incapable of fiscal independence. After the effectivity of RA 9009, the House adopted Joint Resolution No. 29 which sought to exempt from the P100 million income requirement in RA 9009 the 24 municipalities whose cityhood bills were not approved in the 11th Congress. However, the 12th Congress ended without the Senate approving Joint Resolution No. 29. 13th Congress: JR 29 was re-adopted as JR 1 and was forwarded to the Senate for approval. However, the Senate again failed to approve the Joint Resolution. Following the advice of Sen.Pimentel, 16 municipalities filed, through their respective sponsors, individual cityhood bills. The 16 cityhood bills contained a common provision exempting all the 16 municipalities from the P100 million income requirement in RA 9009. On 22 December 2006, the House of Representatives approved the cityhood bills. The Senate also approved the cityhood bills in February 2007, except that of Naga, Cebu which was passed on 7 June 2007. The cityhood bills lapsed into law without the Presidents signature. The Cityhood Laws direct the COMELEC to hold plebiscites to determine whether the voters in each respondent municipality approve of the conversion of their municipality into a city. Petitioners filed the present petitions to declare the Cityhood Laws unconstitutional for violation of Section 10, Article X of the Constitution, as well as for violation of the equal protection clause. Petitioners also lament that the wholesale conversion of municipalities into cities will reduce the share of existing cities in the Internal Revenue Allotment because more cities will share the same amount of internal revenue set aside for all cities under Section 285 of the LGC. Issues: 1. WON RA 9009 violates the principle of non-retroactivity. NO Congress passed the Cityhood Laws long after the effectivity of RA 9009. RA 9009 became effective on 30 June 2001 or during the 11th Congress. The 13th Congress passed in December 2006 the cityhood bills which became law only in 2007. Thus, respondent municipalities cannot invoke the principle of non-retroactivity of laws. This basic rule has no application because RA 9009, an earlier law to the Cityhood Laws, is not being applied retroactively but prospectively. 2. WON RA 9009 violates Sec 10 Art X of the Constitution. The Constitution is clear. The creation of local government units must follow the criteria established in the LGC and not in any other law. There is only one LGC. The Constitution requires Congress to stipulate in the LGC all the criteria necessary for the creation of a city, including the conversion of a municipality into a city. Congress cannot write such criteria in any other law, like the Cityhood Laws. The criteria prescribed in the LGC govern exclusively the creation of a city. No other law, not even the charter of the city, can govern such creation. The clear intent of the Constitution is to insure that the creation of cities and other political units must follow the same uniform, nondiscriminatory criteria found solely in the LGC. Any derogation or deviation from the criteria prescribed in the LGC violates Section 10, Article X of the Constitution. RA 9009 amended Section 450 of the LGC to increase the income requirement from P20 million to P100 million for the creation of a city. This took effect on 30 June 2001. Hence, from that moment the LGC required that any municipality desiring to become a city must satisfy the P100 million income requirement. Section 450 of the LGC, as amended by RA 9009, does not contain any exemption from this income requirement. In enacting RA 9009, Congress did not grant any exemption to respondent municipalities, even though their cityhood bills were pending in Congress when Congress passed RA 9009. The Cityhood Laws, all enacted after the effectivity of RA 9009, explicitly exempt respondent municipalities from the increased income requirement in Section 450 of the LGC, as amended by RA 9009. Such exemption clearly violates Section 10, Article X of the Constitution and is thus patently unconstitutional. To be valid, such exemption must be written in the LGC and not in any other law, including the Cityhood Laws. There can be no resort to extrinsic aids like deliberations of Congress if the language of the law is plain, clear and unambiguous. Courts determine the intent of the law from the literal language of the law, within the laws four corners. If the language of the law is plain, clear and unambiguous, courts simply apply the law according to its express terms. If a literal application of the law results in absurdity, impossibility or injustice, then courts may resort to extrinsic aids of statutory construction like the legislative history of the law. Congress, in enacting RA 9009 to amend Section 450 of the LGC, did not provide any exemption from the increased income requirement, not even to respondent municipalities whose cityhood bills were then pending when Congress passed RA 9009. Section 450 of the LGC, as amended by RA 9009, contains no exemption whatsoever. Since the

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law is clear, plain and unambiguous that any municipality desiring to convert into a city must meet the increased income requirement, there is no reason to go beyond the letter of the law in applying Section 450 of the LGC, as amended by RA 9009. True, members of Congress discussed exempting respondent municipalities from RA 9009, as shown by the various deliberations on the matter during the 11th Congress. However, Congress did not write this intended exemption into law. Congress could have easily included such exemption in RA 9009 but Congress did not. This is fatal to the cause of respondent municipalities because such exemption must appear in RA 9009 as an amendment to Section 450 of the LGC. The Constitution requires that the criteria for the conversion of a municipality into a city, including any exemption from such criteria, must all be written in the LGC. Congress cannot prescribe such criteria or exemption from such criteria in any other law. In short, Congress cannot create a city through a law that does not comply with the criteria or exemption found in the LGC. WON the Cityhood Laws violate Sec 6Art X of the Constitution. Uniform and non-discriminatory criteria as prescribed in the LGC are essential to implement a fair and equitable distribution of national taxes to all local government units. Section 6, Article X of the Constitution provides: Local government units shall have a just share, as determined by law, in the national taxes which shall be automatically released to them. If the criteria in creating local government units are not uniform and discriminatory, there can be no fair and just distribution of the national taxes to local government units. A city with an annual income of only P20 million, all other criteria being equal, should not receive the same share in national taxes as a city with an annual income of P100 million or more. The criteria of land area, population and income, as prescribed in Section 450 of the LGC, must be strictly followed because such criteria, prescribed by law, are material in determining the just share of local government units in national taxes. Since the Cityhood Laws do not follow the income criterion in Section 450 of the LGC, they prevent the fair and just distribution of the Internal Revenue Allotment in violation of Section 6, Article X of the Constitution. WON the deliberations of unapproved bills by the 11th Congress may be used as basis for those approved by the 12th . NO Congress is not a continuing body. The unapproved cityhood bills filed during the 11th Congress became mere scraps of paper upon the adjournment of the 11th Congress. All the hearings and deliberations conducted during the 11th Congress on unapproved bills also became worthless upon the adjournment of the 11th Congress. These hearings and deliberations cannot be used to interpret bills enacted into law in the 13th or subsequent Congresses. The members and officers of each Congress are different. All unapproved bills filed in one Congress become functus officio upon adjournment of that Congress and must be re-filed anew in order to be taken up in the next Congress. When their respective authors re-filed the cityhood bills in 2006 during the 13th Congress, the bills had to start from square one again, going through the legislative mill just like bills taken up for the first time, from the filing to the approval. The deliberations during the 11th Congress on the unapproved cityhood bills, as well as the deliberations during the 12th and 13th Congresses on the unapproved resolution exempting from RA 9009 certain municipalities, have no legal significance. They do not qualify as extrinsic aids in construing laws passed by subsequent Congresses. WON the equal protection clause was violated. If Section 450 of the LGC, as amended by RA 9009, contained an exemption to the P100 million annual income requirement, the criteria for such exemption could be scrutinized for possible violation of the equal protection clause. Thus, the criteria for the exemption, if found in the LGC, could be assailed on the ground of absence of a valid classification. However, Section 450 of the LGC, as amended by RA 9009, does not contain any exemption. The exemption is contained in the Cityhood Laws, which are unconstitutional because such exemption must be prescribed in the LGC as mandated in Section 10, Article X of the Constitution. Even if the exemption provision in the Cityhood Laws were written in Section 450 of the LGC, as amended by RA 9009, such exemption would still be unconstitutional for violation of the equal protection clause. The exemption provision merely states, Exemption from Republic Act No. 9009 The City of x x x shall be exempted from the income requirement prescribed under Republic Act No. 9009. This one sentence exemption provision contains no classification standards or guidelines differentiating the exempted municipalities from those that are not exempted. Even if we take into account the deliberations in the 11th Congress that municipalities with pending cityhood bills should be exempt from the P100 million income requirement, there is still no valid classification to satisfy the equal protection clause. The exemption will be based solely on the fact that the 16 municipalities had cityhood bills pending in the 11th Congress when RA 9009 was enacted. This is not a valid classification between those entitled and those not entitled to exemption from the P100 million income requirement.

To be valid, the classification in the present case must be based on substantial distinctions, rationally related to a legitimate government objective which is the purpose of the law, [23] not limited to existing conditions only, and applicable to all similarly situated. Thus, this Court has ruled: The equal protection clause of the 1987 Constitution permits a valid classification under the following conditions: 1. The classification must rest on substantial distinctions; 2. The classification must be germane to the purpose of the law; 3. The classification must not be limited to existing conditions only; and 4. The classification must apply equally to all members of the same class. There is no substantial distinction between municipalities with pending cityhood bills in the 11th Congress and municipalities that did not have pending bills. The mere pendency of a cityhood bill in the 11th Congress is not a material difference to distinguish one municipality from another for the purpose of the income requirement. The pendency of a cityhood bill in the 11th Congress does not affect or determine the level of income of a municipality. Municipalities with pending cityhood bills in the 11th Congress might even have lower annual income than municipalities that did not have pending cityhood bills. In short, the classification criterion mere pendency of a cityhood bill in the 11th Congress is not rationally related to the purpose of the law which is to prevent fiscally non-viable municipalities from converting into cities. Municipalities that did not have pending cityhood bills were not informed that a pending cityhood bill in the 11th Congress would be a condition for exemption from the increased P100 million income requirement. Had they been informed, many municipalities would have caused the filing of their own cityhood bills. These municipalities, even if they have bigger annual income than the 16 respondent municipalities, cannot now convert into cities if their income is less than P100 million. The fact of pendency of a cityhood bill in the 11th Congress limits the exemption to a specific condition existing at the time of passage of RA 9009. That specific condition will never happen again. This violates the requirement that a valid classification must not be limited to existing conditions only. This requirement is illustrated in Mayflower Farms, Inc. v. Ten Eyck, where the challenged law allowed milk dealers engaged in business prior to a fixed date to sell at a price lower than that allowed to newcomers in the same business. In Mayflower, the U.S. Supreme Court held: We are referred to a host of decisions to the effect that a regulatory law may be prospective in operation and may except from its sweep those presently engaged in the calling or activity to which it is directed. Examples are statutes licensing physicians and dentists, which apply only to those entering the profession subsequent to the passage of the act and exempt those then in practice, or zoning laws which exempt existing buildings, or laws forbidding slaughterhouses within certain areas, but excepting existing establishments. The challenged provision is unlike such laws, since, on its face, it is not a regulation of a business or an activity in the interest of, or for the protection of, the public, but an attempt to give an economic advantage to those engaged in a given business at an arbitrary date as against all those who enter the industry after that date. The appellees do not intimate that the classification bears any relation to the public health or welfare generally; that the provision will discourage monopoly; or that it was aimed at any abuse, cognizable by law, in the milk business. In the absence of any such showing, we have no right to conjure up possible situations which might justify the discrimination. The classification is arbitrary and unreasonable and denies the appellant the equal protection of the law. In the same vein, the exemption provision in the Cityhood Laws gives the 16 municipalities a unique advantage based on an arbitrary date the filing of their cityhood bills before the end of the 11th Congress as against all other municipalities that want to convert into cities after the effectivity of RA 9009. Furthermore, limiting the exemption only to the 16 municipalities violates the requirement that the classification must apply to all similarly situated. Municipalities with the same income as the 16 respondent municipalities cannot convert into cities, while the 16 respondent municipalities can. Clearly, as worded the exemption provision found in the Cityhood Laws, even if it were written in Section 450 of the LGC, would still be unconstitutional for violation of the equal protection clause.

Pelaez vs Auditor General From Sept 04 to Oct 29, 1964, the President (Marcos) issued executive orders creating 33 municipalities this is purportedly in pursuant to Sec 68 of the Revised Administrative Code which provides that the President of the Philippines may by executive order define the boundary, or boundaries, of any province, sub-province, municipality, [township] municipal district or other political subdivision, and increase or diminish the territory comprised therein, may divide any province into one or more subprovincesThe VP Emmanuel Pelaez and a taxpayer filed a special civil action to prohibit the auditor general from disbursing funds to be appropriated for the said municipalities. Pelaez claims that the EOs are unconstitutional. He said that Sec 68 of the RAC has been impliedly repealed by Sec 3 of RA 2370 which provides that barrios may not be created or their boundaries altered nor their names changed except by Act of Congress or of the corresponding provincial board upon petition of a majority of the voters in the areas affected and the recommendation of the council of the municipality or municipalities in which the proposed barrio is situated. Pelaez argues, accordingly: If the President, under this new law, cannot even create a barrio, can he create a municipality which is composed of several barrios, since barrios are units of municipalities? The Auditor General countered that only barrios are barred from being created by the President. Municipalities are exempt from the bar and that t a municipality can be created without creating barrios. Existing barrios can just be placed into the new municipality. This theory overlooks, however, the main import of Pelaez argument, which is that the statutory denial of the presidential authority to create a new barrio implies a negation of the bigger power to create municipalities, each of which consists of several barrios. ISSUE: Whether or not Congress has delegated the power to create barrios to the President by virtue of Sec 68 of the RAC. HELD: Although Congress may delegate to another branch of the government the power to fill in the details in the execution, enforcement or administration of a law, it is essential, to forestall a violation of the principle of separation of powers, that said law: (a) be complete in itself it must set forth therein the policy to be executed, carried out or implemented by the delegate and (b) fix a standard the limits of which are sufficiently determinate or determinable to which the delegate must conform in the performance of his functions. Indeed, without a statutory declaration of policy, the delegate would, in effect, make or formulate such policy, which is the essence of every law; and, without the aforementioned standard, there would be no means to determine, with reasonable certainty, whether the delegate has acted within or beyond the scope of his authority. In the case at bar, the power to create municipalities is eminently legislative in character not administrative.