G.R. No.

137705

August 22, 2000

SERG'S PRODUCTS, INC., and SERGIO T.

GOQUIOLAY, petitioners,
vs.
PCI LEASING AND FINANCE, INC., respondent.
DECISION
PANGANIBAN, J.:
After agreeing to a contract stipulating that a real or immovable
property be considered as personal or movable, a party is
estopped from subsequently claiming otherwise. Hence, such
property is a proper subject of a writ of replevin obtained by the
other contracting party.
The Case
Before us is a Petition for Review on Certiorari assailing the
January 6, 1999 Decision1 of the Court of Appeals (CA)2 in CAGR SP No. 47332 and its February 26, 1999
Resolution3 denying reconsideration. The decretal portion of
the CA Decision reads as follows:
"WHEREFORE, premises considered, the assailed Order
dated February 18, 1998 and Resolution dated March 31, 1998
in Civil Case No. Q-98-33500 are hereby AFFIRMED. The writ
of preliminary injunction issued on June 15, 1998 is
hereby LIFTED."4
In its February 18, 1998 Order,5 the Regional Trial Court (RTC)
of Quezon City (Branch 218)6 issued a Writ of Seizure.7 The
March 18, 1998 Resolution8 denied petitioners Motion for
Special Protective Order, praying that the deputy sheriff be
enjoined "from seizing immobilized or other real properties in
(petitioners) factory in Cainta, Rizal and to return to their
original place whatever immobilized machineries or
equipments he may have removed."9
The Facts
The undisputed facts are summarized by the Court of Appeals
as follows:10
"On February 13, 1998, respondent PCI Leasing and Finance,
Inc. ("PCI Leasing" for short) filed with the RTC-QC a
complaint for [a] sum of money (Annex E), with an application
for a writ of replevin docketed as Civil Case No. Q-98-33500.
"On March 6, 1998, upon an ex-parte application of PCI
Leasing, respondent judge issued a writ of replevin (Annex B)
directing its sheriff to seize and deliver the machineries and
equipment to PCI Leasing after 5 days and upon the payment
of the necessary expenses.
"On March 24, 1998, in implementation of said writ, the sheriff
proceeded to petitioners factory, seized one machinery with
[the] word that he [would] return for the other machineries.
"On March 25, 1998, petitioners filed a motion for special
protective order (Annex C), invoking the power of the court to
control the conduct of its officers and amend and control its
processes, praying for a directive for the sheriff to defer
enforcement of the writ of replevin.
"This motion was opposed by PCI Leasing (Annex F), on the
ground that the properties [were] still personal and therefore
still subject to seizure and a writ of replevin.
"In their Reply, petitioners asserted that the properties sought
to be seized [were] immovable as defined in Article 415 of the
Civil Code, the parties agreement to the contrary

notwithstanding. They argued that to give effect to the

agreement would be prejudicial to innocent third parties. They
further stated that PCI Leasing [was] estopped from treating
these machineries as personal because the contracts in which
the alleged agreement [were] embodied [were] totally sham
and farcical.
"On April 6, 1998, the sheriff again sought to enforce the writ of
seizure and take possession of the remaining properties. He
was able to take two more, but was prevented by the workers
from taking the rest.
"On April 7, 1998, they went to [the CA] via an original action
for certiorari."
Ruling of the Court of Appeals
Citing the Agreement of the parties, the appellate court held
that the subject machines were personal property, and that
they had only been leased, not owned, by petitioners. It also
ruled that the "words of the contract are clear and leave no
doubt upon the true intention of the contracting parties."
Observing that Petitioner Goquiolay was an experienced
businessman who was "not unfamiliar with the ways of the
trade," it ruled that he "should have realized the import of the
document he signed." The CA further held:
"Furthermore, to accord merit to this petition would be to
preempt the trial court in ruling upon the case below, since the
merits of the whole matter are laid down before us via a
petition whose sole purpose is to inquire upon the existence of
a grave abuse of discretion on the part of the [RTC] in issuing
the assailed Order and Resolution. The issues raised herein
are proper subjects of a full-blown trial, necessitating
presentation of evidence by both parties. The contract is being
enforced by one, and [its] validity is attacked by the other a
matter x x x which respondent court is in the best position to
determine."
Hence, this Petition.11
The Issues
In their Memorandum, petitioners submit the following issues
for our consideration:
"A. Whether or not the machineries purchased and imported by
SERGS became real property by virtue of immobilization.
B. Whether or not the contract between the parties is a loan or
a lease."12
In the main, the Court will resolve whether the said machines
are personal, not immovable, property which may be a proper
subject of a writ of replevin. As a preliminary matter, the Court
will also address briefly the procedural points raised by
respondent.
The Courts Ruling
The Petition is not meritorious.
Preliminary Matter:Procedural Questions
Respondent contends that the Petition failed to indicate
expressly whether it was being filed under Rule 45 or Rule 65
of the Rules of Court. It further alleges that the Petition
erroneously impleaded Judge Hilario Laqui as respondent.
There is no question that the present recourse is under Rule
45. This conclusion finds support in the very title of the Petition,
which is "Petition for Review on Certiorari."13

While Judge Laqui should not have been impleaded as a

respondent,14 substantial justice requires that such lapse by
itself should not warrant the dismissal of the present Petition.
In this light, the Court deems it proper to remove, motu proprio,
the name of Judge Laqui from the caption of the present case.

Applying Tumalad, the Court in Makati Leasing and Finance

Corp. v. Wearever Textile Mills20 also held that the machinery
used in a factory and essential to the industry, as in the present
case, was a proper subject of a writ of replevin because it was
treated as personal property in a contract. Pertinent portions of
the Courts ruling are reproduced hereunder:

Main Issue: Nature of the Subject Machinery

Petitioners contend that the subject machines used in their
factory were not proper subjects of the Writ issued by the RTC,
because they were in fact real property. Serious policy
considerations, they argue, militate against a contrary
characterization.
Rule 60 of the Rules of Court provides that writs of replevin are
issued for the recovery of personal property only.15 Section 3
thereof reads:
"SEC. 3. Order. -- Upon the filing of such affidavit and approval
of the bond, the court shall issue an order and the
corresponding writ of replevin describing the personal property
alleged to be wrongfully detained and requiring the sheriff
forthwith to take such property into his custody."
On the other hand, Article 415 of the Civil Code enumerates
immovable or real property as follows:
"ART. 415. The following are immovable property:
xxx

xxx

xxx

(5) Machinery, receptacles, instruments or implements

intended by the owner of the tenement for an industry or works
which may be carried on in a building or on a piece of land,
and which tend directly to meet the needs of the said industry
or works;
xxx

xxx

x x x"

In the present case, the machines that were the subjects of the
Writ of Seizure were placed by petitioners in the factory built on
their own land. Indisputably, they were essential and principal
elements of their chocolate-making industry. Hence, although
each of them was movable or personal property on its own, all
of them have become "immobilized by destination because
they are essential and principal elements in the industry."16 In
that sense, petitioners are correct in arguing that the said
machines are real, not personal, property pursuant to Article
415 (5) of the Civil Code.17

"x x x. If a house of strong materials, like what was involved in

the above Tumalad case, may be considered as personal
property for purposes of executing a chattel mortgage thereon
as long as the parties to the contract so agree and no innocent
third party will be prejudiced thereby, there is absolutely no
reason why a machinery, which is movable in its nature and
becomes immobilized only by destination or purpose, may not
be likewise treated as such. This is really because one who
has so agreed is estopped from denying the existence of the
chattel mortgage."
In the present case, the Lease Agreement clearly provides that
the machines in question are to be considered as personal
property. Specifically, Section 12.1 of the Agreement reads as
follows:21
"12.1 The PROPERTY is, and shall at all times be and remain,
personal property notwithstanding that the PROPERTY or any
part thereof may now be, or hereafter become, in any manner
affixed or attached to or embedded in, or permanently resting
upon, real property or any building thereon, or attached in any
manner to what is permanent."
Clearly then, petitioners are estopped from denying the
characterization of the subject machines as personal property.
Under the circumstances, they are proper subjects of the Writ
of Seizure.
It should be stressed, however, that our holding -- that the
machines should be deemed personal property pursuant to the
Lease Agreement is good only insofar as the contracting
parties are concerned.22 Hence, while the parties are bound by
the Agreement, third persons acting in good faith are not
affected by its stipulation characterizing the subject machinery
as personal.23 In any event, there is no showing that any
specific third party would be adversely affected.
Validity of the Lease Agreement

Be that as it may, we disagree with the submission of the

petitioners that the said machines are not proper subjects of
the Writ of Seizure.

In their Memorandum, petitioners contend that the Agreement

is a loan and not a lease.24 Submitting documents supposedly
showing that they own the subject machines, petitioners also
argue in their Petition that the Agreement suffers from "intrinsic
ambiguity which places in serious doubt the intention of the
parties and the validity of the lease agreement itself."25 In their
Reply to respondents Comment, they further allege that the
Agreement is invalid.26

The Court has held that contracting parties may validly

stipulate that a real property be considered as personal.18After
agreeing to such stipulation, they are consequently estopped
from claiming otherwise. Under the principle of estoppel, a
party to a contract is ordinarily precluded from denying the
truth of any material fact found therein.

These arguments are unconvincing. The validity and the nature

of the contract are the lis mota of the civil action pending
before the RTC. A resolution of these questions, therefore, is
effectively a resolution of the merits of the case. Hence, they
should be threshed out in the trial, not in the proceedings
involving the issuance of the Writ of Seizure.

Hence, in Tumalad v. Vicencio,19 the Court upheld the intention

of the parties to treat a house as a personal property because
it had been made the subject of a chattel mortgage. The Court
ruled:

Indeed, in La Tondea Distillers v. CA,27 the Court explained

that the policy under Rule 60 was that questions involving title
to the subject property questions which petitioners are now
raising -- should be determined in the trial. In that case, the
Court noted that the remedy of defendants under Rule 60 was
either to post a counter-bond or to question the sufficiency of
the plaintiffs bond. They were not allowed, however, to invoke
the title to the subject property. The Court ruled:

"x x x. Although there is no specific statement referring to the

subject house as personal property, yet by ceding, selling or
transferring a property by way of chattel mortgage defendantsappellants could only have meant to convey the house as
chattel, or at least, intended to treat the same as such, so that
they should not now be allowed to make an inconsistent stand
by claiming otherwise."

"In other words, the law does not allow the defendant to file a
motion to dissolve or discharge the writ of seizure (or delivery)
on ground of insufficiency of the complaint or of the grounds
relied upon therefor, as in proceedings on preliminary

attachment or injunction, and thereby put at issue the matter of

the title or right of possession over the specific chattel being
replevied, the policy apparently being that said matter should
be ventilated and determined only at the trial on the merits."28
Besides, these questions require a determination of facts and a
presentation of evidence, both of which have no place in a
petition for certiorari in the CA under Rule 65 or in a petition for
review in this Court under Rule 45.29
Reliance on the Lease Agreement
It should be pointed out that the Court in this case may rely on
the Lease Agreement, for nothing on record shows that it has
been nullified or annulled. In fact, petitioners assailed it first
only in the RTC proceedings, which had ironically been
instituted by respondent. Accordingly, it must be presumed
valid and binding as the law between the parties.

HEIRS OF MARIO MALABANAN, (Represented by Sally A.

Malabanan), Petitioners,
vs.
REPUBLIC OF THE PHILIPPINES, Respondent.
RESOLUTION
BERSAMIN, J.:
For our consideration and resolution are the motions for
reconsideration of the parties who both assail the decision
promulgated on April 29, 2009, whereby we upheld the ruling
of the Court of Appeals (CA) denying the application of the
petitioners for the registration of a parcel of land situated in
Barangay Tibig, Silang, Cavite on the ground that they had not
established by sufficient evidence their right to the registration
in accordance with either Section 14(1) or Section 14(2) of
Presidential Decree No. 1529 (Property Registration Decree).
Antecedents

Makati Leasing and Finance Corporation30 is also instructive on

this point. In that case, the Deed of Chattel Mortgage, which
characterized the subject machinery as personal property, was
also assailed because respondent had allegedly been required
"to sign a printed form of chattel mortgage which was in a
blank form at the time of signing." The Court rejected the
argument and relied on the Deed, ruling as follows:
"x x x. Moreover, even granting that the charge is true, such
fact alone does not render a contract void ab initio, but can
only be a ground for rendering said contract voidable, or
annullable pursuant to Article 1390 of the new Civil Code, by a
proper action in court. There is nothing on record to show that
the mortgage has been annulled. Neither is it disclosed that
steps were taken to nullify the same. x x x"
Alleged Injustice Committed on the Part of Petitioners
Petitioners contend that "if the Court allows these machineries
to be seized, then its workers would be out of work and thrown
into the streets."31 They also allege that the seizure would
nullify all efforts to rehabilitate the corporation.
Petitioners arguments do not preclude the implementation of
the Writ.1wphi1 As earlier discussed, law and jurisprudence
support its propriety. Verily, the above-mentioned
consequences, if they come true, should not be blamed on this
Court, but on the petitioners for failing to avail themselves of
the remedy under Section 5 of Rule 60, which allows the filing
of a counter-bond. The provision states:
"SEC. 5. Return of property. -- If the adverse party objects to
the sufficiency of the applicants bond, or of the surety or
sureties thereon, he cannot immediately require the return of
the property, but if he does not so object, he may, at any time
before the delivery of the property to the applicant, require the
return thereof, by filing with the court where the action is
pending a bond executed to the applicant, in double the value
of the property as stated in the applicants affidavit for the
delivery thereof to the applicant, if such delivery be adjudged,
and for the payment of such sum to him as may be recovered
against the adverse party, and by serving a copy bond on the
applicant."
WHEREFORE, the Petition is DENIED and the assailed
Decision of the Court of Appeals AFFIRMED. Costs against
petitioners.

To prove that the property was an alienable and disposable

land of the public domain, Malabanan presented during trial a
certification dated June 11, 2001 issued by the Community
Environment and Natural Resources Office (CENRO) of the
Department of Environment and Natural Resources (DENR),
which reads:
This is to certify that the parcel of land designated as Lot No.
9864 Cad 452-D, Silang Cadastre as surveyed for Mr. Virgilio
Velasco located at Barangay Tibig, Silang, Cavite containing
an area of 249,734 sq. meters as shown and described on the
Plan Ap-04-00952 is verified to be within the Alienable or
Disposable land per Land Classification Map No. 3013
established under Project No. 20-A and approved as such
under FAO 4-1656 on March 15, 1982.2
After trial, on December 3, 2002, the RTC rendered judgment
granting Malabanans application for land registration,
disposing thusly:
WHEREFORE, this Court hereby approves this application for
registration and thus places under the operation of Act 141, Act
496 and/or P.D. 1529, otherwise known as Property
Registration Law, the lands described in Plan Csd-040173123-D, Lot 9864-A and containing an area of Seventy One
Thousand Three Hundred Twenty Four (71,324) Square
Meters, as supported by its technical description now forming
part of the record of this case, in addition to other proofs
adduced in the name of MARIO MALABANAN, who is of legal
age, Filipino, widower, and with residence at Munting Ilog,
Silang, Cavite.
Once this Decision becomes final and executory, the
corresponding decree of registration shall forthwith issue.
SO ORDERED.3

SO ORDERED.

G.R. No. 179987

The property subject of the application for registration is a

parcel of land situated in Barangay Tibig, Silang Cavite, more
particularly identified as Lot 9864-A, Cad-452-D, with an area
of 71,324-square meters. On February 20, 1998, applicant
Mario Malabanan, who had purchased the property from
Eduardo Velazco, filed an application for land registration
covering the property in the Regional Trial Court (RTC) in
Tagaytay City, Cavite, claiming that the property formed part of
the alienable and disposable land of the public domain, and
that he and his predecessors-in-interest had been in open,
continuous, uninterrupted, public and adverse possession and
occupation of the land for more than 30 years, thereby entitling
him to the judicial confirmation of his title.1

September 3, 2013

The Office of the Solicitor General (OSG) appealed the

judgment to the CA, arguing that Malabanan had failed to
prove that the property belonged to the alienable and
disposable land of the public domain, and that the RTC erred
in finding that he had been in possession of the property in the
manner and for the length of time required by law for
confirmation of imperfect title.

On February 23, 2007, the CA promulgated its decision

reversing the RTC and dismissing the application for
registration of Malabanan. Citing the ruling in Republic v.
Herbieto (Herbieto),4 the CA declared that under Section 14(1)
of the Property Registration Decree, any period of possession
prior to the classification of the land as alienable and
disposable was inconsequential and should be excluded from
the computation of the period of possession. Noting that the
CENRO-DENR certification stated that the property had been
declared alienable and disposable only on March 15, 1982,
Velazcos possession prior to March 15, 1982 could not be
tacked for purposes of computing Malabanans period of
possession.
Due to Malabanans intervening demise during the appeal in
the CA, his heirs elevated the CAs decision of February 23,
2007 to this Court through a petition for review on certiorari.

Chiefly citing the dissents, the Republic contends that the

decision has enlarged, by implication, the interpretation of
Section 14(1) of the Property Registration Decree through
judicial legislation. It reiterates its view that an applicant is
entitled to registration only when the land subject of the
application had been declared alienable and disposable since
June 12, 1945 or earlier.
Ruling
We deny the motions for reconsideration.
In reviewing the assailed decision, we consider to be
imperative to discuss the different classifications of land in
relation to the existing applicable land registration laws of the
Philippines.

The petitioners assert that the ruling in Republic v. Court of

Appeals and Corazon Naguit5 (Naguit) remains the controlling
doctrine especially if the property involved is agricultural land.
In this regard, Naguit ruled that any possession of agricultural
land prior to its declaration as alienable and disposable could
be counted in the reckoning of the period of possession to
perfect title under the Public Land Act (Commonwealth Act No.
141) and the Property Registration Decree. They point out that
the ruling in Herbieto, to the effect that the declaration of the
land subject of the application for registration as alienable and
disposable should also date back to June 12, 1945 or earlier,
was a mere obiter dictum considering that the land registration
proceedings therein were in fact found and declared void ab
initio for lack of publication of the notice of initial hearing.

Classifications of land according to ownership

The petitioners also rely on the ruling in Republic v. T.A.N.

Properties, Inc.6 to support their argument that the property
had been ipso jure converted into private property by reason of
the open, continuous, exclusive and notorious possession by
their predecessors-in-interest of an alienable land of the public
domain for more than 30 years. According to them, what was
essential was that the property had been "converted" into
private property through prescription at the time of the
application without regard to whether the property sought to be
registered was previously classified as agricultural land of the
public domain.

Pursuant to the Regalian Doctrine (Jura Regalia), a legal

concept first introduced into the country from the West by
Spain through the Laws of the Indies and the Royal
Cedulas,14 all lands of the public domain belong to the
State.15 This means that the State is the source of any asserted
right to ownership of land, and is charged with the conservation
of such patrimony.16

As earlier stated, we denied the petition for review on certiorari

because Malabanan failed to establish by sufficient evidence
possession and occupation of the property on his part and on
the part of his predecessors-in interest since June 12, 1945, or
earlier.
Petitioners Motion for Reconsideration
In their motion for reconsideration, the petitioners submit that
the mere classification of the land as alienable or disposable
should be deemed sufficient to convert it into patrimonial
property of the State. Relying on the rulings in Spouses De
Ocampo v. Arlos,7 Menguito v. Republic8 and Republic v. T.A.N.
Properties, Inc.,9 they argue that the reclassification of the land
as alienable or disposable opened it to acquisitive prescription
under the Civil Code; that Malabanan had purchased the
property from Eduardo Velazco believing in good faith that
Velazco and his predecessors-in-interest had been the real
owners of the land with the right to validly transmit title and
ownership thereof; that consequently, the ten-year period
prescribed by Article 1134 of the Civil Code, in relation to
Section 14(2) of the Property Registration Decree, applied in
their favor; and that when Malabanan filed the application for
registration on February 20, 1998, he had already been in
possession of the land for almost 16 years reckoned from
1982, the time when the land was declared alienable and
disposable by the State.
The Republics Motion for Partial Reconsideration
The Republic seeks the partial reconsideration in order to
obtain a clarification with reference to the application of the
rulings in Naguit and Herbieto.

Land, which is an immovable property,10 may be classified as

either of public dominion or of private ownership.11Land is
considered of public dominion if it either: (a) is intended for
public use; or (b) belongs to the State, without being for public
use, and is intended for some public service or for the
development of the national wealth.12 Land belonging to the
State that is not of such character, or although of such
character but no longer intended for public use or for public
service forms part of the patrimonial property of the
State.13 Land that is other than part of the patrimonial property
of the State, provinces, cities and municipalities is of private
ownership if it belongs to a private individual.

All lands not appearing to be clearly under private ownership

are presumed to belong to the State. Also, public lands remain
part of the inalienable land of the public domain unless the
State is shown to have reclassified or alienated them to private
persons.17
Classifications of public lands
according to alienability
Whether or not land of the public domain is alienable and
disposable primarily rests on the classification of public lands
made under the Constitution. Under the 1935
Constitution,18 lands of the public domain were classified into
three, namely, agricultural, timber and mineral.19 Section 10,
Article XIV of the 1973 Constitution classified lands of the
public domain into seven, specifically, agricultural, industrial or
commercial, residential, resettlement, mineral, timber or forest,
and grazing land, with the reservation that the law might
provide other classifications. The 1987 Constitution adopted
the classification under the 1935 Constitution into agricultural,
forest or timber, and mineral, but added national
parks.20 Agricultural lands may be further classified by law
according to the uses to which they may be devoted.21 The
identification of lands according to their legal classification is
done exclusively by and through a positive act of the Executive
Department.22
Based on the foregoing, the Constitution places a limit on the
type of public land that may be alienated. Under Section 2,
Article XII of the 1987 Constitution, only agricultural lands of
the public domain may be alienated; all other natural resources
may not be.
Alienable and disposable lands of the State fall into two
categories, to wit: (a) patrimonial lands of the State, or those
classified as lands of private ownership under Article 425 of the
Civil Code,23 without limitation; and (b) lands of the public
domain, or the public lands as provided by the Constitution, but
with the limitation that the lands must only be agricultural.

Consequently, lands classified as forest or timber, mineral, or

national parks are not susceptible of alienation or disposition
unless they are reclassified as agricultural.24 A positive act of
the Government is necessary to enable such
reclassification,25 and the exclusive prerogative to classify
public lands under existing laws is vested in the Executive
Department, not in the courts.26 If, however, public land will be
classified as neither agricultural, forest or timber, mineral or
national park, or when public land is no longer intended for
public service or for the development of the national wealth,
thereby effectively removing the land from the ambit of public
dominion, a declaration of such conversion must be made in
the form of a law duly enacted by Congress or by a
Presidential proclamation in cases where the President is duly
authorized by law to that effect.27 Thus, until the Executive
Department exercises its prerogative to classify or reclassify
lands, or until Congress or the President declares that the
State no longer intends the land to be used for public service
or for the development of national wealth, the Regalian
Doctrine is applicable.
Disposition of alienable public lands
Section 11 of the Public Land Act (CA No. 141) provides the
manner by which alienable and disposable lands of the public
domain, i.e., agricultural lands, can be disposed of, to wit:
Section 11. Public lands suitable for agricultural purposes can
be disposed of only as follows, and not otherwise:
(1) For homestead settlement;
(2) By sale;
(3) By lease; and
(4) By confirmation of imperfect or incomplete titles;
(a) By judicial legalization; or
(b) By administrative legalization (free
patent).
The core of the controversy herein lies in the proper
interpretation of Section 11(4), in relation to Section 48(b) of
the Public Land Act, which expressly requires possession by a
Filipino citizen of the land since June 12, 1945, or earlier, viz:
Section 48. The following-described citizens of the Philippines,
occupying lands of the public domain or claiming to own any
such lands or an interest therein, but whose titles have not
been perfected or completed, may apply to the Court of First
Instance of the province where the land is located for
confirmation of their claims and the issuance of a certificate of
title thereafter, under the Land Registration Act, to wit:
xxxx
(b) Those who by themselves or through their predecessors-ininterest have been in open, continuous, exclusive, and
notorious possession and occupation of alienable and
disposable lands of the public domain, under a bona fide claim
of acquisition of ownership, since June 12, 1945, or earlier,
immediately preceding the filing of the applications for
confirmation of title, except when prevented by war or force
majeure. These shall be conclusively presumed to have
performed all the conditions essential to a Government grant
and shall be entitled to a certificate of title under the provisions
of this chapter. (Bold emphasis supplied)
Note that Section 48(b) of the Public Land Act used the words
"lands of the public domain" or "alienable and disposable lands
of the public domain" to clearly signify that lands otherwise
classified, i.e., mineral, forest or timber, or national parks, and
lands of patrimonial or private ownership, are outside the
coverage of the Public Land Act. What the law does not
include, it excludes. The use of the descriptive phrase
"alienable and disposable" further limits the coverage of

Section 48(b) to only the agricultural lands of the public domain

as set forth in Article XII, Section 2 of the 1987 Constitution.
Bearing in mind such limitations under the Public Land Act, the
applicant must satisfy the following requirements in order for
his application to come under Section 14(1) of the Property
Registration Decree,28 to wit:
1. The applicant, by himself or through his
predecessor-in-interest, has been in possession and
occupation of the property subject of the application;
2. The possession and occupation must be open,
continuous, exclusive, and notorious;
3. The possession and occupation must be under a
bona fide claim of acquisition of ownership;
4. The possession and occupation must have taken
place since June 12, 1945, or earlier; and
5. The property subject of the application must be an
agricultural land of the public domain.
Taking into consideration that the Executive Department is
vested with the authority to classify lands of the public domain,
Section 48(b) of the Public Land Act, in relation to Section
14(1) of the Property Registration Decree, presupposes that
the land subject of the application for registration must have
been already classified as agricultural land of the public
domain in order for the provision to apply. Thus, absent proof
that the land is already classified as agricultural land of the
public domain, the Regalian Doctrine applies, and overcomes
the presumption that the land is alienable and disposable as
laid down in Section 48(b) of the Public Land Act. However,
emphasis is placed on the requirement that the classification
required by Section 48(b) of the Public Land Act is
classification or reclassification of a public land as agricultural.
The dissent stresses that the classification or reclassification of
the land as alienable and disposable agricultural land should
likewise have been made on June 12, 1945 or earlier, because
any possession of the land prior to such classification or
reclassification produced no legal effects. It observes that the
fixed date of June 12, 1945 could not be minimized or glossed
over by mere judicial interpretation or by judicial social policy
concerns, and insisted that the full legislative intent be
respected.
We find, however, that the choice of June 12, 1945 as the
reckoning point of the requisite possession and occupation
was the sole prerogative of Congress, the determination of
which should best be left to the wisdom of the lawmakers.
Except that said date qualified the period of possession and
occupation, no other legislative intent appears to be associated
with the fixing of the date of June 12, 1945. Accordingly, the
Court should interpret only the plain and literal meaning of the
law as written by the legislators.
Moreover, an examination of Section 48(b) of the Public Land
Act indicates that Congress prescribed no requirement that the
land subject of the registration should have been classified as
agricultural since June 12, 1945, or earlier. As such, the
applicants imperfect or incomplete title is derived only from
possession and occupation since June 12, 1945, or earlier.
This means that the character of the property subject of the
application as alienable and disposable agricultural land of the
public domain determines its eligibility for land registration, not
the ownership or title over it.
Alienable public land held by a possessor, either personally or
through his predecessors-in-interest, openly, continuously and
exclusively during the prescribed statutory period is converted
to private property by the mere lapse or completion of the
period.29 In fact, by virtue of this doctrine, corporations may
now acquire lands of the public domain for as long as the lands
were already converted to private ownership, by operation of
law, as a result of satisfying the requisite period of possession
prescribed by the Public Land Act.30 It is for this reason that the
property subject of the application of Malabanan need not be

classified as alienable and disposable agricultural land of the

public domain for the entire duration of the requisite period of
possession.

(b) Lands of the public domain subsequently

classified or declared as no longer intended
for public use or for the development of
national wealth are removed from the sphere
of public dominion and are considered
converted into patrimonial lands or lands of
private ownership that may be alienated or
disposed through any of the modes of
acquiring ownership under the Civil Code. If
the mode of acquisition is prescription,
whether ordinary or extraordinary, proof that
the land has been already converted to
private ownership prior to the requisite
acquisitive prescriptive period is a condition
sine qua non in observance of the law
(Article 1113, Civil Code) that property of the
State not patrimonial in character shall not
be the object of prescription.

To be clear, then, the requirement that the land should have

been classified as alienable and disposable agricultural land at
the time of the application for registration is necessary only to
dispute the presumption that the land is inalienable.
The declaration that land is alienable and disposable also
serves to determine the point at which prescription may run
against the State. The imperfect or incomplete title being
confirmed under Section 48(b) of the Public Land Act is title
that is acquired by reason of the applicants possession and
occupation of the alienable and disposable agricultural land of
the public domain. Where all the necessary requirements for a
grant by the Government are complied with through actual
physical, open, continuous, exclusive and public possession of
an alienable and disposable land of the public domain, the
possessor is deemed to have acquired by operation of law not
only a right to a grant, but a grant by the Government, because
it is not necessary that a certificate of title be issued in order
that such a grant be sanctioned by the courts.31
If one follows the dissent, the clear objective of the Public Land
Act to adjudicate and quiet titles to unregistered lands in favor
of qualified Filipino citizens by reason of their occupation and
cultivation thereof for the number of years prescribed by
law32 will be defeated. Indeed, we should always bear in mind
that such objective still prevails, as a fairly recent legislative
development bears out, when Congress enacted legislation
(Republic Act No. 10023)33 in order to liberalize stringent
requirements and procedures in the adjudication of alienable
public land to qualified applicants, particularly residential lands,
subject to area limitations.34
On the other hand, if a public land is classified as no longer
intended for public use or for the development of national
wealth by declaration of Congress or the President, thereby
converting such land into patrimonial or private land of the
State, the applicable provision concerning disposition and
registration is no longer Section 48(b) of the Public Land Act
but the Civil Code, in conjunction with Section 14(2) of the
Property Registration Decree.35 As such, prescription can now
run against the State.
To sum up, we now observe the following rules relative to the
disposition of public land or lands of the public domain,
namely:
(1) As a general rule and pursuant to the Regalian
Doctrine, all lands of the public domain belong to the
State and are inalienable. Lands that are not clearly
under private ownership are also presumed to belong
to the State and, therefore, may not be alienated or
disposed;
(2) The following are excepted from the general rule,
to wit:
(a) Agricultural lands of the public domain
are rendered alienable and disposable
through any of the exclusive modes
enumerated under Section 11 of the Public
Land Act. If the mode is judicial confirmation
of imperfect title under Section 48(b) of the
Public Land Act, the agricultural land subject
of the application needs only to be classified
as alienable and disposable as of the time of
the application, provided the applicants
possession and occupation of the land dated
back to June 12, 1945, or earlier. Thereby, a
conclusive presumption that the applicant
has performed all the conditions essential to
a government grant arises,36 and the
applicant becomes the owner of the land by
virtue of an imperfect or incomplete title. By
legal fiction, the land has already ceased to
be part of the public domain and has
become private property.37

To reiterate, then, the petitioners failed to present sufficient

evidence to establish that they and their predecessors-ininterest had been in possession of the land since June 12,
1945. Without satisfying the requisite character and period of
possession - possession and occupation that is open,
continuous, exclusive, and notorious since June 12, 1945, or
earlier - the land cannot be considered ipso jure converted to
private property even upon the subsequent declaration of it as
alienable and disposable. Prescription never began to run
against the State, such that the land has remained ineligible for
registration under Section 14(1) of the Property Registration
Decree. Likewise, the land continues to be ineligible for land
registration under Section 14(2) of the Property Registration
Decree unless Congress enacts a law or the President issues
a proclamation declaring the land as no longer intended for
public service or for the development of the national
wealth.1wphi1
WHEREFORE, the Court DENIES the petitioners' Motion for
Reconsideration and the respondent's Partial Motion for
Reconsideration for their lack of merit.
SO ORDERED.

G.R. No. L-24440

June 30, 1969

THE PROVINCE OF ZAMBOANGA DEL NORTE, plaintiffappellee,

vs.
CITY OF ZAMBOANGA, SECRETARY OF FINANCE AND
COMMISSIONER OF INTERNAL REVENUE,defendantsappellants.
RESOLUTION
REYES, J.B.L., J.:
Professing respect for the principles enunciated by this Court
in its decision of 28 March 1968, in Case G. R. No. L-24440,
entitled Province of Zamboanga del Norte vs. City of
Zamboanga, et al., 1 the appellant City seeks reconsideration of
our decision in so far as the latter declares that Republic Act
3039 is unconstitutional and void in so far as the same seeks
to deprive the Province of Zamboanga del Norte of its share in
the 26 lots situated within the City of Zamboanga, and
hereinafter enumerated, without just compensation, for the
reason that said 26 lots are patrimonial property of the old
Province of Zamboanga. Said 26 lots are declared in the main
decision to be the following:
TCT Number
5577

..........................

13198 .........................
5569
5558
5559

..........................
..........................
..........................

Lot Number
177
127D
169
175
188

..........................
..........................
..........................
..........................
..........................

Use
Mydro,
Magay
San
Roque
Burleigh2
Vacant
"

5560
5561
5563
5566
5568
5574
5575
5576
5578
5579
5580
5581
5582
5584
5588
5589
5590
5591
5592
5593
7379

..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................
..........................

183 ..........................
186 ..........................
191 ..........................
176 ..........................
179 ..........................
196 ..........................
181-A .......................
181-B .......................
182 ..........................
197 ..........................
195 ..........................
159-B .........................
194 ..........................
190 ..........................
184 ..........................
187 ..........................
189 ..........................
192 ..........................
193 ..........................
185 ..........................
4147 ..........................

The movant City contends that the 26 lots aforestated were not
patrimonial property of the former Province of Zamboanga, for
the reason that said 26 lots have always been used for public
purposes, such as school sites, playgrounds and athletic fields
for schools.
To bolster its contention, the City of Zamboanga submitted
photographs, plans and a sworn certification of its City
Engineer to the effect that:
(a) Twenty-one lots (Nos. 17, 177, 179, 181-A, 181-B,
182 to 197) are part and parcel of the Zamboanga
Trade School;
(b) Three lots (Nos. 169, 175 and 176) are part and
parcel of the Zamboanga Normal College;
(c) Lot No. 127-D is the Pasonanca Elementary
School;
(d) Lot No. 4147 is the Bolong Elementary School;
(e) Lot No. 159-B is part and parcel of the Baliwasan
Elementary School.
Appellant City of Zamboanga, therefore, prays that the main
decision be partly reconsidered and that all title to, and
ownership of, the 26 lots be declared to have been validly
vested in said City free of charge by Republic Act No. 3039.
The motion for reconsideration is vigorously opposed by
plaintiff-appellee Province of Zamboanga del Norte, which
contends that the evidence sought to be filed by the appellant
City is not newly discovered evidence and is, therefore,
inadmissible at this stage of the proceedings. Alternatively, the
appellee Province of Zamboanga contends that the 26 lots are
vacant, or that the buildings existing thereon were constructed
in bad faith; and that the said Province has additional evidence
to show that most of these properties are not actually devoted
to public use or governmental purposes.1awphil.nt
Considering that both contending parties are actually
subdivisions of one entity, the Republic of the Philippines, so
that public interest is involved and demands that the issues
presented be determined speedily without regard to
technicalities, the Court resolved that, in the interest of justice
and equity, its main decision and that of the court below be
reconsidered and set aside, in so far as they affect the twentysix lots heretofore enumerated, and the monetary indemnities
awarded. Instead, the records are ordered remanded to the
court of origin for a new trial, wherein the parties shall be given
opportunity to adduce and submit any evidence in their
possession to show whether or not the 26 lots aforesaid were
or were not actually devoted to public use or governmental

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"
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"
"
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purposes prior to the enactment of Republic Act No. 3039.

Thereafter, the Court of First Instance shall decide the issues
anew, taking into account the evidence submitted by the
parties and the principles of law laid down by this Supreme
Court in its main decision of the present case, dated 28 March
1968.
So ordered. No costs.

G.R. No. 97764 August 10, 1992

LEVY D. MACASIANO, Brigadier General/PNP
Superintendent, Metropolitan Traffic Command, petitioner,
vs.
HONORABLE ROBERTO C. DIOKNO, Presiding Judge,
Branch 62, Regional Trial Court of Makati, Metro Manila,
MUNICIPALITY OF PARAAQUE, METRO MANILA,
PALANYAG KILUSANG BAYAN FOR SERVICE,respondents.
Ceferino, Padua Law Office for Palanyag Kilusang Bayan for
service.
Manuel de Guia for Municipality of Paraaque.

MEDIALDEA, J.:
This is a petition for certiorari under Rule 65 of the Rules of
Court seeking the annulment of the decision of the Regional
Trial Court of Makati, Branch 62, which granted the writ of
preliminary injunction applied for by respondents Municipality
of Paraaque and Palanyag Kilusang Bayan for Service
(Palanyag for brevity) against petitioner herein.
The antecedent facts are as follows:
On June 13, 1990, the respondent municipality passed
Ordinance No. 86, Series of 1990 which authorized the closure
of J. Gabriel, G.G. Cruz, Bayanihan, Lt. Garcia Extension and
Opena Streets located at Baclaran, Paraaque, Metro Manila
and the establishment of a flea market thereon. The said
ordinance was approved by the municipal council pursuant to
MMC Ordinance No. 2, Series of 1979, authorizing and
regulating the use of certain city and/or municipal streets,
roads and open spaces within Metropolitan Manila as sites for
flea market and/or vending areas, under certain terms and
conditions.
On July 20, 1990, the Metropolitan Manila Authority approved
Ordinance No. 86, s. 1990 of the municipal council of
respondent municipality subject to the following conditions:
1. That the aforenamed streets are not used
for vehicular traffic, and that the majority of
the residents do not oppose the
establishment of the flea market/vending
areas thereon;
2. That the 2-meter middle road to be used
as flea market/vending area shall be marked
distinctly, and that the 2 meters on both
sides of the road shall be used by
pedestrians;
3. That the time during which the vending
area is to be used shall be clearly
designated;
4. That the use of the vending areas shall be
temporary and shall be closed once the

reclaimed areas are developed and donated

by the Public Estate Authority.
On June 20, 1990, the municipal council of Paraaque issued
a resolution authorizing Paraaque Mayor Walfrido N. Ferrer to
enter into contract with any service cooperative for the
establishment, operation, maintenance and management of
flea markets and/or vending areas.
On August 8, 1990, respondent municipality and respondent
Palanyag, a service cooperative, entered into an agreement
whereby the latter shall operate, maintain and manage the flea
market in the aforementioned streets with the obligation to
remit dues to the treasury of the municipal government of
Paraaque. Consequently, market stalls were put up by
respondent Palanyag on the said streets.
On September 13, 1990, petitioner Brig. Gen. Macasiano, PNP
Superintendent of the Metropolitan Traffic Command, ordered
the destruction and confiscation of stalls along G.G. Cruz and
J. Gabriel St. in Baclaran. These stalls were later returned to
respondent Palanyag.
On October 16, 1990, petitioner Brig. General Macasiano
wrote a letter to respondent Palanyag giving the latter ten (10)
days to discontinue the flea market; otherwise, the market
stalls shall be dismantled.
Hence, on October 23, 1990, respondents municipality and
Palanyag filed with the trial court a joint petition for prohibition
and mandamus with damages and prayer for preliminary
injunction, to which the petitioner filed his
memorandum/opposition to the issuance of the writ of
preliminary injunction.
On October 24, 1990, the trial court issued a temporary
restraining order to enjoin petitioner from enforcing his letterorder of October 16, 1990 pending the hearing on the motion
for writ of preliminary injunction.
On December 17, 1990, the trial court issued an order
upholding the validity of Ordinance No. 86 s. 1990 of the
Municipality' of Paraaque and enjoining petitioner Brig. Gen.
Macasiano from enforcing his letter-order against respondent
Palanyag.
Hence, this petition was filed by the petitioner thru the Office of
the Solicitor General alleging grave abuse of discretion
tantamount to lack or excess of jurisdiction on the part of the
trial judge in issuing the assailed order.
The sole issue to be resolved in this case is whether or not an
ordinance or resolution issued by the municipal council of
Paraaque authorizing the lease and use of public streets or
thoroughfares as sites for flea markets is valid.
The Solicitor General, in behalf of petitioner, contends that
municipal roads are used for public service and are therefore
public properties; that as such, they cannot be subject to
private appropriation or private contract by any person, even
by the respondent Municipality of Paraaque. Petitioner
submits that a property already dedicated to public use cannot
be used for another public purpose and that absent a clear
showing that the Municipality of Paraaque has been granted
by the legislature specific authority to convert a property
already in public use to another public use, respondent
municipality is, therefore, bereft of any authority to close
municipal roads for the establishment of a flea market.
Petitioner also submits that assuming that the respondent
municipality is authorized to close streets, it failed to comply
with the conditions set forth by the Metropolitan Manila
Authority for the approval of the ordinance providing for the
establishment of flea markets on public streets. Lastly,
petitioner contends that by allowing the municipal streets to be
used by market vendors the municipal council of respondent

municipality violated its duty under the Local Government

Code to promote the general welfare of the residents of the
municipality.
In upholding the legality of the disputed ordinance, the trial
court ruled:
. . . that Chanter II Section 10 of the Local
Government Code is a statutory grant of
power given to local government units, the
Municipality of Paraaque as such, is
empowered under that law to close its roads,
streets or alley subject to limitations stated
therein (i.e., that it is in accordance with
existing laws and the provisions of this
code).
xxx xxx xxx
The actuation of the respondent Brig. Gen.
Levi Macasiano, though apparently within its
power is in fact an encroachment of power
legally vested to the municipality, precisely
because when the municipality enacted the
ordinance in question the authority of the
respondent as Police Superintendent ceases
to be operative on the ground that the streets
covered by the ordinance ceases to be a
public thoroughfare. (pp. 33-34, Rollo)
We find the petition meritorious. In resolving the question of
whether the disputed municipal ordinance authorizing the flea
market on the public streets is valid, it is necessary to examine
the laws in force during the time the said ordinance was
enacted, namely, Batas Pambansa Blg. 337, otherwise known
as Local Government Code, in connection with established
principles embodied in the Civil Code an property and settled
jurisprudence on the matter.
The property of provinces, cities and municipalities is divided
into property for public use and patrimonial property (Art. 423,
Civil Code). As to what consists of property for public use,
Article 424 of Civil Code states:
Art. 424. Property for public use, in the
provinces, cities and municipalities, consists
of the provincial roads, city streets, the
squares, fountains, public waters,
promenades, and public works for public
service paid for by said provinces, cities or
municipalities.
All other property possessed by any of them
is patrimonial and shall be governed by this
Code, without prejudice to the provisions of
special laws.
Based on the foregoing, J. Gabriel G.G. Cruz, Bayanihan, Lt.
Garcia Extension and Opena streets are local roads used for
public service and are therefore considered public properties of
respondent municipality. Properties of the local government
which are devoted to public service are deemed public and are
under the absolute control of Congress (Province of
Zamboanga del Norte v. City of Zamboanga, L-24440, March
28, 1968, 22 SCRA 1334). Hence, local governments have no
authority whatsoever to control or regulate the use of public
properties unless specific authority is vested upon them by
Congress. One such example of this authority given by
Congress to the local governments is the power to close roads
as provided in Section 10, Chapter II of the Local Government
Code, which states:
Sec. 10. Closure of roads. A local
government unit may likewise, through its
head acting pursuant to a resolution of its

sangguniang and in accordance with

existing law and the provisions of this Code,
close any barangay, municipal, city or
provincial road, street, alley, park or
square. No such way or place or any part of
thereof shall be close without indemnifying
any person prejudiced thereby. A property
thus withdrawn from public use may be used
or conveyed for any purpose for which other
real property belonging to the local unit
concerned might be lawfully used or
conveyed. (Emphasis ours).
However, the aforestated legal provision which gives authority
to local government units to close roads and other similar
public places should be read and interpreted in accordance
with basic principles already established by law. These basic
principles have the effect of limiting such authority of the
province, city or municipality to close a public street or
thoroughfare. Article 424 of the Civil Code lays down the basic
principle that properties of public dominion devoted to public
use and made available to the public in general are outside the
commerce of man and cannot be disposed of or leased by the
local government unit to private persons. Aside from the
requirement of due process which should be complied with
before closing a road, street or park, the closure should be for
the sole purpose of withdrawing the road or other public
property from public use when circumstances show that such
property is no longer intended or necessary for public use or
public service. When it is already withdrawn from public use,
the property then becomes patrimonial property of the local
government unit concerned (Article 422, Civil Code; Cebu
Oxygen, etc. et al. v. Bercilles, et al., G.R. No. L-40474, August
29, 1975, 66 SCRA 481). It is only then that the respondent
municipality can "use or convey them for any purpose for which
other real property belonging to the local unit concerned might
be lawfully used or conveyed" in accordance with the last
sentence of Section 10, Chapter II of Blg. 337, known as Local
Government Code. In one case, the City Council of Cebu,
through a resolution, declared the terminal road of M. Borces
Street, Mabolo, Cebu City as an abandoned road, the same
not being included in the City Development Plan. Thereafter,
the City Council passes another resolution authorizing the sale
of the said abandoned road through public bidding. We held
therein that the City of Cebu is empowered to close a city
street and to vacate or withdraw the same from public use.
Such withdrawn portion becomes patrimonial property which
can be the object of an ordinary contract (Cebu Oxygen and
Acetylene Co., Inc. v. Bercilles, et al., G.R. No.
L-40474, August 29, 1975, 66 SCRA 481). However, those
roads and streets which are available to the public in general
and ordinarily used for vehicular traffic are still considered
public property devoted to public use. In such case, the local
government has no power to use it for another purpose or to
dispose of or lease it to private persons. This limitation on the
authority of the local government over public properties has
been discussed and settled by this Court en banc in "Francisco
V. Dacanay, petitioner v. Mayor Macaria Asistio, Jr., et al.,
respondents, G.R. No. 93654, May 6, 1992." This Court ruled:
There is no doubt that the disputed areas
from which the private respondents' market
stalls are sought to be evicted are public
streets, as found by the trial court in Civil
Case No. C-12921. A public street is
property for public use hence outside the
commerce of man (Arts. 420, 424, Civil
Code). Being outside the commerce of man,
it may not be the subject of lease or others
contract (Villanueva, et al. v. Castaeda and
Macalino, 15 SCRA 142 citing the
Municipality of Cavite v. Rojas, 30 SCRA
602; Espiritu v. Municipal Council of
Pozorrubio, 102 Phil. 869; And Muyot v. De
la Fuente, 48 O.G. 4860).

As the stallholders pay fees to the City

Government for the right to occupy portions
of the public street, the City Government,
contrary to law, has been leasing portions of
the streets to them. Such leases or licenses
are null and void for being contrary to law.
The right of the public to use the city streets
may not be bargained away through
contract. The interests of a few should not
prevail over the good of the greater number
in the community whose health, peace,
safety, good order and general welfare, the
respondent city officials are under legal
obligation to protect.
The Executive Order issued by acting Mayor
Robles authorizing the use of Heroes del '96
Street as a vending area for stallholders who
were granted licenses by the city
government contravenes the general law
that reserves city streets and roads for public
use. Mayor Robles' Executive Order may not
infringe upon the vested right of the public to
use city streets for the purpose they were
intended to serve: i.e., as arteries of travel
for vehicles and pedestrians.
Even assuming, in gratia argumenti, that respondent
municipality has the authority to pass the disputed ordinance,
the same cannot be validly implemented because it cannot be
considered approved by the Metropolitan Manila Authority due
to non-compliance by respondent municipality of the conditions
imposed by the former for the approval of the ordinance, to wit:
1. That the aforenamed streets are not used
for vehicular traffic, and that the majority of
the residents do(es) not oppose the
establishment of the flea market/vending
areas thereon;
2. That the 2-meter middle road to be used
as flea market/vending area shall be marked
distinctly, and that the 2 meters on both
sides of the road shall be used by
pedestrians;
3. That the time during which the vending
area is to be used shall be clearly
designated;
4. That the use of the vending areas shall be
temporary and shall be closed once the
reclaimed areas are developed and donated
by the Public Estate Authority. (p. 38, Rollo)
Respondent municipality has not shown any iota of proof that it
has complied with the foregoing conditions precedent to the
approval of the ordinance. The allegations of respondent
municipality that the closed streets were not used for vehicular
traffic and that the majority of the residents do not oppose the
establishment of a flea market on said streets are unsupported
by any evidence that will show that this first condition has been
met. Likewise, the designation by respondents of a time
schedule during which the flea market shall operate is absent.
Further, it is of public notice that the streets along Baclaran
area are congested with people, houses and traffic brought
about by the proliferation of vendors occupying the streets. To
license and allow the establishment of a flea market along J.
Gabriel, G.G. Cruz, Bayanihan, Lt. Garcia Extension and
Opena streets in Baclaran would not help in solving the
problem of congestion. We take note of the other observations
of the Solicitor General when he said:

. . . There have been many instances of

emergencies and fires where ambulances
and fire engines, instead of using the roads
for a more direct access to the fire area,
have to maneuver and look for other streets
which are not occupied by stalls and vendors
thereby losing valuable time which could,
otherwise, have been spent in saving
properties and lives.

such powers should be subservient to paramount

considerations of health and well-being of the members of the
community. Every local government unit has the sworn
obligation to enact measures that will enhance the public
health, safety and convenience, maintain peace and order, and
promote the general prosperity of the inhabitants of the local
units. Based on this objective, the local government should
refrain from acting towards that which might prejudice or
adversely affect the general welfare.

Along G.G. Cruz Street is a hospital, the St.

Rita Hospital. However, its ambulances and
the people rushing their patients to the
hospital cannot pass through G.G. Cruz
because of the stalls and the vendors. One
can only imagine the tragedy of losing a life
just because of a few seconds delay brought
about by the inaccessibility of the streets
leading to the hospital.

As what we have said in the Dacanay case, the general public

have a legal right to demand the demolition of the illegally
constructed stalls in public roads and streets and the officials
of respondent municipality have the corresponding duty arising
from public office to clear the city streets and restore them to
their specific public purpose.

The children, too, suffer. In view of the

occupancy of the roads by stalls and
vendors, normal transportation flow is
disrupted and school children have to get off
at a distance still far from their schools and
walk, rain or shine.
Indeed one can only imagine the garbage
and litter left by vendors on the streets at the
end of the day. Needless to say, these cause
further pollution, sickness and deterioration
of health of the residents therein. (pp. 2122, Rollo)
Respondents do not refute the truth of the foregoing findings
and observations of petitioners. Instead, respondents want this
Court to focus its attention solely on the argument that the use
of public spaces for the establishment of a flea market is well
within the powers granted by law to a local government which
should not be interfered with by the courts.
Verily, the powers of a local government unit are not absolute.
They are subject to limitations laid down by toe Constitution
and the laws such as our Civil Code. Moreover, the exercise of

The instant case as well as the Dacanay case, involves an

ordinance which is void and illegal for lack of basis and
authority in laws applicable during its time. However, at this
point, We find it worthy to note that Batas Pambansa Blg. 337,
known as Local Government Lode, has already been repealed
by Republic Act No. 7160 known as Local Government Code of
1991 which took effect on January 1, 1992. Section 5(d) of the
new Code provides that rights and obligations existing on the
date of effectivity of the new Code and arising out of contracts
or any other source of prestation involving a local government
unit shall be governed by the original terms and conditions of
the said contracts or the law in force at the time such rights
were vested.
ACCORDINGLY, the petition is GRANTED and the decision of
the respondent Regional Trial Court dated December 17, 1990
which granted the writ of preliminary injunction enjoining
petitioner as PNP Superintendent, Metropolitan Traffic
Command from enforcing the demolition of market stalls along
J. Gabriel, G.G. Cruz, Bayanihan, Lt. Garcia Extension and
Opena streets is hereby RESERVED and SET ASIDE.
SO ORDERED.