26. Dela Cruz vs. Paras
00 a
FACTS: Vicente De La Cruz et al were club & cabaret
operators. They assail the constitutionality of Ord.
No. 84, Ser. of 1975 or the Prohibition and Closure
Ordinance of Bocaue, Bulacan. De la Cruz averred
that the said Ordinance violates their right to engage
in a lawful business for the said ordinance would
close out their business. That the hospitality girls
they employed are healthy and are not allowed to go
out with customers. Judge Paras however lifted the
TRO he earlier issued against Ord. 84 after due
hearing declaring that Ord 84. is constitutional for it
is pursuant to RA 938 which reads “AN ACT
GRANTING MUNICIPAL OR CITY BOARDS AND
COUNCILS THE POWER TO REGULATE THE
ESTABLISHMENT, MAINTENANCE AND OPERATION
OF CERTAIN PLACES OF AMUSEMENT WITHIN THEIR
RESPECTIVE TERRITORIAL JURISDICTIONS”. Paras
ruled that the prohibition is a valid exercise of police
power to promote general welfare. De la Cruz then
appealed citing that they were deprived of due
process.
ISSUE: Whether or not a municipal corporation,
Bocaue, Bulacan can, prohibit the exercise of a
lawful trade, the operation of night clubs, and the
pursuit of a lawful occupation, such clubs employing
hostesses pursuant to Ord 84 which is further in
pursuant to RA 938.
HELD: The SC ruled against Paras. If night clubs were
merely then regulated and not prohibited, certainly
the assailed ordinance would pass the test of
validity. SC had stressed reasonableness, consonant
with the general powers and purposes of municipal
corporations, as well as consistency with the laws or
policy of the State. It cannot be said that such a
sweeping exercise of a lawmaking power by Bocaue
could qualify under the term reasonable. The
objective of fostering public morals, a worthy and
desirable end can be attained by a measure that
does not encompass too wide a field. Certainly the
ordinance on its face is characterized by
overbreadth. The purpose sought to be achieved
could have been attained by reasonable restrictions
rather than by an absolute prohibition. Pursuant to
the title of the Ordinance, Bocaue should and can
only regulate not prohibit the business of cabarets.
27. Binay vs. Domingo
Facts: Petitioner Municipality of Makati, through its
Council, approved Resolution No. 60 which extends
P500 burial assistance to bereaved families whose
gross family income does not exceed P2,000.
month. The funds are to be taken out of the
unappropriated available funds in the municipal
treasury. The Metro Manila Commission approved
the resolution. Thereafter, the municipal secretary
certified a disbursement of P400,000.00 for the
implementation of the program. However, the
Commission on Audit disapproved said resolution
and the disbursement of funds for the
implementation thereof for the following reasons:
(1) the resolution has no connection to alleged
public safety, general welfare, safety, etc. of the
inhabitants of Makati; (2) government funds must be
disbursed for public purposes only; and, (3) it
violates the equal protection clause since it will only
benefit a few individuals.
Issues:
Whether Resolution No. 60 is a valid exercise of the
police power under the general welfare clause
Held:
1. The police power is a governmental function, an
inherent attribute of sovereignty, which was born
with civilized government. It is founded largely on
the maxims, "Sic utere tuo et ahenum non laedas
and "Salus populi est suprema lex. Its fundamental
purpose is securing the general welfare, comfort and
convenience of the people.
Police power is inherent in the state but not in
municipal corporations. Before a municipal
corporation may exercise such power, there must be
a valid delegation of such power by the legislature
which is the repository of the inherent powers of the
State.
Municipal governments exercise this power under
the general welfare clause. Pursuant thereto they
are clothed with authority to "enact such ordinances
and issue such regulations as may be necessary to
carry out and discharge the responsibilities
conferred upon it by law, and such as shall be
necessary and proper to provide for the health,
safety, comfort and convenience, maintain peace
and order, improve public morals, promote the
prosperity and general welfare of the municipality
and the inhabitants thereof, and insure the
protection of property therein.
28. Tan vs. Socrates
FACTS: On Dec 15, 1992, the Sangguniang
Panglungsod ng Puerto Princesa enacted an
ordinance banning the shipment of all live fish and
lobster outside Puerto Princesa City from January 1,
1993 to January 1, 1998. Subsequently the
Sangguniang Panlalawigan, Provincial Government
of Palawan enacted a resolution prohibiting the
catching , gathering, possessing, buying, selling, and
shipment of a several species of live marine coral
dwelling aquatic organisms for 5 years, in and
coming from Palawan waters.
Petitioners filed a special civil action for certiorari
and prohibition, praying that the court declare the
said ordinances and resolutions as unconstitutional
on the ground that the said ordinances deprived
them of the due process of law, their livelihood, and
unduly restricted them from the practice of their
trade, in violation of Section 2, Article XII and
Sections 2 and 7 of Article XIII of the 1987
Constitution.
ISSUE:
Are the challenged ordinances unconstitutional?
HELD:
No. The Supreme Court found the petitioners
contentions baseless and held that the challenged
ordinances did not suffer from any infirmity, both
under the Constitution and applicable laws. There is
absolutely no showing that any of the petitioners
qualifies as a subsistence or marginal fisherman.
Besides, Section 2 of Article XII aims primarily not to
bestow any right to subsistence fishermen, but to lay
stress on the duty of the State to protect the
nation’s marine wealth. The so-called “preferential
right” of subsistence or marginal fishermen to the
use of marine resources is not at all absolute.
In accordance with the Regalian Doctrine, marine
resources belong to the state and pursuant to the
first paragraph of Section 2, Article XII of the
Constitution, their “exploration, development and
utilization...shall be under the full control and
supervision of the State.
In addition, one of the devolved powers of the LCG
on devolution is the enforcement of fishery laws in
municipal waters including the conservation of
mangroves. This necessarily includes the enactment
of ordinances to effectively carry out such fishery
laws within the municipal waters. In light of the
principles of decentralization and devolution
enshrined in the LGC and the powers granted
therein to LGUs which unquestionably involve the
exercise of police power, the validity of the
questioned ordinances cannot be doubted.
29. White Light Corp. vs. City of Manila
FACTS: On 3 Dec 1992, then Mayor Lim signed into
law Ord 7774 entitled “An Ordinance” prohibiting
short time admission in hotels, motels, lodging
houses, pension houses and similar establishments
in the City of Manila. White Light Corp is an operator
of mini hotels and motels who sought to have the
Ordinance be nullified as the said Ordinance
infringes on the private rights of their patrons. The
RTC ruled in favor of WLC. It ruled that the
Ordinance strikes at the personal liberty of the
individual guaranteed by the Constitution. The City
maintains that the ordinance is valid as it is a valid
exercise of police power. Under the LGC, the City is
empowered to regulate the establishment,
operation and maintenance of cafes, restaurants,
beerhouses, hotels, motels, inns, pension houses,
lodging houses and other similar establishments,
including tourist guides and transports. The CA ruled
in favor of the City.
ISSUE: Whether or not Ord 7774 is valid.
HELD: The SC ruled that the said ordinance is null
and void as it indeed infringes upon individual
liberty. It also violates the due process clause which
serves as a guaranty for protection against arbitrary
regulation or seizure. The said ordinance invades
private rights. Note that not all who goes into motels
and hotels for wash up rate are really there for
obscene purposes only. Some are tourists who
needed rest or to “wash up” or to freshen up. Hence,
the infidelity sought to be avoided by the said
ordinance is more or less subjected only to a limited
group of people. The SC reiterates that individual
rights may be adversely affected only to the extent
that may fairly be required by the legitimate
demands of public interest or public welfare.
30. Social Justice Soc vs. Atienza
FACTS: Petitioners Social Justice Society (SJS) et.al.
filed a petition against Hon. Jose L. Atienza, Jr., then
mayor of the City of Manila, to enforce Ordinance
No. 8027, reclassifying the Oil Depot in Pandacan
Terminal, from industrial to commercial area and to
cease and desist from operating their businesses
from the date of effectivity of the ordinance.

Oil companies, Chevron, Shell, Petron as well as DOE
sought to intervene and asked for the nullification of
said ordinance. The oil companies assert that they
have a legal interest in this case because the
implementation of Ordinance No. 8027 will directly
affect their business and property rights. They allege
that they stand to lose billions of pesos if forced to
relocate.
On the other hand, the Committee on Housing,
Resettlement and Urban Development of the City of
Manila who recommended the approval of the
ordinance cited:
The depot facilities contained 313.5 million liters of
highly flammable and highly volatile products which
include petroleum gas, liquefied petroleum gas,
aviation fuel, diesel, gasoline, kerosene and fuel oil
among others; The depot is open to attack through
land, water or air; It is situated in a densely
populated place and near Malacañang Palace and
In case of an explosion or conflagration in the depot,
the fire could spread to the neighboring
communities.
ISSUE: Whether the enactment of the ordinance a
legitimate exercise of Police Power.
HELD:
Yes. The ordinance was intended to safeguard the
rights to life, security and safety of all the
inhabitants of Manila and not just of a particular
class.
In the exercise of police power, property rights of
individuals may be subjected to restraints and
burdens in order to fulfill the objectives of the
government. Otherwise stated, the government may
enact legislation that may interfere with personal
liberty, property, lawful businesses and occupations
to promote the general welfare.However, the
interference must be reasonable and not arbitrary.
And to forestall arbitrariness, the methods or means
used to protect public health, morals, safety or
welfare must have a reasonable relation to the end
in view.
Essentially, the oil companies are fighting for their
right to property. They allege that they stand to lose
billions of pesos if forced to relocate. However,
based on the hierarchy of constitutionally protected
rights, the right to life enjoys precedence over the
right to property. The reason is obvious: life is
irreplaceable, property is not. When the state or
LGU’s exercise of police power clashes with a few
individuals’ right to property, the former should
prevail. SC reiterated the enforcement of Ordinance
No. 8027.
31. MANILA INTERNATIONAL AIRPORT AUTHORITY
v. CA
Facts: Petitioner Manila International Airport
Authority (MIAA) operates the Ninoy Aquino
International Airport (NAIA). As operator of the
international airport, MIAA administers the land,
improvements and equipment within the NAIA
Complex. The MIAA Charter transferred to MIAA
approximately 600 hectares of land,... The MIAA
Charter further provides that no portion of the land
transferred to MIAA shall be disposed of through
sale or any other mode unless specifically approved
by the President of the Philippines.
The OGCC opined that the Local Government Code
of 1991 withdrew the exemption from real estate
tax granted to MIAA under Section 21 of the MIAA
Charter. Thus, MIAA negotiated with... respondent
City of Parañaque to pay the real estate tax imposed
by the City. MIAA then paid some of the real estate
tax already due.
MIAA received Final Notices of Real Estate Tax
Delinquency from the City of Parañaque. The Mayor
of the City of Parañaque threatened to sell at public
auction the Airport Lands and Buildings should MIAA
fail to pay the real estate tax delinquency.
MIAA filed with the Court of Appeals an original
petition for prohibition and injunction.
The petition sought to restrain the City of Parañaque
from imposing real estate tax on, levying... against,
and auctioning for public sale the Airport Lands and
Buildings.
Court of Appeals dismissed the petition because
MIAA filed it beyond the 60-day reglementary
period.
Court of Appeals also denied... motion for
reconsideration the present petition for review.
MIAA insists that it is... exempt from real estate tax
under Section 234 of the Local Government Code
because the Airport Lands and Buildings are owned
by the Republic.
To justify the exemption, MIAA invokes the principle
that the government cannot tax itself.
Respondents invoke Section 193 of the Local
Government Code, which expressly withdrew the tax
exemption privileges of "government-owned and-
controlled corporations" upon the effectivity of the
Local Government Code.
Issues: whether the Airport Lands and Buildings of
MIAA are exempt from real estate tax under existing
laws.
Ruling:
We rule that MIAA's Airport Lands and Buildings are
exempt from real estate tax imposed by local
governments.
First, MIAA is not a government-owned or controlled
corporation but an instrumentality of the National
Government and thus exempt from local taxation.
Second, the real properties of MIAA are owned by
the Republic of the Philippines and thus... exempt
from real estate tax.
There is no dispute that a government-owned or
controlled corporation is not exempt from real
estate tax. However, MIAA is not a government-
owned or controlled corporation.
Since MIAA is neither a stock nor a non-stock
corporation, MIAA does not qualify as a
government-owned or controlled corporation.
MIAA is a government instrumentality vested with
corporate powers to perform efficiently its
governmental functions. MIAA is like any other
government instrumentality, the only difference is
that MIAA is vested with corporate powers.
When the law vests in a government instrumentality
corporate powers, the instrumentality does not
become a corporation. Unless the government
instrumentality is organized as a stock or non-stock
corporation, it remains a government
instrumentality exercising not only... governmental
but also corporate powers. Thus, MIAA exercises the
governmental powers of eminent domain,... police
authority and the levying of fees and charges.
At the same time, MIAA exercises "all the... powers
of a corporation under the Corporation Law, insofar
as these powers are not inconsistent with the
provisions of this Executive Order."
When local governments invoke the power to tax on
national government instrumentalities, such power
is construed strictly against local governments. The
rule is that a tax is never presumed and there must
be clear language in the law imposing the tax. Any
doubt whether a person,... article or activity is
taxable is resolved against taxation. This rule applies
with greater force when local governments seek to
tax national government instrumentalities.
Another rule is that a tax exemption is strictly
construed against the taxpayer claiming the
exemption. However, when Congress grants an
exemption to a national government instrumentality
from local taxation, such exemption is construed
liberally in favor of the national... government
instrumentality.
There must be express language in the law
empowering local governments to tax national
government instrumentalities. Any doubt whether
such power exists is resolved against local...
governments.
32. Mactan Cebu Int’l Airport Auth vs. Marcos
Facts:
Petitioner Mactan Cebu International Airport
Authority was created by virtue of R.A. 6958,
mandated to principally undertake the economical,
efficient, and effective control, management, and
supervision of the Mactan International Airport and
Lahug Airport, and such other airports as may be
established in Cebu.
Since the time of its creation, petitioner MCIAA
enjoyed the privilege of exemption from payment of
realty taxes in accordance with Section 14 of its
charter. However, on October 11, 1994, Mr.
Eustaquio B. Cesa, Officer in Charge, Office of the
Treasurer of the City of Cebu, demanded payment
from realty taxes in the total amount of
P2229078.79. Petitioner objected to such demand
for payment as baseless and unjustified claiming in
its favor the afore cited Section 14 of R.A. 6958. It
was also asserted that it is an instrumentality of the
government performing governmental functions,
citing Section 133 of the Local Government Code of
1991.

Section 133. Common limitations on the Taxing
Powers of Local Government Units.
The exercise of the taxing powers of the provinces,
cities, barangays, municipalities shall not extend to
the levi of the following:
xxx Taxes, fees or charges of any kind in the National
Government, its agencies and instrumentalities, and
LGU’s. xxx
Respondent City refused to cancel and set aside
petitioner’s realty tax account, insisting that the
MCIAA is a government-controlled corporation
whose tax exemption privilege has been withdrawn
by virtue of Sections 193 and 234 of Local
Government Code that took effect on January 1,
1992.
Issue:
Whether or not the petitioner is a “taxable person”
Rulings:
Taxation is the rule and exemption is the exception.
MCIAA’s exemption from payment of taxes is
withdrawn by virtue of Sections 193 and 234 of Local
Government Code. Statutes granting tax exemptions
shall be strictly construed against the taxpayer and
liberally construed in favor of the taxing authority.
The petitioner cannot claim that it was never a
“taxable person” under its Charter. It was only
exempted from the payment of realty taxes. The
grant of the privilege only in respect of this tax is
conclusive proof of the legislative intent to make it a
taxable person subject to all taxes, except real
property tax.
33. City of Quezon vs. Bayan Telecom
FACTS
Respondent Bayan Telecommunications, Inc.
(Bayantel) is a legislative franchise holder under
Republic Act (R.A.) No. 3259 (1961) to establish and
operate radio stations for domestic
telecommunications, radiophone, broadcasting and
telecasting. Section 14 (a) of R.A. No. 3259 states:
“The grantee shall be liable to pay the same taxes on
its real estate, buildings and personal property,
exclusive of the franchise, xxx”. In 1992, R.A. No.
7160, otherwise known as the “Local Government
Code of 1991” (LGC) took effect. Section 232 of the
Code grants local government units within the Metro
Manila Area the power to levy tax on real properties.
Barely few months after the LGC took effect,
Congress enacted R.A. No. 7633, amending
Bayantel’s original franchise. The Section 11 of the
amendatory contained the following tax provision:
“The grantee, its successors or assigns shall be liable
to pay the same taxes on their real estate, buildings
and personal property, exclusive of this franchise,
xxx“. In 1993, the government of Quezon City
enacted an ordinance otherwise known as the
Quezon City Revenue Code withdrawing tax
exemption privileges.
ISSUE: Whether or not Bayantel’s real properties in
Quezon City are exempt from real property taxes
under its franchise.
RULING
YES. A clash between the inherent taxing power of
the legislature, which necessarily includes the power
to exempt, and the local government’s delegated
power to tax under the aegis of the 1987
Constitution must be ruled in favor of the former.
The grant of taxing powers to LGUs under the
Constitution and the LGC does not affect the power
of Congress to grant exemptions to certain persons,
pursuant to a declared national policy. The legal
effect of the constitutional grant to local
governments simply means that in interpreting
statutory provisions on municipal taxing powers,
doubts must be resolved in favor of municipal
corporations.
The legislative intent expressed in the phrase
“exclusive of this franchise” cannot be construed
other than distinguishing between two (2) sets of
properties, be they real or personal, owned by the
franchisee, namely, (a) those actually, directly and
exclusively used in its radio or telecommunications
business, and (b) those properties which are not so
used. It is worthy to note that the properties subject
of the present controversy are only those which are
admittedly falling under the first category.
Since R. A. No. 7633 was enacted subsequent to the
LGC, perfectly aware that the LGC has already
withdrawn Bayantel’s former exemption from realty
taxes, the Congress using, Section 11 thereof with
exactly the same defining phrase “exclusive of this
franchise” is the basis for Bayantel’s exemption from
realty taxes prior to the LGC. In plain language, the
Court views this subsequent piece of legislation as
an express and real intention on the part of Congress
to once again remove from the LGC’s delegated
taxing power, all of the franchisee’s (Bayantel’s)
properties that are actually, directly and exclusively
used in the pursuit of its franchise.
34. Drilon vs. Lim
FACTS: The principal issue in this case is the
constitutionality of Section 187 of the Local
Government Code. The Secretary of Justice (on
appeal to him of four oil companies and a taxpayer)
declared Ordinance No. 7794 (Manila Revenue Code)
null and void for non-compliance with the procedure
in the enactment of tax ordinances and for
containing certain provisions contrary to law and
public policy.
RTC’s Ruling:
1. The RTC revoked the Secretary’s resolution and
sustained the ordinance. It declared Sec 187 of the
LGC as unconstitutional because it vests on the
Secretary the power of control over LGUs in violation
of the policy of local autonomy mandated in the
Constitution.
Petitioner’s Argument:
1. The annulled Section 187 is constitutional and
that the procedural requirements for the enactment
of tax ordinances as specified in the Local
Government Code had indeed not been observed.
(Petition originally dismissed by the Court due to
failure to submit certified true copy of the decision,
but reinstated it anyway.)
2. Grounds of non-compliance of procedure
a. No written notices as required by Art
276 of Rules of Local Government Code
b. Not published
c. Not translated to tagalog
ISSUE: whether Sec. 187 LGC is Unconstitutional
HELD:
1. Section 187 authorizes the petitioner to review
only the constitutionality or legality of tax ordinance.
What he found only was that it was illegal. That act is
not control but supervision.
2. Control lays down the rules in the doing of act
and if not followed order the act undone or re-done.
Supervision sees to it that the rules are followed.
3. Two grounds of declaring Manila Revenue Code
null and void (1) inclusion of certain ultra vires
provisions (2) non-compliance with prescribed
procedure in its enactment but were followed.
The requirements are upon approval of local
development plans and public investment programs
of LGU not to tax ordinances.
35. Batangas city vs. Pilipinas Shell
FACTS: Petitioner Batangas City is a local
government unit (LGU) with the capacity to sue and
be sued under its Charter and Section 22(a)(2) of the
Local Government Code (LGC) of 1991. Petitioners
Teodulfo A. Deguito and Benjamin E. Pargas are the
City Legal Officer and City Treasurer, respectively, of
Batangas City.
Respondent Pilipinas Shell Petroleum Corporation
operates an oil refinery and depot in Tabagao,
Batangas City, which manufactures and produces
petroleum products that are distributed nationwide.
In 2002, respondent was only paying the amount of
P98,964.71 for fees and other charges which include
the amount of P1,180.34 as Mayor's Permit.
However, on February 20, 2001, petitioner Batangas
City, through its City Legal Officer, sent a notice of
assessment to respondent demanding the payment
of P92,373,720.50 and P312,656,253.04 as business
taxes for its manufacture and distribution of
petroleum products. In addition, respondent was
also required and assessed to pay the amount of
P4,299,851.00 as Mayor's Permit Fee based on the
gross sales of its Tabagao Refinery. The assessment
was allegedly pursuant of Section 134 of the LGC of
1991 and Section 23 of its Batangas City Tax Code of
2002.
On June 17, 2002, respondent filed a Petition for
Review pursuant to Section 195 of the LGC of 1991
before the Regional Trial Court (RTC) of Batangas
City. In its petition, respondent maintained that
petitioners have no authority to impose the said
taxes and fees, and argued that the levy of local
business taxes on the business of manufacturing and
distributing gasoline and other petroleum products
is contrary to law and against national policy. It
further contended that the Mayor's Permit Fee
levied by petitioners were unreasonable and
confiscatory.
In its Answer, petitioners contended that the City of
Batangas can legally impose taxes on the business of
manufacturing and distribution of petroleum
products, including the Mayor's Permit Fees upon
respondent.
ISSUE: whether a LGU is empowered under the LGC
to impose business taxes on persons or entities
engaged in the business of manufacturing and
distribution of petroleum products.
HELD: At the outset, it must be emphasized that
although the power to tax is inherent in the State,
the same is not true for LGUs because although the
mandate to impose taxes granted to LGUs is
categorical and long established in the 1987
Philippine Constitution, the same is not all
encompassing as it is subject to limitations as
explicitly stated in Section 5, Article X of the 1987
Constitution, viz.:
SECTION 5. Each local government unit shall have
the power to create its own sources of revenues and
to levy taxes, fees, and charges subject to such
guidelines and limitations as the Congress may
provide, consistent with the basic policy of local
autonomy. Such taxes, fees, and charges shall accrue
exclusively to the local governments.
From the foregoing, Section 133(h) clearly specifies
the two kinds of taxes which cannot be imposed by
LGUs: (1) excise taxes on articles enumerated under
the NIRC, as amended; and (2) taxes, fees or charges
on petroleum products.
Indisputably, the power of LGUs to impose business
taxes derives from Section 143[14] of the LGC.
However, the same is subject to the explicit
statutory impediment provided for under Section
133(h) of the same Code which prohibits LGUs from
imposing "taxes, fees or charges on petroleum
products." It can, therefore, be deduced that
although petroleum products are subject to excise
tax, the same is specifically excluded from the broad
power granted to LGUs under Section 143(h) of the
LGC to impose business taxes.
36. City Gov. of QC vs. Ericta
Facts:
Section 9 of Ordinance No. 6118, S-64 provides that
at least 6% of the total area of the memorial park
cemetery shall be set aside for the charity burial of
deceased persons who are paupers and have been
residents of Quezon City for at least 5 years prior to
their death. As such, the Quezon City engineer
required the respondent, Himlayang Pilipino Inc, to
stop any further selling and/or transaction of
memorial park lots in Quezon City where the owners
thereof have failed to donate the required 6% space
intended for paupers burial.
The then Court of First Instance and its judge, Hon.
Ericta, declared Section 9 of Ordinance No. 6118, S-
64 null and void.
Petitioners argued that the taking of the
respondent’s property is a valid and reasonable
exercise of police power and that the land is taken
for a public use as it is intended for the burial ground
of paupers. They further argued that the Quezon
City Council is authorized under its charter, in the
exercise of local police power, ” to make such
further ordinances and resolutions not repugnant to
law as may be necessary to carry into effect and
discharge the powers and duties conferred by this
Act and such as it shall deem necessary and proper
to provide for the health and safety, promote the
prosperity, improve the morals, peace, good order,
comfort and convenience of the city and the
inhabitants thereof, and for the protection of
property therein.”
On the otherhand, respondent Himlayang Pilipino,
Inc. contended that the taking or confiscation of
property was obvious because the questioned
ordinance permanently restricts the use of the
property such that it cannot be used for any
reasonable purpose and deprives the owner of all
beneficial use of his property.
Issue:
Is Section 9 of the ordinance in question a valid
exercise of the police power?
Held:
No. The Sec. 9 of the ordinance is not a valid exercise
of the police power.
Occupying the forefront in the bill of rights is the
provision which states that ‘no person shall be
deprived of life, liberty or property without due
process of law’ (Art. Ill, Section 1 subparagraph 1,
Constitution). On the other hand, there are three
inherent powers of government by which the state
interferes with the property rights, namely-. (1)
police power, (2) eminent domain, (3) taxation.
These are said to exist independently of the
Constitution as necessary attributes of sovereignty.
An examination of the Charter of Quezon City (Rep.
Act No. 537), does not reveal any provision that
would justify the ordinance in question except the
provision granting police power to the City. Section 9
cannot be justified under the power granted to
Quezon City to tax, fix the license fee, and regulate
such other business, trades, and occupation as may
be established or practised in the City. The power to
regulate does not include the power to prohibit or
confiscate. The ordinance in question not only
confiscates but also prohibits the operation of a
memorial park cemetery.
Police power is defined by Freund as ‘the power of
promoting the public welfare by restraining and
regulating the use of liberty and property’. It is
usually exerted in order to merely regulate the use
and enjoyment of property of the owner. If he is
deprived of his property outright, it is not taken for
public use but rather to destroy in order to promote
the general welfare. In police power, the owner does
not recover from the government for injury
sustained in consequence thereof.
Under the provisions of municipal charters which are
known as the general welfare clauses, a city, by
virtue of its police power, may adopt ordinances to
the peace, safety, health, morals and the best and
highest interests of the municipality. It is a well-
settled principle, growing out of the nature of well-
ordered and society, that every holder of property,
however absolute and may be his title, holds it under
the implied liability that his use of it shall not be
injurious to the equal enjoyment of others having an
equal right to the enjoyment of their property, nor
injurious to the rights of the community.
A property in the state is held subject to its general
regulations, which are necessary to the common
good and general welfare. Rights of property, like all
other social and conventional rights, are subject to
such reasonable limitations in their enjoyment as
shall prevent them from being injurious, and to such
reasonable restraints and regulations, established by
law, as the legislature, under the governing and
controlling power vested in them by the
constitution, may think necessary and expedient.
The state, under the police power, is possessed with
plenary power to deal with all matters relating to the
general health, morals, and safety of the people, so
long as it does not contravene any positive inhibition
of the organic law and providing that such power is
not exercised in such a manner as to justify the
interference of the courts to prevent positive wrong
and oppression.
However, in the case at hand, there is no reasonable
relation between the setting aside of at least six (6)
percent of the total area of an private cemeteries for
charity burial grounds of deceased paupers and the
promotion of health, morals, good order, safety, or
the general welfare of the people.
The ordinance is actually a taking without
compensation of a certain area from a private
cemetery to benefit paupers who are charges of the
municipal corporation. Instead of building or
maintaining a public cemetery for this purpose, the
city passes the burden to private cemeteries.
The expropriation without compensation of a
portion of private cemeteries is not covered by
Section 12(t) of Republic Act 537, the Revised
Charter of Quezon City which empowers the city
council to prohibit the burial of the dead within the
center of population of the city and to provide for
their burial in a proper place subject to the
provisions of general law regulating burial grounds
and cemeteries.
When the Local Government Code, Batas Pambansa
Blg. 337 provides in Section 177 (q) that a
Sangguniang panlungsod may “provide for the burial
of the dead in such place and in such manner as
prescribed by law or ordinance” it simply authorizes
the city to provide its own city owned land or to buy
or expropriate private properties to construct public
cemeteries. This has been the law and practise in the
past. It continues to the present. Expropriation,
however, requires payment of just compensation.
The questioned ordinance is different from laws and
regulations requiring owners of subdivisions to set
aside certain areas for streets, parks, playgrounds,
and other public facilities from the land they sell to
buyers of subdivision lots. The necessities of public
safety, health, and convenience are very clear from
said requirements which are intended to insure the
development of communities with salubrious and
wholesome environments. The beneficiaries of the
regulation, in turn, are made to pay by the
subdivision developer when individual lots are sold
to home-owners. WHEREFORE, the petition for
review is hereby DISMISSED. The decision of the
respondent court is affirmed.
37. City of Cebu vs. Spouses Apolonio and Dedamo
Facts: Petitioner City of Cebu filed a complaint for
eminent domain against respondents spouses
Apolonio and Blasa Dedamo.
The petitioner alleged therein that it needed the
following parcels of land of respondents for a public
purpose , i.e., for the construction of a public road.
The total area sought to be expropriated is 1,624
square meters with an assessed value of P1,786,400.
Petitioner deposited with the Philippine National
Bank the amount of P51,156 representing 15% of
the fair market value of the property to enable the
petitioner to take immediate possession of the
property pursuant to Section 19 of R.A. No. 7160.
Respondents, filed a motion to dismiss the complaint
because the purpose for which their property was to
be expropriated was not for a public purpose but for
benefit of a single private entity, the Cebu Holdings,
Inc. Petitioner could simply buy directly from them
the property at its fair market value if it wanted to,
just like what it did with the neighboring lots.
Besides, the price offered was very low in light of the
consideration of P20,000 per square meter, more or
less, which petitioner paid to the neighboring lots.
Petitioner filed a motion for the issuance of a writ of
possession. The motion was granted by the trial
court the parties executed and submitted to the trial
court an Agreement... wherein they declared that
they have partially settled the case and in
consideration thereof they agreed. Pursuant to said
agreement, the trial court appointed three
commissioners to determine the just compensation
of the lots sought to be expropriated.
Thereafter, the commissioners submitted their
report, which contained their respective
assessments of and recommendation as to the
valuation of the property.
Plaintiff is directed to pay Spouses Apolonio S.
Dedamo and Blasa Dedamo the sum of pesos:
P24,865.930.00... the commissioners submitted an
amended assessment... and fixed it at
P12,824.10 per square meter, or in the amount of
P20,826,339.50.
he assessment was approved as the just
compensation thereof by the trial court
Petitioner elevated the case to the Court of
Appeals... etitioner alleged that... just compensation
should be based on the prevailing... market price of
the property at the commencement of the
expropriation proceedings. Court of Appeals
affirmed in toto the decision of the trial court.
Petitioner filed with us the petition for review in the
case at bar.
Issues:
Whether just compensation should be determined
as of the date of the filing of the complaint.
Ruling:
Just compensation shall be determined as of the
time of actual taking.
We explicitly stated that although the general rule
in determining just compensation in eminent
domain is the value of the property as of the date of
the filing of the complaint, the rule "admits of an
exception: where this Court fixed the value of the
property as of the date it was taken and not at... the
date of the commencement of the expropriation
proceedings."
Also, the trial court followed the then governing
procedural law on the matter, which was Section 5
of Rule 67 of the Rules of Court, which provided as
follows:
SEC. 5. Ascertainment of compensation. -- Upon the
entry of the order of condemnation, the court shall
appoint not more than three (3) competent and
disinterested persons as commissioners to ascertain
and report to the court the just compensation for
the... property sought to be taken. The order of
appointment shall designate the time and place of
the first session of the hearing to be held by the
commissioners and specify the time within which
their report is to be filed with the court.
The parties, by a solemn document freely and
voluntarily agreed upon by them, agreed to be
bound by the report of the commission and
approved by the trial court. The agreement is a
contract between the parties. It has the force of law
between them and should be complied with in good
faith.
38. Republic, as manager of Phil. Information
Agency (PIA) vs. CA
FACTS:
Petitioner (PIA) instituted expropriation proceedings
covering a total of 544,980 square meters of
contiguous land situated along MacArthur Highway,
Malolos, Bulacan, to be utilized for the continued
broadcast operation and use of radio transmitter
facilities for the “Voice of the Philippines” project.
Petitioner made a deposit of P517,558.80, the sum
provisionally fixed as being the reasonable value of
the property. On 26 February 1979, or more than 9
years after the institution of the expropriation
proceedings, the trial court issued this order
condemning the property and ordering the plaintiff
to pay the defendants the just compensation for the
property.
It would appear that the National Government failed
to pay the respondents the just compensation
pursuant to the foregoing decision. The respondents
then filed a manifestation with a motion seeking
payment for the expropriated property. In response,
the court issued a writ of execution for the
implementation thereof.
Meanwhile, Pres. Estrada issued Proc. No. 22
transferring 20 hectares of the expropriated land to
the Bulacan State University.
Despite the court’s order, the Santos heirs remained
unpaid and no action was on their case until
petitioner filed its manifestation and motion to
permit the deposit in court of the amount
P4,664,000 by way of just compensation.
The Santos heirs submitted a counter-motion to
adjust the compensation from P6/sq.m. as
previously fixed to its current zonal value of
P5,000/sq.m. or to cause the return of the
expropriated property.
The RTC Bulacan ruled in favor of the Santos heirs
declaring its 26 February 1979 Decision to be
unenforceable on the ground of prescription in
accordance with Sec. 6, Rule 39 of the 1964/1997
ROC which states that a final and executory
judgment or order may be executed on motion
within 5 years from the date of its entry. RTC denied
petitioner’s Motion to Permit Deposit and ordered
the return of the expropriated property to the heirs
of Santos.
ISSUES:
1. WON the petitioner may appropriate the
property
2. WON the respondents are entitled to the return of
the property in question
HELD:
1. The right of eminent domain is usually
understood to be an ultimate right of the sovereign
power to appropriate any property within its
territorial sovereignty for a public purpose.
Fundamental to the independent existence of a
State, it requires no recognition by the Constitution,
whose provisions are taken as being merely
confirmatory of its presence and as being regulatory,
at most, in the due exercise of the power. In the
hands of the legislature, the power is inherent, its
scope matching that of taxation, even that of police
power itself, in many respects. It reaches to every
form of property the State needs for public use and,
as an old case so puts it, all separate interests of
individuals in property are held under a tacit
agreement or implied reservation vesting upon the
sovereign the right to resume the possession of the
property whenever the public interest so requires it.
The ubiquitous character of eminent domain is
manifest in the nature of the expropriation
proceedings. Expropriation proceedings are not
adversarial in the conventional sense, for the
condemning authority is not required to assert any
conflicting interest in the property. Thus, by filing
the action, the condemnor in effect merely serves
notice that it is taking title and possession of the
property, and the defendant asserts title or interest
in the property, not to prove a right to possession,
but to prove a right to compensation for the taking.
Obviously, however, the power is not without its
limits:
first, the taking must be for public use, and
second, that just compensation must be given to the
private owner of the property.
These twin proscriptions have their origin in the
recognition of the necessity for achieving balance
between the State interests, on the one hand, and
private rights, upon the other hand, by effectively
restraining the former and affording protection to
the latter. In determining “public use,” two
approaches are utilized - the first is public
employment or the actual use by the public, and the
second is public advantage or benefit. It is also useful
to view the matter as being subject to constant
growth, which is to say that as society advances, its
demands upon the individual so increases, and each
demand is a new use to which the resources of the
individual may be devoted.
The expropriated property has been shown to be for
the continued utilization by the PIA, a significant
portion thereof being ceded for the expansion of the
facilities of the Bulacan State University and for the
propagation of the Philippine carabao, themselves in
line with the requirements of public purpose.
Respondents question the public nature of the
utilization by petitioner of the condemned property,
pointing out that its present use differs from the
purpose originally contemplated in the 1969
expropriation proceedings. The argument is of no
moment. The property has assumed a public
character upon its expropriation. Surely, petitioner,
as the condemnor and as the owner of the property,
is well within its rights to alter and decide the use of
that property, the only limitation being that it be for
public use, which, decidedly, it is.
2. NO. In insisting on the return of the expropriated
property, respondents would exhort on the
pronouncement in Provincial Government of
Sorsogon vs. Vda. de Villaroya where the unpaid
landowners were allowed the alternative remedy of
recovery of the property there in question. It might
be borne in mind that the case involved the
municipal government of Sorsogon, to which the
power of eminent domain is not inherent, but
merely delegated and of limited application. The
grant of the power of eminent domain to local
governments under Republic Act No. 7160 cannot be
understood as being the pervasive and all-
encompassing power vested in the legislative branch
of government. For local governments to be able to
wield the power, it must, by enabling law, be
delegated to it by the national legislature, but even
then, this delegated power of eminent domain is
not, strictly speaking, a power of eminent, but only
of inferior, domain or only as broad or confined as
the real authority would want it to be.
The constitutional limitation of “just compensation”
is considered to be the sum equivalent to the market
value of the property, broadly described to be the
price fixed by the seller in open market in the usual
and ordinary course of legal action and competition
or the fair value of the property as between one who
receives, and one who desires to sell, it fixed at the
time of the actual taking by the government. Thus, if
property is taken for public use before compensation
is deposited with the court having jurisdiction over
the case, the final compensation must include
interests on its just value to be computed from the
time the property is taken to the time when
compensation is actually paid or deposited with the
court. In fine, between the taking of the property
and the actual payment, legal interests accrue in
order to place the owner in a position as good as
(but not better than) the position he was in before
the taking occurred.
The Bulacan trial court, in its 1979 decision, was
correct in imposing interests on the zonal value of
the property to be computed from the time
petitioner instituted condemnation proceedings and
“took” the property in September 1969. This
allowance of interest on the amount found to be the
value of the property as of the time of the taking
computed, being an effective forbearance, at 12%
per annum should help eliminate the issue of the
constant fluctuation and inflation of the value of the
currency over time. Article 1250 of the Civil Code,
providing that, in case of extraordinary inflation or
deflation, the value of the currency at the time of
the establishment of the obligation shall be the basis
for the payment when no agreement to the contrary
is stipulated, has strict application only to
contractual obligations. In other words, a contractual
agreement is needed for the effects of extraordinary
inflation to be taken into account to alter the value
of the currency.
39. Sangalng vs. IAC
FACTS:
The Mayor of Makati directed Bel-Air Village
Association (BAVA) to opening of several streets to
the general public, after a series of developments in
zoning regulations. All but Jupiter St. was voluntarily
opened. The strong opposition later gave way when
the municipal officials force-opened the gates of said
street for public use. The area ceased to be purely
residential. Action for damages was brought against
Ayala Corporation and BAVA for alleged breach of
contract, to maintain the purely residential status of
the area. Other similarly situated also filed their
respective cases. All were dismissed in the trial
court. The Court of Appeals affirmed the said
dismissals.
ISSUE:
Whether or not there is a contract between
homeowners and Ayala Corporation violated in
opening the Jupiter street for public use.
HELD:
No. There was no contract to speak of in the case,
hence nothing was violated.
RATIO:
Petitioners cannot successfully rely on the alleged
promise by Ayala Corporation, to build a “[f]ence
along Jupiter [street] with gate for entrance and/or
exit as evidence of Ayala’s alleged continuing
obligation to maintain a wall between the residential
and commercial sections. Assuming there was a
contract violated, it was still overtaken by the
passage of zoning ordinances which represent a
legitimate exercise of police power. The petitioners
have not shown why Courts should hold otherwise
other than for the supposed “non-impairment”
guaranty of the Constitution, which is secondary to
the more compelling interests of general welfare.
The Ordinance has not been shown to be capricious
or arbitrary or unreasonable to warrant the reversal
of the judgments so appealed.
40. MMDA vs. Bel Air Village
FACTS
Petitioner MMDA is a government agency tasked
with the delivery of basic services in Metro Manila.
Respondent Bel-Air Village Association, Inc. (BAVA) is
a non-stock, non-profit corporation whose members
are homeowners in Bel-Air Village, a private
subdivision in Makati City. Respondent BAVA is the
registered owner of Neptune Street, a road inside
Bel-Air Village.
On December 30, 1995, respondent received from
petitioner, through its Chairman, a notice dated
December 22, 1995 requesting respondent to open
Neptune Street to public vehicular traffic starting
January 2, 1996.
Actions Filed:
1. BAVA – applied for injunction; trial court issued
temporary restraining order but after due hearing,
trial court denied the issuance of a preliminary
injunction.
2. BAVA – appealed to CA which issued
preliminary injunction and later ruled that MMDA
has no authority to order the opening of Neptune
Street, a private subdivision road and cause the
demolition of its perimeter walls. It held that the
authority is lodged in the City Council of Makati by
ordinance.
MMDA – filed motion for reconsideration but was
denied by CA; hence the current recourse.
ISSUES
1. 1. Has the MMDA the mandate to open
Neptune Street to public traffic pursuant to its
regulatory and police powers?
2. Is the passage of an ordinance a condition
precedent before the MMDA may order the opening
of subdivision roads to public traffic?
HELD
The MMDA is, as termed in the charter itself,
"development authority." All its functions are
administrative in nature.
The powers of the MMDA are limited to the
following acts: formulation, coordination, regulation,
implementation, preparation, management,
monitoring, setting of policies, installation of a
system and administration. There is no syllable in
R.A. No. 7924 that grants the MMDA police power,
let alone legislative power.
The MMDA has no power to enact ordinances for
the welfare of the community. It is the local
government units, acting through their respective
legislative councils that possess legislative power
and police power. In the case at bar, the
Sangguniang Panlungsod of Makati City did not pass
any ordinance or resolution ordering the opening of
Neptune Street, hence, its proposed opening by
petitioner MMDA is illegal and the respondent Court
of Appeals did not err in so ruling.
The MMDA was created to put some order in the
metropolitan transportation system but
unfortunately the powers granted by its charter are
limited. Its good intentions cannot justify the
opening for public use of a private street in a private
subdivision without any legal warrant. The
promotion of the general welfare is not antithetical
to the preservation of the rule of law.
42. Lucena Grand Central vs. JAC Liner
Two ordinances were enacted by the Sangguniang
Panlungsod of Lucena with the objective of
alleviating the traffic congestion said to have been
caused by the existence of various bus and jeepney
terminals within the city. City Ordinance 1631 grants
franchise to the Lucena Grand Central Terminal, Inc.
to construct, finance, establish, operate and
maintain common bus- jeepney terminal facility in
the City of Lucena.
City Ordinance 1778, on the other hand, strips out all
the temporary terminals in the City of Lucena the
right to operate which as a result favors only the
Lucena Grand Central Terminal, Inc. The Regional
Trial Court of Lucena declared City Ordinance 1631
as a valid excercise of police power while declaring
City Ordinance 1778 as null and void for being
invalid. Petitioner Lucena Grand Central Terminal,
Inc. filed its Motion for Reconsideration which was
denied.
Lucena then elevated it via petition for review under
Rule 45 before the Court. The Court referred the
petition to the Court of Appeals (CA) with which it
has concurrent jurisdiction. The CA dismissed the
petition and affirmed the challenged orders of the
trial court. Its motion for reconsideration having
been denied by the CA, Lucena now comes to the
Court via petition for review to assail the Decision
and Resolution of the CA.
ISSUE:
Whether or not the means employed by the Lucena
Sannguniang Panlungsod to attain its professed
objective were reasonably necessary and not duly
oppressive upon individuals.
HELD:
With the aim of localizing the source of traffic
congestion in the city to a single location, the subject
ordinances prohibit the operation of all bus and
jeepney terminals within Lucena, including those
already existing, and allow the operation of only one
common terminal located outside the city proper,
the franchise for which was granted to Lucena. The
common carriers plying routes to and from Lucena
City are thus compelled to close down their existing
terminals and use the facilities of Lucena.
The true role of Constitutional Law is to effect an
equilibrium between authority and liberty so that
rights are exercised within the framework of the law
and the laws are enacted with due deference to
rights. A due deference to the rights of the individual
thus requires a more careful formulation of solutions
to societal problems. From the memorandum filed
before the Court by Lucena, it is gathered that the
Sangguniang Panlungsod had identified the cause of
traffic congestion to be the indiscriminate loading
and unloading of passengers by buses on the streets
of the city proper, hence, the conclusion that the
terminals contributed to the proliferation of buses
obstructing traffic on the city streets.
Bus terminals per se do not, however, impede or
help impede the flow of traffic. How the outright
proscription against the existence of all terminals,
apart from that franchised to Lucena, can be
considered as reasonably necessary to solve the
traffic problem, the Court has not been enlightened.
If terminals lack adequate space such that bus
drivers are compelled to load and unload passengers
on the streets instead of inside the terminals, then
reasonable specifications for the size of terminals
could be instituted, with permits to operate the
same denied those which are unable to meet the
specifications. In the subject ordinances, however,
the scope of the proscription against the
maintenance of terminals is so broad that even
entities which might be able to provide facilities
better than the franchised terminal are barred from
operating at all.
The Court is not unaware of the resolutions of
various barangays in Lucena City supporting the
establishment of a common terminal, and similar
expressions of support from the private sector,
copies of which were submitted to this Court by
Lucena Grand Central Terminal, Inc. The weight of
popular opinion, however, must be balanced with
that of an individual‘s rights.
43. City of Manila vs. Hon. Laguio Jr.
FACTS:
On 30 Mar 1993, Mayor Lim signed into law Ord
7783 entitled AN ORDINANCE PROHIBITING THE
ESTABLISHMENT OR OPERATION OF BUSINESSES
PROVIDING CERTAIN FORMS OF AMUSEMENT,
ENTERTAINMENT, SERVICES AND FACILITIES IN THE
ERMITA-MALATE AREA, PRESCRIBING PENALTIES
FOR VIOLATION THEREOF, AND FOR OTHER
PURPOSES.
It basically prohibited establishments such as bars,
karaoke bars, motels and hotels from operating in
the Malate District which was notoriously viewed as
a red light district harboring thrill seekers. Malate
Tourist Development Corporation avers that the
ordinance is invalid as it includes hotels and motels
in the enumeration of places offering amusement or
entertainment.
MTDC reiterates that they do not market such nor
do they use women as tools for entertainment.
MTDC also avers that under the LGC, LGUs can only
regulate motels but cannot prohibit their operation.
The City reiterates that the Ordinance is a valid
exercise of Police Power as provided as well in the
LGC. The City likewise emphasized that the purpose
of the law is to promote morality in the City.
ISSUE: Whether or not Ordinance 7783 is valid.
HELD: The SC ruled that the said Ordinance is null
and void. The SC noted that for an ordinance to be
valid, it must not only be within the corporate
powers of the local government unit to enact and
must be passed according to the procedure
prescribed by law, it must also conform to the
following substantive requirements:
(1) must not contravene the Constitution or any
statute;
(2) must not be unfair or oppressive;
(3) must not be partial or discriminatory;
(4) must not prohibit but may regulate trade;
(5) must be general and consistent with public
policy; and
(6) must not be unreasonable.
The police power of the City Council, however broad
and far-reaching, is subordinate to the constitutional
limitations thereon; and is subject to the limitation
that its exercise must be reasonable and for the
public good. In the case at bar, the enactment of the
Ordinance was an invalid exercise of delegated
power as it is unconstitutional and repugnant to
general laws.
44. Social Justice Society vs. Atienza
FACTS: Petitioners Social Justice Society (SJS) et.al.
filed a petition against Hon. Jose L. Atienza, Jr., then
mayor of the City of Manila, to enforce Ordinance
No. 8027, reclassifying the Oil Depot in Pandacan
Terminal, from industrial to commercial area and to
cease and desist from operating their businesses
from the date of effectivity of the ordinance.
Oil companies, Chevron, Shell, Petron as well as DOE
sought to intervene and asked for the nullification of
said ordinance. The oil companies assert that they
have a legal interest in this case because the
implementation of Ordinance No. 8027 will directly
affect their business and property rights. They allege
that they stand to lose billions of pesos if forced to
relocate.
On the other hand, the Committee on Housing,
Resettlement and Urban Development of the City of
Manila who recommended the approval of the
ordinance cited:
The depot facilities contained 313.5 million liters of
highly flammable and highly volatile products which
include petroleum gas, liquefied petroleum gas,
aviation fuel, diesel, gasoline, kerosene and fuel oil
among others; The depot is open to attack through
land, water or air; It is situated in a densely
populated place and near Malacañang Palace and
In case of an explosion or conflagration in the depot,
the fire could spread to the neighboring
communities.
ISSUE: Whether the enactment of the ordinance a
legitimate exercise of Police Power.
HELD:
Yes. The ordinance was intended to safeguard the
rights to life, security and safety of all the
inhabitants of Manila and not just of a particular
class.
In the exercise of police power, property rights of
individuals may be subjected to restraints and
burdens in order to fulfill the objectives of the
government. Otherwise stated, the government may
enact legislation that may interfere with personal
liberty, property, lawful businesses and occupations
to promote the general welfare. However, the
interference must be reasonable and not arbitrary.
And to forestall arbitrariness, the methods or means
used to protect public health, morals, safety or
welfare must have a reasonable relation to the end
in view.
Essentially, the oil companies are fighting for their
right to property. They allege that they stand to lose
billions of pesos if forced to relocate. However,
based on the hierarchy of constitutionally protected
rights, the right to life enjoys precedence over the
right to property. The reason is obvious: life is
irreplaceable, property is not. When the state or
LGU’s exercise of police power clashes with a few
individuals’ right to property, the former should
prevail.