POLICE POWER

1. G.R. No. 92389 September 11, 1991

HON. JEJOMAR C. BINAY and the MUNICIPALITY OF MAKATI, petitioners, vs. HON.
EUFEMIO DOMINGO and the COMMISSION ON AUDIT, respondents.
FACTS: On September 27, 1988, petitioner Municipality approved Resolution No. 60
which reads:

A RESOLUTION TO CONFIRM AND/OR RATIFY THE ONGOING BURIAL

ASSISTANCE PROGRAM INITIATED BY THE OFFICE OF THE MAYOR, OF
EXTENDING FINANCIAL ASSISTANCE OF FIVE HUNDRED PESOS (P500.00)
TO A BEREAVED FAMILY, FUNDS TO BE TAKEN OUT OF UNAPPROPRIATED
AVAILABLE FUNDS EXISTING IN THE MUNICIPAL TREASURY.
Qualified beneficiaries, under the Burial Assistance Program, are bereaved families of
Makati whose gross family income does not exceed two thousand pesos (P2,000.00) a
month. The beneficiaries, upon fulfilment of other requirements, would receive the amount
of five hundred pesos (P500.00) cash relief from the Municipality of Makati.
Resolution No. 60 was referred to respondent Commission on Audit (COA) for its
expected allowance in audit. Based on its preliminary findings, respondent COA
disapproved Resolution No. 60 and disallowed in audit the disbursement of finds for the
implementation thereof.
Two letters for reconsideration filed by petitioner Mayor Jejomar Binay, were denied by
respondent in its Decision No. 1159, in the following manner:
Your request for reconsideration is predicated on the following grounds, to wit:
1. Subject Resolution No. 60, s. 1988, of the Municipal Council of Makati and the
intended disbursements fall within the twin principles of 'police power and parens
patriae and
2. The Metropolitan Manila Commission (MMC), under a Certification, dated June
5, 1989, has already appropriated the amount of P400,000.00 to implement the Id
resolution, and the only function of COA on the matter is to allow the financial
assistance in question.
The first contention is believed untenable. Suffice it to state that:
A statute or ordinance must have a real substantial, or rational relation to
the public safety, health, morals, or general welfare to be sustained as a
legitimate exercise of the police power. The mere assertion by the
legislature that a statute relates to the public health, safety, or welfare does
not in itself bring the statute within the police power of a state for there must
always be an obvious and real connection between the actual provisions of
a police regulations and its avowed purpose, and the regulation adopted
must be reasonably adapted to accomplish the end sought to be attained.
Here, we see no perceptible connection or relation between the objective sought
to be attained under Resolution No. 60, s. 1988, supra, and the alleged public
safety, general welfare, etc. of the inhabitants of Makati.
Anent the second contention, let it be stressed that Resolution No. 60 is still subject
to the limitation that the expenditure covered thereby should be for a public
purpose, i.e., that the disbursement of the amount of P500.00 as burial assistance
to a bereaved family of the Municipality of Makati, or a total of P400,000.00
appropriated under the Resolution, should be for the benefit of the whole, if not the
majority, of the inhabitants of the Municipality and not for the benefit of only a few
 individuals as in the present case. On this point government funds or property shall
be spent or used solely for public purposes.

Bent on pursuing the Burial Assistance Program the Municipality of Makati, through its
Council, passed Resolution No. 243, re-affirming Resolution No. 60. However, the Burial
Assistance Program has been stayed by COA Decision No. 1159. Petitioner, through its
Mayor, was constrained to file this special civil action of certiorari praying that COA
Decision No. 1159 be set aside as null and void.
ISSUE: Whether Resolution No. 60 is a valid exercise of the police power under the
general welfare clause
RULING: 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.
A valid delegation of police power may arise from express delegation, or be inferred from
the mere fact of the creation of the municipal corporation; and as a general rule, municipal
corporations may exercise police powers within the fair intent and purpose of their
creation which are reasonably proper to give effect to the powers expressly granted, and
statutes conferring powers on public corporations have been construed as empowering
them to do the things essential to the enjoyment of life and desirable for the safety of the
people. The so-called inferred police powers of such corporations are as much delegated
powers as are those conferred in express terms, the inference of their delegation growing
out of the fact of the creation of the municipal corporation and the additional fact that the
corporation can only fully accomplish the objects of its creation by exercising such
powers. Furthermore, municipal corporations, as governmental agencies, must have
such measures of the power as are necessary to enable them to perform their
governmental functions. The power is a continuing one, founded on public necessity.
Thus, not only does the State effectuate its purposes through the exercise of the police
power but the municipality does also.
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." (Sections 91, 149, 177 and 208, BP 337). And under
Section 7 of BP 337, "every local government unit shall exercise the powers expressly
granted, those necessarily implied therefrom, as well as powers necessary and proper
for governance such as to promote health and safety, enhance prosperity, improve
morals, and maintain peace and order in the local government unit, and preserve the
comfort and convenience of the inhabitants therein."
The police power of a municipal corporation is broad, and has been said to be
commensurate with, but not to exceed, the duty to provide for the real needs of the people
in their health, safety, comfort, and convenience as consistently as may be with private
rights. It extends to all the great public needs, and, in a broad sense includes all legislation
and almost every function of the municipal government. It covers a wide scope of
subjects, and, while it is especially occupied with whatever affects the peace, security,
health, morals, and general welfare of the community, it is not limited thereto, but is
broadened to deal with conditions which exists so as to bring out of them the greatest
welfare of the people by promoting public convenience or general prosperity, and to
everything worthwhile for the preservation of comfort of the inhabitants of the corporation.
Thus, it is deemed inadvisable to attempt to frame any definition which shall absolutely
indicate the limits of police power.
COA's additional objection is based on its contention that "Resolution No. 60 is still subject
to the limitation that the expenditure covered thereby should be for a public purpose, ...
should be for the benefit of the whole, if not the majority, of the inhabitants of the
Municipality and not for the benefit of only a few individuals as in the present case."
Public purpose is not unconstitutional merely because it incidentally benefits a limited
number of persons. As correctly pointed out by the Office of the Solicitor General, "the
drift is towards social welfare legislation geared towards state policies to provide
adequate social services (Section 9, Art. II, Constitution), the promotion of the general
welfare (Section 5, Ibid) social justice (Section 10, Ibid) as well as human dignity and
respect for human rights. (Section 11, Ibid." The care for the poor is generally recognized
as a public duty. The support for the poor has long been an accepted exercise of police
power in the promotion of the common good.
There is no violation of the equal protection clause in classifying paupers as subject of
legislation. Paupers may be reasonably classified. Different groups may receive varying
treatment. Precious to the hearts of our legislators, down to our local councilors, is the
welfare of the paupers. Thus, statutes have been passed giving rights and benefits to the
disabled, emancipating the tenant-farmer from the bondage of the soil, housing the urban
poor, etc.

2. G.R. No. 166494 June 29, 2007

CARLOS SUPERDRUG CORP., doing business under the name and style "Carlos
Superdrug," ELSIE M. CANO, doing business under the name and style "Advance
Drug," Dr. SIMPLICIO L. YAP, JR., doing business under the name and style "City
Pharmacy," MELVIN S. DELA SERNA, doing business under the name and style
"Botica dela Serna," and LEYTE SERV-WELL CORP., doing business under the
name and style "Leyte Serv-Well Drugstore," petitioners, vs. DEPARTMENT OF
SOCIAL WELFARE and DEVELOPMENT (DSWD), DEPARTMENT OF HEALTH
(DOH), DEPARTMENT OF FINANCE (DOF), DEPARTMENT OF JUSTICE (DOJ), and
DEPARTMENT OF INTERIOR and LOCAL GOVERNMENT (DILG), respondents.
FACTS: On February 26, 2004, R.A. No. 9257, amending R.A. No. 7432,3 was signed
into law by President Gloria Macapagal-Arroyo and it became effective on March 21,
2004. Section 4(a) of the Act states granting 20% discount for senior citizens from various
services and establishments. The establishment may claim the discounts granted under
(a), (f), (g) and (h) as tax deduction based on the net cost of the goods sold or services
rendered: Provided, That the cost of the discount shall be allowed as deduction from
gross income for the same taxable year that the discount is granted. Provided, further,
That the total amount of the claimed tax deduction net of value added tax if applicable,
shall be included in their gross sales receipts for tax purposes and shall be subject to
proper documentation and to the provisions of the National Internal Revenue Code, as
amended.
On May 28, 2004, the DSWD approved and adopted the Implementing Rules and
Regulations of R.A. No. 9257, Rule VI, Article 8 of which states:
Article 8. Tax Deduction of Establishments. – The establishment may claim the
discounts granted under Rule V, Section 4 – Discounts for Establishments;5
Section 9, Medical and Dental Services in Private Facilities[,]6 and Sections 107
and 118 – Air, Sea and Land Transportation as tax deduction based on the net
cost of the goods sold or services rendered. Provided, That the cost of the discount
shall be allowed as deduction from gross income for the same taxable year that
the discount is granted; Provided, further, That the total amount of the claimed tax
deduction net of value added tax if applicable, shall be included in their gross sales
receipts for tax purposes and shall be subject to proper documentation and to the
provisions of the National Internal Revenue Code, as amended; Provided, finally,
that the implementation of the tax deduction shall be subject to the Revenue
Regulations to be issued by the Bureau of Internal Revenue (BIR) and approved
by the Department of Finance (DOF).
On July 10, 2004, in reference to the query of the Drug Stores Association of the
Philippines (DSAP) concerning the meaning of a tax deduction under the Expanded
Senior Citizens Act.
Under this scheme, the establishment concerned is allowed to deduct from gross income,
in computing for its tax liability, the amount of discounts granted to senior citizens.
Effectively, the government loses in terms of foregone revenues an amount equivalent to
the marginal tax rate the said establishment is liable to pay the government. This will be
an amount equivalent to 32% of the twenty percent (20%) discounts so granted. The
establishment shoulders the remaining portion of the granted discounts.
It may be necessary to note that while the burden on [the] government is slightly
diminished in terms of its percentage share on the discounts granted to senior citizens,
the number of potential establishments that may claim tax deductions, have however,
been broadened. Aside from the establishments that may claim tax credits under the old
law, more establishments were added under the new law such as: establishments
providing medical and dental services, diagnostic and laboratory services, including
professional fees of attending doctors in all private hospitals and medical facilities,
operators of domestic air and sea transport services, public railways and skyways and
bus transport services.
Under the tax deduction scheme, the tax deduction on discounts was subtracted from Net
Sales together with other deductions which are considered as operating expenses before
the Tax Due was computed based on the Net Taxable Income. On the other hand, under
a tax credit scheme, the amount of discounts which is the tax credit item, was deducted
directly from the tax due amount.
On October 1, 2004, Administrative Order (A.O.) No. 171 or the Policies and Guidelines
to Implement the Relevant Provisions of Republic Act 9257, otherwise known as the
"Expanded Senior Citizens Act of 2003"11 was issued by the DOH, providing the grant of
twenty percent (20%) discount in the purchase of unbranded generic medicines from all
establishments dispensing medicines for the exclusive use of the senior citizens.
On November 12, 2004, the DOH issued Administrative Order No 17712 amending A.O.
No. 171. Under A.O. No. 177, the twenty percent discount shall not be limited to the
purchase of unbranded generic medicines only, but shall extend to both prescription and
non-prescription medicines whether branded or generic. Thus, it stated that "[t]he grant
of twenty percent (20%) discount shall be provided in the purchase of medicines from all
establishments dispensing medicines for the exclusive use of the senior citizens."
ISSUE: Whether or not the tax deduction scheme as a reimbursement mechanism for the
twenty percent (20%) discount that petitioners extend to senior citizens is valid.
RULING: Based on the DOF Opinion, the tax deduction scheme does not fully reimburse
petitioners for the discount privilege accorded to senior citizens. This is because the
discount is treated as a deduction, a tax-deductible expense that is subtracted from the
gross income and results in a lower taxable income. Stated otherwise, it is an amount
that is allowed by law15 to reduce the income prior to the application of the tax rate to
compute the amount of tax which is due.16 Being a tax deduction, the discount does not
reduce taxes owed on a peso for peso basis but merely offers a fractional reduction in
taxes owed.
The permanent reduction in their total revenues is a forced subsidy corresponding to the
taking of private property for public use or benefit. This constitutes compensable taking
for which petitioners would ordinarily become entitled to a just compensation.
Just compensation is defined as the full and fair equivalent of the property taken from its
owner by the expropriator. The measure is not the taker’s gain but the owner’s loss. The
word just is used to intensify the meaning of the word compensation, and to convey the
idea that the equivalent to be rendered for the property to be taken shall be real,
substantial, full and ample.18
A tax deduction does not offer full reimbursement of the senior citizen discount. As such,
it would not meet the definition of just compensation.

3. G.R. No. 126102 December 4, 2000

ORTIGAS & CO. LTD., petitioner, vs. THE COURT OF APPEALS and ISMAEL G.
MATHAY III, respondents.
FACTS: On August 25, 1976, petitioner Ortigas & Company sold to Emilia Hermoso, a
parcel of land known as Lot 1, Block 21, Psd-66759, with an area of 1,508 square meters,
located in Greenhills Subdivision IV, San Juan, Metro Manila, and covered by Transfer
Certificate of Title No. 0737. The contract of sale provided that the lot be used exclusively
for residential purposes only, and not more than one single-family residential building will
be constructed thereon and that the BUYER shall not erect any sign or billboard on the
roof for advertising purpose, among others.
In 1981, the Metropolitan Manila Commission (now Metropolitan Manila Development
Authority) enacted MMC Ordinance No. 81-01, also known as the Comprehensive Zoning
Area for the National Capital Region. The ordinance reclassified as a commercial area a
portion of Ortigas Avenue from Madison to Roosevelt Streets of Greenhills Subdivision
where the lot is located.
On June 8, 1984, private respondent Ismael Mathay III leased the lot from Emilia Hermoso
and J.P. Hermoso Realty Corp.. The lease contract did not specify the purposes of the
lease. Thereupon, private respondent constructed a single story commercial building for
Greenhills Autohaus, Inc., a car sales company.
On January 18, 1995, petitioner filed a complaint against Emilia Hermoso with the
Regional Trial Court of Pasig. The complaint sought the demolition of the said commercial
structure for having violated the terms and conditions of the Deed of Sale. Complainant
prayed for the issuance of a temporary restraining order and a writ of preliminary
injunction to prohibit petitioner from constructing the commercial building and/or engaging
in commercial activity on the lot. The complaint was later amended to implead Ismael G.
Mathay III and J.P. Hermoso Realty Corp., which has a ten percent (10%) interest in the
lot.
In his answer, Mathay III denied any knowledge of the restrictions on the use of the lot
and filed a cross-claim against the Hermosos.
Mathay III then filed with the Court of Appeals a special civil action for certiorari ascribing
to the trial court grave abuse of discretion in issuing the writ of preliminary injunction. He
claimed that MMC Ordinance No. 81-01 classified the area where the lot was located as
commercial area and said ordinance must be read into the August 25, 1976 Deed of Sale
as a concrete exercise of police power.
Ortigas and Company averred that inasmuch as the restrictions on the use of the lot were
duly annotated on the title it issued to Emilia Hermoso, said restrictions must prevail over
the ordinance, especially since these restrictions were agreed upon before the passage
of MMC Ordinance No. 81-01.
In finding for Mathay III, the Court of Appeals held that the MMC Ordinance No. 81-01
effectively nullified the restrictions allowing only residential use of the property in question.
ISSUE: Whether or not the zoning ordinance may impair contracts entered prior to its
effectivity
RULING: In general, we agree that laws are to be construed as having only prospective
operation. Lex prospicit, non respicit. Equally settled, only laws existing at the time of the
execution of a contract are applicable thereto and not later statutes, unless the latter are
specifically intended to have retroactive effect.7 A later law which enlarges, abridges, or
in any manner changes the intent of the parties to the contract necessarily impairs the
contract itself and cannot be given retroactive effect without violating the constitutional
prohibition against impairment of contracts.
But, the foregoing principles do admit of certain exceptions. One involves police power.
A law enacted in the exercise of police power to regulate or govern certain activities or
transactions could be given retroactive effect and may reasonably impair vested rights or
contracts. Police power legislation is applicable not only to future contracts, but equally
to those already in existence. Non impairment of contracts or vested rights clauses will
have to yield to the superior and legitimate exercise by the State of police power to
promote the health, morals, peace, education, good order, safety, and general welfare of
the people.
While our legal system upholds the sanctity of contract so that a contract is deemed law
between the contracting parties, nonetheless, stipulations in a contract cannot contravene
"law, morals, good customs, public order, or public policy."18 Otherwise such stipulations
would be deemed null and void. Respondent court correctly found that the trial court
committed in this case a grave abuse of discretion amounting to want of or excess of
jurisdiction in refusing to treat Ordinance No. 81-01 as applicable to Civil Case No. 64931.
In resolving matters in litigation, judges are not only duty-bound to ascertain the facts and
the applicable laws, they are also bound by their oath of office to apply the applicable law.

4. G.R. No. 135962 March 27, 2000

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner, vs. BEL-AIR
VILLAGE ASSOCIATION, INC., respondent.
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 a notice requesting
respondent to open Neptune Street to public vehicular traffic starting January 2, 1996.
The notice requested BAVA to voluntarily open the points of entry and exit on Neptune
street.
On the same day, respondent was apprised that the perimeter wall separating the
subdivision from the adjacent Kalayaan Avenue would be demolished.
On January 2, 1996, respondent instituted against petitioner before the Regional Trial
Court Makati City, for injunction. Respondent prayed for the issuance of a temporary
restraining order and preliminary injunction enjoining the opening of Neptune Street and
prohibiting the demolition of the perimeter wall. The trial court issued a temporary
restraining order the following day.
On January 23, 1996, after due hearing, the trial court denied issuance of a preliminary
injunction. Respondent questioned the denial before the Court of Appeals in CA-G.R. SP
No. 39549. The appellate court conducted an ocular inspection of Neptune Street 3 and
on February 13, 1996, it issued a writ of preliminary injunction enjoining the
implementation of the MMDA's proposed action.
On January 28, 1997, the appellate court rendered a Decision on the merits of the case
finding that the MMDA has no authority to order the opening of Neptune Street, a private
subdivision road and cause the demolition of its perimeter walls.
ISSUE: Whether or not the MMDA have the mandate to open Neptune Street to public
traffic pursuant to its regulatory and police powers
RULING: No. Police power is an inherent attribute of sovereignty. It has been defined as
the power vested by the Constitution in the legislature to make, ordain, and establish all
manner of wholesome and reasonable laws, statutes and ordinances, either with
penalties or without, not repugnant to the Constitution, as they shall judge to be for the
good and welfare of the commonwealth, and for the subjects of the same. The power is
plenary and its scope is vast and pervasive, reaching and justifying measures for public
health, public safety, public morals, and the general welfare.
It bears stressing that police power is lodged primarily in the National Legislature. It
cannot be exercised by any group or body of individuals not possessing legislative power.
The National Legislature, however, may delegate this power to the President and
administrative boards as well as the lawmaking bodies of municipal corporations or local
government units. Once delegated, the agents can exercise only such legislative powers
as are conferred on them by the national law making body.
A local government is a "political subdivision of a nation or state which is constituted by
law and has substantial control of local affairs." The Local Government Code of 1991
defines a local government unit as a "body politic and corporate." — one endowed with
powers as a political subdivision of the National Government and as a corporate entity
representing the inhabitants of its territory. 18 Local government units are the provinces,
cities, municipalities and barangays. 19 They are also the territorial and political
subdivisions of the state.
Clearly, the scope of the MMDA's function is limited to the delivery of the seven (7) basic
services. One of these is transport and traffic management which includes the formulation
and monitoring of policies, standards and projects to rationalize the existing transport
operations, infrastructure requirements, the use of thoroughfares and promotion of the
safe movement of persons and goods. It also covers the mass transport system and the
institution of a system of road regulation, the administration of all traffic enforcement
operations, traffic engineering services and traffic education programs, including the
institution of a single ticketing system in Metro Manila for traffic violations. Under the
service, the MMDA is expressly authorized "to set the policies concerning traffic" and
"coordinate and regulate the implementation of all traffic management programs." In
addition, the MMDA may "install and administer a single ticketing system," fix, impose
and collect fines and penalties for all traffic violations.
It will be noted that 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. Even the
Metro Manila Council has not been delegated any legislative power. Unlike the legislative
bodies of the local government units, there is no provision in R.A. No. 7924 that empowers
the MMDA or its Council to "enact ordinances, approve resolutions appropriate funds for
the general welfare" of the inhabitants of Metro Manila. The MMDA is, as termed in the
charter itself, "development authority." It is an agency created for the purpose of laying
down policies and coordinating with the various national government agencies, people's
organizations, non-governmental organizations and the private sector for the efficient and
expeditious delivery of basic services in the vast metropolitan area.

5. G.R. No. 118127 April 12, 2005

CITY OF MANILA, HON. ALFREDO S. LIM as the Mayor of the City of Manila, HON.
JOSELITO L. ATIENZA, in his capacity as Vice-Mayor of the City of Manila and
Presiding Officer of the City Council of Manila, HON. ERNESTO A. NIEVA, HON.
GONZALO P. GONZALES, HON. AVELINO S. CAILIAN, HON. ROBERTO C.
OCAMPO, HON. ALBERTO DOMINGO, HON. HONORIO U. LOPEZ, HON.
FRANCISCO G. VARONA, JR., HON. ROMUALDO S. MARANAN, HON. NESTOR C.
PONCE, JR., HON. HUMBERTO B. BASCO, HON. FLAVIANO F. CONCEPCION, JR.,
HON. ROMEO G. RIVERA, HON. MANUEL M. ZARCAL, HON. PEDRO S. DE JESUS,
HON. BERNARDITO C. ANG, HON. MANUEL L. QUIN, HON. JHOSEP Y. LOPEZ,
HON. CHIKA G. GO, HON. VICTORIANO A. MELENDEZ, HON. ERNESTO V.P.
MACEDA, JR., HON. ROLANDO P. NIETO, HON. DANILO V. ROLEDA, HON. GERINO
A. TOLENTINO, JR., HON. MA. PAZ E. HERRERA, HON. JOEY D. HIZON, HON.
FELIXBERTO D. ESPIRITU, HON. KARLO Q. BUTIONG, HON. ROGELIO P. DELA
PAZ, HON. BERNARDO D. RAGAZA, HON. MA. CORAZON R. CABALLES, HON.
CASIMIRO C. SISON, HON. BIENVINIDO M. ABANTE, JR., HON. MA. LOURDES M.
ISIP, HON. ALEXANDER S. RICAFORT, HON. ERNESTO F. RIVERA, HON.
LEONARDO L. ANGAT, and HON. JOCELYN B. DAWIS, in their capacity as
councilors of the City of Manila, Petitioner, vs. HON. PERFECTO A.S. LAGUIO, JR.,
as Presiding Judge, RTC, Manila and MALATE TOURIST DEVELOPMENT
CORPORATION, Respondents.
FACTS: Malate Tourist Development Corporation (MTDC) is a corporation engaged in
the business of operating hotels, motels, hostels and lodging houses. It built and opened
Victoria Court in Malate which was licensed as a motel although duly accredited with the
Department of Tourism as a hotel. On 28 June 1993, MTDC filed a Petition for Declaratory
Relief with Prayer for a Writ of Preliminary Injunction and/or Temporary Restraining Order
(RTC Petition) with the lower court impleading as defendants, herein petitioners City of
Manila, Hon. Alfredo S. Lim (Lim), Hon. Joselito L. Atienza, and the members of the City
Council of Manila (City Council). MTDC prayed that Ordinance No. 7783 insofar as it
includes motels and inns as among its prohibited establishments, be declared invalid and
unconstitutional.
Enacted by the City Council and approved by petitioner City Mayor, the said Ordinance
provides that no one shall be allowed or authorized to contract and engage in, any
business providing certain forms of amusement, entertainment, services and facilities
where women are used as tools in entertainment and which tend to disturb the
community, annoy the inhabitants, and adversely affect the social and moral welfare of
the community, such as but not limited to: Sauna Parlors, Massage Parlors, Karaoke
Bars, Beerhouses, Night Clubs, Day Clubs, Super Clubs, Discotheques, Cabarets,
Dance Halls, Motels, Inns.
It likewise provides that the City Mayor, the City Treasurer or any person acting in behalf
of the said officials are prohibited from issuing permits, temporary or otherwise, or from
granting licenses and accepting payments for the operation of business enumerated and
the owners and/or operator of establishments engaged in, or devoted to, the businesses
enumerated are given three (3) months to wind up business operations or to transfer to
any place outside of the Ermita-Malate area or convert said businesses to other kinds of
business allowable within the area.
In the RTC Petition, MTDC argued that the Ordinance erroneously and improperly
included in its enumeration of prohibited establishments, motels and inns such as MTDC's
Victoria Court considering that these were not establishments for "amusement" or
"entertainment" and they were not "services or facilities for entertainment," nor did they
use women as "tools for entertainment," and neither did they "disturb the community,"
"annoy the inhabitants" or "adversely affect the social and moral welfare of the
community."
MTDC further advanced that the Ordinance was invalid and unconstitutional for the
following reasons: (1) The City Council has no power to prohibit the operation of motels
as Section 458 (a) 4 (iv)12 of the Local Government Code of 1991 (the Code) grants to
the City Council only the power to regulate the establishment, operation and maintenance
of hotels, motels, inns, pension houses, lodging houses and other similar establishments;
(2) The Ordinance is void as it is violative of Presidential Decree (P.D.) No. 49913 which
specifically declared portions of the Ermita-Malate area as a commercial zone with certain
restrictions; (3) The Ordinance does not constitute a proper exercise of police power as
the compulsory closure of the motel business has no reasonable relation to the legitimate
municipal interests sought to be protected; (4) The Ordinance constitutes an ex post facto
law by punishing the operation of Victoria Court which was a legitimate business prior to
its enactment; (5) The Ordinance violates MTDC's constitutional rights in that: (a) it is
confiscatory and constitutes an invasion of plaintiff's property rights; (b) the City Council
has no power to find as a fact that a particular thing is a nuisance per se nor does it have
the power to extrajudicially destroy it; and (6) The Ordinance constitutes a denial of equal
protection under the law as no reasonable basis exists for prohibiting the operation of
motels and inns, but not pension houses, hotels, lodging houses or other similar
establishments, and for prohibiting said business in the Ermita-Malate area but not
outside of this area.
In their Answer, City of Manila and Lim maintained that the City Council had the power to
"prohibit certain forms of entertainment in order to protect the social and moral welfare of
the community" as provided for in Section 458 (a) 4 (vii) of the Local Government Code,16
which reads, thus:
Section 458. Powers, Duties, Functions and Compensation. (a) The sangguniang
panlungsod, as the legislative body of the city, shall enact ordinances, approve
resolutions and appropriate funds for the general welfare of the city and its
inhabitants pursuant to Section 16 of this Code and in the proper exercise of the
corporate powers of the city as provided for under Section 22 of this Code, and
shall:
(4) Regulate activities relative to the use of land, buildings and structures within
the city in order to promote the general welfare and for said purpose shall:
(vii) Regulate the establishment, operation, and maintenance of any entertainment
or amusement facilities, including theatrical performances, circuses, billiard pools,
public dancing schools, public dance halls, sauna baths, massage parlors, and
other places for entertainment or amusement; regulate such other events or
activities for amusement or entertainment, particularly those which tend to disturb
the community or annoy the inhabitants, or require the suspension or suppression
of the same; or, prohibit certain forms of amusement or entertainment in order to
protect the social and moral welfare of the community.
Petitioners insisted that the power of regulation spoken of in the above-quoted provision
included the power to control, to govern and to restrain places of exhibition and
amusement.18
Petitioners likewise asserted that the Ordinance was enacted by the City Council of
Manila to protect the social and moral welfare of the community in conjunction with its
police power as found in Article III, Section 18(kk) of Republic Act No. 409, otherwise
known as the Revised Charter of the City of Manila (Revised Charter of Manila)20 which
reads, thus:
ARTICLE III THE MUNICIPAL BOARD
Section 18. Legislative powers. – The Municipal Board shall have the following
legislative powers:
(kk) To enact all ordinances it may deem necessary and proper for the sanitation
and safety, the furtherance of the prosperity, and the promotion of the morality,
peace, good order, comfort, convenience, and general welfare of the city and its
inhabitants, and such others as may be necessary to carry into effect and
discharge the powers and duties conferred by this chapter; and to fix penalties for
the violation of ordinances which shall not exceed two hundred pesos fine or six
months' imprisonment, or both such fine and imprisonment, for a single offense.
Further, the petitioners noted, the Ordinance had the presumption of validity; hence,
private respondent had the burden to prove its illegality or unconstitutionality.
Petitioners also maintained that there was no inconsistency between P.D. 499 and the
Ordinance as the latter simply disauthorized certain forms of businesses and allowed the
Ermita-Malate area to remain a commercial zone. The Ordinance, the petitioners likewise
claimed, cannot be assailed as ex post facto as it was prospective in operation. The
Ordinance also did not infringe the equal protection clause and cannot be denounced as
class legislation as there existed substantial and real differences between the Ermita-
Malate area and other places in the City of Manila.
On 28 June 1993, respondent Judge Perfecto A.S. Laguio, Jr. (Judge Laguio) issued an
ex-parte temporary restraining order against the enforcement of the Ordinance. And again
in an intrepid gesture, he granted the writ of preliminary injunction prayed for by MTDC.
After trial, Judge Laguio rendered the assailed Decision, enjoining the petitioners from
implementing the Ordinance.
Petitioners filed the present Petition, alleging that the following errors were committed by
the lower court in its ruling: (1) It erred in concluding that the subject ordinance is ultra
vires, or otherwise, unfair, unreasonable and oppressive exercise of police power; (2) It
erred in holding that the questioned Ordinance contravenes P.D. 49931 which allows
operators of all kinds of commercial establishments, except those specified therein; and
(3) It erred in declaring the Ordinance void and unconstitutional.
ISSUE: Whether or not the Ordinance is ultra vires and that it is void for being repugnant
to the general law. It reiterates that the questioned Ordinance is not a valid exercise of
police power
RULING: The Court is of the opinion, and so holds, that the lower court did not err in
declaring the Ordinance, as it did, ultra vires and therefore null and void.
The Ordinance is so replete with constitutional infirmities that almost every sentence
thereof violates a constitutional provision. The prohibitions and sanctions therein
transgress the cardinal rights of persons enshrined by the Constitution. The Court is
called upon to shelter these rights from attempts at rendering them worthless.
The tests of a valid ordinance are well established. A long line of decisions has held 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.
Anent the first criterion, ordinances shall only be valid when they are not contrary to the
Constitution and to the laws. The Ordinance must satisfy two requirements: it must pass
muster under the test of constitutionality and the test of consistency with the prevailing
laws. That ordinances should be constitutional uphold the principle of the supremacy of
the Constitution. The requirement that the enactment must not violate existing law gives
stress to the precept that local government units are able to legislate only by virtue of their
derivative legislative power, a delegation of legislative power from the national legislature.
The delegate cannot be superior to the principal or exercise powers higher than those of
the latter.
This relationship between the national legislature and the local government units has not
been enfeebled by the new provisions in the Constitution strengthening the policy of local
autonomy. The national legislature is still the principal of the local government units, which
cannot defy its will or modify or violate it.
The Ordinance was passed by the City Council in the exercise of its police power, an
enactment of the City Council acting as agent of Congress. Local government units, as
agencies of the State, are endowed with police power in order to effectively accomplish
and carry out the declared objects of their creation.
Local government units exercise police power through their respective legislative bodies;
in this case, the sangguniang panlungsod or the city council. The Code empowers the
legislative bodies to "enact ordinances, approve resolutions and appropriate funds for the
general welfare of the province/city/municipality and its inhabitants pursuant to Section
16 of the Code and in the proper exercise of the corporate powers of the province/city/
municipality provided under the Code.
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.

6. G.R. No. 100152 March 31, 2000

ACEBEDO OPTICAL COMPANY, INC., petitioner, vs. THE HONORABLE COURT OF
APPEALS, Hon. MAMINDIARA MANGOTARA, in his capacity as Presiding Judge of
the RTC, 12th Judicial Region, Br. 1, Iligan City; SAMAHANG OPTOMETRIST Sa
PILIPINAS — Iligan City Chapter, LEO T. CAHANAP, City Legal Officer, and Hon.
CAMILO P. CABILI, City Mayor of Iligan, respondents.
FACTS: Petitioner applied with the Office of the City Mayor of Iligan for a business permit.
After consideration of petitioner's application and the opposition interposed thereto by
local optometrists, respondent City Mayor issued Business Permit No. 5342 subject to
the following conditions:
1. Since it is a corporation, Acebedo cannot put up an optical clinic but only a
commercial store;
2. Acebedo cannot examine and/or prescribe reading and similar optical glasses
for patients, because these are functions of optical clinics;
3. Acebedo cannot sell reading and similar eyeglasses without a prescription
having first been made by an independent optometrist (not its employee) or
independent optical clinic. Acebedo can only sell directly to the public, without need
of a prescription, Ray-Ban and similar eyeglasses;
4. Acebedo cannot advertise optical lenses and eyeglasses, but can advertise
Ray-Ban and similar glasses and frames;
5. Acebedo is allowed to grind lenses but only upon the prescription of an
independent optometrist.
Private respondent Samahan ng Optometrist Sa Pilipinas (SOPI), Iligan Chapter lodged
a complaint against the petitioner before the Office of the City Mayor, alleging that
Acebedo had violated the conditions set forth in its business permit and requesting the
cancellation and/or revocation of such permit.
Acting on such complaint, then City Mayor Camilo P. Cabili designated City Legal Officer
Leo T. Cahanap to conduct an investigation on the matter. Respondent City Legal Officer
submitted a report to the City Mayor finding the herein petitioner guilty of violating all the
conditions of its business permit and recommending the disqualification of petitioner from
operating its business in Iligan City. The report further advised that no new permit shall
be granted to petitioner for the year 1989 and should only be given time to wind up its
affairs.
The City Mayor sent petitioner a Notice of Resolution and Cancellation of Business Permit
effective as of said date and giving petitioner three (3) months to wind up its affairs.
Petitioner brought a petition for certiorari, prohibition and mandamus with prayer for
restraining order/preliminary injunction against the respondents, City Mayor, City Legal
Officer and Samahan ng Optometrists sa Pilipinas-Iligan City Chapter (SOPI), before the
Regional Trial Court of Iligan City. Petitioner alleged that (1) it was denied due process
because it was not given an opportunity to present its evidence during the investigation
conducted by the City Legal Officer; (2) it was denied equal protection of the laws as the
limitations imposed on its business permit were not imposed on similar businesses in
Iligan City; (3) the City Mayor had no authority to impose the special conditions on its
business permit; and (4) the City Legal Officer had no authority to conduct the
investigation as the matter falls within the exclusive jurisdiction of the Professional
Regulation Commission and the Board of Optometry.
Respondent SOPI interposed a Motion to Dismiss the Petition on the ground of non-
exhaustion of administrative remedies but on November 24, 1989, Presiding Judge
Mamindiara P. Mangotara deferred resolution of such Motion to Dismiss until after trial of
the case on the merits. However, the prayer for a writ of preliminary injunction was
granted. Thereafter, respondent SOPI filed its answer.
The trial court dismissed the petition for failure to exhaust administrative remedies, and
dissolved the writ of preliminary injunction it earlier issued. Petitioner's motion for
reconsideration met the same fate. It was denied by an Order.
Instead of taking an appeal, petitioner filed a petition for certiorari, prohibition and
mandamus with the Court of Appeals seeking to set aside the questioned Order of
Dismissal, branding the same as tainted with grave abuse of discretion on the part of the
trial court. The Ninth Division of the Court of Appeals dismissed the petition for lack of
merit.
ISSUE: Whether the City Mayor has the authority to impose special conditions, as a valid
exercise of police power, in the grant of business permits
RULING: Police power as an inherent attribute of sovereignty is the power to prescribe
regulations to promote the health, morals, peace, education, good order or safety and
general welfare of the people. The State, through the legislature, has delegated the
exercise of police power to local government units, as agencies of the State, in order to
effectively accomplish and carry out the declared objects of their creation. This delegation
of police power is embodied in the general welfare clause of the Local Government Code
which provides:
Sec. 6. General Welfare. — Every local government unit shall exercise the powers
expressly granted, those necessarily implied therefrom, as well as powers
necessary, appropriate, or incidental for its efficient and effective governance, and
those which are essential to the promotion of the general welfare. Within their
respective territorial jurisdictions, local government units shall ensure and support,
among other things, the preservation and enrichment of culture, promote health
and safety, enhance the right of the people to a balanced ecology, encourage and
support the development of appropriate and self-reliant scientific and technological
capabilities, improve public morals, enhance economic prosperity and social
justice, promote full employment among their residents, maintain peace and order,
and preserve the comfort and convenience of their inhabitants.
The scope of police power has been held to be so comprehensive as to encompass
almost all matters affecting the health, safety, peace, order, morals, comfort and
convenience of the community. Police power is essentially regulatory in nature and the
power to issue licenses or grant business permits, if exercised for a regulatory and not
revenue-raising purpose, is within the ambit of this power.
The authority of city mayors to issue or grant licenses and business permits is beyond
cavil. It is provided for by law. Section 171, paragraph 2 (n) of Batas Pambansa Bilang
337 otherwise known as the Local Government Code of 1983, reads:
Sec. 171. The City Mayor shall:
n) Grant or refuse to grant, pursuant to law, city licenses or permits, and revoke
the same for violation of law or ordinance or the conditions upon which they are
granted.
However, the power to grant or issue licenses or business permits must always be
exercised in accordance with law, with utmost observance of the rights of all concerned
to due process and equal protection of the law.
Succinct and in point is the ruling of this Court, that:
. . . While a business may be regulated, such regulation must, however, be within
the bounds of reason, i.e., the regulatory ordinance must be reasonable, and its
 provision cannot be oppressive amounting to an arbitrary interference with the
business or calling subject of regulation. A lawful business or calling may not,
under the guise of regulation, be unreasonably interfered with even by the exercise
of police power. . . .
. . . The exercise of police power by the local government is valid unless it
contravenes the fundamental law of the land or an act of the legislature, or unless
it is against public policy or is unreasonable, oppressive, partial, discriminating or
in derogation of a common right.
In the case, the business permit granted by respondent City Mayor to petitioner was
burdened with several conditions. Petitioner agrees with the holding by the Court of
Appeals that respondent City Mayor acted beyond his authority in imposing such special
conditions in its permit as the same have no basis in the law or ordinance.
The power to issue licenses and permits necessarily includes the corollary power to
revoke, withdraw or cancel the same. And the power to revoke or cancel, likewise includes
the power to restrict through the imposition of certain conditions. However, the present
inquiry does not stop there, as the Solicitor General believes. The power or authority of
the City Mayor to impose conditions or restrictions in the business permit is indisputable.
What petitioner assails are the conditions imposed in its particular case which, it
complains, amount to a confiscation of the business in which petitioner is engaged.
Distinction must be made between the grant of a license or permit to do business and the
issuance of a license to engage in the practice of a particular profession. The first is
usually granted by the local authorities and the second is issued by the Board or
Commission tasked to regulate the particular profession. A business permit authorizes
the person, natural or otherwise, to engage in business or some form of commercial
activity. A professional license, on the other hand, is the grant of authority to a natural
person to engage in the practice or exercise of his or her profession.
In the case at bar, what is sought by petitioner from respondent City Mayor is a permit to
engage in the business of running an optical shop. It does not purport to seek a license
to engage in the practice of optometry as a corporate body or entity, although it does have
in its employ, persons who are duly licensed to practice optometry by the Board of
Examiners in Optometry.
The objective of the imposition of subject conditions on petitioner's business permit could
be attained by requiring the optometrists in petitioner's employ to produce a valid
certificate of registration as optometrist, from the Board of Examiners in Optometry. A
business permit is issued primarily to regulate the conduct of business and the City Mayor
cannot, through the issuance of such permit, regulate the practice of a profession, like
that of optometry. Such a function is within the exclusive domain of the administrative
agency specifically empowered by law to supervise the profession, in this case the
Professional Regulations Commission and the Board of Examiners in Optometry.
To accomplish the objective of the regulation, a state may provide by statute that
corporations cannot sell eyeglasses, spectacles, and lenses unless a duly licensed
physician or a duly qualified optometrist is in charge of, and in personal attendance at the
place where such articles are sold. In such a case, the patient's primary and essential
safeguard lies in the optometrist's control of the "treatment" by means of prescription and
preliminary and final examination.
Thus, respondents' submission that the imposition of subject special conditions on
petitioner's business permit is not ultra vires cannot prevail over the finding and ruling by
the Court of Appeals from which they (respondents) did not appeal.

7. G.R. No. L-59234 September 30, 1982

TAXICAB OPERATORS OF METRO MANILA, INC., FELICISIMO CABIGAO and ACE
TRANSPORTATION CORPORATION, petitioners, vs. THE BOARD OF
TRANSPORTATION and THE DIRECTOR OF THE BUREAU OF LAND
TRANSPORTATION, respondents.
FACTS: On October 10, 1977, respondent Board of Transportation (BOT) issued
Memorandum Circular No. 77-42 Phasing out and Replacement of Old and Dilapidated
Taxis.
Pursuant to the above BOT circular, respondent Director of the Bureau of Land
Transportation (BLT) issued Implementing Circular No. 52, instructing the Regional
Director, the MV Registrars and other personnel of BLT, all within the National Capitol
Region, to implement said Circular, and formulating a schedule of phase-out of vehicles
to be allowed and accepted for registration as public conveyances.
Pursuant to BOT Memo-Circular No. 77-42, taxi units with year models over six (6) years
old are now banned from operating as public utilities in Metro Manila. As such the units
involved should be considered as automatically dropped as public utilities and, therefore,
do not require any further dropping order from the BOT.
Henceforth, taxi units within the National Capitol Region having year models over 6 years
old shall be refused registration.
On January 27, 1981, petitioners filed a Petition with the BOT seeking to nullify MC No.
77-42 or to stop its implementation; to allow the registration and operation in 1981 and
subsequent years of taxicabs of model 1974, as well as those of earlier models which
were phased-out, provided that, at the time of registration, they are roadworthy and fit for
operation.
On February 16, 1981, petitioners filed before the BOT a "Manifestation and Urgent
Motion", praying for an early hearing of their petition. The case was heard on February
20, 1981. Petitioners presented testimonial and documentary evidence, offered the same,
and manifested that they would submit additional documentary proofs. Said proofs were
submitted on March 27, 1981 attached to petitioners' pleading entitled, "Manifestation,
Presentation of Additional Evidence and Submission of the Case for Resolution."
On November 28, 1981, petitioners filed before the same Board a "Manifestation and
Urgent Motion to Resolve or Decide Main Petition" praying that the case be resolved or
decided not later than December 10, 1981 to enable them, in case of denial, to avail of
whatever remedy they may have under the law for the protection of their interests before
their 1975 model cabs are phased-out on January 1, 1982. Petitioners, through its
President, allegedly made personal follow-ups of the case, but was later informed that the
records of the case could not be located.
On December 29, 1981, the present Petition was instituted wherein the following queries
were posed for consideration by this Court.
ISSUE: Whether or not the constitutional guarantee of due process was denied to the
taxicab operators and/or other persons affected by the assailed Circular No. 52.
RULING: The Board's reason for enforcing the Circular initially in Metro Manila is that
taxicabs in this city, compared to those of other places, are subjected to heavier traffic
pressure and more constant use. This is of common knowledge. Considering that traffic
conditions are not the same in every city, a substantial distinction exists so that
infringement of the equal protection clause can hardly be successfully claimed.
As enunciated in the preambular clauses of the challenged BOT Circular, the overriding
consideration is the safety and comfort of the riding public from the dangers posed by old
and dilapidated taxis. The State, in the exercise, of its police power, can prescribe
regulations to promote the health, morals, peace, good order, safety and general welfare
of the people. It can prohibit all things hurtful to comfort, safety and welfare of society. 5
It may also regulate property rights. 6 In the language of Chief Justice Enrique M.
Fernando "the necessities imposed by public welfare may justify the exercise of
governmental authority to regulate even if thereby certain groups may plausibly assert
that their interests are disregarded". 7
In so far as the non-application of the assailed Circulars to other transportation services
is concerned, it need only be recalled that the equal protection clause does not imply that
the same treatment be accorded all and sundry. It applies to things or persons Identically
or similarly situated. It permits of classification of the object or subject of the law provided
classification is reasonable or based on substantial distinction, which make for real
differences, and that it must apply equally to each member of the class. 8 What is required
under the equal protection clause is the uniform operation by legal means so that all
persons under Identical or similar circumstance would be accorded the same treatment
both in privilege conferred and the liabilities imposed. 9 The challenged Circulars satisfy
the foregoing criteria.
Evident then is the conclusion that the questioned Circulars do not suffer from any
constitutional infirmity. To declare a law unconstitutional, the infringement of constitutional
right must be clear, categorical and undeniable.

8. G.R. No. L-24153 February 14, 1983

TOMAS VELASCO, LOURDES RAMIREZ, SY PIN, EDMUNDO UNSON, APOLONIA
RAMIREZ and LOURDES LOMIBAO, as component members of the STA. CRUZ
BARBERSHOP ASSOCIATION, in their own behalf and in representation of the
other owners of barbershops in the City of Manila, petitioners-appellants, vs. HON.
ANTONIO J. VILLEGAS, City Mayor of Manila, HON. HERMINIO A. ASTORGA, Vice-
Mayor and Presiding Officer of the Municipal Board in relation to Republic Act 4065,
THE MUNICIPAL BOARD OF THE CITY OF MANILA and EDUARDO QUINTOS SR.,
Chief of Police of the City of Manila, respondents-appellees..
FACTS: This is an appeal from an order of the lower court dismissing a suit for declaratory
relief challenging the constitutionality based on Ordinance No. 4964 of the City of Manila,
the contention being that it amounts to a deprivation of property of petitioners-appellants
of their means of livelihood without due process of law. The assailed ordinance is worded
thus: "It shall be prohibited for any operator of any barber shop to conduct the business
of massaging customers or other persons in any adjacent room or rooms of said barber
shop, or in any room or rooms within the same building where the barber shop is located
as long as the operator of the barber shop and the room where massaging is conducted
is the same person." As noted in the appealed order, petitioners-appellants admitted that
criminal cases for the violation of this ordinance had been previously filed and decided.
The lower court, therefore, held that a petition for declaratory relief did not lie, its
availability being dependent on there being as yet no case involving such issue having
been filed.
Even if such were not the case, the attack against the validity cannot succeed. As pointed
out in the brief of respondents-appellees, it is a police power measure. The objectives
behind its enactment are: "(1) To be able to impose payment of the license fee for
engaging in the business of massage clinic under Ordinance No. 3659 as amended by
Ordinance 4767, an entirely different measure than the ordinance regulating the business
of barbershops and, (2) in order to forestall possible immorality which might grow out of
the construction of separate rooms for massage of customers." This Court has been most
liberal in sustaining ordinances based on the general welfare clause. As far back as U.S.
v. Salaveria, a 1918 decision, this Court through Justice Malcolm made clear the
significance and scope of such a clause, which "delegates in statutory form the police
power to a municipality. As above stated, this clause has been given wide application by
municipal authorities and has in its relation to the particular circumstances of the case
been liberally construed by the courts. Such, it is well to really is the progressive view of
Philippine jurisprudence." As it was then, so it has continued to be. 6 There is no showing,
therefore, of the unconstitutionality of such ordinance.

9. G.R. No. 111097 July 20, 1994

MAYOR PABLO P. MAGTAJAS & THE CITY OF CAGAYAN DE ORO, petitioners, vs.
PRYCE PROPERTIES CORPORATION, INC. & PHILIPPINE AMUSEMENT AND
GAMING CORPORATION, respondents.
FACTS: There was instant opposition when PAGCOR announced the opening of a casino
in Cagayan de Oro City. Civic organizations angrily denounced the project. The religious
elements echoed the objection and so did the women's groups and the youth.
Demonstrations were led by the mayor and the city legislators. The media trumpeted the
protest, describing the casino as an affront to the welfare of the city.
The trouble arose when in 1992, flush with its tremendous success in several cities,
PAGCOR decided to expand its operations to Cagayan de Oro City. To this end, it leased
a portion of a building belonging to Pryce Properties Corporation, Inc., one of the herein
private respondents, renovated and equipped the same, and prepared to inaugurate its
casino there during the Christmas season.
The reaction of the Sangguniang Panlungsod of Cagayan de Oro City was swift and
hostile. On December 7, 1992, it enacted Ordinance No. 3353 which aims to prohibit the
issuance of business permit and cancellation of existing business permit to any
establishment for the using and allowing to be used for the operation of Casino.
Pryce assailed the ordinances before the Court of Appeals, where it was joined by
PAGCOR as intervenor and supplemental petitioner. Their challenge succeeded. On
March 31, 1993, the Court of Appeals declared the ordinances invalid and issued the writ
prayed for to prohibit their enforcement. Reconsideration of this decision was denied on
July 13, 1993.
Cagayan de Oro City and its mayor are now before us in this petition for review under
Rule 45 of the Rules of Court. They aver that the respondent Court of Appeals erred in
holding that: 1. Under existing laws, the Sangguniang Panlungsod of the City of Cagayan
de Oro does not have the power and authority to prohibit the establishment and operation
of a PAGCOR gambling casino within the City's territorial limits; 2. The phrase "gambling
and other prohibited games of chance" found in Sec. 458, par. (a), sub-par. (1) — (v) of
R.A. 7160 could only mean "illegal gambling"; 3. The questioned Ordinances in effect
annul P.D. 1869 and are therefore invalid on that point; 4. The questioned Ordinances
are discriminatory to casino and partial to cockfighting and are therefore invalid on that
point; 5. The questioned Ordinances are not reasonable, not consonant with the general
powers and purposes of the instrumentality concerned and inconsistent with the laws or
policy of the State; 6. It had no option but to follow the ruling in the case of Basco, et al.
v. PAGCOR, G.R. No. 91649, May 14, 1991, 197 SCRA 53 in disposing of the issues
presented in this present case.
PAGCOR is a corporation created directly by P.D. 1869 to help centralize and regulate
all games of chance, including casinos on land and sea within the territorial jurisdiction of
the Philippines. In Basco v. Philippine Amusements and Gaming Corporation, 4 this Court
sustained the constitutionality of the decree and even cited the benefits of the entity to
the national economy as the third highest revenue-earner in the government, next only to
the BIR and the Bureau of Customs.
Cagayan de Oro City, like other local political subdivisions, is empowered to enact
ordinances for the purposes indicated in the Local Government Code. It is expressly
vested with the police power under what is known as the General Welfare Clause now
embodied in Section 16 as follows:
Sec. 16. — General Welfare. — Every local government unit shall exercise the
powers expressly granted, those necessarily implied therefrom, as well as powers
necessary, appropriate, or incidental for its efficient and effective governance, and
those which are essential to the promotion of the general welfare. Within their
respective territorial jurisdictions, local government units shall ensure and support,
among other things, the preservation and enrichment of culture, promote health
and safety, enhance the right of the people to a balanced ecology, encourage and
 support the development of appropriate and self-reliant scientific and technological
capabilities, improve public morals, enhance economic prosperity and social
justice, promote full employment among their residents, maintain peace and order,
and preserve the comfort and convenience of their inhabitants.
The petitioners argue that by virtue of these provisions, the Sangguniang Panlungsod
may prohibit the operation of casinos because they involve games of chance, which are
detrimental to the people. Gambling is not allowed by general law and even by the
Constitution itself. The legislative power conferred upon local government units may be
exercised over all kinds of gambling and not only over "illegal gambling" as the
respondents erroneously argue. Even if the operation of casinos may have been
permitted under P.D. 1869, the government of Cagayan de Oro City has the authority to
prohibit them within its territory pursuant to the authority entrusted to it by the Local
Government Code.
It is submitted that this interpretation is consonant with the policy of local autonomy as
mandated in Article II, Section 25, and Article X of the Constitution, as well as various
other provisions therein seeking to strengthen the character of the nation. In giving the
local government units the power to prevent or suppress gambling and other social
problems, the Local Government Code has recognized the competence of such
communities to determine and adopt the measures best expected to promote the general
welfare of their inhabitants in line with the policies of the State.
The petitioners also stress that when the Code expressly authorized the local government
units to prevent and suppress gambling and other prohibited games of chance, like craps,
baccarat, blackjack and roulette, it meant all forms of gambling without distinction. Ubi lex
non distinguit, nec nos distinguere debemos. 6 Otherwise, it would have expressly
excluded from the scope of their power casinos and other forms of gambling authorized
by special law, as it could have easily done. The fact that it did not do so simply means
that the local government units are permitted to prohibit all kinds of gambling within their
territories, including the operation of casinos.
The adoption of the Local Government Code, it is pointed out, had the effect of modifying
the charter of the PAGCOR. The Code is not only a later enactment than P.D. 1869 and
so is deemed to prevail in case of inconsistencies between them. More than this, the
powers of the PAGCOR under the decree are expressly discontinued by the Code insofar
as they do not conform to its philosophy and provisions, pursuant to Par. (f) of its repealing
clause reading as follows:
(f) All general and special laws, acts, city charters, decrees, executive orders,
proclamations and administrative regulations, or part or parts thereof which are
inconsistent with any of the provisions of this Code are hereby repealed or modified
accordingly.
It is also maintained that assuming there is doubt regarding the effect of the Local
Government Code on P.D. 1869, the doubt must be resolved in favor of the petitioners,
in accordance with the direction in the Code calling for its liberal interpretation in favor of
the local government units. Section 5 of the Code specifically provides:
Sec. 5. Rules of Interpretation. — In the interpretation of the provisions of this
Code, the following rules shall apply:
(a) Any provision on a power of a local government unit shall be liberally interpreted
in its favor, and in case of doubt, any question thereon shall be resolved in favor
of devolution of powers and of the lower local government unit. Any fair and
reasonable doubt as to the existence of the power shall be interpreted in favor of
the local government unit concerned;
(c) The general welfare provisions in this Code shall be liberally interpreted to give
more powers to local government units in accelerating economic development and
upgrading the quality of life for the people in the community; . .
Finally, the petitioners also attack gambling as intrinsically harmful and cite various
provisions of the Constitution and several decisions of this Court expressive of the general
and official disapprobation of the vice. They invoke the State policies on the family and
the proper upbringing of the youth and, as might be expected, call attention to the old
case of U.S. v. Salaveria,7 which sustained a municipal ordinance prohibiting the playing
of panguingue. The petitioners decry the immorality of gambling. They also impugn the
wisdom of P.D. 1869 (which they describe as "a martial law instrument") in creating
PAGCOR and authorizing it to operate casinos "on land and sea within the territorial
jurisdiction of the Philippines."
ISSUE: Whether or not Ordinance No. 3355 and Ordinance No. 3375-93 as enacted by
the Sangguniang Panlungsod of Cagayan de Oro City are valid.
RULING: The morality of gambling is not a justiciable issue. Gambling is not illegal per
se. While it is generally considered inimical to the interests of the people, there is nothing
in the Constitution categorically proscribing or penalizing gambling or, for that matter,
even mentioning it at all. It is left to Congress to deal with the activity as it sees fit. In the
exercise of its own discretion, the legislature may prohibit gambling altogether or allow it
without limitation or it may prohibit some forms of gambling and allow others for whatever
reasons it may consider sufficient. Thus, it has prohibited jueteng and monte but permits
lotteries, cockfighting and horse-racing. In making such choices, Congress has consulted
its own wisdom, which this Court has no authority to review, much less reverse. Well has
it been said that courts do not sit to resolve the merits of conflicting theories. 8 That is the
prerogative of the political departments. It is settled that questions regarding the wisdom,
morality, or practicibility of statutes are not addressed to the judiciary but may be resolved
only by the legislative and executive departments, to which the function belongs in our
scheme of government. That function is exclusive. Whichever way these branches
decide, they are answerable only to their own conscience and the constituents who will
ultimately judge their acts, and not to the courts of justice.
The tests of a valid ordinance are well established. A long line of decisions 9 has held
that to be valid, an ordinance must conform to the following substantive requirements:
1) It must not contravene the constitution or any statute.
2) It must not be unfair or oppressive.
3) It must not be partial or discriminatory.
4) It must not prohibit but may regulate trade.
5) It must be general and consistent with public policy.
6) It must not be unreasonable.
We begin by observing that under Sec. 458 of the Local Government Code, local
government units are authorized to prevent or suppress, among others, "gambling and
other prohibited games of chance." Obviously, this provision excludes games of chance
which are not prohibited but are in fact permitted by law. The petitioners are less than
accurate in claiming that the Code could have excluded such games of chance but did
not. In fact it does. The language of the section is clear and unmistakable. Under the rule
of noscitur a sociis, a word or phrase should be interpreted in relation to, or given the
same meaning of, words with which it is associated. Accordingly, we conclude that since
the word "gambling" is associated with "and other prohibited games of chance," the word
should be read as referring to only illegal gambling which, like the other prohibited games
of chance, must be prevented or suppressed.
We could stop here as this interpretation should settle the problem quite conclusively. But
we will not. The vigorous efforts of the petitioners on behalf of the inhabitants of Cagayan
de Oro City, and the earnestness of their advocacy, deserve more than short shrift from
this Court.
The apparent flaw in the ordinances in question is that they contravene P.D. 1869 and
the public policy embodied therein insofar as they prevent PAGCOR from exercising the
power conferred on it to operate a casino in Cagayan de Oro City. The petitioners have
an ingenious answer to this misgiving. They deny that it is the ordinances that have
changed P.D. 1869 for an ordinance admittedly cannot prevail against a statute. Their
theory is that the change has been made by the Local Government Code itself, which
was also enacted by the national lawmaking authority. In their view, the decree has been,
not really repealed by the Code, but merely "modified pro tanto" in the sense that
PAGCOR cannot now operate a casino over the objection of the local government unit
concerned. This modification of P.D. 1869 by the Local Government Code is permissible
because one law can change or repeal another law.
It seems to us that the petitioners are playing with words. While insisting that the decree
has only been "modified pro tanto," they are actually arguing that it is already dead,
repealed and useless for all intents and purposes because the Code has shorn PAGCOR
of all power to centralize and regulate casinos. Strictly speaking, its operations may now
be not only prohibited by the local government unit; in fact, the prohibition is not only
discretionary but mandated by Section 458 of the Code if the word "shall" as used therein
is to be given its accepted meaning. Local government units have now no choice but to
prevent and suppress gambling, which in the petitioners' view includes both legal and
illegal gambling. Under this construction, PAGCOR will have no more games of chance
to regulate or centralize as they must all be prohibited by the local government units
pursuant to the mandatory duty imposed upon them by the Code. In this situation,
PAGCOR cannot continue to exist except only as a toothless tiger or a white elephant
and will no longer be able to exercise its powers as a prime source of government revenue
through the operation of casinos.
The rationale of the requirement that the ordinances should not contravene a statute is
obvious. Municipal governments are only agents of the national government. Local
councils exercise only delegated legislative powers conferred on them by Congress as
the national lawmaking body. The delegate cannot be superior to the principal or exercise
powers higher than those of the latter. It is a heresy to suggest that the local government
units can undo the acts of Congress, from which they have derived their power in the first
place, and negate by mere ordinance the mandate of the statute.
Municipal corporations owe their origin to, and derive their powers and rights wholly from
the legislature. It breathes into them the breath of life, without which they cannot exist. As
it creates, so it may destroy. As it may destroy, it may abridge and control. Unless there
is some constitutional limitation on the right, the legislature might, by a single act, and if
we can suppose it capable of so great a folly and so great a wrong, sweep from existence
all of the municipal corporations in the State, and the corporation could not prevent it. We
know of no limitation on the right so far as to the corporation themselves are concerned.
They are, so to phrase it, the mere tenants at will of the legislature.
This basic relationship between the national legislature and the local government units
has not been enfeebled by the new provisions in the Constitution strengthening the policy
of local autonomy. Without meaning to detract from that policy, we here confirm that
Congress retains control of the local government units although in significantly reduced
degree now than under our previous Constitutions. The power to create still includes the
power to destroy. The power to grant still includes the power to withhold or recall. True,
there are certain notable innovations in the Constitution, like the direct conferment on the
local government units of the power to tax, which cannot now be withdrawn by mere
statute. By and large, however, the national legislature is still the principal of the local
government units, which cannot defy its will or modify or violate it.

10. G.R. No. 110249 August 21, 1997

ALFREDO TANO, BALDOMERO TANO, DANILO TANO, ROMUALDO TANO,
TEOCENES MIDELLO, ANGEL DE MESA, EULOGIO TREMOCHA, FELIPE
ONGONION, JR., ANDRES LINIJAN, ROBERT LIM, VIRGINIA LIM, FELIMON DE
MESA, GENEROSO ARAGON, TEODORICO ANDRE, ROMULO DEL ROSARIO,
CHOLITO ANDRE, ERICK MONTANO, ANDRES OLIVA, VITTORIO SALVADOR,
LEOPOLDO ARAGON, RAFAEL RIBA, ALEJANDRO LEONILA, JOSE DAMACINTO,
RAMIRO MANAEG, RUBEN MARGATE, ROBERTO REYES, DANILO
PANGARUTAN, NOE GOLPAN, ESTANISLAO ROMERO, NICANOR DOMINGO,
ROLDAN TABANG, ADRIANO TABANG, FREDDIE SACAMAY, MIGUEL TRIMOCHA,
PACENCIO LABABIT, PABLO H. OMPAD, CELESTINO A. ABANO, ALLAN
ALMODAI, BILLY D. BARTOLAY, ALBINO D. LIQUE, MECHOR J. LAYSON,
MELANIE AMANTE, CLARO E. YATOC, MERGELDO B. BALDEO, EDGAR M.
ALMASETA, JOSELITO MANAEG, LIBERATO ANDRADA, JR., ROBERTO BERRY,
RONALD VILLANUEVA, EDUARDO VALMORIA, WILFREDO MENDOZA,
NAPOLEON BABANGGA, ROBERTO TADEPA, RUBEN ASINGUA, SILVERIO
GABO, JERRY ROMERO, DAVID PANGGARUTAN, DANIEL PANGGARUTAN,
ROMEO AGAWIN, FERNANDO EQUIZ, DITO LEQUIZ, RONILO MODERABLE,
BENEDICTO TORRES, ROSITO A. VALDEZ, CRESENCIO A. SAYANG, NICOMEDES
S. ACOSTA, ERENEO A. SEGARINO, JR., WILFREDO A. RAUTO, DIOSDADO A.
ACOSTA, BONIFACIO G. SISMO, TACIO ALUBA, DANIEL B. BATERZAL, ELISEO
YBAÑEZ, DIOSDADO E. HANCHIC, EDDIE ESCALICAS, ELEAZAR B. BATERZAL,
DOMINADOR HALICHIC, ROOSEVELT RISMO-AN, ROBERT C. MERCADER, TIRSO
ARESGADO, DANIEL CHAVEZ, DANILO CHAVEZ, VICTOR VILLAROEL, ERNESTO
C. YBAÑEZ, ARMANDO T. SANTILLAN, RUDY S. SANTILLAN, JODJEN
ILUSTRISIMO, NESTOR SALANGRON, ALBERTO SALANGRON, ROGER L.
ROXAS, FRANCISCO T. ANTICANO, PASTOR SALANGRON, BIENVENIDO
SANTILLAN, GILBUENA LADDY, FIDEL BENJAMIN, JOVELITO BELGANO, HONEY
PARIOL, ANTONIO SALANGRON, NICASIO SALANGRON, & AIRLINE SHIPPERS
ASSOCIATION OF PALAWAN, petitioners, vs. HON. GOV. SALVADOR P.
SOCRATES, MEMBERS OF SANGGUNIANG PANLALAWIGAN OF PALAWAN,
namely, VICE-GOVERNOR JOEL T. REYES, JOSE D. ZABALA, ROSALINO R.
ACOSTA, JOSELITO A. CADLAON, ANDRES R. BAACO, NELSON P. PENEYRA,
CIPRIANO C. BARROMA, CLARO E. ORDINARIO, ERNESTO A. LLACUNA,
RODOLFO C. FLORDELIZA, GILBERT S. BAACO, WINSTON G. ARZAGA,
NAPOLEON F. ORDONEZ and GIL P. ACOSTA, CITY MAYOR EDWARD
HAGEDORN, MEMBERS OF SANGGUNIANG PANLUNGSOD NG PUERTO
PRINCESA, ALL MEMBERS OF BANTAY DAGAT, MEMBERS OF PHILIPPINE
NATIONAL POLICE OF PALAWAN, PROVINCIAL AND CITY PROSECUTORS OF
PALAWAN and PUERTO PRINCESA CITY, and ALL JUDGES OF PALAWAN,
REGIONAL, MUNICIPAL AND METROPOLITAN, respondents.
FACTS: On December 15, 1992, the Sangguniang Panlungsod ng Puerto Princesa City
enacted Ordinance No. 15-92 entitled: "AN ORDINANCE BANNING THE SHIPMENT OF
ALL LIVE FISH AND LOBSTER OUTSIDE PUERTO PRINCESA CITY FROM JANUARY
1, 1993 TO JANUARY 1, 1998 AND PROVIDING EXEMPTIONS, PENALTIES AND FOR
OTHER PURPOSES THEREOF".
To implement said city ordinance, then Acting City Mayor Amado L. Lucero issued Office
Order No. 23, Series of 1993. The purpose of the inspection is to ascertain whether the
shipper possessed the required Mayor's Permit issued by this Office and the shipment is
covered by invoice or clearance issued by the local office of the Bureau of Fisheries and
Aquatic Resources and as to compliance with all other existing rules and regulations on
the matter. Any cargo containing live fish and lobster without the required documents as
stated herein must be held for proper disposition.
On February 19, 1993, the Sangguniang Panlalawigan, Provincial Government of
Palawan enacted Resolution No. 33 entitled: "A RESOLUTION PROHIBITING THE
CATCHING, GATHERING, POSSESSING, BUYING, SELLING AND SHIPMENT OF
LIVE MARINE CORAL DWELLING AQUATIC ORGANISMS, TO WIT: FAMILY:
SCARIDAE (MAMENG), EPINE PHELUS FASCIATUS (SUNO). CROMILEPTES
ALTIVELIS (PANTHER OR SENORITA), LOBSTER BELOW 200 GRAMS AND
SPAWNING, TRIDACNA GIGAS (TAKLOBO), PINCTADA MARGARITEFERA
(MOTHER PEARL, OYSTERS, GIANT CLAMS AND OTHER SPECIES), PENAEUS
MONODON (TIGER PRAWN-BREEDER SIZE OR MOTHER), EPINEPHELUS SUILLUS
(LOBA OR GREEN GROUPER) AND FAMILY: BALISTIDAE (TROPICAL AQUARIUM
FISHES) FOR A PERIOD FIVE (5) YEARS IN AND COMING FROM PALAWAN
WATERS"
The respondents implemented the said ordinances thereby depriving all the fishermen of
the whole province of Palawan and the City of Puerto Princesa of their only means of
livelihood and the petitioners Airline Shippers Association of Palawan and other marine
merchants from performing their lawful occupation and trade
Petitioners Alfredo Tano, Baldomero Tano, Teocenes Midello, Angel de Mesa, Eulogio
Tremocha, and Felipe Ongonion, Jr. were even charged criminally under criminal case
no. 93-05-C in the 1st Municipal Circuit Trial Court of Cuyo-Agutaya-Magsaysay.
Petitioners Robert Lim and Virginia Lim, on the other hand, were charged by the
respondent PNP with the respondent City Prosecutor of Puerto Princess City.
Without seeking redress from the concerned local government units, prosecutor's office
and courts, petitioners directly invoked our original jurisdiction by filing this petition on 4
June 1993. In sum, petitioners contend that:
First, the Ordinances deprived them of 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.
Second, Office Order No. 23 contained no regulation nor condition under which
the Mayor's permit could be granted or denied; in other words, the Mayor had the
absolute authority to determine whether or not to issue the permit.
Third, as Ordinance No. 2 of the Province of Palawan "altogether prohibited the
catching, gathering, possession, buying, selling and shipping of live marine coral
dwelling organisms, without any distinction whether it was caught or gathered
through lawful fishing method," the Ordinance took away the right of petitioners-
fishermen to earn their livelihood in lawful ways; and insofar as petitioners-
members of Airline Shippers Association are concerned, they were unduly
prevented from pursuing their vocation and entering "into contracts which are
proper, necessary, and essential to carry out their business endeavors to a
successful conclusion."
Finally, as Ordinance No. 2 of the Sangguniang Panlalawigan is null and void, the
criminal cases based thereon against petitioners Tano and the others have to be
dismissed.
In the Resolution of 15 June 1993 the Court required respondents to comment on the
petition, and furnished the Office of the Solicitor General with a copy thereof.
In their comment filed on 13 August 1993, public respondents Governor Socrates and
Members of the Sangguniang Panlalawigan of Palawan defended the validity of
Ordinance No. 2, Series of 1993, as a valid exercise of the Provincial Government's power
under the general welfare clause (Section 16 of the Local Government Code of 1991
[hereafter, LGC]), and its specific power to protect the environment and impose
appropriate penalties for acts which endanger the environment, such as dynamite fishing
and other forms of destructive fishing under Section 447 (a) (1) (vi), Section 458 (a) (1)
(vi), and Section 468 (a) (1) (vi), of the LGC. They claimed that in the exercise of such
powers, the Province of Palawan had "the right and responsibility . . . to insure that the
remaining coral reefs, where fish dwells [sic], within its territory remain healthy for the
future generation." The Ordinance, they further asserted, covered only live marine coral
dwelling aquatic organisms which were enumerated in the ordinance and excluded other
kinds of live marine aquatic organisms not dwelling in coral reefs; besides the prohibition
was for only five (5) years to protect and preserve the pristine coral and allow those
damaged to regenerate.
Respondents likewise maintained that there was no violation of the due process and
equal protection clauses of the Constitution. As to the former, public hearings were
conducted before the enactment of the Ordinance which, undoubtedly, had a lawful
purpose and employed reasonable means; while as to the latter, a substantial distinction
existed "between a fisherman who catches live fish with the intention of selling it live, and
a fisherman who catches live fish with no intention at all of selling it live," i.e., "the former
uses sodium cyanide while the latter does not." Further, the Ordinance applied equally to
all those belonging to one class.
On 25 October 1993 petitioners filed an Urgent Plea for the Immediate Issuance of a
Temporary Restraining Order, claiming that despite the pendency of this case, Branch 50
of the Regional Trial Court of Palawan was bent on proceeding with Criminal Case No.
11223 against petitioners Danilo Tano, Alfredo Tano, Eulogio Tremocha, Romualdo
Tano, Baldomero Tano, Andres Linijan and Angel de Mesa for violation of Ordinance No.
2 of the Sangguniang Panlalawigan of Palawan. Acting on said plea, we issued on 11
November 1993 a temporary restraining order directing Judge Angel Miclat of said court
to cease and desist from proceeding with the arraignment and pre-trial of Criminal Case
No. 11223.
On 22 April 1997 the Court ordered impleaded as party respondents the Department of
Agriculture and the Bureau of Fisheries and Aquatic Resources and required the Office
of the Solicitor General to comment on their behalf. But in light of the latter's motion of 9
July 1997 for an extension of time to file the comment which would only result in further
delay, the Court dispensed with said comment.
ISSUE: Whether or not the challenged ordinance is constituional
RULING: After due deliberation on the pleadings filed, the Court resolved to dismiss this
petition for want of merit, and on 22 July 1997, assigned it to the ponente to write the
opinion of the Court.
It is of course settled that laws (including ordinances enacted by local government units)
enjoy the presumption of constitutionality. To overthrow this presumption, there must be
a clear and unequivocal breach of the Constitution, not merely a doubtful or
argumentative contradiction. In short, the conflict with the Constitution must be shown
beyond reasonable doubt. Where doubt exists, even if well-founded, there can be no
finding of unconstitutionality. To doubt is to sustain.
After a scrutiny of the challenged Ordinances and the provisions of the Constitution
petitioners claim to have been violated, the Court find petitioners' contentions baseless
and so hold that the former do not suffer from any infirmity, both under the Constitution
and applicable laws.
Petitioners specifically point to Section 2, Article XII and Sections 2 and 7, Article XIII of
the Constitution as having been transgressed by the Ordinances. The pertinent portion of
Section 2 of Article XII reads:
Sec. 2. . . .
The State shall protect the nation's marine wealth in its archipelagic waters,
territorial sea, and exclusive economic zone, and reserve its use and enjoyment
exclusively to Filipino citizens.
The Congress may, by law, allow small-scale utilization of natural resources by
Filipino citizens, as well as cooperative fish farming, with priority to subsistence
fishermen and fishworkers in rivers, lakes, bays, and lagoons.
Sections 2 and 7 of Article XIII provide:
Sec. 2. The promotion of social justice shall include the commitment to create
economic opportunities based on freedom of initiative and self-reliance.
 Sec. 7. The State shall protect the rights of subsistence fishermen, especially of
local communities, to the preferential use of the communal marine and fishing
resources, both inland and offshore. It shall provide support to such fishermen
through appropriate technology and research, adequate financial, production, and
marketing assistance, and other services. The State shall also protect, develop,
and conserve such resources. The protection shall extend to offshore fishing
grounds of subsistence fishermen against foreign intrusion. Fishworkers shall
receive a just share from their labor in the utilization of marine and fishing
resources.
There is absolutely no showing that any of the petitioners qualifies as a subsistence or
marginal fisherman. In their petition, petitioner Airline Shippers Association of Palawan is
self-described as "a private association composed of Marine Merchants;" petitioners
Robert Lim and Virginia Lim, as "merchants;" while the rest of the petitioners claim to be
"fishermen," without any qualification, however, as to their status.
Since the Constitution does not specifically provide a definition of the terms "subsistence"
or "marginal" fishermen, they should be construed in their general and ordinary sense. A
marginal fisherman is an individual engaged in fishing whose margin of return or reward
in his harvest of fish as measured by existing price levels is barely sufficient to yield a
profit or cover the cost of gathering the fish, while a subsistence fisherman is one whose
catch yields but the irreducible minimum for his livelihood. Section 131(p) of the LGC
(R.A. No. 7160) defines a marginal farmer or fisherman as "an individual engaged in
subsistence farming or fishing which shall be limited to the sale, barter or exchange of
agricultural or marine products produced by himself and his immediate family." It bears
repeating that nothing in the record supports a finding that any petitioner falls within these
definitions.
The LGC vests municipalities with the power to grant fishery privileges in municipal waters
and impose rentals, fees or charges therefor; to penalize, by appropriate ordinances, the
use of explosives, noxious or poisonous substances, electricity, muro-ami, and other
deleterious methods of fishing; and to prosecute any violation of the provisions of
applicable fishery laws. Further, the sangguniang bayan, the sangguniang panlungsod
and the sangguniang panlalawigan are directed to enact ordinances for the general
welfare of the municipality and its inhabitants, which shall include, inter alia, ordinances
that "[p]rotect the environment and impose appropriate penalties for acts which endanger
the environment such as dynamite fishing and other forms of destructive fishing . . . and
such other activities which result in pollution, acceleration of eutrophication of rivers and
lakes, or of ecological imbalance."

11. G.R. No. L-24693 July 31, 1967

ERMITA-MALATE HOTEL AND MOTEL OPERATORS ASSOCIATION, INC., HOTEL
DEL MAR INC. and GO CHIU, petitioners-appellees, vs. THE HONORABLE CITY
MAYOR OF MANILA, respondent-appellant.
VICTOR ALABANZA, intervenor-appellee.
FACTS: The petition for prohibition against Ordinance No. 4760 was filed on July 5, 1963
by the petitioners, Ermita-Malate Hotel and Motel Operators Association, one of its
members, Hotel del Mar Inc., and a certain Go Chiu, who is "the president and general
manager of the second petitioner" against the respondent Mayor of the City of Manila who
was sued in his capacity as such "charged with the general power and duty to enforce
ordinances of the City of Manila and to give the necessary orders for the faithful execution
and enforcement of such ordinances.". It was alleged that the petitioner non-stock
corporation is dedicated to the promotion and protection of the interest of its eighteen (18)
members "operating hotels and motels, characterized as legitimate businesses duly
licensed by both national and city authorities, regularly paying taxes, employing and
giving livelihood to not less than 2,500 person and representing an investment of more
than P3 million."1. It was then alleged that on June 13, 1963, the Municipal Board of the
City of Manila enacted Ordinance No. 4760, approved on June 14, 1963 by the then Vice-
Mayor Herminio Astorga, who was at the time acting as Mayor of the City of Manila.
After which the alleged grievances against the ordinance were set forth in detail. There
was the assertion of its being beyond the powers of the Municipal Board of the City of
Manila to enact insofar as it would regulate motels, on the ground that in the revised
charter of the City of Manila or in any other law, no reference is made to motels; that
Section 1 of the challenged ordinance is unconstitutional and void for being unreasonable
and violative of due process insofar as it would impose P6,000.00 fee per annum for first
class motels and P4,500.00 for second class motels; that the provision in the same
section which would require the owner, manager, keeper or duly authorized
representative of a hotel, motel, or lodging house to refrain from entertaining or accepting
any guest or customer or letting any room or other quarter to any person or persons
without his filling up the prescribed form in a lobby open to public view at all times and in
his presence, wherein the surname, given name and middle name, the date of birth, the
address, the occupation, the sex, the nationality, the length of stay and the number of
companions in the room, if any, with the name, relationship, age and sex would be
specified, with data furnished as to his residence certificate as well as his passport
number, if any, coupled with a certification that a person signing such form has personally
filled it up and affixed his signature in the presence of such owner, manager, keeper or
duly authorized representative, with such registration forms and records kept and bound
together, it also being provided that the premises and facilities of such hotels, motels and
lodging houses would be open for inspection either by the City Mayor, or the Chief of
Police, or their duly authorized representatives is unconstitutional and void again on due
process grounds, not only for being arbitrary, unreasonable or oppressive but also for
being vague, indefinite and uncertain, and likewise for the alleged invasion of the right to
privacy and the guaranty against self-incrimination; that Section 2 of the challenged
ordinance classifying motels into two classes and requiring the maintenance of certain
minimum facilities in first class motels such as a telephone in each room, a dining room
or, restaurant and laundry similarly offends against the due process clause for being
arbitrary, unreasonable and oppressive, a conclusion which applies to the portion of the
ordinance requiring second class motels to have a dining room; that the provision of
Section 2 of the challenged ordinance prohibiting a person less than 18 years old from
being accepted in such hotels, motels, lodging houses, tavern or common inn unless
accompanied by parents or a lawful guardian and making it unlawful for the owner,
manager, keeper or duly authorized representative of such establishments to lease any
room or portion thereof more than twice every 24 hours, runs counter to the due process
guaranty for lack of certainty and for its unreasonable, arbitrary and oppressive character;
and that insofar as the penalty provided for in Section 4 of the challenged ordinance for
a subsequent conviction would, cause the automatic cancellation of the license of the
offended party, in effect causing the destruction of the business and loss of its
investments, there is once again a transgression of the due process clause.
There was a plea for the issuance of preliminary injunction and for a final judgment
declaring the above ordinance null and void and unenforceable. The lower court on July
6, 1963 issued a writ of preliminary injunction ordering respondent Mayor to refrain from
enforcing said Ordinance No. 4760 from and after July 8, 1963.
In the answer filed on August 3, 1963, there was an admission of the personal
circumstances regarding the respondent Mayor and of the fact that petitioners are
licensed to engage in the hotel or motel business in the City of Manila, of the provisions
of the cited Ordinance but a denial of its alleged nullity, whether on statutory or
constitutional grounds. After setting forth that the petition did fail to state a cause of action
and that the challenged ordinance bears a reasonable relation, to a proper purpose, which
is to curb immorality, a valid and proper exercise of the police power and that only the
guests or customers not before the court could complain of the alleged invasion of the
right to privacy and the guaranty against self incrimination, with the assertion that the
issuance of the preliminary injunction ex parte was contrary to law, respondent Mayor
prayed for, its dissolution and the dismissal of the petition.
Instead of evidence being offered by both parties, there was submitted a stipulation of
facts dated September 28, 1964.
Thereafter came a memorandum for respondent on January 22, 1965, wherein stress
was laid on the presumption of the validity of the challenged ordinance, the burden of
showing its lack of conformity to the Constitution resting on the party who assails it, citing
not only U.S. v. Salaveria, but likewise applicable American authorities. Such a
memorandum likewise refuted point by point the arguments advanced by petitioners
against its validity. Then barely two weeks later, on February 4, 1965, the memorandum
for petitioners was filed reiterating in detail what was set forth in the petition, with citations
of what they considered to be applicable American authorities and praying for a judgment
declaring the challenged ordinance "null and void and unenforceable" and making
permanent the writ of preliminary injunction issued.
After referring to the motels and hotels, which are members of the petitioners association,
and referring to the alleged constitutional questions raised by the party, the lower court
observed: "The only remaining issue here being purely a question of law, the parties, with
the nod of the Court, agreed to file memoranda and thereafter, to submit the case for
decision of the Court." It does appear obvious then that without any evidence submitted
by the parties, the decision passed upon the alleged infirmity on constitutional grounds of
the challenged ordinance, dismissing as is undoubtedly right and proper the untenable
objection on the alleged lack of authority of the City of Manila to regulate motels, and
came to the conclusion that "the challenged Ordinance No. 4760 of the City of Manila,
would be unconstitutional and, therefore, null and void." It made permanent the
preliminary injunction issued against respondent Mayor and his agents "to restrain him
from enforcing the ordinance in question." Hence this appeal.
ISSUE: whether Ordinance No. 4760 of the City of Manila is violative of the due process
clause. The lower court held that it is and adjudged it "unconstitutional, and, therefore,
null and void.
RULING: As noted at the outset, the judgment must be reversed. Primarily what calls for
a reversal of such a decision is the absence of any evidence to offset the presumption of
validity that attaches to a challenged statute or ordinance.
It admits of no doubt therefore that there being a presumption of validity, the necessity for
evidence to rebut it is unavoidable, unless the statute or ordinance is void on its face
which is not the case here. No such factual foundation being laid in the present case, the
lower court deciding the matter on the pleadings and the stipulation of facts, the
presumption of validity must prevail and the judgment against the ordinance set aside.
Nor may petitioners assert with plausibility that on its face the ordinance is fatally defective
as being repugnant to the due process clause of the Constitution. The mantle of protection
associated with the due process guaranty does not cover petitioners. This particular
manifestation of a police power measure being specifically aimed to safeguard public
morals is immune from such imputation of nullity resting purely on conjecture and
unsupported by anything of substance. To hold otherwise would be to unduly restrict and
narrow the scope of police power which has been properly characterized as the most
essential, insistent and the least limitable of powers, extending as it does "to all the great
public needs." It would be, to paraphrase another leading decision, to destroy the very
purpose of the state if it could be deprived or allowed itself to be deprived of its
competence to promote public health, public morals, public safety and the general
welfare. Negatively put, police power is "that inherent and plenary power in the State
which enables it to prohibit all that is hurt full to the comfort, safety, and welfare of society.
There is no question but that the challenged ordinance was precisely enacted to minimize
certain practices hurtful to public morals. The challenged ordinance then proposes to
check the clandestine harboring of transients and guests of these establishments by
requiring these transients and guests to fill up a registration form, prepared for the
purpose, in a lobby open to public view at all times, and by introducing several other
amendatory provisions calculated to shatter the privacy that characterizes the registration
of transients and guests."
Negatively put, arbitrariness is ruled out and unfairness avoided. It would thus be an
affront to reason to stigmatize an ordinance enacted precisely to meet what a municipal
lawmaking body considers an evil of rather serious proportion an arbitrary and capricious
exercise of authority. It would seem that what should be deemed unreasonable and what
would amount to an abdication of the power to govern is inaction in the face of an admitted
deterioration of the state of public morals. To be more specific, the Municipal Board of the
City of Manila felt the need for a remedial measure. It provided it with the enactment of
the challenged ordinance. A strong case must be found in the records, and, as has been
set forth, none is even attempted here to attach to an ordinance of such character the
taint of nullity for an alleged failure to meet the due process requirement. Nor does it lend
any semblance even of deceptive plausibility to petitioners' indictment of Ordinance No.
4760 on due process grounds to single out such features as the increased fees for motels
and hotels, the curtailment of the area of freedom to contract, and, in certain particulars,
its alleged vagueness.
Nor does the restriction on the freedom to contract, insofar as the challenged ordinance
makes it unlawful for the owner, manager, keeper or duly authorized representative of
any hotel, motel, lodging house, tavern, common inn or the like, to lease or rent room or
portion thereof more than twice every 24 hours, with a proviso that in all cases full
payment shall be charged, call for a different conclusion. Again, such a limitation cannot
be viewed as a transgression against the command of due process. It is neither
unreasonable nor arbitrary. Precisely it was intended to curb the opportunity for the
immoral or illegitimate use to which such premises could be, and, according to the
explanatory note, are being devoted. How could it then be arbitrary or oppressive when
there appears a correspondence between the undeniable existence of an undesirable
situation and the legislative attempt at correction. Moreover, petitioners cannot be
unaware that every regulation of conduct amounts to curtailment of liberty which as
pointed out by Justice Malcolm cannot be absolute. Thus: "One thought which runs
through all these different conceptions of liberty is plainly apparent. It is this: 'Liberty' as
understood in democracies, is not license; it is 'liberty regulated by law.' Implied in the
term is restraint by law for the good of the individual and for the greater good of the peace
and order of society and the general well-being. No man can do exactly as he pleases.
Every man must renounce unbridled license. The right of the individual is necessarily
subject to reasonable restraint by general law for the common good x x x The liberty of
the citizen may be restrained in the interest of the public health, or of the public order and
safety, or otherwise within the proper scope of the police power."
Lastly, there is the attempt to impugn the ordinance on another due process ground by
invoking the principles of vagueness or uncertainty. It would appear from a recital in the
petition itself that what seems to be the gravamen of the alleged grievance is that the
provisions are too detailed and specific rather than vague or uncertain.
Petitioners, however, point to the requirement that a guest should give the name,
relationship, age and sex of the companion or companions as indefinite and uncertain in
view of the necessity for determining whether the companion or companions referred to
are those arriving with the customer or guest at the time of the registry or entering the
room With him at about the same time or coming at any indefinite time later to join him; a
proviso in one of its sections which cast doubt as to whether the maintenance of a
restaurant in a motel is dependent upon the discretion of its owners or operators; another
proviso which from their standpoint would require a guess as to whether the "full rate of
payment" to be charged for every such lease thereof means a full day's or merely a half-
day's rate. It may be asked, do these allegations suffice to render the ordinance void on
its face for alleged vagueness or uncertainty? To ask the question is to answer it. From
Connally v. General Construction Co.33 to Adderley v. Florida,34 the principle has been
consistently upheld that what makes a statute susceptible to such a charge is an
enactment either forbidding or requiring the doing of an act that men of common
intelligence must necessarily guess at its meaning and differ as to its application. Is this
the situation before us? A citation from Justice Holmes would prove illuminating: "We
agree to all the generalities about not supplying criminal laws with what they omit but
there is no canon against using common sense in construing laws as saying what they
obviously mean."
That is all then that this case presents. As it stands, with all due allowance for the
arguments pressed with such vigor and determination, the attack against the validity of
the challenged ordinance cannot be considered a success.