POLICE POWER The Chairman of the National Traffic
Commission on July 18, 1940 recommended
MAXIMO CALALANG vs A. D. WILLIAMS,
ET AL.
G.R. No. 47800 December 2, 1940
Doctrine: Social Justice
Facts:
The National Traffic Commission, in its
resolution of July 17, 1940, resolved to
recommend to the Director of the Public
Works and to the Secretary of Public Works
and Communications that animal-drawn
vehicles be prohibited from passing along the
following for a period of one year from the
date of the opening of the Colgante Bridge to
traffic:
1) Rosario Street extending from Plaza
Calderon de la Barca to Dasmariñas Street
from 7:30 am to 12:30 pm and from 1:30 pm
to 530 pm; and
2) along Rizal Avenue extending from the
railroad crossing at Antipolo Street to
Echague Street from 7 am to 11pm
ISSUES::
to the Director of Public Works with the
approval of the Secretary of Public Works the
adoption of thethemeasure proposed in the
resolution aforementioned in pursuance of the
provisions of theCommonwealth Act No. 548
which authorizes said Director with the
approval from the Secretary of the Public
Works and Communication to promulgate
rules and regulations to regulate and control
the use of and traffic on national roads.
On August 2, 1940, the Director
recommended to the Secretary the approval
of the recommendations made by the
Chairman of the National Traffic Commission
with modifications. The Secretary of Public
Works approved the recommendations on
August 10,1940. The Mayor of Manila and the
Acting Chief of Police of Manila have enforced
and caused to be enforced the rules and
regulation. As a consequence, all animal-
drawn vehicles are not allowed to pass and
pick up passengers in the places above
mentioned to the detriment not only of their
owners but of the riding public as well.
1) Whether the rules and regulations
promulgated by the respondents pursuant to
the provisions of Commonwealth Act NO. 548
constitute an unlawful inference with
legitimate business or trade and abridged the
right to personal liberty and freedom of
locomotion?
2) Whether the rules and regulations
complained of infringe upon the constitutional
precept regarding the promotion of social
justice to insure the well-being and economic
security of all the people?
HELD:
1) No. The promulgation of the Act aims to
promote safe transit upon and avoid
obstructions on national roads in the interest
and convenience of the public. In enacting
said law, the National Assembly was
prompted by considerations of public
convenience and welfare. It was inspired by
the desire to relieve congestion of traffic,
which is a menace to the public safety. Public
welfare lies at the bottom of the promulgation
of the said law and the state in order to
promote the general welfare may interfere
with personal liberty, with property, and with
business and occupations. Persons and
property may be subject to all kinds of
restraints and burdens in order to secure the
general comfort, health, and prosperity of the
State. To this fundamental aims of the
government, the rights of the individual are
subordinated. Liberty is a blessing which
should not be made to prevail over authority
because society will fall into anarchy. Neither
should authority be made to prevail over
liberty because then the individual will fall into
slavery. The paradox lies in the fact that the
apparent curtailment of liberty is precisely the
very means of insuring its preserving.
Furthermore, Commonwealth Act No. 548 was
passed by the National Assembly in the
exercise of the paramount police power of the
state.
Said Act, by virtue of which the rules and
regulations complained of were promulgated,
aims to promote safe transit upon and avoid
obstructions on national roads, in the interest
and convenience of the public. In enacting
said law, therefore, the National Assembly
was prompted by considerations of public the exercise of powers underlying the
convenience and welfare. existence of all governments on the time-
The Court reiterated that it previously ruled in honored principles of salus populi estsuprema
U.S. v. Gomez Jesus, that public welfare, lex.
then, lies at the bottom of the enactment of
said law, and the state in order to promote the Social justice must be founded on the
general welfare may interfere with personal recognition of the necessity of
liberty, with property, and with business and interdependence among divers and diverse
occupations. Persons and property may be units of a society and of the protection that
subjected to all kinds of restraints and should be equally and evenly extended to all
burdens, in order to secure the general groups as a combined force in our social and
comfort, health, and prosperity of the state economic life, consistent with the fundamental
and paramount objective of the state of
2) No. Social justice is “neither communism, promoting health, comfort and quiet of all
nor despotism, nor atomism, nor anarchy,” but persons, and of bringing about “the greatest
the humanization of laws and the equalization good to the greatest number.”
of social and economic forces by the State so
that justice in its rational and objectively
secular conception may at least be
approximated. Social justice means the
promotion of the welfare of all the people, the
adoption by the Government of measures
calculated to insure economic stability of all
the competent elements of society, through
the maintenance of a proper economic and
social equilibrium in the interrelations of the
members of the community, constitutionally,
through the adoption of measures legally
justifiable, or extra-constitutionally, through

No. 10572. December 21, 1915.
FRANCIS A. CHURCHILL and STEWART
TAIT vs. JAMES J. RAFFERTY
FACTS:
Plaintiffs put up a billboard on a private land
located in Rizal Province “quite distance from
the road and strongly built, not dangerous to
the safety of the people, and contained no
advertising matter which is filthy, indecent, or
deleterious to the morals of the community.”
However, defendant Rafferty, Collector of
Internal Revenue, decided to remove the
billboards after due investigation made upon
the complaints of the British and German
Consuls.
Act No. 2339 authorized the then Collector of
Internal Revenue to remove after due
investigation, any billboard exposed to the
public view if it decides that it is offensive to
the sight or is otherwise a nuisance.
In the agreed statement of facts submitted by
the parties, the plaintiffs "admit that the
billboards mentioned were and still are
offensive to the sight."
The Court of First Instance perpetually
restrains and prohibits the defendant and his
deputies from collecting and enforcing against
the plaintiffs and their property the annual tax
mentioned and described in subsection (b) of
section 100 of Act No. 2339, effective July 1,
1914, and from destroying or removing any
sign, signboard, or billboard, the property of
the plaintiffs and decrees the cancellation of
the bond given by the plaintiffs.
Hence, this petition.
ISSUE:
WON Act No. 2339 was a legitimate exercise
of the police power of the Government?
HELD:
YES. Things offensive to the senses, such as
sight, smell or hearing, may be suppressed by
the State especially those situated in thickly
populated districts. Aesthetics may be
regulated by the police power of the state, as
long as it is justified by public interest and
safety.
Moreover, if the police power may be
exercised to encourage a healthy social and
economic condition in the country, and if the
comfort and convenience of the people are
included within those subjects, everything
which encroaches upon such territory is
amenable to the police power of the State.
Hence, the judgment of the CFI is reversed.
THE UNITED STATES vs. LUIS TORIBIO
G.R. No. L-5060 January 26, 1910
FACTS:
Toribio was found by the trial court of Bohol
violating Sections 30 and 33 of Act No. 1147,
an Act regulating the registration, branding,
and slaughter of Large Cattle. The act
prohibits the slaughter of large cattle fit for
agricultural work or other draft purposes for
human consumption.
Appellant Toribio slaughtered or caused to be
slaughtered his carabao without a permit from
the municipal treasurer of the municipality.
It appears that in the town of Carmen, in the
Province of Bohol, wherein the animal was
slaughtered there is no municipal
slaughterhouse, and counsel for appellant
contends that under such circumstances the
provisions of Act No. 1147 do not prohibit nor
penalize the slaughter of large cattle without a
permit of the municipal treasure.
Appellant contends that he applied for a
permit to slaughter the animal but was not
given one because the carabao was not found
to be “unfit for agricultural work” which
resulted to appellant to slaughter said carabao
in a place other than the municipal
slaughterhouse.
Appellant then assails the validity of a
provision under Act No. 1147 which states
that only carabaos unfit for agricultural work
can be slaughtered.
Appellant also contended that the act
constitutes a taking of property for public use
in the exercise of the right of eminent domain
without providing for the compensation of
owners, and it is an undue and unauthorized
exercise of police power of the state for it
deprives them of the enjoyment of their private
property.
ISSUES:
1. WON the prohibition and the penalty
imposed in Act No. 1147 is limited only
to the slaughter of large cattle at the
municipal slaughterhouse.
2. WON Act. No. 1147, regulating the
registration, branding and slaughter of
large cattle, is an undue and
unauthorized exercise of police power.
HELD:
1. NO. The prohibition and penalty imposed in
Act No. 1147 applies generally to the
slaughter of large cattle for human
consumption, anywhere, without a permit duly
secured from the municipal treasurer, and
specifically to the killing for food of large cattle
at a municipal slaughterhouse without such
permit.
Where the language of a statute is fairly
susceptible of two or more constructions, that
construction should be adopted which will
most tend to give effect to the manifest intent
of the lawmaker and promote the object for
which the statute was enacted, and a
construction should be rejected which would
tend to render abortive other provisions of the
statute and to defeat the object which the
legislator sought to attain by its enactment.
Therefore, sections 30 and 33 of the Act
prohibit and penalize the slaughtering or
causing to be slaughtered for human
consumption of large cattle at any place
without the permit provided for in section 30.
2. NO. Act no. 1147 is not a taking of the
property for public use, within the meaning of
the constitution, but is a just and legitimate
exercise of the power of the legislature to
regulate and restrain such particular use of
the property as would be inconsistent with the
rights of the publics. All property is acquired
and held under the tacit condition that it shall
not be so used as to injure the equal rights of
others or greatly impair the public rights and
interests of the community.
The Supreme Court cited events that happen
in the Philippines like an epidemic that wiped
70-100% of the population of carabaos.. The
Supreme Court also said that these animals
are vested with public interest for they are
fundamental use for the production of crops.
These reasons satisfy the requisites of a valid
exercise of police power
Finally, SC said that article 1147 is not an
exercise of the inherent power of eminent
domain. The said law does not constitute the
taking of carabaos for public purpose; it just
serve as a mere regulation for the
consumption of these private properties for
the protection of general welfare and public
interest.

ICHONG v HERNANDEZ
G.R. NO. L-7995 May 31, 1957
FACTS:
A law, RA No. 1180 entitled "An Act to
Regulate the Retail Business" was enacted
with an effect of nationalizing the retail trade
business. The main provisions of the Act are:
(1) a prohibition against persons, not
citizens of the Philippines, and
against associations, partnerships,
or corporations the capital of which
are not wholly owned by citizens of
the Philippines, from engaging
directly or indirectly in the retail
trade;
(2) an exception from the above
prohibition in favor of aliens actually
engaged in said business on May
15, 1954, who are allowed to
continue to engaged therein, unless
their licenses are forfeited in
accordance with the law, until their
death or voluntary retirement in
case of natural persons, and for ten
years after the approval of the Act
or until the expiration of term in case
of juridical persons;
(3) an exception therefrom in favor of
citizens and juridical entities of the
United States;
(4) a provision for the forfeiture of
licenses (to engage in the retail
business) for violation of the laws on
nationalization, control weights and
measures and labor and other laws
relating to trade, commerce and
industry;
(5) a prohibition against the
establishment or opening by aliens
actually engaged in the retail business
of additional stores or branches of retail
business;
(6) a provision requiring aliens actually
engaged in the retail business to present
for registration with the proper
authorities a verified statement
concerning their businesses, giving,
among other matters, the nature of the
business, their assets and liabilities and
their offices and principal offices of
judicial entities; and
(7) a provision allowing the heirs of
aliens now engaged in the retail
business who die, to continue such
business for a period of six months for
purposes of liquidation.
Petitioner Inchong, for and in his own behalf
and on behalf of other alien resident
corporations and partnerships adversely
affected by the provisions of Republic Act. No.
1180, brought this action to obtain a judicial
declaration that said Act is unconstitutional,
and to enjoin the Secretary of Finance and all
other persons acting under him, particularly
city and municipal treasurers, from enforcing
its provisions. Inchong attacks the
constitutionality of the Act, contending that: (1)
it denies to alien residents the equal
protection of the laws and deprives of their
liberty and property without due process of
law ; (2) the subject of the Act is not
expressed or comprehended in the title
thereof; (3) the Act violates international and
treaty obligations of the Republic of the
Philippines; (4) the provisions of the Act
against the transmission by aliens of their
retail business thru hereditary succession, and
those requiring 100% Filipino capitalization for
a corporation or entity to entitle it to engage in
the retail business, violate the spirit of
Sections 1 and 5, Article XIII and Section 8 of
Article XIV of the Constitution.

In answer, the Solicitor-General and the Fiscal
of the City of Manila contend that: (1) the Act
was passed in the valid exercise of the police
power of the State, which exercise is
authorized in the Constitution in the interest of
national economic survival; (2) the Act has
only one subject embraced in the title; (3) no
treaty or international obligations are infringed;
(4) as regards hereditary succession, only the
form is affected but the value of the property is
not impaired, and the institution of inheritance
is only of statutory origin.
ISSUE:
WON RA 1180 is unconstitutional since its
exercise violates one’s right to due process
and equal protection as guaranteed by the
Constitution
HELD:
NO. The Court finds the enactment of RA
1180 to clearly fall within the scope of police
power of the State. It is clear that the law in
question was enacted to remedy a real and
actual threat and danger to the national
economy posed by alien dominance and
control of retail business and free citizens and
country from the said dominance and control.
It has been said the police power is so far -
reaching in scope, that it has become almost
impossible to limit its sweep. As it derives its
existence from the very existence of the State
itself, it does not need to be expressed or
defined in its scope; it is said to be co-
extensive with self-protection and survival,
and as such it is the most positive and active
of all governmental processes, the most
essential, insistent and illimitable. Especially is
it so under a modern democratic framework
where the demands of society and of nations
have multiplied to almost unimaginable
proportions; the field and scope of police
power has become almost boundless, just as
the fields of public interest and public welfare
have become almost all-embracing and have
transcended human foresight. However, the
Constitution has set forth limitations thereof
and the most important of these are: the due
process clause and the equal protection
clause.
The conflict, therefore, between police power
and the guarantees of due process and equal
protection of the laws is more apparent than
real. Properly related, the power and the
guarantees are supposed to coexist. The
balancing is the essence or, shall it be said,
the indispensable means for the attainment of
legitimate aspirations of any democratic
society. There can be no absolute power,
whoever exercise it, for that would be tyranny.
Yet there can neither be absolute liberty, for
that would mean license and anarchy. So the
State can deprive persons of life, liberty and
property, provided there is due process of law;
and persons may be classified into classes
and groups, provided everyone is given the
equal protection of the law. The test or
standard, as always, is reason. The police
power legislation must be firmly grounded on
public interest and welfare, and a reasonable
relation must exist between purposes and
means. And if distinction and classification
has been made, there must be a reasonable
basis for said distinction.
The best evidence to determine the alien
dominance in retail business are the statistics
on the retail trade, which put down the figures
in black and white. Between the constitutional
convention year (1935), when the fear of alien
domination and control of the retail trade
already filled the minds of our leaders with
fears and misgivings, and the year of the
enactment of the nationalization of the retail
trade act (1954), official statistics
unmistakably point out to the ever-increasing
dominance and control by the alien of the
retail trade. Statistical figures reveal that in
percentage distribution of assets and gross
sales, alien participation has steadily
increased during the years. It is true, of
course, that Filipinos have the edge in the
number of retailers, but aliens more than
make up for the numerical gap through their
assets and gross sales which average
between six and seven times those of the very
many Filipino retailers.
The Court finds that law does not also violate
the equal protection clause of the Constitution
because sufficient grounds exist for the
distinction between alien and citizen in the
exercise of the occupation regulated, nor the
due process of law clause, because the law is
prospective in operation and recognizes the
privilege of aliens already engaged in the
occupation and reasonably protects their
privilege. The wisdom and efficacy of the law
to carry out its objectives appear to us to be
plainly evident — as a matter of fact it seems
not only appropriate but actually necessary —
and that in any case such matter falls within
the prerogative of the Legislature, with whose
power and discretion the Judicial department
of the Government may not interfere.
Therefore, petition is denied.
WALTER LUTZ, vs. J. ANTONIO ARANETA
G.R. No. L-7859 December 22, 1955
FACTS:
Appelant in this case Walter Lutz in his
capacity as the Judicial Administrator of the
intestate of the deceased Antonio Jayme
Ledesma, seeks to recover from the Collector
of the Internal Revenue the total sum of
fourteen thousand six hundred sixty six and
forty cents (P 14, 666.40) paid by the estate
as taxes, under section 3 of Commonwealth
Act No. 567, also known as the Sugar
Adjustment Act, for the crop years 1948-1949
and 1949-1950.
Commonwealth Act. 567 Section 2 provides
for an increase of the existing tax on the
manufacture of sugar on a graduated basis,
on each picul of sugar manufacturer; while
section 3 levies on the owners or persons in
control of the land devoted tot he cultivation of
sugarcane and ceded to others for
consideration, on lease or otherwise - "a tax
equivalent to the difference between the
money value of the rental or consideration
collected and the amount representing 12 per
centum of the assessed value of such land.
It was alleged that such tax is unconstitutional
and void, being levied for the aid and support
of the sugar industry exclusively, which in
plaintiff's opinion is not a public purpose for
which a tax may be constitutionally levied. The
action was dismissed by the CFI thus the
plaintiff appealed directly to the Supreme
Court.
ISSUE:
Whether or not the tax imposition in the
Commonwealth Act No. 567 are
unconstitutional.
HELD:
Yes, the Supreme Court held that the fact that
sugar production is one of the greatest
industry of our nation, sugar occupying a
leading position among its export products;
that it gives employment to thousands of
laborers in the fields and factories; that it is a
great source of the state's wealth, is one of
the important source of foreign exchange
needed by our government and is thus pivotal
in the plans of a regime committed to a policy
of currency stability. Its promotion, protection
and advancement, therefore redounds greatly
to the general welfare.
Hence it was competent for the legislature to
find that the general welfare demanded that
the sugar industry be stabilized in turn; and in
the wide field of its police power, the law-
making body could provide that the
distribution of benefits therefrom be
readjusted among its components to enable it
to resist the added strain of the increase in
taxes that it had to sustain.
The subject tax is levied with a regulatory
purpose, to provide means for the
rehabilitation and stabilization of the
threatened sugar industry. In other words, the
act is primarily a valid exercise of police
power.
HON. JEJOMAR C. BINAY and the
MUNICIPALITY OF MAKATI vs. HON.
EUFEMIO DOMINGO and the COMMISSION
ON AUDIT
G.R. No. 92389 September 11, 1991
FACTS:
Petitioner Municipality of Makati, through its
Council, approved Resolution No. 60 which
extends P500 burial assistance to bereaved
families whose gross family income does not
exceed P2,000.00 a month. The funds are to
be taken out of the unappropriated available
funds in the municipal treasury. The Metro
Manila Commission approved the resolution.
Thereafter, the municipal secretary certified a
disbursement of P400,000.00 for the
implementation of the program. However, the
Commission on Audit disapproved said
resolution and the disbursement of funds for
the implementation thereof for the following
reasons: (1) the resolution has no connection
to alleged public safety, general welfare,
safety, etc. of the inhabitants of Makati; (2)
government funds must be disbursed for
public purposes only; and, (3) it violates the
equal protection clause since it will only
benefit a few individuals.
ISSUES:
1. Whether Resolution No. 60 is a valid
exercise of the police power under the
general welfare clause;
2. Whether the questioned resolution is for
a public purpose; and
3. Whether the resolution violates the
equal protection clause
HELD:
1. The police power is a governmental
function, an inherent attribute of sovereignty,
which was born with civilized government. It is
founded largely on the maxims, "Sic utere tuo
et ahenum non laedas and "Salus populi est
suprema lex. Its fundamental purpose is
securing the general welfare, comfort and
convenience of the people.
Police power is inherent in the state but not in
municipal corporations. Before a municipal
corporation may exercise such power, there
must be a valid delegation of such power by
the legislature which is the repository of the
inherent powers of the State.
Municipal governments exercise this power
under the general welfare clause. Pursuant
thereto they are clothed with authority to
"enact such ordinances and issue such
regulations as may be necessary to carry out
and discharge the responsibilities conferred
upon it by law, and such as shall be
necessary and proper to provide for the
health, safety, comfort and convenience,
maintain peace and order, improve public
morals, promote the prosperity and general
welfare of the municipality and the inhabitants
thereof, and insure the protection of property
therein.
2. Police power is not capable of an exact
definition but has been, purposely, veiled in
general terms to underscore its all
comprehensiveness. Its scope, over-
expanding to meet the exigencies of the
times, even to anticipate the future where it
could be done, provides enough room for an
efficient and flexible response to conditions
and circumstances thus assuring the greatest
benefits.
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.
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, the promotion of the general
welfare, social justice as well as human
dignity and respect for human rights." 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.
3. There is no violation of the equal protection
clause. 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. Resolution No. 60, re-enacted under
Resolution No. 243, of the Municipality of
Makati is a paragon of the continuing program
of our government towards social justice. The
Burial Assistance Program is a relief of
pauperism, though not complete. The loss of a
member of a family is a painful experience,
and it is more painful for the poor to be
financially burdened by such death.
Resolution No. 60 vivifies the very words of
the late President Ramon Magsaysay 'those
who have less in life, should have more in
law." This decision, however must not be
taken as a precedent, or as an official go-
signal for municipal governments to embark
on a philanthropic orgy of inordinate dole-outs
for motives political or otherwise.
ORTIGAS & CO. LTD.vs. THE COURT OF
APPEALS and ISMAEL G. MATHAY III
G.R. No. 126102 December 4, 2000
FACTS:
In 1981, the Metropolitan Manila Commission
(now MMDA) enacted an Ordinance
reclassified as a commercial area a portion of
Ortigas Avenue from Madison to Roosevelt
Streets of Greenhills Subdivision where the lot
is located. In 1984, private respondent leased
the lot and constructed a single story
commercial building for Greenhills Autohaus,
Inc., a car sales company.
In 1995, petitioner filed a complaint against
the owner of the lot with the RTC, 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
TRO and injunction to prohibit petitioner from
in engaging a commercial activity on the lot
while the trial court issued and denied the MR
of the private Respondent.
Private Respondent filed with the CA a special
civil action for certiorari, ascribing to the trial
court grave abuse of discretion which the
appellate court granted. Complainant
seasonably moved for reconsideration, but the
appellate court denied it, hence this petition.
ISSUE:
Whether the retroactive effect of the assailed
ordinance violates the Right to Non-
Impairment of Contracts of the complainants?
HELD:
No, In general, the court 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.
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. Moreover, statutes in
exercise of valid police power must be read
into every contract.
The contractual stipulations annotated on the
Torrens Title, on which Ortigas relies, must
yield to the ordinance. When that stretch of
Ortigas Avenue from Roosevelt Street to
Madison Street was reclassified as a
commercial zone by the Metropolitan Manila
Commission in March 1981, the restrictions in
the contract of sale between Ortigas and
Hermoso, limiting all construction on the
disputed lot to single-family residential
buildings, were deemed extinguished by the
retroactive operation of the zoning ordinance
and could no longer be enforced.
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.” Otherwise such stipulations
would be deemed null and void.
JAMES MIRASOL, RICHARD SANTIAGO,
and LUZON MOTORCYCLISTS
FEDERATION, INC. vs. DPWH and TOLL
REGULATORY BOARD
G.R. No. 158793 June 8, 2006
FACTS:
Petitioners filed before the court a petition for
declaratory judgment with application for
temporary restraining order and injunction. It
seeks the declaration of nullification of
administrative issuances for being
inconsistent with the provisions of Republic
Act 2000 (Limited Access Highway Act) which
was enacted in 1957.
Previously, pursuant to its mandate under RA
2000, DPWH issued on June 25, 1998 Dept.
Order no. 215 declaring the Manila Cavite
(Coastal Road) Toll Expressway as limited
access facilities.
Petitioners filed an Amended Petition on
February 8, 2001 wherein petitioners sought
the declaration of nullity of the aforesaid
administrative issuances.
The petitioners prayed for the issuance of a
temporary restraining order to prevent the
enforcement of the total ban on motorcycles
along NLEX, SLEX, Manila-Cavite (Coastal
Road) toll Expressway under DO 215.
RTC, after due hearing, granted the
petitioner’s application for preliminary
injunction conditioned upon petitioner’s filing
of cash bond in the amount of P100, 000
which petitioners complied.
DPWH issued an order (DO 123) allowing
motorcycles with engine displacement of 400
cubic centimeters inside limited access
facilities (toll ways).
Upon assumption of Hon. Presiding Judge
Cornejo, both the petitioners and respondents
were required to file their Memoranda.
The court issued an order dismissing the
petition but declaring invalid DO 123.The
petitioners moved for reconsideration but it
was denied.
RTC ruled that DO 74 is valid but DO 123 is
invalid being violative of the equal protection
clause of the Constitution
ISSUES :
1. Whether DO 74, DO 215 and the TRB
regulation contravene RA 2000.
2. Whether AO 1 is unconstitutional.
HELD:
1. YES. The petitioners claimed that DO 74,
DO 215 and TRB’s rules and regulation
issued under them unduly expanded the
power of the DPWH in sec. 4 of RA 2000 to
regulate toll ways. They contend that
DPWH’s regulatory authority is limited to acts
like redesigning curbings or central dividing
sections.
They claim that DPWH is only allowed to
redesign the physical structure of toll ways
and not to determine “who or what can be
qualifies as toll ways user”.
The court ruled that DO 74 and DO 215 are
void because the DPWH has no authority to
declare certain expressways as limited access
facilities. Under the law, it is the DOTC which
is authorized to administer and enforce all
laws, rules and regulations in the field of
transportation and to regulate related
activities.
Since the DPWH has no authority to regulate
activities relative to transportation, the Toll
Regulatory Board (TRB) cannot derive its
power from the DPWH to issue regulations
governing limited access facilities.
The DPWH cannot delegate a power or
function which it does not possess in the first
place.
2. NO. The Court emphasized that the
secretary of the then Department of Public
Works and Communications had issued AO 1
in February 1968, as authorized under Section
3 of Republic Act 2000, prior to the splitting of
the department and the eventual devolution of
its powers to the DOTC.
Because administrative issuances had the
force and effect of law, AO 1 enjoyed the
presumption of validity and constitutionality.
The burden to prove its unconstitutionality
rested on the party assailing it, more so when
police power was at issue and passed the test
of reasonableness. The Administrative Order
was not oppressive, as it did not impose
unreasonable restrictions or deprive
petitioners of their right to use the facilities. It
merely set rules to ensure public safety and
the uninhibited flow of traffic within those
limited-access facilities.
The right to travel did not mean the right to
choose any vehicle in traversing a tollway.
Petitioners were free to access the tollway as
much as the rest of the public. However, the
mode in which they wished to travel,
pertaining to their manner of using the tollway,
was a subject that could validly be limited by
regulation. There was no absolute right to
drive; on the contrary, this privilege was
heavily regulated.
CARLOS SUPERDRUG CORP. vs. DSWD,
et. al.
G.R. No. 166494 June 29, 2007
FACTS:
Petitioners are domestic corporations and
proprietors operating drugstores in the
Philippines. Public respondents, on the other
hand, include the DSWD, DOH, DOF, DOJ,
and the DILG, specifically tasked to monitor
the drugstores’ compliance with the law;
promulgate the implementing rules and
regulations for the effective implementation of
the law; and prosecute and revoke the
licenses of erring drugstore establishments.
President Gloria Macapagal-Arroyo signed
into law R.A. No. 9257 otherwise known as
the “Expanded Senior Citizens Act of 2003.”
Sec. 4(a) of the Act states that The
senior citizens shall be entitled to the
following: (a) the grant of twenty percent
(20%) discount from all establishments
relative to the utilization of services in
hotels and similar lodging
establishments, restaurants and
recreation centers, and purchase of
medicines in all establishments for the
exclusive use or enjoyment of senior
citizens, including funeral and burial
services for the death of senior citizens;
Petitioners assert that Section 4(a) of the law
is unconstitutional because it constitutes
deprivation of private property. Compelling
drugstore owners and establishments to grant
the discount will result in a loss of profit and
capital because according to them drugstores
impose a mark-up of only 5% to 10% on
branded medicines, and the law failed to
provide a scheme whereby drugstores will be
justly compensated for the discount.
ISSUE:
WON RA 9257 is constitutional.
HELD:
YES. The law is a legitimate exercise of police
power which, similar to the power of eminent
domain, has general welfare for its object.
Police power is not capable of an exact
definition, but has been purposely veiled in
general terms to underscore its
comprehensiveness to meet all exigencies
and provide enough room for an efficient and
flexible response to conditions and
circumstances, thus assuring the greatest
benefits.
Accordingly, it has been described as the
most essential, insistent and the least limitable
of powers, extending as it does to all the great
public needs. It is [t]he power vested in the
legislature by the constitution 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 of the subjects of the
same.
For this reason, when the conditions so
demand as determined by the legislature,
property rights must bow to the primacy of
police power because property rights, though
sheltered by due process, must yield to
general welfare.
Police power as an attribute to promote the
common good would be diluted considerably if
on the mere plea of petitioners that they will
suffer loss of earnings and capital, the
questioned provision is invalidated. Moreover,
in the absence of evidence demonstrating the
alleged confiscatory effect of the provision in
question, there is no basis for its nullification
in view of the presumption of validity which
every law has in its favor.
Given these, it is incorrect for petitioners to
insist that the grant of the senior citizen
discount is unduly oppressive to their
business, because petitioners have not taken
time to calculate correctly and come up with a
financial report, so that they have not been
able to show properly whether or not the tax
deduction scheme really works greatly to their
disadvantage.
In treating the discount as a tax deduction,
petitioners insist that they will incur losses.
However,petitioner’s computation is clearly
flawed. For purposes of reimbursement, the
law states that the cost of the discount shall
be deducted from gross income, the amount
of income derived from all sources before
deducting allowable expenses, which will
result in net income.
Here, petitioners tried to show a loss on a per
transaction basis, which should not be the
case. An income statement, showing an
accounting of petitioners sales, expenses, and
net profit (or loss) for a given period could
have accurately reflected the effect of the
discount on their income. Absent any financial
statement, petitioners cannot substantiate
their claim that they will be operating at a loss
should they give the discount. In addition, the
computation was erroneously based on the
assumption that their customers consisted
wholly of senior citizens. Lastly, the 32% tax
rate is to be imposed on income, not on the
amount of the discount.
While the Constitution protects property rights,
petitioners must accept the realities of
business and the State, in the exercise of
police power, can intervene in the operations
of a business which may result in an
impairment of property rights in the process.

DEPARTMENT OF EDUCATION, CULTURE
AND SPORTS (DECS) and DIRECTOR OF
CENTER FOR EDUCATIONAL
MEASUREMENT vs. ROBERTO REY C.
SAN DIEGO and JUDGE TERESITA DIZON-
CAPULONG
G.R. No. 89572 December 21, 1989
FACTS:
The private respondent is a graduate of the
University of the East with a degree of
Bachelor of Science in Zoology. The petitioner
claims that he took the NMAT three times and
flunked it as many times. When he applied to
take it again, the petitioner rejected his
application on the basis of the aforesaid rule.
He then went to the Regional Trial Court of
Valenzuela, Metro Manila, to compel his
admission to the test. In his original petition for
mandamus, he first invoked his constitutional
rights to academic freedom and quality
education. By agreement of the parties, the
private respondent was allowed to take the
NMAT scheduled on April 16, 1989, subject to
the outcome of his petition.
In an amended petition filed with leave of
court, he squarely challenged the
constitutionality of MECS Order No. 12, Series
of 1972, containing the above-cited rule. The
additional grounds raised were due process
and equal protection. After hearing, the
respondent judge rendered a decision on July
4, 1989, declaring the challenged order invalid
and granting the petition.
Judge Teresita Dizon-Capulong held that the
petitioner had been deprived of his right to
pursue a medical education through an
arbitrary exercise of the police power. We
cannot sustain the respondent judge. Her
decision must be reversed.
ISSUE:
Whether a person who has thrice failed the
National Medical Admission Test (NMAT) is
entitled to take it again. If not allowed, is there
arbitrary exercise of the police power.
HELD:
No. He cannot and it is not an arbitrary
exercise of police power, thus, he is not
deprived of his right to pursue medical
education.
The petitioner contends he may not, under its
rule that a student shall be allowed only three
(3) chances to take the NMAT. After three (3)
successive failures, a student shall not be
allowed to take the NMAT for the fourth time.
The proper exercise of the police power
requires the concurrence of a lawful subject
and a lawful method. The subject of the
challenged regulation is certainly within the
ambit of the police power. It is the right and
indeed the responsibility of the State to insure
that the medical profession is not infiltrated by
incompetents to whom patients may unwarily
entrust their lives and health.
The method employed by the challenged
regulation is not irrelevant to the purpose of
the law nor is it arbitrary or oppressive. The
three-flunk rule is intended to insulate the
medical schools and ultimately the medical
profession from the intrusion of those not
qualified to be doctors. The right to quality
education invoked by the private respondent
is not absolute. The Constitution also provides
that "every citizen has the right to choose a
profession or course of study, subject to fair,
reasonable and equitable admission and
academic requirements.
The Court feels that it is not enough to simply
invoke the right to quality education as a
guarantee of the Constitution: one must show
that he is entitled to it because of his
preparation and promise. The private
respondent has failed the NMAT five times.
While his persistence is noteworthy, to say the
least, it is certainly misplaced, like a hopeless
love.
PRC, et.al. vs. ARLENE V. DE GUZMAN,
et.al.
G.R. No. 144681 June 21, 2004
FACTS:
After the Professional Regulations
Commission (PRC) released the names of
successful examinees in the Medical
Licensure Examination, the Board of Medicine
observed that the grades of the 79 Fatima
College of Medicine successful examinees
were unusually and exceptionally high in the
two (2) most difficult subjects of the exam, i.e.,
Biochemistry and Obstetrics and Gynecology.
The Board then issued Resolution No. 19
withholding the registration as physicians of all
the examinees from Fatima College of
Medicine. As noted by PRC’s statistician
consultant, Fr. Nebres of ADMU, compared
with other examinees from other schools, the
results of those from Fatima were not only
incredibly high but unusually clustered close
to each other. The NBI Investigation
concluded that the Fatima examinees gained
early access to the test questions.
On July 5, 1993, the respondents-examinees
filed a petition for mandamus before the RTC
of Manila to compel the PRC to give them
their licenses to practice medicine. Meanwhile
on July 21, 1993, the Board of Medicine
issued Resolution No. 21 charging the
respondents of immorality, dishonest conduct,
fraud and deceit and recommended that the
test results of the Fatima Examinees be
nullified.
On December 19, 1994, the RTC of Manila
promulgated its decision ordering the PRC to
allow the respondents to take the physician’s
oath and to register them as physicians. The
same was appealed by the PRC to the Court
of Appeals which sustained the RTC decision.
Hence, this petition.
ISSUES:
1. WON it is a ministerial duty for the Board of
Medicine to issue certificates of registration as
physicians under RA 2382
2. WON the respondent-examinees have the
right to be registered as physicians
HELD:
1. A careful reading of Section 20 of the
Medical Act of 1959 discloses that the law
uses the word “shall” with respect to the
issuance of certificates of registration. Thus,
the petitioners “shall sign and issue
certificates of registration to those who have
satisfactorily complied with the requirements
of the Board.” In statutory construction the
term “shall” is a word of command. It is given
imperative meaning. Thus, when an examinee
satisfies the requirements for the grant of his
physician’s license, the Board is obliged to
administer to him his oath and register him as
a physician, pursuant to Section 20 and par.
(1) of Section 22 of the Medical Act of 1959.
However, the surrounding circumstances in
this case call for serious inquiry concerning
the satisfactory compliance with the Board
requirements by the respondents.
Section 8 of Rep. Act No. 2382 prescribes,
among others, that a person who aspires to
practice medicine in the Philippines, must
have “satisfactorily passed the corresponding
Board Examination.” Section 22, in turn,
provides that the oath may only be
administered “to physicians who qualified in
the examinations.” The operative word here is
“satisfactorily,” defined as “sufficient to meet a
condition or obligation” or “capable of
dispelling doubt or ignorance.” Gleaned from
Board Resolution No. 26, the licensing
authority apparently did not find that the
respondents “satisfactorily passed” the
licensure examinations. The Board instead
sought to nullify the examination results
obtained by the respondents.
2. It is long established rule that a license to
practice medicine is a privilege or franchise
granted by the government. It is true that this
Court has upheld the constitutional right of
every citizen to select a profession or course
of study subject to a fair, reasonable, and
equitable admission and academic
requirements. But like all rights and freedoms
guaranteed by the Charter, their exercise may
be so regulated pursuant to the police power
of the State to safeguard health, morals,
peace, education, order, safety, and general
welfare of the people. Thus, persons who
desire to engage in the learned professions
requiring scientific or technical knowledge
may be required to take an examination as a
prerequisite to engaging in their chosen
careers. This regulation takes particular
pertinence in the field of medicine, to protect
the public from the potentially deadly effects of
incompetence and ignorance among those
who would practice medicine.
qualifications and none of the
disqualifications.
Furthermore, it must appear that he has fully
complied with all the conditions and
requirements imposed by the law and the
licensing authority. Should doubt taint or mar
the compliance as being less than
satisfactory, then the privilege will not issue.
For said privilege is distinguishable from a
matter of right, which may be demanded if
denied. Thus, without a definite showing that
the aforesaid requirements and conditions
have been satisfactorily met, the courts may
not grant the writ of mandamus to secure said
privilege without thwarting the legislative will.

Hence, until the moral and mental fitness of
the respondents could be ascertained, the
Board has discretion to hold in abeyance the
administration of the Hippocratic Oath and the
issuance of the certificates to them. The writ
of mandamus does not lie to compel
performance of an act which is not duly
authorized.
In the present case, RA 2382, as amended,
prescribed the requirements for admission to
the practice of medicine, the qualifications of
candidates for the board examinations, the
scope and conduct of the examinations, the
grounds for denying the issuance of a
physician’s license, or revoking a license that ST. LUKE'S MEDICAL CENTER
has been issued. Verily, to be granted the EMPLOYEE'S ASSOCIATION-AFW
privilege to practice medicine, the applicant (SLMCEA-AFW) AND MARIBEL S.
must show that he possesses all the
 SANTOS, vs. NLRC AND ST. LUKE'S
MEDICAL CENTER, INC.
G.R. No. 162053 March 7, 2007
FACTS::
Congress passed and enacted Republic Act
No. 7431 known as the “Radiologic
Technology Act of 1992.” Said law requires
that no person shall practice or offer to
practice as a radiology and/or x-ray
technologist in the Philippines without having
obtained the proper certificate of registration
from the Board of Radiologic Technology.
Petitioner Maribel Santos was hired as X-Ray
Technician in the Radiology department of
private respondent St. Luke’s Medical Center,
Inc. (SLMC).
Pursuant to RA 7431 the assistant Executive
Director-Ancillary Services and HR Director of
private respondent SLMC issued a final notice
to all practitioners of Radiologic Technology to
comply with the requirement otherwise, the
unlicensed employee will be transferred to an
area which does not require a license to
practice if a slot is available.
The Director of the Institute of Radiology
issued another memorandum to petitioner
Maribel S. Santos advising her that only a
license can assure her of her continued
employment at the Institute of Radiology of
the private respondent SLMC and that the
latter is giving her the last chance to take and
pass the forthcoming board examination
scheduled in June 1998; otherwise, private
respondent SLMC shall be constrained to take
action which may include her separation from
employment.
On November 23, 1998, the Director of the
Institute of Radiology issued a notice to
petitioner Maribel S. Santos informing the
latter that the management of private
respondent SLMC has approved her
retirement in lieu of separation pay. SLMC
issued a “Notice of Separation from the
Company” to petitioner Maribel S. Santos
effective December 30, 1998 in view of the
latter’s refusal to accept private respondent
SLMC’s offer for early retirement.
Petitioner Maribel Santos files a complaint
against private respondent illegal dismissal
and non-payment of salaries, allowances and
other monetary benefits. She further contends
that her failure to pass the board licensure
exam for exam for X-ray technicians did not
constitute just cause for termination as it
violated her constitutional right to security of
tenure. The appellate court finds this
contention untenable, hence this petition for
certiorari.
ISSUE:
Whether or not the petitioner is legally
dismissed pursuant to R.A. 7431 exercising
police power of the State.
HELD:
Yes, the petitioner dismissal is valid due to her
inability to secure a certificate of registration
from Board of Radiologic Technology.
While the right of workers to security of tenure
is guaranteed by the Constitution, its exercise
may be reasonably regulated pursuant to the
police power of the State to safeguard health,
morals, peace, education, order, safety, and
the general welfare of the people.
Consequently, persons who desire to engage
in the learned professions requiring scientific
or technical knowledge may be required to
take an examination as a prerequisite to
engaging in their chosen careers.
The state is justified in prescribing the specific
requirements for x-ray technicians and/or any
other professions connected with the health
and safety of its citizens. Respondent being
engaged in the hospital and health care
business, is a proper subject of the cited law;
thus, having in mind the legal requirements of
these laws, the latter cannot close its eyes
and complainant private interest override
public interest. The law is clear that the
Certificate of Registration cannot be MINERS ASSOCIATION OF THE
substituted by any other requirement to allow PHILIPPINES, INC. vs. HON. FULGENCIO
a person to practice as a Radiologic S. FACTORAN, JR.
Technologist and/or X-ray Technologist
(Technician). G.R. No. 98332 January 16, 1995
FACTS:
Former President Corazon Aquino issued
Executive Order Nos 211 and 279 in the
exercise of her legislative powers. EO No. 211
prescribes the interim procedures in the
processing and approval of applications for
the exploration, development and utilization of
minerals pursuant to Section 2, Article XII of
the 1987 Constitution. EO No. 279 authorizes
the DENR Secretary to negotiate and
conclude joint-venture, co-production, or
production- sharing agreements for the
exploration, development, and utilization of
mineral resources.
The issuance and the impeding
implementation by the DENR of Administrative
Order Nos. 57 which declares that all existing
mining leases or agreements which were
granted after the effectivity of the 1987
Constitution...shall be converted into
production-sharing agreements within one (1)
year from the effectivity of these guidelines.”
and Administrative Order No. 82 which
provides that a failure to submit Letter of
Intent and Mineral Production-Sharing
Agreement within 2 years from the effectivity
of the Department Administrative Order No.
57 shall cause the abandonment of the
mining, quarry, and sand and gravel claims,
after their respective effectivity dates
compelled the Miners Association of the
Philippines, Inc., an organization composed of
mining prospectors and claim owners and
claim holders, to file the instant petition
assailing their validity and constitutionality
before this Court.
ISSUE :
Whether or not the two Department
Administrative Orders are valid.
HELD :
Yes. Petitioner's insistence on the application
of Presidential Decree No. 463, as amended,
as the governing law on the acceptance and
approval of declarations of location and all
other kinds of applications for the exploration,
development, and utilization of mineral
resources pursuant to Executive Order No.
211, is erroneous. Presidential Decree No.
463, as amended, pertains to the old system
of exploration, development and utilization of
natural resources through "license,
concession or lease" which, however, has
been disallowed by Article XII, Section 2 of the
1987 Constitution. By virtue of the said
constitutional mandate and its implementing
law, Executive Order No. 279 which
superseded Executive Order No. 211, the
provisions dealing on "license, concession or
lease" of mineral resources under Presidential
Decree No. 463, as amended, and other
existing mining laws are deemed repealed
and, therefore, ceased to operate as the
governing law.
In other words, in all other areas of
administration and management of mineral
lands, the provisions of Presidential Decree
No. 463, as amended, and other existing
mining laws, still govern. Section 7 of
Executive Order No. 279 provides, thus:
Sec. 7. All provisions of Presidential
Decree No. 463, as amended, other
existing mining laws, and their
implementing rules and regulations, or
parts thereof, which are not inconsistent
with the provisions of this Executive
Order, shall continue in force and effect.
Well -settled is the rule, however, that
regardless of the reservation clause, mining
leases or agreements granted by the State,
such as those granted pursuant to Executive
Order No. 211 referred to this petition, are
subject to alterations through a reasonable
exercise of the police power of the State.
Accordingly, the State, in the exercise of its
police power in this regard, may not be
precluded by the constitutional restriction on
non-impairment of contract from altering,
modifying and amending the mining leases or
agreements granted under Presidential
Decree No. 463, as amended, pursuant to
Executive Order No. 211.
Police Power, being co-extensive with the
necessities of the case and the demands of
public interest; extends to all the vital public
needs. The passage of Executive Order No.
279 which superseded Executive Order No.
211 provided legal basis for the DENR
Secretary to carry into effect the mandate of
Article XII, Section 2 of the 1987 Constitution.
Hence, the petition is dismissed for lack of
merit.
HON. EXECUTIVE SECRETARY, et.al. vs.
SOUTHWING HEAVY INDUSTRIES
G.R. No. 164171 February 20, 2006
FACTS;
Executive Order No. 156 (EO 156), issued by
President Gloria Macapagal-Arroyo (President
Arroyo) on 12 December 2002, imposes a ban
on the importation of used motor vehicles,
with a few exceptions. The ban is part of
several measures EO 156 adopts to
“accelerate the sound development of the
motor vehicle industry in the Philippines.” In
issuing EO 156, particularly the prohibition on
importation under Article 2, Section 3.1, the
President envisioned to rationalize the
importation of used motor vehicles and to
enhance the capabilities of the Philippine
motor manufacturing firms to be globally
competitive producers of completely build-up
units and their parts and components for the
local and export markets.
EO 156 is assailed on the ground that it has
no constitutional and statutory bases.

ISSUES:
1. Whether or not such ban on importation
of used motor vehicles as embodied in
Article 2, Sec. 3.1 of EO 156
constitutional; and
2. Whether the ban is applicable against
importations of used motor vehicles in
the Freeport (Subic Bay Freeport)
HELD:
1. Yes, it is constitutional because it is a
valid exercise of a delegated police
power. Said EO 156 finds basis on
Section 28(2) of Article VI of the
Constitution which provides that “the
Congress may, by law, authorize the
President to fix within specified limits,
and subject to such limitations and
restrictions as it may impose, tariff rates,
import and export quotas, tonnage and
wharfage dues, and other duties or
imposts within the framework of the
national development program of the
Government.”
This constitutional provision is
implemented by certain legislations,
namely: the Tariff and Customs Code
and Executive Order No. 226, the
Omnibus Investment Code of the
Philippines which was issued on July 16,
1987, by then President Corazon C.
Aquino. Under Section 401 of the Tariff
and Customs Code, the President, in the
interest of national economy, general
welfare and/or national security, to, inter
alia, is expressly authorized to prohibit
the importation of any commodity as
provided for under Section 401 thereof.
And under Article 7, paragraph 12 of the
Omnibus Investment Code of the
Philippines, the President is empowered
to approve or reject the prohibition on
the importation of any equipment or raw
materials or finished products.
There is no doubt that the issuance of
the ban to protect the domestic industry
is a reasonable exercise of police
power. The deterioration of the local
motor manufacturing firms due to the
influx of imported used motor vehicles is
an urgent national concern that needs to
be swiftly addressed by the President. In
the exercise of delegated police power,
the executive can therefore validly
proscribe the importation of these
vehicles.
2. No. The subject matter of the laws
(Tariff and Customs Code, Omnibus
Investment Code) authorizing the
President to regulate or forbid
importation of used motor vehicles, is
the domestic industry. EO 156 cannot
be applied against the importation of
used cars to the Freeport, which RA
7227, considers to some extent, a
foreign territory. The domestic industry
which the EO seeks to protect is actually
the “customs territory” which is defined
under the Rules and Regulations
Implementing RA 7227, as follows: “the
portion of the Philippines outside the
Subic Bay Freeport where the Tariff and
Customs Code of the Philippines and
other national tariff and customs laws
are in force and effect.”
The proscription in the importation of RA 7227 which is to create a market that (3) It cannot sell reading and similar
used motor vehicles should be operative would draw investors and ultimately eyeglasses without a prescription having
only outside the Freeport and the boost the national economy. first been made by an independent
inclusion of said zone within the ambit of optometrist or independent optical clinic.
the prohibition is an invalid modification Acebedo can only sell directly to the
of RA 7227. Indeed, when the public, without need of a prescription,
application of an administrative issuance ACEBEDO OPTICAL COMPANY v. CA Ray-Ban and similar eyeglasses;
modifies existing laws or exceeds the (4) It cannot advertise optical lenses and
intended scope, as in the instant case, G.R. No. 100152 March 31, 2000 eyeglasses, but can advertise Ray-Ban
the issuance becomes void, not only for and similar glasses and frames;and
FACTS:
being ultra vires, but also for being
unreasonable. (5) It is allowed to grind lenses but only
Petitioner applied with the Office of the City
upon the prescription of an independent
Mayor of Iligan for a business permit. After
As long as the used motor vehicles do optometrist.
consideration of petitioner's application and
not enter the customs territory, the injury
the opposition interposed thereto by local
or harm sought to be prevented or On December 5, 1988, private respondent
optometrists, respondent City Mayor issued
remedied will not arise. The application Samahan ng Optometrist Sa Pilipinas (SOPI
Business Permit No. 5342 subject to the
of the law should be consistent with the lodged a complaint against the petitioner
following conditions:
purpose of and reason for the law. alleging that Acebedo had violated the
(1) Since it is a corporation, Acebedo
Ratione cessat lex, et cessat lex. When conditions set forth in its business permit and
cannot put up an optical clinic but
the reason for the law ceases, the law requesting the cancellation and/or revocation
only a commercial store;
ceases. It is not the letter alone but the of such permit.
spirit of the law also that gives it life. To
(2) It cannot examine and/or prescribe
apply the proscription to the Freeport On July 19, 1989, the City Mayor sent
reading and similar optical glasses for
would not serve the purpose of the EO. petitioner a Notice of Resolution and
patients, because these are functions of
Instead of improving the general Cancellation of Business Permit effective as of
optical clinics;
economy of the country, the application said date and giving petitioner three (3)
of the importation ban in the Freeport months to wind up its affairs.
would subvert the avowed purpose of
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.
HELD:
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. It 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. 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.
In the case under consideration, 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.
Public respondents and private respondent
SOPI are one in saying that the imposition of
said special conditions is well within the
authority of the City Mayor as a valid exercise
of police power.
The issuance of business licenses and
permits by a municipality or city is essentially
regulatory in nature. The authority, which
devolved upon local government units to issue
or grant such licenses or permits, is
essentially in the exercise of the police power
of the State within the contemplation of the
general welfare clause of the Local
Government Code.
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. 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. 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.
Hence, the petition is granted and the
respondent City Mayor is hereby ordered to
reissue petitioner's business permit in
accordance with law and with this disposition.
Note:
Doctrine: 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.
Requisites
1 - LAWFUL SUBJECT: The interests
of the public generally, as distinguished
from those of a particular class, require
the exercise of the police power
2 - LAWFUL MEANS: The means
employed are reasonably necessary for
the accomplishment of the purpose and
not unduly oppressive upon individuals
WHITE LIGHT CORPORATION, TITANIUM
CORPORATION and STA. MESA TOURIST
& DEVELOPMENT CORPORATION vs.
CITY OF MANILA, represented by DE
CASTRO, MAYOR ALFREDO S. LIM
G.R. No. 122846 January 20, 2009
FACTS:
In 1992, Mayor Alfredo S. Lim signed into law
the Ordinance No. 7744 that prohibits hotels,
motels, inns, lodging houses, pension houses
and similar establishments from offering short-
time admission, as well as pro-rated or “wash
up” rates or other similarly concocted terms, in
the City of Manila.
The apparent goal of the Ordinance is to
minimize if not eliminate the use of the
covered establishments for illicit sex,
prostitution, drug use and alike.
Petitioners White Light Corporation (WLC) et.
al. filed a petition on the ground that the
Ordinance directly affects their business
interests as operators of drive-in-hotels and
motels in Manila.
RTC ruled in favor of the petitioner.
CA reversed the decision and asserted that
the Ordinance is a valid exercise of police
power.
ISSUE:
WON the ordinance is constitutional.
HELD:
NO.The ordinance is null and void as it indeed
infringes upon individual liberty. It also violates
the due process clause which serves as a
guaranty for protection against arbitrary
regulation or seizure. The said ordinance
invades private rights. Note that not all who
goes into motels and hotels for wash up rate
are really there for obscene purposes only.
Some are tourists who needed rest or to
“wash up” or to freshen up.
Hence, the infidelity sought to be avoided by
the said ordinance is more or less subjected
only to a limited group of people. The SC
reiterates that individual rights may be
adversely affected only to the extent that may
fairly be required by the legitimate demands of
public interest or public welfare.
MAYOR PABLO P. MAGTAJAS & THE CITY
OF CAGAYAN DE ORO vs. PRYCE
PROPERTIES CORPORATION, INC. &
PHILIPPINE AMUSEMENT AND GAMING
CORPORATION
G.R. No. 111097 July 20, 1994
FACTS:
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.
PAGCOR decided to expand its operations to
Cagayan de Oro City. It leased a portion of a
building belonging to Pryce Properties
Corporations, Inc., renovated & equipped the
same, and prepared to inaugurate its casino
during the Christmas season.
Then Mayor Magtajas together with the city
legislators and civil organizations of the City of
Cagayan de Oro denounced such project.
In reaction to this project, the Sangguniang
Panlungsod of Cagayan de Oro City enacted
two (2) ordinances prohibiting the issuance of
a business permit and canceling existing
business permit to establishment for the
operation of casino (ORDINANCE NO. 3353)
and an ordinance prohibiting the operation of
casino and providing penalty for its violation.
(ORDINANCE NO. 3375-93).
Pryce assailed the ordinances before the
Court of Appeals, where it was joined by
PAGCOR as intervenor and supplemental
petitioner.
Court of Appeals declared the ordinances
invalid and issued the writ prayed for to
prohibit their enforcement. 1 Reconsideration
of this decision was denied against
petitioners.
Hence, this petition for review under Rule 45.
ISSUE:
WON Ordinance No. 3353 and Ordinance No.
3375-93 are a valid exercise of police power.
HELD:
NO. The ordinances enacted are invalid.
Ordinances should not contravene a statute.
Municipal governments are merely agents of
the National Government. Local Councils
exercise only delegated powers conferred by
Congress. The delegate cannot be superior to
the principal powers higher than those of the
latter. PD 1869 authorized casino gambling.
As a statute, it cannot be amended/nullified by
a mere ordinance.
As to petitioners attack on gambling as
harmful and immoral, the Court stressed that
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. That
is the prerogative of the political departments.
It is settled that questions regarding the
wisdom, morality, or practicability 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.
CARLOS BALACUIT, LAMBERTO TAN and
SERGIO YU CARCEL vs. COURT OF FIRST
INSTANCE OF AGUSAN DEL NORTE AND
BUTUAN CITY
G.R. No. L-38429 June 30, 1988
FACTS:
The Municipal Board of the City of Butuan
pass an ordinance penalizing any person,
group of persons, entity, or corporation
engaged in the business of selling admission
tickets to any movie or other public
exhibitions, games, contests, or other
performances to require children between
seven (7) and twelve (12) years of age to pay
full payment for admission tickets intended for
adults but should charge only one-half of the
value of the said tickets.
The Petitioners, theater owners, aggrieved by
said ordinance, they file a complaint before
the Court of First Instance of Agusan del
Norte and Butuan City assailing the
constitutionality of Ordinance No. 640.
The Court rendered judgment declaring
Ordinance No. 640 of the City of Butuan
constitutional and valid.
ISSUE:
WON Ordinance No. 640 is a valid exercise of
police power.
HELD:
No. Ordinance No. 640 infringes theater
owners’ right to property.
While it is true that a business may be
regulated, it is equally true that such
regulation must be within the bounds of
reason, that is, the regulatory ordinance must
be reasonable, and its provisions 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.
A police measure for the regulation of the
conduct, control and operation of a business
should not encroach upon the legitimate and
lawful exercise by the citizens of their property
rights. The right of the owner to fix a price at
which his property shall be sold or used is an
inherent attribute of the property itself and, as
such, within the protection of the due process
clause. Hence, the proprietors of a theater
have a right to manage their property in their
own way, to fix what prices of admission they
think most for their own advantage, and that
any person who did not approve could stay
away.
Ordinance No. 640 clearly invades the
personal and property rights of petitioners for
even if We could assume that, on its face, the
interference was reasonable, from the
foregoing considerations, it has been fully
shown that it is an unwarranted and unlawful
curtailment of the property and personal rights
of citizens. For being unreasonable and an
undue restraint of trade, it cannot, under the
guise of exercising police power, be upheld as
valid.
Wherefore, the decision of the trial court in
Special Civil Case No. 237 is REVERSED and
SET ASIDE and a new judgment is hereby
rendered declaring Ordinance No. 640
unconstitutional and, therefore, null and void.
LEOVILLO C. AGUSTIN vs. HON. ROMEO
F. EDU, et.al.
G.R. No. L-49112 February 2, 1979
FACTS:
Petitioner, Agustin assails the validity of the
Letter of Instruction No. 229 which requires an
early warning device to be carried by users of
motor vehicles as being violative of the
constitutional guarantee of due process and
transgresses the fundamental principle of non-
delegation of legislative power.
Herein respondent Romeo Edu in his capacity
as Land Transportation Commisioner set forth
the implementing rules and regulations of the
said instruction.
Petitioner make known that he "is the owner of
a Volkswagen Beetle Car, Model 13035,
already properly equipped when it came out
from the assembly lines with blinking lights
fore and aft, which could very well serve as an
early warning device in case of the
emergencies mentioned in Letter of
Instructions No. 229, as amended, as well as
the implementing rules and regulations in
Administrative Order No. 1 issued by the land
transportation Commission,"
Furthermore, he contends that the law is "one-
sided, onerous and patently illegal and
immoral because [they] will make
manufacturers and dealers instant millionaires
at the expense of car owners who are
compelled to buy a set of the so-called early
warning device at the rate of P 56.00 to
P72.00 per set." are unlawful and
unconstitutional and contrary to the precepts
of a compassionate New Society [as being]
compulsory and confiscatory on the part of the
motorists who could very well provide a
practical alternative road safety device, or a
better substitute to the specified set of Early
Warning Device (EWD)."

This instruction, signed by President Marcos,
aims to prevent accidents on streets and
highways, including expressways or limited
access roads caused by the presence of
disabled, stalled or parked motor vehicles
without appropriate early warning devices.
The hazards posed by these disabled vehicles
are recognized by international bodies
concerned with traffic safety. The Philippines
is a signatory of the 1968 Vienna Convention
on Road Signs and Signals and the United
Nations Organizations and the said Vienna
Convention was ratified by the Philippine
Government under PD 207.
ISSUE:
WON the LOI 229 is invalid and violated
constitutional guarantees of due process.
HELD:
NO. The assailed Letter of Instruction was a
valid exercise of police power and there was
no unlawful delegation of legislative power on
the part of the respondent. As identified,
police power is a state authority to enact
legislation that may interfere personal liberty
or property in order to promote the general
welfare. In this case, the particular exercise of
police power was clearly intended to promote
public safety.
It cannot be disputed that the Declaration of
Principle found in the Constitution possesses
relevance: “The Philippines adopts the
generally accepted principles of international
law as part of the law of the nation.”
Thus, as impressed in the 1968 Vienna
Convention it is not for this country to
repudiate a commitment to which it had
pledged its word. Our country’s word was
resembled in our own act of legislative
ratification of the said Hague and Vienna MMDA vs. BEL-AIR VILLAGE
Conventions thru P.D. No. 207. ASSOCIATION, INC.
G.R. No. 135962 March 27, 2000
The concept of Pacta sunt servanda stands in
the way of such an attitude which is,
FACTS:
moreoever, at war with the principle of
international morality.
Metropolitan Manila Development Authority
(MMDA), petitioner herein, is a Government
Hence, the petition must be dismissed.
Agency 　 tasked with the delivery of basic
services in Metro Manila. Bel-Air Village
Association (BAVA), 　 respondent herein,
received a letter of request from the petitioner
to open Neptune Street of Bel-Air Village for
the use of the public. The said opening of
Neptune Street will be for the safe and
convenient movement of persons and to
regulate the flow of traffic in Makati City. This
was　pursuant to MMDA law or Republic Act
No. 7924.　On the same day, the respondent
was 　 appraised that the perimeter wall
separating the 　 subdivision and Kalayaan
Avenue would be　demolished.
The respondent, to stop the opening of the
said street and demolition of the wall, filed a
preliminary injunction and a temporary
restraining order. Respondent claimed that the
MMDA had 　 no authority to do so and the
lower court decided in favor of the
Respondent. Petitioner appealed 　 the
decision of the lower courts and claimed that it
has the authority to open Neptune Street to
public traffic because it is an agent of the
State that can 　 practice police power in the
delivery of　basic services in Metro Manila.
ISSUE:
Whether or not the MMDA has the mandate to
open Neptune Street to public traffic pursuant
to its regulatory and police powers.
HELD:
NO. The Court held that the MMDA does not
have the capacity to exercise police power.
Police power 　 is primarily lodged in the
National Legislature. However, police power
may be delegated to 　 government units.
Petitioner herein is a development authority
and not a political government 　 unit.
Therefore, the MMDA cannot exercise police
power because it cannot be delegated to
them.
It is not a legislative unit of the government.
Republic Act No. 7924 does not empower the
MMDA 　 to enact ordinances, approve
resolutions and appropriate funds for the
general welfare of the　inhabitants of Manila. MMDA v.. DANTE O. GARIN
There is no syllable in the said act that grants
G.R. No. 130230             April 15, 2005
MMDA police power.　It is an agency created
for the purpose of laying down policies and FACTS:
coordinating with various 　 national
government agencies, people’s organizations, The issue arose from an incident involving the
non-governmental organizations and the respondent Dante O. Garin, a lawyer, who
private sector for the efficient and expeditious was issued a traffic violation receipt (TVR) by
delivery of basic services in the vast MMDA and his driver's license confiscated for
metropolitan　area. parking illegally along Gandara Street,
Binondo, Manila, on August 1995.
Shortly before the expiration of the TVR's
validity, the respondent addressed a letter to
then MMDA Chairman Prospero Oreta
requesting the return of his driver's license,
and expressing his preference for his case to
be filed in court.
Receiving no immediate reply, Garin filed the
original complaint with application for
preliminary injunction, contending that, in the
absence of any implementing rules and
regulations, Sec. 5(f) of Rep. Act No. 7924
grants the MMDA unbridled discretion to
deprive erring motorists of their licenses, pre-
empting a judicial determination of the validity
of the deprivation, thereby violating the due
process clause of the Constitution.
The respondent further contended that the
provision violates the constitutional prohibition
against undue delegation of legislative
authority, allowing as it does the MMDA to fix
and impose unspecified — and therefore
unlimited — fines and other penalties on
erring motorists.
The trial court rendered the assailed decision
in favor of herein respondent.
ISSUE:
WON MMDA, through Sec. 5(f) of Rep. Act
No. 7924 could validly exercise police power.
HELD:
NO. The MMDA could not validly exercise
police power.
Police Power, having been lodged primarily in
the National Legislature, 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 (LGUs). Once delegated, the agents can
exercise only such legislative powers as are
conferred on them by the national lawmaking
body.
Our Congress delegated police power to the
LGUs in the Local Government Code of 1991.
15 A local government is a "political
subdivision of a nation or state which is
constituted by law and has substantial control
of local affairs." 16 Local government units are
the provinces, cities, municipalities and
barangays, which exercise police power
through their respective legislative bodies.
Metropolitan or Metro Manila is a body
composed of several local government units.
With the passage of Rep. Act No. 7924 in
1995, Metropolitan Manila was declared as a
"special development and administrative
region" and the administration of "metro-wide"
basic services affecting the region placed
under "a development authority" referred to as
the MMDA. Thus: The MMDA is, as termed in
the charter itself, a "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. All its
functions are administrative in nature and
these are actually summed up in the charter
itself:
* Section 5 of Rep. Act No. 7924
enumerates the "Functions and Powers
of the Metro Manila Development
Authority." The contested clause in Sec.
5(f) states that the petitioner shall "install
and administer a single ticketing system,
fix, impose and collect fines and
penalties for all kinds of violations of
traffic rules and regulations, whether
moving or non-moving in nature, and
confiscate and suspend or revoke
drivers' licenses in the enforcement of
such traffic laws and regulations, the
provisions of Rep. Act No. 4136 and
P.D. No. 1605 to the contrary
notwithstanding," and that "(f)or this
purpose, the Authority shall enforce all
traffic laws and regulations in Metro
Manila, through its traffic operation
center, and may deputize members of
the PNP, traffic enforcers of local
government units, duly licensed security
guards, or members of non-
governmental organizations to whom
may be delegated certain authority,
subject to such conditions and
requirements as the Authority may
impose."
THE METROPOLITAN MANILA
DEVELOPMENT AUTHORITY and BAYANI
FERNANDO vs. VIRON TRANSPORTATION
CO., INC.
G.R. No. 170656 August 15, 2007
FACTS:
GMA declared Executive Order (E.O.) No. 179
operational, thereby creating the MMDA in
2003. Due to traffic congestion, the MMDA
recommended a plan to “decongest traffic by
eliminating the bus terminals now located
along major Metro Manila thoroughfares and
providing more and convenient access to the
mass transport system.” The MMC gave a go
signal for the project. Viron Transit, a bus
company assailed the move. They alleged
that the MMDA didn’t have the power to direct
operators to abandon their terminals. In doing
so they asked the court to interpret the extent
and scope of MMDA’s power under RA 7924.
They also asked if the MMDA law
contravened the Public Service Act.
Another bus operator, Mencorp, prayed for a
TRO for the implementation in a trial court. In
the Pre-Trial Order17 issued by the trial court,
the issues were narrowed down to whether 1)
the MMDA’s power to regulate traffic in Metro
Manila included the power to direct provincial
bus operators to abandon and close their duly
established and existing bus terminals in order
to conduct business in a common terminal; (2)
the E.O. is consistent with the Public Service
Act and the Constitution; and (3) provincial
bus operators would be deprived of their real
properties without due process of law should
they be required to use the common bus
terminals. The trial court sustained the
constitutionality.
Both bus lines filed for a MFR in the trial court.
It, on September 8, 2005, reversed its
Decision, this time holding that the E.O. was
"an unreasonable exercise of police power";
that the authority of the MMDA under Section
(5)(e) of R.A. No. 7924 does not include the
power to order the closure of Viron’s and
Mencorp’s existing bus terminals; and that the
E.O. is inconsistent with the provisions of the
Public Service Act.
MMDA filed a petition in the Supreme Court.
Petitioners contend that there is no justiciable
controversy in the cases for declaratory relief
as nothing in the body of the E.O. mentions or
orders the closure and elimination of bus
terminals along the major thoroughfares of
Metro Manila. To them, Viron and Mencorp
failed to produce any letter or communication
from the Executive Department apprising
them of an immediate plan to close down their
bus terminals.
And petitioners maintain that the E.O. is only
an administrative directive to government
agencies to coordinate with the MMDA and to
make available for use government property
along EDSA and South Expressway corridors.
They add that the only relation created by the
E.O. is that between the Chief Executive and
the implementing officials, but not between
third persons.
ISSUES:
1. Is there a justiciable controversy?
2. Is the elimination of bus terminals
unconstitutional?
HELD:
1. Yes. The Court reiterated the requisites that
constitutes a justiceable controversy, that:
(a) there must be a justiciable
controversy; (b) the controversy must be
between persons whose interests are
adverse; (c) the party seeking
declaratory relief must have a legal
interest in the controversy; and (d) the
issue invoked must be ripe for judicial
determination
It cannot be gainsaid that the E.O. would have
an adverse effect on respondents. The
closure of their bus terminals would mean,
among other things, the loss of income from
the operation and/or rentals of stalls thereat.
Precisely, respondents claim a deprivation of
their constitutional right to property without
due process of law.
Respondents have thus amply demonstrated
a "personal and substantial interest in the
case such that [they have] sustained, or will
sustain, direct injury as a result of [the E.O.’s]
enforcement." Consequently, the established
rule that the constitutionality of a law or
administrative issuance can be challenged by
one who will sustain a direct injury as a result
of its enforcement has been satisfied by
respondents.
2. Yes. Under E.O. 125 A, the DOTC was
given the objective of guiding government and
private investment in the development of the
country’s intermodal transportation and
communications systems. It was also tasked
to administer all laws, rules and regulations in
the field of transportation and
communications.
It bears stressing that under the provisions of
E.O. No. 125, as amended, it is the DOTC,
and not the MMDA, which is authorized to
establish and implement a project such as the
one subject of the cases at bar. Thus, the
President, although authorized to establish or
cause the implementation of the Project, must
exercise the authority through the
instrumentality of the DOTC which, by law, is
the primary implementing and administrative
entity in the promotion, development and
regulation of networks of transportation, and
the one so authorized to establish and
implement a project such as the Project in
question.
By designating the MMDA as the
implementing agency of the Project, the
President clearly overstepped the limits of the
authority conferred by law, rendering E.O. No.
179 ultra vires. There was no grant of
authority to MMDA. It was delegated only to
set the policies concerning traffic in Metro
Manila, and shall coordinate and regulate the
implementation of all programs and projects
concerning traffic management, specifically
pertaining to enforcement, engineering and
education.
In light of the administrative nature of its
powers and functions, the MMDA is devoid of
authority to implement the Project as
envisioned by the E.O; hence, it could not
have been validly designated by the President
to undertake the Project.
MMDA’s move didn’t satisfy police power
requirements such as that (1) the interest of
the public generally, as distinguished from that
of a particular class, requires its exercise; and
(2) the means employed are reasonably
necessary for the accomplishment of the
purpose and not unduly oppressive upon
individuals. Stated differently, the police power
legislation must be firmly grounded on public
interest and welfare and a reasonable relation
must exist between the purposes and the
means.
As early as Calalang v. Williams, this Court
recognized that traffic congestion is a public,
not merely a private, concern. The Court
therein held that public welfare underlies the
contested statute authorizing the Director of
Public Works to promulgate rules and
regulations to regulate and control traffic on
national roads.
Likewise, in Luque v. Villegas,46 this Court
emphasized that public welfare lies at the
bottom of any regulatory measure designed
"to relieve congestion of traffic, which is, to
say the least, a menace to public safety." As
such, measures calculated to promote the
safety and convenience of the people using
the thoroughfares by the regulation of
vehicular traffic present a proper subject for
the exercise of police power.
Notably, the parties herein concede that traffic
congestion is a public concern that needs to
be addressed immediately. Are the means
employed appropriate and reasonably
necessary for the accomplishment of the
purpose. Are they not duly oppressive?
De la Cruz v. Paras- Bus terminals per se do
not, however, impede or help impede the flow
of traffic. How the outright proscription against
the existence of all terminals, apart from that
franchised to petitioner, can be considered as
reasonably necessary to solve the traffic
problem, this Court has not been enlightened
In the subject ordinances, however, the scope
of the proscription against the maintenance of
terminals is so broad that even entities which
might be able to provide facilities better than
the franchised terminal are barred from
operating at all.
Finally, an order for the closure of
respondents’ terminals is not in line with the
provisions of the Public Service Act.

Consonant with such grant of authority, the

PSC (now the ltfrb)was empowered to
"impose such conditions as to construction,
equipment, maintenance, service, or operation
as the public interests and convenience may
reasonably require" in approving any franchise
or privilege. The law mandates the ltfrb to
require any public service to establish,
construct, maintain, and operate any
reasonable extension of its existing facilities.