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[G.R. No. 135962.

March 27, 2000]


METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner, vs. BEL-AIR VILLAGE ASSOCIATION, INC., respondent.
DECISION
PUNO, J.:
Not infrequently, the government is tempted to take legal shortcuts to solve urgent problems of the people. But even
when government is armed with the best of intention, we cannot allow it to run roughshod over the rule of law. Again,
we let the hammer fall and fall hard on the illegal attempt of the MMDA to open for public use a private road in a
private subdivision. While we hold that the general welfare should be promoted, we stress that it should not be
achieved at the expense of the rule of law. h Y

Petitioner MMDA is a government agency tasked with the delivery of basic services in Metro Manila. Respondent Bel-Air
Village Association, Inc. (BAVA) is a non-stock, non-profit corporation whose members are homeowners in Bel-Air
Village, a private subdivision in Makati City. Respondent BAVA is the registered owner of Neptune Street, a road inside
Bel-Air Village.

On December 30, 1995, respondent received from petitioner, through its Chairman, a notice dated December 22, 1995
requesting respondent to open Neptune Street to public vehicular traffic starting January 2, 1996. The notice
reads: Court

"SUBJECT: NOTICE of the Opening of Neptune Street to Traffic


"Dear President Lindo,
"Please be informed that pursuant to the mandate of the MMDA law or Republic Act No. 7924 which requires
the Authority to rationalize the use of roads and/or thoroughfares for the safe and convenient movement of
persons, Neptune Street shall be opened to vehicular traffic effective January 2, 1996.
"In view whereof, the undersigned requests you to voluntarily open the points of entry and exit on said street.
"Thank you for your cooperation and whatever assistance that may be extended by your association to the
MMDA personnel who will be directing traffic in the area.
"Finally, we are furnishing you with a copy of the handwritten instruction of the President on the matter.
"Very truly yours,
PROSPERO I. ORETA
Chairman"[1]
On the same day, respondent was apprised that the perimeter wall separating the subdivision from the adjacent
Kalayaan Avenue would be demolished. Sppedsc

On January 2, 1996, respondent instituted against petitioner before the Regional Trial Court, Branch 136, Makati City,
Civil Case No. 96-001 for injunction. Respondent prayed for the issuance of a temporary restraining order and
preliminary injunction enjoining the opening of Neptune Street and prohibiting the demolition of the perimeter wall.
The trial court issued a temporary restraining order the following day.

On January 23, 1996, after due hearing, the trial court denied issuance of a preliminary injunction.[2] Respondent
questioned the denial before the Court of Appeals in CA-G.R. SP No. 39549. The appellate court conducted an ocular
inspection of Neptune Street[3] and on February 13, 1996, it issued a writ of preliminary injunction enjoining the
implementation of the MMDAs proposed action.[4]

On January 28, 1997, the appellate court rendered a Decision on the merits of the case finding that the MMDA has no
authority to order the opening of Neptune Street, a private subdivision road and cause the demolition of its perimeter
walls. It held that the authority is lodged in the City Council of Makati by ordinance. The decision disposed of as
follows: Jurissc
"WHEREFORE, the Petition is GRANTED; the challenged Order dated January 23, 1995, in Civil Case No. 96-001, is
SET ASIDE and the Writ of Preliminary Injunction issued on February 13, 1996 is hereby made permanent.
"For want of sustainable substantiation, the Motion to Cite Roberto L. del Rosario in contempt is denied.[5]
"No pronouncement as to costs.
"SO ORDERED."[6]
The Motion for Reconsideration of the decision was denied on September 28, 1998. Hence, this recourse. Jksm

Petitioner MMDA raises the following questions:


"I
HAS THE METROPOLITAN MANILA DEVELOPMENT AUTHORITY (MMDA) THE MANDATE TO OPEN NEPTUNE
STREET TO PUBLIC TRAFFIC PURSUANT TO ITS REGULATORY AND POLICE POWERS?
II
IS THE PASSAGE OF AN ORDINANCE A CONDITION PRECEDENT BEFORE THE MMDA MAY ORDER THE OPENING
OF SUBDIVISION ROADS TO PUBLIC TRAFFIC?
III
IS RESPONDENT BEL-AIR VILLAGE ASSOCIATION, INC. ESTOPPED FROM DENYING OR ASSAILING THE AUTHORITY
OF THE MMDA TO OPEN THE SUBJECT STREET? Jlexj
V
WAS RESPONDENT DEPRIVED OF DUE PROCESS DESPITE THE SEVERAL MEETINGS HELD BETWEEN MMDA AND
THE AFFECTED BEL-AIR RESIDENTS AND BAVA OFFICERS?
V
HAS RESPONDENT COME TO COURT WITH UNCLEAN HANDS?"[7]
Neptune Street is owned by respondent BAVA. It is a private road inside Bel-Air Village, a private residential subdivision
in the heart of the financial and commercial district of Makati City. It runs parallel to Kalayaan Avenue, a national road
open to the general public. Dividing the two (2) streets is a concrete perimeter wall approximately fifteen (15) feet high.
The western end of Neptune Street intersects Nicanor Garcia, formerly Reposo Street, a subdivision road open to public
vehicular traffic, while its eastern end intersects Makati Avenue, a national road. Both ends of Neptune Street are
guarded by iron gates. Edp mis

Petitioner MMDA claims that it has the authority to open Neptune Street to public traffic because it is an agent of the
state endowed with police power in the delivery of basic services in Metro Manila. One of these basic services is traffic
management which involves the regulation of the use of thoroughfares to insure the safety, convenience and welfare of
the general public. It is alleged that the police power of MMDA was affirmed by this Court in the consolidated cases of
Sangalang v. Intermediate Appellate Court.[8] From the premise that it has police power, it is now urged that there is no
need for the City of Makati to enact an ordinance opening Neptune street to the public.[9]

Police power is an inherent attribute of sovereignty. It has been defined as the power vested by the Constitution in the
legislature to make, ordain, and establish all manner of wholesome and reasonable laws, statutes and ordinances, either
with penalties or without, not repugnant to the Constitution, as they shall judge to be for the good and welfare of the
commonwealth, and for the subjects of the same.[10] The power is plenary and its scope is vast and pervasive, reaching
and justifying measures for public health, public safety, public morals, and the general welfare.[11]

It bears stressing that police power is lodged primarily in the National Legislature.[12] It cannot be exercised by any group
or body of individuals not possessing legislative power.[13] 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.[14] Once delegated, the agents can exercise only such legislative powers as are conferred on them by the national
lawmaking body.[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] The Local Government Code of 1991 defines a local government unit as a "body politic and
corporate"[17]-- one endowed with powers as a political subdivision of the National Government and as a corporate
entity representing the inhabitants of its territory.[18] Local government units are the provinces, cities, municipalities and
barangays.[19] They are also the territorial and political subdivisions of the state.[20]

Our Congress delegated police power to the local government units in the Local Government Code of 1991. This
delegation is found in Section 16 of the same Code, known as the general welfare clause, viz: Chief
"Sec. 16. General Welfare. Every local government unit shall exercise the powers expressly granted, those
necessarily implied therefrom, as well as powers necessary, appropriate, or incidental for its efficient and
effective governance, and those which are essential to the promotion of the general welfare. Within their
respective territorial jurisdictions, local government units shall ensure and support, among other things, the
preservation and enrichment of culture, promote health and safety, enhance the right of the people to a
balanced ecology, encourage and support the development of appropriate and self-reliant scientific and
technological capabilities, improve public morals, enhance economic prosperity and social justice, promote full
employment among their residents, maintain peace and order, and preserve the comfort and convenience of
their inhabitants."[21]

Local government units exercise police power through their respective legislative bodies. The legislative body of the
provincial government is the sangguniang panlalawigan, that of the city government is the sangguniang panlungsod,
that of the municipal government is the sangguniang bayan, and that of the barangay is the sangguniang barangay. The
Local Government Code of 1991 empowers the sangguniang panlalawigan, sangguniang panlungsod and sangguniang
bayan to "enact ordinances, approve resolutions and appropriate funds for the general welfare of the [province, city or
municipality, as the case may be], and its inhabitants pursuant to Section 16 of the Code and in the proper exercise of
the corporate powers of the [province, city municipality] provided under the Code x x x."[22] The same Code gives
the sangguniang barangay the power to "enact ordinances as may be necessary to discharge the responsibilities
conferred upon it by law or ordinance and to promote the general welfare of the inhabitants thereon."[23]

Metropolitan or Metro Manila is a body composed of several local government units - i.e., twelve (12) cities and five
(5) municipalities, namely, the cities of Caloocan, Manila, Mandaluyong, Makati, Pasay, Pasig, Quezon, Muntinlupa, Las
Pinas, Marikina, Paranaque and Valenzuela, and the municipalities of Malabon, , Navotas, , Pateros, San Juan and
Taguig. With the passage of Republic Act (R. A.) No. 7924[24] 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.[25]

"Metro-wide services" are those "services which have metro-wide impact and transcend local political boundaries or
entail huge expenditures such that it would not be viable for said services to be provided by the individual local
government units comprising Metro Manila."[26] There are seven (7) basic metro-wide services and the scope of these
services cover the following: (1) development planning; (2) transport and traffic management; (3) solid waste disposal
and management; (4) flood control and sewerage management; (5) urban renewal, zoning and land use planning, and
shelter services; (6) health and sanitation, urban protection and pollution control; and (7) public safety. The basic service
of transport and traffic management includes the following: Lexjuris

"(b) Transport and traffic management which include the formulation, coordination, and monitoring of
policies, standards, programs and projects to rationalize the existing transport operations, infrastructure
requirements, the use of thoroughfares, and promotion of safe and convenient movement of persons and
goods; provision for the mass transport system and the institution of a system to regulate road users;
administration and implementation of all traffic enforcement operations, traffic engineering services and
traffic education programs, including the institution of a single ticketing system in Metropolitan Manila;"[27]

In the delivery of the seven (7) basic services, the MMDA has the following powers and functions: Esm

"Sec. 5. Functions and powers of the Metro Manila Development Authority.The MMDA shall:

(a) Formulate, coordinate and regulate the implementation of medium and long-term plans and programs for
the delivery of metro-wide services, land use and physical development within Metropolitan Manila, consistent
with national development objectives and priorities;

(b) Prepare, coordinate and regulate the implementation of medium-term investment programs for metro-wide
services which shall indicate sources and uses of funds for priority programs and projects, and which shall
include the packaging of projects and presentation to funding institutions; Esmsc
(c) Undertake and manage on its own metro-wide programs and projects for the delivery of specific services
under its jurisdiction, subject to the approval of the Council. For this purpose, MMDA can create appropriate
project management offices;

(d) Coordinate and monitor the implementation of such plans, programs and projects in Metro Manila; identify
bottlenecks and adopt solutions to problems of implementation;

(e) The MMDA shall 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. Upon request, it shall be extended assistance and cooperation,
including but not limited to, assignment of personnel, by all other government agencies and offices
concerned;

(f) 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
RA 4136 and PD 1605 to the contrary notwithstanding. For this purpose, the Authority shall impose 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; and

(g) Perform other related functions required to achieve the objectives of the MMDA, including the undertaking
of delivery of basic services to the local government units, when deemed necessary subject to prior coordination
with and consent of the local government unit concerned." Jurismis

The implementation of the MMDAs plans, programs and projects is undertaken by the local government units, national
government agencies, accredited peoples organizations, non-governmental organizations, and the private sector as well
as by the MMDA itself. For this purpose, the MMDA has the power to enter into contracts, memoranda of agreement
and other cooperative arrangements with these bodies for the delivery of the required services within Metro Manila.[28]

The governing board of the MMDA is the Metro Manila Council. The Council is composed of the mayors of the
component 12 cities and 5 municipalities, the president of the Metro Manila Vice-Mayors League and the president of
the Metro Manila Councilors League.[29] The Council is headed by a Chairman who is appointed by the President and
vested with the rank of cabinet member. As the policy-making body of the MMDA, the Metro Manila Council approves
metro-wide plans, programs and projects, and issues the necessary rules and regulations for the implementation of said
plans; it approves the annual budget of the MMDA and promulgates the rules and regulations for the delivery of basic
services, collection of service and regulatory fees, fines and penalties. These functions are particularly enumerated as
follows: LEX

"Sec. 6. Functions of the Metro Manila Council. -


(a) The Council shall be the policy-making body of the MMDA;
(b) It shall approve metro-wide plans, programs and projects and issue rules and regulations deemed necessary
by the MMDA to carry out the purposes of this Act;
(c) It may increase the rate of allowances and per diems of the members of the Council to be effective during
the term of the succeeding Council. It shall fix the compensation of the officers and personnel of the MMDA,
and approve the annual budget thereof for submission to the Department of Budget and Management (DBM);
(d) It shall promulgate rules and regulations and set policies and standards for metro-wide application governing
the delivery of basic services, prescribe and collect service and regulatory fees, and impose and collect fines and
penalties." Jj sc

Clearly, the scope of the MMDAs function is limited to the delivery of the seven (7) basic services. One of these is
transport and traffic management which includes the formulation and monitoring of policies, standards and projects to
rationalize the existing transport operations, infrastructure requirements, the use of thoroughfares and promotion of
the safe movement of persons and goods. It also covers the mass transport system and the institution of a system of
road regulation, the administration of all traffic enforcement operations, traffic engineering services and traffic
education programs, including the institution of a single ticketing system in Metro Manila for traffic violations. Under
this service, the MMDA is expressly authorized "to set the policies concerning traffic" and "coordinate and regulate the
implementation of all traffic management programs." In addition, the MMDA may "install and administer a single
ticketing system," fix, impose and collect fines and penalties for all traffic violations. Ca-lrsc

It will be noted that the powers of the MMDA are limited to the following acts: formulation, coordination, regulation,
implementation, preparation, management, monitoring, setting of policies, installation of a system and
administration. There is no syllable in R. A. No. 7924 that grants the MMDA police power, let alone legislative power.
Even the Metro Manila Council has not been delegated any legislative power. Unlike the legislative bodies of the local
government units, there is no provision in R. A. No. 7924 that empowers the MMDA or its Council to "enact ordinances,
approve resolutions and appropriate funds for the general welfare" of the inhabitants of Metro Manila. The MMDA is, as
termed in the charter itself, a "development authority."[30] It is an agency created for the purpose of laying down policies
and coordinating with the various national government agencies, peoples 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, viz:

"Sec. 2. Creation of the Metropolitan Manila Development Authority. -- x x x.


The MMDA shall perform planning, monitoring and coordinative functions, and in the process
exercise regulatory and supervisory authority over the delivery of metro-wide services within Metro Manila,
without diminution of the autonomy of the local government units concerning purely local matters."[31]
Petitioner cannot seek refuge in the cases of Sangalang v. Intermediate Appellate Court[32] where we upheld a zoning
ordinance issued by the Metro Manila Commission (MMC), the predecessor of the MMDA, as an exercise of police
power. The first Sangalang decision was on the merits of the petition,[33] while the second decision denied
reconsideration of the first case and in addition discussed the case of Yabut v. Court of Appeals.[34]

Sangalang v. IAC involved five (5) consolidated petitions filed by respondent BAVA and three residents of Bel-Air Village
against other residents of the Village and the Ayala Corporation, formerly the Makati Development Corporation, as the
developer of the subdivision. The petitioners sought to enforce certain restrictive easements in the deeds of sale over
their respective lots in the subdivision. These were the prohibition on the setting up of commercial and advertising signs
on the lots, and the condition that the lots be used only for residential purposes. Petitioners alleged that respondents,
who were residents along Jupiter Street of the subdivision, converted their residences into commercial establishments
in violation of the "deed restrictions," and that respondent Ayala Corporation ushered in the full commercialization" of
Jupiter Street by tearing down the perimeter wall that separated the commercial from the residential section of the
village.[35]

The petitions were dismissed based on Ordinance No. 81 of the Municipal Council of Makati and Ordinance No. 81-01 of
the Metro Manila Commission (MMC). Municipal Ordinance No. 81 classified Bel-Air Village as a Class A Residential
Zone, with its boundary in the south extending to the center line of Jupiter Street. The Municipal Ordinance was
adopted by the MMC under the Comprehensive Zoning Ordinance for the National Capital Region and promulgated as
MMC Ordinance No. 81-01. Bel-Air Village was indicated therein as bounded by Jupiter Street and the block adjacent
thereto was classified as a High Intensity Commercial Zone.[36]

We ruled that since both Ordinances recognized Jupiter Street as the boundary between Bel-Air Village and the
commercial district, Jupiter Street was not for the exclusive benefit of Bel-Air residents. We also held that the perimeter
wall on said street was constructed not to separate the residential from the commercial blocks but simply for security
reasons, hence, in tearing down said wall, Ayala Corporation did not violate the "deed restrictions" in the deeds of
sale. Scc-alr
We upheld the ordinances, specifically MMC Ordinance No. 81-01, as a legitimate exercise of police power.[37] The power
of the MMC and the Makati Municipal Council to enact zoning ordinances for the general welfare prevailed over the
"deed restrictions".

In the second Sangalang/Yabut decision, we held that the opening of Jupiter Street was warranted by the demands of
the common good in terms of "traffic decongestion and public convenience." Jupiter was opened by the Municipal
Mayor to alleviate traffic congestion along the public streets adjacent to the Village.[38] The same reason was given for
the opening to public vehicular traffic of Orbit Street, a road inside the same village. The destruction of the gate in Orbit
Street was also made under the police power of the municipal government. The gate, like the perimeter wall along
Jupiter, was a public nuisance because it hindered and impaired the use of property, hence, its summary abatement by
the mayor was proper and legal.[39]

Contrary to petitioners claim, the two Sangalang cases do not apply to the case at bar. Firstly, both involved zoning
ordinances passed by the municipal council of Makati and the MMC. In the instant case, the basis for the proposed
opening of Neptune Street is contained in the notice of December 22, 1995 sent by petitioner to respondent BAVA,
through its president. The notice does not cite any ordinance or law, either by the Sangguniang Panlungsod of Makati
City or by the MMDA, as the legal basis for the proposed opening of Neptune Street. Petitioner MMDA simply relied on
its authority under its charter "to rationalize the use of roads and/or thoroughfares for the safe and convenient
movement of persons." Rationalizing the use of roads and thoroughfares is one of the acts that fall within the scope of
transport and traffic management. By no stretch of the imagination, however, can this be interpreted as an express or
implied grant of ordinance-making power, much less police power. Misjuris

Secondly, the MMDA is not the same entity as the MMC in Sangalang. Although the MMC is the forerunner of the
present MMDA, an examination of Presidential Decree (P. D.) No. 824, the charter of the MMC, shows that the latter
possessed greater powers which were not bestowed on the present MMDA. Jjlex

Metropolitan Manila was first created in 1975 by Presidential Decree (P.D.) No. 824. It comprised the Greater Manila
Area composed of the contiguous four (4) cities of Manila, Quezon, Pasay and Caloocan, and the thirteen (13)
municipalities of Makati, Mandaluyong, San Juan, Las Pinas, Malabon, Navotas, Pasig, Pateros, Paranaque, Marikina,
Muntinlupa and Taguig in the province of Rizal, and Valenzuela in the province of Bulacan.[40] Metropolitan Manila was
created as a response to the finding that the rapid growth of population and the increase of social and economic
requirements in these areas demand a call for simultaneous and unified development; that the public services rendered
by the respective local governments could be administered more efficiently and economically if integrated under a
system of central planning; and this coordination, "especially in the maintenance of peace and order and the eradication
of social and economic ills that fanned the flames of rebellion and discontent [were] part of reform measures under
Martial Law essential to the safety and security of the State."[41]

Metropolitan Manila was established as a "public corporation" with the following powers: Calrs-pped

"Section 1. Creation of the Metropolitan Manila.There is hereby created a public corporation, to be known as
the Metropolitan Manila, vested with powers and attributes of a corporation including the power to make
contracts, sue and be sued, acquire, purchase, expropriate, hold, transfer and dispose of property and such
other powers as are necessary to carry out its purposes. The Corporation shall be administered by a
Commission created under this Decree."[42]
The administration of Metropolitan Manila was placed under the Metro Manila Commission (MMC) vested with the
following powers:

"Sec. 4. Powers and Functions of the Commission. - The Commission shall have the following powers and
functions:
1. To act as a central government to establish and administer programs and provide services common to the
area;
2. To levy and collect taxes and special assessments, borrow and expend money and issue bonds, revenue
certificates, and other obligations of indebtedness. Existing tax measures should, however, continue to be
operative until otherwise modified or repealed by the Commission;
3. To charge and collect fees for the use of public service facilities;
4. To appropriate money for the operation of the metropolitan government and review appropriations for the
city and municipal units within its jurisdiction with authority to disapprove the same if found to be not in
accordance with the established policies of the Commission, without prejudice to any contractual obligation of
the local government units involved existing at the time of approval of this Decree;
5. To review, amend, revise or repeal all ordinances, resolutions and acts of cities and municipalities within
Metropolitan Manila;
6. To enact or approve ordinances, resolutions and to fix penalties for any violation thereof which shall not
exceed a fine of P10,000.00 or imprisonment of six years or both such fine and imprisonment for a single
offense;
7. To perform general administrative, executive and policy-making functions;
8. To establish a fire control operation center, which shall direct the fire services of the city and municipal
governments in the metropolitan area;
9. To establish a garbage disposal operation center, which shall direct garbage collection and disposal in the
metropolitan area;
10. To establish and operate a transport and traffic center, which shall direct traffic activities; Jjjuris
11. To coordinate and monitor governmental and private activities pertaining to essential services such as
transportation, flood control and drainage, water supply and sewerage, social, health and environmental
services, housing, park development, and others;
12. To insure and monitor the undertaking of a comprehensive social, economic and physical planning and
development of the area;
13. To study the feasibility of increasing barangay participation in the affairs of their respective local
governments and to propose to the President of the Philippines definite programs and policies for
implementation;
14. To submit within thirty (30) days after the close of each fiscal year an annual report to the President of the
Philippines and to submit a periodic report whenever deemed necessary; and
15. To perform such other tasks as may be assigned or directed by the President of the Philippines." Sc jj

The MMC was the "central government" of Metro Manila for the purpose of establishing and administering programs
providing services common to the area. As a "central government" it had the power to levy and collect taxes and special
assessments, the power to charge and collect fees; the power to appropriate money for its operation, and at the same
time, review appropriations for the city and municipal units within its jurisdiction. It was bestowed the power to enact or
approve ordinances, resolutions and fix penalties for violation of such ordinances and resolutions. It also had the power
to review, amend, revise or repeal all ordinances, resolutions and acts of any of the four (4) cities and thirteen (13)
municipalities comprising Metro Manila.

P. D. No. 824 further provided:


"Sec. 9. Until otherwise provided, the governments of the four cities and thirteen municipalities in the
Metropolitan Manila shall continue to exist in their present form except as may be inconsistent with this
Decree. The members of the existing city and municipal councils in Metropolitan Manila shall, upon
promulgation of this Decree, and until December 31, 1975, become members of the Sangguniang Bayan which
is hereby created for every city and municipality of Metropolitan Manila.
In addition, the Sangguniang Bayan shall be composed of as many barangay captains as may be determined and
chosen by the Commission, and such number of representatives from other sectors of the society as may be
appointed by the President upon recommendation of the Commission.
x x x.
The Sangguniang Bayan may recommend to the Commission ordinances, resolutions or such measures as it
may adopt; Provided, that no such ordinance, resolution or measure shall become effective, until after its
approval by the Commission; and Provided further, that the power to impose taxes and other levies, the
power to appropriate money and the power to pass ordinances or resolutions with penal sanctions shall be
vested exclusively in the Commission."
The creation of the MMC also carried with it the creation of the Sangguniang Bayan. This was composed of the
members of the component city and municipal councils, barangay captains chosen by the MMC and sectoral
representatives appointed by the President. The Sangguniang Bayan had the power to recommend to the MMC the
adoption of ordinances, resolutions or measures. It was the MMC itself, however, that possessed legislative powers. All
ordinances, resolutions and measures recommended by the Sangguniang Bayan were subject to the MMCs approval.
Moreover, the power to impose taxes and other levies, the power to appropriate money, and the power to pass
ordinances or resolutions with penal sanctions were vested exclusively in the MMC. Sce-dp

Thus, Metropolitan Manila had a "central government," i.e., the MMC which fully possessed legislative and police
powers. Whatever legislative powers the component cities and municipalities had were all subject to review and
approval by the MMC.

After President Corazon Aquino assumed power, there was a clamor to restore the autonomy of the local government
units in Metro Manila. Hence, Sections 1 and 2 of Article X of the 1987 Constitution provided: Sj cj

"Section 1. The territorial and political subdivisions of the Republic of the Philippines are the provinces, cities,
municipalities and barangays. There shall be autonomous regions in Muslim Mindanao and the Cordilleras as
herein provided.

Section 2. The territorial and political subdivisions shall enjoy local autonomy."

The Constitution, however, recognized the necessity of creating metropolitan regions not only in the existing National
Capital Region but also in potential equivalents in the Visayas and Mindanao.[43] Section 11 of the same Article X thus
provided:

"Section 11. The Congress may, by law, create special metropolitan political subdivisions, subject to a plebiscite
as set forth in Section 10 hereof. The component cities and municipalities shall retain their basic autonomy and
shall be entitled to their own local executives and legislative assemblies. The jurisdiction of the metropolitan
authority that will thereby be created shall be limited to basic services requiring coordination."

The Constitution itself expressly provides that Congress may, by law, create "special metropolitan political subdivisions"
which shall be subject to approval by a majority of the votes cast in a plebiscite in the political units directly affected; the
jurisdiction of this subdivision shall be limited to basic services requiring coordination; and the cities and municipalities
comprising this subdivision shall retain their basic autonomy and their own local executive and legislative
assemblies.[44] Pending enactment of this law, the Transitory Provisions of the Constitution gave the President of the
Philippines the power to constitute the Metropolitan Authority, viz:

"Section 8. Until otherwise provided by Congress, the President may constitute the Metropolitan Authority to be
composed of the heads of all local government units comprising the Metropolitan Manila area."[45]

In 1990, President Aquino issued Executive Order (E. O.) No. 392 and constituted the Metropolitan Manila Authority
(MMA). The powers and functions of the MMC were devolved to the MMA.[46] It ought to be stressed, however, that
not all powers and functions of the MMC were passed to the MMA. The MMAs power was limited to the "delivery of
basic urban services requiring coordination in Metropolitan Manila."[47] The MMAs governing body, the Metropolitan
Manila Council, although composed of the mayors of the component cities and municipalities, was merely given the
power of: (1) formulation of policies on the delivery of basic services requiring coordination and consolidation; and (2)
promulgation of resolutions and other issuances, approval of a code of basic services and the exercise of its rule-
making power.[48]

Under the 1987 Constitution, the local government units became primarily responsible for the governance of their
respective political subdivisions. The MMAs jurisdiction was limited to addressing common problems involving basic
services that transcended local boundaries. It did not have legislative power. Its power was merely to provide the local
government units technical assistance in the preparation of local development plans. Any semblance of legislative power
it had was confined to a "review [of] legislation proposed by the local legislative assemblies to ensure consistency
among local governments and with the comprehensive development plan of Metro Manila," and to "advise the local
governments accordingly."[49]

When R.A. No. 7924 took effect, Metropolitan Manila became a "special development and administrative region" and
the MMDA a "special development authority" whose functions were "without prejudice to the autonomy of the
affected local government units." The character of the MMDA was clearly defined in the legislative debates enacting
its charter.

R. A. No. 7924 originated as House Bill No. 14170/ 11116 and was introduced by several legislators led by Dante Tinga,
Roilo Golez and Feliciano Belmonte. It was presented to the House of Representatives by the Committee on Local
Governments chaired by Congressman Ciriaco R. Alfelor. The bill was a product of Committee consultations with the
local government units in the National Capital Region (NCR), with former Chairmen of the MMC and MMA,[50] and career
officials of said agencies. When the bill was first taken up by the Committee on Local Governments, the following debate
took place:

"THE CHAIRMAN [Hon. Ciriaco Alfelor]: Okay, Let me explain. This has been debated a long time ago, you know.
Its a special we can create a special metropolitan political subdivision. Supreme

Actually, there are only six (6) political subdivisions provided for in the Constitution: barangay, municipality, city,
province, and we have the Autonomous Region of Mindanao and we have the Cordillera. So we have 6. Now.

HON. [Elias] LOPEZ: May I interrupt, Mr. Chairman. In the case of the Autonomous Region, that is also
specifically mandated by the Constitution.

THE CHAIRMAN: Thats correct. But it is considered to be a political subdivision. What is the meaning of a
political subdivision? Meaning to say, that it has its own government, it has its own political personality, it has
the power to tax, and all governmental powers: police power and everything. All right. Authority is different;
because it does not have its own government. It is only a council, it is an organization of political subdivision,
powers, no, which is not imbued with any political power. Esmmis

If you go over Section 6, where the powers and functions of the Metro Manila Development Authority, it is
purely coordinative. And it provides here that the council is policy-making. All right.

Under the Constitution is a Metropolitan Authority with coordinative power. Meaning to say, it coordinates all
of the different basic services which have to be delivered to the constituency. All right.

There is now a problem. Each local government unit is given its respective as a political subdivision. Kalookan has its
powers, as provided for and protected and guaranteed by the Constitution. All right, the exercise. However, in the
exercise of that power, it might be deleterious and disadvantageous to other local government units. So, we are forming
an authority where all of these will be members and then set up a policy in order that the basic services can be
effectively coordinated. All right. justice

Of course, we cannot deny that the MMDA has to survive. We have to provide some funds, resources. But it
does not possess any political power. We do not elect the Governor. We do not have the power to tax. As a
matter of fact, I was trying to intimate to the author that it must have the power to sue and be sued because it
coordinates. All right. It coordinates practically all these basic services so that the flow and the distribution of
the basic services will be continuous. Like traffic, we cannot deny that. Its before our eyes. Sewerage, flood
control, water system, peace and order, we cannot deny these. Its right on our face. We have to look for a
solution. What would be the right solution? All right, we envision that there should be a coordinating agency
and it is called an authority. All right, if you do not want to call it an authority, its alright. We may call it a council
or maybe a management agency.
x x x."[51]

Clearly, the MMDA is not a political unit of government. The power delegated to the MMDA is that given to the Metro
Manila Council to promulgate administrative rules and regulations in the implementation of the MMDAs
functions. There is no grant of authority to enact ordinances and regulations for the general welfare of the inhabitants
of the metropolis. This was explicitly stated in the last Committee deliberations prior to the bills presentation to
Congress. Thus: Ed-p

"THE CHAIRMAN: Yeah, but we have to go over the suggested revision. I think this was already approved before,
but it was reconsidered in view of the proposals, set-up, to make the MMDA stronger. Okay, so if there is no
objection to paragraph "f" And then next is paragraph "b," under Section 6. "It shall approve metro-wide plans,
programs and projects and issue ordinances or resolutions deemed necessary by the MMDA to carry out the
purposes of this Act." Do you have the powers? Does the MMDA because that takes the form of a local
government unit, a political subdivision.
HON. [Feliciano] BELMONTE: Yes, I believe so, your Honor. When we say that it has the policies, its very clear
that those policies must be followed. Otherwise, whats the use of empowering it to come out with policies.
Now, the policies may be in the form of a resolution or it may be in the form of a ordinance. The term
"ordinance" in this case really gives it more teeth, your honor. Otherwise, we are going to see a situation where
you have the power to adopt the policy but you cannot really make it stick as in the case now, and I think here is
Chairman Bunye. I think he will agree that that is the case now. Youve got the power to set a policy, the body
wants to follow your policy, then we say lets call it an ordinance and see if they will not follow it.
THE CHAIRMAN: Thats very nice. I like that. However, there is a constitutional impediment. You are making
this MMDA a political subdivision. The creation of the MMDA would be subject to a plebiscite. That is what Im
trying to avoid. Ive been trying to avoid this kind of predicament. Under the Constitution it states: if it is a
political subdivision, once it is created it has to be subject to a plebiscite. Im trying to make this as
administrative. Thats why we place the Chairman as a cabinet rank.
HON. BELMONTE: All right, Mr. Chairman, okay, what you are saying there is .
THE CHAIRMAN: In setting up ordinances, it is a political exercise. Believe me.
HON. [Elias] LOPEZ: Mr. Chairman, it can be changed into issuances of rules and regulations. That would be it
shall also be enforced. Jksm
HON. BELMONTE: Okay, I will .
HON. LOPEZ: And you can also say that violation of such rule, you impose a sanction. But you know, ordinance
has a different legal connotation.
HON. BELMONTE: All right. I defer to that opinion, your Honor. sc
THE CHAIRMAN: So instead of ordinances, say rules and regulations.
HON. BELMONTE: Or resolutions. Actually, they are actually considering resolutions now.
THE CHAIRMAN: Rules and resolutions.
HON. BELMONTE: Rules, regulations and resolutions."[52]

The draft of H. B. No. 14170/ 11116 was presented by the Committee to the House of Representatives. The explanatory
note to the bill stated that the proposed MMDA is a "development authority" which is a "national agency, not a political
government unit."[53] The explanatory note was adopted as the sponsorship speech of the Committee on Local
Governments. No interpellations or debates were made on the floor and no amendments introduced. The bill was
approved on second reading on the same day it was presented.[54]

When the bill was forwarded to the Senate, several amendments were made. These amendments, however, did not
affect the nature of the MMDA as originally conceived in the House of Representatives.[55]

It is thus beyond doubt that the MMDA is not a local government unit or a public corporation endowed with
legislative power. It is not even a "special metropolitan political subdivision" as contemplated in Section 11, Article X of
the Constitution. The creation of a "special metropolitan political subdivision" requires the approval by a majority of the
votes cast in a plebiscite in the political units directly affected.[56] R. A. No. 7924 was not submitted to the inhabitants of
Metro Manila in a plebiscite. The Chairman of the MMDA is not an official elected by the people, but appointed by the
President with the rank and privileges of a cabinet member. In fact, part of his function is to perform such other duties
as may be assigned to him by the President,[57]whereas in local government units, the President merely exercises
supervisory authority. This emphasizes the administrative character of the MMDA. Newmiso

Clearly then, the MMC under P. D. No. 824 is not the same entity as the MMDA under R. A. No. 7924. Unlike the
MMC, the MMDA has no power to enact ordinances for the welfare of the community. It is the local government units,
acting through their respective legislative councils, that possess legislative power and police power. In the case at bar,
the Sangguniang Panlungsod of Makati City did not pass any ordinance or resolution ordering the opening of Neptune
Street, hence, its proposed opening by petitioner MMDA is illegal and the respondent Court of Appeals did not err in so
ruling. We desist from ruling on the other issues as they are unnecessary. Esmso

We stress that this decision does not make light of the MMDAs noble efforts to solve the chaotic traffic condition in
Metro Manila. Everyday, traffic jams and traffic bottlenecks plague the metropolis. Even our once sprawling boulevards
and avenues are now crammed with cars while city streets are clogged with motorists and pedestrians. Traffic has
become a social malaise affecting our peoples productivity and the efficient delivery of goods and services in the
country. The MMDA was created to put some order in the metropolitan transportation system but unfortunately the
powers granted by its charter are limited. Its good intentions cannot justify the opening for public use of a private street
in a private subdivision without any legal warrant. The promotion of the general welfare is not antithetical to the
preservation of the rule of law. Sdjad

IN VIEW WHEREOF, the petition is denied. The Decision and Resolution of the Court of Appeals in CA-G.R. SP No. 39549
are affirmed. Sppedsc

SO ORDERED.
G.R. No. 111097 July 20, 1994
MAYOR PABLO P. MAGTAJAS & THE CITY OF CAGAYAN DE ORO, petitioners,
vs.
PRYCE PROPERTIES CORPORATION, INC. & PHILIPPINE AMUSEMENT AND GAMING CORPORATION, respondents.
Aquilino G. Pimentel, Jr. and Associates for petitioners.
R.R. Torralba & Associates for private respondent.

CRUZ, J.:

There was instant opposition when PAGCOR announced the opening of a casino in Cagayan de Oro City. Civic
organizations angrily denounced the project. The religious elements echoed the objection and so did the women's
groups and the youth. Demonstrations were led by the mayor and the city legislators. The media trumpeted the protest,
describing the casino as an affront to the welfare of the city.
The trouble arose when in 1992, flush with its tremendous success in several cities, PAGCOR decided to expand its
operations to Cagayan de Oro City. To this end, it leased a portion of a building belonging to Pryce Properties
Corporation, Inc., one of the herein private respondents, renovated and equipped the same, and prepared to inaugurate
its casino there during the Christmas season.

The reaction of the Sangguniang Panlungsod of Cagayan de Oro City was swift and hostile. On December 7, 1992, it
enacted Ordinance No. 3353 reading as follows:

ORDINANCE NO. 3353

AN ORDINANCE PROHIBITING THE ISSUANCE OF BUSINESS PERMIT AND CANCELLING EXISTING BUSINESS
PERMIT TO ANY ESTABLISHMENT FOR THE USING AND ALLOWING TO BE USED ITS PREMISES OR PORTION
THEREOF FOR THE OPERATION OF CASINO.
BE IT ORDAINED by the Sangguniang Panlungsod of the City of Cagayan de Oro, in session assembled that:
Sec. 1. — That pursuant to the policy of the city banning the operation of casino within its territorial jurisdiction,
no business permit shall be issued to any person, partnership or corporation for the operation of casino within
the city limits.
Sec. 2. — That it shall be a violation of existing business permit by any persons, partnership or corporation to
use its business establishment or portion thereof, or allow the use thereof by others for casino operation and
other gambling activities.
Sec. 3. — PENALTIES. — Any violation of such existing business permit as defined in the preceding section shall
suffer the following penalties, to wit:
a) Suspension of the business permit for sixty (60) days for the first offense and a fine of P1,000.00/day
b) Suspension of the business permit for Six (6) months for the second offense, and a fine of
P3,000.00/day
c) Permanent revocation of the business permit and imprisonment of One (1) year, for the third and
subsequent offenses.
Sec. 4. — This Ordinance shall take effect ten (10) days from publication thereof.

Nor was this all. On January 4, 1993, it adopted a sterner Ordinance No. 3375-93 reading as follows:

ORDINANCE NO. 3375-93


AN ORDINANCE PROHIBITING THE OPERATION OF CASINO AND PROVIDING PENALTY FOR VIOLATION
THEREFOR.
WHEREAS, the City Council established a policy as early as 1990 against CASINO under its Resolution No. 2295;
WHEREAS, on October 14, 1992, the City Council passed another Resolution No. 2673, reiterating its policy
against the establishment of CASINO;
WHEREAS, subsequently, thereafter, it likewise passed Ordinance No. 3353, prohibiting the issuance of Business
Permit and to cancel existing Business Permit to any establishment for the using and allowing to be used its
premises or portion thereof for the operation of CASINO;
WHEREAS, under Art. 3, section 458, No. (4), sub paragraph VI of the Local Government Code of 1991 (Rep. Act
7160) and under Art. 99, No. (4), Paragraph VI of the implementing rules of the Local Government Code, the City
Council as the Legislative Body shall enact measure to suppress any activity inimical to public morals and general
welfare of the people and/or regulate or prohibit such activity pertaining to amusement or entertainment in
order to protect social and moral welfare of the community;
NOW THEREFORE,
BE IT ORDAINED by the City Council in session duly assembled that:
Sec. 1. — The operation of gambling CASINO in the City of Cagayan de Oro is hereby prohibited.
Sec. 2. — Any violation of this Ordinance shall be subject to the following penalties:
a) Administrative fine of P5,000.00 shall be imposed against the proprietor, partnership or corporation
undertaking the operation, conduct, maintenance of gambling CASINO in the City and closure thereof;
b) Imprisonment of not less than six (6) months nor more than one (1) year or a fine in the amount of P5,000.00
or both at the discretion of the court against the manager, supervisor, and/or any person responsible in the
establishment, conduct and maintenance of gambling CASINO.
Sec. 3. — This Ordinance shall take effect ten (10) days after its publication in a local newspaper of general
circulation.

Pryce assailed the ordinances before the Court of Appeals, where it was joined by PAGCOR as intervenor and
supplemental petitioner. Their challenge succeeded. On March 31, 1993, the Court of Appeals declared the ordinances
invalid and issued the writ prayed for to prohibit their enforcement. 1 Reconsideration of this decision was denied on
July 13, 1993. 2

Cagayan de Oro City and its mayor are now before us in this petition for review under Rule 45 of the Rules of
Court. 3 They aver that the respondent Court of Appeals erred in holding that:

1. Under existing laws, the Sangguniang Panlungsod of the City of Cagayan de Oro does not have the power and
authority to prohibit the establishment and operation of a PAGCOR gambling casino within the City's territorial
limits.
2. The phrase "gambling and other prohibited games of chance" found in Sec. 458, par. (a), sub-par. (1) — (v) of
R.A. 7160 could only mean "illegal gambling."
3. The questioned Ordinances in effect annul P.D. 1869 and are therefore invalid on that point.
4. The questioned Ordinances are discriminatory to casino and partial to cockfighting and are therefore invalid
on that point.
5. The questioned Ordinances are not reasonable, not consonant with the general powers and purposes of the
instrumentality concerned and inconsistent with the laws or policy of the State.
6. It had no option but to follow the ruling in the case of Basco, et al. v. PAGCOR, G.R. No. 91649, May 14, 1991,
197 SCRA 53 in disposing of the issues presented in this present case.

PAGCOR is a corporation created directly by P.D. 1869 to help centralize and regulate all games of chance, including
casinos on land and sea within the territorial jurisdiction of the Philippines. In Basco v. Philippine Amusements and
Gaming Corporation, 4 this Court sustained the constitutionality of the decree and even cited the benefits of the entity
to the national economy as the third highest revenue-earner in the government, next only to the BIR and the Bureau of
Customs.

Cagayan de Oro City, like other local political subdivisions, is empowered to enact ordinances for the purposes indicated
in the Local Government Code. It is expressly vested with the police power under what is known as the General Welfare
Clause now embodied in Section 16 as follows:

Sec. 16. — General Welfare. — Every local government unit shall exercise the powers expressly granted, those
necessarily implied therefrom, as well as powers necessary, appropriate, or incidental for its efficient and
effective governance, and those which are essential to the promotion of the general welfare. Within their
respective territorial jurisdictions, local government units shall ensure and support, among other things, the
preservation and enrichment of culture, promote health and safety, enhance the right of the people to a
balanced ecology, encourage and support the development of appropriate and self-reliant scientific and
technological capabilities, improve public morals, enhance economic prosperity and social justice, promote full
employment among their residents, maintain peace and order, and preserve the comfort and convenience of
their inhabitants.

In addition, Section 458 of the said Code specifically declares that:

Sec. 458. — Powers, Duties, Functions and Compensation. — (a) The Sangguniang Panlungsod, as the legislative
body of the city, shall enact ordinances, approve resolutions and appropriate funds for the general welfare of
the city and its inhabitants pursuant to Section 16 of this Code and in the proper exercise of the corporate
powers of the city as provided for under Section 22 of this Code, and shall:

(1) Approve ordinances and pass resolutions necessary for an efficient and effective city government, and in this
connection, shall:
xxx xxx xxx
(v) Enact ordinances intended to prevent, suppress and impose appropriate penalties for habitual
drunkenness in public places, vagrancy, mendicancy, prostitution, establishment and maintenance of
houses of ill repute, gamblingand other prohibited games of chance, fraudulent devices and ways to
obtain money or property, drug addiction, maintenance of drug dens, drug pushing, juvenile
delinquency, the printing, distribution or exhibition of obscene or pornographic materials or
publications, and such other activities inimical to the welfare and morals of the inhabitants of the city;

This section also authorizes the local government units to regulate properties and businesses within their territorial
limits in the interest of the general welfare. 5

The petitioners argue that by virtue of these provisions, the Sangguniang Panlungsod may prohibit the operation of
casinos because they involve games of chance, which are detrimental to the people. Gambling is not allowed by general
law and even by the Constitution itself. The legislative power conferred upon local government units may be exercised
over all kinds of gambling and not only over "illegal gambling" as the respondents erroneously argue. Even if the
operation of casinos may have been permitted under P.D. 1869, the government of Cagayan de Oro City has the
authority to prohibit them within its territory pursuant to the authority entrusted to it by the Local Government Code.

It is submitted that this interpretation is consonant with the policy of local autonomy as mandated in Article II, Section
25, and Article X of the Constitution, as well as various other provisions therein seeking to strengthen the character of
the nation. In giving the local government units the power to prevent or suppress gambling and other social problems,
the Local Government Code has recognized the competence of such communities to determine and adopt the measures
best expected to promote the general welfare of their inhabitants in line with the policies of the State.

The petitioners also stress that when the Code expressly authorized the local government units to prevent and suppress
gambling and other prohibited games of chance, like craps, baccarat, blackjack and roulette, it meant allforms of
gambling without distinction. Ubi lex non distinguit, nec nos distinguere debemos. 6 Otherwise, it would have expressly
excluded from the scope of their power casinos and other forms of gambling authorized by special law, as it could have
easily done. The fact that it did not do so simply means that the local government units are permitted to prohibit all
kinds of gambling within their territories, including the operation of casinos.

The adoption of the Local Government Code, it is pointed out, had the effect of modifying the charter of the PAGCOR.
The Code is not only a later enactment than P.D. 1869 and so is deemed to prevail in case of inconsistencies between
them. More than this, the powers of the PAGCOR under the decree are expressly discontinued by the Code insofar as
they do not conform to its philosophy and provisions, pursuant to Par. (f) of its repealing clause reading as follows:

(f) All general and special laws, acts, city charters, decrees, executive orders, proclamations and administrative
regulations, or part or parts thereof which are inconsistent with any of the provisions of this Code are hereby
repealed or modified accordingly.
It is also maintained that assuming there is doubt regarding the effect of the Local Government Code on P.D. 1869, the
doubt must be resolved in favor of the petitioners, in accordance with the direction in the Code calling for its liberal
interpretation in favor of the local government units. Section 5 of the Code specifically provides:

Sec. 5. Rules of Interpretation. — In the interpretation of the provisions of this Code, the following rules shall
apply:

(a) Any provision on a power of a local government unit shall be liberally interpreted in its favor, and in case of
doubt, any question thereon shall be resolved in favor of devolution of powers and of the lower local government
unit. Any fair and reasonable doubt as to the existence of the power shall be interpreted in favor of the local
government unit concerned;
xxx xxx xxx
(c) The general welfare provisions in this Code shall be liberally interpreted to give more powers to local
government units in accelerating economic development and upgrading the quality of life for the people in the
community; . . . (Emphasis supplied.)

Finally, the petitioners also attack gambling as intrinsically harmful and cite various provisions of the Constitution and
several decisions of this Court expressive of the general and official disapprobation of the vice. They invoke the State
policies on the family and the proper upbringing of the youth and, as might be expected, call attention to the old case
of U.S. v. Salaveria,7 which sustained a municipal ordinance prohibiting the playing of panguingue. The petitioners decry
the immorality of gambling. They also impugn the wisdom of P.D. 1869 (which they describe as "a martial law
instrument") in creating PAGCOR and authorizing it to operate casinos "on land and sea within the territorial jurisdiction
of the Philippines."

This is the opportune time to stress an important point.

The morality of gambling is not a justiciable issue. Gambling is not illegal per se. While it is generally considered inimical
to the interests of the people, there is nothing in the Constitution categorically proscribing or penalizing gambling or, for
that matter, even mentioning it at all. It is left to Congress to deal with the activity as it sees fit. In the exercise of its own
discretion, the legislature may prohibit gambling altogether or allow it without limitation or it may prohibit some forms
of gambling and allow others for whatever reasons it may consider sufficient. Thus, it has
prohibited jueteng and monte but permits lotteries, cockfighting and horse-racing. In making such choices, Congress has
consulted its own wisdom, which this Court has no authority to review, much less reverse. Well has it been said that
courts do not sit to resolve the merits of conflicting theories. 8 That is the prerogative of the political departments. It is
settled that questions regarding the wisdom, morality, or practicibility of statutes are not addressed to the judiciary but
may be resolved only by the legislative and executive departments, to which the function belongs in our scheme of
government. That function is exclusive. Whichever way these branches decide, they are answerable only to their own
conscience and the constituents who will ultimately judge their acts, and not to the courts of justice.

The only question we can and shall resolve in this petition is the validity of Ordinance No. 3355 and Ordinance No. 3375-
93 as enacted by the Sangguniang Panlungsod of Cagayan de Oro City. And we shall do so only by the criteria laid down
by law and not by our own convictions on the propriety of gambling.

The tests of a valid ordinance are well established. A long line of decisions 9 has held that to be valid, an ordinance must
conform to the following substantive requirements:

1) It must not contravene the constitution or any statute.


2) It must not be unfair or oppressive.
3) It must not be partial or discriminatory.
4) It must not prohibit but may regulate trade.
5) It must be general and consistent with public policy.
6) It must not be unreasonable.
We begin by observing that under Sec. 458 of the Local Government Code, local government units are authorized to
prevent or suppress, among others, "gambling and other prohibited games of chance." Obviously, this provision excludes
games of chance which are not prohibited but are in fact permitted by law. The petitioners are less than accurate in
claiming that the Code could have excluded such games of chance but did not. In fact it does. The language of the
section is clear and unmistakable. Under the rule of noscitur a sociis, a word or phrase should be interpreted in relation
to, or given the same meaning of, words with which it is associated. Accordingly, we conclude that since the word
"gambling" is associated with "and other prohibited games of chance," the word should be read as referring to only
illegal gambling which, like the other prohibited games of chance, must be prevented or suppressed.

We could stop here as this interpretation should settle the problem quite conclusively. But we will not. The vigorous
efforts of the petitioners on behalf of the inhabitants of Cagayan de Oro City, and the earnestness of their advocacy,
deserve more than short shrift from this Court.

The apparent flaw in the ordinances in question is that they contravene P.D. 1869 and the public policy embodied
therein insofar as they prevent PAGCOR from exercising the power conferred on it to operate a casino in Cagayan de Oro
City. The petitioners have an ingenious answer to this misgiving. They deny that it is the ordinances that have changed
P.D. 1869 for an ordinance admittedly cannot prevail against a statute. Their theory is that the change has been made by
the Local Government Code itself, which was also enacted by the national lawmaking authority. In their view, the decree
has been, not really repealed by the Code, but merely "modified pro tanto" in the sense that PAGCOR cannot now
operate a casino over the objection of the local government unit concerned. This modification of P.D. 1869 by the Local
Government Code is permissible because one law can change or repeal another law.

It seems to us that the petitioners are playing with words. While insisting that the decree has only been "modifiedpro
tanto," they are actually arguing that it is already dead, repealed and useless for all intents and purposes because the
Code has shorn PAGCOR of all power to centralize and regulate casinos. Strictly speaking, its operations may now be not
only prohibited by the local government unit; in fact, the prohibition is not only discretionary but mandated by Section
458 of the Code if the word "shall" as used therein is to be given its accepted meaning. Local government units have
now no choice but to prevent and suppress gambling, which in the petitioners' view includes both legal and illegal
gambling. Under this construction, PAGCOR will have no more games of chance to regulate or centralize as they must all
be prohibited by the local government units pursuant to the mandatory duty imposed upon them by the Code. In this
situation, PAGCOR cannot continue to exist except only as a toothless tiger or a white elephant and will no longer be
able to exercise its powers as a prime source of government revenue through the operation of casinos.

It is noteworthy that the petitioners have cited only Par. (f) of the repealing clause, conveniently discarding the rest of
the provision which painstakingly mentions the specific laws or the parts thereof which are repealed (or modified) by
the Code. Significantly, P.D. 1869 is not one of them. A reading of the entire repealing clause, which is reproduced
below, will disclose the omission:

Sec. 534. Repealing Clause. — (a) Batas Pambansa Blg. 337, otherwise known as the "Local Government Code,"
Executive Order No. 112 (1987), and Executive Order No. 319 (1988) are hereby repealed.

(b) Presidential Decree Nos. 684, 1191, 1508 and such other decrees, orders, instructions, memoranda and
issuances related to or concerning the barangay are hereby repealed.

(c) The provisions of Sections 2, 3, and 4 of Republic Act No. 1939 regarding hospital fund; Section 3, a (3) and b
(2) of Republic Act. No. 5447 regarding the Special Education Fund; Presidential Decree No. 144 as amended by
Presidential Decree Nos. 559 and 1741; Presidential Decree No. 231 as amended; Presidential Decree No. 436 as
amended by Presidential Decree No. 558; and Presidential Decree Nos. 381, 436, 464, 477, 526, 632, 752, and
1136 are hereby repealed and rendered of no force and effect.

(d) Presidential Decree No. 1594 is hereby repealed insofar as it governs locally-funded projects.
(e) The following provisions are hereby repealed or amended insofar as they are inconsistent with the provisions
of this Code: Sections 2, 16, and 29 of Presidential Decree No. 704; Sections 12 of Presidential Decree No. 87, as
amended; Sections 52, 53, 66, 67, 68, 69, 70, 71, 72, 73, and 74 of Presidential Decree No. 463, as amended; and
Section 16 of Presidential Decree No. 972, as amended, and

(f) All general and special laws, acts, city charters, decrees, executive orders, proclamations and administrative
regulations, or part or parts thereof which are inconsistent with any of the provisions of this Code are hereby
repealed or modified accordingly.

Furthermore, it is a familiar rule that implied repeals are not lightly presumed in the absence of a clear and unmistakable
showing of such intention. In Lichauco & Co. v. Apostol, 10 this Court explained:

The cases relating to the subject of repeal by implication all proceed on the assumption that if the act of later
date clearly reveals an intention on the part of the lawmaking power to abrogate the prior law, this intention
must be given effect; but there must always be a sufficient revelation of this intention, and it has become an
unbending rule of statutory construction that the intention to repeal a former law will not be imputed to the
Legislature when it appears that the two statutes, or provisions, with reference to which the question arises
bear to each other the relation of general to special.

There is no sufficient indication of an implied repeal of P.D. 1869. On the contrary, as the private respondent points out,
PAGCOR is mentioned as the source of funding in two later enactments of Congress, to wit, R.A. 7309, creating a Board
of Claims under the Department of Justice for the benefit of victims of unjust punishment or detention or of violent
crimes, and R.A. 7648, providing for measures for the solution of the power crisis. PAGCOR revenues are tapped by
these two statutes. This would show that the PAGCOR charter has not been repealed by the Local Government Code but
has in fact been improved as it were to make the entity more responsive to the fiscal problems of the government.

It is a canon of legal hermeneutics that instead of pitting one statute against another in an inevitably destructive
confrontation, courts must exert every effort to reconcile them, remembering that both laws deserve a becoming
respect as the handiwork of a coordinate branch of the government. On the assumption of a conflict between P.D. 1869
and the Code, the proper action is not to uphold one and annul the other but to give effect to both by harmonizing them
if possible. This is possible in the case before us. The proper resolution of the problem at hand is to hold that under the
Local Government Code, local government units may (and indeed must) prevent and suppress all kinds of gambling
within their territories except only those allowed by statutes like P.D. 1869. The exception reserved in such laws must be
read into the Code, to make both the Code and such laws equally effective and mutually complementary.

This approach would also affirm that there are indeed two kinds of gambling, to wit, the illegal and those authorized by
law. Legalized gambling is not a modern concept; it is probably as old as illegal gambling, if not indeed more so. The
petitioners' suggestion that the Code authorizes them to prohibit all kinds of gambling would erase the distinction
between these two forms of gambling without a clear indication that this is the will of the legislature. Plausibly,
following this theory, the City of Manila could, by mere ordinance, prohibit the Philippine Charity Sweepstakes Office
from conducting a lottery as authorized by R.A. 1169 and B.P. 42 or stop the races at the San Lazaro Hippodrome as
authorized by R.A. 309 and R.A. 983.

In light of all the above considerations, we see no way of arriving at the conclusion urged on us by the petitioners that
the ordinances in question are valid. On the contrary, we find that the ordinances violate P.D. 1869, which has the
character and force of a statute, as well as the public policy expressed in the decree allowing the playing of certain
games of chance despite the prohibition of gambling in general.

The rationale of the requirement that the ordinances should not contravene a statute is obvious. Municipal
governments are only agents of the national government. Local councils exercise only delegated legislative powers
conferred on them by Congress as the national lawmaking body. The delegate cannot be superior to the principal or
exercise powers higher than those of the latter. It is a heresy to suggest that the local government units can undo the
acts of Congress, from which they have derived their power in the first place, and negate by mere ordinance the
mandate of the statute.

Municipal corporations owe their origin to, and derive their powers and rights wholly from the legislature. It
breathes into them the breath of life, without which they cannot exist. As it creates, so it may destroy. As it may
destroy, it may abridge and control. Unless there is some constitutional limitation on the right, the legislature
might, by a single act, and if we can suppose it capable of so great a folly and so great a wrong, sweep from
existence all of the municipal corporations in the State, and the corporation could not prevent it. We know of no
limitation on the right so far as to the corporation themselves are concerned. They are, so to phrase it, the mere
tenants at will of the legislature. 11

This basic relationship between the national legislature and the local government units has not been enfeebled by the
new provisions in the Constitution strengthening the policy of local autonomy. Without meaning to detract from that
policy, we here confirm that Congress retains control of the local government units although in significantly reduced
degree now than under our previous Constitutions. The power to create still includes the power to destroy. The power
to grant still includes the power to withhold or recall. True, there are certain notable innovations in the Constitution, like
the direct conferment on the local government units of the power to tax, 12 which cannot now be withdrawn by mere
statute. By and large, however, the national legislature is still the principal of the local government units, which cannot
defy its will or modify or violate it.

The Court understands and admires the concern of the petitioners for the welfare of their constituents and their
apprehensions that the welfare of Cagayan de Oro City will be endangered by the opening of the casino. We share the
view that "the hope of large or easy gain, obtained without special effort, turns the head of the workman" 13 and that
"habitual gambling is a cause of laziness and ruin." 14 In People v. Gorostiza, 15 we declared: "The social scourge of
gambling must be stamped out. The laws against gambling must be enforced to the limit." George Washington called
gambling "the child of avarice, the brother of iniquity and the father of mischief." Nevertheless, we must recognize the
power of the legislature to decide, in its own wisdom, to legalize certain forms of gambling, as was done in P.D. 1869
and impliedly affirmed in the Local Government Code. That decision can be revoked by this Court only if it contravenes
the Constitution as the touchstone of all official acts. We do not find such contravention here.

We hold that the power of PAGCOR to centralize and regulate all games of chance, including casinos on land and sea
within the territorial jurisdiction of the Philippines, remains unimpaired. P.D. 1869 has not been modified by the Local
Government Code, which empowers the local government units to prevent or suppress only those forms of gambling
prohibited by law.

Casino gambling is authorized by P.D. 1869. This decree has the status of a statute that cannot be amended or nullified
by a mere ordinance. Hence, it was not competent for the Sangguniang Panlungsod of Cagayan de Oro City to enact
Ordinance No. 3353 prohibiting the use of buildings for the operation of a casino and Ordinance No. 3375-93 prohibiting
the operation of casinos. For all their praiseworthy motives, these ordinances are contrary to P.D. 1869 and the public
policy announced therein and are therefore ultra vires and void.

WHEREFORE, the petition is DENIED and the challenged decision of the respondent Court of Appeals is AFFIRMED, with
costs against the petitioners. It is so ordered.

Narvasa, C.J., Feliciano, Bidin, Regalado, Romero, Bellosillo, Melo, Quiason, Puno, Vitug, Kapunan and Mendoza,
JJ., concur.
G.R. No. 91649 May 14, 1991
ATTORNEYS HUMBERTO BASCO, EDILBERTO BALCE, SOCRATES MARANAN AND LORENZO SANCHEZ,petitioners,
vs.
PHILIPPINE AMUSEMENTS AND GAMING CORPORATION (PAGCOR), respondent.
H.B. Basco & Associates for petitioners.
Valmonte Law Offices collaborating counsel for petitioners.
Aguirre, Laborte and Capule for respondent PAGCOR.

PARAS, J.:

A TV ad proudly announces:

"The new PAGCOR — responding through responsible gaming."

But the petitioners think otherwise, that is why, they filed the instant petition seeking to annul the Philippine
Amusement and Gaming Corporation (PAGCOR) Charter — PD 1869, because it is allegedly contrary to morals, public
policy and order, and because —

A. It constitutes a waiver of a right prejudicial to a third person with a right recognized by law. It waived the
Manila City government's right to impose taxes and license fees, which is recognized by law;

B. For the same reason stated in the immediately preceding paragraph, the law has intruded into the local
government's right to impose local taxes and license fees. This, in contravention of the constitutionally
enshrined principle of local autonomy;

C. It violates the equal protection clause of the constitution in that it legalizes PAGCOR — conducted gambling,
while most other forms of gambling are outlawed, together with prostitution, drug trafficking and other vices;

D. It violates the avowed trend of the Cory government away from monopolistic and crony economy, and
toward free enterprise and privatization. (p. 2, Amended Petition; p. 7, Rollo)

In their Second Amended Petition, petitioners also claim that PD 1869 is contrary to the declared national policy of the
"new restored democracy" and the people's will as expressed in the 1987 Constitution. The decree is said to have a
"gambling objective" and therefore is contrary to Sections 11, 12 and 13 of Article II, Sec. 1 of Article VIII and Section 3
(2) of Article XIV, of the present Constitution (p. 3, Second Amended Petition; p. 21, Rollo).

The procedural issue is whether petitioners, as taxpayers and practicing lawyers (petitioner Basco being also the
Chairman of the Committee on Laws of the City Council of Manila), can question and seek the annulment of PD 1869 on
the alleged grounds mentioned above.

The Philippine Amusements and Gaming Corporation (PAGCOR) was created by virtue of P.D. 1067-A dated January 1,
1977 and was granted a franchise under P.D. 1067-B also dated January 1, 1977 "to establish, operate and maintain
gambling casinos on land or water within the territorial jurisdiction of the Philippines." Its operation was originally
conducted in the well known floating casino "Philippine Tourist." The operation was considered a success for it proved
to be a potential source of revenue to fund infrastructure and socio-economic projects, thus, P.D. 1399 was passed on
June 2, 1978 for PAGCOR to fully attain this objective.

Subsequently, on July 11, 1983, PAGCOR was created under P.D. 1869 to enable the Government to regulate and
centralize all games of chance authorized by existing franchise or permitted by law, under the following declared policy

Sec. 1. Declaration of Policy. — It is hereby declared to be the policy of the State to centralize and integrate all
games of chance not heretofore authorized by existing franchises or permitted by law in order to attain the
following objectives:

(a) To centralize and integrate the right and authority to operate and conduct games of chance into one
corporate entity to be controlled, administered and supervised by the Government.

(b) To establish and operate clubs and casinos, for amusement and recreation, including sports gaming pools,
(basketball, football, lotteries, etc.) and such other forms of amusement and recreation including games of
chance, which may be allowed by law within the territorial jurisdiction of the Philippines and which will: (1)
generate sources of additional revenue to fund infrastructure and socio-civic projects, such as flood control
programs, beautification, sewerage and sewage projects, Tulungan ng Bayan Centers, Nutritional Programs,
Population Control and such other essential public services; (2) create recreation and integrated facilities which
will expand and improve the country's existing tourist attractions; and (3) minimize, if not totally eradicate, all
the evils, malpractices and corruptions that are normally prevalent on the conduct and operation of gambling
clubs and casinos without direct government involvement. (Section 1, P.D. 1869)

To attain these objectives PAGCOR is given territorial jurisdiction all over the Philippines. Under its Charter's repealing
clause, all laws, decrees, executive orders, rules and regulations, inconsistent therewith, are accordingly repealed,
amended or modified.

It is reported that PAGCOR is the third largest source of government revenue, next to the Bureau of Internal Revenue
and the Bureau of Customs. In 1989 alone, PAGCOR earned P3.43 Billion, and directly remitted to the National
Government a total of P2.5 Billion in form of franchise tax, government's income share, the President's Social Fund and
Host Cities' share. In addition, PAGCOR sponsored other socio-cultural and charitable projects on its own or in
cooperation with various governmental agencies, and other private associations and organizations. In its 3 1/2 years of
operation under the present administration, PAGCOR remitted to the government a total of P6.2 Billion. As of December
31, 1989, PAGCOR was employing 4,494 employees in its nine (9) casinos nationwide, directly supporting the livelihood
of Four Thousand Four Hundred Ninety-Four (4,494) families.

But the petitioners, are questioning the validity of P.D. No. 1869. They allege that the same is "null and void" for being
"contrary to morals, public policy and public order," monopolistic and tends toward "crony economy", and is violative of
the equal protection clause and local autonomy as well as for running counter to the state policies enunciated in
Sections 11 (Personal Dignity and Human Rights), 12 (Family) and 13 (Role of Youth) of Article II, Section 1 (Social Justice)
of Article XIII and Section 2 (Educational Values) of Article XIV of the 1987 Constitution.

This challenge to P.D. No. 1869 deserves a searching and thorough scrutiny and the most deliberate consideration by the
Court, involving as it does the exercise of what has been described as "the highest and most delicate function which
belongs to the judicial department of the government." (State v. Manuel, 20 N.C. 144; Lozano v. Martinez, 146 SCRA
323).

As We enter upon the task of passing on the validity of an act of a co-equal and coordinate branch of the government
We need not be reminded of the time-honored principle, deeply ingrained in our jurisprudence, that a statute is
presumed to be valid. Every presumption must be indulged in favor of its constitutionality. This is not to say that We
approach Our task with diffidence or timidity. Where it is clear that the legislature or the executive for that matter, has
over-stepped the limits of its authority under the constitution, We should not hesitate to wield the axe and let it fall
heavily, as fall it must, on the offending statute (Lozano v. Martinez, supra).

In Victoriano v. Elizalde Rope Workers' Union, et al, 59 SCRA 54, the Court thru Mr. Justice Zaldivar underscored the —

. . . thoroughly established principle which must be followed in all cases where questions of constitutionality as
obtain in the instant cases are involved. All presumptions are indulged in favor of constitutionality; one who
attacks a statute alleging unconstitutionality must prove its invalidity beyond a reasonable doubt; that a law may
work hardship does not render it unconstitutional; that if any reasonable basis may be conceived which supports
the statute, it will be upheld and the challenger must negate all possible basis; that the courts are not concerned
with the wisdom, justice, policy or expediency of a statute and that a liberal interpretation of the constitution in
favor of the constitutionality of legislation should be adopted. (Danner v. Hass, 194 N.W. 2nd534, 539; Spurbeck
v. Statton, 106 N.W. 2nd 660, 663; 59 SCRA 66; see also e.g. Salas v. Jarencio, 46 SCRA 734, 739 [1970]; Peralta v.
Commission on Elections, 82 SCRA 30, 55 [1978]; and Heirs of Ordona v. Reyes, 125 SCRA 220, 241-242 [1983]
cited in Citizens Alliance for Consumer Protection v. Energy Regulatory Board, 162 SCRA 521, 540)

Of course, there is first, the procedural issue. The respondents are questioning the legal personality of petitioners to file
the instant petition.

Considering however the importance to the public of the case at bar, and in keeping with the Court's duty, under the
1987 Constitution, to determine whether or not the other branches of government have kept themselves within the
limits of the Constitution and the laws and that they have not abused the discretion given to them, the Court has
brushed aside technicalities of procedure and has taken cognizance of this petition. (Kapatiran ng mga Naglilingkod sa
Pamahalaan ng Pilipinas Inc. v. Tan, 163 SCRA 371)

With particular regard to the requirement of proper party as applied in the cases before us, We hold that the
same is satisfied by the petitioners and intervenors because each of them has sustained or is in danger of
sustaining an immediate injury as a result of the acts or measures complained of. And even if, strictly speaking
they are not covered by the definition, it is still within the wide discretion of the Court to waive the requirement
and so remove the impediment to its addressing and resolving the serious constitutional questions raised.

In the first Emergency Powers Cases, ordinary citizens and taxpayers were allowed to question the
constitutionality of several executive orders issued by President Quirino although they were involving only an
indirect and general interest shared in common with the public. The Court dismissed the objection that they
were not proper parties and ruled that "the transcendental importance to the public of these cases demands
that they be settled promptly and definitely, brushing aside, if we must technicalities of procedure." We have
since then applied the exception in many other cases. (Association of Small Landowners in the Philippines, Inc. v.
Sec. of Agrarian Reform, 175 SCRA 343).

Having disposed of the procedural issue, We will now discuss the substantive issues raised.

Gambling in all its forms, unless allowed by law, is generally prohibited. But the prohibition of gambling does not mean
that the Government cannot regulate it in the exercise of its police power.

The concept of police power is well-established in this jurisdiction. It has been defined as the "state authority to enact
legislation that may interfere with personal liberty or property in order to promote the general welfare." (Edu v. Ericta,
35 SCRA 481, 487) As defined, it consists of (1) an imposition or restraint upon liberty or property, (2) in order to foster
the common good. It is not capable of an exact definition but has been, purposely, veiled in general terms to underscore
its all-comprehensive embrace. (Philippine Association of Service Exporters, Inc. v. Drilon, 163 SCRA 386).

Its scope, ever-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 assuming the greatest
benefits. (Edu v. Ericta, supra)

It finds no specific Constitutional grant for the plain reason that it does not owe its origin to the charter. Along with the
taxing power and eminent domain, it is inborn in the very fact of statehood and sovereignty. It is a fundamental
attribute of government that has enabled it to perform the most vital functions of governance. Marshall, to whom the
expression has been credited, refers to it succinctly as the plenary power of the state "to govern its citizens". (Tribe,
American Constitutional Law, 323, 1978). The police power of the State is a power co-extensive with self-protection and
is most aptly termed the "law of overwhelming necessity." (Rubi v. Provincial Board of Mindoro, 39 Phil. 660, 708) It is
"the most essential, insistent, and illimitable of powers." (Smith Bell & Co. v. National, 40 Phil. 136) It is a dynamic force
that enables the state to meet the agencies of the winds of change.

What was the reason behind the enactment of P.D. 1869?

P.D. 1869 was enacted pursuant to the policy of the government to "regulate and centralize thru an appropriate
institution all games of chance authorized by existing franchise or permitted by law" (1st whereas clause, PD 1869). As
was subsequently proved, regulating and centralizing gambling operations in one corporate entity — the PAGCOR, was
beneficial not just to the Government but to society in general. It is a reliable source of much needed revenue for the
cash strapped Government. It provided funds for social impact projects and subjected gambling to "close scrutiny,
regulation, supervision and control of the Government" (4th Whereas Clause, PD 1869). With the creation of PAGCOR
and the direct intervention of the Government, the evil practices and corruptions that go with gambling will be
minimized if not totally eradicated. Public welfare, then, lies at the bottom of the enactment of PD 1896.

Petitioners contend that P.D. 1869 constitutes a waiver of the right of the City of Manila to impose taxes and legal fees;
that the exemption clause in P.D. 1869 is violative of the principle of local autonomy. They must be referring to Section
13 par. (2) of P.D. 1869 which exempts PAGCOR, as the franchise holder from paying any "tax of any kind or form,
income or otherwise, as well as fees, charges or levies of whatever nature, whether National or Local."

(2) Income and other taxes. — a) Franchise Holder: No tax of any kind or form, income or otherwise as well as
fees, charges or levies of whatever nature, whether National or Local, shall be assessed and collected under this
franchise from the Corporation; nor shall any form or tax or charge attach in any way to the earnings of the
Corporation, except a franchise tax of five (5%) percent of the gross revenues or earnings derived by the
Corporation from its operations under this franchise. Such tax shall be due and payable quarterly to the National
Government and shall be in lieu of all kinds of taxes, levies, fees or assessments of any kind, nature or
description, levied, established or collected by any municipal, provincial or national government authority
(Section 13 [2]).

Their contention stated hereinabove is without merit for the following reasons:

(a) The City of Manila, being a mere Municipal corporation has no inherent right to impose taxes (Icard v. City of Baguio,
83 Phil. 870; City of Iloilo v. Villanueva, 105 Phil. 337; Santos v. Municipality of Caloocan, 7 SCRA 643). Thus, "the Charter
or statute must plainly show an intent to confer that power or the municipality cannot assume it" (Medina v. City of
Baguio, 12 SCRA 62). Its "power to tax" therefore must always yield to a legislative act which is superior having been
passed upon by the state itself which has the "inherent power to tax" (Bernas, the Revised [1973] Philippine
Constitution, Vol. 1, 1983 ed. p. 445).

(b) The Charter of the City of Manila is subject to control by Congress. It should be stressed that "municipal corporations
are mere creatures of Congress" (Unson v. Lacson, G.R. No. 7909, January 18, 1957) which has the power to "create and
abolish municipal corporations" due to its "general legislative powers" (Asuncion v. Yriantes, 28 Phil. 67; Merdanillo v.
Orandia, 5 SCRA 541). Congress, therefore, has the power of control over Local governments (Hebron v. Reyes, G.R. No.
9124, July 2, 1950). And if Congress can grant the City of Manila the power to tax certain matters, it can also provide for
exemptions or even take back the power.

(c) The City of Manila's power to impose license fees on gambling, has long been revoked. As early as 1975, the power of
local governments to regulate gambling thru the grant of "franchise, licenses or permits" was withdrawn by P.D. No. 771
and was vested exclusively on the National Government, thus:

Sec. 1. Any provision of law to the contrary notwithstanding, the authority of chartered cities and other local
governments to issue license, permit or other form of franchise to operate, maintain and establish horse and
dog race tracks, jai-alai and other forms of gambling is hereby revoked.
Sec. 2. Hereafter, all permits or franchises to operate, maintain and establish, horse and dog race tracks, jai-alai
and other forms of gambling shall be issued by the national government upon proper application and
verification of the qualification of the applicant . . .

Therefore, only the National Government has the power to issue "licenses or permits" for the operation of gambling.
Necessarily, the power to demand or collect license fees which is a consequence of the issuance of "licenses or permits"
is no longer vested in the City of Manila.

(d) Local governments have no power to tax instrumentalities of the National Government. PAGCOR is a government
owned or controlled corporation with an original charter, PD 1869. All of its shares of stocks are owned by the National
Government. In addition to its corporate powers (Sec. 3, Title II, PD 1869) it also exercises regulatory powers thus:

Sec. 9. Regulatory Power. — The Corporation shall maintain a Registry of the affiliated entities, and shall exercise
all the powers, authority and the responsibilities vested in the Securities and Exchange Commission over such
affiliating entities mentioned under the preceding section, including, but not limited to amendments of Articles
of Incorporation and By-Laws, changes in corporate term, structure, capitalization and other matters concerning
the operation of the affiliated entities, the provisions of the Corporation Code of the Philippines to the contrary
notwithstanding, except only with respect to original incorporation.

PAGCOR has a dual role, to operate and to regulate gambling casinos. The latter role is governmental, which places it in
the category of an agency or instrumentality of the Government. Being an instrumentality of the Government, PAGCOR
should be and actually is exempt from local taxes. Otherwise, its operation might be burdened, impeded or subjected to
control by a mere Local government.

The states have no power by taxation or otherwise, to retard, impede, burden or in any manner control the
operation of constitutional laws enacted by Congress to carry into execution the powers vested in the federal
government. (MC Culloch v. Marland, 4 Wheat 316, 4 L Ed. 579)

This doctrine emanates from the "supremacy" of the National Government over local governments.

Justice Holmes, speaking for the Supreme Court, made reference to the entire absence of power on the part of
the States to touch, in that way (taxation) at least, the instrumentalities of the United States (Johnson v.
Maryland, 254 US 51) and it can be agreed that no state or political subdivision can regulate a federal
instrumentality in such a way as to prevent it from consummating its federal responsibilities, or even to seriously
burden it in the accomplishment of them. (Antieau, Modern Constitutional Law, Vol. 2, p. 140, emphasis
supplied)

Otherwise, mere creatures of the State can defeat National policies thru extermination of what local authorities may
perceive to be undesirable activities or enterprise using the power to tax as "a tool for regulation" (U.S. v. Sanchez, 340
US 42).

The power to tax which was called by Justice Marshall as the "power to destroy" (Mc Culloch v. Maryland, supra) cannot
be allowed to defeat an instrumentality or creation of the very entity which has the inherent power to wield it.

(e) Petitioners also argue that the Local Autonomy Clause of the Constitution will be violated by P.D. 1869. This is a
pointless argument. Article X of the 1987 Constitution (on Local Autonomy) provides:

Sec. 5. Each local government unit shall have the power to create its own source of revenue and to levy taxes,
fees, and other charges subject to such guidelines and limitation as the congress may provide, consistent with
the basic policy on local autonomy. Such taxes, fees and charges shall accrue exclusively to the local
government. (emphasis supplied)
The power of local government to "impose taxes and fees" is always subject to "limitations" which Congress may
provide by law. Since PD 1869 remains an "operative" law until "amended, repealed or revoked" (Sec. 3, Art. XVIII, 1987
Constitution), its "exemption clause" remains as an exception to the exercise of the power of local governments to
impose taxes and fees. It cannot therefore be violative but rather is consistent with the principle of local autonomy.

Besides, the principle of local autonomy under the 1987 Constitution simply means "decentralization" (III Records of the
1987 Constitutional Commission, pp. 435-436, as cited in Bernas, The Constitution of the Republic of the Philippines, Vol.
II, First Ed., 1988, p. 374). It does not make local governments sovereign within the state or an "imperium in imperio."

Local Government has been described as a political subdivision of a nation or state which is constituted by law
and has substantial control of local affairs. In a unitary system of government, such as the government under the
Philippine Constitution, local governments can only be an intra sovereign subdivision of one sovereign nation, it
cannot be an imperium in imperio. Local government in such a system can only mean a measure of
decentralization of the function of government. (emphasis supplied)

As to what state powers should be "decentralized" and what may be delegated to local government units remains a
matter of policy, which concerns wisdom. It is therefore a political question. (Citizens Alliance for Consumer Protection
v. Energy Regulatory Board, 162 SCRA 539).

What is settled is that the matter of regulating, taxing or otherwise dealing with gambling is a State concern and hence,
it is the sole prerogative of the State to retain it or delegate it to local governments.

As gambling is usually an offense against the State, legislative grant or express charter power is generally
necessary to empower the local corporation to deal with the subject. . . . In the absence of express grant of
power to enact, ordinance provisions on this subject which are inconsistent with the state laws are void. (Ligan v.
Gadsden, Ala App. 107 So. 733 Ex-Parte Solomon, 9, Cals. 440, 27 PAC 757 following in re Ah You, 88 Cal. 99, 25
PAC 974, 22 Am St. Rep. 280, 11 LRA 480, as cited in Mc Quinllan Vol. 3 Ibid, p. 548, emphasis supplied)

Petitioners next contend that P.D. 1869 violates the equal protection clause of the Constitution, because "it legalized
PAGCOR — conducted gambling, while most gambling are outlawed together with prostitution, drug trafficking and
other vices" (p. 82, Rollo).

We, likewise, find no valid ground to sustain this contention. The petitioners' posture ignores the well-accepted meaning
of the clause "equal protection of the laws." The clause does not preclude classification of individuals who may be
accorded different treatment under the law as long as the classification is not unreasonable or arbitrary (Itchong v.
Hernandez, 101 Phil. 1155). A law does not have to operate in equal force on all persons or things to be conformable to
Article III, Section 1 of the Constitution (DECS v. San Diego, G.R. No. 89572, December 21, 1989).

The "equal protection clause" does not prohibit the Legislature from establishing classes of individuals or objects upon
which different rules shall operate (Laurel v. Misa, 43 O.G. 2847). The Constitution does not require situations which are
different in fact or opinion to be treated in law as though they were the same (Gomez v. Palomar, 25 SCRA 827).

Just how P.D. 1869 in legalizing gambling conducted by PAGCOR is violative of the equal protection is not clearly
explained in the petition. The mere fact that some gambling activities like cockfighting (P.D 449) horse racing (R.A. 306
as amended by RA 983), sweepstakes, lotteries and races (RA 1169 as amended by B.P. 42) are legalized under certain
conditions, while others are prohibited, does not render the applicable laws, P.D. 1869 for one, unconstitutional.

If the law presumably hits the evil where it is most felt, it is not to be overthrown because there are other
instances to which it might have been applied. (Gomez v. Palomar, 25 SCRA 827)

The equal protection clause of the 14th Amendment does not mean that all occupations called by the same
name must be treated the same way; the state may do what it can to prevent which is deemed as evil and stop
short of those cases in which harm to the few concerned is not less than the harm to the public that would
insure if the rule laid down were made mathematically exact. (Dominican Hotel v. Arizona, 249 US 2651).

Anent petitioners' claim that PD 1869 is contrary to the "avowed trend of the Cory Government away from monopolies
and crony economy and toward free enterprise and privatization" suffice it to state that this is not a ground for this
Court to nullify P.D. 1869. If, indeed, PD 1869 runs counter to the government's policies then it is for the Executive
Department to recommend to Congress its repeal or amendment.

The judiciary does not settle policy issues. The Court can only declare what the law is and not what the law
should be.1âwphi1 Under our system of government, policy issues are within the domain of the political
branches of government and of the people themselves as the repository of all state power. (Valmonte v.
Belmonte, Jr., 170 SCRA 256).

On the issue of "monopoly," however, the Constitution provides that:

Sec. 19. The State shall regulate or prohibit monopolies when public interest so requires. No combinations in
restraint of trade or unfair competition shall be allowed. (Art. XII, National Economy and Patrimony)

It should be noted that, as the provision is worded, monopolies are not necessarily prohibited by the Constitution. The
state must still decide whether public interest demands that monopolies be regulated or prohibited. Again, this is a
matter of policy for the Legislature to decide.

On petitioners' allegation that P.D. 1869 violates Sections 11 (Personality Dignity) 12 (Family) and 13 (Role of Youth) of
Article II; Section 13 (Social Justice) of Article XIII and Section 2 (Educational Values) of Article XIV of the 1987
Constitution, suffice it to state also that these are merely statements of principles and, policies. As such, they are
basically not self-executing, meaning a law should be passed by Congress to clearly define and effectuate such
principles.

In general, therefore, the 1935 provisions were not intended to be self-executing principles ready for
enforcement through the courts. They were rather directives addressed to the executive and the legislature. If
the executive and the legislature failed to heed the directives of the articles the available remedy was not
judicial or political. The electorate could express their displeasure with the failure of the executive and the
legislature through the language of the ballot. (Bernas, Vol. II, p. 2)

Every law has in its favor the presumption of constitutionality (Yu Cong Eng v. Trinidad, 47 Phil. 387; Salas v. Jarencio, 48
SCRA 734; Peralta v. Comelec, 82 SCRA 30; Abbas v. Comelec, 179 SCRA 287). Therefore, for PD 1869 to be nullified, it
must be shown that there is a clear and unequivocal breach of the Constitution, not merely a doubtful and equivocal
one. In other words, the grounds for nullity must be clear and beyond reasonable doubt. (Peralta v. Comelec, supra)
Those who petition this Court to declare a law, or parts thereof, unconstitutional must clearly establish the basis for
such a declaration. Otherwise, their petition must fail. Based on the grounds raised by petitioners to challenge the
constitutionality of P.D. 1869, the Court finds that petitioners have failed to overcome the presumption. The dismissal of
this petition is therefore, inevitable. But as to whether P.D. 1869 remains a wise legislation considering the issues of
"morality, monopoly, trend to free enterprise, privatization as well as the state principles on social justice, role of youth
and educational values" being raised, is up for Congress to determine.

As this Court held in Citizens' Alliance for Consumer Protection v. Energy Regulatory Board, 162 SCRA 521 —

Presidential Decree No. 1956, as amended by Executive Order No. 137 has, in any case, in its favor the
presumption of validity and constitutionality which petitioners Valmonte and the KMU have not overturned.
Petitioners have not undertaken to identify the provisions in the Constitution which they claim to have been
violated by that statute. This Court, however, is not compelled to speculate and to imagine how the assailed
legislation may possibly offend some provision of the Constitution. The Court notes, further, in this respect that
petitioners have in the main put in question the wisdom, justice and expediency of the establishment of the
OPSF, issues which are not properly addressed to this Court and which this Court may not constitutionally pass
upon. Those issues should be addressed rather to the political departments of government: the President and
the Congress.

Parenthetically, We wish to state that gambling is generally immoral, and this is precisely so when the gambling resorted
to is excessive. This excessiveness necessarily depends not only on the financial resources of the gambler and his family
but also on his mental, social, and spiritual outlook on life. However, the mere fact that some persons may have lost
their material fortunes, mental control, physical health, or even their lives does not necessarily mean that the same are
directly attributable to gambling. Gambling may have been the antecedent, but certainly not necessarily the cause. For
the same consequences could have been preceded by an overdose of food, drink, exercise, work, and even sex.

WHEREFORE, the petition is DISMISSED for lack of merit.

SO ORDERED.

Fernan, C.J., Narvasa, Gutierrez, Jr., Cruz, Feliciano, Gancayco, Bidin, Sarmiento, Griño-Aquino, Medialdea, Regalado and
Davide, Jr., JJ., concur.
G.R. No. 93252 August 5, 1991
RODOLFO T. GANZON, petitioner,
vs.
THE HONORABLE COURT OF APPEALS and LUIS T. SANTOS, respondents.
G.R. No. 93746 August 5,1991
MARY ANN RIVERA ARTIEDA, petitioner,
vs.
HON. LUIS SANTOS, in his capacity as Secretary of the Department of Local Government, NICANOR M. PATRICIO, in his
capacity as Chief, Legal Service of the Department of Local Government and SALVADOR CABALUNA JR., respondents.
G.R. No. 95245 August 5,1991
RODOLFO T. GANZON, petitioner,
vs.
THE HONORABLE COURT OF APPEALS and LUIS T. SANTOS, in his capacity as the Secretary of the Department of Local
Government, respondents.
Nicolas P. Sonalan for petitioner in 93252.
Romeo A. Gerochi for petitioner in 93746.
Eugenio Original for petitioner in 95245.

SARMIENTO, J.:

The petitioners take common issue on the power of the President (acting through the Secretary of Local Government),
to suspend and/or remove local officials.

The petitioners are the Mayor of Iloilo City (G.R. Nos. 93252 and 95245) and a member of the Sangguniang Panglunsod
thereof (G.R. No. 93746), respectively.

The petitions of Mayor Ganzon originated from a series of administrative complaints, ten in number, filed against him by
various city officials sometime in 1988, on various charges, among them, abuse of authority, oppression, grave
misconduct, disgraceful and immoral conduct, intimidation, culpable violation of the Constitution, and arbitrary
detention.1 The personalities involved are Joceleehn Cabaluna, a clerk at the city health office; Salvador Cabaluna, her
husband; Dr. Felicidad Ortigoza, Assistant City Health Officer; Mansueto Malabor, Vice-Mayor; Rolando Dabao, Dan
Dalido, German Gonzales, Larry Ong, and Eduardo Pefia Redondo members of the Sangguniang Panglunsod; and Pancho
Erbite, a barangay tanod. The complaints against the Mayor are set forth in the opinion of the respondent Court of
Appeals.2 We quote:

xxx xxx xxx

In her verified complaint (Annex A), Mrs. Cabaluna, a clerk assigned to the City Health, Office of Iloilo City
charged that due to political reasons, having supported the rival candidate, Mrs. Rosa 0. Caram, the petitioner
City Mayor, using as an excuse the exigency of the service and the interest of the public, pulled her out from
rightful office where her qualifications are best suited and assigned her to a work that should be the function of
a non-career service employee. To make matters worse, a utility worker in the office of the Public Services,
whose duties are alien to the complainant's duties and functions, has been detailed to take her place. The
petitioner's act are pure harassments aimed at luring her away from her permanent position or force her to
resign.

In the case of Dra. Felicidad Ortigoza, she claims that the petitioner handpicked her to perform task not befitting
her position as Assistant City Health Officer of Iloilo City; that her office was padlocked without any explanation
or justification; that her salary was withheld without cause since April 1, 1988; that when she filed her vacation
leave, she was given the run-around treatment in the approval of her leave in connivance with Dr. Rodolfo
Villegas and that she was the object of a well-engineered trumped-up charge in an administrative complaint
filed by Dr. Rodolfo Villegas (Annex B).
On the other hand, Mansuelo Malabor is the duly elected Vice-Mayor of Iloilo City and complainants Rolando
Dabao, Dan Dalido, German Gonzales, Larry Ong and Eduardo Pefia Pedondo are members of the Sangguniang
Panglunsod of the City of Iloilo. Their complaint arose out from the case where Councilor Larry Ong, whose key
to his office was unceremoniously and without previous notice, taken by petitioner. Without an office, Councilor
Ong had to hold office at Plaza Libertad, The Vice-Mayor and the other complainants sympathized with him and
decided to do the same. However, the petitioner, together with its fully-armed security men, forcefully drove
them away from Plaza Libertad. Councilor Ong denounced the petitioner's actuations the following day in the
radio station and decided to hold office at the Freedom Grandstand at Iloilo City and there were so many people
who gathered to witness the incident. However, before the group could reach the area, the petitioner, together
with his security men, led the firemen using a firetruck in dozing water to the people and the bystanders.

Another administrative case was filed by Pancho Erbite, a barangay tanod, appointed by former mayor Rosa O.
Caram. On March 13, 1988, without the benefit of charges filed against him and no warrant of arrest was issued,
Erbite was arrested and detained at the City Jail of Iloilo City upon orders of petitioner. In jail, he was allegedly
mauled by other detainees thereby causing injuries He was released only the following day.3

The Mayor thereafter answered4 and the cases were shortly set for hearing. The opinion of the Court of Appeals also set
forth the succeeding events:

xxx xxx xxx

The initial hearing in the Cabaluna and Ortigoza cases were set for hearing on June 20-21, 1988 at the Regional
Office of the Department of Local Government in Iloilo City. Notices, through telegrams, were sent to the parties
(Annex L) and the parties received them, including the petitioner. The petitioner asked for a postponement
before the scheduled date of hearing and was represented by counsel, Atty. Samuel Castro. The hearing officers,
Atty. Salvador Quebral and Atty. Marino Bermudez had to come all the way from Manila for the two-day
hearings but was actually held only on June 20,1988 in view of the inability and unpreparedness of petitioner's
counsel.

The next hearings were re-set to July 25, 26, 27,1988 in the same venue-Iloilo City. Again, the petitioner
attempted to delay the proceedings and moved for a postponement under the excuse that he had just hired his
counsel. Nonetheless, the hearing officers denied the motion to postpone, in view of the fact that the parties
were notified by telegrams of the scheduled hearings (Annex M).

In the said hearings, petitioner's counsel cross-examined the complainants and their witnesses.

Finding probable grounds and reasons, the respondent issued a preventive suspension order on August 11, 1988
to last until October 11,1988 for a period of sixty (60) days.

Then the next investigation was set on September 21, 1988 and the petitioner again asked for a postponement
to September 26,1988. On September 26, 1988, the complainants and petitioner were present, together with
their respective counsel. The petitioner sought for a postponement which was denied. In these hearings which
were held in Mala the petitioner testified in Adm. Case No. C-10298 and 10299.

The investigation was continued regarding the Malabor case and the complainants testified including their
witnesses.

On October 10, 1988, petitioner's counsel, Atty. Original moved for a postponement of the October 24, 1988
hearing to November 7 to 11, 1988 which was granted. However, the motion for change of venue as denied due
to lack of funds. At the hearing on November 7, 1988, the parties and counsel were present. Petitioner
reiterated his motion to change venue and moved for postponement anew. The counsel discussed a proposal to
take the deposition of witnesses in Iloilo City so the hearing was indefinitely postponed. However, the parties
failed to come to terms and after the parties were notified of the hearing, the investigation was set to December
13 to 15, 1988.

The petitioner sought for another postponement on the ground that his witnesses were sick or cannot attend
the investigation due to lack of transportation. The motion was denied and the petitioner was given up to
December 14, 1988 to present his evidence.

On December 14,1988, petitioner's counsel insisted on his motion for postponement and the hearing officers
gave petitioner up to December 15, 1988 to present his evidence. On December 15, 1988, the petitioner failed
to present evidence and the cases were considered submitted for resolution.

In the meantime, a prima facie evidence was found to exist in the arbitrary detention case filed by Pancho Erbite
so the respondent ordered the petitioner's second preventive suspension dated October 11, 1988 for another
sixty (60) days. The petitioner was able to obtain a restraining order and a writ of preliminary injunction in the
Regional Trial Court, Branch 33 of Iloilo City. The second preventive suspension was not enforced.5

Amidst the two successive suspensions, Mayor Ganzon instituted an action for prohibition against the respondent
Secretary of Local Government (now, Interior) in the Regional Trial Court, Iloilo City, where he succeeded in obtaining a
writ of preliminary injunction. Presently, he instituted CA-G.R. SP No. 16417, an action for prohibition, in the respondent
Court of Appeals.

Meanwhile, on May 3, 1990, the respondent Secretary issued another order, preventively suspending Mayor Ganzon for
another sixty days, the third time in twenty months, and designating meantime Vice-Mayor Mansueto Malabor as acting
mayor. Undaunted, Mayor Ganzon commenced CA-G.R. SP No. 20736 of the Court of Appeals, a petition for
prohibition,6 (Malabor it is to be noted, is one of the complainants, and hence, he is interested in seeing Mayor Ganzon
ousted.)

On September 7, 1989, the Court of Appeals rendered judgment, dismissing CA-G.R. SP No. 16417. On July 5, 1990, it
likewise promulgated a decision, dismissing CA-G.R. SP No. 20736. In a Resolution dated January 24, 1990, it issued a
Resolution certifying the petition of Mary Ann Artieda, who had been similary charged by the respondent Secretary, to
this Court.

On June 26,1990, we issued a Temporary Restraining Order, barring the respondent Secretary from implementing the
suspension orders, and restraining the enforcement of the Court of Appeals' two decisions.

In our Resolution of November 29, 1990, we consolidated all three cases. In our Resolutions of January 15, 1991, we
gave due course thereto.

Mayor Ganzon claims as a preliminary (GR No. 93252), that the Department of Local Government in hearing the ten
cases against him, had denied him due process of law and that the respondent Secretary had been "biased, prejudicial
and hostile" towards him7 arising from his (Mayor Ganzon's) alleged refusal to join the Laban ng Demokratikong Pilipino
party8 and the running political rivalry they maintained in the last congressional and local elections;9 and his alleged
refusal to operate a lottery in Iloilo City.10 He also alleges that he requested the Secretary to lift his suspension since it
had come ninety days prior to an election (the barangay elections of November 14, 1988),11 notwithstanding which, the
latter proceeded with the hearing and meted out two more suspension orders of the aforementioned cases.12 He
likewise contends that he sought to bring the cases to Iloilo City (they were held in Manila) in order to reduce the costs
of proceeding, but the Secretary rejected his request.13 He states that he asked for postponement on "valid and
justifiable"14 grounds, among them, that he was suffering from a heart ailment which required confinement; that his
"vital"15 witness was also hospitalized16 but that the latter unduly denied his request.17

Mayor Ganzon's primary argument (G.R. Nos. 93252 and 95245) is that the Secretary of Local Government is devoid, in
any event, of any authority to suspend and remove local officials, an argument reiterated by the petitioner Mary Ann
Rivera Artieda (G.R. No. 93746).
As to Mayor Ganzon's charges of denial of due process, the records do not show very clearly in what manner the Mayor
might have been deprived of his rights by the respondent Secretary. His claims that he and Secretary Luis-Santos were
(are) political rivals and that his "persecution" was politically motivated are pure speculation and although the latter
does not appear to have denied these contentions (as he, Mayor Ganzon, claims), we can not take his word for it the
way we would have under less political circumstances, considering furthermore that "political feud" has often been a
good excuse in contesting complaints.

The Mayor has failed furthermore to substantiate his say-so's that Secretary Santos had attempted to seduce him to join
the administration party and to operate a lottery in Iloilo City. Again, although the Secretary failed to rebut his
allegations, we can not accept them, at face value, much more, as judicial admissions as he would have us accept
them18 for the same reasons above-stated and furthermore, because his say so's were never corroborated by
independent testimonies. As a responsible public official, Secretary Santos, in pursuing an official function, is presumed
to be performing his duties regularly and in the absence of contrary evidence, no ill motive can be ascribed to him.

As to Mayor Ganzon's contention that he had requested the respondent Secretary to defer the hearing on account of
the ninety-day ban prescribed by Section 62 of Batas Blg. 337, the Court finds the question to be moot and academic
since we have in fact restrained the Secretary from further hearing the complaints against the petitioners.19

As to his request, finally, for postponements, the Court is afraid that he has not given any compelling reason why we
should overturn the Court of Appeals, which found no convincing reason to overrule Secretary Santos in denying his
requests. Besides, postponements are a matter of discretion on the part of the hearing officer, and based on Mayor
Ganzon's above story, we are not convinced that the Secretary has been guilty of a grave abuse of discretion.

The Court can not say, under these circumstances, that Secretary Santos' actuations deprived Mayor Ganzon of due
process of law.

We come to the core question: Whether or not the Secretary of Local Government, as the President's alter ego, can
suspend and/or remove local officials.

It is the petitioners' argument that the 1987 Constitution20 no longer allows the President, as the 1935 and 1973
Constitutions did, to exercise the power of suspension and/or removal over local officials. According to both petitioners,
the Constitution is meant, first, to strengthen self-rule by local government units and second, by deleting the phrase21 as
may be provided by law to strip the President of the power of control over local governments. It is a view, so they
contend, that finds support in the debates of the Constitutional Commission. The provision in question reads as follows:

Sec. 4. The President of the Philippines shall exercise general supervision over local governments. Provinces with
respect to component cities and municipalities, and cities and municipalities with respect to component
barangays shall ensure that the acts of their component units are within the scope of their prescribed powers
and functions.22

It modifies a counterpart provision appearing in the 1935 Constitution, which we quote:

Sec. 10. The President shall have control of all the executive departments, bureaus, or offices, exercise general
supervision over all Local governments as may be provided by law, and take care that the laws be faithfully
executed.23

The petitioners submit that the deletion (of "as may be provided by law") is significant, as their argument goes, since: (1)
the power of the President is "provided by law" and (2) hence, no law may provide for it any longer.

It is to be noted that in meting out the suspensions under question, the Secretary of Local Government acted in
consonance with the specific legal provisions of Batas Blg. 337, the Local Government Code, we quote:
Sec. 62. Notice of Hearing. — Within seven days after the complaint is filed, the Minister of local Government, or
the sanggunian concerned, as the case may be, shall require the respondent to submit his verified answer within
seven days from receipt of said complaint, and commence the hearing and investigation of the case within ten
days after receipt of such answer of the respondent. No investigation shall be held within ninety days
immediately prior to an election, and no preventive suspension shall be imposed with the said period. If
preventive suspension has been imposed prior to the aforesaid period, the preventive suspension shall be
lifted.24

Sec. 63. Preventive Suspension. — (1) Preventive suspension may be imposed by the Minister of Local
Government if the respondent is a provincial or city official, by the provincial governor if the respondent is an
elective municipal official, or by the city or municipal mayor if the respondent is an elective barangay official.

(2) Preventive suspension may be imposed at any time after the issues are joined, when there is reasonable
ground to believe that the respondent has committed the act or acts complained of, when the evidence of
culpability is strong, when the gravity of the offense so warrants, or when the continuance in office of the
respondent could influence the witnesses or pose a threat to the safety and integrity of the records and other
evidence. In all cases, preventive suspension shall not extend beyond sixty days after the start of said
suspension.

(3) At the expiration of sixty days, the suspended official shall be deemed reinstated in office without prejudice
to the continuation of the proceedings against him until its termination. However ' if the delay in the
proceedings of the case is due to his fault, neglect or request, the time of the delay shall not be counted in
computing the time of suspension.25

The issue, as the Court understands it, consists of three questions: (1) Did the 1987 Constitution, in deleting the phrase
"as may be provided by law" intend to divest the President of the power to investigate, suspend, discipline, and/or
remove local officials? (2) Has the Constitution repealed Sections 62 and 63 of the Local Government Code? (3) What is
the significance of the change in the constitutional language?

It is the considered opinion of the Court that notwithstanding the change in the constitutional language, the charter did
not intend to divest the legislature of its right or the President of her prerogative as conferred by existing legislation to
provide administrative sanctions against local officials. It is our opinion that the omission (of "as may be provided by
law") signifies nothing more than to underscore local governments' autonomy from congress and to break Congress'
"control" over local government affairs. The Constitution did not, however, intend, for the sake of local autonomy, to
deprive the legislature of all authority over municipal corporations, in particular, concerning discipline.

Autonomy does not, after all, contemplate making mini-states out of local government units, as in the federal
governments of the United States of America (or Brazil or Germany), although Jefferson is said to have compared
municipal corporations euphemistically to "small republics."26 Autonomy, in the constitutional sense, is subject to the
guiding star, though not control, of the legislature, albeit the legislative responsibility under the Constitution and as the
"supervision clause" itself suggest-is to wean local government units from over-dependence on the central government.

It is noteworthy that under the Charter, "local autonomy" is not instantly self-executing, but subject to, among other
things, the passage of a local government code,27 a local tax law,28 income distribution legislation,29 and a national
representation law,30 and measures31 designed to realize autonomy at the local level. It is also noteworthy that in spite
of autonomy, the Constitution places the local government under the general supervision of the Executive. It is
noteworthy finally, that the Charter allows Congress to include in the local government code provisions for removal of
local officials, which suggest that Congress may exercise removal powers, and as the existing Local Government Code
has done, delegate its exercise to the President. Thus:

Sec. 3. The Congress shall enact a local government code which shall provide for a more responsive and
accountable local government structure instituted through a system of decentralization with effective
mechanisms of recall, initiative, and referendum, allocate among the different local government units their
powers, responsibilities and resources, and provide for the qualifications, election, appointment and removal,
term, salaries, powers and functions and duties of local officials, and all other matters relating to the
organization and operation of the local units.32

As hereinabove indicated, the deletion of "as may be provided by law" was meant to stress, sub silencio, the objective of
the framers to strengthen local autonomy by severing congressional control of its affairs, as observed by the Court of
Appeals, like the power of local legislation.33 The Constitution did nothing more, however, and insofar as existing
legislation authorizes the President (through the Secretary of Local Government) to proceed against local officials
administratively, the Constitution contains no prohibition.

The petitioners are under the impression that the Constitution has left the President mere supervisory powers, which
supposedly excludes the power of investigation, and denied her control, which allegedly embraces disciplinary authority.
It is a mistaken impression because legally, "supervision" is not incompatible with disciplinary authority as this Court has
held,34 thus:

xxx xxx xxx

It is true that in the case of Mondano vs. Silvosa, 51 Off. Gaz., No. 6 p. 2884, this Court had occasion to discuss
the scope and extent of the power of supervision by the President over local government officials in contrast to
the power of control given to him over executive officials of our government wherein it was emphasized that the
two terms, control and supervision, are two different things which differ one from the other in meaning and
extent. Thus in that case the Court has made the following digression: "In administration law supervision means
overseeing or the power or authority of an officer to see that subordinate officers perform their duties. If the
latter fail or neglect to fulfill them the former may take such action or step as prescribed by law to make them
perform their duties. Control, on the other hand, means the power of an officer to alter or modify or nullify of
set aside what a subordinate officer had done in the performance of his duties and to substitute the judgment of
the former for that of the latter." But from this pronouncement it cannot be reasonably inferred that the power
of supervision of the President over local government officials does not include the power of investigation when
in his opinion the good of the public service so requires, as postulated in Section 64(c) of the Revised
Administrative Code. ...35

xxx xxx xxx

"Control" has been defined as "the power of an officer to alter or modify or nullify or set aside what a subordinate
officer had done in the performance of his duties and to substitute the judgment of the former for test of the
latter."36"Supervision" on the other hand means "overseeing or the power or authority of an officer to see that
subordinate officers perform their duties.37 As we held,38 however, "investigating" is not inconsistent with "overseeing",
although it is a lesser power than "altering". The impression is apparently exacerbated by the Court's pronouncements
in at least three cases, Lacson v. Roque,39 Hebron v. Reyes,40 and Mondano v. Silvosa,41 and possibly, a fourth one, Pelaez
v. Auditor General.42 In Lacson, this Court said that the President enjoyed no control powers but only supervision "as
may be provided by law,"43 a rule we reiterated in Hebron, and Mondano. In Pelaez, we stated that the President "may
not . . . suspend an elective official of a regular municipality or take any disciplinary action against him, except on appeal
from a decision of the corresponding provincial board."44 However,
neither Lacsonnor Hebron nor Mondano categorically banned the Chief Executive from exercising acts of disciplinary
authority because she did not exercise control powers, but because no law allowed her to exercise disciplinary authority.
Thus, according to Lacson:

The contention that the President has inherent power to remove or suspend municipal officers is without doubt
not well taken. Removal and suspension of public officers are always controlled by the particular law applicable
and its proper construction subject to constitutional limitations.45

In Hebron we stated:
Accordingly, when the procedure for the suspension of an officer is specified by law, the same must be deemed
mandatory and adhered to strictly, in the absence of express or clear provision to the contrary-which does not
et with respect to municipal officers ...46

In Mondano, the Court held:

... The Congress has expressly and specifically lodged the provincial supervision over municipal officials in the
provincial governor who is authorized to "receive and investigate complaints made under oath against municipal
officers for neglect of duty, oppression, corruption or other form of maladministration of office, and conviction
by final judgment of any crime involving moral turpitude." And if the charges are serious, "he shall submit
written charges touching the matter to the provincial board, furnishing a copy of such charges to the accused
either personally or by registered mail, and he may in such case suspend the officer (not being the municipal
treasurer) pending action by the board, if in his opinion the charge by one affecting the official integrity of the
officer in question." Section 86 of the Revised Administration Code adds nothing to the power of supervision to
be exercised by the Department Head over the administration of ... municipalities ... . If it be construed that it
does and such additional power is the same authority as that vested in the Department Head by section 79(c) of
the Revised Administrative Code, then such additional power must be deemed to have been abrogated by
Section 110(l), Article VII of the Constitution.47

xxx xxx xxx

In Pelaez, we stated that the President can not impose disciplinary measures on local officials except on appeal from the
provincial board pursuant to the Administrative Code.48

Thus, in those case that this Court denied the President the power (to suspend/remove) it was not because we did not
think that the President can not exercise it on account of his limited power, but because the law lodged the power
elsewhere. But in those cases ii which the law gave him the power, the Court, as in Ganzon v. Kayanan, found little
difficulty in sustaining him.49

The Court does not believe that the petitioners can rightfully point to the debates of the Constitutional Commission to
defeat the President's powers. The Court believes that the deliberations are by themselves inconclusive, because
although Commissioner Jose Nolledo would exclude the power of removal from the President,50 Commissioner Blas Ople
would not.51

The Court is consequently reluctant to say that the new Constitution has repealed the Local Government Code, Batas
Blg. 37. As we said, "supervision" and "removal" are not incompatible terms and one may stand with the other
notwithstanding the stronger expression of local autonomy under the new Charter. We have indeed held that in spite of
the approval of the Charter, Batas Blg. 337 is still in force and effect.52

As the Constitution itself declares, local autonomy means "a more responsive and accountable local government
structure instituted through a system of decentralization."53 The Constitution as we observed, does nothing more than
to break up the monopoly of the national government over the affairs of local governments and as put by political
adherents, to "liberate the local governments from the imperialism of Manila." Autonomy, however, is not meant to end
the relation of partnership and inter-dependence between the central administration and local government units, or
otherwise, to user in a regime of federalism. The Charter has not taken such a radical step. Local governments, under
the Constitution, are subject to regulation, however limited, and for no other purpose than precisely, albeit
paradoxically, to enhance self- government.

As we observed in one case,54 decentralization means devolution of national administration but not power to the local
levels. Thus:

Now, autonomy is either decentralization of administration or decentralization of power. There is


decentralization of administration when the central government delegates administrative powers to political
subdivisions in order to broaden the base of government power and in the process to make local governments
"more responsive and accountable," and "ensure their fullest development as self-reliant communities and
make them more effective partners in the pursuit of national development and social progress." At the same
time, it relieves the central government of the burden of managing local affairs and enables it to concentrate on
national concerns. The President exercises "general supervision" over them, but only to "ensure that local affairs
are administered according to law." He has no control over their acts in the sense that he can substitute their
judgments with his own.

Decentralization of power, on the other hand, involves an abdication of political power in the favor of local
governments units declared to be autonomous, In that case, the autonomous government is free to chart its
own destiny and shape its future with minimum intervention from central authorities. According to a
constitutional author, decentralization of power amounts to "self-immolation," since in that event, the
autonomous government becomes accountable not to the central authorities but to its constituency.55

The successive sixty-day suspensions imposed on Mayor Rodolfo Ganzon is albeit another matter. What bothers the
Court, and what indeed looms very large, is the fact that since the Mayor is facing ten administrative charges, the Mayor
is in fact facing the possibility of 600 days of suspension, in the event that all ten cases yield prima faciefindings. The
Court is not of course tolerating misfeasance in public office (assuming that Mayor Ganzon is guilty of misfeasance) but
it is certainly another question to make him serve 600 days of suspension, which is effectively, to suspend him out of
office. As we held:56

2. Petitioner is a duly elected municipal mayor of Lianga, Surigao del Sur. His term of office does not expire until
1986. Were it not for this information and the suspension decreed by the Sandiganbayan according to the Anti-
Graft and Corrupt Practices Act, he would have been all this while in the full discharge of his functions as such
municipal mayor. He was elected precisely to do so. As of October 26, 1983, he has been unable to. it is a basic
assumption of the electoral process implicit in the right of suffrage that the people are entitled to the services of
elective officials of their choice. For misfeasance or malfeasance, any of them could, of course, be proceeded
against administratively or, as in this instance, criminally. In either case, Ms culpability must be established.
Moreover, if there be a criminal action, he is entitled to the constitutional presumption of innocence. A
preventive suspension may be justified. Its continuance, however, for an unreasonable length of time raises a
due process question. For even if thereafter he were acquitted, in the meanwhile his right to hold office had
been nullified. Clearly, there would be in such a case an injustice suffered by him. Nor is he the only victim.
There is injustice inflicted likewise on the people of Lianga They were deprived of the services of the man they
had elected to serve as mayor. In that sense, to paraphrase Justice Cardozo, the protracted continuance of this
preventive suspension had outrun the bounds of reason and resulted in sheer oppression. A denial of due
process is thus quite manifest. It is to avoid such an unconstitutional application that the order of suspension
should be lifted.57

The plain truth is that this Court has been ill at ease with suspensions, for the above reasons,58 and so also, because it is
out of the ordinary to have a vacancy in local government. The sole objective of a suspension, as we have held,59 is
simply "to prevent the accused from hampering the normal cause of the investigation with his influence and authority
over possible witnesses"60 or to keep him off "the records and other evidence.61

It is a means, and no more, to assist prosecutors in firming up a case, if any, against an erring local official. Under the
Local Government Code, it can not exceed sixty days,62 which is to say that it need not be exactly sixty days long if a
shorter period is otherwise sufficient, and which is also to say that it ought to be lifted if prosecutors have achieved their
purpose in a shorter span.

Suspension is not a penalty and is not unlike preventive imprisonment in which the accused is held to insure his
presence at the trial. In both cases, the accused (the respondent) enjoys a presumption of innocence unless and until
found guilty.
Suspension finally is temporary and as the Local Government Code provides, it may be imposed for no more than sixty
days. As we held,63 a longer suspension is unjust and unreasonable, and we might add, nothing less than tyranny.

As we observed earlier, imposing 600 days of suspension which is not a remote possibility Mayor Ganzon is to all intents
and purposes, to make him spend the rest of his term in inactivity. It is also to make, to all intents and purposes, his
suspension permanent.

It is also, in fact, to mete out punishment in spite of the fact that the Mayor's guilt has not been proven. Worse, any
absolution will be for naught because needless to say, the length of his suspension would have, by the time he is
reinstated, wiped out his tenure considerably.

The Court is not to be mistaken for obstructing the efforts of the respondent Secretary to see that justice is done in Iloilo
City, yet it is hardly any argument to inflict on Mayor Ganzon successive suspensions when apparently, the respondent
Secretary has had sufficient time to gather the necessary evidence to build a case against the Mayor without suspending
him a day longer. What is intriguing is that the respondent Secretary has been cracking down, so to speak, on the Mayor
piecemeal apparently, to pin him down ten times the pain, when he, the respondent Secretary, could have pursued a
consolidated effort.

We reiterate that we are not precluding the President, through the Secretary of Interior from exercising a legal power,
yet we are of the opinion that the Secretary of Interior is exercising that power oppressively, and needless to say, with a
grave abuse of discretion.

The Court is aware that only the third suspension is under questions, and that any talk of future suspensions is in fact
premature. The fact remains, however, that Mayor Ganzon has been made to serve a total of 120 days of suspension
and the possibility of sixty days more is arguably around the corner (which amounts to a violation of the Local
Government Code which brings to light a pattern of suspensions intended to suspend the Mayor the rest of his natural
tenure. The Court is simply foreclosing what appears to us as a concerted effort of the State to perpetuate an arbitrary
act.

As we said, we can not tolerate such a state of affairs.

We are therefore allowing Mayor Rodolfo Ganzon to suffer the duration of his third suspension and lifting, for the
purpose, the Temporary Restraining Order earlier issued. Insofar as the seven remaining charges are concerned, we are
urging the Department of Local Government, upon the finality of this Decision, to undertake steps to expedite the same,
subject to Mayor Ganzon's usual remedies of appeal, judicial or administrative, or certiorari, if warranted, and
meanwhile, we are precluding the Secretary from meting out further suspensions based on those remaining complaints,
notwithstanding findings of prima facie evidence.

In resume the Court is laying down the following rules:

1. Local autonomy, under the Constitution, involves a mere decentralization of administration, not of power, in which
local officials remain accountable to the central government in the manner the law may provide;

2. The new Constitution does not prescribe federalism;

3. The change in constitutional language (with respect to the supervision clause) was meant but to deny legislative
control over local governments; it did not exempt the latter from legislative regulations provided regulation is consistent
with the fundamental premise of autonomy;

4. Since local governments remain accountable to the national authority, the latter may, by law, and in the manner set
forth therein, impose disciplinary action against local officials;
5. "Supervision" and "investigation" are not inconsistent terms; "investigation" does not signify "control" (which the
President does not have);

6. The petitioner, Mayor Rodolfo Ganzon. may serve the suspension so far ordered, but may no longer be suspended for
the offenses he was charged originally; provided:

a) that delays in the investigation of those charges "due to his fault, neglect or request, (the time of the delay)
shall not be counted in computing the time of suspension. [Supra, sec. 63(3)]

b) that if during, or after the expiration of, his preventive suspension, the petitioner commits another or other
crimes and abuses for which proper charges are filed against him by the aggrieved party or parties, his previous
suspension shall not be a bar to his being preventively suspended again, if warranted under subpar. (2), Section
63 of the Local Government Code.

WHEREFORE, premises considered, the petitions are DISMISSED. The Temporary Restraining Order issued is
LIFTED.1âwphi1 The suspensions of the petitioners are AFFIRMED, provided that the petitioner, Mayor Rodolfo Ganzon,
may not be made to serve future suspensions on account of any of the remaining administrative charges pending
against him for acts committed prior to August 11, 1988. The Secretary of Interior is ORDERED to consolidate all such
administrative cases pending against Mayor Ganzon.

The sixty-day suspension against the petitioner, Mary Ann Rivera Artieda, is AFFIRMED. No costs.

SO ORDERED.

Fernan, C.J., Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano, Gancayco, Padilla, Bidin, Griño-Aquino,
Medialdea, Regalado and Davide, Jr., JJ concur.
[G.R. No. 152774. May 27, 2004]

THE PROVINCE OF BATANGAS, represented by its Governor, HERMILANDO I. MANDANAS, petitioner, vs. HON.
ALBERTO G. ROMULO, Executive Secretary and Chairman of the Oversight Committee on Devolution; HON.
EMILIA BONCODIN, Secretary, Department of Budget and Management; HON. JOSE D. LINA, JR., Secretary,
Department of Interior and Local Government, respondents.
DECISION
CALLEJO, SR., J.:

The Province of Batangas, represented by its Governor, Hermilando I. Mandanas, filed the present petition
for certiorari, prohibition and mandamus under Rule 65 of the Rules of Court, as amended, to declare as
unconstitutional and void certain provisos contained in the General Appropriations Acts (GAA) of 1999, 2000 and 2001,
insofar as they uniformly earmarked for each corresponding year the amount of five billion pesos (P5,000,000,000.00) of
the Internal Revenue Allotment (IRA) for the Local Government Service Equalization Fund (LGSEF) and imposed
conditions for the release thereof.
Named as respondents are Executive Secretary Alberto G. Romulo, in his capacity as Chairman of the Oversight
Committee on Devolution, Secretary Emilia Boncodin of the Department of Budget and Management (DBM) and
Secretary Jose Lina of the Department of Interior and Local Government (DILG).
Background

On December 7, 1998, then President Joseph Ejercito Estrada issued Executive Order (E.O.) No. 48 entitled
ESTABLISHING A PROGRAM FOR DEVOLUTION ADJUSTMENT AND EQUALIZATION. The program was established to
facilitate the process of enhancing the capacities of local government units (LGUs) in the discharge of the functions and
services devolved to them by the National Government Agencies concerned pursuant to the Local Government
Code.[1] The Oversight Committee (referred to as the Devolution Committee in E.O. No. 48) constituted under Section
533(b) of Republic Act No. 7160 (The Local Government Code of 1991) has been tasked to formulate and issue the
appropriate rules and regulations necessary for its effective implementation.[2] Further, to address the funding shortfalls
of functions and services devolved to the LGUs and other funding requirements of the program, the Devolution
Adjustment and Equalization Fund was created.[3] For 1998, the DBM was directed to set aside an amount to be
determined by the Oversight Committee based on the devolution status appraisal surveys undertaken by the DILG.[4] The
initial fund was to be sourced from the available savings of the national government for CY 1998.[5] For 1999 and the
succeeding years, the corresponding amount required to sustain the program was to be incorporated in the annual
GAA.[6] The Oversight Committee has been authorized to issue the implementing rules and regulations governing the
equitable allocation and distribution of said fund to the LGUs.[7]
The LGSEF in the GAA of 1999

In Republic Act No. 8745, otherwise known as the GAA of 1999, the program was renamed as the LOCAL
GOVERNMENT SERVICE EQUALIZATION FUND (LGSEF). Under said appropriations law, the amount of P96,780,000,000
was allotted as the share of the LGUs in the internal revenue taxes. Item No. 1, Special Provisions, Title XXXVI A. Internal
Revenue Allotment of Rep. Act No. 8745 contained the following proviso:
... PROVIDED, That the amount of FIVE BILLION PESOS (P5,000,000,000) shall be earmarked for the Local Government
Service Equalization Fund for the funding requirements of projects and activities arising from the full and efficient
implementation of devolved functions and services of local government units pursuant to R.A. No. 7160, otherwise
known as the Local Government Code of 1991: PROVIDED, FURTHER, That such amount shall be released to the local
government units subject to the implementing rules and regulations, including such mechanisms and guidelines for the
equitable allocations and distribution of said fund among local government units subject to the guidelines that may be
prescribed by the Oversight Committee on Devolution as constituted pursuant to Book IV, Title III, Section 533(b) of R.A.
No. 7160. The Internal Revenue Allotment shall be released directly by the Department of Budget and Management to
the Local Government Units concerned.
On July 28, 1999, the Oversight Committee (with then Executive Secretary Ronaldo B. Zamora as Chairman) passed
Resolution Nos. OCD-99-003, OCD-99-005 and OCD-99-006 entitled as follows:
OCD-99-005

RESOLUTION ADOPTING THE ALLOCATION SCHEME FOR THE PhP5 BILLION CY 1999 LOCAL GOVERNMENT
SERVICE EQUALIZATION FUND (LGSEF) AND REQUESTING HIS EXCELLENCY PRESIDENT JOSEPH EJERCITO
ESTRADA TO APPROVE SAID ALLOCATION SCHEME.
OCD-99-006

RESOLUTION ADOPTING THE ALLOCATION SCHEME FOR THE PhP4.0 BILLION OF THE 1999 LOCAL
GOVERNMENT SERVICE EQUALIZATION FUND AND ITS CONCOMITANT GENERAL FRAMEWORK,
IMPLEMENTING GUIDELINES AND MECHANICS FOR ITS IMPLEMENTATION AND RELEASE, AS
PROMULGATED BY THE OVERSIGHT COMMITTEE ON DEVOLUTION.
OCD-99-003

RESOLUTION REQUESTING HIS EXCELLENCY PRESIDENT JOSEPH EJERCITO ESTRADA TO APPROVE THE
REQUEST OF THE OVERSIGHT COMMITTEE ON DEVOLUTION TO SET ASIDE TWENTY PERCENT (20%) OF THE
LOCAL GOVERNMENT SERVICE EQUALIZATION FUND (LGSEF) FOR LOCAL AFFIRMATIVE ACTION PROJECTS
AND OTHER PRIORITY INITIATIVES FOR LGUs INSTITUTIONAL AND CAPABILITY BUILDING IN ACCORDANCE
WITH THE IMPLEMENTING GUIDELINES AND MECHANICS AS PROMULGATED BY THE COMMITTEE.
These OCD resolutions were approved by then President Estrada on October 6, 1999.
Under the allocation scheme adopted pursuant to Resolution No. OCD-99-005, the five billion pesos LGSEF was to
be allocated as follows:
1. The PhP4 Billion of the LGSEF shall be allocated in accordance with the allocation scheme and implementing
guidelines and mechanics promulgated and adopted by the OCD. To wit:
a. The first PhP2 Billion of the LGSEF shall be allocated in accordance with the codal formula sharing scheme as
prescribed under the 1991 Local Government Code;

b. The second PhP2 Billion of the LGSEF shall be allocated in accordance with a modified 1992 cost of
devolution fund (CODEF) sharing scheme, as recommended by the respective leagues of provinces, cities
and municipalities to the OCD. The modified CODEF sharing formula is as follows:

Province : 40%
Cities : 20%
Municipalities : 40%

This is applied to the P2 Billion after the approved amounts granted to individual provinces, cities and
municipalities as assistance to cover decrease in 1999 IRA share due to reduction in land area have been
taken out.
2. The remaining PhP1 Billion of the LGSEF shall be earmarked to support local affirmative action projects and
other priority initiatives submitted by LGUs to the Oversight Committee on Devolution for approval in
accordance with its prescribed guidelines as promulgated and adopted by the OCD.
In Resolution No. OCD-99-003, the Oversight Committee set aside the one billion pesos or 20% of the LGSEF to
support Local Affirmative Action Projects (LAAPs) of LGUs. This remaining amount was intended to respond to the
urgent need for additional funds assistance, otherwise not available within the parameters of other existing fund
sources. For LGUs to be eligible for funding under the one-billion-peso portion of the LGSEF, the OCD promulgated the
following:
III. CRITERIA FOR ELIGIBILITY:
1. LGUs (province, city, municipality, or barangay), individually or by group or multi-LGUs or leagues of LGUs,
especially those belonging to the 5th and 6th class, may access the fund to support any projects or
activities that satisfy any of the aforecited purposes. A barangay may also access this fund directly or
through their respective municipality or city.

2. The proposed project/activity should be need-based, a local priority, with high development impact and are
congruent with the socio-cultural, economic and development agenda of the Estrada Administration,
such as food security, poverty alleviation, electrification, and peace and order, among others.

3. Eligible for funding under this fund are projects arising from, but not limited to, the following areas of
concern:

a. delivery of local health and sanitation services, hospital services and other tertiary services;
b. delivery of social welfare services;
c. provision of socio-cultural services and facilities for youth and community development;
d. provision of agricultural and on-site related research;
e. improvement of community-based forestry projects and other local projects on environment and
natural resources protection and conservation;
f. improvement of tourism facilities and promotion of tourism;
g. peace and order and public safety;
h. construction, repair and maintenance of public works and infrastructure, including public buildings
and facilities for public use, especially those destroyed or damaged by man-made or natural
calamities and disaster as well as facilities for water supply, flood control and river dikes;
i. provision of local electrification facilities;
j. livelihood and food production services, facilities and equipment;
k. other projects that may be authorized by the OCD consistent with the aforementioned objectives and
guidelines;

4. Except on extremely meritorious cases, as may be determined by the Oversight Committee on Devolution,
this portion of the LGSEF shall not be used in expenditures for personal costs or benefits under existing
laws applicable to governments.Generally, this fund shall cover the following objects of expenditures for
programs, projects and activities arising from the implementation of devolved and regular functions and
services:

a. acquisition/procurement of supplies and materials critical to the full and effective implementation of
devolved programs, projects and activities;
b. repair and/or improvement of facilities;
c. repair and/or upgrading of equipment;
d. acquisition of basic equipment;
e. construction of additional or new facilities;
f. counterpart contribution to joint arrangements or collective projects among groups of municipalities,
cities and/or provinces related to devolution and delivery of basic services.

5. To be eligible for funding, an LGU or group of LGU shall submit to the Oversight Committee on Devolution
through the Department of Interior and Local Governments, within the prescribed schedule and
timeframe, a Letter Request for Funding Support from the Affirmative Action Program under the LGSEF,
duly signed by the concerned LGU(s) and endorsed by cooperators and/or beneficiaries, as well as the
duly signed Resolution of Endorsement by the respective Sanggunian(s) of the LGUs concerned. The
LGU-proponent shall also be required to submit the Project Request (PR), using OCD Project Request
Form No. 99-02, that details the following:

(a) general description or brief of the project;


(b) objectives and justifications for undertaking the project, which should highlight the benefits to the
locality and the expected impact to the local program/project arising from the full and efficient
implementation of social services and facilities, at the local levels;
(c) target outputs or key result areas;
(d) schedule of activities and details of requirements;
(e) total cost requirement of the project;
(f) proponents counterpart funding share, if any, and identified source(s) of counterpart funds for the
full implementation of the project;
(g) requested amount of project cost to be covered by the LGSEF.

Further, under the guidelines formulated by the Oversight Committee as contained in Attachment - Resolution No.
OCD-99-003, the LGUs were required to identify the projects eligible for funding under the one-billion-peso portion of
the LGSEF and submit the project proposals thereof and other documentary requirements to the DILG for appraisal. The
project proposals that passed the DILGs appraisal would then be submitted to the Oversight Committee for review,
evaluation and approval. Upon its approval, the Oversight Committee would then serve notice to the DBM for the
preparation of the Special Allotment Release Order (SARO) and Notice of Cash Allocation (NCA) to effect the release of
funds to the said LGUs.
The LGSEF in the GAA of 2000

Under Rep. Act No. 8760, otherwise known as the GAA of 2000, the amount of P111,778,000,000 was allotted as
the share of the LGUs in the internal revenue taxes. As in the GAA of 1999, the GAA of 2000 contained a proviso
earmarking five billion pesos of the IRA for the LGSEF. This proviso, found in Item No. 1, Special Provisions, Title XXXVII
A. Internal Revenue Allotment, was similarly worded as that contained in the GAA of 1999.
The Oversight Committee, in its Resolution No. OCD-2000-023 dated June 22, 2000, adopted the following
allocation scheme governing the five billion pesos LGSEF for 2000:
1. The PhP3.5 Billion of the CY 2000 LGSEF shall be allocated to and shared by the four levels of LGUs, i.e.,
provinces, cities, municipalities, and barangays, using the following percentage-sharing formula agreed
upon and jointly endorsed by the various Leagues of LGUs:

For Provinces 26% or P 910,000,000


For Cities 23% or 805,000,000
For Municipalities 35% or 1,225,000,000
For Barangays 16% or 560,000,000
Provided that the respective Leagues representing the provinces, cities, municipalities and barangays
shall draw up and adopt the horizontal distribution/sharing schemes among the member LGUs whereby
the Leagues concerned may opt to adopt direct financial assistance or project-based arrangement, such
that the LGSEF allocation for individual LGU shall be released directly to the LGU concerned;

Provided further that the individual LGSEF shares to LGUs are used in accordance with the general
purposes and guidelines promulgated by the OCD for the implementation of the LGSEF at the local levels
pursuant to Res. No. OCD-99-006 dated October 7, 1999 and pursuant to the Leagues guidelines and
mechanism as approved by the OCD;

Provided further that each of the Leagues shall submit to the OCD for its approval their respective
allocation scheme, the list of LGUs with the corresponding LGSEF shares and the corresponding project
categories if project-based;

Provided further that upon approval by the OCD, the lists of LGUs shall be endorsed to the DBM as the
basis for the preparation of the corresponding NCAs, SAROs, and related budget/release documents.
2. The remaining P1,500,000,000 of the CY 2000 LGSEF shall be earmarked to support the following initiatives
and local affirmative action projects, to be endorsed to and approved by the Oversight Committee on
Devolution in accordance with the OCD agreements, guidelines, procedures and documentary
requirements:

On July 5, 2000, then President Estrada issued a Memorandum authorizing then Executive Secretary Zamora and
the DBM to implement and release the 2.5 billion pesos LGSEF for 2000 in accordance with Resolution No. OCD-2000-
023.
Thereafter, the Oversight Committee, now under the administration of President Gloria Macapagal-Arroyo,
promulgated Resolution No. OCD-2001-29 entitled ADOPTING RESOLUTION NO. OCD-2000-023 IN THE ALLOCATION,
IMPLEMENTATION AND RELEASE OF THE REMAINING P2.5 BILLION LGSEF FOR CY 2000. Under this resolution, the
amount of one billion pesos of the LGSEF was to be released in accordance with paragraph 1 of Resolution No. OCD-
2000-23, to complete the 3.5 billion pesos allocated to the LGUs, while the amount of 1.5 billion pesos was allocated for
the LAAP.However, out of the latter amount, P400,000,000 was to be allocated and released as follows: P50,000,000 as
financial assistance to the LAAPs of LGUs; P275,360,227 as financial assistance to cover the decrease in the IRA of LGUs
concerned due to reduction in land area; and P74,639,773 for the LGSEF Capability-Building Fund.
The LGSEF in the GAA of 2001

In view of the failure of Congress to enact the general appropriations law for 2001, the GAA of 2000 was deemed
re-enacted, together with the IRA of the LGUs therein and the proviso earmarking five billion pesos thereof for the
LGSEF.
On January 9, 2002, the Oversight Committee adopted Resolution No. OCD-2002-001 allocating the five billion
pesos LGSEF for 2001 as follows:
Modified Codal Formula P 3.000 billion
Priority Projects 1.900 billion
Capability Building Fund .100 billion
P 5.000 billion

RESOLVED FURTHER, that the P3.0 B of the CY 2001 LGSEF which is to be allocated according to the modified codal
formula shall be released to the four levels of LGUs, i.e., provinces, cities, municipalities and barangays, as follows:

LGUs Percentage Amount


Provinces 25 P 0.750 billion
Cities 25 0.750
Municipalities 35 1.050
Barangays 15 0.450
100 P 3.000 billion
RESOLVED FURTHER, that the P1.9 B earmarked for priority projects shall be distributed according to the following
criteria:

1.0 For projects of the 4th, 5th and 6th class LGUs; or

2.0 Projects in consonance with the Presidents State of the Nation Address (SONA)/summit commitments.

RESOLVED FURTHER, that the remaining P100 million LGSEF capability building fund shall be distributed in accordance
with the recommendation of the Leagues of Provinces, Cities, Municipalities and Barangays, and approved by the OCD.

Upon receipt of a copy of the above resolution, Gov. Mandanas wrote to the individual members of the Oversight
Committee seeking the reconsideration of Resolution No. OCD-2002-001. He also wrote to Pres. Macapagal-Arroyo
urging her to disapprove said resolution as it violates the Constitution and the Local Government Code of 1991.
On January 25, 2002, Pres. Macapagal-Arroyo approved Resolution No. OCD-2002-001.
The Petitioners Case

The petitioner now comes to this Court assailing as unconstitutional and void the provisos in the GAAs of 1999,
2000 and 2001, relating to the LGSEF. Similarly assailed are the Oversight Committees Resolutions Nos. OCD-99-003,
OCD-99-005, OCD-99-006, OCD-2000-023, OCD-2001-029 and OCD-2002-001 issued pursuant thereto. The petitioner
submits that the assailed provisos in the GAAs and the OCD resolutions, insofar as they earmarked the amount of five
billion pesos of the IRA of the LGUs for 1999, 2000 and 2001 for the LGSEF and imposed conditions for the release
thereof, violate the Constitution and the Local Government Code of 1991.
Section 6, Article X of the Constitution is invoked as it mandates that the just share of the LGUs shall be
automatically released to them. Sections 18 and 286 of the Local Government Code of 1991, which enjoin that the just
share of the LGUs shall be automatically and directly released to them without need of further action are, likewise, cited.
The petitioner posits that to subject the distribution and release of the five-billion-peso portion of the IRA, classified
as the LGSEF, to compliance by the LGUs with the implementing rules and regulations, including the mechanisms and
guidelines prescribed by the Oversight Committee, contravenes the explicit directive of the Constitution that the LGUs
share in the national taxes shall be automatically released to them. The petitioner maintains that the use of the word
shall must be given a compulsory meaning.
To further buttress this argument, the petitioner contends that to vest the Oversight Committee with the authority
to determine the distribution and release of the LGSEF, which is a part of the IRA of the LGUs, is an anathema to the
principle of local autonomy as embodied in the Constitution and the Local Government Code of 1991. The petitioner
cites as an example the experience in 2001 when the release of the LGSEF was long delayed because the Oversight
Committee was not able to convene that year and no guidelines were issued therefor. Further, the possible disapproval
by the Oversight Committee of the project proposals of the LGUs would result in the diminution of the latters share in
the IRA.
Another infringement alleged to be occasioned by the assailed OCD resolutions is the improper amendment to
Section 285 of the Local Government Code of 1991 on the percentage sharing of the IRA among the LGUs. Said provision
allocates the IRA as follows: Provinces 23%; Cities 23%; Municipalities 34%; and Barangays 20%. [8] This formula has been
improperly amended or modified, with respect to the five-billion-peso portion of the IRA allotted for the LGSEF, by the
assailed OCD resolutions as they invariably provided for a different sharing scheme.
The modifications allegedly constitute an illegal amendment by the executive branch of a substantive
law. Moreover, the petitioner mentions that in the Letter dated December 5, 2001 of respondent Executive Secretary
Romulo addressed to respondent Secretary Boncodin, the former endorsed to the latter the release of funds to certain
LGUs from the LGSEF in accordance with the handwritten instructions of President Arroyo. Thus, the LGUs are at a loss as
to how a portion of the LGSEF is actually allocated. Further, there are still portions of the LGSEF that, to date, have not
been received by the petitioner; hence, resulting in damage and injury to the petitioner.
The petitioner prays that the Court declare as unconstitutional and void the assailed provisos relating to the LGSEF
in the GAAs of 1999, 2000 and 2001 and the assailed OCD resolutions (Resolutions Nos. OCD-99-003, OCD-99-005, OCD-
99-006, OCD-2000-023, OCD-2001-029 and OCD-2002-001) issued by the Oversight Committee pursuant thereto. The
petitioner, likewise, prays that the Court direct the respondents to rectify the unlawful and illegal distribution and
releases of the LGSEF for the aforementioned years and release the same in accordance with the sharing formula under
Section 285 of the Local Government Code of 1991. Finally, the petitioner urges the Court to declare that the entire IRA
should be released automatically without further action by the LGUs as required by the Constitution and the Local
Government Code of 1991.
The Respondents Arguments

The respondents, through the Office of the Solicitor General, urge the Court to dismiss the petition on procedural
and substantive grounds. On the latter, the respondents contend that the assailed provisos in the GAAs of 1999, 2000
and 2001 and the assailed resolutions issued by the Oversight Committee are not constitutionally infirm. The
respondents advance the view that Section 6, Article X of the Constitution does not specify that the just share of the
LGUs shall be determined solely by the Local Government Code of 1991. Moreover, the phrase as determined by law in
the same constitutional provision means that there exists no limitation on the power of Congress to determine what is
the just share of the LGUs in the national taxes. In other words, Congress is the arbiter of what should be the just share
of the LGUs in the national taxes.
The respondents further theorize that Section 285 of the Local Government Code of 1991, which provides for the
percentage sharing of the IRA among the LGUs, was not intended to be a fixed determination of their just share in the
national taxes. Congress may enact other laws, including appropriations laws such as the GAAs of 1999, 2000 and 2001,
providing for a different sharing formula. Section 285 of the Local Government Code of 1991 was merely intended to be
the default share of the LGUs to do away with the need to determine annually by law their just share. However, the
LGUs have no vested right in a permanent or fixed percentage as Congress may increase or decrease the just share of
the LGUs in accordance with what it believes is appropriate for their operation. There is nothing in the Constitution
which prohibits Congress from making such determination through the appropriations laws. If the provisions of a
particular statute, the GAA in this case, are within the constitutional power of the legislature to enact, they should be
sustained whether the courts agree or not in the wisdom of their enactment.
On procedural grounds, the respondents urge the Court to dismiss the petition outright as the same is
defective. The petition allegedly raises factual issues which should be properly threshed out in the lower courts, not this
Court, not being a trier of facts.Specifically, the petitioners allegation that there are portions of the LGSEF that it has not,
to date, received, thereby causing it (the petitioner) injury and damage, is subject to proof and must be substantiated in
the proper venue, i.e., the lower courts.
Further, according to the respondents, the petition has already been rendered moot and academic as it no longer
presents a justiciable controversy. The IRAs for the years 1999, 2000 and 2001, have already been released and the
government is now operating under the 2003 budget. In support of this, the respondents submitted certifications issued
by officers of the DBM attesting to the release of the allocation or shares of the petitioner in the LGSEF for 1999, 2000
and 2001. There is, therefore, nothing more to prohibit.
Finally, the petitioner allegedly has no legal standing to bring the suit because it has not suffered any injury. In fact,
the petitioners just share has even increased. Pursuant to Section 285 of the Local Government Code of 1991, the share
of the provinces is 23%. OCD Nos. 99-005, 99-006 and 99-003 gave the provinces 40% of P2 billion of the LGSEF. OCD
Nos. 2000-023 and 2001-029 apportioned 26% of P3.5 billion to the provinces. On the other hand, OCD No. 2001-001
allocated 25% of P3 billion to the provinces. Thus, the petitioner has not suffered any injury in the implementation of
the assailed provisos in the GAAs of 1999, 2000 and 2001 and the OCD resolutions.
The Ruling of the Court
Procedural Issues
Before resolving the petition on its merits, the Court shall first rule on the following procedural issues raised by the
respondents: (1) whether the petitioner has legal standing or locus standi to file the present suit; (2) whether the
petition involves factual questions that are properly cognizable by the lower courts; and (3) whether the issue had been
rendered moot and academic.
The petitioner has locus standi
to maintain the present suit

The gist of the question of standing is whether a party has alleged such a personal stake in the outcome of the
controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court so
largely depends for illumination of difficult constitutional questions.[9] Accordingly, it has been held that the interest of a
party assailing the constitutionality of a statute must be direct and personal. Such party must be able to show, not only
that the law or any government act is invalid, but also that he has sustained or is in imminent danger of sustaining some
direct injury as a result of its enforcement, and not merely that he suffers thereby in some indefinite way. It must appear
that the person complaining has been or is about to be denied some right or privilege to which he is lawfully entitled or
that he is about to be subjected to some burdens or penalties by reason of the statute or act complained of.[10]
The Court holds that the petitioner possesses the requisite standing to maintain the present suit. The petitioner, a
local government unit, seeks relief in order to protect or vindicate an interest of its own, and of the other LGUs. This
interest pertains to the LGUs share in the national taxes or the IRA. The petitioners constitutional claim is, in substance,
that the assailed provisos in the GAAs of 1999, 2000 and 2001, and the OCD resolutions contravene Section 6, Article X
of the Constitution, mandating the automatic release to the LGUs of their share in the national taxes. Further, the injury
that the petitioner claims to suffer is the diminution of its share in the IRA, as provided under Section 285 of the Local
Government Code of 1991, occasioned by the implementation of the assailed measures. These allegations are sufficient
to grant the petitioner standing to question the validity of the assailed provisos in the GAAs of 1999, 2000 and 2001, and
the OCD resolutions as the petitioner clearly has a plain, direct and adequate interest in the manner and distribution of
the IRA among the LGUs.
The petition involves a significant
legal issue

The crux of the instant controversy is whether the assailed provisos contained in the GAAs of 1999, 2000 and 2001,
and the OCD resolutions infringe the Constitution and the Local Government Code of 1991. This is undoubtedly a legal
question. On the other hand, the following facts are not disputed:
1. The earmarking of five billion pesos of the IRA for the LGSEF in the assailed provisos in the GAAs of 1999,
2000 and re-enacted budget for 2001;
2. The promulgation of the assailed OCD resolutions providing for the allocation schemes covering the said five
billion pesos and the implementing rules and regulations therefor; and
3. The release of the LGSEF to the LGUs only upon their compliance with the implementing rules and
regulations, including the guidelines and mechanisms, prescribed by the Oversight Committee.
Considering that these facts, which are necessary to resolve the legal question now before this Court, are no longer
in issue, the same need not be determined by a trial court.[11] In any case, the rule on hierarchy of courts will not prevent
this Court from assuming jurisdiction over the petition. The said rule may be relaxed when the redress desired cannot be
obtained in the appropriate courts or where exceptional and compelling circumstances justify availment of a remedy
within and calling for the exercise of this Courts primary jurisdiction.[12]
The crucial legal issue submitted for resolution of this Court entails the proper legal interpretation of constitutional
and statutory provisions. Moreover, the transcendental importance of the case, as it necessarily involves the application
of the constitutional principle on local autonomy, cannot be gainsaid. The nature of the present controversy, therefore,
warrants the relaxation by this Court of procedural rules in order to resolve the case forthwith.
The substantive issue needs to be resolved
notwithstanding the supervening events

Granting arguendo that, as contended by the respondents, the resolution of the case had already been overtaken
by supervening events as the IRA, including the LGSEF, for 1999, 2000 and 2001, had already been released and the
government is now operating under a new appropriations law, still, there is compelling reason for this Court to resolve
the substantive issue raised by the instant petition. Supervening events, whether intended or accidental, cannot prevent
the Court from rendering a decision if there is a grave violation of the Constitution.[13] Even in cases where supervening
events had made the cases moot, the Court did not hesitate to resolve the legal or constitutional issues raised to
formulate controlling principles to guide the bench, bar and public.[14]
Another reason justifying the resolution by this Court of the substantive issue now before it is the rule that courts
will decide a question otherwise moot and academic if it is capable of repetition, yet evading review.[15] For the GAAs in
the coming years may contain provisos similar to those now being sought to be invalidated, and yet, the question may
not be decided before another GAA is enacted. It, thus, behooves this Court to make a categorical ruling on the
substantive issue now.
Substantive Issue
As earlier intimated, the resolution of the substantive legal issue in this case calls for the application of a most
important constitutional policy and principle, that of local autonomy.[16] In Article II of the Constitution, the State has
expressly adopted as a policy that:
Section 25. The State shall ensure the autonomy of local governments.

An entire article (Article X) of the Constitution has been devoted to guaranteeing and promoting the autonomy of
LGUs.Section 2 thereof reiterates the State policy in this wise:
Section 2. The territorial and political subdivisions shall enjoy local autonomy.

Consistent with the principle of local autonomy, the Constitution confines the Presidents power over the LGUs to
one of general supervision.[17] This provision has been interpreted to exclude the power of control. The distinction
between the two powers was enunciated in Drilon v. Lim:[18]
An officer in control lays down the rules in the doing of an act. If they are not followed, he may, in his discretion, order
the act undone or re-done by his subordinate or he may even decide to do it himself. Supervision does not cover such
authority. The supervisor or superintendent merely sees to it that the rules are followed, but he himself does not lay
down such rules, nor does he have the discretion to modify or replace them. If the rules are not observed, he may order
the work done or re-done but only to conform to the prescribed rules. He may not prescribe his own manner for doing
the act. He has no judgment on this matter except to see to it that the rules are followed.[19]

The Local Government Code of 1991[20] was enacted to flesh out the mandate of the Constitution.[21] The State
policy on local autonomy is amplified in Section 2 thereof:
Sec. 2. Declaration of Policy. (a) It is hereby declared the policy of the State that the territorial and political subdivisions
of the State shall enjoy genuine and meaningful local autonomy to enable them to attain their fullest development as
self-reliant communities and make them more effective partners in the attainment of national goals. Toward this end,
the State shall provide for a more responsive and accountable local government structure instituted through a system of
decentralization whereby local government units shall be given more powers, authority, responsibilities, and
resources. The process of decentralization shall proceed from the National Government to the local government units.

Guided by these precepts, the Court shall now determine whether the assailed provisos in the GAAs of 1999, 2000
and 2001, earmarking for each corresponding year the amount of five billion pesos of the IRA for the LGSEF and the OCD
resolutions promulgated pursuant thereto, transgress the Constitution and the Local Government Code of 1991.
The assailed provisos in the GAAs of 1999, 2000
and 2001 and the OCD resolutions violate the
constitutional precept on local autonomy

Section 6, Article X of the Constitution reads:


Sec. 6. Local government units shall have a just share, as determined by law, in the national taxes which shall
be automatically released to them.

When parsed, it would be readily seen that this provision mandates that (1) the LGUs shall have a just share in the
national taxes; (2) the just share shall be determined by law; and (3) the just share shall be automatically released to the
LGUs.
The Local Government Code of 1991, among its salient provisions, underscores the automatic release of the LGUs
just share in this wise:
Sec. 18. Power to Generate and Apply Resources. Local government units shall have the power and authority to establish
an organization that shall be responsible for the efficient and effective implementation of their development plans,
program objectives and priorities; to create their own sources of revenue and to levy taxes, fees, and charges which shall
accrue exclusively for their use and disposition and which shall be retained by them; to have a just share in national
taxes which shall be automatically and directly released to them without need of further action;
...

Sec. 286. Automatic Release of Shares. (a) The share of each local government unit shall be released, without need of
any further action, directly to the provincial, city, municipal or barangay treasurer, as the case may be, on a quarterly
basis within five (5) days after the end of each quarter, and which shall not be subject to any lien or holdback that may
be imposed by the national government for whatever purpose.

(b) Nothing in this Chapter shall be understood to diminish the share of local government units under existing laws.

Websters Third New International Dictionary defines automatic as involuntary either wholly or to a major extent so
that any activity of the will is largely negligible; of a reflex nature; without volition; mechanical; like or suggestive of an
automaton. Further, the word automatically is defined as in an automatic manner: without thought or conscious
intention. Being automatic, thus, connotes something mechanical, spontaneous and perfunctory. As such, the LGUs are
not required to perform any act to receive the just share accruing to them from the national coffers. As emphasized by
the Local Government Code of 1991, the just share of the LGUs shall be released to them without need of further
action. Construing Section 286 of the LGC, we held in Pimentel, Jr. v. Aguirre,[22] viz:
Section 4 of AO 372 cannot, however, be upheld. A basic feature of local fiscal autonomy is the automatic release of the
shares of LGUs in the National internal revenue. This is mandated by no less than the Constitution. The Local
Government Code specifies further that the release shall be made directly to the LGU concerned within five (5) days
after every quarter of the year and shall not be subject to any lien or holdback that may be imposed by the national
government for whatever purpose. As a rule, the term SHALL is a word of command that must be given a compulsory
meaning. The provision is, therefore, IMPERATIVE.

Section 4 of AO 372, however, orders the withholding, effective January 1, 1998, of 10 percent of the LGUs IRA pending
the assessment and evaluation by the Development Budget Coordinating Committee of the emerging fiscal situation in
the country. Such withholding clearly contravenes the Constitution and the law. Although temporary, it is equivalent to a
holdback, which means something held back or withheld, often temporarily. Hence, the temporary nature of the
retention by the national government does not matter. Any retention is prohibited.

In sum, while Section 1 of AO 372 may be upheld as an advisory effected in times of national crisis, Section 4 thereof has
no color of validity at all. The latter provision effectively encroaches on the fiscal autonomy of local
governments. Concededly, the President was well-intentioned in issuing his Order to withhold the LGUs IRA, but the rule
of law requires that even the best intentions must be carried out within the parameters of the Constitution and the
law. Verily, laudable purposes must be carried out by legal methods.[23]

The just share of the LGUs is incorporated as the IRA in the appropriations law or GAA enacted by Congress
annually.Under the assailed provisos in the GAAs of 1999, 2000 and 2001, a portion of the IRA in the amount of five
billion pesos was earmarked for the LGSEF, and these provisos imposed the condition that such amount shall be
released to the local government units subject to the implementing rules and regulations, including such mechanisms
and guidelines for the equitable allocations and distribution of said fund among local government units subject to the
guidelines that may be prescribed by the Oversight Committee on Devolution. Pursuant thereto, the Oversight
Committee, through the assailed OCD resolutions, apportioned the five billion pesos LGSEF such that:
For 1999

P2 billion - allocated according to Sec. 285 LGC


P2 billion - Modified Sharing Formula (Provinces 40%;
Cities 20%; Municipalities 40%)
P1 billion projects (LAAP) approved by OCD.[24]

For 2000

P3.5 billion Modified Sharing Formula (Provinces 26%;


Cities 23%; Municipalities 35%; Barangays 16%);
P1.5 billion projects (LAAP) approved by the OCD.[25]

For 2001

P3 billion Modified Sharing Formula (Provinces 25%;


Cities 25%; Municipalities 35%; Barangays 15%)
P1.9 billion priority projects
P100 million capability building fund.[26]

Significantly, the LGSEF could not be released to the LGUs without the Oversight Committees prior
approval. Further, with respect to the portion of the LGSEF allocated for various projects of the LGUs (P1 billion for
1999; P1.5 billion for 2000 and P2 billion for 2001), the Oversight Committee, through the assailed OCD resolutions, laid
down guidelines and mechanisms that the LGUs had to comply with before they could avail of funds from this portion of
the LGSEF. The guidelines required (a) the LGUs to identify the projects eligible for funding based on the criteria laid
down by the Oversight Committee; (b) the LGUs to submit their project proposals to the DILG for appraisal; (c) the
project proposals that passed the appraisal of the DILG to be submitted to the Oversight Committee for review,
evaluation and approval. It was only upon approval thereof that the Oversight Committee would direct the DBM to
release the funds for the projects.
To the Courts mind, the entire process involving the distribution and release of the LGSEF is constitutionally
impermissible. The LGSEF is part of the IRA or just share of the LGUs in the national taxes. To subject its distribution and
release to the vagaries of the implementing rules and regulations, including the guidelines and mechanisms unilaterally
prescribed by the Oversight Committee from time to time, as sanctioned by the assailed provisos in the GAAs of 1999,
2000 and 2001 and the OCD resolutions, makes the release not automatic, a flagrant violation of the constitutional and
statutory mandate that the just share of the LGUs shall be automatically released to them. The LGUs are, thus, placed at
the mercy of the Oversight Committee.
Where the law, the Constitution in this case, is clear and unambiguous, it must be taken to mean exactly what it
says, and courts have no choice but to see to it that the mandate is obeyed.[27] Moreover, as correctly posited by the
petitioner, the use of the word shall connotes a mandatory order. Its use in a statute denotes an imperative obligation
and is inconsistent with the idea of discretion.[28]
Indeed, the Oversight Committee exercising discretion, even control, over the distribution and release of a portion
of the IRA, the LGSEF, is an anathema to and subversive of the principle of local autonomy as embodied in the
Constitution. Moreover, it finds no statutory basis at all as the Oversight Committee was created merely to formulate
the rules and regulations for the efficient and effective implementation of the Local Government Code of 1991 to ensure
compliance with the principles of local autonomy as defined under the Constitution.[29] In fact, its creation was placed
under the title of Transitory Provisions, signifying its ad hoc character. According to Senator Aquilino Q. Pimentel, the
principal author and sponsor of the bill that eventually became Rep. Act No. 7160, the Committees work was supposed
to be done a year from the approval of the Code, or on October 10, 1992.[30] The Oversight Committees authority is
undoubtedly limited to the implementation of the Local Government Code of 1991, not to supplant or subvert the
same. Neither can it exercise control over the IRA, or even a portion thereof, of the LGUs.
That the automatic release of the IRA was precisely intended to guarantee and promote local autonomy can be
gleaned from the discussion below between Messrs. Jose N. Nolledo and Regalado M. Maambong, then members of the
1986 Constitutional Commission, to wit:
MR. MAAMBONG. Unfortunately, under Section 198 of the Local Government Code, the existence of subprovinces is still
acknowledged by the law, but the statement of the Gentleman on this point will have to be taken up probably by the
Committee on Legislation. A second point, Mr. Presiding Officer, is that under Article 2, Section 10 of the 1973
Constitution, we have a provision which states:

The State shall guarantee and promote the autonomy of local government units, especially the barrio, to
insure their fullest development as self-reliant communities.
This provision no longer appears in the present configuration; does this mean that the concept of giving local
autonomy to local governments is no longer adopted as far as this Article is concerned?

MR. NOLLEDO. No. In the report of the Committee on Preamble, National Territory, and Declaration of Principles, that
concept is included and widened upon the initiative of Commissioner Bennagen.

MR. MAAMBONG. Thank you for that.

With regard to Section 6, sources of revenue, the creation of sources as provided by previous law was subject to
limitations as may be provided by law, but now, we are using the term subject to such guidelines as may be fixed by
law. In Section 7, mention is made about the unique, distinct and exclusive charges and contributions, and in Section 8,
we talk about exclusivity of local taxes and the share in the national wealth. Incidentally, I was one of the authors of this
provision, and I am very thankful. Does this indicate local autonomy, or was the wording of the law changed to give
more autonomy to the local government units?[31]

MR. NOLLEDO. Yes. In effect, those words indicate also decentralization because local political units can collect taxes,
fees and charges subject merely to guidelines, as recommended by the league of governors and city mayors, with whom
I had a dialogue for almost two hours.They told me that limitations may be questionable in the sense that Congress may
limit and in effect deny the right later on.

MR. MAAMBONG. Also, this provision on automatic release of national tax share points to more local autonomy. Is this
the intention?

MR. NOLLEDO. Yes, the Commissioner is perfectly right.[32]

The concept of local autonomy was explained in Ganzon v. Court of Appeals[33] in this wise:
As the Constitution itself declares, local autonomy means a more responsive and accountable local government
structure instituted through a system of decentralization. The Constitution, as we observed, does nothing more than to
break up the monopoly of the national government over the affairs of local governments and as put by political
adherents, to liberate the local governments from the imperialism of Manila.Autonomy, however, is not meant to end
the relation of partnership and interdependence between the central administration and local government units, or
otherwise, to usher in a regime of federalism. The Charter has not taken such a radical step. Local governments, under
the Constitution, are subject to regulation, however limited, and for no other purpose than precisely, albeit
paradoxically, to enhance self-government.

As we observed in one case, decentralization means devolution of national administration but not power to the local
levels. Thus:

Now, autonomy is either decentralization of administration or decentralization of power. There is decentralization of


administration when the central government delegates administrative powers to political subdivisions in order to
broaden the base of government power and in the process to make local governments more responsive and
accountable and ensure their fullest development as self-reliant communities and make them more effective partners in
the pursuit of national development and social progress. At the same time, it relieves the central government of the
burden of managing local affairs and enables it to concentrate on national concerns. The President exercises general
supervision over them, but only to ensure that local affairs are administered according to law. He has no control over
their acts in the sense that he can substitute their judgments with his own.

Decentralization of power, on the other hand, involves an abdication of political power in the [sic] favor of local
governments [sic] units declared to be autonomous. In that case, the autonomous government is free to chart its own
destiny and shape its future with minimum intervention from central authorities. According to a constitutional author,
decentralization of power amounts to self-immolation, since in that event, the autonomous government becomes
accountable not to the central authorities but to its constituency.[34]
Local autonomy includes both administrative and fiscal autonomy. The fairly recent case of Pimentel v. Aguirre[35] is
particularly instructive. The Court declared therein that local fiscal autonomy includes the power of the LGUs to, inter
alia, allocate their resources in accordance with their own priorities:
Under existing law, local government units, in addition to having administrative autonomy in the exercise of their
functions, enjoy fiscal autonomy as well. Fiscal autonomy means that local governments have the power to create their
own sources of revenue in addition to their equitable share in the national taxes released by the national government,
as well as the power to allocate their resources in accordance with their own priorities. It extends to the preparation of
their budgets, and local officials in turn have to work within the constraints thereof. They are not formulated at the
national level and imposed on local governments, whether they are relevant to local needs and resources or not ...[36]

Further, a basic feature of local fiscal autonomy is the constitutionally mandated automatic release of the shares of
LGUs in the national internal revenue.[37]
Following this ratiocination, the Court in Pimentel struck down as unconstitutional Section 4 of Administrative
Order (A.O.) No. 372 which ordered the withholding, effective January 1, 1998, of ten percent of the LGUs IRA pending
the assessment and evaluation by the Development Budget Coordinating Committee of the emerging fiscal situation.
In like manner, the assailed provisos in the GAAs of 1999, 2000 and 2001, and the OCD resolutions constitute a
withholding of a portion of the IRA. They put on hold the distribution and release of the five billion pesos LGSEF and
subject the same to the implementing rules and regulations, including the guidelines and mechanisms prescribed by the
Oversight Committee from time to time. Like Section 4 of A.O. 372, the assailed provisos in the GAAs of 1999, 2000 and
2001 and the OCD resolutions effectively encroach on the fiscal autonomy enjoyed by the LGUs and must be struck
down. They cannot, therefore, be upheld.
The assailed provisos in the GAAs of 1999, 2000
and 2001 and the OCD resolutions cannot amend
Section 285 of the Local Government Code of 1991

Section 284[38] of the Local Government Code provides that, beginning the third year of its effectivity, the LGUs
share in the national internal revenue taxes shall be 40%. This percentage is fixed and may not be reduced except in the
event the national government incurs an unmanageable public sector deficit" and only upon compliance with stringent
requirements set forth in the same section:
Sec. 284. ...

Provided, That in the event that the national government incurs an unmanageable public sector deficit, the President of
the Philippines is hereby authorized, upon recommendation of Secretary of Finance, Secretary of Interior and Local
Government and Secretary of Budget and Management, and subject to consultation with the presiding officers of both
Houses of Congress and the presidents of the liga, to make the necessary adjustments in the internal revenue allotment
of local government units but in no case shall the allotment be less than thirty percent (30%) of the collection of the
national internal revenue taxes of the third fiscal year preceding the current fiscal year; Provided, further That in the first
year of the effectivity of this Code, the local government units shall, in addition to the thirty percent (30%) internal
revenue allotment which shall include the cost of devolved functions for essential public services, be entitled to receive
the amount equivalent to the cost of devolved personnel services.

Thus, from the above provision, the only possible exception to the mandatory automatic release of the LGUs IRA is
if the national internal revenue collections for the current fiscal year is less than 40 percent of the collections of the
preceding third fiscal year, in which case what should be automatically released shall be a proportionate amount of the
collections for the current fiscal year. The adjustment may even be made on a quarterly basis depending on the actual
collections of national internal revenue taxes for the quarter of the current fiscal year. In the instant case, however,
there is no allegation that the national internal revenue tax collections for the fiscal years 1999, 2000 and 2001 have
fallen compared to the preceding three fiscal years.
Section 285 then specifies how the IRA shall be allocated among the LGUs:
Sec. 285. Allocation to Local Government Units. The share of local government units in the internal revenue allotment
shall be allocated in the following manner:

(a) Provinces Twenty-three (23%)


(b) Cities Twenty-three percent (23%);
(c) Municipalities Thirty-four (34%); and
(d) Barangays Twenty percent (20%).

However, this percentage sharing is not followed with respect to the five billion pesos LGSEF as the assailed OCD
resolutions, implementing the assailed provisos in the GAAs of 1999, 2000 and 2001, provided for a different sharing
scheme.For example, for 1999, P2 billion of the LGSEF was allocated as follows: Provinces 40%; Cities 20%;
Municipalities 40%.[39] For 2000, P3.5 billion of the LGSEF was allocated in this manner: Provinces 26%; Cities 23%;
Municipalities 35%; Barangays 26%.[40] For 2001, P3 billion of the LGSEF was allocated, thus: Provinces 25%; Cities 25%;
Municipalities 35%; Barangays 15%.[41]
The respondents argue that this modification is allowed since the Constitution does not specify that the just share
of the LGUs shall only be determined by the Local Government Code of 1991. That it is within the power of Congress to
enact other laws, including the GAAs, to increase or decrease the just share of the LGUs. This contention is
untenable. The Local Government Code of 1991 is a substantive law. And while it is conceded that Congress may amend
any of the provisions therein, it may not do so through appropriations laws or GAAs. Any amendment to the Local
Government Code of 1991 should be done in a separate law, not in the appropriations law, because Congress cannot
include in a general appropriation bill matters that should be more properly enacted in a separate legislation.[42]
A general appropriations bill is a special type of legislation, whose content is limited to specified sums of money
dedicated to a specific purpose or a separate fiscal unit.[43] Any provision therein which is intended to amend another
law is considered an inappropriate provision. The category of inappropriate provisions includes unconstitutional
provisions and provisions which are intended to amend other laws, because clearly these kinds of laws have no place in
an appropriations bill.[44]
Increasing or decreasing the IRA of the LGUs or modifying their percentage sharing therein, which are fixed in the
Local Government Code of 1991, are matters of general and substantive law. To permit Congress to undertake these
amendments through the GAAs, as the respondents contend, would be to give Congress the unbridled authority to
unduly infringe the fiscal autonomy of the LGUs, and thus put the same in jeopardy every year. This, the Court cannot
sanction.
It is relevant to point out at this juncture that, unlike those of 1999, 2000 and 2001, the GAAs of 2002 and 2003 do
not contain provisos similar to the herein assailed provisos. In other words, the GAAs of 2002 and 2003 have not
earmarked any amount of the IRA for the LGSEF. Congress had perhaps seen fit to discontinue the practice as it
recognizes its infirmity.Nonetheless, as earlier mentioned, this Court has deemed it necessary to make a definitive ruling
on the matter in order to prevent its recurrence in future appropriations laws and that the principles enunciated herein
would serve to guide the bench, bar and public.
Conclusion

In closing, it is well to note that the principle of local autonomy, while concededly expounded in greater detail in
the present Constitution, dates back to the turn of the century when President William McKinley, in his Instructions to
the Second Philippine Commission dated April 7, 1900, ordered the new Government to devote their attention in the
first instance to the establishment of municipal governments in which the natives of the Islands, both in the cities and in
the rural communities, shall be afforded the opportunity to manage their own affairs to the fullest extent of which they
are capable, and subject to the least degree of supervision and control in which a careful study of their capacities and
observation of the workings of native control show to be consistent with the maintenance of law, order and
loyalty.[45] While the 1935 Constitution had no specific article on local autonomy, nonetheless, it limited the executive
power over local governments to general supervision ... as may be provided by law.[46] Subsequently, the 1973
Constitution explicitly stated that [t]he State shall guarantee and promote the autonomy of local government units,
especially the barangay to ensure their fullest development as self-reliant communities.[47] An entire article on Local
Government was incorporated therein. The present Constitution, as earlier opined, has broadened the principle of local
autonomy. The 14 sections in Article X thereof markedly increased the powers of the local governments in order to
accomplish the goal of a more meaningful local autonomy.
Indeed, the value of local governments as institutions of democracy is measured by the degree of autonomy that
they enjoy.[48] As eloquently put by M. De Tocqueville, a distinguished French political writer, [l]ocal assemblies of
citizens constitute the strength of free nations. Township meetings are to liberty what primary schools are to science;
they bring it within the peoples reach; they teach men how to use and enjoy it. A nation may establish a system of free
governments but without the spirit of municipal institutions, it cannot have the spirit of liberty.[49]
Our national officials should not only comply with the constitutional provisions on local autonomy but should also
appreciate the spirit and liberty upon which these provisions are based.[50]
WHEREFORE, the petition is GRANTED. The assailed provisos in the General Appropriations Acts of 1999, 2000 and
2001, and the assailed OCD Resolutions, are declared UNCONSTITUTIONAL.
SO ORDERED.
Vitug, (Acting Chief Justice), Panganiban, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Carpio, Austria-
Martinez, Corona, Carpio-Morales, Azcuna, and Tinga, JJ., concur.
Davide, Jr., C.J., and Puno, J., on official leave.
G.R. No. 102782 December 11, 1991
THE SOLICITOR GENERAL, RODOLFO A. MALAPIRA, STEPHEN A. MONSANTO, DAN R. CALDERON, and GRANDY N.
TRIESTE, petitioners
vs.
THE METROPOLITAN MANILA AUTHORITY and the MUNICIPALITY OF MANDALUYONG, respondents.

CRUZ, J.:

In Metropolitan Traffic Command, West Traffic District vs. Hon. Arsenio M. Gonong, G.R. No. 91023, promulgated on July
13, 1990, 1 the Court held that the confiscation of the license plates of motor vehicles for traffic violations was not
among the sanctions that could be imposed by the Metro Manila Commission under PD 1605 and was permitted only
under the conditions laid dowm by LOI 43 in the case of stalled vehicles obstructing the public streets. It was there also
observed that even the confiscation of driver's licenses for traffic violations was not directly prescribed by the decree
nor was it allowed by the decree to be imposed by the Commission. No motion for reconsideration of that decision was
submitted. The judgment became final and executory on August 6, 1990, and it was duly entered in the Book of Entries
of Judgments on July 13, 1990.

Subsequently, the following developments transpired:

In a letter dated October 17, 1990, Rodolfo A. Malapira complained to the Court that when he was stopped for an
alleged traffic violation, his driver's license was confiscated by Traffic Enforcer Angel de los Reyes in Quezon City.

On December 18,1990, the Caloocan-Manila Drivers and Operators Association sent a letter to the Court asking who
should enforce the decision in the above-mentioned case, whether they could seek damages for confiscation of their
driver's licenses, and where they should file their complaints.

Another letter was received by the Court on February 14, 1991, from Stephen L. Monsanto, complaining against the
confiscation of his driver's license by Traffic Enforcer A.D. Martinez for an alleged traffic violation in Mandaluyong.

This was followed by a letter-complaint filed on March 7, 1991, from Dan R. Calderon, a lawyer, also for confiscation of
his driver's license by Pat. R.J. Tano-an of the Makati Police Force.

Still another complaint was received by the Court dated April 29, 1991, this time from Grandy N. Trieste, another lawyer,
who also protested the removal of his front license plate by E. Ramos of the Metropolitan Manila Authority-Traffic
Operations Center and the confiscation of his driver's license by Pat. A.V. Emmanuel of the Metropolitan Police
Command-Western Police District.

Required to submit a Comment on the complaint against him, Allan D. Martinez invoked Ordinance No. 7, Series of 1988,
of Mandaluyong, authorizing the confiscation of driver's licenses and the removal of license plates of motor vehicles for
traffic violations.

For his part, A.V. Emmanuel said he confiscated Trieste's driver's license pursuant to a memorandum dated February 27,
1991, from the District Commander of the Western Traffic District of the Philippine National Police, authorizing such
sanction under certain conditions.

Director General Cesar P. Nazareno of the Philippine National Police assured the Court in his own Comment that his
office had never authorized the removal of the license plates of illegally parked vehicles and that he had in fact directed
full compliance with the above-mentioned decision in a memorandum, copy of which he attached, entitled Removal of
Motor Vehicle License Plates and dated February 28, 1991.

Pat. R.J. Tano-an, on the other hand, argued that the Gonong decision prohibited only the removal of license plates and
not the confiscation of driver's licenses.
On May 24, 1990, the Metropolitan Manila Authority issued Ordinance No. 11, Series of 1991, authorizing itself "to
detach the license plate/tow and impound attended/ unattended/ abandoned motor vehicles illegally parked or
obstructing the flow of traffic in Metro Manila."

On July 2, 1991, the Court issued the following resolution:

The attention ofthe Court has been called to the enactment by the Metropolitan Manila Authority of Ordinance
No. 11, Series of 1991, providing inter alia that:

Section 2. Authority to Detach Plate/Tow and Impound. The Metropolitan Manila Authority, thru the
Traffic Operatiom Center, is authorized to detach the license plate/tow and impound
attended/unattended/abandoned motor vehicles illegally parked or obstructing the flow of traffic in
Metro Manila.

The provision appears to be in conflict with the decision of the Court in the case at bar (as reported in 187 SCRA
432), where it was held that the license plates of motor vehicles may not be detached except only under the
conditions prescribed in LOI 43. Additionally, the Court has received several complaints against the confiscation
by police authorities of driver's licenses for alleged traffic violations, which sanction is, according to the said
decision, not among those that may be imposed under PD 1605.

To clarify these matters for the proper guidance of law-enforcement officers and motorists, the Court resolved
to require the Metropolitan Manila Authority and the Solicitor General to submit, within ten (10) days from
notice hereof, separate COMMENTS on such sanctions in light of the said decision.

In its Comment, the Metropolitan Manila Authority defended the said ordinance on the ground that it was adopted
pursuant to the powers conferred upon it by EO 392. It particularly cited Section 2 thereof vesting in the Council (its
governing body) the responsibility among others of:

1. Formulation of policies on the delivery of basic services requiring coordination or consolidation for the
Authority; and

2. Promulgation of resolutions and other issuances of metropolitan wide application, approval of a code of basic
services requiring coordination, and exercise of its rule-making powers. (Emphasis supplied)

The Authority argued that there was no conflict between the decision and the ordinance because the latter was meant
to supplement and not supplant the latter. It stressed that the decision itself said that the confiscation of license plates
was invalid in the absence of a valid law or ordinance, which was why Ordinance No. 11 was enacted. The Authority also
pointed out that the ordinance could not be attacked collaterally but only in a direct action challenging its validity.

For his part, the Solicitor General expressed the view that the ordinance was null and void because it represented an
invalid exercise of a delegated legislative power. The flaw in the measure was that it violated existing law, specifically PD
1605, which does not permit, and so impliedly prohibits, the removal of license plates and the confiscation of driver's
licenses for traffic violations in Metropolitan Manila. He made no mention, however, of the alleged impropriety of
examining the said ordinance in the absence of a formal challenge to its validity.

On October 24, 1991, the Office of the Solicitor General submitted a motion for the early resolution of the questioned
sanctions, to remove once and for all the uncertainty of their vahdity. A similar motion was filed by the Metropolitan
Manila Authority, which reiterated its contention that the incidents in question should be dismissed because there was
no actual case or controversy before the Court.

The Metropolitan Manila Authority is correct in invoking the doctrine that the validity of a law or act can be challenged
only in a direct action and not collaterally. That is indeed the settled principle. However, that rule is not inflexible and
may be relaxed by the Court under exceptional circumstances, such as those in the present controversy.
The Solicitor General notes that the practices complained of have created a great deal of confusion among motorists
about the state of the law on the questioned sanctions. More importantly, he maintains that these sanctions are illegal,
being violative of law and the Gonong decision, and should therefore be stopped. We also note the disturbing report
that one policeman who confiscated a driver's license dismissed the Gonong decision as "wrong" and said the police
would not stop their "habit" unless they received orders "from the top." Regrettably, not one of the complainants has
filed a formal challenge to the ordinances, including Monsanto and Trieste, who are lawyers and could have been more
assertive of their rights.

Given these considerations, the Court feels it must address the problem squarely presented to it and decide it as
categorically rather than dismiss the complaints on the basis of the technical objection raised and thus, through its
inaction, allow them to fester.

The step we now take is not without legal authority or judicial precedent. Unquestionably, the Court has the power to
suspend procedural rules in the exercise of its inherent power, as expressly recognized in the Constitution, to
promulgate rules concerning "pleading, practice and procedure in all courts." 2 In proper cases, procedural rules may be
relaxed or suspended in the interest of substantial justice, which otherwise may be miscarried because of a rigid and
formalistic adherence to such rules.

The Court has taken this step in a number of such cases, notably Araneta vs. Dinglasan, 3 where Justice Tuason justified
the deviation on the ground that "the transcendental importance to the public of these cases demands that they be
settled promptly and definitely, brushing aside, if we must, technicalities of procedure."

We have made similar rulings in other cases, thus:

Be it remembered that rules of procedure are but mere tools designed to facilitate the attainment ofjustice.
Their strict and rigid application, which would result in technicalities that tend to frustrate rather than promote
substantial justice, must always be avoided. (Aznar III vs. Bernad, G.R. No. 81190, May 9, 1988, 161 SCRA 276.)
Time and again, this Court has suspended its own rules and excepted a particular case from their operation
whenever the higher interests of justice so require. In the instant petition, we forego a lengthy disquisition of
the proper procedure that should have been taken by the parties involved and proceed directly to the merits of
the case. (Piczon vs. Court of Appeals, 190 SCRA 31).

Three of the cases were consolidated for argument and the other two were argued separately on other dates.
Inasmuch as all of them present the same fundamental question which, in our view, is decisive, they will be
disposed of jointly. For the same reason we will pass up the objection to the personality or sufficiency of interest
of the petitioners in case G.R. No. L-3054 and case G.R. No. L-3056 and the question whether prohibition lies in
cases G.R. Nos. L-2044 and L2756. No practical benefit can be gained from a discussion of these procedural
matters, since the decision in the cases wherein the petitioners'cause of action or the propriety of the procedure
followed is not in dispute, will be controlling authority on the others. Above all, the transcendental importance
to the public of these cases demands that they be settled promptly and definitely, brushing aside, if we must,
technicalities of procedure. (Avelino vs. Cuenco, G.R. No. L-2821 cited in Araneta vs. Dinglasan, 84 Phil. 368.)

Accordingly, the Court will consider the motion to resolve filed by the Solicitor General a petition for prohibition against
the enforcement of Ordinance No. 11, Series of 1991, of the Metropohtan Manila Authority, and Ordinance No. 7, Series
of 1988, of the Municipality of Mandaluyong. Stephen A. Monsanto, Rodolfo A. Malapira, Dan R. Calderon, and Grandy
N. Trieste are considered co-petitioners and the Metropolitan Manila Authority and the Municipality of Mandaluyong
are hereby impleaded as respondents. This petition is docketed as G.R. No. 102782. The comments already submitted
are duly noted and shall be taken into account by the Court in the resolution of the substantive issues raised.

It is stressed that this action is not intended to disparage procedural rules, which the Court has recognized often enough
as necessary to the orderly administration of justice. If we are relaxing them in this particular case, it is because of the
failure of the proper parties to file the appropriate proceeding against the acts complained of, and the necessity of
resolving, in the interest of the public, the important substantive issues raised.
Now to the merits.

The Metro Manila Authority sustains Ordinance No. 11, Series of 1991, under the specific authority conferred upon it by
EO 392, while Ordinance No. 7, Series of 1988, is justified on the basis of the General Welfare Clause embodied in the
Local Government Code. 4 It is not disputed that both measures were enacted to promote the comfort and convenience
of the public and to alleviate the worsening traffic problems in Metropolitan Manila due in large part to violations of
traffic rules.

The Court holds that there is a valid delegation of legislative power to promulgate such measures, it appearing that the
requisites of such delegation are present. These requisites are. 1) the completeness of the statute making the
delegation; and 2) the presence of a sufficient standard. 5

Under the first requirement, the statute must leave the legislature complete in all its terms and provisions such that all
the delegate will have to do when the statute reaches it is to implement it. What only can be delegated is not the
discretion to determine what the law shall be but the discretion to determine how the law shall be enforced. This has
been done in the case at bar.

As a second requirement, the enforcement may be effected only in accordance with a sufficient standard, the function
of which is to map out the boundaries of the delegate's authority and thus "prevent the delegation from running riot."
This requirement has also been met. It is settled that the "convenience and welfare" of the public, particularly the
motorists and passengers in the case at bar, is an acceptable sufficient standard to delimit the delegate's authority. 6

But the problem before us is not the validity of the delegation of legislative power. The question we must resolve is the
validity of the exercise of such delegated power.
The measures in question are enactments of local governments acting only as agents of the national legislature.
Necessarily, the acts of these agents must reflect and conform to the will of their principal. To test the validity of such
acts in the specific case now before us, we apply the particular requisites of a valid ordinance as laid down by the
accepted principles governing municipal corporations.

According to Elliot, a municipal ordinance, to be valid: 1) must not contravene the Constitution or any statute; 2) must
not be unfair or oppressive; 3) must not be partial or discriminatory; 4) must not prohibit but may regulate trade; 5)
must not be unreasonable; and 6) must be general and consistent with public policy. 7

A careful study of the Gonong decision will show that the measures under consideration do not pass the first criterion
because they do not conform to existing law. The pertinent law is PD 1605. PD 1605 does not allow either the removal of
license plates or the confiscation of driver's licenses for traffic violations committed in Metropolitan Manila. There is
nothing in the following provisions of the decree authorizing the Metropolitan Manila Commission (and now the
Metropolitan Manila Authority) to impose such sanctions:
Section 1. The Metropolitan Manila Commission shall have the power to impose fines and otherwise discipline drivers
and operators of motor vehicles for violations of traffic laws, ordinances, rules and regulations in Metropolitan Manila in
such amounts and under such penalties as are herein prescribed. For this purpose, the powers of the Land
Transportation Commission and the Board of Transportation under existing laws over such violations and punishment
thereof are hereby transferred to the Metropolitan Manila Commission. When the proper penalty to be imposed
is suspension or revocation of driver's license or certificate of public convenience, the Metropolitan Manila Commission
or its representatives shall suspend or revoke such license or certificate. The suspended or revoked driver's license or
the report of suspension or revocation of the certificate of public convenience shall be sent to the Land Transportation
Commission or the Board of Transportation, as the case may be, for their records update.
xxx xxx xxx
Section 3.` Violations of traffic laws, ordinances, rules and regulations, committed within a twelve-month period,
reckoned from the date of birth of the licensee, shall subject the violator to graduated fines as follows: P10.00 for the
first offense, P20.00 for the and offense, P50.00 for the third offense, a one-year suspension of driver's license for the
fourth offense, and a revocation of the driver's license for the fifth offense: Provided, That the Metropolitan Manila
Commission may impose higher penalties as it may deem proper for violations of its ordinances prohibiting or regulating
the use of certain public roads, streets and thoroughfares in Metropolitan Manila.
xxx xxx xxx
Section 5. In case of traffic violations, the driver's license shall not be confiscated but the erring driver shall be
immediately issued a traffic citation ticket prescribed by the Metropolitan Manila Commission which shall state the
violation committed, the amount of fine imposed for the violation and an advice that he can make payment to the city
or municipal treasurer where the violation was committed or to the Philippine National Bank or Philippine Veterans
Bank or their branches within seven days from the date of issuance of the citation ticket.
If the offender fails to pay the fine imposed within the period herein prescribed, the Metropolitan Manila Commission or
the law-enforcement agency concerned shall endorse the case to the proper fiscal for appropriate proceedings
preparatory to the filing of the case with the competent traffic court, city or municipal court.
If at the time a driver renews his driver's license and records show that he has an unpaid fine, his driver's license shall
not be renewed until he has paid the fine and corresponding surcharges.
xxx xxx xxx
Section 8. Insofar as the Metropolitan Manila area is concerned, all laws, decrees, orders, ordinances, rules and
regulations, or parts thereof inconsistent herewith are hereby repealed or modified accordingly. (Emphasis supplied).
In fact, the above provisions prohibit the imposition of such sanctions in Metropolitan Manila. The Commission was
allowed to "impose fines and otherwise discipline" traffic violators only "in such amounts and under such penalties as
are herein prescribed," that is, by the decree itself. Nowhere is the removal of license plates directly imposed by the
decree or at least allowed by it to be imposed by the Commission. Notably, Section 5 thereof expressly provides that "in
case of traffic violations, the driver's license shall not be confiscated." These restrictions are applicable to the
Metropolitan Manila Authority and all other local political subdivisions comprising Metropolitan Manila, including the
Municipality of Mandaluyong.

The requirement that the municipal enactment must not violate existing law explains itself. Local political subdivisions
are able to legislate only by virtue of a valid delegation of legislative power from the national legislature (except only
that the power to create their own sources of revenue and to levy taxes is conferred by the Constitution itself). 8 They
are mere agents vested with what is called the power of subordinate legislation. As delegates of the Congress, the local
government unit cannot contravene but must obey at all times the will of their principal. In the case before us, the
enactments in question, which are merely local in origin, cannot prevail against the decree, which has the force and
effect of a statute.
The self-serving language of Section 2 of the challenged ordinance is worth noting. Curiously, it is the measure itself,
which was enacted by the Metropolitan Manila Authority, that authorizes the Metropolitan Manila Authority to impose
the questioned sanction.

In Villacorta vs, Bemardo, 9 the Court nullified an ordinance enacted by the Municipal Board of Dagupan City for being
violative of the Land Registration Act. The decision held in part:

In declaring the said ordinance null and void, the court a quo declared:

From the above-recited requirements, there is no showing that would justify the enactment of the
questioned ordinance. Section 1 of said ordinance clearly conflicts with Section 44 of Act 496, because
the latter law does not require subdivision plans to be submitted to the City Engineer before the same is
submitted for approval to and verification by the General Land Registration Office or by the Director of
Lands as provided for in Section 58 of said Act. Section 2 of the same ordinance also contravenes the
provisions of Section 44 of Act 496, the latter being silent on a service fee of P0.03 per square meter of
every lot subject of such subdivision application; Section 3 of the ordinance in question also conflicts
with Section 44 of Act 496, because the latter law does not mention of a certification to be made by the
City Engineer before the Register of Deeds allows registration of the subdivision plan; and the last
section of said ordinance impose a penalty for its violation, which Section 44 of Act 496 does not
impose. In other words, Ordinance 22 of the City of Dagupan imposes upon a subdivision owner
additional conditions.

xxx xxx xxx

The Court takes note of the laudable purpose of the ordinance in bringing to a halt the surreptitious
registration of lands belonging to the government. But as already intimated above, the powers of the
board in enacting such a laudable ordinance cannot be held valid when it shall impede the exercise of
rights granted in a general law and/or make a general law subordinated to a local ordinance.

We affirm.

To sustain the ordinance would be to open the floodgates to other ordinances amending and so violating
national laws in the guise of implementing them. Thus, ordinances could be passed imposing additional
requirements for the issuance of marriage licenses, to prevent bigamy; the registration of vehicles, to minimize
carnapping; the execution of contracts, to forestall fraud; the validation of parts, to deter imposture; the
exercise of freedom of speech, to reduce disorder; and so on. The list is endless, but the means, even if the end
be valid, would be ultra vires.

The measures in question do not merely add to the requirement of PD 1605 but, worse, impose sanctions the decree
does not allow and in fact actually prohibits. In so doing, the ordinances disregard and violate and in effect partially
repeal the law.

We here emphasize the ruling in the Gonong case that PD 1605 applies only to the Metropolitan Manila area. It is an
exception to the general authority conferred by R.A. No. 413 on the Commissioner of Land Transportation to punish
violations of traffic rules elsewhere in the country with the sanction therein prescribed, including those here questioned.

The Court agrees that the challenged ordinances were enacted with the best of motives and shares the concern of the
rest of the public for the effective reduction of traffic problems in Metropolitan Manila through the imposition and
enforcement of more deterrent penalties upon traffic violators. At the same time, it must also reiterate the public
misgivings over the abuses that may attend the enforcement of such sanction in eluding the illicit practices described in
detail in the Gonong decision. At any rate, the fact is that there is no statutory authority for — and indeed there is a
statutory prohibition against — the imposition of such penalties in the Metropolitan Manila area. Hence, regardless of
their merits, they cannot be impose by the challenged enactments by virtue only of the delegated legislative powers.

It is for Congress to determine, in the exercise of its own discretion, whether or not to impose such sanctions, either
directly through a statute or by simply delegating authority to this effect to the local governments in Metropolitan
Manila. Without such action, PD 1605 remains effective and continues prohibit the confiscation of license plates of
motor vehicles (except under the conditions prescribed in LOI 43) and of driver licenses as well for traffic violations in
Metropolitan Manila.

WHEREFORE, judgment is hereby rendered:


(1) declaring Ordinance No.11, Seriesof l991,of theMetropolitan Manila Authority and Ordinance No. 7, Series of 1988 of
the Municipality of Mandaluyong, NULL and VOID; and
(2) enjoining all law enforcement authorities in Metropolitan Manila from removing the license plates of motor vehicles
(except when authorized under LOI 43) and confiscating driver licenses for traffic violations within the said area.
SO ORDERED.
Narvasa, C.J., Melencio-Herrera, Gutierrez, Jr., Paras, Feliciano, Padilla, Bidin, Griño-Aquino, Medialdea, Regalado,
Davide, Jr. and Romero, JJ., concur.
Nocon, J., took no part.
[G.R. No. 132988. July 19, 2000]
AQUILINO Q. PIMENTEL JR., petitioner, vs. Hon. ALEXANDER AGUIRRE in his capacity as Executive Secretary, Hon.
EMILIA BONCODIN in her capacity as Secretary of the Department of Budget and Management, respondents.
ROBERTO PAGDANGANAN, intervenor.
DECISION
PANGANIBAN, J.:

The Constitution vests the President with the power of supervision, not control, over local government units
(LGUs). Such power enables him to see to it that LGUs and their officials execute their tasks in accordance with
law. While he may issue advisories and seek their cooperation in solving economic difficulties, he cannot prevent them
from performing their tasks and using available resources to achieve their goals. He may not withhold or alter any
authority or power given them by the law.Thus, the withholding of a portion of internal revenue allotments legally due
them cannot be directed by administrative fiat.
The Case

Before us is an original Petition for Certiorari and Prohibition seeking (1) to annul Section 1 of Administrative Order
(AO) No. 372, insofar as it requires local government units to reduce their expenditures by 25 percent of their authorized
regular appropriations for non-personal services; and (2) to enjoin respondents from implementing Section 4 of the
Order, which withholds a portion of their internal revenue allotments.
On November 17, 1998, Roberto Pagdanganan, through Counsel Alberto C. Agra, filed a Motion for
Intervention/Motion to Admit Petition for Intervention,[1] attaching thereto his Petition in Intervention[2] joining
petitioner in the reliefs sought. At the time, intervenor was the provincial governor of Bulacan, national president of the
League of Provinces of the Philippines and chairman of the League of Leagues of Local Governments. In a Resolution
dated December 15, 1998, the Court noted said Motion and Petition.
The Facts and the Arguments

On December 27, 1997, the President of the Philippines issued AO 372. Its full text, with emphasis on the assailed
provisions, is as follows:
"ADMINISTRATIVE ORDER NO. 372
ADOPTION OF ECONOMY MEASURES IN GOVERNMENT FOR FY 1998

WHEREAS, the current economic difficulties brought about by the peso depreciation requires continued prudence in
government fiscal management to maintain economic stability and sustain the country's growth momentum;

WHEREAS, it is imperative that all government agencies adopt cash management measures to match expenditures with
available resources;

NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines, by virtue of the powers vested in me
by the Constitution, do hereby order and direct:

SECTION 1. All government departments and agencies, including state universities and colleges, government-owned
and controlled corporations and local governments units will identify and implement measures in FY 1998 that will
reduce total expenditures for the year by at least 25% of authorized regular appropriations for non-personal services
items, along the following suggested areas:

1. Continued implementation of the streamlining policy on organization and staffing by deferring action on the
following:
a. Operationalization of new agencies;
b. Expansion of organizational units and/or creation of positions;
c. Filling of positions; and
d. Hiring of additional/new consultants, contractual and casual personnel, regardless of funding source.
2. Suspension of the following activities:
a. Implementation of new capital/infrastructure projects, except those which have already been contracted
out;
b. Acquisition of new equipment and motor vehicles;
c. All foreign travels of government personnel, except those associated with scholarships and trainings funded
by grants;
d. Attendance in conferences abroad where the cost is charged to the government except those clearly
essential to Philippine commitments in the international field as may be determined by the Cabinet;
e. Conduct of trainings/workshops/seminars, except those conducted by government training institutions and
agencies in the performance of their regular functions and those that are funded by grants;
f. Conduct of cultural and social celebrations and sports activities, except those associated with the Philippine
Centennial celebration and those involving regular competitions/events;
g. Grant of honoraria, except in cases where it constitutes the only source of compensation from government
received by the person concerned;
h. Publications, media advertisements and related items, except those required by law or those already being
undertaken on a regular basis;
i. Grant of new/additional benefits to employees, except those expressly and specifically authorized by law;
and
j. Donations, contributions, grants and gifts, except those given by institutions to victims of calamities.
3. Suspension of all tax expenditure subsidies to all GOCCs and LGUs
4. Reduction in the volume of consumption of fuel, water, office supplies, electricity and other utilities
5. Deferment of projects that are encountering significant implementation problems
6. Suspension of all realignment of funds and the use of savings and reserves
SECTION 2. Agencies are given the flexibility to identify the specific sources of cost-savings, provided the 25% minimum
savings under Section 1 is complied with.
SECTION 3. A report on the estimated savings generated from these measures shall be submitted to the Office of the
President, through the Department of Budget and Management, on a quarterly basis using the attached format.

SECTION 4. Pending the assessment and evaluation by the Development Budget Coordinating Committee of
the emerging fiscal situation, the amount equivalent to 10% of the internal revenue allotment to local
government units shall be withheld.
SECTION 5. The Development Budget Coordination Committee shall conduct a monthly review of the fiscal
position of the National Government and if necessary, shall recommend to the President the imposition of
additional reserves or the lifting of previously imposed reserves.
SECTION 6. This Administrative Order shall take effect January 1, 1998 and shall remain valid for the entire year
unless otherwise lifted.
DONE in the City of Manila, this 27th day of December, in the year of our Lord, nineteen hundred and ninety-seven."

Subsequently, on December 10, 1998, President Joseph E. Estrada issued AO 43, amending Section 4 of AO 372, by
reducing to five percent (5%) the amount of internal revenue allotment (IRA) to be withheld from the LGUs.
Petitioner contends that the President, in issuing AO 372, was in effect exercising the power of control over
LGUs. The Constitution vests in the President, however, only the power of general supervision over LGUs, consistent
with the principle of local autonomy. Petitioner further argues that the directive to withhold ten percent (10%) of their
IRA is in contravention of Section 286 of the Local Government Code and of Section 6, Article X of the Constitution,
providing for the automatic release to each of these units its share in the national internal revenue.
The solicitor general, on behalf of the respondents, claims on the other hand that AO 372 was issued to alleviate
the "economic difficulties brought about by the peso devaluation" and constituted merely an exercise of the President's
power of supervision over LGUs. It allegedly does not violate local fiscal autonomy, because it merely directs local
governments to identify measures that will reduce their total expenditures for non-personal services by at least 25
percent. Likewise, the withholding of 10 percent of the LGUs IRA does not violate the statutory prohibition on the
imposition of any lien or holdback on their revenue shares, because such withholding is "temporary in nature pending
the assessment and evaluation by the Development Coordination Committee of the emerging fiscal situation."
The Issues
[3]
The Petition submits the following issues for the Court's resolution:
"A. Whether or not the president committed grave abuse of discretion [in] ordering all LGUS to adopt a 25% cost
reduction program in violation of the LGU[']S fiscal autonomy
"B. Whether or not the president committed grave abuse of discretion in ordering the withholding of 10% of the LGU[']S
IRA"

In sum, the main issue is whether (a) Section 1 of AO 372, insofar as it "directs" LGUs to reduce their expenditures
by 25 percent; and (b) Section 4 of the same issuance, which withholds 10 percent of their internal revenue allotments,
are valid exercises of the President's power of general supervision over local governments.
Additionally, the Court deliberated on the question whether petitioner had the locus standi to bring this suit,
despite respondents' failure to raise the issue.[4] However, the intervention of Roberto Pagdanganan has rendered
academic any further discussion on this matter.

The Court's Ruling


The Petition is partly meritorious.
Main Issue:
Validity of AO 372
Insofar as LGUs Are Concerned

Before resolving the main issue, we deem it important and appropriate to define certain crucial concepts: (1) the
scope of the President's power of general supervision over local governments and (2) the extent of the local
governments' autonomy.
Scope of President's Power of Supervision Over LGUs

Section 4 of Article X of the Constitution confines the President's power over local governments to one of general
supervision. It reads as follows:
"Sec. 4. The President of the Philippines shall exercise general supervision over local governments. x x x"

This provision has been interpreted to exclude the power of control. In Mondano v. Silvosa,[5] the Court contrasted
the President's power of supervision over local government officials with that of his power of control over executive
officials of the national government. It was emphasized that the two terms -- supervision and control -- differed in
meaning and extent. The Court distinguished them as follows:
"x x x In administrative law, supervision means overseeing or the power or authority of an officer to see that subordinate
officers perform their duties. If the latter fail or neglect to fulfill them, the former may take such action or step as
prescribed by law to make them perform their duties. Control, on the other hand, means the power of an officer to alter
or modify or nullify or set aside what a subordinate officer ha[s] done in the performance of his duties and to substitute
the judgment of the former for that of the latter."[6]

In Taule v. Santos,[7] we further stated that the Chief Executive wielded no more authority than that of checking
whether local governments or their officials were performing their duties as provided by the fundamental law and by
statutes. He cannot interfere with local governments, so long as they act within the scope of their
authority. "Supervisory power, when contrasted with control, is the power of mere oversight over an inferior body; it
does not include any restraining authority over such body,"[8]we said.
In a more recent case, Drilon v. Lim,[9] the difference between control and supervision was further
delineated. Officers in control lay down the rules in the performance or accomplishment of an act. If these rules are not
followed, they may, in their discretion, order the act undone or redone by their subordinates or even decide to do it
themselves. On the other hand, supervision does not cover such authority. Supervising officials merely see to it that the
rules are followed, but they themselves do not lay down such rules, nor do they have the discretion to modify or replace
them. If the rules are not observed, they may order the work done or redone, but only to conform to such rules. They
may not prescribe their own manner of execution of the act. They have no discretion on this matter except to see to it
that the rules are followed.
Under our present system of government, executive power is vested in the President.[10] The members of the
Cabinet and other executive officials are merely alter egos. As such, they are subject to the power of control of the
President, at whose will and behest they can be removed from office; or their actions and decisions changed, suspended
or reversed.[11] In contrast, the heads of political subdivisions are elected by the people. Their sovereign powers emanate
from the electorate, to whom they are directly accountable. By constitutional fiat, they are subject to the Presidents
supervision only, not control, so long as their acts are exercised within the sphere of their legitimate powers. By the
same token, the President may not withhold or alter any authority or power given them by the Constitution and the law.
Extent of Local Autonomy

Hand in hand with the constitutional restraint on the President's power over local governments is the state policy of
ensuring local autonomy.[12]
In Ganzon v. Court of Appeals,[13] we said that local autonomy signified "a more responsive and accountable local
government structure instituted through a system of decentralization." The grant of autonomy is intended to "break up
the monopoly of the national government over the affairs of local governments, x x x not x x x to end the relation of
partnership and interdependence between the central administration and local government units x x x." Paradoxically,
local governments are still subject to regulation, however limited, for the purpose of enhancing self-government.[14]
Decentralization simply means the devolution of national administration, not power, to local governments. Local
officials remain accountable to the central government as the law may provide.[15] The difference between
decentralization of administration and that of power was explained in detail in Limbona v. Mangelin[16] as follows:
"Now, autonomy is either decentralization of administration or decentralization of power. There is decentralization of
administration when the central government delegates administrative powers to political subdivisions in order to
broaden the base of government power and in the process to make local governments 'more responsive and
accountable,'[17] and 'ensure their fullest development as self-reliant communities and make them more effective
partners in the pursuit of national development and social progress.'[18] At the same time, it relieves the central
government of the burden of managing local affairs and enables it to concentrate on national concerns. The President
exercises 'general supervision'[19] over them, but only to 'ensure that local affairs are administered according to
law.'[20] He has no control over their acts in the sense that he can substitute their judgments with his own.[21]

Decentralization of power, on the other hand, involves an abdication of political power in the favor of local government
units declared to be autonomous. In that case, the autonomous government is free to chart its own destiny and shape
its future with minimum intervention from central authorities. According to a constitutional author, decentralization of
power amounts to 'self-immolation,' since in that event, the autonomous government becomes accountable not to the
central authorities but to its constituency."[22]

Under the Philippine concept of local autonomy, the national government has not completely relinquished all its
powers over local governments, including autonomous regions. Only administrative powers over local affairs are
delegated to political subdivisions. The purpose of the delegation is to make governance more directly responsive and
effective at the local levels. In turn, economic, political and social development at the smaller political units are expected
to propel social and economic growth and development. But to enable the country to develop as a whole, the programs
and policies effected locally must be integrated and coordinated towards a common national goal. Thus, policy-setting
for the entire country still lies in the President and Congress. As we stated in Magtajas v. Pryce Properties Corp.,
Inc., municipal governments are still agents of the national government.[23]
The Nature of AO 372

Consistent with the foregoing jurisprudential precepts, let us now look into the nature of AO 372. As its preambular
clauses declare, the Order was a "cash management measure" adopted by the government "to match expenditures with
available resources," which were presumably depleted at the time due to "economic difficulties brought about by the
peso depreciation."Because of a looming financial crisis, the President deemed it necessary to "direct all government
agencies, state universities and colleges, government-owned and controlled corporations as well as local governments
to reduce their total expenditures by at least 25 percent along suggested areas mentioned in AO 372.
Under existing law, local government units, in addition to having administrative autonomy in the exercise of their
functions, enjoy fiscal autonomy as well. Fiscal autonomy means that local governments have the power to create their
own sources of revenue in addition to their equitable share in the national taxes released by the national government,
as well as the power to allocate their resources in accordance with their own priorities. It extends to the preparation of
their budgets, and local officials in turn have to work within the constraints thereof. They are not formulated at the
national level and imposed on local governments, whether they are relevant to local needs and resources or not. Hence,
the necessity of a balancing of viewpoints and the harmonization of proposals from both local and national
officials,[24] who in any case are partners in the attainment of national goals.
Local fiscal autonomy does not however rule out any manner of national government intervention by way of
supervision, in order to ensure that local programs, fiscal and otherwise, are consistent with national goals. Significantly,
the President, by constitutional fiat, is the head of the economic and planning agency of the government,[25] primarily
responsible for formulating and implementing continuing, coordinated and integrated social and economic policies,
plans and programs[26] for the entire country. However, under the Constitution, the formulation and the implementation
of such policies and programs are subject to "consultations with the appropriate public agencies, various private sectors,
and local government units." The President cannot do so unilaterally.
Consequently, the Local Government Code provides:[27]
"x x x [I]n the event the national government incurs an unmanaged public sector deficit, the President of the Philippines
is hereby authorized, upon the recommendation of [the] Secretary of Finance, Secretary of the Interior and Local
Government and Secretary of Budget and Management, and subject to consultation with the presiding officers of both
Houses of Congress and the presidents of the liga, to make the necessary adjustments in the internal revenue allotment
of local government units but in no case shall the allotment be less than thirty percent (30%) of the collection of national
internal revenue taxes of the third fiscal year preceding the current fiscal year x x x."

There are therefore several requisites before the President may interfere in local fiscal matters: (1) an unmanaged
public sector deficit of the national government; (2) consultations with the presiding officers of the Senate and the
House of Representatives and the presidents of the various local leagues; and (3) the corresponding recommendation of
the secretaries of the Department of Finance, Interior and Local Government, and Budget and
Management. Furthermore, any adjustment in the allotment shall in no case be less than thirty percent (30%) of the
collection of national internal revenue taxes of the third fiscal year preceding the current one.
Petitioner points out that respondents failed to comply with these requisites before the issuance and the
implementation of AO 372. At the very least, they did not even try to show that the national government was suffering
from an unmanageable public sector deficit. Neither did they claim having conducted consultations with the different
leagues of local governments.Without these requisites, the President has no authority to adjust, much less to reduce,
unilaterally the LGU's internal revenue allotment.
The solicitor general insists, however, that AO 372 is merely directory and has been issued by the President
consistent with his power of supervision over local governments. It is intended only to advise all government agencies
and instrumentalities to undertake cost-reduction measures that will help maintain economic stability in the country,
which is facing economic difficulties.Besides, it does not contain any sanction in case of noncompliance. Being merely an
advisory, therefore, Section 1 of AO 372 is well within the powers of the President. Since it is not a mandatory
imposition, the directive cannot be characterized as an exercise of the power of control.
While the wordings of Section 1 of AO 372 have a rather commanding tone, and while we agree with petitioner that
the requirements of Section 284 of the Local Government Code have not been satisfied, we are prepared to accept the
solicitor general's assurance that the directive to "identify and implement measures x x x that will reduce total
expenditures x x x by at least 25% of authorized regular appropriation" is merely advisory in character, and does not
constitute a mandatory or binding order that interferes with local autonomy. The language used, while authoritative,
does not amount to a command that emanates from a boss to a subaltern.
Rather, the provision is merely an advisory to prevail upon local executives to recognize the need for fiscal restraint
in a period of economic difficulty. Indeed, all concerned would do well to heed the President's call to unity, solidarity
and teamwork to help alleviate the crisis. It is understood, however, that no legal sanction may be imposed upon LGUs
and their officials who do not follow such advice. It is in this light that we sustain the solicitor general's contention in
regard to Section 1.
Withholding a Part of LGUs' IRA

Section 4 of AO 372 cannot, however, be upheld. A basic feature of local fiscal autonomy is the automatic release of
the shares of LGUs in the national internal revenue. This is mandated by no less than the Constitution.[28] The Local
Government Code[29] specifies further that the release shall be made directly to the LGU concerned within five (5) days
after every quarter of the year and "shall not be subject to any lien or holdback that may be imposed by the national
government for whatever purpose."[30] As a rule, the term "shall" is a word of command that must be given a compulsory
meaning.[31] The provision is, therefore, imperative.
Section 4 of AO 372, however, orders the withholding, effective January 1, 1998, of 10 percent of the LGUs' IRA
"pending the assessment and evaluation by the Development Budget Coordinating Committee of the emerging fiscal
situation" in the country. Such withholding clearly contravenes the Constitution and the law. Although temporary, it is
equivalent to a holdback, which means "something held back or withheld, often temporarily."[32] Hence, the "temporary"
nature of the retention by the national government does not matter. Any retention is prohibited.
In sum, while Section 1 of AO 372 may be upheld as an advisory effected in times of national crisis, Section 4
thereof has no color of validity at all. The latter provision effectively encroaches on the fiscal autonomy of local
governments. Concededly, the President was well-intentioned in issuing his Order to withhold the LGUs IRA, but the rule
of law requires that even the best intentions must be carried out within the parameters of the Constitution and the
law. Verily, laudable purposes must be carried out by legal methods.
Refutation of Justice Kapunan's Dissent

Mr. Justice Santiago M. Kapunan dissents from our Decision on the grounds that, allegedly, (1) the Petition is
premature; (2) AO 372 falls within the powers of the President as chief fiscal officer; and (3) the withholding of the LGUs
IRA is implied in the President's authority to adjust it in case of an unmanageable public sector deficit.
First, on prematurity. According to the Dissent, when "the conduct has not yet occurred and the challenged
construction has not yet been adopted by the agency charged with administering the administrative order, the
determination of the scope and constitutionality of the executive action in advance of its immediate adverse effect
involves too remote and abstract an inquiry for the proper exercise of judicial function."
This is a rather novel theory -- that people should await the implementing evil to befall on them before they can
question acts that are illegal or unconstitutional. Be it remembered that the real issue here is whether the Constitution
and the law are contravened by Section 4 of AO 372, not whether they are violated by the acts implementing it. In the
unanimous en banc case Taada v. Angara,[33] this Court held that when an act of the legislative department is seriously
alleged to have infringed the Constitution, settling the controversy becomes the duty of this Court. By the mere
enactment of the questioned law or the approval of the challenged action, the dispute is said to have ripened into a
judicial controversy even without any other overt act.Indeed, even a singular violation of the Constitution and/or the
law is enough to awaken judicial duty. Said the Court:
"In seeking to nullify an act of the Philippine Senate on the ground that it contravenes the Constitution, the petition no
doubt raises a justiciable controversy. Where an action of the legislative branch is seriously alleged to have infringed the
Constitution, it becomes not only the right but in fact the duty of the judiciary to settle the dispute. 'The question thus
posed is judicial rather than political. The duty (to adjudicate) remains to assure that the supremacy of the Constitution
is upheld.'[34] Once a 'controversy as to the application or interpretation of a constitutional provision is raised before this
Court x x x , it becomes a legal issue which the Court is bound by constitutional mandate to decide.'[35]
xxxxxxxxx
"As this Court has repeatedly and firmly emphasized in many cases,[36] it will not shirk, digress from or abandon its
sacred duty and authority to uphold the Constitution in matters that involve grave abuse of discretion brought before it
in appropriate cases, committed by any officer, agency, instrumentality or department of the government."

In the same vein, the Court also held in Tatad v. Secretary of the Department of Energy:[37]
"x x x Judicial power includes not only the duty of the courts to settle actual controversies involving rights which are
legally demandable and enforceable, but also the duty to determine whether or not there has been grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of government. The
courts, as guardians of the Constitution, have the inherent authority to determine whether a statute enacted by the
legislature transcends the limit imposed by the fundamental law. Where the statute violates the Constitution, it is not
only the right but the duty of the judiciary to declare such act unconstitutional and void."

By the same token, when an act of the President, who in our constitutional scheme is a coequal of Congress, is
seriously alleged to have infringed the Constitution and the laws, as in the present case, settling the dispute becomes
the duty and the responsibility of the courts.
Besides, the issue that the Petition is premature has not been raised by the parties; hence it is deemed
waived.Considerations of due process really prevents its use against a party that has not been given sufficient notice of
its presentation, and thus has not been given the opportunity to refute it.[38]
Second, on the President's power as chief fiscal officer of the country. Justice Kapunan posits that Section 4 of AO
372 conforms with the President's role as chief fiscal officer, who allegedly "is clothed by law with certain powers to
ensure the observance of safeguards and auditing requirements, as well as the legal prerequisites in the release and use
of IRAs, taking into account the constitutional and statutory mandates."[39] He cites instances when the President may
lawfully intervene in the fiscal affairs of LGUs.
Precisely, such powers referred to in the Dissent have specifically been authorized by law and have not been
challenged as violative of the Constitution. On the other hand, Section 4 of AO 372, as explained earlier, contravenes
explicit provisions of the Local Government Code (LGC) and the Constitution. In other words, the acts alluded to in the
Dissent are indeed authorized by law; but, quite the opposite, Section 4 of AO 372 is bereft of any legal or constitutional
basis.
Third, on the President's authority to adjust the IRA of LGUs in case of an unmanageable public sector deficit. It
must be emphasized that in striking down Section 4 of AO 372, this Court is not ruling out any form of reduction in the
IRAs of LGUs.Indeed, as the President may make necessary adjustments in case of an unmanageable public sector
deficit, as stated in the main part of this Decision, and in line with Section 284 of the LGC, which Justice Kapunan
cites. He, however, merely glances over a specific requirement in the same provision -- that such reduction is subject to
consultation with the presiding officers of both Houses of Congress and, more importantly, with the presidents of the
leagues of local governments.
Notably, Justice Kapunan recognizes the need for "interaction between the national government and the LGUs at
the planning level," in order to ensure that "local development plans x x x hew to national policies and standards." The
problem is that no such interaction or consultation was ever held prior to the issuance of AO 372. This is why the
petitioner and the intervenor (who was a provincial governor and at the same time president of the League of Provinces
of the Philippines and chairman of the League of Leagues of Local Governments) have protested and instituted this
action. Significantly, respondents do not deny the lack of consultation.
In addition, Justice Kapunan cites Section 287[40] of the LGC as impliedly authorizing the President to withhold the
IRA of an LGU, pending its compliance with certain requirements. Even a cursory reading of the provision reveals that it
is totally inapplicable to the issue at bar. It directs LGUs to appropriate in their annual budgets 20 percent of their
respective IRAs for development projects. It speaks of no positive power granted the President to priorly withhold any
amount. Not at all.
WHEREFORE, the Petition is GRANTED. Respondents and their successors are hereby
permanently PROHIBITED from implementing Administrative Order Nos. 372 and 43, respectively dated December 27,
1997 and December 10, 1998, insofar as local government units are concerned.
SO ORDERED.
Davide, Jr., C.J., Bellosillo, Melo, Puno, Vitug, Mendoza, Quisumbing, Pardo, Buena, Gonzaga-Reyes, and De Leon,
Jr., JJ., concur.
Kapunan, J., see dissenting opinion.
Purisima, and Ynares-Santiago, JJ., join J. Kapunan in his dissenting opinion.
G.R. No. 92299 April 19, 1991
REYNALDO R. SAN JUAN, petitioner,
vs.
CIVIL SERVICE COMMISSION, DEPARTMENT OF BUDGET AND MANAGEMENT and CECILIA ALMAJOSE,respondents.
Legal Services Division for petitioner.
Sumulong, Sumulong, Paras & Abano Law Offices for private respondent.

GUTIERREZ, JR., J.:


In this petition for certiorari pursuant to Section 7, Article IX (A) of the present Constitution, the petitioner Governor of
the Province of Rizal, prays for the nullification of Resolution No. 89-868 of the Civil Service Commission (CSC) dated
November 21, 1989 and its Resolution No. 90-150 dated February 9, 1990.

The dispositive portion of the questioned Resolution reads:

WHEREFORE, foregoing premises considered, the Commission resolved to dismiss, as it hereby dismisses the
appeal of Governor Reynaldo San Juan of Rizal. Accordingly, the approved appointment of Ms. Cecilia Almajose
as Provincial Budget Officer of Rizal, is upheld. (Rollo, p. 32)

The subsequent Resolution No. 90-150 reiterates CSC's position upholding the private respondent's appointment by
denying the petitioner's motion for reconsideration for lack of merit.

The antecedent facts of the case are as follows:

On March 22, 1988, the position of Provincial Budget Officer (PBO) for the province of Rizal was left vacant by its former
holder, a certain Henedima del Rosario.

In a letter dated April 18, 1988, the petitioner informed Director Reynaldo Abella of the Department of Budget and
Management (DBM) Region IV that Ms. Dalisay Santos assumed office as Acting PBO since March 22, 1988 pursuant to a
Memorandum issued by the petitioner who further requested Director Abella to endorse the appointment of the said
Ms. Dalisay Santos to the contested position of PBO of Rizal. Ms. Dalisay Santos was then Municipal Budget Officer of
Taytay, Rizal before she discharged the functions of acting PBO.

In a Memorandum dated July 26, 1988 addressed to the DBM Secretary, then Director Abella of Region IV recommended
the appointment of the private respondent as PBO of Rizal on the basis of a comparative study of all Municipal Budget
Officers of the said province which included three nominees of the petitioner. According to Abella, the private
respondent was the most qualified since she was the only Certified Public Accountant among the contenders.

On August 1, 1988, DBM Undersecretary Nazario S. Cabuquit, Jr. signed the appointment papers of the private
respondent as PBO of Rizal upon the aforestated recommendation of Abella.

In a letter dated August 3, 1988 addressed to Secretary Carague, the petitioner reiterated his request for the
appointment of Dalisay Santos to the contested position unaware of the earlier appointment made by Undersecretary
Cabuquit.

On August 31, 1988, DBM Regional Director Agripino G. Galvez wrote the petitioner that Dalisay Santos and his other
recommendees did not meet the minimum requirements under Local Budget Circular No. 31 for the position of a local
budget officer. Director Galvez whether or not through oversight further required the petitioner to submit at least three
other qualified nominees who are qualified for the position of PBO of Rizal for evaluation and processing.
On November 2, 1988, the petitioner after having been informed of the private respondent's appointment wrote
Secretary Carague protesting against the said appointment on the grounds that Cabuquit as DBM Undersecretary is not
legally authorized to appoint the PBO; that the private respondent lacks the required three years work experience as
provided in Local Budget Circular No. 31; and that under Executive Order No. 112, it is the Provincial Governor, not the
Regional Director or a Congressman, who has the power to recommend nominees for the position of PBO.

On January 9, 1989 respondent DBM, through its Director of the Bureau of Legal & Legislative Affairs (BLLA) Virgilio A.
Afurung, issued a Memorandum ruling that the petitioner's letter-protest is not meritorious considering that public
respondent DBM validly exercised its prerogative in filling-up the contested position since none of the petitioner's
nominees met the prescribed requirements.

On January 27, 1989, the petitioner moved for a reconsideration of the BLLA ruling.

On February 28, 1989, the DBM Secretary denied the petitioner's motion for reconsideration.

On March 27, 1989, the petitioner wrote public respondent CSC protesting against the appointment of the private
respondent and reiterating his position regarding the matter.

Subsequently, public respondent CSC issued the questioned resolutions which prompted the petitioner to submit before
us the following assignment of errors:

A. THE CSC ERRED IN UPHOLDING THE APPOINTMENT BY DBM ASSISTANT SECRETARY CABUQUIT OF CECILIA
ALMAJOSE AS PBO OF RIZAL.
B. THE CSC ERRED IN HOLDING THAT CECILIA ALMA JOSE POSSESSES ALL THE REQUIRED QUALIFICATIONS.
C. THE CSC ERRED IN DECLARING THAT PETITIONER'S NOMINEES ARE NOT QUALIFIED TO THE SUBJECT
POSITION.
D. THE CSC AND THE DBM GRAVELY ABUSED THEIR DISCRETION IN NOT ALLOWING PETITIONER TO SUBMIT
NEW NOMINEES WHO COULD MEET THE REQUIRED QUALIFICATION (Petition, pp. 7-8, Rollo, pp. 15-16)

All the assigned errors relate to the issue of whether or not the private respondent is lawfully entitled to discharge the
functions of PBO of Rizal pursuant to the appointment made by public respondent DBM's Undersecretary upon the
recommendation of then Director Abella of DBM Region IV.

The petitioner's arguments rest on his contention that he has the sole right and privilege to recommend the nominees
to the position of PBO and that the appointee should come only from his nominees. In support thereof, he invokes
Section 1 of Executive Order No. 112 which provides that:

Sec. 1. All budget officers of provinces, cities and municipalities shall be appointed henceforth by the Minister of
Budget and Management upon recommendation of the local chief executive concerned, subject to civil service
law, rules and regulations, and they shall be placed under the administrative control and technical supervision of
the Ministry of Budget and Management.

The petitioner maintains that the appointment of the private respondent to the contested position was made in
derogation of the provision so that both the public respondents committed grave abuse of discretion in upholding
Almajose's appointment.

There is no question that under Section 1 of Executive Order No. 112 the petitioner's power to recommend is subject to
the qualifications prescribed by existing laws for the position of PBO. Consequently, in the event that the
recommendations made by the petitioner fall short of the required standards, the appointing authority, the Minister
(now Secretary) of public respondent DBM is expected to reject the same.

In the event that the Governor recommends an unqualified person, is the Department Head free to appoint anyone he
fancies ? This is the issue before us.
Before the promulgation of Executive Order No. 112 on December 24, 1986, Batas Pambansa Blg. 337, otherwise known
as the Local Government Code vested upon the Governor, subject to civil service rules and regulations, the power to
appoint the PBO (Sec. 216, subparagraph (1), BP 337). The Code further enumerated the qualifications for the position of
PBO. Thus, Section 216, subparagraph (2) of the same code states that:

(2) No person shall be appointed provincial budget officer unless he is a citizen of the Philippines, of good moral
character, a holder of a degree preferably in law, commerce, public administration or any related course from a
recognized college or university, a first grade civil service eligibility or its equivalent, and has acquired at least
five years experience in budgeting or in any related field.

The petitioner contends that since the appointing authority with respect to the Provincial Budget Officer of Rizal was
vested in him before, then, the real intent behind Executive Order No. 112 in empowering him to recommend nominees
to the position of Provincial Budget Officer is to make his recommendation part and parcel of the appointment process.
He states that the phrase "upon recommendation of the local chief executive concerned" must be given mandatory
application in consonance with the state policy of local autonomy as guaranteed by the 1987 Constitution under Art. II,
Sec. 25 and Art. X, Sec. 2 thereof. He further argues that his power to recommend cannot validly be defeated by a mere
administrative issuance of public respondent DBM reserving to itself the right to fill-up any existing vacancy in case the
petitioner's nominees do not meet the qualification requirements as embodied in public respondent DBM's Local Budget
Circular No. 31 dated February 9, 1988.

The questioned ruling is justified by the public respondent CSC as follows:

As required by said E.O. No. 112, the DBM Secretary may choose from among the recommendees of the
Provincial Governor who are thus qualified and eligible for appointment to the position of the PBO of Rizal.
Notwithstanding, the recommendation of the local chief executive is merely directory and not a condition sine
qua non to the exercise by the Secretary of DBM of his appointing prerogative. To rule otherwise would in effect
give the law or E.O. No. 112 a different interpretation or construction not intended therein, taking into
consideration that said officer has been nationalized and is directly under the control and supervision of the
DBM Secretary or through his duly authorized representative. It cannot be gainsaid that said national officer has
a similar role in the local government unit, only on another area or concern, to that of a Commission on Audit
resident auditor. Hence, to preserve and maintain the independence of said officer from the local government
unit, he must be primarily the choice of the national appointing official, and the exercise thereof must not be
unduly hampered or interfered with, provided the appointee finally selected meets the requirements for the
position in accordance with prescribed Civil Service Law, Rules and Regulations. In other words, the appointing
official is not restricted or circumscribed to the list submitted or recommended by the local chief executive in
the final selection of an appointee for the position. He may consider other nominees for the position vis a vis the
nominees of the local chief executive. (CSC Resolution No. 89-868, p. 2; Rollo, p. 31)

The issue before the Court is not limited to the validity of the appointment of one Provincial Budget Officer. The tug of
war between the Secretary of Budget and Management and the Governor of the premier province of Rizal over a
seemingly innocuous position involves the application of a most important constitutional policy and principle, that of
local autonomy. We have to obey the clear mandate on local autonomy. Where a law is capable of two interpretations,
one in favor of centralized power in Malacañang and the other beneficial to local autonomy, the scales must be weighed
in favor of autonomy.

The exercise by local governments of meaningful power has been a national goal since the turn of the century. And yet,
inspite of constitutional provisions and, as in this case, legislation mandating greater autonomy for local officials,
national officers cannot seem to let go of centralized powers. They deny or water down what little grants of autonomy
have so far been given to municipal corporations.

President McKinley's Instructions dated April 7, 1900 to the Second Philippine Commission ordered the new
Government "to devote their attention in the first instance to the establishment of municipal governments in which
natives of the Islands, both in the cities and rural communities, shall be afforded the opportunity to manage their own
local officers to the fullest extent of which they are capable and subject to the least degree of supervision and control
which a careful study of their capacities and observation of the workings of native control show to be consistent with
the maintenance of law, order and loyalty.

In this initial organic act for the Philippines, the Commission which combined both executive and legislative powers was
directed to give top priority to making local autonomy effective.

The 1935 Constitution had no specific article on local autonomy. However, in distinguishing between presidential control
and supervision as follows:

The President shall have control of all the executive departments, bureaus, or offices, exercise general
supervision over all local governments as may be provided by law, and take care that the laws be faithfully
executed. (Sec. 11, Article VII, 1935 Constitution)

the Constitution clearly limited the executive power over local governments to "general supervision . . . as may be
provided by law." The President controls the executive departments. He has no such power over local governments. He
has only supervision and that supervision is both general and circumscribed by statute.

In Tecson v. Salas, 34 SCRA 275, 282 (1970), this Court stated:

. . . Hebron v. Reyes, (104 Phil. 175 [1958]) with the then Justice, now Chief Justice, Concepcion as theponente,
clarified matters. As was pointed out, the presidential competence is not even supervision in general, but
general supervision as may be provided by law. He could not thus go beyond the applicable statutory provisions,
which bind and fetter his discretion on the matter. Moreover, as had been earlier ruled in an opinion penned by
Justice Padilla in Mondano V. Silvosa, (97 Phil. 143 [1955]) referred to by the present Chief Justice in his opinion
in the Hebron case, supervision goes no further than "overseeing or the power or authority of an officer to see
that subordinate officers perform their duties. If the latter fail or neglect to fulfill them the former may take such
action or step as prescribed by law to make them perform their duties." (Ibid, pp. 147-148) Control, on the other
hand, "means the power of an officer to alter or modify or nullify or set aside what a subordinate had done in
the performance of their duties and to substitute the judgment of the former for that of the latter." It would
follow then, according to the present Chief Justice, to go back to the Hebron opinion, that the President had to
abide by the then provisions of the Revised Administrative Code on suspension and removal of municipal
officials, there being no power of control that he could rightfully exercise, the law clearly specifying the
procedure by which such disciplinary action would be taken.

Pursuant to this principle under the 1935 Constitution, legislation implementing local autonomy was enacted. In 1959,
Republic Act No. 2264, "An Act Amending the Law Governing Local Governments by Increasing Their Autonomy and
Reorganizing Local Governments" was passed. It was followed in 1967 when Republic Act No. 5185, the Decentralization
Law was enacted, giving "further autonomous powers to local governments governments."

The provisions of the 1973 Constitution moved the country further, at least insofar as legal provisions are concerned,
towards greater autonomy. It provided under Article II as a basic principle of government:

Sec. 10. The State shall guarantee and promote the autonomy of local government units, especially the barangay
to ensure their fullest development as self-reliant communities.

An entire article on Local Government was incorporated into the Constitution. It called for a local government code
defining more responsive and accountable local government structures. Any creation, merger, abolition, or substantial
boundary alteration cannot be done except in accordance with the local government code and upon approval by a
plebiscite. The power to create sources of revenue and to levy taxes was specifically settled upon local governments.
The exercise of greater local autonomy is even more marked in the present Constitution.

Article II, Section 25 on State Policies provides:


Sec. 25. The State shall ensure the autonomy of local governments
The 14 sections in Article X on Local Government not only reiterate earlier doctrines but give in greater detail the
provisions making local autonomy more meaningful. Thus, Sections 2 and 3 of Article X provide:

Sec. 2. The territorial and political subdivisions shall enjoy local autonomy.
Sec. 3. The Congress shall enact a local government code which shall provide for a more responsive and
accountable local government structure instituted through a system of decentralization with effective
mechanisms of recall, initiative, and referendum, allocate among the different local government units their
powers, responsibilities, and resources, and provide for the qualifications, election, appointment and removal,
term, salaries, powers and functions and duties of local officials, and all other matters relating to the
organization and operation of the local units.

When the Civil Service Commission interpreted the recommending power of the Provincial Governor as purely directory,
it went against the letter and spirit of the constitutional provisions on local autonomy. If the DBM Secretary jealously
hoards the entirety of budgetary powers and ignores the right of local governments to develop self-reliance and
resoluteness in the handling of their own funds, the goal of meaningful local autonomy is frustrated and set back.
The right given by Local Budget Circular No. 31 which states:

Sec. 6.0 — The DBM reserves the right to fill up any existing vacancy where none of the nominees of the local
chief executive meet the prescribed requirements.

is ultra vires and is, accordingly, set aside. The DBM may appoint only from the list of qualified recommendees
nominated by the Governor. If none is qualified, he must return the list of nominees to the Governor explaining why no
one meets the legal requirements and ask for new recommendees who have the necessary eligibilities and
qualifications.

The PBO is expected to synchronize his work with DBM. More important, however, is the proper administration of fiscal
affairs at the local level. Provincial and municipal budgets are prepared at the local level and after completion are
forwarded to the national officials for review. They are prepared by the local officials who must work within the
constraints of those budgets. They are not formulated in the inner sanctums of an all-knowing DBM and unilaterally
imposed on local governments whether or not they are relevant to local needs and resources. It is for this reason that
there should be a genuine interplay, a balancing of viewpoints, and a harmonization of proposals from both the local
and national officials. It is for this reason that the nomination and appointment process involves a sharing of power
between the two levels of government.

It may not be amiss to give by way of analogy the procedure followed in the appointments of Justices and
Judges.1âwphi1Under Article VIII of the Constitution, nominations for judicial positions are made by the Judicial and Bar
Council. The President makes the appointments from the list of nominees submitted to her by the Council. She cannot
apply the DBM procedure, reject all the Council nominees, and appoint another person whom she feels is better
qualified. There can be no reservation of the right to fill up a position with a person of the appointing power's personal
choice.

The public respondent's grave abuse of discretion is aggravated by the fact that Director Galvez required the Provincial
Governor to submit at least three other names of nominees better qualified than his earlier recommendation. It was a
meaningless exercise. The appointment of the private respondent was formalized before the Governor was extended
the courtesy of being informed that his nominee had been rejected. The complete disregard of the local government's
prerogative and the smug belief that the DBM has absolute wisdom, authority, and discretion are manifest.
In his classic work "Philippine Political Law" Dean Vicente G. Sinco stated that the value of local governments as
institutions of democracy is measured by the degree of autonomy that they enjoy. Citing Tocqueville, he stated that
"local assemblies of citizens constitute the strength of free nations. . . . A people may establish a system of free
government but without the spirit of municipal institutions, it cannot have the spirit of liberty." (Sinco, Philippine
Political Law, Eleventh Edition, pp. 705-706).
Our national officials should not only comply with the constitutional provisions on local autonomy but should also
appreciate the spirit of liberty upon which these provisions are based.

WHEREFORE, the petition is hereby GRANTED. The questioned resolutions of the Civil Service Commission are SET ASIDE.
The appointment of respondent Cecilia Almajose is nullified. The Department of Budget and Management is ordered to
appoint the Provincial Budget Officer of Rizal from among qualified nominees submitted by the Provincial Governor.
SO ORDERED.

G.R. No. 97764 August 10, 1992


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

MEDIALDEA, J.:

This is a petition for certiorari under Rule 65 of the Rules of Court seeking the annulment of the decision of the Regional
Trial Court of Makati, Branch 62, which granted the writ of preliminary injunction applied for by respondents
Municipality of Parañaque and Palanyag Kilusang Bayan for Service (Palanyag for brevity) against petitioner herein.

The antecedent facts are as follows:

On June 13, 1990, the respondent municipality passed Ordinance No. 86, Series of 1990 which authorized the closure of
J. Gabriel, G.G. Cruz, Bayanihan, Lt. Garcia Extension and Opena Streets located at Baclaran, Parañaque, Metro Manila
and the establishment of a flea market thereon. The said ordinance was approved by the municipal council pursuant to
MMC Ordinance No. 2, Series of 1979, authorizing and regulating the use of certain city and/or municipal streets, roads
and open spaces within Metropolitan Manila as sites for flea market and/or vending areas, under certain terms and
conditions.

On July 20, 1990, the Metropolitan Manila Authority approved Ordinance No. 86, s. 1990 of the municipal council of
respondent municipality subject to the following conditions:

1. That the aforenamed streets are not used for vehicular traffic, and that the majority of the residents do not
oppose the establishment of the flea market/vending areas thereon;
2. That the 2-meter middle road to be used as flea market/vending area shall be marked distinctly, and that the
2 meters on both sides of the road shall be used by pedestrians;
3. That the time during which the vending area is to be used shall be clearly designated;
4. That the use of the vending areas shall be temporary and shall be closed once the reclaimed areas are
developed and donated by the Public Estate Authority.

On June 20, 1990, the municipal council of Parañaque issued a resolution authorizing Parañaque Mayor Walfrido N.
Ferrer to enter into contract with any service cooperative for the establishment, operation, maintenance and
management of flea markets and/or vending areas.

On August 8, 1990, respondent municipality and respondent Palanyag, a service cooperative, entered into an agreement
whereby the latter shall operate, maintain and manage the flea market in the aforementioned streets with the
obligation to remit dues to the treasury of the municipal government of Parañaque. Consequently, market stalls were
put up by respondent Palanyag on the said streets.
On September 13, 1990, petitioner Brig. Gen. Macasiano, PNP Superintendent of the Metropolitan Traffic Command,
ordered the destruction and confiscation of stalls along G.G. Cruz and J. Gabriel St. in Baclaran. These stalls were later
returned to respondent Palanyag.

On October 16, 1990, petitioner Brig. General Macasiano wrote a letter to respondent Palanyag giving the latter ten (10)
days to discontinue the flea market; otherwise, the market stalls shall be dismantled.

Hence, on October 23, 1990, respondents municipality and Palanyag filed with the trial court a joint petition for
prohibition and mandamus with damages and prayer for preliminary injunction, to which the petitioner filed his
memorandum/opposition to the issuance of the writ of preliminary injunction.

On October 24, 1990, the trial court issued a temporary restraining order to enjoin petitioner from enforcing his letter-
order of October 16, 1990 pending the hearing on the motion for writ of preliminary injunction.

On December 17, 1990, the trial court issued an order upholding the validity of Ordinance No. 86 s. 1990 of the
Municipality' of Parañaque and enjoining petitioner Brig. Gen. Macasiano from enforcing his letter-order against
respondent Palanyag.

Hence, this petition was filed by the petitioner thru the Office of the Solicitor General alleging grave abuse of discretion
tantamount to lack or excess of jurisdiction on the part of the trial judge in issuing the assailed order.

The sole issue to be resolved in this case is whether or not an ordinance or resolution issued by the municipal council of
Parañaque authorizing the lease and use of public streets or thoroughfares as sites for flea markets is valid.

The Solicitor General, in behalf of petitioner, contends that municipal roads are used for public service and are therefore
public properties; that as such, they cannot be subject to private appropriation or private contract by any person, even
by the respondent Municipality of Parañaque. Petitioner submits that a property already dedicated to public use cannot
be used for another public purpose and that absent a clear showing that the Municipality of Parañaque has been
granted by the legislature specific authority to convert a property already in public use to another public use,
respondent municipality is, therefore, bereft of any authority to close municipal roads for the establishment of a flea
market. Petitioner also submits that assuming that the respondent municipality is authorized to close streets, it failed to
comply with the conditions set forth by the Metropolitan Manila Authority for the approval of the ordinance providing
for the establishment of flea markets on public streets. Lastly, petitioner contends that by allowing the municipal streets
to be used by market vendors the municipal council of respondent municipality violated its duty under the Local
Government Code to promote the general welfare of the residents of the municipality.

In upholding the legality of the disputed ordinance, the trial court ruled:

. . . that Chanter II Section 10 of the Local Government Code is a statutory grant of power given to local
government units, the Municipality of Parañaque as such, is empowered under that law to close its roads,
streets or alley subject to limitations stated therein (i.e., that it is in accordance with existing laws and the
provisions of this code).
xxx xxx xxx

The actuation of the respondent Brig. Gen. Levi Macasiano, though apparently within its power is in fact an
encroachment of power legally vested to the municipality, precisely because when the municipality enacted the
ordinance in question — the authority of the respondent as Police Superintendent ceases to be operative on the
ground that the streets covered by the ordinance ceases to be a public thoroughfare. (pp. 33-34, Rollo)

We find the petition meritorious. In resolving the question of whether the disputed municipal ordinance authorizing the
flea market on the public streets is valid, it is necessary to examine the laws in force during the time the said ordinance
was enacted, namely, Batas Pambansa Blg. 337, otherwise known as Local Government Code, in connection with
established principles embodied in the Civil Code an property and settled jurisprudence on the matter.
The property of provinces, cities and municipalities is divided into property for public use and patrimonial property (Art.
423, Civil Code). As to what consists of property for public use, Article 424 of Civil Code states:

Art. 424. Property for public use, in the provinces, cities and municipalities, consists of the provincial roads, city
streets, the squares, fountains, public waters, promenades, and public works for public service paid for by said
provinces, cities or municipalities.

All other property possessed by any of them is patrimonial and shall be governed by this Code, without
prejudice to the provisions of special laws.

Based on the foregoing, J. Gabriel G.G. Cruz, Bayanihan, Lt. Garcia Extension and Opena streets are local roads used for
public service and are therefore considered public properties of respondent municipality. Properties of the local
government which are devoted to public service are deemed public and are under the absolute control of Congress
(Province of Zamboanga del Norte v. City of Zamboanga, L-24440, March 28, 1968, 22 SCRA 1334). Hence, local
governments have no authority whatsoever to control or regulate the use of public properties unless specific authority is
vested upon them by Congress. One such example of this authority given by Congress to the local governments is the
power to close roads as provided in Section 10, Chapter II of the Local Government Code, which states:

Sec. 10. Closure of roads. — A local government unit may likewise, through its head acting pursuant to a
resolution of its sangguniang and in accordance with existing law and the provisions of this Code, close any
barangay, municipal, city or provincial road, street, alley, park or square. No such way or place or any part of
thereof shall be close without indemnifying any person prejudiced thereby. A property thus withdrawn from
public use may be used or conveyed for any purpose for which other real property belonging to the local unit
concerned might be lawfully used or conveyed. (Emphasis ours).

However, the aforestated legal provision which gives authority to local government units to close roads and other
similar public places should be read and interpreted in accordance with basic principles already established by law.

These basic principles have the effect of limiting such authority of the province, city or municipality to close a public
street or thoroughfare. Article 424 of the Civil Code lays down the basic principle that properties of public dominion
devoted to public use and made available to the public in general are outside the commerce of man and cannot be
disposed of or leased by the local government unit to private persons. Aside from the requirement of due process which
should be complied with before closing a road, street or park, the closure should be for the sole purpose of withdrawing
the road or other public property from public use when circumstances show that such property is no longer intended or
necessary for public use or public service. When it is already withdrawn from public use, the property then becomes
patrimonial property of the local government unit concerned (Article 422, Civil Code; Cebu Oxygen, etc. et al. v. Bercilles,
et al., G.R. No. L-40474, August 29, 1975, 66 SCRA 481). It is only then that the respondent municipality can "use or
convey them for any purpose for which other real property belonging to the local unit concerned might be lawfully used
or conveyed" in accordance with the last sentence of Section 10, Chapter II of Blg. 337, known as Local Government
Code. In one case, the City Council of Cebu, through a resolution, declared the terminal road of M. Borces Street,
Mabolo, Cebu City as an abandoned road, the same not being included in the City Development Plan. Thereafter, the
City Council passes another resolution authorizing the sale of the said abandoned road through public bidding. We held
therein that the City of Cebu is empowered to close a city street and to vacate or withdraw the same from public use.
Such withdrawn portion becomes patrimonial property which can be the object of an ordinary contract (Cebu Oxygen
and Acetylene Co., Inc. v. Bercilles, et al., G.R. No.
L-40474, August 29, 1975, 66 SCRA 481). However, those roads and streets which are available to the public in general
and ordinarily used for vehicular traffic are still considered public property devoted to public use. In such case, the local
government has no power to use it for another purpose or to dispose of or lease it to private persons. This limitation on
the authority of the local government over public properties has been discussed and settled by this Court en banc in
"Francisco V. Dacanay, petitioner v. Mayor Macaria Asistio, Jr., et al., respondents, G.R. No. 93654, May 6, 1992." This
Court ruled:
There is no doubt that the disputed areas from which the private respondents' market stalls are sought to be
evicted are public streets, as found by the trial court in Civil Case No. C-12921. A public street is property for
public use hence outside the commerce of man (Arts. 420, 424, Civil Code). Being outside the commerce of man,
it may not be the subject of lease or others contract (Villanueva, et al. v. Castañeda and Macalino, 15 SCRA 142
citing the Municipality of Cavite v. Rojas, 30 SCRA 602; Espiritu v. Municipal Council of Pozorrubio, 102 Phil. 869;
And Muyot v. De la Fuente, 48 O.G. 4860).

As the stallholders pay fees to the City Government for the right to occupy portions of the public street, the City
Government, contrary to law, has been leasing portions of the streets to them. Such leases or licenses are null
and void for being contrary to law. The right of the public to use the city streets may not be bargained away
through contract. The interests of a few should not prevail over the good of the greater number in the
community whose health, peace, safety, good order and general welfare, the respondent city officials are under
legal obligation to protect.

The Executive Order issued by acting Mayor Robles authorizing the use of Heroes del '96 Street as a vending
area for stallholders who were granted licenses by the city government contravenes the general law that
reserves city streets and roads for public use. Mayor Robles' Executive Order may not infringe upon the vested
right of the public to use city streets for the purpose they were intended to serve: i.e., as arteries of travel for
vehicles and pedestrians.

Even assuming, in gratia argumenti, that respondent municipality has the authority to pass the disputed ordinance, the
same cannot be validly implemented because it cannot be considered approved by the Metropolitan Manila Authority
due to non-compliance by respondent municipality of the conditions imposed by the former for the approval of the
ordinance, to wit:

1. That the aforenamed streets are not used for vehicular traffic, and that the majority of the residents do(es)
not oppose the establishment of the flea market/vending areas thereon;
2. That the 2-meter middle road to be used as flea market/vending area shall be marked distinctly, and that the
2 meters on both sides of the road shall be used by pedestrians;
3. That the time during which the vending area is to be used shall be clearly designated;
4. That the use of the vending areas shall be temporary and shall be closed once the reclaimed areas are
developed and donated by the Public Estate Authority. (p. 38, Rollo)

Respondent municipality has not shown any iota of proof that it has complied with the foregoing conditions precedent
to the approval of the ordinance. The allegations of respondent municipality that the closed streets were not used for
vehicular traffic and that the majority of the residents do not oppose the establishment of a flea market on said streets
are unsupported by any evidence that will show that this first condition has been met. Likewise, the designation by
respondents of a time schedule during which the flea market shall operate is absent.

Further, it is of public notice that the streets along Baclaran area are congested with people, houses and traffic brought
about by the proliferation of vendors occupying the streets. To license and allow the establishment of a flea market
along J. Gabriel, G.G. Cruz, Bayanihan, Lt. Garcia Extension and Opena streets in Baclaran would not help in solving the
problem of congestion. We take note of the other observations of the Solicitor General when he said:

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

Along G.G. Cruz Street is a hospital, the St. Rita Hospital. However, its ambulances and the people rushing their
patients to the hospital cannot pass through G.G. Cruz because of the stalls and the vendors. One can only
imagine the tragedy of losing a life just because of a few seconds delay brought about by the inaccessibility of
the streets leading to the hospital.
The children, too, suffer. In view of the occupancy of the roads by stalls and vendors, normal transportation flow
is disrupted and school children have to get off at a distance still far from their schools and walk, rain or shine.

Indeed one can only imagine the garbage and litter left by vendors on the streets at the end of the day. Needless
to say, these cause further pollution, sickness and deterioration of health of the residents therein. (pp. 21-
22, Rollo)

Respondents do not refute the truth of the foregoing findings and observations of petitioners. Instead, respondents
want this Court to focus its attention solely on the argument that the use of public spaces for the establishment of a flea
market is well within the powers granted by law to a local government which should not be interfered with by the
courts.

Verily, the powers of a local government unit are not absolute. They are subject to limitations laid down by toe
Constitution and the laws such as our Civil Code. Moreover, the exercise of such powers should be subservient to
paramount considerations of health and well-being of the members of the community. Every local government unit has
the sworn obligation to enact measures that will enhance the public health, safety and convenience, maintain peace and
order, and promote the general prosperity of the inhabitants of the local units. Based on this objective, the local
government should refrain from acting towards that which might prejudice or adversely affect the general welfare.

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

The instant case as well as the Dacanay case, involves an ordinance which is void and illegal for lack of basis and
authority in laws applicable during its time. However, at this point, We find it worthy to note that Batas Pambansa Blg.
337, known as Local Government Lode, has already been repealed by Republic Act No. 7160 known as Local Government
Code of 1991 which took effect on January 1, 1992. Section 5(d) of the new Code provides that rights and obligations
existing on the date of effectivity of the new Code and arising out of contracts or any other source of prestation
involving a local government unit shall be governed by the original terms and conditions of the said contracts or the law
in force at the time such rights were vested.

ACCORDINGLY, the petition is GRANTED and the decision of the respondent Regional Trial Court dated December 17,
1990 which granted the writ of preliminary injunction enjoining petitioner as PNP Superintendent, Metropolitan Traffic
Command from enforcing the demolition of market stalls along J. Gabriel, G.G. Cruz, Bayanihan, Lt. Garcia Extension and
Opena streets is hereby RESERVED and SET ASIDE.

SO ORDERED.
[G.R. No. 143596. December 11, 2003]
JUDGE TOMAS C. LEYNES, petitioner, vs. THE COMMISSION ON AUDIT (COA), HON. GREGORIA S. ONG, DIRECTOR,
COMMISSION ON AUDIT and HON. SALVACION DALISAY, PROVINCIAL AUDITOR, respondents.
DECISION
CORONA, J.:

Before us is a petition for certiorari under Rule 65 in relation to Section 2, Rule 64 of the Rules of Court, seeking to
reverse and set aside the decision[1] dated September 14, 1999 of the Commission on Audit (COA), affirming the
resolution of COA Regional Director Gregoria S. Ong dated March 29, 1994 which in turn affirmed the opinion dated
October 19, 1993 of the Provincial Auditor of Oriental Mindoro, Salvacion M. Dalisay. All three denied the grant
of P1,600 monthly allowance to petitioner Judge Tomas C. Leynes by the Municipality of Naujan, Oriental Mindoro.
FACTUAL ANTECEDENTS

Petitioner Judge Tomas C. Leynes who, at present, is the presiding judge of the Regional Trial Court of Calapan City,
Oriental Mindoro, Branch 40 was formerly assigned to the Municipality of Naujan, Oriental Mindoro as the sole
presiding judge of the Municipal Trial Court thereof. As such, his salary and representation and transportation allowance
(RATA) were drawn from the budget of the Supreme Court. In addition, petitioner received a monthly allowance
of P944 from the local funds[2] of the Municipality of Naujan starting 1984.[3]
On March 15, 1993, the Sangguniang Bayan of Naujan, through Resolution No. 057, sought the opinion of the
Provincial Auditor and the Provincial Budget Officer regarding any budgetary limitation on the grant of a monthly
allowance by the municipality to petitioner judge. On May 7, 1993, the Sangguniang Bayan unanimously approved
Resolution No. 101 increasing petitioner judges monthly allowance from P944 to P1,600 (an increase of P656) starting
May 1993.[4] By virtue of said resolution, the municipal government (the Municipal Mayor and the Sangguniang Bayan)
approved a supplemental budget which was likewise approved by the Sangguniang Panlalawigan and the Office of
Provincial Budget and Management of Oriental Mindoro. In 1994, the Municipal Government of Naujan again provided
for petitioner judges P1,600 monthly allowance in its annual budget which was again approved by
the Sangguniang Panlalawigan and the Office of Provincial Budget and Management of Oriental Mindoro.[5]
On February 17, 1994, Provincial Auditor Salvacion M. Dalisay sent a letter to the Municipal Mayor and
the SangguniangBayan of Naujan directing them to stop the payment of the P1,600 monthly allowance or RATA to
petitioner judge and to require the immediate refund of the amounts previously paid to the latter. She opined that
the Municipality of Naujan could not grant RATA to petitioner judge in addition to the RATA the latter was already
receiving from the Supreme Court. Her directive was based on the following:
Section 36, RA No. 7645, General Appropriations Act of 1993

Representation and Transportation Allowances. The following officials and those of equivalent rank as may be
determined by the Department of Budget and Management (DBM) while in the actual performance of their respective
functions are hereby granted monthly commutable representation and transportation allowances payable from the
programmed appropriations provided for their respective offices, not exceeding the rates indicated below . . .

National Compensation Circular No. 67 dated January 1, 1992, of the Department of Budget and Management

Subject: Representation and Transportation Allowances of National Government Officials and Employees

xxxxxxxxx

4. Funding Source: In all cases, commutable and reimbursable RATA shall be paid from the amount appropriated for the
purpose and other personal services savings of the agency or project from where the officials and employees covered
under this Circular draw their salaries. No one shall be allowed to collect RATA from more than one source.[6] (emphasis
supplied)
Petitioner judge appealed to COA Regional Director Gregoria S. Ong who, however, upheld the opinion of Provincial
Auditor Dalisay and who added that Resolution No. 101, Series of 1993 of the Sangguniang Bayan of Naujan failed to
comply with Section 3 of Local Budget Circular No. 53 dated September 1, 1993 outlining the conditions for the grant of
allowances to judges and other national officials or employees by the local government units (LGUs). Section 3 of the
said budget circular provides that:
Sec. 3 Allowances. ─ LGUs may grant allowances/additional compensation to the national government
officials/employees assigned to their locality at rates authorized by law, rules and regulations and subject to the
following preconditions:

a. That the annual income or finances of the municipality, city or province as certified by the Accountant
concerned will allow the grant of the allowances/additional compensation without exceeding the
general limitations for personal services under Section 325 of RA 7160;
b. That the budgetary requirements under Section 324 of RA 7160 including the full requirement of RA 6758
have been satisfied and provided fully in the budget as certified by the Budget Officer and COA
representative in the LGU concerned;
c. That the LGU has fully implemented the devolution of personnel/functions in accordance with the provisions
of RA 7160;
d. That the LGU has already created mandatory positions prescribed in RA 7160; and
e. That similar allowances/additional compensation are not granted by the national government to the
officials/employees assigned to the LGU.[7]
Petitioner judge appealed the unfavorable resolution of the Regional Director to the Commission on Audit. In the
meantime, a disallowance of the payment of the P1,600 monthly allowance to petitioner was issued. Thus he received
his P1,600 monthly allowance from the Municipality of Naujan only for the period May 1993 to January 1994.
On September 14, 1999, the COA issued its decision affirming the resolution of Regional Director Gregoria S. Ong:
The main issue . . . is whether or not the Municipality of Naujan, Oriental Mindoro can validly provide RATA to its
Municipal Judge, in addition to that provided by the Supreme Court.

Generally, the grant of (RATA) [sic] to qualified national government officials and employees pursuant to Section 36 of
R.A. 7645 [General Appropriations Act of 1993] and NCC No. 67 dated 01 January 1992 is subject to the following
conditions to wit:

1. Payable from the programmed /appropriated amount and others from personal services savings of the
respective offices where the officials or employees draw their salaries;
2. Not exceeding the rates prescribed by the Annual General Appropriations Act;
3. Officials /employees on detail with other offices or assigned to serve other offices or agencies shall be paid
from their parent agencies;
4. No one shall be allowed to collect RATA from more than one source.

On the other hand, the municipal government may provide additional allowances and other benefits to judges and other
national government officials or employees assigned or stationed in the municipality, provided, that the finances of the
municipality allow the grant thereof pursuant to Section 447, Par. 1 (xi), R.A. 7160, and provided further, that similar
allowance/additional compensation are not granted by the national government to the official/employee assigned to
the local government unit as provided under Section 3(e) of Local Budget Circular No. 53, dated 01 September 1993.

The conflicting provisions of Section 447, Par. (1) (xi) of the Local Government Code of 1991 and Section 36 of the General
Appropriations Act of 1993 [RA 7645] have been harmonized by the Local Budget Circular No. 53 dated 01 September
1993, issued by the Department of Budget and Management pursuant to its powers under Section 25 and Section 327 of
the Local Government Code. The said circular must be adhered to by the local government units particularly Section 3
thereof which provides the implementing guidelines of Section 447, Par. (1) (xi) of the Local Government Code of 1991 in
the grant of allowances to national government officials/employees assigned or stationed in their respective local
government units.
Consequently, the subject SB Resolution No. 101 dated 11 May 1993 of the Sangguniang Bayan of Naujan,
Oriental Mindoro, having failed to comply with the inherent precondition as defined in Section 3 (e). . . is null and
void. Furthermore, the Honorable Judge Tomas C. Leynes, being a national government official is prohibited to receive
additional RATA from the local government fund pursuant to Section 36 of the General Appropriations Act (R.A. 7645 for
1993) and National Compensation Circular No. 67 dated 1 January 1992.[8] (emphasis ours)

ASSIGNMENTS OF ERROR

Petitioner judge filed a motion for reconsideration of the above decision but it was denied by the Commission in a
resolution dated May 30, 2000. Aggrieved, petitioner filed the instant petition, raising the following assignments of error
for our consideration:
I
WHETHER OR NOT RESOLUTION NO. 1O1, SERIES OF 1993 OF NAUJAN, ORIENTAL MINDORO, WHICH GRANTED
ADDITIONAL ALLOWANCE TO THE MUNICIPAL TRIAL JUDGE OF NAUJAN, ORIENTAL MINDORO AND INCREASING HIS
CURRENT REPRESENTATION AND TRAVELLING ALLOWANCE (RATA) TO AN AMOUNT EQUIVALENT TO THAT RECEIVED
MONTHLY BY SANGGUNIANG MEMBERS IN PESOS: ONE THOUSAND SIX HUNDRED (P1,600.00) EFFECTIVE 1993, IS
VALID.
II
WHETHER OR NOT THE POWER OF MUNICIPAL GOVERNMENTS TO GRANT ADDITIONAL ALLOWANCES AND OTHER
BENEFITS TO NATIONAL GOVERNMENT EMPLOYEES STATIONED IN THEIR MUNICIPALITY IS VERY EXPLICIT AND
UNEQUIVOCAL UNDER THE LOCAL GOVERNMENT CODE OF 1991 PARTICULARLY SECTION 447 IN RELATION TO SECTIONS
17 AND 22 THEREOF.
III
WHETHER OR NOT THE DEPARTMENT OF BUDGET AND MANAGEMENT (DBM) CAN, BY THE ISSUANCE OF BUDGET
CIRCULARS, RESTRICT A MUNICIPAL GOVERNMENT FROM EXERCISING ITS GIVEN LEGISLATIVE POWERS OF PROVIDING
ADDITIONAL ALLOWANCES AND OTHER BENEFITS TO NATIONAL EMPLOYEES STATIONED OR ASSIGNED TO THEIR
MUNICIPALITY FOR AS LONG AS THEIR FINANCES SO ALLOW.
IV
WHETHER OR NOT THE LOCAL GOVERNMENT CODE OF 1991 PARTICULARLY SECTION 447 (a) (1) (xi) WAS EXPRESSLY OR
IMPLIEDLY REPEALED OR MODIFIED BY REPUBLIC ACT 7645 AND THE GENERAL APPROPRIATIONS ACT OF 1993.
V
WHETHER OR NOT PETITIONER WAS ENTITLED TO RECEIVE THE ADDITIONAL ALLOWANCES GRANTED TO HIM BY THE
MUNICIPALITY OF NAUJAN, ORIENTAL MINDORO BY VIRTUE OF ITS RESOLUTION NO. 101, SERIES OF 1993.

POSITION OF COA

Respondent Commission on Audit opposes the grant by the Municipality of Naujan of the P1,600 monthly
allowance to petitioner Judge Leynes for the reason that the municipality could not grant RATA to judges in addition to
the RATA already received from the Supreme Court.[9] Respondent bases its contention on the following:
1. National Compensation Circular No. 67 (hereafter NCC No. 67) dated January 1, 1992 of the Department of
Budget and Management (DBM) which provides that (a) the RATA of national officials and employees shall be
payable from the programmed appropriations or personal services savings of the agency where such officials
or employees draw their salary and (b) no one shall be allowed to collect RATA from more than one source;
2. the General Appropriations Act of 1993 (RA 7645) which provided that the RATA of national officials shall be
payable from the programmed appropriations of their respective offices and
3. Local Budget Circular No. 53 (hereafter LBC No. 53) dated September 1, 1993 of the DBM which prohibits local
government units from granting allowances to national government officials or employees stationed in their
localities when such allowances are also granted by the national government or are similar to the allowances
granted by the national government to such officials or employees.[10]
POSITION OF PETITIONER
Petitioner judge, on the other hand, asserts that the municipality is expressly and unequivocally empowered by RA
7160 (the Local Government Code of 1991) to enact appropriation ordinances granting allowances and other benefits to
judges stationed in its territory. Section 447(a)(1)(xi) of the Local Government Code of 1991 imposes only one condition,
that is, when the finances of the municipal government allow. The Code does not impose any other restrictions in the
exercise of such power by the municipality. Petitioner also asserts that the DBM cannot amend or modify a substantive
law like the Local Government Code of 1991 through mere budget circulars. Petitioner emphasizes that budget circulars
must conform to, not modify or amend, the provisions of the law it seeks to implement.[11]
HISTORY OF GRANT OF
ALLOWANCES TO JUDGES
The power of local government units (LGUs) to grant allowances to judges stationed in their respective territories
was originally provided by Letter of Instruction No. 1418 dated July 18, 1984 (hereafter LOI No. 1418):
WHEREAS, the State is cognizant of the need to maintain the independence of the Judiciary;
WHEREAS, the budgetary allotment of the Judiciary constitutes only a small percentage of the national budget;
WHEREAS, present economic conditions adversely affected the livelihood of the members of the Judiciary;
WHEREAS, some local government units are ready, willing and able to pay additional allowances to Judges of various
courts within their respective territorial jurisdiction;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of the Philippines, do hereby direct:

1. Section 3 of Letter of Implementation No. 96 is hereby amended to read as follows:

3. The allowances provided in this letter shall be borne exclusively by the National Government. However,
provincial, city and municipal governments may pay additional allowances to the members and
personnel of the Judiciary assigned in their respective areas out of available local funds but not to
exceed P1,500.00; Provided, that in Metropolitan Manila, the city and municipal governments therein
may pay additional allowances not exceeding P3,000.00. (emphasis ours)[12]

On June 25, 1991, the DBM issued Circular No. 91-7 outlining the guidelines for the continued receipt of allowances
by judges from LGUs:
Consistent with the constitutional provision on the fiscal autonomy of the judiciary and the policy of the National
Government of allowing greater autonomy to local government units, judges of the Judiciary are hereby allowed to
continue to receive allowances at the same rates which they have been receiving from the Local Government Units as of
June 30, 1989, subject to the following guidelines:

1. That the continuance of payment of subject allowance to the recipient judge shall be entirely voluntary and
non-compulsory on the part of the Local Government Units;
2. That payment of the above shall always be subject to the availability of local funds;
3. That it shall be made only in compliance with the policy of non-diminution of compensation received by the
recipient judge before the implementation of the salary standardization;
4. That the subject allowance shall be given only to judges who were receiving the same as of June 30,
1989 and shall be co-terminous with the incumbent judges; and
5. That the subject allowance shall automatically terminate upon transfer of a judge from one local
government unit to another local government unit. (emphasis ours)

On October 10, 1991, Congress enacted RA 7160, otherwise known as the Local Government Code of 1991. [13] The
power of the LGUs to grant allowances and other benefits to judges and other national officials stationed in their
respective territories was expressly provided in Sections 447(a)(1)(xi), 458(a)(1)(xi) and 468(a)(1)(xi) of the Code.
On March 15, 1994, the DBM issued Local Budget Circular No. 55 (hereafter LBC No. 55) setting out the maximum
amount of allowances that LGUs may grant to judges. For provinces and cities, the amount should not exceed P1,000
and for municipalities, P700.
On December 3, 2002, we struck down the above circular in Dadole, et al. vs. COA.[14] We ruled there that the Local
Government Code of 1991 clearly provided that LGUs could grant allowances to judges, subject only to the condition
that the finances of the LGUs allowed it. We held that setting a uniform amount for the grant of allowances (was) an
inappropriate way of enforcing said criterion. Accordingly, we declared that the DBM exceeded its power of supervision
over LGUs by imposing a prohibition that did not jibe with the Local Government Code of 1991.[15]
ESTABLISHED PRINCIPLES INVOLVED

From the foregoing history of the power of LGUs to grant allowances to judges, the following principles should be
noted:
1. the power of LGUs to grant allowances to judges has long been recognized (since 1984 by virtue of LOI No. 1418)
and, at present, it is expressly and unequivocally provided in Sections 447, 458 and 468 of the Local
Government Code of 1991;
2. the issuance of DBM Circular No. 91-7 dated June 25, 1991 and LBC No. 55 dated March 15, 1994 indicates that
the national government recognizes the power of LGUs to grant such allowances to judges;
3. in Circular No. 91-7, the national government merely provides the guidelines for the continued receipt of
allowances by judges from LGUs while in LBC No. 55, the national government merely tries to limit the
amount of allowances LGUsmay grant to judges and
4. in the recent case of Dadole, et al. vs. COA, the Court upheld the constitutionally enshrined autonomy of LGUs to
grant allowances to judges in any amount deemed appropriate, depending on availability of funds, in
accordance with the Local Government Code of 1991.

OUR RULING

We rule in favor of petitioner judge. Respondent COA erred in opposing the grant of the P1,600 monthly allowance
by the Municipality of Naujan to petitioner Judge Leynes.
DISCUSSION OF OUR RULING

Section 447(a)(1)(xi) of RA 7160, the Local Government Code of 1991, provides:


(a) The sangguniang bayan, as the legislative body of the municipality, shall enact ordinances, approve resolutions and
appropriate funds for the general welfare of the municipality and its inhabitants . . ., and shall:
(1) Approve ordinances and pass resolutions necessary for an efficient and effective municipal government, and in this
connection shall:
xxxxxxxxx

(xi) When the finances of the municipal government allow, provide for additional allowances and other benefits to
judges, prosecutors, public elementary and high school teachers, and other national government officials stationed in or
assigned to the municipality; (emphasis ours)

Respondent COA, however, contends that the above section has been repealed, modified or amended by NCC No.
67 dated January 1, 1992, RA 7645 (the General Appropriations Act of 1993) and LBC No. 53 dated September 1, 1993.[16]
It is elementary in statutory construction that an administrative circular cannot supersede, abrogate, modify or
nullify a statute. A statute is superior to an administrative circular, thus the latter cannot repeal or amend it. [17] In the
present case, NCC No. 67, being a mere administrative circular, cannot repeal a substantive law like RA 7160.
It is also an elementary principle in statutory construction that repeal of statutes by implication is not favored,
unless it is manifest that the legislature so intended. The legislature is assumed to know the existing laws on the subject
and cannot be presumed to have enacted inconsistent or conflicting statutes.[18] Respondent COA alleges that Section 36
of RA 7645 (the GAA of 1993) repealed Section 447(a)(l)(xi) of RA 7160 (the LGC of 1991). A review of the two laws,
however, shows that this was not so. Section 36 of RA 7645 merely provided for the different rates of RATA payable to
national government officials or employees, depending on their position, and stated that these amounts were payable
from the programmed appropriations of the parent agencies to which the concerned national officials or employees
belonged. Furthermore, there was no other provision in RA 7645 from which a repeal of Section 447(a) (l)(xi) of RA 7160
could be implied. In the absence, therefore, of any clear repeal of Section 447(a)(l)(xi) of RA 7160, we cannot presume
such intention on the part of the legislature.
Moreover, the presumption against implied repeal becomes stronger when, as in this case, one law is special and
the other is general.[19] The principle is expressed in the maxim generalia specialibus non derogant, a general law does
not nullify a specific or special law. The reason for this is that the legislature, in passing a law of special character,
considers and makes special provisions for the particular circumstances dealt with by the special law. This being so, the
legislature, by adopting a general law containing provisions repugnant to those of the special law and without making
any mention of its intention to amend or modify such special law, cannot be deemed to have intended an amendment,
repeal or modification of the latter.[20]
In this case, RA 7160 (the LGC of 1991) is a special law[21] which exclusively deals with local government units
(LGUs), outlining their powers and functions in consonance with the constitutionally mandated policy of local
autonomy. RA 7645 (the GAA of 1993), on the other hand, was a general law[22] which outlined the share in the national
fund of all branches of the national government. RA 7645 therefore, being a general law, could not have, by mere
implication, repealed RA 7160. Rather, RA 7160 should be taken as the exception to RA 7645 in the absence of
circumstances warranting a contrary conclusion.[23]
The controversy actually centers on the seemingly sweeping provision in NCC No. 67 which states that no one shall
be allowed to collect RATA from more than one source. Does this mean that judges cannot receive allowances
from LGUs in addition to the RATA from the Supreme Court? For reasons that will hereinafter be discussed, we answer
in the negative.
The pertinent provisions of NCC No. 67 read:
3. Rules and Regulations:

3.1.1 Payment of RATA, whether commutable or reimbursable, shall be in accordance with the rates prescribed
for each of the following officials and employees and those of equivalent ranks, and the conditions
enumerated under the pertinent sections of the General Provisions of the annual General
Appropriations Act (GAA):
xxxxxxxxx
4. Funding Source:
In all cases, commutable and reimbursable RATA shall be paid from the amount appropriated for the purpose and other
personal services savings of the agency or project from where the officials and employees covered under this Circular
draw their salaries. No one shall be allowed to collect RATA from more than one source. (emphasis ours)
In construing NCC No. 67, we apply the principle in statutory construction that force and effect should not be
narrowly given to isolated and disjoined clauses of the law but to its spirit, broadly taking all its provisions together in
one rational view.[24]Because a statute is enacted as a whole and not in parts or sections, that is, one part is as important
as the others, the statute should be construed and given effect as a whole. A provision or section which is unclear by
itself may be clarified by reading and construing it in relation to the whole statute.[25]
Taking NCC No. 67 as a whole then, what it seeks to prevent is the dual collection of RATA by a national official from
the budgets of more than one national agency. We emphasize that the other source referred to in the prohibition
is another national agency. This can be gleaned from the fact that the sentence no one shall be allowed to collect RATA
from more than one source (the controversial prohibition) immediately follows the sentence that RATA shall be paid
from the budget of the national agency where the concerned national officials and employees draw their salaries. The
fact that the other source is another national agency is supported by RA 7645 (the GAA of 1993) invoked by respondent
COA itself and, in fact, by all subsequent GAAs for that matter, because the GAAs all essentially provide that (1) the RATA
of national officials shall be payable from the budgets of their respective national agencies and (2) those officials on
detail with other national agencies shall be paid their RATA only from the budget of their parent national agency:
Section 36, RA 7645, General Appropriations Act of 1993:

Representation and Transportation Allowances. The following officials and those of equivalent rank as may be
determined by the Department of Budget and Management (DBM) while in the actual performance of their respective
functions are hereby granted monthly commutable representation and transportation allowances payable from the
programmed appropriations provided for their respective offices, not exceeding the rates indicated below, which shall
apply to each type of allowance:
xxxxxxxxx
Officials on detail with other offices, including officials of the Commission of Audit assigned to serve other offices or
agencies, shall be paid the allowance herein authorized from the appropriations of their parent agencies. (emphasis ours)
Clearly therefore, the prohibition in NCC No. 67 is only against the dual or multiple collection of RATA by a national
official from the budgets of two or more national agencies. Stated otherwise, when a national official is on detail with
another national agency, he should get his RATA only from his parent national agency and not from the other national
agency he is detailed to.
Since the other source referred in the controversial prohibition is another national agency, said prohibition clearly
does not apply to LGUs like the Municipality of Naujan. National agency of course refers to the different offices, bureaus
and departments comprising the national government. The budgets of these departments or offices are fixed annually
by Congress in the General Appropriations Act.[26] An LGU is obviously not a national agency. Its annual budget is fixed by
its own legislative council (Sangguniang Bayan, Panlungsod or Panlalawigan), not by Congress. Without doubt, NCC No.
67 does not apply to LGUs.
The prohibition in NCC No. 67 is in fact an administrative tool of the DBM to prevent the much-abused practice of
multiple allowances, thus standardizing the grant of RATA by national agencies. Thus, the purpose clause of NCC No. 67
reads:
This Circular is being issued to ensure uniformity and consistency of actions on claims for representation and
transportation allowance (RATA) which is primarily granted by law to national government officials and employees to
cover expenses incurred in the discharge or performance of their duties and responsibilities.

By no stretch of the imagination can NCC No. 67 be construed as nullifying the power of LGUs to grant allowances
to judges under the Local Government Code of 1991. It was issued primarily to make the grant of RATA to national
officials under the national budget uniform. In other words, it applies only to the national funds administered by the
DBM, not the local funds of LGUs.
To rule against the power of LGUs to grant allowances to judges as what respondent COA would like us to do will
subvert the principle of local autonomy zealously guaranteed by the Constitution.[27] The Local Government Code of
1991 was specially promulgated by Congress to ensure the autonomy of local governments as mandated by the
Constitution. By upholding, in the present case, the power of LGUs to grant allowances to judges and leaving to their
discretion the amount of allowances they may want to grant, depending on the availability of local funds, we ensure the
genuine and meaningful local autonomy of LGUs.
We now discuss the next contention of respondent COA: that the resolution of
the Sangguniang Bayan of Naujan granting the P1,600 monthly allowance to petitioner judge was null and void because
it failed to comply with LBC No. 53 dated September 1, 1993:
Sec. 3 Allowances. ─ LGUs may grant allowances/additional compensation to the national government
officials/employees assigned to their locality at rates authorized by law, rules and regulations and subject to the
following preconditions:

a. That the annual income or finances of the municipality, city or province as certified by the Accountant
concerned will allow the grant of the allowances/additional compensation without exceeding the
general limitations for personal services under Section 325 of RA 7160;
b. That the budgetary requirements under Section 324 of RA 7160 including the full requirement of RA 6758
have been satisfied and provided fully in the budget as certified by the Budget Officer and COA
representative in the LGU concerned;
c. That the LGU has fully implemented the devolution of personnel/functions in accordance with the provisions
of RA 7160;
d. That the LGU has already created mandatory positions prescribed in RA 7160.
e. That similar allowances/additional compensation are not granted by the national government to the
officials/employees assigned to the LGU.

Though LBC No. 53 of the DBM may be considered within the ambit of the President's power of general supervision
over LGUs,[28] we rule that Section 3, paragraph (e) thereof is invalid. RA 7160, the Local Government Code of 1991,
clearly provides that provincial, city and municipal governments may grant allowances to judges as long as their finances
allow. Section 3, paragraph (e) of LBC No. 53, by outrightly prohibiting LGUs from granting allowances to judges
whenever such allowances are (1) also granted by the national government or (2) similar to the allowances granted by
the national government, violates Section 447(a)(l)(xi) of the Local Government Code of 1991.[29] As already stated, a
circular must conform to the law it seeks to implement and should not modify or amend it.[30]
Moreover, by prohibiting LGUs from granting allowances similar to the allowances granted by the national
government, Section 3 (e) of LBC No. 53 practically prohibits LGUs from granting allowances to judges and, in effect,
totally nullifies their statutory power to do so. Being unduly restrictive therefore of the statutory power of LGUs to grant
allowances to judges and being violative of their autonomy guaranteed by the Constitution, Section 3, paragraph (e) of
LBC No. 53 is hereby declared null and void.
Paragraphs (a) to (d) of said circular, however, are valid as they are in accordance with Sections 324[31] and 325[32] of
the Local Government Code of 1991; these respectively provide for the budgetary requirements and general limitations
on the use of provincial, city and municipal funds. Paragraphs (a) to (d) are proper guidelines for the condition provided
in Sections 447, 458 and 468 of the Local Government Code of 1991 that LGUs may grant allowances to judges if their
funds allow.[33]
Respondent COA also argues that Resolution No. 101 of the Sangguniang Bayan of Naujan failed to comply with
paragraphs (a) to (d) of LBC No. 53, thus it was null and void.
The argument is misplaced.
Guidelines (a) to (d) were met when the Sangguniang Panlalawigan of Oriental Mindoro approved Resolution No.
101 of the Sangguniang Bayan of Naujan granting the P1,600 monthly allowance to petitioner judge as well as the
corresponding budgets of the municipality providing for the said monthly allowance to petitioner judge. Under Section
327 of the Local Government Code of 1991, the Sangguniang Panlalawigan was specifically tasked to review the
appropriation ordinances of its component municipalities to ensure compliance with Sections 324 and 325 of the Code.
Considering said duty of the SangguniangPanlalawigan, we will assume, in the absence of proof to the contrary, that
the Sangguniang Panlalawigan of Oriental Mindoroperformed what the law required it to do, that is, review the
resolution and the corresponding budgets of the Municipality of Naujan to make sure that they complied with Sections
324 and 325 of the Code.[34] We presume the regularity of the Sangguniang Panlalawigans official act.
Moreover, it is well-settled that an ordinance must be presumed valid in the absence of evidence showing that it is
not in accordance with the law.[35] Respondent COA had the burden of proving that Resolution No. 101 of
the Sangguniang Bayan of Naujan did not comply with the condition provided in Section 447 of the Code, the budgetary
requirements and general limitations on the use of municipal funds provided in Sections 324 and 325 of the Code and
the implementing guidelines issued by the DBM, i.e., paragraphs (a) to (d), Section 3 of LBC No. 53. Respondent COA also
had the burden of showing that the Sangguniang Panlalawigan of Oriental Mindoro erroneously approved said
resolution despite its non-compliance with the requirements of the law. It failed to discharge such burden. On the
contrary, we find that the resolution of the Municipality of Naujan granting the P1,600 monthly allowance to petitioner
judge fully complied with the law. Thus, we uphold its validity.
In sum, we hereby affirm the power of the Municipality of Naujan to grant the questioned allowance to petitioner
Judge Leynes in accordance with the constitutionally mandated policy of local autonomy and the provisions of the Local
Government Code of 1991. We also sustain the validity of Resolution No. 101, Series of 1993, of
the Sangguniang Bayan of Naujan for being in accordance with the law.
WHEREFORE, the petition is hereby GRANTED. The assailed decision dated September 14, 1999 of the Commission
of Audit is hereby SET ASIDE and Section 3, paragraph (e) of LBC No. 53 is hereby declared NULL and VOID.
No costs.
SO ORDERED.
Davide, Jr., C.J., Puno, Vitug, Panganiban, Quisumbing, Ynares-Santiago, Sandoval-Gutierrez, Carpio, Austria-
Martinez, Carpio-Morales, Callejo, Sr., Azcuna, and Tinga, JJ., concur.
[G.R. No. 146319. October 26, 2001]
BENJAMIN E. CAWALING, JR., petitioner, vs. THE COMMISSION ON ELECTIONS, and Rep. Francis Joseph G.
Escudero, respondents.
[G.R. No. 146342. October 26, 2001]
BENJAMIN E. CAWALING, JR., petitioner, vs. THE EXECUTIVE SECRETARY TO THE PRESIDENT OF THE REPUBLIC OF THE
PHILIPPINES, SECRETARY OF THE INTERIOR AND LOCAL GOVERNMENT, SECRETARY OF THE DEPARTMENT OF BUDGET
AND MANAGEMENT, SOLICITOR GENERAL, PROVINCE OF SORSOGON, MUNICIPALITY OF SORSOGON, MUNICIPALITY
OF BACON, respondents.
DECISION
SANDOVAL-GUTIERREZ, J.:
Before us are two (2) separate petitions challenging the constitutionality of Republic Act No. 8806 which created the City
of Sorsogon and the validity of the plebiscite conducted pursuant thereto.
On August 16, 2000, former President Joseph E. Estrada signed into law R.A. No. 8806, an Act Creating The City Of
Sorsogon By Merging The Municipalities Of Bacon And Sorsogon In The Province Of Sorsogon, And Appropriating Funds
Therefor.[1]
Pursuant to Section 10, Article X of the Constitution,[2] the Commission on Elections (COMELEC), on December 16, 2000,
conducted a plebiscite in the Municipalities of Bacon and Sorsogon and submitted the matter for ratification.
On December 17, 2000, the Plebiscite City Board of Canvassers (PCBC) proclaimed[3] the creation of the City of Sorsogon
as having been ratified and approved by the majority of the votes cast in the plebiscite.[4]
Invoking his right as a resident and taxpayer of the former Municipality of Sorsorgon, Benjamin E. Cawaling, Jr. filed on
January 2, 2001 the present petition for certiorari (G.R. No. 146319) seeking the annulment of the plebiscite on the
following grounds:
A. The December 16, 2000 plebiscite was conducted beyond the required 120-day period from the approval of R.A.
8806, in violation of Section 54 thereof; and
B. Respondent COMELEC failed to observe the legal requirement of twenty (20) day extensive information campaign in
the Municipalities of Bacon and Sorsogon before conducting the plebiscite.
Two days after filing the said action, or on January 4, 2001, petitioner instituted another petition (G.R. No. 146342), this
time for prohibition, seeking to enjoin the further implementation of R.A. No. 8806 for being unconstitutional,
contending, in essence, that:
1. The creation of Sorsogon City by merging two municipalities violates Section 450(a) of the Local Government Code of
1991 (in relation to Section 10, Article X of the Constitution) which requires that only a municipality or a cluster of
barangays may be converted into a component city; and
2. R.A. No. 8806 contains two (2) subjects, namely, the (a) creation of the City of Sorsogon and the (b) abolition of the
Municipalities of Bacon and Sorsogon, thereby violating the one subject-one bill rule prescribed by Section 26(1), Article
VI of the Constitution.
Hence, the present petitions which were later consolidated.[5]
Significantly, during the pendency of these cases, specifically during the May 14, 2001 elections, the newly-created
Sorsogon City had the first election of its officials. Since then, the City Government of Sorsogon has been regularly
discharging its corporate and political powers pursuant to its charter, R.A. No. 8806.
We shall first delve on petitioners constitutional challenge against R.A. No. 8806 in G.R. No. 146342.
Every statute has in its favor the presumption of constitutionality.[6] This presumption is rooted in the doctrine of
separation of powers which enjoins upon the three coordinate departments of the Government a becoming courtesy for
each others acts.[7] The theory is that every law, being the joint act of the Legislature and the Executive, has passed
careful scrutiny to ensure that it is in accord with the fundamental law.[8] This Court, however, may declare a law, or
portions thereof, unconstitutional, where a petitioner has shown a clear and unequivocal breach of the Constitution, not
merely a doubtful or argumentative one.[9] In other words, the grounds for nullity must be beyond reasonable
doubt,[10] for to doubt is to sustain.[11]
Petitioner initially rejects R.A. No. 8806 because it violates Section 10, Article X of the Constitution which provides, inter
alia:
Section 10. No province, city, municipality, or barangay may be created, divided, merged, abolished, or its boundary
substantially altered, except in accordance with the criteria established in the local government code and subject to
approval by a majority of the votes cast in a plebiscite in the political units directly affected. (Emphasis ours)
The criteria for the creation of a city is prescribed in Section 450 of the Local Government Code of 1991 (the Code), thus:
Section 450. Requisites for Creation. (a) A municipality or a cluster of barangays may be converted into a component city
if it has an average annual income, as certified by the Department of Finance, of at least Twenty million
(P20,000,000.00) for the last two (2) consecutive years based on 1991 constant prices, and if it has either of the
following requisites:
(i) a contiguous territory of at least one hundred (100) square kilometers, as certified by the Lands Management Bureau;
or
(ii) a population of not less than one hundred fifty thousand (150,000) inhabitants, as certified by the National Statistics
Office:
Provided, That, the creation thereof shall not reduce the land area, population, and income of the original unit or units
at the time of said creation to less than the minimum requirements prescribed herein.
(b) The territorial jurisdiction of a newly-created city shall be properly identified by metes and bounds. The requirement
on land area shall not apply where the city proposed to be created is composed of one (1) or more islands. The territory
need not be contiguous if it comprises two (2) or more islands.
(c) The average annual income shall include the income accruing to the general fund, exclusive of specific funds,
transfers, and non-recurring income. (Emphasis ours)
Petitioner is not concerned whether the creation of Sorsogon City through R.A. No. 8806 complied with the criteria set
by the Code as to income, population and land area. What he is assailing is its mode of creation. He contends that under
Section 450(a) of the Code, a component city may be created only by converting a municipality or a cluster of barangays,
not by merging two municipalities, as what R.A. No. 8806 has done.
This contention is devoid of merit.
Petitioners constricted reading of Section 450(a) of the Code is erroneous. The phrase A municipality or a cluster
of barangays may be converted into a component city is not a criterion but simply one of the modes by which a city may
be created. Section 10, Article X of the Constitution, quoted earlier and which petitioner cited in support of his posture,
allows the merger of local government units to create a province, city, municipality or barangay in accordance with the
criteria established by the Code. Thus, Section 8 of the Code distinctly provides:
Section 8. Division and Merger. Division and merger of existing local government units shall comply with the same
requirements herein prescribed for their creation: Provided, however, That such division shall not reduce the income,
population, or land area of the local government unit or units concerned to less than the minimum requirements
prescribed in this Code: Provided, further, That the income classification of the original local government unit or units
shall not fall below its current income classification prior to such division. x x x. (Emphasis ours)
Verily, the creation of an entirely new local government unit through a division or a merger of existing local government
units is recognized under the Constitution, provided that such merger or division shall comply with the requirements
prescribed by the Code.
Petitioner further submits that, in any case, there is no compelling reason for merging the Municipalities of Bacon and
Sorsogon in order to create the City of Sorsogon considering that the Municipality of Sorsogon alone already qualifies to
be upgraded to a component city. This argument goes into the wisdom of R.A. No. 8806, a matter which we are not
competent to rule. In Angara v. Electoral Commission,[12] this Court, through Justice Jose P. Laurel, made it clear that
the judiciary does not pass upon questions of wisdom, justice or expediency of legislation. In the exercise of judicial
power, we are allowed only to settle actual controversies involving rights which are legally demandable and
enforceable,[13] and may not annul an act of the political departments simply because we feel it is unwise or
impractical.[14]
Next, petitioner assails R.A. No. 8806 since it contravenes the one subject-one bill rule enunciated in Section 26 (1),
Article VI of the Constitution, to wit:
Section 26 (1). Every bill passed by the Congress shall embrace only one subject which shall be expressed in the title
thereof. (emphasis ours)
Petitioner contends that R.A. No. 8806 actually embraces two principal subjects which are: (1) the creation of the City of
Sorsogon, and (2) the abolition of the Municipalities of Bacon and Sorsogon. While the title of the Act sufficiently
informs the public about the creation of Sorsogon City, petitioner claims that no such information has been provided on
the abolition of the Municipalities of Bacon and Sorsogon.
The argument is far from persuasive. Contrary to petitioners assertion, there is only one subject embraced in the title of
the law, that is, the creation of the City of Sorsogon. The abolition/cessation of the corporate existence of the
Municipalities of Bacon and Sorsogon due to their merger is not a subject separate and distinct from the creation of
Sorsogon City. Such abolition/cessation was but the logical, natural and inevitable consequence of the
merger. Otherwise put, it is the necessary means by which the City of Sorsogon was created. Hence, the title of the law,
An Act Creating the City of Sorsogon by Merging the Municipalities of Bacon and Sorsogon in the Province of Sorsogon,
and Appropriating Funds Therefor, cannot be said to exclude the incidental effect of abolishing the two municipalities,
nor can it be considered to have deprived the public of fair information on this consequence.
It is well-settled that the one title-one subject rule does not require the Congress to employ in the title of the enactment
language of such precision as to mirror, fully index or catalogue all the contents and the minute details therein.[15] The
rule is sufficiently complied with if the title is comprehensive enough as to include the general object which the statute
seeks to effect,[16] and where, as here, the persons interested are informed of the nature, scope and consequences of
the proposed law and its operation.[17] Moreover, this Court has invariably adopted a liberal rather than technical
construction of the rule so as not to cripple or impede legislation.[18]
Consequently, we hold that petitioner has failed to present clear and convincing proof to defeat the presumption of
constitutionality of R.A. No. 8806.
We now turn to G.R. No. 146319 wherein petitioner assails the validity of the plebiscite conducted by the COMELEC for
the ratification of the creation of Sorsogon City.
Petitioner asserts that the plebiscite required by R.A. No. 8806 should be conducted within 120 days from the approval
of said Act per express provision of its Section 54, viz:
Sec. 54. Plebiscite. The City of Sorsogon shall acquire corporate existence upon the ratification of its creation by a
majority of the votes cast by the qualified voters in a plebiscite to be conducted in the present municipalities of Bacon
and Sorsogon within one hundred twenty (120) days from the approval of this Act. x x x. (Emphasis ours)
The Act was approved on August 16, 2000 by former President Joseph E. Estrada. Thus, petitioner claims, the December
16, 2000 plebiscite was conducted one (1) day late from the expiration of the 120-day period after the approval of the
Act. This 120-day period having expired without a plebiscite being conducted, the Act itself expired and could no longer
be ratified and approved in the plebiscite held on December 16, 2000.
In its comment, the COMELEC asserts that it scheduled the plebiscite on December 16, 2000 based on the date of the
effectivity of the Act. Section 65 of the Act states:
Sec. 65. Effectivity. - This Act shall take effect upon its publication in at least two (2) newspapers of general and local
circulation.
The law was first published in the August 25, 2000 issue of TODAY, a newspaper of general circulation. Then on
September 01, 2000, it was published in a newspaper of local circulation in the Province of Sorsogon. Thus, the
publication of the law was completed on September 1, 2000, which date, according to the COMELEC, should be the
reckoning point in determining the 120-day period within which to conduct the plebiscite, not from the date of its
approval (August 16, 2000) when the law had not yet been published. The COMELEC argues that since publication is
indispensable for the effectivity of a law, citing the landmark case of Taada vs. Tuvera,[19] it could only schedule the
plebiscite after the Act took effect. Thus, the COMELEC concludes, the December 16, 2000 plebiscite was well within the
120-day period from the effectivity of the law on September 1, 2000.
The COMELEC is correct.
In addition, Section 10 of the Code provides:
Section 10. Plebiscite Requirement. No creation, division, merger, abolition, or substantial alteration of boundaries of
local government units shall take effect unless approved by a majority of the votes cast in a plebiscite called for the
purpose in the political unit or units directly affected. Such plebiscite shall be conducted by the Commission on Elections
within one hundred twenty (120) days from the date of the effectivity of the law or ordinance affecting such
action, unless said law or ordinance fixes another date. (Emphasis ours)
Quite plainly, the last sentence of Section 10 mandates that the plebiscite shall be conducted within 120 days from the
date of the effectivity of the law, not from its approval. While the same provision allows a law or ordinance to fix
another date for conducting a plebiscite, still such date must be reckoned from the date of the effectivity of the law.
Consequently, the word approval in Section 54 of R.A. No. 8806, which should be read together with Section 65
(effectivity of the Act) thereof, could only mean effectivity as used and contemplated in Section 10 of the Code. This
construction is in accord with the fundamental rule that all provisions of the laws relating to the same subject should be
read together and reconciled to avoid inconsistency or repugnancy to established jurisprudence. As we stated in Taada:
Art. 2. Laws shall take effect after fifteen days following the completion of their publication in the Official Gazette, unless
it is otherwise provided. This Code shall take effect one year after such publication.
After a careful study of this provision and of the arguments of the parties, both on the original petition and on the
instant motion, we have come to the conclusion, and so hold, that the clause unless it is otherwise provided refers to
the date of effectivity and not to the requirement of publication itself, which cannot in any event be omitted. This clause
does not mean that the legislature may make the law effective immediately upon approval, or on any other date,
without its previous publication. (Emphasis supplied)
To give section 54 a literal and strict interpretation would in effect make the Act effective even before its publication,
which scenario is precisely abhorred in Taada.
Lastly, petitioner alleges that the COMELEC failed to conduct an extensive information campaign on the proposed
Sorsogon cityhood 20 days prior to the scheduled plebiscite as required by Article 11 (b.4.ii), Rule II of the Rules and
Regulations Implementing the Code. However, no proof whatsoever was presented by petitioner to substantiate his
allegation. Consequently, we sustain the presumption[20] that the COMELEC regularly performed or complied with its
duty under the law in conducting the plebiscite.
WHEREFORE, the instant petitions are DISMISSED for lack of merit. Costs against petitioner.
SO ORDERED.
Davide, Jr., C.J., Bellosillo, Melo, Puno, Kapunan, Mendoza, Panganiban, Quisumbing, Pardo, Buena, Ynares-
Santiago, and De Leon, Jr., JJ., concur.
Vitug, J., on official leave.
G.R. No. 169435 February 27, 2008
MUNICIPALITY OF NUEVA ERA, ILOCOS NORTE, represented by its Municipal Mayor, CAROLINE ARZADON-
GARVIDA, petitioner,
vs.
MUNICIPALITY OF MARCOS, ILOCOS NORTE, represented by its Municipal Mayor, SALVADOR PILLOS, and the
HONORABLE COURT OF APPEALS, respondents.
DECISION
REYES, R.T., J.:
AS the law creating a municipality fixes its boundaries, settlement of boundary disputes between municipalities is
facilitated by carrying into effect the law that created them.
Any alteration of boundaries that is not in accordance with the law creating a municipality is not the carrying into effect
of that law but its amendment, which only the Congress can do.1
For Our review on certiorari is the Decision2 of the Court of Appeals (CA) reversing to a certain extent that3 of the
Regional Trial Court (RTC), Branch 12, Laoag City, Ilocos Norte, in a case that originated from the Sangguniang
Panlalawigan (SP) of Ilocos Norte about the boundary dispute between the Municipalities of Marcos and Nueva Era in
Ilocos Norte.
The CA declared that Marcos is entitled to have its eastern boundary extended up "to the boundary line between the
province of Ilocos Norte and Kalinga-Apayao."4 By this extension of Marcos' eastern boundary, the CA allocated to
Marcos a portion of Nueva Era's territory.
The Facts
The Municipality of Nueva Era was created from the settlements of Bugayong, Cabittaoran, Garnaden, Padpadon,
Padsan, Paorpatoc, Tibangran, and Uguis which were previously organized as rancherias, each of which was under the
independent control of a chief. Governor General Francis Burton Harrison, acting on a resolution passed by the
provincial government of Ilocos Norte, united these rancherias and created the township of Nueva Era by virtue of
Executive Order (E.O.) No. 66 5 dated September 30, 1916.
The Municipality of Marcos, on the other hand, was created on June 22, 1963 pursuant to Republic Act (R.A.) No. 3753
entitled "An Act Creating the Municipality of Marcos in the Province of Ilocos Norte." Section 1 of R.A. No. 3753
provides:
SECTION 1. The barrios of Capariaan, Biding, Escoda, Culao, Alabaan, Ragas and Agunit in the Municipality of Dingras,
Province of Ilocos Norte, are hereby separated from the said municipality and constituted into a new and separate
municipality to be known as the Municipality of Marcos, with the following boundaries:
On the Northwest, by the barrios Biding-Rangay boundary going down to the barrios Capariaan-Gabon boundary
consisting of foot path and feeder road; on the Northeast, by the Burnay River which is the common boundary of barrios
Agunit and Naglayaan; on the East, by the Ilocos Norte-Mt. Province boundary; on the South, by the Padsan River which
is at the same time the boundary between the municipalities of Banna and Dingras; on the West and Southwest, by the
boundary between the municipalities of Batac and Dingras.
The Municipality of Marcos shall have its seat of government in the barrio of Biding.
Based on the first paragraph of the said Section 1 of R.A. No. 3753, it is clear that Marcos shall be derived from the
listed barangays of Dingras, namely: Capariaan, Biding, Escoda, Culao, Alabaan, Ragas and Agunit. The Municipality of
Nueva Era or any of its barangays was not mentioned. Hence, if based only on said paragraph, it is clear that Nueva Era
may not be considered as a source of territory of Marcos.
There is no issue insofar as the first paragraph is concerned which named only Dingras as the mother municipality of
Marcos. The problem, however, lies in the description of Marcos' boundaries as stated in the second paragraph,
particularly in the phrase: "on the East, by the Ilocos Norte-Mt. Province boundary."
It must be noted that the term "Mt. Province" stated in the above phrase refers to the present adjoining provinces of
Benguet, Mountain Province, Ifugao, Kalinga and Apayao, which were then a single province.
Mt. Province was divided into the four provinces of Benguet, Mountain Province, Ifugao, and Kalinga-Apayao by virtue of
R.A. No. 4695 which was enacted on June 18, 1966. On February 14, 1995, the province of Kalinga-Apayao, which
comprises the sub-provinces of Kalinga and Apayao, was further converted into the regular provinces of Kalinga and
Apayao pursuant to R.A. No. 7878.
The part of then Mt. Province which was at the east of Marcos is now the province of Apayao. Hence, the eastern
boundary referred to by the second paragraph of Section 1 of R.A. No. 3753 is the present Ilocos Norte-Apayao
boundary.
On the basis of the said phrase, which described Marcos' eastern boundary, Marcos claimed that the middle portion of
Nueva Era, which adjoins its eastern side, formed part of its territory. Its reasoning was founded upon the fact that
Nueva Era was between Marcos and the Ilocos Norte-Apayao boundary such that if Marcos was to be bounded on the
east by the Ilocos Norte-Apayao boundary, part of Nueva Era would consequently be obtained by it.6
Marcos did not claim any part of Nueva Era as its own territory until after almost 30 years,7 or only on March 8, 1993,
when its Sangguniang Bayan passed Resolution No. 93-015.8 Said resolution was entitled: "Resolution Claiming an Area
which is an Original Part of Nueva Era, But Now Separated Due to the Creation of Marcos Town in the Province of Ilocos
Norte."
Marcos submitted its claim to the SP of Ilocos Norte for its consideration and approval. The SP, on the other hand,
required Marcos to submit its position paper.9
In its position paper, Marcos alleged that since its northeastern and eastern boundaries under R.A. No. 3753 were the
Burnay River and the Ilocos Norte-Mountain Province boundary, respectively, its eastern boundary should not be limited
to the former Dingras-Nueva Era boundary, which was coterminous and aligned with the eastern boundary of Dingras.
According to Marcos, its eastern boundary should extend further to the east or up to the Ilocos-Norte-Mt. Province
boundary pursuant to the description of its eastern boundary under R.A. No. 3753.10
In view of its claim over the middle portion of Nueva Era, Marcos posited that Nueva Era was cut into two parts. And
since the law required that the land area of a municipality must be compact and contiguous, Nueva Era's northern
isolated portion could no longer be considered as its territory but that of Marcos'. Thus, Marcos claimed that it was
entitled not only to the middle portion11 of Nueva Era but also to Nueva Era's isolated northern portion. These areas
claimed by Marcos were within Barangay Sto. Niño, Nueva Era.
Nueva Era reacted to the claim of Marcos through its Resolution No. 1, Series of 1993. It alleged that since time
immemorial, its entire land area was an ancestral domain of the "tinguians," an indigenous cultural community. It
argued to the effect that since the land being claimed by Marcos must be protected for the tinguians, it must be
preserved as part of Nueva Era.12
According to Nueva Era, Marcos was created out of the territory of Dingras only. And since R.A. No. 3753 specifically
mentioned seven (7) barrios of Dingras to become Marcos, the area which should comprise Marcos should not go
beyond the territory of said barrios.13
From the time Marcos was created in 1963, its eastern boundary had been considered to be aligned and coterminous
with the eastern boundary of the adjacent municipality of Dingras. However, based on a re-survey in 1992, supposedly
done to conform to the second paragraph of Section 1 of R.A. No. 3753, an area of 15,400 hectares of Nueva Era was
alleged to form part of Marcos.14 This was the area of Barangay Sto. Niño, Nueva Era that Marcos claimed in its position
paper.
On March 29, 2000, the SP of Ilocos Norte ruled in favor of Nueva Era. The fallo of its decision15 reads:
WHEREFORE, in view of all the foregoing, this Body has no alternative but to dismiss, as it hereby DISMISSES said
petition for lack of merit. The disputed area consisting of 15,400 hectares, more or less, is hereby declared as part and
portion of the territorial jurisdiction of respondent Nueva Era.16
R.A. No. 3753 expressly named the barangays that would comprise Marcos, but none of Nueva Era's barangayswere
mentioned. The SP thus construed, applying the rule of expressio unius est exclusio alterius, that no part of Nueva Era
was included by R.A. No. 3753 in creating Marcos.17
The SP ratiocinated that if Marcos was to be bounded by Mt. Province, it would encroach upon a portion, not only of
Nueva Era but also of Abra. Thus:
x x x Even granting, for the sake of argument, that the eastern boundary of Marcos is indeed Mountain Province, Marcos
will then be claiming a portion of Abra because the province, specifically Barangay Sto. Niño, Nueva Era, is actually
bounded on the East by the Province of Abra. Abra is situated between and separates the Provinces of Ilocos Norte and
Mountain Province.
This is precisely what this body would like to avoid. Statutes should be construed in the light of the object to be achieved
and the evil or mischief to be suppressed, and they should be given such construction as will advance the object,
suppress the mischief and secure the benefits intended.18 (Citations omitted)
The SP further explained:
Invariably, it is not the letter, but the spirit of the law and the intent of the legislature that is important. When the
interpretation of the statute according to the exact and literal import of its words would lead to absurdity, it should be
construed according to the spirit and reason, disregarding if necessary the letters of the law. It is believed that congress
did not intend to have this absurd situation to be created when it created the Municipality of Marcos. This body, by the
mandate given to it by the RA 7160 otherwise known Local Government Code, so believes that respondent Nueva Era or
any portion thereof has been excluded from the ambit of RA 3753. Under the principle of "espressio (sic) unios (sic) est
exclusio alterius," by expressly naming the barangays that will comprise the town of Marcos, those not mentioned are
deemed excluded. In Republic Act 4354, where Section 2 thereof enumerated the barrios comprising the City of Davao
excluding the petitioner Barrio Central as part of the said City, the court held that there arose a prima facie conclusion
that the said law abolished Barrio Central as part of Davao City.
Historically, the hinterlands of Nueva Era have been known to be the home of our brothers and sisters belonging to
peculiar groups of non-(C)hristian inhabitants with their own rich customs and traditions and this body takes judicial
notice that the inhabitants of Nueva Era have proudly claimed to be a part of this rich culture. With this common
ancestral heritage which unfortunately is absent with Marcos, let it not be disturbed.19 (Emphasis ours and citations
omitted)
RTC Decision
On appeal by Marcos, the RTC affirmed the decision of the SP in its decision20 of March 19, 2001. The dispositive part of
the RTC decision reads:
WHEREFORE, the instant appeal is hereby DISMISSED. The questioned decision of the Sangguniang Panlalawigan of
Ilocos Norte is hereby AFFIRMED.
No costs.
SO ORDERED.21
The RTC reasoned out in this wise:
The position of the Municipality of Marcos is that the provision of R.A. 3753 as regards its boundary on the East which is
the "Ilocos Norte-Mt. Province" should prevail.
On the other hand, the Municipality of Nueva Era posits the theory that only the barrios of the Municipality of Dingras as
stated in R.A. 3753 should be included in the territorial jurisdiction of the Municipality of Marcos. The Sangguniang
Panlalawigan agreed with the position of Nueva Era.
xxxx
An examination of the Congressional Records during the deliberations of the R.A. 3753 (House Bill No. 3721) shows the
Explanatory Note of Congressman Simeon M. Valdez, 2nd District, Ilocos Norte, to wit:
EXPLANATORY NOTE
This bill seeks to create in the Province of Ilocos Norte a new municipality to be known as the Municipality of Marcos, to
be comprised by the present barrios of Capariaan, Biding Escoda, Culao, Alabaan, Ragas and Agunit, all in the
Municipality of Dingras of the same province. The seat of government will be in the sitio of San Magro in the present
barrio of Ragas.
xxxx
On the other hand, the Municipality of Dingras will not be adversely affected too much because its finances will still be
sound and stable. Its capacity to comply with its obligations, especially to its employees and personnel, will not be
diminished nor its operations paralyzed. On the contrary, economic development in both the mother and the proposed
municipalities will be accelerated.
In view of the foregoing, approval of this bill is earnestly requested.
(Sgd.) SIMEON M. VALDEZ
Congressman, 2nd District
Ilocos Norte22
Parenthetically, the legislative intent was for the creation of the Municipality of Marcos, Ilocos Norte from the barrios
(barangays) of the Municipality of Dingras, Ilocos Norte only. Hence, the Municipality of Marcos cannot add any area
beyond the territorial jurisdiction of the Municipality of Dingras, Ilocos Norte. This conclusion might have been different
only if the area being claimed by the Municipality of Marcos is within the territorial jurisdiction of the Municipality of
Dingras and not the Municipality of Nueva Era. In such case, the two conflicting provisions may be harmonized by
including such area within the territorial jurisdiction of the Municipality of Dingras as within the territorial jurisdiction of
the Municipality of Marcos.23 (Emphasis ours)
CA Disposition
Still determined to have a more extensive eastern boundary, Marcos filed a petition for review24 of the RTC decision
before the CA. The issues raised by Marcos before the CA were:
1. Whether or not the site of Hercules Minerals and Oil, Inc. which is within a Government Forest Reservation
in Barangay Sto. Niño, formerly of Nueva Era, is a part of the newly created Municipality of Marcos, Ilocos Norte.
2. Whether or not the portion of Barangay Sto. Niño on the East which is separated from Nueva Era as a result of the full
implementation of the boundaries of the new Municipality of Marcos belongs also to Marcos or to Nueva Era.25
The twin issues involved two portions of Nueva Era, viz.: (1) middle portion, where Hercules Minerals and Oil, Inc. is
located; and (2) northern portion of Nueva Era, which, according to Marcos, was isolated from Nueva Era in view of the
integration to Marcos of said middle portion.
Marcos prayed before the CA that the above two portions of Nueva Era be declared as part of its own territory. It
alleged that it was entitled to the middle portion of Nueva Era in view of the description of Marcos' eastern boundary
under R.A. No. 3753. Marcos likewise contended that it was entitled to the northern portion of Nueva Era which was
allegedly isolated from Nueva Era when Marcos was created. It posited that such isolation of territory was contrary to
law because the law required that a municipality must have a compact and contiguous territory.26
In a Decision27 dated June 6, 2005, the CA partly reversed the RTC decision with the following disposition:
WHEREFORE, we partially GRANT the petition treated as one for certiorari. The Decisions of both the Sangguniang
Panlalawigan and Regional Trial Court of Ilocos Norte are REVERSED and SET ASIDEinsofar as they made the eastern
boundary of the municipality of Marcos co-terminous with the eastern boundary of Dingras town, and another is
rendered extending the said boundary of Marcos to the boundary line between the province of Ilocos Norte and Kalinga-
Apayao, but the same Decisions are AFFIRMED with respect to the denial of the claim of Marcos to the detached
northern portion of barangay Sto. Niño which should, as it is hereby ordered to, remain with the municipality of Nueva
Era. No costs.
SO ORDERED.28
In concluding that the eastern boundary of Marcos was the boundary line between Ilocos Norte and Kalinga-Apayao, the
CA gave the following explanation:
Clearly then, both the SP and the RTC erred when they ruled that the eastern boundary of Marcos is only coterminous
with the eastern boundary of the adjacent municipality of Dingras and refused to extend it up to the boundary line
between the provinces of Ilocos Norte and Mountain Province (Kalinga-Apayao). R.A. No. 3753, the law creating Marcos,
is very explicit and leaves no room for equivocation that the boundaries of Marcos town are:
"On the Northwest by the barrios Biding-Rangay boundary going down to the barrios Capariaan-Gabon boundary
consisting of foot path and feeder road; on the Northeast, by the Burnay River which is the common boundary of barrios
Agunit and Naglayaan; on the East, by the Ilocos Norte-Mt. Province boundary; on the South by the Padsan River, which
is at the same time the boundary between the municipalities of Banna and Dingras; on the West and Southwest by the
boundary between the municipalities of Batac and Dingras."
To stop short at the eastern boundary of Dingras as the eastern boundary also of Marcos and refusing to go farther to
the boundary line between Ilocos Norte and Mountain Province (Kalinga-Apayao) is tantamount to amending the law
which Congress alone can do. Both the SP and RTC have no competence to undo a valid act of Congress.
It is not correct to say that Congress did not intend to take away any part of Nueva Era and merge it with Marcos for it is
chargeable with conclusive knowledge that when it provided that the eastern boundary of Marcos is the boundary line
between Ilocos Norte and Mountain Province, (by the time of both the SB and RTC Decision was already Kalinga-
Apayao), it would be cutting through a portion of Nueva Era. As the law is written so must it be applied. Dura lex sed
lex!29
The CA likewise held that the province Abra was not located between Marcos and Kalinga-Apayao; and that Marcos
would not encroach upon a portion of Abra for it to be bounded by Kalinga-Apayao, to wit:
Nueva Era's contention that to lay out the eastern jurisdiction of Marcos to the boundary line between Ilocos Norte and
Mountain Province (Kalinga-Apayao) would mean annexing part of the municipality of Itnig, province of Abra to Marcos
as Abra is between Ilocos Norte and Mountain Province is geographically erroneous. From Nueva Era's own map of
Region 1, which also depicts the locations of Kalinga-Apayao, Abra, Mountain Province, Benguet and Nueva Vizcaya after
the partition of the old Mountain Province into the provinces of Kalinga-Apayao, Ifugao, Mountain Province and
Benguet, the province of Abra is situated far to the south of Kalinga Apayao and is between the latter and the present
Mountain Province, which is farther south of Abra. Abra is part of the eastern boundary of Ilocos Sur while Kalinga-
Apayao is the eastern boundary of Ilocos Norte. Hence, in no way will the eastern boundary of the municipality of
Marcos encroach upon a portion of Abra.30
However, Marcos' claim over the alleged isolated northern portion of Nueva Era was denied. The CA ruled:
Going now to the other area involved, i.e., the portion of Sto. Niño that is separated from its mother town Nueva Era
and now lies east of the municipalities of Solsona and Dingras and north of Marcos, it bears stressing that it is not
included within the area of Marcos as defined by law. But since it is already detached from Sto. Niño, Marcos is
laying claim to it to be integrated into its territory by the SP because it is contiguous to a portion of said municipality.
We hold that the SP has no jurisdiction or authority to act on the claim, for it will necessarily substantially alter the north
eastern and southern boundaries of Marcos from that defined by law and unduly enlarge its area. Only Congress can do
that. True, the SP may substantially alter the boundary of a barangay within its jurisdiction. But this means the alteration
of the boundary of a barangay in relation to another barangay within the same municipality for as long as that will not
result in any change in the boundary of that municipality. The area in dispute therefore remains to be a part of Sto. Niño,
a barangay of Nueva Era although separated by the newly created Marcos town pursuant to Section 7(c) of the 1991
Local Government Code which states:
SEC. 7. Creation and Conversion. - As a general rule, the creation of a local government unit or its conversion from one
level to another shall be based on verifiable indicators of viability and projected capacity to provide services, to wit:
xxxx
(c) Land Area. - It must be contiguous, unless it comprises two or more islands or is separated by a local government unit
independent of the others; properly identified by metes and bounds with technical descriptions; and sufficient to
provide for such basic services and facilities to meet the requirements of its populace.31
The CA also expressed the view that Marcos adopted the wrong mode of appeal in bringing the case to it. The case,
according to the CA, was appealable only to the RTC. Nonetheless, despite its pronouncement that the case was
dismissible, the CA took cognizance of the same by treating it as one for certiorari, to wit:
A final word. At the outset, we agonized over the dilemma of choosing between dismissing outright the petition at bar
or entertaining it. This is for the simple reason that a petition for review is a mode of appeal and is not appropriate as
the Local Government Code provides for the remedy of appeal in boundary disputes only to the Regional Trial Court but
not any further appeal to this Court. Appeal is a purely statutory right. It cannot be exercised unless it is expressly
granted by law. This is too basic to require the citation of supporting authority.
xxxx
By the same token, since the Local Government Code does not explicitly grant the right of further appeal from decisions
of the RTCs in boundary disputes between or among local government units, Marcos town cannot exercise that right
from the adverse decision of the RTC of Ilocos Norte. Nonetheless, because of the transcendental legal and jurisdictional
issues involved, we solved our inceptive dilemma by treating the petition at bar as a special civil action for certiorari.32
Nueva Era was not pleased with the decision of the CA. Hence, this petition for review on certiorari under Rule 45.
Issues
Nueva Era now raises the following issues:
a) Whether or not, the Court of Appeals has jurisdiction on the Petition for Review on Appeal, since Sec. 119 of the Local
Government Code, which provides that "An appeal to the Decision of the Sangguniang Panlalawigan is exclusively vested
to the Regional Trial Court, without further Appeal to the Court of Appeals";
b) Whether or not, the Court of Appeals gravely abused its discretion, in treating the Petition for Review On Appeal, filed
under Rule 45, Revised Rules of Court, as a Petition for Certiorari, under Rule 65 of the Revised Rules of Court;
c) Whether or not, the Court of Appeals erred in its appreciation of facts, in declaring that MARCOS East is not
coterminous with the Eastern boundary of its mother town-Dingras. That it has no factual and legal basis to extend
MARCOS territory beyond Brgys. Agunit (Ferdinand) and Culao (Elizabeth) of Marcos, and to go further East, by
traversing and disintegrating Brgy. Sto. Niño, and drawing parallel lines from Sto. Niño, there lies Abra, not Mt. Province
or Kalinga-Apayao.33
Basically, there are two (2) issues to resolve here: (1) whether or not the mode of appeal adopted by Marcos in bringing
the case to the CA is proper; and (2) whether or not the eastern boundary of Marcos extends over and covers a portion
of Nueva Era.
Our Ruling
Marcos correctly appealed the RTC judgment via petition for review under Rule 42.
Under Section 118(b) of the Local Government Code, "(b)oundary disputes involving two (2) or more municipalities
within the same province shall be referred for settlement to the sangguniang panlalawigan concerned." The dispute
shall be formally tried by the said sanggunian in case the disputing municipalities fail to effect an amicable settlement.34
The SP of Ilocos validly took cognizance of the dispute between the parties. The appeal of the SP judgment to the RTC
was likewise properly filed by Marcos before the RTC. The problem, however, lies in whether the RTC judgment may still
be further appealed to the CA.
The CA pronounced that the RTC decision on the boundary dispute was not appealable to it. It ruled that no further
appeal of the RTC decision may be made pursuant to Section 119 of the Local Government Code35 which provides:
SECTION 119. Appeal. - Within the time and manner prescribed by the Rules of Court, any party may elevate the decision
of the sanggunian concerned to the proper Regional Trial Court having jurisdiction over the area in dispute. The Regional
Trial Court shall decide the appeal within one (1) year from the filing thereof. Pending final resolution of the disputed
area prior to the dispute shall be maintained and continued for all legal purposes.
The CA concluded that since only the RTC was mentioned as appellate court, the case may no longer be further appealed
to it. The CA stated that "(a)ppeal is a purely statutory right. It cannot be exercised unless it is expressly granted by law.
This is too basic to require the citation of supporting authority."36
The CA, however, justified its taking cognizance of the case by declaring that: "because of the transcendental legal and
jurisdictional issues involved, we solved our inceptive dilemma by treating the petition at bar as a special civil action
for certiorari."37
The CA erred in declaring that only the RTC has appellate jurisdiction over the judgment of the SP.
True, appeal is a purely statutory right and it cannot be exercised unless it is expressly granted by law. Nevertheless, the
CA can pass upon the petition for review precisely because the law allows it.
Batas Pambansa (B.P.) Blg. 129 or the Judiciary Reorganization Act of 1980, as amended by R.A. No. 7902,38vests in the
CA the appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of Regional Trial Courts
and quasi-judicial agencies, instrumentalities, boards or commissions, among others.39 B.P. Blg. 129 has been further
supplemented by the 1997 Rules of Civil Procedure, as amended, which provides for the remedy of appeal via petition
for review under Rule 42 to the CA in cases decided by the RTC in the exercise of its appellate jurisdiction.
Thus, the CA need not treat the appeal via petition for review filed by Marcos as a petition for certiorari to be able to
pass upon the same. B.P. Blg. 129, as amended, which is supplemented by Rule 42 of the Rules of Civil Procedure, gives
the CA the authority to entertain appeals of such judgments and final orders rendered by the RTC in the exercise of its
appellate jurisdiction.
At the time of creation of Marcos, approval in a plebiscite of the creation of a local government unit is not required.
Section 10, Article X of the 1987 Constitution provides that:
No province, city, municipality, or barangay may be created, divided, merged, abolished, or its boundary substantially
altered, except in accordance with the criteria established in the local government code and subject to approval by a
majority of the votes cast in a plebiscite in the political units directly affected.40
The purpose of the above constitutional provision was acknowledged by the Court through Justice Reynato S. Puno
in Miranda v. Aguirre,41 where it was held that:
The 1987 Constitution, more than any of our previous Constitutions, gave more reality to the sovereignty of our people
for it was borne out of the people power in the 1986 EDSA revolution. Its Section 10, Article X addressed the undesirable
practice in the past whereby local government units were created, abolished, merged or divided on the basis of the
vagaries of politics and not of the welfare of the people. Thus, the consent of the people of the local government unit
directly affected was required to serve as a checking mechanism to any exercise of legislative power creating, dividing,
abolishing, merging or altering the boundaries of local government units. It is one instance where the people in their
sovereign capacity decide on a matter that affects them - direct democracy of the people as opposed to democracy thru
people's representatives. This plebiscite requirement is also in accord with the philosophy of the Constitution granting
more autonomy to local government units.42
Nueva Era contends that the constitutional and statutory43 plebiscite requirement for the creation of a local
government unit is applicable to this case. It posits that the claim of Marcos to its territory should be denied due to lack
of the required plebiscite.
We agree with Nueva Era's contention that Marcos' claim over parts of its territory is not tenable. However, the reason
is not the lack of the required plebiscite under the 1987 and 1973 constitutions and the Local Government Code of 1991
but other reasons as will be discussed below.
At the time Marcos was created, a plebiscite was not required by law to create a local government unit. Hence, Marcos
was validly created without conducting a plebiscite. As a matter of fact, no plebiscite was conducted in Dingras, where it
was derived.
Lex prospicit, non respicit. The law looks forward, not backward.44 It is the basic norm that provisions of the
fundamental law should be given prospective application only, unless legislative intent for its retroactive application is
so provided.45
In the comparable case of Ceniza v. Commission on Elections46 involving the City of Mandaue, the Court has this to say:
Petitioners assail the charter of the City of Mandaue as unconstitutional for not having been ratified by the residents of
the city in a plebiscite. This contention is untenable. The Constitutional requirement that the creation, division, merger,
abolition, or alteration of the boundary of a province, city, municipality, or barrio should be subject to the approval by
the majority of the votes cast in a plebiscite in the governmental unit or units affected is a new requirement that came
into being only with the 1973 Constitution. It is prospective in character and therefore cannot affect the creation of the
City of Mandaue which came into existence on June 21, 1969.47 (Citations omitted and underlining supplied).
Moreover, by deciding this case, We are not creating Marcos but merely interpreting the law that created it. Its creation
was already a fait accompli. Therefore, there is no reason for Us to further require a plebiscite.
As pointed out by Justice Isagani Cruz, to wit:
Finally, it should be observed that the provisions of the Constitution should be given only a prospective application
unless the contrary is clearly intended. Were the rule otherwise, rights already acquired or vested might be unduly
disturbed or withdrawn even in the absence of an unmistakable intention to place them within the scope of the
Constitution.48
No part of Nueva Era's territory was taken for the creation of Marcos under R.A. No. 3753.
Only the barrios (now barangays) of Dingras from which Marcos obtained its territory are named in R.A. No. 3753. To
wit:
SECTION 1. The barrios of Capariaan, Biding, Escoda, Culao, Alabaan, Ragas and Agunit in the Municipality of Dingras,
Province of Ilocos Norte, are hereby separated from the said municipality and constituted into a new and separate
municipality to be known as the Municipality of Marcos, with the following boundaries:
Since only the barangays of Dingras are enumerated as Marcos' source of territory, Nueva Era's territory is, therefore,
excluded.
Under the maxim expressio unius est exclusio alterius, the mention of one thing implies the exclusion of another thing
not mentioned. If a statute enumerates the things upon which it is to operate, everything else must necessarily and by
implication be excluded from its operation and effect.49 This rule, as a guide to probable legislative intent, is based upon
the rules of logic and natural workings of the human mind.50
Had the legislature intended other barangays from Nueva Era to become part of Marcos, it could have easily done so by
clear and concise language. Where the terms are expressly limited to certain matters, it may not by interpretation or
construction be extended to other matters.51 The rule proceeds from the premise that the legislature would not have
made specified enumerations in a statute had the intention been not to restrict its meaning and to confine its terms to
those expressly mentioned.52
Moreover, since the barangays of Nueva Era were not mentioned in the enumeration of barangays out of which the
territory of Marcos shall be set, their omission must be held to have been done intentionally. This conclusion finds
support in the rule of casus omissus pro omisso habendus est, which states that a person, object or thing omitted from
an enumeration must be held to have been omitted intentionally.53
Furthermore, this conclusion on the intention of the legislature is bolstered by the explanatory note of the bill which
paved the way for the creation of Marcos. Said explanatory note mentioned only Dingras as the mother municipality of
Marcos.
Where there is ambiguity in a statute, as in this case, courts may resort to the explanatory note to clarify the ambiguity
and ascertain the purpose and intent of the statute.54
Despite the omission of Nueva Era as a mother territory in the law creating Marcos, the latter still contends that said law
included Nueva Era. It alleges that based on the description of its boundaries, a portion of Nueva Era is within its
territory.
The boundaries of Marcos under R.A. No. 3753 read:
On the Northwest, by the barrios Biding-Rangay boundary going down to the barrios Capariaan-Gabon boundary
consisting of foot path and feeder road; on the Northeast, by the Burnay River which is the common boundary of barrios
Agunit and Naglayaan; on the East, by the Ilocos Norte-Mt. Province boundary; on the South, by the Padsan River which
is at the same time the boundary between the municipalities of Banna and Dingras; on the West and Southwest, by the
boundary between the municipalities of Batac and Dingras.
Marcos contends that since it is "bounded on the East, by the Ilocos Norte-Mt. Province boundary," a portion of Nueva
Era formed part of its territory because, according to it, Nueva Era is between the Marcos and Ilocos Norte-Mt. Province
boundary. Marcos posits that in order for its eastern side to reach the Ilocos Norte-Mt. Province boundary, it will
necessarily traverse the middle portion of Nueva Era.
Marcos further claims that it is entitled not only to the middle portion of Nueva Era but also to its northern portion
which, as a consequence, was isolated from the major part of Nueva Era.
We cannot accept the contentions of Marcos.
Only Dingras is specifically named by law as source territory of Marcos. Hence, the said description of boundaries of
Marcos is descriptive only of the listed barangays of Dingras as a compact and contiguous territory.
Considering that the description of the eastern boundary of Marcos under R.A. No. 3753 is ambiguous, the same must
be interpreted in light of the legislative intent.
The law must be given a reasonable interpretation, to preclude absurdity in its application.55 We thus uphold the
legislative intent to create Marcos out of the territory of Dingras only.
Courts must give effect to the general legislative intent that can be discovered from or is unraveled by the four corners
of the statute, and in order to discover said intent, the whole statute, and not only a particular provision thereof, should
be considered.56 Every section, provision or clause of the statute must be expounded by reference to each other in
order to arrive at the effect contemplated by the legislature. The intention of the legislator must be ascertained from
the whole text of the law, and every part of the act is to be taken into view.57
It is axiomatic that laws should be given a reasonable interpretation, not one which defeats the very purpose for which
they were passed. This Court has in many cases involving the construction of statutes always cautioned against narrowly
interpreting a statute as to defeat the purpose of the legislature and stressed that it is of the essence of judicial duty to
construe statutes so as to avoid such a deplorable result (of injustice or absurdity) and that therefore "a literal
interpretation is to be rejected if it would be unjust or lead to absurd results."58
Statutes are to be construed in the light of the purposes to be achieved and the evils sought to be remedied. Thus, in
construing a statute, the reason for its enactment should be kept in mind and the statute should be construed with
reference to the intended scope and purpose. The court may consider the spirit and reason of the statute, where a
literal meaning would lead to absurdity, contradiction, injustice, or would defeat the clear purpose of the lawmakers.59
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals is partly REVERSED. The Decision of the
Regional Trial Court in Ilocos Norte is Reinstated.
SO ORDERED.
EN BANC
[G.R. No. 93054 : December 4, 1990.]
192 SCRA 100
Cordillera Regional Assembly Member ALEXANDER P. ORDILLO, (Banaue), Ifugao Provincial Board Member CORAZON
MONTINIG, (Mayoyao), Former Vice-Mayor MARTIN UDAN (Banaue), Municipal Councilors MARTIN GANO, (Lagawe),
and TEODORO HEWE, (Hingyon), Barangay Councilman PEDRO W. DULAG (Lamut); Aguinaldo residents SANDY B.
CHANGIWAN, and DONATO TIMAGO; Lamut resident REY ANTONIO; Kiangan residents ORLANDO PUGUON, and
REYNAND DULDULAO; Lagawe residents TOMAS KIMAYONG, GREGORIO DANGO, GEORGE B. BAYWONG, and
VICENTE LUNAG; Hingyon residents PABLO M. DULNUAN and CONSTANCIO GANO; Mayoyao residents PEDRO M.
BAOANG, LEONARDO IGADNA, and MAXIMO IGADNA; and Banaue residents PUMA-A CULHI, LATAYON BUTTIG,
MIGUEL PUMELBAN, ANDRES ORDILLO, FEDERICO MARIANO, SANDY BINOMNGA, GABRIEL LIMMANG, ROMEO
TONGALI, RUBEN BAHATAN, MHOMDY GABRIEL, and NADRES GHAMANG, Petitioners, vs.
THE COMMISSION ON ELECTIONS; The Honorable FRANKLIN M. DRILON, Secretary of Justice; Hon. CATALINO
MACARAIG, Executive Secretary; The Cabinet Officer for Regional Development; Hon. GUILLERMO CARAGUE,
Secretary of Budget and Management; and Hon. ROSALINA S. CAJUCOM, OIC, National Treasurer, Respondents.

DECISION

GUTIERREZ, JR., J.:

The question raised in this petition is whether or not the province of Ifugao, being the only province which voted
favorably for the creation of the Cordillera Autonomous Region can, alone, legally and validly constitute such Region.
The antecedent facts that gave rise to this petition are as follows:
On January 30, 1990, the people of the provinces of Benguet, Mountain Province, Ifugao, Abra and Kalinga-Apayao and
the city of Baguio cast their votes in a plebiscite held pursuant to Republic Act No. 6766 entitled "An Act Providing for an
Organic Act for the Cordillera Autonomous Region."
The official Commission on Elections (COMELEC) results of the plebiscite showed that the creation of the Region was
approved by a majority of 5,889 votes in only the Ifugao Province and was overwhelmingly rejected by 148,676 votes in
the rest of the provinces and city above-mentioned.
Consequently, the COMELEC, on February 14, 1990, issued Resolution No. 2259 stating that the Organic Act for the
Region has been approved and/or ratified by majority of the votes cast only in the province of Ifugao. On the same date,
the Secretary of Justice issued a memorandum for the President reiterating the COMELEC resolution and provided:
". . . [A]nd considering the proviso in Sec. 13(A) that only the provinces and city voting favorably shall be included in the
CAR, the province of Ifugao being the only province which voted favorably — then, alone, legally and validly constitutes
the CAR." (Rollo, p. 7)
As a result of this, on March 8, 1990, Congress enacted Republic Act No. 6861 setting the elections in the Cordillera
Autonomous Region of Ifugao on the first Monday of March 1991.: nad
Even before the issuance of the COMELEC resolution, the Executive Secretary on February 5, 1990 issued a
Memorandum granting authority to wind up the affairs of the Cordillera Executive Board and the Cordillera Regional
Assembly created under Executive Order No. 220.
On March 9, 1990, the petitioner filed a petition with COMELEC to declare the non-ratification of the Organic Act for the
Region. The COMELEC merely noted said petition.
On March 30, 1990, the President issued Administrative Order No. 160 declaring among others that the Cordillera
Executive Board and Cordillera Regional Assembly and all the offices created under Executive Order No. 220 were
abolished in view of the ratification of the Organic Act.- nad
The petitioners maintain that there can be no valid Cordillera Autonomous Region in only one province as the
Constitution and Republic Act No. 6766 require that the said Region be composed of more than one constituent unit.
The petitioners, then, pray that the Court: (1) declare null and void COMELEC resolution No. 2259, the memorandum of
the Secretary of Justice, the memorandum of the Executive Secretary, Administrative Order No. 160, and Republic Act
No. 6861 and prohibit and restrain the respondents from implementing the same and spending public funds for the
purpose and (2) declare Executive Order No. 220 constituting the Cordillera Executive Board and the Cordillera Regional
Assembly and other offices to be still in force and effect until another organic law for the Autonomous Region shall have
been enacted by Congress and the same is duly ratified by the voters in the constituent units. We treat the Comments of
the respondents as an answer and decide the case.
This petition is meritorious.
The sole province of Ifugao cannot validly constitute the Cordillera Autonomous Region.
It is explicit in Article X, Section 15 of the 1987 Constitution that:
"Section 15. There shall be created autonomous regions in Muslim Mindanao and in the Cordillera consisting of
provinces, cities, municipalities and geographical areas sharing common and distinctive historical and cultural heritage,
economic and social structures, and other relevant characteristics within the framework of this Constitution and the
national sovereignty as well as territorial integrity of the Republic of the Philippines." (Emphasis Supplied)
The keywords — provinces, cities, municipalities and geographical areas connote that "region" is to be made up of more
than one constituent unit. The term "region" used in its ordinary sense means two or more provinces. This is supported
by the fact that the thirteen (13) regions into which the Philippines is divided for administrative purposes are groupings
of contiguous provinces. (Integrated Reorganization Plan (1972), which was made as part of the law of the land by P.D.
No. 1; P.D. No. 742) Ifugao is a province by itself. To become part of a region, it must join other provinces, cities,
municipalities, and geographical areas. It joins other units because of their common and distinctive historical and
cultural heritage, economic and social structures and other relevant characteristics. The Constitutional requirements are
not present in this case.- nad
The well-established rule in statutory construction that the language of the Constitution, as much as possible should be
understood in the sense it has in common use and that the words used in constitutional provisions are to be given their
ordinary meaning except where technical terms are employed, must then, be applied in this case. (See Baranda v.
Gustilo, 165 SCRA 757, 770, [1988]; J.M. Tuason & Co., Inc. v. Land Tenure Administration, 31 SCRA 413, 422-423
[1970]).
Aside from the 1987 Constitution, a reading of the provisions of Republic Act No. 6766 strengthens the petitioner's
position that the Region cannot be constituted from only one province.
Article III, Sections 1 and 2 of the Statute provide that the Cordillera Autonomous Region is to be administered by the
Cordillera government consisting of the Regional Government and local government units. It further provides that:
"SECTION 2. The Regional Government shall exercise powers and functions necessary for the proper governance and
development of all provinces, cities, municipalities, and barangay or ili within the Autonomous Region . . ."
From these sections, it can be gleaned that Congress never intended that a single province may constitute the
autonomous region. Otherwise, we would be faced with the absurd situation of having two sets of officials, a set of
provincial officials and another set of regional officials exercising their executive and legislative powers over exactly the
same small area.
Article V, Sections 1 and 4 of Republic Act 6766 vest the legislative power in the Cordillera Assembly whose members
shall be elected from regional assembly districts apportioned among provinces and the cities composing the
Autonomous Region. chanrobles virtual law library
If we follow the respondent's position, the members of such Cordillera Assembly shall then be elected only from the
province of Ifugao creating an awkward predicament of having two legislative bodies — the Cordillera Assembly and the
Sangguniang Panlalawigan — exercising their legislative powers over the province of Ifugao. And since Ifugao is one of
the smallest provinces in the Philippines, population-wise, it would have too many government officials for so few
people.:-cralaw
Article XII, Section 10 of the law creates a Regional Planning and Development Board composed of the Cordillera
Governor, all the provincial governors and city mayors or their representatives, two members of the Cordillera
Assembly, and members representing the private sector. The Board has a counterpart in the provincial level called the
Provincial Planning and Development Coordinator. The Board's functions (Article XII, Section 10, par. 2, Republic Act No.
6766) are almost similar to those of the Provincial Coordinator's (Title Four, Chapter 3, Article 10, Section 220 (4), Batas
Pambansa Blg. 337 — Local Government Code). If it takes only one person in the provincial level to perform such
functions while on the other hand it takes an entire Board to perform almost the same tasks in the regional level, it
could only mean that a larger area must be covered at the regional level. The respondent's theory of the Autonomous
Region being made up of a single province must, therefore, fail.
Article XXI, Section 13 (B) (c) alloting the huge amount of Ten Million Pesos (P10,000,000.00) to the Regional
Government for its initial organizational requirements cannot be construed as funding only a lone and small province.
These sections of Republic Act No. 6766 show that a one province Cordillera Autonomous Region was never
contemplated by the law creating it.
The province of Ifugao makes up only 11% of the total population of the areas enumerated in Article I, Section 2 (b) of
Republic Act No. 6766 which include Benguet, Mountain Province, Abra, Kalinga-Apayao and Baguio City. It has the
second smallest number of inhabitants from among the provinces and city above mentioned. The Cordillera population
is distributed in round figures as follows: Abra, 185,000; Benguet, 486,000; Ifugao, 149,000; Kalinga-Apayao, 214,000;
Mountain Province, 116,000; and Baguio City, 183,000; Total population of these five provinces and one city; 1,332,000
according to the 1990 Census (Manila Standard, September 30, 1990, p. 14).
There are other provisions of Republic Act No. 6766 which are either violated or which cannot be complied with. Section
16 of Article V calls for a Regional Commission on Appointments with the Speaker as Chairman and are (6) members
coming from different provinces and cities in the Region. Under the respondents' view, the Commission would have a
Chairman and only one member. It would never have a quorum. Section 3 of Article VI calls for cabinet members, as far
as practicable, to come from various provinces and cities of the Region. Section 1 of Article VII creates a system of tribal
courts for the various indigenous cultural communities of the Region. Section 9 of Article XV requires the development
of a common regional language based upon the various languages and dialects in the region which regional language in
turn is expected to enrich the national language.
The entirety of Republic Act No. 6766 creating the Cordillera Autonomous Region is infused with provisions which rule
against the sole province of Ifugao constituting the Region.:-cralaw
To contemplate the situation envisioned by the respondent would not only violate the letter and intent of the
Constitution and Republic Act No. 6766 but would also be impractical and illogical.
Our decision in Abbas, et al. v. COMELEC, (G.R. No. 89651, November 10, 1969), is not applicable in the case at bar
contrary to the view of the Secretary of Justice.
The Abbas case laid down the rate on the meaning of majority in the phrase "by majority of the votes cast by the
constituent units called for the purpose" found in the Constitution, Article X, Section 18. It stated:
x x x
". . . [I]t is thus clear that what is required by the Constitution is simple majority of votes approving the Organic Act in
individual constituent units and not a double majority of the votes in all constituent units put together, as well as in the
individual constituent units."
This was the pronouncement applied by the Secretary of Justice in arriving at his conclusion stated in his Memorandum
for the President that:
x x x
". . . [i]t is believed that the creation of the Cordillera Autonomous Region (CAR) as mandated by R.A. No. 6766 became
effective upon its approval by the majority of the votes cast in the province of Ifugao. And considering the proviso in
Section 13 (a) that only the provinces and city voting favorably shall be included in the CAR, the province of Ifugao being
the only province which voted favorably — can, alone, legally and validly constitute the CAR." (Rollo. p. 40).
The plebiscites mandated by the Constitution and Republic Act No. 6766 for the Cordillera and Republic Act No. 6734 for
the Autonomous Region in Muslim Mindanao determine — (1) whether there shall be an autonomous region in the
Cordillera and in Muslim Mindanao and (2) which provinces and cities, among those enumerated in the two Republic
Acts, shall comprise said Autonomous Regions. (See III, Record of the Constitutional Commission, 487-492 [1986]).
The Abbas case established the rule to follow on which provinces and cities shall comprise the autonomous region in
Muslim Mindanao which is, consequently, the same rule to follow with regard to the autonomous region in the
Cordillera. However, there is nothing in the Abbas decision which deals with the issue on whether an autonomous
region, in either Muslim Mindanao or Cordillera could exist despite the fact that only one province or one city is to
constitute it.chanrobles virtual law library
Stated in another way, the issue in this case is whether the sole province of Ifugao can validly and legally constitute the
Cordillera Autonomous Region. The issue is not whether the province of Ifugao is to be included in the Cordillera
Autonomous Region. It is the first issue which the Court answers in the instant case.
WHEREFORE, the petition is hereby GRANTED. Resolution No. 2259 of the Commission on Elections, insofar as it upholds
the creation of an autonomous region, the February 14, 1990 memorandum of the Secretary of Justice, the February 5,
1990 memorandum of the Executive Secretary, Administrative Order No. 160, and Republic Act No. 6861 are declared
null and void while Executive Order No. 220 is declared to be still in force and effect until properly repealed or amended.
SO ORDERED.
Fernan C.J., Narvasa, Melencio-Herrera, Cruz, Paras, Gancayco, Padilla, Bidin, Sarmiento, Griño-Aquino, Medialdea and
Regalado, JJ., concur.
Feliciano, J., is on leave.
G.R. No. 176951 November 18, 2008
LEAGUE OF CITIES OF THE PHILIPPINES (LCP) represented by LCP National President JERRY P. TREÑAS, CITY OF ILOILO
represented by MAYOR JERRY P. TREÑAS, CITY OF CALBAYOG represented by MAYOR MEL SENEN S. SARMIENTO, and
JERRY P. TREÑAS in his personal capacity as taxpayer, petitioners,
vs.
COMMISSION ON ELECTIONS; MUNICIPALITY OF BAYBAY, PROVINCE OF LEYTE; MUNICIPALITY OF BOGO, PROVINCE
OF CEBU; MUNICIPALITY OF CATBALOGAN, PROVINCE OF WESTERN SAMAR; MUNICIPALITY OF TANDAG, PROVINCE
OF SURIGAO DEL SUR; MUNICIPALITY OF BORONGAN, PROVINCE OF EASTERN SAMAR; and MUNICIPALITY OF
TAYABAS, PROVINCE OF QUEZON, respondents.
CITY OF TARLAC, CITY OF SANTIAGO, CITY OF IRIGA, CITY OF LIGAO, CITY OF LEGAZPI, CITY OF TAGAYTAY, CITY OF
SURIGAO, CITY OF BAYAWAN, CITY OF SILAY, CITY OF GENERAL SANTOS, CITY OF ZAMBOANGA, CITY OF GINGOOG,
CITY OF CAUAYAN, CITY OF PAGADIAN, CITY OF SAN CARLOS, CITY OF SAN FERNANDO, CITY OF TACURONG, CITY OF
TANGUB, CITY OF OROQUIETA, CITY OF URDANETA, CITY OF VICTORIAS, CITY OF CALAPAN, CITY OF HIMAMAYLAN,
CITY OF BATANGAS, CITY OF BAIS, CITY OF CADIZ, and CITY OF TAGUM, petitioners-in-intervention.
x-----------------------------x
G.R. No. 177499 November 18, 2008
LEAGUE OF CITIES OF THE PHILIPPINES (LCP) represented by LCP National President JERRY P. TREÑAS, CITY OF ILOILO
represented by MAYOR JERRY P. TREÑAS, CITY OF CALBAYOG represented by MAYOR MEL SENEN S. SARMIENTO, and
JERRY P. TREÑAS in his personal capacity as taxpayer, petitioners,
vs.
COMMISSION ON ELECTIONS; MUNICIPALITY OF LAMITAN, PROVINCE OF BASILAN; MUNICIPALITY OF TABUK,
PROVINCE OF KALINGA; MUNICIPALITY OF BAYUGAN, PROVINCE OF AGUSAN DEL SUR; MUNICIPALITY OF BATAC,
PROVINCE OF ILOCOS NORTE; MUNICIPALITY OF MATI, PROVINCE OF DAVAO ORIENTAL; and MUNICIPALITY OF
GUIHULNGAN, PROVINCE OF NEGROS ORIENTAL, respondents.
CITY OF TARLAC, CITY OF SANTIAGO, CITY OF IRIGA, CITY OF LIGAO, CITY OF LEGAZPI, CITY OF TAGAYTAY, CITY OF
SURIGAO, CITY OF BAYAWAN, CITY OF SILAY, CITY OF GENERAL SANTOS, CITY OF ZAMBOANGA, CITY OF GINGOOG,
CITY OF CAUAYAN, CITY OF PAGADIAN, CITY OF SAN CARLOS, CITY OF SAN FERNANDO, CITY OF TACURONG, CITY OF
TANGUB, CITY OF OROQUIETA, CITY OF URDANETA, CITY OF VICTORIAS, CITY OF CALAPAN, CITY OF HIMAMAYLAN,
CITY OF BATANGAS, CITY OF BAIS, CITY OF CADIZ, and CITY OF TAGUM, petitioners-in-intervention.
x - - - - - - - - - - - - - - - - - - - - - - - - - - --x
G.R. No. 178056 November 18, 2008
LEAGUE OF CITIES OF THE PHILIPPINES (LCP) represented by LCP National President JERRY P. TREÑAS, CITY OF ILOILO
represented by MAYOR JERRY P. TREÑAS, CITY OF CALBAYOG represented by MAYOR MEL SENEN S. SARMIENTO, and
JERRY P. TREÑAS in his personal capacity as taxpayer, petitioners
vs.
COMMISSION ON ELECTIONS; MUNICIPALITY OF CABADBARAN, PROVINCE OF AGUSAN DEL NORTE; MUNICIPALITY OF
CARCAR, PROVINCE OF CEBU; and MUNICIPALITY OF EL SALVADOR, MISAMIS ORIENTAL, respondents.
CITY OF TARLAC, CITY OF SANTIAGO, CITY OF IRIGA, CITY OF LIGAO, CITY OF LEGAZPI, CITY OF TAGAYTAY, CITY OF
SURIGAO, CITY OF BAYAWAN, CITY OF SILAY, CITY OF GENERAL SANTOS, CITY OF ZAMBOANGA, CITY OF GINGOOG,
CITY OF CAUAYAN, CITY OF PAGADIAN, CITY OF SAN CARLOS, CITY OF SAN FERNANDO, CITY OF TACURONG, CITY OF
TANGUB, CITY OF OROQUIETA, CITY OF URDANETA, CITY OF VICTORIAS, CITY OF CALAPAN, CITY OF HIMAMAYLAN,
CITY OF BATANGAS, CITY OF BAIS, CITY OF CADIZ, and CITY OF TAGUM, petitioners-in-intervention.
DECISION
CARPIO, J.:
The Case
These are consolidated petitions for prohibition1 with prayer for the issuance of a writ of preliminary injunction or
temporary restraining order filed by the League of Cities of the Philippines, City of Iloilo, City of Calbayog, and Jerry P.
Treñas2 assailing the constitutionality of the subject Cityhood Laws and enjoining the Commission on Elections
(COMELEC) and respondent municipalities from conducting plebiscites pursuant to the Cityhood Laws.
The Facts
During the 11th Congress,3 Congress enacted into law 33 bills converting 33 municipalities into cities. However,
Congress did not act on bills converting 24 other municipalities into cities.
During the 12th Congress,4 Congress enacted into law Republic Act No. 9009 (RA 9009),5 which took effect on 30 June
2001. RA 9009 amended Section 450 of the Local Government Code by increasing the annual income requirement for
conversion of a municipality into a city from P20 million to P100 million. The rationale for the amendment was to
restrain, in the words of Senator Aquilino Pimentel, "the mad rush" of municipalities to convert into cities solely to
secure a larger share in the Internal Revenue Allotment despite the fact that they are incapable of fiscal independence.6
After the effectivity of RA 9009, the House of Representatives of the 12th Congress7 adopted Joint Resolution No.
29,8 which sought to exempt from the P100 million income requirement in RA 9009 the 24 municipalities whose
cityhood bills were not approved in the 11th Congress. However, the 12thCongress ended without the Senate approving
Joint Resolution No. 29.
During the 13th Congress,9 the House of Representatives re-adopted Joint Resolution No. 29 as Joint Resolution No. 1
and forwarded it to the Senate for approval. However, the Senate again failed to approve the Joint Resolution. Following
the advice of Senator Aquilino Pimentel, 16 municipalities filed, through their respective sponsors, individual cityhood
bills. The 16 cityhood bills contained a common provision exempting all the 16 municipalities from the P100 million
income requirement in RA 9009.
On 22 December 2006, the House of Representatives approved the cityhood bills. The Senate also approved the
cityhood bills in February 2007, except that of Naga, Cebu which was passed on 7 June 2007. The cityhood bills lapsed
into law (Cityhood Laws10) on various dates from March to July 2007 without the President's signature.11
The Cityhood Laws direct the COMELEC to hold plebiscites to determine whether the voters in each respondent
municipality approve of the conversion of their municipality into a city.
Petitioners filed the present petitions to declare the Cityhood Laws unconstitutional for violation of Section 10, Article X
of the Constitution, as well as for violation of the equal protection clause.12Petitioners also lament that the wholesale
conversion of municipalities into cities will reduce the share of existing cities in the Internal Revenue Allotment because
more cities will share the same amount of internal revenue set aside for all cities under Section 285 of the Local
Government Code.13
The Issues
The petitions raise the following fundamental issues:
1. Whether the Cityhood Laws violate Section 10, Article X of the Constitution; and
2. Whether the Cityhood Laws violate the equal protection clause.

The Ruling of the Court


We grant the petitions.
The Cityhood Laws violate Sections 6 and 10, Article X of the Constitution, and are thus unconstitutional.
First, applying the P100 million income requirement in RA 9009 to the present case is a prospective, not a retroactive
application, because RA 9009 took effect in 2001 while the cityhood bills became law more than five years later.
Second, the Constitution requires that Congress shall prescribe all the criteria for the creation of a city in the Local
Government Code and not in any other law, including the Cityhood Laws.
Third, the Cityhood Laws violate Section 6, Article X of the Constitution because they prevent a fair and just distribution
of the national taxes to local government units.
Fourth, the criteria prescribed in Section 450 of the Local Government Code, as amended by RA 9009, for converting a
municipality into a city are clear, plain and unambiguous, needing no resort to any statutory construction.
Fifth, the intent of members of the 11th Congress to exempt certain municipalities from the coverage of RA 9009
remained an intent and was never written into Section 450 of the Local Government Code.
Sixth, the deliberations of the 11th or 12th Congress on unapproved bills or resolutions are not extrinsic aids in
interpreting a law passed in the 13th Congress.
Seventh, even if the exemption in the Cityhood Laws were written in Section 450 of the Local Government Code, the
exemption would still be unconstitutional for violation of the equal protection clause.
Preliminary Matters
Prohibition is the proper action for testing the constitutionality of laws administered by the COMELEC,14 like the
Cityhood Laws, which direct the COMELEC to hold plebiscites in implementation of the Cityhood Laws. Petitioner League
of Cities of the Philippines has legal standing because Section 499 of the Local Government Code tasks the League with
the "primary purpose of ventilating, articulating and crystallizing issues affecting city government administration and
securing, through proper and legal means, solutions thereto."15 Petitioners-in-intervention,16 which are existing cities,
have legal standing because their Internal Revenue Allotment will be reduced if the Cityhood Laws are declared
constitutional. Mayor Jerry P. Treñas has legal standing because as Mayor of Iloilo City and as a taxpayer he has
sufficient interest to prevent the unlawful expenditure of public funds, like the release of more Internal Revenue
Allotment to political units than what the law allows.
Applying RA 9009 is a Prospective Application of the Law
RA 9009 became effective on 30 June 2001 during the 11th Congress. This law specifically amended Section 450 of the
Local Government Code, which now provides:
Section 450. Requisites for Creation. – (a) A municipality or a cluster of barangays may be converted into a component
city if it has a locally generated average annual income, as certified by the Department of Finance, of at least One
hundred million pesos (P100,000,000.00) for the last two (2) consecutive years based on 2000 constant prices, and if it
has either of the following requisites:
(i) a contiguous territory of at least one hundred (100) square kilometers, as certified by the Land Management Bureau;
or
(ii) a population of not less than one hundred fifty thousand (150,000) inhabitants, as certified by the National Statistics
Office.
The creation thereof shall not reduce the land area, population and income of the original unit or units at the time of
said creation to less than the minimum requirements prescribed herein.
(b) The territorial jurisdiction of a newly-created city shall be properly identified by metes and bounds. The requirement
on land area shall not apply where the city proposed to be created is composed of one (1) or more islands. The territory
need not be contiguous if it comprises two (2) or more islands.
(c) The average annual income shall include the income accruing to the general fund, exclusive of special funds,
transfers, and non-recurring income. (Emphasis supplied)
Thus, RA 9009 increased the income requirement for conversion of a municipality into a city from P20 million to P100
million. Section 450 of the Local Government Code, as amended by RA 9009, does not provide any exemption from the
increased income requirement.
Prior to the enactment of RA 9009, a total of 57 municipalities had cityhood bills pending in Congress. Thirty-three
cityhood bills became law before the enactment of RA 9009. Congress did not act on 24 cityhood bills during the
11th Congress.
During the 12th Congress, the House of Representatives adopted Joint Resolution No. 29, exempting from the income
requirement of P100 million in RA 9009 the 24 municipalities whose cityhood bills were not acted upon during the
11th Congress. This Resolution reached the Senate. However, the 12th Congress adjourned without the Senate
approving Joint Resolution No. 29.
During the 13th Congress, 16 of the 24 municipalities mentioned in the unapproved Joint Resolution No. 29 filed
between November and December of 2006, through their respective sponsors in Congress, individual cityhood bills
containing a common provision, as follows:
Exemption from Republic Act No. 9009. - The City of x x x shall be exempted from the income requirement prescribed
under Republic Act No. 9009.
This common provision exempted each of the 16 municipalities from the income requirement of P100 million prescribed
in Section 450 of the Local Government Code, as amended by RA 9009. These cityhood bills lapsed into law on various
dates from March to July 2007 after President Gloria Macapagal-Arroyo failed to sign them.
Indisputably, Congress passed the Cityhood Laws long after the effectivity of RA 9009. RA 9009 became effective on 30
June 2001 or during the 11th Congress. The 13th Congress passed in December 2006 the cityhood bills which became
law only in 2007. Thus, respondent municipalities cannot invoke the principle of non-retroactivity of laws.17 This basic
rule has no application because RA 9009, an earlier law to the Cityhood Laws, is not being applied retroactively but
prospectively.
Congress Must Prescribe in the Local Government Code All Criteria
Section 10, Article X of the 1987 Constitution provides:
No province, city, municipality, or barangay shall be created, divided, merged, abolished or its boundary substantially
altered, except in accordance with the criteria established in the local government code and subject to approval by a
majority of the votes cast in a plebiscite in the political units directly affected. (Emphasis supplied)
The Constitution is clear. The creation of local government units must follow the criteria established in the Local
Government Code and not in any other law. There is only one Local Government Code.18 The Constitution requires
Congress to stipulate in the Local Government Code all the criteria necessary for the creation of a city, including the
conversion of a municipality into a city. Congress cannot write such criteria in any other law, like the Cityhood Laws.
The criteria prescribed in the Local Government Code govern exclusively the creation of a city. No other law, not even
the charter of the city, can govern such creation. The clear intent of the Constitution is to insure that the creation of
cities and other political units must follow the same uniform, non-discriminatory criteria found solely in the Local
Government Code. Any derogation or deviation from the criteria prescribed in the Local Government Code violates
Section 10, Article X of the Constitution.
RA 9009 amended Section 450 of the Local Government Code to increase the income requirement from P20 million
to P100 million for the creation of a city. This took effect on 30 June 2001. Hence, from that moment the Local
Government Code required that any municipality desiring to become a city must satisfy the P100 million income
requirement. Section 450 of the Local Government Code, as amended by RA 9009, does not contain any exemption from
this income requirement.
In enacting RA 9009, Congress did not grant any exemption to respondent municipalities, even though their cityhood
bills were pending in Congress when Congress passed RA 9009. The Cityhood Laws, all enacted after the effectivity of RA
9009, explicitly exempt respondent municipalities from the increased income requirement in Section 450 of the Local
Government Code, as amended by RA 9009. Such exemption clearly violates Section 10, Article X of the Constitution and
is thus patently unconstitutional. To be valid, such exemption must be written in the Local Government Code and not in
any other law, including the Cityhood Laws.
Cityhood Laws Violate Section 6, Article X of the Constitution
Uniform and non-discriminatory criteria as prescribed in the Local Government Code are essential to implement a fair
and equitable distribution of national taxes to all local government units. Section 6, Article X of the Constitution
provides:
Local government units shall have a just share, as determined by law, in the national taxes which shall be automatically
released to them. (Emphasis supplied)
If the criteria in creating local government units are not uniform and discriminatory, there can be no fair and just
distribution of the national taxes to local government units.
A city with an annual income of only P20 million, all other criteria being equal, should not receive the same share in
national taxes as a city with an annual income of P100 million or more. The criteria of land area, population and income,
as prescribed in Section 450 of the Local Government Code, must be strictly followed because such criteria, prescribed
by law, are material in determining the "just share" of local government units in national taxes. Since the Cityhood Laws
do not follow the income criterion in Section 450 of the Local Government Code, they prevent the fair and just
distribution of the Internal Revenue Allotment in violation of Section 6, Article X of the Constitution.
Section 450 of the Local Government Code is Clear,
Plain and Unambiguous
There can be no resort to extrinsic aids – like deliberations of Congress – if the language of the law is plain, clear and
unambiguous. Courts determine the intent of the law from the literal language of the law, within the law's four
corners.19 If the language of the law is plain, clear and unambiguous, courts simply apply the law according to its
express terms. If a literal application of the law results in absurdity, impossibility or injustice, then courts may resort to
extrinsic aids of statutory construction like the legislative history of the law.20
Congress, in enacting RA 9009 to amend Section 450 of the Local Government Code, did not provide any exemption
from the increased income requirement, not even to respondent municipalities whose cityhood bills were then pending
when Congress passed RA 9009. Section 450 of the Local Government Code, as amended by RA 9009, contains no
exemption whatsoever. Since the law is clear, plain and unambiguous that any municipality desiring to convert into a
city must meet the increased income requirement, there is no reason to go beyond the letter of the law in applying
Section 450 of the Local Government Code, as amended by RA 9009.
The 11th Congress' Intent was not Written into the Local Government Code
True, members of Congress discussed exempting respondent municipalities from RA 9009, as shown by the various
deliberations on the matter during the 11th Congress. However, Congress did not write this intended exemption into
law. Congress could have easily included such exemption in RA 9009 but Congress did not. This is fatal to the cause of
respondent municipalities because such exemption must appear in RA 9009 as an amendment to Section 450 of the
Local Government Code. The Constitution requires that the criteria for the conversion of a municipality into a city,
including any exemption from such criteria, must all be written in the Local Government Code. Congress cannot
prescribe such criteria or exemption from such criteria in any other law. In short, Congress cannot create a city through a
law that does not comply with the criteria or exemption found in the Local Government Code.
Section 10 of Article X is similar to Section 16, Article XII of the Constitution prohibiting Congress from creating private
corporations except by a general law. Section 16 of Article XII provides:
The Congress shall not, except by general law, provide for the formation, organization, or regulation of private
corporations. Government-owned or controlled corporations may be created or established by special charters in the
interest of the common good and subject to the test of economic viability. (Emphasis supplied)
Thus, Congress must prescribe all the criteria for the "formation, organization, or regulation" of private corporations in
a general law applicable to all without discrimination.21 Congress cannot create a private corporation through a special
law or charter.
Deliberations of the 11th Congress on Unapproved Bills Inapplicable
Congress is not a continuing body.22 The unapproved cityhood bills filed during the 11th Congress became mere scraps
of paper upon the adjournment of the 11th Congress. All the hearings and deliberations conducted during the
11th Congress on unapproved bills also became worthless upon the adjournment of the 11th Congress. These hearings
and deliberations cannot be used to interpret bills enacted into law in the 13th or subsequent Congresses.
The members and officers of each Congress are different. All unapproved bills filed in one Congress become functus
officio upon adjournment of that Congress and must be re-filed anew in order to be taken up in the next Congress.
When their respective authors re-filed the cityhood bills in 2006 during the 13th Congress, the bills had to start from
square one again, going through the legislative mill just like bills taken up for the first time, from the filing to the
approval. Section 123, Rule XLIV of the Rules of the Senate, on Unfinished Business, provides:
Sec. 123. x x x
All pending matters and proceedings shall terminate upon the expiration of one (1) Congress, but may be taken by the
succeeding Congress as if presented for the first time. (Emphasis supplied)
Similarly, Section 78 of the Rules of the House of Representatives, on Unfinished Business, states:
Section 78. Calendar of Business. The Calendar of Business shall consist of the following:
a. Unfinished Business. This is business being considered by the House at the time of its last adjournment. Its
consideration shall be resumed until it is disposed of. The Unfinished Business at the end of a session shall be resumed
at the commencement of the next session as if no adjournment has taken place. At the end of the term of a Congress, all
Unfinished Business are deemed terminated. (Emphasis supplied)
Thus, the deliberations during the 11th Congress on the unapproved cityhood bills, as well as the deliberations during
the 12th and 13th Congresses on the unapproved resolution exempting from RA 9009 certain municipalities, have no
legal significance. They do not qualify as extrinsic aids in construing laws passed by subsequent Congresses.
Applicability of Equal Protection Clause
If Section 450 of the Local Government Code, as amended by RA 9009, contained an exemption to the P100 million
annual income requirement, the criteria for such exemption could be scrutinized for possible violation of the equal
protection clause. Thus, the criteria for the exemption, if found in the Local Government Code, could be assailed on the
ground of absence of a valid classification. However, Section 450 of the Local Government Code, as amended by RA
9009, does not contain any exemption. The exemption is contained in the Cityhood Laws, which are unconstitutional
because such exemption must be prescribed in the Local Government Code as mandated in Section 10, Article X of the
Constitution.
Even if the exemption provision in the Cityhood Laws were written in Section 450 of the Local Government Code, as
amended by RA 9009, such exemption would still be unconstitutional for violation of the equal protection clause. The
exemption provision merely states, "Exemption from Republic Act No. 9009 ─ The City of x x x shall be exempted from
the income requirement prescribed under Republic Act No. 9009." This one sentence exemption provision contains no
classification standards or guidelines differentiating the exempted municipalities from those that are not exempted.
Even if we take into account the deliberations in the 11th Congress that municipalities with pending cityhood bills should
be exempt from the P100 million income requirement, there is still no valid classification to satisfy the equal protection
clause. The exemption will be based solely on the fact that the 16 municipalities had cityhood bills pending in the
11th Congress when RA 9009 was enacted. This is not a valid classification between those entitled and those not entitled
to exemption from the P100 million income requirement.
To be valid, the classification in the present case must be based on substantial distinctions, rationally related to a
legitimate government objective which is the purpose of the law,23 not limited to existing conditions only, and
applicable to all similarly situated. Thus, this Court has ruled:
The equal protection clause of the 1987 Constitution permits a valid classification under the following conditions:
1. The classification must rest on substantial distinctions;
2. The classification must be germane to the purpose of the law;
3. The classification must not be limited to existing conditions only; and
4. The classification must apply equally to all members of the same class.24

There is no substantial distinction between municipalities with pending cityhood bills in the 11thCongress and
municipalities that did not have pending bills. The mere pendency of a cityhood bill in the 11th Congress is not a
material difference to distinguish one municipality from another for the purpose of the income requirement. The
pendency of a cityhood bill in the 11th Congress does not affect or determine the level of income of a municipality.
Municipalities with pending cityhood bills in the 11th Congress might even have lower annual income than
municipalities that did not have pending cityhood bills. In short, the classification criterion − mere pendency of a
cityhood bill in the 11th Congress − is not rationally related to the purpose of the law which is to prevent fiscally non-
viable municipalities from converting into cities.
Municipalities that did not have pending cityhood bills were not informed that a pending cityhood bill in the
11th Congress would be a condition for exemption from the increased P100 million income requirement. Had they been
informed, many municipalities would have caused the filing of their own cityhood bills. These municipalities, even if they
have bigger annual income than the 16 respondent municipalities, cannot now convert into cities if their income is less
than P100 million.
The fact of pendency of a cityhood bill in the 11th Congress limits the exemption to a specific condition existing at the
time of passage of RA 9009. That specific condition will never happen again. This violates the requirement that a valid
classification must not be limited to existing conditions only. This requirement is illustrated in Mayflower Farms, Inc. v.
Ten Eyck,25 where the challenged law allowed milk dealers engaged in business prior to a fixed date to sell at a price
lower than that allowed to newcomers in the same business. In Mayflower, the U.S. Supreme Court held:
We are referred to a host of decisions to the effect that a regulatory law may be prospective in operation and may
except from its sweep those presently engaged in the calling or activity to which it is directed. Examples are statutes
licensing physicians and dentists, which apply only to those entering the profession subsequent to the passage of the act
and exempt those then in practice, or zoning laws which exempt existing buildings, or laws forbidding slaughterhouses
within certain areas, but excepting existing establishments. The challenged provision is unlike such laws, since, on its
face, it is not a regulation of a business or an activity in the interest of, or for the protection of, the public, but an
attempt to give an economic advantage to those engaged in a given business at an arbitrary date as against all those
who enter the industry after that date. The appellees do not intimate that the classification bears any relation to the
public health or welfare generally; that the provision will discourage monopoly; or that it was aimed at any abuse,
cognizable by law, in the milk business. In the absence of any such showing, we have no right to conjure up possible
situations which might justify the discrimination. The classification is arbitrary and unreasonable and denies the
appellant the equal protection of the law. (Emphasis supplied)
In the same vein, the exemption provision in the Cityhood Laws gives the 16 municipalities a unique advantage based on
an arbitrary date − the filing of their cityhood bills before the end of the 11thCongress - as against all other
municipalities that want to convert into cities after the effectivity of RA 9009.
Furthermore, limiting the exemption only to the 16 municipalities violates the requirement that the classification must
apply to all similarly situated. Municipalities with the same income as the 16 respondent municipalities cannot convert
into cities, while the 16 respondent municipalities can. Clearly, as worded the exemption provision found in the
Cityhood Laws, even if it were written in Section 450 of the Local Government Code, would still be unconstitutional for
violation of the equal protection clause.
WHEREFORE, we GRANT the petitions and declare UNCONSTITUTIONAL the Cityhood Laws, namely: Republic Act Nos.
9389, 9390, 9391, 9392, 9393, 9394, 9398, 9404, 9405, 9407, 9408, 9409, 9434, 9435, 9436, and 9491.
SO ORDERED.
G.R. No. 103702 December 6, 1994
MUNICIPALITY OF SAN NARCISO, QUEZON; MAYOR JUAN K. UY; COUNCILORS: DEOGRACIAS R. ARGOSINO III, BENITO
T. CAPIO, EMMANUEL R. CORTEZ, NORMANDO MONTILLA, LEONARDO C. UY, FIDEL C. AURELLANA, PEDRO C.
CARABIT, LEONARDO D. AURELLANA, FABIAN M. MEDENILLA, TRINIDAD F. CORTEZ, SALVADOR M. MEDENILLA,
CERELITO B. AUREADA and FRANCISCA A. BAMBA, petitioners,
vs.
HON. ANTONIO V. MENDEZ, SR., Presiding Judge, Regional Trial Court, Branch 62, 4th Judicial Region, Gumaca,
Quezon; MUNICIPALITY OF SAN ANDRES, QUEZON; MAYOR FRANCISCO DE LEON; COUNCILORS: FE LUPINAC, TOMAS
AVERIA, MANUEL O. OSAS, WILFREDO O. FONTANIL, ENRICO U. NADRES, RODELITO LUZOIR, LENAC, JOSE L. CARABOT,
DOMING AUSA, VIDAL BANQUELES and CORAZON M. MAXIMO, respondents.
Manuel Laserna, Jr. for petitioners.
Florante Pamfilo for private respondents.
VITUG, J.:
On 20 August 1959, President Carlos P. Garcia, issued, pursuant to the then Sections 68 and 2630 of the Revised
Administrative Code, as amended, Executive Order No. 353 creating the municipal district of San Andres, Quezon, by
segregating from the municipality of San Narciso of the same province, the barrios of San Andres, Mangero, Alibijaban,
Pansoy, Camflora and Tala along with their respective sitios.
Executive Order No. 353 was issued upon the request, addressed to the President and coursed through the Provincial
Board of Quezon, of the municipal council of San Narciso, Quezon, in its Resolution No. 8 of 24 May 1959.1
By virtue of Executive Order No. 174, dated 05 October 1965, issued by President Diosdado Macapagal, the municipal
district of San Andres was later officially recognized to have gained the status of a fifth class municipality beginning 01
July 1963 by operation of Section 2 of Republic Act No. 1515.2 The executive order added that "(t)he conversion of this
municipal district into (a) municipality as proposed in House Bill No. 4864 was approved by the House of
Representatives."
On 05 June 1989, the Municipality of San Narciso filed a petition for quo warranto with the Regional Trial Court, Branch
62, in Gumaca, Quezon, against the officials of the Municipality of San Andres. Docketed Special Civil Action No. 2014-G,
the petition sought the declaration of nullity of Executive Order No. 353 and prayed that the respondent local officials of
the Municipality of San Andres be permanently ordered to refrain from performing the duties and functions of their
respective offices.3 Invoking the ruling of this Court in Pelaez v. Auditor General,4 the petitioning municipality
contended that Executive Order No. 353, a presidential act, was a clear usurpation of the inherent powers of the
legislature and in violation of the constitutional principle of separation of powers. Hence, petitioner municipality argued,
the officials of the Municipality or Municipal District of San Andres had no right to exercise the duties and functions of
their respective offices that righfully belonged to the corresponding officials of the Municipality of San Narciso.
In their answer, respondents asked for the dismissal of the petition, averring, by way of affirmative and special defenses,
that since it was at the instance of petitioner municipality that the Municipality of San Andres was given life with the
issuance of Executive Order No. 353, it (petitioner municipality) should be deemed estopped from questioning the
creation of the new municipality;5 that because the Municipality of San Andred had been in existence since 1959, its
corporate personality could no longer be assailed; and that, considering the petition to be one for quo warranto,
petitioner municipality was not the proper party to bring the action, that prerogative being reserved to the State acting
through the Solicitor General.6
On 18 July 1991, after the parties had submitted their respective pre-trial briefs, the trial court resolved to defer action
on the motion to dismiss and to deny a judgment on the pleadings.
On 27 November 1991, the Municipality of San Andres filed anew a motion to dismiss alleging that the case had become
moot and academic with the enactment of Republic Act No. 7160, otherwise known as the Local Government Code of
1991, which took effect on 01 January 1991. The movant municipality cited Section 442(d) of the law, reading thusly:
Sec. 442. Requisites for Creation. — . . .
(d) Municipalities existing as of the date of the effectivity of this Code shall continue to exist and operate as such.
Existing municipal districts organized pursuant to presidential issuances or executive orders and which have their
respective set of elective municipal officials holding office at the time of the effectivity of this Code shall henceforth be
considered as regular municipalities.
The motion was opposed by petitioner municipality, contending that the above provision of law was inapplicable to the
Municipality of San Andres since the enactment referred to legally existing municipalities and not to those whose mode
of creation had been void ab initio.7
In its Order of 02 December 1991, the lower court8 finally dismissed the petition9 for lack of cause of action on what it
felt was a matter that belonged to the State, adding that "whatever defects (were) present in the creation of municipal
districts by the President pursuant to presidential issuances and executive orders, (were) cured by the enactment of R.A.
7160, otherwise known as Local Government Code of 1991." In an order, dated 17 January 1992, the same court denied
petitioner municipality's motion for reconsideration.
Hence, this petition "for review on certiorari." Petitioners 10 argue that in issuing the orders of 02 December 1991 and
17 January 1992, the lower court has "acted with grave abuse of discretion amounting to lack of or in excess of
jurisdiction." Petitioners assert that the existence of a municipality created by a null and void presidential order may be
attacked either directly or even collaterally by anyone whose interests or rights are affected, and that an
unconstitutional act is not a law, creates no office and is inoperative such as though its has never been passed. 11
Petitioners consider the instant petition to be one for "review on certiorari" under Rules 42 and 45 of the Rules of Court;
at the same time, however, they question the orders of the lower court for having been issued with "grave abuse of
discretion amounting to lack of or in excess of jurisdiction, and that there is no other plain, speedy and adequate remedy
in the ordinary course of law available to petitioners to correct said Orders, to protect their rights and to secure a final
and definitive interpretation of the legal issues involved." 12 Evidently, then, the petitioners intend to submit their case
in this instance under Rule 65. We shall disregard the procedural incongruence.
The special civil action of quo warranto is a "prerogative writ by which the Government can call upon any person to
show by what warrant he holds a public office or exercises a public franchise." 13 When the inquiry is focused on the
legal existence of a body politic, the action is reserved to the State in a proceeding for quo warranto or any other credit
proceeding. 14 It must be brought "in the name of the Republic of the Philippines" 15 and commenced by the Solicitor
General or the fiscal "when directed by the President of the Philippines . . . ." 16 Such officers may, under certain
circumstances, bring such an action "at the request and upon the relation of another person" with the permission of the
court. 17 The Rules of Court also allows an individual to commence an action for quo warranto in his own name but this
initiative can be done when he claims to be "entitled to a public office or position usurped or unlawfully held or
exercised by another." 18 While the quo warranto proceedings filed below by petitioner municipality has so named only
the officials of the Municipality of San Andres as respondents, it is virtually, however, a denunciation of the authority of
the Municipality or Municipal District of San Andres to exist and to act in that capacity.
At any rate, in the interest of resolving any further doubt on the legal status of the Municipality of San Andres, the Court
shall delve into the merits of the petition.
While petitioners would grant that the enactment of Republic Act
No. 7160 may have converted the Municipality of San Andres into a de facto municipality, they, however, contend that
since the petition for quo warranto had been filed prior to the passage of said law, petitioner municipality had acquired
a vested right to seek the nullification of Executive Order No. 353, and any attempt to apply Section 442 of Republic Act
7160 to the petition would perforce be violative of due process and the equal protection clause of the Constitution.
Petitioners' theory might perhaps be a point to consider had the case been seasonably brought. Executive Order No. 353
creating the municipal district of San Andres was issued on 20 August 1959 but it was only after almost thirty (30) years,
or on 05 June 1989, that the municipality of San Narciso finally decided to challenge the legality of the executive order.
In the meantime, the Municipal District, and later the Municipality, of San Andres, began and continued to exercise the
powers and authority of a duly created local government unit. In the same manner that the failure of a public officer to
question his ouster or the right of another to hold a position within a one-year period can abrogate an action belatedly
filed, 19 so also, if not indeed with greatest imperativeness, must a quo warranto proceeding assailing the lawful
authority of a political subdivision be timely raised. 20 Public interest
demands it.
Granting the Executive Order No. 353 was a complete nullity for being the result of an unconstitutional delegation of
legislative power, the peculiar circumstances obtaining in this case hardly could offer a choice other than to consider the
Municipality of San Andres to have at least attained a status uniquely of its own closely approximating, if not in fact
attaining, that of a de facto municipal corporation. Conventional wisdom cannot allow it to be otherwise. Created in
1959 by virtue of Executive Order No. 353, the Municipality of San Andres had been in existence for more than six years
when, on 24 December 1965, Pelaez v. Auditor General was promulgated. The ruling could have sounded the call for a
similar declaration of the unconstitutionality of Executive Order No. 353 but it was not to be the case. On the contrary,
certain governmental acts all pointed to the State's recognition of the continued existence of the Municipality of San
Andres. Thus, after more than five years as a municipal district, Executive Order No. 174 classified the Municipality of
San Andres as a fifth class municipality after having surpassed the income requirement laid out in Republic Act No. 1515.
Section 31 of Batas Pambansa Blg. 129, otherwise known as the Judiciary Reorganization Act of 1980, constituted as
municipal circuits, in the establishment of Municipal Circuit Trial Courts in the country, certain municipalities that
comprised the municipal circuits organized under Administrative Order No. 33, dated 13 June 1978, issued by this Court
pursuant to Presidential Decree No. 537. Under this administrative order, the Municipality of San Andres had been
covered by the 10th Municipal Circuit Court of San Francisco-San Andres for the province of Quezon.
At the present time, all doubts on the de jure standing of the municipality must be dispelled. Under the Ordinance
(adopted on 15 October 1986) apportioning the seats of the House of Representatives, appended to the 1987
Constitution, the Municipality of San Andres has been considered to be one of the twelve (12) municipalities composing
the Third District of the province of Quezon. Equally significant is Section 442(d) of the Local Government Code to the
effect that municipal districts "organized pursuant to presidential issuances or executive orders and which have their
respective sets of elective municipal officials holding office at the time of the effectivity of (the) Code shall henceforth be
considered as regular municipalities." No pretension of unconstitutionality per se of Section 442(d) of the Local
Government Code is proferred. It is doubtful whether such a pretext, even if made, would succeed. The power to create
political subdivisions is a function of the legislature. Congress did just that when it has incorporated Section 442(d) in the
Code. Curative laws, which in essence are retrospective, 21 and aimed at giving "validity to acts done that would have
been invalid under existing laws, as if existing laws have been complied with," are validly accepted in this jurisdiction,
subject to the usual qualification against impairment of vested rights. 22
All considered, the de jure status of the Municipality of San Andres in the province of Quezon must now be conceded.
WHEREFORE, the instant petition for certiorari is hereby DISMISSED. Costs against petitioners.
SO ORDERED.
Narvasa, C.J., Padilla, Bidin, Regalado, Davide, Jr., Romero, Bellosillo, Melo, Quiason, Puno, Kapunan and Mendoza, JJ.
concur.
Feliciano, J., is on leave.
EN BANC
BAI SANDRA S. A. SEMA, G.R. No. 177597 Petitioner,
- versus -
COMMISSION ON ELECTIONS and DIDAGEN P. DILANGALEN, Respondents.
x------------------------x
PERFECTO F. MARQUEZ, G.R. No. 178628 Petitioner,
Present:
PUNO, C.J., QUISUMBING, YNARES-SANTIAGO, CARPIO, AUSTRIA-MARTINEZ, CORONA, CARPIO MORALES,
- versus - AZCUNA, TINGA, CHICO-NAZARIO, VELASCO, JR., NACHURA, REYES, LEONARDO-DE CASTRO, and
BRION, JJ.
COMMISSION ON ELECTIONS, Promulgated:
Respondent. July 16, 2008
x--------------------------------------------------x
DECISION
CARPIO, J.:
The Case
These consolidated petitions[1] seek to annul Resolution No. 7902, dated 10 May 2007, of the Commission on Elections
(COMELEC) treating Cotabato City as part of the legislative district of the Province of Shariff Kabunsuan.[2]

The Facts
The Ordinance appended to the 1987 Constitution apportioned two legislative districts for
the Province of Maguindanao. The first legislative district consists of Cotabato City and eight
municipalities.[3] Maguindanao forms part of the Autonomous Region in Muslim Mindanao (ARMM), created under its
Organic Act, Republic Act No. 6734 (RA 6734), as amended by Republic Act No. 9054 (RA 9054).[4] Although under the
Ordinance, Cotabato City forms part of Maguindanaos first legislative district, it is not part of the ARMM but of Region
XII, having voted against its inclusion in the ARMM in the plebiscite held in November 1989.

On 28 August 2006, the ARMMs legislature, the ARMM Regional Assembly, exercising its power to create provinces
under Section 19, Article VI of RA 9054,[5]enacted Muslim Mindanao Autonomy Act No. 201 (MMA Act 201) creating
the Province of Shariff Kabunsuan composed of the eight municipalities in the first district of Maguindanao. MMA Act
201 provides:
Section 1. The Municipalities of Barira, Buldon, Datu Odin Sinsuat, Kabuntalan, Matanog, Parang, Sultan Kudarat, Sultan
Mastura, and Upi are hereby separated from the Province of Maguindanao and constituted into a distinct and
independent province, which is hereby created, to be known as the Province of Shariff Kabunsuan.

xxxx

Sec. 5. The corporate existence of this province shall commence upon the appointment by the Regional Governor or
election of the governor and majority of the regular members of the Sangguniang Panlalawigan.

The incumbent elective provincial officials of the Province of Maguindanao shall continue to serve their unexpired terms
in the province that they will choose or where they are residents: Provided, that where an elective position in both
provinces becomes vacant as a consequence of the creation of the Province of Shariff Kabunsuan, all incumbent elective
provincial officials shall have preference for appointment to a higher elective vacant position and for the time being be
appointed by the Regional Governor, and shall hold office until their successors shall have been elected and qualified in
the next local elections; Provided, further, that they shall continue to receive the salaries they are receiving at the time
of the approval of this Act until the new readjustment of salaries in accordance with law. Provided, furthermore, that
there shall be no diminution in the number of the members of the Sangguniang Panlalawigan of the mother province.

Except as may be provided by national law, the existing legislative district, which includes Cotabato as a part thereof,
shall remain.

Later, three new municipalities[6] were carved out of the original nine municipalities constituting Shariff Kabunsuan,
bringing its total number of municipalities to 11. Thus, what was left of Maguindanao were the municipalities
constituting its second legislative district. Cotabato City, although part of Maguindanaos first legislative district, is not
part of the Province of Maguindanao.

The voters of Maguindanao ratified Shariff Kabunsuans creation in a plebiscite held on 29 October 2006.
On 6 February 2007, the Sangguniang Panlungsod of Cotabato City passed Resolution No. 3999 requesting the COMELEC
to clarify the status of Cotabato City in view of the conversion of the First District of Maguindanao into a regular
province under MMA Act 201.
In answer to Cotabato Citys query, the COMELEC issued Resolution No. 07-0407 on 6 March 2007 "maintaining the
status quo with Cotabato City as part of Shariff Kabunsuan in the First Legislative District of Maguindanao. Resolution
No. 07-0407, which adopted the recommendation of the COMELECs Law Department under a Memorandum dated 27
February 2007,[7] provides in pertinent parts:

Considering the foregoing, the Commission RESOLVED, as it hereby resolves, to adopt the recommendation of the Law
Department that pending the enactment of the appropriate law by Congress, to maintain the status quo
with Cotabato City as part of Shariff Kabunsuan in the First Legislative District of Maguindanao. (Emphasis supplied)

However, in preparation for the 14 May 2007 elections, the COMELEC promulgated on 29 March 2007 Resolution No.
7845 stating that Maguindanaos first legislative district is composed only of Cotabato City because of the enactment of
MMA Act 201.[8]

On 10 May 2007, the COMELEC issued Resolution No. 7902, subject of these petitions, amending Resolution No. 07-0407
by renaming the legislative district in question as Shariff Kabunsuan Province with Cotabato City (formerly First District
of Maguindanao with Cotabato City).[9]

In G.R. No. 177597, Sema, who was a candidate in the 14 May 2007 elections for Representative of Shariff Kabunsuan
with Cotabato City, prayed for the nullification of COMELEC Resolution No. 7902 and the exclusion from canvassing of
the votes cast in Cotabato City for that office. Sema contended that Shariff Kabunsuan is entitled to one representative
in Congress under Section 5 (3), Article VI of the Constitution[10] and Section 3 of the Ordinance appended to the
Constitution.[11] Thus, Sema asserted that the COMELEC acted without or in excess of its jurisdiction in issuing
Resolution No. 7902 which maintained the status quo in Maguindanaos first legislative district despite the COMELECs
earlier directive in Resolution No. 7845 designating Cotabato City as the lone component of Maguindanaos
reapportioned first legislative district.[12] Sema further claimed that in issuing Resolution No. 7902, the COMELEC
usurped Congress power to create or reapportion legislative districts.

In its Comment, the COMELEC, through the Office of the Solicitor General (OSG), chose not to reach the merits of the
case and merely contended that (1) Sema wrongly availed of the writ of certiorari to nullify COMELEC Resolution No.
7902 because the COMELEC issued the same in the exercise of its administrative, not quasi-judicial, power and (2) Semas
prayer for the writ of prohibition in G.R. No. 177597 became moot with the proclamation of respondent Didagen P.
Dilangalen (respondent Dilangalen) on 1 June 2007 as representative of the legislative district of Shariff Kabunsuan
Province with Cotabato City.

In his Comment, respondent Dilangalen countered that Sema is estopped from questioning COMELEC Resolution No.
7902 because in her certificate of candidacy filed on 29 March 2007, Sema indicated that she was seeking election as
representative of Shariff Kabunsuan including Cotabato City. Respondent Dilangalen added that COMELEC Resolution
No. 7902 is constitutional because it did not apportion a legislative district for Shariff Kabunsuan or reapportion the
legislative districts in Maguindanao but merely renamed Maguindanaos first legislative district. Respondent Dilangalen
further claimed that the COMELEC could not reapportion Maguindanaos first legislative district to make Cotabato City its
sole component unit as the power to reapportion legislative districts lies exclusively with Congress, not to mention that
Cotabato City does not meet the minimum population requirement under Section 5 (3), Article VI of the Constitution for
the creation of a legislative district within a city.[13]

Sema filed a Consolidated Reply controverting the matters raised in respondents Comments and reiterating her claim
that the COMELEC acted ultra vires in issuing Resolution No. 7902.

In the Resolution of 4 September 2007, the Court required the parties in G.R. No. 177597 to comment on the issue of
whether a province created by the ARMM Regional Assembly under Section 19, Article VI of RA 9054 is entitled to one
representative in the House of Representatives without need of a national law creating a legislative district for such new
province. The parties submitted their compliance as follows:

(1) Sema answered the issue in the affirmative on the following grounds: (a) the Court in Felwa v. Salas[14] stated that
when a province is created by statute, the corresponding representative district comes into existence neither by
authority of that statute which cannot provide otherwise nor by apportionment, but by operation of the Constitution,
without a reapportionment; (b) Section 462 of Republic Act No. 7160 (RA 7160) affirms the apportionment of a
legislative district incident to the creation of a province; and (c) Section 5 (3), Article VI of the Constitution and Section 3
of the Ordinance appended to the Constitution mandate theapportionment of a legislative district in newly created
provinces.

(2) The COMELEC, again represented by the OSG, apparently abandoned its earlier stance on the propriety of issuing
Resolution Nos. 07-0407 and 7902 and joined causes with Sema, contending that Section 5 (3), Article VI of the
Constitution is self-executing. Thus, every new province created by the ARMM Regional Assembly is ipso facto entitled
to one representative in the House of Representatives even in the absence of a national law; and

(3) Respondent Dilangalen answered the issue in the negative on the following grounds: (a) the province contemplated
in Section 5 (3), Article VI of the Constitution is one that is created by an act of Congress taking into account the
provisions in RA 7160 on the creation of provinces; (b) Section 3, Article IV of RA 9054 withheld from the ARMM
Regional Assembly the power to enact measures relating to national elections, which encompasses the apportionment
of legislative districts for members of the House of Representatives; (c) recognizing a legislative district in every province
the ARMM Regional Assembly creates will lead to the disproportionate representation of the ARMM in the House of
Representatives as the Regional Assembly can create provinces without regard to the requirements in Section 461 of RA
7160; and (d) Cotabato City, which has a population of less than 250,000, is not entitled to a representative in the House
of Representatives.

On 27 November 2007, the Court heard the parties in G.R. No. 177597 in oral arguments on the following issues: (1)
whether Section 19, Article VI of RA 9054, delegating to the ARMM Regional Assembly the power to create provinces, is
constitutional; and (2) if in the affirmative, whether a province created under Section 19, Article VI of RA 9054 is entitled
to one representative in the House of Representatives without need of a national law creating a legislative district for
such new province.[15]

In compliance with the Resolution dated 27 November 2007, the parties in G.R. No. 177597 filed their respective
Memoranda on the issues raised in the oral arguments.[16] On the question of the constitutionality of Section 19, Article
VI of RA 9054, the parties in G.R. No. 177597 adopted the following positions:

(1) Sema contended that Section 19, Article VI of RA 9054 is constitutional (a) as a valid delegation by Congress to the
ARMM of the power to create provinces under Section 20 (9), Article X of the Constitution granting to the autonomous
regions, through their organic acts, legislative powers over other matters as may be authorized by law for the promotion
of the general welfare of the people of the region and (b) as an amendment to Section 6 of RA 7160.[17] However, Sema
concedes that, if taken literally, the grant in Section 19, Article VI of RA 9054 to the ARMM Regional Assembly of the
power to prescribe standards lower than those mandated in RA 7160 in the creation of provinces contravenes Section
10, Article X of the Constitution.[18] Thus, Sema proposed that Section 19 should be construed as prohibiting the
Regional Assembly from prescribing standards x x x that do not comply with the minimum criteria under RA 7160.[19]

(2) Respondent Dilangalen contended that Section 19, Article VI of RA 9054 is unconstitutional on the following grounds:
(a) the power to create provinces was not among those granted to the autonomous regions under Section 20, Article X
of the Constitution and (b) the grant under Section 19, Article VI of RA 9054 to the ARMM Regional Assembly of the
power to prescribe standards lower than those mandated in Section 461 of RA 7160 on the creation of provinces
contravenes Section 10, Article X of the Constitution and the Equal Protection Clause; and

(3) The COMELEC, through the OSG, joined causes with respondent Dilangalen (thus effectively abandoning the position
the COMELEC adopted in its Compliance with the Resolution of 4 September 2007) and contended that Section 19,
Article VI of RA 9054 is unconstitutional because (a) it contravenes Section 10 and Section 6,[20] Article X of the
Constitution and (b) the power to create provinces was withheld from the autonomous regions under Section 20, Article
X of the Constitution.

On the question of whether a province created under Section 19, Article VI of RA 9054 is entitled to one representative
in the House of Representatives without need of a national law creating a legislative district for such new province,
Sema and respondent Dilangalen reiterated in their Memoranda the positions they adopted in their Compliance with the
Resolution of 4 September 2007. The COMELEC deemed it unnecessary to submit its position on this issue considering its
stance that Section 19, Article VI of RA 9054 is unconstitutional.

The pendency of the petition in G.R. No. 178628 was disclosed during the oral arguments on 27 November 2007. Thus,
in the Resolution of 19 February 2008, the Court ordered G.R. No. 178628 consolidated with G.R. No. 177597. The
petition in G.R. No. 178628 echoed Sema's contention that the COMELEC acted ultra vires in issuing Resolution No. 7902
depriving the voters of Cotabato City of a representative in the House of Representatives. In its Comment to the petition
in G.R.No. 178628, the COMELEC, through the OSG, maintained the validity of COMELEC Resolution No. 7902 as a
temporary measure pending the enactment by Congress of the appropriate law.

The Issues

The petitions raise the following issues:

I. In G.R. No. 177597:


(A) Preliminarily
(1) whether the writs of Certiorari, Prohibition, and Mandamus are proper to test the constitutionality of COMELEC
Resolution No. 7902; and
(2) whether the proclamation of respondent Dilangalen as representative
of Shariff Kabunsuan Province with Cotabato City mooted the petition in G.R. No. 177597.

(B) On the merits


(1) whether Section 19, Article VI of RA 9054, delegating to the ARMM Regional Assembly the power to create provinces,
cities, municipalities and barangays, is constitutional; and
(2) if in the affirmative, whether a province created by the ARMM Regional Assembly under MMA Act 201 pursuant to
Section 19, Article VI of RA 9054 is entitled to one representative in the House of Representatives without need of a
national law creating a legislative district for such province.

II. In G.R No. 177597 and G.R No. 178628, whether COMELEC Resolution No. 7902 is valid for maintaining the status quo
in the first legislative district of Maguindanao (as Shariff Kabunsuan Province with Cotabato City [formerly First District
of Maguindanao with Cotabato City]), despite the creation of the Province of Shariff Kabunsuan out of such district
(excluding Cotabato City).

The Ruling of the Court


The petitions have no merit. We rule that (1) Section 19, Article VI of RA 9054 is unconstitutional insofar as it grants to
the ARMM Regional Assembly the power to create provinces and cities; (2) MMA Act 201 creating the Province of Shariff
Kabunsuan is void; and (3) COMELEC Resolution No. 7902 is valid.

On the Preliminary Matters

The Writ of Prohibition is Appropriate


to Test the Constitutionality of
Election Laws, Rules and Regulations

The purpose of the writ of Certiorari is to correct grave abuse of discretion by any tribunal, board, or officer exercising
judicial or quasi-judicial functions.[21]On the other hand, the writ of Mandamus will issue to compel a tribunal,
corporation, board, officer, or person to perform an act which the law specifically enjoins as a duty.[22] True, the
COMELEC did not issue Resolution No. 7902 in the exercise of its judicial or quasi-judicial functions.[23] Nor is there a
law which specifically enjoins the COMELEC to exclude from canvassing the votes cast in Cotabato City for representative
of Shariff Kabunsuan Province with Cotabato City. These, however, do not justify the outright dismissal of the petition in
G.R. No. 177597 because Sema also prayed for the issuance of the writ of Prohibition and we have long recognized this
writ as proper for testing the constitutionality of election laws, rules, and regulations.[24]

Respondent Dilangalens Proclamation


Does Not Moot the Petition

There is also no merit in the claim that respondent Dilangalens proclamation as winner in the 14 May 2007 elections for
representative of Shariff Kabunsuan Provincewith Cotabato City mooted this petition. This case does not concern
respondent Dilangalens election. Rather, it involves an inquiry into the validity of COMELEC Resolution No. 7902, as well
as the constitutionality of MMA Act 201 and Section 19, Article VI of RA 9054. Admittedly, the outcome of this petition,
one way or another, determines whether the votes cast in Cotabato City for representative of the district
of Shariff Kabunsuan Province with Cotabato City will be included in the canvassing of ballots. However, this incidental
consequence is no reason for us not to proceed with the resolution of the novel issues raised here. The Courts ruling in
these petitions affects not only the recently concluded elections but also all the other succeeding elections for the office
in question, as well as the power of the ARMM Regional Assembly to create in the future additional provinces.

On the Main Issues

Whether the ARMM Regional Assembly Can Create the Province of Shariff Kabunsuan

The creation of local government units is governed by Section 10, Article X of the Constitution, which provides:

Sec. 10. No province, city, municipality, or barangay may be created, divided, merged, abolished or its boundary
substantially altered except in accordance with the criteria established in the local government code and subject to
approval by a majority of the votes cast in a plebiscite in the political units directly affected.

Thus, the creation of any of the four local government units province, city, municipality or barangay must comply with
three conditions. First, the creation of a local government unit must follow the criteria fixed in the Local Government
Code. Second, such creation must not conflict with any provision of the Constitution. Third, there must be a plebiscite in
the political units affected.

There is neither an express prohibition nor an express grant of authority in the Constitution for Congress to delegate to
regional or local legislative bodies the power to create local government units. However, under its plenary legislative
powers, Congress can delegate to local legislative bodies the power to create local government units, subject to
reasonable standards and provided no conflict arises with any provision of the Constitution. In fact, Congress has
delegated to provincial boards, and city and municipal councils, the power to create barangays within their
jurisdiction,[25] subject to compliance with the criteria established in the Local Government Code, and the plebiscite
requirement in Section 10, Article X of the Constitution. However, under the Local Government Code, only x x x an Act of
Congress can create provinces, cities or municipalities.[26]

Under Section 19, Article VI of RA 9054, Congress delegated to the ARMM Regional Assembly the power to create
provinces, cities, municipalities and barangays within the ARMM. Congress made the delegation under its plenary
legislative powers because the power to create local government units is not one of the express legislative powers
granted by the Constitution to regional legislative bodies.[27] In the present case, the question arises whether the
delegation to the ARMM Regional Assembly of the power to create provinces, cities, municipalities and barangays
conflicts with any provision of the Constitution.

There is no provision in the Constitution that conflicts with the delegation to regional legislative bodies of the power to
create municipalities and barangays, provided Section 10, Article X of the Constitution is followed. However, the
creation of provinces and cities is another matter. Section 5 (3), Article VI of the Constitution provides, Each city with a
population of at least two hundred fifty thousand, or each province, shall have at least one representative in the House
of Representatives. Similarly, Section 3 of the Ordinance appended to the Constitution provides, Any province that may
hereafter be created, or any city whose population may hereafter increase to more than two hundred fifty thousand
shall be entitled in the immediately following election to at least one Member x x x.

Clearly, a province cannot be created without a legislative district because it will violate Section 5 (3), Article VI of the
Constitution as well as Section 3 of the Ordinance appended to the Constitution. For the same reason, a city with a
population of 250,000 or more cannot also be created without a legislative district. Thus, the power to create a
province, or a city with a population of 250,000 or more, requires also the power to create a legislative district. Even the
creation of a city with a population of less than 250,000 involves the power to create a legislative district because once
the citys population reaches 250,000, the city automatically becomes entitled to one representative under Section 5 (3),
Article VI of the Constitution and Section 3 of the Ordinance appended to the Constitution. Thus, the power to create a
province or city inherently involves the power to create a legislative district.

For Congress to delegate validly the power to create a province or city, it must also validly delegate at the same time the
power to create a legislative district.The threshold issue then is, can Congress validly delegate to the ARMM Regional
Assembly the power to create legislative districts for the House of Representatives?The answer is in the negative.

Legislative Districts are Created or Reapportioned


Only by an Act of Congress

Under the present Constitution, as well as in past[28] Constitutions, the power to increase the allowable membership in
the House of Representatives, and to reapportion legislative districts, is vested exclusively in Congress. Section 5, Article
VI of the Constitution provides:

SECTION 5. (1) The House of Representatives shall be composed of not more than two hundred and fifty members,
unless otherwise fixed by law, who shall be elected from legislative districts apportioned among the provinces, cities,
and the Metropolitan Manila area in accordance with the number of their respective inhabitants, and on the basis of a
uniform and progressive ratio, and those who, as provided by law, shall be elected through a party-list system of
registered national, regional, and sectoral parties or organizations.

xxxx

(3) Each legislative district shall comprise, as far as practicable, contiguous, compact, and adjacent territory. Each city
with a population of at least two hundred fifty thousand, or each province, shall have at least one representative.

(4) Within three years following the return of every census, the Congress shall make a reapportionment of legislative
districts based on the standards provided in this section. (Emphasis supplied)
Section 5 (1), Article VI of the Constitution vests in Congress the power to increase, through a law, the allowable
membership in the House of Representatives.Section 5 (4) empowers Congress to reapportion legislative districts. The
power to reapportion legislative districts necessarily includes the power to create legislative districts out of existing
ones. Congress exercises these powers through a law that Congress itself enacts, and not through a law that regional or
local legislative bodies enact. The allowable membership of the House of Representatives can be increased, and new
legislative districts of Congress can be created, only through a national law passed by Congress. In Montejo v.
COMELEC,[29] we held that the power of redistricting x x x is traditionally regarded as part of the power (of Congress) to
make laws, and thus is vested exclusively in Congress.

This textual commitment to Congress of the exclusive power to create or reapportion legislative districts is logical.
Congress is a national legislature and any increase in its allowable membership or in its incumbent membership through
the creation of legislative districts must be embodied in a national law. Only Congress can enact such a law. It would be
anomalous for regional or local legislative bodies to create or reapportion legislative districts for a national legislature
like Congress. An inferior legislative body, created by a superior legislative body, cannot change the membership of the
superior legislative body.

The creation of the ARMM, and the grant of legislative powers to its Regional Assembly under its organic act, did not
divest Congress of its exclusive authority to create legislative districts. This is clear from the Constitution and the ARMM
Organic Act, as amended. Thus, Section 20, Article X of the Constitution provides:

SECTION 20. Within its territorial jurisdiction and subject to the provisions of this Constitution and national laws, the
organic act of autonomous regions shall provide for legislative powers over:
(1) Administrative organization;
(2) Creation of sources of revenues;
(3) Ancestral domain and natural resources;
(4) Personal, family, and property relations;
(5) Regional urban and rural planning development;
(6) Economic, social, and tourism development;
(7) Educational policies;
(8) Preservation and development of the cultural heritage; and
(9) Such other matters as may be authorized by law for the promotion of the general welfare of the people of the region.

Nothing in Section 20, Article X of the Constitution authorizes autonomous regions, expressly or impliedly, to create or
reapportion legislative districts for Congress.

On the other hand, Section 3, Article IV of RA 9054 amending the ARMM Organic Act, provides, The Regional Assembly
may exercise legislative power x x x except on the following matters: x x x (k) National elections. x x x. Since the ARMM
Regional Assembly has no legislative power to enact laws relating to national elections, it cannot create a legislative
district whose representative is elected in national elections. Whenever Congress enacts a law creating a legislative
district, the first representative is always elected in the next national elections from the effectivity of the law.[30]
Indeed, the office of a legislative district representative to Congress is a national office, and its occupant, a Member of
the House of Representatives, is a national official.[31] It would be incongruous for a regional legislative body like the
ARMM Regional Assembly to create a national office when its legislative powers extend only to its regional territory. The
office of a district representative is maintained by national funds and the salary of its occupant is paid out of national
funds. It is a self-evident inherent limitation on the legislative powers of every local or regional legislative body that it
can only create local or regional offices, respectively, and it can never create a national office.

To allow the ARMM Regional Assembly to create a national office is to allow its legislative powers to operate outside the
ARMMs territorial jurisdiction. This violates Section 20, Article X of the Constitution which expressly limits the coverage
of the Regional Assemblys legislative powers [w]ithin its territorial jurisdiction x x x.
The ARMM Regional Assembly itself, in creating Shariff Kabunsuan, recognized the exclusive nature of Congress power
to create or reapportion legislative districts by abstaining from creating a legislative district for Shariff Kabunsuan.
Section 5 of MMA Act 201 provides that:

Except as may be provided by national law, the existing legislative district, which includes Cotabato City as a part
thereof, shall remain. (Emphasis supplied)

However, a province cannot legally be created without a legislative district because the Constitution mandates that each
province shall have at least one representative.Thus, the creation of the Province of Shariff Kabunsuan without a
legislative district is unconstitutional.

Sema, petitioner in G.R. No. 177597, contends that Section 5 (3), Article VI of the Constitution, which provides:

Each legislative district shall comprise, as far as practicable, contiguous, compact, and adjacent territory. Each city with a
population of at least two hundred fifty thousand, or each province, shall have at least one representative. (Emphasis
supplied)

and Section 3 of the Ordinance appended to the Constitution, which states:

Any province that may hereafter be created, or any city whose population may hereafter increase to more than two
hundred fifty thousand shall be entitled in the immediately following election to at least one Member or such number of
Members as it may be entitled to on the basis of the number of its inhabitants and according to the standards set forth
in paragraph (3), Section 5 of Article VI of the Constitution. The number of Members apportioned to the province out of
which such new province was created or where the city, whose population has so increased, is geographically located
shall be correspondingly adjusted by the Commission on Elections but such adjustment shall not be made within one
hundred and twenty days before the election. (Emphasis supplied)

serve as bases for the conclusion that the Province of Shariff Kabunsuan, created on 29 October 2006, is automatically
entitled to one member in the House of Representatives in the 14 May 2007 elections. As further support for her stance,
petitioner invokes the statement in Felwa that when a province is created by statute, the corresponding representative
district comes into existence neither by authority of that statute which cannot provide otherwise nor by apportionment,
but by operation of the Constitution, without a reapportionment.

The contention has no merit.

First. The issue in Felwa, among others, was whether Republic Act No. 4695 (RA 4695), creating the provinces of
Benguet, Mountain Province, Ifugao, and Kalinga-Apayao and providing for congressional representation in the old and
new provinces, was unconstitutional for creati[ng] congressional districts without the apportionment provided in the
Constitution. The Court answered in the negative, thus:

The Constitution ordains:

The House of Representatives shall be composed of not more than one hundred and twenty Members who shall be
apportioned among the several provinces as nearly as may be according to the number of their respective inhabitants,
but each province shall have at least one Member. The Congress shall by law make an apportionment within three years
after the return of every enumeration, and not otherwise. Until such apportionment shall have been made, the House of
Representatives shall have the same number of Members as that fixed by law for the National Assembly, who shall be
elected by the qualified electors from the present Assembly districts. Each representative district shall comprise as far as
practicable, contiguous and compact territory.
Pursuant to this Section, a representative district may come into existence: (a) indirectly, through the creation of a
province for each province shall have at least one member in the House of Representatives; or (b) by direct creation of
several representative districts within a province. The requirements concerning the apportionment of representative
districts and the territory thereof refer only to the second method of creation of representative districts, and do not
apply to those incidental to the creation of provinces, under the first method. This is deducible, not only from the
general tenor of the provision above quoted, but, also, from the fact that the apportionment therein alluded to refers to
that which is made by an Act of Congress. Indeed, when a province is created by statute, the corresponding
representative district, comes into existence neither by authority of that statute which cannot provide otherwise nor by
apportionment, but by operation of the Constitution, without a reapportionment.
There is no constitutional limitation as to the time when, territory of, or other conditions under which a province may be
created, except, perhaps, if the consequence thereof were to exceed the maximum of 120 representative districts
prescribed in the Constitution, which is not the effect of the legislation under consideration. As a matter of fact,
provinces have been created or subdivided into other provinces, with the consequent creation of additional
representative districts, without complying with the aforementioned requirements.[32] (Emphasis supplied)

Thus, the Court sustained the constitutionality of RA 4695 because (1) it validly created legislative districts
indirectly through a special law enacted by Congresscreating a province and (2) the creation of the legislative districts
will not result in breaching the maximum number of legislative districts provided under the 1935
Constitution. Felwa does not apply to the present case because in Felwa the new provinces were created by a national
law enacted by Congress itself. Here, the new province was created merely by a regional law enacted by the ARMM
Regional Assembly.

What Felwa teaches is that the creation of a legislative district by Congress does not emanate alone from Congress
power to reapportion legislative districts, but also from Congress power to create provinces which cannot be created
without a legislative district. Thus, when a province is created, a legislative district is created by operation of the
Constitution because the Constitution provides that each province shall have at least one representative in the House of
Representatives. This does not detract from the constitutional principle that the power to create legislative districts
belongs exclusively to Congress. It merely prevents any other legislative body, except Congress, from creating provinces
because for a legislative body to create a province such legislative body must have the power to create legislative
districts. In short, only an act of Congress can trigger the creation of a legislative district by operation of the Constitution.
Thus, only Congress has the power to create, or trigger the creation of, a legislative district.

Moreover, if as Sema claims MMA Act 201 apportioned a legislative district to Shariff Kabunsuan upon its creation, this
will leave Cotabato City as the lone component of the first legislative district of Maguindanao. However, Cotabato City
cannot constitute a legislative district by itself because as of the census taken in 2000, it had a population of only
163,849. To constitute Cotabato City alone as the surviving first legislative district of Maguindanao will violate Section 5
(3), Article VI of the Constitution which requires that [E]ach city with a population of at least two hundred fifty thousand
x x x, shall have at least one representative.

Second. Semas theory also undermines the composition and independence of the House of Representatives. Under
Section 19,[33] Article VI of RA 9054, the ARMM Regional Assembly can create provinces and cities within the
ARMM with or without regard to the criteria fixed in Section 461 of RA 7160, namely:minimum annual income
of P20,000,000, and minimum contiguous territory of 2,000 square kilometers or minimum population of
250,000.[34] The following scenarios thus become distinct possibilities:

(1) An inferior legislative body like the ARMM Regional Assembly can create 100 or more provinces and thus increase
the membership of a superior legislative body, the House of Representatives, beyond the maximum limit of 250 fixed in
the Constitution (unless a national law provides otherwise);

(2) The proportional representation in the House of Representatives based on one representative for at least every
250,000 residents will be negated because the ARMM Regional Assembly need not comply with the requirement in
Section 461(a)(ii) of RA 7160 that every province created must have a population of at least 250,000; and

(3) Representatives from the ARMM provinces can become the majority in the House of Representatives through the
ARMM Regional Assemblys continuous creation of provinces or cities within the ARMM.
The following exchange during the oral arguments of the petition in G.R. No. 177597 highlights the absurdity of Semas
position that the ARMM Regional Assembly can create provinces:

Justice Carpio:
So, you mean to say [a] Local Government can create legislative district[s] and pack Congress with their own
representatives [?]

Atty. Vistan II:[35]


Yes, Your Honor, because the Constitution allows that.
Justice Carpio:
So, [the] Regional Assembly of [the] ARMM can create and create x x x provinces x x x and, therefore, they can have
thirty-five (35) new representatives in the House of Representatives without Congress agreeing to it, is that what you
are saying? That can be done, under your theory[?]

Atty. Vistan II:

Yes, Your Honor, under the correct factual circumstances.

Justice Carpio:
Under your theory, the ARMM legislature can create thirty-five (35) new provinces, there may be x x x [only] one
hundred thousand (100,000) [population], x x x, and they will each have one representative x x x to Congress without
any national law, is that what you are saying?

Atty. Vistan II:

Without law passed by Congress, yes, Your Honor, that is what we are saying.

xxxx
Justice Carpio:
So, they can also create one thousand (1000) new provinces, sen[d] one thousand (1000) representatives to the House
of Representatives without a national law[,] that is legally possible, correct?

Atty. Vistan II:

Yes, Your Honor.[36] (Emphasis supplied)

Neither the framers of the 1987 Constitution in adopting the provisions in Article X on regional autonomy,[37] nor
Congress in enacting RA 9054, envisioned or intended these disastrous consequences that certainly would wreck the tri-
branch system of government under our Constitution. Clearly, the power to create or reapportion legislative districts
cannot be delegated by Congress but must be exercised by Congress itself. Even the ARMM Regional Assembly
recognizes this.

The Constitution empowered Congress to create or reapportion legislative districts, not the regional assemblies. Section
3 of the Ordinance to the Constitution which states, [A]ny province that may hereafter be created x x x shall be entitled
in the immediately following election to at least one Member, refers to a province created by Congress itself through a
national law. The reason is that the creation of a province increases the actual membership of the House of
Representatives, an increase that only Congress can decide. Incidentally, in the present 14th Congress, there are
219[38] district representatives out of the maximum 250 seats in the House of Representatives. Since party-list
members shall constitute 20 percent of total membership of the House, there should at least be 50 party-list seats
available in every election in case 50 party-list candidates are proclaimed winners. This leaves only 200 seats for district
representatives, much less than the 219 incumbent district representatives. Thus, there is a need now for Congress to
increase by law the allowable membership of the House, even before Congress can create new provinces.
It is axiomatic that organic acts of autonomous regions cannot prevail over the Constitution. Section 20, Article X of the
Constitution expressly provides that the legislative powers of regional assemblies are limited [w]ithin its territorial
jurisdiction and subject to the provisions of the Constitution and national laws, x x x.The Preamble of the ARMM Organic
Act (RA 9054) itself states that the ARMM Government is established within the framework of the Constitution. This
follows Section 15, Article X of the Constitution which mandates that the ARMM shall be created x x x within the
framework of this Constitution and the national sovereignty as well as territorial integrity of the Republic of the
Philippines.

The present case involves the creation of a local government unit that necessarily involves also the creation of a
legislative district. The Court will not pass upon the constitutionality of the creation of municipalities and barangays that
does not comply with the criteria established in Section 461 of RA 7160, as mandated in Section 10, Article X of the
Constitution, because the creation of such municipalities and barangays does not involve the creation of legislative
districts. We leave the resolution of this issue to an appropriate case.

In summary, we rule that Section 19, Article VI of RA 9054, insofar as it grants to the ARMM Regional Assembly the
power to create provinces and cities, is void for being contrary to Section 5 of Article VI and Section 20 of Article X of the
Constitution, as well as Section 3 of the Ordinance appended to the Constitution. Only Congress can create provinces
and cities because the creation of provinces and cities necessarily includes the creation of legislative districts, a power
only Congress can exercise under Section 5, Article VI of the Constitution and Section 3 of the Ordinance appended to
the Constitution. The ARMM Regional Assembly cannot create a province without a legislative district because the
Constitution mandates that every province shall have a legislative district. Moreover, the ARMM Regional Assembly
cannot enact a law creating a national office like the office of a district representative of Congress because the legislative
powers of the ARMM Regional Assembly operate only within its territorial jurisdiction as provided in Section 20, Article X
of the Constitution. Thus, we rule that MMA Act 201, enacted by the ARMM Regional Assembly and creating the
Province of Shariff Kabunsuan, is void.

Resolution No. 7902 Complies with the Constitution

Consequently, we hold that COMELEC Resolution No. 7902, preserving the geographic and legislative district of the First
District of Maguindanao with Cotabato City, is valid as it merely complies with Section 5 of Article VI and Section 20 of
Article X of the Constitution, as well as Section 1 of the Ordinance appended to the Constitution.

WHEREFORE, we declare Section 19, Article VI of Republic Act No. 9054 UNCONSTITUTIONAL insofar as it grants to the
Regional Assembly of the Autonomous Region in Muslim Mindanao the power to create provinces and cities. Thus, we
declare VOID Muslim Mindanao Autonomy Act No. 201 creating the Province of Shariff Kabunsuan. Consequently, we
rule that COMELEC Resolution No. 7902 is VALID.

Let a copy of this ruling be served on the President of the Senate and the Speaker of the House of Representatives.

SO ORDERED.

ANTONIO T. CARPIO
Associate Justice
RODOLFO G. NAVARRO, VICTOR F. BERNAL, G.R. No. 180050
and
RENE O. MEDINA, Present:
Petitioners, CORONA, C.J.,
CARPIO,
- versus - CARPIO MORALES,
VELASCO, JR.,
EXECUTIVE SECRETARY EDUARDO ERMITA, NACHURA,
representing the President of the Philippines; LEONARDO-DE CASTRO,
Senate of the Philippines, represented by the BRION,
SENATE PRESIDENT; House of PERALTA,
Representatives, represented by the HOUSE BERSAMIN,
SPEAKER; GOVERNOR ROBERT ACE S. DEL CASTILLO,
BARBERS, representing the mother province ABAD,
of Surigao del Norte; GOVERNOR GERALDINE VILLARAMA, JR.,
ECLEO VILLAROMAN, representing the new PEREZ,
Province of Dinagat Islands, MENDOZA, and
Respondents, SERENO, JJ.

CONGRESSMAN FRANCISCO T. MATUGAS,


HON. SOL T. MATUGAS, HON. ARTURO
CARLOS A. EGAY, JR., HON. SIMEON VICENTE
G. CASTRENCE, HON. MAMERTO D.
GALANIDA, HON. MARGARITO M. LONGOS,
and HON. CESAR M. BAGUNDOL,
Intervenors.

Promulgated:

April 12, 2011


x-----------------------------------------------------------------------------------------x

RESOLUTION

NACHURA, J.:

For consideration of the Court is the Urgent Motion to Recall Entry of Judgment dated October 20, 2010 filed by
Movant-Intervenors[1] dated and filed on October 29, 2010, praying that the Court (a) recall the entry of judgment, and
(b) resolve their motion for reconsideration of the July 20, 2010 Resolution.

To provide a clear perspective of the instant motion, we present hereunder a brief background of the relevant
antecedents

On October 2, 2006, the President of the Republic approved into law Republic Act (R.A.) No. 9355 (An Act Creating the
Province of Dinagat Islands).[2] On December 3, 2006, the Commission on Elections (COMELEC) conducted the
mandatory plebiscite for the ratification of the creation of the province under the Local Government Code (LGC).[3] The
plebiscite yielded 69,943 affirmative votes and 63,502 negative votes.[4] With the approval of the people from both the
mother province of Surigao del
Norte and the Province of Dinagat Islands (Dinagat), the President appointed the interim set of provincial officials who
took their oath of office on January 26, 2007.Later, during the May 14, 2007 synchronized elections, the Dinagatnons
elected their new set of provincial officials who assumed office on July 1, 2007.[5]

On November 10, 2006, petitioners Rodolfo G. Navarro, Victor F. Bernal and Rene O. Medina, former political leaders of
Surigao del Norte, filed before this Court a petition for certiorari and prohibition (G.R. No. 175158) challenging the
constitutionality of R.A. No. 9355.[6] The Court dismissed the petition on technical grounds. Their motion for
reconsideration was also denied.[7]

Undaunted, petitioners, as taxpayers and residents of the Province of Surigao del Norte, filed another petition
for certiorari[8] seeking to nullify R.A. No. 9355 for being unconstitutional. They alleged that the creation of Dinagat as a
new province, if uncorrected, would perpetuate an illegal act of Congress, and would unjustly deprive the people of
Surigao del Norte of a large chunk of the provincial territory, Internal Revenue Allocation (IRA), and rich resources from
the area. They pointed out that when the law was passed, Dinagat had
a land area of 802.12 square kilometers only and a population of only 106,951, failing to comply with Section 10, Article
X of the Constitution and of Section 461 of the LGC, on both counts, viz.

Constitution, Article X Local Government

Section 10. No province, city, municipality, or barangay may be created, divided, merged, abolished, or its boundary
substantially altered, except in accordance with the criteria established in the local government code and subject to the
approval by a majority of the votes cast in a plebiscite in the political units directly affected.

LGC, Title IV, Chapter I

Section 461. Requisites for Creation. (a) A province may be created if it has an average annual income, as certified by the
Department of Finance, of not less than Twenty million pesos (P20,000,000.00) based on 1991 constant prices and
either of the following requisites:

(i) a continuous territory of at least two thousand (2,000) square kilometers, as certified by the Lands Management
Bureau; or
(ii) a population of not less than two hundred fifty thousand (250,000) inhabitants as certified by the National
Statistics Office:

Provided, That, the creation thereof shall not reduce the land area, population, and income of the original unit or units
at the time of said creation to less than the minimum requirements prescribed herein.

(b) The territory need not be contiguous if it comprises two (2) or more islands or is separated by a chartered city or
cities which do not contribute to the income of the province.

(c) The average annual income shall include the income accruing to the general fund, exclusive of special funds, trust
funds, transfers, and non-recurring income. (Emphasis supplied.)

On February 10, 2010, the Court rendered its Decision[9] granting the petition.[10] The Decision declared R.A. No. 9355
unconstitutional for failure to comply with the requirements on population and land area in the creation of a province
under the LGC. Consequently, it declared the proclamation of Dinagat and the election of its officials as null and
void. The Decision likewise declared as null and void the provision on Article 9(2) of the Rules and Regulations
Implementing the LGC (LGC-IRR), stating that, [t]he land
area requirement shall not apply where the proposed province is composed of one (1) or more islands for being beyond
the ambit of Article 461 of the LGC, inasmuch as such exemption is not expressly provided in the law.[11]
The Republic, represented by the Office of the Solicitor General, and Dinagat filed their respective motions for
reconsideration of the Decision. In its Resolution[12] dated May 12, 2010,[13] the Court denied the said motions.[14]

Unperturbed, the Republic and Dinagat both filed their respective motions for leave of court to admit their second
motions for reconsideration, accompanied by their second motions for reconsideration. These motions were eventually
noted without action by this Court in its June 29, 2010 Resolution.[15]

Meanwhile, the movants-intervenors filed on June 18, 2010 a Motion for Leave to Intervene and to File and to Admit
Intervenors Motion for Reconsideration of the Resolution dated May 12, 2010. They alleged that the COMELEC issued
Resolution No. 8790, relevant to this case, which provides

RESOLUTION NO. 8790

WHEREAS, Dinagat Islands, consisting of seven (7) municipalities, were previously components of the First Legislative
District of the Province of Surigao del Norte. In December 2006 pursuant to Republic Act No. 9355, the Province of
Dinagat Island[s] was created and its creation was ratified on 02 December 2006 in the Plebiscite for this purpose;

WHEREAS, as a province, Dinagat Islands was, for purposes of the May 10, 2010 National and Local Elections, allocated
one (1) seat for Governor, one (1) seat for Vice Governor, one (1) for congressional seat, and ten (10) Sangguniang
Panlalawigan seats pursuant to Resolution No. 8670 dated 16 September 2009;

WHEREAS, the Supreme Court in G.R. No. 180050 entitled Rodolfo Navarro, et al., vs. Executive Secretary Eduardo
Ermita, as representative of the President of the Philippines, et al. rendered a Decision, dated 10 February 2010,
declaring Republic Act No. 9355 unconstitutional for failure to comply with the criteria for the creation of a province
prescribed in Sec. 461 of the Local Government Code in relation to Sec. 10, Art. X, of the 1987 Constitution;

WHEREAS, respondents intend to file Motion[s] for Reconsideration on the above decision of the Supreme Court;

WHEREAS, the electoral data relative to the: (1) position for Member, House of Representatives representing the lone
congressional district of Dinagat Islands, (2) names of the candidates for the aforementioned position, (3) position for
Governor, Dinagat Islands, (4) names of the candidates for the said position, (5) position of the Vice Governor, (6) the
names of the candidates for the said position, (7) positions for the ten (10) Sangguniang Panlalawigan Members and, [8]
all the names of the candidates for Sangguniang Panlalawigan Members, have already been configured into the system
and can no longer be revised within the remaining period before the elections on May 10, 2010.

NOW, THEREFORE, with the current system configuration, and depending on whether the Decision of the Supreme Court
in Navarro vs. Ermita is reconsidered or not, the Commission RESOLVED, as it hereby RESOLVES, to declare that:

a. If the Decision is reversed, there will be no problem since the current system configuration is in line with the
reconsidered Decision, meaning that the Province of Dinagat Islands and the Province of Surigao del Norte remain as
two (2) separate provinces;
b. If the Decision becomes final and executory before the election, the Province of Dinagat Islands will revert to its
previous status as part of the First Legislative District, Surigao del Norte.

But because of the current system configuration, the ballots for the Province of Dinagat Islands will, for the positions of
Member, House of Representatives, Governor, Vice Governor and Members, Sangguniang Panlalawigan, bear only the
names of the candidates for the said positions.

Conversely, the ballots for the First Legislative District of Surigao del Norte, will, for the position of Governor, Vice
Governor, Member, House of Representatives, First District of Surigao del Norte and Members, Sangguniang
Panlalawigan, show only candidates for the said position. Likewise, the whole Province of Surigao del Norte, will, for the
position of Governor and Vice Governor, bear only the names of the candidates for the said position[s].
Consequently, the voters of the Province of Dinagat Islands will not be able to vote for the candidates of Members,
Sangguniang Panlalawigan, and Member, House [of] Representatives, First Legislative District, Surigao del Norte, and
candidates for Governor and Vice Governor for Surigao del Norte. Meanwhile, voters of the First Legislative District of
Surigao del Norte, will not be able to vote for Members, Sangguniang Panlalawigan and Member, House of
Representatives, Dinagat Islands.Also, the voters of the whole Province of Surigao del Norte, will not be able to vote for
the Governor and Vice Governor, Dinagat Islands. Given this situation, the Commission will postpone the elections for
Governor, Vice Governor, Member, House of Representatives, First Legislative District, Surigao del Norte, and Members,
Sangguniang Panlalawigan, First Legislative District, Surigao del Norte, because the election will result in [a] failure to
elect, since, in actuality, there are no candidates for Governor, Vice Governor, Members, Sangguniang Panlalawigan,
First Legislative District, and Member, House of Representatives, First Legislative District (with Dinagat Islands) of
Surigao del Norte.

c. If the Decision becomes final and executory after the election, the Province of Dinagat Islands will revert to its
previous status as part of the First Legislative District of Surigao del Norte. The result of the election will have to be
nullified for the same reasons given in Item b above. A special election for Governor, Vice Governor, Member, House of
Representatives, First Legislative District of Surigao del Norte, and Members, Sangguniang Panlalawigan, First District,
Surigao del Norte (with Dinagat Islands) will have to be conducted.
xxxx

SO ORDERED.

They further alleged that, because they are the duly elected officials of Surigao del Norte whose positions will be
affected by the nullification of the election results in the event that the May 12, 2010 Resolution is not reversed, they
have a legal interest in the instant case and would be directly affected by the declaration of nullity of R.A. No.
9355. Simply put, movants-intervenors election to their respective offices would necessarily be annulled since Dinagat
Islands will revert to its previous status as part of the First Legislative District of Surigao del Norte and a special election
will have to be conducted for governor, vice governor, and House of Representatives member and Sangguniang
Panlalawigan member for the First Legislative District of Surigao del Norte. Moreover, as residents of Surigao del Norte
and as public servants representing the interests of their constituents, they have a clear and strong interest in the
outcome of this case inasmuch as the reversion of Dinagat as part of the First Legislative District of Surigao del Norte will
affect the latter province such that: (1) the whole administrative set-up of the province will have to be restructured; (2)
the services of many employees will have to be terminated; (3) contracts will have to be invalidated; and (4) projects and
other developments will have to be discontinued. In addition, they claim that their rights cannot be adequately pursued
and protected in any other proceeding since their rights would be foreclosed if the May 12, 2010 Resolution would
attain finality.

In their motion for reconsideration of the May 12, 2010 Resolution, movants-intervenors raised three (3) main
arguments to challenge the above Resolution, namely:(1) that the passage of R.A. No. 9355 operates as an act of
Congress amending Section 461 of the LGC; (2) that the exemption from territorial contiguity, when the intended
province consists of two or more islands, includes the exemption from the application of the minimum land area
requirement; and (3) that the Operative Fact Doctrine is applicable in the instant case.

In the Resolution dated July 20, 2010,[16] the Court denied the Motion for Leave to Intervene and to File and to Admit
Intervenors Motion for Reconsideration of the Resolution dated May 12, 2010 on the ground that the allowance or
disallowance of a motion to intervene is addressed to the sound discretion of the Court, and that the appropriate time
to file the said motion was before and not after the resolution of this case.

On September 7, 2010, movants-intervenors filed a Motion for Reconsideration of the July 20, 2010 Resolution, citing
several rulings[17] of the Court, allowing intervention as an exception to Section 2, Rule 19 of the Rules of Court that it
should be filed at any time before the rendition of judgment. They alleged that, prior to the May 10, 2010 elections,
their legal interest in this case was not yet existent. They averred that prior to the May 10, 2010 elections, they were
unaware of the proceedings in this case. Even for the sake of argument that they had notice of the pendency of the case,
they pointed out that prior to the said elections, Sol T. Matugas was a simple resident of Surigao del Norte, Arturo Carlos
A. Egay, Jr. was a member of the Sangguniang Panlalawigan of the Second District of Surigao del Norte, and Mamerto D.
Galanida was the Municipal Mayor of Socorro, Surigao del Norte, and that, pursuant to COMELEC Resolution No. 8790, it
was only after they were elected as Governor of Surigao del Norte, Vice Governor of Surigao del Norte and Sangguniang
Panlalawigan Member of the First District of Surigao del Norte, respectively, that they became possessed with legal
interest in this controversy.

On October 5, 2010, the Court issued an order for Entry of Judgment, stating that the decision in this case had become
final and executory on May 18, 2010. Hence, the above motion.

At the outset, it must be clarified that this Resolution delves solely on the instant Urgent Motion to Recall Entry of
Judgment of movants-intervenors, not on the second motions for reconsideration of the original
parties, and neither on Dinagats Urgent Omnibus Motion, which our esteemed colleague, Mr. Justice Arturo D. Brion
considers as Dinagats third motion for reconsideration. Inasmuch as the motions for leave to admit their respective
motions for reconsideration of the May 12, 2010 Resolution and the aforesaid motions for reconsideration were already
noted without action by the Court, there is no reason to treat Dinagats Urgent Omnibus Motion differently. In relation
to this, the Urgent Motion to Recall Entry of Judgment of movants-intervenors could not be considered as a second
motion for reconsideration to warrant the application of Section 3, Rule 15 of the Internal Rules of the Supreme
Court.[18] It should be noted that this motion prays for the recall of the entry of judgment and for the resolution of their
motion for reconsideration of the July 20, 2010 Resolution which remained unresolved. The denial of their motion for
leave to intervene and to admit motion for reconsideration of the May 12, 2010 Resolution did not rule on the merits of
the motion for reconsideration of the May 12, 2010 Resolution, but only on the timeliness of the intended
intervention. Their motion for reconsideration of this denial elaborated on movants-intervenors interest in this case
which existed only after judgment had been rendered. As such, their motion for intervention and their motion for
reconsideration of the May 12, 2010 Resolution merely stand as an initial reconsideration of the said resolution.

With due deference to Mr. Justice Brion, there appears nothing in the records to support the claim that this was a ploy
of respondents legal tactician to reopen the case despite an entry of judgment. To be sure, it is actually COMELEC
Resolution No. 8790 that set this controversy into motion anew. To reiterate, the pertinent portion of the Resolution
reads:

c. If the Decision becomes final and executory after the election, the Province of Dinagat Islands will revert to its
previous status as part of the First Legislative District of Surigao del Norte. The result of the election will have to be
nullified for the same reasons given in Item b above. A special election for Governor, Vice Governor, Member, House of
Representatives, First Legislative District of Surigao del Norte, and Members, Sangguniang Panlalawigan, First District,
Surigao del Norte (with Dinagat Islands) will have to be conducted. (Emphasis supplied.)

Indeed, COMELEC Resolution No. 8790 spawned the peculiar circumstance of proper party interest for movants-
intervenors only with the specter of the decision in the main case becoming final and executory. More importantly, if
the intervention be not entertained, the movants-intervenors would be left with no other remedy as regards to the
impending nullification of their election to their respective positions. Thus, to the Courts mind, there is an imperative to
grant the Urgent Motion to Recall Entry of Judgment by movants-intervenors.

It should be remembered that this case was initiated upon the filing of the petition for certiorari way back on October
30, 2007. At that time, movants-intervenors had nothing at stake in the outcome of this case. While it may be argued
that their interest in this case should have commenced upon the issuance of COMELEC Resolution No. 8790, it is obvious
that their interest in this case then was more imaginary than real. This is because COMELEC Resolution No. 8790
provides that should the decision in this case attain finality prior to the May 10, 2010 elections, the election of the local
government officials stated therein would only have to be postponed. Given such a scenario, movants-intervenors
would not have suffered any injury or adverse effect with respect to the reversion of Dinagat as part of Surigao del Norte
since they would simply have remained candidates for the respective positions they have vied for and to which they
have been elected.

For a party to have locus standi, one must allege such a personal stake in the outcome of the controversy as to assure
that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for
illumination of difficult constitutional questions. Because constitutional cases are often public actions in which the relief
sought is likely to affect other persons, a preliminary question frequently arises as to this interest in the constitutional
question raised.[19]

It cannot be denied that movants-intervenors will suffer direct injury in the event their Urgent Motion to Recall Entry of
Judgment dated October 29, 2010 is denied and their Motion for Leave to Intervene and to File and to Admit Intervenors
Motion for Reconsideration of the Resolution dated May 12, 2010 is denied with finality.Indeed, they have sufficiently
shown that they have a personal and substantial interest in the case, such that if the May 12, 2010 Resolution be not
reconsidered, their election to their respective positions during the May 10, 2010 polls and its concomitant effects
would all be nullified and be put to naught. Given their unique circumstances, movants-intervenors should not be left
without any remedy before this Court simply because their interest in this case became manifest only after the case had
already been decided. The consequences of such a decision would definitely work to their disadvantage, nay, to their
utmost prejudice, without even them being parties to the dispute. Such decision would also violate their right to due
process, a right that cries out for protection. Thus, it is imperative that the movants-intervenors be heard on the merits
of their cause. We are not only a court of law, but also of justice and equity, such that our position and the dire
repercussions of this controversy should be weighed on the scales of justice, rather than dismissed on account of
mootness.

The moot and academic principle is not a magical formula that can automatically dissuade the courts from resolving a
case. Courts will decide cases, otherwise moot and academic, if: (1) there is a grave violation of the Constitution; (2)
there is an exceptional character of the situation and the paramount public interest is involved; (3) the constitutional
issue raised requires formation of controlling principles to guide the bench, the bar, and the public; and (4) the case is
capable of repetition yet evading review.[20] The second exception attends this case.

This Court had taken a liberal attitude in the case of David v. Macapagal-Arroyo,[21] where technicalities of procedure
on locus standi were brushed aside, because the constitutional issues raised were of paramount public interest or of
transcendental importance deserving the attention of the Court. Along parallel lines, the motion for intervention should
be given due course since movants-intervenors have shown their substantial legal interest in the outcome of this case,
even much more than petitioners themselves, and because of the novelty, gravity, and weight of the issues involved.

Undeniably, the motion for intervention and the motion for reconsideration of the May 12, 2010 Resolution of movants-
intervenors is akin to the right to appeal the judgment of a case, which, though merely a statutory right that must
comply with the requirements of the rules, is an essential part of our judicial system, such that courts should proceed
with caution not to deprive a party of the right to question the judgment and its effects, and ensure that every party-
litigant, including those who would be directly affected, would have the amplest opportunity for the proper and just
disposition of their cause, freed from the constraints of technicalities.[22]

Verily, the Court had, on several occasions, sanctioned the recall entries of judgment in light of attendant extraordinary
circumstances.[23] The power to suspend or even disregard rules of procedure can be so pervasive and compelling as to
alter even that which this Court itself had already declared final.[24] In this case, the compelling concern is not only to
afford the movants-intervenors the right to be heard since they would be adversely affected by the judgment in this
case despite not being original parties thereto, but also to arrive at the correct interpretation of the provisions of the
LGC with respect to the creation of local government units. In this manner, the thrust of the Constitution with respect to
local autonomy and of the LGC with respect to decentralization and the attainment of national goals, as hereafter
elucidated, will effectively be realized.
On the merits of the motion for intervention, after taking a long and intent look, the Court finds that the first and second
arguments raised by movants-intervenors deserve affirmative consideration.
It must be borne in mind that the central policy considerations in the creation of local government units are economic
viability, efficient administration, and capability to deliver basic services to their constituents. The criteria prescribed by
the LGC, i.e., income, population and land area, are all designed to accomplish these results.In this light, Congress, in its
collective wisdom, has debated on the relative weight of each of these three criteria, placing emphasis on which of them
should enjoy preferential consideration.

Without doubt, the primordial criterion in the creation of local government units, particularly of a province, is economic
viability. This is the clear intent of the framers of the LGC. In this connection, the following excerpts from congressional
debates are quoted hereunder

HON. ALFELOR. Income is mandatory. We can even have this doubled because we thought

CHAIRMAN CUENCO. In other words, the primordial consideration here is the economic viability of the new local
government unit, the new province?
xxxx

HON. LAGUDA. The reason why we are willing to increase the income, double than the House version, because we also
believe that economic viability is really a minimum.Land area and population are functions really of the viability of the
area, because you have an income level which would be the trigger point for economic development, population will
naturally increase because there will be an immigration. However, if you disallow the particular area from being
converted into a province because of the population problems in the beginning, it will never be able to reach the point
where it could become a province simply because it will never have the economic take off for it to trigger off that
economic development.

Now, were saying that maybe Fourteen Million Pesos is a floor area where it could pay for overhead and provide a
minimum of basic services to the population. Over and above that, the provincial officials should be able to trigger off
economic development which will attract immigration, which will attract new investments from the private sector. This
is now the concern of the local officials. But if we are going to tie the hands of the proponents, simply by telling them,
Sorry, you are now at 150 thousand or 200 thousand, you will never be able to become a province because nobody
wants to go to your place. Why? Because you never have any reason for economic viability.
xxxx

CHAIRMAN PIMENTEL. Okay, what about land area?


HON. LUMAUIG. 1,500 square kilometers
HON. ANGARA. Walang problema yon, in fact thats not very critical, yong land area because
CHAIRMAN PIMENTEL. Okay, ya, our, the Senate version is 3.5, 3,500 square meters, ah, square kilometers.
HON. LAGUDA. Ne, Ne. A province is constituted for the purpose of administrative efficiency and delivery of basic
services.
CHAIRMAN PIMENTEL. Right.
HON. LAGUDA. Actually, when you come down to it, when government was instituted, there is only one central
government and then everybody falls under that. But it was later on subdivided into provinces for purposes of
administrative efficiency.
CHAIRMAN PIMENTEL. Okay.

HON. LAGUDA. Now, what were seeing now is that the administrative efficiency is no longer there precisely because the
land areas that we are giving to our governors is so wide that no one man can possibly administer all of the complex
machineries that are needed.

Secondly, when you say delivery of basic services, as pointed out by Cong. Alfelor, there are sections of the province
which have never been visited by public officials, precisely because they dont have the time nor the energy anymore to
do that because its so wide. Now, by compressing the land area and by reducing the population requirement, we are, in
effect, trying to follow the basic policy of why we are creating provinces, which is to deliver basic services and to make it
more efficient in administration.
CHAIRMAN PIMENTEL. Yeah, thats correct, but on the assumption that the province is able to do it without being a
burden to the national government. Thats the assumption.

HON. LAGUDA. Thats why were going into the minimum income level. As we said, if we go on a minimum income level,
then we say, this is the trigger point at which this administration can take place.[25]

Also worthy of note are the requisites in the creation of a barangay, a municipality, a city, and a province as provided
both in the LGC and the LGC-IRR, viz.
For a Barangay:

LGC: SEC. 386. Requisites for Creation. (a) A barangay may be created out of a contiguous territory which has a
population of at least two thousand (2,000) inhabitants as certified by the National Statistics Office except in cities and
municipalities within Metro Manila and other metropolitan political subdivisions or in highly urbanized cities where such
territory shall have a certified population of at least five thousand (5,000) inhabitants: Provided, That the creation
thereof shall not reduce the population of the original barangay or barangays to less than the minimum requirement
prescribed herein.
To enhance the delivery of basic services in the indigenous cultural communities, barangays may be created in such
communities by an Act of Congress, notwithstanding the above requirement.

(b) The territorial jurisdiction of the new barangay shall be properly identified by metes and bounds or by more or less
permanent natural boundaries. The territory need not be contiguous if it comprises two (2) or more islands.

(c) The governor or city mayor may prepare a consolidation plan for barangays, based on the criteria prescribed in this
Section, within his territorial jurisdiction. The plan shall be submitted to the sangguniang panlalawigan or sangguniang
panlungsod concerned for appropriate action. In the case of municipalities within the Metropolitan Manila area and
other metropolitan political subdivisions, the barangay consolidation plan can be prepared and approved by the
sangguniang bayan concerned.

LGC-IRR: ARTICLE 14. Barangays. (a) Creation of barangays by the sangguniang panlalawigan shall require prior
recommendation of the sangguniang bayan.

(b) New barangays in the municipalities within MMA shall be created only by Act of Congress, subject to the limitations
and requirements prescribed in this Article.

(c) Notwithstanding the population requirement, a barangay may be created in the indigenous cultural communities by
Act of Congress upon recommendation of the LGU or LGUs where the cultural community is located.

(d) A barangay shall not be created unless the following requisites are present:

(1) Population which shall not be less than two thousand (2,000) inhabitants, except in municipalities and cities within
MMA and other metropolitan political subdivisions as may be created by law, or in highly-urbanized cities where such
territory shall have a population of at least five thousand (5,000) inhabitants, as certified by the NSO. The creation of a
barangay shall not reduce the population of the original barangay or barangays to less than the prescribed minimum/
(2) Land Area which must be contiguous, unless comprised by two (2) or more islands. The territorial jurisdiction of a
barangay sought to be created shall be properly identified by metes and bounds or by more or less permanent natural
boundaries.

Municipality:

LGC: SEC. 442. Requisites for Creation. (a) A municipality may be created if it has an average annual income, as certified
by the provincial treasurer, or at least Two million five hundred thousand pesos (P2,500,000.00) for the last two (2)
consecutive years based on the 1991 constant prices; a population of at least twenty-five thousand (25,000) inhabitants
as certified by the National Statistics Office; and a contiguous territory of at least fifty (50) square kilometers as certified
by the Lands
Management Bureau: Provided, That the creation thereof shall not reduce the land area, population or income of the
original municipality or municipalities at the time of said creation to less than the minimum requirements prescribed
herein.

(b) The territorial jurisdiction of a newly-created municipality shall be properly identified by metes and bounds. The
requirement on land area shall not apply where the municipality proposed to be created is composed of one (1) or more
islands. The territory need not be contiguous if it comprises two (2) or more islands.

(c) The average annual income shall include the income accruing to the general fund of the municipality concerned,
exclusive of special funds, transfers and non-recurring income.

(d) Municipalities existing as of the date of effectivity of this Code shall continue to exist and operate as such. Existing
municipal districts organized pursuant to presidential issuances or executive orders and which have their respective set
of elective municipal officials holding office at the time of the effectivity of this Code shall henceforth be considered
regular municipalities.

LGC-IRR: ARTICLE 13. Municipalities. (a) Requisites for Creation A municipality shall not be created unless the following
requisites are present:

(i) Income An average annual income of not less than Two Million Five Hundred Thousand Pesos
(P2,500,000.00), for the immediately preceding two (2) consecutive years based on 1991 constant prices, as certified by
the provincial treasurer. The average annual income shall include the income accruing to the general fund, exclusive of
special funds, special accounts, transfers, and nonrecurring income;
(ii) Population which shall not be less than twenty five thousand (25,000) inhabitants, as certified by NSO; and

(iii) Land area which must be contiguous with an area of at least fifty (50) square kilometers, as certified by
LMB. The territory need not be contiguous if it comprises two (2) or more islands. The requirement on land area shall
not apply where the proposed municipality is composed of one (1) or more islands. The territorial jurisdiction of a
municipality sought to be created shall be properly identified by metes and bounds.

The creation of a new municipality shall not reduce the land area, population, and income of the original LGU or LGUs at
the time of said creation to less than the prescribed minimum requirements. All expenses incidental to the creation shall
be borne by the petitioners.

City:

LGC: SEC. 450. Requisites for Creation. (a) A municipality or a cluster of barangays may be converted into a component
city if it has an average annual income, as certified by the Department of Finance, of at least Twenty million pesos
(P20,000,000.00) for the last two (2) consecutive years based on 1991 constant prices, and if it has either of the
following requisities:

(i) a contiguous territory of at least one hundred (100) square kilometers, as certified by the Lands
Management Bureau; or,
(ii) a population of not less than one hundred fifty thousand (150,000) inhabitants, as certified by the National
Statistics Office: Provided, That, the creation thereof shall not reduce the land area, population, and income of the
original unit or units at the time of said creation to less than the minimum requirements prescribed herein.

(b) The territorial jurisdiction of a newly-created city shall be properly identified by metes and bounds. The requirement
on land area shall not apply where the city proposed to be created is composed of one (1) or more islands. The territory
need not be contiguous if it comprises two (2) or more islands.
(c) The average annual income shall include the income accruing to the general fund, exclusive of special funds,
transfers, and non-recurring income.

LGC-IRR: ARTICLE 11. Cities. (a) Requisites for creation A city shall not be created unless the following requisites on
income and either population or land area are present:

(1) Income An average annual income of not less than Twenty Million Pesos (P20,000,000.00), for the immediately
preceding two (2) consecutive years based on 1991 constant prices, as certified by DOF. The average annual income shall
include the income accruing to the general fund, exclusive of special funds, special accounts, transfers, and nonrecurring
income; and
(2) Population or land area Population which shall not be less than one hundred fifty thousand (150,000) inhabitants, as
certified by the NSO; or land area which must be contiguous with an area of at least one hundred (100) square
kilometers, as certified by LMB. The territory need not be contiguous if it comprises two (2) or more islands or is
separated by a chartered city or cities which do not contribute to the income of the province. The land area requirement
shall not apply where the proposed city is composed of one (1) or more islands. The territorial jurisdiction of a city
sought to be created shall be properly identified by metes and bounds.

The creation of a new city shall not reduce the land area, population, and income of the original LGU or LGUs at the time
of said creation to less than the prescribed minimum requirements. All expenses incidental to the creation shall be
borne by the petitioners.

Provinces:

LGC: SEC. 461. Requisites for Creation. (a) A province may be created if it has an average annual income, as certified by
the Department of Finance, of not less than Twenty million pesos (P20,000,000.00) based on 1991 prices and either of
the following requisites:

(i) a contiguous territory of at least two thousand (2,000) square kilometers, as certified by the Lands
Management Bureau; or,
(ii) a population of not less than two hundred fifty thousand (250,000) inhabitants as certified by the National
Statistics Office:

Provided, That the creation thereof shall not reduce the land area, population, and income of the original unit or units at
the time of said creation to less than the minimum requirements prescribed herein.

(b) The territory need not be contiguous if it comprises two (2) or more islands or is separated by a chartered city or
cities which do not contribute to the income of the province.

(c) The average annual income shall include the income accruing to the general fund, exclusive of special funds, trust
funds, transfers, and non-recurring income.

LGC-IRR: ARTICLE 9. Provinces. (a) Requisites for creation A province shall not be created unless the following requisites
on income and either population or land area are present:

(1) Income An average annual income of not less than Twenty Million pesos (P20,000,000.00) for the immediately
preceding two (2) consecutive years based on 1991 constant prices, as certified by DOF. The average annual income shall
include the income accruing to the general fund, exclusive of special funds, special accounts, transfers, and non-
recurring income; and
(2) Population or land area Population which shall not be less than two hundred fifty thousand (250,000) inhabitants, as
certified by NSO; or land area which must be contiguous with an area of at least two thousand (2,000) square
kilometers, as certified by LMB. The territory need not be contiguous if it comprises two (2) or more islands or is
separated by a chartered city or cities which do not contribute to the income of the province. The land area requirement
shall not apply where the proposed province is composed of one (1) or more islands. The territorial jurisdiction of a
province sought to be created shall be properly identified by metes and bounds.

The creation of a new province shall not reduce the land area, population, and income of the original LGU or LGUs at the
time of said creation to less than the prescribed minimum requirements. All expenses incidental to the creation shall be
borne by the petitioners. (Emphasis supplied.)

It bears scrupulous notice that from the above cited provisions, with respect to the creation of barangays, land area is
not a requisite indicator of viability. However, with respect to the creation of municipalities, component cities, and
provinces, the three (3) indicators of viability and projected capacity to provide services, i.e., income, population, and
land area, are provided for.

But it must be pointed out that when the local government unit to be created consists of one (1) or more islands, it is
exempt from the land area requirement as expressly provided in Section 442 and Section 450 of the LGC if the local
government unit to be created is a municipality or a component city, respectively. This exemption is absent in the
enumeration of the requisites for the creation of a province under Section 461 of the LGC, although it is expressly stated
under Article 9(2) of the LGC-IRR.

There appears neither rhyme nor reason why this exemption should apply to cities and municipalities, but not to
provinces. In fact, considering the physical configuration of the Philippine archipelago, there is a greater likelihood that
islands or group of islands would form part of the land area of a newly-created province than in most cities or
municipalities. It is, therefore, logical to infer that the genuine legislative policy decision was expressed in Section 442
(for municipalities) and Section 450 (for component cities) of the LGC, but was inadvertently omitted in Section 461 (for
provinces). Thus, when the exemption was expressly provided in Article 9(2) of the LGC-IRR, the inclusion was intended
to correct the congressional oversight in Section 461 of the LGC and to reflect the true legislative intent. It would, then,
be in order for the Court to uphold the validity of Article 9(2) of the LGC-IRR.
This interpretation finds merit when we consider the basic policy considerations underpinning the principle of local
autonomy.

Section 2 of the LGC, of which paragraph (a) is pertinent to this case, provides

Sec. 2. Declaration of Policy. (a) It is hereby declared the policy of the State that the territorial and political subdivisions
of the State shall enjoy genuine and meaningful local autonomy to enable them to attain their fullest development as
self-reliant communities and make them more effective partners in the attainment of national goals. Toward this end,
the State shall provide for a more responsive and accountable local government structure instituted through a system of
decentralization whereby local government units shall be given more powers, authority, responsibilities, and
resources. The process of decentralization shall proceed from the national government to the local government units.

This declaration of policy is echoed in Article 3(a) of the LGC-IRR[26] and in the Whereas clauses of Administrative Order
No. 270,[27] which read

WHEREAS, Section 25, Article II of the Constitution mandates that the State shall ensure the autonomy of local
governments;

WHEREAS, pursuant to this declared policy, Republic Act No. 7160, otherwise known as the Local Government Code of
1991, affirms, among others, that the territorial and political subdivisions of the State shall enjoy genuine and
meaningful local autonomy to enable them to attain their fullest development as self-reliant communities and make
them more effective partners in the attainment of national goals;

WHEREAS, Section 533 of the Local Government Code of 1991 requires the President to convene an Oversight
Committee for the purpose of formulating and issuing the appropriate rules and regulations necessary for the efficient
and effective implementation of all the provisions of the said Code; and
WHEREAS, the Oversight Committee, after due deliberations and consultations with all the concerned sectors of society
and consideration of the operative principles of local autonomy as provided in the Local Government Code of 1991, has
completed the formulation of the implementing rules and regulations; x x x

Consistent with the declared policy to provide local government units genuine and meaningful local autonomy,
contiguity and minimum land area requirements for prospective local government units should be liberally construed in
order to achieve the desired results. The strict interpretation adopted by the February 10, 2010 Decision could prove to
be counter-productive, if not outright absurd, awkward, and impractical. Picture an intended province that consists of
several municipalities and component cities which, in themselves, also consist of islands. The component cities and
municipalities which consist of islands are exempt from the minimum land area requirement, pursuant to Sections 450
and 442, respectively, of the LGC. Yet, the province would be made to comply with the minimum land area criterion of
2,000 square kilometers, even if it consists of several islands. This would mean that Congress has opted to assign a
distinctive preference to create a province with contiguous land area over one composed of islands and negate the
greater imperative of development of self-reliant communities, rural progress, and the delivery of basic services to the
constituency. This preferential option would prove more difficult and burdensome if the 2,000-square-kilometer
territory of a province is scattered because the islands are separated by bodies of water, as compared to one with a
contiguous land mass.

Moreover, such a very restrictive construction could trench on the equal protection clause, as it actually defeats the
purpose of local autonomy and decentralization as enshrined in the Constitution. Hence, the land area requirement
should be read together with territorial contiguity.

Another look at the transcript of the deliberations of Congress should prove enlightening:

CHAIRMAN ALFELOR. Can we give time to Congressman Chiongbian,[28] with respect to his

CHAIRMAN LINA. Okay.

HON. CHIONGBIAN. At the outset, Chairman Lina, we would like to apprise the distinguished Senator about the action
taken by the House, on House Bill No. 7166. This was passed about two years ago and has been pending in the Senate
for consideration. This is a bill that I am not the only one involved, including our distinguished Chairman here. But then
we did want to sponsor the bill, being the Chairman then of the Local Government.

So, I took the cudgels for the rest of the Congressmen, who were more or less interested in the creation of the new
provinces, because of the vastness of the areas that were involved.

At any rate, this bill was passed by the House unanimously without any objection. And as I have said a while ago, that
this has been pending in the Senate for the last two years.And Sen. Pimentel himself was just in South Cotabato and he
delivered a speech that he will support this bill, and he says, that he will incorporate this in the Local Government Code,
which I have in writing from him. I showed you the letter that he wrote, and naturally, we in the House got hold of the
Senate version. It becomes an impossibility for the whole Philippines to create a new province, and that is quite the
concern of the respective Congressmen.

Now, insofar as the constitutional provision is concerned, there is nothing to stop the mother province from voting
against the bill, if a province is going to be created.

So, we are talking about devolution of powers here. Why is the province not willing to create another province, when it
can be justified. Even Speaker Mitra says, what will happen to Palawan? We wont have one million people there, and if
you look at Palawan, there will be about three or four provinces that will comprise that island. So, the development will
be hampered.

Now, I would like to read into the record the letter of Sen. Pimentel, dated November 2, 1989. This was practically about
a year after 7166 was approved by the House, House Bill 7166.
On November 2, 1989, the Senator wrote me:

Dear Congressman Chiongbian:

We are in receipt of your letter of 17 October. Please be informed that your House No. 7166 was incorporated in the
proposed Local Government Code, Senate Bill No. 155, which is pending for second reading.

Thank you and warm regards.

Very truly yours,

That is the very context of the letter of the Senator, and we are quite surprised that the Senate has adopted another
position.

So, we would like because this is a unanimously approved bill in the House, thats the only bill that is involving the
present Local Government Code that we are practically considering; and this will be a slap on the House, if we do not
approve it, as approved by the lower House. This can be [an] irritant in the approval of the Conference Committee
Report. And I just want to manifest that insofar as the creation of the province, not only in my province, but the other
provinces. That the mother province will participate in the plebiscite, they can defeat the province, lets say, on the basis
of the result, the province cannot be created if they lose in the plebiscite, and I dont see why, we should put this
stringent conditions to the private people of the devolution that they are seeking.

So, Mr. Senator, I think we should consider the situation seriously, because, this is an approved version of the House,
and I will not be the one to raise up and question the Conference Committee Report, but the rest of the House that are
interested in this bill. And they have been approaching the Speaker about this. So, the Speaker reminded me to make
sure that it takes the cudgel of the House approved version.

So, thats all what I can say, Mr. Senator, and I dont believe that it is not, because its the wish of the House, but because
the mother province will participate anyhow, you vote them down; and that is provided for in the Constitution. As a
matter of fact, I have seen the amendment with regards to the creation of the city to be urbanized, subject to the
plebiscite.And why should we not allow that to happen in the provinces! In other words, we dont want the people who
wants to create a new province, as if they are left in the devolution of powers, when they feel that they are far away
from civilization.

Now, I am not talking about other provinces, because I am unaware, not aware of their situation. But
the province of South Cotabato has a very unique geographical territorial conglomerations. One side is in the other side
of the Bay, of Sarangani Bay. The capital town is in the North; while these other municipalities are in the East and in the
West. And if they have to travel from the last town in the eastern part of the province, it is about one hundred forty
kilometers to the capital town. And from the West side, it is the same distance. And from the North side, it is about one
hundred kilometers. So that is the problem there. And besides, they have enough resources and I feel that, not because I
am interested in the province, I am after their welfare in the future. Who am I to dictate on those people? I have no
interest but then I am looking at the future development of these areas.

As a matter of fact, if I am in politics, its incidental; I do not need to be there, but I can foresee what the creation of a
new province will bring to these people. It will bring them prosperity; it will bring them more income, and it will
encourage even foreign investors. Like the PAP now, they are concentrating in South Cotabato, especially in the City of
General Santos and the neighboring municipalities, and they are quite interested and even the AID people are asking
me, What is holding the creation of a new province when practically you need it? Its not 20 or 30 kilometers from the
capital town; its about 140 kilometers. And imagine those people have to travel that far and our road is not like
Metropolitan Manila. That is as far as from here to Tarlac. And there are municipalities there that are just one
municipality is bigger than the province of La Union. They have the income. Of course, they dont have the population
because thats a part of the land of promise and people from Luzon are migrating everyday because they feel that there
are more opportunities here.

So, by creating the new provinces, not only in my case, in the other cases, it will enhance the development of
the Philippines, not because I am interested in my province. Well, as far as I am concerned, you know, I am in the
twilight years of my life to serve and I would like to serve my people well. No personal or political interest here. I hope
the distinguished Chairman of the Committee will appreciate the House Bill 7166, which the House has already approved
because we dont want them to throw the Conference Committee Report after we have worked that the house Bill has
been, you know, drawn over board and not even considered by the Senate. And on top of that, we are considering a bill
that has not yet been passed. So I hope the Senator will take that into account.

Thank you for giving me this time to explain.

CHAIRMAN LINA. Thank you very much, Congressman James. We will look into the legislative history of the Senate
version on this matter of creation of provinces. I am sure there was an amendment. As I said, Ill look into it. Maybe the
House version was incorporated in toto, but maybe during the discussion, their amendments were introduced and,
therefore, Senator Pimentel could not hold on to the original version and as a result new criteria were introduced.

But because of the manifestation that you just made, we will definitely, when we reach a book, Title IV, on the matter of
provinces, we will look at it sympathetically from your end so that the objective that you want [to] achieve can be
realized. So we will look at it with sympathy. We will review our position on the matter, how we arrived at the Senate
version and we will adopt an open mind definitely when we come into it.

CHAIRMAN ALFELOR. Kanino yan?


CHAIRMAN LINA. Book III.
CHAIRMAN ALFELOR. Title?
CHAIRMAN LINA. Title IV.

CHAIRMAN ALFELOR. I have been pondering on the case of James, especially on economic stimulation of a certain
area. Like our case, because I put myself on our province, our province is quite very big. Its composed of four (4)
congressional districts and I feel it should be five now. But during the Batasan time, four of us talked and conversed
proposing to divide the province into two.

There are areas then, when since time immemorial, very few governors ever tread on those areas. That is, maybe youre
acquainted with the Bondoc Peninsula of Quezon, fronting that is Ragay Gulf. From Ragay there is a long stretch of
coastal area. From Albay going to Ragay, very few governors ever tread [there] before, even today. That area now is
infested with NPA. That is the area of Congressman Andaya.

Now, we thought that in order to stimulate growth, maybe provincial aid can be extended to these areas. With a big or a
large area of a province, a certain administrator or provincial governor definitely will have no sufficient time. For me, if
we really would like to stimulate growth, I believe that an area where there is physical or geographical impossibilities,
where administrators can penetrate, I think we have to create certain provisions in the law where maybe we can treat it
with special considerations.

Now, we went over the graduate scale of the Philipppine Local Government Data as far as provinces are concerned. It is
very surprising that there are provinces here which only composed of six municipalities, eight municipalities, seven
municipalities. Like in Cagayan, Tuguegarao, there are six municipalities. Ah, excuse me, Batanes.

CHAIRMAN LINA. Will you look at the case of --- how many municipalities are there in Batanes province?
CHAIRMAN ALFELOR. Batanes is only six.
CHAIRMAN LINA. Six town. Siquijor?
CHAIRMAN ALFELOR. Siquijor. It is region?
CHAIRMAN LINA. Seven.
CHAIRMAN ALFELOR.L Seven. Anim.
CHAIRMAN LINA. Six also.
CHAIRMAN ALFELOR. Six also.
CHAIRMAN LINA. It seems with a minimum number of towns?
CHAIRMAN ALFELOR. The population of Siquijor is only 70 thousand, not even one congressional district. But tumaas in
1982. Camiguin, that is Region 9. Wala dito.Nagtataka nga ako ngayon.
CHAIRMAN LINA. Camiguin, Camiguin.
CHAIRMAN ALFELOR. That is region? Camiguin has five municipalities, with a population of 63 thousand. But we do not
hold it against the province because maybe thats one stimulant where growth can grow, can start. The land area for
Camiguin is only 229 square kilometers. So if we hard fast on requirements of, we set a minimum for every province,
palagay ko we just leave it to legislation, eh. Anyway, the Constitution is very clear that in case we would like to divide,
we submit it to a plebiscite. Pabayaan natin ang tao. Kung maglalagay tayo ng set ng minimum, tila yata mahihirapan
tayo, eh. Because what is really the thrust of the Local Government Code? Growth. To devolve powers in order for the
community to have its own idea how they will stimulate growth in their respective areas.

So, in every geographical condition, mayroon sariling id[i]osyncracies eh, we cannot make a generalization.

CHAIRMAN LINA. Will the creation of a province, carved out of the existing province because of some geographical
id[i]osyncracies, as you called it, stimulate the economic growth in the area or will substantial aid coming from the
national government to a particular area, say, to a municipality, achieve the same purpose?

CHAIRMAN ALFELOR. Ano tayo dito sa budget. All right, here is a province. Usually, tinitingnan lang yun, provision eh,
hindi na yung composition eh. You are entitled to, say, 20% of the area.

Theres a province of Camarines Sur which have the same share with that of Camiguin and Siquijor, but Camiguin is
composed only of five municipalities; in Siquijor, its composed of six, but the share of Siquijor is the same share with
that of the province of Camarines Sur, having a bigger area, very much bigger.

That is the budget in process.

CHAIRMAN LINA. Well, as I said, we are going to consider this very seriously and even with sympathy because of the
explanation given and we will study this very carefully.[29]

The matters raised during the said Bicameral Conference Committee meeting clearly show the manifest intention of
Congress to promote development in the previously underdeveloped and uninhabited land areas
by allowing them to directly share in the allocation of funds under the national budget. It should be remembered that,
under Sections 284 and 285 of the LGC, the IRA is given back to local governments, and the sharing is based on land
area, population, and local revenue.[30]

Elementary is the principle that, if the literal application of the law results in absurdity, impossibility, or injustice, then
courts may resort to extrinsic aids of statutory construction, such as the legislative history of the law,[31] or may
consider the implementing rules and regulations and pertinent executive issuances in the nature of executive and/or
legislative construction. Pursuant to this principle, Article 9(2) of the LGC-IRR should be deemed incorporated in the
basic law, the LGC.

It is well to remember that the LGC-IRR was formulated by the Oversight Committee consisting of members of both the
Executive and Legislative departments, pursuant to Section 533[32] of the LGC. As Section 533 provides, the Oversight
Committee shall formulate and issue the appropriate rules and regulations necessary for the efficient and effective
implementation of any and all provisions of this Code, thereby ensuring compliance with the principles of local
autonomy as defined under the Constitution. It was also mandated by the Constitution that a local government code
shall be enacted by Congress, to wit
Section 3. The Congress shall enact a local government code which shall provide for a more responsive and accountable
local government structure instituted through a system of decentralization with effective mechanisms of recall,
initiative, and referendum, allocate among the different local government units their powers, responsibilities, and
resources, and provide for the qualifications, election, appointment and removal, term, salaries, powers and functions
and duties of local officials, and all other matters relating to the organization and operation of the local units. (Emphasis
supplied.)

These State policies are the very reason for the enactment of the LGC, with the view to attain decentralization and
countryside development. Congress saw that the old LGC, Batas Pambansa Bilang 337, had to be replaced with a new
law, now the LGC of 1991, which is more dynamic and cognizant of the needs of the Philippines as an archipelagic
country. This accounts for the exemption from the land area requirement of local government units composed of one or
more islands, as expressly stated under Sections 442 and 450 of the LGC, with respect to the creation of municipalities
and cities, but inadvertently omitted from Section 461 with respect to the creation of provinces. Hence, the void or
missing detail was filled in by the Oversight Committee in the LGC-IRR.

With three (3) members each from both the Senate and the House of Representatives, particularly the chairpersons of
their respective Committees on Local Government, it cannot be gainsaid that the inclusion by the Oversight Committee
of the exemption from the land area requirement with respect to the creation of provinces consisting of one (1) or more
islands was intended by Congress, but unfortunately not expressly stated in Section 461 of the LGC, and this intent was
echoed through an express provision in the LGC-IRR. To be sure, the Oversight Committee did not just arbitrarily and
whimsically insert such an exemption in Article 9(2) of the LGC-IRR. The Oversight Committee evidently conducted due
deliberation and consultations with all the concerned sectors of society and considered the operative principles of local
autonomy as provided in the LGC when the IRR was formulated.[33] Undoubtedly, this amounts not only to an executive
construction, entitled to great weight and respect from this Court,[34] but to legislative construction as well, especially
with the inclusion of representatives from the four leagues of local government units as members of the Oversight
Committee.

With the formulation of the LGC-IRR, which amounted to both executive and legislative construction of the LGC, the
many details to implement the LGC had already been put in place, which Congress understood to be impractical and not
too urgent to immediately translate into direct amendments to the LGC. But Congress, recognizing the capacity and
viability of Dinagat to become a full-fledged province, enacted R.A. No. 9355, following the exemption from the land
area requirement, which, with respect to the creation of provinces, can only be found as an express provision in the
LGC-IRR. In effect, pursuant to its plenary legislative powers, Congress breathed flesh and blood into that exemption in
Article 9(2) of the LGC-IRR and transformed it into law when it enacted R.A. No. 9355 creating the Island Province of
Dinagat.

Further, the bill that eventually became R.A. No. 9355 was filed and favorably voted upon in both Chambers of
Congress. Such acts of both Chambers of Congress definitively show the clear legislative intent to incorporate into the
LGC that exemption from the land area requirement, with respect to the creation of a province when it consists of one
or more islands, as expressly provided only in the LGC-IRR. Thereby, and by necessity, the LGC was amended by way of
the enactment of R.A. No. 9355.

What is more, the land area, while considered as an indicator of viability of a local government unit, is not conclusive in
showing that Dinagat cannot become a province, taking into account its average annual income of P82,696,433.23 at the
time of its creation, as certified by the Bureau of Local Government Finance, which is four times more than the minimum
requirement of P20,000,000.00 for the creation of a province. The delivery of basic services to its constituents has been
proven possible and sustainable. Rather than looking at the results of the plebiscite and the May 10, 2010 elections as
mere fait accompli circumstances which cannot operate in favor of Dinagats existence as a province, they must be seen
from the perspective that Dinagat is ready and capable of becoming a province. This Court should not be instrumental in
stunting such capacity. As we have held in League of Cities of the Philippines v. Commission on Elections[35]
Ratio legis est anima. The spirit rather than the letter of the law. A statute must be read according to its spirit or intent,
for what is within the spirit is within the statute although it is not within its letter, and that which is within the letter but
not within the spirit is not within the statute. Put a bit differently, that which is within the intent of the lawmaker is as
much within the statute as if within the letter, and that which is within the letter of the statute is not within the statute
unless within the intent of the lawmakers.Withal, courts ought not to interpret and should not accept an interpretation
that would defeat the intent of the law and its legislators.
So as it is exhorted to pass on a challenge against the validity of an act of Congress, a co-equal branch of government, it
behooves the Court to have at once one principle in mind: the presumption of constitutionality of statutes. This
presumption finds its roots in the tri-partite system of government and the corollary separation of powers, which
enjoins the three great departments of the government to accord a becoming courtesy for each others acts, and not to
interfere inordinately with the exercise by one of its official functions.Towards this end, courts ought to reject assaults
against the validity of statutes, barring of course their clear unconstitutionality. To doubt is to sustain, the theory in
context being that the law is the product of earnest studies by Congress to ensure that no constitutional prescription or
concept is infringed. Consequently, before a law duly challenged is nullified, an unequivocal breach of, or a clear conflict
with, the Constitution, not merely a doubtful or argumentative one, must be demonstrated in such a manner as to leave
no doubt in the mind of the Court.

WHEREFORE, the Court resolved to:

1. GRANT the Urgent Motion to Recall Entry of Judgment by movants-intervenors, dated and filed on October 29, 2010;

2. RECONSIDER and SET ASIDE the July 20, 2010 Resolution, and GRANT the Motion for Leave to Intervene and to File
and to Admit Intervenors Motion for Reconsideration of the Resolution dated July 20, 2010;

3. GRANT the Intervenors Motion for Reconsideration of the Resolution dated May 12, 2010. The May 12, 2010
Resolution is RECONSIDERED and SET ASIDE. The provision in Article 9(2) of the Rules and Regulations Implementing the
Local Government Code of 1991 stating, The land area requirement shall not apply where the proposed province is
composed of one (1) or more islands, is declared VALID. Accordingly, Republic Act No. 9355 (An Act Creating the
Province of Dinagat Islands) is declared as VALID and CONSTITUTIONAL, and the proclamation of the Province of Dinagat
Islands and the election of the officials thereof are declared VALID; and

4. The petition is DISMISSED.

No pronouncement as to costs.

SO ORDERED.
G.R. No. L-49112 February 2, 1979
LEOVILLO C. AGUSTIN, petitioner,
vs.
HON. ROMEO F. EDU, in his capacity as Land Transportation Commissioner; HON. JUAN PONCE ENRILE, in his capacity
as Minister of National Defense; HON. ALFREDO L. JUINIO, in his capacity as Minister Of Public Works, Transportation
and Communications; and HON: BALTAZAR AQUINO, in his capacity as Minister of Public Highways, respondents.
Leovillo C. Agustin Law Office for petitioner.
Solicitor General Estelito P. Mendoza, Assistant Solicitor General Ruben E. Agpalo and Solicitor Amado D. Aquino for
respondents.
FERNANDO, J.:
The validity of a letter of Instruction 1 providing for an early seaming device for motor vehicles is assailed in this
prohibition proceeding as being violative of the constitutional guarantee of due process and, insofar as the rules and
regulations for its implementation are concerned, for transgressing the fundamental principle of non- delegation of
legislative power. The Letter of Instruction is stigmatized by petitioner who is possessed of the requisite standing, as
being arbitrary and oppressive. A temporary restraining order as issued and respondents Romeo F. Edu, Land
Transportation Commissioner Juan Ponce Enrile, Minister of National Defense; Alfredo L. Juinio, Minister of Public
Works, Transportation and Communications; and Baltazar Aquino, Minister of Public Highways; were to answer. That
they did in a pleading submitted by Solicitor General Estelito P. Mendoza. 2 Impressed with a highly persuasive quality, it
makes devoid clear that the imputation of a constitutional infirmity is devoid of justification The Letter of Instruction on
is a valid police power measure. Nor could the implementing rules and regulations issued by respondent Edu be
considered as amounting to an exercise of legislative power. Accordingly, the petition must be dismissed.
The facts are undisputed. The assailed Letter of Instruction No. 229 of President Marcos, issued on December 2, 1974,
reads in full: "[Whereas], statistics show that one of the major causes of fatal or serious accidents in land transportation
is the presence of disabled, stalled or parked motor vehicles along streets or highways without any appropriate early
warning device to signal approaching motorists of their presence; [Whereas], the hazards posed by such obstructions to
traffic have been recognized by international bodies concerned with traffic safety, the 1968 Vienna Convention on Road
Signs and Signals and the United Nations Organization (U.N.); [Whereas], the said Vienna Convention which was ratified
by the Philippine Government under P.D. No. 207, recommended the enactment of local legislation for the installation
of road safety signs and devices; [Now, therefore, I, Ferdinand E. Marcos], President of the Philippines, in the interest of
safety on all streets and highways, including expressways or limited access roads, do hereby direct: 1. That all owners,
users or drivers of motor vehicles shall have at all times in their motor vehicles at least one (1) pair of early warning
device consisting of triangular, collapsible reflectorized plates in red and yellow colors at least 15 cms. at the base and
40 cms. at the sides. 2. Whenever any motor vehicle is stalled or disabled or is parked for thirty (30) minutes or more on
any street or highway, including expressways or limited access roads, the owner, user or driver thereof shall cause the
warning device mentioned herein to be installed at least four meters away to the front and rear of the motor vehicle
staged, disabled or parked. 3. The Land Transportation Commissioner shall cause Reflectorized Triangular Early Warning
Devices, as herein described, to be prepared and issued to registered owners of motor vehicles, except motorcycles and
trailers, charging for each piece not more than 15 % of the acquisition cost. He shall also promulgate such rules and
regulations as are appropriate to effectively implement this order. 4. All hereby concerned shall closely coordinate and
take such measures as are necessary or appropriate to carry into effect then instruction. 3 Thereafter, on November 15,
1976, it was amended by Letter of Instruction No. 479 in this wise. "Paragraph 3 of Letter of Instruction No. 229 is
hereby amended to read as follows: 3. The Land transportation Commissioner shall require every motor vehicle owner
to procure from any and present at the registration of his vehicle, one pair of a reflectorized early warning device, as d
bed of any brand or make chosen by mid motor vehicle . The Land Transportation Commissioner shall also promulgate
such rule and regulations as are appropriate to effectively implement this order.'" 4 There was issued accordingly, by
respondent Edu, the implementing rules and regulations on December 10, 1976. 5 They were not enforced as President
Marcos on January 25, 1977, ordered a six-month period of suspension insofar as the installation of early warning device
as a pre-registration requirement for motor vehicle was concerned. 6 Then on June 30, 1978, another Letter of
Instruction 7 the lifting of such suspension and directed the immediate implementation of Letter of Instruction No. 229
as amended. 8 It was not until August 29, 1978 that respondent Edu issued Memorandum Circular No. 32, worded thus:
"In pursuance of Letter of Instruction No. 716, dated June 30, 1978, the implementation of Letter of Instruction No. 229,
as amended by Letter of Instructions No. 479, requiring the use of Early Warning Devices (EWD) on motor vehicle, the
following rules and regulations are hereby issued: 1. LTC Administrative Order No. 1, dated December 10, 1976; shall
now be implemented provided that the device may come from whatever source and that it shall have substantially
complied with the EWD specifications contained in Section 2 of said administrative order; 2. In order to insure that every
motor vehicle , except motorcycles, is equipped with the device, a pair of serially numbered stickers, to be issued free of
charge by this Commission, shall be attached to each EWD. The EWD. serial number shall be indicated on the
registration certificate and official receipt of payment of current registration fees of the motor vehicle concerned. All
Orders, Circulars, and Memoranda in conflict herewith are hereby superseded, This Order shall take effect
immediately. 9 It was for immediate implementation by respondent Alfredo L. Juinio, as Minister of Public Works,
transportation, and Communications. 10
Petitioner, after setting forth 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," 11 alleged that said Letter of Instruction No. 229, as amended, "clearly violates the provisions and
delegation of police power, [sic] * * *: " For him they are "oppressive, unreasonable, arbitrary, confiscatory, nay
unconstitutional and contrary to the precepts of our compassionate New Society." 12 He contended that they are
"infected with arbitrariness because it is harsh, cruel and unconscionable to the motoring public;" 13 are "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." 14 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 EWD's." 15 He therefore prayed for a judgment both the
assailed Letters of Instructions and Memorandum Circular void and unconstitutional and for a restraining order in the
meanwhile.
A resolution to this effect was handed down by this Court on October 19, 1978: "L-49112 (Leovillo C. Agustin v. Hon.
Romeo F. Edu, etc., et al.) — Considering the allegations contained, the issues raised and the arguments adduced in the
petition for prohibition with writ of p prohibitory and/or mandatory injunction, the Court Resolved to (require) the
respondents to file an answer thereto within ton (10) days from notice and not to move to dismiss the petition. The
Court further Resolved to [issue] a [temporary restraining order] effective as of this date and continuing until otherwise
ordered by this Court.16
Two motions for extension were filed by the Office of the Solicitor General and granted. Then on November 15, 1978, he
Answer for respondents was submitted. After admitting the factual allegations and stating that they lacked knowledge
or information sufficient to form a belief as to petitioner owning a Volkswagen Beetle car," they "specifically deny the
allegations and stating they lacked knowledge or information sufficient to form a belief as to petitioner owning a
Volkswagen Beetle Car, 17 they specifically deny the allegations in paragraphs X and XI (including its subparagraphs 1, 2,
3, 4) of Petition to the effect that Letter of Instruction No. 229 as amended by Letters of Instructions Nos. 479 and 716
as well as Land transportation Commission Administrative Order No. 1 and its Memorandum Circular No. 32 violates the
constitutional provisions on due process of law, equal protection of law and undue delegation of police power, and that
the same are likewise oppressive, arbitrary, confiscatory, one-sided, onerous, immoral unreasonable and illegal the truth
being that said allegations are without legal and factual basis and for the reasons alleged in the Special and Affirmative
Defenses of this Answer."18 Unlike petitioner who contented himself with a rhetorical recital of his litany of grievances
and merely invoked the sacramental phrases of constitutional litigation, the Answer, in demonstrating that the assailed
Letter of Instruction was a valid exercise of the police power and implementing rules and regulations of respondent Edu
not susceptible to the charge that there was unlawful delegation of legislative power, there was in the portion captioned
Special and Affirmative Defenses, a citation of what respondents believed to be the authoritative decisions of this
Tribunal calling for application. They are Calalang v. Williams, 19 Morfe v. Mutuc, 20 and Edu v. Ericta. 21 Reference was
likewise made to the 1968 Vienna Conventions of the United Nations on road traffic, road signs, and signals, of which
the Philippines was a signatory and which was duly ratified. 22 Solicitor General Mendoza took pains to refute in detail,
in language calm and dispassionate, the vigorous, at times intemperate, accusation of petitioner that the assailed Letter
of Instruction and the implementing rules and regulations cannot survive the test of rigorous scrutiny. To repeat, its
highly-persuasive quality cannot be denied.
This Court thus considered the petition submitted for decision, the issues being clearly joined. As noted at the outset, it
is far from meritorious and must be dismissed.
1. The Letter of Instruction in question was issued in the exercise of the police power. That is conceded by petitioner and
is the main reliance of respondents. It is the submission of the former, however, that while embraced in such a category,
it has offended against the due process and equal protection safeguards of the Constitution, although the latter point
was mentioned only in passing. The broad and expansive scope of the police power which was originally Identified by
Chief Justice Taney of the American Supreme Court in an 1847 decision as "nothing more or less than the powers of
government inherent in every sovereignty" 23 was stressed in the aforementioned case of Edu v. Ericta thus: "Justice
Laurel, in the first leading decision after the Constitution came into force, Calalang v. Williams, Identified police power
with state authority to enact legislation that may interfere with personal liberty or property in order to promote the
general welfare. Persons and property could thus 'be subjected to all kinds of restraints and burdens in order to we the
general comfort, health and prosperity of the state.' Shortly after independence in 1948, Primicias v. Fugoso reiterated
the doctrine, such a competence being referred to as 'the power to prescribe regulations to promote the health, morals,
peace, education, good order or safety, and general welfare of the people. The concept was set forth in negative terms
by Justice Malcolm in a pre-Commonwealth decision as 'that inherent and plenary power in the State which enables it to
prohibit all things hurtful to the comfort, safety and welfare of society. In that sense it could be hardly distinguishable as
noted by this Court in Morfe v. Mutuc with the totality of legislative power. It is in the above sense the greatest and
most powerful at. tribute of government. It is, to quote Justice Malcolm anew, 'the most essential, insistent, and at least
table powers, I extending as Justice Holmes aptly pointed out 'to all the great public needs.' Its scope, ever-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. In the language of
Justice Cardozo: 'Needs that were narrow or parochial in the past may be interwoven in the present with the well-being
of the nation. What is critical or urgent changes with the time.' The police power is thus a dynamic agency, suitably
vague and far from precisely defined, rooted in the conception that men in organizing the state and imposing upon its
government limitations to safeguard constitutional rights did not intend thereby to enable an individual citizen or a
group of citizens to obstruct unreasonably the enactment of such salutary measures calculated to communal peace,
safety, good order, and welfare." 24
2. It was thus a heavy burden to be shouldered by petitioner, compounded by the fact that the particular police power
measure challenged was clearly intended to promote public safety. It would be a rare occurrence indeed for this Court
to invalidate a legislative or executive act of that character. None has been called to our attention, an indication of its
being non-existent. The latest decision in point, Edu v. Ericta, sustained the validity of the Reflector Law, 25 an
enactment conceived with the same end in view. Calalang v. Williams found nothing objectionable in a statute, the
purpose of which was: "To promote safe transit upon, and. avoid obstruction on roads and streets designated as
national roads * * *. 26 As a matter of fact, the first law sought to be nullified after the effectivity of the 1935
Constitution, the National Defense Act, 27 with petitioner failing in his quest, was likewise prompted by the imperative
demands of public safety.
3. The futility of petitioner's effort to nullify both the Letter of Instruction and the implementing rules and regulations
becomes even more apparent considering his failure to lay the necessary factual foundation to rebut the presumption of
validity. So it was held in Ermita-Malate Hotel and Motel Operators Association, Inc. v. City Mayor of Manila. 28 The
rationale was clearly set forth in an excerpt from a decision of Justice Branders of the American Supreme Court, quoted
in the opinion: "The statute here questioned deals with a subject clearly within the scope of the police power. We are
asked to declare it void on the ground that the specific method of regulation prescribed is unreasonable and hence
deprives the plaintiff of due process of law. As underlying questions of fact may condition the constitutionality of
legislation of this character, the presumption of constitutionality must prevail in the absence of some factual foundation
of record in overthrowing the statute. 29
4. Nor did the Solicitor General as he very well could, rely solely on such rebutted presumption of validity. As was
pointed out in his Answer "The President certainly had in his possession the necessary statistical information and data at
the time he issued said letter of instructions, and such factual foundation cannot be defeated by petitioner's naked
assertion that early warning devices 'are not too vital to the prevention of nighttime vehicular accidents' because
allegedly only 390 or 1.5 per cent of the supposed 26,000 motor vehicle accidents that in 1976 involved rear-end
collisions (p. 12 of petition). Petitioner's statistics is not backed up by demonstrable data on record. As aptly stated by
this Honorable Court: Further: "It admits of no doubt therefore that there being a presumption of validity, the necessity
for evidence to rebut it is unavoidable, unless the statute or ordinance is void on its face, which is not the case here"' * *
*. But even as g the verity of petitioner's statistics, is that not reason enough to require the installation of early warning
devices to prevent another 390 rear-end collisions that could mean the death of 390 or more Filipinos and the deaths
that could likewise result from head-on or frontal collisions with stalled vehicles?" 30 It is quite manifest then that the
issuance of such Letter of Instruction is encased in the armor of prior, careful study by the Executive Department. To set
it aside for alleged repugnancy to the due process clause is to give sanction to conjectural claims that exceeded even the
broadest permissible limits of a pleader's well known penchant for exaggeration.
5. The rather wild and fantastic nature of the charge of oppressiveness of this Letter of Instruction was exposed in the
Answer of the Solicitor General thus: "Such early warning device requirement is not an expensive redundancy, nor
oppressive, for car owners whose cars are already equipped with 1) blinking lights in the fore and aft of said motor
vehicles,' 2) "battery-powered blinking lights inside motor vehicles," 3) "built-in reflectorized tapes on front and rear
bumpers of motor vehicles," or 4) "well-lighted two (2) petroleum lamps (the Kinke) * * * because: Being universal
among the signatory countries to the said 1968 Vienna Conventions, and visible even under adverse conditions at a
distance of at least 400 meters, any motorist from this country or from any part of the world, who sees a reflectorized
rectangular early seaming device installed on the roads, highways or expressways, will conclude, without thinking, that
somewhere along the travelled portion of that road, highway, or expressway, there is a motor vehicle which is
stationary, stalled or disabled which obstructs or endangers passing traffic. On the other hand, a motorist who sees any
of the aforementioned other built in warning devices or the petroleum lamps will not immediately get adequate
advance warning because he will still think what that blinking light is all about. Is it an emergency vehicle? Is it a law
enforcement car? Is it an ambulance? Such confusion or uncertainty in the mind of the motorist will thus increase,
rather than decrease, the danger of collision. 31
6. Nor did the other extravagant assertions of constitutional deficiency go unrefuted in the Answer of the Solicitor
General "There is nothing in the questioned Letter of Instruction No. 229, as amended, or in Administrative Order No. 1,
which requires or compels motor vehicle owners to purchase the early warning device prescribed thereby. All that is
required is for motor vehicle owners concerned like petitioner, to equip their motor vehicles with a pair of this early
warning device in question, procuring or obtaining the same from whatever source. In fact, with a little of industry and
practical ingenuity, motor vehicle owners can even personally make or produce this early warning device so long as the
same substantially conforms with the specifications laid down in said letter of instruction and administrative order.
Accordingly the early warning device requirement can neither be oppressive, onerous, immoral, nor confiscatory, much
less does it make manufacturers and dealers of said devices 'instant millionaires at the expense of car owners' as
petitioner so sweepingly concludes * * *. Petitioner's fear that with the early warning device requirement 'a more subtle
racket may be committed by those called upon to enforce it * * * is an unfounded speculation. Besides, that
unscrupulous officials may try to enforce said requirement in an unreasonable manner or to an unreasonable degree,
does not render the same illegal or immoral where, as in the instant case, the challenged Letter of Instruction No. 229
and implementing order disclose none of the constitutional defects alleged against it.32
7 It does appear clearly that petitioner's objection to this Letter of Instruction is not premised on lack of power, the
justification for a finding of unconstitutionality, but on the pessimistic, not to say negative, view he entertains as to its
wisdom. That approach, it put it at its mildest, is distinguished, if that is the appropriate word, by its unorthodoxy. It
bears repeating "that this Court, in the language of Justice Laurel, 'does not pass upon questions of wisdom justice or
expediency of legislation.' As expressed by Justice Tuason: 'It is not the province of the courts to supervise legislation
and keep it within the bounds of propriety and common sense. That is primarily and exclusively a legislative concern.'
There can be no possible objection then to the observation of Justice Montemayor. 'As long as laws do not violate any
Constitutional provision, the Courts merely interpret and apply them regardless of whether or not they are wise or
salutary. For they, according to Justice Labrador, 'are not supposed to override legitimate policy and * * * never inquire
into the wisdom of the law.' It is thus settled, to paraphrase Chief Justice Concepcion in Gonzales v. Commission on
Elections, that only congressional power or competence, not the wisdom of the action taken, may be the basis for
declaring a statute invalid. This is as it ought to be. The principle of separation of powers has in the main wisely allocated
the respective authority of each department and confined its jurisdiction to such a sphere. There would then be
intrusion not allowable under the Constitution if on a matter left to the discretion of a coordinate branch, the judiciary
would substitute its own. If there be adherence to the rule of law, as there ought to be, the last offender should be
courts of justice, to which rightly litigants submit their controversy precisely to maintain unimpaired the supremacy of
legal norms and prescriptions. The attack on the validity of the challenged provision likewise insofar as there may be
objections, even if valid and cogent on is wisdom cannot be sustained. 33
8. The alleged infringement of the fundamental principle of non-delegation of legislative power is equally without any
support well-settled legal doctrines. Had petitioner taken the trouble to acquaint himself with authoritative
pronouncements from this Tribunal, he would not have the temerity to make such an assertion. An exempt from the
aforecited decision of Edu v. Ericta sheds light on the matter: "To avoid the taint of unlawful delegation, there must be a
standard, which implies at the very least that the legislature itself determines matters of principle and lays down
fundamental policy. Otherwise, the charge of complete abdication may be hard to repel A standard thus defines
legislative policy, marks its maps out its boundaries and specifies the public agency to apply it. It indicates the
circumstances under which the legislative command is to be effected. It is the criterion by which legislative purpose may
be carried out. Thereafter, the executive or administrative office designated may in pursuance of the above guidelines
promulgate supplemental rules and regulations. The standard may be either express or implied. If the former, the non-
delegation objection is easily met. The standard though does not have to be spelled out specifically. It could be implied
from the policy and purpose of the act considered as a whole. In the Reflector Law clearly, the legislative objective is
public safety. What is sought to be attained as in Calalang v. Williams is "safe transit upon the roads.' This is to adhere to
the recognition given expression by Justice Laurel in a decision announced not too long after the Constitution came into
force and effect that the principle of non-delegation "has been made to adapt itself to the complexities of modern
governments, giving rise to the adoption, within certain limits, of the principle of "subordinate legislation" not only in
the United States and England but in practically all modern governments.' He continued: 'Accordingly, with the growing
complexity of modern life, the multiplication of the subjects of governmental regulation, and the increased difficulty of
administering the laws, there is a constantly growing tendency toward the delegation of greater powers by the
legislature and toward the approval of the practice by the courts.' Consistency with the conceptual approach requires
the reminder that what is delegated is authority non-legislative in character, the completeness of the statute when it
leaves the hands of Congress being assumed." 34
9. The conclusion reached by this Court that this petition must be dismissed is reinforced by this consideration. The
petition itself quoted these two whereas clauses of the assailed Letter of Instruction: "[Whereas], the hazards posed by
such obstructions to traffic have been recognized by international bodies concerned with traffic safety, the 1968 Vienna
Convention on Road Signs and Signals and the United Nations Organization (U.N.); [Whereas], the said Vionna
Convention, which was ratified by the Philippine Government under P.D. No. 207, recommended the enactment of local
legislation for the installation of road safety signs and devices; * * * " 35 It cannot be disputed then that this 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 land * * *." 36 The 1968 Vienna Convention on Road Signs and
Signals is impressed with such a character. It is not for this country to repudiate a commitment to which it had pledged
its word. The concept of Pacta sunt servanda stands in the way of such an attitude, which is, moreover, at war with the
principle of international morality.
10. That is about all that needs be said. The rather court reference to equal protection did not even elicit any attempt on
the Part of Petitioner to substantiate in a manner clear, positive, and categorical why such a casual observation should
be taken seriously. In no case is there a more appropriate occasion for insistence on what was referred to as "the
general rule" in Santiago v. Far Eastern Broadcasting Co., 37 namely, "that the constitutionality of a law wig not be
considered unless the point is specially pleaded, insisted upon, and adequately argued." 38 "Equal protection" is not a
talismanic formula at the mere invocation of which a party to a lawsuit can rightfully expect that success will crown his
efforts. The law is anything but that.
WHEREFORE, this petition is dismissed. The restraining order is lifted. This decision is immediately executory. No costs.
Castro, C.J., Barredo, Antonio, Santos, Fernandez, Guerrero, Abad Santos, De Castro and Melencio-Herrera, concur.
Makasiar, J, reserves the right to file a separate opinion.
Aquino J., took no part.
Concepcion J., is on leave.
Castro, C.J., certifies that Justice Concepcion concurs in their decision.

G.R. No. 92389 September 11, 1991


HON. JEJOMAR C. BINAY and the MUNICIPALITY OF MAKATI, petitioners,
vs.
HON. EUFEMIO DOMINGO and the COMMISSION ON AUDIT, respondents.
Jejomar C. Binay for himself and for his co-petitioner.
Manuel D. Tamase and Rafael C. Marquez for respondents.

PARAS, J.:
The only pivotal issue before Us is whether or not Resolution No. 60, re-enacted under Resolution No. 243, of the
Municipality of Makati is a valid exercise of police power under the general welfare clause.
The pertinent facts are:
On September 27, 1988, petitioner Municipality, through its Council, approved Resolution No. 60 which reads:
A RESOLUTION TO CONFIRM AND/OR RATIFY THE ONGOING BURIAL ASSISTANCE PROGRAM INITIATED BY THE OFFICE
OF THE MAYOR, OF EXTENDING FINANCIAL ASSISTANCE OF FIVE HUNDRED PESOS (P500.00) TO A BEREAVED FAMILY,
FUNDS TO BE TAKEN OUT OF UNAPPROPRIATED AVAILABLE FUNDS EXISTING IN THE MUNICIPAL TREASURY. (Rollo,
Annnex "A" p. 39)
Qualified beneficiaries, under the Burial Assistance Program, are bereaved families of Makati whose gross family income
does not exceed two thousand pesos (P2,000.00) a month. The beneficiaries, upon fulfillment of other requirements,
would receive the amount of five hundred pesos (P500.00) cash relief from the Municipality of Makati. (Reno, Annex
"13", p. 41)
Metro Manila Commission approved Resolution No. 60. Thereafter, the municipal secretary certified a disbursement
fired of four hundred thousand pesos (P400,000.00) for the implementation of the Burial Assistance Program. (Rollo,
Annex "C", p. 43).
Resolution No. 60 was referred to respondent Commission on Audit (COA) for its expected allowance in audit. Based on
its preliminary findings, respondent COA disapproved Resolution No. 60 and disallowed in audit the disbursement of
finds for the implementation thereof. (Rollo, Annex "D", P. 44)
Two letters for reconsideration (Annexes "E" and "F", Rollo, pp. 45 and 48, respectively) filed by petitioners Mayor
Jejomar Binay, were denied by respondent in its Decision No. 1159, in the following manner:
Your request for reconsideration is predicated on the following grounds, to wit:
1. Subject Resolution No. 60, s. 1988, of the Municipal Council of Makati and the intended disbursements fall within the
twin principles of 'police power and parens patriae and
2. The Metropolitan Manila Commission (MMC), under a Certification, dated June 5, 1989, has already appropriated the
amount of P400,000.00 to implement the Id resolution, and the only function of COA on the matter is to allow the
financial assistance in question.
The first contention is believed untenable. Suffice it to state that:
a statute or ordinance must have a real substantial, or rational relation to the public safety, health, morals, or general
welfare to be sustained as a legitimate exercise of the police power. The mere assertion by the legislature that a statute
relates to the public health, safety, or welfare does not in itself bring the statute within the police power of a state for
there must always be an obvious and real connection between the actual provisions of a police regulations and its
avowed purpose, and the regulation adopted must be reasonably adapted to accomplish the end sought to be attained.
16 Am. Jur 2d, pp. 542-543; emphasis supplied).
Here, we see no perceptible connection or relation between the objective sought to be attained under Resolution No.
60, s. 1988, supra, and the alleged public safety, general welfare, etc. of the inhabitants of Makati.
Anent the second contention, let it be stressed that Resolution No. 60 is still subject to the limitation that the
expenditure covered thereby should be for a public purpose, i.e., that the disbursement of the amount of P500.00 as
burial assistance to a bereaved family of the Municipality of Makati, or a total of P400,000.00 appropriated under the
Resolution, should be for the benefit of the whole, if not the majority, of the inhabitants of the Municipality and not for
the benefit of only a few individuals as in the present case. On this point government funds or property shall be spent or
used solely for public purposes. (Cf. Section 4[2], P.D. 1445). (pp. 50-51, Rollo)
Bent on pursuing the Burial Assistance Program the Municipality of Makati, through its Council, passed Resolution No.
243, re-affirming Resolution No. 60 (Rollo, Annex "H", p. 52).
However, the Burial Assistance Program has been stayed by COA Decision No. 1159. Petitioner, through its Mayor, was
constrained to file this special civil action of certiorari praying that COA Decision No. 1159 be set aside as null and void.
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 (Balacuit v. CFI of Agusan del Norte, 163 SCRA
182). Before a municipal corporation may exercise such power, there must be a valid delegation of such power by the
legislature which is the repository of the inherent powers of the State. A valid delegation of police power may arise from
express delegation, or be inferred from the mere fact of the creation of the municipal corporation; and as a general rule,
municipal corporations may exercise police powers within the fair intent and purpose of their creation which are
reasonably proper to give effect to the powers expressly granted, and statutes conferring powers on public corporations
have been construed as empowering them to do the things essential to the enjoyment of life and desirable for the safety
of the people. (62 C.J.S., p. 277). The so-called inferred police powers of such corporations are as much delegated
powers as are those conferred in express terms, the inference of their delegation growing out of the fact of the creation
of the municipal corporation and the additional fact that the corporation can only fully accomplish the objects of its
creation by exercising such powers. (Crawfordsville vs. Braden, 28 N.E. 849). Furthermore, municipal corporations, as
governmental agencies, must have such measures of the power as are necessary to enable them to perform their
governmental functions. The power is a continuing one, founded on public necessity. (62 C.J.S. p. 273) Thus, not only
does the State effectuate its purposes through the exercise of the police power but the municipality does also. (U.S. v.
Salaveria, 39 Phil. 102).
Municipal governments exercise this power under the general welfare clause: pursuant thereto they are clothed with
authority to "enact such ordinances and issue such regulations as may be necessary to carry out and discharge the
responsibilities conferred upon it by law, and such as shall be necessary and proper to provide for the health, safety,
comfort and convenience, maintain peace and order, improve public morals, promote the prosperity and general
welfare of the municipality and the inhabitants thereof, and insure the protection of property therein." (Sections 91,
149, 177 and 208, BP 337). And under Section 7 of BP 337, "every local government unit shall exercise the powers
expressly granted, those necessarily implied therefrom, as well as powers necessary and proper for governance such as
to promote health and safety, enhance prosperity, improve morals, and maintain peace and order in the local
government unit, and preserve the comfort and convenience of the inhabitants therein."
Police power 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 the most essential, insistent, and illimitable of powers. In a sense it is the
greatest and most powerful attribute of the government. It is elastic and must be responsive to various social conditions.
(Sangalang, et al. vs. IAC, 176 SCRA 719). On it depends the security of social order, the life and health of the citizen, the
comfort of an existence in a thickly populated community, the enjoyment of private and social life, and the beneficial
use of property, and it has been said to be the very foundation on which our social system rests. (16 C.J.S., P. 896)
However, it is not confined within narrow circumstances of precedents resting on past conditions; it must follow the
legal progress of a democratic way of life. (Sangalang, et al. vs. IAC, supra).
In the case at bar, COA is of the position that there is "no perceptible connection or relation between the objective
sought to be attained under Resolution No. 60, s. 1988, supra, and the alleged public safety, general welfare. etc. of the
inhabitants of Makati." (Rollo, Annex "G", p. 51).
Apparently, COA tries to re-define the scope of police power by circumscribing its exercise to "public safety, general
welfare, etc. of the inhabitants of Makati."
In the case of Sangalang vs. IAC, supra, We ruled that 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 (62 C.J.S. Sec. 128). Thus, it is deemed inadvisable to attempt to frame any
definition which shall absolutely indicate the limits of police power.
COA's additional objection is based on its contention that "Resolution No. 60 is still subject to the limitation that the
expenditure covered thereby should be for a public purpose, ... should be for the benefit of the whole, if not the
majority, of the inhabitants of the Municipality and not for the benefit of only a few individuals as in the present case."
(Rollo, Annex "G", p. 51).
COA is not attuned to the changing of the times. Public purpose is not unconstitutional merely because it incidentally
benefits a limited number of persons. As correctly pointed out by the Office of the Solicitor General, "the drift is towards
social welfare legislation geared towards state policies to provide adequate social services (Section 9, Art. II,
Constitution), the promotion of the general welfare (Section 5, Ibid) social justice (Section 10, Ibid) as well as human
dignity and respect for human rights. (Section 11, Ibid." (Comment, p. 12)
The care for the poor is generally recognized as a public duty. The support for the poor has long been an accepted
exercise of police power in the promotion of the common good.
There is no violation of the equal protection clause in classifying paupers as subject of legislation. Paupers may be
reasonably classified. Different groups may receive varying treatment. Precious to the hearts of our legislators, down to
our local councilors, is the welfare of the paupers. Thus, statutes have been passed giving rights and benefits to the
disabled, emancipating the tenant-farmer from the bondage of the soil, housing the urban poor, etc.
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.
PREMISES CONSIDERED, and with the afore-mentioned caveat, this petition is hereby GRANTED and the Commission on
Audit's Decision No. 1159 is hereby SET ASIDE.
SO ORDERED.
Fernan, C.J., Narvasa, Melencio-Herrera, Cruz, Padilla, Bidin, Sarmiento, Griño-Aquino, Medialdea, Regalado and Davide,
Jr., JJ., concur.
Gutierrez, Jr. and Feliciano, JJ., are on leave.
G.R. No. L-34915 June 24, 1983
CITY GOVERNMENT OF QUEZON CITY and CITY COUNCIL OF QUEZON CITY, petitioners,
vs.
HON. JUDGE VICENTE G. ERICTA as Judge of the Court of First Instance of Rizal, Quezon City, Branch XVIII; HIMLAYANG
PILIPINO, INC., respondents.
City Fiscal for petitioners.
Manuel Villaruel, Jr. and Feliciano Tumale for respondents.

GUTIERREZ, JR., J.:


This is a petition for review which seeks the reversal of the decision of the Court of First Instance of Rizal, Branch XVIII
declaring Section 9 of Ordinance No. 6118, S-64, of the Quezon City Council null and void.
Section 9 of Ordinance No. 6118, S-64, entitled "ORDINANCE REGULATING THE ESTABLISHMENT, MAINTENANCE AND
OPERATION OF PRIVATE MEMORIAL TYPE CEMETERY OR BURIAL GROUND WITHIN THE JURISDICTION OF QUEZON CITY
AND PROVIDING PENALTIES FOR THE VIOLATION THEREOF" provides:
Sec. 9. At least six (6) percent of the total area of the memorial park cemetery shall be set aside for charity burial of
deceased persons who are paupers and have been residents of Quezon City for at least 5 years prior to their death, to be
determined by competent City Authorities. The area so designated shall immediately be developed and should be open
for operation not later than six months from the date of approval of the application.
For several years, the aforequoted section of the Ordinance was not enforced by city authorities but seven years after
the enactment of the ordinance, the Quezon City Council passed the following resolution:
RESOLVED by the council of Quezon assembled, to request, as it does hereby request the City Engineer, Quezon City, to
stop any further selling and/or transaction of memorial park lots in Quezon City where the owners thereof have failed to
donate the required 6% space intended for paupers burial.
Pursuant to this petition, the Quezon City Engineer notified respondent Himlayang Pilipino, Inc. in writing that Section 9
of Ordinance No. 6118, S-64 would be enforced
Respondent Himlayang Pilipino reacted by filing with the Court of First Instance of Rizal Branch XVIII at Quezon City, a
petition for declaratory relief, prohibition and mandamus with preliminary injunction (Sp. Proc. No. Q-16002) seeking to
annul Section 9 of the Ordinance in question The respondent alleged that the same is contrary to the Constitution, the
Quezon City Charter, the Local Autonomy Act, and the Revised Administrative Code.
There being no issue of fact and the questions raised being purely legal both petitioners and respondent agreed to the
rendition of a judgment on the pleadings. The respondent court, therefore, rendered the decision declaring Section 9 of
Ordinance No. 6118, S-64 null and void.
A motion for reconsideration having been denied, the City Government and City Council filed the instant petition.
Petitioners argue that the taking of the respondent's property is a valid and reasonable exercise of police power and that
the land is taken for a public use as it is intended for the burial ground of paupers. They further argue that the Quezon
City Council is authorized under its charter, in the exercise of local police power, " to make such further ordinances and
resolutions not repugnant to law as may be necessary to carry into effect and discharge the powers and duties conferred
by this Act and such as it shall deem necessary and proper to provide for the health and safety, promote the prosperity,
improve the morals, peace, good order, comfort and convenience of the city and the inhabitants thereof, and for the
protection of property therein."
On the other hand, respondent Himlayang Pilipino, Inc. contends that the taking or confiscation of property is obvious
because the questioned ordinance permanently restricts the use of the property such that it cannot be used for any
reasonable purpose and deprives the owner of all beneficial use of his property.
The respondent also stresses that the general welfare clause is not available as a source of power for the taking of the
property in this case because it refers to "the power of promoting the public welfare by restraining and regulating the
use of liberty and property." The respondent points out that if an owner is deprived of his property outright under the
State's police power, the property is generally not taken for public use but is urgently and summarily destroyed in order
to promote the general welfare. The respondent cites the case of a nuisance per se or the destruction of a house to
prevent the spread of a conflagration.
We find the stand of the private respondent as well as the decision of the respondent Judge to be well-founded. We
quote with approval the lower court's ruling which declared null and void Section 9 of the questioned city ordinance:
The issue is: Is Section 9 of the ordinance in question a valid exercise of the police power?
An examination of the Charter of Quezon City (Rep. Act No. 537), does not reveal any provision that would justify the
ordinance in question except the provision granting police power to the City. Section 9 cannot be justified under the
power granted to Quezon City to tax, fix the license fee, and regulate such other business, trades, and occupation as
may be established or practised in the City.' (Subsections 'C', Sec. 12, R.A. 537).
The power to regulate does not include the power to prohibit (People vs. Esguerra, 81 PhiL 33, Vega vs. Municipal Board
of Iloilo, L-6765, May 12, 1954; 39 N.J. Law, 70, Mich. 396). A fortiori, the power to regulate does not include the power
to confiscate. The ordinance in question not only confiscates but also prohibits the operation of a memorial park
cemetery, because under Section 13 of said ordinance, 'Violation of the provision thereof is punishable with a fine
and/or imprisonment and that upon conviction thereof the permit to operate and maintain a private cemetery shall be
revoked or cancelled.' The confiscatory clause and the penal provision in effect deter one from operating a memorial
park cemetery. Neither can the ordinance in question be justified under sub- section "t", Section 12 of Republic Act 537
which authorizes the City Council to-
'prohibit the burial of the dead within the center of population of the city and provide for their burial in such proper
place and in such manner as the council may determine, subject to the provisions of the general law regulating burial
grounds and cemeteries and governing funerals and disposal of the dead.' (Sub-sec. (t), Sec. 12, Rep. Act No. 537).
There is nothing in the above provision which authorizes confiscation or as euphemistically termed by the respondents,
'donation'
We now come to the question whether or not Section 9 of the ordinance in question is a valid exercise of police power.
The police power of Quezon City is defined in sub-section 00, Sec. 12, Rep. Act 537 which reads as follows:
(00) To make such further ordinance and regulations not repugnant to law as may be necessary to carry into effect and
discharge the powers and duties conferred by this act and such as it shall deem necessary and proper to provide for the
health and safety, promote, the prosperity, improve the morals, peace, good order, comfort and convenience of the city
and the inhabitants thereof, and for the protection of property therein; and enforce obedience thereto with such lawful
fines or penalties as the City Council may prescribe under the provisions of subsection (jj) of this section.
We start the discussion with a restatement of certain basic principles. Occupying the forefront in the bill of rights is the
provision which states that 'no person shall be deprived of life, liberty or property without due process of law' (Art. Ill,
Section 1 subparagraph 1, Constitution).
On the other hand, there are three inherent powers of government by which the state interferes with the property
rights, namely-. (1) police power, (2) eminent domain, (3) taxation. These are said to exist independently of the
Constitution as necessary attributes of sovereignty.
Police power is defined by Freund as 'the power of promoting the public welfare by restraining and regulating the use of
liberty and property' (Quoted in Political Law by Tanada and Carreon, V-11, p. 50). It is usually exerted in order to merely
regulate the use and enjoyment of property of the owner. If he is deprived of his property outright, it is not taken for
public use but rather to destroy in order to promote the general welfare. In police power, the owner does not recover
from the government for injury sustained in consequence thereof (12 C.J. 623). It has been said that police power is the
most essential of government powers, at times the most insistent, and always one of the least limitable of the powers of
government (Ruby vs. Provincial Board, 39 PhiL 660; Ichong vs. Hernandez, 1,7995, May 31, 1957). This power embraces
the whole system of public regulation (U.S. vs. Linsuya Fan, 10 PhiL 104). The Supreme Court has said that police power
is so far-reaching in scope that it has almost become 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. Being coextensive with self-
preservation and survival itself, it is the most positive and active of all governmental processes, the most essential
insistent and illimitable Especially it is so under the modern democratic framework where the demands of society and
nations have multiplied to almost unimaginable proportions. The field and scope of police power have become almost
boundless, just as the fields of public interest and public welfare have become almost all embracing and have
transcended human foresight. Since the Courts cannot foresee the needs and demands of public interest and welfare,
they cannot delimit beforehand the extent or scope of the police power by which and through which the state seeks to
attain or achieve public interest and welfare. (Ichong vs. Hernandez, L-7995, May 31, 1957).
The police power being the most active power of the government and the due process clause being the broadest station
on governmental power, the conflict between this power of government and the due process clause of the Constitution
is oftentimes inevitable.
It will be seen from the foregoing authorities that police power is usually exercised in the form of mere regulation or
restriction in the use of liberty or property for the promotion of the general welfare. It does not involve the taking or
confiscation of property with the exception of a few cases where there is a necessity to confiscate private property in
order to destroy it for the purpose of protecting the peace and order and of promoting the general welfare as for
instance, the confiscation of an illegally possessed article, such as opium and firearms.
It seems to the court that Section 9 of Ordinance No. 6118, Series of 1964 of Quezon City is not a mere police regulation
but an outright confiscation. It deprives a person of his private property without due process of law, nay, even without
compensation.
In sustaining the decision of the respondent court, we are not unmindful of the heavy burden shouldered by whoever
challenges the validity of duly enacted legislation whether national or local As early as 1913, this Court ruled in Case v.
Board of Health (24 PhiL 250) that the courts resolve every presumption in favor of validity and, more so, where the ma
corporation asserts that the ordinance was enacted to promote the common good and general welfare.
In the leading case of Ermita-Malate Hotel and Motel Operators Association Inc. v. City Mayor of Manila (20 SCRA 849)
the Court speaking through the then Associate Justice and now Chief Justice Enrique M. Fernando stated
Primarily what calls for a reversal of such a decision is the a of any evidence to offset the presumption of validity that
attaches to a statute or ordinance. As was expressed categorically by Justice Malcolm 'The presumption is all in favor of
validity. ... The action of the elected representatives of the people cannot be lightly set aside. The councilors must, in the
very nature of things, be familiar with the necessities of their particular ... municipality and with all the facts and lances
which surround the subject and necessitate action. The local legislative body, by enacting the ordinance, has in effect
given notice that the regulations are essential to the well-being of the people. ... The Judiciary should not lightly set
aside legislative action when there is not a clear invasion of personal or property rights under the guise of police
regulation. (U.S. v. Salaveria (1918], 39 Phil. 102, at p. 111. There was an affirmation of the presumption of validity of
municipal ordinance as announced in the leading Salaveria decision in Ebona v. Daet, [1950]85 Phil. 369.)
We have likewise considered the principles earlier stated in Case v. Board of Health supra :
... Under the provisions of municipal charters which are known as the general welfare clauses, a city, by virtue of its
police power, may adopt ordinances to the peace, safety, health, morals and the best and highest interests of the
municipality. It is a well-settled principle, growing out of the nature of well-ordered and society, that every holder of
property, however absolute and may be his title, holds it under the implied liability that his use of it shall not be
injurious to the equal enjoyment of others having an equal right to the enjoyment of their property, nor injurious to the
rights of the community. An property in the state is held subject to its general regulations, which are necessary to the
common good and general welfare. Rights of property, like all other social and conventional rights, are subject to such
reasonable limitations in their enjoyment as shall prevent them from being injurious, and to such reasonable restraints
and regulations, established by law, as the legislature, under the governing and controlling power vested in them by the
constitution, may think necessary and expedient. The state, under the police power, is possessed with plenary power to
deal with all matters relating to the general health, morals, and safety of the people, so long as it does not contravene
any positive inhibition of the organic law and providing that such power is not exercised in such a manner as to justify
the interference of the courts to prevent positive wrong and oppression.
but find them not applicable to the facts of this case.
There is no reasonable relation between the setting aside of at least six (6) percent of the total area of an private
cemeteries for charity burial grounds of deceased paupers and the promotion of health, morals, good order, safety, or
the general welfare of the people. The ordinance is actually a taking without compensation of a certain area from a
private cemetery to benefit paupers who are charges of the municipal corporation. Instead of building or maintaining a
public cemetery for this purpose, the city passes the burden to private cemeteries.
The expropriation without compensation of a portion of private cemeteries is not covered by Section 12(t) of Republic
Act 537, the Revised Charter of Quezon City which empowers the city council to prohibit the burial of the dead within
the center of population of the city and to provide for their burial in a proper place subject to the provisions of general
law regulating burial grounds and cemeteries. When the Local Government Code, Batas Pambansa Blg. 337 provides in
Section 177 (q) that a Sangguniang panlungsod may "provide for the burial of the dead in such place and in such manner
as prescribed by law or ordinance" it simply authorizes the city to provide its own city owned land or to buy or
expropriate private properties to construct public cemeteries. This has been the law and practise in the past. It
continues to the present. Expropriation, however, requires payment of just compensation. The questioned ordinance is
different from laws and regulations requiring owners of subdivisions to set aside certain areas for streets, parks,
playgrounds, and other public facilities from the land they sell to buyers of subdivision lots. The necessities of public
safety, health, and convenience are very clear from said requirements which are intended to insure the development of
communities with salubrious and wholesome environments. The beneficiaries of the regulation, in turn, are made to pay
by the subdivision developer when individual lots are sold to home-owners.
As a matter of fact, the petitioners rely solely on the general welfare clause or on implied powers of the municipal
corporation, not on any express provision of law as statutory basis of their exercise of power. The clause has always
received broad and liberal interpretation but we cannot stretch it to cover this particular taking. Moreover, the
questioned ordinance was passed after Himlayang Pilipino, Inc. had incorporated. received necessary licenses and
permits and commenced operating. The sequestration of six percent of the cemetery cannot even be considered as
having been impliedly acknowledged by the private respondent when it accepted the permits to commence operations.
WHEREFORE, the petition for review is hereby DISMISSED. The decision of the respondent court is affirmed.
SO ORDERED.
Teehankee (Chairman), Melencio-Herrera, Plana, Vasquez and Relova, JJ., concur.
G.R. No. 81958 June 30, 1988
PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS, INC., petitioner,
vs.
HON. FRANKLIN M. DRILON as Secretary of Labor and Employment, and TOMAS D. ACHACOSO, as Administrator of
the Philippine Overseas Employment Administration, respondents.
Gutierrez & Alo Law Offices for petitioner.

SARMIENTO, J.:
The petitioner, Philippine Association of Service Exporters, Inc. (PASEI, for short), a firm "engaged principally in the
recruitment of Filipino workers, male and female, for overseas placement," 1 challenges the Constitutional validity of
Department Order No. 1, Series of 1988, of the Department of Labor and Employment, in the character of "GUIDELINES
GOVERNING THE TEMPORARY SUSPENSION OF DEPLOYMENT OF FILIPINO DOMESTIC AND HOUSEHOLD WORKERS," in
this petition for certiorari and prohibition. Specifically, the measure is assailed for "discrimination against males or
females;" 2 that it "does not apply to all Filipino workers but only to domestic helpers and females with similar
skills;" 3 and that it is violative of the right to travel. It is held likewise to be an invalid exercise of the lawmaking power,
police power being legislative, and not executive, in character.
In its supplement to the petition, PASEI invokes Section 3, of Article XIII, of the Constitution, providing for worker
participation "in policy and decision-making processes affecting their rights and benefits as may be provided by
law." 4 Department Order No. 1, it is contended, was passed in the absence of prior consultations. It is claimed, finally,
to be in violation of the Charter's non-impairment clause, in addition to the "great and irreparable injury" that PASEI
members face should the Order be further enforced.
On May 25, 1988, the Solicitor General, on behalf of the respondents Secretary of Labor and Administrator of the
Philippine Overseas Employment Administration, filed a Comment informing the Court that on March 8, 1988, the
respondent Labor Secretary lifted the deployment ban in the states of Iraq, Jordan, Qatar, Canada, Hongkong, United
States, Italy, Norway, Austria, and Switzerland. * In submitting the validity of the challenged "guidelines," the Solicitor
General invokes the police power of the Philippine State.
It is admitted that Department Order No. 1 is in the nature of a police power measure. The only question is whether or
not it is valid under the Constitution.
The concept of police power is well-established in this jurisdiction. It has been defined as the "state authority to enact
legislation that may interfere with personal liberty or property in order to promote the general welfare." 5 As defined, it
consists of (1) an imposition of restraint upon liberty or property, (2) in order to foster the common good. It is not
capable of an exact definition but has been, purposely, veiled in general terms to underscore its all-comprehensive
embrace.
"Its scope, ever-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." 6
It finds no specific Constitutional grant for the plain reason that it does not owe its origin to the Charter. Along with the
taxing power and eminent domain, it is inborn in the very fact of statehood and sovereignty. It is a fundamental
attribute of government that has enabled it to perform the most vital functions of governance. Marshall, to whom the
expression has been credited, 7 refers to it succinctly as the plenary power of the State "to govern its citizens." 8
"The police power of the State ... is a power coextensive with self- protection, and it is not inaptly termed the "law of
overwhelming necessity." It may be said to be that inherent and plenary power in the State which enables it to prohibit
all things hurtful to the comfort, safety, and welfare of society." 9
It constitutes an implied limitation on the Bill of Rights. According to Fernando, it is "rooted in the conception that men
in organizing the state and imposing upon its government limitations to safeguard constitutional rights did not intend
thereby to enable an individual citizen or a group of citizens to obstruct unreasonably the enactment of such salutary
measures calculated to ensure communal peace, safety, good order, and welfare." 10 Significantly, the Bill of Rights
itself does not purport to be an absolute guaranty of individual rights and liberties "Even liberty itself, the greatest of all
rights, is not unrestricted license to act according to one's will." 11 It is subject to the far more overriding demands and
requirements of the greater number.
Notwithstanding its extensive sweep, police power is not without its own limitations. For all its awesome consequences,
it may not be exercised arbitrarily or unreasonably. Otherwise, and in that event, it defeats the purpose for which it is
exercised, that is, to advance the public good. Thus, when the power is used to further private interests at the expense
of the citizenry, there is a clear misuse of the power. 12
In the light of the foregoing, the petition must be dismissed.
As a general rule, official acts enjoy a presumed vahdity. 13 In the absence of clear and convincing evidence to the
contrary, the presumption logically stands.
The petitioner has shown no satisfactory reason why the contested measure should be nullified. There is no question
that Department Order No. 1 applies only to "female contract workers," 14 but it does not thereby make an undue
discrimination between the sexes. It is well-settled that "equality before the law" under the Constitution 15does not
import a perfect Identity of rights among all men and women. It admits of classifications, provided that (1) such
classifications rest on substantial distinctions; (2) they are germane to the purposes of the law; (3) they are not confined
to existing conditions; and (4) they apply equally to all members of the same class. 16
The Court is satisfied that the classification made-the preference for female workers — rests on substantial distinctions.
As a matter of judicial notice, the Court is well aware of the unhappy plight that has befallen our female labor force
abroad, especially domestic servants, amid exploitative working conditions marked by, in not a few cases, physical and
personal abuse. The sordid tales of maltreatment suffered by migrant Filipina workers, even rape and various forms of
torture, confirmed by testimonies of returning workers, are compelling motives for urgent Government action. As
precisely the caretaker of Constitutional rights, the Court is called upon to protect victims of exploitation. In fulfilling
that duty, the Court sustains the Government's efforts.
The same, however, cannot be said of our male workers. In the first place, there is no evidence that, except perhaps for
isolated instances, our men abroad have been afflicted with an Identical predicament. The petitioner has proffered no
argument that the Government should act similarly with respect to male workers. The Court, of course, is not impressing
some male chauvinistic notion that men are superior to women. What the Court is saying is that it was largely a matter
of evidence (that women domestic workers are being ill-treated abroad in massive instances) and not upon some
fanciful or arbitrary yardstick that the Government acted in this case. It is evidence capable indeed of unquestionable
demonstration and evidence this Court accepts. The Court cannot, however, say the same thing as far as men are
concerned. There is simply no evidence to justify such an inference. Suffice it to state, then, that insofar as classifications
are concerned, this Court is content that distinctions are borne by the evidence. Discrimination in this case is justified.
As we have furthermore indicated, executive determinations are generally final on the Court. Under a republican
regime, it is the executive branch that enforces policy. For their part, the courts decide, in the proper cases, whether
that policy, or the manner by which it is implemented, agrees with the Constitution or the laws, but it is not for them to
question its wisdom. As a co-equal body, the judiciary has great respect for determinations of the Chief Executive or his
subalterns, especially when the legislature itself has specifically given them enough room on how the law should be
effectively enforced. In the case at bar, there is no gainsaying the fact, and the Court will deal with this at greater length
shortly, that Department Order No. 1 implements the rule-making powers granted by the Labor Code. But what should
be noted is the fact that in spite of such a fiction of finality, the Court is on its own persuaded that prevailing conditions
indeed call for a deployment ban.
There is likewise no doubt that such a classification is germane to the purpose behind the measure. Unquestionably, it is
the avowed objective of Department Order No. 1 to "enhance the protection for Filipino female overseas
workers" 17 this Court has no quarrel that in the midst of the terrible mistreatment Filipina workers have suffered
abroad, a ban on deployment will be for their own good and welfare.
The Order does not narrowly apply to existing conditions. Rather, it is intended to apply indefinitely so long as those
conditions exist. This is clear from the Order itself ("Pending review of the administrative and legal measures, in the
Philippines and in the host countries . . ."18), meaning to say that should the authorities arrive at a means impressed
with a greater degree of permanency, the ban shall be lifted. As a stop-gap measure, it is possessed of a necessary
malleability, depending on the circumstances of each case. Accordingly, it provides:
9. LIFTING OF SUSPENSION. — The Secretary of Labor and Employment (DOLE) may, upon recommendation of the
Philippine Overseas Employment Administration (POEA), lift the suspension in countries where there are:
1. Bilateral agreements or understanding with the Philippines, and/or,
2. Existing mechanisms providing for sufficient safeguards to ensure the welfare and protection of Filipino workers. 19
The Court finds, finally, the impugned guidelines to be applicable to all female domestic overseas workers. That it does
not apply to "all Filipina workers" 20 is not an argument for unconstitutionality. Had the ban been given universal
applicability, then it would have been unreasonable and arbitrary. For obvious reasons, not all of them are similarly
circumstanced. What the Constitution prohibits is the singling out of a select person or group of persons within an
existing class, to the prejudice of such a person or group or resulting in an unfair advantage to another person or group
of persons. To apply the ban, say exclusively to workers deployed by A, but not to those recruited by B, would obviously
clash with the equal protection clause of the Charter. It would be a classic case of what Chase refers to as a law that
"takes property from A and gives it to B." 21 It would be an unlawful invasion of property rights and freedom of contract
and needless to state, an invalid act. 22 (Fernando says: "Where the classification is based on such distinctions that
make a real difference as infancy, sex, and stage of civilization of minority groups, the better rule, it would seem, is to
recognize its validity only if the young, the women, and the cultural minorities are singled out for favorable treatment.
There would be an element of unreasonableness if on the contrary their status that calls for the law ministering to their
needs is made the basis of discriminatory legislation against them. If such be the case, it would be difficult to refute the
assertion of denial of equal protection." 23 In the case at bar, the assailed Order clearly accords protection to certain
women workers, and not the contrary.)
It is incorrect to say that Department Order No. 1 prescribes a total ban on overseas deployment. From scattered
provisions of the Order, it is evident that such a total ban has hot been contemplated. We quote:
5. AUTHORIZED DEPLOYMENT-The deployment of domestic helpers and workers of similar skills defined herein to the
following [sic] are authorized under these guidelines and are exempted from the suspension.
5.1 Hirings by immediate members of the family of Heads of State and Government;
5.2 Hirings by Minister, Deputy Minister and the other senior government officials; and
5.3 Hirings by senior officials of the diplomatic corps and duly accredited international organizations.
5.4 Hirings by employers in countries with whom the Philippines have [sic] bilateral labor agreements or understanding.
xxx xxx xxx
7. VACATIONING DOMESTIC HELPERS AND WORKERS OF SIMILAR SKILLS--Vacationing domestic helpers and/or workers
of similar skills shall be allowed to process with the POEA and leave for worksite only if they are returning to the same
employer to finish an existing or partially served employment contract. Those workers returning to worksite to serve a
new employer shall be covered by the suspension and the provision of these guidelines.
xxx xxx xxx
9. LIFTING OF SUSPENSION-The Secretary of Labor and Employment (DOLE) may, upon recommendation of the
Philippine Overseas Employment Administration (POEA), lift the suspension in countries where there are:
1. Bilateral agreements or understanding with the Philippines, and/or,
2. Existing mechanisms providing for sufficient safeguards to ensure the welfare and protection of Filipino workers. 24
xxx xxx xxx
The consequence the deployment ban has on the right to travel does not impair the right. The right to travel is subject,
among other things, to the requirements of "public safety," "as may be provided by law." 25 Department Order No. 1 is
a valid implementation of the Labor Code, in particular, its basic policy to "afford protection to labor," 26 pursuant to
the respondent Department of Labor's rule-making authority vested in it by the Labor Code. 27 The petitioner assumes
that it is unreasonable simply because of its impact on the right to travel, but as we have stated, the right itself is not
absolute. The disputed Order is a valid qualification thereto.
Neither is there merit in the contention that Department Order No. 1 constitutes an invalid exercise of legislative power.
It is true that police power is the domain of the legislature, but it does not mean that such an authority may not be
lawfully delegated. As we have mentioned, the Labor Code itself vests the Department of Labor and Employment with
rulemaking powers in the enforcement whereof. 28
The petitioners's reliance on the Constitutional guaranty of worker participation "in policy and decision-making
processes affecting their rights and benefits" 29 is not well-taken. The right granted by this provision, again, must submit
to the demands and necessities of the State's power of regulation.
The Constitution declares that:
Sec. 3. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full
employment and equality of employment opportunities for all. 30
"Protection to labor" does not signify the promotion of employment alone. What concerns the Constitution more
paramountly is that such an employment be above all, decent, just, and humane. It is bad enough that the country has
to send its sons and daughters to strange lands because it cannot satisfy their employment needs at home. Under these
circumstances, the Government is duty-bound to insure that our toiling expatriates have adequate protection,
personally and economically, while away from home. In this case, the Government has evidence, an evidence the
petitioner cannot seriously dispute, of the lack or inadequacy of such protection, and as part of its duty, it has precisely
ordered an indefinite ban on deployment.
The Court finds furthermore that the Government has not indiscriminately made use of its authority. It is not contested
that it has in fact removed the prohibition with respect to certain countries as manifested by the Solicitor General.
The non-impairment clause of the Constitution, invoked by the petitioner, must yield to the loftier purposes targetted by
the Government. 31 Freedom of contract and enterprise, like all other freedoms, is not free from restrictions, more so in
this jurisdiction, where laissez faire has never been fully accepted as a controlling economic way of life.
This Court understands the grave implications the questioned Order has on the business of recruitment. The concern of
the Government, however, is not necessarily to maintain profits of business firms. In the ordinary sequence of events, it
is profits that suffer as a result of Government regulation. The interest of the State is to provide a decent living to its
citizens. The Government has convinced the Court in this case that this is its intent. We do not find the impugned Order
to be tainted with a grave abuse of discretion to warrant the extraordinary relief prayed for.
WHEREFORE, the petition is DISMISSED. No costs.
SO ORDERED.
Yap, C.J., Fernan, Narvasa, Melencio-Herrera, Cruz, Paras, Feliciano, Gancayco, Padilla, Bidin, Cortes and Griño-Aquino,
JJ., concur.
Gutierrez, Jr. and Medialdea, JJ., are on leave.

[G.R. No. 127820. July 20, 1998]


MUNICIPALITY OF PARAAQUE, petitioner, vs. V.M. REALTY CORPORATION, respondent.
DECISION
PANGANIBAN, J.:
A local government unit (LGU), like the Municipality of Paraaque, cannot authorize an expropriation of private property
through a mere resolution of its lawmaking body. The Local Government Code expressly and clearly requires an
ordinance or a local law for the purpose. A resolution that merely expresses the sentiment or opinion of the Municipal
Council will not suffice. On the other hand, the principle of res judicata does not bar subsequent proceedings for the
expropriation of the same property when all the legal requirements for its valid exercise are complied with.
Statement of the Case
These principles are applied by this Court in resolving this petition for review on certiorari of the July 22, 1996
Decision[1] of the Court of Appeals[2] in CA GR CV No. 48048, which affirmed in toto[3] the Regional Trial Courts August
9, 1994 Resolution.[4] The trial court dismissed the expropriation suit as follows:
The right of the plaintiff to exercise the power of eminent domain is not disputed. However, such right may be exercised
only pursuant to an Ordinance (Sec. 19, R.A. No. 7160). In the instant case, there is no such ordinance passed by the
Municipal Council of Paraaque enabling the Municipality, thru its Chief Executive, to exercise the power of eminent
domain. The complaint, therefore, states no cause of action.
Assuming that plaintiff has a cause of action, the same is barred by a prior judgment. On September 29, 1987, the
plaintiff filed a complaint for expropriation involving the same parcels of land which was docketed as Civil Case No.
17939 of this Court (page 26, record). Said case was dismissed with prejudice on May 18, 1988 (page 39, record). The
order of dismissal was not appealed, hence, the same became final. The plaintiff can not be allowed to pursue the
present action without violating the principle of [r]es [j]udicata. While defendant in Civil Case No. 17939 was Limpan
Investment Corporation, the doctrine of res judicata still applies because the judgment in said case (C.C. No. 17939) is
conclusive between the parties and their successors-in-interest (Vda. de Buncio vs. Estate of the late Anita de Leon). The
herein defendant is the successor-in-interest of Limpan Investment Corporation as shown by the Deed of Assignment
Exchange executed on June 13, 1990.
WHEREFORE, defendants motion for reconsideration is hereby granted. The order dated February 4, 1994 is vacated and
set aside.
This case is hereby dismissed. No pronouncement as to costs.
SO ORDERED.[5]
Factual Antecedents
Pursuant to Sangguniang Bayan Resolution No. 93-95, Series of 1993,[6] the Municipality of Paraaque filed on
September 20, 1993, a Complaint for expropriation[7] against Private Respondent V.M. Realty Corporation over two
parcels of land (Lots 2-A-2 and 2-B-1 of Subdivision Plan Psd-17917), with a combined area of about 10,000 square
meters, located at Wakas, San Dionisio, Paraaque, Metro Manila, and covered by Torrens Certificate of Title No.
48700. Allegedly, the complaint was filed for the purpose of alleviating the living conditions of the underprivileged by
providing homes for the homeless through a socialized housing project.[8] Parenthetically, it was also for this stated
purpose that petitioner, pursuant to its Sangguniang Bayan Resolution No. 577, Series of 1991,[9] previously made an
offer to enter into a negotiated sale of the property with private respondent, which the latter did not accept.[10]
Finding the Complaint sufficient in form and substance, the Regional Trial Court of Makati, Branch 134, issued an Order
dated January 10, 1994,[11] giving it due course.Acting on petitioners motion, said court issued an Order dated February
4, 1994,[12] authorizing petitioner to take possession of the subject property upon deposit with its clerk of court of an
amount equivalent to 15 percent of its fair market value based on its current tax declaration.
On February 21, 1994, private respondent filed its Answer containing affirmative defenses and a
counterclaim,[13] alleging in the main that (a) the complaint failed to state a cause of action because it was filed
pursuant to a resolution and not to an ordinance as required by RA 7160 (the Local Government Code); and (b) the
cause of action, if any, was barred by a prior judgment or res judicata. On private respondents motion, its Answer was
treated as a motion to dismiss.[14] On March 24, 1994,[15] petitioner filed its opposition, stressing that the trial courts
Order dated February 4, 1994 was in accord with Section 19 of RA 7160, and that the principle of res judicata was not
applicable.
Thereafter, the trial court issued its August 9, 1994 Resolution[16] nullifying its February 4, 1994 Order and dismissing
the case. Petitioners motions for reconsideration and transfer of venue were denied by the trial court in a Resolution
dated December 2, 1994.[17] Petitioner then appealed to Respondent Court, raising the following issues:
1. Whether or not the Resolution of the Paraaque Municipal Council No. 93-95, Series of 1993 is a substantial
compliance of the statutory requirement of Section 19, R.A. 7180 [sic] in the exercise of the power of eminent domain
by the plaintiff-appellant.
2. Whether or not the complaint in this case states no cause of action.
3. Whether or not the strict adherence to the literal observance to the rule of procedure resulted in technicality standing
in the way of substantial justice.
4. Whether or not the principle of res judicata is applicable to the present case.[18]
As previously mentioned, the Court of Appeals affirmed in toto the trial courts Decision. Respondent Court, in its
assailed Resolution promulgated on January 8, 1997,[19]denied petitioners Motion for Reconsideration for lack of merit.
Hence, this appeal.[20]
The Issues
Before this Court, petitioner posits two issues, viz.:
1. A resolution duly approved by the municipal council has the same force and effect of an ordinance and will not
deprive an expropriation case of a valid cause of action.
2. The principle of res judicata as a ground for dismissal of case is not applicable when public interest is primarily
involved.[21]
The Courts Ruling
The petition is not meritorious.
First Issue:
Resolution Different from an Ordinance
Petitioner contends that a resolution approved by the municipal council for the purpose of initiating an expropriation
case substantially complies with the requirements of the law[22] because the terms ordinance and resolution are
synonymous for the purpose of bestowing authority [on] the local government unit through its chief executive to initiate
the expropriation proceedings in court in the exercise of the power of eminent domain.[23] Petitioner seeks to bolster
this contention by citing Article 36, Rule VI of the Rules and Regulations Implementing the Local Government Code,
which provides: If the LGU fails to acquire a private property for public use, purpose, or welfare through purchase, the
LGU may expropriate said property through a resolution of the Sanggunian authorizing its chief executive to initiate
expropriation proceedings.[24] (Italics supplied.)
The Court disagrees. The power of eminent domain is lodged in the legislative branch of government, which may
delegate the exercise thereof to LGUs, other public entities and public utilities.[25] An LGU may therefore exercise the
power to expropriate private property only when authorized by Congress and subject to the latters control and
restraints, imposed through the law conferring the power or in other legislations.[26] In this case, Section 19 of RA 7160,
which delegates to LGUs the power of eminent domain, also lays down the parameters for its exercise. It provides as
follows:
Section 19. Eminent Domain. A local government unit may, through its chief executive and acting pursuant to
an ordinance, exercise the power of eminent domain for public use, or purpose, or welfare for the benefit of the poor
and the landless, upon payment of just compensation, pursuant to the provisions of the Constitution and pertinent
laws: Provided, however, That the power of eminent domain may not be exercised unless a valid and definite offer has
been previously made to the owner, and such offer was not accepted: Provided, further, That the local government unit
may immediately take possession of the property upon the filing of the expropriation proceedings and upon making a
deposit with the proper court of at least fifteen percent (15%) of the fair market value of the property based on the
current tax declaration of the property to be expropriated: Provided, finally, That, the amount to be paid for the
expropriated property shall be determined by the proper court, based on the fair market value at the time of the taking
of the property. (Emphasis supplied)
Thus, the following essential requisites must concur before an LGU can exercise the power of eminent domain:
1. An ordinance is enacted by the local legislative council authorizing the local chief executive, in behalf of the LGU, to
exercise the power of eminent domain or pursue expropriation proceedings over a particular private property.
2. The power of eminent domain is exercised for public use, purpose or welfare, or for the benefit of the poor and the
landless.
3. There is payment of just compensation, as required under Section 9, Article III of the Constitution, and other pertinent
laws.
4. A valid and definite offer has been previously made to the owner of the property sought to be expropriated, but said
offer was not accepted.[27]
In the case at bar, the local chief executive sought to exercise the power of eminent domain pursuant to a resolution of
the municipal council. Thus, there was no compliance with the first requisite that the mayor be authorized through an
ordinance. Petitioner cites Camarines Sur vs. Court of Appeals[28] to show that a resolution may suffice to support the
exercise of eminent domain by an LGU.[29] This case, however, is not in point because the applicable law at that time
was BP 337,[30] the previous Local Government Code, which had provided that a mere resolution would enable an LGU
to exercise eminent domain. In contrast, RA 7160,[31] the present Local Government Code which was already in force
when the Complaint for expropriation was filed, explicitly required an ordinance for this purpose.
We are not convinced by petitioners insistence that the terms resolution and ordinance are synonymous. A municipal
ordinance is different from a resolution. An ordinance is a law, but a resolution is merely a declaration of the sentiment
or opinion of a lawmaking body on a specific matter.[32] An ordinance possesses a general and permanent character,
but a resolution is temporary in nature. Additionally, the two are enacted differently -- a third reading is necessary for an
ordinance, but not for a resolution, unless decided otherwise by a majority of all the Sanggunian members.[33]
If Congress intended to allow LGUs to exercise eminent domain through a mere resolution, it would have simply
adopted the language of the previous Local Government Code. But Congress did not. In a clear divergence from the
previous Local Government Code, Section 19 of RA 7160 categorically requires that the local chief executive act pursuant
to an ordinance. Indeed, [l]egislative intent is determined principally from the language of a statute. Where the language
of a statute is clear and unambiguous, the law is applied according to its express terms, and interpretation would be
resorted to only where a literal interpretation would be either impossible or absurd or would lead to an injustice.[34] In
the instant case, there is no reason to depart from this rule, since the law requiring an ordinance is not at all impossible,
absurd, or unjust.
Moreover, the power of eminent domain necessarily involves a derogation of a fundamental or private right of the
people.[35] Accordingly, the manifest change in the legislative language -- from resolution under BP 337 to ordinance
under RA 7160 -- demands a strict construction. No species of property is held by individuals with greater tenacity, and is
guarded by the Constitution and laws more sedulously, than the right to the freehold of inhabitants. When the
legislature interferes with that right and, for greater public purposes, appropriates the land of an individual without his
consent, the plain meaning of the law should not be enlarged by doubtful interpretation.[36]
Petitioner relies on Article 36, Rule VI of the Implementing Rules, which requires only a resolution to authorize an LGU to
exercise eminent domain. This is clearly misplaced, because Section 19 of RA 7160, the law itself, surely prevails over
said rule which merely seeks to implement it.[37] It is axiomatic that the clear letter of the law is controlling and cannot
be amended by a mere administrative rule issued for its implementation. Besides, what the discrepancy seems to
indicate is a mere oversight in the wording of the implementing rules, since Article 32, Rule VI thereof, also requires
that, in exercising the power of eminent domain, the chief executive of the LGU must act pursuant to an ordinance.
In this ruling, the Court does not diminish the policy embodied in Section 2, Article X of the Constitution, which provides
that territorial and political subdivisions shall enjoy local autonomy. It merely upholds the law as worded in RA 7160. We
stress that an LGU is created by law and all its powers and rights are sourced therefrom. It has therefore no power to
amend or act beyond the authority given and the limitations imposed on it by law. Strictly speaking, the power of
eminent domain delegated to an LGU is in reality not eminent but inferior domain, since it must conform to the limits
imposed by the delegation, and thus partakes only of a share in eminent domain.[38] Indeed, the national legislature is
still the principal of the local government units, which cannot defy its will or modify or violate it.[39]
Complaint Does Not State a Cause of Action
In its Brief filed before Respondent Court, petitioner argues that its Sanguniang Bayan passed an ordinance on October
11, 1994 which reiterated its Resolution No. 93-35, Series of 1993, and ratified all the acts of its mayor regarding the
subject expropriation.[40]
This argument is bereft of merit. In the first place, petitioner merely alleged the existence of such an ordinance, but it
did not present any certified true copy thereof. In the second place, petitioner did not raise this point before this
Court. In fact, it was mentioned by private respondent, and only in passing.[41] In any event, this allegation does not
cure the inherent defect of petitioners Complaint for expropriation filed on September 23, 1993. It is hornbook doctrine
that:
x x x in a motion to dismiss based on the ground that the complaint fails to state a cause of action, the question
submitted before the court for determination is the sufficiency of the allegations in the complaint itself. Whether those
allegations are true or not is beside the point, for their truth is hypothetically admitted by the motion. The issue rather
is: admitting them to be true, may the court render a valid judgment in accordance with the prayer of the
complaint?[42]
The fact that there is no cause of action is evident from the face of the Complaint for expropriation which was based on
a mere resolution. The absence of an ordinance authorizing the same is equivalent to lack of cause of
action. Consequently, the Court of Appeals committed no reversible error in affirming the trial courts Decision which
dismissed the expropriation suit.
Second Issue:
Eminent Domain Not Barred by Res Judicata
As correctly found by the Court of Appeals[43] and the trial court,[44] all the requisites for the application of res
judicata are present in this case. There is a previous final judgment on the merits in a prior expropriation case involving
identical interests, subject matter and cause of action, which has been rendered by a court having jurisdiction over it.
Be that as it may, the Court holds that the principle of res judicata, which finds application in generally all cases and
proceedings,[45] cannot bar the right of the State or its agent to expropriate private property. The very nature of
eminent domain, as an inherent power of the State, dictates that the right to exercise the power be absolute and
unfettered even by a prior judgment or res judicata. The scope of eminent domain is plenary and, like police power, can
reach every form of property which the State might need for public use.[46] All separate interests of individuals in
property are held of the government under this tacit agreement or implied reservation. Notwithstanding the grant to
individuals, the eminent domain, the highest and most exact idea of property, remains in the government, or in the
aggregate body of the people in their sovereign capacity; and they have the right to resume the possession of the
property whenever the public interest requires it.[47] Thus, the State or its authorized agent cannot be forever barred
from exercising said right by reason alone of previous non-compliance with any legal requirement.
While the principle of res judicata does not denigrate the right of the State to exercise eminent domain, it does apply to
specific issues decided in a previous case. For example, a final judgment dismissing an expropriation suit on the ground
that there was no prior offer precludes another suit raising the same issue; it cannot, however, bar the State or its agent
from thereafter complying with this requirement, as prescribed by law, and subsequently exercising its power of
eminent domain over the same property.[48] By the same token, our ruling that petitioner cannot exercise its delegated
power of eminent domain through a mere resolution will not bar it from reinstituting similar proceedings, once the said
legal requirement and, for that matter, all others are properly complied with. Parenthetically and by parity of reasoning,
the same is also true of the principle of law of the case. In Republic vs De Knecht,[49] the Court ruled that the power of
the State or its agent to exercise eminent domain is not diminished by the mere fact that a prior final judgment over the
property to be expropriated has become the law of the case as to the parties. The State or its authorized agent may still
subsequently exercise its right to expropriate the same property, once all legal requirements are complied with. To rule
otherwise will not only improperly diminish the power of eminent domain, but also clearly defeat social justice.
WHEREFORE, the petition is hereby DENIED without prejudice to petitioners proper exercise of its power of eminent
domain over subject property. Costs against petitioner.
SO ORDERED.
Davide, Jr., (Chairman), Bellosillo, Vitug, and Quisumbing, JJ., concur.
[G.R. No. 129093. August 30, 2001]
HON. JOSE D. LINA, JR., SANGGUNIANG PANLALAWIGAN OF LAGUNA, and HON. CALIXTO CATAQUIZ, petitioners, vs.
HON. FRANCISCO DIZON PAO and TONY CALVENTO, respondents.
DECISION
QUISUMBING, J.:
For our resolution is a petition for review on certiorari seeking the reversal of the decision[1] dated February 10, 1997 of
the Regional Trial Court of San Pedro, Laguna, Branch 93, enjoining petitioners from implementing or
enforcing Kapasiyahan Bilang 508, Taon 1995, of the Sangguniang Panlalawigan of Laguna and its subsequent
Order[2] dated April 21, 1997 denying petitioners motion for reconsideration.
On December 29, 1995, respondent Tony Calvento was appointed agent by the Philippine Charity Sweepstakes Office
(PCSO) to install Terminal OM 20 for the operation of lotto. He asked Mayor Calixto Cataquiz, Mayor of San Pedro,
Laguna, for a mayors permit to open the lotto outlet. This was denied by Mayor Cataquiz in a letter dated February 19,
1996. The ground for said denial was an ordinance passed by the Sangguniang Panlalawigan of Laguna
entitled Kapasiyahan Blg. 508, T. 1995 which was issued on September 18, 1995. The ordinance reads:
ISANG KAPASIYAHAN TINUTUTULAN ANG MGA ILLEGAL GAMBLING LALO NA ANG LOTTO SA LALAWIGAN NG LAGUNA
SAPAGKAT, ang sugal dito sa lalawigan ng Laguna ay talamak na;
SAPAGKAT, ang sugal ay nagdudulot ng masasamang impluwensiya lalot higit sa mga kabataan;
KUNG KAYAT DAHIL DITO, at sa mungkahi nina Kgg. Kgd. Juan M. Unico at Kgg. Kgd. Gat-Ala A. Alatiit, pinangalawahan ni
Kgg. Kgd. Meliton C. Larano at buong pagkakaisang sinangayunan ng lahat ng dumalo sa pulong;
IPINASIYA, na tutulan gaya ng dito ay mahigpit na TINUTUTULAN ang ano mang uri ng sugal dito sa lalawigan ng Laguna
lalot higit ang Lotto;
IPINASIYA PA RIN na hilingin tulad ng dito ay hinihiling sa Panlalawigang pinuno ng Philippine National Police (PNP) Col.
[illegible] na mahigpit na pag-ibayuhin ang pagsugpo sa lahat ng uri ng illegal na sugal sa buong lalawigan ng Laguna lalo
na ang Jueteng.[3]
As a result of this resolution of denial, respondent Calvento filed a complaint for declaratory relief with prayer for
preliminary injunction and temporary restraining order. In the said complaint, respondent Calvento asked the Regional
Trial Court of San Pedro Laguna, Branch 93, for the following reliefs: (1) a preliminary injunction or temporary restraining
order, ordering the defendants to refrain from implementing or enforcing Kapasiyahan Blg. 508, T. 1995; (2) an order
requiring Hon. Municipal Mayor Calixto R. Cataquiz to issue a business permit for the operation of a lotto outlet; and (3)
an order annulling or declaring as invalid Kapasiyahan Blg. 508, T. 1995.
On February 10, 1997, the respondent judge, Francisco Dizon Pao, promulgated his decision enjoining the petitioners
from implementing or enforcing resolution or Kapasiyahan Blg. 508, T. 1995. The dispositive portion of said decision
reads:
WHEREFORE, premises considered, defendants, their agents and representatives are hereby enjoined from
implementing or enforcing resolution or kapasiyahan blg. 508, T. 1995 of the Sangguniang Panlalawigan ng Laguna
prohibiting the operation of the lotto in the province of Laguna.
SO ORDERED.[4]
Petitioners filed a motion for reconsideration which was subsequently denied in an Order dated April 21, 1997, which
reads:
Acting on the Motion for Reconsideration filed by defendants Jose D. Lina, Jr. and the Sangguniang Panlalawigan of
Laguna, thru counsel, with the opposition filed by plaintiffs counsel and the comment thereto filed by counsel for the
defendants which were duly noted, the Court hereby denies the motion for lack of merit.
SO ORDERED.[5]
On May 23, 1997, petitioners filed this petition alleging that the following errors were committed by the respondent trial
court:
I
THE TRIAL COURT ERRED IN ENJOINING THE PETITIONERS FROM IMPLEMENTING KAPASIYAHAN BLG. 508, T. 1995 OF
THE SANGGUNIANG PANLALAWIGAN OF LAGUNA PROHIBITING THE OPERATION OF THE LOTTO IN THE PROVINCE OF
LAGUNA.
II
THE TRIAL COURT FAILED TO APPRECIATE THE ARGUMENT POSITED BY THE PETITIONERS THAT BEFORE ANY
GOVERNMENT PROJECT OR PROGRAM MAY BE IMPLEMENTED BY THE NATIONAL AGENCIES OR OFFICES, PRIOR
CONSULTATION AND APPROVAL BY THE LOCAL GOVERNMENT UNITS CONCERNED AND OTHER CONCERNED SECTORS IS
REQUIRED.
Petitioners contend that the assailed resolution is a valid policy declaration of the Provincial Government of Laguna of its
vehement objection to the operation of lotto and all forms of gambling. It is likewise a valid exercise of the provincial
governments police power under the General Welfare Clause of Republic Act 7160, otherwise known as the Local
Government Code of 1991.[6] They also maintain that respondents lotto operation is illegal because no prior
consultations and approval by the local government were sought before it was implemented contrary to the express
provisions of Sections 2 (c) and 27 of R.A. 7160.[7]
For his part, respondent Calvento argues that the questioned resolution is, in effect, a curtailment of the power of the
state since in this case the national legislature itself had already declared lotto as legal and permitted its operations
around the country.[8] As for the allegation that no prior consultations and approval were sought from the sangguniang
panlalawigan of Laguna, respondent Calvento contends this is not mandatory since such a requirement is merely stated
as a declaration of policy and not a self-executing provision of the Local Government Code of 1991.[9] He also states that
his operation of the lotto system is legal because of the authority given to him by the PCSO, which in turn had been
granted a franchise to operate the lotto by Congress.[10]
The Office of the Solicitor General (OSG), for the State, contends that the Provincial Government of Laguna has no
power to prohibit a form of gambling which has been authorized by the national government.[11] He argues that this is
based on the principle that ordinances should not contravene statutes as municipal governments are merely agents of
the national government. The local councils exercise only delegated legislative powers which have been conferred on
them by Congress. This being the case, these councils, as delegates, cannot be superior to the principal or exercise
powers higher than those of the latter. The OSG also adds that the question of whether gambling should be permitted is
for Congress to determine, taking into account national and local interests. Since Congress has allowed the PCSO to
operate lotteries which PCSO seeks to conduct in Laguna, pursuant to its legislative grant of authority, the
provinces Sangguniang Panlalawigan cannot nullify the exercise of said authority by preventing something already
allowed by Congress.
The issues to be resolved now are the following: (1) whether Kapasiyahan Blg. 508, T. 1995 of the Sangguniang
Panlalawigan of Laguna and the denial of a mayors permit based thereon are valid; and (2) whether prior consultations
and approval by the concerned Sanggunian are needed before a lotto system can be operated in a given local
government unit.
The entire controversy stemmed from the refusal of Mayor Cataquiz to issue a mayors permit for the operation of a
lotto outlet in favor of private respondent. According to the mayor, he based his decision on an existing ordinance
prohibiting the operation of lotto in the province of Laguna. The ordinance, however, merely states the objection of the
council to the said game. It is but a mere policy statement on the part of the local council, which is not self-
executing. Nor could it serve as a valid ground to prohibit the operation of the lotto system in the province of
Laguna. Even petitioners admit as much when they stated in their petition that:
5.7. The terms of the Resolution and the validity thereof are express and clear. The Resolution is a policy declaration of
the Provincial Government of Laguna of its vehement opposition and/or objection to the operation of and/or all forms
of gambling including the Lotto operation in the Province of Laguna.[12]
As a policy statement expressing the local governments objection to the lotto, such resolution is valid. This is part of the
local governments autonomy to air its views which may be contrary to that of the national governments. However, this
freedom to exercise contrary views does not mean that local governments may actually enact ordinances that go against
laws duly enacted by Congress. Given this premise, the assailed resolution in this case could not and should not be
interpreted as a measure or ordinance prohibiting the operation of lotto.
The game of lotto is a game of chance duly authorized by the national government through an Act of Congress. Republic
Act 1169, as amended by Batas Pambansa Blg. 42, is the law which grants a franchise to the PCSO and allows it to
operate the lotteries. The pertinent provision reads:
Section 1. The Philippine Charity Sweepstakes Office.- The Philippine Charity Sweepstakes Office, hereinafter designated
the Office, shall be the principal government agency for raising and providing for funds for health programs, medical
assistance and services and charities of national character, and as such shall have the general powers conferred in
section thirteen of Act Numbered One thousand four hundred fifty-nine, as amended, and shall have the authority:
A. To hold and conduct charity sweepstakes races, lotteries, and other similar activities, in such frequency and manner,
as shall be determined, and subject to such rules and regulations as shall be promulgated by the Board of Directors.
This statute remains valid today. While lotto is clearly a game of chance, the national government deems it wise and
proper to permit it. Hence, the Sangguniang Panlalawigan of Laguna, a local government unit, cannot issue a resolution
or an ordinance that would seek to prohibit permits. Stated otherwise, what the national legislature expressly allows by
law, such as lotto, a provincial board may not disallow by ordinance or resolution.
In our system of government, the power of local government units to legislate and enact ordinances and resolutions is
merely a delegated power coming from Congress. As held in Tatel vs. Virac,[13] ordinances should not contravene an
existing statute enacted by Congress. The reasons for this is obvious, as elucidated in Magtajas v. Pryce Properties
Corp.[14]
Municipal governments are only agents of the national government. Local councils exercise only delegated legislative
powers conferred upon them by Congress as the national lawmaking body.The delegate cannot be superior to the
principal or exercise powers higher than those of the latter. It is a heresy to suggest that the local government units can
undo the acts of Congress, from which they have derived their power in the first place, and negate by mere ordinance
the mandate of the statute.
Municipal corporations owe their origin to, and derive their powers and rights wholly from the legislature. It breathes
into them the breath of life, without which they cannot exist. As it creates, so it may destroy. As it may destroy, it may
abridge and control. Unless there is some constitutional limitation on the right, the legislature might, by a single act, and
if we can suppose it capable of so great a folly and so great a wrong, sweep from existence all of the municipal
corporations in the state, and the corporation could not prevent it. We know of no limitation on the right so far as the
corporation themselves are concerned. They are, so to phrase it, the mere tenants at will of the legislature (citing
Clinton vs. Ceder Rapids, etc. Railroad Co., 24 Iowa 455).
Nothing in the present constitutional provision enhancing local autonomy dictates a different conclusion.
The basic relationship between the national legislature and the local government units has not been enfeebled by the
new provisions in the Constitution strengthening the policy of local autonomy. Without meaning to detract from that
policy, we here confirm that Congress retains control of the local government units although in significantly reduced
degree now than under our previous Constitutions. The power to create still includes the power to destroy. The power
to grant still includes the power to withhold or recall. True, there are certain notable innovations in the Constitution, like
the direct conferment on the local government units of the power to tax (citing Art. X, Sec. 5, Constitution), which
cannot now be withdrawn by mere statute. By and large, however, the national legislature is still the principal of the
local government units, which cannot defy its will or modify or violate it.[15]
Ours is still a unitary form of government, not a federal state. Being so, any form of autonomy granted to local
governments will necessarily be limited and confined within the extent allowed by the central authority. Besides, the
principle of local autonomy under the 1987 Constitution simply means decentralization. It does not make local
governments sovereign within the state or an imperium in imperio.[16]
To conclude our resolution of the first issue, respondent mayor of San Pedro, cannot avail of Kapasiyahan Bilang 508,
Taon 1995, of the Provincial Board of Laguna as justification to prohibit lotto in his municipality. For said resolution is
nothing but an expression of the local legislative unit concerned. The Boards enactment, like spring water, could not rise
above its source of power, the national legislature.
As for the second issue, we hold that petitioners erred in declaring that Sections 2 (c) and 27 of Republic Act 7160,
otherwise known as the Local Government Code of 1991, apply mandatorily in the setting up of lotto outlets around the
country. These provisions state:
Section 2. Declaration of Policy. x x x
(c) It is likewise the policy of the State to require all national agencies and offices to conduct periodic consultations with
appropriate local government units, non-governmental and peoples organizations, and other concerned sectors of the
community before any project or program is implemented in their respective jurisdictions.
Section 27. Prior Consultations Required. No project or program shall be implemented by government authorities unless
the consultations mentioned in Section 2 (c) and 26 hereof are complied with, and prior approval of the sanggunian
concerned is obtained; Provided, that occupants in areas where such projects are to be implemented shall not be
evicted unless appropriate relocation sites have been provided, in accordance with the provisions of the Constitution.
From a careful reading of said provisions, we find that these apply only to national programs and/or projects which are
to be implemented in a particular local community. Lotto is neither a program nor a project of the national government,
but of a charitable institution, the PCSO. Though sanctioned by the national government, it is far fetched to say that
lotto falls within the contemplation of Sections 2 (c) and 27 of the Local Government Code.
Section 27 of the Code should be read in conjunction with Section 26 thereof.[17] Section 26 reads:
Section 26. Duty of National Government Agencies in the Maintenance of Ecological Balance. It shall be the duty of every
national agency or government-owned or controlled corporation authorizing or involved in the planning and
implementation of any project or program that may cause pollution, climatic change, depletion of non-renewable
resources, loss of crop land, range-land, or forest cover, and extinction of animal or plant species, to consult with the
local government units, nongovernmental organizations, and other sectors concerned and explain the goals and
objectives of the project or program, its impact upon the people and the community in terms of environmental or
ecological balance, and the measures that will be undertaken to prevent or minimize the adverse effects thereof.
Thus, the projects and programs mentioned in Section 27 should be interpreted to mean projects and programs whose
effects are among those enumerated in Section 26 and 27, to wit, those that: (1) may cause pollution; (2) may bring
about climatic change; (3) may cause the depletion of non-renewable resources; (4) may result in loss of crop land,
range-land, or forest cover; (5) may eradicate certain animal or plant species from the face of the planet; and (6) other
projects or programs that may call for the eviction of a particular group of people residing in the locality where these will
be implemented. Obviously, none of these effects will be produced by the introduction of lotto in the province of
Laguna.
Moreover, the argument regarding lack of consultation raised by petitioners is clearly an afterthought on their
part. There is no indication in the letter of Mayor Cataquiz that this was one of the reasons for his refusal to issue a
permit. That refusal was predicated solely but erroneously on the provisions of Kapasiyahan Blg. 508, Taon 1995, of
the Sangguniang Panlalawigan of Laguna.
In sum, we find no reversible error in the RTC decision enjoining Mayor Cataquiz from enforcing or implementing
the Kapasiyahan Blg. 508, T. 1995, of the Sangguniang Panlalawigan of Laguna. That resolution expresses merely a policy
statement of the Laguna provincial board. It possesses no binding legal force nor requires any act of implementation. It
provides no sufficient legal basis for respondent mayors refusal to issue the permit sought by private respondent in
connection with a legitimate business activity authorized by a law passed by Congress.
WHEREFORE, the petition is DENIED for lack of merit. The Order of the Regional Trial Court of San Pedro, Laguna
enjoining the petitioners from implementing or enforcing Resolution or Kapasiyahan Blg. 508, T. 1995, of the Provincial
Board of Laguna is hereby AFFIRMED. No costs.
SO ORDERED.
Bellosillo, (Chairman), Mendoza, Buena, and De Leon, Jr., JJ., concur.
EN BANC
[G.R. Nos. 84132-33 : December 10, 1990.]
192 SCRA 257
NATIONAL DEVELOPMENT COMPANY AND NEW AGRIX, INC., Petitioners, vs. PHILIPPINE VETERANS BANK, THE EX-
OFFICIO SHERIFF and GODOFREDO QUILING, in his capacity as Deputy Sheriff of Calamba, Laguna, Respondents.

DECISION

CRUZ, J.:

This case involves the constitutionality of a presidential decree which, like all other issuances of President Marcos during
his regime, was at that time regarded as sacrosanct. It is only now, in a freer atmosphere, that his acts are being tested
by the touchstone of the fundamental law that even then was supposed to limit presidential action.: rd
The particular enactment in question is Pres. Decree No. 1717, which ordered the rehabilitation of the Agrix Group of
Companies to be administered mainly by the National Development Company. The law outlined the procedure for filing
claims against the Agrix companies and created a Claims Committee to process these claims. Especially relevant to this
case, and noted at the outset, is Sec. 4(1) thereof providing that "all mortgages and other liens presently attaching to
any of the assets of the dissolved corporations are hereby extinguished."
Earlier, the Agrix Marketing, Inc. (AGRIX) had executed in favor of private respondent Philippine Veterans Bank a real
estate mortgage dated July 7, 1978, over three (3) parcels of land situated in Los Baños, Laguna. During the existence of
the mortgage, AGRIX went bankrupt. It was for the expressed purpose of salvaging this and the other Agrix companies
that the aforementioned decree was issued by President Marcos.
Pursuant thereto, the private respondent filed a claim with the AGRIX Claims Committee for the payment of its loan
credit. In the meantime, the New Agrix, Inc. and the National Development Company, petitioners herein, invoking Sec. 4
(1) of the decree, filed a petition with the Regional Trial Court of Calamba, Laguna, for the cancellation of the mortgage
lien in favor of the private respondent. For its part, the private respondent took steps to extrajudicially foreclose the
mortgage, prompting the petitioners to file a second case with the same court to stop the foreclosure. The two cases
were consolidated.
After the submission by the parties of their respective pleadings, the trial court rendered the impugned decision. Judge
Francisco Ma. Guerrero annulled not only the challenged provision, viz., Sec. 4 (1), but the entire Pres. Decree No. 1717
on the grounds that: (1) the presidential exercise of legislative power was a violation of the principle of separation of
powers; (2) the law impaired the obligation of contracts; and (3) the decree violated the equal protection clause. The
motion for reconsideration of this decision having been denied, the present petition was filed.: rd
The petition was originally assigned to the Third Division of this Court but because of the constitutional questions
involved it was transferred to the Court en banc. On August 30, 1988, the Court granted the petitioner's prayer for a
temporary restraining order and instructed the respondents to cease and desist from conducting a public auction sale of
the lands in question. After the Solicitor General and the private respondent had filed their comments and the
petitioners their reply, the Court gave due course to the petition and ordered the parties to file simultaneous
memoranda. Upon compliance by the parties, the case was deemed submitted.
The petitioners contend that the private respondent is now estopped from contesting the validity of the decree. In
support of this contention, it cites the recent case of Mendoza v. Agrix Marketing, Inc., 1 where the constitutionality of
Pres. Decree No. 1717 was also raised but not resolved. The Court, after noting that the petitioners had already filed
their claims with the AGRIX Claims Committee created by the decree, had simply dismissed the petition on the ground of
estoppel.
The petitioners stress that in the case at bar the private respondent also invoked the provisions of Pres. Decree No. 1717
by filing a claim with the AGRIX Claims Committee. Failing to get results, it sought to foreclose the real estate mortgage
executed by AGRIX in its favor, which had been extinguished by the decree. It was only when the petitioners challenged
the foreclosure on the basis of Sec. 4 (1) of the decree, that the private respondent attacked the validity of the provision.
At that stage, however, consistent with Mendoza, the private respondent was already estopped from questioning the
constitutionality of the decree.
The Court does not agree that the principle of estoppel is applicable.
It is not denied that the private respondent did file a claim with the AGRIX Claims Committee pursuant to this decree. It
must be noted, however, that this was done in 1980, when President Marcos was the absolute ruler of this country and
his decrees were the absolute law. Any judicial challenge to them would have been futile, not to say foolhardy. The
private respondent, no less than the rest of the nation, was aware of that reality and knew it had no choice under the
circumstances but to conform.: nad
It is true that there were a few venturesome souls who dared to question the dictator's decisions before the courts of
justice then. The record will show, however, that not a single act or issuance of President Marcos was ever declared
unconstitutional, not even by the highest court, as long as he was in power. To rule now that the private respondent is
estopped for having abided with the decree instead of boldly assailing it is to close our eyes to a cynical fact of life during
that repressive time.
This case must be distinguished from Mendoza, where the petitioners, after filing their claims with the AGRIX Claims
Committee, received in settlement thereof shares of stock valued at P40,000.00 without protest or reservation. The
herein private respondent has not been paid a single centavo on its claim, which was kept pending for more than seven
years for alleged lack of supporting papers. Significantly, the validity of that claim was not questioned by the petitioner
when it sought to restrain the extrajudicial foreclosure of the mortgage by the private respondent. The petitioner
limited itself to the argument that the private respondent was estopped from questioning the decree because of its
earlier compliance with its provisions.
Independently of these observations, there is the consideration that an affront to the Constitution cannot be allowed to
continue existing simply because of procedural inhibitions that exalt form over substance.
The Court is especially disturbed by Section 4(1) of the decree, quoted above, extinguishing all mortgages and other
liens attaching to the assets of AGRIX. It also notes, with equal concern, the restriction in Subsection (ii) thereof that all
"unsecured obligations shall not bear interest" and in Subsection (iii) that "all accrued interests, penalties or charges as
of date hereof pertaining to the obligations, whether secured or unsecured, shall not be recognized."
These provisions must be read with the Bill of Rights, where it is clearly provided in Section 1 that "no person shall be
deprived of life, liberty or property without due course of law nor shall any person be denied the equal protection of the
law" and in Section 10 that "no law impairing the obligation of contracts shall be passed."
In defending the decree, the petitioners argue that property rights, like all rights, are subject to regulation under the
police power for the promotion of the common welfare. The contention is that this inherent power of the state may be
exercised at any time for this purpose so long as the taking of the property right, even if based on contract, is done with
due process of law.
This argument is an over-simplification of the problem before us. The police power is not a panacea for all constitutional
maladies. Neither does its mere invocation conjure an instant and automatic justification for every act of the
government depriving a person of his life, liberty or property.
A legislative act based on the police power requires the concurrence of a lawful subject and a lawful method. In more
familiar words, a) the interests of the public generally, as distinguished from those of a particular class, should justify the
interference of the state; and b) the means employed are reasonably necessary for the accomplishment of the purpose
and not unduly oppressive upon individuals. 2
Applying these criteria to the case at bar, the Court finds first of all that the interests of the public are not sufficiently
involved to warrant the interference of the government with the private contracts of AGRIX. The decree speaks vaguely
of the "public, particularly the small investors," who would be prejudiced if the corporation were not to be assisted.
However, the record does not state how many there are of such investors, and who they are, and why they are being
preferred to the private respondent and other creditors of AGRIX with vested property rights.:-cralaw
The public interest supposedly involved is not identified or explained. It has not been shown that by the creation of the
New Agrix, Inc. and the extinction of the property rights of the creditors of AGRIX, the interests of the public as a whole,
as distinguished from those of a particular class, would be promoted or protected. The indispensable link to the welfare
of the greater number has not been established. On the contrary, it would appear that the decree was issued only to
favor a special group of investors who, for reasons not given, have been preferred to the legitimate creditors of AGRIX.
Assuming there is a valid public interest involved, the Court still finds that the means employed to rehabilitate AGRIX fall
far short of the requirement that they shall not be unduly oppressive. The oppressiveness is patent on the face of the
decree. The right to property in all mortgages, liens, interests, penalties and charges owing to the creditors of AGRIX is
arbitrarily destroyed. No consideration is paid for the extinction of the mortgage rights. The accrued interests and other
charges are simply rejected by the decree. The right to property is dissolved by legislative fiat without regard to the
private interest violated and, worse, in favor of another private interest.
A mortgage lien is a property right derived from contract and so comes under the protection of the Bill of Rights. So do
interests on loans, as well as penalties and charges, which are also vested rights once they accrue. Private property
cannot simply be taken by law from one person and given to another without compensation and any known public
purpose. This is plain arbitrariness and is not permitted under the Constitution.
And not only is there arbitrary taking, there is discrimination as well. In extinguishing the mortgage and other liens, the
decree lumps the secured creditors with the unsecured creditors and places them on the same level in the prosecution
of their respective claims. In this respect, all of them are considered unsecured creditors. The only concession given to
the secured creditors is that their loans are allowed to earn interest from the date of the decree, but that still does not
justify the cancellation of the interests earned before that date. Such interests, whether due to the secured or the
unsecured creditors, are all extinguished by the decree. Even assuming such cancellation to be valid, we still cannot see
why all kinds of creditors, regardless of security, are treated alike.
Under the equal protection clause, all persons or things similarly situated must be treated alike, both in the privileges
conferred and the obligations imposed. Conversely, all persons or things differently situated should be treated
differently. In the case at bar, persons differently situated are similarly treated, in disregard of the principle that there
should be equality only among equals.- nad
One may also well wonder why AGRIX was singled out for government help, among other corporations where the
stockholders or investors were also swindled. It is not clear why other companies entitled to similar concern were not
similarly treated. And surely, the stockholders of the private respondent, whose mortgage lien had been cancelled and
legitimate claims to accrued interests rejected, were no less deserving of protection, which they did not get. The decree
operated, to use the words of a celebrated case, 3 "with an evil eye and an uneven hand."
On top of all this, New Agrix, Inc. was created by special decree notwithstanding the provision of Article XIV, Section 4 of
the 1973 Constitution, then in force, that:
SEC. 4. The Batasang Pambansa shall not, except by general law, provide for the formation, organization, or regulation of
private corporations, unless such corporations are owned or controlled by the Government or any subdivision or
instrumentality thereof. 4
The new corporation is neither owned nor controlled by the government. The National Development Corporation was
merely required to extend a loan of not more than P10,000,000.00 to New Agrix, Inc. Pending payment thereof, NDC
would undertake the management of the corporation, but with the obligation of making periodic reports to the Agrix
board of directors. After payment of the loan, the said board can then appoint its own management. The stocks of the
new corporation are to be issued to the old investors and stockholders of AGRIX upon proof of their claims against the
abolished corporation. They shall then be the owners of the new corporation. New Agrix, Inc. is entirely private and so
should have been organized under the Corporation Law in accordance with the above-cited constitutional provision.
The Court also feels that the decree impairs the obligation of the contract between AGRIX and the private respondent
without justification. While it is true that the police power is superior to the impairment clause, the principle will apply
only where the contract is so related to the public welfare that it will be considered congenitally susceptible to change
by the legislature in the interest of the greater number. 5 Most present-day contracts are of that nature. But as already
observed, the contracts of loan and mortgage executed by AGRIX are purely private transactions and have not been
shown to be affected with public interest. There was therefore no warrant to amend their provisions and deprive the
private respondent of its vested property rights.
It is worth noting that only recently in the case of the Development Bank of the Philippines v. NLRC, 6 we sustained the
preference in payment of a mortgage creditor as against the argument that the claims of laborers should take
precedence over all other claims, including those of the government. In arriving at this ruling, the Court recognized the
mortgage lien as a property right protected by the due process and contract clauses notwithstanding the argument that
the amendment in Section 110 of the Labor Code was a proper exercise of the police power.: nad
The Court reaffirms and applies that ruling in the case at bar.
Our finding, in sum, is that Pres. Decree No. 1717 is an invalid exercise of the police power, not being in conformity with
the traditional requirements of a lawful subject and a lawful method. The extinction of the mortgage and other liens and
of the interest and other charges pertaining to the legitimate creditors of AGRIX constitutes taking without due process
of law, and this is compounded by the reduction of the secured creditors to the category of unsecured creditors in
violation of the equal protection clause. Moreover, the new corporation, being neither owned nor controlled by the
Government, should have been created only by general and not special law. And insofar as the decree also interferes
with purely private agreements without any demonstrated connection with the public interest, there is likewise an
impairment of the obligation of the contract.
With the above pronouncements, we feel there is no more need to rule on the authority of President Marcos to
promulgate Pres. Decree No. 1717 under Amendment No. 6 of the 1973 Constitution. Even if he had such authority, the
decree must fall just the same because of its violation of the Bill of Rights.
WHEREFORE, the petition is DISMISSED. Pres. Decree No. 1717 is declared UNCONSTITUTIONAL. The temporary
restraining order dated August 30, 1988, is LIFTED. Costs against the petitioners.- nad
SO ORDERED.
Fernan (C.J.), Narvasa, Gutierrez, Jr., Paras, Gancayco Padilla, Bidin, Sarmiento, Griño-Aquino, Medialdea and Regalado,
JJ., concur.
Melencio-Herrera, J., In the result. In Dumlao v. COMELEC, 95 SCRA 392 (1980), a portion of the second paragraph of
section 4 of Batas Pambansa Blg. 52 was declared null and void for being unconstitutional.
Feliciano, J., is on leave.
SOCIAL JUSTICE SOCIETY G.R. No. 156052
(SJS), VLADIMIR ALARIQUE T.
CABIGAO and BONIFACIO S.
TUMBOKON,
Petitioners, Present:

PUNO, C.J., Chairperson,


SANDOVAL-GUTIERREZ,
- v e r s u s - CORONA,
AZCUNA and
LEONARDO-DE CASTRO, JJ.

HON. JOSE L. ATIENZA, JR.,


in his capacity as Mayor of the
City of Manila,
Respondent.
x----------------------x
CHEVRON PHILIPPINES INC.,
PETRON CORPORATION and
PILIPINAS SHELL PETROLEUM
CORPORATION,
Movants-Intervenors.
x----------------------x
DEPARTMENT OF ENERGY,
Movant-Intervenor. Promulgated:

February 13, 2008


x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x
RESOLUTION
CORONA, J.:

After we promulgated our decision in this case on March 7, 2007, Chevron Philippines Inc. (Chevron), Petron Corporation
(Petron) and Pilipinas Shell Petroleum Corporation (Shell) (collectively, the oil companies) and the Republic of the
Philippines, represented by the Department of Energy (DOE), filed their respective motions for leave to intervene and
for reconsideration of the decision.
Chevron[1] is engaged in the business of importing, distributing and marketing of petroleum products in the Philippines
while Shell and Petron are engaged in the business of manufacturing, refining and likewise importing, distributing and
marketing of petroleum products in the Philippines.[2] The DOE is a governmental agency created under Republic Act
(RA) No. 7638[3] and tasked to prepare, integrate, coordinate, supervise and control all plans, programs, projects and
activities of the government relative to energy exploration, development, utilization, distribution and conservation.[4]
The facts are restated briefly as follows:

Petitioners Social Justice Society, Vladimir Alarique T. Cabigao and Bonifacio S. Tumbokon, in an original petition
for mandamusunder Rule 65 of the Rules of Court, sought to compel respondent Hon. Jose L. Atienza, Jr., then mayor of
the City of Manila, to enforce Ordinance No. 8027. This ordinance was enacted by the Sangguniang Panlungsod of
Manila on November 20, 2001,[5] approved by respondent Mayor on November 28, 2001,[6] and became effective on
December 28, 2001 after publication.[7] Sections 1 and 3 thereof state:

SECTION 1. For the purpose of promoting sound urban planning and ensuring health, public safety, and general welfare
of the residents of Pandacan and Sta. Ana as well as its adjoining areas, the land use of [those] portions of land bounded
by the Pasig River in the north, PNR Railroad Track in the east, Beata St. in the south, Palumpong St. in the southwest,
and Estero de Pandacan in the west[,] PNR Railroad in the northwest area, Estero de Pandacan in the [n]ortheast, Pasig
River in the southeast and Dr. M.L. Carreon in the southwest. The area of Punta, Sta. Ana bounded by the Pasig River,
Marcelino Obrero St., Mayo 28 St., and F. Manalo Street, are hereby reclassified from Industrial II to Commercial I.

xxx xxx xxx

SEC. 3. Owners or operators of industries and other businesses, the operation of which are no longer permitted under
Section 1 hereof, are hereby given a period of six (6) months from the date of effectivity of this Ordinance within which
to cease and desist from the operation of businesses which are hereby in consequence, disallowed.

Ordinance No. 8027 reclassified the area described therein from industrial to commercial and directed the owners and
operators of businesses disallowed under the reclassification to cease and desist from operating their businesses within
six months from the date of effectivity of the ordinance. Among the businesses situated in the area are the so-called
Pandacan Terminals of the oil companies.

On June 26, 2002, the City of Manila and the Department of Energy (DOE) entered into a memorandum of
understanding (MOU)[8] with the oil companies. They agreed that the scaling down of the Pandacan Terminals [was] the
most viable and practicable option. The Sangguniang Panlungsod ratified the MOU in Resolution No. 97.[9] In the same
resolution, the Sanggunian declared that the MOU was effective only for a period of six months starting July 25,
2002.[10] Thereafter, on January 30, 2003, the Sanggunian adopted Resolution No. 13[11] extending the validity of
Resolution No. 97 to April 30, 2003 and authorizing the mayor of Manila to issue special business permits to the oil
companies.[12]

This was the factual backdrop presented to the Court which became the basis of our March 7, 2007 decision. We ruled
that respondent had the ministerial duty under the Local Government Code (LGC) to enforce all laws and ordinances
relative to the governance of the city,[13] including Ordinance No. 8027. We also held that we need not resolve the
issue of whether the MOU entered into by respondent with the oil companies and the subsequent resolutions passed by
the Sanggunian could amend or repeal Ordinance No. 8027 since the resolutions which ratified the MOU and made it
binding on the City of Manila expressly gave it full force and effect only until April 30, 2003. We concluded that there
was nothing that legally hindered respondent from enforcing Ordinance No. 8027.

After we rendered our decision on March 7, 2007, the oil companies and DOE sought to intervene and filed motions for
reconsideration in intervention on March 12, 2007 and March 21, 2007 respectively. On April 11, 2007, we conducted
the oral arguments in Baguio City to hear petitioners, respondent and movants-intervenors oil companies and DOE.

The oil companies called our attention to the fact that on April 25, 2003, Chevron had filed a complaint against
respondent and the City of Manila in the Regional Trial Court (RTC) of Manila, Branch 39, for the annulment of
Ordinance No. 8027 with application for writs of preliminary prohibitory injunction and preliminary mandatory
injunction.[14] The case was docketed as civil case no. 03-106377. On the same day, Shell filed a petition for prohibition
and mandamus likewise assailing the validity of Ordinance No. 8027 and with application for writs of preliminary
prohibitory injunction and preliminary mandatory injunction.[15] This was docketed as civil case no. 03-106380. Later
on, these two cases were consolidated and the RTC of Manila, Branch 39 issued an order dated May 19, 2003 granting
the applications for writs of preliminary prohibitory injunction and preliminary mandatory injunction:

WHEREFORE, upon the filing of a total bond of TWO MILLION (Php 2,000,000.00) PESOS, let a Writ of Preliminary
Prohibitory Injunction be issued ordering [respondent] and the City of Manila, their officers, agents, representatives,
successors, and any other persons assisting or acting in their behalf, during the pendency of the case, to REFRAIN from
taking steps to enforce Ordinance No. 8027, and let a Writ of Preliminary Mandatory Injunction be issued ordering
[respondent] to issue [Chevron and Shell] the necessary Business Permits to operate at the Pandacan Terminal.[16]

Petron likewise filed its own petition in the RTC of Manila, Branch 42, also attacking the validity of Ordinance No. 8027
with prayer for the issuance of a writ of preliminary injunction and/or temporary restraining order (TRO). This was
docketed as civil case no. 03-106379. In an order dated August 4, 2004, the RTC enjoined the parties to maintain the
status quo.[17]
Thereafter, in 2006, the city council of Manila enacted Ordinance No. 8119, also known as the Manila Comprehensive
Land Use Plan and Zoning Ordinance of 2006.[18] This was approved by respondent on June 16, 2006.[19]

Aggrieved anew, Chevron and Shell filed a complaint in the RTC of Manila, Branch 20, asking for the nullification of
Ordinance No. 8119.[20] This was docketed as civil case no. 06-115334. Petron filed its own complaint on the same
causes of action in the RTC of Manila, Branch 41.[21] This was docketed as civil case no. 07-116700.[22] The court issued
a TRO in favor of Petron, enjoining the City of Manila and respondent from enforcing Ordinance No. 8119.[23]

Meanwhile, in civil case no. 03-106379, the parties filed a joint motion to withdraw complaint and counterclaim on
February 20, 2007.[24] In an order dated April 23, 2007, the joint motion was granted and all the claims and
counterclaims of the parties were withdrawn.[25]

Given these additional pieces of information, the following were submitted as issues for our resolution:

1. whether movants-intervenors should be allowed to intervene in this case;[26]


2. whether the following are impediments to the execution of our March 7, 2007 decision:
(a) Ordinance No. 8119, the enactment and existence of which were not previously brought by the parties to the
attention of the Court and
(b) writs of preliminary prohibitory injunction and preliminary mandatory injunction and status quo order issued by
the RTC of Manila, Branches 39 and 42 and
3. whether the implementation of Ordinance No. 8027 will unduly encroach upon the DOEs powers and functions
involving energy resources.

During the oral arguments, the parties submitted to this Courts power to rule on the constitutionality and validity of
Ordinance No. 8027 despite the pendency of consolidated cases involving this issue in the RTC.[27] The importance of
settling this controversy as fully and as expeditiously as possible was emphasized, considering its impact on public
interest. Thus, we will also dispose of this issue here. The parties were after all given ample opportunity to present and
argue their respective positions. By so doing, we will do away with the delays concomitant with litigation and completely
adjudicate an issue which will most likely reach us anyway as the final arbiter of all legal disputes.

Before we resolve these issues, a brief review of the history of the Pandacan Terminals is called for to put our discussion
in the proper context.

History Of The Pandacan


Oil Terminals

Pandacan (one of the districts of the City of Manila) is situated along the banks of the Pasig river. At the turn of the
twentieth century, Pandacan was unofficially designated as the industrial center of Manila. The area, then largely
uninhabited, was ideal for various emerging industries as the nearby river facilitated the transportation of goods and
products. In the 1920s, it was classified as an industrial zone.[28] Among its early industrial settlers were the oil
companies. Shell established its installation there on January 30, 1914.[29] Caltex (now Chevron) followed suit in 1917
when the company began marketing its products in the country.[30] In 1922, it built a warehouse depot which was later
converted into a key distribution terminal.[31] The corporate presence in the Philippines of Esso (Petrons predecessor)
became more keenly felt when it won a concession to build and operate a refinery in Bataan in 1957.[32] It then went
on to operate a state-of-the-art lube oil blending plant in the Pandacan Terminals where it manufactures lubes and
greases.[33]

On December 8, 1941, the Second World War reached the shores of the Philippine Islands. Although Manila was
declared an open city, the Americans had no interest in welcoming the Japanese. In fact, in their zealous attempt to fend
off the Japanese Imperial Army, the United States Army took control of the Pandacan Terminals and hastily made plans
to destroy the storage facilities to deprive the advancing Japanese Army of a valuable logistics weapon.[34] The U.S.
Army burned unused petroleum, causing a frightening conflagration. Historian Nick Joaquin recounted the events as
follows:

After the USAFFE evacuated the City late in December 1941, all army fuel storage dumps were set on fire. The flames
spread, enveloping the City in smoke, setting even the rivers ablaze, endangering bridges and all riverside buildings. For
one week longer, the open city blazeda cloud of smoke by day, a pillar of fire by night.[35]

The fire consequently destroyed the Pandacan Terminals and rendered its network of depots and service stations
inoperative.[36]

After the war, the oil depots were reconstructed. Pandacan changed as Manila rebuilt itself. The three major oil
companies resumed the operation of their depots.[37] But the district was no longer a sparsely populated industrial
zone; it had evolved into a bustling, hodgepodge community. Today, Pandacan has become a densely populated area
inhabited by about 84,000 people, majority of whom are urban poor who call it home.[38] Aside from numerous
industrial installations, there are also small businesses, churches, restaurants, schools, daycare centers and residences
situated there.[39] Malacaang Palace, the official residence of the President of the Philippines and the seat of
governmental power, is just two kilometers away.[40] There is a private school near the Petron depot. Along the walls of
the Shell facility are shanties of informal settlers.[41] More than 15,000 students are enrolled in elementary and high
schools situated near these facilities.[42] A university with a student population of about 25,000 is located directly
across the depot on the banks of the Pasig river.[43]
The 36-hectare Pandacan Terminals house the oil companies distribution terminals and depot facilities.[44] The
refineries of Chevron and Shell in Tabangao and Bauan, both in Batangas, respectively, are connected to the Pandacan
Terminals through a 114-kilometer[45] underground pipeline system.[46] Petrons refinery in Limay, Bataan, on the other
hand, also services the depot.[47] The terminals store fuel and other petroleum products and supply 95% of the fuel
requirements of Metro Manila,[48] 50% of Luzons consumption and 35% nationwide.[49] Fuel can also be transported
through barges along the Pasig river or tank trucks via the South Luzon Expressway.

We now discuss the first issue: whether movants-intervenors should be allowed to intervene in this case.

Intervention Of The Oil Companies And The DOE Should Be Allowed In The Interest of Justice

Intervention is a remedy by which a third party, not originally impleaded in the proceedings, becomes a litigant therein
to enable him, her or it to protect or preserve a right or interest which may be affected by such proceedings.[50] The
pertinent rules are Sections 1 and 2, Rule 19 of the Rules of Court:

SEC. 1. Who may intervene. A person who has a legal interest in the matter in litigation, or in the success of either of the
parties, or an interest against both, or is so situated as to be adversely affected by a distribution or other disposition of
property in the custody of the court or of an officer thereof may, with leave of court, be allowed to intervene in the
action. The court shall consider whether or not the intervention will unduly delay or prejudice the adjudication of the
rights of the original parties, and whether or not the intervenors rights may be fully protected in a separate proceeding.

SEC. 2. Time to intervene. The motion to intervene may be filed at any time before rendition of judgment by the trial
court. A copy of the pleading-in-intervention shall be attached to the motion and served on the original parties.

Thus, the following are the requisites for intervention of a non-party:


(1) Legal interest
(a) in the matter in controversy; or
(b) in the success of either of the parties; or
I against both parties; or
(d) person is so situated as to be adversely affected by a distribution or other disposition of property in the custody of
the court or of an officer thereof;

(2) Intervention will not unduly delay or prejudice the adjudication of rights of original parties;

(3) Intervenors rights may not be fully protected in a separate proceeding[51] and

(g)The motion to intervene may be filed at any time before rendition of judgment by the trial court.

For both the oil companies and DOE, the last requirement is definitely absent. As a rule, intervention is allowed before
rendition of judgment as Section 2, Rule 19 expressly provides. Both filed their separate motions after our decision was
promulgated. In Republic of the Philippines v. Gingoyon,[52] a recently decided case which was also an original action
filed in this Court, we declared that the appropriate time to file the motions-in-intervention was before and not after
resolution of the case.[53]

The Court, however, has recognized exceptions to Section 2, Rule 19 in the interest of substantial justice:

The rule on intervention, like all other rules of procedure, is intended to make the powers of the Court fully and
completely available for justice. It is aimed to facilitate a comprehensive adjudication of rival claims overriding
technicalities on the timeliness of the filing thereof.[54]

The oil companies assert that they have a legal interest in this case because the implementation of Ordinance No. 8027
will directly affect their business and property rights.[55]

[T]he interest which entitles a person to intervene in a suit between other parties must be in the matter in litigation and
of such direct and immediate character that the intervenor will either gain or lose by direct legal operation and effect of
the judgment. Otherwise, if persons not parties to the action were allowed to intervene, proceedings would become
unnecessarily complicated, expensive and interminable. And this would be against the policy of the law. The words an
interest in the subject means a direct interest in the cause of action as pleaded, one that would put the intervenor in a
legal position to litigate a fact alleged in the complaint without the establishment of which plaintiff could not
recover.[56]

We agree that the oil companies have a direct and immediate interest in the implementation of Ordinance No.
8027. Their claim is that they will need to spend billions of pesos if they are compelled to relocate their oil depots out of
Manila. Considering that they admitted knowing about this case from the time of its filing on December 4, 2002, they
should have intervened long before our March 7, 2007 decision to protect their interests. But they did not.[57] Neither
did they offer any worthy explanation to justify their late intervention.

Be that as it may, although their motion for intervention was not filed on time, we will allow it because they raised and
presented novel issues and arguments that were not considered by the Court in its March 7, 2007 decision. After all, the
allowance or disallowance of a motion to intervene is addressed to the sound discretion of the court before which the
case is pending.[58] Considering the compelling reasons favoring intervention, we do not think that this will unduly delay
or prejudice the adjudication of rights of the original parties. In fact, it will be expedited since their intervention will
enable us to rule on the constitutionality of Ordinance No. 8027 instead of waiting for the RTCs decision.
The DOE, on the other hand, alleges that its interest in this case is also direct and immediate as Ordinance No. 8027
encroaches upon its exclusive and national authority over matters affecting the oil industry. It seeks to intervene in
order to represent the interests of the members of the public who stand to suffer if the Pandacan Terminals operations
are discontinued. We will tackle the issue of the alleged encroachment into DOEs domain later on. Suffice it to say at this
point that, for the purpose of hearing all sides and considering the transcendental importance of this case, we will also
allow DOEs intervention.

The Injunctive Writs Are Not Impediments To The Enforcement Of Ordinance No. 8027

Under Rule 65, Section 3[59] of the Rules of Court, a petition for mandamus may be filed when any tribunal,
corporation, board, officer or person unlawfully neglects the performance of an act which the law specifically enjoins as
a duty resulting from an office, trust or station. According to the oil companies, respondent did not unlawfully fail or
neglect to enforce Ordinance No. 8027 because he was lawfully prevented from doing so by virtue of the injunctive writs
and status quo order issued by the RTC of Manila, Branches 39 and 42.

First, we note that while Chevron and Shell still have in their favor the writs of preliminary injunction and preliminary
mandatory injunction, the status quo order in favor of Petron is no longer in effect since the court granted the joint
motion of the parties to withdraw the complaint and counterclaim.[60]

Second, the original parties failed to inform the Court about these injunctive writs. Respondent (who was also
impleaded as a party in the RTC cases) defends himself by saying that he informed the court of the pendency of the civil
cases and that a TRO was issued by the RTC in the consolidated cases filed by Chevron and Shell. It is true that had the
oil companies only intervened much earlier, the Court would not have been left in the dark about these facts.
Nevertheless, respondent should have updated the Court, by way of manifestation, on such a relevant matter.

In his memorandum, respondent mentioned the issuance of a TRO. Under Section 5 of Rule 58 of the Rules of Court, a
TRO issued by the RTC is effective only for a period of 20 days. This is why, in our March 7, 2007 decision, we presumed
with certainty that this had already lapsed.[61] Respondent also mentioned the grant of injunctive writs in his rejoinder
which the Court, however, expunged for being a prohibited pleading. The parties and their counsels were clearly remiss
in their duties to this Court.

In resolving controversies, courts can only consider facts and issues pleaded by the parties.[62] Courts, as well as
magistrates presiding over them are not omniscient. They can only act on the facts and issues presented before them in
appropriate pleadings. They may not even substitute their own personal knowledge for evidence. Nor may they take
notice of matters except those expressly provided as subjects of mandatory judicial notice.

We now proceed to the issue of whether the injunctive writs are legal impediments to the enforcement of Ordinance
No. 8027.

Section 3, Rule 58 of the Rules of Court enumerates the grounds for the issuance of a writ of preliminary injunction:

SEC. 3. Grounds for issuance of preliminary injunction. ― A preliminary injunction may be granted when it is established:

(a) That the applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining
the commission or continuance of the act or acts complained of, or in requiring the performance of an act or acts, either
for a limited period or perpetually;

(b) That the commission, continuance or nonperformance of the act or acts complained of during the litigation would
probably work injustice to the applicant; or
(g) IThat a party, court, agency or a person is doing, threatening, or is attempting to do, or is procuring or suffering
to be done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or
proceeding, and tending to render the judgment ineffectual.

There are two requisites for the issuance of a preliminary injunction: (1) the right to be protected exists prima facie and
(2) the acts sought to be enjoined are violative of that right. It must be proven that the violation sought to be prevented
will cause an irreparable injustice.

The act sought to be restrained here was the enforcement of Ordinance No. 8027. It is a settled rule that an ordinance
enjoys the presumption of validity and, as such, cannot be restrained by injunction.[63] Nevertheless, when the validity
of the ordinance is assailed, the courts are not precluded from issuing an injunctive writ against its
enforcement. However, we have declared that the issuance of said writ is proper only when:

... the petitioner assailing the ordinance has made out a case of unconstitutionality strong enough to overcome, in the
mind of the judge, the presumption of validity, in addition to a showing of a clear legal right to the remedy
sought....[64] (Emphasis supplied)

Judge Reynaldo G. Ros, in his order dated May 19, 2003, stated his basis for issuing the injunctive writs:

The Court, in resolving whether or not a Writ of Preliminary Injunction or Preliminary Mandatory Injunction should be
issued, is guided by the following requirements: (1) a clear legal right of the complainant; (2) a violation of that right;
and (3) a permanent and urgent necessity for the Writ to prevent serious damage. The Court believes that these
requisites are present in these cases.

There is no doubt that the plaintiff/petitioners have been legitimately operating their business in the Pandacan Terminal
for many years and they have made substantial capital investment therein. Every year they were issued Business Permits
by the City of Manila. Its operations have not been declared illegal or contrary to law or morals. In fact, because of its
vital importance to the national economy, it was included in the Investment Priorities Plan as mandated under the
Downstream Oil Industry Deregulation Act of 1988 (R.A. 8479). As a lawful business, the plaintiff/petitioners have a
right, therefore, to continue their operation in the Pandacan Terminal and the right to protect their investments. This is
a clear and unmistakable right of the plaintiff/petitioners.

The enactment, therefore, of City Ordinance No. 8027 passed by the City Council of Manila reclassifying the area where
the Pandacan Terminal is located from Industrial II to Commercial I and requiring the plaintiff/petitioners to cease and
desist from the operation of their business has certainly violated the rights of the plaintiff/petitioners to continue their
legitimate business in the Pandacan Terminal and deprived them of their huge investments they put up therein. Thus,
before the Court, therefore, determines whether the Ordinance in question is valid or not, a Writ of Preliminary
Injunction and a Writ of Mandatory Injunction be issued to prevent serious and irreparable damage to
plaintiff/petitioners.[65]

Nowhere in the judges discussion can we see that, in addition to a showing of a clear legal right of Chevron and Shell to
the remedy sought, he was convinced that they had made out a case of unconstitutionality or invalidity strong enough
to overcome the presumption of validity of the ordinance. Statutes and ordinances are presumed valid unless and until
the courts declare the contrary in clear and unequivocal terms.[66] The mere fact that the ordinance is alleged to be
unconstitutional or invalid will not entitle a party to have its enforcement enjoined.[67] The presumption is all in favor of
validity. The reason for this is obvious:

The action of the elected representatives of the people cannot be lightly set aside. The councilors must, in the very
nature of things, be familiar with the necessities of their particular municipality and with all the facts and circumstances
which surround the subject and necessitate action. The local legislative body, by enacting the ordinance, has in effect
given notice that the regulations are essential to the well being of the people . . . The Judiciary should not lightly set
aside legislative action when there is not a clear invasion of personal or property rights under the guise of police
regulation.[68]

Xxx
...[Courts] accord the presumption of constitutionality to legislative enactments, not only because the legislature is
presumed to abide by the Constitution but also because the judiciary[,] in the determination of actual cases and
controversies[,] must reflect the wisdom and justice of the people as expressed through their representatives in the
executive and legislative departments of the government.[69]

The oil companies argue that this presumption must be set aside when the invalidity or unreasonableness appears on
the face of the ordinance itself.[70] We see no reason to set aside the presumption. The ordinance, on its face, does not
at all appear to be unconstitutional. It reclassified the subject area from industrial to commercial. Prima facie, this power
is within the power of municipal corporations:

The power of municipal corporations to divide their territory into industrial, commercial and residential zones is
recognized in almost all jurisdictions inasmuch as it is derived from the police power itself and is exercised for the
protection and benefit of their inhabitants.[71]

Xxx
There can be no doubt that the City of Manila has the power to divide its territory into residential and industrial zones,
and to prescribe that offensive and unwholesome trades and occupations are to be established exclusively in the latter
zone.

Xxx xxx xxx


Likewise, it cannot be denied that the City of Manila has the authority, derived from the police power, of forbidding the
appellant to continue the manufacture of toyoin the zone where it is now situated, which has been declared
residential....[72]

Courts will not invalidate an ordinance unless it clearly appears that it is unconstitutional. There is no such showing here.
Therefore, the injunctive writs issued in the Manila RTCs May 19, 2003 order had no leg to stand on.

We are aware that the issuance of these injunctive writs is not being assailed as tainted with grave abuse of
discretion. However, we are confronted with the question of whether these writs issued by a lower court are
impediments to the enforcement of Ordinance No. 8027 (which is the subject of the mandamus petition). As already
discussed, we rule in the negative.

Ordinance No. 8027 Was Not Superseded By Ordinance No. 8119

The March 7, 2007 decision did not take into consideration the passage of Ordinance No. 8119 entitled An Ordinance
Adopting the Manila Comprehensive Land Use Plan and Zoning Regulations of 2006 and Providing for the
Administration, Enforcement and Amendment thereto which was approved by respondent on June 16, 2006. The simple
reason was that the Court was never informed about this ordinance.

While courts are required to take judicial notice of the laws enacted by Congress, the rule with respect to local
ordinances is different.Ordinances are not included in the enumeration of matters covered by mandatory judicial notice
under Section 1, Rule 129 of the Rules of Court.[73]
Although, Section 50 of RA 409[74] provides that:

SEC. 50 Judicial notice of ordinances. - All courts sitting in the city shall take judicial notice of the ordinances passed by
the [Sangguniang Panglungsod].

This cannot be taken to mean that this Court, since it has its seat in the City of Manila, should have taken steps to
procure a copy of the ordinance on its own, relieving the party of any duty to inform the Court about it.
Even where there is a statute that requires a court to take judicial notice of municipal ordinances, a court is not required
to take judicial notice of ordinances that are not before it and to which it does not have access. The party asking the
court to take judicial notice is obligated to supply the court with the full text of the rules the party desires it to have
notice of.[75] Counsel should take the initiative in requesting that a trial court take judicial notice of an ordinance even
where a statute requires courts to take judicial notice of local ordinances.[76]
The intent of a statute requiring a court to take judicial notice of a local ordinance is to remove any discretion a court
might have in determining whether or not to take notice of an ordinance. Such a statute does not direct the court to act
on its own in obtaining evidence for the record and a party must make the ordinance available to the court for it to take
notice.[77]

In its defense, respondent claimed that he did not inform the Court about the enactment of Ordinance No. 8119
because he believed that it was different from Ordinance No. 8027 and that the two were not inconsistent with each
other.[78]

In the same way that we deem the intervenors late intervention in this case unjustified, we find the failure of
respondent, who was an original party here, inexcusable.

The Rule On Judicial Admissions Is Not Applicable Against Respondent


The oil companies assert that respondent judicially admitted that Ordinance No. 8027 was repealed by Ordinance No.
8119 in civil case no. 03-106379 (where Petron assailed the constitutionality of Ordinance No. 8027) when the parties in
their joint motion to withdraw complaint and counterclaim stated that the issue ...has been rendered moot and
academic by virtue of the passage of [Ordinance No. 8119].[79] They contend that such admission worked as an
estoppel against the respondent.

Respondent countered that this stipulation simply meant that Petron was recognizing the validity and legality of
Ordinance No. 8027 and that it had conceded the issue of said ordinances constitutionality, opting instead to question
the validity of Ordinance No. 8119.[80] The oil companies deny this and further argue that respondent, in his answer in
civil case no. 06-115334 (where Chevron and Shell are asking for the nullification of Ordinance No. 8119), expressly
stated that Ordinance No. 8119 replaced Ordinance No. 8027:[81]

... Under Ordinance No. 8027, businesses whose uses are not in accord with the reclassification were given six months to
cease [their] operation. Ordinance No. 8119, which in effect, replaced Ordinance [No.] 8027, merely took note of the
time frame provided for in Ordinance No. 8119.... Ordinance No. 8119 thus provided for an even longer term, that is[,]
seven years;[82] (Emphasis supplied)
Rule 129, Section 4 of the Rules of Court provides:

Section 4. Judicial admissions. ― An admission, verbal or written, made by a party in the course of the proceedings in
the same case, does not require proof. The admission may be contradicted only by showing that it was made through
palpable mistake or that no such admission was made. (Emphasis supplied)

While it is true that a party making a judicial admission cannot subsequently take a position contrary to or inconsistent
with what was pleaded,[83] the aforestated rule is not applicable here. Respondent made the statements regarding the
ordinances in civil case nos. 03-106379 and 06-115334 which are not the same as this case before us.[84] To constitute a
judicial admission, the admission must be made in the same case in which it is offered.
Hence, respondent is not estopped from claiming that Ordinance No. 8119 did not supersede Ordinance No. 8027. On
the contrary, it is the oil companies which should be considered estopped. They rely on the argument that Ordinance
No. 8119 superseded Ordinance No. 8027 but, at the same time, also impugn its (8119s) validity. We frown on the
adoption of inconsistent positions and distrust any attempt at clever positioning under one or the other on the basis of
what appears advantageous at the moment. Parties cannot take vacillating or contrary positions regarding the validity of
a statute[85] or ordinance. Nonetheless, we will look into the merits of the argument of implied repeal.

Ordinance No. 8119 Did Not Impliedly Repeal Ordinance No. 8027
Both the oil companies and DOE argue that Ordinance No. 8119 repealed Ordinance No. 8027. They assert that although
there was no express repeal[86] of Ordinance No. 8027, Ordinance No. 8119 impliedly repealed it.

According to the oil companies, Ordinance No. 8119 reclassified the area covering the Pandacan Terminals to High
Density Residential/Mixed Use Zone (R-3/MXD)[87] whereas Ordinance No. 8027 reclassified the same area from
Industrial II to Commercial I:

SECTION 1. For the purpose of promoting sound urban planning and ensuring health, public safety, and general welfare
of the residents of Pandacan and Sta. Ana as well as its adjoining areas, the land use of [those] portions of land bounded
by the Pasig River in the north, PNR Railroad Track in the east, Beata St. in the south, Palumpong St. in the southwest,
and Estero de Pancacan in the west[,] PNR Railroad in the northwest area, Estero de Pandacan in the [n]ortheast, Pasig
River in the southeast and Dr. M.L. Carreon in the southwest. The area of Punta, Sta. Ana bounded by the Pasig River,
Marcelino Obrero St., Mayo 28 St., and F. Manalo Street, are hereby reclassified from Industrial II to Commercial I.
(Emphasis supplied)

Moreover, Ordinance No. 8119 provides for a phase-out of seven years:

SEC. 72. Existing Non-Conforming Uses and Buildings. - The lawful use of any building, structure or land at the time of
the adoption of this Ordinance may be continued, although such use does not conform with the provision of the
Ordinance, provided:

xxx xxx xxx

(g) In case the non-conforming use is an industrial use:

xxx xxx xxx

d. The land use classified as non-conforming shall program the phase-out and relocation of the non-conforming use
within seven (7) years from the date of effectivity of this Ordinance. (Emphasis supplied)

This is opposed to Ordinance No. 8027 which compels affected entities to vacate the area within six months from the
effectivity of the ordinance:

SEC. 3. Owners or operators of industries and other businesses, the operation of which are no longer permitted under
Section 1 hereof, are hereby given a period of six (6) months from the date of effectivity of this Ordinance within which
to cease and desist from the operation of businesses which are hereby in consequence, disallowed.

Ordinance No. 8119 also designated the Pandacan oil depot area as a Planned Unit Development/Overlay Zone (O-PUD):

SEC. 23. Use Regulations in Planned Unit Development/Overlay Zone (O-PUD). O-PUD Zones are identified specific sites
in the City of Manila wherein the project site is comprehensively planned as an entity via unitary site plan which permits
flexibility in planning/ design, building siting, complementarily of building types and land uses, usable open spaces and
the preservation of significant natural land features, pursuant to regulations specified for each particular
PUD. Enumerated below are identified PUD:

xxx xxx xxx


6. Pandacan Oil Depot Area

xxx xxx xxx


Enumerated below are the allowable uses:
1. all uses allowed in all zones where it is located
2. the [Land Use Intensity Control (LUIC)] under which zones are located shall, in all instances be complied with
3. the validity of the prescribed LUIC shall only be [superseded] by the development controls and regulations
specified for each PUD as provided for each PUD as provided for by the masterplan of respective PUDs.[88] (Emphasis
supplied)
Respondent claims that in passing Ordinance No. 8119, the Sanggunian did not intend to repeal Ordinance No. 8027 but
meant instead to carry over 8027s provisions to 8119 for the purpose of making Ordinance No. 8027 applicable to the oil
companies even after the passage of Ordinance No. 8119.[89] He quotes an excerpt from the minutes of the July 27,
2004 session of the Sanggunian during the first reading of Ordinance No. 8119:
Member GARCIA: Your Honor, iyong patungkol po roon sa oil depot doon sa amin sa Sixth District sa Pandacan, wala
pong nakalagay eith sa ordinansa rito na taliwas o kakaiba roon sa ordinansang ipinasa noong nakaraang Konseho, iyong
Ordinance No. 8027. So kung ano po ang nandirito sa ordinansa na ipinasa ninyo last time, iyon lang po ang ni-lift eithe
at inilagay eith. At eith eith ordinansang iyong naipasa ng huling Konseho, niri-classify [ninyo] from Industrial II to
Commercial C-1 ang area ng Pandacan kung nasaan ang oil depot. So ini-lift lang po [eithe] iyong definition, density, at
saka po yon pong ng noong ordinansa ninyo na siya eith naming inilagay eith, iniba lang po naming iyong title. So wala
po kaming binago na taliwas o nailagay na taliwas doon sa ordinansang ipinasa ninyo, ni-lift lang po [eithe] from
Ordinance No. 8027.[90] (Emphasis supplied)

We agree with respondent.

Repeal by implication proceeds on the premise that where a statute of later date clearly reveals the intention of the
legislature to abrogate a prior act on the subject, that intention must be given effect.[91]

There are two kinds of implied repeal. The first is: where the provisions in the two acts on the same subject matter are
irreconcilably contradictory, the latter act, to the extent of the conflict, constitutes an implied repeal of the earlier
one.[92] The second is: if the later act covers the whole subject of the earlier one and is clearly intended as a substitute,
it will operate to repeal the earlier law.[93] The oil companies argue that the situation here falls under the first category.

Implied repeals are not favored and will not be so declared unless the intent of the legislators is manifest.[94] As
statutes and ordinances are presumed to be passed only after careful deliberation and with knowledge of all existing
ones on the subject, it follows that, in passing a law, the legislature did not intend to interfere with or abrogate a former
law relating to the same subject matter.[95] If the intent to repeal is not clear, the later act should be construed as a
continuation of, and not a substitute for, the earlier act.[96]

These standards are deeply enshrined in our jurisprudence. We disagree that, in enacting Ordinance No. 8119, there was
any indication of the legislative purpose to repeal Ordinance No. 8027.[97] The excerpt quoted above is proof that there
was never such an intent. While it is true that both ordinances relate to the same subject matter, i.e. classification of the
land use of the area where Pandacan oil depot is located, if there is no intent to repeal the earlier enactment, every
effort at reasonable construction must be made to reconcile the ordinances so that both can be given effect:

The fact that a later enactment may relate to the same subject matter as that of an earlier statute is not of itself
sufficient to cause an implied repeal of the prior act, since the new statute may merely be cumulative or a continuation
of the old one. What is necessary is a manifest indication of legislative purpose to repeal.[98]

For the first kind of implied repeal, there must be an irreconcilable conflict between the two ordinances. There is no
conflict between the two ordinances. Ordinance No. 8027 reclassified the Pandacan area from Industrial II to
Commercial I. Ordinance No. 8119, in Section 23, designated it as a Planned Unit Development/Overlay Zone (O-PUD). In
its Annex C which defined the zone boundaries,[99] the Pandacan area was shown to be within the High Density
Residential/Mixed Use Zone (R-3/MXD). These zone classifications in Ordinance No. 8119 are not inconsistent with the
reclassification of the Pandacan area from Industrial to Commercial in Ordinance No. 8027. The O-PUD classification
merely made Pandacan a project site ... comprehensively planned as an entity via unitary site plan which permits
flexibility in planning/design, building siting, complementarity of building types and land uses, usable open spaces and
the preservation of significant natural land features....[100] Its classification as R-3/MXD means that it should be used
primarily for high-rise housing/dwelling purposes and limited complementary/supplementary trade, services and
business activities.[101] There is no conflict since both ordinances actually have a common objective, i.e., to shift the
zoning classification from industrial to commercial (Ordinance No. 8027) or mixed residential/commercial (Ordinance
No. 8119).
Moreover, it is a well-settled rule in statutory construction that a subsequent general law does not repeal a prior special
law on the same subject unless it clearly appears that the legislature has intended by the latter general act to modify or
repeal the earlier special law. Generalia specialibus non derogant (a general law does not nullify a specific or special
law).[102] This is so even if the provisions of the general law are sufficiently comprehensive to include what was set
forth in the special act.[103] The special act and the general law must stand together, one as the law of the particular
subject and the other as the law of general application.[104] The special law must be taken as intended to constitute an
exception to, or a qualification of, the general act or provision.[105]

The reason for this is that the legislature, in passing a law of special character, considers and makes special provisions
for the particular circumstances dealt with by the special law. This being so, the legislature, by adopting a general law
containing provisions repugnant to those of the special law and without making any mention of its intention to amend
or modify such special law, cannot be deemed to have intended an amendment, repeal or modification of the
latter.[106]

Ordinance No. 8027 is a special law[107] since it deals specifically with a certain area described therein (the Pandacan oil
depot area) whereas Ordinance No. 8119 can be considered a general law[108] as it covers the entire city of Manila.

The oil companies assert that even if Ordinance No. 8027 is a special law, the existence of an all-encompassing repealing
clause in Ordinance No. 8119 evinces an intent on the part of the Sanggunian to repeal the earlier ordinance:

Sec. 84. Repealing Clause. All ordinances, rules, regulations in conflict with the provisions of this Ordinance are hereby
repealed; PROVIDED, That the rights that are vested upon the effectivity of this Ordinance shall not be impaired.

They cited Hospicio de San Jose de Barili, Cebu City v. Department of Agrarian Reform:[109]

The presence of such general repealing clause in a later statute clearly indicates the legislative intent to repeal all prior
inconsistent laws on the subject matter, whether the prior law is a general law or a special law... Without such a clause,
a later general law will ordinarily not repeal a prior special law on the same subject.But with such clause contained in the
subsequent general law, the prior special law will be deemed repealed, as the clause is a clear legislative intent to bring
about that result.[110]

This ruling in not applicable here. The repealing clause of Ordinance No. 8119 cannot be taken to indicate the legislative
intent to repeal all prior inconsistent laws on the subject matter, including Ordinance No. 8027, a special enactment,
since the aforequoted minutes (an official record of the discussions in the Sanggunian) actually indicated the clear intent
to preserve the provisions of Ordinance No. 8027.

To summarize, the conflict between the two ordinances is more apparent than real. The two ordinances can be
reconciled. Ordinance No. 8027 is applicable to the area particularly described therein whereas Ordinance No. 8119 is
applicable to the entire City of Manila.

Mandamus Lies To Compel Respondent Mayor To Enforce Ordinance No. 8027

The oil companies insist that mandamus does not lie against respondent in consideration of the separation of powers of
the executive and judiciary.[111] This argument is misplaced. Indeed,

[the] Courts will not interfere by mandamus proceedings with the legislative [or executive departments] of the
government in the legitimate exercise of its powers, except to enforce mere ministerial acts required by law to be
performed by some officer thereof.[112] (Emphasis Supplied)
since this is the function of a writ of mandamus, which is the power to compel the performance of an act which the law
specifically enjoins as a duty resulting from office, trust or station.[113]
They also argue that petitioners had a plain, speedy and adequate remedy to compel respondent to enforce Ordinance
No. 8027 which was to seek relief from the President of the Philippines through the Secretary of the Department of
Interior and Local Government (DILG) by virtue of the Presidents power of supervision over local government
units. Again, we disagree. A party need not go first to the DILG in order to compel the enforcement of an ordinance. This
suggested process would be unreasonably long, tedious and consequently injurious to the interests of the local
government unit (LGU) and its constituents whose welfare is sought to be protected. Besides, petitioners resort to an
original action for mandamus before this Court is undeniably allowed by the Constitution.[114]

Ordinance No. 8027 Is Constitutional And Valid

Having ruled that there is no impediment to the enforcement of Ordinance No. 8027, we now proceed to make a
definitive ruling on its constitutionality and validity.

The tests of a valid ordinance are well established. For an ordinance to be valid, it must not only be within the corporate
powers of the LGU to enact and be passed according to the procedure prescribed by law, it must also conform to the
following substantive requirements: (1) must not contravene the Constitution or any statute; (2) must not be unfair or
oppressive; (3) must not be partial or discriminatory; (4) must not prohibit but may regulate trade; (5) must be general
and consistent with public policy and (6) must not be unreasonable.[115]

The City of Manila Has The Power To Enact Ordinance No. 8027

Ordinance No. 8027 was passed by the Sangguniang Panlungsod of Manila in the exercise of its police power. Police
power is the plenary power vested in the legislature to make statutes and ordinances to promote the health, morals,
peace, education, good order or safety and general welfare of the people.[116] This power flows from the recognition
that salus populi est suprema lex (the welfare of the people is the supreme law).[117] While police power rests primarily
with the national legislature, such power may be delegated.[118] Section 16 of the LGC, known as the general welfare
clause, encapsulates the delegated police power to local governments:[119]

Section 16. General Welfare. ― Every local government unit shall exercise the powers expressly granted, those
necessarily implied therefrom, as well as powers necessary, appropriate, or incidental for its efficient and effective
governance, and those which are essential to the promotion of the general welfare. Within their respective territorial
jurisdictions, local government units shall ensure and support, among other things, the preservation and enrichment of
culture, promote health and safety, enhance the right of the people to a balanced ecology, encourage and support the
development of appropriate and self-reliant scientific and technological capabilities, improve public morals, enhance
economic prosperity and social justice, promote full employment among their residents, maintain peace and order, and
preserve the comfort and convenience of their inhabitants.

LGUs like the City of Manila exercise police power through their respective legislative bodies, in this case,
the Sangguniang Panlungsodor the city council. Specifically, the Sanggunian can enact ordinances for the general welfare
of the city:

Section. 458. Powers, Duties, Functions and Compensation. (a) The sangguniang panglungsod, as the legislative branch
of the city, shall enact ordinances, approve resolutions and appropriate funds for the general welfare of the city and its
inhabitants pursuant to Section 16 of this Code xxxx

This police power was also provided for in RA 409 or the Revised Charter of the City of Manila:

Section 18. Legislative powers. The [City Council] shall have the following legislative powers:

xxx xxx xxx


(g) To enact all ordinances it may deem necessary and proper for the sanitation and safety, the furtherance of the
prosperity, and the promotion of the morality, peace, good order, comfort, convenience, and general welfare of the city
and its inhabitants, and such others as may be necessary to carry into effect and discharge the powers and duties
conferred by this chapter xxxx[120]

Specifically, the Sanggunian has the power to reclassify land within the jurisdiction of the city.[121]

The Enactment Of Ordinance No. 8027 Is A Legitimate Exercise Of Police Power

As with the State, local governments may be considered as having properly exercised their police power only if the
following requisites are met: (1) the interests of the public generally, as distinguished from those of a particular class,
require its exercise and (2) the means employed are reasonably necessary for the accomplishment of the purpose and
not unduly oppressive upon individuals. In short, there must be a concurrence of a lawful subject and a lawful
method.[122]
Ordinance No. 8027 was enacted for the purpose of promoting sound urban planning, ensuring health, public safety and
general welfare[123] of the residents of Manila. The Sanggunian was impelled to take measures to protect the residents
of Manila from catastrophic devastation in case of a terrorist attack on the Pandacan Terminals. Towards this objective,
the Sanggunian reclassified the area defined in the ordinance from industrial to commercial.

The following facts were found by the Committee on Housing, Resettlement and Urban Development of the City of
Manila which recommended the approval of the ordinance:
(1) the depot facilities contained 313.5 million liters of highly flammable and highly volatile products which include
petroleum gas, liquefied petroleum gas, aviation fuel, diesel, gasoline, kerosene and fuel oil among others;
(2) the depot is open to attack through land, water or air;
(3) it is situated in a densely populated place and near Malacaang Palace and
(4) in case of an explosion or conflagration in the depot, the fire could spread to the neighboring communities.[124]

The ordinance was intended to safeguard the rights to life, security and safety of all the inhabitants of Manila and not
just of a particular class.[125] The depot is perceived, rightly or wrongly, as a representation of western interests which
means that it is a terrorist target. As long as it there is such a target in their midst, the residents of Manila are not safe. It
therefore became necessary to remove these terminals to dissipate the threat. According to respondent:

Such a public need became apparent after the 9/11 incident which showed that what was perceived to be impossible to
happen, to the most powerful country in the world at that, is actually possible. The destruction of property and the loss
of thousands of lives on that fateful day became the impetus for a public need. In the aftermath of the 9/11 tragedy, the
threats of terrorism continued [such] that it became imperative for governments to take measures to combat their
effects.[126]

Wide discretion is vested on the legislative authority to determine not only what the interests of the public require but
also what measures are necessary for the protection of such interests.[127] Clearly, the Sanggunian was in the best
position to determine the needs of its constituents.

In the exercise of police power, property rights of individuals may be subjected to restraints and burdens in order to
fulfill the objectives of the government.[128] Otherwise stated, the government may enact legislation that may interfere
with personal liberty, property, lawful businesses and occupations to promote the general welfare.[129] However, the
interference must be reasonable and not arbitrary. And to forestall arbitrariness, the methods or means used to
protect public health, morals, safety or welfare must have a reasonable relation to the end in view.[130]

The means adopted by the Sanggunian was the enactment of a zoning ordinance which reclassified the area where the
depot is situated from industrial to commercial. A zoning ordinance is defined as a local city or municipal legislation
which logically arranges, prescribes, defines and apportions a given political subdivision into specific land uses as present
and future projection of needs.[131] As a result of the zoning, the continued operation of the businesses of the oil
companies in their present location will no longer be permitted. The power to establish zones for industrial, commercial
and residential uses is derived from the police power itself and is exercised for the protection and benefit of the
residents of a locality.[132] Consequently, the enactment of Ordinance No. 8027 is within the power of the Sangguniang
Panlungsod of the City of Manila and any resulting burden on those affected cannot be said to be unjust:

There can be no doubt that the City of Manila has the power to divide its territory into residential and industrial zones,
and to prescribe that offensive and unwholesome trades and occupations are to be established exclusively in the latter
zone.

The benefits to be derived by cities adopting such regulations (zoning) may be summarized as follows: They attract a
desirable and assure a permanent citizenship; they foster pride in and attachment to the city; they promote happiness
and contentment; they stabilize the use and value of property and promote the peace, [tranquility], and good order of
the city. We do not hesitate to say that the attainment of these objects affords a legitimate field for the exercise of the
police power. He who owns property in such a district is not deprived of its use by such regulations. He may use it for the
purposes to which the section in which it is located is dedicated. That he shall not be permitted to use it to the
desecration of the community constitutes no unreasonable or permanent hardship and results in no unjust burden.

Xxx xxx xxx


The 14th Amendment protects the citizen in his right to engage in any lawful business, but it does not prevent legislation
intended to regulate useful occupations which, because of their nature or location, may prove injurious or offensive to
the public.[133]

We entertain no doubt that Ordinance No. 8027 is a valid police power measure because there is a concurrence of
lawful subject and lawful method.

Ordinance No. 8027 Is Not Unfair, Oppressive Or Confiscatory Which Amounts To Taking Without Compensation

According to the oil companies, Ordinance No. 8027 is unfair and oppressive as it does not only regulate but also
absolutely prohibits them from conducting operations in the City of Manila. Respondent counters that this is not
accurate since the ordinance merely prohibits the oil companies from operating their businesses in the Pandacan area.

Indeed, the ordinance expressly delineated in its title and in Section 1 what it pertained to. Therefore, the oil companies
contention is not supported by the text of the ordinance. Respondent succinctly stated that:

The oil companies are not forbidden to do business in the City of Manila. They may still very well do so, except that their
oil storage facilities are no longer allowed in the Pandacan area. Certainly, there are other places in the City of Manila
where they can conduct this specific kind of business. Ordinance No. 8027 did not render the oil companies illegal. The
assailed ordinance affects the oil companies business only in so far as the Pandacan area is concerned.[134]

The oil companies are not prohibited from doing business in other appropriate zones in Manila. The City of Manila
merely exercised its power to regulate the businesses and industries in the zones it established:

As to the contention that the power to regulate does not include the power to prohibit, it will be seen that the
ordinance copied above does not prohibit the installation of motor engines within the municipality of Cabanatuan but
only within the zone therein fixed. If the municipal council of Cabanatuan is authorized to establish said zone, it is also
authorized to provide what kind of engines may be installed therein. In banning the installation in said zone of all
engines not excepted in the ordinance, the municipal council of Cabanatuan did no more than regulate their installation
by means of zonification.[135]

The oil companies aver that the ordinance is unfair and oppressive because they have invested billions of pesos in the
depot.[136] Its forced closure will result in huge losses in income and tremendous costs in constructing new facilities.

Their contention has no merit. In the exercise of police power, there is a limitation on or restriction of property interests
to promote public welfare which involves no compensable taking. Compensation is necessary only when the states
power of eminent domain is exercised. In eminent domain, property is appropriated and applied to some public
purpose. Property condemned under the exercise of police power, on the other hand, is noxious or intended for a
noxious or forbidden purpose and, consequently, is not compensable.[137]The restriction imposed to protect lives,
public health and safety from danger is not a taking. It is merely the prohibition or abatement of a noxious use which
interferes with paramount rights of the public.
Property has not only an individual function, insofar as it has to provide for the needs of the owner, but also a social
function insofar as it has to provide for the needs of the other members of society.[138] The principle is this:

Police power proceeds from the principle that every holder of property, however absolute and unqualified may be his
title, holds it under the implied liability that his use of it shall not be injurious to the equal enjoyment of others having an
equal right to the enjoyment of their property, nor injurious to the right of the community. Rights of property, like all
other social and conventional rights, are subject to reasonable limitations in their enjoyment as shall prevent them from
being injurious, and to such reasonable restraints and regulations established by law as the legislature, under the
governing and controlling power vested in them by the constitution, may think necessary and expedient.[139]

In the regulation of the use of the property, nobody else acquires the use or interest therein, hence there is no
compensable taking.[140]In this case, the properties of the oil companies and other businesses situated in the affected
area remain theirs. Only their use is restricted although they can be applied to other profitable uses permitted in the
commercial zone.

Ordinance No. 8027 Is Not


Partial And Discriminatory

The oil companies take the position that the ordinance has discriminated against and singled out the Pandacan
Terminals despite the fact that the Pandacan area is congested with buildings and residences that do not comply with
the National Building Code, Fire Code and Health and Sanitation Code.[141]

This issue should not detain us for long. An ordinance based on reasonable classification does not violate the
constitutional guaranty of the equal protection of the law.[142] The requirements for a valid and reasonable
classification are: (1) it must rest on substantial distinctions; (2) it must be germane to the purpose of the law; (3) it must
not be limited to existing conditions only and (4) it must apply equally to all members of the same class.[143]

The law may treat and regulate one class differently from another class provided there are real and substantial
differences to distinguish one class from another.[144] Here, there is a reasonable classification. We reiterate that what
the ordinance seeks to prevent is a catastrophic devastation that will result from a terrorist attack. Unlike the depot, the
surrounding community is not a high-value terrorist target. Any damage caused by fire or explosion occurring in those
areas would be nothing compared to the damage caused by a fire or explosion in the depot itself. Accordingly, there is a
substantial distinction. The enactment of the ordinance which provides for the cessation of the operations of these
terminals removes the threat they pose. Therefore it is germane to the purpose of the ordinance. The classification is
not limited to the conditions existing when the ordinance was enacted but to future conditions as well. Finally, the
ordinance is applicable to all businesses and industries in the area it delineated.
Ordinance No. 8027 is Not Inconsistent With RA 7638 And RA 8479

The oil companies and the DOE assert that Ordinance No. 8027 is unconstitutional because it contravenes RA 7638 (DOE
Act of 1992)[145] and RA 8479 (Downstream Oil Industry Deregulation Law of 1998).[146] They argue that through RA
7638, the national legislature declared it a policy of the state to ensure a continuous, adequate, and economic supply of
energy[147] and created the DOE to implement this policy. Thus, under Section 5 I, DOE is empowered to establish and
administer programs for the exploration, transportation, marketing, distribution, utilization, conservation, stockpiling,
and storage of energy resources. Considering that the petroleum products contained in the Pandacan Terminals are
major and critical energy resources, they conclude that their administration, storage, distribution and transport are of
national interest and fall under DOEs primary and exclusive jurisdiction.[148]
They further assert that the terminals are necessary for the delivery of immediate and adequate supply of oil to its
recipients in the most economical way.[149] Local legislation such as Ordinance No. 8027 (which effectively calls for the
removal of these terminals) allegedly frustrates the state policy of ensuring a continuous, adequate, and economic
supply of energy expressed in RA 7638, a national law.[150] Likewise, the ordinance thwarts the determination of the
DOE that the terminals operations should be merely scaled down and not discontinued.[151] They insist that this should
not be allowed considering that it has a nationwide economic impact and affects public interest transcending the
territorial jurisdiction of the City of Manila.[152]

According to them, the DOEs supervision over the oil industry under RA 7638 was subsequently underscored by RA
8479, particularly in Section 7 thereof:

SECTION 7. Promotion of Fair Trade Practices. ― The Department of Trade and Industry (DTI) and DOE shall take all
measures to promote fair trade and prevent cartelization, monopolies, combinations in restraint of trade, and any unfair
competition in the Industry as defined in Article 186 of the Revised Penal Code, and Articles 168 and 169 of Republic Act
No. 8293, otherwise known as the Intellectual Property Rights Law. The DOE shall continue to encourage certain
practices in the Industry which serve the public interest and are intended to achieve efficiency and cost reduction,
ensure continuous supply of petroleum products, and enhance environmental protection. These practices may include
borrow-and-loan agreements, rationalized depot and manufacturing operations, hospitality agreements, joint tanker
and pipeline utilization, and joint actions on oil spill control and fire prevention. (Emphasis supplied)
Respondent counters that DOEs regulatory power does not preclude LGUs from exercising their police power.[153]
Indeed, ordinances should not contravene existing statutes enacted by Congress. The rationale for this was clearly
explained in Magtajas vs. Pryce Properties Corp., Inc.:[154]

The rationale of the requirement that the ordinances should not contravene a statute is obvious. Municipal
governments are only agents of the national government. Local councils exercise only delegated legislative powers
conferred on them by Congress as the national lawmaking body. The delegate cannot be superior to the principal or
exercise powers higher than those of the latter. It is a heresy to suggest that the local government units can undo the
acts of Congress, from which they have derived their power in the first place, and negate by mere ordinance the
mandate of the statute.

Municipal corporations owe their origin to, and derive their powers and rights wholly from the legislature. It breathes
into them the breath of life, without which they cannot exist. As it creates, so it may destroy. As it may destroy, it may
abridge and control. Unless there is some constitutional limitation on the right, the legislature might, by a single act, and
if we can suppose it capable of so great a folly and so great a wrong, sweep from existence all of the municipal
corporations in the State, and the corporation could not prevent it. We know of no limitation on the right so far as to the
corporation themselves are concerned. They are, so to phrase it, the mere tenants at will of the legislature.

This basic relationship between the national legislature and the local government units has not been enfeebled by the
new provisions in the Constitution strengthening the policy of local autonomy. Without meaning to detract from that
policy, we here confirm that Congress retains control of the local government units although in significantly reduced
degree now than under our previous Constitutions. The power to create still includes the power to destroy. The power
to grant still includes the power to withhold or recall. True, there are certain notable innovations in the Constitution, like
the direct conferment on the local government units of the power to tax, which cannot now be withdrawn by mere
statute. By and large, however, the national legislature is still the principal of the local government units, which cannot
defy its will or modify or violate it.[155]

The question now is whether Ordinance No. 8027 contravenes RA 7638 and RA 8479. It does not.

Under Section 5 I of RA 7638, DOE was given the power to establish and administer programs for the exploration,
transportation, marketing, distribution, utilization, conservation, stockpiling, and storage of energy resources. On the
other hand, under Section 7 of RA 8749, the DOE shall continue to encourage certain practices in the Industry which
serve the public interest and are intended to achieve efficiency and cost reduction, ensure continuous supply of
petroleum products. Nothing in these statutes prohibits the City of Manila from enacting ordinances in the exercise of its
police power.
The principle of local autonomy is enshrined in and zealously protected under the Constitution. In Article II, Section 25
thereof, the people expressly adopted the following policy:

Section 25. The State shall ensure the autonomy of local governments.

An entire article (Article X) of the Constitution has been devoted to guaranteeing and promoting the autonomy of
LGUs. The LGC was specially promulgated by Congress to ensure the autonomy of local governments as mandated by
the Constitution:
Sec. 2. Declaration of Policy. ― (a) It is hereby declared the policy of the State that the territorial and political
subdivisions of the State shall enjoy genuine and meaningful local autonomy to enable them to attain their fullest
development as self-reliant communities and make them more effective partners in the attainment of national
goals. Toward this end, the State shall provide for a more responsive and accountable local government structure
instituted through a system of decentralization whereby local government units shall be given more powers, authority,
responsibilities, and resources. The process of decentralization shall proceed from the National Government to the local
government units. (Emphasis supplied)

We do not see how the laws relied upon by the oil companies and DOE stripped the City of Manila of its power to enact
ordinances in the exercise of its police power and to reclassify the land uses within its jurisdiction. To guide us, we shall
make a brief survey of our decisions where the police power measure of the LGU clashed with national laws.
In Tan v. Perea,[156] the Court ruled that Ordinance No. 7 enacted by the municipality of Daanbantayan, Cebu allowing
the operation of three cockpits was invalid for violating PD 449 (or the Cockfighting Law of 1974) which permitted only
one cockpit per municipality.

In Batangas CATV, Inc. v. Court of Appeals,[157] the Sangguniang Panlungsod of Batangas City enacted Resolution No.
210 grantingBatangas CATV, Inc. a permit to operate a cable television (CATV) system in Batangas City. The Court held
that the LGU did not have the authority to grant franchises to operate a CATV system because it was the National
Telecommunications Commission (NTC) that had the power under EO Nos. 205 and 436 to regulate CATV operations. EO
205 mandated the NTC to grant certificates of authority to CATV operators while EO 436 vested on the NTC the power to
regulate and supervise the CATV industry.

In Lina, Jr. v. Pao,[158] we held that Kapasiyahan Bilang 508, Taon 1995 of the Sangguniang Panlalawigan of Laguna
could not be used as justification to prohibit lotto in the municipality of San Pedro, Laguna because lotto was duly
authorized by RA 1169, as amended by BP 42. This law granted a franchise to the Philippine Charity Sweepstakes Office
and allowed it to operate lotteries.

In Magtajas v. Pryce Properties Corp., Inc.,[159] the Sangguniang Panlungsod of Cagayan de Oro City passed Ordinance
Nos. 3353 and 3375-93 prohibiting the operation of casinos in the city. We ruled that these ordinances were void for
contravening PD 1869 or the charter of the Philippine Amusements and Gaming Corporation which had the power to
operate casinos.

The common dominator of all of these cases is that the national laws were clearly and expressly in conflict with the
ordinances/resolutions of the LGUs. The inconsistencies were so patent that there was no room for doubt. This is not
the case here.

The laws cited merely gave DOE general powers to establish and administer programs for the exploration,
transportation, marketing, distribution, utilization, conservation, stockpiling, and storage of energy resources and to
encourage certain practices in the [oil] industry which serve the public interest and are intended to achieve efficiency
and cost reduction, ensure continuous supply of petroleum products. These powers can be exercised without
emasculating the LGUs of the powers granted them. When these ambiguous powers are pitted against the unequivocal
power of the LGU to enact police power and zoning ordinances for the general welfare of its constituents, it is not
difficult to rule in favor of the latter. Considering that the powers of the DOE regarding the Pandacan Terminals are not
categorical, the doubt must be resolved in favor of the City of Manila:

SECTION 5. Rules of Interpretation. ― In the interpretation of the provisions of this Code, the following rules shall apply:

(a) Any provision on a power of a local government unit shall be liberally interpreted in its favor, and in case of doubt,
any question thereon shall be resolved in favor of devolution of powers and of the lower local government unit. Any fair
and reasonable doubt as to the existence of the power shall be interpreted in favor of the local government unit
concerned;

xxx xxx xxx


(g) IThe general welfare provisions in this Code shall be liberally interpreted to give more powers to local government
units in accelerating economic development and upgrading the quality of life for the people in the community xxxx

The least we can do to ensure genuine and meaningful local autonomy is not to force an interpretation that negates
powers explicitly granted to local governments. To rule against the power of LGUs to reclassify areas within their
jurisdiction will subvert the principle of local autonomy guaranteed by the Constitution.[160] As we have noted in earlier
decisions, our national officials should not only comply with the constitutional provisions on local autonomy but should
also appreciate the spirit and liberty upon which these provisions are based.[161]

The DOE Cannot Exercise The Power Of Control Over LGUs

Another reason that militates against the DOEs assertions is that Section 4 of Article X of the Constitution confines the
Presidents power over LGUs to one of general supervision:

SECTION 4. The President of the Philippines shall exercise general supervision over local governments. Xxxx

Consequently, the Chief Executive or his or her alter egos, cannot exercise the power of control over them.[162] Control
and supervision are distinguished as follows:

[Supervision] means overseeing or the power or authority of an officer to see that subordinate officers perform their
duties. If the latter fail or neglect to fulfill them, the former may take such action or step as prescribed by law to make
them perform their duties. Control, on the other hand, means the power of an officer to alter or modify or nullify or set
aside what a subordinate officer ha[s] done in the performance of his duties and to substitute the judgment of the
former for that of the latter.[163]
Supervisory power, when contrasted with control, is the power of mere oversight over an inferior body; it does not
include any restraining authority over such body.[164] It does not allow the supervisor to annul the acts of the
subordinate.[165] Here, what the DOE seeks to do is to set aside an ordinance enacted by local officials, a power that
not even its principal, the President, has. This is because:
Under our present system of government, executive power is vested in the President. The members of the Cabinet and
other executive officials are merely alter egos. As such, they are subject to the power of control of the President, at
whose will and behest they can be removed from office; or their actions and decisions changed, suspended or
reversed. In contrast, the heads of political subdivisions are elected by the people. Their sovereign powers emanate
from the electorate, to whom they are directly accountable. By constitutional fiat, they are subject to the Presidents
supervision only, not control, so long as their acts are exercised within the sphere of their legitimate powers. By the
same token, the President may not withhold or alter any authority or power given them by the Constitution and the
law.[166]
Thus, the President and his or her alter egos, the department heads, cannot interfere with the activities of local
governments, so long as they act within the scope of their authority. Accordingly, the DOE cannot substitute its own
discretion for the discretion exercised by the sanggunian of the City of Manila. In local affairs, the wisdom of local
officials must prevail as long as they are acting within the parameters of the Constitution and the law.[167]

Ordinance No. 8027 Is Not Invalid For Failure To Comply With RA 7924 And EO 72
The oil companies argue that zoning ordinances of LGUs are required to be submitted to the Metropolitan Manila
Development Authority (MMDA) for review and if found to be in compliance with its metropolitan physical framework
plan and regulations, it shall endorse the same to the Housing and Land Use Regulatory Board (HLURB). Their basis is
Section 3 (e) of RA 7924:[168]

SECTION 3. Scope of MMDA Services. ― Metro-wide services under the jurisdiction of the MMDA are those services
which have metro-wide impact and transcend local political boundaries or entail huge expenditures such that it would
not be viable for said services to be provided by the individual [LGUs] comprising Metropolitan Manila. These services
shall include:

xxx xxx xxx

(g) Urban renewal, zoning, and land use planning, and shelter services which include the formulation, adoption
and implementation of policies, standards, rules and regulations, programs and projects to rationalize and optimize
urban land use and provide direction to urban growth and expansion, the rehabilitation and development of slum and
blighted areas, the development of shelter and housing facilities and the provision of necessary social services
thereof. (Emphasis supplied)
Reference was also made to Section 15 of its implementing rules:
Section 15. Linkages with HUDCC, HLURB, NHA, LGUs and Other National Government Agencies Concerned on Urban
Renewal, Zoning and Land Use Planning and Shelter Services. Within the context of the National Housing and Urban
Development Framework, and pursuant to the national standards, guidelines and regulations formulated by the Housing
and Land Use Regulatory Board [HLURB] on land use planning and zoning, the [MMDA] shall prepare a metropolitan
physical framework plan and regulations which shall complement and translate the socio-economic development plan
for Metro Manila into physical or spatial terms, and provide the basis for the preparation, review, integration and
implementation of local land use plans and zoning, ordinance of cities and municipalities in the area.

Said framework plan and regulations shall contain, among others, planning and zoning policies and procedures that shall
be observed by local government units in the preparation of their own plans and ordinances pursuant to Section 447
and 458 of RA 7160, as well as the identification of sites and projects that are considered to be of national or
metropolitan significance.

Cities and municipalities shall prepare their respective land use plans and zoning ordinances and submit the same for
review and integration by the [MMDA] and indorsement to HLURB in accordance with Executive Order No. 72 and other
pertinent laws.

In the preparation of a Metropolitan Manila physical framework plan and regulations, the [MMDA] shall coordinate with
the Housing and Urban Development Coordinating Council, HLURB, the National Housing Authority, Intramuros
Administration, and all other agencies of the national government which are concerned with land use and zoning, urban
renewal and shelter services. (Emphasis supplied)

They also claim that EO 72[169] provides that zoning ordinances of cities and municipalities of Metro Manila are subject
to review by the HLURB to ensure compliance with national standards and guidelines. They cite Section 1, paragraphs I,
(e), (f) and (g):
SECTION 1. Plan formulation or updating. ―

xxx xxx xxx

(g) Cities and municipalities of Metropolitan Manila shall continue to formulate or update their
respective comprehensive land use plans, in accordance with the land use planning and zoning standards and guidelines
prescribed by the HLURB pursuant to EO 392, S. of 1990, and other pertinent national policies.

Xxx xxx xxx


(e) Pursuant to LOI 729, S. of 1978, EO 648, S. of 1981, and RA 7279, the comprehensive land use plans of provinces,
highly urbanized cities and independent component cities shall be reviewed and ratified by the HLURB to ensure
compliance with national standards and guidelines.

(f) Pursuant to EO 392, S. of 1999, the comprehensive land use plans of cities and municipalities of Metropolitan Manila
shall be reviewed by the HLURB to ensure compliance with national standards and guidelines.

(g) Said review shall be completed within three (3) months upon receipt thereof otherwise, the same shall be deemed
consistent with law, and, therefore, valid. (Emphasis supplied)

They argue that because Ordinance No. 8027 did not go through this review process, it is invalid.

The argument is flawed.

RA 7942 does not give MMDA the authority to review land use plans and zoning ordinances of cities and
municipalities. This was only found in its implementing rules which made a reference to EO 72. EO 72 expressly refers to
comprehensive land use plans (CLUPs) only. Ordinance No. 8027 is admittedly not a CLUP nor intended to be
one. Instead, it is a very specific ordinance which reclassified the land use of a defined area in order to prevent the
massive effects of a possible terrorist attack. It is Ordinance No. 8119 which was explicitly formulated as the Manila
[CLUP] and Zoning Ordinance of 2006. CLUPs are the ordinances which should be submitted to the MMDA for
integration in its metropolitan physical framework plan and approved by the HLURB to ensure that they conform with
national guidelines and policies.

Moreover, even assuming that the MMDA review and HLURB ratification are necessary, the oil companies did not
present any evidence to show that these were not complied with. In accordance with the presumption of validity in
favor of an ordinance, its constitutionality or legality should be upheld in the absence of proof showing that the
procedure prescribed by law was not observed. The burden of proof is on the oil companies which already had notice
that this Court was inclined to dispose of all the issues in this case. Yet aside from their bare assertion, they did not
present any certification from the MMDA or the HLURB nor did they append these to their pleadings. Clearly, they failed
to rebut the presumption of validity of Ordinance No. 8027.[170]

Conclusion

Essentially, the oil companies are fighting for their right to property. They allege that they stand to lose billions of pesos
if forced to relocate. However, based on the hierarchy of constitutionally protected rights, the right to life enjoys
precedence over the right to property.[171] The reason is obvious: life is irreplaceable, property is not. When the state
or LGUs exercise of police power clashes with a few individuals right to property, the former should prevail.[172]

Both law and jurisprudence support the constitutionality and validity of Ordinance No. 8027. Without a doubt, there are
no impediments to its enforcement and implementation. Any delay is unfair to the inhabitants of the City of Manila and
its leaders who have categorically expressed their desire for the relocation of the terminals. Their power to chart and
control their own destiny and preserve their lives and safety should not be curtailed by the intervenors warnings of
doomsday scenarios and threats of economic disorder if the ordinance is enforced.

Secondary to the legal reasons supporting the immediate implementation of Ordinance No. 8027 are the policy
considerations which drove Manilas government to come up with such a measure:

... [The] oil companies still were not able to allay the apprehensions of the city regarding the security threat in the area
in general. No specific action plan or security measures were presented that would prevent a possible large-scale
terrorist or malicious attack especially an attack aimed at Malacaang. The measures that were installed were more
directed towards their internal security and did not include the prevention of an external attack even on a bilateral level
of cooperation between these companies and the police and military.
Xxx xxx xxx
It is not enough for the city government to be told by these oil companies that they have the most sophisticated fire-
fighting equipments and have invested millions of pesos for these equipments. The city government wants to be assured
that its residents are safe at any time from these installations, and in the three public hearings and in their position
papers, not one statement has been said that indeed the absolute safety of the residents from the hazards posed by
these installations is assured.[173]

We are also putting an end to the oil companies determination to prolong their stay in Pandacan despite the objections
of Manilas residents. As early as October 2001, the oil companies signed a MOA with the DOE obliging themselves to:
... undertake a comprehensive and comparative study ... [which] shall include the preparation of a Master Plan, whose
aim is to determine the scope and timing of the feasible location of the Pandacan oil terminals and all associated
facilities and infrastructure including government support essential for the relocation such as the necessary
transportation infrastructure, land and right of way acquisition, resettlement of displaced residents and environmental
and social acceptability which shall be based on mutual benefit of the Parties and the public.[174]

Now that they are being compelled to discontinue their operations in the Pandacan Terminals, they cannot feign
unreadiness considering that they had years to prepare for this eventuality.

Just the same, this Court is not about to provoke a crisis by ordering the immediate relocation of the Pandacan
Terminals out of its present site. The enforcement of a decision of this Court, specially one with far-reaching
consequences, should always be within the bounds of reason, in accordance with a comprehensive and well-coordinated
plan, and within a time-frame that complies with the letter and spirit of our resolution. To this end, the oil companies
have no choice but to obey the law.

A Warning To Petitioners Counsel

We draw the attention of the parties to a matter of grave concern to the legal profession.

Petitioners and their counsel, Atty. Samson Alcantara, submitted a four-page memorandum that clearly contained either
substance nor research. It is absolutely insulting to this Court.

We have always tended towards judicial leniency, temperance and compassion to those who suffer from a wrong
perception of what the majesty of the law means. But for a member of the bar, an officer of the court, to file in this
Court a memorandum of such unacceptable quality is an entirely different matter.

It is indicative less of a personal shortcoming or contempt of this Court and more of a lawyers sorry descent from a high
sense of duty and responsibility. As a member of the bar and as an officer of the court, a lawyer ought to be keenly
aware that the chief safeguard of the body politic is respect for the law and its magistrates.

There is nothing more effective than the written word by which counsel can persuade this Court of the righteousness of
his cause.For if truth were self-evident, a memorandum would be completely unnecessary and superfluous.

The inability of counsel to prepare a memorandum worthy of this Courts consideration is an ejemplo malo to the legal
profession as it betrays no genuine interest in the cause he claims to espouse. Or did counsel think he can earn his
moment of glory without the hard work and dedication called for by his petition?
A Final Word

On Wednesday, January 23, 2008, a defective tanker containing 2,000 liters of gasoline and 14,000 liters of diesel
exploded in the middle of the street a short distance from the exit gate of the Pandacan Terminals, causing death,
extensive damage and a frightening conflagration in the vicinity of the incident. Need we say anthing about what will
happen if it is the estimated 162 to 211 million liters[175] of petroleum products in the terminal complex which blow
up?
WHEREFORE, the motions for leave to intervene of Chevron Philippines Inc., Petron Corporation and Pilipinas Shell
Petroleum Corporation, and the Republic of the Philippines, represented by the Department of Energy, are
hereby GRANTED. Their respective motions for reconsideration are hereby DENIED. The Regional Trial Court, Manila,
Branch 39 is ORDERED to DISMISS the consolidated cases of Civil Case No. 03-106377 and Civil Case No. 03-106380.

We reiterate our order to respondent Mayor of the City of Manila to enforce Ordinance No. 8027. In coordination with
the appropriate agencies and other parties involved, respondent Mayor is hereby ordered to oversee the relocation and
transfer of the Pandacan Terminals out of its present site.

To ensure the orderly transfer, movement and relocation of assets and personnel, the intervenors Chevron Philippines
Inc., Petron Corporation and Pilipinas Shell Petroleum Corporation shall, within a non-extendible period of ninety (90)
days, submit to the Regional Trial Court of Manila, Branch 39, the comprehensive plan and relocation schedule which
have allegedly been prepared. The presiding judge of Manila RTC, Branch 39 will monitor the strict enforcement of this
resolution.

Atty. Samson Alcantara is hereby ordered to explain within five (5) days from notice why he should not be disciplined for
his refusal, or inability, to file a memorandum worthy of the consideration of this Court.
Treble costs against petitioners counsel, Atty. Samson Alcantara.

SO ORDERED.

Sgd.
RENATO C. CORONA
Associate Justice
[G.R. No. 135087. March 14, 2000]
HEIRS OF ALBERTO SUGUITAN, petitioner, vs. CITY OF MANDALUYONG, respondent. frnaics
DECISION
GONZAGA_REYES, J.:
In this petition for review on certiorari under Rule 45, petitioners[1] pray for the reversal of the Order dated July 28,
1998 issued by Branch 155 of the Regional Trial Court of Pasig in SCA No. 875 entitled "City of Mandaluyong v. Alberto S.
Suguitan, the dispositive portion of which reads as follows:
WHEREFORE, in view of the foregoing, the instant Motion to Dismiss is hereby DENIED and an ORDER OF
CONDEMNATION is hereby issued declaring that the plaintiff, City of Mandaluyong, has a lawful right to take the subject
parcel of land together with existing improvements thereon more specifically covered by Transfer Certificate Of Title No.
56264 of the Registry of Deeds for Metro Manila District II for the public use or purpose as stated in the Complaint, upon
payment of just compensation.
Accordingly, in order to ascertain the just compensation, the parties are hereby directed to submit to the Court within
fifteen (15) days from notice hereof, a list of independent appraisers from which the Court t will select three (3) to be
appointed as Commissioners, pursuant to Section 5, Rule 67, Rules of Court.
SO ORDERED.[2]ella
It is undisputed by the parties that on October 13, 1994, the Sangguniang Panlungsod of Mandaluyong City issued
Resolution No. 396, S-1994[3] authorizing then Mayor Benjamin S. Abalos to institute expropriation proceedings over
the property of Alberto Sugui located at Boni Avenue and Sto. Rosario streets in Mandaluyong City with an area of 414
square meters and more particularly described under Transfer Certificate of Title No. 56264 of the Registry of Deeds of
Metro Manila District II. The intended purpose of the expropriation was the expansion of the Mandaluyong Medical
Center.
Mayor Benjamin Abalos wrote Alberto Suguitan a letter dated January 20, 1995 offering to buy his property, but
Suguitan refused to sell.[4] Consequently, on March 13, 1995, the city of Mandaluyong filed a complaint[5] for
expropriation with the Regional Trial Court of Pasig. The case was docketed as SCA No. 875. novero
Suguitan filed a motion to dismiss[6] the complaint based on the following grounds -(1) the power of eminent domain is
not being exercised in accordance with law; (2) there is no public necessity to warrant expropriation of subject property;
(3) the City of Mandaluyong seeks to expropriate the said property without payment of just compensation; (4) the City
of Mandaluyong has no budget and appropriation for the payment of the property being expropriated; and (5)
expropriation of Suguitan' s property is but a ploy of Mayor Benjamin Abalos to acquire the same for his personal use.
Respondent filed its comment and opposition to the motion. On October 24, 1995, the trial court denied Suguitan's
motion to dismiss.[7]
On November 14, 1995, acting upon a motion filed by the respondent, the trial court issued an order allowing the City of
Mandaluyong to take immediate possession of Suguitan's property upon the deposit of P621,000 representing 15% of
the fair market value of the subject property based upon the current tax declaration of such property. On December 15,
1995, the City of Mandaluyong assumed possession of the subject property by virtue of a writ of possession issued by
the trial court on December 14, 1995.[8] On July 28, 1998, the court granted the assailed order of expropriation.
Petitioner assert that the city of Mandaluyong may only exercise its delegated power of eminent domain by means of an
ordinance as required by section 19 of Republic Act (RA) No. 7160,[9] and not by means of a mere
resolution.[10] Respondent contends, however, that it validly and legally exercised its power of eminent domain; that
pursuant to article 36, Rule VI of the Implementing Rules and Regulations (IRR) of RA 7160, a resolution is a sufficient
antecedent for the filing of expropriation proceedings with the Regional Trial Court. Respondent's position, which was
upheld by the trial court, was explained, thus:[11]
...in the exercise of the respondent City of Mandaluyong's power of eminent domain, a "resolution" empowering the
City Mayor to initiate such expropriation proceedings and thereafter when the court has already determine[d] with
certainty the amount of just compensation to be paid for the property expropriated, then follows an Ordinance of the
Sanggunian Panlungosd appropriating funds for the payment of the expropriated property. Admittedly, title to the
property expropriated shall pass from the owner to the expropriator only upon full payment of the just
compensation.[12] novero
Petitioners refute respondent's contention that only a resolution is necessary upon the initiation of expropriation
proceedings and that an ordinance is required only in order to appropriate the funds for the payment of just
compensation, explaining that the resolution mentioned in article 36 of the IRR is for purposes of granting
administrative authority to the local chief executive to file the expropriation case in court and to represent the local
government unit in such case, but does not dispense with the necessity of an ordinance for the exercise of the power of
eminent domain under section 19 of the Code.[13]
The petition is imbued with merit.
Eminent domain is the right or power of a sovereign state to appropriate private property to particular uses to promote
public welfare.[14] It is an indispensable attribute of sovereignty; a power grounded in the primary duty of government
to serve the common need and advance the general welfare.[15] Thus, the right of eminent domain appertains to every
independent government without the necessity for constitutional recognition.[16] The provisions found in modern
constitutions of civilized countries relating to the taking of property for the public use do not by implication grant the
power to the government, but limit a power which would otherwise be without limit.[17] Thus, our own Constitution
provides that "[p]rivate property shall not be taken for public use without just compensation."[18] Furthermore, the due
process and equal protection clauses[19] act as additional safeguards against the arbitrary exercise of this governmental
power.
Since the exercise of the power of eminent domain affects an individual's right to private property, a constitutionally-
protected right necessary for the preservation and enhancement of personal dignity and intimately connected with the
rights to life and liberty,[20] the need for its circumspect operation cannot be overemphasized. In City of Manila vs.
Chinese Community of Manila we said:[21]
The exercise of the right of eminent domain, whether directly by the State, or by its authorized agents, is necessarily in
derogation of private rights, and the rule in that case is that the authority must be strictly construed. No species of
property is held by individuals with greater tenacity, and none is guarded by the constitution and the laws more
sedulously, than the right to the freehold of inhabitants. When the legislature interferes with that right, and, for greater
public purposes, appropriates the land of an individual without his consent, the plain meaning of the law should not be
enlarged by doubt[ful] interpretation. (Bensley vs. Mountainlake Water Co., 13 Cal., 306 and cases cited [73 Am. Dec.
576].)
The statutory power of taking property from the owner without his consent is one of the most delicate exercise of
governmental authority. It is to be watched with jealous scrutiny. Important as the power may be to the government,
the inviolable sanctity which all free constitutions attach to the right of property of the citizens, constrains the strict
observance of the substantial provisions of the law which are prescribed as modes of the exercise of the power, and to
protect it from abuse. ...(Dillon on Municipal Corporations [5th Ed.], sec. 1040, and cases cited; Tenorio vs. Manila
Railroad Co., 22 Phil., 411.)
The power of eminent domain is essentially legislative in nature. It is firmly settled, however, that such power may be
validly delegated to local government units, other public entities and public utilities, although the scope of this
delegated legislative power is necessarily narrower than that of the delegating authority and may only be exercised in
strict compliance with the terms of the delegating law.[22] micks
The basis for the exercise of the power of eminent domain by local government units is section 19 of RA 7160 which
provides that:
A local government unit may, through its chief executive and acting pursuant to an ordinance, exercise the power of
eminent domain for public use, purpose, or welfare for the benefits of the poor and the landless, upon payment of just
compensation, pursuant to the provisions of the Constitution and pertinent laws; Provided, however, That the power of
eminent domain may not be exercised unless a valid and definite offer has been previously made to the owner, and such
offer was not accepted; Provided, further, That the local government unit may immediately take possession of the
property upon the filing of the expropriation proceedings and upon making a deposit with the proper court of at least
fifteen percent (15%) of the fair market value of the property based on the current tax declaration of the property to be
expropriated; Provided, finally, That the amount to be paid for the expropriated property shall be determined by the
proper court, based on the fair market value at the time of the taking of the property.
Despite the existence of this legislative grant in favor of local governments, it is still the duty of the courts to determine
whether the power of eminent domain is being exercised in accordance with the delegating law.[23] In fact, the courts
have adopted a more censorious attitude in resolving questions involving the proper exercise of this delegated power by
local bodies, as compared to instances when it is directly exercised by the national legislature.[24]
The courts have the obligation to determine whether the following requisites have been complied with by the local
government unit concerned:
1. An ordinance is enacted by the local legislative council authorizing the local chief executive, in behalf of the local
government unit, to exercise the power of eminent domain or pursue expropriation proceedings over a particular
private property .calr
2. The power of eminent domain is exercised for public use, purpose or welfare, or for the benefit of the poor and the
landless.
3. There is payment of just compensation, as required under Section 9, Article III of the Constitution, and other pertinent
laws.
4. A valid and definite offer has been previously made to the owner of the property sought to be expropriated, but said
offer was not accepted.[25]
In the present case, the City of Mandaluyong seeks to exercise the power of eminent domain over petitioners' property
by means of a resolution, in contravention of the first requisite. The law in this case is clear and free from ambiguity.
Section 19 of the Code requires an ordinance, not a resolution, for the exercise of the power of eminent domain. We
reiterate our ruling in Municipality of Paraaque v. V.M. Realty Corporation[26] regarding the distinction between an
ordinance and a resolution. In that 1998 case we held that:miso
We are not convinced by petitioner's insistence that the terms "resolution" and "ordinance" are synonymous. A
municipal ordinance is different from a resolution. An ordinance is a law, but a resolution is merely a declaration of the
sentiment or opinion of a lawmaking body on a specific matter. An ordinance possesses a general and permanent
character, but a resolution is temporary in nature. Additionally, the two are enacted differently -a third reading is
necessary for an ordinance, but not for a resolution, unless decided otherwise by a majority of all
the Sanggunian members.
We cannot uphold respondent's contention that an ordinance is needed only to appropriate funds after the court has
determined the amount of just compensation. An examination of the applicable law will show that an ordinance is
necessary to authorize the filing of a complaint with the proper court since, beginning at this point, the power of
eminent domain is already being exercised.
Rule 67 of the 1997 Revised Rules of Court reveals that expropriation proceedings are comprised of two stages:
(1) the first is concerned with the determination of the authority of the plaintiff to exercise the power of eminent
domain and the propriety of its exercise in the context of the facts involved in the suit; it ends with an order, if not in a
dismissal of the action, of condemnation declaring that the plaintiff has a lawful right to take the property sought to be
condemned, for the public use or purpose described in the complaint, upon the payment of just compensation to be
determined as of the date of the filing of the complaint;
(2) the second phase is concerned with the determination by the court of the just compensation for the property sought
to be taken; this is done by the court with the assistance of not more than three (3) commissioners.[27]
Clearly, although the determination and award of just compensation to the defendant is indispensable to the transfer of
ownership in favor of the plaintiff, it is but the last stage of the expropriation proceedings, which cannot be arrived at
without an initial finding by the court that the plaintiff has a lawful right to take the property sought to be expropriated,
for the public use or purpose described in the complaint. An order of condemnation or dismissal at this stage would be
final, resolving the question of whether or not the plaintiff has properly and legally exercised its power of eminent
domain.
Also, it is noted that as soon as the complaint is filed the plaintiff shall already have the right to enter upon the
possession of the real property involved upon depositing with the court at least fifteen percent (15%) of the fair market
value of the property based on the current tax declaration of the property to be expropriated.[28] Therefore, an
ordinance promulgated by the local legislative body authorizing its local chief executive to exercise the power of
eminent domain is necessary prior to the filing by the latter of the complaint with the proper court, and not only after
the court has determined the amount of just compensation to which the defendant is entitled.basra
Neither is respondent's position improved by its reliance upon Article 36 (a), Rule VI of the IRR which provides that:
If the LGU fails to acquire a private property for public use, purpose, or welfare through purchase, LGU may expropriate
said property through a resolution of the sanggunian authorizing its chief executive to initiate expropriation
proceedings.
The Court has already discussed this inconsistency between the Code and the IRR, which is more apparent than real,
in Municipality of Paraaque vs. V.M. Realty Corporation,[29] which we quote hereunder:
Petitioner relies on Article 36, Rule VI of the Implementing Rules, which requires only a resolution to authorize an LGU to
exercise eminent domain. This is clearly misplaced, because Section 19 of RA 7160, the law itself, surely prevails over
said rule which merely seeks to implement it. It is axiomatic that the clear