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Mandanas v. Ochoa, Jr.

of each quarter, and which shall not be subject to any lien or


holdback that may be imposed by the National Government for
G.R. No. 199802; G.R. No. 208488; July 3, 2018 whatever purpose. x x x
En Banc, Bersamin, J.

PROCEDURAL ISSUE

The petitioners hereby challenge the manner in which Mandamus Improper Remedy
the just share in the national taxes of the local government
units (LGUs) has been computed. • Mandamus only lies to compel a ministerial act. The
burden of proof is on the mandamus petitioner to
This is a special civil action for certiorari, prohibition show that he is entitled to the performance of a legal
and mandamus assailing the manner the General right, and that the respondent has a corresponding
Appropriations Act (GAA) for FY 2012 computed the IRA for the duty to perform the act.
LGUs. Certain collections of NIRTs by the Bureau of Customs • Determination of what constitutes the just share of
(BOC) — specifically: excise taxes, value added taxes (VATs) the LGUs in the national taxes under the 1987
and documentary stamp taxes (DSTs) — have not been Constitution is an entirely discretionary power. The
included in the base amounts for the computation of the IRA. discretion of Congress thereon, being exclusive, is not
subject to external direction; otherwise, the delicate
The procedural issue is the propriety of the remedy of
balance underlying our system of government may be
mandamus in violation of doctrine of separation of powers.
unduly disturbed. (VIOLATION OF DOCTRINE OF
The substantive issue is whether Section 284 of the SEPARATION OF POWERS)
LGC is unconstitutional for being repugnant to Section 6, Article
HOWEVER, the allegations of the petition shows that this is also
X of the 1987 Constitution.
a Petition for Certiorari:

• The petition, while dubbed as a petition for


Sec. 6, Art. X, 1987 Constitution. mandamus, is also a petition for certiorari because it
alleges that Congress thereby committed grave abuse
Local government units shall have a just share, as determined of discretion amounting to lack or excess of
by law, in the national taxes which shall be automatically jurisdiction.
released to them. o That the non-release of some portions of
their IRA balances is due to alleged
congressional indiscretion — the diminution
of the base amount for computing the LGU's
Sec. 284, Local Government Code. Allotment of Internal
just share. The insertion by Congress of the
Revenue Taxes.
words internal revenue in the phrase national
Local government units shall have a share in the national taxes.
• The actual nature of every action is determined by the
internal revenue taxes based on the collection of the third
fiscal year preceding the current Gscal year as follows: allegations in the body of the pleading or the
complaint itself, not by the nomenclature used to
• xxx designate the same. Moreover, neither should the
prayer for relief be controlling; hence, the courts may
still grant the proper relief as the facts alleged in the
pleadings and the evidence introduced may warrant
Sec. 21, National Internal Revenue Code, as amended. even without a prayer for specific remedy.
Sources of Revenue.

The following taxes, fees and charges are deemed to be


national internal revenue taxes: SUBSTANTIVE ISSUE

a) Income tax; (1) Section 284 of the LGC deviates from the plain
b) Estate and donor's taxes; language of Section 6 of Article X of the 1987
c) Value-added tax; Constitution
d) Other percentage taxes;
e) Excise taxes; • The phrase national internal revenue taxes engrafted
f) Documentary stamp taxes; and in Section 284 is undoubtedly more restrictive than
g) Such other taxes as are or hereafter may be imposed the term national taxes written in Section 6. Verba
and collected by the Bureau of Internal Revenue. legis non est recedendum (from the words of a statute
there should be no departure).
• According to Garcia v. Executive Secretary, customs
duties is the nomenclature given to taxes imposed on
Section 286, Local Government Code. Automatic Release the importation and exportation of commodities and
of Shares. merchandise to or from a foreign country. Although
customs duties have either or both the generation of
(a) The share of each local government unit shall be released,
revenue and the regulation of economic or social
without need of any further action, directly to the
activity as their moving purposes, it is often difficult
provincial, city, municipal or barangay treasurer, as the case
to say which of the two is the principal objective in a
may be, on a quarterly basis within Gve (5) days after the end
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particular instance, for, verily, customs duties, much Excluded in the base for computing the just share
like internal revenue taxes, are rarely designed to
achieve only one policy objective. • Proceeds do not come from a tax, fee or exaction
• Strictly speaking, customs duties are also taxes imposed on the sale and conversion:
because they are exactions whose proceeds become o Share of the affected LGUs in the proceeds of
public funds. the sale and conversion of the former military
• Further, Section 102 (oo) of R.A. No. 10863 (Customs bases pursuant to R.A. No. 7227.
Modernization and Tariff Act) expressly includes all • Conforms to Section 29 (3), Article VI of the 1987
fees and charges imposed under the Act under the Constitution as money collected on any tax levied for
blanket term of taxes. a special purpose:
o Excise taxes imposed on: (1) locally
manufactured Virginia tobacco products; (2)
the share of the affected LGUs in incremental
(2) Congress can validly exclude taxes that will revenues from Burley and native tobacco
constitute the base amount for the computation of the products; (3) the share of the COA in the
IRA only if a Constitutional provision allows such NIRTs; and (4) the share of the host LGUs in
exclusion the franchise taxes paid by the Manila Jockey
Club, Inc., and Philippine Racing Club, Inc.
• Although it has the primary discretion to determine
o Same is true for the franchise taxes
and fix the just share of the LGUs in the national
o paid under Section 6 of R.A. No. 6631 and
taxes, Congress cannot disobey the express mandate
Section 8 of R.A. No. 6632, inasmuch as
of the Constitution for the just share of the LGUs to
certain percentages of the franchise taxes go
be derived from the national taxes.
to different beneficiaries
• The phrase as determined by law in Section 6 follows
• Section 7, Article X of the 1987 Constitution allows
and qualifies the phrase just share, and cannot be
affected LGUs to have an equitable share in the
construed as qualifying the succeeding phrase in the
proceeds of the utilization of the nation's national
national taxes. The intent of the people in respect of
wealth "within their respective areas.
Section 6 is really that the base for reckoning the just
o Exclusion of the share of the different LGUs
share of the LGUs should includes all national taxes.
in the excise taxes imposed on mineral
• To read Section 6 differently as requiring that the just
products pursuant to Section 287 of the NIRC
share of LGUs in the national taxes shall be
in relation to Section 290.
determined by law is tantamount to the unauthorized
• Properly excluded for such taxes are intended to truly
revision of the Constitution.
enable a sustainable and feasible autonomous region
as guaranteed by the 1987 Constitution.
o NIRTs collected by the provinces and cities
The national taxes to be included in the base for within the ARMM whose portions are
computing the just share the LGUs shall henceforth be, distributed to the ARMM's provincial, city and
but shall not be limited to, the following: regional governments.

1. The NIRTs enumerated in Section 21 of the NIRC, as


amended, to be inclusive of the VATs, excise taxes, and
DSTs collected by the BIR and the BOC, and their PAYMENT OF THE ARREARS OF THE LGUS' JUST SHARE
deputized agents; CANNOT BE GRANTED
2. Tariff and customs duties collected by the BOC;
• The doctrine of operative fact recognizes the existence
3. 50% of the VATs collected in the ARMM, and 30% of all
of the law or executive act prior to the determination
other national taxes collected in the ARMM; the remaining
of its unconstitutionality as an operative fact that
50% of the VATs and 70% of the collections of the other
produced consequences that cannot always be erased,
national taxes in the ARMM shall be the exclusive share of
ignored or disregarded. In short, it nullifies the void
the ARMM pursuant to Section 9 and Section 15 of R.A. No.
law or executive act but sustains its effects. It
9054;
provides an exception to the general rule that a void
4. 60% of the national taxes collected from the exploitation
or unconstitutional law produces no effect.
and development of the national wealth; the remaining
40% will exclusively accrue to the host LGUs pursuant to
Section 290 of the LGC;
5. 85% of the excise taxes collected from locally AUTOMATIC RELEASE OF THE LGUS' JUST SHARE IN THE
manufactured Virginia and other tobacco products; the NATIONAL TAXES
remaining 15% shall accrue to the special purpose funds
pursuant created in R.A. No. 7171 and R.A. No. 7227; • The 1987 Constitution is forthright and unequivocal in
6. The entire 50% of the national taxes collected under ordering that the just share of the LGUs in the national
Section 106, Section 108 and Section 116 of the NIRC in taxes shall be automatically released to them. With
excess of the increase in collections for the immediately Congress having established the just share through
preceding year; and the LGC, it seems to be beyond debate that the
7. 5% of the franchise taxes in favor of the national inclusion of the just share of the LGUs in the annual
government paid by franchise holders in accordance with GAAs is unnecessary, if not superfluous. Hence, the
Section 6 of R.A. No. 6631 and Section 8 of R.A. No. 6632. just share of the LGUs in the national taxes shall be
released to them without need of yearly appropriation.

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• Section 6, Article X of the 1987 Constitution creator. Their continued existence and the grant of
commands that the just share of the LGUs in national their powers are dependent on the discretion of
taxes shall be automatically released to them. The Congress.
term automatic connotes something mechanical,
spontaneous and perfunctory; and, in the context of
this case, the LGUs are not required to perform any
(a1) Modified Dillons Rule (Merriam v. Moody’s
act or thing in order to receive their just share in the
Executors)
national taxes.
• This is because Congress not only already determined A municipal corporation possesses and can exercise the
the just share through the LGC's fixing the percentage following powers and no others:
of the collections of the NIRTs to constitute such fair
share, but also explicitly authorized such just share to • (1) those granted in express words;
be "automatically released" to the LGUs in the • (2) those necessarily or fairly implied in or incident to
proportions and regularity set under Section 285 of the powers expressly granted;
the LGC without need of annual appropriation. To • (3) those essential to the declared objects and
operationalize the automatic release without need of purposes of the corporation-not simply convenient but
appropriation, Section 286 of the LGC clearly indispensible;
provides that the automatic release of the just share • (4) any fair, reasonable, doubt as to the existence of
directly to the provincial, city, municipal or barangay a power is resolved by the courts against the
treasurer, as the case may be, shall be "without corporation against the existence of the powers.
need of any further action.”
• As compared to the provisions of the 1987
Constitution on Judiciary, Constitutional Commisions,
Ombudsman, and the Commission on Human rights (a2) Magtajas v. Pryce Properties Corporation, Inc.
which shares to aspects: The first relates to the grant • Municipal governments are only agents of the national
of fiscal autonomy, and the second concerns the
government. Local councils exercise only delegated
automatic release of funds. The common denominator
legislative powers conferred on them by Congress as
of the provisions is that the automatic release of the
the national lawmaking body. The delegate cannot be
appropriated amounts is predicated on the approval
superior to the principal or exercise powers higher
of the annual appropriations of the offices or
than those of the latter.
agencies concerned. • 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
DISCUSSION IN THE MAIN DECISION they cannot exist. As it creates, so it may destroy. As
it may destroy, it may abridge and control. Unless
Local Autonomy there is some constitutional limitation on the right, the
legislature might, by a single act, and if we can
• One of the key features of the 1987 Constitution is its suppose it capable of so great a folly and so great a
push towards decentralization of government and wrong, sweep from existence all of the municipal
local autonomy. corporations in the State, and the corporation could
• Local autonomy has two facets, the administrative not prevent it. We know of no limitation on the right
and the fiscal. so far as to the corporation themselves are concerned.
o Fiscal autonomy means that local They are, so to phrase it, the mere tenants at will of
governments have the power to create their the legislature.
own sources of revenue in addition to their • This basic relationship between the national
equitable share in the national taxes released legislature and the local government units has not
by the National Government, as well as the been enfeebled by the new provisions in the
power to allocate their resources in Constitution strengthening the policy of local
accordance with their own priorities. autonomy. True, there are certain notable innovations
o Such autonomy is as indispensable to the in the Constitution, like the direct conferment on the
viability of the policy of decentralization as local government units of the power to tax, which
the other. 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
(A) Basic Principles underlying our System of Local defy its will or modify or violate it.
Government

• Municipal corporations are now commonly known as (a3) Sec. 5 (a) LGC (Tempered the Application of Dillon’s
local governments. They are the bodies politic Rule)
established by law partly as agencies of the State to
• Any provision on a power of a local government unit
assist in the civil governance of the country. Their
shall be liberally interpreted in its favor, and in case
chief purpose has been to regulate and administer the
of doubt, any question thereon shall be resolved in
local and internal affairs of the cities, municipalities or
favor of devolution of powers and of the local
districts.
government unit. Any fair and reasonable doubt as to
• Municipal corporations, being the mere creatures of
the existence of the power shall be interpreted in favor
the State, are subject to the will of Congress, their
of the local government unit concerned;
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• In turn, the economic, political and social
developments of the smaller political units are
(B) Extent of the Autonomy granted to the LGUs by the expected to propel social and economic growth and
1987 Constitution development.
• It is not unlimited but involves only the powers
• The 1987 Constitution limits Congress' control over
enumerated by Section 20, Article X of the 1987
the LGUs by ordaining in Section 25 of its Article II
Constitution and by the acts of Congress.
that: "The State shall ensure the autonomy of local
governments." The autonomy of the LGUs as thereby
ensured does not contemplate the fragmentation of
the Philippines into a collection of mini-states, or the Decentralization under Sec. 3 of the LGC
creation of imperium in imperio.
• The constitutional mandate to ensure local autonomy Based on the delineation of the operative principles of
refers to decentralization. decentralization under Sec. 3, decentralization can be
• Decentralization of Power considered as the decision by the central government to
o Involves the abdication of political power in empower its subordinates, whether geographically or
favor of the autonomous LGUs as to grant functionally constituted, to exercise authority in certain areas.
them the freedom to chart their own It involves decision-making by subnational units, and is
destinies and to shape their futures with typically a delegated power, whereby a larger government
minimum intervention from the central chooses to delegate authority to more local governments. It is
government. also a process, being the set of policies, electoral or
o This amounts to self-immolation because the constitutional reforms that transfer responsibilities, resources
autonomous LGUs thereby become or authority from the higher to the lower levels of government.
accountable not to the central authorities but It is often viewed as a shift of authority towards local
to their constituencies. governments and away from the central government, with total
• Decentralization of Administration government authority over society and economy imagined as
o Occurs when the central government fixed.
delegates administrative powers to the LGUs
as the means of broadening the base of
governmental powers and of making the As a system of transferring authority and power from
LGUs more responsive and accountable in the National Government to the LGUs, decentralization
the process, and thereby ensure their fullest in the Philippines may be categorized into four, namely:
development as self-reliant communities and
more effective partners in the pursuit of the (1) Political decentralization or devolution;
goals of national development and social (2) Administrative decentralization or deconcentration;
progress. This form of decentralization (3) Fiscal decentralization; and
further relieves the central government of (4) Policy or decision-making decentralization.
the burden of managing local affairs so that
it can concentrate on national concerns.

Political decentralization or devolution

Decentralization of Power in the Philippines • occurs when there is a transfer of powers,


responsibilities, and resources from the central
• The decentralization of power has been given to the government to the LGUs for the performance of
regional units (namely, the Autonomous Region for certain functions.
Muslim Mindanao [ARMM] and the constitutionally- • It is a more liberal form of decentralization because
mandated Cordillera Autonomous Region [CAR]). there is an actual transfer of powers and
• This aims to permit determinate groups with common responsibilities. It aims to grant greater autonomy to
traditions and shared social-cultural characteristics to the LGUs in cognizance of their right to self-
freely develop their ways of life and heritage, to government, to make them self-reliant, and to
exercise their rights, and to be in charge of their own improve their administrative and technical
affairs through the establishment of a special capabilities.
governance regime for certain member communities • Section 16 to Section 19 of the LGC characterize
who choose their own authorities from within political decentralization in the LGC as different LGUs
themselves, and exercise the jurisdictional authority empowered to address the different needs of their
legally accorded to them to decide their internal constituents. In contrast, devolution in favor of the
community affairs. regional units is more expansive because they are
given the authority to regulate a wider array of
subjects, including personal, family and property
relations.
Decentralization of Administration in the Philippines

• LGUs (i.e., provinces, cities, municipalities and


barangays) enjoy the decentralization of
administration to make governance at the local levels
more directly responsive and effective.

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Administrative decentralization or deconcentration

• involves the transfer of functions or the delegation of


authority and responsibility from the national office to
the regional and local offices.
• Consistent with this concept, the LGC has created the
Local School Boards, the Local Health Boards and the
Local Development Councils, and has transferred
some of the authority from the agencies of the
National Government, like the Department of
Education and the Department of Health, to such
bodies to better cope up with the needs of particular
localities.

Fiscal decentralization

• means that the LGUs have the power to create their


own sources of revenue in addition to their just share
in the national taxes released by the National
Government.
• It includes the power to allocate their resources in
accordance with their own priorities.
• Fiscal decentralization emanates from a specific
constitutional mandate that is expressed in several
provisions of Article X of the 1987 Constitution,
specifically: Section 5; Section 6; and Section 7.
• Fiscal decentralization under the Constitution been
formalized from Section 128 to Section 133 of the
LGC. To implement the LGUs' entitlement to the just
share in the national taxes, Congress has enacted
Section 284 to Section 288 of the LGC. Congress has
further enacted Section 289 to Section 294 of the LGC
to define the share of the LGUs in the national wealth.
• This is limited by Congress in subjecting the LGUs'
power to tax to the guidelines set in Section 130 of
the LGC and to the limitations stated in Section 133
of the LGC. The concept of local fiscal autonomy does
not exclude any manner of intervention by the
National Government in the form of supervision if only
to ensure that the local programs, fiscal and
otherwise, are consistent with the national goals.

Policy- or decision-making decentralization

• exists if at least one subnational tier of government


has exclusive authority to make decisions on at least
one policy issue.

RODOLFO G. NAVARRO v. EXECUTIVE SECRETARY EDUARDO ERMITA, (D)

G.R. No. 180050, April 12, 2011

FACTS:

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).
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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). The plebiscite yielded
69,943 affirmative votes and 63,502 negative votes. With the approval of the people from both the mother
province of Surigao del Norte and the Province of Dinagat Islands (Dinagat).

November 10, 2006, petitioners filed before this Court a petition for certiorari and prohibition challenging the
constitutionality of R.A. No. 9355. The Court dismissed the petition on technical grounds. Their motion for
reconsideration was also denied.

Undaunted, petitioners filed another petition for certiorari 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.

May 12, 2010, 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.

July 20, 2010, 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.

September 7, 2010, movants-intervenors filed a Motion for Reconsideration of the July 20, 2010 Resolution,
citing several rulings 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.

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.

ISSUE:

Whether or not the provision in Article 9(2) of the Rules and Regulations Implementing the Local Government
Code of 1991 valid.

HELD:

Yes, the 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
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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.

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 Dinagat’s 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.

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.

Law Creating Dinagat Province Valid? (2011 update)


The National Statistics Office certified that Dinagat Islands’ population is 120,813. Its land area is 802.12 square
kilometers and its average annual income is P82,696,433.23, as certified by the Bureau of Local Government
Finance. On October 2, 2006, the President approved into law R.A. 9355 creating the Province of Dinagat
Islands. On December 3, 2006, the COMELEC conducted the mandatory plebiscite for the ratification of the creation
of the province under the LGC which yielded 69,943 affirmative votes and 63,502 negative votes. 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.

Meanwhile, on November 10, 2006, petitioners Rodolfo G. Navarro and other former political leaders of Surigao del
Norte, filed before the SC a petition for certiorari and prohibition (G.R. No. 175158) challenging the constitutionality of R.A. No.
9355 alleging that 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. Is R.A. No. 9355 constitutional?

Suggested Answer:

February 10, 2010 Ruling

No. The SC ruled that the population of 120,813 is below the Local Government Code (LGC) minimum population
requirement of 250,000 inhabitants. Neither did Dinagat Islands, with an approximate land area of 802.12 square
kilometers meet the LGC minimum land area requirement of 2,000 square kilometers. The Court reiterated its ruling that
paragraph 2 of Article 9 of the Rules and Regulations Implementing the Local Government Code, which exempts proposed
provinces composed of one or more islands from the land area requirement, was null and void as the said exemption is
not found in Sec. 461 of the LGC. “There is no dispute that in case of discrepancy between the basic law and the rules
and regulations implementing the said law, the basic law prevails, because the rules and regulations cannot go beyond
the terms and provisions of the basic law,” held the Court. (GR No. 180050, Navarro v. Ermita, May 12, 2010)

The Republic, represented by the Office of the Solicitor General, and Dinagat filed their respective motions for
reconsideration of the Decision. In its Resolution dated May 12, 2010, the Supreme Court denied the said motions.

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April 12, 2011 Ruling

Yes. In Navarro vs. Executive Secretary (G.R. no. 180050, April 12, 2011), the Honorable Supreme Court ruled that Republic Act No.
9355 is as VALID and CONSTITUTIONAL, and the proclamation of the Province of Dinagat Islands and the election of the officials
thereof are declared VALID.

The SC also ruled that 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.

According to the SC, “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.”

xxx “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 fellester.blogspot.com 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.”

xxx“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. fellester.blogspot.com 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.”

xxx “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
fellester.blogspot.com 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 Dinagat’s existence as a province, they must be seen from the perspective that
Dinagat is ready and capable of becoming a province.” (Navarro vs. Executive Secretary (G.R. no. 180050, April 12, 2011)

Umali vs. COMELEC, 723 SCRA 170 (2014)


By: G-one T. Paisones

Salient Feature:
2016 Bar Examination; Question No. 3

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Facts:
On July 11, 2011, the Sangguniang Panglungsod of Cabanatuan City passed Resolution No.
183-2011, requesting the President to declare the conversion of Cabanatuan City from a component
city of the province of Nueva Ecija into a highly urbanized city (HUC). Acceding to the request, the
President issued Presidential Proclamation No. 418, Series of 2012, proclaiming the City of
Cabanatuan as an HUC subject to “ratification in a plebiscite by the qualified voters therein, as
provided for in Section 453 of the Local Government Code of 1991.”
Respondent COMELEC, acting on the proclamation, issued the assailed Minute Resolution
No. 12-0797 which reads:
WHEREFORE, the Commission RESOLVED, as it hereby RESOLVES, that for purposes of
the plebiscite for the conversion of Cabanatuan City from component city to highly-urbanized city,
only those registered residents of Cabanatuan City should participate in the said plebiscite.
The COMELEC based this resolution on Sec. 453 of the Local Government Code of 1991
(LGC), citing conversion cases involving Puerto Princesa City in Palawan, Tacloban City in Southern
Leyte, and Lapu-Lapu City in Cebu, where only the residents of the city proposed to be converted
were allowed to vote in the corresponding plebiscite.
Petitioner Aurelio M. Umali, Governor of Nueva Ecija, filed a Verified Motion for
Reconsideration, maintaining that the proposed conversion in question will necessarily and directly
affect the mother province of Nueva Ecija. His main argument is that Section 453 of the LGC should
be interpreted in conjunction with Sec. 10, Art. X of the Constitution. He argues that while the
conversion in question does not involve the creation of a new or the dissolution of an existing city, the
spirit of the Constitutional provision calls for the people of the LGU directly affected to vote in a
plebiscite whenever there is a material change in their rights and responsibilities. The phrase “qualified
voters therein” used in Sec. 453 of the LGC should then be interpreted to refer to the qualified voters
of the units directly affected by the conversion and not just those in the component city proposed to be
upgraded. Petitioner Umali justified his position by enumerating the various adverse effects of the
Cabanatuan City’s conversion and how it will cause material change not only in the political and
economic rights of the city and its residents but also of the province as a whole.
On October 4, 2012, the COMELEC En Banc on October 16, 2012, in E.M No. 12-045
(PLEB), by a vote of 5-2 ruled in favor of respondent Vergara through the assailed Minute Resolution
12-0925.

Issue:
Whether the qualified registered voters of the entire province of Nueva Ecija or only those in
Cabanatuan City can participate in the plebiscite called for the conversion of Cabanatuan City from a
component city into a Highly Urbanized City (HUC).

Held:
Entire province of Nueva Ecija

Ratio:
The upward conversion of a component city, in this case Cabanatuan City, into an HUC will
come at a steep price. It can be gleaned from the above-cited rule that the province will inevitably
suffer a corresponding decrease in territory brought about by Cabanatuan City’s gain of independence.
With the city’s newfound autonomy, it will be free from the oversight powers of the province, which,
in effect, reduces the territorial jurisdiction of the latter. What once formed part of Nueva Ecija will no
longer
yaki be subject to supervision by the province. In more concrete terms, Nueva Ecija stands to lose
282.75 sq. km. of its territorial jurisdiction with Cabanatuan City’s severance from its mother
province. This is equivalent to carving out almost 5% of Nueva Ecija’s 5,751.3 sq. km. area. This
sufficiently satisfies the requirement that the alteration be “substantial.”

UMALI vs. COMMISSION ON ELECTIONS, G.R. No. 203974, April


22, 2014
CONSTITUTIONAL LAW; SUPREME LAW OF THE LAND; Hornbook doctrine is that neither the legislative, the executive, nor the
judiciary has the power to act beyond the Constitution’s mandate. The Constitution is supreme; any exercise of power beyond what
is circumscribed by the Constitution is ultra vires and a nullity. As elucidated by former Chief Justice Enrique Fernando in
Fernandez v. Cuerva:

CONSTITUTIONAL LAW; CONTRARY TO THE CONSTITUTION; LEGISLATIVE OR EXECUTIVE ACTS ARE VOID. Where the
assailed legislative or executive act is found by the judiciary to be contrary to the Constitution, it is null and void. As the new Civil
Code puts it: "When the courts declare a law to be inconsistent with the Constitution, the former shall be void and the latter shall
govern." Administrative or executive acts, orders and regulations shall be valid only when they are not contrary to the laws or the
Constitution. The above provision of the civil Code reflects the orthodox view that an unconstitutional act, whether legislative or
executive, is not a law, confers no rights, imposes no duties, and affords no protection. x x x

CONSTITUTIONAL LAW; LAW SHOULD BE CONSTRUED IN HARMONY OF THE CONSTITUTION. Applying this orthodox
view, a law should be construed in harmony with and not in violation of the Constitution. In a long line of cases, the cardinal
principle of construction established is that a statute should be interpreted to assure its being in consonance with, rather than
repugnant to, any constitutional command or prescription. If there is doubt or uncertainty as to the meaning of the legislative, if the
words or provisions are obscure or if the enactment is fairly susceptible of two or more constitution, that interpretation which will
avoid the effect of unconstitutionality will be adopted, even though it may be necessary, for this purpose, to disregard the more
usual or apparent import of the language used.

POLITICAL LAW; MEANING OF QUALIFIED VOTERS THEREIN.Pursuant to established jurisprudence, the phrase "by the
qualified voters therein" in Sec. 453 should be construed in a manner that will avoid conflict with the Constitution. If one takes the
plain meaning of the phrase in relation to the declaration by the President that a city is an HUC, then, Sec. 453 of the LGC will clash
with the explicit provision under Sec. 10, Art. X that the voters in the "political units directly affected" shall participate in the
plebiscite. Such construction should be avoided in view of the supremacy of the Constitution. Thus, the Court treats the phrase "by
the qualified voters therein" in Sec. 453 to mean the qualified voters not only in the city proposed to be converted to an HUC but
also the voters of the political units directly affected by such conversion in order to harmonize Sec. 453 with Sec. 10, Art. X of the
Constitution.

POLITICAL LAW; POLITICAL UNITS DIRECTLY AFFECTED; DEFINED.In identifying the LGU or LGUs that should be allowed to
take part in the plebiscite, what should primarily be determined is whether or not the unit or units that desire to participate will be
"directly affected" by the change. To interpret the phrase, Tan v. COMELEC and Padilla v. COMELEC are worth revisiting.

We have ruled in Tan, involving the division of Negros Occidental for the creation of the new province of Negros del Norte, that the
LGUs whose boundaries are to be altered and whose economy would be affected are entitled to participate in the plebiscite. As held:

It can be plainly seen that the aforecited constitutional provision makes it imperative that there be first obtained "the approval of a
majority of votes in the plebiscite in the unit or units affected" whenever a province is created, divided or merged and there is
substantial alteration of the boundaries. It is thus inescapable to conclude that the boundaries of the existing province of Negros
Occidental would necessarily be substantially altered by the division of its existing boundaries in order that there can be created the
proposed new province of Negros del Norte. Plain and simple logic will demonstrate than that two political units would be affected.

G.R.
yaki
No. 207257 February 3, 2015
HON. RAMON JESUS PAJE, in his capacity as DENR Secretary v. Hon. Teodoro Casino, et
al.

Facts

The Department of Environment and Natural Resources, issued an Environmental Compliance


Certificate for a proposed coal-fired power plant at Subic, Zambales to be implemented by RP
Energy.

Hon. Teodoro Casino and a number of legislators filed a Petition for Writ of Kalikasan against RP
energy, SBMA, and Hon. Ramon Paje as the DENR secretary on the ground that actual
environmental damage will occur if the power plant project is implemented and that the
respondents failed to comply with certain laws and rules governing or relating to the issuance of
an ECC and amendments thereto.

The Court of Appeals denied the petition for the Writ of Kalikasan and invalidated the ECC. Both
the DENR and Casino filed an appeal, the former imputing error in invalidating the ECC and its
amendments, arguing that the determination of the validity of the ECC as well as its amendments
is beyond the scope of a Petition for a Writ of kalikasan; while the latter claim that it is entitled to
a Writ of Kalikasan.

Issues

1. Whether the parties may raise questions of fact on appeal on the issuance of a writ of
Kalikasan; and
2. Whether the validity of an ECC can be challenged via a writ of Kalikasan

Ruling

1. Yes, the parties may raise questions of fact on appeal on the issuance of a writ of
Kalikasan because the Rules on the Writ of kalikasan (Rule 7, Section 16 of the Rules of
Procedure for Environmental Cases)allow the parties to raise, on appeal, questions of
fact— and, thus, constitutes an exception to Rule 45 of the Rules of Court— because of
the extraordinary nature of the circumstances surrounding the issuance of a writ
of kalikasan.
2. Yes, the validity of an ECC can be challenged via a writ of Kalikasan because such writ is
principally predicated on an actual or threatened violation of the constitutional right to a
balanced and healthful ecology, which involves environmental damage of a magnitude
that transcends political and territorial boundaries.

A party, therefore, who invokes the writ based on alleged defects or irregularities in the issuance
of an ECC must not only allege and prove such defects or irregularities, but must also provide a
causal link or, at least, a reasonable connection between the defects or irregularities in the
issuance of an ECC and the actual or threatened violation of the constitutional right to a balanced
and healthful ecology of the magnitude contemplated under the Rules. Otherwise, the petition
should be dismissed outright and the action re-filed before the proper forum with due regard to
the doctrine of exhaustion of administrative remedies.

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In the case at bar, no such causal link or reasonable connection was shown or even attempted
relative to the aforesaid second set of allegations. It is a mere listing of the perceived defects or
irregularities in the issuance of the ECC.

Paje vs Casino (749 SCRA 39)

FACTS:

 In February 2006, Subic Bay Metropolitan Authority (SBMA), a government agency organized
and established under Republic Act No. (RA) 7227, and Taiwan Cogeneration Corporation
(TCC) entered into a Memorandum of Understanding (MOU) expressing their intention to
build a power plant in Subic Bay which would supply reliable and affordable power to Subic
Bay Industrial Park (SBIP).
 On July 28, 2006, SBMA and TCC entered into another MOU, whereby TCC undertook to build
and operate a coal-fired power plant.
 On April 4, 2007, the SBMA Ecology Center issued SBFZ Environmental Compliance Certificate
(ECC) in favor of Taiwan Cogeneration International Corporation (TCIC), a subsidiary of TCC,
for the construction, installation, and operation of 2x150-MW Circulating Fluidized Bed (CFB)
Coal-Fired Thermal Power Plant at Sitio Naglatore.
 On June 6, 2008, TCC assigned all its rights and interests under the MOU dated July 28, 2006
to Redondo Peninsula Energy, Inc. (RP Energy).
 RP Energy then contracted GHD Pty., Ltd. (GHD) to prepare an Environmental Impact
Statement (EIS) for the proposed coal-fired power plant and to assist RP Energy in applying
for the issuance of an ECC from the Department of Environment and Natural Resources
(DENR).
 The Sangguniang Panglungsod of Olongapo City issued Resolution No. 131, Series of
2008, expressing the city government’s objection to the coal-fired power plant as an
energy source and urging the proponent to consider safer alternative sources
ofenergy for Subic Bay.
 On December 22, 2008, the DENR, through former Secretary Jose L. Atienza, Jr., issued an ECC
for the proposed 2x150-MW coal-fired power plant.
 Sometime thereafter, RP Energy decided to include additional components in its proposed
coal-fired power plant. On July 8, 2010, the DENR-EMB issued an amended ECC (first
amendment) allowing the inclusion of additional components, among others.
 Several months later, RP Energy again requested the DENR-EMB to amend the ECC. Instead of
constructing a 2x150-MW coal-fired power plant, as originally planned, it now sought to
construct a 1x300-MW coal-fired power plant.
 On May 26, 2011, the DENR-EMB granted the request and further amended the ECC (second
amendment).
 The Sangguniang Panglalawiganof Zambales issued Resolution No. 2011-149,
opposing the establishment of a coal-fired thermal power plant.
 The Liga ng mga Barangayof Olongapo City issued Resolution No. 12, Series of 2011,
expressing its strong objection to the coal-fired power plant as an energy source.
 Hon. Casino’s group filed for a writ of kalikasan against RP energy, SBMA, DENR. The Casiño
Group alleged, among others, that the power plant project would cause environmental
damage. that it would adversely affect the health of the residents of the municipalities of
Subic, Zambales, Morong, Hermosa, and the City of Olongapo.
 While the case was pending in the CA, RP Energy applied for another amendment to its ECC
proposing the construction and operation of a 2x300-MW coal fired power plant
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CA:

Denied the writ of kalikasan due to the failure of the Casiño Group to prove that its
constitutional right to a balanced and healthful ecology was violated or threatened

- no reason also to nullify sec 8.3 of DAO 2003-30) which allows amendments of ECCs. Not ultra
vires, as the express power of the Secretary of DENR, director and regional directors of the
EMB to issue an ECC impliedly includes the incidental power to amend the same.
- The validity of the said section cannot be collaterally attacked in a petition for a writ of
kalikasan
But invalidated the ECC for non-compliance with the IPRA law and LGC and failure to affix the
signature in the sworn statement of full responsibility

- Non-compliance with sec 59 of IPRA Law (enjoins all departments and other governmental
agencies from granting any lease without a prior certification that the area affected does not
overlap with any ancestral domain)
- The CA also invalidated the LDA entered into by SBMA and RP Energy as it was
issued without the prior consultation and approval of all the sanggunians concerned as
required under Sections 26 and 27 of the LGC
- For failure of Luis Miguel Abolitz, director of RP Energy to affix his signature in the sworn
statement of full responsibility (integral part of the ECC)
- The first and second amendment for failure to comply with the restrictions in the ECC which
requires that any expansion of the project beyond the project description or any change in
the activity shall be subject to a new environmental impact assessment
Invalidated the LDA entered into by SBMA and RP Energy

- Issued without prior consultation and approval of all the sanggunians concerned as under
secs 26 and 27 of the LGC
- In violation of sec 59 chapter VIII of the IPRA Law which enjoins all departments and other
governmental agencies from granting any lease without a prior certification that the area
affected does not overlap with any ancestral domain
- no CNO was secured from the NCIP prior to the execution of the LDA and that the
CNO dated October 31, 2012 was secured during the pendency of the case and was
issued in connection with RP Energy’s application for a 2x300 MW Coal fired plant

ISSUE

1. Whether the parties may raise questions of fact on appeal on the issuance of a writ of
Kalikasan; and
2. Whether the validity of an ECC can be challenged via a writ of Kalikasan

Ruling

1. Yes, the parties may raise questions of fact on appeal on the issuance of a writ of Kalikasan
because the Rules on the Writ of kalikasan (Rule 7, Section 16 of the Rules of Procedure for
Environmental Cases) allow the parties to raise, on appeal, questions of fact— and, thus,
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constitutes an exception to Rule 45 of the Rules of Court— because of the extraordinary
nature of the circumstances surrounding the issuance of a writ of kalikasan.

2. Yes, the validity of an ECC can be challenged via a writ of Kalikasan because such writ is
principally predicated on an actual or threatened violation of the constitutional right to a
balanced and healthful ecology, which involves environmental damage of a magnitude that
transcends political and territorial boundaries.

A party, therefore, who invokes the writ based on alleged defects or irregularities in the
issuance of an ECC must not only allege and prove such defects or irregularities, but must
also provide a causal link or, at least, a reasonable connection between the defects or
irregularities in the issuance of an ECC and the actual or threatened violation of the
constitutional right to a balanced and healthful ecology of the magnitude contemplated under
the Rules. Otherwise, the petition should be dismissed outright and the action re-filed before
the proper forum with due regard to the doctrine of exhaustion of administrative remedies.

In the case at bar, no such causal link or reasonable connection was shown or even
attempted relative to the aforesaid second set of allegations. It is a mere listing of the
perceived defects or irregularities in the issuance of the ECC.
The appellate court correctly ruled that the Casino group FAILED to substantiate its claims
that the construction and operation of the power plant will cause environmental damage of
the magnitude contemplated under the writ of kalikasan. On the other hand, RP Energy
presented evidence to establish that the subject project will not cause grave environmental
damage through its environmental management plan which will ensure that the project will
operate within the limits of existing environmental laws and standars.

OTHER ISSUES:

 CA erred in invalidating the ECC on the ground of lack of signature of Mr. Abolitz in
the ECC’s statement of accountability relative to the copy of the ECC submitted by RP
Energy to the CA. The circumstance of the case show that the DENR and RP Energy
were not properly apprised of the issue of lack of signature in order for them to present
controverting evidence and arguments on this point, as the issue only arose during the
course of the proceedings upon clarificatory questions from the CA.
 CA erred when it ruled that the first and second amendments to the ECC were invalid
for failure to comply with a new EIA and for violating DAO 2003-30 and the Revised
Manual. DENR reasonably exercised its discretion in requiring an ERMP and a
PDR for the first and second amendment respectively. Through these
documents which the DENR reviewed, a new EIA was conducted relative to the
proposed project modifications. No showing of grave abuse of discretion or
patent illegality.
 CA erred when it invalidated ECC for failure to comply with sec 59 of the IPRA Law.
The ECC is not the license or permit contemplated under sec 59. There is no
necessity to secure the Certificate of Non Overlap (CNO) under sec 59 before
and ECC may be issued and the issuance of the subject ECC without first
securing the aforesaid certification does not render it invalid.
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 CA erred when it ruled that compliance with sec 27 in relation to sec 26 of the LGC
(approval of the concerned sanggunian requirement) is necessary prior to issuance of
the subject ECC) issuance of the ECC does not, by itself, result in the implementation
of the project. Hence, there is no necessity to secure prior compliance with the
approval of the concerned sanggunian requirement and the issuance of the
subject ECC without first complying with the aforesaid requirement does not
render it invalid.

Police Power; General Welfare Clause


G.R. L-3087-88 -- Rimando v. Naguilian Emission Testing Center
Concepcion, J.

Naguilian Emissions was running a business on land owned by the government. It sought to renew its business license in 2008.
However, the mayor of Naguilian town refused to issue the license without the execution of a contract of lease between the
business and the municipality. They could not agree on the terms hence a petition for mandamus was filed against the mayor by
the business. This was granted by the lower court, whose decision was then overturned by the CA, which found that a tax
declaration is not sufficient proof of ownership of the property by the municipality.

DOCTRINE
A mayor cannot be compelled by mandamus to issue a business permit since the exercise of the same is a delegated police power,
hence discretionary in nature.

FACTS
1. Naguilian Emission Testing Center, Inc. was operating an emission testing center in Naguilian, La Union (surprise!) on land
owned by the government, but was subsequently declared alienable and disposable by the DENR.
2. From 2005 to 2007, the business operated without any problem. In 2008, the business applied for a renewal of its
business license and paid the fees therefor.
3. Abraham Rimando, mayor of Naguilian, La Union, refused to issue the license until the business executes a contract
of lease with the Municipality of Naguilian.
4. The business was amenable to this condition, subject to some proposed revisions. (What these revisions were was not
mentioned in the case.) However, these revisions were not acceptable to the Mayor.
5. A petition for mandamus was filed by the business with the RTC against the Mayor.
6. The RTC denied the petition, based on the following findings:
a. That the Municipality of Naguilian was the declared owner of the subject property as evidenced by the tax declaration
over the property;
b. Under Sec. 6A.01 of the Revenue Code, the municipality has the right to require petitioner to sign a contract of lease;
and
c. A mayor’s duty to issue business permits is discretionary in nature.
7. The Court of Appeals, while declaring the issue moot and academic since the period for which the business permit was
sought (year 2008) had already lapsed, and Mayor Rimando’s term had already ended. Nonetheless, it proceeded to rule on
the merits and found that the issuance of a write of mandamus was justified. It reversed and set aside the ruling of the
RTC.
a. The CA held that the tax declaration was insufficient basis to require the execution of a contract of lease as a
sine qua non condition for the issuance of a business permit.
b. Also, the resolution of the Sangguniang Panlalawigan (2007-81), upon which the mayor anchored his
imposition of rental fees, was void for its failure to comply with the requirements of the Local Government
Code. (the case fails to mention which requirements)
c. The mayor, however, may not be held liable for damages as his refusal was done in the performance of
official duties.

ISSUE with HOLDING


1. W/N a writ of mandamus to compel Mayor Rimando to issue a business license to Naguilian Emission Testing Center
should have been issued by the court.
a. No. A mayor cannot be compelled by mandamus to issue a business permit since the exercise of the same is
a delegated police power, hence discretionary in nature.
i. This was the pronouncement of the Court in Roble Arrastre, Inc. v. Hon. Villaflor, where a determination
was made on the nature of the power of a mayor to grant business permits under the Local Government
Code.
ii. The Court in that case held that such power to grant permits is a manifestation of delegated police power.
Necessarily, the exercise thereof cannot be deemed ministerial.
iii. The proper remedy is a writ of certiorari, not mandamus.
iv. The grant of such power under the Local Government Code is found in Sec. 444. Such section states that
the municipal mayor’s power to issue licenses is pursuant to Sec. 16 of the same law. Section 16 of
the LGC is the general welfare clause, which encapsulates the delegated police power to local
governments. This is exercised through their respective legislative bodies.
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DISPOSITIVE PORTION
Wherefore, premises considered, the Decision of the Court of Appeals is hereby SET ASIDE. The Decision of the Regional Trial Court of Bauang,
La Union is REINSTATED.

DIGESTER: Horace

SEC. 444. The Chief Executive: Powers, Duties, Functions and Compensation.

(b) For efficient, effective and economical governance the purpose of which is the general welfare of the municipality and its inhabitants pursuant
to Section 16 of this Code, the municipal mayor shall:

3) Initiate and maximize the generation of resources and revenues, and apply the same to the implementation of development plans, program
objectives and priorities as provided for under Section 18 of this Code, particularly those resources and revenues programmed for agro-
industrial development and country-wide growth and progress, and relative thereto, shall:

(iv) Issue licenses and permits and suspend or revoke the same for any violation of the conditions upon which said licenses or permits had
been issued, pursuant to law or ordinance.

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.

ABRAHAM RIMANDO, PETITIONER, VS. NAGUILIAN EMISSION TESTING CENTER, INC.,


REPRESENTED BY ITS PRESIDENT, ROSEMARIE LLARENAS AND HON. COURT OF
APPEALS, RESPONDENTS.

GR NO. 198860 July 23, 2012

FACTS OF THE CASE:

Naguillian Emission Testing Center Inc., filed a petition for mandamus and damages against
Abraham Rimando (petitioner), the municipal mayor of Naguilian, La Union. In its complaint, the
company alleged that from 2005 to 2007 its business is located on a land formerly belonging to the
national government which was later certified as an alienable and disposable land of the public
domain by the DENR. On January 18, 2008, it applied for a renewal of its business permit and paid
the corresponding fees, but the petitioner refused to issue a business permit, until such time that the
company executes a contract of lease with the municipality; the respondent is amenable to signing
the contract but with some revisions, which the petitioner did not accept; no common ground was
reached among the parties, hence the company filed the petition. The RTC ruled in favour of the
petitioner; ratiocinating that: (a) the Municipality of Naguiian is the declared owner of the subject
parcel of land by virtue of Tax Declaration No. 002-01197; (b) under Section 6A.01 of the Revenue
Code of the Municipality of Naguilian, the municipality has the right to require the petitioner to sign a
contract of lease because its business operation is being conducted on a real property owned by the
municipality; and (c) a mayor’s duty to issue business permits is discretionary in nature which may not
be enforced by a mandamus writ.
yaki
On appeal, the CA proceeded to discuss the merits of the case even though the petition itself
is dismissible on the ground of mootness. It held that the factual milieu of the case justifies issuance
of the writ; the tax declaration in the name of the municipality was insufficient basis to require the
execution of a contract of lease as a condition sine qua non for the renewal of a business permit. The
CA further observed that Sangguniang Bayan Resolution No. 2007-81, upon which the municipality
anchored its imposition of rental fees, was void because it failed to comply with the requirements of
the Local Government Code and its Implementing Rules and Regulations. It held the mayor not liable
for damages since he acted in the performance of his duties which are legally protected by the
presumption of regularity in the performance of official duty; the case against the mayor also was
moot and academic since his term as mayor expired. Nevertheless, the CA reversed and set aside
the RTC decision.

The petitioner elevated the matter to the Supreme Court.

ISSUE:

Whether or not the issue had become moot and academic;

Whether or not the issuance of a business permit maybe compelled thru a petition for
mandamus.

RULING OF THE COURT:

The court agrees with the CA that the petition for mandamus has already become moot and
academic owing to the expiration of the period intended to be covered by the business permit.

An issue or a case becomes moot and academic when it ceases to present a justiciable
controversy so that a determination thereof would be without practical use and value⁠1 or in the
nature of things, cannot be enforced.⁠2 In such cases, there is no actual substantial relief to which
the applicant would be entitled to and which would be negated by the dismissal of the petition.⁠3 As
a rule, courts decline jurisdiction over such case, or dismiss it on ground of mootness.⁠4

The objective of the petition for mandamus to compel the petitioner to grant a business permit
in favor of respondent corporation for the period 2008 to 2009 has already been superseded by the
passage of time and the expiration of the petitioner’s term as mayor. Verily then, the issue as to
whether or not the petitioner, in his capacity as mayor, may be compelled by a writ of mandamus to
release the respondent’s business permit ceased to present a justiciable controversy such that any
ruling thereon would serve no practical value. Should the writ be issued, the petitioner can no longer
abide thereby; also, the effectivity date of the business permit no longer subsists.

While the CA is not precluded from proceeding to resolve the otherwise moot appeal of the
respondent, we find that the decretal portion of its decision was erroneously couched.

The CA’s conclusions on the issue of ownership over the subject land and the invalidity of
Sangguniang Bayan Resolution No. 2007-81, aside from being unsubstantiated by convincing
evidence, can no longer be practically utilized in favor of the petitioner. Thus, the overriding and
decisive factor in the final disposition of the appeal was its mootness and the CA should have
dismissed the same along with the petition for mandamus that spawned it.

More importantly, a mayor cannot be compelled by mandamus to issue a business permit


since the exercise of the same is a delegated police power hence, discretionary in nature. This was
the pronouncement of this Court in Roble Arrastre, Inc. v. Hon. Villaflor5 where a determination was
made on the nature of the power of a mayor to grant business permits under the Local Government
Code⁠6, viz:

yaki
Central to the resolution of the case at bar is a reading of Section 444(b)(3)(iv) of the Local
Government Code of 1991, which provides, thus:

SEC. 444. The Chief Executive: Powers, Duties, Functions and Compensation.

(b) For efficient, effective and economical governance the purpose of which is the general welfare of
the municipality and its inhabitants pursuant to Section 16 of this Code, the municipal mayor shall: x x
xx

3) Initiate and maximize the generation of resources and revenues, and apply the same to the
implementation of development plans, program objectives and priorities as provided for under Section
18 of this Code, particularly those resources and revenues programmed for agroindustrial
development and country-wide growth and progress, and relative thereto, shall:

xxxx

(iv) Issue licenses and permits and suspend or revoke the same for any violation of the conditions
upon which said licenses or permits had been issued, pursuant to law or ordinance.

As Section 444(b)(3)(iv) so states, the power of the municipal mayor to issue licenses is pursuant to
Section 16 of the Local Government Code of 1991, which declares:

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.

Section 16, known as the general welfare clause, encapsulates the delegated police power to local
governments. Local government units exercise police power through their respective legislative
bodies. Evidently, the Local Government Code of 1991 is unequivocal that the municipal mayor has
the power to issue licenses and permits and suspend or revoke the same for any violation of the
conditions upon which said licenses or permits had been issued, pursuant to law or ordinance. x x x

xxxx

Section 444(b)(3)(iv) of the Local Government Code of 1991, whereby the power of the respondent
mayor to issue license and permits is circumscribed, is a manifestation of the delegated police power
of a municipal corporation. Necessarily, the exercise thereof cannot be deemed ministerial. As to the
question of whether the power is validly exercised, the matter is within the province of a writ of
certiorari, but certainly, not of mandamus.⁠7 (Citations omitted)

Indeed, as correctly ruled by the RTC, the petition for mandamus filed by the respondent is
incompetent to compel the exercise of a mayor’s discretionary duty to issue business permits.

WHEREFORE, premises considered, the Decision dated March 30, 2011 of the Court of
Appeals in CA-G.R. SP No. 112152 is hereby SET ASIDE. The Decision dated May 26, 2009 of the
Regional Trial Court of Bauang, La Union is REINSTATED.

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BUKLOD NANG MAGBUBUKID SA LUPAING RAMOS, INC., PETITIONER, VS. E. M. RAMOS
AND SONS, INC., RESPONDENT.
G.R. No. 131481, March 16 : 2011
[G.R. No. 131624]

DEPARTMENT OF AGRARIAN REFORM, PETITIONER, VS.E. M. RAMOS AND SONS, INC.,


RESPONDENT.
LEONARDO-DE CASTRO, J.:

Facts: Several parcels of unirrigated land (303.38545 hectares) were situated at


Barangay Langkaan, Dasmariñas, Cavite. Originally owned by the MAnila Golf and
Country Club, he property was aquired by the [herein repondent EMRASON] in 1965
for the purpose of developing the same into a residential subdivision known as
"Traveller's Life Homes". Municipal Council of Cavite, enacteed Municipal Ordinance
No. 1, hereinafter referred to as Ordinance No. 1, entitled "An Ordinance Providing
Subdivision Regulation and Providing Penalties for Violation Thereof."E.M. Ramos and
Sons, Inc., applied for an authority to convert and development its aforementioned
372-hectare property into a residential subdivision, ataching to the application
detailed development plans and development proposals from Bancom
Development Corporation and San Miguel Corporation. On June 15. 1988, Republic
Act No. 6657, otherwise known as the Comprehensive Agrarian Reform Law or CARL,
took effect, ushering in a new process of land classification, acquisition and
distribution.
Secretary Benjamin Leong sent out the first of four batches of notices of acquisition to
EMARSON.EMRASON] filed with the Department of Agrarian Reform Adjudication
Board (DARAB), Region IV, Pasig, Metro Manila, separate petitions to nullify the first
three sets of the above notices. Legal Division of DAR rendered a decision declaring
as null and void all the notices of acquisitions. At this juncture, the DAR had already
prepared Certificates of Land Ownership Award (CLOAs) to distribute the subject
property to farmer-beneficiaries. However, on appeal, the writ of preliminary
injunction issued by the Court of Appeals enjoined the release of the CLOAs The
Court of Appeals allowed the intervention of Buklod because -the latter's
participation was "not being in any way prejudicial to the interest of the original
parties, nor will such intervention change the factual legal complexion of the case."
The Court of Appeals further observed that the subject property has never been
devoted to any agricultural activity. thus, CA granted the petition.

Issue: whether or not the subject property is within the coverage of CARP

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Ruling: No. The Supreme Court held that CARP coverage is limited to agricultural
land. More specifically, the following lands are covered by the CARP:(a) All alienable
and disposable lands of the public domain devoted to or suitable for agriculture.;(b)
All lands of the public domain in excess of the specific limits as determined by
Congress in the preceding paragraph;(c) All other lands owned by the Government
devoted to or suitable for agriculture; and(d) All private lands devoted to or suitable
for agriculture regardless of the agricultural products raised or that can be raised
thereon.Section 3(c), Chapter I of the CARL further narrows down the definition of
agricultural land that is subject to CARP to "land devoted to agricultural activity as
defined in this Act and not classified as mineral, forest, residential, commercial or
industrial land."The CARL took effect on June 15, 1988. To be exempt from the CARP,
the subject property should have already been reclassified as residential prior to said
date.furher, LGUs are empowerd to have zonal classification. Zoning classification is
an exercise by the local government of police power, not the power of eminent
domain. 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. Since the land was
already reclassified before the CARL tooke effect, it will not therefore be included
under the coverage of the law.
the SC denied the petition.

LOCGOV - 011
Buklod ng Magbubukid sa Lupaing Ramos, Inc. v. E.M. Ramos and Sons, Inc. (2011)

Doctrine: A state may not impair vested rights by legislative enactment, by the enactment or by the subsequent repeal of
a municipal ordinance, or by a change in the constitution of the State, except in a legitimate exercise of the police power.

Facts: (WARNING: It’s a lengthy case.)


- Nature: Consolidated Petitions for Review on Certiorari filed by the Buklod ng Magbubukid Sa Lupaing Ramos,
Inc. (Buklod) and the Department of Agrarian Regorm (DAR), assailing a decision of the Court of Appeals in which
it declared the parcels of land owned by E.M. Ramos and Sons, Inc. (EMRASON) in Cavite exempt from the
coverage of the Comprehensive Agrarian Reform Program (CARP), thus, nullifying and setting aside the Decision
of the Office of the President.
- Several parcels of unirrigated land which form part of a larger expanse originally owned by the Manila Golf and
Country Club was aquired by EMRASON for the purpose of developing the same into a residential subdivision
known as "Traveller's Life Homes".
- The Municipal Council of Dasmariñas, Cavite, acting pursuant to Republic Act No. 2264, otherwise known as the
"Local Autonomy Act", enacted Municipal Ordinance No. 1 entitled "An Ordinance Providing Subdivision
Regulation and Providing Penalties for Violation Thereof." EMRASON applied for an authority to convert and
development its property into a residential subdivision. Them Municipal Council of Dasmariñas, Cavite passed
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Municipal Ordinance No. 29-A approving EMRASON's application.
- The actual implementation of the subdivision project suffered delay because the property was mortgaged to,
and the titles thereto were in the possession of, the Overseas Bank of Manila, which during the period material
was under liquidation.
- On June 15. 1988, Republic Act No. 6657, otherwise known as the Comprehensive Agrarian Reform Law or CARL,
took effect, ushering in a new process of land classification, acquisition and distribution. Then came the Aquino
government's plan to convert the tenanted neighboring property of the National Development Company (NDC)
into an industrial estate to be managed through a joint venture scheme by NDC and the Marubeni Corporation.
Part of the overall conversion package called for providing the tenant-farmers, opting to remain at the NDC
property, with three hectares each. However, the size of the NDC property turned out to be insufficient for both
the demands of the proposed industrial project as well as the government's commitment to the tenant-farmers.
To address this commitment, the Department of Agrarian Reform (DAR) was thus tasked with acquiring
additional lands from the nearby areas. The DAR earmarked for this purpose the subject property of EMRASON.
DAR Secretary Benjamin Leong sent out the first of four batches of notices of acquisition, each of which drew
protest from EMRASON.
- EMRASON filed with the DARAB separate petitions to nullify the notices. The Legal Division of DAR rendered a
decision declaring as null and void all the notices of acquisitions, observing that the property covered thereby is,
pursuant to Department of Justice (DOJ) Opinion No. 44, series of 1990, exempt from CARP. Supposedly, this
was pursuant to a DOJ Opinion rendered by then Justice Secretary Franklin Drilon, clarifying that lands already
converted to non-agricultural uses before June 15, 1988 were no longer covered by CARP.
- Region IV DAR Regional Director motu propio elevated the case to the Office of the Agrarian Reform Secretary.
DAR Secretary Ernesto Garilao issued an order affirming the Notices of Acquisition  MR denied -> Appeal to
the Office of the President
- Appeal dismissed by OP because EMRASON’s property has supposedly remained agricultural in classification and
thus within the coverage of the CARP because it failed to comply with the mandatory requirements and
conditions of Municipal Ordinance Nos. 1 and 29-A, specifically, among others, the need for approval of the
National Planning Commission through the Highway District Engineer, and the Bureau of Lands before final
submission to the Municipal Council and Municipal Mayor, and there was a certification of the Human
Settlements Regulatory Commission (HSRC) in 1981 and the Housing and Land Use Regulatory Board (HLRB) in
1992 that the property is agricultural  MR denied  Petition for Review with the CA
- DAR had already prepared Certificates of Land Ownership Award (CLOAs) to distribute the subject property to
farmer-beneficiaries. However, a writ of preliminary injunction issued by the Court of Appeals enjoined the
release of the CLOAs. Buklod, on behalf of the alleged 300 farmer-beneficiaries of the subject property, filed a
Manifestation and Omnibus Motion, wherein it moved that it be allowed to intervene as an indispensable party.
- Court of Appeals ruled in favor of EMRASON because the subject property was already converted/classified as
residential by the Municipality of Dasmariñas prior to the effectivity of the CARL. The appellate court reasoned
mainly that “…the municipality, conformably with its statutory-conferred local autonomy, had passed a
subdivision measure, I.e., Ordinance No. 1, and had approved in line thereto, through the medium of Ordinance
No. 29-A, [EMRASON's] application for subdivision, or with like effect approved the conversion/classification of
the lands in dispute as residential. Significantly, the Municipal Mayor of Dasmariñas, Cavite, in his letter of
September 23, 1988 to [EMRASON], clarified that such conversion conforms with the approved development
plan of the municipality”. (If interested in the discussion at CA level, please read the case)

Petitioner’s arguments:
- DAR:
o The subject property could be compulsorily acquired by the State from EMRASON and distributed to
qualified farmer-beneficiaries under the CARP since it was still agricultural land when the CARP became
effective on June 15, 1988. Ordinance Nos. 1 and 29-A, approved by the Municipality of Dasmariñas on
July 13, 1971 and July 9, 1972, respectively, did not reclassify the subject property from agricultural to
non-agricultural. The power to reclassify lands is an inherent power of the National Legislature under
Section 9 of Commonwealth Act No. 141, otherwise known as the Public Land Act, as amended,
which, absent a specific delegation, could not be exercised by any local government unit (LGU). The
Local Autonomy Act of 1959 - in effect when the Municipality of Dasmariñas approved Ordinance Nos.
1 and 29-A - merely delegated to cities and municipalities zoning authority, to be understood as the
regulation of the uses of property in accordance with the existing character of the land and structures.
It was only Section 20 of Republic Act No. 7160, otherwise known as the Local Government Code of
1991, which extended to cities and municipalities limited authority to reclassify agricultural lands.
o Even conceding that cities and municipalities were already authorized in 1972 to issue an ordinance
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reclassifying lands from agricultural to non-agricultural, Ordinance No. 29-A of the Municipality of
Dasmariñas was not valid since it failed to comply with Section 3 of the Local Autonomy Act of 1959,
Section 16(a) of Ordinance No. 1 of the Municipality of Dasmarinas, and Administrative Order No.
152, which all required review and approval of such an ordinance by the National Planning Commission
(NPC). Subsequent developments further necessitated review and approval of Ordinance No. 29-A by
the Human Settlements Regulatory Commission (HSRC), which later became the Housing and Land Use
Regulatory Board (HLURB).
o Reliance by the Court of Appeals on Natalia Realty, Inc. v. Department of Agrarian Reform is misplaced
because the lands involved therein were converted from agricultural to residential use by Presidential
Proclamation No. 1637, issued pursuant to the authority delegated to the President under Section 71,
et seq., of the Public Land Act.
- Buklod:
o Prior to Ordinance Nos. 1 and 29-A, there were already laws implementing agrarian reform, particularly:
(1) Republic Act No. 3844, otherwise known as the Agricultural Land Reform Code, in effect since
August 8, 1963, and subsequently amended by Republic Act No. 6389 on September 10, 1971, after
which it became known as the Code of Agrarian Reforms; and (2) Presidential Decree No. 27,
otherwise known as the Tenants Emancipation Decree, which took effect on November 19, 1972.
Agricultural land could not be converted for the purpose of evading land reform for there were already
laws granting farmer-tenants security of tenure, protection from ejectment without just cause, and
vested rights to the land they work on.
o EMRASON failed to comply with Section 36 of the Code of Agrarian Reforms, which provided that the
conversion of land should be implemented within one year, otherwise, the conversion is deemed in bad
faith. Given the failure of EMRASON to comply with many other requirements for a valid conversion,
the subject property has remained agricultural. Simply put, no compliance means no conversion. In
fact, Buklod points out, the subject property is still declared as "agricultural" for real estate tax
purposes. Consequently, EMRASON is now estopped from insisting that the subject property is actually
"residential."
o Land reform is a constitutional mandate which should be given paramount consideration. Pursuant to
said constitutional mandate, the Legislature enacted the CARP. It is a basic legal principle that a
legislative statute prevails over a mere municipal ordinance.  ARGUMENT MOST RELEVANT TO THE
TOPIC

Respondent’s arguments:
- EMRASON:
o The subject property is exempt from CARP because it had already been reclassified as residential with
the approval of Ordinance No. 29-A by the Municipality. EMRASON cites Ortigas & Co., Ltd.
Partnership v. Feati Bank and Trust Co where this Court ruled that a municipal council is empowered to
adopt zoning and subdivision ordinances or regulations under Section 3 of the Local Autonomy Act of
1959. EMRASON avows that the Municipality of Dasmariñas, taking into account the conditions
prevailing in the area, could validly zone and reclassify the subject property in the exercise of its police
power in order to safeguard the health, safety, peace, good order, and general welfare of the people in
the locality. EMRASON describes the whole area surrounding the subject property as residential
subdivisions (i.e., Don Gregorio, Metro Gate, Vine Village, and Cityland Greenbreeze 1 and 2
Subdivisions) and industrial estates (i.e., Reynolds Aluminum Philippines, Inc. factory; NDC-Marubeni
industrial complex, San Miguel Corporation-Monterey cattle and piggery farm and slaughterhouse),
traversed by national highways (i.e., Emilio Aguinaldo National Highway, Trece Martirez, Puerto Azul
Road, and Governor's Drive). EMRASON mentions that on March 25, 1988, the Sangguniang
Panlalawigan of the Province of Cavite passed Resolution No. 105 which declared the area where
subject property is located as "industrial-residential-institutional mix."
o Ordinance No. 29-A of the Municipality of Dasmariñas is valid. Ordinance No. 29-A is complete in itself,
and there is no more need to comply with the alleged requisites which DAR and Buklod are insisting
upon. EMRASON quotes from Patalinghug v. Court of Appeals that "once a local government has
reclassified an area as commercial, that determination for zoning purposes must prevail."
o Ordinance No. 29-A, reclassifying the subject property, was approved by the Municipality of Dasmariñas
on July 9, 1972. Executive Order No. 648, otherwise known as the Charter of the Human Settlements
Regulatory Commission (HSRC Charter) - which conferred upon the HSRC the power and duty to
review, evaluate, and approve or disapprove comprehensive land use and development plans and
zoning ordinances of LGUs - was issued only on February 7, 1981. The exercise by HSRC of such power
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could not be applied retroactively to this case without impairing vested rights of EMRASON.
o There is no absolute necessity of submitting Ordinance No. 29-A to the NPC for approval. Based on the
language of Section 3 of the Local Autonomy Act of 1959, which used the word "may," review by the
NPC of the local planning and zoning ordinances was merely permissive. EMRASON additionally posits
that Ordinance No. 1 of the Municipality of Dasmariñas simply required approval by the NPC of the final
plat or plan, map, or chart of the subdivision, and not of the reclassification and/or conversion by the
Municipality of the subject property from agricultural to residential. As for Administrative Order No.
152 dated December 16, 1968, it was directed to and should have been complied with by the city and
municipal boards and councils. Thus, EMRASON should not be made to suffer for the non-compliance
by the Municipal Council of Dasmarinas with said administrative order.
o Since the subject property was already reclassified as residential with the mere approval of Ordinance
No. 29-A by the Municipality of Dasmarinas, EMRASON did not have to immediately undertake actual
development of the subject property. Reclassification and/or conversion of a parcel of land are different
from the implementation of the conversion.
o Buklod members are not farmer-tenants of the subject property. The subject property has no farmer-
tenants because, as the Court of Appeals observed, the property is unirrigated and not devoted to any
agricultural activity. The subject property was placed under the CARP only to accommodate the farmer-
tenants of the NDC property who were displaced by the NDC-Marubeni Industrial Project. Moreover,
the Buklod members are still undergoing a screening process before the DAR-Region IV, and are yet to
be declared as qualified farmer-beneficiaries of the subject property. Hence, Buklod members tailed to
establish they already have vested right over the subject property.

Issue/s: Whether the subject property could be placed under the CARP

Held/Ratio: SC affirms the Court of Appeals and rules in favor of EMRASON.


- CARP coverage limited to agricultural land
o Section 4, Chapter II of the CARL, as amended,24 particularly defines the coverage of the CARP, to wit:
SEC. 4. Scope. - The Comprehensive Agrarian Reform Law of 1988 shall cover, regardless of tenurial
arrangement and commodity produced, all public and private agricultural lands as provided in
Proclamation No. 131 and Executive Order No. 229, including other lands of the public domain suitable
for agriculture: Provided, That landholdings of landowners with a total area of five (5) hectares and
below shall not be covered for acquisition and distribution to qualified beneficiaries. More specifically,
the following lands are covered by the CARL: (d) All private lands devoted to or suitable for agriculture
regardless of the agricultural products raised or that can be raised thereon. Section 3(c), Chapter I of
the CARL further narrows down the definition of agricultural land that is subject to CARL to "land
devoted to agricultural activity as defined in this Act and not classified as mineral, forest, residential,
commercial or industrial land." The CARL took effect on June 15, 1988. To be exempt from the CARL,
the subject property should have already been reclassified as residential prior to said date.
- The Local Autonomy Act of 1959
o The Local Autonomy Act of 1959, precursor of the Local Government Code of 1991, provided: SEC. 3.
Additional powers of provincial boards, municipal boards or city councils and municipal and regularly
organized municipal district councils. - x x x Power to adopt zoning and planning ordinances. — Any
provision of law to the contrary notwithstanding, Municipal Boards or City Councils in cities, and
Municipal Councils in municipalities are hereby authorized to adopt zoning and subdivision ordinances
or regulations for their respective cities and municipalities subject to the approval of the City Mayor or
Municipal Mayor, as the case may be. Cities and municipalities may, however, consult the National
Planning Commission on matters pertaining to planning and zoning.
o The Court observes that the OP, the Court of Appeals, and even the parties themselves referred to
Resolution No. 29-A as an ordinance. Although it may not be its official designation, calling Resolution
No. 29-A as Ordinance No. 29-A is not completely inaccurate.
 Ortigas & Co. case, the Court found it immaterial that the then Municipal Council of
Mandaluyong declared certain lots as part of the commercial and industrial zone through a
resolution, rather than an ordinance, because:Section 3 of R.A. No. 2264, otherwise known as
the Local Autonomy Act, empowers a Municipal Council "to adopt zoning and subdivision
ordinances or regulations" for the municipality. Clearly, the law docs not restrict the exercise
of the power through an ordinance. Therefore, granting that Resolution No. 27 is not an
ordinance, it certainly is a regulatory measure within the intendment or ambit of the word
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exists "(A)ny provision of law to the contrary notwithstanding x x x."
- While the subject property may be physically located within an agricultural zone under the 1981 Comprehensive
Zoning Ordinance of Dasmarinas, said property retained its residential classification. According to Section 17, the
Repealing Clause, of the 1981 Comprehensive Zoning Ordinance of Dasmarinas: "AH other ordinances, rules or
regulations in conflict with the provision of this Ordinance are hereby repealed: Provided, that rights that have
vested before the effectivity of this Ordinance shall not be impaired."
o Ayog v. Cusi, Jr.: That vested right has to be respected. It could not be abrogated by the new
Constitution. Section 2, Article XIII of the 1935 Constitution allows private corporations to purchase
public agricultural lands not exceeding one thousand and twenty-four hectares. Petitioners' prohibition
action is barred by the doctrine of vested rights in constitutional law.
o The due process clause prohibits the annihilation of vested rights. "A state may not impair vested
rights by legislative enactment, by the enactment or by the subsequent repeal of a municipal
ordinance, or by a change in the constitution of the State, except in a legitimate exercise of the police
power"
- A law enacted in the exercise of police power to regulate or govern certain activities or transactions could be
given retroactive effect and may reasonably impair vested rights or contracts. Police power legislation is
applicable not only to future contracts, but equally to Ihose already in existence. Non-impairment of contracts or
vested rights clauses will have to yield to the superior and legitimate exercise by the State of police power to
promote the health, morals, peace, education, good order, safety, and general welfare of the people, x x x.
- EMRASON mentions Resolution No. 105, Defining and Declaring the Boundaries of Industrial and Residential
Land Use Plan in the Municipalities of Imus and Parts of Dasmariflas, Carmona, Gen. Mariano Alvarez, Gen. Trias,
Silang, Tanza, Naic, Rosario, and Trece Martires City, Province o[ Cavite, approved by the Sangguniang
Panlalawigan of Cavite on March 25, 1988. The Sangguniang Panlalawigan determined that "the lands
extending from the said designated industrial areas would have greater economic value for residential and
institutional uses, and would serve the interest and welfare for the greatest good of the greatest number of
people."50 Resolution No. 105, approved by the HLURB in 1990, partly reads: Tracts of land in the Municipality
of Carmona from the People's Technology Complex to parts of the Municipality of Silang, parts of the
Municipalities of Dasmariñas, General Trias, Trece Martires City, Municipalities of Tanza and Naic forming the
strip of land traversed by the Puerto Azul Road extending two kilometers more or less from each side of the road
which are hereby declared as industrial-residential-institutional mix. (Emphases supplied.)
o There is no question that the subject property is located within the afore-described area. And even
though Resolution No. 105 has no direct bearing on the classification of the subject property prior to
the CARL - it taking effect only in 1990 after being approved by the HLURB - it is a confirmation that at
present, the subject property and its surrounding areas are deemed by the Province of Cavite better
suited and prioritized for industrial and residential development, than agricultural purposes.
- CARP exemption:
o Section 4 of R.A. 6657 provides that the CARL shall "cover, regardless of tenurial arrangement and
commodity produced, all public and private agricultural lands." As to what constitutes "agricultural
land," it is referred to as "land devoted to agricultural activity as defined in this Act and not classified as
mineral, forest, residential, commercial or industrial land." The deliberations of the Constitutional
Commission confirm this limitation. "Agricultural lands" arc only those lands which are "arable and
suitable agricultural lands" and "do not include commercial, industrial and residential lands."
o Based on the foregoing, it is clear that the undeveloped portions of the Antipolo Hills Subdivision
cannot in any language be considered as "agricultural lands." These lots were intended for residential
use. They ceased to be agricultural lands upon approval of their inclusion in the Lungsod Silangan
Reservation. Even today, the areas in question continue to be developed as a low-cost housing
subdivision, albeit at a snail's pace, x x x The enormity of the resources needed for developing a
subdivision may have delayed its completion but this does not detract from the fact that these lands
are still residential lands and outside the ambit of the CARL.

Digest by: P.M.R. Gairanod

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