Basco vs PAGCOR

Municipal Corporation Local Autonomy imperium in imperio

On July 11, 1983, PAGCOR was created under PD 1869 to enable the Government to
regulate and centralize all games of chance authorized by existing franchise or
permitted by law. Basco and four others (all lawyers) assailed the validity of the law
creating PAGCOR on constitutional grounds among others particularly citing that the
PAGCORs charter is against the constitutional provision on local autonomy.
Basco et al contend that P.D. 1869 constitutes a waiver of the right of the City of
Manila to impose taxes and legal fees; that Section 13 par. (2) of P.D. 1869 which
exempts PAGCOR, as the franchise holder from paying any tax of any kind or form,
income or otherwise, as well as fees, charges or levies of whatever nature, whether
National or Local is violative of the local autonomy principle.
ISSUE: Whether or not PAGCORs charter is violative of the principle of local
autonomy.
HELD: NO. Section 5, Article 10 of the 1987 Constitution provides:
Each local government unit shall have the power to create its own source of
revenue and to levy taxes, fees, and other charges subject to such guidelines and
limitation as the congress may provide, consistent with the basic policy on local
autonomy. Such taxes, fees and charges shall accrue exclusively to the local
government.
A close reading of the above provision does not violate local autonomy (particularly
on taxing powers) as it was clearly stated that the taxing power of LGUs are subject
to such guidelines and limitation as Congress may provide.
Further, the City of Manila, being a mere Municipal corporation has no inherent right
to impose taxes. The Charter of the City of Manila is subject to control by Congress.
It should be stressed that municipal corporations are mere creatures of Congress
which has the power to create and abolish municipal corporations due to its
general legislative powers. Congress, therefore, has the power of control over
Local governments. And if Congress can grant the City of Manila the power to tax
certain matters, it can also provide for exemptions or even take back the power.

Further still, local governments have no power to tax instrumentalities of the

National Government. PAGCOR is a government owned or controlled corporation
with an original charter, PD 1869. All of its shares of stocks are owned by the
National Government. Otherwise, its operation might be burdened, impeded or
subjected to control by a mere Local government.
This doctrine emanates from the supremacy of the National Government over
local governments.

MMDA v Bel-Air Village Association, Inc.

GR 135962
March 27, 2000
FACTS:
On December 30, 1995, respondent received from petitioner a notice requesting the
former to open its private road, Neptune Street, to public vehicular traffic starting
January 2, 1996. On the same day, respondent was apprised that the perimeter
separating the subdivision from Kalayaan Avenue would be demolished.
Respondent instituted a petition for injunction against petitioner, praying for the
issuance of a TRO and preliminary injunction enjoining the opening of Neptune
Street and prohibiting the demolition of the perimeter wall.
ISSUE:
WON MMDA has the authority to open Neptune Street to public traffic as an agent of
the state endowed with police power.
HELD:
A local government is a political subdivision of a nation or state which is
constituted by law and has substantial control of local affairs. It is a body politic
and corporate one endowed with powers as a political subdivision of the National
Government and as a corporate entity representing the inhabitants of its territory
(LGC of 1991).
Our Congress delegated police power to the LGUs in Sec.16 of the LGC of 1991. It
empowers the sangguniang panlalawigan, panlungsod and bayan to enact
ordinances, approve resolutions and appropriate funds for the general
welfare of the [province, city or municipality] and its inhabitants pursuant
to Sec.16 of the Code and in the proper exercise of the [LGU's corporate powers]
provided under the Code.

There is no syllable in RA 7924 that grants the MMDA police power, let
alonelegislative power. Unlike the legislative bodies of the LGUs, there is no grant of
authority in RA 7924 that allows the MMDA to enact ordinances and regulations for
the general welfare of the inhabitants of Metro Manila. The MMDA is merely a
development authority and not a political unit of government since it is neither an
LGU or a public corporation endowed with legislative power. The MMDA Chairman is
not an elective official, but is merely appointed by the President with the rank and
privileges of a cabinet member.
In sum, the MMDA has no power to enact ordinances for the welfare of the
community. It is the LGUs, acting through their respective legislative
councils, that possess legislative power and police power.
The Sangguniang Panlungsod of Makati City did not pass any ordinance or resolution
ordering the opening of Neptune Street, hence, its proposed opening by the MMDA
is illegal.

Province of Batangas vs. Romulo

GR 152774
May 27, 2004
FACTS:
In 1998, then President Estrada issued EO No. 48 establishing the Program for
Devolution Adjustment and Equalization to enhance the capabilities of LGUs in the
discharge of the functions and services devolved to them through the LGC.
The Oversight Committee under Executive Secretary Ronaldo Zamora passed
Resolutions No. OCD-99-005, OCD-99-006 and OCD-99-003 which were approved by
Pres. Estrada on October 6, 1999. The guidelines formulated by the Oversight
Committee required the LGUs to identify the projects eligible for funding under the
portion of LGSEF and submit the project proposals and other requirements to the
DILG for appraisal before the Committee serves notice to the DBM for the
subsequent release of the corresponding funds.
Hon. Herminaldo Mandanas, Governor of Batangas, petitioned to declare
unconstitutional and void certain provisos contained in the General Appropriations
Acts (GAAs) of 1999, 2000, and 2001, insofar as they uniformly earmarked for each
corresponding year the amount of P5billion for the Internal Revenue Allotment (IRA)

for the Local Government Service Equalization Fund (LGSEF) & imposed conditions
for the release thereof.
ISSUE:
Whether the assailed provisos in the GAAs of 1999, 2000, and 2001, and the OCD
resolutions infringe the Constitution and the LGC of 1991.
HELD:
Yes.
The assailed provisos in the GAAs of 1999, 2000, and 2001, and the OCD resolutions
constitute a withholding of a portion of the IRA they effectively encroach on the
fiscal autonomy enjoyed by LGUs and must be struck down.
According to Art. II, Sec.25 of the Constitution, the State shall ensure the
local autonomy of local governments. Consistent with the principle of local
autonomy, the Constitution confines the Presidents power over the LGUs to one
of general supervision, which has been interpreted to exclude the power of
control. Drilon v. Lim distinguishes supervision from control: control lays down
the rules in the doing of an act the officer has the discretion to order his
subordinate to do or redo the act, or decide to do it
himself; supervision merely sees to it that the rules are followed but has no
authority to set down the rules or the discretion to modify/replace them.
The entire process involving the distribution & release of the LGSEF is
constitutionally impermissible. The LGSEF is part of the IRA or just share of the
LGUs in the national taxes. Sec.6, Art.X of the Constitution mandates that the
just shareshall be automatically released to the LGUs. Since the release
is automatic, theLGUs arent required to perform any act to receive the just
share it shall bereleased to them without need of further action. To subject its
distribution & release to the vagaries of the implementing rules & regulations as
sanctioned by the assailed provisos in the GAAs of 1999-2001 and the OCD
Resolutions would violate this constitutional mandate.
The only possible exception to the mandatory automatic release of the LGUs IRA is if
the national internal revenue collections for the current fiscal year is less than 40%
of the collections of the 3rd preceding fiscal year. The exception does not apply in
this case.

The Oversight Committees authority is limited to the implementation of the LGC of

1991 not to supplant or subvert the same, and neither can it exercise control over
the IRA of the LGUs.
Congress may amend any of the provisions of the LGC but only through a separate
law and not through appropriations laws or GAAs. Congress cannot include in a
general appropriations bill matters that should be more properly enacted
in a separate legislation.
A general appropriations bill is a special type of legislation, whose content is limited
to specified sums of money dedicated to a specific purpose or a separate fiscal
unit any provision therein which is intended to amend another law is considered an
inappropriate provision. Increasing/decreasing the IRA of LGUs fixed in the LGC
of 1991 are matters of general & substantive law. To permit the Congress to
undertake these amendments through the GAAs would unduly infringe the fiscal
autonomy of the LGUs.
The value of LGUs as institutions of democracy is measured by the degree
of autonomy they enjoy. Our national officials should not only comply with the
constitutional provisions in local autonomy but should also appreciate the spirit and
liberty upon which these provisions are based.
Sultan Osop Camid vs. The Office of the President
Posted on September 11, 2012
Sultan Osop Camid vs. The office of the President
G.R. No. 161414 January 14, 2005
Facts:
The municipality of Andong, Lanao del Sur, is a town that is not supposed to exist
yet is actually insisted by some as alive and thriving. The creation of the putative
municipality was declared void ab initio by the Supreme Court four decades ago, but
the present petition insists that Andong thrives on and, hence, its legal personality
should be given judicial affirmation.
xxx
The factual antecedents derive from the ruling in Pelaez vs.Auditor General in 1965.
Then President Diosdado Macapagal issued several Executive Orders creating 33
municipalities in Mindanao.
President Macapagal justified the creation of these municipalities citing his powers
under Sec.68 of the Revised Admin. Code. Then VP Emmanuel Pelaez filed a special

civil action for a writ of prohibition alleging that the EOs were null and void, Sec. 68
having been repealed by RA 2370, and said orders constituting an undue delegation
of legislative power.
After due deliberation, the SC ruled that the challenged EOs were null and void
since Sec. 68 of the Revised Admin. Code did not meet the well-settled
requirements for a valid delegation of legislative power to the executive branch.
Among the EOs annulled was EO 107 which created the Municipality of Andong.
Petitioner represents himself as a current resident of Andong and alleged that
Andong has metamorphosed into a full-blown municipality with a complete set of
officials appointed to handle essential services for the municipality and its
constituents, despite the fact that no person has been appointed, elected or
qualified to serve any of the local government offices of Andong since 1968.
Camid imputed grave abuse of discretion on the part of DILG in not classifying
[Andong] as a regular existing municipality and in not including said municipality in
its records and official database as [an] existing regular municipality. He argues
thatPelaez has already been modified by supervening events consisting of
subsequent laws and jurisprudence, particularly citing Municipality of San Narciso v.
Hon. Mendezwherein the court affirmed the unique status of the Municipality of San
Andres as a de facto municipal corporation. Camid also cites Sec. 442(d) of the
Local Government Code of 1991 as basis for the recognition of the impugned
municipality.
Issue:
Whether the judicial annulment of the Municipality of Andong continues despite the
petitioners allegation that Andong has thrived into a full-blown municipality
Held:
Municipal corporations may exist by prescription where it is shown that the
community has claimed and exercised corporate functions with the knowledge and
acquiescence of the legislature, and without interruption or objection for period long
enough to afford title by prescription. What is clearly essential is a factual
demonstration of the continuous exercise by the municipal corporation of its
corporate powers, as well as the acquiescence thereto by instrumentalities of the
state. Camids plaint should have undergone the usual administrative gauntlet and,
once that was done, should have been filed first with the Court of Appeals, which at
least would have had the power to make the necessary factual
determinations. Petitioners seeming ignorance of the principles of exhaustion of

administrative remedies and hierarchy of courts, as well as the concomitant

prematurity of the present petition, cannot be countenanced.
The question as to whether a municipality previously annulled by the Supreme
Court may attain recognition in the absence of any curative/reimplementing statute
has never been decided before. The effect of Sec. 442(d) of the Local Government
Code on municipalities such as Andong warrants explanation.
EO 107 which established Andong was declared null and void ab initio in 1965 by
the Supreme Court in Pelaez vs. Auditor General, 15 SCRA 569 (1965), along with
33 other EOs. The phrase ab initio means from the beginning. Pelaez was never
reversed by the SC but was rather expressly affirmed in the cases of Municipality of
San Joaquin v. Siva, Municipality of Malabang v. Benito, and Municipality of Kapalong
v. Moya. No subsequent ruling declared Pelaez as overturned/inoperative. No
subsequent legislation has been passed since 1965 creating the Municipality of
Andong. Given these facts, there is hardly any reason to elaborate why Andong
does not exist as a duly constituted municipality.
Pelaez and its offspring cases ruled that the President has no power to create
municipalities yet limited its nullificatory effects to the particular municipalities
challenged in actual cases before this Court. With the promulgation of the LGC in
1991, the legal cloud was lifted over the municipalities similarly created by
executive order but not judicially annulled Sec. 442(b) of the LGC deemed curative
whatever legal defects to title these municipalities had labored under.
There are eminent differences between Andong and municipalities such as San
Andres, Alicia and Sinacaban. Most prominent is the fact that the EO creating
Andong was expressly annulled by the SC in 1965. Court decisions cannot lose their
efficacy due to sheer defiance by the parties aggrieved.
Sec. 442(d) of the LGC does not serve to affirm/reconstitute the judicially dissolved
municipalities which had been previously created by presidential
issuances/EOs. The provision only affirms the legal personalities of those
municipalities which may have been created using the same infirm legal basis, yet
were fortunate enough not to have been judicially annulled. On the other hand, the
municipalities judicially dissolved remain inexistent unless recreated through
specific legislative enactments.
The legal effect of the nullification of a municipality in Pelaez was to revert the
constituent barrios of the voided town back to their original municipalities.

If there is only a strong impulse for the reconstitution of the municipality nullified
inPelaez, the solution is through the legislature and not judicial confirmation of void
title.The time has come for the light to seep in and for the petitioner and
like-minded persons to awaken to legal reality.

League of Cities v. Comelec

Action:
These are consolidated petitions for prohibition with prayer for the issuance of a writ
of preliminary injunction or temporary restraining order filed by the League of Cities
of the Philippines, City of Iloilo, City of Calbayog, and Jerry P. Treas assailing the
constitutionality of the subject Cityhood Laws and enjoining the Commission on
Elections (COMELEC) and respondent municipalities from conducting plebiscites
pursuant to the Cityhood Laws.
Fact:
During the 11th Congress, Congress enacted into law 33 bills converting 33
municipalities into cities. However, Congress did not act on bills converting 24 other
municipalities into cities.
During the 12th Congress, Congress enacted into law Republic Act No. 9009 (RA
9009), which took effect on 30 June 2001. RA 9009 amended Section 450 of the
Local Government Code by increasing the annual income requirement for
conversion of a municipality into a city from P20 million to P100 million. The
rationale for the amendment was to restrain, in the words of Senator Aquilino
Pimentel, the mad rush of municipalities to convert into cities solely to secure a
larger share in the Internal Revenue Allotment despite the fact that they are
incapable of fiscal independence.
After the effectivity of RA 9009, the House of Representatives of the 12th Congress
adopted Joint Resolution No. 29, which sought to exempt from the P100 million
income requirement in RA 9009 the 24 municipalities whose cityhood bills were not
approved in the 11th Congress. However, the 12th Congress ended without the
Senate approving Joint Resolution No. 29.
During the 13th Congress, the House of Representatives re-adopted Joint Resolution
No. 29 as Joint Resolution No. 1 and forwarded it to the Senate for approval.
However, the Senate again failed to approve the Joint Resolution. Following the
advice of Senator Aquilino Pimentel, 16 municipalities filed, through their respective
sponsors, individual cityhood bills. The 16 cityhood bills contained a common

provision exempting all the 16 municipalities from the P100 million income
requirement in RA 9009.
On 22 December 2006, the House of Representatives approved the cityhood bills.
The Senate also approved the cityhood bills in February 2007, except that of Naga,
Cebu which was passed on 7 June 2007. The cityhood bills lapsed into law (Cityhood
Laws) on various dates from March to July 2007 without the Presidents signature.
The Cityhood Laws direct the COMELEC to hold plebiscites to determine whether the
voters in each respondent municipality approve of the conversion of their
municipality into a city.
Petitioners filed the present petitions to declare the Cityhood Laws unconstitutional
for violation of Section 10, Article X of the Constitution, as well as for violation of the
equal protection clause. Petitioners also lament that the wholesale conversion of
municipalities into cities will reduce the share of existing cities in the Internal
Revenue Allotment because more cities will share the same amount of internal
revenue set aside for all cities under Section 285 of the Local Government Code.
Issue:
The petitions raise the following fundamental issues:
1. Whether the Cityhood Laws violate Section 10, Article X of the Constitution; and
2. Whether the Cityhood Laws violate the equal protection clause.
Held:
We grant the petitions.
The Cityhood Laws violate Sections 6 and 10, Article X of the Constitution, and are
thus unconstitutional.
First, applying the P100 million income requirement in RA 9009 to the present case
is a prospective, not a retroactive application, because RA 9009 took effect in 2001
while the cityhood bills became law more than five years later.
Second, the Constitution requires that Congress shall prescribe all the criteria for
the creation of a city in the Local Government Code and not in any other law,
including the Cityhood Laws.
Third, the Cityhood Laws violate Section 6, Article X of the Constitution because
they prevent a fair and just distribution of the national taxes to local government
units.

Fourth, the criteria prescribed in Section 450 of the Local Government Code, as
amended by RA 9009, for converting a municipality into a city are clear, plain and
unambiguous, needing no resort to any statutory construction.
Fifth, the intent of members of the 11th Congress to exempt certain municipalities
from the coverage of RA 9009 remained an intent and was never written into
Section 450 of the Local Government Code.
Sixth, the deliberations of the 11th or 12th Congress on unapproved bills or
resolutions are not extrinsic aids in interpreting a law passed in the 13th Congress.
Seventh, even if the exemption in the Cityhood Laws were written in Section 450 of
the Local Government Code, the exemption would still be unconstitutional for
violation of the equal protection clause.
TAN vs. COMELEC
G.R. No. 73155 July 11, 1986
Governing law: Art XI Sec. 3 of Constitution in relation to Sec. 197 of Local
Government Code
Facts:
This case was prompted by the enactment of Batas Pambansa Blg. 885, An Act
Creating a New Province in the Island of Negros to be known as the Province of
Negros del Norte, effective Dec. 3, 1985. (Cities of Silay, Cadiz and San Carlos and
the municipalities of Calatrava, Taboso, Escalante, Sagay, Manapla, Victorias, E.R.
Magalona, and Salvador Benedicto proposed to belong to the new province).
Pursuant to and in implementation of this law, the COMELEC scheduled a plebiscite
for January 3, 1986. Petitioners opposed, filing a case for Prohibition and contending
that the B.P. 885 is unconstitutional and not in complete accord with the Local
Government Code because:
The voters of the parent province of Negros Occidental, other than those living
within the territory of the new province of Negros del Norte, were not included in the
plebiscite.
The area which would comprise the new province of Negros del Norte would only
be about 2,856.56 sq. km., which is lesser than the minimum area prescribed by the
governing statute, Sec. 197 of LGC.

Issue:
WON the plebiscite was legal and complied with the constitutional requisites of the
Consititution, which states that Sec. 3. No province, city, municipality or barrio
may be created, divided, merged, abolished, or its boundary substantially altered
except in accordance with the criteria established in the Local Government Code,
and subject to the approval by a majority of the votes in a plebiscite in the unit or
units affected? NO.
Held:
Whenever a province is created, divided or merged and there is substantial
alteration of the boundaries, the approval of a majority of votes in the plebiscite in
the unit or units affected must first be obtained. The creation of the proposed new
province of Negros del Norte will necessarily result in the division and alteration of
the existing boundaries of Negros Occidental (parent province).
Plain and simple logic will demonstrate that two political units would be affected.
The first would be the parent province of Negros Occidental because its boundaries
would be substantially altered. The other affected entity would be composed of
those in the area subtracted from the mother province to constitute the proposed
province of Negros del Norte.
Paredes vs. Executive (G.R. No. 55628) should not be taken as a doctrinal or
compelling precedent. Rather, the dissenting view of Justice Abad Santos is
applicable, to wit:
when the Constitution speaks of the unit or units affected it means all of the
people of the municipality if the municipality is to be divided such as in the case at
bar or of the people of two or more municipalities if there be a merger.
The remaining portion of the parent province is as much an area affected. The
substantial alteration of the boundaries of the parent province, not to mention the
adverse economic effects it might suffer, eloquently argue the points raised by the
petitioners.
SC pronounced that the plebscite has no legal effect for being a patent nullity.
Padilla vs. COMELEC
FACTS:
Pursuant to RA 7155, creating the Municipality of Tulay na Lupa in the province of

Camarines Norte to be composed of Barangays Tulay-naLupa, Lugui, San Antonio,

Mabilo I, Napaod, Bayan-bayn, Mataulang, Pag-asa, Maot, and Calabasa, all in the
Municipalty of Labo, some province, COMELEC scheduled a plebiscite was
conducted throughout the municipality of Labo and majority voted against the
creation of the Municipality of Tulay-na-Lupa. Petitioner prayed that the plebiscite
conducted to set aside with the contention that such plebiscite was a complete
failure.
ISSUE:
Whether or not the plebiscite conducted in the areas comprising the proposed
Municipality of Tulay na Lupa and the remaining areas of the mother Municipality of
Labo is valid.
RULING:
COMELEC did not commit grave abuse of discretion and the result of the plebiscite
rejecting the creation of the new municipality of Tulay-na-Lupa is valid.
It stands to reason that when the law states that the plebiscite shall be conducted
in the political units directly affected, it means that residents of the political entity
who would be economically dislocated by the separation of a portion thereof have a
right to vote in said plebiscite. Evidently, what is contemplated by the phrase
political units directly affected is the plurality of the political units which would
participate in the plebiscite.
Grio vs. COMELEC
G.R. No. 105120 September 2, 1992
FACTS:
Grio and his LDP political party filed a certiorari case against COMELEC in relation
to the May 11, 1992 election. Grio is a candidate for Governor of Iloilo where
the sub-province of Guimaras is located. LGC of 1991 took effect requiring the
conversion of existing sub-provinces into regular provinces, and Guimaras is one
such sub-provinces, upon approval by majority of votes cast in a plebiscite. The
plebiscite favored the conversion of Guimaras into a regular province but
petitioner questioned the COMELEC that ballots should have contained spaces to
allow voting for Gov, Vice Gov and members of the Sanggunian of Iloilo.
ISSUE:
Whether or not there was a complete failure of election in Guimaras.
HELD:
The court held that COMELEC was under mistaken presumption that under the LGC
of 1991, whether or not the conversion of Guimaras into a regular province is
ratified by the people in plebiscite, the President will appoint provincial officials.
However, the voters favored for the conversion of Guimaras into a regular province

so there was need to undo what COMELEC has done in plebiscite. There ballots in
Guimaras should have contained spaces for Gov and Vice Gov. etc. but SC has now
considered the case moot and academic since majority voted in the affirmative for
the conversion of Guimaras.
Malabang vs Benito
FACTS:Municipality of Balabagan was once part of the Municipality of Malabang
before it was created into a separate municipality thruan executive order. The
Municipality Malabang filed a suit against the Municipality of Balabagan for having
been created under an invalid EO 386 andto restrain the respondent municipal
officials from performing thefunctions of their respective offices.Petitioner relied on
the ruling of the Pelaez case that Sec. 68 of the Administrative Code is
unconstitutional (a) because itconstitutes an undue delegation of legislative power
and (b)because it offends against Section 10 (1) of Article VII of theConstitution,
which limits the President's power over localgovernments to mere
supervision.Section 68 of the Revised Administrative Code, approved onMarch 10,
1917, must be deemed repealed by the subsequentadoption of the Constitution, in
1935, which is utterlyincompatible and inconsistent with said statutory
enactment. The Respondents on the other hand argue that the Mun. of Balabagan
is at least a de facto corporation for having beenorganized under color of a statute
before this was declaredunconstitutional, its officers having been either elected
orappointed, and the municipality itself having discharged itscorporate functions for
the past five years preceding theinstitution of this action. It is contended that as a
de factocorporation, its existence cannot be collaterally attacked,although it may be
inquired into directly in an action for quowarranto at the instance of the State and
not of an individual likethe petitioner Balindong.
The method of challenging the existence of a municipalcorporation is reserved to
the State in a proceeding for quowarranto or other direct proceeding. But the rule
disallowingcollateral attacks applies only where the municipal corporation isat least
a de facto corporation. For where it is neither acorporation de jure nor de facto, but
a nullity, the rule is that itsexistence may be questioned collaterally or directly in
any actionor proceeding by any one whose rights or interests are affectedthereby,
including the citizens of the territory incorporated unlessthey are estopped by their
conduct from doing so.
ISSUE:W/O the municipality of Balabagan is a de facto corporation.
RULING:No, because there is no other valid statute to give color of authority to its
creation when EO 386 was subsequently declaredas unconstitutional. The color of
authority requisite to the organization of a de factomunicipal corporation may be:1.
A valid law enacted by the legislature.2. An unconstitutional law, valid on its face,
which has either (a)been upheld for a time by the courts or (b) not yet been
declaredvoid; provided that a warrant for its creation can be found insome other
valid law or in the recognition of its potentialexistence by the general laws or
constitution of the state.In the case at bar, there is no other law that could give
color of authority to the validity of the existence of the municpality of Balabagan
when EO 386 was later on invalidated. Hence, suchmunicipality is not a de factor
corporation.

Pelaez vs Auditor General

Political Law Sufficient Standard Test and Completeness Test
From Sept 04 to Oct 29, 1964, the President (Marcos) issued executive orders
creating 33 municipalities this is purportedly in pursuant to Sec 68 of the Revised
Administrative Code which provides that the President of the Philippines may by
executive order define the boundary, or boundaries, of any province, sub-province,
municipality, [township] municipal district or other political subdivision, and
increase or diminish the territory comprised therein, may divide any province into
one or more subprovincesThe VP Emmanuel Pelaez and a taxpayer filed a special
civil action to prohibit the auditor general from disbursing funds to be appropriated
for the said municipalities. Pelaez claims that the EOs are unconstitutional. He said
that Sec 68 of the RAC has been impliedly repealed by Sec 3 of RA 2370 which
provides that barrios may not be created or their boundaries altered nor their
names changed except by Act of Congress or of the corresponding provincial board
upon petition of a majority of the voters in the areas affected and the
recommendation of the council of the municipality or municipalities in which the
proposed barrio is situated. Pelaez argues, accordingly: If the President, under this
new law, cannot even create a barrio, can he create a municipality which is
composed of several barrios, since barrios are units of municipalities? The Auditor
General countered that only barrios are barred from being created by the President.
Municipalities are exempt from the bar and that t a municipality can be created
without creating barrios. Existing barrios can just be placed into the new
municipality. This theory overlooks, however, the main import of Pelaez argument,
which is that the statutory denial of the presidential authority to create a new barrio
implies a negation of the bigger power to create municipalities, each of which
consists of several barrios.
ISSUE: Whether or not Congress has delegated the power to create barrios to the
President by virtue of Sec 68 of the RAC.
HELD: Although

Congress may delegate to another branch of the government the

power to fill in the details in the execution, enforcement or administration of a law,

it is essential, to forestall a violation of the principle of separation of powers, that
said law: (a) be complete in itself it must set forth therein the policy to be

executed, carried out or implemented by the delegate

and (b) fix a standard

the limits of which are sufficiently determinate or determinable to which the

delegate must conform in the performance of his functions. Indeed, without a
statutory declaration of policy, the delegate would, in effect, make or formulate
such policy, which is the essence of every law; and, without the aforementioned
standard, there would be no means to determine, with reasonable certainty,
whether the delegate has acted within or beyond the scope of his authority.
`In the case at bar, the power to create municipalities is eminently legislative in
character not administrative.

G.R. No. 111097 July 20, 1994

MAYOR PABLO P. MAGTAJAS & THE CITY OF CAGAYAN DE ORO, petitioners,
vs.
PRYCE PROPERTIES CORPORATION, INC. & PHILIPPINE AMUSEMENT AND
GAMING CORPORATION,
FACTS: There was instant opposition when PAGCOR announced the opening of a
casino in Cagayan de Oro City. Civic organizations angrily denounced the
project.The trouble arose when in 1992, flush with its tremendous success in several
cities, PAGCOR decided to expand its operations to Cagayan de Oro City.he reaction
of the Sangguniang Panlungsod of Cagayan de Oro City was swift and hostile. On
December 7, 1992, it enacted Ordinance No. 3353.Nor was this all. On January 4,
1993, it adopted a sterner Ordinance No. 3375-93Pryce assailed the ordinances
before the Court of Appeals, where it was joined by PAGCOR as intervenor and
supplemental petitioner. Their challenge succeeded. On March 31, 1993, the Court
of Appeals declared the ordinances invalid and issued the writ prayed for to prohibit
their enforcement
ISSUE: WON Ordinance 3353 and 3375-93 valid
HELD: No
Local Government Code, local government units are authorized to prevent or
suppress, among others, "gambling and other prohibited games of chance."
Obviously, this provision excludes games of chance which are not prohibited but are
in fact permitted by law.The rationale of the requirement that the ordinances should
not contravene a statute is obvious.Casino gambling is authorized by P.D. 1869. This
decree has the status of a statute that cannot be amended or nullified by a mere
ordinance. Hence, it was not competent for the Sangguniang Panlungsod of
Cagayan de Oro City to enact Ordinance No. 3353 prohibiting the use of buildings
for the operation of a casino and Ordinance No. 3375-93 prohibiting the operation of
casinos. For all their praiseworthy motives, these ordinances are contrary to P.D.
1869 and the public policy announced therein and are therefore ultra vires and void.

Facts
The Sangguniang Panlungsod of Puerto Princessa enacted ordinance no. 15-92
banning the shipment of live fish and lobster outside Puerto Princessa City for a
period of 5 years. In the same light, the Sangguniang Panlalawigan of Palawan also
enacted a resolution that prohibits the catching, gathering, buying, selling and
possessing and shipment of live marine coral dwelling aquatic organisms for a
period of 5 years within the Palawan waters. The petitiones Airline Shippers
Association of Palawan together with marine merchants were charged for violating
the above ordinance and resolution by the city and provincial governments. The
petitioners now allege that they have the preferential rights as marginal fishermen
granted with privileges provided in Section 149 of the Local Government Code,
invoking the invalidity of the above-stated enactments as violative of their
preferential rights.
Issue
Whether or not the enacted resolutions and ordinances by the local government
units violative of the preferential rights of the marginal fishermen ?
Held
No, the enacted resolution and ordinance of the LGU were not violative of their
preferential rights. The enactment of these laws was a valid exercise of the police
power of the LGU to protect public interests and the public right to a balanced and
healthier ecology. The rights and privileges invoked by the petitioners are not
absolute. The general welfare clause of the local government code mandates for the
liberal interpretation in giving the LGUs more power to accelerate economic
development and to upgrade the life of the people in the community. The LGUs are
endowed with the power to enact fishery laws in its municipal waters which
necessarily includes the enactment of ordinances in order to effectively carry out
the enforcement of fishery laws in their local community.

TATEL VS. MUNICIPALITY OF VIRAC [207 SCRA 157; G.R. No. 40243; 11 Mar 1992]
Facts: Petitioner Celestino Tatel owns a warehouse in barrio Sta. Elena, Municipality
of Virac. Complaints were received by the municipality concerning the disturbance
caused by the operation of the abaca bailing machine inside petitioners warehouse.
A committee was then appointed by the municipal council, and it noted from its
investigation on the matter that an accidental fire within the warehouse of the
petitioner created a danger to the lives and properties of the people in the

neighborhood. Resolution No. 29 was then passed by the Municipal council declaring
said warehouse as a public nuisance within a purview of Article 694 of the New Civil
Code. According to respondent municipal officials, petitioners warehouse was
constructed

in

violation

of Ordinance No.

13,

series

of

1952,

prohibiting

the construction of warehouses near a block of houses either in the poblacion or

barrios without maintaining the necessary distance of 200 meters from said block of
houses to avoid loss of lives and properties by accidental fire. On the other hand,
petitioner

contends

that Ordinance No.

13

is

unconstitutional.

Issues:
(1)

Whether

or

not

petitioners

themeaning Article 694

of

warehouse
the

is

nuisance
Civil

within
Code

(2) Whether or not Ordinance No. 13, series of 1952 of the Municipality of Virac is
unconstitutional

and

void.

Held: The storage of abaca and copra in petitioners warehouse is a nuisance under
the provisions of Article 694 of the Civil Code. At the same time, Ordinance No. 13
was passed by the Municipal Council of Virac in the exercise of its police power. It is
valid because it meets the criteria for a valid municipal ordinance: 1) must not
contravene the Constitution or any statute, 2) must not be unfair or oppressive, 3)
must not be partial or discriminatory, 4) must not prohibit but may regulate trade,
5) must be general and consistent with public policy, and 6) must not be
unreasonable. The purpose of the said ordinance is to avoid the loss of property and
life in case of fire which is one of the primordial obligation of government. The lower
court did not err in its decision.

Solicitor General v Metro Manila Authority

Cruz, 1991
FACTS:InMetropolitan Traffic Command, West Traffic District vs. Hon. Arsenio M.
Gonong
, the SC ruled that (1) theconfiscation of the license plates of motor vehicles for
traffic violations was not among the sanctions that couldbe imposed by the Metro
Manila Commission under PD 1605; and, that (2) even the confiscation of
driver'slicenses for traffic violations was not directly prescribed by the decree nor
was it allowed by the decree to beimposed by the Commission.
Several complaints were filed in the SC against the confiscation by police authorities
of driver's licenses andremoval of license plates for alleged traffic violations. These
sanctions were not among those that may beimposed under PD 1605.
The Metropolitan Manila Authority issued Ordinance No. 11, Series of 1991,
authorizing itself "to detach thelicense plate/tow and impound attended/
unattended/ abandoned motor vehicles illegally parked orobstructing the flow of
traffic in Metro Manila."
oThe Metropolitan Manila Authority defended the said ordinance on the ground that
it was adoptedpursuant to the powers conferred upon it by EO 392. There was no
conflict between the decision andthe ordinance because the latter was meant to
supplement and not supplant the latter.
oThe Solicitor General expressed the view that the ordinance was null and void
because it representedan invalid exercise of a delegated legislative power. It
violated PD 1605 which does not permit, and soimpliedly prohibits, the removal of
license plates and the confiscation of driver's licenses for trafficviolations in
Metropolitan Manila.
ISSUE & HELD:
WON Ordinance No. 11 is valid (NO)
RATIO:The problem before the Court is not the validity of the delegation
of legislative power. The question the SC must resolve is the validity of the exercise
of such delegated power.
oA municipal ordinance, to be valid: 1) must not contravene the Constitution or any
statute; 2) must not be unfair or oppressive; 3) must not be partial or
discriminatory; 4) must not prohibit but may regulatetrade; 5) must not be
unreasonable; and 6) must be general and consistent with public policy.
PD 1605 does not allow either the removal of license plates or the confiscation of
driver's licenses for trafficviolations committed in Metropolitan Manila. There is
nothing in the decree authorizing the Metropolitan ManilaCommission, now the
Metropolitan Manila Authority, to impose such sanctions.
Local political subdivisions are able to legislate only by virtue of a valid delegation
of legislative power from thenational legislature (except only that the power to
create their own sources of revenue and to levy taxes isconferred by the

Constitution itself). They are mere agents vested with what is called the power of
subordinatelegislation. As delegates of the Congress, the local government unit
cannot contravene but must obey at all timesthe will of their principal. Here, the
enactments in question, which are merely local in origin, cannot prevailagainst the
decree, which has the force and effect of a statute.
The measures in question do not merely add to the requirement of PD 1605 but,
worse, impose sanctions thedecree does not allow and in fact actually prohibits.
There is no statutory authority for

and indeed there is a statutory prohibition against

the imposition of such penalties in the Metropolitan Manila area. Hence, regardless
of their merits, they cannot be imposed by thechallenged enactments by virtue only
of the delegated legislative powers.
NOTE:
SC emphasized that the ruling in the
Gonong
case that PD 1605 applies only to the Metropolitan Manila area. It isan exception to
the general authority conferred by RA 413 on the Commissioner of Land
Transportation to punishviolations of traffic rules elsewhere in the country with the
sanction therein prescribed, including those here questioned.

Binay vs. Domingo; Power of LGU

G.R. No. 92389 September 11, 1991

Facts:
Petitioner passed a resolution to confirm and/or ratify the ongoing burial
assistance program initiated by the office of the mayor, of extending financial
assistance of five hundred pesos (500.00) to a bereaved family, funds to be taken
out of unappropriated available funds existing in the municipal treasury. This
resolution was re-enacted again by a subsequent resolution.
The dispute arose when respondent issued an order disapproving the
disbursement of the City's funds pursuance to the said resolution.
The COA argued that there is "no perceptible connection or relation between the
objective sought to be attained under the assailed Resolutions, and the alleged
public safety, general welfare. etc. of the inhabitants of Makati."
Also COA alleged that the resolution violate the prohibition that government
funds must be disbursed for public purpose.

Moreover, COA alleged that there was violation of the equal protection clause,
since classifying pauper residents would be an invalid classification since there is
not substantial distinctions form the other residents of Makati.
Issue:
Whether or not the resolutions are within the power of the Sanguniang
Panglungsod of Makati.
HELD: The police power of a municipal corporation is broad, and has been said to be
commensurate with, but not to exceed, the duty to provide for the real needs of the
people in their health, safety, comfort, and convenience as consistently as may be
with private rights.xxx Ordinance is not unconstitutional merely because it
incidentally benefits a limited number of persons.xxx The support for the poor has
long been an accepted exercise of the police power in the promotion of the
common good.

Plaza II vs Cassion
Posted on November 18, 2012

GR 136809
July 27, 2004
FACTS
The City of Butuan, through its Sanggunian, passed SP Resolution 427-92
authorizing the City Mayor to sign the Memorandum of Agreement for the
Devolution of the DSWD to the City of Butuan. Pursuant to the MoA, Mayor
Plaza issued EO No. 06-92 reconstituting the City Social Services Development
Office (CSSDO), devolving or adding thereto 19 additional DSWD employees
headed by Virginia Tuazon as Officer-in-charge. Its office was transferred from
the original CSSDO building to the DSWD building.
Aggrieved by the development, Respondents refused to recognize Tuazon as
their new head & to report at the DSWD building contending that the issuance of
EO No. 06-92 & Tuazons designation as the CSSDOs Officer-in-charge are
illegal. Respondents failed to report for work despite Mayor Plazas series of
orders directing them to do so. Thereafter, they were administratively charged
for grave misconduct & insubordination and were preventively suspended for 60
days.

Upon expiration of their suspension, the respondents informed the Mayor that
they are willing to return to work but only to their old office, not the DSWD
building. They also failed to report to Tuazon at the DSWD building despite the
Mayors instructions to do so.
Mayor Plaza then dropped the respondents from the rolls pursuant to the CSC
Memorandum Circular No. 38, Series of 1993 which provides that officers
& employees who are absent for at least 30 days without approved
leavemay be dropped from the service without prior notice.
ISSUE
1. Whether EO No. 06-92 directing the devolution of 19 national DSWD
employees to the city DSWD to be headed by petitioner Tuazon should be
upheld as valid.
2. Whether private respondents were denied due process when they were
dropped from the rolls.
HELD
1. Sec.17 of the LGC authorizes the devolution of personnel, assets &
liabilities, records basic services, and facilities of a national
government agency to LGUs. Under this Code, the term devolution refers
to the act by which the government confers power and authority upon
the various LGUs to perform specific functions & responsibilities.
Mayor Plaza is empowered to issue EO No. 06-92 in order to give effect to the
devolution decreed by the LGC. As the local chief executive of Butuan
City, Mayor Plaza has the authority to reappoint devolved personnel & may
designate an employee to take charge of a department until the appointment of
a regular head.
EO No. 06-92 did not violate respondents security of tenure as they were not
transferred to another office without their consent. Transfer is a movement
from one position to another which is of equivalent rank, level or salary
without break in service & may be imposed as an administrative
penalty. The change of respondents place of work from the CSSDO to the
DSWD building is not a transfer. It was only a physical transfer of their office to a
new one done in the interest of public service.

2. Dropping from the rolls is not an administrative sanction.

Thus, private respondents need not be notified or heard. Their assertion that
they were denied due process is, therefore, untenable.

LTO vs. City of Butuan; Power of LGU

G. R. No. 131512.

January 20, 2000

Facts:
Relying on the fiscal autonomy granted to LGU's by the Constittuion and the
provisons of the Local Government Code, the Sangguniang Panglunsod of the City of
Butuan enacted an ordinance "Regulating the Operation of Tricycles-for-Hire,
providing mechanism for the issuance of Franchise, Registration and Permit, and
Imposing Penalties for Violations thereof and for other Purposes." The ordinance
provided for, among other things, the payment of franchise fees for the grant of the
franchise of tricycles-for-hire, fees for the registration of the vehicle, and fees for
the issuance of a permit for the driving thereof.
Petitioner LTO explains that one of the functions of the national government that,
indeed, has been transferred to local government units is the franchising authority
over tricycles-for-hire of the Land Transportation Franchising and Regulatory Board
("LTFRB") but not, it asseverates, the authority of LTO to register all motor vehicles
and to issue to qualified persons of licenses to drive such vehicles.
The RTC and CA ruled that the power to give registration and license for driving
tricycles has been devolved to LGU's.
Issue:
Whether or not, the registration of tricycles was given to LGU's, hence the
ordinance is a valid exercise of police power.
Ruling:
No, based on the-"Guidelines to Implement the Devolution of LTFRBs Franchising
Authority over Tricycles-For-Hire to Local Government units pursuant to the Local
Government Code"- the newly delegated powers to LGU's pertain to the franchising
and regulatory powers exercised by the LTFRB and not to the functions of the LTO
relative to the registration of motor vehicles and issuance of licenses for the driving
thereof. Corollarily, the exercised of a police power must be through a valid
delegation. In this case the police power of registering tricycles was not delegated
to the LGUs, but remained in the LTO.

Clearly unaffected by the Local Government Code are the powers of LTO under
R.A. No.4136 requiring the registration of all kinds of motor vehicles "used or
operated on or upon any public highway" in the country.
The Commissioner of Land Transportation and his deputies are empowered at
anytime to examine and inspect such motor vehicles to determine whether said
vehicles are registered, or are unsightly, unsafe, improperly marked or equipped, or
otherwise unfit to be operated on because of possible excessive damage to
highways, bridges and other infrastructures. The LTO is additionally charged with
being the central repository and custodian of all records of all motor vehicles.
Adds the Court, the reliance made by respondents on the broad taxing power of
local government units, specifically under Section 133 of the Local Government
Code, is tangential.
Police power and taxation, along with eminent domain, are inherent powers of
sovereignty which the State might share with local government units by delegation
given under a constitutional or a statutory fiat. All these inherent powers are for a
public purpose and legislative in nature but the similarities just about end there. The
basic aim of police power is public good and welfare. Taxation, in its case, focuses
on the power of government to raise revenue in order to support its existence and
carry out its legitimate objectives. Although correlative to each other in many
respects, the grant of one does not necessarily carry with it the grant of the other.
The two powers are, by tradition and jurisprudence, separate and distinct powers,
varying in their respective concepts, character, scopes and limitations.
To construe the tax provisions of Section 133 (1) of the LGC indistinctively would
result in the repeal to that extent of LTO's regulatory power which evidently has not
been intended. If it were otherwise, the law could have just said so in Section 447
and 458 of Book III of the Local Government Code in the same manner that the
specific devolution of LTFRB's power on franchising of tricycles has been provided.
Repeal by implication is not favored.
The power over tricycles granted under Section 458(a)(3)(VI) of the Local
Government Code to LGUs is the power to regulate their operation and to grant
franchises for the operation thereof. The exclusionary clause contained in the tax
provisions of Section 133 (1) of the Local Government Code must not be held to
have had the effect of withdrawing the express power of LTO to cause the
registration of all motor vehicles and the issuance of licenses for the driving thereof.
These functions of the LTO are essentially regulatory in nature, exercised pursuant
to the police power of the State, whose basic objectives are to achieve road safety
by insuring the road worthiness of these motor vehicles and the competence of
drivers prescribed by R. A. 4136. Not insignificant is the rule that a statute must not
be construed in isolation but must be taken in harmony with the extant body of

laws.
LGUs indubitably now have the power to regulate the operation of tricycles-forhire and to grant franchises for the operation thereof, and not to issue registration.
Ergo, the ordinance being repugnant to a statute is void and ultra vires.

[ G.R. NO. 193677, SEPTEMBER 06, 2011 ]

LUCIANO VELOSO, ABRAHAM CABOCHAN, JOCELYN DAWISASUNCION AND MARLON M. LACSON, PETITIONERS,
VS. COMMISSION ON AUDIT, RESPONDENT.
FACTS:
On December 7, 2000, the City Council of Manila enacted Ordinance No. 8040 entitled An
Ordinance Authorizing the Conferment of Exemplary Public Service Award to Elective Local Officials of
Manila Who Have Been Elected for Three (3) Consecutive Terms in the Same Position. Section 2
thereof provides:
SEC. 2. The EPSA shall consist of a Plaque of Appreciation, retirement and gratuity pay
remuneration equivalent to the actual time served in the position for three (3) consecutive terms, subject
to the availability of funds as certified by the City Treasurer. .xxx..
Pursuant to the ordinance, the City made partial payments to some former city councilors
including herein petitioners the total amount of P9,923,257.00.
The Director, Legal and Adjudication Office (LAO)-Local of the COA issued ND No. 06-010-10005 dated May 24, 2006.
The COA sustained the Notice of Disallowance
ISSUE:
(1) Whether the COA has the authority to disallow the disbursement of local government funds
(2) Whether the COA committed grave abuse of discretion in affirming the disallowance of
P9,923,257.00 covering the EPSA of former three-term councilors of the City of Manila authorized by
Ordinance No. 8040.
RULING:
Under the 1987 Constitution, however, the COA is vested with the authority to determine whether
government entities, including LGUs, comply with laws and regulations in disbursing government funds,
and to disallow illegal or irregular disbursements of these funds.
Thus, LGUs, though granted local fiscal autonomy, are still within the audit jurisdiction of the
COA.
However, in line with existing jurisprudence, we need not require the refund of the disallowed
amount because all the parties acted in good faith.

LEPANTO CONSOLIDATED MINING COMPANY

VS. AMBANLOC- LOCAL BUSINESS TAXATION

FACTS:
Lepanto Consolidated Mining had a mining lease contract for a mining claim in Benguet. They used
the sand and gravel mined to construct and maintain concrete structures needed in its mining
operations such as a tailings dam, access roads, and offices. The provincial treasurer of Benguet
then asked Lepanto Consolidated Mining to pay sand and gravel tax for the quarry materials
extracted from the mining site. The counterargument was that the said tax applied only to
commercial extractions and since Lepanto did not supply other users for some profit, the tax should
not apply.

ISSUE:
Is Lepanto liable for the tax imposed by Benguet on the sand and gravel that it extracted from within
the area of its mining claim used exclusively in its mining operations?

HELD:
YES. The CTA erred in applying the provision of the Local Government Code (Section 138) since the
basis of Benguet province emanates from the Revised Benguet Revenue Code itself. This
notwithstanding, the provincial revenue measure still did not distinguish between commercial and
non-commercial extractions.

In addition, the Petitioners argument that when a company is taxed on its main business it can no
longer be taxable for engaging in an activity that is but part of, incidental to, and necessary to such
main business, was held to be inapplicable. The Court said that the cases where the above principle
has been applied involved business taxes and thus the incidental activities could not be treated as

separate and distinct from the main business. Here the tax being imposed was an excise tax levied
on the privilege of extracting gravel and sand.

Province of Cam Sur v CA, 222 SCRA 137, GR 103125

(1993)
Facts: On December 22, 1988, the Sangguniang Panlalawigan of the Province of Camarines
Sur passed a Resolution authorizing the Provincial Governor to purchase or expropriate
property contiguous to the provincial Capitol site, in order to establish a pilot farm for non-food
and non-traditional agricultural crops and a housing project for provincial government
employees
Pursuant to the Resolution, the Province of Camarines Sur, through its Governor, filed two
separate cases for expropriation against Ernesto N. San Joaquin and Efren N. San Joaquin, at
the Regional Trial Court, Pili, Camarines Sur.
The San Joaquins moved to dismiss the complaints on the ground of inadequacy of the price
offered for their property. In an order, the trial court denied the motion to dismiss and authorized
the Province of Camarines Sur to take possession of the property upon the deposit with the
Clerk of Court the amount provisionally fixed by the trial court to answer for damages that
private respondents may suffer in the event that the expropriation cases do not prosper.

The San Joaquins filed a motion for relief from the order, authorizing the Province of Camarines
Sur to take possession of their property and a motion to admit an amended motion to dismiss.
Both motions were denied in the order dated February 26, 1990.

In their petition before the Court of Appeals, the San Joaquins asked: (a) that Resolution of the
Sangguniang Panlalawigan be declared null and void; (b) that the complaints for expropriation
be dismissed; and (c) that the order denying the motion to dismiss and allowing the Province of
Camarines Sur to take possession of the property subject of the expropriation and the order
dated February 26, 1990, denying the motion to admit the amended motion to dismiss, be set
aside. They also asked that an order be issued to restrain the trial court from enforcing the writ
of possession, and thereafter to issue a writ of injunction.

Asked by the Court of Appeals to give his Comment to the petition, the Solicitor General stated
that under Section 9 of the Local Government Code (B.P. Blg. 337), there was no need for the
approval by the Office of the President of the exercise by the Sangguniang Panlalawigan of the
right of eminent domain. However, the Solicitor General expressed the view that the Province of
Camarines Sur must first secure the approval of the Department of Agrarian Reform of the plan
to expropriate the lands of petitioners for use as a housing project.
The Court of Appeals set aside the order of the trial court, allowing the Province of Camarines
Sur to take possession of private respondents' lands and the order denying the admission of the
amended motion to dismiss. It also ordered the trial court to suspend the expropriation
proceedings until after the Province of Camarines Sur shall have submitted the requisite
approval of the Department of Agrarian Reform to convert the classification of the property of
the private respondents from agricultural to non-agricultural land.

Issue: WON the Province of Cam Sur must first secure the approval of the Department of
Agrarian Reform of the plan to expropriate the lands of the San Joaquins.

HELD: To sustain the Court of Appeals would mean that the local government units can no
longer expropriate agricultural lands needed for the construction of roads, bridges, schools,
hospitals, etc., without first applying for conversion of the use of the lands with the Department
of Agrarian Reform, because all of these projects would naturally involve a change in the land
use. In effect, it would then be the Department of Agrarian Reform to scrutinize whether the
expropriation is for a public purpose or public use.

Ratio: WHEREFORE, the petition is GRANTED and the questioned decision of the Court of
Appeals is set aside insofar as it (a) nullifies the trial court's order allowing the Province of
Camarines Sur to take possession of private respondents' property; (b) orders the trial court to
suspend the expropriation proceedings; and (c) requires the Province of Camarines Sur to
obtain the approval of the Department of Agrarian Reform to convert or reclassify private
respondents' property from agricultural to non-agricultural use.
The decision of the Court of Appeals is AFFIRMED insofar as it sets aside the order of the trial
court, denying the amended motion to dismiss of the private respondents.
SO ORDERED.

MODAY VS. CA
Municipal Corporation Eminent Domain Disapproval by SP of SB Resolution

Moday is a landowner in Bunawan, Agusan del Sur. In 1989, the Sangguniang Bayan of Bunawan passed a
resolution authorizing the mayor to initiate an expropriation case against a 1 hectare portion of Modays land.
Purpose of which is to erect a gymnasium and other public buildings. The mayor approved the resolution and the
resolution was transmitted to the Sangguniang Panlalawigan which disapproved the said resolution ruling that the
expropriation is not necessary because there are other lots owned by Bunawan that can be used for such purpose.
The mayor pushed through with the expropriation nonetheless.
ISSUE: Whether or not a municipality may expropriate private property by virtue of a municipal resolution which was
disapproved by the Sangguniang Panlalawigan.
HELD: Yes. Eminent domain, the power which the Municipality of Bunawan exercised in the instant case, is a
fundamental State power that is inseparable from sovereignty. It is governments right to appropriate, in the nature of
a compulsory sale to the State, private property for public use or purpose. Inherently possessed by the national
legislature, the power of eminent domain may be validly delegated to local governments, other public entities and
public utilities. For the taking of private property by the government to be valid, the taking must be for public use and
there must be just compensation. The only ground upon which a provincial board may declare any municipal
resolution, ordinance, or order invalid is when such resolution, ordinance, or order is beyond the powers conferred
upon the council or president making the same. This was not the case in the case at bar as the SP merely stated
that there are other available lands for the purpose sought, the SP did not even bother to declare the SB resolution as
invalid. Hence, the expropriation case is valid.