NAWASA vs.

DATOR

Facts: In 1961, in its decision in G.R. No. L-15525, the Supreme Court declared the municipality of
Lucban (Lucban) the owner of the Lucban Waterworks System, which is also known as Apolinario de
la Cruz Waterworks System. The decision has become final and executory.

 On February 2, 1962, Mayor Hobart Dator issued a Memorandum directing the Municipal
Treasurer to designate some of the clerks as temporary waterworks collectors to receive
the water rentals paid by the users. The treasurer thus proceeded to collect water faees, and
made collections from consumers.

National Waterworks and Sewerage Authority (NAWASA) filed with the Court of First Instance of Quezon
a petition to declare Mayor Dator in contempt, alleging that the acts of the latter in ordering for collection
of fees are in defiance of the Supreme Court's Decision in G.R. No. L-l5525.

 The decision declared Lucban as the owner of the Apolinario delaCruz Waterworks
System, subject to the control and supervision of NAWASA.

RTC: The lower court ruled in favor of Lucban and Mayor Dator. The collection of water fees and the
appointment of personnel of the system are acts relating to internal management and are not
included in the regulatory and supervisory powers embraced in the term 'Jurisdiction, supervision
and control" to be exercised by NAWASA over the waterworks system pertaining to municipalities under
Republic Act 1383.

Issue: Whether the mayor's order to collect water bills in the name of the municipality constitute contempt
of court as it is an encroachment upon NAWASA's supervisory power over the municipality's waterworks
system as declared in GR No. L-15525.

Supreme Court's Ruling: The Supreme Court affirmed the lower court's ruling and decided in favor of
Lucban and Mavor Dator.

The authority of a municipality to fix and collect rents for water supplied by its waterworks system
is expressly granted by law in Section 2317 of the Revised Administrative Code and section 2 of
Republic Act No.2264.

 Absent these express provisions, the authority of the municipality to fix and collect fees from its
waterworks would be justified from its inherent power to administer what it owns privately.
 It is now settled that although the NAWASA may regulate and supervise the water plants owned
and operated by cities and municipalities, the ownership thereof is vested in the municipality and
in the operation thereof the municipality acts in its proprietary capacity.
 If a govemmental entity, like the NAWASA, were allowed to collect the fees that the consuming
public pay for the water supplied to them by the municipality, the latter, as owner, would be deprived
of the full enjoyment of its property. As previously stated, ownership is nothing without the inherent
rights of possession, control and enjoyment.