fundamental powers of the state cases 1-7

[No. L-7995. May 31, 1957]LAO H. ICHONG, in his own behalf and in behalf of other alien residents, corporations and partnerships adversely affected by Republic Act No. 1180, petitioner, vs. JAIME HERNANDEZ, Secretary of Finance, and MARCELINO SARMIENTO, City Treasurer of Manila, respondents.

1156

1156 PHILIPPINE REPORTS ANNOTATEDIchong, etc., et al. vs. Hernandez, etc., and Sarmiento

1.1.CONSTITUTIONAL LAW; POLICE POWER; NATURE AND SCOPE.—Police power is far-

reaching in scope, and it is almost impossible to limit its sweep. It derives its existence from the very

existence of the State itself, and does not need to be expressed or defined in its scope. It is said to be co-

extensive with self-protection and survival, and as such it is the most positive and active of all

governmental processes, the most essential, insistent and illimitable. Especially is it so under a modern

democratic framework where the demands of society and of nations have multiplied to almost unimaginable

proportions; the field and scope of police power has become almost boundless, just as the fields of public interest and public welfare have become almost all-

embracing and have transcended human foresight.1.2.ID.; GUARANTEES IN SECTION I, ARTICLE III OF

THE CONSTITUTION; UNIVERSALITY OF APPLICATION.—The constitutional guarantees in

Section I, Article III, of the Constitution, which embody the essence of individual liberty and freedom

in democracies, are not limited to citizens alone but are admittedly universal in their application, without

regard to any differences of race, of color, or of nationality (Yiek Wo vs. Hopkins, 30 L. ed., 220,

226).1.3.ID.; LAW DEPRIVATION OF LIFE, LIBERTY OR

PROPERTY; TEST OR STANDARD.—The conflict between police power and the guarantees of due process and equal protection of the laws is more

apparent than real. Properly related, the power and the guarantees are supposed to coexist. The balancing is

the essence, or the indispensable means for the" attainment of legitimate aspirations of any democratic

society. There can be no absolute power, whoever exercises it, for that would be tyranny. Yet there can

neither be absolute liberty, for that would mean license and anarchy. So the State can deprive persons

of life, liberty or property, provided there is due process of law; and persons may be classified into classes and groups, provided everyone is given the equal protection of the law. The test or standard, as

always, is reason. The police power legislation must be firmly grounded on public interest and welfare, and a reasonable relation must exist between purposes and

means. And if disctinction or classification has been made, there must be a reasonable basis for said

distinction.1.4.ID.; EQUAL PROTECTION OF THE LAW CLAUSE;

WHEN NOT DEEMED INFRINGED BY LEGISLATION.—The equal protection of the law

clause is against undue favor and individual or class privilege, as well as hostile discrimination or the

oppression of inequality.1157

VOL. 101, MAY 81, 1957

Ichong, etc., et al. vs. Hernandez, etc., and Sarmiento1.It is not intended to prohibit legislation, which is limited

either in the object to which it is directed or by territory within which it is to operate. It does not demand absolute equality among residents; it merely requires that all persons shall be treated alike, under like circumstances and conditions both as to privileges conferred and liabilities enforced. The equal protection clause is not infringed by legislation which applies only to those persons falling within a specified class, if it applies alike to all persons within such class, and reasonable grounds exist for making a distinction between those who fall within such class and those who do not (2 Cooley, Constitutional Limitations, 824-825).

1.5.ID. ; ID. ; LEGISLATIVE POWER TO MAKE DISTINCTION AND CLASSIFICATION AMONG

PERSONS; CITIZENSHIP AS GROUND FOR CLASSIFICATION.—The power of the legislature to make distinctions and classifications among persons is

not curtailed or denied by the equal protection of the laws clause. The legislative power admits of a wide

scope of discretion, and a law can be violative of the constitutional limitation only when the classification

is without reasonable basis. Citizenship is a legal and valid ground for classification.

1.6.ID.; ID.; NATIONALIZATION OF RETAIL TRADE; CLASSIFICATION IN REPUBLIC ACT No. 1180

ACTUAL, REAL AND REASONABLE.—The classification in the law of retail traders into nationals

and aliens is actual, real and reasonable. All persons of one class are treated alike, and it cannot be said that

the classification is patently unreasonable and

unfounded. Hence, it is the duty of this Court to declare that the legislature acted within its legitimate

prerogative and it cannot declare that the act transcends the limits of equal protection established

by the Constitution.1.7.ID. ; ID. ; ID. ; ID. ; TEST OF REASONABLENESS.—

The law in question is deemed absolutely necessary to bring about the desired legislative objective, i.e., to

free the national economy from alien control and dominance. It is not necessarily unreasonable because it affects private rights and privileges (II Am. Jur., pp. 1080-1081). The test of reasonableness of a law is the appropriateness or adequacy under all circumstances

of the means adopted to carry out its purpose into effect. Judged by this test, the disputed legislation,

which is not merely reasonable but actually necessary, must be considered not to have infringed the

constitutional limitation of reasonableness.1.8.ID.; ID.; ID.; ID.; ID.; REPUBLIC ACT No. 1180

TOLERANT AND REASONABLE.—A cursory study of the provisions of the law

1158


1.immediately reveals how tolerant and reasonable the Legislature has been. The law is made prospective and recognizes the right and privilege of those already engaged in the occupation to continue therein during the rest of their lives; and similar recognition of the right to continue is accorded associations of aliens. The right or privilege is denied only to persons upon conviction of certain offenses.

1.9.ID.; ID.; ID.; ATTAINMENT OF LEGISLATIVE ASPIRATIONS OF A PEOPLE NOT BEYOND THE

LIMITS OF LEGISLATIVE AUTHORITY.—If political independence is a legitimate aspiration of a people, then economic independence is none of less

legitimate. Freedom and liberty are not real and positive, if the people are subject to the economic

control and domination of others, especially if not of their own race or country. The removal and

eradication of the shackles of foreign economic control and domination is one of the noblest motives

that a national legislature may pursue. It is impossible to conceive that legislation that seeks to bring it about

can infringe the constitutional limitation of due process. The attainment of a legitimate aspiration of a

people can never be beyond the limits of legislative authority.

1.10.ID.; ID.; ID.; NATIONALISTIC TENDENCY MANIFESTED IN THE CONSTITUTION.—Nationalistic tendency is manifested in various

provisions of the Constitution. The nationalization of the retail trade is only a continuance of the

nationalistic protective policy laid down as a primary objective of the Constitution, It cannot therefore be

said that a law imbued with the same purpose and spirit underlying many of the provisions of the

Constitution is unreasonable, invalid or unconstitutional.

1.11.ID.; LEGISLATIVE DEPARTMENT; EXERCISE OF LEGISLATIVE DISCRETION NOT SUBJECT TO

JUDICIAL REVIEW.—The exercise of legislative discretion is not subject to judicial review. The Court

will not inquire into the motives of the Legislature,

nor pass upon general matters of legislative judgment. The Legislature is primarily the judge of the necessity of an enactment or of any of its provisions, and every presumption is in favor of its validity, and though the

Court may hold views inconsistent with the wisdom of the law, it may not annul the legislation if not

palpably in excess of the legislative power.1.12.ID.; TITLES OF BILLS; PROHIBITION AGAINST

DUPLICITY; PRESENCE OF DUPLICITY NOT SHOWN IN TlTLE OR PROVISIONS OF

REPUBLIC ACT No. 1180.—What Section 21(1) of Article VI of the Constitution prohibits is duplicity,

that is, if its title completely fails to apprise the legislators or the public of the nature.

1159

VOL. 101, MAY 31, 1957Ichong, etc., et al. vs. Hernandez, etc., and Sarmiento

1.scope and consequences of the law or its operation (I Sutherland, Statutory Construction, Sec. 1707, p. 297). A cursory consideration of the title and the provisions of the bill fails to show the presence of duplicity. It is true that the term "regulate" does not and may not readily and at first glance convey the idea of "nationalization" and "prohibition", which terms express the two main purposes and objectives of the law. But "regulate" is a broader term than either prohibition or nationalization. Both of these have always been included within the term "regulation".

1.13.ID.; ID.; ID.; ID.; USE OF GENERAL TERMS IN TITLE OF BILL.—The general rule is for the use of

general terms in the title of a bill; the title need not be an index to the entire contents of the law (I

Sutherland, Statutory Construction, Sec. 4803, p. 345). The above rule was followed when the title of

the Act in question adopted the more general term "regulate" instead of "nationalize" or "prohibit".

1.14.ID.; ID.; ID.; ID.; PURPOSE OF CONSTITUTIONAL DIRECTIVE REGARDING SUBJECT OF A BILL.—One purpose of the constitutional directive that the

subject of a bill should be embraced in its title is to apprise the legislators of the purposes, the nature and

scope of its provisions, and prevent the enactment into law of matters which have not received the notice,

action and study of the legislators or of the public. In case at bar it cannot be claimed that the legislators

have not been apprised of the nature of the law, especially the nationalization and prohibition

provisions. The legislators took active interest in the discussion of the law, and a great many of the persons

affected by the prohibition in the law conducted a campaign against its approval. It cannot be claimed,

therefore, that the reasons for declaring the law invalid ever existed.

1.15.ID.; INTERNATIONAL TREATIES AND OBLIGATIONS NOT VIOLATED BY REPUBLIC

ACT No. 1180; TREATIES SUBJECT TO QUALIFICATION OR AMENDMENT BY

SUBSEQUENT LAW.—The law does not violate international treaties and obligations. The United

Nations Charter imposes no strict or legal obligations regarding the rights and freedom of their subjects

(Jans Kelsen, The Law of the United Nations, 1951 ed., pp. 29-32), and the Declaration of Human Rights contains nothing more than a mere recommendation, or a common standard of achievement for all peoples

and all nations. The Treaty of Amity between the Republic of the Philippines and the Republic of China

of April 18, 1947 guarantees equality of treatment to the Chinese nationals "upon the same terms as the

nationals of any other1160

1160 PHILIPPINE REPORTS ANNOTATEDIchong, etc. et al. vs. Hernandez, etc., and Sarmiento

1.country". But the nationals of China are not discriminated against because nationals of all other countries, except those of the United States, who are granted special rights by the Constitution, are all prohibited from engaging in the retail trade. But even supposing that the law infringes upon the said treaty, the treaty is always subject to qualification or amendment by a subsequent law (U.S. vs. Thompson, 258, Fed. 257, 260), and the same may never curtail or restrict the scope of the police power of the State (Palston vs. Pennsylvania 58 L. ed., 539).

ORIGINAL ACTION in the Supreme Court. Injunction and Mandamus.

The facts are stated in the opinion of the Court.Ozaeta, Lichauco & Picazo and Sycip, Quisumbing,

Salazar & Associates for petitioner.Solicitor General Ambrosio Padilla and Solicitor

Pacifico P. de Castro for respondent Secretary of Finance.City Fiscal Eugenio Angeles and Assistant City Fiscal

Eulogio S. Serrano for respondent City Treasurer.Dionisio Reyes as Amicus Curiae.Marcial G. Mendiola as Amicus Curiae.Emiliano R. Navarro as Amicus Curiae.

LABRADOR, J.:

I. The case and the issue, in generalThis Court has before it the delicate task of passing upon the validity and constitutionality of a legislative enactment, fundamental and far-reaching in significance. The enactment poses questions of due process, police power and equal protection of the laws. It also poses an important issue of fact, that is whether the conditions which the disputed law purports to remedy really or actually exist. Admittedly springing from a deep, militant, and positive nationalistic impulse, the law purports to protect citizen and country from the alien retailer. Through it, and within the field of economy it regulates, Congress attempts

1161


to translate national aspirations for economic independence and national security, rooted in the drive and urge for national survival and welfare, into a concrete and tangible measures designed to free the national retailer from the competing dominance of the alien, so that the country and the nation may be free from a supposed economic dependence and bondage. Do the facts and circumstances justify the enactment?II. Pertinent provisions of Republic Act No. 1180Republic Act No. 1180 is entitled "An Act to Regulate the Retail Business." In effect it nationalizes the retail trade business. The main provisions of the Act are: (1) a prohibition against persons, not citizens of the Philippines, and against associations, partnerships, or corporations the capital of which are not wholly owned by citizens of the Philippines, from engaging directly or indirectly in the retail trade; (2) an exception from the above prohibition in favor

of aliens actually engaged in said business on May 15, 1954, who are allowed to continue to engage therein, unless their licenses are forfeited in accordance with the law, until their death or voluntary retirement in case of natural persons, and for ten years after the approval of the Act or until the expiration of term in case of juridical persons; (3) an exception therefrom in favor of citizens and juridical entities of the United States; (4) a provision for the forfeiture of licenses (to engage in the retail business) for violation of the laws on nationalization, economic control weights and measures and labor and other laws relating to trade, commerce and industry; (5) a prohibition against the establishment or opening by aliens actually engaged in the retail business of additional stores or branches of retail business, (6) a provision requiring aliens actually engaged in the retail business to present for registration with the proper authorities a verified statement concerning their businesses, giving, among other matters, the nature of the business, their assets

1162


and liabilities and their offices and principal offices of juridical entities; and (7) a provision allowing the heirs of aliens now engaged in the retail business who die, to continue such business for a period of six months for purposes of liquidation.III. Grounds upon which petition is based—Answer theretoPetitioner, for and in his own behalf and on behalf of other alien residents, corporations and partnerships adversely affected by the provisions of Republic Act No. 1180,

brought this action to obtain a judicial declaration that said Act is unconstitutional, and to enjoin the Secretary of Finance and all other persons acting under him, particularly city and municipal treasurers, from enforcing its provisions. Petitioner attacks the constitutionality of the Act, contending that: (1) it denies to alien residents the equal protection of the laws and deprives them of their liberty and property without due process of law; (2) the subject of the Act is not expressed or comprehended in the title thereof; (3) the Act violates international and treaty obligations of the Republic of the Philippines; (4) the provisions of the Act against the transmission by aliens of their retail business thru hereditary succession, and those requiring 100% Filipino capitalization for a corporation or entity to entitle it to engage in the retail business, violate the spirit of Sections 1 and 5, Article XIII and Section 8 of Article XIV of the Constitution.

In answer, the Solicitor-General and the Fiscal of the City of Manila contend that: (1) the Act was passed in the valid exercise of the police power of the State, which exercise is authorized in the Constitution in the interest of national economic survival; (2) the Act has only one subject embraced in the title; (3) no treaty or international obligations are infringed; (4) as regards hereditary succession, only the form is affected but the value of the property is not impaired, and the institution of inheritance is only of statutory origin.

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IV. Preliminary consideration of legal principles involveda. The police power.—There is no question that the Act was approved in the

exercise of the police power, but petitioner claims that its exercise in this instance is attended by a violation of the constitutional requirements of due process and equal protection of the laws. But before proceeding to the consideration and resolution of the ultimate issue involved, it would be well to bear in mind certain basic and f undamental, albeit preliminary, considerations in the determination of the ever recurrent conflict between police power and the guarantees of due process and equal protection of the laws. What is the .scope of police power, and how are the due process and equal protection clauses related to it? What is the province and power of the legislature, and what is the function and duty of the courts? These consideration must be clearly and correctly understood that their application to the f acts of the case may be brought forth with clarity and the issue accordingly resolved.

It has been said that police power is so far-reaching in scope, that it has become almost impossible to limit its sweep. As it derives its existence from the very existence of the State itself, it does not need to be expressed or defined in its scope; it is said to be co-extensive with selfprotection and survival, and as such it is the most positive and active of all governmental processes, the most essential, insistent and illimitable. Especially is it so under a modern democratic framework where the demands of society and of nations have multiplied to almost unimaginable proportions; the field and scope of police power has become almost boundless, just as the fields of public interest and public welfare have become almost all-embracing and have transcended human foresight. Otherwise stated, as we cannot foresee the needs and demands of public interest and welfare in this constantly changing and progressive world, so we

cannot delimit beforehand the extent or scope1164


of police power by which and through which the State seeks to attain or achieve public interest or welfare. So it is that Constitutions do not define the scope or extent of the police power of the State; what they do is to set f orth the limitations thereof. The most important of these are the due process clause and the equal protection clause.b. Limitations on police power.—The basic limitations of due process and equal protection are found in the following provisions of our Constitution:"SECTION 1.(1) No person shall be deprived of life, liberty or property without due process of law, nor shall any person be denied the equal protection of the laws." (Article III, Phil. Constitution)These constitutional guarantees which embody the essence of individual liberty and freedom in democracies, are not limited to citizens alone but are admittedly universal in their application, without regard to any differences of race, of color, or of nationality. (Yick Wo vs. Hopkins, 30, L. ed. 220, 226.)c. The equal protection clause.—The equal protection of the law clause is against undue favor and individual or class privilege, as well as hostile discrimination or the oppression of inequality. It is not intended to prohibit legislation, which is limited either in the object to which it is directed or by territory within which it is to operate. It does not demand absolute equality among residents; it merely requires that all persons shall be treated alike, under like circumstances and conditions both as to

privileges conferred and liabilities enforced. The equal protection clause is not infringed by legislation which applies only to those persons falling within a specified class, if it applies alike to all persons within such class, and reasonable grounds exists for making a distinction between those who fall within such class and those who do not. (2 Cooley, Constitutional Limitations, 824-825.)

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d. The due process clause.—The due process clause has to do with the reasonableness of legislation enacted in pursuance of the police power. Is there public interest, a public purpose; is public welf are involved? Is the Act reasonably necessary for the accomplishment of the legislature's purpose; is it not unreasonable, arbitrary or oppressive? Is there sufficient foundation or reason in connection with the matter involved; or has there not been a capricious use of the legislative power? Can the aims conceived be achieved by the means used, or is it not merely an unjustified interference with private interest? These are the questions that we ask when the due process test is applied.

The conflict, therefore, between police power and the guarantees of due process and equal protection of the laws is more apparent than real. Properly related; the power and the guarantees are supposed to coexist. The balancing is the essence or, shall it be said, the indispensable means for the attainment of legitimate aspirations of any democratic society. There can be no absolute power, whoever exercise it, for that would be tyranny. Yet there can neither be absolute liberty, for that would mean license and anarchy.

So the State can deprive persons of life, liberty and property, provided there is due process of law; and persons may be classified into classes and groups, provided everyone is given the equal protection of the law. The test or standard, as always, is reason, The police power legislation must be firmly grounded on public interest and welfare, and a reasonable relation must exist between purposes and means. And if distinction and classification has been made, there must be a reasonable basis for said distinction.e. Legislative discretion not subject to judicial review.—Now, in this matter of equitable balancing, what is the proper place and role of the courts ? It must not be overlooked, in the first place, that the legislature, which is the

1166


constitutional repository of police power and exercises the prerogative of determining the policy of the State, is by force of circumstances primarily the judge of necessity, adequacy or reasonableness and wisdom, of any law promulgated in the exercise of the police power, or of the measures adopted to implement the public policy or to achieve public interest. On the other hand, courts, although zealous guardians of individual liberty and right, have nevertheless evinced a reluctance to interfere with the exercise of the legislative prerogative. They have done so early where there has been a clear, patent or palpable arbitrary and unreasonable abuse of the legislative prerogative. Moreover, courts are not supposed to override legitimate policy, and courts never inquire into the wisdom of the law.

V. Economic problems sought to be remediedWith the above considerations in mind, we will now proceed to delve directly into the issue involved. If the disputed legislation were merely a regulation, as its title indicates, there would be no question that it falls within the legitimate scope of legislative power.. But it goes further and prohibits a group of residents, the aliens, from engaging therein. The problem becomes more complex because its subject is a common, trade or occupation, as old as society itself, which from time immemorial has always been open to residents, irrespective of race, color or citizenship.a. Importance of retail trade in the economy of the nation.—In a primitive economy where families produce all that they consume and consume all that they produce, the dealer, of course, is unknown. But as group life develops and families begin to live in communities producing more than what they consume and needing an infinite number of things they do not produce, the dealer comes into existence.

1167


As villages develop into big communities and specialization in production begins, the dealer's importance is enhanced. Under modern conditions and standards of living, in which man's needs have multiplied and diversified to unlimited extents and proportions, the retailer comes as essential as the producer, because thru him the infinite variety of articles, goods and commodities needed for daily life are placed within the easy reach of consumers. Retail dealers perform the functions of capillaries in the human body, thru which all the needed food and supplies are ministered to members of the communities comprising the nation.

There cannot be any question about the importance of the retailer in the life of the community. He ministers to the resident's daily needs, food in all its increasing forms, and the various little gadgets and things needed for home and daily life. He provides his customers around his store with the rice or corn, the fish, the salt, the vinegar, the ,spices needed for the daily cooking. He has cloths to sell, even the needle and the thread to sew them or darn the clothes that wear out. The retailer, therefore, from the lowly peddler, the owner of a small sari-sari store, to the operator of a department store or a supermarket is so much a part of day-to-day existence.b. The alien retailer's traits.—The alien retailer must have started plying his trade in this country in the bigger centers of population (Time there was when he was unknown in provincial towns and villages). Slowly but gradually he invaded towns and villages; now he predominates in the cities and big centers of population. He even pioneers in far away nooks where the beginnings of community life appear, ministering to the daily needs of the residents and purchasing their agricultural produce for sale in the towns. It is an undeniable fact that in many communities the alien has replaced the native retailer. He has shown in this trade, industry without limit, and the patience and forbearance of a slave.

1168


Derogatory epithets are hurled at him, but he laughs these off without murmur; insults of ill-bred and insolent neighbors and customers are made in his face, but he heeds them not, and he forgets and forgives. The community takes

no note of him, as he appears to be harmless and extremely useful.c. Alleged alien control and dominance.—There is a general f eeling on the part of the public, which appears to be true to f act, about the controlling and dominant position that the alien retailer holds in the nation's economy. Food and other essentials, clothing, almost all articles of daily life reach the residents mostly through him. In big cities and centers of population he has acquired not only predominance, but apparent control over distribution of almost all kinds of goods, such as lumber, hardware, textiles, groceries, drugs, sugar, flour, garlic, and scores of other goods and articles. And were it not for some national corporations like the Naric, the Namarco, the Facomas and the Accfa, his control over principal foods and products would easily become full and complete.

Petitioner denies that there is alien predominance and control in the retail trade. In one breath it is said that the fear is unfounded and the threat is imagined; in another, it is charged that the law is merely the result of racialism and pure and unabashed nationalism. Alienage, it is said, is not an element of control; also so many unmanageable factors in the retail business make control virtually impossible. The first argument which brings up an issue of fact merits serious consideration. The others are matters of opinion within the exclusive competence of the legislature and beyond our prerogative to pass upon and decide.

The best evidence are the statistics on the retail trade, which put down the figures in black and white. Between the constitutional convention year (1935), when the fear of alien domination and control of the retail trade already

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VOL. 101, MAY 31, 1957

Ichong etc., et al. vs. Hernandez, etc., and Sarmientofilled the minds of our leaders with fears and misgivings, and the year of the enactment of the nationalization of the retail trade act (1954), official statistics unmistakably point out to the ever-increasing dominance and control by the alien of the retail trade, as witness the following tables;

Assets

Year and Retailer's

Nationality

No.-Establishments

Pesos Percent Distribution

1941:

Filipino 106,671 200, 323, 138 55.82

Chinese 15,356 118,348,692 32.98

Others 1,646 40,187,090 11.20

1947:

Filipino 111,107 208, 658, 946 65.05

Chinese 13,774 106,156,218 33.56

Others 354 8,761,260

1948: (Census)

Filipino 113,631 213, 342, 264 67.30

Chinese 12,087 93,155,459 29.38

Others 422 10,514,675 3.32

1949:

Filipino 113,659 213, 451, 602 60.89

Chinese 16,248 125,223,336 35.72

Others 486 12,056,365 3.39

1951:

Filipino 119,352 224, 053, 620 61.09

Chinese 17,429 134,325,303 36.60

Others 347 8,614,025 2.31AVERAGE

ASSETS AND GROSS SALES PER ESTABLISHMENT

Year and Retailer's

Nationality (Pesos)

1941:

Filipino

Chinese

Others 1170

1170 PHILIPPINE REPORTS ANNOTATEDIchong etc., et al. vs. Hernandez, etc., and Sarmiento

1947:

Filipino

Chinese

Others

1948: (Census)

Filipino

Chinese

Others

1949:

Filipino

Chinese

Others

1951:

Filipino

Chinese

Others(Estimated Assets and Gross Sales of Retail Establishments, By Year and Nationality of Owners, Benchmark: 1948 Census, issued by the Bureau of Census and Statistics, Department of Commerce and Industry; pp. 18-19 of Answer.)The above statistics do not include corporations and partnerships, while the figures on Filipino establishments already include mere market vendors, whose capital is necessarily small.

The above figures reveal that in percentage distribution of assets and of gross sales, alien participation has steadily increased during the years. It is true, of course, that Filipinos have the edge in the number of retailers, but aliens more than make up for the numerical gap through their assets and gross sales which average between six and seven times those of the very many Filipino retailers. Numbers in retailers, here, do not imply superiority; the alien invests more capital, buys and sells six to seven times more, and gains much more. The same official report, pointing out to the known predominance of foreign elements in the retail trade,

remarks that the Filipino retailers were largely engaged in minor retailer enterprises. As observed by respondents, the native investment is

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VOL. 101, MAY 31, 1957Ichong etc., et al. vs. Hernandez, etc., and Sarmiento

thinly spread, and the Filipino retailer is practically helpless in matters of capital, credit, price and supply,d. Alien control and threat, subject of apprehension in Constitutional Convention.—It is this domination and control, which we believe has been sufficiently shown to exist, that is the legislature's target in the enactment of the disputed nationalization law. If they did not exist as a fact the sweeping remedy of nationalization would never have been adopted. The framers of our Constitution also believed in the existence of this alien dominance and control when they approved a resolution categorically declaring among other things, that "it is the sense of the Convention that the public interest requires the nationalization of the retail trade; * * *." (II Aruego, The Framing of the Philippine Constitution, 662663, quoted on page 67 of Petitioner.) That was twentytwo years ago; and the events since then have not been either pleasant or comforting. Dean Sinco of the University of the Philippines College of Law, commenting on the patrimony clause of the Preamble opines that the fathers of our Constitution were merely translating the general preoccupation of Filipinos "of the dangers from alien interests that had already brought under their control the commercial and other economic activities of the country" (Sinco, Phil. Political Law, 10th ed., p, 114); and analyzing the concern of the members of the constitutional convention for the economic life of the

citizens, in connection with the nationalistic provisions of the Constitution, he says:"But there has been a general feeling that alien dominance over the economic life of the country is not desirable and that if such a situation should remain, political independence alone is no guarantee to national stability and strength. Filipino private capital is not big enough to wrest from alien hands the control of the national economy. Moreover, it is but of recent formation and hence, largely inexperienced, timid and hesitant. Under such conditions, the government as the instrumentality of the national will, has to step in and assume the initiative, if not the leadership, in the struggle for the

1172


economic freedom of the nation in somewhat the same way that it did in the crusade for political freedom. Thus * * * it (the Constitution) envisages an organized movement for the protection of the nation not only against the possibilities of armed invasion but also against its economic subjugation by alien interests in the economic field." (Phil. Political Law by Sinco, 10th ed., p. 476.)Belief in the existence of alien control and predominance is felt in other quarters. Filipino businessmen, manufacturers and producers believe so; they fear the dangers coming from alien control, and they express sentiments of economic independence. Witness thereto is Resolution No. 1, approved on July 18, 1953, of the Fifth National Convention of Filipino Businessmen, and a similar resolution, approved on March 20, 1954, of the Second National Convention of Manufacturers and Producers. The man in the street also

believes, and fears, alien predominance and control; so our newspapers, which have editorially pointed out not only to control but to alien stranglehold. We, therefore, find alien domination and control to be a fact, a reality proved by official statistics, and felt by all the sections and groups that compose the Filipino community.e. Dangers of alien control and dominance in retail.But the dangers arising from alien participation in the retail trade does not seem to lie in the predominance alone; there is a prevailing feeling that such predominance may truly endanger the national interest. With ample capital, unity of purpose and action and thorough organization, alien retailers and merchants can act in such complete unison and concert on such vital matters as the fixing of prices, the determination of the amount of goods or articles to be made available in the market, and even the choice of the goods or articles they would or would not patronize or distribute, that fears of dislocation of the national economy and of the complete subservience of national retailers and of the consuming public are not entirely unfounded. Nationals, producers

1173


and consumers alike, can be placed completely at their mercy. This is easily illustrated. Suppose an article of daily use is desired to be prescribed by the aliens, because the producer or importer does not offer them sufficient profits, or because a new competing article offers bigger profits for its introduction. All that aliens would do is to agree to refuse to sell the first article, eliminating it from their stocks, offering the new one as a substitute. Hence, the producers or

importers of the prescribed article, or its consumers, find the article suddenly out of circulation. Freedom of trade is thus curtailed and free enterprise correspondingly suppressed.

We can even go farther than theoretical illustrations to show the pernicious influences of alien domination. Grave abuses have characterized the exercise of the retail trade by aliens. It is a fact within judicial notice, which courts of justice may not properly overlook or ignore in the interests of truth and justice, that there exists a general feeling on the part of the public that alien participation in the retail trade has been attended by a pernicious and intolerable practices, the mention of a few of which would suffice for our purposes; that at some time or other they have cornered the market of essential commodities, like corn and rice, creating artificial scarcities to justify and enhance profits to unreasonable proportions; that they have hoarded essential foods to the inconvenience and prejudice of the consuming public, so much so that the Government has had to establish the National Rice and Corn Corporation to save the public from their continuous hoarding practices and tendencies; that they have violated price control laws, especially on foods and essential commodities, such that the legislature had to enact a law (Sec. 9, Republic Act No. 1168), authorizing their immediate and automatic deportation for price control convictions; that they have secret combinations among themselves to control prices, cheating the operation of the law of supply and demand;

1174


that they have connived to boycott honest merchants and traders who would not cater or yield to their demands, in

unlawful restraint of freedom of trade and enterprise. They are believed by the public to have evaded tax laws, smuggled goods and money into and out of the land, violated import and export prohibitions, control laws and the like, in derision and contempt of lawful authority. It is also believed that they have engaged in corrupting public officials with fabulous bribes, indirectly causing the prevalence of graft and corruption in the Government. As a matter of fact appeals to unscrupulous aliens have been made both by the Government and by their own lawful diplomatic representatives, action which impliedly admits a prevailing feeling about the existence of many of the above practices.

The circumstances above set forth create well founded fears that worse things may come in the future. The present dominance of the alien retailer, especially in the big centers of population, therefore, becomes a potential source of danger on occasions of war or other calamity. We do not have here in this country isolated groups of harmless aliens retailing goods among nationals; what we have are well organized and powerful groups that dominate the distribution of goods and commodities in the communities and big centers of population. They owe no allegiance or loyalty to the State, and the State cannot rely upon them in times of crisis or emergency. While the national holds his life, his person and his property subject to the needs of his country, the alien may even become the potential enemy of the State.f. Law enacted in interest of national economic survival and security.—We are fully satisfied upon a consideration of all the facts and circumstances that the disputed law is not the product of racial hostility, prejudice or discrimination, but the

expression of the legitimate desire and determina-1175


tion of the people, thru their authorized representatives, to free the nation from the economic situation that has unfortunately been saddled upon it rightly or wrongly, to its disadvantage. The law is clearly in the interest of the public, nay of the national security itself, and indisputably falls within the scope of police power, thru which and by which the State insures its existence and security and the supreme welfare of its citizens.VI. The Equal Protection Limitationa.Objections to alien participation in retail trade.—The next question that now poses solution is, Does the law deny the equal protection of the laws? As pointed out above, the mere fact of alienage is the root and cause of the distinction between the alien and the national as a trader. The alien resident owes allegiance to the country of his birth or his adopted country; his stay here is for personal convenience; he is attracted by the lure of gain and profit. His aim or purpose of stay, we admit, is neither illegitimate nor immoral, but he is naturally lacking in that spirit of loyalty and enthusiasm for this country where he temporarily stays and makes his living, or of that spirit of regard, sympathy and consideration for his Filipino customers as would prevent him from taking advantage of their weakness and exploiting them. The faster he makes his pile, the earlier can the alien go back to his beloved country and his beloved kin and countrymen. The experience of the country is that the alien retailer has shown such utter disregard for his customers and the people on whom he makes his profit, that

it has been found necessary to adopt the legislation, radical as it may seem.

Another objection to the alien retailer in this country is that he never really makes a genuine contribution to national income and wealth. He undoubtedly contributes to general distribution, but the gains and profits he makes are not invested in industries that would help the

1176


country's economy and increase national wealth. The alien's interest in this country being merely transient and temporary, it would indeed be ill-advised to continue entrusting the very important function of retail distribution to his hands.

The practices resorted to by aliens in the control of distribution, as already pointed out above, their secret manipulations of stocks of commodities and prices, their utter disregard of the welfare of their customers and of the ultimate happiness of the people of the nation of which they are mere guests, which practices, manipulations and disregard do not attend the exercise of the trade by the nationals, show the existence of real and actual, positive and fundamental differences between an alien and a national which fully justify the legislative classification adopted in the retail trade measure. These differences are certainly a valid reason for the State to prefer the national over the alien in the retail trade. We would be doing violence to fact and reality were we to hold that no reason or ground for a legitimate distinction can be found between one and the other.b. Difference in alien aims and purposes sufficient basis for

distinction.—The above objectionable characteristics of the exercise of the retail trade by the aliens, which are actual and real, furnish sufficient grounds for legislative classification of retail traders into nationals and aliens. Some may disagree with the wisdom of the legislature's classification. To this we answer, that this is the prerogative of the law-making power. Since the Court finds that the classification is actual, real and reasonable, and all persons of one class are treated alike, and as it cannot be said that the classification is patently unreasonable and unfounded, it is in duty bound to declare that the legislature acted within its legitimate prerogative and it cannot declare that the act transcends the limit of equal protection established by the Constitution.

1177


Broadly speaking, the power of the legislature to make distinctions and classifications among persons is not curtailed or denied by the equal protection of the laws clause. The legislative power admits of a wide scope of discretion, and a law can be violative of the constitutional limitation only when the classification is without reasonable basis. In addition to the authorities we have earlier cited, we can also refer to the case of Lindsley vs. Natural Carbonic Gas Co. (1911), 55 L. ed., 369, which clearly and succinctly defined the application of equal protection clause to a law sought to be voided as contrary thereto:"* * *. 1. The equal protection clause of the Fourteenth Amendment does not take from the state the power to classify in the adoption of police laws, but admits of the exercise of the wide scope of discretion in that regard, and

avoids what is done only when it is without any reasonable basis, and therefore is purely arbitrary. 2. A classification having some reasonable basis does not offend against that clause merely because it is not made with mathematical nicety, or because in practice it results in some inequality. 3. When the classification in such a law is called in question, if any state of facts reasonably can be conceived that would sustain it, the existence of that state of facts at the time the law was enacted must be assumed. 4. One who assails the classification in such a law must carry the burden of showing that it does not rest upon any reasonable basis, but is essentially arbitrary.'"c. Authorities recognizing citizenship as basis for classification.—The question as to whether or not citizenship is a legal and valid ground for classification has already been affirmatively decided in this jurisdiction as well as in various courts in the United States. In the case of Smith Bell & Co. vs. Natividad, 40 Phil. 136, where the validity of Act No. 2761 of the Philippine Legislature was in issue, because of a condition therein limiting the ownership of vessels engaged in coastwise trade to corporations formed by citizens of the Philippine Islands or the United States, thus denying the right to aliens, it was held that the Philippine Legislature did not violate the equal pro-

1178


tection clause of the Philippine Bill of Rights. The Legislature in enacting the law had as ultimate purpose the encouragement of Philippine shipbuilding and the safety for these Islands from foreign interlopers. We held that this was

a valid exercise of the police power, and all presumptions are in favor of its constitutionality. In substance, we held that the limitation of domestic ownership of vessels engaged in coastwise trade to citizens of the Philippines does not violate the equal protection of the law and due process of law clauses of the Philippine Bill of Rights. In rendering said decision we quoted with approval the concurring opinion of Justice Johnson in the case of Gibbons vs. Ogden, 9 Wheat., I, as follows:" 'Licensing acts, in fact, in legislation, are universally restraining acts; as, for example, acts licensing gaming houses, retailers of spirituous liquors, etc. The act, in this instance, is distinctly of that character, and forms part of an extensive system, the object of which is to encourage American shipping, and place them on an equal footing with the shipping of other nations. Almost every commercial nation reserves to its own subjects a monopoly of its coasting trade; and a countervailing privilege in favor of American shipping is contemplated, in the whole legislation of the United States on this subject. It is not to give the vessel an American character, that the license is granted; that effect has been correctly attributed to the act of her enrollment. But it is to confer on her American privileges, as contradistinguished from foreign; and to preserve the Government from fraud by foreigners; in surreptitiously intruding themselves into the American commercial marine, as well as frauds upon the revenue in the trade coastwise, that this whole system is projected.'"The rule in general is as follows:"Aliens are under no special constitutional protection which forbids a classification otherwise justified simply because the limitation of the class falls along the lines of nationality. That would be requiring a higher degree of protection for

aliens as a class than for similar classes of American citizens. Broadly speaking, the difference in status between citizens and aliens constitutes a basis for reasonable classification in the exercise of police power." (2 Am. Jur. 468-469.)

1179


In Commonwealth vs. Hana, 81 N. E. 149 (Massachusetts, 1907), a statute on the licensing of hawkers and peddlers, which provided that no one can obtain a license unless he is, or has declared his intention, to become a citizen of the United States, was held valid, for the following reason: It may seem wise to the legislature to limit the business of those who are supposed to have regard for the welfare, good order and happiness of the community, and the court cannot question this judgment and conclusion. In Bloomfield vs. State, 99 N.E. 309 (Ohio, 1912), a statute which prevented certain persons, among them aliens, from engaging in the traffic of liquors, was found not to be the result of race hatred, or inhospitality, or a deliberate purpose to discriminate, but was based on the belief that an alien cannot be sufficiently acquainted with 'our institutions and our life as to enable him to appreciate the relation of this particular business to our entire social f abric", and was not, theref ore, invalid. In Ohio ex rel. Clarke vs. Deckebach, 274 U.S. 392, 71 L. ed. 1115 (1926), the U. S. Supreme Court had under consideration an ordinance of the city of Cincinnati prohibiting the issuance of licenses (pools and billiard rooms) to aliens. It held that plainly irrational discrimination against aliens is prohibited, but it does not follow that alien race and allegiance may not bear in some instances such a

relation to a legitimate object of legislation as to be made the basis of permitted classification, and that it could not state that the legislation is clearly wrong; and that latitude must be allowed for the legislative appraisement of local conditions and for the legislative choice of methods for controlling an apprehended evil. The case of State vs. Carrol, 124 N. E. 129 (Ohio, 1919) is a parallel case to the one at bar. In Asakura, vs. City of Seattle, 210 P. 30 (Washington, 1922), the business of pawnbroking was considered as having tendencies injuring public interest, and limiting it to citizens is within the scope of police power. A similar statute denying

1180


aliens the right to engage in auctioneering was also sustained in Wright vs. May, L. R. A., 1915 P. 151 (Minnesota, 1914). So also in Anton vs. Van Winkle, 297 F. 340 (Oregon, 1924), the court said that aliens are judicially known to have different interests, knowledge, attitude, psychology and loyalty, hence the prohibition of issuance of licenses to them for the business of pawnbroker, pool, billiard, card room, dance hall, is not an infringement of constitutional rights. In Templar vs. Michigan State Board of Examiners, 90 N.W. 1058 (Michigan, 1902), a law prohibiting the licensing of aliens as barbers was held void, but the reason for the decision was the court's finding that the exercise of the business by the aliens does not in any way affect the morals, the health, or even the convenience of the community. In Takahashi vs. Fish and Game Commission, 92 L. ed. 1479 (1947), a California statute banning the issuance of commercial fishing licenses to persons ineligible to

citizenship was held void, because the law conflicts with Federal power over immigration, and because there is no public interest in the mere claim of ownership of the waters and the fish in them, so there was no adequate justification for the discrimination. It further added that the law was the outgrowth of antagonism toward persons of Japanese ancestry. However, two Justices dissented on the theory that fishing rights have been treated traditionally as natural resources. In Fraser vs. McConway & Tarley Co., 82 Fed. 257 (Pennsylvania, 1897), a state law which imposed a tax on every employer of foreign-born unnaturalized male persons over 21 years of age, was declared void because the court found that there was no reason for the classification .and the tax was an arbitrary deduction from the daily wage of an employee.d. Authorities contra explained.—It is true that some decisions of the Federal court and of the State courts in the United States hold that the distinction between aliens and citizens is not a valid

1181


ground for classification. But in these decisions the laws declared invalid were found to be either arbitrary, unreasonable or capricious, or were the result or product of racial antagonism and hostility, and there was no question of public interest involved or pursued. In Yu Cong Eng vs. Trinidad, 70 L. ed. 1059 (1925), the United States Supreme Court declared invalid a Philippine law making unlawful the keeping of books of account in any language other than English, Spanish or any other local dialect, but the main reasons for the decisions are: (1) that if Chinese were driven

out of business there would be no other system of distribution, and (2) that the Chinese would fall prey to all kinds of fraud, because they would be deprived of their right to be advised of their business and to direct its conduct. The real reason for the decision, therefore, is the court's belief that no public benefit would be derived from the operation of the law and on the other hand it would deprive Chinese of something indispensable for carrying on their business. In Yick Wo vs. Hopkins, 30 L. ed. 220 (1885) an ordinance conferring power on officials to withhold consent in the operation of laundries both as to persons and place, was declared invalid, but the court said that the power granted was arbitrary, that there was no reason for the discrimination which attended the administration and implementation of the law, and that the motive thereof was mere racial hostility. In State vs. Montgomery, 47 A. 165 (Maine, 1900), a law prohibiting aliens to engage as hawkers and peddlers was declared void, because the discrimination bore no reasonable and just relation to the act in respect to which the classification was proposed.

The case at bar is radically different, and the facts make them so. As we already have said, aliens do not naturally possess the sympathetic consideration and regard for customers with whom they come in daily contact, nor the patriotic desire to help bolster the nation's economy, except in so far as it enhances their profit,

1182

1182 PHILIPPINE REPORTS ANNOTATEDIchong etc.. et al. vs. Hernandez, etc., and Sarmiento

nor the loyalty and allegiance which the national owes to the land. These limitations on the qualifications of aliens have been shown on many occasions and instances, especially in

times of crisis and emergency. We can do no better than borrow the language of Anton vs. Van Winkle, 297 F. 340, 342, to drive home the reality and significance of the distinction between the alien and the national, thus:"* * *. It may be judicially known, however, that aliens coming into this country are without the intimate knowledge of our laws, customs, and usages that our own people have. So it is likewise known that certain classes of aliens are of different psychology from our fellow countrymen. Furthermore, it is natural and reasonable to suppose that the foreign born, whose allegiance is first to their own country, and whose ideals of governmental environment and control have been engendered and formed under entirely different regimes and political systems, have not the same inspiration for the public weal, nor are they as well disposed toward the United States, as those who by citizenship, are a part of the government itself. Further enlargement, is unnecessary. I have said enough so that obviously it cannot be affirmed with absolute confidence that the Legislature was without plausible reason for making the classification, and therefore appropriate discrimination against aliens as it relates to the subject of legislation. * * *."VII The Due Process of Law Limitationa. Reasonability, the test of the limitation; determination by legislature decisive.—We now come to due process as a limitation on the exercise of the police power. It has been stated by the highest authority in the United States that:"* * * And the guaranty of due process, as has often been held, demands only that the law shall not be unreasonable, arbitrary or capricious, and that the means selected shall have a real and substantial relation to the subject sought to be attained. * * *."

* * * * * * *"So far as the requirement of due process is concerned

and in the absence of other constitutional restriction a state is free to adopt whatever economic policy may reasonably be deemed to promote public welfare, and to enforce that policy by legislation adapted

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VOL. 101, MAY 31, 1957 1183Ichong etc., et al. vs. Hernandez, etc., and Sarmiento

to its purpose. The courts are without authority either to declare such policy, or, when it is declared by the legislature, to override it. If the laws passed are seen to have a reasonable relation to a proper legislative purpose, and are neither arbitrary nor discriminatory, the requirements of due process are satisfied, and judicial determination to that effect renders a court functus officio. * * *." (Nebbia vs. New York, 78 L. ed. 940, 950, 957.)Another authority states the principle thus:

"* * *. Too much significance cannot be given to the word 'reasonable' in considering the scope of the police power in a constitutional sense, for the test used to determine the constitutionality of the means employed by the legislature is to inquire whether the restrictions it imposes on rights secured to individuals by the Bill of Rights are unreasonable, and not whether it imposes any restrictions on such rights. * * *."

* * * * * * *"* * *. A statute to be within this power must also be

reasonable in its operation upon the persons whom it affects, must not be for the annoyance of a particular class, and must not be unduly oppressive." (11 Am. Jur. Sec. 302, pp. 1074-1075.)

In the case of Lawton vs. Steele, 38 L. ed. 385, 388, it was also held:"* * *. To justify the state in thus interposing its authority in behalf of the public, it must appear, first, that the interests of the public generally, as distinguished from those of a particular class, require such interference; and second, that the means are reasonably necessary for the accomplishment of the purpose, and -not unduly oppressive upon individuals. * * *."Prata Undertaking Co. vs. State Board of Embalming, 104 ALR, 389, 395, fixes this test of constitutionality:"In determining whether a given act of the Legislature, passed in the exercise of the police power to regulate the operation of a business, is or is not constitutional, one of the first questions to be considered by the court is whether the power as exercised has a sufficient foundation in reason in connection with the matter involved, or is an arbitrary, oppressive, and capricious use of that power, without substantial relation to the health, safety, morals, comfort, and general welfare of the public."

1184

1184 PHILIPPINE REPORTS ANNOTATEDlchong etc., et al. vs. Hernandez, etc., and Sarmiento

b. Petitioner's argument considered.—Petitioner's main argument is that retail is a common, ordinary occupation, one of those privileges long ago recognized as essential to the orderly pursuit of happiness by free men; that it is a gainful and honest occupation and therefore beyond the power of the legislature to prohibit and penalize. This argument overlooks fact and reality and rests on an incorrect assumption and premise, i.e., that in this country where the occupation is engaged in by petitioner, it

has been so engaged by him, by the alien, in an honest creditable and unimpeachable manner, without harm or injury to the citizens and without ultimate danger to their economic peace, tranquility and welfare. But the Legislature has found, as we have also found and indicated, that the privilege has been so grossly abused by the alien, thru the illegitimate use of pernicious designs and practices, that he now enjoys a monopolistic control of the occupation and threatens a deadly stranglehold on the nation's economy endangering the national security in times of crisis and emergency.

The real question at issue, therefore, is not that posed by petitioner, which overlooks and ignores the facts and circumstances, but this, Is the exclusion in the future of aliens from the retail trade unreasonable, arbitrary and capricious, taking into account the illegitimate and pernicious form and manner in which the aliens have heretofore engaged therein? As thus correctly stated the answer is clear. The law in question is deemed absolutely necessary to bring about the desired legislative objective, i.e., to free national economy from alien control and do minance. It is not necessarily unreasonable because it affects private rights and privileges (11 Am. Jur. pp. 1080-1081.) The test of reasonableness of a law is the appropriateness or adequacy under all circumstances of the means adopted to carry out its purpose into effect (Id.) Judged by this test, disputed legislation, which is

1185


not merely reasonable but actually necessary, must be considered not to have infringed the constitutional limitation

of reasonableness.The necessity of the law in question is explained in the

explanatory note that accompanied the bill, which later was enacted into law:"This bill proposes to regulate the retail business. Its purpose is to prevent persons who are not citizens of the Philippines from having a strangle hold upon our economic life. If the persons who control this vital artery of our economic life are the ones who owe no allegiance to this Republic, who have no profound devotion to our free institutions, and who have no permanent stake in our people's welfare, we are not really the masters of our own destiny. All aspects of our life, even our national security, will be at the mercy of other people.

"In seeking to accomplish the foregoing purpose, we do not propose to deprive persons who are not citizens of the Philippines of their means of livelihood. While this bill seeks to take away from the hands of persons who are not citizens of the Philippines a power that can be wielded to paralyze all aspects of our national life and endanger our national security it respects existing rights.

"The approval of this bill is 'necessary for our national survival."If political independence is a legitimate aspiration of a people, then economic independence is none the less legitimate. Freedom and liberty are not real and positive if the people are subject to the economic control and domination of others, especially if not of their own race or country. The removal and eradication of the shackles of foreign economic control and domination, is one of the noblest motives that a national legislature may pursue. It is impossible to conceive that legislation that seeks to bring it about can infringe the constitutional limitation of due process. The attainment of a legitimate aspiration of a people

can never be beyond the limits of legislative authority.c. Law expressly held by Constitutional Convention to be within the sphere of legislative action.—The framers of the Constitution could not have intended to impose the constitutional restrictions of due

1186


process on the attainment of such a noble motive as freedom from economic control and domination, thru the exercise of the police power. The fathers of the Constitution must have given to the legislature full authority and power to enact legislation that would promote the supreme happiness of the people, their freedom and liberty. On the precise issue now before us, they expressly made their voice clear; they adopted a resolution expressing their belief that the legislation in question is within the scope of the legislative power. Thus they declared in their Resolution:" That it is the sense of the Convention that the public interest requires the nationalization of retail trade; but it abstains from approving the amendment introduced by the Delegate for Manila, Mr. Araneta, and others on this matter because it is convinced that the National Assembly is authorized to promulgate a law which limits to Filipino and American citizens the privilege to engage in the retail trade.'" (II Aruego, The Framing of the Philippine Constitution, 662-663, quoted on pages 66 and 67 of the Memorandum for the Petitioner.)It would do well to refer to the nationalistic tendency manifested in various provisions of the Constitution. Thus in the preamble, a principal objective is the conservation of the patrimony of the nation and as corollary thereto the

provision limiting to citizens of the Philippines the exploitation, development and utilization of its natural resources. And in Section 8 of Article XIV, it is provided that "no franchise, certificate, or any other form of authorization for the operation of a public utility shall be granted except to citizens of the Philippines." The nationalization of the retail trade is only a continuance of the nationalistic protective policy laid down as a primary objective of the Constitution. Can it be said that a law imbued with the same purpose and spirit underlying many of the provisions of the Constitution is unreasonable, invalid and unconstitutional ?

The seriousness of the Legislature's concern for the plight of the nationals as manifested in the approval

1187


of the radical measure is, therefore, fully justified. It would have been recreant to its duties towards the country and its people would it view the sorry plight of the nationals with complacency and refuse or neglect to adopt a remedy commensurate with the demands of public interest and national survival. As the repository of the sovereign power of legislation, the Legislature was in duty bound to face the problem and meet, through adequate measures, the danger and threat that alien domination of retail trade poses to national economy.d. Provisions of law not unreasonable.—A cursory study of the provisions of the law immediately reveals how tolerant, how reasonable the Legislature has been. The law is made prospective and recognizes the right and privilege of those already engaged in the occupation to

continue therein during the rest of their lives; and similar recognition of the right to continue is accorded associations of aliens. The right or privilege is denied to those only upon conviction of certain offenses. In the deliberations of the Court on this case, attention was called to the fact that the privilege should not have been denied to children and heirs of aliens now engaged in the retail trade. Such provision would defeat the law itself, its aims and purposes. Besides, the exercise of legislative discretion is not subject to judicial review. It is well settled that the Court will not inquire into the motives of the Legislature, nor pass upon general matters of legislative judgment. The Legislature is primarily the judge of the necessity of an enactment or of any of its provisions, and every presumption is in favor of its validity, and though the Court may hold views inconsistent with the wisdom of the law, it may not annul the legislation if not palpably in excess of the legislative power. Furthermore, the test of the validity of a law attacked as a violation of due process, is not its reasonableness, but its unreasonableness, and we find

1188


he provisions are not unreasonable. These principles also answer various other arguments raised against the law, some of which are: that the law does not promote general welfare; that thousands of aliens would be thrown out of employment; that prices will increase because of the elimination of competition; that there is no need for the legislation; that adequate replacement is problematical; that there may be general breakdown; that there would be repercussions from foreigners; etc. Many of these arguments

are directed against the supposed wisdom of the law which lies solely within the legislative prerogative; they do not import invalidity.VIII. Alleged defect in the title of the lawA subordinate ground or reason for the alleged invalidity of the law is the claim that the title thereof is misleading or deceptive, as it conceals the real purpose of the bill, which is to nationalize the retail business and prohibit aliens from engaging therein. The constitutional provision which is claimed to be violated in Section 21 (1) of Article VI, which reads:"No bill which may be enacted into law shall embrace more than one subject which shall be expressed in the title of the bill."What the above provision prohibits is duplicity, that is, if its title completely fails to apprise the legislators or the public of the nature, scope and consequences of the law or its operation (I Sutherland, Statutory Construction, Sec. 1707, p. 297.) A cursory consideration of the title and the provisions of the bill fails to show the presence of duplicity. It is true that the term "regulate" does not and may not readily and at first glance convey the idea of "nationalization" and "prohibition", which terms express the two main purposes and objectives of the law. But "regulate" is a broader term than either prohibition or nationalization. Both of these have always been included within the term regulation.

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VOL. 101, MAY 31, 1957lchong etc., et al. vs. Hernandez, etc., and Sarmiento

"Under the title of an act to 'regulate', the sale of intoxicating liquors, the Legislature may prohibit the sale of intoxicating

liquors." (Sweet vs. City of Wabash, 41 Ind., 7; quoted in page 41 of Answer.)

"Within the meaning of the Constitution requiring that the subject of every act of the Legislature shall be stated in the title, the title To regulate the sale of intoxicating liquors, etc." sufficiently expresses the subject of an act prohibiting the sale of such liquors to minors and to persons in the habit of getting intoxicated; such matters being properly included within the subject of regulating the sale." (Williams vs. State, 48 Ind. 306, 308, quoted in p. 42 of Answer.)

"The word 'regulate' is of broad import, and necessarily implies some degree of restraint and prohibition of acts usually done in connection with the thing to be regulated. While word regulate' does not ordinarily convey meaning of prohibit, there is no absolute reason why it should not have such meaning when used in delegating police power in connection with a thing the best or only efficacious regulation of which involves suppression." (State vs. Morton, 162 So. 718, 182 La. 887, quoted in p. 42 of Answer.)The general rule is for the use of general terms in the title of a bill; it has also been said that the title need not be an index to the entire contents of the law (I Sutherland, Statutory Construction, Sec. 4803, p. 345.) The above rule was followed when the title of the Act in question adopted the more general term "regulate" instead of "nationalize" or "prohibit". Furthermore, the law also contains other rules for the regulation of the retail trade, which may not be included in the terms "nationalization" or "prohibition"; so were the title changed from "regulate" to "nationalize" or "prohibit", there would have been many provisions not f alling within the scope of the title which would have made the Act invalid. The use of the term "regulate", therefore, is in

accord with the principle governing the drafting of statutes, under which a simple or general term should be adopted in the title, which would include all other provisions found in the body of the Act.

One purpose of the constitutional directive that the subject of a bill should be embraced in its title is to apprise the legislators of the purposes, the nature and scope of its provisions, and prevent the enactment into law of matters

1190


which have not received the notice, action and study of the legislators or of the public. In the case at bar it cannot be claimed that the legislators have not been apprised of the nature of the law, especially the nationalization and prohibition provisions. The legislators took active interest in the discussion of the law, and a great many of the persons affected by the prohibition in the law conducted a campaign against its approval. It cannot be claimed, therefore, that the reasons for declaring the law invalid ever existed. The objection must therefore, be overruled.IX. Alleged violation of international treaties and obligationsAnother subordinate argument against the validity of the law is the supposed violation thereby of the Charter of the United Nations and of the Declaration of Human Rights adopted by the United Nations General Assembly. We find no merit in the above contention. The United Nations Charter imposes no strict or legal obligations regarding the rights and freedom of their subjects (Hans Kelsen, The Law of the United Nations, 1951 ed. pp. 2932), and the Declaration of Human Rights contains nothing more than a

mere recommendation, or a common standard of achievement for all peoples and all nations (Id. p. 39.) That such is the import of the United Nations Charter aid of the Declaration of Human Rights can be inferred from the fact that members of the United Nations Organization, such as Norway and Denmark, prohibit foreigners from engaging in retail trade, and in most nations of the world laws against foreigners engaged in domestic trade are adopted.

The Treaty of Amity between the Republic of the Philippines and the Republic of China of April 18, 1947 is also claimed to be violated by the law in question. All that the treaty guarantees is equality of treatment to the Chinese nationals "upon the same terms as the nationals of any other country." But the nationals of China are not dis-

1191


criminated against because nationals of all other countries, except those of the United States, who are granted special rights by the Constitution, are all prohibited f rom engaging in the retail trade. But even supposing that the law infringes upon the said treaty, the treaty is always subject to qualification or amendment by a subsequent law (U. S. vs. Thompson, 258, Fed. 257, 260), and the same may never curtail or restrict the scope of the police power of the State (Palston vs. Pennsylvania, 58 L. ed. 539.)X. ConclusionResuming what we have set forth above we hold that the disputed law was enacted to remedy a real actual threat and danger to national economy posed by alien dominance and control of the retail business and free citizens and country from such dominance and control; that the enactment clearly

falls within the scope of the police power of the State, thru which and by which it protects its own personality and insures its security and future; that the law does not violate the equal protection clause of the Constitution because sufficient grounds exist for the distinction between alien and citizen in the exercise of the occupation regulated, nor the due process of law clause, because the law is prospective in operation and recognizes the privilege of aliens already engaged in the occupation and reasonably protects their privilege; that the wisdom and efficacy of the law to carry out its objectives appear to us to be plainly evident—as a matter of f act it seems not only appropriate but actually necessary—and that in any case such matter falls within the prerogative of the Legislature, with whose power and discretion the Judicial department of the Government may not interfere; that the provisions of the law are clearly embraced in the title, and this suffers from no duplicity and has not misled the legislators or the segment of the population affected; and that it cannot be said to be void for supposed conflict with treaty obligations because no treaty has actually been en-

1192


tered into on the subject and the police power may not be curtailed or surrendered by any treaty or any other conventional agreement.

Some members of the Court are of the opinion that the radical effects of the law could have been made less harsh in its impact on the aliens. Thus it is stated that more time should have been given in the law for the liquidation of existing businesses when the time comes for them to close.

Our legal duty, however, is merely to determine if the law falls within the scope of legislative authority and does not transcend the limitations of due process and equal protection guaranteed in the Constitution. Remedies against the harshness of the law should be addressed to the Legislature; they are beyond our power and jurisdiction.

The petition is hereby denied, with costs against petitioner.

Parás, C. J., Bengzon, Reyes, A., Bautista Angelo, Concepción, Reyes, J. B. L., Endencia, and Felix, JJ., concur.PADILLA, J., concurring and dissenting:

I agree to the proposition, principle or rule that courts may not inquire into the wisdom of an Act passed by the Congress and duly approved by the President of the Republic. But the rule does not preclude courts from inquiring and determining whether the Act offends against a provision or provisions of the Constitution. I am satisfied that the Act assailed as violative of the due process of law and the equal protection of the laws clauses of the Constitution does not infringe upon them, insofar as it affects associations, partnerships or corporations, the capital of which is not wholly owned by citizens of the Philippines, and aliens, who are not and have not been engaged in the retail business. I am, however, unable to persuade myself that it does not violate said clauses insofar as the Act applies to associations and partnerships referred to in the Act and to aliens, who are and have

1193


heretofore been engaged in said business. When they did engage in the retail business there was no prohibition on or against them to engage in it. They assumed and believed in good faith they were entitled to engage in the business. The Act allows aliens to continue in business until their death or voluntary retirement f rom the business or forfeiture of their license; and corporations, associations or partnerships, the capital of which is not wholly owned by citizens of the Philippines to continue in the business for a period of ten years from the date of the approval of the Act (19 June 1954) or until the expiry of the term of the existence of the association or partnership or corporation, whichever event comes first. The prohibition on corporations, the capital of which is not wholly owned by citizens of the Philippines, to engage in the retail business for a period of more than ten years from the date of the approval of the Act or beyond the term of their corporate existence, whichever event comes first, is valid and lawful, because the continuance of the existence of such corporations is subject to whatever the Congress may impose reasonably upon them by subsequent legislation.1 But the prohibition to engage in the retail business by associations and partnerships, the capital of which is not wholly owned by citizens of the Philippines, after ten years from the date of the approval of the Act, even bef ore the end of the term of their existence as agreed upon by the associates and partners, and by alien heirs to whom the retail business is transmitted by the death of an alien engaged in the business, or by his executor or administrator, amounts to a deprivation of their property without due process of law. To my mind, the ten-year period from the date of the approval of the Act or until the expiration of the term of the existence of the association and partnership, whichever event comes first, and the sixmonth period

granted to alien heirs of a deceased alien,________________

1 Section 76, Act No. 1459.1194

1194 PHILIPPINE REPORTS ANNOTATEDIchong etc., et al. vs. Hernandez, etc,, and Sarmiento

his executor or administrator, to liquidate the business, do not cure the defect of the law, because the effect of the prohibition is to compel them to sell or dispose of their business. The price obtainable at such forced sale of the business would be inadequate to reimburse and compensate the associates or partners of the association or partnership, and the alien heirs of a deceased alien, engaged in the retail business for the capital invested in it. The stock of merchandise bought and sold at retail does not alone constitute the business. The goodwill that the association, partnership and the alien had built up during a long period of effort, patience and perseverance forms part of such business. The constitutional provisions that no person shall be deprived of his property without due process of law 1 and that no person shall be denied the equal protection of the laws 2 would have no meaning as applied to associations or partnerships and alien heirs of an alien engaged in the retail business if they were to be compelled to sell or dispose of their business within ten years from the date of the approval of the Act and before the end of the term of the existence of the associations and partnerships as agreed upon by the associates and partners and within six months after the death of their predecessorin-interest.

The authors of the Constitution were vigilant, caref ul and zealous in the safeguard of the ownership of private agricultural lands which together with the lands of the public

domain constitute the priceless patrimony and mainstay of the nation; yet, they did not deem it wise and prudent to deprive aliens and their heirs of such lands,3

For these reasons, I am of the opinion that section 1 of the Act, insofar as it compels associations and partnerships referred to therein to wind up their retail business within ten years from the date of the approval of the Act________________

1 Section 1(1), Article III, of the Constitution.2 Ibid.3 Section 5, Article XIII, of the Constitution.

1195

VOL. 101, MAY 81. 1957Ichong etc., et al. vs. Hernandez, etc., and Sarmiento

even before the expiry of the term of their existence as agreed upon by the associates and partners and section 3 of the Act, insofar as it compels the alien heirs of a deceased alien engaged in the retail business in his lifetime, his executor or administrator, to liquidate the business, are invalid, for they violate the due process of law and the equal protection of the laws clauses of the Constitution.

Petition denied.—————

© Copyright 2014 Central Book Supply, Inc. All rights reserved.

208

SUPREME COURT REPORTS ANNOTATED

Tio vs. Videogram Regulatory BoardNo. L-75697. June 18, 1987.*

VALENTIN TIO doing business under the name and style of OMI ENTERPRISES, petitioner, vs. VIDEOGRAM REGULATORY BOARD, MINISTER OF FINANCE, METRO MANILA COMMISSION, CITY MAYOR and CITY TREASURER OF MANILA, respondents.

Constitutional Law; Constitutional requirement that “every bill shall embrace only one subject which shall be expressed in the title thereof’ is sufficiently complied with if the title be comprehensive enough to include the general purpose it seeks to achieve and if all the parts of the statute

are related and germane to the subject matter expressed in the title or as long as they are not inconsistent with or foreign to the general subject and title.—The Constitutional requirement that “every bill shall embrace only one subject which shall be expressed in the title thereof” is sufficiently complied with if the title be comprehensive enough to include the general purpose which a statute seeks to achieve. It is not necessary that the title express each and every end that the statute wishes to accomplish. The requirement is satisfied if all the parts of the statute are related, and are germane to the subject matter expressed in the title, or as long as they are not inconsistent with or foreign to the general subject and title. An act having a single general subject, indicated in the title, may contain any number of provisions, no matter how diverse they may be, so long as they are not inconsistent with or foreign to the general subject, and may be considered in furtherance of such subject by providing for the method and means of carrying out the general object.” The rule also is that the constitutional requirement as to the title of a bill should not be so narrowly construed as to cripple or impede the_______________

* EN BANC.

209

VOL. 151, JUNE 18, 1987Tio vs. Videogram Regulatory Board

power of legislation. It should be given a practical rather than technical construction.

Same; Same; Section 10 PD 1987 otherwise known as Videogram Regulatory Board is not a Rider.—Section 10.

Tax on Sale, Lease or Disposition of Videograms. Notwithstanding any provision of law to the contrary, the province shall collect a tax of thirty percent (30%) of the purchase price or rental rate, as the case may be, for every sale, lease or disposition of a videogram containing a reproduction of any motion picture or audiovisual program. Fifty percent (50%) of the proceeds of the tax collected shall accrue to the province, and the other fifty percent (50%) shall accrue to the municipality where the tax is collected; PROVIDED, That in Metropolitan Manila, the tax shall be shared equally by the City/Municipality and the Metropolitan Manila Commission. x x x x” The foregoing provision is allied and germane to, and is reasonably necessary for the accomplishment of, the general object of the DECREE, which is the regulation of the video industry through the Videogram Regulatory Board as expressed in its title. The tax provision is not inconsistent with, nor foreign to that general subject and title. As a tool for regulation it is simply one of the regulatory and control mechanisms scattered throughout the DECREE. The express purpose of the DECREE to include taxation of the video industry in order to regulate and rationalize the heretofore uncontrolled distribution of videograms is evident from Preambles 2 and 5, supra. Those preambles explain the motives of the lawmaker in presenting the measure. The title of the DECREE, which is the creation of the Videogram Regulatory Board, is comprehensive enough to include the purposes expressed in its Preamble and reasonably covers all its provisions. It is unnecessary to express all those objectives in the title or that the latter be an index to the body of the DECREE,

Same; Same; Same; Tax imposed under the Decree is not harsh; oppressive, confiscatory and in restraint of trade

but regulatory and a revenue measure; The levy is for a public purpose.—Petitioner also submits that the thirty percent (30%) tax imposed is harsh and oppressive, confiscatory, and in restraint of trade. However, it is beyond serious question that a tax does not cease to be valid merely because it regulates, discourages, or even definitely deters the activities taxed. The power to impose taxes is one so unlimited in force and so searching in extent, that the courts scarcely venture to declare that it is subject to any restrictions whatever, except such as rest in the discretion of the authority which exercises it. In imposing

210

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Tio vs. Videogram Regulatory Boarda tax, the legislature acts upon its constituents. This is, in general, a sufficient security against erroneous and oppressive taxation. The tax imposed by the DECREE is not only a regulatory but also a revenue measure prompted by the realization that earnings of videogram establishments of around P600 million per annum have not been subjected to tax, thereby depriving the Government of an additional source of revenue. It is an end-user tax, imposed on retailers for every videogram they make available for public viewing, It is similar to the 30% amusement tax imposed or borne by the movie industry which the theater-owners pay to the government, but which is passed on to the entire cost of the admission ticket, thus shifting the tax burden on the buying or the viewing public. It is a tax that is imposed uniformly on all videogram operators. The levy of the 30% tax is for a public purpose. It was imposed primarily to answer the need

for regulating the video industry, particularly because of the rampant film piracy, the flagrant violation of intellectual property rights, and the proliferation of pornographic video tapes. And while it was also an objective of the DECREE to protect the movie industry, the tax remains a valid imposition.

Same; Same; Same; Same; PD 1987 not an undue delegation of legislative power.—Neither can it be successfully argued that the DECREE contains an undue delegation of legislative power. The grant in Section 11 of the DECREE of authority to the BOARD to “solicit the direct assistance of other agencies and Units of the government and deputize, for a fixed and limited period, the heads or personnel of such agencies and units to perform enforcement functions for the Board” is not a delegation of the power to legislate but merely a conferment of authority or discretion as to its execution, enforcement, and implementation. “The true distinction is between the delegation of power to make the law, which necessarily involves a discretion as to what it shall be, and conferring authority or discretion as to its execution to be exercised under and in pursuance of the law. The first cannot be done; to the latter, no valid objection can be made.” Besides, in the very language of the decree, the authority of the BOARD to solicit such assistance is for a “fixed and limited period” with the deputized agencies concerned being “subject to the direction and control of the BOARD.” That the grant of such authority might be the source of graft and corruption would not stigmatize the DECREE as unconstitutional. Should the eventuality occur, the aggrieved parties will not be without adequate remedy in law.

211

VOL. 151, JUNE 18, 1987

Tio vs. Videogram Regulatory BoardPETITION to review the decision of the Metro Manila Commission.

The facts are stated in the opinion of the Court. Nelson Y. Ng for petitioner. The City Legal Officer for respondents City Mayor

and City Treasurer.MELENCIO-HERRERA, J.:

This petition was filed on September 1, 1986 by petitioner on his own behalf and purportedly on behalf of other videogram operators adversely affected. It assails the constitutionality of Presidential Decree No. 1987 entitled “An Act Creating the Videogram Regulatory Board” with broad powers to regulate and supervise the videogram industry (hereinafter briefly referred to as the BOARD). The Decree was promulgated on October 5, 1985 and took effect on April 10, 1986, fifteen (15) days after completion of its publication in the Official Gazette.

On November 5, 1985, a month after the promulgation of the abovementioned decree, Presidential Decree No. 1994 amended the National Internal Revenue Code providing, inter alia:“SEC. 134. Video Tapes.—There shall be collected on each processed video-tape cassette, ready for playback, regardless of length, an annual tax of five pesos; Provided, That locally manufactured or imported blank video tapes shall be subject to sales tax.”On October 23, 1986, the Greater Manila Theaters Association, Integrated Movie Producers, Importers and Distributors Association of the Philippines, and Philippine Motion Pictures Producers Association, hereinafter

collectively referred to as the Intervenors, were permitted by the Court to intervene in the case, over petitioner’s opposition, upon the allegations that intervention was necessary for the complete protection of their rights and that their “survival and very existence is threatened by the unregulated proliferation of film piracy.” The Intervenors were thereafter allowed to file their Comment in Intervention.

212

212


Tio vs. Videogram Regulatory BoardThe rationale behind the enactment of the DECREE, is set out in its preambular clauses as follows:

2.“1.WHEREAS, the proliferation and unregulated circulation of videograms including, among others,

videotapes, discs, cassettes or any technical improvement or variation thereof, have greatly prejudiced the operations of movie houses and

theaters, and have caused a sharp decline in theatrical attendance by at least forty percent (40%) and a

tremendous drop in the collection of sales, contractor’s specific, amusement and other taxes,

thereby resulting in substantial losses estimated at P450 Million annually in government revenues;

3.“2.WHEREAS, videogram(s) establishments collectively earn around P600 Million per annum from rentals,

sales and disposition of videograms, and such earnings have not been subjected to tax, thereby

depriving the Government of approximately P180 Million in taxes each year;

4.“3.WHEREAS, the unregulated activities of videogram

establishments have also affected the viability of the movie industry, particularly the more than 1,200

movie houses and theaters throughout the country, and occasioned industry-wide displacement and

unemployment due to the shutdown of numerous movie houses and theaters;

5.“4.“WHEREAS, in order to ensure national economic recovery, it is imperative for the Government to create an environment conducive to growth and development

of all business industries, including the movie industry which has an accumulated investment of

about P3 Billion;6.“5.WHEREAS, proper taxation of the activities of videogram establishments will not only alleviate the dire financial condition of the movie industry upon

which more than 75,000 families and 500,000 workers depend for their livelihood, but also provide an

additional source of revenue for the Government, and at the same time rationalize the heretofore

uncontrolled distribution of videograms;7.“6.WHEREAS, the rampant and unregulated showing of

obscene videogram features constitutes a clear and present danger to the moral and spiritual well-being of the youth, and impairs the mandate of the Constitution

for the State to support the rearing of the youth for civic efficiency and the development of moral

character and promote their physical, intellectual, and social well-being;

8.“7.WHEREAS, civic-minded citizens and groups have called for remedial measures to curb these blatant

malpractices which have213

VOL. 151, JUNE 18, 1987

Tio vs. Videogram Regulatory Board2.flaunted our censorship and copyright laws;

3.“8.WHEREAS, in the face of these grave emergencies corroding the moral values of the people and

betraying the national economic recovery program, bold emergency measures must be adopted with

dispatch; x x x” (Numbering of paragraphs supplied).Petitioner’s attack on the constitutionality of the DECREE rests on the following grounds:

2.“1.Section 10 thereof, which imposes a tax of 30% on the gross receipts payable to the local government is a RIDER and the same is not germane to the subject

matter thereof;3.“2.The tax imposed is harsh, confiscatory, oppressive

and/or in unlawful restraint of trade in violation of the due process clause of the Constitution;

4.“3.There is no factual nor legal basis for the exercise by the President of the vast powers conferred upon him

by Amendment No. 6;5.“4.There is undue delegation of power and authority;

6.“5.The Decree is an ex-post facto law; and7.“6.There is over regulation of the video industry as if it

were a nuisance, which it is not.”We shall consider the foregoing objections in seriatim.

1. The Constitutional requirement that “every bill shall embrace only one subject which shall be expressed in the title thereof”1 is sufficiently complied with if the title be comprehensive enough to include the general purpose which a statute seeks to achieve. It is not necessary that the title express each and every end that the statute wishes to accomplish. The requirement is satisfied if all the parts of the statute are related, and are germane to the subject matter expressed in the title, or as long as they are not inconsistent

with or foreign to the general subject and title.2 An act having a_______________

1 Section 19[1], Article VIII, 1973 Constitution; Section 26[1], Article VI, 1987 Constitution.

2 Sumulong vs. COMELEC, No. 48609, October 10, 1941, 73 Phil. 288; Cordero vs. Hon. Jose Cabatuando, et al., L-14542, Oct. 31, 1962, 6 SCRA 418.

214

214


Tio vs. Videogram Regulatory Boardsingle general subject, indicated in the title, may contain any number of provisions, no matter how diverse they may be, so long as they are not inconsistent with or foreign to the general subject, and may be considered in furtherance of such subject by providing for the method and means of carrying out the general object.”3 The rule also is that the constitutional requirement as to the title of a bill should not be so narrowly construed as to cripple or impede the power of legislation.4 It should be given a practical rather than technical construction.5

Tested by the foregoing criteria, petitioner’s contention that the tax provision of the DECREE is a rider is without merit. That section reads, inter alia:“Section 10. Tax on Sale, Lease or Disposition of Videograms.—Notwithstanding any provision of law to the contrary, the province shall collect a tax of thirty percent (30%) of the purchase price or rental rate, as the case may be, for every sale, lease or disposition of a videogram containing a reproduction of any motion picture or audiovisual program. Fifty percent (50%) of the proceeds of

the tax collected shall accrue to the province, and the other fifty percent (50%) shall acrrue to the municipality where the tax is collected; PROVIDED, That in Metropolitan Manila, the tax shall be shared equally by the City/Municipality and the Metropolitan Manila Commission.

x x xThe foregoing provision is allied and germane to, and is reasonably necessary for the accomplishment of, the general object of the DECREE, which is the regulation of the video industry through the Videogram Regulatory Board as expressed in its title. The tax provision is not inconsistent with, nor foreign to that general subject and title. As a tool for regulation6 it is simply one of the regulatory and control mechanisms_______________

3 Public Service Co., Recktenwald, 290 111. 314, 8 A.L.R 466, 470.

4 Government vs. Hongkong & Shanghai Banking Corporation, No. 44257, November 22, 1938, 66 Phil. 483; Cordero vs. Cabatuando, et al., supra.

5 Sumulong vs. Commission on Elections, supra.6 United States vs. Sanchez, 340 U.S. 42, 44, 1950, cited

in Bernas, Philippines Constitutional Law, p. 594.215


scattered throughout the DECREE. The express purpose of the DECREE to include taxation of the video industry in order to regulate and rationalize the heretofore uncontrolled distribution of videograms is evident from Preambles 2 and 5, supra. Those preambles explain the motives of the lawmaker in presenting the measure. The title of the

DECREE, which is the creation of the Videogram Regulatory Board, is comprehensive enough to include the purposes expressed in its Preamble and reasonably covers all its provisions. It is unnecessary to express all those objectives in the title or that the latter be an index to the body of the DECREE.7

2. Petitioner also submits that the thirty percent (30%) tax imposed is harsh and oppressive, confiscatory, and in restraint of trade. However, it is beyond serious question that a tax does not cease to be valid merely because it regulates, discourages, or even definitely deters the activities taxed.8 The power to impose taxes is one so unlimited in force and so searching in extent, that the courts scarcely venture to declare that it is subject to any restrictions whatever, except such as rest in the discretion of the authority which exercises it.9 In imposing a tax, the legislature acts upon its constituents. This is, in general, a sufficient security against erroneous and oppressive taxation.10

The tax imposed by the DECREE is not only a regulatory but also a revenue measure prompted by the realization that earnings of videogram establishments of around P600 million per annum have not been subjected to tax, thereby depriving the Government of an additional source of revenue. It is an end-user tax, imposed on retailers for every videogram they make available for public viewing. It is similar to the 30% amusement tax imposed or borne by the movie industry which the theater-owners pay to the government, but which is passed on to the entire cost of the admission ticket, thus shifting the tax burden on the buying or the viewing public. It is a tax that_______________

7 People vs. Carlos, L-239, June 30, 1947, 78 Phil. 535.

8 U.S. vs. Sanchez, supra.9 II Cooley, A Treatise on the Constitutional Limitations,

p. 986.10 ibid., p. 987.

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Tio vs. Videogram Regulatory Boardis imposed uniformly on all videogram operators.

The levy of the 30% tax is for a public purpose. It was imposed primarily to answer the need for regulating the video industry, particularly because of the rampant film piracy, the flagrant violation of intellectual property rights, and the proliferation of pornographic video tapes. And while it was also an objective of the DECREE to protect the movie industry, the tax remains a valid imposition.“The public purpose of a tax may legally exist even if the motive which impelled the legislature to impose the tax was to favor one industry over another.11

“It is inherent in the power to tax that a state be free to select the subjects of taxation, and it has been repeatedly held that “inequities which result from a singling out of one particular class for taxation or exemption infringe no constitutional limitation.”12 Taxation has been made the implement of the state’s police power.13At bottom, the rate of tax is a matter better addressed to the taxing legislature.

3. Petitioner argues that there was no legal nor factual basis for the promulgation of the DECREE by the former President under Amendment No. 6 of the 1973 Constitution providing that “whenever in the judgment of the President xxx, there exists a grave emergency or a threat or imminence

thereof, or whenever the interim Batasang Pambansa or the regular National Assembly fails or is unable to act adequately on any matter for any reason that in his judgment requires immediate action, he may, in order to meet the exigency, issue the necessary decrees, orders, or letters of instructions, which shall form part of the law of the land.”

In refutation, the Intervenors and the Solicitor General’s_______________

11 Magnano Co. vs. Hamilton, 292, U.S. 40.12 Lutz vs. Araneta, L-7859, December 22, 1955, 98

Phil. 148, citing Carmichael vs. Southern Coal and Coke Co., 301 U.S. 495, 81 L. Ed. 1245.

13 ibid., citing Great Atl. and Pacific Tea Co. vs. Grosjean, 301 U.S. 412, 81 L. Ed. 1193; U.S. vs. Butler, 297 U.S. 1, 80 L. Ed. 477; M’Culloch vs. Maryland, 4 Wheat, 316, 4 L. Ed. 579.

217


Office aver that the 8th “whereas” clause sufficiently summarizes the justification in that grave emergencies corroding the moral values of the people and betraying the national economic recovery program necessitated bold emergency measures to be adopted with dispatch. Whatever the reasons “in the judgment” of the then President, considering that the issue of the validity of the exercise of legislative power under the said Amendment still pends resolution in several other cases, we reserve resolution of the question raised at the proper time.

4. Neither can it be successfully argued that the DECREE contains an undue delegation of legislative power. The grant in Section 11 of the DECREE of authority to the

BOARD to “solicit the direct assistance of other agencies and units of the government and deputize, for a fixed and limited period, the heads or personnel of such agencies and units to perform enforcement functions for the Board” is not a delegation of the power to legislate but merely a conferment of authority or discretion as to its execution, enforcement, and implementation. “The true distinction is between the delegation of power to make the law, which necessarily involves a discretion as to what it shall be, and conferring authority or discretion as to its execution to be exercised under and in pursuance of the law. The first cannot be done; to the latter, no valid objection can be made."14 Besides, in the very language of the decree, the authority of the BOARD to solicit such assistance is for a “fixed and limited period” with the deputized agencies concerned being “subject to the direction and control of the BOARD.” That the grant of such authority might be the source of graft and corruption would not stigmatize the DECREE as unconstitutional. Should the eventuality occur, the aggrieved parties will not be without adequate remedy in law.

5. The DECREE is not violative of the ex post facto principle. An ex post facto law is, among other categories, one which “alters the legal rules of evidence. and authorizes conviction_______________

14 Cincinnati, W. & Z.R. Co. vs. Clinton County Comrs. (1852) 1 Ohio St. 88.

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Tio vs. Videogram Regulatory Boardupon less or different testimony than the law required at the

time of the commission of the offense.” It is petitioner’s position that Section 15 of the DECREE in providing that:“AIl videogram establishments in the Philippines are hereby given a period of forty-five (45) days after the effectivity of this Decree within which to register with and secure a permit from the BOARD to engage in the videogram business and to register with the BOARD all their inventories of videograms, including videotapes, discs, cassettes or other technical improvements or variations thereof, before they could be sold, leased, or otherwise disposed of. Thereafter any videogram found in the possession of any person engaged in the videogram business without the required proof of registration by the BOARD, shall be prima facie evidence of violation of the Decree, whether the possession of such videogram be for private showing and/or public exhibition.”raises immediately a prima facie evidence of violation of the DECREE when the required proof of registration of any videogram cannot be presented and thus partakes of the nature of an ex post facto law.

The argument is untenable. As this Court held in the recent case of Vallarta vs. Court of Appeals, et al.15“x x x it is now well settled that ‘there is no constitutional objection to the passage of a law providing that the presumption of innocence may be overcome by a contrary presumption founded upon the experience of human conduct, and enacting what evidence shall be sufficient to overcome such presumption of innocence’ (People vs. Mingoa, 92 Phil. 856 [1953] at 858–59, citing 1 COOLEY, A TREATISE ON THE CONSTITUTIONAL LIMITATIONS, 639–641). And the ‘legislature may enact that when certain facts have been proved that they shall be prima facie evidence of the existence of the guilt of the

accused and shift the burden of proof provided there be a rational connection between the facts proved and the ultimate facts presumed so that the inference of the one from proof of the others is not unreasonable and arbitrary because of lack of connection between the two in common experience’.”16_______________

15 G.R. No. L-40195, May 29, 1987.16 ibid., citing People vs. Mingoa, supra, See also U.S.

vs. Luling, No. 11162, August 12,1916, 34 Phil. 725.219


Applied to the challenged provision, there is no question that there is a rational connection between the fact proved, which is non-registration, and the ultimate fact presumed which is violation of the DECREE, besides the fact that the prima facie presumption of violation of the DECREE attaches only after a forty-five-day period counted from its effectivity and is, therefore, neither retrospective in character.

6. We do not share petitioner’s fears that the video industry is being over-regulated and being eased out of existence as if it were a nuisance. Being a relatively new industry, the need for its regulation was apparent. While the underlying objective of the DECREE is to protect the moribund movie industry, there is no question that public welfare is at bottom of its enactment, considering “the unfair competition posed by rampant film piracy; the erosion of the moral fiber of the viewing public brought about by the availability of unclassified and unreviewed video tapes containing pornographic films and films with brutally violent sequences; and losses in government revenues due to

the drop in theatrical attendance, not to mention the f act that the activities of video establishments are virtually untaxed since mere payment of Mayor’s permit and municipal license fees are required to engage in business.”17

The enactment of the Decree since April 10, 1986 has not brought about the “demise” of the video industry. On the contrary, video establishments are seen to have proliferated in many places notwithstanding the 30% tax imposed.

In the last analysis. what petitioner basically questions is the necessity, wisdom and expediency of the DECREE. These considerations, however, are primarily and exclusively a matter of legislative concern.“Only congressional power or competence, not the wisdom of the action taken, may be the basis for declaring a statute invalid. This is as it ought to be. The principle of separation of powers has in the main wisely allocated the respective authority of each department and confined its jurisdiction to such a sphere. There would then be intrusion not allowable under the Constitution if on a matter left to the discretion of a coordinate branch, the judiciary would_______________

17 Solicitor General’s Comments, p. 102, Rollo.220

220


People vs. Salcedosubstitute its own. If there be adherence to the rule of law, as there ought to be, the last offender should be courts of justice, to which rightly litigants submit their controversy precisely to maintain unimpaired the supremacy of legal norms and prescriptions. The attack on the validity of the challenged provision likewise insofar as there may be

objections, even if valid and cogent, on its wisdom cannot be sustained.”18In fine, petitioner has not overcome the presumption of validity which attaches to a challenged statute. We find no clear violation of the Constitution which would justify us in pronouncing Presidential Decree No. 1987 as unconstitutional and void.

WHEREFORE, the instant Petition is hereby dismissed. No costs.

SO ORDERED. Teehankee, (C.J.), Yap, Fernan, Narvasa,

Gutierrez, Jr., Cruz, Paras, Feliciano, Gancayco, Padilla, Bidin, Sarmiento and Cortés, JJ., concur.

Petition dismissed——o0o——


VOL. 117, SEPTEMBER 30, 1982Taxicab Operators of Metro Manila, Inc. vs. Board of Transportation

No. L-59234. September 30, 1982.*TAXICAB OPERATORS OF METRO MANILA, INC.,

FELICISIMO CABIGAO and ACE TRANSPORTATION CORPORATION, petitioners, vs. THE BOARD OF TRANSPORTATION and THE DIRECTOR OF THE BUREAU OF LAND TRANSPORTATION, respondents.

Public Utility; Due process; The BOT need not first summon taxicab operators to a conference on public hearing before issuing circulars phasing-out more than 6-year old taxicabs.—It is clear from the provision aforequoted, however, that the leeway accorded the Board gives it a wide range of choice in gathering necessary information or data in the formulation of any policy, plan or program. It is not mandatory that it should first call a conference or require the submission of position papers or other documents from operators or persons who may be affected, this being only one of the options open to the Board, which is given wide discretionary authority. Petitioners cannot justifiably claim, therefore, that they were deprived of procedural due process. Neither can they state with certainty that public respondents had not availed of other sources of inquiry prior to issu-________________

* EN BANC

598

598


Taxicab Operators of Metro Manila, Inc. vs. Board of Transportationing the challenged Circulars. Operators of public conveyances are not the only primary sources of the data and information that may be desired by the BOT.

Same; Same; Same.—Dispensing with a public hearing

prior to the issuance of the Circulars is neither violative of procedural due process.

Same; Same; Constitutional Law; Fixing by BOT of the lifetime ceiling of six (6) years to taxicab is not unreasonable or arbitrary.—Petitioners further take the position that fixing the ceiling at six (6) years is arbitrary and oppressive because the roadwor-thiness of taxicabs depends upon their kind of maintenance and the use to which they are subjected, and, therefore, their actual physical condition should be taken into consideration at the time of registration. As public respondents contend, however, it is impractical to subject every taxicab to constant and recurring evaluation, not to speak of the fact that it can open the door to the adoption of multiple standards, possible collusion, and even graft and corruption. A reasonable standard must be adopted to apply to all vehicles affected uniformly, fairly, and justly. The span of six years supplies that reasonable standard. The product of experience shows that by that time taxis have fully depreciated, their cost recovered, and a fair return on investment obtained. They are also generally dilapidated and no longer fit for safe and comfortable service to the public specially considering that they are in continuous operation practically 24 hours everyday in three shifts of eight hours per shift. With that standard of reasonableness and absence of arbitrariness, the requirement of due process has been met.

Same; Same; Same; Fixing lifetime of taxicab to six (6) years in Metro Manila due to heavier traffic, safety and comfort of riding public is based on reasonable standards.—The Board's reason for enforcing the Circular initially in Metro Manila is that taxicabs in this city, compared to those of other places, are subjected to heavier traffic pressure and

more constant use. This is of common knowledge. Considering that traffic conditions are not the same in every city, a substantial distinction exists so that infringement of the equal protection clause can hardly be successfully claimed. As enunciated in the preambular clauses of the challenged BOT Circular, the overriding consideration is the safety and comfort of the riding public from the dangers possed by old and dilapidated taxis. The State, in the exercise of its police power, can prescribe regulations to promote

599


the health, morals, peace, good order, safety and general welfare of the people. It can prohibit all things hurtful to comfort, safety and welfare of society. It may also regulate property rights.

Same; Same; Same; Non-applicability of phase-out rule on taxis to other vehicles not violative of equal protection clause.—In so far as the non-application of the assailed Circulars to other transportation services is concerned, it need only be recalled that the equal protection clause does not imply that the same treatment be accorded all and sundry. It applies to things or persons identically or similarly situated, It permits of classification of the object of subject of the law provided classification is reasonable or based on substantial distinction, which make for real differences, and that it must apply equally to each member of the class. What is required under the equal protection clause is the uniform operation by legal means so that all persons under identical or similar circumstance would be

accorded the same treatment both in privilege conferred and the liabilities imposed. The challenged Circulars satisfy the foregoing criteria.PETITION for certiorari, prohibition and mandamus with preliminary injunction to review the order of the Board of Transportation.

The facts are stated in the opinion of the Court.MELENCIO-HERRERA, J.:

This Petition for "Certiorari, Prohibition and Mandamus with Preliminary Injunction and Temporary Restraining Order" filed by the Taxicab Operators of Metro Manila, Inc., Felicisimo Cabigao and Ace Transportation, seeks to declare the nullity of Memorandum Circular No. 77-42, dated October 10, 1977, of the Board of Transportation, and Memorandum Circular No. 52, dated August 15, 1980, of the Bureau of Land Transportation.

Petitioner Taxicab Operators of Metro Manila, Inc. (TOMMI) is a domestic corporation composed of taxicab operators, who are grantees of Certificates of Public Convenience to operate taxicabs within the City of Manila and to any other place in Luzon accessible to vehicular traffic. Petitioners Ace Transportation Corporation and Felicisimo Cabigao are two of

600

600


Taxicab Operators of Metro Manila, Inc. vs. Board of Transportationthe members of TOMMI, each being an operator and grantee of such certificate of public convenience.

On October 10, 1977, respondent Board of

Transportation (BOT) issued Memorandum Circular No. 77-42 which reads:

SUBJECT: Phasing out and Replacement of Old and Dilapidated Taxis

"WHEREAS, it is the policy of the government to insure that only safe and comfortable units are used as public conveyances;

WHEREAS, the riding public, particularly in Metro-Manila, has, time and again, complained against, and condemned, the continued operation of old and dilapidated taxis;

WHEREAS, in order that the commuting public may be assured of comfort, convenience, and safety, a program of phasing out of old and dilapidated taxis should be adopted;

WHEREAS, after studies and inquiries made by the Board of Transportation, the latter believes that in six years of operation, a taxi operator has not only covered the cost of his taxis, but has made reasonable profit for his investments;

NOW, THEREFORE, pursuant to this policy, the Board hereby declares that no car beyond six years shall be operated as taxi, and in implementation of the same hereby promulgates the following rules and regulations:

9.1.As of December 31, 1977, all taxis of Model 1971 and earlier are ordered withdrawn from public service and thereafter may no longer be registered and operated as

taxis. In the registration of cards for 1978, only taxis of Model 1972 and later shall be accepted for

registration and allowed for operation;10. 2.As of December 31, 1978, all taxis of Model 1972

are ordered withdrawn from public service and thereafter may no longer be registered and operated as taxis. In the registration of cars for 1979, only taxis of

Model 1973 and later shall be accepted for registration and allowed for operation; and every year thereafter, there shall be a six-year lifetime of taxi, to

wit:1980—Model 19741981—Model 1975, etc.All taxis of earlier models than those provided above are

hereby ordered withdrawn from public service as of the last day of registration of each particular year and their respective plates shall be sur-

601


rendered directly to the Board of Transportation for subsequent turnover to the Land Transportation Commission.

For an orderly implementation of this Memorandum Circular, the rules herein shall immediately be effective in Metro-Manila. Its implementation outside Metro-Manila shall be carried out only after the project has been implemented in Metro-Manila and only after the date has been determined by the Board."1Pursuant to the above BOT circular, respondent Director of the Bureau of Land Transportation (BLT) issued Implementing Circular No. 52, dated August 15, 1980, instructing the Regional Director, the MV Registrars and other personnel of BLT, all within the National Capitol Region, to implement said Circular, and formulating a schedule of phase-out of vehicles to be allowed and accepted for registration as public conveyances. To quote said Circular:"Pursuant to BOT Memo-Circular No. 77-42, taxi units with

year models over six (6) years old are now banned from operating as public utilities in Metro Manila. As such the units involved should be considered as automatically dropped as public utilities and, therefore, do not require any further dropping order from the BOT.

"Henceforth, taxi units within the National Capitol Region having year models over 6 years old shall be refused registration. The following schedule of phase-out is herewith prescribed for the guidance of all concerned:

"Year Model Automatic Phase-Out Year

1980

1974 1981

1975 1982

1976 1983

1977

etc. etc.Strict compliance here is desired."2

In accordance therewith, cabs of model 1971 were phase-out in registration year 1978; those of model 1972, in 1979; those________________

1 Annex "A", pp. 26-27, Rollo.2 Annex "B", p. 28, ibid.

602

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Taxicab Operators of Metro Manila, Inc. vs. Board of Transportationof model 1973, in 1980; and those of model 1974, in 1981.

On January 27, 1981, petitioners filed a Petition with the

BOT, docketed as Case No. 80-7553, seeking to nullify MC No. 77-42 or to stop its implementation; to allow the registration and operation in 1981 and subsequent years of taxicabs of model 1974, as well as those of earlier models which were phased-out, provided that, at the time of registration, they are roadworthy and fit for operation.

On February 16, 1981, petitioners filed before the BOT a "Manifestation and Urgent Motion", praying for an early hearing of their petition. The case was heard on February 20, 1981. Petitioners presented testimonial and documentary evidence, offered the same, and manifested that they would submit additional documentary proofs. Said proofs were submitted on March 27, 1981 attached to petitioners' pleading entitled, "Manifestation, Presentation of Additional Evidence and Submission of the Case for Resolution."3

On November 28, 1981, petitioners filed before the same Board a "Manifestation and Urgent Motion to Resolve or Decide Main Petition" praying that the case be resolved or decided not later than December 10, 1981 to enable them, in case of denial, to avail of whatever remedy they may have under the law for the protection of their interests before their 1975 model cabs are phased-out on January 1, 1982.

Petitioners, through its President, allegedly made personal follow-ups of the case, but was later informed that the records of the case could not be located.

On December 29, 1981, the present Petition was instituted wherein the following queries were posed for consideration by this Court:

4."A.Did BOT and BLT promulgate the questioned memorandum circulars in accord with the manner required by Presidential Decree No. 101, thereby

safeguarding the petitioners' constitutional right to procedural due process?

5.B.Granting, arguendo, that respondents did comply with the

________________

3 Annex "D", pp. 38-53, ibid.603


procedural requirements imposed by Presidential Decree No. 101,would the implementation and enforcement of the assailed memorandum circulars violate the petitioners' constitutional rights to.

8.(1)Equal protection of the law;9.(2)Substantive due process; and

10. (3)Protection against arbitrary and unreasonable classification and standard?

On Procedural and Substantive Due Process:

Presidential Decree No. 101 grants to the Board of Transportation the power"4. To fix just and reasonable standards, classification, regulations, practices, measurements, or service to be furnished, imposed, observed, and followed by operators of public utility motor vehicles."Section 2 of said Decree provides procedural guidelines for said agency to follow in the exercise of its powers:"Sec. 2. Exercise of powers.—In the exercise of the powers granted in the preceding section, the Board shall proceed promptly along the method of legislative inquiry.

Apart from its own investigation and studies, the Board, in its discretion, may require the cooperation and assistance of the Bureau of Transportation, the Philippine Constabulary, particularly the Highway Patrol Group, the

support agencies within the Department of Public Works, Transportation and Communications, or any other government office or agency that may be able to furnish useful information or data in the formulation of the Board of any policy, plan or program in the implementation of this Decree.

The Board may also call conferences, require the submission of position papers or other documents, information, or data by operators or other persons that may be affected by the implementation of this Decree, or employ any other suitable means of inquiry."In support of their submission that they were denied procedural due process, petitioners contend that they were not called upon to submit their position papers, nor were they ever

604

604


Taxicab Operators of Metro Manila, Inc. vs. Board of Transportationsummoned to attend any conference prior to the issuance of the questioned BOT Circular.

It is clear from the provision aforequoted, however, that the leeway accorded the Board gives it a wide range of choice in gathering necessary information or data in the formulation of any policy, plan or program. It is not mandatory that it should first call a conference or require the submission of position papers or other documents from operators or persons who may be affected, this being only one of the options open to the Board, which is given wide discretionary authority. Petitioners cannot justifiably claim, therefore, that they were deprived of procedural due process. Neither can they state with certainty that public respondents

had not availed of other sources of inquiry prior to issuing the challenged Circulars. Operators of public conveyances are not the only primary sources of the data and information that may be desired by the BOT.

Dispensing with a public hearing prior to the issuance of the Circulars is neither violative of procedural due process. As held in Central Bank vs. Hon. Cloribel and Banco Filipino, 44 SCRA 307 (1972):"Previous notice and hearing as elements of due process, are constitutionally required for the protection of life or vested property rights, as well as of liberty, when its limitation or loss takes place in consequence of a judicial or quasi-judicial proceeding, generally dependent upon a past act or event which has to be established or ascertained. It is not'essential to the validity of general rules or regulations promulgated to govern future conduct of a class or persons or enterprises, unless the law provides otherwise." (Emphasis supplied)Petitioners further take the position that fixing the ceiling at six (6) years is arbitrary and oppressive because the roadworthiness of taxicabs depends upon their kind of maintenance and the use to which they are subjected, and, therefore, their actual physical condition should be taken into consideration at the time of registration. As public respondents contend, however, it is impractical to subject

605


every taxicab to constant and recurring evaluation, not to speak of the fact that it can open the door to the adoption of multiple standards, possible collusion, and even graft and corruption. A reasonable standard must be adopted to apply to all vehicles affected uniformly, fairly, and justly. The

span of six years supplies that reasonable standard. The product of experience shows that by that time taxis have fully depreciated, their cost recovered, and a fair return on investment obtained. They are also generally dilapidated and no longer fit for safe and comfortable service to the public specially considering that they are in continuous operation practically 24 hours everyday in three shifts of eight hours per shift. With that standard of reasonableness and absence of arbitrariness, the requirement of due process has been met.On Equal Protection of the Law:

Petitioners alleged that the Circular in question violates their right to equal protection of the law because the same is being enforced in Metro Manila only and is directed solely towards the taxi industry. At the outset it should be pointed out that implementation outside Metro Manila is also envisioned in Memorandum Circular No. 77-42. To repeat the pertinent portion:"For an orderly implementation of this Memorandum Circular, the rules herein shall immediately be effective in Metro Manila. Its implementation outside Metro Manila shall be carried out only after the project has been implemented in Metro Manila and only after the date has been determined by the Board."4In fact, it is the understanding of the Court that implementation of the Circulars in Cebu City is already being effected, with the BOT in the process of conducting studies regarding the operation of taxicabs in other cities.

The Board's reason for enforcing the Circular initially in Metro Manila is that taxicabs in this city, compared to those of other places, are subjected to heavier traffic pressure and more constant use. This is of common knowledge.

Considering________________

4 p. 19, ibid.606

606


Taxicab Operators of Metro Manila, Inc. vs. Board of Transportationthat traffic conditions are not the same in every city, a substantial distinction exists so that infringement of the equal protection clause can hardly be successfully claimed.

As enunciated in the preambular clauses of the challenged BOT Circular, the overriding consideration is the safety and comfort of the riding public from the dangers posed by old and dilapidated taxis. The State, in the exercise of its police power, can prescribe regulations to promote the health, morals, peace, good order, safety and general welfare of the people. It can prohibit all things hurtful to comfort, safety and welfare of society.5 It may also regulate property rights.6 In the language of Chief Justice Enrique M. Fernando "the necessities imposed by public welfare may justify the exercise of governmental authority to regulate even if thereby certain groups may plausibly assert that their interests are disregarded".7

In so far as the non-application of the assailed Circulars to other transportation services is concerned, it need only be recalled that the equal protection clause does not imply that the same treatment be accorded all and sundry. It applies to things or persons identically or similarly situated. It permits of classification of the object or subject of the law provided classification is reasonable or based on substantial distinction, which make for real differences, and that it must apply equally to each member of the class.8 What is

required under the equal protection clause is the uniform operation by legal means so that all persons under identical or similar circumstance would be accorded the same treatment both in privilege conferred________________

5 Edu vs. Ericta, 35 SCRA 481 (1970).6 Samson vs. Mayor of Bacolod City, 60 SCRA 267

(1974).7 The Constitution of the Philippines, Second Edition, p.

548.8 People vs. Vera, 65 Phil. 56; People vs. Cayat, 68 Phil.

12; Central Bank vs. Cloribel, 44 SCRA 307 (1972); Anucension vs. National Labor Union, 80 SCRA 350 (1977) citing Victoriano vs. Elizalde Rope Workers' Union, 59 SCRA 54 (1974) & Basa vs. Federacion Obrera de la Industria Tabaquera y Otros Trabajadores de Filipinas, 61 SCRA 93 (1974).

607


and the liabilities imposed.9 The challenged Circulars satisfy the foregoing criteria.

Evident then is the conclusion that the questioned Circulars do not suffer from any constitutional infirmity. To declare a law unconstitutional, the infringement of constitutional right must be clear, categorical and undeniable.10

WHEREFORE, the Writs prayed for are denied and this Petition is hereby dismissed, No costs.

SO ORDERED. Fernando, C.J., Barredo, Makasiar, Concepcion,

Jr., Guerrero, Abad Santos, De Castro, Plana, Escolin,

Vasquez, Relova and Gutierrez, Jr., JJ., concur. Teehankee and Aquino, JJ., in the result.

Writs denied and petition dismissed.Notes.—The police power is a dynamic agency, suitably

vague and far from precisely defined, rooted in the conception that men in organizing the State and imposing upon its government limitations to safeguards constitutional rights did not intend thereby to enable an individual citizens or a group of citizens to abstract unreasonably the enactment of such salutory measures calculated to insure communal peace, safety, good order, and welfare. (Agustin vs. Edu, 88 SCRA 195.)

Municipal corporations allowed with discretion in determining the rates of improbable license fees including police power measures. (Procter & Gamble Philippine Manufacturing Corporation vs. Municipality of Jagna, Bokol, 94 SCRA 899.)

——o0o——

________________

9 Gumabon vs. Director of Prisons, 37 SCRA 420 (1971).10 Morfe vs. Mutuc, 22 SCRA 424 (1868).

608© Copyright 2014 Central Book Supply, Inc. All rights reserved.

VOL. 180, DECEMBER 21, 1989Department of Education, Culture and Sports vs. San Diego

G.R. No. 89572. December 21, 1989.*DEPARTMENT OF EDUCATION, CULTURE AND SPORTS (DECS) and DIRECTOR OF CENTER FOR EDUCATIONAL MEASUREMENT, petitioners, vs. ROBERTO REY C. SAN DIEGO and JUDGE TERESITA DIZON-CAPULONG, in her capacity as Presiding Judge of the Regional Trial Court of Valenzuela, Metro Manila, Branch 172, respondents.

Constitutional Law; Police Power; Defined; Proper Exercise of; Case at bar.—We see no reason why the rationale in the Tablarin case cannot apply to the case at bar. The issue raised in both cases is the academic preparation of the applicant. This may be gauged at least initially by the admission test and, indeed with more reliability, by the three-flunk rule. The latter cannot be regarded any less valid than the former in the regulation of the medical profession. There is no need to redefine here the police power of the State. Suffice it to repeat that the power is validly exercised if (a) the interests of the public generally, as distinguished from those of a particular class, require the interference of the State, and (b) the means employed are reasonably necessary to the attainment of the object sought to be

accomplished and not unduly oppressive upon individuals.Same; Same; Same; It is the right and responsibility of

the State to insure that the medical profession is not infiltrated by incompetents to whom patients may unwarily entrust their lives and health; Three flunk rule, intention of—In other words, the proper exercise of the police power requires the concurrence of a lawful subject and a lawful method. The subject of the challenged regulation is certainly within the ambit of the police power. It is the right and indeed the responsibility of the State to insure that the medical profession is not infiltrated by incompetents to whom patients may unwarily entrust their lives and health. The method employed by the challenged regulation is not irrelevant to the purpose of the law nor is it arbitrary or oppressive. The three-flunk rule is intended to insulate the medical schools and ultimately the________________

* EN BANC.

534

534


Department of Education, Culture and Sports us. San Diegomedical profession from the intrusion of those not qualified to be doctors.

Same; Same; Same; Same; Same; While every person is entitled to aspire to be a doctor, he does not have a constitutional right to be a doctor.—While every person is entitled to aspire to be a doctor, he does not have a constitutional right to be a doctor. This is true of any other calling in which the public interest is involved; and the

closer the link, the longer the bridge to one’s ambition. The State has the responsibility to harness its human resources and to see to it that they are not dissipated or, no less worse, not used at all. These resources must be applied in a manner that will best promote the common good while also giving the individual a sense of satisfaction.

Same; Same; Same; Same; Same; The contention that the challenged rule violates the equal protection clause is not well-taken; Reasons.—The contention that the challenged rule violates the equal protection clause is not well-taken. A law does not have to operate with equal force on all persons or things to be conformable to Article III, Section 1 of the Constitution. There can be no question that a substantial distinction exists between medical students and other students who are not subjected to the NMAT and the three-flunk rule. The medical profession directly affects the very lives of the people, unlike other careers which, for this reason, do not require more vigilant regulation. The accountant, for example, while belonging to an equally respectable profession, does not hold the same delicate responsibility as that of the physician and so need not be similarly treated. There would be unequal protection if some applicants who have passed the tests are admitted and others who have also qualified are denied entrance. In other words, what the equal protection requires is equality among equals.PETITION to review the decision of the Regional Trial Court of Valenzuela, M.M., Br. 172. Dizon-Capulong, J.

The facts are stated in the opinion of the Court. Ramon M. Guevara for private respondent.

CRUZ, J.:

The issue before us is mediocrity. The question is whether a

person who has thrice failed the National Medical Admission Test (NMAT) is entitled to take it again.

535


The petitioner contends he may not, under its rule that—h) A student shall be allowed only three (3) chances to take the NMAT. After three (3) successive failures, a student shall not be allowed to take the NMAT for the fourth time.The private respondent insists he can, on constitutional grounds.

But first the facts.The private respondent is a graduate of the University of

the East with a degree of Bachelor of Science in Zoology. The petitioner claims that he took the NMAT three times and flunked it as many times.1 When he applied to take it again, the petitioner rejected his application on the basis of the aforesaid rule. He then went to the Regional Trial Court of Valenzuela, Metro Manila, to compel his admission to the test.

In his original petition for mandamus, he first invoked his constitutional rights to academic freedom and quality education. By agreement of the parties, the private respondent was allowed to take the NMAT scheduled on April 16, 1989, subject to the outcome of his petition.2 In an amended petition filed with leave of court, he squarely challenged the constitutionality of MECS Order No. 12, Series of 1972, containing the above-cited rule. The additional grounds raised were due process and equal protection.

After hearing, the respondent judge rendered a decision on July 4, 1989, declaring the challenged order invalid and

granting the petition. Judge Teresita Dizon-Capulong held that the petitioner had been deprived of his right to pursue a medical education through an arbitrary exercise of the police power.3

We cannot sustain the respondent judge. Her decision must be reversed.

In Tablarin v. Gutierrez.4 this Court upheld the constitution-_______________

1 A check with the Department of Education showed that the private respondent had actually taken and flunked four tests already and was applying to take a fifth examination.

2 He also failed this fifth test.3 Rollo, pp. 26-34.4 152 SCRA 730.

536

536


Department of Education, Culture and Sports vs. San Diegoality of the NMAT as a measure intended to limit the admission to medical schools only to those who have initially proved their competence and preparation for a medical education. Justice Florentino P. Feliciano declared for a unanimous Court:Perhaps the only issue that needs some consideration is whether there is some reasonable relation between the prescribing of passing the NMAT as a condition for admission to medical school on the one hand, and the securing of the health and safety of the general community, on the other hand. This question is perhaps most usefully approached by recalling that the regulation ofthepratice of medicine in all its branches has long been recognized as a

reasonable method of protecting the health and safety of the public. That the power to regulate and control the practice of medicine includes the power to regulate admission to the ranks of those authorized to practice medicine, is also well recognized. Thus, legislation and administrative regulations requiring those who wish to practice medicine first to take and pass medical board examinations have long ago been recognized as valid exercises of governmental power. Similarly, the establishment of minimum medical educational requirements—i.e, the completion of prescribed courses in a recognized medical school—for admission to the medical profession, has also been sustained as a legitimate exercise of the regulatory authority of the state. What we have before us in the instant case is closely related: the regulation of access to medical schools. MECS Order No. 52, s. 1985, as noted earlier, articulates the rationale of regulation of this type: the improvement of the professional and technical quality of the graduates of medical schools, by upgrading the quality of those admitted to the student body of the medical schools. That upgrading is sought by selectivity in the process of admission, selectivity consisting, among other things, of limiting admission to those who exhibit in the required degree the aptitude for medical studies and eventually for medical practice. The need to maintain, and the difficulties of maintaining, high standards in our professional schools in general, and medical schools in particular, in the current state of our social and economic development, are widely known.

We believe that the government is entitled to prescribe an admission test like the NMAT as a means of achieving its stated objective of “upgrading the selection of applicants into [our] medical schools” and of “improving] the quality of medical education in the country.” Given the widespread

use today of such admission tests in, for instance, medical schools in the United States of America (the Medical College Admission Test [MCAT]) and quite probably, in other countries with far more developed educational resources than our own, and taking into

537


account the failure or inability of the petitioners to even attempt to prove otherwise, we are entitled to hold that the NMAT is reasonably related to the securing of the ultimate end of legislation and regulation in this area. That end, it is useful to recall, is the protection of the public from the potentially deadly effects of incompetence and ignorance in those who would undertake to treat our bodies and minds for disease or trauma.However, the respondent judge agreed with the petitioner that the said case was not applicable. Her reason was that it upheld only the requirement for the admission test and said nothing about the so-called “three-flunk rule.”

We see no reason why the rationale in the Tablarin case cannot apply to the case at bar. The issue raised in both cases is the academic preparation of the applicant. This may be gauged at least initially by the admission test and, indeed with more reliability, by the three-flunk rule. The latter cannot be regarded any less valid than the former in the regulation of the medical profession.

There is no need to redefine here the police power of the State. Suffice it to repeat that the power is validly exercised if (a) the interests of the public generally, as distinguished from those of a particular class, require the interference of the State, and (b) the means employed are reasonably

necessary to the attainment of the object sought to be accomplished and not unduly oppressive upon individuals.5

In other words, the proper exercise of the police power requires the concurrence of a lawful subject and a lawful method.

The subject of the challenged regulation is certainly within the ambit of the police power. It is the right and indeed the responsibility of the State to insure that the medical profession is not infiltrated by incompetents to whom patients may unwarily entrust their lives and health.

The method employed by the challenged regulation is not irrelevant to the purpose of the law nor is it arbitrary or oppressive. The three-flunk rule is intended to insulate the medical schools and ultimately the medical profession from the intrusion of those not qualified to be doctors._______________

5 US vs. Toribio, 15 Phil. 85; Fabie v. City of Manila, 21 Phil. 486; Ynot v. Intermediate Appellate Court, 148 SCRA 659.

538

538


Department of Education, Culture and Sports vs. San DiegoWhile every person is entitled to aspire to be a doctor, he does not have a constitutional right to be a doctor. This is true of any other calling in which the public interest is involved; and the closer the link, the longer the bridge to one’s ambition. The State has the responsibility to harness its human resources and to see to it that they are not dissipated or, no less worse, not used at all. These resources must be applied in a manner that will best promote the common good while also giving the individual a sense of

satisfaction.A person cannot insist on being a physician if he will be

a menace to his patients. If one who wants to be a lawyer may prove better as a plumber, he should be so advised and adviced. Of course, he may not be forced to be a plumber, but on the other hand he may not force his entry into the bar. By the same token, a student who has demonstrated promise as a pianist cannot be shunted aside to take a course in nursing, however appropriate this career may be for others.

The right to quality education invoked by the private respondent is not absolute. The Constitution also provides that “every citizen has the right to choose a profession or course of study, subject to fair, reasonable and equitable admission and academic requirements.”6

The private respondent must yield to the challenged rule and give way to those better prepared. Where even those who have qualified may still not be accommodated in our already crowded medical schools, there is all the more reason to bar those who, like him, have been tested and found wanting.

The contention that the challenged rule violates the equal protection clause is not well-taken. A law does not have to operate with equal force on all persons or things to be conformable to Article III, Section 1 of the Constitution.

There can be no question that a substantial distinction exists between medical students and other students who are not subjected to the NMAT and the three-flunk rule. The medical profession directly affects the very lives of the people, unlike other careers which, for this reason, do not require more vigilant regulation. The accountant, for example, while belonging to an equally respectable profession, does not hold the same delicate________________

6 Article XIV, Section 5(3).539


responsibility as that of the physician and so need not be similarly treated.

There would be unequal protection if some applicants who have passed the tests are admitted and others who have also qualified are denied entrance. In other words, what the equal protection requires is equality among equals.

The Court feels that it is not enough to simply invoke the right to quality education as a guarantee of the Constitution: one must show that he is entitled to it because of his preparation and promise. The private respondent has failed the NMAT five times.7 While his persistence is noteworthy, to say the least, it is certainly misplaced, like a hopeless love.

No depreciation is intended or made against the private respondent. It is stressed that a person who does not qualify in the NMAT is not an absolute incompetent unfit for any work or occupation. The only inference is that he is a probably better, not for the medical profession, but for another calling that has not excited his interest.

In the former, he may be a bungler or at least lackluster; in the latter, he is more likely to succeed and may even be outstanding. It is for the appropriate calling that he is entitled to quality education for the full harnessing of his potentials and the sharpening of his latent talents toward what may even be a brilliant future.

We cannot have a society of square pegs in round holes, of dentists who should never have left the farm and engineers who should have studied banking and teachers

who could be better as merchants.It is time indeed that the State took decisive steps to

regulate and enrich our system of education by directing the student to the course for which he is best suited as determined by initial tests and evaluations. Otherwise, we may be “swamped with mediocrity,” in the words of Justice Holmes, not because we are lacking in intelligence but because we are a nation of misfits.

WHEREFORE, the petition is GRANTED. The decision of the respondent court dated January 13, 1989, is REVERSED, with costs against the private respondent. It is so ordered.________________

7 Footnote Nos. 1 & 2.540

540


Katigbak vs. Solicitor General Fernan (C.J.), Narvasa, Melencio-Herrera,

Gutierrez, Jr., Paras, Feliciano, Gancayco, Padilla, Bidin, Sarmiento, Cortés, Griño-Aquino, Medialdea and Regalado, JJ., concur.

Petition granted. Decision reversed.Notes.—No disciplinary action may be imposed on

students without abiding by the requirements of due process. (Guzman vs. National University, 142 SCRA 699.)

A school cannot refuse to re-enroll a student it believes guilty of acts inimical to the school, without first conducting an investigation. (Guzman vs. National University, 142 SCRA 699.)

——o0o——


[No. 5060. January 26, 1910.]THE UNITED STATES, plaintiff and appellee, vs. Luis TORIBIO, defendant and appellant.

11. 1.STATUTORY CONSTRUCTION; SLAUGHTER OF LARGE CATTLE.—Sections 30 and 33 of Act

No. 1147 construed.6.2.ID.; ID.—Where the language of a statute is fairly

susceptible of two or more constructions, that construction should be adopted which will most tend to give effect to the manifest intent of the lawmaker

and promote the object for which the statute was enacted, and a construction should be rejected which would tend to render abortive other provisions of the

statute and to defeat the object which the legislator sought to attain by its enactment.

11. 3.ID.; ID.; POLICE POWER OF THE STATE.—The provisions of Act No.

86

86 PHILIPPINE REPORTS ANNOTATEDUnited States vs. Toribio.

2.1147 prohibiting and penalizing the slaughter of carabaos

for human consumption which are fit for "agricultural work and draft purposes," held to be a reasonable and justifiable exercise of the sovereign police power of the State, under the conditions existing in these Islands.

2.4.ID.; ID.; ID.; APPROPRIATION OF PRIVATE PROPERTY TO PUBLIC USE.—These provisions

held not to constitute an appropriation of private property interests to a "public use" so as to bring them within the principles of the exercise by the State of the

right of eminent domain and to entitle the owners to compensation, being no more than a just restraint of

an injurious private use of property.2.5.ID.; ID.; CIRCUMSTANCES JUSTIFYING USE OF

THE POLICE POWER.—"To justify the State" in the exercise of its sovereign police power "it must appear,

first, that the interests of the public generally, as distinguished from those of a particular class, require

such interference; and, second, that the means are reasonably necessary for the accomplishment of the

purpose, and not unduly oppressive upon individuals." (Lawton vs. Steele, 152 U. S., 133, 136.)

APPEAL from a judgment of the Court of First Instance of Bohol. Wislizenus, J.

The f acts are stated in the opinion of the court.Rodriguez & Del Rosario, for appellant.Attorney-General Villamor, for appellee.

CARSON, J.:

The evidence of record fully sustains the findings of the trial court that the appellant slaughtered or caused to be slaughtered for human consumption, the carabao described in the information, without a permit from the municipal

treasurer of the municipality wherein it was slaughtered, in violation of the provisions of sections 30 and 33 of Act No. 1147, an Act regulating the registration, branding, and slaughter 01 large cattle.

It appears that in the town of Carmen, in the Province of Bohol, wherein the animal was slaughtered there is no municipal slaughterhouse, and counsel for appellant contends that under such circumstances the provisions of Act No. 1147 do not prohibit nor penalize the slaughter of large cattle without a permit of the municipal treasurer.

87

VOL. 15, JANUARY 26, 1910United States vs. Toribio.

Sections 30, 31, 32, and 33 of the Act are as follows:"SEC. 30. No large cattle shall be slaughtered or killed for food at the municipal slaughterhouse except upon permit secured from the municipal treasurer. Before issuing the permit for the slaughter of large cattle for human consumption, the municipal treasurer shall require for branded cattle the production of the original certificate of ownership and certificates of transfer showing title in the person applying for the permit, and for unbranded cattle such evidence as may satisfy said treasurer as to the ownership of the animals for which permit to slaughter has been requested.

"SEC. 31. No permit to slaughter carabaos shall be granted by the municipal treasurer unless such animals are unfit for agricultural work or for draft purposes, and in no event shall a permit be given to slaughter for food any animal of any kind which is not fit for human consumption.

"SEC. 32. The municipal treasurer shall keep a record of all permits for slaughter issued by him, and such record shall

show the name and residence of the owner, and the class, sex, age, brands, knots of radiated hair commonly known as remolinos or cowlicks, and other marks of identification of the animal for the slaughter of which permit is issued and the date on which such permit is issued. Names of owners shall be alphabetically arranged in the record, together with date of permit.

"A copy of the record of permits granted for slaughter shall be forwarded monthly to the provincial treasurer, who shall file and properly index the same under the name of the owner, together with date of permit.

"SEC. 33. Any person slaughtering or causing to be slaughtered for human consumption or killing for food at the municipal slaughterhouse any large cattle except upon permit duly secured from the municipal treasurer, shall be punished by a fine of not less than ten nor more than five hundred pesos, Philippine currency, or by imprisonment for not less than one month nor more than six months, or by both such fine and imprisonment, in the discretion of the court."

88


It is contended that the proper construction of the language of these provisions limits the prohibition contained in section 30 and the penalty imposed in section 33 to cases (1) of slaughter of large cattle f or human consumption in a municipal slaughterhouse without a permit duly secured from the municipal treasurer, and (2) cases of killing of large cattle for food in a municipal slaughterhouse without a permit duly secured from the municipal treasurer; and it is urged that the municipality of Carmen not being provided

with a municipal slaughterhouse, neither the prohibition nor the penalty is applicable to cases of slaughter of large cattle without a permit in that municipality.

We are of opinion, however, that the prohibition contained in section 30 refers (1) to the slaughter of large cattle for human consumption, anywhere, without a permit duly secured from the municipal treasurer, and (2) expressly and specifically to the killing for food of large cattle at a municipal slaughterhouse without such permit; and that the penalty provided in section 33 applies generally to the slaughter of large cattle for human consumption, anywhere, without a permit duly secured from the municipal treasurer, and specifically to the killing for food of large cattle at a municipal slaughterhouse without such permit.

It may be admitted at once, that the pertinent language of these sections taken by itself and examined apart from the context fairly admits of two constructions: one whereby the phrase "at the municipal slaughterhouse" may be taken as limiting and restricting both the word "slaughtered" and the words "killed for food" in section 30, and the words "slaughtering or causing to be slaughtered for human consumption" and the words "killing for food" in section 33; and the other whereby the phrase "at the municipal slaughterhouse" may be taken as limiting and restricting merely the words "killed for food" and "killing for food" as used in those sections. But upon a reading of the whole Act, and keeping in mind the manifest and expressed pur-

89


pose and object of its enactment, it is very clear that the latter construction is that which should be adopted.

The Act primarily seeks to protect the "large cattle" of the Philippine Islands against theft and to make easy the recovery and return of such cattle to their proper owners, when lost, strayed, or stolen. To this end it provides an elaborate and compulsory system for the separate branding and registry of ownership of all such cattle throughout the Islands, whereby owners are enabled readily and easily to establish their title; it prohibits and invalidates all transfers of large cattle unaccompanied by certificates of transfer issued by the proper officer in the municipality where the contract of sale is made; and it provides also for the disposition of estrays and animals recovered from the possession of thieves or persons unlawf ully in possession, so as to protect the rights of the true owners. All this, manifestly, in order to make it difficult for any one but the rightful owner of such cattle to retain them in his possession or to dispose of them to others. But the usefulness of this elaborate and compulsory system of identification, resting as it does on the official registry of the brands and marks on each separate animal throughout the Islands, would be largely impaired, if not totally destroyed, if such animals were permitted to be slaughtered for human consumption without requiring proof of ownership and the production of certificates of registry by the person slaughtering or causing them to be slaughtered, and this especially if the animals were slaughtered privately or in a clandestine manner, outside of a municipal slaughterhouse. Hence, as it would appear, sections 30 and 33 prohibit and penalize the slaughter f or human consumption or killing f or f ood at a municipal slaughterhouse of such animals without a permit issued by the municipal treasurer, and section 32 provides for the keeping of detailed records of all such permits in the office of the municipal and also of the provincial treasurer.

If, however, the construction be placed on these sections which is contended for by the appellant, it will readily be

90


seen that all these carefully worked out provisions for the registry and record of the brands and marks of identification of all large cattle in the Islands would prove in large part abortive, since thieves and persons unlawfully in possession of such cattle could, and naturally would, evade the provisions of the law by slaughtering them outside of municipal slaughterhouses, and thus enjoy the fruits of their wrongdoing without exposing themselves to the danger of detection incident to the bringing of the animals to the public slaughterhouse, where the brands and other identification marks might be scrutinized and proof of ownership required.

Where the language of a statute is fairly susceptible of two or more constructions, that construction should be adopted which will most tend to give effect to the manifest intent of the lawmaker and promote the object for which the statute was enacted, and a construction should be rejected which would tend to render abortive other provisions of the statute and to defeat the object which the legislator sought to. attain by its enactment. We are of opinion, therefore, that sections 30 and 33 of the Act prohibit and penalize the slaughtering or causing to be slaughtered for human consumption of large cattle at any place without the permit provided for in section 30.

It is not essential that an explanation be found for the express prohibition in these sections of the "killing for food at a municipal slaughterhouse" of such animals, despite the fact that this prohibition is clearly included in the general

prohibition of the slaughter of such animals for human consumption anywhere; but it is not improbable that the requirement for the issue of a permit in such cases was expressly and specifically mentioned out of superabundance of precaution, and to avoid all possibility of misunderstanding in the event that some of the municipalities should be disposed to modify or vary the general provisions of the law by the passage of local ordinances or regulations for the control of municipal slaughterhouses.

Similar reasoning applied to the specific provisions of91


section 31 of the Act leads to the same conclusion. One of the secondary purposes of the law, as set out in that section, is to prevent the slaughter for food of carabaos fit for agricultural and draft purposes, and of all animals unfit for human consumption. A construction which would limit the prohibitions and penalties prescribed in the statute to the killing of such animals in municipal slaughterhouses, leaving unprohibited and unpenalized their slaughter outside of such establishments, so manifestly tends to defeat the purpose and.object of the legislator, that unless imperatively demanded by the language of the statute it should be rejected; and, as we have already indicated, the language of the statute is clearly susceptible of the construction which we have placed upon it, which tends to make effective the provisions of this as well as all the other sections of the Act.

It appears that the defendant did in fact apply for a permit to slaughter his carabao, and that it was denied him on the ground that the animal was not unfit "for agricultural

work or for draft purposes." Counsel for appellant contends that the statute, in so far as it undertakes to penalize the slaughter of carabaos for human consumption as food, without first obtaining a permit which can not be procured in the event that the animal is not unfit "for agricultural work or for draft purposes," is unconstitutional and in violation of the terms of section 5 of the Philippine Bill (Act of Congress, July 1, 1902), which provides that "no law shall be enacted which shall deprive any person of life, liberty, or property without due process of law."

It is not quite clear f rom the argument of counsel whether his contention is that this provision of the statute constitutes a taking of property for public use in the exercise of the right of eminent domain without providing for the compensation of the owners, or that it is an undue and unauthorized exercise of the police power of the State. But whatever may be the basis of his contention, we are of opinion, appropriating, with necessary modifications understood, the language of that great jurist, Chief Justice Shaw

92


(in the case of Com. vs. Tewksbury, 11 Met., 55, where the question involved was the constitutionality of a statute prohibiting and penalizing the taking or carrying away by any person, including the owner, of any stones, gravel, or sand, from any of the beaches in the town of Chelsea), that the law in question "is not a taking of the property for public use, within the meaning of the constitution, but is a just and legitimate exercise of the power of the legislature to regulate and restrain such particular use of the property as would be

inconsistent with or injurious to the rights of the public. All property is acquired and held under the tacit condition that it shall not be so used as to injure the equal rights of others or greatly impair the public rights and interests of the community."

It may be conceded that the beneficial use and exclusive enjoyment of the property of all carabao owners in these Islands is to a greater or less degree interfered with by the provisions of the statute; and that, without inquiring what quantum of interest thus passes from the owners of such cattle, it is an interest the deprivation of which detracts from their right and authority, and in some degree interferes with their exclusive possession and control of their property, so that if the regulations in question were enacted for purely private purposes, the statute, in so far as these regulations are concerned, would be a violation of the provisions of the Philippine Bill relied on by appellant; but we are satisfied that it is not such a taking, such an interference with the right and title of the owners, as is involved in the exercise by the State of the right of eminent domain, so as to entitle these owners to compensation, and that it is no more than "a just restraint of an injurious private use of the property, which the legislature had authority to impose."

In the case of Com. vs. Alger (7 Cush., 53, 84), wherein the doctrine laid down in Com. vs. Tewksbury (supra) was reviewed and affirmed, the same eminent jurist who wrote the former opinion, in distinguishing the exercise of the

93


right of eminent domain from the exercise of the sovereign police powers of the State, said:

"We think it is a settled principle, growing out of the nature of well-ordered civil society, that every holder of property, however absolute and unqualified may be his title, holds it under the implied liability that his use of it may be so regulated that it shall not be injurious to the equal enjoyment of others having an equal right to the enjoyment of their property, nor injurious to the rights of the community. * * * Rights of property, like all other social and conventional rights, are subject to such reasonable limitations in their enjoyment as shall prevent them from being injurious, and to such reasonable restraints and regulations established by law, as the legislature, under the governing and controlling power vested in them by the constitution, may think necessary and expedient.

"This is very different from the right of eminent domain, the right of a government to take and appropriate private property to public use, whenever the public exigency requires it; which can be done only on condition of providing a reasonable compensation therefor. The power we allude to is rather the police power, the power vested in the legislature by the constitution, to make, ordain, and establish all manner of wholesome and reasonable laws, statutes, and ordinances, either with penalties or without, not repugnant to the constitution, as they shall judge to be for the good and welfare of the commonwealth, and of the subjects of the same.

""It is much easier to perceive and realize the existence and sources of this power than to mark its boundaries or prescribe limits to its exercise."Applying these principles, we are of opinion that the restraint placed by the law on the slaughter for human consumption of carabaos fit for agricultural work and draft purposes is not an appropriation of property interests to a

"public use," and is not, therefore, within the principles of the exercise by the State of the right of eminent domain.

94


It is in fact a mere restriction or limitation upon a private use, which the legislature deemed to be detrimental to the public welfare. And we think that an examination of the general provisions of the statute in relation to the public interests which it seeks to safeguard and the public necessities for which it provides, leaves no room for doubt that the limitations and restraints imposed upon the exercise of rights of ownership by the particular provisions of the statute under consideration were imposed not for private purposes but, strictly, in the promotion of the "general welfare" and "the public interest" in the exercise of the sovereign police power which every State possesses for the general public welfare and which "reaches to every species of property within the commonwealth."

For several years prior to the enactment of the statute a virulent contagious or infectious disease had threatened the total extinction of carabaos in these Islands, in many sections sweeping away seventy, eighty, and in some cases as much as ninety and even one hundred per cent of these animals. Agriculture being the principal occupation of the people, and the carabao being the work animal almost exclusively in use in the fields as well as for draft purposes, the ravages of the disease with which they were infected struck an almost vital blow at the material welfare of the country. Large areas of productive land lay waste for years, and -the production of rice, the staple food of the inhabitants of the Islands, fell off to such an extent that the

impoverished people were compelled to spend many millions of pesos in its importation, notwithstanding the fact that with sufficient work animals to cultivate the fields the arable rice lands of the country could easily be made to produce a supply more than sufficient for its own needs. The drain upon the resources of the Islands was such that famine soon began to make itself felt, hope sank in the breasts of .the people, and in many provinces the energies of the breadwinners seemed to be paralyzed by the apparently hopeless struggle for existence with which they were confronted.

95


To meet these conditions, large sums of money were expended by the Government in relieving the immediate needs of the starving people, three millions of dollars were voted by the Congress of the United States as a relief or famine fund, public works were undertaken to furnish employment in the provinces where the need was most pressing, and every effort made to alleviate the suffering incident to the widespread failure of the crops throughout the Islands, due in large measure to the lack of animals fit for agricultural work and draft purposes.

Such measures, however, could only temporarily relieve the situation, because in an agricultural community material progress and permanent prosperity could hardly be hoped for in the absence of the work animals upon which such a community must necessarily rely for the cultivation of the fields and the transportation of the products of the fields to market. Accordingly efforts were made by the Government to increase the supply of these animals by importation, but,

as appears from the official reports on this subject, hope for the future depended largely on the conservation of those animals which had been spared from the ravages of the disease, and their redistribution throughout the Islands where the need for them was greatest.

At large expense, the services of experts -were employed, with a view to the discovery and application of preventive and curative remedies, and it is hoped that these measures have proved in some degree successful in protecting the present inadequate supply of large cattle, and that the gradual increase and redistribution of these animals throughout the Archipelago, in response to the operation of the laws of supply and demand, will ultimately result in practically relieving those sections which suffered most by the loss of their work animals.

As was to be expected under such conditions, the price of carabaos rapidly increased from three to five fold or more, and it may fairly be presumed that even if the conservative measures now adopted prove entirely successf ul, the scant supply will keep the price of these animals

96


at a high figure until the natural increase shall have more nearly equalized the supply to the demand.

Coincident with and probably intimately connected with this sudden rise in the price of cattle, the crime of cattle stealing became extremely prevalent throughout the Islands, necessitating the enactment of a special law penalizing with the severest penalties the theft of carabaos and other personal property by roving bands; and it must be assumed from the enactment of the statute under consideration that

the legislative authority found that the general welfare of the Islands necessitated the enactment of special and somewhat burdensome provisions for the branding and registration of large cattle, and the supervision and restriction of their slaughter for food. It will hardly be questioned that the provisions of the statute touching the branding and registration of such cattle, and prohibiting and penalizing the slaughter of diseased cattle for food were enacted in the due and proper exercise of the police power of the State; and we are of opinion that, under all the circumstances, the provisions of the statute prohibiting and penalizing the slaughter f or human consumption of carabaos fit for work were in like manner enacted in the due and proper exercise of that power, justified by the exigent necessities of existing conditions, and the right of the State to protect itself against the overwhelming disasters incident to the further reduction of the supply of animals fit for agricultural work or draft purposes.

It is, we think, a fact of common knowledge in these Islands, and disclosed by the official reports and records of the administrative and legislative departments of the Government, that not merely the material welfare and future prosperity of this agricultural community were threatened by the ravages of the disease which swept away the work animals during the years prior to the enactment of the law under consideration, but that the very life and existence of the inhabitants of these Islands as a civilized people would be more or less imperiled by the continued destruction of

97


large cattle by disease or otherwise. Confronted by such

conditions, there can be no doubt of the right of the Legislature to adopt reasonable measures for the preservation of work animals, even to the extent of prohibiting and penalizing what would, under ordinary conditions, be a perfectly legitimate and proper exercise of rights of ownership and control of the private property of the citizen. The police power rests upon necessity and the right of self-protection, and if ever the invasion of private property by police regulation can be justified, we think that the reasonable restriction placed upon the use of carabaos by the provision of the law under discussion must be held to be authorized as a reasonable and proper exercise of that power.

As stated by Mr. Justice Brown in his opinion in the case of Lawton vs. Steele (152 U. S., 133, 136) :

"The extent and limits of what is known as the police power have been a fruitful subject of discussion in the appellate courts of nearly every State in the Union. It is universally conceded to include everything essential to the public safety, health, and morals, and to justify the destruction or abatement, by summary proceedings, of whatever may be regarded as a public nuisance. Under this power it has been held that the State may order the destruction of a house falling to decay or otherwise endangering the lives of passers-by; the demolition of such as are in the path of a conflagration; the slaughter of diseased cattle; the destruction of decayed or unwholesome food; the prohibition of wooden buildings in cities; the regulation of railways and other means of public conveyance, and of interments in burial grounds; the restriction of objectionable trades to certain localities; the compulsory vaccination of children; the confinement of the insane or those afflicted with contagious diseases; the restraint of vagrants, beggars, and habitual drunkards; the

suppression of obscene publications and houses of ill fame; and the prohibition of gambling houses and places where intoxicating liquors are sold.

98


Beyond this, however, the State may. interfere wherever the public interests demand it, and in this particular a large discretion is necessarily vested in the legislature to determine, not only what the interests of the public require, but what measures are necessary for the protection of such interests. (Barbier vs. Connolly, 113 U. S., 27; Kidd vs. Pearson, 128 U. S., 1.) To justify the State in thus interposing its authority in behalf of the public, it must appear, first, that the interests of the public. generally, as distinguished f rom those of a particular class, require such interference; and, second, that the means are reasonably necessary for the accomplishment of the purpose, and not unduly oppressive upon individuals. The legislature may not, under the guise of protecting the public interests, arbitrarily interfere with private business, or impose unusual and unnecessary restrictions upon lawful occupations. In other words, its determination as to what is a proper exercise of its police powers is not final or conclusive, but is subject to the supervision of the courts."

From what has been said, we think it is clear that the enactment of the provisions of the statute under consideration was required by "the interests of the public generally, as distinguished from those of a particular class;" and that the prohibition of the slaughter of carabaos for human consumption, so long as these animals are fit for agricultural work or draft purposes was a "reasonably

necessary" limitation on private ownership, to protect the community from the loss of the services of such animals by their slaughter by improvident owners, tempted either by greed of momentary gain, or by a desire to enjoy the luxury of animal food, even when by so doing the productive power of the community may be measurably and dangerously affected.

Chief Justice Redfield, in Thorpe vs. Rutland & Burlington R. R. Co. (27 Vt, 140), said (p. 149) that by this "general police power of the State, persons and property are subjected to all kinds of restraints and burdens, in order

99


to secure the general comfort, health, and prosperity of the State; of the perfect right in the legislature to do which, no question ever was, or, upon acknowledged and general principles, ever can be made, so far as natural persons are concerned."

And Cooley in his "Constitutional Limitations" (6th ed., p. 738) says:

"It would be quite impossible to enumerate all the instances in which the police power is or may be exercised, because the various cases in which the exercise by one individual of his rights may conflict with a similar exercise by others, or may be detrimental to the public order or safety, are infinite in number and in variety. And there are other cases where it becomes necessary for the public authorities to interfere with the control by individuals of their property, and even to destroy it, where the owners themselves have fully observed all their duties to their f ellows and to the State, but where, nevertheless, some

controlling public necessity demands the interference or destruction. A strong instance of this description is where it becomes necessary to take, use, or destroy the private property of individuals to prevent the spreading of a fire, the ravages of a pestilence, the advance of a hostile army, or any other great public calamity. Here the individual is in no degree in fault, but his interest must yield to that 'necessity' which 'knows no law/ The establishment of limits within the denser portions of cities and villages within which buildings constructed of inflammable materials shall not be erected or repaired may also, in some cases, be equivalent to a destruction of private property; but regulations for this purpose have been sustained notwithstanding this result. Wharf lines may also be established for the general good, even though they prevent the owners of water-fronts from building out on soil which constitutes private property. And, whenever the legislature deem it necessary to the protection of a harbor to f orbid the removal

100


of stones, gravel, or sand from the beach, they may establish regulations to that effect under penalties, and make them applicable to the owners of the soil equally with other persons. Such regulations are only 'a just restraint of an injurious use of property, which the legislature have authority' to impose.

"So a particular use of property may sometimes be forbidden, where, by a change of circumstances, and without the fault of the owner, that which was once lawful, proper, and unobjectionable has now become a public nuisance, endangering the public health or the public safety. Milldams

are sometimes destroyed upon this ground; and churchyards which prove, in the advance of urban population, to be detrimental to the public health, or in danger of becoming so, are liable to be closed against further use for cemetery purposes."

These citations from some of the highest judicial and text-book authorities in the United States clearly indicate the wide scope and extent which has there been given to the doctrine of the sovereign police power of the State, and confirm us in our opinion that the provision of the statute in question being a proper exercise of that power is not in violation of the terms of section 5 of the Philippine Bill, which provide that "no law shall be enacted which shall deprive any person of life, liberty, or property without due process of law," a provision which itself is adopted from the Constitution of the United States, and is f ound in substance in the constitution of most if not all of the States of the Union.

The judgment of conviction and the sentence imposed by the trial court should be affirmed with the costs of this instance against the appellant. So ordered.

Arellano, C. J., Torres, Johnson, Moreland, and Elliott, JJ., concur.

Judgment affirmed.101

VOL. 15, JANUARY 26, 1910Chanco vs. Municipality of Romblon.


836


Metropolitan Manila Development Authority vs. Bel-Air Village Association, Inc.

G.R. No. 135962. March 27, 2000.*

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner, vs. BEL-AIR VILLAGE ASSOCIATION, INC., respondent.

Constitutional Law; Political Subdivision; Police Power; Definition of Police Power.—Police power is an inherent attribute of sovereignty. It has been defined as the power vested by the Constitution in the legislature to make, ordain, and establish all manner of wholesome and reasonable laws, statutes and ordinances, either with penalties or without, not repugnant to the Constitution, as they shall judge to be for the good and welfare of the commongarin

wealth, and for the subjects of the same. The power is plenary and its scope is vast and pervasive, reaching and justifying measures for public health, public safety, public morals, and the general welfare.

Same; Same; Same; Police power is lodged primarily in the National Legislature which may delegate the power to the President and administrative boards as well as the lawmaking bodies of municipal corporations or local government units.—It bears stressing that police power is lodged primarily in the National Legislature. It________________

* FIRST DIVISION.

837

VOL. 328, MARCH 27, 2000Metropolitan Manila Development Authority vs. Bel-Air Village

Association, Inc.cannot be exercised by any group or body of individuals not possessing legislative power. The National Legislature,

however, may delegate this power to the President and administrative boards as well as the lawmaking bodies of municipal corporations or local government units. Once delegated, the agents can exercise only such legislative powers as are conferred on them by the national lawmaking body.

Same; Same; Same; Definition of Local Government.—A local government is a “political subdivision of a nation or state which is constituted by law and has substantial control of local affairs.” The Local Government Code of 1991 defines a local government unit as 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. Local government units are the provinces, cities, municipalities and barangays. They are also the territorial and political subdivisions of the state.

Same; Same; Same; Same; Police power delegated to the local government units in the Local Government Code of 1991.—Our Congress delegated police power to the local government units in the Local Government Code of 1991. This delegation is found in Section 16 of the same Code, known as the general welfare clause.

Same; Same; Same; Same; Local government units exercise police power through their respective legislative bodies.—Local government units exercise police power through their respective legislative bodies. The legislative body of the provincial government is the sangguniang panlalawigan, that of the city government is the sangguniang panlungsod, that of the municipal government is the sangguniang bayan, and that of the barangay is the sangguniang barangay. The Local Government Code of 1991 empowers the sangguniang panlalawigan,

sangguniang panlungsod and sangguniang bayan to “enact ordinances, approve resolutions and appropriate funds for the general welfare of the [province, city or municipality, as the case may be], and its inhabitants pursuant to Section 16 of the Code and in the proper exercise of the corporate powers of the [province, city municipality] provided under the Code x x x.” The same Code gives the sangguniang barangay the power to “enact ordinances as may be necessary to discharge the responsibilities conferred upon it by law or ordinance and to promote the general welfare of the inhabitants thereon.”

838

838



Same; Same; Same; There is no syllable in Republic Act No. 7924 that grants the Metro Manila Development Authority police power, let alone legislative power.—It will be noted that the powers of the MMDA are limited to the following acts: formulation, coordination, regulation, implementation, preparation, management, monitoring, setting of policies, installation of a system and administration. There is no syllable in R.A. No. 7924 that grants the MMDA police power, let alone legislative power. Even the Metro Manila Council has not been delegated any legislative power. Unlike the legislative bodies of the local government units, there is no provision in R.A. No. 7924 that empowers the MMDA or its Council to “enact ordinances, approve resolutions and appropriate funds for the general welfare” of the inhabitants of Metro Manila. The MMDA is, as termed in the charter itself, a “development

authority.”Same; Same; Same; Metro Manila Development

Authority is not a political unit of government.—Clearly, the MMDA is not a political unit of government. The power delegated to the MMDA is that given to the Metro Manila Council to promulgate administrative rules and regulations in the implementation of the MMDA’s functions. There is no grant of authority to enact ordinances and regulations for the general welfare of the inhabitants of the metropolis.

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

839


Association, Inc.

Same; Same; Same; Unlike the Metro Manila Commission, the Metro Manila Development Authority has no power to enact ordinances for the welfare of the community.—Clearly then, the MMC under P.D. No. 824 is not the same entity as the MMDA under R.A. No. 7924. Unlike the MMC, the MMDA has no power to enact ordinances for the welfare of the community. It is the local government units, acting through their respective legislative councils, that possess legislative power and police power. In the case at bar, the Sangguniang Panlungsod of Makati City did not pass any ordinance or resolution ordering the opening of Neptune Street, hence, its proposed opening by petitioner MMDA is illegal and the respondent Court of Appeals did not err in so ruling.PETITION for review on certiorari of a decision of the Court of Appeals.

The facts are stated in the opinion of the Court. The Solicitor General for petitioner. R.A.V. Saguisag and J. Vicente G. Sison for

respondent.PUNO, J.:

Not infrequently, the government is tempted to take legal shortcuts to solve urgent problems of the people. But even when government is armed with the best of intention, we cannot allow it to run roughshod over the rule of law. Again, we let the hammer fall and fall hard on the illegal attempt of the MMDA to open for public use a private road in a private subdivision. While we hold that the general welfare should be promoted, we stress that it should not be achieved at the expense of the rule of law.

Petitioner MMDA is a government agency tasked with

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

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

“SUBJECT: NOTICE of the Opening of Neptune Street to Traffic“Dear President Lindo,

“Please be informed that pursuant to the mandate of the MMDA law or Republic Act No. 7924 which requires the Authority to rationalize the use of roads and/or thoroughfares for the safe and convenient movement of persons, Neptune Street shall be opened to vehicular traffic effective January 2, 1996.

“In view whereof, the undersigned requests you to voluntarily open the points of entry and exit on said street.

“Thank you for your cooperation and whatever assistance that may be extended by your association to the MMDA personnel who will be directing traffic in the area.

“Finally, we are furnishing you with a copy of the handwritten instruction of the President on the matter.

“Very truly yours, PROSPERO I. ORETA Chairman”1

On the same day, respondent was apprised that the perimeter wall separating the subdivision from the adjacent Kalayaan Avenue would be demolished.

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

1 Annex “D” to the CA petition, Court of Appeals (CA) Rollo, p. 27.

841


Association, Inc.On January 23, 1996, after due hearing, the trial court denied issuance of a preliminary injunction.2 Respondent questioned the denial before the Court of Appeals in CA-G.R. SP No. 39549. The appellate court conducted an ocular inspection of Neptune Street3 and on February 13, 1996, it issued a writ of preliminary injunction enjoining the implementation of the MMDA’s proposed action.4

On January 28, 1997, the appellate court rendered a Decision on the merits of the case finding that the MMDA has no authority to order the opening of Neptune Street, a private subdivision road and cause the demolition of its perimeter walls. It held that the authority is lodged in the City Council of Makati by ordinance. The decision disposed of as follows:

“WHEREFORE, the Petition is GRANTED; the challenged Order dated January 23, 1995, in Civil Case No. 96-001, is SET ASIDE and the Writ of Preliminary Injunction issued on February 13, 1996 is hereby made permanent.

“For want of sustainable substantiation, the Motion to Cite Roberto L. del Rosario in contempt is denied.5

“No pronouncement as to costs.“SO ORDERED.”6

The Motion for Reconsideration of the decision was denied on September 28, 1998. Hence, this recourse.

Petitioner MMDA raises the following questions:__________________

2 Annex “J” to Petition, Rollo, pp. 76-78.3 Minutes of the Ocular Inspection, Court of Appeals

Rollo, pp. 193-194.4 CA Rollo, p. 332.5 Roberto L. del Rosario is a resident of Neptune Street

who allegedly spearheaded a campaign to open Neptune Street to the public—Motion to Cite in Contempt, CA Rollo, pp. 412-415.

6 CA decision, p. 10, Rollo, p. 61.842

842


Metropolitan Manila Development Authority vs. Bel-Air Village Association, Inc.“I

HAS THE METROPOLITAN MANILA DEVELOPMENT AUTHORITY (MMDA) THE MANDATE TO OPEN NEPTUNE STREET TO PUBLIC TRAFFIC PURSUANT TO ITS REGULATORY AND POLICE POWERS?

II

IS THE PASSAGE OF AN ORDINANCE A CONDITION PRECEDENT BEFORE THE MMDA MAY ORDER THE OPENING OF SUBDIVISION ROADS TO PUBLIC TRAFFIC?

III

IS RESPONDENT BEL-AIR VILLAGE ASSOCIATION, INC. ESTOPPED FROM DENYING OR ASSAILING THE AUTHORITY OF THE MMDA TO OPEN THE SUBJECT STREET?

IV

WAS RESPONDENT DEPRIVED OF DUE PROCESS DESPITE THE SEVERAL MEETINGS HELD BETWEEN MMDA AND THE AFFECTED BEL-AIR RESIDENTS AND BAVA OFFICERS?

V

HAS RESPONDENT COME TO COURT WITH UNCLEAN HANDS?”7Neptune Street is owned by respondent BAVA. It is a private road inside Bel-Air Village, a private residential subdivision in the heart of the financial and commercial district of Makati City. It runs parallel to Kalayaan Avenue, a national road open to the general public. Dividing the two (2) streets is a concrete perimeter wall approximately fifteen (15) feet high. The western end of Neptune Street intersects Nicanor Garcia, formerly Reposo Street, a subdivision road open to public vehicular traffic, while its eastern end intersects Makati Avenue, a national road. Both ends of Neptune Street are guarded by iron gates.

Petitioner MMDA claims that it has the authority to open Neptune Street to public traffic because it is an agent of the_________________

7 Petition, p. 15, Rollo, p. 24.843


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

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

It bears stressing that police power is lodged primarily in the National Legislature.12 It cannot be exercised by any group or body of individuals not possessing legislative

power.13 The National Legislature, however, may delegate this power to the President and administrative boards as well as the lawmaking bodies of municipal corporations or local govern-___________________

8 168 SCRA 634 (1988).9 Petition, p. 24, Rollo, p. 33.10 United States v. Pompeya, 31 Phil. 245, 253-254

[1915]; Churchill v. Rafferty, 32 Phil. 580, 603 [1915]; People v. Pomar, 46 Phil. 440, 447 [1924].

11 Bernas, The 1987 Constitution of the Philippines, A Commentary, pp. 95-98 [1996].

12 Cruz, Constitutional Law, p. 44 [1995].13 Id., see also 16 C.J.S., Constitutional Law, Sec. 177

[1956 ed.].844

844



ment units.14 Once delegated, the agents can exercise only such legislative powers as are conferred on them by the national lawmaking body.15

A local government is a “political subdivision of a nation or state which is constituted by law and has substantial control of local affairs.”16 The Local Government Code of 1991 defines a local government unit as a “body politic and corporate”17—one endowed with powers as a political subdivision of the National Government and as a corporate entity representing the inhabitants of its territory.18 Local government units are the provinces, cities, municipalities and barangays.19 They are also the territorial and political

subdivisions of the state.20Our Congress delegated police power to the local

government units in the Local Government Code of 1991. This delegation is found in Section 16 of the same Code, known as the general welfare clause, viz..“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____________________

14 Cruz, supra, at 44; Binay v. Domingo, 201 SCRA 508, 513-514 [1991].

15 Magtajas v. Pryce Properties, 234 SCRA 255, 272 [1994].

16 Bernas, supra, at 959, citing UP Law Center Revision Project, Part II, 712 [1970] citing Sady, “Improvement of Local Government Administration for Development Purpose,” Journal of Local Administration Overseas 135 [July 1962].

17 Section 15, Book I, Local Government Code of 1991.18 Id.19 Titles I, II, III, IV, Book III, Local Government Code

of 1991.

20 Section 1, Article X, 1987 Constitution.845


Association, Inc.justice, promote full employment among their residents, maintain peace and order, and preserve the comfort and convenience of their inhabitants.”21Local government units exercise police power through their respective legislative bodies. The legislative body of the provincial government is the sangguniang panlalawigan, that of the city government is the sangguniang panlungsod, that of the municipal government is the sangguniang bayan, and that of the barangay is the sangguniang barangay. The Local Government Code of 1991 empowers the sangguniang panlalawigan, sangguniang panlungsod and sangguniang bayan to “enact ordinances, approve resolutions and appropriate funds for the general welfare of the [province, city or municipality, as the case may be], and its inhabitants pursuant to Section 16 of the Code and in the proper exercise of the corporate powers of the [province, city municipality] provided under the Code x x x.”22 The same Code gives the sangguniang barangay the power to “enact ordinances as may be necessary to discharge the responsibilities conferred upon it by law or ordinance and to promote the general welfare of the inhabitants thereon.”23

Metropolitan or Metro Manila is a body composed of several local government units—i.e., twelve (12) cities and five (5) municipalities, namely, the cities of Caloocan, Manila, Mandaluyong, Makati, Pasay, Pasig, Quezon, Muntinlupa, Las Pinas, Marikina, Parañaque and Valenzuela, and the municipalities of Malabon, Navotas,

Pateros, San Juan and Taguig. With the passage of Republic Act (R.A.) No. 792424 in 1995, Metropolitan Manila was declared as a “special development___________________

21 Section 16, Book I, Local Government Code of 1991; also cited in Magtajas v. Pryce Properties Corp., Inc. supra, at 264-265.

22 Sections 468 (a), 458 (a), and 447 (a), Book III, Local Government Code of 1991.

23 Section 391 (a), Book III, Local Government Code of 1991.

24 Entitled “An Act Creating the Metropolitan Manila Development Authority, Defining its Powers and Functions, Providing Funds Therefor and for Other Purposes.”

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and administrative region” and the Administration of “metrowide” basic services affecting the region placed under “a development authority” referred to as the MMDA.25

“Metro-wide services” are those “services which have metrowide impact and transcend local political boundaries or entail huge expenditures such that it would not be viable for said services to be provided by the individual local government units comprising Metro Manila.”26 There are seven (7) basic metro-wide services and the scope of these services cover the following: (1) development planning; (2) transport and traffic management; (3) solid waste disposal and management; (4) flood control and sewerage

management; (5) urban renewal, zoning and land use planning, and shelter services; (6) health and sanitation, urban protection and pollution control; and (7) public safety. The basic service of transport and traffic management includes the following:“(b) Transport and traffic management which include the formulation, coordination, and monitoring of policies, standards, programs and projects to rationalize the existing transport operations, infrastructure requirements, the use of thoroughfares, and promotion of safe and convenient movement of persons and goods; provision for the mass transport system and the institution of a system to regulate road users; administration and implementation of all traffic enforcement operations, traffic engineering services and traffic education programs, including the institution of a single ticketing system in Metropolitan Manila;”27In the delivery of the seven (7) basic services, the MMDA has the following powers and functions:“Sec. 5. Functions and powers of the Metro Manila Development Authority.—The MMDA shall:

12. (a)Formulate, coordinate and regulate the implementation of medium and long-term plans and

programs for the delivery of metrowide services, land use and physical development within Metropoli-

__________________

25 Section 1, R.A. 7924.26 Section 3, par. 1, R.A. 7924.27 Section 3 (b), supra; emphasis supplied.

847


Association, Inc.

7.tan Manila, consistent with national development objectives and priorities;

8.(b)Prepare, coordinate and regulate the implementation of medium-term investment programs for metro-wide

services which shall indicate sources and uses of funds for priority programs and projects, and which

shall include the packaging of projects and presentation to funding institutions;

9.(c)Undertake and manage on its own metro-wide programs and projects for the delivery of specific services under its jurisdiction, subject to the approval of the Council.

For this purpose, MMDA can create appropriate project management offices;

10. (d)Coordinate and monitor the implementation of such plans, programs and projects in Metro Manila;

identify bottlenecks and adopt solutions to problems of implementation;

11. (e)The MMDA shall set the policies concerning traffic in Metro Manila, and shall coordinate and regulate

the implementation of all programs and projects concerning traffic management, specifically pertaining to enforcement, engineering and

education. Upon request, it shall be extended assistance and cooperation, including but not limited to, assignment of personnel, by all other government

agencies and offices concerned;12. (f)Install and administer a single ticketing system, fix,

impose and collect fines and penalties for all kinds of violations of traffic rules and regulations, whether

moving or non-moving in nature, and confiscate and suspend or revoke drivers’ licenses in the

enforcement of such traffic laws and regulations, the provisions of RA 4136 and PD 1605 to the contrary

notwithstanding. For this purpose, the Authority shall impose all traffic laws and regulations in Metro

Manila, through its traffic operation center, and may deputize members of the PNP, traffic enforcers of

local government units, duly licensed security guards, or members of non-governmental organizations to

whom may be delegated certain authority, subject to such conditions and requirements as the Authority

may impose; and13. (g)Perform other related functions required to achieve

the objectives of the MMDA, including the undertaking of delivery of basic services to the local

government units, when deemed necessary subject to prior coordination with and consent of the local

government unit concerned.”The implementation of the MMDA’s plans, programs and projects is undertaken by the local government units, national

848

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government agencies, accredited people’s organizations, nongovernmental organizations, and the private sector as well as by the MMDA itself. For this purpose, the MMDA has the power to enter into contracts, memoranda of agreement and other cooperative arrangements with these bodies for the delivery of the required services within Metro Manila.28

The governing board of the MMDA is the Metro Manila Council. The Council is composed of the mayors of the

component 12 cities and 5 municipalities, the president of the Metro Manila Vice-Mayors’ League and the president of the Metro Manila Councilors’ League.29 The Council is headed by a Chairman who is appointed by the President and vested with the rank of cabinet member. As the policy-making body of the MMDA, the Metro Manila Council approves metro-wide plans, programs and projects, and issues the necessary rules and regulations for the implementation of said plans; it approves the annual budget of the MMDA and promulgates the rules and regulations for the delivery of basic services, collection of service and regulatory fees, fines and penalties. These functions are particularly enumerated as follows:“Sec. 6. Functions of the Metro Manila Council.—12. (a)The Council shall be the policy-making body of the

MMDA;13. (b)It shall approve metro-wide plans, programs and

projects and issue rules and regulations deemed necessary by the MMDA to carry out the purposes of

this Act;14. (c)It may increase the rate of allowances and per

diems of the members of the Council to be effective during the term of the succeeding Council. It shall fix

the compensation of the officers and__________________

28 Section 9, paragraph 5, supra.29 Section 4, supra. Non-voting members of the Council

are the heads of the Department of Transportation and Communications (DOTC), Department of Public Works and Highways (DPWH), Department of Tourism (DOT), Department of Budget and Management (DBM), Housing and Urban Development Coordinating Committee

(HUDCC), and the Philippine National Police (PNP) or their duly authorized representatives.

849


Association, Inc.3.personnel of the MMDA, and approve the annual budget

thereof for submission to the Department of Budget and Management (DBM);

4.(d)It shall promulgate rules and regulations and set policies and standards for metro-wide application

governing the delivery of basic services, prescribe and collect service and regulatory fees, and impose and

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

violations.It will be noted that the powers of the MMDA are

limited to the following acts: formulation, coordination, regulation, implementation, preparation, management, monitoring, setting of policies, installation of a system and administration. There is no syllable in R.A. No. 7924 that grants the MMDA police power, let alone legislative power. Even the Metro Manila Council has not been delegated any legislative power. Unlike the legislative bodies of the local government units, there is no provision in R.A. No. 7924 that empowers the MMDA or its Council to “enact ordinances, approve resolutions and appropriate funds for the general welfare” of the inhabitants of Metro Manila. The MMDA is, as termed in the charter itself, a

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“development authority.”30 It is an agency created for the purpose of laying down policies and coordinating with the various national government agencies, people’s organizations, non-governmental organizations and the private sector for the efficient and expeditious delivery of basic services in the vast metropolitan area. All its functions are administrative in nature and these are actually summed up in the charter itself, viz.:“Sec. 2. Creation of the Metropolitan Manila Development Authority.—x x x.

The MMDA shall perform planning, monitoring and coordinative functions, and in the process exercise regulatory and supervisory authority over the delivery of

metro-wide services within Metro Manila, without diminution of the autonomy of the local government units concerning purely local matters.”31Petitioner cannot seek refuge in the cases of Sangalang v. Intermediate Appellate Court32 where we upheld a zoning ordinance issued by the Metro Manila Commission (MMC), the predecessor of the MMDA, as an exercise of police power. The first Sangalang decision was on the merits of the petition,33 while the second decision denied reconsideration of the first case and in addition discussed the case of Yabut v. Court of Appeals.34

Sangalang v. IAC involved five (5) consolidated petitions filed by respondent BAVA and three residents of Bel-Air Village against other residents of the Village and the Ayala Corporation, formerly the Makati Development Corporation, as the developer of the subdivision. The petitioners sought to enforce certain restrictive easements in the deeds of sale over their respective lots in the subdivision. These were the prohibition on the setting up of commercial and advertising signs__________________

30 Section 1, R.A. 7924.31 Section 2, supra.32 Op cit.33 168 SCRA 634 [1988].34 176 SCRA 719 [1989].

851


Association, Inc.on the lots, and the condition that the lots be used only for residential purposes. Petitioners alleged that respondents,

who were residents along Jupiter Street of the subdivision, converted their residences into commercial establishments in violation of the “deed restrictions,” and that respondent Ayala Corporation ushered in the full “commercialization” of Jupiter Street by tearing down the perimeter wall that separated the commercial from the residential section of the village.35

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

We ruled that since both Ordinances recognized Jupiter Street as the boundary between Bel-Air Village and the commercial district, Jupiter Street was not for the exclusive benefit of Bel-Air residents. We also held that the perimeter wall on said street was constructed not to separate the residential from the commercial blocks but simply for security reasons, hence, in tearing down said wall, Ayala Corporation did not violate the “deed restrictions” in the deeds of sale.

We upheld the ordinances, specifically MMC Ordinance No. 81-01, as a legitimate exercise of police power.37 The power of the MMC and the Makati Municipal Council to enact zoning ordinances for the general welfare prevailed over the “deed restrictions.”

In the second Sangalang/Yabut decision, we held that the opening of Jupiter Street was warranted by the demands of________________

35 168 SCRA 634, 654-655.36 Id. at 643.37 Id, at 730.

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

Contrary to petitioner’s claim, the two Sangalang cases do not apply to the case at bar. Firstly, both involved zoning ordinances passed by the municipal council of Makati and the MMC. In the instant case, the basis for the proposed opening of Neptune Street is contained in the notice of December 22, 1995 sent by petitioner to respondent BAVA, through its president. The notice does not cite any ordinance or law, either by the Sangguniang Panlungsod of Makati City or by the MMDA, as the legal basis for the proposed opening of Neptune Street. Petitioner MMDA simply relied

on its authority under its charter “to rationalize the use of roads and/or thoroughfares for the safe and convenient movement of persons.” Rationalizing the use of roads and thoroughfares is one of the acts that fall within the scope of transport and traffic management. By no stretch of the imagination, however, can this be interpreted as an express or implied grant of ordinancemaking power, much less police power.

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

Metropolitan Manila was first created in 1975 by Presidential Decree (P.D.) No. 824. It comprised the Greater Manila______________

38 Id. at 723.39 Like the perimeter wall along Jupiter Street—Id. at

734.853


Association, Inc.Area composed of the contiguous four (4) cities of Manila, Quezon, Pasay and Caloocan, and the thirteen (13) municipalities of Makati, Mandaluyong, San Juan, Las Piñas, Malabon, Navotas, Pasig, Pateros, Parañaque, Marikina, Muntinlupa and Taguig in the province of Rizal, and Valenzuela in the province of Bulacan.40 Metropolitan Manila was created as a response to the finding that the

rapid growth of population and the increase of social and economic requirements in these areas demand a call for simultaneous and unified development; that the public services rendered by the respective local governments could be administered more efficiently and economically if integrated under a system of central planning; and this coordination, “especially in the maintenance of peace and order and the eradication of social and economic ills that fanned the flames of rebellion and discontent [were] part of reform measures under Martial Law essential to the safety and security of the State.”41 Metropolitan Manila was established as a “public corporation” with the following powers:“Section 1. Creation of the Metropolitan Manila.—There is hereby created a public corporation, to be known as the Metropolitan Manila, vested with powers and attributes of a corporation including the power to make contracts, sue and be sued, acquire, purchase, expropriate, hold, transfer and dispose of property and such other powers as are necessary to carry out its purposes. The Corporation shall be administered by a Commission created under this Decree.”42The administration of Metropolitan Manila was placed under the Metro Manila Commission (MMC) vested with the following powers:“Sec. 4. Powers and Functions of the Commission.—The Commission shall have the following powers and functions:

3.1.To act as a central government to establish and administer programs and provide services common to

the area;_______________

40 Section 2, P.D. 824.

41 Whereas Clauses, P.D. 824.42 Section 1, P.D. 824; emphasis supplied.

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3.2.To levy and collect taxes and special assessments, borrow and expend money and issue bonds, revenue

certificates, and other obligations of indebtedness. Existing tax measures should, however, continue to be

operative until otherwise modified or repealed by the Commission;

4.3.To charge and collect fees for the use of public service facilities;

5.4.To appropriate money for the operation of the metropolitan government and review appropriations

for the city and municipal units within its jurisdiction with authority to disapprove the same if found to be

not in accordance with the established policies of the Commission, without prejudice to any contractual obligation of the local government units involved

existing at the time of approval of this Decree;6.5.To review, amend, revise or repeal all ordinances,

resolutions and acts of cities and municipalities within Metropolitan Ma-nila;

7.6.To enact or approve ordinances, resolutions and to fix penalties for any violation thereof which shall not

exceed a fine of P10,000.00 or imprisonment of six years or both such fine and imprisonment for a single

offense;8.7.To perform general administrative, executive and

policymaking functions;9.8.To establish a fire control operation center, which shall

direct the fire services of the city and municipal governments in the metropolitan area;

10. 9.To establish a garbage disposal operation center, which shall direct garbage collection and disposal in

the metropolitan area;11. 10.To establish and operate a transport and traffic

center, which shall direct traffic activities;12. 11.To coordinate and monitor governmental and

private activities pertaining to essential services such as transportation, flood control and drainage, water

supply and sewerage, social, health and environmental services, housing, park development, and others;

13. 12.To insure and monitor the undertaking of a comprehensive social, economic and physical

planning and development of the area;14. 13.To study the feasibility of increasing barangay

participation in the affairs of their respective local governments and to pro-

855


Association, Inc.2.pose to the President of the Philippines definite programs

and policies for implementation;3.14.To submit within thirty (30) days after the close of each

fiscal year an annual report to the President of the Philippines and to submit a periodic report whenever

deemed necessary; and4.15.To perform such other tasks as may be assigned or

directed by the President of the Philippines.”

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

P.D. No. 824 further provided:“Sec. 9. Until otherwise provided, the governments of the four cities and thirteen municipalities in the Metropolitan Manila shall continue to exist in their present form except as may be inconsistent with this Decree. The members of the existing city and municipal councils in Metropolitan Manila shall, upon promulgation of this Decree, and until December 31, 1975, become members of the Sangguniang Bayan which is hereby created for every city and municipality of Metropolitan Manila.

In addition, the Sangguniang Bayan shall be composed of as many barangay captains as may be determined and chosen by the Commission, and such number of representatives from other sectors of the society as may be appointed by the President upon recommendation of the Commission.

x x x.The Sangguniang Bayan may recommend to the

Commission ordinances, resolutions or such measures as it may adopt; Provided,

856

856



that no such ordinance, resolution or measure shall become effective, until after its approval by the Commission; and Provided further, that the power to impose taxes and other levies, the power to appropriate money and the power to pass ordinances or resolutions with penal sanctions shall be vested exclusively in the Commission.”The creation of the MMC also carried with it the creation of the Sangguniang Bayan. This was composed of the members of the component city and municipal councils, barangay captains chosen by the MMC and sectoral representatives appointed by the President. The Sangguniang Bayan had the power to recommend to the MMC the adoption of ordinances, resolutions or measures. It was the MMC itself, however, that possessed legislative powers. All ordinances, resolutions and measures recommended by the Sangguniang Bayan were subject to the MMC’s approval. Moreover, the power to impose taxes and other levies, the power to appropriate money, and the power to pass ordinances or resolutions with penal sanctions were vested exclusively in the MMC.

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

After President Corazon Aquino assumed power, there was a clamor to restore the autonomy of the local

government units in Metro Manila. Hence, Sections 1 and 2 of Article X of the 1987 Constitution provided:“Section 1. The territorial and political subdivisions of the Republic of the Philippines are the provinces, cities, municipalities and barangays. There shall be autonomous regions in Muslim Mindanao and the Cordilleras as herein provided.

Section 2. The territorial and political subdivisions shall enjoy local autonomy.”The Constitution, however, recognized the necessity of creating metropolitan regions not only in the existing National Capital Region but also in potential equivalents in the

857


Association, Inc.Visayas and Mindanao.43 Section 11 of the same Article X thus provided:“Section 11. The Congress may, by law, create special metropolitan political subdivisions, subject to a plebiscite as set forth in Section 10 hereof. The component cities and municipalities shall retain their basic autonomy and shall be entitled to their own local executives and legislative assemblies. The jurisdiction of the metropolitan authority that will thereby be created shall be limited to basic services requiring coordination.”The Constitution itself expressly provides that Congress may, by law, create “special metropolitan political subdivisions” which shall be subject to approval by a majority of the votes cast in a plebiscite in the political units directly affected; the jurisdiction of this subdivision shall be

limited to basic services requiring coordination; and the cities and municipalities comprising this subdivision shall retain their basic autonomy and their own local executive and legislative assemblies.44 Pending enactment of this law, the Transitory Provisions of the Constitution gave the President of the Philippines the power to constitute the Metropolitan Authority, viz.:“Section 8. Until otherwise provided by Congress, the President may constitute the Metropolitan Authority to be composed of the heads of all local government units comprising the Metropolitan Manila area.”45In 1990, President Aquino issued Executive Order (E.O.) No. 392 and constituted the Metropolitan Manila Authority (MMA). The powers and functions of the MMC were devolved to the MMA.46 It ought to be stressed, however, that not all powers and functions of the MMC were passed to the MMA.__________________

43 Speech of then Constitutional Commissioner Bias Ople, see Bernas, The Intent of the 1986 Constitution Writers, pp. 706-707 [1995].

44 Section 11, Article X, 1987 Constitution.45 Section 8, Article XVIII, 1987 Constitution.46 Section 3, E.O. 392.

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The MMA’s power was limited to the “delivery of basic urban services requiring coordination in Metropolitan Manila.”47 The MMA’s governing body, the Metropolitan

Manila Council, although composed of the mayors of the component cities and municipalities, was merely given the power of: (1) formulation of policies on the delivery of basic services requiring coordination and consolidation; and (2) promulgation of resolutions and other issuances, approval of a code of basic services and the exercise of its rule-making power.48

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

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

R.A. No. 7924 originated as House Bill No. 14170/11116 and was introduced by several legislators led by Dante Tinga, Roilo Golez and Feliciano Belmonte. It was presented to the House of Representatives by the Committee on Local Governments chaired by Congressman Ciriaco R. Alfelor. The bill was a product of Committee consultations

with the local gov-________________

47 Section 1, supra.48 Section 2, supra.49 Section 6, supra.

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Association, Inc.ernment units in the National Capital Region (NCR), with former Chairmen of the MMC and MMA,50 and career officials of said agencies. When the bill was first taken up by the Committee on Local Governments, the following debate took place:“THE CHAIRMAN [Hon. Ciriaco Alfelor]: Okay, Let me explain. This has been debated a long time ago, you know. It’s a special... we can create a special metropolitan political subdivision.

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

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

THE CHAIRMAN: That’s correct. But it is considered to be a political subdivision. What is the meaning of a political subdivision? Meaning to say, that it has its own government, it has its own political personality, it has the power to tax, and all governmental powers: police power and everything. All right. Authority is different; because it does not have its

own government. It is only a council, it is an organization of political subdivision, powers,‘no, which is not imbued with any political power.

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

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

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

50 Chairmen Ismael Mathay, Jr. and Ignacio Bunye.860

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members and then set up a policy in order that the basic services can be effectively coordinated. All right.

Of course, we cannot deny that the MMDA has to survive. We have to provide some funds, resources. But it does not possess any political power. We do not elect the Governor. We do not have the power to tax. As a matter of fact, I was trying to intimate to the author that it must have

the power to sue and be sued because it coordinates. All right. It coordinates practically all these basic services so that the flow and the distribution of the basic services will be continuous. Like traffic, we cannot deny that. It’s before our eyes. Sewerage, flood control, water system, peace and order, we cannot deny these. It’s right on our face. We have to look for a solution. What would be the right solution? All right, we envision that there should be a coordinating agency and it is called an authority. All right, if you do not want to call it an authority, it’s alright. We may call it a council or maybe a management agency.

x x x.”51Clearly, the MMDA is not a political unit of government. The power delegated to the MMDA is that given to the Metro Manila Council to promulgate administrative rules and regulations in the implementation of the MMDA’s functions. There is no grant of authority to enact ordinances and regulations for the general welfare of the inhabitants of the metropolis. This was explicitly stated in the last Committee deliberations prior to the bill’s presentation to Congress. Thus:“THE CHAIRMAN: Yeah, but we have to go over the

suggested revision. I think this was already approved before, but it was reconsidered in view of the proposals, set-up, to make the MMDA stronger. Okay, so if there is no objection to paragraph “f”. . . And then next is paragraph “b,” under Section 6. “It shall approve metrowide plans, programs and projects and issue ordinances or resolutions deemed necessary by the MMDA to carry out the purposes of this Act.” Do you have the powers? Does the MMDA . . . because that takes the form of a local government unit, a political subdivision.

____________________

51 Deliberations of the Committee on Local Government, House of Representatives, Congress of the Philippines, November 10, 1993, pp. 46-48.

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Association, Inc.HON. [Feliciano] BELMONTE: Yes, I believe so, your

Honor. When we say that it has the policies, it’s very clear that those policies must be followed. Otherwise, what’s the use of empowering it to come out with policies. Now, the policies may be in the form of a resolution or it may be in the form of a ordinance. The term “ordinance” in this case really gives it more teeth, your honor. Otherwise, we are going to see a situation where you have the power to adopt the policy but you cannot really make it stick as in the case now, and I think here is Chairman Bunye. I think he will agree that that is the case now. You’ve got the power to set a policy, the body wants to follow your policy, then we say let’s call it an ordinance and see if they will not follow it.

THE CHAIRMAN: That’s very nice. I like that. However, there is a constitutional impediment. You are making this MMDA a political subdivision. The creation of the MMDA would be subject to a plebiscite. That is what I’m trying to avoid. I’ve been trying to avoid this kind of predicament. Under the Constitution it states: if it is a political subdivision, once it is created it has to be subject to a plebiscite. I’m trying to make this as administrative. That’s why we place the Chairman as a cabinet rank.

HON. BELMONTE: All right, Mr. Chairman, okay, what you are saying there is . . . .

THE CHAIRMAN: In setting up ordinances, it is a political exercise. Believe me.

HON. [Elias] LOPEZ: Mr. Chairman, it can be changed into issuances of rules and regulations. That would be . . . it shall also be enforced.

HON. BELMONTE: Okay, I will . . . .HON. LOPEZ: And you can also say that violation of such

rule, you impose a sanction. But you know, ordinance has a different legal connotation.

HON. BELMONTE: All right. I defer to that opinion, your Honor.

THE CHAIRMAN: So instead of ordinances, say rules and regulations.

HON. BELMONTE: Or resolutions. Actually, they are actually considering resolutions now.

THE CHAIRMAN: Rules and resolutions.862

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HON. BELMONTE: Rules, regulations and resolutions.”52The draft of H.B. No. 14170/11116 was presented by the Committee to the House of Representatives. The explanatory note to the bill stated that the proposed MMDA is a “development authority” which is a “national agency, not a political government unit.”53 The explanatory note was adopted as the sponsorship speech of the Committee on Local Governments. No interpellations or debates were made on the floor and no amendments introduced. The bill

was approved on second reading on the same day it was presented.54

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

It is thus beyond doubt that the MMDA is not a local government unit or a public corporation endowed with legislative power. It is not even a “special metropolitan political subdivision” as contemplated in Section 11, Article X of the Constitution. The creation of a “special metropolitan political subdivision” requires the approval by a majority of the votes cast in a plebiscite in the political units directly affected.56 R.A. No. 7924 was not submitted to the inhabitants of Metro Manila in________________

52 Deliberations of the Committee on Local Governments, House of Representatives, Congress of the Philippines, November 9, 1994, pp. 68-70.

53 Explanatory Note to H.B. 11116, p. 3.54 H.B. 14170/11116, Sponsorship and Debates,

December 20, 1994.55 Compare H.B. 14170/11116 with R.A. 7924; see

Senate Amendments, February 21, 1995.56 Section 10, Article X of the 1987 Constitution reads:

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

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Association, Inc.a plebiscite. The Chairman of the MMDA is not an official elected by the people, but appointed by the President with the rank and privileges of a cabinet member. In fact, part of his function is to perform such other duties as may be assigned to him by the President,57 whereas in local government units, the President merely exercises supervisory authority. This emphasizes the administrative character of the MMDA.

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

We stress that this decision does not make light of the MMDA’s noble efforts to solve the chaotic traffic condition in Metro Manila. Everyday, traffic jams and traffic bottlenecks plague the metropolis. Even our once sprawling boulevards and avenues are now crammed with cars while city streets are clogged with motorists and pedestrians. Traffic has become a social malaise affecting our people’s productivity and the efficient delivery of goods and services in the country. The MMDA was created to put some order in

the metropolitan transportation system but unfortunately the powers granted by its charter are limited. Its good intentions cannot justify the opening for public use of a private street in a private subdivision without any legal warrant. The promotion of the general welfare is not antithetical to the preservation of the rule of law._________________

57 Section 7 (g), R.A. 7924.864

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

SO ORDERED. Davide, Jr. (C.J., Chairman), Kapunan, Pardo and

Ynares-Santiago, JJ., concur.Petition denied, judgment and resolution affirmed.Note.—In order that a local government may exercise

police power, there must be a legislative grant which necessarily sets the limits for the exercise of the power. (Tano vs. Socrates, 278 SCRA 154 [1997])

——o0o——


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Metropolitan Manila Development Authority vs. GarinG.R. No. 130230. April 15, 2005.*

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner, vs. DANTE O. GARIN, respondent.

Metropolitan Manila Development Authority; Driver’s Licenses; Actions; Moot and Academic Questions; Since the MMDA is not precluded from re-implementing Memorandum Circular No. TT-95-001, or any other scheme, for that matter, that would entail confiscating driver’s licenses, the Supreme Court deems it appropriate to make certain observations for the proper implementation of MMDA’s future programs.—On 12 August 2004, the MMDA, through its Chairman Bayani Fernando, implemented Memorandum Circular No. 04, Series of 2004, outlining the procedures for the use of the Metropolitan Traffic Ticket (MTT) scheme. Under the circular, erring motorists are issued an MTT, which can be paid at any Metrobank branch. Traffic enforcers may no longer confiscate drivers’ licenses as a matter of course in cases of traffic violations. All motorists with unredeemed TVRs were given seven days from the date of implementation of the new system to pay their fines and redeem their license or vehicle plates. It would seem, therefore, that insofar as the absence of a prima facie case to enjoin the petitioner from confiscating drivers’ licenses is concerned, recent events have overtaken the Court’s need to decide this case, which has been rendered moot and academic by the implementation of Memorandum Circular No. 04, Series of 2004. The petitioner, however, is not precluded from re-implementing Memorandum Circular No. TT-95-001, or any other scheme, for that matter, that would entail confiscating drivers’ licenses. For the proper implementation, therefore, of the petitioner’s_______________

* SECOND DIVISION.

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VOL. 456, APRIL 15, 2005Metropolitan Manila Development Authority vs. Garin

future programs, this Court deems it appropriate to make the following observations: 1. A license to operate a motor vehicle is a privilege that the state may withhold in the exercise of its police power.

Same; Same; A license to operate a motor vehicle is not a property right, but a privilege granted by the state, which may be suspended or revoked by the state in the exercise of its police power.—The petitioner correctly points out that a license to operate a motor vehicle is not a property right, but a privilege granted by the state, which may be suspended or revoked by the state in the exercise of its police power, in the interest of the public safety and welfare, subject to the procedural due process requirements. This is consistent with our rulings in Pedro v. Provincial Board of Rizal on the license to operate a cockpit, Tan v. Director of Forestry and Oposa v. Factoran on timber licensing agreements, and Surigao Electric Co., Inc. v. Municipality of Surigao on a legislative franchise to operate an electric plant.

Same; R.A. No. 7924 does not grant the MMDA with police power, let alone legislative power, and that all its functions are administrative in nature.—In Metro Manila Development Authority v. Bel-Air Village Association, Inc., we categorically stated that Rep. Act No. 7924 does not grant the MMDA with police power, let alone legislative power, and that all its functions are administrative in nature.

Same; Police Power; Municipal Corporations; Local Government Units; Police power is lodged primarily in the

National Legislature and cannot be exercised by any group or body of individuals not possessing legislative power through the National Legislature may delegate it to the President and administrative boards as well as the lawmaking bodies of municipal corporations or local government units.—We restate here the doctrine in the said decision as it applies to the case at bar: police power, as an inherent attribute of sovereignty, is the power vested by the Constitution in the legislature to make, ordain, and establish all manner of wholesome and reasonable laws, statutes and ordinances, either with penalties or without, not repugnant to the Constitution, as they shall judge to be for the good and welfare of the commonwealth, and for the subjects of the same. Having been lodged primarily in the National Legislature, it cannot be exercised by any group or body of individuals not possessing legislative power. The National Legislature, however, may delegate

178

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Metropolitan Manila Development Authority vs. Garinthis power to the president and administrative boards as well as the lawmaking bodies of municipal corporations or local government units (LGUs). Once delegated, the agents can exercise only such legislative powers as are conferred on them by the national lawmaking body.

Same; Same; Same; Same; Words and Phrases; A local government is a “political subdivision of a nation or state which is constituted by law and has substantial control of local affairs.”—Our Congress delegated police power to the LGUs in the Local Government Code of 1991. A local

government is a “political subdivision of a nation or state which is constituted by law and has substantial control of local affairs.” Local government units are the provinces, cities, municipalities and barangays, which exercise police power through their respective legislative bodies. Metropolitan or Metro Manila is a body composed of several local government units. With the passage of Rep. Act No. 7924 in 1995, Metropolitan Manila was declared as a “special development and administrative region” and the administration of “metro-wide” basic services affecting the region placed under “a development authority” referred to as the MMDA.

Same; Same; Same; Same; Driver’s Licenses; Only where there is a traffic law or regulation validly enacted by the legislature or those agencies to whom legislative powers have been delegated that the MMDA may confiscate and suspend or revoke drivers’ licenses in the exercise of its mandate of transport and traffic management, as well as the administration and implementation of all traffic enforcement operations, traffic engineering services and traffic education programs.—Where there is a traffic law or regulation validly enacted by the legislature or those agencies to whom legislative powers have been delegated (the City of Manila in this case), the petitioner is not precluded—and in fact is duty-bound—to confiscate and suspend or revoke drivers’ licenses in the exercise of its mandate of transport and traffic management, as well as the administration and implementation of all traffic enforcement operations, traffic engineering services and traffic education programs. This is consistent with our ruling in Bel-Air that the MMDA is a development authority created for the purpose of laying down policies and coordinating with the various national government agencies, people’s

organizations, nongovernmental organizations and the private sector, which may enforce, but not enact, ordinances.

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Same; The laudable intentions regarding the creation of the MMDA are limited by its enabling law which the Court can but interpret—MMDA’s efforts must be authorized by a valid law, or ordinance, or regulation arising from a legitimate source.—The MMDA was intended to coordinate services with metro-wide impact that transcend local political boundaries or would entail huge expenditures if provided by the individual LGUs, especially with regard to transport and traffic management, and we are aware of the valiant efforts of the petitioner to untangle the increasingly traffic-snarled roads of Metro Manila. But these laudable intentions are limited by the MMDA’s enabling law, which we can but interpret, and petitioner must be reminded that its efforts in this respect must be authorized by a valid law, or ordinance, or regulation arising from a legitimate source.PETITION for review on certiorari of a decision of the Regional Trial Court of Parañaque City, Br. 260.

The facts are stated in the opinion of the Court. The Solicitor General for MMDA. Dante O. Garin for and in his own behalf.

CHICO-NAZARIO, J.:

At issue in this case is the validity of Section 5(f) of Republic Act No. 7924 creating the Metropolitan Manila Development Authority (MMDA), which authorizes it to

confiscate and suspend or revoke driver’s licenses in the enforcement of traffic laws and regulations.

The issue arose from an incident involving the respondent Dante O. Garin, a lawyer, who was issued a traffic violation receipt (TVR) and his driver’s license confiscated for parking illegally along Gandara Street, Binondo, Manila, on 05 August 1995. The following statements were printed on the TVR:YOU ARE HEREBY DIRECTED TO REPORT TO THE MMDA TRAFFIC OPERATIONS CENTER PORT AREA MANILA AFTER 48 HOURS FROM DATE OF APPREHENSION FOR DISPOSITION/APPROPRIATE ACTION THEREON. CRIMI-

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Metropolitan Manila Development Authority vs. GarinNAL CASE SHALL BE FILED FOR FAILURE TO REDEEM LICENSE AFTER 30 DAYS.

VALID AS TEMPORARY DRIVER’S LICENSE FOR SEVEN DAYS FROM DATE OF APPREHENSION.1Shortly before the expiration of the TVR’s validity, the respondent addressed a letter2 to then MMDA Chairman Prospero Oreta requesting the return of his driver’s license, and expressing his preference for his case to be filed in court.

Receiving no immediate reply, Garin filed the original complaint3 with application for preliminary injunction in Branch 260 of the Regional Trial Court (RTC) of Parañaque, on 12 September 1995, contending that, in the absence of any implementing rules and regulations, Sec. 5(f) of Rep. Act No. 7924 grants the MMDA unbridled discretion to

deprive erring motorists of their licenses, pre-empting a judicial determination of the validity of the deprivation, thereby violating the due process clause of the Constitution. The respondent further contended that the provision violates the constitutional prohibition against undue delegation of legislative authority, allowing as it does the MMDA to fix and impose unspecified—and therefore unlimited - fines and other penalties on erring motorists.

In support of his application for a writ of preliminary injunction, Garin alleged that he suffered and continues to suffer great and irreparable damage because of the deprivation of his license and that, absent any implementing rules from the Metro Manila Council, the TVR and the confiscation of his license have no legal basis.

For its part, the MMDA, represented by the Office of the Solicitor General, pointed out that the powers granted to it by Sec. 5(f) of Rep. Act No. 7924 are limited to the fixing, collection and imposition of fines and penalties for traffic viola-_______________

1 Records, p. 10.2 Id., p. 11.3 Id., p. 1.

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tions, which powers are legislative and executive in nature; the judiciary retains the right to determine the validity of the penalty imposed. It further argued that the doctrine of separation of powers does not preclude “admixture” of the three powers of government in administrative agencies.4

The MMDA also refuted Garin’s allegation that the

Metro Manila Council, the governing board and policy making body of the petitioner, has as yet to formulate the implementing rules for Sec. 5(f) of Rep. Act No. 7924 and directed the court’s attention to MMDA Memorandum Circular No. TT-95-001 dated 15 April 1995. Respondent Garin, however, questioned the validity of MMDA Memorandum Circular No. TT-95-001, as he claims that it was passed by the Metro Manila Council in the absence of a quorum.

Judge Helen Bautista-Ricafort issued a temporary restraining order on 26 September 1995, extending the validity of the TVR as a temporary driver’s license for twenty more days. A preliminary mandatory injunction was granted on 23 October 1995, and the MMDA was directed to return the respondent’s driver’s license.

On 14 August 1997, the trial court rendered the assailed decision5 in favor of the herein respondent and held that:

13. “a.There was indeed no quorum in that First Regular Meeting of the MMDA Council held on March 23,

1995, hence MMDA Memorandum Circular No. TT-95-001, authorizing confiscation of driver’s licenses

upon issuance of a TVR, is void ab initio.14. b.The summary confiscation of a driver’s license

without first giving the driver an opportunity to be heard; depriving him of a property right (driver’s

license) without DUE PROCESS; not filling (sic) in Court the complaint of supposed traffic infraction,

cannot be justified by any legislation (and is) hence unconstitutional.

WHEREFORE, the temporary writ of preliminary injunction is hereby made permanent; th(e) MMDA is directed to return to plain-_______________

4 Memorandum for Defendants, Records, pp. 178-185.5 Id., pp. 187-190, penned by Hon. Helen Bautista-

Ricafort.182

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Metropolitan Manila Development Authority vs. Garintiff his driver’s license; th(e) MMDA is likewise ordered to desist from confiscating driver’s license without first giving the driver the opportunity to be heard in an appropriate proceeding.”In filing this petition,6 the MMDA reiterates and reinforces its argument in the court below and contends that a license to operate a motor vehicle is neither a contract nor a property right, but is a privilege subject to reasonable regulation under the police power in the interest of the public safety and welfare. The petitioner further argues that revocation or suspension of this privilege does not constitute a taking without due process as long as the licensee is given the right to appeal the revocation.

To buttress its argument that a licensee may indeed appeal the taking and the judiciary retains the power to determine the validity of the confiscation, suspension or revocation of the license, the petitioner points out that under the terms of the confiscation, the licensee has three options:

14. 1.To voluntarily pay the imposable fine,15. 2.To protest the apprehension by filing a protest with

the MMDA Adjudication Committee, or16. 3.To request the referral of the TVR to the Public

Prosecutor’s Office.The MMDA likewise argues that Memorandum Circular No. TT-95-001 was validly passed in the presence of a quorum,

and that the lower court’s finding that it had not was based on a “misapprehension of facts,” which the petitioner would have us review. Moreover, it asserts that though the circular is the basis for the issuance of TVRs, the basis for the summary confiscation of licenses is Sec. 5(f) of Rep. Act No. 7924 itself, and that such power is self-executory and does not require the issuance of any implementing regulation or circular._______________

6 Records, pp. 197-225.183


Meanwhile, on 12 August 2004, the MMDA, through its Chairman Bayani Fernando, implemented Memorandum Circular No. 04, Series of 2004, outlining the procedures for the use of the Metropolitan Traffic Ticket (MTT) scheme. Under the circular, erring motorists are issued an MTT, which can be paid at any Metrobank branch. Traffic enforcers may no longer confiscate drivers’ licenses as a matter of course in cases of traffic violations. All motorists with unredeemed TVRs were given seven days from the date of implementation of the new system to pay their fines and redeem their license or vehicle plates.7

It would seem, therefore, that insofar as the absence of a prima facie case to enjoin the petitioner from confiscating drivers’ licenses is concerned, recent events have overtaken the Court’s need to decide this case, which has been rendered moot and academic by the implementation of Memorandum Circular No. 04, Series of 2004.

The petitioner, however, is not precluded from re-implementing Memorandum Circular No. TT-95-001, or any

other scheme, for that matter, that would entail confiscating drivers’ licenses. For the proper implementation, therefore, of the petitioner’s future programs, this Court deems it appropriate to make the following observations:

15. 1.A license to operate a motor vehicle is a privilege that the state may withhold in the exercise of its police

power.The petitioner correctly points out that a license to operate a motor vehicle is not a property right, but a privilege granted by the state, which may be suspended or revoked by the state in the exercise of its police power, in the interest of the public safety and welfare, subject to the procedural due process requirements. This is consistent with our rulings in Pedro v. Provincial Board of Rizal8 on the license to operate a cockpit,_______________

7 Sec. 7, Mem. Circ. No. 04, Series of 2004.8 56 Phil. 123 (1931).

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Metropolitan Manila Development Authority vs. GarinTan v. Director of Forestry9 and Oposa v. Factoran10 on timber licensing agreements, and Surigao Electric Co., Inc. v. Municipality of Surigao11 on a legislative franchise to operate an electric plant.

Petitioner cites a long list of American cases to prove this point, such as State ex. Rel. Sullivan,12 which states in part that, “the legislative power to regulate travel over the highways and thoroughfares of the state for the general welfare is extensive. It may be exercised in any reasonable manner to conserve the safety of travelers and pedestrians.

Since motor vehicles are instruments of potential danger, their registration and the licensing of their operators have been required almost from their first appearance. The right to operate them in public places is not a natural and unrestrained right, but a privilege subject to reasonable regulation, under the police power, in the interest of the public safety and welfare. The power to license imports further power to withhold or to revoke such license upon noncompliance with prescribed conditions.”

Likewise, the petitioner quotes the Pennsylvania Supreme Court in Commonwealth v. Funk,13 to the effect that: “Automobiles are vehicles of great speed and power. The use of them constitutes an element of danger to persons and property upon the highways. Carefully operated, an automobile is still a dangerous instrumentality, but, when operated by careless or incompetent persons, it becomes an engine of destruction. The Legislature, in the exercise of the police power of the commonwealth, not only may, but must, prescribe how and by whom motor vehicles shall be operated on the highways. One of the primary purposes of a system of general regulation of the subject matter, as here by the Vehicle Code,_______________

9 G.R. No. L-24548, 27 October 1983, 125 SCRA 302.10 G.R. No. 101083, 30 July 1993, 224 SCRA 792.11 G.R. No. L-22766, 30 August 1968, 24 SCRA 898.12 63 P. 2d 653, 108 ALR 1156, 1159.13 323 Pa. 390, 186 A. 65 (108 ALR 1161).

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is to insure the competency of the operator of motor

vehicles. Such a general law is manifestly directed to the promotion of public safety and is well within the police power.”

The common thread running through the cited cases is that it is the legislature, in the exercise of police power, which has the power and responsibility to regulate how and by whom motor vehicles may be operated on the state highways.

5.2.The MMDA is not vested with police power.In Metro Manila Development Authority v. Bel-Air Village Association, Inc.,14 we categorically stated that Rep. Act No. 7924 does not grant the MMDA with police power, let alone legislative power, and that all its functions are administrative in nature.

The said case also involved the herein petitioner MMDA which claimed that it had the authority to open a subdivision street owned by the Bel-Air Village Association, Inc. to public traffic because it is an agent of the state endowed with police power in the delivery of basic services in Metro Manila. From this premise, the MMDA argued that there was no need for the City of Makati to enact an ordinance opening Neptune Street to the public.

Tracing the legislative history of Rep. Act No. 7924 creating the MMDA, we concluded that the MMDA is not a local government unit or a public corporation endowed with legislative power, and, unlike its predecessor, the Metro Manila Commission, it has no power to enact ordinances for the welfare of the community. Thus, in the absence of an ordinance from the City of Makati, its own order to open the street was invalid.

We restate here the doctrine in the said decision as it applies to the case at bar: police power, as an inherent attribute

_______________

14 G.R. No. 135962, 27 March 2000, 328 SCRA 836, penned by Justice Reynato S. Puno.

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Metropolitan Manila Development Authority vs. Garinof sovereignty, is the power vested by the Constitution in the legislature to make, ordain, and establish all manner of wholesome and reasonable laws, statutes and ordinances, either with penalties or without, not repugnant to the Constitution, as they shall judge to be for the good and welfare of the commonwealth, and for the subjects of the same.

Having been lodged primarily in the National Legislature, it cannot be exercised by any group or body of individuals not possessing legislative power. The National Legislature, however, may delegate this power to the president and administrative boards as well as the lawmaking bodies of municipal corporations or local government units (LGUs). Once delegated, the agents can exercise only such legislative powers as are conferred on them by the national lawmaking body.

Our Congress delegated police power to the LGUs in the Local Government Code of 1991.15 A local government is a “political subdivision of a nation or state which is constituted by law and has substantial control of local affairs.”16 Local_______________

15 Sec. 16 of Book I of the Local Government Code of 1991 states:

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.

16 Supra, Note 18, p. 844, citing Bernas, The 1987 Constitution of the Philippines, A Commentary, pp. 95-98 [1996], citing UP Law

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government units are the provinces, cities, municipalities and barangays, which exercise police power through their respective legislative bodies.

Metropolitan or Metro Manila is a body composed of several local government units. With the passage of Rep. Act No. 7924 in 1995, Metropolitan Manila was declared as a “special development and administrative region” and the administration of “metro-wide” basic services affecting the region placed under “a development authority” referred to as the MMDA. Thus:. . . [T]he powers of the MMDA are limited to the following

acts: formulation, coordination, regulation, implementation, preparation, management, monitoring, setting of policies, installation of a system and administration. There is no syllable in R.A. No. 7924 that grants the MMDA police power, let alone legislative power. Even the Metro Manila Council has not been delegated any legislative power. Unlike the legislative bodies of the local government units, there is no provision in R.A. No. 7924 that empowers the MMDA or its Council to “enact ordinances, approve resolutions and appropriate funds for the general welfare” of the inhabitants of Metro Manila. The MMDA is, as termed in the charter itself, a “development authority.” It is an agency created for the purpose of laying down policies and coordinating with the various national government agencies, people’s organizations, non-governmental organizations and the private sector for the efficient and expeditious delivery of basic services in the vast metropolitan area. All its functions are administrative in nature and these are actually summed up in the charter itself, viz.:“Sec. 2. Creation of the Metropolitan Manila Development Authority.—x x x.

The MMDA shall perform planning, monitoring and coordinative functions, and in the process exercise regulatory and su-_______________

Center Revision Project, Part II, 712 [1970] citing Sady, “Improvement of Local Government Administration for Development Purpose,” Journal of Local Administration Overseas 135 [July 1962].

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18 SUPREME COURT REPORTS ANNOTATED

8Metropolitan Manila Development Authority vs. Garin

pervisory authority over the delivery of metro-wide services within Metro Manila, without diminution of the autonomy of the local government units concerning purely local matters.”

. . . .Clearly, the MMDA is not a political unit of government.

The power delegated to the MMDA is that given to the Metro Manila Council to promulgate administrative rules and regulations in the implementation of the MMDA’s functions. There is no grant of authority to enact ordinances and regulations for the general welfare of the inhabitants of the metropolis.17 (footnotes omitted, emphasis supplied)Therefore, insofar as Sec. 5(f) of Rep. Act No. 7924 is understood by the lower court and by the petitioner to grant the MMDA the power to confiscate and suspend or revoke drivers’ licenses without need of any other legislative enactment, such is an unauthorized exercise of police power.

4.3.Sec. 5(f) grants the MMDA with the duty to enforce existing traffic rules and regulations.

Section 5 of Rep. Act No. 7924 enumerates the “Functions and Powers of the Metro Manila Development Authority.” The contested clause in Sec. 5(f) states that the petitioner shall “install and administer a single ticketing system, fix, impose and collect fines and penalties for all kinds of violations of traffic rules and regulations, whether moving or nonmoving in nature, and confiscate and suspend or revoke drivers’ licenses in the enforcement of such traffic laws and regulations, the provisions of Rep. Act No. 413618 and P.D. No. 160519 to_______________

17 Ibid., pp. 849-860.18 Entitled “An Act to Compile the Laws Relative to

Land Transportation and Traffic Rules, to Create a Land Transportation Commission and for Other Purposes,” approved on 20 June 1964. Sec. 29 thereof states:Confiscation of driver’s license.—Law enforcement and peace officers duly designated by the Commissioner shall, in

19 Entitled “Granting the Metropolitan Manila Commission Certain Powers Related to Traffic Management and Control in Metropolitan Manila, Providing Penalties, and for Other Purposes,” dated 21 November 1978.SEC. 5.—In case of traffic violations, the driver’s license shall not be confiscated but the erring driver shall be immediately issued a traffic citation ticket prescribed by the Metropolitan Manila Commission which shall state the violation committed, the amount of fine imposed for the violation and an advice that he can make payment to the city or municipal treasurer where the violation was committed or to the Philippine National Bank or Philippine Veteran’s Bank or their branches within seven days from the date of issuance of the citation ticket. (emphasis supplied)

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the contrary notwithstanding,” and that “(f)or this purpose, the Authority shall enforce all traffic laws and regulations in Metro Manila, through its traffic operation center, and may deputize members of the PNP, traffic enforcers of local government units, duly licensed security guards, or members of non-governmental organizations to whom may be delegated certain authority, subject to such conditions and requirements as the Authority may impose.”

Thus, where there is a traffic law or regulation validly enacted by the legislature or those agencies to whom legislative powers have been delegated (the City of Manila in this case), the petitioner is not precluded—and in fact is duty-bound—to confiscate and suspend or revoke drivers’ licenses in the exer-_______________

apprehending any driver for violations of this Act or of any regulations issued pursuant thereto, or of local traffic rules and regulations, confiscate the license of the driver concerned and issue a receipt prescribed and issued by the Commission therefore which shall authorize the driver to operate a motor vehicle for a period not exceeding seventy-two hours from the time and date of issue of said receipt. The period so fixed in the receipt shall not be extended, and shall become invalid thereafter. Failure of the driver to settle his case within fifteen days from the date of apprehension will cause suspension and revocation of his license. (emphasis supplied)

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Metropolitan Manila Development Authority vs. Garincise of its mandate of transport and traffic management, as well as the administration and implementation of all traffic enforcement operations, traffic engineering services and traffic education programs.20

This is consistent with our ruling in Bel-Air that the MMDA is a development authority created for the purpose of laying down policies and coordinating with the various national government agencies, people’s organizations, nongovernmental organizations and the private sector, which

may enforce, but not enact, ordinances.This is also consistent with the fundamental rule of

statutory construction that a statute is to be read in a manner that would breathe life into it, rather than defeat it,21 and is supported by the criteria in cases of this nature that all reasonable doubts should be resolved in favor of the constitutionality of a statute.22_______________

20 Section 3(b), Rep. Act No. 7924.21 Thus, in Briad Agro Development Corporation v.

Dela Serna, (G.R. No. 82805, 29 June 1989, 174 SCRA 524) we upheld the grant of concurrent jurisdiction between the Secretary of Labor or its Regional Directors and the Labor Arbiters to pass upon money claims, among other cases, “the provisions of Article 217 of this Code to the contrary notwithstanding,” as enunciated in Executive Order No. 111. Holding that E.O. 111 was a curative law intended to widen worker’s access to the Government for redress of grievances, we held,” . . . the Executive Order vests in Regional Directors jurisdiction, ‘[t]he provisions of Article 217 of this Code to the contrary notwithstanding,’ it would have rendered such a proviso—and the amendment itself—useless to say that they (Regional Directors) retained the self-same restricted powers, despite such an amendment. It is fundamental that a statute is to be read in a manner that would breathe life into it, rather than defeat it.” (See also Philtread Workers Union v. Confessor, G.R. No. 117169, 12 March 1997, 269 SCRA 393.)

22 In Heirs of Ardona v. Reyes, (G.R. No. 60549, 26 October 1983, 125 SCRA 221) we upheld the constitutionality of Presidential Decree No. 564, the Revised Charter of the Philippine Tourism Au-

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A last word. The MMDA was intended to coordinate services with metro-wide impact that transcend local political_______________

thority, and Proclamation No. 2052 declaring certain municipalities in the province of Cebu as tourist zones. The law granted the Philippine Tourism authority the right to expropriate 282 hectares of land to establish a resort complex notwithstanding the claim that certificates of land transfer and emancipation patents had already been issued to them thereby making the lands expropriated within the coverage of the land reform area under Presidential Decree No. 2, and that the agrarian reform program occupies a higher level in the order of priorities than other State policies like those relating to the health and physical well-being of the people, and that property already taken for public use may not be taken for another public use. We held that, “(t)he petitioners have failed to overcome the burden of anyone trying to strike down a statute or decree whose avowed purpose is the legislative perception of the public good. A statute has in its favor the presumption of validity. All reasonable doubts should be resolved in favor of the constitutionality of a law. The courts will not set aside a law as violative of the Constitution except in a clear case (People v. Vera, 65 Phil. 56). And in the absence of factual findings or evidence to rebut the presumption of validity, the presumption prevails (Ermita-Malate Hotel, etc. v. Mayor of Manila, 20 SCRA 849 [1967]; Morfe v. Mutuc, 22 SCRA 424 [1968]).”

In the same manner, we upheld in Dumlao v. Commission on Elections (G.R. No. L-52245, 22 January 1980, 95 SCRA 392) the first paragraph of Section 4 of Batas Pambansa Bilang 52 providing that any retired elective provincial, city or municipal official, who has received payment of the retirement benefits and who shall have been 65 years of age at the commencement of the term of office to which he seeks to be elected is disqualified to run for the same elective local office from which he has retired. Invoking the need for the emergence of younger blood in local politics, we affirmed that the constitutional guarantee is not violated by a reasonable classification based upon substantial distinctions, where the classification is germane to the purpose of the law and applies to all those belonging to the same class. (See also Tropical Homes, Inc. v. National Housing Authority, G.R. No. L-48672, 31 July 1987, 152 SCRA 540; Peralta v. Commission on Elections, G.R. No. L-47791, 11 March 1978, 82 SCRA 55; People v. Vera, G.R. No. 45685, 65 Phil. 56 [1937].)

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Metropolitan Manila Development Authority vs. Garinboundaries or would entail huge expenditures if provided by the individual LGUs, especially with regard to transport and traffic management,23 and we are aware of the valiant efforts of the petitioner to untangle the increasingly traffic-snarled roads of Metro Manila. But these laudable intentions are limited by the MMDA’s enabling law, which we can but interpret, and petitioner must be reminded that its efforts in this respect must be authorized by a valid law, or ordinance, or regulation arising from a legitimate source.

WHEREFORE, the petition is dismissed.SO ORDERED.

Puno (Chairman), Austria-Martinez, Callejo, Sr. and Tinga, JJ., concur.

Petition dismissed.Notes.—Driving exacts a more than usual toll on the

senses. (Sanitary Steam Laundry, Inc. vs. Court of Appeals, 300 SCRA 20 [1998])

The newly delegated powers to the Local Government Units (LGUs) pertain to the franchising and regulatory powers theretofore 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. (Land Transportation Office vs. City of Butuan, 322 SCRA 805 [2000])

——o0o——

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23 Section 3(b), Republic Act No. 7924.193


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