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LIM VS.

COURT OF APPEALS
G.R. No. 111397,August 12, 2002
CARPIO, J.:
FACTS:
On Dec. 7, 1992, Bistro Pigale, Inc. filed before the trial court a petition for mandamus and
prohibition against Mayor Lim of Manila because the policemen under his instructions inspected and
investigated its license as well as the work permits and health certificates of its staff. This resulted to the
stoppage of work in Bistros night club (New Bangkok Club) and restaurant (Exotic Garden Restaurant)
operations. Mayor Lim also refused to accept its application for a business license as well as the work
permit applications of the staff members for the year 1993.
Acting on Bistros application for injunctive relief, the trial court issued a TRO on Dec. 29, 1992
ordering Lim and/or his agents to refrain from inspecting or interfering in Bistros operations. However,
despite the trial courts order, Lim still issued a closure order and sent policemen to carry this out. Lim
filed a motion to dissolve the injunctive order and to dismiss the case contending that the power of the
mayor to inspect and investigate commercial establishments as well as its staff members is inherent in
the statutory power of the city mayor to issue, suspend or revoke business permits and licenses as
expressly provided in Sec. 11 (I), Art. II of the revised Charter of the City of Manila and in Sec. 455 par. 3
(iv) of the LGC of 1991. The trial court denied Lims motion.
Lim filed with CA a petition for certiorari, prohibition and mandamus against Bistro and Judge
Reyes claiming that the judge committed grave abuse of discretion amounting to lack of jurisdiction in
issuing the writ of prohibitory preliminary injunction in favor of Bistro. CA sustained the trial court
orders and denied Lims motion for reconsideration. Subsequently, Manila City Ordinance No. 7783 took
effect. Lim ordered the WPD command to permanently close down Bistros operation. Hence; this
petition for review on certiorari filed before the SC.
ISSUE:
Whether or not CA erred in upholding the trial courts order.

HELD:
NO. Sec. 11 (I), Art. II of the Revised Chapter of Manila and Sec. 455 (3) (iv) of the LGC clearly
provides that power of the Mayor to issue business licenses and permits necessarily includes the power
to suspend, revoke or even refuse to issue the same. However, the power to suspend or revoke is
expressly premised on the violation of permits and licenses. The law refers to the violation of the
conditions on which the licenses and permits were issued. Similarly, the power to refuse the issuance of
such is premised on the non-compliance with the pre-requisites. The mayor must observe due process in
the exercise of such power, which means that he shall give the applicant or the licensee the duty to be
heard. Even though the mayor has the power to investigate private commercial establishments for the
violations, still, he has no power to order a police raid in the guise of inspection or investigation. Lim has
no authority to close down Bistro without due process of law. In this instant case, Lims exercise of
power violated Bistros property rights that are protected under the due process clause of the
constitution.