QUISUMBING, et al. vs GARCIA, et al.
already given its prior authorization when it passed the appropriation ordinances
Tinga, J.
SUMMARY: COA conducted a financial audit on the Province of Cebu and
found out that several contracts were not supported with a Sangguniang
Panlalawigan resolution authorizing the Provincial Governor to enter into a
contract, as required under Section 22of R.A. No. 7160. Gov Garcia sought
reconsideration of this findings. However, without waiting for its resolution,
filed an action for declaratory relief with the RTC. Gov claimed that the no
prior authorization is required because the expenditures incurred are already
authorized by the appropriation ordinances of the previous year which are
deemed re-enacted. RTC ruled that no prior authorization is required. SC
ruled that the case must be remanded because the action for declaratory relief
is not proper and must be dismissed due to the breach committed prior to the
filing of the action. The trial court should have determined the character of
the questioned contracts, i.e., whether they were mere disbursements
pursuant to the ordinances supposedly passed by the sanggunian, or new
contracts which requires authorization of the provincial board.
DOCTRINE:Disbursement, as used in Sec. 346, should be understood to
pertain to payments for statutory and contractual obligations which the
sanggunian has already authorized thru ordinances enacting the annual
budget and are therefore already subsisting obligations of the local
government unit. Contracts, as used in Sec. 22(c) on the other hand, are
those which bind the local government unit to new obligations, with their
corresponding terms and conditions, for which the local chief executive
needs prior authority from the sanggunian
The question of whether a sanggunian authorization separate from the
appropriation ordinance is required should be resolved depending on the
particular circumstances of the case. Resort to the appropriation ordinance is
necessary in order to determine if there is a provision therein which
specifically covers the expense to be incurred or the contract to be entered
into. Should the appropriation ordinance, for instance, already contain in
sufficient detail the project and cost of a capital outlay such that all that the
local chief executive needs to do after undergoing the requisite public
bidding is to execute the contract, no further authorization is required, the
appropriation ordinance already being sufficient. On the other hand, should
the appropriation ordinance describe the projects in generic terms such as
"infrastructure projects," "inter-municipal waterworks, drainage and
sewerage, flood control, and irrigation systems projects," "reclamation
projects" or "roads and bridges," there is an obvious need for a covering
contract for every specific project that in turn requires approval by the
sanggunian. Specific sanggunian approval may also be required for the
purchase of goods and services which are neither specified in the
appropriation ordinance nor encompassed within the regular personal
services and maintenance operating expenses.
FACTS:
The Commission on Audit (COA) conducted a financial audit on the Province of
Cebu for the period ending December 2004. Its audit team rendered a report,
Part II of which states: "Several contracts in the total amount ofP102,092,841.47
were not supported with a Sangguniang Panlalawigan resolution authorizing
the Provincial Governor to enter into a contract, as required under Section 22 of
R.A. No. 7160." The audit team then recommended that the Governor secure
such sanggunian resolution. Gov Garcia sought reconsideration of the findings
and recommendation of the COA. However, without waiting for the resolution
of the reconsideration sought, she instituted an action for Declaratory Relief
before the RTC of Cebu City. Impleaded as respondents are several COA
officials and the Sanggunian Panlalawigan of Cebu, represented by Vice Mayor
Sanchez.
Alleging that the infrastructure contracts subject of the audit report complied
with the bidding procedures provided under R.A. No. 9184 (Government
Procurement Reform Act) and were entered into pursuant to the general and/or
supplemental appropriation ordinances passed by the Sangguniang
Panlalawigan, Gov. Garcia alleged that a separate authority to enter into such
contracts was no longer necessary.
RTC ruled pursuant to Sections 22(c) in relation to Sections 306 and 346of the
LGC and Section 37 of the Government Procurement Reform Act, the Governor
of Cebu need not secure prior authorization by way of a resolution from the
Sangguniang Panlalawigan of the Province of Cebu before she enters into a
contract involving monetary obligations on the part of the Province of Cebu
when there is a prior appropriation ordinance enacted. It is only when the
contract (entered into by the local chief executive) involves obligations which
are not backed by prior ordinances that the prior authority of the sanggunian
concerned is required. In this case, the Sangguniang Panlalawigan of Cebu had
which authorized the expenditures in the questioned contracts.
The trial court also declared that the Sangguniang Panlalawigan does not have
juridical personality nor is it vested by R.A. No. 7160 with authority to sue and
be sued. The trial court accordingly dismissed the case against respondent
members of the Sangguniang Panlalawigan. On the question of the remedy of
declaratory relief being improper because a breach had already been committed,
the trial court held that the case would ripen into and be treated as an ordinary
civil action.
MR was denied.
On appeal, COA officials maintained that Sections 306 and 346 of the LGC
cannot be considered exceptions to Sec. 22(c). Sec. 346 allegedly refers to
disbursements which must be made in accordance with an appropriation
ordinance without need of approval from the sanggunian concerned. Sec. 306,
on the other hand, refers to the authorization for the effectivity of the budget and
should not be mistaken for the specific authorization by the Sangguniang
Panlalawigan for the local chief executive to enter into contracts under Sec.
22(c). The question that must be resolved by the Court should allegedly be
whether the appropriation ordinance referred to in Sec. 346 in relation to Sec.
306 of R.A. No. 7160 is the same prior authorization required under Sec. 22(c)
of the same law.
The OSG filed a Comment pointing out that the instant petition raises factual
issues warranting its denial. There is an issue on whether there were ordinances
authorizing the expenditures incurred in entering into the questioned contracts.
Sec. 323 of the LGC allows disbursements for salaries and wages of existing
positions, statutory and contractual obligations and essential operating expenses
authorized in the annual and supplemental budgets of the preceding year (which
are deemed reenacted in case the sanggunian concerned fails to pass the
ordinance authorizing the annual appropriations at the beginning of the ensuing
fiscal year). Contractual obligations not included in the preceding year’s annual
and supplemental budgets allegedly require the prior approval or authorization
of the local sanggunian.
Note that two things are settled in this case. First, the Province of Cebu was
operating under a reenacted budget in 2004. Second, Gov. Garcia entered into
contracts on behalf of the province while this reenacted budget was in force.
ISSUE: Is the Provincial Governor required to obtain prior authorization of the
Sanggunian Panlalawigan of Cebu before she can enter into the questioned
contracts?
RULING: The case should be remanded to the trial court. If the contracts
were disbursements then no prior authorization is necessary. However, if
they are new contracts, prior authorization of the Sanggunian is
indispensable
RATIO:
As it clearly appears from the Sec 22 (c) of the LGC, prior authorization by the
sanggunian concerned is required before the local chief executive may enter into
contracts on behalf of the local government unit. Sec. 306 of R.A. No. 7160
merely contains a definition of terms. Read in conjunction with Sec. 346, Sec.
306 authorizes the local chief executive to make disbursements of funds in
accordance with the ordinance authorizing the annual or supplemental
appropriations. The "ordinance" referred to in Sec. 346 pertains to that which
enacts the local government unit’s budget, for which reason no further
authorization from the local council is required, the ordinance functioning, as it
does, as the legislative authorization of the budget.
To construe Sections 306 and 346 of R.A. No. 7160 as exceptions to Sec. 22(c)
would render the requirement of prior sanggunian authorization superfluous,
useless and irrelevant. There would be no instance when such prior authorization
would be required, as in contracts involving the disbursement of appropriated
funds. Yet, this is obviously not the effect Congress had in mind when it
required, as a condition to the local chief executive’s representation of the local
government unit in business transactions, the prior authorization of the
sanggunian concerned. The requirement was deliberately added as a measure
of check and balance, to temper the authority of the local chief executive,
and in recognition of the fact that the corporate powers of the local government
unit are wielded as much by its chief executive as by its council. However, the
sanggunian authorization may be in the form of an appropriation ordinance
passed for the year which specifically covers the project, cost or contract to be
entered into by the local government unit.
Sec. 323 of R.A. No. 7160 provides that in case of a reenacted budget, "only the
annual appropriations for salaries and wages of existing positions, statutory and
contractual obligations, and essential operating expenses authorized in the did exist ordinances (authorizing Gov. Garcia to enter into the questioned
annual and supplemental budgets for the preceding year shall be deemed contracts) which rendered the obtention of another authorization from the
reenacted and disbursement of funds shall be in accordance therewith." It should Sangguniang Panlalawigan superfluous. It should also have determined the
be observed that, as indicated by the word "only" preceding the above character of the questioned contracts, i.e., whether they were, as Gov. Garcia
enumeration in Sec. 323, the items for which disbursements may be made under claims, mere disbursements pursuant to the ordinances supposedly passed by the
a reenacted budget are exclusive. Clearly, contractual obligations which were sanggunian or, as COA offcials claim, new contracts which obligate the
not included in the previous year’s annual and supplemental budgets cannot be province without the provincial board’s authority.
disbursed by the local government unit. It follows, too, that new contracts
entered into by the local chief executive require the prior approval of the It cannot be overemphasized that the paramount consideration in the present
sanggunian. controversy is the fact that the Province of Cebu was operating under a re-
enacted budget in 2004, resulting in an altogether different set of rules as
The words "disbursement" and "contract" separately referred to in Sec. 346 and directed by Sec. 323 of R.A. 7160. This Decision, however, should not be so
22(c) of R.A. No. 7160 should be understood in their common signification. construed as to proscribe any and all contracts entered into by the local chief
Disbursement is defined as "To pay out, commonly from a fund. To make executive without formal sanggunian authorization. In cases, for instance, where
payment in settlement of a debt or account payable." “Contract,” on the other the local government unit operates under an annual as opposed to a re-enacted
hand, is defined by our Civil Code as "a meeting of minds between two persons budget, it should be acknowledged that the appropriation passed by the
whereby one binds himself, with respect to the other, to give something or to sanggunian may validly serve as the authorization required under Sec. 22(c) of
render some service." And so, to give life to the obvious intendment of the law R.A. No. 7160. After all, an appropriation is an authorization made by
and to avoid a construction which would render Sec. 22(c) of R.A. No. 7160 ordinance, directing the payment of goods and services from local government
meaningless, disbursement, as used in Sec. 346, should be understood to funds under specified conditions or for specific purposes.
pertain to payments for statutory and contractual obligations which the
sanggunian has already authorized thru ordinances enacting the annual budget
[See 2nd par of doctrine ]
and are therefore already subsisting obligations of the local government unit.
Contracts, as used in Sec. 22(c) on the other hand, are those which bind the
In view of the foregoing, the instant case should be treated as an ordinary civil
local government unit to new obligations, with their corresponding terms and
action requiring for its complete adjudication the confluence of all relevant facts.
conditions, for which the local chief executive needs prior authority from the
Guided by the framework laid out in this Decision, the trial court should receive
sanggunian.
further evidence in order to determine the nature of the questioned contracts
entered into by Gov. Garcia, and the existence of ordinances authorizing her
Sec. 465, Art. 1, Chapter 3 of R.A. No. 7160 states that the provincial governor
acts.
shall "[r]epresent the province in all its business transactions and sign in its
behalf all bonds, contracts, and obligations, and such other documents upon
authority of the Sangguniang Panlalawigan or pursuant to law or ordinances."
Sec. 468, Art. 3 of the same chapter also establishes the sanggunian’s power, as
the province’s legislative body, to authorize the provincial governor to negotiate
and contract loans, lease public buildings held in a proprietary capacity to
private parties, among other things. The foregoing inexorably confirms the
indispensability of the sanggunian’s authorization in the execution of contracts
which bind the local government unit to new obligations. Note should be taken
of the fact that R.A. No. 7160 does not expressly state the form that the
authorization by the sanggunian has to take. Such authorization may be done
by resolution enacted in the same manner prescribed by ordinances, except that
the resolution need not go through a third reading for final consideration unless
the majority of all the members of the sanggunian decides otherwise.

R.A. No. 9184 establishes the law and procedure for public procurement. Sec.
37 thereof explicitly makes the approval of the appropriate authority which, in
the case of local government units, is the sanggunian, the point of reference for
the notice to proceed to be issued to the winning bidder. This provision, rather
than being in conflict with or providing an exception to Sec. 22(c) of R.A. No.
7160, blends seamlessly with the latter and even acknowledges that in the
exercise of the local government unit’s corporate powers, the chief executive
acts merely as an instrumentality of the local council. Read together, the cited
provisions mandate the local chief executive to secure the sanggunian’s
approval before entering into procurement contracts and to transmit the
notice to proceed to the winning bidder not later than seven (7) calendar
days therefrom.

Parenthetically, Gov. Garcia’s petition for declaratory relief should have been
dismissed because it was instituted after the COA had already found her in
violation of Sec. 22(c) of R.A. No. 7160. One of the important requirements for
a petition for declaratory relief under Sec. 1, Rule 63 of the Rules of Court is
that it be filed before breach or violation of a deed, will, contract, other written
instrument, statute, executive order, regulation, ordinance or any other
governmental regulation. Thus, the trial court erred in assuming jurisdiction over
the action despite the fact that the subject thereof had already been breached by
Gov. Garcia prior to the filing of the action. Nonetheless, the conversion of the
petition into an ordinary civil action is warranted under Sec. 6, Rule 63 of the
Rules of Court.

Erroneously, however, the trial court did not treat the COA report as a breach of
the law and proceeded to resolve the issues as it would have in a declaratory
relief action. Thus, it ruled that prior authorization is not required if there exist
ordinances which authorize the local chief executive to enter into contracts. The
problem with this ruling is that it fails to take heed of the incongruent facts
presented by the parties. What the trial court should have done, instead of
deciding the case based merely on the memoranda submitted by the parties, was
to conduct a full-blown trial to thresh out the facts and make an informed and
complete decision. The question which should have been answered by the trial
court, and which it failed to do was whether, during the period in question, there
City of Manila v Teotico (Concepcion, 1968) circumstance would not necessarily detract from its "control or
supervision" by the City of Manila, under Republic Act No. 409.
Facts:  Also, the determination of whether or not P. Burgos Avenue is
under the control or supervision of the City of Manila and whether
 January 27, 1958, at about 8:00 p.m., Genaro N. Teotico fell inside an
the latter is guilty of negligence, in connection with the
uncovered and unlighted catchbasin or manhole on P. Burgos Avenue as
maintenance of said road, which were decided by the Court of
he was stepping down from the curb to board a jeepney.
Appeals in the affirmative, is one of fact, and the findings of said
 Due to the fall, he suffered injuries to his eyes, head and other parts of his
Court, thereon are not subject to review by the Supreme Court.
body. His head hit the rim of the manhole breaking his eyeglasses and
causing broken pieces to pierce his left eyelid. In addition to the lacerated
wound in his left upper eyelid, he suffered contusions on different parts of
his body.
 Several persons came to his assistance. He was brought to the Philippine
General Hospital.
 The injuries and the allergic eruptions caused by anti-tetanus injections
administered to him in the hospital required further medical treatment by a
private practitioner.
 At the time of the incident, he was a practicing public accountant, a
businessman and a professor at University of the East. He also held
positions in various business firms and associations.
 He filed with the CFI Manila a complaint for damages against the City of
Manila, its mayor, city engineer, city health officer, city treasurer and chief
of police.
 CFI Manila dismissed the complaint. CA affirmed this decision, except
insofar as the City of Manila is concerned, which was sentenced to pay
damages to Teotico.

Issues:
1. WON Section 4 of Republic Act No. 409 (Charter of the City of Manila) or
Article 2189 of the Civil Code is applicable to the present case. Civil Code
applies.
2. WON City of Manila can be held liable to Teotico for damages even if the
road was a national road. Yes

Ratio:
1. Although RA No. 409 is a special law as to territorial application,
Civil Code governs liability due to defective streets in particular.
 Section 4 of Republic Act No. 409 reads: "The city shall not be
liable or held for damages or injuries to persons or property arising
from the failure of the Mayor, the Municipal Board, or any other city
officer, to enforce the provisions of this chapter, or any other law or
ordinance, or from negligence of said Mayor, Municipal Board, or
other officers while enforcing or attempting to enforce said
provisions."
 While Article 2189 of the Civil Code of the Philippines provides:
"Provinces, cities and municipalities shall be liable for damages for
the death of, or injuries suffered by, any person by reason of the
defective condition of roads, streets, bridges, public buildings, and
other public works under their control or supervision."
 It is true that, insofar as its territorial application is concerned,
RA No. 409 is a special law and the Civil Code a general legislation;
but, as regards the subject- matter of the provisions above quoted,
Section 4 of Republic Act 409 establishes a general rule regulating
the liability of the City of Manila for "damages or injury to persons
or property. Upon the other hand, Article 2189 of the Civil Code
constitutes a particular prescription making "provinces, cities and
municipalities . . . liable for damages for the death of, or injury
suffered by, any person by reason" — specifically — "of the
defective condition of roads, streets, bridges, public buildings, and
other public works under their control or supervision."
 In other words, said section 4 refers to liability arising from
negligence, in general, regardless of the object thereof, whereas
Article 2189 governs liability due to "defective streets, "in
particular. Since the present action is based upon the alleged
defective condition of a road, said Article 2189 is decisive thereon.

2. The allegation that the accident took place on a national highway was
not made in the Answer of the City. In effect, it admitted that P.
Burgos Avenue was and is under its control and supervision.
 Moreover, this assertion was made, for the first time, in its MR of the
decision of CA. That cannot be set up for the first time on appeal.
 At any rate, under Article 2189, it is not necessary for the liability
therein established to attach that the defective roads or streets
belong to the province, city or municipality from which
responsibility is exacted.
 What said article requires is that the province, city or municipality
have either "control or supervision" over said street or road. Even
if P. Burgos avenue were, therefore, a national highway, this
Municipality of San Fernando La union vs. Firme

FACTS: A passenger jeepney, a sand truck and a dump truck of the

Municipality of San Fernando, La Union collided. Due to the impact, several
passengers of the jeepney including Laureano Baniña Sr. died. The heirs of
Baniña filed a complaint for damages against the owner and driver of the
jeepney, who, in turn, filed a Third Party Complaint against the Municipality
and its dump truck driver, Alfredo Bislig. Municipality filed its answer and
raised the defense of non-suability of the State. After trial, the court ruled in
favor of the plaintiffs and ordered Municipality and Bislig to pay jointly and
severally the heirs of Baniña.

ISSUES: 

1. Are municipal corporations suable?

2. Is the Municipality liable for the torts committed by its employee who was
then engaged in the discharge of governmental functions?

HELD:

1. Municipal corporations, like provinces and cities, are agencies of the State
when they are engaged in governmental functions and therefore should enjoy the
sovereign immunity from suit. Nevertheless, they are subject to suit even in the
performance of such functions because their charter provided that they can sue
and be sued.

2. Municipal corporations are suable because their charters grant them the
competence to sue and be sued. Nevertheless, they are generally not liable for
torts committed by them in the discharge of governmental functions and can be
held answerable only if it can be shown that they were acting in a proprietary
capacity. In permitting such entities to be sued, the State merely gives the
claimant the right to show that the defendant was not acting in its governmental
capacity when the injury was committed or that the case comes under the
exceptions recognized by law. Failing this, the claimant cannot recover.

In this case, the driver of the dump truck of the municipality insists that "he was
on his way to the Naguilian river to get a load of sand and gravel for the repair
of San Fernando's municipal streets." In the absence of any evidence to the
contrary, the regularity of the performance of official duty is presumed. Hence,
the driver of the dump truck was performing duties or tasks pertaining to his
office.

Decision of the lower court modified. Petitioner municipality was absolved of

any liability. 
PRELIMINARY ATTACHMENT

MUNICIPALITY OF HAGONOY vs. DUMDUM, JR.

G.R. No. 168289, March 22, 2010, Peralta,J:p

FACTS: A complaint was filed by Lim Chao against the Municipality of

Hagonoy, Bulacan for collection of sum of money and damages. The complaint
alleged that a contract was entered into by Lim Chao and the Municipality for
the delivery of motor vehicles, which supposedly were needed to carry out
certain developmental undertakings in the municipality. Lim Chao then
delivered to the Municipality of Hagonoy 21 motor vehicles amounting to
P5,820,000.00. However, despite having made several deliveries, the
Municipality allegedly did not heed Lim Chao’s claim for payment. Thus, she
filed a complaint for full payment of the said amount, with interest and damages
and prayed for the issuance of a writ of preliminary attachment against the
Municipality. The trial court issued the Writ of Preliminary Attachment
directing the sheriff "to attach the estate, real and personal properties" of the
Municipality.

The Municipality filed a Motion to Dismiss on the ground that the claim on
which the action had been brought was unenforceable under the statute of
frauds, pointing out that there was no written contract or document that would
evince the supposed agreement they entered into with respondent. It also filed a
Motion to Dissolve and/or Discharge the Writ of Preliminary Attachment
already issued, invoking, among others, immunity of the state from suit. The
Municipality argued that as a municipal corporation, it is immune from suit, and
that its properties are by law exempt from execution and garnishment. Lim Chao
on her part, counters that, the Municipality’s claim of immunity from suit is
negated by the Local Government Code, which vests municipal corporations
with the power to sue and be sued. The Court of Appeals affirmed the trial
court’s order.

ISSUE: W/N the issuance of the Writ of Preliminary Attachment against the
Municipality of Hagonoy is valid.

HELD: No. The universal rule is that where the State gives its consent to be
sued by private parties either by general or special law, it may limit claimant’s
action "only up to the completion of proceedings anterior to the stage of
execution" and that the power of the Courts ends when the judgment is rendered.
Since government funds and properties may not be seized under writs of
execution or garnishment to satisfy such judgments, is based on obvious
considerations of public policy. Disbursements of public funds must be covered
by the corresponding appropriations as required by law. The functions and
public services rendered by the State cannot be allowed to be paralyzed or
disrupted by the diversion of public funds from their legitimate and specific
objects.
G.R. No. 168289               March 22, 2010
THE MUNICIPALITY OF HAGONOY, BULACAN, represented by the
HON. FELIX V. OPLE, Municipal Mayor, and FELIX V. OPLE, in his
personal capacity, Petitioners,  there is merit in private respondent’s position that she, by affidavit, was able to
vs.
HON. SIMEON P. DUMDUM, JR., in his capacity as the Presiding Judge
of the REGIONAL TRIAL COURT, BRANCH 7, CEBU CITY; HON.
CLERK OF COURT & EX-OFFICIO SHERIFF of the REGIONAL
TRIAL COURT of CEBU CITY; HON. CLERK OF COURT & EX-
OFFICIO SHERIFF of the REGIONAL TRIAL COURT of BULACAN
and his DEPUTIES; and EMILY ROSE GO KO LIM CHAO, doing
business under the name and style KD SURPLUS, Respondents.
the diversion of public funds from their legitimate and specific objects. With this
in mind, the Court holds that the writ of preliminary attachment must be
dissolved and, indeed, it must not have been issued in the very first place. While
substantiate the allegation of fraud in the same way that the fraud attributable to
petitioners was sufficiently alleged in the complaint and, hence, the issuance of
the writ would have been justified. Still, the writ of attachment in this case
would only prove to be useless and unnecessary under the premises, since the
property of the municipality may not, in the event that respondent’s claim is
validated, be subjected to writs of execution and garnishment — unless, of
course, there has been a corresponding appropriation provided by law.

PERALTA, J.:
FACTS:
The case stems from a Complaint filed by herein private respondent
Emily Rose Go Ko Lim Chao against herein petitioners, the Municipality of
Hagonoy, Bulacan and its chief executive, Felix V. Ople (Ople) for collection of
a sum of money and damages. It was alleged that sometime in the middle of the
year 2000, respondent, doing business as KD Surplus and as such engaged in
buying and selling surplus trucks, heavy equipment, machinery, spare parts and
related supplies, was contacted by petitioner Ople. Respondent had entered into
an agreement with petitioner municipality through Ople for the delivery of
motor vehicles, which supposedly were needed to carry out certain
developmental undertakings in the municipality. Respondent claimed that
because of Ople’s earnest representation that funds had already been allocated
for the project, she agreed to deliver from her principal place of business in
Cebu City twenty-one motor vehicles whose value totaled P5,820,000.00. To
prove this, she attached to the complaint copies of the bills of lading showing
that the items were consigned, delivered to and received by petitioner
municipality on different dates. However, despite having made several
deliveries, Ople allegedly did not heed respondent’s claim for payment. As of
the filing of the complaint, the total obligation of petitioner had already
totaled P10,026,060.13 exclusive of penalties and damages. Thus, respondent
prayed for full payment of the said amount, with interest at not less than 2% per
month, plus P500,000.00 as damages for business losses, P500,000.00 as
exemplary damages, attorney’s fees of P100,000.00 and the costs of the suit.
Then, the trial court issued an Order granting respondent’s prayer for
a writ of preliminary attachment conditioned upon the posting of a bond
equivalent to the amount of the claim. On March 20, 2003, the trial court issued
the Writ of Preliminary Attachment directing the sheriff "to attach the estate, real
and personal properties" of petitioners.
Petitioners also filed a Motion to Dissolve and/or Discharge the Writ
of Preliminary Attachment Already Issued,invoking immunity of the state from
suit, unenforceability of the contract, and failure to substantiate the allegation of
fraud. The Court However denied such Motion.

ISSUE:
Whether or not the Writ of Preliminary Attachment must be discharged

RULIMG:
Yes. The general rule spelled out in Section 3, Article XVI of the
Constitution is that the state and its political subdivisions may not be sued
without their consent. Otherwise put, they are open to suit but only when they
consent to it. Consent is implied when the government enters into a business
contract, as it then descends to the level of the other contracting party; or it may
be embodied in a general or special law such as that found in Book I, Title I,
Chapter 2, Section 22 of the Local Government Code of 1991, which vests local
government units with certain corporate powers —one of them is the power to
sue and be sued.
Be that as it may, a difference lies between suability and liability.
The suability of the state is conceded and by which liability is ascertained
judicially, the state is at liberty to determine for itself whether to satisfy the
judgment or not. Execution may not issue upon such judgment, because statutes
waiving non-suability do not authorize the seizure of property to satisfy
judgments recovered from the action. These statutes only convey an implication
that the legislature will recognize such judgment as final and make provisions
for its full satisfaction. Thus, where consent to be sued is given by general or
special law, the implication thereof is limited only to the resultant verdict on the
action before execution of the judgment.
The universal rule that where the State gives its consent to be sued by
private parties either by general or special law, it may limit claimant’s action
"only up to the completion of proceedings anterior to the stage of execution" and
that the power of the Courts ends when the judgment is rendered, since
government funds and properties may not be seized under writs of execution or
garnishment to satisfy such judgments, is based on obvious considerations of
public policy. Disbursements of public funds must be covered by the
corresponding appropriations as required by law. The functions and public
services rendered by the State cannot be allowed to be paralyzed or disrupted by
Tano vs Socrates
FACTS: On Dec 15, 1992, the Sangguniang Panglungsod ng Puerto Princesa
enacted an ordinance banning the shipment of all live fish and lobster outside
Puerto Princesa City from January 1, 1993 to January 1, 1998. Subsequently the
Sangguniang Panlalawigan, Provincial Government of Palawan enacted a
resolution prohibiting the catching , gathering, possessing, buying, selling, and
shipment of a several species of live marine coral dwelling aquatic organisms for
5 years, in and coming from Palawan waters.
Petitioners filed a special civil action for certiorari and prohibition, praying that
the court declare the said ordinances and resolutions as unconstitutional on the
ground that the said ordinances deprived them of the due process of law, their
livelihood, and unduly restricted them from the practice of their trade, in
violation of Section 2, Article XII and Sections 2 and 7 of Article XIII of the
1987 Constitution.
ISSUE: Are the challenged ordinances unconstitutional?
HELD: No. The Supreme Court found the petitioners contentions baseless and
held that the challenged ordinances did not suffer from any infirmity, both under
the Constitution and applicable laws. There is absolutely no showing that any of
the petitioners qualifies as a subsistence or marginal fisherman. Besides, Section
2 of Article XII aims primarily not to bestow any right to subsistence fishermen,
but to lay stress on the duty of the State to protect the nation’s marine wealth.
The so-called “preferential right” of subsistence or marginal fishermen to the use
of marine resources is not at all absolute.
In accordance with the Regalian Doctrine, marine resources belong to the state
and pursuant to the first paragraph of Section 2, Article XII of the Constitution,
their “exploration, development and utilization...shall be under the full control
and supervision of the State.
In addition, one of the devolved powers of the LCG on devolution is the
enforcement of fishery laws in municipal waters including the conservation of
mangroves. This necessarily includes the enactment of ordinances to effectively
carry out such fishery laws within the municipal waters. In light of the principles
of decentralization and devolution enshrined in the LGC and the powers granted
therein to LGUs which unquestionably involve the exercise of police power, the
validity of the questioned ordinances cannot be doubted.
TANO v. SOCRATES
Issue: Whether or not the Ordinances in question are unconstitutional
Held: NO
Ratio:
In light then of the principles of decentralization and devolution
enshrined in the LGC and the powers granted therein to local government units
under Section 16 (the General Welfare Clause), and under Sections 149, 447(a)
(1) (vi), 458 (a) (1) (vi) and 468 (a) (1) (vi), which unquestionably involve the
exercise of police power, the validity of the questioned Ordinances cannot be
doubted.
***Sec. 16. General Welfare. — Every local government unit shall exercise the
powers expressly granted, those necessarily implied therefrom, as well as
powers necessary, appropriate, or incidental for its efficient and effective
governance, and those which are essential to the promotion of the general
welfare. Within their respective territorial jurisdictions, local government units
shall ensure and support, among other things, the preservation and enrichment of
culture, promote health and safety, enhance the right of the people to a balanced
ecology, encourage and support the development of appropriate and self-reliant
scientific and technological capabilities, improve public morals, enhance
economic prosperity and social justice, promote full employment among their
residents, maintain peace and order, and preserve the comfort and convenience
of their inhabitants. (emphasis supplied).
It is clear to the Court that both Ordinances have two principal
objectives or purposes: (1) to establish a "closed season" for the species of fish
or aquatic animals covered therein for a period of five years; and (2) to protect
the coral in the marine waters of the City of Puerto Princesa and the Province of
Palawan from further destruction due to illegal fishing activities.
It imposes upon the sangguniang bayan, the sangguniang panlungsod,
and the sangguniang panlalawigan the duty to enact ordinances to "[p]rotect the
environment and impose appropriate penalties for acts which endanger the
environment such as dynamite fishing and other forms of destructive fishing . . .
and such other activities which result in pollution, acceleration of eutrophication
of rivers and lakes or of ecological imbalance."

Facts: The petitioners filed a petition for certiorari and prohibition assailing the The petition is dismissed.
constitutionality of:

(1) Ordinance No. 15-92 entitled: "AN ORDINANCE BANNING THE Sections 2 and 7 of Article XIII provide:
SHIPMENT OF ALL LIVE FISH AND LOBSTER OUTSIDE PUERTO
PRINCESA CITY FROM JANUARY 1, 1993 TO JANUARY 1, 1998 AND
Sec. 2. The promotion of social justice shall include the commitment to create
PROVIDING EXEMPTIONS, PENALTIES AND FOR OTHER PURPOSES
economic opportunities based on freedom of initiative and self-reliance.
THEREOF"
(2) Office Order No. 23, requiring any person engaged or intending to engage in
any business, trade, occupation, calling or profession or having in his possession xxx xxx xxx
any of the articles for which a permit is required to be had, to obtain first a
Mayor’s and authorizing and directing to check or conduct necessary inspections
on cargoes containing live fish and lobster being shipped out from Puerto Sec. 7. The State shall protect the rights of subsistence fishermen, especially of
Princesa and, local communities, to the preferential use of the communal marine and fishing
(3) Resolution No. 33, Ordinance No. 2 entitled: "A RESOLUTION resources, both inland and offshore. It shall provide support to such fishermen
PROHIBITING THE CATCHING, GATHERING, POSSESSING, BUYING, through appropriate technology and research, adequate financial, production,
SELLING AND SHIPMENT OF LIVE MARINE CORAL DWELLING and marketing assistance, and other services. The State shall also protect,
AQUATIC ORGANISMS” develop, and conserve such resources. The protection shall extend to offshore
fishing grounds of subsistence fishermen against foreign intrusion. Fishworkers
shall receive a just share from their labor in the utilization of marine and fishing
The petitioners contend that the said Ordinances deprived them of resources.
due process of law, their livelihood, and unduly restricted them from the practice
of their trade, in violation of Section 2, Article XII and Sections 2 and 7 of
Article XIII of the 1987 Constitution and that the Mayor had the absolute
authority to determine whether or not to issue the permit.

They also claim that it took away their right to earn their livelihood
in lawful ways; and insofar as the Airline Shippers Association are concerned,
they were unduly prevented from pursuing their vocation and entering "into
contracts which are proper, necessary, and essential to carry out their business
endeavors to a successful conclusion

Public respondents Governor Socrates and Members of the

Sangguniang Panlalawigan of Palawan defended the validity of Ordinance No.
2, Series of 1993, as a valid exercise of the Provincial Government's power
under the general welfare clause; they likewise maintained that there was no
violation of the due process and equal protection clauses of the Constitution.
CITY GOVERNMENT OF QC VS ERICTA
Facts: Section 9 of Ordinance No. 6118, S-64 provides that at least 6% of the
total area of the memorial park cemetery shall be set aside for the charity burial
of deceased persons who are paupers and have been residents of Quezon City for
at least 5 years prior to their death. As such, the Quezon City engineer required
the respondent, Himlayang Pilipino Inc, to stop any further selling and/or
transaction of memorial park lots in Quezon City where the owners thereof have
failed to donate the required 6% space intended for paupers burial.
The then Court of First Instance and its judge, Hon. Ericta, declared Section 9 of
Ordinance No. 6118, S-64 null and void.
Petitioners argued that the taking of the respondent’s property is a valid and
reasonable exercise of police power and that the land is taken for a public use as
it is intended for the burial ground of paupers. They further argued that the
Quezon City Council is authorized under its charter, in the exercise of local
police power, ” to make such further ordinances and resolutions not repugnant to
law as may be necessary to carry into effect and discharge the powers and duties
conferred by this Act and such as it shall deem necessary and proper to provide
for the health and safety, promote the prosperity, improve the morals, peace,
good order, comfort and convenience of the city and the inhabitants thereof, and
for the protection of property therein.”
On the otherhand, respondent Himlayang Pilipino, Inc. contended that the taking
or confiscation of property was obvious because the questioned ordinance
permanently restricts the use of the property such that it cannot be used for any
reasonable purpose and deprives the owner of all beneficial use of his property.
Issue: Is Section 9 of the ordinance in question a valid exercise of the police
power?
Held: No. The Sec. 9 of the ordinance is not a valid exercise of the police
power.
Occupying the forefront in the bill of rights is the provision which states that ‘no
person shall be deprived of life, liberty or property without due process of law’
(Art. Ill, Section 1 subparagraph 1, Constitution). On the other hand, there are
three inherent powers of government by which the state interferes with the
property rights, namely-. (1) police power, (2) eminent domain, (3) taxation.
These are said to exist independently of the Constitution as necessary attributes
of sovereignty.
An examination of the Charter of Quezon City (Rep. Act No. 537), does not
reveal any provision that would justify the ordinance in question except the
provision granting police power to the City. Section 9 cannot be justified under
the power granted to Quezon City to tax, fix the license fee, and regulate such
other business, trades, and occupation as may be established or practised in the
City. The power to regulate does not include the power to prohibit or confiscate.
The ordinance in question not only confiscates but also prohibits the operation of
a memorial park cemetery.
Police power is defined by Freund as ‘the power of promoting the public welfare
by restraining and regulating the use of liberty and property’. It is usually
exerted in order to merely regulate the use and enjoyment of property of the
owner. If he is deprived of his property outright, it is not taken for public use but
rather to destroy in order to promote the general welfare. In police power, the
owner does not recover from the government for injury sustained in
consequence thereof.
Under the provisions of municipal charters which are known as the general
welfare clauses, a city, by virtue of its police power, may adopt ordinances to the
peace, safety, health, morals and the best and highest interests of the
municipality. It is a well-settled principle, growing out of the nature of well-
ordered and society, that every holder of property, however absolute and may be
his title, holds it under the implied liability that his use of 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. A property in the state is
held subject to its general regulations, which are necessary to the common good
and general welfare. 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. The state, under the police power, is possessed with plenary power to
deal with all matters relating to the general health, morals, and safety of the
people, so long as it does not contravene any positive inhibition of the organic
law and providing that such power is not exercised in such a manner as to justify
the interference of the courts to prevent positive wrong and oppression.
However, in the case at hand, there is no reasonable relation between the setting
aside of at least six (6) percent of the total area of an private cemeteries for
charity burial grounds of deceased paupers and the promotion of health, morals,
good order, safety, or the general welfare of the people. The ordinance is
actually a taking without compensation of a certain area from a private cemetery
to benefit paupers who are charges of the municipal corporation. Instead of
building or maintaining a public cemetery for this purpose, the city passes the
burden to private cemeteries.
The expropriation without compensation of a portion of private cemeteries is not
covered by Section 12(t) of Republic Act 537, the Revised Charter of Quezon
City which empowers the city council to prohibit the burial of the dead within
the center of population of the city and to provide for their burial in a proper
place subject to the provisions of general law regulating burial grounds and
cemeteries. When the Local Government Code, Batas Pambansa Blg. 337
provides in Section 177 (q) that a Sangguniang panlungsod may “provide for the
burial of the dead in such place and in such manner as prescribed by law or
ordinance” it simply authorizes the city to provide its own city owned land or to
buy or expropriate private properties to construct public cemeteries. This has
been the law and practise in the past. It continues to the present. Expropriation,
however, requires payment of just compensation. The questioned ordinance is
different from laws and regulations requiring owners of subdivisions to set aside
certain areas for streets, parks, playgrounds, and other public facilities from the
land they sell to buyers of subdivision lots. The necessities of public safety,
health, and convenience are very clear from said requirements which are
intended to insure the development of communities with salubrious and
wholesome environments. The beneficiaries of the regulation, in turn, are made
to pay by the subdivision developer when individual lots are sold to home-
owners.
CITY GOVERNMENT OF QUEZON CITY VS. ERICTA
1987 Constitution Art III, Sec. 9: Private property shall not be taken for public
use without just compensation.
FACTS: Section 9 of Ordinance No. 6118, S-64 provides for the appropriation
of 6% of memorial parks for charity burial of the paupers. Himlayang Pilipino,
Inc (HPI), did not appropriate the 6% requirement. Seven years after, the
Quezon City council issued a resolution to stop any further selling and/or
transaction of memorial park lots in Quezon City where the owners thereof have
failed to donate the required 6% space.
ISSUE: Is Section 9 of the ordinance in question a valid exercise of the police
power?
RULING: No. The ordinance is actually a taking without compensation of a
certain area from a private cemetery to benefit paupers who are charges of the
municipal corporation. Instead of building or maintaining a public cemetery for
this purpose, the city passes the burden to private cemeteries. (Thus, even if it is
an eminent domain, it would not have been the proper measure to promote
general welfare in this case)
Police power is usually exercised in the form of mere regulation or restriction in
the use of liberty or property for the promotion of general health, morals, safety
of the people and more so, the general welfare. It does not involve the taking or
confiscation of property with the exception of a few cases where there is a
necessity to confiscate private property in order to destroy it for the purpose of
protecting the peace and order and of promoting the general welfare as for
instance, the confiscation of an illegally possessed article, such as opium and
firearms.
Binay vs. Domingo
Facts: 
Petitioner Municipality of Makati, through its Council, approved Resolution No.
60 which extends P500 burial assistance to bereaved families whose gross
family income does not exceed P2,000.00 a month. The funds are to be taken out
of the unappropriated available funds in the municipal treasury. The Metro
Manila Commission approved the resolution. Thereafter, the municipal secretary
certified a disbursement of P400,000.00 for the implementation of the program.
However, the Commission on Audit disapproved said resolution and the
disbursement of funds for the implementation thereof for the following reasons:
(1) the resolution has no connection to alleged public safety, general welfare,
safety, etc. of the inhabitants of Makati; (2) government funds must be disbursed
for public purposes only; and, (3) it violates the equal protection clause since it
will only benefit a few individuals.

Issues:

1. Whether Resolution No. 60 is a valid exercise of the police power under the
general welfare clause
2. Whether the questioned resolution is for a public purpose
3. Whether the resolution violates the equal protection clause

Held: 

1. The police power is a governmental function, an inherent attribute of

sovereignty, which was born with civilized government. It is founded largely on
the maxims, "Sic utere tuo et ahenum non laedas and "Salus populi est suprema
lex. Its fundamental purpose is securing the general welfare, comfort and
convenience of the people.

Police power is inherent in the state but not in municipal corporations. Before a
municipal corporation may exercise such power, there must be a valid delegation
of such power by the legislature which is the repository of the inherent powers
of the State.

Municipal governments exercise this power under the general welfare clause.

Pursuant thereto they are clothed with authority to "enact such ordinances and
issue such regulations as may be necessary to carry out and discharge the
responsibilities conferred upon it by law, and such as shall be necessary and
proper to provide for the health, safety, comfort and convenience, maintain
peace and order, improve public morals, promote the prosperity and general
welfare of the municipality and the inhabitants thereof, and insure the protection
of property therein.

2. Police power is not capable of an exact definition but has been, purposely,
veiled in general terms to underscore its all comprehensiveness. Its scope, over-
expanding to meet the exigencies of the times, even to anticipate the future
where it could be done, provides enough room for an efficient and flexible
response to conditions and circumstances thus assuring the greatest benefits.

The police power of a municipal corporation is broad, and has been said to be
commensurate with, but not to exceed, the duty to provide for the real needs of
the people in their health, safety, comfort, and convenience as consistently as
may be with private rights. It extends to all the great public needs, and, in a
broad sense includes all legislation and almost every function of the municipal
government. It covers a wide scope of subjects, and, while it is especially
occupied with whatever affects the peace, security, health, morals, and general
welfare of the community, it is not limited thereto, but is broadened to deal with
conditions which exists so as to bring out of them the greatest welfare of the
people by promoting public convenience or general prosperity, and to everything
worthwhile for the preservation of comfort of the inhabitants of the corporation.
Thus, it is deemed inadvisable to attempt to frame any definition which shall
absolutely indicate the limits of police power.

Public purpose is not unconstitutional merely because it incidentally benefits a

limited number of persons. As correctly pointed out by the Office of the
Solicitor General, "the drift is towards social welfare legislation geared towards
state policies to provide adequate social services, the promotion of the general
welfare, social justice as well as human dignity and respect for human
rights." The care for the poor is generally recognized as a public duty. The
support for the poor has long been an accepted exercise of police power in the
promotion of the common good.

3. There is no violation of the equal protection clause. Paupers may be

reasonably classified. Different groups may receive varying treatment. Precious
to the hearts of our legislators, down to our local councilors, is the welfare of the
paupers. Thus, statutes have been passed giving rights and benefits to the
disabled, emancipating the tenant-farmer from the bondage of the soil, housing
the urban poor, etc. Resolution No. 60, re-enacted under Resolution No. 243, of
the Municipality of Makati is a paragon of the continuing program of our
government towards social justice. The Burial Assistance Program is a relief of
pauperism, though not complete. The loss of a member of a family is a painful
experience, and it is more painful for the poor to be financially burdened by such
death. Resolution No. 60 vivifies the very words of the late President Ramon
Magsaysay 'those who have less in life, should have more in law." This decision,
however must not be taken as a precedent, or as an official go-signal for
municipal governments to embark on a philanthropic orgy of inordinate dole-
outs for motives political or otherwise. (Binay vs Domingo, G.R. No. 92389,
September 11, 1991)
Binay vs Domingo
Date: September 11, 1991
Petitioners: Jejomar Binay and Municipality of Makati
Respondents: Eufemio Domingo and commission on Audit
Ponente: Paras
Facts: On September 27, 1988, petitioner Municipality, through its Council,
approved Resolution No. 60 (A resolution to confirm and/or ratify the ongoing
burial assistance program extending P500 to a bereaved family, funds to be
taken out of unappropriated available funds existing in the municipal treasury.)
Metro Manila Commission approved Resolution No. 60. Thereafter, the
municipal secretary certified a disbursement fired of P400,000 for the
implementation of the program.
However, COA disapproved Resolution 60 and disallowed in audit
the disbursement of funds. COA denied the petitioners’ reconsideration as
Resolution 60 has no connection or relation between the objective sought to be
attained and the alleged public safety, general welfare, etc of the inhabitant of
Makati. Also, the Resolution will only benefit a few individuals. Public funds
should only be used for public purposes.
care for the poor is generally recognized as a public duty. The support for the
poor has long been an accepted exercise of police power in the promotion of the
common good.
There is no violation of the equal protection clause in classifying
paupers as subject of legislation. Paupers may be reasonably classified. Different
groups may receive varying treatment. Precious to the hearts of our legislators,
down to our local councilors, is the welfare of the paupers. Thus, statutes have
been passed giving rights and benefits to the disabled, emancipating the tenant-
farmer from the bondage of the soil, housing the urban poor, etc.
Resolution No. 60, re-enacted under Resolution No. 243, of the
Municipality of Makati is a paragon of the continuing program of our
government towards social justice. The Burial Assistance Program is a relief of
pauperism, though not complete. The loss of a member of a family is a painful
experience, and it is more painful for the poor to be financially burdened by such
death. Resolution No. 60 vivifies the very words of the late President Ramon
Magsaysay 'those who have less in life, should have more in law." This decision,
however must not be taken as a precedent, or as an official go-signal for
municipal governments to embark on a philanthropic orgy of inordinate dole-
outs for motives political or otherwise.

Issue: WON Resolution No. 60, re-enacted under Resolution No. 243, of
the Municipality of Makati is a valid exercise of police power under the general
welfare clause\

Held: Yes

Ratio: The police power is a governmental function, an inherent attribute of

sovereignty, which was born with civilized government. It is founded largely on
the maxims, "Sic utere tuo et ahenum non laedas and "Salus populi est suprema
lex Its fundamental purpose is securing the general welfare, comfort and
convenience of the people.
Police power is inherent in the state but not in municipal
corporations). Before a municipal corporation may exercise such power, there
must be a valid delegation of such power by the legislature which is the
repository of the inherent powers of the State. A valid delegation of police
power may arise from express delegation, or be inferred from the mere fact of
the creation of the municipal corporation; and as a general rule, municipal
corporations may exercise police powers within the fair intent and purpose of
their creation which are reasonably proper to give effect to the powers expressly
granted, and statutes conferring powers on public corporations have been
construed as empowering them to do the things essential to the enjoyment of life
and desirable for the safety of the people.
Municipal governments exercise this power under the general welfare
clause: pursuant thereto they are clothed with authority to "enact such
ordinances and issue such regulations as may be necessary to carry out and
discharge the responsibilities conferred upon it by law, and such as shall be
necessary and proper to provide for the health, safety, comfort and convenience,
maintain peace and order, improve public morals, promote the prosperity and
general welfare of the municipality and the inhabitants thereof, and insure the
protection of property therein." And under Section 7 of BP 337, "every local
government unit shall exercise the powers expressly granted, those necessarily
implied therefrom, as well as powers necessary and proper for governance such
as to promote health and safety, enhance prosperity, improve morals, and
maintain peace and order in the local government unit, and preserve the comfort
and convenience of the inhabitants therein."
Police power is the power to prescribe regulations to promote the
health, morals, peace, education, good order or safety and general welfare of the
people. It is the most essential, insistent, and illimitable of powers. In a sense it
is the greatest and most powerful attribute of the government.
The police power of a municipal corporation is broad, and has been
said to be commensurate with, but not to exceed, the duty to provide for the real
needs of the people in their health, safety, comfort, and convenience as
consistently as may be with private rights. It extends to all the great public
needs, and, in a broad sense includes all legislation and almost every function of
the municipal government. It covers a wide scope of subjects, and, while it is
especially occupied with whatever affects the peace, security, health, morals,
and general welfare of the community, it is not limited thereto, but is broadened
to deal with conditions which exists so as to bring out of them the greatest
welfare of the people by promoting public convenience or general prosperity,
and to everything worthwhile for the preservation of comfort of the inhabitants
of the corporation. Thus, it is deemed inadvisable to attempt to frame any
definition which shall absolutely indicate the limits of police power.
COA is not attuned to the changing of the times. Public purpose is
not unconstitutional merely because it incidentally benefits a limited number of
persons. As correctly pointed out by the Office of the Solicitor General, "the
drift is towards social welfare legislation geared towards state policies to provide
adequate social services, the promotion of the general welfare social justice
(Section 10, Ibid) as well as human dignity and respect for human rights. The
G.R. No. 198860               July 23, 2012
ABRAHAM RIMANDO, Petitioner, 
vs.
NAGUILIAN EMISSION TESTING CENTER, INC., represented by its
President, ROSEMARIE LLARENAS and HON. COURT OF
APPEALS, Respondents.
Naguilian Emission Testing Center, Inc., represented by its President, Rosemarie
Llarenas (respondent) filed a petition of mandamus against Abraham P.
Rimando (petitioner), Mayor of Naguilian, La Union at the time that the case
was filed. The petition of mandamus was filed to compel the Rimando to issue a
business permit in favor of Naguilian Emission Testing Center, Inc.
The respondent claimed that its business is being conducted on a parcel of land
which formerly belonged to the national government but later on certified by the
Department of Environment and Natural Resources (DENR) as an alienable and
disposable land of the public domain. The respondent had operated its business
of emission testing on the land from 2005 to 2007. On January 18, 2008, the
respondent filed an application for the renewal of its business permit and paid
the corresponding fees therefor.
The petitioner, however, refused to issue a business permit unless and until the
respondent executes a contract of lease with the Municipality of Naguilian. The
parties did not reach an agreement as regards the stipulations in the proposed
agreement, hence the petition for mandamus.
On May 26, 2009, the RTC denied the petition 3 for lack of merit based on the
ratiocinations that: (a) the Municipality of Naguilian is the declared owner of the
subject parcel of land by virtue of Tax Declaration No. 002-01197; (b) under
Section 6A.01 of the Revenue Code of the Municipality of Naguilian, the
municipality has the right to require the petitioner to sign a contract of lease
because its business operation is being conducted on a real property owned by
the municipality; and (c) a mayor’s duty to issue business permits is
discretionary in nature which may not be enforced by a mandamus writ.
On appeal, the CA held that the appeal was dismissible on the ground of
mootness considering that the period for which the business period was being
sought had already lapsed. Nonetheless, the CA proceeded to resolve the issues
involved in the appeal for academic purposes.
The CA disagreed with the RTC and found that the factual milieu of the case
justifies the issuance of a writ of mandamus. The CA reasoned that the tax
declaration in the name of the municipality was insufficient basis to require the
execution of a contract of lease as a condition sine qua non for the renewal of a
business permit. The CA further observed that Sangguniang Bayan Resolution
No. 2007-81, upon which the municipality anchored its imposition of rental fees,
was void because it failed to comply with the requirements of the Local
Government Code and its Implementing Rules and Regulations.
The CA held that the petitioner may not be held liable for damages since his
action or inaction, for that matter, was done in the performance of official duties
that are legally protected by the presumption of good faith. The CA likewise
stressed that the civil action filed against the petitioner had already become moot
and academic upon the expiration of his term as the mayor of Naguilian, La
Union.
Despite the case being moot, the CA rendered judgment reversing the decision
of the RTC.
ISSUE(S): Whether or not Rimando, as his capacity as mayor, may be
compelled by mandamus to release a business permit in favor of petitioners.
RULING:We agree with the CA that the petition for mandamus has already
become moot and academic owing to the expiration of the period intended to be
covered by the business permit.
An issue or a case becomes moot and academic when it ceases to present a
justiciable controversy so that a determination thereof would be without
practical use and value9 or in the nature of things, cannot be enforced. 10In such
cases, there is no actual substantial relief to which the applicant would be
entitled to and which would be negated by the dismissal of the petition. 11 As a
rule, courts decline jurisdiction over such case, or dismiss it on ground of
mootness.12
The objective of the petition for mandamus to compel the petitioner to grant a
business permit in favor of respondent corporation for the period 2008 to 2009
has already been superseded by the passage of time and the expiration of the
petitioner’s term as mayor. Verily then, the issue as to whether or not the
petitioner, in his capacity as mayor, may be compelled by a writ of mandamus to
release the respondent’s business permit ceased to present a justiciable
controversy such that any ruling thereon would serve no practical value. Should
the writ be issued, the petitioner can no longer abide thereby; also, the effectivity
date of the business permit no longer subsists.
While the CA is not precluded from proceeding to resolve the otherwise moot
appeal of the respondent, we find that the decretal portion of its decision was
erroneously couched.
The CA’s conclusions on the issue of ownership over the subject land and the
invalidity of Sangguniang Bayan Resolution No. 2007-81, aside from being
unsubstantiated by convincing evidence, can no longer be practically utilized in
favor of the petitioner. Thus, the overriding and decisive factor in the final
disposition of the appeal was its mootness and the CA should have dismissed the
same along with the petition for mandamus that spawned it.
More importantly, a mayor cannot be compelled by mandamus to issue a
business permit since the exercise of the same is a delegated police power hence,
discretionary in nature. This was the pronouncement of this Court in Roble
Arrastre, Inc. v. Hon. Villaflor13 where a determination was made on the nature
of the power of a mayor to grant business permits under the Local Government
Code,14 viz:
Central to the resolution of the case at bar is a reading of Section 444(b)(3)(iv)
of the Local Government Code of 1991, which provides, thus:
SEC. 444. The Chief Executive: Powers, Duties, Functions and Compensation.
(b) For efficient, effective and economical governance the purpose of
which is the general welfare of the municipality and its inhabitants
pursuant to Section 16 of this Code, the municipal mayor shall:
3) Initiate and maximize the generation of resources and revenues,
and apply the same to the implementation of development plans,
program objectives and priorities as provided for under Section 18 of
this Code, particularly those resources and revenues programmed for
agro-industrial development and country-wide growth and progress,
and relative thereto, shall:
(iv) Issue licenses and permits and suspend or revoke the same for
any violation of the conditions upon which said licenses or permits
had been issued, pursuant to law or ordinance.
Indeed, as correctly ruled by the RTC, the petition for mandamus filed by the
respondent is incompetent to compel the exercise of a mayor’s discretionary
duty to issue business permits.
WHEREFORE, premises considered, the Decision dated March 30, 2011 of the
Court of Appeals in CA-G.R. SP No. 112152 is hereby SET ASIDE. The
Decision dated May 26, 2009 of the Regional Trial Court of Bauang, La Union
is REINSTATED.
TECHNOLOGY DEVELOPERS, INC v. CA
G.R. No. 94759, Jan. 21, 1991, 201 SCRA
FACTS:
Technology Developers, a corporation engaged in the manufacture and export of
charcoal briquette, received a letter from acting mayor Pablo Cruz: 1) ordering
the full cessation of its plant in Guyong, Sta. Maria, Bulacan until further order,
and 2) requesting its Plant Manager to bring before the office of the mayor its
building permit, mayor's permit, and Region III-Pollution of Environment and
Natural Resources Anti-Pollution Permit.

Technology Developers undertook to comply with the request to produce the
required documents. It sought to secure the Region III-Pollution of Environment
and Natural Resources Anti-Pollution Permit although prior to the operation of
the plant, a Temporary Permit to Operate Air Pollution Installation was issued to
it. Petitioners also sent its representatives to the office of the mayor to secure a
mayor’s permit but were not entertained.
Eventually, the acting mayor ordered that the plant premises be padlocked,
effectively causing the stoppage of operation. This was done without previous
and reasonable notice.
Technology Developers then instituted an action for certiorari, prohibition and
mandamus with preliminary injunction against the acting mayor with Bulacan
RTC, alleging that the closure order was issued in grave abuse of discretion.
The RTC found that the issuance of the writ of preliminary mandatory injunction
was proper, ordering the acting mayor to immediately revoke his closure order
andallow Technology Developers to resume its normal business operations until
the case has been adjudicated on the merits.
Court takes note of the plea of petitioner focusing on its huge investment in this
dollar-earning industry. It must be stressed however, that concomitant with the
need to promote investment and contribute to the growth of the economy is the
equally essential imperative of protecting the health, nay the very lives of the
people, from the deleterious effect of the pollution of the environment.
● The well-known rule is that the matter of issuance of a writ
of preliminaryinjunction is addressed to the sound judicial discretion of the trial
court and its action shall not be disturbed on appeal unless it is demonstrated that
it acted without jurisdiction or in excess of jurisdiction or otherwise, in grave
abuse of its discretion. By the same token the court that issued such
a preliminary relief may recall or dissolve the writ as the circumstances may
warrant.
Petition denied.

Upon MR, the Provincial Prosecutor presented evidence as to the allegation that
"Due to the manufacturing process and nature of raw materials used, the fumes
coming from the factory may contain particulate matters which are hazardous to
the health of the people. As such, the company should cease operating until such
a time that the proper air pollution device is installed and operational."

Reassessing the evidence, the RTC set aside its order granted the writ
ofpreliminary mandatory injunction. The CA denied Technology Developer's
petition for certiorari for lack of merit.

ISSUE:

W/N the acting mayor had a legal ground for ordering the stoppage of
Technology Developer

HELD:

YES. The following circumstances militate against the maintenance of the writ
ofpreliminary injunction sought by petitioner:

1.  No mayor's permit had been secured. While it is true that the matter of
determining whether there is a pollution of the environment that requires control
if not prohibition of the operation of a business is essentially addressed to the
Environmental Management Bureau of the Department of Environment and
Natural Resources, it must be recognized that the mayor of a town has as much
responsibility to protect its inhabitants from pollution, and by virtue of his police
power, he may deny the application for a permit to operate a business or
otherwise close the same unless appropriate measures are taken to control and/or
avoid injury to the health of the residents of the community from the emissions
in the operation of the business.

2.  The Acting Mayor called the attention of petitioner to the pollution emitted
by the fumes of its plant whose offensive odor "not only pollute the air in the
locality but also affect the health of the residents in the area," so that petitioner
was ordered to stop its operation until further orders.

3.  This action of the Acting Mayor was in response to the complaint of the
residents of Barangay Guyong, Sta. Maria, Bulacan, directed to the Provincial
Governor through channels.

4.  The closure order of the Acting Mayor was issued only after an investigation
was made by Marivic Guina who in her report  observed that the fumes emitted
by the plant goes directly to the surrounding houses and that no proper air
pollutiondevice has been installed.

5.  Petitioner failed to produce a building permit from the municipality of Sta.
Maria, but instead presented a building permit issued by an official of Makati on
March 6, 1987.

6.  While petitioner was able to present a temporary permit to operate by the
then National Pollution Control Commission on December 15, 1987, the permit
was good only up to May 25, 1988. Petitioner had not exerted any effort to
extend or validate its permit much less to install any device to control the
pollution and prevent any hazard to the health of the residents of the community.
Technology vs CA (193 scra 147)
Facts:
Technology Developers Inc. is engaged in manufacturing and
exporting charcoal briquette. On February 16, 1989, they received a letter from
respondent Acting Mayor Pablo Cruz, ordering the full cessation of the
operation of the petitioner’s plant in Sta. Maria, Bulacan. The letter also
requested the company to show to the office of the mayor some documents,
including the Building permit, mayor’s permit, and Region III-Pollution of
Environmental and Natural Resources Anti-Pollution Permit.
Since the company failed to comply in bringing the required
documents, respondent Acting Mayor, without notice, caused the padlock of
company’s plant premises, effectively causing stoppage of its operation.
6. While petitioner was able to present a temporary permit to
operate by the then National Pollution Control Commission on
December 15, 1987, the permit was good only up to May 25,
1988. Petitioner had not exerted any effort to extend or validate
its permit much less to install any device to control the
pollution and prevent any hazard to the health of the residents
of the community.
Petitioner takes note of the plea of petitioner focusing on its huge
investment in this dollar-earning industry. It must be stressed however, that
concomitant with the need to promote investment and contribute to the growth
of the economy is the equally essential imperative of protecting the health, nay
the very lives of the people, from the deleterious effect of the pollution of the
environment.

Technology Developers then instituted an action for certiorari,

prohiition, mandamus with preliminary injuction against respondents, alleging
that the closure order was issued in grave abuse of discretion. The lower court
ruled against the company. The CA affirmed the lower court’s ruling.

Issue:

Whether of not the mayor has authority to order the closure of the
plant. YES.

Whether or not the closure order was done with grave abuse of
discretion. NO.

Ruling:

1. No mayor's permit had been secured. While it is true that the

matter of determining whether there is a pollution of the
environment that requires control if not prohibition of the
operation of a business is essentially addressed to the then
National Pollution Control Commission of the Ministry of
Human Settlements, now the Environmental Management
Bureau of the Department of Environment and Natural
Resources, it must be recognized that the mayor of a town has
as much responsibility to protect its inhabitants from pollution,
and by virture of his police power, he may deny the application
for a permit to operate a business or otherwise close the same
unless appropriate measures are taken to control and/or avoid
injury to the health of the residents of the community from the
emissions in the operation of the business.

2. The Acting Mayor, in the letter, called the attention of

petitioner to the pollution emitted by the fumes of its plant
whose offensive odor "not only pollute the air in the locality but
also affect the health of the residents in the area," so that
petitioner was ordered to stop its operation until further orders
and it was required to bring the following:

a. Building permit;

b. Mayor's permit; and

c. Region III-Department of Environment and Natural

Resources Anti-Pollution permit.

3. This action of the Acting Mayor was in response to the

complaint of the residents of Barangay Guyong, Sta. Maria,
Bulacan, directed to the Provincial Governor through channels.

4. The closure order of the Acting Mayor was issued only after an
investigation was made. It found that the fumes emitted by the
plant of petitioner goes directly to the surrounding houses and
that no proper air pollution device has been installed.

5. Petitioner failed to produce a building permit from the

municipality of Sta. Maria, but instead presented a building
permit issued by an official of Makati.
AC Enterprises, Inc. vs. Frabelle Properties Corp.
G.R. No. 166744. November 2, 2006.
SCRA Citation:  506 SCRA 625
DOCTRINE: Private and public nuisance; definition  – The term “nuisance”
is so comprehensive that it has been applied to almost all ways which have
interfered with the rights of the citizens, either in person, property, the
enjoyment of property, or his comfort; A private nuisance is one which violates
only private rights and produces damage to but one or a few persons while a
nuisance is public when it interferes with the exercise of public right by directly
encroaching on public property or by causing a common injury, an unreasonable
interference with the right common to the general public. In this case, the noise
generated by an airconditioning system is considered a private nuisance.
Noise emanating from air-con units not nuisance per se – Noise becomes
actionable only when it passes the limits of reasonable adjustment to the
conditions of the locality and of the needs of the maker to the needs of the
listener; Injury to a particular person in a peculiar position or of especially
sensitive characteristics will not render the noise an actionable nuisance.
Whether or not the noise is a nuisance is an issue to be resolved by the courts.
Test to determine noise as a nuisance – The test is whether rights of property,
of health or of comfort are so injuriously affected by the noise in question that
the sufferer is subjected to a loss [i.e. Actual Physical Discomfort]which goes
beyond the reasonable limit imposed upon him by the condition of living, or of
holding property, in a particular locality in fact devoted to uses which involve
the emission of noise although ordinary care is taken to confine it within
reasonable bounds; or in the vicinity of property of another owner who, though
creating a noise, is acting with reasonable regard for the rights of those affected
by it.
Action to abate private nuisance; incapable of pecuniary estiation  – an action
to abate private nuisance, even wehere the plaintiff asks for damages is one
incapable of pecuniary estimation
FACTS: AC enterprises (Petitioner) is a corporation owns a 10-storey building
in Makati City. Frabelle (Respondent) is a condominium corporation who's
condominium development is located behind petitioner. Respondent complained
of the 'unbearable” noise emanating from the blower of the air-conditioning
units of petitioner.
ISSUES:
(1) Is it a nuisance as to be resolved only by the courts in the due course of
proceedings or a nuisance per se?
(2) Is an action for abatement of a private nuisance, more specifically noise
generated by the blower of an air-conditioning system, even if the plaintiff prays
for damages, one incapable of pecuniary estimation?
(3) What is the determining factor when noise alone is the cause of complaint?
HELD:
(1) It is a nuisance to be resolved only by the courts in the due course of
proceedings; the noise is not a nuisance per se. Noise becomes actionable only
whenn it passes the limits of reasonable adjustment to the conditions of the
locality and of the needs of the maker to the needs of the listener. Injury to a
particular person in a peculiar position or of especially sensitive characteristics
will not render the house an actionable nuisance–– in the conditions, of present
living, noise seems inseparable from the conduct of many necessary
occupations.
(2) Yes, the action is one incapable of pecuniary estimation because the basic
issue is something other than the right to recover a sum of money.
(3) The determining factor is not its intensity or volume; it is that the noise is of
such character as to produce actual physical discomfort and annoyance to a
person of ordinary sensibilities rendering adjacent property less comfortable and
valuable.
AC ENTERPRISES, INC. VS. FRABELLE PROPERTIES CORP.
G.R. NO. 166744. NOVEMBER 2, 2006.
506 SCRA 625
Facts: 
AC enterprises, petitioner herein, is a corporation who owns a 10-
storey building in Makati City. On the other hand, Frabelle, respondent herein, is
a condominium corporation who's condominium development is located behind
petitioner. Respondent complained of the 'unbearable” noise emanating from the
blower of the air-conditioning units of petitioner.
Issues:
WON the “unbearable noise” in the case at bar is a nuisance as to be
resolved only by the courts in the due course of proceedings
HELD:
Yes. It is a nuisance to be resolved only by the courts in the due
course of proceedings; the noise is not a nuisance per se. Noise becomes
actionable only when it passes the limits of reasonable adjustment to the
conditions of the locality and of the needs of the maker to the needs of the
listener. Injury to a particular person in a peculiar position or of especially
sensitive characteristics will not render the house an actionable nuisance–– in
the conditions, of present living, noise seems inseparable from the conduct of
many necessary occupations. The determining factor is not its intensity or
volume; it is that the noise is of such character as to produce actual physical
discomfort and annoyance to a person of ordinary sensibilities rendering
adjacent property less comfortable and valuable.
 demolition did not justify the same and that the legal order of demolition was a
ASILO v. PEOPLE legally impossible provision as there was no legal basis. The present Local
G.R. No. 159017-18 Government Code does not include a provision regarding the abatement of
March 9, 2011 nuisance. This constitutes bad faith and therefore the accused are in violation of
Art III Sec 1: “No person shall be deprived of life, liberty, and property RA 3019 and would also be liable civilly for the damages caused to the Spouses
without due process of the law, nor shall any person be denied equal Bombasi.
protection of the laws” 2. No
FACTS:
The instant case concerns petitions for review on Certiorari on the decision of The death of Mayor Comendador did not extinguish his civil liability as the
the Sandiganbayan in favor of respondents Visitacion and Cesar Bombasi source of his
(Spouses Bombasi) and denying the motions for reconsideration of the obligation was the New Civil Code which provided that the civil action
petitioners Asilo and Comendador . pertained to in the case is independent and will stand despite the Mayor’s death
Private respondents, Spouses Bombasi, filed the Civil Case on August 19, 1994 during the case’s pendency. If the liability arose directly from the crime
in the RTC of San Pablo City Laguna. The mentioned Civil Case for damages committed, then his civil liability could have been extinguished but since it was
with preliminary injunction against the Municipality of Nagcarlan, Laguna, based on the law on human relations it stands alone.
Mayor Demetrio T. Comendador, Paulino S. Asilo, Jr. (Municipal The facts of the case show that the act of demolition without a proper court order
Administrator), and Alberto S. Angeles (Municipal Planning and Development approved/ performed by the petitioners violated the Spouses Bombasi’s right
Coordinator) was initiated after the Spouses Bombasi’s store, located beside the against deprivation of property without due process of law. Art 32 of the
Nagcarlan Market, was demolished for improvements/ reconstruction on the Civil Code expressly provides that in such cases “the aggrieved party has a right
latter which was razed by a fire in 1986. The basis for the said demolition was to commence an entirely separate and distinct civil action for damages, and for
the Sangguniang Bayan Resolution No. 183 which authorized Mayor other relief. Such civil action shall proceed independently of any criminal
Comendador to demolish the store using legal means. prosecution (if the latter be instituted), and may be proved by a preponderance of
The leased property was demolished on October 15, 1993 even when the evidence.”
respondents had a valid lease contract. This lease contract was entered into by
the late mother of private respondent Visitacion, Marciana de Coronado, and the
Municipality of Nagcarlan, Laguna. The contract provided for a lease period of
twenty (20) years beginning on 15 March 1978 until 15 March 1998, and was
extendible for another 20 years. Additionally, the contract stated that should
there be developments made to the adjacent public market, Marciana and her
heirs would be given preferential rights.
Spouses Bombasi included the subsequent occupants of the disputed area,
Spouses Benita and Isagani Coronado and Spouses Alida and Teddy Coroza, in
the said complaint.
Additionally, they filed a criminal complaint against Mayor Comendador, Asilo
and Angeles for violation of Sec. 3(e) of Republic Act No. 3019 otherwise
known as the “Anti-Graft and Corrupt Practices Act” before the Ombudsman.
The complaints (civil and criminal) were consolidated on March 4, 1997.
While the case was pending, Alberto S. Angeles died and the Sandiganbayan
dismissed the case against him. Additionally, Mayor Comendador also died prior
to the final decision.
On April 28, 2003, the Sandiganbayan rendered a decision finding “accused
Demetrio T. Comendador and Paulino S. Asilo, Jr. guilty beyond reasonable
doubt of violation of Sec. 3(e) of Republic Act. No. 3019” and dismissed the
case against the spouses Coronado and spouses Coroza.
Asilo filed a motion for reconsideration on the same day which was
subsequently denied.
The counsel for the late Mayor also filed a motion for reconsideration which
alleged that the latters death extinguished both his criminal and civil liability.
The Sandiganbayan granted the extinction of the criminal liability but denied the
extinction of the civil liability. Consequently, petitions for review on Certiorari
were filed.
ISSUES:
1. Whether the decision of the Sandiganbayan finding the accused guilty of
RA 3019 was correct.
2. Whether the civil liability of Mayor Comendador was extinguished by his
death.

HELD:
1. Yes

RA 3019 provides that:

In addition to acts or omissions of public officers already penalized by existing
law, the following shall constitute corrupt practices of any public officer and are
hereby declared to be unlawful:
xxxx
(e) Causing any undue injury to any party, including the Government, or giving
any private party any unwarranted benefits, advantage or preference in the
discharge of his official, administrative or judicial functions through manifest
partiality, evident bad faith or gross inexcusable negligence. This provision shall
apply to officers and employees of offices or government corporations charged
with the grant of licenses or permits or other concessions.
Since the requisites of the offense are present, there is competent evidence that
the Spouses Bombasi suffered undue injury when the Petitioners (public
officials) performed the demolition of the market stalls with evident bad faith.
Contentions made by the petitioners, that the respondents’ structure is a public
nuisance, had no merit. Findings made by the Supervising Civil Engineer
Wilfredo A. Sambrano of the Laguna District Engineer Office provided that the
said building was not affected by the 1986 fire which razed the Nagcarlan
market. Also, the Sangguniang Bayan Resolutions used as basis for the