MMDA VS BEL-AIR VILLAGE ASSOCIATION

Article III, Section 1 (Police Power)

Doctrines:
1. Police power is an inherent attribute of sovereignty.
2. Police power is lodged primarily in the National Legislature which may delegate the
power to the President and administrative boards as well as the lawmaking bodies of
municipal corporations or local government units.
3. There is no syllable in Republic Act No. 7924 that grants the Metro Manila Development
Authority police power, let alone legislative power.

FACTS:
On December 30, 1995, respondent received from petitioner a notice requesting the former to
open its private road, Neptune Street, to public vehicular traffic starting January 2, 1996. On the
same day, respondent was apprised that the perimeter separating the subdivision from
Kalayaan Avenue would be demolished.

Respondent instituted a petition for injunction against petitioner with the RTC, praying for the
issuance of a TRO and preliminary injunction enjoining the opening of Neptune Street and
prohibiting the demolition of the perimeter wall.

The trial court denied issuance of a preliminary injunction.

On appeal, the appellate court (CA) ruled that the MMDA has no authority to order the opening
of Neptune Street, and cause the demolition of its perimeter walls. It held that the authority is
lodged in the City Council of Makati by ordinance.

MMDA averred it has the authority to open Neptune St. because it is an agent of the
Government endowed with police power in the delivery of basic services in Metro Manila. From
the premise of police powers, it follow then that it need not for an ordinance to be enacted
first.

Hence this petition.

ISSUE:
WON MMDA has the mandate to open Neptune Street to public traffic pursuant to its
regulatory and police powers

RULING: IN VIEW WHEREOF, the petition is denied. The Decision and Resolution of the Court of
Appeals in CA-G.R. SP No. 39549 are affirmed. SO ORDERED.

According to SC, Police power is an inherent attribute of sovereignty. Police power is lodged
primarily in the National Legislature, which the latter can delegate to the President and
administrative boards, LGU or other lawmaking bodies.
LGU is a political subdivision for local affairs. Which has a legislative body empowered to enact
ordinances, approved resolutions and appropriate funds for the general welfare of the
province/city/municipality.

The MMDA is, as termed in the charter itself, “development authority.” All its functions are
administrative in nature. The powers of the MMDA are limited to the following acts:
formulation, coordination, regulation, implementation, preparation, management, monitoring,
setting of policies, installation of a system and administration.

There is no syllable in R.A. No. 7924 that grants the MMDA police power, let alone legislative
power. In sum, the MMDA has no power to enact ordinances for the welfare of the community.
It is the LGUs, acting through their respective legislative councils, that possess legislative power
and police power.

The Sangguniang Panlungsod of Makati City did not pass any ordinance or resolution ordering
the opening of Neptune Street, hence, its proposed opening by the MMDA is illegal.

Wherefore, the petition is denied.

MAGTAJAS VS PRYCE PROPERTIES
Article III, Section 1 (Police Power)
DOCTRINE:
1. Tests of a valid ordinance
2. Doctrine of Noscitur a sociis (the meaning of an unclear or ambiguous word should be
determined by considering the words with which it is associated in the context)

FACTS:
In 1992, PAGCOR, created by P.D. 1869, leased a portion of a building belonging to Pryce
Properties Corporatios Inc., in order to expand its operation to Cagayan de Oro City. Various
civic organizations, religious elements, women’s and youth groups, and even the local officials
instantly opposed and denounced the project. The Sangguniang Panlungsod swiftly enacted
two (2) ordinances - Ordinance No. 3353 prohibiting the use of buildings for the operation of a
casino, and Ordinance No. 3375-93 prohibiting the operation of casinos, and providing penalty
for its violation.

Pryce assailed the ordinances before the Court of Appeals, where it was joined by PAGCOR as
intervenor and supplemental petitioner. Court of Appeals declared the ordinances invalid and
issued the writ prayed for to prohibit their enforcement. Reconsideration of this decision was
denied against petitioners. Hence, the petition for review under Rule 45.

ARGUMENT OF PETITIONER:
1. By virtue of Local Government Code (LGC), the Sangguniang Panlungsod is empowered
to enact ordinances to regulate properties and businesses within its territorial limits in
the interest of the general welfare of its inhabitants.
2. When the LGC expressly authorized the local government units to prevent and suppress
gambling and other prohibited games of chance, it meant all forms of gambling without
distinction, including the operation of casinos.

ARGUMENT OF RESPONDENT:
1. Under existing laws, the Sangguniang Panlungsod of the City of Cagayan de Oro does not
have the power and authority to prohibit the establishment and operation of a PAGCOR
gambling casino within the City's territorial limits.
2. P.D. 1869 has not been repealed by the ordinances enacted by the Sanguniang
Panlungsod pursuant to the authority entrusted to it by the Local Government Code.
3. The phrase "gambling and other prohibited games of chance" found in Sec. 458, par. (a),
sub-par. (1) — (v) of R.A. 7160 could only mean "illegal gambling."

ISSUE(S):
1. Whether or not the two ordinances: Ordinance No. 3353 and Ordinance No. 3375-93 as
enacted by the Sangguniang Panlungsod of Cagayan de Oro are valid.
2. Whether or not the phrase “gambling and other prohibited games of chance” found in
Sec. 458, par. (a), sub-par. (1) — (v) of R.A. 7160 could only mean "illegal gambling."
RULING OF THE COURT:
NO. The Supreme Court denied the petition for review, and the challenged decision of the
respondent Court of Appeals is AFFIRMED, with costs against the petitioners.

RATIO DECIDENDI:

1. A long line of decisions has held that to be valid, an ordinance must conform to the
following substantive requirements: 1) It must not contravene the constitution or any
statute. 2) It must not be unfair or oppressive. 3) It must not be partial or
discriminatory. 4) It must not prohibit but may regulate trade. 5) It must be general and
consistent with public policy. 6) It must not be unreasonable.

The rationale of the requirement that the ordinances should not contravene a statute is
obvious. Municipal governments are only agents of the national government, and the local
councils exercise only delegated legislative powers conferred on them by Congress as the
national lawmaking body. It is a heresy to suggest that the local government units can undo the
acts of Congress, from which they have derived their power in the first place, and negate by a
mere ordinance the mandate of the statute.

2. Under the rule of noscitur a sociis, a word or phrase should be interpreted in relation to,
or given the same meaning of, words with which it is associated. Accordingly, we
conclude that since the word "gambling" is associated with "and other prohibited games
of chance," the word should be read as referring to only illegal gambling which, like the
other prohibited games of chance, must be prevented or suppressed.
CRESPO VS PROVINCIAL BOARD
Article III, Section 1 (Due Process)
Doctrine: The court emphasizes the importance of due process, stating that one's employment,
profession, trade, or calling is considered a "property right" that is protected by the
constitutional guarantee of due process of law. The court also highlights that notice and hearing
are fundamental concepts in the legal system, and a fair and enlightened system of justice
would be impossible without these righs.

FACTS:
Petitioner was the elected Municipal Mayor of Cabiao, Nueva Ecija in the local elections of
1967. In January 1971, an administrative complaint was filed against him by private respondent
Pedro T. Wycoco for harassment, abuse of authority and oppression. As required, petitioner
filed a written explanation as to why he should not be dealt with administratively, with the
Provincial Board of Nueva Ecija, in accordance with Section 5, Republic Act No. 5185.

In February 1971, without notifying petitioner or his counsel, public respondent Provincial
Board conducted a hearing of the aforecited administrative case. During the hearing, private
respondent Pedro T. Wycoco was allowed to present evidence, testimonial and documentary,
ex parte, and on the basis of the evidence presented, the respondent Provincial Board passed
Resolution No. 51 preventively suspending petitioner from his office as municipal mayor.

ISSUE:
WON the preventive suspension issued by the Provincial Board is arbitrary and violated the
fundamental principle of due process.

RULING:
Yes, petitioner was denied due process by respondent, Provincial Board. Undoudtedly, the
order of preventive suspension was issued without giving the petitioner a chance to be heard.
In the proceedings held in February 1971, nothing therein can be gathered that, in issuing the
assailed order, the written explanation submitted by petitioner was taken into account. The
assailed order was issued mainly on the basis of the evidence presented ex parte by
respondent Wycoco.

The petition, however, has become moot and academic. Records do not show that in the last
local elections held on 18 January 1988, petitioner was elected to any public office.
PHIL. BLOOMING MILLS EMPLOYEES ORGANIZATION VS PHIL. BLOOMING MILLS CO. INC.,
Article III, Section 1 (Freedom of Speech, Freedom of Assembly)
Doctrine: In the hierarchy of civil liberties, the rights to freedom of expression and of assembly
occupy a preferred position as they are essential to the preservation and vitality of our civil and
political institutions; and such priority "gives these liberties the sanctity and the sanction not
permitting dubious intrusions." The freedoms of speech and of the press as well as of peaceful
assembly and of petition for redress of grievances are absolute when directed against public
officials or "when exercised in relation to our right to choose the men and women by whom we
shall be governed.”

FACTS:
Philippine Blooming Employees Organization (PBMEO) decided to stage a mass demonstration
in front of Malacanang to express their grievances against the alleged abuses of the Pasig
Police. The parties stipulated that the company, after learning the mass demonstration,
informed the union panel that even if the demonstration is an inalienable right granted by the
Constitution, it should not unduly prejudice the normal operation of the company. As such,
they warned the PBMEO representatives that workers who will participate in the
demonstration and the officers present who are the organizers of the demonstration, who shall
fail to report for work the following morning (March 4, 1969) shall be dismissed, because such
failure is a violation of the existing CBA provision on NO LOCKOUT—NO STRIKE article and,
therefore, would be amounting to an illegal strike. However, the Union proceeded to the strike
despite pleas from the Company.

PBMEO contended that they did not violate the existing CBA because they gave the respondent
Company prior notice of the mass demonstration and that the said mass demonstration was a
valid exercise of their constitutional freedom of speech against the alleged abuses of some
Pasig policemen; and that their mass demonstration was not a declaration of strike because it
was not directed against the respondent firm. The lower court decided in favor of the company
and the officers of the PBMEO were found guilty of bargaining in bad faith. Their motion for
reconsideration was subsequently denied by the Court of Industrial Relations for being filed two
days late.

ISSUE:
WON the workers who joined the strike violated the CBA

RULING:
The Supreme Court ruled in favor of the employees. It held that the company’s actions
constituted an unconstitutional restraint on the freedom of expression, freedom of assembly,
and freedom petition for redress of grievances. The court stated that such a demonstration
could not have been legally enjoined by any court as it would be infringing upon the workers’
freedom of expression. It affirms that the rights to freedom of expression, assembly, and
petition for redress of grievances are inalienable rights of every individual, including workers.
While the Bill of Rights protects property rights, human rights such as freedom of expression,
assembly, and petition, are supreme over property rights. Infringement on human right
requires a more stringent criterion for validation, as compared to impairment of property
rights.

The rights of free expression, free assembly and petition, are not only civil rights but also
political rights essential to man's enjoyment of his life, to his happiness and to his full and
complete fulfillment. Thru these freedoms the citizens can participate not merely in the
periodic establishment of the government through their suffrage but also in the administration
of public affairs as well as in the discipline of abusive public officer.

The superiority of these freedoms over property rights is underscored by the fact that a mere
reasonable or rational relation between the means employed by the law and its object or
purpose that the law is neither arbitrary nor discriminatory nor oppressive would suffice to
validate a law which restricts or impairs property rights. On the other hand, a constitutional or
valid infringement of human rights requires a more stringent criterion, namely existence of a
grave and immediate danger of a substantive evil which the State has the right to prevent.
DUNCAN ASSOCIATION OF EMPLOYEES VS GLAXO WELLCOME
Article III, Section 1 (Equal Protection)
Doctrine: It is a legitimate business practice to guard business confidentiality and protect a
competitive position by even-handedly disqualifying from jobs male and female applicants or
employees who are married to a competitor. Consequently, the court ruled than an employer
that discharged an employee who was married to an employee of an active competitor did not
violate the Civil Rights. The Court pointed out that the policy was applied to men and women
equally.

FACTS:
Tecson was hired by Glaxo as a medical representative in 1995. Contract of employment signed
by Tecson stipulates, among others, that he agrees to study and abide by the existing company
rules; to disclose to management any existing future relationship by consanguinity or affinity
with co-employees or employees with competing drug companies and should management find
that such relationship poses a prossible conflict of interest, to resign from the company.

Tecson was initially assigned to market Glaxo's products in the Camarines Sur- Camarines Norte
area and entered into a romantic relationship with Betsy, an employee of Astra, Glaxo's
competition. Before getting married, Tecson's District Manager reminded him several times of
the conflict of interest but marriage took place in Sept. 1998.

In Jan. 1999, Tecson's superiors reminded him that he and Bettsy should decide which one of
them would resign from their jobs. Tecson asked for time to comply with the condition. Unable
to comply with condition, Glaxo transferred Tecson to the Butuan- Surigao City- Agusan del Sur
sales area. After his request against transfer was denied, Tecson brought the matter to Glaxo's
Grievance Committee. Because the parties failed to resolve the issue at the grievance
machinery level, they submitted the matter for voluntary arbitration. The National Conciliation
and Mediation Board (NCMB) rendered its Decision declaring as valid Glaxo’s policy on
relationships between its employees and persons employed with competitor companies, and
affirming Glaxo’s right to transfer Tecson to another sales territory. The Court of Appeals
promulgated its Decision denying the Petition for Review and held that Glaxo’s policy
prohibiting its employees from having personal relationships with employees of competitor
companies is a valid exercise of its management prerogatives.

Hence, this case.

ISSUE:
WON Glaxo’s policy against its employees marrying employees from competitor companies is
valid
RULING:
Yes, Glaxo has a right to guard its trade secrets, manufacturing formulas, marketing strategies,
and other confidential programs and information from competitors. The prohibition against
pesonal or marital relationships with employees of competitor companies upon Glaxo's
employees is reasonable under the circumstances because relationships of that nature might
compromise the interests of the company.

That Glaxo possesses the right to protect its economic interests cannot be denied. No less than
the Constitution recognizes the right of enterprises to adopt and enforce such a policy to
protect its right to reasonable returns on investments and to expansion and growth. Indeed,
while our laws endeavor to give life to the constitutional policy on social justice and the
protection of labor, it does not mean that every labor dispute will be decided in favor of the
workers. The law also recognizes that management has rights which are also entitled to respect
and enforcement in the interest of fair play.

The Court of Appeals also correctly noted that the assailed company policy which forms part of
respondent's Employee Code of Conduct and of its contracts with its employees, such as that
signed by Tecson, was made known to him prior to his employment. Tecson, therefore was
aware of that restriction when he signed his employment contract and when he entered into a
relationship with Bettsy.

On Equal Protection:
It is clear that Glaxo does not impose an absolute prohibition against relationships between its
employees and those of competitor companies. Its employees are free to cultivate relationships
with and marry persons of their own choosing. What the company merely seeks to avoid is a
conflict of interest between the employee and the company that may arise out of such
relationships.
SECRETARY VS JUDGE LANTION
Article III, Section 1 (Due Process vs Duties under a Treaty)

FACTS:
On 13 January 1977, then President Ferdinand E. Marcos issued Presidential Decree 1069
"Prescribing the Procedure for the Extradition of Persons Who Have Committed Crimes in a
Foreign Country".

In November 1994, then Secretary of Justice Franklin M. Drilon, representing the Government
of the Republic of the Philippines, signed in Manila the "Extradition Treaty Between the
Government of the Republic of the Philippines and the Government of the United States of
America. The Philippine Senate ratified the said Treaty.

On June 18, 1999, the Department of Justice received from the Department of Foreign Affairs
U.S Note Verbale No. 0522 containing a request for the extradition of private respondent Mark
Jiminez to the United States. On the same day, petitioner designated and authorized a panel of
attorneys to take charge of and to handle the case. Pending evaluation of the aforestated
extradition documents, Mark Jiminez through counsel, wrote a letter to Justice Secretary
requesting copies of the official extradition request from the U.S Government and that he be
given ample time to comment on the request after he shall have received copies of the
requested papers. However, the petitioner denied the request for the consistency of Article 7
of the RP-US Extradition Treaty stated that the Philippine Government must present the
interests of the United States in any proceedings arising out of a request for extradition.

On 6 August 1999, Jimenez filed with the Regional Trial Court a petition against the Secretary of
Justice, the Secretary of Foreign Affairs, and the Director of the National Bureau of Investigation
for mandamus, certiorari, and to enjoin the Secretary of Foreign Affairs and the Director of the
NBI from performing any act directed to the extradition of Jimenez to the United State, with an
application for the issuance of a temporary restraining order and a writ of preliminary
injunction.

The trial court ruled in favor of Jimenez. The Secretary filed a petition for certiorari before the
Supreme Court.

ISSUE:
WON to uphold a citizen’s basic due process rights or the governments ironclad duties under a
treaty

RULING:
The court held that human rights of person and the rights of the accused guaranteed in the
Constitution should take precedence over treaty rights claimed by a contracting party, the
doctrine of incorporation is applied whenever municipal tribunals are confronted with a
situation where there is a conflict between a rule of the international law and the constitution.
Efforts must first be made in order to harmonize the provisions so as to give effect to both but if
the conflict is irreconcilable, the municipal law must be upheld. The fact that international law
has been made part of the law of the land does not pertain to or imply the primacy of
international law over the municipal law in the municipal sphere. In states where the
constitution is the highest law of the land, both statutes and treaties may be invalidated if they
are in conflict with the constitution.

In the case at bar, private respondent does not only face a clear and present danger of loss of
property or employment but of liberty itself, which may eventually lead to his forcible
banishment to a foreign land. The convergence of petitioners favorable action on the
extradition request and the deprivation of private respondents liberty is easily comprehensible.

We have ruled time and again that this Courts equity jurisdiction, which is aptly described as
"justice outside legality," may be availed of only in the absence of, and never against, statutory
law or judicial pronouncements. The constitutional issue in the case at bar does not even call
for "justice outside legality," since private respondents due process rights, although not
guaranteed by statute or by treaty, are protected by constitutional guarantees. We would not
be true to the organic law of the land if we choose strict construction over guarantees against
the deprivation of liberty. That would not be in keeping with the principles of democracy on
which our Constitution is premised.

Thus, Petitioner is ordered to furnish private respondent copies of the extradition request and
its supporting papers and to grant him a reasonable period within which to file his comment
with supporting evidence.
PEOPLE VS DE LA PIEDRA
Article III, Section 1 (Due Process: Vague Law)
Doctrine: Due process requires that the terms of a penal statute must be sufficiently explicit to
inform those who are subject to it what conduct on their part will render them liable to its
penalties. A criminal statute that "fails to give a person of ordinary intelligence fair notice that
his contemplated conduct is forbidden by the statute," or is so indefinite that "it encourages
arbitrary and erratic arrests and convictions," is void for vagueness. The constitutional vice in a
vague or indefinite statute is the injustice to the accused in placing him on trial for an offense,
the nature of which he is given no fair warning.

FACTS:
Accused-appellant Carol M. dela Piedra was charged of illegal recruitment in large scale by
promising an employment abroad Maria Lourdes Modesto y Gadrino, Nancy Araneta y
Aliwanag and Jennelyn Baez y Timbol, a job to Singapore without having previously obtained
from the Philippine Overseas Employment Administration, a license or authority to engage in
recruitment and overseas placement of workers. In fact said Maria Lourdes Modesto had
already advanced the amount of P2,000.00 to the accused for and in consideration of the
promised employment which did not materialize. Thus causing damage and prejudice to the
latter in the said sum.

Philippine Overseas Employment Agency (POEA), received a telephone call from an unidentified
woman inquiring about the legitimacy of the recruitment conducted by a certain Mrs. Carol
Figueroa Ramos. An entrapment was then planned by the Criminal Investigation Service (CIS)
headed by Capt. Mendoza and successfully arrested the accused-appellant.

Later on, in the course of their investigation, the CIS discovered that Carol Figueroa had many
aliases, among them, Carol Llena and Carol dela Piedra. At the trial, the prosecution presented
five (5) witnesses, and all of them positively testified that the accused offer them a job to
Singapore. The trial found the accused-appellant guilty of beyond reasonable doubt of Illegal
Recruitment committed in a large scale.

Upon appeal, accused questions her conviction for illegal recruitment inlarge scale and assails,
as well, the constitutionality of the law defining and penalizing said crime. First, accused
submits that Article 13 (b) of the Labor Code defining “recruitment and placement” is void for
vagueness and, thus, violates the due process clause.

ISSUES:
(1) WON sec. 13 (b) of P.D. 442, as amended, otherwise known as the illegal recruitment law is
unconstitutional as it violates the due process clause. (2) WON accused was denied equal
protection and therefore should be exculpated

RULING:
1. NO. Article 13 (b) of the Labor Code is not a vague provision. As a rule, a statute or act may be
said to be vague when it lacks comprehensible standards that men of common intelligence
must necessarily guess at its meaning and differ as to its application. It is repugnant to the
Constitution in two respects: (1) it violates due process for failure to accord persons, especially
the parties targeted by it, fair notice of the conduct to avoid; and (2) it leaves law enforcers
unbridled discretion in carrying out its provisions and become an arbitrary flexing of the
Government muscle.

In support of her submission, dela Piedra invokes People vs. Panis,where the Supreme Court
“criticized” the definition of “recruitment and placement.” The Court ruled, however, that her
reliance on the said case was misplaced. The issue in Panis was whether, under the proviso of
Article 13 (b), the crime of illegal recruitment could be committed only “whenever two or more
persons are in any manner promised or offered any employment for a fee.” In this case, the
Court merely bemoaned the lack of records that would help shed light on the meaning of the
proviso. The absence of such records, notwithstanding, the Court was able to arrive at a
reasonable interpretation of the proviso by applying principles in criminal law and drawing from
the language and intent of the law itself. Section 13(b), therefore, is not a “perfectly vague act”
whose obscurity is evident on its face. If at all, the proviso therein is merely couched in
imprecise language that was salvaged by proper construction. It is not void for vagueness.

Dela Piedra further argues that the acts that constitute “recruitment and placement” suffer
from overbreadth since by merely “referring” a person for employment, a person may be
convicted of illegal recruitment.

Section 13 (b) encompasses what appellant apparently considered as customary and harmless
acts such as “labor or employment referral” does not render the law overbroad. Evidently, Dela
Piedra misapprehends concept of overbreadth.

A statute may be said to be overbroad where it operates to inhibit the exercise of individual
freedoms affirmatively guaranteed by the Constitution, such as the freedom of speech or
religion. A generally worded statute, when construed to punish conduct which cannot be
constitutionally punished is unconstitutionally vague to the extent that it fails to give adequate
warning of the boundary between the constitutionally permissible and the constitutionally
impermissible applications of the statute.

2. The Supreme Court held that the argument has no merit.

Dela Piedra invokes the equal protection clause in her defense. She points out that although the
evidence purportedly shows that Jasmine Alejandro handed out application forms and even
received Lourdes Modesto’s payment, appellant was the only one criminally charged.
Alejandro, on the other hand, remained scot-free. From this, she concludes that the
prosecution discriminated against her on grounds of regional origins. Appellant is a Cebuana
while Alejandro is a Zamboangueña, and the alleged crime took place in Zamboanga City.
The prosecution of one guilty person while others equally guilty are not prosecuted, is not, by
itself, a denial of the equal protection of the laws. The unlawful administration by officers of a
statute fair on its face, resulting in its unequal application to those who are entitled to be
treated alike, is not a denial of equal protection unless there is shown to be present in it an
element of intentional or purposeful discrimination. But a discriminatory purpose is not
presumed, there must be a showing of “clear and intentional discrimination.”

In the case at bar, Dela Piedra has failed to show that, in charging her, there was a “clear and
intentional discrimination” on the part of the prosecuting officials. Furthermore, the
presumption is that the prosecuting officers regularly performed their duties, and this
presumption can be overcome only by proof to the contrary, not by mere speculation. As said
earlier,accused has not presented any evidence to overcome this presumption. The mere
allegation that dela Piedra, a Cebuana, was charged with the commission of a crime, while a
Zamboangueña, the guilty party in appellant's eyes, was not, is insufficient to support a
conclusion that the prosecution officers denied appellant equal protection of the laws.
PHILCOMSAT VS ALCUAZ
Article III, Section 1 (Due Process: Procedural)
Doctrine: Aside from statute, the necessity of notice and hearing in an administrative
proceeding depends on the character of the proceeding and the circumstances involved. In so
far as generalization is possible in view of the great variety of administrative proceedings, it
may be stated as a general rule that notice and hearing are not essential to the validity of
administrative action where the administrative body acts in the exercise of executive,
administrative, or legislative functions; but where a public administrative body acts in a judicial
or quasi-judicial matter, and its acts are particular and immediate rather than general and
prospective, the person whose rights or property may be affected by the action is entitled to
notice and hearing.

FACTS:
By virtue of RA 5514, PHILCOMSAT, was granted a franchise providing for services involving
telecommunications since 1967.

Petitioner was exempt from the jurisdiction of the then Public Service Commission, now
respondent NTC. However, pursuant to Executive Order No. 196, petitioner was placed under
the jurisdiction, control and regulation of respondent NTC, including all its facilities and services
and the fixing of rates. Implementing said Executive Order No. 196, respondents required
petitioner to apply for the requisite certificate of public convenience and necessity covering its
facilities and the services it renders, as well as the corresponding authority to charge rates
therefor.

Petitioner filed with respondent NTC an application for authority to continue operating and
maintaining the same facilities it has been continuously operating and maintaining since 1967,
and to charge the current rates applied for in rendering such services. Pending the hearing, it
also applied for a provisional authority so that it can continue to operate and maintain the
above-mentioned facilities. NTC granted the application for a period of 6 months, extended by
six months and another six months thereafter. However, in the same order granting the last
latter extension, the NTC directed the petitioner to charge modified reduced rates through a
reduction of fifteen percent (15%) on the present authorized rates.

ISSUE:
WON the order violates procedural due process for having been issued motu proprio without
prior notice and hearing, and the rate reduction it imposes is unjust, unreasonable and
confiscatory

RULING:
YES. The application of a policy like the fixing of rates as exercised by administrative bodies is
quasi-judicial rather than quasi-legislative: that where the function of the administrative agency
is legislative, notice and hearing are not required, but where an order applies to a named
person, as in the instant case, the function involved is adjudicatory.

The order in question which was issued by respondent Alcuaz no doubt contains all the
attributes of a quasi-judicial adjudication. Foremost is the fact that said order pertains
exclusively to the petitioner and to no other. Further, it is premised on a finding of fact,
although patently superficial, that there is merit in a reduction of some of the rates charged-
based on an initial evaluation of petitioner's financial statements-without affording petitioner
the benefit of an explanation as to what particular aspect or aspects of the financial statements
warranted a corresponding rate reduction. No rationalization was offered nor were the
attending contingencies, if any, discussed, which prompted respondents to impose as much as a
fifteen percent (15%) rate reduction. Notably, petitioner was not even afforded the opportunity
to cross-examine the inspector who issued the report on which respondent NTC based its
questioned order.

While respondents may fix a temporary rate pending final determination of the application of
the petitioner, such rate-fixing order, temporary though it may be, is not exempt from the
statutory procedural requirements of notice and hearing, as well as the requirement of
reasonableness. Assuming that such power is vested in NTC, it may not exercise the same in an
arbitrary and confiscatory manner. The rule is that the power of the State to regulate the
conduct and business of public utilities is limited by the consideration that it is not the owner of
the property of the utility, or clothed with the general power of management incident to
ownership, since the private right of ownership to such property remains and is not to be
destroyed by the regulatory power. The power to regulate is not the power to destroy useful
and harmless enterprises, but is the power to protect, foster, promote, preserve, and control
with due regard for the interest, first and foremost, of the public, then of the utility and of its
patrons. Any regulation, therefore, which operates as an effective confiscation of private
property or constitutes an arbitrary or unreasonable infringement of property rights is void,
because it is repugnant to the constitutional guaranties of due process and equal protection of
the laws. What is a just and reasonable rate is not a question of formula but of sound business
judgment based upon the evidence it is a question of fact calling for the exercise of discretion,
good sense, and a fair, enlightened and independent judgment. In determining whether a rate
is confiscatory, it is essential also to consider the given situation, requirements and
opportunities of the utility. A method often employed in determining reasonableness is the fair
return upon the value of the property to the public utility. Competition is also a very important
factor in determining the reasonableness of rates since a carrier is allowed to make such rates
as are necessary to meet competition.

A cursory perusal of the assailed order reveals that the rate reduction is solely and primarily
based on the initial evaluation made on the financial statements of petitioner, contrary to
respondent NTC's allegation that it has several other sources of information without, however,
divulging such sources. Furthermore, it did not as much as make an attempt to elaborate on
how it arrived at the prescribed rates. It just perfunctorily declared that based on the financial
statements, there is merit for a rate reduction without any elucidation on what implications
and conclusions were necessarily inferred by it from said statements. Nor did it design to
explain how the data reflected in the financial statements influenced its decision to impose a
rate reduction.
VELASCO VS MAYOR VILLEGAS
Article III, Section 1 (Police Power)
Doctrine: The Court has been most liberal in sustaining ordinances based on the general welfare
clause. As far back as U.S. v. Salaveria, 4 a 1918 decision, this Court through Justice Malcolm
made clear the significance and scope of such a clause, which “delegates in statutory form the
police power to a municipality. As above stated, this clause has been given wide application by
municipal authorities and has in its relation to the particular circumstances of the case been
liberally construed by the courts. Such, it is well to really is the progressive view of Philippine
jurisprudence

FACTS:
In the 1980s, the City of Manila passed Ordinance 4964, prohibiting barbershop to conduct
massaging customers in a separate room or in any room in the same building where the
operator of the barbershop and the room of massaging is the same. Petitioner assailed the
validity of the said ordinance. The contention being that it amounts to a deprivation of property
of petitioners-appellants of their means of livelihood without due process of law. Lower Court
dismissed the petition for declaratory relief. Hence, this case.

ISSUE:
WON the ordinance was unconstitutional and therefore an improper exercise of police power

RULING:
The ordinance is constitutional and a valid exercise of police power.

The attack against the validity cannot succeed. As pointed out in the brief of respondents-
appellees, it is a police power measure. The objectives behind its enactment are: “(1) To be able
to impose payment of the license fee for engaging in the business of massage clinic under
Ordinance No. 3659 as amended by Ordinance 4767, an entirely different measure than the
ordinance regulating the business of barbershops and, (2) in order to forestall possible
immorality which might grow out of the construction of separate rooms for massage of
customers.”
CITY OF MANILA VS JUDGE LAGUIO
Article III, Section 1 (Police Power, Equal Protection)
Doctrine: The tests of a valid ordinance are well established. A long line of decisions has held
that for an ordinance to be valid, it must not only be within the corporate powers of the local
government unit to enact and must be passed according to the procedure prescribed by law, it
must also conform to the following substantive requirements: (1) must not contravene the
Constitution or any statute; (2) must not be unfair or oppressive; (3) must not be partial or
discriminatory; (4) must not prohibit but may regulate trade; (5) must be general and consistent
with public policy; and (6) must not be unreasonable.

FACTS:
The private respondent, Malate Tourist Development Corporation (MTOC) is a corporation
engaged in the business of operating hotels, motels, hostels, and lodging houses. It built and
opened Victoria Court in Malate which was licensed as a motel although duly accredited with
the Department of Tourism as a hotel.

On March 30, 1993, City Mayor Alfredo S. Lim approved Ordinance No. 7738 which prohibited
certain forms of amusement, entertainment, services and facilities where women are used as
tools in entertainment and which tend to disturb the community, annoy the inhabitants, and
adversely affect the social and moral welfare of the community. The Ordinance prohibited the
establishment of sauna parlors, massage parlors, karaoke bars, beerhouses, night clubs, day
clubs, cabarets, motels, inns. Owners and operators of the enumerated establishments are
given three months to wind up business operations or transfer to any place outside Ermita-
Malate or convert said businesses to other kinds allowable within the area. The Ordinance also
provided that in case of violation and conviction, the premises of the erring establishment shall
be closed and padlocked permanently.

In June 1993, MTOC filed a Petition with the lower court, praying that the Ordinance, insofar as
it included motels and inns as among its prohibited establishments, be declared invalid and
unconstitutional for several reasons but mainly because it is not a valid exercise of police power
and it constitutes a denial of equal protection under the law.

Judge Laguio ruled for the petitioners. Hence the case was elevated to the Supreme Court.

ISSUE:
WON the Ordinance is constitutional

RULING:
SC held that the ordinance is unconstitutional for several reasons.
The Ordinance infringes the Due Process Clause. The purpose of the guaranty is to prevent
governmental encroachment against the life, liberty and property of individuals; to secure the
individual from the arbitrary exercise of the powers of the government, unrestrained by the
established principles of private rights and distributive justice; to protect property from
confiscation by legislative enactments, from seizure, forfeiture, and destruction without a trial
and conviction by the ordinary mode of judicial procedure; and to secure to all persons equal
and impartial justice and the benefit of the general law. This clause has been interpreted as
imposing two separate limits on government, usually called "procedural due process" and
"substantive due process."

Requisites for the valid exercise of Police Power are not met. To successfully invoke the
exercise of police power, not only must it appear that (1) the interest of the public generally, as
distinguished from those of a particular class, require an interference with private rights, but (2)
the means employed must be reasonably necessary for the accomplishment of the purpose and
not unduly oppressive. The object of the ordinance was the promotion and protection of the
social and moral values of the community. The closing down and transfer of businesses or their
conversion into businesses allowed under the ordinance have no reasonable relation to its
purpose. Otherwise stated, the prohibition of the enumerated establishments will not per se
protect and promote social and moral welfare of the community. It will not itself eradicate
prostitution, adultery, fornication nor will it arrest the spread of sexual disease in Manila.

Means employed are constitutionally infirm. The Ordinance disallows the operation of sauna
parlors, massage parlors, karaoke bars, beerhouses, night clubs, day clubs, super clubs,
discotheques, cabarets, dance halls, motels and inns in the Ermita-Malate area. In Section 3
thereof, owners and/or operators of the enumerated establishments are given three (3)
months from the date of approval of the Ordinance within which "to wind up business
operations or to transfer to any place outside the Ermita-Malate area or convert said
businesses to other kinds of business allowable within the area." Further, it states in Section 4
that in cases of subsequent violations of the provisions of the Ordinance, the "premises of the
erring establishment shall be closed and padlocked permanently."

It is readily apparent that the means employed by the Ordinance for the achievement of its
purposes, the governmental interference itself, infringes on the constitutional guarantees of a
person's fundamental right to liberty and property.

Modality employed is unlawful taking. The ordinance is unreasonable and oppressive as it

substantially divests the respondent of the beneficial use of its property. The ordinance forbids
running of the enumerated businesses in Ermita-Malate area and instructs owners/operators to
wind up their business operations or to transfer outside the area or convert said business into
allowed business. An ordinance which permanently restricts the use of property that it cannot
be used for any reasonable purpose goes beyond regulation and must be recognized as a taking
of the property without just compensation. It is intrusive and violative of the private property
rights of individuals. There are two types of taking: A “possessory” taking and a “regulatory”
taking. The latter occurs when the government’s regulation leaves no reasonable economically
viable use of the property, as in this case.

The Ordinance violates Equal Protection Clause. Equal protection requires that all persons or
things similarly situated should be treated alike, both as to the rights conferred and
responsibilities imposed. Similar subjects, in other words, should not be treated differently, so
as to give undue favor to some. Legislative bodies are allowed to classify the subjects of
legislation provided the classification is reasonable. To be valid, it must conform to the
following requirements: (1)It must be based on substantial distinction; (2)It must be germane to
the purpose of the law; (3)It must not be limited to existing conditions only; and (4)It must
apply equally to all members of the class. In the Court’s view, there are no substantial
distinction between motels, inns, pension houses, hotels, lodging houses or other similar
establishments. By definition, all are commercial establishments providing lodging and usually
meals and other services for the public. No reason exists for prohibiting motels and inns but not
pension houses, hotels, lodging houses or other similar establishments. The Court likewise
cannot see the logic for prohibiting the business and operation of motels in the Ermita-Malate
area but not outside this area. A noxious establishment does not become any less noxious if
located outside the area.

The Ordinance is repugnant to general laws, thus it is ultra vires. The ordinance is in
contravention of the Revised Administrative Code as the Code merely empowers the local
government units to regulate, and not prohibit, the establishments enumerated. Not only that,
it likewise runs counter to the provisions of P.D. 499. The P.D. Had already converted the
residential Ermita-Malate area into a commercial area. The decree allowed the establishment
and operation of all kinds of commercial establishments.

Conclusion. All considered, the Ordinance invades fundamental personal and property rights
and impairs personal privileges. It is constitutionally infirm. The Ordinance contravenes
statutes; it is discriminatory and unreasonable in its operation; it is not sufficiently detailed and
explicit that abuses may attend the enforcement of its sanctions. And not to be forgotten, the
City Council under the Code had no power to enact the Ordinance and is therefore ultra vires,
null and void.

Concededly, the challenged Ordinance was enacted with the best of motives and shares the
concern of the public for the cleansing of the Ermita-Malate area of its social sins. Police power
legislation of such character deserves the full endorsement of the judiciary we reiterate our
support for it. But inspite of its virtuous aims, the enactment of the Ordinance has no statutory
or constitutional authority to stand on. Local legislative bodies, in this case, the City Council,
cannot prohibit the operation of the enumerated establishments under Section 1 thereof or
order their transfer or conversion without infringing the constitutional guarantees of due
process and equal protection of laws not even under the guise of police power.
PEOPLE VS CAYAT
Article III, Section 1 (Equal Protection)
Doctrine: Protection of laws is not violated by a legislation based on reasonable classification.
The classification to be reasonable, (1) must rest on substantial distinctions; (2) must be
germane to the purposes of the law; (3) must not be limited to existing conditions only; (4) must
apply equally to all members of the same class.

FACTS:
In 1937, there existed a law, Act No. 1639 otherwise known as AN ACT TO PROHIBIT THE SALE,
GIFT, OR OTHER DISPOSAL OF ANY INTOXICATING LIQUOR, OTHER THAN THE SO-CALLED
NATIVE WINES AND LIQUORS, TO ANY MEMBER OF A NON-CHRISTIAN TRIBE WITHIN THE
MEANING OF ACT NUMBERED THIRTEEN HUNDRED AND NINETY-SEVEN, AND TO PROHIBIT THE
USE OF SUCH LIQUOR BY ANY MEMBER OF SUCH A TRIBE.

Cayat, a native of the Cordillera, was caught with an A-1-1 gin in violation of said Act. He was
then charged and was eventually sentenced to pay fine with subsidiary imprisonment in case of
insolvency. Cayat admitted his guilt but he challenged the constitutionality of the said Act. He
averred, among others, that it violated his right to equal protection afforded by the
constitution. He argued that the law treats non-Christian tribes with discrimination or “mark
them as inferior or less capable race and less entitled”; that the law was an invalid classification
between native non-Christians and Christians.

ISSUE:
WON Act No. 1639 violates the equal protection clause

RULING:
No, the Act No. 1639 is not violative of the equal protection clause.

Equal protection of the laws is not violated by a legislation based on reasonable classifications.
The classification to be reasonable, (1) must rest on substantial distinctions; (2) must be
germane to the purposes of the law; (3) must not be limited to existing conditions only; (4)
must apply equally to all members of the same class. Act No. 1639 satisfies these requirements.
The classification rests on real and substantial, not merely imaginary or whimsical, distinctions.
It is not based upon "accident of birth or parentage," as counsel to the appellant asserts, but
upon the degree of civilization and culture.

On the first requisite, the classification rests on real and substantial distinctions. The non-
Christian tribes refer not to the religious belief, but in a way to the geographical and more
directly to the natives of the Philippines of a low grade of civilization. Second, That it is germane
to the purposes of law cannot be doubted. The prohibition "to buy, receive, have in his
possession, or drink any ardent spirits, ale, beer, wine, or intoxicating liquors of any kind, other
than the so-called native wines and liquors which the members of such tribes have been
accustomed themselves to make prior to the passage of this Act.," is unquestionably designed
to insure peace and order in and among the non-Christian tribes. It has been the sad experience
of the past, as the observations of the lower court disclose, that the free use of highly
intoxicating liquors by the non-Christian tribes have often resulted in lawlessness and crimes,
thereby hampering the efforts of the government to raise their standard of life and civilization.
Third, the said act is intended to apply for all times as long as the conditions exist. The Act was
not predicated, as counsel for appellant asserts, upon the assumption that the non-Christians
are "impermeable to any civilizing influence." On the contrary, the Legislature understood that
the civilization of a people is a slow process and that hand in hand with it must go measures of
protection and security. Fourth, that the Act applies equally to all members of the class is
evident from a perusal thereof. That it may be unfair in its operation against a certain number
non-Christians by reason of their degree of culture, is not an argument against the equality of
its application.

Appellants contends that that provision of the law empowering any police officer or other duly
authorized agent of the government to seize and forthwith destroy any prohibited liquors
found unlawfully in the possession of any member of the non-Christian tribes is violative of the
due process of law provided in the Constitution. But this provision is not involved in the case at
bar. Besides, to constitute due process of law, notice and hearing are not always necessary. This
rule is especially true where much must be left to the discretion of the administrative officials in
applying a law to particular cases. Due process of law means simply: (1) that there shall be a law
prescribed in harmony with the general powers of the legislative department of the
government; (2) that it shall be reasonable in its operation; (3) that it shall be enforced
according to the regular methods of procedure prescribed; and (4) that it shall be applicable
alike to all citizens of the state or to all of the class.

Neither is the Act an improper exercise of the police power of the state. It has been said that
the police power is the most insistent and least limitable of all powers of the government. It has
been aptly described as a power co-extensive with self-protection and constitutes the law of
overruling necessity. Any measure intended to promote the health, peace, morals, education
and good order of the people or to increase the industries of the state, develop its resources
and add to its wealth and prosperity, is a legitimate exercise of the police power, unless shown
to be whimsical or capricious as to unduly interfere with the rights of an individual, the same
must be upheld.