Cases 1 - Pub Corp

7/31/2019 Cases 1 - Pub Corp

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PHILIPPINE SOCIETY FOR THE PREVENTION OF CRUELTY TO ANIMALS vs. COA.G.R. No. 169752 September 25, 2007

Facts:

The petitioner was incorporated as a juridical entity over one hundred years ago by virtue of Act No. 1285, enacted on January 19,1905, by the Philippine Commission. The petitioner, at the time it was created, was composed of animal aficionados and animal

propagandists. The objects of the petitioner, as stated in Section 2 of its charter, shall be to enforce laws relating to cruelty inflictedupon animals or the protection of animals in the Philippine Islands, and generally, to do and perform all things which may tend in anyway to alleviate the suffering of animals and promote their welfare.

At the time of the enactment of Act No. 1285, the original Corporation Law, Act No. 1459, was not yet in existence. Act No.1285 antedated both the Corporation Law and the constitution of the Securities and Exchange Commission. Important to note is thatthe nature of the petitioner as a corporate entity is distinguished from the sociedad anonimas under the Spanish Code of Commerce.

For the purpose of enhancing its powers in promoting animal welfare and enforcing laws for the protection of animals, the petitioner was initially imbued under its charter with the power to apprehend violators of animal welfare laws. In addition, the petitioner was to share one-half (1/2) of the fines imposed and collected through its efforts for violations of the laws related thereto.As originally worded, Sections 4 and 5 of Act No. 1285 provide:

Subsequently, however, the power to make arrests as well as the privilege to retain a portion of the fines collected for violationof animal-related laws were recalled by virtue of Commonwealth Act (C.A.) No. 148, which reads, in its entirety, thus:

Immediately thereafter, then President Manuel L. Quezon issued Executive Order (E.O.) No. 63 dated November 12, 1936, portions of which provide:

Whereas, during the first regular session of the National Assembly, Commonwealth Act Numbered One Hundred Forty Eight wasenacted depriving the agents of the Society for the Prevention of Cruelty to Animals of their power to arrest persons who have violatedthe laws prohibiting cruelty to animals thereby correcting a serious defect in one of the laws existing in our statute books .

Whereas, the cruel treatment of animals is an offense against the State, penalized under our statutes, which the Governmentis duty bound to enforce;

By this when the COA was to perform an audit on them they refuse to do so, by the reason that they are a private entity and not under the said commission. On the other hand the COA decided that they are a government entity.

Issue: is the said petitioner a private entity?

Ruling:

First , the Court agrees with the petitioner that the charter test cannot be applied. Essentially, the charter test as it stands today provides:

[T]he test to determine whether a corporation is government owned or controlled, or private in nature is simple. Is it created by itsown charter for the exercise of a public function, or by incorporation under the general corporation law? Those with special chartersare government corporations subject to its provisions , and its employees are under the jurisdiction of the Civil Service Commission,and are compulsory members of the Government Service Insurance System.

The petitioner is correct in stating that the charter test is predicated, at best, on the legal regime established by the 1935 Constitution,Section 7, Article XIII, which states:

Sec. 7. The National Assembly shall not, except by general law, provide for the formation, organization, or regulation of private corporations, unless such corporations are owned or controlled by the Government or any subdivision or instrumentalitythereof.

During the formulation of the 1935 Constitution, the Committee on Franchises recommended the foregoing proscription to prevent the pressure of special interests upon the lawmaking body in the creation of corporations or in the regulation of the same. To permit thelawmaking body by special law to provide for the organization, formation, or regulation of private corporations would be in effect tooffer to it the temptation in many cases to favor certain groups, to the prejudice of others or to the prejudice of the interests of thecountry.

And since the underpinnings of the charter test had been introduced by the 1935 Constitution and not earlier, it follows that the testcannot apply to the petitioner, which was incorporated by virtue of Act No. 1285, enacted on January 19, 1905. Settled is the rule thatlaws in general have no retroactive effect, unless the contrary is provided. All statutes are to be construed as having only a

prospective operation, unless the purpose and intention of the legislature to give them a retrospective effect is expressly declared or isnecessarily implied from the language used. In case of doubt, the doubt must be resolved against the retrospective effect.

There are a few exceptions. Statutes can be given retroactive effect in the following cases: (1) when the law itself so expressly provides; (2) in case of remedial statutes; (3) in case of curative statutes; (4) in case of laws interpreting others; and (5) in case of lawscreating new rights. None of the exceptions is present in the instant case.

As a curative statute, and based on the doctrines so far discussed, C.A. No. 148 has to be given retroactive effect, thereby freeingall doubt as to which class of corporations the petitioner belongs, that is, it is a quasi-public corporation, a kind of private domestic


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corporation, which the Court will further elaborate on under the fourth point.

The general principle of prospectivity of the law likewise applies to Act No. 1459, otherwise known as the Corporation Law, whichhad been enacted by virtue of the plenary powers of the Philippine Commission on March 1, 1906, a little over a year after January 19,1905, the time the petitioner emerged as a juridical entity. Even the Corporation Law respects the rights and powers of juridicalentities organized beforehand

Second , a reading of petitioners charter shows that it is not subject to control or supervision by any agency of the State, unlikegovernment-owned and -controlled corporations. No government representative sits on the board of trustees of the petitioner. Like all

private corporations, the successors of its members are determined voluntarily and solely by the petitioner in accordance with its by-laws, and may exercise those powers generally accorded to private corporations, such as the powers to hold property, to sue and besued, to use a common seal, and so forth. It may adopt by-laws for its internal operations: the petitioner shall be managed or operated

by its officers in accordance with its by-laws in force. The pertinent provisions of the charter provide:

Section 1. Anna L. Ide, Kate S. Wright, John L. Chamberlain, William F. Tucker, Mary S. Fergusson, Amasa S. Crossfield, Spencer Cosby, Sealy B. Rossiter, Richard P. Strong, Jose Robles Lahesa, Josefina R. de Luzuriaga, and such other persons as may beassociated with them in conformity with this act, and their successors, are hereby constituted and created a body politic and corporateat law, under the name and style of The Philippines Society for the Prevention of Cruelty to Animals.

As incorporated by this Act, said society shall have the power to add to its organization such and as many members as it desires, to provide for and choose such officers as it may deem advisable, and in such manner as it may wish, and to remove members as itshall provide.

It shall have the right to sue and be sued, to use a common seal, to receive legacies and donations, to conduct social enterprisesfor the purpose of obtaining funds, to levy dues upon its members and provide for their collection to hold real and personal estatesuch as may be necessary for the accomplishment of the purposes of the society, and to adopt such by-laws for its government as maynot be inconsistent with law or this charter.x x x xSec. 3. The said society shall be operated under the direction of its officers, in accordance with its by-laws in force, and thischarter.

x x x x

Sec. 6. The principal office of the society shall be kept in the city of Manila, and the society shall have full power to locate andestablish branch offices of the society wherever it may deem advisable in the Philippine Islands, such branch offices to be under thesupervision and control of the principal office.

Third . The employees of the petitioner are registered and covered by the Social Security System at the latters initiative, and notthrough the Government Service Insurance System, which should be the case if the employees are considered government employees.This is another indication of petitioners nature as a private entity. Section 1 of Republic Act No. 1161, as amended by Republic Act

No. 8282, otherwise known as the Social Security Act of 1997, defines the employer:

Employer Any person, natural or juridical, domestic or foreign, who carries on in the Philippines any trade, business, industry,undertaking or activity of any kind and uses the services of another person who is under his orders as regards the employment, except the Government and any of its political subdivisions, branches or instrumentalities, including corporations owned or controlled by theGovernment : Provided, That a self-employed person shall be both employee and employer at the same time. (Emphasis supplied)

Fourth . The respondents contend that the petitioner is a body politic because its primary purpose is to secure the protectionand welfare of animals which, in turn, redounds to the public good.

This argument, is, at best, specious. The fact that a certain juridical entity is impressed with public interest does not, by thatcircumstance alone, make the entity a public corporation, inasmuch as a corporation may be private although its charter contains provisions of a public character, incorporated solely for the public good. This class of corporations may be considered quasi-publiccorporations, which are private corporations that render public service, supply public wants, or pursue other eleemosynary objectives.While purposely organized for the gain or benefit of its members, they are required by law to discharge functions for the public

benefit. Examples of these corporations are utility, railroad, warehouse, telegraph, telephone, water supply corporations andtransportation companies. It must be stressed that a quasi-public corporation is a species of private corporations , but the qualifyingfactor is the type of service the former renders to the public: if it performs a public service, then it becomes a quasi-public corporation.

Authorities are of the view that the purpose alone of the corporation cannot be taken as a safe guide, for the fact is that almost allcorporations are nowadays created to promote the interest, good, or convenience of the public. A bank, for example, is a privatecorporation; yet, it is created for a public benefit. Private schools and universities are likewise private corporations; and yet, they arerendering public service. Private hospitals and wards are charged with heavy social responsibilities. More so with all commoncarriers. On the other hand, there may exist a public corporation even if it is endowed with gifts or donations from privateindividuals.

The true criterion, therefore, to determine whether a corporation is public or private is found in the totality of the relation of thecorporation to the State. If the corporation is created by the State as the latters own agency or instrumentality to help it in carryingout its governmental functions, then that corporation is considered public; otherwise, it is private. Applying the above test, provinces,chartered cities, and barangays can best exemplify public corporations. They are created by the State as its own device and agency for the accomplishment of parts of its own public works.

It is clear that the amendments introduced by C.A. No. 148 revoked the powers of the petitioner to arrest offenders of animalwelfare laws and the power to serve processes in connection therewith.


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Fifth . The respondents argue that since the charter of the petitioner requires the latter to render periodic reports to the CivilGovernor, whose functions have been inherited by the President, the petitioner is, therefore, a government instrumentality.

This contention is inconclusive. By virtue of the fiction that all corporations owe their very existence and powers to the State,the reportorial requirement is applicable to all corporations of whatever nature, whether they are public, quasi-public, or privatecorporationsas creatures of the State, there is a reserved right in the legislature to investigate the activities of a corporation todetermine whether it acted within its powers. In other words, the reportorial requirement is the principal means by which the Statemay see to it that its creature acted according to the powers and functions conferred upon it. These principles were extensivelydiscussed in Bataan Shipyard & Engineering Co., Inc. v. Presidential Commission on Good Government . Here, the Court, in holdingthat the subject corporation could not invoke the right against self-incrimination whenever the State demanded the production of itscorporate books and papers, extensively discussed the purpose of reportorial requirements, viz :

x x x The corporation is a creature of the state. It is presumed to be incorporated for the benefit of the public. It received certainspecial privileges and franchises, and holds them subject to the laws of the state and the limitations of its charter. Its powers arelimited by law. It can make no contract not authorized by its charter. Its rights to act as a corporation are only preserved to it so long asit obeys the laws of its creation. There is a reserve[d] right in the legislature to investigate its contracts and find out whether it hasexceeded its powers. It would be a strange anomaly to hold that a state, having chartered a corporation to make use of certain

franchises, could not, in the exercise of sovereignty, inquire how these franchises had been employed, and whether they had beenabused, and demand the production of the corporate books and papers for that purpose . The defense amounts to this, that an officer of the corporation which is charged with a criminal violation of the statute may plead the criminality of such corporation as a refusal to

produce its books. To state this proposition is to answer it. While an individual may lawfully refuse to answer incriminating questionsunless protected by an immunity statute, it does not follow that a corporation vested with special privileges and franchises may refuse to

show its hand when charged with an abuse of such privileges . (Wilson v. United States, 55 Law Ed., 771, 780.)

Basco v. PAGCOR

GRN 91649, 14 May 1991)

FACTS:On July 11, 1983, PAGCOR was created under Presidential Decree 1869, pursuant to the policy of the government, to regulate andcentralize through an appropriate institution all games of chance authorized by existing franchise or permitted by law. This wassubsequently proven to be beneficial not just to the government but also to the society in general. It is a reliable source of muchneeded revenue for the cash-strapped Government.

Petitioners filed an instant petition seeking to annul the PAGCOR because it is allegedly contrary to morals, public policy and publicorder, among others.

ISSUES:Whether PD 1869 is unconstitutional because:1.) it is contrary to morals, public policy and public order;

2.) it constitutes a waiver of the right of the City of Manila to improve taxes and legal fees; and that the exemption clause in PD 1869is violative of constitutional principle of Local Autonomy;

3.) it violates the equal protection clause of the Constitution in that it legalizes gambling thru PAGCOR while most other forms areoutlawed together with prostitution, drug trafficking and other vices; and

4.) it is contrary to the avowed trend of the Cory Government, away from monopolistic and crony economy and toward free enterpriseand privatization.

HELD:1.) Gambling, in all its forms, is generally prohibited, unless allowed by law. But the prohibition of gambling does not mean that thegovernment can not regulate it in the exercise of its police power, wherein the state has the authority to enact legislation that mayinterfere with personal liberty or property in order to promote the general welfare.

2.) The City of Manila, being a mere Municipal Corporation has no inherent right to impose taxes. Its charter was created byCongress, therefore subject to its control. Also, local governments have no power to tax instrumentalities of the NationalGovernment.

3.) Equal protection clause of the Constitution does not preclude classification of individuals who may be accorded different treatmentunder the law, provided it is not unreasonable or arbitrary. The clause does not prohibit the legislature from establishing classes of individuals or objects upon which different rules shall operate.

4.) The Judiciary does not settle policy issues which are within the domain of the political branches of government and the peoplethemselves as the repository of all state power.

Every law has in its favor the presumption of constitutionality, thus, to be nullified, it must be shown that there is a clear andunequivocal breach of the Constitution. In this case, the grounds raised by petitioners have failed to overcome the presumption.Therefore, it is hereby dismissed for lack of merit.


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LIMBONA VS. MANGELIN

GR No. 80391 28 February 1989

Facts: Petitioner, Sultan Alimbusar Limbona, was elected Speaker of the Regional Legislative Assembly or Batasang Pampook of Central Mindanao (Assembly). On October 21, 1987 Congressman Datu Guimid Matalam, Chairman of the Committee on MuslimAffairs of the House of Representatives, invited petitioner in his capacity as Speaker of the Assembly of Region XII in aconsultation/dialogue with local government officials. Petitioner accepted the invitation and informed the Assembly members throughthe Assembly Secretary that there shall be no session in November as his presence was needed in the house committee hearing of Congress. However, on November 2, 1987, the Assembly held a session in defiance of the Limbona's advice, where he was unseatedfrom his position. Petitioner prays that the session's proceedings be declared null and void and be it declared that he was still theSpeaker of the Assembly. Pending further proceedings of the case, the SC received a resolution from the Assembly expresslyexpelling petitioner's membership therefrom. Respondents argue that petitioner had "filed a case before the Supreme Court againstsome members of the Assembly on a question which should have been resolved within the confines of the Assembly," for which therespondents now submit that the petition had become "moot and academic" because its resolution.

Issue: Whether or not the courts of law have jurisdiction over the autonomous governments or regions. What is the extent of self-government given to the autonomous governments of Region XII?

Held: Autonomy is either decentralization of administration or decentralization of power. There is decentralization of administrationwhen the central government delegates administrative powers to political subdivisions in order to broaden the base of government

power and in the process to make local governments "more responsive and accountable". At the same time, it relieves the centralgovernment of the burden of managing local affairs and enables it to concentrate on national concerns. The President exercises"general supervision" over them, but only to "ensure that local affairs are administered according to law." He has no control over their acts in the sense that he can substitute their judgments with his own. Decentralization of power, on the other hand, involves anabdication of political power in the favor of local governments units declared to be autonomous. In that case, the autonomousgovernment is free to chart its own destiny and shape its future with minimum intervention from central authorities.

An autonomous government that enjoys autonomy of the latter category [CONST. (1987), Art. X, Sec. 15.] is subject alone to thedecree of the organic act creating it and accepted principles on the effects and limits of "autonomy." On the other hand, anautonomous government of the former class is, as we noted, under the supervision of the national government acting through thePresident (and the Department of Local Government). If the Sangguniang Pampook (of Region XII), then, is autonomous in the latter sense, its acts are, debatably beyond the domain of this Court in perhaps the same way that the internal acts, say, of the Congress of

the Philippines are beyond our jurisdiction. But if it is autonomous in the former category only, it comes unarguably under our jurisdiction. An examination of the very Presidential Decree creating the autonomous governments of Mindanao persuades us thatthey were never meant to exercise autonomy in the second sense (decentralization of power). PD No. 1618, in the first place, mandatesthat "[t]he President shall have the power of general supervision and control over Autonomous Regions." Hence, we assume

jurisdiction. And if we can make an inquiry in the validity of the expulsion in question, with more reason can we review the petitioner's removal as Speaker.

This case involves the application of a most

important constitutional policy and principle, that of local autonomy. We have to obey the clear mandate on local autonomy.

Where a law is capable of two interpretations, one in favor of centralized power in Malacaang and the other beneficial to localautonomy, the scales must be weighed in favor of autonomy.

Upon the facts presented, we hold that the November 2 and 5, 1987 sessions were invalid. It is true that under Section 31 of theRegion XII Sanggunian Rules, "[s]essions shall not be suspended or adjourned except by direction of the Sangguniang Pampook". Butwhile this opinion is in accord with the respondents' own, we still invalidate the twin sessions in question, since at the time the

petitioner called the "recess," it was not a settled matter whether or not he could do so. In the second place, the invitation tendered bythe Committee on Muslim Affairs of the House of Representatives provided a plausible reason for the intermission sought. Also,assuming that a valid recess could not be called, it does not appear that the respondents called his attention to this mistake. Whatappears is that instead, they opened the sessions themselves behind his back in an apparent act of mutiny. Under the circumstances, wefind equity on his side. For this reason, we uphold the "recess" called on the ground of good faith.

MAYOR MAGTAJAS & CITY OF CAGAYAN v. PRYCE PROPERTIES & PAGCOR

Facts:PAGCOR decided to expand its operations to Cagayan de Oro City. To this end, it leased a portion of a building belonging to

Pryce Properties Corporation, Inc., renovated and equipped the same, and prepared to inaugurate its casino there during the Christmasseason.

. Civic organizations angrily denounced the project. The religious elements echoed the objection and so did the women'sgroups and the youth. Demonstrations were led by the mayor and the city legislators. The media trumpeted the protest, describing thecasino as an affront to the welfare of the city.

The contention of the petitioners is that it is violative of the Sangguniang Panlungsod of Cagayan de Oro City Ordinance No.3353 prohibiting the use of buildings for the operation of a casino and Ordinance No. 3375-93 prohibiting the operation of casinos.
http://digestyourlaw.blogspot.com/2010/01/limbona-vs-mangelin.htmlhttp://digestyourlaw.blogspot.com/2010/01/limbona-vs-mangelin.html


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On the other hand, the respondents invoke P.D. 1869 which created PAGCOR to help centralize and regulate all games of chance, including casinos on land and sea within the territorial jurisdiction of the Philippines.

The Court of Appeals ruled in favor of the respondents. Hence, the petition for review.

Issue: Whether or not the Ordinance No. 3353 and Ordinance No. 3375-93 are valid

Held: No

Ratio:Cagayan de Oro City, like other local political subdivisions, is empowered to enact ordinances for the purposes indicated in

the Local Government Code. It is expressly vested with the police power under what is known as the General Welfare Clause nowembodied in Section 16 as follows:

***Sec. 16. General Welfare. Every local government unit shall exercise the powers expressly granted, thosenecessarily implied therefrom, as well as powers necessary, appropriate, or incidental for its efficient and effectivegovernance, 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 thedevelopment of appropriate and self-reliant scientific and technological capabilities, improve public morals, enhanceeconomic prosperity and social justice, promote full employment among their residents, maintain peace and order, and

preserve the comfort and convenience of their inhabitants.There is a requirement that the ordinances should not contravene a statute. Municipal governments are only agents of the

national government. Local councils exercise only delegated legislative powers conferred on them by Congress as the nationallawmaking body. The delegate cannot be superior to the principal or exercise powers higher than those of the latter. It is a heresy tosuggest that the local government units can undo the acts of Congress, from which they have derived their power in the first place, andnegate by mere ordinance the mandate of the statute.

Casino gambling is authorized by P.D. 1869. This decree has the status of a statute that cannot be amended or nullified by amere ordinance.

Therefore, the petition is DENIED and the challenged decision of the Court of Appeals is AFFIRMED.

Laguna Lake Development Authority vs CADate: December 7, 1995Petitioner: Laguna Lake Development AuthorityRespondents: CA, Hon. Judge Herculano Tech, Fleet Development Inc and Carlito Arroyo

Ponente: Hermosisima Jr

Facts: RA 4850 was enacted creating the "Laguna Lake Development Authority." This agency was supposed to accelerate thedevelopment and balanced growth of the Laguna Lake area and the surrounding provinces, cities and towns, in the act, within thecontext of the national and regional plans and policies for social and economic development.

PD 813 amended certain sections RA 4850 because of the concern for the rapid expansion of Metropolitan Manila, thesuburbs and the lakeshore towns of Laguna de Bay, combined with current and prospective uses of the lake for municipal-industrialwater supply, irrigation, fisheries, and the like.

To effectively perform the role of the Authority under RA 4850, the Chief Executive issued EO 927 further defined andenlarged the functions and powers of the Authority and named and enumerated the towns, cities and provinces encompassed by theterm "Laguna de Bay Region". Also, pertinent to the issues in this case are the following provisions of EO 927 which include in

particular the sharing of fees:Sec 2: xxx the Authority shall have exclusive jurisdiction to issue permit for the use of all surface water for any projects or activities in

or affecting the said region including navigation, construction, and operation of fishpens, fish enclosures, fish corrals and the like.SEC. 3. Collection of Fees. The Authority is hereby empowered to collect fees for the use of the lake water and its tributaries for all beneficial purposes including but not limited to fisheries, recreation, municipal, industrial, agricultural, navigation, irrigation, andwaste disposal purpose; Provided, that the rates of the fees to be collected, and the sharing with other government agencies and

political subdivisions, if necessary, shall be subject to the approval of the President of the Philippines upon recommendation of theAuthority's Board, except fishpen fee, which will be shared in the following manner: 20 percent of the fee shall go to the lakeshorelocal governments, 5 percent shall go to the Project Development Fund which shall be administered by a Council and the remaining 75

percent shall constitute the share of LLDA. However, after the implementation within the three-year period of the Laguna LakeFishery Zoning and Management Plan the sharing will be modified as follows: 35 percent of the fishpen fee goes to the lakeshore localgovernments, 5 percent goes to the Project Development Fund and the remaining 60 percent shall be retained by LLDA; Provided,however, that the share of LLDA shall form part of its corporate funds and shall not be remitted to the National Treasury as anexception to the provisions of Presidential Decree No. 1234.

Then came Republic Act No. 7160. The municipalities in the Laguna Lake Region interpreted the provisions of this law tomean that the newly passed law gave municipal governments the exclusive jurisdiction to issue fishing privileges within their municipal waters because R.A. 7160 provides:"Sec. 149. Fishery Rentals; Fees and Charges (a) Municipalities shall have the exclusive authority to grant fishery privileges in themunicipal waters and impose rental fees or charges therefor in accordance with the provisions of this Section.

Municipal governments thereupon assumed the authority to issue fishing privileges and fishpen permits. Big fishpenoperators took advantage of the occasion to establish fishpens and fishcages to the consternation of the Authority. Unregulatedfishpens and fishcages occupied almost one-third the entire lake water surface area, increasing the occupation drastically from 7,000ha in 1990 to almost 21,000 ha in 1995. The Mayor's permit to construct fishpens and fishcages were all undertaken in violation of the

policies adopted by the Authority on fishpen zoning and the Laguna Lake carrying capacity. In view of the foregoing circumstances,the Authority served notice to the general public that:


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1. All fishpens, fishcages and other aqua-culture structures in the Laguna de Bay Region, which were not registered or to which noapplication for registration and/or permit has been filed with Laguna Lake Development Authority as of March 31, 1993 are herebydeclared outrightly as illegal.

2. All fishpens; fishcages and other aqua-culture structures so declared as illegal shall be subject to demolition which shall beundertaken by the Presidential Task Force for illegal Fishpen and Illegal Fishing.

3. Owners of fishpens, fishcages and other aqua-culture structures declared as illegal shall, without prejudice to demolition of their structures be criminally charged in accordance with Section 39-A of Republic Act 4850 as amended by P.D. 813 for violation of thesame laws. Violations of these laws carries a penalty of imprisonment of not exceeding 3 years or a fine not exceeding Five ThousandPesos or both at the discretion of the court.All operators of fishpens, fishcages and other aqua-culture structures declared as illegal in accordance with the foregoing Notice shallhave one (1) month on or before 27 October 1993 to show cause before the LLDA why their said fishpens, fishcages and other aqua-culture structures should not be demolished/dismantled."

One month, thereafter, the Authority sent notices to the concerned owners of the illegally constructed fishpens, fishcages andother aqua-culture structures advising them to dismantle their respective structures within 10 days from receipt thereof, otherwise,demolition shall be effected.

The fishpen owners filed injunction cases against the LLDA. The LLDA filed motions to dismiss the cases against it on jurisdictional grounds. The motions to dismiss were denied. Meanwhile, TRO/writs of preliminary mandatory injunction were issuedenjoining the LLDA from demolishing the fishpens and similar structures in question. Hence, the present petition for certiorari,

prohibition and injunction. The CA dismissed the LLDAs consolidated petitions. It ruled that (A) LLDA is not among those quasi- judicial agencies of government appealable only to the Court of Appeals; (B) the LLDA charter does vest LLDA with quasi-judicialfunctions insofar as fishpens are concerned; (C) the provisions of the LLDA charter insofar as fishing privileges in Laguna de Bay areconcerned had been repealed by the Local Government Code of 1991; (D) in view of the aforesaid repeal, the power to grant permitsdevolved to respective local government units concerned.

Issue: Which agency of the Government - the LLDA or the towns and municipalities comprising the region - should exercise jurisdiction over the Laguna Lake and its environs insofar as the issuance of permits for fishery privileges is concerned?

Held: LLDA

Ratio: Section 4 (k) of RA 4850, the provisions of PD 813, and Section 2 of EO 927, specifically provide that the LLDA shall haveexclusive jurisdiction to issue permits for the use or all surface water for any projects or activities in or affecting the said region,including navigation, construction, and operation of fishpens, fish enclosures, fish corrals and the like. On the other hand, RA 7160has granted to the municipalities the exclusive authority to grant fishery privileges in municipal waters. The Sangguniang Bayan maygrant fishery privileges to erect fish corrals, oyster, mussels or other aquatic beds or bangus fry area within a definite zone of themunicipal waters.

The provisions of RA7160 do not necessarily repeal the laws creating the LLDA and granting the latter water rights authority

over Laguna de Bay and the lake region.The Local Government Code of 1991 does not contain any express provision which categorically expressly repeal the charter

of the Authority. It has to be conceded that there was no intent on the part of the legislature to repeal Republic Act No. 4850 and itsamendments. The repeal of laws should be made clear and expressed.

It has to be conceded that the charter of the LLDA constitutes a special law. RA 7160 is a general law. It is basic is basic instatutory construction that the enactment of a later legislation which is a general law cannot be construed to have repealed a speciallaw. It is a well-settled rule in this jurisdiction that "a special statute, provided for a particular case or class of cases, is not repealed bya subsequent statute, general in its terms, provisions and application, unless the intent to repeal or alter is manifest, although the termsof the general law are broad enough to include the cases embraced in the special law." Where there is a conflict between a generallaw and a special statute, the special statute should prevail since it evinces the legislative intent more clearly that the general statute.The special law is to be taken as an exception to the general law in the absence of special circumstances forcing a contrary conclusion.This is because implied repeals are not favored and as much as possible, given to all enactments of the legislature. A special lawcannot be repealed, amended or altered by a subsequent general law by mere implication.

Considering the reasons behind the establishment of the Authority, which are enviromental protection, navigational safety,and sustainable development, there is every indication that the legislative intent is for the Authority to proceed with its mission.We are on all fours with the manifestation of LLDA that "Laguna de Bay, like any other single body of water has its own

unique natural ecosystem. The 900 km lake surface water, the 8 major river tributaries and several other smaller rivers that drain intothe lake, the 2,920 km2 basin or watershed transcending the boundaries of Laguna and Rizal provinces, constitute one integrateddelicate natural ecosystem that needs to be protected with uniform set of policies; if we are to be serious in our aims of attainingsustainable development. This is an exhaustible natural resource-a very limited one-which requires judicious management and optimalutilization to ensure renewability and preserve its ecological integrity and balance. Managing the lake resources would mean theimplementation of a national policy geared towards the protection, conservation, balanced growth and sustainable development of theregion with due regard to the inter-generational use of its resources by the inhabitants in this part of the earth. The authors of RepublicAct 4850 have foreseen this need when they passed this LLDA law-the special law designed to govern the management of our Lagunade Bay lake resources. Laguna de Bay therefore cannot be subjected to fragmented concepts of management policies where lakeshorelocal government units exercise exclusive dominion over specific portions of the lake water. The implementation of a cohesive andintegrated lake water resource management policy, therefore, is necessary to conserve, protect and sustainably develop Laguna deBay."

The power of the LGUs to issue fishing privileges was clearly granted for revenue purposes. This is evident from the fact thatSection 149 of the New Local Government Code empowering local governments to issue fishing permits is embodied in Chapter 2,Book II, of Republic Act No. 7160 under the heading, "Specific Provisions On The Taxing And Other Revenue Raising Power of LGUs.

On the other hand, the power of the Authority to grant permits for fishpens, fishcages and other aqua-culture structures is for the purpose of effectively regulating and monitoring activities in the Laguna de Bay region and for lake quality control andmanagement. 6 It does partake of the nature of police power which is the most pervasive, the least limitable and the most demandingof all State powers including the power of taxation. Accordingly the charter of the Authority which embodies a valid exercise of police

power should prevail over the Local Government Code of 1991 on matters affecting Laguna de Bay.


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There should be no quarrel over permit fees for fishpens, fishcages and other aqua-culture structures in the Laguna de Bayarea. Section 3 of Executive Order No. 927 provides for the proper sharing of fees collected.

In respect to the question as to whether the Authority is a quasi-judicial agency or not, it is our holding that, considering the provisions of Section 4 of Republic Act No. 4850 and Section 4 of Executive Order No. 927, series of 1983, and the ruling of thisCourt in Laguna Lake Development Authority vs. Court of Appeals, there is no question that the Authority has express powers as aregulatory a quasi-judicial body in respect to pollution cases with authority to issue a "cease a desist order" and on matters affectingthe construction of illegal fishpens, fishcages and other aqua-culture structures in Laguna de Bay. The Authority's pretense, however,that it is co-equal to the Regional Trial Courts such that all actions against it may only be instituted before the Court of Appeals cannot

be sustained. On actions necessitating the resolution of legal questions affecting the powers of the Authority as provided for in itscharter, the Regional Trial Courts have jurisdiction.

In view of the foregoing, this Court holds that Section 149 of RA 7160, otherwise known as the Local Government Code of 1991, has not repealed the provisions of the charter of the LLDA, Republic Act No. 4850, as amended. Thus, the Authority has theexclusive jurisdiction to issue permits for the enjoyment of fishery privileges in Laguna de Bay to the exclusion of municipalitiessituated therein and the authority to exercise such powers as are by its charter vested on it.

PLAZA vs. CASSION

Facts : Before the passage of RA No. 7160, the task of delivering basic social services was dispensed by the national governmentthrough the DSWD. Upon the promulgation and implementation of the Local Government Code, some of the functions of the DSWDwere transferred to the LGUs. The City of Butuan, through its Sanggunian, passed SP Resolution 427-92 entitled "ResolutionAuthorizing the City Mayor, Honorable Democrito D. Plaza II, to Sign the Memorandum of Agreement for the Devolution of theDSWD to the City of Butuan." Pursuant to the MoA, DSWD's services, personnel, assets and liabilities, and technical supportsystems were then transferred to its city counterpart. Mayor Plaza issued EO No. 06-925 reconstituting the City Social ServicesDevelopment Office (CSSDO), devolving or adding thereto 19 national DSWD employees headed by petitioner Virginia Tuazon.Social Welfare Officer V. Mayor Plaza designated her Officer-in-Charge of the reconstituted CSSDO.

The CSSDO was originally composed of herein respondents. Aggrieved by such development, they refused to recognize petitioner Tuazon as their new head and to report at the DSWD building. They contended that the issuance of EO No. 06-92 by Mayor Plaza andthe designation of petitioner Tuazon as Officer-in-charge of the CSSDO are illegal. Despite Mayor Plaza's series of orders torespondents to report for work at the DSWD building, they failed to do so. Thereafter, they were charged administratively for gravemisconduct and insubordination and were preventively suspended for 60 days. This prompted them to file with the Civil ServiceRegional Office a complaint against Mayor Plaza for violation of the Civil Service Law. However, their complaint was dismissed for lack of merit.

Upon expiration of their preventive suspension, respondents informed Mayor Plaza that they are willing to return to work, but to their old office, not to the DSWD building. Mayor Plaza notified respondents to report to petitioner Tuazon at the new office in the DSWD

building, but they remained obstinate. Mayor Plaza inquired from the CSC on what appropriate action could be taken againstrespondents. The CSC, through Atty. Lorea, informed the Mayor that respondents could be dropped from the rolls pursuant to CSCMemorandum Circular No. 38, Series of 1993, which provides that "Officers and employees who are absent for at least 30 dayswithout approved leave are considered on Absence Without Official Leave and may be dropped from the service without prior notice.Mayor Plaza issued an Order dropping respondents from the rolls pursuant to the said CSC Memorandum Circular.

Issue : Whether or not respondents should be dropped from the rolls pursuant to CSC Memorandum Circular No. 38.

Held : Petitioners contend that the CA erred in setting aside the CSC Resolutions dropping respondents from the rolls and EO No. 06-92, which directs the devolution of 19 national DSWD employees to the local or city DSWD to be headed by petitioner VirginiaTuazon. Private respondents aver that their refusal to report for work is justified since EO No. 06-92 is not valid as it was issuedwithout prior approval by the Sanggunian in violation of Article 164, Rule XXII of the Rules and Regulations Implementing the LGC.

Section 17 of the LGC authorizes the devolution of personnel, assets and liabilities, records of basic services, and facilities of anational government agency to local government units. Under this Code, the term "devolution" refers to the act by which the nationalgovernment confers power and authority upon the various local government units to perform specific functions and responsibilities.As a consequence of the devolution of national agencies, Executive Order No. 503 was enacted by then President Corazon C. Aquinoto govern and ensure the efficient transfer of responsibilities to the local government unit concerned.

It is thus clear that Mayor Plaza is empowered to issue EO No. 06-92 in order to give effect to the devolution decreed by the LGC. Asthe local chief executive of Butuan City, Mayor Plaza has the authority to reappoint devolved personnel and may designate anemployee to take charge of a department until the appointment of a regular head, as was done by the Mayor here. CSC MemorandumCircular No. 19 provides further that heads of departments appointed by the local chief executive must have the concurrence of themajority of all the members of the Sanggunian concerned. While initially, the Sanggunian rejected petitioner Tuazon's appointment asthe City Government Department Head II of the CSSDO, however, it later confirmed her appointment.

The CA erred in ruling that EO No. 06-92 violated respondents' security of tenure as they were transferred to another office withouttheir consent. There was no such transfer. Transfer is a movement from one position to another which is of equivalent rank, level or salary without break in service and may be imposed as an administrative penalty. The change of respondents' place of work from theoriginal CSSDO office to the DSWD building is not a transfer. It was only a physical transfer of their office to a new one done in theinterest of public service. There were no new movements or appointments from one position to another.

Private respondents argue that they were denied due process when they were dropped from the rolls. Pursuant to CSC MemorandumCircular No. 38, the dropping from the rolls of private respondents is not disciplinary in nature. Thus, their assertion that they weredenied due process is untenable. Since the dropping from the rolls is not an administrative sanction, they need not be notified or beheard.

MMDA v. Bel-Air


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Facts: Metropolitan Manila Development Authority (MMDA), petitioner herein, is a Government Agency tasked with the delivery of basic services in Metro Manila. Bel-Air Village Association (BAVA), respondent herein, received a letter of request from the petitioner to open Neptune Street of Bel-Air Village for the use of the public. The said opening of Neptune Street will be for the safeand convenient movement of persons and to regulate the flow of traffic in Makati City. This was pursuant to MMDA law or RepublicAct No. 7924. On the same day, the respondent was appraised that the perimeter wall separating the subdivision and Kalayaan Avenuewould be demolished.

The respondent, to stop the opening of the said street and demolition of the wall, filed a preliminary injunction and a temporaryrestraining order. Respondent claimed that the MMDA had no authority to do so and the lower court decided in favor of theRespondent. Petitioner appealed the decision of the lower courts and claimed that it has the authority to open Neptune Street to publictraffic because it is an agent of the State that can practice police power in the delivery of basic services in Metro Manila.

Issue: Whether or not the MMDA has the mandate to open Neptune Street to public traffic pursuant to its regulatory and police powers.

Held: The Court held that the MMDA does not have the capacity to exercise police power. Police power is primarily lodged in the National Legislature. However, police power may be delegated to government units. Petitioner herein is a development authority andnot a political government unit. Therefore, the MMDA cannot exercise police power because it cannot be delegated to them. It is not alegislative unit of the government. Republic Act No. 7924 does not empower the MMDA to enact ordinances, approve resolutions andappropriate funds for the general welfare of the inhabitants of Manila. There is no syllable in the said act that grants MMDA police

power.

The Constitution, however, recognized the necessity of creating metropolitan regions not only in the existing National Capital Region but also in potential equivalents in the Visayas and Mindanao. 43 Section 11 of the same Article X thus provided:

Sec. 11. The Congress may, by law, create special metropolitan political subdivisions, subject to a plebiscite as set forth in Section 10

hereof. The component cities and municipalities shall retain their basic autonomy and shall be entitled to their own local executivesand legislative assemblies. The jurisdiction of the metropolitan authority that will thereby be created shall be limited to basic servicesrequiring coordination. [ traffic]

It is thus beyond doubt that the MMDA is not a local government unit or a public corporation endowed with legislative power. It is noteven a "special metropolitan political subdivision" as contemplated in Section 11, Article X of the Constitution. The creation of a"special metropolitan political subdivision" requires the approval by a majority of the votes cast in a plebiscite in the political units

directly affected." 56

R. A. No. 7924 was not submitted to the inhabitants of Metro Manila in a plebiscite. The Chairman of the MMDAis not an official elected by the people, but appointed by the President with the rank and privileges of a cabinet member. In fact, part of his function is to perform such other duties as may be assigned to him by the President, 57 whereas in local government units, thePresident merely exercises supervisory authority. This emphasizes the administrative character of the MMDA

Province of Batangas Vs. RomuloG.R. No. 152774. May 27, 2004

Relevant Background:

It was a case filed by Hon. HERMILANDO I. MANDANAS, Governor of Batangas petition for certiorari, prohibition and mandamusto declare as unconstitutional and void certain provisos contained in the General Appropriations Acts (GAA) of 1999, 2000 and 2001,

insofar as they uniformly earmarked (allocated) for each corresponding year the amount of five billion pesos (P5,000,000,000.00) of the Internal Revenue Allotment (IRA) for the Local Government Service Equalization Fund (LGSEF) and imposed conditions for therelease thereof.

It started in 1998 when then President Joseph Estrada issued Executive Order No. 48 entitled ESTABLISHING A PROGRAM FOR DEVOLUTION ADJUSTMENT AND EQUALIZATION to facilitate the process of enhancing the capabilities of local governmentunits in the discharge of the functions and services devolved to them pursuant to the Local Government Code. Included in the EO No.48 is the appointment of the Oversight Committee authorized to issue the implementing rules and regulations governing the equitableallocation and distribution of said fund to the LGUs..

Subject of the case are the resolutions passed by the Oversight Committee (Chaired by the Executive Secretary Ronaldo B. Zamora).These are the resolutions with numbers OCD-99-005, OCD-99-006, and OCD-99-003. Further, these OCDs were approved by thenPres. Estrada on October 6, 1999. The guidelines along with these OCDs as formulated by the Oversight Committee requires theLGUs to identify the projects eligible for funding under the portion of LGSEF and submit the project proposals and other requirementsto the DILG for appraisal before the Committee serves notice to the DBM for the subsequent release of corresponding funds.

For the year 2000 and 2001, the same LGSEF of 1999 GAA were adopted due to failure of Congress to enact general appropriationlaws.

The standing point was when Gov. Mandanas received the LGSEF in the GAA of 1991.

The 5Billion LGESF for 2001 were as follows:

Modified Codal Formula P3.0BillionPriority Projects P1.9 Billion
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Capability Building Fund P0.1 Billion, Total = P5Billion

Furthere, the P3.0Billion of the abovementioned LGESF shall be allocated according to the modified codal formula and be released tothe four levels of LGUs., ie., provinces, cities, municipalities and barangays as follos:

Provinces, 25% - P0.750BillionCities, 25% - 0.750Municipalities, 35% - 1.050Barangays, 15% - 0.450, Total = P3BillionResolved Further, the P1.9Billion earmarked for Priority Projects shall be distributed according to the following criteria:

1. For projects of the 4th, 5th, and 6th class LGUs, or 2. Projects in consonance with the Presidents SONA

Upon Upon receipt of a copy of the above resolution, Gov. Mandanas wrote to the individual members of the Oversight Committeeseeking the reconsideration of Resolution No. OCD-2002-001. He also wrote to Pres. Macapagal-Arroyo urging her to disapprovesaid resolution as it violates the Constitution and the Local Government Code of 1991 but otherwise, approved by Pres. Arroyo onJanuary 25, 2002.

The Petitioner Points the Following Issues:

1. Unconstitutionality and void provisos in the GAAs of 1999, 2000, and 2001.

2. Unlawful and illegal imposition of conditions issued by the Oversight Committee requiring project proposals anddocumentary requirements prior to the release of LGUs just share in the IRA is an anathema to the principle of localautonomy as embodied in the Constitution and the Local Government Code of 1991 (and that the possible disapproval by theCommittee of the project proposals of the LGUs is a diminution to then latters share in the IRA).

The petitioner contends the following:

In issue No.1 & 3, the respondent theorized that Section 285 of the Local Government Code of 1991 which provides for the percentage sharing of the IRA among the LGUs was not intended to be a fixed determination of share in the national taxes as theCongress may enact other laws, including the aforementioned oppropriations law providing for a different sharing formula.Section 285 merely intended to be the default share of the LGUs to do away with the need to determine annually.

Further, the respondent avers that the petition has already been rendered as moot and academic as it no longer presents a

justifiable controversy because the IRAs of the years 1999, 2000 and 2001 have already been released and therefore, nothingmore to prohibit, aside from the fact that the petition should not have been filed with the Supreme Court because this court is not atrier of facts, but, the lower courts of jurisdiction.

In issue No.2, the assailed resolutions issued by the Oversight Committee are not constitutionally infirm. The respondents standsthat Section 6 of Article X of the Constitution does not specify the just share of the LGUs shall be determined solely by theLocal Government Code of 1991 and that the phrase to be determined by law in the same provision means that there exists nolimitation on the power of Congress to determine what is the just share of the LGUs in the national taxes. In effect, theCongress serves as the arbiter of what should be the just share.

Courts Ruling:

The Court finds the petition to involve a significant legal issue. Issue No.1 is the crux of the instant controversy as contained in the

GAAs of 1999, 2000 and 2001 and the OCD resolutions infringe the Constitution and the Local Government Code of 1991 andundoubtedly a legal question. However, the earmarking of the LGSEF, the promulgation of the assailed OCD resolutions and therelease of the LGSEF to the LGU following the requirements are not disputed.

Substantive issues stated above, in the course of the argument, although the supervening events as the IRA including the LGSEF for 1999, 2000 and 2001 had already been released, still, there was a compelling reason to resolve the substantive issue raised in theinstant petition, whether intended or incidental, cannot prevent the Court from rendering a decision if grave violation of theConstitution is proved even where the supervening events had made the cases moot in order to resolve the legal or constitutionalissues raised to formulate controlling principles to guide the bench, bar and public.

The court held that, the state shall ensure the autonomy of local governments. (Art. II Sec. 25 of the Constitution). Consistent withthe principle of local autonomy, the Constitution confines the Presidents power over the LGUs to one of general supervision and hasno power to control

The Local Government Code of 1991 was enacted to flesh out the mandate of the Constitution. The State policy on local autonomy isamplified in Section 2 thereof:

Sec. 2. Declaration of Policy. (a) It is hereby declared the policy of the State that the territorial and political subdivisions of the Stateshall enjoy genuine and meaningful local autonomy to enable them to attain their fullest development as self-reliant communities andmake them more effective partners in the attainment of national goals. Toward this end, the State shall provide for a more responsiveand accountable local government structure instituted through a system of decentralization whereby local government units shall be

given more powers, authority, responsibilities, and resources .


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Guided by these precepts, the Court shall now determine whether the assailed provisos in the GAAs of 1999, 2000 and 2001,earmarking for each corresponding year the amount of five billion pesos of the IRA for the LGSEF and the OCD resolutions

promulgated pursuant thereto, transgress the Constitution and the Local Government Code of 1991.

To the Courts mind, the entire process involving the distribution and release of the LGSEF is constitutionally impermissible. TheLGSEF is part of the IRA or just share of the LGUs in the national taxes. To subject its distribution and release to the vagaries of the implementing rules and regulations, including the guidelines and mechanisms unilaterally prescribed by the Oversight Committeefrom time to time, as sanctioned by the assailed provisos in the GAAs of 1999, 2000 and 2001 and the OCD resolutions, makes therelease not automatic, a flagrant violation of the constitutional and statutory mandate that the just share of the LGUs shall beautomatically released to them . The LGUs are, thus, placed at the mercy of the Oversight Committee.

That the automatic release of the IRA was precisely intended to guarantee and promote local autonomy can be gleaned from thediscussion below between Messrs. Jose N. Nolledo and Regalado M. Maambong, then members of the 1986 ConstitutionalCommission.

Our national officials should not only comply with the constitutional provisions on local autonomy but should also appreciate thespirit and liberty upon which these provisions are based.

WHEREFORE, the petition is GRANTED. The assailed provisos in the General Appropriations Acts of 1999, 2000 and 2001, and theassailed OCD Resolutions, are declared UNCONSTITUTIONAL.

Batangas Power Corporation vs. Batangas City, G.R. No. 152675, April 28, 2004

Facts: In the early 1990s, power outages lasted 8-12 hours daily and power generation was badly needed. The government, throughthe National Power Corporation (NPC), sought to attract investors in power plant operations by providing them with incentives, one of which was through the NPCs assumption of payment of their taxes in the Build Operate and Transfer (BOT) Agreement.On June 29, 1992, Enron Power Development Corporation (Enron) and petitioner NPC entered into a Fast Track BOT Project. Enronagreed to supply a power station to NPC and transfer its plant to the latter after ten (10) years of operation. Section 11.02 of the BOTAgreement provided that NPC shall be responsible for the payment of all taxes that may be imposed on the power station, exceptincome taxes and permit fees . Subsequently, Enron assigned its obligation under the BOT Agreement to petitioner Batangas PowerCorporation (BPC).On September 23, 1992, the BOI issued a certificate of registration to BPC as a pioneer enterprise entitled to a tax holiday for aperiod of six (6) years . On October 12, 1998, Batangas City sent a letter to BPC demanding payment of business taxes and penalties,commencing from the year 1994, BPC refused to pay, citing its tax-exempt status as a pioneer enterprise for six (6) years under Section 133 (g) of the Local Government Code (LGC). The citys tax claim was modified and demanded payment of business taxes

from BPC only for the years 1998-1999. BPC still refused to pay the tax. It insisted that its 6-year tax holiday commenced from thedate of its commercial operation on July 16, 1993 , not from the date of its BOI registration in September 1992.In the alternative, BPC asserted that the city should collect the tax from the NPC as the latter assumed responsibility for its paymentunder their BOT Agreement . On August 26, 1999, the NPC intervened. While admitting assumption of BPCs tax obligations under their BOT Agreement, NPC refused to pay BPCs business tax as it allegedly constituted an indirect tax on NPC which is a tax-exempt corporation under its Charter .BPC filed a petition for declaratory relief12 with the Makati RTC against Batangas City and NPC. It alleged that under the BOTAgreement, NPC is responsible for the payment of such taxes but as NPC is exempt from taxes, both the BPC and NPC are notliable for its payment .Makati RTC dismissed the petition and held that: (1) BPC is liable to pay business taxes to the city; (2) NPCs tax exemption waswithdrawn with the passage of R.A. No. 7160 (The Local Government Code) ; and, (3) the 6-year tax holiday granted to pioneer

business enterprises starts on the date of registration with the BOI as provided in Section 133 (g) of R.A. No. 7160, and not on the dateof its actual business operations.

Issue: Whether or not NPCs tax exemption privileges under its Charter were withdrawn by Section 193 of the Local GovernmentCode (LGC).Held: Yes. The effect of the LGC on the tax exemption privileges of the NPC has already been extensively discussed and settled in therecent case of National Power Corporation v. City of Cabanatuan. In said case, this Court recognized the removal of the blanketexclusion of government instrumentalities from local taxation as one of the most significant provisions of the 1991 LGC.Specifically, we stressed that Section 193 of the LGC, an express and general repeal of all statutes granting exemptions from localtaxes, withdrew the sweeping tax privileges previously enjoyed by the NPC under its Charter .The power to tax is no longer vested exclusively on Congress; local legislative bodies are now given direct authority to levy taxes,fees and other charges pursuant to Article X, section 5 of the 1987 Constitution. The LGC is considered as the most revolutionary

piece of legislation on local autonomy, the LGC effectively deals with the fiscal constraints faced by LGUs. It widens the tax base of LGUs to include taxes which were prohibited by previous laws.

Neither can the NPC successfully rely on the Basco case as this was decided prior to the effectivity of the LGC , when there was stillno law empowering local government units to tax instrumentalities of the national government.Thus, while BPC remains to be the entity doing business in said city, it is the NPC that is ultimately liable to pay said taxes under the

provisions of both the 1992 BOT Agreement and the 1991 Local Government Code.Other Issue: Whether BPCs 6-year tax holiday commenced on the date of its BOI registration as a pioneer enterprise or on the dateof its actual commercial operation as certified by the BOI.Sec. 133 (g) of the LGC, which proscribes local government units (LGUs) from levying taxes on BOI-certified pioneer enterprises for a

period of six years from the date of registration, applies specifically to taxes imposed by the local government, like the business tax imposed by Batangas City on BPC in the case at bar. The 6-year tax exemption of BPC should thus commence from the date of BPCsregistration with the BOI.

Cases 1 - Pub Corp

Documents

Transcript of Cases 1 - Pub Corp