G.R. No.

80391 February 28, 1989

SULTAN ALIMBUSAR P. LIMBONA, petitioner,

vs.

CONTE MANGELIN, SALIC ALI, SALINDATO ALI, PILIMPINAS CONDING, ACMAD TOMAWIS, GERRY
TOMAWIS, JESUS ORTIZ, ANTONIO DELA FUENTE, DIEGO PALOMARES, JR., RAUL DAGALANGIT,
and BIMBO SINSUAT, respondents.

Ambrosio Padilla, Mempin & Reyes Law Offices for petitioner petitioner.

Makabangkit B. Lanto for respondents.

SARMIENTO, J.:

The acts of the Sangguniang Pampook of Region XII are assailed in this petition. The antecedent facts are
as follows:

1. On September 24, 1986, petitioner Sultan Alimbusar Limbona was appointed as a member of the
Sangguniang Pampook, Regional Autonomous Government, Region XII, representing Lanao del Sur.

2. On March 12, 1987 petitioner was elected Speaker of the Regional Legislative Assembly or Batasang
Pampook of Central Mindanao (Assembly for brevity).

3. Said Assembly is composed of eighteen (18) members. Two of said members, respondents Acmad
Tomawis and Pakil Dagalangit, filed on March 23, 1987 with the Commission on Elections their respective
certificates of candidacy in the May 11, 1987 congressional elections for the district of Lanao del Sur but
they later withdrew from the aforesaid election and thereafter resumed again their positions as members of
the Assembly.

4. On October 21, 1987 Congressman Datu Guimid Matalam, Chairman of the Committee on Muslim Affairs
of the House of Representatives, invited Mr. Xavier Razul, Pampook Speaker of Region XI, Zamboanga City
and the petitioner in his capacity as Speaker of the Assembly, Region XII, in a letter which reads:

The Committee on Muslim Affairs well undertake consultations and dialogues with local government officials,
civic, religious organizations and traditional leaders on the recent and present political developments and
other issues affecting Regions IX and XII.

The result of the conference, consultations and dialogues would hopefully chart the autonomous
governments of the two regions as envisioned and may prod the President to constitute immediately the
Regional Consultative Commission as mandated by the Commission.
You are requested to invite some members of the Pampook Assembly of your respective assembly on
November 1 to 15, 1987, with venue at the Congress of the Philippines. Your presence, unstinted support
and cooperation is (sic) indispensable.

5. Consistent with the said invitation, petitioner sent a telegram to Acting Secretary Johnny Alimbuyao of the
Assembly to wire all Assemblymen that there shall be no session in November as "our presence in the
house committee hearing of Congress take (sic) precedence over any pending business in batasang
pampook ... ."

6. In compliance with the aforesaid instruction of the petitioner, Acting Secretary Alimbuyao sent to the
members of the Assembly the following telegram:

TRANSMITTING FOR YOUR INFORMATION AND GUIDANCE TELEGRAM RECEIVED FROM SPEAKER
LIMBONA QUOTE CONGRESSMAN JIMMY MATALAM CHAIRMAN OF THE HOUSE COMMITTEE ON
MUSLIM AFFAIRS REQUESTED ME TO ASSIST SAID COMMITTEE IN THE DISCUSSION OF THE
PROPOSED AUTONOMY ORGANIC NOV. 1ST TO 15. HENCE WERE ALL ASSEMBLYMEN THAT
THERE SHALL BE NO SESSION IN NOVEMBER AS OUR PRESENCE IN THE HOUSE COMMITTEE
HEARING OF CONGRESS TAKE PRECEDENCE OVER ANY PENDING BUSINESS IN BATASANG
PAMPOOK OF MATALAM FOLLOWS UNQUOTE REGARDS.

7. On November 2, 1987, the Assembly held session in defiance of petitioner's advice, with the following
assemblymen present:

1. Sali, Salic

2. Conding, Pilipinas (sic)

3. Dagalangit, Rakil

4. Dela Fuente, Antonio

5. Mangelen, Conte

6. Ortiz, Jesus

7. Palomares, Diego

8. Sinsuat, Bimbo

9. Tomawis, Acmad
10. Tomawis, Jerry

After declaring the presence of a quorum, the Speaker Pro-Tempore was authorized to preside in the
session. On Motion to declare the seat of the Speaker vacant, all Assemblymen in attendance voted in the
affirmative, hence, the chair declared said seat of the Speaker vacant. 8. On November 5, 1987, the session
of the Assembly resumed with the following Assemblymen present:

1. Mangelen Conte-Presiding Officer

2. Ali Salic

3. Ali Salindatu

4. Aratuc, Malik

5. Cajelo, Rene

6. Conding, Pilipinas (sic)

7. Dagalangit, Rakil

8. Dela Fuente, Antonio

9. Ortiz, Jesus

10 Palomares, Diego

11. Quijano, Jesus

12. Sinsuat, Bimbo

13. Tomawis, Acmad

14. Tomawis, Jerry

An excerpt from the debates and proceeding of said session reads:

HON. DAGALANGIT: Mr. Speaker, Honorable Members of the House, with the presence of our colleagues
who have come to attend the session today, I move to call the names of the new comers in order for them to
cast their votes on the previous motion to declare the position of the Speaker vacant. But before doing so, I
move also that the designation of the Speaker Pro Tempore as the Presiding Officer and Mr. Johnny
Evangelists as Acting Secretary in the session last November 2, 1987 be reconfirmed in today's session.

HON. SALIC ALI: I second the motions.

PRESIDING OFFICER: Any comment or objections on the two motions presented? Me chair hears none
and the said motions are approved. ...

Twelve (12) members voted in favor of the motion to declare the seat of the Speaker vacant; one abstained
and none voted against. 1

Accordingly, the petitioner prays for judgment as follows:

WHEREFORE, petitioner respectfully prays that-

(a) This Petition be given due course;

(b) Pending hearing, a restraining order or writ of preliminary injunction be issued enjoining respondents
from proceeding with their session to be held on November 5, 1987, and on any day thereafter;

(c) After hearing, judgment be rendered declaring the proceedings held by respondents of their session
on November 2, 1987 as null and void;

(d) Holding the election of petitioner as Speaker of said Legislative Assembly or Batasan Pampook,
Region XII held on March 12, 1987 valid and subsisting, and

(e) Making the injunction permanent.

Petitioner likewise prays for such other relief as may be just and equitable. 2

Pending further proceedings, this Court, on January 19, 1988, received a resolution filed by the
Sangguniang Pampook, "EXPECTING ALIMBUSAR P. LIMBONA FROM MEMBERSHIP OF THE
SANGGUNIANG PAMPOOK AUTONOMOUS REGION XII," 3 on the grounds, among other things, that the
petitioner "had caused to be prepared and signed by him paying [sic] the salaries and emoluments of Odin
Abdula, who was considered resigned after filing his Certificate of Candidacy for Congressmen for the First
District of Maguindanao in the last May 11, elections. . . and nothing in the record of the Assembly will show
that any request for reinstatement by Abdula was ever made . . ." 4 and that "such action of Mr. Lim bona in
paying Abdula his salaries and emoluments without authority from the Assembly . . . constituted a usurpation
of the power of the Assembly," 5 that the petitioner "had recently caused withdrawal of so much amount of
cash from the Assembly resulting to the non-payment of the salaries and emoluments of some Assembly
[sic]," 6 and that he had "filed a case before the Supreme Court against some members of the Assembly on
question which should have been resolved within the confines of the Assembly," 7 for which the respondents
now submit that the petition had become "moot and academic". 8

The first question, evidently, is whether or not the expulsion of the petitioner (pending litigation) has made
the case moot and academic.

We do not agree that the case has been rendered moot and academic by reason simply of the expulsion
resolution so issued. For, if the petitioner's expulsion was done purposely to make this petition moot and
academic, and to preempt the Court, it will not make it academic.

On the ground of the immutable principle of due process alone, we hold that the expulsion in question is of
no force and effect. In the first place, there is no showing that the Sanggunian had conducted an
investigation, and whether or not the petitioner had been heard in his defense, assuming that there was an
investigation, or otherwise given the opportunity to do so. On the other hand, what appears in the records is
an admission by the Assembly (at least, the respondents) that "since November, 1987 up to this writing, the
petitioner has not set foot at the Sangguniang Pampook." 9 "To be sure, the private respondents aver that
"[t]he Assemblymen, in a conciliatory gesture, wanted him to come to Cotabato City," 10 but that was "so
that their differences could be threshed out and settled." 11 Certainly, that avowed wanting or desire to
thresh out and settle, no matter how conciliatory it may be cannot be a substitute for the notice and hearing
contemplated by law.

While we have held that due process, as the term is known in administrative law, does not absolutely require
notice and that a party need only be given the opportunity to be heard, 12 it does not appear herein that the
petitioner had, to begin with, been made aware that he had in fact stood charged of graft and corruption
before his collegues. It cannot be said therefore that he was accorded any opportunity to rebut their
accusations. As it stands, then, the charges now levelled amount to mere accusations that cannot warrant
expulsion.

In the second place, (the resolution) appears strongly to be a bare act of vendetta by the other
Assemblymen against the petitioner arising from what the former perceive to be abduracy on the part of the
latter. Indeed, it (the resolution) speaks of "a case [having been filed] [by the petitioner] before the Supreme
Court . . . on question which should have been resolved within the confines of the Assemblyman act which
some members claimed unnecessarily and unduly assails their integrity and character as representative of
the people" 13 an act that cannot possibly justify expulsion. Access to judicial remedies is guaranteed by the
Constitution, 14 and, unless the recourse amounts to malicious prosecution, no one may be punished for
seeking redress in the courts.

We therefore order reinstatement, with the caution that should the past acts of the petitioner indeed warrant
his removal, the Assembly is enjoined, should it still be so minded, to commence proper proceedings
therefor in line with the most elementary requirements of due process. And while it is within the discretion of
the members of the Sanggunian to punish their erring colleagues, their acts are nonetheless subject to the
moderating band of this Court in the event that such discretion is exercised with grave abuse.

It is, to be sure, said that precisely because the Sangguniang Pampook(s) are "autonomous," the courts
may not rightfully intervene in their affairs, much less strike down their acts. We come, therefore, to the
second issue: Are the so-called autonomous governments of Mindanao, as they are now constituted, subject
to the jurisdiction of the national courts? In other words, what is the extent of self-government given to the
two autonomous governments of Region IX and XII?

The autonomous governments of Mindanao were organized in Regions IX and XII by Presidential Decree
No. 1618 15 promulgated on July 25, 1979. Among other things, the Decree established "internal autonomy"
16 in the two regions "[w]ithin the framework of the national sovereignty and territorial integrity of the
Republic of the Philippines and its Constitution," 17 with legislative and executive machinery to exercise the
powers and responsibilities 18 specified therein.
It requires the autonomous regional governments to "undertake all internal administrative matters for the
respective regions," 19 except to "act on matters which are within the jurisdiction and competence of the
National Government," 20 "which include, but are not limited to, the following:

(1) National defense and security;

(2) Foreign relations;

(3) Foreign trade;

(4) Currency, monetary affairs, foreign exchange, banking and quasi-banking, and external borrowing,

(5) Disposition, exploration, development, exploitation or utilization of all natural resources;

(6) Air and sea transport

(7) Postal matters and telecommunications;

(8) Customs and quarantine;

(9) Immigration and deportation;

(10) Citizenship and naturalization;

(11) National economic, social and educational planning; and

(12) General auditing. 21

In relation to the central government, it provides that "[t]he President shall have the power of general
supervision and control over the Autonomous Regions ..." 22

Now, autonomy is either decentralization of administration or decentralization of power. There is

decentralization of administration when 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," 23 "and ensure their fullest development as self-reliant
communities and make them more effective partners in the pursuit of national development and social
progress." 24 At the same time, it relieves the central government of the burden of managing local affairs
and enables it to concentrate on national concerns. The President exercises "general supervision" 25 over
them, but only to "ensure that local affairs are administered according to law." 26 He has no control over
their acts in the sense that he can substitute their judgments with his own. 27

Decentralization of power, on the other hand, involves an abdication of political power in the favor of local
governments units declare to be autonomous . In that case, the autonomous government is free to chart its
own destiny and shape its future with minimum intervention from central authorities. According to a
constitutional author, decentralization of power amounts to "self-immolation," since in that event, the
autonomous government becomes accountable not to the central authorities but to its constituency. 28

But the question of whether or not the grant of autonomy Muslim Mindanao under the 1987 Constitution
involves, truly, an effort to decentralize power rather than mere administration is a question foreign to this
petition, since what is involved herein is a local government unit constituted prior to the ratification of the
present Constitution. Hence, the Court will not resolve that controversy now, in this case, since no
controversy in fact exists. We will resolve it at the proper time and in the proper case.

Under the 1987 Constitution, local government units enjoy autonomy in these two senses, thus:

Section 1. The territorial and political subdivisions of the Republic of the Philippines are the provinces, cities,
municipalities, and barangays. Here shall be autonomous regions in Muslim Mindanao ,and the Cordilleras
as hereinafter provided. 29

Sec. 2. The territorial and political subdivisions shall enjoy local autonomy. 30

xxx xxx xxx

See. 15. Mere shall be created autonomous regions in Muslim Mindanao and in the Cordilleras consisting of
provinces, cities, municipalities, and geographical areas sharing common and distinctive historical and
cultural heritage, economic and social structures, and other relevant characteristics within the framework of
this Constitution and the national sovereignty as well as territorial integrity of the Republic of the Philippines.
31

An autonomous government that enjoys autonomy of the latter category [CONST. (1987), art. X, sec. 15.] is
subject alone to the decree of the organic act creating it and accepted principles on the effects and limits of
"autonomy." On the other hand, an autonomous government of the former class is, as we noted, under the
supervision of the national government acting through the President (and the Department of Local
Government). 32 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 that they were never meant to exercise autonomy in
the second sense, that is, in which the central government commits an act of self-immolation. Presidential
Decree No. 1618, in the first place, mandates that "[t]he President shall have the power of general
supervision and control over Autonomous Regions."33 In the second place, the Sangguniang Pampook,
their legislative arm, is made to discharge chiefly administrative services, thus:

SEC. 7. Powers of the Sangguniang Pampook. The Sangguniang Pampook shall exercise local legislative
powers over regional affairs within the framework of national development plans, policies and goals, in the
following areas:

(1) Organization of regional administrative system;

(2) Economic, social and cultural development of the Autonomous Region;

(3) Agricultural, commercial and industrial programs for the Autonomous Region;

(4) Infrastructure development for the Autonomous Region;

(5) Urban and rural planning for the Autonomous Region;

(6) Taxation and other revenue-raising measures as provided for in this Decree;

(7) Maintenance, operation and administration of schools established by the Autonomous Region;

(8) Establishment, operation and maintenance of health, welfare and other social services, programs and
facilities;

(9) Preservation and development of customs, traditions, languages and culture indigenous to the
Autonomous Region; and

(10) Such other matters as may be authorized by law,including the enactment of such measures as may
be necessary for the promotion of the general welfare of the people in the Autonomous Region.

The President shall exercise such powers as may be necessary to assure that enactment and acts of the
Sangguniang Pampook and the Lupong Tagapagpaganap ng Pook are in compliance with this Decree,
national legislation, policies, plans and programs.

The Sangguniang Pampook shall maintain liaison with the Batasang Pambansa. 34

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.

Briefly, the petitioner assails the legality of his ouster as Speaker on the grounds that: (1) the Sanggunian, in
convening on November 2 and 5, 1987 (for the sole purpose of declaring the office of the Speaker vacant),
did so in violation of the Rules of the Sangguniang Pampook since the Assembly was then on recess; and
(2) assuming that it was valid, his ouster was ineffective nevertheless for lack of quorum.

Upon the facts presented, we hold that the November 2 and 5, 1987 sessions were invalid. It is true that
under Section 31 of the Region XII Sanggunian Rules, "[s]essions shall not be suspended or adjourned
except by direction of the Sangguniang Pampook," 35 but it provides likewise that "the Speaker may, on [sic]
his discretion, declare a recess of "short intervals." 36 Of course, there is disagreement between the
protagonists as to whether or not the recess called by the petitioner effective November 1 through 15, 1987
is the "recess of short intervals" referred to; the petitioner says that it is while the respondents insist that, to
all intents and purposes, it was an adjournment and that "recess" as used by their Rules only refers to "a
recess when arguments get heated up so that protagonists in a debate can talk things out informally and
obviate dissenssion [sic] and disunity. 37 The Court agrees with the respondents on this regard, since
clearly, the Rules speak of "short intervals." Secondly, the Court likewise agrees that the Speaker could not
have validly called a recess since the Assembly had yet to convene on November 1, the date session opens
under the same Rules. 38 Hence, there can be no recess to speak of that could possibly interrupt any
session. But while 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 by the Committee on Muslim Affairs of the House
of Representatives provided a plausible reason for the intermission sought. Thirdly, assuming that a valid
recess could not be called, it does not appear that the respondents called his attention to this mistake. What
appears is that instead, they opened the sessions themselves behind his back in an apparent act of mutiny.
Under the circumstances, we find equity on his side. For this reason, we uphold the "recess" called on the
ground of good faith.

It does not appear to us, moreover, that the petitioner had resorted to the aforesaid "recess" in order to
forestall the Assembly from bringing about his ouster. This is not apparent from the pleadings before us. We
are convinced that the invitation was what precipitated it.

In holding that the "recess" in question is valid, we are not to be taken as establishing a precedent, since, as
we said, a recess can not be validly declared without a session having been first opened. In upholding the
petitioner herein, we are not giving him a carte blanche to order recesses in the future in violation of the
Rules, or otherwise to prevent the lawful meetings thereof.

Neither are we, by this disposition, discouraging the Sanggunian from reorganizing itself pursuant to its
lawful prerogatives. Certainly, it can do so at the proper time. In the event that be petitioner should initiate
obstructive moves, the Court is certain that it is armed with enough coercive remedies to thwart them. 39

In view hereof, we find no need in dwelling on the issue of quorum.

WHEREFORE, premises considered, the petition is GRANTED. The Sangguniang Pampook, Region XII, is
ENJOINED to (1) REINSTATE the petitioner as Member, Sangguniang Pampook, Region XII; and (2)
REINSTATE him as Speaker thereof. No costs.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 111097 July 20, 1994

MAYOR PABLO P. MAGTAJAS & THE CITY OF CAGAYAN DE ORO, petitioners,

vs.
PRYCE PROPERTIES CORPORATION, INC. & PHILIPPINE AMUSEMENT AND GAMING
CORPORATION, respondents.

Aquilino G. Pimentel, Jr. and Associates for petitioners.

R.R. Torralba & Associates for private respondent.

CRUZ, J.:

There was instant opposition when PAGCOR announced the opening of a casino in Cagayan de Oro City.
Civic organizations angrily denounced the project. The religious elements echoed the objection and so did
the women's groups and the youth. Demonstrations were led by the mayor and the city legislators. The
media trumpeted the protest, describing the casino as an affront to the welfare of the city.

The trouble arose when in 1992, flush with its tremendous success in several cities, 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., one of the herein private respondents, renovated and equipped the
same, and prepared to inaugurate its casino there during the Christmas season.

The reaction of the Sangguniang Panlungsod of Cagayan de Oro City was swift and hostile. On December
7, 1992, it enacted Ordinance No. 3353 reading as follows:

ORDINANCE NO. 3353

AN ORDINANCE PROHIBITING THE ISSUANCE OF BUSINESS PERMIT AND

CANCELLING EXISTING BUSINESS PERMIT TO ANY ESTABLISHMENT FOR THE
USING AND ALLOWING TO BE USED ITS PREMISES OR PORTION THEREOF FOR THE
OPERATION OF CASINO.

BE IT ORDAINED by the Sangguniang Panlungsod of the City of Cagayan de Oro, in

session assembled that:

Sec. 1. — That pursuant to the policy of the city banning the operation of casino within its
territorial jurisdiction, no business permit shall be issued to any person, partnership or
corporation for the operation of casino within the city limits.

Sec. 2. — That it shall be a violation of existing business permit by any persons, partnership
or corporation to use its business establishment or portion thereof, or allow the use thereof
by others for casino operation and other gambling activities.

Sec. 3. — PENALTIES. — Any violation of such existing business permit as defined in the
preceding section shall suffer the following penalties, to wit:

a) Suspension of the business permit for sixty (60) days for

the first offense and a fine of P1,000.00/day

b) Suspension of the business permit for Six (6) months for

the second offense, and a fine of P3,000.00/day

c) Permanent revocation of the business permit and

imprisonment of One (1) year, for the third and subsequent
offenses.

Sec. 4. — This Ordinance shall take effect ten (10) days from publication thereof.

Nor was this all. On January 4, 1993, it adopted a sterner Ordinance No. 3375-93 reading as follows:

ORDINANCE NO. 3375-93

AN ORDINANCE PROHIBITING THE OPERATION OF CASINO AND PROVIDING

PENALTY FOR VIOLATION THEREFOR.

WHEREAS, the City Council established a policy as early as 1990 against CASINO under its
Resolution No. 2295;

WHEREAS, on October 14, 1992, the City Council passed another Resolution No. 2673,
reiterating its policy against the establishment of CASINO;

WHEREAS, subsequently, thereafter, it likewise passed Ordinance No. 3353, prohibiting the
issuance of Business Permit and to cancel existing Business Permit to any establishment for
the using and allowing to be used its premises or portion thereof for the operation of
CASINO;

WHEREAS, under Art. 3, section 458, No. (4), sub paragraph VI of the Local Government
Code of 1991 (Rep. Act 7160) and under Art. 99, No. (4), Paragraph VI of the implementing
rules of the Local Government Code, the City Council as the Legislative Body shall enact
measure to suppress any activity inimical to public morals and general welfare of the people
and/or regulate or prohibit such activity pertaining to amusement or entertainment in order to
protect social and moral welfare of the community;

NOW THEREFORE,
 BE IT ORDAINED by the City Council in session duly assembled that:

Sec. 1. — The operation of gambling CASINO in the City of Cagayan de Oro is hereby
prohibited.

Sec. 2. — Any violation of this Ordinance shall be subject to the following penalties:

a) Administrative fine of P5,000.00 shall be imposed against the proprietor, partnership or

corporation undertaking the operation, conduct, maintenance of gambling CASINO in the
City and closure thereof;

b) Imprisonment of not less than six (6) months nor more than one (1) year or a fine in the
amount of P5,000.00 or both at the discretion of the court against the manager, supervisor,
and/or any person responsible in the establishment, conduct and maintenance of gambling
CASINO.

Sec. 3. — This Ordinance shall take effect ten (10) days after its publication in a local
newspaper of general circulation.

Pryce assailed the ordinances before the Court of Appeals, where it was joined by PAGCOR as intervenor
and supplemental petitioner. Their challenge succeeded. On March 31, 1993, the Court of Appeals declared
the ordinances invalid and issued the writ prayed for to prohibit their enforcement. 1 Reconsideration of this
decision was denied on July 13, 1993. 2

Cagayan de Oro City and its mayor are now before us in this petition for review under Rule 45 of the Rules
of Court. 3 They aver that the respondent Court of Appeals erred in holding that:

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. 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."

3. The questioned Ordinances in effect annul P.D. 1869 and are therefore invalid on that
point.

4. The questioned Ordinances are discriminatory to casino and partial to cockfighting and are
therefore invalid on that point.

5. The questioned Ordinances are not reasonable, not consonant with the general powers
and purposes of the instrumentality concerned and inconsistent with the laws or policy of the
State.

6. It had no option but to follow the ruling in the case of Basco, et al. v. PAGCOR, G.R. No.
91649, May 14, 1991, 197 SCRA 53 in disposing of the issues presented in this present
case.

PAGCOR is a corporation created directly by P.D. 1869 to help centralize and regulate all games of chance,
including casinos on land and sea within the territorial jurisdiction of the Philippines. In Basco v. Philippine
Amusements and Gaming Corporation, 4 this Court sustained the constitutionality of the decree and even
cited the benefits of the entity to the national economy as the third highest revenue-earner in the
government, next only to the BIR and the Bureau of Customs.

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 now embodied in Section 16 as follows:

Sec. 16. — General Welfare. — Every local government unit shall exercise the powers
expressly granted, those necessarily implied therefrom, as well as powers necessary,
appropriate, or incidental for its efficient and effective governance, and those which are
essential to the promotion of the general welfare. Within their respective territorial
jurisdictions, local government units shall ensure and support, among other things, the
preservation and enrichment of culture, promote health and safety, enhance the right of the
people to a balanced ecology, encourage and support the development of appropriate and
self-reliant scientific and technological capabilities, improve public morals, enhance
economic prosperity and social justice, promote full employment among their residents,
maintain peace and order, and preserve the comfort and convenience of their inhabitants.

In addition, Section 458 of the said Code specifically declares that:

 Sec. 458. — Powers, Duties, Functions and Compensation. — (a) The Sangguniang
Panlungsod, as the legislative body of the city, shall enact ordinances, approve resolutions
and appropriate funds for the general welfare of the city and its inhabitants pursuant to
Section 16 of this Code and in the proper exercise of the corporate powers of the city as
provided for under Section 22 of this Code, and shall:

(1) Approve ordinances and pass resolutions necessary for an efficient and effective city
government, and in this connection, shall:

xxx xxx xxx

(v) Enact ordinances intended to prevent, suppress and

impose appropriate penalties for habitual drunkenness in
public places, vagrancy, mendicancy, prostitution,
establishment and maintenance of houses of ill
repute, gamblingand other prohibited games of chance,
fraudulent devices and ways to obtain money or property,
drug addiction, maintenance of drug dens, drug pushing,
juvenile delinquency, the printing, distribution or exhibition of
obscene or pornographic materials or publications, and such
other activities inimical to the welfare and morals of the
inhabitants of the city;

This section also authorizes the local government units to regulate properties and businesses within their
territorial limits in the interest of the general welfare. 5

The petitioners argue that by virtue of these provisions, the Sangguniang Panlungsod may prohibit the
operation of casinos because they involve games of chance, which are detrimental to the people. Gambling
is not allowed by general law and even by the Constitution itself. The legislative power conferred upon local
government units may be exercised over all kinds of gambling and not only over "illegal gambling" as the
respondents erroneously argue. Even if the operation of casinos may have been permitted under P.D. 1869,
the government of Cagayan de Oro City has the authority to prohibit them within its territory pursuant to the
authority entrusted to it by the Local Government Code.

It is submitted that this interpretation is consonant with the policy of local autonomy as mandated in Article II,
Section 25, and Article X of the Constitution, as well as various other provisions therein seeking to
strengthen the character of the nation. In giving the local government units the power to prevent or suppress
gambling and other social problems, the Local Government Code has recognized the competence of such
communities to determine and adopt the measures best expected to promote the general welfare of their
inhabitants in line with the policies of the State.

The petitioners also stress that when the Code expressly authorized the local government units to prevent
and suppress gambling and other prohibited games of chance, like craps, baccarat, blackjack and roulette, it
meant allforms of gambling without distinction. Ubi lex non distinguit, nec nos distinguere
debemos. 6 Otherwise, it would have expressly excluded from the scope of their power casinos and other
forms of gambling authorized by special law, as it could have easily done. The fact that it did not do so
simply means that the local government units are permitted to prohibit all kinds of gambling within their
territories, including the operation of casinos.

The adoption of the Local Government Code, it is pointed out, had the effect of modifying the charter of the
PAGCOR. The Code is not only a later enactment than P.D. 1869 and so is deemed to prevail in case of
inconsistencies between them. More than this, the powers of the PAGCOR under the decree are expressly
discontinued by the Code insofar as they do not conform to its philosophy and provisions, pursuant to Par.
(f) of its repealing clause reading as follows:

(f) All general and special laws, acts, city charters, decrees, executive orders, proclamations
and administrative regulations, or part or parts thereof which are inconsistent with any of the
provisions of this Code are hereby repealed or modified accordingly.

It is also maintained that assuming there is doubt regarding the effect of the Local Government Code on
P.D. 1869, the doubt must be resolved in favor of the petitioners, in accordance with the direction in the
Code calling for its liberal interpretation in favor of the local government units. Section 5 of the Code
specifically provides:

Sec. 5. Rules of Interpretation. — In the interpretation of the provisions of this Code, the
following rules shall apply:

(a) Any provision on a power of a local government unit shall be liberally interpreted in its
favor, and in case of doubt, any question thereon shall be resolved in favor of devolution of
powers and of the lower local government unit. Any fair and reasonable doubt as to the
existence of the power shall be interpreted in favor of the local government unit concerned;
 xxx xxx xxx

(c) The general welfare provisions in this Code shall be liberally interpreted to give more
powers to local government units in accelerating economic development and upgrading the
quality of life for the people in the community; . . . (Emphasis supplied.)

Finally, the petitioners also attack gambling as intrinsically harmful and cite various provisions of the
Constitution and several decisions of this Court expressive of the general and official disapprobation of the
vice. They invoke the State policies on the family and the proper upbringing of the youth and, as might be
expected, call attention to the old case of U.S. v. Salaveria,7 which sustained a municipal ordinance
prohibiting the playing of panguingue. The petitioners decry the immorality of gambling. They also impugn
the wisdom of P.D. 1869 (which they describe as "a martial law instrument") in creating PAGCOR and
authorizing it to operate casinos "on land and sea within the territorial jurisdiction of the Philippines."

This is the opportune time to stress an important point.

The morality of gambling is not a justiciable issue. Gambling is not illegal per se. While it is generally
considered inimical to the interests of the people, there is nothing in the Constitution categorically
proscribing or penalizing gambling or, for that matter, even mentioning it at all. It is left to Congress to deal
with the activity as it sees fit. In the exercise of its own discretion, the legislature may prohibit gambling
altogether or allow it without limitation or it may prohibit some forms of gambling and allow others for
whatever reasons it may consider sufficient. Thus, it has prohibited jueteng and monte but permits lotteries,
cockfighting and horse-racing. In making such choices, Congress has consulted its own wisdom, which this
Court has no authority to review, much less reverse. Well has it been said that courts do not sit to resolve
the merits of conflicting theories. 8 That is the prerogative of the political departments. It is settled that
questions regarding the wisdom, morality, or practicibility of statutes are not addressed to the judiciary but
may be resolved only by the legislative and executive departments, to which the function belongs in our
scheme of government. That function is exclusive. Whichever way these branches decide, they are
answerable only to their own conscience and the constituents who will ultimately judge their acts, and not to
the courts of justice.

The only question we can and shall resolve in this petition is the validity of Ordinance No. 3355 and
Ordinance No. 3375-93 as enacted by the Sangguniang Panlungsod of Cagayan de Oro City. And we shall
do so only by the criteria laid down by law and not by our own convictions on the propriety of gambling.

The tests of a valid ordinance are well established. A long line of decisions 9 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.

We begin by observing that under Sec. 458 of the Local Government Code, local government units are
authorized to prevent or suppress, among others, "gambling and other prohibited games of chance."
Obviously, this provision excludes games of chance which are not prohibited but are in fact permitted by law.
The petitioners are less than accurate in claiming that the Code could have excluded such games of chance
but did not. In fact it does. The language of the section is clear and unmistakable. 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.

We could stop here as this interpretation should settle the problem quite conclusively. But we will not. The
vigorous efforts of the petitioners on behalf of the inhabitants of Cagayan de Oro City, and the earnestness
of their advocacy, deserve more than short shrift from this Court.

The apparent flaw in the ordinances in question is that they contravene P.D. 1869 and the public policy
embodied therein insofar as they prevent PAGCOR from exercising the power conferred on it to operate a
casino in Cagayan de Oro City. The petitioners have an ingenious answer to this misgiving. They deny that it
is the ordinances that have changed P.D. 1869 for an ordinance admittedly cannot prevail against a statute.
Their theory is that the change has been made by the Local Government Code itself, which was also
enacted by the national lawmaking authority. In their view, the decree has been, not really repealed by the
Code, but merely "modified pro tanto" in the sense that PAGCOR cannot now operate a casino over the
objection of the local government unit concerned. This modification of P.D. 1869 by the Local Government
Code is permissible because one law can change or repeal another law.

It seems to us that the petitioners are playing with words. While insisting that the decree has only been
"modifiedpro tanto," they are actually arguing that it is already dead, repealed and useless for all intents and
purposes because the Code has shorn PAGCOR of all power to centralize and regulate casinos. Strictly
speaking, its operations may now be not only prohibited by the local government unit; in fact, the prohibition
is not only discretionary but mandated by Section 458 of the Code if the word "shall" as used therein is to be
given its accepted meaning. Local government units have now no choice but to prevent and suppress
gambling, which in the petitioners' view includes both legal and illegal gambling. Under this construction,
PAGCOR will have no more games of chance to regulate or centralize as they must all be prohibited by the
local government units pursuant to the mandatory duty imposed upon them by the Code. In this situation,
PAGCOR cannot continue to exist except only as a toothless tiger or a white elephant and will no longer be
able to exercise its powers as a prime source of government revenue through the operation of casinos.

It is noteworthy that the petitioners have cited only Par. (f) of the repealing clause, conveniently discarding
the rest of the provision which painstakingly mentions the specific laws or the parts thereof which are
repealed (or modified) by the Code. Significantly, P.D. 1869 is not one of them. A reading of the entire
repealing clause, which is reproduced below, will disclose the omission:

Sec. 534. Repealing Clause. — (a) Batas Pambansa Blg. 337, otherwise known as the
"Local Government Code," Executive Order No. 112 (1987), and Executive Order No. 319
(1988) are hereby repealed.

(b) Presidential Decree Nos. 684, 1191, 1508 and such other decrees, orders, instructions,
memoranda and issuances related to or concerning the barangay are hereby repealed.

(c) The provisions of Sections 2, 3, and 4 of Republic Act No. 1939 regarding hospital fund;
Section 3, a (3) and b (2) of Republic Act. No. 5447 regarding the Special Education Fund;
Presidential Decree No. 144 as amended by Presidential Decree Nos. 559 and 1741;
Presidential Decree No. 231 as amended; Presidential Decree No. 436 as amended by
Presidential Decree No. 558; and Presidential Decree Nos. 381, 436, 464, 477, 526, 632,
752, and 1136 are hereby repealed and rendered of no force and effect.

(d) Presidential Decree No. 1594 is hereby repealed insofar as it governs locally-funded
projects.

(e) The following provisions are hereby repealed or amended insofar as they are inconsistent
with the provisions of this Code: Sections 2, 16, and 29 of Presidential Decree No. 704;
Sections 12 of Presidential Decree No. 87, as amended; Sections 52, 53, 66, 67, 68, 69, 70,
71, 72, 73, and 74 of Presidential Decree No. 463, as amended; and Section 16 of
Presidential Decree No. 972, as amended, and

(f) All general and special laws, acts, city charters, decrees, executive orders, proclamations
and administrative regulations, or part or parts thereof which are inconsistent with any of the
provisions of this Code are hereby repealed or modified accordingly.

Furthermore, it is a familiar rule that implied repeals are not lightly presumed in the absence of a clear and
unmistakable showing of such intention. In Lichauco & Co. v. Apostol, 10 this Court explained:

The cases relating to the subject of repeal by implication all proceed on the assumption that
if the act of later date clearly reveals an intention on the part of the lawmaking power to
abrogate the prior law, this intention must be given effect; but there must always be a
sufficient revelation of this intention, and it has become an unbending rule of statutory
construction that the intention to repeal a former law will not be imputed to the Legislature
when it appears that the two statutes, or provisions, with reference to which the question
arises bear to each other the relation of general to special.

There is no sufficient indication of an implied repeal of P.D. 1869. On the contrary, as the private respondent
points out, PAGCOR is mentioned as the source of funding in two later enactments of Congress, to wit, R.A.
7309, creating a Board of Claims under the Department of Justice for the benefit of victims of unjust
punishment or detention or of violent crimes, and R.A. 7648, providing for measures for the solution of the
power crisis. PAGCOR revenues are tapped by these two statutes. This would show that the PAGCOR
charter has not been repealed by the Local Government Code but has in fact been improved as it were to
make the entity more responsive to the fiscal problems of the government.

It is a canon of legal hermeneutics that instead of pitting one statute against another in an inevitably
destructive confrontation, courts must exert every effort to reconcile them, remembering that both laws
deserve a becoming respect as the handiwork of a coordinate branch of the government. On the assumption
of a conflict between P.D. 1869 and the Code, the proper action is not to uphold one and annul the other but
to give effect to both by harmonizing them if possible. This is possible in the case before us. The proper
resolution of the problem at hand is to hold that under the Local Government Code, local government units
may (and indeed must) prevent and suppress all kinds of gambling within their territories except only those
allowed by statutes like P.D. 1869. The exception reserved in such laws must be read into the Code, to
make both the Code and such laws equally effective and mutually complementary.

This approach would also affirm that there are indeed two kinds of gambling, to wit, the illegal and those
authorized by law. Legalized gambling is not a modern concept; it is probably as old as illegal gambling, if
not indeed more so. The petitioners' suggestion that the Code authorizes them to prohibit all kinds of
gambling would erase the distinction between these two forms of gambling without a clear indication that this
is the will of the legislature. Plausibly, following this theory, the City of Manila could, by mere ordinance,
prohibit the Philippine Charity Sweepstakes Office from conducting a lottery as authorized by R.A. 1169 and
B.P. 42 or stop the races at the San Lazaro Hippodrome as authorized by R.A. 309 and R.A. 983.

In light of all the above considerations, we see no way of arriving at the conclusion urged on us by the
petitioners that the ordinances in question are valid. On the contrary, we find that the ordinances violate P.D.
1869, which has the character and force of a statute, as well as the public policy expressed in the decree
allowing the playing of certain games of chance despite the prohibition of gambling in general.

The rationale of the requirement that the ordinances should not contravene a statute is obvious. Municipal
governments are only agents of the national government. Local councils exercise only delegated legislative
powers conferred on them by Congress as the national lawmaking body. The delegate cannot be superior to
the principal or exercise powers higher than those of the latter. 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 mere ordinance the mandate of the statute.

Municipal corporations owe their origin to, and derive their powers and rights wholly from the
legislature. It breathes into them the breath of life, without which they cannot exist. As it
creates, so it may destroy. As it may destroy, it may abridge and control. Unless there is
some constitutional limitation on the right, the legislature might, by a single act, and if we can
suppose it capable of so great a folly and so great a wrong, sweep from existence all of the
municipal corporations in the State, and the corporation could not prevent it. We know of no
limitation on the right so far as to the corporation themselves are concerned. They are, so to
phrase it, the mere tenants at will of the legislature. 11

This basic relationship between the national legislature and the local government units has not been
enfeebled by the new provisions in the Constitution strengthening the policy of local autonomy. Without
meaning to detract from that policy, we here confirm that Congress retains control of the local government
units although in significantly reduced degree now than under our previous Constitutions. The power to
create still includes the power to destroy. The power to grant still includes the power to withhold or recall.
True, there are certain notable innovations in the Constitution, like the direct conferment on the local
government units of the power to tax, 12 which cannot now be withdrawn by mere statute. By and large,
however, the national legislature is still the principal of the local government units, which cannot defy its will
or modify or violate it.

The Court understands and admires the concern of the petitioners for the welfare of their constituents and
their apprehensions that the welfare of Cagayan de Oro City will be endangered by the opening of the
casino. We share the view that "the hope of large or easy gain, obtained without special effort, turns the
head of the workman" 13 and that "habitual gambling is a cause of laziness and ruin." 14 In People v.
Gorostiza, 15 we declared: "The social scourge of gambling must be stamped out. The laws against gambling
must be enforced to the limit." George Washington called gambling "the child of avarice, the brother of
iniquity and the father of mischief." Nevertheless, we must recognize the power of the legislature to decide,
in its own wisdom, to legalize certain forms of gambling, as was done in P.D. 1869 and impliedly affirmed in
the Local Government Code. That decision can be revoked by this Court only if it contravenes the
Constitution as the touchstone of all official acts. We do not find such contravention here.

We hold that the power of PAGCOR to centralize and regulate all games of chance, including casinos on
land and sea within the territorial jurisdiction of the Philippines, remains unimpaired. P.D. 1869 has not been
modified by the Local Government Code, which empowers the local government units to prevent or
suppress only those forms of gambling prohibited by law.

Casino gambling is authorized by P.D. 1869. This decree has the status of a statute that cannot be
amended or nullified by a mere ordinance. Hence, it was not competent for the Sangguniang Panlungsod of
Cagayan de Oro City to enact Ordinance No. 3353 prohibiting the use of buildings for the operation of a
casino and Ordinance No. 3375-93 prohibiting the operation of casinos. For all their praiseworthy motives,
these ordinances are contrary to P.D. 1869 and the public policy announced therein and are therefore ultra
vires and void.

WHEREFORE, the petition is DENIED and the challenged decision of the respondent Court of Appeals is
AFFIRMED, with costs against the petitioners. It is so ordered.

Narvasa, C.J., Feliciano, Bidin, Regalado, Romero, Bellosillo, Melo, Quiason, Puno, Vitug, Kapunan
and Mendoza, JJ., concur.
G.R. No. 129093 August 30, 2001

HON. JOSE D. LINA, JR., SANGGUNIANG PANLALAWIGAN OF LAGUNA, and HON.

CALIXTO CATAQUIZ, petitioners,
vs.
HON. FRANCISCO DIZON PAÑO and TONY CALVENTO, respondents.

QUISUMBING, J.:

For our resolution is a petition for review on certiorari seeking the reversal of the decision 1
dated February 10, 1997 of the Regional Trial Court of San Pedro, Laguna, Branch 93,
enjoining petitioners from implementing or enforcing Kapasiyahan Bilang 508, Taon 1995, of
the Sangguniang Panlalawigan of Laguna and its subsequent Order 2 dated April 21, 1997
denying petitioners' motion for reconsideration.

On December 29, 1995, respondent Tony Calvento was appointed agent by the Philippine
Charity Sweepstakes Office (PCSO) to install Terminal OM 20 for the operation of lotto. He
asked Mayor Calixto Cataquiz, Mayor of San Pedro, Laguna, for a mayor's permit to open the
lotto outlet. This was denied by Mayor Cataquiz in a letter dated February 19, 1996. The
ground for said denial was an ordinance passed by the Sangguniang Panlalawigan of Laguna
entitled Kapasiyahan Blg. 508, T. 1995 which was issued on September 18, 1995. The
ordinance reads:

ISANG KAPASIYAHAN TINUTUTULAN ANG MGA "ILLEGAL GAMBLING" LALO NA ANG

LOTTO SA LALAWIGAN NG LAGUNA

SAPAGKA'T, ang sugal dito sa lalawigan ng Laguna ay talamak na;

SAPAGKA'T, ang sugal ay nagdudulot ng masasamang impluwensiya lalo't higit sa mga

kabataan;

KUNG KAYA'T DAHIL DITO, at sa mungkahi nina Kgg. Kgd. Juan M. Unico at Kgg. Kgd. Gat-
Ala A. Alatiit, pinangalawahan ni Kgg. Kgd. Meliton C. Larano at buong pagkakaisang
sinangayunan ng lahat ng dumalo sa pulong;

IPINASIYA, na tutulan gaya ng dito ay mahigpit na TINUTUTULAN ang ano mang uri ng sugal
dito sa lalawigan ng Laguna lalo't higit ang Lotto;

IPINASIYA PA RIN na hilingin tulad ng dito ay hinihiling sa Panlalawigang pinuno ng Philippine

National Police (PNP) Col. [illegible] na mahigpit na pag-ibayuhin ang pagsugpo sa lahat ng uri
ng illegal na sugal sa buong lalawigan ng Laguna lalo na ang "Jueteng".3

As a result of this resolution of denial, respondent Calvento filed a complaint for declaratory
relief with prayer for preliminary injunction and temporary restraining order. In the said
complaint, respondent Calvento asked the Regional Trial Court of San Pedro Laguna, Branch
93, for the following reliefs: (1) a preliminary injunction or temporary restraining order, ordering
the defendants to refrain from implementing or enforcing Kapasiyahan Blg. 508, T. 1995; (2)
an order requiring Hon. Municipal Mayor Calixto R Cataquiz to issue a business permit for the
operation of a lotto outlet; and (3) an order annulling or declaring as invalid Kapasiyahan Blg.
508, T. 1995.

On February 10, 1997, the respondent judge, Francisco Dizon Paño, promulgated his decision
enjoining the petitioners from implementing or enforcing resolution or Kapasiyahan Blg. 508, T.
1995. The dispositive portion of said decision reads:

WHEREFORE, premises considered, defendants, their agents and representatives are hereby
enjoined from implementing or enforcing resolution or kapasiyahan blg. 508, T. 1995 of the
Sangguniang Panlalawigan ng Laguna prohibiting the operation of the lotto in the province of
Laguna.

SO ORDERED.4

Petitioners filed a motion for reconsideration which was subsequently denied in an Order dated
April 21, 1997, which reads:

Acting on the Motion for Reconsideration filed by defendants Jose D. Lina, Jr. and the
Sangguniang Panlalawigan of Laguna, thru counsel, with the opposition filed by plaintiff's
counsel and the comment thereto filed by counsel for the defendants which were duly noted,
the Court hereby denies the motion for lack of merit.

SO ORDERED.5

On May 23, 1997, petitioners filed this petition alleging that the following errors were
committed by the respondent trial court:

THE TRIAL COURT ERRED IN ENJOINING THE PETITIONERS FROM IMPLEMENTING

KAPASIYAHAN BLG. 508, T. 1995 OF THE SANGGUNIANG PANLALAWIGAN OF LAGUNA
PROHIBITING THE OPERATION OF THE LOTTO IN THE PROVINCE OF LAGUNA.

II

THE TRIAL COURT FAILED TO APPRECIATE THE ARGUMENT POSITED BY THE

PETITIONERS THAT BEFORE ANY GOVERNMENT PROJECT OR PROGRAM MAY BE
IMPLEMENTED BY THE NATIONAL AGENCIES OR OFFICES, PRIOR CONSULTATION
AND APPROVAL BY THE LOCAL GOVERNMENT UNITS CONCERNED AND OTHER
CONCERNED SECTORS IS REQUIRED.

Petitioners contend that the assailed resolution is a valid policy declaration of the Provincial
Government of Laguna of its vehement objection to the operation of lotto and all forms of
gambling. It is likewise a valid exercise of the provincial government's police power under the
General Welfare Clause of Republic Act 7160, otherwise known as the Local Government
Code of 1991.6 They also maintain that respondent's lotto operation is illegal because no prior
consultations and approval by the local government were sought before it was implemented
contrary to the express provisions of Sections 2 (c) and 27 of R.A. 7160.7

For his part, respondent Calvento argues that the questioned resolution is, in effect, a
curtailment of the power of the state since in this case the national legislature itself had already
declared lotto as legal and permitted its operations around the country.8 As for the allegation
that no prior consultations and approval were sought from the sangguniang panlalawigan of
Laguna, respondent Calvento contends this is not mandatory since such a requirement is
merely stated as a declaration of policy and not a self-executing provision of the Local
Government Code of 1991.9 He also states that his operation of the lotto system is legal
because of the authority given to him by the PCSO, which in turn had been granted a franchise
to operate the lotto by Congress.10

The Office of the Solicitor General (OSG), for the State, contends that the Provincial
Government of Laguna has no power to prohibit a form of gambling which has been authorized
by the national government.11 He argues that this is based on the principle that ordinances
should not contravene statutes as municipal governments are merely agents of the national
government. The local councils exercise only delegated legislative powers which have been
conferred on them by Congress. This being the case, these councils, as delegates, cannot be
superior to the principal or exercise powers higher than those of the latter. The OSG also adds
that the question of whether gambling should be permitted is for Congress to determine, taking
into account national and local interests. Since Congress has allowed the PCSO to operate
lotteries which PCSO seeks to conduct in Laguna, pursuant to its legislative grant of authority,
the province's Sangguniang Panlalawigan cannot nullify the exercise of said authority by
preventing something already allowed by Congress.

The issues to be resolved now are the following: (1) whether Kapasiyahan Blg. 508, T. 1995 of
the Sangguniang Panlalawigan of Laguna and the denial of a mayor's permit based thereon
are valid; and (2) whether prior consultations and approval by the concerned Sanggunian are
needed before a lotto system can be operated in a given local government unit.

The entire controversy stemmed from the refusal of Mayor Cataquiz to issue a mayor's permit
for the operation of a lotto outlet in favor of private respondent. According to the mayor, he
based his decision on an existing ordinance prohibiting the operation of lotto in the province of
Laguna. The ordinance, however, merely states the "objection" of the council to the said game.
It is but a mere policy statement on the part of the local council, which is not self-executing.
Nor could it serve as a valid ground to prohibit the operation of the lotto system in the province
of Laguna. Even petitioners admit as much when they stated in their petition that:

5.7. The terms of the Resolution and the validity thereof are express and clear. The
Resolution is a policy declaration of the Provincial Government of Laguna of its vehement
opposition and/or objection to the operation of and/or all forms of gambling including the Lotto
operation in the Province of Laguna.12

As a policy statement expressing the local government's objection to the lotto, such resolution
is valid. This is part of the local government's autonomy to air its views which may be contrary
to that of the national government's. However, this freedom to exercise contrary views does
not mean that local governments may actually enact ordinances that go against laws duly
enacted by Congress. Given this premise, the assailed resolution in this case could not and
should not be interpreted as a measure or ordinance prohibiting the operation of lotto.

The game of lotto is a game of chance duly authorized by the national government through an
Act of Congress. Republic Act 1169, as amended by Batas Pambansa Blg. 42, is the law
which grants a franchise to the PCSO and allows it to operate the lotteries. The pertinent
provision reads:

SECTION 1. The Philippine Charity Sweepstakes Office. — The Philippine Charity

Sweepstakes Office, hereinafter designated the Office, shall be the principal government
agency for raising and providing for funds for health programs, medical assistance and
services and charities of national character, and as such shall have the general powers
conferred in section thirteen of Act Numbered One thousand four hundred fifty-nine, as
amended, and shall have the authority:

A. To hold and conduct charity sweepstakes races, lotteries, and other similar activities, in
such frequency and manner, as shall be determined, and subject to such rules and regulations
as shall be promulgated by the Board of Directors.

This statute remains valid today. While lotto is clearly a game of chance, the national
government deems it wise and proper to permit it. Hence, the Sangguniang Panlalawigan of
Laguna, a local government unit, cannot issue a resolution or an ordinance that would seek to
prohibit permits. Stated otherwise, what the national legislature expressly allows by law, such
as lotto, a provincial board may not disallow by ordinance or resolution.
In our system of government, the power of local government units to legislate and enact
ordinances and resolutions is merely a delegated power coming from Congress. As held in
Tatel vs. Virac,13 ordinances should not contravene an existing statute enacted by Congress.
The reasons for this is obvious, as elucidated in Magtajas v. Pryce Properties Corp.14

Municipal governments are only agents of the national government. Local councils exercise
only delegated legislative powers conferred upon them by Congress as the national lawmaking
body. The delegate cannot be superior to the principal or exercise powers higher than those of
the latter. 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 mere
ordinance the mandate of the statute.

Municipal corporations owe their origin to, and derive their powers and rights wholly from the
legislature. It breathes into them the breath of life, without which they cannot exist. As it
creates, so it may destroy. As it may destroy, it may abridge and control. Unless there is some
constitutional limitation on the right, the legislature might, by a single act, and if we can
suppose it capable of so great a folly and so great a wrong, sweep from existence all of the
municipal corporations in the state, and the corporation could not prevent it. We know of no
limitation on the right so far as the corporation themselves are concerned. They are, so to
phrase it, the mere tenants at will of the legislature (citing Clinton vs. Ceder Rapids, etc.
Railroad Co., 24 Iowa 455).

Nothing in the present constitutional provision enhancing local autonomy dictates a different
conclusion.

The basic relationship between the national legislature and the local government units has not
been enfeebled by the new provisions in the Constitution strengthening the policy of local
autonomy. Without meaning to detract from that policy, we here confirm that Congress retains
control of the local government units although in significantly reduced degree now than under
our previous Constitutions. The power to create still includes the power to destroy. The power
to grant still includes the power to withhold or recall. True, there are certain notable innovations
in the Constitution, like the direct conferment on the local government units of the power to tax
(citing Art. X, Sec. 5, Constitution), which cannot now be withdrawn by mere statute. By and
large, however, the national legislature is still the principal of the local government units, which
cannot defy its will or modify or violate it.15

Ours is still a unitary form of government, not a federal state. Being so, any form of autonomy
granted to local governments will necessarily be limited and confined within the extent allowed
by the central authority. Besides, the principle of local autonomy under the 1987 Constitution
simply means "decentralization". It does not make local governments sovereign within the
state or an "imperium in imperio".16

To conclude our resolution of the first issue, respondent mayor of San Pedro, cannot avail of
Kapasiyahan Bilang 508, Taon 1995, of the Provincial Board of Laguna as justification to
prohibit lotto in his municipality. For said resolution is nothing but an expression of the local
legislative unit concerned. The Board's enactment, like spring water, could not rise above its
source of power, the national legislature.

As for the second issue, we hold that petitioners erred in declaring that Sections 2 (c) and 27
of Republic Act 7160, otherwise known as the Local Government Code of 1991, apply
mandatorily in the setting up of lotto outlets around the country. These provisions state:
SECTION 2. Declaration of Policy. — . . .

(c) It is likewise the policy of the State to require all national agencies and offices to
conduct periodic consultations with appropriate local government units, non-governmental and
people's organizations, and other concerned sectors of the community before any project or
program is implemented in their respective jurisdictions.

SECTION 27. Prior Consultations Required. — No project or program shall be

implemented by government authorities unless the consultations mentioned in Section 2 (c)
and 26 hereof are complied with, and prior approval of the sanggunian concerned is obtained;
Provided, that occupants in areas where such projects are to be implemented shall not be
evicted unless, appropriate relocation sites have been provided, in accordance with the
provisions of the Constitution.

From a careful reading of said provisions, we find that these apply only to national programs
and/or projects which are to be implemented in a particular local community. Lotto is neither a
program nor a project of the national government, but of a charitable institution, the PCSO.
Though sanctioned by the national government, it is far fetched to say that lotto falls within the
contemplation of Sections 2 (c) and 27 of the Local Government Code.

Section 27 of the Code should be read in conjunction with Section 26 thereof.17 Section 26
reads:

SECTION 26. Duty of National Government Agencies in the Maintenance of Ecological

Balance. - It shall be the duty of every national agency or government-owned or controlled
corporation authorizing or involved in the planning and implementation of any project or
program that may cause pollution, climatic change, depletion of non-renewable resources, loss
of crop land, range-land, or forest cover, and extinction of animal or plant species, to consult
with the local government units, nongovernmental organizations, and other sectors concerned
and explain the goals and objectives of the project or program, its impact upon the people and
the community in terms of environmental or ecological balance, and the measures that will be
undertaken to prevent or minimize the adverse effects thereof.

Thus, the projects and programs mentioned in Section 27 should be interpreted to mean
projects and programs whose effects are among those enumerated in Section 26 and 27, to
wit, those that: (1) may cause pollution; (2) may bring about climatic change; (3) may cause
the depletion of non-renewable resources; (4) may result in loss of crop land, range-land, or
forest cover; (5) may eradicate certain animal or plant species from the face of the planet; and
(6) other projects or programs that may call for the eviction of a particular group of people
residing in the locality where these will be implemented. Obviously, none of these effects will
be produced by the introduction of lotto in the province of Laguna.

Moreover, the argument regarding lack of consultation raised by petitioners is clearly an

afterthought on their part. There is no indication in the letter of Mayor Cataquiz that this was
one of the reasons for his refusal to issue a permit. That refusal was predicated solely but
erroneously on the provisions of Kapasiyahan Blg. 508, Taon 1995, of the Sangguniang
Panlalawigan of Laguna.

In sum, we find no reversible error in the RTC decision enjoining Mayor Cataquiz from
enforcing or implementing the Kapasiyahan Blg. 508, T. 1995, of the Sangguniang
Panlalawigan of Laguna. That resolution expresses merely a policy statement of the Laguna
provincial board. It possesses no binding legal force nor requires any act of implementation. It
provides no sufficient legal basis for respondent mayor's refusal to issue the permit sought by
private respondent in connection with a legitimate business activity authorized by a law passed
by Congress.

WHEREFORE, the petition is DENIED for lack of merit. The Order of the Regional Trial Court
of San Pedro, Laguna enjoining the petitioners from implementing or enforcing Resolution or
Kapasiyahan Blg. 508, T. 1995, of the Provincial Board of Laguna is hereby AFFIRMED. No
costs.

SO ORDERED.

G.R. No. 149743 February 18, 2005

LEONARDO TAN, ROBERT UY and LAMBERTO TE, petitioners,

vs.
SOCORRO Y. PEREÑA, Respondent.

DECISION

TINGA, J.:

The resolution of the present petition effectively settles the question of how many cockpits may
be allowed to operate in a city or municipality.

There are two competing values of high order that come to fore in this case—the traditional
power of the national government to enact police power measures, on one hand, and the
vague principle of local autonomy now enshrined in the Constitution on the other. The facts are
simple, but may be best appreciated taking into account the legal milieu which frames them.

In 1974, Presidential Decree (P.D.) No. 449, otherwise known as the Cockfighting Law of
1974, was enacted. Section 5(b) of the Decree provided for limits on the number of cockpits
that may be established in cities and municipalities in the following manner:

Section 5. Cockpits and Cockfighting in General. –

(b) Establishment of Cockpits. – Only one cockpit shall be allowed in each city or municipality,
except that in cities or municipalities with a population of over one hundred thousand, two
cockpits may be established, maintained and operated.

With the enactment of the Local Government Code of 1991,1 the municipal sangguniang
bayan were empowered, "[a]ny law to the contrary notwithstanding," to "authorize and license
the establishment, operation and maintenance of cockpits, and regulate cockfighting and
commercial breeding of gamecocks."2

In 1993, the Sangguniang Bayan of the municipality of Daanbantayan,3 Cebu Province,

enacted Municipal Ordinance No. 6 (Ordinance No. 6), Series of 1993, which served as the
Revised Omnibus Ordinance prescribing and promulgating the rules and regulations governing
cockpit operations in Daanbantayan.4 Section 5 thereof, relative to the number of cockpits
allowed in the municipality, stated:

Section 5. There shall be allowed to operate in the Municipality of Daanbantayan, Province of

Cebu, not more than its equal number of cockpits based upon the population provided for in
PD 449, provided however, that this specific section can be amended for purposes of
establishing additional cockpits, if the Municipal population so warrants.5

Shortly thereafter, the Sangguniang Bayan passed an amendatory ordinance, Municipal

Ordinance No. 7 (Ordinance No. 7), Series of 1993, which amended the aforequoted Section 5
to now read as follows:
Section 5. Establishment of Cockpit. There shall be allowed to operate in the Municipality of
Daanbantayan, Province of Cebu, not more than three (3) cockpits.6

On 8 November 1995, petitioner Leonardo Tan (Tan) applied with the Municipal Gamefowl
Commission for the issuance of a permit/license to establish and operate a cockpit in Sitio
Combado, Bagay, in Daanbantayan. At the time of his application, there was already another
cockpit in operation in Daanbantayan, operated by respondent Socorro Y. Pereña (Pereña),
who was the duly franchised and licensed cockpit operator in the municipality since the 1970s.
Pereña’s franchise, per records, was valid until 2002.7

The Municipal Gamefowl Commission favorably recommended to the mayor of Daanbantayan,

petitioner Lamberto Te (Te), that a permit be issued to Tan. On 20 January 1996, Te issued a
mayor’s permit allowing Tan "to establish/operate/conduct" the business of a cockpit in
Combado, Bagay, Daanbantayan, Cebu for the period from 20 January 1996 to 31 December
1996.8

This act of the mayor served as cause for Pereña to file a Complaint for damages with a prayer
for injunction against Tan, Te, and Roberto Uy, the latter allegedly an agent of Tan.9 Pereña
alleged that there was no lawful basis for the establishment of a second cockpit. She claimed
that Tan conducted his cockpit fights not in Combado, but in Malingin, at a site less than five
kilometers away from her own cockpit. She insisted that the unlawful operation of Tan’s cockpit
has caused injury to her own legitimate business, and demanded damages of at least Ten
Thousand Pesos (₱10,000.00) per month as actual damages, One Hundred Fifty Thousand
Pesos (₱150,000.00) as moral damages, and Fifty Thousand Pesos (₱50,000.00) as
exemplary damages. Pereña also prayed that the permit issued by Te in favor of Tan be
declared as null and void, and that a permanent writ of injunction be issued against Te and
Tan preventing Tan from conducting cockfights within the municipality and Te from issuing any
authority for Tan to pursue such activity.10

The case was heard by the Regional Trial Court (RTC),11 Branch 61 of Bogo, Cebu, which
initially granted a writ of preliminary injunction.12 During trial, herein petitioners asserted that
under the Local Government Code of 1991, the sangguniang bayan of each municipality now
had the power and authority to grant franchises and enact ordinances authorizing the
establishment, licensing, operation and maintenance of cockpits.13 By virtue of such authority,
the Sangguniang Bayan of Daanbantayan promulgated Ordinance Nos. 6 and 7. On the other
hand, Pereña claimed that the amendment authorizing the operation of not more than three (3)
cockpits in Daanbantayan violated Section 5(b) of the Cockfighting Law of 1974, which allowed
for only one cockpit in a municipality with a population as Daanbantayan.14

In a Decision dated 10 March 1997, the RTC dismissed the complaint. The court observed that
Section 5 of Ordinance No. 6, prior to its amendment, was by specific provision, an
implementation of the Cockfighting Law.15 Yet according to the RTC, questions could be
raised as to the efficacy of the subsequent amendment under Ordinance No. 7, since under
the old Section 5, an amendment allowing additional cockpits could be had only "if the
municipal population so warrants."16 While the RTC seemed to doubt whether this condition
had actually been fulfilled, it nonetheless declared that since the case was only for damages,
"the [RTC] cannot grant more relief than that prayed for."17 It ruled that there was no
evidence, testimonial or documentary, to show that plaintiff had actually suffered damages.
Neither was there evidence that Te, by issuing the permit to Tan, had acted in bad faith, since
such issuance was pursuant to municipal ordinances that nonetheless remained in force.18
Finally, the RTC noted that the assailed permit had expired on 31 December 1996, and there
was no showing that it had been renewed.19

Pereña filed a Motion for Reconsideration which was denied in an Order dated 24 February
1998. In this Order, the RTC categorically stated that Ordinance Nos. 6 and 7 were "valid and
legal for all intents and purpose[s]."20 The RTC also noted that the Sangguniang Bayan had
also promulgated Resolution No. 78-96, conferring on Tan a franchise to operate a cockpit for
a period of ten (10) years from February 1996 to 2006.21 This Resolution was likewise
affirmed as valid by the RTC. The RTC noted that while the ordinances seemed to be in
conflict with the Cockfighting Law, any doubt in interpretation should be resolved in favor of the
grant of more power to the local government unit, following the principles of devolution under
the Local Government Code.22

The Decision and Order of the RTC were assailed by Pereña on an appeal with the Court of
Appeals which on 21 May 2001, rendered the Decision now assailed.23 The perspective from
which the Court of Appeals viewed the issue was markedly different from that adopted by the
RTC. Its analysis of the Local Government Code, particularly Section 447(a)(3)(V), was that
the provision vesting unto the sangguniang bayan the power to authorize and license the
establishment of cockpits did not do away with the Cockfighting Law, as these two laws are not
necessarily inconsistent with each other. What the provision of the Local Government Code
did, according to the Court of Appeals, was to transfer to the sangguniang bayan powers that
were previously conferred on the Municipal Gamefowl Commission.24

Given these premises, the appellate court declared as follows:

Ordinance No. 7 should [be] held invalid for allowing, in unconditional terms, the operation of
"not more than three cockpits in Daan Bantayan" (sic), clearly dispensing with the standard set
forth in PD 449. However, this issue appears to have been mooted by the expiration of the
Mayor’s Permit granted to the defendant which has not been renewed.25

As to the question of damages, the Court of Appeals agreed with the findings of the RTC that
Pereña was not entitled to damages. Thus, it affirmed the previous ruling denying the claim for
damages. However, the Court of Appeals modified the RTC’s Decision in that it now ordered
that Tan be enjoined from operating a cockpit and conducting any cockfights within
Daanbantayan.26

Thus, the present Petition for Review on Certiorari.

Petitioners present two legal questions for determination: whether the Local Government Code
has rendered inoperative the Cockfighting Law; and whether the validity of a municipal
ordinance may be determined in an action for damages which does not even contain a prayer
to declare the ordinance invalid.27 As the denial of the prayer for damages by the lower court
is not put in issue before this Court, it shall not be passed upon on review.

The first question raised is particularly interesting, and any definitive resolution on that point
would have obvious ramifications not only to Daanbantayan, but all other municipalities and
cities. However, we must first determine the proper scope of judicial inquiry that we could
engage in, given the nature of the initiatory complaint and the rulings rendered thereupon, the
exact point raised in the second question.

Petitioners claim that the Court of Appeals, in declaring Ordinance No. 7 as invalid, embarked
on an unwarranted collateral attack on the validity of a municipal ordinance.28 Pereña’s
complaint, which was for damages with preliminary injunction, did not pray for the nullity of
Ordinance No. 7. The Municipality of Daanbantayan as a local government unit was not made
a party to the case, nor did any legal counsel on its behalf enter any appearance. Neither was
the Office of the Solicitor General given any notice of the case.29
These concerns are not trivial.30 Yet, we must point out that the Court of Appeals did not
expressly nullify Ordinance No. 7, or any ordinance for that matter. What the appellate court
did was to say that Ordinance No. 7 "should therefore be held invalid" for being in violation of
the Cockfighting Law.31 In the next breath though, the Court of Appeals backtracked, saying
that "this issue appears to have been mooted by the expiration of the Mayor’s Permit granted"
to Tan.32

But our curiosity is aroused by the dispositive portion of the assailed Decision, wherein the
Court of Appeals enjoined Tan "from operating a cockpit and conducting any cockfights within"
Daanbantayan.33 Absent the invalidity of Ordinance No. 7, there would be no basis for this
injunction. After all, any future operation of a cockpit by Tan in Daanbantayan, assuming all
other requisites are complied with, would be validly authorized should Ordinance No. 7 subsist.

So it seems, for all intents and purposes, that the Court of Appeals did deem Ordinance No. 7
a nullity. Through such resort, did the appellate court in effect allow a collateral attack on the
validity of an ordinance through an action for damages, as the petitioners argue?

The initiatory Complaint filed by Pereña deserves close scrutiny. Immediately, it can be seen
that it is not only an action for damages, but also one for injunction. An action for injunction will
require judicial determination whether there exists a right in esse which is to be protected, and
if there is an act constituting a violation of such right against which injunction is sought. At the
same time, the mere fact of injury alone does not give rise to a right to recover damages. To
warrant the recovery of damages, there must be both a right of action for a legal wrong inflicted
by the defendant, and damage resulting to the plaintiff therefrom. In other words, in order that
the law will give redress for an act causing damage, there must be damnum et injuria¾that act
must be not only hurtful, but wrongful.34

Indubitably, the determination of whether injunction or damages avail in this case requires the
ascertainment of whether a second cockpit may be legally allowed in Daanbantayan. If this is
permissible, Pereña would not be entitled either to injunctive relief or damages.

Moreover, an examination of the specific allegations in the Complaint reveals that Pereña
therein puts into question the legal basis for allowing Tan to operate another cockpit in
Daanbantayan. She asserted that "there is no lawful basis for the establishment of a second
cockpit considering the small population of [Daanbantayan],"35 a claim which alludes to
Section 5(b) of the Cockfighting Law which prohibits the establishment of a second cockpit in
municipalities of less than ten thousand (10,000) in population. Pereña likewise assails the
validity of the permit issued to Tan and prays for its annulment, and also seeks that Te be
enjoined from issuing any special permit not only to Tan, but also to "any other person outside
of a duly licensed cockpit in Daanbantayan, Cebu."36

It would have been preferable had Pereña expressly sought the annulment of Ordinance No. 7.
Yet it is apparent from her Complaint that she sufficiently alleges that there is no legal basis for
the establishment of a second cockpit. More importantly, the petitioners themselves raised the
valid effect of Ordinance No. 7 at the heart of their defense against the complaint, as adverted
to in their Answer.37 The averment in the Answer that Ordinance No. 7 is valid can be
considered as an affirmative defense, as it is the allegation of a new matter which, while
hypothetically admitting the material allegations in the complaint, would nevertheless bar
recovery.38 Clearly then, the validity of Ordinance No. 7 became a justiciable matter for the
RTC, and indeed Pereña squarely raised the argument during trial that said ordinance violated
the Cockfighting Law.39 1awphi1.nét

Moreover, the assailed rulings of the RTC, its Decision and subsequent Order denying
Pereña’s Motion for Reconsideration, both discuss the validity of Ordinance No. 7. In the
Decision, the RTC evaded making a categorical ruling on the ordinance’s validity because the
case was "only for damages, [thus the RTC could] not grant more relief than that prayed for."
This reasoning is unjustified, considering that Pereña also prayed for an injunction, as well as
for the annulment of Tan’s permit. The resolution of these two questions could very well hinge
on the validity of Ordinance No. 7.

Still, in the Order denying Pereña’s Motion for Reconsideration, the RTC felt less inhibited and
promptly declared as valid not only Ordinance No. 7, but also Resolution No. 78-96 of the
Sangguniang Bayan dated 23 February 1996, which conferred on Tan a franchise to operate a
cockpit from 1996 to 2006.40 In the Order, the RTC ruled that while Ordinance No. 7 was in
apparent conflict with the Cockfighting Law, the ordinance was justified under Section
447(a)(3)(v) of the Local Government Code.

This express affirmation of the validity of Ordinance No. 7 by the RTC was the first assigned
error in Pereña’s appeal to the Court of Appeals.41 In their Appellee’s Brief before the
appellate court, the petitioners likewise argued that Ordinance No. 7 was valid and that the
Cockfighting Law was repealed by the Local Government Code.42 On the basis of these
arguments, the Court of Appeals rendered its assailed Decision, including its ruling that the
Section 5(b) of the Cockfighting Law remains in effect notwithstanding the enactment of the
Local Government Code.

Indubitably, the question on the validity of Ordinance No. 7 in view of the continuing efficacy of
Section 5(b) of the Cockfighting Law is one that has been fully litigated in the courts below. We
are comfortable with reviewing that question in the case at bar and make dispositions
proceeding from that key legal question. This is militated by the realization that in order to
resolve the question whether injunction should be imposed against the petitioners, there must
be first a determination whether Tan may be allowed to operate a second cockpit in
Daanbantayan. Thus, the conflict between Section 5(b) of the Cockfighting Law and Ordinance
No. 7 now ripens for adjudication.

In arguing that Section 5(b) of the Cockfighting Law has been repealed, petitioners cite the
following provisions of Section 447(a)(3)(v) of the Local Government Code:

Section 447. Powers, Duties, Functions and Compensation. (a) The sangguniang bayan, as
the legislative body of the municipality, shall enact ordinances, approve resolutions and
appropriate funds for the general welfare of the municipality and its inhabitants pursuant to
Section 16 of this Code and in the proper exercise of the corporate powers of the municipality
as provided for under Section 22 of this Code, and shall:

....

(3) Subject to the provisions of Book II of this Code, grant franchises, enact ordinances
authorizing the issuance of permits or licenses, or enact ordinances levying taxes, fees and
charges upon such conditions and for such purposes intended to promote the general welfare
of the inhabitants of the municipality, and pursuant to this legislative authority shall:

....

(v) Any law to the contrary notwithstanding, authorize and license the establishment, operation,
and maintenance of cockpits, and regulate cockfighting and commercial breeding of
gamecocks; Provided, that existing rights should not be prejudiced;
For the petitioners, Section 447(a)(3)(v) sufficiently repeals Section 5(b) of the Cockfighting
Law, vesting as it does on LGUs the power and authority to issue franchises and regulate the
operation and establishment of cockpits in their respective municipalities, any law to the
contrary notwithstanding.

However, while the Local Government Code expressly repealed several laws, the Cockfighting
Law was not among them. Section 534(f) of the Local Government Code declares that all
general and special laws or decrees inconsistent with the Code are hereby repealed or
modified accordingly, but such clause is not an express repealing clause because it fails to
identify or designate the acts that are intended to be repealed.43 It is a cardinal rule in
statutory construction that implied repeals are disfavored and will not be so declared unless
the intent of the legislators is manifest.44 As laws are presumed to be passed with deliberation
and with knowledge of all existing ones on the subject, it is logical to conclude that in passing a
statute it is not intended to interfere with or abrogate a former law relating to the same subject
matter, unless the repugnancy between the two is not only irreconcilable but also clear and
convincing as a result of the language used, or unless the latter Act fully embraces the subject
matter of the earlier.45

Is the one-cockpit-per-municipality rule under the Cockfighting Law clearly and convincingly
irreconcilable with Section 447(a)(3)(v) of the Local Government Code? The clear import of
Section 447(a)(3)(v) is that it is the sangguniang bayan which is empowered to authorize and
license the establishment, operation and maintenance of cockpits, and regulate cockfighting
and commercial breeding of gamecocks, notwithstanding any law to the contrary. The
necessity of the qualifying phrase "any law to the contrary notwithstanding" can be discerned
by examining the history of laws pertaining to the authorization of cockpit operation in this
country.

Cockfighting, or sabong in the local parlance, has a long and storied tradition in our culture and
was prevalent even during the Spanish occupation. When the newly-arrived Americans
proceeded to organize a governmental structure in the Philippines, they recognized
cockfighting as an activity that needed to be regulated, and it was deemed that it was the local
municipal council that was best suited to oversee such regulation. Hence, under Section 40 of
Act No. 82, the general act for the organization of municipal governments promulgated in
1901, the municipal council was empowered "to license, tax or close cockpits". This power of
the municipal council to authorize or license cockpits was repeatedly recognized even after the
establishment of the present Republic in 1946.46 Such authority granted unto the municipal
councils to license the operation of cockpits was generally unqualified by restrictions.47 The
Revised Administrative Code did impose restrictions on what days cockfights could be held.48

However, in the 1970s, the desire for stricter licensing requirements of cockpits started to see
legislative fruit. The Cockfighting Law of 1974 enacted several of these restrictions. Apart from
the one-cockpit-per-municipality rule, other restrictions were imposed, such as the limitation of
ownership of cockpits to Filipino citizens.49 More importantly, under Section 6 of the
Cockfighting Law, it was the city or municipal mayor who was authorized to issue licenses for
the operation and maintenance of cockpits, subject to the approval of the Chief of
Constabulary or his authorized representatives.50 Thus, the sole discretion to authorize the
operation of cockpits was removed from the local government unit since the approval of the
Chief of Constabulary was now required.

P.D. No. 1802 reestablished the Philippine Gamefowl Commission51 and imposed further
structure in the regulation of cockfighting. Under Section 4 thereof, city and municipal mayors
with the concurrence of their respective sangguniang panglunsod or sangguniang bayan, were
given the authority to license and regulate cockfighting, under the supervision of the City
Mayor or the Provincial Governor. However, Section 4 of P.D. No. 1802 was subsequently
amended, removing the supervision exercised by the mayor or governor and substituting in
their stead the Philippine Gamefowl Commission. The amended provision ordained:

Sec. 4. City and Municipal Mayors with the concurrence of their respective "Sanggunians" shall
have the authority to license and regulate regular cockfighting pursuant to the rules and
regulations promulgated by the Commission and subject to its review and supervision.

The Court, on a few occasions prior to the enactment of the Local Government Code in 1991,
had opportunity to expound on Section 4 as amended. A discussion of these cases will provide
a better understanding of the qualifier "any law to the contrary notwithstanding" provided in
Section 447(a)(3)(v).

In Philippine Gamefowl Commission v. Intermediate Appellate Court,52 the Court, through

Justice Cruz, asserted that the conferment of the power to license and regulate municipal
cockpits in municipal authorities is in line with the policy of local autonomy embodied in the
Constitution.53 The Court affirmed the annulment of a resolution of the Philippine Gamefowl
Commission which ordered the revocation of a permit issued by a municipal mayor for the
operation of a cockpit and the issuance of a new permit to a different applicant. According to
the Court, the Philippine Gamefowl Commission did not possess the power to issue cockpit
licenses, as this was vested by Section 4 of P.D. No. 1802, as amended, to the municipal
mayor with the concurrence of the sanggunian. It emphasized that the Philippine Gamefowl
Commission only had review and supervision powers, as distinguished from control, over
ordinary cockpits.54 The Court also noted that the regulation of cockpits was vested in
municipal officials, subject only to the guidelines laid down by the Philippine Gamefowl
Commission.55 The Court conceded that "[if] at all, the power to review includes the power to
disapprove; but it does not carry the authority to substitute one’s own preferences for that
chosen by the subordinate in the exercise of its sound discretion."

The twin pronouncements that it is the municipal authorities who are empowered to issue
cockpit licenses and that the powers of the Philippine Gamefowl Commission were limited to
review and supervision were affirmed in Deang v. Intermediate Appellate Court,56 Municipality
of Malolos v. Libangang Malolos Inc.57 and Adlawan v. Intermediate Appellate Court.58 But
notably in Cootauco v. Court of Appeals,59 the Court especially noted that Philippine
Gamefowl Commission did indicate that the Commission’s "power of review includes the power
to disapprove."60 Interestingly, Justice Cruz, the writer of Philippine Gamefowl Commission,
qualified his concurrence in Cootauco "subject to the reservations made in [Philippine
Gamefowl Commission] regarding the review powers of the PGC over cockpit licenses issued
by city and municipal mayors."61 1awphi1.nét

These cases reiterate what has been the traditional prerogative of municipal officials to control
the issuances of licenses for the operation of cockpits. Nevertheless, the newly-introduced role
of the Philippine Gamefowl Commission vis-à-vis the operation of cockpits had caused some
degree of controversy, as shown by the cases above cited.

Then, the Local Government Code of 1991 was enacted. There is no more forceful authority
on this landmark legislation than Senator Aquilino Pimentel, Jr., its principal author. In his
annotations to the Local Government Code, he makes the following remarks relating to Section
447(a)(3)(v):

12. Licensing power. In connection with the power to grant licenses lodged with it, the
Sangguniang Bayan may now regulate not only businesses but also occupations, professions
or callings that do not require government examinations within its jurisdiction.l^vvphi1.net It
may also authorize and license the establishment, operation and maintenance of cockpits,
regulate cockfighting, and the commercial breeding of gamecocks. Existing rights however,
may not be prejudiced. The power to license cockpits and permits for cockfighting has been
removed completely from the Gamefowl Commission.

Thus, that part of the ruling of the Supreme Court in the case of Municipality of Malolos v.
Libangang Malolos, Inc. et al., which held that "…the regulation of cockpits is vested in the
municipal councils guidelines laid down by the Philippine Gamefowl Commission" is no longer
controlling. Under [Section 447(a)(3)(v)], the power of the Sanggunian concerned is no longer
subject to the supervision of the Gamefowl Commission.62

The above observations may be faulted somewhat in the sense that they fail to acknowledge
the Court’s consistent position that the licensing power over cockpits belongs exclusively to the
municipal authorities and not the Philippine Gamefowl Commission. Yet these views of
Senator Pimentel evince the apparent confusion regarding the role of the Philippine Gamefowl
Commission as indicated in the cases previously cited, and accordingly bring the phrase
Section 447(a)(3)(v) used in "any law to the contrary notwithstanding" into its proper light. The
qualifier serves notice, in case it was still doubtful, that it is the sanggunian bayan concerned
alone which has the power to authorize and license the establishment, operation and
maintenance of cockpits, and regulate cockfighting and commercial breeding of gamecocks
within its territorial jurisdiction.

Given the historical perspective, it becomes evident why the legislature found the need to use
the phrase "any law to the contrary notwithstanding" in Section 447(a)(3)(v). However, does
the phrase similarly allow the Sangguniang Bayan to authorize more cockpits than allowed
under Section 5(d) of the Cockfighting Law? Certainly, applying the test of implied repeal,
these two provisions can stand together. While the sanggunian retains the power to authorize
and license the establishment, operation, and maintenance of cockpits, its discretion is limited
in that it cannot authorize more than one cockpit per city or municipality, unless such cities or
municipalities have a population of over one hundred thousand, in which case two cockpits
may be established. Considering that Section 447(a)(3)(v) speaks essentially of the identity of
the wielder of the power of control and supervision over cockpit operation, it is not inconsistent
with previous enactments that impose restrictions on how such power may be exercised. In
short, there is no dichotomy between affirming the power and subjecting it to limitations at the
same time.

Perhaps more essential than the fact that the two controverted provisions are not inconsistent
when put together, the Court recognizes that Section 5(d) of the Cockfighting Law arises from
a valid exercise of police power by the national government. Of course, local governments are
similarly empowered under Section 16 of the Local Government Code.l^vvphi1.net The
national government ought to be attuned to the sensitivities of devolution and strive to be
sparing in usurping the prerogatives of local governments to regulate the general welfare of
their constituents.

We do not doubt, however, the ability of the national government to implement police power
measures that affect the subjects of municipal government, especially if the subject of
regulation is a condition of universal character irrespective of territorial jurisdictions.
Cockfighting is one such condition. It is a traditionally regulated activity, due to the attendant
gambling involved63 or maybe even the fact that it essentially consists of two birds killing each
other for public amusement. Laws have been enacted restricting the days when cockfights
could be held,64 and legislation has even been emphatic that cockfights could not be held on
holidays celebrating national honor such as Independence Day65 and Rizal Day.66

The Whereas clauses of the Cockfighting Law emphasize that cockfighting "should neither be
exploited as an object of commercialism or business enterprise, nor made a tool of
uncontrolled gambling, but more as a vehicle for the preservation and perpetuation of native
Filipino heritage and thereby enhance our national identity."67 The obvious thrust of our laws
designating when cockfights could be held is to limit cockfighting and imposing the one-
cockpit-per-municipality rule is in line with that aim. Cockfighting is a valid matter of police
power regulation, as it is a form of gambling essentially antagonistic to the aims of enhancing
national productivity and self-reliance.68 Limitation on the number of cockpits in a given
municipality is a reasonably necessary means for the accomplishment of the purpose of
controlling cockfighting, for clearly more cockpits equals more cockfights.

If we construe Section 447(a)(3)(v) as vesting an unlimited discretion to the sanggunian to

control all aspects of cockpits and cockfighting in their respective jurisdiction, this could lead to
the prospect of daily cockfights in municipalities, a certain distraction in the daily routine of life
in a municipality. This certainly goes against the grain of the legislation earlier discussed. If the
arguments of the petitioners were adopted, the national government would be effectively
barred from imposing any future regulatory enactments pertaining to cockpits and cockfighting
unless it were to repeal Section 447(a)(3)(v).

A municipal ordinance must not contravene the Constitution or any statute, otherwise it is
void.69 Ordinance No. 7 unmistakably contravenes the Cockfighting Law in allowing three
cockpits in Daanbantayan. Thus, no rights can be asserted by the petitioners arising from the
Ordinance. We find the grant of injunction as ordered by the appellate court to be well-taken.

WHEREFORE, the petition is DENIED. Costs against petitioners.

SO ORDERED.

G.R. No. 138810 September 29, 2004

BATANGAS CATV, INC., petitioner,

vs.
THE COURT OF APPEALS, THE BATANGAS CITY SANGGUNIANG PANLUNGSOD and
BATANGAS CITY MAYOR, respondents.
DECISION

SANDOVAL-GUTIERREZ, J.:

In the late 1940s, John Walson, an appliance dealer in Pennsylvania, suffered a decline in the
sale of television (tv) sets because of poor reception of signals in his community. Troubled, he
built an antenna on top of a nearby mountain. Using coaxial cable lines, he distributed the tv
signals from the antenna to the homes of his customers. Walson’s innovative idea improved
his sales and at the same time gave birth to a new telecommunication system -- the
Community Antenna Television (CATV) or Cable Television.1

This technological breakthrough found its way in our shores and, like in its country of origin, it
spawned legal controversies, especially in the field of regulation. The case at bar is just
another occasion to clarify a shady area. Here, we are tasked to resolve the inquiry -- may a
local government unit (LGU) regulate the subscriber rates charged by CATV operators within
its territorial jurisdiction?

This is a petition for review on certiorari filed by Batangas CATV, Inc. (petitioner herein)
against the Sangguniang Panlungsod and the Mayor of Batangas City (respondents herein)
assailing the Court of Appeals (1) Decision2 dated February 12, 1999 and (2) Resolution3
dated May 26, 1999, in CA-G.R. CV No. 52361.4 The Appellate Court reversed and set aside
the Judgment5 dated October 29, 1995 of the Regional Trial Court (RTC), Branch 7, Batangas
City in Civil Case No. 4254,6 holding that neither of the respondents has the power to fix the
subscriber rates of CATV operators, such being outside the scope of the LGU’s power.

The antecedent facts are as follows:

On July 28, 1986, respondent Sangguniang Panlungsod enacted Resolution No. 2107 granting
petitioner a permit to construct, install, and operate a CATV system in Batangas City. Section 8
of the Resolution provides that petitioner is authorized to charge its subscribers the maximum
rates specified therein, "provided, however, that any increase of rates shall be subject to the
approval of the Sangguniang Panlungsod."8

Sometime in November 1993, petitioner increased its subscriber rates from ₱88.00 to ₱180.00
per month. As a result, respondent Mayor wrote petitioner a letter9 threatening to cancel its
permit unless it secures the approval of respondent Sangguniang Panlungsod, pursuant to
Resolution No. 210.

Petitioner then filed with the RTC, Branch 7, Batangas City, a petition for injunction docketed
as Civil Case No. 4254. It alleged that respondent Sangguniang Panlungsod has no authority
to regulate the subscriber rates charged by CATV operators because under Executive Order
No. 205, the National Telecommunications Commission (NTC) has the sole authority to
regulate the CATV operation in the Philippines.

On October 29, 1995, the trial court decided in favor of petitioner, thus:

"WHEREFORE, as prayed for, the defendants, their representatives, agents, deputies or other
persons acting on their behalf or under their instructions, are hereby enjoined from canceling
plaintiff’s permit to operate a Cable Antenna Television (CATV) system in the City of Batangas
or its environs or in any manner, from interfering with the authority and power of the National
Telecommunications Commission to grant franchises to operate CATV systems to qualified
applicants, and the right of plaintiff in fixing its service rates which needs no prior approval of
the Sangguniang Panlungsod of Batangas City.

The counterclaim of the plaintiff is hereby dismissed. No pronouncement as to costs.

IT IS SO ORDERED."10

The trial court held that the enactment of Resolution No. 210 by respondent violates the
State’s deregulation policy as set forth by then NTC Commissioner Jose Luis A. Alcuaz in his
Memorandum dated August 25, 1989. Also, it pointed out that the sole agency of the
government which can regulate CATV operation is the NTC, and that the LGUs cannot
exercise regulatory power over it without appropriate legislation.

Unsatisfied, respondents elevated the case to the Court of Appeals, docketed as CA-G.R. CV
No. 52361.

On February 12, 1999, the Appellate Court reversed and set aside the trial court’s Decision,
ratiocinating as follows:

"Although the Certificate of Authority to operate a Cable Antenna Television (CATV) System is
granted by the National Telecommunications Commission pursuant to Executive Order No.
205, this does not preclude the Sangguniang Panlungsod from regulating the operation of the
CATV in their locality under the powers vested upon it by Batas Pambansa Bilang 337,
otherwise known as the Local Government Code of 1983. Section 177 (now Section 457
paragraph 3 (ii) of Republic Act 7160) provides:

‘Section 177. Powers and Duties – The Sangguniang Panlungsod shall:

a) Enact such ordinances as may be necessary to carry into effect and discharge the
responsibilities conferred upon it by law, and such as shall be necessary and proper to provide
for health and safety, comfort and convenience, maintain peace and order, improve the
morals, and promote the prosperity and general welfare of the community and the inhabitants
thereof, and the protection of property therein;

xxx

d) Regulate, fix the license fee for, and tax any business or profession being carried on and
exercised within the territorial jurisdiction of the city, except travel agencies, tourist guides,
tourist transports, hotels, resorts, de luxe restaurants, and tourist inns of international
standards which shall remain under the licensing and regulatory power of the Ministry of
Tourism which shall exercise such authority without infringement on the taxing and regulatory
powers of the city government;’

Under cover of the General Welfare Clause as provided in this section, Local Government
Units can perform just about any power that will benefit their constituencies. Thus, local
government units can exercise powers that are: (1) expressly granted; (2) necessarily implied
from the power that is expressly granted; (3) necessary, appropriate or incidental for its
efficient and effective governance; and (4) essential to the promotion of the general welfare of
their inhabitants. (Pimentel, The Local Government Code of 1991, p. 46)

Verily, the regulation of businesses in the locality is expressly provided in the Local
Government Code. The fixing of service rates is lawful under the General Welfare Clause.

Resolution No. 210 granting appellee a permit to construct, install and operate a community
antenna television (CATV) system in Batangas City as quoted earlier in this decision,
authorized the grantee to impose charges which cannot be increased except upon approval of
the Sangguniang Bayan. It further provided that in case of violation by the grantee of the terms
and conditions/requirements specifically provided therein, the City shall have the right to
withdraw the franchise.

Appellee increased the service rates from EIGHTY EIGHT PESOS (₱88.00) to ONE
HUNDRED EIGHTY PESOS (₱180.00) (Records, p. 25) without the approval of appellant.
Such act breached Resolution No. 210 which gives appellant the right to withdraw the permit
granted to appellee."11

Petitioner filed a motion for reconsideration but was denied.12

Hence, the instant petition for review on certiorari anchored on the following assignments of
error:

"I

THE COURT OF APPEALS ERRED IN HOLDING THAT THE GENERAL WELFARE CLAUSE
of the LOCAL GOVERNMENT CODE AUTHORIZES RESPONDENT SANGGUNIANG
PANLUNGSOD TO EXERCISE THE REGULATORY FUNCTION SOLELY LODGED WITH
THE NATIONAL TELECOMMUNICATIONS COMMISSION UNDER EXECUTIVE ORDER NO.
205, INCLUDING THE AUTHORITY TO FIX AND/OR APPROVE THE SERVICE RATES OF
CATV OPERATORS; AND

II

THE COURT OF APPEALS ERRED IN REVERSING THE DECISION APPEALED FROM

AND DISMISSING PETITIONER’S COMPLAINT."13

Petitioner contends that while Republic Act No. 7160, the Local Government Code of 1991,
extends to the LGUs the general power to perform any act that will benefit their constituents,
nonetheless, it does not authorize them to regulate the CATV operation. Pursuant to E.O. No.
205, only the NTC has the authority to regulate the CATV operation, including the fixing of
subscriber rates.

Respondents counter that the Appellate Court did not commit any reversible error in rendering
the assailed Decision. First, Resolution No. 210 was enacted pursuant to Section 177(c) and
(d) of Batas Pambansa Bilang 337, the Local Government Code of 1983, which authorizes
LGUs to regulate businesses. The term "businesses" necessarily includes the CATV industry.
And second, Resolution No. 210 is in the nature of a contract between petitioner and
respondents, it being a grant to the former of a franchise to operate a CATV system. To hold
that E.O. No. 205 amended its terms would violate the constitutional prohibition against
impairment of contracts.14

The petition is impressed with merit.

Earlier, we posed the question -- may a local government unit (LGU) regulate the subscriber
rates charged by CATV operators within its territorial jurisdiction? A review of pertinent laws
and jurisprudence yields a negative answer.

President Ferdinand E. Marcos was the first one to place the CATV industry under the
regulatory power of the national government.15 On June 11, 1978, he issued Presidential
Decree (P.D.) No. 151216 establishing a monopoly of the industry by granting Sining Makulay,
Inc., an exclusive franchise to operate CATV system in any place within the Philippines.
Accordingly, it terminated all franchises, permits or certificates for the operation of CATV
system previously granted by local governments or by any instrumentality or agency of the
national government.17 Likewise, it prescribed the subscriber rates to be charged by Sining
Makulay, Inc. to its customers.18

On July 21, 1979, President Marcos issued Letter of Instruction (LOI) No. 894 vesting upon the
Chairman of the Board of Communications direct supervision over the operations of Sining
Makulay, Inc. Three days after, he issued E.O. No. 54619 integrating the Board of
Communications20 and the Telecommunications Control Bureau21 to form a single entity to
be known as the "National Telecommunications Commission." Two of its assigned functions
are:

"a. Issue Certificate of Public Convenience for the operation of communications utilities and
services, radio communications systems, wire or wireless telephone or telegraph systems,
radio and television broadcasting system and other similar public utilities;

b. Establish, prescribe and regulate areas of operation of particular operators of public service
communications; and determine and prescribe charges or rates pertinent to the operation of
such public utility facilities and services except in cases where charges or rates are
established by international bodies or associations of which the Philippines is a participating
member or by bodies recognized by the Philippine Government as the proper arbiter of such
charges or rates;"

Although Sining Makulay Inc.’s exclusive franchise had a life term of 25 years, it was cut short
by the advent of the 1986 Revolution. Upon President Corazon C. Aquino’s assumption of
power, she issued E.O. No. 20522 opening the CATV industry to all citizens of the Philippines.
It mandated the NTC to grant Certificates of Authority to CATV operators and to issue the
necessary implementing rules and regulations.

On September 9, 1997, President Fidel V. Ramos issued E.O. No. 43623 prescribing policy
guidelines to govern CATV operation in the Philippines. Cast in more definitive terms, it
restated the NTC’s regulatory powers over CATV operations, thus:

"SECTION 2. The regulation and supervision of the cable television industry in the Philippines
shall remain vested solely with the National Telecommunications Commission (NTC).
SECTION 3. Only persons, associations, partnerships, corporations or cooperatives, granted a
Provisional Authority or Certificate of Authority by the Commission may install, operate and
maintain a cable television system or render cable television service within a service area."

Clearly, it has been more than two decades now since our national government, through the
NTC, assumed regulatory power over the CATV industry. Changes in the political arena did
not alter the trend. Instead, subsequent presidential issuances further reinforced the NTC’s
power. Significantly, President Marcos and President Aquino, in the exercise of their legislative
power, issued P.D. No. 1512, E.O. No. 546 and E.O. No. 205. Hence, they have the force and
effect of statutes or laws passed by Congress.24 That the regulatory power stays with the NTC
is also clear from President Ramos’ E.O. No. 436 mandating that the regulation and
supervision of the CATV industry shall remain vested "solely" in the NTC. Black’s Law
Dictionary defines "sole" as "without another or others."25 The logical conclusion, therefore, is
that in light of the above laws and E.O. No. 436, the NTC exercises regulatory power over
CATV operators to the exclusion of other bodies.

But, lest we be misunderstood, nothing herein should be interpreted as to strip LGUs of their
general power to prescribe regulations under the general welfare clause of the Local
Government Code. It must be emphasized that when E.O. No. 436 decrees that the "regulatory
power" shall be vested "solely" in the NTC, it pertains to the "regulatory power" over those
matters which are peculiarly within the NTC’s competence, such as, the: (1) determination of
rates, (2) issuance of "certificates of authority, (3) establishment of areas of operation, (4)
examination and assessment of the legal, technical and financial qualifications of applicant
operators, (5) granting of permits for the use of frequencies, (6) regulation of ownership and
operation, (7) adjudication of issues arising from its functions, and (8) other similar matters.26
Within these areas, the NTC reigns supreme as it possesses the exclusive power to regulate --
a power comprising varied acts, such as "to fix, establish, or control; to adjust by rule, method
or established mode; to direct by rule or restriction; or to subject to governing principles or
laws."27

Coincidentally, respondents justify their exercise of regulatory power over petitioner’s CATV
operation under the general welfare clause of the Local Government Code of 1983. The Court
of Appeals sustained their stance.

There is no dispute that respondent Sangguniang Panlungsod, like other local legislative
bodies, has been empowered to enact ordinances and approve resolutions under the general
welfare clause of B.P. Blg. 337, the Local Government Code of 1983. That it continues to
posses such power is clear under the new law, R.A. No. 7160 (the Local Government Code of
1991). Section 16 thereof provides:

"SECTION 16. General Welfare. – Every local government unit shall exercise the powers
expressly granted, those necessarily implied therefrom, as well as powers necessary,
appropriate, or incidental for its efficient and effective governance, and those which are
essential to the promotion of the general welfare. Within their respective territorial jurisdictions,
local government units shall ensure and support, among others, the preservation and
enrichment of culture, promote health and safety, enhance the right of the people to a
balanced ecology, encourage and support the development of appropriate and self-reliant,
scientific and technological capabilities, improve public morals, enhance economic prosperity
and social justice, promote full employment among their residents, maintain peace and order,
and preserve the comfort and convenience of their inhabitants."

In addition, Section 458 of the same Code specifically mandates:

"SECTION 458. Powers, Duties, Functions and Compensation. — (a) The Sangguniang
Panlungsod, as the legislative body of the city, shall enact ordinances, approve resolutions and
appropriate funds for the general welfare of the city and its inhabitants pursuant to Section 16
of this Code and in the proper exercise of the corporate powers of the city as provided for
under Section 22 of this Code, x x x:"

The general welfare clause is the delegation in statutory form of the police power of the State
to LGUs.28 Through this, LGUs may prescribe regulations to protect the lives, health, and
property of their constituents and maintain peace and order within their respective territorial
jurisdictions. Accordingly, we have upheld enactments providing, for instance, the regulation of
gambling,29 the occupation of rig drivers,30 the installation and operation of pinball
machines,31 the maintenance and operation of cockpits,32 the exhumation and transfer of
corpses from public burial grounds,33 and the operation of hotels, motels, and lodging
houses34 as valid exercises by local legislatures of the police power under the general welfare
clause.

Like any other enterprise, CATV operation maybe regulated by LGUs under the general
welfare clause. This is primarily because the CATV system commits the indiscretion of
crossing public properties. (It uses public properties in order to reach subscribers.) The
physical realities of constructing CATV system – the use of public streets, rights of ways, the
founding of structures, and the parceling of large regions – allow an LGU a certain degree of
regulation over CATV operators.35 This is the same regulation that it exercises over all private
enterprises within its territory.

But, while we recognize the LGUs’ power under the general welfare clause, we cannot sustain
Resolution No. 210. We are convinced that respondents strayed from the well recognized
limits of its power. The flaws in Resolution No. 210 are: (1) it violates the mandate of existing
laws and (2) it violates the State’s deregulation policy over the CATV industry.

I.

Resolution No. 210 is an enactment of an LGU acting only as agent of the national legislature.
Necessarily, its act must reflect and conform to the will of its principal. To test its validity, we
must apply the particular requisites of a valid ordinance as laid down by the accepted
principles governing municipal corporations.36

Speaking for the Court in the leading case of United States vs. Abendan,37 Justice Moreland
said: "An ordinance enacted by virtue of the general welfare clause is valid, unless it
contravenes the fundamental law of the Philippine Islands, or an Act of the Philippine
Legislature, or unless it is against public policy, or is unreasonable, oppressive, partial,
discriminating, or in derogation of common right." In De la Cruz vs. Paraz,38 we laid the
general rule "that ordinances passed by virtue of the implied power found in the general
welfare clause must be reasonable, consonant with the general powers and purposes of the
corporation, and not inconsistent with the laws or policy of the State."

The apparent defect in Resolution No. 210 is that it contravenes E.O. No. 205 and E.O. No.
436 insofar as it permits respondent Sangguniang Panlungsod to usurp a power exclusively
vested in the NTC, i.e., the power to fix the subscriber rates charged by CATV operators. As
earlier discussed, the fixing of subscriber rates is definitely one of the matters within the NTC’s
exclusive domain.
In this regard, it is appropriate to stress that where the state legislature has made provision for
the regulation of conduct, it has manifested its intention that the subject matter shall be fully
covered by the statute, and that a municipality, under its general powers, cannot regulate the
same conduct.39 In Keller vs. State,40 it was held that: "Where there is no express power in
the charter of a municipality authorizing it to adopt ordinances regulating certain matters which
are specifically covered by a general statute, a municipal ordinance, insofar as it attempts to
regulate the subject which is completely covered by a general statute of the legislature, may be
rendered invalid. x x x Where the subject is of statewide concern, and the legislature has
appropriated the field and declared the rule, its declaration is binding throughout the State." A
reason advanced for this view is that such ordinances are in excess of the powers granted to
the municipal corporation.41

Since E.O. No. 205, a general law, mandates that the regulation of CATV operations shall be
exercised by the NTC, an LGU cannot enact an ordinance or approve a resolution in violation
of the said law.

It is a fundamental principle that municipal ordinances are inferior in status and subordinate to
the laws of the state. An ordinance in conflict with a state law of general character and
statewide application is universally held to be invalid.42 The principle is frequently expressed
in the declaration that municipal authorities, under a general grant of power, cannot adopt
ordinances which infringe the spirit of a state law or repugnant to the general policy of the
state.43 In every power to pass ordinances given to a municipality, there is an implied
restriction that the ordinances shall be consistent with the general law.44 In the language of
Justice Isagani Cruz (ret.), this Court, in Magtajas vs. Pryce Properties Corp., Inc.,45 ruled
that:

"The rationale of the requirement that the ordinances should not contravene a statute is
obvious. Municipal governments are only agents of the national government. Local councils
exercise only delegated legislative powers conferred on them by Congress as the national
lawmaking body. The delegate cannot be superior to the principal or exercise powers higher
than those of the latter. 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
mere ordinance the mandate of the statute.

‘Municipal corporations owe their origin to, and derive their powers and rights wholly from the
legislature. It breathes into them the breath of life, without which they cannot exist. As it
creates, so it may destroy. As it may destroy, it may abridge and control. Unless there is some
constitutional limitation on the right, the legislature might, by a single act, and if we can
suppose it capable of so great a folly and so great a wrong, sweep from existence all of the
municipal corporations in the State, and the corporation could not prevent it. We know of no
limitation on the right so far as to the corporation themselves are concerned. They are, so to
phrase it, the mere tenants at will of the legislature.’

This basic relationship between the national legislature and the local government units has not
been enfeebled by the new provisions in the Constitution strengthening the policy of local
autonomy. Without meaning to detract from that policy, we here confirm that Congress retains
control of the local government units although in significantly reduced degree now than under
our previous Constitutions. The power to create still includes the power to destroy. The power
to grant still includes the power to withhold or recall. True, there are certain notable innovations
in the Constitution, like the direct conferment on the local government units of the power to tax,
which cannot now be withdrawn by mere statute. By and large, however, the national
legislature is still the principal of the local government units, which cannot defy its will or modify
or violate it."
Respondents have an ingenious retort against the above disquisition. Their theory is that the
regulatory power of the LGUs is granted by R.A. No. 7160 (the Local Government Code of
1991), a handiwork of the national lawmaking authority. They contend that R.A. No. 7160
repealed E.O. No. 205 (issued by President Aquino). Respondents’ argument espouses a bad
precedent. To say that LGUs exercise the same regulatory power over matters which are
peculiarly within the NTC’s competence is to promote a scenario of LGUs and the NTC locked
in constant clash over the appropriate regulatory measure on the same subject matter. LGUs
must recognize that technical matters concerning CATV operation are within the exclusive
regulatory power of the NTC.

At any rate, we find no basis to conclude that R.A. No. 7160 repealed E.O. No. 205, either
expressly or impliedly. It is noteworthy that R.A. No. 7160 repealing clause, which
painstakingly mentions the specific laws or the parts thereof which are repealed, does not
include E.O. No. 205, thus:

"SECTION 534. Repealing Clause. — (a) Batas Pambansa Blg. 337, otherwise known as the
Local Government Code." Executive Order No. 112 (1987), and Executive Order No. 319
(1988) are hereby repealed.

(b) Presidential Decree Nos. 684, 1191, 1508 and such other decrees, orders, instructions,
memoranda and issuances related to or concerning the barangay are hereby repealed.

(c) The provisions of Sections 2, 3, and 4 of Republic Act No. 1939 regarding hospital fund;
Section 3, a (3) and b (2) of Republic Act. No. 5447 regarding the Special Education Fund;
Presidential Decree No. 144 as amended by Presidential Decree Nos. 559 and 1741;
Presidential Decree No. 231 as amended; Presidential Decree No. 436 as amended by
Presidential Decree No. 558; and Presidential Decree Nos. 381, 436, 464, 477, 526, 632, 752,
and 1136 are hereby repealed and rendered of no force and effect.

(d) Presidential Decree No. 1594 is hereby repealed insofar as it governs locally-funded
projects.

(e) The following provisions are hereby repealed or amended insofar as they are inconsistent
with the provisions of this Code: Sections 2, 16, and 29 of Presidential Decree No. 704;
Section 12 of Presidential Decree No. 87, as amended; Sections 52, 53, 66, 67, 68, 69, 70, 71,
72, 73, and 74 of Presidential Decree No. 463, as amended; and Section 16 of Presidential
Decree No. 972, as amended, and

(f) All general and special laws, acts, city charters, decrees, executive orders, proclamations
and administrative regulations, or part or parts thereof which are inconsistent with any of the
provisions of this Code are hereby repealed or modified accordingly."

Neither is there an indication that E.O. No. 205 was impliedly repealed by R.A. No. 7160. It is a
settled rule that implied repeals are not lightly presumed in the absence of a clear and
unmistakable showing of such intentions. In Mecano vs. Commission on Audit,46 we ruled:

"Repeal by implication proceeds on the premise that where a statute of later date clearly
reveals an intention on the part of the legislature to abrogate a prior act on the subject, that
intention must be given effect. Hence, before there can be a repeal, there must be a clear
showing on the part of the lawmaker that the intent in enacting the new law was to abrogate
the old one. The intention to repeal must be clear and manifest; otherwise, at least, as a
general rule, the later act is to be construed as a continuation of, and not a substitute for, the
first act and will continue so far as the two acts are the same from the time of the first
enactment."

As previously stated, E.O. No. 436 (issued by President Ramos) vests upon the NTC the
power to regulate the CATV operation in this country. So also Memorandum Circular No. 8-9-
95, the Implementing Rules and Regulations of R.A. No. 7925 (the "Public
Telecommunications Policy Act of the Philippines"). This shows that the NTC’s regulatory
power over CATV operation is continuously recognized.

It is a canon of legal hermeneutics that instead of pitting one statute against another in an
inevitably destructive confrontation, courts must exert every effort to reconcile them,
remembering that both laws deserve a becoming respect as the handiwork of coordinate
branches of the government.47 On the assumption of a conflict between E.O. No. 205 and
R.A. No. 7160, the proper action is not to uphold one and annul the other but to give effect to
both by harmonizing them if possible. This recourse finds application here. Thus, we hold that
the NTC, under E.O. No. 205, has exclusive jurisdiction over matters affecting CATV
operation, including specifically the fixing of subscriber rates, but nothing herein precludes
LGUs from exercising its general power, under R.A. No. 7160, to prescribe regulations to
promote the health, morals, peace, education, good order or safety and general welfare of their
constituents. In effect, both laws become equally effective and mutually complementary.

The grant of regulatory power to the NTC is easily understandable. CATV system is not a mere
local concern. The complexities that characterize this new technology demand that it be
regulated by a specialized agency. This is particularly true in the area of rate-fixing. Rate fixing
involves a series of technical operations.48 Consequently, on the hands of the regulatory body
lies the ample discretion in the choice of such rational processes as might be appropriate to
the solution of its highly complicated and technical problems. Considering that the CATV
industry is so technical a field, we believe that the NTC, a specialized agency, is in a better
position than the LGU, to regulate it. Notably, in United States vs. Southwestern Cable Co.,49
the US Supreme Court affirmed the Federal Communications Commission’s (FCC’s)
jurisdiction over CATV operation. The Court held that the FCC’s authority over cable systems
assures the preservation of the local broadcast service and an equitable distribution of
broadcast services among the various regions of the country.

II.

Resolution No. 210 violated the State’s deregulation policy.

Deregulation is the reduction of government regulation of business to permit freer markets and
competition.50 Oftentimes, the State, through its regulatory agencies, carries out a policy of
deregulation to attain certain objectives or to address certain problems. In the field of
telecommunications, it is recognized that many areas in the Philippines are still "unserved" or
"underserved." Thus, to encourage private sectors to venture in this field and be partners of
the government in stimulating the growth and development of telecommunications, the State
promoted the policy of deregulation.

In the United States, the country where CATV originated, the Congress observed, when it
adopted the Telecommunications Act of 1996, that there was a need to provide a pro-
competitive, deregulatory national policy framework designed to accelerate rapidly private
sector deployment of advanced telecommunications and information technologies and services
to all Americans by opening all telecommunications markets to competition. The FCC has
adopted regulations to implement the requirements of the 1996 Act and the intent of the
Congress.
Our country follows the same policy. The fifth Whereas Clause of E.O. No. 436 states:

"WHEREAS, professionalism and self-regulation among existing operators, through a

nationally recognized cable television operator’s association, have enhanced the growth of the
cable television industry and must therefore be maintained along with minimal reasonable
government regulations;"

This policy reaffirms the NTC’s mandate set forth in the Memorandum dated August 25, 1989
of Commissioner Jose Luis A. Alcuaz, to wit:

"In line with the purpose and objective of MC 4-08-88, Cable Television System or Community
Antenna Television (CATV) is made part of the broadcast media to promote the orderly growth
of the Cable Television Industry it being in its developing stage. Being part of the Broadcast
Media, the service rates of CATV are likewise considered deregulated in accordance with MC
06-2-81 dated 25 February 1981, the implementing guidelines for the authorization and
operation of Radio and Television Broadcasting stations/systems.

Further, the Commission will issue Provisional Authority to existing CATV operators to
authorize their operations for a period of ninety (90) days until such time that the Commission
can issue the regular Certificate of Authority."

When the State declared a policy of deregulation, the LGUs are bound to follow. To rule
otherwise is to render the State’s policy ineffective. Being mere creatures of the State, LGUs
cannot defeat national policies through enactments of contrary measures. Verily, in the case at
bar, petitioner may increase its subscriber rates without respondents’ approval.

At this juncture, it bears emphasizing that municipal corporations are bodies politic and
corporate, created not only as local units of local self-government, but as governmental
agencies of the state.51 The legislature, by establishing a municipal corporation, does not
divest the State of any of its sovereignty; absolve itself from its right and duty to administer the
public affairs of the entire state; or divest itself of any power over the inhabitants of the district
which it possesses before the charter was granted.52

Respondents likewise argue that E.O. No. 205 violates the constitutional prohibition against
impairment of contracts, Resolution No. 210 of Batangas City Sangguniang Panlungsod being
a grant of franchise to petitioner.

We are not convinced.

There is no law specifically authorizing the LGUs to grant franchises to operate CATV system.
Whatever authority the LGUs had before, the same had been withdrawn when President
Marcos issued P.D. No. 1512 "terminating all franchises, permits or certificates for the
operation of CATV system previously granted by local governments." Today, pursuant to
Section 3 of E.O. No. 436, "only persons, associations, partnerships, corporations or
cooperatives granted a Provisional Authority or Certificate of Authority by the NTC may install,
operate and maintain a cable television system or render cable television service within a
service area." It is clear that in the absence of constitutional or legislative authorization,
municipalities have no power to grant franchises.53 Consequently, the protection of the
constitutional provision as to impairment of the obligation of a contract does not extend to
privileges, franchises and grants given by a municipality in excess of its powers, or ultra
vires.54

One last word. The devolution of powers to the LGUs, pursuant to the Constitutional mandate
of ensuring their autonomy, has bred jurisdictional tension between said LGUs and the State.
LGUs must be reminded that they merely form part of the whole. Thus, when the Drafters of
the 1987 Constitution enunciated the policy of ensuring the autonomy of local governments,55
it was never their intention to create an imperium in imperio and install an intra-sovereign
political subdivision independent of a single sovereign state.

WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of Appeals dated
February 12, 1999 as well as its Resolution dated May 26, 1999 in CA-G.R. CV No. 52461, are
hereby REVERSED. The RTC Decision in Civil Case No. 4254 is AFFIRMED.

No pronouncement as to costs.

SO ORDERED.

G.R. No. 125350. December 3, 2002

HON. RTC JUDGES MERCEDES G. DADOLE (Executive Judge, Branch 28), ULRIC R.
CAETE (Presiding Judge, Branch 25), AGUSTINE R. VESTIL (Presiding Judge, Branch 56),
HON. MTC JUDGES TEMISTOCLES M. BOHOLST (Presiding Judge, Branch 1), VICENTE C.
FANILAG (Judge Designate, Branch 2), and WILFREDO A. DAGATAN (Presiding Judge,
Branch 3), all of Mandaue City, petitioners, vs. COMMISSION ON AUDIT, respondent.

DECISION

CORONA, J.:

Before us is a petition for certiorari under Rule 64 to annul the decision[1 and resolution[2,
dated September 21, 1995 and May 28, 1996, respectively, of the respondent Commission on
Audit (COA) affirming the notices of the Mandaue City Auditor which diminished the monthly
additional allowances received by the petitioner judges of the Regional Trial Court (RTC) and
Municipal Trial Court (MTC) stationed in Mandaue City.

The undisputed facts are as follows:

In 1986, the RTC and MTC judges of Mandaue City started receiving monthly allowances of
P1,260 each through the yearly appropriation ordinance enacted by the Sangguniang
Panlungsod of the said city. In 1991, Mandaue City increased the amount to P1,500 for each
judge.

On March 15, 1994, the Department of Budget and Management (DBM) issued the disputed
Local Budget Circular No. 55 (LBC 55) which provided that:

xxx xxx xxx

2.3.2. In the light of the authority granted to the local government units under the Local
Government Code to provide for additional allowances and other benefits to national
government officials and employees assigned in their locality, such additional allowances in
the form of honorarium at rates not exceeding P1,000.00 in provinces and cities and P700.00
in municipalities may be granted subject to the following conditions:

a) That the grant is not mandatory on the part of the LGUs;

b) That all contractual and statutory obligations of the LGU including the implementation of
R.A. 6758 shall have been fully provided in the budget;

c) That the budgetary requirements/limitations under Section 324 and 325 of R.A. 7160 should
be satisfied and/or complied with; and

d) That the LGU has fully implemented the devolution of functions/personnel in accordance
with R.A. 7160.3 (italics supplied)

xxx xxx xxx

The said circular likewise provided for its immediate effectivity without need of publication:

5.0 EFFECTIVITY

This Circular shall take effect immediately.

Acting on the DBM directive, the Mandaue City Auditor issued notices of disallowance to
herein petitioners, namely, Honorable RTC Judges Mercedes G. Dadole, Ulric R. Caete,
Agustin R. Vestil, Honorable MTC Judges Temistocles M. Boholst, Vicente C. Fanilag and
Wilfredo A. Dagatan, in excess of the amount authorized by LBC 55. Beginning October, 1994,
the additional monthly allowances of the petitioner judges were reduced to P1,000 each. They
were also asked to reimburse the amount they received in excess of P1,000 from April to
September, 1994.
The petitioner judges filed with the Office of the City Auditor a protest against the notices of
disallowance. But the City Auditor treated the protest as a motion for reconsideration and
indorsed the same to the COA Regional Office No. 7. In turn, the COA Regional Office referred
the motion to the head office with a recommendation that the same be denied.

On September 21, 1995, respondent COA rendered a decision denying petitioners motion for
reconsideration. The COA held that:

The issue to be resolved in the instant appeal is whether or not the City Ordinance of Mandaue
which provides a higher rate of allowances to the appellant judges may prevail over that fixed
by the DBM under Local Budget Circular No. 55 dated March 15, 1994.

xxx xxx xxx

Applying the foregoing doctrine, appropriation ordinance of local government units is subject to
the organizational, budgetary and compensation policies of budgetary authorities (COA 5th
Ind., dated March 17, 1994 re: Province of Antique; COA letter dated May 17, 1994 re:
Request of Hon. Renato Leviste, Cong. 1st Dist. Oriental Mindoro). In this regard, attention is
invited to Administrative Order No. 42 issued on March 3, 1993 by the President of the
Philippines clarifying the role of DBM in the compensation and classification of local
government positions under RA No. 7160 vis-avis the provisions of RA No. 6758 in view of the
abolition of the JCLGPA. Section 1 of said Administrative Order provides that:

Section 1. The Department of Budget and Management as the lead administrator of RA No.
6758 shall, through its Compensation and Position Classification Bureau, continue to have the
following responsibilities in connection with the implementation of the Local Government Code
of 1991:

a) Provide guidelines on the classification of local government positions and on the specific
rates of pay therefore;

b) Provide criteria and guidelines for the grant of all allowances and additional forms of
compensation to local government employees; xxx. (underscoring supplied)

To operationalize the aforecited presidential directive, DBM issued LBC No. 55, dated March
15, 1994, whose effectivity clause provides that:

xxx xxx xxx

5.0 EFFECTIVITY

This Circular shall take effect immediately.

It is a well-settled rule that implementing rules and regulations promulgated by administrative

or executive officer in accordance with, and as authorized by law, has the force and effect of
law or partake the nature of a statute (Victorias Milling Co., Inc., vs. Social Security
Commission, 114 Phil. 555, cited in Agpalos Statutory Construction, 2nd Ed. P. 16; Justice
Cruzs Phil. Political Law, 1984 Ed., p. 103; Espanol vs. Phil Veterans Administration, 137
SCRA 314; Antique Sawmills Inc. vs. Tayco, 17 SCRA 316).

xxx xxx xxx

There being no statutory basis to grant additional allowance to judges in excess of P1,000.00
chargeable against the local government units where they are stationed, this Commission finds
no substantial grounds or cogent reason to disturb the decision of the City Auditor, Mandaue
City, disallowing in audit the allowances in question. Accordingly, the above-captioned appeal
of the MTC and RTC Judges of Mandaue City, insofar as the same is not covered by Circular
Letter No. 91-7, is hereby dismissed for lack of merit.

xxx xxx xxx4cräläwvirtualibräry

On November 27, 1995, Executive Judge Mercedes Gozo-Dadole, for and in behalf of the
petitioner judges, filed a motion for reconsideration of the decision of the COA. In a resolution
dated May 28, 1996, the COA denied the motion.

Hence, this petition for certiorari by the petitioner judges, submitting the following questions for
resolution:

HAS THE CITY OF MANDAUE STATUTORY AND CONSTITUTIONAL BASIS TO PROVIDE

ADDITIONAL ALLOWANCES AND OTHER BENEFITS TO JUDGES STATIONED IN AND
ASSIGNED TO THE CITY?

II

CAN AN ADMINISTRATIVE CIRCULAR OR GUIDELINE SUCH AS LOCAL BUDGET

CIRCULAR NO. 55 RENDER INOPERATIVE THE POWER OF THE LEGISLATIVE BODY OF
A CITY BY SETTING A LIMIT TO THE EXTENT OF THE EXERCISE OF SUCH POWER?

III

HAS THE COMMISSION ON AUDIT CORRECTLY INTERPRETED LOCAL BUDGET

CIRCULAR NO. 55 TO INCLUDE MEMBERS OF THE JUDICIARY IN FIXING THE CEILING
OF ADDITIONAL ALLOWANCES AND BENEFITS TO BE PROVIDED TO JUDGES
STATIONED IN AND ASSIGNED TO MANDAUE CITY BY THE CITY GOVERNMENT AT
P1,000.00 PER MONTH NOTWITHSTANDING THAT THEY HAVE BEEN RECEIVING
ALLOWANCES OF P1,500.00 MONTHLY FOR THE PAST FIVE YEARS?

IV
IS LOCAL BUDGET CIRCULAR NO. 55 DATED MARCH 15, 1994 ISSUED BY THE
DEPARTMENT OF BUDGET AND MANAGEMENT VALID AND ENFORCEABLE
CONSIDERING THAT IT WAS NOT DULY PUBLISHED IN ACCODANCE WITH
LAW?5cräläwvirtualibräry

Petitioner judges argue that LBC 55 is void for infringing on the local autonomy of Mandaue
City by dictating a uniform amount that a local government unit can disburse as additional
allowances to judges stationed therein. They maintain that said circular is not supported by any
law and therefore goes beyond the supervisory powers of the President. They further allege
that said circular is void for lack of publication.

On the other hand, the yearly appropriation ordinance providing for additional allowances to
judges is allowed by Section 458, par. (a)(1)[xi], of RA 7160, otherwise known as the Local
Government Code of 1991, which provides that:

Sec. 458. Powers, Duties, Functions and Compensation. (a) The sangguniang panlungsod, as
the legislative body of the city, shall enact ordinances, approve resolutions and appropriate
funds for the general welfare of the city and its inhabitants pursuant to Section 16 of this Code
and in the proper exercise of the corporate powers of the city as provided for under Section 22
of this Code, and shall:

(1) Approve ordinances and pass resolutions necessary for an efficient and effective city
government, and in this connection, shall:

xxx xxx xxx

(xi) When the finances of the city government allow, provide for additional allowances and
other benefits to judges, prosecutors, public elementary and high school teachers, and other
national government officials stationed in or assigned to the city; (italics supplied)

Instead of filing a comment on behalf of respondent COA, the Solicitor General filed a
manifestation supporting the position of the petitioner judges. The Solicitor General argues that
(1) DBM only enjoys the power to review and determine whether the disbursements of funds
were made in accordance with the ordinance passed by a local government unit while (2) the
COA has no more than auditorial visitation powers over local government units pursuant to
Section 348 of RA 7160 which provides for the power to inspect at any time the financial
accounts of local government units.

Moreover, the Solicitor General opines that the DBM and the respondent are only authorized
under RA 7160 to promulgate a Budget Operations Manual for local government units, to
improve and systematize methods, techniques and procedures employed in budget
preparation, authorization, execution and accountability pursuant to Section 354 of RA 7160.
The Solicitor General points out that LBC 55 was not exercised under any of the
aforementioned provisions.

Respondent COA, on the other hand, insists that the constitutional and statutory authority of a
city government to provide allowances to judges stationed therein is not absolute. Congress
may set limitations on the exercise of autonomy. It is for the President, through the DBM, to
check whether these legislative limitations are being followed by the local government units.
One such law imposing a limitation on a local government units autonomy is Section 458, par.
(a) (1) [xi], of RA 7160, which authorizes the disbursement of additional allowances and other
benefits to judges subject to the condition that the finances of the city government should allow
the same. Thus, DBM is merely enforcing the condition of the law when it sets a uniform
maximum amount for the additional allowances that a city government can release to judges
stationed therein.

Assuming arguendo that LBC 55 is void, respondent COA maintains that the provisions of the
yearly approved ordinance granting additional allowances to judges are still prohibited by the
appropriation laws passed by Congress every year. COA argues that Mandaue City gets the
funds for the said additional allowances of judges from the Internal Revenue Allotment (IRA).
But the General Appropriations Acts of 1994 and 1995 do not mention the disbursement of
additional allowances to judges as one of the allowable uses of the IRA. Hence, the provisions
of said ordinance granting additional allowances, taken from the IRA, to herein petitioner
judges are void for being contrary to law.

To resolve the instant petition, there are two issues that we must address: (1) whether LBC 55
of the DBM is void for going beyond the supervisory powers of the President and for not having
been published and (2) whether the yearly appropriation ordinance enacted by the City of
Mandaue that provides for additional allowances to judges contravenes the annual
appropriation laws enacted by Congress.

We rule in favor of the petitioner judges.

On the first issue, we declare LBC 55 to be null and void.

We recognize that, although our Constitution[6 guarantees autonomy to local government

units, the exercise of local autonomy remains subject to the power of control by Congress and
the power of supervision by the President. Section 4 of Article X of the 1987 Philippine
Constitution provides that:

Sec. 4. The President of the Philippines shall exercise general supervision over local
governments. x x x

In Pimentel vs. Aguirre[7], we defined the supervisory power of the President and distinguished
it from the power of control exercised by Congress. Thus:

This provision (Section 4 of Article X of the 1987 Philippine Constitution) has been interpreted
to exclude the power of control. In Mondano v. Silvosa,i[5] the Court contrasted the President's
power of supervision over local government officials with that of his power of control over
executive officials of the national government. It was emphasized that the two terms --
supervision and control -- differed in meaning and extent. The Court distinguished them as
follows:

"x x x In administrative law, supervision means overseeing or the power or authority of an

officer to see that subordinate officers perform their duties. If the latter fail or neglect to fulfill
them, the former may take such action or step as prescribed by law to make them perform
their duties. Control, on the other hand, means the power of an officer to alter or modify or
nullify or set aside what a subordinate officer ha[s] done in the performance of his duties and to
substitute the judgment of the former for that of the latter."ii[6]
In Taule v. Santos,iii[7] we further stated that the Chief Executive wielded no more authority
than that of checking whether local governments or their officials were performing their duties
as provided by the fundamental law and by statutes. He cannot interfere with local
governments, so long as they act within the scope of their authority. "Supervisory power, when
contrasted with control, is the power of mere oversight over an inferior body; it does not include
any restraining authority over such body,"iv[8] we said.

In a more recent case, Drilon v. Lim,v[9] the difference between control and supervision was
further delineated. Officers in control lay down the rules in the performance or accomplishment
of an act. If these rules are not followed, they may, in their discretion, order the act undone or
redone by their subordinates or even decide to do it themselves. On the other hand,
supervision does not cover such authority. Supervising officials merely see to it that the rules
are followed, but they themselves do not lay down such rules, nor do they have the discretion
to modify or replace them. If the rules are not observed, they may order the work done or
redone, but only to conform to such rules. They may not prescribe their own manner of
execution of the act. They have no discretion on this matter except to see to it that the rules
are followed.

Under our present system of government, executive power is vested in the President.vi[10]
The members of the Cabinet and other executive officials are merely alter egos. As such, they
are subject to the power of control of the President, at whose will and behest they can be
removed from office; or their actions and decisions changed, suspended or reversed.vii[11] In
contrast, the heads of political subdivisions are elected by the people. Their sovereign powers
emanate from the electorate, to whom they are directly accountable. By constitutional fiat, they
are subject to the Presidents supervision only, not control, so long as their acts are exercised
within the sphere of their legitimate powers. By the same token, the President may not
withhold or alter any authority or power given them by the Constitution and the law.

Clearly then, the President can only interfere in the affairs and activities of a local government
unit if he or she finds that the latter has acted contrary to law. This is the scope of the
Presidents supervisory powers over local government units. Hence, the President or any of his
or her alter egos cannot interfere in local affairs as long as the concerned local government
unit acts within the parameters of the law and the Constitution. Any directive therefore by the
President or any of his or her alter egos seeking to alter the wisdom of a law-conforming
judgment on local affairs of a local government unit is a patent nullity because it violates the
principle of local autonomy and separation of powers of the executive and legislative
departments in governing municipal corporations.

Does LBC 55 go beyond the law it seeks to implement? Yes.

LBC 55 provides that the additional monthly allowances to be given by a local government unit
should not exceed P1,000 in provinces and cities and P700 in municipalities. Section 458, par.
(a)(1)(xi), of RA 7160, the law that supposedly serves as the legal basis of LBC 55, allows the
grant of additional allowances to judges when the finances of the city government allow. The
said provision does not authorize setting a definite maximum limit to the additional allowances
granted to judges. Thus, we need not belabor the point that the finances of a city government
may allow the grant of additional allowances higher than P1,000 if the revenues of the said city
government exceed its annual expenditures. Thus, to illustrate, a city government with locally
generated annual revenues of P40 million and expenditures of P35 million can afford to grant
additional allowances of more than P1,000 each to, say, ten judges inasmuch as the finances
of the city can afford it.

Setting a uniform amount for the grant of additional allowances is an inappropriate way of
enforcing the criterion found in Section 458, par. (a)(1)(xi), of RA 7160. The DBM over-stepped
its power of supervision over local government units by imposing a prohibition that did not
correspond with the law it sought to implement. In other words, the prohibitory nature of the
circular had no legal basis.

Furthermore, LBC 55 is void on account of its lack of publication, in violation of our ruling in
Taada vs. Tuvera[8] where we held that:

xxx. Administrative rules and regulations must also be published if their purpose is to enforce
or implement existing law pursuant to a valid delegation.

Interpretative regulations and those merely internal in nature, that is, regulating only the
personnel of an administrative agency and the public, need not be published. Neither is
publication required of the so-called letters of instruction issued by administrative superiors
concerning the rules or guidelines to be followed by their subordinates in the performance of
their duties.

Respondent COA claims that publication is not required for LBC 55 inasmuch as it is merely an
interpretative regulation applicable to the personnel of an LGU. We disagree. In De Jesus vs.
Commission on Audit[9] where we dealt with the same issue, this Court declared void, for lack
of publication, a DBM circular that disallowed payment of allowances and other additional
compensation to government officials and employees. In refuting respondent COAs argument
that said circular was merely an internal regulation, we ruled that:

On the need for publication of subject DBM-CCC No. 10, we rule in the affirmative. Following
the doctrine enunciated in Taada v. Tuvera, publication in the Official Gazette or in a
newspaper of general circulation in the Philippines is required since DBM-CCC No. 10 is in the
nature of an administrative circular the purpose of which is to enforce or implement an existing
law. Stated differently, to be effective and enforceable, DBM-CCC No. 10 must go through the
requisite publication in the Official Gazette or in a newspaper of general circulation in the
Philippines.

In the present case under scrutiny, it is decisively clear that DBM-CCC No. 10, which
completely disallows payment of allowances and other additional compensation to government
officials and employees, starting November 1, 1989, is not a mere interpretative or internal
regulation. It is something more than that. And why not, when it tends to deprive government
workers of their allowance and additional compensation sorely needed to keep body and soul
together. At the very least, before the said circular under attack may be permitted to
substantially reduce their income, the government officials and employees concerned should
be apprised and alerted by the publication of subject circular in the Official Gazette or in a
newspaper of general circulation in the Philippines to the end that they be given amplest
opportunity to voice out whatever opposition they may have, and to ventilate their stance on
the matter. This approach is more in keeping with democratic precepts and rudiments of
fairness and transparency. (emphasis supplied)

In Philippine International Trading Corporation vs. Commission on Audit[10], we again

declared the same circular as void, for lack of publication, despite the fact that it was re-issued
and then submitted for publication. Emphasizing the importance of publication to the effectivity
of a regulation, we therein held that:

It has come to our knowledge that DBM-CCC No. 10 has been re-issued in its entirety and
submitted for publication in the Official Gazette per letter to the National Printing Office dated
March 9, 1999. Would the subsequent publication thereof cure the defect and retroact to the
time that the above-mentioned items were disallowed in audit?

The answer is in the negative, precisely for the reason that publication is required as a
condition precedent to the effectivity of a law to inform the public of the contents of the law or
rules and regulations before their rights and interests are affected by the same. From the time
the COA disallowed the expenses in audit up to the filing of herein petition the subject circular
remained in legal limbo due to its non-publication. As was stated in Taada v. Tuvera, prior
publication of laws before they become effective cannot be dispensed with, for the reason that
it would deny the public knowledge of the laws that are supposed to govern
it.11cräläwvirtualibräry

We now resolve the second issue of whether the yearly appropriation ordinance enacted by
Mandaue City providing for fixed allowances for judges contravenes any law and should
therefore be struck down as null and void.

According to respondent COA, even if LBC 55 were void, the ordinances enacted by Mandaue
City granting additional allowances to the petitioner judges would still (be) bereft of legal basis
for want of a lawful source of funds considering that the IRA cannot be used for such
purposes. Respondent COA showed that Mandaue Citys funds consisted of locally generated
revenues and the IRA. From 1989 to 1995, Mandaue Citys yearly expenditures exceeded its
locally generated revenues, thus resulting in a deficit. During all those years, it was the IRA
that enabled Mandaue City to incur a surplus. Respondent avers that Mandaue City used its
IRA to pay for said additional allowances and this violated paragraph 2 of the Special
Provisions, page 1060, of RA 7845 (The General Appropriations Act of 1995)[12 and
paragraph 3 of the Special Provision, page 1225, of RA 7663 (The General Appropriations Act
of 1994)[13 which specifically identified the objects of expenditure of the IRA. Nowhere in said
provisions of the two budgetary laws does it say that the IRA can be used for additional
allowances of judges. Respondent COA thus argues that the provisions in the ordinance
providing for such disbursement are against the law, considering that the grant of the subject
allowances is not within the specified use allowed by the aforesaid yearly appropriations acts.

We disagree.

Respondent COA failed to prove that Mandaue City used the IRA to spend for the additional
allowances of the judges. There was no evidence submitted by COA showing the breakdown
of the expenses of the city government and the funds used for said expenses. All the COA
presented were the amounts expended, the locally generated revenues, the deficit, the surplus
and the IRA received each year. Aside from these items, no data or figures were presented to
show that Mandaue City deducted the subject allowances from the IRA. In other words, just
because Mandaue Citys locally generated revenues were not enough to cover its
expenditures, this did not mean that the additional allowances of petitioner judges were taken
from the IRA and not from the citys own revenues.

Moreover, the DBM neither conducted a formal review nor ordered a disapproval of Mandaue
Citys appropriation ordinances, in accordance with the procedure outlined by Sections 326 and
327 of RA 7160 which provide that:

Section 326. Review of Appropriation Ordinances of Provinces, Highly Urbanized Cities,

Independent Component Cities, and Municipalities within the Metropolitan Manila Area. The
Department of Budget and Management shall review ordinances authorizing the annual or
supplemental appropriations of provinces, highly-urbanized cities, independent component
cities, and municipalities within the Metropolitan Manila Area in accordance with the
immediately succeeding Section.
Section 327. Review of Appropriation Ordinances of Component Cities and Municipalities.-
The sangguninang panlalawigan shall review the ordinance authorizing annual or
supplemental appropriations of component cities and municipalities in the same manner and
within the same period prescribed for the review of other ordinances.

If within ninety (90) days from receipt of copies of such ordinance, the sangguniang
panlalawigan takes no action thereon, the same shall be deemed to have been reviewed in
accordance with law and shall continue to be in full force and effect. (emphasis supplied)

Within 90 days from receipt of the copies of the appropriation ordinance, the DBM should have
taken positive action. Otherwise, such ordinance was deemed to have been properly reviewed
and deemed to have taken effect. Inasmuch as, in the instant case, the DBM did not follow the
appropriate procedure for reviewing the subject ordinance of Mandaue City and allowed the
90-day period to lapse, it can no longer question the legality of the provisions in the said
ordinance granting additional allowances to judges stationed in the said city.

WHEREFORE, the petition is hereby GRANTED, and the assailed decision and resolution,
dated September 21, 1995 and May 28, 1996, respectively, of the Commission on Audit are
hereby set aside.

No costs.

SO ORDERED.

G.R. No. 143596 December 11, 2003

JUDGE TOMAS C. LEYNES, petitioner,

vs.
THE COMMISSION ON AUDIT (COA), HON. GREGORIA S. ONG, DIRECTOR,
COMMISSION ON AUDIT and HON. SALVACION DALISAY, PROVINCIAL AUDITOR,
respondents

DECISION

CORONA, J.:

Before us is a petition for certiorari under Rule 65 in relation to Section 2, Rule 64 of the Rules
of Court, seeking to reverse and set aside the decision1 dated September 14, 1999 of the
Commission on Audit (COA), affirming the resolution of COA Regional Director Gregoria S.
Ong dated March 29, 1994 which in turn affirmed the opinion dated October 19, 1993 of the
Provincial Auditor of Oriental Mindoro, Salvacion M. Dalisay. All three denied the grant of
₱1,600 monthly allowance to petitioner Judge Tomas C. Leynes by the Municipality of Naujan,
Oriental Mindoro.
FACTUAL ANTECEDENTS

Petitioner Judge Tomas C. Leynes who, at present, is the presiding judge of the Regional Trial
Court of Calapan City, Oriental Mindoro, Branch 40 was formerly assigned to the Municipality
of Naujan, Oriental Mindoro as the sole presiding judge of the Municipal Trial Court thereof. As
such, his salary and representation and transportation allowance (RATA) were drawn from the
budget of the Supreme Court. In addition, petitioner received a monthly allowance of ₱944
from the local funds2 of the Municipality of Naujan starting 1984.3

On March 15, 1993, the Sangguniang Bayan of Naujan, through Resolution No. 057, sought
the opinion of the Provincial Auditor and the Provincial Budget Officer regarding any budgetary
limitation on the grant of a monthly allowance by the municipality to petitioner judge. On May 7,
1993, the Sangguniang Bayan unanimously approved Resolution No. 101 increasing petitioner
judge’s monthly allowance from ₱944 to ₱1,600 (an increase of ₱656) starting May 1993.4 By
virtue of said resolution, the municipal government (the Municipal Mayor and the Sangguniang
Bayan) approved a supplemental budget which was likewise approved by the Sangguniang
Panlalawigan and the Office of Provincial Budget and Management of Oriental Mindoro. In
1994, the Municipal Government of Naujan again provided for petitioner judge’s ₱1,600
monthly allowance in its annual budget which was again approved by the Sangguniang
Panlalawigan and the Office of Provincial Budget and Management of Oriental Mindoro.5

On February 17, 1994, Provincial Auditor Salvacion M. Dalisay sent a letter to the Municipal
Mayor and the Sangguniang Bayan of Naujan directing them to stop the payment of the
₱1,600 monthly allowance or RATA to petitioner judge and to require the immediate refund of
the amounts previously paid to the latter. She opined that the Municipality of Naujan could not
grant RATA to petitioner judge in addition to the RATA the latter was already receiving from
the Supreme Court. Her directive was based on the following:

Section 36, RA No. 7645, General Appropriations Act of 1993

Representation and Transportation Allowances. The following officials and those of equivalent
rank as may be determined by the Department of Budget and Management (DBM) while in the
actual performance of their respective functions are hereby granted monthly commutable
representation and transportation allowances payable from the programmed appropriations
provided for their respective offices, not exceeding the rates indicated below . . .

National Compensation Circular No. 67 dated January 1, 1992, of the Department of Budget
and Management

Subject: Representation and Transportation Allowances of National Government Officials and

Employees

xxx xxx xxx

4. Funding Source: In all cases, commutable and reimbursable RATA shall be paid from the
amount appropriated for the purpose and other personal services savings of the agency or
project from where the officials and employees covered under this Circular draw their salaries.
No one shall be allowed to collect RATA from more than one source.6 (emphasis supplied)
Petitioner judge appealed to COA Regional Director Gregoria S. Ong who, however, upheld
the opinion of Provincial Auditor Dalisay and who added that Resolution No. 101, Series of
1993 of the Sangguniang Bayan of Naujan failed to comply with Section 3 of Local Budget
Circular No. 53 dated September 1, 1993 outlining the conditions for the grant of allowances to
judges and other national officials or employees by the local government units (LGUs). Section
3 of the said budget circular provides that:

Sec. 3 Allowances. ─ LGUs may grant allowances/additional compensation to the national

government officials/employees assigned to their locality at rates authorized by law, rules and
regulations and subject to the following preconditions:

a. That the annual income or finances of the municipality, city or province as certified by the
Accountant concerned will allow the grant of the allowances/additional compensation without
exceeding the general limitations for personal services under Section 325 of RA 7160;

b. That the budgetary requirements under Section 324 of RA 7160 including the full
requirement of RA 6758 have been satisfied and provided fully in the budget as certified by the
Budget Officer and COA representative in the LGU concerned;

c. That the LGU has fully implemented the devolution of personnel/functions in accordance
with the provisions of RA 7160;

d. That the LGU has already created mandatory positions prescribed in RA 7160; and

e. That similar allowances/additional compensation are not granted by the national government
to the officials/employees assigned to the LGU.7

Petitioner judge appealed the unfavorable resolution of the Regional Director to the
Commission on Audit. In the meantime, a disallowance of the payment of the ₱1,600 monthly
allowance to petitioner was issued. Thus he received his ₱1,600 monthly allowance from the
Municipality of Naujan only for the period May 1993 to January 1994.

On September 14, 1999, the COA issued its decision affirming the resolution of Regional
Director Gregoria S. Ong:

The main issue . . . is whether or not the Municipality of Naujan, Oriental Mindoro can validly
provide RATA to its Municipal Judge, in addition to that provided by the Supreme Court.

Generally, the grant of (RATA) [sic] to qualified national government officials and employees
pursuant to Section 36 of R.A. 7645 [General Appropriations Act of 1993] and NCC No. 67
dated 01 January 1992 is subject to the following conditions to wit:

1. Payable from the programmed /appropriated amount and others from personal services
savings of the respective offices where the officials or employees draw their salaries;

2. Not exceeding the rates prescribed by the Annual General Appropriations Act;
3. Officials /employees on detail with other offices or assigned to serve other offices or
agencies shall be paid from their parent agencies;

4. No one shall be allowed to collect RATA from more than one source.

On the other hand, the municipal government may provide additional allowances and other
benefits to judges and other national government officials or employees assigned or stationed
in the municipality, provided, that the finances of the municipality allow the grant thereof
pursuant to Section 447, Par. 1 (xi), R.A. 7160, and provided further, that similar
allowance/additional compensation are not granted by the national government to the
official/employee assigned to the local government unit as provided under Section 3(e) of
Local Budget Circular No. 53, dated 01 September 1993.

The conflicting provisions of Section 447, Par. (1) (xi) of the Local Government Code of 1991
and Section 36 of the General Appropriations Act of 1993 [RA 7645] have been harmonized by
the Local Budget Circular No. 53 dated 01 September 1993, issued by the Department of
Budget and Management pursuant to its powers under Section 25 and Section 327 of the
Local Government Code. The said circular must be adhered to by the local government units
particularly Section 3 thereof which provides the implementing guidelines of Section 447, Par.
(1) (xi) of the Local Government Code of 1991 in the grant of allowances to national
government officials/employees assigned or stationed in their respective local government
units.

Consequently, the subject SB Resolution No. 101 dated 11 May 1993 of the Sangguniang
Bayan of Naujan, Oriental Mindoro, having failed to comply with the inherent precondition as
defined in Section 3 (e). . . is null and void. Furthermore, the Honorable Judge Tomas C.
Leynes, being a national government official is prohibited to receive additional RATA from the
local government fund pursuant to Section 36 of the General Appropriations Act (R.A. 7645 for
1993) and National Compensation Circular No. 67 dated 1 January 1992.8 (emphasis ours)

ASSIGNMENTS OF ERROR

Petitioner judge filed a motion for reconsideration of the above decision but it was denied by
the Commission in a resolution dated May 30, 2000. Aggrieved, petitioner filed the instant
petition, raising the following assignments of error for our consideration:

WHETHER OR NOT RESOLUTION NO. 1O1, SERIES OF 1993 OF NAUJAN, ORIENTAL

MINDORO, WHICH GRANTED ADDITIONAL ALLOWANCE TO THE MUNICIPAL TRIAL
JUDGE OF NAUJAN, ORIENTAL MINDORO AND INCREASING HIS CURRENT
REPRESENTATION AND TRAVELLING ALLOWANCE (RATA) TO AN AMOUNT
EQUIVALENT TO THAT RECEIVED MONTHLY BY SANGGUNIANG MEMBERS IN PESOS:
ONE THOUSAND SIX HUNDRED (₱1,600.00) EFFECTIVE 1993, IS VALID.

II
WHETHER OR NOT THE POWER OF MUNICIPAL GOVERNMENTS TO GRANT
ADDITIONAL ALLOWANCES AND OTHER BENEFITS TO NATIONAL GOVERNMENT
EMPLOYEES STATIONED IN THEIR MUNICIPALITY IS VERY EXPLICIT AND
UNEQUIVOCAL UNDER THE LOCAL GOVERNMENT CODE OF 1991 PARTICULARLY
SECTION 447 IN RELATION TO SECTIONS 17 AND 22 THEREOF.

III

WHETHER OR NOT THE DEPARTMENT OF BUDGET AND MANAGEMENT (DBM) CAN,

BY THE ISSUANCE OF BUDGET CIRCULARS, RESTRICT A MUNICIPAL GOVERNMENT
FROM EXERCISING ITS GIVEN LEGISLATIVE POWERS OF PROVIDING ADDITIONAL
ALLOWANCES AND OTHER BENEFITS TO NATIONAL EMPLOYEES STATIONED OR
ASSIGNED TO THEIR MUNICIPALITY FOR AS LONG AS THEIR FINANCES SO ALLOW.

IV

WHETHER OR NOT THE LOCAL GOVERNMENT CODE OF 1991 PARTICULARLY

SECTION 447 (a) (1) (xi) WAS EXPRESSLY OR IMPLIEDLY REPEALED OR MODIFIED BY
REPUBLIC ACT 7645 AND THE GENERAL APPROPRIATIONS ACT OF 1993.

WHETHER OR NOT PETITIONER WAS ENTITLED TO RECEIVE THE ADDITIONAL

ALLOWANCES GRANTED TO HIM BY THE MUNICIPALITY OF NAUJAN, ORIENTAL
MINDORO BY VIRTUE OF ITS RESOLUTION NO. 101, SERIES OF 1993.

POSITION OF COA

Respondent Commission on Audit opposes the grant by the Municipality of Naujan of the
₱1,600 monthly allowance to petitioner Judge Leynes for the reason that the municipality could
not grant RATA to judges in addition to the RATA already received from the Supreme Court.9
Respondent bases its contention on the following:

1. National Compensation Circular No. 67 (hereafter NCC No. 67) dated January 1, 1992 of
the Department of Budget and Management (DBM) which provides that (a) the RATA of
national officials and employees shall be payable from the programmed appropriations or
personal services savings of the agency where such officials or employees draw their salary
and (b) no one shall be allowed to collect RATA from more than one source;

2. the General Appropriations Act of 1993 (RA 7645) which provided that the RATA of national
officials shall be payable from the programmed appropriations of their respective offices and

3. Local Budget Circular No. 53 (hereafter LBC No. 53) dated September 1, 1993 of the DBM
which prohibits local government units from granting allowances to national government
officials or employees stationed in their localities when such allowances are also granted by
the national government or are similar to the allowances granted by the national government to
such officials or employees.10
POSITION OF PETITIONER

Petitioner judge, on the other hand, asserts that the municipality is expressly and
unequivocally empowered by RA 7160 (the Local Government Code of 1991) to enact
appropriation ordinances granting allowances and other benefits to judges stationed in its
territory. Section 447(a)(1)(xi) of the Local Government Code of 1991 imposes only one
condition, that is, "when the finances of the municipal government allow." The Code does not
impose any other restrictions in the exercise of such power by the municipality. Petitioner also
asserts that the DBM cannot amend or modify a substantive law like the Local Government
Code of 1991 through mere budget circulars. Petitioner emphasizes that budget circulars must
conform to, not modify or amend, the provisions of the law it seeks to implement.11

HISTORY OF GRANT OF
ALLOWANCES TO JUDGES

The power of local government units (LGUs) to grant allowances to judges stationed in their
respective territories was originally provided by Letter of Instruction No. 1418 dated July 18,
1984 (hereafter LOI No. 1418):

Whereas, the State is cognizant of the need to maintain the independence of the Judiciary;

Whereas, the budgetary allotment of the Judiciary constitutes only a small percentage of the
national budget;

Whereas, present economic conditions adversely affected the livelihood of the members of the
Judiciary;

Whereas, some local government units are ready, willing and able to pay additional allowances
to Judges of various courts within their respective territorial jurisdiction;

Now, therefore, I, Ferdinand E. Marcos, President of the Republic of the Philippines, do hereby
direct:

1. Section 3 of Letter of Implementation No. 96 is hereby amended to read as follows:

"3. The allowances provided in this letter shall be borne exclusively by the National
Government. However, provincial, city and municipal governments may pay additional
allowances to the members and personnel of the Judiciary assigned in their respective areas
out of available local funds but not to exceed ₱1,500.00; Provided, that in Metropolitan Manila,
the city and municipal governments therein may pay additional allowances not exceeding
₱3,000.00. (emphasis ours)"12

On June 25, 1991, the DBM issued Circular No. 91-7 outlining the guidelines for the continued
receipt of allowances by judges from LGUs:
Consistent with the constitutional provision on the fiscal autonomy of the judiciary and the
policy of the National Government of allowing greater autonomy to local government units,
judges of the Judiciary are hereby allowed to continue to receive allowances at the same rates
which they have been receiving from the Local Government Units as of June 30, 1989, subject
to the following guidelines:

1. That the continuance of payment of subject allowance to the recipient judge shall be entirely
voluntary and non-compulsory on the part of the Local Government Units;

2. That payment of the above shall always be subject to the availability of local funds;

3. That it shall be made only in compliance with the policy of non-diminution of compensation
received by the recipient judge before the implementation of the salary standardization;

4. That the subject allowance shall be given only to judges who were receiving the same as of
June 30, 1989 and shall be co-terminous with the incumbent judges; and

5. That the subject allowance shall automatically terminate upon transfer of a judge from one
local government unit to another local government unit. (emphasis ours)

On October 10, 1991, Congress enacted RA 7160, otherwise known as the Local Government
Code of 1991.13 The power of the LGUs to grant allowances and other benefits to judges and
other national officials stationed in their respective territories was expressly provided in
Sections 447(a)(1)(xi), 458(a)(1)(xi) and 468(a)(1)(xi) of the Code.

On March 15, 1994, the DBM issued Local Budget Circular No. 55 (hereafter LBC No. 55)
setting out the maximum amount of allowances that LGUs may grant to judges. For provinces
and cities, the amount should not exceed ₱1,000 and for municipalities, ₱700.

On December 3, 2002, we struck down the above circular in Dadole, et al. vs. COA.14 We
ruled there that the Local Government Code of 1991 clearly provided that LGUs could grant
allowances to judges, subject only to the condition that the finances of the LGUs allowed it. We
held that "setting a uniform amount for the grant of allowances (was) an inappropriate way of
enforcing said criterion." Accordingly, we declared that the DBM exceeded its power of
supervision over LGUs by imposing a prohibition that did not jibe with the Local Government
Code of 1991.15

ESTABLISHED PRINCIPLES INVOLVED

From the foregoing history of the power of LGUs to grant allowances to judges, the following
principles should be noted:

1. the power of LGUs to grant allowances to judges has long been recognized (since 1984 by
virtue of LOI No. 1418) and, at present, it is expressly and unequivocally provided in Sections
447, 458 and 468 of the Local Government Code of 1991;
2. the issuance of DBM Circular No. 91-7 dated June 25, 1991 and LBC No. 55 dated March
15, 1994 indicates that the national government recognizes the power of LGUs to grant such
allowances to judges;

3. in Circular No. 91-7, the national government merely provides the guidelines for the
continued receipt of allowances by judges from LGUs while in LBC No. 55, the national
government merely tries to limit the amount of allowances LGUs may grant to judges and

4. in the recent case of Dadole, et al. vs. COA, the Court upheld the constitutionally enshrined
autonomy of LGUs to grant allowances to judges in any amount deemed appropriate,
depending on availability of funds, in accordance with the Local Government Code of 1991.

OUR RULING

We rule in favor of petitioner judge. Respondent COA erred in opposing the grant of the
₱1,600 monthly allowance by the Municipality of Naujan to petitioner Judge Leynes.

DISCUSSION OF OUR RULING

Section 447(a)(1)(xi) of RA 7160, the Local Government Code of 1991, provides:

(a) The sangguniang bayan, as the legislative body of the municipality, shall enact ordinances,
approve resolutions and appropriate funds for the general welfare of the municipality and its
inhabitants . . ., and shall:

(1) Approve ordinances and pass resolutions necessary for an efficient and effective municipal
government, and in this connection shall:

xxx xxx xxx

(xi) When the finances of the municipal government allow, provide for additional allowances
and other benefits to judges, prosecutors, public elementary and high school teachers, and
other national government officials stationed in or assigned to the municipality; (emphasis
ours)

Respondent COA, however, contends that the above section has been repealed, modified or
amended by NCC No. 67 dated January 1, 1992, RA 7645 (the General Appropriations Act of
1993) and LBC No. 53 dated September 1, 1993.16

It is elementary in statutory construction that an administrative circular cannot supersede,

abrogate, modify or nullify a statute. A statute is superior to an administrative circular, thus the
latter cannot repeal or amend it.17 In the present case, NCC No. 67, being a mere
administrative circular, cannot repeal a substantive law like RA 7160.
It is also an elementary principle in statutory construction that repeal of statutes by implication
is not favored, unless it is manifest that the legislature so intended. The legislature is assumed
to know the existing laws on the subject and cannot be presumed to have enacted inconsistent
or conflicting statutes.18 Respondent COA alleges that Section 36 of RA 7645 (the GAA of
1993) repealed Section 447(a)(l)(xi) of RA 7160 (the LGC of 1991). A review of the two laws,
however, shows that this was not so. Section 36 of RA 7645 merely provided for the different
rates of RATA payable to national government officials or employees, depending on their
position, and stated that these amounts were payable from the programmed appropriations of
the parent agencies to which the concerned national officials or employees belonged.
Furthermore, there was no other provision in RA 7645 from which a repeal of Section 447(a)
(l)(xi) of RA 7160 could be implied. In the absence, therefore, of any clear repeal of Section
447(a)(l)(xi) of RA 7160, we cannot presume such intention on the part of the legislature.

Moreover, the presumption against implied repeal becomes stronger when, as in this case,
one law is special and the other is general.19 The principle is expressed in the maxim
generalia specialibus non derogant, a general law does not nullify a specific or special law.
The reason for this is that the legislature, in passing a law of special character, considers and
makes special provisions for the particular circumstances dealt with by the special law. This
being so, the legislature, by adopting a general law containing provisions repugnant to those of
the special law and without making any mention of its intention to amend or modify such
special law, cannot be deemed to have intended an amendment, repeal or modification of the
latter.20

In this case, RA 7160 (the LGC of 1991) is a special law21 which exclusively deals with local
government units (LGUs), outlining their powers and functions in consonance with the
constitutionally mandated policy of local autonomy. RA 7645 (the GAA of 1993), on the other
hand, was a general law22 which outlined the share in the national fund of all branches of the
national government. RA 7645 therefore, being a general law, could not have, by mere
implication, repealed RA 7160. Rather, RA 7160 should be taken as the exception to RA 7645
in the absence of circumstances warranting a contrary conclusion.23

The controversy actually centers on the seemingly sweeping provision in NCC No. 67 which
states that "no one shall be allowed to collect RATA from more than one source." Does this
mean that judges cannot receive allowances from LGUs in addition to the RATA from the
Supreme Court? For reasons that will hereinafter be discussed, we answer in the negative.

The pertinent provisions of NCC No. 67 read:

3. Rules and Regulations:

3.1.1 Payment of RATA, whether commutable or reimbursable, shall be in accordance with the
rates prescribed for each of the following officials and employees and those of equivalent
ranks, and the conditions enumerated under the pertinent sections of the General Provisions of
the annual General Appropriations Act (GAA):

xxx xxx xxx

4. Funding Source:

In all cases, commutable and reimbursable RATA shall be paid from the amount appropriated
for the purpose and other personal services savings of the agency or project from where the
officials and employees covered under this Circular draw their salaries. No one shall be
allowed to collect RATA from more than one source. (emphasis ours)

In construing NCC No. 67, we apply the principle in statutory construction that force and effect
should not be narrowly given to isolated and disjoined clauses of the law but to its spirit,
broadly taking all its provisions together in one rational view.24 Because a statute is enacted
as a whole and not in parts or sections, that is, one part is as important as the others, the
statute should be construed and given effect as a whole. A provision or section which is
unclear by itself may be clarified by reading and construing it in relation to the whole statute.25

Taking NCC No. 67 as a whole then, what it seeks to prevent is the dual collection of RATA by
a national official from the budgets of "more than one national agency." We emphasize that the
other source referred to in the prohibition is another national agency. This can be gleaned from
the fact that the sentence "no one shall be allowed to collect RATA from more than one
source" (the controversial prohibition) immediately follows the sentence that RATA shall be
paid from the budget of the national agency where the concerned national officials and
employees draw their salaries. The fact that the other source is another national agency is
supported by RA 7645 (the GAA of 1993) invoked by respondent COA itself and, in fact, by all
subsequent GAAs for that matter, because the GAAs all essentially provide that (1) the RATA
of national officials shall be payable from the budgets of their respective national agencies and
(2) those officials on detail with other national agencies shall be paid their RATA only from the
budget of their parent national agency:

Section 36, RA 7645, General Appropriations Act of 1993:

Representation and Transportation Allowances. The following officials and those of equivalent
rank as may be determined by the Department of Budget and Management (DBM) while in the
actual performance of their respective functions are hereby granted monthly commutable
representation and transportation allowances payable from the programmed appropriations
provided for their respective offices, not exceeding the rates indicated below, which shall apply
to each type of allowance:

xxx xxx xxx

Officials on detail with other offices, including officials of the Commission of Audit assigned to
serve other offices or agencies, shall be paid the allowance herein authorized from the
appropriations of their parent agencies. (emphasis ours)

Clearly therefore, the prohibition in NCC No. 67 is only against the dual or multiple collection of
RATA by a national official from the budgets of two or more national agencies. Stated
otherwise, when a national official is on detail with another national agency, he should get his
RATA only from his parent national agency and not from the other national agency he is
detailed to.

Since the other source referred in the controversial prohibition is another national agency, said
prohibition clearly does not apply to LGUs like the Municipality of Naujan. National agency of
course refers to the different offices, bureaus and departments comprising the national
government. The budgets of these departments or offices are fixed annually by Congress in
the General Appropriations Act.26 An LGU is obviously not a national agency. Its annual
budget is fixed by its own legislative council (Sangguniang Bayan, Panlungsod or
Panlalawigan), not by Congress. Without doubt, NCC No. 67 does not apply to LGUs.
The prohibition in NCC No. 67 is in fact an administrative tool of the DBM to prevent the much-
abused practice of multiple allowances, thus standardizing the grant of RATA by national
agencies. Thus, the purpose clause of NCC No. 67 reads:

This Circular is being issued to ensure uniformity and consistency of actions on claims for
representation and transportation allowance (RATA) which is primarily granted by law to
national government officials and employees to cover expenses incurred in the discharge or
performance of their duties and responsibilities.

By no stretch of the imagination can NCC No. 67 be construed as nullifying the power of LGUs
to grant allowances to judges under the Local Government Code of 1991. It was issued
primarily to make the grant of RATA to national officials under the national budget uniform. In
other words, it applies only to the national funds administered by the DBM, not the local funds
of LGUs.

To rule against the power of LGUs to grant allowances to judges as what respondent COA
would like us to do will subvert the principle of local autonomy zealously guaranteed by the
Constitution.27 The Local Government Code of 1991 was specially promulgated by Congress
to ensure the autonomy of local governments as mandated by the Constitution. By upholding,
in the present case, the power of LGUs to grant allowances to judges and leaving to their
discretion the amount of allowances they may want to grant, depending on the availability of
local funds, we ensure the genuine and meaningful local autonomy of LGUs.

We now discuss the next contention of respondent COA: that the resolution of the
Sangguniang Bayan of Naujan granting the ₱1,600 monthly allowance to petitioner judge was
null and void because it failed to comply with LBC No. 53 dated September 1, 1993:

Sec. 3 Allowances. ─ LGUs may grant allowances/additional compensation to the national

government officials/employees assigned to their locality at rates authorized by law, rules and
regulations and subject to the following preconditions:

a. That the annual income or finances of the municipality, city or province as certified by the
Accountant concerned will allow the grant of the allowances/additional compensation without
exceeding the general limitations for personal services under Section 325 of RA 7160;

b. That the budgetary requirements under Section 324 of RA 7160 including the full
requirement of RA 6758 have been satisfied and provided fully in the budget as certified by the
Budget Officer and COA representative in the LGU concerned;

c. That the LGU has fully implemented the devolution of personnel/functions in accordance
with the provisions of RA 7160;

d. That the LGU has already created mandatory positions prescribed in RA 7160.

e. That similar allowances/additional compensation are not granted by the national government
to the officials/employees assigned to the LGU.
Though LBC No. 53 of the DBM may be considered within the ambit of the President's power
of general supervision over LGUs,28 we rule that Section 3, paragraph (e) thereof is invalid.
RA 7160, the Local Government Code of 1991, clearly provides that provincial, city and
municipal governments may grant allowances to judges as long as their finances allow.
Section 3, paragraph (e) of LBC No. 53, by outrightly prohibiting LGUs from granting
allowances to judges whenever such allowances are (1) also granted by the national
government or (2) similar to the allowances granted by the national government, violates
Section 447(a)(l)(xi) of the Local Government Code of 1991.29 As already stated, a circular
must conform to the law it seeks to implement and should not modify or amend it.30

Moreover, by prohibiting LGUs from granting allowances similar to the allowances granted by
the national government, Section 3 (e) of LBC No. 53 practically prohibits LGUs from granting
allowances to judges and, in effect, totally nullifies their statutory power to do so. Being unduly
restrictive therefore of the statutory power of LGUs to grant allowances to judges and being
violative of their autonomy guaranteed by the Constitution, Section 3, paragraph (e) of LBC
No. 53 is hereby declared null and void.1avvphi1

Paragraphs (a) to (d) of said circular, however, are valid as they are in accordance with
Sections 32431 and 32532 of the Local Government Code of 1991; these respectively provide
for the budgetary requirements and general limitations on the use of provincial, city and
municipal funds. Paragraphs (a) to (d) are proper guidelines for the condition provided in
Sections 447, 458 and 468 of the Local Government Code of 1991 that LGUs may grant
allowances to judges if their funds allow.33

Respondent COA also argues that Resolution No. 101 of the Sangguniang Bayan of Naujan
failed to comply with paragraphs (a) to (d) of LBC No. 53, thus it was null and void.

The argument is misplaced.

Guidelines (a) to (d) were met when the Sangguniang Panlalawigan of Oriental Mindoro
approved Resolution No. 101 of the Sangguniang Bayan of Naujan granting the ₱1,600
monthly allowance to petitioner judge as well as the corresponding budgets of the municipality
providing for the said monthly allowance to petitioner judge. Under Section 327 of the Local
Government Code of 1991, the Sangguniang Panlalawigan was specifically tasked to review
the appropriation ordinances of its component municipalities to ensure compliance with
Sections 324 and 325 of the Code. Considering said duty of the Sangguniang Panlalawigan,
we will assume, in the absence of proof to the contrary, that the Sangguniang Panlalawigan of
Oriental Mindoro performed what the law required it to do, that is, review the resolution and the
corresponding budgets of the Municipality of Naujan to make sure that they complied with
Sections 324 and 325 of the Code.34 We presume the regularity of the Sangguniang
Panlalawigan’s official act.

Moreover, it is well-settled that an ordinance must be presumed valid in the absence of

evidence showing that it is not in accordance with the law.35 Respondent COA had the burden
of proving that Resolution No. 101 of the Sangguniang Bayan of Naujan did not comply with
the condition provided in Section 447 of the Code, the budgetary requirements and general
limitations on the use of municipal funds provided in Sections 324 and 325 of the Code and the
implementing guidelines issued by the DBM, i.e., paragraphs (a) to (d), Section 3 of LBC No.
53. Respondent COA also had the burden of showing that the Sangguniang Panlalawigan of
Oriental Mindoro erroneously approved said resolution despite its non-compliance with the
requirements of the law. It failed to discharge such burden. On the contrary, we find that the
resolution of the Municipality of Naujan granting the ₱1,600 monthly allowance to petitioner
judge fully complied with the law. Thus, we uphold its validity.1âwphi1
In sum, we hereby affirm the power of the Municipality of Naujan to grant the questioned
allowance to petitioner Judge Leynes in accordance with the constitutionally mandated policy
of local autonomy and the provisions of the Local Government Code of 1991. We also sustain
the validity of Resolution No. 101, Series of 1993, of the Sangguniang Bayan of Naujan for
being in accordance with the law.

WHEREFORE, the petition is hereby GRANTED. The assailed decision dated September 14,
1999 of the Commission of Audit is hereby SET ASIDE and Section 3, paragraph (e) of LBC
No. 53 is hereby declared NULL and VOID.

No costs.

SO ORDERED.

G.R. Nos. 120865-71 December 7, 1995

LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner,

vs.
COURT OF APPEALS; HON. JUDGE HERCULANO TECH, PRESIDING JUDGE, BRANCH
70, REGIONAL TRIAL COURT OF BINANGONAN RIZAL; FLEET DEVELOPMENT, INC. and
CARLITO ARROYO; THE MUNICIPALITY OF BINANGONAN and/or MAYOR ISIDRO B.
PACIS, respondents.

LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner,

vs.
COURT OF APPEALS; HON. JUDGE AURELIO C. TRAMPE, PRESIDING JUDGE, BRANCH
163, REGIONAL TRIAL COURT OF PASIG; MANILA MARINE LIFE BUSINESS
RESOURCES, INC. represented by, MR. TOBIAS REYNALD M. TIANGCO; MUNICIPALITY
OF TAGUIG, METRO MANILA and/or MAYOR RICARDO D. PAPA, JR., respondents.

LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner,

vs.
COURT OF APPEALS; HON. JUDGE ALEJANDRO A. MARQUEZ, PRESIDING JUDGE,
BRANCH 79, REGIONAL TRIAL COURT OF MORONG, RIZAL; GREENFIELD VENTURES
INDUSTRIAL DEVELOPMENT CORPORATION and R. J. ORION DEVELOPMENT
CORPORATION; MUNICIPALITY OF JALA-JALA and/or MAYOR WALFREDO M. DE LA
VEGA, respondents.

LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner,

vs.
COURT OF APPEALS; HON. JUDGE MANUEL S. PADOLINA, PRESIDING JUDGE,
BRANCH 162, REGIONAL TRIAL COURT OF PASIG, METRO MANILA; IRMA FISHING &
TRADING CORP.; ARTM FISHING CORP.; BDR CORPORATION, MIRT CORPORATION
and TRIM CORPORATION; MUNICIPALITY OF BINANGONAN and/or MAYOR ISIDRO B.
PACIS, respondents.
LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner,
vs.
COURT OF APPEALS; HON. JUDGE ARTURO A. MARAVE, PRESIDING JUDGE, BRANCH
78, REGIONAL TRIAL COURT OF MORONG, RIZAL; BLUE LAGOON FISHING CORP. and
ALCRIS CHICKEN GROWERS, INC.; MUNICIPALITY OF JALA-JALA and/or MAYOR
WALFREDO M. DE LA VEGA, respondents.

LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner,

vs.
COURT OF APPEALS; HON. JUDGE ARTURO A. MARAVE, PRESIDING JUDGE, BRANCH
78, REGIONAL TRIAL COURT OF MORONG, RIZAL; AGP FISH VENTURES, INC.,
represented by its PRESIDENT ALFONSO PUYAT; MUNICIPALITY OF JALA-JALA and/or
MAYOR WALFREDO M. DE LA VEGA, respondents.

LAGUNA LAKE DEVELOPMENT AUTHORITY, petitioner,

vs.
COURT OF APPEALS; HON. JUDGE EUGENIO S. LABITORIA, PRESIDING JUDGE,
BRANCH 161, REGIONAL TRIAL COURT OF PASIG, METRO MANILA; SEA MAR TRADING
CO. INC.; EASTERN LAGOON FISHING CORP.; MINAMAR FISHING CORP.;
MUNICIPALITY OF BINANGONAN and/or MAYOR ISIDRO B. PACIS, respondents.

HERMOSISIMA, JR., J.:

It is difficult for a man, scavenging on the garbage dump created by affluence and profligate
consumption and extravagance of the rich or fishing in the murky waters of the Pasig River and
the Laguna Lake or making a clearing in the forest so that he can produce food for his family,
to understand why protecting birds, fish, and trees is more important than protecting him and
keeping his family alive.

How do we strike a balance between environmental protection, on the one hand, and the
individual personal interests of people, on the other?

Towards environmental protection and ecology, navigational safety, and sustainable

development, Republic Act No. 4850 created the "Laguna Lake Development Authority." This
Government Agency is supposed to carry out and effectuate the aforesaid declared policy, so
as to accelerate the development and balanced growth of the Laguna Lake area and the
surrounding provinces, cities and towns, in the act clearly named, within the context of the
national and regional plans and policies for social and economic development.

Presidential Decree No. 813 of former President Ferdinand E. Marcos amended certain
sections of Republic Act No. 4850 because of the concern for the rapid expansion of
Metropolitan Manila, the suburbs and the lakeshore towns of Laguna de Bay, combined with
current and prospective uses of the lake for municipal-industrial water supply, irrigation,
fisheries, and the like. Concern on the part of the Government and the general public over: —
the environment impact of development on the water quality and ecology of the lake and its
related river systems; the inflow of polluted water from the Pasig River, industrial, domestic
and agricultural wastes from developed areas around the lake; the increasing urbanization
which induced the deterioration of the lake, since water quality studies have shown that the
lake will deteriorate further if steps are not taken to check the same; and the floods in
Metropolitan Manila area and the lakeshore towns which will influence the hydraulic system of
Laguna de Bay, since any scheme of controlling the floods will necessarily involve the lake and
its river systems, — likewise gave impetus to the creation of the Authority.

Section 1 of Republic Act No. 4850 was amended to read as follows:

Sec. 1. Declaration of Policy. It is hereby declared to be the national policy to promote,

and accelerate the development and balanced growth of the Laguna Lake area and the
surrounding provinces, cities and towns hereinafter referred to as the region, within the context
of the national and regional plans and policies for social and economic development and to
carry out the development of the Laguna Lake region with due regard and adequate provisions
for environmental management and control, preservation of the quality of human life and
ecological systems, and the prevention of undue ecological disturbances, deterioration and
pollution.1

Special powers of the Authority, pertinent to the issues in this case, include:

Sec. 3. Section 4 of the same Act is hereby further amended by adding thereto seven
new paragraphs to be known as paragraphs (j), (k), (l), (m), (n), (o), and (p) which shall read as
follows:

xxx xxx xxx

(j) The provisions of existing laws to the contrary notwithstanding, to engage in fish
production and other aqua-culture projects in Laguna de Bay and other bodies of water within
its jurisdiction and in pursuance thereof to conduct studies and make experiments, whenever
necessary, with the collaboration and assistance of the Bureau of Fisheries and Aquatic
Resources, with the end in view of improving present techniques and practices. Provided, that
until modified, altered or amended by the procedure provided in the following sub-paragraph,
the present laws, rules and permits or authorizations remain in force;

(k) For the purpose of effectively regulating and monitoring activities in Laguna de Bay, the
Authority shall have exclusive jurisdiction to issue new permit for the use of the lake waters for
any projects or activities in or affecting the said lake including navigation, construction, and
operation of fishpens, fish enclosures, fish corrals and the like, and to impose necessary
safeguards for lake quality control and management and to collect necessary fees for said
activities and projects: Provided, That the fees collected for fisheries may be shared between
the Authority and other government agencies and political sub-divisions in such proportion as
may be determined by the President of the Philippines upon recommendation of the Authority's
Board: Provided, further, That the Authority's Board may determine new areas of fishery
development or activities which it may place under the supervision of the Bureau of Fisheries
and Aquatic Resources taking into account the overall development plans and programs for
Laguna de Bay and related bodies of water: Provided, finally, That the Authority shall subject
to the approval of the President of the Philippines promulgate such rules and regulations which
shall govern fisheries development activities in Laguna de Bay which shall take into
consideration among others the following: socio-economic amelioration of bonafide resident
fishermen whether individually or collectively in the form of cooperatives, lakeshore town
development, a master plan for fishpen construction and operation, communal fishing ground
for lake shore town residents, and preference to lake shore town residents in hiring laborer for
fishery projects;
(l) To require the cities and municipalities embraced within the region to pass appropriate
zoning ordinances and other regulatory measures necessary to carry out the objectives of the
Authority and enforce the same with the assistance of the Authority;

(m) The provisions of existing laws to the contrary notwithstanding, to exercise water rights
over public waters within the Laguna de Bay region whenever necessary to carry out the
Authority's projects;

(n) To act in coordination with existing governmental agencies in establishing water quality
standards for industrial, agricultural and municipal waste discharges into the lake and to
cooperate with said existing agencies of the government of the Philippines in enforcing such
standards, or to separately pursue enforcement and penalty actions as provided for in Section
4 (d) and Section 39-A of this Act: Provided, That in case of conflict on the appropriate water
quality standard to be enforced such conflict shall be resolved thru the NEDA Board.2

To more effectively perform the role of the Authority under Republic Act No. 4850, as though
Presidential Decree No. 813 were not thought to be completely effective, the Chief Executive,
feeling that the land and waters of the Laguna Lake Region are limited natural resources
requiring judicious management to their optimal utilization to insure renewability and to
preserve the ecological balance, the competing options for the use of such resources and
conflicting jurisdictions over such uses having created undue constraints on the institutional
capabilities of the Authority in the light of the limited powers vested in it by its charter,
Executive Order No. 927 further defined and enlarged the functions and powers of the
Authority and named and enumerated the towns, cities and provinces encompassed by the
term "Laguna de Bay Region".

Also, pertinent to the issues in this case are the following provisions of Executive Order No.
927 which include in particular the sharing of fees:

Sec 2. Water Rights Over Laguna de Bay and Other Bodies of Water within the Lake Region:
To effectively regulate and monitor activities in the Laguna de Bay region, 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.

For the purpose of this Executive Order, the term "Laguna de Bay Region" shall refer to the
Provinces of Rizal and Laguna; the Cities of San Pablo, Pasay, Caloocan, Quezon, Manila and
Tagaytay; the towns of Tanauan, Sto. Tomas and Malvar in Batangas Province; the towns of
Silang and Carmona in Cavite Province; the town of Lucban in Quezon Province; and the
towns of Marikina, Pasig, Taguig, Muntinlupa, and Pateros in Metro Manila.

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, and waste 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 the Authority's Board, except fishpen fee,
which will be shared in the following manner; 20 percent of the fee shall go to the lakeshore
local 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 Lake Fishery
Zoning and Management Plan, the sharing will be modified as follows: 35 percent of the
fishpen fee goes to the lakeshore local governments, 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 an exception to the provisions of Presidential Decree No. 1234.
(Emphasis supplied)

It is important to note that Section 29 of Presidential Decree No. 813 defined the term "Laguna
Lake" in this manner:

Sec 41. Definition of Terms.

(11) Laguna Lake or Lake. Whenever Laguna Lake or lake is used in this Act, the same shall
refer to Laguna de Bay which is that area covered by the lake water when it is at the average
annual maximum lake level of elevation 12.50 meters, as referred to a datum 10.00 meters
below mean lower low water (M.L.L.W). Lands located at and below such elevation are public
lands which form part of the bed of said lake.

Then came Republic Act No. 7160, the Local Government Code of 1991. The municipalities in
the Laguna Lake Region interpreted the provisions of this law to mean 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 the
municipal waters and impose rental fees or charges therefor in accordance with the provisions
of this Section.

(b) The Sangguniang Bayan may:

(1) Grant fishing privileges to erect fish corrals, oyster, mussel or other aquatic beds or
bangus fry areas, within a definite zone of the municipal waters, as determined by it; . . . .

(2) Grant privilege to gather, take or catch bangus fry, prawn fry or kawag-kawag or fry of
other species and fish from the municipal waters by nets, traps or other fishing gears to
marginal fishermen free from any rental fee, charges or any other imposition whatsoever.

xxx xxx xxx

Sec. 447. Power, Duties, Functions and Compensation. . . . .

xxx xxx xxx

(XI) Subject to the provisions of Book II of this Code, grant exclusive privileges of
constructing fish corrals or fishpens, or the taking or catching of bangus fry, prawn fry or
kawag-kawag or fry of any species or fish within the municipal waters.
xxx xxx xxx

Municipal governments thereupon assumed the authority to issue fishing privileges and
fishpen permits. Big fishpen operators took advantage of the occasion to establish fishpens
and fishcages to the consternation of the Authority. Unregulated fishpens and fishcages, as of
July, 1995, occupied almost one-third of the entire lake water surface area, increasing the
occupation drastically from 7,000 hectares in 1990 to almost 21,000 hectares 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.

To be sure, the implementation by the lakeshore municipalities of separate independent

policies in the operation of fishpens and fishcages within their claimed territorial municipal
waters in the lake and their indiscriminate grant of fishpen permits have already saturated the
lake area with fishpens, thereby aggravating the current environmental problems and
ecological stress of Laguna Lake.

In view of the foregoing circumstances, the Authority served notice to the general public that:

In compliance with the instructions of His Excellency PRESIDENT FIDEL V. RAMOS given on
June 23, 1993 at Pila, Laguna pursuant to Republic Act 4850 as amended by Presidential
Decree 813 and Executive Order 927 series of 1983 and in line with the policies and programs
of the Presidential Task Force on Illegal Fishpens and Illegal Fishing, the general public is
hereby notified that:

1. All fishpens, fishcages and other aqua-culture structures in the Laguna de Bay Region,
which were not registered or to which no application for registration and/or permit has been
filed with Laguna Lake Development Authority as of March 31, 1993 are hereby declared
outrightly as illegal.

2. All fishpens, fishcages and other aqua-culture structures so declared as illegal shall be
subject to demolition which shall be undertaken 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 the same
laws. Violations of these laws carries a penalty of imprisonment of not exceeding 3 years or a
fine not exceeding Five Thousand Pesos 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 shall have 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 and other aqua-culture structures advising them to dismantle
their respective structures within 10 days from receipt thereof, otherwise, demolition shall be
effected.
Reacting thereto, the affected fishpen owners filed injunction cases against the Authority
before various regional trial courts, to wit: (a) Civil Case No. 759-B, for Prohibition, Injunction
and Damages, Regional Trial Court, Branch 70, Binangonan, Rizal, filed by Fleet
Development, Inc. and Carlito Arroyo; (b) Civil Case No. 64049, for Injunction, Regional Trial
Court, Branch 162, Pasig, filed by IRMA Fishing and Trading Corp., ARTM Fishing Corp., BDR
Corp., MIRT Corp. and TRIM Corp.; (c) Civil Case No. 566, for Declaratory Relief and
Injunction, Regional Trial Court, Branch 163, Pasig, filed by Manila Marine Life Business
Resources, Inc. and Tobias Reynaldo M. Tianco; (d) Civil Case No. 556-M, for Prohibition,
Injunction and Damages, Regional Trial Court, Branch 78, Morong, Rizal, filed by AGP Fishing
Ventures, Inc.; (e) Civil Case No. 522-M, for Prohibition, Injunction and Damages, Regional
Trial Court, Branch 78, Morong, Rizal, filed by Blue Lagoon and Alcris Chicken Growers, Inc.;
(f) Civil Case No. 554-, for Certiorari and Prohibition, Regional Trial Court, Branch 79, Morong,
Rizal, filed by Greenfields Ventures Industrial Corp. and R.J. Orion Development Corp.; and
(g) Civil Case No. 64124, for Injunction, Regional Trial Court, Branch 15, Pasig, filed by SEA-
MAR Trading Co., Inc. and Eastern Lagoon Fishing Corp. and Minamar Fishing Corporation.

The Authority filed motions to dismiss the cases against it on jurisdictional grounds. The
motions to dismiss were invariably denied. Meanwhile, temporary restraining order/writs of
preliminary mandatory injunction were issued in Civil Cases Nos. 64124, 759 and 566
enjoining the Authority from demolishing the fishpens and similar structures in question.

Hence, the herein petition for certiorari, prohibition and injunction, G.R. Nos. 120865-71, were
filed by the Authority with this court. Impleaded as parties-respondents are concerned regional
trial courts and respective private parties, and the municipalities and/or respective Mayors of
Binangonan, Taguig and Jala-jala, who issued permits for the construction and operation of
fishpens in Laguna de Bay. The Authority sought the following reliefs, viz.:

(A) Nullification of the temporary restraining order/writs of preliminary injunction issued in

Civil Cases Nos. 64125, 759 and 566;

(B) Permanent prohibition against the regional trial courts from exercising jurisdiction over
cases involving the Authority which is a co-equal body;

(C) Judicial pronouncement that R.A. 7610 (Local Government Code of 1991) did not
repeal, alter or modify the provisions of R.A. 4850, as amended, empowering the Authority to
issue permits for fishpens, fishcages and other aqua-culture structures in Laguna de Bay and
that, the Authority the government agency vested with exclusive authority to issue said
permits.

By this Court's resolution of May 2, 1994, the Authority's consolidated petitions were referred
to the Court of Appeals.

In a Decision, dated June 29, 1995, the Court of Appeals dismissed the Authority's
consolidated petitions, the Court of Appeals holding that: (A) LLDA is not among those quasi-
judicial agencies of government whose decision or order are appealable only to the Court of
Appeals; (B) the LLDA charter does vest LLDA with quasi-judicial functions insofar as fishpens
are concerned; (C) the provisions of the LLDA charter insofar as fishing privileges in Laguna
de Bay are concerned had been repealed by the Local Government Code of 1991; (D) in view
of the aforesaid repeal, the power to grant permits devolved to and is now vested with their
respective local government units concerned.
Not satisfied with the Court of Appeals decision, the Authority has returned to this Court
charging the following errors:

1. THE HONORABLE COURT OF APPEALS PROBABLY COMMITTED AN ERROR

WHEN IT RULED THAT THE LAGUNA LAKE DEVELOPMENT AUTHORITY IS NOT A
QUASI-JUDICIAL AGENCY.

2. THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERROR WHEN IT

RULED THAT R.A. 4850 AS AMENDED BY P.D. 813 AND E.O. 927 SERIES OF 1983 HAS
BEEN REPEALED BY REPUBLIC ACT 7160. THE SAID RULING IS CONTRARY TO
ESTABLISHED PRINCIPLES AND JURISPRUDENCE OF STATUTORY CONSTRUCTION.

3. THE HONORABLE COURT OF APPEALS COMMITTED SERIOUS ERROR WHEN IT

RULED THAT THE POWER TO ISSUE FISHPEN PERMITS IN LAGUNA DE BAY HAS BEEN
DEVOLVED TO CONCERNED (LAKESHORE) LOCAL GOVERNMENT UNITS.

We take a simplistic view of the controversy. Actually, the main and only issue posed is: Which
agency of the Government — the Laguna Lake Development Authority 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?

Section 4 (k) of the charter of the Laguna Lake Development Authority, Republic Act No. 4850,
the provisions of Presidential Decree No. 813, and Section 2 of Executive Order No. 927, cited
above, specifically provide that the Laguna Lake Development Authority shall have exclusive
jurisdiction to issue permits 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. On the other hand, Republic Act No. 7160, the Local
Government Code of 1991, has granted to the municipalities the exclusive authority to grant
fishery privileges in municipal waters. The Sangguniang Bayan may grant fishery privileges to
erect fish corrals, oyster, mussels or other aquatic beds or bangus fry area within a definite
zone of the municipal waters.

We hold that the provisions of Republic Act No. 7160 do not necessarily repeal the
aforementioned laws creating the Laguna Lake Development Authority 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 its amendments.
The repeal of laws should be made clear and expressed.

It has to be conceded that the charter of the Laguna Lake Development Authority constitutes a
special law. Republic Act No. 7160, the Local Government Code of 1991, is a general law. It is
basic in statutory construction that the enactment of a later legislation which is a general law
cannot be construed to have repealed a special law. 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 by a
subsequent statute, general in its terms, provisions and application, unless the intent to repeal
or alter is manifest, although the terms of the general law are broad enough to include the
cases embraced in the special law."3
Where there is a conflict between a general law and a special statute, the special statute
should prevail since it evinces the legislative intent more clearly than 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, effect must be given to all enactments of the legislature. A special
law cannot be repealed, amended or altered by a subsequent general law by mere
implication.4

Thus, it has to be concluded that the charter of the Authority should prevail over the Local
Government Code of 1991.

Considering the reasons behind the establishment of the Authority, which are environmental
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 petitioner Laguna Lake Development Authority
that "Laguna de Bay, like any other single body of water has its own unique natural ecosystem.
The 900 km² lake surface water, the eight (8) major river tributaries and several other smaller
rivers that drain into the lake, the 2,920 km² basin or watershed transcending the boundaries of
Laguna and Rizal provinces, greater portion of Metro Manila, parts of Cavite, Batangas, and
Quezon provinces, constitute one integrated delicate natural ecosystem that needs to be
protected with uniform set of policies; if we are to be serious in our aims of attaining
sustainable development. This is an exhaustible natural resource — a very limited one —
which requires judicious management and optimal utilization to ensure renewability and
preserve its ecological integrity and balance."

"Managing the lake resources would mean the implementation of a national policy geared
towards the protection, conservation, balanced growth and sustainable development of the
region with due regard to the inter-generational use of its resources by the inhabitants in this
part of the earth. The authors of Republic Act 4850 have foreseen this need when they passed
this LLDA law — the special law designed to govern the management of our Laguna de Bay
lake resources."

"Laguna de Bay therefore cannot be subjected to fragmented concepts of management

policies where lakeshore local government units exercise exclusive dominion over specific
portions of the lake water. The garbage thrown or sewage discharged into the lake, abstraction
of water therefrom or construction of fishpens by enclosing its certain area, affect not only that
specific portion but the entire 900 km² of lake water. The implementation of a cohesive and
integrated lake water resource management policy, therefore, is necessary to conserve,
protect and sustainably develop Laguna de Bay."5

The power of the local government units to issue fishing privileges was clearly granted for
revenue purposes. This is evident from the fact that Section 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 Local Government Units."

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 (Section 2, Executive Order No. 927) and for lake quality control and
management.6 It does partake of the nature of police power which is the most pervasive, the
least limitable and the most demanding of 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.
There should be no quarrel over permit fees for fishpens, fishcages and other aqua-culture
structures in the Laguna de Bay area. 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 this Court in Laguna Lake
Development Authority vs. Court of Appeals, 231 SCRA 304, 306, which we quote:

xxx xxx xxx

As a general rule, the adjudication of pollution cases generally pertains to the Pollution
Adjudication Board (PAB), except in cases where the special law provides for another forum. It
must be recognized in this regard that the LLDA, as a specialized administrative agency, is
specifically mandated under Republic Act No. 4850 and its amendatory laws to carry out and
make effective the declared national policy of promoting and accelerating the development and
balanced growth of the Laguna Lake area and the surrounding provinces of Rizal and Laguna
and the cities of San Pablo, Manila, Pasay, Quezon and Caloocan with due regard and
adequate provisions for environmental management and control, preservation of the quality of
human life and ecological systems, and the prevention of undue ecological disturbances,
deterioration and pollution. Under such a broad grant of power and authority, the LLDA, by
virtue of its special charter, obviously has the responsibility to protect the inhabitants of the
Laguna Lake region from the deleterious effects of pollutants emanating from the discharge of
wastes from the surrounding areas. In carrying out the aforementioned declared policy, the
LLDA is mandated, among others, to pass upon and approve or disapprove all plans,
programs, and projects proposed by local government offices/agencies within the region,
public corporations, and private persons or enterprises where such plans, programs and/or
projects are related to those of the LLDA for the development of the region.

xxx xxx xxx

. . . . While it is a fundamental rule that an administrative agency has only such powers as are
expressly granted to it by law, it is likewise a settled rule that an administrative agency has
also such powers as are necessarily implied in the exercise of its express powers. In the
exercise, therefore, of its express powers under its charter, as a regulatory and quasi-judicial
body with respect to pollution cases in the Laguna Lake region, the authority of the LLDA to
issue a "cease and desist order" is, perforce, implied. Otherwise, it may well be reduced to a
"toothless" paper agency.

there is no question that the Authority has express powers as a regulatory and quasi-judicial
body in respect to pollution cases with authority to issue a "cease and desist order" and on
matters affecting the 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 its charter, the Regional Trial Courts
have jurisdiction.

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

Removal from the Authority of the aforesaid licensing authority will render nugatory its avowed
purpose of protecting and developing the Laguna Lake Region. Otherwise stated, the
abrogation of this power would render useless its reason for being and will in effect denigrate,
if not abolish, the Laguna Lake Development Authority. This, the Local Government Code of
1991 had never intended to do.

WHEREFORE, the petitions for prohibition, certiorari and injunction are hereby granted, insofar
as they relate to the authority of the Laguna Lake Development Authority to grant fishing
privileges within the Laguna Lake Region.

The restraining orders and/or writs of injunction issued by Judge Arturo Marave, RTC, Branch
78, Morong, Rizal; Judge Herculano Tech, RTC, Branch 70, Binangonan, Rizal; and Judge
Aurelio Trampe, RTC, Branch 163, Pasig, Metro Manila, are hereby declared null and void and
ordered set aside for having been issued with grave abuse of discretion.

The Municipal Mayors of the Laguna Lake Region are hereby prohibited from issuing permits
to construct and operate fishpens, fishcages and other aqua-culture structures within the
Laguna Lake Region, their previous issuances being declared null and void. Thus, the fishing
permits issued by Mayors Isidro B. Pacis, Municipality of Binangonan; Ricardo D. Papa,
Municipality of Taguig; and Walfredo M. de la Vega, Municipality of Jala-jala, specifically, are
likewise declared null and void and ordered cancelled.

The fishpens, fishcages and other aqua-culture structures put up by operators by virtue of
permits issued by Municipal Mayors within the Laguna Lake Region, specifically, permits
issued to Fleet Development, Inc. and Carlito Arroyo; Manila Marine Life Business Resources,
Inc., represented by, Mr. Tobias Reynald M. Tiangco; Greenfield Ventures Industrial
Development Corporation and R.J. Orion Development Corporation; IRMA Fishing And
Trading Corporation, ARTM Fishing Corporation, BDR Corporation, Mirt Corporation and Trim
Corporation; Blue Lagoon Fishing Corporation and ALCRIS Chicken Growers, Inc.; AGP Fish
Ventures, Inc., represented by its President Alfonso Puyat; SEA MAR Trading Co., Inc.,
Eastern Lagoon Fishing Corporation, and MINAMAR Fishing Corporation, are hereby declared
illegal structures subject to demolition by the Laguna Lake Development Authority.

SO ORDERED.
G.R. No. 111511 October 5, 1993

ENRIQUE T. GARCIA, ET AL., petitioners,

vs.
COMMISSION ON ELECTIONS and LUCILA PAYUMO, ET AL., respondents.

Alfonso M. Cruz Law Offices for petitioners.

Romulo C. Felizmeña, Crisostomo Banzon and Horacio Apostol for private respondents.

PUNO, J.:

The EDSA revolution of 1986 restored the reality that the people's might is not a myth. The
1987 Constitution then included people power as an article of faith and Congress was
mandated to p ass laws for its effective exercise. The Local Government Code of 1991 was
enacted providing for two (2) modes of initiating the recall from office of local elective officials
who appear to have lost the confidence of the electorate. One of these modes is recall through
the initiative of a preparatory recall assembly. In the case at bench, petitioners assail this mode
of initiatory recall as unconstitutional. The challenge cannot succeed.

We shall first unfurl the facts.

Petitioner Enrique T. Garcia was elected governor of the province of Bataan in the May 11,
1992 elections. In the early evening of July 1993, some mayors, vice-mayors and members of
the Sangguniang Bayan of the twelve (12) municipalities of the province met at the National
Power Corporation compound in Bagac, Bataan. At about 12:30 A.M of the following day, July
2, 1993, they proceeded to the Bagac town plaza where they constituted themselves into a
Preparatory Recall Assembly to initiate the recall election of petitioner Garcia. The mayor of
Mariveles, Honorable Oscar, de los Reyes, and the mayor of Dinalupihan, the Honorable
Lucila Payumo, were chosen as Presiding Officer and Secretary of the Assembly, respectively.
Thereafter, the Vice-Mayor of Limay, the Honorable Ruben Roque, was recognized and he
moved that a resolution be passed for the recall of the petitioner on the ground of "loss of
confidence."1 The motion was "unanimously seconded."2 The resolution states:

RESOLUTION NO. 1

Whereas, the majority of all the members of the Preparatory Recall Assembly in the Province
of Bataan have voluntarily constituted themselves for the purpose of the recall of the
incumbent provincial governor of the province of Bataan, Honorable Enrique T. Garcia
pursuant to the provisions of Section 70, paragraphs (a), (b) and (c) of Republic Act 7160,
otherwise known as the Local Government Code of 1991;
Whereas, the total number of all the members of the Preparatory Recall Assembly in the
province of Bataan is One Hundred and Forty- Six (146) composed of all mayors, vice-mayors
and members of the Sangguniang Bayan of all the 12 towns of the province of Bataan;

Whereas, the majority of all the members of the Preparatory Recall Assembly, after a serious
and careful deliberation have decided to adopt this resolution for the recall of the incumbent
provincial governor Garcia for loss of confidence;

Now, therefore, be it resolved, as it is hereby resolved that having lost confidence on the
incumbent governor of Bataan, Enrique T. Garcia, recall proceedings be immediately initiated
against him;

Resolved further, that copy of this resolution be furnished the Honorable Commission on
Elections, Manila and the Provincial Election Supervisor, Balanga, Bataan.

One hundred forty-six (146) names appeared in Resolution No. 1 but only eighty (80) carried
the signatures of the members of the PRA. Of the eighty (80) signatures, only seventy-four
(74) were found genuine.3 The PRAC of the province had a membership of one hundred forty-
four (144)4 and its majority was seventy-three (73).

On July 7, 1993, petitioners filed with the respondent COMELEC a petition to deny due course
to said Resolution No. 1. Petitioners alleged that the PRAC failed to comply with the
"substantive and procedural requirement" laid down in Section 70 of R.A. 7160, otherwise
known as the Local Government Code of 1991. In a per curiam Resolution promulgated
August 31, 1993, the respondent COMELEC dismissed the petition and scheduled the recall
elections for the position of Governor of Bataan on October 11 , 1993. Petitioners then filed
with Us a petition for certiorari and prohibition with writ of preliminary injunction to annul the
said Resolution of the respondent COMELEC on various grounds. They urged that section 70
of R.A. 7160 allowing recall through the initiative of the PRAC is unconstitutional because: (1)
the people have the sole and exclusive right to decide whether or not to initiate proceedings,
and (2) it violated the right of elected local public officials belonging to the political minority to
equal protection of law. They also argued that the proceedings followed by the PRAC in
passing Resolution No. I suffered from numerous defects, the most fatal of which was the
deliberate failure to send notices of the meeting to sixty-five (65) members of the assembly. On
September 7, 1993, We required the respondents to file their Comments within a non-
extendible period of ten (10) days.5 On September 16, 1993, We set petition for hearing on
September 21, 1993 at 11 A.M. After the hearing, We granted the petition on ground that the
sending of selective notices to members of the PRAC violated the due process protection of
the Constitution and fatally flawed the enactment of Resolution No. 1. We ruled:

xxx xxx xxx

After deliberation, the Court opts not to resolve the alleged constitutional infirmity of sec. 70 of
R.A. No. 7160 for its resolution is not unavoidable to decide the merits of the petition. The
petition can be decided on the equally fundamental issues of: (1) whether or not all the
members of the Preparatory Recall Assembly were notified of its meeting; and (2) assuming
lack of notice, whether or not it would vitiate the proceedings of the assembly including its
Resolution No. 1.

The failure to give notice to all members of the assembly, especially to the members known to
be political allies of petitioner Garcia was admitted by both counsels of the respondents. They
did not deny that only those inclined to agree with the resolution of recall were notified as a
matter of political strategy and security. They justified these selective notices on the ground
that the law does not specifically mandate the giving of notice.

We reject this submission of the respondents. The due process clause of the Constitution
requiring notice as an element of fairness is inviolable and should always be considered as
part and parcel of every law in case of its silence. The need for notice to all the members of the
assembly is also imperative for these members represent the different sectors of the electorate
of Bataan. To the extent that they are not notified of the meeting of the assembly, to that extent
is the sovereign voice of the people they represent nullified. The resolution to recall should
articulate the majority will of the members of the assembly but the majority will can be
genuinely determined only after all the members of the assembly have been given a fair
opportunity to express the will of their constituents. Needless to stress, the requirement of
notice is indispensable in determining the collective wisdom of the members of the Preparatory
Recall Assembly. Its non-observance is fatal to the validity of the resolution to recall petitioner
Garcia as Governor of the province of Bataan.

The petition raises other issues that are not only prima impressionis but also of transcendental
importance to the rightful exercise of the sovereign right of the people to recall their elected
officials. The Court shall discuss these issues in a more extended decision.

In accord with this Resolution, it appears that on September 22, 1993, the Honorable Mayor of
Dinalupihan, Oscar de los Reyes again sent Notice of Session to the members of the PRAC to
"convene in session on September 26, 1993 at the town plaza of Balanga, Bataan at 8:30
o'clock in the morning."6 From news reports, the PRAC convened in session and eighty-seven
(87) of its members once more passed a resolution calling for the recall of petitioner Garcia.7
On September 27, 1993, petitioners filed with Us a Supplemental Petition and Reiteration of
Extremely Urgent Motion for a resolution of their contention that section 70 of R.A. 7160 is
unconstitutional.

We find the original Petition and the Supplemental Petition assailing the constitutionality of
section 70 of R.A. 7160 insofar as it allows a preparatory recall assembly initiate the recall of
local elective officials as bereft of merit.

Every law enjoys the presumption of validity. The presumption rests on the respect due to the
wisdom, integrity, and the patriotism of the legislative, by which the law is passed, and the
Chief Executive, by whom the law is
approved,8 For upholding the Constitution is not the responsibility of the judiciary alone but
also the duty of the legislative and executive.9 To strike down a law as unconstitutional, there
must be a clear and unequivocal showing that what the fundamental law prohibits, the statute
permits.10 The annulment cannot be decreed on a doubtful, and arguable implication. The
universal rule of legal hermeneutics is that all reasonable doubts should be resolved in favor of
the constitutionality of a law. 11

Recall is a mode of removal of a public officer by the people before the end of his term of
office. The people's prerogative to remove a public officer is an incident of their sovereign
power and in the absence of constitutional restraint, the power is implied in all governmental
operations. Such power has been held to be indispensable for the proper administration of
public affairs. 12 Not undeservedly, it is frequently described as a fundamental right of the
people in a representative democracy. 13

Recall is a mode of removal of elective local officials made its maiden appearance in our 1973
Constitution.14 It was mandated in section 2 of Article XI entitled Local Government, viz:
Sec. 2. The Batasang Pambansa shall enact a local government code which may not
thereafter be amended except by a majority vote of all its Members, defining a more
responsive and accountable local government structure with an effective system of recall,
allocating among the different local government units their powers, responsibilities, and
resources, and providing for the qualifications, election and removal, term, salaries, powers,
functions, and duties of local officials, and all other matters relating to the organization and
operation of the local units. However, any change in the existing form of local government shall
not take effect until ratified by a majority of the votes cast in a plebiscite called for the purpose.
(Emphasis supplied)

The Batasang Pambansa then enacted BP 337 entitled "The Local Government Code of
1983." Section 54 of its Chapter 3 provided only one mode of initiating the recall elections of
local elective officials, i.e., by petition of at least twenty-five percent (25%) of the total number
of registered voters in the local government unit concerned, viz:

Sec. 54. By Whom Exercised; Requisites. — (1) The power of recall shall be exercised by
the registered voters of the unit to which the local elective official subject to such recall
belongs.

(2) Recall shall be validly initiated only upon petition of at least twenty-five percent (25%) of
the total number of registered voters in the local government unit concerned based on the
election in which the local official sought to be recalled was elected.

Our legal history does not reveal any instance when this power of recall as provided by BP 337
was exercised by our people.

In February 1986, however, our people more than exercised their right of recall for they
resorted to revolution and they booted of office the highest elective officials of the land.

The successful use of people power to remove public officials who have forfeited the trust of
the electorate led to its firm institutionalization in the 1987 Constitution. Its Article XIII expressly
recognized the Role and Rights of People's Organizations, viz:

Sec. 15. The State shall respect the role of independent people's organizations to enable
the people to pursue and protect, within the democratic framework, their legitimate and
collective interests and aspirations through peaceful and lawful means.

People's organizations are bona fide associations of citizens with demonstrated capacity to
promote the public interest and with identifiable leadership, membership, and structure.

Sec. 16. The right of the people and their organizations to effective and reasonable
participation at all levels of social, political, and economic decision-making shall not be
abridged. The State shall, by laws, facilitate the establishment of adequate consultation
mechanisms.

Section 3 of its Article X also reiterated the mandate for Congress to enact a local government
code which "shall provide for a more responsive and accountable local government structure
instituted through a system of decentralization with effective mechanisms of recall, initiative
and
referendum. . .," viz :

Sec. 3. The Congress shall enact a local government code which shall provide for a
more responsible and accountable local government structure instituted through a system of
decentralization with effective mechanisms of recall, initiative, and referendum, allocate among
the different local government units their powers, responsibilities, and resources, and provide
for the qualifications, election, appointment and removal, term, salaries, powers and functions
and duties of local officials, and all other matters relating to the organization and operation of
the local units.

In response to this constitutional call, Congress enacted R.A. 7160, otherwise known as the
Local Government Code of 1991, which took effect on January 1, 1992. In this Code,
Congress provided for a second mode of initiating the recall process through a preparatory
recall assembly which in the provincial level is composed of all mayors, vice-mayors and
sanggunian members of the municipalities and component cities. We quote the pertinent
provisions of R.A. 7160, viz:

CHAPTER 5 — RECALL

Sec. 69. By Whom Exercised. — The power of recall for loss of confidence shall be
exercised by the registered voters of a local government unit to which the local elective official
subject to such recall belongs.

Sec. 70. Initiation of the Recall Process. (a) Recall may be initiated by a preparatory recall
assembly or by the registered voters of the local government unit to which the local elective
official subject to such recall belongs.

(b) There shall be a preparatory recall assembly in every province, city, district, and
municipality which shall be composed of the following:

(1) Provincial Level. — all mayors, vice-mayors and sanggunian members of the
municipalities and component cities;

(2) City level. — All punong barangay and sangguniang barangay members in the city;

(3) Legislative District level. — In cases where sangguniang panlalawigan members are
elected by district, all elective municipal officials in the district; in cases where sangguniang
panglungsod members are elected by district , all elective barangay officials in the district; and

(4) Municipal level. — All punong barangay and sangguniang barangay members in the
municipality.

(c) A majority of all the preparatory recall assembly members may convene in session in a
public place and initiate a recall proceeding against any elective official in the local government
unit concerned. Recall of provincial, city, or municipal officials shall be validly initiated through
a resolution adopted by a majority of all the members of the preparatory recall assembly
concerned during its session called for the purpose.

(d) Recall of any elective provincial, city, municipal, or barangay official may be validly
initiated upon petition of at least twenty-five (25) percent of the total number of registered
voters in the local government unit concerned during the election which in the local official
sought to be recalled was elected.

Sec. 71. Election Recall — Upon the filing of a valid resolution petition for with the
appropriate local office of the Comelec, the Commission or its duly authorized representative
shall set the date of the election on recall, which shall not be later than thirty (30) days after the
filing of the resolution or petition recall in the case of the barangay, city, or municipal officials,
forty-five (45) days in the case of provincial officials. The official or officials sought to be
recalled shall automatically be considered as duly registered candidate or candidates to the
pertinent positions and, like other candidates, shall be entitled to be voted upon.

Sec. 72. Effectivity of Recall. — The recall of an elective local official shall be effective
only upon the election and proclamation of a successor in the person of the candidate
receiving the highest number of votes cast during the election on recall. Should the official
sought to be recalled receive the highest number of votes, confidence in him is thereby
affirmed, and he shall continue in office.

Sec. 73. Prohibition from Resignation. — The elective local official sought to be recalled
shall not be allowed to resign while the recall process is in progress.

Sec. 74. Limitations on Recall. — (a) Any elective local official may be the subject of a
recall election only once during his term of office for loss of confidence.

(b) No recall shall take place within one (1) year from the date of the official's assumption to
office or one (1) year immediately preceding regular election.

A reading of the legislative history of these recall provisions will reveal that the idea of
empowering a preparatory recall assembly to initiate the recall from office of local elective
officials originated from the House of Representatives A reading of the legislative history of
these recall provisions will reveal that the idea of empowering a preparatory recall assembly to
initiate the recall from office of local elective officials, originated from the House of
Representatives and not the Senate. 15 The legislative records reveal there were two (2)
principal reasons why this alternative mode of initiating the recall process thru an assembly
was adopted, viz: (a) to diminish the difficulty of initiating recall thru the direct action of the
people; and (b) to cut down on its expenses. 16 Our lawmakers took note of the undesirable
fact that the mechanism initiating recall by direct action of the electorate was utilized only once
in the City of Angeles, Pampanga, but even this lone attempt to recall the city mayor failed.
Former Congressman Wilfredo Cainglet explained that this initiatory process by direct action of
the people was too cumbersome, too expensive and almost impossible to implement. 17
Consequently, our legislators added in the a second mode of initiating the recall of local
officials thru a preparatory recall assembly. They brushed aside the argument that this second
mode may cause instability in the local government units due to its imagined ease.

We have belabored the genesis of our recall law for it can light up many of the unillumined
interstices of the law. In resolving constitutional disputes, We should not be beguiled by foreign
jurisprudence some of which are hardly applicable because they have been dictated by
different constitutional settings and needs. Prescinding from this proposition, We shall now
resolve the contention of petitioners that the alternative mode of allowing a preparatory recall
assembly to initiate the process of recall is unconstitutional.

It is first postulated by the petitioners that "the right to recall does not extend merely to the
prerogative of the electorate to reconfirm or withdraw their confidence on the official sought to
be recalled at a special election. Such prerogative necessarily includes the sole and exclusive
right to decide on whether to initiate a recall proceedings or not." 18

We do not agree. Petitioners cannot point to any specific provision of the Constitution that will
sustain this submission. To be sure, there is nothing in the Constitution that will remotely
suggest that the people have the "sole and exclusive right to decide on whether to initiate a
recall proceeding." The Constitution did not provide for any mode, let alone a single mode, of
initiating recall elections. 19 Neither did it prohibit the adoption of multiple modes of initiating
recall elections. The mandate given by section 3 of Article X of the Constitution is for Congress
to "enact a local government code which shall provide for a more responsive and accountable
local government structure through a system of decentralization with effective mechanisms of
recall, initiative, and referendum . . ." By this constitutional mandate, Congress was clearly
given the power to choose the effective mechanisms of recall as its discernment dictates. The
power given was to select which among the means and methods of initiating recall elections
are effective to carry out the judgment of the electorate. Congress was not straightjacketed to
one particular mechanism of initiating recall elections. What the Constitution simply required is
that the mechanisms of recall, whether one or many, to be chosen by Congress should be
effective. Using its constitutionally granted discretion, Congress deemed it wise to enact an
alternative mode of initiating recall elections to supplement the former mode of initiation by
direct action of the people. Congress has made its choice as called for by the Constitution and
it is not the prerogative of this Court to supplant this judgment. The choice may be erroneous
but even then, the remedy against a bad law is to seek its amendment or repeal by the
legislative. By the principle of separation of powers, it is the legislative that determines the
necessity, adequacy, wisdom and expediency of any law. 20

Petitioners also positive thesis that in passing Resolution 1, the Bataan Preparatory Recall
Assembly did not only initiate the process of recall but had de facto recalled petitioner Garcia
from office, a power reserved to the people alone. To quote the exact language of the
petitioners: "The initiation of a recall through the PRA effectively shortens and ends the term of
the incumbent local officials. Precisely, in the case of Gov. Garcia, an election was scheduled
by the COMELEC on 11 October 1993 to determine who has the right to assume the
unexpired portion of his term of office which should have been until June 1995. Having been
relegated to the status of a mere candidate for the same position of governor (by operation of
law) he has, therefore, been effectively recalled." 21 In their Extremely Urgent Clarificatory
Manifestation, 22 petitioners put the proposition more bluntly stating that a "PRA resolution of
recall is the re call itself."

Again, the contention cannot command our concurrence. Petitioners have misconstrued the
nature of the initiatory process of recall by the PRAC. They have embraced the view that
initiation by the PRAC is not initiation by the people. This is a misimpression for initiation by the
PRAC is also initiation by the people, albeit done indirectly through their representatives. It is
not constitutionally impermissible for the people to act through their elected representatives.
Nothing less than the paramount task of drafting our Constitution is delegated by the people to
their representatives, elected either to act as a constitutional convention or as a congressional
constituent assembly. The initiation of a recall process is a lesser act and there is no rhyme or
reason why it cannot be entrusted to and exercised by the elected representatives of the
people. More far out is petitioners' stance that a PRA resolution of recall is the recall itself. It
cannot be seriously doubted that a PRA resolution of recall merely, starts the process. It is part
of the process but is not the whole process. This ought to be self evident for a PRA resolution
of recall that is not submitted to the COMELEC for validation will not recall its subject official.
Likewise, a PRA resolution of recall that is rejected by the people in the election called for the
purpose bears no effect whatsoever. The initiatory resolution merely sets the stage for the
official concerned to appear before the tribunal of the people so he can justify why he should
be allowed to continue in office. Before the people render their sovereign judgment, the official
concerned remains in office but his right to continue in office is subject to question. This is
clear in section 72 of the Local Government Code which states that "the recall of an elective
local official shall be effective only upon the election and proclamation of a successor in the
person of the candidate receiving the highest number of votes cast during the election on
recall."

We shall next settle the contention of petitioners that the disputed law infracts the equal
protection clause of the Constitution. Petitioners asseverate:

5.01.2. It denied petitioners the equal protection of the laws for the local officials
constituting the majority party can constitute itself into a PRA and initiate the recall of a duly
elected provincial official belonging to the minority party thus rendering ineffectual his election
by popular mandate. Relevantly, the assembly could, to the prejudice of the minority (or even
partyless) incumbent official, effectively declare a local elective position vacant (and demand
the holding of a special election) for purely partisan political ends regardless of the mandate of
the electorate. In the case at bar, 64 of the 74 signatories to the recall resolution have been
political opponents of petitioner Garcia, not only did they not vote for him but they even
campaigned against him in the 1992 elections.

Petitioners' argument does not really assail the law but its possible abuse by the members of
the PRAC while exercising their right to initiate recall proceedings. More specifically, the fear is
expressed that the members of the PRAC may inject political color in their decision as they
may initiate recall proceedings only against their political opponents especially those belonging
to the minority. A careful reading of the law, however, will ineluctably show that it does not give
an asymmetrical treatment to locally elected officials belonging to the political minority. First to
be considered is the politically neutral composition of the preparatory recall assembly. Sec. 70
(b) of the Code provides:

Sec. 70. Initiation of the Recall Process. (a) Recall may be initiated by a preparatory recall
assembly or by the registered voters of the local government unit to which the local elective
official subject to such recall belongs.

(b) There shall be a preparatory recall assembly in every province, city, district, and
municipality which shall be composed of the following:

(1) Provincial level. — All mayors, vice-mayors and sanggunian members of the
municipalities and component cities;

(2) City level. — All punong barangay and sangguniang barangay members in the city;

(3) Legislative District Level. — In cases where sangguniang panlalawigan members are
elected by district, all elective municipal officials in the district; and in cases where
sangguniang panglungsod members are elected by district, all elective barangay officials in the
district; and

(4) Municipal level. — All punong barangay and sangguniang barangay members in the
municipality.
Under the law, all mayors, vice-mayors and sangguniang members of the municipalities and
component cities are made members of the preparatory recall assembly at the provincial level.
Its membership is not apportioned to political parties. No significance is given to the political
affiliation of its members. Secondly, the preparatory recall assembly, at the provincial level
includes all the elected officials in the province concerned. Considering their number, the
greater probability is that no one political party can control its majority. Thirdly, sec. 69 of the
Code provides that the only ground to recall a locally elected public official is loss of
confidence of the people. The members of the PRAC are in the PRAC not in representation of
their political parties but as representatives of the people. By necessary implication, loss of
confidence cannot be premised on mere differences in political party affiliation. Indeed, our
Constitution encourages multi-party system for the existence of opposition parties is
indispensable to the growth and nurture of democratic system. Clearly then, the law as crafted
cannot be faulted for discriminating against local officials belonging to the minority.

The fear that a preparatory recall assembly may be dominated by a political party and that it
may use its power to initiate the recall of officials of opposite political persuasions, especially
those belonging to the minority, is not a ground to strike down the law as unconstitutional. To
be sure, this argument has long been in disuse for there can be no escape from the reality that
all powers are susceptible of abuse. The mere possibility of abuse cannot, however, infirm per
se the grant of power to an individual or entity. To deny power simply because it can be
abused by the grantee is to render government powerless and no people need an impotent
government. There is no democratic government that can operate on the basis of fear and
distrust of its officials, especially those elected by the people themselves. On the contrary, all
our laws assume that officials, whether appointed or elected, will act in good faith and will
perform the duties of their office. Such presumption follows the solemn oath that they took after
assumption of office, to faithfully execute all our laws.

Moreover, the law instituted safeguards to assure that the initiation of the recall process by a
preparatory recall assembly will not be corrupted by extraneous influences. As explained
above, the diverse and distinct composition of the membership of a preparatory recall
assembly guarantees that all the sectors of the electorate province shall be heard. It is for this
reason that in Our Resolution of September 21, 1993, We held that notice to all the members
of the recall assembly is a condition sine qua non to the validity of its proceedings. The law
also requires a qualified majority of all the preparatory recall assembly members to convene in
session and in a public place. It also requires that the recall resolution by the said majority
must be adopted during its session called for the purpose. The underscored words carry
distinct legal meanings and purvey some of the parameters limiting the power of the members
of a preparatory recall assembly to initiate recall proceedings. Needless to state, compliance
with these requirements is necessary, otherwise, there will be no valid resolution of recall
which can be given due course by the COMELEC.

Furthermore, it cannot be asserted with certitude that the members of the Bataan preparatory
recall assembly voted strictly along narrow political lines. Neither the respondent COMELEC
nor this Court made a judicial inquiry as to the reasons that led the members of the said recall
assembly to cast a vote of lack of confidence against petitioner Garcia. That inquiry was not
undertaken for to do so would require crossing the forbidden borders of the political thicket.
Former Senator Aquilino Pimentel, Jr., a major author of the subject law in his book The Local
Government Code of 1991: The Key to National Development, stressed the same reason why
the substantive content of a vote of lack of confidence is beyond any inquiry, thus:

There is only one ground for the recall of local government officials: loss of confidence. This
means that the people may petition or the Preparatory Recall Assembly may resolve to recall
any local elective officials without specifying any particular ground except loss of confidence.
There is no need for them to bring up any charge of abuse or corruption against the local
elective officials who are the subject of any recall petition.
In the case of Evardone vs. Commission on Elections, et al., 204 SCRA 464, 472 (1991), the
Court ruled that "loss of confidence" as a ground for recall is a political question. In the words
of the Court, "whether or not the electorate of the municipality of Sulat has lost confidence in
the incumbent mayor is a political question.

Any assertion therefore that the members of the Bataan preparatory recall assembly voted due
to their political aversion to petitioner Garcia is at best a surmise.

Petitioners also contend that the resolution of the members of the preparatory recall assembly
subverted the will of the electorate of the province of Bataan who elected petitioner Garcia with
a majority of 12,500 votes. Again, the contention proceeds from the erroneous premise that the
resolution of recall is the recall itself. It refuses to recognize the reality that the resolution of
recall is a mere proposal to the electorate of Bataan to subject petitioner to a new test of faith.
The proposal will still be passed upon by the sovereign electorate of Bataan. As this judgment
has yet to be expressed, it is premature to conclude that the sovereign will of the electorate of
Bataan has been subverted. The electorate of Bataan may or may not recall petitioner Garcia
in an appropriate election. If the electorate re-elects petitioner Garcia, then the proposal to
recall him made by the preparatory recall assembly is rejected. On the other hand, if the
electorate does not re-elect petitioner Garcia, then he has lost the confidence of the people
which he once enjoyed. The judgment will write finis to the political controversy. For more than
judgments of courts of law, the judgment of the tribunal of the people is final for "sovereignty
resides in the people and all government authority emanates from them."

In sum, the petition at bench appears to champion the sovereignty of the people, particularly
their direct right to initiate and remove elective local officials thru recall elections. If the petition
would succeed, the result will be a return to the previous system of recall elections which
Congress found should be improved. The alternative mode of initiating recall proceedings thru
a preparatory recall assembly is, however, an innovative attempt by Congress to remove
impediments to the effective exercise by the people of their sovereign power to check the
performance of their elected officials. The power to determine this mode was specifically given
to Congress and is not proscribed by the Constitution.

IN VIEW WHEREOF, the original Petition and the Supplemental Petition assailing the
constitutionality of section 70 of R.A. 7160 insofar as it allows a preparatory recall assembly to
initiate the recall process are dismissed for lack of merit. This decision is immediately
executory.

SO ORDERED.