JUAN P. GERENA, ET AL., PLAINTIFFS AND APPELLANTS, VS. CITY OF MANILA, ET AL., DEFENDANTS AND APPELLEES.

This is an appeal from a decision of the Court of First Instance of
Manila, Branch V, upholding the validity of Ordinance No. 3628 of the
City of Manila. The appeal was taken to the Court of Appeals, but that
court, has certified the case to us on the ground that only questions
of law are involved.

The pertinent facts of the case are not disputed, and are stated in the decision of the trial court as follows:

*          *          *          *          *          *          *

“Plaintiffs
have been paying for each of their juke boxes the annual license fee of
P50.00 under the aforesaid Ordinance No. 3374 (Exhs. B, B-1 to B-9),
besides permit fee of P50.00 when a machine was installed and the same
amount of permit fee every time a machine was transferred to another
place (Exhs. A, A-1 to A-9). Pinball machine operators paid the same
amounts of license and permit fees under the same Ordinance.

“In
February, 1954, the City Mayor recommended to the Municipal Board the
further amendment, of Sections 773 and 774 of the Revised Ordinances of
1927, as amended (by Ordinance No. 3374) so as to include within the
scope of its regulations the so-called pinball machines which,
according to him, “have conduced to promote idleness among an
increasing number of city residents” (Exhs. E and G). On March 19,
1954, the Municipal Board enacted the Ordinance in question (No. 3628)
imposing an annual license fee of P300 for every license granted for
the installation and use of the public for compensation any mechanical
contrivance or automatic apparatus which functions through the
introduction of money not otherwise prohibited by the law of Weights
and Measures and not a gambling device, for purposes of amusement or of
confronting the weights of persons or things, or of printing letters or
numbers, or displaying pictures inside the apparatus, or reproducing
recorded music, * * *

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“On
April 11, 1957, plaintiff Gerena wrote to defendant City Treasurer
requesting that the enforcement of Ordinance No. 3628 which affects
juke boxes be held in abeyance pending consideration of his petition
with the Municipal Board for the amendment of said Ordinance. The
request was denied ‘as this Office (City Treasurer’s) has no power to
suspend the enforcement of any city ordinance’, at the same time
suggesting that ‘all the members of ‘APOP’ be advised to settle their
outstanding obligations arising from the provisions of the aforesaid
ordinance so as to avoid penalty and unnecessary inconvenience;
otherwise, this office will be constrained to take drastic action on
the premises (Exh. C)’.

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“Plaintiffs,
who are (said to be) engaged in the business of operating automatic
phonograph machines, popularly known as ‘juke boxes’, and who claim to
have been duly authorized by ether juke box operators and owners,
instituted this action on August 12, 1957, to have Ordinance No. 3628
of defendant City declared null and void and ineffective as to
automatic phonograph operators’ business, praying that, in the
meantime, a writ of preliminary injunction be issued commanding
defendants to desist from enforcing the provisions of said Ordinance
and compelling the defendants Mayor and City Treasurer to issue renewal
permits and licenses to plaintiffs and to accept and give due course to
plaintiffs’ applications for the installation of new units and! for the
transfer of others to better locations upon compliance with the
Ordinance in force before the enactment of said Ordinance No. 3628,
alleging pertinently, in their complaint, that (1) the amount of annual
fee of P300.00 is exorbitant, excessive and substantially
disproportionate to, the reasonable expenses of licensing and
regulating the plaintiffs’ legitimate, harmless and useful business * *
* and, therefore, beyond the power of the licensing authority of
defendant City of Manila to exact in the exercise of its police power;
* * *

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“Defendants
filed a motion to dismiss on the alleged ground of lack of cause of
action, the constitutionality or validity of the Ordinance in question
(No. 3628) having already been upheld by our Supreme Court in the case
of “Recreation and Amusement Association of the Philippines, Inc. vs.
The City of Manila, et al.” 100 Phil. 950, Off. Gaz. [9] 2767. After
hearing, the resolution of said motion to dismiss was ordered deferred
until after the trial.

“Defendants then filed answer
alleging that Ordinance No. 3628 has already been held valid by the
Supreme Court, and since the complaint is primarily premised on the
alleged invalidity of said Ordinance, it states no cause of action; * *
* and that the Municipal Board has the power to impose the amount of
P300.00 as license fee for every machine specified in Ordinance No.
3628, pursuant to Ordinance No. 3628, * * *”

After trial, the lower court, on February 4, 1958, rendered judgment
upholding the validity of Ordinance No. 3628. Hence, this appeal.

This case is similar to the case of Morcoin Co., Ltd., and Suter, Inc. vs. City of Manila, et al. (supra,
p. 920), where the validity of the same Ordinance No. 3628 was
contested. Declaring the evidence null and void, the license fee
charged being excessive and unreasonable, we made the following
observations:

“* * * the amount of P300
imposed by Ordinance No. 3628 as license fee for the installation and
use of juke box machines is unreasonable and far exceeds the expenses
of issuing the license and of regulating their operation. It will be
observed that the ordinance in question does not even provide for
inspection and supervision of each machine installed. And the
Committees on Laws and Finance of the Municipal Board of the City of
Manila themselves—which conducted a public hearing in connection with
the petition filed during the pendency of this case by some juke box
operators—found that juke box operators would not make any profit by
paying the license fee of P300, and that the said amount of P300 is
“prohibitory and suppressive.” This finding is supported by the record,
for it was shown that two of plaintiffs’ juke box machines, after
deducting depreciation and operating expenses, but before the payment
of permit and license fees, had an annual income of only about P211. In
view of these circumstances, it is obvious that the amount of P300
charged as license fee is excessive and cannot be justified. In this
connection, it should be stated that although the presumption is always
in favor of the validity or reasonableness of the ordinance, such
presumption must nevertheless be set aside when the invalidity or
unreasonableness appears on the face of the ordinance itself or is
established by the proper evidence.”

Conformably to the above pronouncements, the decision appealed from is reversed. So ordered with costs.

Bengzon, Bautista Angelo, Labrador, Concepcion, Reyes, J. B. L., and Paredes, JJ., concur.