RICARDO CRUZ, PETITIONER, VS. HON. COURT OF APPEALS, LOPE S. OCAMPO, FEDERICO TUAZON, LEON SANTOS, ANGELINA LABRADOR, CIRIACA STO. TOMAS, VICTORIA ANONOY, CIPRIANA GONGON, CARLO…

Cruz versus Court of Appeals

The Case

This is a petition for review on certiorari brought by Ricardo Cruz against the Court of Appeals and the private respondent vendors of the Padre Rada Market in Tondo, Manila. The vendors had sued to annul the decision of the Manila City Mayor allowing the market operators to withdraw the Padre Rada Market from its status as a public market. The case matters because it fixes who may close or convert a public market: not the mayor acting alone, but the same authority that authorized the market to operate, and only after the safeguards the law lays down for the vendors.

Procedural History

The private respondents instituted a class suit before the then Court of First Instance of Manila, Branch Eight, in behalf of the vendors and regular stall holders of the Padre Rada Market, for annulment with preliminary injunction against the then Manila Mayor Antonio Villegas, petitioner Cruz, and other persons whose names were unknown to them. The complaint prayed that the City Mayor's decision to withdraw the Padre Rada Market as a public market be declared null and void. The trial court rendered judgment declaring valid the Mayor's decision and the operator's notice of withdrawal, vacating the writ of preliminary injunction, and dismissing the complaint; it also awarded damages and attorney's fees on the counterclaim, later reducing the daily award of actual damages in an amended decision. On appeal, the Court of Appeals reversed and set aside the lower court's decision and denied the withdrawal of government control and supervision until legal conditions and equitable justification for the withdrawal by private parties should obtain. A motion for reconsideration was denied, and the matter came to the Supreme Court on a petition for review on certiorari.

Facts

Petitioner Ricardo Cruz and his business associates had owned and operated the Padre Rada Market for more than twenty-five years. The market was authorized to be operated as a public market of the City of Manila by virtue of Resolution Number 230, as amended by Resolution Number 406, both series of 1949, adopted by the Municipal Board of Manila with the approval of the then Mayor.

On May 26, 1970, the management, represented by Cruz, wrote Mayor Villegas that it was withdrawing three-fourths of the area of the market from the direct supervision and control of the City Treasurer's Office effective June 15, 1970, and that from that date the withdrawn portion would cease to function and operate as a public market. The respondent vendors were notified and protested. After several exchanges of referrals, indorsements, and communications, Mayor Villegas allowed the withdrawal, relying on a Court of Appeals decision upholding the right of the operators of the Elcano Market to withdraw their property from use as a public market. Motions for reconsideration were denied, and the vendors instituted the class suit.

The records show that the petitioner wanted to convert the major portion of the market into a private market to enable him to raise the rentals for the stalls, and that at least 840 market stalls were involved. The City Treasurer and the Market Administrator objected, the latter because of the displacement of numerous vendors, the former because of the diminution of city revenues.

Issues

• Whether or not the City Mayor may validly allow the withdrawal of the Padre Rada Market, or a major portion of it, from its use as a public market without the joint action of the Municipal Board.
• Whether or not the withdrawal violates Republic Act Number 6039, which protects vendors of city-owned and operated public markets.
• Whether or not the dissolution of the Municipal Board of Manila left the City Mayor with the power to authorize the withdrawal.
• Whether or not the Court of Appeals could compel the petitioner to continue operating the market as a public market despite his claimed losses.

Applicable Provisions

Section 18, paragraph cc, of Republic Act Number 409, the Revised Charter of the City of Manila, provides:

Legislative powers. - The Municipal Board shall have the following legislative powers: (cc) Subject to the provisions of ordinances issued by the Department of Health in accordance with law, to provide for the establishment and maintenance and fix the fees for the use of, and regulate public stables, laundries, and baths, and public markets and slaughterhouses, and prohibit or permit the establishment or operation within the city limits of public markets and slaughterhouses by any person, entity, association, or corporation other than the city.

This is the source of the power that created the market, and the Court holds that the same power must concur in its withdrawal.

Section 1, III, paragraph 2, of Republic Act Number 6039, amending the Revised Charter of the City of Manila, provides:

City-owned and operated public markets shall not be disposed of, closed, destroyed, sold or transferred until all vendors therein shall have been relocated or transferred by the city government at its expense to another temporary or new public market: Provided, however, That notice of the city's such intention or plans shall be made to all concerned vendors at least one hundred twenty days before the actual transfer or relocation to another market site: Provided, further, That all such temporarily relocated vendors shall be given preference and priority to occupy stalls in the new site as provided for under paragraph II (5) and III (1).

The Court of Appeals held that the withdrawal violated this provision, reading the conjunction "and" as additional rather than restrictive.

Section 4, paragraph 5, of Presidential Decree Number 824, creating the Metropolitan Manila Commission, provides:

The Commission shall have the following powers and functions: 5) To review, amend, revise or repeal all ordinances, resolutions and acts of cities and municipalities within Metropolitan Manila.

This shows where the legislative functions of the dissolved Municipal Board of Manila passed.

Ruling

On the first issue, the Court answered in the negative. The establishment and maintenance of public markets is by law among the legislative powers of the City of Manila. Since the operation of the Padre Rada Market was authorized by a municipal board resolution and approved by the City Mayor, as provided by law, it follows that a withdrawal of the whole or any portion from use as a public market must be subject to the same joint action of the Board and the Mayor. The Mayor of Manila, by himself, cannot provide for the opening, operations, and closure of a public market. By the very nature of a market, its location, opening, operations, and closure must be regulated by government; the question is not the petitioner's right to run his market as he pleases but what agency or office should supervise its operations.

On the second issue, the Court agreed that the Padre Rada Market is a public market, defined as one dedicated to the service of the general public and operated under government control and supervision as a public utility, whether owned by the government or by a private individual. A public market may be the object of individual ownership or lease, subject to municipal supervision and control; if a market has been permitted to operate under government license for service to the general public, it is a public market whether the building or the land is of private or public ownership. The Padre Rada Market is therefore a public market which happens to be privately owned and privately operated, and its conversion into a private market or its closure must follow the procedures laid down by law.

On the third issue, the dissolution of the Municipal Board did not make the City Mayor both executive and legislature; he was never vested with legislative power. The Metropolitan Manila Commission took over the legislative functions of the Municipal Board of Manila. It was not within the mayor's authority to allow the questioned withdrawal.

On the fourth issue, the Court sustained the Court of Appeals. The intention of the operators was clear from the notice to the vendors: the withdrawal from public status was meant to operate the market without government control and supervision, not to discontinue operating as a market. The Padre Rada Market remains a public market and as such should be subject to the local government's supervision and control.

Doctrine

A public market is one dedicated to the service of the general public and operated under government control and supervision as a public utility, whether owned by the government or by a private individual; private ownership of the land or building does not remove its public character. The power to authorize the operation of a public market carries with it the power to withdraw that authorization, and where the law vests that power in the municipal board subject to the mayor's approval, the withdrawal of the whole or any portion of the market requires the same joint action; the mayor cannot do it alone. The dissolution of the municipal board does not transfer legislative power to the mayor, for that power passed to the Metropolitan Manila Commission under Presidential Decree Number 824.

Disposition

The petition was dismissed for lack of merit and the decision of the Court of Appeals was affirmed; the private respondent vendors prevailed, and the withdrawal of the Padre Rada Market from its status as a public market was not allowed.

Remember This

Memorize the line that only the power that created a public market can withdraw it, and that the mayor acting alone cannot close or convert one. Examiners use this case on the nature of a public market, on the legislative powers of local governments over markets, and on the effect of the abolition of the municipal board.