CITY OF MANILA, HON. ALFREDO S. LIM AS THE MAYOR OF THE CITY OF MANILA, HON. JOSELITO L. ATIENZA, IN HIS CAPACITY AS VICE-MAYOR OF THE CITY OF MANILA AND PRESIDING OFFICER OF TH…

City of Manila versus Malate Tourist Development Corporation

The Case

This is a petition for review on a pure question of law brought by the City of Manila, its Mayor, its Vice-Mayor and the members of its City Council against Malate Tourist Development Corporation, the operator of a motel in Malate known as Victoria Court. The City assails the decision of the Regional Trial Court of Manila, Branch 18, which declared Ordinance Number 7783 of the City of Manila null and void and made permanent the injunction against its enforcement. The Ordinance prohibited the establishment and operation of motels, inns and other enumerated amusement establishments within the Ermita-Malate area. The case matters because it is the Court's clearest statement that the police power of a local government unit, however broad, remains a delegated power subordinate to the Constitution and to the general laws, and that the promotion of public morals cannot be pursued by means that are unreasonable and unduly oppressive.

Procedural History

Malate Tourist Development Corporation filed a petition for declaratory relief with a prayer for a writ of preliminary injunction and a temporary restraining order before the Regional Trial Court of Manila, Branch 18, impleading the City of Manila, Mayor Alfredo Lim, Vice-Mayor Joselito Atienza and the members of the City Council. The trial court, through Judge Perfecto Laguio, Jr., issued an ex parte temporary restraining order against enforcement of the Ordinance, and later granted the writ of preliminary injunction. After trial, the trial court rendered its decision declaring the Ordinance null and void and making the injunction permanent. The City filed a notice of appeal, manifesting that it was elevating the case to the Supreme Court on pure questions of law under the rule then governing appeals on questions of law, and thereafter filed the present petition. The Supreme Court decided the case in April 2005.

Facts

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

On the ninth of March 1993, the City Council of Manila enacted Ordinance Number 7783, which the City Mayor approved on the thirtieth of March 1993. The Ordinance prohibited, within the Ermita-Malate area bounded by Teodoro M. Kalaw Sr. Street in the North, Taft Avenue in the East, Vito Cruz Street in the South and Roxas Boulevard in the West, any business providing certain forms of amusement, entertainment, services and facilities where women are used as tools in entertainment and which tend to disturb the community, annoy the inhabitants and adversely affect the social and moral welfare of the community. Among the establishments expressly enumerated were sauna parlors, massage parlors, karaoke bars, beerhouses, night clubs, day clubs, super clubs, discotheques, cabarets, dance halls, motels and inns. The Mayor, the City Treasurer or any person acting in their behalf were barred from issuing permits or licenses for these businesses. Owners and operators were given three months to wind up, transfer outside the area, or convert to other allowable businesses. Violation was punishable by imprisonment of one year or a fine of five thousand pesos, or both, and a subsequent conviction carried permanent closure and padlocking of the premises.

On the twenty-eighth of June 1993, Malate Tourist Development Corporation filed its petition for declaratory relief, arguing that motels and inns were not establishments for amusement or entertainment, that they did not use women as tools of entertainment, and that the Ordinance was invalid and unconstitutional. It contended that the City Council had only the power to regulate, not to prohibit, motels; that the Ordinance violated Presidential Decree Number 499; that it was not a proper exercise of police power; that it was an ex post facto law; that it was confiscatory and invaded property rights; and that it denied equal protection. The City, for its part, invoked the general welfare clause of the Local Government Code and the Revised Charter of Manila, and insisted that the Ordinance enjoyed the presumption of validity.

Issues

• Whether or not Ordinance Number 7783 of the City of Manila is a valid exercise of the delegated police power of the City Council.
• Whether or not the Ordinance contravenes the Constitution, particularly the due process and equal protection clauses, and the general laws, particularly Presidential Decree Number 499.
• Whether or not the trial court erred in declaring the Ordinance ultra vires and null and void.

Applicable Provisions

Section 16 of the Local Government Code, the general welfare clause, 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 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.

This is the source of the delegated police power invoked by the City, and the Court measures the Ordinance against it.

Section 458 of the Local Government Code, paragraph (a), subparagraph (4), clause (vii), provides:

Regulate the establishment, operation, and maintenance of any entertainment or amusement facilities, including theatrical performances, circuses, billiard pools, public dancing schools, public dance halls, sauna baths, massage parlors, and other places for entertainment or amusement; regulate such other events or activities for amusement or entertainment, particularly those which tend to disturb the community or annoy the inhabitants, or require the suspension or suppression of the same; or, prohibit certain forms of amusement or entertainment in order to protect the social and moral welfare of the community.

The City relied on the final clause as authority to prohibit, and the Court had to determine the reach of that delegated power.

Section 18, paragraph (kk) of the Revised Charter of the City of Manila provides:

To enact all ordinances it may deem necessary and proper for the sanitation and safety, the furtherance of the prosperity, and the promotion of the morality, peace, good order, comfort, convenience, and general welfare of the city and its inhabitants, and such others as may be necessary to carry into effect and discharge the powers and duties conferred by this chapter; and to fix penalties for the violation of ordinances which shall not exceed two hundred pesos fine or six months' imprisonment, or both such fine and imprisonment, for a single offense.

This was the second source of authority claimed by the City, and its penalty ceiling bears on the validity of the sanctions imposed.

Article III, Section 1 of the Constitution provides:

No person shall be deprived of life, liberty or property without due process of law, nor shall any person be denied the equal protection of laws.

This is the constitutional standard against which the Ordinance's prohibitions and penalties were struck down.

Ruling

On the first issue, the Court held that the Ordinance was an invalid exercise of delegated police power. The Court laid down the tests of a valid ordinance: it must be within the corporate powers of the local government unit, passed according to prescribed procedure, and must not contravene the Constitution or any statute, must not be unfair or oppressive, must not be partial or discriminatory, must not prohibit but may regulate trade, must be general and consistent with public policy, and must not be unreasonable. The Court stressed that local government units legislate only by virtue of a derivative legislative power delegated by Congress, and that the delegate cannot be superior to the principal. The Court also held that to invoke police power validly, the interests of the public generally must require the interference with private rights, and the means adopted must be reasonably necessary and not unduly oppressive, with no less intrusive alternative available. Even granting that the Ordinance's objectives fell within the City's police power, the Court found the means unreasonable and unduly oppressive: the worthy aim of fostering public morals could be achieved through reasonable restrictions rather than absolute prohibition, and the closure, transfer or conversion of businesses had no reasonable relation to the accomplishment of the Ordinance's purposes.

On the second issue, the Court held that the Ordinance was repugnant to the Constitution and to the general laws. It found the enactment so replete with constitutional infirmities that almost every sentence violated a constitutional provision, and that its prohibitions and sanctions transgressed the cardinal rights of persons. The Court emphasized that the police power of the City Council, however broad, is subordinate to constitutional limitations and must be exercised with utmost observance of the rights of the people to due process and equal protection, and cannot be exercised whimsically, arbitrarily or despotically.

On the third issue, the Court held that the trial court did not err in declaring the Ordinance ultra vires and therefore null and void.

Doctrine

First, a local government unit possesses only delegated legislative power; it cannot enact an ordinance that contravenes the Constitution or a general statute, for the delegate cannot be superior to the principal. Second, for an ordinance to be valid it must not only be within the corporate powers of the local government unit and passed according to prescribed procedure, but must also not contravene the Constitution or any statute, must not be unfair or oppressive, must not be partial or discriminatory, must not prohibit but may regulate trade, must be general and consistent with public policy, and must not be unreasonable. Third, a valid exercise of police power requires both that the public interest require the interference with private rights and that the means adopted be reasonably necessary and not unduly oppressive, with no less intrusive alternative available; failing either requisite, the measure is an arbitrary intrusion into private rights and violates the due process clause. Fourth, the promotion of public morals is a legitimate governmental objective, but it must be pursued by reasonable regulation rather than absolute prohibition where a less restrictive means suffices.

Disposition

The petition was denied and the decision of the trial court was affirmed; the City of Manila lost, and Ordinance Number 7783 was declared null and void with the injunction against its enforcement made permanent.

Remember This

The single line to memorize is that the police power of a local government unit is a delegated power subordinate to the Constitution and the general laws, and its exercise must be reasonable and not unduly oppressive. Examiners use this case to test the tests of a valid ordinance, the requisites of a valid exercise of police power, and the rule that public morals may be promoted by regulation but not by unreasonable absolute prohibition.