I. BECK, INCORPORATED, PLAINTIFF AND APPELLANT, VS. VICTOR ALFONSO, AS CITY TREASURER OF MANILA, DEFENDANT AND APPELLEE.

The novel question presented by this action relates to the right of the
City of Manila, to compel I. Beck, Incorporated to obtain a license as
an advertising agent for its radio broadcasting station KZIB. The
decision in the trial court sustained the pretensions of the City and
accordingly dismissed the complaint of the operator of the broadcasting
station. No analogous authority has been cited, and our own researches
have disclosed none.

As above indicated, I. Beck,
Incorporated, operates in the City of Manila a radio broadcasting
station known as radio station KZIB. During specified hours the radio
station broadcasts programs for the entertainment of the public. The
operator of the station permits business concerns, upon proper payment,
at certain intervals of the broadcasting period, to make use of its
station to present programs under their patronage and to make
themselves known to the public by advertising their business. It is
stipulated “that I. Beck & Co. does not solicit advertisements, but
any person or entity requiring the services of the station to advertise
its business or for any other purpose, if acceptable to I. Beck, Inc.,
is permitted to make use of the station with or without compensation.”

The Manila Charter, section 2444 (l),
empowers the municipal board to regulate and fix the amount of the
license fees for advertising agencies. In conformity with this
authority, the municipal board has seen fit to provide that “no person
shall maintain, conduct, or engage in the business or calling of an
advertising agent, or in the business of bill posting or street
advertising, without first having obtained a license therefor” (Revised
Ordinances, sec. 603), the amount fixed for the fee being the sum of
P500 per annum (Revised Ordinances, sec. 604).

We feel safe
in concluding that the broadcasting station of the plaintiff, like most
radio broadcasters, is to a large extent engaged in the business of
commercial advertising for pay, and that the broadcasting station is
supported in part by advertising. Indeed, these facts are practically
admitted. On the other hand, it is equally true that the plaintiff does
not solicit advertising, which is an important matter to be remembered.

We agree to a considerable extent with the interpretation of the
applicable provisions of the city ordinances given by the city fiscal.
For instance, we think him right in his argument that a very slight
basis could be laid for any differentiation between the business of an
advertising agent and the business of bill posting or street
advertising. In other words, the language of the ordinances recognizes
two forms of advertising, namely, a general one included in the words
“advertising agent” and a special one included in the words “bill
posting or street advertising”. But we do not think this interpretation
at all decisive of the case. In our opinion the city fiscal as well as
the trial court have overlooked fundamental considerations.

Even a cursory reading of the sections of the Revised Ordinances having
to do with the subject “advertising. agencies” discloses that it is not
upon advertising as advertising that the license fee is imposed. Nor is
it the means or instrumentality which is licensed, as for example, a
magazine containing advertising. On the contrary, it is “the business
or calling of an advertising agent”, to use the exact language of the
ordinances, for which the license is required. Moreover, the Insular
Law, Act No. 3846, in providing for the regulation of radio stations
and radio communication in the Philippine Islands, requires of the
person or corporation operating a radio station within the Philippine
Islands that it secure a franchise therefor from the Philippine
Legislature and a license from the Secretary of Commerce and
Communications, without, however, giving the slightest indication that
a broadcasting station shall further be considered to be an advertising
agent.

A comparison is sought to be made by the plaintiff
between the methods followed by a radio broadcasting station and the
methods followed in the use of the telephone and the post office.
However, an argument along this line impresses us as rather
far-fetched. A more appropriate comparison would be between the
newspaper and the radio broadcasting station. The newspaper sells space
for advertising purposes; the broadcasting station sells time for
advertising purposes. In the case of the newspaper, to our knowledge,
it has never been contended that because it contains advertising for
which compensation is received, the newspaper publisher is thereby
engaged in the business of an advertising agent. We may take cognizance
of what is familiar to every one, which is that in the business of an
advertising agent, he occupies himself in securing advertising, in
preparing the copy, and in causing the copy to be disseminated to the
public through various media. The advertising agent may utilize the
columns of a newspaper or he may utilize the time of a broadcasting
station. The person thus engaged in business is an advertising agent,
but the operator of the radio station is not.

Ruling that
the City of Manila is without legal right to compel I. Beck,
Incorporated, to obtain a license as an advertising agent for its radio
broadcasting station KZIB, the result will be the reversal of the
judgment of the trial court and the substitution therefor of another
judgment against the defendant for the return to the plaintiff of the
sum of P655, with legal interest from June 8, 1932, and with the costs
of both instances.

Avanceña, C. J., Villa-Real, Hull, and Imperial, JJ., concur.