The trial court ruled in favor of the Province.

On appeal, the CA ruled in favor of the San Joaquins, stating among others that the trial court suspend the expropriation proceedings until after the province shall have submitted toe requisite approval of the Department of Agrarian Reform to convert the classification of the property of the private respondents from agricultural to non- agricultural land (this is in deference to the Solicitor Generals view that the Province must first secure the approval of the Department of Agrarian Reform ( DAR) regarding the plan to expropriate the lands of the San Joaquins for use as a housing project. The province now defends its expropriation of the subject lands, claiming its authority from Sections 4 and 7 of the Local Government Code of 1983, and that the expropriation was for a public purpose. Held : The Province of Camarines Sur is correct. Reasons: 1. Public use now means public advantage, convenience or benefit, which tends to contribute to the general welfare and the prosperity of the whole community, like are sort community or a housing complex. In the cage, the expropriation here is for public purpose. The establishment of a pilot center would inure to the direct benefit and advantage of the people of the Province. Once operational, the center would make available to the community invaluable information and technology on agriculture, fishery and the cottage industry. Ultimately, the livelihood of fisherman, farmers, and craftsmens would be enhanced. The housing project also satisfies the public purpose requirement of the Constitution. 2. As to the issue whether the approval of the DAR (for the purpose of realizing the housing project intent of the expropriation) is needed before expropriation proceedings can continue, the Court simply ruled that the same is not needed, simply because the L:GC of 1983 nor any other laws does not require the same.
7. Moday v. CA 268 SCRA 586 Facts : On July 23,, 1989, the Sangguniang Bayan of Bumawan in Agusan del Sur passed Resolution No. 43-89

authorizing the Municipal Mayor to initiate the expropriation of a one (1) hectare portion of Lot No. 6138 Pls-4 along the National Highway owned by Percival Moday for the site of the Bunawan Farmers Center and other Government Sports Facilities. Said Resolution was approved by then Municipal Mayor Anuncio Bustillo and transmitted to the Sangguniang Panlalawigan. The Sangguniang Panlalawigan however disapproved the resolution on the ground that the expropriation was unnecessary considering that there are still available lots in Bunawan for the establishment of government center. Undaunted, the Municipality of Bunawan nevertheless filed a petition for Eminent Domain against Moday. After depositing the necessary amount in accordance with Rule 67 of the Rules of Court with the municipal treasurer, the Municipality filed a Motion to Take or Enter Upon the Possession of the Subject Matter. Despite Modays opposition and after the hearing of the merits, the RTC ruled in favor of the Municipality, saying that among others, that since the Sangguniang Panlalawigan failed to declare the Municipalitys resolution as invalid, the same should be deemed effective. (Wow, the RTC has 2 different meanings for invalid and disapproval). An appeal to the CA also proved fruitless. In the meantime, the Municipality created 3 buildings on the subject property. Upon petition by Moday, the SC issued a TRO to prevent the Municipality from using the buildings it already constructed as well as constructing future buildings. Moday, in his petition to the SC, also adds that since the Sangguniang Panlalawigan disapproved the resolution, the same is void and thus the Municipality could not insist in pushing through with the expropriation.

Held : Moday is wrong. Reasons:

1) The Municipalitys power to exercise the right of eminent domain is not disputed. Sec. 9 of the LGHC of 1983 states, LGUs may, through its head, and acting pursuant to a resolution of its Sanggunian, exercise the right of eminent domain and institute condemnation proceedings for public use or purpose. 2) A reading of Sec. 153, LGC of 1983 states, If the Sangguniang Panlalawigan (SP) shall find that any municipal ordinance, resolution or executive order is beyond the power conferred upon the Sangguniang bayan (SB) or the Mayor, it shall declare such ordinance, resolution or Executive Order invalid in whole or in part xxx. The effect of such action shall be to annul the ordinance, resolution or Executive Order in question in whole or in part. The action of the SP shall be final. Said section gives the condition if such resolution is beyond the power conferred upon by the Sangguniang Bayan or Mayor xxx. Obviously, it is well within the power of the Municipality to exercise the right of eminent domain and thus, the SB has the capacity to promulgate a resolution pursuant to the exercise of such a right. The SP therefore, was without authority to disapprove said resolution. 3. Finally, Moday claimed the expropriation against his property was motivated by political revenge since he did not support Mayor Bustillos candidacy in the previous elections. If that were true, then Modays petition would have been meritorious since the taking of private property for public use must be genuine. The SC simply ruled that there was no evidence to support such claim. Besides, the records do not show that there was indeed another available property for the same purpose.
C) Power of Taxation (Five requisites for the exercise, publication requirements and public hearing) Five requisites for the exercise:

1. Municipal revenue obtainable by taxation shall be derived from such sources only as are expressly authorized by law. 2. Taxation shall be just and uniform in each municipality. 3. It shall not be in the power of the municipal council to impose tax in any form, whatever upon goods and merchandize carried into the municipality, or out of the same, and any attempt to impose an import or export tax upon such goods in the guise of an unreasonable charge for wharfage, use of bridges or otherwise, shall be void.
Note: Compare this with Sec 133 (e) of LGC 1991, Unless otherwise provided herein, the exercise of the taxing powers

of provinces, cities, municipalities and barangays shall not extend to the levy of the following xxx (e) taxes, fees and charges and other impositions upon goods carried into or out of, or passing through, the territorial jurisdictions of LGUs in the guise of charges of wharfage, tolls for bridges or otherwise, or other taxes, fees or charges in any form whatsoever upon such goods or merchandise. 4. In no case shall the collection of municipal taxes be left to any person. 5. Except as allowed by law, municipal funds shall be devoted exclusively to local public purpose.
Publication Requirements:

1. Two modes of apprising the public of a new ordinance according to Sec. 43 Local Tax Code (based on the Allied Thread v. City of Manila case) a. By means of publication in a newspaper of general circulation, or b. By means of posting of copies thereof in the local legislative hall or premises and 2 other conspicuous places within the territorial jurisdiction of the local government.

2. Publication of Tax Ordinances and Revenue Measures (Sec. 188, LGC of 1991) 3. Within 10 days after their approval, certified true copies of all provincial, city and municipal ordinances of revenue measures shall be published in full for 3 consecutive days in a newspaper of local circulation. Provided, however, that in provinces, cities and municipalities where there are no newspapers of local circulation, the same may be posted in at least 2 conspicuous and accessible places.
Public Hearing: 1. Procedure for Approval and Effectivity of Tax Ordinances and revenue Measures; Mandatory Public Hearings (sec 187, LGC of 1991)

- The procedure for the approval of local tax ordinances and revenue measures shall be in accordance with the provisions of this Code: Provided that any question on the constitutionality or legality of tax ordinances or revenue measures may be raised on appeal within 30 days from the effectivity thereof to the Secretary of Justice who shall render a decision within 60 days from the date of the receipt of the appeal. Provided, however, that such appeal do not have the effect of suspending the effectivity of ordinance and the accrual and payment of the tax, fee or charge therein. Provided, finally, that within 30 days after the receipt of the decision or the lapse of the 60-day period without the Secretary of Justice acting upon the appeal, the aggrieved party may file appropriate proceedings with a court of competent jurisdiction. 2. Power to Levy Other Taxes, Fees and Charges ( Sec. 186, LGC of 1991) Local governments may exercise the power to levy taxes, fees or charges on any base or subject not otherwise enumerated herein or taxed under the provisions of the National Internal Revenue Code (NLRC), as amended, or other applicable laws. Provided, that the taxes, fees or charges shall not be unjust, excessive, confiscatory or contrary to declared national policy; Provided further, that the ordinance levying such taxes, fees or charges shall not be enacted without any prior public hearing conducted for the purpose.
1.a Allied Thread Co. v. City Mayor of Manila 133 SCRA 338 Facts : Allied Thread Co is engaged in the business of manufacturing of sewing thread and yarn under duly

registered trademark and labels. It operates its factories and maintains an office in Pasig, Rizal. In order to sell its products in Manila and other parts of the Philippines, Allied Thread Co engaged the services of a sales broker, Ker and Company Ltd, the latter deriving commission for every sale made for its principal. On June 12, 1974, the Municipal Board of the City of Manila enacted Ordinance No. 7516 imposing on manufacturers, importer, porters or producers, doing business in the city of Manila, business taxes based on gross sales recorded on a graduated basis. A s used by the Ordinance, graduated basis meant that 60% of all sales recorded in the principal offices of all businesses are located in the City of Manila, the same shall be taxable as well by said City. As for the branches of businesses, all sales recorded by it shall be taxable by the City of Manila provided they are also located in the said City. The Mayor of Manila approved said Ordinance on June 15, 1974. In less than two months, however, the ordinance underwent a series of amendments. The last amendment was approved by the Mayor on July 29, 2974. Having affected by the aforementioned Ordinance, being manufacturers and sales brokers, Allied Thread Co filed a petition for declaratory relief contending that Ordinance 7516 is not valid or enforceable as the same is contrary to Sec

52 of PD 426, as clarified by Local Tax Regulation No 1-71. To quote said Regulation: A local tax ordinance shall go into effect on the 15th day after approved by the local chief executive in accordance with Sec 41 of the Code. In view hereof and considering the provisions of Art 54 of the Code regarding the accrual of taxes a local tax ordinance intended to take effect on July 1, 1974 should be enacted by the local chief executive not later than June 15, 1974. Otherwise stated, Allied Thread Co asserts that due to the series of amendments in the Ordinance 7516, the same Ordinance fell short of the deadline set forth by Sec 54 of PD 426 that for an ordinance intended to take effect on July 1, 1974, it must be enacted on or before June 15, 1954. As mentioned earlier, the last amendment of the ordinance was approved on July 29, 1974. Allied Thread also contended that the questioned Ordinance did not comply with the necessary publication requirement in a newspaper of general circulation as mandated by Sec43 of the Local Tax Code. Moreover, Allied Thread claimed that it should not be covered by the said Ordinance as amended; because it does not operate or maintain a branch office in Manila and that its principal office and factory are located in Pasig, Rizal.
Held : Allied Thread is wrong. Reasons:

1. Ordinance No 7516 was approved by the City Mayor in June 15, 1974. Therefore, he made the deadline (barely). The subsequent amendments did not in any way invalidate nor move the date of its effectivity. To hold otherwise would limit the power of the defunct Municipal Board of Manila to amend an existing ordinance as exigencies require. 2. The Court is persuaded that there was substantial compliance of the law on publication. The City of Manila complied with the second mode of notice. 3. Allied Thread does its business through its agent, Ker and Company. The power to levy an excise tax upon the performance of an act or the engaging of an occupation does not depend on the domicile of the person subject to the excise nor upon the physical location of the property and in connection with the act or occupation taxed but depend upon the place in which the act is performed or occupation engaged in in this case, upon the place where the respected sales transactions is perfected and consummated.
1.b Reyes v. CA 320 SCRA 486 Facts : The Sangguniang Bayan of San Juan, Metro Manila implemented 5 tax ordinances. Antonio Reyes and 2

others (the Reyes Three) filed an appeal with the Department of Justice alleging the constitutionality of these tax ordinances allegedly because they were promulgated without previous public hearings thereby constituting deprivation of property without due process of law. Secretary of Justice Franklin Drilon however, dismissed the appeal for being filed out of time since the last of the 5 ordinances took effect on Oct 29, 2992 while the Reyes Three filed their appeal only on May 21, 1993, way past the 30-day period from the effectivity thereof for appeal as allowed by Sec 187 of the LGC of 1993. The CA also ruled in favor of Franklin Drilon. Undaunted, the Reyes Three, in a petition for review with the SC, claim that notwithstanding the 30-day period imposed by the law for appeal, an ordinance enacted without the requisite of public hearing is unconstitutional and thus void from the beginning ( in other words, an action to declare anything unconstitutional does not prescribe since it is reduction as absurdum). Also the Reyes Three ask if constitutionality of Sec. 187 can be raised for the first time on appeal. (see Public Hearing of this reviewer).
Held : The Reyes Three are wrong: Reasons:

1. There is a reason why protests over tax ordinances are required to be done within certain time frames. A municipal tax ordinance empowers an LGU to impose taxes. The power to tax is one of the most effective instruments to raise needed

revenues to finance and support the myriad activities of LGUs for the delivery of basic services essential to the promotion of the general welfare and enhancement of peace, progress and prosperity of the people. Consequently, any delay in tax measures would be to the detriment of the public. 2. While it is true that the public hearings are required to be conducted prior to the enactment of a tax ordinance, the Reyes Three did not show any proof that the Sangguniang Bayan of San Juan failed to conduct the required public hearings. The reason is that the lack of a public hearing is a negative allegation essential to a petitioner cause of action. Hence, as the Reyes Three are the ones asserting the lack of a public hearing, they have the burden of proof. Since the Reyes Three failed to rebut the presumption of validity in favor of the subject ordinances and to discharge the burden of proving that no public hearings were conducted prior to the enacted thereof, the Court is constrained to uphold their constitutionality or legality. This is true despite the fact that the Sanggunian has the control of records or the better means of proof regarding the alleged, and the Reyes Three are not relieved from the burden of proving their averments. 3. On the validity of Sec. 187 of LGC of 1991, the Court stresses that the constitutionality of an act of Congress will not be passed upon by the Court unless at the first opportunity that question is properly raised and presented in an appropriate case, and is necessary for the determination of the case, particularly where the issue of constitutionality is the very lis mota presented. The constitutionality of a statutory provision should not be entertained by the Court where it was not specifically raised below, insisted upon and adequately argued. The Court finds no real necessity in tackling the constitutionality of Sec. 187 of LGC of 1991.
2. Limitations on municipal taxing power (2)The third objection is, likewise, untenable. The tax of P0.10 per case of 24 bottles, of soft drinks of

carbonated drinks in the production and sale of which plaintiff is engaged or less than P0.0042 per bottle is manifestly too small to be excessive, oppressive, or confiscatory. (3)The first and the fourth objection merit, however, serious consideration. As amended by Ordinance no. 122, the tax is imposed only upon any agent and/or consignee of any person, association, partnership, company or corporation engaged in selling soft drinks or carbonated drinks. As defined in section 3-A of Ordinance no. 122, a consignee of agent shall mean any person, association, partnership, company or corporation who acts in the place of another by authority from him or one entrusted with the business of another or to whom is consigned or shipped no less than 1,000 cases of hard liquors or soft drinks every month for resale, either retail or wholesale. As a consequence, merchants engaged in the sale of soft drinks of carbonated drinks, are not subjected to the tax, unless they are agents and/or consignee of another dealer, who, in the very nature of things, must be one engaged in the business outside the City. The intention to limit the application of the ordinance to soft drinks and carbonated drinks brought into city from outside thereof becomes apparent. Viewed from this angle, the tax partakes of the nature of an import duty, which is beyond defendants authority to impose by express provision of law. The tax in question would still be invalid, as discriminatory, and hence, violative of the uniformity required by the Constitution and the law thereof, since only sales by agents of consignee of outside dealers would be subject to tax. Sales by local dealers, not acting for or on behalf of other merchants, regardless of the volume of their sales, and even if the same exceeded those made by said agents or consignee of producers or merchants established outside the City of Butuan, would be exempt from the disputed tax.
2. b Province of Bulacan v. CA 299 SCRA 442 Facts : on June 26, 1992, the Sangguniang Panlalawigan of Bulacan passed Provincial Ordinance No. 3, known

as an Ordinance Enacting the Revenue Code of the Bulacan Province. Which was to take effect on July 1, 1992. Section 21 of the ordinance provides as follows: Sec. 21. Imposition of Tax. There is hereby levied and collected a tax of 10% of the fair market value in the locality per cubic meter of ordinary stones, sand, gravel, earth and other quarry resources, such. But not limited to marble, granite, volcanic cinders, basalt, tuff and rock phosphate. Extracted from public lands or from bed of seas, lakes, rivers, streams, creeks and other public waters within its territorial jurisdiction. Pursuant thereto, the Provincial Treasurer of Bulacan, in a letter dated November 11, 1993, assessed private respondent Republic Cement corporation (hereafter Republic Cement) O2,524,692.13 for extracting limestone, shale and silica from several parcels of private land in the province during the third quarter of 1992 until the second quarter of 1993. Believing that the province, on the basis of above-said ordinance, had no authority to impose taxes o quarry resources extracted from private lands, Republic Cement formally contested the same on December 23, 1993. The same was however, denied by the Provincial Treasurer on January 17, 1994. Republic Cement consequently filed a petition for declaratory relief with the Regional Trial Court of Bulacan on February 14, 1994. The province filed a motion to dismiss Republic Cements petition, which was granted by the trial court on May 13, 1993, which ruled that declaratory relief was improper, allegedly because a breach of the ordinance had been committed by Republic Cement. On July 11, 1994, Republic Cement filed a petition for certiorari with the Supreme Court seeking to reverse the trial courts dismissal of their petition. The Court, in a resolution dated July 27, 1994, referred the same to the Court of Appeals. In the interim, the Province of Bulacan issued a warrant of levy against Republic Cement, allegedly because of its unpaid tax liabilities. Negotiations between Republic Cement and the province resulted in an agreement and modus vivendi on December 12, 1994, whereby Republic Cement Agreed to pay under protest P1,262,364.00, 50% of the tax assessed by petitioner, in exchange for the lifting of the warrant of levy. Furthermore, Republic Cement and the Province Agreed to limit the issue for resolution by the Court of Appeals to the question as to whether or not the provincial government could pursuant to Section 21of Provincial Ordinance No. 3. The CA ruled that the Province had no authority to issue Ordinance No. 3, hence this appeals to the SC. Held : The decision of the CA must be sustained. Reasons:
(1)

Ordinance No. 3 is based on Sec. 158 of the LGC of 1991 which states: The province may levy and collect not more than ten percent (10%) of fair market value in the locality per cubic meter of ordinary stones, sand, gravel, earth and other quarry resources, as defined under the National Internal Revenue Code, as amended, extracted from private lands. Need we say more?
(2)

It is true that under Sec. 133 (h), the exercise of the taxing powers of provinces, cities, municipalities and barangays shall not extend to the levy of exercise taxes on articles enumerated under the National Internal Revenue Code (NIRC). Section 151 of the NIRC, by the way levies excise taxes on all quarry resources, regardless of origin, whether extracted from public or private land. Thus an LGU may not ordinarily impose taxes on stones, sand, earth and other quarry resources, as the same are already taxed under the National Internal Revenue Code, However an LGU can still impose a tax on stones, sand, gravel, earth and other quarry resources extracted from public land because it is

expressly empowered to do so under the LGU. But again it only says Public The Province of Bulacan cannot tax Republic Cement because its extracting minerals from private lands. Dont forget, public versus private.
3. Other Illustrative Cases: 3. a Basco v. PAGCOR 197 SCRA 52 Facts : Atty. Humberto Basco, the Chairman on the committee of Laws of the City Council of Manila, and 3 other

lawyers, (the Basco Four) filed a petition seeking to annul the Phil. Amusement and Gaming Corporation (PAGCOR) because among others. 1) It waived the Manila City governments right to impose taxes and license fees, which is recognized by law and 2) for the same reason stated in the immediately preceding paragraph, the law has intruded into the local governments right to impose local taxes and license fees in contravention of the constitutionally enshrined principle of the local autonomy.
Held : The Basco four contentions are all unmeritorious Reasons:

1) Any petitioner assailing the constitionality of the law must realize that said law is armed with the presumption of constitionality. With this in mind, the petitioner has the burden of proof to show that the law he wishes to assail is unconstitutional.

2)The Basco Four assailed Sec. 13 par. 2 of P.D 1869 which states that LGUs cannot impose on PAGCOR
taxes on any kind (except for the 5% franchise tax) Said provision, they claim is a violation of local autonomy it waives the City of Manilas right to impose taxes and license fees. The court answered that. a) The City of Manila being a Mere municipal corporation has no inherent right to impose taxes. Thus, the Charter or statute must plainly show am intent to confer that power or the municipality cannot assume it. Its power to tax therefore must always yield to a legislative act which is superior having been passed upon by the state itself which has the inherent power to tax. b) The charter of the City of Manila is subject to control by congress. It should be stressed that municipal corporation are mere creatures of Congress which has the power to create and abolish municipal corporation due to its legislative powers Congress, therefore, has the power of control over Local. And if Congress can grant the City of Manila the power to tax certain matters, it can also provide for exemption or even take back the power. c) The City of Manilas power to impose licenses fees on gambling has long been revoked. As early as 1975, the power of local government to regulate gambling thru the grant of franchise, licenses or permits was withdrawn by P.D. No. 771 and was vested exclusively on the National Government. PAGCOR is a government owned or controlled corporation with an original charter, PD 1869. All its stocks are owned by the National Government: it has dual role, to operate and to regulate gambling casinos. The latter role is governmental, which places it in the category of an agency or instrumentality of the Government. Being an instrumentality of the Government, PAGCOR should be and actually is exempt from local taxes. Otherwise, its operation might be burdened, impeded or subjected to control by a mere Local Government. (3)

The states have no power by taxation or otherwise, to retard, impede, burden or in any manner control the operation of constitutional laws enacted by Congress to carry into execution the powers vested in the federal government. This doctrine emanates from the supremacy of the National Government over local governments. Otherwise, mere creatures of the state can defeat National policies thru extermination of what local authorities may perceive to be undesirable activities or enterprise using the power to tax as a tool for regulation. (4) The Basco Four cannot also invoke Article X, sec 5 of the 1987 Constitution which says, Each local government unit shall have the power to create its own source of revenue and to levy taxes, fees, and other charges subject to such guidelines and limitation as the congress may provide, consistent with the basic policy on local autonomy. Such taxes, fees and charges shall exclusively to the local government. The power of local government to impose taxes and fees is always subject to limitations which Congress may provide by law.
3. b Mactan Cebu Intl Airport v. Marcos Facts : Mactan Cebu International Airport Authority (MCIAA) was created by virtue of Republic Act No. 6958

mandated to principally undertake to economical, efficient and effective control, management and supervision of the Mactan International Airport in the province of Cebu and the Lahug Airport in Cebu City, and such other Airports as may be established in the province of Cebu. It is also mandated to a) encourage, promote and develop international and domestic air traffic in the Central Visayas and Mindanao regions as a means of making the regions centers of international trade and tourism, and accelerating the development of the means of transportation and communication in the country; and b) upgrade the service and facilities of the airports and to formulate internationally acceptable standards of accommodation and service. Since the time of its creation, petitioner MCIAA enjoyed the privilege of exemption from payment of realty taxes imposed by the National Government or any of its political subdivisions, agencies and instrumentalities in accordance with Section 14 of its charter.