G.R. No.
111097 July 20, 1994
MAYOR PABLO P. MAGTAJAS & THE CITY OF CAGAYAN DE ORO
PRYCE PROPERTIES CORPORATION, INC.
There was instant opposition when PAGCOR announced the opening of a casino
in Cagayan de Oro City. Civic organizations angrily denounced the project. The
religious elements echoed the objection and so did the women's groups and the
youth. Demonstrations were led by the mayor and the city legislators. The media
trumpeted the protest, describing the casino as an affront to the welfare of the
city.
PAGCOR decided to expand its operations to Cagayan de Oro City. To this end,
it leased a portion of a building belonging to Pryce Properties Corporation, Inc.,
one of the herein private respondents, renovated and equipped the same, and
prepared to inaugurate its casino there during the Christmas season.
The reaction of the Sangguniang Panlungsod of Cagayan de Oro City was swift
and hostile. It enacted Ordinance No. 3353 reading as follows:
ORDINANCE NO. 3353
AN ORDINANCE PROHIBITING THE ISSUANCE OF BUSINESS
PERMIT AND CANCELLING EXISTING BUSINESS PERMIT TO ANY
ESTABLISHMENT FOR THE USING AND ALLOWING TO BE USED ITS
PREMISES OR PORTION THEREOF FOR THE OPERATION OF
CASINO.
ORDINANCE NO. 3375-93
AN ORDINANCE PROHIBITING THE OPERATION OF CASINO AND
PROVIDING PENALTY FOR VIOLATION THEREFOR.
Pryce assailed the ordinances before the Court of Appeals, where it was joined
by PAGCOR as intervenor and supplemental petitioner.
CA - declared the ordinances invalid and issued the writ prayed for to prohibit
their enforcement.
Hence petition for review.
CONTENTION: Cagayan de Oro City, like other local political subdivisions, is
empowered to enact ordinances for the purposes indicated in the Local
Government Code. It is expressly vested with the police power under what is
known as the General Welfare Clause now embodied in Section 16 as follows:
This section also authorizes the local government units to regulate properties and
businesses within their territorial limits in the interest of the general welfare.
The petitioners argue that by virtue of these provisions, the Sangguniang
Panlungsod may prohibit the operation of casinos because they involve games of
chance, which are detrimental to the people. Gambling is not allowed by general
law and even by the Constitution itself.
It is submitted that this interpretation is consonant with the policy of local
autonomy as mandated in Article II, Section 25, and Article X of the Constitution,
as well as various other provisions therein seeking to strengthen the character of
the nation
ISSUE:
Whether or not the assailed Ordinances is valid.
RULING:
NO.
The tests of a valid ordinance are well established. A long line of decisions has held
that to be valid, an ordinance must conform to the following substantive requirements:
1) It must not contravene the constitution or any statute.
2) It must not be unfair or oppressive.
3) It must not be partial or discriminatory.
4) It must not prohibit but may regulate trade.
5) It must be general and consistent with public policy.
6) It must not be unreasonable.
In this case, the court find that the ordinances violate P.D. 1869, which has the
character and force of a statute, as well as the public policy expressed in the decree
allowing the playing of certain games of chance despite the prohibition of gambling in
general.
The rationale of the requirement that the ordinances should not contravene a statute is
obvious. Municipal governments are only agents of the national government. Local
councils exercise only delegated legislative powers conferred on them by Congress as
the national lawmaking body. The delegate cannot be superior to the principal or
exercise powers higher than those of the latter. It is a heresy to suggest that the local
government units can undo the acts of Congress, from which they have derived their
power in the first place, and negate by mere ordinance the mandate of the statute.
This basic relationship between the national legislature and the local government units
has not been enfeebled by the new provisions in the Constitution strengthening the
policy of local autonomy. Without meaning to detract from that policy, we here confirm
that Congress retains control of the local government units although in significantly
reduced degree now than under our previous Constitutions. The power to create still
includes the power to destroy. The power to grant still includes the power to withhold or
recall. True, there are certain notable innovations in the Constitution, like the direct
conferment on the local government units of the power to tax, 12 which cannot now be
withdrawn by mere statute. By and large, however, the national legislature is still the
principal of the local government units, which cannot defy its will or modify or violate it.
The Court understands and admires the concern of the petitioners for the welfare of
their constituents and their apprehensions that the welfare of Cagayan de Oro City will
be endangered by the opening of the casino.
Casino gambling is authorized by P.D. 1869. This decree has the status of a statute that
cannot be amended or nullified by a mere ordinance. Hence, it was not competent for
the Sangguniang Panlungsod of Cagayan de Oro City to enact Ordinance No. 3353
prohibiting the use of buildings for the operation of a casino and Ordinance No. 3375-93
prohibiting the operation of casinos. For all their praiseworthy motives, these ordinances
are contrary to P.D. 1869 and the public policy announced therein and are
therefore ultra vires and void.
WHEREFORE, the petition is DENIED and the challenged decision of the respondent
Court of Appeals is AFFIRMED, with costs against the petitioners. It is so ordered.