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Lina, Jr. vs. Paño
*
G.R. No. 129093. August 30, 2001.

HON. JOSE D. LINA, JR., SANGGUNIANG PANLALAWIGAN

OF LAGUNA, and HON. CALIXTO CATAQUIZ, petitioners, vs.
HON. FRANCISCO DIZON PAÑO and TONY CALVENTO,
respondents.

Municipal Corporations; Local Government Units; Ordinances;

Gambling; An ordinance which merely states the “objection” of the council
to lotto is but a mere policy statement on the part of the local council which
is not self-executing, and could not serve as a valid ground to prohibit the
operation of the lotto system in the province.—The entire controversy
stemmed from the refusal of Mayor Cataquiz to issue a mayor’s permit for
the operation of a lotto outlet in favor of private respondent. According to
the mayor, he based his decision on an existing ordinance prohibiting the
operation of lotto in the province of Laguna. The ordinance, however,
merely states the “objection” of the council to the said game. It is but a mere
policy statement on the part of the local council, which is not selfexecuting.
Nor could it serve as a valid ground to prohibit the operation of the lotto
system in the province of Laguna.
Same; Same; Same; Same; While a policy statement expressing the
local government’s objection to the lotto is valid, as it is part of the local
government’s autonomy to air its views which may be contrary to that of the
national government’s, this freedom to exercise contrary views does not
mean that local governments may actually enact ordinances that go against
laws duly enacted by Congress.—As a policy statement expressing the local
government’s objection to the lotto, such resolution is valid. This is part of
the local government’s autonomy to air its views which may be contrary to
that of the national government’s. However, this freedom to exercise
contrary views does not mean that local governments may actually enact

_______________

* SECOND DIVISION.

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Lina, Jr. vs. Paño

ordinances that go against laws duly enacted by Congress. Given this

premise, the assailed resolution in this case could not and should not be
interpreted as a measure or ordinance prohibiting the operation of lotto.
Same; Same; Same; Same; What the national legislature allows by law,
such as lotto, a provincial board may not disallow by ordinance or
resolution.—The game of lotto is a game of chance duly authorized by the
national government through an Act of Congress. Republic Act 1169, as
amended by Batas Pambansa Blg. 42, is the law which grants a franchise to
the PCSO and allows it to operate the lotteries, x x x This statute remains
valid today. While lotto is clearly a game of chance, the national
government deems it wise and proper to permit it. Hence, the Sangguniang
Panlalawigan of Laguna, a local government unit, cannot issue a resolution
or an ordinance that would seek to prohibit permits. Stated otherwise, what
the national legislature expressly allows by law, such as lotto, a provincial
board may not disallow by ordinance or resolution.
Same; Same; Same; In our system of government, the power of local
government units to legislate and enact ordinances and resolutions is merely
a delegated power coming from Congress.—In our system of government,
the power of local government units to legislate and enact ordinances and
resolutions is merely a delegated power coming from Congress. As held in
Tatel vs. Virac, ordinances should not contravene an existing statute enacted
by Congress. The reasons for this is obvious, as elucidated in Magtajas v.
Pryce Properties Corp. Municipal governments are only agents of the
national government. Local councils exercise only delegated legislative
powers conferred upon 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. Municipal corporations owe their origin to, and derive their powers
and rights wholly from the legislature. It breathes into them the breath of
life, without which they cannot exist. As it creates, so it may destroy. As it
may destroy, it may abridge and control. Unless there is some constitutional
limitation on the right, the legislature might, by a single act, and if we can
suppose it capable of so great a folly and so great a wrong, sweep from
existence all of the municipal corporations in the state, and the corporation
could not prevent it. We know of no limitation on the right so far as the
corporation themselves are concerned. They are, so to phrase it, the mere
tenants at will of the legislature (citing Clinton vs. Ceder Rapids, etc.
Railroad Co., 24 Iowa 455).

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Lina, Jr. vs. Paño

Same; Same; Same; Ours is a unitary form of government, not a

federal state.—Ours is still a unitary form of government, not a federal
state. Being so, any form of autonomy granted to local governments will
necessarily be limited and confined within the extent allowed by the central
authority. Besides, the principle of local autonomy under the 1987
Constitution simply means “decentralization”. It does not make local
governments sovereign within the state or an “imperium in imperio.”
Same; Same; Same; Gambling; Sections 2 (c) and 27 of the Local
Government Code (Republic Act 7160) apply only to national programs
and/or projects which are to be implemented in a particular local
community—lotto is neither a program nor a project of the national
government, but of a charitable institution, the PCSO, and it is far fetched
to say that lotto falls within the contemplation of aforesaid legal provisions.
—From a careful reading of said provisions, we find that these apply only to
national programs and/or projects which are to be implemented in a
particular local community. Lotto is neither a program nor a project of the
national government, but of a charitable institution, the PCSO. Though
sanctioned by the national government, it is far fetched to say that lotto falls
within the contemplation of Sections 2 (c) and 27 of the Local Government
Code.

PETITION for review on certiorari of a decision of the Regional

Trial Court of San Pedro, Laguna, Br. 93.

The facts are stated in the opinion of the Court.

Office of the Provincial Legal Officer for petitioners.
Edgardo B. Arellano for private respondent.

QUISUMBING, J.:

For our resolution is a petition

1
for review on certiorari seeking the
reversal of the decision dated February 10, 1997 of the Regional
Trial Court of San Pedro, Laguna, Branch 93, enjoining petitioners
from implementing or enforcing Kapasiyahan Bilang 508, Taon
1995, of the Sangguniang2
Panlalawigan of Laguna and its
subsequent Order dated April 21, 1997 denying petitioners’ motion
for reconsideration.

_______________

1 Rollo, pp. 18-20.

2 Id. at 21.

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Lina, Jr. vs. Paño

On December 29, 1995, respondent Tony Calvento was appointed

agent by the Philippine Charity Sweepstakes Office (PCSO) to
install Terminal OM 20 for the operation of lotto. He asked Mayor
Calixto Cataquiz, Mayor of San Pedro, Laguna, for a mayor’s permit
to open the lotto outlet. This was denied by Mayor Cataquiz in a
letter dated February 19, 1996. The ground for said denial was an
ordinance passed by the Sangguniang Panlalawigan of Laguna
entitled Kapasiyahan Blg. 508, Taon 1995 which was issued on
September 18, 1995. The ordinance reads:

ISANG KAPASIYAHAN TINUTUTULAN ANG MGA “ILLEGAL GAM

BLING” LALO NA ANG LOTTO SA LALAWIGAN NG LAGUNA

SAPAGKAT, ang sugal dito sa lalawigan ng Laguna ay talamak na;

SAPAGKAT, ang sugal ay nagdudulot ng masasamang impluwensiya
lalo’t higit sa mga kabataan;
KUNG KAYAT DAHIL DITO, at sa mungkahi nina Kgg. Kgd. Juan M.
Unico at Kgg. Kgd. Gat-Ala A. Alatiit, pinangalawahan ni Kgg. Kgd.
Meliton C. Larano at buong pagkakaisang sinangayunan ng lahat ng dumalo
sa pulong;
IPINASIYA, na tutulan gaya ng dito ay mahigpit na TINUTUTULAN
ang ano mang uri ng sugal dito sa lalawigan ng Laguna lalo’t higit ang
Lotto;
IPINASIYA PA RIN na hilingin tulad ng dito ay hinihiling sa
Panlalawigang pinuno ng Philippine National Police (PNP) Col. [illegible]
na mahigpit na pag-ibayuhin ang pagsugpo sa lahat ng3 uri ng illegal na sugal
sa buong lalawigan ng Laguna lalo na ang “Jueteng.”

As a result of this resolution of denial, respondent Calvento filed a

complaint for declaratory relief with prayer for preliminary
injunction and temporary restraining order. In the said complaint,
respondent Calvento asked the Regional Trial Court of San Pedro
Laguna, Branch 93, for the following reliefs: (1) a preliminary
injunction or temporary restraining order, ordering the defendants to
refrain from implementing or enforcing Kapasiyahan Blg. 508, Taon
1995; (2) an order requiring Hon. Municipal Mayor Calixto R.
Cataquiz to issue a business permit for the operation of a lotto

_______________

3 Records, pp. 8-8-A.

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Lina, Jr. vs. Paño

outlet; and (3) an order annulling or declaring as invalid

Kapasiyahan Blg. 508, Taon 1995.
On February 10, 1997, the respondent judge, Francisco Dizon
Paño, promulgated his decision enjoining the petitioners from
implementing or enforcing resolution or Kapasiyahan Blg. 508,
Taon 1995. The dispositive portion of said decision reads:

WHEREFORE, premises considered, defendants, their agents and

representatives are hereby enjoined from implementing or enforcing
resolution or kapasiyahan blg. 508, Taon 1995 of the Sangguniang
Panlalawigan ng Laguna prohibiting the operation of the lotto in the
province of Laguna.4
SO ORDERED.

Petitioners filed a motion for reconsideration which was

subsequently denied in an Order dated April 21, 1997, which reads:

Acting on the Motion for Reconsideration filed by defendants Jose D. Lina,

Jr. and the Sangguniang Panlalawigan of Laguna, thru counsel, with the
opposition filed by plaintiffs counsel and the comment thereto filed by
counsel for the defendants which were duly noted, the Court hereby denies
the motion for lack 5of merit.
SO ORDERED.

On May 23, 1997, petitioners filed this petition alleging that the
following errors were committed by the respondent trial court:

THE TRIAL COURT ERRED IN ENJOINING THE PETITIONERS

FROM IMPLEMENTING KAPASIYAHAN BLG. 508, TAON 1995 OF
THE SANGGUNIANG PANLALAWIGAN OF LAGUNA PROHIBITING
THE OPERATION OF THE LOTTO IN THE PROVINCE OF LAGUNA.

_______________

4 Rollo, p. 20.
5 Id. at 21.

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Lina, Jr. vs. Paño

II

THE TRIAL COURT FAILED TO APPRECIATE THE ARGUMENT

POSITED BY THE PETITIONERS THAT BEFORE ANY
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GOVERNMENT PROJECT OR PROGRAM MAY BE IMPLEMENTED

BY THE NATIONAL AGENCIES OR OFFICES, PRIOR
CONSULTATION AND APPROVAL BY THE LOCAL GOVERNMENT
UNITS CONCERNED AND OTHER CONCERNED SECTORS IS
REQUIRED.

Petitioners contend that the assailed resolution is a valid policy

declaration of the Provincial Government of Laguna of its vehement
objection to the operation of lotto and all forms of gambling. It is
likewise a valid exercise of the provincial government’s police
power under the General Welfare Clause of Republic 6Act 7160,
otherwise known as the Local Government Code of 1991. They also
maintain that respondent’s lotto operation is illegal because no prior
consultations and approval by the local government were sought
before it was implemented contrary 7
to the express provisions of
Sections 2 (c) and 27 of R.A. 7180.
For his part, respondent Calvento argues that the questioned
resolution is, in effect, a curtailment of the power of the state since
in this case the national legislature itself had already declared
8
lotto
as legal and permitted its operations around the country. As

_______________

6 Id. at 13.
7 Section 2. Declaration of Policy, x x x

(c) It is likewise the policy of the State to require all national agencies and offices to conduct
periodic consultations with appropriate local government units, non-governmental and people’s
organizations, and other concerned sectors of the community before any project or program is
implemented in their respective jurisdictions.
Section 27. Prior Consultations Required. No project or program shall be implemented by
government authorities unless the consultations mentioned in Section 2 (c) and 26 hereof are
complied with, and prior approval of the sanggunian concerned is obtained; Provided, that
occupants in areas where such projects are to be implemented shall not be evicted unless
appropriate relocation sites have been provided, in accordance with the provisions of the
Constitution.

8 Rollo, p. 25.

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for the allegation that no prior consultations and approval were

sought from the sangguniang panlalawigan of Laguna, respondent
Calvento contends this is not mandatory since such a requirement is
merely stated as a declaration of policy and not a9 self-executing
provision of the Local Government Code of 1991. He also states
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that his operation of the lotto system is legal because of the authority
given to him by the PCSO, which in 10turn had been granted a
franchise to operate the lotto by Congress.
The Office of the Solicitor General (OSG), for the State,
contends that the Provincial Government of Laguna has no power to
prohibit a form of gambling
11
which has been authorized by the
national government. He argues that this is based on the principle
that ordinances should not contravene statutes as municipal
governments are merely agents of the national government. The
local councils exercise only delegated legislative powers which have
been conferred on them by Congress. This being the case, these
councils, as delegates, cannot be superior to the principal or exercise
powers higher than those of the latter. The OSG also adds that the
question of whether gambling should be permitted is for Congress to
determine, taking into account national and local interests. Since
Congress has allowed the PCSO to operate lotteries which PCSO
seeks to conduct in Laguna, pursuant to its legislative grant of
authority, the province’s Sangguniang Panlalawigan cannot nullify
the exercise of said authority by preventing something already
allowed by Congress.
The issues to be resolved now are the following: (1) whether
Kapasiyahan Blg. 508, Taon 1995 of the Sangguniang Panlalawigan
of Laguna and the denial of a mayor’s permit based thereon are
valid; and (2) whether prior consultations and approval by the
concerned Sanggunian are needed before a lotto system can be
operated in a given local government unit.
The entire controversy stemmed from the refusal of Mayor
Cataquiz to issue a mayor’s permit for the operation of a lotto out-

_______________

9 Id. at 27.
10 Id. at 28.
11 Id. at 58-61.

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let in favor of private respondent. According to the mayor, he based

his decision on an existing ordinance prohibiting the operation of
lotto in the province of Laguna. The ordinance, however, merely
states the “objection” of the council to the said game. It is but a mere
policy statement on the part of the local council, which is not self-
executing. Nor could it serve as a valid ground to prohibit the
operation of the lotto system in the province of Laguna. Even
petitioners admit as much when they stated in their petition that:
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5.7. The terms of the Resolution and the validity thereof are express and
clear. The Resolution is a policy declaration of the Provincial Government
of Laguna of its vehement opposition and/or objection to the operation of
and/or all forms
12
of gambling including the Lotto operation in the Province
of Laguna.

As a policy statement expressing the local government’s objection to

the lotto, such resolution is valid. This is part of the local
government’s autonomy to air its views which may be contrary to
that of the national government’s. However, this freedom to exercise
contrary views does not mean that local governments may actually
enact ordinances that go against laws duly enacted by Congress.
Given this premise, the assailed resolution in this case could not and
should not be interpreted as a measure or ordinance prohibiting the
operation of lotto.
The game of lotto is a game of chance duly authorized by the
national government through an Act of Congress. Republic Act
1169, as amended by Batas Pambansa Blg. 42, is the law which
grants a franchise to the PCSO and allows it to operate the lotteries.
The pertinent provision reads:

Section 1. The Philippine Charity Sweepstakes Office.—The Philippine

Charity Sweepstakes Office, hereinafter designated the Office, shall be the
principal government agency for raising and providing for funds for health
programs, medical assistance and services and charities of national
character, and as such shall have the general powers conferred in section
thirteen of Act Numbered One thousand four hundred fifty-nine, as
amended, and shall have the authority:

_______________

12 Id. 13.

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Lina, Jr. vs. Paño

A. To hold and conduct charity sweepstakes races, lotteries, and other

similar activities, in such frequency and manner, as shall be determined, and
subject to such rules and regulations as shall be promulgated by the Board
of Directors.

This statute remains valid today. While lotto is clearly a game of

chance, the national government deems it wise and proper to permit
it. Hence, the Sangguniang Panlalawigan of Laguna, a local
government unit, cannot issue a resolution or an ordinance that
would seek to prohibit permits. Stated otherwise, what the national

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legislature expressly allows by law, such as lotto, a provincial board

may not disallow by ordinance or resolution.
In our system of government, the power of local government
units to legislate and enact ordinances and resolutions is merely 13a
delegated power coming from Congress, As held in Tatel vs. Virac,
ordinances should not contravene an existing statute enacted by
Congress. The reasons for14 this is obvious, as elucidated in Magtajas
v. Pryce Properties Corp.

Municipal governments are only agents of the national government. Local

councils exercise only delegated legislative powers conferred upon 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.
Municipal corporations owe their origin to, and derive their powers and
rights wholly from the legislature. It breathes into them the breath of life,
without which they cannot exist. As it creates, so it may destroy. As it may
destroy, it may abridge and control. Unless there is some constitutional
limitation on the right, the legislature might, by a single act, and if we can
suppose it capable of so great a folly and so great a wrong, sweep from
existence all of the municipal corporations in the state, and the corporation
could not prevent it. We know of no limitation on the right so far as the
corporation themselves are concerned. They are, so to phrase it, the

_______________

13 207 SCRA 157, 161 (1992).

14 Magtajas vs. Pryce Properties Corp., 234 SCRA 255, 272-273 (1994).

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Lina, Jr. vs. Paño

mere tenants at will of the legislature (citing Clinton vs. Ceder Rapids, etc
Railroad Co., 24 Iowa 455).

Nothing in the present constitutional provision enhancing local

autonomy dictates a different conclusion.

The 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

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recall. True, there are certain notable innovations in the Constitution, like
the direct conferment on the local government units of the power to tax
(citing Art. X, Sec 5, Constitution), which cannot now be withdrawn by
mere statute. By and large, however, the national legislature is still the
principal of 15the local government units, which cannot defy its will or modify
or violate it.

Ours is still a unitary form of government, not a federal state. Being

so, any form of autonomy granted to local governments will
necessarily be limited and confined within the extent allowed by the
central authority. Besides, the principle of local autonomy under the
1987 Constitution simply means “decentralization”. It does not
make local governments
16
sovereign within the state or an “imperium
in imperio.”
To conclude our resolution of the first issue, respondent mayor of
San Pedro, cannot avail of Kapasiyahan Bilang 508, Taon 1995, of
the Provincial Board of Laguna as justification to prohibit lotto in
his municipality. For said resolution is nothing but an expression of
the local legislative unit concerned. The Board’s enactment, like
spring water, could not rise above its source of power, the national
legislature.
As for the second issue, we hold that petitioners erred in
declaring that Sections 2 (c) and 27 of Republic Act 7160, otherwise

_______________

15 Id. at 273.
16 Basco vs. Phil. Amusement and Gaming Corporation, 197 SCRA 52, 65 (1991).

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Lina, Jr. vs. Paño

known as the Local Government Code of 1991, apply mandatorily in

the setting up of lotto outlets around the country. These provisions
state:

Section 2. Declaration of Policy, x x x

(c) It is likewise the policy of the State to require all national agencies
and offices to conduct periodic consultations with appropriate local
government units, non-governmental and people’s organizations, and other
concerned sectors of the community before any project or program is
implemented in their respective jurisdictions.
Section 27. Prior Consultations Required.—No project or program shall
be implemented by government authorities unless the consultations
mentioned in Section 2 (c) and 26 hereof are complied with, and prior
approval of the sanggunian concerned is obtained; Provided, that occupants

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in areas where such projects are to be implemented shall not be evicted

unless appropriate relocation sites have been provided, in accordance with
the provisions of the Constitution.

From a careful reading of said provisions, we find that these apply

only to national programs and/or projects which are to be
implemented in a particular local community. Lotto is neither a
program nor a project of the national government, but of a charitable
institution, the PCSO. Though sanctioned by the national
government, it is far fetched to say that lotto falls within the
contemplation of Sections 2 (c) and 27 of the Local Government
Code.
Section 27 of 17the Code should be read in conjunction with
Section 26 thereof. Section 26 reads:

Section 26. Duty of National Government Agencies in the Maintenance of

Ecological Balance.—It shall be the duty of every national agency or
government-owned or controlled corporation authorizing or involved in the
planning and implementation of any project or program that may cause
pollution, climatic change, depletion of non-renewable resources, loss of
crop land, range-land, or forest cover, and extinction of animal or plant
species, to consult with the local government units, nongovernmental
organizations, and other sectors concerned and explain the

_______________

17 Aquilino Q. Pimentel, Jr., The Local Government Code of 1991, p. 124.

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Lina, Jr. vs. Paño

goals and objectives of the project or program, its impact upon the people
and the community in terms of environmental or ecological balance, and the
measures that will be undertaken to prevent or minimize the adverse effects
thereof.

Thus, the projects and programs mentioned in Section 27 should be

interpreted to mean projects and programs whose effects are among
those enumerated in Sections 26 and 27, to wit, those that: (1) may
cause pollution; (2) may bring about climatic change; (3) may cause
the depletion of non-renewable resources; (4) may result in loss of
crop land, range-land, or forest cover; (5) may eradicate certain
animal or plant species from the face of the planet; and (6) other
projects or programs that may call for the eviction of a particular
group of people residing in the locality where these will be
implemented. Obviously, none of these effects will be produced by
the introduction of lotto in the province of Laguna.

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Moreover, the argument regarding lack of consultation raised by

petitioners is clearly an afterthought on their part. There is no
indication in the letter of Mayor Cataquiz that this was one of the
reasons for his refusal to issue a permit. That refusal was predicated
solely but erroneously on the provisions of Kapasiyahan Blg. 508,
Taon 1995, of the Sangguniang Panlalawigan of Laguna.
In sum, we find no reversible error in the RTC decision enjoining
Mayor Cataquiz from enforcing or implementing the Kapasiyahan
Blg. 508, Taon 1995, of the Sangguniang Panlalawigan of Laguna.
That resolution expresses merely a policy statement of the Laguna
provincial board. It possesses no binding legal force nor requires any
act of implementation. It provides no sufficient legal basis for
respondent mayor’s refusal to issue the permit sought by private
respondent in connection with a legitimate business activity
authorized by a law passed by Congress.
WHEREFORE, the petition is DENIED for lack of merit. The
Order of the Regional Trial Court of San Pedro, Laguna enjoining
the petitioners from implementing or enforcing Resolution or
Kapasiyahan Blg. 508, Taon 1995, of the Provincial Board of
Laguna is hereby AFFIRMED. No costs.

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88 SUPREME COURT REPORTS ANNOTATED

Arreza vs. Diaz, Jr.

SO ORDERED.

Bellosillo (Chairman), Mendoza, Buena and De Leon, Jr.,

concur.

Petition denied, Order affirmed.

Notes.—Gambling is not illegal per se. (Kilosbayan,

Incorporated vs. Morato, 246 SCRA 540 [1995])
Horse racing although authorized by law is still a form of
gambling. (Manila Jockey Club, Inc. vs. Court of Appeals, 300
SCRA 181 [1998])

——o0o——

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