Mandanas vs.
Ochoa
G.R. No. 199802, JULY 3, 2018
BERSAMIN, J.:
FACTS:
This case involves a challenge against the manner of computing the Internal Revenue Allotment (IRA) for Local
Government Units (LGUs) in the Philippines. Congressman Mandanas, along with local officials from Batangas and legal
advocate Atty.Jose Malvar Villegas, filed a special civil action for certiorari, prohibition, and mandamus assailing the
computation of the IRA for the LGUs in the General Appropriations Act (GAA) for Fiscal Year 2012.
They contended that certain collections of National Internal Revenue Taxes (NIRTs) by the Bureau of Customs (BOC),
specifically excise taxes, value-added taxes (VATs), and documentary stamp taxes (DSTs), were not included in the base
amounts for IRA computation.
Congressman Enrique Garcia Jr., in a separate petition, sought
mandamus to compel respondents to compute the just share of LGUs based on all national
taxes.
The consolidated cases questioned whether the exclusion of certain national taxes from the
base amount for computing the LGUs’ just share was constitutional.
ISSUE:
Whether Section 284 of the LGC is unconstitutional for being repugnant to Section 6, Article X of the 1987 Constitution.
RULING:
NO. The Court held that the phrase “national internal revenue taxes” in Section 284 of the Local Government Code (LGC)
was more restrictive than “national taxes” indicated in the Constitution, making such limitation unconstitutional.
Consequently, all national taxes should be included in the base amount for determining the LGUs’ just share. A key
doctrine established in this case is that Local Government Units (LGUs) are entitled to a just share in all national taxes,
not limited to national internal revenue taxes, as per Section 6, Article X of the 1987 Constitution. This decision broadens
the base from which the just share of LGUs is computed, ensuring adherence to the constitutional mandate and
enhancing local fiscal autonomy.
The case highlights the principle that LGUs have a constitutionally guaranteed right to a just share in all national taxes
which should be automatically released to them. The legislative designation of their share must align with the expansive
constitutional definition of “national taxes,” encompassing all forms of national tax revenue. For quick reference, the
key legal provision is Section 6, Article X of the 1987 Constitution, indicating LGUs’ entitlement to a just share in national
taxes, subject to automatic release.
The decision is rooted in the 1987 Philippine Constitution’s emphasis on local autonomy and fiscal independence. The
Constitutional framers envisioned a political framework where LGUs are empowered financially to govern more
effectively and cater to their constituents’ needs. This case reflects the judicial affirmation of such constitutional intent,
mandating a broader interpretation of national taxes to include all tax revenues, thus rectifying years of
restrictive IRA computation that limited LGUs’ access to national tax revenues.
Manila Electric Co. vs. Province of Laguna
G.R. No. 131359, May 5, 1999
VITUG, J.:
FACTS:
Several municipalities in Laguna granted MERALCO franchise rights for electric supply through resolutions. Similarly, a
franchise was granted by the National Electrification Administration to MERALCO for Calamba, Laguna. The enactment
of the Local Government Code of 1991 (RA 7160) empowered local governments to levy taxes, leading Laguna to impose
a franchise tax via Ordinance No. 01-92. MERALCO, having paid a franchise tax to the National Government, protested
the additional tax imposed by Laguna, arguing it was covered by P.D. 551, which exempted them from further taxation.
The Provincial Treasurer of Laguna denied MERALCO’s claim for refund. Consequently, MERALCO sued for a refund in
the Regional Trial Court of Sta Cruz, Laguna, which upheld the validity of the tax ordinance. MERALCO then appealed to
the Supreme Court on several grounds, including the violation of the non-impairment clause and the conflict between
RA 7160 and P.D. 551.
ISSUE:
Whether Section 2.09 of the Laguna Provincial Ordinance No. 01-92 violates the non-impairment clause and P.D. 551.
RULING:
NO. The Supreme Court dismissed MERALCO’s petition. It held that local governments have broader tax powers under
the 1987 Constitution, subject to limitations and guidelines from Congress. RA 7160 enables local governments to
impose taxes on franchises, despite prior exemptions, aiming to ensure their viability and autonomy. The withdrawal of
exemptions under Section 193 of RA 7160 was deemed to include MERALCO’s, overriding P.D. 551. The Court
differentiated between contractual tax exemptions and those granted under franchises, stating that franchises could be
amended, altered, or repealed by Congress.
The decision established that the Local Government Code of 1991 (RA 7160) empowers local governments to impose
taxes on franchises, notwithstanding any previous exemption granted by law or special law, thereby withdrawing
previously granted tax exemptions to foster local government autonomy and self-sufficiency.
La Carlota City, Negros Occidental vs. Rojo
G.R. No. 181367, April 24, 2012
CARPIO, J.:
FACTS:
On March 18, 2004, Vice-Mayor Rex R. Jalandoon appointed Rojo, who had resigned from his position as a member of
the Sangguniang Panlungsod the previous day, to the position of Sangguniang Panlungsod Secretary with a permanent
status. The appointment papers were submitted to the Civil Service Commission Negros Occidental Field Office (CSCFO-
Negros Occidental) for attestation on March 19, 2004.
The CSCFO found issues in the appointment documents and considered the appointment permanently recalled or
withdrawn on April 14, 2004. Jalandoon appealed to the CSC Regional Office, which reversed the CSCFO's ruling and
approved Rojo's appointment.
Newly elected Mayor Jeffrey P. Ferrer and Vice-Mayor Demie John C. Honrado intervened, arguing that Jalandoon was
not the real party in interest and that Rojo's resignation was ineffective due to a lack of quorum.
The Civil Service Commission (CSC) dismissed the appeal by Ferrer and Honrado, affirming the regional office's decision.
The Court of Appeals upheld the CSC's decision, leading to the petition for review before the Supreme Court.
ISSUE:
WHETHER THE APPOINTMENT OF RESPONDENT AS SANGGUNIANG PANLUNGSOD SECRETARY VIOLATED THE
CONSTITUTIONAL PROSCRIPTION AGAINST ELIGIBILITY OF AN ELECTIVE OFFICIAL FOR APPOINTMENT DURING HIS
TENURE
RULING:
NO. RA 7160 clearly states that the Sangguniang Panlungsod "shall be composed of the city vice-mayor as presiding
officer, the regular sanggunian members, the president of the city chapter of the liga ng mga barangay, the president of
the panlungsod na pederasyon ng mga sangguniang kabataan, and the sectoral representatives, as members." Black’s
Law Dictionary defines "composed of" as "formed of" or "consisting of." As the presiding officer, the vice-mayor can vote
only to break a tie. In effect, the presiding officer votes when it matters the most, that is, to break a deadlock in the
votes. Clearly, the vice-mayor, as presiding officer, is a "member" of the Sangguniang Panlungsod considering that he is
mandated under Section 49 of RA 7160 to vote to break a tie. To construe otherwise would create an anomalous and
absurd situation where the presiding officer who votes to break a tie during a Sanggunian session is not considered a
"member" of the Sanggunian.
On the issue that respondent’s appointment was issued during the effectivity of the election ban, the Court agrees with
the finding of the Court of Appeals and the Civil Service Commission that since the respondent’s appointment was
validly issued on 18 March 2004, then the appointment did not violate the election ban period which was from March 26
to May 9, 2004. Indeed, the Civil Service Commission found that despite the lack of signature and certification of the
Human Resource Management Officer of La Carlota City on respondent’s appointment papers, respondent’s
appointment is deemed effective as of 18 March 2004 considering that there was substantial compliance with the
appointment requirements.
Javier vs. Cadiao
G.R. No. 185369, Aug 3, 2016
REYES, J.:
FACTS:
For the term 2007-2010, Vice Governor Rhodora J. Cadiao was the presiding officer of the Sangguniang Panlalawigan
(SP) of Antique. During the SP’s first regular session, the Lakas ng Tao-Christian Muslim Democrats (Lakas-CMD) party,
which included petitioners J. Tobias M. Javier and Vincent H. Piccio III, was the majority block. Piccio was the Majority
Floor Leader. The Nationalist People’s Coalition (NPC) was the minority party. However, the NPC later gained another
member after an independent candidate allied with them. The SP also had three ex-officio members from various
leagues.
N .
Subsequently, Juanitas left Lakas-CMD and joined NPC, followed by Vice Governor Cadiao, shifting the majority to NPC.
NPC proposed a resolutiuon, which aimed to reorganize the standing committees of the SP. This resolution, marked as
“urgent”. The resolution was passed with seven votes in favor (NPC) versus six against (Lakas-CMD). Consequently,
Piccio was replaced as the Majority Floor Leader by Juanitas.
The Lakas-CMD block petitioned the RTC, challenging the legality of the resolution on the grounds that a two-thirds vote
(nine votes) were required for urgent matters per the Internal Rules of Procedure (IRP) of the SP, and alternatively,
argued that at least a simple majority (eight votes) was necessary, interpreting the Vice Governor as part of the quorum.
The RTC ruled in favor of the respondents, holding that the Vice Governor’s presence should not be counted in the
majority vote calculation, thus validating the resolution passage with a 7-6 vote.
The Lakas-CMD block then appealed to the Supreme Court, which granted review.
ISSUE:
Whether or not the Local Government Code (LGC) and its Implementing Rules and Regulations (IRR) should govern the
voting requirements, which necessitated a majority of 8 votes from the 14-member body.
RULING:
Yes. Section 67 of the IRP of SP allows a majority vote to resolve issues unless explicitly stated otherwise. The
requirement for urgent matters being passed by a two-thirds vote as per SP’s Internal Rules of Procedure (IRP) cannot
surpass the statutory minimums laid out by the Local Government Code (LGC). Thus, a simple majority applied.
The Supreme Court acknowledged such executive opinions but held that legislative bodies cannot impose stricter
standards than the LGC. The LGC requirements took precedence. The Court likewise applied the relevant statutes,
determining that the SP’s resolution passage complied with statutory voting requirements. Vice Governor Cadiao’s vote
wasn’t essential for this legislative matter per Section 67, IRP of the SP and the LGC.
Pimentel vs. Aguire
G.R. No. 132988, July 19, 2000
PANGANIBAN, J.:
FACTS:
The case centers around Administrative Order No. 372 issued by President Fidel V. Ramos on December 27, 1997, as a
fiscal management measure to address the economic challenges posed by the peso’s depreciation. The order directed all
government agencies, including local government units (LGUs), to identify and implement measures to reduce their
expenditures by at least 25% of their authorized regular appropriations for non-personal services items. Further, Section
4 of AO 372 mandated the withholding of 10% of the internal revenue allotments (IRAs) due to LGUs, pending evaluation
by the Development Budget Coordinating Committee on the fiscal situation. This provision was later amended by
President Joseph Estrada through AO No. 43, reducing the withholding to 5% and ordering its release before December
25, 1998.
Subsequently, Senator Aquilino Pimentel Jr. filed a petition for Certiorari and Prohibition, challenging the legality of
specific sections of AO 372. The Supreme Court’s jurisdiction was invoked directly due to the significance and urgency of
the issues. The petitioner argued that President’s directives overstepped the constitutional limits of his supervisory
authority over LGUs and infringed upon the autonomy and fiscal independence guaranteed to them by the law,
particularly the Local Government Code and the Constitution.
ISSUE:
Whether the President, by issuing AO 372, exercised control rather than supervision over LGUs in violation of their fiscal
autonomy.
RULING:
YES. The Philippine Supreme Court held that while Section 1 of AO 372, which advised LGUs to reduce their expenditures
by 25%, was within the President’s supervisory powers and merely advisory in character, Section 4, which ordered the
withholding of a portion of the IRAs, was unconstitutional. The Court distinguished the power of supervision from the
power of control, finding that the President could not interfere with the autonomy of LGUs by withholding funds due to
them, as this action contravened the constitutional guarantee of automatic release of LGUs’ shares in the national
internal revenue.
The decision reiterates the doctrine that the President of the Philippines exercises general supervision, not control, over
local government units. Additionally, it underscores the principle of local autonomy, particularly in fiscal matters, against
unwarranted interference by the national government, ensuring the automatic release of LGUs’ shares in national taxes.
Casino v CA
G.R. No. 91192, Dec. 2, 1991
REGALADO, J.:
FACTS:
The case centers around Administrative Order No. 372 issued by President Fidel V. Ramos on December 27, 1997, as a
fiscal management measure to address the economic challenges posed by the peso’s depreciation. The order directed all
government agencies, including local government units (LGUs), to identify and implement measures to reduce their
expenditures by at least 25% of their authorized regular appropriations for non-personal services items. Further, Section
4 of AO 372 mandated the withholding of 10% of the internal revenue allotments (IRAs) due to LGUs, pending evaluation
by the Development Budget Coordinating Committee on the fiscal situation. This provision was later amended by
President Joseph Estrada through AO No. 43, reducing the withholding to 5% and ordering its release before December
25, 1998.
Subsequently, Senator Aquilino Pimentel Jr. filed a petition for Certiorari and Prohibition, challenging the legality of
specific sections of AO 372. The Supreme Court’s jurisdiction was invoked directly due to the significance and urgency of
the issues. The petitioner argued that President’s directives overstepped the constitutional limits of his supervisory
authority over LGUs and infringed upon the autonomy and fiscal independence guaranteed to them by the law,
particularly the Local Government Code and the Constitution.
ISSUE:
Whether the President, by issuing AO 372, exercised control rather than supervision over LGUs in violation of their fiscal
autonomy.
RULING:
YES. The Philippine Supreme Court held that while Section 1 of AO 372, which advised LGUs to reduce their expenditures
by 25%, was within the President’s supervisory powers and merely advisory in character, Section 4, which ordered the
withholding of a portion of the IRAs, was unconstitutional. The Court distinguished the power of supervision from the
power of control, finding that the President could not interfere with the autonomy of LGUs by withholding funds due to
them, as this action contravened the constitutional guarantee of automatic release of LGUs’ shares in the national
internal revenue.
The decision reiterates the doctrine that the President of the Philippines exercises general supervision, not control, over
local government units. Additionally, it underscores the principle of local autonomy, particularly in fiscal matters, against
unwarranted interference by the national government, ensuring the automatic release of LGUs’ shares in national taxes.
