Chamber of Filipino Retailers, Inc. v. Villegas
REITERATIONFacts
The Antecedents: Petitioners questioned the legality of City Ordinance No. 6696, which raised market stall fees, arguing it was a source of revenue and thus beyond the City Charter's authorization to collect only 'fees' for supervision. While this case was pending, the Municipal Board approved Ordinance No. 6767, which lowered the fees from Ordinance No. 6696 but kept them higher than the old rates. Petitioners sought to prohibit the enforcement of Ordinance No. 6767. Procedural History: The Court of First Instance of Manila upheld the validity of Ordinance No. 6767. A restraining order was initially issued by the Executive Judge and later maintained by the Court after raffle, as its resolution would go into the merits of the case. The case was submitted on the pleadings. The Petition: Petitioners appealed the decision of the Court of First Instance, raising pure questions of law.
Issue(s)
Whether the enactment of Ordinance No. 6767 was an exercise of the governmental or proprietary function of the city. Whether the City of Manila can charge fees for the use of its public markets without the approval of the Public Service Commission.
Ruling
The appealed decision is affirmed, with costs against the petitioners-appellants.
Ratio Decidendi
On the issue of governmental vs. proprietary function: The Court held that even assuming, ad arguendo, that the City Charter only authorized the collection of fees sufficient for supervision, the subsequent enactment of Republic Act No. 2264 (Local Autonomy Act) broadened the city's authority. Section 2 of this Act grants chartered cities the power to impose municipal license taxes or fees upon persons engaged in occupation or business. Since selling in public markets constitutes an occupation or business, the city can now impose fees for revenue purposes, beyond mere reimbursement for supervisory services. Furthermore, the Court distinguished between the license to sell and the privilege of occupying a stall, which partakes of the nature of a lease of patrimonial property. The renting of city property is a proprietary function, allowing the city, like any private owner, to charge such fees as it deems best, with lessees free to accept or reject the terms. On the issue of Public Service Commission approval: The Court ruled that while a public market may be considered a public service or utility, it does not fall under the jurisdiction of the Public Service Commission as defined in Section 13(b) of the Public Service Act. The services enumerated in the Act are not ejusdem generis with public markets. Therefore, the approval of the Public Service Commission is not required for the City of Manila to fix fees for the use of its public markets, as this power is not covered by Section 20 of the Public Service Act.
Main Doctrine
The City of Manila, under the Local Autonomy Act, can impose fees on market vendors for revenue purposes, and the rental of market stalls constitutes a proprietary function, allowing the city to charge fees irrespective of supervisory costs.