Koronadal City v. Yellow Bus Lines
REITERATIONFacts
1. The Antecedents: The City of Koronadal became the Administrative Seat of Region XII on March 30, 2004. Subsequently, on August 1, 2008, its Sangguniang Panlungsod approved Ordinance No. 9, Series of 2018 (Ordinance), creating the City of Koronadal Integrated Transport Terminal Complex (CKITTC) to provide efficient transportation facilities, reduce traffic congestion and pollution, raise revenues, and promote general welfare. Yellow Bus Lines, Inc. (Yellow Bus), a duly franchised common carrier, operates its own private terminal along the national highway, which was accredited by the Land Transportation Franchising and Regulatory Board (LTFRB). Upon the Ordinance's implementation on October 16, 2018, Koronadal City et al. set up checkpoints, blocking Yellow Bus buses and rerouting them to the CKITTC, where they were required to pay a terminal fee of PHP 70.00 per entry. Yellow Bus alleged that this rerouting caused operational difficulties, vehicle damage due to narrow roads, and increased travel and dispatch times. 2. Procedural History: Yellow Bus filed a complaint for injunction with a preliminary prohibitory injunction and prayer for temporary restraining order against Koronadal City et al., arguing that the Ordinance's implementation violated its right to use its private terminal. The Regional Trial Court (RTC) granted Yellow Bus's motion for judgment on the pleadings, declaring the Ordinance's implementation premature and illegal as applied to Yellow Bus, and issued a writ of injunction. The RTC held that the Ordinance was not properly disseminated and that its wording, particularly Section 11, did not make the use of the CKITTC compulsory but only chargeable for those utilizing its services. Koronadal City et al.'s motion for reconsideration was denied by the RTC as pro forma. Koronadal City et al. then filed a Petition for Certiorari before the Court of Appeals (CA), which partially affirmed the RTC's ruling. The CA disagreed with the RTC's finding that the motion for reconsideration was pro forma but upheld the RTC's interpretation that the Ordinance did not mandate CKITTC use or prohibit private terminals, thus affirming that the forcible rerouting was not a legal exercise of police power. 3. The Petition: Koronadal City et al. filed a Petition for Review on Certiorari before the Supreme Court, arguing that Ordinance No. 9, Series of 2018, is a valid, mandatory law applicable to all public utility vehicles (PUVs), including Yellow Bus, citing Sections 4 and 5 of the Ordinance which define its scope and public utility vehicles. They contended that Koronadal City has the power to control and regulate traffic and terminals under the general welfare clause and Section 458(5)(v) and (vi) of the Local Government Code of 1991, and that excluding Yellow Bus would violate the equal protection clause. Petitioners also argued that the RTC erred in rendering a judgment on the pleadings because their Answer presented ostensible issues, and that Yellow Bus's failure to notify the Office of the Solicitor General (OSG) under Rule 63, Section 3 of the Rules of Court was fatal to its case.
Issue(s)
Whether the RTC's grant of judgment on the pleadings was proper. Whether the failure to give notice to the Office of the Solicitor General (OSG) was fatal to Yellow Bus Lines' case. Whether the Court of Appeals erred in affirming the RTC's grant of Yellow Bus Lines' Complaint for injunction.
Ruling
The Petition for Review on Certiorari is DENIED. The March 16, 2022 Decision and the November 15, 2022 Resolution of the Court of Appeals in CA-G.R. SP No. 09771-MIN are AFFIRMED. The Complaint for Injunction filed by respondent Yellow Bus Lines is GRANTED. A Writ of Injunction is issued enjoining petitioners City of Koronadal, the City Mayor, the City Treasurer, and the members of the City Transport Terminal Regulatory Board from blocking and rerouting the buses of Yellow Bus Lines and requiring it to use the City of Koronadal Integrated Transport Terminal Complex.
Ratio Decidendi
On Issue 1: The Supreme Court found that the Regional Trial Court's (RTC) judgment on the pleadings was proper. Rule 34, Section 1 of the Rules of Court states that judgment on the pleadings is appropriate if the answer fails to tender an issue or admits the material allegations of the adverse party's pleading. The Court, after reviewing Koronadal City et al.'s Answer, concluded that it practically admitted all the material allegations in Yellow Bus Lines' Complaint. The petitioners' arguments primarily focused on the validity and applicability of the Ordinance, rather than denying the factual claims made by Yellow Bus Lines regarding the rerouting and payment of fees. Therefore, the Answer failed to raise any genuine factual issues that would necessitate a full trial, making the RTC's decision to grant judgment on the pleadings correct. On Issue 2: The Court ruled that the failure to give notice to the Office of the Solicitor General (OSG) was not fatal to Yellow Bus Lines' case. Rule 63, Section 3 of the Rules of Court, which mandates OSG notification, specifically applies to petitions for declaratory relief and other similar remedies. Yellow Bus Lines' action was a complaint for injunction, not declaratory relief. Furthermore, a petition for declaratory relief is intended to secure an authoritative statement regarding rights and obligations before any breach or violation occurs. In this case, Yellow Bus Lines alleged actual blocking and rerouting of its buses, indicating an existing violation, which would render a petition for declaratory relief improper. On Issue 3: The Supreme Court affirmed the grant of injunction, finding that the two requisites for injunction were met: a right to be protected and acts violative of that right. Yellow Bus Lines' ownership of its private terminal necessarily includes the right to acquire, use, and dispose of it, a right protected by the Constitution. While Koronadal City et al. invoked police power under the general welfare clause and Section 458(5)(v) and (vi) of the Local Government Code of 1991 to regulate traffic and terminals, the Court reiterated that the exercise of police power must be reasonable and not unduly oppressive. Citing Lucena Grand Central Terminal, Inc. v. JAC Liner, Inc. and Metro Manila Development Authority v. Viron Transportation, Inc., the Court held that compelling public utility vehicles (PUVs) to use a public terminal and proscribing private ones is overbroad and disproportionate if not shown to be reasonably necessary and the least intrusive measure. Crucially, the Court found that Ordinance No. 9, Series of 2018, itself did not explicitly mandate the compulsory use of the City of Koronadal Integrated Transport Terminal Complex (CKITTC) or prohibit private terminals; its language only regulated the operation of the CKITTC and charged fees for those utilizing its services. Therefore, Koronadal City et al.'s actions of blocking and rerouting Yellow Bus Lines' buses were without legal basis and violated Yellow Bus Lines' property rights.
Main Doctrine
While local government units (LGUs) possess delegated police power to regulate traffic and establish terminals for public welfare, the exercise of such power must be reasonable and not unduly oppressive. An ordinance compelling public utility vehicles (PUVs) to use a public terminal and prohibiting private terminals, without a clear showing of reasonable necessity and less intrusive alternatives, constitutes an overbroad and disproportionate measure. Such an act violates property rights protected by the Constitution, especially when the ordinance itself does not explicitly mandate the compulsory use of the public terminal or prohibit private ones.