CONSTITUTIONAL LAW II NOTES & DOCTRINES 1
SAN BEDA COLLEGE OF LAW - MANILA
CONSTITUTIONAL LAW II NOTES & DOCTRINES
THE INHERENT POWERS OF THE STATE:
POLICE POWER
GENERAL PRINCIPLES
o Police Power is the power of the State to promote public
welfare by restraining and regulating the use of liberty and
property (It is the most demanding of the three fundamental
powers of the State.)
Legal Maxims:
1. Salus populi est suprema lex (the welfare of the people is
the supreme law)
2. Sic utere tuo ut alienum non laedas (so use your property
so as not to injure the property of others)
o It could very well be synonymous with sovereign power.
o The police power is a grant from the people to their
governmental agents. It is not a delegated, but a reserved,
power.
o Police power is the power inherent in the state to prescribe,
within the limits of the Constitution, reasonable regulations
necessary to preserve the public order, health, safety, and
morals.
APPLICATION OF PRINCIPLES
Definition
o Police power grants a wide panoply of instruments through
which the State, as parents patriate gives effect to a host of
its regulatory powers.
o Its fundamental purpose is securing the general welfare,
comfort and convenience of the people.
o It is elastic and must be responsive to various social
conditions (Sangalang v. IAC)
On Franchise
o A franchise is not a strict sense a simple contract but rather
it is more importantly, a mere privilege specially in matters
which are within the government’s power to regulate and
even prohibit through the exercise of the police power.
Public office not subject to police power
o Although public office is not property under the
Constitution, Bill of Rights, Section 1, and one cannot
acquire a vested right to public office, it is, nevertheless, a
protected right. (Binay v. Domingo)
Mining Agreements
o Regardless of the reservation clause, mining leases or
agreements granted by the state are subject to alterations
through a reasonable exercise of the police power of the
state.
Municipal Corporations and Police Power
o Police power is inherent in the state but not in municipal
corporations. There must be a valid delegation of power by
the legislature which is the repository of the inherent powers
of the state.
o It is deemed inadvisable to attempt to frame any definition
which shall absolutely indicate the limits of police power.
o Operations of theater, cinematographs and other places of
public exhibition are subject to regulation by the municipal
council in the exercise of delegated police power by the local
government. (Balacuit v. Court of First Instance of Agusan
del Norte)
o Means adopted must be reasonably necessary for the
accomplishment of the purpose and not unduly oppressive
upon individuals.
o The determination as to what is a proper exercise of its police
power is not final or conclusive but is subject to the
supervision of the courts.
o This power can be activated at any time to change the
provisions of the contract, or even abrogate it entirely, for
the promotion or protection of the general welfare.
Public Purpose
o The support for the poor has long been accepted exercise of
police power in the promotion of the common good.
Legislation based on police power
o Legislative act based on police power requires the
concurrence of a lawful subject and a lawful method.
(National Development Company v. Philippine Veterans
Bank)
Private Property
o Private property cannot simply be taken by law from one
person and given to another without compensation and any
known public purpose.
o Regulatory ordinance must be reasonable, and its provisions
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cannot be oppressive amounting an arbitrary interference
with the business or calling subject of regulation.
Police power vs. Impairment Clause
o The superiority of police power will apply only where the
contract is so related to the public welfare that it will be
considered congenitally susceptible to change by the
legislature in the interest of the greater number.
Regulating the practice of profession
o That the power to regulate and control the practice of
medicine includes the power to regulate admission to the
ranks of those authorized to practice medicine. (Tablarin v.
Gutierrez)
NATURE AND DEFINITION
o On contracts: The freedom to contract is not absolute; all
contracts and all rights are subject to the police power of the
State and not only may regulations which affect them be
established by the State, but all such regulations must be
subject to change from time to time, as the general well-
being of the community may require, or as the circumstances
may change, or as experience may demonstrate the
necessity. (Goldenway Merchandizing Corporation v.
Equitable PCI Bank)
o On PAGCOR: It is a reliable source of much needed revenue
for the cash strapped Government. It provided funds for
social impact projects and subjected gambling to “close
scrutiny, regulation, supervision and control of the
Government” (Basco v. Pagcor)

o The term “police power” has never been, and we do not
believe can be, clearly and circumscribed. The definition
must depend upon the particular law and the particular facts
to which it is to be applied.
o Eight Distinct Branches:
1. Police for the prevention of offenses
2. Police for the prevention of calamities
3. Police for the prevention of endemic diseases
4. Police of charity
5. Police of interior communications
6. Police of public amusements
7. Police for recent intelligence
8. Police for registration
(People v. Pomar)
o Power of Taxation – The individual receives the equivalent
of the tax in the form of protection and benefit he receives
from the government as such.
o Power of Eminent Domain – He receives the market value
of the property taken from him.
o Police Power – The benefits he derived are only such a may
arise from the maintenance of a healthy economic standard
of society and is often referred to as damnum absque injuria.
o Unsightly advertisement or signs, signboards, or billboards
which are offensive to the sight, are not disassociated from
the general welfare of the public. (Churchill v. Rafferty)
REGULATORY PURPOSE
o On gambling: The morality of gambling is not a justiciable
issue. The legislature may prohibit gambling altogether or
allow it without limitation or it may prohibit some forms of
gambling and allow others for whatever reasons it may
consider sufficient. (Lim v. Paquing)
Reason: There is nothing in the Constitution categorically
proscribing or penalizing gambling.
o The Stabilization Fund is to be utilized for the benefit of the
entire sugar industry, “and all its components, stabilization
of domestic market including foreign market.” The industry
being of vital importance to the country’s economy and to
national interest. (Gaston v. Republic Planters Bank)
o The Police Power is distinct from the Power of Eminent
Domain, as follows:
1. Under police power, as a rule no compensation is
required.
2. Under police power, there is no transfer of ownership,
but rather a destruction of property or an impairment of
its value.
3. Under police power, the taking is not for public use, but
for the conservation of the safety, morals, health, and
general welfare of the public.
4. The essence of the police power is that it continues to
operate even if it might result in a deprivation of
individual rights and property, unlike eminent domain.
o The delegation of police power embodied in the Local
Government Code of 1991 (RA No. 7160), Section 16
known as the General Welfare Clause has two branches:
First, known as the general legislative power,
authorizes the municipal council to enact
ordinances and make regulations not repugnant to
law, as may be necessary ordinances and make
regulations not repugnant to law, as may be
CONSTITUTIONAL LAW II NOTES & DOCTRINES 2
necessary to carry into effect and discharge the
powers and duties conferred upon the municipal
council by law.
Second, known as the police power proper,
authorizes the municipality to enact ordinances as
may be necessary and proper for the health and
safety, prosperity, morals, peace, good order,
comfort, and convenience of the municipality and
its inhabitants, ad for the protection of their
property.
o Two Tests of Valid Exercise of Police Power by
Ordinances: (Fernando v. St. Scholastica’s College)
We ourselves have applied the rational basis test
mainly in analysis of equal protection challenges.
Using the rational basis examination, laws and
ordinances are upheld if they rationally further a
legitimate governmental interest. Under
intermediate review, governmental interest is
extensively examined and the availability of less
restrictive meaures is considered. Applying strict
scrutiny, the focus is on the presence of
compelling, rather than substantial, governmental
interest and on the absence of less restrictive
means for achieving that interest.
Requisites under rational relationship test:
(1) The interests of the public generally, as
distinguished from those of a particular
class, require its exercise; and
(2) The means employed are reasonable
necessary for the accomplishment of the
purpose and not unduly oppressive upon
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individuals.
In short, a combination of lawful subject
and lawful method.
o The State may not, under the guise of police power,
permanently divest owners of the beneficial use of
their property solely to preserve or enhance the
aesthetic appearance of the community.
o The power to regulate, however, does not include the
power to prohibit. A fortiorari, the power to regulate
does not include the power to confiscate.
o When there is a taking or confiscation of private
property for public use, the State is no longer
exercising police power, but the power of eminent
domain.
o A regulation that deprives any person of the
profitable use of his property constitutes a taking and
entitles him to compensation, unless the invasion of
rights is so slight as to permit the regulation to be
justified under the police power. (OSG v. Ayala Land,
Inc.)
o A police measure for the regulation of the conduct,
control and operation of a business should not
encroach upon the legitimate and lawful exercise by
the citizens of their property rights.
o The proprietors of a theater have a right to manage
their property in their own way, to fix what prices of
admission they think most for their own advantage,
and any person who did not approve could stay away.
(Balacuit v. Court of First Instance)

o The police power is also distinct from taxation, as
follows:
1. Police power is exercised for the promotion of
the public welfare by means of the regulation of
dangerous or potentially dangerous business,
occupations, or activities. By comparison, the
taxing power is exercised for the purpose of
raising revenues.
2. While taxation is subject to certain designated
constitutional limitations, the police power is
not subject to the same constitutional limitation.
3. The primary purpose of the police power is the
regulation of some particular occupation,
calling, or activity, even if it incidentally
produces revenue. The primary purpose of
taxation is to raise revenue.
Police power and the power of taxation are inherent
powers of the State. These powers are distinct and
have different tests for validity. Police Power is the
power of the State to enact legislation that may
interfere with personal liberty or property in order
to promote the general welfare, while the power of
taxation is the power to levy taxes to be used for
public purpose. The main purpose of police power
is the regulation of a behavior or conduct, while
taxation is revenue generation. The “lawful
subjects” and “lawful means” tests are used to
determine the validity of the law enacted under the
police power. The power of taxation, on the other
hand, is circumscribed by inherent and
constitutional limitations. (Planters Product, Inc.
v. Fertiphil Corporation)
War Power
o The war power and the police power are similar, but the
war power is the police power raised to the highest degree.
Law of Necessity – the police power is coextensive with the
necessities of the case and the safeguards of public interest. The
police power is the power of self-protection on the part of the
community. It bears the same relation to the community that the
principle of self-defense bears to the individual.
Doctrine: Police power is based on public necessity
Emergencies
o The general rule is that emergency does not create power,
increase granted power, or remove or diminish the
restrictions imposed upon power granted or reserved.
o Emergency may furnish the occasion for the exercise of
police power.
o Two main characteristics of Police Power
1. Flexibility – the tendency is to extend than to restrict power
during changing conditions of the society. The power itself
does not expand, but is of such a nature in its original scope
as to correct new evils as they arise. Police power is of such
elasticity that the principle of stare decisis does not apply
to its exercise. The courts cannot decide away that which
the state itself cannot contract away.
2. Inalienability – the State cannot barter or bargain away the
right to use the police power. It cannot divest itself of the
power to provide for acknowledged objects of legislation
falling within the domain of the police power.
CONSTITUTIONAL LAW II NOTES & DOCTRINES 3
LIMITATIONS ON POLICE POWER
General Limitations:
1. Constitutional Limitations specially the Bill of Rights
2. Territorial limitations
3. Police legislation
a. Must have a purpose falling within the scope of the
police power
b. Must be reasonable
c. Must provide for means that are appropriate
4. By its nature, police power is exercisable only restrictively,
restrictions being implicit in the power itself.
Requirement of Reasonableness
1. The law must be based on reason, as distinct from being
arbitrary or capricious
2. The scope of the term “reasonable” must be measured,
having regard to the fundamental principles of human
liberty as understood at the time of the formation of the
constitution, adopting them to modern conditions; and
having regard to established customs.
3. Must be measured largely by public need
4. “reasonableness” is not synonymous with “expediency.”
The former is subject to judicial inquiry, while the latter is
wholly of congressional cognizance.
5. Must be considered in the light of current economic
conditions
6. It depends upon the character or nature of the condition to
be remedied.
7. Fairly debatable test: if a court is convinced that the object
of a regulation is one which reasonable persons could find
fairly debatable as to reasonableness, the regulation will be
upheld.
8. The test is whether in its attempted regulation the law
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makes efficient constitutional guaranties and conserves
rights, or is destructive of inherent rights.
9. The regulation must tend to some ulterior good to which the
destruction of liberty is merely incidental.
o In the exercise of police power, property rights of
individuals may be subjected to restraints and burdens in
order to fulfill the objectives of the government. (Social
Justice Society v. Atienza)
o On radio and television air time: Radio and television
broadcasting companies, which are given franchises [SEE
ON FRANCHISE, page 01], do not own the airwaves and
frequencies through which they transmit broadcast signals
and images. They are merely given the temporary privilege
of using them. Since a franchise is a mere privilege, the
exercise of the privilege may reasonably be burdened with
the performance by the grantee of some form of public
service. (Telebap v. Commission on Elections)
o On medicine: The prohibition against the use by doctors of
“no substitution” and/or words of similar import in their
prescription, is a valid regulation to prevent the
circumvention of the law. It secures to the patient the right
to choose between the brand names and its generic
equivalent since his doctor is allowed to write both the
generic and the brand name in his prescription form.
Reason: Generic is cheaper but has the same effect
(Del Rosario v. Bengzon)

o The public purpose of tax may legally exist even if the
motive which impelled the legislature to impose the tax was
to favor one industry over another. It is inherent in the
power to tax that a state be free to select the subjects of
taxation, and it has been repeatedly held that “inequities
which result from a singling out of one particular class for
taxation or exemption infringe no constitutional
limitation.” Taxation has been made the implement of the
state’s police power. (Tio v. Videogram Regulatory Board)
o To assure that the general welfare be promoted, which is the
end of law, a regulatory measure may cut into the rights to
liberty and property. Those adversely affected may under
such circumstances invoke the equal protection clause only
if they can show that the governmental act assailed, far from
being inspired by the attainment of the common weal was
prompted by the spirit of hostility, or at the very least,
discrimination that finds no support in reason.
Principle: Equal protection and security shall be given to
every person under circumstances, which if not identical are
analogous. (Bautista v. Juinio)
Requirement of Appropriate Means
It is a general rule that in order for a police measure to be reasonable,
the means adopted must be reasonably necessary and appropriate for
the accomplishment of the legitimate objects falling within the scope
of the power.
o The true role of Constitutional Law is to effect an
equilibrium between authority and liberty so that rights are
exercised within the framework of the law and the laws are
enacted with due deference to rights.
o Whether an ordinance is effective is an issue different from
whether it is reasonably necessary. It is its reasonableness,
not its effectiveness, which bears upon its constitutionality.
If the constitutionality of a law were measured by its
effectiveness, then even tyrannical laws may be justified
whenever they happen to be effective.
o In view of the requirements of due process, equal protection
and other applicable constitutional guaranties, however, the
exercise of such police power insofar as it may affect the life,
liberty or property of any person is subject to judicial
inquiry. Where such exercise of police power may be
considered as either capricious, whimsical, unjust or
unreasonable, a denial of due process or a violation of any
other applicable constitutional guaranty may call for
correction by the courts. (Ermita Motel Operators
Associations, Inc. v. Manila Mayor)
o On leprosy: judicial notice will be taken of the fact that
leprosy is commonly believed to be an infectious disease
tending to cause one afflicted with it to be shunned and
excluded from society, and that compulsory segregation of
lepers as a means of preventing the spread of the disease is
supported by high scientific authority. (Lorenzo v. Director
of Health)
o On carabaos: The police power rests upon necessity and the
right of self-protection, and if ever the invasion of private
property by police regulation can be justified, we think that
the reasonable restriction placed upon the use of carabaos by
the provision of the law under discussion must be held to be
authorized as a reasonable and proper exercise of police
power.
CONSTITUTIONAL LAW II NOTES & DOCTRINES 4
Reason: To protect the community from the loss of the
services of such animals by their slaughter by improvident
owners, tempted either by greed of momentary gain, or by
desire to enjoy the luxury of animal food (US v. Toribio)
POWER AND DISCRETION OF CONGRESS
o A mere assertion by Congress that a law relates to the public
health, safety, or welfare does not of itself bring such law
within the police power. It is the duty of the courts to
determine whether the exercise of power is really necessary
for the public good.
o The presumption is always in favor of the validity of a law
passed in the exercise of a police power.
Questions to which judicial inquiry may extend:
o Whether the law is actually within the police power
o Whether the power has been exercised with the proper
limitations
o Whether the facts of a particular case warrant the assertion
of the power
o Whether a law is reasonable or arbitrary
o Whether a particular law is designed to further some
governmental function or private gain
o What are subjects of the lawful exercise of the police power
o Whether an act bears any reasonable and substantial relation
to the public purpose sought to be accomplished
o The Court does not substitute its social and economic belief
for the judgment of Congress, whose members are elected to
pass laws.
o Indeed, no right is absolute, and the proper regulation of a
profession, business or trade has always been upheld as a
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legitimate subject of a valid exercise of the police power of
the State particularly when their conduct affects the
execution of legitimate governmental functions, the
preservation of the State, public health and welfare and
public morals. (Remman Enterprises, Inc. v. Professional
Regulatory Board of Real Estate Service)
CONSTITUTIONAL LIMITATIONS ON POLICE POWER
o Police power regulations cannot arbitrarily interfere with the
enjoyment of rights guaranteed by the Constitution. But an
alleged invasion of constitutional rights cannot be used as an
excuse for lightly setting aside laws enacted to further the
common good.
o A police regulation is not rendered invalid by the fact that it
may affect incidentally the exercise of some constitutional
right.
o The rights of the individual are subordinate to the welfare of
the general public.
LIMITATIONS BY PARTICULAR CONSTITUTIONAL
PROVISIONS
1. Due Process Clause
o The balance between police powers and due process is more
or less a state of unstable equilibrium changing with
sociological and economic development.
o The due process clause is a limitation upon an improper
exercise of the police power of the State.
o The due process clause prevents an arbitrary or unreasonable
exercise of police power.
Procedural Due Process refers to the procedure that the government
must follow before it deprives a person of life, liberty, or property.

Substantive Due Process completes protection envisioned by the due
process clause. It inquires whether the government has sufficient
justification for depriving a person of life, liberty, or property.
o The guaranty serves as a protection against arbitrary
regulation, and private corporations and partnerships are
“persons” within the scope of the guarantee insofar as their
property is concerned. (City of Manila v. Laguio)
2. Private Property Rights
o All property rights are held subject to reasonable police
regulations so that the rights of the general public may be
protected.
Public Interest now extends to: (in upholding police legislation as
valid)
o Attracting a desirable citizenship to a particular locality of a
municipality, and assuring its permanency
o Fostering pride in, and attachment to, the city
o Promoting happiness and contentment
o Stabilizing the use and value of money
o Promoting the public tranquility and good order of the city
o Restrictions on the uses to which real property may be put
o Limitations on the types of structures which may be erected
on premises in certain localities
o Groupings in definite localities of the enterprises which may
be carried on as real property
o A determination by Congress that the community should be
beautiful as well as healthy, spacious as well as clean, well-
balanced as well as carefully patrolled. The values
represented by the public welfare are spiritual as well as
physical, aesthetic as well as monetary
In addition to aesthetic purposes, a public need or purpose should be
shown to sustain police regulation relating to the following:
o Housing regulations
o Regulations on outdoor advertising
o Buildings
o Automobile-wrecking plants
o Public garages
o Cemeteries
o The State may not, under the guise of police power,
permanently divest owners of the beneficial use of their
property solely to preserve or enhance the aesthetic
appearance of the community.
3. Equal Protection Clause
o Police power cannot be invoked to protect one class of
citizens against another class, unless such interference is for
the real protection of society in general.
o Under its police power, the Congress may pass laws that
are not all-embracing, in a classified regulatory enactment
with reference to degrees of evil and to the location where
the evil is most harmful, without denying the equal
protection of the laws.
4. Non-Impairment Clause
o Section 10, Article III of the 1987 Constitution provides that
no law impairing the obligation of contracts shall be passed.
However, the right to contract is subject to certain limitations
which the State may lawfully impose in the exercise of its
police power.
o The legitimate exercise of the police power cannot constitute
an impairment of contract, and reasonable regulation under
CONSTITUTIONAL LAW II NOTES & DOCTRINES 5
the police power may include the alteration or modification
of remedies in force at the time a contract is entered into.
o A law passed in the legitimate exercise of the police power
will be upheld by the courts, although it incidentally destroys
existing contract rights.
o The authority of Congress, in the exercise of its police power,
cannot be limited by the provisions of private contracts.
Factors indicating the reasonableness and necessity of police power
measures impairing private contracts:
1. If the alteration of contractual obligations is minimal, there
is no violation of the contract clause.
2. Existence of an emergency
3. Clear intent of a law to protect a basic interest of society, as
opposed to the special interests of individuals or groups.
4. The law merely affects contractual remedies.
5. The law operates exclusively upon subsequent contracts,
rather than preexisting agreements.
6. The law does not actually diminish rights or increase duties
under the contract.
7. The validates theretofore void or voidable private contracts,
or limits private parties to the benefit of their original
bargains.
o The contract clause is not an absolute bar to subsequent
modification of a State’s own financial obligations. An
impairment may be constitutional if it is reasonable and
necessary to serve an important public purpose.
o State’s exercise of police powers may prevail over
obligations imposed by private contracts. In reference to
Section 28 of Jones Law:
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No franchise or right shall be granted to any
individual, firm, or corporation except under
the conditions that it shall be subject to
amendment, alteration, or repeal by the
Congress of the United States, and that lands or
right of use and occupation of lands thus
granted shall revert to the government by which
they were respectively granted upon the
termination of the franchises and rights under
which they were granted or upon their
revocation or repeal. (Hospicio De San Jose De
Barili, Cebu City v. Agrarian Reform)
5. Just Compensation Clause
o Section 9, Article III of the 1987 Constitution provides:
“Private property shall not be taken for public use without
just compensation.”
o This just compensation clause is not necessarily violated
when a police law prevents the enjoyment of certain
individual rights in property, without providing
compensation.
Principle: Such laws are not considered as appropriating
private property for public use but simply as regulating its
use and enjoyment by the owner.
Reason behind the principle: If the owner suffers injury,
it is damnum absque injuria (a loss or injury which does
not give rise to an action for damages against the person
causing it).
Alternative Theory: The owner is compensated for it by
sharing in the general benefits which the laws are intended
and calculated to secure.

Tests for Just Compensation
1. No Compensation – if the law makes an exclusive
reference to the police power of the State, without any
purpose to take and apply property to public use.
2. Compensation – if the law not only declares the existence
of a nuisance created by the condition of particular
property, but in addition, and as the best means of
accomplishing the end in view, authorizes the same
property to be appropriated by the public.
Rule: If the law goes too far, it will be considered as taking.
o There is taking when private, personal, and property rights
are interfered with, injured, or impaired in a manner, by a
means, or to an extent that is not reasonably necessary, to
serve a public purpose for the general welfare.
6. Freedoms of Speech, Press, Religion, and Assembly
o The State may punish those who abuse the constitutional
freedom of speech by utterances inimical to public welfare,
tending to corrupt public morals, incite to crime, or disturb
the public peace.
o The freedom to assemble peaceably and to petition the
government, like the freedoms of speech, press, and
religion, is also subject to reasonable regulation to protect
the general welfare.
Example: law imposing curfew – Its constitutionality will
depend in each case on reasonableness, necessity, and
purpose.
o Maximum tolerance is for the protection and benefit of all
rallyists and is independent of the content of the
expressions in the rally.
o Not every expression of opinion is a public assembly. The
law [B.P. 880 or “Public Assembly Act of 1985] refers to
“rally, demonstration, march, parade, procession or any
other form of mass or concerted action held in a public
place. It also regulates the exercise of the right to peaceful
assembly and petition to the extent needed to avoid a clear
and present danger of the substantive evils Congress has the
right to prevent.
o The delegation to the mayors of the power to issue rally
“permits” is valid because it is subject to the
constitutionally-sound “clear and present danger” standard.
(Bayan v. Ermita)
7. Freedom of Religion
o The freedom of religion may properly be limited by
Congress to times, places, and methods, provided that such
limitations are not odds with the preservation of peace and
good order, in view of existing social and economic
conditions.
o OMA (Office of the Muslim Affairs) was created “to ensure
the integration of Muslim Filipinos into the mainstream of
Filipino society with due regard to their beliefs, customs,
traditions, and institutions.” OMA deals with the societal,
legal, political and economic concerns of the Muslim
community as a “national cultural community” and not as
a religious group. Thus, the State must make sure that OMA
does not intrude into purely religious matters.
o Only the prevention of an immediate and grave danger to the
security and welfare of the community can justify the
infringement of religious freedom. (Islamic Da’wah Council
of the Philippines, Inc. v. Office of the Executive Secretary)
CONSTITUTIONAL LAW II NOTES & DOCTRINES 6
o The Constitution embraces two concepts:
1. Freedom to believe – absolute. Conduct remains
subject to regulation for the protection of society.
2. Freedom to act – must have appropriate definitions to
preserve the enforcement of that protection.
o Solicitation for religious purposes may be subject to proper
regulation by the State in the exercise of police power.
Without a doubt, a State may protect its citizens from
fraudulent solicitation by requiring a stranger in the
community, before permitting him publicly to solicit funds
for any purpose, to establish his identity and his authority to
act for the cause which he purports to represent. (Centeno v.
Villalon-Pornillos)
8. Other Constitutional Limitations
1. Bill of attainder
2. Ex post facto laws
3. Unreasonable searches and seizures
4. General welfare clause
SCOPE OF POLICE POWER
General Scope of Police Power:
1. Protection of lives, health, and property of the citizens
2. Preservation of good order
3. Preservation of public morals
4. Restraint and punishment of crime
5. Preservation of the general welfare of the community
6. Pursuit of public good
7. Protection of the public health, safety and morals
8. Securing the public peace, good order, health, safety, morals
and general welfare
9. Protection of the lives, limbs, health, comfort and quiet of all
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persons and the protection of all property within the state,
including public property
10. Promotion of the comfort and welfare of the society
11. Promotion of the public health, safety, morals, convenience,
or general welfare, or the prevention of fraud, immorality, or
oppression
o Today, police power is applied liberally and even indirectly
Reason: continuous change in economic and social
conditions
General Welfare
General Welfare extends to the following:
o Establishment of a system of unemployment insurance taxes
o Welfare programs for needy and indigent persons
o The institution before the advent of widespread
unemployment of a scheme of public works designed to
combat such unemployment if it occurs
o Primary social interest of safety, order, and morals,
economic interests, and nonmaterial and political interests
o On the 20% discount to senior citizens: The Court is not
oblivious of the retail side of the pharmaceutical industry and
the competitive pricing component of the business. While
the constitution protects property rights, petitioners must
accept the realities of business and the State, in the exercise
of police power, can intervene in the operations of a business
which may result in an impairment of property rights in the
process. (Carlos Superdrug Corp. v. DSWD)

o On OFWs: To pretend that licensing or accreditation
requirements violates the due process clause is to ignore the
settled practice, under the mantle of the police power, of
regulating entry to the practice of various trades or
professions. Professionals leaving for abroad are required to
pass rigid written and practical exams before they are
deemed fit to practice their trade. (JMM Promotion and
Management, Inc. v. Court of Appeals)
Physical Welfare; Public Health and Safety
Sample laws in relation to this:
o Inspection and quarantine regulations in reference to goods,
freight, animals, and livestock;
o Summary seizure of mislabeled drugs;
o Destroying spoiled foodstuff; and
o A ban on smoking in close and confined places, such as
theaters, public conveyances, air carriers, and restaurants.
However, an absolute prohibition of smoking in streets,
parks, or other public places or anywhere within the
corporate limits of a municipality would be unreasonably
broad and unconstitutional. The purpose should be to prevent
fire or explosion, or to protect the health and general physical
well-being of other non-smoking persons in the area.
o The promotion of public health is a fundamental obligation
of the State. The health of the people is a primordial
governmental concern. Basically, the National Blood
Services Act (for the improvement of Philippine blood
banking system and phasing out of commercial blood banks
to prevent infected blood donations) was enacted in the
exercise of the State’s police power in order to promote and
preserve public health and safety. (Beltran v. Secretary of
Health)
Public Morals
Police power may be used to regulate the following:
o Gambling;
o Prostitution; and
o Lewdness, indecency, and obscenity.
o The power to define crimes and prescribe their
corresponding penalties is legislative in nature and inherent
in the sovereign power of the state to maintain social order
as an aspect of police power. (People v. Siton)
Void-for-Vagueness Doctrine
A statute which either forbids or requires the doing of an act in terms
so vague that men of common intelligence must necessarily guess its
meaning and differ as to its application, violates the first essential of
due process of law.
o In exercise police power to declare what acts constitute a
crime, the legislature must inform the citizen with reasonable
precision what acts it intends to prohibit so that he may have
a certain understandable rule of conduct and know what acts
it is his duty to avoid.
Public Peace, Good Order, and Comfort
The police power covers the following:
o Securing the peace, good order, dignity, protection, ad
comfort of the community
o Promotion of domestic tranquility, and the comfort and
quiet of all persons; and
o Prevention of questionable conduct which, if permitted to
be committed untrammeled, would seriously disrupt the
public peace.
CONSTITUTIONAL LAW II NOTES & DOCTRINES 7
o According to Justice Malcolm: “The word ‘regulate’ as used
in Subsection (1), Section 2444 of the Administrative Code,
means and includes the power to control, to govern, and to
restrain; but ‘regulate’ should not be construed as
synonymous with ‘suppress’ or ‘prohibit.’”
o On admission ticket: Insofar as movie houses and other
places of amusement are concerned, the least doubt cannot
be entertained as to the validity of a measure prohibiting a
proprietor, lessee or operator of an amusement place to admit
two or more persons with only one ticket, not only in the
interest of preventing fraud insofar as municipal taxes are
concerned, but also in accordance with public health, public
safety and the general welfare. (Samson v. Mayor of Bacolod
City)
Economic Welfare
Police power extends to the following laws:
o Laws to increase the industries of the State, develop its
resources, and add to its welfare and prosperity
o Laws enforcing a particular economic policy reasonably
deemed to promote public welfare
o Laws to promote aesthetics directly related to the general
economy, or the preservation of natural scenic beauty to
promote the tourist industry
o Laws protecting the public from financial loss
o The control and regulation of trade in the interest of the
public welfare is of course an exercise of the police power of
the State.
o On self-reliant and independent national economy (see RA
No. 8762 and Article 12 of the 1987 PH Constitution): Thus,
while the Constitution mandates a bias in favor of Filipino
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good, services, labor and enterprises, it also recognizes the
need for business exchange with the rest of the world on the
bases of equality and reciprocity, frowning only on foreign
competition that is unfair. (Espina v. Zamora)
o On natural resources: The economic policy on the
exploration, development and utilization of the country’s
natural resources under the 1987 Philippine Constitution,
Article 12, Section 2 could not be any clearer. As enunciated
in the 1987 Constitution, Article 12, Section 1, the
exploration, development and utilization of natural resources
under the new system mandated in Section 2, is geared
towards a more equitable distribution of opportunities,
income and wealth; a sustained increase in the amount of
goods and services produced by the nation for the benefit of
the people; and an expanding productivity as the key raising
the quality of life for all, especially the underprivileged.
o On mining leases and agreements: The State, in the exercise
of its police power in this regard, may not be precluded by
the constitutional restriction on non-impairment of contract
from altering, modifying and amending the mining leases or
agreements granted under P.D. No. 463, as amended,
pursuant to E.O. No. 211. (Miners Association of the
Philippines, Inc. v. Factoran)
o On bouncing checks
The ‘check flasher’ does a great deal more than
contract a debt; he shakes the pillars of
business; and to my mind, it is a mistaken
charity of judgment to place him in the same
category with the honest man who is unable to
pay his debts, and for whom the constitutional

inhibition against imprisonment for debt,
except in cases of fraud was intended as a shield
and not a sword. (Lozano v. Martinez)
Protection of Environment
Police power extends to regulations of:
o Air and water pollution control programs
o Restoration of land surfaces following strip, open-pit, and
other similar methods of surface mining; and
o Remedies for inadequate systems of sewage disposal
o Laws pertaining to the protection of the environment were
not drafted in a vacuum. Congress passed these laws fully
aware of the perilous state of both our economic and natural
wealth. It was precisely to minimize that adverse impact of
humanity’s actions on all aspects of the natural world, at the
same time maintaining and ensuring an environment under
which man and nature can thrive in productive and
enjoyable harmony with each other, that these legal
safeguards were put in place. (Province of Rizal v.
Executive Secretary)
Conservation of Natural Resources
Police Power may be reasonably used to protect and conserve:
o Gas and oil operations
o Mining operations
o Forests and forest lands
o Water resources
o Fish resources
Prevention of Fraud
The Police Power extends to the following:
o Laws governing the issuance and sale of securities, also
known as “blue sky laws”
o Laws regulating sales of personal property in general
o Laws regulating sales of land
o Laws to prevent false or misleading advertisements
o Laws relating to the manufacture and sale of food
o Laws regulating and controlling weights and measures
o On receipts: Ordinance No. 532 was enacted to avoid
disputes between laundrymen and their patrons and to
protect customers of laundries who are not able to decipher
Chinese characters from being defrauded. The convenience
of the public would also presumably be served in a
community where there is a Babel of tongues by having
receipts made out in two official languages.
Regulation of Businesses, Occupations, and Professions
o Police power extends to any “business affected with a
public interest.”
o The meaning of “business affected with a public interest”:
a. Property becomes clothed with a public interest when
used in a manner to make it of public consequence and
offset the community at large.
b. The circumstances must be such as to create a
peculiarly close relationship between the public and
those engaged in the business, and raise implications
of affirmative obligations on their part to be
reasonable in dealing with the public. It means more
than that the public welfare is affected by its continuity
or by the price at which a commodity is sold or a
service rendered.
c. It means only that an industry, for adequate reason, is
subject to control for the public good.
CONSTITUTIONAL LAW II NOTES & DOCTRINES 8
d. Equivalent of the term “subject to the exercise of the
police power.”
Three Classes of “business affected with a public interest”
1. Those carried under a public grant of privileges
2. Certain occupations regarded as exceptional, such as the
keeping of hotels and taxicabs
3. Businesses the owners of which, by devoting them to public
use, in effect grant the public an interest in that use and
subject themselves to public regulations to the extent of that
interest
Modes of Regulation
1. Prohibition. This applied when a calling is inherently
injurious or the pursuit of the calling has the effect on public
welfare. Prohibition may apply to:
a. Manufacture or sale of cigarettes
b. Radio-TV advertising of cigarettes
c. Advertising laws on the subjects of venereal diseases,
prescription drugs, and the like
2. Fixing terms, conditions, and restrictions
a. To obtain a franchise, license, or permit
b. To deposit certain sums of money
c. Posting the fidelity, indemnity, or performance bonds
d. Establishment of an accident or insurance fund for
employees
e. Requiring persons engaged in particular professions to
make reports to government officials, or to be
fingerprinted
f. Restricting the production and marketing of
agricultural commodities to allotted quantities, in
order to prevent waste and secure stability of markets.
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3. Restriction to qualified professions. Police power
justifies board or bar examinations, and diploma or license
requirements. It also justifies the prohibition of a certain
occupation or business by one who has past criminal record.
(SEE Tablarin v. Gutierrez & DECS v. San Diego)
4. Restrictions as to place. These are justified by noise,
odors, or dangers which disturb the general welfare.
5. Restrictions as to time. Police power justifies laws
limiting and regulating hours of labor, as well as Sunday
laws.
6. Restrictions as to price. The State may regulate a business
in any of its aspects, including the prices to be charged for
the products or commodities it sells. Hence, the private
character of a business does not necessarily exempt it from
the regulation of prices by State.
The State may promote free competition by laws
aimed at monopolies, or by curbing harmful competition by
fixing minimum prices.
When unconstitutional: When arbitrary, discriminatory, or
demonstrably irrelevant
7. Imposing liabilities. Police power justifies the imposition
of liability without fault in various civil matters, as well as
the creation of strict liability criminal offenses.
REFERENCE
 Constitutional Law Text and Cases (Bill of Rights) by
Miriam Defensor Santiago (2016)

THE INHERENT POWERS OF THE STATE:
POWER OF EMINENT DOMAIN
Section 9, Article III of the 1987 Philippine Constitution provides:
“Private property shall not be taken for
public use without just compensation.”
o Expropriation or the exercise of the State’s right to eminent
domain is proscribed by the restraints of public use and just
compensation. It is governed by Rules of Court, Section 67
which presents procedural guidelines for the court to ensure
that due process is observed and just compensation rightly
paid to the private owners.
o The state must first establish that the exercise of eminent
domain is for a public purpose. What remains to be
determined is the just compensation.
o Governed by the Rules of Court, Rule 67, the proceedings
therefor consist of two stages:
a. The condemnation of the property after it is
determined that its acquisition will be for a public
purpose or public use; and
b. The determination of juts compensation to be paid for
the taking of private property to be made by the court
with the assistance of not more than three
commissioners.
o The nature and character of the land at the time of its taking
is the principal criterion to determine just compensation to
the landowner.
o An ejectment suit ordinarily should not prevail over the
State’s power of eminent domain.
o The power of eminent domain is lodged in the legislative
branch of government, which may delegate its exercise to
local government units, other public entities and public
utilities.
o The basis for the exercise of eminent domain is necessity.
REQUISITES FOR LOCAL GOVERNMENT UNITS
The following essential requisites must concur before a local
government unit can exercise the power of eminent domain:
1. An ordinance is enacted by local legislative council
authorizing the local chief executive, in behalf of the local
government unit, to exercise the power of eminent domain
or pursue expropriation proceedings;
2. The power of eminent domain is exercised for public use,
purpose, or welfare;
3. There is a payment of just compensation;
4. A valid and definite offer has been previously made to the
owner of the property sought to be expropriated, but said
offer was not accepted
o A municipal ordinance is different from a resolution. A
resolution is merely a declaration of the sentiment or
opinion of a lawmaking body on a specific matter. An
ordinance possesses a general and permanent character. An
ordinance is a law.
o The defendants in an expropriation case are not limited to
the owners of the property condemned. They include all
other persons owning, occupying or claiming to own the
property.
CONSTITUTIONAL LAW II NOTES & DOCTRINES 9
o In the American jurisprudence, the term “owner” when
employed in statutes relating to eminent domain to
designate the persons who are to be made parties to the
proceeding, refers, as is the rule in respect of those entitled
to compensation, to all those who have lawful interest in the
property to be condemned, including a mortgagee, a lessee
and a vendee in possession under an executory contract.
o The limitations on the power of eminent domain are that the
use must be public, compensation must be made and due
process of law must be observed.
o Eminent Domain is the government’s right to appropriate,
in the nature of a compulsory sale to the State, private
property for public use or purpose.
JUST COMPENSATION
General Rule: In determining “just compensation” in eminent
domain, the value of the property as of the date of the filing of the
complaint is the one considered. (National Power Corporation v.
Court of Appeals)
Exception: When the plaintiff takes possession before the institution
of the condemnation proceedings, the value should be fixed as of the
time of the taking of said possession, not of filing of the complaint.
(Republic v. Philippine National Bank)
Reason for the Exception: Where property is taken ahead of the
filing of the condemnation proceedings, the value thereof may be
enhanced by the public purpose for which it is taken; the entry by the
plaintiff upon the property may have depreciated its value thereby; or,
there may have been a natural increase in the value of the property
from the time the complaint is filed, due to general economic
conditions. (Republic v. Lara)
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o Normally, the time of the taking coincides with the filing of
the complaint for expropriation.
o Eminent domain is generally so described as “the highest
and most exact idea of property remaining in the
government” that may be acquired for some public purpose
through a method in the nature of forced purchase by the
State.
DEFINITION OF “PUBLIC USE”
o For condemnation purposes, “public use” is one which
confers some benefit or advantage to the public; it is not
confined to actual use by the public. It is measured in terms
of a right of the public to use proposed facilities for which
condemnation is sought, and, as long as public has the right
to use, whether exercised by one or many members of
public, a “public advantage” or “public benefit” accrues
sufficient to constitute a public use. (Manosca v. Court of
Appeals)
o The Court has declared as unconstitutional the Presidential
Decrees fixing the just compensation is expropriation cases
to be the value given to the condemned property either by
the owners or assessors, whichever was lower. (Export
Processing Zone Authority v. Dulay)
o The rules for determining just compensation are those laid
down in the Rules of Court, Rule 67 which allows private
respondents to submit evidence on what they consider shall
be the just compensation for their property. (Municipality
of Talisay v. Ramirez)
o Housing is a basic human need. Shortage in housing is a
matter of state concern since it directly ad significantly

affects public health, safety, the environment and in sum
the general welfare. (Sumulong v. Guerrero)
o In an expropriation case where the principal issue is the
determination of just compensation, a trial before the
Commissioners is indispensable to allow the parties to
present evidence on the issue of just compensation.
o The determination of just compensation for a condemned
property is basically a judicial function.
o While the court may accept the commissioners’ report and
render judgment in accordance therewith, it may not do so
without considering whether the report is supported by
evidence.
MANNER OF TAKING
o There is a taking when the owner is actually deprived or
dispossessed of his property; when there is a practical
destruction or a material impairment of the value of his
property or when he is deprived of the ordinary use thereof.
o There is taking in this sense when the expropriator enters
private property not only for momentary period but for a
more permanent duration, for the purpose of devoting the
property to a public use in such a manner as to oust the
owner and deprive him of all beneficial enjoyment thereof.
o The owner of private property should be compensated only
for what he actually loses; it is not intended that his
compensation shall extend beyond his loss or injury. (SEE
Exception to the General Rule, page 9 herein)
PROMPT PAYMENT
o Just compensation means not only the correct
determination of the amount to be paid to the owner of the
land but also the payment of the land within a reasonable
time from its taking.
Republic of the Philippines v. PLDT
Normally, of course, the power of
eminent domain results in the taking or
appropriation of title to, and possession of, the
expropriated property; but no cogent reason
appears why said power may not be availed of
to impose only a burden upon the owner of the
condemned property, without loss of title or
possession. It is unquestionable that real
property may, through expropriation, be
subjected to an easement of right-of-way. In the
case at bar, the easement of right-of-way is
definitely taking under the power of eminent
domain.
Sumulong v. Guerrero
The taking to be valid must be for
public use. There was a time when it was felt
that a literal meaning should be attached to such
a requirement. Whatever project is undertaken
must be for the public to enjoy, as in the case of
streets or parks. Otherwise, expropriation is not
allowable. It is not anymore. As long as the
purpose of the taking is public, then the power
of eminent domain comes into play. As just
noted, the constitution in at least two cases, to
remove any doubt, determine what is public
use. One is the expropriation of lands to be
CONSTITUTIONAL LAW II NOTES & DOCTRINES 10
subdivided into small lots for resale at cost to
individuals. The other is in the transfer, through
the exercise of this power, of utilities and other
private enterprises to the government. It is
accurate to state then that at present whatever
may be beneficially employed for the general
welfare satisfies the requirement of public use.
o The courts have the power to inquire into the legality of the
exercise of the right of eminent domain and to determine
whether there is a genuine necessity therefor. (SEE City of
Manila v. Chinese Community of Manila)
o Intervention by the barangay is unnecessary where the
barangay can establish its claim by a separate and
independent action of its own, or can obtain authority for
itself from the municipality to pursue the action of eminent
domain.
Requisites before a writ of possession can be issued by the Court:
1. There must be a complaint for expropriation sufficient in
form and in substance;
2. A provisional determination of just compensation must be
made by the trial court on the basis of judicial (not
legislative or executive) discretion; and
3. The deposit requirement under the Rules of Court, Rule 67,
Section 2 must be complied with.
POWER OF EMINENT DOMAIN
Requisites for a valid exercise of the power of eminent domain:
1. The property taken must be private property.
2. There must be genuine necessity to take private property.
3. The taking must be for public use.
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4. There must be payment of just compensation.
5. The taking must comply with due process of law
(Manapat v. Court of Appeals)
Circumstances present in the “taking” of property for purposes of
eminent domain:
1. The expropriator must enter a private property.
2. The entrance into private property must be for more than a
momentary period.
3. The entry into the property should under warrant or color
of legal authority.
4. The property must be devoted to a public use or otherwise
informally appreciated or injuriously affected.
5. The utilization of the property for public use must be in
such a way to oust the owner and deprive him of all
beneficial enjoyment of the property.
(National Power Corp. v. Court of Appeals)
WHO MAY EXERCISE EMINENT DOMAIN
Municipality of Paranaque v. V.M. Realty Corporation
The power of eminent domain is lodged in the
legislative branch of the government, which
may delegate the exercise thereof to LGUs,
other public entities and public utilities. An
LGU may therefore exercise the power to
expropriate private property only when
authorized by Congress and subject to the
latter’s control and restraints, imposed “through
the law conferring the power or in other
legislations.”

o Once the State decides to exercise its power of eminent
domain, the power of judicial review becomes limited in
scope, and the courts will be left to determine the
appropriate amount of just compensation to be paid to the
affected landowners. Only when the landowners are not
given their just compensation for the taking of their
property or when there has been no agreement on the
amount of just compensation may the remedy of petition
for prohibition become available. (Yusay v. Court of
Appeals)
o The general rule upon filing of expropriation complaint,
the plaintiff has the right to take or enter into possession of
the real property involved if he deposits with the authorized
government depositary an amount equivalent to the
assessed value of the property for purposes of taxation. An
exception to this procedure is provided by R.A. No. 8974.
It requires the payment of 100% zonal value of the property
to be expropriated to the entitle the plaintiff to a writ of
possession.
Remember: R.A. No. 8974 does not take away from the
courts the power to judicially determine the amount of just
compensation. The law merely sets the minimum price of
the property as the provisional value. Thus, the amount of
just compensation must still be determined by the courts
according to the standards stated in R.A. No. 8974, Section
5. (Metropolitan Cebu Water District v. J. King and Sons
Company, Inc.)
WHAT CONSTITUTES TAKING
o The Court rejected the State’s contention that a lease on a
year to year basis can give rise to a permanent right to
occupy, since by express legal provision a lease made for a
determinate time, as was the lease of Castellvi’s land,
ceases upon the day fixed, without need of a demand.
Neither can it be said that the right to eminent domain
may be exercised by simply leasing the premises to be
expropriated. (Republic v. Castellvi)
o Taking also occurs when agricultural lands are voluntarily
offered by a landowner and approved by Presidential
Agrarian Reform Council (PARC) for CARP coverage
through the stock distribution scheme. (Hacienda Luisita,
Inc. v. Presidential Agrarian Reform Council)
o It was the PARC approval which should be considered as
the effective date of taking as it was only during this time
that the government officially confirmed the CARP
coverage of these lands.
o The threshold requisites for a lawful taking of private
property for public use need to be examined here: one is the
necessity of the taking and another is legal authority to
effect the taking.
o It has not been suggested that COMELEC has been granted
the power of eminent domain either by the Constitution or
by the legislative authority. A reasonable relationship
between that power and the enforcement and administration
of election laws by COMELEC must be shown; it is not
casually to be assumed. (Philippine Press Institute, Inc. v.
Commission on Elections)
o Resolution No. 2772, Section 2 does not provide a
constitutional basis for compelling publishers, against their
will to provide free print space for COMELEC purposes.
CONSTITUTIONAL LAW II NOTES & DOCTRINES 11
Section 2 does not constitute a valid exercise of the power
of eminent domain. (Ibid.)
PUBLIC PURPOSE
o With respect to the element of public use, the expropriator
should commit to use the property pursuant to the purpose
stated in the petition for expropriation filed, failing which,
it should file another petition for the new purpose. If not, it
is then incumbent upon the expropriator to return the said
property to its private owner, if the latter desires to acquire
the same.
o If public purpose or intent is not initiated or not at all
pursued, and is peremptorily abandoned, then the former
owners, if they so desire, may seek the reversion of the
property, subject to the return of the amount of just
compensation received. (Mactan-Cebu International
Airport Authority v. Lozada)
Old Concept of “Public Purpose” or “Public Use”
Condemned property must actually be used by the general public
(e.g., roads, bridges, public plazas, etc.) before the taking could
satisfy the constitutional requirement of public use.
New Concept
Public advantage, convenience or benefit, which tends to contribute
to the general welfare and to the prosperity of the whole community,
like a resort complex for tourists or housing project.
(Province of Camarines Sur v. Court of Appeals)
JUST COMPENSATION
o The land reform process is completed only upon payment
of just compensation relate to the issue of the applicable law
on just compensation. The disposition that the seizure of the
landholding would take effect on the payment of just
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compensation since it is only at that point that the land
reform process is completed refers to property acquired
under P.D. No. 27 but which remained unpaid until the
passage of R.A. No. 6657. (Department of Agrarian Reform
v. Gaduco)
o While the RTC is required to consider the acquisition cost
of the land, the current value of like properties, its nature,
actual use and income, the sworn valuation by the owner,
the tax declaration and the assessment made by the
government assessors to determine just compensation, it is
equally true that these factors have been translated into a
basic formula by the DAR pursuant to its rulemaking
power under R.A. No. 6657, Section 49. As the government
agency principally tasked to implement the agrarian
reform program. (Land Bank of the Philippines v.
Honeycomb Farms Corporation)
Action to recover just compensation VS Action for damages
o The action to recover just compensation from the State or
its expropriating agency differs from the action for
damages. The former, also known as inverse
condemnation, has the objective to recover the value of
property taken in fact by governmental defendant, even
though no formal exercise of the power of eminent domain
has been attempted by the taking agency.
The latter action (action for damages) seeks to vindicate a
legal wrong through damages, which may be actual, moral,
nominal, temperate, liquidated, or exemplary. When a right
is exercised in a manner not conformable with the norms
enshrined in Article 19 and like provisions on human
relations in the Civil Code. (National Power Corporation
v. Heirs of Macabangkit Sangkay)

Constitutionally, “just compensation” is the
sum equivalent to the market value of the
property, broadly described as the price fixed
by the seller in open market in the usual and
ordinary course of legal action and competition,
or the fair value of the property as between the
one who receives and the one who desires to
sell, it being fixed at the time of the actual
taking by the government. Just compensation
is defined as the full and fair equivalent of
the property taken from its owner by the
expropriator. It has been repeatedly stressed
by this Court that the true measure is not the
taker’s gain but the owner’s loss. The word
“just” is used to modify the meaning of the
word “compensation” to convey the idea that
the equivalent to be given for the property to
be taken shall be real, substantial, full and
ample. (Land Bank of the Philippines v. Orilla)
o Apart from the requirement, that compensation for
expropriated land must be fair and reasonable,
compensation, to be “just,” must also be made without
delay.
o The Court fixed the applicable interest rate at 12% per
annum, computed from the time the property was taken
until the full amount of just compensation was paid, in order
to eliminate the issue of the constant fluctuation and
inflation of the value of the currency over time.
Pertinent Court’s ruling in relation to delay and payment of
complete just compensation:
1. When the obligation is breached, and it consists in the
payment of a sum of money, i.e., a loan or forbearance of
money, the interest due should be that which may have been
stipulated in writing. Furthermore, the interest due shall
itself earn legal interest from the time it is judicially
demanded. In the absence of stipulation, the rate of interest
shall be 12% per annum to be computed from default, i.e.,
from judicial or extrajudicial demand under and subject to
the provisions of Article 1169 of the Civil Code.
2. When an obligation, not constituting a loan or forbearance
of money, is breached, an interest on the amount of
damages awarded may be imposed at the discretion of the
court at the rate of 6% per annum. No interest, however,
shall be adjudged on unliquidated claims or damages except
when or until the demand can be established with
reasonable certainty. Accordingly, where the demand is
established with reasonable certainty, the interest shall
begin to run from the time the claim is made judicially or
extrajudicially (Civil Code, Article 1169) but when such
certainty cannot be so reasonably established at the time the
demand is made, the interest shall begin to run only from
the date the judgment of the court is made (at which time
the quantification of damages may be deemed to have been
reasonably ascertained). The actual base for the
computation of legal interest shall, in any case, be on the
amount finally adjudged.
3. When the judgment of the court awarding a sum of money
becomes final and executory, the rate of legal interest,
whether the case falls under paragraph or paragraph 2,
above, shall be 12% per annum from such finality until its
CONSTITUTIONAL LAW II NOTES & DOCTRINES 12
satisfaction, this interim period being deemed to be by then
an equivalent to a forbearance of credit.
o the owner’s loss, of course, is not only his property but also
its income-generating potential. Thus, when property is
taken, full compensation of its value must immediately be
paid to achieve a fair exchange for the property and the
potential income lost. (Apo Fruits Corporation v. Land
Bank of the Philippines)
Provisional value VS. Just compensation
The first refers to the preliminary or provisional determination
of the value of the property. It serves a double purpose or
prepayment if the property is fully expropriated, and of an
indemnity for damages if the proceedings are dismissed. It is
not a final determination of just compensation and may not be
necessarily equivalent to the prevailing fair market value of the
property. Of course, it may be a factor to be considered in the
determination of just compensation.
Just compensation, on the other hand, is the final determination
of the fair market value of the property. It has been described as
“the just and complete equivalent of the loss which the owner
of the thing expropriated has to suffer by reason of the
expropriation.”
(Republic v. Cancio)
o There is no provision in the CARL/CARP on the right of a
lessee of a private agricultural land to just compensation for
the crops it planted and improvements it built thereon,
which could be recognized separately and distinctly from
the right of the landowner to just compensation for his land.
JAMES BRYAN SUAREZ DEANG © 2017 (09265563619/jbsdeang.jbd@gmail.com)
Standing crops and improvements, if they do not come with
the land, are totally inconsequential for CARP purposes.
(Land Bank of the Philippines v. AMS Farming
Corporation)
o The decision of the government to acquire a property
through eminent domain should be made known to the
property owner through a formal notice (NOT through
news or television announcement) wherein a hearing or
judicial proceeding is contemplated as provided for in the
Rules of Court, Rule 67. This shall be the time of reckoning
the value of the property for the purpose of just
compensation. (Manotok v. National Housing Authority)
o Rules of Court, Rule 67, Section 5 calls for the
appointment of not more than three competent and
disinterested persons as commissioners to ascertain and
report to the court the just compensation for the property
sought to be taken. (Municipality of Daet v. Court of
Appeals)
ESTOPPEL AND LACHES
o In the failure to prove payment in full of just compensation
and due to the fact that expropriation was not
consummated, there is the existence of estoppel and laches
which will render the buyer’s (in good faith) title must be
recognized as valid and subsisting.
REFERENCE
 Constitutional Law Text and Cases (Bill of Rights) by
Miriam Defensor Santiago (2016)

THE INHERENT POWERS OF THE STATE:
POWER OF TAXATION
o The power to tax emanates from necessity; without taxes,
government cannot fulfill its mandate of promoting the
general welfare and well-being of the people.
o Taxes are the lifeblood of the government and should be
collected without the unnecessary hindrance.
o The 1997 National Internal Revenue Code expressly
provides that no court shall have the authority to grant an
injunction to restrain the collection of any national internal
revenue tax, fee or charge imposed by the code.
Exception: When in the opinion of the Court of Tax Appeal
the collection thereof may jeopardize the interest of the
government and/or the taxpayer.
o In the case of collection of local taxes, there is no express
provision in the Local Government Code prohibiting courts
from issuing an injunction to restrain local governments
from collecting taxes. However, courts shall exercise
extreme caution in issuing such injunctions.
Contract Clause
o Contract clause has never been thought as a limitation on the
exercise of the State’s power of taxation save only where a
tax exemption has been granted for a valid consideration.
o Not only are existing laws read into contracts in order to fix
obligations as between parties, but the reservation of
essential attributes of sovereign power is also read in
contracts as a basic postulate of the legal order.
o The Court recognizes the well trenched principle that
estoppel does not apply to government, especially on matters
of taxation. Taxes are the nation’s lifeblood through which
the government agencies continue to operate and with which
the State discharges its functions for the welfare of its
constituents. As an exception, however, this general rule
cannot be applied if it would work injustice against an
innocent party. (Commissioner of Internal Revenue v. Petron
Corporation)
o A principle deeply embedded in our jurisprudence is that
taxes being the lifeblood of the government should be
collected promptly, without unnecessary hindrance or delay.
(Angeles City v. Angeles Electric Corporation)
Concept and Rationale of the Minimum Corporate Income Tax
(MCIT)
o Domestic corporations owe their corporate existence and
their privilege to do business to the government. They also
benefit from the efforts of the government to improve the
financial market and to ensure a favorable business climate.
It is therefore fair for the government to require to make a
reasonable contribution to the public expenses.
o This is to stop the underdeclaration of income or
overdeduction of expenses otherwise called tax shelters.
o The primary purpose of any legitimate business is to earn a
profit. Continued and repeated losses after operations of a
corporation or consistent reports of minimal net income
render its financial statements and its tax payments suspect.
o This also to prevent tax evasion and tax avoidance schemes.
o Taxation is an inherent attribute of sovereignty. It is a power
that is purely legislative. Essentially, this means that in the
legislature primarily lies the discretion to determine the
CONSTITUTIONAL LAW II NOTES & DOCTRINES 13
nature (kind), object (purpose), extent (rate), coverage
(subjects) and situs (place) of taxation.
General Rule: The power to tax is plenary and unlimited in its range,
acknowledging in its very nature no limits, so that the principal check
against its abuse is to be found only in the responsibility of the
legislature (which imposes tax) to its constituency who are to pay it.
Presumption of Tax Laws: In favor of its constitutionality
o It is income, not capital, which is subject to income tax.
(Chamber of Real Estate and Builders’ Association, Inc. v.
Romulo)
o Fees may be properly regarded as taxes even though they
also serve as an instrument of regulation. Indeed, taxation
may be made the implement of the state’s police power.
It is possible for an exaction to be both tax and
regulation. License fees are often looked to as a
source of revenue as well as a means of
regulation. That is true, for example, of
automobile license fees. In such case, fees may
be properly regarded as taxes even though they
also serve as an instrument of regulation.
(Philippine Airlines, Inc. v. Edu)
o If the purpose is primarily revenue, or if revenue is, at least,
one of the real and substantial purposes, then the exaction
is properly called a tax.
o Congress found the registration of vehicles a very
convenient way of raising much needed revenues. Without
JAMES BRYAN SUAREZ DEANG © 2017 (09265563619/jbsdeang.jbd@gmail.com)
changing the earlier denomination of registration payments
as “fees,” their nature has become that of “taxes.”
(Philippine Airlines, Inc. v. Edu)
o Taxation is, of course, to be admitted that for all its
plenitude, the power to tax is not unconfined. There are
restrictions. The Constitution sets forth such limits.
Adversely affecting as it does property rights, both the due
process and equal protection clauses may properly be
invoked, as petitioner does, to invalidate in appropriate
cases a revenue measure. (Sison v. Ancheta)
“The power to tax involves the power to destroy.”
– Chief Justice Marshall
o Where the assailed tax measure is beyond the jurisdiction
of the state, or is not for a public purpose, or, in case of a
retroactive statute is so harsh and unreasonable, it is subject
to attack on due process grounds. (Sison v. Ancheta)
o At any rate, it is inherent in the power to tax that a state be
free to select the subjects of taxation, and it has been
repeatedly held that ‘inequalities which result from singling
out of one particular class for taxation, or exemption
infringe no constitutional limitation.’” (Lutz v. Araneta)
o Equality and uniformity in taxation means that all taxable
articles or kinds of property of the same class shall be taxed
at the same rate. The taxing power has the authority to make
reasonable and natural classifications for purpose of
taxation. (Sison v. Ancheta)
 CONSTITUTIONAL LAW II NOTES & DOCTRINES 14

TAX EXEMPTIONS transaction. (Philippine Banking Corporation v.

Rule: Statutes granting tax exemptions are construed strictissimi
juris against the taxpayer and liberally in favor of the taxing authority.
o A claim of tax exemption must be clearly shown and based
on language in law too plain to be mistaken.
Burden of Proof: Party claiming the exemption
Basis of the rule: To minimize differential treatment and foster
impartiality, fairness, and equality of treatment among taxpayers.
o They must be expressed in the clearest and most
unambiguous language and not left to mere implications.
Tax exclusion
o An exemption is an immunity or a privilege; it is the
freedom from a charge or burden to which others are
subjected.
o An exclusion is the removal of otherwise taxable items
from the reach of taxation. It is also an immunity or
privilege which frees a taxpayer from a charge to which
others are subjected.
Tax amnesty
o It is a general pardon or the intentional overlooking by the
State of its authority to impose penalties on persons
otherwise guilty of violation of a tax law.
Tax refund
o Tax refunds or tax credits are not founded principally on
legislative grace but on the legal principle which underlies
all quasi-contracts abhorring a person’s unjust enrichment
at the expense of another.
o The taxpayer expects fair dealing from the government and
the latter has the duty to refund without any unreasonable
delay what it has erroneously collected. (solution indebiti)
Commissioner of Internal Revenue)
Question: May surviving or new corporations avail of the tax
amnesty in behalf of the corporations absorbed or dissolved?
Answer: YES, these companies can avail of the tax amnesty for
purposes of obtaining tax clearances for the dissolved or absorbed
companies.
o The DST is one of the taxes covered by the Tax Amnesty
Program under R.A. No. 9480.
o Revenue generation has undoubtedly been a major
consideration in the passage of the Tax Code. However, as
borne by the legislative record, the shift from the ad
valorem system to specific tax system is likewise meant to
promote fair competition among the players in the
industries concerned, to ensure an equal distribution of the
tax burden and to simplify tax administration by classifying
cigarettes, among others, into high, medium, or low priced
based on their net retail price and accordingly graduating
tax rates. (Commissioner of Internal Revenue v. Fortune
Tobacco Corporation)
o A tax exemption cannot be grounded upon the continued
existence of a statute which precludes its change or repeal.
Flowing from the basic precept of constitutional law that no
law is irrepealable, Congress, withdrawing a tax exemption
just as efficaciously as it may grant the same under the
Constitution. (Republic v. Caguioa)
REFERENCE

JAMES BRYAN SUAREZ DEANG © 2017 (09265563619/jbsdeang.jbd@gmail.com)

o Under the Tax Code, apparently in recognition of the
pervasive quasi-contract principle, a claim for tax refund  Constitutional Law Text and Cases (Bill of Rights) by
may be based on the following: Miriam Defensor Santiago (2016)
a. Erroneously or illegally assessed or
collected internal revenue taxes;
b. Penalties imposed without authority;
c. Any sum alleged to have been excessive or
in any manner wrongfully collected

No vested right in tax exemption

o Being a mere statutory privilege, a tax exemption may be
modified or withdrawn at will by the granting authority.
o The power to impose taxes is one so unlimited in force and
so searching in extent, it is subject only to restrictions which
rest on the discretion of the authority exercising it.

o The exercise of taxing power of local government units is

subject to the limitations enumerated in the Local
Government Code, Section 133. Under Local Government
Code, Section 133(o), local government units have no
power to tax instrumentalities of the national government
(like the MIAA). Hence, MIAA is not liable to pay real
property taxes for the NAIA Pasay properties. (Manila
International Airport Authority v. City of Pasay)

o Documentary stamp tax (DST) is a tax on documents,

instruments, loan agreements, and papers evidencing the
acceptance, assignment, sale or transfer of an obligation,
right or property incident thereto. A DST is actually an
excise tax because it is imposed on the transaction rather
than the document. Hence, in imposing the DST, the Court
considers not only the document but also the nature of the