G.R. No. 224825 - City of Cagayan De Oro vs. Cagayan Electric Power and Light Co., Inc.

Enactment of Ordinance No. 9527-2005
On January 24, 2005, the City Council of Cagayan de Oro enacted Ordinance No. 9527-2005 imposing an annual Mayor’s Permit Fee of ₱500 per electric or telecommunications pole.
The ordinance’s whereas clauses cited hazards to traffic and public safety, the need to regulate pole maintenance, required the City Engineer to inventory poles for fee imposition, exempted national government poles, and provided for publication and effectivity.

CEPALCO’s Challenge
Cagayan Electric Power & Light Co., Inc. (CEPALCO), owning approximately 17,000 poles, faced an annual fee of about ₱8.5 million and filed on September 30, 2005 a petition for declaratory relief with damages, seeking to enjoin and void the ordinance as excessive, oppressive, confiscatory, and in conflict with its legislative franchise.
The Regional Trial Court (RTC) of Cagayan de Oro (Branch 17) granted a preliminary injunction (May 5, 2006) but, on February 8, 2008, dismissed the petition for failure to exhaust administrative remedies under Section 187 of the Local Government Code (RA 7160) and for being time-barred, dissolving the injunction.

Appellate Proceedings
On June 10, 2015, the Court of Appeals (CA) in CA-G.R. CV No. 02771-MIN reversed the RTC resolution, declared Ordinance No. 9527-2005 void as exorbitant and unreasonable, and held that no administrative appeal to the Secretary of Justice was required for a regulatory fee.
The City of Cagayan de Oro filed a petition for review on certiorari (G.R. No. 224825), and on October 17, 2018, the Supreme Court promulgated its decision.

Whether CEPALCO was required to exhaust administrative remedies by appealing the ordinance to the Secretary of Justice before filing judicial proceedings.
Whether the annual Mayor’s Permit Fee of ₱500 per pole is excessive, unreasonable, oppressive, or arbitrary under the Local Government Code.