G.R. No. L-7552 - City of Iloilo vs. Vicente Pinzon

In 1945, the City of Iloilo enacted Ordinance No. 33, Series of 1945, imposing a "municipal license tax fee" on certain businesses or occupations considered “unwholesome, obnoxious, offensive, unhygienic or dangerous,” including tenement houses (casas vecindad).
Tenement houses were subjected to a flat annual tax of P25.00 regardless of location within Iloilo City (covering districts such as Iloilo, Jaro, La Paz, Arevalo, Molo, or Mandurriao).
In 1946, Ordinance No. 86, Series of 1946, amended the previous schedule by differentiating the rate between houses engaged in business on specific streets and other areas, but maintained the P25.00 annual rate for ordinary tenement houses.

Defendant, Vicente Pinzon, was the owner of five tenement houses located at various streets in Iloilo City:

The City of Iloilo filed an action on July 12, 1948, in the Court of First Instance to recover municipal license taxes amounting to P262.50 plus a 20% penalty. This sum corresponded to the last quarter of 1946, the whole year of 1947, and the first two quarters of 1948.

The municipal license tax was imposed under Ordinances No. 33 (1945) and its amendment, Ordinance No. 86 (1946).
Defendant Pinzon contended that Ordinance No. 86, Series of 1946, was invalid and unconstitutional, arguing that it exceeded the limited power granted to the City by its Charter.
Pinzon argued further that his houses were not "tenement houses" as defined by Section 130 of the Revised Ordinances of Iloilo City because each house was occupied by only one family, contrary to the definition requiring multi-family occupancy.
Defendant maintained that his understanding, based on a general dictionary definition of “tenement houses” (as “house rented or for rent”), led to his stipulation that he owned five such houses.

The Court of First Instance ruled in favor of the City, holding that the ordinance was validly enacted under the general welfare clause and Section 21(cc) of the city charter, and that the definition and regulation of “casas vecindad” were properly established in Sections 130 to 144 of the Revised Ordinances.
Defendant Pinzon filed a verified motion for relief from the stipulation of facts and for a new trial, claiming a mistake in his stipulation based on the differing interpretations of the term “tenement houses.”
The lower court denied the motion for relief, prompting defendant Pinzon to appeal.

Whether the lower court erred in denying the defendant’s motion for relief from the stipulation of facts, given his claim that his houses do not meet the statutory definition of “casas vecindad.”

The argument centers on whether, if proven that each house was occupied by only one family, the tax should not have been imposed on him.
Whether the stipulation, entered without fully ascertaining the meaning of the terms as defined in Section 130 of the Revised Ordinances, constitutes a reversible mistake.

Whether Ordinance No. 86, Series of 1946, is valid in imposing a municipal license tax fee or is unconstitutional and void as it levies a tax not authorized by law.

The defendant asserts that the ordinance exceeds the power granted by the City Charter.
The issue requires examining if the ordinance’s imposition of tax meets legal standards for taxation and constitutional authority.