G.R. No. 141323 - Pelayo vs. Perez

Petitioner Office of the Solicitor General (OSG) filed a Petition for Review on Certiorari under Rule 45 seeking to reverse the Court of Appeals’ Decision of 25 January 2007 and Resolution of 14 March 2007, which affirmed the RTC’s Joint Decision of 29 May 2002.
Respondents Ayala Land, Robinsons Land, Shangri-La Plaza and SM Prime operate shopping malls and attendant parking facilities in Metro Manila, charging users fixed parking fees.

In 1999, the Senate Committees on Trade and Commerce and Justice and Human Rights held hearings on mall parking fees, resulting in Senate Committee Report No. 225 (May 2000) concluding that charging parking fees violated the National Building Code and recommending OSG action to enjoin fees, DTI regulation, and amendment of the Code to prohibit fees.
The DPWH Secretary and local building officials, deputized by the Local Government Code, were alleged to plan, via the OSG, enforcement actions under PD 1096 (National Building Code) and its IRR.

SM Prime filed a Petition for Declaratory Relief (Rule 63) docketed as Civil Case No. 00-1208; the OSG filed a Petition for Declaratory Relief and Injunction (with TRO and preliminary injunction) as Civil Case No. 00-1210.
The RTC consolidated both actions, limited issues in a pre-trial order (capacity of OSG; propriety of declaratory relief; obligation to provide free parking; damages), and on 29 May 2002 ruled that:

The OSG had capacity and declaratory relief was proper.
The National Building Code and IRR did not obligate free parking; requiring free parking would be an unlawful taking without compensation.
No damages were warranted.

The OSG appealed on the single pure question of law whether the Code and IRR intended free parking.
SM Prime appealed on four grounds: ultra vires enactment of Rule XIX; ineffectiveness for lack of publication; failure to exhaust administrative remedies; lack of OSG capacity/real party in interest.
The Court of Appeals (CA-G.R. CV No. 76298) dismissed the OSG’s pure legal issue for lack of factual issues but, in the interests of justice, addressed the merits and affirmed the RTC in toto.

The OSG’s sole assignment before this Court is that the CA “seriously erred” in affirming that malls are not obliged to provide free parking.

Whether the OSG had the legal capacity to sue on behalf of the government and public welfare.

Whether all requisites for declaratory relief (justiciable controversy, adverse interests, legal interest, ripeness) were met.

Whether Section 803 of PD 1096 and Rule XIX of its IRR mandate that mall owners provide parking spaces free of charge.

Whether the OSG was required to exhaust administrative remedies before seeking judicial relief.

Whether respondents or the OSG were entitled to damages as a result of the parking fee controversy.