Case Summary (G.R. No. 137842)
Petitioner
Coca-Cola Bottlers Philippines, Inc.
Respondents
City of Manila, represented by its City Treasurer and the Chief of the Licensing Division.
Key Dates
• February 25, 2000 – Approval of Tax Ordinance No. 7988 (Revised Revenue Code).
• August 17, 2000 – DOJ Secretary Tuquero declares Ordinance No. 7988 null and void.
• November 16–20, 2000 – BLGF directs the City Treasurer to cease enforcing Ordinance No. 7988.
• January 17, 2001 – Petitioner files injunction suit in RTC Manila, Branch 21.
• November 28, 2001 – RTC grants permanent injunction against Ordinance No. 7988.
• February 22, 2001 – City enacts Tax Ordinance No. 8011 to amend No. 7988.
• July 5, 2001 – DOJ Secretary Perez declares Ordinance No. 8011 null and void.
• May 8 & December 5, 2002 – RTC dismisses petitioner’s injunction case, denies reconsideration.
• June 27, 2006 – Supreme Court issues final decision.
Applicable Law
• 1987 Philippine Constitution, Article X (Local Government).
• Republic Act No. 7160 (Local Government Code of 1991), Sections 187, 188, 190, and 143(h).
• Implementing Rules of the Local Government Code, Article 277.
• Rule 45, Rules of Civil Procedure (Petition for Review on Certiorari).
Procedural History
- Petitioner invoked Section 187, LGC, before the DOJ to challenge Section 21 of Ordinance No. 7988 for deleting an exemption clause and exceeding Manila’s taxing powers.
- DOJ Secretary Tuquero found that Ordinance No. 7988 was not published for three consecutive days as required by Section 188, LGC, and its IRR, and declared it null and void. The City did not appeal.
- BLGF ordered the City Treasurer to cease enforcement. The City nonetheless assessed petitioner under Ordinance No. 7988 for 2001.
- Petitioner obtained a permanent injunction from the RTC, Branch 21, enjoining implementation of Ordinance No. 7988.
- During litigation, the City enacted Ordinance No. 8011 to amend the void Ordinance No. 7988. Petitioner again sought DOJ relief; Secretary Perez held that amending a non-existent ordinance is futile and declared No. 8011 void.
- The City’s attempts to appeal or seek certiorari against DOJ resolutions to the RTC, Branch 17 and to the Supreme Court, failed for lack of jurisdiction or procedural default.
- The City moved in RTC, Branch 21, to dismiss the injunction case on the ground that Ordinance No. 7988 had been amended by No. 8011. The trial court granted dismissal and denied reconsideration.
- Petitioner filed a Petition for Review on Certiorari (Rule 45) to the Supreme Court, challenging the RTC’s dismissal orders.
Issue
Whether the RTC erred in dismissing the injunction case on the basis that a void ordinance (No. 7988) had been “amended” by another void ordinance (No. 8011), thereby depriving petitioner of relief against an ordinance already declared null and void.
Ruling
The Petition is granted. The Supreme Court reverses and sets aside the RTC orders dated 8 May 2002 and 5 December 2002.
Rationale
- Publication Requirement. Both the LGC (Section 188) and its IRR mandate mandatory publication of tax ordinances for three consecutive days. Ordinance No. 7988 was published only once, rendering it void under the imperative “shall” of the statute and its rules.
- Finality of DOJ Resolutions. The DOJ resolutions declaring both
Case Syllabus (G.R. No. 137842)
Background and Procedural History
- Petitioner Coca-Cola Bottlers Philippines, Inc. manufactures and sells beverages with a sales office in Manila.
- On 25 February 2000, Manila’s Mayor approved Tax Ordinance No. 7988, revising the Revenue Code and repealing Ordinance No. 7794.
- Petitioner filed before the Department of Justice (DOJ) a challenge under Section 187 of the Local Government Code (RA 7160) to the constitutionality of Section 21 of Ordinance No. 7988.
- Petitioner subsequently filed a complaint for injunction in the Regional Trial Court (RTC), Manila Branch 21, praying respondents be enjoined from implementing the new tax ordinance.
- The RTC rendered judgment permanently enjoining respondents on 28 November 2001.
- Respondents moved for reconsideration before the RTC, which was granted on 8 May 2002 by reason of the enactment of Tax Ordinance No. 8011.
- Petitioner’s motion for reconsideration was denied on 5 December 2002, prompting this Supreme Court petition under Rule 45.
Tax Ordinance No. 7988 and Constitutional Challenge
- Ordinance No. 7988 increased business tax rates previously set by Ordinance No. 7794.
- Section 21 of the old code exempted registered businesses already paying tax; this paragraph was deleted in the new code.
- Petitioner argued the deletion imposed an additional tax in excess of the taxing power granted by Section 143(h) of RA 7160 and violated Article X, Section 5 of the 1987 Constitution.
- Petitioner invoked Section 187’s 30-day appeal period and questioned whether respondents complied with mandatory public hearings and procedural requirements.
DOJ Resolution Declaring Ordinance No. 7988 Null and Void
- On 17 August 2000, DOJ Secretary Artemio G. Tuquero declared Ordinance No. 7988 “null and void and without legal effect.”
- Cited Section 188 of RA 7160 and Article 277(a) of its implementing rules requiring publication “within ten (10) days after approval” for “three (3) consecutive days” in a local newspaper or posting in two conspicuous places.
- Found respondents published Ordinance No. 7988 only once (Philippine Post, 22 May 2000) and failed to file comments or proof of full compliance.
- Held strict observance of publication is mandatory, and its omission voids a tax ordinance.
BLGF Directive to Cease and Desist Enforcement
- On 16 November 2000, Singer Sewing Machine Company’s coun