Title
Rama vs. Moises
Case
G.R. No. 197146
Decision Date
Dec 6, 2016
Cebu City Mayor vs. Cebu Governor over MCWD Board appointments; SC ruled Section 3(b) of PD 198 unconstitutional, upholding local autonomy, due process, and equal protection for highly urbanized cities.

Case Summary (G.R. No. 197146)

Key Dates and Chronology of Relevant Events

PD No. 198 enacted May 25, 1973; MCWD formed 1974. From 1974–2002, the Mayor of Cebu City appointed MCWD board members. July 2002: Cebu Provincial Governor Pablo L. Garcia asserted appointing authority under Section 3(b) of PD 198. February 22, 2008: Mayor Osmeña appointed Joel Mari S. Yu to the MCWD Board. June 13, 2008: Governor Gwendolyn F. Garcia filed an action to declare that appointment null. RTC decision annulling Yu’s appointment rendered November 16, 2010. Supreme Court decision resolving the certiorari petition rendered December 6, 2016.

Applicable Law and Constitutional Framework

Primary instrument under review: Section 3(b) of PD No. 198 (Provincial Water Utilities Act of 1973), which designates the appointing authority for a local water district’s board depending on the distribution of active water service connections (mayor if >75% of connections are within a city/municipality; otherwise governor). Governing constitutional baseline: the 1987 Philippine Constitution (decision in 2016 mandates use of the 1987 Constitution). Relevant statutory developments: Batas Pambansa Blg. 51 (1979) reclassification of cities; Republic Act No. 7160 (1991 Local Government Code) guaranteeing local autonomy and prescribing province–city–barangay relations and supervisory powers.

Factual Background and Legal Dispute

MCWD was formed under PD 198 and operated by pooling waterworks from Cebu City and several neighboring cities and municipalities. Historically the Cebu City Mayor appointed MCWD directors. After Cebu City’s share of active MCWD water connections fell below the 75% benchmark specified in Section 3(b), provincial officials asserted appointing authority. Vacancies and competing appointments followed, culminating in litigation to determine (a) the proper appointing authority and (b) the constitutionality of Section 3(b) as applied to the present status of highly urbanized cities (HUCs) and to local autonomy guarantees under the 1987 Constitution and the Local Government Code.

Procedural History before the Regional Trial Court

The MCWD and others initially sought declaratory relief; one RTC action was dismissed without definitive ruling on appointing authority. After competing appointments were made to avoid a board vacancy, Governor Gwendolyn Garcia filed Civil Case No. CEB-34459 to annul the appointment of Joel Mari S. Yu. RTC Branch 18 found Yu’s appointment illegal and void (Nov. 16, 2010), holding that because Cebu City’s active water connections were 61.28% (below 75%), the appointing power vested in the provincial governor under Section 3(b). The RTC contemporaneously held that Section 3(b) did not offend the Constitution or the Local Government Code.

Issues Presented to the Supreme Court

  • Whether the RTC gravely abused its discretion by failing to properly adjudicate the constitutionality of Section 3(b) of PD 198 and by improperly treating the matter as a political question.
  • Whether Section 3(b) of PD 198 is inconsistent with and superseded by the local autonomy provisions of the 1987 Constitution and the 1991 Local Government Code insofar as it applies to highly urbanized cities and component cities whose charters prohibit voting for provincial elective officials.
  • Whether Section 3(b) violates substantive due process and the Equal Protection Clause by creating arbitrary classification and permitting a provincial appointing authority to control board appointments where an HUC supplies the majority of the district’s water connections.

Justiciability and Mootness — Supreme Court’s Preliminary Observations

The Court held that the case was not moot despite the expiration of Yu’s term (Dec. 31, 2012) because: (a) the matter implicates significant public interest (management of a public utility affecting residents), and (b) the issue is capable of repetition yet evading review. The Court also clarified that the RTC had the power and duty to decide constitutionality; treating the issue as a political question was improper where the challenge was to the validity of a decree, not merely its wisdom.

Supreme Court’s Analysis on PD 198’s Continued Validity and Local Autonomy

The Court recognized the presumption of validity for pre-1987 laws and decrees but reiterated that such presumption yields where the earlier law conflicts with the 1987 Constitution and later statutes. The Court analyzed the evolution of local government law: reclassification of Cebu City into a highly urbanized city (B.P. Blg. 51) and the enactment of the Local Government Code (R.A. 7160), which strengthened local autonomy and expressly made HUCs independent of their provinces. The Court concluded that PD 198’s Section 3(b), as originally framed in 1973, no longer consonantly reflected the constitutional guarantees and statutory framework establishing and protecting the autonomy of HUCs and certain component cities.

Due Process and Equal Protection Analysis

The Court applied substantive due process and equal protection principles: classifications must rest on substantial distinctions germane to the law’s purpose and not be arbitrary. While Section 3(b)’s 75% criterion might have been reasonable in 1973, its continued application without regard to subsequent reclassification of cities into HUCs and the Local Government Code’s local autonomy policy rendered the provision arbitrary and unfair in those contexts. The Court emphasized that MCWD principally served Cebu City (61.28% of active connections) and that allowing the provincial governor to appoint the MCWD board despite the HUC status and predominant consumer base undermined the local-autonomy objectives and the decree’s own declared purpose of locally-controlled water utilities responsive to local needs.

Holding and Relief Granted by the Supreme Court

The Supreme Court granted the petition for certiorari, annulled and set aside the RTC decision of November 16, 2010 (Civil Case No. CEB-34459), and declared Section 3(b) of PD No. 198 unconstitutional to the extent that it applies to: (a) highly urbanized cities like the City of Cebu, and (b) component cities whose charters expressly prohibit their voters from voting for provincial elective officials. The Court held that, under the 1987 Constitution and the Local Government Code, such cities are independent of the province; accordingly, the Mayor of the City of Cebu is the appointing authority of the MCWD board members. No pronouncement on costs.

Reasoning on Grave Abuse of Discretion and Political Question Doctrine

The Court found that the RTC gravely abused its discretion in upholding Section 3(b) without reconciling it with the post-1987 legal landscape enshrining local autonomy and the Local Government Code. The RTC’s reliance on the political question doctrine to avoid fuller constitutional analysis was

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