Fundamental Powers of the State

Question 1

What are the fundamental powers of the State?

Answer 1

a. Police power
b. Eminent Domain
c. Taxation

Question 2

What is police power?

Answer 2

It is the inherent and plenary power of the state which enables it to prohibit all that is hurtful to the comfort, safety and welfare of society.

[Ermita-Malate Hotel and Motel Operators Association, Inc. v. Mayor of Manila, G.R. No. L-24693 (1967)]

The police power of the state is a power coextensive with self-protection, and is not inaptly termed the “law of overruling necessity”

[Rubi v. Provincial Board of Mindoro, G.R. No. L-14078 (1919)]

Police power, while incapable of an exact definition, has been purposely veiled in general terms to underscore its comprehensiveness to meet all exigencies and provide enough room for an efficient and flexible response as the conditions warrant”

[White Light Corporation v. City of Manila, G.R. No. 122846 (2009)].

Question 3

Does the constitution define the scope of police power? Why or why not?

Answer 3

As police power derives its existence from the very existence of the State itself, it does not need to be expressed or defined in its scope. XXX So it is that Constitutions do not define the scope or extent of the police power of the State; what they do is to set forth the limitations thereof. The most important of these are the due process clause and the equal protection clause

[Ichong v. Hernandez, G.R. No. L-7995 (1957)].

Police power has been properly characterized as the most essential, insistent, and the least limitable of powers, extending as it does to all the great public needs

[Ermita-Malate Hotel and Motel Operators Ass’n v. City of Manila, supra]

Question 4

What is the general coverage of police power?

Answer 4

The state, in order to promote the general welfare, may interfere with personal liberty, with property, and with business and occupations. Persons may be subjected to all kinds of restraints and burdens, in order to secure the general comfort, health and prosperity of the state and to this fundamental aim of our Government, the rights of the individual are subordinated

[Ortigas and Co., Limited Partnership v. Feati Bank and Trust Co., G.R. No. L-24670 (1979)]

Question 5

What are the implements on police power?

Answer 5

Implements on Police Power

a. Taxation may be used as an implement of police power [Lutz v. Araneta, G.R. No. L-7859 (1955)].
b. Eminent domain may be used as an implement to attain the police objective [Association of Small Landowners v. Secretary of Agrarian Reform, G.R. No. 78742 (1989)].

Question 6

What are the specific coverage of police power?

Answer 6

Specific Coverage

a. Public Health
b. Public Safety
c. Public Morals
d. General Welfare

[Abe v. Foster Wheeler Corporation, G.R. Nos. L-14785 & L-14923 (1960)]

Question 7

Who may exercise police power (generally)?

Answer 7

Legislature

Question 8

Who may exercise police power (delegated)?

Answer 8

Delegated

a. President
b. Administrative Bodies
c. Law-making Bodies of LGU’s

Question 9

Who may exercise police power?

Answer 9

Generally: Legislature

Delegated:

a. President
b. Administrative Bodies
c. Law-making Bodies of LGU’s

Question 10

What are the limitations on delegation of police power?

Answer 10

Limitations on Delegation of Police Power

a. Express grant by law [e.g. Secs. 16, 391, 447, 458 and 468, R.A. 7160, for LGUs]
b. Limited within its territorial jurisdiction [for local government units]
c. Must not be contrary to law.

Question 11

What are the test of valid exercise of police power?

Answer 11

a. Means Purpose Test

1. Lawful means: the means employed are reasonably
   necessary for the
   accomplishment of the purpose and not unduly oppressive upon individuals [Planters Products v. Fertiphil Corporation, G.R. No. 166006 (2008)].
2. Lawful subject: the interests of the public, generally, as distinguished from those of a particular class, require such interference [Ichong v. Hernandez, supra].
   b. Reasonability Test

The limit to police power is reasonability. The Court looks at the test of reasonability to decide whether it encroaches on the right of an individual. So long as legitimate means canreasonably lead to create that end, it is reasonable [Morfe v. Mutuc, G.R. No. L-20387 (1968)].

Question 12

Is legislature’s determination of as to what is a proper exercise of its police power final or conclusive?

Answer 12

NO.

Subject to judicial inquiry Legislature’s determination as to what is a proper exercise of its police powers is not final or conclusive

[US v. Toribio, G.R. No. L-5060 (1910)]

The Court will not inquire into the motives of the Legislature, nor pass upon matters of legislative judgment. It may not annul the legislation if not palpably in excess of legislative power [Ichong v. Hernandez, supra].

Question 13

What is the Eminent Domain?

Answer 13

The right of eminent domain is the ultimate right of the sovereign power to appropriate, not only the public but the private property of all citizens within the territorial sovereignty, to public purpose

[Republic v. Heirs of Borbon, G.R. No. 165354 (2015)]

Question 14

Is the exercise of the right of Eminent Domain unlimited?

Answer 14

NO.

The exercise of such right is not unlimited, for two mandatory requirements should underlie the Government’s exercise of the power of eminent domain, namely:

(1) that it is for a particular public purpose; and
(2) that just compensation be paid to the property owner

[Mactan-Cebu International Airport Authority v. Lozada, Sr., G.R. No. 176625 (2010)]

Question 15

What are the mandatory requirements for the exercise of Eminent Domain?

Answer 15

(1) that it is for a particular public purpose; and
(2) that just compensation be paid to the property owner

[Mactan-Cebu International Airport Authority v. Lozada, Sr., G.R. No. 176625 (2010)].

Question 16

Does eminent domain need to be granted by the fundamental law?

Answer 16

NO.

It is well settled that eminent domain is an inherent
power of the State that need not be granted even by the fundamental law. Sec. 9, Art. III merely imposes a limit on the government’s exercise of this power

[Republic v. Tagle, G.R. No. 129079 (1998)]

Question 17

Who may exercise eminent domain?

Answer 17

Generally: Legislature

Delegated (via charter)

a. LGUs
b. Other Government entities

Question 18

How may eminent domain be delageted?

Answer 18

By law

The repository of eminent domain powers is legislature, i.e. exercised through the enactment of laws. But power may be delegated to LGUs and other government entities (via charter); still, the delegation must be by law

[Manapat v. CA, G.R. No. 110478 (2007)].

Question 19

What are the requisites for the exercise of eminent domain?

Answer 19

a. Necessity - public character

b. Private property
All private property capable of ownership may be expropriated, except money and things in action. It may include services.

c. Taking of property
d. Public use
e. Just Compensation

Question 20

When is the exercise of eminent domain generally justiciable?

Answer 20

It is a political question when power is exercised by Congress, whilst generally justiciable when exercised by a delegate (except when delegation is grant of authority for special purpose).

Question 21

When is there taking of property?

Answer 21

[Republic v. Castellvi, G.R. No. L-20620 (1974)]:

1. the expropriator must enter a private property
2. the entrance into private property must be for more than a momentary period
3. the entry into the property should be under warrant or color of legal authority
4. the property must be devoted to a public use 5. the utilization of the property ousts the owner and deprives him of all beneficial enjoyment of the property

Question 22

What is public use? (re eminent domain)

Answer 22

Public use includes not only use directly available to the public but also those which redound to their indirect benefit

[Heirs of Ardona v. Reyes, G.R. Nos. L-60549, 60553-55 (1983)]

Question 23

What is just compensations (re eminent domain)?

Answer 23

Just compensation is defined as the full and fair equivalent of the property taken from its owner by the expropriator. The measure is not the taker’s gain but the owner’s loss. Without just compensation, expropriation
is not consummated.

Question 24

What is the general rule on when just compensation isdetermined (re eminent domain)? What are the exceptions?

Answer 24

The general rule is that the value of just compensation is determined at the time of the filing of the complaint for expropriation

[Sec 4, Rule 64, ROC].

Exception: At the time of taking, when taking precedes filing of the complaint.

Question 25

Is inflation considered in determining the value of just compensation?

Answer 25

NO.

Inflation will not be considered in determining the value of just compensation

[Nepomuceno v. CA, G.R. No. 166246 (2008)]

Question 26

What is the value of just compensation in eminent domain?

Answer 26

The value is the full and fair equivalent of the property taken; the fair market value of the property.

Question 27

What is the difference bet. eminent domain and regulatory taking?

Answer 27

Eminent domain - is an inherent power of the state based on the Constitution. Just compensation must be paid.

Regulatory taking - is the exercise of the state of its police power. In this case, just compensation need not be paid. Anything taken by virtue of police power is not compensable (e.g. abatement of a nuisance), as usually property condemned under police power is noxious

[DESAMA v. Gozun, G.R. No. 157882 (2006)]

Question 28

Should the government pay just compensation to landowners when it exercises the power of eminent domain in the implementation ot its agrarian reform program?

Answer 28

YES

When the State exercises the power of eminent domain in the implementation of its agrarian reform program, the constitutional provision which governs is Section 4, Article XIII of the Constitution. Notably, this provision also imposes upon the State the obligation of paying the landowner compensation for the land taken, even if it is for the government’s agrarian reform purposes

[Land Bank of the Philippines v. Honeycomb Farms Corporation, G.R. No. 169903 (2012)]

Question 29

What is taxation?

Answer 29

It is the enforced proportional contributions exacted by the State from persons and properties pursuant to its sovereignty in order to support the government and to defray all the public needs

[Mandanas v. Purisima, G.R. No. 199802 (2018)]

Question 30

What is the purpose of taxation?

Answer 30

a. To raise revenue
b. Tool for regulation
c. Protection/power to keep alive

Question 31

What is the scope of taxation?

Answer 31

It is as broad as the purpose for which it is given.

Purpose

a. To raise revenue
b. Tool for regulation
c. Protection/power to keep alive

Question 32

What is the rule for taxes for a special purpose?

Answer 32

Tax for special purpose

Treated as a special fund and paid out for such purpose only; when purpose is fulfilled, the balance, if any shall be transferred to the general funds of the Government

[Sec. 29 (3), Art. VI].

Question 33

When will judicial review lie on legislature’s tax measure?

Answer 33

When the tax measure becomes so unconscionable and unjust as to amount to confiscation of property

The legislature has discretion to determine the nature, object, extent, coverage, and situs of taxation. But where a tax measure becomes so unconscionable and
unjust as to amount to confiscation of property, courts will not hesitate to strike it down; the power to tax cannot override constitutional prescriptions

[Tan v. del Rosario, G.R. No. 109289 (1994)]

Question 34

What are the requisites for the exercise of taxation?

Answer 34

REQUISITES
[Sec. 28(1), Art. VI]

a. uniform and equitable
b. progressive system of taxation

c. delegated tax legislation
Congress may delegate law-making authority when the Constitution itself specifically authorizes it

Question 35

When is taxation UNIFORM?

Answer 35

persons or things belonging to the same class shall be taxed at the same rate

Question 36

When is taxation EQUITABLE?

Answer 36

taxes should be apportioned among the people according to their ability to pay

Question 37

What does a progressive system of taxation entail?

Answer 37

The rate increases as the tax base increases, with social justice as basis (Taxation here is an instrument for a more equitable distribution of wealth).

Question 38

When may Congress delegate law-making authority?

Answer 38

Congress may delegate law-making authority when the Constitution itself specifically authorizes it.

Question 39

What are the general limitations to taxation?

Answer 39

a. Power to tax exists for the general welfare; should be exercised only for a public purpose

b. Might be justified as for public purpose even if the immediate beneficiaries
are private individuals

c. Tax should not be confiscatory: If a tax measure is so unconscionable as to amount to confiscation of property, the Court will invalidate it. But invalidating a tax measure must be exercised with utmost caution, otherwise, the State’s power to legislate for the public welfare might be seriously curtailed
d. Taxes should be uniform and equitable

Question 40

What are the specific limitations on taxation?

Answer 40

a. Uniformity of taxation

General Rule: Simply geographical uniformity, meaning it operates with the same force and effect in every place where the subject of it is found Exception: Rule does not prohibit classification for purposes of taxation, provided the requisites for valid classification are met [Ormoc Sugar v. Treasurer of Ormoc, G.R. No. L23793 (1968)].

b. Tax Exemptions

No law granting any tax exemption shall be passed without the concurrence of a majority of all the Members of Congress [Sec. 28 (4), Art. VI].

Question 41

What is the general rule on the uniformity of taxation?

Answer 41

General Rule:

Simply geographical uniformity, meaning it operates with the same force and effect in every place where the subject of it is found

Question 42

What is the exception to the general rule on taxation?

Answer 42

No law granting any tax exemption shall be passed without the concurrence of a majority of all the Members of Congress

[Sec. 28 (4), Art. VI]

Question 43

What is the rule on tax exemptions?

Answer 43

No law granting any tax exemption shall be passed without the concurrence of a majority of all the Members of Congress

[Sec. 28 (4), Art. VI]

Question 44

Is there a vested right in a tax exemption?

Answer 44

NO.

There is no vested right in a tax exemption. Being a mere statutory privilege, a tax exemption may be modified or withdrawn at will by the granting authority [Republic v. Caguioa, G.R. No. 168584 (2007)].

Question 45

What are the types of tax exemptions?

Answer 45

Exemptions may either be constitutional or statutory:

1. Constitutional exemptions [Sec. 28(3), Art. VI]
2. If statutory, it has to have been passed by majority of all the members of Congress [Sec. 28 (4), Art. VI]

[Sec. 28(3), Art. VI]
(3) Charitable institutions, churches and parsonages or convents appurtenant thereto, mosques, non-profit cemeteries, and all lands, buildings, and improvements, actually, directly, and exclusively used for religious, charitable, or educational purposes shall be exempt from taxation.

[Sec. 28 (4), Art. VI]
(4) No law granting any tax exemption shall be passed without the concurrence of a majority of all the Members of the Congress.