View full case

MAYOR PABLO P. MAGTAJAS v. PRYCE PROPERTIES CORPORATION

FACTS:

PAGCOR announced its plan to open a casino in Cagayan de Oro City, which faced opposition from various groups and individuals. Demonstrations against the casino were held, and the local government enacted ordinances prohibiting the operation of a casino in the city and imposing penalties for violations. Pryce, with PAGCOR as intervenor, challenged these ordinances before the Court of Appeals, which declared them invalid. The city and its mayor filed a petition for review before the Supreme Court.

The petitioners argue that the local government has the authority to prohibit the operation of casinos in Cagayan de Oro City based on the Local Government Code. They contend that the Code grants local government units the power to prevent or suppress all forms of gambling, including casinos. They assert that the Code authorizes local government units to enact ordinances to prevent and suppress gambling, including the establishment of casinos.

The petitioners argue that the Code's authority given to local government units to regulate properties and businesses within their territorial limits includes the power to prohibit the operation of casinos. They claim that the Code's authorization to prevent and suppress gambling encompasses all forms of gambling without distinction.

The petitioners also argue that the Local Government Code prevails over Presidential Decree (P.D.) 1869, which grants powers to PAGCOR, in case of inconsistencies between the two laws. They assert that the powers of PAGCOR granted under P.D. 1869 are discontinued by the Code to the extent that they do not conform to its philosophy and provisions.

Overall, the petitioners argue that the interpretation of the Local Government Code supports the policy of local autonomy and the competence of local government units to adopt measures that promote the general welfare of their inhabitants. They contend that local government units are permitted to prohibit all kinds of gambling, including the operation of casinos, within their territories.

ISSUES:

  1. Whether the Local Government Code repealed or modified Presidential Decree (P.D.) No. 1869.

  2. Whether the ordinances enacted by the Sangguniang Panlungsod of Cagayan de Oro City contravene the provisions of P.D. No. 1869.

RULING:

  1. The Court held that the Local Government Code did not repeal or modify P.D. No. 1869. There is no express provision in the Code that repeals or modifies P.D. No. 1869. Furthermore, any doubt regarding the effect of the Code on P.D. No. 1869 should be resolved in favor of the petitioners, in accordance with the Code's directive to interpret provisions in favor of devolution of powers and the lower local government unit.

  2. The Court ruled that the ordinances enacted by the Sangguniang Panlungsod of Cagayan de Oro City contravene the provisions of P.D. No. 1869 and the public policy embodied therein. The ordinances prevented the Philippine Amusement and Gaming Corporation (PAGCOR) from exercising its power to operate a casino in Cagayan de Oro City. The Court held that the ordinances were invalid as they contravened a valid law and public policy.

PRINCIPLES:

  • The morality of gambling is not a justiciable issue. Gambling is not illegal per se and it is left to Congress to decide on its regulation or prohibition.

  • The wisdom, morality, or practicability of statutes are not within the judiciary's authority to review or reverse. Such matters are resolved by the legislative and executive branches.

  • The validity of an ordinance is determined by whether it conforms to the Constitution, statutes, fairness, non-oppressiveness, non-discrimination, regulation rather than prohibition of trade, consistency with public policy, and reasonableness.

  • The interpretation of a word or phrase in a statute should be done in relation to, or given the same meaning as, words with which it is associated.

  • A law cannot be deemed repealed unless there is a clear and unmistakable showing of the intention to do so.

  • Implied repeals are not lightly presumed, especially when the two statutes in question bear a relation of general to special.

  • When there is a conflict between statutes, courts must exert every effort to reconcile them and give effect to both, as they are the handiwork of a coordinate branch of the government.

  • Municipal governments are agents of the national government and exercise delegated legislative powers. They cannot exercise powers higher than those of the national legislature.

  • Municipal corporations derive their powers and rights wholly from the legislature. They exist at the will of the legislature and can be abolished by it.

  • Congress retains control over the local government units, although in reduced degree under the Constitution's policy of local autonomy. The power to create includes the power to destroy, and the power to grant includes the power to withhold or recall.

  • The Constitution is the touchstone of all official acts. The power of the legislature to legalize certain forms of gambling can only be revoked if it contravenes the Constitution.

  • P.D. 1869, which authorizes casino gambling, has the status of a statute that cannot be amended or nullified by a mere ordinance. Municipal ordinances can only prevent or suppress forms of gambling prohibited by law.