37600946 public corporations law 2 memory aid

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ZPG & ASSOCIATES(Zambales.Pablo.Gonzales)

LAW ON PUBLICCORPORATIONS

A. General Principles

1. CORPORATIONan artificial beingcreated by operation of law, having theright of succession and the powers,attributes and properties expresslyauthorized by law or incident to itsexistence.a. PUBLIC CORPORATIONoneformed and organized for thegovernment of a portion of the State.

2. Classes of Corporation:

a. Public or Municipalabody politic and corporateconstituted by incorporationof inhabitants of city ortown for purposes of localgovernment thereof or asagency of State to assist incivil government of thecountry; one formed andorganized for thegovernment of a portion ofthe State.

b.Privateone formed forsome private purpose,benefit, aim or end.

c. Quasi-Publica privatecorporation that renderspublic service or suppliespublic wants.

d. Quasi-corporationpubliccorporations created asagencies of State for narrowand limited purpose.

3. Elements of Municipal

Corporationa. Legal creation or

incorporationb. Corporate namec. Inhabitantsd. Territory

4. Dual Nature of MunicipalCorporation

Every local government unitcreated or organized is a body politicand corporate endowed with powers tobe exercised by it in conformity with

law. As such, it shall exercise powersas political subdivision of the NationalGovernment and as a corporate entityrepresenting the inhabitants of itsterritory.

a. Public/Governmentalitacts as an agent of theState for the government ofthe territory and theinhabitants within the

municipal limits; it exercisesby delegation a part of thesovereignty of the State.

b. Private/Proprietaryitacts in a similar category asa business corporation,performing functions notstrictly governmental orpolitical; it stands for thecommunity in theadministration of localaffairs. It acts as a separateentity for its own purposesand not as a subdivision ofthe State.

5. Criterion to determine whethercorporation is public:

The relationship of thecorporation to the State, i.e., if createdby the State as its own agency to helpthe State in carrying out itsgovernmental functions, then it ispublic, otherwise, it is private.

6. De Facto Municipal Corporation--a corporation that may exist in

fact although not point of law becauseof certain defects in some essentialfeatures of its incorporation.

7. Elements of De Facto MunicipalCorporation:

a. A valid law authorizingincorporation

b. An attempt in good faith toorganize under it

c. A colorable compliance withthe law

d. An assumption of corporatepowers

8. Three forms of decentralization:

a. Devolution- is thetransfer of power and authority

from the national governmentto LGUs as the territorial andpolitical subdivisions of theState. The nature of powertransfer is political and theapproach is territorial or areal.

b. Deconcentration-is the transfer of power,authority or responsibility, orthe discretion to plan, decideand manage from central pointor local levels, but within thecentral or national governmentitself. The nature of thetransfer is administrative andthe approach is sectoral.

c. Debureaucratization- is the transfer of somepublic functions andresponsibilities, which thegovernment may perform, toprivate entities or non-

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governmental organizations; itis peoples empowerment orparticipation in localgovernance.

Decentralization of Administration- the central

government delegates administrativepowers to political subdivisions inorder to broaden the base ofgovernment power.

Decentralization of Power(Political Decentralization)-involves abdication of political powerin favor of LGUs declaredautonomous. (Limbonas vs.Mangelin, 170 SCRA 786)

NOTE:

Local Autonomy- is self-governing. It is the granting of morepowers, authority, responsibilities andresources to the lower or local levels ofa government system. The principle oflocal autonomy under the 1987Constitution simply meansdecentralization. It does not make thelocal government sovereign within thestate or an imperium in imperio.

Among the regulatory powers of theNational Government Agencies transferred ordevolved to the LGUs include the following:

1. The reclassification of agricultural lands- DAR to cities andmunicipalities2. Enforcement of environmentallaws- DENR to all LGUs3. Inspection of food products andquarantine- DOH to cities and

municipalities4. The enforcement of theNational Building Code- DPWH to citiesand municipalities5. The processing and approval ofsubdivision plans- HLURB to cities andmunicipalities6. The operation of tricycles-LTFRB to cities and municipalities7. The establishment of cockpitsand holding of cockfights- PhilippineGamefowl Commission to cities andmunicipalities

Among the basic services andfacilities devolved to LGUs include:

1. Agricultural extension and on-site research of the Department ofAgriculture;2. Community-based forestryproject of the DENR;

3. Field health and hospitalservices and other tertiary healthservices of the DOH;4. Public works and infrastructureprojects funded out of local funds ofthe DPWH;5. The school building program of

the DECS;6. Social welfare services of theDSWD;7. Tourism facilities and tourismpromotion and development of theDOT;8. Telecommunications servicesfor provinces and cities of the DOTC;9. Housing projects for provincesand cities; and10. Other services such asinvestment support.

9. How local autonomy enhancesgovernmental and corporate powers ofLGUs:

a. Every local government unit shall

have:i. Full autonomy in their exerciseof proprietary rights andmanagement of economicenterprises.ii. Full authority to securedomestic or foreign grants withoutthe approval of the NGAs

concerned, unless these areprojects with national securityimplications, andiii. Financial undertakings for LGUsfor mutual advantage thru loansand assistance to calamity-strickenLGUs.

B. R.A. 7160Policy and Application;Constitutional Provisions

1. EffectivityJanuary 1, 1992

2. Scope of Application (Sec. 4,RA 7160)Applicable to:

a. all provincesb. citiesc. municipalitiesd. barangayse. and other political

bodies as may becreated by law, and

f. to the extent providedin the LGC (i.e.devolution of powers):

-officials-offices, or-agencies of theNationalGovernment

3. Rules of Interpretation (Sec.5, RA 7160)a. Any provision on a localgovernment unit shall be

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liberally interpreted itsfavor, and in case of doubt, anyquestion thereon shall beresolved in favor of devolutionof powers and of the lower localgovernment unit. Any fair andreasonable doubt as to the

existence of the power shall beinterpreted in favor of the localgovernment unit concerned;

b. In case of doubt, any taxordinance or revenue measureshall be construed strictlyagainst the local govt unitenacting it, and liberally infavor of the taxpayer. Any taxexemption, incentive or reliefgranted by any local govt unitpursuant to the provisions of

this Code shall be construedstrictly against the personclaiming it;

c. The general welfareprovisions in this Code shallbe liberally interpreted togive more powers to localgovt units in acceleratingeconomic development andupgrading the quality of lifefor the people in thecommunity.

d. Rights and obligationsexisting on the date ofeffectivity of this Code andarising out of contracts orany other source of prestation involving a localgovt unit shall be governedby the original terms andconditions of said contractsor the law in force at thetime such rights werevested.

e. In the resolution of controversies arising underthis Code where no legalprovision or jurisprudenceapplies, resort may be hadto the customs andtraditions in the place wherethe controversies takeplace.

4. Declaration of State Policyover LGUs (Sec. 2, RA 7160)

a. The territorial andpolitical subdivisions ofthe State shall enjoygenuine andmeaningful localautonomy to enablethem to attain theirfullest development asself-reliant

communications andmake them moreeffective partners inthe attainment ofnational goals.

b. To ensure theaccountability of local

govt units through theinstitution of effectivemechanisms of recall,initiative andreferendum.

c. To require all nationalagencies and offices toconduct periodicconsultations withappropriate local govtunits, non-governmental andpeoples organizations

and other concernedsectors of thecommunity before anyproject or program isimplemented in theirrespective

jurisdictions.

II. INTER-GOVERNMENTAL RELATIONS1. National Government and Local

Government Units

a. The President shall exercise generalsupervision over LGUs.

i. The President shall exercisesupervisory authoritydirectly over provinces,highly urbanized cities andindependent componentcities.

ii. The President shall exercisesupervision over componentcities and municipalities,through province, and overbarangays through city and

municipality. (Sec. 25)

The Presidents power ofgeneral supervision overLGUs includes the authorityto investigate and imposedisciplinary measures(suspension or removal)upon elective local officials.

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b. General responsibilities of theNational Government towards LGUs:

i. formulate policies and set

standards and guidelinesii. provide funding supportiii. augment basic services

assigned to LGUsiv. provide technical and other

forms of assistance andcoordinate on the dischargeof NGA functions

v. ensure the participation of LGUs in planning andimplementing nationalprojects

vi. conduct mandatory

consultations with LGUs

NOTE:No project shall be implemented by

government authorities without consultationwith the local government units and priorapproval of the Sanggunian concerned.(Sec.27)

The requirement of prior consultationapplies only to national projects and/orprograms which are to be implemented in aparticular local community. Although

sanctioned by the national government, theoperation of lotto is neither a program norproject of the national government but ofcharitable institution, the Philippine CharitySweepstakes Office. The projects andprograms mentioned in Sec. 27 should beinterpreted to mean projects and programswhose environmental and ecological effectsare among those mentioned in Sec. 26 and 27of the LGC (Lina vs. Pano, G.R. No. 129093,

August 30, 2001).

c. Extent of the LCEs authority

over NGAs and their functionaries:

i. The LCE can call upon anyemployee stationed or assignedin his locality toadvise him on matters affectingthe LGU as well as coordinatewith said officials, plans,programs and projects.

ii. The LCE can enlist theattendance of the nationalofficial stationed in the LGU ona meeting of elective and

appointed officials of the LGUtreating matters in thepromotion of the generalwelfare of the residents.

iii. The LCE can also initiate properadministrative or judicial action against nationalgovernment official or employee who may havecommitted an offense while stationed orassigned in the LGU.

BasisPower ofControl

Power ofGeneral

Supervision

A. as tonature of

powerLegislative Executive

B. as towho

exercisesthe

power

Congress

Presidentassisted bythe DILGSecretary

C. as towhat the

powerincludes

-creation,conversionof LGUs andalteration of

itsboundaries;

-allocatepowers,

responsibilities and

resourcesamongLGUs;

-provide forqualifications, election,

appointment, removal,

term,salaries and

functions

and duties oflocal

officials;-provide

othermatters

relating tothe

organizationand

operation ofLGUs;

-amendment

of chartersof LGUs.

-overseewhetherLGUs are

performingtheir

duties inaccordance with law;

-investigate

andimpose

disciplinar

ymeasuresuponerring

electivelocal

government officials

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Power of Control and Power ofGeneral

Supervision distinguished:

2. Inter-Local Government Relations

a. The province, through the governor,shall ensure that every component city andmunicipality acts within its powers.

b. The city or municipality, through the

mayor, shall ensure that barangays actwithin the scope of their powers.

c. The governor shall review all executiveorders promulgated by the mayor. Themayor shall review orders promulgatedby the punong barangay.

The Sangguniang Panlalawigan of a

province reviews all ordinances enacted bythe Sangguniang Panlungsod of componentcities and Sangguniang Bayan of municipalities under their jurisdiction. In turn,the Sangguniang Panlungsod andSangguniang Bayan review all ordinancespassed by the Sannguniang Barangay underthe jurisdiction.

Likewise, the SangguniangPanlalawigan of a province exercises thequasi-judicial function (administrativedisciplinary authority) of hearing and decidingadministrative cases involving elective

municipal and component city officials undertheir jurisdiction. In turn, the SangguniangPanlungsod and Sangguniang Bayan exercisedisciplinary authority over elective barangayofficials within their jurisdiction.

3. Relations with Peoples Organizationsand Non-Government Organizations

a. Private Sector Participation in LocalGovernance

Purpose: to ensure the viability of localautonomy as an alternative strategy for

sustainable development. LGUs shallencourage private-sector participationin the delivery of basic services.

b. Role of POs, NGOs in the LGUs:LGUs shall promote the establishmentand operation of peoples and non-governmental organizations as activepartners.

LGUs may enter into joint venture and

cooperative undertakings with peoples andnon-governmental organizationsparticularly in the following:

1. delivery of certain basicservices2. capability building andlivelihood projects; and3. developing local enterprisesdesigned to improve productivity and income,diversifies agriculture, spur ruralindustrialization, and enhance the economicand social well-being of the people.

c. Special Local Bodies where theprivate sector may participate in localgovernance:

1. Local Development Council-a duly constituted body which shall

assist the corresponding Sanggunian insetting the direction of economic andsocial development, and coordinating

development efforts in its territorialjurisdiction.

2. Prequalification, Bids andAwards Committee (PBAC)

responsible for the conduct ofprequalification of contractors, bidding,evaluation of bids, and therecommendation of awards concerninglocal infrastructure projects.

governor or the city ormunicipality mayor: Chairman

3. Local Peace and Order Council,pursuant to E.O. No.309, asamended, Series of 1988.

4. Local School BoardThe DECS shall consult the Board

on the appointment of divisionsuperintendents, district supervisors,school principals, and other schoolofficials.

5. Local Health Board

6. Peoples Law Enforcement Board(PLEB)

III. CREATION, CONVERSION, DIVISION,MERGER AND CONSOLIDATION, ANDABOLITION OF LGUs

A. Creation of LGUs:A local government unit may be

created, divided, merged, abolished, or itsboundaries substantially altered by lawenacted by Congress in the case of aprovince, city, municipality, or other political

subdivisions, or by SanggunianPanlalawigan or Sanggunian Panlungsodordinance in the case of a barangay. (Sec.6)NOTE:nature of the power to create:LEGISLATIVE

1. While the power to create barangays hasbeen delegated to Sanggunian Panlalawigan

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and Sangguniang Panlungsod, Congress, inorder to enhance the delivery of basicservices in indigenous cultural communities,may create barangays in such communitiesnotwithstanding the requirements set forthby law. (Sec.385a, LGC)

2. The creation or conversion of a localgovernment unit to another level shall bebased on the following verifiable indicatorsof viability and projected capacity to provideservices:

a. Sufficient income andb. Population and/orc. Land area

NOTE: Compliance with the above-citedindicators shall be attested by theDepartment of Finance, the NationalStatistics Office and the Land Management

Bureau of the DENR, respectively.

3. Necessity of Fixing CorporateLimits: As a matter of general rule, municipalcorporations cannot, without legalauthorization, exercise its powers beyond itsown corporate limits. It is necessary that itmust have its boundaries fixed, definite andcertain, in order that may be identified andthat all may know the exact scope orsection of territory or geographical divisionembraced within the corporate limits and

over which the municipal corporation hasjurisdiction. A description of the boundariesof a municipal corporation is said to be anessential part of its charter and necessary tocorporate existence. An incorporation isvoid where the boundaries of the municipalcorporation are not described with certainty.

4. Manner of Creation1. Creation of Barangays:

a. Role: serves as the primaryplanning and implementing unit ofgovernment policies, plans programs,

projects and activities in the community,and as a forum wherein the collective viewsof the people may be expressed, crystallizedand considered, and where disputes may beamicably settled.

b. Who creates: a barangay maybe created, divided, merged, abolished orits boundary substantially altered by law orby an ordinance of the SangguniangPanlalawigan or Sangguniang Panlungsod.Where a barangay is created by anordinance of the Sangguniang Panlalawigan,

the recommendation of the SangguniangBayan concerned shall be necessary.

c. Substantive Requisites:1. Population- at least 2000

inhabitantsExcept in cities and

municipalities within Metro Manila orin highly urbanized citiesmust beat least 5000 inhabitants

2. Income- no minimum incomerequirement

3. Land Area- no minimumrequirement, but it must becontiguous but it need not be

contiguous if the barangay iscomprised with two or moreislands.

NOTE:The creation of the new barangay shall nothowever reduce the population of theoriginal barangay to less than the minimumrequirement prescribed in the Code.(Sec.386, LGC)

2. Creation of Municipalities a. Role: serves primarily as a general

purpose government for the coordinationand delivery of basic, regular and directservices and effective governance of theinhabitants within its territorial jurisdiction.

b. Who creates: may be created,divided, merged, abolished or its boundarysubstantially altered only by an act ofCongress subject to the criteria establishedby the Code.

c. Substantive Requisites:1. Population- at least 25,000

inhabitants2. Income- average annual income

of at least P2.5 million for thelast two consecutive years basedon the 1991 constant prices.

3. Land Area- a contiguous territoryof 50 square kilometers.

3. Creation of Component Citiesa. Role- serves primarily as a

general purpose government for thecoordination and delivery of basic, regularand direct services and effective

governance of the inhabitants within itsterritorial jurisdiction.

b. Who creates- may be created,

divided, merged or abolished, or itsboundary substantially altered only by anact of Congress subject to the criteriaprovided in the Code.

c. Substantive Requisites:1. Population- at least 150,000

inhabitants2. Income- at least P100 million for

the last two consecutive years3. Land Area- contiguous territory

of at least 100 squarekilometers

NOTE: The Internal Revenue Allotmentsshall be included in the computation of theaverage annual income of the municipalityfor purposes of determining whether the

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municipality may be validly converted into acity. Income is defined in the LGC to be allrevenues and receipts collected or receivedforming the gross accretions of funds of thelocal government unit. The IRAs are regularand recurring income and not merelyspecial funds or transfers and/or budgetary

aids from the national government or non-recurring income. The IRAs regularly andautomatically accrue to the local treasurywithout need of any further action on thepart of the local government unit (Alvarezvs. Guingona, 252 SCRA 695).

4. Conversion of a Component City intoa Highly Urbanized City

a. If a component city shall have metthe minimum requirements for a highlyurbanized city, it shall be the duty of thePresident to declare the city as highly

urbanized city upon: (1) proper applicationand (2) upon ratification in a plebiscite bythe majority of registered voters therein.

b. Substantive Requisites:1. Population- at least 200,000

inhabitants2. Income- at least P50 million

5. Creation of Provincesa. Role- as a political and corporate

unit of government, it serves as a dynamicmechanism for development processes and

effective governance of local governmentunits within its territorial jurisdiction.

b. Who creates- may be created,divided, merged, or abolished, or itsboundary substantially altered, only by anact of Congress, subject to the satisfactionof the criteria set forth by the LGC.

c. Substantive Requirements:1. Population- not less than

250,000 inhabitants2. Income- average annual income

of at least P20 million3. Land Area- a contiguous territory

of at least 2000 squarekilometers

NOTE:BP 885, which created the Province

of Negros del Norte was declaredunconstitutional because it did not complywith the land area criterion prescribed underthe LGC. The use of the word territory inSec. 17 of the LGC refers only to thephysical mass of land area, not to the

waters comprising a political entity. Itexcludes the waters over which the politicalunit exercises control (Tan vs. Comelec,142 SCRA 727).

6. Status of Sub-provinces Existing sub-provinces are convertedinto regular provinces upon the approval bya majority votes cast in a plebiscite to beheld in the said sub-province and the

original province directly affected. (Sec.462,LGC)

7. Autonomous RegionsThe Philippine Constitution mandates

the creation of autonomous regions inMuslim Mindanao and in the Cordilleras

consisting of provinces, cities,municipalities, and geographical areassharing common and distinctive historicaland cultural heritage, and economic andsocial cultures. (Sec.15, Art.10, PC)NOTE:

RA 6734, the organic actestablishing the Autonomous RegionalGovernment of Muslim Mindanao was heldvalid by the Supreme Court. (DatuFirdausi Abbas vs. COMELEC, 179 SCRA287). However, the sole Province of Ifugao

which, in the plebiscite, alone voted in favorof RA 6766, cannot validly constitute theAutonomous Region of the Cordilleras.(Ordillo vs. COMELEC, 192 SCRA 100)

8. Special Metropolitan PoliticalSubdivisions

The Congress may, by law, createspecial metropolitan political subdivisions,but the component cities and municipalitiesshall retain their basic autonomy and shallbe entitled to their own local executives andlegislative assemblies. The jurisdiction of

the metropolitan authority that will bethereby created shall be limited to basicservices requiring coordination. (Sec. 11,Art. X, PC)

NOTE:With the passage of RA 7924,

Metropolitan Manila was declared as aspecial development and administrativeregion and the administration ofmetrowide basic services affecting theregion was placed under a developmentauthority referred to as the Metropolitan

Manila Development Authority (MMDA),whose functions were without prejudice tothe autonomy of the affected localgovernment units. The law does not grantpolice nor legislative powers to MMDA.Even the Metro Manila Council, thegoverning board of the MMDA, has not beendelegated any legislative power. Clearly,MMDA is not a political unit. There is nogrant of authority to enact ordinances andregulations for the general welfare of theinhabitants of the metropolis. MMDA cannotopen for public use a private road in a

private subdivision (MMDA vs. Bel-AirVillage Association, Inc., G.R. No.135962, March 27, 2000).

9. Attack against invalidity ofincorporation

No collateral attack shall lie; aninquiry into the legal existence of amunicipal corporation is reserved to theState in a proceeding for quo warranto or

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other direct proceeding. But this ruleapplies only when the municipal corporationis, at least, a de facto municipal corporation.

10. PLEBISCITE REQUIREMENT: Whoshall participate

Sec. 10 of the LGC provides that the

creation, division and merger, abolition orsubstantial alteration of the boundaries oflocal government units must be approvedby a majority of votes cast in a plebiscite inthe political unit or units directly affected.Such plebiscite shall be conducted by theCOMELEC within 120 days from the date ofthe effectivity of the law. The completion ofthe publication of the law should be thereckoning point in determining the 120-dayperiod within which to conduct theplebiscite, not from the date of its approvalwhen the law had not yet been published.

Since publication is indispensable for theeffectivity of a law, a plebiscite can bescheduled only after the law creating a citytook effect. (Cawaling vs. COMELEC, Oct.26, 2002)

The plebiscite for the creation of anew province or municipality shall includethe participation of the residents of themother province or mother municipality inorder to conform to the constitutionalrequirement. (Padilla vs. COMELEC, 214SCRA 735)

In the conversion of a municipalityinto a component city, however, only theregistered voters of the municipality soughtto be converted into a component city, shallparticipate in the plebiscite.

Summary of Substantive Requirementsin the Creation of LGUs

LGUCreated

IncomePopulati

onLandarea

Barangay

Nominimumrequirem

ent

2,000but

5,000for

MetroManila

andhighly

urbanized cities

Nominimumrequirem

ent

Municipality

P2.5million

25,000,and

50 sq.km

Component City

P100million

150,000or

100sq.km.

HighlyUrbanize

d City

P50million

200,000

No

minimumrequirem

ent

ProvinceP20

million250,000

or2,000sq.km.

11. Beginning of Corporate ExistenceWhen a new local government unit is

created, its corporate existence shallcommence upon the election and

qualification of its chief executive and amajority members of the Sanggunian,unless some other date is fixed therefore bylaw or ordinance creating it. (Sec.14, LGC)

12. Division and Merger of LGUsThe division and merger of local

government units shall comply with thesame requirements for their creation. Theincome, population or land area shall not bereduced to less than the minimumrequirements. Likewise, the incomeclassification of the original localgovernment unit shall not fall below itscurrent income classification prior to suchdivision. (Sec.8, LGC)

13. Abolition of LGUsA local government unit may be

abolished when its income, population or

land area has been irreversibly reduced toless than the minimum standards prescribedfor its creation under the LGC, as certifiedby the national agencies to Congress or tothe Sanggunian concerned. Likewise, thelaw or, ordinance abolishing an LGU shallspecify the province, city, municipality, orbarangay with which the local governmentunit sought to be abolished will beincorporated or merged. (Sec.9, LGC)

14. Effects of Annexation/Consolidation of Municipal

Corporations1. On the legal existence of the

territory annexed- Unlessotherwise provided for by law,the annexation of one municipalcorporation to another willdissolve the annexed territory. Itshall become part of theannexing corporation and will fallunder the jurisdiction of thelatter.

2. On the laws and ordinances ofthe annexed corporation- In the

absence of any provision of lawto the contrary, when a territoryis annexed to a municipalcorporation, it shall becomesubject to all the laws andordinances by which theannexing corporation isgoverned.

3. On the right of officers oremployees of the annexed orconsolidated territory to continueto hold their offices- Subject towhat the legislature may provide

upon annexation, the officersand employees of the annexedor consolidated territory shallterminate their official relationwith their offices.

4. On the title to the property of theannexed territory- When amunicipal corporation is annexedto another, the annexingterritory shall acquire title to the

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property of the annexed territoryat the time of annexationwithout compensation unless theannexing statute providesotherwise. Where the annexedterritory, however, forms part ofa municipality from which it is

taken, the legislature mayprovide for the payment ofcompensation for theindebtedness incurred onaccount of the property taken.

With regard to publicbuildings and improvementslocated in the annexedterritory, the annexing territoryis not required to pay for saidbuildings or improvements asthey have already been paid forby the annexed territory. It

would be otherwise if thereexists an indebtedness on saidbuildings in which case, theannexing state may be requiredto share in the payment of saidindebtedness.

5. On the debts and obligations ofthe annexed territory- It hasbeen stated that debts andobligations of a municipalcorporation contracted before itsannexation to another territoryshall be assumed by the

annexing territory in the absenceof any provision to the contrary.

The same rule applies ofconsolidation where theconsolidating municipalcorporation is held responsiblefor the indebtedness andobligations incurred by theterritories which areconsolidated.

15. Effects of Division of LGUsOn the legal existence of the original

corporation: The division of municipalcorporation extinguishes the corporateexistence of the original municipality.

On the property, powers and rightsof the original corporation: Unless the lawprovides otherwise, when a municipalcorporation is divided into two or moremunicipalities, each municipality acquirestitle to all the property, powers, rights andobligations falling within its territorial

jurisdiction.

IV. GENERAL POWERS AND ATTRIBUTESOF LGUsA. Powers in general

1. Sources:a. Sec. 25, Art II: Secs. 5,6 and 7, Art. X,

Philippine Constitutionb. Statutes, e.g., R.A. 7160c. Charter (particularly of cities)

d. Doctrine of the right of self-government, but applies only in Stateswhich adhere to the doctrine.

2. Classifications:a. Express, implied and inherent

b. Public or governmental, private orproprietary

c. Intramural or extramurald. Mandatory and directory, ministerial

and discretionary

3. Execution of powers:a. Where the statute prescribes the

manner of exercise, the procedure must befollowed.

b. Where the statute is silent, localgovernment units have discretion to selectreasonable means and methods of exercise.

B. GOVERNMENTAL POWERS:1. General Welfare Clause- the statutorygrant of police power to local governmentunits.Limitations:a. Express grant by lawb. Exercisable only within the territoriallimits of the LGU, except for protection ofwater supplyc. Equal protection claused. Due process clausee. Must not be contrary to the Constitution

and the laws.

NOTE:A local government unit may

exercise delegated governmental powers:Police power (under the General WelfareClause) Power of Taxation Power of Eminent Domain

a. Requisites for the validity of amunicipal ordinance:

1. Must not contravene the Constitution

and any statute;2. Must not be unfair or oppressive;3. Must not be partial or discriminatory;4. Must not prohibit, but may regulate

trade which is not illegal per se;5. Must not be unreasonable; and6. Must be general in application and

consistent with public policy.

An ordinance extending burialassistance of P500 to a bereaved familywhose gross income does not exceedP2,000 a month, has been upheld by the

Supreme Court as a valid exercise of policepower. This power is organic and flexible.

The care for the poor is generallyrecognized as a public duty. The support forthe poor has long been an acceptedexercise of police power in the promotion ofcommon good. The police power of amunicipal corporation is broad andcommensurate with the duty to provide forthe real needs of the people in their health,

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safety, comfort, and convenience asconsistently as may be with private rights.It extends to all the great public needs andin a broad sense includes all legislation andalmost every function of the municipalgovernment. (Binay vs. Domingo, 201SCRA 508)

2. Basic Services and Facilities:17, LGC(a) Local government units

shall endeavor to be self-reliant and shallcontinue exercising the powers anddischarging the duties and functionscurrently vested upon them. They shall alsodischarge the functions and responsibilitiesof national agencies and offices devolved tothem pursuant to this Code. Localgovernment units shall likewise exercisesuch other powers and discharge such other

functions and responsibilities as arenecessary, appropriate, or incidental toefficient and effective provision of the basicservices and facilities enumerated under theCode.

Devolution refers to the act by which thenational government confers powers andauthority upon the various local governmentunits to perform specific functions andresponsibilities. This includes the transferto the local government units of the records,equipment and other assets and personnel

of national agencies and offices.

3. Power to generate and applyresources (18, LGC)

The exercise by local governments ofthe power to tax is ordained by the presentConstitution (5, Art. X, Phil. Constitution).Only guidelines and limitations that may beestablished by Congress can define andlimit such power of local governments. Butlocal governments have no power to taxinstrumentalities of the NationalGovernment. PAGCOR being an

instrumentality of the National Governmentis therefore exempt from local taxes.(Basco vs. PAGCOR, 197 SCRA 52)

Main Sources of Revenues of LGUsA. Under the Constitution

1. taxes, fees and charges (5,Art. X)

2. share in the national taxes-Internal Revenue Allotment

3. share in the proceeds of theutilization and developmentof the national wealth within

their areas (7, Art. X)B. Under the Local Government Code

1. floating of bonds2. grants/aids

All LGUs are empowered to create theirown sources of revenue and to levy taxes,fees and charges subject to the provisionson local taxation consistent with the basicpolicy of local autonomy. The Sanggunian

concerned through an ordinance has thepower to impose a tax, fee or charge. Theprocedural requirements of public hearingand publication must be observed forpurposes of compliance with therequirements of due process.

C. Fundamental Principles on Localtaxation

1. Taxation shall be uniform in eachlocal government unit;

2. Taxes, fees, charges and otherimpositions shall:

a. be equitable and based as far aspracticable on the taxpayers abilityto pay;

b. be levied and collected only forpublic purposes;

c. not be unjust, excessive, oppressiveor confiscatory;

d. not be contrary to law, public policy,national economic policy, or inrestraint of trade.

3. The collection of taxes, fees, chargesand other impositions shall in nocase be let to any private persons;

4. The revenue collected pursuant tothe provisions of the LGC shall inuresolely to the benefit of, and besubject to disposition by, the localgovernment unit levying the tax, fee,charge or other imposition unlessotherwise specifically provided

herein; and5. Each local government unit shall, as

far as practicable, evolve aprogressive system of taxation.

NOTES:Shares of LGUs in the proceeds ofnational taxes

The share of the LGU in InternalRevenue Taxes is 40%. The 40% IRA isallocated to LGUs as follows: for provincesand cities- 23%; for municipalities- 34%; forbarangays- 20%.

No less than 20% of the IRA isallotted for development project by the localunit from the IRA.

Shares in National Wealth40% of the gross collection from

mining taxes, royalties, forestry and fisherycharges, and from each share in any jointeffort in utilizing and developing thenational wealth within the LGUs jurisdictionand shall be remitted without need forfurther action to the local treasurer on aquarterly basis within five days after the

end of every quarter.LGUs shall receive 1% of the gross

sale or receipts of the preceding calendaryear and 40% of taxes, fees or charges thatGOCCs would have paid if not tax exempt,whichever is higher.

How National Wealth is DistributedIf the national wealth is located in

one province, the province shall receive

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20%, the component city/municipality shallreceive 45% and the barangays 35%.

If the national wealth is located in twoor more LGUs, distribution shall be based onthe following: population- 70% and landarea- 30%.

If the national wealth is located in

highly urbanized city or independentcomponent city, the HUC or ICC shallreceive 65% and the barangays shallreceive 35%.

D. Fundamental Principles ofLocal Fiscal Administration

1. No money shall be paid out of thelocal treasury except in pursuance of anappropriation ordinance or law;

2. Local government funds andmonies shall be spent solely for publicpurposes;

3. Local revenue is generated onlyfrom the sources expressly authorized bylaw or ordinance, and collection thereofshall at all times be acknowledged properly;

4. All monies officially received bya local government officer in any capacity oron any occasion shall be accounted for aslocal funds, unless otherwise provided bylaw;

5. Trust funds in the local treasuryshall not be paid out except in fulfillment ofthe purpose for which the trust is created orthe funds received.

6. Every officer of the localgovernment unit whose duties permit orrequire the possession or custody of localfunds shall be properly bonded, and suchofficer shall be accountable and responsiblefor said funds and for the safekeepingthereof in conformity with the provisions oflaw.

7. Local governments shallformulate sound financial plans, and thelocal budgets shall be based on functions,activities and projects, in terms of expectedresults.

8. Local budget plans and goalsshall, as far as practicable, be harmonizedwith national development plans, goals andstrategies in order to optimize the utilizationof resources and to avoid duplication in theuse of fiscal and physical resources.

9. Local budgets shall operationalizeapproved development plans.

10. Local government units shallensure that their respective budgetsincorporate the requirements of theircomponent units and provide for equitableallocation of resources among these

component units.11. National planning shall be basedon local planning to ensure that the needsand aspirations of the people as articulatedby the local government units in theirrespective local development plans areconsidered in the formulation of budgets ofnational line agencies or offices.

12. Fiscal responsibility shall beshared by all those exercising authority over

the financial affairs, transactions, andoperations of the local government units.

13. The local government unit shallendeavor to have a balanced budget in eachfiscal year of operation.

4. Eminent Domain (19, LGC)

The power to expropriate privateproperty has been delegated by Congress toLGUs under 19, LGC. The exercise by LGUsof the power of eminent domain are subjectto the usual constitutional limitations suchas necessity, private property, taking, publicuse, just compensation and due process oflaw.

The determination of whether there isgenuine necessity for the exercise of thepower of eminent domain is a justiciable

question when exercised by the LGUs andgenerally a political question whenexercised by Congress.

NOTE:Private property already devoted to publicuse can still be a subject of expropriation byCongress but not by LGUs.

The additional limitations on theexercise of the power of eminent domain byLGUs are, as follows:1. Exercised only by the local chief

executive, acting pursuant to a validordinance;2. For public use or purpose or welfare, forthe benefit of the poor and the landless;3. Only after a valid and definite offer hadbeen made to, and not accepted by, theowner;4. An LGU shall file a complaint forexpropriation on the strength of anordinance and not a mere resolution passedby the Sanggunian. (Municipality ofParanaque vs. VM Realty Corp., 292 SCRA676)

The promulgation of the ordinanceauthorizing the local chief executive toexercise the power must be promulgatedprior to the filing of the complaint foreminent domain with the proper court, andnot after the court shall have determinedthe amount of just compensation to whichthe defendant is entitled. (Heirs ofSuguitan vs. City of Mandaluyong, 328SCRA 137)

NOTE:

An LGU may immediately take possessionof the property upon filing of expropriationproceedings and deposit in court of 15% ofthe FMV of the property.5. Other powers

a. Reclassification of lands (20,RA 7160)

A city or municipality may,through an ordinance passed after

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name of a local government unit or a publicplace, street or structure with historical,cultural, or ethnic significance shall not bechanged, unless by a unanimous vote of thesanggunian concerned and in consultationwith the Philippine Historical Commission.

A change of name of a public school shallbe made only upon the recommendation ofthe local school board concerned.

A change of name of public hospitals,health centers, and other health facilitiesshall be made only upon therecommendation of the local health boardconcerned.

The change of name of any localgovernment unit shall be effective onlyupon ratification in a plebiscite conducted

for the purpose in the political unit directlyaffected.In any change of name, the Office of thePresident, the representative of thelegislative district concerned, and theBureau of Posts shall be notified. (13, LGC)

d. Settlement of boundarydisputes (118 a-d, RA 7160):

Boundary disputes betweenand among local government unitsshall, as much as possible, be settledamicably. To this end:

a. Boundary disputesinvolving two or morebarangays in the samecity or municipalityshall be referred forsettlement to thesangguniangpanlungsod orsangguniang bayanconcerned.

b. Boundary disputesinvolving two or moremunicipalities within

the same province shallbe referred forsettlement to thesangguniangpanlalawiganconcerned.

c. Boundary disputesinvolving municipalitiesor component cities ofdifferent provincesshall be jointly referredfor settlement to thesanggunians of the

provinces concerned.d. Boundary disputesinvolving a componentcity or municipality onthe one hand and ahighly urbanized cityon the other, or two ormore highly urbanizedcities, shall be jointlyreferred for settlement

to the respectivesanggunians of theparties.

Procedure:In the event the sanggunian fails to

effect an amicable settlement within 60days from the date the dispute was referred

thereto, it shall issue a certification to thateffect. Thereafter, the dispute shall beformally tried by the sanggunian concernedwhich shall decide the issue within 60 daysfrom the date of the certification referred toabove.

Within the time and mannerprescribed by the Rules of Court, any partymay elevate the decision of the sanggunianconcerned, any party may elevate thedecision of the sanggunian concerned to theproper Regional Trial Court having

jurisdiction over the area in dispute. The

Regional Trial Court shall decide the appealwithin one (1) year from the filing thereof.Pending final resolution of the case, thedisputed area prior to the dispute shall bemaintained and continued for all legalpurposes. (119, LGC)

e. Authority over police units(6, Art. XVI, Philippine Constitution)

The State shall establish andmaintain one police force, which shall benational in scope and civilian in character,to be administered and controlled by a

National Police Commission. The authorityof local executives over the police units intheir jurisdiction shall be provided by law.

6. LOCAL LEGISLATIVE POWERA. Products of legislative action

1. Ordinance- prescribes arule of conduct.

2. Resolution- of temporarycharacter, or expresses sentiment.

B. Requisites for validity:1. Must not contravene the

Constitution and any statute2. Must not be unfair or

oppressive3. Must not be partial or

discriminatory4. Must not prohibit, but may

regulate trade5. Must not be unreasonable6. Must be general in

application and consistent withpublic policy.

Approval of ordinances:

Ordinances passed by thesangguniang panlalawigan, sangguniangpanlungsod or sangguniang bayan shall beapproved:If the local chief executive approves thesame, affixing his signature on each andevery page thereof.If the local chief executive vetoes the same,and the veto is overridden by 2/3 vote of allthe members of the sanggunian.

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Where petitioner was charged withfalsification of a public document forapproving a resolution which purportedlyappropriated money to pay for the terminalleave of 2 employees when actually no suchresolution was passed, the petitioner argued

that his signature on the resolution wasmerely ministerial. The Supreme Courtdisagreed, saying that the grant of the vetopower accords the Mayor the discretionwhether or not to approve the resolution.(De Los Reyes vs. Sandiganbayan, G.R.121215, Nov. 13, 1997)

NOTES:

1. The vice governor, the vice mayor andthe punong barangay shall be the presiding

officer of the sanggunians but shall voteonly in case of tie.

2. In case of inability of the presidingofficer, the members shall elect a temporarypresiding officer from among themselves.(49)

3. For disorderly behavior and absencewithout justifiable cause for 4 consecutivesessions, a member may be censured,reprimanded, excluded from the session,suspended for not more than 60 days, or

expelled. Suspension or expulsion shallrequire concurrence of at least 2/3 of allsanggunian members. A membersentenced by final judgment toimprisonment for at least one year for acrime involving moral turpitude shall beautomatically expelled. (50)

4. Every sanggunian member, uponassumption of office shall make a fulldisclosure of his business and financialinterests. He shall also disclose anybusiness, financial or professional

relationship or any relationship within the 4th

degree which he may have with anyoneaffected by any ordinance or resolution ofthe sanggunian which involves a conflict ofinterests.

Such relationship includes:i. Investment in the entity to which

the ordinance may applyii. Contracts with any person towhich the ordinance may apply

Conflict of interests refers to asituation where a sanggunian member maynot act in the public interest due to personal

consideration that may affect his judgmentto the prejudice of the public. (51)

5. A special session may be called by thelocal chief executive or a majority of thesanggunian members. Unless concurred inby 2/3 vote of the members present, nomatter may be reconsidered at the specialsession except those stated in the notice.(52)

6. A majority of all the members of thesanggunian shall constitute a quorum. (53)

7. An ordinance shall be approved by thelocal chief executive by affixing hissignature in each and every page thereof.

8. The governor or mayor may veto anyitem in the following cases:

a. Particular item or items in anappropriations ordinance

b. Ordinance adopting a localdevelopment plan and publicinvestment program

c. Ordinance directing the payment ofmoney or creating liability. (55)

9. The grounds for veto are:a. The ordinance is ultra viresb. Or that it is prejudicial to public

welfare

10. The veto shall be communicated to thesanggunian within 15 days in the case of aprovince and 10 days in the case of a city ormunicipality; otherwise, the ordinance shallbe deemed approved, as if he signed it. Thesanggunian may override the veto by 2/3 ofall its members. (54)

11. Ordinances enacted by thesangguniang barangay shall, upon approvalby a majority of all its members, be signed

by the Punong Barangay. The latter has noveto power.

12. Reviewa. The sangguniang panlalawigan shall

review ordinances and resolution ofcities and municipalities todetermine if they are within theirpower. (56)Procedure:

Within 3 days after approval,the secretary of the sangguniangpanlungsod (in component cities) or

sangguniang bayan shall forward tothe sangguniang panlalawigan forreview copies of approvedordinances and resolutions approvingthe local development plans andpublic investment programsformulated by the local developmentcouncils. The sangguniangpanlalawigan shall review the samewithin 30 days; if it finds that theordinance or resolution is beyond thepower conferred upon thesangguniang panlungsod or

sangguniang bayan concerned, itshall declare such ordinance orresolution invalid in whole or in part.If no action is taken within 30 days,the ordinance or resolution ispresumed consistent with law, andtherefore, valid.

b. The sangguniang panlungsod orbayan shall review sangguniang

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barangay ordinances to determine ifthey are lawful. (57)

Procedure:Within 10 days from enactment, the

sangguniang barangay shall furnishcopies of all barangay ordinances to the

sangguniang panlungsod orsangguniang bayan for review. If thereviewing sanggunian finds thebarangay ordinances inconsistent withlaw or city or municipal ordinances, thesangguniang concerned shall, within 30days from receipt thereof, return thesame with its comments andrecommendations to the sangguniangbarangay for adjustment, amendment ormodification, in which case the effetivityof the ordinance is suspended until therevision called for is effected. If no

action is taken by the sangguniangpanlungsod or sangguniang bayanwithin 30 days, the ordinance is deemedapproved.

13. Enforcement of disapprovedordinances/resolutions:

Any attempt to enforce an ordinanceor resolution approving the localdevelopment plan and public investmentprogram, after the disapproval thereof, shallbe sufficient ground for the suspension ordismissal of the official or employee

concerned.

14. Effectivitya. Unless otherwise stated in the

ordinance, it shall take effect after10 days from posting at theprovincial capitol or city, municipal orbarangay hall and two otherconspicuous places.

b. The gist of all ordinances with penalsanction shall be published in anewspaper of general circulation inthe province. In the absence of such

newspaper, the ordinance shall beposted in all municipalities and citiesof the province where thesanggunian of origin is situated.

c. In highly urbanized and independentcomponent cities, in addition toposting, the main features of theordinance shall be published in alocal newspaper of generalcirculation. In the absence of suchnewspaper, it shall be published inany newspaper of generalcirculation. (59

C. Corporate Powers (22, RA 7160)1. To have continuous succession in itscorporate name2. To sue and be sued3. To have and use a corporate seal4. To acquire and convey real or personalproperty

a. The local government unit mayacquire real or personal, tangible

or intangible property, in anymanner allowed by law, e.g.,sale, donation, etc.

b. The local government unit mayalienate only patrimonialproperty, upon proper authority.

c. In the absence of proof that theproperty was acquired throughcorporate or private funds, thepresumption is that it came fromthe State upon the creation of themunicipality and, thus, isgovernmental or public property.(Salas vs. Jarencio, 48 SCRA734; Rebuco vs. Villegas, 55SCRA 656)

d. Town plazas are properties ofpublic dominion; they may beoccupied temporarily, but only forthe duration of an emergency(Espiritu vs. MunicipalCouncil of Pozorrubio,Pangasinan, 102 Phil. 866).

e. A public plaza is beyond thecommerce of man, and cannot bethe subject of lease or othercontractual undertaking. And,even assuming the existence of avalid lease of the public plaza orpart thereof, the municipalresolution effectively terminatedthe agreement, for it is settled

that the police power cannot besurrendered or bargained awaythrough the medium of a contract(Villanueva vs. Castaneda,154 SCRA 142).

5. Power to enter into contractsa. Requisites of a valid municipal

contractsi. The local government unit

has the express, implied orinherent power to enterinto the particular contract.

ii. The contract is enteredinto by the properdepartment, board,committee, officer oragent. Unless otherwiseprovided by the Code, nocontract may be enteredinto by the local chiefexecutive on behalf of thelocal government unitwithout prior authorizationby the sangguniangconcerned.

iii. The contract must complywith certain substantiverequirements, i.e., whenexpenditure of public fundis to be made, there mustbe an actual appropriationand a certificate of availability of funds.

iv. The contract must complywith the formal

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requirements of writtencontracts, e.g., the Statuteof Frauds.

b. Ultra vires contractsWhen a contract is entered into

without compliance with the first andthe third requisites (above), the same

is ultra vires and is null and void.Such contract cannot be ratified orvalidated. Ratification of defectivemunicipal contracts is possible onlywhen there is non-compliance withthe second and/or fourthrequirements above. Ratificationmay be express or implied.

c. Authority to negotiate and securecontracts (23, RA 7160)

The local chief executive may,upon authority of the sanggunian,

negotiate and secure financial grantsor donations in kind, in support of thebasic services and facilitiesenumerated under 17, from localand foreign assistance agencieswithout necessity of securingclearance or approval from anydepartment, agency, or office of thenational government or from anyhigher local government unit;Provided, that projects financed bysuch grants or assistance withnational security implications shall

be approved by the national agencyconcerned.

6. To exercise such other powers asare granted to corporations, subject tolimitations provided in the Code andother laws.

V. MUNICIPAL LIABILITY

A. Specific provisions making LGUsliable:

a. 24, RA 7160- Liability for damages-Local government units and theirofficials are not exempt from liabilityfor death or injury to persons ordamage to property.

b. Art. 2189, NCC- The localgovernment unit is liable in damagesfor death or injuries suffered byreason of the defective condition ofroads, streets, bridges, publicbuildings and other public works.

c. Art. 2180, (par.6), NCC- The State isresponsible when it acts through a

special agent.d. Art. 34, NCC- The local government

unit is subsidiarily liable for damagessuffered by a person by reason of thefailure or refusal of a member of thepolice force to render aid andprosecution in case of danger to lifeand property.

2. Liability for Tort

a. If the local government unit isengaged in governmental functions, itis NOT liable.

b. If engaged in proprietary functions,local government unit is liable.Holding of town fiesta is aproprietary function. The Municipalityof Malasique, Pangasinan, was heldliable for the death of a member ofthe zarzuela group when the stagecollapsed, under the principle ofrespondeat superior.

NOTE:The municipal council managed the

town fiesta. While the municipality was heldliable, the councilors themselves are notliable for the negligence of their employeesor agents. (Torio vs. Fontanilla, 85 SCRA599)

c. Personal Liability of local officials

3. Liability for violation of law

Case:The Municipality of Bunawan, Agusan

del Sur, through the Mayor, was held incontempt and fined P1,000.00 with awarning, because of the refusal of the Mayorto abide by a Temporary Restraining Orderissued by the Court (Moday vs. CA, 243SCRA 152).

4. Liability for contracts

a. General Rule- A municipalcorporation, like an ordinary person,is liable on a contract it enters into,provided that the contract is intravires. If the contract is ultra vires,the munipal corporation is not liable.

NOTES:A private individual who deals with amunicipal corporation is imputedconstructive knowledge of the extent of

the power or authority of the municipalcorporation to enter into contracts.Ordinarily, therefore, the doctrine ofestoppel does not lie against municipalcorporation.

b. Doctrine of Implied MunicipalLiability- A municipality maybecome obligated upon an impliedcontract to pay the reasonable valueof the benefits accepted orappropriated by it as to which it hasthe general power to contract(Province of Cebu vs. IAC, 147SCRA 447).

The doctrine applies to all caseswhere money or property of a party isreceived under such circumstancesthat the general law, independent ofan express contract, implies anobligation to do justice with respectto the same.

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Thus, in this case, the Province ofCebu cannot set up the plea that thecontract was ultra vires and stillretain benefits thereunder. Havingregarded the contract as valid forpurposes of reaping benefits, theProvince of Cebu is estopped to

question its validity for the purpose ofdenying answerability.

VI. LOCAL OFFICIALS

A. Provisions applicable to electiveand appointive officials 1. 89, RA 7160: Prohibitedbusiness and pecuniary interest- It shallbe unlawful for any local government officialor employee, directly or indirectly, to:

a. Engage in any business transaction

with the local government unit inwhich he is an official or employeeor over which he has the power ofsupervision, or with any of itsauthorized boards, officials, agents,or attorneys, whereby money is tobe paid, or property or any otherthing of value is to be transferred,directly or indirectly, out of theresources of the local governmentunit to such person or firm;

b. Hold such interests in any cockpit orother games licensed by a local

government unit;c. Purchase any real estate or other

property forfeited in favor of suchlocal government unit for unpaidtaxes or assessment, or by virtue ofa legal process at the instance ofthe said local government unit;

d. Be a surety for any personcontracting or doing business withthe local government unit for whicha surety is required; and

e. Possess or use any public propertyof the local government unit for

private purposes.f. The prohibitions and inhibitions

prescribed in RA 6713 also apply.

2. Practice of Profession (90, RA7160)

a. Governors or mayors are prohibitedfrom practicinstrative proceedingsinvolving the local government unitof which he is an official.iv. Use property and personnel ofthe government except when thesanggunian member is defending

the interest of the government.

Case:It was held that by appearing as

counsel for dismissed employees, CityCouncilor Javellana violated the prohibitionagainst engaging in private practice if suchpractice represents interests adverse to thegovernment. (Javellana vs. DILG, 212SCRA 475)

b. Physicians may practice theirprofession even during office hoursonly on emergencies and withoutmonetary compensation.

3. Prohibition against appointment(94, RA 7160)

a. No elective or appointive localofficial shall be eligible forappointment or designation to anypublic office during his tenure.

b. Unless otherwise allowed by law orby the primary function of his office,no elective or appointive localofficial shall hold any other office.

c. Except for losing candidates inbarangay elections, no candidatewho lost in any election should beappointed to any office within oneyear after election.

B. ELECTIVE LOCAL OFFICIALS

1. Qualifications:a. Common qualifications:

i. Filipino Citizenii. Registered voter of the localgovernment unit, or of the districtwhere he intends to be elected in thecase of the members of thesanggunian.iii. Resident therein for at least oneyear immediately before the election

iv. Ability to read and write Filipino orany other local dialect.

b. Agei. Candidates in provinces and highlyurbanized cities- at least 23 years oldii. Candidates for mayor and vicemayor of component cities andmunicipalities- at least 21 years oldiii. Candidates for sanggunianmembers in component cities andmunicipalities- at least 18 years oldiv. Barangay officials- at least 18years old

v. Sangguniang Kabataan- at least15-21 years

NOTES:Age- must be possessed on the day of theelection.The LGC does not specify any particulardate when the candidate must possessFilipino citizenzship. Philippine citizenship isrequired to ensure that no alien shall governour people. An official begins to govern onlyupon his proclamation and on the day thathis term begins. Since Frivaldo took his

oath of allegiance on June 30, 1995, whenhis application for repatriation was grantedby the Special committee on Naturalizationcreated under PD 825, he was thereforequalified to be proclaimed. Besides, 39 ofthe LGC speaks of qualifications of electiveofficials, not of candidates (Frivaldo vs.COMELEC, 271 SCRA 767).

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Petitioner was over 21 years of age on theday of the election was ordered disqualifiedby the Supreme Court when the latterrejected the contention of the petitionerthat she was qualified because she was lessthan 22 years old. The phrase not morethan 21 years old is not equivalent to less

than 22 years old (Garvida vs. Sales).

2. Disqualifications (40, RA 7160)- Thefollowing are disqualified from running forany elective local position:

a. Those sentenced by finaljudgment for an offense involvingmoral turpitude or for an offensepunishable by one year or moreof imprisonment, within twoyears after serving sentence;

b. Those removed from office as aresult of an administrative case;

c. Those convicted by finaljudgment for violating the oath ofallegiance to the Republic;

d. Those with dual citizenship;e. Fugitives from justice in criminal

or non-political cases here orabroad;

f. Permanent residents in a foreigncountry or those who haveacquired the right to resideabroad and continue to avail ofthe same right after theeffectivity of the Code; and

g. The insane or feeble-minded.

3. Manner of Electiona. The governor, vice-governor,

city or municipal mayor, city ormunicipal vice-mayor andpunong barangay shall beelected at large in theirrespective units. Thesangguniang kabataan chairmanshall be elected by theregistered voters of thekatipunan ng kabataan.

b. The regular members of thesangguniang panlalawigan,panlungsod and bayan shall beelected by district, as may beprovided by law. The presidentsof the leagues of sanggunianmembers of component citiesand municipalities shall serve asex officio members of thesangguniang panlalawiganconcerned. The presidents ofthe liga ng mga barangay andthe pederasyon ng mga

sangguniang kabataan electedby their respective chapters,shall serve as ex officiomembers of the sangguniangpanlalawigan, panlungsod orbayan.

c. In addition, there shall be onesectoral representative from thewomen, one from the workers,and one from any of the

following sectors: urban poor,indigenous culturalcommunities, disabled persons,or any other sector as may bedetermined by the sanggunianconcerned within 90 days priorto the holding of the next local

elections as may be provided bylaw. The Comelec shallpromulgate the rules andregulations to effectivelyprovide for the election of suchsectoral representatives.

4. Date of ElectionEvery three years on the second

Monday of May, unless otherwise providedby law.

5. Term of Office

Three years, starting from noon of June 30, 1992, or such date as may beprovided by law, except that of electivebarangay officials. No local elective officialshall serve for more than three consecutiveterms in the same position. The term ofoffice of barangay officials and members ofthe sangguniang kabataan shall be for fiveyears, which shall begin after the regularelection of barangay officials on the secondMonday of May, 1997. (R.A. 8524)

The three-term limit on a local official is to

be understood to refer to terms for whichthe official concerned was elected. Thus, aperson who was elected Vice Mayor in 1988and who, because of the death of the Mayor,became Mayor in 1989, may still be eligibleto run for the position of Mayor in 1998,even if elected as such in 1992 and 1995(Borja v. Comelec, G.R. No. 133495,Sept. 3, 1998).

6. Rules on Succession (44-46, RA7160)

A. Permanent vacancies: A

permanent vacancy arises when anelective local official fills a higher vacantoffice, refuses to assume office, fails toqualify, dies, is removed from office,voluntarily resigns, or is permanentlyincapacitated to discharge the functionsof his office.a. Governor and Mayor

i. Vice Governor and Vice Mayorii. Sanggunian members according toranking

b. Punong barangayi. Highest ranking sanggunian

memberii. Second highest rankingsangguniang barangay member

c. Ranking in the sanggunian shall bedetermined on the basis of theproportion of the votes obtained tothe number of registered votes ineach district.

d. Ties will be resolved by drawing oflots. (44)

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e. Sanggunian:i. Provinces, highly urbanized citiesand independent component cities-appointment by the Presidentii. Component city and municipality-appointment by governoriii. Sangguniang barangay-

appointment by mayoriv. Except for the sangguniangbarangay, the appointee shall comefrom the political party of themember who caused the vacancy.

NOTE: A nomination and a certificate ofmembership of the appointee from thehighest official of the political partyconcerned are conditions sine qua non, andany appointment without such nominationand certificate shall be null and void and

shall be a ground for administrative actionagainst the official concerned.

v. If the member does not belong toany party, the appointee shall berecommended by the sanggunian.vi. The appointee for thesangguniang barangay shall berecommended by the sangguniangbarangay.vii. Vacancy in the representation ofthe youth and the barangay in thesanggunian shall be filled by the

official next in rank of theorganization. (45)

B. Temporary vacancya. When the governor, mayor or

punong barangay is temporarilyincapacitated to perform his duties,the vice governor, vice mayor, orranking sangguniang barangaymember shall exercise his powersexcept the power to appoint,suspend or dismiss employees,which can only be exercised after 30

working days.b. When the local chief executive is

traveling within the Philippines fornot more than 3 consecutive days,he may designate an officer-in-charge. The authorization shallspecify the powers of the officer-in-charge except the power to appoint,suspend or dismiss employees.

c. If the local chief executive does notissue the authorization, the vicegovernor, vice mayor, or highestranking sangguniang barangay

member shall assume his powers onthe fourth day of his absence. (46)

7. Compensation (81, R.A. 7160)The compensation of local officials and

personnel shall be determined by thesanggunian concerned, subject to theprovisions of R.A. 6758 (Compensation andPosition Classification Act of 1989). Theelective barangay officials shall be entitled

to receive honoraria, allowances and otheremoluments as may be provided by law orbarangay, municipal or city ordinance, butin no case less than P1,000 per month forthe punong barangay and P600 for thesangguniang barangay members.

Elective local officials shall be entitled tothe same leave privileges as those enjoyedby appointive local officials, including thecumulation and commutation thereof.

7. Recall- termination of official relationshipof an elective official for loss of confidenceprior to the expiration of his term throughthe will of the electorate.

a. By whom exercised- by theregistered voters of a local governmentunit to which the local elective official

subject to such recall belongs. (69, R.A.7160)b. Two modes of initiating recall:

i. By a preparatory recall assemblyii. By the registered voters of the

local government unitc. Preparatory recall assembly-

composed of the following:i. Provincial level: All mayors, vicemayors and sanggunian members ofthe municipalities and componentcities.ii. City level: All punong barangay

and sangguniang barangaymembers in the city.iii. Legislative district level: Wheresangguniang panlalalwiganmembers are elected by district, allelective municipal officials in thedistrict; and in cases wheresangguniang panglungsod membersare elected by district, all electivebarangay officials in the district.iv. Municipal level: All punongbarangay and sangguniangbarangay members in the

municipality.

d. Procedure for initiating recall bypreparatory recall assembly

A majority of all the preparatoryrecall assembly members may convene insession in a public place and initiate a recallproceeding against any elective official inthe local government unit concerned.Recall of provincial, city or municipalofficials shall be validly initiated through aresolution adopted by a majority of all themembers of the preparatory recall assembly

concerned during its session called for thatpurpose.

Case:It was held that notice to all the

members of the Preparatory RecallAssembly is imperative; thus, where theresolution was adopted without givingnotice to all the members of the PRA, thesame is fatally flawed (Garcia vs.

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Comelec, G.R. No. 111511, October 5,1993). However, in Malonzo vs.Comelec, G.R. No. 127066, March 11,1997, it was held that where the Comelechas already conducted an investigation andfound the initiatory recall proceedings to bein accord with law, there is no necessity for

the Supreme Court to refer the matter ofthe veracity of the questioned notices backto the Comelec.

e. Initiation of recall by registeredvoters: Recall of a provincial, city,municipal or barangay official may also bevalidly initiated upon petition by at least25% of the total number of registered votersin the local government unit concernedduring the election in which the local officialsought to be recalled was elected.

f. Procedure:i. A written petition for recall dulysigned before the election registrar orhis representative, and in thepresence of a representative of thepetitioner and representative of theofficial sought to be recalled, and in apublic place in the province, city,municipality or barangay, as the casemay be, shall be filed with theComelec through its office in the localgovernment unit concerned.ii. The Comelec or its duly

authorized representative shall causethe publication of the petition in apublic and conspicuous place for aperiod of not less than 10 days normore than 20 days, for the purpose ofverifying the authenticity andgenuineness of the petition and therequired percentage of voters.iii. Upon the lapse of the aforesaidperiod, the Comelec or its dulyauthorized representative shallannounce the acceptance ofcandidates to the position and

thereafter prepare the list ofcandidates which shall include thename of the official sought to berecalled.

The elective local official sought to berecalled shall not be allowed to resign whilethe recall process is in progress.Limitations on Recall:

1. Any elective local official may be thesubject of a recall election only once duringhis term of office for loss of confidence.

2. No recall shall take place within one

year from the date of the officialsassumption to office or one yearimmediately preceding a regular localelection.The official sought to be recalled isautomatically a candidate.Recall shall be effective upon the electionand proclamation of successor receiving thehighest number of votes.

9. Resignation of elective localofficials shall be deemed effective onlyupon acceptance by the followingauthorities:

a. The President, in case of governors,vice governors, and mayors and vicemayors of highly urbanized cities

and independent component cities;b. The governor, in case of municipal

mayors and vice mayors, citymayors and vice mayors of component cities;

c. Sanggunian concerned, in case ofsangguniang members; and

d. The city or municipal mayor, in caseof barangay officials.

Effectivity:c. Resignation takes effect upon

acceptance.

d. It is deemed accepted if not actedupon within 15 working days.

e. Irrevocable resignation bysanggunian members takes effectupon presentation before an opensession. (82, R.A. 7160)

10. Grievance Procedure (83, R.A.7160)- The local chief executive shallestablish a procedure to inquire into, actupon, resolve or settle complaints andgrievances presented by local governmentemployees.

11. Discipline (60-68, R.A. 7160)a. Grounds for disciplinary action:

An elective local official may be disciplined,suspended, or removed from office on anyof the following grounds:

i. Disloyalty to the Republic of thePhilippines.

ii. Culpable violation of theConstitution

iii. Dishonesty, oppression,misconduct in office, gross negligence, ordereliction of duty.

iv. Commission of any offenseinvolving moral turpitude or an offensepunishable by at least prision mayor.

v. Abuse of authority.vi. Unauthorized absence for 15

consecutive working days, except in thecase of members of the sangguniangpanlalawigan, panlungsod, bayan andbarangay.

vii. Application for, or acquisitionof, foreign citizenship or residence or thestatus Elective barangay officials, shall befiled before the sangguiniang panlungsod or

sangguniang bayan concerned, whosedecision shall be final and executory.

c. Notice of Hearing (62, R.A.7160)- (a) Within 7 days after theadministrative complaint is filed, theOffice of the President or the sanggunianconcerned as the case may be, shallrequire the respondent to submit hisverified answer within 15 days from

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receipt thereof, and commence theinvestigation of the case within 10 daysafter the receipt of such answer of therespondent.

(b) When the respondent is anelective official of a province or highlyurbanized city, such hearing and

investigation shall be conducted in theplace where he renders or holds office.For all other local elective officials, thevenue shall be the place where thesanggunian concerned is located.

(c) However, no investigation shallbe held within 90 days immediately priorto any local election, and no preventivesuspension shall be imposed prior to the90-day period immediately precedinglocal election, it shall be deemedautomatically lifted upon the start ofaforesaid period.

d. Preventive Suspension1. Who may impose:

a. By the President, if therespondent is an electiveofficial of a province, a highlyurbanized or an independentcomponent city;

b. By the governor, if therespondent is an elective localofficial of a component city ormunicipality;

c. By the mayor, if the

respondent is an electiveofficial of the barangay.

2. When may be imposed:Preventive suspension may be imposed atany time:

a. After the issues are joined;b. When the evidence of guilt is

strong; andc. Given the gravity of the

offense, there is greatprobability that thecontinuance in office of therespondent could influence

the witnesses or pose a threatto the safety and integrity ofthe records and otherevidence.

Provided that any single preventivesuspension shall not extend beyond60 days, and in the event severaladministrative cases are filed againstthe respondent, he cannot besuspended for more than 90 dayswithin a single year on the sameground or grounds existing and

known at the time of the firstsuspension.

Case:When the petitioner failed to file his

answer despite the many opportunitiesgiven to him, he was deemed to havewaived his right to answer and to presentevidence. At that point, the issues weredeemed joined, and it was proper for the

Executive Secretary to suspend him,inasmuch as the Secretary found that theevidence of guilt was strong and thatcontinuance in office could influence thewitnesses and pose a threat to the safetyand integrity of the evidence against him(Joson vs. Torres, 290 SCRA 279).

The authority to preventivelysuspend is exercised concurrently by theOmbudsman, pursuant to R.A. 6770; thesame law authorizes a preventivesuspension of six months (Hagad vs.Gozo-Dadole, G.R. no. 108072, Dec. 12,1995).

e. Suspended elective official whendeemed reinstated

Upon expiration of the preventivesuspension, the respondent shall be

deemed reinstated in office withoutprejudice to the continuation of theproceedings against him, which shall beterminated within 120 days from the timehe was formally notified of the case againsthim.

Any abuse of the exercise of thepower of preventive suspension shall bepenalized as abuse of authority.

f. Salary of respondent pendingsuspension (64, R.A. 7160) The respondent official preventively

suspended from office shall receive nosalary or compensation during suchsuspension; but, upon subsequentexoneration and reinstatement, he shall bepaid full salary or compensation includingsuch emoluments accruing during suchsuspension.

g. Rights of respondent (65, R.A.7160) The respondent shall be accordedfull opportunity to appear and defendhimself in person or by counsel, to confront

and cross-examine the witnesses againsthim, and to require the attendance ofwitnesses and the production of documentary evidence in his favor throughcompulsory process of subpoena orsubpoena duces tecum.

h. Form and notice of decision(66a, R.A. 7160)

The investigation of the case shallbe terminated within 90 days from the startthereof. Within 30 days after the end of theinvestigation, the Office of the President or

the sanggunian concerned shall render adecision in writing stating clearly andistinctly the facts and the reasons for suchdecision. Copy of said decision shallimmediately be furnished the respondentand all interested parties.

i. PenaltyThe penalty of suspension imposed

upon the respondent shall not exceed his

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unexpired term, or a period of 6 months forevery administrative offense, nor shall saidpenalty be a bar to the candidacy of therespondent as long as he meets thequalifications required for the office. Butthe penalty of removal from office as aresult of an administrative investigation

shall be a bar to the candidacy of therespondent for any elective position.

Case: The Supreme Court upheld the

imposition of the administrative penalty ofsuspension of not more than 6 months foreach offense, provided that the successiveservice of the sentence should not exceedthe unexpired portion of the term of thepetitioners. The suspension did not amountto removal from office (Salalima vs.Guingona, 257 SCRA 55).

j. Administrative appeal- Decisionsmay, within 30 days from receiptthereof, be appealed to:

i. The sangguniang panlalawigan,in the case of decisions of component citiessangguniang panlungsod and thesangguiniang bayan;

ii. The Office of the President, inthe case of decisions of the sangguniangpanlalawigan and the sangguniangpanlungsod of highly urbanized cities andindependent component cities. Decisions of

the Office of the President shall be final andexecutory.

Case: The Supreme Court ruled that

certiorari will not lie because there is still anadequate remedy available in the ordinarycourse of law, i.e., appeal of the decision ofthe Sangguniang Panlalawigan to the Officeof the President(Malinao vs. Reyes, 255SCRA 616).

k. Execution pending appeal

An appeal shall not prevent adecision from being executed; therespondent shall be considered as havingbeen placed under preventive suspensionduring the pendency of the appeal. But inBerces vs. Executive Secretary, 241 SCRA539, the Supreme Court pointed out thatAdministrative Order No. 18 authorizes theOffice of the President to stay the executionof a decision pending appeal. A.O. No. 18was not repealed by the Local GovernmentCode.

l. Presidential power to grant executiveclemencym. Effect of re-election

The re-election of a local officialbars the continuation of the administrativecase against him.

C. Appointive Local Officials1. Responsibility for human resources

and development- The local chief executive

shall be responsible for human resourcesand development in his unit and shall takeall personnel actions in accordance with theConstitution, pertinent laws, including suchpolicies, guidelines and standards as theCivil Service Commission may establish;Provided that the local chief executive may

employ emergency or casual employees orlaborers paid on a daily wage or pieceworkbasis and hired through job orders for localprojects authorized by the sanggunianconcerned, without need of approval orattestation by the CSC as long as the saidemployment shall not exceed 6 months.

Case:But the Provincial Governor is

without authority to designate the petitioneras Assistant Provincial Treasurer forAdministration, because under 471 of the

Local Government Code, it is the Secretaryof Finance who has the power to appointAssistant Provincial Treasurers from a list ofrecommendees of the Provincial Governor(Dimaandal vs. Commission on Audit,291 SCRA 322).

2. Officials common to allMunicipalities, Cities and Provinces(469-490, R.A. 7160)

a. Secretary to the Sanggunianb. Treasurerc. Assessor

d. Accountante. Budget Officerf. Planning and Development

Coordinatorg. Engineerh. Health Officeri. Civil Registrar

j. Administratork. Legal Officerl. Agriculturistm. Social Welfare and

Development Officern. Environment and Natural

Resources Officero. Architectp. Information Officerq. Cooperatives Officerr. Population Officers. Veterinariant. General Services Officer

NOTE:In the barangay, the mandated

appointive officials are the BarangaySecretary and the Barangay Treasurer,although other officials of the barangay may

be appointed by the punong barangay.

3. Administrative disciplineInvestigation and adjudication

of administrative complaints againstappointive local officials and employees aswell as their suspension and removal shallbe in accordance with the civil service lawand rules and other pertinent laws.

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a. Preventive suspension- Thelocal chief executive maypreventively suspend for aperiod not exceeding 60 daysany subordinate official oremployee under his authoritypending investigation if the

charge against such official oremployee involvesdishonesty, oppression orgrave misconduct or neglectin the performance of duty, orif there is reason to believethat the respondent is guiltyof the charges which wouldwarrant his removal from theservice.

b. Disciplinary Action- Except asotherwise provided by law,

the local chief executive mayimpose the penalty of removal from service,demotion in rank, suspensionfor not more than 1 yearwithout pay, fine in anamount not exceeding 6months salary or reprimand.If the penalty imposed issuspension without pay fornot more than 30 days, hisdecision shall be final; if thepenalty imposed is heavier,

the decision shall beappealable to the CivilService Commission whichshall decide the appeal within30 days from receipt thereof.

VII. LOCAL INITIATIVE ANDREFERENDUM

A. Local Initiative1. Defined- It is the legal

process whereby theregistered voters of a

local government unitmay directly propose,enact or amend anyordinance. It may beexercised by allregistered voters of theprovinces, cities,municipalities andbarangays

2. Procedure:

a. Not less than 2,000

registered voters inthe region; 1,000registered voters incase of provinces andcities; 100 voters incase of municipalities,and 50 in case of barangays, may file apetition with thesanggunian concerned

proposing theadoption, enactment,repeal or amendmentof an ordinance.

b. If no favorable actionis taken by thesanggunian concerned

within 30 days frompresentation, theproponents, throughtheir duly authorizedand registeredrepresentatives, mayinvoke their power ofinitiative, giving noticethereof to thesanggunianconcerned.

c. The p

37600946 public corporations law 2 memory aid

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