Republic of the Philippines SUPREME COURT Manila

EN BANC G.R. No. L-1891 March 31, 1949

CO CHIONG, ET AL., petitioners, vs. THE MAYOR OF MANILA, THE CITY TREASURER OF MANILA, THE MEMBER OF THE MARKET COMMITTEE OF THE CITY OF MANILA, THE MARKET MASTERS OF DIVISORIA, ARANQUE, QUINTA, OBRERO, BAMBANG, SAMPALOC, PACO & other MARKETS OF MANILA, respondents. Quisumbing, Sycip, Quisumbing & Salazar for petitioners. City Fiscal Jose P. Bengzon & Assistant City Fiscal Julio Villamor for respondents. PERFECTO, J.: Petitioners allege that they are lessees of public market stall in the city of Manila by virtue of contracts of lease expressly understood to be of continuous duration until the city Mayor, for reasonable or just cause or any violation of the provision of the market code or any ordinance, or any rules relating to the administration of public markets, revokes the same; that on October 1, 1946, RA37 was promulgated & to carry into effect its purposes, the Secretary of Finance issued Department Order No. 32 on November 29, 1946; that petitioners filed with the Court of First Instances of Manila a petition challenging the constitutionality of RA37 & DO 32 & praying for injunction to restrain their ejection from the leased public market stall; that on April 19, 1947, the trial court rendered judgment annulling section 2 of DO 32 & commanding respondents to desist from enforcing the provisions thereof, from which decision respondents appealed to the Supreme Court; that on June 26, 1947, Ordinance No. 3051, amending Ordinance No. 2995, was promulgated providing for the termination of the occupancy of public market stalls by the Chinese petitioners; that petitioners are entitled to a writ of injunction to command respondents to desist from enforcing said Ordinance No. 3051 because it was returned by the mayor with a qualified approval which, therefore, operated as a veto & avoided the promulgation of a valid ordinance as the mayor has no right to qualify his approval & thereby amend the ordinances adopted by the municipality board; that while Ordinance No. 3051 provided for the termination on June 30, 1947 of any existing permission granted for the occupancy of public market stalls, the mayor approved the same subject to his interpretation that licenses paid up to December 331, 1947 would not terminate until the latter date; that Ordinance No. 3051 is null & void, 1. being inconsistent with the public policy of the state as declared in RA37; 2. that said ordinance is unconstitutional in that it impairs the obligation of contracts, 3. it nullifies the substantial protection of due process,

4. it denies petitioner & aliens the equal protection of the law, is unreasonable, unfair, oppressive, partial, & discriminatory, & is in conflict with common right, 5. it prohibits trade by Chinese stall holders, is violative of the generally accepted principles of international law & of the treaty obligation of the Philippines with respect to commercial activities by Chinese & other aliens & of the basic principles laid down in the United Nations Organization Charter; that said ordinance cannot be enforced while the question of the constitutional of RA37 is pending before the court; & that the ordnance is obviously an attempt by an inferior legislative body to evade the decision rendered by the trial court in civil case No. 1436. Petitioners pray for the issuance of writ of preliminary injunction which was denied on January 8, 1948. Petitioners filed an urgent petition for preliminary injunction & motion for reconsideration of said resolution of January 8, but they were also denied by resolution issued on January 21, 1948. Respondent deny petitioners' allegation with respect to the condition of the contracts of lease, conceding arguendo that petitioners were lessees for the occupancy of the public market stall in question, & allege that the fees of stall holders were collected either daily, weekly or monthly and, therefore, the contracts of lease which had no definite period had expired on December 31, 1947; That petitioners' claim, that said leases are of continuous & indefinite duration, is contrary to law & would the purpose of RA37, as well as ordinance No. 3051 independently intended to put into effect the provision of said acts; that Ordinance No. 3051 does not impair the obligation of contracts because the licenses granted to petitioners to occupy public market stall were not contracts but lease privileges which may be withdrawal at will; that the establishment, maintenance & operation of markets, admittedly governmental in nature, are nonseparable from the regulation as regards the leasing thereof, & the occupants have no such interest in the stall which a lessee of a store or dwelling has, & that the municipal corporation may provide for the revocation of the permit or licenses; that petitioners are mere licensees & their licenses are not contracts which would create in their favor vested rights protected against future & subsequent enactments; that Ordinance No. 3051 does not deprive petitioner of the equal protection of law, which does not limit the police power of the state to legislate for the promotion of the general welfare & prosperity, & the nationalization of retail trade; that the ordinance is not unreasonable, unfair, oppressive, partial & discriminatory & it is not made the subject of civil case No. 1436 of the Court of First Instance of Manila and, by its nature, may be forced independently of RA37; & that no generally accepted principle in international law is violated by its enactment, while, on the other hand, the right of a state to self-determination is respected by the Charter of the United Nations. There is no question that the establishment, maintenance & operation of public market are government in nature, being among the public functions of the state & therefore, the opportunity of occupying stall in public markets is a privilege that can be granted or withdrawn without impairing any one of the guarantees embodies in the Bill of Right of the Constitution. In the case of Co Chiong vs. Cuaderno, Sr., m 83 Phil., 242, we have already declared: Public market are public service or utilities as much as the public supply & sale of gas, gasoline, electricity, water & public transportation are. Under the Constitution, the operation of all public

services are reserved to Filipino citizen & to corporations or associations sixty per centum of the capital of which belongs to Filipino citizens. No franchise, certificate, or any other form of authorization for the operation of a public utility shall be granted except to citizens of the Philippines or to corporation or other entities organized under the law of the Philippines, sixty per centum of the capital of which is owned by citizens of Philippines, nor shall such franchise, certificate, or authorization be exclusive in character or for a longer period than fifty years. No franchise or right shall be granted to any individual, firm, or corporation, except under the condition that it shall be subject to amendment, alteration, or repeal by the Congress when the public interest so requires. Foodstuffs sold in public markets demand at least, as much official control & supervision as the commodities sold & distributed in other public utilities. They affect the life & health of the people, the safeguarding of which is one of the basic obligations of a constituted government. Official control & supervision can be exercised more effectively if public market stalls are occupied by citizens rather than by aliens. In impugning the validity of RA37, appellees invoke general guarantees in the Bill of Rights, such as the due process of law & the equal protection of the laws. Even if their position could be supported under said general guarantees, a hypothesis the validity of which we consider unnecessary to decide, said guarantees have to give way to the specific provision above quoted which reserves to Filipino citizens the operation of public services of utilities. Furthermore, the establishment, maintenance, & operation of public markets as much as public works are part of the functions of government. The privilege of participating in said functions, such as that of occupying market stalls, is not as that among the fundamental right or even among the general civil rights protested by the guarantees of the Bill of Right. The exercise or enjoyment of public functions are reserved to class of person possessing the specific qualifications required by law. Such is the case of the privilege to vote, to occupy a government position, or to participate in public works. They are reserved exclusively to citizens. Public function are power of national sovereignty & it is elementary that such sovereignty be exercised exclusively by nationals. Although foreigners are entitled to all the right & privileges of friendly guests, they can not claim the right to enjoy privileges which by their nature belong exclusively to the host. With the above pronouncements the whole controversy is disposed of against petitioners. Ordinance No. 3051 offends neither the constitutional clause guaranteeing the obligation of contracts nor the guarantees of due process of law & equal protection of the law. Neither does it violation any principle of international law nor any of the provisions of the Charter of the United Nation Organization. It does not impair any treaty commitment, as the treaties mentioned by petitioners have no binding effect upon the Republic of the Philippines is bound only by treaties concluded & ratified in accordance with our Constitution. Ordinance No. 3051 of the City of Manila is valid. Moran, C.J., Pablo, Briones & Tuason, JJ., concur. Paras & Feria, JJ., concur in the result.

Co Chiong vs Mayor of Manila Facts: Petitioners are lessees of public market by virtue of contract of lease until the city mayor for reasonable and just cause revokes the same. RA 37 which provides that all Filipino citizens have preference lease public market stalls was promulgated to execute its effects department order no. 32 has been issued by the secretary of finance. Aggrieved petitioners file and appeal questioning the constitutionally of the laws above mentioned & praying for injunction to restrain their ejection. Trial court annulled sec. 2 of DO 32 & commanding respondents to desist from enforcing the provisions thereof, from which decision respondents appealed to the Supreme Court. Pending question of constitutionality ordinance no. 3051 amending ordinance no. 2995, terminating all Chinese lessees has been promulgated which prompt petitioners to file a writ of injunction which the trial court denied. Petitioners filed an urgent petition for preliminary injunction & motion for reconsideration, but they were also denied. Petitioners argued that the ordinance no. 37 violates equal protection clause and the general accepted principle of the international law and the provision and lay down the United Nations. Issue: Whether or not Ordinance no. 37 violates international law. Held: In the case of Chiong vs Cuaderno, SC ruled that Public markets are public service or utilities as much as the public supply & sale of gas, gasoline, electricity, water & public transportation are. Under the Constitution, the operation of all public services is reserved to Filipino citizen & to corporations or associations 60 % of the capital of which belongs to Filipino citizens. Foodstuffs sold in public markets demand at least, as much official control & supervision. They affect the life & health of the people, the safeguarding of which is one of the basic obligations of a constituted government. Official control & supervision can be exercised more effectively if public market stalls are occupied by citizens rather than by aliens. With the above pronouncements, Ordinance No. 3051 offends neither the constitutional clause guaranteeing the obligation of contracts nor the guarantees of due process of law & equal protection of the law. Neither does it violation neither any principle of international law nor any of the provisions of the Charter of the United Nation Organization. It does not impair any treaty commitment, as the treaties mentioned by petitioners have no binding effect upon the Republic of the Philippines is bound only by treaties concluded & ratified in accordance with our Constitution. Ordinance No. 3051 of the City of Manila is valid.