De La Salle University

College of Law
Second Term School year 2014-15
The Law on Local Governments
By: Prof. Victoria V. Loanzon
Course Objectives:
1. To provide students with both the constitutional and statutory frameworks
covering municipal/public corporations.
2. To make students aware of the factors in the creation, merger and abolition of
local government units.
3. To make students differentiate the types of local government units and their
corresponding role in national and local governance including the functions of
special bodies under the Local Government Code (LGC).
4. To make students recognize the extent of the powers exercised by local
government units and their liabilities including those of officers and employees
under contracts and for tort.
5. To make students distinguish how local officials are elected and appointed and
how they are subjected to disciplinary action.
I. INTRODUCTION
A. Concept
1. Distinguished from Government Owned and Controlled Corporation
2. Classifications: quasi-corporations and municipal corporations
Section 6, Section 15 LGC, Book 1, Art.37, Civil Code
Cases:
Municipality of Catbalogan v. Director of Lands, 17 Phil 216
Villas v. City of Manila 41 Phil, 953 (1921)
3. Local Governments (also referred to as municipal or public corporations) as part
of the Executive Branch
Sections 2 and 4, Article X, Constitution and Section 25,LGC
Cases:
Province of Batangas v. Romulo, 429 SCRA 736 (2004)
National Liga ng mga Barangay v. Paredes, G.R. No. 152774, May 27, 2004
B. Nature and Status of Municipal Corporations
1. Municipal Corporations as Juridical Entities
Cases:
Lidasan v. COMELEC 12 SCRA 496 (1961)
Republic v. City of Davao, G.R. No. 148622, September 12, 2002
2. Local Government Units
Barangay (Sections 384-439, LGC)
Municipality (Sections 440-447, LGC)
City (Sections 448-458, LGC)
Province (Sections 459-490, LGC)
Autonomous Regions (Section 526, LGC; Sections 1, 15, 16, 17, 18, 20 and 21,
Art. X, Constitution)

II. CONSTITUTIONAL AND LEGAL FRAMEWORK
A. 1987 Constitution
1. Article VII, Sections 1 and 17 on The Presidents power over local
governments
Case:
The Province of Negros Occidental v. COA, et al., G.R. No. 182574, September
28, 2010
2. Article X, Sections 1-14
Case:
Buklod ng Magbubukid sa Lupaing Ramos, Inc. v. E.M. Ramos and Sons, Inc., G.R.
No. 131481, March 16, 2011
2. Article XVIII, Section 9
B. Republic Act 7160 - Local Government Code of 1991, as amended (effectivity date:
January 1, 1992)
1. Extent of application: provinces, cities, municipalities, barangays and other
political subdivisions (Sec. 4, LGC)
2. Rules of Interpretation (Sec. 5, LGC)
3. Declaration of Policy (Sec. 2, LGC)
Principle of Devolution (Sec. 17, [4] (e) and (i), LGC)
Case:
Pimentel, Jr. v. Executive Secretary Ochoa, et al., G.R. No. 195770, July 17, 2012
Local Autonomy and National Accountability
Cases:
Tan v. Perena, 452 SCRA 53(2005)
Batangas CATV, Inc. v. Court of Appeals, 439 SCRA 326 (2004)
Local Autonomy and Decision-Making
Cases:
Davao New Town Development Corp. v. Spouses Espino et. al., G.R. No.
174588, December 11, 2013
Province of Rizal v. Executive Secretary, 477 SCRA 436 (2005)

III. CREATION AND ABOLITION OF MUNICIPAL CORPORATIONS
A. Requisites for creation of local government units
B. Factors to consider (Sec. 7. LGC):, Population (NSO), Income (DOF) and Land
Area (DENR)
1. Population Requirement:
(1) All barangays
(2) Barangay in Metro Manila and other Highly Urbanized Areas
(3) Municipality
(4) City
(5) Province
Case:
Aldaba v. COMELEC, 611 SCRA 137 (2010)
2. Income: Average two years income requirement under Sec. 450 of the
LGC:
(1) Province
(2) Highly Urbanized City
(3) City
(4) Municipality
3. Land Area Requirements:
(1) Municipality: 50 sq. km.
(2) City: 100 sq. km.
(3) Province: 2,000 sq.km
Case:
Navarro v. Ermita 613 SCRA 131 (2010) and 648 SCRA 400 (2011)
C. Creation of municipal corporation is a legislative matter (Sec. 14, LGC)
Cases:
League of Cities of the Philippines (LCP) v.COMELEC, 571 SCRA 263(2008), 608
SCRA 636 (2009), 628 SCRA 819 (2010), 643 SCRA 149 (2011), 648 SCRA 798
(2011)
Aquino III and Robredo v. COMELEC, 611 SCRA 137 (2010)
D. Creation of autonomous regional bodies - Sec. 1, Sec. 4, Sec. 13 & Sec. 14
Article X
General Rule: An organic act creates autonomous regional bodies.
Examples:
R.A. No. 7924 (Metropolitan Manila Development Authority)
Powers of Metropolitan Political and Administrative Body
Cases:
MMDA v. Bel-Air Village Assn. Inc., 328 SCRA 836
MMDA v. Garin, 456 SCRA 176
MMDA v. Viron Transportation Co., Inc., 530 SCRA 341 (2007)
R. A. No. 6734 (Organic Act for ARMM)
Cases:
Disomangcop v. Datumanong, 444 SCRA 203 (2004)
Sema v. Commission on Elections, 558 SCRA 700 (2008)
Kida v. Senate, 659 SCRA 270 (2011) and S.C. Resolution dated February
28, 2012
R. A. No. 6766 (Organic Act for Cordillera Autonomous Region)
Cases:
Ordillo v. COMELEC, 192 SCRA 100 (1990)
Cordillera Broad Coalition v. COA, G. R. No. 79956, January 29, 1990
R. A. No. 7901 (Creating the CARAGA Administrative Region)
E. Division and Merger (Sec. 8, LGC)
Principle: To be valid, the division and merger shall comply with the requirements
of the creation of local government units. The income, population and
land area shall not be reduced to less than the minimum requirements
and the income classification of the original unit shall not fall below
its current income classification from such division.
F. Abolition (Sec. 9, LGC)
Principle: A local government unit may be abolished if its creation is judicially
declared invalid or due to infirmities relating to its creation.
G. Plebiscite Requirement (Sec. 10, LGC) in creation, division, merger, abolition

Cases:
Bagabuyo v. COMELEC, 573 SCRA 290 (2008)
Samson v. Aguirre, 315 SCRA 53
Tobias v. Abalos, 239 106
Classification of provinces, cities and municipalities (Read E.O. 349)
Status of de facto municipal corporations
Cases:
Municipality of San Narciso, Quezon et al v Hon. Mendez et al, 239 SCRA 11
Navarro v. Executive Secretary, supra.

IV. ESTABLISHING THE STATUS OF A LOCAL GOVERNMENT
A. Establishing the Seat of Government (Sec. 11, R.A. 7160)
1. How done: by law, if created by act of Congress /ordinance if created by LGU
2. What factors to consider
3. Procedural requirements
B. Naming of LGU's (Sec. 13, R.A. 7160)
C. Settlement of boundary disputes (Sec. 118, LGC, Sec. 15-19,IRR)
Rules in settlement of boundary disputes:
1. Regional trial courts exercise original jurisdiction over boundary disputes in
involving a MUNICIPALITY and an independent component city.
2. Sangguniang Panlalawigan exercises original jurisdiction over boundary
disputes involving two municipalities of the same province.
3. Joint Sangguniang Panlalawigan exercises original jurisdiction over boundary
disputes involving two municipalities of the different provinces.
4. Sangguniang Panlungsod exercises original jurisdiction over boundary disputes
involving two barangays of the same city.
5. Joint Sangguniang Panlungsod exercises original jurisdiction over boundary
disputes involving two barangays of two different cities.
6. The regional trial court exercises APPELLATE jurisdiction over boundary
disputes among local government units.

Cases:
Calanza v. PICOP, 586 SCRA 408 (2009)
City of Pasig v. COMELEC, 314 SCRA 179 (1999)
Municipality of Kananga v. Madrona, G.R. No. 141375, April 30, 2003


V. GENERAL POWERS AND ATTRIBUTES OF LOCAL GOVERNMENTS
A. Sources of Powers (Constitution, Charter, Local Government Code and other laws)
Note: Review the General Principles Governing the Powers of the State
B. Nature of Powers Exercised by Local Governments
1. Police Power
General Welfare Clause and limitations on the exercise thereof (See 16, LGC)
Cases:
Rimando v. Naguilan Emission Testing Center, Inc., et al., G.R. No. 198860, July 23,
2012
Social Justice Society v. Atienza, Jr. 517 SCRA 657 (2007) and 545 SCRA 92 (2008)
Lucena Grand Central Terminal, Inc. v. JAC, 452 SCRA 174 (2005)
City of Manila v. Laguio, Jr. 455 SCRA 308 (2005)
White Light Corp. v. City of Manila, 576 SCRA 416 (2009)
Albon v. Fernando, 494 SCRA 141 (2006)
Power to Open and Close Roads (Sec. 21, LGC, Art. 34-45, IRR) as part of police power
Factors to consider in vacating a street
Cases:
City of Manila v. Chinese Community, 40 Phil. 349 (1919)
Figuracion v. Libi, 539 SCRA 50 (2007)
2. Power of Eminent Domain
Requisites for the Exercise (Sec. 9, Art. III, 1987 Constitution; Sec. 19, LGC and
Art. 32 and 36, IRR; Rule 97, 1997 Rules of Civil Procedure; and DILG Opinion
No. 11-1996)
Cases:
Spouses Yusay v. C.A., City Mayor and City Council of Mandaluyong City,
G.R. No. 156684, April 6, 2011
Province of Camarines Sur v. C. A., 222 SCRA 173
Henry L. Sy v. Q.C.., G.R. No. 202690, June 5, 2013
Ortega v. City of Cebu, 602 SCRA 601 (2009)
3. Powers of Taxation and Fiscal Administration
Principle: The revenue raised thru local taxation shall be for public purpose.
(a) Local Taxation (Sections 5, 6 & 7, Art. X, 1987 Const., Sees. 128-196, LGC)
Requisites for the exercise; publication requirements and public hearing
Cases:
Smart Communications. Inc. v. Municipality of Malvar, Batangas, G.R. No.
204429, February18, 2014
GSIS v. City Treasurer of Manila, 609 SCRA (2009)
MIAA v. C.A., 495 SCRA 591 (2006)
(b) Limitations on municipal taxing power
Cases:
Quezon City v. ABS-CBN, G.R. No. 166408, October 6, 2008
Yamane v. B.A. Lepanto Condominium Corporation, 427 SCRA 258 (2005)
(c) Real Property Taxation (Sections 232-283, LGC)
Read also Sections 516, 517, 518, 519 on Penal Provisions, LGC.
Assessment and Appraisal (Sec. 201-231, LGC)
Principle: Special Education Fund is the share segregated in the proceeds
of real property taxes collected by the local government units.
Case:
Yujuico v. Atienza, , 472 SCRA 463
(d) Local governments share under NIRC
Internal Revenue Allocation (IRA) is the share of local government units in the
proceeds under the NIRC. (Sections 6 and 7, Art. X, Constitution, Sections 284-
294, LGC)
(e) Fiscal Autonomy and Self-Reliance of Local Governments
Case:
Smart Communications, Inc. v. Davao City, 565 SCRA 237 (2008)
(f) Credit Financing (Sections 295-303, LGC; Read also Section 520, LGC on
Prohibited Acts)
(g) Local Fiscal Administration (Sections 304-383, LGC)
4. Legislative Powers (Sections 48-59, LGC; Sec. 9, Art. X, 1987 Constitution)
Note: Apply the concept of delegated authority because all local governments
are under the executive branch and not the legislative branch of government.
(a) Rule on effectivity of ordinances: Unless otherwise stated in the ordinance,
local ordinances shall take effect after ten days (10) from posting. (Read
Section 511 of LGC on Posting and Publication of Ordinances with Penal
Provisions.)
(b) Law Making Capacity of LGUs: Quorum must exist to enact a law.
Requisites of a valid ordinance: Inclusion in Legislative Agenda,
Consideration, appropriate Legislative Council, Public Hearing where
necessary, and passage in three (3) readings, approval by Chief Local
Executive, Veto Power, Override Power,
Posting and Publication
Rules to be observed in VOTING:
Two-Thirds (2/3) Vote Required
Extending loans or entering into contracts;
Issuance of bonds or securities;
Authorizing the lease of public property;
Grant of franchises;
Creation of LGU liability or indebtedness
Over-ride the veto of the Mayor;
Grant of tax exemptions;
Levy of taxes;
Discipline / suspend a member of the sanggunian;
Opening or closing of roads;
Selection and transfer of government site or offices; and
Concurrence in the appointment of personnel
(DILG Opinion No. 107-2003, dated 15 August 2003)
To change the name of public structure will historical, cultural and
ethnic significance, a UNANIMOUS vote is required.
Distinction between an Ordinance and a Resolution
Rules governing the enactment of ordinances and resolutions (Art. 107,
Arts. 108 to 114, IRR, LGC)
(c) Local Initiative and Referendum (Sec. 120-127, Art. 133 to 153, IRR)
5. Corporate Powers (Sec. 22, LGC, Art. 46, IRR, Sections 14/15, LGC)
(a) Conditions under which a local executive may enter into a contract in behalf of
his government unit
Cases:
Vergara v. Ombudsman, 580 SCRA 693 (2009)
City of Caloocan v. CA and, Gotesco, G.R. No. 14500, May 31, 2006
(b) Authority to negotiate or secure grants and incurring indebtedness (Sec. 23, LGC)
(c) Build-Operate-Transfer (Sec. 302, LGC)
C. Privileges
1. Immunity from suit
Case:
Yujuico v. Atienza, , 472 SCRA 463
2. Personality to Appeal
Case:
Municipal Board of Cebu City v. Court of Tax Appeals, 12 SCRA 645
Calleja v. Court of Appeals, 20 SCRA 895
3. Hiring of Private Lawyers
Cases:
Province of Cebu v. IAC, 147 SCRA 447
Municipality of Pililla, Rizal v. C.A., 233 SCRA 484

VI. LIABILITIES OF MUNICIPAL CORPORATIONS
A. General Rule - Sec. 24, Local Government Code (LGC)
Exceptions as provided by law. Refer to Art. 34 and Art. 2189 Civil Code
Cases:
Teotico v. City of Manila, 22 SCRA 267 (1968)
Guilatco v. City of Dagupan, 171 SCRA 382 (1989)
B. Liability for torts, if engaged in proprietary function (Read Article 2180, Civil
Code)
Cases:
Palafox v. Province of lIocos Norte, 102 Phil. 1186 (1958)
Municipality of San Juan, Metro Manila v. C.A., 466 SCRA 78 (2005)
C. Liability under Contracts
Cases:
Vice Mayor Vicencio v. COA Chairman Villar et al., G.R. No. 182069, July 3,
2012
Municipality of Tiwi and Sangguniang Bayan of Tiwi v. Betito, G.R. No.
171873, July 9, 2010
Fajardo v. Hon. Alfredo S. Lim, G.R. No. 132388, April 10, 2006
D. Doctrine of implied municipal liability contra personal liability
General Rule: There is no personal liability in the discharge of official
functions but bad faith on the part of the public official may make him
personally liable.

VII. LINKAGES OF LOCAL GOVERNMENT UNITS WITH OTHER ENTITIES
A. Intergovernmental Relations of Public Corporations (Art. 59, 62, IRR)
1. Between the national government and other Iocal government units (Sec. 33,
LGC)
Cases:
Boracay Foundation, Inc. v. Province of Aklan, et al., G.R. No. 196870,
June 26, 2012
Filinvest Land Inc. v. Flood-affected Homeowners of Merville Alliance 529 SCRA
790 (2007)
Disomangcop v. Datumanong, supra
Province of Batangas v. Romulo, supra
Province of Rizal v. Executive Secretary, supra
Sampian v. Inda, 608 SCRA 597 (2009)
2. With Philippine National Police (Sec. 28, LGC)
Case:
De Villa et. al. v. The City of Bacolod, G.R. No. 80744, Sept. 20, 1990
3. With component cities and municipalities (Sec. 29, LGC)
B. Relations with People's and Non-Governmental Organizations (Sections 26, 27, 34,
35 and 36, LGC)

VIII. LOCAL SPECIAL BODIES (Art 181-188, IRR)
A. Local Development Councils (Sec.106, LGC)
B. Local Bids and Awards Committee (BAC) (Sections 37 and 38, LGC)
Case:
Sison v. People, G.R. No. 170339, March 9, 2010
C. Local School Board (Sec. 98, LGC)
Case:
Yujuico v. Atienza, 472 SCRA 463
D. Local Health Boards (Sec. 102, LGC)
E. Local Peace and Order Councils (Sec. 116. LGC)
F. People's Law Enforcement Board, Sec. 43, R.A. 6975
Case:
Carpio v. Executive Secretary, 206 SCRA 700
SPO 1Acuzar v. Jarolan and Hon. Apresa, PLEB, G.R. No. 177878, April 7, 2010
G. Liga ng mga Barangay
Cases:
Ignacio v. Banate, Jr., 153 SCRA 546
Galarosa v. Valencia, 227 SCRA 728
SB of Barangay Don Mariano Marcos v.Punong Barangay Severino Martinez
G.R. No. 170626, March 3, 2008

IX. EXERCISING GOOD GOVERNANCE AT THE LOCAL LEVEL
A. Requirements and Prohibitions applicable to all Local Officials and Employees
(Sections 90, 94, 95 Art. 177, 179, IRR)
B. ELECTIVE OFFICIALS
(1) Qualifications (Sections 39, 41 and 42, LGC
Cases:
Amora, Jr. v. COMELEC and Olandria, G.R. No. 192280, January 25, 2011
Valles v. COMELEC 337 SCRA 543 (2000)
Moreno v. COMELEC 498 SCRA 547
Rodriguez v. COMELEC 259 SCRA 296 (1996)
Mercado v. Manzano, 307 SCRA 630 (1999)
Abella v. COMELEC, 201 SCRA (1991)
Frivaldo v. COMELEC, 174 SCRA 253 (1996)
Labo, Jr. v. COMELEC, 176 SCRA 1 (1992)
(2) Disqualifications (Section 40, LGC)
Cases:
Dominador Jalosjos v. COMELEC and Cardino, G.R. No. 193237, October 9, 2012
Mayor Talaga v. COMELEC and Alcala, G.R. No. 196804, Oct. 9,2012
Cayat v. COMELEC, G. R. No. 163776, April 24, 2007
Bernardo et. al. v. Abalos et. al., G. R. No. 137266, December 5, 2004
(3) Vacancies and succession (Sections 44 to 46, R.A. 7160)
Cases:
Unda v. COMELEC, 190 SCRA 827
Macalingcag v. Chang, 208 SCRA 413
Permanent vacancies
Temporary vacancies
Resignation
(4) Recall (Sections 69 - 75, LGC and Art. 154 to 162, IRR)
Requisites
Who may be recalled
Grounds for recall
When recall may not be held
Procedure for recall
Effectivity of Recall
(5) Term Limits and Recall (See R.A. No.9244)
Cases:
Sandoval v. COMELEC, G.R. No. 154683, October 5, 1993
Montebon v. Commission on Elections, 551 SCRA 50 (2008)
Mendoza v. Familara and COMELEC, G.R. No. 191017, November 15, 2011
Mayor Abundo v. COMELEC, G.R. No. 201716, January 8, 2013
C. Supervision Over and Discipline of Local Officials
1. Applicability of R.A. 6770 - The Ombudsman Act of 1989
Cases:
Miranda v. Sandiganbayan, 464 SCRA 165 (2005)
Bolastig v. Sandiganbayan, 235 SCRA 103

2. Disciplinary Action (Art. 124, IRR)
Procedure in imposing disciplinary action (Sec. 84, LGC)
Grounds for suspension and removal (Sec. 60, LGC)
Preventive Suspension (Sections 63-64, 85-87, LGC and Art. 127, IRR)/
Jurisdiction of Ombudsman
Cases:
Ombudsman v. Rodriguez, G.R. No. 172700, July 23, 2010
Espiritu v. Melgar, 206 SCRA 256
Bunye v. Escareal, 226 SCRA 332

3. Rights of Respondent in Administrative Cases (Art. 129, IRR)
Case:
Mayor Tolentino v. COMELEC, et al., G.r. No.187958, 187961 and 187962,
August 10, 2010
Administrative Investigation and Appeals (Art. 131, IRR)(47)
Cases:
Catu v. Rellosa, 546 SCRA 209 (2008)
Republic v. Rambuyong, 632 SCRA 66 (2010)
People v. Sandiganbayan, 559 SCRA 449 (2008)
Sales v. Carreon, Jr. 515 SCRA 597 (2007)
Nazareno v. City of Dumaguete, 602 SCRA 578 (2009)
Montuerto v. Ty, 567 SCRA 670 (2008)

X. BARANGAY JUSTICE (Sections 399 to 420, LGC)
Cases:
Uy v. Contreras, 237 SCRA 167 (1994)
Corpuz v. C.A., 274 SCRA 275 (1997)

XI. ACTS PUNISHABLE UNDER THE LOCAL GOVERNMENT CODE
See Penal Provisions (Sections 511-520, LGC)
a. Matters related to publication and posting
Section 511 Posting and Publications of Ordinances with Penal Sanctions
Section 513 Failure to Post and Publish the Itemized Monthly Collections and
Disbursements
b. Matters related to local tax measures
Section 516 Penalties for Violation of Tax Ordinances
Section 517 Omission of Property from Assessment or Tax Rolls by Officers
and other Acts
Section 518 Government Agents Delaying Assessment of Real Property and
Assessment Appeals
Section 519 Failure to Dispose of Delinquent Property at Public Auction
c. Matters related to Barangay Affairs
Section 512 Withholding of Benefits Accorded to Barangay Officials
Section 515 Refusal or Failure of Any Party or Witness to Appear before the
Lupon or Pangkat
d. Prohibitions on Local Government Officials and Staff
Section 514 Engaging in Prohibited Business Transactions or Possessing Illegal
Pecuniary Interests
Section 520 Prohibited Acts Related to the Award of contracts under the
Provisions of Credit Financing
E. Miscellaneous Provisions
Section 521 5-year Mandatory Review of the LGC
Section 522 GSIS Coverage of Barangay Officials
Section 523 Receipt of Personnel Retirement and/or Benefits of Affected
Employees upon effectivity of the LGC
Section 524 Periodic Inventory of Infrastructure and other Community
Facilities
Section 525 Transfer of Records and Properties affected by the Adoption of
the LGC
Transitory Provisions (Sections 526-533, LGC)
Section 526 Applicability of LGC to Autonomous Regions
Section 527 Treatment of Regular and Recurring Transactions
Section 528 Decentralization of Powers from National Government Agencies
Section 529 Treatment of Existing Tax Ordinances or Revenue Measures
Section 530 Devolution of Powers to Local Water Districts
Section 531 Debt Relief for Local Government Units
Course Expectations
1. Every member of the class is expected to be familiar with the provisions of Art. X of
the Constitution and the Local Government Code.
2. Everyone is expected to read assigned cases.
3. Make up classes will be resorted to if cancellation of regular classes is made during the
semester.
4. Schedule of final examinations will be strictly observed.
References:
BASIC LAWS:
1. Relevant Provisions of the 1987 Constitution
2. Relevant Provisions of the Civil Code
3. Local Government Code of 1991, RA 7160
4. Relevant Laws on Public Accountability including the provisions of the Revised
Penal Code
Published Books:
1. Martin, Ruperto G., Public Corporations
2. Pimentel, Aquilino, Jr. Q., The Local Government Code of 1991
3. Sinco, Vicente G. and Cortes, Irene R, Philippine Law on Local Government