ONGSUCO vs MALONES (ADMINISTRATIVE LAW)

EVELYN ONGSUCO and ANTONIA SALAYA, Petitioners, - versus - HON. MARIANO M. MALONES, both in his private and official capacity as Mayor of the Municipality of Maasin, Iloilo, Respondent.

G.R. No. 182065 Present: QUISUMBING,* J., CARPIO, Chairperson, CHICO-NAZARIO, PERALTA, and ABAD,** JJ. Promulgated: October 27, 2009

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D E C I S I O N

CHICO-NAZARIO, J.:

FACTS:

On 17 August 1998, the Sangguniang Bayan of Maasin approved Municipal Ordinance No. 98-01, entitled The Municipal Revised Revenue Code. The Code contained a provision for increased rentals for the stalls and the imposition of goodwill fees in the amount of P20,000.00 and P15,000.00 for stalls located on the first and second floors of the municipal public market, respectively. The same Code authorized respondent to enter into lease contracts over the said market stalls,[5]and incorporated a standard contract of lease for the stall holders at the municipal public market.

Petitioners argued that public hearing was mandatory in the imposition of goodwill fees. Section 186 of the Local Government Code of 1991 provides that an ordinance levying taxes, fees, or charges shall not be enacted without any prior hearing conducted for the purpose. Municipal Ordinance No. 98-01, imposing goodwill fees, is invalid on the ground that the conferences held on 11 August 1998and 22 January 1999 could not be considered public hearings. According to Article 277(b)(3) of the Implementing Rules and Regulations of the Local Government Code:

(3) The notice or notices shall specify the date or dates and venue of the public hearing or hearings. The initial public hearing shall be held not earlier than ten (10) days from the sending out of the notice or notices, or the last day of publication, or date of posting thereof, whichever is later. (Emphasis ours.)

The letter from the Office of the Municipal Mayor was sent to stall holders on 6 August 1998, informing the latter of the meeting to be held, as was in fact held, on 11 August 1998, only five days after notice.[12]

ISSUE:

WHETHER OR NOT EXHAUSTION OF ADMINISTRATIVE REMEDIES IS APPLICABLE IN THIS CASE; AND

RULING:

After a close scrutiny of the circumstances that gave rise to this case, the Court determines that there is no need for petitioners to exhaust administrative remedies before resorting to the courts.

It is true that the general rule is that before a party is allowed to seek the intervention of the court, he or she should have availed himself or herself of all the means of administrative processes afforded him or her. Hence, if resort to a remedy within the administrative machinery can still be made by giving the administrative officer concerned every opportunity to decide on a matter that comes within his or her jurisdiction, then such remedy should be exhausted first before the courts judicial power can be sought. The premature invocation of the intervention of the court is fatal to ones cause of action. The doctrine of exhaustion of administrative remedies is based on practical and legal reasons. The availment of administrative remedy entails lesser expenses and provides for a speedier disposition of controversies. Furthermore, the courts of justice, for reasons of comity and convenience, will shy away from a dispute until the system of administrative redress has been completed and complied with, so as to give the administrative agency concerned every opportunity to correct its error and dispose of the case.However, there are several exceptions to this rule. [26]

The rule on the exhaustion of administrative remedies is intended to preclude a court from arrogating unto itself the authority to resolve a controversy, the jurisdiction over which is initially lodged with an administrative body of special competence. Thus, a case where the issue raised is a purely legal question, well within the competence; and the jurisdiction of the court and not the administrative agency, would clearly constitute an exception.[27] Resolving questions of law, which involve the interpretation and application of laws, constitutes essentially an exercise of judicial power that is exclusively allocated to the Supreme Court and such lower courts the Legislature may establish. [28]

In this case, the parties are not disputing any factual matter on which they still need to present evidence. The sole issue petitioners raised before the RTC in Civil Case No. 25843 was whether Municipal Ordinance No. 98-01 was valid and enforceable despite the absence, prior to its enactment, of a public hearing held in accordance with Article 276 of the Implementing Rules and Regulations of the Local Government Code. This is undoubtedly a pure question of law, within the competence and jurisdiction of the RTC to resolve.