Rimando vs. Naguilian Emission Testing Center, Inc.

Mandamus does not lie to compel the issuance of a business permit by a municipal mayor because the power to issue permits is an exercise of delegated police power and is therefore discretionary, not ministerial.

Naguilian Emission Testing Center, Inc. operated an emission testing business on a parcel of land in Naguilian, La Union, certified by the DENR as alienable and disposable public land, from 2005 to 2007. On January 18, 2008, the company applied for the renewal of its business permit and paid the corresponding fees. Mayor Abraham Rimando refused to issue the permit unless the company executed a lease contract with the Municipality of Naguilian. The company was amenable to signing the contract subject to proposed revisions, which the mayor rejected, resulting in an impasse.

• Business Permit Application: Respondent Naguilian Emission Testing Center, Inc. filed an application for the renewal of its business permit on January 18, 2008, and paid the corresponding fees.
• Mayor's Refusal: Petitioner Mayor Abraham Rimando refused to issue the business permit unless respondent executed a contract of lease with the Municipality of Naguilian.
• Impasse: Respondent was amenable to signing the lease contract but proposed certain revisions. Petitioner found the revisions unacceptable, and the parties failed to reach an agreement.
• RTC Ruling: The RTC denied respondent's petition for mandamus, ruling that the municipality owned the land by virtue of a tax declaration, justifying the lease requirement under the Municipal Revenue Code, and that a mayor's duty to issue business permits is discretionary.
• CA Ruling: The CA found the case moot due to the lapse of the permit period but ruled on the merits for academic purposes, reversing the RTC. It held that the tax declaration was insufficient to require a lease contract and that the Sangguniang Bayan Resolution imposing rental fees was void. However, the CA absolved the petitioner of damages due to the presumption of good faith and the mootness of the civil action against him.

• Improper Remedy: Petitioner argued that a petition for mandamus is not the proper vehicle to determine the issue of ownership of the subject land.
• Validity of Resolution: Petitioner contested the CA's pronouncement declaring Sangguniang Bayan Resolution No. 2007-81 void.

• Propriety of Mandamus: Respondent claimed entitlement to the business permit, arguing that the tax declaration in the municipality's name was insufficient basis to require a lease contract as a condition sine qua non for the permit's renewal.
• Invalidity of Resolution: Respondent contended that Sangguniang Bayan Resolution No. 2007-81 was void for failing to comply with the Local Government Code and its Implementing Rules and Regulations.

• Mootness: Whether the petition for mandamus has become moot and academic.
• Propriety of Mandamus: Whether mandamus is the proper remedy to compel a municipal mayor to issue a business permit.

• Mootness: The petition was rendered moot by the expiration of the business permit period sought (2008-2009) and the expiration of the petitioner's term as mayor. Any ruling on the matter would serve no practical value, as the permit's effectivity no longer subsists and the mayor can no longer abide by the writ. The CA should have dismissed the appeal on the ground of mootness rather than reversing the RTC on the merits.
• Propriety of Mandamus: Mandamus does not lie to compel the issuance of a business permit. The mayor's power to issue permits under Section 444(b)(3)(iv) of the Local Government Code is an exercise of delegated police power pursuant to Section 16, the general welfare clause, and is thus discretionary, not ministerial. Certiorari, not mandamus, is the proper remedy to question the validity of the exercise of such power.

• Moot and Academic Doctrine — A case becomes moot and academic when it ceases to present a justiciable controversy such that any determination would be without practical use or value, or cannot be enforced. Courts generally decline jurisdiction over such cases. Applied to dismiss the petition, as the business permit period and the mayor's term had already lapsed, rendering any ruling without practical effect.
• Delegated Police Power of LGUs (General Welfare Clause) — Section 16 of the Local Government Code encapsulates the delegated police power to local governments. The power of a municipal mayor to issue licenses and permits under Section 444(b)(3)(iv) is a manifestation of this delegated police power, making the exercise thereof discretionary, not ministerial. Applied to rule that mandamus cannot compel the issuance of a business permit.

• "Section 444(b)(3)(iv) of the Local Government Code of 1991, whereby the power of the respondent mayor to issue license and permits is circumscribed, is a manifestation of the delegated police power of a municipal corporation. Necessarily, the exercise thereof cannot be deemed ministerial. As to the question of whether the power is validly exercised, the matter is within the province of a writ of certiorari, but certainly, not of mandamus."

• Roble Arrastre, Inc. v. Hon. Villaflor, 531 Phil. 30 (2006) — Controlling precedent followed. Established that a mayor's power to issue business permits is an exercise of delegated police power and is discretionary; mandamus will not lie, but certiorari is the proper remedy to question the validity of the power's exercise.

• Section 444(b)(3)(iv), Republic Act No. 7160 (Local Government Code of 1991) — Defines the power of the municipal mayor to issue licenses and permits and suspend or revoke the same for violations of conditions, pursuant to law or ordinance. Applied to demonstrate that this power is discretionary, being rooted in the municipality's delegated police power.
• Section 16, Republic Act No. 7160 (Local Government Code of 1991) — The General Welfare Clause. Declares that LGUs exercise powers necessary for efficient and effective governance and the promotion of the general welfare. Applied as the constitutional and statutory basis for the delegated police power of local governments.

Antonio T. Carpio, Mariano C. del Castillo, Jose Portugal Perez, Maria Lourdes P.A. Sereno