Subic Bay Metropolitan Authority vs. Commission on Elections

The Commission on Elections commits grave abuse of discretion when it erroneously treats a local initiative as a referendum, as the two processes entail distinct statutory and conceptual demarcations requiring different procedural safeguards, and the COMELEC possesses the initiatory quasi-judicial jurisdiction to pass upon the form, language, and patently ultra vires content of a proposed local initiative before its submission to the electorate.

On March 13, 1992, Congress enacted Republic Act No. 7227, creating the Subic Special Economic Zone (SSEZ) subject to the concurrence, by resolution, of the Sangguniang Panlungsod of Olongapo and the Sangguniang Bayan of the Municipalities of Subic, Morong, and Hermosa. In April 1993, the Sangguniang Bayan of Morong, Bataan passed Pambayang Kapasyahan Blg. 10, Serye 1993, expressing its absolute concurrence to join the SSEZ. Private respondents Garcia, Calimbas, and others, dissatisfied with the unconditional concurrence, petitioned the Sangguniang Bayan to annul the resolution and replace it with a conditional concurrence imposing several demands, including the return of the "Virgin Forests" and Grande Island to Bataan, revenue sharing based on land area, and representation in the SBMA. The Sangguniang Bayan responded by enacting Pambayang Kapasyahan Blg. 18, Serye 1993, requesting Congress to amend certain provisions of RA 7227. Unsatisfied, private respondents invoked their power of local initiative under the Local Government Code to propose the annulment and conditional replacement of the original resolution.

• Creation of the SSEZ: Congress enacted RA 7227, creating the Subic Special Economic Zone and the Subic Bay Metropolitan Authority (SBMA). Section 12 of the law required the concurrence of the Sangguniang Bayan of Morong, Bataan, among other local government units, to join the zone. The Republic of the Philippines fully paid the P20 billion authorized capital stock of SBMA with, among other assets, the lands embraced and defined in Section 12, including Grande Island and the virgin forests within Morong's territorial jurisdiction.
• Morong's Concurrence: In April 1993, the Sangguniang Bayan of Morong passed Pambayang Kapasyahan Blg. 10, Serye 1993, expressing its absolute concurrence to join the SSEZ. On September 5, 1993, the Sangguniang Bayan submitted the resolution to the Office of the President. On February 1, 1995, the President issued Proclamation No. 532 defining the metes and bounds of the SSEZ, including the lands within the former Subic Naval Base situated in Morong.
• Private Respondents' Demands: On May 24, 1993, respondents Garcia and Calimbas filed a petition with the Sangguniang Bayan to annul the absolute concurrence and replace it with a conditional concurrence. Their demands included returning the "Virgin Forests" and Grande Island to Bataan, including Bataan lands in IRA computations, allowing the establishment of separate special economic zones, basing SBMA revenue and job allocation on land area, keeping SBMA gates open 24 hours, completing road concreting, and securing Morong, Hermosa, and Bataan representation in the SBMA.
• Sangguniang Bayan Action: The Sangguniang Bayan enacted Pambayang Kapasyahan Blg. 18, Serye 1993, requesting Congress to amend RA 7227 based on the private respondents' demands, and informed respondents that certain other demands had been referred to the Bases Conversion Development Authority and the Office of the President.
• Initiative Process and COMELEC Error: Unsatisfied with the Sangguniang Bayan's response, private respondents invoked their power of local initiative under Section 122(b) of the Local Government Code. After the prior Garcia case established that a resolution could be the subject of an initiative, the COMELEC issued Resolution No. 2848. However, the COMELEC erroneously labeled and governed the entire exercise as a "referendum," using the term 27 times in the resolution's body without once using the word "initiative," and structured the ballots and committees accordingly.

• Petitioner argued that the COMELEC committed grave abuse of discretion in scheduling a local initiative that seeks the amendment of a national law (RA 7227).
• Petitioner maintained that the proposed initiative is ultra vires or beyond the powers of the Sangguniang Bayan to enact, because the creation of the SSEZ is a fait accompli and a national concern, and the specific conditionalities (e.g., segregating Grande Island, which is owned by the national government) are beyond the municipal council's legislative competence to impose. Accordingly, a local initiative cannot enact ordinances or resolutions that the municipal council itself could not enact.

• Private respondent Garcia countered that the petition seeks to overturn a decision (G.R. No. 111230) that has long become final and executory.
• Garcia further argued that the COMELEC acted within its jurisdiction and did not abuse its discretion.
• On the ultra vires issue, Garcia contended that petitioner's argument is premature and conjectural because the resolution is merely a proposal at this stage; should the people reject it, there would be nothing to declare illegal.
• Private respondent Calimbas joined petitioner's cause, stating that after consultation with SBMA, he discovered the demands in the petition for local initiative were not legally feasible.

• Procedural Issues:
  • Whether the present petition seeks to overturn a decision or judgment that has long become final and executory (G.R. No. 111230).
• Substantive Issues:
  • Whether the COMELEC committed grave abuse of discretion in promulgating and implementing Resolution No. 2848, which governed the conduct of the exercise as a referendum rather than an initiative.
  • Whether the questioned local initiative covers a subject within the powers of the people of Morong to enact, i.e., whether the initiative seeks the amendment of a national law or is otherwise ultra vires.

• Procedural: The Court held that the earlier Garcia case does not bar the present petition. The sole issue resolved in Garcia was whether a municipal resolution, as contradistinguished from an ordinance, could be the proper subject of an initiative. The present case presents a different issue: whether Pambayang Kapasyahan Blg. 10, Serye 1993, as worded, is sufficient in form and substance for submission to the people, and whether the COMELEC acted properly in promulgating Resolution No. 2848.
• Substantive: The Court ruled that the COMELEC committed grave abuse of discretion in promulgating Resolution No. 2848. There are statutory and conceptual demarcations between an initiative and a referendum. Initiative is the power of the people to propose and enact legislation directly, without the participation of their elected representatives; referendum is the power of the electorate to approve or reject legislation already enacted by a legislative body. Because an initiative is entirely the work of the electorate, the COMELEC must supervise it more closely, ensuring the proposition is in proper form and language, broken down into autonomous parts if lengthy, and limited to one subject. By treating the initiative as a simple referendum, the COMELEC failed to apply the necessary procedural safeguards. Regarding the ultra vires issue, the Court declined to rule on the ground of prematurity. The proposal is still in the initiatory stage, and courts may decide only actual controversies, not hypothetical questions. However, the Court held that the COMELEC possesses the administrative and initiatory quasi-judicial jurisdiction to pass upon the proposal's form and language, and even its content where the proposals are patently and clearly outside the capacity of the local legislative body to enact. The matter was remanded to the COMELEC for such determination.

• Distinction Between Initiative and Referendum — Initiative is the power of the people to propose amendments to the Constitution or to propose and enact legislations through an election called for the purpose. It is entirely the work of the electorate, undertaken without the participation and against the wishes of elected representatives. Referendum is the power of the electorate to approve or reject a legislation through an election called for the purpose; it is begun and consented to by the law-making body, consisting merely of the electorate approving or rejecting what has been drawn up or enacted by a legislative body. The process and voting in an initiative are understandably more complex than in a referendum. The Court applied this doctrine to hold that the COMELEC gravely abused its discretion by mislabeling the exercise and failing to apply the stricter supervisory requirements necessitated by an initiative.
• COMELEC's Quasi-Judicial Jurisdiction over Proposed Initiatives — While regular courts may take jurisdiction over approved propositions pursuant to Section 18 of RA 6735, the COMELEC, in the exercise of its quasi-judicial and administrative powers, has the jurisdiction to adjudicate and pass upon proposed initiatives insofar as their form and language are concerned, and even as to content where the proposals or parts thereof are patently and clearly outside the capacity of the local legislative body to enact. The Court applied this doctrine by remanding the case to the COMELEC, directing the Commission to hear the parties and determine the sufficiency of the proposal's form, language, and substantive competence before its submission to the electorate.

• "Initiative is a process of law-making by the people themselves without the participation and against the wishes of their elected representatives, while referendum consists merely of the electorate approving or rejecting what has been drawn up or enacted by a legislative body."
• "While regular courts may take jurisdiction over 'approved propositions' per said Sec. 18 of R.A. 6735, the Comelec in the exercise of its quasi-judicial and administrative powers may adjudicate and pass upon such proposals insofar as their form and language are concerned, as discussed earlier; and it may be added, even as to content, where the proposals or parts thereof are patently and clearly outside the 'capacity of the local legislative body to enact.'"

• Enrique T. Garcia, et al. vs. Commission on Elections, et al. — 237 SCRA 279 (1994). Controlling precedent on the propriety of a municipal resolution as a subject of initiative. The Court distinguished this case, clarifying that while Garcia resolved the form of the subject (resolution vs. ordinance), the present case involves the sufficiency of the proposal's wording and the COMELEC's procedural errors.
• In Re Guarina — Cited for the statutory construction principle that if an enactment is susceptible of two constructions, the interpretation that avoids unconstitutionality will be adopted. The Court relied on this in the earlier Garcia case to hold that "act" in the Constitution includes resolutions, thereby harmonizing the Local Government Code with the Constitution.

• Section 12, Republic Act No. 7227 — Provided for the creation of the Subic Special Economic Zone, requiring the concurrence of the Sangguniang Bayan of Morong. Applied to establish that the zone's creation and the inclusion of national government assets (like Grande Island) were facts relevant to determining whether the local initiative was ultra vires.
• Section 3, Republic Act No. 6735 (Initiative and Referendum Act) — Defined "Initiative" and "Referendum." Applied to delineate the conceptual and statutory differences between the two processes and to demonstrate that the COMELEC committed grave abuse of discretion by mislabeling the exercise.
• Section 120, Republic Act No. 7160 (Local Government Code) — Defined "Local Initiative" as the legal process whereby registered voters may directly propose, enact, or amend any ordinance. Applied to determine the proper process for the people of Morong to propose legislation.
• Section 126, Republic Act No. 7160 — Defined "Local Referendum" as the legal process whereby registered voters may approve, amend, or reject any ordinance enacted by the sanggunian. Applied to contrast with local initiative.
• Section 32, Article VI, 1987 Constitution — Mandates Congress to provide for a system of initiative and referendum whereby the people can directly propose and enact laws or approve or reject any act or law passed by Congress or local legislative bodies. Relied upon to justify a liberal construction of initiative and referendum laws to effectuate the people's right to direct democracy.

Narvasa, C.J., Padilla, Regalado, Davide, Jr., Bellosillo, Melo, Vitug, Kapunan, Francisco, Hermosisima, Jr., Torres, Jr.