G.R. No. 132834; November 24, 2006
Ruperto Lucero, Jr., Pablo Lucero and Antonio Tenorio, Petitioners, vs. City Government of Pasig, as represented by the Market Administrator, Respondent.

FACTS

Petitioners were stallholders in the Pasig Public Market under lease contracts granted by Municipal Ordinance No. 25, series of 1983. In 1993, following market renovations, the Sangguniang Bayan enacted Municipal Ordinance No. 56, prescribing new rules for stall occupancy, including the submission of new application forms and payment of a performance bond. Petitioners refused to comply with these new requirements, maintaining that their existing 1983 contracts remained valid. The City Government subsequently filed an ejectment case, alleging petitioners’ failure to pay rentals since January 1994 and to post the required bond.
In their defense, petitioners claimed they had attempted to pay rentals but were refused by the city treasurer due to their non-compliance with the new ordinance. They argued that their rights under the 1983 contracts were vested and could not be impaired by the later ordinance. The Metropolitan Trial Court ruled in favor of petitioners, but this was reversed on appeal by the Regional Trial Court, which ordered petitioners to vacate and pay arrears. The Court of Appeals affirmed the RTC decision.

ISSUE

Whether petitioners possess a vested right to occupy their market stalls under the 1983 lease contracts, rendering Municipal Ordinance No. 56, series of 1993, inapplicable to them.

RULING

The Supreme Court denied the petition and affirmed the assailed decisions. The Court held that petitioners did not possess a vested right to the stalls. A vested right is a present, fixed interest protected against arbitrary state action, complete and not dependent on a contingency. The lease and occupation of a stall in a public market is not a right but a statutory privilege governed by ordinances.
The 1983 lease contracts merely granted petitioners a revocable license or privilege to occupy the stalls for a period, not an absolute or fixed property interest. The enactment of Municipal Ordinance No. 56, which repealed the prior ordinance, was a valid exercise of the local government’s police power to regulate the use of public market facilities. As such, petitioners were required to comply with the new regulations, including the application process and bond requirement. Their failure to do so justified their lawful ejectment. The Court emphasized that the privilege could be altered or withdrawn by the state in accordance with law and public welfare.