G.R. No. 175064; September 18, 2009
PROVINCE OF CAMARINES SUR, represented by Governor LUIS RAYMUND F. VILLAFUERTE, Jr., Petitioner, vs. HONORABLE COURT OF APPEALS; and CITY OF NAGA, represented by Mayor JESSE M. ROBREDO, Respondents.

FACTS

The case involves a dispute over the administrative control and management of Plaza Rizal, a 4,244-square-meter parcel of land located in front of the old provincial capitol in Naga City. The City of Naga filed a Complaint for Declaratory Relief and/or Quieting of Title against the Province of Camarines Sur. The City alleged that while the Province possessed the property based on a tax declaration and exercised administrative control, the Plaza is situated within the City’s territorial jurisdiction. The City sought a judicial declaration that administrative control should be vested in it, invoking its charter (Republic Act No. 305), and stressed it did not claim ownership, recognizing the property as one for public use. The Province, in its Answer, asserted absolute ownership and the concomitant right to manage the Plaza, arguing the City had no cause of action and that the remedies sought were inappropriate.

ISSUE

The core issue is whether the City of Naga, by virtue of its territorial jurisdiction over the situs of Plaza Rizal, has the right to administrative control and management of the property, notwithstanding the Province of Camarines Sur’s claim of ownership.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals’ decision upholding the Regional Trial Court’s ruling in favor of the City of Naga. The legal logic centers on the distinction between ownership and the right of control incidental to territorial jurisdiction. The Court clarified that the City’s action was not to claim ownership but to assert its right to regulate and administer properties within its territory for the benefit of its constituents. Since the Province admitted that Plaza Rizal is within the territorial jurisdiction of Naga City, the City, as a local government unit, possesses the inherent power grounded in its charter and the Local Government Code to exercise administrative supervision over properties located therein. This right of local supervision is a component of its territorial jurisdiction and is separate from the question of proprietary title. The Province’s claim of ownership, while potentially valid, does not negate the City’s authority to manage and control the public plaza in line with its governmental functions. The propriety of the action for declaratory relief was sustained as there existed a justiciable controversy regarding the clash of administrative rights between the two local government units.