GR L 30727; (July 1975) (Digest)
G.R. No. L-30727 July 15, 1975
THE CITY OF OZAMIZ, Represented by THE CITY MAYOR, MUNICIPAL BOARD, CITY TREASURER, and CITY AUDITOR, petitioner-appellant, vs. SERAPIO S. LUMAPAS and HONORABLE GERONIMO R. MARAVE, respondents-appellees.
FACTS
The Municipal Board of Ozamiz City enacted Ordinance No. 466, imposing daily parking fees on motor vehicles using designated city parking areas. Respondent Serapio S. Lumapas, a bus operator, paid the fees under protest from October 1964 to January 1967, totaling P1,243. The ordinance defined “parking” to include stopping for loading and unloading passengers or cargo. The designated area was part of a city-owned market site, a property held in the city’s proprietary capacity. Lumapas later filed a complaint seeking to nullify the ordinance and recover the fees paid, arguing the ordinance was ultra vires.
ISSUE
Whether the City of Ozamiz, through Ordinance No. 466, validly exercised its power to impose parking fees on motor vehicles using a city-owned property.
RULING
The Supreme Court affirmed the lower court’s decision declaring Ordinance No. 466 null and void. The legal logic rests on distinguishing the city’s governmental and proprietary capacities. The power to regulate the use of streets and public places under the city’s charter is a governmental function aimed at ensuring public safety and order, not revenue generation. Here, the ordinance imposed a fee for the use of a property the city owned in its proprietary capacity—a market site. While a city may charge fees for the use of its proprietary properties, such charges must be reasonable compensation for the use of the facility or service provided. The Court found the ordinance was not a valid exercise of the city’s proprietary power because the fee was imposed on vehicles merely stopping to load and unload, an activity essential to a public utility’s operation and already regulated for public safety. The charge functioned as a revenue measure on a necessary operational activity, not as a fair rental for the use of a special facility. Consequently, the ordinance was an invalid imposition, and the collected fees were ordered returned to Lumapas.