FASTLANES
by BenCy Ellorin/July 20, 2024

CAGAYAN DE ORO CITY — Thirty years ago today, a landmark decision of the Supreme Court on the limits of local ordinances was handed down.

In the case Magtajas vs Pryce Properties Corp. Inc. and PAGCOR (G.R. No. 111097), the Supreme Court ruled against the city ordinances that prohibited the operation of a Casino in Cagayan de Oro City.

The company, however, made the moral decision by listening to the people. It did not push through with its Casino business. And the rest is history — the proudly Cagayanon company has been blessed. It is now a PH Stock Exchange-listed company worth billions.

The case was for the prohibition of the implementation of two city ordinances:

1) ORDINANCE NO. 3353

AN ORDINANCE PROHIBITING THE ISSUANCE OF BUSINESS PERMIT AND CANCELLING EXISTING BUSINESS PERMIT TO ANY ESTABLISHMENT FOR THE USING AND ALLOWING TO BE USED ITS PREMISES OR PORTION THEREOF FOR THE OPERATION OF CASINO.

and

2) AN ORDINANCE PROHIBITING THE OPERATION OF CASINO AND PROVIDING PENALTY FOR VIOLATION THEREFOR.

These ordinances supported the Church-led people’s protest against the proposed Casino by the Philippine Amusement and Gaming Corp. (Pagcor) at the Pryce Plaza Hotel.

Pryce Properties Corporation, owner of Pryce Plaza Hotel assailed the ordinances as invalid before the Court of Appeals (CA), praying that the court issue an order to prohibit the enforcement of the two ordinances, arguing that the local government cannot make illegal what is deemed legal by a national law.

The company got a favorable decision at the CA.

Then comes Mayor Pablo Magtajas, representing the people of Cagayan de Oro challenging the appellate court’s decision. The city government asked the court for review, arguing that local governments are authorized to regulate properties and businesses within their territorial limits in the interest of the general welfare, as provided in Section 16 of the Local Government Code.

The Supreme Court ruled that “Casino gambling is authorized by P.D. 1869. This decree has the status of a statute that cannot be amended or nullified by a mere ordinance. Hence, it was not competent for the Sangguniang Panlungsod of Cagayan de Oro City to enact Ordinance No. 3353 prohibiting the use of buildings for the operation of a casino and Ordinance No. 3375-93 prohibiting the operation of casinos. For all their praiseworthy motives, these ordinances are contrary to P.D. 1869 and the public policy announced therein and are therefore ultra vires and void.”

The ruling in this case enriched Philippine jurisprudence by upholding the well-established tests for a valid ordinance which are the following:

1) It must not contravene the constitution or any statute.

2)  It must not be unfair or oppressive.

3) It must not be partial or discriminatory.

4) It must not prohibit but may regulate trade.

5) It must be general and consistent with public policy.

6) It must not be unreasonable.

As an exemplary act of good corporate citizenship, the owners of Pryce Corporation decided to put off the Casino project in recognition of the palpable will of the people of Cagayan de Oro City.

Protests were held in 1993 and 1994 at the entrance of the Pryce Plaza Hotel in upper Carmen, led by no less than Mayor Magtajas and Archbishop Jesus Tuquib.

While the company’s hotel business did not flourish, with the closure of the iconic Pryce Plaza Hotel on Dec. 31, 2016, they were blessed with the exponential growth of their other businesses.

Led by Salvador P. Escano, the subsidiaries of the Pryce Corporation, Pryce Gases Inc. (PGI), and Oro Oxygen Corp. (OOC), were positioned to fill in the LPG supply gap in Luzon when Shell’s LPG terminal in Batangas closed in 2014. In 2016, the Kagay-anon company’s LPG Terminal in San Fabian, Pangasinan, one of the biggest LPG terminals in the country in San Fabian, Pangasinan started operations.

A Philippine Stock Exchange-listed company, Pryce Corp. continues to grow. Its 31.6% growth in 2023 was driven by Liquefied Petroleum Gas (LPG) sales. Pryce Gas is now one of the biggest LPG brands in the country.

This should be a lesson to other big companies.

We can only wish that Metro Pacific Water listens to the people of Cagayan de Oro. No less than Mayor Klarex Uy had asked for the reformation of the onerous provisions of the 2017 bulk water supply contract between the Metropac-owned Cagayan de Oro Bulkwater Inc. (COBI) and the Cagayan de Oro City Water District (COWD).

Like Mayor Magtajas then, Mayor Klarex is standing up for the people. The citizen’s watchdog Bantay Tubig Movement has gathered 17,000 signatures to call for reforms in the COBI-COWD contract.