Letter-Request for Ruling and Confirmation of Opinion on the Proper Interpretation of Section 187 of the Local Government Code

May 17, 2016 BUREAU OF LOCAL GOVERNMENT FINANCE OPINION CO-LFPS-PPPSD Atty. Rester John L. Nonato Legal Representative Velez College, Inc. 4F Tulips Center A.S. Fortuna St., Mandaue City Cebu SUBJECT : Letter-Request for Ruling and Confirmation of Opinion on the Proper Interpretation of Section 187 of the Local Government Code Dear Atty. Nonato : This refers to your letter dated March 24, 2016 requesting on behalf of Velez College, Inc. ("VCI"), confirmation and ruling of your opinion on the following: HTcADC 1. Whether or not Section 187 of Local Government Code grants exclusive jurisdiction to Department of Justice to rule on the validity of tax ordinances; 2. Whether or not the ruling of Department of Justice on the validity of tax ordinances is a mere opinion or a definite one; 3. Whether or not the failure to file an appeal to a court of competent jurisdiction per Section 187 of Local Government Code within 30 days from the receipt of the decision of the Department of Justice or after the lapse of the 60-day period from the inaction of Department of Justice would render said ruling by DOJ, final and executory; 4. Whether or not the filing of a Motion for Reconsideration before the Department of Justice an improper remedy under Section 187 of the Local Government Code as the same is not tantamount to appeal to a Court of competent jurisdiction required under the aforesaid provision of the law; 5. If enforcing a tax ordinance declared null and void by the Department of Justice after failing to appeal in a court of competent jurisdiction would expose the administrative officials enforcing the same to administrative sanctions per Section 187 of the Local Government Code. The above-request was made in view of the claim that despite the declaration of nullity of Tax Ordinance CTO CXIII due to its procedural infirmity by the Department of Justice in MTO OSJ Case No. 13-2006, dated January 22, 2007, the City of Cebu still sought the enforcement of said void tax ordinance and issued a Notice of Assessment to VCI dated October 20, 2010. Said Notice includes the summary of alleged taxes and fees payable for calendar year 2000-2010 in the amount of Php20,503,618.20 claiming further that prior to the enactment of Tax Ordinance No. CTO CXIII, there was no Ordinance by the City of Cebu specifically taxing educational institutions. Said letter was referred to the City Treasurer of Cebu for comment under 1st Indorsement dated July 1, 2013 which was forwarded to the City Attorney for comments and opinion. Under a letter dated 18 July 2013, the City Attorney informed this Bureau that the matters raised before us are among the issues raised in at least three (3) cases before the Regional Trial Court in Cebu City, and one (1) case before the 20th Division of the Court of Appeals, also in Cebu City. In this connection and as a sort of reiteration, this Bureau regrets to decline to issue comments thereon, the same being "sub judice." Very truly yours, (SGD.) JOCELYN T. PENDON OIC-Executive Director