Challenging Real Property Tax Ordinances: Public Hearings and Publication Requirements

The Supreme Court's decision in Figuerres v. Court of Appeals (G.R. No. 119172, March 25, 1999) clarifies the procedural requirements for enacting real property tax ordinances and the remedies available to property owners who wish to challenge them. The case is instructive for landowners and local governments alike, as it addresses public hearing requirements, publication rules, and the doctrine of exhaustion of administrative remedies.

The Facts of the Case

Belen Figuerres owned a residential lot in Mandaluyong. In 1993, she received a notice of assessment from the municipal assessor, reflecting a new assessed value based on three ordinances enacted by the Sangguniang Bayan: Ordinance No. 119 (schedule of fair market values), Ordinance No. 125 (assessment levels), and Ordinance No. 135 (implementing the increase in market values over three years).

Figuerres filed a prohibition suit before the Court of Appeals, arguing that the ordinances were invalid because they were adopted without public hearings, without prior publication or posting, and without compliance with Department of Finance regulations. The Court of Appeals dismissed the petition for failure to exhaust administrative remedies. The Supreme Court affirmed.

The Issue

The central question was whether the property owner could directly challenge the validity of the tax ordinances in court, or whether she was required to first pursue the administrative remedies provided under the Local Government Code of 1991 (R.A. No. 7160).

The Ruling: Exhaustion of Administrative Remedies is Required

The Supreme Court held that the petition was premature. Under the Local Government Code, a taxpayer questioning the legality or constitutionality of a tax ordinance may appeal to the Secretary of Justice within thirty days from the ordinance's effectivity (Section 187). A property owner dissatisfied with an assessment may appeal to the Local Board of Assessment Appeals within sixty days from notice (Section 226). If the taxpayer questions the excessiveness of the tax, payment under protest is required before appeal (Section 252).

The Court noted that while cases raising purely legal questions are exempt from the exhaustion rule, Figuerres's case involved factual issues—such as whether public hearings were actually held—that required proof. The administrative remedies were therefore not a useless formality.

Public Hearings: Required, but Presumed Complied With

The Court agreed with Figuerres that Section 186 of R.A. No. 7160 requires prior public hearings before enacting ordinances levying taxes, fees, or charges. However, the Court applied the presumption of validity in favor of ordinances. Since Figuerres presented no evidence that no hearings were held, and the municipality claimed hearings were conducted, the Court upheld the ordinances.

The burden of proving a negative allegation—lack of public hearing—falls on the party asserting it. Bare assertions are insufficient to overcome the presumption that local officials complied with the law.

Publication and Posting Requirements

The Court clarified the publication rules under the Local Government Code:

• Schedule of fair market values must be published in a newspaper of general circulation, or posted in the provincial capitol, city or municipal hall, and two other conspicuous public places (Section 212).
• Tax ordinances must be published in full for three consecutive days in a newspaper of local circulation within ten days of approval, or posted in at least two conspicuous public places where no local newspaper exists (Section 188).
• Ordinances with penal sanctions must additionally be posted at prominent places for a minimum of three consecutive weeks and published in a newspaper of general circulation where available (Section 511[a]).

The Court held that these requirements apply cumulatively: the schedule of fair market values must be published under Section 212, and the ordinances themselves must be published or posted under Section 188. For ordinances with penal provisions, Section 511(a) also applies.

Again, the Court found that Figuerres failed to present evidence of non-compliance. The municipality submitted a certificate from its Sanggunian Secretary showing that Ordinance No. 125 had been posted, and the Court applied the presumption of regularity.

Practical Takeaways

• Exhaust administrative remedies first. A property owner challenging a real property tax ordinance must appeal to the Secretary of Justice (for legality or constitutionality), the Local Board of Assessment Appeals (for assessment issues), or pay under protest and appeal (for excessive taxes) before going to court.
• Public hearings are mandatory before enacting tax ordinances under Section 186 of the Local Government Code, but the burden of proving their absence falls on the challenger.
• Publication and posting rules are specific. Schedules of fair market values require publication or posting under Section 212; tax ordinances require publication for three consecutive days or posting under Section 188; and ordinances with penal sanctions have additional posting requirements under Section 511(a).
• The presumption of validity protects ordinances. Local governments benefit from a presumption that their ordinances were validly enacted. Challengers must present concrete evidence of procedural defects.
• Pure legal questions may be exempt from the exhaustion rule, but cases involving factual disputes—such as whether hearings were held—must first go through the administrative process.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.