The Supreme Court ruled that operating a cockpit without proper authorization does not create a legal right that can be protected by damages. This means that if a cockpit operator lacks the necessary license or authorization from the Sangguniang Bayan, they cannot claim damages for the suspension of their operations. The decision underscores the principle that a license to operate a cockpit is a mere privilege, not a right, and can be revoked when public interest requires. This ruling clarifies the extent of local government authority in regulating cockfighting activities and the limitations on operators’ claims for damages in the absence of a valid license.

When a Cockpit Operator’s Claim for Damages Gets Grounded: Examining Local Authority Over Licenses

The case of Danilo A. Du v. Venancio R. Jayoma, et al., G.R. No. 175042, decided on April 23, 2012, revolves around the legality of suspending a cockpit operation and the operator’s entitlement to damages. The petitioner, Danilo A. Du, sought to prevent the Municipal Mayor and members of the Sangguniang Bayan of Mabini, Bohol, from suspending his cockpit operation. He argued that Municipal Resolution No. 065, series of 1997, which ordered the suspension, was unlawful and deprived him of due process. The core legal question is whether Du had a legal right to operate the cockpit, entitling him to damages when the operation was suspended.

The factual backdrop reveals that the Municipality of Mabini required public bidding for cockpit operations every four years, as per Municipal Ordinance No. 1, series of 1988. While Engr. Edgardo Carabuena won the bidding for the period of 1989-1992, he failed to meet the legal requirements. As a result, Resolution No. 127, series of 1988, authorized Du to continue operating the cockpit until Carabuena complied. However, in 1997, the Sangguniang Bayan discovered that Du was operating the cockpit without proper authorization, leading to the issuance of Municipal Resolution No. 065, series of 1997, which suspended Du’s operations. The mayor then issued a letter ordering Du to cease his cockfighting activities immediately.

In response, Du filed a Petition for Prohibition with the Regional Trial Court (RTC), seeking to prevent the suspension and claiming damages. The RTC initially ruled in favor of Du, awarding him moral, actual, and exemplary damages, as well as attorney’s fees. However, the Court of Appeals (CA) reversed the RTC’s decision, holding that Du did not have a vested right to operate the cockpit and was therefore not entitled to damages. The Supreme Court then took up the case to determine whether the CA erred in denying Du’s claim for damages.

The Supreme Court anchored its decision on the fundamental principle that a cause of action requires the violation of a legal right. The Court emphasized that the essential elements of a cause of action are: “(1) a right in favor of the plaintiff; (2) an obligation on the part of the defendant to respect such right; and (3) an act or omission on the part of the defendant in violation of the plaintiff’s right with a resulting injury or damage to the plaintiff for which the latter may file an action for the recovery of damages or other appropriate relief.” Because Du had no such right, his claim necessarily failed.

In analyzing Du’s claim, the Court scrutinized the resolutions and ordinances governing the cockpit operations. It found that Resolution No. 127, series of 1988, only allowed Du to operate the cockpit temporarily, until the winning bidder complied with the legal requirements or until December 31, 1992, whichever came first. The Court noted that Du’s continued operation beyond this period was due to the Sangguniang Bayan’s failure to properly monitor the situation. Furthermore, the Court clarified that a business permit from the mayor did not equate to a license to operate a cockpit. According to Section 447(a)(3)(v) of the Local Government Code (LGC), the authority to license cockpit operations lies with the Sangguniang Bayan:

Section 447(a)(3)(v) of the LGC, it is the Sangguniang Bayan which is empowered to “authorize and license the establishment, operation and maintenance of cockpits, and regulate cockfighting and commercial breeding of gamecocks.”

The Court emphasized that since no public bidding was conducted from 1993 to 1997, Du could not claim authorization from the Sangguniang Bayan. Consequently, the Sangguniang Bayan had valid grounds to suspend Du’s operation through Municipal Resolution No. 065, series of 1997, and the mayor was obligated to enforce the suspension. The Court also presumed the validity of the resolution, stating that resolutions are “presumed valid in the absence of evidence showing that it is not in accordance with the law.”

Moreover, the Supreme Court reaffirmed the established principle that a license to operate a cockpit is a mere privilege, not a property right. Citing Pedro v. Provincial Board of Rizal, the Court stated, “a license authorizing the operation and exploitation of a cockpit is not property of which the holder may not be deprived without due process of law, but a mere privilege that may be revoked when public interests so require.” This distinction is crucial because it means that the government can revoke such licenses without necessarily violating due process rights. With this in mind, the Court dismissed Du’s claim that he was deprived of due process.

The Court concluded that because Du had no legal right to operate the cockpit, he was not entitled to damages. Injury alone is not sufficient to warrant damages; there must also be a violation of a legal right. As the Court articulated, “in order that the law will give redress for an act causing damage, there must be damnum et injuria – that act must be not only hurtful, but wrongful.” In Du’s case, while the suspension may have caused him financial injury, it was not a wrongful act because he lacked the legal right to operate the cockpit in the first place.

FAQs

What was the key issue in this case?	The central issue was whether Danilo A. Du had a legal right to operate a cockpit, entitling him to damages when his operations were suspended by local authorities. The Court determined that without proper authorization, he had no such right.
What is the significance of Municipal Resolution No. 065, series of 1997?	This resolution, passed by the Sangguniang Bayan of Mabini, Bohol, ordered the suspension of Du’s cockpit operations. It was significant because it triggered the legal dispute and highlighted the local government’s regulatory power over cockpits.
Why did the Court of Appeals reverse the RTC’s decision?	The CA reversed the RTC because it found that Du did not have a vested right to operate the cockpit. Since his operation was not properly authorized, he was not entitled to damages for its suspension.
What does Section 447(a)(3)(v) of the Local Government Code say?	This section empowers the Sangguniang Bayan to authorize and license the establishment, operation, and maintenance of cockpits. It also allows them to regulate cockfighting and the commercial breeding of gamecocks.
Is a license to operate a cockpit considered a property right?	No, the Supreme Court has consistently held that a license to operate a cockpit is a mere privilege, not a property right. This means it can be revoked when public interests require, without necessarily entitling the holder to compensation.
What is the meaning of damnum et injuria in this context?	Damnum et injuria means that for an act causing damage to be legally redressable, it must be both hurtful (damnum) and wrongful (injuria). In this case, while Du suffered financial damage, there was no legal wrong because he lacked the right to operate the cockpit.
What was the basis for Du’s initial operation of the cockpit?	Du initially operated the cockpit under Resolution No. 127, series of 1988. This resolution allowed him to continue operations temporarily because the winning bidder had not complied with the legal requirements.
How does this case affect future cockpit operations?	This case reinforces the importance of obtaining proper authorization from the Sangguniang Bayan before operating a cockpit. It clarifies that without such authorization, operators cannot claim damages for suspension of operations.

In conclusion, the Supreme Court’s decision in Du v. Jayoma underscores the critical distinction between a legal right and a mere privilege in the context of business operations. Local government units have the authority to regulate and license activities like cockfighting, and operators must adhere strictly to these regulations to protect their interests. Without a valid license, operators cannot claim damages for the suspension of their operations, highlighting the importance of legal compliance.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: DANILO A. DU, VS. VENANCIO R. JAYOMA, G.R. No. 175042, April 23, 2012