Phil Match Co., Ltd., vs City of Cebu

PHIL. MATCH CO., LTD., vs. CITY OF CEBU & JESUS ZABATE (Acting City Treasurer)
G.R. No. L-30745 January 18, 1978
Appeal from a judgment of the CFI of Cebu
Aquino, J.:
Facts: Petitioner, engaged in manufacturing of matches, assails the legality of the tax which the city treasure collected on out-of-town deliveries of matches by virtue of the city ordinance which taxes good stored and/or sold within the city. The company sought refund of the sales tax and for damages against the city treasurer fo r not following the advise of the city fiscal, as legal adviser of the city, that all out-of-town deliveries of matches are not subject to sales tax. The trial court dismissed the complaint against the city treasurer.

Issue: WON the city treasurer can be held liable for damages under art. 27 of the CC

Ruling: Judgment AFFIRMED.
Article 27 of the Civil Code provides that "any person suffering material or moral lose because a public servant or employee refuses or neglects, without just cause, to perform his official duty may file an action for damages and other relief against the latter, without prejudice to any disciplinary administrative action that may be taken." Article 27 presupposes that the refuse or omission of a public official is attributable to malice or inexcusable negligence. In the case at bar, the records clearly show that the city treasurer honestly believed that he was justified under the ordinance to collect taxes. The fiscal’s opinion on the legality of such or any other ordinance is merely advisory and has no binding effects.
As a rule, Where an officer is invested with discretion in matters brought before him and when so acting he is usually given immunity from liability to persons who may be injured as the result or an erroneous or mistaken decision, provided the acts complained of are done within the scope of the officer's authority and without malice, or corruption. It has been held previously by the SC that an erroneous interpretation of an ordinance does not constitute nor does it amount to bad faith that would entitle an aggrieved party to an award for damages Cabungcal vs. Cordovan 120 Phil. 667).
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