Acebedo Optical Company, Inc.

vs Court of Appeals
FACTS:
Acebedo Optical Company, Inc. applied for a business permit to operate in Iligan City. After hearing the
sides of local optometrists, Mayor Camilo Cabili of Iligan granted the permit but he attached various special
conditions which basically made Acebedo dependent upon prescriptions or limitations to be issued by local
optometrists. Acebedo basically is not allowed to practice optometry within the city (but may sell glasses only).
Acebedo however acquiesced (accept silently) to the said conditions and operated under the permit.
Later, Acebedo was charged for violating the said conditions and was subsequently suspended from
operating within Iligan. Acebedo then assailed the validity of the attached conditions. The local optometrists
argued that Acebedo is estopped in assailing the said conditions because it acquiesced to the same and that the
imposition of the special conditions is a valid exercise of police power; that such conditions were entered upon
by the city in its proprietary function hence the permit is actually a contract.
ISSUE:
Whether or not the special conditions attached by the mayor is a valid exercise of police power.

HELD:
NO. Acebedo was applying for a business permit to operate its business and not to practice optometry
(the latter being within the jurisdiction PRC Board of Optometry). The conditions attached by the mayor is
ultra vires (beyond one's legal power or authority) hence cannot be given any legal application therefore
estoppel does not apply.
In law, estoppel is a set of doctrines in which a court prevents a litigant
from taking an action the litigant normally would have the right to take, in order
to prevent an inequitable result.
It is neither a valid exercise of police power. Though the mayor can definitely impose conditions in the
granting of permits, he must base such conditions on law or ordinances otherwise the conditions are ultra
vires.
Lastly, the granting of the license is not a contract, it is a special privilege estoppel does not apply.

FACTS:
Petitioner applied with the Office of the City Mayor of Iligan for a business permit. Permit was therefor issued,
subject to certain conditions like prohibition of putting up an optical clinic, examining and/or prescribing
reading and similar optical glasses, etc. When it was found that petitioner violated these conditions, its
business permit was cancelled.
ISSUE:
Whether or not the imposition of special conditions by the public respondents were acts ultra vires
RULING:
Police Power exercised by LGUs
Police power as an inherent attribute of sovereignty is the power to prescribe regulations to promote the health,
morals, peace, education, good order or safety and general welfare of the people. The State, through the
legislature, has delegated the exercise of police power to local government units, as agencies of the State, in
order to effectively accomplish and carry out the declared objects of their creation. This delegation of police
power is embodied in the general welfare clause of the Local Government Code xxx
The scope of police power has been held to be so comprehensive as to encompass almost all matters affecting
the health, safety, peace, order, morals, comfort and convenience of the community. Police power is essentially
regulatory in nature and the power to issue licenses or grant business permits, if exercised for a regulatory and
not revenue-raising purpose, is within the ambit of this power.
Power of city mayor to grant business permits
The authority of city mayors to issue or grant licenses and business permits is beyond cavil. It is provided for by
law.
However, the power to grant or issue licenses or business permits must always be exercised in accordance with
law, with utmost observance of the rights of all concerned to due process and equal protection of the law.
But can city mayor cancel business permits or impose special conditions? As aptly discussed by the Solicitor
General in his Comment, the power to issue licenses and permits necessarily includes the corollary power to
revoke, withdraw or cancel the same. And the power to revoke or cancel, likewise includes the power to restrict
through the imposition of certain conditions.
Did the conditions or restrictions imposed amount to a confiscation of the business?
Distinction must be made between the grant of a license or permit to do business and the issuance of a license
to engage in the practice of a particular profession. The first is usually granted by the local authorities and the
second is issued by the Board or Commission tasked to regulate the particular profession. A business permit
authorizes the person, natural or otherwise, to engage in business or some form of commercial activity. A
professional license, on the other hand, is the grant of authority to a natural person to engage in the practice or
exercise of his or her profession.
In the case at bar, what is sought by petitioner from respondent City Mayor is a permit to engage in the
business of running an optical shop. It does not purport to seek a license to engage in the practice of optometry
as a corporate body or entity, although it does have in its employ, persons who are duly licensed to practice
optometry by the Board of Examiners in Optometry.