‘Title: Film Development Couneil of the Philippines v. SM Prime Holdings, Ine. GR No. 197937 Date: Api 3, 2013, Ponente: Viliarama, J. Parties: Poltionar: Film Development Couneil ofthe Phifppines respondent: SM Prime Holdings Facts: Respondent SM Prime HOLDINGS, Inc. isthe owner and operator of cinema houses at SM Cebu in Cebu City. The Local Government Code (LGC) of 1991 provides that owners, propriators end lessees of theaters and cineme houses are subject to amusement tax (not more then 20% ofthe gross receipts rom admission fees) 2s provided in Section 140, Book Il Title One, R.A. No, 0167 created The Film Development Council of the Philippines, harain petitioner, has a mandate which indudas the ‘development and implementation of “an incentive and reward system forthe prosucers based on merit to encourage the production ‘of quality fms." Thus, the Cinema Evaluation Board (CEB) was established. its main function beng toreview and grade films. ‘According to Section 13 of R.A. No 0167, the producers ofthe fils graced “AT or ‘B” chal be eniled to an incentive equivalent to ‘he amusement tax impose¢ and collected by highly urbanizes ang incepencent component cies inthe Philppines pursuant to Section 140 and 151 of the LGC. 100% of the amusement tax for fms grades “A” and 85% for films graded "B" (he remaining 35% ‘shall accrue tothe funds ofthe Counai). On the other hand Section 14 of the same law mandates the remittance af the proceeds of the tax collectes by he LGUS to pettioner. January 27, 2009, poitioner through the OSG sent s damand letter to respondent forthe payment of amusement tax rowards dus to producers of 89 films graded "A" and” which were shown at SM cinemas from September 11, 20003 to Novernber 4, 2006 ‘The city of Cebu pettioned in the Cebu RTC against the petitioner as itsought to seek invaid and unconstituional Section 14 of R.A No. 9167 an grounds that: (1)it violates the basic policy on focal autonomy; (2) itconstitutes an undue imitaion of the taxing ower ofthe LGUs; 3) unduly deprives LGUS of te revenue from the amusement tax imposed on thealre owners and operators ‘and (it amounts to technical malversation since revenue fram the collzction of amusement taxes thal would ctherwise accrue to _and form part ofthe general fund of the LGU concerned woukd now be dreclly awarded to a private enity—ihe producers of the ‘ilms-bypassing the budget process of the LGU and without the proper approoriation ordinance from the sanggunian. Several more petitions were raised in court yielding conflicting decisions, The las ofthese was about the petitioner ing a comment praying forthe cismissal ofthe case fled by the Cy of Cebu while respondent fled a Motion to Dismiss arguing thet petitioners ‘compiaint merits cutrght dismissal considering that its claim had already bean extinguished by respondents prior payment or remittance of the subject amusement taxes to the City of Cebu. Ieeuo: WON Section 13 and 14 of RA. No. 9167 is unconstitutional as it conflicts wih the provisions of the LC - was left to be resolved at the lower court Ratio: ‘This case had failed in ite procedural aspect. Tho court held thal there are igeues involving inispendontia which fist hac 1 be resolved before the constitutionaity issues may be raised, Since there were so many cases fled al he same ime regarding this ‘subject, the Court looked on to the technicalities of procedure. ‘The ponencia states “tis evident that petiioner’s claim against the respondent hinges on the correet interpretation ofthe contiting provisions of the LGC of 1991 and RA No. 9107. There could be no doubt tat a judgment in ether case would constitute res jucicaa tothe other.” The Court also used the ctiteron of the consideration ofthe interest of justice enunciated in Ra v. Magsaysay in considering the predicament of he cespondent In applying ths siandard, what was asked was which court would be"in 2 beter positon lo Serve the interests of justice,” taking into account (a) the nature ofthe controversy, (0) the comparative accessibility ofthe courtto the panies ana (e) ther similar factors, ‘Therefore, considering all the factors inthis case, there can be no doubt Civil Case in Cebu is the appropriate vehicie to determine the nights of peitioner and recpondent. WHEREFORE. pation DENIED.