Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No.

L-17587 September 12, 1967

PHILIPPINE BANKING CORPORATION, representing the estate of JUSTINA SANTOS Y CANON FAUSTINO, deceased, plaintiff-appellant, vs. LUI SHE in her own behalf and as administratrix of the intestate estate of Wong Heng, deceased,defendantappellant. Nicanor S. Sison for plaintiff-appellant. Ozaeta, Gibbs & Ozaeta for defendant-appellant.

CASTRO, J.: Justina Santos y Canon Faustino and her sister Lorenzo were the owners in common of a piece of land in Manila. This parcel, with an area of 2,582.30 square meters, is located on Rizal Avenue and opens into Florentino Torres street at the back and Katubusan street on one side. In it are two residential houses with entrance on Florentino Torres street and the Hen Wah Restaurant with entrance on Rizal Avenue. The sisters lived in one of the houses, while Wong Heng, a Chinese, lived with his family in the restaurant. Wong had been a long-time lessee of a portion of the property, paying a monthly rental of P2,620. On September 22, 1957 Justina Santos became the owner of the entire property as her sister died with no other heir. Then already well advanced in years, being at the time 90 years old, blind, crippled and an invalid, she was left with no other relative to live with. Her only companions in the house were her 17 dogs and 8 maids. Her otherwise dreary existence was brightened now and then by the visits of Wong's four children who had become the joy of her life. Wong himself was the trusted man to whom she delivered various amounts for safekeeping, including rentals from her property at the corner of Ongpin and Salazar streets and the rentals which Wong himself paid as lessee of a part of the Rizal Avenue property. Wong also took care of the payment; in her behalf, of taxes, lawyers' fees, funeral expenses, masses, salaries of maids and security guard, and her household expenses. "In grateful acknowledgment of the personal services of the lessee to her," Justina Santos executed on November 15, 1957 a contract of lease (Plff Exh. 3) in favor of Wong, covering the portion then already leased to him and another portion fronting Florentino Torres street. The lease was for 50 years, although the lessee was given the right to withdraw at any time from the agreement; the monthly rental was P3,120. The contract covered an area of 1,124 square meters. Ten days later (November 25), the contract was amended (Plff Exh. 4) so as to make it cover the entire property, including the portion on which the house of Justina Santos stood, at an additional monthly rental of P360. For his part Wong undertook to pay, out of the rental due from him, an amount not exceeding P1,000 a month for the food of her dogs and the salaries of her maids. On December 21 she executed another contract (Plff Exh. 7) giving Wong the option to buy the leased premises for P120,000, payable within ten years at a monthly installment of P1,000. The option, written in Tagalog, imposed on him the obligation to pay for the food of the dogs and the salaries of the maids in her household, the charge not to exceed P1,800 a month. The option was conditioned on his obtaining Philippine citizenship, a petition for which was then pending in the Court of First Instance of Rizal. It appears, however, that this application for naturalization was withdrawn when it was discovered that he was not a resident of Rizal. On October 28, 1958 she filed a petition to adopt him and his children on the erroneous belief that adoption would confer on them Philippine citizenship. The error was discovered and the proceedings were abandoned. On November 18, 1958 she executed two other contracts, one (Plff Exh. 5) extending the term of the lease to 99 years, and another (Plff Exh. 6) fixing the term of the option of 50 years. Both contracts are written in Tagalog.

In two wills executed on August 24 and 29, 1959 (Def Exhs. 285 & 279), she bade her legatees to respect the contracts she had entered into with Wong, but in a codicil (Plff Exh. 17) of a later date (November 4, 1959) she appears to have a change of heart. Claiming that the various contracts were made by her because of machinations and inducements practiced by him, she now directed her executor to secure the annulment of the contracts. On November 18 the present action was filed in the Court of First Instance of Manila. The complaint alleged that the contracts were obtained by Wong "through fraud, misrepresentation, inequitable conduct, undue influence and abuse of confidence and trust of and (by) taking advantage of the helplessness of the plaintiff and were made to circumvent the constitutional provision prohibiting aliens from acquiring lands in the Philippines and also of the Philippine Naturalization Laws." The court was asked to direct the Register of Deeds of Manila to cancel the registration of the contracts and to order Wong to pay Justina Santos the additional rent of P3,120 a month from November 15, 1957 on the allegation that the reasonable rental of the leased premises was P6,240 a month. In his answer, Wong admitted that he enjoyed her trust and confidence as proof of which he volunteered the information that, in addition to the sum of P3,000 which he said she had delivered to him for safekeeping, another sum of P22,000 had been deposited in a joint account which he had with one of her maids. But he denied having taken advantage of her trust in order to secure the execution of the contracts in question. As counterclaim he sought the recovery of P9,210.49 which he said she owed him for advances. Wong's admission of the receipt of P22,000 and P3,000 was the cue for the filing of an amended complaint. Thus on June 9, 1960, aside from the nullity of the contracts, the collection of various amounts allegedly delivered on different occasions was sought. These amounts and the dates of their delivery are P33,724.27 (Nov. 4, 1957); P7,344.42 (Dec. 1, 1957); P10,000 (Dec. 6, 1957); P22,000 and P3,000 (as admitted in his answer). An accounting of the rentals from the Ongpin and Rizal Avenue properties was also demanded. In the meantime as a result of a petition for guardianship filed in the Juvenile and Domestic Relations Court, the Security Bank & Trust Co. was appointed guardian of the properties of Justina Santos, while Ephraim G. Gochangco was appointed guardian of her person. In his answer, Wong insisted that the various contracts were freely and voluntarily entered into by the parties. He likewise disclaimed knowledge of the sum of P33,724.27, admitted receipt of P7,344.42 and P10,000, but contended that these amounts had been spent in accordance with the instructions of Justina Santos; he expressed readiness to comply with any order that the court might make with respect to the sums of P22,000 in the bank and P3,000 in his possession. The case was heard, after which the lower court rendered judgment as follows: [A]ll the documents mentioned in the first cause of action, with the exception of the first which is the lease contract of 15 November 1957, are declared null and void; Wong Heng is condemned to pay unto plaintiff thru guardian of her property the sum of P55,554.25 with legal interest from the date of the filing of the amended complaint; he is also ordered to pay the sum of P3,120.00 for every month of his occupation as lessee under the document of lease herein sustained, from 15 November 1959, and the moneys he has consigned since then shall be imputed to that; costs against Wong Heng. From this judgment both parties appealed directly to this Court. After the case was submitted for decision, both parties died, Wong Heng on October 21, 1962 and Justina Santos on December 28, 1964. Wong was substituted by his wife, Lui She, the other defendant in this case, while Justina Santos was substituted by the Philippine Banking Corporation. Justina Santos maintained now reiterated by the Philippine Banking Corporation that the lease contract (Plff Exh. 3) should have been annulled along with the four other contracts (Plff Exhs. 4-7) because it lacks mutuality; because it included a portion which, at the time, was in custodia legis; because the contract was obtained in violation of the fiduciary relations of the parties; because her consent was obtained through undue influence, fraud and misrepresentation; and because the lease contract, like the rest of the contracts, is absolutely simulated. Paragraph 5 of the lease contract states that "The lessee may at any time withdraw from this agreement." It is claimed that this stipulation offends article 1308 of the Civil Code which provides that "the contract must bind both contracting parties; its validity or compliance cannot be left to the will of one of them."

We have had occasion to delineate the scope and application of article 1308 in the early case of Taylor v. Uy Tieng Piao.1 We said in that case: Article 1256 [now art. 1308] of the Civil Code in our opinion creates no impediment to the insertion in a contract for personal service of a resolutory condition permitting the cancellation of the contract by one of the parties. Such a stipulation, as can be readily seen, does not make either the validity or the fulfillment of the contract dependent upon the will of the party to whom is conceded the privilege of cancellation; for where the contracting parties have agreed that such option shall exist, the exercise of the option is as much in the fulfillment of the contract as any other act which may have been the subject of agreement. Indeed, the cancellation of a contract in accordance with conditions agreed upon beforehand is fulfillment.2 And so it was held in Melencio v. Dy Tiao Lay 3 that a "provision in a lease contract that the lessee, at any time before he erected any building on the land, might rescind the lease, can hardly be regarded as a violation of article 1256 [now art. 1308] of the Civil Code." The case of Singson Encarnacion v. Baldomar 4 cannot be cited in support of the claim of want of mutuality, because of a difference in factual setting. In that case, the lessees argued that they could occupy the premises as long as they paid the rent. This is of course untenable, for as this Court said, "If this defense were to be allowed, so long as defendants elected to continue the lease by continuing the payment of the rentals, the owner would never be able to discontinue it; conversely, although the owner should desire the lease to continue the lessees could effectively thwart his purpose if they should prefer to terminate the contract by the simple expedient of stopping payment of the rentals." Here, in contrast, the right of the lessee to continue the lease or to terminate it is so circumscribed by the term of the contract that it cannot be said that the continuance of the lease depends upon his will. At any rate, even if no term had been fixed in the agreement, this case would at most justify the fixing of a period5 but not the annulment of the contract. Nor is there merit in the claim that as the portion of the property formerly owned by the sister of Justina Santos was still in the process of settlement in the probate court at the time it was leased, the lease is invalid as to such portion. Justina Santos became the owner of the entire property upon the death of her sister Lorenzo on September 22, 1957 by force of article 777 of the Civil Code. Hence, when she leased the property on November 15, she did so already as owner thereof. As this Court explained in upholding the sale made by an heir of a property under judicial administration: That the land could not ordinarily be levied upon while in custodia legis does not mean that one of the heirs may not sell the right, interest or participation which he has or might have in the lands under administration. The ordinary execution of property in custodia legis is prohibited in order to avoid interference with the possession by the court. But the sale made by an heir of his share in an inheritance, subject to the result of the pending administration, in no wise stands in the way of such administration.6 It is next contended that the lease contract was obtained by Wong in violation of his fiduciary relationship with Justina Santos, contrary to article 1646, in relation to article 1941 of the Civil Code, which disqualifies "agents (from leasing) the property whose administration or sale may have been entrusted to them." But Wong was never an agent of Justina Santos. The relationship of the parties, although admittedly close and confidential, did not amount to an agency so as to bring the case within the prohibition of the law. Just the same, it is argued that Wong so completely dominated her life and affairs that the contracts express not her will but only his. Counsel for Justina Santos cites the testimony of Atty. Tomas S. Yumol who said that he prepared the lease contract on the basis of data given to him by Wong and that she told him that "whatever Mr. Wong wants must be followed."7 The testimony of Atty. Yumol cannot be read out of context in order to warrant a finding that Wong practically dictated the terms of the contract. What this witness said was: Q Did you explain carefully to your client, Doa Justina, the contents of this document before she signed it? A I explained to her each and every one of these conditions and I also told her these conditions were quite onerous for her, I don't really know if I have expressed my opinion, but I told her that we would rather not execute any contract anymore, but to hold it as it was before, on a verbal month to month contract of lease.

Q But, she did not follow your advice, and she went with the contract just the same? A She agreed first . . . Q Agreed what? A Agreed with my objectives that it is really onerous and that I was really right, but after that, I was called again by her and she told me to follow the wishes of Mr. Wong Heng. xxx xxx xxx

Q So, as far as consent is concerned, you were satisfied that this document was perfectly proper? xxx xxx xxx

A Your Honor, if I have to express my personal opinion, I would say she is not, because, as I said before, she told me "Whatever Mr. Wong wants must be followed."8 Wong might indeed have supplied the data which Atty. Yumol embodied in the lease contract, but to say this is not to detract from the binding force of the contract. For the contract was fully explained to Justina Santos by her own lawyer. One incident, related by the same witness, makes clear that she voluntarily consented to the lease contract. This witness said that the original term fixed for the lease was 99 years but that as he doubted the validity of a lease to an alien for that length of time, he tried to persuade her to enter instead into a lease on a month-tomonth basis. She was, however, firm and unyielding. Instead of heeding the advice of the lawyer, she ordered him, "Just follow Mr. Wong Heng."9 Recounting the incident, Atty. Yumol declared on cross examination: Considering her age, ninety (90) years old at the time and her condition, she is a wealthy woman, it is just natural when she said "This is what I want and this will be done." In particular reference to this contract of lease, when I said "This is not proper," she said "You just go ahead, you prepare that, I am the owner, and if there is any illegality, I am the only one that can question the illegality."10 Atty. Yumol further testified that she signed the lease contract in the presence of her close friend, Hermenegilda Lao, and her maid, Natividad Luna, who was constantly by her side.11 Any of them could have testified on the undue influence that Wong supposedly wielded over Justina Santos, but neither of them was presented as a witness. The truth is that even after giving his client time to think the matter over, the lawyer could not make her change her mind. This persuaded the lower court to uphold the validity of the lease contract against the claim that it was procured through undue influence. Indeed, the charge of undue influence in this case rests on a mere inference12 drawn from the fact that Justina Santos could not read (as she was blind) and did not understand the English language in which the contract is written, but that inference has been overcome by her own evidence. Nor is there merit in the claim that her consent to the lease contract, as well as to the rest of the contracts in question, was given out of a mistaken sense of gratitude to Wong who, she was made to believe, had saved her and her sister from a fire that destroyed their house during the liberation of Manila. For while a witness claimed that the sisters were saved by other persons (the brothers Edilberto and Mariano Sta. Ana)13 it was Justina Santos herself who, according to her own witness, Benjamin C. Alonzo, said "very emphatically" that she and her sister would have perished in the fire had it not been for Wong.14 Hence the recital in the deed of conditional option (Plff Exh. 7) that "[I]tong si Wong Heng ang siyang nagligtas sa aming dalawang magkapatid sa halos ay tiyak na kamatayan", and the equally emphatic avowal of gratitude in the lease contract (Plff Exh. 3). As it was with the lease contract (Plff Exh. 3), so it was with the rest of the contracts (Plff Exhs. 4-7) the consent of Justina Santos was given freely and voluntarily. As Atty. Alonzo, testifying for her, said: [I]n nearly all documents, it was either Mr. Wong Heng or Judge Torres and/or both. When we had conferences, they used to tell me what the documents should contain. But, as I said, I would always ask the old woman about them and invariably the old woman used to tell me: "That's okay. It's all right."15

But the lower court set aside all the contracts, with the exception of the lease contract of November 15, 1957, on the ground that they are contrary to the expressed wish of Justina Santos and that their considerations are fictitious. Wong stated in his deposition that he did not pay P360 a month for the additional premises leased to him, because she did not want him to, but the trial court did not believe him. Neither did it believe his statement that he paid P1,000 as consideration for each of the contracts (namely, the option to buy the leased premises, the extension of the lease to 99 years, and the fixing of the term of the option at 50 years), but that the amount was returned to him by her for safekeeping. Instead, the court relied on the testimony of Atty. Alonzo in reaching the conclusion that the contracts are void for want of consideration. Atty. Alonzo declared that he saw no money paid at the time of the execution of the documents, but his negative testimony does not rule out the possibility that the considerations were paid at some other time as the contracts in fact recite. What is more, the consideration need not pass from one party to the other at the time a contract is executed because the promise of one is the consideration for the other.16 With respect to the lower court's finding that in all probability Justina Santos could not have intended to part with her property while she was alive nor even to lease it in its entirety as her house was built on it, suffice it to quote the testimony of her own witness and lawyer who prepared the contracts (Plff Exhs. 4-7) in question, Atty. Alonzo: The ambition of the old woman, before her death, according to her revelation to me, was to see to it that these properties be enjoyed, even to own them, by Wong Heng because Doa Justina told me that she did not have any relatives, near or far, and she considered Wong Heng as a son and his children her grandchildren; especially her consolation in life was when she would hear the children reciting prayers in Tagalog.17 She was very emphatic in the care of the seventeen (17) dogs and of the maids who helped her much, and she told me to see to it that no one could disturb Wong Heng from those properties. That is why we thought of the ninety-nine (99) years lease; we thought of adoption, believing that thru adoption Wong Heng might acquire Filipino citizenship; being the adopted child of a Filipino citizen.18 This is not to say, however, that the contracts (Plff Exhs. 3-7) are valid. For the testimony just quoted, while dispelling doubt as to the intention of Justina Santos, at the same time gives the clue to what we view as a scheme to circumvent the Constitutional prohibition against the transfer of lands to aliens. "The illicit purpose then becomes the illegal causa"19 rendering the contracts void. Taken singly, the contracts show nothing that is necessarily illegal, but considered collectively, they reveal an insidious pattern to subvert by indirection what the Constitution directly prohibits. To be sure, a lease to an alien for a reasonable period is valid. So is an option giving an alien the right to buy real property on condition that he is granted Philippine citizenship. As this Court said in Krivenko v. Register of Deeds:20 [A]liens are not completely excluded by the Constitution from the use of lands for residential purposes. Since their residence in the Philippines is temporary, they may be granted temporary rights such as a lease contract which is not forbidden by the Constitution. Should they desire to remain here forever and share our fortunes and misfortunes, Filipino citizenship is not impossible to acquire. But if an alien is given not only a lease of, but also an option to buy, a piece of land, by virtue of which the Filipino owner cannot sell or otherwise dispose of his property,21 this to last for 50 years, then it becomes clear that the arrangement is a virtual transfer of ownership whereby the owner divests himself in stages not only of the right to enjoy the land ( jus possidendi, jus utendi, jus fruendi and jus abutendi) but also of the right to dispose of it ( jus disponendi) rights the sum total of which make up ownership. It is just as if today the possession is transferred, tomorrow, the use, the next day, the disposition, and so on, until ultimately all the rights of which ownership is made up are consolidated in an alien. And yet this is just exactly what the parties in this case did within the space of one year, with the result that Justina Santos' ownership of her property was reduced to a hollow concept. If this can be done, then the Constitutional ban against alien landholding in the Philippines, as announced in Krivenko v. Register of Deeds,22 is indeed in grave peril. It does not follow from what has been said, however, that because the parties are in pari delicto they will be left where they are, without relief. For one thing, the original parties who were guilty of a violation of the fundamental charter have died and have since been substituted by their administrators to whom it would be unjust to impute their

guilt.23 For another thing, and this is not only cogent but also important, article 1416 of the Civil Code provides, as an exception to the rule on pari delicto, that "When the agreement is not illegal per se but is merely prohibited, and the prohibition by law is designed for the protection of the plaintiff, he may, if public policy is thereby enhanced, recover what he has paid or delivered." The Constitutional provision that "Save in cases of hereditary succession, no private agricultural land shall be transferred or assigned except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain in the Philippines"24 is an expression of public policy to conserve lands for the Filipinos. As this Court said in Krivenko: It is well to note at this juncture that in the present case we have no choice. We are construing the Constitution as it is and not as we may desire it to be. Perhaps the effect of our construction is to preclude aliens admitted freely into the Philippines from owning sites where they may build their homes. But if this is the solemn mandate of the Constitution, we will not attempt to compromise it even in the name of amity or equity . . . . For all the foregoing, we hold that under the Constitution aliens may not acquire private or public agricultural lands, including residential lands, and, accordingly, judgment is affirmed, without costs.25 That policy would be defeated and its continued violation sanctioned if, instead of setting the contracts aside and ordering the restoration of the land to the estate of the deceased Justina Santos, this Court should apply the general rule of pari delicto. To the extent that our ruling in this case conflicts with that laid down inRellosa v. Gaw Chee Hun 26 and subsequent similar cases, the latter must be considered as pro tanto qualified. The claim for increased rentals and attorney's fees, made in behalf of Justina Santos, must be denied for lack of merit. And what of the various amounts which Wong received in trust from her? It appears that he kept two classes of accounts, one pertaining to amount which she entrusted to him from time to time, and another pertaining to rentals from the Ongpin property and from the Rizal Avenue property, which he himself was leasing. With respect to the first account, the evidence shows that he received P33,724.27 on November 8, 1957 (Plff Exh. 16); P7,354.42 on December 1, 1957 (Plff Exh. 13); P10,000 on December 6, 1957 (Plff Exh. 14) ; and P18,928.50 on August 26, 1959 (Def. Exh. 246), or a total of P70,007.19. He claims, however, that he settled his accounts and that the last amount of P18,928.50 was in fact payment to him of what in the liquidation was found to be due to him. He made disbursements from this account to discharge Justina Santos' obligations for taxes, attorneys' fees, funeral services and security guard services, but the checks (Def Exhs. 247-278) drawn by him for this purpose amount to only P38,442.84.27 Besides, if he had really settled his accounts with her on August 26, 1959, we cannot understand why he still had P22,000 in the bank and P3,000 in his possession, or a total of P25,000. In his answer, he offered to pay this amount if the court so directed him. On these two grounds, therefore, his claim of liquidation and settlement of accounts must be rejected. After subtracting P38,442.84 (expenditures) from P70,007.19 (receipts), there is a difference of P31,564 which, added to the amount of P25,000, leaves a balance of P56,564.3528 in favor of Justina Santos. As to the second account, the evidence shows that the monthly income from the Ongpin property until its sale in Rizal Avenue July, 1959 was P1,000, and that from the Rizal Avenue property, of which Wong was the lessee, was P3,120. Against this account the household expenses and disbursements for the care of the 17 dogs and the salaries of the 8 maids of Justina Santos were charged. This account is contained in a notebook (Def. Exh. 6) which shows a balance of P9,210.49 in favor of Wong. But it is claimed that the rental from both the Ongpin and Rizal Avenue properties was more than enough to pay for her monthly expenses and that, as a matter of fact, there should be a balance in her favor. The lower court did not allow either party to recover against the other. Said the court: [T]he documents bear the earmarks of genuineness; the trouble is that they were made only by Francisco Wong and Antonia Matias, nick-named Toning, which was the way she signed the loose sheets, and there is no clear proof that Doa Justina had authorized these two to act for her in such liquidation; on the contrary if the result of that was a deficit as alleged and sought to be there shown, of

P9,210.49, that was not what Doa Justina apparently understood for as the Court understands her statement to the Honorable Judge of the Juvenile Court . . . the reason why she preferred to stay in her home was because there she did not incur in any debts . . . this being the case, . . . the Court will not adjudicate in favor of Wong Heng on his counterclaim; on the other hand, while it is claimed that the expenses were much less than the rentals and there in fact should be a superavit, . . . this Court must concede that daily expenses are not easy to compute, for this reason, the Court faced with the choice of the two alternatives will choose the middle course which after all is permitted by the rules of proof, Sec. 69, Rule 123 for in the ordinary course of things, a person will live within his income so that the conclusion of the Court will be that there is neither deficit nor superavit and will let the matter rest here. Both parties on appeal reiterate their respective claims but we agree with the lower court that both claims should be denied. Aside from the reasons given by the court, we think that the claim of Justina Santos totalling P37,235, as rentals due to her after deducting various expenses, should be rejected as the evidence is none too clear about the amounts spent by Wong for food29 masses30 and salaries of her maids.31 His claim for P9,210.49 must likewise be rejected as his averment of liquidation is belied by his own admission that even as late as 1960 he still had P22,000 in the bank and P3,000 in his possession. ACCORDINGLY, the contracts in question (Plff Exhs. 3-7) are annulled and set aside; the land subject-matter of the contracts is ordered returned to the estate of Justina Santos as represented by the Philippine Banking Corporation; Wong Heng (as substituted by the defendant-appellant Lui She) is ordered to pay the Philippine Banking Corporation the sum of P56,564.35, with legal interest from the date of the filing of the amended complaint; and the amounts consigned in court by Wong Heng shall be applied to the payment of rental from November 15, 1959 until the premises shall have been vacated by his heirs. Costs against the defendant-appellant. Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Bengzon, J.P., Zaldivar, Sanchez and Angeles, JJ., concur.

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION

G.R. Nos. 113472-73 December 20, 1994 ONG CHING PO, YU SIOK LIAN DAVID ONG and JIMMY ONG, petitioners, vs. COURT OF APPEALS and SOLEDAD PARIAN, respondents. Bautista, Salva, Arrieta, Salva for petitioner. Arthem Maceda Potian for private respondent.

QUIASON, J.: This is a petition for review on certiorari under Rule 45 of the Revised Rules of Court of the Decision of the Court of Appeals dated July 15, 1993, which dismissed the petition for certiorari in CA-G.R. CV Nos. 28391-92. I On July 23, 1947, Ong Joi Jong sold a parcel of land located at Fundidor Street, San Nicolas to private respondent Soledad Parian, the wife of Ong Yee. The latter, the brother of petitioner Ong Ching Po, died in January 1983; while

petitioner Ong Ching Po died in October 1986. The said sale was evidenced by a notarized Deed of Sale written in English. Subsequently, the document was registered with the Register of Deeds of Manila, which issued Transfer Certificate of Title No. 9260 dated September 2, 1947 in the name of private respondent. According to private respondent, she entrusted the administration of the lot and building to petitioner Ong Ching Po when she and her husband settled in Iloilo. When her husband died, she demanded that the lot be vacated because she was going to sell it. Unfortunately, petitioners refused to vacate the said premises. On March 19, 1984, private respondent filed a case for unlawful detainer against petitioner Ong Ching Po before the Metropolitan Trial Court of Manila, Branch 26. The inferior court dismissed her case. The dismissal was affirmed by the Regional Trial Court, Branch 10, Manila. The decision of the Regional Trial Court was, in turn, affirmed by the Court of Appeals, which dismissed the petition. The decision of the Court of Appeals became final and executory. Petitioners, on the other hand, claimed that on July 23, 1946, petitioner Ong Ching Po bought the said parcel of land from Ong Joi Jong. The sale was evidenced by a photo copy of a Deed of Sale written in Chinese with the letter head "Sincere Trading Co." (Exh. "B"). An English translation of said document (Exh. "C") read as follows: Deed of Sale I, Ong Joi Jong, a party to this Deed of Sale hereby sell in absolutely (sic) manner a lot located on No. 4 Fundidor Street, San Nicolas an (sic) area consisting 213 square meters including a one-story house erected thereon unto Mr. Ong Ching Po for the sum of P6,000.00 the receipt of which is hereby acknowledged by me and consequently I have executed and signed the government registered title (sic) the said lot inclusive of the house erected thereon, now belong (sic) to Mr. Ong Ching Po unequivocally. And the purpose of this document is to precisely serve as proof of the sale. Addendum: I have acceded to the request of Mr. Ong Ching Po into signing another document in favor of Soledad Parian (She is the Filipino wife of Ong Yee, brother of Ong Ching Po) for the purpose of facilitating the issuance of the new title by the City Register of Deeds and for the reason that he is not yet a Filipino. I certify to the truthfulness of this fact. Lot Seller: Ong Joi Jong (Exhibits for the plaintiff, p. 4) On December 6, 1983, petitioner Ong Ching Po executed a Deed of Absolute Sale conveying to his children, petitioners Jimmy and David Ong, the same property sold by Ong Joi Jong to private respondent in 1947. On December 12 1985, petitioners Ong Ching Po, Jimmy Ong and David Ong filed an action for reconveyance and damages against private respondent in the Regional Trial Court, Branch 53, Manila, docketed as Case No. 8533962. On July 26, 1986, private respondent filed an action for quieting of title against petitioners Ong Ching Po and his wife, petitioner Yu Siok Lian, in the Regional Trial Court, Branch 58, Manila, docketed as Civil Case No. 86-36818. Upon her motion, the case was consolidated with Civil Case No. 85-33962. On May 30 1990, the trial court rendered a decision in favor of private respondent. On appeal by petitioners to the Court of Appeals, the said court affirmed the decision of the Regional Trial Court. Hence, this petition. II According to petitioners, the Court of Appeals erred: (1) When it gave full faith and credit to the Deed of Sale (Exh. "A") in favor of private respondent, instead of the Deed of Sale (Exh. "B" and its translation, Exh. "C") in favor of petitioner Ong Ching Po.

(2) When it concluded that the acts of petitioners were not acts of ownership; and (3) When it ruled that no express nor implied trust existed between petitioners and private respondent (Rollo, pp. 17-18). As stated by petitioners themselves, what is in dispute ". . . is not so much as to which between Exhibit "A" and "Exhibit "B" is more weighty, but whether this document is what it purports to be (i.e., a deed of conveyance in favor of Soledad Parian [private respondent] or it was only resorted to or executed as a subterfuge because the real buyer (Ong Ching Po) was an alien and it was agreed upon between Ong Ching Po and his brother (Ong Yee, Soledad Parian's husband) that the land be registered in the name of Soledad Parian in order to avoid legal complications and to facilitate registration and transfer and that the said title would be transferred by Soledad to Ong Ching Po or his successors-in-interest and that she would be holding the title in trust for him" (Rollo, pp. 19-20). We cannot go along with the claim that petitioner Ong Ching Po merely used private respondent as a dummy to have the title over the parcel of land registered in her name because being an alien he was disqualified to own real property in the Philippines. To sustain such an outrageous contention would be giving a high premium to a violation of our nationalization laws. Assuming that Exhibit "B" is in existence and that it was duly executed, still petitioners cannot claim ownership of the disputed lot by virtue thereof. Section 5, Article XIII of the 1935 Constitution provides, as follows: Save in cases of hereditary succession, no private agricultural land shall be transferred or assigned except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain in the Philippines. Section 14, Article XIV of the 1973 Constitution provides, as follows: Save in cases of hereditary succession, no private land shall be transferred or conveyed except to individuals, corporations, or associations qualified to acquire or hold lands in the public domain. Section 7, Article XII of the 1987 Constitution provides: Save in cases of hereditary succession, no private lands shall be transferred or conveyed except to individuals, corporations, or associations qualified to acquire or hold lands in the public domain. The capacity to acquire private land is made dependent upon the capacity to acquire or hold lands of the public domain. Private land may be transferred or conveyed only to individuals or entities "qualified to acquire lands of the public domain" (II Bernas, The Constitution of the Philippines 439-440 [1988 ed.]). The 1935 Constitution reserved the right to participate in the "disposition, exploitation, development and utilization" of all "lands of the public domain and other natural resources of the Philippines" for Filipino citizens or corporations at least sixty percent of the capital of which was owned by Filipinos. Aliens, whether individuals or corporations, have been disqualified from acquiring public lands; hence, they have also been disqualified from acquiring private lands. Petitioner Ong Ching Po was a Chinese citizen; therefore, he was disqualified from acquiring and owning real property. Assuming that the genuineness and due execution of Exhibit "B" has been established, the same is null and void, it being contrary to law. On the other end of the legal spectrum, the deed of sale executed by Ong Joi Jong in favor of private respondent (Exh. "A") is a notarized document. To remove the mantle of validity bestowed by law on said document, petitioners claim that private respondent admitted that she did not pay anything as consideration for the purported sale in her favor. In the same breath, petitioners said that private respondent implied in her deposition that it was her husband who paid for the property. It

appears, therefore, that the sale was financed out of conjugal funds and that it was her husband who handled the transaction for the purchase of the property. Such transaction is a common practice in Filipino-family affairs. It is not correct to say that private respondent never took possession of the property. Under the law, possession is transferred to the vendee by virtue of the notarized deed of conveyance. Under Article 1498 of the Civil Code of the Philippines, "when the sale is made through a public instrument, the execution thereof shall be equivalent to the delivery of the object of the contract, if from the deed the contrary does not appear or cannot clearly be inferred." If what petitioners meant was that private respondent never lived in the building constructed on said land, it was because her family had settled in Iloilo. There is no document showing the establishment of an express trust by petitioner Ong Ching Po as trustor and private respondent as trustee. Not even Exhibit "B" can be considered as such a document because private respondent, the registered owner of the property subject of said "deed of sale," was not a party thereto. The oral testimony to prove the existence of the express trust will not suffice. Under Article 1443 of the Civil Code of the Philippines, "No express trust concerning an immovable or any interest therein may be proved by parole evidence." Undaunted, petitioners argue that if they cannot prove an express trust in writing, they can prove an implied trust orally. While an implied trust may be proved orally (Civil Code of the Philippines, Art. 1457), the evidence must be trustworthy and received by the courts with extreme caution, because such kind of evidence may be easily fabricated (Salao v. Salao, 70 SCRA 65 [1976]). It cannot be made to rest on vague and uncertain evidence or on loose, equivocal or indefinite declarations (Cf. De Leon v. Molo-Peckson, et al., 116 Phil. 1267 [1962]). Petitioners do not claim that Ong Yee was not in a financial position to acquire the land and to introduce the improvements thereon. On the other hand, Yu Siok Lian, the wife of petitioner Ong Ching Po, admitted in her testimony in court that Ong Yee was a stockholder of Lam Sing Corporation and was engaged in business. The Court of Appeals did not give any credence to Exhibit "B" and its translation, Exhibit "C", because these documents had not been properly authenticated. Under Section 4, Rule 130 of the Revised Rules of Court: Secondary Evidence when Original is lost or destroyed. When the original writing has been lost or destroyed, or cannot be produced in court, upon proof of its execution and lost or destruction, or unavailability, its contents may be proved by a copy, or by a recital of its contents in some authentic document, or by the recollection of the witnesses. Secondary evidence is admissible when the original documents were actually lost or destroyed. But prior to the introduction of such secondary evidence, the proponent must establish the former existence of the document. The correct order of proof is as follows: existence; execution; loss; contents. This order may be changed if necessary in the discretion of the court (De Vera v. Aguilar, 218 SCRA 602 [1993]). Petitioners failed to adduce evidence as to the genuineness and due execution of the deed of sale, Exhibit "B". The due execution of the document may be established by the person or persons who executed it; by the person before whom its execution was acknowledged; or by any person who was present and saw it executed or who after its execution, saw it and recognized the signatures; or by a person to whom the parties to the instrument had previously confessed the execution thereof (De Vera v. Aguilar, supra). Petitioner Yu Siok Lian testified that she was present when said document was executed, but the trial court rejected her claim and held: If it is true that she was present, why did she not sign said document, even merely as a witness? Her oral testimony is easy to concoct or fabricate. Furthermore, she was married only on September 6, 1946 to the plaintiff, Ong Ching Po, in Baguio City where she apparently resided, or after the deed of sale was executed. The Court does not believe that she was present during the execution and signing of the deed of sale involved therein, notwithstanding her pretensions to the contrary (Decision p. 6, Records p. 414).

As to the contention of petitioners that all the tax receipts, tax declaration, rental receipts, deed of sale (Exh. "B") and transfer certificate of title were in their possession, private respondent explained that she and her husband entrusted said lot and building to petitioners when they moved to Iloilo. As observed by the Court of Appeals: We find, however, that these acts, even if true, are not necessarily reflective of dominion, as even a mere administrator or manager may lawfully perform them pursuant to his appointment or employment (Rollo, p. 10). It is markworthy that all the tax receipts were in the name of private respondent and her husband. The rental receipts were also in the name of her husband. WHEREFORE, the petition is DISMISSED. SO ORDERED. Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-6776 May 21, 1955

THE REGISTER OF DEEDS OF RIZAL, petitioner-appellee, vs. UNG SIU SI TEMPLE, respondent-appellant. Alejo F. Candido for appellant. Office of the Solicitor General Querube C. Makalintal and Solicitor Felix V. Makasiar for appellee. REYES, J.B.L., J.: The Register of Deeds for the province of Rizal refused to accept for record a deed of donation executed in due form on January 22, 1953, by Jesus Dy, a Filipino citizen, conveying a parcel of residential land, in Caloocan, Rizal, known as lot No. 2, block 48-D, PSD-4212, G.L.R.O. Record No. 11267, in favor of the unregistered religious organization "Ung Siu Si Temple", operating through three trustees all of Chinese nationality. The donation was duly accepted by Yu Juan, of Chinese nationality, founder and deaconess of the Temple, acting in representation and in behalf of the latter and its trustees. The refusal of the Registrar was elevated en Consultato the IVth Branch of the Court of First Instance of Manila. On March 14, 1953, the Court upheld the action of the Rizal Register of Deeds, saying: The question raised by the Register of Deeds in the above transcribed consulta is whether a deed of donation of a parcel of land executed in favor of a religious organization whose founder, trustees and administrator are Chinese citizens should be registered or not. It appearing from the record of the Consulta that UNG SIU SI TEMPLE is a religious organization whose deaconess, founder, trustees and administrator are all Chinese citizens, this Court is of the opinion and so hold that in view of the provisions of the sections 1 and 5 of Article XIII of the Constitution of the Philippines limiting the acquisition of land in the Philippines to its citizens, or to corporations or associations at least sixty per centum of the capital stock of which is owned by such citizens adopted after the enactment of said Act No. 271, and the decision of the Supreme Court in the case of Krivenko vs. the Register of Deeds of Manila, the deed of donation in question should not be admitted for admitted for registration. (Printed Rec. App. pp 17-18).

Not satisfied with the ruling of the Court of First Instance, counsel for the donee Uy Siu Si Temple has appealed to this Court, claiming: (1) that the acquisition of the land in question, for religious purposes, is authorized and permitted by Act No. 271 of the old Philippine Commission, providing as follows: SECTION 1. It shall be lawful for all religious associations, of whatever sort or denomination, whether incorporated in the Philippine Islands or in the name of other country, or not incorporated at all, to hold land in the Philippine Islands upon which to build churches, parsonages, or educational or charitable institutions. SEC. 2. Such religious institutions, if not incorporated, shall hold the land in the name of three Trustees for the use of such associations; . . .. (Printed Rec. App. p. 5.) and (2) that the refusal of the Register of Deeds violates the freedom of religion clause of our Constitution [Art. III, Sec. 1(7)]. We are of the opinion that the Court below has correctly held that in view of the absolute terms of section 5, Title XIII, of the Constitution, the provisions of Act No. 271 of the old Philippine Commission must be deemed repealed since the Constitution was enacted, in so far as incompatible therewith. In providing that, Save in cases of hereditary succession, no private agricultural land shall be transferred or assigned except to individuals, corporations or associations qualified to acquire or hold lands of the public domain in the Philippines, the Constitution makes no exception in favor of religious associations. Neither is there any such saving found in sections 1 and 2 of Article XIII, restricting the acquisition of public agricultural lands and other natural resources to "corporations or associations at least sixty per centum of the capital of which is owned by such citizens" (of the Philippines). The fact that the appellant religious organization has no capital stock does not suffice to escape the Constitutional inhibition, since it is admitted that its members are of foreign nationality. The purpose of the sixty per centum requirement is obviously to ensure that corporations or associations allowed to acquire agricultural land or to exploit natural resources shall be controlled by Filipinos; and the spirit of the Constitution demands that in the absence of capital stock, the controlling membership should be composed of Filipino citizens. To permit religious associations controlled by non-Filipinos to acquire agricultural lands would be to drive the opening wedge to revive alien religious land holdings in this country. We can not ignore the historical fact that complaints against land holdings of that kind were among the factors that sparked the revolution of 1896. As to the complaint that the disqualification under article XIII is violative of the freedom of religion guaranteed by Article III of the Constitution, we are by no means convinced (nor has it been shown) that land tenure is indispensable to the free exercise and enjoyment of religious profession or worship; or that one may not worship the Deity according to the dictates of his own conscience unless upon land held in fee simple. The resolution appealed from is affirmed, with costs against appellant.

Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. L-27952 February 15, 1982 TESTATE ESTATE OF JOSE EUGENIO RAMIREZ, MARIA LUISA PALACIOS, Administratrix, petitioner-appellee, vs. MARCELLE D. VDA. DE RAMIREZ, ET AL., oppositors, JORGE and ROBERTO RAMIREZ, legatees, oppositorsappellants. ABAD SANTOS, J.:

The main issue in this appeal is the manner of partitioning the testate estate of Jose Eugenio Ramirez among the principal beneficiaries, namely: his widow Marcelle Demoron de Ramirez; his two grandnephews Roberto and Jorge Ramirez; and his companion Wanda de Wrobleski. The task is not trouble-free because the widow Marcelle is a French who lives in Paris, while the companion Wanda is an Austrian who lives in Spain. Moreover, the testator provided for substitutions. Jose Eugenio Ramirez, a Filipino national, died in Spain on December 11, 1964, with only his widow as compulsory heir. His will was admitted to probate by the Court of First Instance of Manila, Branch X, on July 27, 1965. Maria Luisa Palacios was appointed administratrix of the estate. In due time she submitted an inventory of the estate as follows: INVENTARIO Una sexta parte (1/6) proindiviso de un te rreno, con sus mejoras y edificaciones, situadoen la Escolta, Manila............................................................. P500,000.00 Una sexta parte (1/6) proindiviso de dos parcelas de terreno situadas en Antipolo, Rizal................... 658.34 Cuatrocientos noventa y uno (491) acciones de la 'Central Azucarera de la Carlota a P17.00 por accion ................................................................................8,347.00 Diez mil ochocientos seize (10,806) acciones de la 'Central Luzon Milling Co.', disuelta y en liquidacion a P0.15 por accion ..............................................1,620.90 Cuenta de Ahorros en el Philippine Trust Co.............................................................................................. 2,350.73 TOTAL.............................................................. P512,976.97 MENOS: Deuda al Banco de las Islas Filipinas, garantizada con prenda de las acciones de La Carlota ......... P 5,000,00 VALOR LIQUIDO........................................... P507,976.97 The testamentary dispositions are as follows: A.En nuda propiedad, a D. Roberto y D. Jorge Ramirez, ambas menores de edad, residentes en Manila, I.F., calle 'Alright, No. 1818, Malate, hijos de su sobrino D. Jose Ma. Ramirez, con sustitucion vulgar a favor de sus respectivos descendientes, y, en su defecto, con sustitucion vulgar reciprocal entre ambos. El precedente legado en nuda propiedad de la participacion indivisa de la finca Santa Cruz Building, lo ordena el testador a favor de los legatarios nombrados, en atencion a que dicha propiedad fue creacion del querido padre del otorgante y por ser aquellos continuadores del apellido Ramirez, B.Y en usufructo a saber: a. En cuanto a una tercera parte, a favor de la esposa del testador, Da. Marcelle Ramirez, domiciliada en IE PECO, calle del General Gallieni No. 33, Seine Francia, con sustitucion vulgar u fideicomisaria a favor de Da. Wanda de Wrobleski, de Palma de Mallorca, Son Rapina Avenida de los Reyes 13, b.Y en cuanto a las dos terceras partes restantes, a favor de la nombrada Da. Wanda de Nrobleski con sustitucion vulgar v fideicomisaria a saber: En cuanto a la mitad de dichas dos terceras partes, a favor de D. Juan Pablo Jankowski, de Son Rapina Palma de Mallorca; y encuanto a la mitad restante, a favor de su sobrino, D. Horace V. Ramirez, San Luis Building, Florida St. Ermita, Manila, I.F. A pesar de las sustituciones fideiconiisarias precedentemente ordinadas, las usufiructuarias nombradas conjuntamente con los nudo propietarios, podran en cualquier memento vender a tercero los bienes objeto delegado, sin intervencion alguna de los titulares fideicomisaarios. On June 23, 1966, the administratrix submitted a project of partition as follows: the property of the deceased is to be divided into two parts. One part shall go to the widow 'en pleno dominio" in satisfaction of her legitime; the other part or "free portion" shall go to Jorge and Roberto Ramirez "en nuda propriedad." Furthermore, one third (1/3) of the free portion is charged with the widow's usufruct and the remaining two-thirds (2/3) with a usufruct in favor of Wanda. Jorge and Roberto opposed the project of partition on the grounds: (a) that the provisions for vulgar substitution in favor of Wanda de Wrobleski with respect to the widow's usufruct and in favor of Juan Pablo Jankowski and Horacio V. Ramirez, with respect to Wanda's usufruct are invalid because the first heirs Marcelle and Wanda) survived the testator; (b) that the provisions for fideicommissary substitutions are also invalid because the first heirs are not related to the second heirs or substitutes within the first degree, as provided in Article 863 of the Civil Code; (c) that the grant of a usufruct over real property in the Philippines in favor of Wanda Wrobleski, who is an alien, violates Section 5, Article III of the Philippine Constitution; and that (d) the proposed partition of the testator's interest in the Santa Cruz (Escolta) Building between the widow Marcelle and the appellants, violates the testator's express win to give this property to them Nonetheless, the lower court approved the project of partition in its order dated May 3, 1967. It is this order which Jorge and Roberto have appealed to this Court.

1. The widow's legitime. The appellant's do not question the legality of giving Marcelle one-half of the estate in full ownership. They admit that the testator's dispositions impaired his widow's legitime. Indeed, under Art. 900 of the Civil Code "If the only survivor is the widow or widower, she or he shall be entitled to one-half of the hereditary estate." And since Marcelle alone survived the deceased, she is entitled to one-half of his estate over which he could impose no burden, encumbrance, condition or substitution of any kind whatsoever. (Art. 904, par. 2, Civil Code.) It is the one-third usufruct over the free portion which the appellants question and justifiably so. It appears that the court a quo approved the usufruct in favor of Marcelle because the testament provides for a usufruct in her favor of one-third of the estate. The court a quo erred for Marcelle who is entitled to one-half of the estate "en pleno dominio" as her legitime and which is more than what she is given under the will is not entitled to have any additional share in the estate. To give Marcelle more than her legitime will run counter to the testator's intention for as stated above his dispositions even impaired her legitime and tended to favor Wanda. 2. The substitutions. It may be useful to recall that "Substitution is the appoint- judgment of another heir so that he may enter into the inheritance in default of the heir originally instituted." (Art. 857, Civil Code. And that there are several kinds of substitutions, namely: simple or common, brief or compendious, reciprocal, and fideicommissary (Art. 858, Civil Code.) According to Tolentino, "Although the Code enumerates four classes, there are really only two principal classes of substitutions: the simple and the fideicommissary. The others are merely variations of these two." (111 Civil Code, p. 185 [1973].) The simple or vulgar is that provided in Art. 859 of the Civil Code which reads: ART. 859. The testator may designate one or more persons to substitute the heir or heirs instituted in case such heir or heirs should die before him, or should not wish, or should be incapacitated to accept the inheritance. A simple substitution, without a statement of the cases to which it refers, shall comprise the three mentioned in the preceding paragraph, unless the testator has otherwise provided. The fideicommissary substitution is described in the Civil Code as follows: ART. 863. A fideicommissary substitution by virtue of which the fiduciary or first heir instituted is entrusted with the obligation to preserve and to transmit to a second heir the whole or part of inheritance, shall be valid and shall take effect, provided such substitution does not go beyond one degree from the heir originally instituted, and provided further that the fiduciary or first heir and the second heir are living at time of the death of the testator. It will be noted that the testator provided for a vulgar substitution in respect of the legacies of Roberto and Jorge Ramirez, the appellants, thus: con sustitucion vulgar a favor de sus respectivos descendientes, y, en su defecto, con substitution vulgar reciprocal entre ambos. The appellants do not question the legality of the substitution so provided. The appellants question the sustitucion vulgar y fideicomisaria a favor de Da. Wanda de Wrobleski" in connection with the one-third usufruct over the estate given to the widow Marcelle However, this question has become moot because as We have ruled above, the widow is not entitled to any usufruct. The appellants also question the sustitucion vulgar y fideicomisaria in connection with Wanda's usufruct over two thirds of the estate in favor of Juan Pablo Jankowski and Horace v. Ramirez. They allege that the substitution in its vulgar aspect as void because Wanda survived the testator or stated differently because she did not predecease the testator. But dying before the testator is not the only case for vulgar substitution for it also includes refusal or incapacity to accept the inheritance as provided in Art. 859 of the Civil Code, supra. Hence, the vulgar substitution is valid. As regards the substitution in its fideicommissary aspect, the appellants are correct in their claim that it is void for the following reasons: (a) The substitutes (Juan Pablo Jankowski and Horace V. Ramirez) are not related to Wanda, the heir originally instituted. Art. 863 of the Civil Code validates a fideicommissary substitution "provided such substitution does not go beyond one degree from the heir originally instituted." What is meant by "one degree" from the first heir is explained by Tolentino as follows: Scaevola Maura, and Traviesas construe "degree" as designation, substitution, or transmission. The Supreme Court of Spain has decidedly adopted this construction. From this point of view, there can be only one tranmission or substitution, and the substitute need not be related to the first heir. Manresa, Morell and Sanchez Roman, however, construe the word "degree" as generation, and the present Code has obviously followed this interpretation. by providing that the substitution shall not go beyond one degree "from the heir originally instituted." The Code thus clearly indicates that the second heir must be related to and be one generation from the first heir. From this, it follows that the fideicommissary can only be either a child or a parent of the first heir. These are the only relatives who are one generation or degree from the fiduciary ( Op. cit., pp. 193-194.) (b) There is no absolute duty imposed on Wanda to transmit the usufruct to the substitutes as required by Arts. 865 and 867 of the Civil Code. In fact, the appellee admits "that the testator contradicts the establishment of a fideicommissary

substitution when he permits the properties subject of the usufruct to be sold upon mutual agreement of the usufructuaries and the naked owners." (Brief, p. 26.) 3. The usufruct of Wanda. The appellants claim that the usufruct over real properties of the estate in favor of Wanda is void because it violates the constitutional prohibition against the acquisition of lands by aliens. The 1935 Constitution which is controlling provides as follows: SEC. 5. Save in cases of hereditary succession, no private agricultural land shall be transferred or assigned except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain in the Philippines. (Art. XIII.) The court a quo upheld the validity of the usufruct given to Wanda on the ground that the Constitution covers not only succession by operation of law but also testamentary succession. We are of the opinion that the Constitutional provision which enables aliens to acquire private lands does not extend to testamentary succession for otherwise the prohibition will be for naught and meaningless. Any alien would be able to circumvent the prohibition by paying money to a Philippine landowner in exchange for a devise of a piece of land. This opinion notwithstanding, We uphold the usufruct in favor of Wanda because a usufruct, albeit a real right, does not vest title to the land in the usufructuary and it is the vesting of title to land in favor of aliens which is proscribed by the Constitution. IN VIEW OF THE FOREGOING, the estate of Jose Eugenio Ramirez is hereby ordered distributed as follows: One-half (1/2) thereof to his widow as her legitime; One-half (1/2) thereof which is the free portion to Roberto and Jorge Ramirez in naked ownership and the usufruct to Wanda de Wrobleski with a simple substitution in favor of Juan Pablo Jankowski and Horace V. Ramirez. The distribution herein ordered supersedes that of the court a quo. No special pronouncement as to costs. SO ORDERED. Barredo (Chairman), Concepcion, Jr., De Castro, Ericta and Escolin, JJ., concur. Aquino J., took no part. Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-630 November 15, 1947 ALEXANDER A. KRIVENKO, petitioner-appellant, vs. THE REGISTER OF DEEDS, CITY OF MANILA, respondent and appellee. Gibbs, Gibbs, Chuidian and Quasha of petitioner-appellant. First Assistant Solicitor General Reyes and Solicitor Carreon for respondent-appellee. Marcelino Lontok appeared as amicus curies. MORAN, C.J.: Alenxander A. Kriventor alien, bought a residential lot from the Magdalena Estate, Inc., in December of 1941, the registration of which was interrupted by the war. In May, 1945, he sought to accomplish said registration but was denied by the register of deeds of Manila on the ground that, being an alien, he cannot acquire land in this jurisdiction. Krivenko then brought the case to the fourth branch of the Court of First Instance of Manila by means of a consulta, and that court rendered judgment sustaining the refusal of the register of deeds, from which Krivenko appealed to this Court. There is no dispute as to these facts. The real point in issue is whether or not an alien under our Constitution may acquire residential land. It is said that the decision of the case on the merits is unnecessary, there being a motion to withdraw the appeal which should have been granted outright, and reference is made to the ruling laid down by this Court in another case to the effect that a court should not pass upon a constitutional question if its judgment may be made to rest upon other grounds. There is, we believe, a confusion of ideas in this reasoning. It cannot be denied that the constitutional question is unavoidable if we choose to decide this case upon the merits. Our judgment cannot to be made to rest upon other grounds if we have to render any judgment at all. And we cannot avoid our judgment simply because we have to avoid a constitutional question. We cannot, for instance, grant the motion withdrawing the appeal only because we wish to evade the constitutional; issue. Whether the motion should be, or should not be, granted, is a question involving different considerations now to be stated. According to Rule 52, section 4, of the Rules of Court, it is discretionary upon this Court to grant a withdrawal of appeal after the briefs have been presented. At the time the motion for withdrawal was filed in this case, not only had the briefs been prensented, but the case had already been voted and the majority decision was being prepared. The motion for withdrawal stated no reason whatsoever, and the Solicitor General was agreeable to it. While the motion was pending in this Court, came the new circular of the Department of Justice, instructing all register of deeds to accept for registration all

transfers of residential lots to aliens. The herein respondent-appellee was naturally one of the registers of deeds to obey the new circular, as against his own stand in this case which had been maintained by the trial court and firmly defended in this Court by the Solicitor General. If we grant the withdrawal, the the result would be that petitioner-appellant Alexander A. Krivenko wins his case, not by a decision of this Court, but by the decision or circular of the Department of Justice, issued while this case was pending before this Court. Whether or not this is the reason why appellant seeks the withdrawal of his appeal and why the Solicitor General readily agrees to that withdrawal, is now immaterial. What is material and indeed very important, is whether or not we should allow interference with the regular and complete exercise by this Court of its constitutional functions, and whether or not after having held long deliberations and after having reached a clear and positive conviction as to what the constitutional mandate is, we may still allow our conviction to be silenced, and the constitutional mandate to be ignored or misconceived, with all the harmful consequences that might be brought upon the national patromony. For it is but natural that the new circular be taken full advantage of by many, with the circumstance that perhaps the constitutional question may never come up again before this court, because both vendors and vendees will have no interest but to uphold the validity of their transactions, and very unlikely will the register of deeds venture to disobey the orders of their superior. Thus, the possibility for this court to voice its conviction in a future case may be remote, with the result that our indifference of today might signify a permanent offense to the Constitution. All thse circumstances were thoroughly considered and weighted by this Court for a number of days and the legal result of the last vote was a denial of the motion withdrawing the appeal. We are thus confronted, at this stage of the proceedings, with our duty, the constitutional question becomes unavoidable. We shall then proceed to decide that question. Article XIII, section 1, of the Constitutional is as follows: Article XIII. Conservation and utilization of natural resources. SECTION 1. All agricultural, timber, and mineral lands of the public domain, water, minerals, coal, petroleum, and other mineral oils, all forces of potential energy, and other natural resources of the Philippines belong to the State, and their disposition, exploitation, development, or utilization shall be limited to citizens of the Philippines, or to corporations or associations at least sixty per centum of the capital of which is owned by such citizens, subject to any existing right, grant, lease, or concession at the time of the inaguration of the Government established uunder this Constitution. Natural resources, with the exception of public agricultural land, shall not be alienated, and no licence, concession, or lease for the exploitation, development, or utilization of any of the natural resources shall be granted for a period exceeding twenty-five years, renewable for another twenty-five years, except as to water rights for irrigation, water supply, fisheries, or industrial uses other than the development of water "power" in which cases beneficial use may be the measure and the limit of the grant. The scope of this constitutional provision, according to its heading and its language, embraces all lands of any kind of the public domain, its purpose being to establish a permanent and fundamental policy for the conservation and utilization of all natural resources of the Nation. When, therefore, this provision, with reference to lands of the public domain, makes mention of only agricultural, timber and mineral lands, it means that all lands of the public domain are classified into said three groups, namely, agricultural, timber and mineral. And this classification finds corroboration in the circumstance that at the time of the adoption of the Constitution, that was the basic classification existing in the public laws and judicial decisions in the Philippines, and the term "public agricultural lands" under said classification had then acquired a technical meaning that was well-known to the members of the Constitutional Convention who were mostly members of the legal profession. As early as 1908, in the case of Mapa vs. Insular Government (10 Phil., 175, 182), this Court said that the phrase "agricultural public lands" as defined in the Act of Congress of July 1, 1902, which phrase is also to be found in several sections of the Public Land Act (No. 926), means "those public lands acquired from Spain which are neither mineral for timber lands." This definition has been followed in long line of decisions of this Court. ( See Montano vs. Insular Government, 12 Phil., 593; Ibaez de Aldecoa vs. Insular Government, 13 Phil., 159; Ramos vs. Director of Lands, 39 Phil., 175; Jocson vs. Director of Forestry, 39 Phil., 560; Ankron vs. Government of the Philippines, 40 Phil., 10.) And with respect to residential lands, it has been held that since they are neither mineral nor timber lands, of necessity they must be classified as agricultural. In Ibaez de Aldecoa vs. Insular Government (13 Phil., 159, 163), this Court said: Hence, any parcel of land or building lot is susceptible of cultivation, and may be converted into a field, and planted with all kinds of vegetation; for this reason, where land is not mining or forestal in its nature, it must necessarily be included within the classification of agricultural land, not because it is actually used for the purposes of agriculture, but because it was originally agricultural and may again become so under other circumstances; besides, the Act of Congress contains only three classification, and makes no special provision with respect to building lots or urban lands that have ceased to be agricultural land. In other words, the Court ruled that in determining whether a parcel of land is agricultural, the test is not only whether it is actually agricultural, but also its susceptibility to cultivation for agricultural purposes. But whatever the test might be, the fact remains that at the time the Constitution was adopted, lands of the public domain were classified in our laws and jurisprudence into agricultural, mineral, and timber, and that the term "public agricultural lands" was construed as referring to those lands that were not timber or mineral, and as including residential lands. It may safely be presumed, therefore, that what the members of the Constitutional Convention had in mind when they drafted the Constitution was this wellknown classification and its technical meaning then prevailing. Certain expressions which appear in Constitutions, . . . are obviously technical; and where such words have been in use prior to the adoption of a Constitution, it is presumed that its framers and the people who ratified it have

used such expressions in accordance with their technical meaning. (11 Am. Jur., sec. 66, p. 683.) Also Calder vs. Bull, 3 Dall. [U.S.], 386; 1 Law. ed., 648; Bronson vs. Syverson, 88 Wash., 264; 152 P., 1039.) It is a fundamental rule that, in construing constitutions, terms employed therein shall be given the meaning which had been put upon them, and which they possessed, at the time of the framing and adoption of the instrument. If a word has acquired a fixed, technical meaning in legal and constitutional history, it will be presumed to have been employed in that sense in a written Constitution. (McKinney vs. Barker, 180 Ky., 526; 203 S.W., 303; L.R.A., 1918 E, 581.) Where words have been long used in a technical sense and have been judicially construed to have a certain meaning, and have been adopted by the legislature as having a certain meaning prior to a particular statute in which they are used, the rule of construction requires that the words used in such statute should be construed according to the sense in which they have been so previously used, although the sense may vary from strict literal meaning of the words. (II Sutherland, Statutory Construction, p. 758.) Therefore, the phrase "public agricultural lands" appearing in section 1 of Article XIII of the Constitution must be construed as including residential lands, and this is in conformity with a legislative interpretation given after the adoption of the Constitution. Well known is the rule that "where the Legislature has revised a statute after a Constitution has been adopted, such a revision is to be regarded as a legislative construction that the statute so revised conforms to the Constitution." (59 C.J., 1102.) Soon after the Constitution was adopted, the National Assembly revised the Public Land Law and passed Commonwealth Act No. 141, and sections 58, 59 and 60 thereof permit the sale of residential lots to Filipino citizens or to associations or corporations controlled by such citizens, which is equivalent to a solemn declaration that residential lots are considered as agricultural lands, for, under the Constitution, only agricultural lands may be alienated. It is true that in section 9 of said Commonwealth Act No. 141, "alienable or disposable public lands" which are the same "public agriculture lands" under the Constitution, are classified into agricultural, residential, commercial, industrial and for other puposes. This simply means that the term "public agricultural lands" has both a broad and a particular meaning. Under its broad or general meaning, as used in the Constitution, it embraces all lands that are neither timber nor mineral. This broad meaning is particularized in section 9 of Commonwealth Act No. 141 which classifies "public agricultural lands" for purposes of alienation or disposition, into lands that are stricly agricultural or actually devoted to cultivation for agricultural puposes; lands that are residential; commercial; industrial; or lands for other purposes. The fact that these lands are made alienable or disposable under Commonwealth Act No. 141, in favor of Filipino citizens, is a conclusive indication of their character as public agricultural lands under said statute and under the Constitution. It must be observed, in this connection that prior to the Constitution, under section 24 of Public Land Act No. 2874, aliens could acquire public agricultural lands used for industrial or residential puposes, but after the Constitution and under section 23 of Commonwealth Act No. 141, the right of aliens to acquire such kind of lands is completely stricken out, undoubtedly in pursuance of the constitutional limitation. And, again, prior to the Constitution, under section 57 of Public Land Act No. 2874, land of the public domain suitable for residence or industrial purposes could be sold or leased to aliens, but after the Constitution and under section 60 of Commonwealth Act No. 141, such land may only be leased, but not sold, to aliens, and the lease granted shall only be valid while the land is used for the purposes referred to. The exclusion of sale in the new Act is undoubtedly in pursuance of the constitutional limitation, and this again is another legislative construction that the term "public agricultural land" includes land for residence purposes. Such legislative interpretation is also in harmony with the interpretation given by the Executive Department of the Government. Way back in 1939, Secretary of Justice Jose Abad Santos, in answer to a query as to "whether or not the phrase 'public agricultural lands' in section 1 of Article XII (now XIII) of the Constitution may be interpreted to include residential, commercial, and industrial lands for purposes of their disposition," rendered the following short, sharp and crystal-clear opinion: Section 1, Article XII (now XIII) of the Constitution classifies lands of the public domain in the Philippines into agricultural, timber and mineral. This is the basic classification adopted since the enactment of the Act of Congress of July 1, 1902, known as the Philippine Bill. At the time of the adoption of the Constitution of the Philippines, the term 'agricultural public lands' and, therefore, acquired a technical meaning in our public laws. The Supreme Court of the Philippines in the leading case of Mapa vs. Insular Government, 10 Phil., 175, held that the phrase 'agricultural public lands' means those public lands acquired from Spain which are neither timber nor mineral lands. This definition has been followed by our Supreme Court in many subsequent case. . . . Residential commercial, or industrial lots forming part of the public domain must have to be included in one or more of these classes. Clearly, they are neither timber nor mineral, of necessity, therefore, they must be classified as agricultural. Viewed from another angle, it has been held that in determining whether lands are agricultural or not, the character of the land is the test (Odell vs. Durant, 62 N.W., 524; Lorch vs. Missoula Brick and Tile Co., 123 p.25). In other words, it is the susceptibility of the land to cultivation for agricultural purposes by ordinary farming methods which determines whether it is agricultural or not (State vs. Stewart, 190 p. 129). Furthermore, as said by the Director of Lands, no reason is seen why a piece of land, which may be sold to a person if he is to devote it to agricultural, cannot be sold to him if he intends to use it as a site for his home. This opinion is important not alone because it comes from a Secratary of Justice who later became the Chief Justice of this Court, but also because it was rendered by a member of the cabinet of the late President Quezon who actively

participated in the drafting of the constitutional provision under consideration. (2 Aruego, Framing of the Philippine Constitution, p. 598.) And the opinion of the Quezon administration was reiterated by the Secretary of Justice under the Osmea administration, and it was firmly maintained in this Court by the Solicitor General of both administrations. It is thus clear that the three great departments of the Government judicial, legislative and executive have always maintained that lands of the public domain are classified into agricultural, mineral and timber, and that agricultural lands include residential lots. Under section 1 of Article XIII of the Constitution, "natural resources, with the exception of public agricultural land, shall not be aliented," and with respect to public agricultural lands, their alienation is limited to Filipino citizens. But this constitutional purpose conserving agricultural resources in the hands of Filipino citizens may easily be defeated by the Filipino citizens themselves who may alienate their agricultural lands in favor of aliens. It is partly to prevent this result that section 5 is included in Article XIII, and it reads as follows: Sec. 5. Save in cases of hereditary succession, no private agricultural land will be transferred or assigned except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain in the Philippines. This constitutional provision closes the only remaining avenue through which agricultural resources may leak into aliens' hands. It would certainly be futile to prohibit the alienation of public agricultural lands to aliens if, after all, they may be freely so alienated upon their becoming private agricultural lands in the hands of Filipino citizens. Undoubtedly, as above indicated, section 5 is intended to insure the policy of nationalization contained in section 1. Both sections must, therefore, be read together for they have the same purpose and the same subject matter. It must be noticed that the persons against whom the prohibition is directed in section 5 are the very same persons who under section 1 are disqualified "to acquire or hold lands of the public domain in the Philippines." And the subject matter of both sections is the same, namely, the nontransferability of "agricultural land" to aliens. Since "agricultural land" under section 1 includes residential lots, the same technical meaning should be attached to "agricultural land under section 5. It is a rule of statutory construction that "a word or phrase repeated in a statute will bear the same meaning throughout the statute, unless a different intention appears." (II Sutherland, Statutory Construction, p. 758.) The only difference between "agricultural land" under section 5, is that the former is public and the latter private. But such difference refers to ownership and not to the class of land. The lands are the same in both sections, and, for the conservation of the national patrimony, what is important is the nature or class of the property regardless of whether it is owned by the State or by its citizens. Reference is made to an opinion rendered on September 19, 1941, by the Hon. Teofilo Sison, then Secretary of Justice, to the effect that residential lands of the public domain may be considered as agricultural lands, whereas residential lands of private ownership cannot be so considered. No reason whatsoever is given in the opinion for such a distinction, and no valid reason can be adduced for such a discriminatory view, particularly having in mind that the purpose of the constitutional provision is the conservation of the national patrimony, and private residential lands are as much an integral part of the national patrimony as the residential lands of the public domain. Specially is this so where, as indicated above, the prohibition as to the alienable of public residential lots would become superflous if the same prohibition is not equally applied to private residential lots. Indeed, the prohibition as to private residential lands will eventually become more important, for time will come when, in view of the constant disposition of public lands in favor of private individuals, almost all, if not all, the residential lands of the public domain shall have become private residential lands. It is maintained that in the first draft of section 5, the words "no land of private ownership" were used and later changed into "no agricultural land of private ownership," and lastly into "no private agricultural land" and from these changes it is argued that the word "agricultural" introduced in the second and final drafts was intended to limit the meaning of the word "land" to land actually used for agricultural purposes. The implication is not accurate. The wording of the first draft was amended for no other purpose than to clarify concepts and avoid uncertainties. The words "no land" of the first draft, unqualified by the word "agricultural," may be mistaken to include timber and mineral lands, and since under section 1, this kind of lands can never be private, the prohibition to transfer the same would be superfluous. Upon the other hand, section 5 had to be drafted in harmony with section 1 to which it is supplementary, as above indicated. Inasmuch as under section 1, timber and mineral lands can never be private, and the only lands that may become private are agricultural lands, the words "no land of private ownership" of the first draft can have no other meaning than "private agricultural land." And thus the change in the final draft is merely one of words in order to make its subject matter more specific with a view to avoiding the possible confusion of ideas that could have arisen from the first draft. If the term "private agricultural lands" is to be construed as not including residential lots or lands not strictly agricultural, the result would be that "aliens may freely acquire and possess not only residential lots and houses for themselves but entire subdivisions, and whole towns and cities," and that "they may validly buy and hold in their names lands of any area for building homes, factories, industrial plants, fisheries, hatcheries, schools, health and vacation resorts, markets, golf courses, playgrounds, airfields, and a host of other uses and purposes that are not, in appellant's words, strictly agricultural." (Solicitor General's Brief, p. 6.) That this is obnoxious to the conservative spirit of the Constitution is beyond question. One of the fundamental principles underlying the provision of Article XIII of the Constitution and which was embodied in the report of the Committee on Nationalization and Preservation of Lands and other Natural Resources of the Constitutional Convention, is "that lands, minerals, forests, and other natural resources constitute the exclusive heritage of the Filipino nation. They should, therefore, be preserved for those under the sovereign authority of that nation and for their posterity." (2 Aruego, Framing of the Filipino Constitution, p. 595.) Delegate Ledesma, Chairman of the Committee on

Agricultural Development of the Constitutional Convention, in a speech delivered in connection with the national policy on agricultural lands, said: "The exclusion of aliens from the privilege of acquiring public agricultural lands and of owning real estate is a necessary part of the Public Land Laws of the Philippines to keep pace with the idea of preserving the Philippines for the Filipinos." (Emphasis ours.) And, of the same tenor was the speech of Delegate Montilla who said: "With the complete nationalization of our lands and natural resources it is to be understood that our God-given birthright should be one hundred per cent in Filipino hands . . .. Lands and natural resources are immovables and as such can be compared to the vital organs of a person's body, the lack of possession of which may cause instant death or the shortening of life. If we do not completely antionalize these two of our most important belongings, I am afraid that the time will come when we shall be sorry for the time we were born. Our independence will be just a mockery, for what kind of independence are we going to have if a part of our country is not in our hands but in those of foreigners?" (Emphasis ours.) Professor Aruego says that since the opening days of the Constitutional Convention one of its fixed and dominating objectives was the conservation and nationalization of the natural resources of the country. (2 Aruego, Framing of the Philippine Constitution, p 592.) This is ratified by the members of the Constitutional Convention who are now members of this Court, namely, Mr. Justice Perfecto, Mr. Justice Briones, and Mr. Justice Hontiveros. And, indeed, if under Article XIV, section 8, of the Constitution, an alien may not even operate a small jitney for hire, it is certainly not hard to understand that neither is he allowed to own a pieace of land. This constitutional intent is made more patent and is strongly implemented by an act of the National Assembly passed soon after the Constitution was approved. We are referring again to Commonwealth Act No. 141. Prior to the Constitution, there were in the Public Land Act No. 2874 sections 120 and 121 which granted aliens the right to acquire private only by way of reciprocity. Said section reads as follows: SEC. 120. No land originally acquired in any manner under the provisions of this Act, nor any permanent improvement on such land, shall be encumbered, alienated, or transferred, except to persons, corporations, associations, or partnerships who may acquire lands of the public domain under this Act; to corporations organized in the Philippine Islands authorized therefor by their charters, and, upon express authorization by the Philippine Legislature, to citizens of countries the laws of which grant to citizens of the Philippine Islands the same right to acquire, hold, lease, encumber, dispose of, or alienate land, or permanent improvements thereon, or any interest therein, as to their own citizens, only in the manner and to the extent specified in such laws, and while the same are in force but not thereafter. SEC. 121. No land originally acquired in any manner under the provisions of the former Public Land Act or of any other Act, ordinance, royal order, royal decree, or any other provision of law formerly in force in the Philippine Islands with regard to public lands, terrenos baldios y realengos, or lands of any other denomination that were actually or presumptively of the public domain or by royal grant or in any other form, nor any permanent improvement on such land, shall be encumbered, alienated, or conveyed, except to persons, corporations, or associations who may acquire land of the public domain under this Act; to corporate bodies organized in the Philippine Islands whose charters may authorize them to do so, and, upon express authorization by the Philippine Legislature, to citizens of the countries the laws of which grant to citizens of the Philippine Islands the same right to acquire, hold, lease, encumber, dispose of, or alienate land or pemanent improvements thereon or any interest therein, as to their own citizens, and only in the manner and to the extent specified in such laws, and while the same are in force, but not thereafter: Provided, however, That this prohibition shall not be applicable to the conveyance or acquisition by reason of hereditary succession duly acknowledged and legalized by competent courts, nor to lands and improvements acquired or held for industrial or residence purposes, while used for such purposes: Provided, further, That in the event of the ownership of the lands and improvements mentioned in this section and in the last preceding section being transferred by judicial decree to persons,corporations or associations not legally capacitated to acquire the same under the provisions of this Act, such persons, corporations, or associations shall be obliged to alienate said lands or improvements to others so capacitated within the precise period of five years, under the penalty of such property reverting to the Government in the contrary case." (Public Land Act, No. 2874.) It is to be observed that the pharase "no land" used in these section refers to all private lands, whether strictly agricultural, residential or otherwise, there being practically no private land which had not been acquired by any of the means provided in said two sections. Therefore, the prohibition contained in these two provisions was, in effect, that no private land could be transferred to aliens except "upon express authorization by the Philippine Legislature, to citizens of Philippine Islands the same right to acquire, hold, lease, encumber, dispose of, or alienate land." In other words, aliens were granted the right to acquire private land merely by way of reciprocity. Then came the Constitution and Commonwealth Act No. 141 was passed, sections 122 and 123 of which read as follows: SEC. 122. No land originally acquired in any manner under the provisions of this Act, nor any permanent improvement on such land, shall be encumbered, alienated, or transferred, except to persons, corporations, associations, or partnerships who may acquire lands of the public domain under this Act or to corporations organized in the Philippines authorized thereof by their charters. SEC. 123. No land originally acquired in any manner under the provisions of any previous Act, ordinance, royal order, royal decree, or any other provision of law formerly in force in the Philippines with regard to public lands terrenos baldios y realengos, or lands of any other denomination that were actually or presumptively of the public domain, or by royal grant or in any other form, nor any permanent improvement on such land, shall be

encumbered, alienated, or conveyed, except to persons, corporations or associations who may acquire land of the public domain under this Act or to corporate bodies organized in the Philippines whose charters authorize them to do so: Provided, however, That this prohibition shall not be applicable to the conveyance or acquisition by reason of hereditary succession duly acknowledged and legalized by competent courts: Provided, further, That in the event of the ownership of the lands and improvements mentioned in this section and in the last preceding section being transferred by judicial decree to persons, corporations or associations not legally capacitated to acquire the same under the provisions of this Act, such persons, corporations, or associations shall be obliged to alienate said lands or improvements to others so capacitated within the precise period of five years; otherwise, such property shall revert to the Government. These two sections are almost literally the same as sections 120 and 121 of Act No. 2874, the only difference being that in the new provisions, the right to reciprocity granted to aliens is completely stricken out. This, undoubtedly, is to conform to the absolute policy contained in section 5 of Article XIII of the Constitution which, in prohibiting the alienation of private agricultural lands to aliens, grants them no right of reciprocity. This legislative construction carries exceptional weight, for prominent members of the National Assembly who approved the new Act had been members of the Constitutional Convention. It is said that the lot question does not come within the purview of sections 122 and 123 of Commonwealth Act No. 141, there being no proof that the same had been acquired by one of the means provided in said provisions. We are not, however, diciding the instant case under the provisions of the Public Land Act, which have to refer to land that had been formerly of the public domain, otherwise their constitutionality may be doubtful. We are deciding the instant case under section 5 of Article XIII of the Constitution which is more comprehensive and more absolute in the sense that it prohibits the transfer to alien of any private agricultural land including residential land whatever its origin might have been. And, finally, on June 14, 1947, the Congress approved Republic Act No. 133 which allows mortgage of "private real property" of any kind in favor of aliens but with a qualification consisting of expressly prohibiting aliens to bid or take part in any sale of such real property as a consequence of the mortgage. This prohibition makes no distinction between private lands that are strictly agricultural and private lands that are residental or commercial. The prohibition embraces the sale of private lands of any kind in favor of aliens, which is again a clear implementation and a legislative interpretation of the constitutional prohibition. Had the Congress been of opinion that private residential lands may be sold to aliens under the Constitution, no legislative measure would have been found necessary to authorize mortgage which would have been deemed also permissible under the Constitution. But clearly it was the opinion of the Congress that such sale is forbidden by the Constitution and it was such opinion that prompted the legislative measure intended to clarify that mortgage is not within the constitutional prohibition. It is well to note at this juncture that in the present case we have no choice. We are construing the Constitution as it is and not as we may desire it to be. Perhaps the effect of our construction is to preclude aliens, admitted freely into the Philippines from owning sites where they may build their homes. But if this is the solemn mandate of the Constitution, we will not attempt to compromise it even in the name of amity or equity. We are satisfied, however, that aliens are not completely excluded by the Constitution from the use of lands for residential purposes. Since their residence in the Philippines is temporary, they may be granted temporary rights such as a lease contract which is not forbidden by the Constitution. Should they desire to remain here forever and share our fortunes and misfortunes, Filipino citizenship is not impossible to acquire. For all the foregoing, we hold that under the Constitution aliens may not acquire private or public agricultural lands, including residential lands, and, accordingly, judgment is affirmed, without costs. Feria, Pablo, Perfecto, Hilado, and Briones, JJ., concur. Republic Act No. 7042 (As amended by RA 8179) AN ACT TO PROMOTE FOREIGN INVESTMENTS, PRESCRIBE THE PROCEDURES FOR REGISTERING ENTERPRISES DOING BUSINESS IN THE PHILIPPINES, AND FOR OTHER PURPOSES Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled: SECTION 1. Title. - This Act shall be known as the Foreign Investments Act of 1991. SEC. 2. Declaration of Policy. - It is the policy of the State to attract, promote and welcome productive investments from foreign individuals, partnerships, corporations, and governments, including their political subdivisions, in activities which significantly contribute to national industrialization and socio-economic development to the extent that foreign investment is allowed in such activity by the Constitution and relevant laws. Foreign investments shall be encouraged in enterprises that significantly expand livelihood and employment opportunities for Filipinos; enhance economic value of farm products; promote the welfare of Filipino consumers; expand the scope, quality and volume of exports and their access to foreign markets; and/or transfer relevant technologies in agriculture, industry and support services. Foreign investments shall be welcome as a supplement to Filipino capital and technology in those enterprises serving mainly the domestic market. As a general rule, there are no restrictions on extent of foreign ownership of export enterprises. In domestic market enterprises, foreigners can invest as much as one hundred percent (100%) equity except in areas included in the negative

list. Foreign owned firms catering mainly to the domestic market shall be encouraged to undertake measures that will gradually increase Filipino participation in their businesses by taking in Filipino partners, electing Filipinos to the board of directors, implementing transfer of technology to Filipinos, generating more employment for the economy and enhancing skills of Filipino workers.

SEC. 3. Definitions. - As used in this Act: a) the term Philippine National shall mean a citizen of the Philippines or a domestic partnership or association wholly owned by citizens of the Philippines; or a corporation organized under the laws of the Philippines of which at least sixty percent (60%) of the capital stock outstanding and entitled to vote is owned and held by citizens of the Philippines or a corporation organized abroad and registered as doing business in the Philippine under the Corporation Code of which one hundred percent (100%) of the capital stock outstanding and entitled to vote is wholly owned by Filipinos or a trustee of funds for pension or other employee retirement or separation benefits, where the trustee is a Philippine national and at least sixty percent (60%) of the fund will accrue to the benefit of Philippine nationals: Provided, That where a corporation and its non-Filipino stockholders own stocks in a Securities and Exchange Commission (SEC) registered enterprise, at least sixty percent (60%) of the capital stock outstanding and entitled to vote of each of both corporations must be owned and held by citizens of the Philippines and at least sixty percent (60%) of the members of the Board of Directors of each of both corporations must be citizens of the Philippines, in order that the corporation shall be considered a Philippine national; (as amended by R.A. 8179). b) the term investment shall mean equity participation in any enterprise organized or existing under the laws of the Philippines; c) the term foreign investment shall mean an equity investment made by a nonPhilippine national in the form of foreign exchange and/or other assets actually transferred to the Philippines and duly registered with the Central Bank which shall assess and appraise the value of such assets other than foreign exchange;d) the phrase doing business shall include soliciting orders, service contracts, opening offices, whether called liaison offices or branches; appointing representatives or distributors domiciled in the Philippines or who in any calendar year stay in the country for a period or periods totaling one hundred eighty (180) days or more; participating in the management, supervision or control of any domestic business, firm, entity or corporation in the Philippines; and any other act or acts that imply a continuity of commercial dealings or arrangements, and contemplate to that extent the performance of acts or works, or the exercise of some of the functions normally incident to, and in progressive prosecution of, commercial gain or of the purpose and object of the business organization: Provided, however, That the phrase doing business shall not be deemed to include mere investment as a shareholder by a foreign entity in domestic corporations duly registered to do business, and/or the exercise of rights as such investor; nor having a nominee director or officer to represent its interests in such corporation; nor appointing a representative or distributor domiciled in the Philippines which transacts business in its own name and for its own account; e) the term export enterprise shall mean an enterprise wherein a manufacturer, processor or service (including tourism) enterprise exports sixty percent (60%) or more of its output, or wherein a trader purchases products domestically and exports sixty percent (60%) or more of such purchases; f) the term domestic market enterprise shall mean an enterprise which produces goods for sale, or renders services to the domestic market entirely or if exporting a portion of its output fails to consistently export at least sixty percent (60%) thereof; and g) the term Foreign Investments Negative List or Negative List shall mean a list of areas of economic activity whose foreign ownership is limited to a maximum of forty percent (40%) of the equity capital of the enterprises engaged therein. SEC. 4. Scope. - This Act shall not apply to banking and other financial institutions which are governed and regulated by the General Banking Act and other laws under the supervision of the Central Bank. SEC. 5. Registration of Investments of Non-Philippine Nationals. - Without need of prior approval, a non-Philippine national, as that term is defined in Section 3 a), and not otherwise disqualified by law may, upon registration with the Securities and Exchange Commission (SEC), or with the Bureau of Trade Regulation and Consumer Protection (BTRCP) of the Department of Trade and Industry in the case of single proprietorships, do business as defined in Section 3 d) of this Act or invest in a domestic enterprise up to one hundred percent (100%) of its capital, unless participation of nonPhilippine nationals in the enterprise is prohibited or limited to a smaller percentage by existing law and/or under the provisions of this Act. The SEC or BTRCP, as the case may be, shall not impose any limitations on the extent of foreign ownership in an enterprise additional to those provided in this Act: Provided, however, That any enterprise seeking to avail of incentives under the Omnibus Investment Code of 1987 must apply for registration with the Board of Investments

(BOI), which shall process such application for registration in accordance with the criteria for evaluation prescribed in said Code: Provided, finally, That a non-Philippine national intending to engage in the same line of business as an existing joint venture, in which he or his majority shareholder is a substantial partner, must disclose the fact and the names and addresses of the partners in the existing joint venture in his application for registration with SEC. During the transitory period as provided in Section 15 hereof, SEC shall disallow registration of the applying non-Philippine national if the existing joint venture enterprise, particularly the Filipino partners therein, can reasonably prove they are capable to make the investment needed for the domestic market activities to be undertaken by the competing applicant. Upon effectivity of this Act, SEC shall effect registration of any enterprise applying under this Act within fifteen (15) days upon submission of completed requirements.SEC. 6. Foreign Investment in Export Enterprises. - Foreign investment in export enterprises whose products and services do not fall within Lists A and B of the Foreign Investment Negative List provided under Section 8 hereof is allowed up to one hundred percent (100%) ownership. Export enterprises which are non-Philippine nationals shall register with BOI and submit the reports that may be required to ensure continuing compliance of the export enterprise with its export requirement. BOI shall advise SEC or BTRCP, as the case may be, of any export enterprise that fails to meet the export ratio requirement. The SEC or BTRCP shall thereupon order the noncomplying export enterprise to reduce its sales to the domestic market to not more than forty percent (40%) of its total production; failure to comply with such SEC or BTRCP order, without justifiable reason, shall subject the enterprise to cancellation of SEC or BTRCP registration, and/or the penalties provided in Section 14 hereof. SEC. 7. Foreign Investment in Domestic Market Enterprises. - Non-Philippine nationals may own up to one hundred percent (100%) of domestic market enterprises unless foreign ownership therein is prohibited or limited by the Constitution existing law or the Foreign Investment Negative List under Section 8 hereof. (As amended by R.A. 8179) SEC. 8. List of Investment Areas Reserved to Philippine Nationals (Foreign Investment Negative List). - The Foreign Investment Negative List shall have two (2) components lists; A, and B. a) List A shall enumerate the areas of activities reserved to Philippine nationals by mandate of the Constitution and specific laws. b) List B shall contain the areas of activities and enterprises regulated pursuant to law: 1) which are defense-related activities, requiring prior clearance and authorization from Department of National Defense (DND) to engage in such activity, such as the manufacture, repair, storage and/or distribution of firearms, ammunition, lethal weapons, military ordinance, explosives, pyrotechnics and similar materials; unless such manufacturing or repair activity is specifically authorized, with a substantial export component, to a non-Philippine national by the Secretary of National Defense; or 2) which have implications on public health and morals, such as the manufacture and distribution of dangerous drugs; all forms of gambling; nightclubs, bars, beerhouses, dance halls; sauna and steam bathhouses and massage clinics. Small and medium-sized domestic market enterprises, with paid-in equity capital less than the equivalent two hundred thousand US dollars (US$200,000) are reserved to Philippine nationals, Provided that if: (1) they involve advanced technology as determined by the Department of Science and Technology or (2) they employ at least fifty (50) direct employees, then a minimum paid-in capital of one hundred thousand US dollars (US$100,000.00) shall be allowed to non-Philippine nationals. Amendments to List B may be made upon recommendation of the Secretary of National Defense, or the Secretary of Health, or the Secretary of Education, Culture and Sports, endorsed by the NEDA, approved by the President, and promulgated by a Presidential Proclamation. Transitory Foreign Investment Negative List established in Sec. 15 hereof shall be replaced at the end of the transitory period by the first Regular Negative List to be formulated and recommended by NEDA, following the process and criteria provided in Sections 8 of this Act. The first Regular Negative List shall be published not later than sixty (60) days before the end of the transitory period provided in said section, and shall become immediately effective at the nd of the transitory period. Subsequent Foreign Investment Negative Lists shall become effective fifteen (15) days after publication in a newspaper of general circulation in the Philippines: Provided, however, That each Foreign Investment Negative List shall be prospective in operation and shall in no way affect foreign investment existing on the date of its publication. Amendments to List B after promulgation and publication of the first Regular Foreign Investment Negative List at the end of the transitory period shall not be made more often than once every two (2) years. (As amended by R.A. 8179) SEC. 9. Investment Rights of Former Natural-born Filipinos. - For the purpose of this Act, former natural born citizens of the Philippines shall have the same investment rights of a Philippine citizen in Cooperatives under Republic Act No.

6938, Rural Banks under Republic Act No. 7353, Thrift Banks and Private Development Banks under Republic Act No. 7906, and Financing Companies under Republic Act No. 5980. These rights shall not extend to activities reserved by the Constitution, including (1) the exercise of profession; (2) in defense related activities under Section 8 (b) hereof. Unless specifically authorized by the Secretary of National Defense; and, (3) activities covered by Republic Act No. 1180 (Retail Trade Act). Republic Act No. 5187 (Security Agency Act), Republic Act No. 7076 (Small Scale Mining Act), Republic Act No. 3018. As amended (Rice and Corn Industry Act). And P.D. 449 (Cockpits Operation and Management). (As amended by R.A. 8179) SEC. 10. Other Rights of Natural Born Citizen Pursuant to the Provisions of Article XII, Section 8 of the Constitution. - Any natural born citizen who has lost his Philippine citizenship and who has the legal capacity to enter into a contract under Philippine laws may be a transferee of a private land up to a maximum area of five thousand (5,000) square meters in the case of urban land or three (3) hectares in the case of rural land to be used by him for business or other purposes. In the case of married couples, one of them may avail of the privilege herein granted: Provided, That if both shall avail of the same, the total area acquired shall not exceed the maximum herein fixed. In the case the transferee already owns urban or rural land for business or other purposes, he shall still be entitled to be a transferee of additional urban or rural land for business or other purposes which when added to those already owned by him shall not exceed the maximum areas herein authorized. A transferee under this Act may acquire not more than two (2) lots which should be situated in different municipalities or cities anywhere in the Philippines: Provided, That the total land area thereof shall not exceed five thousand (5,000) square meters in the case of urban land or three (3) hectares in the case of rural land for use by him for business or other purposes. A transferee who has already acquired urban land shall be disqualified from acquiring rural land and vice versa. (As amended by R.A. 8179)

Republic of the Philippines SUPREME COURT EN BANC G.R. No. 129546 December 13, 2005 PROVINCE OF RIZAL, MUNICIPALITY OF SAN MATEO, PINTONG BOCAUE MULTIPURPOSE COOPERATIVE, CONCERNED CITIZENS OF RIZAL, INC., ROLANDO E. VILLACORTE, BERNARDO HIDALGO, ANANIAS EBUENGA, VILMA T. MONTAJES, FEDERICO MUNAR, JR., ROLANDO BEAS, SR., ET AL., and KILOSBAYAN, INC., Petitioners, vs. EXECUTIVE SECRETARY, SECRETARY OF ENVIRONMENT & NATURAL RESOURCES, LAGUNA LAKE DEVELOPMENT AUTHORITY, SECRETARY OF PUBLIC WORKS & HIGHWAYS, SECRETARY OF BUDGET & MANAGEMENT, METRO MANILA DEVELOPMENT AUTHORITY and THE HONORABLE COURT OF APPEALS,Respondents. DECISION CHICO-NAZARIO, J.: 1 The earth belongs in usufruct to the living. At the height of the garbage crisis plaguing Metro Manila and its environs, parts of the Marikina Watershed Reservation were set aside by the Office of the President, through Proclamation No. 635 dated 28 August 1995, for use as a sanitary landfill and similar waste disposal applications. In fact, this site, extending to more or less 18 hectares, had already been 2 in operation since 19 February 1990 for the solid wastes of Quezon City, Marikina, San Juan, Mandaluyong, Pateros, 3 Pasig, and Taguig. This is a petition filed by the Province of Rizal, the municipality of San Mateo, and various concerned citizens for review on certiorari of the Decision of the Court of Appeals in CA-G.R. SP No. 41330, denying, for lack of cause of action, the petition for certiorari, prohibition and mandamus with application for a temporary restraining order/writ of preliminary injunction assailing the legality and constitutionality of Proclamation No. 635. The facts are documented in painstaking detail. On 17 November 1988, the respondent Secretaries of the Department of Public Works and Highways (DPW H) and the Department of Environment and Natural Resources (DENR) and the Governor of the Metropolitan Manila Commission 4 (MMC) entered into a Memorandum of Agreement (MOA), which provides in part: 1. The DENR agrees to immediately allow the utilization by the Metropolitan Manila Commission of its land property located at Pintong Bocaue in San Mateo, Rizal as a sanitary landfill site, subject to whatever restrictions that the government impact assessment might require. 2. Upon signing of this Agreement, the DPWH shall commence the construction/development of said dumpsite.

3. The MMC shall: a) take charge of the relocation of the families within and around the site; b) oversee the development of the areas as a sanitary landfill; c) coordinate/monitor the construction of infrastructure facilities by the DPWH in the said site; and d) ensure that the necessary civil works are properly undertaken to safeguard against any negative environmental impact in the area. On 7, 8 and 10 February 1989, the Sangguniang Bayan of San Mateo wrote Gov. Elfren Cruz of the MMC, Sec. Fiorello Estuar of the DPWH, the Presidential Task Force on Solid Waste Management, Executive Secretary Catalino Macaraig, and Sec. Fulgencio Factoran, Jr., pointing out that it had recently passed a Resolution banning the creation of dumpsites for Metro Manila garbage within its jurisdiction, asking that their side be heard, and that the addressees "suspend and temporarily hold in abeyance all and any part of your operations with respect to the San Mateo Landfill Dumpsite." No action was taken on these letters. It turns out that the land subject of the MOA of 17 November 1988 and owned by the DENR was part of the Marikina Watershed Reservation Area. Thus, on 31 May 1989, forest officers of the Forest Engineering and Infrastructure Unit of the Community Environment and Natural Resource Office, (CENRO) DENR-IV, Rizal Province, submitted a 5 Memorandum on the "On-going Dumping Site Operation of the MMC inside (the) Upper Portion of Marikina Watershed Reservation, located at Barangay Pintong Bocaue, San Mateo, Rizal, and nearby localities." Said Memorandum reads in part: Observations: 3.1 The subject area is arable and agricultural in nature; 3.2 Soil type and its topography are favorable for agricultural and forestry productions; ... 3.5 Said Dumping Site is observed to be confined within the said Watershed Reservation, bearing in the northeastern part of Lungsod Silangan Townsite Reservation. Such illegal Dumping Site operation inside (the) Watershed Reservation is in violation of P.D. 705, otherwise known as the Revised Forestry Code, as amended. . . Recommendations: 5.1 The MMC Dumping Site Inside Marikina Watershed Reservation, particularly at Brgy. Pintong Bocaue, San Mateo, Rizal and at Bo. Pinugay, Baras/Antipolo, Rizal which are the present garbage zones must totally be stopped and discouraged without any political intervention and delay in order to save our healthy ecosystems found therein, to avoid much destruction, useless efforts and lost (sic) of millions of public funds over the land in question ; (Emphasis ours) 6 On 19 June 1989, the CENRO submitted another Investigation Report to the Regional Executive Director which states in part that: 1. About two (2) hectares had been excavated by bulldozers and garbage dumping operations are going on. 2. The dumping site is without the concurrence of the Provincial Governor, Rizal Province and without any permit from DENR who has functional jurisdiction over the Watershed Reservation; and 3. About 1,192 families residing and cultivating areas covered by four (4) Barangays surrounding the dumping site will adversely be affected by the dumping operations of MMC including their sources of domestic water supply. x x x x 7 On 22 January 1990, the CENRO submitted still another Investigation Report to the Regional Executive Director which states that: Findings show that the areas used as Dumping Site of the MMC are found to be within the Marikina Watershed which are part of the Integrated Social Forestry Project (ISF) as per recorded inventory of Forest Occupancy of this office. It also appears that as per record, there was no permit issued to the MMC to utilize these portions of land for dumping purposes. It is further observed that the use of the areas as dumping site greatly affects the ecological balance and environmental factors in this community. On 19 February 1990, the DENR Environmental Management Bureau, through Undersecretary for Environment and Research Celso R. Roque, granted the Metro Manila Authority (MMA [formerly MMC]) an Environmental Compliance Certificate (ECC) for the operation of a two-and-a-half-hectare garbage dumpsite. The ECC was sought and granted to comply with the requirement of Presidential Decree No. 1586 "Establishing an Environmental Impact Statement System," Section 4 of which states in part that, "No persons, partnership or corporation shall undertake or operate any such declared environmentally critical project or area without first securing an Environmental Compliance Certificate." Proclamation No. 2146, passed on 14 December 1981, designates "all areas declared by law as national parks, watershed reserves, wildlife preserves, and sanctuaries" as "Environmentally Critical Areas." On 09 March 1990, respondent Laguna Lake Development Authority (LLDA), through its Acting General Manager, sent a 8 letter to the MMA, which reads in part: Through this letter we would like to convey our reservation on the choice of the sites for solid waste disposal inside the watershed of Laguna Lake. As you may already know, the Metropolitan Waterworks and Sewerage System (MWSS) has scheduled the abstraction of water from the lake to serve the needs of about 1.2 million residents of Muntinlupa, Paranaque, Las Pinas and Bacoor, Cavite by 1992. Accordingly, the Laguna Lake Development Authority (LLDA) is accelerating its environmental management program to upgrade the water quality of the lake in order to make it suitable as a source of domestic water supplythe whole year round. The said program regards dumpsites as incompatible within the watershed because of the heavy pollution, including the risk of diseases, generated by

such activities which would negate the governments efforts to upgrade the water quality of the lake. Consequently, please consider our objection to the proposed location of the dumpsites within the watershed. (Emphasis supplied by petitioners) On 31 July 1990, less than six months after the issuance of the ECC, Undersecretary Roque suspended the ECC in a 9 letter addressed to the respondent Secretary of DPWH, stating in part that: Upon site investigation conducted by Environmental Management Bureau staff on development activities at the San Mateo Landfill Site, it was ascertained that ground slumping and erosion have resulted from improper development of the site. We believe that this will adversely affect the environmental quality in the area if the proper remedial measures are not instituted in the design of the landfill site. This is therefore contradictory to statements made in the Environmental Impact Statement (EIS) submitted that above occurrences will be properly mitigated. In view of this, we are forced to suspend the Environmental Compliance Certificate (ECC) issued until appropriate modified plans are submitted and approved by this Office for implementation. (Emphasis ours) On 21 June 1993, the Acting Mayor of San Mateo, Enrique Rodriguez, Jr., Barangay Captain Dominador Vergara, and 10 petitioner Rolando E. Villacorte, Chairman of the Pintong Bocaue Multipurpose Cooperative (PBMC) wrote then President Fidel V. Ramos expressing their objections to the continued operation of the MMA dumpsite for causing "unabated pollution and degradation of the Marikina Watershed Reservation." 11 On 14 July 1993, another Investigation Report submitted by the Regional Technical Director to the DENR Undersecretary for Environment and Research contained the following findings and recommendations: Remarks and Findings: .... 5. Interview with Mr. Dayrit, whose lot is now being endangered because soil erosion have (sic) caused severe siltation and sedimentation of the Dayrit Creek which water is greatly polluted by the dumping of soil bulldozed to the creek; 6. Also interview with Mrs. Vilma Montajes, the multi-grade teacher of Pintong Bocaue Primary School which is located only about 100 meters from the landfill site. She disclosed that bad odor have (sic) greatly affected the pupils who are sometimes sick with respiratory illnesses. These odors show that MMA have (sic) not instituted/sprayed any disinfectant chemicals to prevent air pollution in the area. Besides large flies (Bangaw) are swarming all over the playground of the school. The teacher also informed the undersigned that plastic debris are being blown whenever the wind blows in their direction. 7. As per investigation report there are now 15 hectares being used as landfill disposal sites by the MMA. The MMA is intending to expand its operation within the 50 hectares. 8. Lots occupied within 50 hectares are fully planted with fruit bearing trees like Mangoes, Santol, Jackfruit, Kasoy, Guyabano, Kalamansi and Citrus which are now bearing fruits and being harvested and marketed to nearby San Mateo Market and Masinag Market in Antipolo. .... Recommendations: 1. As previously recommended, the undersigned also strongly recommend(s) that the MMA be made to relocate the landfill site because the area is within the Marikina Watershed Reservation and Lungsod Silangan. The leachate treatment plant ha(s) been eroded twice already and contaminated the nearby creeks which is the source of potable water of the residents. The contaminated water also flows to Wawa Dam and Boso-boso River which also flows to Laguna de Bay. 2. The proposed Integrated Social Forestry Project be pushed through or be approved. ISF project will not only uplift the socio-economic conditions of the participants but will enhance the rehabilitation of the Watershed considering that fruit bearing trees are vigorously growing in the area. Some timber producing species are also planted like Mahogany and Gmelina Arboiea. There are also portions where dipterocarp residuals abound in the area. 3. The sanitary landfill should be relocated to some other area, in order to avoid any conflict with the local government of San Mateo and the nearby affected residents who have been in the area for almost 10-20 years. 12 On 16 November 1993, DENR Secretary Angel C. Alcala sent MMA Chairman Ismael A. Mathay, Jr. a letter stating that "after a series of investigations by field officials" of the DENR, the agency realized that the MOA entered into on 17 November 1988 "is a very costly error because the area agreed to be a garbage dumpsite is inside the Marikina Watershed Reservation." He then strongly recommended that all facilities and infrastructure in the garbage dumpsite in Pintong Bocaue be dismantled, and the garbage disposal operations be transferred to another area outside the Marikina Watershed Reservation to protect "the health and general welfare of the residents of San Mateo in particular and the residents of Metro Manila in general." 13 On 06 June 1995, petitioner Villacorte, Chairman of the PBMC, wrote President Ramos, through the Executive Secretary, informing the President of the issues involved, that the dumpsite is located near three public elementary schools, the closest of which is only fifty meters away, and that its location "violates the municipal zoning ordinance of San Mateo and, in truth, the Housing and Land Use Regulatory Board had denied the then MMA chairmans application for a locational clearance on this ground." 14 On 21 August 1995, the Sangguniang Bayan of San Mateo issued a Resolution "expressing a strong objection to the planned expansion of the landfill operation in Pintong Bocaue and requesting President Ramos to disapprove the draft Presidential Proclamation segregating 71.6 Hectares from Marikina Watershed Reservation for the landfill site in Pintong Bocaue, San Mateo, Rizal."

Despite the various objections and recommendations raised by the government agencies aforementioned, the Office of the President, through Executive Secretary Ruben Torres, signed and issued Proclamation No. 635 on 28 August 1995, "Excluding from the Marikina Watershed Reservation Certain Parcels of Land Embraced Therein for Use as Sanitary Landfill Sites and Similar Waste Disposal Under the Administration of the Metropolitan Manila Development Authority." The pertinent portions thereof state: WHEREAS, to cope with the requirements of the growing population in Metro Manila and the adjoining provinces and municipalities, certain developed and open portions of the Marikina Watershed Reservation, upon the recommendation of the Secretary of the Department of Environment and Natural Resources should now be excluded form the scope of the reservation; WHEREAS, while the areas delineated as part of the Watershed Reservations are intended primarily for use in projects and/or activities designed to contain and preserve the underground water supply, other peripheral areas had been included within the scope of the reservation to provide for such space as may be needed for the construction of the necessary structures, other related facilities, as well as other priority projects of government as may be eventually determined; WHEREAS, there is now an urgent need to provide for, and develop, the necessary facilities for the disposal of the waste generated by the population of Metro Manila and the adjoining provinces and municipalities, to ensure their sanitary and /or hygienic disposal; WHEREAS, to cope with the requirements for the development of the waste disposal facilities that may be used, portions of the peripheral areas of the Marikina Watershed Reservation, after due consideration and study, have now been identified as suitable sites that may be used for the purpose; WHEREAS, the Secretary of the Department of Environment and Natural Resources has recommended the exclusion of these areas that have been so identified from the Marikina Watershed Reservation so that they may then be developed for the purpose; NOW, THEREFORE, for and in consideration of the aforecited premises, I, Fidel V. Ramos, President of the Philippines, by virtue of the powers vested in me by law, do hereby ordain: Section 1. General That certain parcels of land, embraced by the Marikina Watershed Reservation, were found needed for use in the solid waste disposal program of the government in Metropolitan Manila, are hereby excluded from that which is held in reserve and are now made available for use as sanitary landfill and such other related waste disposal applications. Section 2. Purpose The areas being excluded from the Marikina Watershed Reservation are hereby placed under the administration of the Metropolitan Manila Development Authority, for development as Sanitary Landfill, and/or for use in the development of such other related waste disposal facilities that may be used by the cities and municipalities of Metro Manila and the adjoining province of Rizal and its municipalities. Section 3. Technical Description Specifically, the areas being hereby excluded from the Marikina Watershed Reservation consist of two (2) parcels, with an aggregate area of approximately ONE MILLION SIXTY THOUSAND FIVE HUNDRED TWENTY NINE (1,060,529) square meters more or less, as follows: x x x x Section 4. Reservations The development, construction, use and/or operation of any facility that may be established within the parcel of land herein excluded from the Marikina Watershed Reservation shall be governed by existing laws, rules and regulations pertaining to environmental control and management. When no longer needed for sanitary landfill purposes or the related waste disposal activities, the parcels of land subject of this proclamation shall revert back as part of the Marikina Watershed Reservation, unless otherwise authorized. On 06 September 1995, Director Wilfrido S. Pollisco of the Protected Areas and Wildlife Bureau wrote the DENR Secretary to express the bureaus stand against the dumpsite at Pintong Bocaue, and that "it is our view . . . that the mere presence of a garbage dumpsite inside a watershed reservation is definitely not compatible with the very purpose and objectives for which the reservation was established." On 24 November 1995, the petitioners Municipality of San Mateo and the residents of Pintong Bocaue, represented by former Senator Jovito Salonga, sent a letter to President Ramos requesting him to reconsider Proclamation No. 635. Receiving no reply, they sent another letter on 02 January 1996 reiterating their previous request. On 04 March 1996, then chairman of the Metro Manila Development Authority (MMDA [formerly MMA]) Prospero I. Oreta addressed a letter to Senator Salonga, stating in part that: . 2. Considering the circumstances under which we are pursuing the project, we are certain you will agree that, unless we are prepared with a better alternative, the project simply has to be pursued in the best interest of the greater majority of the population, particularly their health and welfare." 2.1 The San Mateo Sanitary Landfill services, at least, 38% of the waste disposal site requirements of Metro Manila where an estimated 9 million population reside. 2.2 Metro Manila is presently estimated to be generating, at least, 15,700 cubic meters of household or municipal waste, a 1.57 hectare of land area will be filled in a months time with a pile 31 meters high of garbage, or in a year, the accumulated volume will require 18.2 hectares. .... 4. The sanitary landfill projects are now on their fifth year of implementation. The amount of effort and money already invested in the project by the government cannot easily be disregarded, much more set aside in favor of the few

settlers/squatters who chose to ignore the earlier notice given to them that the area would be used precisely for the development of waste disposal sites, and are now attempting to arouse opposition to the project. 4.2 There is no place within the jurisdiction of Metro Manila, with an area big enough to accommodate at least 3 to 5 years of waste disposal requirements. x x x x 4.21 The present site at San Mateo was selected because, at the time consideration was being made, and up to the present, it is found to have the attributes that positively respond to the criteria established: 4.21.1 The site was a government property and would not require any outlay for it to be acquired. 4.21.2 It is far from any sizeable community/settlements that could be affected by the development that would be introduced and yet, was within economic hauling distance from the areas they are designed to serve. 4.21.21 At the time it was originally decided to locate the landfills at the present site, there were not more that fifteen (15) settlers in the area and they had hardly established themselves. The community settlements were located far from the site. 4.21.22 The area was hardly accessible, especially to any public transport. The area was being served by a public utility jeep that usually made only two (2) trips daily. During the rainy season, it could only be reached by equipping the vehicle with tire chains to traverse the slippery muddy trail roads. 4.21.3 There was, at least, seventy-three (73) hectares available at the site. 4.3 While the site was within the Marikina Watershed Reservation under the administration of the DENR, the site was located at the lower periphery of the buffer zone; was evaluated to be least likely to affect the underground water supply; and could, in fact, be excluded from the reservation. 4.31 It was determined to be far from the main water containment area for it to pose any immediate danger of contaminating the underground water, in case of a failure in any of the mitigating measures that would be installed. 4.32 It was likewise too far from the nearest body of water, the Laguna Lake, and the distance, plus the increasing accumulation of water from other tributaries toward the lake, would serve to dilute and mitigate any contamination it may emit, in case one happened. 4.33 To resolve the recurring issue regarding its being located within the Marikina Watershed Reservation, the site had been recommended by the DENR, and approved by the President, to already be excluded from the Marikina Watershed reservation and placed under the administration of MMDA, since the site was deemed to form part of the land resource reserve then commonly referred to as buffer zone. 5. Contrary to the impression that you had been given, relocating the site at this point and time would not be easy, if not impracticable, because aside from the investments that had been made in locating the present site, further investments have been incurred in: 5.1 The conduct of the technical studies for the development being implemented. Through a grant-in-aid from the World Bank, US$600,000 was initially spent for the conduct of the necessary studies on the area and the design of the landfill. This was augmented by, at least, another P1.5 million from the government for the studies to be completed, or a total cost at the time (1990) of approximately P20 million. 5.2. Additionally, the government has spent approximately P33 million in improving on the roadway to make the site accessible from the main road/highway. 5.3 To achieve the necessary economies in the development of the site, the utilities had been planned so that their use could be maximized. These include the access roads, the drainage system, the leacheate collection system, the gas collection system, and the waste water treatment system. Their construction are designed so that instead of having to construct independent units for each area, the use of existing facilities can be maximized through a system of interconnection. On the average, the government is spending P14.8 million to develop a hectare of sanitary landfill area. 6. Despite the preparations and the investments that are now being made on the project, it is estimated that the total available area, at an accelerated rate of disposal, assuming that all open dump sites were to be closed, will only last for 39 months. 6.1 We are still hard pressed to achieve advanced development on the sites to assure against any possible crisis in garbage from again being experienced in Metro Manila, aside from having to look for the additional sites that may be used after the capacities shall have been exhausted. 6.2 Faced with the prospects of having the 15,700 cubic meters of garbage generated daily strewn all over Metro Manila, we are certain you will agree that it would be futile to even as much as consider a suspension of the waste disposal operations at the sanitary landfills. On 22 July 1996, the petitioners filed before the Court of Appeals a civil action for certiorari, prohibition andmandamus with application for a temporary restraining order/writ of preliminary injunction. The hearing on the prayer for preliminary injunction was held on 14 August 1996. 15 On 13 June 1997, the court a quo rendered a Decision, the dispositive part of which reads: WHEREFORE, the petition for certiorari, prohibition and mandamus with application for a temporary restraining order/writ 16 of preliminary injunction for lack of cause of action, is hereby DENIED. Hence, this petition for review on certiorari of the above decision on the following grounds: I The Court of Appeals erred and abused its discretion in deliberately ignoring the significant fact that Presidential Proclamation No. 635 was based on a brazen forgery it was supposedly issued, as stated in the proclamation itself and repeatedly asserted by respondents in their comment, on the basis of the alleged recommendation of the DENR Secretary

dated June 26, 1995 but which assertion was denounced by the then Secretary Angel C. Alcala himself in a sworn statement dated September 18, 1996 and again during the special hearing of the case in the Court of Appeals on November 13, 1996 as a forgery since his signature on the alleged recommendation had been falsified, as now admitted by respondents themselves in their comment filed with the Court of Appeals, through the Office of the Solicitor General. II The Court of Appeals erred and abused its discretion in completely ignoring the significant fact that the respondents are operating the landfill based on a spurious Environmental Compliance Certificate. III The Court of Appeals erred in ruling that the respondents did not violate R.A. 7586 when they issued and implemented Proclamation No. 635 considering that the withdrawal or disestablishment of a protected area or the modification of the Marikina Watershed can only be done by an act of Congress. IV The Court of Appeals erred and abused its discretion when it deliberately and willfully brushed aside the unanimous findings and adverse recommendations of responsible government agencies and non-partisan officials concerned with environmental protection in favor of the self-serving, gratuitous assertions found in the unsolicited, partisan letter of former Malabon Mayor, now Chairman Prospero Oreta of the MMDA who is an interested party in this case. V The Court of Appeals erred when it readily swallowed respondents assertion that the San Mateo Dumpsite "is located in the Buffer Zone of the reservation" and is therefore outside of its boundaries, and even declared in its decision that it t ook "serious note" of this particular argument. VI The Court of Appeals erred and abused its discretion when it encroached on the function of Congress by expressing its unjustified fear of mini-smokey mountains proliferating in Metro Manila and justifying its decision in favor of "an integrated system of solid waste management like the San Mateo Landfill. On 05 January 1998, while the appeal was pending, the petitioners filed a Motion for Temporary Restraining 17 Order, pointing out that the effects of the El Nio phenomenon would be aggravated by the relentless destruction of the Marikina Watershed Reservation. They noted that respondent MMDA had, in the meantime, continued to expand the area of the dumpsite inside the Marikina Watershed Reservation, cutting down thousands of mature fruit trees and forest trees, and leveling hills and mountains to clear the dumping area. Garbage disposal operations were also being conducted on a 24-hour basis, with hundreds of metric tons of wastes being dumped daily, including toxic and infectious hospital wastes, 18 intensifying the air, ground and water pollution. The petitioners reiterated their prayer that respondent MMDA be temporarily enjoined from further dumping waste into the site and from encroaching into the area beyond its existing perimeter fence so as not to render the case moot and academic. 19 On 28 January 1999, the petitioners filed a Motion for Early Resolution, calling attention to the continued expansion of the dumpsite by the MMDA that caused the people of Antipolo to stage a rally and barricade the Marcos Highway to stop the dump trucks from reaching the site for five successive days from 16 January 1999. On the second day of the barricade, all the municipal mayors of the province of Rizal openly declared their full support for the rally, and notified the 20 MMDA that they would oppose any further attempt to dump garbage in their province. As a result, MMDA officials, headed by then Chairman Jejomar Binay, agreed to abandon the dumpsite after six months. Thus, the municipal mayors of Rizal, particularly the mayors of Antipolo and San Mateo, agreed to the use of the dumpsite 21 until that period, which would end on 20 July 1999. 22 On 13 July 1999, the petitioners filed an Urgent Second Motion for Early Resolution in anticipation of violence between the conflicting parties as the date of the scheduled closure of the dumpsite neared. On 19 July 1999, then President Joseph E. Estrada, taking cognizance of the gravity of the problems in the affected areas and the likelihood that violence would erupt among the parties involved, issued a Memorandum ordering the closure of the 23 dumpsite on 31 December 2000. Accordingly, on 20 July 1999, the Presidential Committee on Flagship Programs and Projects and the MMDA entered into a MOA with the Provincial Government of Rizal, the Municipality of San Mateo, and the City of Antipolo, wherein the latter agreed to further extend the use of the dumpsite until its permanent closure on 31 24 December 2000. On 11 January 2001, President Estrada directed Department of Interior and Local Government Secretary Alfredo Lim and MMDA Chairman Binay to reopen the San Mateo dumpsite "in view of the emergency situation of uncollected garbage in 25 Metro Manila, resulting in a critical and imminent health and sanitation epidemic." Claiming the above events constituted a "clear and present danger of violence erupting in the affected areas," the 26 petitioners filed an Urgent Petition for Restraining Order on 19 January 2001. On 24 January 2001, this Court issued the Temporary Restraining Order prayed for, "effective immediately and until 27 further orders." Meanwhile, on 26 January 2001, Republic Act No. 9003, otherwise known as "The Ecological Solid Waste Management Act of 2000," was signed into law by President Estrada. 28 Thus, the petitioners raised only two issues in their Memorandum of 08 February 2005: 1) whether or not respondent MMDA agreed to the permanent closure of the San Mateo Landfill as of December 2000, and 2) whether or not the permanent closure of the San Mateo landfill is mandated by Rep. Act No. 9003.

We hold that the San Mateo Landfill will remain permanently closed. Although the petitioners may be deemed to have waived or abandoned the issues raised in their previous pleadings but 29 not included in the memorandum, certain events we shall relate below have inclined us to address some of the more pertinent issues raised in the petition for the guidance of the herein respondents, and pursuant to our symbolic function to 30 educate the bench and bar. The law and the facts indicate that a mere MOA does not guarantee the dumpsites permanent closure. The rally and barricade staged by the people of Antipolo on 28 January 1999, with the full support of all the mayors of Rizal Province caused the MMDA to agree that it would abandon the dumpsite after six months. In return, the municipal mayors allowed the use of the dumpsite until 20 July 1999. On 20 July 1999, with much fanfare and rhetoric, the Presidential Committee on Flagship Programs and Projects and the MMDA entered into a MOA with the Provincial Government of Rizal, the Municipality of San Mateo, and the City of Antipolo, whereby the latter agreed to an extension for the use of the dumpsite until 31 December 2000, at which time it would be permanently closed. Despite this agreement, President Estrada directed Department of Interior and Local Government Secretary Alfredo Lim and MMDA Chairman Binay to reopen the San Mateo dumpsite on 11 January 2001, "in view of the emergency situation of uncollected garbage in Metro Manila, resulting in a critical and imminent health and sanitation epidemic;" our issuance of a TRO on 24 January 2001 prevented the dumpsites reopening. Were it not for the TRO, then President Estradas instructions would have been lawfully carried out, for as we observed in Oposa v. Factoran, the freedom of contract is not absolute. Thus: .. In Abe vs. Foster Wheeler Corp., this Court stated: "The freedom of contract, under our system of government, is not meant to be absolute. The same is understood to be subject to reasonable legislative regulation aimed at the promotion of public health, moral, safety and welfare. In other words, the constitutional guaranty of non-impairment of obligations of contract is limited by the exercise of the police power of the State, in the interest of public health, safety, moral and general welfare." The reason for this is emphatically set forth in Nebia vs. New York, quoted in Philippine American Life Insurance Co. vs. Auditor General, to wit: "'Under our form of government the use of property and the making of contracts are normally matters of private and not of public concern. The general rule is that both shall be free of governmental interference. But neither property rights nor contract rights are absolute; for government cannot exist if the citizen may at will use his property to the detriment of his fellows, or exercise his freedom of contract to work them harm. Equally fundamental with the private right is that of the public to regulate it in the common interest .'" In short, the nonimpairment clause must yield to the police power of the state. (Citations omitted, emphasis supplied) We thus feel there is also the added need to reassure the residents of the Province of Rizal that this is indeed a final resolution of this controversy, for a brief review of the records of this case indicates two self-evident facts.First, the San Mateo site has adversely affected its environs , and second, sources of water should always be protected. As to the first point, the adverse effects of the site were reported as early as 19 June 1989, when the Investigation Report of the Community Environment and Natural Resources Officer of DENR-IV-1 stated that the sources of domestic water 31 supply of over one thousand families would be adversely affected by the dumping operations. The succeeding report included the observation that the use of the areas as dumping site greatly affected the ecological balance and 32 environmental factors of the community. Respondent LLDA in fact informed the MMA that the heavy pollution and risk of disease generated by dumpsites rendered the location of a dumpsite within the Marikina Watershed Reservation 33 incompatible with its program of upgrading the water quality of the Laguna Lake. The DENR suspended the sites ECC after investigations revealed ground slumping and erosion had resulted from 34 35 improper development of the site. Another Investigation Report submitted by the Regional Technical Director to the DENR reported respiratory illnesses among pupils of a primary school located approximately 100 meters from the site, as well as the constant presence of large flies and windblown debris all over the schools playground. It further reiterated reports that the leachate treatment plant had been eroded twice already, contaminating the nearby creeks that were sources of potable water for the residents. The contaminated water was also found to flow to the Wawa Dam and Boso-boso River, which in turn empties into Laguna de Bay. This brings us to the second self-evident point. Water is life, and must be saved at all costs. In Collado v. Court of 36 Appeals, we had occasion to reaffirm our previous discussion in Sta. Rosa Realty Development Corporation v. Court of 37 Appeals, on the primordial importance of watershed areas, thus: "The most important product of a watershed is water, which is one of the most important human necessities. The protection of watersheds ensures an adequate supply of water for future generations and the control of flashfloods that not only damage property but also cause loss of lives. Protection 38 of watersheds is an "intergenerational" responsibility that needs to be answered now. Three short months before Proclamation No. 635 was passed to avert the garbage crisis, Congress had enacted the 39 National Water Crisis Act to "adopt urgent and effective measures to address the nationwide water crisis which adversely affects the health and well-being of the population, food production, and industrialization process. One of the 40 issues the law sought to address was the "protection and conservation of watersheds." In other words, while respondents were blandly declaring that "the reason for the creation of the Marikina Watershed Reservation, i.e., to protect Marikina River as the source of water supply of the City of Manila, no longer exists," the rest of the country was gripped by a shortage of potable water so serious, it necessitated its own legislation. Respondents actions in the face of such grave environmental consequences defy all logic. The peti tioners rightly noted that instead of providing solutions, they have, with unmitigated callousness, worsened the problem. It is this readiness to

wreak irrevocable damage on our natural heritage in pursuit of what is expedient that has compelled us to rule at length on this issue. We ignore the unrelenting depletion of our natural heritage at our peril. I. The Reorganization Act of the DENR Defines and Limits Its Powers over the Countrys Natural Resources The respondents next point out that the Marikina Watershed Reservation, and thus the San Mateo Site, is located in the public domain. They allege that as such, neither the Province of Rizal nor the municipality of San Mateo has the power to control or regulate its use since properties of this nature belong to the national, and not to the local governments. It is ironic that the respondents should pursue this line of reasoning. 41 In Cruz v. Secretary of Environment and Natural Resources , we had occasion to observe that "(o)ne of the fixed and dominating objectives of the 1935 Constitutional Convention was the nationalization and conservation of the natural resources of the country. There was an overwhelming sentiment in the convention in favor of the principle of state ownership of natural resources and the adoption of the Regalian doctrine. State ownership of natural resources was seen as a necessary starting point to secure recognition of the states power to cont rol their disposition, exploitation, 42 development, or utilization." The Regalian doctrine was embodied in the 1935 Constitution, in Section 1 of Article XIII on "Conservation and Utilization of Natural Resources." This was reiterated in the 1973 Constitution under Article XIV on the "National Economy and the Patrimony of the Nation," and reaffirmed in the 1987 Constitution in Section 2 of Article XII on "National Economy and Patrimony," to wit: Sec. 2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned by the State. With the exception of agricultural lands, all other natural resources shall not be alienated. The exploration, development and utilization of natural resources shall be under the full control and supervision of the State. The State may directly undertake such activities or it may enter into co-production, joint venture, or production-sharing agreements with Filipino citizens, or corporations or associations at least sixty per centum of whose capital is owned by such citizens. Such agreements may be for a period not exceeding twenty-five years, renewable for not more than twenty-five years, and under such terms and conditions as may be provided by law. In cases of water rights for irrigation, water supply, fisheries, 43 or industrial uses other than the development of water power, beneficial use may be the measure and limit of the grant. Clearly, the state is, and always has been, zealous in preserving as much of our natural and national heritage as it can, enshrining as it did the obligation to preserve and protect the same within the text of our fundamental law. It was with this objective in mind that the respondent DENR was mandated by then President Corazon C. Aquino, under 44 Section 4 of Executive Order No. 192, otherwise known as "The Reorganization Act of the Department of Environment and Natural Resources," to be "the primary government agency responsible for the conservation, management, development and proper use of the countrys environment and natural resources, specifically forest and grazing lands, mineral resources, including those in reservation and watershed areas, and lands of the public domain. It is also responsible for the licensing and regulation of all natural resources as may be provided for by law in order to ensure equitable sharing of the benefits derived therefrom for the welfare of the present and future generations of Filipinos." 45 We expounded on this matter in the landmark case of Oposa v. Factoran, where we held that the right to a balanced and healthful ecology is a fundamental legal right that carries with it the correlative duty to refrain from impairing the environment. This right implies, among other things, the judicious management and conservation of the countrys resources, which duty is reposed in the DENR under the aforequoted Section 4 of Executive Order No. 192. Moreover: Section 3 (of E. O. No. 192) makes the following statement of policy: SEC. 3. Declaration of Policy. - It is hereby declared the policy of the State to ensure the sustainable use, development, management, renewal, and conservation of the country's forest, mineral, land, off-shore areas and other natural resources, including the protection and enhancement of the quality of the environment, and equitable access of the different segments of the population to the development and use of the country's natural resources, not only for the present generation but for future generations as well. It is also the policy of the state to recognize and apply a true value system including social and environmental cost implications relative to their utilization; development and conservation of our natural resources. (Emphasis ours) This policy declaration is substantially re-stated in Title XIV, Book IV of the Administrative Code of 1987, specifically in Section 1 thereof which reads: SEC. 1. Declaration of Policy. - (1) The State shall ensure, for the benefit of the Filipino people, the full exploration and development as well as the judicious disposition, utilization, management, renewal and conservation of the country's forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other natural resources,consistent with the necessity of maintaining a sound ecological balance and protecting and enhancing the quality of the environment and the objective of making the exploration, development and utilization of such natural resources equitably accessible to the different segments of the present as well as future generations. (2) The State shall likewise recognize and apply a true value system that takes into account social and environmental cost implications relative to the utilization, development and conservation of our natural resources. The above provision stresses "the necessity of maintaining a sound ecological balance and protecting and enhancing the 46 quality of the environment." (Emphasis ours.)

In sum, the Administrative Code of 1987 and Executive Order No. 192 entrust the DENR with the guardianship andsafekeeping of the Marikina Watershed Reservation and our other natural treasures. However, although the DENR, an agency of the government, owns the Marikina Reserve and has jurisdiction over the same, this power is not absolute, but is defined by the declared policies of the state, and is subject to the law and higher authority.Section 2, Title XIV, Book IV of the Administrative Code of 1987, while specifically referring to the mandate of the DENR, makes particular reference to the agencys being subject to law and higher authority, thus: SEC. 2. Mandate. - (1) The Department of Environment and Natural Resources shall be primarily responsible for the implementation of the foregoing policy. (2) It shall, subject to law and higher authority, be in charge of carrying out the State's constitutional mandate to control and supervise the exploration, development, utilization, and conservation of the country's natural resources. With great power comes great responsibility. It is the height of irony that the public respondents have vigorously arrogated to themselves the power to control the San Mateo site, but have deftly ignored their corresponding responsibility as guardians and protectors of this tormented piece of land. II. The Local Government Code Gives to Local Government Units All the Necessary Powers to Promote the General Welfare of Their Inhabitants The circumstances under which Proclamation No. 635 was passed also violates Rep. Act No. 7160, or the Local Government Code. Contrary to the averment of the respondents, Proclamation No. 635, which was passed on 28 August 1995, is subject to the provisions of the Local Government Code, which was approved four years earlier, on 10 October 1991. Section 2(c) of the said law declares that it is the policy of the state " to require all national agencies and offices to conduct periodic consultations with appropriate local government units, non-governmental and people's organizations, and other concerned sectors of the community before any project or program is implemented in their respective jurisdictions." Likewise, Section 27 requires prior consultations before a program shall be implemented by government authorities and the prior approval of the sanggunian is obtained. During the oral arguments at the hearing for the temporary restraining order, Director Uranza of the MMDA Solid Waste Management Task Force declared before the Court of Appeals that they had conducted the required consultations. However, he added that "(t)his is the problem, sir, the officials we may have been talking with at the time this was established may no longer be incumbent and this is our difficulty now. That is what we are trying to do now, a continuing 47 dialogue." The ambivalent reply of Director Uranza was brought to the fore when, at the height of the protest rally and barricade along Marcos Highway to stop dump trucks from reaching the site, all the municipal mayors of the province of Rizal openly declared their full support for the rally and notified the MMDA that they would oppose any further attempt to dump 48 garbage in their province. The municipal mayors acted within the scope of their powers, and were in fact fulfilling their mandate, when they did this. Section 16 allows every local government unit to "exercise the powers expressly granted, those necessarily implied therefrom, as well as powers necessary, appropriate, or incidental for its efficient and effective governance, and those which are essential to the promotion of the general welfare," which involve, among other things, " promot(ing) health and safety, enhance(ing) the right of the people to a balanced ecology, and preserv(ing) the comfort and convenience of their inhabitants. " 49 In Lina , Jr. v. Pao, we held that Section 2 (c), requiring consultations with the appropriate local government units, should apply to national government projects affecting the environmental or ecological balance of the particular community implementing the project. Rejecting the petitioners contention that Sect ions 2(c) and 27 of the Local Government Code applied mandatorily in the setting up of lotto outlets around the country, we held that: From a careful reading of said provisions, we find that these apply only to national programs and/or projects which are to be implemented in a particular local community. Lotto is neither a program nor a project of the national government, but of a charitable institution, the PCSO. Though sanctioned by the national government, it is far fetched to say that lotto falls within the contemplation of Sections 2 (c) and 27 of the Local Government Code. Section 27 of the Code should be read in conjunction with Section 26 thereof. Section 26 reads: SECTION 26. Duty of National Government Agencies in the Maintenance of Ecological Balance. It shall be the duty of every national agency or government-owned or controlled corporation authorizing or involved in the planning and implementation of any project or program that may cause pollution, climatic change, depletion of non-renewable resources, loss of crop land, range-land, or forest cover, and extinction of animal or plant species, to consult with the local government units, nongovernmental organizations, and other sectors concerned and explain the goals and objectives of the project or program, its impact upon the people and the community in terms of environmental or ecological balance, and the measures that will be undertaken to prevent or minimize the adverse effects thereof. Thus, the projects and programs mentioned in Section 27 should be interpreted to mean projects and programs whose effects are among those enumerated in Section 26 and 27, to wit, those that: (1) may cause pollution; (2) may bring about climatic change; (3) may cause the depletion of non-renewable resources; (4) may result in loss of crop land, range-land, or forest cover; (5) may eradicate certain animal or plant species from the face of the planet; and (6) other projects or programs that may call for the eviction of a particular group of people residing in

the locality where these will be implemented. Obviously, none of these effects will be produced by the introduction of lotto in the province of Laguna. (emphasis supplied) 50 We reiterated this doctrine in the recent case of Bangus Fry Fisherfolk v. Lanzanas, where we held that there was no statutory requirement for the sangguniang bayan of Puerto Galera to approve the construction of a mooring facility, as Sections 26 and 27 are inapplicable to projects which are not environmentally critical. Moreover, Section 447, which enumerates the powers, duties and functions of the municipality, grants the sangguniang bayan the power to, among other things, "enact ordinances, approve resolutions and appropriate funds for the general welfare of the municipality and its inhabitants pursuant to Section 16 of th(e) Code." These include: (1) Approving ordinances and passing resolutions to protect the environment and impose appropriate penalties for acts which endanger the environment, such as dynamite fishing and other forms of destructive fishing, illegal logging and smuggling of logs, smuggling of natural resources products and of endangered species of flora and fauna, slash and burn farming, and such other activities which result in pollution, acceleration of eutrophication of rivers and lakes, or of ecological imbalance; [Section 447 (1)(vi)] (2) Prescribing reasonable limits and restraints on the use of property within the jurisdiction of the municipality, adopting a comprehensive land use plan for the municipality, reclassifying land within the jurisdiction of the city, subject to the pertinent provisions of this Code, enacting integrated zoning ordinances in consonance with the approved comprehensive land use plan, subject to existing laws, rules and regulations; establishing fire limits or zones, particularly in populous centers; and regulating the construction, repair or modification of buildings within said fire limits or zones in accordance with the provisions of this Code; [Section 447 (2)(vi-ix)] (3) Approving ordinances which shall ensure the efficient and effective delivery of the basic services and facilities as provided for under Section 17 of this Code, and in addition to said services and facilities, providing for the establishment, maintenance, protection, and conservation of communal forests and watersheds, tree parks, greenbelts, mangroves, and other similar forest development projects .and, subject to existing laws, establishing and providing for the maintenance, repair and operation of an efficient waterworks system to supply water for the inhabitants and purifying the source of the water supply; regulating the construction, maintenance, repair and use of hydrants, pumps, cisterns and reservoirs; protecting the purity and quantity of the water supply of the municipality and, for this purpose, extending the coverage of appropriate ordinances over all territory within the drainage area of said water supply and within one hundred (100) meters of the reservoir, conduit, canal, aqueduct, pumping station, or watershed used in connection with the water service; and regulating the consumption, use or wastage of water." [Section 447 (5)(i) & (vii)] Under the Local Government Code, therefore, two requisites must be met before a national project that affects the environmental and ecological balance of local communities can be implemented: prior consultation with the affected local communities, and prior approval of the project by the appropriate sanggunian. Absent either of these mandatory requirements, the projects implementation is illegal. III. Waste Disposal Is Regulated by the Ecological Solid Waste Management Act of 2000 The respondents would have us overlook all the abovecited laws because the San Mateo site is a very expensive - and necessary - fait accompli. The respondents cite the millions of pesos and hundreds of thousands of dollars the government has already expended in its development and construction, and the lack of any viable alternative sites. The Court of Appeals agreed, thus: During the hearing on the injunction, questions were also asked. "What will happen if the San Mateo Sanitary Landfill is closed? Where will the daily collections of garbage be disposed of and dumped?" Atty. Mendoza, one of the lawyers of the petitioners, answered that each city/municipality must take care of its own. Reflecting on that answer, we are troubled: will not the proliferation of separate open dumpsites be a more serious health hazard (which ha(s) to be addressed) to the residents of the community? What with the galloping population growth and the constricting available land area in Metro Manila? There could be a mini-Smokey Mountain in each of the ten citiescomprising Metro Manila, placing in danger the health and safety of more people. Damage to the environment could be aggravated by the increase in number of open dumpsites. An integrated system of solid waste management, like the San Mateo Sanitary Landfill, appears advisable to a 51 populous metropolis like the Greater Metro Manila Area absent access to better technology. We acknowledge that these are valid concerns. Nevertheless, the lower court should have been mindful of the legal truism that it is the legislature, by its very nature, which is the primary judge of the necessity, adequacy, wisdom, 52 reasonableness and expediency of any law. Moreover, these concerns are addressed by Rep. Act No. 9003. Approved on 26 January 2001, "The Ecological Solid Waste Management Act of 2000" was enacted pursuant to the declared policy of the state "to adopt a systematic, comprehensive and ecological solid waste management system which shall ensure the protection of public health and environment, and utilize environmentally sound methods that maximize the utilization of valuable resources and 53 encourage resource conservation and recovery." It requires the adherence to a Local Government Solid Waste Management Plan with regard to the collection and transfer, processing, source reduction, recycling, composting and final disposal of solid wastes, the handling and disposal of special wastes, education and public information, and the funding of solid waste management projects.

The said law mandates the formulation of a National Solid Waste Management Framework, which should include, among other things, the method and procedure for the phaseout and the eventual closure within eighteen months from effectivity of the Act in case of existing open dumps and/or sanitary landfills located within an aquifer, groundwater reservoir or 54 watershed area. Any landfills subsequently developed must comply with the minimum requirements laid down in Section 40, specifically that the site selected must be consistent with the overall land use plan of the local government unit, and that the site must be located in an area where the landfills operation will not detrimentally 55 affect environmentally sensitive resources such as aquifers, groundwater reservoirs or watershed areas. This writes finis to any remaining aspirations respondents may have of reopening the San Mateo Site. Having declared Proclamation No. 635 illegal, we see no compelling need to tackle the remaining issues raised in the petition and the parties respective memoranda. A final word. Laws pertaining to the protection of the environment were not drafted in a vacuum. Congress passed these laws fully aware of the perilous state of both our economic and natural wealth. It was precisely to minimize the adverse impact humanitys actions on all aspects of the natural world, at the same time maintaining and ensuring an environment under which man and nature can thrive in productive and enjoyable harmony with each other, that these legal safeguards were put in place. They should thus not be so lightly cast aside in the face of what is easy and expedient. WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R. SP No. 41330, dated 13 June 1997, is REVERSED and SET ASIDE. The temporary restraining order issued by the Court on 24 January 2001 is hereby made permanent. SO ORDERED. Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. 101083 July 30, 1993 JUAN ANTONIO, ANNA ROSARIO and JOSE ALFONSO, all surnamed OPOSA, minors, and represented by their parents ANTONIO and RIZALINA OPOSA, ROBERTA NICOLE SADIUA, minor, represented by her parents CALVIN and ROBERTA SADIUA, CARLO, AMANDA SALUD and PATRISHA, all surnamed FLORES, minors and represented by their parents ENRICO and NIDA FLORES, GIANINA DITA R. FORTUN, minor, represented by her parents SIGRID and DOLORES FORTUN, GEORGE II and MA. CONCEPCION, all surnamed MISA, minors and represented by their parents GEORGE and MYRA MISA, BENJAMIN ALAN V. PESIGAN, minor, represented by his parents ANTONIO and ALICE PESIGAN, JOVIE MARIE ALFARO, minor, represented by her parents JOSE and MARIA VIOLETA ALFARO, MARIA CONCEPCION T. CASTRO, minor, represented by her parents FREDENIL and JANE CASTRO, JOHANNA DESAMPARADO, minor, represented by her parents JOSE and ANGELA DESAMPRADO, CARLO JOAQUIN T. NARVASA, minor, represented by his parents GREGORIO II and CRISTINE CHARITY NARVASA, MA. MARGARITA, JESUS IGNACIO, MA. ANGELA and MARIE GABRIELLE, all surnamed SAENZ, minors, represented by their parents ROBERTO and AURORA SAENZ, KRISTINE, MARY ELLEN, MAY, GOLDA MARTHE and DAVID IAN, all surnamed KING, minors, represented by their parents MARIO and HAYDEE KING, DAVID, FRANCISCO and THERESE VICTORIA, all surnamed ENDRIGA, minors, represented by their parents BALTAZAR and TERESITA ENDRIGA, JOSE MA. and REGINA MA., all surnamed ABAYA, minors, represented by their parents ANTONIO and MARICA ABAYA, MARILIN, MARIO, JR. and MARIETTE, all surnamed CARDAMA, minors, represented by their parents MARIO and LINA CARDAMA, CLARISSA, ANN MARIE, NAGEL, and IMEE LYN, all surnamed OPOSA, minors and represented by their parents RICARDO and MARISSA OPOSA, PHILIP JOSEPH, STEPHEN JOHN and ISAIAH JAMES, all surnamed QUIPIT, minors, represented by their parents JOSE MAX and VILMI QUIPIT, BUGHAW CIELO, CRISANTO, ANNA, DANIEL and FRANCISCO, all surnamed BIBAL, minors, represented by their parents FRANCISCO, JR. and MILAGROS BIBAL, and THE PHILIPPINE ECOLOGICAL NETWORK, INC., petitioners, vs. THE HONORABLE FULGENCIO S. FACTORAN, JR., in his capacity as the Secretary of the Department of Environment and Natural Resources, and THE HONORABLE ERIBERTO U. ROSARIO, Presiding Judge of the RTC, Makati, Branch 66, respondents. Oposa Law Office for petitioners. The Solicitor General for respondents. DAVIDE, JR., J.: In a broader sense, this petition bears upon the right of Filipinos to a balanced and healthful ecology which the petitioners dramatically associate with the twin concepts of "inter-generational responsibility" and "inter-generational justice." Specifically, it touches on the issue of whether the said petitioners have a cause of action to "prevent the misappropriation or impairment" of Philippine rainforests and "arrest the unabated hemorrhage of the country's vital life support systems and continued rape of Mother Earth." The controversy has its genesis in Civil Case No. 90-77 which was filed before Branch 66 (Makati, Metro Manila) of the Regional Trial Court (RTC), National Capital Judicial Region. The principal plaintiffs therein, now the principal petitioners,

are all minors duly represented and joined by their respective parents. Impleaded as an additional plaintiff is the Philippine Ecological Network, Inc. (PENI), a domestic, non-stock and non-profit corporation organized for the purpose of, inter alia, engaging in concerted action geared for the protection of our environment and natural resources. The original defendant was the Honorable Fulgencio S. Factoran, Jr., then Secretary of the Department of Environment and Natural Resources (DENR). His substitution in this petition by the new Secretary, the Honorable Angel C. Alcala, was subsequently ordered 1 2 3 upon proper motion by the petitioners. The complaint was instituted as a taxpayers' class suit and alleges that the plaintiffs "are all citizens of the Republic of the Philippines, taxpayers, and entitled to the full benefit, use and enjoyment of the natural resource treasure that is the country's virgin tropical forests." The same was filed for themselves and others who are equally concerned about the preservation of said resource but are "so numerous that it is impracticable to bring them all before the Court." The minors further asseverate that they "represent their generation as well as generations yet 4 unborn." Consequently, it is prayed for that judgment be rendered: . . . ordering defendant, his agents, representatives and other persons acting in his behalf to (1) Cancel all existing timber license agreements in the country; (2) Cease and desist from receiving, accepting, processing, renewing or approving new timber license agreements. 5 and granting the plaintiffs ". . . such other reliefs just and equitable under the premises." The complaint starts off with the general averments that the Philippine archipelago of 7,100 islands has a land area of thirty million (30,000,000) hectares and is endowed with rich, lush and verdant rainforests in which varied, rare and unique species of flora and fauna may be found; these rainforests contain a genetic, biological and chemical pool which is irreplaceable; they are also the habitat of indigenous Philippine cultures which have existed, endured and flourished since time immemorial; scientific evidence reveals that in order to maintain a balanced and healthful ecology, the country's land area should be utilized on the basis of a ratio of fifty-four per cent (54%) for forest cover and forty-six per cent (46%) for agricultural, residential, industrial, commercial and other uses; the distortion and disturbance of this balance as a consequence of deforestation have resulted in a host of environmental tragedies, such as (a) water shortages resulting from drying up of the water table, otherwise known as the "aquifer," as well as of rivers, brooks and streams, (b) salinization of the water table as a result of the intrusion therein of salt water, incontrovertible examples of which may be found in the island of Cebu and the Municipality of Bacoor, Cavite, (c) massive erosion and the consequential loss of soil fertility and agricultural productivity, with the volume of soil eroded estimated at one billion (1,000,000,000) cubic meters per annum approximately the size of the entire island of Catanduanes, (d) the endangering and extinction of the country's unique, rare and varied flora and fauna, (e) the disturbance and dislocation of cultural communities, including the disappearance of the Filipino's indigenous cultures, (f) the siltation of rivers and seabeds and consequential destruction of corals and other aquatic life leading to a critical reduction in marine resource productivity, (g) recurrent spells of drought as is presently experienced by the entire country, (h) increasing velocity of typhoon winds which result from the absence of windbreakers, (i) the floodings of lowlands and agricultural plains arising from the absence of the absorbent mechanism of forests, (j) the siltation and shortening of the lifespan of multi-billion peso dams constructed and operated for the purpose of supplying water for domestic uses, irrigation and the generation of electric power, and (k) the reduction of the earth's capacity to process carbon dioxide gases which has led to perplexing and catastrophic climatic changes such as the phenomenon of global warming, otherwise known as the "greenhouse effect." Plaintiffs further assert that the adverse and detrimental consequences of continued and deforestation are so capable of unquestionable demonstration that the same may be submitted as a matter of judicial notice. This notwithstanding, they expressed their intention to present expert witnesses as well as documentary, photographic and film evidence in the course of the trial. As their cause of action, they specifically allege that: CAUSE OF ACTION 7. Plaintiffs replead by reference the foregoing allegations. 8. Twenty-five (25) years ago, the Philippines had some sixteen (16) million hectares of rainforests constituting roughly 53% of the country's land mass. 9. Satellite images taken in 1987 reveal that there remained no more than 1.2 million hectares of said rainforests or four per cent (4.0%) of the country's land area. 10. More recent surveys reveal that a mere 850,000 hectares of virgin old-growth rainforests are left, barely 2.8% of the entire land mass of the Philippine archipelago and about 3.0 million hectares of immature and uneconomical secondary growth forests. 11. Public records reveal that the defendant's, predecessors have granted timber license agreements ('TLA's') to various corporations to cut the aggregate area of 3.89 million hectares for commercial logging purposes. A copy of the TLA holders and the corresponding areas covered is hereto attached as Annex "A". 12. At the present rate of deforestation, i.e. about 200,000 hectares per annum or 25 hectares per hour nighttime, Saturdays, Sundays and holidays included the Philippines will be bereft of forest resources after the end of this ensuing decade, if not earlier. 13. The adverse effects, disastrous consequences, serious injury and irreparable damage of this continued trend of deforestation to the plaintiff minor's generation and to generations yet unborn are

evident and incontrovertible. As a matter of fact, the environmental damages enumerated in paragraph 6 hereof are already being felt, experienced and suffered by the generation of plaintiff adults. 14. The continued allowance by defendant of TLA holders to cut and deforest the remaining forest stands will work great damage and irreparable injury to plaintiffs especially plaintiff minors and their successors who may never see, use, benefit from and enjoy this rare and unique natural resource treasure. This act of defendant constitutes a misappropriation and/or impairment of the natural resource property he holds in trust for the benefit of plaintiff minors and succeeding generations. 15. Plaintiffs have a clear and constitutional right to a balanced and healthful ecology and are entitled to protection by the State in its capacity as the parens patriae. 16. Plaintiff have exhausted all administrative remedies with the defendant's office. On March 2, 1990, plaintiffs served upon defendant a final demand to cancel all logging permits in the country. A copy of the plaintiffs' letter dated March 1, 1990 is hereto attached as Annex "B". 17. Defendant, however, fails and refuses to cancel the existing TLA's to the continuing serious damage and extreme prejudice of plaintiffs. 18. The continued failure and refusal by defendant to cancel the TLA's is an act violative of the rights of plaintiffs, especially plaintiff minors who may be left with a country that is desertified (sic), bare, barren and devoid of the wonderful flora, fauna and indigenous cultures which the Philippines had been abundantly blessed with. 19. Defendant's refusal to cancel the aforementioned TLA's is manifestly contrary to the public policy enunciated in the Philippine Environmental Policy which, in pertinent part, states that it is the policy of the State (a) to create, develop, maintain and improve conditions under which man and nature can thrive in productive and enjoyable harmony with each other; (b) to fulfill the social, economic and other requirements of present and future generations of Filipinos and; (c) to ensure the attainment of an environmental quality that is conductive to a life of dignity and wellbeing. (P.D. 1151, 6 June 1977) 20. Furthermore, defendant's continued refusal to cancel the aforementioned TLA's is contradictory to the Constitutional policy of the State to a. effect "a more equitable distribution of opportunities, income and wealth" and "make full and efficient use of natural resources (sic)." (Section 1, Article XII of the Constitution); b. "protect the nation's marine wealth." (Section 2, ibid); c. "conserve and promote the nation's cultural heritage and resources (sic)" (Section 14, Article XIV,id.); d. "protect and advance the right of the people to a balanced and healthful ecology in accord with the rhythm and harmony of nature." (Section 16, Article II, id.) 21. Finally, defendant's act is contrary to the highest law of humankind the natural law and violative of plaintiffs' right to self-preservation and perpetuation. 22. There is no other plain, speedy and adequate remedy in law other than the instant action to arrest the 6 unabated hemorrhage of the country's vital life support systems and continued rape of Mother Earth. On 22 June 1990, the original defendant, Secretary Factoran, Jr., filed a Motion to Dismiss the complaint based on two (2) grounds, namely: (1) the plaintiffs have no cause of action against him and (2) the issue raised by the plaintiffs is a political question which properly pertains to the legislative or executive branches of Government. In their 12 July 1990 Opposition to the Motion, the petitioners maintain that (1) the complaint shows a clear and unmistakable cause of action, (2) the motion is dilatory and (3) the action presents a justiciable question as it involves the defendant's abuse of discretion. 7 On 18 July 1991, respondent Judge issued an order granting the aforementioned motion to dismiss. In the said order, not only was the defendant's claim that the complaint states no cause of action against him and that it raises a political question sustained, the respondent Judge further ruled that the granting of the relief prayed for would result in the impairment of contracts which is prohibited by the fundamental law of the land. Plaintiffs thus filed the instant special civil action for certiorari under Rule 65 of the Revised Rules of Court and ask this Court to rescind and set aside the dismissal order on the ground that the respondent Judge gravely abused his discretion in dismissing the action. Again, the parents of the plaintiffs-minors not only represent their children, but have also joined 8 the latter in this case. On 14 May 1992, We resolved to give due course to the petition and required the parties to submit their respective Memoranda after the Office of the Solicitor General (OSG) filed a Comment in behalf of the respondents and the petitioners filed a reply thereto. Petitioners contend that the complaint clearly and unmistakably states a cause of action as it contains sufficient allegations concerning their right to a sound environment based on Articles 19, 20 and 21 of the Civil Code (Human Relations), Section 4 of Executive Order (E.O.) No. 192 creating the DENR, Section 3 of Presidential Decree (P.D.) No. 1151 (Philippine Environmental Policy), Section 16, Article II of the 1987 Constitution recognizing the right of the people to a balanced and healthful ecology, the concept of generational genocide in Criminal Law and the concept of man's

inalienable right to self-preservation and self-perpetuation embodied in natural law. Petitioners likewise rely on the respondent's correlative obligation per Section 4 of E.O. No. 192, to safeguard the people's right to a healthful environment. It is further claimed that the issue of the respondent Secretary's alleged grave abuse of discretion in granting Timber License Agreements (TLAs) to cover more areas for logging than what is available involves a judicial question. Anent the invocation by the respondent Judge of the Constitution's non-impairment clause, petitioners maintain that the same does not apply in this case because TLAs are not contracts. They likewise submit that even if TLAs may be considered protected by the said clause, it is well settled that they may still be revoked by the State when the public interest so requires. On the other hand, the respondents aver that the petitioners failed to allege in their complaint a specific legal right violated by the respondent Secretary for which any relief is provided by law. They see nothing in the complaint but vague and nebulous allegations concerning an "environmental right" which supposedly entitles the petitioners to the "protection by the state in its capacity as parens patriae." Such allegations, according to them, do not reveal a valid cause of action. They then reiterate the theory that the question of whether logging should be permitted in the country is a political question which should be properly addressed to the executive or legislative branches of Government. They therefore assert that the petitioners' resources is not to file an action to court, but to lobby before Congress for the passage of a bill that would ban logging totally. As to the matter of the cancellation of the TLAs, respondents submit that the same cannot be done by the State without due process of law. Once issued, a TLA remains effective for a certain period of time usually for twenty-five (25) years. During its effectivity, the same can neither be revised nor cancelled unless the holder has been found, after due notice and hearing, to have violated the terms of the agreement or other forestry laws and regulations. Petitioners' proposition to have all the TLAs indiscriminately cancelled without the requisite hearing would be violative of the requirements of due process. Before going any further, We must first focus on some procedural matters. Petitioners instituted Civil Case No. 90-777 as a class suit. The original defendant and the present respondents did not take issue with this matter. Nevertheless, We hereby rule that the said civil case is indeed a class suit. The subject matter of the complaint is of common and general interest not just to several, but to all citizens of the Philippines. Consequently, since the parties are so numerous, it, becomes impracticable, if not totally impossible, to bring all of them before the court. We likewise declare that the plaintiffs therein are numerous and representative enough to ensure the full protection of all concerned interests. Hence, all the requisites for the filing of a valid class suit under Section 12, Rule 3 of the Revised Rules of Court are present both in the said civil case and in the instant petition, the latter being but an incident to the former. This case, however, has a special and novel element. Petitioners minors assert that they represent their generation as well as generations yet unborn. We find no difficulty in ruling that they can, for themselves, for others of their generation and for the succeeding generations, file a class suit. Their personality to sue in behalf of the succeeding generations can only be based on the concept of intergenerational responsibility insofar as the right to a balanced and healthful ecology is concerned. Such a right, as hereinafter expounded, considers 9 the "rhythm and harmony of nature." Nature means the created world in its entirety. Such rhythm and harmony indispensably include, inter alia, the judicious disposition, utilization, management, renewal and conservation of the country's forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other natural resources to the end that their 10 exploration, development and utilization be equitably accessible to the present as well as future generations. Needless to say, every generation has a responsibility to the next to preserve that rhythm and harmony for the full enjoyment of a balanced and healthful ecology. Put a little differently, the minors' assertion of their right to a sound environment constitutes, at the same time, the performance of their obligation to ensure the protection of that right for the generations to come. The locus standi of the petitioners having thus been addressed, We shall now proceed to the merits of the petition. After a careful perusal of the complaint in question and a meticulous consideration and evaluation of the issues raised and arguments adduced by the parties, We do not hesitate to find for the petitioners and rule against the respondent Judge's challenged order for having been issued with grave abuse of discretion amounting to lack of jurisdiction. The pertinent portions of the said order reads as follows: xxx xxx xxx After a careful and circumspect evaluation of the Complaint, the Court cannot help but agree with the defendant. For although we believe that plaintiffs have but the noblest of all intentions, it ( sic) fell short of alleging, with sufficient definiteness, a specific legal right they are seeking to enforce and protect, or a specific legal wrong they are seeking to prevent and redress (Sec. 1, Rule 2, RRC). Furthermore, the Court notes that the Complaint is replete with vague assumptions and vague conclusions based on unverified data. In fine, plaintiffs fail to state a cause of action in its Complaint against the herein defendant. Furthermore, the Court firmly believes that the matter before it, being impressed with political color and involving a matter of public policy, may not be taken cognizance of by this Court without doing violence to the sacred principle of "Separation of Powers" of the three (3) co-equal branches of the Government. The Court is likewise of the impression that it cannot, no matter how we stretch our jurisdiction, grant the reliefs prayed for by the plaintiffs, i.e., to cancel all existing timber license agreements in the country and

to cease and desist from receiving, accepting, processing, renewing or approving new timber license agreements. For to do otherwise would amount to "impairment of contracts" abhored (sic) by the 11 fundamental law. We do not agree with the trial court's conclusions that the plaintiffs failed to allege with sufficient definiteness a specific legal right involved or a specific legal wrong committed, and that the complaint is replete with vague assumptions and conclusions based on unverified data. A reading of the complaint itself belies these conclusions. The complaint focuses on one specific fundamental legal right the right to a balanced and healthful ecology which, for the first time in our nation's constitutional history, is solemnly incorporated in the fundamental law. Section 16, Article II of the 1987 Constitution explicitly provides: Sec. 16. The State shall protect and advance the right of the people to a balanced and healthful ecology in accord with the rhythm and harmony of nature. This right unites with the right to health which is provided for in the preceding section of the same article: Sec. 15. The State shall protect and promote the right to health of the people and instill health consciousness among them. While the right to a balanced and healthful ecology is to be found under the Declaration of Principles and State Policies and not under the Bill of Rights, it does not follow that it is less important than any of the civil and political rights enumerated in the latter. Such a right belongs to a different category of rights altogether for it concerns nothing less than self-preservation and self-perpetuation aptly and fittingly stressed by the petitioners the advancement of which may even be said to predate all governments and constitutions. As a matter of fact, these basic rights need not even be written in the Constitution for they are assumed to exist from the inception of humankind. If they are now explicitly mentioned in the fundamental charter, it is because of the well-founded fear of its framers that unless the rights to a balanced and healthful ecology and to health are mandated as state policies by the Constitution itself, thereby highlighting their continuing importance and imposing upon the state a solemn obligation to preserve the first and protect and advance the second, the day would not be too far when all else would be lost not only for the present generation, but also for those to come generations which stand to inherit nothing but parched earth incapable of sustaining life. The right to a balanced and healthful ecology carries with it the correlative duty to refrain from impairing the environment. During the debates on this right in one of the plenary sessions of the 1986 Constitutional Commission, the following exchange transpired between Commissioner Wilfrido Villacorta and Commissioner Adolfo Azcuna who sponsored the section in question: MR. VILLACORTA: Does this section mandate the State to provide sanctions against all forms of pollution air, water and noise pollution? MR. AZCUNA: Yes, Madam President. The right to healthful (sic) environment necessarily carries with it the correlative duty of not impairing the same and, therefore, sanctions may be provided 12 for impairment of environmental balance. The said right implies, among many other things, the judicious management and conservation of the country's forests. Without such forests, the ecological or environmental balance would be irreversiby disrupted. Conformably with the enunciated right to a balanced and healthful ecology and the right to health, as well as the other related provisions of the Constitution concerning the conservation, development and utilization of the country's natural 13 14 resources, then President Corazon C. Aquino promulgated on 10 June 1987 E.O. No. 192, Section 4 of which expressly mandates that the Department of Environment and Natural Resources "shall be the primary government agency responsible for the conservation, management, development and proper use of the country's environment and natural resources, specifically forest and grazing lands, mineral, resources, including those in reservation and watershed areas, and lands of the public domain, as well as the licensing and regulation of all natural resources as may be provided for by law in order to ensure equitable sharing of the benefits derived therefrom for the welfare of the present and future generations of Filipinos." Section 3 thereof makes the following statement of policy: Sec. 3. Declaration of Policy. It is hereby declared the policy of the State to ensure the sustainable use, development, management, renewal, and conservation of the country's forest, mineral, land, offshore areas and other natural resources, including the protection and enhancement of the quality of the environment, and equitable access of the different segments of the population to the development and the use of the country's natural resources, not only for the present generation but for future generations as well. It is also the policy of the state to recognize and apply a true value system including social and environmental cost implications relative to their utilization, development and conservation of our natural resources. 15 This policy declaration is substantially re-stated it Title XIV, Book IV of the Administrative Code of 1987, specifically in Section 1 thereof which reads: Sec. 1. Declaration of Policy. (1) The State shall ensure, for the benefit of the Filipino people, the full exploration and development as well as the judicious disposition, utilization, management, renewal and conservation of the country's forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other natural resources, consistent with the necessity of maintaining a sound ecological balance and protecting and enhancing the quality of the environment and the objective of making the exploration, development

and utilization of such natural resources equitably accessible to the different segments of the present as well as future generations. (2) The State shall likewise recognize and apply a true value system that takes into account social and environmental cost implications relative to the utilization, development and conservation of our natural resources. The above provision stresses "the necessity of maintaining a sound ecological balance and protecting and enhancing the quality of the environment." Section 2 of the same Title, on the other hand, specifically speaks of the mandate of the DENR; however, it makes particular reference to the fact of the agency's being subject to law and higher authority. Said section provides: Sec. 2. Mandate. (1) The Department of Environment and Natural Resources shall be primarily responsible for the implementation of the foregoing policy. (2) It shall, subject to law and higher authority, be in charge of carrying out the State's constitutional mandate to control and supervise the exploration, development, utilization, and conservation of the country's natural resources. Both E.O. NO. 192 and the Administrative Code of 1987 have set the objectives which will serve as the bases for policy formulation, and have defined the powers and functions of the DENR. It may, however, be recalled that even before the ratification of the 1987 Constitution, specific statutes already paid special attention to the "environmental right" of the present and future generations. On 6 June 1977, P.D. No. 1151 (Philippine Environmental Policy) and P.D. No. 1152 (Philippine Environment Code) were issued. The former "declared a continuing policy of the State (a) to create, develop, maintain and improve conditions under which man and nature can thrive in productive and enjoyable harmony with each other, (b) to fulfill the social, economic and other requirements of present and future generations of Filipinos, and (c) to insure the attainment of an environmental quality that is conducive 16 to a life of dignity and well-being." As its goal, it speaks of the "responsibilities of each generation as trustee and 17 guardian of the environment for succeeding generations." The latter statute, on the other hand, gave flesh to the said policy. Thus, the right of the petitioners (and all those they represent) to a balanced and healthful ecology is as clear as the DENR's duty under its mandate and by virtue of its powers and functions under E.O. No. 192 and the Administrative Code of 1987 to protect and advance the said right. A denial or violation of that right by the other who has the corelative duty or obligation to respect or protect the same gives rise to a cause of action. Petitioners maintain that the granting of the TLAs, which they claim was done with grave abuse of discretion, violated their right to a balanced and healthful ecology; hence, the full protection thereof requires that no further TLAs should be renewed or granted. A cause of action is defined as: . . . an act or omission of one party in violation of the legal right or rights of the other; and its essential elements are legal right of the plaintiff, correlative obligation of the defendant, and act or omission of the 18 defendant in violation of said legal right. It is settled in this jurisdiction that in a motion to dismiss based on the ground that the complaint fails to state a cause of 19 action, the question submitted to the court for resolution involves the sufficiency of the facts alleged in the complaint itself. No other matter should be considered; furthermore, the truth of falsity of the said allegations is beside the point for the truth thereof is deemed hypothetically admitted. The only issue to be resolved in such a case is: admitting such alleged facts to be true, may the court render a valid judgment in accordance with the prayer in the 20 21 complaint? In Militante vs. Edrosolano, this Court laid down the rule that the judiciary should "exercise the utmost care and circumspection in passing upon a motion to dismiss on the ground of the absence thereof [cause of action] lest, by its failure to manifest a correct appreciation of the facts alleged and deemed hypothetically admitted, what the law grants or recognizes is effectively nullified. If that happens, there is a blot on the legal order. The law itself stands in disrepute." After careful examination of the petitioners' complaint, We find the statements under the introductory affirmative allegations, as well as the specific averments under the sub-heading CAUSE OF ACTION, to be adequate enough to show, prima facie, the claimed violation of their rights. On the basis thereof, they may thus be granted, wholly or partly, the reliefs prayed for. It bears stressing, however, that insofar as the cancellation of the TLAs is concerned, there is the need to implead, as party defendants, the grantees thereof for they are indispensable parties. The foregoing considered, Civil Case No. 90-777 be said to raise a political question. Policy formulation or determination by the executive or legislative branches of Government is not squarely put in issue. What is principally involved is the enforcement of a right vis-a-vis policies already formulated and expressed in legislation. It must, nonetheless, be emphasized that the political question doctrine is no longer, the insurmountable obstacle to the exercise of judicial power or the impenetrable shield that protects executive and legislative actions from judicial inquiry or review. The second paragraph of section 1, Article VIII of the Constitution states that: Judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are legally demandable and enforceable, and to determine whether or not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the Government.

Commenting on this provision in his book, Philippine Political Law, Mr. Justice Isagani A. Cruz, a distinguished member of this Court, says: The first part of the authority represents the traditional concept of judicial power, involving the settlement of conflicting rights as conferred as law. The second part of the authority represents a broadening of judicial power to enable the courts of justice to review what was before forbidden territory, to wit, the discretion of the political departments of the government. As worded, the new provision vests in the judiciary, and particularly the Supreme Court, the power to rule upon even the wisdom of the decisions of the executive and the legislature and to declare their acts invalid for lack or excess of jurisdiction because tainted with grave abuse of discretion. The catch, of course, is the meaning of "grave abuse of discretion," which is a very elastic phrase that can expand or contract according to the disposition of the judiciary. 23 In Daza vs. Singson, Mr. Justice Cruz, now speaking for this Court, noted: In the case now before us, the jurisdictional objection becomes even less tenable and decisive. The reason is that, even if we were to assume that the issue presented before us was political in nature, we would still not be precluded from revolving it under the expanded jurisdiction conferred upon us that now covers, in proper cases, even the political question. Article VII, Section 1, of the Constitution clearly provides: . . . The last ground invoked by the trial court in dismissing the complaint is the non-impairment of contracts clause found in the Constitution. The court a quo declared that: The Court is likewise of the impression that it cannot, no matter how we stretch our jurisdiction, grant the reliefs prayed for by the plaintiffs, i.e., to cancel all existing timber license agreements in the country and to cease and desist from receiving, accepting, processing, renewing or approving new timber license agreements. For to do otherwise would amount to "impairment of contracts" abhored (sic) by the 24 fundamental law. We are not persuaded at all; on the contrary, We are amazed, if not shocked, by such a sweeping pronouncement. In the first place, the respondent Secretary did not, for obvious reasons, even invoke in his motion to dismiss the nonimpairment clause. If he had done so, he would have acted with utmost infidelity to the Government by providing undue and unwarranted benefits and advantages to the timber license holders because he would have forever bound the Government to strictly respect the said licenses according to their terms and conditions regardless of changes in policy and the demands of public interest and welfare. He was aware that as correctly pointed out by the petitioners, into every timber license must be read Section 20 of the Forestry Reform Code (P.D. No. 705) which provides: . . . Provided, That when the national interest so requires, the President may amend, modify, replace or rescind any contract, concession, permit, licenses or any other form of privilege granted herein . . . Needless to say, all licenses may thus be revoked or rescinded by executive action. It is not a contract, property 25 or a property right protested by the due process clause of the Constitution. In Tan vs. Director of Forestry, this Court held: . . . A timber license is an instrument by which the State regulates the utilization and disposition of forest resources to the end that public welfare is promoted. A timber license is not a contract within the purview of the due process clause; it is only a license or privilege, which can be validly withdrawn whenever dictated by public interest or public welfare as in this case. A license is merely a permit or privilege to do what otherwise would be unlawful, and is not a contract between the authority, federal, state, or municipal, granting it and the person to whom it is granted; neither is it property or a property right, nor does it create a vested right; nor is it taxation (37 C.J. 168). Thus, this Court held that the granting of license does not create irrevocable rights, neither is it property or property rights (People vs. Ong Tin, 54 O.G. 7576). 26 We reiterated this pronouncement in Felipe Ysmael, Jr. & Co., Inc. vs. Deputy Executive Secretary : . . . Timber licenses, permits and license agreements are the principal instruments by which the State regulates the utilization and disposition of forest resources to the end that public welfare is promoted. And it can hardly be gainsaid that they merely evidence a privilege granted by the State to qualified entities, and do not vest in the latter a permanent or irrevocable right to the particular concession area and the forest products therein. They may be validly amended, modified, replaced or rescinded by the Chief Executive when national interests so require. Thus, they are not deemed contracts within the purview of the due process of law clause [See Sections 3(ee) and 20 of Pres. Decree No. 705, as amended. Also, Tan v. Director of Forestry, G.R. No. L-24548, October 27, 1983, 125 SCRA 302]. Since timber licenses are not contracts, the non-impairment clause, which reads: 27 Sec. 10. No law impairing, the obligation of contracts shall be passed. cannot be invoked. In the second place, even if it is to be assumed that the same are contracts, the instant case does not involve a law or even an executive issuance declaring the cancellation or modification of existing timber licenses. Hence, the nonimpairment clause cannot as yet be invoked. Nevertheless, granting further that a law has actually been passed mandating cancellations or modifications, the same cannot still be stigmatized as a violation of the non-impairment clause. This is because by its very nature and purpose, such as law could have only been passed in the exercise of the police

22

power of the state for the purpose of advancing the right of the people to a balanced and healthful ecology, promoting their health and enhancing the general welfare. In Abe vs. Foster Wheeler 28 Corp. this Court stated: The freedom of contract, under our system of government, is not meant to be absolute. The same is understood to be subject to reasonable legislative regulation aimed at the promotion of public health, moral, safety and welfare. In other words, the constitutional guaranty of non-impairment of obligations of contract is limited by the exercise of the police power of the State, in the interest of public health, safety, moral and general welfare. 29 The reason for this is emphatically set forth in Nebia vs. New York, quoted in Philippine American Life Insurance Co. vs. 30 Auditor General, to wit: Under our form of government the use of property and the making of contracts are normally matters of private and not of public concern. The general rule is that both shall be free of governmental interference. But neither property rights nor contract rights are absolute; for government cannot exist if the citizen may at will use his property to the detriment of his fellows, or exercise his freedom of contract to work them harm. Equally fundamental with the private right is that of the public to regulate it in the common interest. 31 In short, the non-impairment clause must yield to the police power of the state. Finally, it is difficult to imagine, as the trial court did, how the non-impairment clause could apply with respect to the prayer to enjoin the respondent Secretary from receiving, accepting, processing, renewing or approving new timber licenses for, save in cases of renewal, no contract would have as of yet existed in the other instances. Moreover, with respect to renewal, the holder is not entitled to it as a matter of right. WHEREFORE, being impressed with merit, the instant Petition is hereby GRANTED, and the challenged Order of respondent Judge of 18 July 1991 dismissing Civil Case No. 90-777 is hereby set aside. The petitioners may therefore amend their complaint to implead as defendants the holders or grantees of the questioned timber license agreements. No pronouncement as to costs. SO ORDERED. Republic of the Philippines Supreme Court Manila

EN BANC

BORACAY FOUNDATION, INC., Petitioner,

G.R. No. 196870

Present:

CARPIO, - versus VELASCO, JR., LEONARDO-DE CASTRO, BRION, THE PROVINCE OF AKLAN, REPRESENTED BY GOVERNOR CARLITO S. MARQUEZ, THE PHILIPPINE RECLAMATION AUTHORITY, AND THE DENR-EMB (REGION VI), Respondents. PERALTA, BERSAMIN, DEL CASTILLO, ABAD, VILLARAMA, JR., PEREZ, MENDOZA, SERENO, REYES, and PERLAS-BERNABE, JJ.
*

Promulgated:

June 26, 2012 x--------------------------------------------------x

DECISION

LEONARDO-DE CASTRO, J.:

In resolving this controversy, the Court took into consideration that all the parties involved share common goals in pursuit of certain primordial State policies and principles that are enshrined in the Constitution and pertinent laws, such as

the protection of the environment, the empowerment of the local government units, the promotion of tourism, and the encouragement of the participation of the private sector. The Court seeks to reconcile the respective roles, duties and responsibilities of the petitioner and respondents in achieving these shared goals within the context of our Constitution, laws and regulations.

Nature of the Case

This is an original petition for the issuance of an Environmental Protection Order in the nature of a continuing mandamus under A.M. No. 09-6-8-SC, otherwise known as the Rules of Procedure for Environmental Cases, promulgated on April 29, 2010.

The Parties

Petitioner Boracay Foundation, Inc. (petitioner) is a duly registered, non-stock domestic corporation. Its primary purpose is to foster a united, concerted and environment -conscious development of Boracay Island, thereby preserving and maintaining its culture, natural beauty and ecological balance, marking the island as the crown jewel of Philippine tourism, a prime tourist destination in Asia and the whole world.
[2] [1]

It counts among its members at least sixty (60) owners

and representatives of resorts, hotels, restaurants, and similar institutions; at least five community organizations; and several environmentally-conscious residents and advocates.

Respondent Province of Aklan (respondent Province) is a political subdivision of the government created pursuant to Republic Act No. 1414, represented by Honorable Carlito S. Marquez, the Provincial Governor (Governor Marquez).

Respondent Philippine Reclamation Authority (respondent PRA), formerly called the Public Estates Authority (PEA), is a government entity created by Presidential Decree No. 1084,
[3]

which states that one of the purposes for which

respondent PRA was created was to reclaim land, including foreshore and submerged areas. PEA eventually became the lead agency primarily responsible for all reclamation projects in the country under Executive Order No. 525, series of 1979. In June 2006, the President of the Philippines issued Executive Order No. 543, delegating the power to approve reclamation projects to PRA through its governing Board, subject to compliance with existing laws and rules and further subject to the condition that reclamation contracts to be executed with any person or entity (must) go through public bidding.
[4]

Respondent Department of Environment and Natural Resources Environmental Management Bureau (DENREMB), Regional Office VI (respondent DENR-EMB RVI), is the government agency in the Western Visayas Region authorized to issue environmental compliance certificates regarding projects that require the environments protection and management in the region.
[5]

Summary of Antecedent Facts

Boracay Island (Boracay), a tropical paradise located in the Western Visayas region of the Philippines and one of the countrys most popular tourist destinations, was declared a tourist zone and marine reserve in 1973 under Presidential Proclamation No. 1801.
[6]

The island comprises the barangays of Manoc-manoc, Balabag, and Yapak, all within the
[7]

municipality of Malay, in the province of Aklan.

Petitioner describes Boracay as follows: Boracay is well-known for its distinctive powdery white-sand beaches which are the product of the unique ecosystem dynamics of the area. The island itself is known to come from the uplifted remnants of an ancient reef platform. Its beaches, the sandy land strip between the water and the area currently occupied by numerous establishments, is the primary draw for domestic and international tourists for its color, texture and other unique characteristics. Needless to state, it is the premier domestic and [8] international tourist destination in the Philippines.

More than a decade ago, respondent Province built the Caticlan Jetty Port and Passenger Terminal at Barangay Caticlan to be the main gateway to Boracay. It also built the corresponding Cagban Jetty Port and Passenger Terminal to be the receiving end for tourists in Boracay. Respondent Province operates both ports to provide structural facilities suited for locals, tourists and guests and to provide safety and security measures.
[9]

In 2005, Boracay 2010 Summit was held and participated in by representatives from national government agencies, local government units (LGUs), and the private sector. Petitioner was one of the organizers and participants thereto. The Summit aimed to re-establish a common vision of all stakeholders to ensure the conservation, restoration, and preservation of Boracay Island and to develop an action plan that [would allow] all s ectors to work in concert among and with each other for the long term benefit and sustainability of the island and the community. Terminal Report
[11] [10]

The Summit yielded a

stating that the participants had shared their dream of having world-class land, water and air

infrastructure, as well as given their observations that government support was lacking, infrastructure was poor, and, more importantly, the influx of tourists to Boracay was increasing. The Report showed that there was a need to expand the port facilities at Caticlan due to congestion in the holding area of the existing port, caused by inadequate facilities, thus tourists suffered long queues while waiting for the boat ride going to the island.
[12]

Respondent Province claimed that tourist arrivals to Boracay reached approximately 649,559 in 2009 and 779,666 in 2010, and this was expected to reach a record of 1 million tourist arrivals in the years to come. Thus, respondent Province conceptualized the expansion of the port facilities at Barangay Caticlan.
[13]

The Sangguniang Barangay of Caticlan, Malay Municipality, issued Resolution No. 13, s. 2008

[14]

on April 25,

2008 stating that it had learned that respondent Province had filed an application with the DENR for a foreshore lease of areas along the shorelines of Barangay Caticlan, and manifesting its strong opposition to said application, as the proposed foreshore lease practically covered almost all the coastlines of said barangay, thereby technically diminishing its territorial jurisdiction, once granted, and depriving its constituents of their statutory right of preference in the development and utilization of the natural resources within its jurisdiction. The resolution further stated that respondent Province did not conduct any consultations with the Sangguniang Barangay of Caticlan regarding the proposed foreshore lease, which failure the Sanggunian considered as an act of bad faith on the part of respondent Province.
[15]

On November 20, 2008, the Sangguniang Panlalawigan of respondent Province approved Resolution No. 2008369,
[16]

formally authorizing Governor Marquez to enter into negotiations towards the possibility of effecting self-liquidating

and income-producing development and livelihood projects to be financed through bonds, debentures, securities, collaterals, notes or other obligations as provided under Section 299 of the Local Government Code, with the following priority projects: (a) renovation/rehabilitation of the Caticlan/Cagban Passenger Terminal Buildings and Jetty Ports; and (b) reclamation of a portion of Caticlan foreshore for commercial purposes.
[17]

This step was taken as respondent

Provinces existing jetty port and passenger terminal was funded through bond flotation, which was successfully redeemed and paid ahead of the target date. This was allegedly cited as one of the LGUs Best Practices wherein respondent Province was given the appropriate commendation.
[18]

Respondent Province included the proposed expansion of the port facilities at Barangay Caticlan in its 2009 Annual Investment Plan,
[19]

envisioned as its project site the area adjacent to the existing jetty port, and identified
[20]

additional areas along the coastline of Barangay Caticlan as the site for future project expansion.

Governor Marquez sent a letter to respondent PRA on March 12, 2009

[21]

expressing the interest of respondent

Province to reclaim about 2.64 hectares of land along the foreshores of Barangay Caticlan, Municipality of Malay, Province of Aklan.

Sometime in April 2009, respondent Province entered into an agreement with the Financial Advisor/Consultant that won in the bidding process held a month before, to conduct the necessary feasibility study of the proposed project for the Renovation/Rehabilitation of the Caticlan Passenger Terminal Building and Jetty Port, Enhancement and Recovery of Old

Caticlan Coastline, and Reclamation of a Portion of Foreshore for Commercial Purposes ( the Marina Project), in Malay, Aklan.
[22]

Subsequently, on May 7, 2009, the Sangguniang Panlalawigan of respondent Province issued Resolution No. 2009110,
[23]

which authorized Governor Marquez to file an application to reclaim the 2.64 hectares of foreshore

area in Caticlan, Malay, Aklan with respondent PRA.

Sometime in July 2009, the Financial Advisor/Consultant came up with a feasibility study which focused on the land reclamation of 2.64 hectares by way of beach enhancement and recovery of the old Caticlan coastline for the rehabilitation and expansion of the existing jetty port, and for its future plans the construction of commercial building and wellness center. The financial component of the said study was Two Hundred Sixty Million Pesos (P260,000,000.00). Its suggested financing scheme was bond flotation.
[24]

Meanwhile, the Sangguniang Bayan of the Municipality of Malay expressed its strong opposition to the intended foreshore lease application, throughResolution No. 044,
[25]

approved on July 22, 2009, manifesting therein that

respondent Provinces foreshore lease application was for bu siness enterprise purposes for its benefit, at the expense of the local government of Malay, which by statutory provisions was the rightful entity to develop, utilize and reap benefits from the natural resources found within its jurisdiction.
[26]

In August 2009, a Preliminary Geohazard Assessment

[27]

for the enhancement/expansion of the existing Caticlan

Jetty Port and Passenger Terminal through beach zone restoration and Protective Marina Developments in Caticlan, Malay, Aklan was completed.

Thereafter, Governor Marquez submitted an Environmental Performance Report and Monitoring Program (EPRMP)
[28]

to DENR-EMB RVI, which he had attached to his letter

[29]

dated September 19, 2009, as an initial step for

securing an Environmental Compliance Certificate (ECC). The letter reads in part:

With the project expected to start its construction implementation next month, the province hereby assures your good office that it will give preferential attention to and shall comply with whatever [30] comments that you may have on this EPRMP. (Emphasis added.)

Respondent Province was then authorized to issue Caticlan Super Marina Bonds for the purpose of funding the renovation of the Caticlan Jetty Port and Passenger Terminal Building, and the reclamation of a portion of the foreshore lease area for commercial purposes in Malay, Aklan through Provincial Ordinance No. 2009-013, approved on September 10, 2009. The said ordinance authorized Governor Marquez to negotiate, sign and execute agreements in relation to the issuance of the Caticlan Super Marina Bonds in the amount not exceeding P260,000,000.00.
[31]

Subsequently, the Sangguniang Panlalawigan of the Province of Aklan issued Provincial Ordinance No. 2009015
[32]

on October 1, 2009, amending Provincial Ordinance No. 2009-013, authorizing the bond flotation of the Province of

Aklan through Governor Marquez to fund the Marina Project and appropriate the entire proceeds of said bonds for the project, and further authorizing Governor Marquez to negotiate, sign and execute contracts or agreements pertinent to the transaction.
[33]

Within the same month of October 2009, respondent Province deliberated on the possible expansion from its original proposed reclamation area of 2.64 hectares to forty (40) hectares in order to maximize the utilization of its resources and as a response to the findings of the Preliminary Geohazard Assessment study which showed that the recession and retreat of the shoreline caused by coastal erosion and scouring should be the first major concern in the project site and nearby coastal area. The study likewise indicated the vulnerability of the coastal zone within the proposed project site and the nearby coastal area due to the effects of sea level rise and climate change which will greatly affect the social, economic, and environmental situation of Caticlan and nearby Malay coastal communities.
[34]

In his letter dated October 22, 2009 addressed to respondent PRA, Governor Marquez wrote:

With our substantial compliance with the requirements under Administrative Order No. 2007-2 relative to our request to PRA for approval of the reclamation of the [proposed Beach Zone Restoration and Protection Marine Development in Barangays Caticlan and Manoc-Manoc] and as a result of our discussion during the [meeting with the respondent PRA on October 12, 2009], may we respectfully submit a revised Reclamation Project Description embodying certain revisions/changes in the size and location of the areas to be reclaimed. x x x.

On another note, we are pleased to inform your Office that the bond flotation we have secured with the Local Government Unit Guarantee Corporation (LGUGC) has been finally approved last October 14, 2009. This will pave the way for the implementation of said project. Briefly, the Province has been recognized by the Bureau of Local Government Finance (BLGF) for its capability to meet its loan obligations. x x x.

With the continued increase of tourists coming to Boracay through Caticlan, the Province is venturing into such development project with the end in view of protection and/or restoring certain segments of the shoreline in Barangays Caticlan (Caticlan side) and Manoc-manoc (Boracay side) which, as reported by experts, has been experiencing tremendous coastal erosion.

For the project to be self-liquidating, however, we will be developing the reclaimed land for [35] commercial and tourism-related facilities and for other complementary uses. (Emphasis ours.)

Then, on November 19, 2009, the Sangguniang Panlalawigan enacted Resolution No. 2009-299

[36]

authorizing

Governor Marquez to enter into a Memorandum of Agreement (MOA) with respondent PRA in the implementation of the Beach Zone Restoration and Protection Marina Development Project, which shall reclaim a total of 40 hectares in the areas adjacent to the jetty ports at Barangay Caticlan and Barangay Manoc-manoc. The Sangguniang

Panlalawigan approved the terms and conditions of the necessary agreements for the implementation of the bond flotation of respondent Province to fund the renovation/rehabilitation of the existing jetty port by way of enhancement and recovery of the Old Caticlan shoreline through reclamation of an area of 2.64 hectares in the amount ofP260,000,000.00 on December 1, 2009.
[37]

Respondent Province gave an initial presentation of the project with consultation to the Sangguniang Bayan of Malay
[38]

on December 9, 2009.

Respondent PRA approved the reclamation project on April 20, 2010 in its Resolution No. 4094 and authorized its General Manager/Chief Executive Officer (CEO) to enter into a MOA with respondent Province for the implementation of the reclamation project.
[39]

On April 27, 2010, DENR-EMB RVI issued to respondent Province ECC-R6-1003-096-7100 (the questioned ECC) for Phase 1 of the Reclamation Project to the extent of 2.64 hectares to be done along the Caticlan side beside the existing jetty port.
[40]

On May 17, 2010, respondent Province entered into a MOA was described therein as follows:

[41]

with respondent PRA. Under Article III, the Project

The proposed Aklan Beach Zone Restoration and Protection Marina Development Project involves the reclamation and development of approximately forty (40) hectares of foreshore and offshore areas of the Municipality of Malay x x x. The land use development of the reclamation project shall be for commercial, recreational and [42] institutional and other applicable uses. (Emphases supplied.) It was at this point that respondent Province deemed it necessary to conduct a series of what it calls information-education campaigns, which provided the venue for interaction and dialogue with the public, particularly the Barangay and Municipal officials of the Municipality of Malay, the residents of Barangay Caticlan and Boracay, the stakeholders, and the non-governmental organizations (NGOs). The details of the campaign are summarized as follows
[43]

: June 17, 2010 at Casa Pilar Beach Resort, Boracay Island, Malay, Aklan;
[44]

a.

b. c. d.

July 28, 2010 at Caticlan Jetty Port and Passenger Terminal; July 31, 2010 at Barangay Caticlan Plaza;
[46]

[45]

September 15, 2010 at the Office of the Provincial Governor with Municipal Mayor of Malay Mayor [47] John P. Yap; October 12, 2010 at the Office of the Provincial Governor with the Provincial Development [48] Council Executive Committee; and October 29, 2010 at the Office of the Provincial Governor with Officials of LGU-Malay and [49] Petitioner.

e.

f.

Petitioner claims that during the public consultation meeting belatedly called by respondent Province on June 17, 2010, respondent Province presented the Reclamation Project and only then detailed the actions that it had already undertaken, particularly: the issuance of the Caticlan Super Marina Bonds; the execution of the MOA with respondent PRA; the alleged conduct of an Environmental Impact Assessment (EIA) study for the reclamation project; and the expansion of the project to forty (40) hectares from 2.64 hectares.
[50]

In Resolution No. 046, Series of 2010, adopted on June 23, 2010, the Malay Municipality reiterated its strong opposition to respondent Provinces project and denied its request for a favorableendorsement of the Marina Project.
[51]

The Malay Municipality subsequently issued Resolution No. 016, Series of 2010, adopted on August 3, 2010, to request respondent PRA not to grant reclamation permit and notice to proceed to the Marina Project of the [respondent] Provincial Government of Aklan located at Caticlan, Malay, Aklan.
[52]

In a letter

[53]

dated October 12, 2010, petitioner informed respondent PRA of its opposition to the reclamation

project, primarily for the reason that, based on the opinion of Dr. Porfirio M. Alio, an expert from the University of the Philippines Marine Science Institute (UPMSI), which he rendered based on the documents submitted by respondent Province to obtain the ECC, a full EIA study is r equired to assess the reclamation projects likelihood of rendering critical and lasting effect on Boracay considering the proximity in distance, geographical location, current and wind direction, and many other environmental considerations in the area. Petitioner noted that said documents had failed to deal with coastal erosion concerns in Boracay. It also noted that respondent Province failed to comply with certain mandatory provisions of the Local Government Code, particularly, those requiring the project proponent to conduct consultations with stakeholders.

Petitioner likewise transmitted its Resolution No. 001, Series of 2010, registering its opposition to the reclamation project to respondent Province, respondent PRA, respondent DENR-EMB, the National Economic Development Authority Region VI, the Malay Municipality, and other concerned entities.
[54]

Petitioner alleges that despite the Malay Mun icipalitys denial of respondent Provinces request for a favorable endorsement, as well as the strong opposition manifested both by Barangay Caticlan and petitioner as an NGO, respondent Province still continued with the implementation of the Reclamation Project.
[55]

On July 26, 2010, the Sangguniang Panlalawigan of respondent Province set aside Resolution No. 046, s. 2010, of the Municipality of Malay and manifested its support for the implementation of the aforesaid project through its Resolution No. 2010-022.
[56]

On July 27, 2010, the MOA was confirmed by respondent PRA Board of Directors under its Resolution No. 4130. Respondent PRA wrote to respondent Province on October 19, 2010, informing the latter to proceed with the reclamation and development of phase 1 of site 1 of its proposed project . Respondent PRA attached to said letter its Evaluation Report dated October 18, 2010.
[57]

Petitioner likewise received a copy of respondent PRAs letter dated October 19, 2010, which authorized respondent Province to proceed with phase 1 of the reclamation project, subject to compliance with the requirements of its Evaluation Report. The reclamation project was described as: [A] seafront development involving reclamation of an aggregate area of more or less, forty (40) hectares in two (2) separate sites both in Malay Municipality, Aklan Province. Site 1 is in Brgy. Caticlan with a total area of 36.82 hectares and Site 2 in Brgy. Manoc-Manoc, Boracay Island with a total area of 3.18 hectares. Sites 1 and 2 are on the opposite sides of Tabon Strait, about 1,200 meters apart. [58] x x x. (Emphases added.)

The Sangguniang Panlalawigan of Aklan, through Resolution No. 2010-034,

[59]

addressed the apprehensions of

petitioner embodied in its Resolution No. 001, s. 2010, and supported the implementation of the project. Said resolution stated that the apprehensions of petitioner with regard to the economic, social and political negative impacts of the projects were mere perceptions and generalities and were not anchored on definite scientific, social and political studies.

In the meantime, a study was commissioned by the Philippine Chamber of Commerce and Industry-Boracay (PCCI-Boracay), funded by the Department of Tourism (DOT) with the assistance of, among others, petitioner. The study was conducted in November 2010 by several marine biologists/experts from the Marine Environmental Resources Foundation (MERF) of the UPMSI. The study was intended to determine the potential impact of a reclamation project in the hydrodynamics of the strait and on the coastal erosion patterns in the southern coast of Boracay Island and along the coast of Caticlan.
[60]

After noting the objections of the respective LGUs of Caticlan and Malay, as well as the apprehensions of petitioner, respondent Province issued a notice to the contractor on December 1, 2010 to commence with the construction of the project.
[61]

On April 4, 2011, the Sangguniang Panlalawigan of Aklan, through its Committee on Cooperatives, Food, Agriculture, and Environmental Protection and the Committee on Tourism, Trade, Industry and Commerce, conducted a joint committee hearing wherein the study undertaken by the MERF-UPMSI was discussed.
[62]

In attendance were Mr.

Ariel Abriam, President of PCCI-Boracay, representatives from the Provincial Government, and Dr. Cesar Villanoy, a professor from the UPMSI. Dr. Villanoy said that the subject project, consisting of 2.64 hectares, would only have insignificanteffect on the hydrodynamics of the strait traversing the coastline of Barangay Caticlan and Boracay, hence, there was a distant possibility that it would affect the Boracay coastline, which includes the famous white-sand beach of the island.
[63]

Thus, on April 6, 2011, the Sangguniang Panlalawigan of Aklan enacted Resolution No. 2011-065

[64]

noting the

report on the survey of the channel between Caticlan and Boracay conducted by the UPMSI in relation to the effects of the ongoing reclamation to Boracay beaches, and stating that Dr. Villanoy had admitted that nowhere in their study was it pointed out that there would be an adverse effect on the white-sand beach of Boracay. During the First Quarter Regular Meeting of the Regional Development Council, Region VI (RDC-VI) on April 16, 2011, it approved and supported the subject project (covering 2.64 hectares) through RDC-VI Resolution No. VI-26, series of 2011.
[65]

Subsequently, Mr. Abriam sent a letter to Governor Marquez dated April 25, 2011 stating that the study conducted by the UPMSI confirms that the water flow across the Caticlan-Boracay channel is primarily tide-driven, therefore, the marine scientists believe that the 2.64-hectare project of respondent Province would not significantly affect the flow in the channel and would unlikely impact the Boracay beaches. Based on this, PCCI-Boracay stated that it was not opposing the 2.64-hectare Caticlan reclamation project on environmental grounds.
[66]

On June 1, 2011, petitioner filed the instant Petition for Environmental Protection Order/Issuance of the Writ of Continuing Mandamus. On June 7, 2011, this Court issued a Temporary Environmental Protection Order (TEPO) and ordered the respondents to file their respective comments to the petition.
[67]

After receiving a copy of the TEPO on June 9, 2011, respondent Province immediately issued an order to the Provincial Engineering Office and the concerned contractor to cease and desist from conducting any construction activities until further orders from this Court. The petition is premised on the following grounds:

I.

THE RESPONDENT PROVINCE, PROPONENT OF THE RECLAMATION PROJECT, FAILED TO COMPLY WITH RELEVANT RULES AND REGULATIONS IN THE ACQUISITION OF AN ECC.

A.

THE RECLAMATION PROJECT IS CO-LOCATED WITHIN ENVIRONMENTALLY CRITICAL AREAS REQUIRING THE PERFORMANCE OF A FULL, OR PROGRAMMATIC, ENVIRONMENTAL IMPACT ASSESSMENT.

B.

RESPONDENT PROVINCE FAILED TO OBTAIN THE FAVORABLE ENDORSEMENT OF THE LGU CONCERNED.

C.

RESPONDENT PROVINCE FAILED TO CONDUCT THE REQUIRED CONSULTATION PROCEDURES AS REQUIRED BY THE LOCAL GOVERNMENT CODE.

D.

RESPONDENT PROVINCE FAILED TO PERFORM A FULL ENVIRONMENTAL IMPACT ASSESSMENT AS REQUIRED BY LAW AND RELEVANT REGULATIONS.

II. THE RECLAMATION OF LAND BORDERING THE STRAIT BETWEEN CATICLAN AND BORACAY [68] SHALL ADVERSELY AFFECT THE FRAIL ECOLOGICAL BALANCE OF THE AREA.

Petitioner objects to respondent Provinces classification of the reclamation project as single instead of co located, as non-environmentally critical, and as a mere rehabilitation of the existing jetty port. Petitioner points out that the reclamation project is on two sites (which are situated on the opposite sides of Tabon Strait, about 1,200 meters apart): 36.82 hectares Site 1, in Bgy. Caticlan [69] 3.18 hectares Site 2, in Manoc-manoc, Boracay Island

Phase 1, which was started in December 2010 without the necessary permits,

[70]

is located on the Caticlan side of

a narrow strait separating mainland Aklan from Boracay. In the implementation of the project, respondent Province obtained only an ECC to conduct Phase 1, instead of an ECC on the entire 40 hectares. Thus, petitioner argues that respondent Province abused and exploited the Revised Procedural Manual for DENR Administrative Order No. 30, Series of 2003 (DENR DAO 2003-30) 1.
[71]

relating to the acquisition of an ECC by:

Declaring the reclamation project under Group II Projects-Non-ECP (environmentally critical project) in ECA (environmentally critical area) based on the type and size of the area , and Failing to declare the reclamation project as a co-located project application which would have required the Province to submit a Programmatic Environmental Impact Statement

2.

(PEIS) or Programmatic Environmental [73] (PE[P]RMP). (Emphases ours.)

[72]

[Performance]

Report

Management

Plan

Petitioner further alleges that the Revised Procedural Manual (on which the classification above is based, which merely requires an Environmental Impact Statement [EIS] for Group II projects) is patently ultra vires, and respondent DENR-EMB RVI committed grave abuse of discretion because the laws on EIS, namely, Presidential Decree Nos. 1151 and 1586, as well as Presidential Proclamation No. 2146, clearly indicate that projects in environmentally critical areas are to be immediately considered environmentally
[74]

critical. Petitioner

complains

that

respondent

Province applied for an ECC only for Phase 1; hence, unlawfully evading the requirement that co-located projects PEIS and/or a PEPRMP. within Environmentally Critical Areas (ECAs) must submit a

Petitioner argues that respondent Province fraudulently classified and misrepresented the project as a Non-ECP in an ECA, and as a single project instead of a co-located one. The impact assessment allegedly performed gives a patently erroneous and wrongly-premised appraisal of the possible environmental impact of the reclamation project. Petitioner contends that respondent Provinces choice of classification was designed to avoid a comprehensive impact assessment of the reclamation project.

Petitioner further contends that respondent DENR-EMB RVI willfully and deliberately disregarded its duty to ensure that the environment is protected from harmful developmental projects because it allegedly performed only a cursory and superficial review of the documents submitted by the respondent Province for an ECC, failing to note that all the information and data used by respondent Province in its application for the ECC were all dated and not current, as data was gathered in the late 1990s for the ECC issued in 1999 for the first jetty port. Thus, petitioner alleges that respondent DENR-EMB RVI ignored the environmental impact to Boracay, which involves changes in the structure of the coastline that could contribute to the changes in the characteristics of the sand in the beaches of both Caticlan and Boracay.

Petitioner insists that reclamation of land at the Caticlan side will unavoidably adversely affect the Boracay side and notes that the declared objective of the reclamation project is for the exploitation of Boracays tourist trade, since th e project is intended to enhance support services thereto. But, petitioner argues, the primary reason for Boracays popularity is its white-sand beaches which will be negatively affected by the project.

Petitioner alleges that respondent PRA had required respondent Province to obtain the favorable endorsement of the LGUs of Barangay Caticlan and Malay Municipality pursuant to the consultation procedures as required by the Local Government Code.
[75]

Petitioner asserts that the reclamation project is in violation not only of laws on EIS but also of the
[76]

Local Government Code as respondent Province failed to enter into proper consultations with the concerned LGUs. In fact, the Liga ng mga Barangay-Malay Chapter also expressed strong opposition against the project.

Petitioner cites Sections 26 and 27 of the Local Government Code, which require consultations if the project or program may cause pollution, climactic change, depletion of non-renewable resources,etc. According to petitioner,

respondent Province ignored the LGUs opposition expressed as early as 2008. Not only that, respondent Province belatedly called for public consultation meetings on June 17 and July 28, 2010, after an ECC had already been issued and the MOA between respondents PRA and Province had already been executed. As the petitioner saw it, these were not consultations but mere project presentations.

Petitioner claims that respondent Province, aided and abetted by respondents PRA and DENR-EMB, ignored the spirit and letter of the Revised Procedural Manual, intended to implement the various regulations governing the Environmental Impact Assessments (EIAs) to ensure that developmental projects are in line with sustainable development of natural resources. The project was conceptualized without considering alternatives.

Further, as to its allegation that respondent Province failed to perform a full EIA, petitioner argues that while it is true that as of now, only the Caticlan side has been issued an ECC, the entire project involves the Boracay side, which should have been considered a co-located project. Petitioner claims that any project involving Boracay requires a full EIA since it is an ECA. Phase 1 of the project will affect Boracay and Caticlan as they are separated only by a narrow strait; thus, it should be considered an ECP. Therefore, the ECC and permit issued must be invalidated and cancelled.

Petitioner contends that a study shows that the flow of the water through a narrower channel due to the reclamation project will likely divert sand transport off the southwest part of Boracay, whereas the characteristic coast of the Caticlan side of the strait indicate stronger sediment transport.
[77]

The white-sand beaches of Boracay and its

surrounding marine environment depend upon the natural flow of the adjacent waters.

Regarding its claim that the reclamation of land bordering the strait between Caticlan and Boracay shall adversely affect the frail ecological balance of the area, petitioner submits that while the study conducted by the MERF-UPMSI only considers the impact of the reclamation project on the land, it is undeniable that it will also adversely affect the already frail ecological balance of the area. The effect of the project would have been properly assessed if the proper EIA had been performed prior to any implementation of the project.

According to petitioner, respondent Provinces intended purposes do not prevail over its duty and obligation to protect the environment. Petitioner believes that rehabilitation of the Jetty Port may be done through other means.
[78]

In its Comment

dated June 21, 2011, respondent Province claimed that application for reclamation of 40

hectares is advantageous to the Provincial Government considering that its filing fee would only cost Php20,000.00 plus Value Added Tax (VAT) which is also the minimum fee as prescribed under Section 4.2 of Administrative Order No. 20072.
[79]

Respondent Province considers the instant petition to be premature; thus, it must necessarily fail for lack of cause of action due to the failure of petitioner to fully exhaust the available administrative remedies even before seeking judicial relief. According to respondent Province, the petition primarily assailed the decision of respondent DENR-EMB RVI in granting the ECC for the subject project consisting of 2.64 hectares and sought the cancellation of the ECC for alleged

failure of respondent Province to submit proper documentation as required for its issuance. Hence, the grounds relied upon by petitioner can be addressed within the confines of administrative processes provided by law.

Respondent Province believes that under Section 5.4.3 of DENR Administrative Order No. 2003-30 (DAO 200330),
[80]

the issuance of an ECC

[81]

is an official decision of DENR-EMB RVI on the application of a project proponent.

[82]

It

cites Section 6 of DENR DAO 2003-30, which provides for a remedy available to the party aggrieved by the final decision on the proponents ECC applications.

Respondent Province argues that the instant petition is anchored on a wrong premise that results to petitioners unfounded fears and baseless apprehensions. It is respondent Provinces contention that its 2.64-hectare reclamation project is considered as a stand alone project, separate and independent from the approved area of 40 hectares. Thus, petitioner should have observed the difference between the future development plan of re spondent Province from its actual project being undertaken.
[83]

Respondent Province clearly does not dispute the fact that it revised its original application to respondent PRA from 2.64 hectares to 40 hectares. However, it claims that such revision is part of its future plan, and implementation thereof is still subject to availability of funds, independent scientific environmental study, separate application of ECC and notice to proceed to be issued by respondent PRA.
[84]

Respondent Province goes on to claim that [p]etitioners version of the Ca ticlan jetty port expansion project is a bigger project which is still at the conceptualization stage. Although this project was described in the Notice to Proceed issued by respondent PRA to have two phases, 36.82 hectares in Caticlan and 3.18 hectares in Boracay [Island,] it is totally different from the [ongoing] Caticlan jetty port expansion project.
[86] [85]

Respondent Province says that the Accomplishment Report

of its Engineering Office would attest that the

actual project consists of 2.64 hectares only, as originally planned and conceptualized, which was even reduced to 2.2 hectares due to some construction and design modifications.

Thus, respondent Province alleges that from its standpoint, its capability to reclaim is limited to 2.64 hectares only, based on respondent PRAs Evaluation Report
[87]

dated October 18, 2010, which was in turn the basis of the

issuance of the Notice to Proceed dated October 19, 2010, because the projects financial componen t is P260,000,000.00 only. Said Evaluation Report indicates that the implementation of the other phases of the project including site 2, which consists of the other portions of the 40-hectare area that includes a portion in Boracay, is still within the 10-year period and will depend largely on the availability of funds of respondent Province.
[88]

So, even if respondent PRA approved an area that would total up to 40 hectares, it was divided into phases in order to determine the period of its implementation. Each phase was separate and independent because the source of funds was also separate. The required documents and requirements were also specific for each phase. The entire

approved area of 40 hectares could be implemented within a period of 10 years but this would depend solely on the availability of funds.
[89]

As far as respondent Province understands it, additional reclamations not covered by the ECC, which only approved 2.64 hectares, should undergo another EIA. If respondent Province intends to commence the construction on the other component of the 40 hectares, then it agrees that it is mandated to secure a new ECC.
[90]

Respondent Province admits that it dreamt of a 40-hectare project, even if it had originally planned and was at present only financially equipped and legally compliant to undertake 2.64 hectares of the project, and only as an expansion of its old jetty port.
[91]

Respondent Province claims that it has complied with all the necessary requirements for securing an ECC. On the issue that the reclamation project is within an ECA requiring the performance of a full or programmatic EIA, respondent Province reiterates that the idea of expanding the area to 40 hectares is only a future plan. It only secured an ECC for 2.64 hectares, based on the limits of its funding and authority. From the beginning, its intention was to rehabilitate and expand the existing jetty port terminal to accommodate an increasing projected traffic. The subject project is specifically classified under DENR DAO 2003-30 on its Project Grouping Matrix for Determination of EIA Report Type considered as Minor Reclamation Projects falling under Group II Non ECP in an ECA. Whether 2.64 or 40 hectares in area, the subject project falls within this classification.

Consequently, respondent Province claims that petitioner erred in considering the ongoing reclamation project at Caticlan, Malay, Aklan, as co-located within an ECA.

Respondent Province, likewise argues that the 2.64-hectare project is not a component of the approved 40hectare area as it is originally planned for the expansion site of the existing Caticlan jetty port. At present, it has no definite conceptual construction plan of the said portion in Boracay and it has no financial allocation to initiate any project on the said Boracay portion.

Furthermore, respondent Province contends that the present project is located in Caticlan while the alleged component that falls within an ECA is in Boracay. Considering its geographical location, the two sites cannot be considered as a contiguous area for the reason that it is separated by a body of water a strait that traverses between the mainland Panay wherein Caticlan is located and Boracay. Hence, it is erroneous to consider the two sites as a co-located project within an ECA. Being a stand alone project and an expansion of the existing jetty port, res pondent DENR-EMB RVI had required respondent Province to perform an EPRMP to secure an ECC as sanctioned by Item No. 8(b), page 7 of DENR DAO 2003-30.

Respondent Province contends that even if, granting for the sake of argument, it had erroneously categorized its project as Non-ECP in an ECA, this was not a final determination. Respondent DENR-EMB RVI, which was the administrator of the EIS system, had the final decision on this matter. Under DENR DAO 2003-30, an application for ECC, even for a Category B2 project where an EPRMP is conducted, shall be subjected to a review process. Respondent

DENR-EMB RVI had the authority to deny said application. Its Regional Director could either issue an ECC for the project or deny the application. He may also require a more comprehensive EIA study. The Regional Director issued the ECC based on the EPRMP submitted by respondent Province and after the same went through the EIA review process.

Thus, respondent Province concludes that petitioners allegation of this being a co-located project is premature if not baseless as the bigger reclamation project is still on the conceptualization stage. Both respondents PRA and Province are yet to complete studies and feasibility studies to embark on another project.

Respondent Province claims that an ocular survey of the reclamation project revealed that it had worked within the limits of the ECC.
[92]

With regard to petitioners allegation that respondent Province failed to get the favorable endorsement of the concerned LGUs in violation of the Local Government Code, respondent Province contends that consultation vis-vis the favorable endorsement from the concerned LGUs as contemplated under the Local Government Code are merely tools to seek advice and not a power clothed upon the LGUs to unilaterally approve or disapprove any government projects. Furthermore, such endorsement is not necessary for projects falling under Category B2 unless required by the DENR-EMB RVI, under Section 5.3 of DENR DAO 2003-30.

Moreover, DENR Memorandum Circular No. 08-2007 no longer requires the issuance of permits and certifications as a pre-requisite for the issuance of an ECC. Respondent Province claims to have conducted consultative activities with LGUs in connection with Sections 26 and 27 of the Local Government Code. The vehement and staunch objections of both the Sangguniang Barangay of Caticlan and the Sangguniang Bayan of Malay, according to respondent Province, were not rooted on its perceived impact upon the people and the community in terms of environmental or ecological balance, but due to an alleged conflict with their principal position to develop, utilize and reap ben efits from the natural resources found within its jurisdiction.
[93]

Respondent Province argues that these concerns are not within the

purview of the Local Government Code. Furthermore, the Preliminary Geohazard Assessment Report and EPRMP as well as Sangguniang Panlalawigan Resolution Nos. 2010-022 and 2010-034 should address any environmental issue they may raise.

Respondent Province posits that the spirit and intent of Sections 26 and 27 of the Local Government Code is to create an avenue for parties, the proponent and the LGU concerned, to come up with a tool in harmonizing its views and concerns about the project. The duty to consult does not automatically require adherence to the opinions during the consultation process. It is allegedly not within the provisions to give the full authority to the LGU concerned to unilaterally approve or disapprove the project in the guise of requiring the proponent of securing its favorable endorsement. In this case, petitioner is calling a halt to the project without providing an alternative resolution to harmonize its position and that of respondent Province.
[94]

Respondent Province claims that the EPRMP

would reveal that:

[T]he area fronting the project site is practically composed of sand. Dead coral communities may be found along the vicinity. Thus, fish life at the project site is quite scarce due to the absence of marine support systems like the sea grass beds and coral reefs. x x x [T]here is no coral cover at the existing Caticlan jetty port. [From] the deepest point of jetty to the shallowest point, there was no more coral patch and the substrate is sandy. It is of public knowledge that the said foreshore area is being utilized by the residents ever since as berthing or anchorage site of their motorized banca. There will be no possibility of any coral development therein because of its continuous utilization. Likewise, the activity of the strait that traverses between the main land Caticlan and Boracay Island would also be a factor of the coral development. Corals [may] only be formed within the area if there is scientific human intervention, which is absent up to the present. In light of the foregoing premise, it casts serious doubt on petitioners allegations pertaining to the environmental effects of Respondent-LGUs 2.64 hectares reclamation project. The alleged environmental impact of the subject project to the beaches of Boracay Island remains unconfirmed. Petitioner had unsuccessfully proven that the project would cause imminent, grave and irreparable injury [95] to the community.

Respondent Province prayed for the dissolution of the TEPO, claiming that the rules provide that the TEPO may be dissolved if it appears after hearing that its issuance or continuance would cause irreparable damage to the party or person enjoined, while the applicant may be fully compensated for such damages as he may suffer and subject to the posting of a sufficient bond by the party or person enjoined. Respondent Province contends that the TEPO would cause irreparable damage in two aspects:

a. b.

Financial dislocation and probable bankruptcy; and Grave and imminent danger to safety and health of inhabitants of immediate area, including tourists and passengers serviced by the jetty port, brought about by the abrupt cessation of development works.

As regards financial dislocation, the arguments of respondent Province are summarized below:

1.

This project is financed by bonds which the respondent Province had issued to its creditors as the financing scheme in funding the present project is by way of credit financing through bond flotation. The funds are financed by a Guarantee Bank getting payment from bonds, being sold to investors, which in turn would be paid by the income that the project would realize or incur upon its completion. While the project is under construction, respondent Province is appropriating a portion of its Internal Revenue Allotment (IRA) budget from the 20% development fund to defray the interest and principal amortization due to the Guarantee Bank.

2.

3.

4. The respondent Provinces IRA, regular income, and/or such other revenues or funds, as may be permitted by law, are being used as security for the payment of th e said loan used for the projects construction. 5. The inability of the subject project to earn revenues as projected upon completion will compel the Province to shoulder the full amount of the obligation, starting from year 2012. 6. Respondent province is mandated to assign its IRA, regular income and/or such other revenues or [96] funds as permitted by law; if project is stopped, detriment of the public welfare and its constituents.

As to the second ground for the dissolution of the TEPO, respondent Province argues:

1.

Non-compliance with the guidelines of the ECC may result to environmental hazards most especially that reclaimed land if not properly secured may be eroded into the sea. The construction has accomplished 65.26 percent of the project. The embankment that was deposited on the project has no proper concrete wave protection that might be washed out in the event that a strong typhoon or big waves may occur affecting the strait and the properties along the project site. It is already the rainy season and there is a big possibility of typhoon occurrence. If said incident occurs, the aggregates of the embankment that had been washed out might be transferred to the adjoining properties which could affect its natural environmental state. It might result to the total alteration of the physical landscape of the area attributing to environmental disturbance.

2.

3.

4.

5. The lack of proper concrete wave protection or revetment would cause the total erosion of the [97] embankment that has been dumped on the accomplished area.

Respondent Province claims that petitioner will not stand to suffer immediate, grave and irreparable injury or damage from the ongoing project. The petitioners perceived fear of environmental destruction brought about by its erroneous appreciation of available data is unfounded and does not translate into a matter of extreme urgency. Thus, under the Rules of Procedure on Environmental Cases, the TEPO may be dissolved.
[98]

Respondent PRA filed its Comment

on June 22, 2011. It alleges that on June 24, 2006, Executive Order No.

543 delegated the power to approve reclamation projects to respondent PRA through its governing Board, subject to compliance with existing laws and rules and further subject to the condition that reclamation contracts to be executed with any person or entity (must) go through public bidding. Section 4 of respondent PRAs Administrative Order No. 2007 -2 provides for the approval process and procedures for various reclamation projects to be undertaken. Respondent PRA prepared an Evaluation Report on November 5, 2009
[99]

regarding Aklans proposal to increase its project to 40 hectares.

Respondent PRA contends that it was only after respondent Province had complied with the requirements under the law that respondent PRA, through its Board of Directors, approved the proposed project under its Board Resolution No. 4094.
[100]

In the same Resolution, respondent PRA Board authorized the General Manager/CEO to execute a MOA

with the Aklan provincial government to implement the reclamation project under certain conditions.

The issue for respondent PRA was whether or not it approved the respondent Provinces 2.64 -hectare reclamation project proposal in willful disregard of alleged numerous irregularities as claimed by petitioner.
[101]

Respondent PRA claims that its approval of the Aklan Reclamation Project was in accordance with law and its rules. Indeed, it issued the notice to proceed only after Aklan had complied with all the requirements imposed by existing laws and regulations. It further contends that the 40 hectares involved in this project remains a plan insofar as respondent PRA is concerned. What has been approved for reclamation by respondent PRA thus far is only the 2.64-hectare

reclamation project. Respondent PRA reiterates that it approved this reclamation project after extensively reviewing the legal, technical, financial, environmental, and operational aspects of the proposed reclamation.
[102]

One of the conditions that respondent PRA Board imposed before approving the Aklan project was that no reclamation work could be started until respondent PRA has approved the detailed engineering plans/methodology, design and specifications of the reclamation. Part of the required submissions to respondent PRA includes the drainage design as approved by the Public Works Department and the ECC as issued by the DENR, all of which the Aklan government must submit to respondent PRA before starting any reclamation works.
[103]

Under Article IV(B)(3) of the MOA

between respondent PRA and Aklan, the latter is required to submit, apart from the ECC, the following requirements for respondent PRAs review and approval, as basis for the issuance of a Notice to Proceed (NTP) for Reclamation Works: (a) (b) (c) Land-form plan with technical description of the metes and bounds of the same land-form; Final master development and land use plan for the project; Detailed engineering studies, detailed engineering design, plans and specification for reclamation works, reclamation plans and methodology, plans for the sources of fill materials; Drainage plan vis-a-vis the land-form approved by DPWH Regional Office to include a cost effective and efficient drainage system as may be required based on the results of the studies; Detailed project cost estimates and quantity take-off per items of work of the rawland reclamation components, e.g. reclamation containment structures and soil consolidation; Organizational chart of the construction arm, manning table, equipment schedule for the project; and, Project timetable (PERT/CPM) for the entire project construction period.
[104]

(d)

(e)

(f)

(g)

In fact, respondent PRA further required respondent Province under Article IV (B)(24) of the MOA to strictly comply with all conditions of the DENR-EMB-issued ECC and/or comply with pertinent local and international commitments of the Republic of the Philippines to ensure environmental protection.
[105]

In its August 11, 2010 letter,

[106]

respondent PRA referred for respondent Provinces appropriate action petitioners

Resolution 001, series of 2010 and Resolution 46, series of 2010, of the Sangguniang Bayan of Malay. Governor Marquez wrote respondent PRA the different officials of
[107]

on September 16, 2010 informing it that respondent Province had already met with furnishing respondent PRA with the copies of the minutes of such

Malay,

meetings/presentations. Governor Marquez also assured respondent PRA that it had complied with the consultation requirements as far as Malay was concerned.

Respondent PRA claims that in evaluating respondent Provinces project and in issuing the necessary NTP for Phase 1 of Site 1 (2.64 hectares) of the Caticlan Jetty Port expansion and modernization, respondent PRA gave considerable weight to all pertinent issuances, especially the ECC issued by DENR-EMB RVI.
[108]

Respondent PRA

stresses that its earlier approval of the 40-hectare reclamation project under its Resolution No. 4094, series of 2010, still requires a second level of compliance requirements from the proponent. Respondent Province could not possibly begin its reclamation works since respondent PRA had yet to issue an NTP in its favor.

Respondent PRA alleges that prior to the issuance of the NTP to respondent Province for Phase 1 of Site 1, it required the submission of the following pre-construction documents:

(a) Land-Form Plan (with technical description);

(b) Site Development Plan/Land Use Plan including,

(i) sewer and drainage systems and

(ii) waste water treatment;

(c) Engineering Studies and Engineering Design;

(d) Reclamation Methodology;

(e) Sources of Fill Materials, and,

(f) The ECC.

[109]

Respondent PRA claims that it was only after the evaluation of the above submissions that it issued to respondent Province the NTP, limited to the 2.64-hectare reclamation project. Respondent PRA even emphasized in its evaluation report that should respondent Province pursue the other phases of its project, it would still require the submission of an ECC for each succeeding phases before the start of any reclamation works.
[110]

Respondent PRA, being the national governments arm in regulating and coordinating all reclamation projects in the Philippines a mandate conferred by law manifests that it is incumbent upon it, in the exercise of its regulatory

functions, to diligently evaluate, based on its technical competencies, all reclamation projects submitted to it for approval. Once the reclamation projects requirements set forth by law and related rules have been complied with, respondent PRA is mandated to approve the same. Respondent PRA claims, [w]ith all the foregoing rigorous and detailed requirements submitted and complied with by Aklan, and the attendant careful and meticulous technical and legal evaluation by respondent PRA, it cannot be argued that the reclamation permit it issued to Aklan is founded upon numerous irregularities; as recklessly and baselessly imputed by BFI.
[111]

In its Comment

[112]

dated July 1, 2011, respondent DENR-EMB RVI asserts that its act of issuing the ECC certifies

that the project had undergone the proper EIA process by assessing, among others, the direct and indirect impact of the project on the biophysical and human environment and ensuring that these impacts are addressed by appropriate environmental protection and enhancement measures, pursuant to Presidential Decree No. 1586, the Revised Procedural Manual for DENR DAO 2003-30, and the existing rules and regulations.
[113]

Respondent DENR-EMB RVI stresses that the declaration in 1978 of several islands, which includes Boracay as tourist zone and marine reserve under Proclamation No. 1801, has no relevance to the expansion project of Caticlan Jetty Port and Passenger Terminal for the very reason that the project is not located in the Island of Boracay, being located in Barangay Caticlan, Malay, which is not a part of mainland Panay. It admits that the site of the subject jetty port falls within the ECA under Proclamation No. 2146 (1981), being within the category of a water body. This was why respondent Province had faithfully secured an ECC pursuant to the Revised Procedural Manual for DENR DAO 2003-30 by submitting the necessary documents as contained in the EPRMP on March 19, 2010, which were the bases in granting ECC No. R6-1003-096-7100 (amended) on April 27, 2010 for the expansion of Caticlan Jetty Port and Passenger Terminal, covering 2.64 hectares.
[114]

Respondent DENR-EMB RVI claims that the issues raised by the LGUs of Caticlan and Malay had been considered by the DENR-Provincial Environment and Natural Resources Office (PENRO), Aklan in the issuance of the Order
[115]

dated January 26, 2010, disregarding the claim of the Municipality of Malay, Aklan of a portion of the

foreshore land in Caticlan covered by the application of the Province of Aklan; and another Order of Rejection dated February 5, 2010 of the two foreshore applications, namely FLA No. 060412-43A and FLA No. 060412-43B, of the Province of Aklan.
[116]

Respondent DENR-EMB RVI contends that the supporting documents attached to the EPRMP for the issuance of an ECC were merely for the expansion and modernization of the old jetty port in Barangay Caticlan covering 2.64 hectares, and not the 40-hectare reclamation project in Barangay Caticlan and Boracay. The previous letter of respondent Province dated October 14, 2009 addressed to DENR-EMB RVI Regional Executive Director, would show that

the reclamation project will cover approximately 2.6 hectares. to lack of requirements or documents.

[117]

This application for ECC was not officially accepted due

Although petitioner insists that the project involves 40 hectares in two sites, respondent DENR-EMB RVI looked at the documents submitted by respondent Province and saw that the subject area covered by the ECC application and subsequently granted with ECC-R6-1003-096-7100 consists only of 2.64 hectares; hence, respondent DENR-EMB RVI could not comment on the excess area.
[118]

Respondent DENR-EMB RVI admits that as regards the classification of the 2.64-hectare reclamation project under Non ECP in ECA, this does not fall within the definition of a co -located project because the subject project is merely an expansion of the old Caticlan Jetty Port, which had a previously issued ECC (ECC No. 0699-1012-171 on October 12, 1999). Thus, only an EPRMP, not a PEIS or PEPRMP, is required.
[119]

Respondent Province submitted to respondent DENR-EMB RVI the following documents contained in the EPRMP: a. The Observations on the Floor Bottom and its Marine Resources at the Proposed Jetty Ports at Caticlan and Manok-manok, Boracay, Aklan, conducted in 1999 by the Bureau of Fisheries Aquatic Resources (BFAR) Central Office, particularly in Caticlan site, and The Study conducted by Dr. Ricarte S. Javelosa, Ph. D, Mines and Geosciences Bureau (MGB), Central Office and Engr. Roger Esto, Provincial Planning and Development Office (PPDO), Aklan in 2009 entitled Preliminary Geo-hazard Assessment for the Enhancement of the Existing Caticlan Jetty Port Terminal through Beach Zone Restoration and Protective Marina Development in Malay, Aklan.

b.

Respondent DENR-EMB RVI claims that the above two scientific studies were enough for it to arrive at a best professional judgment to issue an amended ECC for the Aklan Marina Project covering 2.64 hectares.
[120]

Furthermore, to

confirm that the 2.64-hectare reclamation has no significant negative impact with the surrounding environment particularly in Boracay, a more recent study was conducted, and respondent DENR-EMB RVI alleges that [i]t is very important to highlight that the input data in the [MERF- UPMSI] study utilized the [40-hectare] reclamation and [200-meter] width seaward using the tidal and wave modelling.
[121]

The study showed that the reclamation of 2.64 hectares had no effect to

the hydrodynamics of the strait between Barangay Caticlan and Boracay.

Respondent DENR-EMB RVI affirms that no permits and/or clearances from National Government Agencies (NGAs) and LGUs are required pursuant to the DENR Memorandum Circular No. 2007-08, entitled Simplifying the Requirements of ECC or CNC Applications; that the EPRMP was evaluated and processed based on the Revised Procedural Manual for DENR DAO 2003-30 which resulted to the issuance of ECC-R6-1003-096-7100; and that the ECC is not a permit per se but a planning tool for LGUs to consider in its decision whether or not to issue a local permit.
[122]

Respondent DENR-EMB RVI concludes that in filing this case, petitioner had bypassed and deprived the DENR Secretary of the opportunity to review and/or reverse the decision of his subordinate office, EMB RVI pursuant to the Revised Procedural Manual for DENR DAO 2003-30. There is no extreme urgency that necessitates the granting of Mandamus or issuance of TEPO that put to balance between the life and death of the petitioner or present grave or irreparable damage to environment.
[123]

After receiving the above Comments from all the respondents, the Court set the case for oral arguments on September 13, 2011.
[124]

Meanwhile, on September 8, 2011, respondent Province filed a Manifestation and Motion

praying for the

dismissal of the petition, as the province was no longer pursuing the implementation of the succeeding phases of the project due to its inability to comply with Article IV B.2(3) of the MOA; hence, the issues and fears expressed by petitioner had become moot. Respondent Province alleges that the petition is premised on a serious misappreciation of the real extent of the contested reclamation project as certainly the ECC covered only a total of 2,691 square meters located in Barangay Caticlan, Malay, Aklan; and although the MOA spoke of 40 hectares, respondent Provinces submission of documents to respondent PRA pertaining to said area was but the first of a two-step process of approval. Respondent Province claims that its failure to comply with the documentary requirements of respondent PRA within the period provided, or 120 working days from the effectivity of the MOA, indicated its waiver to pursue the remainder of the project.
[125]

Respondent Province further manifested:

[126]

Confirming this in a letter dated 12 August 2011, Governor Marquez informed respondent PRA that the Province of Aklan is no longer pursuing the implementation of the succeeding phases of the project with a total area of 37.4 hectares for our inability to comply with Article IV B.2 (3) of the MOA; hence, the existing MOA will cover only the project area of 2.64 hectares.

In his reply-letter dated August 22, 2011, [respondent] PRA General Manager informed Governor Marquez that the [respondent] PRA Board of Directors has given [respondent] PRA the authority to confirm the position of the Province of Aklan that the Aklan Beach Zone Restoration and Protection Marine Development Project will now be confined to the reclamation and development of the 2.64 hectares, more or less.

[127]

It is undisputed from the start that the coverage of the Project is in fact limited to 2.64 hectares, as evidenced by the NTP issued by respondent PRA. The recent exchange of correspondence between respondents Province of Aklan and [respondent] PRA further confirms the intent of the parties all along. Hence, the Project subject of the petition, without doubt, covers only 2.64 and not 40 hectares as feared. This completely changes the extent of the Project and, consequently, moots the issues and fears [128] expressed by the petitioner. (Emphasis supplied.)

Based on the above contentions, respondent Province prays that the petition be dismissed as no further justiciable controversy exists since the feared adverse effect to Boracay Islands ecology had become academic all together.
[129]

The Court heard the parties oral arguments on September 13, 2011 and gave the latter twenty (20) days thereafter to file their respective memoranda.

Respondent Province filed another Manifestation and Motion, stating that:

[130]

which the Court received on April 2, 2012

1.

it had submitted the required documents and studies to respondent DENR-EMB RVI before an ECC was issued in its favor;

2.

it had substantially complied with the requirements provided under PRA Administrative Order 2007-2, which compliance caused respondent PRAs Board to approve the reclamation project; and

3.

it had conducted a series of consultative [presentations] relative to the reclamation project before the LGU of Malay Municipality, the Barangay Officials of Caticlan, and stakeholders of Boracay Island.

Respondent Province further manifested that the Barangay Council of Caticlan, Malay, Aklan enacted on February 13, 2012 Resolution No. 003, series of 2012, entitled Resolution Favorably Endorsing the 2.6 Hectares Reclamation/MARINA Project of the Aklan Provincial Government at Catic lan Coastline
[131]

and that the Sangguniang

Bayan of the Municipality of Malay, Aklan enacted Resolution No. 020, series of 2012, entitled Resolution Endorsing the 2.6 Hectares Reclamation Project of the Provincial Government of Aklan Located at Barangay Caticlan, Malay, Aklan.
[132]

Respondent Province claims that its compliance with the requirements of respondents DENR-EMB RVI and PRA that led to the approval of the reclamation project by the said government agencies, as well as the recent enactments of the Barangay Council of Caticlan and the Sangguniang Bayan of the Municipality of Malay favorably endorsing the said project, had categorically addressed all the issues raised by the Petitioner in its Petition dated June 1, 2011. Respondent Province prays as follows:

WHEREFORE, premises considered, it is most respectfully prayed of this Honorable Court that after due proceedings, the following be rendered:

1.

The Temporary Environmental Protection Order (TEPO) it issued on June 7, 2011 be lifted/dissolved. The instant petition be dismissed for being moot and academic. Respondent Province of Aklan prays for such other reliefs that are just and equitable under the premises. (Emphases in the original.)

2. 3.

ISSUES

The Court will now resolve the following issues:

I. II.

Whether or not the petition should be dismissed for having been rendered moot and academic Whether or not the petition is premature because petitioner failed to exhaust administrative remedies before filing this case

III.

Whether or not respondent Province failed to perform a full EIA as required by laws and regulations based on the scope and classification of the project Whether or not respondent Province complied with all the requirements under the pertinent laws and regulations Whether or not there was proper, timely, and sufficient public consultation for the project DISCUSSION

IV.

V.

On the issue of whether or not the Petition should be dismissed for having been rendered moot and academic

Respondent Province claims in its Manifestation and Motion filed on April 2, 2012 that with the alleged favorable endorsement of the reclamation project by the Sangguniang Barangay of Caticlan and the Sangguniang Bayan of the Municipality of Malay, all the issues raised by petitioner had already been addressed, and this petition should be dismissed for being moot and academic.

On the contrary, a close reading of the two LGUs respective resolutions would reveal that they are not sufficient to render the petition moot and academic, as there are explicit conditions imposed that must be complied with by respondent Province. In Resolution No. 003, series of 2012, of the Sangguniang Barangay of Caticlan it is stated that any vertical structures to be constructed shall be subject for barangay endorsement.
[133]

Clearly, what

the barangay endorsed was the reclamation only, and not the entire project that includes the construction of a commercial building and wellness center, and other tourism-related facilities. Petitioners objections, as may be recalled, pertain not only to the reclamation per se, but also to the building to be constructed and the entire projects perceived ill effects to the surrounding environment.

Resolution No. 020, series of 2012, of the Sangguniang Bayan of Malay

[134]

is even more specific. It reads in part:

WHEREAS, noble it seems the reclamation project to the effect that it will generate scores of benefits for the Local Government of Malay in terms of income and employment for its constituents, but the fact cannot be denied that the project will take its toll on the environment especially on the nearby fragile island of Boracay and the fact also remains that the project will eventually displace the local transportation operators/cooperatives;

WHEREAS, considering the sensitivity of the project, this Honorable Body through the Committee where this matter was referred conducted several consultations/committee hearings with concerned departments and the private sector specifically Boracay Foundation, Inc. and they are one in its belief that this Local Government Unit has never been against development so long as compliance with the law and proper procedures have been observed and that paramount consideration have been given to the environment lest we disturb the balance of nature to the end that progress will be brought to naught;

WHEREAS, time and again, to ensure a healthy intergovernmental relations, this August Body requires no less than transparency and faithful commitment from the Provincial Government of Aklan in the process of going through these improvements in the Municipality because it once fell prey to infidelities in matters of governance;

WHEREAS, as a condition for the grant of this endorsement and to address all issues and concerns, this Honorable Council necessitates a sincere commitment from the Provincial Government of Aklan to the end that:

1.

To allocate an office space to LGU-Malay within the building in the reclaimed area;

2.

To convene the Cagban and Caticlan Jetty Port Management Board before the resumption of the reclamation project;

3.

That the reclamation project shall be limited only to 2.6 hectares in Barangay Caticlan and not beyond;

4.

That the local transportation operators/cooperatives will not be displaced; and

5.

The Provincial Government of Aklan conduct a simultaneous comprehensive study on the environmental impact of the reclamation project especially during Habagat and Amihan seasons and put in place as early as possible mitigating measures on the effect of the project to the environment.

WHEREAS, having presented these stipulations, failure to comply herewith will leave this August Body no choice but to revoke this endorsement, hence faithful compliance of the [135] commitment of the Provincial Government is highly appealed for[.] (Emphases added.)

The Sangguniang Bayan of Malay obviously imposed explicit conditions for respondent Province to comply with on pain of revocation of its endorsement of the project, including the need to conduct a comprehensive study on the environmental impact of the reclamation project, which is the heart of the petition before us. Therefore, the contents of the two resolutions submitted by respondent Province do not support its conclusion that the subsequent favorable endorsement of the LGUs had already addressed all the issues raised and rendered the instant petition moot and academic.

On the issue of failure to exhaust administrative remedies

Respondents, in essence, argue that the present petition should be dismissed for petitioners failure to exhaust administrative remedies and even to observe the hierarchy of courts. Furthermore, as the petition questions the issuance of the ECC and the NTP, this involves factual and technical verification, which are more properly within the expertise of the concerned government agencies.

Respondents anchor their argument on Section 6, Article II of DENR DAO 2003-30, which provides:

Section 6. Appeal

Any party aggrieved by the final decision on the ECC / CNC applications may, within 15 days from receipt of such decision, file an appeal on the following grounds:

a.

Grave abuse of discretion on the part of the deciding authority, or

b.

Serious errors in the review findings.

The DENR may adopt alternative conflict/dispute resolution procedures as a means to settle grievances between proponents and aggrieved parties to avert unnecessary legal action. Frivolous appeals shall not be countenanced.

The proponent or any stakeholder may file an appeal to the following:

Deciding Authority EMB Regional Office Director EMB Central Office Director DENR Secretary (Emphases supplied.)

Where to file the appeal Office of the EMB Director Office of the DENR Secretary Office of the President

Respondents argue that since there is an administrative appeal provided for, then petitioner is duty bound to observe the same and may not be granted recourse to the regular courts for its failure to do so.

We do not agree with respondents appreciation of the applicability of the rule on exhaustion of administrative remedies in this case. We are reminded of our ruling in Pagara v. Court of Appeals,
[136]

which summarized our earlier

decisions on the procedural requirement of exhaustion of administrative remedies, to wit:

The rule regarding exhaustion of administrative remedies is not a hard and fast rule. It is not applicable (1) where the question in dispute is purely a legal one, or (2) where the controverted act is patently illegal or was performed without jurisdiction or in excess of jurisdiction; or (3) where the respondent is a department secretary, whose acts as an alter ego of the President bear the implied or assumed approval of the latter, unless actually disapproved by him, or (4) where there are circumstances indicating the urgency of judicial intervention , -Gonzales vs. Hechanova, L-21897, October 22, 1963, 9 SCRA 230; Abaya vs. Villegas, L-25641, December 17, 1966, 18 SCRA; Mitra vs. Subido, L-21691, September 15, 1967, 21 SCRA 127.

Said principle may also be disregarded when it does not provide a plain, speedy and adequate remedy, (Cipriano vs. Marcelino, 43 SCRA 291), when there is no due process observed (Villanos vs. Subido, 45 SCRA 299), or where the protestant has no other recourse (Sta. [137] Maria vs. Lopez, 31 SCRA 637). (Emphases supplied.)

As petitioner correctly pointed out, the appeal provided for under Section 6 of DENR DAO 2003-30 is only applicable, based on the first sentence thereof, if the person or entity charged with the duty to exhaust the administrative remedy of appeal to the appropriate government agency has been a party or has been made a party in the proceedings wherein the decision to be appealed was rendered. It has been established by the facts that petitioner was never made a party to the proceedings before respondent DENR-EMB RVI. Petitioner was only informed that the project had already been approved after the ECC was already granted.
[138]

Not being a party to the said proceedings, it does not

appear that petitioner was officially furnished a copy of the decision, from which the 15-day period to appeal should be reckoned, and which would warrant the application of Section 6, Article II of DENR DAO 2003-30.

Although petitioner was not a party to the proceedings where the decision to issue an ECC was rendered, it stands to be aggrieved by the decision,
[139]

because it claims that the reclamation of land on the Caticlan side would

unavoidably adversely affect the Boracay side, where petitioners members own establishments engaged in the tourism trade. As noted earlier, petitioner contends that the declared objective of the reclamation project is to exploit Boracays tourism trade because the project is intended to enhance support services thereto; however, this objective would not be achieved since the white-sand beaches for which Boracay is famous might be negatively affected by the project. Petitioners conclusion is that respondent Province, aided and abetted by respondents PRA and DENR -EMB RVI, ignored the spirit and letter of our environmental laws, and should thus be compelled to perform their duties under said laws.

The new Rules of Procedure for Environmental Cases, A.M. No. 09-6-8-SC, provides a relief for petitioner under the writ of continuing mandamus, which is a special civil action that may be availed of to compel the performance of an act specifically enjoined by law issuance of the writ itself.
[141] [140]

and which provides for the issuance of a TEPO as an auxiliary remedy prior to the

The Rationale of the said Rules explains the writ in this wise:

Environmental law highlights the shift in the focal-point from the initiation of regulation by Congress to the implementation of regulatory programs by the appropriate government agencies.

Thus, a government agencys inaction, if any, has serious implications on the futur e of environmental law enforcement. Private individuals, to the extent that they seek to change the scope of the regulatory process, will have to rely on such agencies to take the initial incentives, which may require a judicial component. Accordingly, questions regarding the propriety of an agencys action or inaction will need to be analyzed.

This point is emphasized in the availability of the remedy of the writ of mandamus, which allows for the enforcement of the conduct of the tasks to which the writ pertains: the performance of a legal [142] duty. (Emphases added.)

The writ of continuing mandamus permits the court to retain jurisdiction after judgment in order to ensure the successful implementation of the reliefs mandated under the courts decision and, in order to do this, the court may compel the submission of compliance reports from the respondent government agencies as well as avail of other means to monitor compliance with its decision.
[143]

According to petitioner, respondent Province acted pursuant to a MOA with respondent PRA that was conditioned upon, among others, a properly-secured ECC from respondent DENR-EMB RVI. For this reason, petitioner seeks to compel respondent Province to comply with certain environmental laws, rules, and procedures that it claims were either circumvented or ignored. Hence, we find that the petition was appropriately filed with this Court under Rule 8, Section 1, A.M. No. 09-6-8-SC, which reads:

SECTION 1. Petition for continuing mandamus.When any agency or instrumentality of the government or officer thereof unlawfully neglects the performance of an act which the law specifically enjoins as a duty resulting from an office, trust or station in connection with the enforcement or violation of an environmental law rule or regulation or a right therein, or unlawfully excludes another from the use or enjoyment of such right and there is no other plain, speedy and adequate remedy in the ordinary course of law, the person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty, attaching thereto supporting evidence, specifying that the petition concerns an environmental law, rule or regulation, and praying that judgment be rendered commanding the respondent to do an act or series of acts until the judgment is fully satisfied, and to pay damages sustained by the petitioner by reason of the malicious neglect to perform the duties of the respondent, under the law, rules or regulations. The petition shall also contain a sworn certification of non-forum shopping.

SECTION 2. Where to file the petition.The petition shall be filed with the Regional Trial Court exercising jurisdiction over the territory where the actionable neglect or omission occurred or with the Court of Appeals or the Supreme Court.

Petitioner had three options where to file this case under the rule: the Regional Trial Court exercising jurisdiction over the territory where the actionable neglect or omission occurred, the Court of Appeals, or this Court.

Petitioner had no other plain, speedy, or adequate remedy in the ordinary course of law to determine the questions of unique national and local importance raised here that pertain to laws and rules for environmental protection, thus it was justified in coming to this Court.

Having resolved the procedural issue, we now move to the substantive issues.

On the issues of whether, based on the scope and classification of the project, a full EIA is required by laws and regulations, and whether respondent Province complied with all the requirements under the pertinent laws and regulations

Petitioners arguments on this issue hinges upon its claim that the reclamation project is misclassified as a single project when in fact it is co-located. Petitioner also questions the classification made by respondent Province that the reclamation project is merely an expansion of the existing jetty port, when the project descriptions embodied in the different documents filed by respondent Province describe commercial establishments to be built, among others, to raise revenues for the LGU; thus, it should have been classified as a new project. Petitioner likewise cries foul to the manner by which respondent Province allegedly circumvented the documentary requirements of the DENR-EMB RVI by the act of connecting the reclamation project with its previous project in 1999 and claiming that the new project is a mere expansion of the previous one.

As previously discussed, respondent Province filed a Manifestation and Motion stating that the ECC issued by respondent DENR-EMB RVI covered an area of 2,691 square meters in Caticlan, and its application for reclamation of 40 hectares with respondent PRA was conditioned on its submission of specific documents within 120 days. Respondent Province claims that its failure to comply with said condition indicated its waiver to pursue the succeeding phases of the reclamation project and that the subject matter of this case had thus been limited to 2.64 hectares. Respondent PRA, for its part, declared through its General Manager that the Aklan Beach Zone Restoration and Protection Marine Development Project will now be confined to the reclamation and development of the 2.64 hectares, more or less.
[144]

The Court notes such manifestation of respondent Province. Assuming, however, that the area involved in the subject reclamation project has been limited to 2.64 hectares, this case has not become moot and academic, as alleged by respondents, because the Court still has to check whether respondents had complied with all applicable environmental laws, rules, and regulations pertaining to the actual reclamation project.

We recognize at this point that the DENR is the government agency vested with delegated powers to review and evaluate all EIA reports, and to grant or deny ECCs to project proponents.
[145]

It is the DENR that has the duty to

implement the EIS system. It appears, however, that respondent DENR-EMB RVIs evaluation of this reclamation project was problematic, based on the valid questions raised by petitioner.

Being the administrator of the EIS System, respondent DENR-EMB RVIs submissions bear great weight in this case. However, the following are the issues that put in question the wisdom of respondent DENR-EMB RVI in issuing the ECC:

1.

Its approval of respondent Provinces classification of the proje ct as a mere expansion of the existing jetty port in Caticlan, instead of classifying it as anew project;

2. 3. 4.

Its classification of the reclamation project as a single instead of a co-located project; The lack of prior public consultations and approval of local government agencies; and The lack of comprehensive studies regarding the impact of the reclamation project to the environment.

The above issues as raised put in question the sufficiency of the evaluation of the project by respondent DENREMB RVI.

Nature of the project

The first question must be answered by respondent DENR-EMB RVI as the agency with the expertise and authority to state whether this is a new project, subject to the more rigorous environmental impact study requested by petitioner, or it is a mere expansion of the existing jetty port facility.

The second issue refers to the classification of the project by respondent Province, approved by respondent DENR-EMB RVI, as single instead of co-located. Under the Revised Procedural Manual, the Summary List of Additional Non-Environmentally-Critical Project (NECP) Types in ECAs Classified under Group II (Table I -2) lists buildings, storage facilities and other structures as a separate item from transport terminal facilities. This creates the question of whether this project should be considered as consisting of more than one type of activity, and should more properly be classified as co-located, under the following definition from the same Manual, which reads:

f)

Group IV (Co-located Projects in either ECA or NECA): A co-located project is a group of single projects, under one or more proponents/locators, which are located in a contiguous area and managed by one administrator, who is also the ECC applicant. The co-located project may be an economic zone or industrial park, or a mix of projects within a catchment, watershed or river basin, or any other geographical, political or economic unit of area. Since the location or threshold of specific projects within the contiguous area will yet be derived from the EIA process based on the carrying capacity of the project environment, the nature of the project is called programmatic. (Emphasis added.)

Respondent DENR-EMB RVI should conduct a thorough and detailed evaluation of the project to address the question of whether this could be deemed as a group of single projects (transport terminal facility, building, etc.) in a contiguous area managed by respondent Province, or as a single project.

The third item in the above enumeration will be discussed as a separate issue.

The answer to the fourth question depends on the final classification of the project under items 1 and 3 above because the type of EIA study required under the Revised Procedural Manual depends on such classification.

The very definition of an EIA points to what was most likely neglected by respondent Province as project proponent, and what was in turn overlooked by respondent DENR-EMB RVI, for it is defined as follows:

An [EIA] is a process that involves predicting and evaluating the likely impacts of a project (including cumulative impacts) on the environment during construction, commissioning, operation and abandonment. It also includes designing appropriate preventive, mitigating and enhancement measures addressing these [146] consequences to protect the environment and the communitys welfare. (Emphases supplied.)

Thus, the EIA process must have been able to predict the likely impact of the reclamation project to the environment and to prevent any harm that may otherwise be caused.

The project now before us involves reclamation of land that is more than five times the size of the original reclaimed land. Furthermore, the area prior to construction merely contained a jetty port, whereas the proposed expansion, as described in the EPRMP submitted by respondent Province to respondent DENR-EMB RVI involves so much more, and we quote:

The expansion project will be constructed at the north side of the existing jetty port and terminal that will have a total area of 2.64 hectares, more or less, after reclamation. The Phase 1 of the project construction costing around P260 million includes the following:

1.

Reclamation

- 3,000 sq m (expansion of jetty port)

2.

Reclamation

- 13,500 sq m (buildable area)

3.

Terminal annex building

- 250 sq m

4.

2-storey commercial building 2,500 sq m (1,750 sq m of leasable space)

5.

Health and wellness center

6.

Access road

- 12 m (wide)

7.

Parking, perimeter fences, lighting and water treatment sewerage system

8.

Rehabilitation of existing jetty port and terminal

xxxx

The succeeding phases of the project will consist of [further] reclamation, completion of the commercial center building, bay walk commercial strip, staff building, ferry terminal, a cable car system and wharf marina. This will entail an additional estimated cost of P785 million bringing the total investment [147] requirement to about P1.0 billion. (Emphases added.)

As may be gleaned from the breakdown of the 2.64 hectares as described by respondent Province above, a significant portion of the reclaimed area would be devoted to the construction of a commercial building, and the area to be utilized for the expansion of the jetty port consists of a mere 3,000 square meters (sq. m). To be true to its definition, the EIA report submitted by respondent Province should at the very least predict the impact that the construction of the new buildings on the reclaimed land would have on the surrounding environment. These new constructions and their environmental effects were not covered by the old studies that respondent Province previously submitted for the construction of the original jetty port in 1999, and which it re-submitted in its application for ECC in this alleged expansion, instead of conducting updated and more comprehensive studies.

Any impact on the Boracay side cannot be totally ignored, as Caticlan and Boracay are separated only by a narrow strait. This becomes more imperative because of the significant contributions of Boracays white -sand beach to the countrys tourism trade, which requires respondent Province to proceed with utmost caution in implementing projects within its vicinity.

We had occasion to emphasize the duty of local government units to ensure the quality of the environment under Presidential Decree No. 1586 in Republic of the Philippines v. The City of Davao ,
[148]

wherein we held:

Section 15 of Republic Act 7160, otherwise known as the Local Government Code, defines a local government unit as a body politic and corporate endowed with powers to be exercised by it in conformity with law. As such, it performs dual functions, governmental and proprietary. Governmental functions are those that concern the health, safety and the advancement of the public good or welfare as affecting the public generally. Proprietary functions are those that seek to obtain special corporate benefits or earn pecuniary profit and intended for private advantage and benefit. When exercising governmental powers and performing governmental duties, an LGU is an agency of the national government. When engaged in corporate activities, it acts as an agent of the community in the administration of local affairs. Found in Section 16 of the Local Government Code is the duty of the LGUs to promote the peoples right to a balanced ecology. Pursuant to this, an LGU, like the City of Davao, can not claim exemption from the coverage of PD 1586. As a body politic endowed with governmental functions, an LGU has the duty to ensure the quality of the environment, which is the very same objective of PD 1586. xxxx Section 4 of PD 1586 clearly states that no person, partnership or corporation shall undertake or operate any such declared environmentally critical project or area without first securing an Environmental Compliance Certificate issued by the President or his duly authorized representative. The Civil Code defines a person as either natural or juridical. The state and its political subdivisions, i.e., the local government units are juridical persons. Undoubtedly therefore, local government units are not excluded from the coverage of PD 1586. Lastly, very clear in Section 1 of PD 1586 that said law intends to implement the policy of the state to achieve a balance between socio-economic development and environmental protection, which are the twin goals of sustainable development. The above-quoted first paragraph of the Whereas clause stresses that this can only be possible if we adopt a comprehensive and integrated environmental protection program where all the sectors of the community are involved, i.e., the government and the private sectors. The local government units, as part of the machinery of the government, cannot therefore be deemed as outside the scope of the EIS [149] system. (Emphases supplied.)

The Court chooses to remand these matters to respondent DENR-EMB RVI for it to make a proper study, and if it should find necessary, to require respondent Province to address these environmental issues raised by petitioner and submit the correct EIA report as required by the projects specifications. The Court requires respondent DENR-EMB RVI to complete its study and submit a report within a non-extendible period of three months. Respondent DENR-EMB RVI should establish to the Court in said report why the ECC it issued for the subject project should not be canceled.

Lack of prior public consultation

The Local Government Code establishes the duties of national government agencies in the maintenance of ecological balance, and requires them to secure prior public consultation and approval of local government units for the projects described therein.

In the case before us, the national agency involved is respondent PRA. Even if the project proponent is the local government of Aklan, it is respondent PRA which authorized the reclamation, being the exclusive agency of the government to undertake reclamation nationwide. Hence, it was necessary for respondent Province to go through respondent PRA and to execute a MOA, wherein respondent PRAs authority to reclaim was delegated to respondent Province. Respondent DENR-EMB RVI, regional office of the DENR, is also a national government institution which is tasked with the issuance of the ECC that is a prerequisite to projects covered by environmental laws such as the one at bar.

This project can be classified as a national project that affects the environmental and ecological balance of local communities, and is covered by the requirements found in the Local Government Code provisions that are quoted below:

Section 26. Duty of National Government Agencies in the Maintenance of Ecological Balance. - It shall be the duty of every national agency or government-owned or controlled corporation authorizing or involved in the planning and implementation of any project or program that may cause pollution, climatic change, depletion of non-renewable resources, loss of crop land, rangeland, or forest cover, and extinction of animal or plant species, to consult with the local government units, nongovernmental organizations, and other sectors concerned and explain the goals and objectives of the project or program, its impact upon the people and the community in terms of environmental or ecological balance, and the measures that will be undertaken to prevent or minimize the adverse effects thereof.

Section 27. Prior Consultations Required. - No project or program shall be implemented by government authorities unless the consultations mentioned in Sections 2 (c) and 26 hereof are complied with, and prior approval of the sanggunian concerned is obtained: Provided, That occupants in areas where such projects are to be implemented shall not be evicted unless appropriate relocation sites have been provided, in accordance with the provisions of the Constitution.

In Lina, Jr. v. Pao,

[150]

we held that Section 27 of the Local Government Code applies only to national programs
[151]

and/or projects which are to be implemented in a particular local community with Section 26. We held further in this manner:

and that it should be read in conjunction

Thus, the projects and programs mentioned in Section 27 should be interpreted to mean projects and programs whose effects are among those enumerated in Section 26 and 27, to wit, those that: (1) may cause pollution; (2) may bring about climatic change; (3) may cause the depletion of nonrenewable resources; (4) may result in loss of crop land, range-land, or forest cover; (5) may eradicate certain animal or plant species from the face of the planet; and (6) other projects or programs that may call for the eviction of a particular group of people residing in the locality where these will be implemented. Obviously, none of these effects will be produced by the introduction of lotto in the province of [152] Laguna. (Emphasis added.)

During the oral arguments held on September 13, 2011, it was established that this project as described above falls under Section 26 because the commercial establishments to be built on phase 1, as described in the EPRMP quoted above, could cause pollution as it could generate garbage, sewage, and possible toxic fuel discharge.
[153]

Our ruling in Province of Rizal v. Executive Secretary

[154]

is instructive:

We reiterated this doctrine in the recent case of Bangus Fry Fisherfolk v. Lanzanas, where we held that there was no statutory requirement for the sangguniang bayan of Puerto Galera to approve the construction of a mooring facility, as Sections 26 and 27 are inapplicable to projects which are not environmentally critical.

Moreover, Section 447, which enumerates the powers, duties and functions of the municipality, grants the sangguniang bayan the power to, among other things, enact ordinances, approve resolutions and appropriate funds for the general welfare of the municipality and its inhabitants pursuant to Section 16 of th(e) Code. These include:

(1)

Approving ordinances and passing resolutions to protect the environment and impose appropriate penalties for acts which endanger the environment, such as dynamite fishing and other forms of destructive fishing, illegal logging and smuggling of logs, smuggling of natural resources products and of endangered species of flora and fauna, slash and burn farming, and such other activities which result in pollution, acceleration of eutrophication of rivers and lakes, or of ecological imbalance; [Section 447 (1)(vi)]

(2)

Prescribing reasonable limits and restraints on the use of property within the jurisdiction of the municipality, adopting a comprehensive land use plan for the municipality, reclassifying land within the jurisdiction of the city, subject to the pertinent provisions of this Code, enacting integrated zoning ordinances in consonance with the approved comprehensive land use plan, subject to existing laws, rules and regulations; establishing fire limits or zones, particularly in populous centers; and regulating the construction, repair or modification of buildings within said fire limits or zones in accordance with the provisions of this Code; [Section 447 (2)(vi-ix)]

(3)

Approving ordinances which shall ensure the efficient and effective delivery of the basic services and facilities as provided for under Section 17 of this Code, and in addition to said services and facilities, providing for the establishment, maintenance, protection, and conservation of communal forests and watersheds, tree parks, greenbelts, mangroves, and other similar forest development projects and, subject to existing laws, establishing and providing for the maintenance, repair and operation of an efficient waterworks system to supply water for the inhabitants and purifying the source of the

water supply; regulating the construction, maintenance, repair and use of hydrants, pumps, cisterns and reservoirs; protecting the purity and quantity of the water supply of the municipality and, for this purpose, extending the coverage of appropriate ordinances over all territory within the drainage area of said water supply and within one hundred (100) meters of the reservoir, conduit, canal, aqueduct, pumping station, or watershed used in connection with the water service; and regulating the consumption, use or wastage of water. [Section 447 (5)(i) & (vii)]

Under the Local Government Code, therefore, two requisites must be met before a national project that affects the environmental and ecological balance of local communities can be implemented: prior consultation with the affected local communities, and prior approval of the project by the appropriate sanggunian. Absent either of these mandatory requirements, the [155] projects implementation is illegal. (Emphasis added.)

Based on the above, therefore, prior consultations and prior approval are required by law to have been conducted and secured by the respondent Province. Accordingly, the information dissemination conducted months after the ECC had already been issued was insufficient to comply with this requirement under the Local Government Code. Had they been conducted properly, the prior public consultation should have considered the ecological or environmental concerns of the stakeholders and studied measures alternative to the project, to avoid or minimize adverse environmental impact or damage. In fact, respondent Province once tried to obtain the favorable endorsement of the Sangguniang Bayan of Malay, but this was denied by the latter.

Moreover, DENR DAO 2003-30 provides:

5.3

Public Hearing / Consultation Requirements

For projects under Category A-1, the conduct of public hearing as part of the EIS review is mandatory unless otherwise determined by EMB. For all other undertakings, a public hearing is not mandatory unless specifically required by EMB.

Proponents should initiate public consultations early in order to ensure that environmentally relevant concerns of stakeholders are taken into consideration in the EIA study and the formulation of the management plan . All public consultations and public hearings conducted during the EIA process are to be documented. The public hearing/consultation Process report shall be validated by the EMB/EMB RD and shall constitute part of the records of the EIA process. (Emphasis supplied.)

In essence, the above-quoted rule shows that in cases requiring public consultations, the same should be initiated early so that concerns of stakeholders could be taken into consideration in the EIA study. In this case, respondent Province had already filed its ECC application before it met with the local government units of Malay and Caticlan.

The claim of respondent DENR-EMB RVI is that no permits and/or clearances from National Government Agencies (NGAs) and LGUs are required pursuant to the DENR Memorandum Circular No. 2007-08. However, we still find that the LGC requirements of consultation and approval apply in this case. This is because a Memorandum Circular cannot prevail over the Local Government Code, which is a statute and which enjoys greater weight under our hierarchy of laws.

Subsequent to the information campaign of respondent Province, the Municipality of Malay and the Liga ng mga Barangay-Malay Chapter still opposed the project. Thus, when respondent Province commenced the implementation project, it violated Section 27 of the LGC, which clearly enunciates that [no] project or program shall be implemented by government authorities unless the consultations mentioned in Sections 2(c) and 26 hereof are complied with, and prior approval of thesanggunian concerned is obtained.

The lack of prior public consultation and approval is not corrected by the subsequent endorsement of the reclamation project by the Sangguniang Barangay of Caticlan on February 13, 2012, and the Sangguniang Bayan of the Municipality of Malay on February 28, 2012, which were both undoubtedly achieved at the urging and insistence of respondent Province. As we have established above, the respective resolutions issued by the LGUs concerned did not render this petition moot and academic.

It is clear that both petitioner and respondent Province are interested in the promotion of tourism in Boracay and the protection of the environment, lest they kill the proverbial hen that lays the golden egg. At the beginning of this decision, we mentioned that there are common goals of national significance that are very apparent from both the petitioners and the respondents respective pleadin gs and memoranda.

The parties are evidently in accord in seeking to uphold the mandate found in Article II, Declaration of Principles and State Policies, of the 1987 Constitution, which we quote below:

SECTION 16. The State shall protect and advance the right of the people to a balanced and healthful ecology in accord with the rhythm and harmony of nature. xxxx SECTION 20. The State recognizes the indispensable role of the private sector, encourages private enterprise, and provides incentives to needed investments.

The protection of the environment in accordance with the aforesaid constitutional mandate is the aim, among others, of Presidential Decree No. 1586, Establishing an Environmental Impact Statement System, Including Other Environmental Management Related Measures and For Other Purposes, which declared in its first Section that it is the policy of the State to attain and maintain a rational and orderly balance between socio-economic growth and environmental protection.

The parties undoubtedly too agree as to the importance of promoting tourism, pursuant to Section 2 of Republic Act No. 9593, or The Tourism Act of 2009, which reads:

SECTION 2. Declaration of Policy. The State declares tourism as an indispensable element of the national economy and an industry of national interest and importance , which must be harnessed as an engine of socioeconomic growth and cultural affirmation to generate investment, foreign exchange and employment, and to continue to mold an enhanced sense of national pride for all Filipinos. (Emphasis ours.)

The primordial role of local government units under the Constitution and the Local Government Code of 1991 in the subject matter of this case is also unquestionable. The Local Government Code of 1991 (Republic Act No. 7160) pertinently provides:

Section 2. Declaration of Policy. - (a) It is hereby declared the policy of the State that the territorial and political subdivisions of the State shall enjoy genuine and meaningful local autonomy to enable them to attain their fullest development as self-reliant communities and make them more effective partners in the attainment of national goals. Toward this end, the State shall provide for a more responsive and accountable local government structure instituted through a system of decentralization whereby local government units shall be given more powers, authority, responsibilities, and resources. The process of decentralization shall proceed from the national [156] government to the local government units. (Emphases ours.)

As shown by the above provisions of our laws and rules, the speedy and smooth resolution of these issues would benefit all the parties. Thus, respondent Provinces cooperation with responden t DENR-EMB RVI in the Court-mandated review of the proper classification and environmental impact of the reclamation project is of utmost importance.

WHEREFORE, premises considered, the petition is hereby PARTIALLY GRANTED. The TEPO issued by this Court is hereby converted into a writ of continuing mandamus specifically as follows:

1.

Respondent Department of Environment and Natural Resources-Environmental Management Bureau Regional Office VI shall revisit and review the following matters:

a. b.

its classification of the reclamation project as a single instead of a co-located project; its approval of respondent Provinces classification of the project as a mere expansion of the existing jetty port in Caticlan, instead of classifying it as a new project; and

c.

the impact of the reclamation project to the environment based on new, updated, and comprehensive studies, which should forthwith be ordered by respondent DENR-EMB RVI.

2.

Respondent Province of Aklan shall perform the following:

a.

fully cooperate with respondent DENR-EMB RVI in its review of the reclamation project proposal and submit to the latter the appropriate report and study; and

b.

secure approvals from local government units and hold proper consultations with nongovernmental organizations and other stakeholders and sectors concerned as required by Section 27 in relation to Section 26 of the Local Government Code.

3. Respondent Philippine Reclamation Authority shall closely monitor the submission by respondent Province of the requirements to be issued by respondent DENR-EMB RVI in connection to the environmental concerns raised by petitioner, and shall coordinate with respondent Province in modifying the MOA, if necessary, based on the findings of respondent DENR-EMB RVI.

4.

The petitioner Boracay Foundation, Inc. and the respondents The Province of Aklan, represented by Governor Carlito S. Marquez, The Philippine Reclamation Authority, and The DENR-EMB (Region VI) are mandated to submit their respective reports to this Court regarding their compliance with the requirements set forth in this Decision no later than three (3) months from the date of promulgation of this Decision.

5.

In the meantime, the respondents, their concerned contractor/s, and/or their agents, representatives or persons acting in their place or stead, shall immediately cease and desist from continuing the implementation of the project covered by ECC-R6-1003-096-7100 until further orders from this

Court. For this purpose, the respondents shall report within five (5) days to this Court the status of the project as of their receipt of this Decision, copy furnished the petitioner.

This Decision is immediately executory.

SO ORDERED.

TERESITA J. LEONARDO-DE CASTRO Associate Justice

WE CONCUR:

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. 160932 January 14, 2013 SPECIAL PEOPLE, INC. FOUNDATION, REPRESENTED BY ITS CHAIRMAN, ROBERTO P. CERICOS, Petitioner, vs. NESTOR M. CANDA, BIENVENIDO LIPA YON, JULIAN D. AMADOR, BOHOL PROVINCIAL CHIEF, REGIONAL DIRECTOR, AND NATIONAL DIRECTOR, RESPECTIVELY, ENVIRONMENTAL MANAGEMENT BUREAU, DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, AND THE SECRETARY OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES, ALL SUED IN BOTH THEIR OFFICIAL AND PRIVATE CAPACITIES, Respondents. DECISION BERSAMIN, J.: The peremptory writ of mandamus is an extraordinary remedy that is issued only in extreme necessity, and the ordinary course of procedure is powerless to afford an adequate and speedy relief to one who has a clear legal right to the performance of the act to be compelled. Antecedents The petitioner was a proponent of a water-resource development and utilization project in Barangay Jimilia-an in the Municipality of Loboc, Bohol that would involve the tapping and purifying of water from the Loboc River, and the distribution of the purified water to the residents of Loboc and six other municipalities. The petitioner applied for a Certificate of Non-Coverage (CNC) with the Environmental Management Bureau (EMB) of the Department of Environment and Natural Resources (DENR), Region 7, seeking to be exempt from the requirement of the Environmental Compliance Certificate (ECC) under Section 4 of Presidential Decree No. 1586 on the following justifications, to wit: 1) The whole project simply involves tapping of water from the Loboc River, filtering and purifying it, and distributing the same to the consumers in the covered towns; 2) From the source to the filtration plant, then to the purifier stations, then finally to the consum ers households, water flows through steel pipes; 3) The filtration and purifying process employs the latest technology"electrocatalytic"internationally accepted for safety and environment friendliness; 4) No waste is generated, as the electrocatalytic process dissolves all impurities in the water;

5) The project involves no destruction [n]or harm to the environment. On the other hand, it is environment 1 friendly. Upon evaluating the nature and magnitude of the environmental impact of the project, respondent Nestor M. Canda, then Chief of EMB in Bohol, rendered his findings in a letter dated December 4, 2001, as follows: 1) The project is located within a critical area; hence, Initial Environmental Examination is required. 2) The project is socially and politically sensitive therefore proof of social acceptability should be established. 2 Proper indorsement from the Protected Area Management Bureau or PAMB should be secured. (Emphasis supplied) On January 11, 2002, the petitioner appealed Candas findings to respondent EMB Region 7 Director Bienvenido L. Lipayon (RD Lipayon), claiming that it should also be issued a CNC because the project was no different from the LobocLoay waterworks project of the Department of Public Works and Highways (DPWH) that had recently been issued a 3 CNC. On April 3, 2002, RD Lipayon notified the petitioner that its documents substantially complied with the procedural aspects of the EMBs review, and that the application was assigned EMB-DENR-7 Control No. CNC-02-080 for easy reference in 4 case of follow-up and submission of additional requirements. Later on, RD Lipayon informed the petitioner that an Initial Environmental Examination document was required for the 5 project due to its significant impact in the area. On August 26, 2002, RD Lipayon required the petitioner to submit the following documents to enable the EMB to determine whether the project was within an environmentally critical area or not, to wit: 1. Certification from DENR, Provincial Environment and Natural Resources Office (PENRO) that it is not within areas declared by law as national parks, watershed reserves, wildlife preservation area, sanctuaries and not within the purview of Republic Act No. 7586 or the National Integrated Protected Areas System (NIPAS) Act, and other issuances including international commitments and declarations; 2. Certification from the DENR Regional Office/ PENRO [that] the areas within the project do not constitute the habitat for any endangered or threatened species or indigenous wildlife (Flora and Fauna). 3. Certification from the following: 3.1. Philippine Atmospheric Geophysical and Astronomical Services Administration (PAGASA) that the area is not frequently visited or hard-hit by typhoons. This shall refer to all areas where typhoon signal no. 3 not hoisted for at least twice a year during the last five (5) years prior to the year of reckoning. Years to be considered shall be from January 1995 to December 2001. 3.2. Philippine Institute of Volcanology and Seismology (PHIVOLCS) that the area was not subjected to an earthquake of at least intensity VII in the Rossi-Forel scale or its equivalent and hit by tsunamis during the period of 1638 until the year 2001. 3.3. PHIVOLCS that the area was not subjected to earthquakes of at least intensity VII in the Rossi-Forel scale or its equivalent during the period of 1949 until the year 2001. 3.4. PAGASA that the area is not storm surge-prone. 3.5. Mines and Geosciences Bureau Region 7 (MGB 7) that the area is not located along fault lines or within fault zones and not located in critical slope. 3.6. City Mayor and/or City Engineers Office that the area is not flood prone. 3.7. Network of Protected Areas for Agriculture (NPAA) of the Bureau of Soils and Water Management (BSWM) that the area is not classified as Prime Agricultural Land. 4. Certification from the Provincial Tourism Office or its equivalent office that areas in your project are not setaside as aesthetic potential tourist spot. 5. Certification from the National Water Resources Board (NWRB) that areas within your project are not recharged areas of aquifer. 6. Certification from DENR regional Office and/or Environmental Management Bureau 7 (EMB 7) that Loboc River is not characterized by one or any combination of the following conditions: a. Tapped for domestic purposes; b. With controlled and/or protected areas declared by appropriate authorities; and c. Which support wildlife and fishery activities. A Certificate of Non-Coverage will duly be issued to your foundation once all the above mentioned required certifications are complied with. Projects that are covered by P.D. 1586 or the Environmental Impact System (EIS) Law should not start unless the Project Proponent should secure an Environmental Compliance Certificate (ECC), otherwise penalties shall be 6 imposed. (Emphases supplied) 7 On January 28, 2003, the petitioner submitted eight certifications, including the certification issued by the Philippine Institute of Volcanology and Seismology (PHIVOLCS), as follows: That the project area, Loboc, Bohol was subjected to an earthquake of Intensity VII in the adapted Rossi-Forel scale of IIX last February 8, 1990. The magnitude of the earthquake is 6.8 and the highest intensity reported was VIII, based on the Rossi-Forel Intensity Scale. During the said earthquake, the PMI Academy Building collapsed while minor cracks were sustained by the municipal hall, public school, town church and some other houses in the town. There were reports that immediately after the earthquake, the force of the incoming waves from the sea caused Alijuan River in the town of Duero

to flow inland. The report also states that the waves affected 10-50 meters of the coastal beach of the towns of Jagna, 8 Duero, Guindulman, Garcia Hernandez and Valencia. (Emphases supplied) The petitioner failed to secure a certification from the Regional Office of the Mines and Geosciences Bureau (RO-MGB) to the effect that the project area was not located along a fault line/fault zone or a critical slope because RO-MGB did not have the data and expertise to render such finding, and thus had to forward the petitioners request to the MGB Central 9 Office. Upon the MGBs advice, the petitioner sought and obtained the required certification from PHIVOLCS, but the certification did not state whether the project area was within a critical slope. Instead, the certification stated that the project site was 10 approximately 18 kilometers west of the East Bohol Fault. Given the tenor of the certification from PHIVOLCS, RD Lipayons letter dated February 4, 2003 declared that the project was within an environmentally critical area, and that the petitioner was not entitled to the CNC, viz: After thorough review of your submitted certifications, it was found out that the area was subjected to an earthquake of Intensity VII in the adapted Rossi-Forel scale wherein the magnitude of the earthquake is 6.8 with the highest intensity reported of VIII and you fail to support certification that the project area is not within critical slope. And based on the W ater Usage and Classification per Department Order (DAO) 34 Series of 1990, subject river system was officially classified as Class B intended for swimming and bathing purposes. Moreover, one component of your project involves opening of roadway connected to the barangay road. Therefore, we reiterate our previous stand that your project is covered by the EIS System pursuant to P.D. 1586, the 11 Environmental Impact Statement Law. On March 27, 2003, the petitioner filed a petition for mandamus and damages in the Regional Trial Court (RTC) in Loay, 12 Bohol, alleging that it was now entitled to a CNC as a matter of right after having complied with the certification requirements; and that the EMB had earlier issued a CNC to the DPWH for a similar waterworks project in the same area. 13 In the decision dated November 18, 2003, the RTC dismissed the petition for mandamus upon the following considerations, namely: (1) PHIVOLCS certified that the project site had been subjected to an Intensity VII earthquake in 1990; (2) the CNC issued by the EMB to a similar waterworks project of the DPWH in the same area was only for the construction of a unit spring box intake and pump house, and the DENR issued a cease and desist order relative to the DPWHs additional project to put up a water filtration plant therein; (3) the de termination of whether an area was environmentally critical was a task that pertained to the EMB; (4) the assignment of a control number by the EMB to the petitioners application did not mean that the application was as good as approved; (5) the RTC would not interfere with the primary prerogative of the EMB to review the merits of the petitioners application for the CNC; and (6) there was already a pending appeal lodged with the DENR Secretary. Hence, this appeal brought directly to the Court via petition for review on certiorari. Issues The petitioner submits the following issues: A. WHETHER OR NOT, AFTER PETITIONERS DUE COMPLIANCE WITH THE REQUIREMENTS MANDATED BY RESPONDENTS FOR THE ISSUANCE OF THE CERTIFICATE OF NON-COVERAGE (CNC) APPLIED FOR BY PETITIONER, IT IS NOW THE RIPENED DUTY OF RESPONDENTS, THROUGH RESPONDENT EMB REGIONAL DIRECTOR, TO ISSUE SAID DOCUMENT IN FAVOR OF PETITIONER; B. WHETHER OR NOT PETITIONER HAS EXHAUSTED AVAILABLE ADMINISTRATIVE REMEDIES THROUGH AN APPEAL TO RESPONDENT DENR SECRETARY WHO HAS SAT ON SAID APPEAL UP TO THE PRESENT; C. WHETHER OR NOT PETITIONER IS ENTITLED TO RECOVER DAMAGES FROM RESPONDENTS IN 14 THEIR PERSONAL CAPACITY. The petitioner insists that RD Lipayon already exercised his discretion by finding that the application substantially complied with the procedural aspects for review and by assigning Control No. CNC-02-080 to its application; that after the petitioner complied with the requirements enumerated in the August 26, 2002 letter of RD Lipayon, the EMB became dutybound to issue the CNC to the petitioner; that the EMB issued a CNC to a similar project of the DPWH in the same area; that it filed an appeal with the DENR Secretary, but the appeal remained unresolved; and that it brought the petition for mandamus precisely as a speedier recourse. In their comment, RD Lipayon and Canda aver that the act complained of against them involved an exercise of discretion that could not be compelled by mandamus; that the petitioners proposed project was located within an environmentally critical area, and the activities to be done were so significant that they would create massive earth movement and environmental degradation; that the petitioner violated the rule against forum shopping; and that the petitioner had no cause of action against them for failure to exhaust administrative remedies. On his part, the DENR Secretary, through the Solicitor General, contends that the petition raises questions of fact that are not proper in a petition for review; that the petitioner should have appealed to the CA under Rule 41 of the Rules of Court; that the grant or denial of a CNC application is discretionary and cannot be compelled by mandamus; and that the petitioner failed to exhaust administrative remedies. Accordingly, the Court is called upon to resolve, firstly, whether the appeal directly to this Court from the RTC was proper, and, secondly, whether the petition for mandamus was the correct recourse. Ruling The petition for review is denied for its lack of merit.

1. Petitioners appeal is improper under Rule 45, Rules of Court This appeal by certiorari is being taken under Rule 45, Rules of Court, whose Section 1 expressly requires that the petition shall raise only questions of law which must be distinctly set forth. Yet, the petitioner hereby raises a question of fact whose resolution is decisive in this appeal. That issue of fact concerns whether or not the petitioner established that its project was not located in an environmentally critical area. For this reason, the Court is constrained to deny due course to the petition for review. It is a settled rule, indeed, that in the exercise of our power of review, the Court is not a trier of facts and does not normally undertake the re-examination of the evidence presented by the contending parties during the trial of the case. The Court relies on the findings of fact of the Court of Appeals or of the trial court, and accepts such findings as conclusive and binding unless any of the following exceptions obtains, namely: (a) when the findings are grounded entirely on speculation, surmises or conjectures; (b) when the inference made is manifestly mistaken, absurd or impossible; (c) when there is grave abuse of discretion; (d) when the judgment is based on a misapprehension of facts; (e) when the findings of facts are conflicting; (f) when in making its findings the Court of Appeals or the trial court went beyond the issues of the case, or its findings are contrary to the admissions of both the appellant and the appellee; (g) when the findings are contrary to the trial court; (h) when the findings are conclusions without citation of specific evidence on which they are based; (i) when the facts set forth in the petition as well as in the petitioners main and reply briefs are not disputed by the respondent; (j) when the findings of fact are premised on the supposed absence of evidence and contradicted by the evidence on record; and (k) when the Court of Appeals or the trial court manifestly overlooked certain relevant facts not 15 disputed by the parties, which, if properly considered, would justify a different conclusion. However, none of the aforementioned exceptions applies herein. 2. Mandamus was an improper remedy for petitioner We dismiss the present recourse because the petitioner failed to exhaust the available administrative remedies, and because it failed to show that it was legally entitled to demand the performance of the act by the respondents. It is axiomatic, to begin with, that a party who seeks the intervention of a court of law upon an administrative concern should first avail himself of all the remedies afforded by administrative processes. The issues that an administrative agency is authorized to decide should not be summarily taken away from it and submitted to a court of law without first 16 giving the agency the opportunity to dispose of the issues upon due deliberation. The court of law must allow the administrative agency to carry out its functions and discharge its responsibilities within the specialized areas of its 17 competence. This rests on the theory that the administrative authority is in a better position to resolve questions addressed to its particular expertise, and that errors committed by subordinates in their resolution may be rectified by their 18 superiors if given a chance to do so. The records show that the petitioner failed to exhaust the available administrative remedies. At the time RD Lipayon 19 denied the petitioners application for the CNC, Administrative Order No. 42 dated November 2, 2002 had just vested the authority to grant or deny applications for the ECC in the Director and Regional Directors of the EMB. Notwithstanding the lack of a specific implementing guideline to what office the ruling of the EMB Regional Director was to be appealed, the petitioner could have been easily guided in that regard by the Administrative Code of 1987, which provides that the 20 Director of a line bureau, such as the EMB, shall have supervision and control over all division and other units, including 21 regional offices, under the bureau. Verily, supervision and control include the power to "review, approve, reverse or 22 modify acts and decisions of subordinate officials or units." Accordingly, the petitioner should have appealed the EMB Regional Directors decision to the EMB Director, who exercised supervision and control over the former. 23 It is relevant to mention that the DENR later promulgated Administrative Order No. 2003-30 in order to define where appeals should be taken, providing as follows: Section 6. Appeal Any party aggrieved by the final decision on the ECC/CNC applications may, within 15 days from receipt of such decision, file an appeal on the following grounds: a. Grave abuse of discretion on the part of the deciding authority, or b. Serious errors in the review findings. The DENR may adopt alternative conflict/dispute resolution procedures as a means to settle grievances between proponents and aggrieved parties to avert unnecessary legal action. Frivolous appeals shall not be countenanced. The proponent or any stakeholder may file an appeal to the following: 1wphi1 Deciding Authority EMB Regional Office Director EMB Central Office Director DENR Secretary Where to file the appeal Office of the EMB Director Office of the DENR Secretary Office of the President

Moreover, the petitioner states in its pleadings that it had a pending appeal with the DENR Secretary. 1wphi1 However, the records reveal that the subject of the appeal of the petitioner was an undated resolution of the DENR Regional 24 Director, Region VII, denying its application for the CNC, not the decision of RD Lipayon. Nonetheless, even assuming

that the pending appeal with the DENR Secretary had related to RD Lipayons decision, the petitioner should still have waited for the DENR Secretary to resolve the appeal in line with the principle of exhaustion of administrative remedies. Its failure to do so rendered its resort to mandamus in the RTC premature. The omission is fatal, because mandamus is a 25 remedy only when there is no appeal, nor any plain, speedy and adequate remedy in the ordinary course of law. Another reason for denying due course to this review is that the petitioner did not establish that the grant of its application for the CNC was a purely ministerial in nature on the part of RD Lipayon. Hence, mandamus was not a proper remedy. The CNC is a certification issued by the EMB certifying that a project is not covered by the Environmental Impact 26 Statement System (EIS System) and that the project proponent is not required to secure an ECC. The EIS System was established by Presidential Decree (P.D.) No. 1586 pursuant to Section 4 of P.D. No. 1151 (Philippine Environmental Policy) that required all entities to submit an EIS for projects that would have a significant effect on the environment, thus: Section 4. Environmental Impact Statements. Pursuant to the above enunciated policies and goals, all agencies and instrumentalities of the national government, including government-owned or controlled corporations, as well as private corporations, firms and entities shall prepare, file and include in every action, project or undertaking which significantly affects the quality of the environment a detailed statement on (a) the environmental impact of the proposed action, project or undertaking (b) any adverse environmental effect which cannot be avoided should the proposal be implemented (c) alternative to the proposed action (d) a determination that the short-term uses of the resources of the environment are consistent with the maintenance and enhancement of the long-term productivity of the same; and (e) whenever a proposal involves the use of depletable or non-renewable resources, a finding must be made that such use and commitment are warranted. xxxx P.D. No. 1586 exempted from the requirement of an EIS the projects and areas not declared by the President of the 27 Philippines as environmentally critical, thus: Section 5. Environmentally Non-Critical Projects. - All other projects, undertakings and areas not declared by the Presidents as environmentally critical shall be considered as non-critical and shall not be required to submit an environmental impact statement. The National Environmental Protection Council, thru the Ministry of Human Settlements may however require non-critical projects and undertakings to provide additional environmental safeguards as it may deem necessary. On December 14, 1981, the President issued Proclamation No. 2146 declaring areas and types of projects as environmentally critical and within the scope of the EIS System, as follows: A. Environmentally Critical Projects I. Heavy Industries a. Non-ferrous metal industries b. Iron and steel mills c. Petroleum and petro-chemical industries including oil and gas d. Smelting plants II. Resource Extractive Industries a. Major mining and quarrying projects b. Forestry projects 1. Logging 2. Major wood processing projects 3. Introduction of fauna (exotic-animals) in public/private forests 4. Forest occupancy 5. Extraction of mangrove products 6. Grazing c. Fishery Projects 1. Dikes for fishpond development projects III. Infrastructure Projects a. Major dams b. Major power plants (fossil-fueled, nuclear fueled, hydroelectric or geothermal) c. Major reclamation projects d. Major roads and bridges. B. Environmentally Critical Areas 1. All areas declared by law as national parks, watershed reserves, wildlife preserves and sanctuaries; 2. Areas set aside as aesthetic potential tourist spots; 3. Areas which constitute the habitat for any endangered or threatened species of indigenous Philippine Wildlife (flora and fauna); 4. Areas of unique historic, archaeological, or scientific interests; 5. Areas which are traditionally occupied by cultural communities or tribes; 6. Areas frequently visited and/or hard-hit by natural calamities (geologic hazards, floods, typhoons, volcanic activity, etc.);

7. Areas with critical slopes; 8. Areas classified as prime agricultural lands; 9. Recharged areas of aquifers; 10. Water bodies characterized by one or any combination of the following conditions; a. tapped for domestic purposes b. within the controlled and/or protected areas declared by appropriate authorities c. which support wildlife and fishery activities 11. Mangrove areas characterized by one or any combination of the following conditions: a. with primary pristine and dense young growth; b. adjoining mouth of major river systems; c. near or adjacent to traditional productive fry or fishing grounds; d. which act as natural buffers against shore erosion, strong winds and storm floods; e. on which people are dependent for their livelihood. 12. Coral reef, characterized by one or any combination of the following conditions: a. with 50% and above live coralline cover; b. spawning and nursery grounds for fish; c. which act as natural breakwater of coastlines. Projects not included in the foregoing enumeration were considered non-critical to the environment and were entitled to the CNC. The foregoing considerations indicate that the grant or denial of an application for ECC/CNC is not an act that is purely ministerial in nature, but one that involves the exercise of judgment and discretion by the EMB Director or Regional Director, who must determine whether the project or project area is classified as critical to the environment based on the documents to be submitted by the applicant. The petitioner maintains that RD Lipayon already exercised his discretion in its case when he made his finding that the application substantially complied with the procedural requirements for review. As such, he was then obliged to issue the CNC once the petitioner had submitted the required certifications. The petitioner errs on two grounds. Firstly, RD Lipayon had not yet fully exercised his discretion with regard to the CNC application when he made his finding. It is clear that his finding referred to the "procedural requirements for review" only. He had still to decide on the substantive aspect of the application, that is, whether the project and the project area were considered critical to the environment. In fact, this was the reason why RD Lipayon required the petitioner to submit certifications from the various government agencies concerned. Surely, the required certifications were not mere formalities, because they would serve as the bases for his decision on whether to grant or deny the application. Secondly, there is no sufficient showing that the petitioner satisfactorily complied with the requirement to submit the needed certifications. For one, it submitted no certification to the effect that the project site was not within a critical slope. Also, the PHIVOLCSs certification showed that the project site had experienced an Intensity VII earthquake in 1990, a fact that sufficed to place the site in the category of "areas frequently visited and/or hard-hit by natural calamities." Clearly, the petitioner failed to establish that it had the legal right to be issued the CNC applied for, warranting the denial of its application. It is not amiss for us to observe, therefore, that the petitioner grossly misunderstood the nature of the remedy of mandamus. To avoid similar misunderstanding of the remedy hereafter, a short exposition on the nature and office of the remedy is now appropriate. The writ of mandamus is of very ancient and obscure origin. It is believed that the writ was originally part of the class of 28 writs or mandates issued by the English sovereign to direct his subjects to perform a particular act or duty. The earliest writs were in the form of letters missive, and were mere personal commands. The command was a law in itself, from which there was no appeal. The writ of mandamus was not only declaratory of a duty under an existing law, but was a law 29 in itself that imposed the duty, the performance of which it commanded. The King was considered as the fountain and source of justice, and when the law did not afford a remedy by the regular forms of proceedings, the prerogative powers of 30 the sovereign were invoked in aid of the ordinary powers of the courts. A judicial writ of mandamus, issued in the Kings name out of the court of Kings Bench that had a general supervisory 31 power over all inferior jurisdictions and officers, gradually supplanted the old personal command of the sovereign. The court of Kings Bench, acting as the general guardian of public rights and in the exercise of its authority to grant the writ, rendered the writ of mandamus the suppletory means of substantial justice in every case where there was no other specific legal remedy for a legal right, and ensured that all official duties were fulfilled whenever the subject-matter was 32 properly within its control. Early on, the writ of mandamus was particularly used to compel public authorities to return the 33 petitioners to public offices from which they had been unlawfully removed. Mandamus was, therefore, originally a purely prerogative writ emanating from the King himself, superintending the police 34 and preserving the peace within the realm. It was allowed only in cases affecting the sovereign, or the interest of the 35 public at large. The writ of mandamus grew out of the necessity to compel the inferior courts to exercise judicial and ministerial powers invested in them by restraining their excesses, preventing their negligence and restraining their denial 36 of justice.

Over time, the writ of mandamus has been stripped of its highly prerogative features and has been assimilated to the nature of an ordinary remedy. Nonetheless, the writ has remained to be an extraordinary remedy in the sense that it is only issued in extraordinary cases and where the usual and ordinary modes of proceeding and forms of remedy are 37 powerless to afford redress to a party aggrieved, and where without its aid there would be a failure of justice. The writ of mandamus has also retained an important feature that sets it apart from the other remedial writs, i.e., that it is 38 used merely to compel action and to coerce the performance of a pre-existing duty. In fact, a doctrine well-embedded in our jurisprudence is that mandamus will issue only when the petitioner has a clear legal right to the performance of the act 39 sought to be compelled and the respondent has an imperative duty to perform the same. The petitioner bears the burden to show that there is such a clear legal right to the performance of the act, and a corresponding compelling duty on 40 the part of the respondent to perform the act. A key principle to be observed in dealing with petitions for mandamus is that such extraordinary remedy lies to compel the 41 performance of duties that are purely ministerial in nature, not those that are discretionary. A purely ministerial act or duty is one that an officer or tribunal performs in a given state of facts, in a prescribed manner, in obedience to the mandate of a legal authority, without regard to or the exercise of its own judgment upon the propriety or impropriety of the 42 act done. The duty is ministerial only when its discharge requires neither the exercise of official discretion or judgment. The petitioner's disregard of the foregoing fundamental requisites for mandamus rendered its petition in the RTC untenable and devoid of merit. WHEREFORE, the Court DENIES the petition for review on certiorari; and ORDERS the petitioner to pay the costs of suit. SO ORDERED. LUCAS P. BERSAMIN Associate Justice