Chavez v.

Pea and Amari

G.R. No. 133250

July 9, 2002

Fact:
In 1973, the Comissioner on Public Highways entered into a contract to reclaim areas of Manila Bay
with the Construction and Development Corportion of the Philippines (CDCP).
Public Estates Authority (PEA) was created by President Marcos by virtue of P.D. 1084, tasked with
developing and leasing reclaimed lands. These lands were transferred to the care of PEA under P.D.
1085 as part of the Manila Cavite Road and Reclamation Project (MCRRP). CDCP and PEA entered
into an agreement that all future projects under the MCRRP would be funded and owned by PEA.
By 1988, President Aquino issued Special Patent No. 3517 transferring lands to PEA. It was followed
by the transfer of three Titles (7309, 7311 and 7312) by the Register of Deeds of Paranaque to PEA
covering the three reclaimed islands known as the FREEDOM ISLANDS.
Subsquently, PEA entered into a joint venture agreement with AMARI, a Thai-Philippine corporation
to develop the Freedom Islands. Along with another 250 hectares, PEA and AMARI entered the JVA
which would later transfer said lands to AMARI. Petitioner Frank J. Chavez filed case as a taxpayer
praying for mandamus, a writ of preliminary injunction and a TRO against the sale of reclaimed lands
by PEA to AMARI and from implementing the JVA. Following these events, under President
Estradas administration, PEA and AMARI entered into an Amended JVA and Mr. Chaves claim that
the contract is null and void.

ISSUES:
Whether the stipulations in the amended joint venture agreement for the transfer to Amari of certain lands, reclaimed
and still to be reclaimed, violate the 1987 Constitution;

HELD:

The court ruled that it violates the constitution. PEA may reclaim these submerged areas. Thereafter, the government
can classify the reclaimed lands as alienable or disposable, and further declare them no longer needed for public
service. Still, the transfer of such reclaimed alienable lands of the public domain to AMARI will be void in view of
Section 3, Article XII of the 1987Constitution which prohibits private corporations from acquiring any kind of alienable

land of the public domain.