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G.R. No. 135385 December 6, 2000 RESOLUTION PER CURIAM: Petitioners Isagani Cruz and Cesar Europa brought this suit for prohibition and mandamus as citizens and taxpayers, assailing the constitutionality of certain provisions of Republic Act No. 8371 (R.A. 8371), otherwise known as the Indigenous Peoples Rights Act of 1997 (IPRA), and its Implementing Rules and Regulations (Implementing Rules). In its resolution of September 29, 1998, the Court required respondents to comment. In compliance, respondents Chairperson and Commissioners of the National Commission on Indigenous Peoples (NCIP), the government agency created under the IPRA to implement its provisions, filed on October 13, 1998 their Comment to the Petition, in which they defend the constitutionality of the IPRA and pray that the petition be dismissed for lack of merit. On October 19, 1998, respondents Secretary of the Department of Environment and Natural Resources (DENR) and Secretary of the Department of Budget and Management (DBM) filed through the Solicitor General a consolidated Comment. The Solicitor General is of the view that the IPRA is partly unconstitutional on the ground that it grants ownership over natural resources to indigenous peoples and prays that the petition be granted in part. On November 10, 1998, a group of intervenors, composed of Sen. Juan Flavier, one of the authors of the IPRA, Mr. Ponciano Bennagen, a member of the 1986 Constitutional Commission, and the leaders and members of 112 groups of indigenous peoples (Flavier, et. al), filed their Motion for Leave to Intervene. They join the NCIP in defending the constitutionality of IPRA and praying for the dismissal of the petition. On March 22, 1999, the Commission on Human Rights (CHR) likewise filed a Motion to Intervene and/or to Appear as Amicus Curiae. The CHR asserts that IPRA is an expression of the principle of parens patriae and that the State has the responsibility to protect and guarantee the rights of those who are at a serious disadvantage like indigenous peoples. For this reason it prays that the petition be dismissed. On March 23, 1999, another group, composed of the Ikalahan Indigenous People and the Haribon Foundation for the Conservation of Natural Resources, Inc. (Haribon, et al.), filed a motion to Intervene with attached Comment-in-Intervention. They agree with the NCIP and Flavier, et al. that IPRA is consistent with the Constitution and pray that the petition for prohibition and mandamus be dismissed. The motions for intervention of the aforesaid groups and organizations were granted. Oral arguments were heard on April 13, 1999. Thereafter, the parties and intervenors filed their respective memoranda in which they reiterate the arguments adduced in their earlier pleadings and during the hearing.
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ISAGANI CRUZ and CESAR EUROPA, petitioners, vs. SECRETARY OF ENVIRONMENT AND NATURAL RESOURCES, SECRETARY OF BUDGET AND MANAGEMENT and CHAIRMAN and COMMISSIONERS OF THE NATIONAL COMMISSION ON INDIGENOUS PEOPLES, respondents. HON. JUAN M .FLAVIER, HON. PONCIANO BENNAGEN, BAYANI ASCARRAGA, EDTAMI MANSAYANGAN, BASILIO WANDAG, EVELYN DUNUAN, YAOM TUGAS, ALFREMO CARPIANO, LIBERATO A. GABIN, MATERNIDAD M. COLAS, NARCISA M. DALUPINES, BAI KIRAM-CONNIE SATURNO, BAE MLOMOBEATRIZ T. ABASALA, DATU BALITUNGTUNG-ANTONIO D. LUMANDONG, DATU MANTUMUKAW TEOFISTO SABASALES, DATU EDUAARDO BANDA, DATU JOEL UNAD, DATU RAMON BAYAAN, TIMUAY JOSE ANOY, TIMUAY MACARIO D. SALACAO, TIMUAY EDWIN B. ENDING, DATU SAHAMPONG MALANAW VI, DATU BEN PENDAO CABIGON, BAI NANAPNAY-LIZA SAWAY, BAY INAY DAYA-MELINDA S. REYMUNDO, BAI TINANGHAGA HELINITA T. PANGAN, DATU MAKAPUKAW ADOLINO L. SAWAY, DATU MAUDAYAW-CRISPEN SAWAY, VICKY MAKAY, LOURDES D. AMOS, GILBERT P. HOGGANG, TERESA GASPAR, MANUEL S. ONALAN, MIA GRACE L. GIRON, ROSEMARIE G. PE, BENITO CARINO, JOSEPH JUDE CARANTES, LYNETTE CARANTES-VIVAL, LANGLEY SEGUNDO, SATUR S. BUGNAY, CARLING DOMULOT, ANDRES MENDIOGRIN, LEOPOLDO ABUGAN, VIRGILIO CAYETANO, CONCHITA G. DESCAGA, LEVY ESTEVES, ODETTE G. ESTEVEZ, RODOLFO C. AGUILAR, MAURO VALONES, PEPE H. ATONG, OFELIA T. DAVI, PERFECTO B. GUINOSAO, WALTER N. TIMOL, MANUEL T. SELEN, OSCAR DALUNHAY, RICO O. SULATAN, RAFFY MALINDA, ALFREDO ABILLANOS, JESSIE ANDILAB, MIRLANDO H. MANGKULINTAS, SAMIE SATURNO, ROMEO A. LINDAHAY, ROEL S. MANSANG-CAGAN, PAQUITO S. LIESES, FILIPE G. SAWAY, HERMINIA S. SAWAY, JULIUS S. SAWAY, LEONARDA SAWAY, JIMMY UGYUB, SALVADOR TIONGSON, VENANCIO APANG, MADION MALID, SUKIM MALID, NENENG MALID, MANGKATADONG AUGUSTO DIANO, JOSEPHINE M. ALBESO, MORENO MALID, MARIO MANGCAL, FELAY DIAMILING, SALOME P. SARZA, FELIPE P. BAGON, SAMMY SALNUNGAN, ANTONIO D. EMBA, NORMA MAPANSAGONOS, ROMEO SALIGA, SR., JERSON P. GERADA, RENATO T. BAGON, JR., SARING MASALONG, SOLEDAD M. GERARDA, ELIZABETH L. MENDI, MORANTE S. TIWAN, DANILO M. MALUDAO, MINORS MARICEL MALID, represented by her father CORNELIO MALID, MARCELINO M. LADRA, represented by her father MONICO D. LADRA, JENNYLYN MALID, represented by her father TONY MALID, ARIEL M. EVANGELISTA, represented by her mother LINAY BALBUENA, EDWARD M. EMUY, SR., SUSAN BOLANIO, OND, PULA BATO B'LAAN TRIBAL FARMER'S ASSOCIATION, INTER-PEOPLE'S EXCHANGE, INC. and GREEN FORUM-WESTERN VISAYAS, intervenors. COMMISSION ON HUMAN RIGHTS, intervenor. IKALAHAN INDIGENOUS PEOPLE and HARIBON FOUNDATION FOR THE CONSERVATION OF NATURAL RESOURCES, INC., intervenor.

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Petitioners assail the constitutionality of the following provisions of the IPRA and its Implementing Rules on the ground that they amount to an unlawful deprivation of the State’s ownership over lands of the public domain as well as minerals and other natural resources therein, in violation of the regalian doctrine embodied in Section 2, Article XII of the Constitution: "(1) Section 3(a) which defines the extent and coverage of ancestral domains, and Section 3(b) which, in turn, defines ancestral lands; "(2) Section 5, in relation to section 3(a), which provides that ancestral domains including inalienable public lands, bodies of water, mineral and other resources found within ancestral domains are private but community property of the indigenous peoples; "(3) Section 6 in relation to section 3(a) and 3(b) which defines the composition of ancestral domains and ancestral lands; "(4) Section 7 which recognizes and enumerates the rights of the indigenous peoples over the ancestral domains; (5) Section 8 which recognizes and enumerates the rights of the indigenous peoples over the ancestral lands; "(6) Section 57 which provides for priority rights of the indigenous peoples in the harvesting, extraction, development or exploration of minerals and other natural resources within the areas claimed to be their ancestral domains, and the right to enter into agreements with nonindigenous peoples for the development and utilization of natural resources therein for a period not exceeding 25 years, renewable for not more than 25 years; and "(7) Section 58 which gives the indigenous peoples the responsibility to maintain, develop, protect and conserve the ancestral domains and portions thereof which are found to be necessary for critical 2 watersheds, mangroves, wildlife sanctuaries, wilderness, protected areas, forest cover or reforestation." Petitioners also content that, by providing for an all-encompassing definition of "ancestral domains" and "ancestral lands" which might even include private lands found within said areas, Sections 3(a) and 3(b) 3 violate the rights of private landowners. In addition, petitioners question the provisions of the IPRA defining the powers and jurisdiction of the NCIP and making customary law applicable to the settlement of disputes involving ancestral domains and 4 ancestral lands on the ground that these provisions violate the due process clause of the Constitution. These provisions are: "(1) sections 51 to 53 and 59 which detail the process of delineation and recognition of ancestral domains and which vest on the NCIP the sole authority to delineate ancestral domains and ancestral lands; "(2) Section 52[i] which provides that upon certification by the NCIP that a particular area is an ancestral domain and upon notification to the following officials, namely, the Secretary of Environment and Natural Resources, Secretary of Interior and Local Governments, Secretary of Justice and Commissioner of the National Development Corporation, the jurisdiction of said officials over said area terminates; "(3) Section 63 which provides the customary law, traditions and practices of indigenous peoples shall be applied first with respect to property rights, claims of ownership, hereditary succession and settlement of land disputes, and that any doubt or ambiguity in the interpretation thereof shall be resolved in favor of the indigenous peoples; "(4) Section 65 which states that customary laws and practices shall be used to resolve disputes involving indigenous peoples; and "(5) Section 66 which vests on the NCIP the jurisdiction over all claims and disputes involving 5 rights of the indigenous peoples." Finally, petitioners assail the validity of Rule VII, Part II, Section 1 of the NCIP Administrative Order No. 1, series of 1998, which provides that "the administrative relationship of the NCIP to the Office of the President is characterized as a lateral but autonomous relationship for purposes of policy and program coordination." They contend that said Rule infringes upon the President’s power of control over executive 6 departments under Section 17, Article VII of the Constitution. Petitioners pray for the following: "(1) A declaration that Sections 3, 5, 6, 7, 8, 52[I], 57, 58, 59, 63, 65 and 66 and other related provisions of R.A. 8371 are unconstitutional and invalid; "(2) The issuance of a writ of prohibition directing the Chairperson and Commissioners of the NCIP to cease and desist from implementing the assailed provisions of R.A. 8371 and its Implementing Rules; "(3) The issuance of a writ of prohibition directing the Secretary of the Department of Environment and Natural Resources to cease and desist from implementing Department of Environment and Natural Resources Circular No. 2, series of 1998;

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"(4) The issuance of a writ of prohibition directing the Secretary of Budget and Management to cease and desist from disbursing public funds for the implementation of the assailed provisions of R.A. 8371; and "(5) The issuance of a writ of mandamus commanding the Secretary of Environment and Natural Resources to comply with his duty of carrying out the State’s constitutional mandate to co ntrol and supervise the exploration, development, utilization and conservation of Philippine natural 7 resources." After due deliberation on the petition, the members of the Court voted as follows: Seven (7) voted to dismiss the petition. Justice Kapunan filed an opinion, which the Chief Justice and Justices Bellosillo, Quisumbing, and Santiago join, sustaining the validity of the challenged provisions of R.A. 8371. Justice Puno also filed a separate opinion sustaining all challenged provisions of the law with the exception of Section 1, Part II, Rule III of NCIP Administrative Order No. 1, series of 1998, the Rules and Regulations Implementing the IPRA, and Section 57 of the IPRA which he contends should be interpreted as dealing with the large-scale exploitation of natural resources and should be read in conjunction with Section 2, Article XII of the 1987 Constitution. On the other hand, Justice Mendoza voted to dismiss the petition solely on the ground that it does not raise a justiciable controversy and petitioners do not have standing to question the constitutionality of R.A. 8371. Seven (7) other members of the Court voted to grant the petition. Justice Panganiban filed a separate opinion expressing the view that Sections 3 (a)(b), 5, 6, 7 (a)(b), 8, and related provisions of R.A. 8371 are unconstitutional. He reserves judgment on the constitutionality of Sections 58, 59, 65, and 66 of the law, which he believes must await the filing of specific cases by those whose rights may have been violated by the IPRA. Justice Vitug also filed a separate opinion expressing the view that Sections 3(a), 7, and 57 of R.A. 8371 are unconstitutional. Justices Melo, Pardo, Buena, Gonzaga-Reyes, and De Leon join in the separate opinions of Justices Panganiban and Vitug. As the votes were equally divided (7 to 7) and the necessary majority was not obtained, the case was redeliberated upon. However, after redeliberation, the voting remained the same. Accordingly, pursuant to Rule 56, Section 7 of the Rules of Civil Procedure, the petition is DISMISSED. Attached hereto and made integral parts thereof are the separate opinions of Justices Puno, Vitug, Kapunan, Mendoza, and Panganiban. SO ORDERED. Davide, Jr., C.J., Bellosillo, Melo, Quisumbing, Pardo, Buena, Gonzaga-Reyes, Ynares-Santiago, and De Leon, Jr., JJ., concur. Puno, Vitug, Kapunan, Mendoza and Panganiban JJ., see separate opinion Footnotes
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Rollo, p. 114. Petition, Rollo, pp. 16-23. Id. at 23-25.

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Section 1, Article III of the Constitution states: "No person shall be deprived of life, liberty or property without due process of law, nor shall any person be denied the equal protection of the laws."
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Rollo, pp. 25-27. Id. at 27-28. Transcript of Stenographic Notes of the hearing held on April 13, 1999, pp. 5-6.

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SEPARATE OPINION PUNO, J.: PRECIS A classic essay on the utility of history was written in 1874 by Friedrich Nietzsche entitled "On the Uses 1 2 and Disadvantages of History for Life." Expounding on Nietzsche's essay, Judge Richard Posner wrote: "Law is the most historically oriented, or if you like the most backward-looking, the most 'pastdependent,' of the professions. It venerates tradition, precedent, pedigree, ritual, custom, ancient practices, ancient texts, archaic terminology, maturity, wisdom, seniority, gerontocracy, and interpretation conceived of as a method of recovering history. It is suspicious of innovation, discontinuities, 'paradigm shifts,' and the energy and brashness of youth. These ingrained attitudes are obstacles to anyone who wants to re-orient law in a more pragmatic direction. But, by the same token, pragmatic jurisprudence must come to terms with history." When Congress enacted the Indigenous Peoples Rights Act (IPRA), it introduced radical concepts into the Philippine legal system which appear to collide with settled constitutional and jural precepts on state ownership of land and other natural resources. The sense and subtleties of this law cannot be appreciated without considering its distinct sociology and the labyrinths of its history. This Opinion attempts to interpret IPRA by discovering its soul shrouded by the mist of our history. After all, the IPRA was enacted

. Part II. Article XII of the 1987 Consitution. 7 (b) and 57 of the IPRA do not violate the Regalian Doctrine enshrined in Section 2. Sections 7 (a). This Opinion discusses the following: I. The right to ancestral domains and ancestral lands: how acquired 2. Section 2. The "Regalian Doctrine" or jura regaliais a Western legal concept that was first introduced by the Spaniards into the 3 (c) Why the Cariño doctrine is unique 3. A. control and supervision in their development and exploitation. (c) The large-scale utilization of natural resources in Section 57 of the IPRA may be harmonized with Paragraphs 1 and 4. 1. The option of securing a torrens title to the ancestral land B. The right of ownership and possession by the ICCs/IPs to their ancestral domains is a limited form of ownership and does not include the right to alienate the same. 1. This was the foundation for the early Spanish decrees embracing the feudal theory of jura regalia. The Philippine Constitutions II. Article XII of the 1987 Constitution. Murciano C. (b) The small-scale utilization of natural resources in Section 7 (b) of the IPRA is allowed under Paragraph 3. The Development of the Regalian Doctrine in the Philippine Legal System. Insular Government (b) Indian Title to land C. Their Concept of Land III. The IPRA is a Novel Piece of Legislation. DISCUSSION I. The Provisions of the IPRA Do Not Contravene the Constitution. The IPRA is a Recognition of Our Active Participation in the International Indigenous Movement. V. Valenton v. The Public Land Acts and the Torrens System D. The indigenous concept of ownership and customary law A. Section 2. 1. Ancestral domains and ancestral lands are the private property of indigenous peoples and do not constitute part of the land of the public domain. The Laws of the Indies B. A. A. The Laws of the Indies The capacity of the State to own or acquire property is the state's power of dominium. The rights of ICCs/IPs over their ancestral domains and lands 2.LAW ON NATURAL RESOURCES and ENVIRONMENTAL LAW Cases and Special Laws |4 by Congress not only to fulfill the constitutional mandate of protecting the indigenous cultural communities' right to their ancestral land but more importantly. A. The right of ICCs/IPs to develop lands and natural resources within the ancestral domains does not deprive the State of ownership over the natural resources. The Indigenous Peoples Rights Act (IPRA). to correct a grave historical injustice to our indigenous people. THE DEVELOPMENT OF THE REGALIAN DOCTRINE IN THE PHILIPPINE LEGAL SYSTEM. Article XII of the 1987 Constitution. Legislative History IV. Indigenous Peoples 1. Indigenous Peoples: Their History 2. (a) Section 1. The concept of native title (a) Cariño v. Rule III of the Implementing Rules goes beyond the parameters of Section 7(a) of the law on ownership of ancestral domains and is ultra vires.

Plaintiffs had entered into peaceful occupation of the subject land in 1860. This statement excludes the idea that there might be lands not so granted. And those who are in possession by virtue of proper deeds and receipts. or by the 13 kings who preceded him. asserting that their 30-year adverse possession. and if so. otherwise. the Court said. in the Royal Order of July 5. Law 14. it is our will that all lands which are held without proper and true deeds of grant be restored to us as they belong to us. It is apparent that it was not the intention of the law that mere possession for a length of time should make the possessors the 12 owners of the land possessed by them without any action on the part of the authorities.. pastures. plantations. or in our name.e. And those who h P. territories. Title 12. under the American regime. more specifically. and all the rest shall be restored to us to 4 be disposed of at our will. and commons in those places which are peopled. In 1903. However. the first Public Land Act. both military and 5 civilian." The Philippines passed to Spain by virtue of "discovery" and conquest. that did not belong to the king. taking into consideration not only their present condition. The Spanish Government took charge of distributing the lands by issuing royal grants and concessions to Spaniards. confirming them in what they now have and giving them more if necessary. 926. purchased the land from the provincial treasurer of Tarlac in 1892. or by us. This was the last Spanish land law promulgated in the Philippines. passed Act No. their title deeds thereto. belonged to the Crown. as an extraordinary period of prescription in the Partidas and the Civil Code. having acquired full sovereignty over the Indies. The Laws of the Indies were followed by the Ley Hipotecaria. and the Royal Cedula of 1754. on the other hand. Private land titles could only be acquired from the government either by purchase or by the 6 various modes of land grant from the Crown. a suitable period within which all possessors of tracts. because some private person had been in the adverse occupation of them. The Spanish Mortgage Law provided for the systematic registration of titles and deeds as well as possessory claims. B. still pertaining to the royal crown and patrimony. but also their future and their probable increase. or in his name. or in his name. and after distributing to the natives what may be necessary for tillage and pasturage. the Laws of the Indies would be followed. The lower court ruled against the plaintiffs on the ground that they had lost all rights to the land by not objecting to the administrative sale. We therefore order and command that all viceroys and presidents of pretorial courts designate at such time as shall to them seem most expedient. or the Mortgage Law of 1893. or the "Maura Law. Defendant's predecessor-in-interest. farms. and possessions not heretofore ceded away by our royal predecessors. the decree provided for a system of assignment of such lands. to what extent was it recognized?" Prior to 1880. 1898. Title 12. 9 Valenton resolved the question of which is the better basis for ownership of land: long-time occupation or paper title. all the rest of said lands may remain free and unencumbered for us to dispose of as we may wish. as is seen." The question posed by the Court was: "Did these special laws recognize any right of prescription as against the State as to these lands. and estates shall exhibit to them and to the court officers appointed by them for this purpose. otherwise the lands shall revert to the state. Murciano. For those lands granted by the king." was partly an amendment of the Mortgage Law as well as the Laws of the Indies. Book 4 of the Novisima Recopilacion de Leyes de las Indias . the land would be restored to the Crown. had given them title to the land as against everyone. in order that after reserving before all what to us or to our viceroys. It also ordered that all possessors of agricultural land 14 should exhibit their title deed. the court interpreted it as follows: "In the preamble of this law there is.LAW ON NATURAL RESOURCES and ENVIRONMENTAL LAW Cases and Special Laws |5 country through the Laws of the Indies and the Royal Cedulas. as 8 already amended by previous orders and decrees. not owning the land. their title papers. . there were no laws specifically providing for the disposition of land in the Philippines. by the Treaty of Paris of December 10. this Court decided the case of Valenton v. The Royal Decree of 1894. Murciano 7 In 1904. speaking through Justice Willard. and governors may seem necessary for public squares. Book 4 of the Recopilacion de Leyes de las Indias. it was understood that in the absence of any special law to govern a specific colony. The Laws of the Indies.kkkkkk Four years later. and within a time to be fixed by them. a distinct statement that all those lands belong to the Crown which have not been granted by Philip. ad good title or showed prescription were to be protected in their holdings. theOrdenanza of the Intendentes of 1786. 1862. Valenton v. the United States colonial government. audiencias. ways. Indeed. it was decreed that until regulations on the subject could be prepared. It required the "adjustment" or registration of all agricultural lands. Quoting the preamble of Law 14. The Court. the authorities of the Philippine Islands should follow 11 strictly the Laws of the Indies. i. and that the State. The law sought to register and tax lands pursuant to the Royal Decree of 1880. could not validly transmit it. Consequently. or by virtue of just prescriptive right shall be protected. By the mandatory part of the law all the occupants of the public lands are required to produce before the authorities named. interests and claims over the national territory of the Philippine Islands. and all lands." The preamble stated that all those lands which had not been granted by Philip. decided the case on the basis of "those special laws which 10 from earliest time have regulated the disposition of the public lands in the colonies. through the Philippine Commission. It excludes the idea that the king was not still the owner of all ungranted lands . all lands became the exclusive patrimony and dominion of the Spanish Crown. Plaintiffs appealed the judgment. Spain ceded to the government of the United States all rights. or by the kings who preceded him. set the policy of the Spanish Crown with respect to the Philippine Islands in the following manner: "We. including the State.

It prescribed rules and regulations for the homesteading. State ownership of natural resources was seen as a necessary starting point to secure recognition of the state's power to 30 control their disposition. they will be deprived of and evicted from their lands. and excluded the patrimonial property of the government and the friar 22 lands. The Torrens system requires that the government issue an official certificate of title attesting to the fact that the person named is the owner of the property described therein. the first Public Land Act. than it did under the earlier ones. This system highly facilitates land conveyance and negotiation." Valenton had no rights other than those which accrued to mere possession. in turn. The delegates to the Constitutional Convention very well knew that the concept of State ownership of land and natural resources was introduced by the Spaniards.LAW ON NATURAL RESOURCES and ENVIRONMENTAL LAW Cases and Special Laws |6 The Royal Cedula of October 15. the Crown adopted regulations for the adjustment of lands "wrongfully occupied" by private individuals in the Philippine Islands. was passed in pursuance of the provisions of the the Philippine Bill of 1902. 141. After the passage of the 1935 Constitution. selling. Valenton construed these regulations together with contemporaneous legislative and executive interpretations of the law. Grants of public land were brought under the operation of the Torrens system under Act 496. or utilization. and obtain from them his deed. exploitation. It was more comprehensive in scope but limited the exploitation of agricultural lands to Filipinos and Americans and citizens of other countries which gave Filipinos the same 23 privileges. The law is said to be almost a verbatim copy of 25 the Massachussetts Land Registration Act of 1898. The Public Land Acts and the Torrens System Act No. Thus. 141 remains the present Public Land Law and it is essentially the same as Act 2874. 926 was superseded in 1919 by Act 2874. the Court ruled: "We hold that from 1860 to 1892 there was no law in force in these Islands by which the plaintiffs could obtain the ownership of these lands by prescription. Act No. Murciano. and they will be 15 granted to others. D." reads as follows: . without any action by 17 the State. and for the cancellation or confirmation of Spanish concessions and grants in the Islands. " C. 1754 reinforced the Recopilacion when it ordered the Crown's principal subdelegate to issue a general order directing the publication of the Crown's instructions: "x x x to the end that any and all persons who. the Court stated: "While the State has always recognized the right of the occupant to a deed if he proves a possession for a sufficient length of time." In short. The law governed the disposition of lands of the public domain. Act 496 placed all public and private lands in the Philippines under the Torrens system. in Section 1 of Article XIII on "Conservation and Utilization of Natural Resources. for the completion of imperfect titles. was deemed to be the owner of the land by virtue of the grant by the provincial secretary. they were not certain whether it was continued and applied by the Americans. development. and leasing of portions of the public domain of the Philippine Islands. followed the principles and procedure of the Torrens system of registration formulated by Sir Robert Torrens who patterned it after the Merchant Shipping Acts in South Australia. yet it has always insisted that he must make that proof before the proper administrative officers. the Convention approved the provision in the Constitution affirming the 31 Regalian doctrine. which. and prescribed the terms and conditions to enable persons to perfect their titles to public lands in the Islands. This new law was passed under the Jones Law. has 18 been continued by the American Government in Act No. 926. since the year 1700. however. Said subdelegates will at the same time warn the parties interested that in case of their failure to present their title deeds within the term designated." for the establishment of town sites and sale of lots therein. the Public Land Act operated on the assumption that title to public lands in the Philippine Islands remained in the 19 government. Act 2874 was amended in 1936 by Commonwealth Act No. Commonwealth Act No. It also provided for the "issuance of patents to certain native settlers upon public lands. The term "public land" referred to all lands of the public domain whose title still remained in the government and are thrown open to private 21 appropriation and settlement. One of the fixed and dominating objectives of the 1935 Constitutional Convention was the nationalization and conservation of the natural resources 28 of the country. subject to such liens and encumbrances as thereon noted or the law warrants or 26 reserves. Valenton upheld the Spanish concept of state ownership of public land. and concluded that plaintiffs' case fared no better under the 1880 decree and other laws which followed it. may x x x appear and exhibit to said subdelegates the titles and patents by virtue of which said lands are occupied. There was an overwhelming sentiment in the Convention in favor of the principle of 29 state ownership of natural resources and the adoption of the Regalian doctrine. on the other hand." On June 25. and up to the date of the promulgation and publication of said order. without a just and valid reason therefor. the Court added that "[t]he policy pursued by the Spanish Government from earliest times. the second Public Land Act. The Philippine Constitutions The Regalian doctrine was enshrined in the 1935 Constitution. The main difference between the two relates to the transitory provisions on the rights of American citizens and corporations during the Commonwealth period at par 24 with Filipino citizens and corporations. To remove all doubts. The certificate of title is indefeasible and imprescriptible and all claims to the parcel of land are 27 quieted upon issuance of said certificate. shall have occupied royal lands. 926. x x x. whether or not x x x cultivated or tenanted. In effect. the 1935 Constitution. and until he did that the State remained the 16 absolute owner. Thus as a general doctrine. 1880. or the Land Registration Law of 1903. requiring settlers on the public lands to obtain title deeds therefor from the State." In conclusion. As a fitting observation. and that the government's title to public land sprung from the Treaty of Paris and other 20 subsequent treaties between Spain and the United States. Enacted by the Philippine Commission.

Establishing Implementing Mechanisms. minerals. all lands of the public domain as well as all natural resources enumerated therein." to wit: "Sec. It grants these people the ownership and possession of their ancestral domains and ancestral lands. x x x. . Protect and Promote the Rights of Indigenous Cultural Communities/ Indigenous Peoples. natural resources shall not be alienated.the right to safe and clean air and water. It is this concept of State ownership that petitioners claim is being violated by the IPRA. coal. All lands of the public domain. fisheries. fisheries. and defines the extent of these lands and domains. Natural resources. All lands of the public domain. With the exception of agricultural lands.the right to ancestral lands which include a. and their disposition. The IPRA recognizes the existence of the indigenous cultural communities or indigenous peoples (ICCs/IPs) as a distinct sector in Philippine society. The ownership given is the indigenous concept of ownership under customary law which traces its origin to native title. . development. and no license. fisheries. and under such terms and conditions as may be provided by law. Republic Act No.the right to stay in the territories. . or lease for the exploration. or utilization of any of the natural resources shall be granted for a period exceeding twenty-five years. concession. or concession at the time of the inauguration of the Government established under this Constitution. The exploration. except as to water rights for irrigation. and mineral lands of the public domain. petroleum. minerals. water supply.LAW ON NATURAL RESOURCES and ENVIRONMENTAL LAW Cases and Special Laws |7 "Sec. in which cases beneficial use may be the measure and the limit of the grant." Simply stated. forests or timber. or production-sharing agreements with Filipino citizens. Other rights are also granted the ICCs/IPs. renewable for not more than twenty-five years. Appropriating Funds Therefor. or industrial uses other than the development of water power. development. Article XIV on the "National Economy and the Patrimony of the Nation. and for Other Purposes." The 1973 Constitution reiterated the Regalian doctrine in Section 8. or industrial uses other than the development of water power. timber. and other mineral oils. 2. or utilization shall be limited to citizens of the Philippines. II.the right in case of displacement. the right to transfer land/property to/among members of the same ICCs/IPs. b. exploitation. all forces of potential energy. joint venture. and other natural resources of the Philippines belong to the State.the right to resolve conflict. all forces of potential energy. and other natural resources of the Philippines belong to the State. industrial or commercial. in which cases beneficial use may be the measure and the limit of the grant. waters. 8371 is entitled "An Act to Recognize. fisheries. wildlife.the right to develop lands and natural resources. With the exception of agricultural." It is simply known as "The Indigenous Peoples Rights Act of 1997" or the IPRA. coal. development and utilization of natural resources shall be under the full control and supervision of the State. development. minerals. petroleum. renewable for not more than twentyfive years. In cases of water rights for irrigation. water supply. and other natural resources are owned by the State. grant. subject to any existing right. and resettlement lands of the public domain. waters. . concession. 1.except as to water rights for irrigation. or to corporations or associations at least sixty per centum of the capital of which is owned by such citizens. wildlife. water supply. 32 . flora and fauna. waters.the right to claim parts of reservations. ." to wit: "Sec. exploitation. shall not be alienated. the right to redemption for a period not exceeding 15 years from date of transfer. if the transfer is to a non-member of the ICC/IP and is tainted by vitiated consent of the 33 ICC/IP. coal. Creating a National Commission on Indigenous Peoples. Such agreements may be for a period not exceeding twenty-five years. or utilization of any of the natural resources shall be granted for a period exceeding twenty-five years. or lease for the exploitation. fisheries. subject to customary laws and traditions of the community concerned." The 1987 Constitution reaffirmed the Regalian doctrine in Section 2 of Article XII on "National Economy and Patrimony. belong to the State. all forces of potential energy. The State may directly undertake such activities or it may enter into co-production. petroleum and other mineral oils. and no license. or if the transfer is for an unconscionable consideration. with the exception of public agricultural land. and other mineral oils. THE INDIGENOUS PEOPLES RIGHTS ACT. . whether on public or private land. and these are: . beneficial use may be the measure and limit of the grant. or corporations or associations at least sixty per centum of whose capital is owned by such citizens. residential. all other natural resources shall not be alienated. or industrial uses other than the development of water power. All agricultural. 8. lease.

the Corolano and Sulod." Indigenous Cultural Communities or Indigenous Peoples refer to a group of people or homogeneous societies who have continuously lived as an organized community on communally bounded and defined territory. Ifugao. the law created the National Commission on Indigenous Peoples (NCIP). Mindanao. possessed and utilized their territories under claim of ownership since time immemorial.Kankaney. the Magahat of Negros Occidental. traditions. Capiz. Hanunuo and Iraya of Oriental and Occidental Mindoro. Cimaron of Sorsogon. and the Palawan and Sulu group of islands. and the right to develop their own sciences and 36 technologies. Tinggian or Itneg.e. Samar. cultural and political institutions. 1. A.000. Indigenous Cultural Communities/ Indigenous Peoples. Itawis of Cagayan. or who have. which is granted quasi-judicial powers. institutions and community intellectual rights. Isarog. When still 39 unresolved. Quezon. Negros. the ICCs/IPs are given the right to self-governance and 34 35 empowerment. who retain some or all of their own social. In the Cordillera Autonomous Region. sharing common bonds of language. or the establishment of present state boundaries. economic.LAW ON NATURAL RESOURCES and ENVIRONMENTAL LAW Cases and Special Laws |8 Within their ancestral domains and ancestral lands. Kalinga.refer to a group of people or homogeneous societies identified by self-ascription and ascription by others. by their resistance to political. the right to preserve and protect their culture.00 and obliged 40 to pay damages. or at the time of inroads of non-indigenous religions and cultures. and who have. Philippine indigenous peoples inhabit the interiors and mountains of Luzon. These groups of people have actually occupied. Cagayan. i. The NCIP's decisions may be appealed to the Court of Appeals by a petition for review. They are composed of 110 tribes and are as follows: 1. 4. Buid or Buhid. Agta. social justice and human rights. Tadyawan of Occidental Mindoro. customs. through resistance to political. social and cultural inroads of colonization. Region II.Magahat of Negros Oriental and Eskaya of Bohol.Region I and the Cordilleras. economic. 3. To carry out the policies of the Act. Palawan. Southern and Eastern Mindanao. ICCs/IPs are defined by the IPRA as: "Sec. cultural and political institutions but who may have been displaced from their traditional territories or who may have resettled outside their ancestral domains. and Central Mindanao. and Kabihug of Camarines Norte. traditions and other distinctive cultural traits. Disputes involving ICCs/IPs are to be resolved under customary laws and practices. Aeta of Cagayan. Leyte. and Mayon of Camarines Sur. Batangan. became historically differentiated from the majority of Filipinos. Palawanon. The term "ICCs" is used in the 1987 Constitution while that of "IPs" is the 41 contemporary international language in the International Labor Organization (ILO) Convention 169 and 42 the United Nations (UN) Draft Declaration on the Rights of Indigenous Peoples. Ilongot of Quirino and Nueva Vizcaya. occupied. non-indigenous religions and cultures. Remontado of Aurora. they. who retain some or all of their own social. Alangan or Mangyan.Aetas. but not limited to. social and cultural inroads of colonization.. Rizal. Northern and Western Mindanao. traditions and other distinctive cultural traits. 5. under claims of ownership since time immemorial. Cuyonon. 3 [h]. 2. Mindoro. the rest of Luzon. Indigenous Peoples: Their History Presently. at the time of conquest or colonization. Aeta-Abiyan. In Region III. Ibanag of Isabela. Rizal. Indigenous Peoples The IPRA is a law dealing with a specific group of people. and the Pullon of Masbate and Camarines Sur. who have continuously lived as organized community on communally bounded and defined territory. Yapayao.Aeta of Camarines Norte and Camarines Sur. Panay and the rest of the 37 Visayas. Any person who violates any of the provisions of the Act such as. In Region V. or. and Bago of Ilocos Norte and Pangasinan. became historically differentiated from the Filipino majority. Quirino and Isabela. Ivatan of Batanes. Bontoc. The NCIP is an independent agency under the Office of the President and is composed of seven (7) Commissioners belonging to ICCs/IPs from each of the ethnographic areas. In Region IV. customs. but who may have been displaced from their traditional domains or who may have resettled outside their ancestral domains. possessed and utilized such territories.000. Island groups including Mindoro.Ati of Negros Occidental. Tagbanua and Tao't bato of Palawan. The NCIP took over the functions of the Office for Northern Cultural Communities and the Office for Southern Cultural Communities created by former President Corazon Aquino which were merged under a 38 revitalized structure. Aeta or Agta or Pugot. ICCs/IPs also include descendants of ICCs/IPs who inhabited the country at the time of conquest or colonization. Itom of Albay. In Region VI. the matter may be brought to the NCIP. Ibaloi. unauthorized and/or unlawful intrusion upon ancestral lands and domains shall be punished in accordance with customary laws or imprisoned from 9 months to 12 years and/or fined from P100. They share common bonds of language.00 to P500.Dumagats of Aurora. non-indigenous religions and cultures. Romblon. Iloilo and Antique. ICCs/IPs shall likewise include peoples who are regarded as indigenous on account of their descent from the populations which inhabited the country. the Indigenous Cultural Communities (ICCs) or the Indigenous Peoples (IPs). . Gaddang of Quirino. 6. In Region VII. Nueva Vizcaya.

" It was the chieftain's duty to rule and govern his subjects and promote their welfare and interests. but which they sensed to be part of their lives. and a host of other deities.There are about 1. From the hinterland. partnership. the animals and birds. Kalagan. the IPs are: the Banwaon. was without sustenance." a term that derived its meaning from the Malay word 52 "balangay. Chinese economic and socio-cultural influences came by way of Chinese porcelain. They fashioned concepts 50 and beliefs about the world that they could not see. were subject to their responsibility to protect the communities from danger and to provide them 61 with the leadership and means of survival. the Philippine archipelago was peopled largely by the Negritos. The strains from these groups eventually gave rise to common cultural features which became the dominant influence in ethnic reformulation in the archipelago. and riverine communities. Ownership of land was non-existent or unimportant and the right of usufruct was what regulated the development of 59 lands. the moon. such as the chieftains and elders. enjoyed some economic privileges and benefits. They believed in the immortality of the soul and life after . divorce.Numbering 1. Basilan and Zamboanga. property rights. 43 death. In Region IX. crime and punishment. Maguindanao. and Iranon. in the environmental spirits and in soul spirits.Ilianen. loans. a boat. for they seemed to consider the objects of Nature as something to be respected. Bukidnon and Misamis Occidental. by virtue of their positions of importance. Region X. legislator and judge and was the supreme commander in time of war. 10. In Region XII. augmented these ethnic strains. Tasaday and Ubo of South Cotabato. Four ethnic groups were within this jurisdiction: Sama. T'boli and Talaingod of Davao del Sur.6 million in Region X alone. Whenever disputes arose. The social order was an extension of the family with chiefs embodying the higher unity of the community. the Kalibugan of Basilan.000 to 30. Tausug. and the Umayamnon of Agusan and Bukidnon. Matigsalog.000 B. Coastal communities depended for their economic welfare on the kind of fishing sharing concept similar to those in land 60 communities. Tiruray. The ancient Filipinos settled beside bodies of water.000 in Tawi-Tawi. Manobo Blit of South Cotabato. family relations and adoption. related to either land and sea. Influences from the Chinese and Indian civilizations in the third or fourth millenium B." meaning. They were preserved in songs and 54 chants and in the memory of the elder persons in the community. The chiefs merely administered the lands in the name of the barangay. Tagakaolo. The generally benign tropical climate and the largely 47 uniform flora and fauna favored similarities. coastal. 53 He was the executive. Mandaya of the Surigao provinces and Davao Oriental. Islam was introduced to the archipelago in Maguindanao.D. Hunting and food gathering became supplementary 46 activities as reliance on them was reduced by fishing and the cultivation of the soil. Marine resources and fishing grounds were likewise free to all. Palawan. Each barangay was different and ruled by a chieftain called a "dato. 8. Other old codes are the 56 Muslim Code of Luwaran and the Principal Code of Sulu. The written laws were those that the 55 chieftain and his elders promulgated from time to time as the necessity arose. Whether customary or written. The early Filipinos adored the sun. Laws were either customary or written. and responded to. the laws dealt with various subjects. The oldest known written body of laws was the Maragtas Code by Datu Sumakwel at about 1250 A. They had their own religion and religious beliefs. Maranao. Sometime in the 13th century. silk and traders. Life was essentially subsistence but not 48 harsh. Community life throughout the archipelago was influenced by.774. How these indigenous peoples came to live in the Philippines goes back to as early as 25. the Samal. Their rituals were based on beliefs in a ranking deity whom they called Bathalang Maykapal. Talaanding of Bukidnon. Customary laws were handed down orally from generation to generation and constituted the bulk of the laws of the barangay. common ecology. Before the time of Western contact." Conflicts arising between subjects of different barangays were resolved by arbitration in which a board composed of 57 elders from neutral barangays acted as arbiters. In Region XI. The early Filipinos had a culture that was basically Malayan in structure and form. the Camiguin of Camiguin Island. They had languages that traced their origin to the Austronesian parent-stock and used them not only as media of daily 49 communication but also as vehicles for the expression of their literary moods. A chieftain had wide powers for he exercised all the functions of government. The Sultanate of Sulu was established and claimed jurisdiction over territorial areas represented today by Tawi-tawi. Tausug. these were decided peacefully through a court composed by the chieftain as "judge" and the barangay elders as "jury. participated in the community ownership of the soil and the instruments of production as a member of the 58 barangay. a basically common way of life where nature was a primary factor. such as inheritance. and Bagobo of Davao del sur and South Cotabato.065 IPs in Region XI. Subanon and Yakat. Langilad.the Badjao numbering about 192. regardless of status. Yakan/Samal. usury.C. Bukidnon. Matigsalog of Davao del Norte and Del Sur. Mansaka of Davao del Norte. therefore. not differences. Each individual. This ancient communalism was practiced in accordance with the concept of mutual sharing of resources so that no individual. our ancestors evolved an essentially homogeneous culture. the Manobo of the Agusan provinces. B'laan. The unit of government was the "barangay. indicating the importance 51 of the relationship between man and the object of nature. the Mangguangon of Davao and South Cotabato. the Tigwahanon of Agusan del Sur. the Higa-unon of Agusan del Norte. But their rights.LAW ON NATURAL RESOURCES and ENVIRONMENTAL LAW Cases and Special Laws |9 7.C. The barangay was basically a family-based community and consisted of thirty to one hundred families. Baranganic society had a distinguishing feature: the absence of private property in land. 9. They venerated almost any object that was close to their daily life. Zamboanga del Sur. Agusan del Sur. 44 Indonesians and Malays. Mamamanua of Surigao del Sur. Recognized leaders. Sulu. They are tribes of the Dibabaon. Misamis Oriental and and Misamis Occidental. Indian 45 influence found their way into the religious-cultural aspect of pre-colonial society. which transported them to these shores.

and the natives were stripped of their ancestral rights to land. The Spaniards did not pursue them into the deep interior. to the hinterlands. The Muslim societies evolved an Asiatic form of feudalism where land was still held in common but was private in use. The pro-Christian or pro-Indio attitude of colonialism brought about a generally mutual feeling of suspicion. This class was favored by the Spaniards and was allowed certain status although below the Spaniards. was a "civilizing" device to make the Filipinos law-abiding citizens of the Spanish Crown. As early as 1551. addressed the existence of the infieles: "In dealing with the uncivilized tribes of the Islands. were now declared to be crown lands or realengas. and divided them into three types . and the cliffs and forests of the hinterlands were difficult and inaccessible. classified the Filipinos according to their religious practices and beliefs. which were peripheral to colonial administration. The Moros and infieles were regarded as the lowest 76 classes. and under which many of those tribes are now living in peace and contentment. the American government chose "to adopt the latter measure as one more in accord with humanity and with 81 the national conscience. The term "non-Christian" referred not to religious belief. The abrogation of the Filipinos' ancestral rights in land and the introduction of the concept of public 73 domain were the most immediate fundamental results of Spanish colonial theory and law. were 75 the Moros or the Muslim communities. to make them ultimately adopt 71 Hispanic culture and civilization. the Commission should adopt the same course followed by Congress in permitting the tribes of our North American Indians to maintain their tribal organization and government. All the new Christian converts were required to construct their houses around the church 70 and the unbaptized were invited to do the same. It was from the realengas that land grants were made to non-Filipinos. First were 62 the Indios. while the infieles. but to a geographical area. The Moros were driven from Manila and the Visayas to Mindanao. 1900. has no provision for the acquisition. It.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 10 Yakan and Subanon. however. the Spanish government assumed an unvarying solicitous attitude towards the 68 natives. usually living in tribal relationship apart 82 from settled communities. The societies encountered by Magellan and Legaspi therefore were primitive economies where most production was geared to the use of the producers and to the fulfillment of kinship obligations. Thus. and third. the Spanish colonialists. to the Spaniards. and. constant and active effort should be exercised to prevent barbarous practices and introduce 80 civilized customs. economic and social systems were kept constantly alive and vibrant. President McKinley. separating themselves from 78 the newly evolved Christian community." ." Placed in an alternative of either letting the natives alone or guiding them in the path of civilization. "to natives of the Philippine Islands of a low grade of civilization. civil and religious. and in the long run. Such tribal government should. they found the Filipinos living in barangay settlements scattered along water routes and river banks. The reduccion. the infieles. The upland societies were naturally outside the immediate concern of Spanish interest. in effect." The Spanish missionaries were ordered to establish pueblos where the church and convent would be constructed. in his instructions to the Philippine Commission of April 7. and hostility between the Christians on the one hand and the non-Christians on the other. cession or sale of 64 land. who generally came from the lowland populations. 77 relative security. One of the first tasks imposed on 67 the missionaries and the encomenderos was to collect all scattered Filipinos together in a reduccion. The Spaniards regarded it a sacred "duty to conscience and humanity to civilize these less fortunate people living in the obscurity of ignorance" and to accord them the "moral and material 69 advantages" of community life and the "protection and vigilance afforded them by the same laws. All lands lost by the old barangays in the process of pueblo organization as well as all lands not assigned to them and the pueblos. and more directly. The Code contains a provision on the lease of cultivated lands. be subjected to wise and firm regulation. The Moros and infieles resisted Spanish rule and Christianity. Their own political. were not only able to preserve their own culture but also thwarted the Christianization process. This is clearly indicated in the Muslim Code of Luwaran. Increasing their foothold in the Philippines. allowing the infieles. Second. the Christianized Filipinos. The Indio was a product of the advent of Spanish culture. They were 65 not economies geared to exchange and profit. The concept that the Spanish king was the owner of everything of value in the Indies or colonies was 74 imposed on the natives. When the Spaniards settled permanently in the Philippines in 1565." The Americans classified the Filipinos into two: the Christian Filipinos and the non-Christian Filipinos. fear. without undue or petty interference. With the reduccion. were the infieles or the indigenous communities. Moreover. surrounded by civilization to which they are unable or unwilling to conform. however. transfer. the Spaniards attempted to "tame" the reluctant Filipinos through Christian indoctrination using the convento/casa real/plaza complex as focal point. Colonialism tended to divide and rule an otherwise culturally and historically related populace through a 79 colonial system that exploited both the virtues and vices of the Filipinos. belonging to the Spanish 72 king. now Lanao del Norte and Lanao del Sur. The Sultanate of Maguindanao spread out from Cotabato toward Maranao 63 territory. the family basis of barangay membership as well as of leadership and governance worked to splinter the population of the islands into numerous small 66 and separate communities.

the Commission on the Settlement of Land Problems was created under E."More importantly this time. and tribal Filipinos. the National Development Company was authorized by law in 1979 to take approximately 40.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 11 Like the Spaniards. The kind of response the indigenous peoples chose to deal with colonial threat worked well to their advantage by making it difficult for Western concepts and religion to erode their customs and traditions. The "infieles societies" which had become peripheral to colonial administration. the "non-Christian tribes" or the "cultural minorities" were addressed by the highest law of the Republic. Timber concessions. they passed Act No. President Aquino created the Office of Muslim Affairs. represented.550 hectares of land that later became the NDC-Guthrie plantation in Agusan 93 del Sur. The 1987 Constitution carries at least six (6) provisions which insure the right of tribal Filipinos to 96 preserve their way of life. while still adopting the integration policy. Most of the land was possessed by the Agusan natives. 410. a tidal wave of Christian settlers from the lowlands of Luzon and the Visayas swamped the highlands and wide 86 open spaces in Mindanao. No. these peoples were also displaced by projects undertaken by the national government in the name of national 87 development. and cattle ranching and other projects of the national government led not only to the eviction of the indigenous peoples from their land but also to the reduction and destruction of their 94 natural environment. Despite the promulgation of these laws. otherwise known as the Ancestral Lands Decree. In 1957. beliefs and interests" were to be considered by the State in the formulation and implementation of State policies. this titling displaced several indigenous peoples from their lands. and interests of national cultural communities in 88 the formulation and implementation of State policies. With government initiative and participation. 561 which provided a mechanism for the 92 expeditious resolution of land problems involving small settlers. The post-independence policy of integration was like the colonial policy of assimilation understood in the context of a guardian85 ward relationship. The decree provided for the issuance of land occupancy certificates to members of the national 91 cultural communities who were given up to 1984 to register their claims. Worse. In Agusan del Sur. Like the Spaniards and Americans." For the first time in Philippine history. No. from 1974 to the early 1980's.000 Kalingas and Bontoks of the Cordillera region were displaced by the Chico River dam project of the National Power Corporation (NPC). water projects. The 1935 Constitution did not carry any policy on the non-Christian Filipinos. plantations. They live in less accessible." The law called for a policy of integration of indigenous peoples into the Philippine 84 mainstream and for this purpose created theCommission on National Integration (CNI). The policy of assimilation and integration did not yield the desired result. Office for Northern Cultural Communities and the Office for Southern Cultural 95 Communities all under the Office of the President. .Invoking her powers under the Freedom Constitution. landowners. the Americans pursued a policy of assimilation . the same task as the BNCT during the American regime. 1888. President Marcos abolished the CNI and transferred its functions to the Presidential Adviser on National Minorities (PANAMIN). In 1974. President Marcos promulgated P. marginal. The Manobos of Bukidnon saw their land bulldozed by the Bukidnon Sugar Industries Company (BUSCO). the State has effectively upheld their right to live in a culture distinctly their own. their "uncivilized" culture was given some recognition and their "customs. They follow ways of life and customs that are perceived as different from those of the rest of the 97 population. They have a system of selfgovernment not dependent upon the laws of the central administration of the Republic of the Philippines. government attempts at integration met with fierce resistance. It was in the 1973 Constitution that the State adopted the following provision: "The State shall consider the customs. and permanent the integration of all said national cultural minorities into the body politic. including those in Muslim Mindanao. The agency took a keen anthropological interest in Philippine cultural minorities and 83 produced a wealth of valuable materials about them. the BNCT's primary task was to conduct ethnographic research among unhispanized Filipinos.O. traditions. 253 creating the Bureau of Non-Christian Tribes (BNCT). Under the Department of the Interior. complete. 2. The Aquino government signified a total shift from the policy of integration to one of preservation. The CNI was given." In short. mining. This Constitution goes further than the 1973 Constitution by expressly guaranteeing the rights of tribal Filipinos to their ancestral domains and ancestral lands. traditions. In 1979. social. By recognizing their right to their ancestral lands and domains. Knowledge by the settlers of the Public Land Acts and the Torrens system resulted in the titling of several ancestral lands in the settlers' names. Since World War II. beliefs.D. moral and political advancement of the non-Christian Filipinos or national cultural minorities and to render real. creating the Commission on National Integration charged with said functions. more or less. an "Act to effectuate in a more rapid and complete manner the economic. the Philippine Congress passed R. and at the same time "protect the 89 rights of those who wish to preserve their original lifeways beside the larger community. with a "special view to determining the most practicable means for bringing about their advancement in civilization and prosperity. Their Concept of Land Indigenous peoples share distinctive traits that set them apart from the Filipino mainstream.A. some 100. the decree recognized the right of tribal Filipinos to preserve their 90 way of life. The raging issue then was the conservation of the national patrimony for the Filipinos. The PANAMIN was tasked to integrate the ethnic groups that sought full integration into the larger community. In 1903. and they were referred to as "cultural communities. No. They are non-Christians." The BNCT was modeled after the bureau dealing with American Indians. mostly upland areas.

Ways and Means. Although highly bent on communal ownership. including the Bangsa Moro. 1476 and 1486 which was a result of six regional consultations and one national 108 consultation with indigenous peoples nationwide.include people. a much older base of archipelagic culture. dispossessed of their ancestral land and with the massive exploitation of their natural resources by the elite among the migrant population. swidden farms. Among the Igorots. and depending on 110 it. At the Second Regular Session of the Tenth Congress. 107 . forest and the animals.A." the right to possess the land does not only belong to the present generation but the future 99 ones as well. Massive migration of their Christian brothers to their homeland shrunk their territory and many of the tribal Filipinos were pushed to the hinterlands. or ownership by residents of the same locality who may not be related by blood or marriage. as a rule. our national land laws and governmental policies frown upon indigenous claims to ancestral lands. economic. and in no case may land be sold to a non-member of the ili. the Indigenous Peoples Rights Act (IPRA) of 1997. as well as Finance. and that those who work the land are its mere stewards. the alienation of individually-owned land is strongly discouraged except in marriage and succession and except to meet sudden financial needs due to sickness. by their joint efforts. 1728 and House Bill No. THE IPRA IS A NOVEL PIECE OF LEGISLATION. III. It adopted almost en toto the comprehensive version of Senate Bill Nos. Under the concept of "trusteeship. Land titles do not exist in the indigenous peoples' economic and social system. have long suffered from the dominance and neglect of government controlled by the majority. they became marginalized. These territories. individual. passed and approved R. And the government has been an indispensable party to this insidious conspiracy against the Indigenous Cultural Communities (ICCs). For the Kalingas. A. plants. There is no traditional concept of permanent. Resisting the intrusion. which was massive during the Commonwealth and early years of the Philippine Republic. The political systems were still structured on the patriarchal and kinship oriented arrangement of power and authority. The Kalingas. not status. Communal 106 ownership is looked upon as inferior. Otherwise. The Legislative History of the IPRA It was to address the centuries-old neglect of the Philippine indigenous peoples that the Tenth Congress of the Philippines. the government passed laws to legitimize the wholesale landgrabbing and provide for 109 easy titling or grant of lands to migrant homesteaders within the traditional areas of the ICCs. and (2) the principle of parens patriae. asserting their rights to it. gave a background on the situation of indigenous peoples in the Philippines. the water. their dwelling. Their survival depends on securing or acquiring land rights. IPs shall cease to exist as distinct peoples. The people are the secondary owners or stewards of the land and that if a member of the tribe ceases to work. The social structure which emphasized division of labor and distinction of functions. Senate Bill No. The system of communal ownership under customary laws draws its meaning from the subsistence and highly collectivized mode of economic production. The IPs culture is the living and irrefutable proof to this. or loss of crops. Flavier. Thus. Principally sponsored by Senator Juan M. customary law on land also sanctions individual ownership. he loses his claim of ownership. Their ancestors had territories over which they ruled themselves and related with other tribes. The economic activities were governed by the concepts of an ancient communalism and mutual help. 1728 was a consolidation of four proposed measures referred to the Committees on Cultural Communities." Senator Flavier further declared: "The IPs are the offsprings and heirs of the peoples who have first inhabited and cared for the land long before any central government was established. socio-cultural and spiritual practices. Their existence as indigenous peoples is manifested in their own lives through political. and to be alienated should first be offered to a clan-member 105 before any village-member can purchase it. foraging for forest products. the mountains. pasture and burial grounds 102 should be communally-owned. Pursuant to the Regalian Doctrine first introduced to our system by Spain through the Royal Decree of 13 February 1894 or the Maura Law. 9125. The cultural styles and forms of life portraying the varieties of social courtesies and ecological adjustments 98 were kept constantly vibrant. death in 104 the family. No. everybody has a common right to a common economic base. It is limited because while the individual owner has the right to use and dispose of the property. in his sponsorship speech. Land is the central element of the indigenous peoples' existence. orchards. Inherently colonial in origin.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 12 from a cultural perspective. Moreover. The residential lots and terrace rice farms are governed by a limited system of individual ownership. This is their environment in its totality. Environment and Natural Resources. Senator Flavier proposed a bill based on two postulates: (1) the concept of native title. The concept of individual land ownership under the civil law is alien to them. It organized and supported the resettlement of people to their ancestral land. Customary law has a strong preference for communal ownership. was maintained." To recognize the rights of the indigenous peoples effectively. ownership of land more accurately applies to the tribal right to use the land or to territorial control. rights and obligations to the land are shared in common. The law was a consolidation of two Bills. Senator Flavier. who are engaged in team occupation like hunting. if not inexistent. for instance. which could either be ownership by a group of individuals or 101 families who are related by blood or by marriage. he does not possess all the rights of an exclusive and full owner as defined under our Civil 103 Code. land ownership. Customary law on land rests on the traditional belief that no one owns the land except the gods and 100 spirits. the air. Under Kalinga customary law. and the land reverts to the beings of the spirit world who are its true and primary owners. 8371. and swidden farming found it natural that forest areas.Senate Bill No.the land. to wit: "The Indigenous Cultural Communities.

. Mr. residential lots. 9125 was sponsored by Rep. continuously to the present except when interrupted by war. residential.Subject to Section 56 hereof. mineral and other natural resources. but not limited to. and lands which may no longer be exclusively occupied by ICCs/IPs but from which they traditionally had access to for their subsistence and traditional activities. worship areas. Senate Bill No. 2874. coastal areas. burial grounds. 1728 was passed on Third Reading by twenty-one (21) Senators voting in favor and none 112 against. No. 705. the hope and the dreams of more than 12 million Filipinos that they be considered 114 in the mainstream of the Philippine society as we fashion for the year 2000. recognized "native title" or "private right" and the existence of ancestral lands and domains. He also emphasized that the rights of IPs to their land was enunciated in Cariño v. These laws. deceit.B. Speaker. agricultural. which." Rep. with no abstention. bodies of water. particularly the home ranges of ICCs/IPs who are still nomadic and/or shifting cultivators. In fact.Subject to Section 56 hereof. b) Ancestral Lands.A. THE PROVISIONS OF THE IPRA DO NOT CONTRAVENE THE CONSTITUTION. Ancestral Domains and Ancestral Lands are the Private Property of Indigenous Peoples and Do Not Constitute Part of the Land of the Public Domain. C." This ruling has 111 not been overturned. its wanton disregard shown during the period unto the Commonwealth and the early years of the Philippine Republic when government organized and supported massive resettlement of the people to the land of the ICCs. the government's obligation to assure and ascertain that these rights shall be well-preserved and the cultural traditions as well as the indigenous laws that remained long before this Republic was established shall be preserved and promoted. filed a bill of similar implications that would promote. and other lands individually owned whether alienable and disposable or otherwise. R. including. House Bill No. was approved on Second Reading with no objections. inland waters. private forests. Despite the passage of these laws. as early as in the 8th Congress. forests. "[w]hile our legal tradition subscribes to the Regalian Doctrine reinstated in Section 2. is our obligation. These are defined in Section 3 [a] and [b] of the Indigenous Peoples Right Act. held under a claim of ownership. The IPRA grants to ICCs/IPs a distinct kind of ownership over ancestral domains and ancestral lands. and natural resources therein.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 13 According to Senator Flavier. The bill was prepared also under the principle of parens patriae inherent in the supreme power of the State and deeply embedded in Philippine legal tradition. communally or individually since time immemorial. in legal concept. refers to land occupied. refer to all areas generally belonging to ICCs/IPs comprising lands. 1728 seeks to genuinely recognize the IPs right to own and possess their ancestral land. is termed "native title. rice terraces or paddies. possessed and utilized by individuals. force majeure or displacement by force. 141. In fact. social and cultural welfare. to look into these matters seriously and early approval of the substitute bill shall bring into reality the aspirations. Gregorio 113 Andolana of North Cotabato. stealth or as a consequence of government projects or any other voluntary dealings entered into by government and private individuals/corporations. Mr. 6734 (the Organic Act for the Autonomous Region of Muslim Mindanao).Ancestral lands are not the same as ancestral domains.D. There is a need. 3 a) Ancestral Domains." Senate Bill No. 9125 is based on the policy of preservation as mandated in the Constitution. continuously. Andolana's sponsorhip speech reads as follows: "This Representation. pasture. occupied or possessed by ICCs/IPs by themselves or through their ancestors. viz: "Sec." This exception was first laid down in the case of Cariño v. and which are necessary to ensure their economic. This principle mandates that persons suffering from serious disadvantage or handicap. and liberally or restrictively. force majeure or displacement by force.A." ." our "decisional laws" and jurisprudence passed by the State have "made exception to the doctrine. to the present except when interrupted by war. After exhaustive interpellation. it was affirmed in subsequent cases. or as a consequence of government projects and other voluntary dealings entered into by government and private individuals/corporations. Speaker. Andolana stressed that H. under claims of individual or traditional group ownership. House Bill No. No. which places them in a position of actual inequality in their relation or transaction with others. 926." Following Cariño. it was more honored in its breach than in its observance. Rep. 410. Article XII of the 1987 Constitution. IV. are entitled to the protection of the State.. deceit. families and clans who are members of the ICCs/IPs since time immemorial. and its corresponding amendments. the State passed Act No. stealth. Apart from this. however. Insular Government which recognized the fact that they had vested rights prior to the establishment of the 115 Spanish and American regimes. Act No. by themselves or through their predecessors-in-interest. hunting grounds. It was originally authored and subsequently presented and defended on the floor by Rep. P. explicitly or implicitly.D. Insular Governmentwhere: "x x x the court has recognized long occupancy of land by an indigenous member of the cultural communities as one of private ownership. Senator Flavier continued: "x x x the executive department of government since the American occupation has not implemented the policy. 1529. swidden farms and tree lots.D. It shall include ancestral lands. P. 9125. Chairman of the Committee on Cultural Communities. Zapata. A. P. recognize the rights of indigenous cultural communities within the framework of national unity and development.

delineation and certification of ancestral lands is in Section 53 of said law. He tried to have the land adjusted under the Spanish land laws. The guiding principle in identification and 120 delineation is self-delineation. They also include lands which may no longer be exclusively occupied by ICCs/IPs but from which they traditionally had access to for their subsistence and traditional activities. Insular 130 Government. 2 allowed the delineation of ancestral domains by special task forces and ensured the issuance of Certificates of Ancestral Land Claims (CALC's) and Certificates of Ancestral Domain Claims (CADC's) to IPs. agricultural. The procedures for claiming ancestral domains and lands are similar to the procedures embodied in Department Administrative Order (DAO) No. have been held under a claim of private ownership by ICCs/IPs. that his grandfather built fences around the property for the holding of cattle and that his father cultivated some parts of the land. He claimed that this land had been possessed and occupied by his ancestors since time immemorial. residential.refers to pre-conquest rights to lands and domains which. DAO No. hunting grounds. coastal areas. swidden farms and tree lots. and natural resources therein and includes ancestral lands. continuously until the present. however. but no 131 document issued from the Spanish Crown. (2) The Concept of Native Title Native title is defined as: "Sec. Native title. Native Title. have never been public lands and 126 are thusindisputably presumed to have been held that way since before the Spanish Conquest. The IPRA categorically declares ancestral lands and domains held by native title as never to have been public land. deceit. mineral and other natural resources. 3 [l]. Upon due application and compliance with the procedure provided under the law and upon finding by the NCIP that the application is meritorious. worship areas. Ancestral lands are lands held by the ICCs/IPs under the same conditions as ancestral domains except that these are limited to lands and that these lands are not merely occupied and possessed but are also utilized by the ICCs/IPs under claims of individual or traditional group ownership. Insular Government 129 The concept of native title in the IPRA was taken from the 1909 case of Cariño v. Ancestral domains comprise lands. shall be embodied in a Certificate of Ancestral Domain Title (CADT). Don Mateo Cariño. private forests. indisputably presumed to have never been public lands and are private. The identification and delineation of these ancestral domains and lands is a power conferred by the IPRA 119 on the National Commission on Indigenous Peoples (NCIP). The procedure for the delineation and recognition of ancestral domains is set forth in Sections 51 and 52 of the IPRA. and other lands individually owned whether alienable or not. Cariño firmly established a concept of private land title that existed irrespective of any royal grant from the State. Formal recognition. CADT's and CALT's issued under the IPRA shall be registered by the NCIP before the Register of Deeds in 125 the place where the property is situated. (a) Cariño v. or (2) by torrens title under the Public Land Act and the Land Registration Act with respect to ancestral lands only. In 1903. The North American colonial government. except when interrupted by war. however. These lands include but 117 are not limited to residential lots. These lands are deemed never to have been public lands and are indisputably presumed to have been held that way since before the Spanish Conquest. Cariño obtained a possessory title to the land under 132 the Spanish Mortgage Law. Like a torrens title. the NCIP shall issue a Certificate of Ancestral Domain Title (CADT) 122 in the name of the community concerned. rice terraces or paddies. which shall recognize the title of the concerned ICCs/IPs 128 over the territories identified and delineated. force majeure or displacement by force. This means that the ICCs/IPs have a decisive role in determining the 121 boundaries of their domains and in all the activities pertinent thereto. Domains and lands held under native title are. Cariño inherited the land in accordance with Igorot custom. The allocation of lands within the ancestral domain to any individual or indigenous corporate (family or clan) claimants is left to the ICCs/IPs concerned to decide in 123 accordance with customs and traditions. is a right of private ownership peculiarly granted to ICCs/IPs over their ancestral lands and domains. burial grounds. series of 1993. (1) Right to Ancestral Domains and Ancestral Lands: How Acquired The rights of the ICCs/IPs to their ancestral domains and ancestral lands may be acquired in two modes: (1) bynative title over both ancestral lands and domains. The identification. pasture. inland waters. forests. a CADT is evidence of private ownership of land by native title. 124 the NCIP issues a Certificate of Ancestral Land Title (CALT). therefore. particularly the home ranges of ICCs/IPs who 116 are still nomadic and/or shifting cultivators. With respect to ancestral lands outside the ancestral domain.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 14 Ancestral domains are all areas belonging to ICCs/IPs held under a claim of ownership. 2. communally or individually since time immemorial. In 1901." Native title refers to ICCs/IPs' preconquest rights to lands and domains held under a claim of private ownership as far back as memory reaches. stealth or as a consequence of government projects or any other voluntary dealings with government and/or private individuals or corporations. bodies of water. when solicited by ICCs/IPs concerned. sought to register with the land registration court 146 hectares of land in Baguio Municipality. an Ibaloi. occupied or possessed by ICCs/IPs by themselves or through their ancestors. Benguet Province. signed by then Secretary of the 118 Department of Environment and Natural Resources (DENR) Angel Alcala. ignored his possessory . The rights of ICCs/IPs to their ancestraldomains (which also include ancestral lands) by virtue of native title shall be 127 recognized and respected. as far back as memory reaches.

When theory is left on one side." The court declared: "The acquisition of the Philippines was not like the settlement of the white race in the United States. The choice was with the new colonizer. irrespective of any royal grant.' In the light of the declaration that we have quoted from section 12. Ultimately. and (2) under a claim of private ownership. however stated.I.of the profoundest factors in human thought. Murciano. and how far it shall recognize actual facts. It is true. and perhaps the general attitude of conquering nations toward people not recognized as entitled to the treatment accorded to those in the same zone of civilization with themselves. the reason for our taking over the Philippines was different.I. we ought to give the applicant the benefit 140 of the doubt.' It is reasonable to suppose that the attitude thus assumed by the United States with regard to what was unquestionably its own is also its attitude in deciding what it will claim for its own." The court thus laid down the presumption of a certain title held (1) as far back as testimony or memory went. and that the land never formed part of the public domain. sovereignty is a question of strength. In other words. How far a new sovereign shall insist upon the theoretical relation of the subjects to the head in the past.S. Supreme Court found no proof that the Spanish decrees did not honor native title. Land held by this title is presumed to "never have been public land. The U.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 15 title and built a public road on the land prompting him to seek a Torrens title to his property in the land 133 registration court. For instance. the U. and never to have been public land. and.S. the Philippine government invoked the Regalian doctrine and contended that Cariño failed to comply with the provisions of the Royal Decree of June 25. perhaps. including Cariño. as against the inhabitants of the Philippines. as against foreign nations. of Benguet which reversed the land registration court and dismissed Cariño's application. Supreme Court noted that it need not accept Spanish doctrines. Cariño took the case to the U. also." Against this presumption.S. The Cariño decision largely rested on the North American constitutionalist's concept of "due process" as 138 well as the pronounced policy "to do justice to the natives. as Spain asserted. which required registration of land claims within a limited period of time. It provides that 'no law shall be enacted in said islands which shall deprive any person of life. while it commands viceroys and others. directs them to confirm those who hold by good grants or justa prescripcion. when it seems proper. liberty. Government appealed to the C. a U. the matter had to be decided under U. we suppose.S. off the land. absolute power. military reservation was proclaimed over his land and. on the other. "Every presumption is and ought to be against the government in a case like the present. The Philippine Supreme 135 Court affirmed the C. Cariño. the United States asserts that Spain had such power. embodied the universal feudal theory that all lands were held from the Crown. Murciano. our first object in the internal administration of the islands is to do justice to the natives.S. not to exploit their country for private gain. Book 4. Law 14 of the the Recopilacion de Leyes de las Indias. or deny to any person therein the equal protection of the laws. embodying the safeguards of the Constitution. On one hand. Certainly in a case like this. or that it meant by "property" only that which had become such by ceremonies of which presumably a large part of the inhabitants never had heard. It is obvious that. In a unanimous decision written by Justice Oliver Wendell Holmes. or deny to any person therein the equal protection of the laws. But it does not follow that. we do not discover such clear proof that it was bad by that law as to satisfy us that he does not own the land. In 1904. extends those safeguards to all." The Court went further: . 1880. viz: "If the applicant's case is to be tried by the law of Spain. and that. 691). Supreme Court analyzed the Spanish decrees upheld in the 1904 decision ofValenton v. by applying the Valenton ruling. in its earlier decrees. or property without due process of law. chapter 1369. be proper and sufficient to say that when. Supreme 136 Court. Both the Government of the Philippine Islands and the U. Whatever consideration may have been shown to the North American Indians.. that in legal theory.S. No one. or property without due process of law.F. the U. 137 are matters for it to decide. the land has been held by individuals under a claim of private ownership.F. On the contrary. To begin with. 1902. and may vary in degree. irrespective of any royal grant. the dominant purpose of the whites in America was to occupy land. would deny that. the older decrees and laws cited by the counsel for the plaintiff in error seem to indicate pretty clearly that the natives were recognized as owning some lands.S. all the property and rights acquired there by the United States are to be administered 'for the benefit of the inhabitants thereof. Spain did not assume to convert all the native inhabitants of the Philippines into trespassers or even into tenants at will. The same statute made a bill of rights. It might. liberty. by native custom and 139 by long association. if there is doubt or ambiguity in the Spanish law. as far back as testimony or memory goes. and that it proposed to treat as public land what they. shortly thereafter. cited for a contrary conclusion in Valenton v." The U.S. like the Constitution.. 3 Philippine 537. It is true that it begins by the characteristic assertion of feudal overlordship and section 12 (32 Statutes at Large. the land registration court granted Cariño's application for absolute ownership to the land. sovereignty is absolute. the United States may assert. so far as consistent with paramount necessities. a military detachment was detailed on the property with orders to keep 134 cattle and trespassers.regarded as their own. By the Organic Act of July 1. it is hard to believe that the United States was ready to declare in the next breath that "any person" did not embrace the inhabitants of Benguet. it will be presumed to have been held in the same way from before the Spanish conquest. The Regalian doctrine declared in the preamble of the Recopilacion was all "theory and discourse" and it was observed that titles were admitted to exist beyond the powers of the Crown. asserted that he was the absolute owner of the land jure gentium. law. While his petition was pending. title 12." It was based on the strong mandate extended to the Islands via the Philippine Bill of 1902 that "No law shall be enacted in said islands which shall deprive any person of life. Supreme Court held: "It is true that Spain. the decrees discussed in Valenton appeared to recognize that the natives owned some land. to call for the exhibition of grants.

Examining Cariño closer." (Emphasis supplied). that the Spanish officials would not have granted to anyone in that province the registration to which formerly the plaintiff was entitled by the Spanish Laws. introducing civilized customs. for the want of ceremonies which the Spaniards would not have permitted and had not the power to 145 enforce. The argument to that effect seems to amount to a denial of native titles through an important part of the Island of Luzon. The court further stated that the Spanish "adjustment" proceedings never held sway over unconquered territories. That was theory and discourse. the Indians have been treated as "in a state of pupilage. and protecting the public forests in which they roamed. at least. Rubi and some Mangyans. It seems probable. This was clearly 150 demonstrated in the case of Rubi v. Private Right and Tribal Land Law. This article was made after Professor Lynch visited over thirty tribal communities throughout the country and studied the origin and 147 development of Philippine land laws. Lynch. filed for habeas corpus claiming deprivation of liberty under the Board Resolution. the court ruled in favor of Cariño and ordered the registration of the 148 hectares in Baguio 144 Municipality in his name.S. It is for the Congress to determine when and how the guardianship shall be terminated. The wording of the Spanish laws were not framed in a manner as to convey to the natives that failure to register what to them has always been their own would mean loss of such land. the U. according to Prof." By recognizing this kind of title. Supreme Court in said case. It upheld government policy promoting the idea that a permanent settlement was the only successful method for educating the Mangyans. but simply to establish it." Thus. by the practice and belief of those among whom he lived. Prof. The registration requirement was "not to confer title. improving their health 151 and morals. the Provincial Board of Mindoro adopted a Resolution authorizing the provincial governor to remove the Mangyans from their domains and place them in a permanent reservation in Sitio Tigbao. the court validated this kind of title. Jr.. Provincial Board of Mindoro. This title was sufficient. . He discussed Cariñoextensively and used the term "native title" to refer to Cariño's title as discussed and upheld by the U. Whatever may have been the technical position of Spain it does not follow that. if not certain. Upon a consideration of the whole case we are of the opinion that law and justice require that the applicant should be granted what he seeks. Supreme Court did not categorically refer to the title it upheld as "native title." it was "not calculated to convey to the mind of an Igorot chief the notion that ancient family possessions were in danger. to admit the possibility that the applicant might have been deprived of his land under Spanish law because of the inherent ambiguity of the decrees and concomitantly. and entitled the holder to a Torrens certificate. even without government administrative action. But precisely because of the ambiguity and of the strong "due 142 process mandate" of the Constitution. it is insisted. We have deemed it proper on that account to notice the possible effect of the change of sovereignty and the act of Congress establishing the fundamental principles now to be observed. Valuable lessons. in his argument. including one who was imprisoned for trying to escape from the reservation. In 1982." The recognized relation between the Government of the United States and the Indians may be described as that of guardian and ward. however. and should not be deprived of what. he had lost all rights and was a mere trespasser when the present government seized his land. the court said: "Reference was made in the President's instructions to the Commission to the policy adopted by the United States for the Indian Tribes. Speaking through Justice Malcolm. It is observed that the widespread use of the term "native title" may be traced to Professor Owen James Lynch. This Court denied the petition on the ground of police power. was his property. if he had read every word of it. in the view of the United States.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 16 the origin of all titles in the King or his predecessors. Any Mangyan who refused to comply was to be imprisoned. Lake Naujan. and even before." This is the only instance when Justice Holmes used the term "native title" in the entire length of the Cariñodecision. It was frank enough. Lynch published an article in the Philippine Law 146 Journal entitled Native Title. can be derived by an investigation of the American-Indian policy. Justice Holmes explained: "It will be perceived that the rights of the applicant under the Spanish law present a problem not without difficulties for courts of a legal tradition.S. through a refined interpretation of an almost 143 forgotten law of Spain." It simply said: "The Province of Benguet was inhabited by a tribe that the Solicitor-General. The Indians are always subject to the plenary authority of the United 152 States. government policy 149 towards ICCs/IPs was consistently made in reference to native Americans. This is not surprising. The fact was that titles were admitted to exist that owed nothing to the powers of Spain beyond this recognition in their 141 books. Professor Lynch stated that the concept of "native title" as defined by 148 Justice Holmes in Cariño "is conceptually similar to "aboriginal title" of the American Indians. on argument. the various interpretations which may be given them. considering that during the American regime. characterized as a savage tribe that never was brought under the civil or military government of the Spanish Crown. (b) Indian Title In a footnote in the same article. The methods followed by the Government of the Philippine Islands in its dealings with the so-called non-Christian people is said. a Visiting Professor at the University of the Philippines College of Law from the Yale University Law School. to be practically identical with that followed by the United States Government in its dealings with the Indian tribes. and which would have made his title beyond question good. In Rubi. the court clearly repudiated the doctrine of Valenton. From the beginning of the United States.

It is a right which exists apart from any treaty. to a considerable extent. Rather. by purchase or conquest. or by whose authority. Supreme Court refused to recognize this conveyance. the courts should not interfere to upset a carefully planned governmental system. said the court. that Indians have been taken from different parts of the country and placed on these reservations. as independent nations." It has been said that the history of America. As to the second point. Their right of possession has never been questioned. Once the discoverer purchased the land from the Indians or conquered them. Indian title to land. entirely disregarded. France. But even admitting similarity of facts. by treaty. It also covers the "aboriginal 156 right of possession or occupancy. the concerned Indians were recognized as the "rightful occupants of the soil. with a legal as well as just claim to retain possession of it." Thus. in order to avoid conflicting settlements and consequent war. Supreme Court on the nature of aboriginal title was made in 1823 in Johnson & Graham's 159 Lessee v. It protected Indian rights and their native lands without having 164 to invalidate conveyances made by the government to many U. the facts in the Standing Bear case and the Rubi case are not exactly identical. in the sense that such lands 157 constitute definable territory occupied exclusively by the particular tribe or nation. just as many forceful reasons exist for the segregation of the Manguianes in Mindoro as existed for the segregation of 153 the different Indian tribes in the United States. and that. The court concluded. proves the universal 163 recognition of this principle. although in numerous instances treaties have been negotiated with Indian tribes. in essence. is not limited to land grants or reservations. They were admitted to be the rightful occupants of the soil. in no instance. Only to the discoverer. however. exercised its right. It may be set apart by an act of Congress.S. The exclusion of all other Europeans gave to the nation making the discovery the sole right of acquiring the soil from the natives and establishing settlements upon it. An Indian reservation is a part of the public domain set apart by proper authority for the use and occupation of a tribe or tribes of 154 Indians. they asserted the ultimate dominion to be in themselves. charged with 162 this right of possession. and claimed and exercised. but in addition.S. citizens. . impaired. no other power could interpose between them. Speaking for the court. which title might be consummated by possession. to establish the principle that discovery gives title to the government by whose subjects. they have been made to remain on the reservation for their own good and for the general good of the country. it was only then that the discoverer gained an absolute title unrestricted by Indian rights.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 17 x x x. In the establishment of these relations. The earliest definitive statement by the U. it is that the determination of this policy is for the legislative and executive branches of the government and that when once so decided upon." The aboriginal right of possession depends on the actual occupancy of the lands in question by the tribe or nation as their ancestral home. from its discovery to the present day. saying: "It has never been contended that the Indian title amounted to nothing. statute. yet it is known to all that Indian reservations do exist in the United States. If any lesson can be drawn from the Indian policy of the United States. the court further stated that: "Those relations which were to exist between the discoverer and the natives were to be regulated by themselves. These grants have been 161 understood by all to convey a title to the grantees. was denied by the fundamental principle that discovery gave exclusive title to those who made it. and to use itaccording to their own discretion. but it cannot be 155 established by custom and prescription. the rights of the original inhabitants were. recognizing their aboriginal possession and delimiting 158 their occupancy rights or settling and adjusting their boundaries. the discoverer of new territory was deemed to have obtained the exclusive right to acquire Indian land and extinguish Indian titles. to whomsoever they pleased.did this right belong and not to any other nation or private person.S. and their power to dispose of the soil at their own will. while yet in possession of the natives. The mere acquisition of the right nonetheless did not extinguish Indian claims to land. or by executive order. as a consequence of this ultimate dominion. when once so located. The rights thus acquired being exclusive. In Johnson. Spain or Holland. Chief Justice Marshall pointed out that the potentates of the old world believed that they had made ample compensation to the inhabitants of the new world by bestowing civilization and Christianity upon them. that a grant of Indian lands by Indians could not convey a title paramount to the title of the United States itself to other parties. the plaintiffs claimed the land in question under two (2) grants made by the chiefs of two (2) Indian tribes. or other governmental action. American jurisprudence recognizes the Indians' or native Americans' rights to land they have held and occupied before the "discovery" of the Americas by the Europeans. with a legal as well as just claim to retain possession of it. the discovery was made. and to the exclusive power of acquiring that right. were necessarily diminished. they found it necessary. subject only to the Indian right of occupancy." Grants made by the discoverer to her subjects of lands occupied by the Indians were held to convey a title to the grantees. without any previous consultation as to their own wishes. until the discoverer." Rubi applied the concept of Indian land grants or reservations in the Philippines. The only conveyance that was recognized was that made by the Indians to the government of the European discoverer. but their rights to complete sovereignty. As regards the natives. but were necessarily. 160 against all other European governments. subject only to the Indian right of occupancy. The claim of government extends to the complete ultimate title. the plaintiffs being private persons. a power to grant the soil. The U.whether to England. While the different nations of Europe respected the right of the natives as occupants. Perhaps. M'Intosh. The Johnson doctrine was a compromise.

The discoverer nonetheless asserted the exclusive right to acquire the Indians' land. Thus. this title was to be consummated by possession and was subject to the Indian title of occupancy. within which their authority is exclusive. It is vulnerable to affirmative action by the federal government who. but the extinguishment of the British power in their neighborhood. and especially that of 1802. The discoverer acknowledged the Indians' legal and just claim to retain possession of the land. aboriginal title is recognized. In this case. then. The U. extinguish the Indian title. which it accorded the protection of complete 171 ownership. the right of individual Indians to share in the tribal property usually depends upon tribal membership." so generally applied to them. It is clear 173 that this right of occupancy based upon aboriginal possession is not a property right. The very term "nation. The plaintiffs. it became accepted doctrine that although fee title to the lands occupied by the Indians when the colonists arrived became vested in the sovereign. which excluded them from intercourse with any other European potentate than the first discoverer of the coast of the particular region claimed: and this was a restriction which those European potentates imposed on themselves. while the different nations of Europe respected the rights of the natives as occupants. by our 168 Constitution and laws.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 18 Johnson was reiterated in the case of Worcester v. they all asserted the ultimate 170 dominion and title to be in themselves. as well as on the Indians. and submitting as subjects to the laws of a master. independent political communities. from their situation. the Indians being the original inhabitants of the land. government to treat the Indians as nations with distinct territorial boundaries and recognize their right of occupancy over all the lands within their domains. subject to its laws and customs. an Indian reservation is a part 180 of the public domain set apart for the use and occupation of a tribe of Indians.with the single exception of that imposed by irresistible power. and for their protection from lawless and injurious intrusions into their country. Georgia. Second. occupying its own territory. The whole intercourse between the United States and this nation is.S. but guaranteed by the United States. is a distinct community. That power was naturally termed their protector. or cession. with boundaries accurately described. Supreme Court declared the Act as unconstitutional for interfering with the treaties established between the United States and the Cherokee nation as well as the Acts of Congress regulating intercourse with them. which is not only acknowledged. Indian land which has been 179 abandoned is deemed to fall into the public domain." The discovery of the American continent gave title to the government of the discoverer as against all 169 other European governments. on the part of the Cherokees. not that of 166 individuals abandoning their national character.S. It characterized the relationship between the United States government and the Indians as: "The Indian nations were. indigenous property . which is still in force. 165 The Cherokee nation. and means mere possession not specifically recognized as ownership by Congress. sometimes called Indian title." x x x. means "a people distinct 167 from others. that they were under the protection of the United States. in which the laws of Georgia can have no force. and of no other power. Designated as the naked fee. The American judiciary struggled for more than 200 years with the ancestral land claims of indigenous 182 Americans. retaining their original natural rights.either by purchase.a right of occupancy in the Indian tribes was nevertheless recognized. Once set apart by proper authority. It entails that land owned by Indian title must be used within the tribe.and in so doing. respect their rights. Thus: "From the commencement of our government Congress has passed acts to regulate trade and intercourse with the Indians. or restrict the nation's power to dispose of." It was the policy of the U. exclusive and continuous use and occupancy for a long time. the reservation ceases to be public land. led naturally to the declaration. no one but 181 Congress can initiate any preferential right on. as sovereign. as the undisputed possessors of the soil from time immemorial. and any violation of the law was deemed a high misdemeanor. and cannot be sold to another 176 sovereign government nor to any citizen. The Federal Government continued the policy of respecting the Indian right of occupancy. aboriginal title is not the same as legal title. All these acts. But this aboriginal Indian interest simply constitutes "permission" from the whites to occupy 172 the land. Aboriginal title rests 175 on actual. x x x. which treat them as nations. As a rule. They assumed the relation with the United States which had before subsisted with Great Britain. necessarily dependent on some foreign potentate for the supply of their essential wants. "The Indian nations had always been considered as distinct. Such title as Indians have to possess and occupy land is in the tribe. They had been arranged under the protection of Great Britain. and manifest a firm purpose to afford that protection which treaties stipulate. and which the citizens of Georgia have no right to enter but with the assent of the Cherokees themselves or in conformity with treaties and with the acts of Congress. Thus. Only the discoverer could extinguish Indian title because it alone asserted ultimate dominion in itself.first the discovering European nation and later the original 13 States and the United States. vested in the government of the United States. who were white missionaries. This relation was that of a nation claiming and receiving the protection of one more powerful. and until the Indian title is extinguished. First. having territorial boundaries. did not obtain said license and were thus charged with a violation of the Act. and having a right to all the lands within those boundaries. the property of the tribe generally being held in communal 177 ownership. them." which is ordinarily used to designate 178 such lands as are subject to sale or other disposal under general laws. And two things are clear. As early as the 19th century. "defensive" conquest. possessed exclusive power to extinguish 174 the right of occupancy at will. On the other hand. manifestly consider the several Indian nations as distinct political communities. and not in the individual Indian. and the establishment of that of the United States in its place. the State of Georgia enacted a law requiring all white persons residing within the Cherokee nation to obtain a license or permit from the Governor of Georgia. Indian lands are not included in the term "public lands.

This option is limited to ancestral lands only. Director of Lands that the court declared that the rule that all lands that were not acquired from the government. open 194 and adverse possession in the concept of owner of thirty years both for ordinary citizens and members 192 of the national cultural minorities that converts the land from public into private and entitles the registrant to a torrens certificate of title. The protection of aboriginal title merely guards against encroachment by persons other than 185 the Federal Government. residential.Individual members of cultural communities. which claims are uncontested by the members of the same ICCs/IPs. pasture. ipso 191 jure. however." ICCs/IPs are given the option to secure a torrens certificate of title over their individually-owned ancestral lands. title to the land. provided. Oh Cho. The aboriginal title of ownership is not specifically recognized as ownership by action authorized by 184 Congress. they are agricultural in character and are actually used for agricultural. the IPRA expressly converts ancestral land into public agricultural land which may be disposed of by the State.A. The IPRA. as successor of the discoverer. as amended. not communally. of the land to the ICCs/IPs. or the Land Registration Act 496. Ancestral lands that are owned by individual members of ICCs/IPs who. The long line of cases citing Cariño did not touch on native title and the private character of ancestral domains and lands. This exception would be any land that should have been in the possession of an occupant and of his predecessors-in-interest since time immemorial. continuous. 195 . Native title presumes that the land is private and was never public. From a legal point of view. For this purpose. open and adverse possession in the concept of owner of public agricultural land. The private character of ancestral lands and domains as laid down in the IPRA is further strengthened by the option given to individual ICCs/IPs over their individually-owned ancestral lands. by 189 190 operation of law.S. has to be first converted to public agricultural land simply for registration purposes. It was only in the case of Oh Cho v. is still in its infancy and any similarities between its application in the Philippines vis-à-vis American Jurisprudence on aboriginal title will depend on the peculiar facts of each case. with respect to their individuallyowned ancestral lands who. All these years. as amended. by themselves or through their predecessors-in-interest.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 19 systems are also recognized. The land ceases to be part of the public domain. either by purchase or grant. It is this long. Although there are criticisms against the refusal to recognize the native 186 Americans' ownership of these lands.S. To wit: "Sec. and is converted to private property by the mere lapse or completion of the prescribed statutory period. however. however. certain benefits can be drawn from a comparison 183 of Philippine IPs to native Americans. Cariño was cited by the succeeding cases to support the concept of acquisitive prescription under the Public Land Act which is a different matter altogether. 141. and such lands must be individually. For purposes of registration. including those with a slope of eighteen percent (18%) or more. These lands shall be classified as public agricultural lands regardless of whether they have a slope of 18% or more. 12. continuous. (c) Why the Cariño doctrine is unique In the Philippines. are hereby classified as alienable and disposable agricultural lands. the possessor of the land is deemed to have acquired. The option granted under this section shall be exercised within twenty (20) years from the approval of this 196 Act. is deemed to have passed to the U. Cariño had been quoted out of context simply to justify long. recognizes the possessory rights of the Indians over their land. Option to Secure Certificate of Title Under Commonwealth Act 141. For purposes of registration under the Public Land Act and the Land Registration Act. or Act 496. It is this kind of possession that would justify the presumption that the land had never been part of the public domain or that it had been 193 private property even before the Spanish conquest. Cariño is the only case that specifically and categorically recognizes native title. land sought to be registered must be public agricultural land. Under the IPRA. the power of the State to extinguish these titles has remained 187 firmly entrenched. have been in continuous possession and occupation of the same in the concept 197 of owner since time immemorial or for a period of not less than 30 years. The U. by themselves or through their predecessors-in-interest. (3) The Option of Securing a Torrens Title to the Ancestral Land Indicates that the Land is Private. belong to the public domain has an exception. When the conditions specified in Section 48 [b] of the Public Land Act are complied with. The necessary implication is thatancestral land is private. which are agricultural in character and actually used for agricultural. Under the Public Land Act. the Land Registration Act. have been in continuous possession and occupation of the same in the concept of owner since time immemorial or for a period of not less than thirty (30) years immediately preceding the approval of this Act and uncontested by the members of the same ICCs/IPs shall have the option to secure title to their ancestral lands under the provisions of Commonwealth Act 141. may be registered under C. a right to a grant of the land. It. otherwise known as the Public Land Act. the individually-owned ancestral lands are classified as alienable and disposable agricultural lands of the public domain. was decided under the provisions of the Public Land Act and Cariño was cited to support the applicant's claim of acquisitive prescription under the said Act. the Philippine State is not barred form asserting sovereignty over the ancestral domains 188 and ancestral lands. residential. Despite the similarities between native title and aboriginal title. or the Land Registration Act 496. there are at present some misgivings on whether jurisprudence on American Indians may be cited authoritatively in the Philippines. and tree farming purposes. however. pasture and tree farming purposes. owned. said individually-owned ancestral lands. however. not domains. albeit in limited form. the concept of native title first upheld in Cariño and enshrined in the IPRA grants ownership.

to have a free patent issued to him for such tract or tracts of such land not to exceed twenty-four hectares. continuous. exclusive. the IPRA itself converts his ancestral land. and harkens to Section 44 of the Public Land Act on administrative legalization (free patent) of imperfect or incomplete titles and Section 48 (b) and (c) of the same Act on the judicial confirmation of imperfect or incomplete titles. for at least thirty years immediately preceding the filing of the application for confirmation of title except when prevented by war or force majeure. exclusive and notorious possession and occupation of lands of the public domain suitable to agriculture. 1997. Since ancestral domains and lands are private. This ownership is based on adverse possession for a specified period. a tract or tracts of land. either by himself or through his predecessors-in-interest. may apply to the Court of First Instance of the province where the land is located for confirmation of their claims and the issuance of a certificate of title therefor. nor in any manner become private property. (c) Members of the national cultural minorities who by themselves or through their predecessors-in-interest have been in open. if the ICC/IP wants to avail of the benefits of C. Registration under the Public Land Act and Land Registration Act recognizes the concept of ownership under thecivil law. Land and space are of vital concern in terms of 201 sheer survival of the ICCs/IPs. This option must be exercised within twenty (20) years from October 29. have ceased to be so. under a bona fide claim of acquisition or ownership. These shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of this Chapter. The spirit of the IPRA lies in the distinct concept of ancestral domains and ancestral lands. (b) Those who by themselves or through their predecessors-in-interest have been in open. Open. Thus: "Sec. Section 3 of Article XII on National Economy and Patrimony of the 1987 Constitution classifies lands of the public domain into four categories: (a) agricultural. or who shall have paid the real estate tax thereon while the same has not been occupied by any person shall be entitled.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 20 The classification of ancestral land as public agricultural land is in compliance with the requirements of the Public Land Act and the Land Registration Act. A member of the national cultural minorities who has continuously occupied and cultivated. a tract or tracts of agricultural public lands subject to disposition. whether disposable or not. 141 and Act 496. allows registration only of private lands and public agricultural lands. continuous. and notorious possession and occupation of agricultural lands of the public domain. The following described citizens of the Philippines." It is the recognition of the ICCs/IPs distinct rights of ownership over their ancestral domains and lands that breathes life into this constitutional mandate. but whose titles have not been perfected or completed. shall be entitled to the right granted in the preceding paragraph of this section:Provided. nor those on which a private right authorized and recognized by this Act or any other valid law x x x or which having been reserved or 199 appropriated. Its provisions apply to those lands "declared open to disposition or concession" x x x "which have not been reserved for public or quasi-public purposes. has continuously occupied and cultivated. Thus. the land has become private. whether disposable or not since July 4. 1955. . The option to register land under the Public Land Act and the Land Registration Act has nonetheless a limited period. The 1987 Constitution mandates the State to "protect the rights of indigenous cultural communities to their ancestral lands" and that "Congress provide for the applicability of customary laws x x x in 202 determining the ownership and extent of ancestral domain.A. and (d) national parks." Act 496. 1955 (free patent) or at least thirty years (judicial confirmation). The right of ownership and possession by the ICCs/IPs of their ancestral domains is a limited form of ownership and does not include the right to alienate the same. Section 5 of the same Article XII mentions ancestral lands and ancestral domains but it does not classify them under any of the said four categories. (c) mineral lands. 200 regardless of whether the land has a slope of eighteen per cent (18%) or over. occupying lands of the public domain or claiming to own any such lands or an interest therein. either by himself or through his predecessors-in-interest. x x x. 141. To classify them as public lands under any one of the four classes will render the entire IPRA law a nullity. nor appropriated by the Government. "Sec. under a bona fide claim of ownership for at least 30 years shall be entitled to the rights 204 granted in sub-section (b) hereof. deals specifically with 198 lands of the public domain. Any natural-born citizen of the Philippines who is not the owner of more than twenty-four hectares and who since July fourth. the Public Land Act. 44. public and continuous possession is sufficient. 48. ancestral lands and ancestral domains are not part of the lands of the public domain. under the provisions of this chapter. under the Land Registration Act. C." Registration under the foregoing provisions presumes that the land was originally public agricultural land but because of adverse possession since July 4. B.A. the Land Registration Act. (b) forest or timber. 1926 or prior thereto. from private to public agricultural land for proper disposition. They are private and belong to the ICCs/IPs. the date of approval of the IPRA. That at the time he files his free patent application he is not the owner of any real property secured or 203 disposable under the provision of the Public Land Law. The IPRA addresses the major problem of the ICCs/IPs which is loss of land. to wit: (a) [perfection of Spanish titles] xxx. adverse.

much less corporate condominium rights. which shall recognize the title of the concerned ICCs/IPs over the territories identified and delineated. The possession has to be confirmed judicially or administratively after which a torrens title is issued. insofar as his share is concerned.. intimate tillage. The ancestral domain is owned in common by the ICCs/IPs and not by one particular person. The Civil Code of the Philippines defines ownership in Articles 427. Every stockholder has the right to disassociate Following the constitutional mandate that "customary law govern property rights or relations in 216 determining the ownership and extent of ancestral domains. when duly proven. and the mutuality of blessings between 222 man and land. by legislative fiat. care for land. It is private simply because it is not part of the public domain. 214 Moreover.by sheer force of having sprung from the land since time beyond recall. The Indigenous Concept of Ownership and Customary Law. to the domain. present and future. in the absence of any applicable provision in the Civil 220 Code. can define rights and liabilities. Its recognition does not depend on the absence of a specific provision in the civil law. Communal rights over land are not the same as corporate rights over real property. the right to consume 206 207 the thing by its use. Thus: "Sec. disposed or destroyed. (b) in accord with customary laws and traditions. It belongs to the ICCs/IPs as a community. It primarily includes the right of the owner to enjoy and dispose of the thing owned. the corporation itself may be dissolved voluntarily or Communal rights to the land are held not only by the present possessors of the land but extends to all generations of the ICCs/IPs. Some articles of the Civil Code expressly provide that custom should be applied in cases where no 219 codal provision is applicable. 428 and 429. A torrens title recognizes the owner whose name appears in the certificate as entitled to all the rights of ownership under the civil law. from man. the possessor makes proper application therefor. and (c) subject to the right of redemption of the ICCs/IPs for a period of 15 years if the land was transferred to a non-member of the ICCs/IPs. under Roman Law. The Civil Code expressly provides that "no coowner shall be obliged to remain in the co-ownership. whether 209 delineated or not. This concept is based on Roman Law which the Spaniards introduced to the Philippines through the Civil Code of 1889. past. and the faithful nurture of the land by the sweat of one's brow. however. To allow such a right over ancestral domains may be destructive not only of customary law of the community but of the very community 212 itself. being people of the land.. encumber. Co-ownership gives any co-owner the right to demand partition of the property held in common. And the right to enjoy and 205 dispose of the thing includes the right to receive from the thing what it produces. These communal rights. to wit: "Sec. This is the reason why the ancestral domain must be kept within the ICCs/IPs themselves. The indigenous concept of ownership under customary law is specifically acknowledged and recognized. The domain cannot be transferred. 5. The IPRA itself provides that areas within the ancestral domains. Ancestral lands are also held under the indigenous concept of ownership. 1. may be exercised over things or rights. To be sure. sold or conveyed to other persons.Indigenous concept of ownership sustains the view that ancestral domains and all resources found therein shall serve as the material bases of their cultural integrity." Each co-owner may demand at any time the 211 partition of the thing in common. A corporation can exist only for a maximum of fifty (50) years subject to an 213 extension of another fifty years in any single instance. Customary law is a primary. Formal recognition. not secondary. and the right to exclude from the possession of the thing owned by any other person to whom the owner has 208 not transmitted such thing.The rights of ICCs/IPs to their ancestral domains by virtue of Native Title shall be recognized and respected. The CADT is merely a "formal recognition" of native title. The lands are communal. custom. 11. the indigenous concept of ownership exists even without a paper title. are not 210 exactly the same as co-ownership rights under the Civil Code. from the land. is also recognized under the Civil Code as a source of 218 law. This is clear from Section 11 of the IPRA. source of rights under the IPRA and uniquely applies to ICCs/IPs. 215 involuntarily. and 221 coexists with the civil law concept and the laws on land titling and land registration. from which customary law is derived. This is fidelity of usufructuary relation to the landthe possession of stewardship through perduring." the IPRA. This concept maintains the view that ancestral domains are the ICCs/IPs private but community property. This is a concept that has long existed under customary law. himself from the corporation." The moral import of ancestral domain. The CADT formally recognizes the indigenous concept of ownership of the ICCs/IPs over their ancestral domain. when solicited by ICCs/IPs concerned shall be embodied in a Certificate of Ancestral Domain Title. introduces a 217 new concept of ownership. are presumed to be communally held.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 21 provided. The indigenous concept of ownership generally holds that ancestral domains are the ICCs/IPs private but community property which belongs to all generations and therefore cannot be sold. These lands. Recognition of Ancestral Domain Rights. sustenance for man. Ownership of ancestral domains by native title does not entitle the ICC/IP to a torrens title but to a Certificate of Ancestral Domain Title (CADT). however. It likewise covers sustainable traditional resource rights. the right to alienate. But its private character ends there. native land or being native is "belongingness" to the land. Ownership. . transform or even destroy the thing owned. Custom. Indigenous concept of ownership." The right of ownership and possession of the ICCs/IPs to their ancestral domains is held under the indigenous concept of ownership. In other words. may be transferred subject to the following limitations: (a) only to the members of the same ICCs/IPs.

(d) traditional hunting and fishing grounds. (c) sacred places. Section 7 provides for the rights over ancestral domains: "Sec. the State shall endeavor to resettle the displaced ICCs/IPs in suitable areas where they can have temporary life support systems: x x x. the transferor ICC/IP shall have the right to redeem the same within a period not exceeding fifteen (15) years from the date of transfer. Section 8 governs their rights to ancestral lands. that will affect or impact upon the ancestral domains and to receive just and fair compensation for any damages which they may sustain as a result of the project. the right to develop. The Rights of ICCs/IPs Over Their Ancestral Domains and Lands The IPRA grants the ICCs/IPs several rights over their ancestral domains and ancestral lands.. (b) bodies of water traditionally and actually occupied by the ICCs/IPs. x x x. to a non-member of the concerned ICCs/IPs is tainted by the vitiated consent of the ICCs/IPs.The right to claim ownership over lands. and only in default thereof shall the complaints be submitted to amicable settlement and to the Courts of Justice whenever necessary. 8. control and use lands and territories traditionally occupied. except those reserved and intended for common and public welfare and service. 7. (d) the right to regulate the entry of migrants. (c) the right to resettlement in case of displacement. pursuant to national and customary laws.Right to resolve land conflicts in accordance with customary laws of the area where the land is located. Unlike ownership over the ancestral domains." Section 7 (a) defines the ICCs/IPs the right of ownership over their ancestral domains which covers (a) lands. b) Right to Develop Lands and Natural Resources. and (g) the right to resolve conflict in accordance with customary laws. alienation and encroachment upon these rights. the ICCs/IPs shall have access to integrated systems for the management of their inland waters and air space. but not to domains. owned. f) Right to Safe and Clean Air and Water.. the right to negotiate the terms and conditions for the exploration of natural resources in the areas for the purpose of ensuring ecological. Sections 7 (a). The Right of ICCs/IPs to Develop Lands and Natural Resources Within the Ancestral Domains Does Not Deprive the State of Ownership Over the Natural Resources and Control and Supervision in their Development and Exploitation. Article XII of the 1987 Constitution.In case displacement occurs as a result of natural catastrophes. (e) the right to safe and clean air and water.-For this purpose. h) Right to Resolve Conflict.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 22 C. a) Right to transfer land/property. or used. The right of ownership includes the following rights: (1) the right to develop lands and natural resources. or is transferred for an unconscionable consideration or price. to benefit and share the profits from allocation and utilization of the natural resources found therein. Rights to Ancestral Lands.... Section 8 gives the ICCs/IPs also the right to transfer the land or property rights to members of the same ICCs/IPs or non-members thereof. and (e) all improvements made by them at any time within the domains. (b) the right to stay in the territories.. nor through any means other than eminent domain.The rights of ownership and possession of ICCs/IPs to their ancestral domains shall be recognized and protected. Such rights include: a) Right of Ownership. No ICCs/IPs will be relocated without their free and prior informed consent. b) Right to Redemption. 1. bodies of water traditionally and actually occupied by ICCs/IPs. This is in keeping with the option given to ICCs/IPs to secure a torrens title over the ancestrallands. (f) the right to claim parts of the ancestral domains as reservations.. government or private. 2.The right of ownership and possession of the ICCs/IPs to their ancestral lands shall be recognized and protected.Right to regulate the entry of migrant settlers and organizations into their domains." c) Right to Stay in the Territories. . Rights to Ancestral Domains. to manage and conserve natural resources within the territories and uphold the responsibilities for future generations.The right to claim parts of the ancestral domains which have been reserved for various purposes. . the right to an informed and intelligent participation in the formulation and implementation of any project. d) Right in Case of Displacement.. subject to customary laws and traditions of the community concerned. g) Right to Claim Parts of Reservations.Subject to Section 56 hereof.. sacred places." Section 8 provides for the rights over ancestral lands: "Sec. e) Right to Regulate the Entry of Migrants. and the right to effective measures by the government to prevent any interference with.Such right shall include the right to transfer land or property rights to/among members of the same ICCs/IPs. 7 (b) and 57 of the IPRA Do Not Violate the Regalian Doctrine Enshrined in Section 2. environmental protection and the conservation measures.The right to stay in the territory and not to be removed therefrom.. traditional hunting and fishing grounds. and all improvements made by them at any time within the domains.In cases where it is shown that the transfer of land/property rights by virtue of any agreement or devise.

A. or. joint venture or production-sharing.. fisheries. co-production. management and utilization of natural resources is declared in Section 2. minerals. bays. minerals. all forces of potential energy. viz: "Sec. The President shall notify the Congress of every contract entered into in accordance with this provision. water supply. forests or timber. fisheries. and other mineral oils according to the general terms and conditions provided by law. traditional hunting and fishing grounds. and utilization of minerals. coal. The exploration. or 2. renewable for not more than twentyfive years.petroleum and other mineral oils. the State. flora and fauna in the traditional hunting grounds. fisheries. minerals. petroleum. and may undertake the same in four (4) modes: 1. forests or timber. (R. joint venture or production-sharing agreements with Filipino citizens or qualified corporations.are owned by the State. by law. or production-sharing agreements with Filipino citizens. and all improvements made by them at any time within the domains. it may enter into co-production. all forces of potential energy. The Congress may. 4. with priority to subsistence fishermen and fishworkers in rivers.waters. The State. The right of ICCs/IPs in their ancestral domains includesownership. or industrial uses other than the development of water power." Examining the IPRA. there is nothing in the law that grants to the ICCs/IPs ownership over the natural resources within their ancestral domains. 7. sacred places. coal. beneficial use may be the measure and limit of the grant. or production-sharing agreements. petroleum and other mineral oils. minerals." The ICCs/IPs are given the right to claim ownership over "lands. and other mineral oils. as well as cooperative fish farming. and other natural resources are owned by the State. water supply. With the exception of agricultural lands. territorial sea. fisheries. For the large-scale exploration. the State exercises full control and supervision. wildlife. through Congress. development. and reserve its use and enjoyment exclusively to Filipino citizens. and other mineral oils.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 23 The Regalian doctrine on the ownership. development and utilization of these natural resources . joint venture. petroleum and other mineral oils. i. 3. The President may enter into agreements with foreign-owned corporations involving either technical or financial assistance for large-scale exploration. specifically minerals. The State shall protect the nation's marine wealth in its archipelagic waters. Article XII of the 1987 Constitution as belonging to the State. bodies of water traditionally and actually occupied by ICCs/IPs. etc. sacred places. by law. the right of ownership under Section 7 (a) does not cover "waters.flora and fauna and all other natural resources" enumerated in Section 2. the state shall promote the development and use of local scientific and technical resources. the State is accorded primary power and responsibility in the exploration. and exclusive economic zone. These agreements may be for a period of 25 years. All lands of the public domain. but this "ownership" is expressly defined and limited in Section 7 (a) as: "Sec. and lagoons. or. and utilization of natural resources shall be under the full control and supervision of the State. development and utilization of these natural resources. Article XII of the 1987 Constitution. and all other natural resources found within the ancestral domains. forests or timber. The State may enter into co-production. Congress may. fish in the traditional fishing grounds. Such agreements may be for a period not exceeding twenty-five years. 2. development and utilization of minerals. and all improvements made by them at any time within the domains. The non-inclusion of ownership by the ICCs/IPs over the natural resources in Section 7(a) complies with the Regalian doctrine. flora and fauna. For the large-scale exploration of these resources. flora and fauna. forests or timber in the sacred places. petroleum. allow small-scale utilization of natural resources by Filipino citizens. In such agreements. wildlife. ." It will be noted that this enumeration does not mention bodies of water not occupied by the ICCs/IPs. The Constitution provides that in the exploration. Under the Philippine Mining Act of 1995. coal.The right to claim ownership over lands. all other natural resources shall not be alienated. all forces of potential energy. renewable for another 25 years. Indeed. or corporations or associations at least sixty per centum of whose capital is owned by such citizens. bodies of water traditionally and actually occupied by ICCs/IPs." All lands of the public domain and all natural resources. joint venture. wildlife. wildlife. and other natural resources. petroleum. and under such terms and conditions as may be provided by law. 223 within thirty days from its execution. may enter into technical and financial assistance agreements with foreign-owned corporations. the President may enter into agreements with foreign-owned corporations involving technical or financial assistance. development. 7076) the three types of agreements. coal. may allow the smallscale utilization of natural resources by Filipino citizens. The State may directly undertake such activities.A. 7942) and the People's Small-Scale Mining Act of 1991 (R. As owner of the natural resources. lakes. traditional hunting and fishing grounds. The State may directly undertake such activities. through the President. may apply 227 228 to both large-scale and small-scale mining. "Small-scale mining" refers to "mining activities which rely heavily on manual labor using simple implements and methods and do not use explosives or heavy mining 229 equipment. based on real contributions to the economic growth and general welfare of the country. waters. The State may directly undertake the exploitation and development by itself. allow small-scale utilization of natural resources by Filipino citizens. In cases of water rights for irrigation. it may allow participation by the private sector through co224 225 226 production. a) Right of ownership.e. fisheries.

f) the right to effective measures by the government to prevent any interference with." It must be noted that the right to negotiate the terms and conditions over the natural resources covers only their exploration which must be for the purpose of ensuring ecological and environmental protection of. pursuant to national and customary laws. 7 (b) of the IPRA Is Allowed Under Paragraph 3. Section 2 of Article XII of the Constitution. the ICCs/IPs must ensure that the natural resources within their ancestral domains are conserved for future generations and that the "Section 1. b) the right to manage and conserve natural resources within the territories and uphold the responsibilities for future generations. right to exclude and right to recover ownership. that will affect or impact upon the ancestral domains and to receive just and fair compensation for any damages which they may sustain as a result of the project." The term "natural resources" is not one of those expressly mentioned in Section 7 (a) of the law. Part II. waters and natural resources.Subject to Section 56 hereof. the right to an informed and intelligent participation in the formulation and . government or private. government or private. the right to use. however. and the right to effective measures by the government to prevent any interference with. "benefit and share" the profits from their allocation and utilization. Section 7 (a) speaks of the right of ownership only over the land within the ancestral domain. Nevertheless. that will affect or impact upon the ancestral domains and to receive just and fair compensation for any damages which they may sustain as a result of the project. and "negotiate the terms and conditions for their exploration" for the purpose of "ensuring ecological and environmental protection and conservation measures. or used. Rights of Ownership. the right over the fruits. These rights shall include. Rule III of the Implementing Rules goes beyond the parameters of Section 7 (b) of the law and is contrary to Section 2. and these provisions. Article XII of the 1987 Constitution. as shall be discussed later. It does not extend to the exploitation and development of natural resources. Part II. right to consume. it is necessary to declare that the inclusion of "natural resources" in Section 1. right to develop. 7 (b) Right to Develop Lands and Natural Resources. c) the right to benefit and share the profits from the allocation and utilization of the natural resources found therein. (b) The Small-Scale Utilization of Natural Resources In Sec. the right to possess. The IPRA itself makes a distinction between land and natural resources.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 24 (a) Section 1. For the ICCs/IPs may use these resources and share in the profits of their utilization or negotiate the terms for their exploration. e) the right to an informed and intelligent participation in the formulation and implementation of any project. Ownership over the natural resources in the ancestral domains remains with the State and the ICCs/IPs are merely granted the right to "manage and conserve" them for future generations. environmental protection and the conservation measures. alienation and encroachment upon these rights. viz: "Sec. waters. and conservation measures in the ancestral domain. Ownership over natural resources remain with the State and the IPRA in Section 7 (b) merely grants the ICCs/IPs the right to manage them. and natural resources and all improvements made by them at any time within the ancestral domains/ lands." Section 1 of the Implementing Rules gives the ICCs/IPs rights of ownership over "lands. the ICCs/IPs' rights over the natural resources take the form of management or stewardship. control and use lands and territories traditionally occupied.. the right to negotiate the terms and conditions for the exploration of natural resources in the areas for the purpose of ensuring ecological. 7 (a) of the IPRA And is Unconstitutional. ICCs/IPs have rights of ownership over lands. and the rights or interests over land and natural resources." The right to develop lands and natural resources under Section 7 (b) of the IPRA enumerates the following rights: a) the right to develop. to benefit and share the profits from allocation and utilization of the natural resources found therein. environmental protection and the conservation measures. Rule III reads: implementation of any project. Rule III of the Implementing Rules Goes Beyond the Parameters of Sec. control and use lands and territories traditionally occupied. The constitutionality of Section 1. It is Sections 7 (b) and 57 of the law that speak of natural resources. alienation 233 and encroachment upon these rights. Part II. to avoid any confusion in the implementation of the law. d) the right to negotiate the terms and conditions for the exploration of natural resources for the purpose of ensuring ecological. Petitioners actually assail the constitutionality of the 232 Implementing Rules in general. owned. Part II. At the same time. The right to recover shall be particularly applied to lands lost through fraud or any form or vitiated consent or transferred for an unconscionable price. to manage and conserve natural resourceswithin the territories and uphold the responsibilities for future generations. Rule III of the Implementing Rules was not specifically and categorically challenged by petitioners. Our Constitution and jurisprudence clearly declare that the right to claim ownership over land does not necessarily include the right to claim ownership over the natural resources found on or under the 231 land. but not limited to. pursuant to national and customary laws. do not give the ICCs/IPs the right of ownership over these resources. Simply stated. The Rules Implementing the IPRA 230 in Section 1.

the law only grants the ICCs/IPs "priority rights" in the development or exploitation thereof. necessarily reject utilization in a largescale. whether natural or juridical. The ICCs/IPs must undertake such endeavour always under State supervision or control. it is an affirmation of the said doctrine that all natural resources found within the ancestral domains belong to the State. Neither is the State stripped of ownership and control of the natural resources by the following provision: . The law recognizes the probability of requiring a non-member of the ICCs/IPs to participate in the development and utilization of the natural resources and thereby allows such participation for a period of not more than 25 years. Article XII of the 1987 Constitution in relation to Section 57 of IPRA. The limited rights of "management and use" in Section 7 (b) must be taken to contemplate small-scale utilization of natural resources as distinguished from large-scale. Rather. development and utilization of minerals. A non-member of the ICCs/IPs concerned may be allowed to take part in the development and utilization of the natural resources for a period of not exceeding twenty-five (25) years renewable for not more than twenty-five (25) years: Provided. or (2) it may recognize the priority rights of the ICCs/IPs by entering into an agreement with them for such development and exploitation. a priority in their large-scale development and exploitation.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 25 "utilization" of these resources must not harm the ecology and environment pursuant to national and 234 customary laws. by their very nature." The terms "harvesting. or production-sharing agreement with them." Section 57 speaks of the "harvesting. extraction. in the large-scale utilization of natural resources within the ancestral domains. It is utilization not merely for subsistence but for commercial or other extensive 236 use that require technology other than manual labor. The agreement shall be for a period of 25 years. If the State decides to enter into an agreement with a non-ICC/IP member. Natural Resources within Ancestral Domains. or allow such non-member to participate in its agreement with the ICCs/IPs. It incorporates by implication the Regalian doctrine. whether natural or juridical. as owner of these resources. Small-scale utilization of natural resources is expressly allowed in the third paragraph of Section 2. Article XII of the 1987 Constitution. has agreed to allow such operation: Provided finally. requires that the provision be read in the light of Section 2. Section 57 of the IPRA does not give the ICCs/IPs the right to "manage and conserve" the natural resources. Article XII of the Constitution "in recognition of the plight of forest dwellers. Moreover. The grant of priority rights implies that there is a superior entity that owns these resources and this entity has the power to grant preferential rights over the resources to whosoever itself chooses. or (3) it may enter into an agreement with a non-member of the ICCs/IPs. renewable for another 25 years. This indicates that the State does not lose control and ownership over the resources even in their exploitation. local or foreign. Section 2. it may recognize the priority rights of the ICCs/IPs as owners of the land on which the natural resources are found by entering into a co-production. the State. which duties. development or exploitation of any natural resources within the ancestral domains. pursuant to its own decision-making process. renewable for another 25 years. That a formal and written agreement is entered into with the ICCs/IPs concerned or that the community. development or exploitation of natural resources within ancestral domains" and "gives the ICCs/IPs 'priority rights' therein. extraction. That the NCIP may exercise visitorial powers and take appropriate action to safeguard the rights of the ICCs/IPs under the same contract. and at the same time. as owners and occupants of the land on which the resources are found. extraction. as owner of these natural resources. (c) The Large-Scale Utilization of Natural Resources In Section 57 of the IPRA Is Allowed Under Paragraphs 1 and 4. The rights granted by the IPRA to the ICCs/IPs over the natural resources in their ancestral domains merely gives the ICCs/IPs. The State has several options and it is within its discretion to choose which option to pursue. of and by itself. To reiterate. there is nothing in the law that gives the ICCs/IPs the right to solely undertake the large-scale development of the natural resources within their domains. or (4) it may allow such non-member to participate in the agreement with the ICCs/IPs." Section 7 (b) also expressly mandates the ICCs/IPs to manage and conserve these resources and ensure environmental and ecological protection within the domains. directly undertake the development and exploitation of the natural resources. Section 57 is not a repudiation of the Regalian doctrine. as actual occupants of the land where the natural resources lie.. marginal fishermen and others similarly situated 235 who exploit our natural resources for their daily sustenance and survival. joint venture. the National Commission on Indigenous Peoples (NCIP) shall ensure that the rights of the ICCs/IPs under the agreement shall be protected. may directly undertake the development and exploitation of the natural resources by itself. development or exploitation" of any natural resources within the ancestral domains obviously refer to large-scale utilization. Section 57 of the IPRA provides: "Sec. the right to the small-scale utilization of these resources. the State. Priority means giving preference. 237 Article XII of the 1987 Constitution. Having priority rights over the natural resources does not necessarily mean ownership rights. Section 57 does not mandate the State to automatically give priority to the ICCs/IPs. The State may likewise enter into any of said agreements with a non-member of the ICCs/IPs. Instead. has four (4) options: (1) it may. 57. hence.The ICCs/IPs shall have priority rights in theharvesting. and other mineral oils. or in the alternative. gold panners. have traditionally utilized these resources for their subsistence and survival. This may be done on condition that a formal written agreement be entered into by the non-member and members of the ICCs/IPs. Sections 7 (b) and 57 of the law simply give due respect to the ICCs/IPs who. petroleum. or enter into agreements with foreign-owned corporations involving either technical or financial assistance for the large-scale exploration. Interpreting Section 2.

Developments in international law made it appropriate to adopt new international standards on indigenous peoples "with a view to removing the assimilationist orientation of the earlier standards. The movement received a massive impetus during the 1960's from two sources. Second. Aborigines in Australia. This policy has provided an influential model for the 244 projects of the Asian Development Bank. It was the Cordillera People's Alliance that carried out successful campaigns against the building of the Chico River Dam in 1981-82 and they have 240 since become one of the best-organized indigenous bodies in the world. the indigenous peoples. or production sharing agreement while there is a pending application for a CADT: Provided. the right of self-determination was enshrined in the UN Declaration on Human 238 Rights. The rise of the civil rights movement and anti-racism brought to the attention of North American Indians. ILO Convention No. renewing or granting any concession. there is a growing concern for indigenous rights in the international scene. and during the 1980's. specifically. further. programs and specific rules concerning IPs in some nations. Note that the certification applies to agreements over natural resources that do not necessarily lie within the ancestral domains.All departments and other governmental agencies shall henceforth be strictly enjoined from issuing. That the ICCs/IPs shall have the right to stop or suspend. ILO Convention No." and recognizing the aspirations of these peoples to exercise control over their own 250 institutions. license. and many other international instruments on the prevention of 249 discrimination. lease. without prior certification from the NCIP that the area affected does not overlap with any ancestral domain." Concessions. and Maori in New Zealand the possibility of fighting for fundamental rights and freedoms. THE IPRA IS A RECOGNITION OF OUR ACTIVE PARTICIPATION IN THE INDIGENOUS INTERNATIONAL MOVEMENT. The histories and cultures of the indigenes are relevant to the evolution of Philippine culture and 252 are vital to the understanding of contemporary problems. and is heavily influenced by both the International Labor Organization (ILO) Convention 169 and the United Nations 247 (UN) Draft Declaration on the Rights of Indigenous Peoples. Presently. The NCIP certification shall be issued only after a field-based investigation shall have been conducted and the free and prior informed written consent of the ICCs/IPs obtained. license or lease. It merely gives the NCIP the authority to ensure that the ICCs/IPs have been informed of the agreement and that their consent thereto has been obtained. this provision requires as a precondition for the issuance of any concession. V. that a certification be issued by the NCIP that the area subject of the agreement does not lie within any ancestral domain. The IPRA 246 amalgamates the Philippine category of ICCs with the international category of IPs. International institutions and bodies have realized the necessity of applying policies. 169 is entitled the "Convention Concerning Indigenous and Tribal Peoples in 248 Independent Countries" and was adopted on June 27. Non-compliance with the consultation requirement gives the ICCs/IPs the right to stop or suspend any project granted by any department or government agency. or entering into any production-sharing agreement. for example. government agency or government-owned or -controlled corporation may issue new concession. the International Covenant on Economic. The provision does not vest the NCIP with power over the other agencies of the State as to determine whether to grant or deny any concession or license or agreement. Social and Cultural Rights. first adopted a policy on IPs as 243 a result of the dismal experience of projects in Latin America. 169 revised the "Convention Concerning the Protection and Integration of Indigenous and Other Tribal and Semi-Tribal Populations in Independent Countries" (ILO No. and have become a part of today's priorities for the international agenda. That no certification shall be issued by the NCIP without the free and prior informed and written consent of the ICCs/IPs concerned: Provided. lease or production-sharing agreements for the exploitation of natural resources shall not be issued. Such certification shall only be issued after a fieldbased investigation is conducted by the Ancestral Domains Office of the area concerned: Provided. The people of the Philippine Cordillera were the first 239 Asians to take part in the international indigenous movement. finally. international indigenous organizations were founded." CONCLUSION The struggle of the Filipinos throughout colonial history had been plagued by ethnic and religious differences. As its subtitle suggests. renewed or granted by all departments and government agencies without prior certification from the NCIP that the area subject of the agreement does not overlap with any ancestral domain. The indigenous movement can be seen as the heir to a history of anti-imperialism stretching back to prehistoric times. That no department. Largely unpopulist. in accordance with this Act. 1957. the International Covenant on Civil and Political Rights. the present legal system has resulted in the alienation of a large sector of society. The 1987 Philippine Constitution formally recognizes the existence of ICCs/IPs and declares as a State 245 policy the promotion of their rights within the framework of national unity and development. the decolonization of Asia and Africa brought into the limelight the possibility of peoples controlling their own destinies. ways of life and economic development. First. This came as a result of the increased publicity focused on the continuing disrespect for indigenous human rights and the destruction of the indigenous peoples' environment. It is based on the Universal Declaration of Human Rights. In 1974 and 1975. Sections 7(b) and 57 of the IPRA apply. Indigenous rights came as a result of both human rights and environmental 242 protection. licenses. 107) passed on June 26. Certification Precondition. The World Bank. license or agreement over natural resources. any project that has not satisfied the requirement of this consultation process. 1989. For those that are found within the said domains.. These differences were carried over and magnified by the Philippine government through the 251 imposition of a national legal order that is mostly foreign in origin or derivation. together with the national governments' inability to 241 deal with the situation. It is through the IPRA that an attempt was . indigenous affairs were on the international agenda. The World Bank now seeks to apply its current policy on IPs to some of its projects in Asia.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 26 "Section 59.

20 Ponce.000 to 30. 11 Id. pp. 25 Peña. 7 Phil. supra. p. 40 Section 73. 8371. at 32. p. [1989]. Their relatively inferior culture did not enable them to overcome the pressures from the second wave of people. the Indonesians A and B who came in 5. 125-126. Antonio H. Inc. Insular Government. 44 How these people came to the Philippines may be explained by two theories. 1. Tan. 37 Sections 38 and 40. suggests a random and unstructured advent of different kinds of groups in the archipelago—Samuel K. 8 Ponce.D. 48 SCRA 372. 5 Antonio H. p. supra. Noblejas. 8371. these grants were better known as repartimientos and encomiendas. Noblejas. published by the Manila Studies Association. at 557. Their cultural remains are preserved by the Negrito-type Filipinos found in Luzon. 41 Convention Conerning Indigenous and Tribal Peoples in Independent Countries. Footnotes 1 2 23 24 Chief Judge. 27 Phil. supra. at 545-546. Murciano. 27 Ponce.C. US Court of Appeals for the Seventh Circuit. 29 Id. Tiglao v. Lourdes Aranal-Sereno and Roan Libarios. 46 Onofre D. 31 Ibid. 9 3 Phil. suggests the "wave theory"—a series of arrivals in the archipelago bringing in different types and levels of culture. The geographic distribution of the ethnolinguistic groups. that the Ifugaos of Northern Luzon built the rice terraces—Id. F.A.. 67. at 600-601. 10 Id. Gaddang. 7 Phil. and the Philippine National Historical society. 39 Section 69. at 15. 34 Sections 13 to 20. at 33. 28 2 Aruego. lowland and downstream areas. Summer 2000. 26 [1982]. also cited in Ponce. racially or culturally. Senior Lecturer. Ponce. 58 P. 43 Taken from the list of IPs sbmitted by Rep. supra. p. all decided by the Philippine Supreme Court. One view. p. Director of Lands. 537 [1904]. Valenton was applied in Cansino v. 1997. No. came between 25. 420. vol. at 32. p. Alfredo Evangelista. 21 Montano v. 33 Section 8. Land Titles and Deeds. which shows overlapping of otherwise similar racial strains in both upland and lowland cultures or coastal and inland communities.500 A. p. The University of Chicago Law Review. at 35-36. at 600.J. supra. Inc. 17 Id. These comments by the court are clear expressions of the concept that Crown holdings embraced both imperium and dominium—Ma.C. 320 [1906]. They are represented today by the Kalinga. Registration of Land Titles and Deeds.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 27 made by our legislators to understand Filipino society not in terms of myths and biases but through common experiences in the course of history. 13 [1964]. pp. 19 Please see Section 70. 573.Lee Hong Hok v. 5 [1986]. supra. See also Florencio D. 14 Id. supra. Corpuz.000 B. 3. p. supra. at 32. at 543.C. 33-34 [1997]. A second view is postulated by Robert Fox. With the foregoing disquisitions. citing Benitez. 1989. 13. Indonesians and Malays stand co-equal as ethnic groups without any one being dominant. at 543-544. 42 Guide to R. The encomiendas were given to Spaniards to administer and develop with the right to receive and enjoy for themselves the tributes of the natives assigned to them.D. 4 Valenton v. i. Mandaya. 7 The Mortgage Law is a misnomer because it is primarily a law on registration of property and secondarily a mortgage law. 537. at 123-124. supra. Isneg. History of the Philippines. University of Chicago Law School. 32 Section 7. Mangyan.A. p. p. 12 Phil. Andolana to the house of Representatives during the deliberations on H.. Noblejas. Jocano maintains that the Negritos. p. Valdez. and Cariño v. 38 Sections 74 to 77. They are represented by the Christianized and Islamized Filipinos who pushed the Indonesian groups inland and occupied much of the coastal. Land Titles and Deeds. Tagbanua. .000 and 3.500 B. 12. and Jesus Peralta. June 27. 80 [1906]. Landa Jocana. 00086-00095. Aklahi foundation. Teodoro A. 423 [1983]. Vol. 26 Noblejas. 22 Archbishop of Manila v. 21 [1990]. at 542-543.e.. 6 Narciso Pena. 3 Dominium is distinguished from imperium which is the government authority possessed by the state expressed in the concept of sovereignty. generally linked to Professor Otley H. Visayas and Mindanao. The Philippine Torrens System. 543 [1904]. The Roots of the Filipino Nation. at 33. Philippine Centennial (1898-1998) Edition. The Interface Between National Land Law and Kalinga Land Law.B. also cited in Ponce. pp. Subanon. and Sama. Insular Government. No. Repartimientos were handouts to the military as fitting reward for their services to the Spanish crown. 2 [1994]. 6 Phil. The first group was pushed inland as the second occupied the coastal and downriver settlements. 35 Sections 21 to 28.000 A. at 32. Insular Government. If the evolution of the Filipino people into a democratic society is to truly proceed democratically. they had a more advanced culture based on metal age technology. at 548. Beyer. 377 [1972]. 45 Tan. 592 [1937]. 20. 18 Id. Manobo. 250 [1961]. "lost tribes" such as the Lutangan and Tatang have not been included. Noblejas. It was in 800-1. supra. 4 [1999]—hereinafter referred to as Guide to R.Ponce. 30 Id. at 543. The Negritos. at 553-554.Ponce. 9125—Interpellations of Aug. 15 Id. Inc. dark-skinned pygmies. 3 Phil. and 1. published by the Coalition for Ips Rights and ancestral Domains in cooperation with the ILO and Bilance-Asia Department. supra.R. History of the Filipino People. The Philippines became a democracy a centennial ago and the decolonization process still continues. Ponce. at 16. at 540. 12 Id. David.L. The Framing of the Philippine Constitution. 245 [1914]. 36 Sections 29 to 37. 132 [1906]. I vote to uphold the constitutionality of the Indigenous Peoples Rights Act of 1997. A History of the Philippines. 13 Id. supra. 16 Id. Registration of Land Titles and Deeds. The last wave involved Malay migrations between 500 B. at 37. if the Filipinos as a whole are to participate fully in the task of 253 continuing democratization. it is this Court's duty to acknowledge the presence of indigenous and customary laws in the country and affirm their co-existence with the land laws in our national legal system. at 32. Act 926. 572 [1909]. Agoncillo.

Id.unpublished work submitted as entry to the Centennial Essay-Writing Contest sponsored by the National Centennial Commission and the Supreme Court in 1997. Indigenous Peoples of the Philippines. Cayat. Nos. 10 [1976]. UP Law Center. there was only one recorded transaction on the purchase of land. Indigenous People of the Philippines. Cayat. Insular Government. at 47-48. 66 Corpuz. 1. at 80. par. 102 Ma. L. and Recommendations. 61 Id. citing the Decree of the Governor-General of the Philippines. Indigenous Peoples of the Philippines. the Philippine Indigenous Era Prior to 1565. and Article XVI.I..O. supra. . at 21. 90 The PANAMIN. Memorandum of the Secretary of the Interior. Res. 58 Renato Constantino. Cayat. infra. 100 Abelardo. 64 Cacho v. 58 P. 29-30 [n. 28 Phil. Land Use and Ownership and Public Policy in the Cordillera. 1973 Constitution. 52 Agoncillo. Indigenous Attitudes Toward Land and Natural Resources of Tribal Filipinos. 22. ed. 139-140 [1988]. L. at 277-278. Inc. traditions.J. Customs Laws in PreConquest Philippines.L. 12. at 43-44. History of the Filipino People. at 42. 97 MacDonald. sec.. Bontok Land Tenure (UP Law library. 660. pp. 1991.. 1. see also Note 131. N. Ancestral Domain Rights: Issues. sec. 103 Ibid. The History of the Judicial System in the Philippines. 69 Id. at 52-53. at 5-6. Agoncillo. quoted in Rubi v. unpublished work submitted as entry to the Centennial Essay-Writing Contest sponsored by the National Centennial Commission and the Supreme Court in 1997. 17 [1939]. 1888 of 1957. 68 Phil. The Interface of National Land Law and Kalinga Law. beliefs. p. The preamble of E. 85 See People v. 38 [1975]. at 25. at 40-41. p. at 80. see also Ponce. Article XIII. 11-12 [1964].-Dec. Jr. Ancestral Domain Recognition in the Philippines: Trends in Jurisprudence and Legislation. 440-441 [1983]. 79 Id. p. Whether in the implementation of these decrees the natives’ ancestral rights to land wereactually respected was not discussed by the U. 80 81 People v. at 120-121. p.d. 420. militarization and intimidation. In Mindanao. 12. at 48-49. 68 Phil. Nat. 63 Id. 616. Bennagen. a history of Sulu genealogy. supra. at 693. 78 Id. Abelardo. Article XII. however. p. The BNCT made a Bontok and subanon ethnography. the agency resorted to a policy of forced resettlement on reservations. 95 E. vol. 17 [1939]. 43 [1997]. supra. But see discussion in Cariño v. at 99. 31 National Council of Churches in the Philippines Newsletter. Fernandez. because the government failed to release the decree’s implementing rules and regulations. Provincial Board of Mindoro. and interests. Kingsburry. 39 Phil. 49 Teodoro A.—Owen J. The purchase price for the island was a gold salakot and a long gold necklace – Agoncillo. Lourdes Aranal-Sereno and Roan Libarios. supra. 5 Phil. supra.H. supra.. published by the Manila Studies Ass’n. sec. supra. 714 [1919]. See also Rubi v. Ateneo Law Journal. at 349-350. at 93-94. 47-48 [1992]. Provincial Board of Mindoro. No. 92 [1993]. Ancestral Domain Rights. 62 Tan. at 53. A. Supreme Court. Indigenous Peoples of Asia.S. at 40.B. 625-627 [1914]. Cayat. at 345. 75 Tan. 55 Agoncillo."bajo el son de la campana" (under the sound of the bell) or "bajo el toque de la campana"(Under the peal of the bell). xxx" 96 Article II. at 49-50. and projects for tribal Filipinos. 39 Phil. sec. supra. Tan. where the United States Supreme Court found that the Spanish decrees in the Philippines appeared to recognize that the natives owned some land. Provincial Board of Mindoro. 73 Id.. at 13. 60 Id. pp. 70 Agoncillo. 87 The construction of the Ambuklao and Binga dams in the 1950’s resulted in the eviction of hundreds of Ibaloi families – Cerilo Rico S. Article XIV. at 39. 94 MacDonald. at 55. supra. 89 Presidential Decrees Nos. Inc. Gray and B. 67 Resettlement. 122-B states: "Believing that the new government is committed to formulate more vigorous policies. at 41. 93 Id. 50 Corpuz.. Gatmaytan. also cited in Dante B. Barnes. supra. supra. 14. 91 No occupancy certificates were issued. 77 Id.J. at 4-9. taking into consideration their communal aspirations. citing Perfecto V. programs. 54 [1990].A. No. at 17-18. plans. by R. Jan. No. 59 Samuel K. and a compilation on unhispanized peoples in northern Luzon. 103. 694 [1919] 86 MacDonald. p. at 277. concentrated funds and resources on image-building. Indigenous Era Prior to 1565. Responses. Indigenous Peoples of the Philippines. at 98-99. at 17. 17. p.]. The Maragtas Code tells us of the purchase of Panay Island by ten Bornean datus led by Datu Puti from the Atis under Marikudo in the 13th century. 82 Rubi v. supra. at 67. otherwise known as Indigenous Cultural Communities. 54 Rafael Iriarte. at 351. 71 Id. Indigenous Peoples of the Philippines: Between Segregation and Integration . A History of the Philippines. however. supra. 122-A.MacDonald. publicity. mimeographed). and impact projects. 104 Ibid. 12. 65 Constantino. 5. In Philippine pre-colonial history. also cited in People v. supra. 1017 and 1414. at 5. Note 177. 122-B and 122-C. sec. 348. at 351. 63 P. citing June Prill-Brett. XV. 72 Corpuz. 92 Id. 101 Id. at 38. 105 Ibid. 99 Cordillera Studies Program. The Philippine Torrens System. J. customs. No. pub. p. 6.Abelardo. 51 Id. 98 Samuel K. Art. by Association for Asian Studies [1995]. 84 R. History of the Judicial System. supra. supra. Lynch. 660. supra. 88 Section 11. Tan. and the Phil. supra. sec. Oct. at 44-45. Article VI. 76 Id. supra. 1887. 5. The Philippine Colonial Dichotomy: Attraction and Disenfranchisement. 57 Agoncillo. supra.O. 68 People v. infra.. 38. 74 Id. National Historical Society. Government of the P. A Past Revisited . 54 [1997]. 2. 53 Id. A History of the Philippines.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 28 47 48 Id. 56 Amelia Alonzo. in order to promote and preserve their rich cultural heritage and insure their participation in the country’s development for national unity. 83 Charles Macdonald. citing Ponciano L.

8371.S.42 C. Igorot Descendants Claim Rights to Camp John Hay. 249. 142 Aranal-Sereno and Libarios.. The Interface Between Kalinga Land Law. supra.L. Aumentado. Germino. 00107-00108. Tatad. Cohn and Clarke sold the land to the U. Records. affirmed 62 S. 1996. 1894. Second Regular Session. Note 164.J. Singson. at 940. 1997.J. 138 Ibid. 5. Indians. Order No. instead of by treaty. IPRA. The bill was reported out. 28 [1944 ed. Maceda. at 941. It is observed that the first two kinds may include lands possessed by aboriginal title. Ermita. 124 A CALT refers to a title formally recognizing the rights of the ICCs/IPs over their ancestral lands. Romualdo. 1. 249. Sec. IPRA. 122 A CADT refers to a title formally recognizing the right of possession and ownership of ICCs/IPs over their ancestral domains identified and delineated in acordance with the IPRA—Rule II [c]. 268. NCIP Admin. 112 Journal of the Tenth Congress of the Philippines. 20. Lynch. Sec. Invisible Peoples. . 146 57 P. 132 [1906]. the bill filed by Senators Rasul and Macapagal-Arroyo was never sponsored and deliberated upon in the floor. Cariño. 86-87. Second Regular Session.L. or its representatives in the Philippines. 144 Certificate of Title No. 29 citing Sioux Tribe of Indians v. 152 Id. p. Cariño. Sec. 935 (1909). 150 39 Phil. 4. Indians. p. 121 Guide to R.]. IPRA. Langit. 111 Id. 155 There are 3 kinds of Indian reservations: (a) those created by treaties prior to 1871. 141 Id. 29 [1944 ed. 94 Ct. 765 [June 1998]. 116 Section 3 [a]. 143 Id. 7 Pacific Rim Law & Policy Journal.Ed. Andolana of House Bill No. 212 U. 136 In 1901. Ct.L. but to his lawyers John Hausserman and Charles Cohn and his attorney-infact Metcalf Clarke. pp. 128 Ibid. 139 Id. 150. 631. Invisible Peoples and a Hidden Agenda: The Origins of Contemporary Philippine Land Laws (1900-1913).J. 147 From 1987 to 1988.S. 123 Section 53 [a]. however. 449. IPRA. 12. Cosalan. Recto. 112. by statute. Damasing. 119 Section 44 [e]. Customary Title. 149 Lynch.J. IPRA. Senate.]. The note obliged Cariño to sell the land at issue "as soon as he obtains from the Government of the United States. 109 Id. Jr. 137 Cariño v. through Senators Rasul. No.L. supra at 428-This artcile was one of those circulated among the Constitutional Commissioners in the formulation of Sec.J. supra. In that year. Indian affairs have been regulated by acts if Congress and by contracts with the Indian tribes practically amounting to treaties. Government in a Deed of Quitclaim-Richel B. 82 [1988]. Aug. Plaza.J. at 17-18. Article XII of the 1987 Constitution (4 Record of the Constitutional Commission 33). Implementing Rules. 317. 13. at 939. certiorari granted 62 S. at 939. 5. Abad. 15-16. 63 P. 1194. 117 Section 3 [b]. 660 [1919].Maureen Tehan. 1908.S. at 420. Indians. Sec. 125 Section 52 [k]. Until 1871. 9125. U. Land Rights." Please see the Legal Bases of Philippine Colonial Sovereignty: An Inquiry. at 290. Congress. pp. 2 covering the 148 hectares of Baguio Municipality was issued not in the name of Cariño who died on June 6. Ct. 86 L. Hausserman. 170. Indian tribes were recognized by the United States as possessing the attributes of nations to the extent that treaties were made with them. 113 Co-authors of the bill were Reps. de la Cruz. 151 Id. Senate. 131 It was the practice of the Spanish colonial government not to issue titles to Igorots —Owen J.O. citing Government’s Exhibit G. IPRA. p. supra. Fua.S. Honasan. 135 7 Phil.J. 63 P. Legislative History of SBN 1728. 1.S. Calalay.A. 114 Sponsorship speech of Rep.A. Luciano. Osmena and Romulo. The Interface.. Native Titles. March 20. 1095. 1728 was co-sponsored by Senator Macapagal-Arroyo and co-authored by Senators Alvarez.m. Invisible Peoples.J. 1. History of SBN 1728. at 941-942. 110 Id. No. 53 L. 108 Sponsorship Speech of Senator Flavier. at 288-289. 00061." See Lynch. 1997. Enrile. Ed. 14. IPRA. merchant in Manila. and (c) those made by Executive Orders where the President has set apart public lands for the use of the Indians in order to keep them within a certain territory. Land Laws and Land Usurpation: The Spanish Era (1568-1898). Revilla.L. 145 Id. Leg. Ed. sponsored an interpellated but never enacted into law. Estrada and Romulo filed a bill to operationalize the mandate of the 1987 Constitution on indigenous peoples. citing the testimony of Benguet Provincial Governnor William F.S. The Eighth Congress. at 712-713. 130 Sponsorship Speech of Senator Juan Flavier. Mercado. Pack. 133 Later named Camp John Hay. p. 3. IPRA. Manila Times. 1997. 140 Id. real and definitive title. 293. In the Ninth Congress. 1998.J. Senate Bill No. 63 P. at 944. 63 P. 127 Section 11. Rules & Regulations Implementing the IPRA. Verceles —Proceedings of Sept.Rule II [d]. Tenth Congress. 118 Guide to R. 129 41 Phil. Magsaysay. Shahani. at 694. 293-296 [1982]. pp. 1501. Tenth Congress. 5-6.S. Since then. 13. 1996. 315 U. at 137-138. 154 42 C.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 29 106 107 Ma.L. supra. (b) those created by acts of Congress since 1871. p. Invisible Peoples and a Hidden Agenda: The Origins of Contemporary Philippine Land Laws (1900-1913). and Property Rights in Australia: Emerging Patterns of Land Use in the Post-Mabo Era. 62 P. Heritage Protection. at 13. 120 Section 51. 126 Section 3 [1]. 132 Maura Law or the Royal Decree of Feb. 6:16 p. Records at 47. 115 Interpellation of Aug. at 700. Oct.S. p.L. Lourdes Aranal-Sereno and Roan Libarios. to publish parts of his doctoral dissertation at the Yale Law School entitled "Invisible Peoples: A History of Philippine Land Law. The last kind covers Indian reservations proper.41 Am Jur 2d. 316 U.S. 148 "Native title" is a common law recognition of pre-existing aboriginal land interests in Autsralia. Teves. NCIP A. 16. declared its intention thereafter to make the Indian tribes amenable directly to the power and authority of the United States by the immediate exercise of its legislative power over them. 55 [1995 ed]. 288 [1988]. Session No. Montilla. Cariño had entered into a promissory agreement with a U.. 1997.J. Oct. Lynch allowed the P. p. 134 Lynch. 15. 594. Bautista.. 8371. supra. 153 Id. 156 42 C. Indians. Jan. Cl. 16. Prof. 86 L. The Colonial Dichotomy: Attraction and Disenfranchisement. 790. 279 [1987]. Insular Government. at 12.

Intermediate Appellate Court.] 181 Ibid.R. 1992]. Ed. Proof and Extinguishment of Aboriginal title to Indian Lands. Ed. 48-49 [1947]. the naked fee. 163 Buttz v. and utilized a defined territory devolved to them.. 146 SCRA 509 [1986]. 94 S Ct. 110 [1919]. Some have their own government-recognized constitutions. Indigenous Peoples of the Philippines: Between Segregation and Integration. Ct.R.Ed. Ed. v. 32 S. at Sec. Sec. Shoshone Tribe of Indians. 225 U.. 345.Aboriginal Title to Indian Lands. Ed. Original Indian Title. 58 [1995 ed]. Sec.S.S. 67 S. v. see also 41 Am Jur 2d. Native Title. Dak. IPRA. 249 U. Texas International Law Journal. Committee on Native American Struggles 1982).S.]. 1213.S. 8 L. 314 U.. possessing the right to change and grow.S. 629. Annotation: Proof and Extinguishment of Aboriginal Title to Indian Lands. Ct. Choate v.S. 170 Buttz v.Northern P..S. On January 25.S. 48 [b] and 48 [c] were further amended by P. v. 201 Charles MacDonald. Co. 339. Native Title. creation of a reservation. 82 L. 95 SCRA 437 [1980].S.Missouri. 184 Dante Gatmaytan.Ed. 517. The Earth is Our Mother: Struggles for American Indian Land and Liberation in the Contemporary United States. at 293.]. 86 L. supra.A. Alcea Bank of Tillamooks. 1977. exclusive and continuous use and occupancy for a long time prior to the loss of the property. at Secs. 1987 Constitution. supra. Santa Fe Pac.. certain ICCs/Ips are known to have occupied. 82 L. Dak. 780 [1912]. Ct. Sec. 335 [1886]. 3872 in 1964. F. U. by the terms of the treaty. 161 Id. 190 Ibid. Ed. U. 582.. the U. 24 L. Indians. Buyco. 172 Ibid. infra.. U. and Indian Law Resource Center.hereinafter cited as Aboriginal Title to Indian Lands. 32 Minn. 202 Section 5. R. Co. 32: 97. 119 U.33 S. 368 [1913]. grazing district. Ct. Colonization and Resistance 139 (M. 272. 200 The classification of ancestral lands 18% in slope or over as alienable in the IPRA is an exception to Section 15. 665 [1912]. v. Cohen.Please see Republic v.S. 62 S. Jaimes 1992). Co. 431. supra. 248. 188 See Discussion. Tribes have acquired the status of sovereign nations within another nation. 39 L.. 141. 58 S. Co. 100.S. 890 [1946]. 167 [1946]. 99 L.. government is liable for payment of compensation. see also Tee Hit Ton Indians v. 661. 187 Id. vol. Co. 1216. Usually the recognition of Indian tribes depends on whether the tribe has a reservation. 350. 476 [1937].S. 55. 331. 260 [1941]. Ed. 104 [1997]. 198 Section 2. The Internationalization of Indigenous Rights from the Environmental and Human Rights Perspective. Ed. U. 224 U. at 499. 433.. at 293-294. 178 An allotment of Indian land contains restrictions on alienation of the land. Ancestral Domain Recognition in the Philippines: Trends in Jurisprudence and Legislation." implying that land beyond the right of way was privateKindred v. K. 330. 330. Ct. supra. 95 U. 40.J. L.S.S.S. at pp. supra. Ed. Note 28. Northern Pac. 3872 on June 18. reh den 348 U. 159 8 Wheat 543. 191 Director of Lands v. 3872. Ed. C. IPRA). at 680. Court of Appeals and Lapina. Part IV (c) (2).S. 216 SCRA 78 [1992]. R. 165 6 Pet 515. 173 Ibid. 195 Sec. 329 U. etc. 2[a]. 441 [1877]. at 501. p. 335. 235 SCRA 567 [1994]. Ct. Cl. 30 L. 521. 2 [b] [1979]. 437. 313 [1955]. 227 U. 35 S.A. This provision was added in 1964 by R.. certiorari granted U. 179 Aboriginal Title to Indian Lands.) . Indians.R. P. 235 U. 299 U. Ct. 141. 59 L. supra. 28 [1944 ed. 705. 177 41 Am Jr 2d. 201 SCRA 1. at 320. 189 Susi v. Ed. the proof of aboriginal title rests on actual. . 48 Phil. 965.S. 753.J. L. 1073 stating that these provisions on cultural minorities apply only to alienable and disposable lands of the public domain. and an uncompensated taking may be enjoined. 314. 435. p. Republic v. U. United States Denial of Indian Property Rights: A Study in Lawless Power and Racial Discrimination. 320. 91 L. 169 The title of the government to Indian lands. 483 [1832]. 183 Lynch.S. 440. 75 S. see also U. 56 L. 111. see also Tee Hit Ton Indians v. 176 Aboriginal Title to Indian Lands. the government having no landlord from whom it holds the fee." (Sec. Trapp. v. No. Rethinking Indian Law 15 (National Lawyers Guild. pp.S. by operation of customary law or inherited from their ancestors. 164 Lynch. Ed.Shoshone Tribe of Indians of Wind River Reservation in Wyoming v. C. 59 [1995 ed. 197 "Time immemorial" refers "to a period of time when as far back as memory can go. the Revised Forestry Code. 3 [p]. Director of Lands v. When an Indian property is taken for non-Indian use. 75 S. 1218-1219 [1938]. 681 [1823].S. Cohen.S. see also 42 C.S. 116. declared "public land. 6 [1914]. Northern Pac. at 500. Ed. see also 41 ALR Fed 425.S.Jose Paulo Kastrup. is a sovereign title. 29. Nat. Wetherby. Razon. 424 [1925]. 794. and Lane v. The State of Native America: Genocide.. Handbook of Federal Indian Law 217 [1982]. Wis. citing Shoshone Tribe v. (The Indian Claims Commission Act awards compensation to Indians whose aboriginal titles were extinguished by the government through military conquest. North American tribes have reached such an advanced stage that the main issues today evolve around complex jurisdictional and litigation matters. 320. 544.A. 186 D. supra. Sec. 355. 1090. 7 S. 1. 348 U. Ed. R. affirmed 58 S. Res. U. at 892. Gatmaytan. at 30 L.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 30 157 158 Ibid.. supra. 99 L. 204 Words in bold were amendments introduced by R. pp.J. Dar. 40 [Aug.. 772 [1974]. 141. 2[a]. possessed in the concept of owner. 199 Section 8. 37. 3[a]. Ariz. Co. citing Churchill. 2[b]. 303 U. Indians. 57 L.. 304 U. forced confinement of Indians and removal of Indians from certain portions of the land an the designation of Indian land into forest preserve. 203 Words in bold were amendments introduced by R. 194 Sec. 193 Id. 609. Beecher v. 43. 85 Ct. 162 Id.. CA and Paran. 182 North American Indians have made much progress in establishing a relationship with the national government and developing their own laws..S. Pueblo of Santa Rosa. A railroad land grant that falls within Indian land is null and void. Ct. U. Sec. 1964. Ct.A. 2d 73. 185 Ibid.R. Indians. at 99 L. Supreme Court have held that Congress is subject to the strictures of the Constitution in dealing with Indians. in accordance with their customs and traditions. 175 For compensation under the Indian Claims Commission Act.D. Ibid. 41 ALR Fed 425. Tee Hit Ton Indians v. at 696. however. stating that some earlier decisions of the U. 5 Phil. 160 Id..A. 192 75 Phil.S.S. Indigenous Peoples of Asia. 10-11 [1991]. at Sec. 167 Id. 48 [b]. 168 Id.S. Sec.. U. Article XII. County of Oneida. Ed. Ct. C. as amended. 171 Annotation. 196 Section 12. Union P. & T. C. 166 Id. 174 Oneida Indian Nation v.D. 414 U. Sec. 29 [1944 ed. at 689. Herico v. 48 [c].S. 180 42 C. These restrictions extend to a devise of the land by will.A. 141.S. 433. 2[a] [1979].. Portions of Indian land necessary for a railroad right of way were.A. 5 L.

Please see Tolentino. technology. 1997. 1315. viz: "Sec. L. Dakami Ya Nan Dagami. J. which are found to be necessary for critical watersheds. 11 Phil. 23 [Dec. Papers and Proceedings of the 1st Cordillera MutiSectoral Land Congress. 577 on the usufructuary of woodland. 7942." 210 Ibid. par. IPRA provides: "Sec. 473-474 [1987] citing the 1986 UP Law Constitution Project. Pagusara. 800-801 [1999]. J. The contractor provides the financing. I. 42 [1995].To preserve. 16 Phil. 3 [d] 'Small-scale mining contract' refers to co-production. managed and developed for such purposes. R.. 118. The ICCs/IPs concerned shall be given the responsibility to maintain. R. now Art. 11. 386. or reforestation as determined by appropriate agencies with the full participation of the ICCs/IPs concerned shall be maintained. 235 Hector S. Sy-Gonzales.Section 26 (b). and the government entitled to a share in the gross output. Principles and Cases. 11. Gray and Kingsbury. the organization of the Shari’a courts. The Indigenous Movement in Asia.Subject to Section 56 hereof. protect and conserve such areas with the full and effective assistance of government agencies. develop. 1. according to the rules of evidence. 629 [1908]. 223 Section 2.Section 26 (a). 239 [1988].To actively initiate. p. management and personnel necessary for the implementation of the agreement." Section 58 of the same law also mandates that ancestral domains or portions thereof. 217 Customary law is recognized by the Local Government Code of 1991 in solving disputes among members of the indigenous communities. 167 SCRA 736 [1988]. By Ass'n. "small-scale mining" refers to "mining activities which rely heavily on manual labor using simple implements and methods and do not use explosives or heavy mining equipment". People's Small-Scale Mining Act of 1991 (R. shall be presumed to be communally held: provided. see also Tolentino. Court of Appeals. . 208 Jus vindicandi. Jus abutendi. Nat. 227 Section 26. pp. 56." The law took effect 15 days upon publication in the O. forest cover. ponente. 36. 7076) provides: "Sec. the Philippine Mining Act of 1995. ed. P. Please see also La Vina. 160 SCRA 228. vol. The Kalinga Ili: Cultural-Ecological Reflections on Indigenous Theora and Praxis of Man-Nature Relationship. 84.A. That communal rights under this Act shall not be construed as co-ownership as provided in Republic Act No. Peters.. Phil. Art. it was declared that if a person is the owner of a piece of agricultural land on which minerals are discovered. 209 Sec. 220 Castle Bros. 26 for a list of other cases. undertake and participate in the reforestation of denuded areas and other development programs and projects subject to just and reasonable renumeration. pub. The IPRA was published in the Chronicle and Malaya on Nov. Series of 1998. 284 [1910]. (b) Restore Denuded Areas. Indigenous Peoples of Asia.Section 26 (c). public order or public policy shall not be countenanced. 207 Jus disponendi. etc. 1987 Constitution. whether delineated or not. Part II. Existing Property Rights Regimes.A. 222 Mariflor P. 226 A mineral "production-sharing agreement" is one where the government grants to the contractor the exclusive right to conduct mining operations within a contract area and shares in the gross output." 218 Law writes custom into contract-Hongkong & Shanghai Bank v. IPRA). Res. 211 Article 494. The National Economy and Patrimony. Art. 55. 1989]." "Art. 55. Article XII. the adjudication and settlement of disputes. pp.this is now Art. 1564 and 1577. Cordillera Consultative Committee [1984]. Civil Code. Civil Code.also cited in H. 1522. La Vina. 1214. By Barnes." 219 Article 78 on marriages between Mohammedans or pagans who live in the non-Christian provinces. II. 45-46 [1992]. 2 Phil.G. R. Please see Aquino. R. restore. R. Customs which are contrary to law. 216 Section 5. 7942. Communal rights. 25. Arguments for Communal Title. 1083 governs persons.. 7076.A. Cruz. 233 Section 7 (b) is subject to Section 56 of the same law which provides: "Sec. 33 of the Family Code. Arguments for Communal Title. Article XII. joint venture or mineral production sharing agreement between the State and a small-scale mining contractor for the small-scale utilization of a plot of mineral land. 7942. Yao Kee v. watershed areas. vol. protected areas. otherwise known as the New Civil Code. 238 Andrew Gray. wilderness. The Civil Code provides: "Art.Section 3 [b]. Grounds to Issue Writ of Prohibition... 678.To observe and comply with the provisions of this Act and the rules and regulations for its effective implementation. 221 This situation is analogous to the Muslim code or the Code of Muslim Personal Laws (P. 1083) which took effect on February 4. Part II." 229 Section 3 [b]. Civil Code. 237 See infra. Arts. (c) Observe Laws. p. 1.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 31 205 206 Jus utendi. 7942.D. wildlife sanctuaries. 2. 225 A "joint venture agreement" is one where a joint-venture company is organized by the government and the contractor with both parties having equity shares. Art. 212 Antonio M. for Asian Studies. 657 on easement of right of way for passage of livestock. responsibilities over their ancestral domains: (a) Maintain Ecological Balance. Petition.The customs and traditions of indigenous cultural communities shall be applied in settling disputes between members of the cultural communities. 12. 214 Sections 60-72. vol. pp. Civil Code. 228 Section 3 [d]. 14. 231 In Republic v. 236 Under the Small-Scale Mining Act of 1991. 2.. In Re: Firm Name of Ozaeta Romulo. shall be recognized and respected.A. 230 NCIP Administrative Order No. mangroves. 11-14 March 1983. 1.A. 412 (c) Conciliation among members of indigenous cultural communities. A custom must be proved as a fact. 1977 despite the effectivity of the Civil Code and the Family Code. jus fruendi. 92 SCRA 1 [1979]. family relations and succession among Muslims. de Leon. Gutierrez Hermanos. or in any 2 newspapers of general circulation (Sec. v. Please see Aquino. 234 Section 9 of the IPRA also gives the ICCs/IPs the ff. and other reserves. p.Property rights within the ancestral domains already existing and/or vested upon effectivity of this Act. vol. Textbook on the New Philippine Constitution pp. and maintain a balanced ecology in the ancestral domain by protecting the flora and fauna. 77-79?.A. 7076. p. 224 A "co-production agreement" is defined as one wherein the government provides input to the mining operation other than the mineral resource. areas within the ancestral domains. 74 of the Family Code on property relations between spouses.A. 1376. 7. Constitutional Law.. vol.D. p. 232 See Ground I. 215 Section 117. de Leon. at 23. pp. 213 Section 11. Corporation Code. his ownership of such land does not give him the right to extract or utilize the said minerals without the permission of the State to which such minerals belong. R. Corporation Code. at 35. supra. Corporation Code.

Marcus Colchester. 1996. The Internationalization of Indigenous Rights from the Environmental and Human Rights Perspective. 1728. 251 Perfecto V. World Council of IPs. 391. Manila Studies Association. Gray. citing the International Work Group for Indigenous Affairs. 1988. Due to the Kalingas' opposition." 249 See Introduction to ILO Convention No. 6 [1997]. and the Phil. 245 Section 22. No. 55 P. 3 [1999].L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 32 239 240 E. 248 Also referred to as the "Indigenous and Tribal Peoples Convention. 8371..A.Asia Dep't. 244 Kingsbury.J. 247 Guide to R. p. The Indigenous Movement in Asia. par. 243 The World Bank supported the Chico Dam project. 4. 246 Interpellation of Senator Flavier on S. Fernandez.. supra. 1989. November 20. 92: 414. 429 [1998]. 383. vol. 241 Jose Paulo Kastrup. Article II. Tan. Indigenous Peoples' Rights and Sustainable Resource Use in South and Southeast Asia. and the ILO-Bilance.B.g. Coalition for IPs Rights and Ancestral Domains. at 417. supra. 250 Id. 20. 385 [1980]. at 385. Inc. 5 and 6. Indigenous Peoples of Asia. National Historical Society. 252 Samuel K. Deliberation on Second Reading. International Indian Treaty Council. the International Labor Organization. "Indigenous Peoples" in International Law: A Constructivist Approach to the Asian Controversy. Towards a Definition of National Policy on Recognition of Ethnic Law within the Philippine Legal Order. the WB pulled out of the project but the conflict between the Philippine government and the natives endured long after. supra. supra.L. 71-72. A History of the Philippines. at 44. . 169. 59. pars. 102 [1997]. 253 Fernandez. The American Journal of International Law. p. 1987 Constitution. 242 Benedict Kingsbury. Inc. 32 Texas International Law Journal 97. pp. p.

1157. the actual sale and award thereof to Aniano David were not clandestine but open and public official acts of an officer of the Government. As noted in the decision under review.. Jr." On such finding of facts. The application was merely a renewal of his deceased 4 wife's application.. there is no justification for reversal. Bereft as petitioners were of the right of . a fatal defect of parties to this action. G. unexpressed but implied. but until it is raised by the government and set aside. up to the actual issuance of the sales patent in his favor. they must perforce rely on a legal theory. Consequently. SECRETARY OF AGRICULTURE AND NATURAL RESOURCES.. covering Lot 2892 containing an area of 226 square meters. 1972 PEDRO LEE HONG HOK." The above citation was 8 repeated ipsissimis verbis inSalazar v. As was there categorically stated: "The fact that the grant was made by the government is undisputed. since the filing of the sales application of Aniano David and during all the proceedings in connection with said application. now a member of this Court: "There is. It is a restatement of a principle that dates back to Maninang v.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 33 G. ANIANO DAVID. the defendant can not question it. because everything was done in the open. Durian. can bring an action to cancel a void certificate of title issued pursuant to a void patent (Lucas vs. as set forth at the outset. V-9033. Consolacion. In this case we do not see any fraud committed by defendantappellant Aniano David in applying for the purchase of the land involved through his Miscellaneous Sales Application No. According to the Stipulation of Facts. as to its holding that authoritative doctrines preclude a party other than the government to dispute the validity of a grant and the recognition of the indefeasible character of a public land patent after one year.. ROSITA LEE HONG HOK and LEONCIO LEE HONG HOK. Director of Lands vs. 102 Phil. is possessed of merit. respondents. he "acquired lawful title thereby pursuant to his miscellaneous sales application in accordance with which an order of award and for issuance of a sales patent was made by the Director of Lands on June 18. 1. furthermore. Whether the grant was in conformity with the law or not is a question which the government may raise. This was not done by said officers but by private parties like the plaintiffs. The 7 legality of the grant is a question between the grantee and the government. This is fatal to them because after the registration and issuance of the certificate and duplicate certificate of title based on a public land patent. and the said deceased occupied the land since 1938.. We affirm. namely by reclamation. a 1908 decision. A grant by 3 the government through the appropriate public officials exercising the competence duly vested in them by law is not to be set at naught on the premise. Without such underpinning. In this case the land in question is not a private property as the Director of Lands and the Secretary of Agriculture and Natural Resources have always sustained the public character thereof for having been formed by reclamation. which is a portion of Lot 2863 of the Naga Cadastre. entered in the records of the Bureau of Lands [Miscellaneous Sales] Entry No. The notices regarding the auction sale of the land were published. The first error assigned predicated an accretion having taken place.. would seek to disregard what was accepted by respondent Court as to how the disputed lot came into being.:p Petitioners in this appeal by certiorari would have us reverse a decision of respondent Court of Appeals 2 affirming a lower court judgment dismissing their complaint to have the Torrens Title of respondent Aniano David declared null and void. What makes the task for petitioners quite difficult is that their factual support for their pretension to ownership of such disputed lot through accretion was rejected by respondent Court of Appeals. 1959. the attempt of petitioners to elicit a different conclusion is likely to be attended with frustration. THE HON. represented by the Director of Lands.R. L-12485. 1959.. Neither of the other two errors imputed to respondent Court. No. Office of the Solicitor General for other respondents. Miscellaneous Sales Patent No.petitioners. Pardalis for petitioners." Petitioner ought to have known better. the plaintiffs-appellants did not put up any opposition or adverse claim thereto. SIMEON LEE HONG HOK. Only the Government. to put it mildly. available to the appellants is an action for reconveyance on the ground of fraud. July 31. V-1209 pursuant to which OCT No. is distinguished by unorthodoxy and is therefore far from persuasive. notwithstanding its rejection by respondent Court of Appeals. the shaft of criticism was let loose by petitioner aimed at this legal proposition set forth in the exhaustive opinion of then Justice Salvador Esguerra of the Court of Appeals. FERNANDO.. 1958. who cannot claim that the patent and title issued for the land involved are void since they are not the registered owners thereof nor had they been declared as owners in the cadastral proceedings of Naga Cadastre after claiming it as their private property. The above excerpt is 6 invulnerable to attack. On the basis of the order of award of the Director of Lands the Undersecretary of Agriculture and Natural Resources issued on August 26. The decision of respondent Court of Appeals following that of the lower court makes clear that there is no legal justification for nullifying the right of respondent Aniano David to the disputed lot arising from the grant made in his favor by respondent officials. Augusto A. Such an assumption is at war with settled principles of constitutional law. Luis General. Under Section 38 of Act 496 any question concerning the validity of the certificate of title based on fraud should be raised within one year from the date of the issuance of the patent.. or the Secretary of Agriculture and Natural Resources. J. which. More specifically. MSA-V-26747. THE DIRECTOR OF LANDS and COURT OF APPEALS. Heirs of Ciriaco Carlo. The only remedy therefore. 510 was issued by the Register of Deeds of Naga City to defendant-appellee Aniano David on October 21. It cannot receive our assent. The cases cited by appellants are not in point as they refer to private registered lands or public lands over which vested rights have been acquired but notwithstanding such fact the Land Department subsequently 5 granted patents to public land applicants. L-30389 December 27. Thereafter the certificate of title based thereon becomes indefeasible. for respondent Aniano David. It does not therefore call for any further consideration. No. vs. that land not otherwise passing into private ownership may not be disposed of by the state. 1959).R. the land covered thereby automatically comes under the operation of Republic Act 1 496 subject to all the safeguards provided therein. Court of Appeals.

the decision of respondent Court of Appeals of January 31. but did note the 11 existence of res publicae as a corollary to dominium. 54-56. found in an opinion of Justice J." They 20 continue to possess that character until severed therefrom by state grant. 2. Justice Malcolm. Castro." It is indispensable then that there be a showing of a title from the state or any other mode of acquisition 25 recognized by law. JJ. What was held in Heirs of Datu Pendatun v. stated: "The proceedings under the Land Registration Law and under the provisions of Chapter VI of the Public Land Law are the same in that both are against the whole world. Under Section 38 of Act 496 any question concerning the validity of the certificate of title based on fraud should be raised within one year from the date of the issuance of 28 the patent.. except as limited by the Constitution. they railed to accord deference to controlling precedents. which was adopted by the present Constitution. "question the [title] legally issued. Makasiar. The latest case in point 32 is Cabacug v.. and for both the decree of registration 30 31 issued is conclusive and final. Lao.. and with reason. speaking for the Court. The most recent restatement of the doctrine.." To repeat. taking into consideration not only their present condition. it was found by the Court of Appeals that the disputed lot was the result of reclamation. There is this revealing excerpt appearing in that decision: "It is said." It is quite apparent. ways. Zaldivar. there 12 was a recognition by Justice Holmes in Cariño v... Murciano. 4 Decision Appendix A. and governors may seem necessary for public squares. and after distributing to the natives what may be necessary for tillage and pasturage. but in addition the person to whom it is granted has likewise in his favor the right to repurchase within a period of five 33 years. as in this case." As far as the Philippines was concerned.. confirming them in what they now have and giving them more if necessary. Insular Government. As there are overtones indicative of skepticism. a case of Philippine origin. pastures.. Makalintal. the property is and 27 remains part of the public domain. This is fatal to them because after the registration and issuance of the certificate and duplicate certificate of title based on a public land patent. Footnotes 1 Petitioners are Pedro Lee Hong Hok. One of the royal decrees cited was incorporated in the 16 Recopilacion de Leyes de las Indias in these words: "We having acquired full sovereignty over the Indies and all lands. Brief for the Petitioners.. all the rest of said lands may remain free and unencumbered for us to 17 dispose of as we may wish. still pertaining to the royal crown and patrimony. 342. either by purchase or by grant. concur." For it is well-settled "that no public land can be 24 acquired by private persons without any grant. Not only does a free patent have a force and effect of a Torrens Title. since the filing of the sales application of Aniano David and during all the proceedings in connection with said application. 5 Ibid. in order that after reserving before all what to us or to our viceroys audiences. The former comes under the heading of imperium and the latter of dominium. Director of 22 Lands finds application. in Aquino v. 1969 and its resolution of March 14. Simeon Lee Hong Hok. 23 the property must be held to be public domain. In such capacity. 6 12 Phil. Where. Thereafter the certificate of title based thereon becomes indefeasible .." The second assignment of error is thus disposed of. What was stated by Holmes served to confirm a much more extensive discussion of the matter in the leading 15 case of Valenton v. in the language of Reyes 9 10 v. decided in 1904.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 34 ownership in accordance with the findings of the Court of Appeals. Rosita Lee Hong Hok and Leoncio Lee Hong Hok. but also their future and their probable increase." Petitioners cannot reconcile themselves to the view that respondent David's title is impressed with the quality of indefeasibility. 349. or by us. express or implied.B. 510 of the Registry of Naga City. Teehankee Barredo. from the government. 56-57. it may provide for the exploitation and use of lands and other natural resources. that petitioners' stand is legally indefensible. Director of 29 Lands. and its capacity to own or acquire property. Dean Pound did speak of the confusion that existed during the medieval era between such two concepts." That was a manifestation of the concept of jura regalia. 7 Ibid. that "Spain in its earlier decrees embodied the universal feudal theory that all lands were held from the 13 14 Crown. its being correctly 21 categorized as public land is undeniable. 2 Original Certificate of Title No.. 3 The Secretary of Agriculture and Natural Resources and the Director of Lands were likewise named respondents. Insular Government" that "as to the unappropriated public 19 lands constituting the public domain the sole power of legislation is vested in Congress. the plaintiffs-appellants did not put up any opposition or adverse claim thereto. As far back as 1919. therefore.L. it is our will that all lands which are held without proper and true deeds of grant be restored to us according as they belong to us. having failed to establish his right or title over the northern portion of 18 Lot No. it is not inappropriate to pursue the matter further.J. ownership however being vested in the state as such rather than the head thereof. . the land covered thereby automatically comes under the operation of Republic Act 496 subject to all the safeguards provided therein . Rodriguez. or in our name. C. and commons in those places which are peopled." Such a view has been followed since then. that a holder of a land acquired under a free patent is more favorably situated than that of an owner of registered property. Concepcion. 26 Reyes. of the well-known distinction in public law between the government authority possessed by the state which is appropriately embraced in the concept of sovereignty. With costs against petitioners-appellants. both take the nature of judicial proceedings. and possessions not heretofore ceded away by our royal predecessors. up to the actual issuance of the sales patent in his favor. WHEREFORE. 463 involved in the present controversy. territories. The last error assigned would take issue with this portion of the opinion of Justice Esguerra: "According to the Stipulation of Facts. and there being no showing that the same has been acquired by any private person from the Government." It could therefore be affirmed in Montano v. Antonio and Esguerra. the second assignment of error is devoid of merit. they cannot. . In thus manifesting such an attitude. 1969 are affirmed. if not of outright rejection. 3. including their disposition. follows: "The applicant. Thus: "There being no evidence whatever that the property in question was ever acquired by the applicants or their ancestors either by composition title from the Spanish Government or by possessory information title or by any other means for the acquisition of public lands. The use of this term is appropriate with reference to lands held by the state in its proprietary character.

40 Phil. 456 (1950). 16 Law I. Manalo v. 542-543. L-29575. Dela Cruz v. 11 SCRA 628. 28 Phil. 38 Phil. Panimdim v. Government v. 1971. May 19. Republic of the Philippines v. Aldecoa & Co. 223 (1911). 1964. 776. 60 Phil. 14 Cf. 34 SCRA 585. Cabangis 53 Phil. 639. L-19731. Reyes v. 1970. 771 (1936). 1968. Reano. 30 Ibid. L-23769. 1966. Director of Lands. Aragon v. 28 Decision. Lukban. Reyes. 19 Ibid. L-15415. Book 4. 29 39 Phil. 27 Phil. Insular Government v. Cf. 10 (1919). 10 Ibid. 17 (1934). 108-109 (1959). Ankron v. 973. 3 Pound. Rodriguez. Government. Abacite. 600 (1934). Court of Appeals. Archbishop of Manila v. 969 (1934). 20 Cf. 245 (1914). Jurisprudence. April 29. 22 59 Phil. 1961. 288 (1955). Director of Lands. 15 3 Phil. 12 212 US 449 (1909). 1 SCRA 1076. Appendix A to Brief for Petitioners. Title 12. L-29792. April 26. Government of the Philippine Islands. April 30. 13 Ibid. 62 Phil. 858. 21 Cf. 23 Ibid. (1911). July 31. 33 Ibid. 24 Padilla v. 18 12 Phil. Insular Government. 572 (1909). Radin. 31 Cf. 25 Cf. 36 SCRA 92. Barroga. Olviga. Law Dictionary. 967. 634. L-17696. November 26. Director of Lands v. 17 SCRA 71. 603. 60 Phil. 19 Phil. El Hogar Filipino v. (1924). 96. 458. 54-55. 27 Ibid. 26 Director of Lands v. The Court of Appeals. 32 L-27036. Francisco v. 537. August 31. 537. 23 SCRA 357. 19 Phil. 579. 850 (1919).L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 35 8 87 Phil. 48 Phil. 1970. 112 (1929). .. Antonio v. 771 (1936). 9 62 Phil. 17 3 Phil. 505 (1914). 11 Cf. 505.

which. and the right to possess explosives. (PARRDS). J. TUSAN. the President shall consider the real contributions to the economic growth and general welfare of the country that will be realized. On April 9. KINAIYAHAN FOUNDATION. LEAN LOUEL A. represented by his father 2 ELPIDIO V.: The present petition for mandamus and prohibition assails the constitutionality of Republic Act No. PERIA. MARIA MILAGROS L. BUGOY. represented by her father MARIO JOSE B. DAVID E. ALDEN S. DAISY RECARSE. ROMANO. ROBERTO S. 7942 defines the modes of 9 mineral agreements for mining operations. JULIA REGINA CULAR. PHILIPPINE PART`NERSHIP FOR THE DEVELOPMENT OF HUMAN RESOURCES IN THE RURAL AREAS. INC. PAUL ANTONIO P. GUSANAN. represented by their father VIRGILIO CULAR. ROBERTO P. represented by his father UNDERO D. PERIA. No.. IMELDA M. JR. AMLOY..A. represented by her father RIO OLIMPIO A. large-scale mining. LAGARO. The government's share in the agreements is spelled out and allocated. F'LONG AGUSTIN M. LENY B. SHARMAINE R. represented by his parents JOSE VILLAMOR and ELIZABETH PUA-VILLAMOR. 7942. 1 SUSAN O.. LEAN D. 1995. 1987. (WMCP). SENTRO NG ALTERNATIBONG LINGAP PANLIGAL (SALIGAN). LOMINGGES D. however.. LABUAYAN. GANDON. WOMEN'S LEGAL BUREAU (WLB). SANTOS. assignment/transfer and withdrawal. Sultan Kudarat. 28 22 23 24 15 6 LA BUGAL-B'LAAN TRIBAL ASSOCIATION. LUMAYONG. ROMY M.A. petitioners. In entering into such proposals. otherwise known as the PHILIPPINE MINING ACT OF 1995. two 33 newspapers of general circulation. shall mean those proposals for contracts or agreements for mineral resources exploration. Aside from penalizing certain acts. DEMONTEVERDE. outlines the procedure for their filing and 10 11 12 13 approval. represented by his father DANNY M. NEQUINTO. (CADI). BENITA P. Davao del Sur and North Cotabato. DABIE. 1995. The law prescribes the qualifications of contractors and grants them certain rights. VIRGILIO CULAR. or on March 30. TALJA. MARVIC M.. 5 7942. DADING. and fixes their terms. ROSE LILIA S. the President may execute with the foreign proponent. represented by his father ANTONIO L. VITUG. then President Corazon C. quarry and other permits. MANGCAL. DADING. YAP. No. PONCIANO BENNAGEN. MAMPARAIR. and safety and environmental protection. the President entered into an FTAA with WMCP covering 99. (PHILDHRRA). 30 days following its publication on March 10. represented by her father ALFREDO M. PHILIPPINE KAISAHAN TUNGO SA KAUNLARAN NG 3 KANAYUNAN AT REPORMANG PANSAKAHAN (KAISAHAN). as well as the development and use of local scientific and technical resources that will be promoted by the proposed contract or agreement. MIKENY JONG B. NARVADEZ. QUINTOL A. SAL. ANA GININA R. for purpose of this Section.. Shortly before the effectivity of R.F. TAÑADA. represented by her mother LYDIA S. GREEN FORUM PHILIPPINES. Inc. INC. INC. BUGOY. CUNANAN. 1995 in Malaya and Manila Times. water and easement rights. JR. DIRECTOR. RAQIM L. EDUARDO AURELIO C.A. LAGARO. OND. GIAN CARLO CULAR. LUMAYONG. (GF-WV). CONSTANTINO.A. MARIO JOSE B. including 16 17 18 19 timber. revocation and termination of agreements and permits. GUSANAN. and utilization involving a committed capital investment in a 7 single mining unit project of at least Fifty Million Dollars in United States Currency (US $50. LEONEN. represented by its Chairman F'LONG MIGUEL M. incentives granted. LUMAYONG. the law likewise specifies grounds for 32 the cancellation. RAMOS. SIMEON H. along with the Implementing Rules and Regulations issued pursuant thereto. 279 authorizing the DENR Secretary to accept. 2004 Administrative Order 96-40. WIGBERTO E. 7942 took effect. SR. represented by his father MANUEL E. DABIE. consider and evaluate proposals from foreign-owned corporations or foreign investors for contracts or agreements involving either technical or financial assistance for large-scale exploration. TACUAYAN.000. and promotes the development of mining communities. 1995. upon appropriate recommendation of the Secretary. INC.000. CENTER FOR ALTERNATIVE DEVELOPMENT INITIATIVES. INC. SECRETARY. GREEN FORUM WESTERN VISAYAS. MARCELO L. represented by his father MIGUEL M. BENJIE L.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 36 G.00). DE VERA. MIGUEL.R. KAISAHAN TUNGO SA KAUNLARAN NG KANAYUNAN AT REPORMANG PANSAKAHAN (KAISAHAN). vs. taxes and fees are 29 30 31 imposed. Surface owners. On March 3. CUNANAN. HORACIO RAMOS. No. 4 EXECUTIVE SECRETARY. or concessionaires are forbidden from preventing holders of mining rights from entering private lands and 20 21 concession areas. 25 sale and processing of minerals. No. science and 26 27 mining technology. DECISION CARPIO-MORALES. AMPARO S. VIRGILIO CULAR. VILLAMOR. Until Congress shall determine otherwise. occupants. LEGAL RIGHTS AND NATURAL RESOURCES CENTER. No. DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES (DENR). ALDEMAR L.387 34 hectares of land in South Cotabato. LOLITA G.V. UPLAND DEVELOPMENT INSTITUTE (UDI). (LRC). ALAN P. RUBEN TORRES. minors JOLY L. 127882 January 27. 1995 by the Republic of the Philippines and WMC (Philippines). represented by his mother ANNALIZA A. MIGUEL. Similar provisions govern 14 financial or technical assistance agreements. respondents. VICTOR O. EMUY. VERZOLA. represented by his father TOTING A. BOLANIO. RENE T. a corporation organized under Philippine laws. represented by his mother EDITHA T. JAIME TADEO. MARIO L. ENVIRONMETAL LEGAL ASSISTANCE CENTER (ELAC). R. SAN JOSE.) No. EDWARD M. 8 development. Ramos approved R. MINES AND GEOSCIENCES BUREAU (MGB-DENR). ROSERIO MARALAG LINGATING. Department of Environment and Natural Resources (DENR) . utilization and processing of all mineral resources. LAWAY. TALJA. The Act restricts the conditions for exploration. It regulates the transport. ROGER M. and WMC (PHILIPPINES). TALJA. A procedure for the settlement of conflicts is likewise provided for. development. JR. On July 25.O. 7942 to "govern the exploration. Aquino issued Executive Order (E. PARTNERSHIP FOR AGRARIAN REFORM and RURAL DEVELOPMENT SERVICES. SAL. ANTONIO JOSE A. NARVADEZ. INC." R. LINGATING. RENATO R. INC. REYES. DOLOJO. and of the Financial and Technical Assistance Agreement (FTAA) entered into on March 30. then President Fidel V. VITUG III. development. and utilization of minerals.

the then Executive Secretary. covering an area of 8. 1995. They allege that at the time of the filing of the petition. paragraph 2 of Article XII of the Constitution. VII .L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 37 On August 15. counsels for petitioners sent a letter to the DENR Secretary demanding that the 35 DENR stop the implementation of R. 7942. VI x x x in signing and promulgating DENR Administrative Order No. 96-40. Article XII of the Constitution. On January 10. Ramos issued DENR Administrative Order (DAO) No." x x x in recommending approval of and implementing the Financial and Technical Assistance Agreement between the President of the Republic of the Philippines and Western Mining Corporation Philippines Inc. Director of the Mines and Geosciences Bureau of the DENR. II x x x in signing and promulgating DENR Administrative Order No. 7942 and DAO No. III x x x in signing and promulgating DENR Administrative Order No. 96-40 implementing Republic Act No. 96-40 implementing Republic Act No. "it is a 100% owned subsidiary of WMC LIMITED. 7942 as unconstitutional and null and void. No." By WMCP's information. Petitioners claim that the DENR Secretary acted without or in excess of jurisdiction: I x x x in signing and promulgating DENR Administrative Order No. 96-40 implementing Republic Act No. 7942.] [Article XII] of the Constitution. with a prayer for a temporary restraining order. the latter being unconstitutional in that it allows priority to foreign and fully foreign owned corporations in the exploration. 1996 which was adopted on December 20. 1997. 1995. the then DENR Secretary. "a wholly owned subsidiary of Western Mining Corporation Holdings Limited. (b) Declaring the Philippine Mining Act of 1995 or Republic Act No. V x x x in signing and promulgating DENR Administrative Order No. Victor O.A. paragraph 1. paragraph 4. a publicly listed major Australian mining and 42 43 exploration company. as unconstitutional. the latter being unconstitutional in that it allows the taking of private property without the determination of public use and for just compensation. which entered into the assailed FTAA with the Philippine Government. Impleaded as public respondents are Ruben Torres. WMCP is owned by WMC Resources International Pty. 95-23. illegal and null and void. and Horacio Ramos. This was later repealed by DAO No. giving the DENR fifteen days from 36 37 receipt to act thereon. 7942.A. No. the latter being unconstitutional in that it allows the inequitable sharing of wealth contrary to Sections [sic] 1.. (c) Declaring the Implementing Rules and Regulations of the Philippine Mining Act contained in DENR Administrative Order No. then DENR Secretary Victor O. IV x x x in signing and promulgating DENR Administrative Order No. 7942. 7942. Ramos. 96-40. develop. paragraph 4[. Art. and at least one by a fully foreign-owned 39 mining company over offshore areas. the latter being unconstitutional in that it allows fully foreign owned corporations to explore. the latter being unconstitutional in that it violates Sec. They pray that the Court issue an order: (a) Permanently enjoining respondents from acting on any application for Financial or Technical Assistance Agreements. 40 because the same is illegal and unconstitutional.8 million hectares. 1. 96-40 implementing Republic Act No. development and utilization of mineral resources contrary to Article XII of the Constitution. 1996. 7942. 96-40 and all other similar administrative issuances as unconstitutional and null and void. III of the Constitution.4 million hectares. has yet to respond or act on petitioners' letter. Inc. however. utilize and exploit mineral resources in a manner contrary to Section 2. The DENR. 96-40 implementing Republic Act No. 100 FTAA applications had 38 already been filed. and (d) Cancelling the Financial and Technical Assistance Agreement issued to Western Mining 41 Philippines. s. 64 of which applications are by fully foreignowned corporations covering a total of 5. Also impleaded is private respondent WMCP. s. 96-40 implementing Republic Act No. Petitioners thus filed the present petition for prohibition and mandamus. and Section 2. 7942. Ltd. (WMC). otherwise known as the Implementing Rules and Regulations of R. the latter being unconstitutional in that it allows enjoyment by foreign citizens as well as fully foreign owned corporations of the nation's marine wealth contrary to Section 2.

not the possible consequences of its invalidation. are all 54 Filipino-owned corporations. 279 by virtue of which order the questioned FTAA was forged. WMCP subsequently filed a Manifestation dated September 25. 2002 decision of the Office of the President. not conjectural or anticipatory. The validity of the transfer remains in dispute and awaits final judicial determination. by Order of December 18. it involving the validity of the FTAA. alleging more than a generalized grievance. that such transfer cures the FTAA's alleged unconstitutionality. (2) A personal and substantial interest of the party raising the constitutional question. "Legal standing" or locus standi has been defined as a personal and substantial interest in the case such that the party has sustained or will sustain direct injury as a result of the governmental act that is being 64 65 challenged. "WMCP has ceased to be connected 47 in any way with WMC. (Lepanto) to the Office of the President which upheld it by 49 Decision of July 23. It further claims that by such sale and transfer of shares. Article VIII of the Constitution states that "(j)udicial power includes the duty of the courts of justice to settle actual controversies involving rights which are legally demandable and enforceable. the discussion shall dwell only insofar as it questions the effectivity of E. No. however. is limited to the determination of actual cases and controversies. aside from meeting petitioners' contentions. this Court granted due course to the petition. An actual case or controversy means an existing case or controversy that is appropriate or ripe for 60 determination." WMCP claims that at least 60% of the equity of Sagittarius is owned by Filipinos and/or Filipino-owned corporations while about 40% is owned by Indophil Resources NL. Inc. 2002 alleging that on January 23. The gist of the question of standing is whether a party alleges "such personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court depends for illumination of 58 . I Before going into the substantive issues. an Australian 46 company. only the first and the last need be delved into. (Sagittarius). Incidentally.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 38 Respondents. WMCP was subsequently renamed "Tampakan Mineral Resources 45 Corporation. lest the decision of the court would amount to an 61 62 advisory opinion. the DENR Secretary. Said Order. Tampakan Mining Corporation. Additionally. Its motion for reconsideration having been denied by the Office of the 50 51 President by Resolution of November 12. are hardly significant in the resolution of this case. These circumstances. This assumes. therefore. It bears stressing that this case has not been rendered moot either by the transfer and registration of the FTAA to a Filipino-owned corporation or by the non-issuance of a temporary restraining order or a 53 preliminary injunction to stay the above-said July 23. The power does not extend to hypothetical questions since any attempt at abstraction could only lead to dialectics and barren legal questions and to sterile conclusions unrelated to 63 actualities. (3) The exercise of judicial review is pleaded at the earliest opportunity. each of which was a holder of an approved Mineral Production Sharing Agreement awarded in 1994. The parties have since filed their respective memoranda. of course. Lepanto filed a petition for review before the Court of Appeals. WMCP also points out that the original claimowners of the major mineralized areas included in the WMCP FTAA. 2001. in the latter. albeit their respective mineral claims were subsumed in the WMCP 55 FTAA. 2002. Sagittarius. respondent WMCP argues that there has been a violation of the rule on hierarchy of courts. namely. the MPSAs of the three corporations would be revived and the mineral claims would 57 revert to their original claimants. as will be shown later. 48 Of the above-enumerated seven grounds cited by petitioners. on which question judgment is reserved. while informative. a corporation organized under 44 Philippine laws. and that these three companies are the same companies that consolidated their interests in 56 Sagittarius to whom WMC sold its 100% equity in WMCP. argue that the requisites for judicial inquiry have not been met and that the petition does not comply with the criteria for prohibition and mandamus. WMC sold all its shares in WMCP to Sagittarius Mines. two other petitions for review related to the approval of the transfer and 52 registration of the FTAA to Sagittarius were recently resolved by this Court. O. this Court can exercise its power of judicial review only if the following requisites are present: (1) The existence of an actual and appropriate case. 2002. was appealed by Lepanto Consolidated Mining Co." The 59 power of judicial review. and Southcot Mining Corporation. 2001. WMCP concludes that in the event that the FTAA is invalidated." By virtue of such sale and transfer. After petitioners filed their reply. REQUISITES FOR JUDICIAL REVIEW When an issue of constitutionality is raised. Section 1. the procedural questions posed by respondents shall first be tackled. Respondents claim that the first three requisites are not present. approved the transfer and registration of the subject FTAA from WMCP to Sagittarius. and (4) The constitutional question is the lis mota of the case.

As the case involves constitutional questions. which they submit is unconstitutional. petitioners also have standing to assail the validity of E.O. That such leases. by authority of which the FTAA was executed. As there is no suggestion that WMCP has indicated its intention not to avail of the provisions of Chapter XVI of R. It is undisputed that R. as well as other 69 residents of areas also affected by the mining activities of WMCP. it can safely be presumed that they apply to the WMCP FTAA. 186. They thus meet the appropriate case requirement as they assert an interest adverse to that of respondents who. 369 U. not raised at the earliest opportunity. 96-40 contain provisions that are more favorable to WMCP. taxpayers or voters who actually sue in the public interest. but by concerned citizens. the question as to their validity is ripe for adjudication. "It is important to note . Public respondents maintain that petitioners. As held in Kilosbayan v. 7942 and DAO No. Although all three requirements are directed towards ensuring that only certain parties can maintain an action. Carr. as well as broader policy concerns relating to the proper role of the judiciary in certain areas. – x x x That the provisions of Chapter XIV on government share in mineral production-sharing agreement and of Chapter XVI on incentives of this Act shall immediately govern and apply to a mining lessee or contractor unless the mining lessee or contractor indicates his intention to the secretary.Ed. is very different from questions relating to whether a particular plaintiff is the real party in interest or has capacity to sue. . No. a farmers and indigenous people's cooperative organized under Philippine laws representing a community 68 actually affected by the mining activities of WMCP. Inc.A. not to avail of said provisions x x x Provided. this Court is not concerned with whether petitioners are real parties in interest. Hence.3 Future Legislation Any term and condition more favourable to Financial &Technical Assistance Agreement contractors resulting from repeal or amendment of any existing law or regulation or from the enactment of a law. govern the FTAA. 96-40 likewise fulfills the requisites of justiciability. he has no standing. . 72 but with whether they have legal standing. would lapse into constitutionality by the mere failure of the proper party to promptly file a case to challenge the same. hence. The WMCP FTAA provides: 14. CIVIL PROCEDURE 328 [1985]) Standing is a special concern in constitutional law because in some cases suits are brought not by parties who have been personally injured by the operation of a law or by official action taken.2d 633 [1962]. these laws. on the other hand. members of said cooperative. Petitioners allege that public respondents acted without or in excess of jurisdiction in implementing the FTAA. Petitioners traverse a wide range of sectors. In other words. that standing because of its constitutional and public policy underpinnings.["] (FRIEDENTHAL. Although these laws were not in force when the subject FTAA was entered into. KANE AND MILLER. SEC. standing restrictions require a partial consideration of the merits. hence. they contend that petitioners are not real parties in interest in an action for the annulment of contract. The challenge against the constitutionality of R. 112. 7942 and DAO No. No.A. PROPRIETY OF PROHIBITION AND MANDAMUS . Public respondents' contention fails. No.A." (Baker v. The present action is not merely one for annulment of contract but for prohibition and mandamus. 7942. Among them are La Bugal B'laan Tribal Association. Non-impairment of Existing Mining/Quarrying Rights. Morato: x x x. the question in standing is whether such parties have "alleged such a personal stake in the outcome of the controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for illumination of difficult constitutional questions. The third requisite should not be taken to mean that the question of constitutionality must be raised immediately after the execution of the state action complained of. They 70 claim that they would suffer "irremediable displacement" as a result of the implementation of the FTAA allowing WMCP to conduct mining activities in their area of residence. regulation or administrative order shall be considered a part of this Agreement.S.. financial or technical assistance agreements shall comply with the applicable provisions of this Act and its implementing rules and regulations. 7 L. otherwise unconstitutional. No. That the question of constitutionality 73 has not been raised before is not a valid reason for refusing to allow it to be raised later. A contrary rule would mean that a law. In view of the alleged impending injury. 279. No.A. in writing.) 66 As earlier stated. production-sharing agreements. In addition. 7942 explicitly makes certain provisions apply to pre-existing agreements. R. Misconstruing the application of the third requisite for judicial review – that the exercise of the review is pleaded at the earliest opportunity – WMCP points out that the petition was filed only almost two years after the execution of the FTAA. being strangers to the FTAA. cannot sue either or both 71 contracting parties to annul it. insist on the FTAA's validity. These petitioners have standing to raise the constitutionality of the questioned FTAA as they allege a personal and substantial injury. finally." Unless a person is injuriously affected in any of his constitutional 67 rights by the operation of statute or ordinance.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 39 difficult constitutional questions. petitioners meet this requirement. to the extent that they are favorable to WMCP.

The resort to this Court's primary jurisdiction to issue said writs shall be allowed only where the redress desired cannot be obtained in the appropriate courts or where exceptional and compelling circumstances justify such invocation. Cuaresma that: A becoming regard for judicial hierarchy most certainly indicates that petitions for the issuance of extraordinary writs against first level ("inferior") courts should be filed with the Regional Trial Court. development. The rule has been explained thus: Between two courts of concurrent original jurisdiction. Petition for prohibition. wildlife. if not the national economy.] The repercussions of the issues in this case on the Philippine mining industry. While the execution of the contract itself may be fait accompli. 279 did not take effect because its supposed date of effectivity came after President Aquino had already lost her legislative powers under the Provisional Constitution. constitute exceptional and compelling circumstances to justify resort to this Court in the first instance. Petitioners seek to prevent them from fulfilling such obligations on the theory that the contract is unconstitutional and. all other natural resources shall not be alienated. as well as the novelty thereof. and And they likewise claim that the WMC FTAA. is in order. such concurrence does not give a party unrestricted freedom of choice of court forum. corporation. and to prevent further over-crowding of the Court's docket x x 76 x. That way. and there is no appeal or any other plain. coal. which are the proper subject of attention of the appellate court. Article XII of the Constitution because. flora and fauna. minerals. among other reasons: (1) It allows foreign-owned companies to extend more than mere financial or technical assistance to the State in the exploitation. or with grave abuse of discretion. this Court may brush aside technicalities of 78 procedure. Section 2 of Rule 65 read: SEC. II Petitioners contend that E. waters. We held in People v. petroleum. and even permits foreign owned companies to "operate and manage mining activities.O. habeas corpus and injunction. all forces of potential energy. prohibition. the concepts contained therein. In all events.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 40 Before the effectivity in July 1997 of the Revised Rules of Civil Procedure. this Court has the discretion to take cognizance of a suit which does not satisfy the 77 requirements of an actual case or legal standing when paramount public interest is involved. The exploration. and other natural resources are owned by the State. it is the lower court that should initially pass upon the issues of a case. Section 2. Although this Court has concurrent jurisdiction with the Regional Trial Courts and the Court of Appeals to issue writs of certiorari. discussion of the propriety of the mandamus aspect of the petition is rendered unnecessary. quo warranto. This Court has consistently enjoined litigants to respect the hierarchy of courts. and the laws enacted pursuant thereto. 2. and other mineral oils." (2) It allows foreign-owned companies to extend both technical and financial assistance. . a visit to the history of the pertinent constitutional provision. a person aggrieved thereby may file a verified petition in the proper court alleging the facts with certainty and praying that judgment be rendered commanding the defendant to desist from further proceeding in the action or matter specified therein. 279. No. HIERARCHY OF COURTS The contention that the filing of this petition violated the rule on hierarchy of courts does not likewise lie. or person. forests or timber. [Emphasis supplied. void. mandamus. clearly and specifically set out in the petition. instead of "either technical or financial assistance. With the exception of agricultural lands. No. This is established policy. as a particular case goes through the hierarchy of courts. and utilization of natural resources shall be under the full 74 those against the latter. with the Court of Appeals. It seeks a judgment ordering the defendant to desist from continuing 75 with the commission of an act perceived to be illegal. All lands of the public domain. When the issues raised are of paramount importance to the public. The propriety of a petition for prohibition being upheld. speedy.O. development. are without or in excess of its or his jurisdiction. therefore. and adequate remedy in the ordinary course of law. It is a policy necessary to prevent inordinate demands upon the Court's time and attention which are better devoted to those matters within its exclusive jurisdiction. whether exercising functions judicial or ministerial. board. which was entered into pursuant to E. petroleum. it is shorn of all but the important legal issues or those of first impression. Public respondents. and other mineral oils. have obligations to fulfill under said contract. – When the proceedings of any tribunal. in behalf of the Government. Prohibition is a preventive remedy. fisheries. A direct invocation of the Supreme Court's original jurisdiction to issue these writs should be allowed only where there are special and important reasons therefor. Article XII reads in full: Sec. 2. This is a procedural rule borne of experience and adopted to improve the administration of justice. its implementation is not. The petition for prohibition at bar is thus an appropriate remedy. and utilization of minerals. violates Section 2." To appreciate the import of these issues.

or production-sharing agreements with Filipino citizens. and to 88 grant patents to private mineral lands. recognized the unique value of natural resources. or corporation who or which has entered and is occupying such lands shall have paid to the Government of said Islands such additional sum or sums as will make the total amount paid for the mineral claim or claims in which said deposits are located equal to the amount charged by the Government for the same as mineral claims. the King was regarded as the original proprietor of all lands. petroleum. or corporations or associations at least sixty per centum of whose capital is owned by such citizens. and this exclusive right of possession and enjoyment continues during the entire life of the location. Thus. or those rights which the King has by virtue of his prerogatives. In such agreements. Among the principal organic acts of the Philippines was the Act of Congress of July 1. lakes. THE AMERICAN OCCUPATION AND THE CONCESSION REGIME By the Treaty of Paris of December 10. and while the use of lands was granted out to others who were permitted to hold them under certain conditions. 1902. with priority to subsistence fishermen and fish-workers in rivers. and lagoons. and the land in which they are found. association. These were rights enjoyed during feudal times by the king as the sovereign. renewable for not more than twenty-five years. earlier Spanish decrees 82 declared that "all lands were held from the Crown. occupation and purchase of mineral deposits not only to citizens of the Philippine Islands but to those of the United States as well: Sec. joint venture. territorial sea. the State shall promote the development and use of local scientific and technical resources. and reserve its use and enjoyment exclusively to Filipino citizens. in particular. x x x. mineral deposits have been found. beneficial use may be the measure and limit of the grant. and utilization of minerals. the working of such mineral deposits is forbidden until the person. In Spanish law. it refers to a right which the sovereign has over anything in which a subject has a right of property or propriedad. Section 20 of said Bill reserved the disposition of mineral lands of the public domain from sale. 1898. That when on any lands in said Islands entered and occupied as agricultural lands under the provisions of this Act. allow small-scale utilization of natural resources by Filipino citizens. by law." The Regalian doctrine extends not only to land but also to "all natural wealth that may be found in the 83 bowels of the earth. occupation and purchase. has the effect of a grant by the United States of the present and exclusive possession of the lands located. and other mineral oils according to the general terms and conditions provided by law. both surveyed and unsurveyed. 81 . The President may enter into agreements with foreign-owned corporations involving either technical or financial assistance for large-scale exploration. from 89 90 exploiting minerals within his property. Spain ceded "the archipelago known as the Philippine Islands" to the United States. and from him all lands were held.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 41 control and supervision of the State. The Philippines was hence governed by means of organic acts that were in 86 the nature of charters serving as a Constitution of the occupied territory from 1900 to 1935. development. the King theoretically retained the title. the term "jura regalia" refers to royal rights. earlier jurisprudence held that: A valid and subsisting location of mineral land. water supply. Such agreements may be for a period not exceeding twenty-five years. and under such terms and conditions as may be provided by law. Unlike Spain. A person who acquired ownership over a parcel of private mineral land pursuant to the laws then prevailing could exclude other persons. Mining laws during the Spanish regime reflected this perspective. as well as cooperative fish farming. through which the United States Congress assumed the administration of the 87 Philippine Islands. The State shall protect the nation's marine wealth in its archipelagic waters. The President shall notify the Congress of every contract entered into in accordance with this provision. Introduced by Spain into these Islands. and exclusive economic zone. the United States considered natural resources as a source of wealth for its nationals and saw fit to allow both Filipino and American citizens to explore and exploit minerals in public lands. or industrial uses other than the development of water power. based on real contributions to the economic growth and general welfare of the country. which is the capacity of the 79 State to own or acquire property. but not patented. viewing them. The Philippines having passed to Spain by virtue of discovery and conquest. as an abundant source of revenue to finance its wars against other 84 85 nations. The State may directly undertake such activities or it may enter into co-production. That all valuable mineral deposits in public lands in the Philippine Islands. even the State. fisheries. bays. especially minerals. 21. Section 21 thereof allowed the free and open exploration. In cases of water rights for irrigation. In its broad sense." Spain. to occupation and purchase. more commonly known as the Philippine Bill of 1902. and the true and only source of title. within thirty days from its execution. by citizens of the United States or of said Islands: Provided. The theory of the feudal system was that title to all lands was originally held by the King. this feudal concept is based on the State's power of dominium. The theory of jura regalia 80 was therefore nothing more than a natural fruit of conquest. made and kept up in accordance with the provisions of the statutes of the United States. x x x. are hereby declared to be free and open to exploration. THE SPANISH REGIME AND THE REGALIAN DOCTRINE The first sentence of Section 2 embodies the Regalian doctrine or jura regalia. By fiction of law. The Congress may.

the President of the United States certified that the Constitution conformed substantially with the provisions of the Act 105 of Congress approved on March 24. and their disposition. 2932. approved on May 14. concession. (2) to serve as an instrument of national defense. [Italics in the original. but also against the Government. On March 23. Act No. and no license. in which cases beneficial use may be the measure and the limit of the grant. on Conservation and Utilization of Natural Resources. water supply. or concession at the time of the inauguration of the Government established under this Constitution. therefore. State ownership of natural resources was seen as a necessary starting point to secure recognition of the state's power to control their disposition. timber. etc.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 42 The discovery of minerals in the ground by one who has a valid mineral location perfects his claim and his location not only against third persons. This was the traditional regime imposed by the colonial administrators for the 94 exploitation of natural resources in the extractive sector (petroleum. development. subject to any existing right. 1934. For with the establishment of the principle of state ownership of the natural resources. The 1935 Constitution adopted the Regalian doctrine. petroleum. The same Section 1. Section 1. Thus. 1935. On July 30. development or utilization. Under the concession system. coal. Article XIII. 1920. the concessionaire makes a direct equity investment for the purpose of 95 exploiting a particular natural resource within a given area. x x x. helping prevent the extension to the country of foreign control through peaceful economic penetration. To remove all doubts. 107 including mineral lands and minerals. except as to water rights for irrigation. waters. Later statutory enactments by the legislative bodies set up in the Philippines adopted the contractual 98 99 framework of the concession. grant. development. or to corporations or associations at least sixty per centum of the capital of which is owned by such citizens. the Convention approved the provision in the Constitution affirming the Regalian doctrine. expressly permitting the State to grant licenses. development. or industrial uses other than the development of water power. mineral rights are included in a grant of land by the government. minerals. 2719. 1917. The Constitution was 104 submitted to the President of the United States on March 18. declaring all natural resources of the Philippines. all forces of potential energy. however. lease. 1934. The adoption of the principle of state ownership of the natural resources and of the Regalian doctrine was considered to be a necessary starting point for the plan of nationalizing and conserving the natural resources of the country. differ in one essential respect. One delegate relates: 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. 1935. the Constitution was ratified by the Filipino 106 people. Under the Regalian theory. The nationalization of the natural resources was intended (1) to insure their conservation for Filipino posterity. The nationalization and conservation of the natural resources of the country was one of the fixed and 109 dominating objectives of the 1935 Constitutional Convention.). or utilization of any of the natural resources shall be granted for a period exceeding twenty-five years. All agricultural. the concessionaire either pays rent or royalty. fisheries. location. exploitation. popularly known as the Tydings-McDuffie Law. Article XIII also adopted the concession system. THE 1935 CONSTITUTION AND THE NATIONALIZATION OF NATURAL RESOURCES By the Act of United States Congress of March 24. which provided for the leasing and 101 development of coal lands in the Philippines. or utilization shall be limited to citizens of the Philippines. 1934. timber. for it is given exclusive and plenary 96 rights to exploit a particular resource at the point of extraction. 1935. under the American 91 doctrine. For instance. and other mineral oils. Section 21 also made possible the concession (frequently styled "permit". or leases for the exploitation. In consideration for the right to exploit a natural resource. exploitation. the concession amounts to complete control by the concessionaire over the country's natural resource. and mineral lands of the public domain.] The Regalian doctrine and the American system. exploitation. hard minerals. or utilization of any of the natural . to be property belonging to the State. Natural resources. of the 1935 Constitution provided: SECTION 1. 1935. the Constitutional Convention met for the purpose of drafting a constitution. mineral rights are not included in a grant of land by the state. and lease of lands containing petroleum and other mineral oils and 100 gas in the Philippines. it would not be hard to secure the recognition of the power of the State to control their 110 disposition. with the exception of public agricultural land. the medieval concept of jura regalia is stripped of royal overtones and ownership of the land is 108 vested in the State. 102 the People of the Philippine Islands were authorized to adopt a constitution. development. shall not be alienated. both utilized the concession system. and Act No. As adopted in a republican system. and other natural resources of the Philippines belong to the State. license" or 92 93 "lease") system. or lease for the exploitation. and the Constitution 103 subsequently drafted was approved by the Convention on February 8. On May 14. which provided for the exploration. or utilization. concessions. and (3) to avoid making the Philippines a 111 source of international conflicts with the consequent danger to its internal security and independence. they were not certain whether it was continued and applied by the Americans. The delegates of the Constitutional Convention very well knew that the concept of State ownership of land and natural resources was introduced by the Spaniards. which is a fixed percentage of the gross 97 proceeds. approved on August 31.

development. The Amendment extended. of the foregoing Constitution. The 140 Administration Unit was charged. citizens of the Philippines or corporations or associations owned or controlled by citizens of the Philippines. coals. and other natural resources of the Philippines. shall. Failure to pay the annual exploitation tax for two consecutive years.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 43 resources. Article Thirteen. and under the same conditions imposed upon. also known as 114 the Laurel-Langley Agreement. title warranty. with the enforcement of the provisions of the law. This proceeded from the theory that all natural deposits or occurrences of petroleum or natural gas in public and/or private 121 lands in the Philippines belong to the State. minerals. who acted under the Secretary's immediate supervision and control. Concessions were granted at the complete risk of the concessionaire. waters. The Secretary of Agriculture and Natural Resources was tasked with carrying out the provisions of the law. Upon termination of such concession. less that 130 consumed in the operations of the concessionaire. technical competence. 387. which respectively granted to the concessionaire the exclusive right to explore for or 117 develop petroleum within specified areas. Article Fourteen. as well as 125 126 127 production reports. they did grant concessionaires the right to explore. 137 through the Director of Mines. 1949. the 136 concessionaire had a right to remove the same. No. exploit. were limited to Filipinos or entities at least 60% of the capital of which is owned by Filipinos.lavvphi1. embodied in Republic Act No. 1946 to July 3. directly or indirectly. Under Article 66. and skills necessary to conduct the operations to be undertaken. the disposition. nineteen hundred and fortysix. all forces and sources of potential energy. and mineral lands of the public domain. however. Exploration and exploitation concessionaires were also required to submit work programs. These concessionaires were also bound to pay the Government royalty. and the operation of public utilities. develop. The Parity Amendment was subsequently modified by the 1954 Revised Trade Agreement. Republic Act No. 1355. which was not less than 12½% of the petroleum produced and saved. nineteen hundred and seventy-four. the Government did not guarantee 124 the existence of petroleum or undertake. but in no case to extend beyond the third of July. 131 it would not actually be paying the exploitation tax. which came in the form of an "Ordinance Appended to the Constitution. title rights to all equipment and structures that the concessionaire placed on the land belong to 135 the exploration or exploitation concessionaire. June 18. among other functions. inter alia. and not simply to sit on the 129 concession without developing or exploiting it. the right to utilize and exploit our natural resources to citizens of the United States and business enterprises owned 113 or controlled. during the effectivity of the Executive Agreement entered into by the President of the Philippines with the President of the United States on the fourth of July. the object of which is to induce the concessionaire to actually produce petroleum. a surcharge of 1% per month is exacted until the same are paid. Concessionaires were required to submit information as maybe required by the Secretary of Agriculture and Natural Resources.A. R. and section eight. by citizens of the United States in the same manner as to. in particular. Among the kinds of concessions it sanctioned were exploration and exploitation 116 concessions. timber. or the royalty due to the 133 Government within one year from the date it becomes due." 112 was ratified in a plebiscite. be open to citizens of the United States and to all forms of business enterprise owned or controlled. and utilization of all agricultural. In case of delay in the payment of the taxes or royalty imposed by the law or by the 134 concession. pursuant to the provisions of Commonwealth Act Numbered Seven hundred and thirty-three. the Parity Amendment. including reports of geological and geophysical examinations. 119 resources.ne+ The swell of nationalism that suffused the 1935 Constitution was radically diluted when on November 1946. organization. constituted grounds for the cancellation of the concession. the exploitation tax may be credited against the royalties so that if the concessionaire shall be actually producing enough oil. THE PETROLEUM ACT OF 1949 AND THE CONCESSION SYSTEM In the meantime. 387. and utilize them for the period and under 123 the conditions determined by the law. 1974. As a rule. were obliged to pay an annual exploitation tax. The Act granted the Secretary the authority to inspect any operation of the concessionaire and to examine all the books and accounts pertaining to operations or conditions related to payment of taxes and 138 royalties. petroleum. by citizens of the United States: Notwithstanding the provision of section one. exploitation. The Technical Board had.lawph!l. the duty to check on the performance of concessionaires and to determine whether the obligations imposed by the Act and its implementing regulations were 141 being complied with.net Exploitation concessionaires. in any case. 139 132 128 122 also known as the Petroleum Act of 1949. Concessions may be granted only to duly qualified persons who have sufficient finances. was approved on The Petroleum Act of 1949 employed the concession system for the exploitation of the nation's petroleum resources. The same law authorized the Secretary to create an Administration Unit and a Technical Board. directly or indirectly. Grants. Nevertheless. 115 upon the concessionaire ownership over the petroleum lands and petroleum deposits. if open to any person. from July 4. Exploration and exploitation concessions did not confer 120 118 . and other mineral oils. However. the Government reserved the right to undertake such work itself.

P." "Service contracts" is a term that assumes varying meanings to different people. investing as it does ownership of natural resources. or directly manages the productive enterprise. In a service contract under P. even if nominally. high risk venture could be successfully undertaken by a single individual or a small company. Dimagiba. analyzed the benefits and drawbacks of the concession system insofar as it applied to the petroleum industry: Advantages of Concession. the contractor may furnish services. Once petroleum in commercial quantity is discovered. 87. A functional definition of "service contracts" in the Philippines is provided as follows: A service contract is a contractual arrangement for engaging in the exploitation and development of petroleum. 151 145 . since the concession system practically closed its doors to interested foreign investors. marketing. and assumes all exploration risks such that if no petroleum is produced.D. this establishes only an indirect and passive control of the host country in resource development. 1972 of Presidential Decree No. and "participation agreements" in Latin 147 America. The contractor provides all necessary services and technology and the requisite financing. first. operations of the exploration and exploitation of 148 the resources or the disposition of marketing or resources. a direct role in management is usually necessary in order to obtain a knowledge of the international petroleum industry which is important to an appreciation of the host country's resources in relation to those of other 142 countries. undertakes the exploitation or production of a given resource. the most positive aspect of the concession system is that the State's financial involvement is virtually risk free and administration is simple and comparatively low in cost. in that the latter provides financial or technical resources. and more importantly. manage and execute petroleum operations. even though most concession agreements contain covenants requiring diligence in operations and production. exclusive responsibility for downstream operations. Second. revenue accruing to the State under the concession system may compare favorably with other financial arrangements. "concession agreements" in Africa. if there is a competitive allocation of the resource leading to substantial bonuses and/or greater royalty coupled with a relatively high level of taxation. This is true for several reasons. otherwise known as The Oil Exploration and Development Act of 1972 signaled such a transformation. In short. Chief Legal Officer of the Bureau of Energy Development. like "work contracts" in Indonesia. constitutes a consistent inconsistency with the principle embodied in our Constitution that natural resources belong to the state and shall not be alienated. The concession system. land and other natural resources by which a government or its agency. Other liabilities of the system have also been noted: x x x there are functional implications which give the concessionaire great economic power arising from its exclusive equity holding. and the proceeds of sale of the petroleum produced under the contract shall be the source of funds for payment of the service fee and the operating expenses due the 152 contractor. which would be 144 available only to multinational companies. Financing is supposed to be provided by the Government to which all petroleum produced belongs. third. The contractor shall undertake. performs the exploration work obligations. energy. No. the concession system failed for reasons explained by Dimagiba: Notwithstanding the good intentions of the Petroleum Act of 1949. Eventually. Because the Government's role in the traditional concession is passive. and distribution. the contractor shall operate the 155 field on behalf of the government. major negative aspects to this system. like processing. it will not be entitled to 154 reimbursement. second. 87. subject to the 153 government overseeing the management of the operations. Disadvantages of Concession. subject to a modest royalty. 87. the state is the sovereign and owner of the natural resource being exploited. local capital was stretched to the limits. "production-sharing agreements" in the Middle East. Moreover.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 44 Victorio Mario A. First. expansion. Whether it emphasizes income tax or royalty. control of production of the natural resource. or a private person granted a right or privilege by the government authorizes the other party (service contractor) to engage or participate in the exercise of such right or the enjoyment of the privilege. Furthermore. research and development.D. Lastly. however. since it assumed that such a capitalintensive. the fact that the host country does not directly participate in resource management decisions inhibits its ability to train and employ its nationals in petroleum development. No. it has been shorn of all elements of control over such natural resource because of the exclusive nature of the contractual regime of the concession. This factor could delay or prevent the country from effectively engaging in the development of its resources. it is at a distinct disadvantage in managing and developing policy for the nation's petroleum resource. A shift to a new regime for the development of natural resources thus seemed imminent. The old system also failed to consider the highly sophisticated technology and expertise required. This includes. 87 permitted the 146 government to explore for and produce indigenous petroleum through "service contracts. appropriation of the returns of the undertaking. and fourth. exclusive management of the project. such as volume of production. THE 1973 CONSTITUTION AND THE SERVICE CONTRACT SYSTEM The promulgation on December 31. PRESIDENTIAL DECREE NO. concessionaires' funds were easily exhausted. service and technology are furnished by the service contractor for 149 which it shall be entitled to the stipulated service fee. mineral. not to mention the fact that the concession was 143 the bedrock of the colonial system in the exploitation of natural resources. There are. In effect. and it has carried many names in different countries. the concession system could not have properly spurred sustained oil exploration activities in the country. In case the Government is unable to finance petroleum exploration operations. The contractor must be technically competent 150 and financially capable to undertake the operations required in the contract. technology and financing.

Presidential Decree No. management. technical. natural resources shall not be alienated. management. [Emphasis supplied. Section 44 of the decree. exploitation. was intended to "enhance the proper development of our natural resources since Filipino citizens lack the needed capital and technical know-how which are essential in the proper exploration. may allow such citizens. lessees. 1974. On March 13. 87 prescribed minimum terms and conditions for every service contract. virtually the entire range of the country's natural resources –from petroleum and minerals to geothermal energy. though. marketing and 171 processing of fish and fishery/aquatic products. minerals. 8. none of the laws allowing service contracts were passed by the Batasang Pambansa. THE 1987 CONSTITUTION AND TECHNICAL OR FINANCIAL ASSISTANCE AGREEMENTS 172 170 169 . The disposition. development and exploitation of the natural resources of the 163 country. and no license. including exemption from taxes and payment of tariff duties. in which cases beneficial use may be the measure and the limit of the grant. The prior approval of the National Assembly was 166 deemed sufficient to protect the national interest. . The Batasang Pambansa. as amended. management or other forms of assistance with any foreign persons or entity for the 168 exploration. the President promulgated 167 Presidential Decree No.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 45 P. exploration. Section 1 thereof authorized the Government to enter into service contracts for the exploration. all forces of potential energy. upon authority of the Batasang Pambansa. Presidential Decree No. according to one delegate. or utilization of any of the natural resources shall be granted for a period exceeding twenty-five years. allowed Filipinos engaged in commercial fishing to enter into contracts for financial. Notably. approved on May 16. Section 8. was basically a concession regime with a production-sharing element. Article XIV on the National Economy and Patrimony contained provisions similar to the 1935 Constitution with regard to Filipino participation in the nation's natural resources. approved on May 19. to enter into service contracts 164 with foreign entities. Presidential Decree No. in the national interest. 151. waters. in the Philippines. provided that a lessee of a mining claim may enter into a service contract with a qualified domestic or foreign contractor for the exploration. or other forms of assistance with any person or entity for the exploration. corporation or entity for the production. fisheries. except as to water rights for irrigation. or other forms of assistance . or to corporations or associations at least sixty per centum of which is owned by such citizens. technical. wildlife. residential and resettlement lands of the public domain. All lands of the public domain. With the exception of agricultural. On January 17. not private entities. It has been opined. 463. The provision allowing such contracts. and other natural resources of the Philippines belong to the State. development. or other forms of assistance are hereby recognized as such. development. technical. the service contract system had certain advantages over the concession regime." Yet another law allowing service contracts. all of them were enacted by presidential decree. 1442. or lease for the exploration. 705 (The Revised Forestry Code of the Philippines). development.D. then President Ferdinand E.] The concept of service contracts." 159 156 The original idea was to authorize the government. 704 (The Fisheries Decree of 1975). however. also known as The Mineral Resources Development Decree of 1974. concession. exploitation or utilization of said lands. exploitation. industrial or commercial. our concept of a service contract. was Presidential Decree 174 No. or utilization of any of the natural resources of the Philippines shall be limited to citizens. coal. It also granted the 157 contractor certain privileges. exploitation and development of geothermal resources with a foreign contractor who must be technically and financially capable of undertaking the operations required in the service contract. shortly after the ratification of the new Constitution. this time for geothermal resources. from public lands and forest resources to fishery products – was well covered by apparent legal authority to engage in the direct participation or involvement of foreign persons or corporations (otherwise disqualified) in the exploration and utilization of natural resources through 175 service contracts. with any foreign person or entity for the 173 exploration. 1973. corporations or associations to enter into service contracts for financial. exploitation or utilization of the forest resources. 1973. No. While Section 9 of the same Article maintained the Filipino-only policy in the enjoyment of natural resources. Sec. storage. it also allowed Filipinos. was enacted on May 17. according to another. . petroleum and other mineral oils. Existing valid and binding service contracts for financial. was borrowed from the methods followed by 162 India. technical. renewable for not more than twenty-five years. 1975. Ostensibly. development. 1978. management. at least in the petroleum 160 industry. Pakistan and especially Indonesia in the exploration of petroleum and mineral oils. or industrial uses other than the development of water power. a citizen or private entity could be allowed by the 165 National Assembly to enter into such service contract. or utilization of any of the natural resources. Thus. development and exploitation of his claims and the processing and marketing of the product thereof. allowed "forest products licensees. which was signed into law on June 11. and 158 permitted the repatriation of capital and retention of profits abroad. or permitees to enter into service contracts for financial. Marcos proclaimed the ratification of a new 161 Constitution. 1975. Article XIV thereof provides: Sec. that. The law allowed Filipino citizens or entities which have acquired lands of the public domain or which own. to enter into service contracts with any person or entity for the exploration or utilization of natural resources. 9. water supply. technical or other forms of assistance with any foreign person. fisheries. Indeed. As finally approved. hold or control such lands to enter into service contracts for financial.

Section 2 offers the State 182 two "options. Only the President. by law. Fifth. The Congress may. Under this provision. development and utilization of natural resources. joint venture. to corporations or associations at least 60% of the capital of which is owned by Filipinos. wildlife. the State may directly undertake these activities itself. as well as the recognition of the importance of the country's natural resources. except agricultural lands.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 46 After the February 1986 Edsa Revolution. not only for national 178 economic development. waters. or production-sharing agreements with Filipino citizens." The constitutional policy of the State's "full control and supervision" over natural resources proceeds from the concept of jura regalia. the President created a Constitutional Commission (CONCOM) to 177 draft a new constitution. as well as cooperative fish farming. petroleum. Article XII states: "All lands of the public domain. Conspicuously absent in Section 2 is the provision in the 1935 and 1973 Constitutions authorizing the State to grant licenses. Although Section 2 sanctions the participation of foreign-owned corporations in the exploration. The agreements must be based on real contributions to economic growth and general welfare of the country. in the case of the former. and utilization of minerals. and other mineral oils according to the general terms and conditions provided by law. While the second and third options are limited only to Filipino citizens or. or two. and utilization of natural resources. development. and other natural resources are owned by the State. forests or timber. On March 25. or entities at least 60% of whose capital is owned by such citizens. petroleum and other mineral oils. Corazon C. The agreements must be in accordance with the terms and conditions provided by law. concession or lease" is no longer allowed under the 1987 Constitution. development. the 1987 Constitution. the utilization of inalienable lands of public domain through 180 "license. A third option is found in the third paragraph of the same section: Sixth." Third. but also for its security and national defense. in the second sentence of the same provision. a Filipino citizen. more popularly referred to as the Freedom Constitution. joint venture. exploitation. or utilization of natural resources. Having omitted the provision on the concession system. First. development. flora and fauna." Like the 1935 and 1973 Constitutions before it. under the 1973 Constitution. and lagoons. The President shall notify the Congress of every contract entered into in accordance with this provision. lakes." One. allow small-scale utilization of natural resources by Filipino citizens. Section 2 proceeded to introduce "unfamiliar 181 language": The State may directly undertake such activities or it may enter into co-production. The fourth and fifth paragraphs of Section 2 provide: The President may enter into agreements with foreign-owned corporations involving either technical or financial assistance for large-scale exploration. 176 3. development. it may enter into coproduction. the State 179 assumes "a more dynamic role" in the exploration. petroleum. the natural resources subject of the activities is restricted to minerals. 1987. The first sentence of Section 2." Second. or production-sharing agreements with Filipino citizens. based on real contributions to the economic growth and general welfare of the country. or corporations or associations at least sixty per centum of whose capital is owned by such citizens. consistency with the provisions of statute. concessions. the size of the activities: only large-scale exploration. and utilization is 183 allowed. may enter into these agreements. all forces of potential energy. In such agreements. fisheries. in behalf of the State. By authority of the same Proclamation. The term "large-scale usually refers to very capital-intensive activities. 1986. President Aquino issued Proclamation No. it imposes certain limitations or conditions to agreements with such corporations. minerals. and only with corporations. The third sentence of the same paragraph is new: "The exploration. prohibits the alienation of natural resources. corporation or association may enter into a service contract with a "foreign person or entity. or leases for the exploration. with priority to subsistence fishermen and fish-workers in rivers. and other mineral oils. Consonant with the State's "full supervision and control" over natural resources. the intent being to limit service contracts to those areas where Filipino capital 184 may not be sufficient. coal. the parties to FTAAs. the agreements must contain rudimentary stipulations for the promotion of the development and use of local scientific and technical resources. Fourth. a fourth allows the participation of foreign-owned corporations. The 1987 Constitution retained the Regalian doctrine. promulgating the Provisional Constitution. Aquino took the reins of power under a revolutionary government. development and utilization of natural resources shall be under the full control and supervision of the State. By contrast. bays. within thirty days from its execution. By such omission. . the State shall promote the development and use of local scientific and technical resources. Section 2 prescribes certain standards for entering into such agreements. which took effect on the date of its ratification on February 2.

joint venture or production-sharing agreements with Filipino citizens or qualified corporations. The Government's share in a CA or JVA is set out in Section 81 of the law: The share of the Government in co-production and joint venture agreements shall be negotiated by the Government and the contractor taking into consideration the: (a) capital investment of the project. A "qualified person" is any citizen of the Philippines with capacity to contract. 279 by authority of which the subject WMCP FTAA was executed on March 30. (c) contribution of the project to the economy. and utilization of natural resources. as amended. and a passing mention of government-owned or controlled corporations. . Finally. utilization.A. and their implementing rules and regulations. 7942 does not actually cover all the modes through which the State may undertake the exploration. management. amending Section 151(a) of the National Internal Revenue Code. 191 No. it may undertake these activities through four modes: The State may directly undertake such activities.O. the President issued E. No. still referred to them in Section 2 thereof: Sec. the said E. (2) The State may enter into co-production. 463. the notification requirement. . or cooperative organized or authorized for the purpose of engaging in mining. The President shall notify Congress of every financial or technical assistance agreement entered into within thirty days from its execution. All mineral agreements grant the respective contractors the exclusive right to conduct mining operations 204 and to extract all mineral resources found in the contract area." Such declaration notwithstanding." The Government participates the least in a mineral production 192 sharing agreement (MPSA). R. . The omission in the 1987 Constitution of the term "service contracts" notwithstanding.O. (3) Congress may. 7942. In an MPSA. the contractor's income tax. special allowance. . development and utilization thereof. partnership.A. 7076 (the People's Small-Scale Mining Act of 1991) and other pertinent laws. The Government may enter into a CA or JVA with one or more contractors. including renewal applications and applications for approval of operating agreements and mining service contracts. No. Aside from earnings in equity. or a corporation. other existing mining laws. 1995. No.O. technology. development and utilization of minerals. 1987. development and utilization of mineral resources. 7942 primarily concerns itself with the second and fourth modes. association. signed into law E.A." As earlier stated. the Government in a JVA is also entitled to a share 201 202 203 in the gross output. No. Except to charge the Mines and Geosciences Bureau of the DENR with performing researches and 187 188 surveys. being the owner of the natural resources. the Government grants the contractor the exclusive right to 193 194 conduct mining operations within a contract area and shares in the gross output. No. 7942 as "mineral agreements. and shall consist. is accorded the primary power and responsibility in the exploration. As such. operating agreements and service contracts . shall be accepted and processed and may be approved x x x. as amended. 2. by law.A. on the 25th also of July 1987. Section 15 thereof declares that the Act "shall govern the exploration. excise tax. the President may enter into agreements with foreign-owned corporations involving 186 technical or financial assistance. . where the Government enjoys the greatest participation. R. the Government and the JVA contractor organize a company with both parties 200 having equity shares. [Emphasis supplied. evaluation and approval of all mining applications .] The same law provided in its Section 3 that the "processing. the scope of the agreements. with technical and financial 198 . and (d) other factors that will provide for a fair and equitable sharing between the Government and the contractor. Mineral production sharing. among other things. 7942 does not specify how the State should go about the first mode. on July 10. duties and fees as provided for under existing laws. 1995." It bears noting that the phrases "service contracts" and "management or other forms of assistance" in the earlier constitution have been omitted. The MPSA contractor provides the financing. in case of a foreign national and all such other taxes. The State. (b) the risks involved. In a co-production agreement (CA). withholding tax due from the contractor's foreign stockholders arising from dividend or interest payments to the said foreign stockholders. . The Government shall also be entitled to compensations for its other contributions which shall be agreed upon by the parties.A. or other forms of assistance" the 1987 Constitution provides for "agreements. while in a joint venture agreement (JVA).L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 47 Seventh. Applications for the exploration. development and utilization of minerals. shall be governed by Presidential Decree No. . 211 prescribing the interim procedures in the processing and approval of applications for the exploration. No. and processing of all mineral resources. By virtue of her legislative powers under the Provisional Constitution. While the 1973 Constitution referred to "service contracts for financial. development. R. co-production and joint venture agreements are collectively classified by R. 185 (4) For the large-scale exploration. allow small-scale utilization of natural resources by Filipino citizens. On March 3. petroleum and other mineral oils. A "qualified person" may enter into any 205 of the mineral agreements with the Government. The total government share in an MPSA is the excise tax on mineral products under 196 197 Republic Act No. President Ramos signed into law R. 7729. management and personnel necessary for the agreement's 195 implementation. the Government provides inputs to the mining operations other 199 than the mineral resource. President Aquino. is governed 189 190 by Republic Act No. . . The third mode. on the other hand. development. technical. involving either financial or technical assistance.

mandates the publication of statutes. supra. No.00). the principal distinction between mineral agreements and FTAAs is the maximum contract area to which a qualified person may hold or be 211 granted. an FTAA is subject to negotiation. two days before the opening 214 of Congress on July 27. Where a law provides for its own date of effectivity.O. save that in an FTAA: The collection of Government share in financial or technical assistance agreement shall commence after the financial or technical assistance agreement contractor has fully recovered its pre-operating expenses. which. 279 was actually published 220 in the Official Gazette on August 3. 279. according to petitioners. No.O.O.] 212 On that premise. as this Court held in Tañada v.O. states that the same "shall take effect immediately. 279. 200. Section 1 of E. this is the very essence of the phrase "unless it is otherwise provided" in Section 1 thereof.O. runs counter to Section 1 of E. No. therefore.O.A. not even a constructive one. No. Nevertheless. and what due process requires. is read into Section 8 of E. such date prevails over that prescribed by E. Respondents. "Large-scale" under R." Other than the difference in contractors' qualifications. and Tañada v.O.O. she was still validly exercising legislative powers 221 under the Provisional Constitution. 1987. as opposed to the amount invested (US $50. 279 Petitioners argue that E. 1987. it is not a ground for its invalidation since the Constitution. Factoran. 200. petitioners' contentions have no merit. Laws shall take effect after fifteen days following the completion of their publication either in the Official Gazette or in a newspaper of general circulation in the Philippines." 218 219 is deemed written in the law. No. a consideration of the substantive issues presented by the petition is now in order." An FTAA is defined as "a contract involving financial or technical assistance for large-scale exploration.O. 57 and 82 which were issued pursuant thereto.O.000. 200 that prevents a law from taking effect on a date other than – even before – the 15-day period after its publication. No. No. being "the fundamental. What is mandatory under E. That such effectivity took place after the convening of the first Congress is irrelevant. It bears noting that there is nothing in E. and utilization of natural resources in the Philippines 208 may enter into such agreement directly with the Government through the DENR.O. No. Section 8 of the E. and 207 utilization of natural resources. unless it is otherwise 216 provided." finds suppletory application. 200. 1987. It is significant to note that E. [Emphasis supplied. THE EFFECTIVITY OF EXECUTIVE ORDER NO." It would be the height of injustice to punish or otherwise burden a citizen for the transgression of a law of which he had no notice whatsoever. and development expenditures. 279 on July 25. III Having examined the history of the constitutional provision and statutes enacted pursuant thereto. E. development. E. Tuvera.O. did not come into effect. 200. Indeed. No.O. partnership. petitioners contend that E. association. on the other hand. This is of course incorrect for the issue in Miners Association was not the validity of E. development. 279 became effective immediately upon its publication in the Official Gazette on August 3.O. No. 1987. 279 could have only taken effect fifteen days after its publication at which time Congress had already convened and the President's power to legislate had ceased. From a reading then of Section 8 of E. Section 1 of E. counter that the validity of E." 215 This provision. so Tañada held. 279 but that of DAO Nos. 213 exploration. 279. Hence. No. which provides: SECTION 1." Any qualified person with technical and financial capability to undertake large-scale exploration. 7942 is determined by the size of the contract area.O. While the effectivity clause of E. The Government's contributions. is the publication of the law for without such notice and publication. 279 was signed into law by then President Aquino on July 25. No.O.O. a legally organized foreign-owned corporation (any corporation.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 48 capability to undertake mineral resources development and duly registered in accordance with law at 206 least sixty per centum (60%) of the capital of which is owned by citizens of the Philippines x x x. No. Section 1. No. applies only when a statute does not provide for its own date of effectivity. paramount and supreme law of the nation. At the time President Aquino issued E. Like a CA or a JVA. the due process clause. inclusive. which was the standard under E. No. For the purpose of granting an FTAA. No. 1987. in the form of taxes. in an FTAA is identical to its contributions in the two mineral agreements. the law in force when the WMC FTAA was executed.000.O. there would be no basis for the application of the maxim "ignorantia legis n[eminem] excusat. 279 does not require its publication. Article XVIII (Transitory Provisions) of the 1987 Constitution explicitly states: . No. 200 which provides for publication "either in the Official Gazette or in a newspaper of general circulation in the Philippines. this Court holds that E. No. 200. or cooperative duly registered in accordance with law in which less than 50% of the capital is 209 210 owned by Filipino citizens) is deemed a "qualified person. No. Additionally. 279 was settled in Miners Association of the Philippines v. The fourth mode involves "financial or technical assistance agreements. 217 Tuvera. 279.O.O.

the phrase "management or other forms of assistance" in the 1973 Constitution was deleted in the 1987 Constitution. GARCIA.O. They constitute a serious negation of Filipino control on the use and disposition of the nation's natural resources. VILLEGAS.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 49 Sec. TAN. TAN. Nolledo and Tadeo who alluded to service contracts as they explained their respective votes in the approval of the draft Article: MR. I vote no primarily because of two reasons: One." Casus omisus pro omisso habendus est. 279 encompasses a "broad number of possible services. to extend more than mere financial or technical assistance to the State." It thus posits that it may also well include "the area of management or operations .] WMCP also cites the following statements of Commissioners Gascon. even when they have been proven to be inimical to the interests of the nation. THE CONSTITUTIONALITY OF THE WMCP FTAA MR. I vote no. FTAAs should be limited to "technical or financial assistance" only. therefore. This intention is to be sought in the constitution itself. TAN." perhaps. that E. Mr.] xxx .'" And point out how members of the CONCOM referred to these agreements as "service contracts. was precisely the evil that the drafters of the 1987 Constitution sought to eradicate. minerals and mineral oils should be limited to "technical" or "financial" assistance only. the WMCP FTAA allows WMCP. for it permits WMCP to manage and 222 operate every aspect of the mining activity. ambiguity. development. x x x." They add that "[t]he concept is embodied in the phrase 'agreements involving financial or technical 229 assistance. Yes. They observe. [Emphasis supplied. Respondents insist that "agreements involving technical or financial assistance" is just another term for service contracts. They contend that the proceedings of the CONCOM indicate "that although the SR. Article XII of the Constitution. and the apparent meaning of the words is to be taken as expressing it. "scientific and/or technological in 226 basis. GASCON. There was no law at all governing service contracts before. contrary to the language of the Constitution. Presiding Officer. and utilization of petroleum. 6. which is the primary feature of service contracts.] x x x. The convening of the first Congress merely precluded the exercise of legislative powers by President Aquino. which allows only "technical or financial assistance. [Emphasis supplied. except in cases where that assumption would lead to absurdity. SR. Service contracts are given constitutional legitimization in Section 3. Thank you. . this should always be with the concurrence of Congress and not guided only by a 231 general law to be promulgated by Congress. compels acceptance and negates the power of the courts to alter it. in accordance with the text of Section 2. and a validly enacted. There can be no question. As will be shown later. As priorly pointed out. Marcos is the general law to be enacted by the legislature and the notification of Congress by the President? That is the only difference. x x x." For instance: SR. based on the postulate that the framers and 225 the people mean what they say. Madam President. Petitioners submit that. Accordingly. VILLEGAS. 230 terminology 'service contract' was avoided [by the Constitution]. so long as such assistance requires specialized knowledge or skills. No. Am I correct in thinking that the only difference between these future service contracts and the past service contracts under Mr." This Court is not persuaded. 232 especially with regard to those which are nonrenewable. Petitioners' submission is well-taken. object or thing omitted from an 228 enumeration must be held to have been omitted intentionally. assistance accorded by foreign-owned corporations in the large-scale exploration. it did not prevent the effectivity of laws she had previously enacted. No. is it not? [Emphasis supplied. or 224 contradiction. following the literal text of the Constitution. the concept it represented was not. Garcia. I felt that if we would constitutionalize any provision on service contracts. statute. a fully foreign-owned mining corporation. The incumbent President shall continue to exercise legislative powers until the first Congress is convened. development 227 and utilization of mineral resources. WMCP nevertheless submits that the word "technical" in the fourth paragraph of Section 2 of E. and are related to the exploration. however. providing as they do the legal loophole for the exploitation of our natural resources for the benefit of foreign interests. the provision on service contracts. therefore. that. So those are the safeguards[?] MR. Thank you. the management or operation of mining activities by foreign contractors. A person. It is a cardinal rule in the interpretation of constitutions that the 223 instrument must be so construed as to give effect to the intention of the people who adopted it.O. . What the Constitution says according to the text of the provision. 279 is an effective. MR. That is right.

] . MR. Pangalawa. A doubtful provision will be examined in light of the history of the times. x x x. [T]he Court in construing a Constitution should bear in mind the object sought to be accomplished by its adoption. is there a safeguard against the possible control of foreign interests if the Filipinos go into coproduction with them? MR. the service contract should not be an instrument to circumvent the basic provision. and the evils. and if foreign equity is permitted. While there are objectionable provisions in the Article on National Economy and Patrimony. I hope the forthcoming Congress will implement such provisions taking into account that Filipinos should have real control over our economy and patrimony. development and utilization of 237 natural resources. Kailan man ang Article on National Economy and Patrimony ay hindi nagpaalis sa pagkaalipin ng ating ekonomiya sa kamay ng mga dayuhan. naroroon pa rin ang parity rights. of course can be refined – is found in Section 3. [Emphasis supplied. QUESADA. Commissioner Villegas allayed the fears of Commissioner Quesada regarding the participation of foreign interests in Philippine natural resources. Yes. [Emphasis supplied. Ang solusyon sa suliranin ng bansa ay dalawa lamang: ang pagpapatupad ng tunay na reporma sa lupa at ang national industrialization. ang service contract. In other words. involving either technical or financial assistance").] In a subsequent discussion. TADEO. QUESADA. this was 233 under the 1973 Constitution. 234 Kailan man hindi puwedeng sumikat ang araw sa Kanluran. An examination of the reason behind the change confirms that technical or financial assistance agreements are not synonymous to service contracts. In fact. sought to be prevented or remedied. ay ipinipilit sa ating sambayanan na ang araw ay sisikat sa Kanluran. If. Matapos suriin ang kalagayan ng Pilipinas. where Congress will have to concur with the President on any agreement entered into between a foreign-owned corporation and the government involving technical or financial assistance for large-scale exploration. Nais ko lamang ipaliwanag ang aking boto. Ngunit ang mga landlords and big businessmen at ang mga komprador ay nagsasabi na ang free trade na ito. which was supposed to be restricted to Filipinos. and the condition and circumstances under which the Constitution was framed. pangunahin ang salitang "imperyalismo. .L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 50 MR. x x x. If the CONCOM intended to retain the concept of service contracts As the following question of Commissioner Quesada and Commissioner Villegas' answer shows the drafters intended to do away with service contracts which were used to circumvent the capitalization (60%-40%) requirement: MS. MS. Habang naghihirap ang sambayanang Pilipino. Ito ang tinatawag naming pagsikat ng araw sa Silangan. Such a difference between the language of a provision in a revised constitution and that of a 235 similar provision in the preceding constitution is viewed as indicative of a difference in purpose. I vote no. ang 60-40 equity sa natural resources. Thank you. lines 25 to 30. the deletion of the phrase "service contracts" was our first attempt to avoid some of the abuses in the past regime in the use of service contracts to go around the 6040 arrangement." In the 1973 Constitution. It is also my understanding that service contracts involving foreign corporations or entities are resorted to only when no Filipino enterprise or Filipino-controlled enterprise could possibly undertake the exploration or exploitation of our natural resources and that compensation under such contracts cannot and should not equal what should pertain to ownership of capital. the concept of "technical or financial assistance" agreements is identical to that of "service contracts. the phrase "service contracts" has been deleted in the 1987 Constitution's Article on National Economy and Patrimony. Sa pamamagitan ng salitang "based on. in order to construe the whole 236 as to make the words consonant to that reason and calculated to effect that purpose. . ang kahulugan para sa amin.] This Court is likewise not persuaded." In this particular Section 3. VILLEGAS. [Emphasis supplied." the CONCOM would not have bothered to fit the same dog with a new collar. The safeguard that has been introduced – and this. it could have simply adopted the old terminology ("service contracts") instead of employing new and unfamiliar terms ("agreements . as respondents suggest. ang saligang suliranin. NOLLEDO. The object is to ascertain the reason which induced the framers of the Constitution to enact the particular provision and the purpose sought to be accomplished thereby. that the exploration and exploitation of natural resources should be truly for the benefit of Filipinos. and I vote yes. if any. To uphold respondents' theory would reduce the first to a mere euphemism for the second and render the change in phraseology meaningless. As earlier noted. The 1973 Constitution used the words "service contracts." naroroon na ang free trade sapagkat tayo ay mananatiling tagapagluwas ng hilaw na sangkap at tagaangkat ng yaring produkto. the same must be subordinated to the imperative demands of the national interest. going over said provisions meticulously. setting aside prejudice and personalities will reveal that the article contains a balanced set of provisions. Another point of clarification is the phrase "and utilization of natural resources shall be under the full control and supervision of the State." Ang ibig sabihin nito ay ang sistema ng lipunang pinaghaharian ng iilang monopolyong kapitalista at ang salitang "imperyalismo" ay buhay na buhay sa National Economy and Patrimony na nating ginawa. ginagalugad naman ng mga dayuhan ang ating likas na yaman.

[Emphasis supplied. Going back to Section 3. It is only technical or financial assistance – they do not own anything – but on conditions that have to be determined by law with the concurrence of Congress. MR. It is not for them to enjoy our natural resources. QUESADA. Subject to the three-minute rule. If the Commissioner will remember. And so I appeal to all. joint venture. and we became victims of foreign dominance and control. Actually. for the sake of the future generations. development. DAVIDE. it is very restrictive. What I refer to is that foreign interest should be allowed to participate only to the extent that they lend us money and give us technical assistance with the appropriate government permit. Fifty years from now. x x x. I am not saying that we should not consider borrowing money from foreign sources. on the other hand. Mr. . I am raising this point for fear that foreign investors will use their enormous capital resources to facilitate the actual exploitation or exploration. VILLEGAS. suggest that in the large-scale exploration. capital-intensive. MAAMBONG. this removes the possibility for service contracts which we said 238 yesterday were avenues used in the previous regime to go around the 60-40 requirement. Such activities may be directly undertaken by the State. and enunciates strict conditions that should govern such contracts. but it was removed and substituted by "shall be under the full control and supervision of the State. exploit and develop our natural resources. that principle proceeds from the fact that our natural resources are gifts from God to the Filipino people and it would be a breach of that special blessing from God if we will allow aliens to exploit our natural resources. that if we have to pray in the Preamble "to preserve and develop the national patrimony for the sovereign Filipino people and for the generations to come. development and effective disposition of our natural resources to the detriment of Filipino investors. . As a matter of fact. the President with the concurrence of Congress may enter into agreements with foreign-owned corporations even for technical or financial assistance. Lines 25 to 30. the second provision about the President does not permit foreign investors to participate." we must at this time decide once and for all that our natural resources must be reserved only to Filipino citizens. So we are still limiting it only to Filipino citizens. x x x. if we will allow these aliens to exploit our natural resources. VILLEGAS. there will be no more natural resources for the next generations of Filipinos. we can insure the enjoyment of our natural resources by our own people. production-sharing agreements with Filipino citizens. MS. He writes: Paragraph 4 of Section 2 specifies large-scale.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 51 limited to citizens of the Philippines. . meaning. It will not take three minutes. and utilization of natural resources… may be directly undertaken by the State. So. if the Commissioner reads the next sentence. noncitizens would have access to these natural resources? Is that the understanding? MR." Was the concept changed so that these particular resources would be limited to citizens of the Philippines? Or would these resources only be under the full control and supervision of the State. Madam President. No alien must be allowed to enjoy. I voted in favor of the Jamir proposal because it is not really exploitation that we granted to the alien corporations but only for them to render financial or technical assistance. or it may enter into co-production. our population is increasing by leaps and bounds. Madam President. then a member of the CONCOM. or it may enter into co-production. It may last long if we will begin now. 239 The present Chief Justice. In the Preamble we clearly stated that the Filipino people are sovereign and that one of the objectives for the creation or establishment of a government is to conserve and develop the national patrimony. I wonder if this part of Section 3 contradicts the second part.] The Commission had just approved the Preamble. [Emphasis supplied. No. development and utilization of natural resources. joint venture or production-sharing agreement with . highly technological undertakings for which the President may enter into contracts with foreign-owned corporations. Since 1935 the aliens have been allowed to enjoy to a certain extent the exploitation of our natural resources. the section suggests that: The exploration. Thank you. also referred to this limitation in scope in proposing an amendment to the 60-40 requirement: MR. Vice-President.] 240 The opinion of another member of the CONCOM is persuasive and leaves no doubt as to the intention of the framers to eliminate service contracts altogether. In this way. May I be allowed to explain the proposal? MR. our natural resources are depleting. DAVIDE. corporations or associations at least sixty per cent of whose voting stock or controlling interest is owned by such citizens. The implication is that the national patrimony or our natural resources are exclusively reserved for the Filipino people. it states: MR. The aliens are interested in coming to the Philippines because they would like to enjoy the bounty of nature exclusively intended for Filipinos by God.

and (2) Financial Assistance for large-scale enterprises. All lands of the public domain. The President may enter into agreements with foreign-owned corporations involving either technical or financial assistance for large-scale exploration. fisheries. fisheries. The National Assembly may by law allow small scale utilization of natural resources by Filipino citizens. flora and fauna and other natural resources of the Philippines are owned by the State. renewable for not more than twenty-five years. as well as other provisions on foreign investments. minerals.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 52 This provision balances the need for foreign capital and technology with the need to maintain the national sovereignty.P. petroleum and other mineral oils. bays. all forces of potential energy. The National Assembly. With the exception of agricultural lands. [Emphasis supplied. development. all forces of potential energy. renewable for not more than twenty-five years and under such terms and conditions as may be provided by law. flora and fauna. beneficial use may be the measure and limit of the grant. development. and utilization of natural resources shall be under the full control and supervision of the State. 1. The intent of this provision. The exploration. joint venture. . development and utilization of natural resources shall be under the full control and supervision of the State. The State shall protect the nation's marine wealth in its archipelagic waters. as the comparative table below shows: 242 production. and other natural resources are owned by the State. petroleum and other mineral oils. All lands of the public domain. The Congress may. and reserve its use and enjoyment exclusively to Filipino citizens. all other natural resources shall not be alienated. forests. Are service contracts allowed under the new Constitution? No. 496 OF THE CONSTITUTIONAL COMMISSION ARTICLE XII OF CONSTITUTION THE 1987 Sec. water supply. involving either technical or financial assistance" contained in the "Draft of the 1986 U. The State may directly undertake such activities or it may enter into co-production. development. with priority to subsistence fishermen and fish-workers in rivers. beneficial use may be the measure and limit of the grant. fisheries. coal. and utilization of natural resources shall be under the full control and supervision of the State. foreign investors (fully alien-owned) can NOT participate in Filipino enterprises except to provide: (1) Technical Assistance for highly technical enterprises. beneficial use may be the measure and limit of the grant. territorial sea. wildlife. and under such terms and conditions as may be provided by law. In case as to water rights for irrigation. coal. Under the new Constitution.] Furthermore. which was the draft Article on National Economy and Patrimony. water supply. is to prevent the practice (prevalent in the Marcos government) of skirting the 60/40 equation using the cover of service 241 contracts. or utilization of natural resources. all other natural resources shall not be alienated. The President with the concurrence of Congress. Such agreements may be for a period not exceeding twenty-five years. and under such term and conditions as may be provided by law. as well as cooperative fish farming. . Such activities may be directly undertaken by the state. The former. Such agreements shall be for a period of twenty-five years. or it may enter into coproduction. 496.P. may. there is no danger of relinquishing sovereignty to foreign interests. petroleum. as adopted. It recognizes the fact that as long as Filipinos can formulate their own terms in their own territory. adopted the concept of "agreements . fisheries. 3. and lagoons. lakes. joint venture. and utilization of natural resources. all forces of potential energy. All lands of the public domain. and lagoons. as well as cooperative fish farming in rivers. by two-thirds vote of all its members by special law provide the terms and conditions under which a foreign-owned corporation may enter into agreements with the government involving either technical or financial assistance for large-scale exploration. waters. or it may enter into co- Sec. flora and fauna. . development. allow small-scale utilization of natural resources by Filipino citizens. waters. The exploration. In cases of water rights for irrigation. and other natural resources are owned by the State. With the exception of agricultural lands. petroleum. and exclusive economic zone. The Congress may by law allow small-scale utilization of natural resources by Filipino citizens. or productionsharing agreements with Filipino citizens. bays. and other mineral oils DRAFT OF THE UP CONSTITUTION PROJECT LAW PROPOSED RESOLUTION NO. or corporations or associations at least sixty per centum of whose capital is owned by such citizens. and other mineral oils. fisheries or industrial uses other than the development for water power. lakes. minerals. Law Constitution Project" (U.] joint venture. Such activities may be directly undertaken by the State. fisheries. Sec. coal. production sharing agreements with Filipino citizens or corporations or associations sixty per cent of whose voting stock or controlling interest is owned by such citizens for a period of not more than twenty-five years. [Emphasis supplied. or industrial uses other than the development of water power. as well as Article XII. or industrial uses other than the development of water power. by special law. all other natural resources shall not be alienated. development. 2. it appears that Proposed Resolution No. Law draft) which was 243 taken into consideration during the deliberation of the CONCOM.] production-sharing agreements with Filipino citizens or corporations or associations at least sixty per cent of whose voting stock or controlling interest is owned by such citizens. and utilization of minerals. forests or timber. employed the same terminology. waters. The exploration. minerals. With the exception of agricultural lands. In case of water rights for irrigation. by law. [Emphasis supplied. shall provide the terms and conditions under which a foreign-owned corporation may enter into agreements with the government involving either technical or financial assistance for largescale exploration. renewable for not more than twenty-five years. water supply.

(Sec. the contractor has almost unfettered control over its disposition and sale.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 53 5. 12. distribution. Thus. 8. and even the domestic requirements of the country is relegated to a pro rata basis (Sec. the martial-law Constitution allowed them. and other properties remain with contractor (Sec. 13. and processing may be with the contractor (Sec. relegating the Filipino investors to the role of second-rate partners in joint ventures. If the service contractor happens to be a foreign corporation. thus: 1. management. Through the instrumentality of the service contract.D. the State shall promote the development and use of local scientific and technical resources. to enter into service contracts with foreign investors for financial.D. (Sec. The drastic impact of [this] constitutional change becomes more pronounced when it is considered that the active party to any service contract may be a corporation wholly owned by foreign interests. Professor Pacifico A. criticized service contracts for they "lodge exclusive management and control of the enterprise to the service contractor. permitting foreign corporations to obtain actual possession. of the country's natural resources." He elaborates: Looking at the Philippine model. of the exploitation of our 245 natural resources. Control of production and other matters such as expansion and development. Since foreign investors have the capital resources. 5. P. 8). While title to the petroleum discovered may nominally be in the name of the government. instructive in interpreting the phrase "technical or financial assistance. and 7. Some people have pulled an old rabbit out of a magician's hat. namely: the exploitation of the country's natural resources by foreign nationals. the actual exploitation and development. In such agreements. but the essence of nationalism was reduced to hollow rhetoric. [Emphasis supplied. the service contract system 244 renders nugatory the constitutional provisions cited. 87). 8) 4." In his position paper entitled Service Contracts: Old Wine in New Bottles?. once these resources are in their name. and [enjoyment] of the 246 country's natural resources. based on real contributions to the economic growth and general welfare of the country. as well as the effective disposition. also a member of the working group. The 1973 Charter still provided that the exploitation or development of the country's natural resources be limited to Filipino citizens or corporations owned or controlled by them. or leasing the choice of the area to the interested party and then negotiating the terms and conditions of the contract. or other forms of assistance.] Professor Merlin M. fixed assets. the 1973 Constitution had legitimized at the highest level of state policy that which was prohibited under the 1973 Constitution. our version of the service contract is just a rehash of the old concession regime x x x. we can discern the following vestiges of the concession regime. In short. and control. who was a member of the working group that prepared the U. [Emphasis supplied. within thirty days from its execution.P.D. 8). [Emphasis supplied.P. machinery. However. Management of the enterprise vested on the contractor. and foisted it upon us as a new and different animal. The service contract as we know it here is antithetical to the principle of sovereignty over our natural resources restated in the same article of the [1973] Constitution containing the provision for service contracts. technical. Responsibility for downstream operations – marketing. Agabin. 6. Law draft. Law draft are.D. control. and that these shall not be alienated. Bidding of a selected area. P. 87) 2. which is reminiscent of the old concession regime. Repatriation of capital and retention of profits abroad guaranteed to the contractor (Sec. P. would be under their direction. P. 87) 3. Ownership of equipment. (Sec. In such a case. The insights of the proponents of the U.] The President shall notify the Congress of every contract entered into in accordance with this provision.] according to the general terms and conditions provided by law. Underscoring in the original. was harsher in his reproach of the system: x x x the nationalistic phraseology of the 1935 [Constitution] was retained by the [1973] Charter. . including operation of the field if petroleum is discovered. the contract would also run counter to the constitutional provision on nationalization or Filipinization. Magallona. therefore. notwithstanding the provision of the Constitution that natural resources belong to the State. the citizenship requirement is completely set aside. 87).

Law draft proponents viewed service contracts under the 1973 Constitution as grants of beneficial ownership of the country's natural resources to foreign owned corporations. and the more liberal 1973 Constitution. by virtue of co-production. second. necessarily. are antithetical to the principle of sovereignty over our natural resources. acts prohibited by the Anti-Dummy Law were recognized as legitimate arrangements. The proponents nevertheless acknowledged the need for capital and technical know-how in the largescale exploitation. [Emphasis supplied. in . The Project explained: 3. as well as the constitutional provision on nationalization or Filipinization of the exploitation of our natural resources. having been given exclusive and plenary rights to exploit a particular resource and. such resources. This is justified by the fact that as presently worded in the 1973 Constitution. and only for large-scale activities. That is the only way we can exercise effective control over our natural resources. or leases – hence the provision that said activities shall be under the full control and supervision of the State. having been assured of ownership of that resource at the point of extraction (see Agabin. instead the government may be allowed. Service contracts lodge exclusive management and control of the enterprise to the service contractor. The last paragraph is a modification of the service contract provision found in Section 9.P. It was a subterfuge to get around the 248 nationality requirement of the constitution." assumes greater significance when note is taken that the U. in effect. "Nationalism and its Subversion in the Constitution"). in theory. than the present practice of granting licenses. subject to authorization by special law passed by an extraordinary majority to enter into either technical or financial assistance. "Service Contracts: Old Wine in New Bottles"). production-sharing – could still be utilized and adopted without violating constitutional provisions.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 54 Accordingly. Such a compromise called for the adoption of a new system in the exploration. and its "full control and supervision" (a phrase also employed by the framers) over. There are three major schemes by which the State could undertake these activities: first. Professor Agabin recommends that: Recognizing the service contract for what it is. proposed that: 2. development. directly by itself. and utilization of natural resources. and utilize the same. with a foreign-owned corporation. This 1973 provision shattered the framework of nationalism in our fundamental law (see Magallona. financial assistance [agreements]. Article XIV of the 1973 Constitution as amended. the State should take a more active role in the exploration. Through the service contract. for him to work. development. production sharing agreements with Filipino citizens or corporations or associations sixty per cent (60%) of the voting stock or controlling interests of which are owned by such citizens. In other words." as well as the deletion of the phrase "management or other forms of assistance. In line with the State ownership of natural resources. While. manage and dispose of the proceeds or production. and utilization of natural resources.P. Under the proposed provision. The proponents deemed these changes to be more consistent with the State's ownership of. Through the service contract. This should not mean complete isolation of the country's natural resources from foreign investment. [Emphasis supplied. These include the abrogation of the concession system and the adoption of new "options" for the State in the exploration. the U. only technical assistance or financial assistance agreements may be entered into. concessions. Other contract forms which are less derogatory to our sovereignty and control over natural resources – like technical assistance agreements. thus: 5. [Emphasis supplied. This will ensure that such agreements will be debated upon exhaustively and thoroughly in 249 the National Assembly to avert prejudice to the nation. joint venture. we can adopt contract forms which recognize and assert our sovereignty and ownership over natural resources. the 1973 Constitution had legitimized that which was prohibited under the 1935 constitution—the exploitation of the country's natural resources by foreign nationals. their beneficiaries – service contracts actually vested foreigners with the right to dispose. The replacement of "service contracts" with "agreements… involving either technical or financial assistance. Service contracts as practiced under the 1973 Constitution should be discouraged.] In the annotations on the proposed Article on National Economy and Patrimony. exploit.P. The proposal recognizes the need for capital and technology to develop our natural resources without sacrificing our sovereignty and control over such resources by the safeguard of a special law which requires two-thirds vote of all the members of the Legislature.] The U. Law draft summarized the rationale therefor. joint ventures. development. they recommended a compromise to reconcile the nationalistic provisions dating back to the 1935 Constitution. are distinct concepts from service contracts. a service contract gives full control over the contract area to the service contractor. These are contract forms which recognize and assert our sovereignty and ownership over natural resources since the foreign entity is just a pure contractor and not a beneficial owner of our economic resources. with the Regalian doctrine. explore for. not Filipinos. with Philippine sovereignty. not unlike the old concession regime where the concessionaire had complete control over the country's natural resources. became the beneficiaries of Philippine natural resources. and utilization of natural resources in the form of technical agreements or financial agreements which. the State owns these natural resources – and Filipino citizens. or third. Foreigners. This arrangement is clearly incompatible with the constitutional ideal of nationalization of natural resources. develop. Professor Eduardo Labitag. we have to expunge it from the Constitution and reaffirm ownership over our natural resources. which reserved all natural resources exclusively to Filipinos. hence. co-production agreements. Hence. Law draft proposed other equally crucial changes that were obviously heeded by the CONCOM. Service contracts. and where the foreign entity is just a pure contractor instead of the 247 beneficial owner of our economic resources. and on a broader perspective.] Still another member of the working group. which allowed foreigners to participate in these resources through service contracts. development and utilization of natural resources – the second paragraph of the proposed draft itself being an admission of such scarcity.

such remark is far outweighed by his more categorical statement in his exchange with Commissioner Quesada that the draft article "does not permit foreign investors to participate" in the nation's natural resources – which was exactly what service 253 contracts did – except to provide "technical or financial assistance. grantees. This is in recognition of the plight of marginal fishermen. to refer. it should be subject. Commissioner Nolledo himself clarified in his work that the 254 present charter prohibits service contracts. involving either technical or financial assistance. Section 33. 4. The proposed role of the State will enable it to a greater share in the profits – it can also actively husband its natural resources and engage in developmental programs that will be beneficial to them. therefore. It is true that. by law. drilling. such provision must be construed strictly against their enjoyment by 259 non-Filipinos. they may not have been necessarily referring to the concept of service contracts under the 1973 Constitution. as shown in the earlier quoted portions of the proceedings in CONCOM. the only difference between "future" and "past" "service contracts" is the requirement of a general law as there 252 were no laws previously authorizing the same. However. Commissioner Gascon was not totally averse to foreign 255 participation. This Court is not. No. "Old wine in new bottles. trending. after taking pains to illustrate the similarities between the two systems. for it is the courts that finally determine what the law means. Law proponents in employing the phrase "agreements . In light of the deliberations of the CONCOM. utilize natural resources in small-scale. to agreements concerning natural resources entered into by the Government with foreign corporations. shaft sinking. it merely interprets a pre-existing law. Although the statute employs the phrase "financial and technical agreements" in accordance with the 1987 Constitution. Commissioner Villegas commented that. however. Such benefits are very minimal compared with the enormous profits reaped by theses licensees. other than congressional notification. "service contracts" is a term that assumes different meanings to 251 different people. Eligibility. concluded that the service contract regime was but a "rehash" of the concession system. test pitting. and utilization of mineral resources in the Philippines may enter into a financial or technical assistance agreement directly with the Government through the Department." Commissioner Nolledo also remarked that "entering into service contracts is an exception to the rule on protection of natural resources for the interest of the nation and." While certain commissioners may have mentioned the term "service contracts" during the CONCOM deliberations. [Emphasis supplied.] "Exploration. being an exception. development. 1987. At present. is in consonance with the abolition of the concession system.P. Tan's question. As Commissioner Villegas emphasized. development. and the adoption of other proposed changes. in particular. develop. the text of the Constitution. . WMCP cites Opinion No. 1990 of the Secretary of Justice. therefore. 7942. The rejection of the service contract regime. geochemical or geophysical surveys. s." as he put it.A. In any case. allow Filipino citizens to explore. means the searching or prospecting for mineral resources by geological. and the administrative interpretation of the law is at best 258 advisory. tunneling or any other means for the 256 257 . The commissioners may have been using the term loosely. expressing the view that a financial or technical assistance agreement "is no different in concept" from the service contract allowed under the 1973 Constitution. concessionaires. 175.A. 33. As noted earlier. 7942 is invalid insofar as said Act authorizes service contracts. Professor Agabin. the constitutional provision allowing the President to enter into FTAAs with foreign-owned corporations is an exception to the rule that participation in the nation's natural resources is reserved exclusively to Filipinos. in general. s. and utilization of our natural resources. remote sensing. some of them disregard the conservation of natural resources and do not protect the environment from degradation. development. Aside from the three major schemes for the exploration. the provision is "very restrictive. exceptions should be strictly but reasonably construed. With the foregoing discussion in mind. and not in its technical and legal sense. On the other hand. ad valorem taxes and income taxes of the exploiters of our natural resources.—Any qualified person with technical and financial capability to undertake large-scale exploration. there is no doubt that the framers considered and shared the intent of the U. or utilization of natural resources through agreements involving either technical or financial assistance only." as defined by R. which is found under Chapter VI (Financial or Technical Assistance Agreement) of R. bound by this interpretation. they extend only so far as their language fairly warrants and all doubts should be resolved in favor of the 261 general provision rather than the exception." Indeed. but favored stricter restrictions in the form of majority congressional concurrence. in response to Sr. When an administrative or executive agency renders an opinion or issues a statement of policy.A. gold panners. the State may. No. 75. 260 whenever possible. it actually treats these agreements as service contracts that grant beneficial ownership to foreign contractors contrary to the fundamental law. forest dwellers. Commissioners Garcia and Tadeo may have veered to the extreme side of the spectrum and their objections may be interpreted as votes against any foreign participation in our natural resources whatsoever. These loose statements do not necessarily translate to the adoption of the 1973 Constitution provision allowing service contracts. this Court finds that R.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 55 cases of large-scale exploration. x x x. to stringent rules. Accordingly. 7942 states: SEC. and 250 others similarly situated who exploit our natural resources for their daily sustenance and survival. the government benefits from such benefits only through fees. No. Moreover." In the case of the other commissioners. charges. . under the licensing concession or lease schemes. and Opinion No.

275 development.A. Parenthetically. means mining activities involving exploration. .A. whether by design or inadvertence. may apply for a 266 financial and technical assistance agreement. A legally organized foreign-owned corporation may be granted an exploration permit. which authorizes the issuance of a mineral processing permit to a contractor in a financial and technical assistance agreement. the same provisions. (2) Section 23." insofar as it applies to a financial or technical assistance agreement. Chapter XII of the Act grants foreign contractors in FTAAs the same auxiliary mining rights 276 that it grants contractors in mineral agreements (MPSA. That a legally organized foreign-owned corporation shall be deemed a qualified person for purposes of granting an exploration permit. and processing. an FTAA contractor warrants that it "has or has access to all the financing. under the Act. The following provisions of the same Act are likewise void as they are dependent on the foregoing provisions and cannot stand on their own: (1) Section 3 (g). feasibility. i. which prescribes the eligibility of a contractor in a financial or technical assistance agreement. 7942 have in effect conveyed beneficial ownership over the nation's mineral resources to these contractors. "Development" is the work undertaken to explore and prepare an ore body or a mineral deposit for 267 mining. the Court finds the following provisions of R. extent. leaving the State with nothing but bare title thereto. and other relevant data for its mining operation. therefore." A stipulation that the proponent shall dispose of the minerals and byproducts produced at the highest price and more advantageous terms and conditions as provided for under the implementing rules and regulations is required to be incorporated in 269 every FTAA. 279 managerial. which specifies the rights and obligations of an exploration permittee. which defines "qualified person. By allowing foreign contractors to manage or operate all the aspects of the mining operation. . No. The underlying assumption in all these provisions is that the foreign contractor manages the mineral resources." as the law defines it. 7942 and its implementing rules and for work programs and minimum 273 expenditures and commitments. Article XII of the Constitution: (1) The proviso in Section 3 (aq). (5) Section 39. insofar as said section applies to a financial or technical assistance agreement. development and utilization of Philippine natural resources.A. which vests it 264 with the right to conduct exploration for all minerals in specified areas. No. CA and JV). A foreign-owned/-controlled corporation may likewise be granted a mineral processing 270 permit. And it obliges itself to furnish the Government records of geologic. "Mineral processing" is the milling. proscribed by the present Charter. permit a circumvention of the constitutionally ordained 60%-40% capitalization requirement for corporations or associations engaged in the exploitation. which defines the term "contractor. which allows the contractor in a financial and technical assistance agreement to convert the same into a mineral production-sharing agreement. including the construction of necessary infrastructure and related facilities. as such permittee. "Mining operation. 284 283 282 281 280 . In sum. to enter. the foreign-owned corporation. (3) Section 33. "Utilization" "means the extraction or disposition of minerals. A foreign contractor may even convert its FTAA into a mineral agreement if the economic viability of the contract area is found to be inadequate to justify large277 scale mining operations.e. quantity and quality thereof and the feasibility of mining 262 them for profit. Eventually. An FTAA contractor makes a warranty that the mining operations shall be conducted in accordance with 272 the provisions of R. beneficiation or upgrading of ores or minerals and rocks or 271 by similar means to convert the same into marketable products. Sections 72 to 75 use the term "contractor. financial or technical assistance agreement or mineral processing permit.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 56 purpose of determining the existence." without distinguishing between FTAA and mineral agreement contractors. 7942 to be violative of Section 2. And so does "holders of mining rights" in Section 76. occupy and 265 explore the same." This suggests that an FTAA contractor is bound to provide 268 263 some management assistance – a form of assistance that has been eliminated and. association 278 or cooperative to forty percent (40%). Finally. partnership. . Moreover. just like the foreign contractor in a service contract. (4) Section 35. which enumerates the terms and conditions for every financial or technical assistance agreement. utilization. the abovecited provisions of R. provided that it reduces its equity in the corporation. 274 accounting. (6) Section 56." to wit: Provided. No. and technical expertise.. Furthermore.

Pursuant to Section 1. 291 The second and third paragraphs of Section 81. 292 All materials. (c) to determine the mining and treatment processes to be utilised during the Development/Operating Period and the project facilities to be constructed during the Development and Construction Period. equipment and infrastructure and the Minerals produced from the Mining Operations.3 of the WMCP FTAA grants WMCP "the exclusive right to explore. clay. subject to pertinent laws. modify. stone. (h) enjoy. utilise[. . all the provisions which are thus dependent. equipment. and Section 90. 290 289 which allows the withdrawal of the contractor in an FTAA. or compensations for each other. xxx (f) to construct roadways. if some parts are unconstitutional. grant WMCP beneficial ownership over natural resources that properly belong to the State and are intended for the benefit of its citizens. inducements. which provides for incentives to contractors in FTAAs insofar as it applies to said contractors. Section 1.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 57 Section 34. plant and other installations erected or placed on the Contract Area remain the property of WMCP. providing all necessary services. which provide for the Government's share in a financial and technical assistance agreement. equipment and other installations that may be required for carrying on all 298 Mining Operations. power generation and transmission facilities and all other types of works on the Contract Area. which prescribes the maximum contract area in a financial or technical assistance agreements. sell or otherwise dispose of. 286 285 which allows negotiations for financial or technical assistance agreements. which has the right to deal with and remove such items within twelve months from 296 the termination of the FTAA. 288 287 which limits the term of financial or technical assistance agreements. supplies. . then. install or place any type of improvements. with full right of ingress and egress and the right to occupy the same. These stipulations are abhorrent to the 1987 Constitution. These contractual stipulations. 293 conditional. subject to the provisions of Presidential Decree No." and to "furnish all materials. exploit. WMCP shall provide "[all] financing. improvements and replacements of the mining 299 facilities and may add such new facilities as it considers necessary for the mining operations. labour. Section 41. which prescribes the procedure for filing and evaluation of financial or technical assistance agreement proposals. exploring and exploiting for minerals therein. must fall with them. There can be little doubt that the WMCP FTAA itself is a service contract. When the parts of the statute are so mutually dependent and connected as conditions. rules and regulations and the rights of third Parties. the legislature would not pass the residue independently. . water and other natural resources in the Contract Area without cost for the purposes of the Mining Operations. Section 38. mining.] process and dispose of all Minerals products and by-products thereof that may be produced from the Contract 294 Area. the plant. which allows the assignment or transfer of financial or technical assistance agreements. taken together." The FTAA also imbues WMCP with the following rights: (b) to extract and carry away any Mineral samples from the Contract area for the purpose of conducting tests and studies in respect thereof. machinery and other equipment relating to the Mining Operations and to use. technology. x x x. (d) have the right of possession of the Contract Area. sand." The mining company binds itself to "perform all Mining 297 Operations . charge or encumber all or part of its interest and obligations under this Agreement. or connected. management and personnel necessary for the Mining Operations. xxx (i) have the right to mortgage. as to warrant a belief that the legislature intended them as a whole. considerations. drainage. They are precisely the vices that the fundamental law seeks to avoid. 295 Section 37. easement rights and the use of timber. 512 (if applicable) and not be prevented from entry into private ands by surface owners and/or occupants thereof when prospecting.2 of the FTAA. remove or diminish any and all parts thereof. Section 40. and that if all could not be carried into effect." > WMCP may make expansions. (g) to erect. Section 36. technology and financing in connection therewith.

One other matter requires clarification. and 305 unreasonable or absurd consequences. WMCP invokes the Agreement on the Promotion and Protection of Investments between the Philippine and Australian Governments. development and utilization of natural resources. which. Laws. if possible. hence. which was signed in Manila on January 25. Consequently. The equal protection clause guarantees that such decision shall apply to all contracts belonging to the same class. it is argued. WHEREFORE.] Surely. in turn. . Simply stated. in entering into said treaty is assumed to be aware of the existing Philippine laws on service contracts over the exploration. (d) Section 56. which requires the performance in good faith of treaty obligations. The execution of the FTAA by the Philippine Government assures the Australian Government that the FTAA is in accordance with existing Philippine 300 laws. the contract from which they spring must be struck down. would constitute a breach of said treaty which. (b) Section 23. rely upon the inadequacies of its own laws to deprive an Australian investor (like [WMCP]) of fair and equitable treatment by invalidating [WMCP's] FTAA without likewise nullifying the service contracts entered into before the enactment of RA 7942 such as those mentioned in PD 87 or EO 279. is a technical and financial assistance agreement. For this decision herein invalidating the subject FTAA forms part of the legal system of the 301 302 Philippines. it states that "Each Party shall ensure that investments are accorded fair and equitable treatment. the framers of the 1987 Charter did not contemplate such an absurd result from their use of "either/or. should be avoided. Article II of the Constitution adopting the generally accepted principles of international law as part of the law of the land." the annulment of the FTAA would not constitute a breach of the treaty invoked. (e) The second and third paragraphs of Section 81." A constitution is not to be interpreted as demanding the impossible or the impracticable. the President may enter into agreements involving "either technical or financial assistance" only. Courts are not to give words a meaning that would lead to absurd or unreasonable consequences and a literal interpretation is to be 306 rejected if it would be unjust or lead to absurd results. the Philippines could not. consistent with the provisions of Section 2. Even assuming arguendo that WMCP is correct in its interpretation of the treaty and its assertion that "the Philippines could not . through its President no less. deprive an Australian investor (like [WMCP]) of fair and equitable treatment by invalidating [WMCP's] FTAA without likewise nullifying the service contracts entered into before the enactment of RA 7942 . would amount to a violation of Section 3. Accordingly. Article XII of the Constitution. Article 3 (1) of the treaty provides that "Each Party shall encourage and promote investments in its area by investors of the other Party and shall [admit] such investments in accordance with its Constitution. upholding rather than violating. the "fair and equitable treatment" stipulation in said treaty. The agreement in question. or to execute two (2) contracts with only one foreign-owned corporation which has the capability to provide both financial and technical assistance. In arguing against the annulment of the FTAA. The foregoing discussion has rendered unnecessary the resolution of the other issues raised by the petition." The latter stipulation indicates that it was intended to impose an obligation upon a Party to afford fair and equitable treatment to the investments of the other Party and that a failure to provide such treatment by or under the laws of the Party may constitute a breach of the treaty. but by the Philippine Government itself. Likewise.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 58 the evils that it aims to suppress. . Such an absurd result is definitely not sanctioned under the canons of constitutional 304 construction. one for financial assistance and another for technical assistance. This becomes more significant in the light of the fact that [WMCP's] FTAA was executed not by a mere Filipino citizen. regulations and investment policies" and in Article 3 (2). the petition is GRANTED. 1995. x x x. over the same mining area.] The invalidation of the subject FTAA.. One of these generally accepted principles is pacta sunt servanda. petitioners' interpretation must be rejected. Article 2 (1) of said treaty states that it applies to investments whenever made and thus the fact that [WMCP's] FTAA was entered into prior to the entry into force of the treaty does not preclude the Philippine Government from protecting [WMCP's] investment in [that] FTAA. That is a strong argument against its 307 adoption. . under said treaty. 7942: (a) The proviso in Section 3 (aq). however. . To adhere to the literal language of the Constitution would lead to 303 absurd consequences. 1995 and which entered into force on December 8. (c) Section 33 to 41. [Underscoring in the original. [Emphasis and italics by private respondents. The Court hereby declares unconstitutional and void: (1) The following provisions of Republic Act No. for technical assistance over one and the same mining area or land. Petitioners contend that. As WMCP correctly put it: x x x such a theory of petitioners would compel the government (through the President) to enter into contract with two (2) foreign-owned corporations. and . one for financial assistance agreement and with the other. Petitioners' contention does not lie.

Ltd. XI. see Separate Ynares-Santiago. 279 (1987). p. 21 Id. no part. 7942 provides that the Act "shall take effect thirty (30) days following its complete publication in two (2) newspapers of general circulation in the Philippines. 3. C. ch. 22. 51-52. 53 Section 12. Id. 43 Rollo.) 5 An Act Instituting A New System of Mineral Resources Exploration. sec. sec. ch. 27 Id. 38 Ibid. Inc.. 13 Id.. ch. one of the parties was a client. at 761-763. Opinion.. 40 Id. sec.) Subsequently. 23 Id.. at 52-53.. sec.. VI.. 33 Section 116.R... Footnotes 1 2 18 19 concur. secs.. 11 Id. XIII. 156214.. 45. sec.. 754. 1996 which are not in conformity with this Decision. XV. 55 Ibid. 52 G.. Appears as "Nequito" in the caption of the Petition but "Nequinto" in the body. 27 and 33 in relation to sec.. 29 Id. 30. Development. Carpio. WMC Resources International Pty. 25 Id.. 29. The number has since risen to 129 applications when the petitioners filed their Reply..) 39 Id. 12. 10 Id. ch. Sr. 8 Rep..-G. p. " The appeal shall not stay the award. 7 Exec. 48 Id. 73... ch. 30 Id. and Prescribing the Guidelines for such Agreements and those Agreements involving Technical or Financial Assistance by Foreign-Owned Corporations for Large-Scale Exploration. Sandoval-Gutierrez and Austria-Martinez.. Development and Utilization of Minerals. Id. decided September 24. judgment. 31. Opinion. secs.. 76. 75. Jr. p. Panganiban's separate Azcuna. Inc. 28 Id. Peria as one of the petitioners but the name of his father Elpidio V. 20-22. sec. ch.) 4 Erroneously designated in the Petition as "Western Mining Philippines Corporation." (Id. entitled Lepanto Mining Company v. ch. Puno. was renamed "Tampakan Mineral Resources Corporation. No. 2003) to Petitioners' Comment (to the Manifestation and Supplemental Manifestation).. 7942 (1995).. Davide. (Id. 42 WMCP FTAA. 17 Id. at 755. Corona. WMC (Philippines).. invoked by private respondent.." (Id. 2. Southcot Mining Corporation. No. X.. sec. p.. Rule 43 of the Rules of Court.. (Rollo. No. 37 Ibid. see Separate Panganiban. XVI. Act No.. 15. 41 Id.. 44 Id.. secs. 35 Rollo. SO ORDERED. No. R.. 74161.. p. sec." 34 WMCP FTAA. 16 Id. sec.. 36 Ibid. .. J. 4. XIX. sec.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 59 (f) Section 90. 12 Id. ch. 50 Id. Vitug..R. 3 Appears as "Kaisahan Tungo sa Kaunlaran ng Kanayunan at Repormang Pansakahan (KAISAHAN)" in the caption of the Petition by "Philippine Kaisahan Tungo sa Kaunlaran ng Kanayunan at Repormang Pansakahan (KAISAHAN)" in the body. sec. (Id. 9 Id.A.) The caption of the petition does not include Louel A. joins J. 45 Vide Note 4. 51 Docketed as C. final order or resolution sought to be reviewed unless the Court of Appeals shall direct otherwise upon such terms as it may deem just. and Tinga. Peria appears therein. 363. s.J. at 782-786.. 31 Id. at 13. 26 Id. at 14. secs. Co-Production.. WMC Resources International Pty. 43. Utilization and Conservation... at 23-24. (Rollo. at 754. R. J.) As appears in the body of the Petition. and (3) The Financial and Technical Assistance Agreement between the Government of the Republic of the Philippines and WMC Philippines. p. 220. 6 Authorizing the Secretary of Environment and Natural Resources to Negotiate and Conclude Joint Venture. Development and Utilization of Mineral Resources. 46-49. 22 Id. 4. 72." 54 WMCP's Reply (dated May 6. 153885.. 46 Rollo. sec. 47 Id... Ltd. 20 Id.A. 2003 and G. ch. 56 Ibid. decided September 23. IX. 14 Id. entitled Lepanto Consolidated Mining Company v. Inc. et al.. 26 (a)-(c). XVII. XIV. opinion. 74.. 49 Id. 32. 15 Id. (2) All provisions of Department of Environment and Natural Resources Administrative Order 9640. 2003... 24 Id. or Production-Sharing Agreements for the Exploration. 32 Id.1.. at 778.. Inc. at 212. sec. Tampakan Mining Corporation and Sagittarius Mines. JJ. 3 (aq). JJ. at 764-776. at 22. Callejo. states. p. Order No. WMC (Philippines). ch. Quisumbing. Emphasis and underscoring supplied.

Dabie. 260 SCRA 88 (1996). 437. and silver as distinct from the right of ownership of the land in which the minerals were found. until specially granted to private individuals. that "the prohibition in the [1935] Constitution against alienation by the state of mineral lands and minerals is not properly a part of the Regalian doctrine but a separate national policy designed to conserve our mineral resources and prevent the state from being deprived of such minerals as are essential to national defense." The first Spanish mining law promulgated for these Islands (Decree of Superior Civil Government of January 28.. 4. Dabie. . all the rest of said lands may remain free and unencumbered for us to dispose of as we may wish. 59 Dumlao v. 42 Phil. the right to the ownership of minerals was extended to base metals. and they cannot be disposed of without the government authority. Yap. Labuayan. and after distributing to the natives what may be necessary for tillage and pasturage. the Code in its articles 426 and 427 (Art. COMELEC. Colet. 330 SCRA 318 (2000). without express grant.) 85 In the unpublished case of Lawrence v. still pertaining to the royal crown and patrimony. Zamora. 261 SCRA 528 (1996). Garduño (L-10942. 70 Rollo.] 77 Joya v. and all lands. 139 (1936). In its Article 339 (Article 420. J. Bernas. 95 SCRA 392 (1980). Vera. Apacible and Cuisia. 58 Philippine Constitution Association v. Enriquez. 90 McDaniel v. J. 62 Subic Bay Metropolitan Authority v. Benjie L. The New Mining Law. v. Insular Government.. Philippine Law on Natural Resources 6 (1961). 56 (1937). amended by the law of March 4. Zamora. COMELEC.Ed. Mario L. OND. pastures. 63 Angara v. 64 Integrated Bar of the Philippines v.) 84 Cruz v. Bolanio. Secretary of Environment and Natural Resources. Noblejas continues: Thus. territories. at 5. Quintol A. M. Separate Opinion. 69 Petitioners F'long Agutin M. 82 Cariño v. 71 Id.. Tusan. Dimagiba. citing V. 63 Phil.. in article 2 says: "The ownership of the substances enumerated in the preceding article (among them those of inflammable nature). supra. but also their future and their probable increase. Separate Opinion." Article 2 of the royal decree on ownership of mines in the Philippine Islands. Tacuayan. supra. 78 Integrated Bar of the Philippines v. It has been noted. Gusanan. audiencias. 595 (1909). Francisco. the mines that might be found therein.]. City Mayor of Manila¸ 21 SCRA 449 (1967). 100 (2000). confirming them in what they now have and giving them more if necessary. Puno. Commission on Elections. citing Malabanan v. COMELEC. at 337. Inc. 86 Atok Big-Wedge Mining Co. Presidential Commission on Good Government. Analogous provisions are found in the Civil Code of Spain determining the ownership of mines. J. 65 Phil. Leny B. taking into consideration not only their present condition. Court of Appeals. Secretary of Environment and Natural Resources. Gradually. an exception is made as far as mining laws are concerned. Intermediate Appellate Court. supra. in its Article I.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 60 57 WMCP's Reply (dated May 6. Rose Lilia S. Title 12. and possessions not heretofore ceded away by our royal predecessors. Dumlao v. Law 14. Mangcal. and commons in those places which are peopled. They shall not be exploited except by persons who obtained special grant from this superior government and by those who may secure it thereafter. New Civil Code) declaring that the proprietor of any parcel of land is the owner of its surface and of everything under it. 76 Cruz v. New Civil Code) provides rules governing the digging of pits by third persons on private-owned lands for the purpose of prospecting for minerals. at 6. Marcelo L. they asserted their right of ownership over mines and minerals or precious metals. For instance. 57 Phil. supra. Secretary of Environment and Natural Resources. supra. Ongpin. or by us. Dumlao v. 88 Cruz v. 6. 519. Kapunan. J. National Economic Protectionism Association v. 749 (1922). Alden S. 160 SCRA 228 (1988). Gusanan. locating and exploring mines in private property by persons other than the owner of the land as well as the granting of concessions. Simeon H. and Panganiban. Separate Opinion. Thus. 89 Ibid. A. 80 Cruz v. 1864).. 87 Ibid. Philippine Law on Natural Resources 14-15 [1956]). Philippine Law on Natural Resources 126-127 [1959 ed. Susuan O. Book 4 of the Recopilacion de Leyes de las Indias proclaimed: We having acquired full sovereignty over the Indies. they grant or sell it as a right separate from the land. 74 Militante v. Amloy. Dolojo.. [Emphasis supplied. or in our name. 262 SCRA 492 (1996). Then in speaking of minerals. 53 L. says: "The supreme ownership of mines throughout the kingdom belong[s] to the crown and to the king. 181 SCRA 84 (1990). says: "The ownership of the substances enumerated in the preceding article (among them those of inflammable nature) belongs to the state. 75 Ibid. belong[s] to the state. supra. Sr. citing A.J. The 1987 Constitution of the Philippines: A Commentary 1009 (1996). 212 US 449. p. People v. 73 People v. dated May 14. Gaw Ching.. which was the law in force at the time of the cession of these Islands to the Government of the United States. Service Contract Concepts in Energy. Lomingges Laway." (A. In its article 350 (Art. Francisco. Romano and Amparo S. The Spanish law of July 7. supra. Imelda Gandon. Secretary of Environment and Natural Resources. supra. Raqim L. supra. 1867. 91 Noblejas. Noblejas. 67 Ermita-Malate Hotel and Motel Operators Association. 92 V. COMELEC. 307. Zamora. all those laws contained provisions regulating the manner of prospecting. 79 J. p. New Civil Code) enumerating properties of public ownership. and they cannot be disposed of without an authorization issued by the Superior Civil Governor. when on a piece of land mining was more valuable than agriculture. J. the sovereign retained ownership of mines although the land has been alienated to private ownership. which goes to show that private ownership of the land did not include. supra. 66 Integrated Bar of the Philippines v. Noblejas. 313 (1982). J. ways. 65 Dumlao v. 338 SCRA 81. COMELEC. this Court observed: The principle underlying Spanish legislation on mines is that these are subject to the eminent domain of the state. Vera. and governors may seem necessary for public squares. Lolita G. 1867. Demonteverde. Kapunan. 81 Id. 171 SCRA 657 (1989). it is our will that all lands which are held without proper and true deeds of grant be restored to us according as they belong to us. golds. 2003) to Petitioners' Comment (to the Manifestation and Supplemental Manifestation). 60 Board of Optometry v. Electoral Commission.. supra. Nequinto. 83 Republic v. (Id. subject to this regulation. L. If the sovereign did not exploit the minerals. 72 246 SCRA 540 (1995). quoted in V. Kapunan. and Benita P. 68 Petitioners Roberto P. in order that after reserving before all what to us or to our viceroys.. however. Separate Opinion." Furthermore. 61 Dumlao v. 235 SCRA 506 (1994). J. v. Court of Appeals. Separate Opinion. the mines are included. Separate Opinion. 225 SCRA 568 (1993). 1868. 347 SCRA 128 (2000). S. Kapunan.

A. supra. as amended. with the nationals of foreign countries having the opportunity to own or control them. 107 Atok Big-Wedge Mining Co. x x x. 106 Ibid. R. 48 SCRA 372 (1972). A. 62 Phil. 10. exploitation. The nationalization of natural resources was also intended as an instrument of national defense. Aruego. 123 Ibid.. Filipino capital had been known to be rather shy. Republic v. at 103. The same provision recognized the rights of American citizens under the Parity Amendment: During the effectivity and subject to the provisions of the ordinance appended to the Constitution of the Philippines. as amended. Intermediate Appellate Court.. and under the same conditions imposed upon. 105 Ibid. directly or indirectly. at 605-606. with the Filipinos of the future serving not as owners but at most as tenants or workers under foreign masters. 115 An Act to Promote the Exploration. be open to citizens of the other Party and to all forms of business enterprise owned or controlled directly or indirectly. by citizens of the United States shall enjoy the same rights and obligations under the provisions of this Act in the same manner as to. The disposition. art. Service Contracts: Old Wine in New Bottles?. art. Law Constitution Project 3. would mean the retardation of the development of the natural resources. and other natural resources of either Party. timber. 96 Ibid.. coal. 127 Id. 64.. Agabin. to Appropriate Funds therefor. Act No. The Republic of the Philippines reserves the power to deny any of the rights specified in this Article to citizens of the United States who are citizens of States.. 387 (1949). art. 125 Id. 5. 9. supra. waters. 60. the delegates knew. or to corporations or associations which ore owned or controlled by citizens of the Philippines x x x. 122 Id. By all means. 25. all forces and sources of potential energy. 646 (1935). it was believed. at 2-3. Location and Lease of Lands Containing Petroleum and other Mineral Oils and Gas in the Philippine Islands. 110 Id.. 3. 126 Id. For unless the natural resources were nationalized. the delegates believed. Development.. which deny like rights to citizens of the Philippines. 109 II J. v.. supra. San Jose Petroleum Inc. Quasha. art. David. 101 Agabin. art. the natural resources should be conserved for Filipino posterity. 113 Atok Big-Wedge Mining Co. art. citizens of the Philippines or corporations or associations owned or controlled by citizens of the Philippines. 98 Ibid.. 130 Rep. art. 119 Id. 387 originally imposed an annual exploration tax on exploration concessionaires but this provision was repealed by Section 1.. art. R. 111 Id. conflicts of interest among them might arise inviting danger to the safety and independence of the nation. 94 Id.. 65. The Convention felt that to permit foreigner to own or control the natural resources would be to weaken the national defense. at 604. thereby increasing the possibility of foreign control. supra. at 1009-1010. 387 (1949). with respect to natural resources in the public domain in the Philippines. and the operation of public utilities.. This general apathy. 116 Rep. minerals. Act No.J. 95 Id. 103 Ibid. art. 4304. 121 Id. supra. development and utilization of all agricultural. It would be making possible the gradual extension of foreign influence into our politics. Not only these. v. 3. would prevent making the Philippines a source of international conflicts with the consequent danger to its internal security and independence. citizens of the United States and all forms of business enterprises owned and controlled. 104 Ibid. 118 Id. (Id. art. Article 49. and Utilization of the Petroleum Resources of the Philippines. shall. 102 People v. Delegate Aruego expounds: At the time of the framing of the Philippine Constitution. The Framing of the Philippine Constitution 592 (1949). to Authorize the Secretary of Agriculture and Natural Resources to Create an Administration Unit and a Technical Board in the Bureau of Mines. 18 SCRA 924 (1966). or to corporations or associations at least 60% of whose capital stock or capital is owned or controlled by citizens of States. The rights provided for in Paragraph 1 may be exercised x x x in the case of citizens of the United States. exploitation. No.. Exploitation. The United States of America reserves the rights of the several States of the United States to limit the extent to which citizens or corporations or associations owned or controlled by citizens of the Philippines may engage in the activities specified in this Article. 100 An Act to Provide for the Leasing and Development of Coal Lands in the Philippine Islands. art. 120 Id. 99 An Act to Provide for the Exploration. at 3. 114 Article VI thereof provided: 1. at 103. 387 (1949). Act No. 128 Id. .) 112 Palting v. 8. at 600-601. 129 Francisco. 10 (c). They had not as yet been so used to corporate enterprises as the peoples of the West. art. 97 Ibid.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 61 93 P. and mineral lands of the public domain.. as amended. 117 Id. But there was a general feeling in the Convention that it was better to have such development retarded or even postponed altogether until such time when the Filipinos would be ready and willing to undertake it rather than permit the natural resources to be placed under the ownership or control of foreigners in order that they might be immediately developed. No. The nationalization of the natural resources. at 3.. by citizens of such other Party in the same manner as to and under the same conditions imposed upon citizens or corporations or associations owned or controlled by citizens of the Party granting the right. Intermediate Appellate Court.P. to Encourage the Conservation of such Petroleum Resources. 108 Bernas. Linsangan. in II Draft Proposal of the 1986 U. 10 (b). citing Lee Hong Hok v. 46 SCRA 160 (1972).A. petroleum and other mineral oils.. and for other purposes. unless foreign capital would be encouraged to come in and help in that development. and utilization of the natural resources of the country. They knew that the nationalization of the natural resources would certainly not encourage the investment of foreign capital into them. Filipinos hesitated as a general rule to invest a considerable sum of their capital for the development.. 31. art. only through the medium of a corporation organized under the laws of the Philippines and at least 60% of the capital stock of which is owned or controlled by citizens of the United States x x x. if open to any person. supra. S. 124 Rep. 47. 131 Francisco. 2.

calling a convention to propose amendments to the Constitution of the Philippines. 93. the President issued Proclamation No. as amended. Magallona. 167 Allowing Citizens of the Philippines or Corporations or Associations at least Sixty Per Centum of the Capital of which is Owned by such Citizens to Enter into Service Contracts with Foreign Persons.. 147 Agabin. Legal Aspects of Production Sharing Contracts in the Indonesian Petroleum Industry. equipment. 95 (e). 101-102. Act No. 1081 placing the entire Philippines under Martial Law. In both arrangements.J. supra. Said Resolution No. 144 Dimagiba. 1. 1970. was implemented by Republic Act No. 139 Id. at 6. sec. art. more particularly. 148 M. This is not so in the production sharing system. in Espiritu. 155 Ibid. art. 8. 1972. S. 142 Dimagiba. sec.) 160 Agabin. 6132 approved on August 24. citing Fabrikant. The Economic Provisions in the 1973 Constitution. 87 (1972). supra. Act No. The concession system. however. and appropriating funds therefor. 141 Rep.. supra. 4. 90 (b) 3. Decree No. sec. 90 (b) 4. 87.. 9. at 1016. 138 Id. 6. This is not so in the service contract system. 7. work and financial obligations are required of the developer. In both systems. 387 (1949). 87 (1972). supra. Of the net proceeds the parties are entitled percentages of share that will accrue to each of them. supra. 134 Id. 163 Agabin. 158 Id. citing Session of November 25. 9 World Bull. the President issued Proclamation No. Id. Duly authorized representatives of the Government could. 1979 Philconsa Reader on Constitutional and Policy Issues 449. 1. 8 issued on October 2. the greater the produce. pursuant to the provisions of which the election of delegates to said convention was held on November 10... 6. sec. adopted on June 17.. 73. 1972. 93-A. art. 146 Pres. 13. supra. supra. supra. . 154 Ibid. Decree No. Oil Discovery and Technical Change in Southeast Asia. 1972. at 4. 387 and Presidential Decree No.. at 315.. 87 (1972). 140 Ibid. Congress of the Philippines passed Resolution No. art. Amending for the purpose certain provisions of Commonwealth Act No. submitting to the Filipino people for ratification or rejection the Constitution of the Republic of the Philippines proposed by the 1971 Constitutional Convention. as well as setting the plebiscite for such ratification on January 15. A certain percentage of the gross production is set aside for recoverable expenditures by the contractor. 1973. 150 Id. 143 Agabin. as amended. 170 Revising and Consolidating All Laws and Decrees Affecting Fishing and Fisheries. 1967. 166 Ibid. In the production-sharing arrangement. 4. 151 Id. supra. 1971. In the royalty system. 2. 1102 certifying and proclaiming that the Constitution proposed by the 1971 Constitutional Convention "has been ratified by an overwhelming majority of all the votes cast by the members of all the Barangays (Citizens Assemblies) throughout the Philippines.J. Executive Secretary. at 318. 164 Bernas. On January 17. art. differs considerably from the service contract system in important areas of the operations. the Government plays a passive role in the concession system. as amended. 1970. at 330-331. interested in receiving royalties from the concessionaire. 159 Dimagiba draws the following comparison between the service contract scheme and the concession system: In both the concession system and the service contract scheme. the Government plays a more active role in the management and monitoring of oil operations and requires the service contractor entertain obligations designed to bring more economic and technological benefits to the host country. 12. 168 Pres. 153 Id. and Promulgating an Amended Act to Promote the Discovery and Production of Indigenous Petroleum and Appropriate Funds Therefor. the explorationist/developer is given incentives in the form of tax exemptions in the importation or disposition of machinery. While the Convention was in session on September 21. under the law. art. 106. Note 28. (Dimagiba. 151 (1973)... 145 Amending Presidential Decree No. 137 Rep. as amended. 4. and the 1971 Convention began to perform its functions on June 1. 165 Ibid. sec. Decree No. 1973.. 152 Id. 387 (1949). the concessionaire and the service contractors are extracted certain taxes in favor of the government. 387 (1949). 169 Providing for A Modernized System of Administration and Disposition of Mineral Lands and to Promote and Encourage the Development and Exploitation thereof. In the concession system. of said body. at 1. sec. 1972. 161 The antecedents leading to the Proclamation are narrated in Javellana v. sec. inspect or audit the books of accounts of the contract holder. Act No. 141.25 (1972). 2. 94. Exploitation or Utilization of Lands of the Public Domain. sections 13C. sec. 4 (1993). 1969. On November 29. The concessionaire and the service contractor are required to keep in their files valuable data and information and may be required to submit need technological or accounting reports to the Government." 162 Bernas. S.24 and 13C. 157 Id. sec. 156 Pres. the Government merely receives fixed royalty which is a certain percentage of the crude oil produced or other units of measure. 136 Ibid. The share of the Government depends largely on the net proceeds of production after reimbursing the service contractor of its recoverable expenses. 1972. Decree No. the more amount or royalty would be allocated to the Government. As a general rule. art. at 1016. which was amended by Resolution No. discovery or production bonuses may be given by the developer to the host Government. at 6. the concessionaire may be discouraged to produce more for the reason that since the royalty paid to the host country is closely linked to the volume of production. quoting Sanvictores. 149 Pres. the President of the Philippines issued Presidential Decree No. 50 SCRA 55 (1973): On March 16. Under Republic Act No. and has thereby come into effect. 135 Id. Note 28. regardless of whether the concession holder makes profits or not. art. citing Session of November 25. Service Contracts in Philippine Natural Resources. materials and spare parts needed in petroleum operations. signature.. Corporations for the Exploration.. Development. sec.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 62 132 133 Rep. 95.

L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 63 171 172 Pres. Inc. 34. sec. 7160 otherwise known as the Local Government Code of 1991. sec. 207 208 Id. 196 An Act Reducing Excise Tax Rates on Metallic and Non-Metallic Minerals and Quarry Resources. Maximum Areas for Mineral Agreement.. and (3) For the exclusive economic area. sec. 389.. 179 Ibid. 3 (r). sec. 206 Id. v. 153 SCRA 602 (1987). Section 34. (c) Offshore. 3[f]. 26 (a). 213 Id. 7942 (1995). sec. sec. 184 Id.) 200 Id. Inc. or corporations. art. Adopting a Provisional Constitution. or corporations. 705 (1975). II. 222 Petitioners note in their Memorandum that the FTAA: . J. art. 3 (aq).—The Government share as referred to in the preceding sections shall be shared and allocated in accordance with Sections 290 and 292 of Republic Act No.) 3528-115 to 3528-117 (August 1987). cooperatives. sec. 26. 183 III Records of the Constitutional Commission 255. 187 Rep. supra. sec... 42. 81. The maximum areas mentioned above that a contractor may hold under a mineral agreement shall not include mining/quarry areas under operating agreements between the contractor and a claimowner/lessee/permittee/licensee entered into under Presidential Decree No. (80).. 240 SCRA 100 (1995). in any one province – (1) For individuals. which governs the maximum area for FTAAs provides: SEC. 3 (x).. sec. and (2) For partnerships. 205 Id. 26 (c). Inc. Separate Opinion. sec. De Leon v.. (Id.. a larger area to be determined by the Secretary. 3[v]). (b) Onshore. 220 83 O. sec.. 267 SCRA 408 (1997). 219 Const. Maximum Contract Area. supra. Act No... 209 Id. (2) For partnerships.... Decree No. two hundred (200) blocks. S. 82. or corporations. 27. 212 Id. at 6. ten (10) blocks. and Providing for an Orderly Transition to a Government under a New Constitution. associations. associations. 175 Magallona. 3[ad]. 704 (1975). and (2) For partnerships. 7942 (1995).. 33. 216 Section 1. 214 Kapatiran v. 180 Ibid. Act No. 202 Id. the sharing and allocation shall be in accordance with Sections 291 and 292 of the said Code. five hundred (500) blocks. 3 (t). cooperatives.) 193 "Contract area" means land or body water delineated for purposes of exploration. 198 Id. sec. In case the development and utilization of mineral resources is undertaken by a government-owned or -controlled corporation. 181 J... Id.G. Tan.O. 9. 62. sec. Bernas. sec. sec. sec. 178 Miners Association of the Philippines. 21. in the entire Philippines – (1) For individuals. amending for the purpose Section 151 (a) of the National Internal Revenue Code. – The maximum contract area that may be granted per qualified person. as amended. v.. 163 SCRA 371 (1988). sec.. development.. Revising Presidential Decree No. in the entire Philippines – (1) For individuals. sec. The Intent of the 1986 Constitution Writers 812 (1995). 26 (b). 292 as Section 18. or (c) Combinations of (a) and (b) provided that it shall not exceed the maximum limits for onshore and offshore areas. or utilization of the minerals found therein.. supra. 197 Rep. Chapter 5 (Operation and Effect of Laws). 463.. sec. – The maximum area that a qualified person may hold at any time under a mineral agreement shall be: (a) Onshore. Factoran. On the other hand. art. 28. Sec. 195 Id. sec. 186 Cruz v. 215 Providing for the Publication of Laws either in the Official Gazette or in a Newspaper of General Circulation in the Philippines as a Requirement for their Effectivity.J. No. 192 "Contractor" means a qualified person acting alone or in consortium who is a party to a mineral agreement or to a financial or technical assistance agreement. one hundred (100) blocks. subject to relinquishment shall be: (a) 1. (1986). Jr. supra. 3 (aq). 200 was subsequently incorporated in the Administrative Code of 1987 (Executive Order No. v. 211 The maximum areas in cases of mineral agreements are prescribed in Section 28 as follows: SEC. (Id.. 218 Manila Prince Hotel v. Decree No. E.. 1. at 355-356. 201 Ibid. 7942 (1995). otherwise known as The Forestry Reform Code of the Philippines. 177 Const. 182 Miners Association of the Philippines. sec. 33. (Suppl. Jr. 3 (ab) and 26. 204 Id. XVIII. (Id. sec. 185 Const. 176 Declaring a National Policy to Implement the Reforms Mandated by the People. Government Service Insurance System.000 meridional blocks offshore. Factoran. Puno. 188 SEC. 3. cooperatives. last par. 189 An Act Creating A People's Small-Scale Mining Program and for other purposes. 190 Rep. 173 Pres. Jr. secs. Act No. Secretary of Environment and Natural Resources. (b) 4. 221 Miners Association of the Philippines. 217 136 SCRA 27 (1985)..) 194 "Gross output" means the actual market value of minerals or mineral products from its mining area as defined in the National Internal Revenue Code (Id. Allocation of Government Share. sec. Protecting their Basic Rights. 191 Id. 3 (h).. 3[g]. 199 "Mineral resource" means any concentration of minerals/rocks with potential economic value. 27. twenty (20) blocks.. Book 1 (Sovereignty and General Administration). Factoran. associations. sec. 1. Esguerra. fifty (50) blocks. 210 Id. 174 An Act to Promote the Exploration and Development of Geothermal Resources. 203 Id. sec.000 meridional blocks onshore.

192 (1946). exploit. 240 Vera v. at 842. (Labitag. 254 Vide Note 241. 3 (aq).3]. 282 NY 382. (c) relinquishes control over portions thereof at their own choice [Section 4. Land Tenure Association. we omitted "exploitation" first of all because it is believed to be subsumed under "development" and secondly because it has a derogatory connotation. sec.. (Id. and makes reports during the exploration period [Section 5]. 77 Phil. Philippine Natural Resources: Some Problems and Perspectives 17 in II Draft Proposal of the 1986 U. in explaining the reasons for the deletion of the term "exploitation": MR. 255 Vide Note 231. improvements and replacements of new mining facilities within the area [Section 6].1] As a contractor it also has the "exclusive right to explore. sec. in the national interest.. supra. Long Beach. Handbook on the Construction and Interpretation of the Laws § 8.) 244 Id. The New Constitution of the Philippines Annotated 924-926 (1990). 243 The Chair of the Committee on National Economy and Patrimony. at 316-317. 226 Rollo.. modifications.. 580. 263 Id. 458-459. etc.3] Thus.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 64 x x x guarantees that wholly foreign owned [WMCP] entered into the FTAA in order to facilitate "the large scale exploration.... may allow such citizens… to enter into service contracts…. process and dispose of all mineral products and byproducts thereof that may be derived or produced from the Contract Area. 260 III Record of the Constitutional Commission 354. 236 Civil Liberties Union v. 227 Ibid. 245 Id. 259 Vide Note 238. development and commercial exploitation of mineral deposits that may be found to exist within the Contract area. 225 J. The concession regime of natural resources disposition should be discontinued." [Section 1. Executive Secretary. Law Constitution Project. supra. Instead the State shall enter into such arrangements and agreements like co-production. following the recommendation in the UP draft. sec. . Castro.. Emphasis supplied.. last par. 2 (b). in fact. Civil Service Commission. at 12. 266 Id. 569.. 252 Vide Note 230." [Section 3. Commission on Audit of the Province of Cebu v. p. 1990. sec.5]. 23. VILLEGAS. 231 V Record of the Constitutional Commission 844. (e) submits a Declaration of Mining Feasibility [Sections 5. it is divided into an "exploration and feasibility phase" [Section 3. The phrase that is contained here which we adopted from the UP draft is "60 percent of voting stock. v. (g) complies with the conditions for environmental protection and industrial safety. 247 Agabin. (Rollo. M." [Section 1.. 246 M. although it did not specify the form it should take: "The Batasang Pambansa. (f) during the development period. Avelino. 249 I Draft Proposal of the 1986 U. 20. 228 People v.P. at 841. joint ventures. We just had a long discussion with the members of the team from the UP Law Center who provided us a draft. 233 Id. first par. The 1973 Charter required similar legislative approval.P. 262 Rep. at 844. submits work programs. 23. C. 1987. 256 Dated July 28. 258 Peralta v.) Likewise. 253 Vide Note 238. (d) submits work programs. Nationalism and Its Subversion in the Constitution 5. 230 III Record of the Constitutional Commission 351-352. at 9-11. The question was posed before the Jamir amendment and subsequent proposals introducing other limitations. Magallona. Madam President.6]. Black. Comm. 371 SCRA 196 (2001). there were then no such laws is inaccurate. sec. 268 Id. 3 (q).2 (a)] and a "construction." (III Record of the Constitutional Commission 255. 325 (1991). 242 Resolution to Incorporate in the New Constitution an Article on National Economy and Patrimony. 257 Dated October 3.2]. among other things: (a) operates within a prescribed contract area [Section 4].. 229 Rollo. provides the reports and determines and executes expansions. p. at 15-16. The contract subsists for an initial term of twenty-five (25) years from the date of its effectivity [Section 3. Nolledo. Law Constitution Project 11-13. as shall bring about effective control and a larger share in the proceeds. 265 Id. 7942 (1995). 3 (j). Province of Cebu. determines the timetable. sec. 26 NE 2d 945.. 364 (1956)... 224 Ibid. 237 III Record of the Constitutional Commission 278. 241 J. alluded to it in the discussion on the capitalization requirement: MR.4 and 5. 115 Phil. Tuason & Co.1] and renewable for a further period of twenty-five years under the same terms and conditions upon application by private respondent [Section 3. 98 Phil. 232 Id. 657 (1962). 234 Id. 194 SCRA 317. incurs expenditures. harvest or production. sec. 3 (aq) and 56. at 358. Villegas' response that there was no requirement in the 1973 Constitution for a law to govern service contracts and that. cited in 16 Am Jur 2d Constitutional Law §79. 35 (m). 212 SCRA 425 (1992). it is this wholly foreign owned corporation that. 250 Id. Manantan. 267 Id. (b) opts to apply for a Mining Production Sharing Agreement [Section 4. Act No. secs.5]. 31 SCRA 413 (1970)." As previously noted. Labitag. 270 Id. however. 261 Salaysay v. at 17. 238 Id. sec. 264 Id. 239 III Record of the Constitutional Commission 358-359. laws authorizing service contracts were actually enacted by presidential decree. Professor Labitag also suggests that: x x x.) 251 Vide Note 147. VILLEGAS. at 16. 3 (az). 248 E. Inc. pp. 269 Id.] Thus.P.. development and production phase. posts the necessary bonds and makes representations and warranties to the government [Section 10. Law Constitution Project.) 223 H. 235 Vide Cherey v. utilize. 127 ALR 1210 (1940). in II Draft Proposal of the 1986 U.

its track record in mineral resource exploration. rules and regulations promulgated thereunder: Provided. [Emphasis supplied. 276 SEC. co-production agreement or financial or technical assistance agreement over the permit area. 273 Id. the contractor.. rules and regulations: Provided. the matter shall be submitted to the Secretary whose decision shall be final. (i) Preferential use of local goods and services to the maximum extent practicable. except for paymets for dispositions for its equity. 39. staging or storage areas and port facilities. 35 (h). sec. upon consultation with the contractor. new river beds. 35. That the exploration period covered by the exploration period of the mineral agreement or financial or technical assistance agreement. telephone or telegraph lines. which application shall be granted if the permittee meets the necessary qualifications and the terms and conditions of any such agreement: Provided. sec. (h) Work programs and minimum expenditures commitments. .L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 65 271 272 Id. further. sec. 281 SEC. construct or install on the mining areas or lands owned. further. and warranties shall be incorporated in the financial or technical assistance agreement.. Terms and Conditions. joint venture agreement. the conractor shall not raise any form of financing from domestic sources of funds. whether in Philippine or foreign currency. prior thereto.. tunnels. extendible for another two (2) years but subject to annual review by the Secretary in accordance with the implementing rules and regulations of this Act. holders of mining rights shall not be prevented from entry into private lands and concession areas by surface owners. dams and their normal flood and catchment areas. [Emphasis supplied. laws and decisions of courts shall not thereby be impaired: Provided. (l) The contractors shall furnish the Government records of geologic. sec.. upon payment of just compensation. The contractor shall perform reforestation work within his mining area in accordance with forestry laws. (c) Submission of proof of technical competence. That such amount shall be subject to changes as may be provided for in the rules and regulations of this Act. [Emphasis supplied. and details of technical personnel to undertake the operation. That the Government reserves the right to regulate and control the explosive accessories to ensure safe mining operations. a contractor may be granted a right to cut trees or timber within his mining area as may be necessary for his mining operations subject to forestry laws. That any damage done to the property of the surface owner. mills. 74. 23. 274 Id. Easement Rights. foreign investments in local enterprises which are qualified for repatriation. the timber concessionaire/permittee and the Forest Management Bureau of the Department: Provided. airports. 3 (y). and that book of accounts and records shall be open for inspection by the government. The permittee may apply for a mineral production sharing agreement. for conducting its mining operations for and in the contract area. 275 Id. SEC. or concessionaires when conducting mining operations therein: Provided.] SEC. Id. 76. rules and regulations promulgated thereunder: Provided. tailings ponds. 39. ditches. That if the land covered by the mining area is already covered by exiting timber concessions. the person authorized to conduct mining operation shall. That the Government reserves the right to regulate water rights and the reasonable and equitable distribution of water supply so as to prevent the monopoly of the use thereof. 3 (af). 278 Id. managerial and technical expertise and.] SEC. occupant. [Emphasis supplied.—x x x. — The following terms. occupied or leased by other persons. shall be entitled to enter and occupy said mining areas or lands. second par. and further. 279 280 Id. Rights and Obligations of the Permittee. when proper.—A contractor shall have water rights for mining operations upon approval of application with the appropriate government agency in accordance with existing water laws.—When mining areas are so situated that for purposes of more convenient mining operations it is necessary to build.. runways. 35 (g).. such infrastructure as roads. the volume of timber needed and the manner of cutting and removal thereof shall be determined by the mines regional director. (e) Representations and warranties that the contractor has or has access to all the financing. Timber Rights. 35 (e). cuts. (d) Representations and warranties that the applicant has all the qualifications and none of the disqualifications for entering into the agreement. sec. flumes. (f) Representations and warranties that. and utilization. the prevailing prices in and around the area where the mining operations are to be conducted. 72. with surety or sureties satisfactory to the regional director. or mills.—Subject to prior notification. warehouses.. subject to the relinquishment obligations. first par. tramways. 75. the technology required to promptly and effectively carry out the objectives of the agreement with the understanding to timely deploy these resources under its supervision pursuant to the periodic work programs and related budgets.—Any provision of the law to the contrary notwithstanding. (g) The mining operations shall be conducted in accordance with the provisions of this Act and its implementing rules and regulations. post a bond with the regional director based on the type of properties. recognized and acknowledged by local customs. [Emphasis supplied. sec. 35 (l). and other relevant data for its mining operations. (b) A financial guarantee bond shall be posted in favor of the Government in an amount equivalent to the expenditure obligation of the applicant for any year. conditions. pipelines. electric transmission. waste dump sites. or concessionaire as a consequence of such operations shall be properly compensated as may be bee provided for in the implementing rules and regulations: Provided.—A contractor/exploration permittee shall have the right to possess and use explosives within his contract/permit area as may be necessary for his mining operations upon approval of an application with the appropriate government agency in accordance with existing laws. such as. to wit: (a) A firm commitment in the form of a sworn statement. 73. That to guarantee such compensation. but not limited to. of an amount corresponding to the expenditure obligation that will be invested in the contract area: Provided.] SEC. further.] 277 Id. Right to Possess Explosives. details of technology to be employed in the proposed operation. rules and regulations. sec. occupants. canals. railroads. That in case of disagreement between the contractor and the timber concessionaire.. (k) Requiring the proponent to effectively use appropriate anti-pollution technology and facilities to protect the environment and to restore or rehabilitate mined out areas and other areas affected by mine tailings and other forms of pollution or destruction. providing an exploration period up to two (2) years. and local supplier's credits and such other generally accepted and permissible financial schemes for raising funds for valid business purposes. (j) A stipulation that the contractors are obligated to give preference to Filipinos in all types of mining employment for which they are qualified and that technology shall be transferred to the same. Entry into Private Lands and Concession Areas. That water rights already granted or vested through long use. development. accounting. sites for water wells. shafts. if circumstances demand.] SEC. Water Rights. sec.

duties and fees as provided for under existing laws. art III. In the case of a foreign contractor. 36.2. 294 Vide also WMCP FTAA. Option to Convert into a Mineral Agreement. — The maximum contract area that may be granted per qualified person. – As used in and for purposes of this Act. 305 Civil Liberties Union v.. after proper notice to the Secretary as provided for under the implementing rules and regulations. 243. (n) Provide for consultation and arbitration with respect to the interpretation and implementation of the terms and conditions of the agreements. art. 34. Maximum Contract Area.. — A financial or technical assistance agreement shall have a term not exceeding twenty-five (25) years to start from the execution thereof. whether in singular or plural. Withdrawal from Financial or Technical Assistance Agreement. Executive Secretary. special allowance. Negotiations. supra. Assignment/Transfer. That mining activities shall always be included in the investment priorities plan. Upon compliance with this requirement by the contractor. 40. Incentives. 81.2 (a). 303 Vide Note 223. 307 Ibid. 290 SEC. 291 SEC. That existing mineral agreements. sec. Inc. Term of Financial or Technical Assistance Agreement.. 10. 287 SEC. 10. pp.000 meridional blocks offshore. 563-564. 56. — The contractor has the option to convert the financial or technical assistance agreement to a mineral agreement at any time during the term of the agreement. excise tax.—A foreign owned/ -controlled corporation may be granted a mineral processing permit. 298 Id. inclusive.000 meridional blocks onshore. 292 SEC. 226. The President shall notify Congress of all financial or technical assistance agreements within thirty (30) days from execution and approval thereof. — A financial or technical assistance agreement may be assigned or transferred. 3. The Government share in financial or technical assistance agreement shall consist of. financial or technical assistance agreements and other mining rights are not impaired or prejudiced thereby. — The contractor shall manifest in writing to the Secretary his intention to withdraw from the agreement. That the mineral agreement shall only be for the remaining period of the original agreement. it shall be recorded with the appropriate government agency to give the proponent the prior right to the area covered by such proposal: Provided. 37. 295 WMCP. — All financial or technical assistance agreement proposals shall be filed with the Bureau after payment of the required processing fees. 10. 284 SEC. That the President shall notify Congress of every financial or technical assistance agreement assigned or converted in accordance with this provision within thirty (30) days from the date of the approval thereof. association. 8. Lingad. p. shall mean: xxx (g) "Contractor" means a qualified person acting alone or in consortium who is a party to a mineral agreement or to a financial or technical assistance agreement. or cooperative. 21 SCRA 496 (1967). — A financial or technical assistance agreement shall be negotiated by the Department and executed and approved by the President. to a qualified person subject to the prior approval of the President: Provided.1(c).—The contractors in mineral agreements. 283 SEC. That the contractor has complied or satisfied all his financial. 90. sec. 39. and financial or technical assistance agreements shall be entitled to the applicable fiscal and non-fiscal incentives as provided for under Executive Order No. Definition of Terms.. (b) 4. v. 293 Lidasan v. 38. That holders of exploration permits may register with the Board of Investments and be entitled to the fiscal incentives granted under the said Code for the duration of the permits or extensions thereof: Provided. 297 Id. sec. 296 Id. among other things. 289 SEC. Provided. 285 SEC. 6. Government Share in Other Mineral Agreements. The collection of Government share in financial or technical assistance agreement shall commence after the financial or technical assistance agreement contractor has fully recovered its pre-operating expenses. 299 Id. and development expenditures. sec. Commission on Elections. 282 SEC. 11. renewable for not more than twenty-five (25) years under such terms and conditions as may be provided by law. 288 SEC. sec. withholding tax due from the contractor's foreign stockholders arising from dividend or interest payments to the said foreign stockholder in case of a foreign national and all such other taxes. it shall reduce its equity to forty percent (40%) in the corporation.—x x x. 304 Rollo. partnership. The Secretary may accept the withdrawal: Provided. and (o) Such other terms and conditions consistent with the Constitution and with this Act as the Secretary may deem to be for the best interest of the State and the welfare of the Filipino people. the Secretary shall approve the conversion and execute the mineral productionsharing agreement. sec.1(a).4.. The Secretary shall recommend its approval to the President. If the proposal is found to be sufficient and meritorious in form and substance after evaluation. 300 Rollo. 306 Automotive Parts & Equipment Company. subject to relinquishment shall be: (a) 1. . the contractor's corporate income tax. 301 Civil Code. 1. in whole or in part. if the economic viability of the contract area is found to be inadequate to justify large-scale mining operations. 302 Const. Filing and Evaluation of Financial or Technical Assistance Agreement Proposals. 41. the following terms. Eligibility of Foreign-owned/-controlled Corporation. even after he has exerted reasonable diligence to remedy the cause or the situation. if in his judgment the mining project is no longer economically feasible. fiscal or legal obligations. exploration. otherwise known as the Omnibus Investments Code of 1987: Provided. 30 SCRA 248 (1969).L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 66 (m) Requiring the proponent to dispose of the minerals and byproducts produced under a financial or technical assistance agreement at the highest price and more advantageous terms and conditions as provided for under the rules and regulations of this Act. further. 286 SEC. or (c) Combinations of (a) and (b) provided that it shall not exceed the maximum limits for onshore and offshore areas. 10. sec.

4062. the latter. inalienable. Sp-24 in favor of defendant Sunbeam Convenience Foods. Banzon for petitioners.. d. the aforesaid Sales Patent was registered with the defendant Register of Deeds of Bataan who in turn issued Original Certificate of Title No. not the courts.401. hence. Sgs-2409. respondents. the correctness of its decision must be decided in the assumed truth and accuracy of the allegations of the complaint. The Republic of the Philippines should have exhausted all administrative remedies before filing the case in court. the Director of Lands caused the issuance of a Sales Patent in favor of defendant Sunbeam Convenience Foods. 1977 and filed a Notice of Appeal 5 dated October 25. 1977 . Finding that Lots I and 2 are alienable and disposable lands of the public domain under the jurisdiction of the Director of Lands despite clear and positive evidence to the contrary. The Court of Appeals gave due course to the petition for certiorari. Inc. 1976. 1963. petitioners. m (b) On May 3. Transfer Certificate of Title No. 1990 SUNBEAM CONVENIENCE FOODS INC. 2. (d) On May 11. CORAL BEACH DEVELOPMENT CORP.: In this petition for review on certiorari. 1977. the writ prayed for is granted. L-50464 January 29. while Transfer Certificate of Title No.. The Solicitor General then moved for an extension of thirty days within which to file the Record on Appeal and to pay the docket fee in order to perfect the appeal.. 4062 is set aside. for the two parcels of land above-described. 1963. Finally before this period of extension lapsed. the Solicitor General in the name of the Republic of the Philippines instituted before 2 the Court of First Instance of Bataan. Convenience Foods Corporation (hereafter simply SUNBEAM) and Coral Beach Development Corporation (hereafter simply CORAL BEACH) bring to our attention the decision rendered by the Court of Appeals in "Republic of the Philippines v. c. T-12421 was issued over Lot 1. 12422 was issued over Lot 2. and respondent judge is ordered to require private respondents to file their answer to the complaint in said Civil Case No.113. SARMIENTO. dismissing Civil Case No. 4062 and thereafter to proceed with the trial of the case on the merits and to render judgment thereon. having been initiated by the Solicitor General and not by the 3 Director of Lands. Finding that the complaint for reversion states no cause of action for alleged failure of petitioner to 6 exhaust administrative remedies. 1977.855 sq. Not finding that since the lower court acted in a Motion to Dismiss. Inc. SUNBEAM and CORAL BEACH filed a Motion to Dismiss on the following grounds: 1. m ) Lot 2-Sgs-2409 area 1. Original Certificate of Title No. The then Court of First Instance of Bataan dismissed the complaint in the Order of 4 October 7. instead of an appeal. . HON. Pedro 3.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 67 G. J. over the parcels of land both situated in Mariveles. adopting mainly the theory that since the titles sought to be cancelled emanated from the administrative act of the Bureau of Lands Director.. Hon." disposing as follows: WHEREFORE. Santiago. Sgs-2409.. resulting in the Court of Appeals granting the petitioner another extension of fifteen days from December 10. Bataan and more particularly described and bounded as follows: Lot 1-Sgs-2409 (area 3. set aside the Order of Dismissal rendered by the Court of First Instance in Civil Case No. Sp-24 was cancelled and in lieu thereof. both in favor of defendant Coral Beach Development Corporation I b. The title issued to SUNBEAM and CORAL BEACH had become indefeasible and imprescriptible. an action for reversion docketed as Civil Case No. The order of the respondent judge dated October 7. and ordered the presiding judge Hon. Pedro T. The complaint alleges that the lands in question are forest lands. 4062. et al. a petition for certiorari with the respondent Court of Appeals was filed. Concluding that the complaint for reversion is defective as it was not initiated by the Director of Lands. the Court of First Instance committed grave abuse of discretion in dismissing the complaint and in a. The action for reversion was defective. (c) Subsequently. According to the Solicitor General. 1977. This was to be followed by another motion for extension filed by the Solicitor General. had jurisdiction over the disposition of the land. and the REGISTER OF DEEDS OF BATAAN. COURT OF APPEALS and THE REPUBLIC OF THE PHILIPPINES. No.695 sq. Filoteo T. vs.R.' The following facts stated by the respondent Court in its decision and restated by the petitioners in their petition are accurate: (a) On April 29. The Solicitor General received the copy of the Order on October 11.

without tying the hands of the law or making it indifferent to realities. the rules of procedure must be observed so that the efficient administration of justice is ensured. If it is true that the lands are forest lands. An important factual issue raised in the complaint was the classification of the lands as forest lands. Considered extraordinary. Even rules on the confirmation of imperfect titles do not apply unless and until the land classified as forest land is released in an official proclamation to that effect so that it may form part of the 12 disposable agricultural lands of the public domain. the petition is DENIED and the decision of the Court of Appeals is affirmed. Thus. either before appeal was availed of or specially in instances where the appeal period has lapsed. The only way to resolve this question of fact as to the classification of the land is by remanding the case to the lower court for a full. Our adherence to the Regalian doctrine subjects all agricultural. or that the respondent Court has departed from the accepted and usual course of 18 judicial proceedings.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 68 T. Padilla and Regalado. then all these proceedings become moot and academic. In sum. or when the 17 questioned order amounts to an oppressive exercise of judicial authority. However. We find nothing disagreeable with the action of the Court of Appeals to give due course to the petition considering that the issue affected a matter of public concern which is the disposition of the lands of our matrimony No less than the Constitution protects its policy. JJ. Costs against the petitioners. before any land may be declassified from the forest group and converted into alienable or disposable land for agricultural or other purposes. Melencio-Herrera (Chairperson). A review is not a matter of right but of sound judicial discretion. This 9 material allegation stated in the Republic's complaint' was never denied specifically by the defendants (petitioners herein) SUNBEAM and CORAL BEACH. there must be a positive act from the government. not theretofore determined by the Supreme Court or has decided it in a way probably not in accord with law or the applicable decisions of the Supreme Court. or when the writs issued are null. The filing of the Motion to Dismiss the complaint for reversion by SUNBEAM and CORAL BEACH on the ground of lack of cause of action. The long line of decisions denying the petition for certiorari. Certiorari is one such remedy. no reversible error has been committed by the respondent court. the rules of procedure should be viewed as mere tools designed to facilitate the 14 attainment of justice. necessarily carried with it the admission. for purposes of the motion. WHEREFORE. Generally.dress trial on the issues involved. and (b) When the Court of Appeals has so far departed from the accepted and usual course of judicial 7 proceedings or so far sanctioned such departure by a lower court as to call for supervision . The few significant exceptions were: when public welfare and the advancement of public policy dictate. . in the absence of a clear showing that the Court of Appeals has decided a question of substance in a manner inconsistent with jurisprudence. far outnumbers the instances when certiorari was given due course. and mineral lands to the 11 dominion of the State. enumerates the premises for granting a review: (a) When the Court of Appeals has decided a question of substance. while neither controlling nor fully measuring the Court's discretion.. We therefore find no compelling reason to disturb the findings of the appellate court. nor any plain. Paras. They must lead to the proper and just determination of litigation. We agree with the Court of Appeals' granting of the petition filed by the Republic of the Philippines charging the then Court of First Instance with grave abuse of discretion. concur. Hence Sunbeam and Coral Beach filed this petition for review. SO ORDERED. of the truth of all material facts pleaded in the complaint instituted by the Republic. Santiago to receive the answers of the private respondents SUNBEAM and CORAL BEACH in the action for reversion. or 16 when the broader interests of justice so require. and is granted only when there are special and important reasons therefore. Land 10 remains unclassified land until it is released therefrom and rendered open to disposition. timber. speedy or adequate remedy in the ordinary course of the law. it is made available only when there is no 15 appeal. The following. The mere fact that a title was issued by the Director of Lands does not confer any validity on such title if 13 the property covered by the title or patent is part of the public forest.

Inc. 2. Inc. INC. Inc.67% equity in PHILSECO is PESOS: ONE BILLION THREE HUNDRED MILLION (P1. Japan (KAWASAKI) for the construction. vs.G. and/or its nominee. 1990. and the latter approves the same. 1997. Under the JVA.R. Thereafter. conserve. xxx xxx xxx 2. President Corazon C. interested bidders were given copies of the JVA between NIDC and KAWASAKI. NIDC transferred all its rights. Such interests were subsequently transferred to the National Government pursuant to Administrative Order No.942 shares of stock (representing 87. for reconsideration of our Resolution dated September 24. of Kobe. 2005 PNB. On December 8. 14. and/or [PHILYARDS] Holdings.1 APT reserves the right in its sole discretion. Inc. A portion of the ASBR reads: 1. 2003 and to elevate this case to the Court En Banc.0 The subject of this Asset Privatization Trust (APT) sale through public bidding is the National Government's equity in PHILSECO consisting of 896. No. entered into a Joint Venture Agreement (JVA) with Kawasaki Heavy Industries. title and interest in PHILSECO to the Philippine National Bank (PNB). ASSET PRIVATIZATION TRUST. RESOLUTION PUNO. xxx xxx xxx 6. After a series of negotiations between the APT and KAWASAKI.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 69 G. they agreed that the latter's right of first refusal under the JVA be "exchanged" for the right to top by five percent (5%) the highest bid for the said shares.869.0 The highest qualified bid will be submitted to the APT Board of Trustees at its regular meeting following the bidding. J. I. to reject any or all bids. Kawasaki Heavy Industries. which will be sold as a whole block in accordance with the rules herein enumerated. 1987. The petitioner questions the Resolution which reversed our Decision of November 20. the NIDC and KAWASAKI will contribute P330 million for the capitalization of PHILSECO in the proportion of 60%-40% respectively. 1993.: For resolution before this Court are two motions filed by the petitioner.41% thereby reducing KAWASAKI's shareholdings to 2. 1. Summit Holdings. that the highest bid is acceptable to the National Government. as well as the buyer.67% of PHILSECO's outstanding capital stock). In 1989.0 This public bidding shall be on an Indicative Price Bidding basis. 1986. On November 25. and PHILYARDS HOLDINGS. This provision shall not apply if the transferee is a corporation owned or controlled by the GOVERNMENT or by a KAWASAKI affiliate. are as follows: On January 27. [PHILYARDS] Holdings. 124293 January 31. Inc. 1993. a government corporation.. In the interest of the national economy and the government. SUMMIT HOLDINGS. 2000. and possession of. COURT OF APPEALS.000.. (PHI) would exercise its right to top.300. transfer or assign all or any part of its interest in SNS [PHILSECO] to any third party without giving the other under the same terms the right of first refusal.000.00). Aquino issued Proclamation No. and of the Asset Specific Bidding Rules (ASBR) drafted for the National Government's 87. KAWASAKI informed APT that Philyards Holdings.6% equity share in PHILSECO. a trust agreement was entered into between the National Government and the APT wherein the latter was named the trustee of the National Government's share in PHILSECO. Ltd. respondents. as set forth in our Resolution of September 24. 1986. They further agreed that KAWASAKI would be entitled to name a company in which it was a stockholder. The Indicative price set for the National Government's 87.59%. for the purpose of determining whether or not it should be endorsed by the APT Board of Trustees to the COP. Inc. J. on February 27. At the pre-bidding conference held on September 18. which in turn reversed and set aside a Decision of the Court of Appeals promulgated on July 18. its Chairman and Members. INC. 2003. assign or transfer its interest in the joint venture. The APT shall advise Kawasaki Heavy Industries. the National Government's shareholdings in PHILSECO increased to 97. as a result of a quasi-reorganization of PHILSECO to settle its huge obligations to 3. manage and dispose of non-performing assets of the National Government. shall be subject to the final approval of both the APT Board of Trustees and the Committee on Privatization (COP). The provisions of the ASBR were explained to the interested bidders who were notified that the bidding would be held on December 2. which could exercise the 1 right to top.. Inc.4 Neither party shall sell. shall then have a period of thirty (30) calendar days from the date of receipt of such advice from APT within which to J. 1995. petitioner. (SNS) which subsequently became the Philippine Shipyard and Engineering Corporation (PHILSECO). 50 establishing the Committee on Privatization (COP) and the Asset Privatization Trust (APT) to take title to. One of its salient features is the grant to the parties of the right of first refusal should either of them decide to sell.G.0 The highest bid. the COP and the APT deemed it best to sell the National Government's share in PHILSECO to private entities. Facts The undisputed facts of the case. COMMITTEE ON PRIVATIZATION. operation and management of the Subic National Shipyard. On September 7. the National Investment and Development Corporation (NIDC). viz: .

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exercise their "Option to Top the Highest Bid" by offering a bid equivalent to the highest bid plus five (5%) percent thereof. 6.1 Should Kawasaki Heavy Industries, Inc. and/or [PHILYARDS] Holdings, Inc. exercise their "Option to Top the Highest Bid," they shall so notify the APT about such exercise of their option and deposit with APT the amount equivalent to ten percent (10%) of the highest bid plus five percent (5%) thereof within the thirty (30)-day period mentioned in paragraph 6.0 above. APT will then serve notice upon Kawasaki Heavy Industries, Inc. and/or [PHILYARDS] Holdings, Inc. declaring them as the preferred bidder and they shall have a period of ninety (90) days from the receipt of the APT's notice within which to pay the balance of their bid price. 6.2 Should Kawasaki Heavy Industries, Inc. and/or [PHILYARDS] Holdings, Inc. fail to exercise their "Option to Top the Highest Bid" within the thirty (30)-day period, APT will declare the highest bidder as the winning bidder. xxx xxx xxx 12.0 The bidder shall be solely responsible for examining with appropriate care these rules, the official bid forms, including any addenda or amendments thereto issued during the bidding period. The bidder shall likewise be responsible for informing itself with respect to any and all conditions concerning the PHILSECO Shares which may, in any manner, affect the bidder's proposal. Failure on the part of the bidder to so examine and inform itself shall be its sole risk and no relief for error or omission will be given by APT or COP. . . . At the public bidding on the said date, petitioner J.G. Summit Holdings, Inc. submitted a bid of Two Billion and Thirty Million Pesos (P2,030,000,000.00) with an acknowledgment of KAWASAKI/[PHILYARDS'] right to top, viz: 4. I/We understand that the Committee on Privatization (COP) has up to thirty (30) days to act on APT's recommendation based on the result of this bidding. Should the COP approve the highest bid, APT shall advise Kawasaki Heavy Industries, Inc. and/or its nominee, [PHILYARDS] Holdings, Inc. that the highest bid is acceptable to the National Government. Kawasaki Heavy Industries, Inc. and/or [PHILYARDS] Holdings, Inc. shall then have a period of thirty (30) calendar days from the date of receipt of such advice from APT within which to exercise their "Option to Top the Highest Bid" by offering a bid equivalent to the highest bid plus five (5%) percent thereof. As petitioner was declared the highest bidder, the COP approved the sale on December 3, 1993 "subject to the right of Kawasaki Heavy Industries, Inc./[PHILYARDS] Holdings, Inc. to top JGSMI's bid by 5% as specified in the bidding rules."
2

On December 29, 1993, petitioner informed APT that it was protesting the offer of PHI to top its bid on the grounds that: (a) the KAWASAKI/PHI consortium composed of KAWASAKI, [PHILYARDS], Mitsui, Keppel, SM Group, ICTSI and Insular Life violated the ASBR because the last four (4) companies were the losing bidders thereby circumventing the law and prejudicing the weak winning bidder; (b) only KAWASAKI could exercise the right to top; (c) giving the same option to top to PHI constituted unwarranted benefit to a third party; (d) no right of first refusal can be exercised in a public bidding or auction sale; and (e) the JG Summit consortium was not estopped from questioning the proceedings. On February 2, 1994, petitioner was notified that PHI had fully paid the balance of the purchase price of the subject bidding. On February 7, 1994, the APT notified petitioner that PHI had exercised its option to top the highest bid and that the COP had approved the same on January 6, 1994. On February 24, 1994, the APT and PHI executed a Stock Purchase Agreement. Consequently, petitioner filed with this Court a Petition for Mandamus under G.R. No. 114057. On May 11, 1994, said petition was referred to the Court of Appeals. On July 18, 1995, the Court of Appeals denied the same for lack of merit. It ruled that the petition for mandamus was not the proper remedy to question the constitutionality or legality of the right of first refusal and the right to top that was exercised by KAWASAKI/PHI, and that the matter must be brought "by the proper party in the proper forum at the proper time and threshed out in a full blown trial." The Court of Appeals further ruled that the right of first refusal and the right to top are prima facie legal and that the petitioner, "by participating in the public bidding, with full knowledge of the right to top granted to KAWASAKI/*PHILYARDS+ is…estopped from questioning the validity of the award given to [PHILYARDS] after the latter exercised the right to top and had paid in full the purchase price of the subject shares, pursuant to the ASBR." Petitioner filed a Motion for Reconsideration of said Decision which was denied on March 15, 1996. Petitioner thus filed a Petition for Certiorari with this Court alleging grave abuse of discretion on the part of the appellate court. On November 20, 2000, this Court rendered x x x [a] Decision ruling among others that the Court of Appeals erred when it dismissed the petition on the sole ground of the impropriety of the special civil action of mandamus because the petition was also one of certiorari. It further ruled that a shipyard like PHILSECO is a public utility whose capitalization must be sixty percent (60%) Filipino-owned. Consequently, the right to top granted to KAWASAKI under the Asset Specific Bidding Rules (ASBR) drafted for the sale of the 87.67% equity of the National Government in PHILSECO is illegal — not only because it violates the rules on competitive bidding — but more so, because it allows foreign corporations to own more than 40% equity in the shipyard. It also held that "although the petitioner had the opportunity to examine the ASBR before it participated in the bidding, it cannot be estopped from questioning the unconstitutional, illegal and inequitable provisions thereof." Thus, this Court voided the transfer of the national government's 87.67% share in PHILSECO to Philyard[s] Holdings, Inc., and upheld the right of JG Summit, as the highest bidder, to take title to the said shares, viz: WHEREFORE, the instant petition for review on certiorari is GRANTED. The assailed Decision and Resolution of the Court of Appeals are REVERSED and SET ASIDE. Petitioner is ordered to pay to APT its bid price of Two Billion Thirty Million Pesos (P2,030,000,000.00), less its bid deposit plus interests upon the finality of this Decision. In turn, APT is ordered to:

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(a) accept the said amount of P2,030,000,000.00 less bid deposit and interests from petitioner; (b) execute a Stock Purchase Agreement with petitioner; Motion to Elevate this Case to the (c) cause the issuance in favor of petitioner of the certificates of stocks representing 87.6% of PHILSECO's total capitalization; (d) return to private respondent PHGI the amount of Two Billion One Hundred Thirty-One Million Five Hundred Thousand Pesos (P2,131,500,000.00); and (e) cause the cancellation of the stock certificates issued to PHI. SO ORDERED. In separate Motions for Reconsideration, respondents submit[ted] three basic issues for x x x resolution: (1) Whether PHILSECO is a public utility; (2) Whether under the 1977 JVA, KAWASAKI can exercise its right of first refusal only up to 40% of the total capitalization of PHILSECO; and (3) Whether the right to top 3 granted to KAWASAKI violates the principles of competitive bidding. (citations omitted) In a Resolution dated September 24, 2003, this Court ruled in favor of the respondents. On the first issue, we held that Philippine Shipyard and Engineering Corporation (PHILSECO) is not a public utility, as by 4 5 nature, a shipyard is not a public utility and that no law declares a shipyard to be a public utility. On the second issue, we found nothing in the 1977 Joint Venture Agreement (JVA) which prevents Kawasaki Heavy Industries, Ltd. of Kobe, Japan (KAWASAKI) from acquiring more than 40% of PHILSECO’s total 6 capitalization. On the final issue, we held that the right to top granted to KAWASAKI in exchange for its 7 right of first refusal did not violate the principles of competitive bidding. On October 20, 2003, the petitioner filed a Motion for Reconsideration and a Motion to Elevate This Case 9 to the Court En Banc. Public respondents Committee on Privatization (COP) and Asset Privatization Trust (APT), and private respondent Philyards Holdings, Inc. (PHILYARDS) filed their Comments on J.G. Summit Holdings, Inc.’s (JG Summit’s) Motion for Reconsideration and Motion to Elevate This Case to the Court En Banc on January 29, 2004 and February 3, 2004, respectively. II. Issues Based on the foregoing, the relevant issues to resolve to end this litigation are the following: 1. Whether there are sufficient bases to elevate the case at bar to the Court en banc.
8

2. Whether the motion for reconsideration raises any new matter or cogent reason to warrant a reconsideration of this Court’s Resolution of September 24, 2003.

Court En Banc The petitioner prays for the elevation of the case to the Court en banc on the following grounds: 1. The main issue of the propriety of the bidding process involved in the present case has been confused with the policy issue of the supposed fate of the shipping industry which has never 10 been an issue that is determinative of this case. 2. The present case may be considered under the Supreme Court Resolution dated February 23, 1984 which included among en banc cases those involving a novel question of law and those where a doctrine or principle laid down by the Court en banc or in division may be modified or 11 reversed. 3. There was clear executive interference in the judicial functions of the Court when the Honorable Jose Isidro Camacho, Secretary of Finance, forwarded to Chief Justice Davide, a memorandum dated November 5, 2001, attaching a copy of the Foreign Chambers Report dated October 17, 2001, which matter was placed in the agenda of the Court and noted by it in a formal 12 resolution dated November 28, 2001. Opposing J.G. Summit’s motion to elevate the case en banc, PHILYARDS points out the petitioner’s inconsistency in previously opposing PHILYARDS’ Motion to Refer the Case to the Court En Banc. PHILYARDS contends that J.G. Summit should now be estopped from asking that the case be referred to the Court en banc. PHILYARDS further contends that the Supreme Court en banc is not an appellate court to which decisions or resolutions of its divisions may be appealed citing Supreme Court 13 Circular No. 2-89 dated February 7, 1989. PHILYARDS also alleges that there is no novel question of law involved in the present case as the assailed Resolution was based on well-settled jurisprudence. Likewise, PHILYARDS stresses that the Resolution was merely an outcome of the motions for reconsideration filed by it and the COP and APT and is "consistent with t he inherent power of courts to ‘amend and control its 14 process and orders so as to make them conformable to law and justice.’ (Rule 135, sec. 5)" Private respondent belittles the petitioner’s allegations regarding the change in ponente and the alleged executive interference as shown by former Secretary of Finance Jose Isidro Camacho’s memorandum dated November 5, 2001 arguing that these do not justify a referral of the present case to the Court en banc. In insisting that its Motion to Elevate This Case to the Court En Banc should be granted, J.G. Summit further argued that: its Opposition to the Office of the Solicitor General’s Motion to Refer is different from

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its own Motion to Elevate; different grounds are invoked by the two motions; there was unwarranted "executive interference"; and the change in ponente is merely noted in asserting that this case should be 15 decided by the Court en banc. We find no merit in petitioner’s contention that the propriety of the bidding process involved in the present case has been confused with the policy issue of the fate of the shipping industry which, petitioner maintains, has never been an issue that is determinative of this case. The Court’s Resolution of September 24, 2003 reveals a clear and definitive ruling on the propriety of the bidding process. In discussing whether the right to top granted to KAWASAKI in exchange for its right of first refusal violates the principles of competitive bidding, we made an exhaustive discourse on the rules and principles of public 16 bidding and whether they were complied with in the case at bar. This Court categorically ruled on the petitioner’s argument that PHILSECO, as a shipyard, is a public utility which should maintain a 60% -40% Filipino-foreign equity ratio, as it was a pivotal issue. In doing so, we recognized the impact of our ruling 17 on the shipbuilding industry which was beyond avoidance. We reject petitioner’s argument that the present case may be considered under the Supreme Court Resolution dated February 23, 1984 which included among en banc cases those involving a novel question of law and those where a doctrine or principle laid down by the court en banc or in division may be modified or reversed. The case was resolved based on basic principles of the right of first refusal in commercial law and estoppel in civil law. Contractual obligations arising from rights of first refusal are not 18 new in this jurisdiction and have been recognized in numerous cases. Estoppel is too known a civil law concept to require an elongated discussion. Fundamental principles on public bidding were likewise used to resolve the issues raised by the petitioner. To be sure, petitioner leans on the right to top in a public bidding in arguing that the case at bar involves a novel issue. We are not swayed. The right to top was merely a condition or a reservation made in the bidding rules which was fully disclosed to all bidding 19 parties. In Bureau Veritas, represented by Theodor H. Hunermann v. Office of the President, et al ., we dealt with this conditionality, viz: x x x It must be stressed, as held in the case of A.C. Esguerra & Sons v. Aytona, et al., (L-18751, 28 April 1962, 4 SCRA 1245), that in an "invitation to bid, there is a condition imposed upon the bidders to the effect that the bidding shall be subject to the right of the government to reject any and all bids subject to its discretion. In the case at bar, the government has made its choice and unless an unfairness or injustice is shown, the losing bidders have no cause to complain nor right to dispute that choice. This is a well-settled doctrine in this jurisdiction and elsewhere." The discretion to accept or reject a bid and award contracts is vested in the Government agencies entrusted with that function. The discretion given to the authorities on this matter is of such wide latitude that the Courts will not interfere therewith, unless it is apparent that it is used as a shield to a fraudulent award (Jalandoni v. NARRA, 108 Phil. 486 [1960]). x x x The exercise of this discretion is a policy decision that necessitates prior inquiry, investigation, comparison, evaluation, and deliberation. This task can best be discharged by the Government agencies concerned, not by the Courts. The role of the Courts is to ascertain whether a branch or instrumentality of the Government has transgressed its constitutional boundaries. But the Courts will not interfere with executive or legislative discretion exercised within those boundaries. Otherwise, it strays into the realm of policy decision-making. It is only upon a clear showing of grave abuse of discretion that the Courts will set aside the award of a contract made by a government entity. Grave abuse of discretion implies a capricious, arbitrary and whimsical exercise of power (Filinvest Credit Corp. v. Intermediate Appellate Court, No. 65935, 30 September 1988, 166 SCRA 155). The abuse of discretion must be so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform a duty enjoined by law, as to act at all in contemplation of law, where the power is exercised in an arbitrary and despotic manner by reason of passion or hostility (Litton Mills, Inc. v. Galleon Trader, Inc., et al[.], L-40867, 26 July 1988, 163 SCRA 489). The facts in this case do not indicate any such grave abuse of discretion on the part of public respondents when they awarded the CISS contract to Respondent SGS. In the "Invitation to Prequalify and Bid" (Annex "C," supra), the CISS Committee made an express reservation of the right of the Government to "reject any or all bids or any part thereof or waive any defects contained thereon and accept an offer most advantageous to the Government." It is a well-settled rule that where such reservation is made in an Invitation to Bid, the highest or lowest bidder, as the case may be, is not entitled to an award as a matter of right (C & C Commercial Corp. v. Menor, L-28360, 27 January 1983, 120 SCRA 112). Even the lowest Bid or any Bid may be rejected or, in the exercise of sound discretion, the award may be made to another than the lowest bidder (A.C. Esguerra & Sons v. Aytona, supra, citing 43 Am. Jur., 788). (emphases supplied)1awphi1.nét Like the condition in the Bureau Veritas case, the right to top was a condition imposed by the government in the bidding rules which was made known to all parties. It was a condition imposed on all bidders equally, based on the APT’s exercise of its discretion in deciding on how best to privatize the government’s shares in PHILSECO. It was not a whimsical or arbitrary condition plucked from the ether and inserted in the bidding rules but a condition which the APT approved as the best way the government could comply with its contractual obligations to KAWASAKI under the JVA and its mandate of getting the most advantageous deal for the government. The right to top had its history in the mutual right of first refusal in the JVA and was reached by agreement of the government and KAWASAKI. Further, there is no "executive interference" in the functions of this Court by the mere filing of a memorandum by Secretary of Finance Jose Isidro Camacho. The memorandum was merely "noted" to acknowledge its filing. It had no further legal significance. Notably too, the assailed Resolution dated September 24, 2003 was decided unanimously by the Special First Division in favor of the respondents . Again, we emphasize that a decision or resolution of a Division is that of the Supreme Court and the 21 Court en banc is not an appellate court to which decisions or resolutions of a Division may be appealed. For all the foregoing reasons, we find no basis to elevate this case to the Court en banc.
20

59%) did not translate to a 31 deprivation or loss of its contractually granted right of first refusal. b. The bidders*’+ right to top was actually exercised by losing bidders. 3. the bidding was valid because PHILYARDS exercised the right to top and it was of no moment that losing bidders later joined PHILYARDS 32 in raising the purchase price. PHILYARDS stresses that KAWASAKI’s right of first refusal or 27 even the right to top is not limited to the 40% equity of the latter. c.G. As regards the right of first refusal. The landholding issue does not pose questions of fact. PHILYARDS opines that landholding by PHILSECO at the time of the bidding is irrelevant because what is essential is that ultimately a qualified entity would eventually hold PHILSECO’s real estate 28 properties. PHILYARDS denies that the Decision is based mainly on policy considerations and points out that it is premised on principles governing obligations and contracts and corporate law such as the rule requiring respect for contractual stipulations. would not affect the right of first refusal itself. 2004. On the other hand. which is contrary to law and the constitution is null and void for being violative of substantive due process and the abuse of right provision in the Civil Code. upholding rights of first refusal. The conversion of the right of first refusal into a right to top by 5% does not violate any provision in the JVA between NIDC and KAWASAKI. Summit. a.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 73 Motion for Reconsideration Three principal arguments were raised in the petitioner’s Motion for Reconsideration. On the landholding issue raised by J. PHILSECO no longer owns real property.G. The award by the APT of 87. PHILYARDS emphasizes that this is a non-issue and even involves a question of fact. In a Consolidated Comment dated March 8. PHILSECO is not a public utility and therefore not governed by the constitutional restriction on foreign ownership. Petitioner’s motion to elevate the case to the Court en banc is baseless and would only delay 33 the termination of this case. and recognizing the assignable nature of contracts 26 rights. 6. Whether a shipyard is a public utility is not the core issue in this case. 1. J. a. Also. That PHILSECO owned land at the time that the right of first refusal was agreed upon and at the time of the bidding are most relevant. 4. 2. any applicable nationality restrictions. Summit’s allegations of fact regarding PHILSECO’s landholding. given the assignable nature of the right of first refusal. but only the 29 manner of its exercise. that neither the right of first refusal nor the right to top can be legally exercised by the consortium which is not the proper party 23 granted such right under either the JVA or the Asset Specific Bidding Rules (ASBR). The right to top or the right of first refusal cannot co-exist with a genuine competitive bidding. it must also recognize PHILYARDS’ assertions that 30 PHILSECO’s landholdings were sold to another corporation.G. 2. The landholding issue is not a non-issue. Third. Summit has not been able to show 25 compelling reasons to warrant a reconsideration of the Decision of the Court. including landholding limitations. the ruling that shipyards are not public utilities relies on established case law and fundamental rules of statutory construction. Even assuming that this Court can take cognizance of such question of fact even without the benefit of a trial. PHILYARDS argues that if this Court takes cognizance of J. The right to top was exercised by PHILYARDS as the nominee of KAWASAKI and the fact that PHILYARDS formed a consortium to raise the required amount to exercise the right to top the highest bid by 5% does not violate the JVA or the ASBR. that the maintenance of the 60%-40% relationship between the National Investment and Development Corporation (NIDC) and KAWASAKI arises from contract and from the Constitution because PHILSECO is a landholding corporation and need not be a public utility to be bound by the 60%-40% constitutional 24 limitation. public respondents COP and APT contend: b. c. First. Also. not on policy considerations. Summit countered the arguments of the public and private respondents in this wise: 1.67% shares of PHILSECO to PHILYARDS with losing bidders through the exercise of a right to top. Second. The 60%-40% Filipino-foreign constitutional requirement for the acquisition of lands does not apply to PHILSECO because as admitted by petitioner itself. 5. Further. private respondent explains that KAWASAKI’s reduced shareholdings (from 40% to 2. The benefits derived from the right to top were unwarranted. In cadence with the private respondent PHILYARDS. Also.G. The landholding issue has been a legitimate issue since the start of this case but is shamelessly ignored by the respondents. the contracts do not 22 authorize the right to top to be derived from the right of first refusal. private respondent PHILYARDS asserts that J. . that a fair resolution of the case should be based on contract law. The petitioner is legally estopped from assailing the validity of the proceedings of the public bidding as it voluntarily submitted itself to the terms of the ASBR which included the provision on the right to top. d.

indeed. The history behind the birth of the right to top shows fraud and bad faith. If the land is retained. could be assigned to a qualified party. the formation by [PHILYARDS] of a consortium is legitimate in a free enterprise system. the government would have to take utmost precaution to protect public interest by ensuring that the parties with which it is contracting have the ability to satisfactorily construct or operate the infrastructure. Estoppel is unavailing as it would stamp validity to an act that is prohibited by law or against public policy.131 billion necessary in exercising the right to top is not contrary to law. It contends. the persons with whom PHILYARDS desired to enter into business with in order to raise funds to purchase the shares are basically its business. however. that the participation of the losing bidders in the public bidding was done with fraudulent intent. nothing new and of significance in the petitioner’s pleading warrants a reconsideration of our ruling. could not subsequently be converted into the right to top. In such cases. then there is no 40 violation of the Constitution. Thus. First of all. In the alternative. This is in contrast to a case involving a contract for the operation of or construction of a government infrastructure where the identity of the buyer/bidder or financier constitutes an important consideration. c. In the case at bar. In sum. it would seem that questions of fact beyond cognizance by this Court were involved in the issue. absent proof of any fraudulent intent. by itself.e. b. As such. The 10% bid deposit was placed in escrow. nothing in the JVA or ASBR bars the conversion of the right of first refusal to the right to top. respondents assert that since the right of first refusal was validly converted into a right to top. under the terms of their JVA. On the landholding issue.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 74 3. Keppel Consortium (composed of Keppel. by itself. we see no inherent illegality on PHILYARDS’ act in seeking funding from parties who were losing bidders. However. the right of first refusal can be validly assigned to a qualified Filipino entity in order to maintain the 60%-40% ratio. We upheld the mutual 34 right of first refusal in the JVA. We uphold the validity of the mutual rights of first refusal under the JVA between KAWASAKI and NIDC. PHILYARDS admits that it may have previously held land but had already 39 divested such landholdings. The right of first refusal was. at present. KAWASAKI could exercise its right of first refusal only up to 40% of the shares of PHILSECO due to the constitutional prohibition on landholding by corporations with more than 40% foreign-owned equity. This right allows them to purchase the shares of their co-shareholder before they are offered to a third party. the right of first refusal over shares pertains to the . Mitsui and ICTSI). Summit’s insistence that the right to top cannot be sourced from the right of first refusal is not new and we have already ruled on the issue in our Resolution of September 24. in exercising its right of first refusal. Likewise. but by PHILYARDS which is a Filipino corporation (i. In this vein. This transfer. The agreement of co-shareholders to mutually grant this right to each other.G. can exceed 40% of PHILSECO’s equity. being a property right. the right of first refusal. "effectively useless. public policy or public morals. to raise the purchase price. Further. Alternatively. Petitioner is not legally estopped to challenge the right to top in this case. SM Group. a. it is not the foreign stockholde rs’ ownership of the shares which is adversely affected but the capacity of the corporation to own land – that is. As PHILYARDS correctly puts it. PHILSECO may divest of its landholdings. a. the records show that PHILYARDS admits it had owned land 41 up until the time of the bidding. Likewise. The appellate court is thus correct in holding the petitioner estopped from questioning the validity of the transfer of the National 36 Government's shares in PHILSECO to respondent. This is a purely commercial decision over which the State should not interfere absent any legal infirmity. Fraud and bad faith attend the alleged conversion of an inexistent right of first refusal to the right to top. nor was it shown by competent evidence. we held: The fact that the losing bidder. We also ruled that nothing in the JVA prevents KAWASAKI from acquiring 35 more than 40% of PHILSECO’s total capitalization. the right of first refusal was inutile and 37 as such. It further argues that since KAWASAKI already held at least 40% equity in PHILSECO. this would not affect the right of first refusal but only the exercise thereof. we already disposed of the argument that neither the right of first refusal nor the right to top can legally be exercised by the consortium which is not the proper party granted such right under either the JVA or the ASBR. The transfer could be made either to a nominee or such other party which the holder of the right of first refusal feels it can comfortably do business with. it can even be said that if the foreign shareholdings of a landholding corporation exceeds 40%. 60% of its shares are owned by Filipinos). This finds support under the basic corporate law principle that the corporation and its stockholders are separate juridical entities. 2003. KAWASAKI and NIDC. the right of first refusal is a property right of PHILSECO shareholders. The petitioner did not allege. In fact. the only issue is whether KAWASAKI had a valid right of first refusal over PHILSECO shares under the JVA considering that PHILSECO owned land until the time of the bidding and KAWASAKI already held 40% of PHILSECO’s equity. Hence. the corporation becomes disqualified to own land. It is emphasized that the case at bar involves the disposition of shares in a corporation which the government sought to privatize. There is nothing in the ASBR that bars the losing bidders from joining either the winning bidder (should the right to top is not exercised) or KAWASAKI/PHI (should it exercise its right to top as it did). in which case KAWASAKI. J." 4. PHILSECO continues to violate the constitutional provision on landholdings as its shares are more 38 than 40% foreign-owned. Absent any proof of fraud.. J. At first. Deception was patent.G. if PHILSECO still owns land. which was exercised not by KAWASAKI. the right to top was an attractive nuisance. does not amount to a violation of the Anti-Dummy Laws. Petitioner also asserts that. that even if PHILSECO owned land. the land could be divested before the exercise of the right of first refusal. b. does not constitute a violation of the provisions of the Constitution limiting land ownership to Filipinos and Filipino corporations. has joined PHILYARDS in the latter's effort to raise P2. Summit submits that since PHILSECO is a landholding company. Insular Life Assurance.

As this Court said in Krivenko vs. donating. or industrial uses other than the development of water power. So is an option giving an alien the right to buy real property on condition that he is granted Philippine citizenship. the case at bar involves a right of first refusal over shares of stockwhile the Lui She case involves an option to buy the land itself. And yet this is just exactly what the parties in this case did within this pace of one year. As discussed earlier. J. With the exception of agricultural lands. Lui She. or associations qualified to acquire or hold lands of the public 42 domain. The right of first refusal granted to KAWASAKI. It is just as if today the possession is transferred. then the Constitutional ban against alien landholding in the Philippines. The State may directly undertake such activities. As such. Register of Deeds. they may be granted temporary rights such as a lease contract which is not forbidden by the Constitution. the veracity of which would require introduction of evidence. Summit alleges that PHILSECO continues to violate the Constitution as its foreign equity is above 40% and yet owns long-term leasehold rights which are 45 real rights. the right to top. these are questions of fact. the Court cannot resolve the questions they pose. The contract in Lui She prohibited the owner of the land from selling. sourced from the right of first refusal. is 43 similarly void. No law disqualifies a person from purchasing shares in a landholding corporation even if the latter will exceed the allowed foreign equity. provided: "Save in cases of hereditary succession. however. flora and fauna. and utilization of natural resources shall be under the full control and supervision of the State. no private lands shall be transferred or conveyed except to individuals. Filipino citizenship is not impossible to acquire. and other mineral oils. the option to buy was invalidated because it amounted to a virtual transfer of ownership as the owner could not sell or dispose of his properties. and under such terms and conditions as may be provided by law. but also an option to buy. wildlife.G. or production-sharing agreements with Filipino citizens. The Court needs to validate these factual allegations based on competent and reliable evidence. and this violates the Constitution x x x The violation continues to this day because under the law. (emphases supplied) The petitioner further argues that "an option to buy land is void in itself (Philippine Banking Corporation v. Article XIV of the 1973 Constitution (the JVA was signed in 1977). is also void. all other natural resources shall not be alienated. (emphases supplied. Section 14. fisheries. the disposition. development. If this can be done. and so on. or encumbering the property during the 50-year period of the option to buy. a piece of land. xxx xxx xxx Section 7. the use. Second. by virtue of which the Filipino owner cannot sell or otherwise dispose of his property. a lease to an alien for a reasonable period is valid. This is not so in the case at bar where the mutual right of first refusal in favor of NIDC and KAWASAKI does not amount to a virtual transfer of land to a non-Filipino. Hence. All lands of the public domain. what the law disqualifies is the corporation from owning land .L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 75 shareholders whereas the capacity to own land pertains to the corporation. The exploration. until ultimately all the rights of which ownership is made up are consolidated in an alien." . as announced in Krivenko 44 vs. and other natural resources are owned by the State. It cites Article 415 of the Civil Code which includes in the definition of immovable property. 46 "contracts for public works. forests or timber. with the result that Justina Santos'[s] ownership of her property was reduced to a hollow concept. a Japanese corporation. joint venture. renewable for not more than twentyfive years. fisheries. minerals. Register of Deeds: [A]liens are not completely excluded by the Constitution from the use of lands for residential purposes. is indeed in grave peril.2 Petitioner has consistently pointed out in the past that private respondent is not a 60%-40% corporation. petroleum. the next day. jus utendi. coal. Since their residence in the Philippines is temporary." for we ruled as follows: x x x To be sure." Any existing 47 landholding. or corporations or associations at least sixty per centum of whose capital is owned by such citizens. In cases of water rights for irrigation. We note that in its Motion for Reconsideration. all forces of potential energy. or associations qualified to acquire or hold lands of the public domain. this to last for 50 years. This is the clear import of the following provisions in the Constitution: Section 2. 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." Contrary to the contention of petitioner. First. To review the constitutional provisions involved. Such agreements may be for a period not exceeding twenty-five years. Should they desire to remain here forever and share our fortunes and misfortunes. But if an alien is given not only a lease of. the case of Lui She did not that say "an option to buy land is void in itself. waters. water supply. corporations. Citations omitted) In Lui She. In fact. corporations.G. Summit misreads the provisions of the Constitution cited in its own pleadings. 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. mortgaging. there is a distinction between the shareholder’s ownership of shares and the corporation’s ownership of land arising from the separate juridical personalities of the corporation and its shareholders. to wit: 29. J. it continues to own real property… xxx xxx xxx 32. is denied by PHILYARDS citing its recent financial statements. Hence. beneficial use may be the measure and limit of the grant. and servitudes and other real rights over immovable property. tomorrow. 21 SCRA 52 [1967]). the fact that PHILSECO owns land cannot deprive stockholders of their right of first refusal. or it may enter into co-production. Save in cases of hereditary succession. no private lands shall be transferred or conveyed except to individuals.

The Motion to Elevate This Case to the Court En Banc is likewise DENIED for lack of merit. 23-24. p. 40 PHILYARDS’ Comment dated February 3. 2002. 2004. p. 1975.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 76 32. Rollo. Rollo. p. 2004.G. Dy Buncio & Co. pp. 10-22. Summit’s Motion to Elevate this Case to the Court En Banc dated October 17. 2003." Also referred to as J G Summit. 2003. decline to take cognizance of the same. 27 Id. 268 SCRA 727 (1997). pp. Rollo. at 14. 1982. (Chairman). 12 Id. 1854. 2-89. 7 Id. and Guzman. 8-9. 415(2). at 10-13. Rollo. Article XII of the 1987 Constitution. 30 Id. Ynares-Santiago. 2004. 18 See Bastida and Ysmael & Co. at 15. p. Polytechnic University of the Philippines v. Burgos . 3.G. p. 101678. 2004. No motion for reconsideration of the action of the Court en banc declining to take cognizance of a referral by a Division. Summit’s Consolidated Comment dated March 8. No. pp.R. pp. Sadhwani v. Rollo. p. p. Rollo.G. 1979. pp. 2002. A decision or resolution of a Division of the Court. 4 Id. JJ. 26-27.1 This provision is the same as Section 7. No. 3 Resolution promulgated on September 24. as amended). Rollo. Footnotes 1 2 Also referred to in this Resolution as "PHILYARDS. 1971. at 13-19. 1861-1862. pp. 10. 38 Id. CA . p. 2112. 1334. A resolution of the Division denying a party’s motion for referral to the Court en banc of any Division case. 1978-1986.. 14 PHILYARDS’ Comment dated February 3. 32. 5 Id. 1. Rollo. pp. 42 Constitution. 39 PHILYARDS’ Manifestation and Comment dated June 26. at 26 – 32. and in no case without the concurrence of at least three of such Members. 35 Id. 43 J. Constitution. at 2.. 2004. in view of the foregoing. plants and growing fruit attached to the land would be limited to Filipinos and Filipino corporations only. 48 COP and APT’s Comment dated January 14.G. pp. Parañaque Kings Enterprises. 1989. 37 J. pp. the latter may. 2003. 2003. 2002. at 9. (emphases supplied) As correctly observed by the public respondents. 2003. pp. pp. at 5. 17. Commonwealth Act 141. 26 Id. 22. 1863-1866. 21 SCRA 52. 1868.. pp. is a decision or resolution of the Supreme Court (Section 4[3]. Davide. 28 Id. 14. v. 2109. SO ORDERED. 10 J. 22 J. p. 13 2. xxx xxx xxx 5. corporations qualified to acquire or hold lands of the public domain are corporations at least 60% of which is owned by Filipino citizens (Sec. 19 G.Otherwise. p. . Article VIII. Lui She. 368 SCRA 691 (2001). p. at 10 – 13. 291 SCRA 546 (1998). 15 J. 1334. 26-32. 1992. p. Rollo. pp. p.. 2 – 10. v. p. 11 Id. 1334. 34 Resolution dated September 24. 6 Id. 93 Phil. CA . Bonnevie.G. we would have a strange situation where the ownership of immovable property 49 such as trees. 281 SCRA 75 (1997). concur. Incorporated v. 16 Resolution dated September 24. Inc. 47 PHILYARDS’ Manifestation and Comment dated June 26. p. p. at 22. L-17587. Rollo. 1876. Rollo. 2004. shall be final and not appealable to the Court en banc. C. Summit’s Motion for Reconsideration dated October 17. 195 (1953). 44 Philippine Banking Corporation v. Inc. 33 COP and APT’s Comment dated January 14. 31 Id. 29 Id. p. pp. Rollo. 36. 8 Rollo. 3. WHEREFORE. Rollo. 32 Id. 10. Bocaling & Co. 9 Rollo. 14. 4(3). p. 20 Sec. 49 Art. 31-32. p. Rollo. Summit’s Consolidated Reply dated March 11. 1967. 6. 8-16. 1984. 1972. p. III. CA . 23 Id. p. 10. Art. 36 Resolution dated September 24. February 7. Summit’s Consolidated Comment dated March 8. 17 Id. 2003. 1867. 206 SCRA 668 (1992). p. 45 J. Article XII.G.2 Under the Public Land Act. The Court en banc is not an Appellate Court to which decisions or resolutions of a Division may be appealed. p. 1949. the prohibition in the Constitution applies only to 48 ownership of land. p. the decision or resolution shall be returned to the referring Division. 2004.. Jr. Rollo. 25 PHILYARDS’ Comment dated February 3. at 14 – 22. Garcia v. 1927-1928. Summit’s Motion for Reconsideration dated October 17.. Rollo. VIII. shall be entertained. It does not extend to immovable or real property as defined under Article 415 of the Civil Code. 1996-1997. p. 1878. 1987 Constitution). in which case. when concurred in by a majority of its Members who actually took part in the deliberations on the issues in a case and voted thereon. the petitioner’s Motion for Reconsideration is DENIED WITH FINALITY and the decision appealed from is AFFIRMED. September 12. 1989. Rollo. Civil Code. p..J. 24 Id. at 22 – 25. 2004. pp. 21 Supreme Court Circular No. 41 PHILYARDS’ Manifestation and Comment dated June 26. p. at 19. Rollo. 46 Id. 205 SCRA 705. National Economy and Patrimony. Corona. Rollo. Rollo. When a decision or resolution is referred by a Division to the Court en banc. Rollo. in the absence of sufficiently important reasons. 2003. 14-15. February 3. 7. 1866-1872. and Tinga. at 12. Rollo.

respondents. J. CA). Branch I.R. 1957 dismissed the protests and ordered the occupants to vacate the lot and remove their improvements. No. vs. and to the 1964 decision of the trial court. 1961 in the Court of First Instance of Davao. ABDON DEIMOS. Julian Locacia 6. Nicolas Garlic 3. 3711. EMILIO CADAYDAY. Benito Ente 36. Meliton Sante 19. INC. The forty defendants were Identified as follows: 1. JESUS ROSALITA. SR.. Okay vs. ** Because the alleged occupants refused to vacate the land. Guillermo Omac 12. SR. GUILLERMO DAGOY. TRINIDAD GARLET.. Porfirio Enoc 35. Rufo Garlic 4. No appeal was made from that decision. Davao City with an area of about two hundred fifty hectares. DE DIANNA. VICENTE ABAQUETA. Civil Case No. Cosme Villegas . PROVINCIAL SHERIFF OF DAVAO. Amil Sidaani 20. 28. DIEGO ONGRIA. NICOLADA NAQUILA. NELLO DIVINAGRACIA. Some occupants of the lot protested against the sale. 30. ejecting some of the petitioners from the land purchased. for which a sales patent and Torrens title were issued in 1975. L-46729 November 19. Marcosa Vda. Pulong Gabao 39. MINISTER OF NATURAL RESOURCES and DIRECTOR OF LANDS. The Director found that the protestants (defendants in the 1961 ejectment suit.. MERQUIADES EMBERADOR. de Rejoy 14. JUDGE VICENTE N. Rollo of L-43505. V-6834 Cadastral Lot No. some of whom are now petitioners herein) entered the land only after it was awarded to the corporation and. JR. Alfonso Ibales 5. JULIO AYOG. Filomeno Labantaban 7. Arcadio Ayong 24. PORFERIO ENOC. Toribio Naquila 10. petitioners. ESTEBAN DIVINAGRACIA. He found that some claimants were fictitious persons (p. therefore. Article XIV of the 1973 Constitution (disqualifying a private corporation from purchasing public lands) to a 1953 sales award made by the Bureau of Lands. TORIBIO NAQUILA. Constancio Garlic 40. Ciriaco Fuentes 38. an ejectment suit ( accion publiciana). awarded to Biñan Development Co.: This case is about the application of section 11. Santos Militante 9. LEODEGARDIO DIVINAGRACIA. FORTUNATA GEONZON. Elpidio Okay 11. they could not be regarded as bona fide occupants thereof. NICASIO DE LEON. ALFREDO DIVINAGRACIA. NICOLAS GARLET. The Director characterized them as squatters. CA). Generoso Bangonan 25. BENITO AYOG. FRUCTUOSO CHUA. intervenors. VIDAL ALBANO. 281 located at Barrio Tamugan. IGNACIA RIBAO. which decision was affirmed in 1975 by the Court of Appeals. ANTONIO BALDOS. Alfredo Divinagracia 31. Teodolfo Chua 28. Julio Ayog 23. HERACLEO CHUA. Guianga (Baguio District). the corporation filed against them on February 27. EFREN OKAY. German Flores 37. That legal question arises under the following facts: On January 21. Eniego Garlic 2. Rollo of L-43505. Ramon Samsa 16. The Director of Lands in his decision of August 30. Arcadio Lumantas 8. DAMASO AYOG. VICENTE PATULOT. CUSI. Jesus Emperado 34. AQUINO. Okay vs. ARMANDO TANTE and ANSELMO VALMORES. Galina Edsa 33. Inc. Rebecca Samsa 17. JULIANA VDA. Anastacia Vda. the Director of Lands. SOFRONIO ENOC. ROMERO BINGZON. Vicente Abaqueta 21.. Candido Abella 22. He issued a writ of execution but the protestants defied the writ and refused to vacate the land (p. RAFAEL GAETOS.. SEGUNDA AYOG. Emilio Padayday 13. FELICIANO ARIAS. ERNESTO PANARES. Guillermo Dagoy 29. Court of First Instance of Davao.. Silverio Divinagracia 32. BERNARDINO ADORMEO. JUANO RICO. JESUS EMPERADO. de Didal 30. Jose Catibring 27. MAXIMO BALDOS. Lorenzo Rutsa 15. and BINAN DEVELOPMENT CO. after a bidding. 1953. Lomayong Cabao 26.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 77 G. on the basis of its 1951 Sales Application No. Alfeao Sante 18. 1982 LAUSAN AYOG. ELPIDIO OKAY. DEMOCRITO DEVERO.

Alfeo Sante. the term "vested right" expresses the concept of present fixed interest.. testified that they entered the disputed land long before 1951 and that they planted it to coconuts. Inc. CA-G. It has been observed that. Inc. lt could not be abrogated by the new Constitution. Court of Appeals. 1174.3 hectares. recommending approval of the sales patent. Record on Appeal). They contended that the adoption of the Constitution. of Secretary of Justice Vicente Abad Santos and was an exception to the prohibition in section 11. Rollo). The due process clause prohibits the annihilation of vested rights. .R. 498. On July 18. Section 2. Julio Ayog. L43505. On August 24. Jose Emperado. to enforce contracts. Jose Catibring. Elpidio Okay. noted that the applicant had acquired a nested right to its issuance (p. 64. Rosenthal. Farrales. 15. The Director of Lands in his memorandum dated June 29.J. The patent was registered. generally. OnNovember 10. meaning that they were not existing in 1953 when the sales award was made. Leido. citing Pennsylvania Greyhound Lines. 1964 found that the plantings on the land could not be more than ten years old. 5681 was issued to the corporation for that lot with a reduced area of 175. No. 37142. Record on Appeal). Jr.S. It was only more than thirteen years later or on August 14. the corporation filed a motion for execution. vs. 258. 1173). some of whom are now petitioners herein. 1976 in Elpidio Okay vs." The lower court suspended action on the motion for execution because of the manifestation of the defendants that they would file a petition for prohibition in this Court. "A right is vested when the right to enjoyment has become the property of some particular person or persons as a present interest" (16 C. pointed out that the purchaser corporation had complied with the said requirements long before the effectivity of the Constitution. the trial court during its ocular inspection of the land on November 8. 1177-78). was a supervening fact which rendered it legally impossible to execute the lower court's judgment.R. Arcadio Lomanto. Furthermore. Porfirio Enoc. They invoked the constitutional prohibition. The trial court found that the protests of twenty of the abovenamed defendants were among those that were dismissed by the Director of Lands in his 1957 decision already mentioned. coffee. Generoso Bangonan. Hence. in approving the patent on August 14. cannot deny (16 C. or an innately just and imperative right which an enlightened free society. there was a trial in the ejectment suit. 1961. or by a change in the constitution of the State. the trial court ordered the defendants to vacate the land and to restore the possession thereof to tile company. We hold that the said constitutional prohibition has no retroactive application to the sales application of Biñan Development Co. that "no private corporation or association may hold alienable lands of the public domain except by lease not to exceed one thousand hectares in area. Article XIII of the 1935 Constitution allows private corporations to purchase public agricultural lands not exceeding one thousand and twenty-four hectares. 248. 6) or "some right or interest in property which has become fixed and established and is no longer open to doubt or controversy" (Downs vs. It is "the privilege to enjoy property legally vested. It believed the report of an official of the Bureau of Lands that in 1953 the land was free from private claims and conflicts and it gave much weight to the decision of the Director of Lands dismissing the protests of the defendants against the sales award (p. Some of the petitioners were not defendants in the ejectment case. 1974 for the Secretary of Natural Resources. Toribio Naquila. (p. vs. 20. The trial court did not give credence to their testimonies. already mentioned. Rollo). sensitive to inherent and irrefragable individual rights. 30. P-5176 was issued to the patentee. 28. opposed the motion. No. an official of the Bureau of Lands submitted a final investigation report wherein it was stated that the corporation had complied with the cultivation and other requirements under the Public Land Law and had paid the purchase price of the land (p. and enjoy the rights of property conferred by the existing law" (12 C.J. Before that patent was issued. After the record was remanded to the trial court. Fifteen defendants (out of forty). The review of the decision was denied by this Court on May 17. which took effect on January 17. Inc. that the land in question was free from claims and conflicts and that the issuance of the patent was in conformity with the guidelines prescribed in Opinion No. 1975 when Sales Patent No.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 78 That ejectment suit delayed the issuance of the patent.. Inc. Note 71. which in right reason and natural justice should be protected against arbitrary State action. Note 46. 192 Atl. The defendants. Arcadio Sarumines and Felix Tahantahan. The Court of Appeals affirmed that judgment on December 5. Article XIV of the Constitution (p. namely. 502). cited in Balboa vs. No. 1973. 1961 the purchase price of ten thousand pesos was fully paid by Binan Development Co. 51 Phil. jackfruit and other fruit trees.J. by the enactment or by the subsequent repeal of a municipal ordinance. Rollo).S. Sante. because it had already acquired a vested right to the land applied for at the time the 1973 Constitution took effect. "A state may not impair vested rights by legislative enactment. 2nd 587). series of 1973. Rebecca Samsa.J. 955.. except in a legitimate exercise of the police power" (16 C. Meliton Sante. That vested right has to be respected. Guillermo Bagoy. Ramon Samsa. Blount 170 Fed. 259. 1975 in its decision in Binan Development Co. Original Certificate of Title No. 1977. the instant prohibition action was filed. Secretary of Natural Resources Jose J.S. 1975.. Petitioners' prohibition action is barred by the doctrine of vested rights in constitutional law. 5.

series of 1976. 47 Phil. would be violative of due process of law. The State should endeavor to help the poor who find it difficult to make both ends meet and who suffer privations in the universal struggle for existence. The common man should be assisted in possessing and cultivating a piece of land for his sustenance. which proceeds upon inquiry and renders judgment only after trial. 75 SCRA 234 and Berses vs. As we cannot review the factual findings of the trial court and the Court of Appeals. Inc. Ciriaco Tebayan. Its compliance with the requirements of the Public Land Law for the issuance of a patent had the effect of segregating the said land from the public domain. 126. 520). 140. In Opinion No.size farm" and to prevent a recurrence of cases like the instant case. one purpose of the constitutional prohibition against purchases of public agricultural lands by private corporations is to equitably diffuse land ownership or to encourage "owner-cultivatorship and the economic family. the administrative authorities should find ways and means of accommodating some of the petitioners if they are landless and are really tillers of the soil who in the words of President Magsaysay deserve a little more food in their stomachs. Petitioners' counsel claims that Biñan Development Co. 1977. Nevertheless. employees of the Crown .) Contempt incident. See Gatchalian vs.-During the pendency of this case. We hold that judgment cannot be enforced against the said petitioners who were not defendants in that litigation or who were not summoned and heard in that case. against some of the petitioners who were not defendants in that suit (p. before the Constitution took effect. entitled to a sales patent (p. Rollo). 3711. Those petitioners are not successors-in-interest of the defendants in the ejectment suit. the rich are choking with the superfluities of life but the famished multitude lack the barest necessities. L-35615 and Tang Tee vs. under the protection of the general rules which govern society. is the law of the land. the applicant was. nevertheless. Villanueva. a little more shelter over their heads and a little more clothing on their backs.. particularly freedom from want. we have no choice but to sustain its enforceability. 38 Phil. It is a correct interpretation of section 11 of Article XIV. The corporation's right to obtain a patent for that land is protected by law. 185. Arlegui. Generally. Keller & Co. to avoid agrarian unrest and to dispel the notion that the law grinds the faces of the poor. we cannot entertain petitioners' contention that many of them by themselves and through their predecessors-in-interest have possessed portions of land even before the war. In Opinion No. he held that as soon as the applicant had fulfilled the construction or cultivation requirements and has fully paid the purchase price. On that issue. CA." (Cited in Lopez vs. Those petitioners occupy portions of the disputed land distinct and separate from the portions occupied by the said defendants. Such a contemporaneous construction of the constitutional prohibition by a high executive official carries great weight and should be accorded much respect. Huge landholdings by corporations or private persons had owned social unrest. Our jurisdiction is limited to the resolution of the legal issue as to whether the 1973 Constitution is an obstacle to the implementation of the trial court's 1964 final and executory judgment ejecting the petitioners. 123 Phil. A tiller of the soil is entitled to enjoy basic human rights. 23. 254. Secretary Abad Santos held that where the cultivation requirements were fulfilled before the new Constitution took effect but the full payment of the price was completed after January 17. Rollo). or at about four o'clock in the morning of December 12.. the law which. it is incontestable that prior to the effectivity of the 1973 Constitution the right of the corporation to purchase the land in question had become fixed and established and was no longer open to doubt or controversy. 25 Phil. Arlegui. to give him social security and to enable him to achieve a dignified existence and become an independent. the ejectment suit from which this prohibition case arose. a law which hears before it condemns. Domingo Nevasca. there would seem to be no legal or equitable justification for refusing to issue or release the sales patent (p. Rogelio Duterte and Sofronio Etac. property. "it is an axiom of the law that no man shall be affected by proceedings to which he is a stranger" (Ed. 256. "The meaning is. Rollo). liberty. Director of Lands. self-reliant and responsible citizen in our democratic society. series of 1974. In the instant case. To guarantee him that right is to discourage him from becoming a subversive or from rebelling against a social order where.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 79 Secretary of Justice Abad Santos in his 1973 opinion ruled that where the applicant. 514. 1978. according to Daniel Webster in his argument in the Dartmouth College case. 1973. They should have filed homestead or free patent applications. To enforce the judgment against those who were not parties to the case and who occupy portions of the disputed land distinct and separate from the portions occupied by the defendants in the ejectment suit. 32. A. 473. in the interest of social justice. as the architect of the French Revolution observed. had fully complied with all his obligations under the Public Land Act in order to entitle him to a sales patent. 919). Indeed. that every citizen shall hold his life. he should be deemed to have acquired by purchase the particular tract of land and to him the area limitation in the new Constitution would not apply. February 17. Nor do they derive their right of possession from the said defendants. vs Ellerman & Bucknall Steamship Co. and immunities. L-41360. seeks to execute the judgment in Civil Case No. It cannot be deprived of that right without due process (Director of Lands vs.

Escolin. Concepcion. JJ. agents or privies. one of the petitioners herein. coconut and banana plants. 1979 asked that the four tractor drivers and Honesto Garcia. Vicente Rehoy was a landowner and barrio captain. Makasiar and De Castro. executed a quitclaim in favor of the Crown Fruits and Cannery Corporation (Exh.. some of the adverse claimants or protestants were not landless farmers but were well-educated persons belonging to the middle class. According to the 44 petitioners. 126. Rollo). that he (Garcia) could not wait anymore for the termination of this case. J. 1977. Emberador was in the hospital at the time the alleged destruction of the improvements occurred. Civil Case No. concur. 1. concurring: I concur with the very ably written main opinion. Emberador was not named specifically in the trial court's judgment as one of the occupants to be ejected. Inc. he is not included in the trial court's decision although he was joined as a co-petitioner in this prohibition case. Civil Case No. concurs. 2 and 3). Rollo). enjoining specifically Judge Vicente N. Patricio de Leon was a cashier and later assistant branch manager of the Philippine National Baank. the manager of Biñan Development Co. However. it should be noted that Emberador was not expressly named as a defendant in the ejectment suit. The temporary restraining order was not directed to Biñan Development Co.. Footnotes * According to respondent corporation. The contempt proceeding is also dismissed. 3711. Judge Martinez found that the plowing was made at the instance of Garcia who told the barrio captain.. Martinez of the Court of First Instance of Davao. Garcia and the four drivers answered the motion. I wish to erase any possible erroneous impression that may be derived from the dispositive portion insofar as it declares that the judgment in the ejectment cage may not be enforced against the petitioners who were not defendants in Civil Case No.. The incident was assigned for hearing to Judge Antonio M. J. C. in consideration of P3. 49 SCRA 343). 1979 or four months after the said incident... Fernando. plowed or bulldozed with their tractors a portion of the disputed land which was occupied by Melquiades Emberador. We have previously held that the judgment in an ejectment case may be enforced not only against the defendants therein but also against the members of their family. 3711 (pp. The four tractor drivers destroyed the improvements thereon worth about five thousand pesos consisting of coffee. they are tillers of the soil (p. Relova and Gutierrez. In resume. For the redress of whatever wrong or delict was committed against Emberador by reason of the destruction of his improvements. 3711 and over whom the lower court did not acquire jurisdiction. Rules of Court).. 138. Emberador.. Thus. Melencio-Herrera. 49[b]. The judgment in any case is binding and enforceable not only against the parties thereto but also against "their successors in interest by title subsequent to the commencement of the action" (Sec. SO ORDERED. to the canning corporation.500. Jr. Cusi and the provincial sheriff from enforcing the decision in the ejectment suit. Jr. Ernesto Pañares was a high school teacher and later a college professor. Plana. Delos Angeles.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 80 Fruits and Cannery Corporation. The petitioners in their motion of January 11. Rule 39.141. his remedy is not in a contempt proceeding but in some appropriate civil and criminal actions against the destroyer of the improvements. petitioner Lausan Ayog. Separate Opinions VASQUEZ. WHEREFORE. A further clarification of the dispositive portion is apparently needed to exclude from the effect of the judgment in the ejectment case only the petitioners who do not derive their right of possession from any of the defendants in the ejectment suit. as the value of the improvements on his land. the petition is dismissed for lack of merit but with the clarification that the said judgment cannot be enforced against those petitioners herein who were not defendants in the ejectment case. However. The constitutional prohibition relied upon by the petitioners as a ground to stop the execution of the judgment in the ejectment suit has no retroactive application to that case and does not divest the trial court of jurisdiction to enforce that judgment. JJ. Apparently. We hold that no contempt was committed. Guerrero.. a Bagobo. Inc. The disputed land was leased by Biñan Development Co. we find that there is no merit in the instant prohibition action. Elpidio Okay was an elementary school principal. No costs. and over whom the lower court did not acquire jurisdiction. took no part. Inc. Teehankee..J.. Rollo). its officers. their relatives or privies who derive their right of possession from the defendants (Ariem vs. The record shows that on April 30. Abad Santos. Francisco Mateo was a former college dean (p. . 105. 46-47. be declared in contempt of court for having disregarded the restraining order issued by this Court on August 29.

" 4. 5-7. JESUS ASUNCION. V . lode patent No. and it should be the grantor who should institute the cancellation proceedings. MELENCIO ASUNCION and BIENVENIDO ASUNCION." 5. 1959. Free Patent No.. the lands involved being public In character.R. 1968 and corresponding Certificate of Title No. Jr. Carlos Stilianopulos.51 to Carlos Stilianopulos on mineral claim known as "Jovellar. to appellee Maria Bernal. John Canson. lode patent No. FELIX DETECIO. the Register of Deeds of Albay issued the respective original certificates of titles pursuant to Section 122 of Act No. J.. 2. lode patent No. filed his answer alledging. lode patent No. 1962. The assignment of rights was recorded in the Office of the Mining Recorder of Albay on December 2. 0663 dated March 25. GREGORIA BOLANOS. 5. and The aforestated mining patents. V . V-53 to John Canson. INC.. the trial court rendered a decision dismissing the complaint." 7. Decision Annex 1. 1969 and corresponding Certificate of Title No. 427824 dated November 21. that the petitioner has no personality to institute the cancellation proceedings inasmuch as the government is the grantor and not the petitioner. 1968 and No. 408568 dated July 8."(pp. 1962. V . on mineral claim known as "Catanduandes.50 to Carlos Stilianopulos on mineral claim known as "Polangui. DIRECTOR OF LANDS. Petition) Way back on October 30.. MARIA BERNAL. among others. 1962 in the Registration Book of the Registry of Deeds of Albay. 1968 and corresponding Certificate of Title No. Subsequently. the action for reversion should be 1. Consequently. 1974 and the corresponding Certificate of Title No. Jr. The petitioner filed a complaint for annulment and cancellation of patents against the private respondents and prayed that all the free patent titles issued in their favor for properties over which original certificates of title had already been issued in its favor be declared null and void. AUREA ARAOJO. GERVACIO ARAOJO.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 81 G.: Before us is a petition which seeks to set aside the decision of the then Intermediate Appellate Court affirming the dismissal of the petitioner's action for annulment and cancellation of free patents granted to the private respondents on the ground that the petitioner has no personality to file an action for reversion. 1969 and corresponding Certificates of Title Nos.49 to petitioner. the President of the Philippines granted the following mining patents on mineral claims located at Ungay Malobago." 2. VH-11591 to appellee Gregorio Bolanos. after their issuance on July 20. pp. On July 20. 1980. in mineral claim known as "Manila. 1968 and corresponding Certificate of Title No. and Carlos Stilianopulos assigned their rights to their mining claims in favor of the petitioner. V ." 3. No. VH-19333 to appellee Bienvenido Asuncion. L-69997 September 30. GUTIERREZ. 1959. Rapu-Rapu Albay. respondents. Jr. 496 in the names of John Canson. It ruled that since the disputed properties form part of disposable land of the public domain. the following free patents were granted by the respondent Director of Lands and the corresponding original certificates of titles were issued by the Register of Deeds of Albay: . lode patent No. Free Patent No. Free Patents No. 458143 dated October 3. V-48 to petitioner.47 to petitioner on mineral claim known as "Ligao. V-52 to John Canson. were all recorded in the Office of the Mining Recorder of Albay on August 28. Free Patent No. 433318 dated January 10. 422847 dated November 11. VH-12256 to appellee Melencio Asuncion. VH-12198 to appellee Jesus Asuncion. 4. Free Patent No.. or from 1968 to 1974. petitioner. VH-12195 to appellee Felix Detecio. The Director of Lands." 6. 1. vs. INTERMEDIATE APPELLATE COURT. VH-12185 and 12186. lode patent No." and 8. on mineral claims known as "Oas. respectively. and the petitioner. Jr. 1987 UNGAY MALOBAGO MINES. HON. who was impleaded as a formal defendant. (Rollo. V .46 to petitioner on mineral claim known as "Ester. Free Patent No. JR. 3. 1962 and transcribed on September 4. lode patent No. lode patent No. 6. 200-201) All of the above patents covered portions of the lots covered by the patents belonging to the petitioner. 421947 dated October 28. on mineral claims known as "Junior. On January 25.

all forces of potential energy. fisheries. requirements. we conclude that the issuance of the lode patents on mineral claims by the President of the Philippines in 1962 in favor of the petitioner granted to it only the right to extract or utilize the minerals which may be found on or under the surface of the land. 1984. . exploitation. . shall not be alienated and no license. 1935 as to when essential acts regarding its mining claims were executed. With regard to the first issue. A mere mention in the Torrens title that the provisions of the Philippine Bill of 1902 were followed is not sufficient. applying the aforequoted provision to the case at bar. According to the Court. and inexplicably silent as to material dates in the presentation of its case. The petitioner has failed to state if and when new procedures. the petitioner raises two issues: a) Whether or not the appellate court committed an error of law when it ruled that the lands in question belong to the public domain. and provisions of the Act of the United States of Congress of July 1. or utilization of any of the natural resources shall be granted for a period exceeding twenty-five years. as amended. or concession at the time of the inauguration of the Government established under this Constitution. the provision of the latter with regard to inalienable lands of the public domain will apply. 1935. Section 1. or industrial uses other than the development of water power. Nowhere in the records of this petition is there any mention of a date before November 15. Section I of the 1935 Constitution provides: All agricultural timber. The Philippine Bill provides the procedures for the perfection of mining claims but not the dates when such procedures were undertaken by any prospector or claimant. and b) whether or not the appellate court erred in discussing the complaint on the ground that the petitioner had no personality to institute the same. 66 Phil. renewable for another twenty-five years. whether or not the annual amount of labor or development. The Solicitor-General. less than candid. On the other hand. or lease for the exploitation. coal. All that petitioner offers as evidence of its claims were the original certificates of titles covering mining patents which embodied a uniform "WHEREAS" clause stating that the petitioner "has fully complied with all the conditions. Under the then Constitution. development. waters. on the other hand. or to corporations or associations at least sixty per centum of the capital of which is owned by such citizens. the applicable law is the Philippine Bill of 1902 and that under this Act. different from the 1902 procedures. argues that the petitioner's mining patents covered by Torrens Titles were granted only in 1962 by the President of the Philippines. when the legal posts and notices were put up. measured. Petitioner has not established by clear and convincing evidence that the locations of its mining claims were perfected prior to November 15. the date when the 1935 Constitution took effect. subject to any existing right. In fact neither the original complaint nor the amended one alleged the perfection of petitioner's mining rights prior to November 15. or utilization shall be limited to citizens of the Philippines. with the exception of public agricultural land. In this instant petition. the appellate court affirmed the decision of the trial court. when the claim was registered with the mining recorder. the issuance of the free patents by the respondent Director of Lands in 1979 in favor of the private respondents granted to them the ownership and the right to use the land for agricultural purposes but excluding the ownership of. and plotted. 1902. and the right to extract and utilize.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 82 instituted by the Solicitor General in the name of the Republic of the Philippines and that. (Emphasis supplied) Therefore. and their disposition. 1935 Constitution) Therefore." In the absence of proof that the petitioner's claims were perfected prior to the 1935 Constitution. only the Solicitor General or the officer acting in his stead has the authority to institute an action on behalf of the Republic for the cancellation of the respondents' titles and for reversion of their homesteads to the Government. (Gold Creek Mining Corporation v. lease. We rule for the private respondents. and other requirements under the Philippine Bill of 1902 were followed. 259). 1935. (Art. shall not be alienated. under Section 101 of the Public Land Law. The petitioner appealed to the then Intermediate Appellate Court. were provided by law to give a little substance to its case. natural resources which includes all mineral lands. The petitioner has been beguiling. It is silent as to when the land was entered. The petitioner is completely and strangely silent about these vital aspects of its petition. and mineral lands of the public domain.. Natural resources.. The same procedures would have to be followed even after the Jones Law of 1916 and the Constitution of 1935 were promulgated. therefore. the petitioner maintains that since its mining claims were perfected prior to November 15. and other natural resources of the Philippines belong to the State. XIII. petroleum. the minerals which may be found on or under the surface. water supply. except as to water rights for irrigation. the minerals within the area covered by the petitioner's Torrens Titles but not the ownership of the land where the minerals are found. concession. grant. On April 5. development. the petitioner lacks personality to institute the annulment proceedings. and other mineral oils. but subject to the restrictions of the fundamental law.1935 when the Government of Commonwealth was inaugurated. except for public agricultural lands. and the right to extract or utilize. Rodriguez. a valid location of a mining claim segregates the area from the public domain. minerals. what the mining patents issued in 1962 conveyed to petitioner was only the ownership of. These may have been complied with but not necessarily before 1935. by authority of the Constitution of the Philippines. It ruled that the titles issued to the petitioner cover mineral lands which belong to the public domain and that these cannot be the subject of private ownership. Article XIII. in which cases beneficial use may be the measure and the at of the grant.

(See Sumail v. Every application for a concession of public land has to be viewed in the light of its peculiar circumstances. the grantee does not. A patent is void at law if the officer who issued the patent had no authority to do so (Knight v. et al. Court of Appeals. patents and land grants are construed favorably in favor of the Government. Feliciano. Hence. . Martinez. (See Ledesma vs. In the case at bar. become the owner of the land illegally included. Fernan. and Heirs of Tanak Pangawaran Patiwayan v.S. 142 SCRA 252). is to be resolved in its favor.. the petition is hereby DISMISSED for lack of merit. 946. emphasis supplied). 69). Animas (56 SCRA 499). The mineral lands over which it has a right to extract minerals remained part of the inalienable lands of the public domain and thus. making such acquisition outside its purview and scope. Funtilar 142 SCRA 57. 156). (Director of Lands v. by mistake or oversight. by virtue of said certificate of title alone. lands which cannot be registered under the Torrens System. The decision of the Intermediate Appellate Court is AFFIRMED. Land Ass. The appellate court did not likewise err in concluding that the petitioner has no personality to institute the action below for annulment and cancellation of patents. If a person obtains a title under the Public Land Act which includes. SO ORDERED. 769) Moreover. the former cannot prevail over the latter for the provisions of the Constitution which governed at the time of their issuance prohibited the alienation of mineral lands of the public domain. and most strongly against the grantee. 258.. although the original certificates of titles of the petitioner were issued prior to the titles of the private respondents. 12 Sup. only the Solicitor General or the person acting in his stead can bring an action for reversion. this Court ruled that a grantee does not become the owner of a land illegally included in the grant just because title has been issued in his favor:. 35L ED. as earlier stated. 49 Phil. Judge of the Court of First Instance of Cotabato. In the case of Republic v. thus. Ct. the titles issued in its favor must be construed as conveying only the right to extract and utilize the minerals thereon. concur. 974. or the intention of the Government.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 83 There is no basis in the records for the petitioner's stand that it acquired the right to the mineral lands prior to the effectivity of the 1935 Constitution. JJ. Bidin and Cortes. WHEREFORE. 96 Phil. (See Republic v. 73 SCRA 146. 161.. Municipality of Iloilo. Any doubt as to the intention or extent of the grant. Costs against the petitioner. 142 U. or when the Director of Lands did not have jurisdiction over the same because it is a public forest. in the absence of proof that the petitioner acquired the right of ownership over the mineral lands prior to the 1935 Constitution.

appellees' predecessor-ininterest. DEOGRACIAS ERMITAÑO DE GUZMAN. Socorro de la Rosa. YNARES-SANTIAGO. subject to the claims of oppositors Dominga Ermitaño. 1965. Act 946 and/or P. In finding that private respondents' possession of the subject property complied with law. Thus the period of occupancy of the subject parcels of land from 1965 until the time the application was filed in 1991 was only twenty six (26) years. Flora Manalo. said judgment was affirmed and the petition for registration of private respondents over the subject parcels of land was approved. The land. TG-362 and TG-396. respondents. which is agricultural. 29 andR. We find merit in the instant Petition.D. 3 REPUBLIC OF THE PHILIPPINES. Zenaida Ermitaño De Guzman. Cavite. 396. FLORA MANALO. on appeal to the Court of Appeals. SOCORRO DELA ROSA. It follows that appellees' possession as of the time of the filing of the petition in 1991 when tacked to Pedro Ermitaño's possession is 63 years or more than the required 30 years 7 period of possession. We disagree. It is not disputed that the subject parcels of land were released as agricultural land only in 1965 while the 6 petition for confirmation of imperfect title was filed by private respondents only in 1991.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 84 G. as supported by its technical descriptions now forming parts of the records of these cases. The facts are simple: Conflicting applications for confirmation of imperfect title were filed by Norma Almanzor and private respondent Salvador De Guzman over parcels of land located in Silang. the instant Petition. No. Alicia Ermitaño De Guzman and Salvador De Guzman. (2) In LRC Case No. DAMIAN ERMITAÑO DE GUZMAN. vs. MELBA E. Cavite. Jose Ermitaño and Esmeranso Ermitaño under an instrument entitled "Waiver of Rights with Conformity" the terms and conditions of which are hereby ordered by this Court to be annotated at the back of the certificates of title to be issued to the petitioners pursuant to the judgment of this Court. Hence. in addition to other proofs adduced in the names of petitioners Damian Ermitaño De Guzman. cultivating it and planting various crops thereon. ZENAIDA ERMITAÑO DE GUZMAN. JOSE ERMITAÑO. Torres. to wit — WHEREFORE.A. ESMERANDO ERMITAÑO. ALICIA ERMITAÑO DE GUZMAN. Almanzor for lack of factual and legal bases. was already in possession of the property. Deogracias Ermitaño De Guzman. After trial on the merits. 137887 February 28. judgment is hereby rendered by this Court as follows: (1) In LRC Case No. 14. four (4) years short of the required thirty (30) year period possession requirement under Sec. in LRC Cases No. Natividad Encarnacion. J. 5 . TG-362. all married. the land described in Plan Psu-67537-Amd-2 and containing an area of 308. SALVADOR ERMITAÑO DE GUZMAN. the lower court rendered judgment in favor of private respondent De Guzman.: Before us is a Petition for Review on Certiorari of a decision of the Court of Appeals affirming the 2 judgment of the Regional Trial Court of Tagaytay.R. NATIVIDAD ENCARNACION. 1529. has been converted to private property. 6940. Carmona. this Court hereby denies the application for registration of the parcels of land mentioned therein by applicant Norma R.D. DOMINGA ERMITAÑO. TRICOM DEVELOPMENT CORPORATION and FILOMENO ERMITAÑO. petitioner. Branch 18. TORRES. 1 As earlier mentioned. anchored upon the following assignments of error — I THE TRIAL COURT ERRED IN NOT FINDING THAT THE DE GUZMANS HAVE NOT SUBMITTED PROOF OF THEIR FEE SIMPLE TITLE OR POSSESSION IN THE MANNER AND FOR THE LENGTH OF TIME REQUIRED BY LAW TO JUSTIFY CONFIRMATION OF AN IMPERFECT TITLE. No. of legal age and with residence and postal addresses at Magallanes Street. Melba E. 2000 SO ORDERED. otherwise known as the Property Registration Law. however. this Court hereby approves the petition for registration and thus places under the operation of Act 141. records indicate that as early as 1928. P.638 square meters. II THE TRIAL COURT ERRED IN NOT DECLARING THAT THE DE GUZMANS HAVE NOT OVERTHROWN THE PRESUMPTION THAT THE LANDS ARE PORTIONS OF THE PUBLIC DOMAIN BELONGING TO 4 THE REPUBLIC OF THE PHILIPPINES. the Court of Appeals reasoned out that — (W)hile it is true that the land became alienable and disposable only in December. Pedro Ermitaño.

Records. 11 Ituralde vs. Court of 9 Appeals misplaced. LRC Case No.J. any occupation or possession thereon cannot be considered in the counting of the thirty year possession requirement. dated 26 February 1998. 1968. 24-38. the rules on confirmation of imperfect title do not apply (Amunategui vs. 161 [1920]. It accords with our ruling in Director of Lands vs.R. therefore. Court of Appeals. The fact remains that from the time the subject land was declared alienable until the time of their application. Thus possession of forest lands. CV No. Court of Appeals. Court of Appeals. the same was forest land incapable of private appropriation. TG-362. 95608.nêt SO ORDERED.R. Director of Lands vs. or before it was declared alienable and disposable land of the public domain on January 13. 401 [1997]. Branch 38. Prior to such date. 178 SCRA 708. 120652. While we acknowledge the Court of Appeals' finding that private respondents and their predecessors-ininterest have been in possession of the subject land for sixty three (63) years at the time of the application of their petition. citing Sunbeam Convenience Foods. private respondents' occupation thereof was only twenty six (26) years. Court of Appeals. 129 SCRA 689 [1984]). 6 See Petition. could not ripen into private ownership. Ibarra Bishar. Puno. G. 89 SCRA 648. Footnotes 1 2 CA-G. C. Director of Lands vs.. 41 Phil. On the other hand. Vera.R. 1-18.R. pp. Judgment is rendered dismissing LRC Case No. 126 SCRA 69. 98. cannot convert them into private property. 454. could not convert it into private property. too. 12 De la Cruz vs. Intermediate Appellate Court. concur.1âwphi1. 9 G. Court of Appeals. 448 [1990]. Rollo. no matter how lengthy. Adorable vs.R. G.. Records. Director of Lands vs. No.. p. 7-8. Petition. 94525. Director of Forestry. 14. Court of Appeals. and should be excluded from the computation of the 30-year open and continuous possession in concept of owner required under Section 48(b) of Com. 10. the instant Petition is GRANTED and the February 26. No pronouncement as to costs. Inc. 7 See Note 1. 286 SCRA 230. (emphasis ours) So. 301 SCRA 293. while the period of possession of the applicant's predecessor-in-interest was tacked to his own possession to comply with the required thirty year period possession requirement. Republic vs. Kapunan and Pardo. Possession of the land by private respondents. Act 141. which he could not have acquired by prescription. 12-13. Vallarta vs. whether spanning decades or centuries. cannot ripen into private ownership (Vamo vs. . jurisprudence is replete with cases which reiterate that forest lands or forest reserves are not capable of private appropriation and possession thereof. 10 Palomo vs. Dated 8 September 1994. 33. In summary. 129 SCRA 689. We cannot consider their thirty seven (37) years of possession prior to the release of the land as alienable because absent the fact of declassification prior to the possession and cultivation in good faith by petitioner. p. pp. Rollo. prior to its declaration as alienable land in 1965. No. G. There. Further. JJ. 48785 as well as that of the Regional Trial Court of Cavite. 181 SCRA 443.. 205 SCRA 486 [1992]. at p. WHEREFORE. Rollo. Government. 440-454. that: Unless and until the land classified as forest is released in an official proclamation to that effect so that it may form part of the disposable lands of the public domain. at p. No. This is in accord with the ruling inAlmeda vs. p. 235 [1998]. No. This Court is constrained to abide by the latin maxim "(d)ura 12 lex. 1998 decision of the Court of Appeals in CA-G. 48785. Court of Appeals. 4 Petition. 133 SCRA 701. Court of Appeals. TG-396 are both REVERSED. in LRC Case No. Jr. Falcasantos. 296 [1999]. Annex "A". to wit — The Court of Appeals correctly ruled that the private respondents had not qualified for a grant under Section 48(b) of the Public Land Act because their possession of the land while it was still inalienable forest land. 480 [1991]. 5 See Exhibit "S-4". pp. 410 [1960]). A parcel of forest land is within the exclusive jurisdiction of the Bureau of Forestry and beyond the power and jurisdiction of the cadastral court to register under the Torrens System (Republic vs.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 85 The Court of Appeals' consideration of the period of possession prior to the time the subject land was released as agricultural is in direct contravention of the pronouncement in Almeda vs. Rollo. however long. 151 SCRA 679). and because the rules on the confirmation of imperfect titles do not apply unless and until the land classified as forest land is released in an official proclamation to that effect so that it may form part of the disposable agricultural lands of the public 11 domain.R. 196 SCRA 476. Davide. sed lex". 148 SCRA 480. 128017. vs. No. Republic vs. 396 for failure of the applicants therein to comply with the thirty year occupancy and possessory requirements of law for confirmation of imperfect title. Court of Appeals. LRC Case No. 17 Phil. 266 SCRA 392.. It was not registrable and possession thereof. p. Records. in the case before us. 3 Id. CV No. et al. our hands are tied by the applicable laws and jurisprudence in giving practical relief to them. Court of Appeals. (supra). the land involved therein was not forest land but alienable public land. (unless) and until 10 such lands were reclassified and considered disposable and alienable. the property subject of private respondents' application was only declared alienable in 1965. the property occupied by him remained classified as forest or timberland. TG-396. could never ripen into ownership. Director of Forestry.R. Court of 8 Appeals. is the Court of Appeals' reliance on the case of Director of Land Management vs. 8 G. however long. 85322. 120 SCRA 210 [1983]. pp.

Such discrepancies in the appraised value as appearing in two different reports by the same appraisal company submitted within a span of one year render all such appraisal reports unworthy of even the slightest consideration. The credibility of the foregoing appraisals. The Senate Committees established the clear.07 per square meter. PEA did not consider this offer and instead finalized the JVA with AMARI.129. Ltd.. For instance.894.441) Square Meters for a total consideration of One Billion Eight Hundred Ninety Four Million One Hundred Twenty Nine Thousand Two Hundred (P1. equivalent to the budget of the entire Judiciary for seventeen years and more than three times the Marcos Swiss deposits that this Court forfeited in favor of the government. under the JVA.00 per square meter as of 26 March 1996.16 billion. (for P1. however. Young D. but the questions arise only because the private entity somehow managed to inveigle the government to sell the reclaimed lands without public bidding in patent violation of the Government Auditing Code. obligated itself to convey title and possession over the Property.000 per square meter. Mr. However.200 per square meter. or a total of P1. pegs the market value of the Property at Six Thousand Pesos (P6. consisting of approximately One Million Five Hundred Seventy Eight Thousand Four Hundred Forty One (1. at most not more than one2 half billion pesos in legitimate expenses.600 per square meter).200.732. as approved by the Senate in plenary session on 27 September 1997: The Consideration for the Property PEA. indisputable and unalterable fact that the sale of the public lands is grossly and unconscionably undervalued based on official documents submitted by the proper government agencies during the Senate investigation.R. See.00) Pesos. also as of 22 February 1995. There are those who question these figures.000 as of 27 February 1995. There were also other offers made for the property from other parties which indicate that the Property has been undervalued by PEA. 2003 According to the zonal valuation of the Bureau of Internal Revenue. The Municipal Assessor of Parañaque. at least not those of the Municipal Assessors’ office. conducted extensive public hearings to determine the actual market value of the public lands sold to the private entity.000.00 per square meter for the smallest island and P750. Senate Committee 3 Report No. the value of the Property is Seven Thousand Eight Hundred Pesos (P7. the price at which PEA agreed to convey the property is a pittance. the appraisal report submitted by the Commission on Audit estimates the value of the Property to be approximately P33. two Senate Committees. We quote the joint report of these two Senate Committees.500. where the Property is located.600 per square meter). No one seems to worry about the more than tens of billion pesos that the hapless Filipino people will lose if the contract is allowed to stand.00) Pesos per square meter. Fortunately for the Filipino people.. No. . (2) An appraisal by Valencia Appraisal Corporation concluding that the Property is worth P850 per square meter for Island I. since it has been trying to convince the Office of the Municipal Assessor of Parañaque to reduce the valuation of various reclaimed properties thereat in order for PEA to save on accrued real property taxes.805. and (3) An Appraisal by Asian Appraisal Company.00 per square meter for the two other islands. Other offers were made on various dates by Aspac Management and Development Group Inc. 560.00) per square meter. Based on these alone.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 86 G.518. or a total of P1. PUBLIC ESTATES AUTHORITY and AMARI COASTAL BAY DEVELOPMENT CORPORATION.00.000. offered to buy the property at P1. PEA’s justification for the purchase price are various appraisal reports. or a price of One Thousand Two Hundred (P1. J. And PEA cannot claim ignorance of these valuations. Inc.000 per square meter for Island I. P800 per square meter for Island II and P600 per square meter for the smallest island. vs. Metro Manila. President of Saeil Heavy Industries Co. or P21.333.00 and expressed its willingness to issue a stand-by letter of credit worth $10 million. if this Court voids the contract. CHAVEZ. Furthermore.400.170.00 as of 22 February 1995.673. particularly the following: (1) An appraisal by Vic T. Universal Dragon Corporation (for P1. published reports place the market price of land near that area at that time at a 1 high of P90. the Senate Blue Ribbon Committee and the Committee on Accountability of Public Officers.800.578. Many worry to death that the private investors will lose their investments.000.84 hectares of reclaimed public lands along Roxas Boulevard in Metro Manila at the negotiated price of P1. RESOLUTION CARPIO.289. respondents. petitioner.000.000.00) per square meter. Cleene Far East Manila FRANCISCO I. (South Korea). stating that the Property is worth approximately P1. 133250 November 11. on 06 March 1995. Salinas Realty and Consultancy Services concluding that the Property is worth P500.200. (AACI). or a total of P1. are [sic] greatly impaired by a subsequent appraisal report of AACI stating that the property is worth P4. The difference in price is a staggering P140. P950 per square meter for Island II and P600 per square meter for Island III.: This Court is asked to legitimize a government contract that conveyed to a private entity 157.

00. In addition.000.800 per square meter.193. why was PEA willing to sell for only P1.100. If AMARI was willing to pay such amount for the Property. dated 10 December 1996.00 from date of letter When sale of land begins Upon completion phase TOTAL not exceeding 157. testified that said Letter-Agreement 6 was approved by the AMARI Board.00 (P1.000.000 per square meter. Montemayor. ’95 to 31 Jan. over a 12-month pd.000.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 87 Incorporated and Hyosan Prime Construction Co. thereby subjecting the Government to grave injury and enabling AMARI to enjoy tremendous benefit and advantage.000. Frank Chua).00 if the bonus is included). This gargantuan monetary anomaly.844. or P3. making the Government stand to lose approximately P1.00 ============== Mr.00 P1. The authoritative appraisal. AMARI’s acquisition cost for the Property will add-up to P3. Whether based on the official appraisal of the BIR. on the one hand. The major flaw is not even the P1. Parañaque." Certified True Copy of BIR Zonal Valuations as certified by Antonio F. Revenue District Officer.a.k. the Government now stands to lose approximately P2.00 262. If such commissions are added to the purchase price." is not the major defect of this government contract.754 billion in commissions the Senate Committees discovered the private entity paid to various persons to secure the 5 contract.00. Ltd.754. the Government’s loss will amount to P5.k.150." the Appraisal Report of the Commission on Audit. Premchai Karnasuta and Emmanuel Sy for and in behalf of AMARI.707.841. sets forth various payments AMARI paid or agreed to pay the aforesaid stockholders by way of fees for "professional efforts and services in successfully negotiating and securing for AMARI the Joint Venture Agreement".707. This official document fixed the market value at P21.500.050. aptly earning the epithet "Grandmother of All Scams.84 hectares of 10 Post Dated Checks (PDCs) 24 PDCs 48 PDCs Cash bonus Developed land from Project Paid/Payable On 28 April 1995 Upon signing of letter 60 days from date of letter 31 Aug. Municipal Assessor. is grossly and unconscionably undervalued. as follows: Form of Payment Manager’s Checks Manager’s Checks Clearly. or a total of P1. the Municipal Assessor of Parañaque.129.855.000. the Municipal Assessor or the Commission on Audit. (Emphasis supplied) The Senate Committee Report No.333.200 per square meter purchase price. the P1." Certification of Soledad S. the external auditors of AMARI. (Emphasis supplied) .00 4 Even if we simply assume that the market value of the Property is half of the market value fixed by the Municipal Assessors Office of Parañaque for lands along Roxas Boulevard.07 per square meter.000. ’98 Amount P 400. This official document fixed the market value at P6. 560 attached the following official documents from the Bureau of Internal Revenue.992. as per the AACI appraisal report dated 26 March 1996.150.363.800.00.596.490.00 per square meter.800. the independent constitutional body that safeguards government assets. Chua Hun Siong (a.00 of each Costing 300. AMARI agreed to pay huge commissions and bonuses to various persons. as will be discussed fully below. But an even better assumption would be that the value of the Property is P4.a.84 hectares at P21.000. since this is the valuation used to justify the issuance of P4 billion worth of shares of stock of Centennial City Inc. is that of the Commission on Audit which valued the 157. Thus.00.596.000. described in Senate Report No.300. 2.200.00? x x x government lands. Luis Benitez of SGV.07 per square meter or a total of P33. on the other. (CCI) in exchange for 4. amounting to P1. which had prepared an Irrevocable Clean Letter of Credit for P100.050. With such valuation.673 billion. and the Commission on Audit: 1.000.250. This official document fixed the market value of the 157.894 billion for the 157.000. Medina-Cue.00 150. Metro Manila.863.863. Annex "N. Santiago. based on the official appraisal of the Commission on Audit. Exhibit "1-Engr.00 (excluding the bonus). 357.000.500.208. Annex "M.84 hectares at P7.050. the purchase price agreed to by PEA is way below the actual value of the Property. the actual loss to the Filipino people is a shocking P31.333. Mr. 3.000 AMARI shares with a total par value of only P480.779 billion.00 per square meter.000.000.754. Chin San Cordova (a.894.000. Benito Co) and Mr. 560 as follows: A Letter-Agreement dated 09 June 1995 signed by Messrs. Monthly. of course. and stockholders of AMARI namely.00 127. which indicate that AMARI itself believed the market value to be much higher than the agreed purchase price.

being inalienable and outside the commerce of man. Ponce. we now come to the resolution of the second Motions for Reconsideration filed by public respondent Public Estates Authority ("PEA") and private respondent Amari Coastal Bay Development Corporation ("Amari").894 billion expressly admitted before the Senate Committees that it spent P1. as well as reclaimed submerged lands. Of the 750 hectares subject of the Amended JVA. the Ponce Cases admit 9 that "submerged lands still belong to the National Government. et al. forests or timber. Clearly. This is also true with respect to foreshore lands. and other natural resources are owned by the State. under the Amended JVA the PEA contributed its rights. The Amended JVA mandates that the PEA had "the duty to execute without delay the necessary deed of transfer or conveyance of the title pertaining to AMARI’s Land share based on the Land Allocation 15 Plan. own and 14 develop the Reclamation Area." The Amended JVA further states that "the sharing of the Joint Venture Proceeds shall be based on the ratio of 13 thirty percent (30%) for PEA and seventy percent (70%) for AMARI. First. shall then cause the issuance and delivery of the proper certificates of title covering AMARI’s Land Share in the name of 16 AMARI. Reclaimed lands are no longer foreshore or submerged lands. coal. Nonetheless. however. Amari’s right to own the submerged lands is immediately effective upon the approval of the Amended JVA and not merely an option to be exercised in the future if and when the reclamation is actually realized.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 88 The private entity that purchased the reclaimed lands for P1. waters. are part of the State’s inalienable natural resources. although the documentation of the deed of transfer and issuance of the certificates of title would be made only after actual reclamation. the bulk of the lands subject of the Amended JVA are still submerged lands even to this very day. there are those who insist that the billions in investments of the private entity deserve protection by this Court. could not be the subject of the commercial transactions specified in the Amended JVA. The submerged lands." In short. with the deeds of transfer to be documented and the certificates of title to be issued upon actual reclamation. The Amended JVA states that the PEA "hereby contributes to the Joint Venture its rights and privileges to 12 perform Rawland Reclamation and Horizontal Development as well as own the Reclamation Area. Article XII of the 1987 Constitution provides: All lands of the public domain. This is why the Cebu City ordinance merely granted Essel. Amador Gomez. the PEA conveyed to Amari the submerged lands even before their actual reclamation. the second Motions for Reconsideration raise no new issues. an "irrevocable option" to purchase the foreshore lands after the reclamation and did not actually sell to Essel. L-22669 entitled "Manuel O. is that submerged lands are owned by the State and are inalienable . and thus may qualify as alienable agricultural lands of the public domain provided the requirements of public land laws are met. like the waters (sea or bay) above them. and not to foreshore lands which are inalienable. We find the cited Ponce Cases inapplicable to the instant case. 592. Amari immediately acquired the absolute right to own 70% percent of the reclamation area. the Supplement to the Dissenting Opinion claims that these two Resolutions serve as authority that a single private corporation like Amari may acquire hundreds of hectares of submerged lands. The City of Cebu. absolutely inalienable and outside the 7 commerce of man. " The correct formulation. fisheries. flora and fauna. privileges and ownership over the Reclamation Area to the Joint Venture which is 70% owned by Amari. (Emphasis supplied) Submerged lands. minerals." The Amended JVA also provides that the PEA "hereby designates AMARI to perform PEA’s rights and privileges to reclaim. Submerged lands are property of public dominion." and No. 10 . x x x. As correctly pointed out by petitioner Francisco I. Section 2. in the instant case ownership of the reclamation area." ("Ponce Cases") . x x x. including the submerged lands. all forces of potential energy. petroleum. when requested in writing by AMARI. the fatal flaw of this contract is that it glaringly violates provisions of the Constitution expressly prohibiting the alienation of lands of the public domain. In effect. wildlife. only had an "irrevocable option" to purchase portions of the foreshore lands once actually reclaimed." The Amended JVA also provides that "PEA. In sharp contrast. Ponce. Chavez in his Consolidated 8 Comment. the still to be reclaimed foreshore lands.754 billion in commissions to pay various individuals for " professional efforts and services in successfully negotiating and securing " the contract. With the exception of agricultural lands. Under the Amended JVA.15 hectares or 78% of the total area are still submerged. the City of Cebu retained ownership of the reclaimed foreshore lands and Essel. v. Hon. et al.754 billion in commissions obviously constitutes bribe money. et al. However. By any legal or moral yardstick. the PEA delegated to Amari the right and privilege to reclaim the submerged lands. Should this Court establish a new doctrine by elevating grease money to the status of legitimate investments deserving of protection by the law? Should this Court reward the patently illegal and grossly unethical business practice of the private entity in securing the contract? Should we allow those with hands dripping with dirty money equitable relief from this Court? Despite these revolting anomalies unearthed by the Senate Committees. Thus. Moreover. as Justice Bellosillo himself states in his supplement to his dissent. within Manila Bay under the Amended Joint Venture Agreement ("Amended JVA"). was immediately transferred to the joint venture. and other mineral oils. et al. Inc. the P1. In the instant case. all other natural resources shall not be alienated. Inc. and therefore inalienable and outside the commerce of man. Any sale of submerged or foreshore 11 lands is void being contrary to the Constitution. Concurring and Dissenting" of Justice Josue N. the Supplement to "Separate Opinion. Inc." In the Ponce Cases. Bellosillo brings to the Court’s attention the Resolutions of thi s Court on 3 February 1965 and 24 June 1966 in L21870 entitled"Manuel O. permanently under the waters of Manila Bay. in the Ponce Cases the option to purchase referred to reclaimed lands. v.

the Amended JVA is a negotiated contract which clearly contravenes Section 79 of PD No. Lands thus acquired by the City of Cebu for a public purpose may not be sold to private parties. PEA took the place of the Department of Environment and Natural Resources ("DENR" for brevity) as the government agency charged with leasing or selling all reclaimed lands of the public domain. are not applicable to the instant case. Justice Reynato S. which may be public or patrimonial. "foreshore and lands under water were not to be alienated and sold to private parties. However. now numbering over 80 million strong. In the hands of PEA. not to submerged lands. This scheme will effectively nullify the constitutional ban in Section 3. Inc. No patent or certificate of title has been issued to any private party. the Ponce Cases were decided under the 1935 Constitution which allowed private corporations to acquire alienable lands of the public domain. in the instant case the PEA is not an end user agency with respect to the reclaimed lands under the Amended JVA." Justice Puno emphasized that "Commonwealth Act No. such an "irrevocable option" to purchase government land would now be void being contrary to the requirement of public bidding 17 expressly required in Section 79 of PD No. to hold alienable or even inalienable lands of the public domain. Republic Act No. Fourth. the 27 June 1965 Resolution made the injunction of the trial court against the City of Cebu "permanent insofar x x x as the area outside or beyond the foreshore land proper is concerned. the Ponce Cases involve the authority of the City of Cebu to reclaim foreshore areas pursuant to a general law. As we stated in our 9 July 2002 Decision: In the instant case. 1899. Both the 9 July 2002 Decision and the 6 May 2003 Resolution of this Court in the instant case expressly recognize this. 1899 authorized municipalities and chartered cities to reclaim foreshore lands." As we held in the 1998 case of Republic Real Estate Corporation v. and the land covered by these certificates. the 1973 Constitution prohibited private corporations from acquiring alienable lands of the public domain. With the subsequent enactment of the Government Auditing Code (Presidential Decree No. No one is asking the Director of Lands to cancel PEA’s patent or certificates of title. This Resolution does not prejudice any innocent third party purchaser of the reclaimed lands covered by the Amended JVA. 1899 applies only to foreshore lands." and that such lands "remained property of the State. the only patent and certificates of title issued are those in the name of PEA. and 1987 Constitutions." The instant case involves principally submerged lands within Manila Bay. Congress may by law transfer public lands to the City of Cebu to be used for municipal purposes. Neither the PEA nor Amari has sold any portion of the reclaimed lands to third parties. Obviously. and the 1987 Constitution reiterated this prohibition. Obviously. RA No. 1445. Thus. Clearly. a wholly government owned corporation performing public as well as proprietary functions. the facts in the Ponce Cases are different from the facts in the instant case. and transfer several hundreds of hectares of these reclaimed and still to be reclaimed lands to a single private corporation in only one transaction. in the Ponce Cases the Cebu City ordinance granted Essel. Thus. Article XII of the 1987 Constitution which was intended to diffuse equitably the ownership of alienable lands of the public domain among Filipinos. the Ponce Cases cannot serve as authority for a private corporation to acquire alienable public lands. an "irrevocable option" to purchase from Cebu City not more than 70% of the reclaimed lands. The ownership of the reclaimed lands remained with Cebu City until Essel. PEA will simply turn around.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 89 Second. As we explained in the 6 May 2003 Resolution: 20 PEA is the central implementing agency tasked to undertake reclamation projects nationwide. including private corporations. . 1445) on 11 June 1978. 1899. 1973. any sale of government land must be made only through public bidding. Court of Appeals . 141 has remained in effect at present. On this score. 1445. However. should not be sold to a private corporation. In his concurring opinion inRepublic Real Estate Corporation. (Emphasis supplied) Our 9 July 2002 Decision explained the rationale for treating the PEA in the same manner as the DENR with respect to reclaimed foreshore or submerged lands in this wise: To allow vast areas of reclaimed lands of the public domain to be transferred to PEA as private lands will sanction a gross violation of the constitutional ban on private corporations from acquiring any kind of alienable land of the public domain. which took over the leasing and selling functions of DENR. which were decided based on RA No. the thrust of the instant petition is that PEA’s certificates of title should remain with PEA. In fact. lands so acquired by the City of Cebu for a patrimonial purpose may be sold to private parties. Inc. the ingenious reclamation scheme adopted in the Cebu City ordinance can no longer be followed in view of the requirement of public bidding in the sale of government lands. much less submerged lands. There is no dispute that a public corporation is not covered by the constitutional ban on acquisition of alienable public lands. This requirement of public bidding is reiterated in 18 19 Section 379 of the 1991 Local Government Code. Puno stated that under Commonwealth Act No. (Emphasis supplied) Finally. exercised its option to purchase. being alienable lands of the public domain. the governing constitutional and statutory provisions have changed since the Ponce Cases were disposed of in 1965 and 1966 through minute Resolutions of a divided (6 to 5) Court. Third. Moreover. Cebu City is an end user government agency. The two Resolutions in the Ponce Cases upheld the Cebu City ordinance only with respect to foreshore areas. RA No. reclaimed foreshore (or submerged lands) lands are public lands in the same manner that these same lands would have been public lands in the hands of DENR. the Ponce Cases. In the instant case. The City of Cebu is a public corporation and is qualified. and nullified the same with respect to submerged areas. as PEA has now done under the Amended JVA. since under the present Constitution a private corporation like Amari is barred from acquiring alienable lands of the public domain. just like the Bases Conversion and Development Authority or 21 the Department of Foreign Affairs. Thus. Title to the reclaimed lands remains with the PEA. under the 1935. 141. However. citing the Ponce Cases.

over a 12-month pd. and Corona. records show that P300 million was paid in manager’s checks of Citibank-Makati. see separate(concurring) opinion. see dissenting opinion. J. Triviño.707. JJ.00 127.000. ’95 to 31 Jan. and upon the instruction of Messrs. see separate opinion. SO ORDERED.754.. In this regard.150.J. Austria-Martinez.00 from date of letter When sale of land begins Upon completion of each Phase TOTAL not exceeding 157. 1995 issued by Messrs. Vitug. Article XII of the 1987 Constitution. p. 2) One (1) manager’s check at P7 million. the existence of this report is a matter of judicial notice pursuant to Section 1. we DENIED with FINALITY respondents’ Motions for Reconsideration. Davide. the Amended JVA "violates glaringly Sections 2 and 3. Ynares-Santiago. Coronel and Ellen Tordesillas. without the introduction of evidence. On the basis of a Memorandum Order dated April 28. Mr. as follows: ============== Mr. of x x x the official acts of the legislature. This report won the 1st Prize in the 1998 JVO Investigative Journalism Awards. while the balance of P100 million was deposited to the account of the two Chinese in a Hongkong bank. Emmanuel Sy admitted signing several blank checks as special request from Messrs.00 P1.k. Frank Chua)..000) and (b) pay and deliver to you the following checks: . One (1) manager’s check at P3 million. C.a.000.500.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 90 As we held in our 9 July 2002 Decision. Karnasuta and Emmanuel Sy. Panganiban. 3) Forty (40) blank checks amounting to P357 million. Quisumbing. no part. and stockholders of AMARI namely.. J..363. JJ. p.00 See "The Grandmother of All Scams" by Sheila S. J. maintains previous qualified opinion. Azcuna. 2) Twenty-four (24) blank checks amounting to P150 million dated from 31 August 1995 up to 31 January 1998.00 Monthly. It is now time to write finis to this "Grandmother of All Scams. Sandoval-Gutierrez. Benito Co) and Mr. Bellosillo. J. No further pleadings shall be allowed from any of the parties. on the other. On the first payment of P400 million.000. 18-20 March 1998. the external auditors of AMARI. Litigations must end some time. 2 6 May 2003 Resolution. 5 Senate Committee Report No. a Dominican Republic national. Upon signing of this letter-agreement AMARI shall (a) pay to you (in cash in the form of Bank Manager’s Checks) the sum of Two Hundred Sixty Two Million Five Hundred Thousand Pesos (Pesos 262.050. Sy could not satisfactorily answer why Mr. and. 560.000. the Statement of Facts in Senate Committee Report No. Chin San Cordova (a.k. Premchai Karnasuta and Emmanuel Sy for and in behalf of AMARI. in its Statement of Facts and the Case.. Puno. Luis Benitez of SGV. voted to grant reconsideration. p.000. and..a.500. George Triviño. Neither could he provide information regarding the said Mr. sets forth various payments AMARI paid or agreed to pay the aforesaid stockholders by way of fees for "professional efforts and services in successfully negotiating and securing for AMARI the Joint Venture Agreement". J. 357. 13.. pls. Carpio-Morales. Co and Chua and issuing said checks as follows: 1) Ten (10) Manager’s checks dated 60 days from the June 9 letter amounting to P127 million. and Callejo. the pertinent portion of the 9 June 1995 letter-agreement provides as follows: "3.00 150. Jr. 3 PEA’s Memorandum dated 4 August 1999 quoted extensively. 6 A more detailed discussion on this matter in Senate Report No. the second Motions for Reconsideration filed by Public Estates Authority and Amari Coastal Bay Development Corporation are DENIED for being prohibited pleadings. broken down as follows: 1) Twenty-nine (29) manager’s checks at P10 million each. Rule 129 of the Rules of Court which provides.00 Costing 300. ’98 Amount P 400. pls. 48.000. Chua Hun Siong (a. these Motions for Reconsideration have no merit. see dissenting opinion. Mr. maintains their dissent. All these checks were indorsed by Mr. Footnotes 1 Form of Payment Manager’s Checks Manager’s Checks 10 Post Dated Checks (PDCs) 24 PDCs 48 PDCs Cash bonus Developed land from Project Paid/Payable On 28 April 1995 Upon signing of letter 60 days from date of letter 31 Aug. Moreover. Tinga. Triviño was made payee of the Manager’s Checks when he had nothing to do with the transactions." 4 9 July 2002 Decision. Mr. Triviño..100.844.00 262. 31 manager’s checks in the total amount of P300 million were issued by Citibank-Makati in favor of a Mr. concur. In any event.000.000.. 560 reads as follows: The Commissions A Letter-Agreement dated 09 June 1995 signed by Messrs..000." WHEREFORE. 560 dated 16 September 1997. J. on the one hand. Philippine Center for Investigative Journalism.." In our 6 May 2003 Resolution. testified that said Letter-Agreement was approved by the AMARI Board. Sr. 4. "A court shall take judicial notice. Chin San Cordova and Chua Hun Siong. voted to allow reconsideration.

1996 January 31.250. Manuel Sy: Citibank Check No.863.000.250.000 6.000 6.750.000. Emmanuel Sy: Citibank Check No.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 91 "3. 000047 dated 10/31/96 000049 dated 10/31/96 8.000 6.250.050. 1996 November 30.000 6. and Wee Te Lato.250. International Merchandising and Development Corporation.000 and one (1) check of which shall bear the amount of P8.00 as of 09 June 1995.000 6.000 7.000 12.250.250.250.250. Chin San Cordova: Citibank Check No. 1996 June 30. 1996 July 31.250. 000041 dated 8/31/96 000043 dated 9/30/96 7. 1997 January 31.250. Based on the submitted photocopies of the returned checks issued by AMARI vis-a-vis item 3(b) of the quoted Letter-Agreement. "3.250.050) payable over a period of twelve (12) months as follows: . twenty-one. Chin San Cordova.000).250.000 6.250.250. Sy Pio Lato: Citibank Check No.000 6.000 6. 1997 July 31.000 12.000 6. 1997 June 30.2 Twenty-Four (24) checks in the total amount of One Hundred Fifty Million Pesos (Pesos 150.000 7. nineteen.000 6.000 6. Sy Pio Lato.700.250. seventeen.250.000 P150.000 6.000 6.250.250.000 12. Other payments were made payable to Cash (bearer instruments). 1996 May 31. 000007 dated 8/8/95 3.000 P 6. 1996 September 30. twenty-three." The Provisional Receipt shows that Mr. 1997 September 30.000 6.000 6. EY: Citibank Check No. 1997 December 31.000 7. 1996 April 30.1997 April 30.000 ========== "3. 1998 Total P 6.250.250.250. 1997 October 31.700.000.250. International Merchandising and Development Corporation: Citibank Check No.700. 1997 August 31.000.250. fifteen. 1995 March 31. The last issued check hereunder shall bear the sum of P8.250.250. eighteen.050.700. 1997 February 28.000 6. 1996 October 31.000 7. 1997 March 31.250.250.250.000 6. 1996 August 31. Wee Te Lato: 7. These monthly payment of four (4) checks each shall be dated the last date of the thirteen.000 6.000 6. 1997 May 31.000 "Each monthly payment to consist of Four (4) checks. Manuel Sy. 1996 December 31. Chua Hun Siong received the amount of P896. 000013 dated 4/30/96 000014 dated 5/31/96 000015 dated 6/30/96 000016 dated 7/31/96 000045 dated 9/30/96 5. Golden Star Industrial Corporation.250.000 6.363. 1997 November 30.250. twenty-two. the following persons were made payees: Emmanuel Sy.250. 000019 dated 10/31/96 2.250.000 for a total monthly amount of P29.000 6. and twenty-four months from the date of this letter agreement.363.250. Golden Star Industrial Corporation: Citibank Check No.000 6. twenty.1 Ten (10) checks dated sixty (60) days from date of this letter agreement in the total amount of One Hundred Twenty Seven Million Pesos (Pesos 127.250. 000008 dated 8/8/95 000009 dated 8/8/95 000010 dated 8/8/95 4.000 6.000 6.000 6.250.000) as follows: DUE DATE OF CHECK AMOUNT August 31.000 6. Each person was thus named payee to the following amounts: 1. 000018 dated 9/30/96 6. fourteen. sixteen.000.3 Forty Eight (48) checks in the total amount of Three Hundred Fifty Seven Million Three Hundred Sixty Three Thousand Fifty Pesos (Pesos 357.000 6.250.000 12. three (3) checks of which shall each bear the amount of P7. EY.000 6. Chin San Cordova and Mr.

000 6. with a face value of P6. Ben Cuevo if she knew anybody from PEA.000. Gomez. or his duly authorized representative or that of the Commission on Audit and. Polly Tragico accompanied Mr. Civil Code of the Philippines. Ms. aside from Mr. .000 7. and for introducing the AMARI representative to Mr." For this answer. Mr. Of this P150 million. Under paragraph 2 (a) of COA Circular No. Ben Cuevo and Mr.000. 18 SECTION 379. In the event that the public auction fails. On 6 June 2003 Amari filed a Supplement to its second Motion for Reconsideration. marked as Exhibit 1-Montano IV.250. Montano IV to withdraw funds from Pilipinas Bank-Pavilion.000 Senator Drilon.000 7. Ms. worth P12. it shall upon application of the officer accountable therefor. the same shall be sold at public auction to the highest bidder under the supervision of the committee on awards and in the presence of the provincial. Frank Chua. Concurring and Dissenting.25 million per check. According to him. Montano furthermore admitted that. by notices posted for a like period in at least three public places in the locality where the property is to be sold. upon application of the officer accountable therefor. 9 Decision dated 17 January 1964 of Judge Amador E. 000001 dated 8/8/95 000002 dated 8/8/95 000003 dated 8/8/95 000004 dated 8/8/95 000005 dated 8/8/95 000006 dated 8/8/95 000012 dated 3/31/96 000017 dated 8/31/96 000039 dated 8/31/96 000040 dated 8/31/96 000042 dated 8/31/95 000044 dated 9/30/96 000046 dated 9/30/96 000050 dated 10/31/96 10. Montano. International Merchandising and Development Corporation.000. — When government property has become unserviceable for any cause." a negotiated sale may be resorted to only if "[T]here was a failure of public auction. Amended JVA. or for not less than three consecutive days in any newspaper of general circulation. or is no longer needed. Ben Cuevo admitted to having encashed two checks at Pilipinas Bank.000 7.000 12. Garcia. the property may be sold at a private sale at such price as may be fixed by the same committee or body concerned and approved by the Commission. G.2 (c).000 7. 17 SECTION 79. 15 Section 5.000 8. Aurora Montano. Property Disposal.700. and Fifty thousand pesos (P50.000 6. Amended JVA. shall be destroyed in the presence of the inspecting officer. Ben Cuevo also admitted receiving a check worth P6.000 7.000 12. Bellosillo’s Supplement to Separate Opinion. and the amount was transferred by credit memo to Mr. a certain Ms.700. I know Mr. Amended JVA. Benito Co and in the presence of. 19 Under Section 380 of the 1991 Local Government Code. This was deposited in his Current Account No. on "Sale Thru Negotiation. 13 Section 3.700. but invoked his constitutional right against self-incrimination when asked if he received the amount of P6.000 On the other hand. it shall.000 12. 89-296.2 (a). insisted that she actually received only P10 million. 16 Ibid. Also quoted in Justice Josue N.250. she received P10 million in cash and P20 million in postdated manager’s checks in the office of Mr. 12 Section 3. If found to be valuable.25 million payable to his company. No. Notice of the public auction shall be posted in at least three (3) publicly accessible and conspicuous places. described in the LetterAgreement. 14 Section 2. 25 July 1990. notice of auction shall be published at least two (2) times within a reasonable period in a newspaper of general circulation in the locality. 10 Sections 2 and 3. 21 Laurel v. if found to be valueless or unsalable. the two checks form part of the P150 million worth of post-dated checks (PDCs). 530 (1998).700.250. Justiniano Montano IV. Montano. local governments can sell real property through negotiated sale only with the approval of the Commission on Audit. 000048 dated 10/31/96 9. 20 359 Phil. after advertising by printed notice in the Official Gazette. Ms.R." The Commission on Audit enforces the express requirement in Section 79 of the Government Auditing Code that a negotiated sale is possible only after there is a failure of public auction. indicating the transfer of the amount of P6. and if the acquisition cost exceeds One hundred thousand pesos (P100.000 12.250. a cousin of Mr. Mr. The Pilipinas Bank Credit Advice dated May 6.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 92 Citibank Check No. or where the value of the property does not warrant the expense of publication.25 million transferred to his account. 000011 dated 8/31/96 6. Montano IV’s account at Pilipinas Bank. as the case may be. 604010562-A. 8 Filed on 19 August 2003. Chin San Cordova and Chua Hun Siong in 1994 for this transaction. Bearer Instruments: CASH: Citibank Check No. Mr. Benito Co. it may be sold at public auction to the highest bidder under the supervision of the proper committee on awards or similar body in the presence of the auditor concerned or other duly authorized representative of the Commission. 1996. — When property of any local government unit has become unserviceable for any cause or is no longer needed. 92013. she met Messrs. If found valuable.3 (a). Montano IV admitted that he has an account with Pilipinas Bank.5 million. be inspected and appraised by the provincial. however. In Executive Session. but he was only able to encash 2 checks at P12. Destruction or sale of unserviceable property.000 12. Mr.700. Amended JVA. Justiniano Montano IV.250. be inspected by the head of the agency or his duly authorized representative in the presence of the auditor concerned and. if found valueless or unusable. Mr.000 8. was asked by a Mr.000. 7 Both filed on 26 May 2003.700. Still in Executive Session.250. Once or twice. 11 Article 112 . and she answered: "Yes. it may be destroyed in their presence.2. Ben Cuevo.5 million. 187 SCRA 797.250.00) in the case of provinces and cities.250.00) in the case of municipalities. Article XII of the 1987 Constitution.25 million was presented by 12. Cuevo actually received five (5) PDCs worth P31 million. city or municipal auditor or his duly authorized representative. Payee’s Name Not Legible: Citibank Check No. city or municipal auditor. through Mr.

suspend their concession or disposition until they are again declared open to concession or disposition by proclamation duly published or by Act of the National Assembly. Subject to said control. The President. the Director of Lands shall have direct executive control of the survey. 141* (a) (b) AN ACT TO AMEND AND COMPILE THE LAWS RELATIVE TO LANDS OF THE PUBLIC DOMAIN (c) Mineral lands. being privately owned. or may. For the purpose of their administration and disposition. which administration and disposition shall be governed by the laws at present in force or which may hereafter be enacted. For the purposes of the administration and disposition of alienable or disposable public lands. Alienable or disposable. and regulations consistent with this Act. SECTION 4. or which. The provisions of this Act shall apply to the lands of the public domain. as may be necessary and proper to carry into effect the provisions thereof and for the conduct of proceedings arising under such provisions. SECTION 7. nor those on which a private right authorized and recognized by this Act or any other valid law may be claimed. rules. LANDS TO WHICH IT REFERS. declare lands of the public domain open to disposition before the same have had their boundaries established or been surveyed. AND CLASSIFICATION. DELIMITATION. The Secretary of Agriculture and Commerce shall be the executive officer charged with carrying out the provisions of this Act through the Director of Lands. having been reserved or appropriated. shall from time to time classify the lands of the public domain into — COMMONWEALTH ACT NO. nor appropriated by the Government. who shall act under his immediate control. Lands to Which it Applies. instructions. upon recommendation by the Secretary of Agriculture and Commerce. SECTION 8. Only those lands shall be declared open to disposition or concession which have been officially delimited and classified and. for the same reason. CHAPTER I Short Title of the Act. or other similar purposes Reservations for town sites and for public and quasi-public uses. The short title of this Act shall be "The Public Land Act. the President. have ceased to be so However. and TITLE I TITLE AND APPLICATION OF THE ACT. with the approval of the Secretary of Agriculture and Commerce shall prepare and issue such forms. surveyed.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 93 November 7. shall from time to time declare what lands are open to disposition or concession under this Act. SECTION 2. have reverted to or become the property of the Commonwealth of the Philippines. according to the use or purposes to which such lands are destined. Delimitation. for the purposes of their administration and disposition. and Officers Charged With Its Execution SECTION 1. Timber. and which have not been reserved for public or quasi-public uses. when practicable. sale or any other form of concession or disposition and management of the lands of the public domain. and his decisions as to questions of fact shall be conclusive when approved by the Secretary of Agriculture and Commerce. lease. classification. the lands of the public domain alienable or open to disposition shall be classified. for reasons of public interest. AND SURVEY — THEREOF FOR CONCESSION and may at any time and in a like manner transfer such lands from one class to another. 1936 CHAPTER II Classification. SECTION 9. SECTION 5. nor in any manner become private property. charitable. upon the recommendation of the Secretary of Agriculture and Commerce. The Director of Lands. SECTION 3. for the Concession Thereof SECTION 6. but timber and mineral lands shall be governed by special laws and nothing in this Act provided shall be understood or construed to change or modify the administration and disposition of the lands commonly called "friar lands'' and those which. the President may. 1936 December 1. as follows: (a) (b) (c) (d) Agricultural Residential commercial industrial or for similar productive purposes Educational. . and Survey of Lands of the Public Domain.

. and no person to whom a homestead patent has been issued by virtue of the provisions of this Act regardless of the area of his original homestead. otherwise he shall lose his prior right to the land. Within six months from and after the date of the approval of the of the application. "'disposition. In case of delinquency of the applicant. it shall be proven to the satisfaction of the Director of Lands. sixty days after such delinquency has occurred.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 94 The President. No certificate shall be given or patent issued for the land applied for until at least one-fifth of the land has been improved and cultivated. if he finds that the application should be approved. the description of the land. who does not own more than twenty-four hectares of land in the Philippines or has not had the benefit of any gratuitous allotment of more than twenty-four hectares of land since the occupation of the Philippines by the United States. together with his previous homestead shall not exceed an area of twenty-four hectares. the Director of Lands. Public lands suitable for agricultural purposes can be disposed of only as follows. after due notice to the homesteader. The words "alienation. shall do so and authorize the applicant to take possession of the land upon the payment of five pesos. or benefit of the lands of the public domain other than timber or mineral lands. That any previous homesteader who has been issued a patent for less than twenty-four hectares and otherwise qualified to make a homestead entry. notify the Director of Lands as soon as he is ready to acquire the title. upon the payment of five pesos. SECTION 10. payment of the fees required in this chapter may be made to the municipal treasurer of the locality. and not otherwise: (1) (2) (3) (4) For homestead settlement By sale By lease By confirmation of imperfect or incomplete titles: (a) (b) By judicial legalization By administrative legalization (free patent). within the said period. SECTION 15. who. the Director of Lands may. At the option of the applicant. or has otherwise failed to comply with the requirements of this Act. as final fee. lease. may be allowed another homestead which. as prescribed by the Secretary of Agriculture and Commerce shall be given to the public of his intention to make such proof. may enter a homestead of not exceeding twentyfour hectares of agricultural land of the public domain. If at the date of such notice. and the time and place at which. then. the names of the witness by whom it is expected that the necessary facts will be established. and shall make affidavit that no part of said land has been alienated or encumbered. and may. such proof will be made. SECTION 14. shall from time to time make the classifications provided for in this section. or the head of a family. the applicant shall prove to the satisfaction of the Director of Lands. SECTION 12. and has cultivated at least one-fifth of the land continuously since the approval of the application. he shall be entitled to a patent. SECTION 19. TITLE II Agricultural Public Lands CHAPTER III Forms of Concession of Agricultural Lands SECTION 11. SECTION 17. and the name of the officer before whom. Provided. Before final proof shall be submitted by any person claiming to have complied with the provisions of this chapter. Philippine currency. shall mean any of the methods authorized by this Act for the acquisition. In case the homesteader shall suffer from mental alienation. from and after the date of the approval of the application. The applicant shall. the applicant shall begin to work the homestead. Upon the filing of an application for a homestead. The period within which the land shall be cultivated shall not be less than one or more than five years. at any time and in a similar manner. Not more than one homestead entry shall be allowed to any one person. Any citizen of the Philippines over the age of eighteen years. and that he has complied with all the requirements of this Act. with its boundaries and area. either cancel the application or grant an extension of time not to exceed one hundred and twenty days for the payment of the sum due. may again acquire a homestead. the person legally representing him may offer and submit the final proof on behalf of such incapacitated person. upon recommendation by the Secretary of Agriculture and Commerce. transfer lands from one class to another. the Director of Lands may cancel the entry. stating therein the name and address of the homesteader. SECTION 18. as entry fee. in turn. shall forward them to the provincial treasurer. however. that the land entered is under the law not subject to home-stead entry. or shall for any other reason be incapacitated from exercising his rights personally. use. or that the homesteader has actually changed his residence. or in a municipality adjacent to the same. due notice. that he has resided continuously for at least one year in the municipality in which the land is located. or "concession" as used in this Act. SECTION 13. If at any time before the expiration of the period allowed by law for the making of final proof. or voluntarily abandoned the land for more than six months at any one time during the years of residence and occupation herein required. SECTION 16.

and if such cultivation has not been begun within six months from and after the date on which the permit was received. or partnerships were qualified under the last preceding section. Public agricultural lands which are not located within ten (10) kilometers from the boundaries of the city proper in chartered cities or within five (5) kilometers from the municipal hall or town occupants plaza of any municipality may be sold to actual occupants who do not own any parcel of land or whose total land holdings do not exceed five hectares and who comply with the minimum requirements of Commonwealth Act numbered one hundred forty-one. associations or partnerships which. on the land itself. respectively. association. treasury warrant. held agricultural public lands or land of any other denomination. If at the expiration of this term or at any time prior thereto. associations. SECTION 24. or post-office money order payable to the order of the Director of Lands for ten per centum of the amount of the bid. and which is organized and constituted under the laws of Philippines. and in two newspapers one published in Manila and the other published in the municipality or in the province where the lands are located. he shall have the priority. SECTION 23. SECTION 21. and corporate bodies organized in the Philippines authorized under their charters to do so. The Director of Lands shall announce the sale thereof by publishing the proper notice once a week for six consecutive weeks in the Official Gazette. corporations. corporations. or partnership other than those mentioned in the last preceding section may acquire or own agricultural public land or land of any other denomination or classification. The permit shall be for a term of one year. not to exceed one hundred and forty-four hectares in the case of an individual and one thousand and twenty-four hectares in that of a corporation or association. the area of which shall not exceed four hectares. In addition to existing publication requirements in section twenty-four of Commonwealth Act Numbered one hundred forty-one. and that the conveyance is not made for purposes of speculation. and immediately after such transfer. however. the publication in the Official Gazette and newspapers may be omitted. That persons. otherwise the land shall be again open to disposition at the expiration of the permit. Any citizen of lawful age of the Philippines. and shall fix a date not earlier than sixty days after the date of the notice upon which the land will be awarded to the highest bidder. which is at the time or was originally. If at any time after the approval of the application and before the patent is issued. For each permit the sum of one peso shall be paid. notices and of applications shall be posted for a CHAPTER IV Sale SECTION 22. where the land is located. or any permanent improvement thereon. corporation. really or presumptively. convey. shall be authorized to continue holding the same as if such persons. Every transfer made without the previous approval of the Director of Lands shall be null and void and shall result in the cancellation of the entry and the refusal of the patent. and. cdt All bids must be sealed and addressed to the Director of Lands and must have inclosed therewith cash or certified check. then the applicant. duly legalized and acknowledged by competent courts. and in the most conspicuous place in the provincial building and the municipal building of the province and municipality. or a real right upon such lands and Constitution took improvements. really or presumptively. Lands sold under the provisions of this chapter must be appraised in accordance with section one hundred and sixteen of this Act. except by reason of hereditary succession. desiring to live upon or occupy land on any of the reservations set aside for the so-called "non-Christian tribes" may request a permit of occupation for any tract of land of the public domain reserved for said nonChristian tribes under this Act. or permanent improvements on such lands. SECTION 25. with the previous approval of the Director of Lands may transfer his rights to the land and improvements to any person legally qualified to apply for a homestead. but if the value of the land does not exceed two hundred and forty pesos. . or any real right on such land and improvement: Provided. at the date upon which the Philippine Constitution took effect. It shall be an essential condition that the applicant for the permit cultivate and improve the land. or alienate the same to persons. through no fault of his own. No person. or partnerships not included in section twenty-two of this Act. and who have resided on the land applied for at least two years prior to the date of the application. including the portion for which a permit was granted to him. corporations. associations. That partnerships shall be entitled to purchase not to exceed one hundred and forty-four hectares for each member thereof. That no bid shall be considered the amount of which is less than the appraised value of the land. of the public domain. as amended. and there is a bona fide purchaser for the rights and improvements of the applicant on the land. and any such citizen not of lawful age who is a head of a family. the permit shall be cancelled. and any corporation or association of which at least sixty per centum of the capital stock or of any interest in said capital stock belongs wholly to citizens of the Philippines. or other action will be taken as provided in this chapter. that belonged originally. the purchaser shall file a homestead application for the land so acquired and shall succeed the original homesteader in his rights and obligations beginning with the date of the approval of said application of the purchaser. the holder of the permit shall apply for a homestead under the provisions of this chapter. which amount shall be retained in case the bid is accepted as part payment of the purchase price: Provided. may purchase any tract of public agricultural land disposable under this Act.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 95 SECTION 20. the applicant shall prove to the satisfaction of the Director of Lands that he has complied with all the requirements of the law. Any person who has so transferred his rights may not again apply for a new homestead. or public bids will be called for. but cannot continue with his homestead. having acquired the same under the laws and regulations in force at the date of such acquisition. as amended. if practicable. or in a neighboring province. Any non-Christian Filipino who has not applied for a home-stead. by proceeding as prescribed in this chapter: Provided. but they shall not encumber. and the same notice shall be posted on the bulletin board of the Bureau Of Lands in Manila. to the public domain. The notices shall be published one in English and the other in Spanish or in the local dialect. but the total area so purchased shall in no case exceed the one thousand and twenty-four hectares authorized in this section for associations and corporations.

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period of not less than thirty days in at least three conspicuous places in the municipality where the parcel of land is located, one of which shall be at the municipal building, and other, in the barrio council building of the barrio where the land is located. SECTION 26. Upon the opening of the bids, the land shall be awarded to the highest bidder. If there are two or more equal bids which are higher than the others, and one of such equal bids is that of the applicant, his bid shall be accepted. If, however, the bid of the applicant is not one of such equal and higher bids, the Director of Lands shall at once submit the land for public bidding, and to the person making the highest bid on such public auction the land shall be awarded. In any case, the applicant shall always have the option of raising his bid to equal that of the highest bidder, and in this case the land shall be awarded to him. No bid received at such public auction shall be finally accepted until the bidder shall have deposited ten per centum of his bid, as required in Section twenty-five of this Act. In case none of the tracts of land that are offered for sale or the purchase of which has been applied for, has an area in excess of twenty-four hectares, the Director of Lands may delegate to the District Land Officer concerned the power of receiving bids, holding the auction, and proceeding in accordance with the provisions of this Act, but the District Land Officer shall submit his recommendation to the Director of Lands, for the final decision of the latter in the case. The District Land Officer shall accept and process any application for the purchase of public lands not exceeding five hectares subject to the approval of the Director of Lands within sixty days after receipt of the recommendation of said District Land Officer. SECTION 27. The purchase price shall be paid as follows: The balance of the purchase price after deducting the amount paid at the time of submitting the bid, may be paid in full upon the making of the award, or in not more than ten equal annual installments from the date of the award. SECTION 28. The purchaser shall have not less than one-fifth of the land broken and cultivated within five years after the date of the award; and before any patent is issued, the purchaser must show of occupancy, cultivation, and improvement of at least one-fifth of the land applied for until the date on which final payment is made: Provided, however, That in case land purchased is to be devoted to pasture, it shall be sufficient compliance with this condition if the purchaser shall graze on the land as many heads of his cattle as will occupy at least one-half of the entire area at the rate of one head per hectare. SECTION 29. After title has been granted, the purchaser may not, within a period of ten years from such cultivation or grant, convey or encumber or dispose said lands or rights thereon to any person, corporation or association, without prejudice to any right or interest of the Government in the land: Provided, That any sale and encumbrance made in violation of the provisions of this section, shall be null and void and shall produce the effect of annulling the acquisition and reverting the property and all rights thereto to the State, and all payments on the purchase price theretofore made to the Government shall be forfeited. SECTION 30. If at any time after the date of the award and before the issuance of patent, it is proved to the satisfaction of the Director of Lands, after due notice to the purchaser, that the purchaser has voluntarily abandoned the land for more than one year at any one time, or has otherwise failed to comply with the requirements of the law, then the land shall revert to the State, and all prior payments made by the purchaser and all improvements existing on the land shall be forfeited. SECTION 31. No person, corporation, association, or partnership shall be permitted, after the approval of this Act, to acquire the title to or possess as owner any lands of the public domain if such lands, added to other lands belonging to such person, corporation, association, or partnership shall give a total area greater than area the acquisition of which by purchase is authorized under this Act. Any excess in area over this maximum and all right, title, interest, claim or action held by any person, corporation, association, or partnership resulting directly or indirectly in such excess shall revert to the State. This section shall, however, not be construed to prohibit any person, corporation, association, or partnership authorized by this Act to require lands of the public domain from making loans upon real necessary for the recovery of such loans; but in this case, as soon as the excess above referred to occurs, such person, corporation, association, or partnership shall dispose of such lands within five years, for the purpose of removing the excess mentioned. Upon the land in excess of the limit there shall be paid, so long as the same is not disposed of, for the first year a surtax of fifty per centum additional to the ordinary tax to which such property shall be subject, and for each succeeding year fifty per centum shall be added to the last preceding annual tax rate, until the property shall have been disposed of. The person, corporation, association, or partnership owning the land in excess of the limit established by this Act shall determine the portion of land to be segregated. At the request of Secretary of Agriculture and Commerce, the Solicitor-General or the officer acting in his stead shall institute the necessary proceedings in the proper court for the purpose of determining the excess portion to be segregated, as well as the disposal of such portion in the exclusive interest of the Government. SECTION 32. This chapter shall be held to authorize only one purchase of the maximum amount of land hereunder by the same person, corporation, association, or partnership; and no corporation, association, or partnership, any member of which shall have received the benefits of this chapter or of the next following chapter, either as an individual or as a member of any other corporation, association, or partnership, shall purchase any other lands of the public domain under this chapter. But any purchaser of public land, after having made the last payment upon and cultivated at least one-fifth of the land purchased, if the same shall be less than the maximum allowed by this Act, may purchase successively additional agricultural public land adjacent to or not distant from the land first purchased, until the total area of such purchases shall reach the maximum established in this chapter: Provided, That in making such additional purchase or purchases, the same conditions shall be complied with as prescribed by this Act for the first purchase.

CHAPTER V

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Lease SECTION 33. Any citizen of lawful age of the Philippines, and any corporation or association of which at least sixty per centum of the capital stock or of any interest in said capital stock belongs wholly to citizens of the Philippines, and which is organized and constituted under the laws of the Philippines, may lease any tract of agricultural public land available for lease under the provisions of this Act, not exceeding a total of one thousand and twenty-four hectares. If the land leased is adapted to and be devoted for grazing purposes, an area not exceeding two thousand hectares may be granted. No member, stockholder, of officer, representative, attorney, agent, employee or bondholder of any corporation or association holding or controlling agricultural public land shall apply, directly or indirectly, for agricultural public land except under the homestead and free patent provisions of this Act: Provided, That no lease shall be permitted to interfere with any prior claim by settlement or occupation, until the consent of the occupant or settler is first had, or until such claim shall be legally extinguished, and no person, corporation, or association shall be permitted to lease lands hereunder which are not reasonably necessary to carry on his business in case of an individual, or the business for which it was lawfully created and which it may lawfully pursue in the Philippines, if an association or corporation. SECTION 34. A notice of the date and place of the auction of the right to lease the land shall be published and announced in the same manner as that prescribed for the publication and announcement of the notice of sale, in section twenty-four of this Act. SECTION 35. All bids must be sealed and addressed to the Director of Lands and must have enclosed therewith cash or a certified check, Treasury warrant, or post-office money order payable to the order of the Director of Lands, for a sum equivalent to the rental for at least, the first three months of the lease: Provided, That no bid shall be considered in which the proposed annual rental is less than three per centum of the value of the land according to the appraisal made in conformity with section one hundred and sixteen of this Act. SECTION 36. The auction of the right to lease the land shall be conducted under the same procedure as that prescribed for the auction sale of agricultural lands as described in section twentysix of this Act: Provided, That no bid shall be accepted until the bidder shall have deposited the rental for at least the first three months of the lease. SECTION 37. The annual rental of the land leased shall not be less than three per centum of the value of the land, according to the appraisal and reappraisal made in accordance with section one hundred sixteen of this Act; except for lands reclaimed by the Government, which shall not be less than four per centum of the appraised and reappraised value of the land: Provided, That one-fourth of the annual rental of these lands reclaimed prior to the approval of this Act shall accrue to the construction and improvement portion of the Portworks Funds: And provided, further, That the annual rental of not less than four per centum of the appraised and reappraised value of the lands reclaimed using the Portworks Fund after the approval of this Act shall all accrue to the construction and improvement portion of the Portworks Fund. But if the land leased is adapted to and be devoted for granting purposes, the annual rental shall be not less than two per centum of-the appraised and reappraised value thereof- Every contract of lease under the provisions of this chapter shall contain a cause to the effect that are appraisal of the land leased shall be made every ten years from the date of the approval of the lease, if the term of the same shall be in excess of ten years. In case the lessee is not agreeable to the reappraisal and prefers to give up his contract of lease, he shall notify the Director of Lands of his desire within the six months next preceding the date on which the reappraisal takes effect, and in case his request is approved, the Director of Lands may, if the lessee should so desire, proceed in accordance with section one hundred of this Act. SECTION 38. Leases shall run for a period of not more than twenty-five years, but may be renewed once for another period of not to exceed twenty-five years, in case the lessee shall have made important improvements which, in the discretion of the Secretary of Agriculture and Commerce justify a renewal. Upon the final expiration of the lease, all buildings and other permanent improvements made by the lessee, his heirs, executors, administrators, successors, or assigns shall become the property of the Government, and the land together with the said improvements shall be disposed of in accordance with the provisions of chapter five of this Act. SECTION 39. It shall be an inherent and essential condition of the lease that the lessee shall have not less than one-third of the land broken and cultivated within five years after the date of the approval of the lease: Provided, however, That in case the land leased is to be devoted to pasture, it shall be sufficient compliance with this condition if the lessee shall graze on the land as many heads of cattle as will occupy at least one-half of the entire area at the rate of one head per hectare. SECTION 40. The lessee shall not assign, encumber, or sublet his rights without the consent of the Secretary of Agriculture and Commerce, and the violation of this condition shall avoid the contract: Provided, That assignment, encumbrance, or subletting for purposes of speculation shall not be permitted in any case: Provided, further, That nothing contained in this section shall be understood or construed to permit the assignment, encumbrance, or subletting of lands leased under this Act, or under any previous Act, to persons, corporations, or associations which under this Act, are not authorized to lease public lands. SECTION 41. The lease of any lands under this chapter shall not confer the right to remove or dispose of any valuable timber except as provided in the regulations of the Bureau of Forestry for cutting timber upon such lands. Nor shall such lease confer the right to remove or dispose of stone, oil, coal, salts. or other minerals, or medicinal mineral waters existing upon the same. The lease as to the part of the land which shall be mineral may be canceled by the Secretary of Agriculture and Commerce, after notice to the lessee, whenever the said part of the land is more valuable for agricultural purposes. The commission of waste or violation of the forestry regulations by the lessee shall work a forfeiture of his last payment of rent and render him liable to immediate dispossession and suit for damage. SECTION 42. After having paid rent for at least the first two years of the lease, and having complied with the requirements prescribed in section thirty nine, the lessee of agricultural public land with an area than the maximum allowed by law, may lease successively additional agricultural public land adjacent to or near the land originally leased until the total- area of such leases shall reach

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the maximum established in this chapter: Provided, That in making such additional lease, the same conditions shall be complied with as prescribed by this Act for the first lease. SECTION 43. During the life of the lease, any lessee who shall have complied with all the conditions thereof and shall have the qualifications required by section twenty-two, shall have the option of purchasing the land leased subject to the restrictions of chapter five of this Act. city council and barangay council affected, and copies thereof shall be posted on the bulletin board of the Bureau of Lands at Manila and at conspicuous places in the provincial building and at the municipal building and barangay hall or meeting place. It shall moreover, be announced by government radio whenever available, in each of the barrios of the municipality. SECTION 46. If, after the filing of the application and the investigation, the Director of Lands shall be satisfied of the truth of the allegations contained the application and that the applicant comes within the provisions chapter, he shall cause a patent to issue to the applicant or his legal successor for the tract so occupied and cultivated, provided its area does not exceed twenty-four hectares: Provided, That no application shall be finally acted upon until notice thereof has been published in the municipality and barrio in which the land is located and adverse claimants have had an opportunity to present their claims.

CHAPTER VI Free Patents SECTION 44. Any natural-born citizen of the Philippines who is not the owner of more than twenty-four hectares and who since July fourth, nineteen hundred and twenty-six or prior thereto, has continuously occupied and cultivated, either by himself or through his predecessors-in-interest, a tract or tracts of agricultural public lands subject to disposition, or who shall have paid the real estate tax thereon while same has not been occupied by any person shall be entitled, under the provisions of this chapter, to have a free patent issued to him for such tract or tracts of such land not to exceed twenty-four hectares. A member of the national cultural minorities who has continuously occupied and cultivated, either by himself or through his predecessors-in-interest, a tract or tracts of land, whether disposable or not since July 4, 1955, shall be entitled to the right granted in the preceding paragraph of this section: Provided, That at the time he files his free patent application he is not the owner of any real property secured or disposable under this provision of the Public Land Law SECTION 45. The President of the Philippines (Prime Minister), upon recommendation of the Secretary of Natural Resources, shall from time to time fix by proclamation the period which applications for Proclamation free patents may be filed in the district, chartered city, of period province, municipality or region specified in such proclamation, and upon the expiration of the period so designated, unless the same be extended by the President (Prime Minister) all the land comprised within such district, chartered city, province, municipality or region subject thereto under the provisions of this chapter may be disposed of as agricultural public land without prejudice to the prior right of the occupant and cultivator to acquire such land under this Act by means other than free patent. The time to be fixed in the entire Archipelago for the filing of applications under this Chapter shall not extend beyond December 31, 1987, except in the provinces of Agusan del Norte, Agusan del Sur, Cotabato, South Cotabato, Bukidnon, Lanao del Norte, Lanao del Sur, Davao del Norte, Davao del Sur, Davao Oriental, Sulu, Mt. Province, Benguet, Kalinga-Apayao, and Ifugao where the President of the Philippines, upon recommendation of the Secretary of Natural Resources, shall determine or fix the time beyond which the filing of applications under this Chapter shall not extend. The period fixed for any district, chartered city, province, or municipality shall begin to run thirty days after the publication of the proclamation in the Official Gazette and if available in one newspaper of general circulation in the city, province or municipality concerned. A certified copy of said proclamation shall be furnished by the Secretary of Natural Resources within 30 days counted from the date of the presidential proclamation to the Director of Lands and to the provincial board, the municipal board or

CHAPTER VII Judicial Confirmation of Imperfect or Incomplete Titles SECTION 47. The persons specified in the next following section are hereby granted time, not to extend beyond December 31, 1987 within which to take advantage of the benefit of this chapter: Provided, That this extension shall apply only where the area applied for does not exceed 144 hectares. Provided, further, That the several periods of time designated by the President in accordance with section forty-five of this Act shall apply also to the lands comprised in the provisions of this chapter, but this section shall not be construed as prohibiting any of said persons from acting under this chapter at any time prior to the period fixed by the President. SECTION 48. The following-described citizens of the Philippines, occupying lands of the public domain or claiming to own any such lands or an interest therein, but whose titles have not been perfected or completed, may apply to the Court of First Instance of the province where the land is located for confirmation of their claims and the issuance of a certificate of title therefor, under the Land Registration Act , to wit: (a) Those who prior to the transfer of sovereignty from Spain to the prior United States have applied for the purchase, composition or other form of grant of lands of the public domain under the laws and royal decrees then in force and have instituted and prosecuted the proceedings in connection therewith, but have with or without default upon their part, or for any other cause, not received title therefor, if such applicants or grantees and their heirs have occupied and cultivated said lands continuously since the filing of their applications. (b) Those who by themselves or through their predecessors in interest have been in open, continuous, exclusive, and notorious possession and occupation of agricultural lands of the public domain, under a bona fide claim of acquisition or ownership, for at least thirty years immediately preceding the filing of the application for confirmation of title except

the extent of the compliance with the conditions required by the Spanish laws and royal decrees for the acquisition of legal title. In cadastral proceedings. together with a plan of the lands claimed. if any. and under the conditions of the grant then contemplated. and the nature of the inclosure. who may appear as a party in such cases: Provided. the reason for such noncompliance. but would have involved payment therefor to the Government. SECTION 53. claimant. in order that he may. or occupant is open to discussion. or if the person who might be entitled to the same lacks the qualifications required by this Act for acquiring agricultural land of the public domain. possessor. claimant. in any proceedings under this chapter to secure registration of an incomplete or imperfect claim of title initiated prior to the transfer of sovereignty from Spain to the United States. the conveyance of such land to the applicant would not have been gratuitous. If in the hearing of any application arising under this chapter the court shall find that more than one person or claimant has an interest in the land. shall be immediately forwarded to the Director of Lands. and shall be accompanied by a plan of the land and all documents evidencing a right on the part of the applicant to the land claimed. or occupant of any land who shall not have voluntarily come in under the provisions of this chapter or of the Land Registration Act. must in every case present an application to the proper Court of First Instance. continuous. after decreeing in whom title should vest. or that the boundaries of any such land which has not been brought into court as aforesaid are open to question. it shall specify as exactly as possible the date and form of application for purchase composition or other form of grant. possessor.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 99 when prevented by war or force majeure. together with a statement of the length of time such land or any portion thereof has been actually occupied by the claimant or his predecessors in interest. SECTION 55. except that a notice of all such applications. the use made of the land. whenever in the opinion of the President the public interests shall require it. The judicial proceedings under this section shall be in accordance with the laws on adjudication of title in cadastral proceedings. The application shall conform as nearly as may be in its material allegations to the requirements of an application for registration under the Land Registration Act. instead of an application. and praying that the title to any such land or the boundaries thereof or the right to occupancy thereof be settled and adjudicated. but if none of said person is entitled to the land. Such judgment shall be certified to the Director of Lands by the clerk of the court for collection of the amount due from the person entitled to conveyance. the clerk of the court concerned shall certify that fact to the Director . whether disposable or not. or that it is advisable that the title to such lands be settled and adjudicated. The fees provided to be paid for the registration of lands under the Land Registration Act shall be collected from applicants under this chapter. Whenever any judgment of confirmation or other decree of the court under this chapter shall become final. SECTION 54. an answer or claim may be filed with the same effect as in the procedure provided in the last preceding two sections. SECTION 51. claiming any lands or interest in lands under the provisions of this chapter. If said person shall fail to pay the amount of money required by the decree within a reasonable time fixed in the same. These shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of this chapter. SECTION 50. Upon payment to the Director of Lands of the price specified in the judgment. it shall appear that had such claims been prosecuted to completion under the laws prevailing when instituted. The application shall also state the citizenship of the applicant and shall set forth fully the nature of the claim and when based upon proceeding initiated under Spanish laws. to cause to be filed in the proper Court of First Instance. if he deems it advisable for the interests of the Government. It shall be lawful for the Director of Lands. through the Solicitor-General or the officer acting in his stead. SECTION 56. No person claiming title to lands of the public domain not possession of the qualifications specified in the last preceding section may apply for the benefits of this chapter. all of the papers in said case shall be transmitted papers by the clerk to the Solicitor General or officer acting in his stead. or their legal representatives or successors in right. then and in that event the court shall. he shall so certify to the proper Court of First Instance and said court shall forthwith order the registration of the land in favor of the competent person entitled thereto. Applications for registration under this chapter shall be heard in the Court of First Instance in the same manner and shall be subject to the same procedure as established in the Land Registration Act for other applications. Whenever. The Solicitor-General shall return such papers to the clerk as soon as practicable within three months. That prior to the publication for hearing. the court shall order the proceeding to stand dismissed and the title to the land shall then be in the State free from any claim of the applicant. the decision shall be in favor of the Government. Any person or persons. praying that the validity of the alleged title or claim be inquired into and that a certificate of title be issued to them under the provisions of the Land Registration Act. (c) Members of the national cultural minorities who by themselves or through their predecessors-in-interest have been in open. such conflicting interests shall be adjudicated by the court and decree awarded in favor of the person or persons entitled to the land according to the laws. investigate all of the facts alleged in the application or otherwise brought to his attention. exclusive and notorious possession and occupation of lands of the public domain suitable to agriculture. stating in substance that the title of such holder. and if not fully complied with. SECTION 52. a petition against the holder. The final decree of the court shall in every case be the basis for the original certificate of title in favor of the person entitled to the property under the procedure prescribed in section forty-one of the Land Registration Act. SECTION 49. further determine the amount to be paid as a condition for the registration of the land. under a bona fide claim of ownership for at least 30 years shall be entitled to the rights granted in sub-section (b) hereof.

transfers made to a province. donations. as soon as the President. The leases executed under this chapter by the Secretary of Agriculture and Commerce shall. (d) Lands not included in any of the foregoing classes. Commerce and Industry SECTION 58. municipality. in the judgment of the Secretary of Agriculture and Natural Resources. No title or right to. with a certified copy of the decree of confirmation or judgment of the court and the plan and technical description of the land involved in the decree or judgment of the court. corporation. to any person. (b) The land rented and the improvements thereon shall be reappraised every ten years if the term of the lease is in excess of that period. but the lease granted shall only-be valid while such land is used for the purposes referred to. as the case may be. industrial. except for lands reclaimed by the Government which shall not be less than four per centum of the appraised or reappraised value of the land plus two per centum of the appraised or reappraised value of the improvements thereon: Provided. further. with the necessary streets and alley-ways between them. shall declare that the same are not necessary for the public service and are open to disposition under this chapter. and is open to disposition or concession. association or partnership disqualified from purchasing public land for agricultural purposes under the provisions of this Act. That twentyfive per centum of the total annual rental on all lands reclaimed prior to the approval of this Act and one per centum of the appraised or reappraised value of improvements shall accrue to the construction and improvement portion of the Portworks Fund: And provided. among other conditions. for the purpose stated in the notice and subject to the conditions specified in this chapter. The lands comprised in classes (a). contain the following: (a) The rental shall not be less than three per centum of the appraised or reappraised value of the land plus one per centum of the appraised or reappraised value of the improvements. The lands reclaimed by the Government by dredging. encumbered. or otherwise disposed of in a manner affecting its title. SECTION 63. or equity in.That the annual rental on lands reclaimed using the Portworks Fund together with the fee due on account of the improvement thereon after the effectivity of this Act shall all accrue to the construction and improvement portion of the Portworks Fund. shall be disposed of under the pro-visions of this chapter and not otherwise. Upon receipt of such authority. that the lots or blocks not needed for public purposes shall be leased for commercial or industrial or other similar purposes. SECTION 64. be divided by the Director of Lands into lots and blocks. or under or by virtue of any law in effect prior to American occupation. except when authorized by . Any tract of land of the public domain which. but the land so granted donated. municipality or branch or subdivision of the Government for the purposes deemed by said entities conducive to the public interest. or other means. (b). and (c) of section fifty-nine shall be disposed of to private parties by lease only and not otherwise. That any person. that the Government will lease or sell. The area of the land so leased or sold shall be such as shall. That this limitation shall not apply to grants. with the approval of the Secretary of Agriculture and Commerce.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 100 of Lands. or transferred to a province. SECTION 62. the lots or blocks specified in the advertisement. as the case may be. or association authorized to purchase or lease public lands for agricultural purposes. and said Director shall give notice to the public by publication in the Official Gazette or by other means. SECTION 60. upon recommendation by the Secretary of Agriculture and Commerce. corporation. be reasonably necessary for the purposes for which such sale or lease is requested. Commercial or Industrial Purposes and Other Similar Purposes CHAPTER VIII Classification and Concession of Public Lands Suitable for Residence. TITLE III Lands for Residential. and shall in no case exceed one hundred and forty-four hectares: Provided. except as expressly provided by laws enacted after said occupation of the Philippines by the United States. any lands of the public domain may hereafter be acquired by prescription or by adverse possession or occupancy. filling or otherwise shall be surveyed and may. the Director of Lands shall give notice by public advertisement in the same manner as in the case of leases or sales of agricultural public land. Congress: Provided. is intended to be used for residential purposes or for commercial. further. Foreshore. SECTION 61. may lease land included under this title suitable for industrial or residential purposes. the Director of Lands shall ask the Secretary of Agriculture and Commerce for authority to dispose of the same. SECTION 57. or other productive purposes other than agricultural. The lands included in class (d) may be disposed of by sale or lease under the provisions of this Act. or branch or subdivision of the Government shall not be alienated. being neither timber nor mineral land. The lands disposable under this title shall be classified as follows: (a) (b) Lands reclaimed by the Government by dredging. (c) Marshy lands or lands covered with water bordering upon the shores or banks of navigable lakes or rivers. filing. Any tract of land comprised under this title may be leased or sold. Whenever it is decided that lands covered by this chapter are not needed for public purposes. SECTION 59. however.

not to exceed ten.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 101 (c) The term of the lease shall be as prescribed by section thirty-eight of this Act. for other lands belonging to private parties. exchange. or other branch or subdivision of the Government shall need any portion of the land of the public domain open to concession for educational. municipality. and the annual submission to the Government for approval of all tariffs of such rates and fees. university. administrators. all improvements made by the lessee. or . SECTION 65. among others. (b) The purchase price shall be paid in cash or in equal annual installments. upon recommendation by the Secretary of Agriculture and Commerce. The Secretary of Agriculture and Commerce may. except when the public service requires their being leased or exchanged. the area to be such as may actually and reasonably be necessary to carry out such purpose. The violation of one or any of the conditions specified in the contract shall give rise to the rescission of said contract. lease. and shall complete the construction of said improvements within eighteen months from the date of such award. However. (d) The lessee shall construct permanent improvements appropriate for the purpose for which the lease is granted. but the Secretary of Agriculture and Commerce may waive the conditions requiring cultivation. if conveyance he sees fit. Charitable. SECTION 66. and Other Similar Purposes SECTION 69. the President. or assigns shall become the property of the Government. or extend the time within which the construction of the improvements shall be commenced and completed. may execute contracts in favor of the same. or other institutions for educational. Charitable. the sale or lease shall be made by sealed bidding as prescribed in section twenty-six of this Act. but land so granted shall in no case be encumbered or alienated. TITLE IV Lands for Educational. otherwise the Secretary of Agriculture and Natural Resources may rescind the contract. the provisions of which shall be applied wherever applicable. (f) The regulation of all rates and fees charged to the public. The sale of the lands comprised in classes (c) and (d) of section fifty-nine shall. charitable or other similar purposes. where an applicant has made improvements on the land by virtue of a permit issued to him by competent authority. successors. The Secretary of Agriculture and Commerce. in case they are constructions or improvements which if by the Government. charitable or philanthropical purposes or scientific research. The lease or sale shall be made through oral bidding. (h) Subjection to all easements and other rights acquired by the owners of lands bordering upon the foreshore or marshy land. college. Whenever any province. shall be subject to the approval of the Secretary of Public Works and Communications. under terms and conditions to be inserted in the contract. but not to exceed ninety-six hectares in any case. would properly have to be executed under the supervision of the Bureau of Public Works. in his judgment. the Director of Lands shall from time to time announce in the Official Gazette or in any other newspapers of general circulation. Any tract of public land of the class covered by this title maybe sold or leased for the purpose of founding a cemetery. the lease or sale of those lots. SECTION 67. executors. waive the rescission arising from a violation of the conditions of subsection (d). however. shall commence work thereon within six months from the receipt of the order of award. subject to revocation at any time when. subject to such conditions as he may prescribe. or if the National Assembly disposes otherwise. if necessary SECTION 68. and the plans thereof. in the form of donation. sale. with the approval of the President. or any other form. The contract of sale may contain other conditions not inconsistent with the provisions of this Act. church. (e) At the expiration of the lease or of any extension of the same. shall commence the construction thereof within six months from the date of the award of the right to lease the land. (g) The continuance of the easements of the coast police and other easements reserved by existing law or by any laws hereafter enacted. his heirs. the public interest shall require it. upon payment of a reasonable charge. and shall complete the said construction within eighteen months from said date. The sale or lease shall be made subject to the same conditions as required for the sale and lease of agricultural public land. for the use of any portion of the lands covered by this chapter for any lawful private purpose. SECTION 70. school. The kind of improvements to be made by the lessee or the purchaser. If all or part of the lots remain unleased or unsold. and Other Similar Purposes CHAPTER IX Concession of Lands for Educational. at a price to be fixed by said Secretary. may order the sale to be made without public auction. comprise the following conditions: (a) The purchaser shall make improvements of a permanent character appropriate for the purpose for which the land is purchased. The Secretary of Agricultural and Commerce may grant to qualified persons temporary permission. and adjudication shall be made to the highest bidder.

In either case it shall be a condition that the purchaser or lessee or their successors or assigns shall not sell transfer. whether public or private. Whenever it shall be considered to be in the public interest to found a new town. as an inherent condition thereof. with his recommendations. Lots for which satisfactory bids have not been received shall be again offered for sale. and other public uses. SECTION 75. and that the violation of this condition shall give rise to the immediate rescission of the sale or lease. with a view to the possible subsequent purchase or condemnation thereof. shall be numbered upon a general plan or system. Not more than two residence lots and two lots for commercial and industrial uses in any one town site shall be sold to any one person. annul. under the same conditions as the first time. the President shall direct the SolicitorGeneral or officer acting in his stead to at once begin proceedings for condemnation. at a rental to be fixed by him. then in the manner which may to the Director of Lands seem best adapted to the convenience and interest of the public and the residents of the future town. the Director of Lands shall record the same in the records of his office and shall forward a certified copy of such record to the register of deeds of the province in which the land lies. the Director of Lands. SECTION 77. with or without conditions. encumber or lease the land for the purposes of speculation or use it for any purpose other than that contemplated in the application. encumbered or resold under the conditions above set forth except with the approval of the Secretary of Agriculture and Commerce. the President may. the Director of Lands shall be authorized to sell them at private sale for not less than two-thirds of their appraised value. and if they then remain unsold. Unless the necessary reservations are made in the proclamation of the President. and if there shall not be any. All funds derived from the sale of lots shall be covered into the Philippine Treasury as part of the general funds. SECTION 80. and squares. . The Secretary of Agriculture and Commerce. alleyways. The avenues. modification. plazas. SECTION 82. amendment. and lots shall be laid out on the plat as though the lands owned or claimed by private persons were part of the public domain and part of the reservation. SECTION 74. associations. or partnerships not authorized to purchase public lands for commercial. and having completed the legal proceedings prescribed in chapter thirteen of this Act. The plat of the subdivision shall designate certain lots for commercial and industrial uses and the remainder as residence lots. limitation. with the approval of the Secretary of Agriculture and Commerce. The Assembly shall have the power at any time to modify. in order to carry out the provisions of this chapter. All lots. The plat prepared by the Director of Lands shall be submitted to the Secretary of Agriculture and Commerce for consideration. shall reserve out of the land by him to be subdivided lots of sufficient size and convenient situation for public use. corporations. all and any dispositions made by the executive branch of the Philippine Government by virtue of this chapter. if he approves the recommendations of the Director of Lands. but no bid shall be accepted that does not equal at least two-thirds of the appraised value. or approval. shall submit the matter to the President to the end that the latter may issue a proclamation reserving the land surveyed. corporation. in accordance with the provisions of existing law. or possessed or claimed by them as private property.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 102 the lease to be granted without auction. or association without the specific approval of the Secretary of Agriculture and Commerce. TITLE V Reservations CHAPTER X Town Site Reservations SECTION 71. At any time after the subdivision has been made. and upon the completion of the survey he shall send the same to said Secretary. nor shall bids be accepted from persons. and to the forfeiture to the Government of all existing improvements: Provided. after the approval and recording of the plat of subdivision as above provided. and the exercise of this power shall be understood as reserved in all cases. to be by such register recorded in the records of his office SECTION 79. streets. The provisions of sections twenty-six and sixty-five of this Act shall be observed in so far as they are applicable. rescind. buildings. and a certified copy of such proclamation shall be sent to the Director of Lands and another to the register of deeds of the province in which the surveyed land lies. and shall also reserve and note the lots owned by private individuals as evidenced by record titles. except those claimed by or belonging to private parties and those reserved for parks. SECTION 76. That it shall in no case be sublet. after having recorded the proclamation of the President and the survey accompanying the same. parks. SECTION 72. or reservations. if there shall be such instructions. as well as the necessary avenues. residential or industrial purposes under the provisions of this Act. SECTION 78. SECTION 81. parks. It shall then be the duty of the Director of Lands. it shall be necessary to condemn private lands within the limits of the new town. repeal. alleys. in case the public interest requires it. if deemed necessary by the proper authorities. or such part thereof as he may deem proper. SECTION 73. When the plat of subdivision has been finally approved by the Secretary of Agriculture and Commerce. to direct a subdivision in accordance with the instructions of the Secretary of Agriculture and Commerce. If. alter. and cancel. at public auction to the highest bidder. the Secretary of Agriculture and Commerce shall direct the Director of Lands to have a survey made by his Bureau of the exterior boundaries of the site on which such town is to be established. reserve for public purposes any lot or lots of the land so reserved and not disposed of. as a town site. after due notice. Such lots. as the case may be. exceptions. shall be sold. streets.

or other chiefs of the so-called non-Christian tribes. in so far as practicable. or other disposition until again declared alienable under the provisions of this Act or by proclamation of the President. to such conditions as the National Assembly may establish for the reimbursement of the expense incurred in putting such lands in condition for cultivation: Provided. and a copy of this record shall be forwarded to the register of deeds of the province or city where the land lies. however. in accordance with regulations prescribed for this purpose. the President may. hydraulic power sites. are hereby declared to be illegal. SECTION 90. deeds. The tract or tracts of land reserved under the provisions of section eighty-three shall be non-alienable and shall not be subject to occupation. SECTION 84. and all deeds and other documents executed or issued or based upon the deeds. the use and benefit only of a tract of land not to exceed four hectares for each male member over eighteen years of age or the head of a family. privileges. including reservations for highways. granted by sultans. subject. or for quasi-public uses or purposes when the public interest requires it. if requested to do so by the Secretary of Agriculture and Commerce. shall proceed in accordance with the provision of section fifty-three of this Act. his age. SECTION 87. A certified copy of every proclamation of the President issued under the provisions of this title shall be forwarded to the Director of Lands for record in his office. Upon recommendation by the Secretary of Agriculture and Commerce. public parks. turn over a colony so reserved to any person or corporation. and Legal Restrictions and Encumbrances SECTION 89. designate any tract or tracts of the public domain for the exclusive use of the non-Christian Filipinos. workingmen's village and other improvements for the public benefit. may by proclamation. or without the consent of the United States Government or of the Philippine Government since the sovereignty over the Archipelago was transferred from Spain to the United States. All applications filed under the provisions of this Act shall be addressed to the Director of Lands. Upon recommendation of the Secretary of Agriculture and Commerce. or easements appertaining to or growing out of lands. If all the lands included in the proclamation of the President are not registered under the Land Registration Act. civil status. sale. place of birth. But any non-Christian inhabitant may at any time apply for the general benefits of this Act provided the Secretary of Agriculture and Commerce is satisfied that such inhabitant is qualified to take advantage of the provisions of the same: Provided. but final disposition shall be made of the land in accordance with the provisions of this Act. CHAPTER XI Reservations for Public and Semi-Public Purposes SECTION 83. without the authority of the Spanish Government while the Philippines were under the sovereignty of Spain. of four or more hectares of land. and prepare for cultivation the lands of said colony and establish the necessary irrigation system and suitable roads and fences. the Solicitor-General. and as soon as the plat has been completed. void. The Secretary of Agriculture and Commerce may also. SECTION 88. and although the disposition of the lands to the colonists shall be made under the provisions of this Act. and the subdivision and distribution of said lands as above provided shall be taken into consideration in the final disposition of the same. yet. CHAPTER XII Provisions Common to Reservations SECTION 86. in order that such person or corporation may clear. communal pastures or leguas comunales. As soon as the Secretary of the Interior shall certify that the majority of the non-Christian inhabitants of any given reservation have advanced sufficiently in civilization. the President. irrigation systems. by proclamation designate any tract or tracts of land of the public domain for the establishment of agricultural colonies. entry. Concession of Lands. or of the inhabitants thereof. patents and other instruments of conveyance of land or purporting to convey or transfer rights of property. the . public quarries. the Secretary of Agriculture and Commerce may make the necessary rules and regulations for the organization and internal administration of the same. SECTION 85. under conditions to be established by the Assembly. and documents mentioned. Upon the recommendation of the Secretary of Agriculture and Commerce. then the President may order that the lands of the public domain within such reservation be granted under the general provisions of this Act to the said inhabitants. he shall proceed in accordance with the next following section. rights of way for railroads. public fishponds. and granting to each member not already the owner. while the Government shall have the supervision and management of said colonies. including in the reservation. association or copartnership. Upon receipt of such certified copy. TITLE VI General Provisions CHAPTER XIII Applications: Procedure. and postoffice address. the lands used or possessed by them. lease. datus. by title or gratuitous patent. That the National Assembly may direct that such land so prepared for cultivation may be disposed of only by sale or lease. patents. Every application under the provisions of this Act shall be made under oath and shall set forth: (a) The full name of applicant. In case the applicant is a corporation. citizenship. the Director of Lands shall order the immediate survey of the proposed reservation if the land has not yet been surveyed. the President may designate by proclamation any tract or tracts of land of the public domain as reservations for the use of the Commonwealth of the Philippines or of any of its branches. That all grants. and of no effect.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 103 break.

and if so. or whether the land is not occupied. either directly or indirectly. the date and place of the death of the ascendant. and the number of shares subscribed by each. an order of cancellation may issue without further proceedings. and of the death of the latter and the descendants left by him. in case it is alleged that he occupied and cultivated the land first. or whether there are indications of its having been occupied. improved. from time to time and whenever he may deem it advisable. for the actual purpose of using the land for the object specified in the application and for no other purpose. accompanying satisfactory evidence of the relationship of the applicant with the ascendant. (e) That the application is made for the exclusive benefit of the application and not. 68 SECTION 91. their citizenship. or whether they continue to exist and are maintained and preserved in good faith. and in this case. title. barrio. For the purposes of this section. in what such indications consist. or change of the material facts set forth in the application shall ipso facto produce the cancellation of the concession. the name of the ascendant. and by whom. changing. stating its nature the province. The statements made in the application shall be considered as essential conditions and parts of any concession. (f) As accurate a description of the land as may be given. (g) Whether all or part of the land is occupied or cultivated or improved. so far as practicable. or permit granted. how such investigations were made and what was the result thereof. and any false statements therein or omission of facts altering. alteration. SECTION 93. demarcated and preserved as permanent timberland to be planted exclusively to trees of known economic value. and the subdivision assigned to the applicant or grantee shall. or improved entirely or partially. municipality. to make the necessary investigations for the purpose of ascertaining whether the material facts set out in the application are true. and that the land is suitable for the purpose to which it is to be devoted. the lands shall be rectangular in form so far as practicable. the relationship with him. or shall refuse or fail to give direct and specific answers to pertinent questions. and that he shall not make any clearing thereon or utilize the same for ordinary farming purposes even after patent shall have been issued to him or a contract of lease shall have been executed in his favor. giving the names of the stockholders or members. shall be . association or copartnership together with an affidavit of its President. and sitio where it is located. it shall appear that the applicant is utilizing and is only able to utilize a smaller area. The regulations to be issued for the execution of the provisions of this section shall take into account the legal subdivision to be made by the Government and the inadvisability of granting the best land at a given place to only one person. and any subsequent modification. provided the interests of the applicant or grantee are protected. or partnership. the existence of bad faith. SECTION 92.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 104 application shall be accompanied with a certified copy of its articles of incorporation. whether he has made investigations as to when and by whom such improvements were made. The concession or disposition shall be for less than the maximum area authorized if. or modifying the consideration of the facts set forth in such statements. cultivated. Although the maximum area of public land that may be acquired is fixed. specifying those having reference to accidents of the ground or permanent monuments. even though the application is for a greater area. cd i (d) That the application is made in good faith. In every investigation made in accordance with this section. (h) That the land applied for is neither timber nor mineral land and does not contain guano or deposits of salts or coal. If subdivisions have not been made on the date of the application. to obtain compulsory process from the courts. manager. and on the basis of such presumption. the Director of Lands is hereby empowered to issue subpoenas and subpoenas duces tecum and. if any. That he has none of the disqualifications mentioned herein. if necessary. purchase. the Director of Lands is authorized to determine the area that may be granted to the applicant. association. (b) (c) That the applicant has all the qualifications required by this Act in the case. improved. or cultivated either entirely or partially. and there are no indications of it having ever been occupied. but it shall be endeavored to make them conform to the legal subdivision as soon as the same has been made. at the time of the issuance of the patent or of the concession or disposition. and for the purposes of such investigation. yet the spirit of this Act is that the rule which must deter-mine the real area to be granted is the beneficial use of the land. for the benefit of any other person or persons. or permit issued on the basis of such application. It shall be the duty of the Director of Lands. giving his post-office address. concealment. and its limits and boundaries. or lease if convinced of the lack of means of the applicant for using the land for the purpose for which he has requested it. what is the condition of the land. include the land improved or cultivated. and whether the land has been occupied or cultivated or improved by the applicant or his ascendant. and description of the improvements made. or other responsible officer. (i) That the applicant agrees that a strip forty meters wide starting from the bank on each side of any river or stream that may be found on the land applied for. or cultivated. Lands applied for under this Act shall conform to the legal subdivisions and shall be contiguous if comprising more than one subdivision. and to deny or cancel or limit any application for concession. fraud. corporation. and if so. or fraudulent and illegal modification of essential facts shall be presumed if the grantee or possessor of the land shall refuse or fail to obey asubpoena or subpoena duces tecum lawfully issued by the Director of Lands or his authorized delegates or agents. the date when the possession and cultivation began. title.

the same shall be entitled to the reimbursement of the proceeds of the sale of the improvements and crops. All actions for the reversion to the Government of lands of the public domain or improvements thereon shall be instituted by the Solicitor-General or the officer acting in his stead. be granted a prior right of entry for a term of sixty days from the date of the notice. the Director of Lands shall inform the occupant of his prior right to apply for the land and shall give him one hundred and twenty days time in which to file the application or apply for the concession by any of the forms of disposition authorized by this Act. SECTION 101. it . the Director of Lands shall deny or cancel the application or deny patent or grant. land for which an application has been denied or canceled or a patent or grant refused. Any person. SECTION 97. association. if any. if he shows to the satisfaction of the Director of Lands that he has occupied and improved a sufficient area of the land or incurred sufficient expenses in connection therewith to warrant such reimbursement. and oaths of any kind required or necessary under this Act may be made before the justice of the peace 71 of the municipality in which the land lies. In case the cancellation is due to delinquency on the part of the applicant or grantee. except in the following cases: (a) In purchases under chapters five and ten of this Act. the President may. but at any time after the first five years from the approval of the lease. designate a term within which occupants with improvements but not entitled to free patents may apply for the land occupied by them. if such occupant is qualified to acquire a concession under this Act. and classified. or partnership. SECTION 100. but if the legal subdivisions have not yet been made. SECTION 105. upon its decision becoming final. or before the judge or clerk of the Court of First Instance of the province in which the land lies. in the name of the Commonwealth of the Philippines. whoever it be. after the applicant or grantee has been given suitable opportunity to be duly heard. In case the legal subdivisions have already been made at the time of the filing of the application. in other purchases the purchases. or may declare such land open only to sale or lease. SECTION 104. SECTION 99. after deducting the total amount of his indebtedness to the Government and the expense incurred by it in the sale of the improvements or crops and in the new concession of the land. the occupant or occupants have not made application under any of the provisions of this Act at the expiration of the time limit fixed. corporation. of the indemnity fixed by said court for the cultivation and improvement. All the proofs. or before any justice of the peace or chargeable notary public of the province in which the land lies. The fees for the taking of final evidence before any of the officials herein-before mentioned shall be as follows: For each affidavit. SECTION 106. If in the case of the two last preceding sections. shall be forfeited to the Government. and the person objecting shall. or before any officer or employee of the Bureau of Lands authorized by law to administer oaths. who shall be entitled to have issued to them the patent or final concession if they show that they have complied with the requirements therefor. SECTION 96. order the payment to the grantee. fifty centavos. shall also be forfeited to the Government. if qualified. the lessee shall be entitled to the reimbursement of one-half of the cost of the survey. in the proper courts. no charge shall be made for the survey. All rights in and interest to. in accordance with this Act. or at any time when the applicant or grantee still has obligations pending with the Government. and who shall be subrogated in all his rights and obligations for the purposes of this Act. SECTION 95. For each deposition of the applicant or the witness. and the improvements on the land. or association may file an objection under oath to any application or concession under this Act.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 105 SECTION 94. they shall lose any prior right to the land recognized by this Act. in which case the court shall. If at any time after the approval of the application and before the issuance of a patent or the final concession of the land. If. in accordance with this Act. and the improvements and crops upon. As soon as any land of the public domain has been surveyed. If before the delimitation and survey of a tract of public land the President shall declare the same disposable or alienable and such land shall be actually occupied by a person other than the applicant. unless he shall bring action in the proper court before such action for recovery prescribes and obtains favorable judgment therein. SECTION 98. if they have the qualifications required by this Act. or while the applicant or grantee still has obligations pending towards the Government. grounded on any reason sufficient under this Act for the denial or cancellation of the application or the denial of the patent or grant. the cost of the survey shall be charged to the Government. or during the life of the lease. shall lose all to the part of the land so cultivated and improved. SECTION 103. shall pay the total cost of the survey. The Secretary of Agriculture and Commerce may order such improvements and crops to be appraised separately. (b) In leases. and during Cost of the life of the same. Any owner of uncultivated agricultural land who knowingly permits application for the same to be made to the Government and the land to be tilled and improved by a bona fide grantee without protesting to the Bureau of Lands within one year after cultivation has begun. he shall be succeeded in his rights and obligations with respect to the land applied for or granted or leased under this Act by his heirs in law. If at any time the applicant or grantee shall die before the issuance of the patent or the final grant of the land. the cost of the survey shall be charged to the purchaser if the same is a corporation. fifty centavos. affidavits. SECTION 102. the objection is found to be well founded. the cost of the survey shall be paid by the lessee. or a contract or concession rescinded or annulled. in the order issued by him declaring it open for disposition. for sale to the new applicant or grantee. or during the life of the lease. within a reasonable period. delimited.

certificates. whether made by the Bureau of Lands or by a private surveyor. That no applicant shall be permitted to split the area applied for by him in excess of the area fixed in this section among his relatives within the sixth degree of consanguinity or affinity excepting the applicant's married children who are actually occupying the land: Provided. and the same are recognized and acknowledged by the local customs. entries. by priority of possession. and also a right of way for the construction and maintenance of such flumes. Patents or certificates issued under the provisions of this Act shall not include nor convey the title to any gold. telegraph and telephone lines and similar works as the Government or any public or quasi-public service or enterprise. o r order conduits as may be needed in conveying the water to the point where its fall will yield the greatest power.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 106 appears that the land applied for is necessary. and a right of way to the nearest public highway from the land thus excepted. There is hereby reserved from the operation of all patents. supposing it to be subject to grant under this Act. railroads. iron. the measure. SECTION 108. or other purposes have vested and accrued. SECTION 109. and the limit of all rights thereto. All persons receiving title to lands under the provisions of this Act shall hold such lands subject to the provisions hereof and to the same public servitudes as exist upon lands owned by private persons. All surveys pending approval by the Director of Lands at the time this Act takes effect shall be acted upon by him within ninety days from the effectivity of this Act. may reasonably require for carrying on their business. or the power from the point of conversion to the point of use. coal. or by the laws and decisions of the courts. with damages for the improvements only. manufacturing. not exceeding four hectares. including those with reference to the littoral of the sea and the banks of navigable rivers or rivers upon which rafting may be done. gums. has been approved by the Director of Lands. and to the Secretary of Agriculture and Natural Resources 75 the power to sign patents or certificates covering lands exceeding one hundred forty-four hectares in area: Provided. rights to the use of water for mining. or roadsteads. is hereby excepted from such grants. That the President of the Philippines may delegate to the Secretary of Agriculture and Natural Resources74 and/or the Under secretary for Natural Resources 74 the power to sign patents or certificates covering lands not exceeding one hundred forty-four hectares in area. roads. Said land shall further be subject to a right-of-way not exceeding sixty (60) meters in width for public highways. Where the convertible power in any stream running through or by land granted under the authority of this Act thus exceeds fifty horsepower. or other substances containing minerals. Any person aggrieved by the decision or action of the District Land Officer may. for the protection of any source of water or for any work for the public benefit that the Government wishes to undertake. if any. All patents or certificates for land granted under this Act shall be prepared in the Bureau of Lands and shall be issued in the name of the Government of the Republic of the Philippines under the signature of the President of the Philippines: Provided. 77 SECTION 113. the convertible power from which at ordinary low water exceeds fifty horse power. . or coal oil contained in lands granted thereunder. further. or vest the grantee with other valuable rights that may be detrimental to the public interest. guano. paid by him to the Government for the land taken from him by virtue of this section: And provided. and all patents granted under this Act shall be subject to any vested and accrued rights to ditches and reservoirs used in connection with such water rights as may have been acquired in the manner above described prior to April eleven. SECTION 111. and actual conveyance of the land shall be effected only as provided in said section. creeks. appeal to the Director of Lands. within thirty days from receipt of the copy of the said decision.however. SECTION 107. In no case shall any land be granted under the provisions of this Act when this affects injuriously the use of any adjacent land or of the waters. The Director of Lands shall promptly act upon all surveys submitted to him for approval and return the same to the District Land Officer within ninety days after receipt of such surveys by his office. however. or other metals or minerals. aqueducts. and for a suitable dam and site for massing the water. precious stones. the Secretary of Agriculture and Commerce may order the cancellation of the application or the non issuance of the patent or concession or the exclusion from the land applied for of such portion as may be required. That copies of said patents issued shall be furnished to the Bureau of Lands for record purposes. further. then so much land as is reasonably necessary for the mill site or site for the power house. foreshore. and grants by the Government authorized under this Act the right to use for the purposes of power any flow of water in any stream running through or by the land granted. and the patents herein granted shall be subject to the right of the Government to make such rules and regulations for the use of water and the protection of the water supply. In case of disapproval. The beneficial use of water shall be the basis. in the public interest. upon payment of the value of the improvements. eighteen hundred and ninety-nine. the possessors and owners of such vested rights shall be maintained and protected in the same. and for other public purposes. Such patents or certificates shall be effective only for the purposes defined in Section one hundred and twenty-two of the land Registration Act. and there is no means of using such power except by the occupation of a part of the land granted under authority of this Act. SECTION 112. in the amount. aqueducts. as it may deem best for the public good. No patent shall issue nor shall any concession or contract be finally approved unless the land has been surveyed and an accurate plat made thereof by the Bureau of Lands. if any. No patent or certificate shall be issued by the District Land Officer unless the survey of the land covered by such patent or certificate. finally. That with respect to the flow of water. silver. wires. That District Land Officers in every province are hereby empowered to sign patents or certificates covering lands not exceeding five hectares in area when the office of the District Land Officer is properly equipped to carry out the purposes of this Act: Provided. SECTION 110. These shall remain to be property of the State. SECTION 114. That when the Government or any concessionaire of the Government shall take possession of the land under this section which a grantee under this Act shall have paid for. except for converting the same into power exceeding fifty horse power. agricultural. including mining or forest concessionaires. is reserved as a servitude or easement upon the land granted by authority of this Act: Provided. the Director of Lands shall state the reasons therefor. copper. said grantee shall be entitled to indemnity from the Government or the concessionaire. poles. as the case may be. rivers. Whenever. irrigation ditches.

transfer. or by royal grant or in any other form. SECTION 116. homestead. interest. shall draw simple interest at the rate of four per centum per annum from and after the date in which the debtor shall become delinquent. Except in favor of the Government or any of its branches. SECTION 123. shall be null and void. SECTION 117. lease or acquisition of such water privilege. That this prohibition shall not be applicable to the conveyance or acquisition by reason of hereditary succession duly acknowledged and legalized by competent courts. shall be transferred or assigned to any individual. corporations. homestead. Conveyance and encumbrance made by persons belonging to the so-called "non-Christian Filipinos" or national cultural minorities. or lands of any other denomination that were actually or presumptively of the public domain. shall be valid if the person making the conveyance or encumbrance is able to read and can understand the language in which the instrument or conveyance or encumbrances is written. That such acquisition is approved by the Secretary of Natural Resources within six (6) months from the effectivity of this Decree. except to persons. beginning with the year next following the one in which the homestead application has been filed. or partnership may acquire or have any right. however. That no final decision of reversion of such land to the State has been rendered by a court. or institutions. associations. on the basis of the value fixed in such filing. association. such persons. assignment. shall. Except in cases of hereditary succession. ordinance. Conveyances and encumbrances made by illiterate non-Christian or literate non-Christians where the instrument of conveyance or encumbrance is in a language not understood by the said literate non-Christians shall not be valid unless duly approved by the Chairman of the Commission on National Integration. association. except to persons. no corporation. The appraisal or reappraisal of the lands or improvements subject to concession or disposition under this Act shall be made by the Director of Lands.further. No alienation. within a period of five years from the date of the conveyance. 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. Water power privileges in which the convertible power at ordinary low water shall exceed fifty horse power shall be disposed of only upon terms established by an Act of the Assembly concerning the use. rights thereto or improvements thereon by a corporation. nor any permanent improvement on such land. Provided. as the case may be. All lands granted by virtue of this Act. And Provided. subject to the governmental regulation provided in the previous section. Except with the consent of the grantee and the approval of the Secretary of Natural Resources. The provisions of Section 124 of this Act to the contrary notwithstanding. even though and while the title remains in the State. SECTION 120. or transferred. nor any permanent improvement on such land. which shall be paid by the grantee or the applicant. or lease made in violation hereof. or property right whatsoever to any land granted under the free patent. or legal heirs. nor shall any reappraisal be made with an increase of more than one hundred per centum upon the appraisal or reappraisal next preceding. No land originally acquired in any manner under the provisions of this Act. nor shall they become liable to the satisfaction of any debt contracted prior to the expiration of said period. SECTION 115. or individual sale provisions of this Act or to any permanent improvement on such land. shall exceed one hundred and forty-four hectares. shall be encumbered. or any other provision of law formerly in force in the Philippines with regard to public lands. Provided. which approval shall not be denied except on constitutional and legal grounds. concession or contract. title. SECTION 119. shall encumbered. nor shall such land or any permanent improvement thereon be leased to such individual. approval or signing of the application. Any transfer. royal decree. when proper. be subject to the ordinary taxes. 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. royal order. SECTION 118. SECTION 122. and solely for commercial. In no case shall the appraisal or reappraisal be less than the expense incurred or which may be incurred by the Government in connection with the application or concession. . No land originally acquired in any manner under the pro-visions of any previous Act. or the contract has been signed.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 107 said grantee shall be entitled to the same use of the water flowing through or along his land that other private owners enjoy under the law. alienated. All sums due and payable to the Government under this Act. educational. or conveyed. such property shall revert to the Government. when proper. terrenos baldios y realengos. or conveyance of any homestead after five years and before twentyfive years after issuance of title shall be valid without the approval of the Secretary of Agriculture and Commerce. no land or any portion thereof originally acquired under the free patent. religious or charitable purposes or for a right of way. shall be subject to repurchase by the applicant. or the concession has been approved. or individual sale provisions of this Act. or partnership prior to the promulgation of this Decree for the purposes herein stated is deemed valid and binding. any acquisition of such land. alienated. or any permanent improvement on such land. or partnerships who may acquire lands of the public domain under this Act or to corporations organized in the Philippines authorized therefor by their charters. when the area of said land. associations. or corporations. but the improvements or crops on the land may be mortgaged or pledged to qualified persons. added to that of his own. except homestead fees. industrial. SECTION 121. The Director of Lands may request the assistance of the provincial treasurer of the province in which the land lies or may appoint a committee for such purpose in the province or in the municipality in which the land lies. units. Every conveyance of land acquired under the free patent or homestead provisions. his widow. with the approval of the Secretary of Agriculture and Commerce. lands acquired under free patent or homestead provisions shall not be subject to encumbrance or alienation from the date of the approval of the application and for a term of five years from and after the date of issuance of the patent or grant. further. corporations. corporations or associations not legally capacitated to acquire the same under the provisions of this Act. or associations shall be obliged to alienate said lands or improvements to others so capacitated within the precise period of five years. otherwise. including homesteads upon which final proof has not been made or approved.

or makes or causes to be made or cooperates in the making of a false affidavit in support of any petition. be punished by a fine of not more than five thousands pesos. one hundred and twenty two. but not thereafter. During the existence and continuance of the Commonwealth and before the Republic of the Philippines is finally established. to furnish the same. or both. title. Any acquisition. patent. for any reason. hold or dispose of such land. shall be deemed guilty of coercion and be punished accordingly. are hereby repealed. corporations. actually or presumptively. designate such land as the latter may set aside for military. files or induces or knowingly permits another person. and the application shall be cancelled. shall not be applied in cases in which the right to acquire. or by the imprisonment for not more than five years. the President of the Philippines. or repealed had never been incorporated in this Act. and any person aiding and abetting him therein or serving as a means or tool therefor. SECTION 125. or alienate land in the Philippines. or associations to acquire. encumber. claim. transfer. or other contract made or executed in violation of any of the provisions of sections one hundred and eighteen. none of the other sections or provisions thereof shall be affected thereby and such other sections and provisions shall continue to govern as if the section or provisions so annulled. dispose of. title or interest. in the discretion of the court. shall be punished by a fine of not less than two hundred nor more than five thousand pesos or by imprisonment for not less than two months nor more than five years. in the discretion of the court. shall by deceit or fraud acquire or attempt to acquire lands of the public domain or other real property or any right. upon receipt of the order of the President of the United States. shall. Any person who presents or causes to be presented. by proclamation. and one hundred and twenty-three of this Act. thirty-three. citizens and corporations of the United States shall enjoy the same rights granted to citizens and corporations of the Philippines under this Act. recognized or confirmed. or parts thereof. During the period specified in the next preceding section. Any person who voluntarily and maliciously prevents or hinders or attempts to prevent or hinder the presentation of any application for public land under this Act. hold. in so far as it exists under such treaties. CHAPTER XV Penal Provisions SECTION 129. refuses or fails. association or partnership to file an application in his or its behalf or for his or its interest. in the province where the land is located. SECTION 128. SECTION 132. in the office of the Bureau of Lands in Manila SECTION 130. SECTION 133. any false application. the acquisition of public lands. not being qualified or no longer authorized to apply for public land under the provisions of this Act. naval or other reservations for use of the Government of the United States. the provisions of law on the subject thereof in force prior to the approval of this Act shall govern until the Assembly shall otherwise provide in the premises. shall. association or partnership which. wherever possible. inconsistent with the provisions of this Act. CHAPTER XIV Transitory Provisions SECTION 127. or who in any manner attempts to execute or executes acts intended to dissuade or discourage. and in lieu of the section or provision so annulled. and any other provision or provisions restricting or tending to restrict the right of persons. Any person who. or both.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 108 SECTION 124. Any person. which right. SECTION 126. or both. SECTION 131. and only while these are in force. corporation. one-one hundred and twenty-one. or any interest therein. or aid to dissuade or discourage. lease. . shall be punished for each offense by a fine of not more than one hundred pesos or by imprisonment for not more than three months. Any person who sells forms issued and distributed gratuitously under this Act or who. The provisions of sections twenty-two. or objection respecting lands of the public domain. declaration. or repealed. without sufficient reason. or permanent improvements thereon. benefit or advantage. shall continue and subsist in the manner and to the extent stipulated in said treaties. All laws and regulations. disapproved. or evidence. or permit originally issued. If. being an officer charged with distributing them. TITLE VII Final Provisions CHAPTER XVI Effectiveness of this Act SECTION 134. or cooperates in the presentation of. one hundred and twenty. in the discretion of the court. and one hundred and twenty-three of this Act shall be unlawful and null and void from its execution and shall produce the effect of annulling and cancelling the grant. twenty-three. SECTION 135. or. without having the qualifications required by this Act. shall be deemed guilty of perjury and punished accordingly. conveyance. and cause the reversion of the property and its improvements to the State. any section or provision of this Act is challenged in a competent court and is held to be unconstitutional. upon conviction. one hundred and twenty-two. alienation. disapproved. or property right of any class to the same. permanent improvements thereon or interests therein in the Philippines is recognized by existing treaties in favor of citizens or subjects of foreign nations and corporations or associations organized and constituted by the same. All public auctions provided for in the foregoing chapters in the disposition of public lands shall be held. corporation.

1936 . Approved: November 7. designate a prior date. in which case this Act shall take effect on the date so designated. in the proclamation announcing its effectiveness. nineteen hundred and thirty-six unless the President shall. This Act shall take effect on December first.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 109 SECTION 136.

and which are necessary to ensure their economic. deceit. AND FOR OTHER PURPOSES Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:: CHAPTER GENERAL PROVISIONS Section 1. . d) The State shall guarantee that members of the ICCs/IPs regardless of sex. themselves or through their ancestors. force majeure or displacement by force. refers to land occupied. coastal areas. PROTECT AND PROMOTE THE RIGHTS OF INDIGENOUS CULTURAL COMMUNITIES/INDIGENOUS PEOPLE. force majeure or displacement by force.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 110 Republic Act No.The State shall recognize and promote all the rights of Indigenous Cultural Communities/Indigenous Peoples (ICCs/IPs) hereunder enumerated within the framework of the Constitution: a) The State shall recognize and promote the rights of ICCs/IPs within the framework of national unity and development. APPROPRIATING FUNDS THEREFOR. II AN ACT TO RECOGNIZE. by themselves or through their predecessors-in-interest. mineral and other natural resources.refers to a title formally recognizing the rights of ICCs/IPs over their ancestral lands.Subject to Section 56 hereof. values. and to ensure that members of the ICCs/IPs benefit on an equal footing from the rights and opportunities which national laws and regulations grant to other members of the population and f) The State recognizes its obligations to respond to the strong expression of the ICCs/IPs for cultural integrity by assuring maximum ICC/IP participation in the direction of education. and other lands individually owned whether alienable and disposable or otherwise. . occupied or possessed by ICCs/IPs. taking into consideration their customs." Section 2. refer to all areas generally belonging to ICCs/IPs comprising lands. families and clans who are members of the ICCs/IPs since time immemorial. stealth. possessed and utilized by individuals. Short Title. deceit. burial grounds. private forests. social and cultural well being and shall recognize the applicability of customary laws governing property rights or relations in determining the ownership and extent of ancestral domain. the State shall institute and establish the necessary mechanisms to enforce and guarantee the realization of these rights. the following terms shall mean: a) Ancestral Domains . c) Certificate of Ancestral Domain Title . residential lots.For purposes of this Act. pasture. b) Ancestral Lands . and lands which may no longer be exclusively occupied by ICCs/IPs but from which their traditionally had access to for their subsistence and traditional activities. It shall include ancestral land. including.continuously. e) The State shall take measures. beliefs.refers to a title formally recognizing the rights of possession and ownership of ICCs/IPs over their ancestral domains identified and delineated in accordance with this law. particularly the home ranges of ICCs/IPs who are still nomadic and/or shifting cultivators. . in order to render such services more responsive to the needs and desires of these communities.This Act shall be known as "The Indigenous Peoples Rights Act of 1997. Towards these ends. CHAPTER DEFINITION OF TERMS I Section 3. worship areas. bodies of water. or as a consequence of government projects and other voluntary dealings entered into by government and private individuals/corporations. continuously to the present except when interrupted by war. traditions and institutions. traditions. ESTABLISHING IMPLEMENTING MECHANISMS. but not limited to. held under a claim of ownership.Subject to Section 56 hereof. with the participation of the ICCs/IPs concerned. under claims of individual or traditional group ownership. It shall consider these rights in the formulation of national laws and policies. hunting grounds. b)The State shall protect the rights of ICCs/IPs to their ancestral domains to ensure their economic. to protect their rights and guarantee respect for their cultural integrity. Declaration of State Policies. 8371 October 29. to the present except when interrupted by war. respect and protect the rights of ICCs/IPs to preserve and develop their cultures. residential. and natural resources therein. c) The State shall recognize.inland waters. CREATING A NATIONAL COMMISSION OF INDIGENOUS PEOPLE. forests. . agricultural. d) Certificate of Ancestral Lands Title . Definition of Terms. health. shall equally enjoy the full measure of human rights and freedoms without distinctions or discriminations. communally or individually since time immemorial. their rights to their ancestral domains. 1997 as well as other services of ICCs/IPs. rice terraces or paddies. social and cultural welfare. corporations. swidden farms and tree lots. stealth or as a consequence of government projects or any other voluntary dealings entered into by government and private individuals.

by operation of customary law or inherited from their ancestors. . interference and coercion. systems and practices. air. i) Indigenous Political Structure . at the time of conquest or colonization. Bodong Holder.refer to claims on land and rights thereon which have been devolved to individuals.Indigenous concept of ownership sustains the view that ancestral domains and all resources found therein shall serve as the material bases of their cultural integrity. residential lots. certain ICCs/IPs are known to have occupied. customs and practices traditionally and continually recognized. o) Sustainable Traditional Resource Rights . in accordance with their customs and traditions. Section 6. and utilized a defined territory devolved to them. Council of Timuays. It likewise covers sustainable traditional resource rights. plans and programs to recognize. possessed in the concept of owner. or at the time of inroads of non-indigenous religions and cultures. occupy and use and to which they have claims of ownership. accepted and observed by respective ICCs/IPs. or the establishment of present state boundaries. but who may have been displaced from their traditional domains or who may have resettled outside their ancestral domains. or who have. ICCs/IPs shall likewise include peoples who are regarded as indigenous on account of their descent from the populations which inhabited the country. belonging to the whole community within a defined territory f) Customary Laws . and e) other areas of economic. b) plants.refers to a private. resources and rights thereon. and who have. usages. Indigenous Concept of Ownership. c) collecting. in a language an process understandable to the community.refer to the rights of ICCs/IPs to sustainably use. . be determined in accordance with their respective customary laws and practices. institutions.refers to the office created under this Act. protect and promote the rights of ICCs/IPs. possessed customs.as used in this Act shall mean the consensus of all members of the ICCs/IPs to. under claims of ownership since time immemorial. through resistance to political. as far back as memory reaches.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 111 e) Communal Claims . water. The indigenous concept of ownership generally holds that ancestral domains are the ICC's/IP's private but community property which belongs to all generations and therefore cannot be sold. who have continuously lived as organized community on communally bounded and defined territory.refers to pre-conquest rights to lands and domains which.Ancestral lands and domains shall consist of all areas generally belonging to ICCs/IPs as referred under Sec. occupied. and minerals. ceremonial and aesthetic value in accordance with their indigenous knowledge. tradition and other distinctive cultural traits.refer to a group of people or homogenous societies identified by self-ascription and ascription by other. social and cultural inroads of colonization. and obtained after fully disclosing the intent and scope of the activity. but not limited to. have been held under a claim of private ownership by ICCs/IPs. h) Indigenous Cultural Communities/Indigenous Peoples . fishing and hunting grounds. became historically differentiated from the majority of Filipinos. g) Free and Prior Informed Consent . CHAPTER RIGHTS TO ANCESTRAL DOMAINS III Section 4.refers to a period of time when as far back as memory can go. and which shall be the primary government agency responsible for the formulation and implementation of policies. or any other tribunal or body of similar nature. 3. protect and conserve a) land. items (a) and (b) of this Act. patterns and processed for decision-making and participation.manage.refer to a body of written and/or unwritten rules. nonprofit voluntary organization that has been organized primarily for the delivery of various services to the ICCs/IPs and has an established track record for effectiveness and acceptability in the community where it serves. relationships. k) National Commission on Indigenous Peoples (NCIP) . which shall be under the Office of the President.refers to a private. Composition of Ancestral Lands/Domains. Council of Elders. free from any external manipulation. Concept of Ancestral Lands/Domains. . nonprofit voluntary organization of members of an ICC/IP which is accepted as representative of such ICCs/IPs. disposed or destroyed. have never been public lands and are thus indisputably presumed to have been held that way since before the Spanish Conquest. animals and other organisms. j) Individual Claims .Ancestral lands/domains shall include such concepts of territories which cover not only the physical environment but the total environment including the spiritual and cultural bonds to the area which the ICCs/IPs possess. and p) Time Immemorial . but not limited to. cultural and political institutions. rice terraces or paddies and tree lots. beliefs. . who retain some or all of their own social. identified by ICCs/IPs such as. economic. Section 5. non-indigenous religions and culture.refer to claims on land.refer to organizational and cultural leadership systems. families and clans including. n) People's Organization . d) sacred sites. m) Nongovernment Organization . l) Native Title .

Observe Laws. Right to Develop Lands and Natural Resources.To observe and comply with the provisions of this Act and the rules and regulations for its effective implementation. Maintain Ecological Balance. . Right to Redemption. Persons thus relocated shall likewise be fully compensated for any resulting loss or injury.Right to resolve land conflicts in accordance with customary laws of the area where the land is located. and c. . that will affect or impact upon the ancestral domains and to receive just and fair compensation for any damages which they sustain as a result of the project.In cases where it is shown that the transfer of land/property rights by virtue of any agreement or devise.or is transferred for an unconscionable consideration or price. . . to a non-member of the concerned ICCs/IPs is tainted by the vitiated consent of the ICCs/IPs. restore. further.Right to regulate the entry of migrant settlers and organizations into the domains. Right to Safe and Clean Air and Water.The right to stay in the territory and not be removed therefrom. That should their ancestral domain cease to exist and normalcy and safety of the previous settlements are not possible. the ICCs/IPs shall have access to integrated systems for the management of their inland waters and air space. Right to transfer land/property. the right to an informed and intelligent participation in the formulation and implementation of any project.In case displacement occurs as a result of natural catastrophes.To actively initiate.Subject to Section 56 hereof.ICCs/IPs occupying a duly certified ancestral domain shall have the following responsibilities: a. government or private. sacred places. ICCs/IPs shall be provided in all possible cases with lands of quality and legal status at least equal to that of the land previously occupied by them.The rights of ownership and possession of ICCs/IPs t their ancestral domains shall be recognized and protected. right to develop. Right to Resolve Conflict. such relocation shall take place only with the free and prior informed consent of the ICCs/IPs concerned and whenever possible. the right to negotiate the terms and conditions for the exploration of natural resources in the areas for the purpose of ensuring ecological. . That basic services and livelihood shall be provided to them to ensure that their needs are adequately addressed: e. Responsibilities of ICCs/IPs to their Ancestral Domains. Rights to Ancestral Lands. or used. as determined by agreement or through appropriate procedures.. No ICCs/IPs will be relocated without their free and prior informed consent. Such rights shall include: a. . furthermore. and only in default thereof shall the complaints be submitted to amicable settlement and to the Courts of Justice whenever necessary. nor through any means other than eminent domain. and all improvements made by them at any time within the domains. environmental protection and the conservation measures. . and the right to effective measures by the government to prevent any interfere with. displaced ICCs/IPs shall enjoy security of tenure over lands to which they have been resettled: Provided. Where relocation is considered necessary as an exceptional measure. to their ancestral lands shall be recognized and protected. the State shall endeavor to resettle the displaced ICCs/IPs in suitable areas where they can have temporary life support system: Provided. traditional hunting and fishing grounds.The right to claim ownership over lands.The right to claim parts of the ancestral domains which have been reserved for various purposes.The right of ownership and possession of the ICCs/IPs. to manage and conserve natural resources within the territories and uphold the responsibilities for future generations. Right in Case of Displacement. suitable to provide for their present needs and future development. they shall be guaranteed the right to return to their ancestral domains. Rights of Ownership. Rights to Ancestral Domains. b. pursuant to national and customary laws.To preserve. Restore Denuded Areas. . bodies of water traditionally and actually occupied by ICCs/IPs. . control and use lands and territories traditionally occupied. and maintain a balanced ecology in the ancestral domain by protecting the flora and fauna. and h. Right to Claim Parts of Reservations. the transferor ICC/IP shall have the right to redeem the same within a period not exceeding fifteen (15) years from the date of transfer. c. Right to Regulate Entry of Migrants. watershed areas. .For this purpose. g. undertake and participate in the reforestation of denuded areas and other development programs and projects subject to just and reasonable remuneration. b. . except those reserved and intended for common and public welfare and service. That the displaced ICCs/IPs shall have the right to return to their abandoned lands until such time that the normalcy and safety of such lands shall be determined: Provided. alienation and encroachment upon these rights. b.Such right shall include the right to transfer land or property rights to/among members of the same ICCs/IPs. and other reserves. subject to customary laws and traditions of the community concerned. Right to Stay in the Territories. When such return is not possible. Section 9.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 112 Section 7. f. a. d. as soon as the grounds for relocation cease to exist. . Section 8. owned. to benefit and share the profits from allocation and utilization of the natural resources found therein.

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Section 10. Unauthorized and Unlawful Intrusion. - Unauthorized and unlawful intrusion upon, or use of any portion of the ancestral domain, or any violation of the rights herein before enumerated, shall be punishable under this law. Furthermore, the Government shall take measures to prevent non-ICCs/IPs from taking advantage of the ICCs/IPs customs or lack of understanding of laws to secure ownership, possession of land belonging to said ICCs/IPs. Section 11. Recognition of Ancestral Domain Rights. - The rights of ICCs/IPs to their ancestral domains by virtue of Native Title shall be recognized and respected. Formal recognition, when solicited by ICCs/IPs concerned, shall be embodied in a Certificate of Ancestral Domain Title (CADT), which shall recognize the title of the concerned ICCs/IPs over the territories identified and delineated. Section 12. Option to Secure Certificate of Title under Commonwealth Act 141, as amended, or the Land Registration Act 496. - Individual members of cultural communities, with respect to individually-owned ancestral lands who, by themselves or through their predecessors-in -interest, have been in continuous possession and occupation of the same in the concept of owner since the immemorial or for a period of not less than thirty (30) years immediately preceding the approval of this Act and uncontested by the members of the same ICCs/IPs shall have the option to secure title to their ancestral lands under the provisions of Commonwealth Act 141, as amended, or the Land Registration Act 496. For this purpose, said individually-owned ancestral lands, which are agricultural in character and actually used for agricultural, residential, pasture, and tree farming purposes, including those with a slope of eighteen percent (18%) or more, are hereby classified as alienable and disposable agricultural lands. The option granted under this Section shall be exercised within twenty (20) years from the approval of this Act. CHAPTER RIGHT TO SELF-GOVERNANCE AND EMPOWERMENT IV Section 20. Means for Development /Empowerment of ICCs/IPs. - The Government shall establish the means for the full development/empowerment of the ICCs/IPs own institutions and initiatives and, where necessary, provide the resources needed therefor. CHAPTER SOCIAL JUSTICE AND HUMAN RIGHTS V Section 15. Justice System, Conflict Resolution Institutions and Peace Building Processes. - The ICCs/IPs shall have the right to use their own commonly accepted justice systems, conflict resolution institutions, peace building processes or mechanisms and other customary laws and practices within their respective communities and as may be compatible with the national legal system and with internationally recognized human rights. Section 16. Right to Participate in Decision -Making. - ICCs/IPs have the right to participate fully, if they so choose, at all levels of decision-making in matters which may affect their rights, lives and destinies through procedures determined by them as well as to maintain and develop their own indigenous political structures. Consequently, the State shall ensure that the ICCs/IPs shall be given mandatory representation in policy-making bodies and other local legislative councils. Section 17. Right to Determine and Decide Priorities for Development . - The ICCs/IPs shall have the right to determine and decide their own priorities for development affecting their lives, beliefs, institutions, spiritual well-being, and the lands they own, occupy or use. They shall participate in the formulation,implementation and evaluation of policies, plans and programs for national, regional and local development which may directly affect them. Section 18. Tribal Barangays. - The ICCs/IPs living in contiguous areas or communities where they form the predominant population but which are located in municipalities, provinces or cities where they do not constitute the majority of the population, may form or constitute a separate barangay in accordance with the Local Government Code on the creation of tribal barangays. Section 19. Role of Peoples Organizations. - The State shall recognize and respect the role of independent ICCs/IPs organizations to enable the ICCs/IPs to pursue and protect their legitimate and collective interests and aspirations through peaceful and lawful means.

Section 13. Self-Governance. - The State recognizes the inherent right of ICCs/IPs to self-governance and self-determination and respects the integrity of their values, practices and institutions. Consequently, the State shall guarantee the right of ICCs/IPs to freely pursue their economic, social and cultural development. Section 14. Support for Autonomous Regions. - The State shall continue to strengthen and support the autonomous regions created under the Constitution as they may require or need. The State shall likewise encourage other ICCs/IPs not included or outside Muslim Mindanao and the Cordillera to use the form and content of their ways of life as may be compatible with the fundamental rights defined in the Constitution of the Republic of the Philippines and other internationally recognized human rights.

Section 21. Equal Protection and Non-discrimination of ICCs/IPs. - Consistent with the equal protection clause of the Constitution of the Republic of the Philippines, the Charter of the United Nations, the Universal Declaration of Human Rights including the Convention on the Elimination of Discrimination Against Women and International Human Rights Law, the State shall, with due recognition of their distinct characteristics and identity, accord to the members of the ICCs/IPs the rights, protections and privileges enjoyed by the rest of the citizenry. It shall extend to them the same employment rights, opportunities, basic services, educational and other rights and privileges available to every member of the society.

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Accordingly, the State shall likewise ensure that the employment of any form of force of coersion against ICCs/IPs shall be dealt with by law. The State shall ensure that the fundamental human rights and freedoms as enshrined in the Constitution and relevant international instruments are guaranteed also to indigenous women. Towards this end, no provision in this Act shall be interpreted so as to result in the diminution of rights and privileges already recognized and accorded to women under existing laws of general application. Section 22. Rights during Armed Conflict. - ICCs/IPs have the right to special protection and security in periods of armed conflict. The State shall observe international standards, in particular, the Fourth Geneva Convention of 1949, for the protection of civilian populations in circumstances of emergency and armed conflict, and shall not recruit members of the ICCs/IPs against their will into armed forces, and in particular, for the use against other ICCs/IPs; not recruit children of ICCs/IPs into the armed forces under any circumstance; nor force indigenous individuals to abandon their lands, territories and means of subsistence, or relocate them in special centers for military purposes under any discriminatory condition. Section 23. Freedom from Discrimination and Right to Equal Opportunity and Treatment . - It shall be the right of the ICCs/IPs to be free from any form of discrimination, with respect to recruitment and conditions of employment, such that they may enjoy equal opportunities as other occupationally-related benefits, informed of their rights under existing labor legislation and of means available to them for redress, not subject to any coercive recruitment systems, including bonded labor and other forms of debt servitude; and equal treatment in employment for men and women, including the protection from sexual harassment. Towards this end, the State shall within the framework of national laws and regulations, and in cooperation with the ICCs/IPs concerned, adopt special measures to ensure the effective protection with regard to the recruitment and conditions of employment of persons belonging to these communities, to the extent that they are not effectively protected by the laws applicable to workers in general. ICCs/IPs shall have the right to association and freedom for all trade union activities and the right to conclude collective bargaining agreements with employers' conditions. They shall likewise have the right not to be subject to working conditions hazardous to their health, particularly through exposure to pesticides and other toxic substances. Section 24. Unlawful Acts Pertaining to Employment. - It shall be unlawful for any person: a. To discriminate against any ICC/IP with respect to the terms and conditions of employment on account of their descent. Equal remuneration shall be paid to ICC/IP and non-ICC/IP for work of equal value; and b. To deny any ICC/IP employee any right or benefit herein provided for or to discharge them for the purpose of preventing them from enjoying any of the rights or benefits provided under this Act. Section 25. Basic Services. - The ICC/IP have the right to special measures for the immediate, effective and continuing improvement of their economic and social conditions, including in the areas of employment, vocational training and retraining, housing, sanitation, health and social security. Particular attention shall be paid to the rights and special needs of indigenous women, elderly, youth, children and differently-abled persons. Accordingly, the State shall guarantee the right of ICCs/IPs to government 's basic services which shall include, but not limited to water and electrical facilities, education, health and infrastructure. Section 26. Women. - ICC/IP women shall enjoy equal rights and opportunities with men, as regards the social, economic, political and cultural spheres of life. The participation of indigenous women in the decision-making process in all levels, as well as in the development of society, shall be given due respect and recognition. The State shall provide full access to education, maternal and child care, health and nutrition, and housing services to indigenous women. Vocational, technical, professional and other forms of training shall be provided to enable these women to fully participate in all aspects of social life. As far as possible, the State shall ensure that indigenous women have access to all services in their own languages. Section 27. Children and Youth. - The State shall recognize the vital role of the children and youth of ICCs/IPs in nation-building and shall promote and protect their physical, moral, spiritual, moral, spiritual, intellectual and social well-being. Towards this end, the State shall support all government programs intended for the development and rearing of the children and youth of ICCs/IPs for civic efficiency and establish such mechanisms as may be necessary for the protection of the rights of the indigenous children and youth. Section 28. Integrated System of Education. - The State shall, through the NCIP, provide a complete, adequate and integrated system of education, relevant to the needs of the children and Young people of ICCs/IPs. CHAPTER CULTURAL INTEGRITY VI

Section 29. Protection of Indigenous Culture, traditions and institutions . - The state shall respect, recognize and protect the right of the ICCs/IPs to preserve and protect their culture, traditions and institutions. It shall consider these rights in the formulation of national plans and policies.

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Section 30. Educational Systems. - The State shall provide equal access to various cultural opportunities to the ICCs/IPs through the educational system, public or cultural entities, scholarships, grants and other incentives without prejudice to their right to establish and control their educational systems and institutions by providing education in their own language, in a manner appropriate to their cultural methods of teaching and learning. Indigenous children/youth shall have the right to all levels and forms of education of the State. Section 31. Recognition of Cultural Diversity. - The State shall endeavor to have the dignity and diversity of the cultures, traditions, histories and aspirations of the ICCs/IPs appropriately reflected in all forms of education, public information and cultural-educational exchange. Consequently, the State shall take effective measures, in consultation with ICCs/IPs concerned, to eliminate prejudice and discrimination and to promote tolerance, understanding and good relations among ICCs/IPs and all segments of society. Furthermore, the Government shall take effective measures to ensure that State-owned media duly reflect indigenous cultural diversity. The State shall likewise ensure the participation of appropriate indigenous leaders in schools, communities and international cooperative undertakings like festivals, conferences, seminars and workshops to promote and enhance their distinctive heritage and values. Section 32. Community Intellectual Rights. - ICCs/IPs have the right to practice and revitalize their own cultural traditions and customs. The State shall preserve, protect and develop the past, present and future manifestations of their cultures as well as the right to the restitution of cultural, intellectual, religious, and spiritual property taken without their free and prior informed consent or in violation of their laws, traditions and customs. Section 33. Rights to Religious, Cultural Sites and Ceremonies . - ICCs/IPs shall have the right to manifest, practice, develop teach their spiritual and religious traditions, customs and ceremonies; the right to maintain, protect and have access to their religious and cultural sites; the right to use and control of ceremonial object; and the right to the repatriation of human remains. Accordingly, the State shall take effective measures, in cooperation with the burial sites, be preserved, respected and protected. To achieve this purpose, it shall be unlawful to: a. Explore, excavate or make diggings on archeological sites of the ICCs/IPs for the purpose of obtaining materials of cultural values without the free and prior informed consent of the community concerned; and b. Deface, remove or otherwise destroy artifacts which are of great importance to the ICCs/IPs for the preservation of their cultural heritage. Section 34. Right to Indigenous Knowledge Systems and Practices and to Develop own Sciences and Technologies. - ICCs/IPs are entitled to the recognition of the full ownership and control and protection of their cultural and intellectual rights. They shall have the right to special measures to control, develop and protect their sciences, technologies and cultural manifestations, including human and other genetic resources, seeds, including derivatives of these resources, traditional medicines and health practices, vital medicinal plants, animals and minerals, indigenous knowledge systems and practices, knowledge of the properties of fauna and flora, oral traditions, literature, designs, and visual and performing arts. Section 35. Access to Biological and Genetic Resources . - Access to biological and genetic resources and to indigenous knowledge related to the conservation, utilization and enhancement of these resources, shall be allowed within ancestral lands and domains of the ICCs/IPs only with a free and prior informed consent of such communities, obtained in accordance with customary laws of the concerned community. Section 36. Sustainable Agro-Technical Development. - The State shall recognize the right of ICCs/IPs to a sustainable agro-technological development and shall formulate and implement programs of action for its effective implementation. The State shall likewise promote the bio-genetic and resource management systems among the ICCs/IPs and shall encourage cooperation among government agencies to ensure the successful sustainable development of ICCs/IPs. Section 37. Funds for Archeological and Historical Sites. - The ICCs/IPs shall have the right to receive from the national government all funds especially earmarked or allocated for the management and preservation of their archeological and historical sites and artifacts with the financial and technical support of the national government agencies. CHAPTER NATIONAL COMMISSION ON INDIGENOUS PEOPLES (NCIP) VII

Section 38. National Commission on Indigenous Cultural Communities /Indigenous Peoples (NCCP) . - to carry out the policies herein set forth, there shall be created the National Commission on ICCs/IPs (NCIP), which shall be the primary government agency responsible for the formulation and implementation of policies, plans and programs to promote and protect the rights and well-being of the ICCs/IPs and the recognition of their ancestral domains as well as their rights thereto. Section 39. Mandate. - The NCIP shall protect and promote the interest and well-being of the ICCs/IPs with due regard to their beliefs, customs, traditions and institutions. Section 40. Composition. - The NCIP shall be an independent agency under the Office of the President and shall be composed of seven (7) Commissioners belonging to ICCs/IPs, one (1) of whom shall be the Chairperson. The Commissioners shall be appointed by the President of the Philippines from a list of recommendees submitted by authentic ICCs/IPs: Provided, That the seven (7) Commissioners shall be appointed specifically from each of the following ethnographic areas: Region I and the Cordilleras; Region II; the rest of Luzon; Island Groups including Mindoro, Palawan, Romblon, Panay and the rest of the Visayas; Northern and Western Mindanao; Southern and Eastern Mindanao; and Central Mindanao: Provided, That at least two (2) of the seven (7) Commissioners shall be women.

Appointment to any vacancy shall only be for the unexpired term of the predecessor and in no case shall a member be appointed or designated in a temporary or acting capacity: Provided. utilization. Section 43. in such manner consistent with the interest of ICCs/IPs as well as existing laws. n) To decide all appeals from the decisions and acts of all the various offices within the Commission: o) To promulgate the necessary rules and regulations for the implementation of this Act. and . on his own initiative or upon recommendation by any indigenous community. further. That at least two (2) of the seven (7) Commissioners shall be the members of the Philippine Bar: Provided. before the expiration of his term for cause and after complying with due process requirement of law. with government or private agencies or entities as may be necessary to attain the objectives of this Act. corporate entity or any government agency. to obtain loans from government lending institutions and other lending institutions to finance its programs. l) To prepare and submit the appropriate budget to the Office of the President. p) To exercise such other powers and functions as may be directed by the President of the Republic of the Philippines. documents and papers pertaining g) To negotiate for funds and to accept grants. Powers and Functions. lease. to enter into contracts. Section 45. and subject to the approval of the President. social and cultural development of the ICCs/IPs and to monitor the implementation thereof. c) To formulate and implement policies.Any member of the NCIP may be removed from office by the President. agreements. or in the absence of any condition. h) To coordinate development programs and projects for the advancement of the ICCs/IPs and to oversee the proper implementation thereof. q) To represent the Philippine ICCs/IPs in all international conferences and conventions dealing with indigenous peoples and other related concerns. furthermore.To accomplish its mandate. j) To advise the President of the Philippines on all matters relating to the ICCs/IPs and to submit within sixty (60) days after the close of each calendar year. and may be subject to re-appointment for another term: Provided. . f) Subject to existing laws. donations. k) To submit to Congress appropriate legislative proposals intended to carry out the policies under this Act. m) To issue appropriate certification as a pre-condition to the grant of permit. plans. corporation or subdivision thereof on any part or portion of the ancestral domain taking into consideration the consensus approval of the ICCs/IPs concerned. management and appropriation by any private individual. the NCIP shall have the following powers. for the benefit of ICCs/IPs and administer the same in accordance with the terms thereof. That the members of the NCIP shall hold office for a period of three (3) years. Appointment of Commissioners. Section 44. . Accessibility and Transparency. b) To review and assess the conditions of ICCs/IPs including existing laws and policies pertinent thereto and to propose relevant laws and policies to address their role in national development. experienced in ethnic affairs and who have worked for at least ten (10) years with an ICC/IP community and/or any government agency involved in ICC/IP. a report of its operations and achievements. Tenure. subject to the approval of the President of the Philippines. or arrangement. jurisdiction and function: a) To serve as the primary government agency through which ICCs/IPs can seek government assistance and as the medium. That no person shall serve for more than two (2) terms. Section 42. That the Chairperson and the Commissioners shall be entitled to compensation in accordance with the Salary Standardization Law. at least 35 years of age at the time of appointment. thorough which such assistance may be extended. bonafide members of ICCs/IPs as certified by his/her tribe. . assess as well as propose policies or plans. grant. Compensation . .The President shall appoint the seven (7) Commissioners of the NCIP within ninety (90) days from the effectivity of this Act.The Chairperson and the six (6) Commissioners must be natural born Filipino citizens.Subject to such limitations as may be provided by law or by rules and regulations promulgated pursuant thereto. d) To request and engage the services and support of experts from other agencies of government or employ private experts and consultants as may be required in the pursuit of its objectives.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 116 Section 41. Removal from Office. local and international. gifts and/or properties in whatever form and from whatever source. e) To issue certificate of ancestral land/domain title. . and must be of proven honesty and integrity: Provided. Qualifications. finally. i) To convene periodic conventions or assemblies of IPs to review. or any other similar authority for the disposition. programs and projects for the economic. all official records.

The Office of Empowerment and Human Rights shall ensure that indigenous socio. physical therapy and other allied courses pertaining to the health profession. Regional and Field Offices. Officers within the NCIP. promote and support community schools.There shall be a Legal Affairs Office which shall advice the NCIP on all legal matters concerning ICCs/IPs and which shall be responsible for providing ICCs/IPs with legal assistance in litigation involving community interest. It shall administer all scholarship programs and other educational rights intended for ICC/IP beneficiaries in coordination with the Department of Education. f.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 117 to official acts.The Office on Policy. public health and family assistance program and related subjects. it shall initiate the filing of appropriate legal or administrative action to the NCIP. Planning and Research . It shall ensure that capacity building mechanisms are instituted and ICCs/IPs are afforded every opportunity.The NCIP shall have the following offices which shall be responsible for the implementation of the policies herein after provided: a. but not limited to. It shall likewise perform such other functions as the Commission may deem appropriate and necessary. the NCIP shall deploy a representative in each of the said offices who shall personally perform the foregoing task and who shall receive complaints from the ICCs/IPs and compel action from appropriate agency. subject to existing laws. Office of Education. It shall assist. Section 48. rules and regulations are protected and promoted. and g.political. Ancestral Domains Office . as well as research data used as basis for policy development of the Commission shall be made accessible to the public. It shall also identify ICCs/IPs with potential training in the health profession and encourage and assist them to enroll in schools of medicine. and related services. . On the basis of its findings. . within the limits of available appropriation. and such other rights as the NCIP may determine. e. It shall likewise ensure that the basic human rights. c. especially in areas where existing educational facilities are not accessible to members of the indigenous group. b. It shall also administer the Ancestral Domains Fund. supplies. certification prior to the grant of any license. policies. Legal Affairs Office . Office of Empowerment and Human Rights . cultural and related rights as provided in this Act. Education and Health shall be responsible for the effective implementation of the education.The Ancestral Domain Office shall be responsible for the identification. transactions or decisions. Office on Policy. equipment. It shall also issue.The Administrative Office shall provide the NCIP with economical. Other Offices. nursing. It shall undertake. Culture and Health . That in provinces where there are ICCs/IPs but without field offices.The Office on Socio-Economic Services and Special Concerns shall serve as the Office through which the NCIP shall coordinate with pertinent government agencies specially charged with the implementation of various basic socio-economic services. evaluation and policy formulation. lease or permit for the exploitation of natural resources affecting the interests of ICCs/IPs in protecting the territorial integrity of all ancestral domains. Other field office shall be created wherever appropriate and the staffing pattern thereof shall be determined by the NCIP: Provided. It shall also be responsible for the management of ancestral lands/domains in accordance with the master plans as well as the implementation of the ancestral domain rights of the ICCs/IPs as provided in Chapter III of this Act. . Such plan shall undergo a process such that every five years. a special program which includes language and vocational training. cultural and economic rights are respected and recognized. records. Towards this end. for the benefit of the local indigenous community. . Planning and Research shall be responsible for the formulation of appropriate policies and programs for ICCs/IPs such as. to participate in all level decision-making. It shall also be responsible for such other functions as the NCIP may deem appropriate and necessary.Existing regional and field offices shall remain to function under the strengthened organizational structure of the NCIP. Culture and Sports and the Commission on Higher Education. It shall also monitor the activities of the National Museum and other similar government agencies generally intended to manage and preserve historical and archeological artifacts of the ICCs /IPs and shall be responsible for the implementation of such other functions as the NCIP may deem appropriate and necessary. It shall assist the legislative branch of the national government in the formulation of appropriate legislation benefiting ICCs/IPs. efficient and effective services pertaining to personnel. both formal and non-formal.The NCIP shall have the power to create additional offices as it may deem necessary subject to existing rules and regulations.The Office on Culture. d. security. finance. plans and programs affecting the ICCs/IPs to ensure that the same are properly and directly enjoyed by them. upon the free and prior informed consent of the ICCs/IPs concerned. the Commission shall endeavor to assess the plan and make ramifications in accordance with the changing situations. the development of a Five-Year Master Plan for the ICCs/IPs. if they so choose. Section 46. the NCIP shall establish field offices in said provinces. Office on Socio-Economic Services and Special Concerns . Section 47. The Office shall also undertake the documentation of customary law and shall establish and maintain a Research Center that would serve as a depository of ethnographic information for monitoring. Administrative Office . delineation and recognition of ancestral land/domains. It shall conduct preliminary investigation on the basis of complaints filed by the ICCs/IPs against a natural or juridical person believed to have violated ICCs/IPs rights.

As such. . sacred places and old villages. shall be prepared by the Ancestral Domains Office of the NCIP. Anthropological data. by a majority of the members of the ICCs/IPs. burial grounds.Proof of Ancestral Domain Claims shall include the testimony of elders or community under oath. elders and representatives from the women and youth sectors of the different ICCs/IPs shall be constituted by the NCIP from the time to time to advise it on matters relating to the problems. but to which they have traditionally had access for their subsistence and traditional activities. ICCs/IPs enactment of this law shall have the right to apply for the issuance of a Certificate of Ancestral Domain Title (CADT) over the area without going through the process outlined hereunder. particularly of ICCs/IPs who are still nomadic and/or shifting cultivators. Delineation Paper .The official delineation of ancestral domain boundaries including census of all community members therein. 2.The process of delineating a specific perimeter may be initiated by the NCIP with the consent of the ICC/IP concerned. Section 50.The identification and delineation of ancestral domains shall be done in accordance with the following procedures: a. Consultative Body. complete with technical descriptions. Historical accounts. Delineation will be done in . Measures shall be taken in appropriate cases to safeguard the rights of the ICCs/IPs concerned to land which may no longer be exclusively occupied by them. Office of the Executive Director. 4.On the basis of such investigation and the findings of fact based thereon. Written accounts of the ICCs/IPs political structure and institution. and a description of the natural features and landmarks embraced therein. ridges. shall be immediately undertaken by the Ancestral Domains Office upon filing of the application by the ICCs/IPs concerned. will be essential to the determination of these traditional territories. creeks. Write-ups of names and places derived from the native dialect of the community. nor to ancestral lands and domains delineated under any other community/ancestral domain program prior to the enactment of his law. Report of Investigation and Other Documents . if any. 5. f. including pacts and agreements concerning boundaries entered into by the ICCs/IPs concerned with other ICCs/IPs. the ICCs/IPs concerned shall have a decisive role in all the activities pertinent thereto. Delineation Process. and other documents directly or indirectly attesting to the possession or occupation of the area since time immemorial by such ICCs/IPs in the concept of owners which shall be any one (1) of the following authentic documents: 1. 9. Pictures showing long term occupation such as those of old improvements. Survey plans and sketch maps. series of 1993.A complete copy of the preliminary census and a report of investigation. The staffing pattern of the office shall be determined by the NCIP subject to existing rules and regulations. rivers. 3. Delineation and Recognition of Ancestral Domains . Ancestral Domains Delineated Prior to this Act . d. b.The NCIP shall create the Office of the Executive Director which shall serve as its secretariat. aspirations and interests of the ICCs/IPs. terraces and the like.The provisions hereunder shall not apply to ancestral domains/lands already delineated according to DENR Administrative Order No. Genealogical surveys. Pictures and descriptive histories of traditional communal forests and hunting grounds. Petition for Delineation .Self-delineation shall be guiding principle in the identification and delineation of ancestral domains. . 6. the Ancestral Domains Office of the NCIP shall prepare a perimeter map. c.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 118 Section 49. CHAPTER DELINEATION AND RECOGNITION OF ANCESTRAL DOMAINS VIII coordination with the community concerned and shall at all times include genuine involvement and participation by the members of the communities concerned. 8. Proof required . Pictures and descriptive histories of traditional landmarks such as mountains. Preparation of Maps . Section 52. . Section 51. and 10. e. 2. Written accounts of the ICCs/IPs customs and traditions.A body consisting of the traditional leaders. The office shall be headed by an Executive Director who shall be appointed by the President of the Republic of the Philippines upon the recommendation of the NCIP on a permanent basis. hills. . The Sworn Statement of the Elders as to the Scope of the territories and agreements/pacts made with neighboring ICCs/IPs. or through a Petition for Delineation filed with the NCIP. 7. The Government shall take the necessary steps to identify lands which the ICCs/IPs concerned traditionally occupy and guarantee effective protection of their rights of ownership and possession thereto.

a. h. further. and regional offices of the NCIP and shall be published in a newspaper of general circulation once a week for two (2) consecutive weeks to allow other claimants to file opposition thereto within fifteen (15) days from the date of such publication: Provided.A copy of each document. Turnover of Areas Within Ancestral Domains Managed by Other Government Agencies . Issuance of CADT . and any other government agency claiming jurisdiction over the area shall be notified thereof. and Department of Justice. Endorsement to NCIP .ICCs/IPs whose ancestral domains have been officially delineated and determined by the NCIP shall be issued a CADT in the name of the community concerned. A copy of the document shall also be posted at the local. without prejudice to its full adjudication according to the selection below. Fifteen (15) days after such publication. shall cause a parcellary survey of the area being claimed. The denial shall be appealable to the NCIP. The Ancestral Domains office shall reject any claim that is deemed patently false or fraudulent after inspection and verification. Upon receipt of the applications for delineation and recognition of ancestral land claims. the Ancestral Domains office shall give the applicant due notice. broadcasting in a radio station will be a valid substitute: Provided. d. A copy of the document shall also be posted at the local. may shed light on the veracity of the contents of the application/claim. That mere posting shall be deemed sufficient if both newspaper and radio station are not available. That mere posting shall be deemed sufficient if both newspapers and radio station are not available f. In case of rejection. the Ancestral domains Office shall cause the contending parties to meet and assist them in coming up with a preliminary resolution of the conflict. Such notification shall terminate any legal basis for the jurisdiction previously claimed. may have their claims officially established by filing applications for the identification and delineation of their claims with the Ancestral Domains Office. An individual or recognized head of a family or clan may file such application in his behalf or in behalf of his family or clan. the Ancestral Domains Office shall give the applicant due notice. i. and shall be published in a newspaper of general circulation once a week for two (2) consecutive weeks to allow other claimants to file opposition thereto within fifteen (15) days from the date of such publication: Provided. That the Ancestral Domains Office shall reject any claim that is deemed patently false or fraudulent after inspection and verification: Provided. Section 53. In case of conflicting claims among individual or indigenous corporate claimants. the Ancestral Domains Office shall investigate and inspect each application.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 119 g. 52 (d) of this act. furthermore. The allocation of lands within any ancestral domain to individual or indigenous corporate (family or clan) claimants shall be left to the ICCs/IPs concerned to decide in accordance with customs and traditions. further. further. the Ancestral Domains Office shall prepare a report to the NCIP endorsing a favorable action upon a claim that is deemed to have sufficient proof. copy furnished all concerned. provincial and regional offices of the NCIP. That in areas where no such newspaper exists. if the proof is deemed insufficient. the Commissioner of the National Development Corporation. and of the inspection process. respectively. The Ancestral Domains Office may require from each ancestral claimant the submission of such other documents.The NCIP shall register issued certificates of ancestral domain titles and certificates of ancestral lands titles before the Register of Deeds in the place where the property is situated. and . provincial. e. copy furnished all concerned.The Chairperson of the NCIP shall certify that the area covered is an ancestral domain. Registration of CADTs . and k. The secretaries of the Department of Agrarian Reform. That in areas where no such newspaper exists. including tax declarations and proofs of payment of taxes. broadcasting in a radio station will be a valid substitute: Provided. the Ancestral Domains Office shall cause the publication of the application and a copy of each document submitted including a translation in the native language of the ICCs/IPs concerned in a prominent place therein for at least fifteen (15) days. without prejudice to its full adjudication according to Sec.Within fifteen (15) days from publication. In all proceedings for the identification or delineation of the ancestral domains as herein provided. the Ancestral Domains Office shall require the submission of additional evidence: Provided. b. the Director of Lands shall represent the interest of the Republic of the Philippines. which in its opinion. Proofs of such claims shall accompany the application form which shall include the testimony under oath of elders of the community and other documents directly or indirectly attesting to the possession or occupation of the areas since time immemorial by the individual or corporate claimants in the concept of owners which shall be any of the authentic documents enumerated under Sec. Sworn Statements and the like. c. containing the grounds for denial. Notice and Publication . Individual and indigenous corporate claimants of ancestral lands which are not within ancestral domains. Delineation and Certification of Ancestral Lands . containing a list of all those identified in the census. Department of the Interior and Local Government. Identification. That in case of rejection. j. Department of Environment and Natural Resources. containing the grounds for denial. That in cases where there are conflicting claims. The denial shall be appealable to the NCIP: Provided. However. the Ancestral Domains Office shall cause the contending parties to meet and assist them in coming up with a preliminary resolution of the conflict. 62 of this Act. and if found to be meritorious. including a translation in the native language of the ICCs/IPs concerned shall be posted in a prominent place therein for at least fifteen (15) days.

A non-member of the ICCs/IPs concerned may be allowed to take part in the development and utilization of the natural resources for a period of not exceeding twenty-five (25) years renewable for not more than twenty-five (25) years: Provided.The ICCs/IPs shall have the priority rights in the harvesting. . Certification Precondition. areas within the ancestral domains. the NCIP is hereby authorized to request the Department of Environment and Natural Resources (DENR) survey teams as well as other equally capable private survey teams. and which cannot be resolved. or reforestation as determined by the appropriate agencies with the full participation of the ICCs/IPs concerned shall be maintained. shall be presumed to be communally held: Provide. award or ruling of the NCIP on any ancestral domain dispute or on any matter pertaining to the application. or entering into any production-sharing agreement. Temporary Requisition Powers. Section 54. .L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 120 g. lease. Such certificate shall only be issued after a field-based investigation is conducted by the Ancestral Domain Office of the area concerned: Provided.Property rights within the ancestral domains already existing and/or vested upon effectivity of this Act. or production sharing agreement while there is pending application CADT: Provided. The DENR Secretary shall accommodate any such request within one (1) month of its issuance: Provided. protected areas. in turn.Customary laws. That if the dispute is between and/or among ICCs/IPs regarding the traditional boundaries of their respective ancestral domains. and issued to. commercial forest plantation and residential purposes and upon titling by other by private person: Provided. finally. Remedial Measures. but in no case beyond three (3) years after its creation. implementation. . or granting any concession. Fraudulent Claims. Section 60. to delineate ancestral domain perimeters. where there are adverse claims within the ancestral domains as delineated in the survey plan. pursuant to its own decision making process. That no ICCs/IPs shall be displaced or relocated for the purpose enumerated under this section without the written consent of the specific persons authorized to give consent. a provision for technology transfer to the NCIP. The NCIP shall take appropriate legal action for the cancellation of officially documented titles which were acquired illegally: Provided. Section 55. Section 61. without prior certification from the NCIP that the area affected does not overlap with any ancestral domain. evaluate or corporate (family or clan) claimant over ancestral lands. that all exactions shall be used to facilitate the development and improvement of the ancestral domains. forest cover. . . Any doubt or ambiguity in the application of laws shall be resolved in favor of the ICCs/IPs. which are found necessary for critical watersheds. protect and conserve such areas with the full and effective assistance of the government agencies.The Ancestral Domains Office may. That the ICCs/IPs shall have the right to stop or suspend.In cases of conflicting interest. renewing. That a formal and written agreement is entered into with the ICCs/IPs concerned or that the community. Communal Rights. develop. license. extraction.Ancestral domains or portion thereof. Section 59. development or exploitation of any natural resources within the ancestral domains. wilderness. the NCIP shall hear and decide. 386.all department and other governmental agencies shall henceforth be strictly enjoined from issuing. in accordance with this Act. That no department. The Ancestral Domains Office shall prepare and submit a report on each and every application surveyed and delineated to the NCIP. That the transfer shall be temporary and will ultimately revert to the ICCs/IPs in accordance with a program for technology transfer: Provided. .All lands certified to be ancestral domains shall be exempt from real property taxes. That in any decision. upon written request from the ICCs/IPs. which shall. That no certificate shall be issued by the NCIP without the free and prior informed and written consent of the ICCs/IPs concerned: Provided. and other forms of exaction except such portion of the ancestral domains as are actually used for large-scale agriculture.Expropriation may be resorted to in the resolution of conflicts of interest following the principle of the "common good". Section 57. The ICCs/IPs concerned shall be given the responsibility to maintain. That such procedure . No. among others. The NCIP shall promulgate the necessary rules and regulations to carry out its adjudicatory functions: Provided.Prior to the establishment of an institutional surveying capacity whereby it can effectively fulfill its mandate. Section 62. mangroves wildlife sanctuaries. . Section 63. That communal rights under this Act shall not be construed as co-ownership as provided in Republic Act. Environmental Consideration. license or lease. otherwise known as the New Civil Code. finally. That the Memorandum of Agreement shall stipulate. enforcement and interpretation of this Act may be brought for Petition for Review to the Court of Appeals within fifteen (15) days from receipt of a copy thereof. traditions and practices of the ICCs/IPs of the land where the conflict arises shall be applied first with respect to property rights. through a Memorandum of Agreement (MOA). Should the ICCs/IPs decide to transfer the responsibility over the areas. after notice to the proper parties. whether delineated or not.Subject to Section 56 hereof. customary process shall be followed. further. Section 64. Any claim found to be fraudulently acquired by. review existing claims which have been fraudulently acquired by any person or community. Resolution of Conflicts. . any project that has not satisfied the requirement of this consultation process. specially levies. Section 58. has agreed to allow such operation: Provided. managed and developed for such purposes. government agency or government-owned or -controlled corporation may issue new concession. shall be recognized and respected. Applicable Laws. Existing Property Rights Regimes. Natural Resources within Ancestral Domains. . . hereditary succession and settlement of land disputes. claims and ownerships. Exemption from Taxes. . That the all extractions shall be used to facilitate the development and improvement of the ancestral domains. The consent of the ICCs/IPs should be arrived at in accordance with its customary laws without prejudice to the basic requirement of the existing laws on free and prior informed consent: Provided. said decision must be made in writing. any person or community may be cancelled by the NCIP after due notice and hearing of all parties concerned. the disputes arising from the delineation of such ancestral domains: Provided. order. further. further. Section 56.

Section 66. finally. That no such penalty shall be cruel. . authorized and/or unlawful intrusion upon any ancestral lands or domains as stated in Sec. contracts. To administer oaths.No inferior court of the Philippines shall have the jurisdiction to issue any restraining order or writ of preliminary injunction against the NCIP or any of its duly authorized or designated offices in any case. a certification shall be issued by the Council of Elders/Leaders who participated in the attempt to settle the dispute that the same has not been resolved. which certification shall be a condition precedent to the filing of a petition with the NCIP. . issue subpoenas requiring the attendance and testimony of witnesses or the production of such books. delineation and development of ancestral domains. endowments shall be exempted from income or gift taxes and all other taxes. an initial amount of the One Hundred thirty million pesos(P130. Jurisdiction of the NCIP. but not limited to. such as. upon conviction. or shall commit any of the prohibited acts mentioned in Sections 21 and 24. if not restrained forthwith. Provided.000) shall be sourced from the gross income of the Philippine Charity Sweepstakes Office (PCSO) from its lotto operation. further. CHAPTER PENALTIES XI Section 72. . That the action for cancellation shall be initiated within two (2) years from the effectivity of this Act: Provided. Section 67.Decisions of the NCIP shall be appealable to the Court of Appeals by way of a petition for review. be punished by imprisonment of not less than nine (9) months but not more than twelve (12) years or a fine not less than One hundred thousand pesos (P100. Chapter VI hereof. shall have jurisdiction over all claims and disputes involving rights of ICCs/IPs. shall issue a writ of execution requiring the sheriff or the proper officer to execute final decisions. That the action for reconveyance shall be a period of ten (10) years in accordance with existing laws. orders or awards of the Regional Hearing Officer of the NCIP. The NCIP may also solicit and receive donations. In which case. . papers. shall be punished in accordance with the customary laws of the ICCs/IPs concerned: Provided. c. any person who violates any provision of this Act shall. . and Section 71. Section 69. . records.The NCIP. CHAPTER JURISDICTION AND PROCEDURES FOR ENFORCEMENT OF RIGHTS IX d.000) or both such fine and imprisonment upon the discretion of the court. 10. through its regional offices. Section 33. To hold any person in contempt. further. In addition. . That neither shall the death penalty or excessive fines be imposed. however. degrading or inhuman punishment: Provided. To enjoin any or all acts involving or arising from any case pending therefore it which.000) to cover compensation for expropriated lands. This provision shall be without prejudice to the right of any ICCs/IPs to avail of the protection of existing laws. Orders. No restraining Order or Preliminary Injunction. he shall be obliged to pay to the ICCs/IPs concerned whatever damage may have been suffered by the latter as a consequence of the unlawful act. may cause grave or irreparable damage to any of the parties to the case or seriously affect social or economic activity. For this purpose. That no such dispute shall be brought to the NCIP unless the parties have exhausted all remedies provided under their customary laws. and impose appropriate penalties therefor. Ten millions pesos (P10. An amount of Fifty million pesos (P50. Chapter V. Ancestral Domains Fund. dispute or controversy to. CHAPTER ANCESTRAL DOMAINS FUND X Section 65. on its own initiative or upon motion by the prevailing party.000. the fund of the Social Reform Council intended for survey and delineation of ancestral lands/domains. b. Appeals to the Court of Appeals. Punishable Acts and Applicable Penalties. . Awards. to be known as the Ancestral Domains Fund.Upon expiration of the period here provided and no appeal is perfected by any of the contending parties. agreements and other document of similar nature as may be material to a just determination of the matter under investigation or hearing conducted in pursuance of this Act. directly or indirectly. customary laws and practices shall be used to resolve the dispute. and such other source as the government may be deem appropriate. charges or fees imposed by the government or any political subdivision or instrumentality thereof.When disputes involve ICCs/IPs.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 121 shall ensure that the rights of possessors in good faith shall be respected: Provided.There is hereby created a special fund. Quasi-Judicial Powers of the NCIP. the Hearing Officer of the NCIP.Any person who commits violation of any of the provisions of this Act. Section 70.000) from the gross receipts of the travel tax of the preceding year.000. Foreign as well as local funds which are made available for the ICCs/IPs through the government of the Philippines shall be coursed through the NCIP.The NCIP shall have the power and authority: a. Section 68.000) nor more than Five hundred thousand pesos (P500. . Thereafter such amount shall be included in the annual General Appropriations Act.000. Execution of Decisions. summon the parties to a controversy. Chapter III. or interpretation of this Act and other pertinent laws relating to ICCs/IPs and ancestral domains. Primary of Customary Laws and Practices. To promulgate rules and regulations governing the hearing and disposition of cases filed before it as well as those pertaining to its internal functions and such rules and regulations as may be necessary to carry out the purposes of this Act.

Separability Clause. Section 76. They shall be guided by the criteria of retention and appointment to be prepared by the consultative body and by the pertinent provisions of the civil service law. Repealing Clause. Implementing Rules and Regulations. nongovernment organizations (NGOs) who have served the community for at least five (5) years and peoples organizations (POs) with at least five (5) years of existence. but not limited to. Officers and employees who may be reinstated shall refund such retirement benefits or gratuity received: Provided. . That the positions of Regional Directors and below. Section 83. Merger of ONCC/OSCC. orders. a Placement Committee shall be created by the NCIP. and all other laws.In case any provision of this Act or any portion thereof is declared unconstitutional by a competent court. Section 79. other provisions shall not be affected thereby. Persons Subject to Punishment. its president. in consultation with the Committees on National Cultural Communities of the House of Representatives and the Senate. such sums as may be necessary for its continued implementation shall be included in the annual General Appropriations Act. CHAPTER XII MERGER OF THE OFFICE FOR NORTHERN CULTURAL COMMUNITIES (ONCC) AND THE OFFICE FOR SOUTHERN CULTURAL COMMUNITIES (OSCC) Section 74. Thereafter. are hereby merged as organic offices of the NCIP and shall continue to function under a revitalized and strengthened structures to achieve the objectives of the NCIP: Provided. .All real and personal properties which are vested in. finally That absorbed personnel must still meet the qualifications and standards set by the Civil Service and the Placement Committee herein created. decrees. Section 77. recommendations.The ONCC/OSCC shall have a period of six (6) months from the effectivity of this Act within which to wind up its affairs and to conduct audit of its finances. priority shall be given to the former. 122-B and 122-C respectively. That prior land rights and titles recognized and/or required through any judicial. . . . which shall assist in the judicious selection and placement of personnel in order that the best qualified and most deserving persons shall be appointed in the reorganized agency. awards. further. Special Provision. That in the case where an indigenous person and a non-indigenous person with similar qualifications apply for the same position.The City of Baguio shall remain to be governed by its Chapter and all lands proclaimed as part of its townsite reservation shall remain as such until otherwise reclassified by appropriate legislation: Provided. or belonging to. customs and agreements. That all contracts.This Act shall take effect fifteen days (15) days upon its publication in the Official Gazette or in any two (2) newspapers of general circulation. all officers such as. . . . transfer or assignment and shall be held for the same purpose as they were held by the former offices: Provided.Presidential Decree NO. Section 81.The Office for Northern Cultural Communities (ONCC) and the Office of Southern Cultural Communities (OSCC). in coordination with the Civil Service Commission. Appropriations. Placement Committee. created under Executive Order Nos. the penalty shall include perpetual disqualification to hold public office. 410. That if the offender is a public official. manager. modified or amended by the NCIP.The amount necessary to finance the initial implementation of this Act shall be charged against the current year's appropriation of the ONCC and the OSCC. Effectivity. Section 84. in addition to the cancellation of certificates of their registration and/or license: Provided. Saving Clause. are hereby phased-out upon the effectivity of this Act: Provided. . Executive Order Nos. . for the effective implementation of this Act. Section 80. Transition Period. The placement Committee shall be composed of seven (7) commissioners and an ICCs/IPs representative from each of the first and second level employees association in the Offices for Northern and Southern Cultural Communities (ONCC/OSCC). Section 82. If they are already entitled to retirement benefits or the gratuity herein provided. national laws. furthermore. the NCIP shall issue the necessary rules and regulations.This Act will not in any manner adversely affect the rights and benefits of the ICCs/IPs under other conventions. All agreements and contracts entered into by the merged offices shall remain in full force and effect unless otherwise terminated.If the offender is a juridical person.Within sixty (60) days immediately after appointment. CHAPTER FINAL PROVISIONS XIII Section 78. Officers and employees who are to be phased-out as a result of the merger of their offices shall be entitled to gratuity a rate equivalent to one and a half (1 1/2) months salary for every year of continuous and satisfactory service rendered or the equivalent nearest fraction thereof favorable to them on the basis of the highest salary received. That this provision shall not apply to any territory which becomes part of the City of Baguio after the effectivity of this Act.L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 122 Section 73. records and documents shall be transferred to the NCIP. . administrative or other processes before the effectivity of this Act shall remain valid: Provided. rules and regulations or parts thereof inconsistent with this Act are hereby repealed or modified accordingly.Subject to rules on government reorganization. further. . Transfer of Assets/Properties. . That officials and employees of the phased-out offices who may be qualified may apply for reappointment with the NCIP and may be given prior rights in the filing up of the newly created positions of NCIP. or head of office responsible for their unlawful act shall be criminally liable therefor. international treaties. Section 75. the merged offices as aforestated shall be transferred to the NCIP without further need of conveyance. subject to the qualifications set by the Placement Committee: Provided. 122-B and 122-C.

L A W O N N A T U R A L R E S O U R C E S a n d E N V I R O N M E N T A L L A W C a s e s a n d S p e c i a l L a w s | 123 Approved: 29 October 1997. .