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CLIMAX MINING LTD Feb 28, 2005 - February 28, 2005

Issues pertinent to Mining arbitration:
1. Whether the complaint filed by petitioner raises a mining dispute over which the
Panel of Arbitrators has jurisdiction, or a judicial question which should properly
be brought before the regular courts.
A judicial question is a question that is proper for determination by the courts.
When the determination of the question involves the exercise of a judicial
The question involves the determination of what the law is and what the legal
rights of the parties are with respect to the matter in controversy.
A mining dispute is a dispute involving (a) rights to mining areas, (b) mineral
agreements, FTAAs, or permits, and (c) surface owners, occupants and
The Panel of Arbitrators has exclusive and original jurisdiction to hear and decide
these mining disputes.
2. Whether the dispute between the parties should be brought for arbitration under Rep.
Act No. 876.
The Complaint is not about a dispute involving rights to mining areas, nor is it a
dispute involving claimholders or concessionaires.
The Complaint is also not what is contemplated by Rep. Act No. 7942 when it
says the dispute should involve FTAAs.
The Complaint is not exclusively within the jurisdiction of the Panel of Arbitrators
just because, or for as long as, the dispute involves an FTAA.
The Complaint raised the issue of the constitutionality of the FTAA, which is
definitely a judicial question. The question of constitutionality is exclusively within
the jurisdiction of the courts to resolve as this would clearly involve the exercise
of judicial power. The Panel of Arbitrators does not have jurisdiction over such an
issue since it does not involve the application of technical knowledge and
expertise relating to mining.

2.) Benguet Corporation v. DENR- Mines Adjudication Board and J.G. Realty and
Mining G.R. No. 163101February 13, 2008
Facts: Benguet Corporation and J.G. Realty and Mining entered into a Royalty
Agreement with Option to Purchase (RAWOP), wherein J.G. Realty was
acknowledged as the owner of four mining claims covered by Mineral Production
Sharing Agreement (MPSA) Application
The RAWOP provides:
1. Any disputes x x x shall not be a cause of any action x x x in any court or
administrative agency but shall x x x be referred to a Board of Arbitrators
2. No action shall be instituted in court as to any matter in dispute as hereinabove
stated, except to enforce the decision of the majority of the Arbitrators.
J.G. Realty sought the cancellation of the RAWOP, filing a petition for this purpose with
the Panel of Arbitrators (POA) having territorial jurisdiction over the mining area
involved. In its Decision, the POA declared the RAWOP cancelled. The decision was
affirmed on appeal to the Mines Adjudication Board (MAB).
Issue: Whether or not the POA lacks jurisdiction over the dispute in view of the
arbitration clause?
Under Philippine domestic arbitration law, an agreement to avail of voluntary arbitration
before resort is made to the courts or quasi-judicial agencies of the government is a
valid contractual stipulation that must be adhered to by the parties.
The Court stated that there is a clear distinction between compulsory and voluntary
arbitration. The arbitration provided by the POA is compulsory, while the nature of the
arbitration provision in the RAWOP is voluntary, not involving any government agency.
An agreement to submit to voluntary arbitration must be complied with
notwithstanding the fact that the dispute involved, under the law, is also required
to be submitted to compulsory arbitration.