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The Law On Natural

The
Law
On
Natural
Resources

Resources

By: Prof. Benjamin A. Cabrido Jr.


USJ-R College of Law

MEANING OF NATURAL RESOURCES &


LAWS COVERED

Refer to the material


objects of economic value
and utility to man produced
by nature.
They constitute the
patrimony of the nation

Public Land Act (C.A. No.


141)
The Phil. Mining Act of 1995
(R.A. 7942)
The Petroleum Act of 1949
(R.A. 387)
The Coal Land Act and P.D.
972
Revised Forestry Code (P.D.
389 & 705)
The Water Code of the Phil
(P.D. 1067)
Fisheries Code of 1998 (R.A.
8550)
IPRA (R.A. 8371)

MANILA PRINCE HOTEL v. GSIS & MANILA


HOTEL, ET. AL [GR No. 122156, Feb. 3 1997]

When the Constitution


speaks of national
patrimony, it refers not
only to the natural
resources of the
Philippines, as the
Constitution could have
very well used the term
natural resources, but also
to the cultural heritage of
the Filipinos

DOCTRINE OF
CONSTITUTIONAL SUPREMACY

If a law or contract violates


any norm of the
constitution that law or
contract whether
promulgated by the
legislative or by the
executive branch or
entered into by private
persons for private
purposes is null and void
and without any force and
effect.

Since the Constitution


is the fundamental,
paramount and
supreme law of the
nation, it is deemed
written in every
statute and contract.

Justice (now CJ) Puno dissenting:

2nd par. of section 10,


Article XII of the
Constitution is pro-Pilipino
but not anti-alien;
It is pro-Filipino for it gives
preference to Filipinos

It is not, however, anti-alien


per se for it does not
absolutely bar aliens in the
grant of rights, privileges
and concessions covering the
national economy and
patrimony.
In the absence of qualified
Filipinos, the State is not
prohibited from granting
these rights, privileges and
concessions to foreigners if
the act will promote the
weal of the nation.

CONCEPT OF JURA REGALIA

It is the universal feudal theory that all lands were held from
the Crown. (Carino v. Insular Govt, 41 Phil. 935)
It is the foundation of the 1st sentence of Sec. 2, Art. XII, 1987
Constitution.
As adopted in the Republican system, the medieval concept of
jura regalia has been stripped of its regalian overtones. (Lee
Hong Kok v. David, 48 SCRA 372)

CONSTITUTIONAL PROVISIONS ON JURA


REGALIA

1st Sentence, Sec. 2, Art. XII,


1987 Constitution: ALL LANDS
OF THE PUBLIC DOMAIN,
WATERS, MINERALS, COAL,
PETROLEUM AND OTHER
MINERAL OIL, ALL FORCES OF
POTENTIAL ENERGY, FISHERIES,
FORESTS OR TIMBER, WILDLIFE,
FLORA AND FAUNA, AND OTHER
NATURAL RESOURCES ARE
OWNED BY THE STATE.

2nd Sentence, Sec. 2, Art.


XII: WITH THE EXCEPTION OF
AGRICULTURAL LANDS, ALL
OTHER NATURAL RESOURCES
SHALL NOT BE ALIENATED
3rd Sentence (Ibid): THE
EXPLORATION,
DEVELOPMENT, AND
UTILIZATION OF NATURAL
RESOURCES SHALL BE UNDER
THE FULL CONTROL AND
SUPERVISION OF THE STATE.

4th

Sentence (Ibid): THE STATE


MAY DIRECTLY UNDERTAKE
SUCH ACTIVITIES, OR IT MAY
ENTER INTO CO-PRODUCTION,
JOINT VENTURE, OR
PRODUCTION-SHARING
AGREEMENTS WITH FILIPINO
CITIZENS, OR CORPORATIONS
OR ASSOCIATIONS AT LEAST
60% OF WHOSE CAPITAL IS
OWNE BY SUCH CITIZENS.

5th Sentence (Ibid): SUCH


AGREEMENTS MAY BE FOR
PERIOD NOT EXCEEDING
TWENTY-FIVE YEARS,
RENEWABLE FOR NOT MORE
THAN TWENTY-FIVE YEARS,
AND UNDER SUCH TERMS AND
CONDITIONS AS MAY BE
PROVIDED BY LAW.

6th Sentence (Ibid): IN CASE OF WATER RIGHTS FOR


IRRIGATION, WATER SUPPLY, FISHERIES, OR INDUSTRIAL
USES OTHER THAN THE DEVELOPMENT OF WATER POWER,
BENEFICIAL USE MAY BE THE MEASURE AND LIMIT OF THE
GRANT

2nd Par. (Ibid): THE STATE


SHALL PROTECT THE NATIONS
MARINE WEALTH IN ITS
ARCHIPELAGIC WATERS,
TERRITORIAL SEA, AND
EXCLUSIVE ECONOMIC ZONE,
AND RESERVE ITS USE AND
ENJOYMENT EXCLUSIVE TO
FILIPINO CITIZENS.

3rd Par. (Ibid): THE CONGRESS


MAY, BY LAW, ALLOW SMALLSCALE UTILIZATION OF
NATURAL RESOURCES BY
FILIPINO CITIZENS, AS WELL AS
COOPERATIVE FISH FARMING,
WITH PRIORITY TO
SUBSISTENCE FISHERMEN AND
FISHWORKERS IN RIVERS,
LAKES, BAYS, AND LAGOONS

4th Par. (Ibid): THE PRESIDENT MAY ENTER INTO


AGREEMENTS WITH FOREIGN-OWNED CORPORATIONS
INVOLVING EITHER TECHNICAL OR FINANCIAL ASSISTANCE
FOR LARGE-SCALE EXPLORATION, DEVELOPMENT, AND
UTILIZATION OF MINERALS, PETROLEUM, AND OTHER
MINERAL OILS . . .

ACCORDING TO THE GENERAL


TERMS AND CONDITIONS
PROVIDED BY LAW, BASED ON
REAL CONTRIBUTIONS TO THE
ECONOMIC GROWTH AND
GENERAL WELFARE OF THE
COUNTRY. IN SUCH
AGREEMENTS, THE STATE
SHALL PROMOTE THE
DEVELOPMENT, AND USE OF
LOCAL SCIENTIFIC AND
TECHNICAL RESOURCES

Last par. (Ibid): THE


PRESIDENT SHALL NOTIFY THE
CONGRESS OF EVERY
CONTRACT ENTERED INTO IN
ACCORDANCE WITH THIS
PROVISION, WITHIN THRITY
DAYS FROM ITS EXECUTION.

JURE IMPERII vis--vis JURE GESTIONIS

See U.S. v. Ruiz, 136 SCRA 487


In public law, Imperium is the government
authority possessed by the State which is expressed
in the concept of sovereignty; Dominium is the
capacity of the State to own or acquire property.

PRESUMPTION OF STATE OWNERSHIP


OVER PUBLIC LANDS

Oh Cho v. Dir. Of Lands, 75 Phil 890: All lands that


were not acquired from the government either by
purchase or grant, belong to the public domain.
Exception: possession since time immemorial.

NATURE OF POSSESSION BY THE NATIVES (Cruz v.


Secretary, GR 135385, Dec. 6, 2000)

Ancestral domain and


ancestral lands are not part
of lands of the public
domain.
The right of natives does
not include natural
resources.
What is given is priority
rights, not exclusive right.
State not precluded from
entering into agreements
with private entities.

All embracing concept


which refers to lands,
inland waters, coastal
areas, and natural
resources therein.
Includes:
Ancestral lands,
Forests land,
Pasture land,
Residential lands
Agricultural lands, and

Other lands individually


owned whether alienable or
not;
Hunting grounds;
Burial Grounds;
Worship Areas;
Bodies of water; and
Other natural resources
Also includes land which may
no longer be exclusively
occupied by indigenous
cultural communities but to
which they had traditionally
had access for their
subsistence and traditional
activities

ANCESTRAL LAND:
Narrower in concept;
Refers to those land held
under the same conditions of
ancestral domain
BUT LIMITED TO LANDS THAT
ARE NOT MERELY OCCUPIED
AND POSSESSED BUT ARE ALSO
UTILIZED BY CULTURAL
COMMUNITIES UNDER THE
CLAIM OF INDIVIDUAL OR
TRADITIONAL GROUP
OWNERSHIP.
Includes [but not limited to]:
Residential lots, Rice terraces
or paddies, private forests,
farms and tree lots.

CONVERSION TO ALP: EXECUTIVE


PREROGATIVE

In Republic v. Reg. of Deeds of Q.C., 244 SCRA 537: The


classification of public lands is, thus, an exclusive prerogative of
the Executive Department through the Office of the President.
Courts have no authority to convert lands of public domain into
alienable and disposable lands.

TITLE OVER LAND PART


OF FOREST IS VOID

In Sunbeam v. CA, 181 SCRA 443: Before any land may be


converted into alienable or disposable land for agricultural or
other purposes, there must be positive act from the govt.
The mere fact that a title was issued by the Dir. Of Lands does not
confer owner-ship where it is part of the public forest.
See also Ituralde v. Falcasantos, G.R. No. 128017, Jan. 20, 1999.

CONSTITUTIONAL LIMITS ON JURA


REGALIA NO. 1

General Rule: All natural


resources shall not be
alienated.
Exception: Only agricultural
lands of the public domain
may be alienated.

Montano v. Insular Govt, 12


Phil. 572
Government lands and
public lands are not
synonymous terms.
GL is more extensive and
embraces not only PL but
also other lands of the govt
already reserved or
devoted to public use.
Friar lands not included as
public lands.

Nature of Friar Lands


(Strong v. Repide, 213 U.S. 419 [1909])

Friar Lands are those lands of certain haciendas which were


acquired by the U.S. government from religious
orders/corporations or organizations acquired on July 5, 1903 at a
price of $ 6,043,219.47 in gold.
Philippine Sugar Estates Development Company, Ltd. owned the
title over these lands.
Dominican lands form more than of Friar Lands.

HOW FRIAR LANDS MAY BE DISPOSED OF

In Alonso v. Cebu Country Club, G.R. 130876, Jan. 31, 2002


Under Act No. 1120, which governs the administration and
disposition of friar lands, the purchase by an actual and bona fide
settler or occupant of any portion of friar land shall be "agreed
upon between the purchaser and the Director of Lands, subject to
the approval of the Secretary of Agriculture and Natural Resources
.

Approval by the Secretary of Agriculture and Commerce of the sale


of friar lands is indispensable for its validity, hence, the absence of
such approval made the sale null and void ab-initio
Necessarily, there can be no valid titles issued on the basis of such
sale or assignment.

HOW LANDS OF THE PUBLIC DOMAIN


CLASSIFIED?

Agricultural
Forest or Timber
Mineral
National Parks

No mixed classification.
In Republic v. CA, 160 SCRA
228 (1988)
The rights over the land are
indivisible
No such thing as half
agricultural, half mineral
Once mining claim is
perfected, forest land
ceased to be so; it now
becomes completely mineral
land

SURFACE OWNER NO RIGHT OVER THE


MINERALS UNDERNEATH

No. In the exercise of the States sovereign


prerogative, use of the surface land may be
discontinued once minerals are discovered
underneath.
For his loss, the owner is entitled to compensation
under the Mining Law or in appropriate
expropriation proceedings.

HOW ARE MANGROVE SWAMPS (MANGLARES)


CLASSIFIED?

Forest Lands
In Director of Forestry v.
Villareal, G.R. 32266, Feb.
27, 1989: The
classification by the
Administrative Code of the
Phil. manglares as forest
lands has not been
changed

RULES ON THE
DISPOSITION OF ALP

Private corp./assn. cannot


acquire ALP
Private corp. may lease
maximum 1,000 hectares.
Qualified individuals can
acquire 12 has; lease up to
500 hectares
Term: 25 years; renewable
for another 25 years.

In Lausan Ayog, et al. v.


Cusi, G.R. 46729, Nov. 19,
1982:
To equitably diffuse land
ownership or to encourage
"owner-cultivatorship and
the economic family- size
farm"
Huge landholdings by
corporations or private
persons had sown social
unrest.

Exception: Corporations Validly Owning Public Lands

Maximum: 1,024 hectares


(Republic v. Quasha, G.R.
No. L-30299 Aug. 17, 1972)
Note: Americans may own
ALP (same limit) under
Parity Agreement (TydingsMcDuffie) appended in the
1935 Constitution & revised
by the Laurel-Langley
Agreement.

Under the Parity


Amendment, US citizens &
corporations may acquire
lands of the public domain.
But they cannot acquire
PRIVATE agricultural lands.
Their right is until July 3,
1974.

(Republic v. Quasha, G.R. No. L30299 Aug. 17, 1972)

LAUSAN AYOG, ET AL. v. CUSI,


G.R. 46729, Nov. 19, 1982

Vested right has to be


respected.
lt could not be abrogated
by the new Constitution.
Section 2, Article XIII of the
1935 Constitution allows
private corporations to
purchase public agricultural
lands not exceeding 1024
hectares.

RIGHTS OF NATURAL-BORN
FILIPINO WHO HAVE LOST
THEIR CITIZENSHIP

Under R.A. 8179, former


natural-born Filipino
citizens may acquire the
following:
500 sq. m. Urban land
3,000 sq. m. Rural land
For business or other
purposes.

CONSTITUTIONAL LIMITS ON JURA


REGALIA NO. 2

Exploration, Development
and Utilization of Natural
Resources must be under
Full Control and
Supervision of the State
under the constitutionally
allowed modes

ALLOWED MODES IN EDU


OF NATURAL RESOURCES

Direct Undertaking
Co-Production Agreement
Joint-Venture Agreement
Production-Sharing
Agreement
Financial or Technical
Assistance Agreement

MEANING OF FULL CONTROL


(La Bugal-Blaan Tribal Assn. vs. Ramos, G.R. 127882, Dec. 1, 2004)

Full control is not anathematic


to day-to-day management by
the contractor, provided that
the State retains the power to
direct overall strategy; and to
set aside, reverse or modify
plans and actions of the
contractor. The idea of full
control is similar to that which
is exercised by the board of
directors of a private
corporation: the performance
of managerial, operational,
financial, marketing and other
functions may be delegated to
subordinate officers or given to
contractual entities, but the
board retains full residual
control of the business.

full control and supervision


cannot be taken literally to
mean that the State controls
and supervises everything
down to the minutest details
and makes all required
actions, as this would render
impossible the legitimate
exercise by the contractor of
a reasonable degree of
management prerogative and
authority, indispensable to
the proper functioning of the
mining enterprise.

Control, as utilized in Section


2 of Article XII, must be taken
to mean a degree of control
sufficient to enable the State
to direct, restrain, regulate
and govern the affairs of the
extractive enterprises.

Such a degree of control would be


compatible with permitting the foreign
contractor sufficient and reasonable
management authority over the
enterprise it has invested in, to ensure
efficient and profitable operation.
In fine, the FTAA provisions do not
reduce or abdicate State control.

Control by the State may be


on a macro level, through the
establishment of policies,
guidelines, regulations,
industry standards and similar
measures that would enable
government to regulate the
conduct of affairs in various
enterprises, and restrain
activities deemed not
desirable or beneficial, with
the end in view of ensuring
that these enterprises
contribute to the economic
development and general
welfare of the country,
conserve the environment,
and uplift the well-being of
the local affected
communities

MEANING OF CO-PRODUCTION
AGREEMENT

An agreement between
the Government and the
contractor wherein the
Government shall provide
inputs to the mining
operations other than the
mineral resource. (Sec.
26[b], R.A. 7942, The
Philippine Mining Act of
1995)

MEANING OF JOINT VENTURE


AGREEMENT

An agreement where a
joint-venture company is
organized by the
Government and the
contractor with both
parties having equity
shares. Aside from
earnings in equity, the
Government shall be
entitled to a share in the
gross output. (Sec. 26 [c],
R.A. 7942, The Philippine
Mining Act of 1995)

MEANING OF PRODUCTION
SHARING AGREEMENT
An agreement where the
Government grants to the
contractor the exclusive right
to conduct mining operations
within a contract area and
shares in the gross output.
The contractor shall provide
the financing, technology,
management and personnel
necessary for the
implementation of this
agreement. (Sec. 26 [c], R.A.
7942, The Philippine Mining
Act of 1995)

MEANING OF FTAA
Sec. 3[r], R.A. 7942:
Financial or technical
assistance agreement means a
contract involving financial or
technical assistance for largescale exploration,
development, and utilization
of mineral resources.

The agreements involving


either technical or financial
assistance referred to in
paragraph 4 are in fact service
contracts, but such new service
contracts are between foreign
corporations acting as
contractors on the one hand,
and on the other hand
government as principal or
owner (of the works),
whereby the foreign contractor
provides the capital, technology
and technical know-how, and
managerial expertise in the
creation and operation of the
large-scale mining/extractive
enterprise, and government
through its agencies (DENR,
MGB) actively exercises full
control and supervision over the
entire enterprise.

FTAA CONSTRUED IN LA BUGAL


(G.R. No. 127882 DEC. 1, 04)

Such service contracts may be


entered into only with respect
to minerals, petroleum and
other mineral oils. The grant
of such service contracts is
subject to several safeguards,
among them: (1) that the
service contract be crafted in
accordance with a general law
setting standard or uniform
terms, conditions and
requirements; (2) the
President be the signatory for
the government; and (3) the
President report the executed
agreement to Congress within
thirty days.

ARE FTAAs
SOLELY FOR
FOREIGN
CORPORATIONS?

No. There is no basis to believe


that the framers of the
Constitution, a majority of
whom were obviously
concerned with furthering the
development and utilization of
the countrys natural resources,
could have wanted to restrict
Filipino participation in that
area. This point is clear,
especially in the light of the
overarching constitutional
principle of giving preference
and priority to Filipinos and
Filipino corporations in the
development of our natural
resources.

Filipino citizens
Private Corp./Assn. at
leash 60% of whose capital
is owned by Filipino
citizens

WHO ARE QUALIFIED


TO UNDERTAKE EDU?

CONSTITUTIONAL LIMITS ON JURA


REGALIA NO. 3

All agreements in
respect to EDU of
Natural Resources
should not exceed 25
years
Renewable for another
25 years

WATER RIGHTS NOT COVERED BY THE


25-YR LIMIT

Last sentence, 1st par.,


Sec. 2, Art. XII
IN CASES OF WATER
RIGHTS FOR IRRIGATION,
WATER SUPPLY, FISHERIES,
OR INDUSTRIAL USES
OTHER THAN
DEVELOPMENT OF WATER
POWER
MEASURE AND LIMIT OF
THE GRANT: BENEFICIAL
USE

CONSTITUTIONAL LIMITS ON JURA


REGALIA NO. 4

The use and enjoyment


of the MARINE WEALTH
of the archipelagic
waters, territorial sea
and EEZ reserved for
FILIPINO CITIZENS
ONLY.

MEANING OF ARCHIPELAGIC WATERS

The waters around,


between and
connecting the islands
of the archipelago

MEANING OF TERRITORIAL SEA

The belt of the sea


located between the coast
and internal waters of the
coastal state on the one
hand, and the high seas on
the other extending up to
12 NM from the low water
mark, or in case of
archipelagic states, from
the baselines.

MEANING OF CONTIGUOUS ZONE

The area of the sea extending up to 12 NM from the


territorial sea. Technically, it is not part of the
territory of the state; the coastal or archipelagic
state may exercise jurisdiction over the area to
prevent infringement of its customs, fiscal and
immigration or sanitary laws.

MEANING OF EXCLUSIVE ECONOMIC


ZONE (EEZ)

Area of the sea extending up to 200 NM from the


low-water mark or the baselines, as the case may
be. Technically, not part of the territory.
Coastal/Archipelagic state may exercise SOVEREIGN
RIGHTS over the economic resources of the sea,
the seabed and subsoil.
Other states have freedom of navigation &
overflight, to lay submarine cables and pipelines, &
other lawful uses.

THE EEZ OF THE PHILIPPINES

CONSTITUTIONAL LIMITS ON JURA


REGALIA NO. 5

Utilization of natural resources in rivers, lakes,


bays and lagoons.
Allowed only on a small scale to Filipino citizens or
cooperative.
Priority given to subsistence fishermen and
fisherfolk.

MARGINAL FISHERMAN VIS--VIS SUBSISTENCE


FISHERMAN

Marginal fisherman is an individual engaged in


fishing whose margin of return or reward in his
harvest of fish as measured by existing price levels
is barely sufficient to yield a profit or cover the
cost of gathering the fish.
Subsistence fisherman is one whose catch yields
but the irreducible minimum for his livelihood.

TANO V. SOCRATES,
G.R. NO. 110249, AUG. 21, 1997

The so-called "preferential right" of subsistence or


marginal fishermen to the use of marine resources
is not at all absolute.
Under the general welfare clause of the LGC, local
government units have the power, inter alia, to
enact ordinances to enhance the right of the
people to a balanced ecology.

SOME IMPORTANT LEGAL DEFINITIONS OF A


STATES FLUVIAL DOMINION

Bay a well-marked indentation whose penetration


is in such proportion to the width of its mouth as to
contain land-locked waters and constitute more
than a mere curvature of the coast. An indentation
shall not, however, be regarded as a bay unless its
area is as large as, or larger than, that of the semicircle whose diameter is a line drawn across the
mouth of that indentation. (Sec. 2, Art. 10,
UNCLOS)

Lagoon A small lake, the hollow bed of which is


bounded by elevations of land. (The Govt of the
Phil. Islands vs. Colegio de San Jose, et al., G.R. L30829, Aug. 28, 1929)
Lake - a body of water formed in depressions of the
earth. Ordinarily fresh water, coming from rivers,
brooks, or springs, and connected with the sea by
them. (Ibid)

River - is a natural waterway that transits water


through a landscape from higher to lower
elevations. It is an integral component of the water
cycle. A river may have its source in a spring, lake,
from damp, boggy landscapes where the soil is
waterlogged, from glacial melt, or from surface
runoff of precipitation.

THE PUBLIC LAND ACT (C.A. 141)

Approved: Nov. 7, 1936


Coverage: Lands of the public domain
Excludes: Timber and mineral lands; Friar Lands
Executive Officer charged to carry out the Act: DENR Secretary
Director of Lands has direct executive control of the survey,
classification, lease, sale or any other land of the public
domain
Decisions of BL Director on questions of fact appealable to
Secretary

Doctrine of Indefeasibility of Torrens title

Sec. 32, PD 1529: The decree of registration and


the certificate of title issued shall become
incontrovertible after the lapse of one year from
the date of entry
However, the State is not precluded from bringing
an action for reversion of Public Land even after
the lapse of 1 year if procured through fraud and
misrepresentation. (Republic vs. CA, G.R. No.
104296, Mar. 29, 1996)

Actions for Reversion Do Not Prescribe


[Manese v. Sps. Velasco, G.R. 164024, Jan. 29, 2009]

In all actions for the reversion to the Government


of lands of the public domain or improvements
thereon, the Republic of the Philippines is the real
party in interest.
The action shall be instituted by the Solicitor
General or the officer acting in his stead, in behalf
of the Republic of the Philippines.
Such action does not prescribe. Prescription and
laches will not bar actions filed by the State to
recover its property acquired through fraud by
private individuals.

PRE-REQUISITE FOR DISPOSITION OF ALP

Before any public land may be alienated or disposed of, it is


indispensable that there be a formal declaration by the
President upon the recommendation of the DENR Secretary to
the effect that such lands are open to disposition or
concession, and whenever practicable the lands should have
been previously surveyed. (Sec. 7, CA 141)
Excluded from disposition or concession: Those reserved for
public or quasi-public uses; those that have become private
property or subject to private right. (Sec. 9, Ibid)

MEANING OF ALIENATION OR
DISPOSTION

Alienation, disposition, or concession - means


any of the methods authorized by the C.A. 141 for
the acquisition, lease, use or benefit of the lands
of the public domain other than timber or mineral
lands. (Sec. 10, Ibid)

MODES OF DISPOSITION OF ALP

Homestead
By Sale
By Lease; and
By confirmation of imperfect or incomplete titles
through:
a) Judicial legalization
b) Administrative legalization or free patent

MATERIAL ALLEGATIONS IN APPLICATIONS FOR


GRANT OF PUBLIC LAND

Personal circumstances of the applicant and that


he/it has all the legal qualifications and none of
the disqualifications.
Purpose: use of the land according to the object
specified in the application and for other purpose,
and that the land is suitable for the purpose
contemplated.

For the exclusive use of the applicant.


Description and location of the land.
Occupancy, cultivation, improvements on the
land, if any.
Allegation that the land is not timber or mineral
land and does not contain guano or deposits of
salt or coal.

Easement of 40 meters in width from bank of any


river or stream for planting of trees of known
economic value; applicant prohibited to make any
clearing on or utilize the easement area for
ordinary farming

REQUIREMENT ON PERSONAL TILLAGE


(P.D. 152)

Applicant or his transferee must enter and work


upon, improve and cultivate the land by himself
within the periods prescribed for the various mode
of concession under the Public Land Act.
Share tenancy prohibited; violation will result to
cancellation of the grant and forfeiture of the
improvements on the land in favor of the
government.

REMEDIES FROM ADVERSE DECISION OF


BL DIRECTOR

Motion for reconsideration based on any grounds


for new trial under Rule ___; or
Appeal to the DENR Secretary
If affirmed by DENR Secretary, file a motion for
reconsideration;
If MR is denied, file special civil action on certiorari
under Rule 65.
Notes: (a) Decision of the BL cannot be collaterally
attacked; (b)

MODE NO. 1: HOMESTEAD

Concept: It is the home, the house and the


adjoining land where the head of the family dwells,
the home farm; the fixed residence of the head of
a family, with the land and buildings surrounding
the main house.
It is a legal fiction of law, an artificial estate in
land, devised to protect the possession and
enjoyment of the owner against the claims of his
creditors, by withdrawing the property from
execution and forced sale, so long as the land is
occupied as a home

Statutory Privileges Accorded to Homestead Land

1.

2.

Exempt from execution (see Sec.


13[a],Rule 39, Rules of Court and );
Cannot be held liable for satisfaction of
an obligation within (5) years from
issuance of patent (Saltiga v. CA, G.R. No.
109307, Nov. 25, 1999);

3. If validly mortgaged, right of redemption


granted within (5) years from the date of sale,
not from date of registration at the RoD. The 5year period to be reckoned from the expiration
of the one-year period under Act. 3135;
4. If validly mortgaged to a Rural bank, the 5-year
period to commence to run after the expiration
of the two-year period of redemption allowed
under R.A. 720 or the Rural Banks Act

THE PREVAILING RULE: HOMESTEAD LANDS NOT


EXEMPT FROM COVERAGE OF AGRARIAN REFORM
LAW

In Paris v. Alfeche, [G.R. No. 139083, Aug. 30,


2001):
Homesteads are not exempt from the operation
of the Land Reform Law.
The right to retain (7) hectares of land is subject to
the condition that the landowner is actually
cultivating that area or will cultivate it upon the
effectivity of the said law.

Rural Bank of Davao City vs. Court of Appeals,


217 SCRA 554, Jan. 27, 1993

If the land is mortgaged to a rural bank under R.A. No. 720, as


amended, the mortgagor may redeem the property within two
(2) years from the date of foreclosure or from the registration
of the sheriff's certificate of sale at such foreclosure if the
property is not covered or is covered, respectively, by a
Torrens title.
If the mortgagor fails to exercise such right, he or his heirs may
still repurchase the property within five (5) years from the
expiration of the two (2) year redemption period pursuant to
Sec. 119 of the Public Land Act (C.A. No. 141.

If the land is mortgaged to parties other than


rural banks, the mortgagor may redeem the
property within one (1) year from the registration
of the certificate of sale pursuant to Act No.
3135;
If he fails to do so, he or his heirs may repurchase
the property within five (5) years from the
expiration of the redemption period also
pursuant to Sec. 119 of the Public Land Act.

QUALIFIED TO OBTAIN HOMESTEAD

Filipino
18 yrs old or head of the family
Must not own more than (12) has. of land
nor has had the benefit of any gratuitous
allotment of more than (12) has. of land

If applicant is a married woman:


She must be living separately from her husband
and not dependent on him for support; or
Her husband is insane or physically incapacitated
to work;
When her husband is in prison, serving a term of
such duration as would prevent him from
complying with the requirements of the law
regarding residence of land.

Mandatory Conditions/Requirements in
Homestead Application

Within 6 months after


approval, homesteader
must start to improve and
cultivate the land;
Within a period of not less
than 1 year or more than 5
years from date of approval
of application
homesteader must have
cultivated at least 1/5 of
the land;

Continuous residency in the


same municipality where
homestead is located or in
an adjacent municipality
for at least 1 year; and
Non- abandonment
(voluntary) for more than 6
months at any one time
during period of required
residency and occupation.

When vested right in homestead fixed

In Balboa vs. Farrales,G.R. No. L-27059, Feb. 14, 1928:


After Buenaventura Balboa had submitted his final proof and
after the same had been approved by the Government, and
while Act No. 926 was still in force, he became the owner of
the land and "entitled to a patent."
At least on that date his right to the land, as owner, ripened
into a vested right. It was no longer expectant as depending on
the continuance of existing circumstances, or contingent as
depending on some events or the performance of some
conditions.

WHEN HOMESTEAD IS DEEMED CONJUGAL PROPERTY


(De Ocampo v. Delizo, G.R. No. L-32820, Jan. 20,
1976)
The fact that a parcel of land was acquired as
homestead during the period of the first marriage
does not necessarily mean that it should be
considered as property of the first marriage. The
decisive factor in determining whether a parcel of
land acquired by way of homestead is conjugal
property of the first or second marriage, is not
necessarily the issuance of the homestead patent
but the time of the fulfillment of the requirements
of the public land law for the acquisition of such
right.

CONDITIONS BEFORE APPLICANT MAY VALIDLY


TRANSFER HIS RIGHTS BEFORE ISSUANCE OF
PATENT

He has already complied with all the requirements;


His non-continuance is of no fault of his own;
Made to a bona fide purchaser legally qualified to
apply for homestead;
Not for speculative purpose; and
Approved by the Director, Bureau of Lands

RESTRICTIONS ON SUBSEQUENT ALIENATION


AND ENCUMBRANCE (Sec. 118, C.A. 141 as
amended by C.A. 456)

Homestead cannot encumbered or alienated during the period


from date of approval up to the date of issuance of patent;
Encumbrance or alienation within 5 years from date of issuance
of patent or grant is prohibited;
Homestead cannot be liable to the satisfaction of any debt
contracted prior to the expiration of said period;
Exception: Improvements or crops on the homestead land
Alienation, transfer, or conveyance after 5 years and before 25
years requires approval of the DENR Secretary (deemed as
directory and formality)

Nature of Proceedings in Homestead

Not in rem, hence a homestead patent


issued is not binding upon the whole world;
However, when a homestead patent is
registered under the Torrens System, its
title becomes indefeasible.

RULES ON THE EXERCISE OF THE RIGHT OF


REDEMPTION/REPURCHASE OF HOMESTEAD
LAND

5 years if mortgaged or sold to a private person or the subject


of sale under pacto de retro;
6 years If mortgaged covered under Act 3135;
7 years If mortgaged to a Rural Bank;
None If sold to immediate member of a family.
None If land is no longer devoted to agriculture, patentee is
already 71 years old not anymore residing in the property and
his motivation for the repurchase was purely for profit.
(Santana v. Marinas, G.R. No. L-35537, Dec. 27, 1979)
Note: Period must be reckoned from the date of conveyance or
sale.

R.A.10023 [Free Patents To


Residential Lands] March 9, 2010

Coverage :
1. All lands that are zoned as residential areas,
including townsites as defined under the Public
Land Act. Exception: Forest Areas
2. Zoned residential areas located inside a delisted
military reservation or abandoned military camp, and
those of local government units (LGUs) or townsites
which preceded Republic Act No. 7586 or the
National Integrated Protected Areas System
(NIPAS) law.

Qualified Applicants:
Any Filipino citizen who
is an actual occupant of
a residential land.
Maximum Area:
Highly urbanized cities
200 square meters
Other cities 500
square meters
First class and second
class municipalities
750 square meters

All other municipalities


1,000 square meters.
Provided that the land
applied for is not
needed for public
service and/or public
use.

How to Apply

Application should be
supported by:
A map based on an actual
survey conducted by a
licensed geodetic engineer
and approved by the
Department of Environment
and Natural Resources
(DENR)
A technical description of
the land.

Affidavit of two (2)


disinterested persons who
are residing in the barangay
of the city or municipality
where the land is located;
Attesting to the truth of the
facts contained in the
application to the effect that
the applicant thereof has,
either by himself or through
his predecessor-in-interest,
actually resided on and
continuously possessed
and occupied, under a bona
fide claim of acquisition of
ownership, the land applied
for at least ten (10) years
and has complied with the
requirements prescribed in
Section 1 hereof.

Special Patents [Sec.


4, RA 10023]

Any public land actually


occupied and used for
public schools, municipal
halls, public plazas or parks
and other government
institutions for public use or
purpose can be issued with
Special Patents.

Conditions:
Issuance is not contrary to
law; and
Subject to private rights
Lands issued Special
Patents cannot be disposed
of unless sanctioned by
Congress if owned by the
national agency or
sanctioned by the
sanggunian concerned
through an approved
ordinance if owned by the
LGU.

Miscellaneous Sales
Patent [R.A. 730]

Permits sale without public


auction of alienable and
disposable lands of the
public domain for residential
purpose.
The application to purchase
the land is called the
Miscellaneous Sales
Application and the
corresponding patent is
called the Miscellaneous
Sales Patent.

Qualified to apply:
1. Filipino citizen of lawful
age, married (if single,
applicant must be the head
or bread winner of the
family)
2. Not the owner of a home lot
in the municipality/city
where the land applied for
is located
3. He must have occupied in
good faith the land applied
for and constructed a
house thereon where
he/she and family is
actually residing.

Requirements under
R.A. 730
Application Filing fee of
P50.00;
Approved plan and
technical description of the
land applied for;
Affidavit of the applicant
stating that:

He is not the owner of any


other home lot in the
municipality/city where he
resides.
He is requesting that the
land be sold to him under
the provision of R. A. No.
730.

If the applicant is single, he


must submit an affidavit
stating that he is the head
or bread winner of the
family;
The land is not needed for
public use.
The applicant can only be
granted a maximum area of
1,000 square meters.
Presidential Decree No.
2004 dated December 30,
1985 amended Section 2 of
Republic Act 730 thus,
lands acquired under this
Act before and after the
issuance of patent thereon
are no longer subject to any
restriction.

MODE NO. 2 : SALE OF PUBLIC


AGRICULTURAL LANDS
Qualified to purchase:
Filipino citizens, legal age or head of the
family;
Maximum area: 12 hectares
Note: Corporations cannot acquire by
purchase Public Agricultural Lands by
express prohibition under Sec. 3, Art. XII,
1987 Constitution

PREFERENCE GIVEN TO ACTUAL


OCCUPANTS (Sec. 25, CA 141)
Conditions:
ALP must not be located: (a) within 10 kms from
the boundaries of the city proper in chartered
cities; or (b) within 5 kms from the municipal hall
or town plaza of any municipality.
There must actual occupation on the lands.
Total landholdings must not exceed 5 hectares

EXCESS LANDHOLDING WHEN ALLOWED

In case of foreclosure sale;


However, the excess must be disposed of
within 5 years;
Failure to dispose of within the period
surtax of 50% will be charged over the
ordinary real property tax.

WHAT IS DEEMED EXCESS LANDHOLDING?

For qualified individuals: the area in excess of 12


hectares.
For corporations: Any land acquired by virtue of
foreclosure is deemed in excess of landholding
hence must be disposed of within 5 years.

PROCEDURE IN THE SALE OF ALP

Filing of application in prescribed form.


Appraisal conducted by the BL Director and approved by the
DENR Secretary.
Publication of the notice of sale: Once a week for 3 consecutive
weeks in the O.G., and in 2 newspapers, one published in
Manila and the other in the municipality or province where the
land is situated.
Posting in the Bulletin Board of the LMB, Q.C. and in 3
conspicuous places in the provincial capitol and the municipal
hall where the land is situated

Submission of Bids in sealed envelope, addressed


to the BL Director together with the 10% amount
of the bid in cash, certified check, treasury
warrant, or postal money order.
Opening of bids and awarding to the highest
bidder.

PREFERENCE GRANTED TO APPLICANT


IN AWARDING OF ALP

In case of two or more highest equal bids and one


belongs to applicant, latter wins;
If the highest bid is not that of applicant, Oral
Bidding is called and the highest oral bidder is
awarded;
In all instances, applicant is given the option to
equal the highest bidder.

Payment of price may be in full or in 10 equal


annual installments reckoned from the date of
the award.
Overdue installment subject to 4% interest P.A.
Purchasers right over the ALP is still inchoate
until such time the patent has already been
issued.

CONDITIONS IN SALE ARE OBLIGATORY


(Jimenez v. Macaraig, G.R. 94542, Mar. 1,
1993
)
Facts: Jimenez
was awarded by way of sale ALP for town site in

1955. It was subject to condition that he will commence


construction of improvements within 6 months and complete all
within 18 months from date of award. In 1972, Guirnalda
occupied the land, cleared it and introduced levelling and
riprapping. She also built a shack which was used by her and
her family. In 1984, the daughter of Jimenez asked her to
vacate the land. Guirnalda filed a protest with the BL as sought
for cancellation of the award. In 1986, BL cancelled the award.
On MR, it was reversed but set aside by the DENR Secretary.

Ruling:
Jimenez was not able to prove that the
improvements were commenced, hence the
rescission of the award was proper;
But, the rescission did not amount to recognition
of other occupants claim on the subject land.
Whatever claim that Guirnalda has over the land
must still be presented before the proper forum
and must under proper procedure as set by law.

TWO INSTANCES WHEN


ORAL BIDDING ALLOWED

When two or more of such sealed bids turn out to


be equal and the highest, and that of the applicant
is not one of them. In such case, the Director of
Lands will call for an oral bidding, without need for
applicant to participate in it since he has the
option to put up a bid to equal that of the highest
bidder; and
Where the ALP to be sold has been declared to be
vacant and no applicant is recognized to have
preferential rights over it.

PRE-REQUISITES BEFORE
SALES PATENT IS ISSUED

He must have occupied the land applied for;


He must have cultivated at least 1/5 of the land
within 5 years after the date of award;
Where the application is for pasture, he must have
grazed on the land with his own cattle numbering
at the rate of one head for every 2 hectares;
Failure to comply or any voluntary abandonment
for ore than one year at any given time, the land
may be reverted and all prior payments forfeited.

CONVEYANCE OF LAND PRIOR TO


ISSUANCE OF SALES PATENT VALID
Sec. 29 allows applicant to convey or encumber his
rights after cultivation has started;
CONDITIONS:
It does not affect the interest of the government;
The transferor is not delinquent in paying the
installment due; and
There must be prior approval of the DENR
Secretary

EFFECT OF SALE WITHOUT DENR APPROVAL


(Javier v. C.A., et al., 231 SCRA 498, Mar. 28,
1994)

The sale pending issuance of patent without


approval of the BL violates Sec. 29, C.A. 141.
The effect is annulment of the sales application as
if none had been filed.

JOINT VENTURE ALLOWED IN SALE OF PUBLIC


LAND [Barreo v. Rivera, 61 O.G. 14, April 5,
1965 CA]

Where one person contributes his capital, consisting of his duly


approved sales application and recognized right of possession
over a parcel of public land which he has begun cultivating and
over which he has already spent time and effort, and another
contributes his labor and money to finalize the cultivation of
the same land, with the understanding that both shall divide
the land in the proportion agreed upon by them, a joint
venture or partnership is formed under Art. 1767 of the Civil
Code, and each partner is bound as a trustee to be ever loyal
to his partner under Art. 1807 of the same Code.

BUT JOINT VENTURE NOT SANCTIONED IN


HOMESTEAD [Addun v. De Yro, 62 O.G. 37, Sept.
12, 1966 CA]
In the case of homestead, however, the treatment
of a similar situation apparently is different.
A homestead applicant is required by law to
occupy and cultivate the land for his own and his
familys benefit, and not for the benefit of
someone else.

If the homesteader occupies and cultivates the


land on behalf of another person and obtains
title on the understanding that a portion would
be transferred to the latter, it is INVALID, hence
bars issuance of the patent;
Even if patent is already issued and title becomes
indefeasible, the same agreement is still null and
void since Sec. 118 prohibits the encumbrance or
alienation of a homestead except in favor of the
government or any of its branches from the date
of the approval of the application and for a term
of 5 years from the date of issuance of patent.

RESTRICTIONS IN
SALE OF PUBLIC LAND
1)
2)
3)
4)

5)

Survey plan must be made before issuance of


sales patent;
Mineral deposits not included in conveyance;
Land subject to legal servitudes;
Subject to ROW not exceeding 60 m in width for
public highways, railroad, irrigation canals,
aqueduct, etc.;
After grant of title, subsequent transfer within 10
years from grant or cultivation is not valid
without consent from the state.

WHEN LAND BECOMES OF PRIVATE OWNERSHIP [Visayan


Realty Inc. v. Meer, 96 Phil 515]

It is only upon issuance of the sales patent that the


Government is divested with its title.
Approval of the application merely authorizes
applicant to take possession of the land in order for
him to comply with the requirements set by law.
Meanwhile, the Government still remains the
owner; the application can still be cancelled and
the land awarded to another if it is shown the
requirements are not complied with.

WHEN LAND UNDER SALES PATENT IS DEEMED


EXCLUSIVE PROPERTY [Fiel, et al. v. Wagas, et
al., 48 O.G. 195]
Where the balance of the purchase price of
the land applied for sales patent was paid
by applicant after the dissolution of the
marriage due to death of his spouse, the
land is considered exclusive property of the
applicant;
This is true even if the sales patent
application was filed and approved during
the subsistence of the marriage.

ANNULMENT OF PATENT AND TITLE IS


JUDICIAL IN NATURE

True that the Director of Lands can


investigate violations even while the patent
and the corresponding title have already
been issued;
But he cannot render a decision annulling
the sales patent and title for the alleged
violations since annulment of a title under
Sec. 101 of CA 141 is a judicial process.

MODE NO. 3: LEASE OF ALP


Qualified to lease ALP:
Filipino citizen of legal age (up to 500 hectares);
and
Private corporation or association registered
under the laws of the Philippines whose capital
stock of at least 60% is owned by Filipinos (up to
1,000 hectares).

LIMITATIONS IN THE LEASE OF ALP

Any officer, employee, stockholder, etc. of a


corporation/association already holding ALP may
not apply for lease of such land. In case it may be
allowed, it must be reasonably necessary to carry
on his business, in case of an individual or the
business for which the corporation is created under
its Articles of Incorporation.

PROCEDURE IN THE LEASE OF ALP


(Substantially the same as in sale)

Filing of application in prescribed form.


Appraisal conducted by the BL Director and approved by the
DENR Secretary.
Publication of the notice of sale: Once a week for 3 consecutive
weeks in the O.G., and in 2 newspapers, one published in
Manila and the other in the municipality or province where the
land is situated.
Posting in the Bulletin Board of the LMB, Q.C. and in 3
conspicuous places in the provincial capitol and the municipal
hall where the land is situated

Submission of Bids in sealed envelope, addressed to the BL


Director together with the 10% amount of the bid in cash,
certified check, treasury warrant, or postal money order.
Opening of bids and awarding to the highest bidder.
In addition:

No bid will be considered if the proposed rent is less than 3%


of the appraised value of the land or the bidder did not
deposit rental equivalent to at least the first 3 months of the
lease.
If the land applied for is for grazing, annual rental must not
be less than 2%.

OTHER CONDITIONS IN LEASE OF ALP

Rental: to be paid in advance starting from the date of


approval of the lease; subject to automatic increase if the rent
falls below 3% in case of re-appraisal.
Period: 25 years, renewable for another 25 years. Extension is
not a matter of right. Lessee must justify the extension by
showing he has introduced important improvements on the
leased land.
Cultivation: Applicant must have broken and cultivated at least
1/3 of the land within 5 years from approval.

RESTRICTION TO SUB-LEASE

Lessee cannot assign, encumber, or sublet his right


over the leased land without approval from the
DENR Secretary.
Reason: To avoid speculation purposes or situation
where the land is used by other persons not legally
qualified to lease ALP.

CAN THE LESSEE SUBLEASE THE


IMPROVEMENTS ON THE LAND WITHOUT
CONSENT FROM GOVT?

No. In Bachrach Motor Co. Inc. v. Universal Trading


Co. Inc., et al., 62 O.G. 30, July 25, 1966, it was
ruled:
In lease contract of ALP, a provision is found that
upon the breach thereof by the lessee, the govt
as lessor may elect to declare the lease forfeited
and enter and take possession of the premises and
ALL IMPROVEMENTS actually existing thereon.
Hence, this can only mean that the improvements
are also subject to forfeiture.

ADDITIONAL RESTRICTIONS

Lessee cannot remove or dispose of any valuable


timber, stone, oil, coal, salts or other minerals,
including medicinal mineral waters.
The leased land is subject to the same conditions
and restriction imposed on sale of ALP regarding
taxes, servitudes, easements, mines and water
rights

PREFERENCE OF LESSEE TO BUY LEASED


LAND

If the ALP leased is to be sold by the


Government during the subsistence of the
lease, LESSEE will have the option to
purchase the property, subject to conditions
and restrictions governing sale of ALP.

LESSEE HAS LEGAL STANDING TO OPPOSE


REGISTRATION OF ALP OBJECT IN LEASE

If lessee has already introduced substantial


improvements on the leased land, he is considered
a party in interest entitled to file opposition in
application for registration of the same land.
The trial court may be compelled by mandamus to
allow the lessee and his counsel to appear and
oppose the application (Director v. Del Rosario, 58
O.G. 3, Jan. 15, 1962)

REGISTRATION OF LEASE CONTRACT NOT


NECESSARY

True that any alienation, grant, conveyance on public lands is


not effective unless registered in the office of the RD (Sec.
122, Act 496)
However, a contract of lease of ALP does not constitute title or
deed of conveyance within the meaning of the above provision.
What the law contemplates are those transfers of ownership,
not documents transferring mere possession (Dagdag v.
Nepomuceno, 10 Phil. 216).

MODE NO. 4: CONFIRMATION OF


IMPERFECT OR INCOMPLETE TITLE
I.

I.

BY JUDICIAL LEGALIZATION
- When application is filed with the proper RTC
in the province or city where the land lies; or
BY FREE PATENT When the application is
filed with the Bureau of Lands.

JUDICIAL LEGALIZATION

When to file: Until Dec. 31, 2020 (period extended by R.A.


9176)
Where to file: RTC in the province or city where the land lies.
Notice of the application with the survey plan must be
furnished the OSG, the Bureau of Lands.
Publication of the notice of initial hearing once a week for 3
consecutive weeks in the O.G., and in 2 newspapers, one
published in Manila and the other in the municipality or
province where the land is situated.
Posting in the Bulletin Board of the LMB, Q.C. and in 3
conspicuous places in the provincial capitol and the municipal
hall where the land is situated

PERSONS ENTITLED TO JUDICIAL LEGALIZATION/


CONFIRMATION OF IMPERFECT/INCOMPLETE
TITLE
(a) Those who prior to the transfer of sovereignty
from Spain to the US 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 land
continuously since the filing of their application;

(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 of
ownership, SINCE JUNE 12, 1945, immediately
preceding the filing of the application of
confirmation of title, except when prevented by
war or force majeure. 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
provision of P.D. 1073; and

(c) Members of the national cultural minorities


who by themselves or through their predecessorsin-interest have been in open, continuous,
exclusive and notorious possession and occupation
of lands of the public domain suitable to
agriculture, whether disposable or not, under a
bona fide claim of ownership since June 12, 1945.

REGISTRATION UNDER LAND REGISTRATION


ACT V. REGISTRATION UNDER THE PUBLIC
LAND ACT

Under the Land Registration Act:


- presumption that title already exists and the
court is there only to confirm;
- dismissal may be with or without prejudice to
refiling; and
- applicant does not risk losing his property.

Under the Public Land Act:


- land applied for presumed to belong to the
State and applicant is claiming it by virtue of his
open, continuous, exclusive and notorious
possession amounting to imperfect title;
- court hearing the application has jurisdiction
and power to adjudicate the land in favor of the
conflicting claimants, and if none is entitled, land
is declared in favor of the Government; and
- applicant runs the risk of losing the land applied
for, without opportunity of refiling the
application.

PRESCRIPTION LIES AGAINST ALP (Jabutay v.


Dir. Of Lands, CA G.R 16969, Nov. 7 1958)
In the case where the applicant was able to establish that he
and his predecessors-in-interest had been in actual, peaceful,
public, open and continuous possession of certain public land
under claim of ownership for more than 65 years, he is deemed
to have been conferred effective title and the subject land had
ceased to a part of the public domain and had become a
private property.
Note: Generally, 30 years possession without title and in bad faith
is enough in acquisitive prescription. However, in ALP,
possession must be traced since June 12, 1945.

ACQUISITION BY ADMIN LEGALIZATION OR


FREE PATENT

Persons entitled:
- Natural-born Filipino;
- Not owner of more than 24 hectares (now 12 hectares;
- Since July 4, 1945 or prior thereto, has continuously occupied
and cultivated, either by himself or through his predecessorsin-interest, such public lands as may be subject of disposition;
- In lieu of continuous cultivation, applicant may show that he
has paid real estate taxes on the property for the same period
and the land has not been occupied by other persons.

LIMITATIONS IN AREA

Royal decrees: 1,000 hectares;


R.A. 6236 & P.D. 1073: 144 hectares;
1973 Constitution: 24 hectares; and
1987 Constitution: 12 hectares.

PROCEDURE IN OBTAINING FREE


PATENT

Filing of Application with BL, accompanied with a map and


technical description of the land, and affidavits subscribed by
two disinterested persons residing the same municipality or
barangay where the land lies;
Posting of notices in conspicuous places in the provincial
capital, the municipality and barangay where the land is
situated for 2 consecutive weeks. Notice shall require those
having interests to file their objection or adverse claim; and
Action by the BL.

WHEN FREE PATENT BECOMES FINAL AND


CONCLUSIVE

General rule: 1 year after issuance of the


free patent, title over the land becomes
indefeasible and incontrovertible.
Exception: Where the land granted is not
part of the public domain, but a private
land, the patent and Torrens Title issued are
a nullity.

IMPORTANT RESTRICTION
ON FREE PATENT

Land cannot be encumbered or alienated within 5 years from


date of issuance, except in favor of the government or its
instrumentalities.
Improvements or crops not covered.
After 5 years, the land may be alienated without need of
approval from the DENR.
But it buyer is a juridical person, there must be consent from
the grantee and approval from DENR
Any alienation is subject to right of repurchase by the
patentee, his heirs within 5 years from date of sale.

ALIENABLE PUBLIC LANDS OTHER THAN


TIMBER, MINERAL OR AGRICULTURAL
Reclaimed lands;
Foreshore;
Marshy land or land covered with water bordering
upon the shores or banks of navigable lakes or
rivers; and
Other lands not included in above classification.
Note: The foregoing may be disposed of for
residential, commercial, industrial or other
productive purposes.

MEANING OF TERMS

Residential land: To be construed in its prospective and


objective purposes taking into account the influx of population
and the impact of commercial, industrial and social intercourse
thereon. A truly residential lot could not be converted into an
agricultural land simply by reserving a plot for cultivation;
conversely, an agricultural land cannot be considered
residential simply because a portion of it has been crisscrossed
with roads and building here and there.
Reclaimed land: refers to submerged land which by deliberate
act of dredging and filling has emerged to the surface. It
belongs to the State. It may be declared property of adjoining
owners only where it is no longer needed for public use or
public service.

Foreshore: refers to that part of the land adjacent to the sea


which is alternately covered and uncovered by the ordinary
flow of the tides. It belongs to the State.
Note: R.A. 1899, Reclamation Act of 1957 declares as property
of the LGU all reclaimed land undertaken by them.
Marshy land: that which borders on shores and banks of
navigable rivers and lakes; it is generally swampy or soft wet
land.
Note: All foregoing may be subject, as a rule, only of lease
unless declared so by the President upon recommendation of
the DENR or by legislation, i.e. R.A. 293, as amended by R.A.
1899 (June 22, 1957) allowing sale of marshy land with
subsisting lease of at least 5 years to the lessee.

CASES ON RECLAIMED LANDS

Republic v. C.A. & Republic Real Estate Corp, G.R. No. 105276,
November 25, 1998.
Chavez v. PEA & Amari, G.R. No. 133250, July 9, 2002, en banc
decision;

REPUBLIC V. CA & REPUBLIC REAL ESTATE


CORP., G.R. No. 105276, November 25, 1998

The duty of the court is to interpret the enabling


Act, RA 1899. In so doing, we cannot broaden its
meaning, much less widen the coverage thereof.
If the intention of Congress were to include
submerged areas, it should have provided
expressly. That Congress did not so provide could
only signify the exclusion of submerged areas
from the term "foreshore lands".

CHAVEZ vs. PEA and AMARI

[G.R. No.
133250, July 9, 2002, en banc decision]
Facts:
November 20, 1973: Commissioner of Public
Highways, signed a contract with the Construction
and Development Corporation of the Philippines
("CDCP" for brevity) to reclaim certain foreshore
and offshore areas of Manila Bay. The contract also
included the construction of Phases I and II of the
Manila-Cavite Coastal Road. CDCP obligated itself
to carry out all the works in consideration of fifty
percent of the total reclaimed land.

February 4, 1977: Marcos issued Presidential


Decree No. 1084 creating PEA with primary
mandate "to reclaim land, including foreshore and
submerged areas," and "to develop, improve,
acquire, x x x lease and sell any and all kinds of
lands."
On the same date, Presidential Decree No. 1085
was signed transferring to PEA the "lands
reclaimed in the foreshore and offshore of the
Manila Bay" under the Manila-Cavite Coastal Road
and Reclamation Project (MCCRRP).

December 29, 1981: Pres. Marcos issued a


memorandum directing PEA to amend its contract
with CDCP directing that all future works in
MCCRRP shall be funded and owned by PEA.
January 19, 1988: Pres.Aquino issued Special
Patent No. 3517, granting and transferring to PEA
the parcels of land already reclaimed under the
Manila-Cavite Coastal Road and Reclamation
Project (MCCRRP) containing a total area of one
million nine hundred fifteen thousand eight
hundred ninety four (1,915,894) square meters.

April 9, 1988: Paraaque RD issued TCT Nos.


7309, 7311, and 7312, in the name of PEA,
covering the three reclaimed islands known as the
"Freedom Islands" located at the southern portion
of the Manila-Cavite Coastal Road, Paraaque
City.
The Freedom Islands have a total land 157.841
hectares.

April 25, 1995: PEA entered into a JVA with AMARI


to develop the Freedom Islands. The JVA also
required the reclamation of an additional 250
hectares of submerged areas surrounding these
islands to complete the configuration in the
Master Development Plan of the Southern
Reclamation Project-MCCRRP. The JVA was
entered without public bidding.

April 28, 1995: PEA Board confirmed the JVA.


June 8, 1995, Pres. Ramos approved the JVA.
November 29, 1996: then Senate Pres. Maceda
delivered a privilege speech calling the JVA as the
"grandmother of all scams. A senate
investigation followed.

April 27, 1998: petitioner Chavez, as taxpayer,


filed a petition for mandamus contending that the
government stands to lose billions of pesos in the
sale by PEA of the reclaimed lands to AMARI.
Petitioner assails the sale to AMARI of lands of the
public domain as a blatant violation of Section 3,
Article XII of the 1987 Constitution prohibiting the
sale of alienable lands of the public domain to
private corporations.

March 30, 1999: PEA and AMARI signed the


Amended Joint Venture Agreement.
May 28, 1999: President Estrada approved the
Amended JVA.
The Amended JVA covers a reclamation area of
750 hectares. Only 157.84 hectares of the 750hectare reclamation project have been
reclaimed, and the rest of the 592.15 hectares
are still submerged areas forming part of Manila
Bay.

Under the Amended JVA, AMARI will reimburse


PEA the sum of P1,894,129,200.00 for PEA's
"actual cost" in partially reclaiming the Freedom
Islands.
AMARI will also complete, at its own expense, the
reclamation of the Freedom Islands. AMARI will
further shoulder all the reclamation costs of all
the other areas, totaling 592.15 hectares, still to
be reclaimed.

AMARI and PEA will share, in the proportion of 70


percent and 30 percent, respectively, the total
net usable area which is defined in the Amended
JVA as the total reclaimed area less 30 percent
earmarked for common areas.
Under the Amended JVA AMARI will acquire and
own a maximum of 367.5 hectares of reclaimed
land which will be titled in its name.

PRINCIPAL ISSUE

WHETHER THE STIPULATIONS IN THE AMENDED


JOINT VENTURE AGREEMENT FOR THE TRANSFER
TO AMARI OF CERTAIN LANDS, RECLAIMED AND
STILL TO BE RECLAIMED, VIOLATE THE 1987
CONSTITUTION.

RATIO DECIDENDI

The ownership of lands reclaimed from foreshore


and submerged areas is rooted in the Regalian
doctrine which holds that the State owns all lands
and waters of the public domain.
Commonwealth Act No. 141, also known as the
Public Land Act, which authorized the lease, but
not the sale, of reclaimed lands of the
government to corporations and individuals. CA
No. 141 continues to this day as the general law
governing the classification and disposition of
lands of the public domain.

The State policy prohibiting the sale to private


parties of government reclaimed, foreshore and
marshy alienable lands of the public domain, first
implemented in 1907 was thus reaffirmed in CA
No. 141 after the 1935 Constitution took effect .
Foreshore lands became inalienable as natural
resources of the State, unless reclaimed by the
government and classified as agricultural lands of
the public domain, in which case they would fall
under the classification of government reclaimed
lands.

After the effectivity of the 1935 Constitution,


government reclaimed and marshy disposable
lands of the public domain continued to be only
leased and not sold to private parties.
These lands remained sui generis, as the only
alienable or disposable lands of the public domain
the government could not sell to private parties.
Since then and until now, the only way the
government can sell to private parties
government reclaimed and marshy disposable
lands of the public domain is for the legislature to
pass a law authorizing such sale.

CA No. 141 does not authorize the President to


reclassify government reclaimed and marshy lands
into other non-agricultural lands under Section 59
(d).
Lands classified under Section 59 (d) are the only
alienable or disposable lands for non-agricultural
purposes that the government could sell to
private parties.
Most importantly, Section 60 of CA No. 141
expressly requires congressional authority before
lands under Section 59 that the government
previously transferred to government units or
entities could be sold to private parties

One reason for the congressional authority is that


Section 60 of CA No. 141 exempted government
units and entities from the maximum area of
public lands that could be acquired from the
State.
These government units and entities should not
just turn around and sell these lands to private
parties in violation of constitutional or statutory
limitations.

The 1987 Constitution continues the State policy in the 1973


Constitution banning private corporations from acquiring any
kind of alienable land of the public domain. Like the 1973
Constitution, the 1987 Constitution allows private
corporations to hold alienable lands of the public domain only
through lease.
One purpose of the constitutional prohibition against
purchases of public agricultural lands by private corporations
is to equitably diffuse land ownership or to encourage 'ownercultivatorship and the economic family-size farm'. Huge
landholdings by corporations or private persons had spawned
social unrest."

The Amended JVA covers not only the Freedom


Islands, but also an additional 592.15 hectares
which are still submerged and forming part of
Manila Bay.
There is no legislative or Presidential act
classifying these submerged areas as alienable or
disposable lands of the public domain open to
disposition.
There can be no dispute that these submerged
areas form part of the public domain, and in their
present state are inalienable and outside the
commerce of man.

The mere fact that alienable lands of the public


domain like the Freedom Islands are transferred
to PEA and issued land patents or certificates of
title in PEA's name does not automatically make
such lands private.
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.

SUMMARY OF THE RULING:

The 157.84 hectares of reclaimed lands


comprising the Freedom Islands, now covered by
certificates of title in the name of PEA, are
alienable lands of the public domain. PEA may
lease these lands to private corporations but may
not sell or transfer ownership of these lands to
private corporations. PEA may only sell these
lands to Philippine citizens, subject to the
ownership limitations in the 1987 Constitution
and existing laws.

The 592.15 hectares of submerged areas of Manila Bay remain


inalienable natural resources of the public domain until
classified as alienable or disposable lands open to disposition
and declared no longer needed for public service. The
government can make such classification and declaration only
after PEA has reclaimed these submerged areas. Only then
can these lands qualify as agricultural lands of the public
domain, which are the only natural resources the government
can alienate. In their present state, the 592.15 hectares of
submerged areas are inalienable and outside the commerce
of man.

Since the Amended JVA seeks to transfer to


AMARI, a private corporation, ownership of 77.34
hectares of the Freedom Islands, such transfer is
void for being contrary to Section 3, Article XII of
the 1987 Constitution which prohibits private
corporations from acquiring any kind of alienable
land of the public domain.

Since the Amended JVA also seeks to transfer to AMARI


ownership of 290.156 hectares of still submerged areas of
Manila Bay, such transfer is void for being contrary to Section
2, Article XII of the 1987 Constitution which prohibits the
alienation of natural resources other than agricultural lands
of the public domain. PEA may reclaim these submerged
areas. Thereafter, the government can classify the reclaimed
lands as alienable or disposable, and further declare them no
longer needed for public service. Still, the transfer of such
reclaimed alienable lands of the public domain to AMARI will
be void in view of Section 3, Article XII of the 1987
Constitution which prohibits private corporations from
acquiring any kind of alienable land of the public domain.

CHAVEZ vs. PEA and AMARI

[G.R. No. 133250,


November 11, 2003 Resolution of MR]

Submerged lands, like the waters (sea or bay) above them, are
part of the States inalienable natural resources. Submerged
lands are property of public dominion, absolutely inalienable
and outside the commerce of man. This is also true with
respect to foreshore lands. Any sale of submerged or foreshore
lands is void being contrary to the Constitution.
Commonwealth Act No. 141, "foreshore and lands under water
were not to be alienated and sold to private parties,"

PEA is the central implementing agency tasked


to undertake reclamation projects nationwide
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.
In the hands of PEA, which took over the leasing
and selling functions of DENR, 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

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.
PEA will simply turn around, as PEA has now
done under the Amended JVA, and transfer
several hundreds of hectares of these reclaimed
and still to be reclaimed lands to a single private
corporation in only one transaction.

This scheme will effectively nullify the constitutional ban in


Section 3, Article XII of the 1987 Constitution which was
intended to diffuse equitably the ownership of alienable
lands of the public domain among Filipinos, now numbering
over 80 million strong.
As we held in our 9 July 2002 Decision, the Amended JVA
"violates glaringly Sections 2 and 3, Article XII of the 1987
Constitution.
In our 6 May 2003 Resolution, we DENIED with FINALITY
respondents Motions for Reconsideration. Litigations must
end some time. It is now time to write finis to this
"Grandmother of All Scams."

SURVEY OF RECLAMATION LAWS


AND REGULATIONS

The Spanish Law of Waters of 1866


Civil Code of 1889
Act No. 1654
Act No. 2874 ;
Commonwealth Act No. 141;
R.A. 1899
PD No. 1084
R.A. 7160

Executive Order 525, February 14, 1979 (Designating PEA as


the Agency primarily responsible for all reclamation projects)
Executive Order 543, June 24, 2006 (Delegating to PRA the
power to approve reclamation projects)
Executive Order No. 380, Oct. 26, 2004 (Transforming PEA
into PRA)
Executive Order No. 586
Executive Order No. 654
Presidential Decree No. 1085

THE SPANISH LAW OF WATERS OF 1866

Article 5. Lands reclaimed from the sea in


consequence of works constructed by the State, or
by the provinces, pueblos or private persons, with
proper permission, shall become the property of
the party constructing such works, unless otherwise
provided by the terms of the grant of authority.

CIVIL CODE OF 1889 (Arts. 339 & 341)


Art. 339. Property of public dominion is:
1. That devoted to public use, such as roads, canals,
rivers, torrents, ports and bridges constructed by
the State, riverbanks, shores, roadsteads, and that
of a similar character;

2. That belonging exclusively to the State which,


without being of general public use, is employed
in some public service, or in the development of
the national wealth, such as walls, fortresses, and
other works for the defense of the territory, and
mines, until granted to private individuals.
Art. 341. Property of public dominion, when no
longer devoted to public use or to the defense of
the territory, shall become a part of the private
property of the State.

ACT NO. 1654, PHILIPPINE COMMISSION


(MAY 8, 1907)

Section 1. The control and disposition of the


foreshore as defined in existing law, and the title
to all Government or public lands made or
reclaimed by the Government by dredging or filling
or otherwise throughout the Philippine Islands,
shall be retained by the Government without
prejudice to vested rights and without prejudice to
rights conceded to the City of Manila in the Luneta
Extension.

Section 2.
(a) The Secretary of the Interior shall cause all Government
or public lands made or reclaimed by the Government by
dredging or filling or otherwise to be divided into lots or
blocks, with the necessary streets and alleyways located
thereon, and shall cause plats and plans of such surveys to be
prepared and filed with the Bureau of Lands.
(b) Upon completion of such plats and plans the GovernorGeneral shall give notice to the public that such parts of the
lands so made or reclaimed as are not needed for public
purposes will be leased for commercial and business
purposes, x x x.
(e) The leases above provided for shall be disposed of to the
highest and best bidder therefore, subject to such regulations
and safeguards as the Governor-General may by executive
order prescribe.

Synopsis: Act 1654

Act No. 1654 mandated that the government should


retain title to all lands reclaimed by the
government. The Act also vested in the government
control and disposition of foreshore lands. Private
parties could lease lands reclaimed by the
government only if these lands were no longer
needed for public purpose.

Act No. 1654 mandated public bidding in the


lease of government reclaimed lands. Act No.
1654 made government reclaimed lands sui
generis in that unlike other public lands which the
government could sell to private parties, these
reclaimed lands were available only for lease to
private parties.

Act No. 1654 did not repeal Section 5 of the Spanish Law of
Waters of 1866. Act No. 1654 did not prohibit private parties
from reclaiming parts of the sea under Section 5 of the
Spanish Law of Waters. Lands reclaimed from the sea by
private parties with government permission remained private
lands.

ACT 2874 [Nov. 29, 1919]

Sec. 6. The Governor-General, upon the recommendation of


the Secretary of Agriculture and Natural Resources, shall from
time to time classify the lands of the public domain into ?
(a) Alienable or disposable,
(b) Timber, and
(c) Mineral lands, x x x.
Sec. 7. For the purposes of the government and disposition of
alienable or disposable public lands, the Governor-General,
upon recommendation by the Secretary of Agriculture and
Natural Resources, shall from time to time declare what lands
are open to disposition or concession under this Act."

Sec. 8. Only those lands shall be declared open to disposition


or concession which have been officially delimited or
classified x x x.
Sec. 55. Any tract of land of the public domain which, being
neither timber nor mineral land, shall be classified as suitable
for residential purposes or for commercial, industrial, or
other productive purposes other than agricultural purposes,
and shall be open to disposition or concession, shall be
disposed of under the provisions of this chapter, and not
otherwise.

Sec. 56. The lands disposable under this title shall


be classified as follows:
(a) Lands reclaimed by the Government by
dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water
bordering upon the shores or banks of navigable
lakes or rivers;
(d) Lands not included in any of the foregoing
classes.

Sec. 58. The lands comprised in classes (a), (b),


and (c) of section fifty-six shall be disposed of to
private parties by lease only and not otherwise,
as soon as the Governor-General, upon
recommendation by the Secretary of Agriculture
and Natural Resources, shall declare that the
same are not necessary for the public service and
are open to disposition under this chapter. The
lands included in class (d) may be disposed of by
sale or lease under the provisions of this Act.

C.A. 141 [PUBLIC LAND ACT] Nov. 7, 1936

Sec. 58. Any tract of land of the public domain


which, being neither timber nor mineral land, is
intended to be used for residential purposes or
for commercial, industrial, or other productive
purposes other than agricultural, and is open to
disposition or concession, shall be disposed of
under the provisions of this chapter and not
otherwise.

Sec. 59. The lands disposable under this title shall


be classified as follows:
(a) Lands reclaimed by the Government by
dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water
bordering upon the shores or banks of navigable
lakes or rivers;
(d) Lands not included in any of the foregoing
classes.

Sec. 60. Any tract of land comprised under this


title may be leased or sold, as the case may be,
to any person, corporation, or association
authorized to purchase or lease public lands for
agricultural purposes.

Sec. 61. The lands comprised in classes (a), (b),


and (c) of section fifty-nine shall be disposed of
to private parties by lease only and not
otherwise, as soon as the President, upon
recommendation by the Secretary of Agriculture,
shall declare that the same are not necessary for
the public service and are open to disposition
under this chapter. The lands included in class (d)
may be disposed of by sale or lease under the
provisions of this Act.

Section 61 of CA No. 141 readopted, after the


effectivity of the 1935 Constitution, Section 58 of
Act No. 2874 prohibiting the sale of government
reclaimed, foreshore and marshy disposable lands
of the public domain.
All these lands are intended for residential,
commercial, industrial or other non-agricultural
purposes. As before, Section 61 allowed only the
lease of such lands to private parties.

The government could sell to private parties only


lands falling under Section 59 (d) of CA No. 141,
or those lands for non-agricultural purposes not
classified as government reclaimed, foreshore and
marshy disposable lands of the public domain.
Foreshore lands, however, became inalienable
under the 1935 Constitution which only allowed
the lease of these lands to qualified private
parties.

The Civil Code of 1950

Art. 420. The following things are property of public


dominion:
(1) Those intended for public use, such as roads,
canals, rivers, torrents, ports and bridges constructed
by the State, banks, shores, roadsteads, and others of
similar character;
(2) Those which belong to the State, without being for
public use, and are intended for some public service or
for the development of the national wealth.
x x x.
Art. 422. Property of public dominion, when no longer
intended for public use or for public service, shall form
part of the patrimonial property of the State.

Government must formally declare that the property of


public dominion is no longer needed for public use or public
service, before the same could be classified as patrimonial
property of the State.
In the case of government reclaimed and marshy lands of the
public domain, the declaration of their being disposable, as
well as the manner of their disposition, is governed by the

applicable provisions of CA No. 141.

Like the Civil Code of 1889, the Civil Code of 1950 included as
property of public dominion those properties of the State
which, without being for public use, are intended for public
service or the "development of the national wealth."
Thus, government reclaimed and marshy lands of the State,
even if not employed for public use or public service, if
developed to enhance the national wealth, are classified as
property of public dominion.

Dispositions under the 1973


Constitution [Sec. 8, Art. XIV]

Sec. 8. All lands of the public domain, waters,


minerals, coal, petroleum and other mineral oils,
all forces of potential energy, fisheries, wildlife,
and other natural resources of the Philippines
belong to the State.

With the exception of agricultural, industrial or


commercial, residential, and resettlement lands of
the public domain, natural resources shall not be
alienated, and no license, concession, or lease for
the exploration, development, exploitation, or
utilization of any of the natural resources shall be
granted for a period exceeding twenty-five years,
renewable for not more than twenty-five years,
except as to water rights for irrigation, water
supply, fisheries, or industrial uses other than the
development of water power, in which cases,
beneficial use may be the measure and the limit of
the grant."

Both the 1935 and 1973 Constitutions prohibit the


alienation of all natural resources except
agricultural lands of the public domain.
However, the 1973 Constitution limits the
alienation of lands of the public domain to
individuals who were citizens of the Philippines.
Private corporations, even if wholly owned by
Philippine citizens, were no longer allowed to
acquire alienable lands of the public domain
unlike in the 1935 Constitution.

PD No. 1084, Feb. 4, 1977 [PEA


CHARTER]

Sec. 4. Purpose. The Authority is hereby created for the


following purposes:
(a) To reclaim land, including foreshore and submerged
areas, by dredging, filling or other means, or to acquire
reclaimed land;
(b) To develop, improve, acquire, administer, deal in,
subdivide, dispose, lease and sell any and all kinds of lands,
buildings, estates and other forms of real property, owned,
managed, controlled and/or operated by the government;
(c) To provide for, operate or administer such service as may
be necessary for the efficient, economical and beneficial
utilization of the above properties.

Sec. 5. Powers and functions of the Authority. The Authority


shall, in carrying out the purposes for which it is created,
have the following powers and functions:
(a) To prescribe its by-laws.
xxx
(i) To hold lands of the public domain in excess of the area
permitted to private corporations by statute.
(j) To reclaim lands and to construct work across, or
otherwise, any stream, watercourse, canal, ditch, flume x x
x.
xxx
(o) To perform such acts and exercise such functions as may
be necessary for the attainment of the purposes and
objectives herein specified.

PD No. 1084 authorizes PEA to reclaim both


foreshore and submerged areas of the public
domain.
Foreshore areas are those covered and uncovered
by the ebb and flow of the tide.
Submerged areas are those permanently under
water regardless of the ebb and flow of the tide.
Foreshore and submerged areas indisputably
belong to the public domain and are inalienable
unless reclaimed, classified as alienable lands
open to disposition, and further declared no
longer needed for public service.

The ban in the 1973 Constitution on private


corporations from acquiring alienable lands of
the public domain did not apply to PEA since
it was then, and until today, a fully owned
government corporation.
In order for PEA to sell its reclaimed foreshore
and submerged alienable lands of the public
domain, there must be legislative authority
empowering PEA to sell these lands pursuant
to Sec. 60, C.A. 141.

Without such legislative authority, PEA could


not sell but only lease its reclaimed foreshore
and submerged alienable lands of the public
domain.
Reclaimed alienable lands of the public
domain would still be subject to the
constitutional ban on private corporations
from acquiring alienable lands of the public
domain.
Hence, such legislative authority could only
benefit private individuals.

Dispositions under the 1987


Constitution

Section 2. All lands of the public domain,


waters, minerals, coal, petroleum and other
mineral oils, all forces of potential energy,
fisheries, forests or timber, wildlife, flora and
fauna, and other natural resources are owned
by the State. With the exception of
agricultural lands, all other natural resources
shall not be alienated. The exploration,
development, and utilization of natural
resources shall be under the full control and
supervision of the State. x x x.

Section 3. Lands of the public domain are classified


into agricultural, forest or timber, mineral lands, and
national parks. Agricultural lands of the public domain
may be further classified by law according to the uses
which they may be devoted. Alienable lands of the
public domain shall be limited to agricultural lands.
Private corporations or associations may not hold
such alienable lands of the public domain except by
lease, for a period not exceeding twenty-five years,
renewable for not more than twenty-five years, and
not to exceed one thousand hectares in area.
Citizens of the Philippines may lease not more than
five hundred hectares, or acquire not more than
twelve hectares thereof by purchase, homestead, or
grant.

Taking into account the requirements of


conservation, ecology, and development, and
subject to the requirements of agrarian
reform, the Congress shall determine, by law,
the size of lands of the public domain which
may be acquired, developed, held, or leased
and the conditions therefor.

Rationale Of The Constitutional Ban

Without the constitutional ban, individuals who


already acquired the maximum area of alienable lands
of the public domain could easily set up corporations to
acquire more alienable public lands.
An individual could own as many corporations as his
means would allow him. An individual could even hide
his ownership of a corporation by putting his nominees
as stockholders of the corporation.
The corporation is a convenient vehicle to circumvent
the constitutional limitation on acquisition by
individuals of alienable lands of the public domain.

The Revised Administrative Code of 1987

A later law than either PD No. 1084 or EO No. 525, vests in the
Department of Environment and Natural Resources ("DENR" for
brevity) the following powers and functions:
"Sec. 4. Powers and Functions. The Department shall:
(1) x x x
xxx
(4) Exercise supervision and control over forest lands,
alienable and disposable public lands, mineral resources
and, in the process of exercising such control, impose
appropriate taxes, fees, charges, rentals and any such form of
levy and collect such revenues for the exploration,
development, utilization or gathering of such resources;
xxx

(14) Promulgate rules, regulations and guidelines


on the issuance of licenses, permits, concessions,
lease agreements and such other privileges
concerning the development, exploration and
utilization of the country's marine, freshwater, and
brackish water and over all aquatic resources of
the country and shall continue to oversee,
supervise and police our natural resources; cancel
or cause to cancel such privileges upon failure,
non-compliance or violations of any regulation,
order, and for all other causes which are in
furtherance of the conservation of natural
resources and supportive of the national interest;

(15) Exercise exclusive jurisdiction on the


management and disposition of all lands of the
public domain and serve as the sole agency
responsible for classification, sub-classification,
surveying and titling of lands in consultation
with appropriate agencies."

DENR is vested with the power to authorize the


reclamation of areas under water.
PEA is vested with the power to undertake the
physical reclamation of areas under water,
whether directly or through private contractors.
DENR is empowered to classify lands of the public
domain into alienable or disposable lands subject
to the approval of the President.
PEA is tasked to develop, sell or lease the
reclaimed alienable lands of the public domain.

PEA's Authority to Sell Reclaimed Lands

PEA's charterexpressly tasks PEA "to develop, improve, acquire,


administer, deal in, subdivide, dispose, lease and sell any and
all kinds of lands x x x owned, managed, controlled and/or
operated by the government.
There is legislative authority granted to PEA to sell its lands,
whether patrimonial or alienable lands of the public domain.
PEA may sell to private parties its patrimonial properties in
accordance with the PEA charter free from constitutional
limitations.
The constitutional ban on private corporations from acquiring
alienable lands of the public domain does not apply to the sale
of PEA's patrimonial lands.

PEA may also sell its alienable or disposable lands


of the public domain to private individuals since,
with the legislative authority, there is no longer
any statutory prohibition against such sales and the
constitutional ban does not apply to individuals.
PEA, however, cannot sell any of its alienable or
disposable lands of the public domain to private
corporations since Section 3, Article XII of the 1987
Constitution expressly prohibits such sales.
The legislative authority benefits only individuals.
Private corporations remain barred from acquiring
any kind of alienable land of the public domain,
including government reclaimed lands.

The provision in PD No. 1085 stating that portions of


the reclaimed lands could be transferred by PEA to the
"contractor or his assignees" would not apply to private
corporations but only to individuals because of the
constitutional ban.
Otherwise, the provisions of PD No. 1085 would violate
both the 1973 and 1987 Constitutions.

Requirement of public auction in the sale


of reclaimed lands

PEA must observe the provisions of Sections 63 and 67


of CA No. 141 requiring public auction, in the absence
of a law exempting PEA from holding a public auction.
Section 79 of PD No. 1445 otherwise known as the
Government Auditing Code, requires government to sell
valuable government property through public bidding.
It is only when the public auction fails that a
negotiated sale is allowed, in which case the
Commission on Audit must approve the selling price

At the public auction sale, only Philippine


citizens are qualified to bid for PEA's reclaimed
foreshore and submerged alienable lands of the
public domain.
Private corporations are barred from bidding at
the auction sale of any kind of alienable land of
the public domain.

Republic Act No. 6957 [BOT Law]

Sec. 6. Repayment Scheme. - For the financing,


construction, operation and maintenance of any
infrastructure projects undertaken through the buildoperate-and-transfer arrangement or any of its
variations pursuant to the provisions of this Act, the
project proponent x x x may likewise be repaid in the
form of a share in the revenue of the project or other
non-monetary payments, such as, but not limited to,
the grant of a portion or percentage of the reclaimed
land, subject to the constitutional requirements with
respect to the ownership of the land: x x x.

R.A. 1899 [Authorizing Chartered


Cities & Municipalities to reclaim]

All municipalities, and chartered cities may undertake


and carry out at their own expense the reclamation by
dredging, filling, or other means, of any foreshore lands
bordering them, and may establish, provide, construct,
maintain and repair proper and adequate docking and
harbor facilities as such municipalities and chartered
cities may determine in consultation with the Secretary
of Finance and the Secretary of Public Works and
Communications.
Any and all lands reclaimed shall become property of
the respective municipalities or chartered cities.
However, the new foreshore along the reclaimed areas
shall continue to be the property of the National
Government.

Municipalities and chartered cities are


authorized to contract indebtedness with any
person, association, corporation, or lending
institution and may issue bonds in such
amounts and under such terms and conditions
as may be fixed by the Secretary of Finance.
Such bonds shall be guaranteed by the
Government of the Philippines and their issue,
servicing and liquidation shall be undertaken
by the Central Bank of the Philippines.

All lands reclaimed, except such as may be necessary


for wharves, piers and embankments, roads, parks
and other public improvements, may be sold or leased
under such rules and regulations as the municipality
or chartered city may prescribe.
All proceeds derived from such sale or lease, and all
berthing and other fees and such other earnings as
the municipality or chartered city shall derive from
the use of the port facilities and improvements, shall
be credited to a special fund which shall accrue in the
first instance to the sinking fund.
Any balance thereof in excess of periodic sinking fund
requirements shall be available for other permanent
public improvements of the municipality or chartered
city.

Republic Act 7160 [Local Govt Code]

"Section 302. Financing, Construction,


Maintenance, Operation, and Management of
Infrastructure Projects by the Private Sector.
In case of land reclamation or construction of
industrial estates, the repayment plan may consist
of the grant of a portion or percentage of the
reclaimed land or the industrial estate constructed.

Although Section 302 of the Local Government Code


does not contain a proviso similar to that of the BOT
Law, the constitutional restrictions on land ownership
automatically apply even though not expressly
mentioned in the Local Government Code.
Either the BOT Law or the Local Government Code,
the contractor or developer, if a corporate entity, can
only be paid with leaseholds on portions of the
reclaimed land.
If the contractor or developer is an individual,
portions of the reclaimed land, not exceeding 12
hectares of non-agricultural lands, may be conveyed
to him in ownership in view of the legislative
authority allowing such conveyance.

Registration of lands of the public domain

Registration of land under Act No. 496 or PD No.


1529 does not vest in the registrant private or
public ownership of the land. Registration is not a
mode of acquiring ownership but is merely
evidence of ownership previously conferred by any
of the recognized modes of acquiring ownership.
Registration does not give the registrant a better
right than what the registrant had prior to the
registration.
The registration of lands of the public domain
under the Torrens system, by itself, cannot convert
public lands into private lands.

EXECUTIVE ORDER NO. 525

PEA shall be primarily responsible for integrating,


directing, and coordinating all reclamation projects
for and on behalf of the National Government.
All reclamation projects shall be approved by the
President upon recommendation of the PEA, and
shall be undertaken by the PEA or through a proper
contract executed by it with any person or entity;
Provided, that, reclamation projects of any
national government agency or entity authorized
under its charter shall be undertaken in
consultation with the PEA upon approval of the
President.