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Bracewell v.

Court of Appeals
G.R. No. 107427 January 25, 2000
JAMES R. BRACEWELL, petitioner,
vs.
HONORABLE COURT OF APPEALS and REPUBLIC OF THE PHILIPPINES,
respondents.
Facts:
The controversy involves a total of nine thousand six hundred fifty-seven (9,657) square meters
of land located in Las Pias, Metro Manila.
In 1908, Maria Cailles, married to James Bracewell, Sr., who acquired the said parcels of land
from the Dalandan and Jimenez families of Las Pias; after which corresponding Tax
Declarations were issued in the name of Maria Cailles.
On January 16, 1961, Maria Cailles sold the said parcels of land to her son, the petitioner, by
virtue of a Deed of Sale which was duly annotated and registered with the Registry of Deeds of
Pasig, Rizal. Tax Declarations were thereafter issued in the name of petitioner, canceling the
previous Tax Declarations issued to Maria Cailles.
On September 19, 1963, petitioner filed before the then Court of First Instance of Pasig, Rizal an
action for confirmation of imperfect title under Section 48 of Commonwealth Act No. 141.
The Director of Lands, represented by the Solicitor General, opposed petitioner's application on
the grounds that neither he nor his predecessors-in-interest possessed sufficient title to the subject
land nor have they been in open, continuous, exclusive and notorious possession and occupation
of the same for at least thirty (30) years prior to the application, and that the subject land is part
of the public domain.
On May 3, 1989, the lower court issued an Order granting the application of petitioner. The
Solicitor General promptly appealed to respondent Court which, on June 29, 1992, reversed and
set aside the lower court's Order. It also denied petitioner's Motion for Reconsideration in its
Resolution of September 30, 1992.
Issues:
a) Whether the failure of the petitioner to prosecute his action for an unreasonable length of
time?
b) Whether the tax declarations attached to the complaint do not constitute acquisition of the
lands applied for?
Held:

The controversy is simple. On one hand, petitioner asserts his right of title to the subject land
under Section 48 (b) of Commonwealth Act No. 141, having by himself and through his
predecessors-in-interest been in open, continuous, exclusive and notorious possession and
occupation of the subject parcels of land, under a bona fide claim of acquisition or ownership,
since 1908. On the other hand, it is the respondents' position that since the subject parcels of land
were only classified as alienable or disposable on March 27, 1972, petitioner did not have any
title to confirm when he filed his application in 1963. Neither was the requisite thirty years
possession met.
A similar situation in the case of Reyes v. Court of Appeals, where a homestead patent issued to
the petitioners' predecessor-in-interest was cancelled on the ground that at the time it was issued,
the subject land was still part of the public domain.
In the said case, this Court ruled as follows
Under the Regalian doctrine, all lands of the public domain belong to the State, and that the State
is the source of any asserted right to ownership in land and charged with the conservation of such
patrimony. This same doctrine also states that all lands not otherwise appearing to be clearly
within private ownership are presumed to belong to the State (Director of Lands vs. Intermediate
Appellate Court, 219 SCRA 340).
Hence, the burden of proof in overcoming the presumption of State ownership of lands of the
public domain is on the person applying for registration. The applicant must show that the land
subject of the application is alienable or disposable. These petitioners failed to do.
The homestead patent was issued to petitioners' predecessor-in-interest, the subject land belong
to the inalienable and undisposable portion of the public domain. Thus, any title issued in their
name by mistake or oversight is void ab initio because at the time the homestead patent was
issued to petitioners, as successors-in-interest of the original patent applicant, the Director of
Lands was not then authorized to dispose of the same because the area was not yet classified as
disposable public land. Consequently, the title issued to herein petitioners by the Bureau of
Lands is void ab initio.
Neither has petitioner shown proof that the subject Forestry Administrative Order recognizes
private or vested rights under which his case may fall. We only find on record the Indorsement of
the Bureau of Forest Development from which no indication of such exemption may be gleaned.
Having found petitioner to have no cause of action for his application for confirmation of
imperfect title, we see no need to discuss the other errors raised in this petition.

EN BANC
G.R. No. L-7670

March 28, 1914

CARMEN AYALA DE ROXAS, plaintiff-appellant,


vs.
THE CITY OF MANILA, defendant-appellant.
Haussermann, Cohn & Fisher for appellant.
City Attorney Nesmith for appellee.
MORELAND, J.:
Doa Carmen Ayala de Roxas, the plaintiff in this case, was in 1901, 1902, and 1903, and has
since been, the owner of certain property on the Escolta numbered 98-104, which was and is
known and designated on the books and ta-roll of the city of Manila as lot 3, block 35, district of
Binondo. This property was assessed for taxation by the officials of the city of Manila for the
years 1901 and 1902 as follows:
Land .....................................................
.......

P205,407.00

Improvements ......................................
......

30,000.00

Total ..........................................
..

235,407.00

the taxes levied during the two years pursuant to the assessment were duly paid by the plaintiff.
On the 8th of January, 1903, the Philippine Commission passed an Act, No. 581, for the purpose,
expressed in the title, of creating a board of tax revision to revise the assessments of real estate
and improvements in the city of Manila. The board therein created, in the performance of the
duty laid upon it by said Act, reassessed the plaintiff's property on April 4, 1903, fixing the value
thereof at P120,534 for the land and P50,000 for the improvements, in all P170,534.
In February, 1903, plaintiff commenced the reconstruction of the improvements on said land at a
costs of P25,000, and on April 4, 1903, when the commission appointed in pursuance of Act No.
581 made the reassessment of plaintiff's property, the latter was then in the act of reconstructing,
altering and making additions to the improvements on said land.

On November 3, 1903, Act No. 975 was passed authorizing and requiring the Municipal Board
"in all cases in which land assessed for taxation in the city of Manila for the years 1902 and 1902
was assessed at more than fifty per centum above the assessment" for 1903, as fixed by the board
of tax revision, to reduce the assessments for 1901 and 1902 to the amount fixed in the
assessment for 1903. This Act then went on to provide:
SEC. 2. In all cases in which the money has been paid upon the excessive assessment as
described in section one, either for one or two years, the city tax assessor and collector shall
allow the amount of such excess payment to be applied upon the taxes due nineteen hundred and
three, or some subsequent year.
It is alleged in the amended complaint, admitted by the defendant, and found as a fact by the
court that on December 10, 1903, the plaintiff made inquiry as to the amount of the 1903 taxes
upon the premises in question; that she was informed by the city assessor and collector that the
tax for that year was P2,558.02, but that she was entitled to a refund under Act No. 975 of
P2,121.80 arising from the excessive assessments of 1901, 1902, which assessments had been
revised and reduced as aforesaid by the tax revision commission appointed under Act No. 581.
The plaintiff thereupon paid the difference between P2,558.02 and P2,121.80, or P436.22, taking
a receipt in full for the sum of P2,558.02, the taxes for 1903.
The refund under the statute was made by the city assessor and collector in pursuance of a
resolution of the Municipal Board of the city of Manila passed on December 8, 1903, as follows:
Whereas the city assessor and collector has submitted a statement showing all cases in which
land assessed for taxation in the city of Manila for the years 1901 and 1902, was assessed at
more than 50 per cent above the assessment for the year 1903, as revised by the board of tax
revision; and
Whereas, by Act No. 975, the Municipal Board is authorized and required to reduce the
assessment for the years 1901 and 1902 to the amount fixed by the board of tax revision for the
same land in 1903: Be it, therefore, on motion,
Resolved, that by virtue of Act No. 975, the city assessor and collector is hereby authorized and
directed to make such reductions in the assessment, and, in all cases in which the money has
been paid upon such excessive assessment, to allow the amount of such excess payments to be
applied on the taxes due for the year 1903, or some subsequent year.
In the statement mentioned in said resolution appears the entry of the property in question as
follows:
Owner.

Lot. Block. Assessed


value in
U.S.
currency
for 1901
and1902.

Revised Excess
Excess
value
assessment. payment.
for1903.

Carmen
Ayala

35

$102,703

$60,237 $42,466

$1,060.90

On January 6, 1911, the Collector of Internal Revenue issued to the chief of the real estate
division written instructions as follows:
Referring to the attached papers regarding the decision of the Supreme Court in cases involving
the interpretation of Act No. 975, I desire to have this matter again tested in the courts by
collecting from a few large taxpayers the amounts refunded to them in 1903 under the
interpretation of Act no. 975 by the city assessor and collector, which, according to the Supreme
Court, was an erroneous interpretation. You will therefore arrange to enter on the 1903 tax rolls
back taxes for the year 1903 against the properties shown on the attached list in amounts equal to
the refunds granted by the city assessor and collector under Act No. 975. notices regarding these
entries should be forwarded to each of the taxpayers as per the attached form as soon as possible
and at such time so as to enable the putting of such properties on the list for the next tax sale if
payments of these back taxes are not made.
Pursuant to these instructions the following letter was sent to and received by the plaintiff:
Subject: Decision of the Supreme Court, re Act No. 975.
JANUARY 11, 1911.
MRS. CARMEN AYALA,
No. 154 Malacaang, Manila.
MADAM: You are informed that the Supreme Court of these Islands has, in two decisions, one
in the case of Felipe Zamora against the city of Manila, and the other in the case of Jose P.
Paterno against the city of Manila, held that the word `land' as used in section 1 of Act No. 975
of the Philippine Commission includes both the land and the buildings thereon. As construed by
the city assessor and collector the word `land,' as used in the above-mentioned Act, did not
include the improvements upon the land, and therefore the credit of P2,121.80 allowed by the
city assessor and collector on the tax lists for the year 1903 as a partial payment of the tax on
your property located at Nos. 98-104 Escolta, known as lot 3, block 35, district of Binondo, was
erroneously applied according to the construction of the said Act by the Supreme Court in the
cases above stated, since the total value of the property in question, as per assessment in 1901
and 1902, was not 50 per cent more than the value fixed by the board of tax revision, although
the value of the land was 50 per cent more than 1901 and 1902 than that fixed by the board of tax
revision.
By direction of the Municipal Board of Manila, approved by His excellency, the GovernorGeneral, the amount above stated which has been applied as a partial payment of your real estate
tax for 1903 has been entered on the tax lists for 1903 and is a lien upon the said property, which
can only be removed by the payment of the proper amount.

By authority contained in a resolution adopted by the Municipal Board on December 10, 19010,
the payment of the said sum, which is a delinquent tax for 1903, will be accepted without penalty
if made within twenty days from the date this communication is received by you.
Very respectfully,
(Sgd.) ELLIS CROMWELL,
Collector of Internal Revenue,
Ex Officio City Assessor and Collector.
To clear her property of this alleged encumbrance and to prevent the collector from carrying into
effect his threat to sell the property at public sale, plaintiff, under protest, paid the city assessor
and collector the P2,121.80 demanded, which sum is now in special deposit in the Insular
Treasury awaiting the outcome of this action.
This action was begun by the plaintiff to recover the said amount paid as aforesaid. The learned
trial court dismissed the complaint on the merits and this appeal is taken from that judgment.
The defendant states its position in this controversy as follows:
From the figures set forth above, relating to plaintiff's property, it appears that the land alone was
assessed during 1901 and 1902 at more than 50 per cent, in fact 70 per cent, above the valuation
fixed for 1903, but that the land and improvements together were assessed during 1901 and 1902
at less than 50 per cent, in fact, only 38 per cent, above the valuation fixed for 1903.
Consequently, if the word "land" as used in Act No. 975 were to be construed as "land only" then
plaintiff was entitled to a refund of a certain amount of excess paid, but if by "land" the
legislature contemplated "land and improvements" or "real estate in general" then the plaintiff
was not entitled to any refund. The city assessor and collector erroneously adopted the former
construction as the correct one and estimated that the proper amount of refund of the excess
payment by the plaintiff for the years 1901 and 1902, as provided in Act No. 975, would be the
sum of P2,121.80. . . .
Subsequent to this payment, however, the Supreme Court decided in the case of Felipe Zamora
vs. City of Manila (7 Phil. Rep., 584) that the word "land" as used in Act No. 975 should not be
construed in a limited sense but that it was intended by the legislature to include not only the
land as such but also the improvements thereon. The city assessor and collector, by direction of
the municipal board approved by the Governor-General, then addressed a letter to the plaintiff
explaining the mistake of the collector made in 1903, and stating that this amount of P2,121.80
had been entered upon the tax lists for 1903, and that it was a lien upon her property only to be
removed by payment of the proper amount, which if paid within a certain time would be received
without penalty. This the plaintiff then paid to the city assessor under protest and now brings this
action for the recovery back of the P2,121.80 so paid.
From what has been said, it is clear that the basic contention of the city is that the city assessor
and collector erroneously, and, therefore, unlawfully, refunded to the plaintiff herein, when she
paid her tax in 1903, the sum of P2,121.80, and that, having so wrongly and unlawfully refunded

that sum by the proves, as the city council called it, of putting it on the lists for 1903. the reason
for claiming that this sum was unlawfully and erroneously refunded is that the word 'land,' as
used in Act No. 975, was held by the Supreme Court in the case of Zamora vs. City of Manila (7
Phil. Rep., 584), to include the word "improvements," and that this Act requiring also, prior to
the right to refund in any given case, that the assessments for the years 1901 and 1902 should be
more than 50 per cent higher than was the assessment of the same property in 1903, the basis on
which the right rest does not exist, for, while the land itself was assessed in 1901 and 1902 about
70 per cent higher than it was in 1903, the improvements upon the land were assessed almost
twice as high in 1903 as in 1901 and 1902, and while a rebate might be allowed upon the
assessment on the land if it had not been held by the Supreme Court to include improvements, no
rebate can, in fact, be allowed, because the assessments of the land and improvements, under the
decision referred to, must be taken, that is, added, together; and that being the case, the
assessments of both land and improvements for the years 1901 and 1902 were not, when added
together, 50 per cent higher than the total of the two was in 1903. As a necessary result, says the
city, the refund was improper.
This contention may be answered in two ways. In the first place, section 46 No. 183 provides
that "it shall be the duty of every owner of real estate in the city of Manila to prepare or cause to
be prepared a statement of the amount of land and the improvements thereon which he owns."
This statement must be filed with the city assessor and collector and from it, primarily, he makes
up the list of the taxable real estate in the city. Under the system established by this Act and by
the practice which was adopted and has been consistently followed under it, the improvements
are assessed separately fro the land even though both may be owned by the same person. This
was the way the assessment was made in 1901, 1902 and 1903, and it is the manner in which
assessments have been made since that time. This was the condition of assessments when the
remedial Act referred to was passed and presents the situation which the commission had before
it. This being so, it might with propriety be contended that an owner of land might have been
entitled to the refund provided for in Act No. 975 with respect to the improvements. The fact that
the Supreme Court held, in the case referred to, that, under the statute, land included
improvements, does not necessarily mean that the contention of the city is correct that the
assessment for both land and improvements as made in 1901 and 1902 should have been added
together and the sum of the two compared with the total assessments for land and improvements
as made in 1903 before it could be determined whether the taxpayer was entitled to a refund. In
the case referred to the plaintiff, as guardian for his minor children, brought suit against the city
of Manila to recover the excess taxes paid to the city under the assessments of 1901 and 1902.
The assessments for that year were, land P7,000, and house P8,000. In 1903 the assessment was,
land P4,476, and house P5,000. The plaintiff claimed a right to the refund on both the land and
the house but the department of assessments and collections of the city allowed it on the land
only, denying the benefits of the Act with regard to the improvements upon the theory that the
Act referred to land only. This court held in that case that, inasmuch as the statute was remedial,
the plaintiff was entitled, under the liberal construction given to that kind of statute, to a refund
not only as to the taxes on the land but also as to those on the improvements. In that case the
assessments were treated separately, the one relating to the land and the other to the
improvements, each one standing upon its own footing, the plaintiff evidently being permitted to
claim her right as to each apart from the other.

In the second place, it may be said, in answer to the city's contention that there was no
reassessment made in 1903 of the improvements assessed in 1901 and 1902, and that, therefore,
there was no basis from which it could be determined whether the improvements were assessed
higher in 1901 and 1902 than they were in 1903 or vice versa. When the assessment was made
by the commission in 1903 the taxpayer was engaged in making very extensive improvements
upon the premises, to a large extent rebuilding the buildings already thereon. It is undisputed that
she was adding at least P25,000 worth of repairs to the premises at that time. It is very probable
that, in making the assessment, the commission took into consideration these improvements and
added their value to the improvements as they were assessed in 1901 and 1902. This appears to
be so not only from the fact that it was that time impracticable to assess the improvements as
they existed in 1901 and 1902, but also from the fact that the assessed valuation of the
improvements in 1903 was almost double what it was in 1901 and 1902. this latter fact is
significant for the reason that the assessments in 1901 and 1902 were almost universally
excessive so much so in fact that it led the Legislature in 1903, as we have seen, to pass a
special Act for a reassessment of city property and the refunding of money paid as taxes under
the excessive assessments of those years. This being the case, it would be but fair to assume that,
if the improvements as assessed in 1901 and 1902 had been assessed in 1903, the value thereof
would have been largely reduced. As a matter of fact, however, due undoubtedly to the extensive
improvements that were then being made, the assessment of the improvements in 1903 was
almost double that in 1901 and 1902.
We believe it, therefore, a necessary conclusion that the city erred in adding the assessment of
the improvements as made in 1903 to the land assessment of that year in order to determine
whether or not the plaintiff was entitled to the refund in question. As we have already intimated,
the improvements as assessed in 1901 and 1902 no longer existed when the assessment of 1903
was made, and that, in reality and as a matter of fact, no assessment was made in 1903 of the
improvements assessed in 1901 and 1902. As a necessary result, we have no basis from which
we may compare the assessment of the improvements of 1903 with those of 1901 and 1902. If
the plaintiff can gain nothing from this fact, she certainly should lose nothing from it. The land
assessed in 1901 and 1902 was the same land assessed in 1903 and upon that land alone she was
entitled to the refund of P2,121.80, which was made to her when she paid her taxes in 1903. If
the improvements had been assessed in 1903 the same as they in 1901 and 1902, then the total of
the assessments for 1901 and 1902 would have been more than 50 per cent higher than the total
as assessed in 1903. It was only the addition in 1903 of about P20,000 to the assessed valuation
of the improvements made in 1901 and 1902 that, even under the theory of the city, removed the
plaintiff's claim from the provisions of the statute, the total assessments in 1901 and 1902, under
that theory, not being 50 per cent than the total assessment in 1903. It is clear, therefore, that
plaintiff was entitled to the refund with respect to her 1903 taxes, that the refund was duly
authorized by a resolution of the municipal board, and that she received it as a credit upon her
taxes pursuant to that resolution.
It is our opinion, therefore, that the taxes for 1903 were duly paid and the lien thereof fully
discharged, and that the demand made by the defendant upon plaintiff that she again pay the
taxes for that year was without authority of law and unenforceable. Such demand placed upon
the plaintiff no duty except that of selecting a legal method of contesting the validity of
defendant's claim. She selected the method of paying the sum demanded, under protest, and

beginning an action to recover it, following the procedure prescribed in ordinary tax cases. In
doing that she was entirely justified, it appearing that the city claimed that the taxes for 1903 had
not been paid, that they were a lien upon the plaintiff's property, and that, if they were not paid,
proceedings would be taken to seize and sell said lands by virtue thereof; and, particularly in
view of that provision of the tax law which requires that, before the validity of a tax can be
attacked or a decision obtained therein in the courts, the tax must be paid under protest and an
action begun for its recovery. It is unreasonable that a man who denies the legality of a tax
should have a clear and certain remedy. the rule being established that, apart from special
circumstances, he cannot interfere by injunction with the state's collection of its revenues, an
action at law to recover back what he has paid is the alternative left. Of course, we are speaking
of those cases where the state is put to an action where the citizen refuses to pay. In these latter
he can interpose his objections by way of defense, but when, as is common, the state has a more
summary remedy, such as distress, and the party indicates by protest that he is yielding to what
he cannot prevent, courts have been a little too slow to recognize the implied duress under which
the payment is made. But even if the state is driven to an action, if at the same time the citizen is
put at a serious disadvantage in the assertion of his legal rights by defense in the suit, justice may
require that he should be at liberty to avoid those disadvantages by paying promptly and bringing
suit on his side. He is entitled to assert his supposed rights on reasonably equal terms. (Atchison
etc. Ry. Co. vs. O'Connor, 223 U. S., 280.)
The judgment appealed from is reversed, and the cause is remanded to the Court of First Instance
whence it came with instructions to enter a judgment in favor of the plaintiff and against the
defendant for the sum of P2,121.80 with interest thereon from the 26th of January, 1911. No
costs in this instance.
Arellano, C. J., Carson, Trent and Araullo, JJ., concur.

Judicial Notice, when mandatory


City of Manila vs. Gerardo Garcia et.al
FACTS:
1. Plaintiff is the owner of certain parcels of land. Without the knowledge and consent of
plaintiff,
defendants occupied the property and built their houses.
2. Having discovered, plaintiff through its mayor gave each defendant written permits, each
labeled
as lease contract to occupy specific areas. For their occupancy, defendants were charged
nominal rentals.
3. After sometime, plaintiff, through its treasurer, demanded payment of their rentals and vacate
the
premises for the Epifanio de los Santos Elementary Schools expansion.
4. Despite the demand, defendants refused to vacate the said property. Hence, this case was filed
for recovery of possession.
5. The trial court ruled in favor of plaintiff taking judicial notice of Ordinance 4566
appropriating
P100k for the construction of additional building of Epifanio De Los Santos Elementary School.
6. Defendants appealed.
ISSUE: WoN the trial court properly found that the city needs the premises for school purposes
HELD: YES
The trial court ruled out the admissibility of the documentary evidence presented by plaintiff
Certification of the Chairman, Committee on Appropriations of the Municipal Board which
recites the
amount of P100k had been set aside in Ordinance 4566 for the construction of additional
building of the
said school.
But then the decision under review, the trial court revised his views. He there declared that there
was a need for defendants to vacate the premises for school expansion; he cited the very
document.
Because of the courts contradictory stance, defendants brought this case on appeal. However, the
elimination of the certification as evidence would not profit defendants. For, in reversing his
stand,
the trial judge could well have taken because he was duty bound to take judicial notice
5
of
Ordinance 4566. The reason being that the city charter of Manila requires all courts sitting
therein
to take judicial notice of all ordinances passed by the municipal board of Manila.
6
And, Ordinance
4566 itself confirms the certification aforesaid that an appropriation of P100,000.00 was set aside
for the "construction of additional building" of the Epifanio de los Santos Elementary School.
Further defendants entry to the said property is illeg

SECOND DIVISION
[G.R. No. 111088. June 13, 1997]
C & M TIMBER CORPORATION (CMTC), petitioner, vs. HON. ANGEL C. ALCALA,
Secretary of the Department of Environment & Natural Resources, HON. ANTONIO T.
CARPIO, Chief Presidential Legal Counsel, and HON. RENATO C. CORONA, Assistant
Executive Secretary for Legal Affairs, respondents.
DECISION
MENDOZA, J.:
This is a petition for certiorari by which C & M Timber Corporation seeks the nullification of
the order dated February 26, 1993 and the resolution dated June 7, 1993 of the Office of the
President, declaring as of no force and effect Timber License Agreement (TLA) No. 106 issued
to petitioner on June 30, 1972. TLA No. 106, with the expiry date June 30, 1997, covers 67,680
hectares of forest land in the municipalities of Dipaculao and Dinalongan in the Province of
Aurora and the Municipality of Maddela in Quirino province. [1]
i

It appears that in a letter dated July 20, 1984 [2] to President Marcos, Filipinas Loggers
Development Corporation (FLDC), through its president and general manager, requested a
timber concession over the same area covered by petitioners TLA No. 106, alleging that the same
had been cancelled pursuant to a presidential directive banning all forms of logging in the area.
The request was granted in a note dated August 14, 1984 by President Marcos who wrote, as was
his wont, on the margin of the letter of FLDC: Approved. [3]
ii

iii

Accordingly, on September 21, 1984, the Ministry of Natural Resources, as it was then called,
issued TLA No. 360, with the expiry date September 30, 1994, to FLDC, covering the area
subject of TLA No. 106. In 1985, FLDC began logging operations.
On June 26, 1986, then Minister of Natural Resources Ernesto M. Maceda suspended TLA No.
360 for FLDCs gross violation of the terms and conditions thereof, especially the reforestation
and selective logging activities and in consonance with the national policy on forest
conservation. [4] On July 26, 1986, Minister Maceda issued another order cancelling the license
of FLDC on the ground that in spite of the suspension order dated June 26, 1986, said
concessionaire has continued logging operations in violation of forestry rules and regulations. [5]
iv

Learning of the cancellation of FLDCs TLA, petitioner, through its officer-in-charge, wrote
Minister Maceda a letter dated October 10, 1986, requesting revalidation of its TLA No. 106. [6]
As FLDC sought a reconsideration of the order cancelling its TLA, petitioner wrote another letter
dated February 13, 1987, [7] alleging that because of the log ban imposed by the previous
administration it had to stop its logging operations, but that when the ban was lifted on
September 21, 1984, its concession area was awarded to FLDC as a result of [FLDCs] covetous
maneuvers and unlawful machinations. (Petitioner was later to say that those behind FLDC,
among them being the former Presidents sister, Mrs. Fortuna Barba, were very influential
vi

vii

because of their very strong connections with the previous Marcos regime.)
that it be allowed to resume logging operations.

viii

[8]

Petitioner prayed

In his order dated May 2, 1988, [9] Secretary Fulgencio Factoran, Jr., of the DENR, declared
petitioners TLA No. 106 as of no more force and effect and consequently denied the petition for
its restoration, even as he denied FLDCs motion for reconsideration of the cancellation of TLA
No. 360. Secretary Factoran, Jr. ruled that petitioners petition was barred by reason of laches,
because petitioner did not file its opposition to the issuance of a TLA to FLDC until February 13,
1987, after FLDC had been logging under its license for almost two years. On the other hand,
FLDCs motion for reconsideration was denied, since the findings on which the cancellation order
had been based, notably gross violation of the terms and conditions of its license, such as
reforestation and selective logging activities appear to be firmly grounded.
ix

Both petitioner CMTC and FLDC appealed to the Office of the President. Petitioner denied that
it was guilty of laches. It alleged that it had sent a letter to the then Minister of Natural Resources
Rodolfo del Rosario dated September 24, 1984 protesting the grant of a TLA to FLDC over the
area covered by its (petitioners) TLA and, for this reason, requesting nullification of FLDCs
TLA.
In a decision dated March 21, 1991, [10] the Office of the President, through then Executive
Secretary Oscar Orbos, affirmed the DENRs order of May 2, 1988. Like the DENR it found
petitioner guilty of laches, the alleged filing by petitioner of a protest on September 24, 1984 not
having been duly proven. The decision of the Office of the President stated: [11]
x

xi

As disclosed by the records, this Office, in a letter of June 1, 1989, had requested the DENR
to issue a certification as to the authenticity/veracity of CMTCs aforesaid Annex A to enable
it to resolve this case judiciously and expeditiously. Said letter-request pertinently reads:
x x x C & M Timber Corporation has attached to its Supplemental Petition For Review, dated
June 1, 1988, a xerox copy of (Annex A) of its letter to the Minister of Natural Resources
Rodolfo del Rosario, dated September 24, 1984, prepared by its counsel, Atty. Norberto J.
Quisumbing, protesting against the award of the contested area to Filipinas Loggers
Development Corporation and requesting that it be annulled and voided.
Considering that the aforementioned Annex A constitutes a vital defense to C & M Timber
Corporation and could be a pivotal factor in the resolution by this Office of the instant appeal,
may we request your good office for a certification as to the authenticity/veracity of said
document (Annex A) to enable us to resolve the case judiciously and expeditiously.
In reply thereto, the DENR, thru Assistant Secretary for Legal Affairs Romulo D. San Juan, in a
letter of July 7, 1989, informed this Office, thus:
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Despite diligent efforts exerted to locate the alleged aforementioned Annex A, no such document
could be found or is on file in this Office.

This Office, therefore, regrets that it can not issue the desired certification as to the
authenticity/veracity of the document.
On September 10, 1990, this Office requested an updated comment of the DENR on (a) the
duplicate original copy of Annex A; (b) a xerox copy of Page 164, entry No. 2233, of the MNRs
logbook tending to show that the original copy of Annex A was received by the MNR; and (c) a
xerox copy of Page 201 of the logbook of the BFD indicating that the original copy of Annex A
was received by BFD from the MNR.
On October 26, 1990, DENR Assistant Secretary San Juan endorsed to this Office the updated
comment of Director of Forest Management Bureau (FMB) in a 2nd endorsement of October 25,
1990, which pertinently reads as follows:
Please be informed that this Office is not the addressee and repository of the letter dated
September 24, 1984 of Atty. Norberto Quisumbing. This Office was just directed by then
Minister Rodolfo del Rosario to act on the purported letter of Atty. Quisumbing and as directed,
we prepared a memorandum to the President which was duly complied with as shown by the
entries in the logbook. Annex A, which is the main document of the letter-appeal of C & M
Timber Corporation is presumed appended to the records when it was acted upon by the BFD
(now FMB) and forwarded to the Secretary (then Minister). Therefore this Office is not in a
position to certify as to the authenticity of Annex A.
Clearly therefore, CMTCs reliance on its Annex A is misplaced, the authenticity thereof not
having been duly proven or established. Significantly, we note that in all the pleadings filed by
CMTC in the office a quo, and during the hearing conducted, nothing is mentioned therein about
its letter of September 24, 1984 (Annex A). Jurisprudence teaches that issues neither averred in
the pleadings nor raised during the trial below cannot be raised for the first time on appeal (City
of Manila vs. Ebay, 1 SCRA 1086, 1089); that issues of fact not adequately brought to the
attention of the trial court need not be considered by a reviewing court, as they cannot be raised
for the first time on appeal (Santos v. Intermediate Appellate Court, 145 SCRA 592, 595); and
that parties, may not, on appeal, adopt a position inconsistent with what they sustained below
(People v. Archilla, 1 SCRA 698, 700-701)
The Office of the President also declined to set aside the DENRs order of July 31, 1986,
cancelling FLDCs TLA No. 360, after finding the same to be fully substantiated.
Petitioner and FLDC moved for reconsideration. In its order dated January 25, 1993, [12] the
Office of the President, through Chief Presidential Legal Counsel Antonio T. Carpio, denied
petitioners motion for reconsideration. It held that even assuming that CMTC did file regularly
its letter-protest of September 24, 1984 with MNR on September 25, 1984, CMTC failed to
protect its rights for more than two (2) years until it opposed reinstatement of FLDCs TLA on
February 13, 1987. Within that two (2) year period, FLDC logged the area without any
opposition from CMTC. In the same order, the Office of the President, however, directed the
reinstatement of FLDCs TLA No. 360, in view of the favorable report of the Bureau of Forest
Development dated March 23, 1987. Later, the Presidents office reconsidered its action after the
Secretary of Environment and Natural Resources Angel C. Alcala, on February 15, 1993,
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expressed concern that reinstatement of FLDCs TLA No. 360 might negate efforts to enhance the
conservation and protection of our forest resources. In a new order dated February 26, 1993, [13]
the Office of the President reinstated its March 21, 1991 decision.
xiii

Petitioner again moved for a reconsideration of the decision dated March 21, 1991 and for its
license to be revived/restored. Petitioners motion was, however, denied by the Office of the
President on June 7, 1993 [14] in a resolution signed by Assistant Executive Secretary for Legal
Affairs Renato C. Corona. The Presidents office ruled:
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The above Order of February 26, 1993 was predicated, as stated therein, on a new policy
consideration on forest conservation and protection, unmistakably implied from the
Presidents handwritten instruction. Accordingly, this Order shall be taken not only as an
affirmation of the March 21, 1991 decision, but also as a FINAL disposition of the case and
ALL matters incident thereto, like CMTCs motion for reconsideration, dated April 16, 1991.
Hence, this petition. Petitioner contends that laches cannot be imputed to it because it did not
incur delay in asserting its rights and even if there was delay, the delay did not work to the
prejudice of other parties, particularly FLDC, because the cancellation of the FLDCs TLA was
attributable only to its own actions. Petitioner also denies that its license had been suspended by
reason of mediocre performance in reforestation by order of then Minister of Natural Resources
Teodoro O. Pea. It says that it did not receive any order to this effect. Finally, petitioner claims
that the denial of its petition, because of a new policy consideration on forest conservation and
protection, unmistakably implied from the Presidents handwritten instruction, as stated in the
resolution of June 7, 1993 of the Office of the President, would deny it the due process of law.
Petitioner points out that there is no total log ban in the country; that Congress has yet to make a
pronouncement on the issue; that any notice to this effect must be stated in good form, not
implied; and that in any case, any new policy consideration should be prospective in application
and cannot affect petitioners vested rights in its TLA No. 106.
We find the petition to be without merit.
First. As already stated, the DENR order of May 2, 1988, declaring petitioners TLA No. 106 as
no longer of any force and effect, was based on its finding that although TLA No. 106s date of
expiry was June 30, 1997 it had been suspended on June 3, 1983 because of CMTCs mediocre
performance in reforestation and petitioners laches in failing to protest the subsequent award of
the same area to FLDC. There is considerable dispute whether there was really an order dated
June 3, 1983 suspending petitioners TLA because of mediocre performance in reforestation, just
as there is a dispute whether there indeed was a letter written on September 24, 1984 on behalf of
petitioner protesting the award of the concession covered by its TLA No. 106 to FLDC, so as to
show that petitioner did not sleep on its rights.
The alleged order of June 3, 1983 cannot be produced. The Office of the Solicitor General was
given until May 14, 1997 to secure a copy of the order but on May 7, 1997 the OSG manifested
that the order in question could not be found in the records of this case in which the order might
be. [15] Earlier, petitioner requested a copy of the order but the DENR, through Regional
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Executive Director Antonio G. Principe, said that based from our records there is no file copy of
said alleged order. [16]
xvi

On the other hand, the alleged letter of September 24, 1984 written by Atty. Norberto J.
Quisumbing, protesting the award of the concession in question to FLDC cannot be found in the
records of the DENR either. The Assistant Secretary for Legal Affairs of the DENR certified that
Despite diligent efforts exerted to locate the alleged [letter], no such document could be found or
is on file in this Office. [17] In a later certification, however, Ofelia Castro Biron of the DENR,
claimed that she was a receiving clerk at the Records and Documents Section of the Ministry of
Natural Resources and that on September 25, 1984 she received the letter of Atty. Quisumbing
and placed on all copies thereof the stamp of the MNR. She stated that the copy in the possession
of petitioner was a faithful copy of the letter in question. [18]
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The difficulty of ascertaining the existence of the two documents is indeed a reflection on the
sorry state of record keeping in an important office of the executive department. Yet these two
documents are vital to the presentation of the evidence of both parties in this case. Fortunately,
there are extant certain records from which it is possible to determine whether these documents
even existed.
With respect to the alleged order of June 3, 1983 suspending petitioners TLA No. 106 for
mediocre performance in reforestation, the Court will presume that there is such an order in
accordance with the presumption of regularity in the performance of official functions inasmuch
as such order is cited both in the order dated May 2, 1988 of the DENR, declaring as of no force
and effect TLA No. 106, and in the decision dated March 21, 1991 of the Office of the President
affirming the order of the DENR. It is improbable that so responsible officials as the Secretary of
the DENR and the Executive Secretary would cite an order that did not exist.
On the other hand, with respect to the letter dated September 24, 1984, there are circumstances
indicating that it existed. In addition to the aforesaid certification of Ofelia Castro Biron that she
was the person who received the letter for the DENR, the logbook of the Ministry of Natural
Resources contains entries indicating that the letter was received by the Bureau of Forest
Development from the MNR. [19] DENR Assistant Secretary Romulo San Juan likewise
informed the Office of the President that the Bureau of Forest Management prepared a
memorandum on the aforesaid letter of September 24, 1984, [20] thereby implying that there was
such a letter.
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xx

On the premise that there was an order dated June 3, 1983, we find that after suspending
petitioners TLA for mediocre performance in reforestation under this order, the DENR cancelled
the TLA, this time because of a Presidential directive imposing a log ban. The records of G.R.
No. 76538, entitled Felipe Ysmael, Jr. & Co. v. Deputy Executive Secretary, the decision in
which is reported in 190 SCRA 673 (1990), contain a copy of the memorandum of then Director
Edmundo V. Cortes of the Bureau of Forest Development to the Regional Director of Region 2,
in Tuguegarao, Cagayan, informing the latter that pursuant to the instruction of the President and
the memorandum dated August 18, 1983 of then Minister Teodoro Q. Pea, the log ban previously
declared included the concessions of the companies enumerated in Cortes memorandum, in

consequence of which the concessions in question were deemed cancelled. The memorandum of
Director Cortes stated:
MEMORANDUM ORDER
TO
: The Regional Director
Region 2, Tuguegarao, Cagayan
FROM

: The Director

DATE

: 24 August 1983

SUBJECT : Stopping of all logging operations


in Nueva Vizcaya and Quirino
REMARKS :
Following Presidential Instructions and Memorandum Order of Minister Teodoro Q. Pea dated
18 August 1983, and in connection with my previous radio message, please be informed that the
coverage of the logging ban in Quirino and Nueva Vizcaya provinces include the following
concessions which are deemed cancelled as of the date of the previous notice:
-

Felipe Ysmael Co., Inc.


Industries Dev. Corp.
Luzon Loggers, Inc.
C & M Timber Corporation
Buzon Industrial Dev. Corporation
Dominion Forest Resources Corp.
FCA Timber Development Corp.
Kasibu Logging Corp.
RCC Timber Company
Benjamin Cuaresma

You are hereby reminded to insure full compliance with this order to stop logging operations by
all licensees above mentioned and submit a report on the pullout of equipment and inventory of
logs within five days upon receipt hereof.
ACTION
DESIRED :

For your immediate implementation.


EDMUNDO V. CORTES

(Emphasis added)
It thus appears that petitioners license had been cancelled way back in 1983, a year before its
concession was awarded to FLDC. It is noteworthy that petitioner admits that at the time of the

award to FLDC in 1984 petitioner was no longer operating its concession because of a log ban
although it claims that the suspension of operations was only temporary. As a result of the log
ban, the TLA of petitioner, along with those of other loggers in the region, were cancelled and
petitioner and others were ordered to stop operations. Petitioner also admits that it received a
telegram sent on August 24, 1983 by Director Cortes of the BFD, directing it to stop all logging
operations to conserve our remaining forests. [21] It is then not true, as Atty. Quisumbing stated
in protesting the award of the concession to FLDC, that the logging ban did not cancel
[petitioners] timber license agreement.
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Now petitioner did not protest the cancellation of its TLA. Consequently, even if consideration is
given to the fact that a year later, on September 24, 1984, its counsel protested the grant of the
concession to another party (FLDC), this failure of petitioner to contest first the suspension of its
license on June 3, 1983 and later its cancellation on August 24, 1983 must be deemed fatal to its
present action.
Second. Except for the letter of its counsel to the Minister of Natural Resources, which it
reiterated in its letter to the President of the Philippines, petitioner took no legal steps to protect
its interest. After receiving no favorable response to its two letters, petitioner could have brought
the necessary action in court for the restoration of its license. It did not. Instead it waited until
FLDCs concession was cancelled in 1986 by asking for the revalidation of its (petitioners) on
TLA No. 106.
Petitioners excuse before the DENR is that it did not pursue its protest because its president,
Ricardo C. Silverio, had been told by President Marcos that the area in question had been
awarded to the Presidents sister, Mrs. Fortuna Barba, and petitioner was afraid to go against the
wishes of the former President. [22] This is a poor excuse for petitioners inaction. In Felipe
Ysmael, Jr. & Co., Inc. v. Deputy Executive Secretary, [23] a similar excuse was given that
Ysmael & Cos license had been cancelled and its concession awarded to entities controlled or
owned by relatives or cronies of then President Marcos. For this reason, after the EDSA
Revolution, Ysmael & Co. sought in 1986 the reinstatement of its timber license agreement and
the revocation of those issued to the alleged presidential cronies. As its request was denied by the
Office of the President, Ysmael & Co. filed a petition for certiorari with this Court. On the basis
of the facts stated, this Court denied the petition: (1) because the August 25, 1983 order of the
Bureau of Forest Development, cancelling petitioners timber license agreement had become final
and executory. Although petitioner sent a letter dated September 19, 1983 to President Marcos
seeking reconsideration of the 1983 order of cancellation of the BFD, the grounds stated there
were different from those later relied upon by petitioner for seeking its reinstatement; (2) because
the fact that petitioner failed to seasonably take judicial recourse to have the earlier
administrative actions [cancelling its license and granting another one covering the same
concession to respondent] reviewed by the court through a petition for certiorari is prejudicial to
its cause. Such special civil action of certiorari should have been filed within a reasonable time.
And since none was filed within such period, petitioners action was barred by laches; and (3)
because executive evaluation of timber licenses and their consequent cancellation in the process
of formulating policies with regard to the utilization of timber lands is a prerogative of the
executive department and in the absence of evidence showing grave abuse of discretion courts
will not interfere with the exercise of that discretion.
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xxiii

This case is governed by the decision in Felipe Ysmael, Jr. & Co., Inc. v. Deputy Executive
Secretary.
Third. It is finally contended that any policy consideration on forest conservation and protection
justifying the decision of the executive department not to reinstate petitioners license must be
formally enunciated and cannot merely be implied from the Presidents instruction to his
subordinates and that, at all events, the new policy cannot be applied to existing licenses such as
petitioners.
The Presidents order reconsidering the resolution of the Presidential Legal Adviser (insofar as it
reinstated the license of FLDC) was prompted by concerns expressed by the then Secretary of
Environment and Natural Resources that said reinstatement [of FLDCs license] may negate our
efforts to enhance conservation and protection of our forest resources. There was really no new
policy but, as noted in Felipe Ysmael, Jr. & Co., Inc., a mere reiteration of a policy of
conservation and protection. The policy is contained in Art. II, 16 of the Constitution which
commands the State to protect and promote the right of the people to a balanced and healthful
ecology in accord with the rhythm and harmony of nature. There is therefore no merit in
petitioners contention that no new policy can be applied to existing licenses.
As to petitioners contention that the cancellation of its license constitutes an impairment of the
obligation of its contract, suffice it for us to quote what we held in Felipe Ysmael, Jr. & Co. Inc.
v. Deputy Executive Secretary: [24]
xxiv

A cursory reading of the assailed orders issued by public respondent Minister Maceda of the
MNR, which were affirmed by the Office of the President, will disclose public policy
considerations which effectively forestall judicial interference in the case at bar.
Public respondents herein, upon whose shoulders rests the task of implementing the policy to
develop and conserve the countrys natural resources, have indicated an ongoing department
evaluation of all timber license agreements entered into, and permits or licenses issued, under the
previous dispensation. . . .
The ongoing administrative reassessment is apparently in response to the renewed and growing
global concern over the despoliation of forest lands and the utter disregard of their crucial role in
sustaining a balanced ecological system. The legitimacy of such concern can hardly be disputed,
most especially in this country. . . .
Thus, while the administration grapples with the complex and multifarious problems caused by
unbridled exploitation of these resources, the judiciary will stand clear. . . . More so where, as in
the present case, the interests of a private logging company are pitted against that of the public at
large on the pressing public policy issue of forest conservation. . . . Timber licenses, permits and
license agreements are the principal instruments by which the State regulates the utilization and
disposition of forest resources to the end that public welfare is promoted. And it can hardly be
gainsaid that they merely evidence a privilege granted by the State to qualified entities, and do
not vest in the latter a permanent or irrevocable right to the particular concession area and the
forest products therein. They may be validly amended, modified, replaced or rescinded by the

Chief Executive when national interests so require. Thus, they are not deemed contracts within
the purview of the due process of law clause [See Sections 3(33) and 20 of Pres. Decree No. 705,
as amended. Also, Tan v. Director of Forestry, G.R. No. L-24548, October 27, 1983, 125 SCRA
302].
WHEREFORE, the petition is DISMISSED.
SO ORDERED.

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