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SHELL PHILIPPINES G.R. No.

179918
EXPLORATION B.V.,
represented by its Managing
Director, Jeremy Cliff,
Petitioner, Present:
CARPIO, J., Chairperson,
- versus - PERALTA,
DEL CASTILLO,*
ABAD, and
MENDOZA, JJ.

EFREN JALOS, ET.ALa


Respondents. Promulgated:
September 8, 2010
x --------------------------------------------------------------------------------------- x

DECISION

ABAD, J.:

This case is about a question of jurisdiction over an action against a petroleum contractor, whose pipeline operation has allegedly
driven the fish away from coastal areas, inflicting loss of earnings among fishermen.

The Facts and the Case

On December 11, 1990 petitioner Shell Philippines Exploration B.V. (Shell) and the Republic of the Philippines entered into
Service Contract 38 for the exploration and extraction of petroleum in northwestern Palawan. Two years later, Shell discovered
natural gas in the Camago-Malampaya area and pursued its development of the well under the Malampaya Natural Gas Project. This
entailed the construction and installation of a pipeline from Shells production platform to its gas processing plant in Batangas. The
pipeline spanned 504 kilometers and crossed the Oriental Mindoro Sea.

On May 19, 2003, respondents Efren Jalos, Joven Campang, Arnaldo Mijares, and 75 other individuals (Jalos, et al) filed a
complaint for damages[1] against Shell before the Regional Trial Court (RTC), Branch 41, Pinamalayan, Oriental Mindoro. Jalos, et
al claimed that they were all subsistence fishermen from the coastal barangay of Bansud, Oriental Mindoro whose livelihood was
adversely affected by the construction and operation of Shells natural gas pipeline.

Jalos, et al claimed that their fish catch became few after the construction of the pipeline. As a result, their average net income per
month fell from a high of P4,848.00 to only P573.00. They said that the pipeline greatly affected biogenically hard-structured
communities such as coral reefs and led [to] stress to the marine life in the Mindoro Sea. They now have to stay longer and farther
out at sea to catch fish, as the pipelines operation has driven the fish population out of coastal waters. [2]

Instead of filing an answer, Shell moved for dismissal of the complaint. It alleged that the trial court had no jurisdiction over the
action, as it is a pollution case under Republic Act (R.A.) 3931, as amended by Presidential Decree (P.D.) 984 or the Pollution
Control Law. Under these statutes, the Pollution Adjudication Board (PAB) has primary jurisdiction over pollution cases and
actions for related damages.[3]

Shell also claimed that it could not be sued pursuant to the doctrine of state immunity without the States consent. Shell said that
under Service Contract 38, it served merely as an agent of the Philippine government in the development of the Malampaya gas
reserves.

Moreover, said Shell, the complaint failed to state a cause of action since it did not specify any actionable wrong or particular act
or omission on Shells part that could have caused the alleged injury to Jalos, et al. The complaint likewise failed to comply with
requirements of a valid class suit, verification and certification against forum shopping, and the requisites for a suit brought by
pauper litigants.[4]

On March 24, 2004 the RTC dismissed the complaint. It ruled that the action was actually pollution-related, although denominated
as one for damages. The complaint should thus be brought first before the PAB, the government agency vested with jurisdiction
over pollution-related cases.[5]
Jalos, et al assailed the RTCs order through a petition for certiorari[6] before the Court of Appeals (CA). In due course, the latter
court reversed such order and upheld the jurisdiction of the RTC over the action. It said that Shell was not being sued for committing
pollution, but for constructing and operating a natural gas pipeline that caused fish decline and considerable reduction in the
fishermens income. The claim for damages was thus based on a quasi-delict over which the regular courts have jurisdiction.
The CA also rejected Shells assertion that the suit was actually against the State. It observed that the government was not even
impleaded as party defendant. It gave short shrift to Shells insistence that, under the service contract, the government was solidarily
liable with Shell for damages caused to third persons. Besides, the State should be deemed to have given its consent to be sued
when it entered into the contract with Shell.

The CA also held that the complaint sufficiently alleged an actionable wrong. Jalos, et al invoked their right to fish the sea and
earn a living, which Shell had the correlative obligation to respect. Failure to observe such obligation resulted in a violation of the
fishermens rights and thus gave rise to a cause of action for damages. [7]

Finally, the CA held that Jalos, et al substantially complied with the technical requirements for filing the action. But since they
failed to prove the requisites of a class suit, only those who have verified the complaint should be deemed party plaintiffs. [8]

Shell moved for reconsideration of the CAs decision but the same was denied.[9] Hence, it filed this petition for review under Rule
45.

The Issues Presented

The case presents the following issues:

1. Whether or not the complaint is a pollution case that falls within the primary jurisdiction of the PAB;

2. Whether or not the complaint sufficiently alleges a cause of action against Shell; and

3. Whether or not the suit is actually against the State and is barred under the doctrine of state immunity.

The Courts Rulings

First. Although the complaint of Jalos, et al does not use the word pollution in describing the cause of the alleged fish
decline in the Mindoro Sea, it is unmistakable based on their allegations that Shells pipeline produced some kind of poison or
emission that drove the fish away from the coastal areas. While the complaint did not specifically attribute to Shell any specific act
of pollution, it alleged that the pipeline greatly affected biogenically hard-structured communities such as coral reefs and led [to]
stress to the marine life in the Mindoro Sea.[10] This constitutes pollution as defined by law.

Section 2(a) of P.D. 984 defines pollution as any alteration of the physical, chemical and biological properties of any water x
x x as will or is likely to create or render such water x x x harmful, detrimental or injurious to public health, safety or welfare or
which will adversely affect their utilization for domestic, commercial, industrial, agricultural, recreational or other legitimate
purposes.

It is clear from this definition that the stress to marine life claimed by Jalos, et al is caused by some kind of pollution
emanating from Shells natural gas pipeline. The pipeline, they said, greatly affected or altered the natural habitat of fish and affected
the coastal waters natural function as fishing grounds. Inevitably, in resolving Jalos, et als claim for damages, the proper tribunal
must determine whether or not the operation of the pipeline adversely altered the coastal waters properties and negatively affected
its life sustaining function. The power and expertise needed to determine such issue lies with the PAB.

Executive Order 192 (1987) transferred to the PAB the powers and functions of the National Pollution and Control
Commission provided in R.A. 3931, as amended by P.D. 984.[11] These empowered the PAB to [d]etermine the location, magnitude,
extent, severity, causes and effects of water pollution.[12] Among its functions is to [s]erve as arbitrator for the determination of
reparation, or restitution of the damages and losses resulting from pollution. In this regard, the PAB has the power to conduct
hearings,[13] impose penalties for violation of P.D. 984,[14] and issue writs of execution to enforce its orders and decisions.[15] The
PABs final decisions may be reviewed by the CA under Rule 43 of the Rules of Court. [16]

Jalos, et al had, therefore, an administrative recourse before filing their complaint with the regular courts. [17] The laws
creating the PAB and vesting it with powers are wise. The definition of the term pollution itself connotes the need for specialized
knowledge and skills, technical and scientific, in determining the presence, the cause, and the effects of pollution. These knowledge
and skills are not within the competence of ordinary courts. [18] Consequently, resort must first be made to the PAB, which is the
agency possessed of expertise in determining pollution-related matters.
To this extent, the failure of Jalos, et al to allege in their complaint that they had first taken resort to PAB before going
to court means that they failed to state a cause of action that the RTC could act on. This warranted the dismissal of their action.[19]

Second. Still, Shell points out that the complaint also states no cause of action because it failed to specify any actionable
wrong or particular act or omission on Shells part. The Court cannot agree.

As mentioned above, the complaint said that the natural gas pipelines construction and operation greatly affected the
marine environment, drove away the fish, and resulted in reduced income for Jalos, et al. True, the complaint did not contain some
scientific explanation regarding how the construction and operation of the pipeline disturbed the waters and drove away the fish
from their usual habitat as the fishermen claimed. But lack of particulars is not a ground for dismissing the complaint.

A cause of action is the wrongful act or omission committed by the defendant in violation of the primary rights of the plaintiff.[20] Its
elements consist of: (1) a right existing in favor of the plaintiff, (2) a duty on the part of the defendant to respect the plaintiffs right,
and (3) an act or omission of the defendant in violation of such right.[21] To sustain a motion to dismiss for lack of cause of action,
however, the complaint must show that the claim for relief does not exist and not only that the claim was defectively stated or is
ambiguous, indefinite or uncertain.[22]
Here, all the elements of a cause of action are present. First, Jalos, et al undoubtedly had the right to the preferential use of marine
and fishing resources which is guaranteed by no less than the Constitution.[23] Second, Shell had the correlative duty to refrain from
acts or omissions that could impair Jalos, et als use and enjoyment of the bounties of the seas. Lastly, Shells construction and
operation of the pipeline, which is an act of physical intrusion into the marine environment, is said to have disrupted and impaired
the natural habitat of fish and resulted in considerable reduction of fish catch and income for Jalos, et al.
Thus, the construction and operation of the pipeline may, in itself, be a wrongful act that could be the basis of Jalos, et als cause of
action. The rules do not require that the complaint establish in detail the causal link between the construction and operation of the
pipeline, on the one hand, and the fish decline and loss of income, on the other hand, it being sufficient that the complaint states
the ultimate facts on which it bases its claim for relief. The test for determining the sufficiency of a cause of action rests on whether
the complaint alleges facts which, if true, would justify the relief demanded. [24] In this case, a valid judgment for damages can be
made in favor of Jalos, et al, if the construction and operation of the pipeline indeed caused fish decline and eventually led to the
fishermens loss of income, as alleged in the complaint.

Third. Shell claims that it cannot be sued without the States consent under the doctrine of state immunity from suit. But,
to begin with, Shell is not an agent of the Republic of the Philippines. It is but a service contractor for the exploration and
development of one of the countrys natural gas reserves. While the Republic appointed Shell as the exclusive party to conduct
petroleum operations in the Camago-Malampayo area under the States full control and supervision,[25] it does not follow that Shell
has become the States agent within the meaning of the law.
An agent is a person who binds himself to render some service or to do something in representation or on behalf of another, with
the consent or authority of the latter.[26] The essence of an agency is the agents ability to represent his principal and bring about
business relations between the latter and third persons.[27] An agents ultimate undertaking is to execute juridical acts that would
create, modify or extinguish relations between his principal and third persons.[28] It is this power to affect the principals contractual
relations with third persons that differentiates the agent from a service contractor.

Shells main undertaking under Service Contract 38 is to [p]erform all petroleum operations and provide all necessary
technology and finance as well as other connected services[29] to the Philippine government. As defined under the contract,
petroleum operation means the searching for and obtaining Petroleum within the Philippines, including the transportation, storage,
handling and sale of petroleum whether for export or domestic consumption.[30] Shells primary obligation under the contract is not
to represent the Philippine government for the purpose of transacting business with third persons. Rather, its contractual
commitment is to develop and manage petroleum operations on behalf of the State.

Consequently, Shell is not an agent of the Philippine government, but a provider of services, technology and
financing[31] for the Malampaya Natural Gas Project. It is not immune from suit and may be sued for claims even without the States
consent. Notably, the Philippine government itself recognized that Shell could be sued in relation to the project. This is evident in
the stipulations agreed upon by the parties under Service Contract 38.

Article II, paragraph 8, Annex B of Service Contract 38[32] states that legal expenses, including judgments obtained
against the Parties or any of them on account of the Petroleum Operations, can be recovered by Shell as part of operating expenses
to be deducted from gross proceeds. Article II, paragraph 9B of the same document allows a similar recovery for [a]ll actual
expenditures incurred and paid by CONTRACTOR [Shell] in settlement of any and all losses, claims, damages, judgments, and
any other expenses not covered by insurance, including legal services. This signifies that the State itself acknowledged the suability
of Shell. Since payment of claims and damages pursuant to a judgment against Shell can be deducted from gross proceeds, the
State will not be required to perform any additional affirmative act to satisfy such a judgment.

In sum, while the complaint in this case sufficiently alleges a cause of action, the same must be filed with the PAB, which is the
government agency tasked to adjudicate pollution-related cases. Shell is not an agent of the State and may thus be sued before that
body for any damages caused by its operations. The parties may appeal the PABs decision to the CA. But pending prior
determination by the PAB, courts cannot take cognizance of the complaint.

WHEREFORE, the Court GRANTS the petition and REVERSES the decision of the Court of Appeals in CA-G.R. CV 82404
dated November 20, 2006. Respondent Efren Jalos, et als complaint for damages against Shell Philippines Exploration B.V. in
Civil Case P-1818-03 of the Regional Trial Court, Branch 41, Pinamalayan, Oriental Mindoro is ordered DISMISSED without
prejudice to its refiling with the Pollution Adjudication Board or PAB.

SO ORDERED.

ROBERTO A. ABAD
Associate Justice

G.R. No. 104988 June 18, 1996


MUSTANG LUMBER, INC., petitioner,
vs.
HON. COURT OF APPEALS, HON. FULGENCIO S. FACTORAN, JR., Secretary, Department of Environment
and Natural Resources (DENR), and ATTY. VINCENT A. ROBLES, Chief, Special Actions and Investigations
Division, DENR, respondents.

G.R. No. 106424 June 18, 1996

PEOPLE OF THE PHILIPPINES, petitioner,


vs.
HON. TERESITA DIZON-CAPULONG, in her capacity as the Presiding Judge, Regional Trial Court, National
Capital Judicial Region, Branch 172, Valenzuela, Metro Manila, and RI CHUY PO, respondents.

G.R. No. 123784 June 18, 1996

MUSTANG LUMBER, INC., petitioner,


vs.
HON. COURT OF APPEALS, ATTY. VINCENT A. ROBLES, Chief, Special Actions and Investigation Division,
Department of Environment and Natural Resources (DENR), ATTY. NESTOR V. GAPUSAN, TIRSO P. PARIAN,
JR., and FELIPE H. CALLORINA, JR., respondents.

DAVIDE, JR., J.:p

The first and third case, G.R. No. 104988 and G.R. No. 123784, were originally assigned to the Second and Third
Divisions of the Court, respectively. They were subsequently consolidated with the second, a case of the Court en
banc.

Petitioner, a domestic corporation with principal office at Nos. 1350-1352 Juan Luna Street, Tondo, Manila, and with
a Lumberyard at Fortune Street, Fortune Village, Paseo de Blas, Valenzuela, Metro Manila, was duly registered as a
lumber dealer with the Bureau of Forest Development (BFD) under Certificate of Registration No. NRD-4-092590-
0469. Its permit as such was to expire on 25 September 1990.

Respondent Secretary Fulgencio S. Factoran, Jr., and respondent Atty. Vincent A. Robles were, during all the time
material to these cases, the Secretary of the Department of Environment and Natural Resources (DENR) and the
Chief of the Special Actions and Investigation Division (SAID) of the DENR, respectively.

The material operative facts are as follows:

On 1 April 1990, acting on an information that a huge stockpile of narra flitches, shorts, and slabs were seen inside
the lumberyard of the petitioner in Valenzuela, Metro Manila, the SAID organized a team of foresters and policemen
and sent it to conduct surveillance at the said lumberyard. In the course thereof, the team members saw coming out
from the lumberyard the petitioner's truck, with Plate No. CCK-322, loaded with lauan and almaciga lumber of
assorted sizes and dimensions. Since the driver could not produce the required invoices and transport documents,
the team seized the truck together with its cargo and impounded them at the DENR compound at Visayas Avenue,
Quezon City.1 The team was not able to gain entry into the premises because of the refusal of the owner.2

On 3 April 1990, the team was able to secure a search warrant from Executive Judge Adriano R. Osorio of the
Regional Trial Court (RTC) of Valenzuela, Metro Manila. By virtue thereof, the team seized on that date from the
petitioner's lumberyard four truckloads of narra shorts, trimmings, and slabs; a negligible number of narra lumber; and
approximately 200,000 board feet of lumber and shorts of various species including almaciga and supa. 3

On 4 April 1990, the team returned to the premises of the petitioner's lumberyard in Valenzuela and placed under
administrative seizure the remaining stockpile of almaciga, supa, and lauan lumber with a total volume of 311,000
board feet because the petitioner failed to produce upon demand the corresponding certificate of lumber origin,
auxiliary invoices, tally sheets, and delivery receipts from the source of the invoices covering the lumber to prove the
legitimacy of their source and origin.4
Parenthetically, it may be stated that under an administrative seizure the owner retains the physical possession of the
seized articles. Only an inventory of the articles is taken and signed by the owner or his representative. The owner is
prohibited from disposing them until further orders.5

On 10 April 1990, counsel for the petitioner sent a letter to Robles requesting an extension of fifteen days from 14
April 1990 to produce the required documents covering the seized articles because some of them, particularly the
certificate of lumber origin, were allegedly in the Province of Quirino Robles denied the motion on the ground that the
documents being required from the petitioner must accompany the lumber or forest products placed under seizure. 6

On 11 April 1990, Robles submitted his memorandum-report recommending to Secretary Factoran the following:

1. Suspension and subsequent cancellation of the lumber Dealer's Permit of Mustang Lumber, Inc.
for operating an unregistered lumberyard and resaw mill and possession of Almaciga Lumber (a
banned specie) without the required documents;

2. Confiscation of the lumber seized at the Mustang Lumberyard including the truck with Plate No.
CCK-322 and the lumber loaded herein [sic] now at the DENR compound in the event its owner
fails to submit documents showing legitimacy of the source of said lumber within ten days from date
of seizure;

3. Filing of criminal charges against Mr. Ri Chuy Po, owner of Mustang Lumber Inc. and Mr. Ruiz,
or if the circumstances warrant for illegal possession of narra and almaciga lumber and shorts if
and when recommendation no. 2 pushes through;

4. Confiscation of Trucks with Plate No. CCS-639 and CDV. 458 as well as the lumber loaded
therein for transport lumber using "recycled" documents. 7

On 23 April 1990, Secretary Factoran issued an order suspending immediately the petitioner's lumber-dealer's permit
No. NRD-4-092590-0469 and directing the petitioner to explain in writing within fifteen days why its lumber-dealer's
permit should not be cancelled.

On the same date, counsel for the petitioner sent another letter to Robles informing the latter that the petitioner had
already secured the required documents and was ready to submit them. None, however, was submitted.8

On 3 May 1990, Secretary Factoran issued another order wherein, after reciting the events which took place on 1
April and 3 April 1990, he ordered "CONFISCATED in favor of the government to be disposed of in accordance with
law" the approximately 311,000 board feet of lauan, supa, and almaciga lumber, shorts, and sticks found inside the
petitioner's lumberyard.9

On 11 July 1990, the petitioner filed with the RTC of Manila a petition for certiorari and prohibition with a prayer for a
restraining order or preliminary injunction against Secretary Fulgencio S. Factoran, Jr., and Atty. Vincent A. Robles.
The case (hereinafter, the FIRST CIVIL CASE) was docketed as Civil Case No. 90-53648 and assigned to Branch 35
of the said court. The petitioner questioned therein (a) the seizure on 1 April 1990, without any search and seizure
order issued by a judge, of its truck with Plate No. CCK-322 and its cargo of assorted lumber consisting of apitong,
tanguile, and lauan of different sizes and dimensions with a total value of P38,000.00; and (b) the orders of Secretary
Factoran of 23 April 1990 for lack of prior notice and hearing and of 3 May 1990 for violation of Section 2, Article III of
the Constitution.

On 17 September 1990, in response to reports that violations of P.D. No. 705 (The Revised Forestry Code of the
Philippines), as amended, were committed and acting upon instruction of Robles and under Special Order No. 897,
series of 1990, a team of DENR agents went to the business premises of the petitioner located at No. 1352 Juan
Luna Street, Tondo, Manila. The team caught the petitioner operating as a lumber dealer although its lumber-dealer's
permit had already been suspended or 23 April 1990. Since the gate of the petitioner's lumberyard was open, the
team went inside and saw an owner-type jeep with a trailer loaded with lumber. Upon investigation, the team was
informed that the lumber loaded on the trailer was to be delivered to the petitioner's customer. It also came upon the
sales invoice covering the transaction. The members of the team then introduced themselves to the caretaker, one
Ms. Chua, who turned out to be the wife of the petitioner's president and general manager, Mr. Ri Chuy Po, who was
then out of town. The team's photographer was able to take photographs of the stockpiles of lumber including newly
cut ones, fresh dust around sawing or cutting machineries and equipment, and the transport vehicles loaded with
lumber. The team thereupon effected a constructive seizure of approximately 20,000 board feet of lauan lumber in
assorted sizes stockpiled in the premises by issuing a receipt
therefor. 10

As a consequence of this 17 September 1990 incident, the petitioner filed with the RTC of Manila a petition
for certiorari and prohibition. The case (hereinafter, the SECOND CIVIL CASE) was docketed as Civil Case No. 90-
54610 and assigned to Branch 24 of the said court.

In the meantime, Robles filed with the Department of Justice (DOJ) a complaint against the petitioner's president and
general manager, Ri Chuy Po, for violation of Section 68 of P.D. No. 705, as amended by E.O. No. 277. After
appropriate preliminary investigation, the investigating prosecutor, Claro Arellano, handed down a resolution 11whose
dispositive portion reads:

WHEREFORE, premises considered, it is hereby recommended that an information be filed against


respondent Ri Chuy Po for illegal possession of approximately 200,000 bd. ft. of lumber consisting
of almaciga and supa and for illegal shipment of almaciga and lauan in violation of Sec. 68 of PD
705 as amended by E.O. 277, series of 1987.

It is further recommended that the 30,000 bd. ft. of narra shorts, trimmings and slabs covered by
legal documents be released to the rightful owner, Malupa. 12

This resolution was approved by Undersecretary of Justice Silvestre H. Bello III, who served as Chairman of the Task
Force on Illegal Logging." 13

On the basis of that resolution, an information was filed on 5 June 1991 by the DOJ with Branch 172 of the RTC of
Valenzuela, charging Ri Chuy Po with the violation of Section 58 of P.D. No. 705, as amended, which was docketed
as Criminal Case No. 324-V-91 (hereinafter, the CRIMINAL CASE). The accusatory portion of the information reads
as follows:

That on or about the 3rd day of April 1990, or prior to or subsequent thereto, within the premises
and vicinity of Mustang Lumber, Inc. in Fortune Village, Valenzuela, Metro Manila, and within the
jurisdiction of this Honorable Court, the above-named accused, did then and there wilfully,
feloniously and unlawfully have in his possession truckloads of almaciga and lauan and
approximately 200,000 bd. ft. of lumber and shorts of various species including almaciga and supa,
without the legal documents as required under existing forest laws and
regulations. 14

15
On 7 June 1991, Branch 35 of the RTC of Manila rendered its decision in the FIRST CIVIL CASE, the dispositive
portion of which reads:

WHEREFORE, judgment in this case is rendered as follows:

1. The Order of Respondent Secretary of the DENR, the Honorable Fulgencio S. Factoran, Jr.,
dated 3 May 1990 ordering the confiscation in favor of the Government the approximately 311,000
board feet of Lauan, supa, end almaciga Lumber, shorts and sticks, found inside and seized from
the Lumberyard of the petitioner at Fortune Drive, Fortune Village, Paseo de Blas, Valenzuela,
Metro Manila, on April 4, 1990 (Exhibit 10), is hereby set aside and vacated, and instead the
respondents are required to report and bring to the Hon. Adriano Osorio, Executive Judge,
Regional Trial Court, NCR, Valenzuela, Metro Manila, the said 311,000 board feet of Lauan, supa
and almaciga Lumber, shorts and sticks, to be dealt with as directed by Law;

2. The respondents are required to initiate and prosecute the appropriate action before the proper
court regarding the Lauan and almaciga lumber of assorted sizes and dimensions Loaded in
petitioner's truck bearing Plate No. CCK-322 which were seized on April 1, 1990;
3. The Writ of Preliminary Injunction issued by the Court on August 2, 1990 shall be
rendered functus oficio upon compliance by the respondents with paragraphs 1 and 2 of this
judgment;.

4. Action on the prayer of the petitioner that the Lauan, supa and almaciga lumber, shorts and
sticks mentioned above in paragraphs 1 and 2 of this judgment be returned to said petitioner is
withheld in this case until after the proper court has taken cognizance and determined how those
Lumber, shorts and sticks should be disposed of; and

5. The petitioner is ordered to pay the costs.

SO ORDERED.

In resolving the said case, the trial court held that the warrantless search and seizure on 1 April 1990 of the
petitioner's truck, which was moving out from the petitioner's lumberyard in Valenzuela, Metro Manila, loaded with
large volumes of lumber without covering document showing the legitimacy of its source or origin did not offend the
constitutional mandate that search and seizure must be supported by a valid warrant. The situation fell under one of
the settled and accepted exceptions where warrantless search and seizure is justified, viz., a search of a moving
vehicle. 16 As to the seizure of a large volume of almaciga, supa, and lauan lumber and shorts effected on 4 April
1990, the trial court ruled that the said seizure was a continuation of that made the previous day and was still
pursuant to or by virtue of the search warrant issued by Executive Judge Osorio whose validity the petitioner did not
even question. 17 And, although the search warrant did not specifically mention almaciga, supa, and lauan lumber
and shorts, their seizure was valid because it is settled that the executing officer is not required to ignore contrabands
observed during the conduct of the
search.18

The trial court, however, set aside Secretary Factoran's order of 3 May 1990 ordering the confiscation of the seized
articles in favor of the Government for the reason that since the articles were seized pursuant to the search warrant
issued by Executive Judge Osorio they should have been returned to him in compliance with the directive in the
warrant.

As to the propriety of the 23 April 1990 order of Secretary Factoran, the trial court ruled that the same had been
rendered moot and academic by the expiration of the petitioner's lumber dealer's permit on 25 September 1990, a
fact the petitioner admitted in its memorandum.

The petitioner forthwith appealed from the decision in the FIRST CIVIL CASE to the Court of Appeals, which
docketed the appeal as CA-G.R. SP No. 25510.

On 7 July 1991, accused Ri Chuy Po filed in the CRIMINAL CASE a Motion to Quash and/or to Suspend Proceedings
based on the following grounds: (a) the information does not charge an offense, for possession of lumber, as
opposed to timber, is not penalized in Section 68 of P.D. No. 705, as amended, and even
grantingarguendo that lumber falls within the purview of the said section, the same may not be used in evidence
against him for they were taken by virtue of an illegal seizure; and (b) Civil Case No. 90-53648 of Branch 35 of the
RTC of Manila, the FIRST CIVIL CASE, then pending before the Court of Appeals, which involves the legality of the
seizure, raises a prejudicial question. 19

The prosecution opposed the motion alleging that lumber is included in Section 68 of P.D. No. 705, as amended, and
possession thereof without the required legal documents is penalized therein. It referred to Section 3.2 of DENR
Administrative Order No. 19, series of 1989, for the definitions of timber and lumber, and then argued that exclusion
of lumber from Section 68 would defeat the very purpose of the law, i.e., to minimize, if not halt, illegal logging that
has resulted in the rapid denudation of our forest resources. 20

In her order of 16 August 1991 in the CRIMINAL CASE, 21 respondent Judge Teresita Dizon-Capulong granted the
motion to quash and dismissed the case on the ground that "possession of lumber without the legal documents
required by forest laws and regulations is not a crime. 22
Its motion for reconsideration having been denied in the order of 18 October 1991, 23 the People filed a petition
for certiorari with this Court in G.R. No. 106424, wherein it contends that the respondent Judge acted with grave
abuse of discretion in granting the motion to quash and in dismissing the case.

On 29 November 1991, the Court of Appeals rendered a decision 24 in CA-G.R. SP No. 25510 dismissing for lack of
merit the petitioner's appeal from the decision in the FIRST CIVIL CASE and affirming the trial court's rulings on the
issues raised. As to the claim that the truck was not carrying contraband articles since there is no law punishing the
possession of lumber, and that lumber is not timber whose possession without the required legal documents is
unlawful under P.D. No. 705, as amended, the Court of Appeals held:

This undue emphasis on lumber or the commercial nature of the forest product involved has always
been foisted by those who claim to be engaged in the legitimate business of lumber dealership. But
what is important to consider is that when appellant was required to present the valid documents
showing its acquisition and lawful possession of the lumber in question, it failed to present any
despite the period of extension granted to it. 25

The petitioner's motion to reconsider the said decision was denied by the Court of Appeals in its resolution of 3 March
1992. 26 Hence, the petitioner came to this Court by way of a petition for review on certiorari in G.R. No. 104988,
which was filed on 2 May 1992. 27

On 24 September 1992, Branch 24 of the RTC of Manila handed down a decision in the SECOND CIVIL CASE
dismissing the petition for certiorari and prohibition because (a) the petitioner did not exhaust administrative
remedies; (b) when the seizure was made on 17 September 1990 the petitioner could not lawfully sell lumber, as its
license was still under suspension; (c) the seizure was valid under Section 68-A of P.D. No. 705, as amended; and
(d) the seizure was justified as a warrantless search and seizure under Section 80 of P.D. No. 705, as amended.

The petitioner appealed from the decision to the Court of Appeals, which docketed the appeal as CA-G.R. SP
No.33778.

In its decision 28 of 31 July 1995, the Court of Appeals dismissed the petitioner's appeal in CA-G.R. SP No. 33778 for
lack of merit and sustained the grounds relied upon by the trial court in dismissing the SECOND CIVIL CASE. Relying
on the definition of "lumber" by Webster, viz., "timber or logs, especially after being prepared for the market," and by
the Random House Dictionary of the English Language, viz., "wood, esp. when suitable or adapted for various
building purposes," the respondent Court held that since wood is included in the definition of forest product in Section
3(q) of P.D. No. 705, as amended, lumber is necessarily included in Section 68 under the term forest product.

The Court of Appeals further emphasized that a forest officer or employee can seize the forest product involved in a
violation of Section 68 of P.D. No. 705 pursuant to Section 80 thereof, as amended by P.D. No. 1775, which provides
in part as follows:

Sec. 80. Arrest, Institution of Criminal Actions. -- A forest officer or employee of the Bureau or any
personnel of the Philippine Constabulary/Integrated National Police shall arrest even without
warrant any person who has committed or is committing in his presence any of the offenses
defined in this chapter. He shall also seize and confiscate, in favor of the Government, the tools
and equipment used in committing the offense, or the forest products cut, gathered or taken by the
offender in the process of committing the offense.

Among the offenses punished in the chapter referred to in said Section 80 are the cutting, gathering, collection, or
removal of timber or other forest products or possession of timber or other forest products without the required legal
documents.

Its motion to reconsider the decision having been denied by the Court of Appeals in the resolution of 6 February
1996, the petitioner filed with this Court on 27 February 1996 a petition for review on certiorari in G.R. No. 123784.

We shall now resolve these three cases starting with G.R. No. 106424 with which the other two were consolidated.

G.R. No. 106424


The petitioner had moved to quash the information in Criminal Case No. 324-V-91 on the ground that it does not
charge an offense. Respondent Judge Dizon-Capulong granted the motion reasoning that the subject matter of the
information in the CRIMINAL CASE is LUMBER, which is neither "timber" nor "other forest product" under Section 68
of P.D. No. 705, as amended, and hence, possession thereof without the required legal documents is not prohibited
and penalized under the said section.

Under paragraph (a), Section 3, Rule 117 of the Rules of Court, an information may be quashed on the ground that
the facts alleged therein do not constitute an offense. It has been said that "the test for the correctness of this ground
is the sufficiency of the averments in the information, that is, whether the facts alleged, if hypothetically admitted,
constitute the elements of the
offense, 29 and matters aliunde will not be considered." Anent the sufficiency of the information, Section 6, Rule 110
of the Rules of Court requires, inter alia, that the information state the acts or omissions complained of as constituting
the offense.

Respondent Ri Chuy Po is charged with the violation of Section 68 of P.D. No. 705, as amended by E.O. No. 277,
which provides:

Sec. 68. Cutting, Gathering and/or collecting Timber, or Other Forest Products Without License. --
Any person who shall cut, gather, collect, remove timber or other forest products from any forest
land, or timber from alienable or disposable public land, or from private land, without any authority,
or possess timber or other forest products without the legal documents as required under existing
forest laws and regulations, shall be punished with the penalties imposed under Articles 309 and
310 of the Revised Penal Code: Provided, That in the case of partnerships, associations, or
corporations, the officers who ordered the cutting, gathering, collection or possession shall be
liable, and if such officers are aliens, they shall, in addition to the penalty, be deported without
further proceedings on the part of the Commission on Immigration and Deportation.

The Court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found.

Punished then in this section are (1) the cutting, gathering, collection, or removal of timber or other forest
products from the places therein mentioned without any authority; and (b) possession of timber forest
products without the legal documents as required under existing forest laws and regulations.

Indeed, the word lumber does not appear in Section 68. But conceding ex gratia that this omission amounts to an
exclusion of lumber from the section's coverage, do the facts averred in the information in the CRIMINAL CASE
validly charge a violation of the said section?

A cursory reading of the information readily leads us to an infallible conclusion that lumber is not solely its subject
matter. It is evident therefrom that what are alleged to be in the possession of the private respondent, without the
required legal documents, are truckloads of

(1) almaciga and lauan; and

(2) approximately 200,000 bd. ft. of lumber and shorts of various species
including almaciga and supa.

The "almaciga and lauan" specifically mentioned in no. (1) are not described as "lumber." They cannot refer
to the "lumber" in no. (2) because they are separated by the words "approximately 200,000 bd. ft." with the
conjunction "and," and not with the preposition "of." They must then be raw forest products or, more
specifically, timbers under Section 3(q) of P.D. No. 705, as amended, which reads:

Sec. 3. Definitions. --

xxx xxx xxx


(q) Forest product means timber, firewood, bark, tree top, resin, gum, wood, oil,
honey, beeswax, nipa, rattan, or other forest plant, the associated water, fish
game, scenic, historical, recreational and geological resources in forest lands.

It follows then that lumber is only one of the items covered by the information. The public and the private respondents
obviously miscomprehended the averments in the information. Accordingly, even if lumber is not included in Section
68, the other items therein as noted above fall within the ambit of the said section, and as to them, the information
validly charges an offense.

Our respected brother, Mr. Justice Jose C. Vitug, suggests in his dissenting opinion that this Court go beyond the four
corners of the information for enlightenment as to whether the information exclusively refers to lumber. With the aid of
the pleadings and the annexes thereto, he arrives at the conclusion that "only lumber has been envisioned in the
indictment."

The majority is unable to subscribe to his view. First, his proposition violates the rule that only the facts alleged in the
information vis-a-vis the law violated must be considered in determining whether an information charges an offense.

Second, the pleadings and annexes he resorted to are insufficient to justify his conclusion. On the contrary, the Joint
Affidavit of Melencio Jalova, Jr., and Araman Belleng, which is one of the annexes he referred to, 30 cannot lead one
to infer that what the team seized was all lumber. Paragraph 8 thereof expressly states:

8. That when inside the compound, the team found approximately four (4)
truckloads of narra shorts, trimmings and slabs and a negligible amount of narra
lumber, and approximately 200,000 bd. ft. of lumber and shorts of various
species including almaciga and supa which are classified as prohibited wood
species. (emphasis supplied)

In the same vein, the dispositive portion of the resolution 31 of the investigating prosecutor, which served as
the basis for the filing of the information, does not limit itself to lumber; thus:

WHEREFORE, premises considered, it is hereby recommended that an information be filed against


respondent Ri Chuy Po for illegal possession of 200,000 bd. ft. of lumber consisting of almaciga
and supa and for illegal shipment of almaciga and lauan in violation of Sec. 63 of PD 705 as
amended by E.O. 277, series of 1987. (emphasis supplied)

The foregoing disquisitions should not, in any manner, be construed as an affirmance of the respondent Judge's
conclusion that lumber is excluded from the coverage of Section 68 of P.D. No. 705, as amended, and thus
possession thereof without the required legal documents is not a crime. On the contrary, this Court rules that such
possession is penalized in the said section because lumber is included in the term timber.

The Revised Forestry Code contains no definition of either timber or lumber. While the former is included in forest
products as defined in paragraph (q) of Section 3, the latter is found in paragraph (aa) of the same section in the
definition of "Processing plant," which reads:

(aa) Processing plant is any mechanical set-up, machine or combination of


machine used for the processing of logs and other forest raw materials
into lumber, veneer, plywood, wallbond, blockboard, paper board, pulp, paper or
other finished wood products.

This simply means that lumber is a processed log or processed forest raw material. Clearly, the Code uses
the term lumber in its ordinary or common usage. In the 1993 copyright edition of Webster's Third New
International Dictionary, lumber is defined, inter alia, as "timber or logs after being prepared for the
market." 32Simply put, lumber is a processed log or timber.

It is settled that in the absence of legislative intent to the contrary, words and phrases used in a statute should be
given their plain, ordinary, and common usage meaning. 33 And insofar as possession of timber without the required
legal documents is concerned, Section 68 of P.D. No. 705, as amended, makes no distinction between raw or
processed timber. Neither should we. Ubi lex non distinguere debemus.
Indisputably, respondent Judge Teresita Dizon-Capulong of Branch 172 of the RTC of Valenzuela, Metro Manila,
committed grave abuse of discretion in granting the motion to quash the information in the CRIMINAL CASE and in
dismissing the said case.

G.R. No. 104988

We find this petition to be without merit. The petitioner has miserably failed to show that the Court of Appeals
committed any reversible error in its assailed decision of 29 November 1991.

It was duly established that on 1 April 1990, the petitioner's truck with Plate No. CCK-322 was coming out from the
petitioner's lumberyard loaded with lauan and almaciga lumber of different sizes and dimensions which were not
accompanied with the required invoices and transport documents. The seizure of such truck and its cargo was a valid
exercise of the power vested upon a forest officer or employee by Section 80 of P.D. No. 705, as amended by P.D.
No. 1775. Then, too, as correctly held by the trial court and the Court of Appeals in the FIRST CIVIL CASE, the
search was conducted on a moving vehicle. Such a search could be lawfully conducted without a search warrant.

Search of a moving vehicle is one of the five doctrinally accepted exceptions to the constitutional mandate 34 that no
search or seizure shall be made except by virtue of a warrant issued by a judge after personally determining the
existence of probable cause. The other exceptions are (3) search as an incident to a lawful arrest, (2) seizure of
evidence in plain view, (3) customs searches, and (4) consented warrantless search. 35

We also affirm the rulings of both the trial court and the Court of Appeals that the search on 4 April 1990 was a
continuation of the search on 3 April 1990 done under and by virtue of the search warrant issued on 3 April 1990 by
Executive Judge Osorio. Under Section 9, Rule 126 of the Rules of Court, a search warrant has a lifetime of ten days.
Hence, it could be served at any time within the said period, and if its object or purpose cannot be accomplished in
one day, the same may be continued the following day or days until completed. Thus, when the search under a
warrant on one day was interrupted, it may be continued under the same warrant the following day, provided it is still
within the ten-day period. 36

As to the final plea of the petitioner that the search was illegal because possession of lumber without the required
legal documents is not illegal under Section 68 of P.D. No. 705, as amended, since lumber is neither specified therein
nor included in the term forest product, the same hardly merits further discussion in view of our ruling in G.R. No.
106424.

G.R. No. 123784

The allegations and arguments set forth in the petition in this case palpally fail to shaw prima facie that a reversible
error has been committed by the Court of Appeals in its challenged decision of 31 July 1995 and resolution of 6
February 1996 in CA-G.R. SP No. 33778. We must, forthwith, deny it for utter want of merit. There is no need to
require the respondents to comment on the petition.

The Court of Appeals correctly dismissed the petitioner's appeal from the judgment of the trial court in the SECOND
CIVIL CASE. The petitioner never disputed the fact that its lumber-dealer's license or permit had been suspended by
Secretary Factoran on 23 April 1990. The suspension was never lifted, and since the license had only a lifetime of up
to 25 September 1990, the petitioner has absolutely no right to possess, sell, or otherwise dispose of lumber.
Accordingly, Secretary Factoran or his authorized representative had the authority to seize the Lumber pursuant to
Section 68-A of P.D. No. 705, as amended, which provides as follows:

Sec. 68-A Administrative Authority of the Department Head or his Duly Authorized Representative
to Order Confiscation. -- In all cases of violations of this Code or other forest laws, rules and
regulations, the Department Head or his duly authorized representative may order the confiscation
of any forest products illegally cut, gathered, removed, or possessed or abandoned. . . .

The petitioner's insistence that possession or sale of lumber is not penalized must also fail view of our disquisition
and ruling on the same issue in G.R. No. 106424. Besides, the issue is totally irrelevant in the SECOND CIVIL CASE
which involves administrative seizure as a consequence of the violation of the suspension of the petitioner's license
as lumber dealer.
All told then, G.R. No. 104988 and G.R. No. 123784 are nothing more than rituals to cover up blatant violations of the
Revised Forestry Code of the Philippines (P.D. No. 705), as amended. They are presumably trifling attempts to block
the serious efforts of the DENR to enforce the decree, efforts which deserve the commendation of the public in light
of the urgent need to take firm and decisive action against despoilers of our forests whose continuous destruction
only ensures to the generations to come, if not the present, an inheritance of parched earth incapable of sustaining
life. The Government must not tire in its vigilance to protect the environment by prosecuting without fear or favor any
person who dares to violate our laws for the utilization and protection of our forests.

WHEREFORE, judgment is hereby rendered

1. (a) GRANTING the petition in G.R. No. 106424; (b) SETTING ASIDE and ANNULLING, for
having been rendered with grave abuse of discretion, the challenged orders of 16 August 1991 and
18 October 1991 of respondent Judge Teresita Dizon-Capulong, Branch 172, Regional Trial Court
of Valenzuela, Metro Manila, in Criminal Case No. 324-V-91, entitled "People of the Philippines vs.
Ri Chuy Po"; (c) REINSTATING the information in the said criminal case; and (d) DIRECTING the
respondent Judge or her successor to hear and decide the case with purposeful dispatch; and

2. DENYING the petitions in G.R. No. 104988 and in G. R. No. 123784 for utter failure of the
petitioner to show that the respondent Court of Appeals committed any reversible error in the
challenged decisions of 29 November 1991 in CA-G.R. SP No. 25510 in the FIRST CIVIL CASE
and of 31 July 1995 in CA-G.R. SP No. 33778 on the SECOND CIVIL CASE.

Costs against the petitioner in each of these three cases.

SO ORDERED.

Narvasa, C.J., Padilla, Regalado, Romero, Bellosillo, Melo, Puno, Kapunan, Mendoza, Francisco, Hermosisima, Jr.,
Panganiban and Torres, Jr., JJ., concur.

Separate Opinions

VITUG, J., dissenting:

The prosecution seeks, in its petition for review on certiorari in G.R. No. 106424, the annulment of the 16th August
1991 Order of respondent Judge granting the motion of private respondent Ri Chuy Po to quash the information that
has charged him with the Violation of Section 68 of Presidential Decree ("PD") No. 705 (otherwise known as the
Forestry Reform Code, as amended by Executive Order ["EO"] No. 277 1) and the 18th October 1991 Order denying
petitioner's motion for reconsideration.

The information of 04 June 1991, containing the alleged inculpatory facts against private respondent, reads:

The undersigned State Prosecutor hereby accuses RI CHUY PO of the crime of violation of Section
68, Presidential Decree No. 705, as amended by Executive Order No. 277, Series of 1987,
committed as follows:

"That on or about the 3rd day of April 1990, or prior to or subsequent thereto,
within the premises and vicinity of Mustang Lumber, Inc. in Fortune Drive,
Fortune Village, Valenzuela, Metro Manila, and within the jurisdiction of this
Honorable Court, the above-named accused, did then and there wilfully,
feloniously and unlawfully, have in his possession truckloads of almaciga and
lauan and approximately 200,000 bd. ft. of lumber and shorts of various species
including almaciga and supa, without the legal documents as required under
existing forest laws and regulations.

"CONTRARY TO LAW."2

Private respondent, on 10 July 1991, moved for the quashal of the information on the ground that the facts
comprising the charge did not amount to a criminal offense, or in the alternative, to suspend the proceedings on the
ground of a prejudicial question, private respondent having formally challenged the legality of the seizure of the
lumber in question in a civil case before the Regional Trial Court ("RTC") of Manila, Branch 35, and now pending with
the Court of Appeals.

On 16 August 1991, the trial court promulgated its now questioned order granting the motion of private respondent to
quash the information. It ruled that, unlike the possession of "timber or other forest products" (without supporting legal
documents), the mere possession of "lumber" had not itself been declared a criminal offense under Section 68 of PD
705. Petitioner moved for a reconsideration insisting that lumber should be held to come within the purview of
"timber" defined by Section 2.26 (b) of DENR Administrative Order No. 50, Series of 1986. The motion for
reconsideration was denied; hence, the petition for review on certiorari filed by the prosecution before this Court.

Private respondent maintains (1) that PD 705 distinguishes "timber" and "other forest products," on the one hand,
from "lumber" and "other finished wood products," on the other, and that the possession of lumber of any specie, size
or dimension, whether it be lauan, tanguile, apitong, almaciga, supa, or narra, is not under that law declared a
criminal offense; (2) that DENR Administrative Order No. 74, Series of 1987, totally bans the cutting, handling and
disposition of almaciga trees but that possession of almaciga lumber is not considered illegal; (3) that while under
DENR Administrative Order No. 78, Series of 1987, the cutting or gathering of narra and other premium hardwood
species (supa included) is prohibited, it does not, however, make possession of premium hardwood lumber (narra
and supa included) punishable by mere inference; and (4) that Bureau of Forest Development Circular No. 10, Series
of 1983, clarified by DENR Memorandum No. 12, Series of 1988, requires a certificate of lumber origin ("CLO") only
on lumber shipped outside the province, city or the greater Manila area to another province or city or, in lieu of a CLO,
an invoice to accompany a lumber shipment from legitimate sources if the origin and destination points are both
within the greater Manila area or within the same province or city, and not, like in the instant case, where the lumber
is not removed from the lumber yard.

Petitioner counters (1) that the almaciga, supa and lauan lumber products found in the compound of Mustang
Lumber, Inc., are included in Section 68, PD 705, as amended by EO No. 277, the possession of which without
requisite legal documents is penalized under Section 3.2 of DENR Administrative Order No. 19, Series of 1989, dated
17 March 1989, that defines "lumber" to be a --

. . . solid wood not further manufactured other than sawing, resawing, kiln-drying and passing
lengthwise through a standard planing machine, including boules or unedged lumber;

and "timber," under Section 1.11 of DENR Administrative Order No. 80, Series of 1987, dated 28 December
1987, to be --

. . . any piece of wood having an average diameter of at least 15 centimeters and at 1.5 meters
long, except all mangrove species which in all cases, shall be considered as timber regardless of
size;

which may either be --

a) Squared timber (or) timber squared with an ax or other similar mechanical


hard tools in the forest and which from the size of the piece and the character of
the wood is obviously unfit for use in that form (Sec. 1.10 DENR Administrative
Order No. 80, Series of 1987, dated December 28, 1987); or
b) Manufactured timber (or) timber other than round and squared timber shall
include logs longitudinally sawn into pieces, even if only to facilitate transporting
or hauling, as well as all sawn products, all timber hewn or otherwise worked to
approximate its finished form, such as house posts, ship keels, mine props, ties,
trolly poles, bancas, troughs, bowls, cart wheels, table tops and other similar
articles (Sec. 2.26, DENR Administrative Order No. 50, Series of 1986, dated
November 11, 1986) --

(2) that to exclude "lumber" under Section 68 of PD 705 would be to defeat the purpose of the law, i.e., to
stop or minimize illegal logging that has resulted in the rapid denudation of forest resources; (3) that the
claim of private respondent that a CLO is required only upon the transportation or shipment of lumber, and
not when lumber is merely stored in a compound, contravenes the provisions of Section 68 of PD 705; (4)
that the failure to show any CLO or other legal document required by administrative issuances raises the
presumption that the lumber has been shipped or received from illegal sources; and, (5) that the decision of
the RTC in Civil Case No. 90-53648 sustaining the legality of the seizure has rendered moot any possible
prejudicial issue to the instant case.

The real and kernel issue then brought up by the parties in G.R. No. 106424, as well as in the two consolidated cases
(G.R. No. 104988 and G.R. No. 123784), is whether or not the term "timber or other forest products" the possession
of which without the required legal documents would be a criminal offense under Section 68 of PD 705 also covers
"lumber".

Prefatorily, I might point out that the information, charging private respondent with the possession without required
legal documents of ". . . truckloads of almaciga and lauan and approximately 200,000 bd. ft. of lumber and shorts of
various species including almaciga and supa, . . ." has failed to specify whether the "almaciga" and "lauan" there
mentioned refer to "timber" or "lumber" or both. A perusal of the pleadings and annexes before the Court, however,
would indicate that only lumber has been envisioned in the indictment. For instance --

(a) The pertinent portions of the joint affidavit of Melencio Jalova, Jr., and Araman
Belleng,3 subscribed and sworn to before State Prosecutor Claro Arellano, upon which basis the
latter recommended the filing of the information, read, as follows:

"That during the weekend, (April 1 and 2, 1990) the security detail from our
agency continued to monitor the activities inside the compound and in fact
apprehended and later on brought to the DENR compound a six-wheeler
truck loaded with almaciga and lauan lumber after the truck driver failed to
produce any documents covering the shipment;

xxx xxx xxx

"That we are executing this affidavit in order to lodge a criminal complaint against
Mr. Ri Chuy Po, owner of Mustang Lumber for violation of Section 68, P.D. 705,
as amended by Executive Order 277, having in its possession prohibited wood
and wood products without the required documents."4 (Emphasis supplied)

(b) The resolution, dated 14 May 1991, issued by Investigating Prosecutor Arellano, approved by
Undersecretary of Justice Silvestre Bello III, confirmed that --

" . . . On April 1 and 2 1990, the security detail continued to monitor the activities
inside the compound and in fact apprehended a six-wheeler truck coming from
the compound of Mustang loaded with almaciga and lauan lumber without the
necessary legal documents covering the shipment."5

(c) The 23rd April 1990 Order of then DENR Secretary Fulgencio Factoran, suspending the
Certificate of Registration No. NRD-4-092590-0469 of Mustang Lumber, Inc., was issued because
of, among other things, the latter's possession of almaciga lumber without the required documents.6
(d) The subsequent 03rd May 1990 Order, likewise issued by Secretary Factoran, authorized the
confiscation of approximately 311,000 board feet of lauan, supa and almaciga lumber, shorts and
sticks of various sizes and dimensions owned by Mustang Lumber, Inc. 7

(e) The complaint filed on 27 July 1990 by Vincent A. Robles, Chief, PIC/SAID, DENR, before the
Department of Justice, Manila, against private respondent was for possession of lauan and
almaciga lumber without required legal documents,8 in violation of P.D. 705, as amended by EO
277.

(f) The prosecution, in its opposition to private respondent's motion to quash, sought to argue that
the possession of "almaciga, supa and lauan lumber found in the compound of Mustang Lumber,
Inc.,9 was covered by the penal provisions of P.D. 705, as amended, pursuant to Section 32 of
DENR Administrative Order No. 19, Series of 1989.

Indeed, the instant petition itself questions the quashal order of the court a quo solely on the thesis that "lumber"
should be held to be among the items that are banned under Section 68 of PD 705.

While generally factual matters outside of the information should not weigh in resolving a motion to quash following
the standing rule that the allegations of the information must alone be considered and should not be challenged, there
should, however, be no serious objections to taking into account additional and clarificatory facts which, although not
made out in the information, are admitted, conceded, or not denied by the parties. As early as the case of People
vs. Navarro, 10 reiterated in People vs. Dela Rosa, 11 the Court has had occasion to explain --

. . . It would seem to be pure technicality to hold that in the consideration of the motion the parties
and the judge were precluded from considering facts which the fiscal admitted to be true, simply
because they were not described in the complaint. Of course, it may be added that upon similar
motions the court and the fiscal are not required to go beyond the averments of the information, nor
is the latter to be inveigled into a premature and risky revelation of his evidence. But we see no
reason to prohibit the fiscal from making, in all candor, admissions of undeniable facts, because the
principle can never be sufficiently reiterated that such official's role is to see that justice is done: not
that all accused are convicted, but that the guilty are justly punished. Less reason can there be to
prohibit the court from considering those admissions, and deciding accordingly, in the interest of a
speedy administration of justice.

And now on the main substantive issue.

Section 68 of PD 705, as amended by EO No. 277, reads:

Sec. 68. Cutting, Gathering and/or Collecting Timber or Other Forest Products Without License. --
Any person who shall cut, gather, collect, remove timber or other forest products from any forest
land, or timber from alienable or disposable public land, or from private land, without any authority,
or possess timber or other forest products without the legal documents as required under existing
forest laws and regulations, shall be punished with the penalties imposed under Articles 309 and
310 of the Revised Penal Code: Provided, That in the case of partnerships, associations, or
corporations, the officers who ordered the cutting, gathering, collection or possession shall be
liable, and if such officers are aliens, they shall, in addition to the penalty, be deported without
further proceedings on the part of the Commission on Immigration and Deportation.

The Court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found.

I agree with the court a quo that the coverage of Section 68, PD 705, as so amended, is explicit, and it is confined to
"timber and other forest products." Section 3(q) of the decree defines "forest product" to mean --

(q) . . . timber, pulpwood, firewood, bark, tree top, resin, gum, wood, oil, honey, beeswax, nipa,
rattan, or other forest growth such as grass, shrub, and flowering plant, the associated water, fish,
game, scenic, historical, recreational and geologic resources in forest lands (emphasis supplied);
and distinguishes it, in correlation with Section 3(aa) of the law, from that which has undergone processing.
In defining a "processing plant," this section of the decree holds it to refer to --

. . . any mechanical set-up, machine or combination of machine used for the processing of logs and
other forest raw materials into lumber veneer, plywood, wallboard, block-board, paper board, pulp,
paper or other finished wood products (emphasis supplied).

In fine, timber is so classified, under Section 3(q) of the law, as a forest product, while lumber has been
categorized, under Section 3(aa), among the various finished wood products.

The various DENR issuances, cited by the Solicitor General, to wit:

(1) Section 1.11 of the DENR Order No. 80, dated 28 December 1987, Series of 1987, which defines "timber" to be --

. . . any piece of wood having an average diameter of at least 15 centimeters and at 1.5 meters
long, except all mangrove species which in all cases, shall be considered as timber regardless of
size; 12

(2) Section 3.2 of DENR Administrative Order No. 19, dated 17 March 1989, Series of 1989, stating that "lumber"
includes --

. . . solid wood not further manufactured other than sawing, resawing, kiln-drying and passing lengthwise through a
standard planing machine, including boules or unedged lumber;" and

(3) DENR Memorandum Order No. 36, Series of 1988, dated 06 May 1988, to the effect that the term "forest
products" shall include "lumber --

cannot, in my view, go beyond the clear language of the basic law.

While great weight is ordinarily accorded to an interpretation or construction of a statute by the government agency
called upon to implement the enactment, 13 the rule would only be good, however, to the extent that such
interpretation or construction is congruous with the governing statute. 14 Administrative issuances can aptly carry the
law into effect 15 but it would be legal absurdity to allow such issuances to also have the effect, particularly those
which are penal in nature, of extending the scope of the law or its plain
mandate. 16

Accordingly, and with respect, I vote to deny the petition in G.R. No. 106424, to grant the petition in G.R. No. 104988
and to require comment on the petition in G.R. No. 123784. I must hasten to add, nevertheless, that I do appreciate
the well-meant rationale of DENR Memorandum Order No. 36, Series of 1988, for, indeed, the need for preserving
whatever remains of the country's forest reserves can never now be fully emphasized. Until properly addressed and
checked, the continued denudation of forest resources, already known to be the cause of no few disasters, as well as
of untold loss of lives and property, could well be on end the expected order of the day. I, therefore, join ail those who
call for the passage of remedial legislation before the problem truly becomes irreversible.

Separate Opinions

VITUG, J., dissenting:

The prosecution seeks, in its petition for review on certiorari in G.R. No. 106424, the annulment of the 16th August
1991 Order of respondent Judge granting the motion of private respondent Ri Chuy Po to quash the information that
has charged him with the Violation of Section 68 of Presidential Decree ("PD") No. 705 (otherwise known as the
Forestry Reform Code, as amended by Executive Order ["EO"] No. 277 1) and the 18th October 1991 Order denying
petitioner's motion for reconsideration.
The information of 04 June 1991, containing the alleged inculpatory facts against private respondent, reads:

The undersigned State Prosecutor hereby accuses RI CHUY PO of the crime of violation of Section
68, Presidential Decree No. 705, as amended by Executive Order No. 277, Series of 1987,
committed as follows:

"That on or about the 3rd day of April 1990, or prior to or subsequent thereto,
within the premises and vicinity of Mustang Lumber, Inc. in Fortune Drive,
Fortune Village, Valenzuela, Metro Manila, and within the jurisdiction of this
Honorable Court, the above-named accused, did then and there wilfully,
feloniously and unlawfully, have in his possession truckloads of almaciga and
lauan and approximately 200,000 bd. ft. of lumber and shorts of various species
including almaciga and supa, without the legal documents as required under
existing forest laws and regulations.

"CONTRARY TO LAW."2

Private respondent, on 10 July 1991, moved for the quashal of the information on the ground that the facts
comprising the charge did not amount to a criminal offense, or in the alternative, to suspend the proceedings on the
ground of a prejudicial question, private respondent having formally challenged the legality of the seizure of the
lumber in question in a civil case before the Regional Trial Court ("RTC") of Manila, Branch 35, and now pending with
the Court of Appeals.

On 16 August 1991, the trial court promulgated its now questioned order granting the motion of private respondent to
quash the information. It ruled that, unlike the possession of "timber or other forest products" (without supporting legal
documents), the mere possession of "lumber" had not itself been declared a criminal offense under Section 68 of PD
705. Petitioner moved for a reconsideration insisting that lumber should be held to come within the purview of
"timber" defined by Section 2.26 (b) of DENR Administrative Order No. 50, Series of 1986. The motion for
reconsideration was denied; hence, the petition for review on certiorari filed by the prosecution before this Court.

Private respondent maintains (1) that PD 705 distinguishes "timber" and "other forest products," on the one hand,
from "lumber" and "other finished wood products," on the other, and that the possession of lumber of any specie, size
or dimension, whether it be lauan, tanguile, apitong, almaciga, supa, or narra, is not under that law declared a
criminal offense; (2) that DENR Administrative Order No. 74, Series of 1987, totally bans the cutting, handling and
disposition of almaciga trees but that possession of almaciga lumber is not considered illegal; (3) that while under
DENR Administrative Order No. 78, Series of 1987, the cutting or gathering of narra and other premium hardwood
species (supa included) is prohibited, it does not, however, make possession of premium hardwood lumber (narra
and supa included) punishable by mere inference; and (4) that Bureau of Forest Development Circular No. 10, Series
of 1983, clarified by DENR Memorandum No. 12, Series of 1988, requires a certificate of lumber origin ("CLO") only
on lumber shipped outside the province, city or the greater Manila area to another province or city or, in lieu of a CLO,
an invoice to accompany a lumber shipment from legitimate sources if the origin and destination points are both
within the greater Manila area or within the same province or city, and not, like in the instant case, where the lumber
is not removed from the lumber yard.

Petitioner counters (1) that the almaciga, supa and lauan lumber products found in the compound of Mustang
Lumber, Inc., are included in Section 68, PD 705, as amended by EO No. 277, the possession of which without
requisite legal documents is penalized under Section 3.2 of DENR Administrative Order No. 19, Series of 1989, dated
17 March 1989, that defines "lumber" to be a --

. . . solid wood not further manufactured other than sawing, resawing, kiln-drying and passing
lengthwise through a standard planing machine, including boules or unedged lumber;

and "timber," under Section 1.11 of DENR Administrative Order No. 80, Series of 1987, dated 28 December
1987, to be --

. . . any piece of wood having an average diameter of at least 15 centimeters and at 1.5 meters
long, except all mangrove species which in all cases, shall be considered as timber regardless of
size;
which may either be --

a) Squared timber (or) timber squared with an ax or other similar mechanical


hard tools in the forest and which from the size of the piece and the character of
the wood is obviously unfit for use in that form (Sec. 1.10 DENR Administrative
Order No. 80, Series of 1987, dated December 28, 1987); or

b) Manufactured timber (or) timber other than round and squared timber shall
include logs longitudinally sawn into pieces, even if only to facilitate transporting
or hauling, as well as all sawn products, all timber hewn or otherwise worked to
approximate its finished form, such as house posts, ship keels, mine props, ties,
trolly poles, bancas, troughs, bowls, cart wheels, table tops and other similar
articles (Sec. 2.26, DENR Administrative Order No. 50, Series of 1986, dated
November 11, 1986) --

(2) that to exclude "lumber" under Section 68 of PD 705 would be to defeat the purpose of the law, i.e., to
stop or minimize illegal logging that has resulted in the rapid denudation of forest resources; (3) that the
claim of private respondent that a CLO is required only upon the transportation or shipment of lumber, and
not when lumber is merely stored in a compound, contravenes the provisions of Section 68 of PD 705; (4)
that the failure to show any CLO or other legal document required by administrative issuances raises the
presumption that the lumber has been shipped or received from illegal sources; and, (5) that the decision of
the RTC in Civil Case No. 90-53648 sustaining the legality of the seizure has rendered moot any possible
prejudicial issue to the instant case.

The real and kernel issue then brought up by the parties in G.R. No. 106424, as well as in the two consolidated cases
(G.R. No. 104988 and G.R. No. 123784), is whether or not the term "timber or other forest products" the possession
of which without the required legal documents would be a criminal offense under Section 68 of PD 705 also covers
"lumber".

Prefatorily, I might point out that the information, charging private respondent with the possession without required
legal documents of ". . . truckloads of almaciga and lauan and approximately 200,000 bd. ft. of lumber and shorts of
various species including almaciga and supa, . . ." has failed to specify whether the "almaciga" and "lauan" there
mentioned refer to "timber" or "lumber" or both. A perusal of the pleadings and annexes before the Court, however,
would indicate that only lumber has been envisioned in the indictment. For instance --

(a) The pertinent portions of the joint affidavit of Melencio Jalova, Jr., and Araman
Belleng,3 subscribed and sworn to before State Prosecutor Claro Arellano, upon which basis the
latter recommended the filing of the information, read, as follows:

"That during the weekend, (April 1 and 2, 1990) the security detail from our
agency continued to monitor the activities inside the compound and in fact
apprehended and later on brought to the DENR compound a six-wheeler
truck loaded with almaciga and lauan lumber after the truck driver failed to
produce any documents covering the shipment;

xxx xxx xxx

"That we are executing this affidavit in order to lodge a criminal complaint against
Mr. Ri Chuy Po, owner of Mustang Lumber for violation of Section 68, P.D. 705,
as amended by Executive Order 277, having in its possession prohibited wood
and wood products without the required documents."4 (Emphasis supplied)

(b) The resolution, dated 14 May 1991, issued by Investigating Prosecutor Arellano, approved by
Undersecretary of Justice Silvestre Bello III, confirmed that --

" . . . On April 1 and 2 1990, the security detail continued to monitor the activities
inside the compound and in fact apprehended a six-wheeler truck coming from
the compound of Mustang loaded with almaciga and lauan lumber without the
necessary legal documents covering the shipment."5

(c) The 23rd April 1990 Order of then DENR Secretary Fulgencio Factoran, suspending the
Certificate of Registration No. NRD-4-092590-0469 of Mustang Lumber, Inc., was issued because
of, among other things, the latter's possession of almaciga lumber without the required documents.6

(d) The subsequent 03rd May 1990 Order, likewise issued by Secretary Factoran, authorized the
confiscation of approximately 311,000 board feet of lauan, supa and almaciga lumber, shorts and
sticks of various sizes and dimensions owned by Mustang Lumber, Inc.7

(e) The complaint filed on 27 July 1990 by Vincent A. Robles, Chief, PIC/SAID, DENR, before the
Department of Justice, Manila, against private respondent was for possession of lauan and
almaciga lumber without required legal documents,8 in violation of P.D. 705, as amended by EO
277.

(f) The prosecution, in its opposition to private respondent's motion to quash, sought to argue that
the possession of "almaciga, supa and lauan lumber found in the compound of Mustang Lumber,
Inc.,9 was covered by the penal provisions of P.D. 705, as amended, pursuant to Section 32 of
DENR Administrative Order No. 19, Series of 1989.

Indeed, the instant petition itself questions the quashal order of the court a quo solely on the thesis that "lumber"
should be held to be among the items that are banned under Section 68 of PD 705.

While generally factual matters outside of the information should not weigh in resolving a motion to quash following
the standing rule that the allegations of the information must alone be considered and should not be challenged, there
should, however, be no serious objections to taking into account additional and clarificatory facts which, although not
made out in the information, are admitted, conceded, or not denied by the parties. As early as the case of People
vs. Navarro, 10 reiterated in People vs. Dela Rosa, 11 the Court has had occasion to explain --

. . . It would seem to be pure technicality to hold that in the consideration of the motion the parties
and the judge were precluded from considering facts which the fiscal admitted to be true, simply
because they were not described in the complaint. Of course, it may be added that upon similar
motions the court and the fiscal are not required to go beyond the averments of the information, nor
is the latter to be inveigled into a premature and risky revelation of his evidence. But we see no
reason to prohibit the fiscal from making, in all candor, admissions of undeniable facts, because the
principle can never be sufficiently reiterated that such official's role is to see that justice is done: not
that all accused are convicted, but that the guilty are justly punished. Less reason can there be to
prohibit the court from considering those admissions, and deciding accordingly, in the interest of a
speedy administration of justice.

And now on the main substantive issue.

Section 68 of PD 705, as amended by EO No. 277, reads:

Sec. 68. Cutting, Gathering and/or Collecting Timber or Other Forest Products Without License. --
Any person who shall cut, gather, collect, remove timber or other forest products from any forest
land, or timber from alienable or disposable public land, or from private land, without any authority,
or possess timber or other forest products without the legal documents as required under existing
forest laws and regulations, shall be punished with the penalties imposed under Articles 309 and
310 of the Revised Penal Code: Provided, That in the case of partnerships, associations, or
corporations, the officers who ordered the cutting, gathering, collection or possession shall be
liable, and if such officers are aliens, they shall, in addition to the penalty, be deported without
further proceedings on the part of the Commission on Immigration and Deportation.

The Court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed, as well as the machinery, equipment,
implements and tools illegally used in the area where the timber or forest products are found.
I agree with the court a quo that the coverage of Section 68, PD 705, as so amended, is explicit, and it is confined to
"timber and other forest products." Section 3(q) of the decree defines "forest product" to mean --

(q) . . . timber, pulpwood, firewood, bark, tree top, resin, gum, wood, oil, honey, beeswax, nipa,
rattan, or other forest growth such as grass, shrub, and flowering plant, the associated water, fish,
game, scenic, historical, recreational and geologic resources in forest lands (emphasis supplied);

and distinguishes it, in correlation with Section 3(aa) of the law, from that which has undergone processing.
In defining a "processing plant," this section of the decree holds it to refer to --

. . . any mechanical set-up, machine or combination of machine used for the processing of logs and
other forest raw materials into lumber veneer, plywood, wallboard, block-board, paper board, pulp,
paper or other finished wood products (emphasis supplied).

In fine, timber is so classified, under Section 3(q) of the law, as a forest product, while lumber has been
categorized, under Section 3(aa), among the various finished wood products.

The various DENR issuances, cited by the Solicitor General, to wit:

(1) Section 1.11 of the DENR Order No. 80, dated 28 December 1987, Series of 1987, which defines "timber" to be --

. . . any piece of wood having an average diameter of at least 15 centimeters and at 1.5 meters
long, except all mangrove species which in all cases, shall be considered as timber regardless of
size; 12

(2) Section 3.2 of DENR Administrative Order No. 19, dated 17 March 1989, Series of 1989, stating that "lumber"
includes --

. . . solid wood not further manufactured other than sawing, resawing, kiln-drying and passing lengthwise through a
standard planing machine, including boules or unedged lumber;" and

(3) DENR Memorandum Order No. 36, Series of 1988, dated 06 May 1988, to the effect that the term "forest
products" shall include "lumber --

cannot, in my view, go beyond the clear language of the basic law.

While great weight is ordinarily accorded to an interpretation or construction of a statute by the government agency
called upon to implement the enactment, 13 the rule would only be good, however, to the extent that such
interpretation or construction is congruous with the governing statute. 14 Administrative issuances can aptly carry the
law into effect 15 but it would be legal absurdity to allow such issuances to also have the effect, particularly those
which are penal in nature, of extending the scope of the law or its plain
mandate. 16

Accordingly, and with respect, I vote to deny the petition in G.R. No. 106424, to grant the petition in G.R. No. 104988
and to require comment on the petition in G.R. No. 123784. I must hasten to add, nevertheless, that I do appreciate
the well-meant rationale of DENR Memorandum Order No. 36, Series of 1988, for, indeed, the need for preserving
whatever remains of the country's forest reserves can never now be fully emphasized. Until properly addressed and
checked, the continued denudation of forest resources, already known to be the cause of no few disasters, as well as
of untold loss of lives and property, could well be on end the expected order of the day. I, therefore, join ail those who
call for the passage of remedial legislation before the problem truly becomes irreversible.
SESINANDO MERIDA, G.R. No. 158182
Petitioner,
Present:

PUNO, C.J., Chairperson,


CARPIO,
- versus - AZCUNA,
CORONA, and
LEONARDO-DE CASTRO, JJ.

PEOPLE OF THE PHILIPPINES, Promulgated:


Respondent. June 12, 2008

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

CARPIO, J.:

The Case

This is a petition for review[1] of the Decision[2] dated 28 June 2002 and the Resolution dated 14 May 2003 of the Court of Appeals.
The 28 June 2002 Decision affirmed the conviction of petitioner Sesinando Merida (petitioner) for violation of Section
68,[3] Presidential Decree No. 705 (PD 705),[4] as amended by Executive Order No. 277. The Resolution dated 14 May 2003 denied
admission of petitioners motion for reconsideration.[5]

The Facts

Petitioner was charged in the Regional Trial Court of Romblon, Romblon, Branch 81 (trial court) with violation of Section
68 of PD 705, as amended, for cut[ting], gather[ing], collect[ing] and remov[ing] a lone narra tree inside a private land in Mayod,
Ipil, Magdiwang, Romblon (Mayod Property) over which private complainant Oscar M. Tansiongco (Tansiongco) claims
ownership.[6]

The prosecution evidence showed that on 23 December 1998, Tansiongco learned that petitioner cut a narra tree in
the Mayod Property. Tansiongco reported the matter to Florencio Royo (Royo), the punong barangay of Ipil. On 24 December
1998,[7] Royo summoned petitioner to a meeting with Tansiongco. When confronted during the meeting about the felled narra
tree, petitioner admitted cutting the tree but claimed that he did so with the permission of one Vicar Calix (Calix) who, according
to petitioner, bought the Mayod Property from Tansiongco in October 1987 under a pacto de retro sale. Petitioner showed to
Royo Calixs written authorization signed by Calixs wife.[8]

On 11 January 1999, Tansiongco reported the tree-cutting to the Department of Environment and Natural Resources
(DENR) forester Thelmo S. Hernandez (Hernandez) in Sibuyan, Romblon. When Hernandez confronted petitioner about the felled
tree, petitioner reiterated his earlier claim to Royo that he cut the tree with Calixs permission. Hernandez ordered petitioner not
to convert the felled tree trunk into lumber.
On 26 January 1999, Tansiongco informed Hernandez that petitioner had converted the narra trunk into lumber.
Hernandez, with other DENR employees and enforcement officers, went to the Mayod Property and saw that the narra tree had
been cut into six smaller pieces of lumber. Hernandez took custody of the lumber, [9] deposited them for safekeeping with Royo,
and issued an apprehension receipt to petitioner. A larger portion of the felled tree remained at the Mayod Property. The DENR
subsequently conducted an investigation on the matter.[10]

Tansiongco filed a complaint with the Office of the Provincial Prosecutor of Romblon (Provincial Prosecutor) charging
petitioner with violation of Section 68 of PD 705, as amended. During the preliminary investigation, petitioner submitted a
counter-affidavit reiterating his claim that he cut the narra tree with Calixs permission. The Provincial Prosecutor[11] found
probable cause to indict petitioner and filed the Information with the trial court (docketed as Criminal Case No. 2207).

During the trial, the prosecution presented six witnesses including Tansiongco, Royo, and Hernandez who testified on
the events leading to the discovery of and investigation on the tree-cutting. Petitioner testified as the lone defense witness and
claimed, for the first time, that he had no part in the tree-cutting.

The Ruling of the Trial Court

In its Decision dated 24 November 2000, the trial court found petitioner guilty as charged, sentenced him to fourteen (14) years,
eight (8) months and one (1) day to twenty (20) years of reclusion temporal and ordered the seized lumber forfeited in
Tansiongcos favor.[12] The trial court dismissed petitioners defense of denial in view of his repeated extrajudicial admissions that
he cut the narra tree in the Mayod Property with Calixs permission. With this finding and petitioners lack of DENR permit to cut
the tree, the trial court held petitioner liable for violation of Section 68 of PD 705, as amended.

Petitioner appealed to the Court of Appeals reiterating his defense of denial. Petitioner also contended that (1) the trial court did
not acquire jurisdiction over the case because it was based on a complaint filed by Tansiongco and not by a forest officer as
provided under Section 80 of PD 705 and (2) the penalty imposed by the trial court is excessive.

The Ruling of the Court of Appeals

In its Decision dated 28 June 2002, the Court of Appeals affirmed the trial courts ruling but ordered the seized lumber confiscated
in the governments favor.[13] The Court of Appeals sustained the trial courts finding that petitioner is bound by his extrajudicial
admissions of cutting the narra tree in the Mayod Property without any DENR permit. The Court of Appeals also found nothing
irregular in the filing of the complaint by Tansiongco instead of a DENR forest officer considering that the case underwent
preliminary investigation by the proper officer who filed the Information with the trial court.

On the imposable penalty, the Court of Appeals, in the dispositive portion of its ruling, sentenced petitioner to 14 years, 8 months
and 1 day to 17 years of reclusion temporal. However, in the body of its ruling, the Court of Appeals held that the penalty to be
imposed on [petitioner] should be (14) years, eight (8) months and one (1) day to twenty (20) years of reclusion temporal,[14] the
same penalty the trial court imposed.

Petitioner sought reconsideration but the Court of Appeals, in its Resolution dated 14 May 2003, did not admit his motion for
having been filed late.[15]
Hence, this petition. Petitioner raises the following issues:

I. WHETHER x x x SECTION 68 OF P.D. 705 AS AMENDED PROHIBITING THE CUTTING, GATHERING,


COLLECTING AND REMOVING TIMBER OR OTHER FOREST PRODUCTS FROM ANY FOREST LAND APPLIES TO
PETITIONER.

II. WHETHER x x x POSSESSION OF THE NARRA TREE CUT IN PRIVATE LAND CONTESTED BY VICAR CALIX AND
PRIVATE-COMPLAINANT OSCAR TANSIONGCO IS COVERED BY SECTION 80 OF P.D. 705 AS AMENDED.

III. WHETHER PRIVATE-COMPLAINANT CAN INITIATE THE CHARGE EVEN WITHOUT THE STANDING
AUTHORITY COMING FROM THE INVESTIGATING FOREST OFFICER OF THE DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES AS MANDATED BY SECTION 80 OF P.D. 705 AS AMENDED.

[IV.] WHETHER x x x THE TRIAL COURT ERRED IN TAKING COGNIZANCE OF THE CASE FILED BY PRIVATE-
COMPLAINANT BECAUSE IT WAS NOT THE INVESTIGATING OFFICER AS REQUIRED BY SECTION 80 OF P.D. 705
AS AMENDED WHO MUST BE THE ONE TO INSTITUTE THE FILING OF THE SAME.[16]

In its Comment to the petition, the Office of the Solicitor General (OSG) countered that (1) the trial court acquired jurisdiction
over the case even though Tansiongco, and not a DENR forest officer, filed the complaint against petitioner and (2) petitioner is
liable for violation of Section 68 of PD 705, as amended.

The Issues

The petition raises the following issues:[17]

1) Whether the trial court acquired jurisdiction over Criminal Case No. 2207 even though it was based on a complaint filed by
Tansiongco and not by a DENR forest officer; and

2) Whether petitioner is liable for violation of Section 68 of PD 705, as amended.

The Ruling of the Court

The petition has no merit.


The Trial Court Acquired Jurisdiction Over

Criminal Case No. 2207

We sustain the OSGs claim that the trial court acquired jurisdiction over Criminal Case No. 2207. The Revised Rules of Criminal
Procedure (Revised Rules) list the cases which must be initiated by a complaint filed by specified individuals, [18] non-compliance
of which ousts the trial court of jurisdiction from trying such cases.[19] However, these cases concern only defamation and other
crimes against chastity[20] and not to cases concerning Section 68 of PD 705, as amended. Further, Section 80 of PD 705 does not
prohibit an interested person from filing a complaint before any qualified officer for violation of Section 68 of PD 705, as
amended. Section 80 of PD 705 provides in relevant parts:

SECTION 80. Arrest; Institution of criminal actions. x x x x

Reports and complaints regarding the commission of any of the offenses defined in this Chapter, not
committed in the presence of any forest officer or employee, or any of the deputized officers or officials, shall
immediately be investigated by the forest officer assigned in the area where the offense was allegedly
committed, who shall thereupon receive the evidence supporting the report or complaint.

If there is prima facie evidence to support the complaint or report, the investigating forest officer shall file
the necessary complaint with the appropriate official authorized by law to conduct a preliminary
investigation of criminal cases and file an information in Court. (Emphasis supplied)

We held in People v. CFI of Quezon[21] that the phrase reports and complaints in Section 80 refers to reports and
complaints as might be brought to the forest officer assigned to the area by other forest officers or employees of the Bureau of
Forest Development or any of the deputized officers or officials, for violations of forest laws not committed in their presence.[22]

Here, it was not forest officers or employees of the Bureau of Forest Development or any of the deputized officers or officials
who reported to Hernandez the tree-cutting in the Mayod Property but Tansiongco, a private citizen who claims ownership over
the Mayod Property. Thus, Hernandez cannot be faulted for not conducting an investigation to determine if there is prima facie
evidence to support the complaint or report.[23] At any rate, Tansiongco was not precluded, either under Section 80 of PD 705 or
the Revised Rules, from filing a complaint before the Provincial Prosecutor for petitioners alleged violation of Section 68 of PD
705, as amended. For its part, the trial court correctly took cognizance of Criminal Case No. 2207 as the case falls within its
exclusive original jurisdiction.[24]

Petitioner is Liable for Cutting Timber in Private

Property Without Permit

Section 68, as amended, one of the 12 acts[25] penalized under PD 705, provides:

SECTION 68. Cutting, Gathering and/or Collecting Timber, or Other Forest Products Without License.
Any person who shall cut, gather, collect, remove timber or other forest products from any forest land,
or timber from alienable or disposable public land, or from private land, without any authority, or possess
timber or other forest products without the legal documents as required under existing forest laws and
regulations, shall be punished with the penalties imposed under Articles 309 and 310 of the Revised Penal
Code: Provided, That in the case of partnerships, associations, or corporations, the officers who ordered the
cutting, gathering, collection or possession shall be liable, and if such officers are aliens, they shall, in addition
to the penalty, be deported without further proceedings on the part of the Commission on Immigration and
Deportation.

The court shall further order the confiscation in favor of the government of the timber or any forest
products cut, gathered, collected, removed, or possessed as well as the machinery, equipment, implements
and tools illegally used in the area where the timber or forest products are found. (Emphasis supplied)

Section 68 penalizes three categories of acts: (1) the cutting, gathering, collecting, or removing of timber or other forest
products from any forest land without any authority; (2) the cutting, gathering, collecting, or removing of timber from alienable
or disposable public land, or from private land without any authority;[26] and (3) the possession of timber or other forest products
without the legal documents as required under existing forest laws and regulations. [27] Petitioner stands charged of having cut,
gathered, collected and removed timber or other forest products from a private land[28] without x x x the necessary permit x x
x thus his liablity, if ever, should be limited only for cut[ting], gather[ing], collect[ing] and remov[ing] timber, under the second
category. Further, the prosecution evidence showed that petitioner did not perform any acts of gathering, collecting, or removing
but only the act of cutting a lone narra tree. Hence, this case hinges on the question of whether petitioner cut x x x timber in the
Mayod Property without a DENR permit.[29]

We answer in the affirmative and thus affirm the lower courts rulings.

On the question of whether petitioner cut a narra tree in the Mayod Property without a DENR permit, petitioner adopted
conflicting positions. Before his trial, petitioner consistently represented to the authorities that he cut a narra tree in the Mayod
Property and that he did so only with Calixs permission. However, when he testified, petitioner denied cutting the tree in
question. We sustain the lower courts rulings that petitioners extrajudicial admissions bind him. [30] Petitioner does not explain
why Royo and Hernandez, public officials who testified under oath in their official capacities, would lie on the stand to implicate
petitioner in a serious criminal offense, not to mention that the acts of these public officers enjoy the presumption ofregularity.
Further, petitioner does not deny presenting Calixs authorization to Royo and Hernandez as his basis for cutting the narra tree in
the Mayod Property. Petitioner has no use of Calixs authorization if, as he claimed during the trial, he did not cut any tree in the
Mayod Property.

We further hold that the lone narre tree petitioner cut from the Mayod Property constitutes timber under Section 68 of PD 705,
as amended. PD 705 does not define timber, only forest product (which circuitously includes timber.) [31] Does the narra tree in
question constitute timber under Section 68? The closest this Court came to defining the term timber in Section 68 was to provide
that timber, includes lumber or processed log.[32] In other jurisdictions, timber is determined by compliance with specified
dimensions[33] or certain stand age or rotation age.[34] In Mustang Lumber, Inc. v. Court of Appeals,[35] this Court was faced with a
similar task of having to define a term in Section 68 of PD 705 - lumber - to determine whether possession of lumber is punishable
under that provision. In ruling in the affirmative, we held that lumber should be taken in its ordinary or common usage meaning
to refer to processed log or timber, thus:

The Revised Forestry Code contains no definition of either timber or lumber. While the former is included in
forest products as defined in paragraph (q) of Section 3, the latter is found in paragraph (aa) of the same
section in the definition of Processing plant, which reads:

(aa) Processing plant is any mechanical set-up, machine or combination of machine used
for the processing of logs and other forest raw materials into lumber, veneer, plywood,
wallboard, blackboard, paper board, pulp, paper or other finished wood products.
This simply means that lumber is a processed log or processed forest raw material. Clearly, the Code uses the
term lumber in its ordinary or common usage. In the 1993 copyright edition of Websters Third New
International Dictionary, lumber is defined, inter alia, as timber or logs after being prepared for the market.
Simply put, lumber is a processed log or timber.

It is settled that in the absence of legislative intent to the contrary, words and phrases used in a statute
should be given their plain, ordinary, and common usage meaning. And in so far as possession
of timber without the required legal documents is concerned, Section 68 of PD No. 705, as amended, makes
no distinction between raw and procesed timber. Neither should we. [36] x x x x (Italicization in the original;
boldfacing supplied)

We see no reason why, as in Mustang, the term timber under Section 68 cannot be taken in its common acceptation as referring
to wood used for or suitable for building or for carpentry or joinery.[37] Indeed, tree saplings or tiny tree stems that are too small
for use as posts, panelling, beams, tables, or chairs cannot be considered timber. [38]

Here, petitioner was charged with having felled a narra tree and converted the same into several pieces of sawn lumber, about
three (3) pcs. 2x16x6 and three (3) pcs. 2x18x7 x x x consisting of 111 board feet x x x. These measurements were indicated in the
apprehension receipt Hernandez issued to petitioner on 26 January 1999 which the prosecution introduced in
evidence.[39] Further, Hernandez testified that the larger portion of the felled log left in the Mayod Property measured 76
something centimeters [at the big end] while the smaller end measured 65 centimeters and the length was 2.8
meters.[40] Undoubtedly, the narra tree petitioner felled and converted to lumber was timber fit for building or for carpentry or
joinery and thus falls under the ambit of Section 68 of PD 705, as amended.

The Penalty Imposable on Petitioner

Violation of Section 68 of PD 705, as amended, is punishable as Qualified Theft under Article 310 in relation to Article 309 of the
Revised Penal Code (RPC), thus:

Art. 310. Qualified theft. - The crime of qualified theft shall be punished by the penalties next higher by two
degrees than those respectively specified in the next preceding article x x x.

Art. 309. Penalties. - Any person guilty of theft shall be punished by:

1. The penalty of prisin mayor in its minimum and medium periods, if the value of the thing stolen is more
than 12,000 pesos but does not exceed 22,000 pesos; but if the value of the thing stolen exceeds the latter
amount, the penalty shall be the maximum period of the one prescribed in this paragraph, and one year for
each additional ten thousand pesos, but the total of the penalty which may be imposed shall not exceed
twenty years. In such cases, and in connection with the accessory penalties which may be imposed and for
the purpose of the other provisions of this Code, the penalty shall be termed prisin mayor or reclusin
temporal, as the case may be.

2. The penalty of prisin correccional in its medium and maximum periods, if the value of the thing stolen is
more than 6,000 pesos but does not exceed 12,000 pesos.
3. The penalty of prisin correccional in its minimum and medium periods, if the value of the property stolen
is more than 200 pesos but does not exceed 6,000 pesos.

4. Arresto mayor in its medium period to prisin correccional in its minimum period, if the value of the property
stolen is over 50 pesos but does not exceed 200 pesos.

5. Arresto mayor to its full extent, if such value is over 5 pesos but does not exceed 50 pesos.

6. Arresto mayor in its minimum and medium periods, if such value does not exceed 5 pesos.

7. Arresto menor or a fine not exceeding 200 pesos, if the theft is committed under the circumstances
enumerated in paragraph 3 of the next preceding article and the value of the thing stolen does not exceed 5
pesos. If such value exceeds said amount, the provisions of any of the five preceding subdivisions shall be
made applicable.

8. Arresto menor in its minimum period or a fine not exceeding 50 pesos, when the value of the thing stolen
is not over 5 pesos, and the offender shall have acted under the impulse of hunger, poverty, or the difficulty
of earning a livelihood for the support of himself or his family.

The Information filed against petitioner alleged that the six pieces of lumber measuring 111 board feet were valued at P3,330.
However, if the value of the log left at the Mayod Property is included, the amount increases to P20,930.40. To prove this
allegation, the prosecution relied on Hernandezs testimony that these amounts, as stated in the apprehension receipt he issued,
are his estimates based on prevailing local price.[41]

This evidence does not suffice. To prove the amount of the property taken for fixing the penalty imposable against the accused
under Article 309 of the RPC, the prosecution must present more than a mere uncorroborated estimate of such fact.[42] In the
absence of independent and reliable corroboration of such estimate, courts may either apply the minimum penalty under Article
309 or fix the value of the property taken based on the attendant circumstances of the case.[43] In People v. Dator[44]where, as
here, the accused was charged with violation of Section 68 of PD 705, as amended, for possession of lumber without permit, the
prosecutions evidence for the lumbers value consisted of an estimate made by the apprehending authorities whose apparent
lack of corroboration was compounded by the fact that the transmittal letter for the estimate was not presented in evidence.
Accordingly, we imposed on the accused the minimum penalty under Article 309(6)[45] of the RPC.[46]

Applying Dator in relation to Article 310 of the RPC and taking into account the Indeterminate Sentence Law, we find it proper to
impose on petitioner, under the circumstances obtaining here, the penalty of four (4) months and one (1) day of arresto mayor,
as minimum, to three (3) years, four (4) months and twenty-one (21) days of prision correcional, as maximum.

WHEREFORE, we AFFIRM the Decision dated 28 June 2002 and the Resolution dated 14 May 2003 of the Court of Appeals with
the modification that petitioner Sesinando Merida is sentenced to four (4) months and one (1) day of arresto mayor, as minimum,
to three (3) years, four (4) months and twenty-one (21) days of prision correcional, as maximum.

SO ORDERED.

ANTONIO T. CARPIO, Associate Justice


BENITO ASTORGA, petitioner, vs. PEOPLE OF THE PHILIPPINES, respondent.

YNARES-SANTIAGO, J.:

This is a petition for review under Rule 45 of the Rules of Court, seeking the reversal of a Decision of the
Sandiganbayan in Criminal Case No. 24986, dated July 5, 2001, [1] as well as its Resolutions dated September 28, 2001
and July 10, 2002.

On October 28, 1998, the Office of the Ombudsman filed the following Information against Benito Astorga, Mayor
of Daram, Samar, as well as a number of his men for Arbitrary Detention:

That on or about the 1st day of September, 1997, and for sometime subsequent thereto, at the Municipality of Daram,
Province of Samar, Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, a
public officer, being the Municipal Mayor of Daram, Samar, in such capacity and committing the offense in relation to
office, conniving, confederating and mutually helping with unidentified persons, who are herein referred to under
fictitious names JOHN DOES, who were armed with firearms of different calibers, with deliberate intent, did then and
there willfully, unlawfully and feloniously detain Elpidio Simon, Moises dela Cruz, Wenifredo Maniscan, Renato
Militante and Crisanto Pelias, DENR Employees, at the Municipality of Daram, by not allowing them to leave the
place, without any legal and valid grounds thereby restraining and depriving them of their personal liberty for nine (9)
hours, but without exceeding three (3) days.

CONTRARY TO LAW.[2]

On September 1, 1997, Regional Special Operations Group (RSOG) of the Department of Environment and
Natural Resources (DENR) Office No. 8, Tacloban City sent a team to the island of Daram, Western Samar to conduct
intelligence gathering and forest protection operations in line with the governments campaign against illegal
logging. The team was composed of Forester II Moises dela Cruz, Scaler Wenifredo Maniscan, Forest Ranger Renato
Militante, and Tree Marker Crisanto Pelias, with Elpidio E. Simon, Chief of the Forest Protection and Law Enforcement
Section, as team leader. The team was escorted by SPO3 Andres B. Cinco, Jr. and SPO1 Rufo Capoquian. [3]

The team stopped at Brgy. Bagacay, Daram, Western Samar at 2:00 p.m., where they saw two yacht-like boats
being constructed. After consulting with the local barangay officials, the team learned that the boats belonged to a
certain Michael Figueroa. However, since Figueroa was not around at the time, the team left Brgy. Bagacay. [4]

En route to Brgy. Manungca, Sta. Rita, Samar, the team spotted two more boats being constructed in the vicinity
of Brgy. Lucob-Lucob, Daram, Samar, between 4:30-5:00 p.m., prompting them to stop and investigate. Thus,
Maniscan and Militante disembarked from the DENRs service pump boat and proceeded to the site of the boat
construction. There, they met Mayor Astorga. After conversing with the mayor, Militante returned to their boat for the
purpose of fetching Simon, at the request of Mayor Astorga. [5]

When Simon, accompanied by dela Cruz, SPO3 Cinco, and SPO1 Capoquian, approached Mayor Astorga to try
and explain the purpose of their mission, Simon was suddenly slapped hard twice on the shoulder by Mayor Astorga,
who exclaimed, Puwede ko kamo papaglanguyon pag-uli ha Tacloban. Ano, di ka maaram nga natupa ako? Natupa
baya ako. Diri kamo makauli yana kay puwede kame e charge ha misencounter. (I can make you swim back to
Tacloban. Dont you know that I can box? I can box. Dont you know that I can declare this a misencounter?) [6] Mayor
Astorga then ordered someone to fetch reinforcements, and forty-five (45) minutes later, or between 5:00-6:00 p.m.,
a banca arrived bearing ten (10) men, some of them dressed in fatigue uniforms. The men were armed with M-16 and
M14 rifles, and they promptly surrounded the team, guns pointed at the team members. [7] At this, Simon tried to explain
to Astorga the purpose of his teams mission.[8] He then took out his handheld ICOM radio, saying that he was going to
contact his people at the DENR in Catbalogan to inform them of the teams whereabouts. Suddenly, Mayor Astorga
forcibly grabbed Simons radio, saying, Maupay nga waray kamo radio bis diri somabut an iyo opisina kon hain kamo,
bis diri kamo maka aro hin bulig. (Its better if you have no radio so that your office would not know your whereabouts
and so that you cannot ask for help). [9] Mayor Astorga again slapped the right shoulder of Simon, adding, Kong siga
kamo ha Leyte ayaw pagdad-a dinhi ha Samar kay diri kamo puwede ha akon. (If you are tough guys in Leyte, do not
bring it to Samar because I will not tolerate it here.)[10] Simon then asked Mayor Astorga to allow the team to go home,
at which Mayor Astorga retorted that they would not be allowed to go home and that they would instead be brought to
Daram.[11] Mayor Astorga then addressed the team, saying, Kon magdakop man la kamo, unahon an mga dagko. Kon
madakop niyo an mga dagko, an kan Figueroa dida ha Bagacay puwede ko liwat ipadakop an akon. (If you really want
to confiscate anything, you start with the big-time. If you confiscate the boats of Figueroa at Brgy. Bagacay, I will
surrender mine.)[12] Simon then tried to reiterate his request for permission to leave, which just succeeded in irking
Mayor Astorga, who angrily said, Diri kamo maka uli yana kay dad on ko kamo ha Daram, para didto kita mag uro
istorya. (You cannot go home now because I will bring you to Daram. We will have many things to discuss there.)[13]

The team was brought to a house where they were told that they would be served dinner. The team had dinner
with Mayor Astorga and several others at a long table, and the meal lasted between 7:00-8:00 p.m.[14] After dinner,
Militante, Maniscan and SPO1 Capoquian were allowed to go down from the house, but not to leave
the barangay.[15] On the other hand, SPO3 Cinco and the rest just sat in the house until 2:00 a.m. when the team was
finally allowed to leave.[16]

Complainants filed a criminal complaint for arbitrary detention against Mayor Astorga and his men, which led to
the filing of the above-quoted Information.

Mayor Astorga was subsequently arraigned on July 3, 2000, wherein he pleaded not guilty to the offenses
charged.[17] At the trial, the prosecution presented the testimonies of SPO1 Capoquian and SPO3 Cinco, as well as
their Joint Affidavit.[18] However, the presentation of Simons testimony was not completed, and none of his fellow team
members came forward to testify. Instead, the members of the team sent by the DENR RSOG executed a Joint Affidavit
of Desistance.[19]

On July 5, 2001, the Sandiganbayan promulgated its Decision, disposing of the case as follows:

WHEREFORE, premises considered, judgment is hereby rendered finding accused BENITO ASTORGA Y
BOCATCAT guilty of Arbitrary Detention, and in the absence of any mitigating or aggravating circumstances,
applying the Indeterminate Sentence Law, he is hereby sentenced to suffer imprisonment of four (4) months
of arresto mayor as minimum to one (1) year and eight (8) months of prision correctional as maximum.

SO ORDERED.[20]

The accused filed a Motion for Reconsideration dated July 11, 2001[21] which was denied by the Sandiganabayan
in a Resolution dated September 28, 2001.[22] A Second Motion for Reconsideration dated October 24, 2001 [23] was
also filed, and this was similarly denied in a Resolution dated July 10, 2002. [24]

Hence, the present petition, wherein the petitioner assigns a sole error for review:

5.1. The trial court grievously erred in finding the accused guilty of Arbitrary Detention as defined and penalized under
Article 124 of the Revised Penal Code, based on mere speculations, surmises and conjectures and, worse,
notwithstanding the Affidavit of Desistance executed by the five (5) complaining witnesses wherein the latter
categorically declared petitioners innocence of the crime charged. [25]

Petitioner contends that the prosecution failed to establish the required quantum of evidence to prove the guilt of
the accused,[26] especially in light of the fact that the private complainants executed a Joint Affidavit of
Desistance.[27] Petitioner asserts that nowhere in the records of the case is there any competent evidence that could
sufficiently establish the fact that restraint was employed upon the persons of the team members. [28] Furthermore, he
claims that the mere presence of armed men at the scene does not qualify as competent evidence to prove that fear
was in fact instilled in the minds of the team members, to the extent that they would feel compelled to stay in Brgy.
Lucob-Lucob.[29]

Arbitrary Detention is committed by any public officer or employee who, without legal grounds, detains a
person.[30] The elements of the crime are:

1. That the offender is a public officer or employee.

2. That he detains a person.

3. That the detention is without legal grounds.[31]

That petitioner, at the time he committed the acts assailed herein, was then Mayor of Daram, Samar is not
disputed. Hence, the first element of Arbitrary Detention, that the offender is a public officer or employee, is undeniably
present.
Also, the records are bereft of any allegation on the part of petitioner that his acts were spurred by some legal
purpose. On the contrary, he admitted that his acts were motivated by his instinct for self-preservation and the feeling
that he was being singled out.[32]The detention was thus without legal grounds, thereby satisfying the third element
enumerated above.

What remains is the determination of whether or not the team was actually detained.

In the case of People v. Acosta,[33] which involved the illegal detention of a child, we found the accused-appellant
therein guilty of kidnapping despite the lack of evidence to show that any physical restraint was employed upon the
victim. However, because the victim was a boy of tender age and he was warned not to leave until his godmother, the
accused-appellant, had returned, he was practically a captive in the sense that he could not leave because of his fear to
violate such instruction.[34]

In the case of People v. Cortez,[35] we held that, in establishing the intent to deprive the victim of his liberty, it is
not necessary that the offended party be kept within an enclosure to restrict her freedom of locomotion. At the time of
her rescue, the offended party in said case was found outside talking to the owner of the house where she had been
taken. She explained that she did not attempt to leave the premises for fear that the kidnappers would make good their
threats to kill her should she do so. We ruled therein that her fear was not baseless as the kidnappers knew where she
resided and they had earlier announced that their intention in looking for her cousin was to kill him on sight. Thus, we
concluded that fear has been known to render people immobile and that appeals to the fears of an individual, such as
by threats to kill or similar threats, are equivalent to the use of actual force or violence. [36]

The prevailing jurisprudence on kidnapping and illegal detention is that the curtailment of the victims liberty need
not involve any physical restraint upon the victims person. If the acts and actuations of the accused can produce such
fear in the mind of the victim sufficient to paralyze the latter, to the extent that the victim is compelled to limit his own
actions and movements in accordance with the wishes of the accused, then the victim is, for all intents and purposes,
detained against his will.

In the case at bar, the restraint resulting from fear is evident. Inspite of their pleas, the witnesses and the
complainants were not allowed by petitioner to go home.[37] This refusal was quickly followed by the call for and arrival
of almost a dozen reinforcements, all armed with military-issue rifles, who proceeded to encircle the team, weapons
pointed at the complainants and the witnesses.[38] Given such circumstances, we give credence to SPO1 Capoquians
statement that it was not safe to refuse Mayor Astorgas orders. [39] It was not just the presence of the armed men, but
also the evident effect these gunmen had on the actions of the team which proves that fear was indeed instilled in the
minds of the team members, to the extent that they felt compelled to stay in Brgy. Lucob-Lucob. The intent to prevent
the departure of the complainants and witnesses against their will is thus clear.

Regarding the Joint Affidavit of Desistance executed by the private complainants, suffice it to say that the
principles governing the use of such instruments in the adjudication of other crimes can be applied here. Thus,
in People v. Ballabare, it was held that an affidavit of desistance is merely an additional ground to buttress the defenses
of the accused, not the sole consideration that can result in acquittal. There must be other circumstances which, when
coupled with the retraction or desistance, create doubts as to the truth of the testimony given by the witnesses at the
trial and accepted by the judge. Here, there are no such circumstances.[40] Indeed, the belated claims made in the Joint
Affidavit of Desistance, such as the allegations that the incident was the result of a misunderstanding and that the team
acceded to Mayor Astorgas orders out of respect, are belied by petitioners own admissions to the contrary. [41] The Joint
Affidavit of Desistance of the private complainants is evidently not a clear repudiation of the material points alleged in
the information and proven at the trial, but a mere expression of the lack of interest of private complainants to pursue
the case. This conclusion is supported by one of its latter paragraphs, which reads:

11. That this affidavit was executed by us if only to prove our sincerity and improving DENR relations with
the local Chiefs Executive and other official of Daram, Islands so that DENR programs and project
can be effectively implemented through the support of the local officials for the betterment of the
residence living conditions who are facing difficulties and are much dependent on government
support.[42]

Petitioner also assails the weight given by the trial court to the evidence, pointing out that the Sandiganbayans
reliance on the testimony of SPO1 Capoquian is misplaced, for the reason that SPO1 Capoquian is not one of the
private complainants in the case.[43]He also makes much of the fact that prosecution witness SPO1 Capoquian was
allegedly not exactly privy to, and knowledgeable of, what exactly transpired between herein accused and the DENR
team leader Mr. Elpidio E. Simon, from their alleged confrontation, until they left Barangay Lucob-Lucob in the early
morning of 2 September 1997.[44]
It is a time-honored doctrine that the trial courts factual findings are conclusive and binding upon appellate courts
unless some facts or circumstances of weight and substance have been overlooked, misapprehended or
misinterpreted.[45] Nothing in the case at bar prompts us to deviate from this doctrine. Indeed, the fact that SPO1
Capoquian is not one of the private complainants is completely irrelevant. Neither penal law nor the rules of evidence
requires damning testimony to be exclusively supplied by the private complainants in cases of Arbitrary
Detention. Furthermore, Mayor Astorgas claim that SPO1 Capoquian was not exactly privy to what transpired between
Simon and himself is belied by the evidence. SPO1 Capoquian testified that he accompanied Simon when the latter
went to talk to petitioner.[46] He heard all of Mayor Astorgas threatening remarks.[47] He was with Simon when they were
encircled by the men dressed in fatigues and wielding M-16 and M-14 rifles.[48] In sum, SPO1 Capoquian witnessed all
the circumstances which led to the Arbitrary Detention of the team at the hands of Mayor Astorga.

Petitioner submits that it is unclear whether the team was in fact prevented from leaving Brgy. Lucob-Lucob or
whether they had simply decided to while away the time and take advantage of the purported hospitality of the
accused.[49] On the contrary, SPO3 Cinco clearly and categorically denied that they were simply whiling away the time
between their dinner with Mayor Astorga and their departure early the following morning. [50] SPO1 Capoquian gave
similar testimony, saying that they did not use the time between their dinner with Mayor Astorga and their departure
early the following morning to enjoy the place and that, given a choice, they would have gone home. [51]

Petitioner argues that he was denied the cold neutrality of an impartial judge, because the ponente of the assailed
decision acted both as magistrate and advocate when he propounded very extensive clarificatory questions on the
witnesses. Surely, the Sandiganbayan, as a trial court, is not an idle arbiter during a trial. It can propound clarificatory
questions to witnesses in order to ferret out the truth. The impartiality of the court cannot be assailed on the ground
that clarificatory questions were asked during the trial. [52]

Thus, we affirm the judgment of the Sandiganbayan finding petitioner guilty beyond reasonable doubt of Arbitrary
Detention. Article 124 (1) of the Revised Penal Code provides that, where the detention has not exceeded three days,
the penalty shall be arresto mayor in its maximum period to prision correccional in its minimum period, which has a
range of four (4) months and one (1) day to two (2) years and four (4) months. Applying the Indeterminate Sentence
Law, petitioner is entitled to a minimum term to be taken from the penalty next lower in degree, or arresto mayor in its
minimum and medium periods, which has a range of one (1) month and one (1) day to four (4) months. Hence, the
Sandiganbayan was correct in imposing the indeterminate penalty of four (4) months of arresto mayor, as minimum, to
one (1) year and eight (8) months of prision correccional, as maximum.

Before closing, it may not be amiss to quote the words of Justice Perfecto in his concurring opinion in Lino v.
Fugoso, wherein he decried the impunity enjoyed by public officials in committing arbitrary or illegal detention, and
called for the intensification of efforts towards bringing them to justice:

The provisions of law punishing arbitrary or illegal detention committed by government officers form part of our statute
books even before the advent of American sovereignty in our country. Those provisions were already in effect during
the Spanish regime; they remained in effect under American rule; continued in effect under the Commonwealth. Even
under the Japanese regime they were not repealed. The same provisions continue in the statute books of the free
and sovereign Republic of the Philippines. This notwithstanding, and the complaints often heard of violations of said
provisions, it is very seldom that prosecutions under them have been instituted due to the fact that the erring
individuals happened to belong to the same government to which the prosecuting officers belong. It is high time that
every one must do his duty, without fear or favor, and that prosecuting officers should not answer with cold shrugging
of the shoulders the complaints of the victims of arbitrary or illegal detention.

Only by an earnest enforcement of the provisions of articles 124 and 125 of the Revised Penal Code will it be
possible to reduce to its minimum such wanton trampling of personal freedom as depicted in this case. The
responsible officials should be prosecuted, without prejudice to the detainees right to the indemnity to which they may
be entitled for the unjustified violation of their fundamental rights. [53]

WHEREFORE, in view of the foregoing, the petition is hereby DENIED. The Decision of the Sandiganbayan in
Criminal Case No. 24986, dated July 5, 2001 finding petitioner BENITO ASTORGA guilty beyond reasonable doubt of
the crime of Arbitrary Detention and sentencing him to suffer the indeterminate penalty of four (4) months of arresto
mayor, as minimum, to one (1) year and eight (8) months of prision correccional, as maximum, is AFFIRMED in toto.
Costs de oficio.

SO ORDERED.

Davide, Jr., C.J., (Chairman), Vitug, and Carpio, JJ., concur. Azcuna, J., on leave.
LEONARDO A. PAAT, in his capacity as Officer-in-Charge (OIC), Regional Executive Director (RED), Region 2
and JOVITO LAYUGAN, JR., in his capacity as Community Environment and Natural Resources Officer
(CENRO), both of the Department of Environment and Natural Resources (DENR), petitioners, vs.
COURT OF APPEALS, HON. RICARDO A. BACULI in his capacity as Presiding Judge of Branch 2,
Regional Trial Court at Tuguegarao, Cagayan, and SPOUSES BIENVENIDO and VICTORIA DE
GUZMAN, respondents.

DECISION
TORRES, JR., J.:

Without violating the principle of exhaustion of administrative remedies, may an action for replevin prosper to
recover a movable property which is the subject matter of an administrative forfeiture proceeding in the Department of
Environment and Natural Resources pursuant to Section 68-A of P. D. 705, as amended, entitled The Revised Forestry
Code of the Philippines?
Are the Secretary of DENR and his representatives empowered to confiscate and forfeit conveyances used in
transporting illegal forest products in favor of the government?
These are two fundamental questions presented before us for our resolution.
The controversy on hand had its incipiency on May 19, 1989 when the truck of private respondent Victoria de
Guzman while on its way to Bulacan from San Jose, Baggao, Cagayan, was seized by the Department of Environment
and Natural Resources (DENR, for brevity) personnel in Aritao, Nueva Vizcaya because the driver could not produce
the required documents for the forest products found concealed in the truck. Petitioner Jovito Layugan, the Community
Environment and Natural Resources Officer (CENRO) in Aritao, Cagayan, issued on May 23, 1989 an order of
confiscation of the truck and gave the owner thereof fifteen (15) days within which to submit an explanation why the
truck should not be forfeited. Private respondents, however, failed to submit the required explanation. On June 22,
1989,[1] Regional Executive Director Rogelio Baggayan of DENR sustained petitioner Layugans action of confiscation
and ordered the forfeiture of the truck invoking Section 68-A of Presidential Decree No. 705 as amended by Executive
Order No. 277. Private respondents filed a letter of reconsideration dated June 28, 1989 of the June 22, 1989 order of
Executive Director Baggayan, which was, however, denied in a subsequent order of July 12, 1989. [2] Subsequently, the
case was brought by the petitioners to the Secretary of DENR pursuant to private respondents statement in their letter
dated June 28, 1989 that in case their letter for reconsideration would be denied then this letter should be considered
as an appeal to the Secretary.[3] Pending resolution however of the appeal, a suit for replevin, docketed as Civil Case
4031, was filed by the private respondents against petitioner Layugan and Executive Director Baggayan [4] with the
Regional Trial Court, Branch 2 of Cagayan,[5] which issued a writ ordering the return of the truck to private
respondents.[6] Petitioner Layugan and Executive Director Baggayan filed a motion to dismiss with the trial court
contending, inter alia, that private respondents had no cause of action for their failure to exhaust administrative
remedies. The trial court denied the motion to dismiss in an order dated December 28, 1989. [7] Their motion for
reconsideration having been likewise denied, a petition for certiorari was filed by the petitioners with the respondent
Court of Appeals which sustained the trial courts order ruling that the question involved is purely a legal
question.[8] Hence, this present petition,[9] with prayer for temporary restraining order and/or preliminary injunction,
seeking to reverse the decision of the respondent Court of Appeals was filed by the petitioners on September 9,
1993. By virtue of the Resolution dated September 27, 1993, [10] the prayer for the issuance of temporary restraining
order of petitioners was granted by this Court.
Invoking the doctrine of exhaustion of administrative remedies, petitioners aver that the trial court could not legally
entertain the suit for replevin because the truck was under administrative seizure proceedings pursuant to Section 68-
A of P.D. 705, as amended by E.O. 277. Private respondents, on the other hand, would seek to avoid the operation of
this principle asserting that the instant case falls within the exception of the doctrine upon the justification that (1) due
process was violated because they were not given the chance to be heard, and (2) the seizure and forfeiture was
unlawful on the grounds: (a) that the Secretary of DENR and his representatives have no authority to confiscate and
forfeit conveyances utilized in transporting illegal forest products, and (b) that the truck as admitted by petitioners was
not used in the commission of the crime.
Upon a thorough and delicate scrutiny of the records and relevant jurisprudence on the matter, we are of the
opinion that the plea of petitioners for reversal is in order.
This Court in a long line of cases has consistently held that before a party is allowed to seek the intervention of
the court, it is a pre-condition that he should have availed of all the means of administrative processes afforded
him. Hence, if a remedy within the administrative machinery can still be resorted to by giving the administrative officer
concerned every opportunity to decide on a matter that comes within his jurisdiction then such remedy should be
exhausted first before courts judicial power can be sought. The premature invocation of courts intervention is fatal to
ones cause of action.[11] Accordingly, absent any finding of waiver or estoppel the case is susceptible of dismissal for
lack of cause of action.[12] This doctrine of exhaustion of administrative remedies was not without its practical and legal
reasons, for one thing, availment of administrative remedy entails lesser expenses and provides for a speedier
disposition of controversies. It is no less true to state that the courts of justice for reasons of comity and convenience
will shy away from a dispute until the system of administrative redress has been completed and complied with so as to
give the administrative agency concerned every opportunity to correct its error and to dispose of the case. However,
we are not amiss to reiterate that the principle of exhaustion of administrative remedies as tested by a battery of cases
is not an ironclad rule. This doctrine is a relative one and its flexibility is called upon by the peculiarity and uniqueness
of the factual and circumstantial settings of a case. Hence, it is disregarded (1) when there is a violation of due
process,[13] (2) when the issue involved is purely a legal question, [14] (3) when the administrative action is patently illegal
amounting to lack or excess of jurisdiction,[15] (4) when there is estoppel on the part of the administrative agency
concerned,[16] (5) when there is irreparable injury,[17] (6) when the respondent is a department secretary whose acts as
an alter ego of the President bears the implied and assumed approval of the latter, [18] (7) when to require exhaustion
of administrative remedies would be unreasonable,[19] (8) when it would amount to a nullification of a claim, [20] (9) when
the subject matter is a private land in land case proceedings, [21] (10) when the rule does not provide a plain, speedy
and adequate remedy, and (11) when there are circumstances indicating the urgency of judicial intervention. [22]
In the case at bar, there is no question that the controversy was pending before the Secretary of DENR when it
was forwarded to him following the denial by the petitioners of the motion for reconsideration of private respondents
through the order of July 12, 1989.In their letter of reconsideration dated June 28, 1989,[23] private respondents clearly
recognize the presence of an administrative forum to which they seek to avail, as they did avail, in the resolution of
their case. The letter, reads, thus:

xxx

If this motion for reconsideration does not merit your favorable action, then this letter should be considered as an appeal to the
Secretary.[24]

It was easy to perceive then that the private respondents looked up to the Secretary for the review and
disposition of their case. By appealing to him, they acknowledged the existence of an adequate and plain remedy still
available and open to them in the ordinary course of the law. Thus, they cannot now, without violating the principle of
exhaustion of administrative remedies, seek courts intervention by filing an action for replevin for the grant of their relief
during the pendency of an administrative proceedings.
Moreover, it is important to point out that the enforcement of forestry laws, rules and regulations and the protection,
development and management of forest lands fall within the primary and special responsibilities of the Department of
Environment and Natural Resources. By the very nature of its function, the DENR should be given a free hand
unperturbed by judicial intrusion to determine a controversy which is well within its jurisdiction. The assumption by the
trial court, therefore, of the replevin suit filed by private respondents constitutes an unjustified encroachment into the
domain of the administrative agencys prerogative. The doctrine of primary jurisdiction does not warrant a court to
arrogate unto itself the authority to resolve a controversy the jurisdiction over which is initially lodged with an
administrative body of special competence.[25] In Felipe Ismael, Jr. and Co. vs. Deputy Executive Secretary, [26] which
was reiterated in the recent case of Concerned Officials of MWSS vs. Vasquez, [27] this Court held:

Thus, while the administration grapples with the complex and multifarious problems caused by unbriddled exploitation of these
resources, the judiciary will stand clear. A long line of cases establish the basic rule that the courts will not interfere in matters
which are addressed to the sound discretion of government agencies entrusted with the regulation of activities coming under the
special technical knowledge and training of such agencies.

To sustain the claim of private respondents would in effect bring the instant controversy beyond the pale of the
principle of exhaustion of administrative remedies and fall within the ambit of excepted cases heretofore
stated. However, considering the circumstances prevailing in this case, we can not but rule out these assertions of
private respondents to be without merit. First, they argued that there was violation of due process because they did not
receive the May 23, 1989 order of confiscation of petitioner Layugan. This contention has no leg to stand on. Due
process does not necessarily mean or require a hearing, but simply an opportunity or right to be heard. [28] One may be
heard , not solely by verbal presentation but also, and perhaps many times more creditably and practicable than oral
argument, through pleadings.[29] In administrative proceedings moreover, technical rules of procedure and evidence
are not strictly applied; administrative process cannot be fully equated with due process in its strict judicial
sense.[30] Indeed, deprivation of due process cannot be successfully invoked where a party was given the chance to be
heard on his motion for reconsideration,[31] as in the instant case, when private respondents were undisputedly given
the opportunity to present their side when they filed a letter of reconsideration dated June 28, 1989 which was, however,
denied in an order of July 12, 1989 of Executive Director Baggayan. In Navarro III vs. Damasco, [32] we ruled that :

The essence of due process is simply an opportunity to be heard, or as applied to administrative proceedings, an opportunity to
explain ones side or an opportunity to seek a reconsideration of the action or ruling complained of. A formal or trial type hearing
is not at all times and in all instances essential. The requirements are satisfied when the parties are afforded fair and reasonable
opportunity to explain their side of the controversy at hand. What is frowned upon is the absolute lack of notice or hearing.

Second, private respondents imputed the patent illegality of seizure and forfeiture of the truck because the
administrative officers of the DENR allegedly have no power to perform these acts under the law. They insisted that
only the court is authorized to confiscate and forfeit conveyances used in transporting illegal forest products as can be
gleaned from the second paragraph of Section 68 of P.D. 705, as amended by E.O. 277. The pertinent provision reads
as follows:

SECTION 68. xxx

xxx

The court shall further order the confiscation in favor of the government of the timber or any forest products cut, gathered,
collected, removed, or possessed, as well as the machinery, equipments, implements and tools illegaly [sic] used in the area
where the timber or forest products are found. (Underline ours)

A reading, however, of the law persuades us not to go along with private respondents thinking not only because
the aforequoted provision apparently does not mention nor include conveyances that can be the subject of confiscation
by the courts, but to a large extent, due to the fact that private respondents interpretation of the subject provision unduly
restricts the clear intention of the law and inevitably reduces the other provision of Section 68-A , which is quoted herein
below:

SECTION 68-A. Administrative Authority of the Department or His Duly Authorized Representative To Order Confiscation. In
all cases of violation of this Code or other forest laws, rules and regulations, the Department Head or his duly authorized
representative, may order the confiscation of any forest products illegally cut, gathered, removed, or possessed or abandoned,
and all conveyances used either by land, water or air in the commission of the offense and to dispose of the same in accordance
with pertinent laws, regulations and policies on the matter. (Underline ours)

It is, thus, clear from the foregoing provision that the Secretary and his duly authorized representatives are given
the authority to confiscate and forfeit any conveyances utilized in violating the Code or other forest laws, rules and
regulations. The phrase to dispose of the same is broad enough to cover the act of forfeiting conveyances in favor of
the government. The only limitation is that it should be made in accordance with pertinent laws, regulations or policies
on the matter. In the construction of statutes, it must be read in such a way as to give effect to the purpose projected
in the statute.[33] Statutes should be construed in the light of the object to be achieved and the evil or mischief to be
suppressed, and they should be given such construction as will advance the object, suppress the mischief, and secure
the benefits intended.[34] In this wise, the observation of the Solicitor General is significant, thus:

But precisely because of the need to make forestry laws more responsive to present situations and realities and in view of the
urgency to conserve the remaining resources of the country, that the government opted to add Section 68-A. This amendatory
provision is an administrative remedytotally separate and distinct from criminal proceedings. More than anything else, it is
intended to supplant the inadequacies that characterize enforcement of forestry laws through criminal actions. The preamble of
EO 277-the law that added Section 68-A to PD 705-is most revealing:

WHEREAS, there is an urgency to conserve the remaining forest resources of the country for the benefit and welfare of the
present and future generations of Filipinos;

WHEREAS, our forest resources may be effectively conserved and protected through the vigilant enforcement and
implementation of our forestry laws, rules and regulations;

WHEREAS, the implementation of our forestry laws suffers from technical difficulties, due to certain inadequacies in the penal
provisions of the Revised Forestry Code of the Philippines; and
WHEREAS, to overcome this difficulties, there is a need to penalize certain acts more responsive to present situations and
realities;

It is interesting to note that Section 68-A is a new provision authorizing the DENR to confiscate, not only conveyances, but forest
products as well. On the other hand, confiscation of forest products by the court in a criminal action has long been provided for in
Section 68. If as private respondents insist, the power on confiscation cannot be exercised except only through the court under
Section 68, then Section 68-A would have no purpose at all. Simply put, Section 68-A would not have provided any solution to
the problem perceived in EO 277, supra.[35]

Private respondents, likewise, contend that the seizure was illegal because the petitioners themselves admitted
in the Order dated July 12, 1989 of Executive Director Baggayan that the truck of private respondents was not used in
the commission of the crime. This order, a copy of which was given to and received by the counsel of private
respondents, reads in part , viz. :

xxx while it is true that the truck of your client was not used by her in the commission of the crime, we uphold your claim that the
truck owner is not liable for the crime and in no case could a criminal case be filed against her as provided under Article 309 and
310 of the Revised Penal Code. xxx[36]

We observed that private respondents misread the content of the aforestated order and obviously misinterpreted
the intention of petitioners. What is contemplated by the petitioners when they stated that the truck "was not used in
the commission of the crime" is that it was not used in the commission of the crime of theft, hence, in no case can a
criminal action be filed against the owner thereof for violation of Article 309 and 310 of the Revised Penal Code.
Petitioners did not eliminate the possibility that the truck was being used in the commission of another crime, that is,
the breach of Section 68 of P.D.705 as amended by E.O. 277. In the same order of July 12, 1989, petitioners pointed
out:

xxx However, under Section 68 of P.D.705 as amended and further amended by Executive Order No.277 specifically provides
for the confiscation of the conveyance used in the transport of forest products not covered by the required legal documents. She
may not have been involved in the cutting and gathering of the product in question but the fact that she accepted the goods for a
fee or fare the same is therefor liable. xxx[37]

Private respondents, however, contended that there is no crime defined and punishable under Section 68 other
than qualified theft, so that, when petitioners admitted in the July 12, 1989 order that private respondents could not be
charged for theft as provided for under Articles 309 and 310 of the Revised Penal Code, then necessarily private
respondents could not have committed an act constituting a crime under Section 68. We disagree. For clarity, the
provision of Section 68 of P.D. 705 before its amendment by E.O. 277 and the provision of Section 1 of E.O. No.277
amending the aforementioned Section 68 are reproduced herein, thus:

SECTION 68. Cutting, gathering and/or collecting timber or other products without license. - Any person who shall cut , gather ,
collect , or remove timber or other forest products from any forest land, or timber from alienable and disposable public lands, or
from private lands, without any authority under a license agreement, lease, license or permit, shall be guilty of qualified theft as
defined and punished under Articles 309 and 310 of the Revised Penal Code xxx. (Underscoring ours; Section 68, P.D.705 before
its amendment by E.O.277 )

SECTION 1. Section 68 of Presidential Decree No.705, as amended, is hereby amended to read as follows:

Section 68. Cutting, gathering and/or collecting timber or other forest products without license. -Any person who shall cut,
gather, collect, remove timber or other forest products from any forest land, or timber from alienable or disposable public land, or
from private land, without any authority, or possess timber or other forest products without the legal documents as required under
existing forest laws and regulations, shall be punished with the penalties imposed under Articles 309 and 310 of the Revised
Penal Code xxx." (Underscoring ours; Section 1, E.O No. 277 amending Section 68, P.D. 705 as amended)

With the introduction of Executive Order No. 277 amending Section 68 of P.D. 705, the act of cutting, gathering,
collecting, removing, or possessing forest products without authority constitutes a distinct offense independent now
from the crime of theft under Articles 309 and 310 of the Revised Penal Code, but the penalty to be imposed is that
provided for under Article 309 and 310 of the Revised Penal Code. This is clear from the language of Executive Order
No. 277 when it eliminated the phrase shall be guilty of qualified theft as defined and punished under Articles 309 and
310 of the Revised Penal Code and inserted the words shall be punished with the penalties imposed under Article 309
and 310 of the Revised Penal Code . When the statute is clear and explicit, there is hardly room for any extended court
ratiocination or rationalization of the law.[38]
From the foregoing disquisition, it is clear that a suit for replevin can not be sustained against the petitioners for
the subject truck taken and retained by them for administrative forfeiture proceedings in pursuant to Section 68-A of
the P. D. 705, as amended. Dismissal of the replevin suit for lack of cause of action in view of the private respondents
failure to exhaust administrative remedies should have been the proper course of action by the lower court instead of
assuming jurisdiction over the case and consequently issuing the writ ordering the return of the truck. Exhaustion of
the remedies in the administrative forum, being a condition precedent prior to ones recourse to the courts and more
importantly, being an element of private respondents right of action, is too significant to be waylaid by the lower court.
It is worth stressing at this point, that a suit for replevin is founded solely on the claim that the defendant wrongfully
withholds the property sought to be recovered. It lies to recover possession of personal chattels that are unlawfully
detained.[39] To detain is defined as to mean to hold or keep in custody, [40] and it has been held that there is tortuous
taking whenever there is an unlawful meddling with the property, or an exercise or claim of dominion over it, without
any pretense of authority or right; this, without manual seizing of the property is sufficient.[41] Under the Rules of Court,
it is indispensable in replevin proceedings, that the plaintiff must show by his own affidavit that he is entitled to the
possession of property, that the property is wrongfully detained by the defendant, alleging the cause of detention, that
the same has not been taken for tax assessment, or seized under execution, or attachment, or if so seized, that it is
exempt from such seizure, and the actual value of the property. [42] Private respondents miserably failed to convince
this Court that a wrongful detention of the subject truck obtains in the instant case. It should be noted that the truck was
seized by the petitioners because it was transporting forest products with out the required permit of the DENR in
manifest contravention of Section 68 of P.D. 705 as amended by E.O 277. Section 68-A of P.D. 705, as amended,
unquestionably warrants the confiscation as well as the disposition by the Secretary of DENR or his duly authorized
representatives of the conveyances used in violating the provision of forestry laws. Evidently, the continued possession
or detention of the truck by the petitioners for administrative forfeiture proceeding is legally permissible, hence , no
wrongful detention exists in the case at bar.
Moreover, the suit for replevin is never intended as a procedural tool to question the orders of confiscation and
forfeiture issued by the DENR in pursuance to the authority given under P.D.705, as amended. Section 8 of the said
law is explicit that actions taken by the Director of the Bureau of Forest Development concerning the enforcement of
the provisions of the said law are subject to review by the Secretary of DENR and that courts may not review the
decisions of the Secretary except through a special civil action for certiorari or prohibition. It reads :

SECTION 8 . REVIEW - All actions and decisions of the Director are subject to review, motu propio or upon appeal of any
person aggrieved thereby, by the Department Head whose decision shall be final and executory after the lapse of thirty (30) days
from the receipt of the aggrieved party of said decision, unless appealed to the President in accordance with Executive Order No.
19, Series of 1966. The Decision of the Department Head may not be reviewed by the courts except through a special civil action
for certiorari or prohibition.

WHEREFORE, the Petition is GRANTED; the Decision of the respondent Court of Appeals dated October 16,
1991 and its Resolution dated July 14, 1992 are hereby SET ASIDE AND REVERSED; the Restraining Order
promulgated on September 27, 1993 is hereby made permanent; and the Secretary of DENR is directed to resolve the
controversy with utmost dispatch.
SO ORDERED.
Regalado, (Chairman), Romero, Puno, and Mendoza, JJ., concur.
FULGENCIO S. FACTORAN, JR., Secretary, Department of Environment and Natural Resources, VICENTE A.
ROBLES and NESTOR GAPUZAN, petitioners, vs. COURT OF APPEALS (Third Division), Hon. BENIGNO T.
DAYAW,as, Judge, Regional Trial Court of Quezon City, Branch 80, JESUS SY and LILY FRANCISCO
UY, respondents.

DECISION
DE LEON, JR., J.:

Before us is a petition for review on certiorari of the Decision and Resolution of the Court of Appeals dated March 30, 1990
and May 18, 1990, respectively, dismissing petitioners charge that Honorable Benigno T. Dayaw, Presiding Judge of Branch 80 of
the Regional Trial Court (RTC) of Quezon City, committed grave abuse of discretion in ordering them to deliver to private
respondents the six-wheeler truck and its cargo, some 4,000 board feet of narra lumber which were confiscated by the Department
of Environment and Natural Resources (DENR) and forfeited in favor of the government. [1]
The antecedent facts:
On August 9, 1988, two (2) police officers of the Marikina Police Station, Sub-Station III, intercepted a six-wheeler truck,
with Plate No. NJT-881, carrying 4,000 board feet of narra lumber as it was cruising along the Marcos Highway. They apprehended
the truck driver, private respondent Jesus Sy, and brought the truck and its cargo to the Personnel Investigation Committee/Special
Actions and Investigation Division (PIC/SAID) of the DENR Office in Quezon City. There, petitioner Atty. Vicente Robles of the
PIC/SAID investigated them, and discovered the following discrepancies in the documentation of the narra lumber: [2]

a. What were declared in the documents (Certificate of Timber Origin, Auxiliary Invoices and various Certifications) were narra
flitches, while the cargo of the truck consisted of narra lumber;

b. As appearing in the documents, the Plate Numbers of the truck supposed to carry the forest products bear the numbers BAX-
404, PEC-492 or NSN-267, while the Plate Number of the truck apprehended is NVT-881;

c. Considering that the cargo is lumber, the transport should have been accompanied by a Certificate of Lumber Origin, scale
sheet of said lumber and not by a Certificate of Timber Origin, which merely covers only transport of logs and flitches;

d. The Log Sale Purchase Agreement presented is between DSM Golden Cup International as the seller and Bonamy Enterprises
as the buyer/consignee and not with Lily Francisco Lumber and Hardware, [3]

which are in violation of Bureau of Forestry Development (BFD) Circular No. 10. The said BFD Circular requires possession or
transportation of lumber to be supported by the following documents: (1) Certificate of Lumber Origin (CLO) which shall be issued
only by the District Forester, or in his absence, the Assistant District Forester; (2) Sales Invoice; (3) Delivery Receipt; and (4) Tally
Sheets.[4] Such omission is punishable under Sec. 68 of Presidential Decree (P.D.) No. 705 otherwise known as the Revised Forestry
Code.[5] Thus, petitioner Atty. Robles issued a temporary seizure order and seizure receipt for the narra lumber and the six-wheeler
truck.[6]
On January 20, 1989, petitioner Fulgencio S. Factoran, then Secretary of Environment and Natural Resources (hereinafter
referred to as petitioner Secretary) issued an order for the confiscation of the narra lumber and the six-wheeler truck.[7]
Private respondents neither asked for reconsideration of nor appealed, the said order to the Office of the
President. Consequently, the confiscated narra lumber and six-wheeler truck were forfeited in favor of the government. They were
subsequently advertised to be sold at public auction on March 20, 1989.[8]
On March 17, 1989, private respondents filed a complaint with prayer for the issuance of writs of replevin and preliminary
injunction and/or temporary restraining order for the recovery of the confiscated lumber and six-wheeler truck, and to enjoin the
planned auction sale of the subject narra lumber, respectively.[9] Said complaint was docketed as Civil Case No. Q-89-2045 and
raffled to Branch 80 of the RTC of Quezon City.
On the same day, the trial court issued an Order directing petitioners to desist from proceeding with the planned auction sale
and setting the hearing for the issuance of the writ of preliminary injunction on March 27, 1989. [10]
On March 20, 1989, the scheduled date of the auction sale, private respondents filed an Ex-Parte Motion for Release and
Return of Goods and Documents (Replevin) supported by an Affidavit for Issuance of Writ of Replevin and Preliminary Injunction
and a Replevin Bond in the amount of P180,000.00.[11] The trial court granted the writ of replevin on the same day and directed the
petitioners to deliver the xxx [n]arra lumber, original documents and truck with plate no. NJT
881 to the custody of the plaintiffs and/or their representative x x x.[12]
On March 22, 1989, the trial court issued a writ of seizure. However, petitioners refused to comply therewith.[13] David G.
Brodett, Sheriff of Branch 80 of the RTC of Quezon City (hereinafter referred to as the Sheriff) reported that petitioners prevented
him from removing the subject properties from the DENR Compound and transferring them to the Mobil Unit Compound of the
Quezon City Police Force. To avoid any unwarranted confrontation between them, he just agreed to a constructive possession of
the properties in question.[14] In the afternoon of the same day, petitioners filed a Manifestation stating their intention to file a
counterbond under Rule 60 of the Rules of Court to stay the execution of the writ of seizure and to post a cash bond in the amount
of P180,000.00. But the trial court did not oblige petitioners for they failed to serve a copy of the Manifestation on private
respondents. Petitioners then immediately made the required service and tendered the cash counterbond in the amount of
P180,000.00, but it was refused, petitioners Manifestation having already been set for hearing on March 30, 1989. [15]
On March 27, 1989, petitioners made another attempt to post a counterbond which was, however, denied for the same
reason. [16]
On the same day, private respondents filed a motion to declare petitioners in contempt for disobeying the writ of
seizure.[17] The trial court gave petitioners twenty-four (24) hours to answer the motion. Hearing thereon was scheduled on March
30, 1989.
However, on March 29, 1989, petitioners filed with the Court of Appeals a Petition for Certiorari, Prohibition and/or
Mandamus to annul the Orders of the trial court dated March 20, 1989 and March 27, 1989. [18]
On March 30, 1989, the Court of Appeals granted petitioners temporary relief in the form of a temporary restraining order
(TRO).
On September 11, 1989, the Court of Appeals converted the TRO into a writ of preliminary injunction upon filing by
petitioners of a bond in the amount of P180,000.00.[19]
However, on March 30, 1990, the Court of Appeals lifted the writ of preliminary injunction and dismissed the petition. It
declared that as the complaint for replevin filed by private respondents complied with the requirements of an affidavit and bond
under Secs. 1 and 2 of Rule 60 of the Revised Rules of court, issuance of the writ of replevin was mandatory. [20]
As for the contempt charges against petitioners, the Court of Appeals believed the same were sufficiently based on a written
charge by private respondents and the report submitted by the Sheriff.[21]
On April 25, 1990, petitioners filed a motion for reconsideration of the foregoing decision. However, that motion was denied
by the Court of Appeals in its Resolution dated May 18, 1990.[22]
Hence this petition.
On the one hand, petitioners contend, thus:
(1) Confiscated lumber cannot be subject of replevin.[23]
(2) Petitioners not compelled to criminally prosecute private respondents but may opt only to confiscate lumber". [24]
(3) Private respondent charged criminally in court.[25] and
(4) Writ of Replevin issued in contravention of PD #605.[26]
On the other hand, private respondents argue that:
(1) The respondent Judge had jurisdiction to take cognizance of the
complaint for recovery of personal property and, therefore, had jurisdiction to issue the necessary orders in
connection therewith.[27]
(2) The issuance of the order for the delivery of personal property
upon application, affidavit and filing of replevin bond by the plaintiff is mandatory and not discretionary, hence,
no abuse of discretion can be committed by the trial court in the issuance thereof. [28]
(3) The Order of March 20, 1989 was in accordance with Section 4, Rule 60 of the Rules of Court and is, therefore,
valid.[29]
(4) The private respondents have not been proven to have violated Section 68 of the Revised Forestry Code. [30]
(5) The petitioners do not have the authority to keep private respondents property for an indefinite period, more so, to
dispose of the same without notice and hearing or without due process. [31]
(6) Contrary to the allegation of petitioners, no formal investigation was conducted by the PIC with respect to the
subject lumber in this case.[32]
(7) The alleged Order dated January 20, 1989 of the petitioner Secretary Fulgencio Factoran, Jr. of the DENR is not
valid and does not make the issuance of the order of replevin illegal. [33] and
(8) The subject properties were not in custody of the law and may be replevied. [34]
At the outset we observe that herein respondents never appealed the confiscation order of petitioner Secretary to the Office
of the President as provided for in Sec. 8 of P.D. No. 705 which reads:

All actions and decisions of the Director are subject to review, motu propio or upon appeal of any person aggrieved thereby, by
the Department Head whose decision shall be final and executory after the lapse of thirty (30) days from receipt by the
aggrieved party of said decision unless appealed to the President x x x. The decision of the Department Head may not be
reviewed by the courts except through a special civil action for certiorari and prohibition.

The doctrine of exhaustion of administrative remedies is basic. Courts, for reasons of law, comity and convenience, should not
entertain suits unless the available administrative remedies have first been resorted to and the proper authorities have been given
an appropriate opportunity to act and correct their alleged errors, if any, committed in the administrative forum. [35] As to the
application of this doctrine in cases involving violations of P.D. No. 705, our ruling in Paat v. Court of Appeals, is apropos:

Moreover, it is important to point out that the enforcement of forestry laws, rules and regulations and the protection, development
and management of forest lands fall within the primary and special responsibilities of the Department of Environment and
Natural Resources. By the very nature of its function, the DENR should be given a free hand unperturbed by judicial intrusion to
determine a controversy which is well within its jurisdiction. The assumption by the trial court, therefore, of the replevin suit
filed by private respondents constitutes an encroachment into the domain of the administrative agencys prerogative. The doctrine
of primary jurisdiction does not warrant a court to arrogate unto itself the authority to resolve a controversy the jurisdiction over
which is initially lodged with an administrative body of special competence. In Felipe Ismael, Jr. and Co. vs. Deputy Executive
Secretary, which was reiterated in the recent case of Concerned Officials of MWSS vs. Vasquez, this Court held:

Thus, while the administration grapples with the complex and multifarious problems caused by unbridled exploitation of these
resources, the judiciary will stand clear. A long line of cases establish the basic rule that the courts will not interfere in matters
which are addressed to the sound discretion of government agencies entrusted with the regulation of activities coming under the
special technical knowledge and training of such agencies.[36]

However, petitioners did not file a motion to dismiss based on the ground of non-exhaustion of administrative remedies. Thus,
it is deemed waived.[37]
Nonetheless, the petition is impressed with merit.
First. A writ of replevin does not just issue as a matter of course upon the applicants filing of a bond and affidavit, as the
Court of Appeals has wrongly put it. The mere filing of an affidavit, sans allegations therein that satisfy the requirements of Sec.
2, Rule 60 of the Revised Rules of Court, cannot justify the issuance of a writ of replevin. Said provision reads:

Affidavit and bond. - Upon applying for such order the plaintiff must show by his own affidavit or that of some other person who
personally knows the facts:

(a) That the plaintiff is the owner of the property claimed, particularly describing it, or entitled to the possession thereof;

(b) That the property is wrongfully detained by the defendant, alleging the cause of detention thereof to his best knowledge,
information, and belief;

(c) That it has not been taken for a tax assessment or fine pursuant to law, or seized under an execution, or an attachment against
the property of the plaintiff, or, if so seized, that it is exempt from such seizure; and

(d) The actual value of the property.

xxxxxxxxx.
Wrongful detention by the defendant of the properties sought in an action for replevin must be satisfactorily established. If
only a mechanistic averment thereof is offered, the writ should not be issued.
In the case at bar, the subject narra lumber and six-wheeler truck were confiscated by petitioner Secretary pursuant to Section
68-A of P.D. No. 705, as amended by Executive Order (E.O.) No. 277, to wit:

SEC. 68-A. Administrative Authority of the Department Head or His Duly Authorized Representative to Order Confiscation. - In
all cases of violations of this Code or other forest laws, rules and regulations, the Department Head or his duly authorized
representative, may order the confiscation of any forest products illegally cut, gathered, removed, or possessed or abandoned, and
all conveyances used either by land, water, or air in the commission of the offense and to dispose of the same in accordance with
pertinent laws, regulations or policies on the matter.[38]

As the petitioner Secretarys administrative authority to confiscate is clearly provided by law, the taking of the subject properties is
not wrongful and does not warrant the issuance of a writ of replevin prayed for by private respondents.
Second. Issuance of the confiscation order by petitioner Secretary was a valid exercise of his power under Sec. 68-A of P.D.
No. 705. By virtue of said order, the narra lumber and six-wheeler truck of private respondents were held in custodia legis and
hence, beyond the reach of replevin.
Property lawfully taken by virtue of legal process is deemed to be in custodia legis. [39] When a thing is in official custody of
a judicial or executive officer in pursuance of his execution of a legal writ, replevin will not lie to recover it.[40] Otherwise, there
would be interference with the possession before the function of law had been performed as to the process under which the property
was taken.[41] So basic is this doctrine that it found inclusion in the 1997 amendments introduced to the Rules of Civil Procedure.
Thus, Sec. 2(c), Rule 60 of the 1997 Rules of Civil Procedure provides that:

Affidavit and bond. - Upon applying for such order the plaintiff must show by his own affidavit or that of some other person who
personally knows the facts:

x x x x x x x x x;

(c) That the property has not been distrained or taken for a tax assessment or fine pursuant to law, or seized under a writ of
execution, or preliminary attachment or otherwise placed under custodia legis, or if so seized, that it is exempt from such seizure
or custody; x x x

x x x x x x x x x.[42]
Third. Petitioner Secretarys authority to confiscate forest products under Sec. 68-A of P.D. No. 705 is distinct from and
independent of the confiscation of forest products in a criminal action provided for in Section 68 of P.D. No. 705. Thus, in Paat,
we held that:

x x x precisely because of the need to make forestry laws more responsive to present situations and realities and in view of the
urgency to conserve the remaining resources of the country, that the government opted to add Section 68-A. This amendatory
provision is an administrative remedy totally separate and distinct from criminal proceedings. x x x. The preamble of EO 277 that
added Section 68-A to PD 705- is most revealing:

WHEREAS, there is an urgency to conserve the remaining forest resources of the country for the benefit and welfare of the
present and future generations of Filipinos;

WHEREAS, our forest resources may be effectively conserved and protected through the vigilant enforcement and
implementation of our forestry laws, rules and regulations;

WHEREAS, the implementation of our forestry laws suffers from technical difficulties, due to certain inadequacies in the Penal
provisions of the Revised Forestry Code of the Philippines; and

WHEREAS, to overcome this [sic] difficulties, there is a need to penalize certain acts more responsive to present situations and
realities;

It is interesting to note that Section 68-A is a new provision authorizing the DENR to confiscate, not only conveyances but forest
products as well. On the other hand, confiscation of forest products by the court in a criminal action has long been provided for in
Section 68. If as private respondents insist, the power of confiscation cannot be exercised except only through the court under
Section 68, then Section 68-A would have no purpose at all. Simply put, Section 68-A would not have provided any solution to
the problem perceived in EO 277, x x x.[43]
Sec. 68-A was added precisely to supplant the inadequacies and supplement criminal enforcement of forestry laws.
Fourth. Sec. 80 of P. D. No. 705 which requires delivery of the seized forest products within six (6) hours from the time of
the seizure to the appropriate official designated by law to conduct preliminary investigations applies only to criminal prosecutions
provided for in Sec. 68, and not to administrative confiscation provided for in Section 68-A.
Sec. 80 of P.D. No. 705 provides:

SEC. 80. Arrest; Institution of criminal actions. - A forest officer or employee of the Bureau shall arrest even without a warrant
any person who has committed or is committing in his presence any of the offenses defined in this Chapter. He shall also seize
and confiscate, in favor of the Government, the tools and equipment used in committing the offense, and the forest products cut,
gathered or taken by the offender in the process of committing the offense. The arresting officer or employee shall thereafter
deliver within six (6) hours from the time of arrest and seizure, the offender and the confiscated forest products, tools and
equipment to, and file the proper complaint with, the appropriate official designated by law to conduct preliminary investigations
and file informations in court.

x x x x x x x x x.
The title of Sec. 80 - Arrest; Institution of Criminal Actions - bespeaks this intendment of the law. The fact, too, that Secs. 68 and
80 were co-existing prior to the introduction of Sec. 68-A, proves that Sec. 80 applies to the criminal prosecutions subject of Sec.
68 and not to the administrative confiscation subject of Sec. 68-A. Sec. 68-A, therefore, should not be interpreted in relation to Sec.
80 as to require that criminal charges be filed with and seized forest products be immediately delivered to, the fiscal in case of
administrative confiscation, for this renders nugatory the purpose sought to be achieved thereby. Statutes should always be
construed in the light of the object to be achieved and the evil or mischief to be suppressed, and they should be given such
interpretation as will advance the object, suppress the mischief, and secure the benefits intended. [44]
Fifth. Nothing in the records supports private respondents allegation that their right to due process was violated as no
investigation was conducted prior to the confiscation of their properties.
On the contrary, by private respondents own admission, private respondent Sy who drove the six-wheeler truck was properly
investigated by petitioner Atty. Robles at the PIC/SAID Office of the DENR. Thereafter, private respondent Sy and his witnesses
were given full opportunity to explain the deficiencies in the documents.[45] Private respondents categorically stated that they made
a continuous and almost daily follow-up and plea x x x with the PIC for the return of the truck and lumber x x x. [46] Finally in a
letter dated December 30, 1989, private respondent Lily Francisco Uy requested petitioner Secretary for immediate resolution and
release of the impounded narra sawn lumber.[47]
Undoubtedly, private respondents were afforded an opportunity to be heard before the order of confiscation was issued. There
was no formal or trial type hearing but the same is not, in all instances, essential in administrative proceedings. It is settled that due
process is satisfied when the parties are afforded fair and reasonable opportunity to explain their side of the controversy or an
opportunity to move for a reconsideration of the action or ruling complained of. [48]
Moreover, respondents claim that the order of confiscation was antedated and not the product of the investigation supposedly
conducted by the PIC of the DENR. However, they proffer no proof to support that allegation. On the other hand, there is the legal
presumption that official duty has been regularly performed. The presumption of regularity in the performance of official duties is
even particularly strong with respect to administrative agencies like the DENR which are vested with quasi-judicial powers in
enforcing the laws affecting their respective fields of activity, the proper regulation of which requires of them such technical
mastery of all relevant conditions obtaining in the nation.[49]
Finally. The writ of seizure and the writ of replevin were issued by the trial court in grave abuse of its discretion. Thus,
disobedience thereto cannot constitute indirect contempt of court which presupposes that the court order thereby violated was valid
and legal. Without a lawful order having been issued, no contempt of court could be committed. [50]
WHEREFORE, the instant petition is hereby GRANTED. The Decision of the Court of Appeals dated March 30, 1990 and
its Resolution dated May 18, 1990 in CA-G.R. SP No. 17194 are hereby SET ASIDE and REVERSED. Respondent Presiding
Judge Benigno T. Dayaw, of the Regional Trial Court of Quezon City, is PERMANENTLY ENJOINED from enforcing the Orders
dated March 20, 1989 and March 22, 1989 in Civil Case No. Q-89-2045, or if said orders have already been enforced, the said
respondent Judge is directed to render judgment of forfeiture on the replevin bond filed by private respondents. Finally, the said
respondent Judge is PERMANENTLY ENJOINED from further acting on the Motion for Contempt filed by private respondents
against the petitioners.
Costs against private respondents.
SO ORDERED.
Bellosillo, (Chairman), Mendoza, Quisumbing and Buena, JJ., concur.
Supreme Court of Nevada.
PROVINCIAL GOVERNMENT OF MARINDUQUE, Appellant, v. PLACER
DOME, INC.; and Barrick Gold Corporation, Respondents.

No. 57956.
Decided: June 11, 2015
BEFORE THE COURT EN BANC.1Snell & Wilmer L.L.P. and Patrick G. Byrne, Las Vegas; Snell & Wilmer
L.L.P. and Neil Peck and Jessica E. Yates, Denver, Colorado; Diamond McCarthy, L.L.P., and James D.
McCarthy, Walter J. Scott, David Ammons, and Reda Hicks, Dallas, Texas, for Appellant. Morris Law
Group and Steve L. Morris and Rex D. Garner, Las Vegas; Arnold & Porter LLP and Edward Han,
Washington, D.C.; Arent Fox LLP and Martin F. Cunniff, Washington, D.C., for Respondents.

OPINION

In this appeal, we are asked to determine whether the district court abused its discretion by dismissing a
complaint for forum non conveniens when the events giving rise to the complaint occurred in the
Republic of the Philippines and the alternative fora are in Canada. Because this matter has no bona fide
connection to this state, we conclude that the district court properly exercised its discretion by granting
the motion to dismiss for forum non conveniens. We further conclude that the district court imposed
appropriate conditions to ensure the adequacy of the alternative fora without requiring appellant to
proceed in any particular forum. Accordingly, we affirm.

FACTS AND PROCEDURAL HISTORY

Appellant, the Provincial Government of Marinduque (the Province), is a political subdivision of the
Republic of the Philippines. Respondent Placer Dome, Inc. (PDI), was incorporated under the laws of
British Columbia, Canada. Beginning in the 1950s, a predecessor of PDI formed Marcopper Mining
Corporation to undertake mining activities in the Province. This predecessor, and later PDI, held a
substantial minority of the shares of Marcopper. According to the Province, PDI and its predecessor
controlled all aspects of Marcopper's operations. During the course of Marcopper's operations, several
incidents occurred that caused significant environmental degradation and health hazards to the people
living in the Province, who are known as Marinduqueños.

These incidents and the harms resulting therefrom were investigated by several organizations, including
United States Geological Survey (U.S.G.S.) teams. U.S.G.S. documents regarding the disasters are located
in Colorado and Virginia, and U.S.G.S. team members reside throughout the United States. Several
participants in medical missions to the Province also reside across the United States. Many witnesses
whose testimony would be material to the Province's claims live in the Philippines. Many individuals
named in the Province's operative complaint as being involved with Mar copper or PDI live in Canada, but
some live in the United States. Few, if any, material witnesses reside in Nevada.

At the time the Province filed its complaint in the district court, PDI subsidiaries owned mining
operations in Nevada. Shortly thereafter, PDI and another business entity amalgamated under the laws of
Ontario, Canada, to form respondent Barrick Gold Corporation. Barrick's subsidiaries have continued
substantial mining operations in Nevada. Barrick and PDI contend that only their subsidiaries conduct
business in Nevada and personal jurisdiction is therefore lacking. The Province responds that the
corporate veils may be pierced to establish personal jurisdiction in Nevada over both Barrick and PDI.

Barrick and PDI moved to dismiss for forum non conveniens, arguing that either British Columbia, where
PDI was incorporated, or Ontario, where Barrick was formed, would provide a better forum for this
litigation. The Province opposed this motion and alternatively asked the district court to condition
dismissal on Barrick's and PDI's consent to jurisdiction in the Philippines. Because the Province is a
foreign plaintiff, the district court gave the Province's choice of a Nevada forum “little deference.” The
district court found that the Philippines would be the best forum for this litigation and stated that the
Province could file a complaint there, but the court refused to condition dismissal on Barrick's and PDI's
consent to jurisdiction in the Philippines. The district court further found that either British Columbia or
Ontario provided an adequate alternative forum. After analyzing several public and private interest
factors, the district court found that dismissal for forum non conveniens was warranted. The district court
conditioned dismissal on Barrick's and PDFs (1) waiver of personal jurisdiction, statute of limitations, and
forum non conveniens arguments in British Columbia and Ontario; and (2) stipulation that both
monetary and injunctive relief would be available in British Columbia and Ontario. Because Barrick and
PDI agreed to these conditions, the district court dismissed the action without prejudice. The Province
now appeals.

DISCUSSION

We review a district court's order dismissing an action for forum non conveniens for an abuse of
discretion. Payne v. Eighth Judicial Dist Court, 97 Nev. 228, 229, 626 P.2d 1278, 1279 (1981), overruled
on other grounds by Pan v. Eighth Judicial Dist. Court, 120 Nev. 222, 228, 88 P.3d 840, 844 (2004).

When deciding a motion to dismiss for forum non conveniens, a court must first determine the level of
deference owed to the plaintiff's forum choice. Pollux Holding Ltd. v. Chase Manhattan Bank, 329 F.3d
64, 70 (2d Cir.2003). Next, a district court must determine “whether an adequate alternative forum
exists.” Lueck v. Sundstrand Corp., 236 F.3d 1137, 1142 (9th Cir.2001) (citing Piper Aircraft Co. v. Reyno,
454 U.S. 235, 254 n. 22 (1981)). If an adequate alternative forum does exist, the court must then weigh
public and private interest factors to determine whether dismissal is warranted. Id. Dismissal for forum
non conveniens is appropriate “only in exceptional circumstances when the factors weigh strongly in favor
of another forum.” Eaton v. Second Judicial Dist. Court, 96 Nev. 773, 774–75, 616 P.2d 400, 401 (1980),
overruled on other grounds by Pan, 120 Nev. at 228, 88 P .3d at 844.

The Province's choice of a Nevada forum was entitled to less deference

Generally, a plaintiff's choice of forum is entitled to great deference, but a foreign plaintiff's choice of a
United States forum is entitled to less deference. Pollux Holding, 329 F.3d at 71. While the law recognizes
the validity of a foreign plaintiff's selection of a United States forum in order to obtain jurisdiction over a
defendant, a foreign plaintiff's choice will be entitled to substantial deference only where the case has
bona fide connections to and convenience favors the chosen forum. Id. at 74.

First, the Province contends that the district court should not have reduced the level of deference owed to
its forum choice because it selected a Nevada forum to obtain personal jurisdiction over PDI. Even with
this legitimate reason for choosing a foreign forum, the Province's choice is only entitled to additional
deference to the extent that this case has bona fide connections to this state and convenience favors
litigating this case in Nevada. See id. Because the Province only argues that personal jurisdiction is proper
in Nevada through piercing Barrick's and PDI's corporate veils, the link between the Province's forum
choice and its stated reason for that choice—establishing personal jurisdiction—is tenuous. See id.
Moreover, Barrick's and PDFs subsidiaries' business activities are the only connection that this litigation
appears to have with this state. This is not the type of bona fide connection that justifies giving a foreign
plaintiffs forum choice substantial deference. See id. Accordingly, we conclude that the district court
properly gave reduced deference to the Province's forum choice. See Piper Aircraft, 454 U.S. at 255–56;
Pollux Holding, 329 F.3d at 74.

Second, the Province argues that the district court applied the wrong level of deference by stating that the
Province's forum choice was entitled to “little deference.” The district court also quoted Piper Aircraft, 454
U.S. at 256, however, to state that “a foreign plaintiffs choice [of forum] deserves less deference.” Because
the district court referred to the appropriate “less deference” standard, we conclude that using the word
“little,” although unusual in this context, does not indicate an abuse of discretion. See Payne, 97 Nev. at
229, 626 P.2d at 1279. We therefore conclude that the district court properly gave less deference to the
Province's choice of a Nevada forum.2 Piper Aircraft, 454 U.S. at 255–56.

The district court did not abuse its discretion by finding that the public and private interest factors
favored dismissal for forum non conveniens
The Province does not argue on appeal that British Columbia and Ontario are inadequate alternative fora.
Therefore, we now turn to the district court's analysis of the public and private interest factors. See Lueck,
236 F.3d at 1142.

The district court did not abuse its discretion in its analysis of the public interest factors

The Province argues that the district court abused its discretion by finding that the public interest factors
favored dismissal for forum non conveniens. We disagree.

Relevant public interest factors include the local interest in the case, the district court's familiarity with
applicable law, the burdens on local courts and jurors, court congestion, and the costs of resolving a
dispute unrelated to the plaintiffs chosen forum. Lueck, 236 F.3d at 1147 (citing Piper Aircraft, 454 U.S. at
259–61).

As to the local interest in this case, the district court concluded that either Canadian forum had more
interest in this matter than Nevada. The Province contends that some Marinduqueños living in Nevada
may be interested in this litigation, but that does not mean that Nevada, or even Clark County, as a whole
has an interest in this lawsuit. Barrick is incorporated and headquartered in Ontario, Barrick and PDI
claim that only their subsidiaries have conducted business activities in Nevada, and no events related to
this litigation occurred in Nevada. Thus, this case lacks any genuine connection to this state, and the
district court did not abuse its discretion by finding that there would be only minimal local interest in this
litigation. See id.; Payne, 97 Nev. at 229, 626 P.2d at 1279.

The district court also noted that neither it nor Canadian courts would be familiar with the laws of the
Philippines governing the Province's claims, but Canadian law might govern some issues. The Province
has not demonstrated that the district court abused its discretion by weighing this factor slightly in favor
of dismissal. Payne, 97 Nev. at 229, 626 P.2d at 1279.

It cannot be disputed that this complicated case will impose heavy burdens on any court. The events
giving rise to this litigation span several decades, and extensive expert testimony will undoubtedly be
necessary to prove the Province's claims and damages. Thus, the district court did not abuse its discretion
by finding that the burdens and costs of resolving this matter, which lacks any real connection to this
state, support dismissal. See Lueck, 236 F.3d at 1147. Similarly, the district court did not abuse its
discretion by finding that severe court congestion in the Eighth Judicial District favored dismissal. See id.

Moreover, the district court did not abuse its discretion by concluding that the weight of these factors
favoring dismissal is compounded by the fact that the parties continue to dispute whether personal
jurisdiction is proper in Nevada. Where “personal jurisdiction is difficult to determine, and forum non
conveniens considerations weigh heavily in favor of dismissal,” a court may properly dismiss a complaint
for forum non conveniens without first deciding whether it has personal jurisdiction over the defendant.
Sinochem Int'l Co. Ltd. v. Malaysia Int'l Shipping Corp., 549 U .S. 422, 436 (2007). Where a genuine
dispute as to personal jurisdiction exists, a district court may properly consider this dispute in the forum
non conveniens analysis. See id. at 435–36.

As the district court stated, resolving the preliminary issue of personal jurisdiction alone “would likely
entail extensive discovery, briefing, and multiple court hearings.” It is undisputed that Barrick's and PDI's
subsidiaries conducted business in Nevada, but the Province alleges that Barrick and PDI ignored
corporate formalities, such that the corporate veils may be pierced to establish personal jurisdiction. See
Viega GmbH v. Eighth Judicial Dist. Court, 130 Nev., Adv. Op. 40, 328 P.3d 1152, 1157 (2014) (stating that
subsidiaries' contacts with a forum may support personal jurisdiction over a parent if the corporate veil is
pierced). Whether a corporate veil should be pierced is a question of fact involving several factors. LFC
Mktg. Grp., Inc. v. Loomis, 116 Nev. 896, 904, 8 P.3d 841, 846–47 (2000). Thus, whether personal
jurisdiction is proper in Nevada under the alter ego doctrine could only be determined after significant
discovery regarding the corporate practices of Barrick, PDI, and their subsidiaries. Accordingly, the
existence of this dispute weighs heavily in favor of dismissal for forum non conveniens, and the district
court properly considered Barrick's and PDFs personal jurisdiction objections in its analysis. See
Sinochem, 549 U.S. at 435–36.
The district court did not abuse its discretion by finding that the private interest factors favored dismissal
for forum non conveniens

We also conclude that the district court properly exercised its discretion in its analysis of the private
interest factors. Relevant private interest factors may include the location of a defendant corporation,
access to proof, the availability of compulsory process for unwilling witnesses, the cost of obtaining
testimony from willing witnesses, and the enforceability of a judgment. Lueck, 236 F.3d at 1145; see also
Eaton, 96 Nev. at 774, 616 P.2d at 401.

The district court found that no parties or witnesses reside in Nevada, whereas some witnesses reside in
Canada, and compulsory process is available throughout Canada. Although the Province contends that
Barrick and PDI failed to demonstrate the materiality of these witnesses' testimony, many of these
witnesses were named in the Province's operative complaint, indicating that the Province believed their
testimony could be material. Thus, the district court did not abuse its discretion by concluding that these
factors favored dismissal. See Lueck, 236 F.3d at 1145–46.

We note that the district court's order did not mention U.S.G.S. documents located in Virginia and
Colorado, U.S.G.S. witnesses residing throughout the United States, or witnesses residing in the United
States who participated in medical missions to Marinduque. The fact remains, however, that none of these
documents or witnesses is in Nevada, the Province's chosen forum. Therefore, even though the district
court did not mention this evidence, the district court did not abuse its discretion by concluding that the
ease of bringing witnesses and evidence to trial favored dismissal for forum non conveniens. See id.

Finally, the district court concluded that a judgment could be more readily enforced against Barrick in
Canada than in Nevada. Because Barrick is incorporated under the laws of Ontario and headquartered
there, we cannot conclude that this finding amounted to an abuse of discretion. See id.

Taking all of the public and private interest factors together, we conclude that the district court did not
abuse its discretion by dismissing the Province's complaint for forum non conveniens. See id.; Payne, 97
Nev. at 229, 626 P.2d at 1279.

Finding that litigating in Nevada would not harass, oppress, or vex Barrick and PDI did not require the
district court to deny the motion to dismiss for forum non conveniens

Finally, the Province contends that because the district court found that litigating in Nevada would not
subject Barrick and PDI “to harassment, oppression, or vexatiousness,” the district court could not grant
dismissal for forum non conveniens as a matter of law. We disagree.

We have stated that in addition to the factors discussed above, a district “court should also consider
whether failure to apply the doctrine would subject the defendant to harassment, oppression,
vexatiousness or inconvenience.” Eaton, 96 Nev. at 774, 616 P.2d at 401 (emphasis added). Thus, we have
treated the issues of harassment, oppression, and vexatiousness as factors to be considered in the forum
non conveniens analysis, not the dispositive talismans that the Province holds them out to be. See id. The
Province has not suggested any compelling reason to depart from this approach, and we decline to do so.
See Miller v. Burk, 124 Nev. 579, 597, 188 P.3d 1112, 1124 (2008) (stating that this court will not overturn
precedent “absent compelling reasons”). Therefore, the district court was not required to deny the motion
to dismiss simply because it found that litigating this matter in Nevada would not harass, oppress, or vex
Barrick and PDI.

The district court properly exercised its discretion in imposing conditions on dismissal for forum non
conveniens

A district court has discretion to impose conditions on a forum non conveniens dismissal to ensure that
the case may be heard in an alternative forum. See, e.g., In re Union Carbide Corp. Gas Plant Disaster at
Bhopal, India in Dec., 1984, 809 F.2d 195, 203–04 (2d Cir.1987); see also Tuazon v. R.J. Reynolds
Tobacco Co., 433 F.3d 1163, 1178 (9th Cir.2006).
The Province argues that the district court should have conditioned dismissal on Barrick's and PDI's
submission to jurisdiction in the Philippines. The Province relies on Cortec Corp. v. Erste Bank Ber
Oesterreichischen Sparkassen AG, 535 F.Supp.2d 403 (S.D.N.Y.2008). In Cortec, the defendant offered
Croatia as an alternative forum, and the district court sua sponte considered Austria as an alternative
forum. Id. at 407, 411. The defendant in Cortec did not object to Austrian jurisdiction, see id. at 411, and
the district court imposed conditions on dismissal to ensure that the case could be heard in either Croatia
or Austria, id. at 409, 413. Here, Barrick and PDI consent to jurisdiction in either British Columbia or
Ontario, but continue to object to Philippine jurisdiction. We note that nothing in the district court's order
prevents the Province from filing this action in the courts of the Philippines—the district court simply
declined to condition dismissal on Barrick's and PDI's submission to jurisdiction in the Philippines. The
Province has not cited and we have not found any authority stating that a district court may condition
forum non conveniens dismissal on a defendant's submission to jurisdiction in a single forum that the
defendant opposes. Moreover, adopting such a position would encourage plaintiffs to file lawsuits in
Nevada that have no connection to this state, in the hope that district courts would condition forum non
conveniens dismissals on defendants' submission to jurisdiction in other fora that the defendants
opposed. We decline to turn the courts of this state into mere conduits for lawsuits that belong elsewhere.

To the extent that Barrick and PDI oppose the conditions imposed by the district court, we conclude that
any such opposition lacks merit. An alternative forum is adequate if “the defendant is amenable to process
in the other jurisdiction,” Piper Aircraft, 454 U.S. at 254 n. 22 (internal quotation marks omitted), and the
alternative forum “provide[s] the plaintiff with some remedy for his wrong,” Lueck, 236 F.3d at 1143. A
forum is inadequate “if a statute of limitations bars the bringing of the case in that forum.” Bank of Credit
& Commerce Int'l Ltd. v. State Bank of Pakistan, 273 F.3d 241, 246 (2d Cir.2001). “District courts are not
required to impose conditions on forum non conveniens dismissals, but it is an abuse of discretion to fail
to do so when there is a justifiable reason to doubt that a party will cooperate with the foreign forum.”
Carijano v. Occidental Petroleum Corp., 643 F.3d 1216, 1234 (9th Cir.2011) (internal quotation marks
omitted).

Here, the district court conditioned dismissal on Barrick's and PDI's (1) waiver of personal jurisdiction,
statute of limitations, and forum non conveniens arguments in Ontario and British Columbia; and (2)
stipulation that monetary and injunctive relief are available in either Canadian forum. These conditions
merely ensured that Barrick and PDI would be amenable to suit in the alternative fora and the Province
would have some remedy. Therefore, these conditions guaranteed the availability and adequacy of an
alternative forum, see Piper Aircraft, 454 U.S. at 254 n. 22; Bank of Credit & Commerce Int'l, 273 F.3d at
246; Lueck, 236 F.3d at 1143, and the district court did not abuse its discretion by imposing these
conditions, see Carijano, 643 F.3d at 1234.

CONCLUSION

We conclude that the district court properly gave less deference to the Province's choice of a Nevada
forum. Applying this less deference standard, the district court did not abuse its discretion by dismissing
the Province's complaint for forum non conveniens because, among other reasons, this case lacks any
bona fide connection to this state, adequate alternative for a exist, and the burdens of litigating here
outweigh any convenience to the Province. Finally, we hold that the district court imposed appropriate
conditions on dismissal to ensure the existence of an adequate alternative forum for this litigation.
Therefore, we affirm the district court's order dismissing the complaint for forum non conveniens.

FOOTNOTES

2. The Province further argues that it is not a foreign plaintiff whose forum choice may be given less
deference because it is suing as parens patriae and some Marinduquñeos reside in Nevada. Because the
Province fails to further explain its argument or cite any authority in support of it, we decline to address
this argument. See Edwards v. Emperor's Garden Rest., 122 Nev. 317, 330 n. 38, 130 P.3d 1280, 1288 n.
38 (2006) (stating that this court need not consider claims that are not cogently argued or supported by
relevant authority).

By the Court, PARRAGUIRRE, J.:


We concur: HARDESTY, C.J., and DOUGLAS, CHERRY, SAITTA, and GIBBONS, JJ.
CELESTIAL NICKEL MINING G.R. No. 169080
EXPLORATION CORPORATION,
Petitioner,
Present:
- versus -
QUISUMBING, J., Chairperson,
CARPIO MORALES,
MACROASIA CORPORATION TINGA,
(formerly INFANTA MINERAL AND VELASCO, JR., and
INDUSTRIAL CORPORATION), CHICO-NAZARIO,* JJ.
BLUE RIDGE MINERAL
CORPORATION, and LEBACH
MINING CORPORATION,
Respondents.

x ---------------------------------------------- x

BLUE RIDGE MINERAL G.R. No. 172936


CORPORATION,
Petitioner,

- versus -

HON. ANGELO REYES in his


capacity as SECRETARY of
the DEPARTMENT OF
ENVIRONMENT AND NATURAL Promulgated:
RESOURCES, HON. GUILLERMO
ESTABILLO in his capacity as
REGIONAL DIRECTOR of the December 19, 2007
MINES AND GEOSCIENCES
BUREAU, REGION IV-B of the
DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES, and
MACROASIA CORPORATION
(formerly INFANTA MINERAL AND
INDUSTRIAL CORPORATION),
Respondents.

x ---------------------------------------------- x

CELESTIAL NICKEL MINING G.R. No. 176226


EXPLORATION CORPORATION,
Petitioner,

- versus -

BLUE RIDGE MINERAL


CORPORATION and MACROASIA
CORPORATION (formerly INFANTA
MINERAL AND INDUSTRIAL
CORPORATION),
Respondents.
x ---------------------------------------------- x

MACROASIA CORPORATION G.R. No. 176319


(formerly INFANTA MINERAL AND
INDUSTRIAL CORPORATION),
Petitioner,
- versus -

BLUE RIDGE MINERAL


CORPORATION and CELESTIAL
NICKEL MINING EXPLORATION
CORPORATION,
Respondents.
x-----------------------------------------------------------------------------------------x

DECISION

VELASCO, JR., J.:

The Case

Before us are four (4) petitions. The first is a Petition for Review on Certiorari[1] under Rule 45 docketed as G.R. No.
169080, wherein petitioner Celestial Nickel Mining Exploration Corporation (Celestial) seeks to set aside the April 15, 2005
Decision[2] of the Court of Appeals (CA) in CA-G.R. SP No. 87931. The CA affirmed the November 26, 2004 Resolution of the
Mines Adjudication Board (MAB) in MAB Case Nos. 056-97 and 057-97 (DENR Case Nos. 97-01 and 97-02), upholding the
authority of the Department of Environment and Natural Resources (DENR) Secretary to grant and cancel mineral agreements.
Also assailed is the August 3, 2005 Resolution[3] of the CA denying the Motion for Reconsideration of the assailed Decision.

The second is a Petition for Certiorari[4] under Rule 65 docketed as G.R. No. 172936, wherein petitioner Blue Ridge
Mineral Corporation (Blue Ridge) seeks to annul and set aside the action of then Secretary Michael T. Defensor, in his capacity as
DENR Secretary, approving and signing two Mineral Production Sharing Agreements (MPSAs) in favor of Macroasia Corporation
(Macroasia) denominated as MPSA Nos. 220-2005-IVB and 221-2005-IVB.

And the third and fourth are petitions for review on certiorari[5] under Rule 45 docketed as G.R. No. 176226 and G.R.
No. 176319, wherein petitioners Celestial and Macroasia, respectively, seek to set aside the May 18, 2006 Decision[6] of the CA in
CA-G.R. SP No. 90828. The CA reversed and set aside the November 26, 2004 and July 12, 2005 Resolutions of the MAB, and
reinstated the October 24, 2000 Decision in MAB Case Nos. 056-97 and 057-97, granting Blue Ridge the prior and preferential
right to file its application over the mining claims of Macroasia. These petitions likewise seek to set aside the January 19,
2007 Resolution[7] of the CA denying petitioners motions for reconsideration of the assailed Decision.

Through our July 5, 2006 Resolution,[8] we consolidated the first two cases. While in our subsequent April 23,
2007[9] and July 11, 2007[10] Resolutions, we consolidated the four cases as they arose from the same facts.

The undisputed facts as found by the CA in CA-G.R. SP No. 87931 are as follows:

On September 24, 1973, the then Secretary of Agriculture and Natural Resources and Infanta Mineral and Industrial Corporation
(Infanta) entered into a Mining Lease Contract (V-1050) for a term of 25 years up to September 23, 1998 for mining lode claims
covering an area of 216 hectares at Sitio Linao, Ipilan, Brookes Point, Palawan. The mining claims of Infanta covered by lode/lease
contracts were as follows:

Contract No. Area Date of Issuance


LLC-V-941 18 hectares January 17, 1972
LC-V-1050 216 hectares September 24, 1973
LLC-V-1060 16 hectares October 30, 1973
LLC-V-1061 144 hectares October 30, 1973
LLC-V-1073 144 hectares April 18, 1973
MLC-MRD-52 306 hectares April 26, 1978
MLC-MRC-53 72 hectares April 26, 1978

Infantas corporate name was changed to Cobertson Holdings Corporation on January 26, 1994 and subsequently to its present
name, Macroasia Corporation, on November 6, 1995.

Sometime in 1997, Celestial filed a Petition to Cancel the subject mining lease contracts and other mining claims of Macroasia
including those covered by Mining Lease Contract No. V-1050, before the Panel of Arbitrators (POA) of the Mines and Geo-
Sciences Bureau (MGB) of the DENR. The petition was docketed as DENR Case No. 97-01.
Blue Ridge, in an earlier letter-petition, also wrote the Director of Mines to seek cancellation of mining lease contracts and other
mining rights of Macroasia and another entity, Lebach Mining Corporation (Lebach), in mining areas in Brookes Point. The petition
was eventually docketed as DENR Case No. 97-02.

Celestial is the assignee of 144 mining claims covering such areas contiguous to Infantas (now Macroasia) mining lode claims. Said
area was involved in protracted administrative disputes with Infanta (now Macroasia), Lecar & Sons, Inc., and Palawan Nickel
Mining Corporation. Celestial also holds an MPSA with the government which covers 2,835 hectares located at Ipilan/Maasin,
Brookes Point, Palawan and two pending applications covering another 4,040 hectares in Barangay Mainit also in Brookes Point.

Celestial sought the cancellation of Macroasias lease contracts on the following grounds: (1) the nonpayment of
Macroasia of required occupational fees and municipal taxes; (2) the non-filing of Macroasia of Affidavits of Annual Work
Obligations; (3) the failure of Macroasia to provide improvements on subject mining claims; (4) the concentration of Macroasia on
logging; (5) the encroachment, mining, and extraction by Macroasia of nickel ore from Celestials property; (6) the ability of
Celestial to subject the mining areas to commercial production; and (7) the willingness of Celestial to pay fees and back taxes of
Macroasia.

In the later part of the proceedings, Macroasia intervened in the case and submitted its position paper refuting the grounds for
cancellation invoked by Celestial.[11]

The Ruling of the Panel of Arbitrators in


DENR Case Nos. 97-01 and 97-02

Based on the records of the Bureau of Mines and findings of the field investigations, the POA found that Macroasia and
Lebach not only automatically abandoned their areas/mining claims but likewise had lost all their rights to the mining claims. The
POA granted the petition of Celestial to cancel the following Mining Lease Contracts of Macroasia: LLC-V-941, LLC-V-1050,
LLC-V-1060, LLC-V-1061, LLC-V-1073, MLC-MRD-52, and MLC-MRC-53; and found the claims of the others indubitably
meritorious. It gave Celestial the preferential right to Macroasias mining areas.[12] It upheld Blue Ridges petition regarding DENR
Case No. 97-02, but only as against the Mining Lease Contract areas of Lebach (LLC-V-1153, LLC-V-1154, and LLC-V-1155),
and the said leased areas were declared automatically abandoned. It gave Blue Ridge priority right to the aforesaid Lebachs
areas/mining claims.[13]

Blue Ridge and Macroasia appealed before the MAB, and the cases were docketed as MAB Case Nos. 056-97 and 057-
97, respectively.

Lebach did not file any notice of appeal with the required memorandum of appeal; thus, with respect to Lebach, the above
resolution became final and executory.

The Rulings of the Mines Adjudication Board in


MAB Case Nos. 056-97 and 057-97 (DENR Case Nos. 97-01 and 97-02)

The MAB resolved the issues of timeliness and perfection of Macroasias appeal; Macroasias abandonment of its mining
claims; and the preferential right over the abandoned mining claims of Macroasia.

Conformably with Section 51 of Consolidated Mines Administrative Order (CMAO) [14] implementing Presidential
Decree No. (PD) 463[15] and our ruling in Medrana v. Office of the President (OP),[16] the MAB affirmed the POA findings that
Macroasia abandoned its mining claims. The MAB found that Macroasia did not comply with its work obligations from 1986 to
1991. It based its conclusion on the field verifications conducted by the MGB, Region IV and validated by the Special Team tasked
by the MAB.[17] However, contrary to the findings of the POA, the MAB found that it was Blue Ridge that had prior and preferential
rights over the mining claims of Macroasia, and not Celestial.

Thus, on October 24, 2000, the MAB promulgated its Decision upholding the Decision of the POA to cancel the Mining
Lode/Lease Contracts of Macroasia; declaring abandoned the subject mining claims; and opening the mining area with prior and
preferential rights to Blue Ridge for mining applications, subject to strict compliance with the procedure and requirements provided
by law. In case Blue Ridge defaults, Celestial could exercise the secondary priority and preferential rights, and subsequently, in
case Celestial also defaults, other qualified applicants could file.[18]
Both Celestial and Macroasia moved for reconsideration.[19] Celestial asserted that it had better rights than Blue
Ridge over the mining claims of Macroasia as it had correctly filed its petition, and filed its MPSA application after Macroasias
lease contract expired on January 17, 1997 and after the POAs resolution was issued on September 1, 1997. Moreover, it argued
that priority was not an issue when the contested area had not yet been declared abandoned. Thus, Blue Ridges MPSA application
filed on June 17, 1996 had no effect and should not be considered superior since Macroasias lease contracts were still valid and
subsisting and could not have been canceled by Macroasias mere failure to perform annual work obligations and pay corresponding
royalties/taxes to the government.

Macroasia, in its Motion for Reconsideration, reiterated that it did not abandon its mining claims, and even if mining was
not listed among its purposes in its amended Articles of Incorporation, its mining activities were acts that were only ultra vires but
were ratified as a secondary purpose by its stockholders in subsequent amendments of its Articles of Incorporation.

Before the MAB could resolve the motions for reconsideration, on March 16, 2001, Macroasia filed its Supplemental
Motion for Reconsideration[20] questioning the jurisdiction of the POA in canceling mining lease contracts and mining
claims.Macroasia averred that the power and authority to grant, cancel, and revoke mineral agreements is exclusively lodged with
the DENR Secretary. Macroasia further pointed out that in arrogating upon itself such power, the POA whimsically and capriciously
discarded the procedure on conferment of mining rights laid down in Republic Act No. (RA) 7942, The Philippine Mining Act of
1995, and DENR Administrative Order No. (AO) 96-40,[21] and perfunctorily and improperly awarded its mining rights to Blue
Ridge and Celestial.

Subsequently, on November 26, 2004, the MAB issued a Resolution [22] vacating its October 24, 2000 Decision, holding
that neither the POA nor the MAB had the power to revoke a mineral agreement duly entered into by the DENR Secretary,
ratiocinating that there was no provision giving the POA and MAB the concurrent power to manage or develop mineral resources.
The MAB further held that the power to cancel or revoke a mineral agreement was exclusively lodged with the DENR Secretary;
that a petition for cancellation is not a mining dispute under the exclusive jurisdiction of the POA pursuant to Sec. 77 of RA 7942;
and that the POA could only adjudicate claims or contests during the MPSA application and not when the claims and leases were
already granted and subsisting.

Moreover, the MAB held that there was no abandonment by Macroasia because the DENR Secretary had not decided to
release Macroasia from its obligations. The Secretary may choose not to release a contractor from its obligations on grounds of
public interest. Thus, through its said resolution, the MAB rendered its disposition, as follows:

WHEREFORE, premises considered, the assailed Decision of October 24, 2000 is hereby VACATED. The
seven (7) mining lease contracts of Macroasia Corporation (formerly Infanta Mineral & Industrial Corporation)
are DECLARED SUBSISTING prior to their expirations without prejudice to any Decision or Order that the
Secretary may render on the same. NO PREFERENTIAL RIGHT over the same mining claims is accorded to
Blue Ridge Mineral Corporation or Celestial Nickel Mining Exploration Corporation also without prejudice to
the determination by the Secretary over the matter at the proper time.[23]

After the issuance of the MAB Resolution, Celestial and Blue Ridge went through divergent paths in their quest to protect
their individual interests.

On January 10, 2005, Celestial assailed the November 26, 2004 MAB Resolution before the CA in a petition for
review[24] under Rule 43 of the Rules of Court. The petition entitled Celestial Nickel Mining Exploration Corporation v. Macroasia
Corporation, et al. was docketed as CA-G.R. SP No. 87931.

On the other hand, Blue Ridge first filed a Motion for Reconsideration[25] which was denied.[26] On August 26, 2005,
Blue Ridge questioned the MABs November 26, 2004 and July 12, 2005 Resolutions before the CA in a petition for
review[27] entitled Blue Ridge Mineral Corporation v. Mines Adjudication Board, et al. docketed as CA-G.R. SP No. 90828.

CA-G.R. SP No. 87931 filed by Celestial was heard by the 12th Division of the CA; while Blue Ridges CA-G.R. SP No.
90828 was heard by the Special 10th Division. Ironically, the two divisions rendered two (2) diametrically opposing decisions.

The Ruling of the Court of Appeals Twelfth Division

On April 15, 2005, in CA-G.R. SP No. 87931, the CA 12th Division affirmed the November 26, 2004 MAB Resolution
which declared Macroasias seven mining lease contracts as subsisting; rejected Blue Ridges claim for preferential right over said
mining claims; and upheld the exclusive authority of the DENR Secretary to approve, cancel, and revoke mineral agreements. The
CA also denied Celestials Motion for Reconsideration[28] of the assailed August 3, 2005 Resolution.[29]

Hence, Celestial filed its Petition for Review on Certiorari[30] docketed as G.R. No. 169080, before this Court.

The Ruling of the Court of Appeals Special Tenth Division


On May 18, 2006, the CA Special 10th Division in CA-G.R. SP No. 90828 granted Blue Ridges petition; reversed and
set aside the November 26, 2004 and July 12, 2005 Resolutions of the MAB; and reinstated the October 24, 2000 Decision in MAB
Case Nos. 056-97 and 057-97. The Special Tenth Division canceled Macroasias lease contracts; granted Blue Ridge prior and
preferential rights; and treated the cancellation of a mining lease agreement as a mining dispute within the exclusive jurisdiction of
the POA under Sec. 77 of RA 7942, explaining that the power to resolve mining disputes, which is the greater power, necessarily
includes the lesser power to cancel mining agreements.

On February 20, 2006, Celestial filed a Most Urgent Motion for Issuance of a Temporary Restraining Order/Preliminary
Prohibitory Injunction/Mandatory Injunction[31] to defer and preclude the issuance of MPSA to Macroasia by the MGB and the
DENR Secretary. We denied this motion in our February 22, 2006 Resolution.[32]

Upon inquiry with the DENR, Blue Ridge discovered that sometime in December 2005 two MPSAs, duly approved and
signed by the DENR Secretary, had been issued in favor of Macroasia. Thus, we have the instant Petition for Certiorari[33]filed
by Blue Ridge docketed as G.R. No. 172936 under Rule 65, seeking to invalidate the two MPSAs issued to Macroasia.

In the meantime, on June 7, 2006, Celestial filed its Motion for Partial Reconsideration [34] of the May 18, 2006 CA
Decision in CA-G.R. SP No. 90828, while Macroasia filed its motion for reconsideration of the same CA decision on July 7,
2006. The motions were denied in the assailed January 19, 2007 CA Resolution. Hence, on March 8, 2007, Celestial filed the third
petition[35] docketed as G.R. No. 176226, assailing the CAs May 18, 2006 Decision and January 19, 2007 Resolution, insofar as
these granted Blue Ridges prior and preferential rights. While on March 9, 2007, Macroasia filed the fourth petition [36] docketed
as G.R. No. 176319, also assailing the CAs May 18, 2006 Decision and January 19, 2007 Resolution.

The Issues

In G.R. No. 169080, petitioner Celestial raises the following issues for our consideration:

(1) Whether or not Macroasia, for reasons of public policy is estopped from assailing the alleged lack of
jurisdiction of the Panel of Arbitrators and the Mines Adjudication Board only after receiving an adverse
judgment therefrom? [sic]

(2) Whether or not it is only the Secretary of the DENR who has the jurisdiction to cancel mining contracts and
privileges? [sic]

(3) Whether or not a petition for the cancellation of a mining lease contract or privilege is a mining dispute
within the meaning of the law? [sic]
(4) Whether or not Infantas (Macroasia) mining lease contract areas were deemed abandoned warranting the
cancellation of the lease contracts and the opening of the areas to other qualified applicants? [sic]
(5) Whether or not Macroasia/Infanta had lost its right to participate in this case after it failed to seasonably
file its appeal and after its lease contracts had been declared abandoned and expired without having been
renewed by the government? [sic]

(6) Whether or not Celestial has the preferential right to apply for the 23 DE LARA claims which were included
in Infantas (Macroasia) expired lease contract (LLC-V-941) and the other areas declared as lapsed or
abandoned by MGB-Region 4 and the Panel of Arbitrators?[37][sic]

In G.R. No. 172936, petitioner Blue Ridge raises the following grounds for the allowance of the petition:

At the outset, the instant petition must be given due course and taken cognizance of by the Honorable Court
considering that exceptional and compelling circumstances justify the availment of the instant petition and the
call for the exercise of the Honorable Courts primary jurisdiction.

A. The exploration, development and utilization of minerals, petroleum and other mineral oils are imbued with
public interest. The action of then Secretary Defensor, maintained and continued by public respondent
Secretary Reyes, was tainted with grave abuse of discretion, has far-reaching consequences because of the
magnitude of the effect created thereby.
B. The issues in the instant petition have already been put to fore by Celestial with the First Division of the
Honorable Court, and hence, this circumstance justifies the cognizance by the Honorable Court of the instant
petition.

II

It was grave abuse of discretion amounting to lack and/or excess of jurisdiction for then Secretary Defensor to
have issued the subject MPSAs in favor of private respondent Macroasia, considering that:

A. Non-compliance of the mandatory requirements by private respondent Macroasia prior to approval of the
subject MPSAs should have precluded then Secretary Defensor from approving subject MPSAs.

B. Petitioner Blue Ridge has the prior and preferential right to file its mining application over the mining claims
covered by the subject MPSAs, pursuant to the Decision dated 24 October 2000 of the Board and as
affirmed by the Decision dated 18 May 2006 of the Court of Appeals in CA-G.R. SP No. 90828.[38]
In G.R. No. 176226, petitioner Celestial ascribes the following errors to the CA for our consideration:

(1) That in reinstating and adopting as its own the Decision of the Mine Adjudication Board affirming the
abandonment and cancellation of the mining areas/claims of Macroasia (Infanta) but awarding the prior or
preferential rights to Blue Ridge, the Hon. Court of Appeals had decided a question of substance in a way not
in accord with the Law (RA 7942) or with the applicable decisions of the Supreme Court; in other words, errors
of law had been committed by the Hon. Court of Appeals in granting preferential rights to Blue Ridge;

(2) That the Hon. Court of Appeals has so far departed from the accepted and usual course of judicial
proceedings or so far sanctioned such departure by the Mines Adjudication Board in its Decision of May 18,
2006 and Resolution of January 19, 2007 because:

(A) The findings of fact of the Hon. Court of Appeals are contradictory or inconsistent with
the findings of the Panel of Arbitrators;

(B) There is grave abuse of discretion on the part of the Hon. Court of Appeals in its
appreciation of the facts, the evidence and the law thereby leading it to make the erroneous conclusion
that Blue Ridge, not Celestial, is entitled to the Award of prior/preferential rights over the mining
areas declared as abandoned by Macroasia;

(C) There is likewise, a grave abuse of discretion on the part of the Hon. Court of Appeals
in that the said Court did not even consider some of the issues raised by Celestial;

(D) That the findings of the Hon. Court of Appeals are mere conclusions not supported by
substantial evidence and without citation of the specific evidence upon which they are based; they
were arrived at arbitrarily or in disregard of contradiction of the evidence on record and findings of
the Panel of Arbitrators in the Resolution of September 1, 1997;

(E) That the findings of the Hon. Court of Appeals are premised on the absence of evidence
but such findings are contradicted by the evidence on record and are violative of the provisions of
RA 7942 and its Implementing Rules and Regulations.[39]

In G.R. No. 176319, petitioner Macroasia raises the following grounds for the allowance of the petition:
I.

The Court of Appeals (Special Tenth Division) should have dismissed the Petition of Blue Ridge outright since
the issues, facts and matters involved in the said Petition are identical to those which had already been
painstakingly passed upon, reviewed and resolved by the Court of Appeals Twelfth Division in CA-G.R. SP
No. 87931

II.

The Court of Appeals (Special Tenth Division) gravely erred in denying Macroasias Motion to Inhibit
Associate Justice Rosmari Carandang from hearing and deciding the Petition

III.
There were no factual nor legal bases for the Court of Appeals to rule that Macroasia had waived its right to
question the jurisdiction of the Mines Adjudication Board

IV.

Republic Act No. 7942 contains provisions which unequivocally indicate that only the Secretary of the
Department of Environment and Natural Resources has the power and authority to cancel mining lease
agreements

V.

The Court of Appeals (Special Tenth Division) gravely erred in perfunctorily transferring Macroasias mining
lease agreements to Blue Ridge without observing the required procedure nor providing any basis therefor [40]

The Courts Ruling

The petitions under G.R. Nos. 169080, 172936, and 176226 are bereft of merit, while the petition under G.R. No. 176319
is meritorious.

The pith of the controversy, upon which the other issues are hinged is, who has authority and jurisdiction to cancel
existing mineral agreements under RA 7942 in relation to PD 463 and pertinent rules and regulations.

G.R. Nos. 169080, 176226 and 176319

We will jointly tackle G.R. Nos. 169080, 176266, and 176319 as the issues and arguments of these three are inextricably
intertwined.

Core Issue: Jurisdiction over Cancellation of Mineral Agreements

Petitioner Celestial maintains that while the jurisdiction to approve mining lease contracts or mineral agreements is
conferred on the DENR Secretary, Sec. 77(a) of RA 7942 by implication granted to the POA and MAB the authority to cancel
existing mining lease contracts or mineral agreements.

On the other hand, respondent Macroasia strongly asserts that it is the DENR Secretary who has the exclusive and primary
jurisdiction to grant and cancel existing mining lease contracts; thus, the POA and MAB have no jurisdiction to cancel much less
to grant any preferential rights to other mining firms.

Before we resolve this core issue of jurisdiction over cancellation of mining lease contracts, we first need to look back at
previous mining laws pertinent to this issue.

Under PD 463, The Mineral Resources Development Decree of 1974, which took effect on May 17, 1974, applications
for lease of mining claims were required to be filed with the Director of the Bureau of Mines, within two (2) days from the date of
their recording.[41] Sec. 40 of PD 463 provided that if no adverse claim was filed within (15) days after the first date of publication,
it was conclusively presumed that no adverse claim existed and thereafter no objection from third parties to the grant of the lease
could be heard, except protests pending at the time of publication. The Secretary would then approve and issue the corresponding
mining lease contract. In case of any protest or adverse claim relating to any mining claim and lease application, Secs. 48 and 50
of PD 463 prescribed the procedure. Under Sec. 48, the protest should be filed with the Bureau of Mines. Under Sec. 50, any party
not satisfied with the decision or order of the Director could, within five (5) days from receipt of the decision or order, appeal to
the Secretary. The decisions of the Secretary were likewise appealable within five (5) days from receipts by the affected party to
the President of the Philippines whose decision shall be final and executory. PD 463 was, however, silent as to who was authorized
to cancel the mineral agreements.

On July 10, 1987, President Corazon C. Aquino issued Executive Order No. (EO) 211. Under Sec. 2 of EO 211, the
processing, evaluation, and approval of all mining applications, declarations of locations, operating agreements, and service
contracts were governed by PD 463, as amended. EO 211 likewise did not contain any provision on the authority to cancel operating
agreements and service contracts.

On July 25, 1987, EO 279 was issued by President Aquino. It authorized the DENR Secretary to negotiate and enter into,
for and in behalf of the Government, joint venture, co-production, or production-sharing agreements for the exploration,
development, and utilization of mineral resources with any Filipino citizen, corporation, or association, at least 60% of whose
capital was owned by Filipino citizens.[42] The contract or agreement was subject to the approval of the President. [43] With respect
to contracts of foreign-owned corporations or foreign investors involving either technical or financial assistance for large-scale
exploration, development, and utilization of minerals, the DENR Secretary could recommend approval of said contracts to the
President.[44] EO 279 provided that PD 463 and its implementing rules and regulations, which were not inconsistent with EO 279,
continued in force and effect.[45] Again, EO 279 was silent on the authority to cancel mineral agreements.

RA 7942, The Philippine Mining Act of 1995 enacted on March 3, 1995, repealed the provisions of PD 463 inconsistent
with RA 7942. Unlike PD 463, where the application was filed with the Bureau of Mines Director, the applications for mineral
agreements are now required to be filed with the Regional Director as provided by Sec. 29 of RA 7942. The proper filing gave the
proponent the prior right to be approved by the Secretary and thereafter to be submitted to the President. The President shall provide
a list to Congress of every approved mineral agreement within 30 days from its approval by the Secretary. Again, RA 7942 is silent
on who has authority to cancel the agreement.

Compared to PD 463 where disputes were decided by the Bureau of Mines Director whose decisions were appealable to
the DENR Secretary and then to the President, RA 7942 now provides for the creation of quasi-judicial bodies (POA and MAB)
that would have jurisdiction over conflicts arising from the applications and mineral agreements. Secs. 77, 78, and 79 lay down the
procedure, thus:

SEC. 77. Panel of Arbitrators.There shall be a panel of arbitrators in the regional office of the Department
composed of three (3) members, two (2) of whom must be members of the Philippine Bar in good standing and
one [1] licensed mining engineer or a professional in a related field, and duly designated by the Secretary as
recommended by the Mines and Geosciences Bureau Director. Those designated as members of the panel shall
serve as such in addition to their work in the Department without receiving any additional compensation. As
much as practicable, said members shall come from the different bureaus of the Department in the region. The
presiding officer thereof shall be selected by the drawing of lots. His tenure as presiding officer shall be on a
yearly basis. The members of the panel shall perform their duties and obligations in hearing and deciding cases
until their designation is withdrawn or revoked by the Secretary. Within thirty (30) working days, after the
submission of the case by the parties for decision, the panel shall have exclusive and original jurisdiction to
hear and decide on the following:

(a) Disputes involving rights to mining areas;

(b) Disputes involving mineral agreements or permits;

(c) Disputes involving surface owners, occupants and claimholders/concessionaires; and

(d) Disputes pending before the Bureau and the Department at the date of the effectivity of this Act.

SEC. 78. Appellate Jurisdiction.The decision or order of the panel of arbitrators may be appealed by the party
not satisfied thereto to the Mines Adjudication Board within fifteen (15) days from receipt thereof which must
decide the case within thirty (30) days from submission thereof for decision.

SEC. 79. Mines Adjudication Board.The Mines Adjudication Board shall be composed of three (3) members.
The Secretary shall be the chairman with the Director of the Mines and Geosciences Bureau and the
Undersecretary for Operations of the Department as members thereof.

xxxx

A petition for review by certiorari and question of law may be filed by the aggrieved party with the Supreme
Court within thirty (30) days from receipt of the order or decision of the Board.

RA 7942 is also silent as to who is empowered to cancel existing lease contracts and mineral agreements.

Meanwhile, in Southeast Mindanao Gold Mining Corp. v. MAB, we explained that the decision of the MAB can first be
appealed, via a petition for review, to the CA before elevating the case to this Court.[46]

After a scrutiny of the provisions of PD 463, EO 211, EO 279, RA 7942 and its implementing rules and regulations,
executive issuances, and case law, we rule that the DENR Secretary, not the POA, has the jurisdiction to cancel existing mineral
lease contracts or mineral agreements based on the following reasons:
1. The power of the DENR Secretary to cancel mineral agreements emanates from his administrative authority,
supervision, management, and control over mineral resources under Chapter I, Title XIV of Book IV of the Revised Administrative
Code of 1987, viz:

Chapter 1General Provisions

Section 1. Declaration of Policy.(1) The State shall ensure, for the benefit of the Filipino people, the full
exploration and development as well as the judicious disposition, utilization, management, renewal and
conservation of the countrys forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other
natural resources x x x

Sec. 2. Mandate.(1) The Department of Environment and Natural Resources shall be primarily
responsible for the implementation of the foregoing policy. (2) It shall, subject to law and higher
authority, be in charge of carrying out the States constitutional mandate to control and supervise the
exploration, development, utilization, and conservation of the countrys natural resources.

xxxx

Sec. 4. Powers and Functions.The Department shall:

xxxx

(2) Formulate, implement and supervise the implementation of the governments policies, plans, and
programs pertaining to the management, conservation, development, use and replenishment of the
countrys natural resources;

xxxx

(4) Exercise supervision and control over forest lands, alienable and disposable public lands, mineral
resources x x x

xxxx

(12) Regulate the development, disposition, extraction, exploration and use of the countrys forest, land,
water and mineral resources;

(13) Assume responsibility for the assessment, development, protection, licensing and
regulation as provided for by law, where applicable, of all energy and natural resources; the regulation and
monitoring of service contractors, licensees, lessees, and permit for the extraction, exploration,
development and use of natural resources products; x x x

xxxx

(15) Exercise exclusive jurisdiction on the management and disposition of all lands of the public
domain x x x

Chapter 2The Department Proper

xxxx

Sec. 8. The Secretary.The Secretary shall:

xxxx

(3) Promulgate rules, regulations and other issuances necessary in carrying out the
Departments mandate, objectives, policies, plans, programs and projects.

(4) Exercise supervision and control over all functions and activities of the Department;

(5) Delegate authority for the performance of any administrative or substantive function to
subordinate officials of the Department x x x (Emphasis supplied.)
It is the DENR, through the Secretary, that manages, supervises, and regulates the use and development of all mineral
resources of the country. It has exclusive jurisdiction over the management of all lands of public domain, which covers mineral
resources and deposits from said lands. It has the power to oversee, supervise, and police our natural resources which include
mineral resources. Derived from the broad and explicit powers of the DENR and its Secretary under the Administrative Code of
1987 is the power to approve mineral agreements and necessarily to cancel or cause to cancel said agreements.

2. RA 7942 confers to the DENR Secretary specific authority over mineral resources.

Secs. 8 and 29 of RA 7942 pertinently provide:

SEC. 8. Authority of the Department.The Department shall be the primary government agency responsible for
the conservation, management, development, and proper use of the States mineral resources including those in
reservations, watershed areas, and lands of the public domain. The Secretary shall have the authority to
enter into mineral agreements on behalf of the Government upon the recommendation of the Director,
promulgate such rules and regulations as may be necessary to implement the intent and provisions of this Act.

SEC. 29. Filing and approval of Mineral Agreements.x x x.

The filing of a proposal for a mineral agreement shall give the proponent the prior right to areas covered by the
same. The proposed mineral agreement will be approved by the Secretary and copies thereof shall be
submitted to the President. Thereafter, the President shall provide a list to Congress of every approved mineral
agreement within thirty (30) days from its approval by the Secretary. (Emphasis supplied.)

Sec. 29 is a carry over of Sec. 40 of PD 463 which granted jurisdiction to the DENR Secretary to approve mining lease
contracts on behalf of the government, thus:

SEC. 40. Issuance of Mining Lease Contract.If no adverse claim is filed within fifteen (15) days after
the first date of publication, it shall be conclusively presumed that no such adverse claim exists and thereafter
no objection from third parties to the grant of the lease shall be heard, except protest pending at the time of
publication, and the Secretary shall approve and issue the corresponding mining lease x x x.

To enforce PD 463, the CMAO containing the rules and regulations implementing PD 463 was issued. Sec. 44 of the CMAO
provides:

SEC. 44. Procedure for Cancellation.Before any mining lease contract is cancelled for any cause enumerated
in Section 43 above, the mining lessee shall first be notified in writing of such cause or causes, and shall be
given an opportunity to be heard, and to show cause why the lease shall not be cancelled.

If, upon investigation, the Secretary shall find the lessee to be in default, the former may warn the lessee,
suspend his operations or cancel the lease contract (emphasis supplied).
Sec. 4 of EO 279 provided that the provisions of PD 463 and its implementing rules and regulations, not inconsistent
with the executive order, continue in force and effect.

When RA 7942 took effect on March 3, 1995, there was no provision on who could cancel mineral agreements. However,
since the aforequoted Sec. 44 of the CMAO implementing PD 463 was not repealed by RA 7942 and DENR AO 96-40, not being
contrary to any of the provisions in them, then it follows that Sec. 44 serves as basis for the DENR Secretarys authority to cancel
mineral agreements.

Since the DENR Secretary had the power to approve and cancel mineral agreements under PD 463, and the power to
cancel them under the CMAO implementing PD 463, EO 211, and EO 279, then there was no recall of the power of the DENR
Secretary under RA 7942. Historically, the DENR Secretary has the express power to approve mineral agreements or contracts and
the implied power to cancel said agreements.

It is a well-established principle that in the interpretation of an ambiguous provision of law, the history of the enactment
of the law may be used as an extrinsic aid to determine the import of the legal provision or the law.[47] History of the enactment of
the statute constitutes prior laws on the same subject matter. Legislative history necessitates review of the origin, antecedents and
derivation of the law in question to discover the legislative purpose or intent.[48] It can be assumed that the new legislation has been
enacted as continuation of the existing legislative policy or as a new effort to perpetuate it or further advance it. [49]

We rule, therefore, that based on the grant of implied power to terminate mining or mineral contracts under previous laws
or executive issuances like PD 463, EO 211, and EO 279, RA 7942 should be construed as a continuation of the legislative intent
to authorize the DENR Secretary to cancel mineral agreements on account of violations of the terms and conditions thereof.

3. Under RA 7942, the power of control and supervision of the DENR Secretary over the MGB to cancel or recommend
cancellation of mineral rights clearly demonstrates the authority of the DENR Secretary to cancel or approve the cancellation of
mineral agreements.

Under Sec. 9 of RA 7942, the MGB was given the power of direct supervision of mineral lands and resources, thus:

Sec. 9. Authority of the Bureau.The Bureau shall have direct charge in the administration and disposition
of mineral lands and mineral resources and shall undertake geological, mining, metallurgical, chemical,
and other researches as well as geological and mineral exploration surveys. The Director shall
recommend to the Secretary the granting of mineral agreements to duly qualified persons and shall
monitor the compliance by the contractor of the terms and conditions of the mineral agreements. The
Bureau may confiscate surety, performance and guaranty bonds posted through an order to be promulgated by
the Director. The Director may deputize, when necessary, any member or unit of the Philippine National Police,
barangay, duly registered nongovernmental organization (NGO) or any qualified person to police all mining
activities. (Emphasis supplied.)

Corollary to the power of the MGB Director to recommend approval of mineral agreements is his power to cancel or
recommend cancellation of mining rights covered by said agreements under Sec. 7 of DENR AO 96-40, containing the revised
Implementing Rules and Regulations of RA 7942. Sec. 7 reads:

Sec. 7. Organization and Authority of the Bureau.

xxxx

The Bureau shall have the following authority, among others:

a. To have direct charge in the administration and disposition of mineral land and mineral resources;

xxxx

d. To recommend to the Secretary the granting of mineral agreements or to endorse to the Secretary for action
by the President the grant of FTAAs [Financial and Technical Assistance Agreements], in favor of qualified
persons and to monitor compliance by the Contractor with the terms and conditions of the mineral agreements
and FTAAs.

e. To cancel or to recommend cancellation after due process, mining rights, mining applications and
mining claims for non-compliance with pertinent laws, rules and regulations.

It is explicit from the foregoing provision that the DENR Secretary has the authority to cancel mineral agreements based
on the recommendation of the MGB Director. As a matter of fact, the power to cancel mining rights can even be delegated by the
DENR Secretary to the MGB Director. Clearly, it is the Secretary, not the POA, that has authority and jurisdiction over cancellation
of existing mining contracts or mineral agreements.

4. The DENR Secretarys power to cancel mining rights or agreements through the MGB can be inferred from Sec. 230,
Chapter XXIV of DENR AO 96-40 on cancellation, revocation, and termination of a permit/mineral agreement/FTAA. Sec. 230
provides:

Section 230. Grounds


The following grounds for cancellation revocation and termination of a Mining Permit Mineral
Agreement/FTAA.

a. Violation of any of the terms and conditions of the Permits or Agreements;

b. Nonpayment of taxes and fees due the government for two (2) consecutive years; and

c. Falsehood or omission of facts in the application for exploration [or Mining] Permit Mineral
Agreement/FTAA or other permits which may later, change or affect substantially the facts set forth in
said statements.

Though Sec. 230 is silent as to who can order the cancellation, revocation, and termination of a permit/mineral agreement/FTAA,
it has to be correlated with the power of the MGB under Sec. 7 of AO 96-40 to cancel or to recommend cancellation, after due
process, mining rights, mining applications and mining claims for noncompliance with pertinent laws, rules and regulations. As
the MGB is under the supervision of the DENR Secretary, then the logical conclusion is that it is the DENR Secretary who can
cancel the mineral agreements and not the POA nor the MAB.

5. Celestial and Blue Ridge are not unaware of the stipulations in the Mining Lease Contract Nos. V-1050 and MRD-52,[50] the
cancellation of which they sought from the POA. It is clear from said lease contracts that the parties are the Republic of
the Philippines represented by the Secretary of Agriculture and Natural Resources (now DENR Secretary) as lessor, and Infanta
(Macroasia) as lessee. Paragraph 18 of said lease contracts provides:

Whenever the LESSEE fails to comply with any provision of [PD 463, and] Commonwealth Acts Nos. 137,
466 and 470, [both as amended,] and/or the rules and regulations promulgated thereunder, or any of the
covenants therein, the LESSOR may declare this lease cancelledand, after having given thirty (30) days
notice in writing to the LESSEE, may enter and take possession of the said premises, and said lessee shall be
liable for all unpaid rentals, royalties and taxes due the Government on the lease up to the time of the forfeiture
or cancellation, in which event, the LESSEE hereby covenants and agrees to give up the possession of the
property leased. (Emphasis supplied.)

Thus, the government represented by the then Secretary of Agriculture and Natural Resources (now the DENR Secretary) has the
power to cancel the lease contracts for violations of existing laws, rules and regulations and the terms and conditions of the
contracts. Celestial and Blue Ridge are now estopped from challenging the power and authority of the DENR Secretary to cancel
mineral agreements.

However, Celestial and Blue Ridge insist that the power to cancel mineral agreements is also lodged with the POA under the
explicit provisions of Sec. 77 of RA 7942.

This postulation is incorrect.

Sec. 77 of RA 7942 lays down the jurisdiction of POA, to wit:

Within thirty (30) days, after the submission of the case by the parties for the decision, the panel shall have
exclusive and original jurisdiction to hear and decide the following:

(a) Disputes involving rights to mining areas

(b) Disputes involving mineral agreements or permits

The phrase disputes involving rights to mining areas refers to any adverse claim, protest, or opposition to an application
for mineral agreement. The POA therefore has the jurisdiction to resolve any adverse claim, protest, or opposition to a pending
application for a mineral agreement filed with the concerned Regional Office of the MGB. This is clear from Secs. 38 and 41 of
DENR AO 96-40, which provide:

Sec. 38.
xxxx

Within thirty (30) calendar days from the last date of publication/posting/radio announcements, the
authorized officer(s) of the concerned office(s) shall issue a certification(s) that the publication/posting/radio
announcement have been complied with. Any adverse claim, protest or opposition shall be filed directly,
within thirty (30) calendar days from the last date of publication/posting/radio announcement, with the
concerned Regional Office or through any concerned PENRO or CENRO for filing in the concerned
Regional Office for purposes of its resolution by the Panel of Arbitrators pursuant to the provisions of
this Act and these implementing rules and regulations. Upon final resolution of any adverse claim,
protest or opposition, the Panel of Arbitrators shall likewise issue a certification to that effect within five
(5) working days from the date of finality of resolution thereof. Where there is no adverse claim, protest
or opposition, the Panel of Arbitrators shall likewise issue a Certification to that effect within five
working days therefrom.

xxxx

No Mineral Agreement shall be approved unless the requirements under this Section are fully
complied with and any adverse claim/protest/opposition is finally resolved by the Panel of Arbitrators.

Sec. 41.
xxxx

Within fifteen (15) working days from the receipt of the Certification issued by the Panel
of Arbitrators as provided in Section 38 hereof, the concerned Regional Director shall initially evaluate
the Mineral Agreement applications in areas outside Mineral reservations. He/She shall thereafter
endorse his/her findings to the Bureau for further evaluation by the Director within fifteen (15) working
days from receipt of forwarded documents. Thereafter, the Director shall endorse the same to the
secretary for consideration/approval within fifteen working days from receipt of such endorsement.

In case of Mineral Agreement applications in areas with Mineral Reservations, within fifteen (15)
working days from receipt of the Certification issued by the Panel of Arbitrators as provided for in
Section 38 hereof, the same shall be evaluated and endorsed by the Director to the Secretary for
consideration/approval within fifteen days from receipt of such endorsement. (Emphasis supplied.)

It has been made clear from the aforecited provisions that the disputes involving rights to mining areas under Sec. 77(a)
specifically refer only to those disputes relative to the applications for a mineral agreement or conferment of mining rights.
The jurisdiction of the POA over adverse claims, protest, or oppositions to a mining right application is further elucidated
by Secs. 219 and 43 of DENR AO 95-936, which read:

Sec. 219. Filing of Adverse Claims/Conflicts/Oppositions.Notwithstanding the provisions of Sections


28, 43 and 57 above, any adverse claim, protest or opposition specified in said sections may also be filed
directly with the Panel of Arbitrators within the concerned periods for filing such claim, protest or opposition
as specified in said Sections.

Sec. 43. Publication/Posting of Mineral Agreement Application.


xxxx

The Regional Director or concerned Regional Director shall also cause the posting of the application on the
bulletin boards of the Bureau, concerned Regional office(s) and in the concerned province(s) and
municipality(ies), copy furnished the barangays where the proposed contract area is located once a week for
two (2) consecutive weeks in a language generally understood in the locality. After forty-five (45) days from
the last date of publication/posting has been made and no adverse claim, protest or opposition was filed within
the said forty-five (45) days, the concerned offices shall issue a certification that publication/posting has been
made and that no adverse claim, protest or opposition of whatever nature has been filed. On the other hand,
if there be any adverse claim, protest or opposition, the same shall be filed within forty-five (45) days
from the last date of publication/posting, with the Regional Offices concerned, or through the
Departments Community Environment and Natural Resources Officers (CENRO) or Provincial
Environment and Natural Resources Officers (PENRO), to be filed at the Regional Office for resolution
of the Panel of Arbitrators. However previously published valid and subsisting mining claims are exempted
from posted/posting required under this Section.

No mineral agreement shall be approved unless the requirements under this section are fully
complied with and any opposition/adverse claim is dealt with in writing by the Director and resolved by
the Panel of Arbitrators. (Emphasis supplied.)

These provisions lead us to conclude that the power of the POA to resolve any adverse claim, opposition, or protest
relative to mining rights under Sec. 77(a) of RA 7942 is confined only to adverse claims, conflicts and oppositions relating
to applications for the grant of mineral rights. POAs jurisdiction is confined only to resolutions of such adverse claims, conflicts
and oppositions and it has no authority to approve or reject said applications. Such power is vested in the DENR Secretary upon
recommendation of the MGB Director. Clearly, POAs jurisdiction over disputes involving rights to mining areas has nothing to do
with the cancellation of existing mineral agreements.

On the other hand, Celestial and Blue Ridge contend that POA has jurisdiction over their petitions for the cancellation of
Macroasias lease agreements banking on POAs jurisdiction over disputes involving mineral agreements or permits under Sec. 77
(b) of RA 7942.

Such position is bereft of merit.

As earlier discussed, the DENR Secretary, by virtue of his powers as administrative head of his department in charge of
the management and supervision of the natural resources of the country under the 1987 Administrative Code, RA 7942, and other
laws, rules, and regulations, can cancel a mineral agreement for violation of its terms, even without a petition or request filed for
its cancellation, provided there is compliance with due process. Since the cancellation of the mineral agreement is approved by the
DENR Secretary, then the recourse of the contractor is to elevate the matter to the OP pursuant to AO 18, Series of 1987 but not
with the POA.

Matched with the legal provisions empowering the DENR Secretary to cancel a mineral agreement is Sec. 77 (b) of RA
7942 which grants POA jurisdiction over disputes involving mineral agreements.

A dispute is defined as a conflict or controversy; a conflict of claims or rights; an assertion of a right, claim or demand on one side;
met by contrary claims or allegations on the other.[51] It is synonymous to a cause of action which is an act or omission by which a
party violates a right of another.[52]

A petition or complaint originating from a dispute can be filed or initiated only by a real party-in-interest. The rules of court define
a real party-in-interest as the party who stands to be benefited or injured by the judgment in the suit or the party entitled to the
avails of the suit.[53] Every action, therefore, can only be prosecuted in the name of the real party-in-interest.[54] It has been explained
that a real party-in-interest plaintiff is one who has a legal right, while a real party-in-interest-defendant is one who has a correlative
legal obligation whose act or omission violates the legal right of the former. [55]

On the other hand, interest means material interest, an interest in issue and to be affected by the decree, as distinguished from mere
interest in the question involved, or a mere incidental interest. It is settled in this jurisdiction that one having no right or interest to
protect cannot invoke the jurisdiction of the court as a party-plaintiff in an action.[56] Real interest is defined as a present substantial
interest, as distinguished from a mere expectancy, or a future, contingent, subordinate or consequential interest. [57]

From the foregoing, a petition for the cancellation of an existing mineral agreement covering an area applied for by an applicant
based on the alleged violation of any of the terms thereof, is not a dispute involving a mineral agreement under Sec. 77 (b) of RA
7942. It does not pertain to a violation by a party of the right of another. The applicant is not a real party-in-interest as he does not
have a material or substantial interest in the mineral agreement but only a prospective or expectant right or interest in the mining
area. He has no legal right to such mining claim and hence no dispute can arise between the applicant and the parties to the mineral
agreement. The court rules therefore that a petition for cancellation of a mineral agreement anchored on the breach thereof even if
filed by an applicant to a mining claim, like Celestial and Blue Ridge, falls within the jurisdiction of the DENR Secretary and not
POA. Such petition is excluded from the coverage of the POAs jurisdiction over disputes involving mineral agreements under Sec.
77 (b) of RA 7942.

Macroasia not estopped from raising the issue of jurisdiction on appeal


On the related issue of estoppel, petitioner Celestial argues that Macroasia is estopped from raising and questioning the
issue of the jurisdiction of the POA and MAB over the petition for cancellation of its mining lease contracts, when Macroasia raised
it only in its Supplemental Motion for Reconsideration.

We rule that the principle of estoppel does not apply.

Indeed, Macroasia was not the one that initiated the instant case before the POA, and thus was not the one that invoked
the jurisdiction of the POA. Hence, on appeal, Macroasia is not precluded from raising the issue of jurisdiction as it may be invoked
even on appeal.[58] As a matter of fact, a party can raise the issue of jurisdiction at any stage of the proceedings.

Petitioner Celestials reliance on Villela v. Gozun[59] to support the contention that the POA has jurisdiction to hear and
decide a petition to cancel existing mining lease contracts, is misplaced. In said case, we dismissed the petition on the ground of
non-exhaustion of administrative remedies and disregarded judicial hierarchy as no compelling reason was shown to warrant
otherwise. While we pointed out the authority of the POA, there was no categorical pronouncement on the jurisdictional issue.

No valid pronouncement of abandonment due to lack of jurisdiction over petition to cancel

As we are not a trier of facts, we need not make any finding on the various investigations done by the MGB and MAB
on the issue of Macroasias non-compliance with its work obligations and nonpayment of taxes and fees. Verily, the law does not
impose automatic cancellation of an existing mining lease contract, as it is a question of fact which must be determined by the
MGB which can recommend the cancellation of the mineral or lease agreements to the DENR Secretary. Be that as it may, since
the POA and MAB have no jurisdiction over the petition for cancellation of existing mining lease contracts of Macroasia, they
could not have made any binding pronouncement that Macroasia had indeed abandoned the subject mining claims. Besides, it is
the DENR Secretary who has the authority to cancel Macroasias existing mining lease contracts whether on grounds of
abandonment or any valid grounds for cancellation.

Decision in CA-G.R. SP No. 90828 not in accord with the law

With our resolution of the issue on the lack of jurisdiction of the POA and the MAB over petitions to cancel existing
mining lease contracts or mineral agreements, it is thus clear that the May 18, 2006 Decision in CA-G.R. SP No. 90828 must be
nullified for being not in accord with the law and the April 15, 2005 Decision in CA-G.R. SP No. 87931 must be upheld.

Notwithstanding the nullification of the May 18, 2006 Decision of the Special Tenth Division in CA-G.R. SP No. 90828,
the rendition of two conflicting decisions of the two CA Divisions over the same challenged resolutions of the MAB should be
avoided in the future as this is anathema to stability of judicial decisions and orderly administration of justice.

The chronology of events reveals the following:

1. January 10, 2005 petitioner Celestial filed its petition docketed as CA-G.R. SP No. 87931 with the CA.

2. April 15, 2005 the CA through its Twelfth Division rendered its Decision in CA-G.R. SP No. 87931 affirming the
November 26, 2004 MAB Resolution.

3. July 12, 2005 respondent Blue Ridge filed its petition docketed as CA-G.R. SP No. 90828 with the CA. It is clear that
the Blue Ridge petition was filed with the CA three months after the decision in CA-G.R. SP No. 87931 was promulgated.

4. May 18, 2006 the CA through its Special Tenth Division rendered its Decision setting aside the November 26,
2004 and July 12, 2005 Resolutions of the MAB and reinstating the October 24, 2000 MAB Decision.

From these facts, the CA Special Tenth Division should have ordered the consolidation of the petition in CA-G.R. SP
No. 90828 by CA-G.R. SP No. 87931 pursuant to the Internal Rules of the CA, the latter having the earlier docket number. Had it
done so, then the occurrence of the conflicting decisions could have been prevented. The CA Special Tenth Division should have
abided by our ruling in Nacuray v. NLRC, where we held, Consequently, a division cannot and should not review a case already
passed upon by another Division of this Court. It is only proper, to allow the case to take its rest after having attained finality. [60]

The CA should take the appropriate steps, including the adoption or amendment of the rules, to see to it that cases or
petitions arising from the same questioned decision, order, or resolution are consolidated to steer clear of contrary or opposing
decisions of the different CA Divisions and ensure that incidents of similar nature will not be replicated.
G.R. No. 172936

No showing that the DENR Secretary gravely abused his discretion

Now, going to the substance of the petition in G.R. No. 172936. A scrutiny of the records shows that the DENR Secretary
did not gravely abuse his discretion in approving and signing MPSA Nos. 220-2005-IVB and 221-2005-IVB in favor of Macroasia.

Petitioner Blue Ridge anchors its rights on the May 18, 2006 Decision in CA-G.R. SP No. 90828, which we have
unfortunately struck down. Blue Ridges argument in assailing the approval and issuance of the subject MPSAs that it has been
accorded preferential right by the CA has no leg to stand on.

The October 24, 2000 MAB Decision, nullified by the subsequent November 26, 2004 Resolution, is unequivocal
that Blue Ridge was granted only prior and preferential rights to FILE its mining application over the same mining claims.[61]What
was accorded Blue Ridge was only the right to file the mining application but with no assurance that the application will be
recommended for approval by the MGB and finally approved by the DENR Secretary.

Moreover, a preferential right would at most be an inchoate right to be given priority in the grant of a mining agreement.
It has not yet been transformed into a legal and vested right unless approved by the MGB or DENR Secretary. Even if Blue Ridge
has a preferential right over the subject mining claims, it is still within the competence and discretion of the DENR Secretary to
grant mineral agreements to whomever he deems best to pursue the mining claims over and above the preferential status given
to Blue Ridge. Besides, being simply a preferential right, it is ineffective to dissolve the pre-existing or subsisting mining lease
contracts of Macroasia.

The DENR Secretary has full discretion in the grant of mineral agreements

Blue Ridge also argues that the Secretary gravely abused his discretion in approving the subject MPSAs without
Macroasia complying with the mandatory requirements for mineral agreement applications under Sec. 35 of DENR AO 96-
40.Petitioner specifically cited Sec. 36 of DENR AO 96-40 to the effect that no Mineral Agreement shall be approved unless the
requirements under this section are fully complied with and any adverse claim/protest/opposition thereto is finally resolved by the
Panel of Arbitrators. Moreover, Blue Ridge contends that the MPSAs were approved even prior to the issuance of the Compliance
Certificate[62] by the National Commission on Indigenous Peoples under the OP, which is a requisite pre-condition for the issuance
of an MPSA.

We are not persuaded.

Blue Ridge cites Sec. 38 (not Sec. 36) of DENR AO 96-40 as basis for claiming that then DENR Secretary Defensor
committed grave abuse of discretion in granting MPSA Nos. 220-2005-IVB and 221-2005-IVB to Macroasia. Petitioners
postulation cannot be entertained for the reason that the issuance of the mining agreements was not raised before the MGB Director
and DENR Secretary, nor was it amply presented before the CA. There is even a counter-charge that Blue Ridge has not complied
with the legal requirements for a mining application. The rule is established that questions raised for the first time on appeal before
this Court are not proper and have to be rejected. Furthermore, the resolution of these factual issues would relegate the Court to a
trier of facts. The Blue Ridge plea is hindered by the factual issue bar rule where factual questions are proscribed under Rule 65.
Lastly, there was no exhaustion of administrative remedies before the MGB and DENR. Thus, Blue Ridges petition must fail.

Primary jurisdiction of the DENR Secretary in determining whether to grant or not a mineral agreement

Verily, RA 7942, similar to PD 463, confers exclusive and primary jurisdiction on the DENR Secretary to approve
mineral agreements, which is purely an administrative function within the scope of his powers and authority. In exercising such
exclusive primary jurisdiction, the DENR Secretary, through the MGB, has the best competence to determine to whom mineral
agreements are granted. Settled is the rule that the courts will defer to the decisions of the administrative offices and agencies by
reason of their expertise and experience in the matters assigned to them pursuant to the doctrine of primary
jurisdiction. Administrative decisions on matter within the jurisdiction of administrative bodies are to be respected and can only be
set aside on proof of grave abuse of discretion, fraud, or error of law.[63] Unless it is shown that the then DENR Secretary has acted
in a wanton, whimsical, or oppressive manner, giving undue advantage to a party or for an illegal consideration and similar reasons,
this Court cannot look into or review the wisdom of the exercise of such discretion. Blue Ridge failed in this regard.
Delineation of powers and functions is accorded the three branches of government for the smooth functioning of the
different governmental services. We will not disturb nor interfere in the exercise of purely administrative functions of the executive
branch absent a clear showing of grave abuse of discretion.

Without a restraining order or injunction, litigation will not deter the DENR from exercising its functions

While it is true that the subject mining claims are under litigation, this does not preclude the DENR and its Secretary
from carrying out their functions and duties without a restraining order or an injunctive writ. Otherwise, public interest and public
service would unduly suffer by mere litigation of particular issues where government interests would be unduly affected. In the
instant case, it must be borne in mind that the government has a stake in the subject mining claims. Also, Macroasia had various
valid existing mining lease contracts over the subject mining lode claims issued by the DENR. Thus, Macroasia has an advantage
over Blue Ridge and Celestial insofar as the administrative aspect of pursuing the mineral agreements is concerned.

WHEREFORE, the petitions under G.R. Nos. 169080, 172936, and 176229 are DISMISSED for lack of merit, while
the petition under G.R. No. 176319 is hereby GRANTED. The assailed April 15, 2005 Decision and August 3, 2005Resolution of
the CA in CA-G.R. SP No. 87931 are hereby AFFIRMED IN TOTO. And the May 18, 2006 Decision and January 19, 2007
Resolution of the CA in CA-G.R. SP No. 90828 are hereby REVERSED and SET ASIDE. In view of the foregoing
considerations, we find no grave abuse of discretion on the part of the then DENR Secretary in the approval and issuance of MPSA
Nos. 220-2005-IVB and 221-2005-IVB. Costs against Celestial Nickel Mining Exploration Corporation and Blue Ridge Mineral
Corporation.

SO ORDERED.

PRESBITERO J. VELASCO, JR.


Associate Justice
G.R. No. L-43349 October 23, 1984

REMUS VILLAVIEJA, petitioner,


vs.
MARINDUQUE MINING AND INDUSTRIAL CORPORATION, and the WORKMEN'S COMPENSATION
COMMISSION, respondents.

Anastacio C. Rufon for petitioner.

Rexes V. Alejano for respondent Company.

GUTIERREZ, JR., J.:ñé+.£ªwph!1

This is a petition to review on certiorari the decision of the Workmen's Compensation Commission absolving
respondent Marinduque Mining and Industrial Corporation from liability in a claim for injury and sickness benefits.

Petitioner was hired as helper by respondent Marinduque Mining in its crushing plant. His work consisted, among
other things, of watching and taking charge of the trip conveyor machine loaded with stones. Whenever it stopped
functioning he had to unload the stones, fix and clean the machine and the tail pulley, push the button and load the
unloaded stones. He also had to take charge of the loading of spilled lid and of cleaning everything found within the
premises, as well as all other work assigned to him by his foreman. His job required him to follow this routine from
8:00 a.m. to 4:00 p.m. The petitioner had been exposed to fumes, smoke, heat of the engine, hunger, thirst, physical
strain, holding his urination and "all sorts of hardship."

Sometime in May, 1973, while still in the active course of his employment, Villavieja was operated on for kidney
trouble but he was able to resume work on September 16, 1973. Although the sickness was not completely arrested,
he was asked and was permitted to work up to the time of dismissal on January 23, 1975.

On February 5, 1975, petitioner filed the instant claims for injury or sickness benefits and reimbursement of medical
expenses. The claim was uncontroverted by his employer and a decision was rendered by the Chief, Workmen's
Compensation Unit awarding the petitioner's claims.

Respondent corporation filed a petition for review stating that the decision was a nullity for lack of due process, the
case not having been formally set for hearing for the reception of the evidence of the parties. Moreover, Marinduque
Mining and Industrial Corporation alleged that the referee erred in holding it liable for claimant's illness which is not
work-connected.

The Workmen's Compensation Commission en banc, reversed the decision of the Chief, Workmen's Compensation
Unit, Bacolod City. The Commission held that. "The record reveals that claimant was paid 60% of his average weekly
wage during his temporary total disability. The grant of 50% NSD is without basis because under the New Schedule
of Compensation, a supplement to the law, there is no NSD for this illness. "

Hence this petition.

The sole issue at hand is whether or not the respondent Commission committed grave abuse of discretion when it
reversed the derision or award of the Chief. Workmen's Compensation Until and dismissed the case in its entirety
including reimbursement for medical expenses, and in further holding that illness due to stones of the kidney y is non-
compensable as a Non-Scheduled Disability NSD

Petitioner relies on the presumption of compensability of illness which supervenes during employment.

Respondent, however, maintains that petitioner's illness is a non occupational disease which can be acquired without
regard to one s employment. It is alleged that the case was not formally et. for hearing before the Workmen's
Compensation Unit, with the result that the decision was rendered without evidentiary basis to support compensability
either on causal connection between the ailment and the employment nor aggravation of illness by reason of the
nature of the employment.

We only need to reiterate well-settled principles and jurisprudence to resolve the issue at hand. As early as Batangas
Transportation Co. v. Vda. de Rivera, 99 Phil. 1025 in 1956 and Bohol Land Transportation Co. v. De Madanguit, 70
Phil. 685 to Felarca v. Bookman, Inc. 127 SCRA 275 in 1984, this court has consistently ruled that "It is to be
presumed as mandated by Section 44 of the Workmen's Compensation Act that the employee's illness which
supervened during his employment, either arose out of or at least was aggravated by said employment and with this
legal presumption, the burden of proof shifts to the employer and the employee is relieved of the burden to show
causation." True, this presumption may be rebutted by substantial evidence to the contrary. Yet, the records in the
case at bar show that petitioner's "right to compensation has not been controverted by respondent" (Award by the
Chief, Workmen's Compensation Unit, Felicito D. Ciocon, page 16 Rollo). Thus failure to controvert results in the
renunciation of defenses available to the, employer, including The defense that the illness subject matter of the claim
is not, compensable (Vda. delos Santos v. Workmen's Compensation Commission, 88 SCRA 134). What the
Commission inexplicably failed to do,... was to apply the express mandate of Section 45 of Workmen's Compensation
Act, the pertinent provision of which reads: têñ.£îhqwâ£

In case the employer decided to controvert the right to compensation, he shall, either on or before
the fourteenth day of disability or within ten days after he has knowledge of the alleged accident,
file a notice with the Commissioner, on a form prescribed by him, that compensation is not being
paid, giving the name of the claimant, name of the employer, date of the accident and the reason
why compensation is not being paid. Failure on the part of the employer or the insurance carrier to
comply with the requirement shall constitute a renunciation of his right to controvert the claim
unless he submits reasonable grounds for the failure to make the necessary reports, on The basis
of which grounds the commissioner may reinstate its right to controvert the claim.

As we have heretofore held in an unbroken line of countless cases (Cf. Victorias Miling Co. v. Workmen's
Compensation Commission, 101 Phil, 1208; Magalona v. Workmen's Compensation Commission, 21 SCRA 1199;
Tortal vs. Workmen's Compensation Commission, 124 SCRA 211) it may issue outright an award, since a failure to
controvert introvert is a renunciation of the right to challenge the claim and a waiver of all non-jurisdictional defenses
and there is nothing that the employer really prove in relation thereto Dinaro v. Workmen's compensation
Commission, SCRA 292). Further, the employer's failure to controvert the claim for compensation is equivalent to a
waiver of the right to due process, and an award can be issued without a formal hearing (Caleb v. Workmen's
Compensation Commission, 88 SCRA 114 Pajarillo v. Workmen's Compensation Commission, 95 SCRA 582; De
Castro, Jr. v. Republic, 75 SCRA 364). The employer may no longer be heard to complain after having failed to avail
of its rights under the law. Here, there is no showing of any petition under oath for reinstatement of the right to
controvert nor any claim of fraud or collusion in the non-controversion of the claim (Dinaro v. Workmen's
Compensation Commission, supra). Hence the issuance of an award in favor of petitioner-claimant is in order.

Petitioner assails respondent Commission's dismissal of the case which included reimbursement for medical
expenses. And with reason Section 13 of the Workmen's Compensation Act as amended, provides that "Immediately
after an employee has suffered an injury or contracted sickness and during the subsequent period of disability, the
employer or insurance carrier shall provide the employee with such services, appliances and supplies as the nature
of his disability and the process of his recovery may require; and that which will promote his early restoration to the
maximum level of his physical capacity. ..." Against this, the law provides the employee with only a single defense, to
wit: "... If it is shown before the Commission or its authorized representative that the injured or sick employee
voluntarily refused to accept without justifiable cause the services, appliances and supplies provided by the employer
or insurance carrier or voluntarily obstructed without justifiable cause the giving of such services, appliances and
supplies, such refusal or obstruction shall be construed as a waiver of all or part of his rights to the same and in this
case, the employer or insurance carrier shall be liable only for the disability of any nature that would have ensued if
the injured or sick employee has accepted the services, appliances and supplies tendered by the employer or
insurance carrier; ..." (paragraph 4, Section 13, Workmen's Compensation Act). There has been no such waiver of
petitioner's right to reimbursement for medical expenses. Yet, the Workmen's Compensation Commission in its
decision, withheld the grant of such benefit. No explanation was made why the same was denied there being no
relinquishment of rights under the law, and the compensability of the illness having been shown, reimbursement of
medical expenses already incurred by petitioner in the amount of P1,836.00 is but proper.

Petitioner further takes exception to the Commission's ruling to wit: têñ.£îhqwâ£


The record reveals that claimant was paid 60% of his average weekly wage during his temporary
total disability. The grant of 50% NSD is without basis because under the new Schedule of
Compensation, a Supplement to the law, there is no NSD for this illness.

It is alleged that there was no payment whatsoever made by respondent company. We are inclined to agree. Other
than its own assertion, there is no showing nor any evidence presented to show any alleged payment by respondent.
The facts show that upon receipt of the award issued in favor of the petitioner by the Workmen's Compensation Unit,
a petition for review was filed by respondent, which petition resulted in the reversal of said award by the Commission
en banc. Respondent asserts petitioner's non-entitlement to the award yet, at the same time alleges payment of
disability compensation to petitioner-claimant. Having alleged the latter, it would be consistent with respondent's
posture to request a refund or return of payment from petitioner after receipt of the Commission's decision in its favor.
It is quite contrary to reason and logic that such payment be advanced to support respondent's contention.
Respondent cannot now allege payment of compensation to avoid liability under the law.

Anent the 50% NSD disability benefit, aside from the non-controversion thereof by respondent before the Workmen's
Compensation Unit, it should be understood that although the Schedule of Compensation, a supplement to Article 18,
paragraph 5 of the Workmen's Compensation Act, does not specifically provide for kidney stone as a non-scheduled
disability, it must be understood that just as the law is non-exclusive, the enumeration therein must, likewise, be
understood as such. Further, such schedule explicitly provides for cases under which the petitioner's disability may
fag, to wit:

XX. THE ABDOMEN têñ.£îhqwâ£

xxx xxx xxx

2. Chronic diseases of any kind of the abdominal organs arising from industrial injury and resulting
in permanent derangement of their functions, or impairment of nutrition:

xxx xxx xxx

a. Slight ...

b. Moderate ...

c. Severe (such as chronic disease of the abdominal organs as produces marked impairment of
nutrition or such symptoms as totally incapacitate the laborer from securing or retaining
employment).

(New Schedule of Compensation, A Supplement to the One Prescribed by Law, Fourth Issue, Revised, improved and
up dated [1964] by Fidel M. Guilatco M.D. DIH, Chief Compensation Rating Medical Officer and Chief, Evaluation
Division, Bureau of Workmen's Compensation, Department of Labor, Manila).

Moreover, as between the impartial finding or evaluation on the matter of disability of the Compensation Medical
Rating Officer who had physically examined petitioner-claimant and the conclusion of the Associate commisioner of
the respondent Workmen's Compensation Commission based merely on his general observation of the case, we find
the former more reliable.

WHEREFORE, in view of the foregoing, the petition is hereby GRANTED. The decision of the respondent Workmen's
Compensation Commission is REVERSED and SET ASIDE. The decision of the Chief, Workmen's Compensation
Unit, Felicito D. Ciocon, dated November 12, 1975 is REINSTATED. Respondent Marinduque Mining and Industrial
Corporation is ordered:

1. To pay petitioner-claimant the amount of FOUR THOUSAND FOUR HUNDRED EIGHTY FOUR & 63/100
(P4,484.63) PESOS as disability compensation benefits;

2. To reimburse petitioner his medical and hospital expenses in the amount of ONE THOUSAND EIGHT HUNDRED
THIRTY SIX (P1,836.00) PESOS subject to strict auditing procedures of respondent company;
3. To pay petitioner attorney's fees in the amount of FOUR HUNDRED FORTY-EIGHT & 46/100 (P448.46) PESOS;
and

4. To pay to the Ministry of Labor and Employment the sum of FORTY FIVE (P45.00) PESOS for expenses for
administration.

SO ORDERED.1äwphï1.ñët

Teehankee (Chairman), Melencio-Herrera, Plana, Relova and De la Fuente, JJ., concur.


REPUBLIC OF THE PHILIPPINES, Represented by the Department of Environment and Natural Resources
(DENR) Under then Minister ERNESTO R. MACEDA; and Former Government Officials CATALINO
MACARAIG, FULGENCIO S. FACTORAN, ANGEL C. ALCALA, BEN MALAYANG, ROBERTO
PAGDANGANAN, MARIANO Z. VALERA and ROMULO SAN JUAN, petitioners, vs. ROSEMOOR
MINING AND DEVELOPMENT CORPORATION, PEDRO DEL CONCHA, and ALEJANDRO and RUFO DE
GUZMAN, respondents.

DECISION
PANGANIBAN, J.:

A mining license that contravenes a mandatory provision of the law under which it is granted is void. Being a mere
privilege, a license does not vest absolute rights in the holder. Thus, without offending the due process and the non-
impairment clauses of the Constitution, it can be revoked by the State in the public interest.

The Case

Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, seeking to nullify the May 29, 2001
Decision[2] and the September 6, 2001 Resolution[3] of the Court of Appeals (CA) in CA-GR SP No. 46878. The CA
disposed as follows:

WHEREFORE, premises considered, the appealed Decision is hereby AFFIRMED in toto.[4]

The questioned Resolution denied petitioners Motion for Reconsideration.


On the other hand, trial courts Decision, which was affirmed by the CA, had disposed as follows:
WHEREFORE, judgment is hereby rendered as follows:

1. Declaring that the cancellation of License No. 33 was done without jurisdiction and in gross violation of the
Constitutional right of the petitioners against deprivation of their property rights without due process of law and is
hereby set aside.

2. Declaring that the petitioners right to continue the exploitation of the marble deposits in the area covered by License
No. 33 is maintained for the duration of the period of its life of twenty-five (25) years, less three (3) years of continuous
operation before License No. 33 was cancelled, unless sooner terminated for violation of any of the conditions
specified therein, with due process.

3. Making the Writ of preliminary injunction and the Writ of Preliminary Mandatory Injunction issued as permanent.

4. Ordering the cancellation of the bond filed by the Petitioners in the sum of 1 Million.

5. Allowing the petitioners to present evidence in support of the damages they claim to have suffered from, as a
consequence of the summary cancellation of License No. 33 pursuant to the agreement of the parties on such dates as
maybe set by the Court; and

6. Denying for lack of merit the motions for contempt, it appearing that actuations of the respondents were not
contumacious and intended to delay the proceedings or undermine the integrity of the Court.

No pronouncement yet as to costs.[5]

The Facts
The CA narrated the facts as follows:

The four (4) petitioners, namely, Dr. Lourdes S. Pascual, Dr. Pedro De la Concha, Alejandro De La Concha, and Rufo De
Guzman, after having been granted permission to prospect for marble deposits in the mountains of Biak-na-Bato, San Miguel,
Bulacan, succeeded in discovering marble deposits of high quality and in commercial quantities in Mount Mabio which forms
part of the Biak-na-Bato mountain range.

Having succeeded in discovering said marble deposits, and as a result of their tedious efforts and substantial expenses, the
petitioners applied with the Bureau of Mines, now Mines and Geosciences Bureau, for the issuance of the corresponding license
to exploit said marble deposits.

xxxxxxxxx

After compliance with numerous required conditions, License No. 33 was issued by the Bureau of Mines in favor of the herein
petitioners.

xxxxxxxxx

Shortly after Respondent Ernesto R. Maceda was appointed Minister of the Department of Energy and Natural Resources
(DENR), petitioners License No. 33 was cancelled by him through his letter to ROSEMOOR MINING AND DEVELOPMENT
CORPORATION dated September 6, 1986 for the reasons stated therein. Because of the aforesaid cancellation, the original
petition was filed and later substituted by the petitioners AMENDED PETITION dated August 21, 1991 to assail the same.

Also after due hearing, the prayer for injunctive relief was granted in the Order of this Court dated February 28,
1992. Accordingly, the corresponding preliminary writs were issued after the petitioners filed their injunction bond in the amount
of ONE MILLION PESOS (P1,000,000.00).

xxxxxxxxx

On September 27, 1996, the trial court rendered the herein questioned decision.[6]

The trial court ruled that the privilege granted under respondents license had already ripened into a property right,
which was protected under the due process clause of the Constitution. Such right was supposedly violated when the
license was cancelled without notice and hearing. The cancellation was said to be unjustified, because the area that
could be covered by the four separate applications of respondents was 400 hectares. Finally, according to the RTC,
Proclamation No. 84, which confirmed the cancellation of the license, was an ex post facto law; as such, it violated
Section 3 of Article XVIII of the 1987 Constitution.
On appeal to the Court of Appeals, herein petitioners asked whether PD 463 or the Mineral Resources
Development Decree of 1974 had been violated by the award of the 330.3062 hectares to respondents in accordance
with Proclamation No. 2204. They also questioned the validity of the cancellation of respondents Quarry License/Permit
(QLP) No. 33.

Ruling of the Court of Appeals

Sustaining the trial court in toto, the CA held that the grant of the quarry license covering 330.3062 hectares to
respondents was authorized by law, because the license was embraced by four (4) separate applications -- each for
an area of 81 hectares. Moreover, it held that the limitation under Presidential Decree No. 463 -- that a quarry license
should cover not more than 100 hectares in any given province -- was supplanted by Republic Act No. 7942,[7] which
increased the mining areas allowed under PD 463.
It also ruled that the cancellation of respondents license without notice and hearing was tantamount to a
deprivation of property without due process of law. It added that under the clause in the Constitution dealing with the
non-impairment of obligations and contracts, respondents license must be respected by the State.
Hence, this Petition.[8]
Issues

Petitioners submit the following issues for the Courts consideration:

(1) [W]hether or not QLP No. 33 was issued in blatant contravention of Section 69, P.D. No. 463; and (2) whether or not
Proclamation No. 84 issued by then President Corazon Aquino is valid. The corollary issue is whether or not the Constitutional
prohibition against ex post facto law applies to Proclamation No. 84[9]

The Courts Ruling

The Petition has merit.

First Issue:
Validity of License

Respondents contend that the Petition has no legal basis, because PD 463 has already been repealed. [10] In
effect, they ask for the dismissal of the Petition on the ground of mootness.
PD 463, as amended, pertained to the old system of exploration, development and utilization of natural resources
through licenses, concessions or leases.[11] While these arrangements were provided under the 1935 [12] and the
1973[13] Constitutions, they have been omitted by Section 2 of Article XII of the 1987 Constitution. [14]
With the shift of constitutional policy toward full control and supervision of the State over natural resources, the
Court in Miners Association of the Philippines v. Factoran Jr. [15] declared the provisions of PD 463 as contrary to or
violative of the express mandate of the 1987 Constitution. The said provisions dealt with the lease of mining claims;
quarry permits or licenses covering privately owned or public lands; and other related provisions on lease, licenses and
permits.
RA 7942 or the Philippine Mining Act of 1995 embodies the new constitutional mandate. It has repealed or
amended all laws, executive orders, presidential decrees, rules and regulations -- or parts thereof -- that are inconsistent
with any of its provisions.[16]
It is relevant to state, however, that Section 2 of Article XII of the 1987 Constitution does not apply retroactively
to a license, concession or lease granted by the government under the 1973 Constitution or before the effectivity of the
1987 Constitution on February 2, 1987.[17] As noted in Miners Association of the Philippines v. Factoran Jr., the
deliberations of the Constitutional Commission [18] emphasized the intent to apply the said constitutional provision
prospectively.
While RA 7942 has expressly repealed provisions of mining laws that are inconsistent with its own, it nonetheless
respects previously issued valid and existing licenses, as follows:

SECTION 5. Mineral Reservations. When the national interest so requires, such as when there is a need to preserve strategic raw
materials for industries critical to national development, or certain minerals for scientific, cultural or ecological value, the
President may establish mineral reservations upon the recommendation of the Director through the Secretary. Mining operations
in existing mineral reservations and such other reservations as may thereafter be established, shall be undertaken by the
Department or through a contractor: Provided, That a small scale-mining cooperative covered by Republic Act No. 7076 shall be
given preferential right to apply for a small-scale mining agreement for a maximum aggregate area of twenty-five percent (25%)
of such mineral reservation, subject to valid existing mining/quarrying rights as provided under Section 112 Chapter XX
hereof. All submerged lands within the contiguous zone and in the exclusive economic zone of the Philippines are hereby
declared to be mineral reservations.

xxxxxxxxx

SECTION 7. Periodic Review of Existing Mineral Reservations. The Secretary shall periodically review existing mineral
reservations for the purpose of determining whether their continued existence is consistent with the national interest, and upon his
recommendation, the President may, by proclamation, alter or modify the boundaries thereof or revert the same to the public
domain without prejudice to prior existing rights.

SECTION 18. Areas Open to Mining Operations. Subject to any existing rights or reservations and prior agreements of all
parties, all mineral resources in public or private lands, including timber or forestlands as defined in existing laws, shall be open
to mineral agreements or financial or technical assistance agreement applications. Any conflict that may arise under this
provision shall be heard and resolved by the panel of arbitrators.

SECTION 19. Areas Closed to Mining Applications. -- Mineral agreement or financial or technical assistance agreement
applications shall not be allowed:

(a) In military and other government reservations, except upon prior written clearance by the government agency concerned;

(b) Near or under public or private buildings, cemeteries, archeological and historic sites, bridges, highways, waterways,
railroads, reservoirs, dams or other infrastructure projects, public or private works including plantations or valuable crops, except
upon written consent of the government agency or private entity concerned;

(c) In areas covered by valid and existing mining rights;

(d) In areas expressly prohibited by law;

(e) In areas covered by small-scale miners as defined by law unless with prior consent of the small-scale miners, in which case a
royalty payment upon the utilization of minerals shall be agreed upon by the parties, said royalty forming a trust fund for the
socioeconomic development of the community concerned; and

(f) Old growth or virgin forests, proclaimed watershed forest reserves, wilderness areas, mangrove forests, mossy forests,
national parks, provincial/municipal forests, parks, greenbelts, game refuge and bird sanctuaries as defined by law and in areas
expressly prohibited under the National Integrated Protected Areas System (NIPAS) under Republic Act No. 7586, Department
Administrative Order No. 25, series of 1992 and other laws.

SECTION 112. Non-impairment of Existing Mining/ Quarrying Rights. All valid and existing mining lease contracts,
permits/licenses, leases pending renewal, mineral production-sharing agreements granted under Executive Order No. 279, at the
date of effectivity of this Act, shall remain valid, shall not be impaired, and shall be recognized by the Government: Provided,
That the provisions of Chapter XIV on government share in mineral production-sharing agreement and of Chapter XVI on
incentives of this Act shall immediately govern and apply to a mining lessee or contractor unless the mining lessee or contractor
indicates his intention to the secretary, in writing, not to avail of said provisions: Provided, further, That no renewal of mining
lease contracts shall be made after the expiration of its term: Provided, finally, That such leases, production-sharing agreements,
financial or technical assistance agreements shall comply with the applicable provisions of this Act and its implementing rules
and regulations.

SECTION 113. Recognition of Valid and Existing Mining Claims and Lease/Quarry Application. Holders of valid and existing
mining claims, lease/quarry applications shall be given preferential rights to enter into any mode of mineral agreement with the
government within two (2) years from the promulgation of the rules and regulations implementing this Act. (Underscoring
supplied)

Section 3(p) of RA 7942 defines an existing mining/quarrying right as a valid and subsisting mining claim or permit
or quarry permit or any mining lease contract or agreement covering a mineralized area granted/issued under pertinent
mining laws. Consequently, determining whether the license of respondents falls under this definition would be relevant
to fixing their entitlement to the rights and/or preferences under RA 7942. Hence, the present Petition has not been
mooted.
Petitioners submit that the license clearly contravenes Section 69 of PD 463, because it exceeds the maximum
area that may be granted. This incipient violation, according to them, renders the license void ab initio.
Respondents, on the other hand, argue that the license was validly granted, because it was covered by four
separate applications for areas of 81 hectares each.
The license in question, QLP No. 33,[19] is dated August 3, 1982, and it was issued in the name of Rosemoor
Mining Development Corporation. The terms of the license allowed the corporation to extract and dispose of marbleized
limestone from a 330.3062-hectare land in San Miguel, Bulacan. The license is, however, subject to the terms and
conditions of PD 463, the governing law at the time it was granted; as well as to the rules and regulations promulgated
thereunder.[20] By the same token, Proclamation No. 2204 -- which awarded to Rosemoor the right of development,
exploitation, and utilization of the mineral site -- expressly cautioned that the grant was subject to existing policies, laws,
rules and regulations.[21]
The license was thus subject to Section 69 of PD 463, which reads:

Section 69. Maximum Area of Quarry License Notwithstanding the provisions of Section 14 hereof, a quarry license
shall cover an area of not more than one hundred (100) hectares in any one province and not more than one thousand (1,000)
hectares in the entire Philippines. (Italics supplied)

The language of PD 463 is clear. It states in categorical and mandatory terms that a quarry license, like that of
respondents, should cover a maximum of 100 hectares in any given province. This law neither provides any exception
nor makes any reference to the number of applications for a license. Section 69 of PD 463 must be taken to mean
exactly what it says.Where the law is clear, plain, and free from ambiguity, it must be given its literal meaning and
applied without attempted interpretation.[22]
Moreover, the lower courts ruling is evidently inconsistent with the fact that QLP No. 33 was issued solely in the
name of Rosemoor Mining and Development Corporation, rather than in the names of the four individual stockholders
who are respondents herein. It likewise brushes aside a basic postulate that a corporation has a separate personality
from that of its stockholders.[23]
The interpretation adopted by the lower courts is contrary to the purpose of Section 69 of PD 463. Such intent to
limit, without qualification, the area of a quarry license strictly to 100 hectares in any one province is shown by the
opening proviso that reads: Notwithstanding the provisions of Section 14 hereof x x x. The mandatory nature of the
provision is also underscored by the use of the word shall. Hence, in the application of the 100-hectare-per-province
limit, no regard is given to the size or the number of mining claims under Section 14, which we quote:

SECTION 14. Size of Mining Claim. -- For purposes of registration of a mining claim under this Decree, the Philippine territory
and its shelf are hereby divided into meridional blocks or quadrangles of one-half minute (1/2) of latitude and longitude, each
block or quadrangle containing area of eighty-one (81) hectares, more or less.

A mining claim shall cover one such block although a lesser area may be allowed if warranted by attendant circumstances, such
as geographical and other justifiable considerations as may be determined by the Director: Provided, That in no case shall the
locator be allowed to register twice the area allowed for lease under Section 43 hereof. (Italics supplied)

Clearly, the intent of the law would be brazenly circumvented by ruling that a license may cover an area exceeding
the maximum by the mere expediency of filing several applications.Such ruling would indirectly permit an act that is
directly prohibited by the law.

Second Issue:
Validity of Proclamation No. 84

Petitioners also argue that the license was validly declared a nullity and consequently withdrawn or terminated. In
a letter dated September 15, 1986, respondents were informed by then Minister Ernesto M. Maceda that their license
had illegally been issued, because it violated Section 69 of PD 463; and that there was no more public interest served
by the continued existence or renewal of the license. The latter reason, they added, was confirmed by the language of
Proclamation No. 84. According to this law, public interest would be served by reverting the parcel of land that was
excluded by Proclamation No. 2204 to the former status of that land as part of the Biak-na-Bato national park.
They also contend that Section 74 of PD 463 would not apply, because Minister Macedas letter did not cancel or
revoke QLP No. 33, but merely declared the latters nullity. They further argue that respondents waived notice and
hearing in their application for the license.
On the other hand, respondents submit that, as provided for in Section 74 of PD 463, their right to due process
was violated when their license was cancelled without notice and hearing. They likewise contend that Proclamation No.
84 is not valid for the following reasons: 1) it violates the clause on the non-impairment of contracts; 2) it is an ex post
facto law and/or a bill of attainder; and 3) it was issued by the President after the effectivity of the 1987 Constitution.
This Court ruled on the nature of a natural resource exploration permit, which was akin to the present respondents
license, in Southeast Mindanao Gold Mining Corporation v. Balite Portal Mining Cooperative,[24] which held:

x x x. As correctly held by the Court of Appeals in its challenged decision, EP No. 133 merely evidences a privilege granted by
the State, which may be amended, modified or rescinded when the national interest so requires. This is necessarily so since the
exploration, development and utilization of the countrys natural mineral resources are matters impressed with great public
interest. Like timber permits, mining exploration permits do not vest in the grantee any permanent or irrevocable right within the
purview of the non-impairment of contract and due process clauses of the Constitution, since the State, under its all-
encompassing police power, may alter, modify or amend the same, in accordance with the demands of the general welfare. [25]

This same ruling had been made earlier in Tan v. Director of Forestry[26] with regard to a timber license, a
pronouncement that was reiterated in Ysmael v. Deputy Executive Secretary,[27] the pertinent portion of which reads:

x x x. 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(ee) 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].[28] (Italics supplied)

In line with the foregoing jurisprudence, respondents license may be revoked or rescinded by executive action
when the national interest so requires, because it is not a contract, property or a property right protected by the due
process clause of the Constitution.[29] Respondents themselves acknowledge this condition of the grant under
paragraph 7 of QLP No. 33, which we quote:

7. This permit/license may be revoked or cancelled at any time by the Director of Mines and Geo-Sciences when, in his opinion
public interests so require or, upon failure of the permittee/licensee to comply with the provisions of Presidential Decree No. 463,
as amended, and the rules and regulations promulgated thereunder, as well as with the terms and conditions specified
herein; Provided, That if a permit/license is cancelled, or otherwise terminated, the permittee/licensee shall be liable for all
unpaid rentals and royalties due up to the time of the termination or cancellation of the permit/license[.] [30](Italics supplied)

The determination of what is in the public interest is necessarily vested in the State as owner of all mineral
resources. That determination was based on policy considerations formally enunciated in the letter dated September
15, 1986, issued by then Minister Maceda and, subsequently, by the President through Proclamation No. 84. As to the
exercise of prerogative by Maceda, suffice it to say that while the cancellation or revocation of the license is vested in
the director of mines and geo-sciences, the latter is subject to the formers control as the department head. We also
stress the clear prerogative of the Executive Department in the evaluation and the consequent cancellation of licenses
in the process of its formulation of policies with regard to their utilization. Courts will not interfere with the exercise of
that discretion without any clear showing of grave abuse of discretion. [31]
Moreover, granting that respondents license is valid, it can still be validly revoked by the State in the exercise of
police power.[32] The exercise of such power through Proclamation No. 84 is clearly in accord with jura regalia, which
reserves to the State ownership of all natural resources. [33] This Regalian doctrine is an exercise of its sovereign power
as owner of lands of the public domain and of the patrimony of the nation, the mineral deposits of which are a valuable
asset.[34]
Proclamation No. 84 cannot be stigmatized as a violation of the non-impairment clause. As pointed out earlier,
respondents license is not a contract to which the protection accorded by the non-impairment clause may
extend.[35] Even if the license were, it is settled that provisions of existing laws and a reservation of police power are
deemed read into it, because it concerns a subject impressed with public welfare. [36] As it is, the non-impairment clause
must yield to the police power of the state.[37]
We cannot sustain the argument that Proclamation No. 84 is a bill of attainder; that is, a legislative act which
inflicts punishment without judicial trial.[38] Its declaration that QLP No. 33 is a patent nullity[39] is certainly not a
declaration of guilt. Neither is the cancellation of the license a punishment within the purview of the constitutional
proscription against bills of attainder.
Too, there is no merit in the argument that the proclamation is an ex post facto law. There are six recognized
instances when a law is considered as such: 1) it criminalizes and punishes an action that was done before the passing
of the law and that was innocent when it was done; 2) it aggravates a crime or makes it greater than it was when it was
committed; 3) it changes the punishment and inflicts one that is greater than that imposed by the law annexed to the
crime when it was committed; 4) it alters the legal rules of evidence and authorizes conviction upon a less or different
testimony than that required by the law at the time of the commission of the offense; 5) it assumes the regulation of
civil rights and remedies only, but in effect imposes a penalty or a deprivation of a right as a consequence of
something that was considered lawful when it was done; and 6) it deprives a person accused of a crime of some
lawful protection to which he or she become entitled, such as the protection of a former conviction or an acquittal or the
proclamation of an amnesty.[40] Proclamation No. 84 does not fall under any of the enumerated categories; hence, it is
not an ex post facto law.
It is settled that an ex post facto law is limited in its scope only to matters criminal in nature. [41] Proclamation 84,
which merely restored the area excluded from the Biak-na-Bato national park by canceling respondents license, is
clearly not penal in character.
Finally, it is stressed that at the time President Aquino issued Proclamation No. 84 on March 9, 1987, she was
still validly exercising legislative powers under the Provisional Constitution of 1986. [42] Section 1 of Article II of
Proclamation No. 3, which promulgated the Provisional Constitution, granted her legislative power until a legislature is
elected and convened under a new Constitution. The grant of such power is also explicitly recognized and provided for
in Section 6 of Article XVII of the 1987 Constitution.[43]
WHEREFORE, this Petition is hereby GRANTED and the appealed Decision of the Court of Appeals SET
ASIDE. No costs.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Ynares-Santiago, Carpio, and Azcuna, JJ., concur.
G.R. No. 172678 March 23, 2011

SEA LION FISHING CORPORATION, Petitioner,


vs.
PEOPLE OF THE PHILIPPINES, Respondent.

DECISION

DEL CASTILLO, J.:

When an instrument or tool used in a crime is being claimed by a third-party not liable to the offense, such third-party
must first establish its ownership over the same.

This is a Petition for Review on Certiorari assailing the January 10, 2006 Decision1 of the Court of Appeals (CA) in
CA-G.R. SP No. 91270 which denied the Petition for Certiorari and Mandamus2 questioning the twin Sentences3both
dated May 16, 2005 and the Order4 dated August 4, 2005 of the Regional Trial Court (RTC) of Puerto Princesa City,
Branch 52 in Criminal Case Nos. 18965 and 19422. Likewise assailed is the May 5, 2006 Resolution 5 of the CA
denying the Motion for Reconsideration6 thereto.

Factual Antecedents

In response to fishermen’s report of poaching off Mangsee Island in Balabac, Palawan, a combined team of
Philippine Marines, Coast Guard and barangay officials conducted search and seizure operations therein. There they
found F/V Sea Lion anchored three nautical miles northwest of Mangsee Island. Beside it were five boats and a long
fishing net already spread over the water. The team boarded the vessel and apprehended her captain, a Filipino, and
a crew composed of three Filipinos and three Chinese. Also arrested were 17 Chinese fishermen aboard F/V Sea
Lion.

Various charges were thereafter filed as follows: (1) Violation of Section 977 of Republic Act (RA) No. 85508 against
all those arrested, docketed as I.S. No. 2004-032; (2) Violation of Section 909 of the same law against the captain of
F/V Sea Lion, the Chief Engineer, and the President of the corporation which owned said vessel, docketed as I.S. No.
2004-061; and (3) Violation of Section 27(a) and (f)10 of RA 914711 and of Section 8712 of RA 8550 against all those
arrested and the President of the corporation which owned the vessel, respectively docketed as I.S. Nos. 2004-68,
2004-69, and 2004-70.

Ruling of the Provincial Prosecutor

While the Provincial Prosecutor of Palawan dismissed I.S. Nos. 2004-61, 2004-68 and 2004-69, he nevertheless
found probable cause for the remaining charges 13 but only against the 17 Chinese fishermen.14 This was after it was
found out that the crew of F/V Sea Lion did not assent to the illegal acts of said 17 Chinese fishermen who were
rescued by the crew of the F/V Sea Lion from a distressed Chinese vessel. The prosecutor concluded that the crew,
unarmed, outnumbered and hampered by language barrier, acted only out of uncontrollable fear of imminent danger
to their lives and property which hindered them from asserting their authority over these Chinese nationals.
Accordingly, corresponding Informations against the 17 Chinese fishermen were filed in court.

With the crew of F/V Sea Lion now exculpated, petitioner Sea Lion Fishing Corporation filed before the Office of the
Provincial Prosecutor an Urgent Motion for Release of Evidence 15 alleging that it owns the vessel. Said Office thus
issued a Resolution16 dated August 25, 2004, viz:

WHEREFORE, F/[V] Sea Lion is hereby recommended to be released to the movant upon proper showing of
evidence of its ownership of the aforesaid vessel and the posting of a bond double the value of said vessel as
appraised by the MARINA, if through any court accredited company surety, or equal to the aforesaid value[,] if by
cash bond. Said bond shall be on the condition that [the] vessel owner shall make [the vessel] available for inspection
during the course of the trial.17 (Emphasis supplied.)

This Resolution was later amended through a Supplemental Resolution 18 dated September 10, 2004 reading as
follows:
This pertains to the Resolution of the undersigned dated 25 August 2004 recommending the release of the vessel
F/[V] Sea Lion. In addition to the conditions therein, the release of the said vessel shall be with the approval of the
Provincial Committee on Illegal Entrants which has jurisdiction over all apprehended vessels involved in poaching. 19

Petitioner, however, failed to act in accordance with said Resolutions.

Ruling of the Regional Trial Court

The case for Violation of Section 97 of RA 8550 was docketed as Criminal Case No. 18965 while that for Violation of
Section 87 of the same law was docketed as Criminal Case No. 19422. The Chinese nationals entered separate
pleas of "not guilty" for both offenses. Later, however, in Criminal Case No. 18965, they changed their pleas from "not
guilty" to "guilty" for the lesser offense of Violation of Section 88, sub-paragraph (3)20 of RA 8550. Hence, they were
accordingly declared guilty of said lesser offense in a Sentence 21 issued by the RTC of Puerto Princesa City, Branch
52 on May 16, 2005, the dispositive portion of which reads:

WHEREFORE, with the plea of guilty of all the accused to the lesser offense, the Court hereby finds the Seventeen
(17) accused guilty beyond reasonable doubt as principals for the crime of Violation of Section 88, sub-par. (3) of
R.A. 8550 and sentences them to suffer an imprisonment of FIVE (5) YEARS TO SIX (6) YEARS, SIX (6) MONTHS
AND SEVEN (7) DAYS. The Fishing Vessel F/V Sea Lion I as well as the fishing paraphernalia and equipments used
by the accused in committing the crime [are] hereby ordered confiscated in favor of the government.

The x x x confiscated vessel and all the fishing gadgets, paraphernalia and equipment are hereby ordered to be
placed under the [temporary] custody of the Philippine Coast Guard. The latter is hereby directed to prepare and
submit to this Court the inventory of all confiscated items within 15 days from receipt of this order. Further, the
Commander of the Philippine Coast Guard should observe the diligence of a good father of the family in the
preservation and maintenance of the entrusted confiscated items until the final disposition thereof by the Court.

Having appeared that the accused have been detained since January 19, 2004, the period of their detention is hereby
credited in their favor.

SO ORDERED.22

A Sentence23 in Criminal Case No. 19422 was also issued on even date, the dispositive portion of which reads:

WHEREFORE, with the plea of guilty of all seventeen (17) accused, the Court hereby finds them guilty beyond
reasonable doubt as principals of the crime of Violation of Section 87 of R.A. 8550 (Poaching) and sentences them to
pay a fine of One Hundred Thousand (US$100,000.00) Dollars to be paid to the Republic of the Philippines. The
Fishing Vessel F/V Sea Lion 1 as well as the fishing paraphernalia and equipments used by the accused in
committing the crime [are] hereby ordered confiscated in the favor of the government.

The x x x confiscated vessel and all the fishing gadgets, paraphernalia and equipment are hereby ordered to be
placed under the [temporary] custody of the Philippine Coast Guard. The latter is hereby directed to prepare and
submit to this Court the inventory of all confiscated items within 15 days from receipt of this order. Further, the
commander of the Philippine Coast Guard should observe the diligence of a good father of the family in the
preservation and maintenance of the entrusted confiscated items until the final disposition thereof by the Court.

The Provincial Jail Warden of Palawan is hereby ordered to release all the above-named accused unless held for
some other lawful cause or causes.

SO ORDERED.24

It was only after the issuance of the above Sentences that petitioner again made its move by filing a Motion for
Reconsideration25 on June 24, 2005. It prayed for the trial court to delete from said Sentences the confiscation of F/V
Sea Lion. The Office of the Provincial Prosecutor filed an Opposition thereto. 26 After receipt of petitioner’s Reply27 to
said Opposition, the trial court denied petitioner’s Motion for Reconsideration.

Hence, petitioner filed a Petition for Certiorari and Mandamus28 with the CA.
Ruling of the Court of Appeals

On January 10, 2006, the CA promulgated its assailed Decision denying the petition. 29 The CA ruled that there was
no lack of jurisdiction, excess of jurisdiction or grave abuse of discretion on the part of the trial court since it had
jurisdiction over the crimes as alleged in the Informations and the penalty for violating the laws stated therein.
Necessarily, it had the authority to seize the F/V Sea Lion which was mentioned in the said Informations. The CA
further held that while the petitioner attempted to claim as its own the fishing vessel in its Motion for Reconsideration
dated June 24, 2005, its effort is undeserving of merit due to failure to adduce evidence. Lastly, the CA declared that
the petitioner did not avail of the proper procedural remedy. After the trial court recognized its personality to intervene
in the Order dated August 4, 2005, petitioner’s recourse should have been an appeal and not certiorari under Rule 65
of the Rules of Court.30

The appellate court also denied petitioner’s subsequent Motion for Reconsideration31 in its assailed Resolution dated
May 5, 2006.32

Thus, petitioner filed this Petition for Review on Certiorari raising the sole issue of whether the confiscation of F/V
Sea Lion was valid.33

The Parties’ Arguments

Petitioner contends that F/V Sea Lion should be released to it because it is the registered owner of said vessel and
her captain and crew members were not among those accused of and convicted in Criminal Case Nos. 18965 and
19422. To buttress its contention, petitioner invokes Article 45 of the Revised Penal Code which provides:

ART. 45. Confiscation and forfeiture of the proceeds or instruments of the crime. - Every penalty imposed for the
commission of a felony shall carry with it the forfeiture of the proceeds of the crime and the instruments or tools with
which it was committed.

Such proceeds and instruments or tools shall be confiscated and forfeited in favor of the Government, unless they
be the property of a third person not liable for the offense, but those articles which are not subject of lawful
commerce shall be destroyed. (Emphasis supplied.)

Petitioner also claims that it was denied its right to due process of law when it was not notified of the judicial
proceedings relative to the confiscation of the fishing vessel. It argues that such notification was necessary
considering that the provincial prosecutor was duly informed of its claim of ownership of the F/V Sea Lion.

On the other hand, respondent People of the Philippines through the Office of the Solicitor General (OSG) argues
that since the 17 Chinese nationals were charged with violations of the provisions of RA 8550, a special law, Article
45 of the Revised Penal Code does not apply. This is in view of Article 10 of said Code which specifically declares
that acts punishable by special laws are not subject to the provisions of the Revised Penal Code. They are only
supplementary to such laws unless the latter should specifically provide the contrary. Hence, the forfeiture and
confiscation of the fishing vessel under RA 8550 are different from the forfeiture and confiscation under the Revised
Penal Code which are additional penalties imposed in the event of conviction. And, since RA 8550 provides that the
vessel used in connection with or in direct violation of the provisions of RA 8550 shall be subjected to forfeiture in
favor of the government without mention of any distinction as to who owns the vessel, the forfeiture of F/V Sea Lion
was proper.

The OSG also contends that even if Article 45 of the Revised Penal Code is applicable, still the present petition must
fail due to petitioner’s failure to present its third-party claim at the earliest opportunity. It likewise argues that petitioner
was not deprived its right to due process considering that it was given ample opportunity to be heard particularly
when its motion for release of the F/V Sea Lion was granted by the Office of the Provincial Prosecutor subject to
certain conditions. However, it opted not to comply with the conditions imposed by the prosecutor and instead waited
for the trial court’s final disposition of the case.

Our Ruling

The petition has no merit.


We note, at the outset, that petitioner pursued an incorrect remedy when it sought recourse before the CA. The filing
of a Petition for Certiorari under Rule 65 of the Rules of Court before the CA is limited only to the correction of errors
of jurisdiction or grave abuse of discretion on the part of the trial court.34 "A special civil action for certiorari is an
independent action, raising the question of jurisdiction where the tribunal, board or officer exercising judicial or quasi-
judicial functions has acted without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or
excess of jurisdiction."35 The CA did not find either lack or error of jurisdiction or grave abuse of discretion. There was
no jurisdictional error because based on the Informations, 36 the offenses were committed within the territorial
jurisdiction of the trial court. The penalties imposable under the law were also within its jurisdiction. As a necessary
consequence, the trial court had the authority to determine how the subject fishing vessel should be disposed of.
Likewise, no grave abuse of discretion attended the issuance of the trial court’s order to confiscate F/V Sea Lion
considering the absence of evidence showing that said vessel is owned by a third party. Evidently, the remedial relief
pursued by the petitioner was infirm and improper.

We also agree with the CA’s observation that the trial court impliedly recognized petitioner’s right to intervene when it
pronounced that petitioner failed to exercise its right to claim ownership of the F/V Sea Lion. This being the case,
petitioner should have filed an appeal instead of a petition for certiorari before the CA. Under Rule 65 of the Rules of
Court, certiorari is unavailing when an appeal is the plain, speedy, and adequate remedy.37 "The nature of the
questions intended to be raised on appeal is of no consequence. It may well be that those questions will treat
exclusively of whether x x x the judgment or final order was rendered without or in excess of jurisdiction, or with grave
abuse of discretion x x x. This is immaterial. The remedy, to repeat, is appeal, not certiorari as a special civil
action."38 The jurisdiction of a court is not affected by its erroneous decision. 39 The orders and rulings of a court on all
controversies pertaining to the case cannot be corrected by certiorari if the court has jurisdiction over the subject
matter and over the person.40 Thus, we agree with the CA’s dismissal of the petition.

Even assuming that the CA may resolve an error of procedure or judgment, there was none committed in this
particular case.

Petitioner’s claim of ownership of F/V Sea Lion is not supported by any proof on record. The only document on record
that is relevant in this regard is a request for the release of the F/V Sea Lion based on petitioner’s alleged ownership
filed with the Provincial Prosecutor. While the latter authorized the release of said fishing vessel, this was conditioned
upon petitioner’s submission of a proof of ownership and the filing of a bond, with which petitioner failed to comply.
Even when judicial proceedings commenced, nothing was heard from the petitioner. No motion for intervention or any
manifestation came from petitioner’s end during the period of arraignment up to the rendition of sentence. While
petitioner later explained before the CA that its inaction was brought about by its inability to put up the required bond
due to financial difficulties, same is still not a sufficient justification for it to deliberately not act at all.

It was only after the trial court ordered the confiscation of F/V Sea Lion in its assailed twin Sentences that petitioner
was heard from again. This time, it filed a Motion for Reconsideration dated June 24, 2005 41 to which was attached a
copy of an alleged Certificate of Registration issued by the Maritime Industry Authority (MARINA).42 However, as
correctly observed by the CA:

Significantly, the lack of any factual basis for the third-party claim of ownership was not cured at all when the
petitioner filed its motion for reconsideration before the trial court. At that point, evidence should have been adduced
to support the petitioner’s claim (so that a new trial or reopening of the trial on the confiscation aspect should have
been prayed for, rather than a mere motion for reconsideration.) There is firstly the factual issue - to be proved by
proper evidence in order to be properly considered by the court - that the vessel is owned by a third party other than
the accused. Article 45 required too that proof be adduced that the third party is not liable for the offense. After the
admission by the accused through their guilty plea that the vessel had been used in the commission of a crime, we
believe and so hold that this additional Article 45 requirement cannot be simply inferred from the mere fact that the
alleged owner is not charged in the same case before the court. 43

Accordingly, petitioner’s recourse to a motion for reconsideration was not proper. Although it attached a copy of an
alleged Certificate of Registration, the same cannot be considered by the trial court because it has not been formally
offered, pursuant to Section 34, Rule 132 of the Rules of Court. As suggested by the CA, petitioner should have
instead moved for a new trial or reopening of the trial on the confiscation aspect, rather than a mere motion for
reconsideration.44

Finally, petitioner’s contention that it was deprived of its right to due process in the confiscation of F/V Sea Lion has
no factual basis. As correctly pointed out by the CA:
That the trial court concluded that no denial of due process occurred is likewise legally correct, perhaps not in the
exact way expressed in the assailed order, but for what the reason articulated in the assailed order directly implies.
As we discussed above, the petitioner did not intervene before the trial court to claim ownership of the fishing vessel,
nor were there records before the court showing a third-party claim of ownership of the vessel; the formal introduction
of evidence that would have formally brought the third-party ownership of the vessel to light was prevented by the
plea of guilt of the accused. There was therefore no third-party property right sought to be protected when the trial
court ordered the confiscation of the vessel.

Significantly, the lack of any factual basis for the third-party claim of ownership was not cured at all when the
petitioner filed its motion for reconsideration before the trial court. At that point, evidence should have been adduced
to support the petitioner’s claim (so that a new trial or reopening of the trial on the confiscation aspect should have
been prayed for, rather than a mere motion for reconsideration.) There is firstly the factual issue - to be proved by
proper evidence in order to be properly considered by the court - that the vessel is owned by a third party other than
the accused. Article 45 required too that proof be adduced that the third party is not liable for the offense. After the
admission by the accused through their guilty plea that the vessel had been used in the commission of a crime, we
believe and so hold that this additional Article 45 requirement cannot be simply inferred from the mere fact that the
alleged owner is not charged in the same case before the court.

It was under this legal situation that the trial court issued its assailed order that correctly concluded that there had
been no denial of due process. Given the absence of any admissible evidence of third-party ownership and the failure
to comply with the additional Article 45 requirement, the court’s order to confiscate the F/V Sea Lion pursuant to
Article 87 of R.A. No. 8550 cannot be incorrect to the point of being an act in grave abuse of discretion. 45

In fine, it has been established beyond reasonable doubt that F/V Sea Lion was used by the 17 Chinese fishermen in
the commission of the crimes. On the other hand, petitioner presented no evidence at all to support its claim of
ownership of F/V Sea Lion. Therefore, the forfeiture of F/V Sea Lion in favor of the government was proper.

WHEREFORE, the petition is DENIED. The Decision dated January 10, 2006 and the Resolution dated May 5, 2006
of the Court of Appeals in CA-G.R. SP No. 91270 are AFFIRMED.

SO ORDERED.

MARIANO C. DEL CASTILLO


Associate Justice
G.R. No. 194239 June 16, 2015

WEST TOWER CONDOMINIUM CORPORATION, on behalf of the Residents of West Tower Condominium and
in representation of Barangay Bangkal, and others, including minors and generations yet unborn,Petitioners,
vs.
FIRST PHILIPPINE INDUSTRIAL CORPORATION, FIRST GEN CORPORATION and their RESPECTIVE BOARD
OF DIRECTORS AND OFFICERS, JOHN DOES, and RICHARD DOES, Respondents.

DECISION

VELASCO, JR., J.:

Nature of the Case

Before the Court is the Petition for the Issuance of a Writ of Kalikasan filed following the leak in the oil pipeline owned
by First Philippine Industrial Corporation (FPIC) in Makati City. The Facts

Respondent FPI C operates two pipelines since 1969, viz: ( 1) the White Oil Pipeline (WOPL) System, which covers a
117-kilometer stretch from Batangas to the Pandacan Terminal in Manila and transports diesel, gasoline, jet fuel and
kerosene; and (b) the Black Oil Pipeline (BOPL) System which extends 105 kilometers and transports bunker fuel
from Batangas to a depot in Sucat, Parañaque. These systems transport nearly 60% of the petroleum requirements
of Metro Manila and parts of the provinces of Bulacan, Laguna, and Rizal.

The two pipelines were supposedly designed to provide more than double the standard safety allowance against
leakage, considering that they are made out of heavy duty steel that can withstand more than twice the current
operating pressure and are buried at a minimum depth of 1.5 meters, which is deeper than the US Department of
Transportation standard of 0.9 meters. In May 2010, however, a leakage from one of the pipelines was suspected
after the residents of West Tower Condominium (West Tower) started to smell gas within the condominium. A search
made on July 10, 2010 within the condominium premises led to the discovery of a fuel leak from the wall of its
Basement 2. Owing to its inability to control the flow, West Tower's management reported the matter to the Police
Department of Makati City, which in turn called the city's Bureau of Fire Protection.

What started as a two-drum leak at the initial stages became a 15-20 drum a day affair. Eventually, the sump pit of
the condominium was ordered shut down by the City of Makati to prevent the discharge of contaminated water into
the drainage system of Barangay Bangkal. Eventually, the fumes compelled the residents of West Tower to abandon
their respective units on July 23, 2010 and the condo's power was shut down.

Petitioner FPIC initially disowned any leak from its oil pipeline. Thus, the residents of West Tower shouldered the
expenses of hauling the waste water from its basement, which eventually required the setting up of a treatment plant
in the area to separate fuel from the waste water. On October 28, 2010, the University of the Philippines-National
Institute of Geological Sciences (UP-NIGS), which the City of Makati invited to determine the source of the fuel, found
a leak in FPIC's WOPL about 86 meters from West Tower.

A day after, or on October 29, 2010, FPIC admitted that indeed the source of the fuel leak is the WOPL, which was
already closed since October 24, 2010, but denied liability by placing blame on the construction activities on the
roads surrounding West Tower.

On November 15, 2010, West Tower Condominium Corporation (West Tower Corp.) interposed the present Petition
for the Issuance of a Writ of Kalikasan on behalf of the residents of West Tower and in representation of the
surrounding communities in Barangay Bangkal, Makati City. West Tower Corp. also alleged that it is joined by the
civil society and several people's organizations, non-governmental organizations and public interest groups who have
expressed their intent to join the suit because of the magnitude of the environmental issues involved. 1

In their petition, petitioners prayed that respondents FPIC and its board of directors and officers, and First Gen
Corporation (FGC) and its board of directors and officers be directed to: (1) permanently cease and desist from
committing acts of negligence in the performance of their functions as a common carrier; (2) continue to check the
structural integrity of the whole 117-kilometer pipeline and to replace the same; (3) make periodic reports on their
findings with regard to the 117-kilometer pipeline and their replacement of the same; (4) rehabilitate and restore the
environment, especially Barangay Bangkal and West Tower, at least to what it was before the signs of the leak
became manifest; and (5) to open a special trust fund to answer for similar and future contingencies in the future.
Furthermore, petitioners pray that respondents be prohibited from opening the pipeline and allowing the use thereof
until the same has been thoroughly checked and replaced, and be temporarily restrained from operating the pipeline
until the final resolution of the case.

To bolster their petition, petitioners argued that FPIC's omission or failure to timely replace. its pipelines and to
observe extraordinary diligence caused the petroleum spill in the City of Makati. Thus, for petitioners, the continued
use of the now 4 7-year old pipeline would not only be a hazard or a threat to the lives, health, and property of those
who live or sojourn in all the municipalities in which the pipeline is laid, but would also affect the rights of the
generations yet unborn to live in a balanced and "healthful ecology," guaranteed under Section 16, Article II of the
1987 Constitution.

On November 19, 2010, the Court issued the Writ of Kalikasan 2 with a Temporary Environmental Protection Order
(TEPO) requiring respondents FPIC, FGC, and the members of their Boards of Directors to file their respective
verified returns. The TEPO enjoined FPIC and FGC to: (a) cease and desist from operating the WOPL until further
orders; (b) check the structural integrity of the whole span of the 11 7-kilometer WOPL while implementing sufficient
measures to prevent and avert any untoward incident that may result from any leak of the pipeline; and ( c) make a
report thereon within 60 days from receipt thereof.

In compliance with the writ, FPIC directors Edgar Chua, Dennis Javier, Dennis Gamab and Willie Sarmiento
submitted a Joint Return3 praying for the dismissal of the petition and the denial of the privilege of the Writ of
Kalikasan. They alleged that: petitioners had no legal capacity to institute the petition; there is no allegation that the
environmental damage affected the inhabitants of two (2) or more cities or provinces; and the continued operation of
the pipeline should be allowed in the interest of maintaining adequate petroleum supply to the public.

Respondents FPIC and its directors and officers, other than the aforementioned four ( 4) directors, also filed a
Verified Return4 claiming that not all requirements for the issuance of the Writ of Kalikasan are present and there is
no showing that West Tower Corp. was authorized by all those it claimed to represent. They further averred that the
petition contains no allegation that respondents FPIC directors and officers acted in such a manner as to allow the
piercing of the corporate veil.

Meanwhile, on January 18, 201-1, FGC and the members of its Board of Directors and Officers filed a Joint
Compliance5 submitting the report required by the Writ of Kalikasan/TEPO. They contended that they neither own nor
operate the pipelines, adding that it is impossible for them to report on the structural integrity of the pipelines, much
less to cease and desist from operating them as they have no capability, power, control or responsibility over the
pipelines. They, thus, prayed that the directives of the Writ of Kalikasan/TEPO be considered as sufficiently
performed, as to them.

On January 21, 2011, FPIC, in compliance with the writ, submitted its 4-page "Report on Pipeline Integrity Check and
Preventive Maintenance Program."6 In gist, FPIC reported the following: (I) For the structural integrity of the 117-
kilometer pipeline, (a) the DOE engaged the services of UP-NIGS to do borehole testing on 81 pre-identified critical
areas of the WQPL in eight cities and municipalities-all the boreholes showed negative presence of petroleum
vapors; (b) pressure tests were conducted after the repair of the leak and results showed negative leaks and the
DOE's pipeline expert, Societe General de Surveillance, New Zealand, has developed a pressure test protocol
requiring a 24-hour operation of running a scraper pig through the pipeline to eliminate air gap; (c) In-Line Inspection
Test, was conducted by NDT through MFL and ultrasonic. The NDT later cleared the WOPL from any damage or
corrosion.

(II) For preventive maintenance measures, (a) Cathodic Protection Systems are installed involving the use of anode
materials and the introduction of electric current in the pipeline to enhance prevention of corrosion; (b) Regular
Scraper Runs through the pipeline to maintain cleanliness and integrity of the pipelines' internal surface; (c) Daily
Patrols every two hours of the pipeline route to deter unauthorized diggings in the vicinity of the pipeline segments; (
d) Regular coordination meetings with DPWH, MMDA and utility companies to monitor projects that might involve
digging or excavation in the vicinity of the pipeline segments; (e) Installation of Security Warning Signs along the
pipeline route with toll free number which can be called in the event of an accident or emergency; (f) Emergency
Response Procedure of the ERT is activated by a call-out procedure; (g) Maintenance of Emergency Equipment and
Repair Kit which are always on standby; and, (h) Remotely controlled Isolation Valves are in place to shut the pipeline
when necessary.
On February 9, 2011, petitioners filed, and the Court eventually granted, their Motion to Set the Case for Preliminary
Conference and Hearing7 pursuant to Sec. 11, Rule 7 of the Rules of Procedure for Environmental Cases.

On April 15, 2011, the Court conducted an ocular inspection of the WOPL in the vicinity of West Tower to determine
the veracity of the claim that there were two (2) additional leaks on FPIC's pipeline. Results of the ocular inspection
belied the claim.

In the meantime, petitioners also filed civil and criminal complaints against respondents arising from the same
incident or leakage from the WOPL.8

Since after the Court's issuance of the Writ of Kalikasan and the TEPO on November 19, 2010, FPIC has ceased
operations on both the WOPL and the BOPL. On May 31, 2011, however, the Court, answering a query of the DOE,
clarified and confirmed that what is covered by the Writ of Kalikasan and TEPO is only the WOPL System of FPIC;
thus, FPIC can resume operation of its BOPL System.9

On July 7, 2011, petitioners filed an Omnibus Motion10 assailing the Court's May 31, 2011 Resolution, praying for the
conduct of oral argument on the issue of reopening the BOPL System. This was followed, on September 9, 2011, by
a Manifestation (Re: Current Developments) with Omnibus Motion11 wherein petitioners invoked the precautionary
principle12 and asserted that the possibility of a leak in the BOPL System leading to catastrophic environmental
damage is enough reason to order the closure of its operation. They likewise alleged that the entities contracted by
FPIC to clean and remediate the environment are illegally discharging waste water, which had not undergone proper
treatment, into the Parañaque River. Petitioners, thus, prayed that respondents be directed to comply with
environmental laws in rehabilitating the surroundings affected by the oil leak and to submit a copy of their work plan
and monthly reports on the progress thereof. To these omnibus motions, respondents were directed to file their
respective comments.

On September 28, 2011, respondent FPIC filed an Urgent Motion for Leave (To Undertake "Bangkal Realignment"
Project)13 in order to reduce stress on the WOPL System. FPIC sought to construct a new realigned segment to
replace the old pipe segment under the Magallanes Interchange, which covers the portion that leaked. Petitioners
were directed to file their comment on FPIC's motion.

Report and Recommendation of the Court of Appeals

To expedite the resolution of the controversy, the Court remanded the case to the Court of Appeals (CA). By this
Court's Resolution dated November 22, 2011,14 the appellate court was required to conduct hearings and, thereafter,
submit a report and recommendation within 30 days after the receipt of the parties' memoranda.

On March 21, 2012, the preliminary conference was continued before the CA wherein the parties made admissions
and stipulations of facts and defined the issues for resolution. In view of the technical nature of the case, the CA also
appointed15 several amici curiae,16 but only four (4) filed their reports.17

On December 26, 2012, the CA Former 11th Division submitted to the Court its well-crafted and exhaustive 156-page
Report and Recommendation18 dated December 21, 2012 (CA Report). Some highlights of the Report:

1. Anent petitioners' June 28, 2011 Omnibus Motion assailing the reopening of the BOPL System, the CA
directed respondent FPIC to submit the appropriate certification from the DOE as to the safe commercial
operation of the BOPL; otherwise, the operation of the BOPL must also be enjoined.

2. On petitioners' September 9, 2011 Manifestation (Re: Current Developments) with Omnibus Motion, the
CA directed the Inter-Agency Committee on Health to submit its evaluation of the remediation plan prepared
by CH2M Hill Philippines, Inc. for FPIC. Further, the appellate court directed FPIC to strictly comply with the
stipulations contained in the permits issued by the Department of Environment and Natural Resources
(DENR) for its remediation activities in Barangay Bangkal, Makati City. The DENR was in turn directed by
the CA to:

(a) monitor compliance by respondent FPIC with applicable environmental laws and regulations
and conditions set forth in the permits issued;
(b) conduct independent analysis of end-products of the Multi-Phase Extraction System;

(c) conduct regular consultative meetings with the City of Makati, residents of Barangay Bangkal
and other stakeholders concerning the remediation activities; and,

(d) evaluate the viability of the recommendation of amicus Dr. Benjamin R. De Jesus, Jr. to include
the use of surfactants and oxygen-releasing compounds (ORCs) in the middle and terminal
portions of the remediation plan.

3. Respondent's September 27, 2011 Urgent Motion for Leave (To Undertake "Bangkal Realignment"
Project) was denied.

4. With regard to the March 29, 2012 Supplemental Manifestation (Re: List of Amici Curiae and Recent
Possible Leak in the Pipeline) filed by petitioners, the CA found that the existence of another possible leak
alleged by petitioners was not established. Nonetheless, to prevent such event, the CA ordered FPIC to: (i)
review, adopt and strictly observe appropriate safety and precautionary measures; (ii) closely monitor the
conduct of its maintenance and repair works; and (iii) submit to the DOE regular monthly reports on the
structural integrity and safe commercial operation of the pipeline.

5. As to the merits of the case, the CA submitted the following recommendations:

(a) That the people's organizations, non-governmental organizations, and public interest groups
that indicated their intention to join the petition and submitted proof of juridical personality (namely:
the Catholic Bishop's Conference of the Philippines; Kilusang Makabansang Ekonomiya, Inc.;
Women's Business Council of the Philippines, Inc.; Junior Chambers International Philippines, Inc. -
San Juan Chapter; Zonta Club of Makati Ayala Foundations; and the Consolidated Mansions
Condominium Corporation) be allowed to be formally impleaded as petitioners.

(b) That respondent FPIC be ordered to submit a certification from the DOE Secretary that the
WOPL is already safe for commercial operation. The certification should take into consideration the
adoption by FPIC of the appropriate leak detection system to be used in monitoring the entire
pipeline's mass input versus mass output. The certification must also consider the necessity of
replacing the pipes with existing patches and sleeves. In case of failure of respondent FPIC to
submit the required certification from the DOE Secretary within sixty (60) days from notice of the
Honorable Supreme Court's approval of this recommendation, the TEPO must be made
permanent.

(c) That petitioners' prayer for the creation of a special trust fund to answer for similar contingencies
in the future be denied for lack of sufficient basis.

d) That respondent FGC be not held solidarily liable under the TEPO.

(e) That without prejudice to the outcome of the civil and criminal cases filed against respondents,
the individual directors and officers of FPIC and FGC be not held liable in their individual capacities.

On January 11, 2013, petitioners filed their Motion for Partial Reconsideration 19 of the CA's Report praying that (a)
instead of the DOE, the required certification should be issued by the DOST-Metal Industry Research and
Development Center; (b) a trust fund be created to answer for future contingencies; and ( c) the directors and officers
of FPIC and FGC be held accountable.

On January 25, 2013, FPIC filed its Compliance (Re: Department of Energy Certification on the Black Oil
Pipeline)20and submitted the required DOE Certification21 issued on January 22, 2013 by DOE Secretary Carlos
Jericho L. Petilla (Secretary Petilla). On March 14, 2013, petitioners countered with a Manifestation with
Motion22 asserting that FPIC's certification is not compliant with the CA's requirement. Hence, petitioners moved that
the certification should be disregarded, the 30-day period be deemed to have lapsed, and FPIC be permanently
enjoined from operating the BOPL.
On July 30, 2013, the Court issued a Resolution adopting the recommendation of the CA in its Report and
Recommendation that FPIC be ordered to secure a certification from the DOE Secretary before the WOPL may
resume its operations. The pertinent portion of said Resolution reads:

[FPIC] is hereby ORDERED to submit a certification from the DOE Secretary that the pipeline is already safe for
commercial operation. The certification should take into consideration the adoption by FPIC of the appropriate leak
detection system to be used in monitoring the entire pipeline's mass input versus mass output. The certification must
also consider the necessity of replacing the pipes with existing patches and sleeves x x x.23

The DOE Secretary is DIRECTED to consult the [DOST] regarding the adoption of the appropriate leak detection
system and the necessity of replacing the pipes with existing patches and sleeves.

On October 2, 2013, petitioners, in a Motion for Reconsideration with Motion for Clarification, emphasized that the CA
found FPIC's tests and maintenance program to be insufficient and inconclusive to establish the WOPL' s structural
integrity for continued commercial operation.24 Furthermore, petitioners point out that the DOE is biased and
incapable of determining the WOPL's structural integrity.

Respondents, for their part, maintain that the DOE has the technical competence and expertise to assess the
structural integrity of the WOPL and to certify the system's safety for commercial operation.25 Respondents further
allege that the DOE is the agency empowered to regulate the transportation and distribution of petroleum products,
and to regulate and monitor downstream oil industry activities, including "product distribution" through pipelines. 26

In compliance with the Court's July 30, 2013 Resolution, the DOE Secretary issued on October 25, 2013 a
Certification,27 attesting that the WOPL is safe to resume commercial operations, subject to monitoring or inspection
requirements, and imposing several conditions that FPIC must comply with. The Certification, in its entirety, reads:

This is to certify that based on the Pipeline Integrity Management Systems (PIMS) being implemented by [FPIC] for
its [WOPL] facility, the same is safe to resume commercial operations. This certification is being issued after
consultation with the [DOST] and on the basis of the following considerations, to wit:

1. DOE noted the adoption by FPIC of the appropriate leak detection system to be used in monitoring the
pipeline's mass input versus mass output, as well as the other measures of leak detection and prevention
adopted by the latter;

2. DOE further noted that FPIC has already undertaken realignment and reinforcement works on the current
pipeline to remove majority of the patches. FPIC has likewise presented substantial and adequate
documentation showing that the remaining patches and sleeves are safe, and that the use of such is
recognized by the industry and complies with existing standards;

3. DOE finally noted the results of various tests and inspections done on the pipeline as indicated in the
Manifestation submitted by ,the DOE on March 31, 2012, in the civil case docketed as CA GR SP No. 00008
and entitled West Tower Condominium, et al. [v.] First Philippine Industrial Corporation, et al.

This certification is being issued subject to the condition that FPIC will submit itself to regular monitoring and
validation by the Oil Industry Management Bureau (OIMB) of the implementation of its PIMS, particularly on the
following: (a) mass or volume input versus mass or volume output loss/gain accounting; (b) results of borehole
monitoring, (c) inspection of the pipeline cathodic protection and (d) pressure test.

Further, FPIC shall submit itself to any test or inspection that the DOE and DOST may deem appropriate for purposes
of monitoring the operations of the WOPL facility.

The Court is fully cognizant of the WOPL' s value in commerce and the adverse effects of a prolonged closure
thereof. Nevertheless, there is a need to balance the necessity of the immediate reopening of the WOPL with the
more important need to ensure that it is sound for continued operation, since the substances it carries pose a
significant hazard to the surrounding population and to the environment. 28 A cursory review of the most recent oil
pipeline tragedies around the world will readily show that extreme caution should be exercised in the monitoring and
operation of these common carriers:
(1) On August 1, 2014, a series of powerful explosions from underground pipeline systems ripped up the
streets of Kaohsiung, Taiwan, killing at least 28 people and injuring 299 more. Further, 23 ,600, 2,268 and
6,000 households were left without gas, power and water, respectively, in the 2-3 square kilometer blast
area.29

(2) On November 22, 2013, an oil pipeline leaked, caught fire, and exploded in Qingdao, Shangdao Province
in China, killing 55 people and injuring more than a hundred more. 30

(3) On September 14, 2011, a fuel pipeline exploded in Kenya's capital city, Nairobi, reducing bodies to dust
and flattening homes. At least 7 5 people died in the explosion, while more than a hundred people were
injured.31

(4) In September 2010, a natural gas pipeline ruptured and set off a fireball, killing eight (8) people and
leveling 3 8 homes in San Bruno, California in the United States. 32

(5) On July 30, 2004, a rupture of an underground natural gas pipeline buried six (6) meters in Ghislenghien,
Belgium resulted in 24 deaths and over 120 injuries.33

On April 29 and 30, 2014, the DOE organized a dialogue between said government agencies and the FPIC. There it
was stated that during the dialogue, "the division heads and a high profile team from FPIC, both from operation and
management made presentations and answered questions on pipeline pumping operation and product delivery, and
a detailed explanation of the FPIC PIMS' control measures, condition monitoring measures, and emergency
measures, as well as its various activities and projects implemented since 2010 such as pipeline replacement and
realignment in Pandacan and Bangkal, inspection and reinforcement of all patches in the WOPL, inspection and
reinforcement of a number of reported dents in the WOPL, conduct of successful leak tests, and installation of
boreholes that are gas-tested on a weekly basis, and the safety systems that go with the daily pipeline operation and
maintenance and project execution."34

On August 5, 2014, Secretary Carlos Jericho L. Petilla of the DOE submitted a letter 35 recommending activities and
timetable for the resumption of the WOPL operations, to wit:

A. Preparatory to the Test Run

I. FPIC Tasks:

a. Continue submission of monitoring charts, data/reading, accomplishment reports, and project status for all
related activities/works. Respond to comments and prepare for site inspection.

b. Continue gas testing along the right-of-way using the monitoring wells or boreholes. Prepare for
inspection of right-of-way and observation of gas testing activities on monitoring wells and boreholes.

c. Expound on the selection of borehole location. For example, identify those located in pipeline bends,
bodies of water, residential areas, repaired portions of the pipelines, dents and welded joints.

d. Continue submitting status report relating to "Project Mojica" (an ongoing pipeline segment realignment
activity undertaken by FPIC to give way to a flood control project of MMDA in the vicinity of Mojica St. and
Pres. Osmeña Highway in Makati City). Prepare for site inspection.

II. Inter-agency undertaking:

a. Conduct onsite inspection of right-of-way

b. Review/check remaining 22 patches that were already inspected and reinforced with Clockspring sleeves.

i. Determine location of sleeves.


ii. Review of procedures on repair of sleeves.

iii. Random visual inspection of areas easily accessible.

c. Cathodic protection's onsite inspection on rectifier to check readings

i. Old readings

ii. Current Readings

iii. Segment covered

iv. Criteria for prioritization for corrective action

d. Observe and witness the running/operation of the cleaning pig.

e. Check and validate all calibration certificate of instruments

i. Instrument verification and calibration.

B. Actual Test Run (to be undertaken both by FPIC and inter-agency)

a. Perform Cleaning Pig Run

i. Witness launching and receiving of the cleaning pig.

ii. Handling of the residuals after cleaning.

b. Demonstrate Various Pressure Tests (already being conducted by FPIC)

i. Blocked-in pressure test (Leak Test, not in operation)

ii. In-operation (hourly reading)

c. Continue Current Gas Monitoring (boreholes)

i. Ocular inspection of selected areas

d. Demonstrate mass or volume balance computation during WOPL test run (already being implemented in
the BOPL)

i. 30 days baseline data generation

ii. 30 days computational analysis and monitoring

C. Commissioning or Return to Commercial Operation

I. FPIC Tasks:

a. Continue implementation of the PIMS. Review recommendations from DOE.

b. Continue monthly reporting of operations and maintenance activities with DOE.


c. Continue reporting and coordination with DOE and other government agencies for implementation of
projects.36

Secretary Petilla also recounted to the Court in his August 5, 2014 letter that the DOE, together with the DPWH and
the Metropolitan Manila Development Authority (MMDA), observed the different milestones of the realignment project
being undertaken by FPIC in support of the MMDA Flood Control Project and stated that the new line segment as laid
was coated with corrosion protection prior to the backfilling of the excavated portion.

On February 3, 2015, the Court required the parties to submit their comment on Sec. Petilla's letter within ten (10)
days from receipt of the Resolution. On various dates, respondents First Gen Corporation, FPIC, and petitioner West
Tower filed their respective comments37 in compliance with the Court's resolution. The intervenors were unable to
comply with the Court's directive; hence, they are deemed to have waived their right to file their respective comments.
The Issues

Having received the October 25, 2013 Certification and the August 5, 2014 Letter from the DOE on the state of the
WOPL, as well as the parties' comments thereon, the following issues defined by the parties during the March 21,
2012 preliminary conference are now ripe for adjudication:

1. Whether petitioner West Tower Corp. has the legal capacity to represent the other petitioners and
whether the other petitioners, apart from the residents of West Tower and Barangay Bangkal, are real
parties-in-interest;

2. Whether a Permanent Environmental Protection Order should be issued to direct the respondents to
perform or to desist from performing acts in order to protect, preserve, and rehabilitate the affected
environment;

3. Whether a special trust fund should be opened by respondents to answer for future similar contingencies;
and

4. Whether FGC and the directors and officers of respondents FPIC and FGC may be held liable under the
environmental protection order.38

The Court's Ruling

We adopt, with modifications, the recommendations of the CA and discuss the foregoing issues in seriatim.

I.
Petitioners as Real Parties-in-Interest

On the procedural aspect, We agree with the CA that petitioners who are affected residents of West Tower and
Barangay Bangkal have the requisite concern to be real parties-in-interest to pursue the instant petition.

Residents of West Tower and Barangay Bangkal

As defined, a real party-in-interest is the party who stands to be benefited or injured by the judgment in the suit, or the
party entitled to the avails of the suit.39 Generally, every action must be prosecuted or defended in the name of the
real parties-in-interest.40 In other words, the action must be brought by the person who, by substantive law,
possesses the right sought to be enforced.41 Alternatively, one who has no right or interest to protect cannot invoke
the jurisdiction of the court as party-plaintiff-in-action for it is jurisprudentially ordained that every action must be
prosecuted or defended in the name of the real party-in-interest.42

In the case at bar, there can be no quibble that the oil leak from the WOPL affected all the condominium unit owners
and residents of West Tower as, in fact, all had to evacuate their units at the wee hours in the morning of July 23,
2010, when the condominium's electrical power was shut down. Until now, the unit owners and residents of West
Tower could still not return to their condominium units. Thus, there is no gainsaying that the residents of West Tower
are real parties-in-interest.
There can also be no denying that West Tower Corp. represents the common interest of its unit owners and
residents, and has the legal standing to file and pursue the instant petition. While a condominium corporation has
limited powers under RA 4 726, otherwise known as The Condominium Act,43 it is empowered to pursue actions in
behalf of its members. In the instant case, the condominium corporation .is the management body of West Tower and
deals with everything that may affect some or all of the condominium unit owners or users.

It is of no moment that only five residents of West Tower signed their acquiescence to the filing of the petition for the
issuance of the Writ of Kalikasan, as the merits of such petition is, as aptly put by the CA, not measured by the
number of persons who signified their assent thereto, but on the existence of a prima facie case of a massive
environmental disaster.

Moreover, the fact that no board resolution was submitted by West Tower Corp. authorizing Manuel Dy Chuaunsu, Jr.
to sign the Verification and Certification of Non-forum Shopping is irrelevant. The records show that petitioners
submitted a notarized Secretary's Certificate44 attesting that the authority of Chuaunsu to represent the condominium
corporation in filing the petition is from the resolution of the total membership of West Tower Corp. issued during their
November 9, 2010 meeting with the requisite quorum. It is, thus, clear that it was not the Board of West Tower Corp.
which granted Chuaunsu the authority but the full membership of the condominium corporation itself.

As to the residents of Barangay Bangkal, they are similarly situated with the unit owners and residents of West Tower
and are real parties-in-interest to the instant case, i.e., if they so wish to join the petitioners.

Organizations that indicated their intention to join the petition

and submitted proof of juridical personality

Anent the propriety of including the Catholic Bishops' Conference of the Philippines, Kilusang Makabansang
Ekonomiya, Inc., Women's Business Council of the Philippines, Inc., Junior Chambers International Philippines, Inc. -
San Juan Chapter, Zonta Club of Makati Ayala Foundations, and the Consolidated Mansions Condominium
Corporation, as petitioners in the case, the Court already granted their intervention in the present controversy in the
adverted July 30, 2013 Resolution.

This is so considering that the filing of a petition for the issuance of a writ of kalikasan under Sec. 1, Rule 7 45 of the
Rules of Procedure for Environmental Cases does not require that a petitioner be directly affected by an
environmental disaster. The rule clearly allows juridical persons to file the petition on behalf of persons whose
constitutional right to a balanced and healthful ecology is violated, or threatened with violation.

Thus, as parties to the case, they are entitled to be furnished copies of all the submissions to the Court, including the
periodic reports of FPIC and the results of the evaluations and tests conducted on the WOPL.

Having disposed of the procedural issue, We proceed to the bone of contention in the pending motions. Suffice it to
state in the outset that as regards the substantive issues presented, the Court, likewise, concurs with the other
recommendations of the CA, with a few modifications.

II.
Propriety of Converting the TEPO to PEPO or its Lifting in light of the

DOE Certification of the WOPL's Commercial Viability

To recall, petitioners' persistent plea is for the conversion of the November 19, 2010 TEPO into a Permanent
Environmental Protection Order (PEPO) pursuant to Sec. 3,46 Rule 5 of the Rules of Procedure for Environmental
Cases. For its part, respondent FPIC asserts that regular testing, as well as the measures that are already in place,
will sufficiently address any concern of oil leaks from the WOPL.

With respect to leak detection, FPIC claims that it has in place the following systems: (a) regular cleaning scraper
runs, which are done quarterly; (b) pipeline integrity gauge (PIG) tests/Intelligent PIG, now known as in-line
inspections (ILI), which is done every five years; (c) pressure monitoring valves; and ( d) 24-hour patrols. Additionally,
FPIC asserted that it also undertook the following: (a) monitoring of wells and borehole testing/vapor tests; (b) leak
tightness test, also known as segment pressure test; (c) pressure-controlled test; (d) inspection and reinforcement of
patches; (e) inspection and reinforcement of dents; and (f) Pandacan segment replacement. 47Furthermore, in August
2010, with the oil leak hogging the headlines, FPIC hired NDT Middle East FZE (NDT) to conduct ILI inspections
through magnetic flux leakage (MFL) and ultrasonic tests to, respectively, detect wall thinning of the pipeline and
check it for cracks.

The CA, however, observed that all of these tests and measures are inconclusive and insufficient for purposes of leak
detection and pipeline integrity maintenance. Hence, considering the necessary caution and level of assurance
required to ensure that the WOPL system is free from leaks and is safe for commercial operation, the CA
recommended that FPIC obtain from the DOE a certification that the WOPL is already safe for commercial operation.
This certification, according to the CA, was to be issued with due consideration of the adoption by FPIC of the
appropriate leak detection systems to monitor sufficiently the entire WOPL and the need to replace portions of the
pipes with existing patches and sleeves. Sans the required certification, use of the WOPL shall remain abated.

The Court found this recommendation of the appellate court proper. Hence, We required FPIC to obtain the adverted
DOE Certification in Our July 30, 2013 Resolution. We deemed it proper to require said certification from the DOE
considering that the core issue of this case requires the specialized knowledge and special expertise of the DOE and
various other administrative agencies. On October 25, 2013, the DOE submitted the certification pursuant to the July
30, 2013 Resolution of the Court. Later, however, on August 5, 2014, DOE Secretary Carlos Jericho I. Petilla
submitted a letter recommending certain activities and the timetable for the resumption of the WOPL operations after
conducting a dialogue between the concerned government agencies and FPIC.

After a perusal of the recommendations of the DOE and the submissions of the parties, the Court adopts the activities
and measures prescribed in the DOE letter dated August 5, 2014 to be complied with by FPIC as conditions for the
resumption of the commercial operations of the WOPL. The DOE should, therefore, proceed with the implementation
of the tests proposed in the said August 5, 2014 letter. Thereafter, if it is satisfied that the results warrant the
immediate reopening of the WOPL, the DOE shall issue an order allowing FPIC to resume the operation of the
WOPL. On the other hand, should the probe result in a finding that the pipeline is no longer safe for continued use
and that its condition is irremediable, or that it already exceeded its serviceable life, among others, the closure of the
WOPL may be ordered.

The DOE is specially equipped to consider FPIC's proper implementation and compliance with its PIMS and to
evaluate the result of the various tests conducted on the pipeline. The DOE is empowered by Sec. 12(b)(l), RA 7638
to formulate and implement policies for the efficient and economical "distribution, transportation, and storage of
petroleum, coal, natural gas."48 Thus, it cannot be gainsaid that the DOE possesses technical knowledge and special
expertise with respect to practices in the transportation of oil through pipelines.

Moreover, it is notable that the DOE did not only limit itself to the knowledge and proficiency available within its
offices, it has also rallied around the assistance of pertinent bureaus of the other administrative agencies: the ITDI 49of
the DOST, which is mandated to undertake technical services including standards, analytical and calibration services;
the MIRDC,50 also of the DOST, which is the sole government entity directly supporting the metals and engineering
industry;51 the EMB52 of the DENR, the agency mandated to implement, among others, RA 6969 (Toxic Substances
and Hazardous and Nuclear Waste Control Act of 1990) and RA 9275 (Philippine Clean Water Act of 2004); and the
BOD of the DPWH, which is mandated to conduct, supervise, and review the technical design aspects of projects of
government agencies.53

The specialized knowledge and expertise of the foregoing agencies must, therefore, be availed of to arrive at a
judicious decision on the propriety of allowing the immediate resumption of the WOPL's operation. In a host of cases,
this Court held that when the adjudication of a controversy requires the resolution of issues within the expertise of an
administrative body, such issues must be investigated and resolved by the administrative body equipped with the
specialized knowledge and the technical expertise. 54 Hence, the courts, although they may have jurisdiction and
power to decide cases, can utilize the findings and recommendations of the administrative agency on questions that
demand "the exercise of sound administrative discretion requiring the special knowledge, experience, and services of
the administrative tribunal to determine technical and intricate matters of fact." 55

Justice Leonen, in his dissent, is of the view that the petition should be denied and the TEPO immediately lifted in
light of the DOE's issuance of a certification attesting to the safety of the WOPL for continued commercial operations,
thereby rendering the instant petition moot and academic, seeking, as it does, the checking of the pipeline's structural
integrity. According to his dissent, the writ of kalikasan issued by the Court has already served its functions and,
therefore, is functus officio. Moreover, he argues that directing the DOE and FPIC to repeat their previous procedures
is tantamount to doubting the agency's performance of its statutorily-mandated tasks, over which they have the
necessary expertise, and implies that said DOE certification is improper, a breach, allegedly, of the principle of
separation of powers.

He also contends that the majority ordered the repetition of the procedures and tests already conducted on the
WOPL because of the fear and uncertainty on its safeness despite the finding of the DOE in favor of its reopening,
taking into consideration the occurrence of numerous pipeline incidents worldwide. The dissent argues that the
precautionary principle should not be so strictly applied as to unjustifiably deprive the public of the benefits of the
activity to be inhibited, and to unduly create other risks.

The dissent's contentions that the case is already moot and academic, that the writ of kalikasan has already served
its function, and that the delay in the lifting of the TEPO may do more harm than good are anchored on the mistaken
premise that the precautionary principle was applied in order to justify the order to the DOE and the FPIC for the
conduct of the various tests anew. The following reasons easily debunk these arguments:

1. The precautionary principle is not applicable to the instant case;

2. The DOE certification is not an absolute attestation as to the WOPL's structural integrity and in fact
imposes several conditions for FPIC's compliance;

3. The DOE itself, in consultation with FPIC and the other concerned agencies, proposed the activities to be
conducted preparatory to the reopening of the pipeline; and

4 . There are no conclusive findings yet on the WOPL's structural integrity.

Section 1, Rule 20 of A.M. No. 09-6-8-SC or the Rules of Procedure for Environmental Cases, on the Precautionary
Principle, provides that "[ w ]hen there is lack of full scientific certainty in establishing a causal link between human
activity and environmental effect, the court shall apply the precautionary principle in resolving the case before it."

According to the dissent, the directive for the repetition of the tests is based on speculations, justified by the
application of said principle. This, however, is not the case. Nowhere did We apply the precautionary principle in
deciding the issue on the WOPL's structural integrity.

The precautionary principle only applies when the link between the cause, that is the human activity sought to be
inhibited, and the effect, that is the damage to the environment, cannot be established with full scientific certainty.
Here, however, such absence of a link is not an issue. Detecting the existence of a leak or the presence of defects in
the WOPL, which is the issue in the case at bar, is different from determining whether the spillage of hazardous
materials into the surroundings will cause environmental damage or will harm human health or that of other
organisms. As a matter of fact, the petroleum leak and the harm that it caused to the environment and to the
residents of the affected areas is not even questioned by FPIC.

It must be stressed that what is in issue in the instant petition is the WOPL's compliance with pipeline structure
standards so as to make it fit for its purpose, a question of fact that is to be determined on the basis of the evidence
presented by the parties on the WOPL's actual state. Hence, Our consideration of the numerous findings and
recommendations of the CA, the DOE, and the amici curiae on the WOPL' s present structure, and not the cited
pipeline incidents as the dissent propounds.

Consider also the fact that it is the DOE itself that imposed several conditions upon FPIC for the resumption of the
operations of the WOPL. This, coupled with the submission by the DOE of its proposed activities and timetable, is a
clear and unequivocal message coming from the DOE that the WOPL's soundness for resumption of and continued
commercial operations is not yet fully determined. And it is only after an extensive determination by the DOE of the
pipeline's actual physical state through its proposed activities, and not merely through a short-form integrity
audit,56that the factual issue on the WOPL's viability can be settled. The issue, therefore, on the pipeline's structural
integrity has not yet been rendered moot and remains to be subject to this Court's resolution. Consequently, We
cannot say that the DOE's issuance of the certification adverted to equates to the writ of kalikasan being functus
officio at this point.

The dissent is correct in emphasizing that We defer to the findings of fact of administrative agencies considering their
specialized knowledge in their field. And We, as a matter of fact, acceded to the DOE' s conclusions on the necessity
of the conduct of the various activities and tests enumerated in Sec. Petilla's letter to this Court dated August 5, 2014.
Hence, Our directive for the DOE to immediately commence the activities enumerated in said Letter, to determine the
pipeline's reliability, and to order its reopening should the DOE find that such is proper.

The dissent also loses sight of the fact that the petition not only seeks the checking of the WOPL's structural integrity,
but also prays for the rehabilitation of the areas affected by the leak, the creation of a special trust fund, the
imposition of liability upon the directors of FPIC, among others. These issues, undoubtedly, are matters that are not
addressed by the DOE certification alone. Furthermore, these are issues that no longer relate to the WOPL' s
structure but to its maintenance and operations, as well as to the residues of the incident. It will, thus, be improper for
Us to simply dismiss the petition on the basis solely of the alleged resolution of only one of several issues, which
purportedly renders the issue on the WOPL' s soundness moot, without disposing of the other issues presented.

Lastly, any delay in the reopening of the WOPL, if said delay is for the purpose of making sure that the pipeline is
commercially viable, is better than hastily allowing its reopening without an extensive check on its structural integrity
when experience shows that there were and may still be flaws in the pipeline. Even the DOE, the agency tasked to
oversee the supply and distribution of petroleum in the country, is well aware of this and even recommended the
checking of the patched portions of the pipeline, among others. In this regard, the Court deems it best to take the
necessary safeguards, which are not similar to applying the precautionary principle as previously explained, in order
to prevent a similar incident from happening in the future.

III.
Propriety of the Creation of a Special Trust Fund

Anent petitioners' prayer for the creation of a special trust fund, We note that under Sec. 1, Rule 5 of the Rules of
Procedure for Environmental Cases, a trust fund is limited solely for the purpose of rehabilitating or restoring the
environment. Said proviso pertinently provides:

SEC. 1. Reliefs in a citizen suit. - If warranted, the court may grant to the plaintiff proper reliefs which shall include the
protection, preservation or rehabilitation of the environment and the payment of attorney's fees, costs of suit and
other litigation expenses. It may also require the violator to submit a program of rehabilitation or restoration of the
environment, the costs of which shall be borne by the violator, or to contribute to a special trust fund for that purpose
subject to the control of the court. (emphasis supplied)

Furthermore, Sec. 15( e ), Rule 7 of the Rules of Procedure for Environmental Cases expressly prohibits the grant of
damages to petitioners in a petition for the issuance of a writ of kalikasan, viz:

Section 15. Judgment. - Within sixty (60) days from the time the petition is submitted for decision, the court shall
render judgment granting or denying the privilege of the writ of kalikasan.

The reliefs that may be granted under the writ are the following:

xxxx

(e) Such other reliefs which relate to the right of the people to a balanced and healthful ecology or to the protection,
preservation, rehabilitation or restoration of the environment, except the award of damages to individual petitioners.

A reading of the petition and the motion for partial reconsideration readily reveals that the prayer is for the creation of
a trust fund for similar future contingencies. This is clearly outside the limited purpose of a special trust fund under the
Rules of Procedure for Environmental Cases, which is to rehabilitate or restore the environment that has presumably
already suffered. Hence, the Court affirms with concurrence the observation of the appellate court that the prayer is
but a claim for damages, which is prohibited by the Rules of Procedure for Environmental Cases. As such, the Court
is of the considered view that the creation of a special trust fund is misplaced. The present ruling on petitioners'
prayer for the creation of a special trust fund in the instant recourse, however, is without prejudice to the judgment/s
that may be rendered in the civil and/or criminal cases filed by petitioners arising from the same incident if the
payment of damages is found warranted.

IV.
Liability of FPIC, FGC and their respective Directors and Officers
On the last issue of the liability of FPIC, FGC and their respective directors and officers, the CA found FGC not liable
under the TEPO and, without prejudice to the outcome of the civil case (Civil Case No. 11-256, RTC, Branch 58 in
Makati City) and criminal complaint (Complaint-Affidavit for Reckless Imprudence, Office of the Provincial Prosecutor
of Makati City) filed against them, the individual directors and officers of FPIC and FGC are not liable in their
individual capacities.

The Court will refrain from ruling on the finding of the CA that the individual directors and officers of FPIC and FGC
are not liable due to the explicit rule in the Rules of Procedure for Environmental cases that in a petition for a writ of
kalikasan, the Court cannot grant the award of damages to individual petitioners under Rule 7, Sec. 15(e) of the
Rules of Procedure for Environmental Cases. As duly noted by the CA, the civil case and criminal complaint filed by
petitioners against respondents are the proper proceedings to ventilate and determine the individual liability of
respondents, if any, on their exercise of corporate powers and the management of FPIC relative to the dire
environmental impact of the dumping of petroleum products stemming from the leak in the WOPL in Barangay
Bangkal, Makati City.

Hence, the Court will not rule on the alleged liability on the part of the FPIC and FGC officials which can, however, be
properly resolved in the civil and criminal cases now pending against them.

Other Matters

The CA's resolution on petitioners' September 9, 2011 Manifestation (Re: Current Developments) with Omnibus
Motion on the remediation plan in Barangay Bangkal by directing the Inter-Agency Committee on Environmental
Health to submit its evaluation of the said plan prepared by CH2M Philippines, Inc., for FPIC to strictly comply with
the stipulations embodied in the permits issued by the DENR, and to get a certification from the DENR of its
compliance thereto is well taken. DENR is the government agency tasked to implement the state policy of
"maintaining a sound ecological balance and protecting and enhancing the quality of the environment" 57 and to
"promulgate rules and regulations for the control of water, air, and land pollution."58 It is indubitable that the DENR
has jurisdiction in overseeing and supervising the environmental remediation of Barangay Bangkal, which is
adversely affected by the leak in the WOPL in 2010.

With regard to petitioners' March 29, 2012 Supplemental Manifestation about a recent possible leak in the pipeline,
the CA appropriately found no additional leak. However, due to the devastating effect on the environs in Barangay
Bangkal due to the 2010 leak, the Court finds it fitting that the pipeline be closely and regularly monitored to obviate
another catastrophic event which will prejudice the health of the affected people, and to preserve and protect the
environment not only for the present but also for the future generations to come.

Petitioner's January 10, 2013 Motion for Partial Recommendation of the CA' s Report need not be discussed and
given consideration. As the CA' s Report contains but the appellate court's recommendation on how the issues
should be resolved, and not the adjudication by this Court, there is nothing for the appellate court to reconsider.

As to petitioner's October 2, 2013 Motion for Reconsideration with Motion for Clarification, the matters contained
therein have been considered in the foregoing discussion of the primary issues of this case. With all these, We need
not belabor the other arguments raised by the parties.

IN VIEW OF THE FOREGOING, the Motion for Partial Reconsideration is hereby DENIED. The Motion for
Reconsideration with Motion for Clarification is PARTLY GRANTED. The Court of Appeals' recommendations,
embodied in its December 21, 2012 Report and Recommendation, are hereby ADOPTED with the following
MODIFICATIONS:

I. The Department of Energy (DOE) is hereby ORDERED to oversee the strict implementation of the following
activities:

A. Preparatory to the Test Run of the entire stretch of the WOPL:

1) FPIC shall perform the following:


a. Continue submission of monitoring charts, data/reading, accomplishment reports, and
project status for all related activities/works. Respond to comments and prepare for site
inspection.

b. Continue gas testing along the right-of-way using the monitoring wells or boreholes.
Prepare for inspection of right-of-way and observation of gas testing activities on
monitoring wells and boreholes.

c. Explain the process of the selection of borehole location and identify those located in
pipeline bends, bodies of water, highways, residential areas, repaired portions of the
pipelines, dents and welded joints, as well other notable factors, circumstances, or
exposure to stresses. d. Set up additional boreholes and monitoring wells sufficient to
cover the entire stretch of the WOPL, the number and location of which shall be
determined by the DOE.

e. Continue submitting status report to the concerned government agency/ies relating to


"Project Mojica," or the on-going pipeline segment realignment activity being undertaken
by FPIC to give way to a flood control project of the MMDA in the vicinity of Mojica St. and
Pres. Osmeña Highway, and prepare for site inspection.

2) The DOE shall perform the following undertakings:

a. Conduct onsite inspection of the pipeline right-of-way, the area around the WOPL and
the equipment installed underground or aboveground.

b. Review and check the condition of the 22 patches reinforced with Clockspring sleeves
by performing the following:

i. Determine the location of the sleeves

ii. Review the procedure for the repair of the sleeves

iii. Inspect the areas where the affected portions of the WOPL are located and
which are easily accessible.

c. Inspect onsite the cathodic protection rectifier to check the following:

i. old and current readings

ii. the segment/s covered by the cathodic protection system

iii. review the criteria for prioritization of corrective action.

d. Observe and witness the running/operation of the intelligent and cleaning pigs.

e. Check and calibrate the instruments that will be used for the actual tests on the
pipeline, and validate the calibration certificates of these instruments.

B. During the Actual Test Run:

1) FPIC shall perform the following:

a. Perform Cleaning Pig run and witness the launching and receiving of the intelligent and
cleaning pigs.
b. Demonstrate and observe the various pressure and leakage tests, including the
following:

i. "Blocked-in pressure test" or the pressure test conducted while all the WOPL's
openings are blocked or closed off; and

ii. "In-operation test" or the hourly monitoring of pressure rating after the pipeline
is filled with dyed water and pressurized at a specified rate.

c. Continue, inspect, and oversee the current gas monitoring system, or the monitoring of
gas flow from the boreholes and monitoring wells of the WOPL.

d. Check the mass or volume balance computation during WOPL test run by conducting:

i. 30 days baseline data generation

ii. Computational analysis and monitoring of the data generated.

II. After FPIC has undertaken the activities prescribed in the preceding paragraph 1, the DOE shall determine if the
activities and the results of the test run warrant the re-opening of the WOPL. In the event that the DOE is satisfied
that the WOPL is safe for continued commercial operations, it shall issue an order allowing FPIC to resume the
operations of the pipeline.

III. Once the WOPL is re-opened, the DOE shall see to it that FPIC strictly complies with the following directives:

a. Continue implementation of its Pipeline Integrity Management System (PIMS), as reviewed by the DOE,
which shall include, but shall not be limited to:

1. the conduct of daily patrols on the entire stretch of the WOPL, every two hours;

2. continued close monitoring of all the boreholes and monitoring wells of the WOPL pipeline;

3. regular periodic testing and maintenance based on its PIMS; and

4. the auditing of the pipeline's mass input versus mass output;

b. submit to the DOE, within ten (10) days of each succeeding month, monthly reports on its compliance with
the above directives and any other conditions that the DOE may impose, the results of the monitoring, tests,
and audit, as well as any and all activities undertaken on the WOPL or in connection with its operation. The
concerned government agencies, namely: the Industrial Technology Development Institute (ITDI) and the
Metals Industry Research and Development Center (MIRDC), both under the Department of Science and
Technology (DOST), the Environmental Management Bureau (EMB) of the Department of Environment and
Natural Resources (DENR), the Bureau of Design (BOD) of the Department of Public Works and Highways
(DPWH), the University of the Philippines - National Institute of Geological Science (UP-NI GS) and
University of the Philippines - Institute of Civil Engineering (UP-ICE), the petitioners, intervenors and this
Court shall likewise be furnished by FPIC with the monthly reports. This shall include, but shall not be limited
to: realignment, repairs, and maintenance works; and

c. continue coordination with the concerned government agencies for the implementation of its
projects.1âwphi1

IV. Respondent FPIC is also DIRECTED to undertake and continue the remediation, rehabilitation and restoration of
the affected Barangay Bangkal environment until full restoration of the affected area to its condition prior to the
leakage is achieved. For this purpose, respondent FPIC must strictly comply with the measures, directives and
permits issued by the DENR for its remediation activities in Barangay Bangkal, including but not limited to, the
Wastewater Discharge Permit and Permit to Operate. The DENR has the authority to oversee and supervise the
aforesaid activities on said affected barangay.

V. The Inter-Agency Committee on Environmental Health under the City Government of Makati shall SUBMIT to the
DENR its evaluation of the Remediation Plan prepared by CH2M Hill Philippines, Inc. within thirty (30) days from
receipt hereof.

VI. Petitioners' prayer for the creation of a special trust fund to answer for similar contingencies in the future is
DENIED.

SO ORDERED.

PRESBITERO J. VELASCO, JR.


Associate Justice
G.R. No. 106041 January 29, 1993

BENGUET CORPORATION, petitioner,


vs.
CENTRAL BOARD OF ASSESSMENT APPEALS, BOARD OF ASSESSMENT APPEALS OF ZAMBALES,
PROVINCIAL ASSESSOR OF ZAMBALES, PROVINCE OF ZAMBALES, and MUNICIPALITY OF SAN
MARCELINO, respondents.

Romulo, Mabanta, Buenaventura, Sayoc & De los Angeles for petitioner.

CRUZ, J.:

The realty tax assessment involved in this case amounts to P11,319,304.00. It has been imposed on the petitioner's
tailings dam and the land thereunder over its protest.

The controversy arose in 1985 when the Provincial Assessor of Zambales assessed the said properties as taxable
improvements. The assessment was appealed to the Board of Assessment Appeals of the Province of Zambales. On
August 24, 1988, the appeal was dismissed mainly on the ground of the petitioner's "failure to pay the realty taxes
that fell due during the pendency of the appeal."

The petitioner seasonably elevated the matter to the Central Board of Assessment Appeals, 1 one of the herein
respondents. In its decision dated March 22, 1990, the Board reversed the dismissal of the appeal but, on the merits,
agreed that "the tailings dam and the lands submerged thereunder (were) subject to realty tax."

For purposes of taxation the dam is considered as real property as it comes within the object
mentioned in paragraphs (a) and (b) of Article 415 of the New Civil Code. It is a construction
adhered to the soil which cannot be separated or detached without breaking the material or causing
destruction on the land upon which it is attached. The immovable nature of the dam as an
improvement determines its character as real property, hence taxable under Section 38 of the Real
Property Tax Code. (P.D. 464).

Although the dam is partly used as an anti-pollution device, this Board cannot accede to the
request for tax exemption in the absence of a law authorizing the same.

xxx xxx xxx

We find the appraisal on the land submerged as a result of the construction of the tailings dam,
covered by Tax Declaration Nos.
002-0260 and 002-0266, to be in accordance with the Schedule of Market Values for Zambales
which was reviewed and allowed for use by the Ministry (Department) of Finance in the 1981-1982
general revision. No serious attempt was made by Petitioner-Appellant Benguet Corporation to
impugn its reasonableness, i.e., that the P50.00 per square meter applied by Respondent-Appellee
Provincial Assessor is indeed excessive and unconscionable. Hence, we find no cause to disturb
the market value applied by Respondent Appellee Provincial Assessor of Zambales on the
properties of Petitioner-Appellant Benguet Corporation covered by Tax Declaration Nos. 002-0260
and 002-0266.

This petition for certiorari now seeks to reverse the above ruling.

The principal contention of the petitioner is that the tailings dam is not subject to realty tax because it is not an
"improvement" upon the land within the meaning of the Real Property Tax Code. More particularly, it is claimed —

(1) as regards the tailings dam as an "improvement":


(a) that the tailings dam has no value separate from and independent of the
mine; hence, by itself it cannot be considered an improvement separately
assessable;

(b) that it is an integral part of the mine;

(c) that at the end of the mining operation of the petitioner corporation in the
area, the tailings dam will benefit the local community by serving as an irrigation
facility;

(d) that the building of the dam has stripped the property of any commercial value
as the property is submerged under water wastes from the mine;

(e) that the tailings dam is an environmental pollution control device for which
petitioner must be commended rather than penalized with a realty tax
assessment;

(f) that the installation and utilization of the tailings dam as a pollution control
device is a requirement imposed by law;

(2) as regards the valuation of the tailings dam and the submerged lands:

(a) that the subject properties have no market value as they cannot be sold
independently of the mine;

(b) that the valuation of the tailings dam should be based on its incidental use by
petitioner as a water reservoir and not on the alleged cost of construction of the
dam and the annual build-up expense;

(c) that the "residual value formula" used by the Provincial Assessor and adopted
by respondent CBAA is arbitrary and erroneous; and

(3) as regards the petitioner's liability for penalties for


non-declaration of the tailings dam and the submerged lands for realty tax purposes:

(a) that where a tax is not paid in an honest belief that it is not due, no penalty
shall be collected in addition to the basic tax;

(b) that no other mining companies in the Philippines operating a tailings dam
have been made to declare the dam for realty tax purposes.

The petitioner does not dispute that the tailings dam may be considered realty within the meaning of Article 415. It
insists, however, that the dam cannot be subjected to realty tax as a separate and independent property because it
does not constitute an "assessable improvement" on the mine although a considerable sum may have been spent in
constructing and maintaining it.

To support its theory, the petitioner cites the following cases:

1. Municipality of Cotabato v. Santos (105 Phil. 963), where this Court considered the dikes and gates constructed by
the taxpayer in connection with a fishpond operation as integral parts of the fishpond.

2. Bislig Bay Lumber Co. v. Provincial Government of Surigao (100 Phil. 303), involving a road constructed by the
timber concessionaire in the area, where this Court did not impose a realty tax on the road primarily for two reasons:

In the first place, it cannot be disputed that the ownership of the road that was constructed by
appellee belongs to the government by right of accession not only because it is inherently
incorporated or attached to the timber land . . . but also because upon the expiration of the
concession said road would ultimately pass to the national government. . . . In the second place,
while the road was constructed by appellee primarily for its use and benefit, the privilege is not
exclusive, for . . . appellee cannot prevent the use of portions of the concession for homesteading
purposes. It is also duty bound to allow the free use of forest products within the concession for the
personal use of individuals residing in or within the vicinity of the land. . . . In other words, the
government has practically reserved the rights to use the road to promote its varied activities.
Since, as above shown, the road in question cannot be considered as an improvement which
belongs to appellee, although in part is for its benefit, it is clear that the same cannot be the subject
of assessment within the meaning of Section 2 of C.A.
No. 470.

Apparently, the realty tax was not imposed not because the road was an integral part of the lumber concession but
because the government had the right to use the road to promote its varied activities.

3. Kendrick v. Twin Lakes Reservoir Co. (144 Pacific 884), an American case, where it was declared that the
reservoir dam went with and formed part of the reservoir and that the dam would be "worthless and useless except in
connection with the outlet canal, and the water rights in the reservoir represent and include whatever utility or value
there is in the dam and headgates."

4. Ontario Silver Mining Co. v. Hixon (164 Pacific 498), also from the United States. This case involved drain tunnels
constructed by plaintiff when it expanded its mining operations downward, resulting in a constantly increasing flow of
water in the said mine. It was held that:

Whatever value they have is connected with and in fact is an integral part of the mine itself. Just as
much so as any shaft which descends into the earth or an underground incline, tunnel, or drift
would be which was used in connection with the mine.

On the other hand, the Solicitor General argues that the dam is an assessable improvement because it enhances the
value and utility of the mine. The primary function of the dam is to receive, retain and hold the water coming from the
operations of the mine, and it also enables the petitioner to impound water, which is then recycled for use in the plant.

There is also ample jurisprudence to support this view, thus:

. . . The said equipment and machinery, as appurtenances to the gas station building or shed
owned by Caltex (as to which it is subject to realty tax) and which fixtures are necessary to the
operation of the gas station, for without them the gas station would be useless and which have
been attached or affixed permanently to the gas station site or embedded therein, are taxable
improvements and machinery within the meaning of the Assessment Law and the Real Property
Tax Code. (Caltex [Phil.] Inc. v. CBAA, 114 SCRA 296).

We hold that while the two storage tanks are not embedded in the land, they may, nevertheless, be
considered as improvements on the land, enhancing its utility and rendering it useful to the oil
industry. It is undeniable that the two tanks have been installed with some degree of permanence
as receptacles for the considerable quantities of oil needed by MERALCO for its operations.
(Manila Electric Co. v. CBAA, 114 SCRA 273).

The pipeline system in question is indubitably a construction adhering to the soil. It is attached to
the land in such a way that it cannot be separated therefrom without dismantling the steel pipes
which were welded to form the pipeline. (MERALCO Securities Industrial Corp. v. CBAA, 114
SCRA 261).

The tax upon the dam was properly assessed to the plaintiff as a tax upon real estate. (Flax-Pond
Water Co. v. City of Lynn, 16 N.E. 742).

The oil tanks are structures within the statute, that they are designed and used by the owner as
permanent improvement of the free hold, and that for such reasons they were properly assessed by
the respondent taxing district as improvements. (Standard Oil Co. of New Jersey v. Atlantic City, 15
A 2d. 271)

The Real Property Tax Code does not carry a definition of "real property" and simply says that the realty tax is
imposed on "real property, such as lands, buildings, machinery and other improvements affixed or attached to real
property." In the absence of such a definition, we apply Article 415 of the Civil Code, the pertinent portions of which
state:

Art. 415. The following are immovable property.

(1) Lands, buildings and constructions of all kinds adhered to the soil;

xxx xxx xxx

(3) Everything attached to an immovable in a fixed manner, in such a way that it cannot be
separated therefrom without breaking the material or deterioration of the object.

Section 2 of C.A. No. 470, otherwise known as the Assessment Law, provides that the realty tax is due "on the real
property, including land, buildings, machinery and other improvements" not specifically exempted in Section 3
thereof. A reading of that section shows that the tailings dam of the petitioner does not fall under any of the classes of
exempt real properties therein enumerated.

Is the tailings dam an improvement on the mine? Section 3(k) of the Real Property Tax Code defines improvement as
follows:

(k) Improvements — is a valuable addition made to property or an amelioration in its condition,


amounting to more than mere repairs or replacement of waste, costing labor or capital and
intended to enhance its value, beauty or utility or to adopt it for new or further purposes.

The term has also been interpreted as "artificial alterations of the physical condition of the ground that are reasonably
permanent in character."2

The Court notes that in the Ontario case the plaintiff admitted that the mine involved therein could not be operated
without the aid of the drain tunnels, which were indispensable to the successful development and extraction of the
minerals therein. This is not true in the present case.

Even without the tailings dam, the petitioner's mining operation can still be carried out because the primary function of
the dam is merely to receive and retain the wastes and water coming from the mine. There is no allegation that the
water coming from the dam is the sole source of water for the mining operation so as to make the dam an integral
part of the mine. In fact, as a result of the construction of the dam, the petitioner can now impound and recycle water
without having to spend for the building of a water reservoir. And as the petitioner itself points out, even if the
petitioner's mine is shut down or ceases operation, the dam may still be used for irrigation of the surrounding areas,
again unlike in the Ontario case.

As correctly observed by the CBAA, the Kendrick case is also not applicable because it involved water reservoir
dams used for different purposes and for the benefit of the surrounding areas. By contrast, the tailings dam in
question is being used exclusively for the benefit of the petitioner.

Curiously, the petitioner, while vigorously arguing that the tailings dam has no separate existence, just as vigorously
contends that at the end of the mining operation the tailings dam will serve the local community as an irrigation
facility, thereby implying that it can exist independently of the mine.

From the definitions and the cases cited above, it would appear that whether a structure constitutes an improvement
so as to partake of the status of realty would depend upon the degree of permanence intended in its construction and
use. The expression "permanent" as applied to an improvement does not imply that the improvement must be used
perpetually but only until the purpose to which the principal realty is devoted has been accomplished. It is sufficient
that the improvement is intended to remain as long as the land to which it is annexed is still used for the said
purpose.

The Court is convinced that the subject dam falls within the definition of an "improvement" because it is permanent in
character and it enhances both the value and utility of petitioner's mine. Moreover, the immovable nature of the dam
defines its character as real property under Article 415 of the Civil Code and thus makes it taxable under Section 38
of the Real Property Tax Code.

The Court will also reject the contention that the appraisal at P50.00 per square meter made by the Provincial
Assessor is excessive and that his use of the "residual value formula" is arbitrary and erroneous.

Respondent Provincial Assessor explained the use of the "residual value formula" as follows:

A 50% residual value is applied in the computation because, while it is true that when slime fills the
dike, it will then be covered by another dike or stage, the stage covered is still there and still exists
and since only one face of the dike is filled, 50% or the other face is unutilized.

In sustaining this formula, the CBAA gave the following justification:

We find the appraisal on the land submerged as a result of the construction of the tailings dam,
covered by Tax Declaration Nos.
002-0260 and 002-0266, to be in accordance with the Schedule of Market Values for San
Marcelino, Zambales, which is fifty (50.00) pesos per square meter for third class industrial land
(TSN, page 17, July 5, 1989) and Schedule of Market Values for Zambales which was reviewed
and allowed for use by the Ministry (Department) of Finance in the 1981-1982 general revision. No
serious attempt was made by Petitioner-Appellant Benguet Corporation to impugn its
reasonableness, i.e, that the P50.00 per square meter applied by Respondent-Appellee Provincial
Assessor is indeed excessive and unconscionable. Hence, we find no cause to disturb the market
value applied by Respondent-Appellee Provincial Assessor of Zambales on the properties of
Petitioner-Appellant Benguet Corporation covered by Tax Declaration Nos. 002-0260 and 002-
0266.

It has been the long-standing policy of this Court to respect the conclusions of quasi-judicial agencies like the CBAA,
which, because of the nature of its functions and its frequent exercise thereof, has developed expertise in the
resolution of assessment problems. The only exception to this rule is where it is clearly shown that the administrative
body has committed grave abuse of discretion calling for the intervention of this Court in the exercise of its own
powers of review. There is no such showing in the case at bar.

We disagree, however, with the ruling of respondent CBAA that it cannot take cognizance of the issue of the propriety
of the penalties imposed upon it, which was raised by the petitioner for the first time only on appeal. The CBAA held
that this "is an entirely new matter that petitioner can take up with the Provincial Assessor (and) can be the subject of
another protest before the Local Board or a negotiation with the local sanggunian . . ., and in case of an adverse
decision by either the Local Board or the local sanggunian, (it can) elevate the same to this Board for appropriate
action."

There is no need for this time-wasting procedure. The Court may resolve the issue in this petition instead of referring
it back to the local authorities. We have studied the facts and circumstances of this case as above discussed and find
that the petitioner has acted in good faith in questioning the assessment on the tailings dam and the land submerged
thereunder. It is clear that it has not done so for the purpose of evading or delaying the payment of the questioned
tax. Hence, we hold that the petitioner is not subject to penalty for its
non-declaration of the tailings dam and the submerged lands for realty tax purposes.

WHEREFORE, the petition is DISMISSED for failure to show that the questioned decision of respondent Central
Board of Assessment Appeals is tainted with grave abuse of discretion except as to the imposition of penalties upon
the petitioner which is hereby SET ASIDE. Costs against the petitioner. It is so ordered.

Narvasa, C.J., Gutierrez, Jr., Padilla, Bidin, Griño-Aquino, Regalado, Davide, Jr., Romero, Nocon, Bellosillo, Melo
and Campos, Jr., JJ., concur Feliciano, J., took no part
G.R. No. 170599 September 22, 2010

PUBLIC HEARING COMMITTEE OF THE LAGUNA LAKE DEVELOPMENT AUTHORITY and HON. GENERAL
MANAGER CALIXTO CATAQUIZ, Petitioners,
vs.
SM PRIME HOLDINGS, INC. (in its capacity as operator of SM CITY MANILA), Respondent.

DECISION

PERALTA, J.:

Assailed in the present petition for review on certiorari are the Decision1 and Resolution2 of the Court of Appeals (CA)
dated June 28, 2004 and November 23, 2005, respectively, in CA-G.R. SP No. 79192. The CA Decision reversed
and set aside the Orders3 dated October 2, 2002, January 10, 2003 and May 27, 2003 of petitioner Public Hearing
Committee of the Laguna Lake Development Authority (LLDA), in LLDA Case No. PH-02-03-076, while the CA
Resolution denied petitioners’ Motion for Reconsideration.

The instant petition arose from an inspection conducted on February 4, 2002 by the Pollution Control Division of the
LLDA of the wastewater collected from herein respondent's SM City Manila branch. The results of the laboratory tests
showed that the sample collected from the said facility failed to conform with the effluent standards for inland water
imposed in accordance with law.4

On March 12, 2002, the LLDA informed SM City Manila of its violation, directing the same to perform corrective
measures to abate or control the pollution caused by the said company and ordering the latter to pay a penalty of
"One Thousand Pesos (₱1,000.00) per day of discharging pollutive wastewater to be computed from 4 February
2002, the date of inspection, until full cessation of discharging pollutive wastewater." 5

In a letter6 dated March 23, 2002, respondent's Pollution Control Officer requested the LLDA to conduct a re-
sampling of their effluent, claiming that they already took measures to enable their sewage treatment plant to meet
the standards set forth by the LLDA.

In an Order to Pay7 dated October 2, 2002, herein petitioner required respondent to pay a fine of Fifty Thousand
Pesos (₱50,000.00) which represents the accumulated daily penalty computed from February 4, 2002 until March 25,
2002.

In two follow-up letters dated July 2, 20028 and November 29, 2002,9 which were treated by the LLDA as a motion for
reconsideration, respondent asked for a waiver of the fine assessed by the LLDA in its March 12, 2002 Notice of
Violation and Order of October 2, 2002 on the ground that they immediately undertook corrective measures and that
the pH levels of its effluent were already controlled even prior to their request for re-sampling leading to a minimal
damage to the environment. Respondent also contended that it is a responsible operator of malls and department
stores and that it was the first time that the wastewater discharge of SM City Manila failed to meet the standards of
law with respect to inland water.

On January 10, 2003, the LLDA issued an Order10 denying respondent's request for a waiver of the fine imposed on
the latter.

On April 21, 2003, respondent submitted another letter11 to the LLDA requesting for reconsideration of its Order dated
January 10, 2003.

On May 27, 2003, the LLDA issued another Order to Pay12 denying respondent's request for reconsideration and
requiring payment of the fine within ten days from respondent's receipt of a copy of the said Order.

Aggrieved, respondent filed a petition for certiorari with the CA praying for the nullification of the Orders of the LLDA
dated October 2, 2002, January 10, 2003 and May 27, 2003.

On June 28, 2004, the CA rendered its Decision granting the petition of herein respondent and reversing and setting
aside the assailed Orders of the LLDA. Ruling that an administrative agency's power to impose fines should be
expressly granted and may not be implied, the CA found that under its charter, Republic Act No. 4850 13 (RA 4850),
the LLDA is not expressly granted any power or authority to impose fines for violations of effluent standards set by
law. Thus, the CA held that the assailed Orders of petitioner, which imposed a fine on respondent, are issued without
jurisdiction and with grave abuse of discretion.

Petitioner filed a Motion for Reconsideration, but the same was denied by the CA via its Resolution dated November
23, 2005.

Hence, the instant petition based on the following grounds:

5.1. THE COURT OF APPEALS ERRED IN FINDING THAT THE PETITION CANNOT BE DISMISSED
FOR FAILURE TO EXHAUST ADMINISTRATIVE REMEDIES, BY WAY OF EXCEPTION TO THE
GENERAL RULE.

5.2. THE COURT OF APPEALS ERRED WHEN IT TOOK COGNIZANCE OF THE PETITION OF SM
PRIME.

5.3. THE COURT OF APPEALS ERRED IN RULING THAT THE LLDA WAS NOT CONFERRED BY LAW
THE POWER TO IMPOSE FINES AND, THEREFORE, CANNOT COLLECT THE SAME FROM SM PRIME
HOLDINGS, INC.14

In their first assigned error, petitioners contend that the petition for certiorari filed by respondent with the CA is
premature. Petitioners argue that respondent did not raise purely legal questions in its petition, but also brought to the
fore factual issues which were properly within the province of the Department of Environment and Natural Resources
(DENR), which is the agency having administrative supervision over the LLDA.

In the second assignment of error, petitioners aver that a reading of the provisions of Rule 43 of the Rules of Court
would show that the CA has no jurisdiction over the petition for certiorari filed by respondent. Petitioners also assert
that respondent is already barred by estoppel from questioning the LLDA's power to impose fines, because it
(respondent) actively participated in the proceedings conducted by petitioners without challenging such power.

Lastly, petitioners aver that the LLDA has the power to impose fines and penalties based on the provisions of RA
4850 and Executive Order (E.O.) No. 927.

The Court rules for the petitioners.

As to the first assigned error, the Court agrees with petitioners that respondent did not exhaust administrative
remedies before filing a petition for certiorari with the CA.

Under the doctrine of exhaustion of administrative remedies, before a party is allowed to seek the intervention of the
court, he or she should have availed himself or herself of all the means of administrative processes afforded him or
her.15 Hence, if resort to a remedy within the administrative machinery can still be made by giving the administrative
officer concerned every opportunity to decide on a matter that comes within his or her jurisdiction, then such remedy
should be exhausted first before the court’s judicial power can be sought. 16 The premature invocation of the
intervention of the court is fatal to one’s cause of action.17 The doctrine of exhaustion of administrative remedies is
based on practical and legal reasons.18 The availment of administrative remedy entails lesser expenses and provides
for a speedier disposition of controversies. Furthermore, the courts of justice, for reasons of comity and convenience,
will shy away from a dispute until the system of administrative redress has been completed and complied with, so as
to give the administrative agency concerned every opportunity to correct its error and dispose of the case.19 While the
doctrine of exhaustion of administrative remedies is subject to several exceptions, 20 the Court finds that the instant
case does not fall under any of them.

It is true that one of the exceptions to the doctrine of exhaustion of administrative remedies is when the issues raised
are purely legal. However, the Court is not persuaded by respondent's contention that the special civil action
for certiorari it filed with the CA involved only purely legal questions and did not raise factual issues. A perusal of the
petition for certiorari filed by respondent readily shows that factual matters were raised, to wit: (a) whether respondent
has immediately implemented remedial measures to correct the pH level of the effluent discharges of SM City Manila;
and (b) whether the third party monitoring report submitted by respondent proves that it has complied with the effluent
standards for inland water set by the LLDA. Respondent insists that what has been raised in the petition filed with the
CA was whether the LLDA committed grave abuse of discretion in disregarding the evidence it presented and in
proceeding to impose a penalty despite remedial measures undertaken by the latter. Logic dictates, however, that a
determination of whether or not the LLDA indeed committed grave abuse of discretion in imposing fine on respondent
would necessarily and inevitably touch on the factual issue of whether or not respondent in fact complied with the
effluent standards set under the law. Since the matters raised by respondent involve factual issues, the questioned
Orders of the LLDA should have been brought first before the DENR which has administrative supervision of the
LLDA pursuant to E.O. No. 149.211avvphi1

Neither may respondent resort to a petition for certiorari filed directly with the CA on the ground that the Orders
issued by the LLDA are patently illegal and amount to lack or excess of jurisdiction because, as will be subsequently
discussed, the assailed Orders of the LLDA are not illegal nor were they issued in excess of jurisdiction or with grave
abuse of discretion.

Anent the second assigned error, the Court does not agree with petitioners' contention that the CA does not have
jurisdiction to entertain the petition for certiorari filed by respondent questioning the subject Orders of the LLDA.
Petitioners argue that Section 1,22 Rule 43 of the Rules of Court enumerate the quasi-judicial agencies whose
decisions or orders are directly appealable to the CA and that the LLDA is not among these agencies. Petitioners
should have noted, however, that Rule 43 refers to appeals from judgments or orders of quasi-judicial agencies in the
exercise of their quasi-judicial functions. On the other hand, Rule 65 of the Rules of Court specifically governs special
civil actions for certiorari, Section 4 of which provides that if the petition involves acts or omissions of a quasi-judicial
agency, and unless otherwise provided by law or the rules, the petition shall be filed in and cognizable only by the
CA. Thus, it is clear that jurisdiction over acts or omissions of the LLDA belong to the CA.

Nonetheless, the Court agrees with petitioners that respondent is already estopped from questioning the power of the
LLDA to impose fines as penalty owing to the fact that respondent actively participated during the hearing of its water
pollution case before the LLDA without impugning such power of the said agency. In fact, respondent even asked for
a reconsideration of the Order of the LLDA which imposed a fine upon it as evidenced by its letters dated July 2, 2002
and November 29, 2002, wherein respondent, through its pollution control officer, as well as its counsel, requested for
a waiver of the fine(s) imposed by the LLDA. By asking for a reconsideration of the fine imposed by the LLDA, the
Court arrives at no conclusion other than that respondent has impliedly admitted the authority of the latter to impose
such penalty. Hence, contrary to respondent's claim in its Comment and Memorandum, it is already barred from
assailing the LLDA's authority to impose fines.

In any case, this Court has categorically ruled in Pacific Steam Laundry, Inc. v. Laguna Lake Development
Authority,23 that the LLDA has the power to impose fines in the exercise of its function as a regulatory and quasi-
judicial body with respect to pollution cases in the Laguna Lake region. In expounding on this issue, the Court held
that the adjudication of pollution cases generally pertains to the Pollution Adjudication Board (PAB), 24 except where a
special law, such as the LLDA Charter, provides for another forum. The Court further ruled that although the PAB
assumed the powers and functions of the National Pollution Control Commission with respect to adjudication of
pollution cases, this does not preclude the LLDA from assuming jurisdiction of pollution cases within its area of
responsibility and to impose fines as penalty.

In the earlier case of The Alexandra Condominium Corporation v. Laguna Lake Development Authority,25 this Court
affirmed the ruling of the CA which sustained the LLDA's Order requiring the petitioner therein to pay a fine
representing penalty for pollutive wastewater discharge. Although the petitioner in that case did not challenge the
LLDA's authority to impose fine, the Court acknowledged the power of the LLDA to impose fines holding that under
Section 4-A of RA 4850,26 as amended, the LLDA is entitled to compensation for damages resulting from failure to
meet established water and effluent standards. Section 4-A provides, thus:

Sec. 4-A. Compensation for damages to the water and aquatic resources of Laguna de Bay and its tributaries
resulting from failure to meet established water and effluent quality standards and from such other wrongful act or
omission of a person, private or public, juridical or otherwise, punishable under the law shall be awarded to the
Authority to be earmarked for water quality control management.

In addition, Section 4(d) of E.O. No. 927, which further defines certain functions and powers of the LLDA, provides
that the LLDA has the power to "make, alter or modify orders requiring the discontinuance of pollution specifying the
conditions and the time within which such discontinuance must be accomplished." Likewise, Section 4(i) of the same
E.O. states that the LLDA is given authority to "exercise such powers and perform such other functions as may be
necessary to carry out its duties and responsibilities under this Executive Order." Also, Section 4(c) authorizes the
LLDA to "issue orders or decisions to compel compliance with the provisions of this Executive Order and its
implementing rules and regulations only after proper notice and hearing."

In Laguna Lake Development Authority v. CA,27 this Court had occasion to discuss the functions of the LLDA, thus:

x x x It must be recognized in this regard that the LLDA, as a specialized administrative agency, is specifically
mandated under Republic Act No. 4850 and its amendatory laws [PD 813 and EO 927], to carry out and make
effective the declared national policy of promoting and accelerating the development and balanced growth of the
Laguna Lake area and the surrounding Provinces of Rizal and Laguna and the cities of San Pablo, Manila, Pasay,
Quezon and Caloocan with due regard and adequate provisions for environmental management and control,
preservation of the quality of human life and ecological systems, and the prevention of undue ecological
disturbances, deterioration and pollution. Under such a broad grant of power and authority, the LLDA, by virtue of its
special charter, obviously has the responsibility to protect the inhabitants of the Laguna Lake Region from the
deleterious effects of pollutants emanating from the discharge of wastes from the surrounding areas. x x x 28

Indeed, how could the LLDA be expected to effectively perform the above-mentioned functions if, for every act or
violation committed against the law it is supposed to enforce, it is required to resort to some other authority for the
proper remedy or penalty. The intendment of the law, as gleaned from Section 4(i) of E.O. No. 927, is to clothe the
LLDA not only with the express powers granted to it, but also those which are implied or incidental but, nonetheless,
are necessary or essential for the full and proper implementation of its purposes and functions.

WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals, dated June 28, 2004, and the
Resolution dated November 23, 2005, in CA-G.R. SP No. 79192, are REVERSED and SET ASIDE. The Orders of
the Laguna Lake Development Authority, dated October 2, 2002, January 10, 2003 and May 27, 2003, are
hereby REINSTATED and AFFIRMED.

SO ORDERED.

DIOSDADO M. PERALTA
Associate Justice

WE CONCUR:
PYRO COPPER MINING CORPORATION, G.R. No. 179674

Petitioner,

- versus -

MINES ADJUDICATION BOARD-DEPARTMENT OF Present:


ENVIRONMENT AND NATURAL RESOURCES, MINES
AND GEO-SCIENCES BUREAU DIRECTOR HORACIO YNARES-SANTIAGO, J.,
C. RAMOS, REGIONAL DIRECTOR SAMUEL T. Chairperson,
PARAGAS, REGIONAL PANEL OF ARBITRATORS CHICO-NAZARIO,
ATTY. CLARO E. RAMOLETE, JR., ATTY. JOSEPH
ESTRELLA and ENGR. RENATO RIMANDO, and VELASCO, JR.,
MONTAGUE RESOURCES PHILIPPINES
NACHURA, and
CORPORATION,
PERALTA, JJ.
Respondents.

Promulgated:

July 28, 2009

x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

CHICO-NAZARIO, J.:
Before this Court is a Petition for Review on Certiorari, under Rule 45 of the 1997 Revised Rules of Civil Procedure, seeking to

reverse the Resolutions dated 23 February 2007[1] and 6 September 2007[2] of the Court of Appeals in CA-G.R. SP No. 97663. The

appellate court, in its assailed Resolution dated 23 February 2007, dismissed the Petition for Review, under Rule 43 of the 1997

Revised Rules of Civil Procedure, of herein petitioner Pyro Copper Mining Corporation, for failure of petitioner to attach pertinent

and relevant documents thereto.[3] The appellate court, in its other assailed Resolution dated 6 September 2007, denied the

Motion for Reconsideration of petitioner for lack of merit and for failure to show the authority of Atty. Vicente R. Acsay (Atty.

Acsay), one of the members of the Board of Directors of petitioner, to sign the Verification and Certification against Forum
Shopping accompanying the Petition.

Petitioner additionally prays for the setting aside or reversal of the Decision[4] dated 28 December 2006 of the Department of

Environment and Natural Resources (DENR)-Mines Adjudication Board (MAB) in MAB Case No. 0147-06, which affirmed the

Orders dated 14 September 2005[5] and 27 December 2005[6] of the DENR-Panel of Arbitrators, Region 1, San Fernando City, La

Union (Panel of Arbitrators), in Case No. 2005-00012-I, dismissing the Verified Protest/Opposition of petitioner to the Application

for Exploration Permit of private respondent Montague Resources Philippines Corporation. Ultimately, petitioner seeks the denial

of the mining claim and the revocation/cancellation of the Exploration Permit, EXPA No. 21 dated 12 September 2003, of private
respondent.

The factual antecedents of this case are as follows:

Petitioner is a corporation duly organized and existing under Philippine laws engaged in the business of mining. On 31 March

2000, petitioners Application for Mineral Production Sharing Agreement (MPSA), identified as APSA-SF-000089, with the Mines

and Geo-Sciences Bureau (MGB) of the DENR, Regional Office No. 1, San Fernando City in La Union, for the exploration,

development and commercial utilization of certain pyrite ore and other mineral deposits in a 4,360.71-hectare land in Dasol,
Pangasinan, was approved and MPSA No. 153-2000-1 was issued in its favor.

Private respondent is also a corporation organized and existing under the laws of the Philippines and engaged in the business of

mining. On 12 September 2003, private respondent filed an Application for Exploration Permit[7] with MGB covering the same

properties covered by and during the subsistence of APSA-SF-000089 and MPSA No. 153-2000-1[8] of petitioner. In turn, petitioner

filed a Verified Protest/Opposition to the Application for Exploration Permit of the private respondent. It was allegedly filed with

the Panel of Arbitrators[9] on 30 August 2005 and was received by the latter on 5 September 2005. The case was docketed as
Case No. 2005-00012-I.
Prior, however, to petitioners filing of its Verified Protest/Opposition to the private respondents Application for Exploration Permit,
petitioners MPSA No. 153-2000-1 was cancelled per DENR Memorandum Order (DMO) No. 2005-03[10] issued by the DENR
Secretary Michael Defensor on 1 February 2005. Petitioner moved for the reconsideration of DMO No. 2005-03, which the DENR
Secretary denied in its Decision[11] dated 14 June 2005.[12]

On 1 September 2005,[13] the MGB issued EP No. 05-001 to private respondent.

In an Order dated 14 September 2005, the Panel of Arbitrators dismissed motu proprio the Verified Protest/Opposition of

petitioner for the following reasons: (1) the instant pleading was filed out of time; (2) in view of the issuance of EP No. 05-001 to

private respondent, the Verified Protest/Opposition of petitioner to the Application for Exploration Permit of private respondent

was rendered moot and academic; (3) the Panel of Arbitrators had no authority/jurisdiction to cancel, deny and/or revoke EP No.

05-001 of private respondent, the same being lodged with the MGB, the issuing authority; and (4) petitioner failed to include a
certification against forum shopping.[14] Petitioner moved for its reconsideration, but the Panel of Arbitrators denied the same in
its Order dated 27 December 2005.[15]

Petitioner elevated by appeal to the MAB the Orders dated 14 September 2005 and 27 December 2005 of the Panel of
Arbitrators, docketed as MAB Case No. 0147-06.

Subsequently, in a Decision[16] dated 28 December 2006 in MAB Case No. 0147-06, the MAB dismissed the appeal of petitioner,

on the following grounds: (a) the Verified Protest/Opposition of petitioner to the Application for Exploration Permit of private

respondent was filed beyond the reglementary period; and (b) the Verified Protest/Opposition of petitioner did not include a
certification against forum shopping.[17]

Petitioner filed with the Court of Appeals a Petition for Review under Rule 43 of the 1997 Revised Rules of Civil Procedure, which
was docketed as CA-G.R. SP No. 97663.

In a Resolution dated 23 February 2007, the Court of Appeals dismissed the said Petition, pursuant to Section 7, Rule 43, of the

1997 Revised Rules of Civil Procedure,[18] for failure of petitioner to attach thereto some pertinent and relevant documents
required under Section 6 of the same Rule.[19]
Petitioner filed a Motion for Reconsideration of the 23 February 2007 Resolution, together with the required

documents. Private respondent, however, in its Comment,[20]still prayed for the dismissal of the Petition in CA-G.R. SP No. 97663
for failure of petitioner to submit Atty. Acsays authority to sign the Verification and Certification against Forum Shopping.

Petitioner was given an opportunity to submit Atty. Acsays written authority, but failed to do so. Consequently, the Court of
Appeals issued a Resolution dated 6 September 2007, denying for lack of merit the Petition in CA-G.R. SP No. 97663.

Hence, this Petition.

The petitioner raises the following issues for this Courts Resolution:

I. WHETHER OR NOT THE [COURT OF APPEALS] DEPARTED FROM THE RULES AND ESTABLISHED
JURISPRUDENCE WHEN IT DISMISSED THE PETITION [A QUO] DESPITE FAITHFUL COMPLIANCE WITH
THE RULES ON DISCLOSURE AS INCORPORATED IN THE VERIFICATION AND CERTIFICATION PORTION
OF THE MOTION FOR EXTENSION [OF] TIME AND PETITION A QUO.

II. WHETHER OR NOT THE [COURT OF APPEALS] DEPARTED FROM THE RULES AND ESTABLISHED
JURISPRUDENCE WHEN IT DISMISSED THE PETITION A QUODESPITE THE ATTACHMENT AND
SUBMISSION OF THE REQUISITE AUTHORITY TO MAKE AND SIGN VERIFICATIONS AND
SUBSEQUENTLY REQUIRED PLEADINGS.

III. WHETHER OR NOT THE [COURT OF APPEALS] REFUSED TO ADJUDICATE THE PETITION A
QUO DESPITE THE ATTENDANCE OF A CLEARLY EXCEPTIONAL CHARACTER
AND PARAMOUNT PUBLIC INTEREST INVOLVED AS WELL AS THE NECESSITY FOR A RULING TO PUT
AN END TO UNSCRUPULOUS ISSUANCE OF MINING CLAIMS.

IV. WHETHER OR NOT PUBLIC RESPONDENTS IN THE DENR COMMITTED SERIOUS ERROR AND
GRAVE ABUSE OF DISCRETION IN DECLARING THAT: (A) THE VERIFIED PROTEST/OPPOSITION WAS
FILED OUT OF TIME; (B) THE ISSUANCE OF THE EXPLORATION PERMIT IN FAVOR OF [PRIVATE
RESPONDENT] ON [1 SEPTEMBER 2005] AND THE UNILATERAL CANCELLATION OF THE MPSA BY THE
DENR-SECRETARY RENDERED THE VERIFIED PROTEST/OPPOSITION MOOT AND ACADEMIC; (C) THE
[PANEL OF ARBITRATORS] HAVE NO JURISDICTION TO CANCEL, DENY AND/OR REVOKE THE
EXPLORATION PERMIT OF [PRIVATE RESPONDENT]; AND (D) THE VERIFIED PROTEST/OPPOSITION
DOES NOT CONTAIN A CERTIFICATION AGAINST FORUM SHOPPING.[21]
To resolve the foregoing issues, the Court must address the more specific issues below:

I. Whether the subsequently attached Minutes of the Special Meeting dated 22 January 2007 of
the Board of Directors of petitioner sufficiently granted Atty. Acsay authority to sign the Verification
and Certification against Forum Shopping which accompanied the Petition in CA-G.R. SP No. 97663.

II. Whether the Verified Protest/Opposition of petitioner to the Application for Exploration Permit
of private respondent was filed out of time.

III. Whether the Verified Protest/Opposition of petitioner filed before the MAB needs to be
accompanied by a Certification against Forum Shopping.

IV. Whether the issuance by the DENR Secretary of DMO No. 2005-03 on 1 February 2005 which
cancelled MPSA No. 153-2000-1 of petitioner and the issuance by MGB of EP No. 05-001 in favor of
private respondent on 1 September 2005 rendered the Verified Protest/Opposition of petitioner
moot and academic.

V. Whether the Panel of Arbitrators has jurisdiction to cancel, deny and/or revoke EP No. 05-001
issued by MGB to private respondent.

The Court finds no merit in the present Petition.

Petitioner maintains that there are special circumstances and basic considerations in support of Atty. Acsays authority to execute

and sign the Verification and Certification against Forum Shopping which accompanied its Petition in CA-G.R. SP No. 97663. Firstly,

Atty. Acsay is an incorporator, stockholder, member of the board of directors, corporate secretary, and legal counsel of

petitioner. Secondly, he was the authorized representative of petitioner in the signing of MPSA No. 153-2000-1. Therefore, Atty.

Acsay is the best legally suitable person to make the required sworn disclosures in the Verification and Certification against Forum
Shopping in the Petition of petitioner in CA-G.R. SP No. 97663.

Petitioner also contends that the Minutes of the Meeting held on 22 January 2007 by the board of directors of petitioner,

bestowing upon Atty. Acsay the authority to make and sign the Verification for the Motion for Extension of Time to File Petition
for Review under Rule 43 of the 1997 Revised Rules of Civil Procedure, must be construed in its entirety. According to the Minutes,

Atty. Acsay was granted authority by the board to sign even verifications, which may be required in subsequent pleadings filed

by petitioner.The reference in the Minutes to the Motion for Extension of Time to File Petition for Review is not meant to be
restrictive or qualifying, as to exclude other pleadings.

With the foregoing, petitioner firmly argues that it has substantially complied with the requirements for the execution of the
Verification and Certification against Forum Shopping, which accompanied its Petition in CA-G.R. SP No. 97663.

Section 6(d), Rule 43[22] in relation to Section 2, Rule 42[23] of the 1997 Revised Rules of Civil Procedure mandates that a petition
for review shall contain a sworn certification against forum shopping, in which the petitioner shall attest that he has not

commenced any other action involving the same issues in this Court, the Court of Appeals or different divisions thereof, or any

other tribunal or agency; if there is such other action or proceeding, he must state the status of the same; and if he should

thereafter learn that a similar action or proceeding has been filed or is pending before this Court, the Court of Appeals, or different

divisions thereof, or any other tribunal or agency, he undertakes to promptly inform the aforesaid courts and other tribunal or
agency thereof within five days therefrom.[24]

For failure to comply with this mandate, Section 7, Rule 43 of the 1997 Revised Rules of Civil Procedure provides:

SEC. 7. Effect of failure to comply with requirements. The failure of the petitioner to comply with any of the
foregoing requirements regarding the payment of the docket and other lawful fees, the deposit for costs,
proof of service of the petition, and the contents of and the documents which should accompany the petition
shall be sufficient ground for the dismissal thereof.

The requirement that petitioner should sign the Certification against Forum Shopping applies even to corporations, the Rules of

Court making no distinction between natural and juridical persons.[25] A corporation, however, exercises its powers through its

board of directors and/or its duly authorized officers and agents. Physical acts, like the signing of documents, can be performed

only by natural persons duly authorized for the purpose by corporate by-laws or by a specific act of the board of directors.[26] The

signatory, therefore, in the case of the corporation should be a duly authorized director or officer of the corporation who has
knowledge of the matter being certified.[27]

If the petitioner is a corporation, a board resolution authorizing a corporate officer to execute the Certification against Forum
Shopping is necessary. A certification not signed by a duly authorized person renders the petition subject to dismissal.[28]
To recall, the Court of Appeals initially dismissed, in its Resolution dated 23 February 2007, the Petition for Review in CA-G.R. SP

No. 97663, for failure of petitioner to submit pertinent and relevant documents required under Section 6, Rule 43 of the 1997

Revised Rules of Civil Procedure. The petitioner filed a Motion for Reconsideration, attaching thereto the required documents,

except the proof of Atty. Acsays authority to sign the Verification and Certification against Forum Shopping for the

Petition. Instead of immediately dismissing the Motion for Reconsideration of petitioner, however, the Court of Appeals, in its

Resolution dated 8 June 2007, gave petitioner five days from receipt thereof to submit such proof. The petitioner then submitted

the Minutes of the Special Meeting held on 22 January 2007 by its board of directors, adopting a Resolution to the following
effect:

RESOLVED, that [Atty. Acsay], Director and Corporate Secretary of [herein petitioner] be, as he hereby is, authorized to
make and sign the verification of the pleading filed by [petitioner] entitled Motion for Extension of Time to
File Petition for Review under Rule 43 of the Rules of Court.[29]

It can be gleaned from the afore-quoted Resolution of the board of directors of petitioner that the authority granted to Atty.

Acsay was to make and sign the pleading entitled Motion for Extension of Time to File Petition for Review under Rule 43 of the

Rules of Court, but not the Petition for Review itself. The wordings of the board Resolution are so explicit that they cannot be

interpreted otherwise. There is nothing to justify the argument of petitioner that the authority to sign granted to Atty. Acsay by
the said board Resolution extended to all other pleadings subsequent to the Motion for Extension.

Other than the Minutes of the Special Meeting held on 22 January 2007 by the board of directors of petitioner, which the Court

deemed unsatisfactory, no other proof of Atty. Acsays purported authority to sign the Verification and Certification against Forum

Shopping for the Petition for Review in CA-G.R. SP No. 97663 was presented. Absent proof of such authority, then the reasonable
conclusion is that there is actually none. Given that a certification not signed by a duly authorized person renders the petition

subject to dismissal,[30] the Court of Appeals did not err in finally dismissing in its Resolution dated 6 September 2007 the Petition
of petitioner in CA-G.R. SP No. 97663.

Although the Court has previously relaxed the rules on verification and certification against forum shopping in some
instances,[31] it cannot do so here.
From the very beginning, petitioner failed to attach to its Petition for Review before the Court of Appeals the relevant documents

required by Section 6, Rule 43 of the 1997 Revised Rules of Procedure. Petitioner had two opportunities to comply with the

requisites, i.e., when it filed its Motion for Reconsideration of the 23 February 2007 Resolution of the Court of Appeals and when

it submitted its compliance with the 8 June 2007 Resolution of the appellate court; yet, petitioner still failed to do so. Petitioner
never offered any satisfactory explanation for its stubborn non-compliance with or disregard for the rules of procedure.

It is true that a litigation is not a game of technicalities, and that the rules of procedure should not be strictly enforced at the cost

of substantial justice. However, it does not mean that the Rules of Court may be ignored at will and at random, to the prejudice

of the orderly presentation and assessment of the issues and their just resolution. It must be emphasized that procedural rules

should not be belittled or dismissed simply because their non-observance may have resulted in prejudice to a partys substantial
rights. Like all rules, they are required to be followed except only for the most persuasive of reasons.[32]

II

Even assuming arguendo that Atty. Acsay did have the authority to sign the Verification and Certification against Forum Shopping

for the Petition for Review of petitioner in CA-G.R. SP No. 97663, and the Court of Appeals erred in dismissing said Petition, the

Court still cannot grant the prayer of petitioner herein to reverse the actions undertaken by the DENR as regards the cancellation
of its MPSA No. 153-2000-1 and the issuance of EP No. 05-001 to private respondent.

Petitioner insists that it filed its Verified Protest/Opposition to the Application for Exploration Permit of private respondent within

the reglementary period. Based on the records of MGB, the Notice of Application for Exploration Permit of private respondent

was actually posted from 14 July 2005 to 28 July 2005. Applying the 30-day reglementary period, the last date on which to file

any adverse claim, protest or opposition to the said application was 27 August 2005, a Saturday. Since 29 August 2005, Monday,

was declared a national holiday, the next business day was 30 August 2005, Tuesday. This very well explains why the Verified

Protest/Opposition of petitioner was filed on 30 August 2005. Petitioner further avows that it paid the required legal fees through

postal money order. The issuance of the official receipt only after the filing, through registered mail, of its Verified
Protest/Opposition, does not erase the fact that the docket fees were paid to and received by the government.

Section 21 of DAO No. 96-40 mandates:


Section 21. Publication/Posting/Radio Announcement of an Exploration Permit Application. - x x x
Any adverse claim, protest or opposition shall be filed directly, within thirty (30) calendar days from the last
date of publication/posting/radio announcement, with the concerned Regional Office or through any
concerned PENRO or CENRO for filing in the concerned Regional Office for purposes of its resolution by the
Panel of Arbitrators pursuant to the provisions of the Act and these implementing rules and regulations. x x
x.

Considering that the Rules on Pleadings, Practice and Procedure before the Panel of Arbitrators and MAB are bereft of

any provision regarding the computation of time and the manner of filing, the Court may refer to Section 1, Rule 22 and Section
3, Rule 13 of the 1997 Revised Rules of Civil Procedure,[33] which state:

Section 1. How to compute time. In computing any period of time prescribed or allowed by these
Rules, or by order of the court, or by any applicable statute, the day of the act or event from which the
designated period of time begins to run is to be excluded and the date of performance included. If the last
day of the period, as thus computed, falls on a Saturday, a Sunday, or a legal holiday in the place where the
court sits, the time shall not run until the next working day. (Emphasis supplied.)

Section 3. Manner of filing. - The filing of pleadings, appearances, motions, notices, orders, judgments and all other
papers shall be made by presenting the original copies thereof, plainly indicated as such, personally to the
clerk of court or by sending them by registered mail. In the first case, the clerk of court shall endorse on the
pleading the date and hour of filing. In the second case, the date of the mailing of motions, pleadings, or any
other papers or payments or deposits, as shown by the post office stamp on the envelope or the registry
receipt, shall be considered as the date of their filing, payment or deposit in court. The envelope shall be
attached to the record of the case. (Emphasis supplied.)

In the present case, notices of the Application for Exploration Permit of private respondent were published in

newspapers,[34] announced on the radio,[35] and posted in public places. The posting was done the latest, so we reckon the last
possible date petitioner could have validly filed its Verified Petition/Opposition with the Panel of Arbitrators therefrom.

The notices of the Application for Exploration Permit of private respondent were posted on the bulletin boards of the Office of

the Municipal Mayor of Dasol, Pangasinan on 16 to 31 March 2005; Office of the Municipal Mayor of Mabini, Pangasinan on 16

to 31 March 2005; Office of the Pangasinan Provincial Environment and Natural Resources on 17 March 2005 to 2 April 2005;

Office of the DENR Provincial Environment and Natural Resources-Pangasinan on 15 March 2005 to 6 April 2005; Office of the
DENR Community Environment and Natural Resources-Alaminos City on 17 March 2005 to 5 April 2005; Offices of the Punong
Barangays of Malimpin, San Pedro, Barlo, San Vicente, and Alilao on 16 to 31 March 2005; and MGB on 14 to 28 July 2005. [36]
Since the notice of the Application for Exploration Permit of private respondent was last posted on 28 July 2005, the

30-day reglementary period for filing any adverse claim/protest/opposition thereto ended on 27 August 2005. As petitioner

explained, however, 27 August 2005 was a Saturday; and 29 August 2005, Monday, was declared a national holiday,[37] so the

next working day was 30 August 2005, Tuesday. Petitioner did send its Verified Protest/Opposition, through registered mail,

on 30 August 2005, as evidenced by the Affidavit of Service[38] of even date and Registry Receipts No. 10181; No. 10182; No.

10183; and No. 10184.[39] Nevertheless, the Court still could not consider the Verified Protest/Opposition of petitioner as having
been filed within the reglementary period.

Section 21 of DAO No. 96-40, fixing the 30-day reglementary period for filing any adverse claim/protest/opposition to
an application for exploration permit, must be read in relation to Section 204 of DAO No. 96-40, which reads:

Section 204. Substantial Requirements for Adverse Claims, Protest and Oppositions. No adverse claim, protest or
opposition involving mining rights shall be accepted for filing unless verified and accompanied by the
prescribed docket fee and proof of services to the respondent(s), either personally or by registered mail:
Provided, That the requirement for the payment of docket fees shall not be imposed on pauper
litigants[;] (Emphasis supplied.)

and Section 7, Rule III of the Rules on Pleadings, Practice and Procedure before the Panel of Arbitrators and MAB, which states
that:

Section 7. Form and Contents of Adverse Claims, Protest or Opposition. No adverse claim, petition,
protest or opposition involving mining rights shall be accepted for filing unless verified and accompanied by
the prescribed docket fee and proof of services to the respondent(s), either personally or by registered
mail: Provided, That the requirement for the payment of docket fees shall not be imposed on pauper
litigants. (Emphasis supplied.)

Section 204 of DAO No. 96-40 and Section 7, Rule III of the Rules on Pleadings, Practice and Procedure before the Panel

of Arbitrators and MAB explicitly require that the adverse claim/protest/opposition be accompanied by the payment of the
prescribed docket fee for the same to be accepted for filing.
Upon a careful examination of the records of this case, it appears that the docket fee was paid only on 6 September

2005, as evidenced by Official Receipt (O.R.) No. 7478283 B.[40] Although petitioner avers that it paid the docket fee through

postal money order in which case, the date of mailing would be deemed the date of payment such averment is

unsubstantiated. The Court finds no evidence to prove that petitioner actually sent the purported postal money order for the

payment of the docket fee. Petitioner submits the following evidence to prove payment of the docket fee: (a) a Prudential Bank

Check in the amount of P5,020.00 dated 1 September 2005;[41] (b) O.R. No. 7478283 B dated 6 September 2005 issued by MGB

Region I, San Fernando City; and (c) several registry return receipts.[42] But these pieces of evidence do not establish at all that

the docket fee was paid by postal money order; or indicate the postal money order number and the date said postal money order

was sent. Without any evidence to prove otherwise, the Court presumes that the docket fee was paid on the date the receipt for
the same was issued, i.e., 6 September 2005.

Based on the foregoing, the Verified Protest/Opposition of petitioner to the Application for Exploration Permit of

respondent is deemed filed with the Panel of Arbitrators only upon payment of the prescribed docket fee on 6 September 2005,
clearly beyond the reglementary period, which ended on 30 August 2005.

III

The Panel of Arbitrators denied the Verified Protest/Opposition of petitioner in Case No. 2005-00012-I for another
procedural lapse, the lack of a certification against forum shopping.

Petitioner argues that a Verified Protest/Opposition does not require a certification against forum shopping. According to it,

Section 204 of DAO No. 96-40 identifies the substantial requirements of a mining adverse claim/ protest/opposition, and a

certification against forum shopping is not among them; the Panel of Arbitrators has no power and authority to impose additional

requirements for the filing and service of pleadings; the Panel of Arbitrators also does not have the authority to promulgate rules

and regulations involving the practice, pleadings, litigation and disposition of cases before it, for the same only belongs to the
MAB, pursuant to Section 207 of DAO No. 96-40.

The arguments of petitioner have no merit.

Petitioner filed a Verified Protest/Opposition before the Panel of Arbitrators to oppose the Application for Exploration Permit
filed by private respondent with the MGB. The Verified Protest/Opposition of petitioner constitutes an initiatory pleading before

the Panel of Arbitrators, for which a certification against forum shopping may be required. Truly, DAO No. 96-40 is bereft of any
provision requiring that a certification against forum shopping be attached to the adverse claim/protest/opposition. However,

Section 4, Rule 1 of the Rules on Pleading, Practice and Procedure before the Panel of Arbitrators and the MAB allows the

application of the pertinent provisions of the Rules of Court by analogy or in a suppletory manner, in the interest of expeditious
justice and whenever practical and convenient; and, according to Section 5, Rule 7 of the Revised Rules of Court:

SEC. 5. Certification against forum shopping. The plaintiff or principal party shall certify under oath
in the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed
thereto and simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed
any claim involving the same issues in any court, tribunal or quasi-judicial agency and, to the best of his
knowledge, no such other action or claim is pending therein; (b) if there is such other pending action or claim,
a complete statement of the present status thereof; and (c) if he should thereafter learn that the same or
similar action or claim has been filed or is pending, he shall report that fact within five (5) days therefrom to
the court wherein his aforesaid complaint or initiatory pleading has been filed.

Failure to comply with the foregoing requirements shall not be curable by mere amendment of the
complaint or other initiatory pleading but shall be cause for the dismissal of the casewithout prejudice, unless
otherwise provided, upon motion and after hearing. The submission of a false certification or non-compliance
with any of the undertakings therein shall constitute indirect contempt of court, without prejudice to the
corresponding administrative and criminal actions. If the acts of the party or his counsel clearly constitute
willful and deliberate forum shopping, the same shall be ground for summary dismissal with prejudice and
shall constitute direct contempt, as well as a cause for administrative sanctions.

Hence, the requirement by the Panel of Arbitrators and the MAB that a certification against forum shopping be attached

to initiatory pleadings filed before them, to ascertain that no similar actions have been filed before other courts, tribunals, or
quasi-judicial bodies, is not arbitrary or baseless. The lack of such a certification is a ground for the dismissal of the Verified
Protest/Opposition of petitioner.

IV

The Panel of Arbitrators dismissed the Verified Protest/Opposition of petitioner for a third reason: that the same has become

moot and academic, given that the DENR Secretary already issued DMO No. 2005-03 on 1 February 2005 canceling MPSA No.
153-2000-1 and MGB issued EP No. 05-001 to private respondent on 1 September 2005.
However, petitioner asserts that MPSA No. 153-2000-1 has not been finally cancelled or revoked, considering the

pendency of the legal remedies it availed itself of for DMO No. 2005-03. The issuance of DMO No. 2005-03 by the DENR Secretary,

and of EP No. 05-001 by MGB pursuant thereto, should not render the Verified Protest/Opposition of petitioner moot and
academic.

The position of petitioner is untenable.

It must be stressed that the cancellation of MPSA No. 153-2000-1 of petitioner by the DENR Secretary in DMO No. 2005-
03 is already the subject of separate proceedings.The Court cannot touch upon it in the Petition at bar.

Also worth stressing is that petitioner filed a Verified Protest/Opposition to the Application for Exploration Permit of

private respondent. When the application was approved and the exploration permit issued to private respondent, petitioner had

nothing more to protest/oppose. More importantly, with the issuance by MGB of EP No. 05-001 to private respondent, the

remedy of petitioner is to seek the cancellation thereof, over which, as subsequently discussed herein, the Panel of Arbitrators

would have no jurisdiction. The Panel of Arbitrators cannot simply consider or convert the Verified Protest/Opposition of

petitioner to the Application for Exploration Permit of private respondent as a petition for the cancellation of EP No. 05-001. Since

the Panel of Arbitrators can no longer grant petitioner any actual substantial relief by reason of the foregoing circumstances, then
the Verified Protest/Opposition of petitioner was appropriately dismissed for being moot and academic.

Finally, petitioner posits that Section 77 of Republic Act No. 7942 and Sections 202 to 203 of its Implementing Rules vest the Panel
of Arbitrators with the jurisdiction to entertain and accept any claim, protest or opposition filed directly with its office. In the

discharge thereof, the office and function bestowed upon the Panel of Arbitrators include the power and authority to deny
clearances, exclude exploration permits, and not to accept or entertain the same.

The Court disagrees.

Section 77 of Republic Act No. 7942 establishes the jurisdiction of the Panel of Arbitrators, thus:
Sec. 77. Panel of Arbitrators. x x x. Within thirty (30) working days, after the submission of the case
by the parties for decision, the panel shall have exclusive and original jurisdiction to hear and decide on the
following:

a. Disputes involving rights to mining areas;

b. Disputes involving mineral agreements or permits;

c. Disputes involving surface owners, occupants and claimholders/concessionaires; and

d. Disputes pending before the Bureau and the Department at the date of the effectivity of this
Act. (Emphasis supplied.)

In Olympic Mines and Development Corporation v. Platinum Group Metals Corporation [43] citing Celestial Nickel Mining

Exploration Corporation v. Macroasia Corporation,[44] this Court made the following pronouncements as regards paragraphs (a)
and (b) of Section 77 of Republic Act No. 7942:

In Celestial Nickel Mining Exploration Corporation v. Macroasia Corporation, et al., this Court speaking
through Justice Velasco, specified the kind of disputes that fall under Section 77(a) of the Mining Act:

The phrase disputes involving rights to mining areas refers to any adverse claim, protest,
or opposition to an application for a mineral agreement.

xxxx

[T]he power of the POA to resolve any adverse claim, opposition, or protest relative to mining rights
under Section 77 (a) of RA 7942 is confined only to adverse claims, conflicts, and
oppositions relating to applications for the grant of mineral rights. x x x. Clearly, POAs jurisdiction
over disputes involving rights to mining areas has nothing to do with the cancellation
of existing mineral agreements. (Emphases supplied.)

xxxx

Parenthetically, the permit referred to in Section 77(b) of the Mining Act pertains to exploration permit,
quarry permit, and other mining permits recognized in Chapters IV, VIII, and IX of the Mining Act. An operating
agreement, not being among those listed, cannot be considered as a mineral permit under Section 77
(b). (Emphases supplied.)

It is clear from the ruling of the Court in Olympic Mines and Celestial Nickel Mining that the Panel of Arbitrators only has

jurisdiction over adverse claims, conflicts, and oppositions relating to applications for the grant of mineral rights, but not over
cancellation of mineral rights already granted and existing.

As to who has jurisdiction to cancel an existing exploration permit, Section 28 of DAO NO. 96-40 explicitly provides:

Section 28. Cancellation of an Exploration Permit. The Director/concerned Regional Director may cancel the Exploration
Permit for failure of the Permittee to comply with any of the requirements and for violation(s) of the terms and
conditions under which the Permit is issued. For renewed Exploration Permits, the Secretary upon the
recommendation of the Director shall cause the cancellation of the same.

According to Section 5 of DAO No. 96-40, Director means the Director of the MGB Central Office, while Regional Director means

the Regional Director of any MGB Regional Office. As the authority to issue an Exploration Permit is vested in the MGB, then the

same necessarily includes the corollary power to revoke, withdraw or cancel the same. [45]Indisputably, the authority to deny,
revoke, or cancel EP No. 05-001 of private respondent is already lodged with the MGB, and not with the Panel of Arbitrators.

WHEREFORE, premises considered, the instant Petition for Review on Certiorari of petitioner Pyro Copper Mining Corporation is

hereby DENIED. The Resolutions dated 23 February 2007 and 6 September 2007 of the Court of Appeals in CA-G.R. SP No. 97663
are hereby AFFIRMED. Costs against the petitioner.

SO ORDERED.

MINITA V. CHICO-NAZARIO
Associate Justice
METROPOLITAN MANILA DEVELOPMENT AUTHORITY, G.R. Nos. 171947-48
DEPARTMENT OF ENVIRONMENT AND NATURAL
RESOURCES,DEPARTMENT OF EDUCATION, CULTURE AND
SPORTS,[1]DEPARTMENT OF HEALTH,DEPARTMENT OF Present:
AGRICULTURE,DEPARTMENT OF PUBLICWORKS AND
HIGHWAYS,DEPARTMENT OF BUDGET ANDMANAGEMENT,
PHILIPPINECOAST GUARD, PHILIPPINENATIONAL POLICE CORONA, C.J.,
MARITIMEGROUP, and DEPARTMENT OFTHE INTERIOR AND CARPIO,
LOCALGOVERNMENT, CARPIO MORALES,
Petitioners, VELASCO, JR.,
NACHURA,
- versus - LEONARDO-DE CASTRO,
BRION,
CONCERNED RESIDENTS OFMANILA BAY, represented PERALTA,
and joined by DIVINA V. ILAS, BERSAMIN,
SABINIANO ALBARRACIN, MANUEL SANTOS, JR., DINAH DEL CASTILLO,
DELA PEA, PAUL DENNIS ABAD,
QUINTERO, MA. VICTORIA VILLARAMA, JR.,
LLENOS, DONNA CALOZA, FATIMA QUITAIN, VENICE PEREZ,
SEGARRA, FRITZIE TANGKIA, MENDOZA, and
SARAH JOELLE LINTAG, SERENO, JJ.
HANNIBAL AUGUSTUS BOBIS,
FELIMON SANTIAGUEL, and
JAIME AGUSTIN R. OPOSA,
Respondents.

Promulgated:
February 15, 2011

x-----------------------------------------------------------------------------------------x

RESOLUTION
VELASCO, JR., J.:

On December 18, 2008, this Court rendered a Decision in G.R. Nos. 171947-48 ordering petitioners to clean up, rehabilitate and
preserve Manila Bay in their different capacities. The fallo reads:

WHEREFORE, the petition is DENIED. The September 28, 2005 Decision of the CA in CA-G.R. CV No. 76528 and
SP No. 74944 and the September 13, 2002 Decision of the RTC in Civil Case No. 1851-99 are AFFIRMED but
with MODIFICATIONS in view of subsequent developments or supervening events in the case. The fallo of the
RTC Decision shall now read:

WHEREFORE, judgment is hereby rendered ordering the abovenamed defendant-government


agencies to clean up, rehabilitate, and preserve Manila Bay, and restore and maintain its waters to SB level
(Class B sea waters per Water Classification Tables under DENR Administrative Order No. 34 [1990]) to make
them fit for swimming, skin-diving, and other forms of contact recreation.

In particular:

(1) Pursuant to Sec. 4 of EO 192, assigning the DENR as the primary agency responsible for the
conservation, management, development, and proper use of the countrys environment and natural
resources, and Sec. 19 of RA 9275, designating the DENR as the primary government agency responsible for
its enforcement and implementation, the DENR is directed to fully implement its Operational Plan for the
Manila Bay Coastal Strategy for the rehabilitation, restoration, and conservation of the Manila Bay at the
earliest possible time. It is ordered to call regular coordination meetings with concerned government
departments and agencies to ensure the successful implementation of the aforesaid plan of action in
accordance with its indicated completion schedules.

(2) Pursuant to Title XII (Local Government) of the Administrative Code of 1987 and Sec. 25 of the
Local Government Code of 1991, the DILG, in exercising the Presidents power of general supervision and its
duty to promulgate guidelines in establishing waste management programs under Sec. 43 of the Philippine
Environment Code (PD 1152), shall direct all LGUs in Metro Manila, Rizal, Laguna, Cavite, Bulacan, Pampanga,
and Bataan to inspect all factories, commercial establishments, and private homes along the banks of the
major river systems in their respective areas of jurisdiction, such as but not limited to the Pasig-Marikina-San
Juan Rivers, the NCR (Paraaque-Zapote, Las Pias) Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers, the
Meycauayan-Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan) River, the Imus (Cavite) River, the Laguna
De Bay, and other minor rivers and waterways that eventually discharge water into the Manila Bay; and the
lands abutting the bay, to determine whether they have wastewater treatment facilities or hygienic septic
tanks as prescribed by existing laws, ordinances, and rules and regulations. If none be found, these LGUs shall
be ordered to require non-complying establishments and homes to set up said facilities or septic tanks within
a reasonable time to prevent industrial wastes, sewage water, and human wastes from flowing into these
rivers, waterways, esteros, and the Manila Bay, under pain of closure or imposition of fines and other
sanctions.
(3) As mandated by Sec. 8 of RA 9275, the MWSS is directed to provide, install, operate, and
maintain the necessary adequate waste water treatment facilities in Metro Manila, Rizal, and Cavite where
needed at the earliest possible time.

(4) Pursuant to RA 9275, the LWUA, through the local water districts and in coordination with the
DENR, is ordered to provide, install, operate, and maintain sewerage and sanitation facilities and the efficient
and safe collection, treatment, and disposal of sewage in the provinces of Laguna, Cavite, Bulacan, Pampanga,
and Bataan where needed at the earliest possible time.

(5) Pursuant to Sec. 65 of RA 8550, the DA, through the BFAR, is ordered to improve and restore
the marine life of the Manila Bay. It is also directed to assist the LGUs in Metro Manila, Rizal, Cavite, Laguna,
Bulacan, Pampanga, and Bataan in developing, using recognized methods, the fisheries and aquatic resources
in the Manila Bay.

(6) The PCG, pursuant to Secs. 4 and 6 of PD 979, and the PNP Maritime Group, in accordance with
Sec. 124 of RA 8550, in coordination with each other, shall apprehend violators of PD 979, RA 8550, and other
existing laws and regulations designed to prevent marine pollution in the Manila Bay.

(7) Pursuant to Secs. 2 and 6-c of EO 513 and the International Convention for the Prevention of
Pollution from Ships, the PPA is ordered to immediately adopt such measures to prevent the discharge and
dumping of solid and liquid wastes and other ship-generated wastes into the Manila Bay waters from vessels
docked at ports and apprehend the violators.

(8) The MMDA, as the lead agency and implementor of programs and projects for flood control
projects and drainage services in Metro Manila, in coordination with the DPWH, DILG, affected LGUs, PNP
Maritime Group, Housing and Urban Development Coordinating Council (HUDCC), and other agencies, shall
dismantle and remove all structures, constructions, and other encroachments established or built in violation
of RA 7279, and other applicable laws along the Pasig-Marikina-San Juan Rivers, the NCR (Paraaque-Zapote,
Las Pias) Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers, and connecting waterways and esteros in
Metro Manila. The DPWH, as the principal implementor of programs and projects for flood control services
in the rest of the country more particularly in Bulacan, Bataan, Pampanga, Cavite, and Laguna, in coordination
with the DILG, affected LGUs, PNP Maritime Group, HUDCC, and other concerned government agencies, shall
remove and demolish all structures, constructions, and other encroachments built in breach of RA 7279 and
other applicable laws along the Meycauayan-Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan) River, the
Imus (Cavite) River, the Laguna De Bay, and other rivers, connecting waterways, and esteros that discharge
wastewater into the Manila Bay.

In addition, the MMDA is ordered to establish, operate, and maintain a sanitary landfill, as
prescribed by RA 9003, within a period of one (1) year from finality of this Decision. On matters within its
territorial jurisdiction and in connection with the discharge of its duties on the maintenance of sanitary
landfills and like undertakings, it is also ordered to cause the apprehension and filing of the appropriate
criminal cases against violators of the respective penal provisions of RA 9003, Sec. 27 of RA 9275 (the Clean
Water Act), and other existing laws on pollution.
(9) The DOH shall, as directed by Art. 76 of PD 1067 and Sec. 8 of RA 9275, within one (1) year from
finality of this Decision, determine if all licensed septic and sludge companies have the proper facilities for
the treatment and disposal of fecal sludge and sewage coming from septic tanks. The DOH shall give the
companies, if found to be non-complying, a reasonable time within which to set up the necessary facilities
under pain of cancellation of its environmental sanitation clearance.

(10) Pursuant to Sec. 53 of PD 1152, Sec. 118 of RA 8550, and Sec. 56 of RA 9003, the DepEd shall
integrate lessons on pollution prevention, waste management, environmental protection, and like subjects
in the school curricula of all levels to inculcate in the minds and hearts of students and, through them, their
parents and friends, the importance of their duty toward achieving and maintaining a balanced and healthful
ecosystem in the Manila Bay and the entire Philippine archipelago.

(11) The DBM shall consider incorporating an adequate budget in the General Appropriations Act
of 2010 and succeeding years to cover the expenses relating to the cleanup, restoration, and preservation of
the water quality of the Manila Bay, in line with the countrys development objective to attain economic
growth in a manner consistent with the protection, preservation, and revival of our marine waters.

(12) The heads of petitioners-agencies MMDA, DENR, DepEd, DOH, DA, DPWH, DBM, PCG, PNP
Maritime Group, DILG, and also of MWSS, LWUA, and PPA, in line with the principle of continuing mandamus,
shall, from finality of this Decision, each submit to the Court a quarterly progressive report of the activities
undertaken in accordance with this Decision.

SO ORDERED.

The government agencies did not file any motion for reconsideration and the Decision became final in January 2009.

The case is now in the execution phase of the final and executory December 18, 2008 Decision. The Manila Bay Advisory

Committee was created to receive and evaluate the quarterly progressive reports on the activities undertaken by the agencies in
accordance with said decision and to monitor the execution phase.

In the absence of specific completion periods, the Committee recommended that time frames be set for the agencies

to perform their assigned tasks. This may be viewed as an encroachment over the powers and functions of the Executive Branch
headed by the President of the Philippines.

This view is misplaced.


The issuance of subsequent resolutions by the Court is simply an exercise of judicial power under Art. VIII of the

Constitution, because the execution of the Decision is but an integral part of the adjudicative function of the Court. None of the

agencies ever questioned the power of the Court to implement the December 18, 2008 Decision nor has any of them raised the
alleged encroachment by the Court over executive functions.

While additional activities are required of the agencies like submission of plans of action, data or status reports, these

directives are but part and parcel of the execution stage of a final decision under Rule 39 of the Rules of Court. Section 47 of Rule
39 reads:

Section 47. Effect of judgments or final orders.The effect of a judgment or final order rendered by
a court of the Philippines, having jurisdiction to pronounce the judgment or final order, may be as follows:

xxxx

(c) In any other litigation between the same parties of their successors in interest, that only is
deemed to have been adjudged in a former judgment or final order which appears upon its face to have
been so adjudged, or which was actually and necessarily included therein or necessary thereto. (Emphasis
supplied.)

It is clear that the final judgment includes not only what appears upon its face to have been so adjudged but also those matters
actually and necessarily included therein or necessary thereto. Certainly, any activity that is needed to fully implement a final
judgment is necessarily encompassed by said judgment.

Moreover, the submission of periodic reports is sanctioned by Secs. 7 and 8, Rule 8 of the Rules of Procedure for
Environmental cases:

Sec. 7. Judgment.If warranted, the court shall grant the privilege of the writ of continuing
mandamus requiring respondent to perform an act or series of acts until the judgment is fully satisfied and
to grant such other reliefs as may be warranted resulting from the wrongful or illegal acts of the
respondent. The court shall require the respondent to submit periodic reports detailing the progress and
execution of the judgment, and the court may, by itself or through a commissioner or the appropriate
government agency, evaluate and monitor compliance. The petitioner may submit its comments or
observations on the execution of the judgment.
Sec. 8. Return of the writ.The periodic reports submitted by the respondent detailing compliance with the
judgment shall be contained in partial returns of the writ. Upon full satisfaction of the judgment, a final return
of the writ shall be made to the court by the respondent. If the court finds that the judgment has been fully
implemented, the satisfaction of judgment shall be entered in the court docket. (Emphasis supplied.)

With the final and executory judgment in MMDA, the writ of continuing mandamus issued in MMDA means that until petitioner-

agencies have shown full compliance with the Courts orders, the Court exercises continuing jurisdiction over them until full
execution of the judgment.

There being no encroachment over executive functions to speak of, We shall now proceed to the recommendation of the Manila
Bay Advisory Committee.

Several problems were encountered by the Manila Bay Advisory Committee.[2] An evaluation of the quarterly progressive reports

has shown that (1) there are voluminous quarterly progressive reports that are being submitted; (2) petitioner-agencies do not

have a uniform manner of reporting their cleanup, rehabilitation and preservation activities; (3) as yet no definite deadlines have

been set by petitioner DENR as to petitioner-agencies timeframe for their respective duties; (4) as of June 2010 there has been a

change in leadership in both the national and local levels; and (5) some agencies have encountered difficulties in complying with
the Courts directives.

In order to implement the afore-quoted Decision, certain directives have to be issued by the Court to address the said concerns.

Acting on the recommendation of the Manila Bay Advisory Committee, the Court hereby resolves to ORDER the
following:

(1) The Department of Environment and Natural Resources (DENR), as lead agency in the Philippine Clean Water Act of
2004, shall submit to the Court on or before June 30, 2011 the updated Operational Plan for the Manila Bay Coastal Strategy.
The DENR is ordered to submit summarized data on the overall quality of Manila Bay waters for all four quarters of
2010 on or before June 30, 2011.

The DENR is further ordered to submit the names and addresses of persons and companies in Metro Manila, Rizal,
Laguna, Cavite, Bulacan, Pampanga and Bataan that generate toxic and hazardous waste on or before September 30, 2011.

(2) On or before June 30, 2011, the Department of the Interior and Local Government (DILG) shall order the Mayors

of all cities in Metro Manila; the Governors of Rizal, Laguna, Cavite, Bulacan, Pampanga and Bataan; and the Mayors of all

the cities and towns in said provinces to inspect all factories, commercial establishments and private homes along the banks

of the major river systemssuch as but not limited to the Pasig-Marikina-San Juan Rivers, the National Capital Region

(Paranaque-Zapote, Las Pinas) Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers, the Meycauayan-Marilao-Obando

(Bulacan) Rivers, the Talisay (Bataan) River, the Imus (Cavite) River, and the Laguna De Bayand other minor rivers and

waterways within their jurisdiction that eventually discharge water into the Manila Bay and the lands abutting it, to

determine if they have wastewater treatment facilities and/or hygienic septic tanks, as prescribed by existing laws,

ordinances, rules and regulations. Said local government unit (LGU) officials are given up to September 30, 2011 to finish

the inspection of said establishments and houses.

In case of non-compliance, the LGU officials shall take appropriate action to ensure compliance by non-complying

factories, commercial establishments and private homes with said law, rules and regulations requiring the construction or
installment of wastewater treatment facilities or hygienic septic tanks.

The aforementioned governors and mayors shall submit to the DILG on or before December 31, 2011 their

respective compliance reports which will contain the names and addresses or offices of the owners of all the non-complying

factories, commercial establishments and private homes, copy furnished the concerned environmental agency, be it the

local DENR office or the Laguna Lake Development Authority.

The DILG is required to submit a five-year plan of action that will contain measures intended to ensure compliance

of all non-complying factories, commercial establishments, and private homes.


On or before June 30, 2011, the DILG and the mayors of all cities in Metro Manila shall consider providing land for

the wastewater facilities of the Metropolitan Waterworks and Sewerage System (MWSS) or its concessionaires (Maynilad

and Manila Water, Inc.) within their respective jurisdictions.

(3) The MWSS shall submit to the Court on or before June 30, 2011 the list of areas in Metro Manila, Rizal

and Cavite that do not have the necessary wastewater treatment facilities. Within the same period, the concessionaires of

the MWSS shall submit their plans and projects for the construction of wastewater treatment facilities in all the aforesaid

areas and the completion period for said facilities, which shall not go beyond 2037.

On or before June 30, 2011, the MWSS is further required to have its two concessionaires submit a report on the

amount collected as sewerage fees in their respective areas of operation as of December 31, 2010.

(4) The Local Water Utilities Administration is ordered to submit on or before September 30, 2011 its plan to provide,

install, operate and maintain sewerage and sanitation facilities in said cities and towns and the completion period for said works,
which shall be fully implemented by December 31, 2020.

(5) The Department of Agriculture (DA), through the Bureau of Fisheries and Aquatic Resources, shall submit to the

Court on or before June 30, 2011 a report on areas in Manila Bay where marine life has to be restored or improved and the

assistance it has extended to the LGUs in Metro Manila, Rizal, Cavite, Laguna, Bulacan, Pampanga and Bataan in developing the

fisheries and aquatic resources in Manila Bay. The report shall contain monitoring data on the marine life in said areas. Within

the same period, it shall submit its five-year plan to restore and improve the marine life in Manila Bay, its future activities to assist
the aforementioned LGUs for that purpose, and the completion period for said undertakings.

The DA shall submit to the Court on or before September 30, 2011 the baseline data as of September 30, 2010 on the
pollution loading into the Manila Bay system from agricultural and livestock sources.

(6) The Philippine Ports Authority (PPA) shall incorporate in its quarterly reports the list of violators it has apprehended

and the status of their cases. The PPA is further ordered to include in its report the names, make and capacity of the ships that

dock in PPA ports. The PPA shall submit to the Court on or before June 30, 2011 the measures it intends to undertake to

implement its compliance with paragraph 7 of the dispositive portion of the MMDA Decision and the completion dates of such
measures.
The PPA should include in its report the activities of its concessionaire that collects and disposes of the solid and liquid

wastes and other ship-generated wastes, which shall state the names, make and capacity of the ships serviced by it since August

2003 up to the present date, the dates the ships docked at PPA ports, the number of days the ship was at sea with the

corresponding number of passengers and crew per trip, the volume of solid, liquid and other wastes collected from said ships,
the treatment undertaken and the disposal site for said wastes.

(7) The Philippine National Police (PNP) Maritime Group shall submit on or before June 30, 2011 its five-year plan of

action on the measures and activities it intends to undertake to apprehend the violators of Republic Act No. (RA) 8550 or

the Philippine Fisheries Code of 1998 and other pertinent laws, ordinances and regulations to prevent marine pollution
in Manila Bay and to ensure the successful prosecution of violators.

The Philippine Coast Guard shall likewise submit on or before June 30, 2011 its five-year plan of action on the measures

and activities they intend to undertake to apprehend the violators of Presidential Decree No. 979 or the Marine Pollution Decree

of 1976 and RA 9993 or the Philippine Coast Guard Law of 2009 and other pertinent laws and regulations to prevent marine
pollution in Manila Bay and to ensure the successful prosecution of violators.

(8) The Metropolitan Manila Development Authority (MMDA) shall submit to the Court on or before June 30, 2011 the

names and addresses of the informal settlers in Metro Manila who, as of December 31, 2010, own and occupy houses, structures,

constructions and other encroachments established or built along the Pasig-Marikina-San Juan Rivers, the NCR (Paraaque-Zapote,

Las Pias) Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers, and connecting waterways and esteros, in violation of RA 7279

and other applicable laws. On or before June 30, 2011, the MMDA shall submit its plan for the removal of said informal settlers

and the demolition of the aforesaid houses, structures, constructions and encroachments, as well as the completion dates for
said activities, which shall be fully implemented not later than December 31, 2015.

The MMDA is ordered to submit a status report, within thirty (30) days from receipt of this Resolution, on the

establishment of a sanitary landfill facility for Metro Manila in compliance with the standards under RA 9003 or the Ecological
Solid Waste Management Act.

On or before June 30, 2011, the MMDA shall submit a report of the location of open and controlled dumps in Metro

Manila whose operations are illegal after February 21, 2006,[3] pursuant to Secs. 36 and 37 of RA 9003, and its plan for the closure
of these open and controlled dumps to be accomplished not later than December 31, 2012. Also, on or before June 30, 2011, the
DENR Secretary, as Chairperson of the National Solid Waste Management Commission (NSWMC), shall submit a report on the
location of all open and controlled dumps in Rizal, Cavite, Laguna, Bulacan, Pampanga and Bataan.

On or before June 30, 2011, the DENR Secretary, in his capacity as NSWMC Chairperson, shall submit a report on

whether or not the following landfills strictly comply with Secs. 41 and 42 of RA 9003 on the establishment and operation of
sanitary landfills, to wit:

National Capital Region

1. Navotas SLF (PhilEco), Brgy. Tanza (New Site), Navotas City

2. Payatas Controlled Dumpsite, Barangay Payatas, Quezon City

Region III

3. Sitio Coral, Brgy. Matictic, Norzagaray, Bulacan

4. Sitio Tiakad, Brgy. San Mateo, Norzagaray, Bulacan

5. Brgy. Minuyan, San Jose del Monte City, Bulacan

6. Brgy. Mapalad, Santa Rosa, Nueva Ecija

7. Sub-zone Kalangitan, Clark Capas, Tarlac Special

Economic Zone

Region IV-A

8. Kalayaan (Longos), Laguna

9. Brgy. Sto. Nino, San Pablo City, Laguna

10. Brgy. San Antonio (Pilotage SLF), San Pedro, Laguna

11. Morong, Rizal

12. Sitio Lukutan, Brgy. San Isidro, Rodriguez (Montalban), Rizal (ISWIMS)

13. Brgy. Pintong Bukawe, San Mateo, Rizal (SMSLFDC)

On or before June 30, 2011, the MMDA and the seventeen (17) LGUs in Metro Manila are ordered to jointly submit a
report on the average amount of garbage collected monthly per district in all the cities in Metro Manila from January 2009 up to
December 31, 2010 vis--vis the average amount of garbage disposed monthly in landfills and dumpsites. In its quarterly report

for the last quarter of 2010 and thereafter, MMDA shall report on the apprehensions for violations of the penal provisions of RA
9003, RA 9275 and other laws on pollution for the said period.

On or before June 30, 2011, the DPWH and the LGUs in Rizal, Laguna, Cavite, Bulacan, Pampanga, and Bataan shall

submit the names and addresses of the informal settlers in their respective areas who, as of September 30, 2010, own or occupy

houses, structures, constructions, and other encroachments built along the Meycauayan-Marilao-Obando (Bulacan) Rivers, the

Talisay (Bataan) River, the Imus (Cavite) River, the Laguna de Bay, and other rivers, connecting waterways and esteros that

discharge wastewater into the Manila Bay, in breach of RA 7279 and other applicable laws. On or before June 30, 2011, the DPWH

and the aforesaid LGUs shall jointly submit their plan for the removal of said informal settlers and the demolition of the aforesaid

structures, constructions and encroachments, as well as the completion dates for such activities which shall be implemented not
later than December 31, 2012.

(9) The Department of Health (DOH) shall submit to the Court on or before June 30, 2011 the names and addresses of

the owners of septic and sludge companies including those that do not have the proper facilities for the treatment and disposal
of fecal sludge and sewage coming from septic tanks.

The DOH shall implement rules and regulations on Environmental Sanitation Clearances and shall require companies to
procure a license to operate from the DOH.

The DOH and DENR-Environmental Management Bureau shall develop a toxic and hazardous waste management

system by June 30, 2011 which will implement segregation of hospital/toxic/hazardous wastes and prevent mixing with municipal
solid waste.

On or before June 30, 2011, the DOH shall submit a plan of action to ensure that the said companies have proper
disposal facilities and the completion dates of compliance.

(10) The Department of Education (DepEd) shall submit to the Court on or before May 31, 2011 a report on the specific

subjects on pollution prevention, waste management, environmental protection, environmental laws and the like that it has
integrated into the school curricula in all levels for the school year 2011-2012.

On or before June 30, 2011, the DepEd shall also submit its plan of action to ensure compliance of all the schools under
its supervision with respect to the integration of the aforementioned subjects in the school curricula which shall be fully
implemented by June 30, 2012.
(11) All the agencies are required to submit their quarterly reports electronically using the forms below. The agencies
may add other key performance indicators that they have identified.

SO ORDERED.

PRESBITERO J. VELASCO, JR. Associate Justice