1.

OPOSA VS FACTORAN

G.R. No. 101083 July 30, 1993

Oposa Law Office for petitioners.

The Solicitor General for respondents.

DAVIDE, JR., J.:

In a broader sense, this petition bears upon the right of Filipinos to a balanced and healthful ecology which the
petitioners dramatically associate with the twin concepts of "inter-generational responsibility" and "inter-generational
justice." Specifically, it touches on the issue of whether the said petitioners have a cause of action to "prevent the
misappropriation or impairment" of Philippine rainforests and "arrest the unabated hemorrhage of the country's vital
life support systems and continued rape of Mother Earth."

The controversy has its genesis in Civil Case No. 90-77 which was filed before Branch 66 (Makati, Metro Manila) of
the Regional Trial Court (RTC), National Capital Judicial Region. The principal plaintiffs therein, now the principal
petitioners, are all minors duly represented and joined by their respective parents. Impleaded as an additional
plaintiff is the Philippine Ecological Network, Inc. (PENI), a domestic, non-stock and non-profit corporation organized
for the purpose of, inter alia, engaging in concerted action geared for the protection of our environment and natural
resources. The original defendant was the Honorable Fulgencio S. Factoran, Jr., then Secretary of the Department
of Environment and Natural Resources (DENR). His substitution in this petition by the new Secretary, the Honorable
Angel C. Alcala, was subsequently ordered upon proper motion by the petitioners.1 The complaint2 was instituted as
a taxpayers' class suit3 and alleges that the plaintiffs "are all citizens of the Republic of the Philippines, taxpayers,
and entitled to the full benefit, use and enjoyment of the natural resource treasure that is the country's virgin tropical
forests." The same was filed for themselves and others who are equally concerned about the preservation of said
resource but are "so numerous that it is impracticable to bring them all before the Court." The minors further
asseverate that they "represent their generation as well as generations yet unborn."4 Consequently, it is prayed for
that judgment be rendered:

. . . ordering defendant, his agents, representatives and other persons acting in his behalf to
—

(1) Cancel all existing timber license agreements in the country;

(2) Cease and desist from receiving, accepting, processing, renewing or approving new
timber license agreements.

and granting the plaintiffs ". . . such other reliefs just and equitable under the premises."5

The complaint starts off with the general averments that the Philippine archipelago of 7,100 islands has a land area
of thirty million (30,000,000) hectares and is endowed with rich, lush and verdant rainforests in which varied, rare
and unique species of flora and fauna may be found; these rainforests contain a genetic, biological and chemical
pool which is irreplaceable; they are also the habitat of indigenous Philippine cultures which have existed, endured
and flourished since time immemorial; scientific evidence reveals that in order to maintain a balanced and healthful
ecology, the country's land area should be utilized on the basis of a ratio of fifty-four per cent (54%) for forest cover
and forty-six per cent (46%) for agricultural, residential, industrial, commercial and other uses; the distortion and
disturbance of this balance as a consequence of deforestation have resulted in a host of environmental tragedies,
such as (a) water shortages resulting from drying up of the water table, otherwise known as the "aquifer," as well as
of rivers, brooks and streams, (b) salinization of the water table as a result of the intrusion therein of salt water,
incontrovertible examples of which may be found in the island of Cebu and the Municipality of Bacoor, Cavite, (c)
massive erosion and the consequential loss of soil fertility and agricultural productivity, with the volume of soil
eroded estimated at one billion (1,000,000,000) cubic meters per annum — approximately the size of the entire
island of Catanduanes, (d) the endangering and extinction of the country's unique, rare and varied flora and fauna,
(e) the disturbance and dislocation of cultural communities, including the disappearance of the Filipino's indigenous
cultures, (f) the siltation of rivers and seabeds and consequential destruction of corals and other aquatic life leading
to a critical reduction in marine resource productivity, (g) recurrent spells of drought as is presently experienced by
the entire country, (h) increasing velocity of typhoon winds which result from the absence of windbreakers, (i) the
floodings of lowlands and agricultural plains arising from the absence of the absorbent mechanism of forests, (j) the
siltation and shortening of the lifespan of multi-billion peso dams constructed and operated for the purpose of
supplying water for domestic uses, irrigation and the generation of electric power, and (k) the reduction of the earth's
capacity to process carbon dioxide gases which has led to perplexing and catastrophic climatic changes such as the
phenomenon of global warming, otherwise known as the "greenhouse effect."

Plaintiffs further assert that the adverse and detrimental consequences of continued and deforestation are so
capable of unquestionable demonstration that the same may be submitted as a matter of judicial notice. This
notwithstanding, they expressed their intention to present expert witnesses as well as documentary, photographic
and film evidence in the course of the trial.

As their cause of action, they specifically allege that:

CAUSE OF ACTION

7. Plaintiffs replead by reference the foregoing allegations.

8. Twenty-five (25) years ago, the Philippines had some sixteen (16) million hectares of
rainforests constituting roughly 53% of the country's land mass.

9. Satellite images taken in 1987 reveal that there remained no more than 1.2 million
hectares of said rainforests or four per cent (4.0%) of the country's land area.

10. More recent surveys reveal that a mere 850,000 hectares of virgin old-growth rainforests
are left, barely 2.8% of the entire land mass of the Philippine archipelago and about 3.0
million hectares of immature and uneconomical secondary growth forests.

11. Public records reveal that the defendant's, predecessors have granted timber license
agreements ('TLA's') to various corporations to cut the aggregate area of 3.89 million
hectares for commercial logging purposes.

A copy of the TLA holders and the corresponding areas covered is hereto attached as Annex
"A".

12. At the present rate of deforestation, i.e. about 200,000 hectares per annum or 25
hectares per hour — nighttime, Saturdays, Sundays and holidays included — the Philippines
will be bereft of forest resources after the end of this ensuing decade, if not earlier.

13. The adverse effects, disastrous consequences, serious injury and irreparable damage of
this continued trend of deforestation to the plaintiff minor's generation and to generations yet
unborn are evident and incontrovertible. As a matter of fact, the environmental damages
enumerated in paragraph 6 hereof are already being felt, experienced and suffered by the
generation of plaintiff adults.

14. The continued allowance by defendant of TLA holders to cut and deforest the remaining
forest stands will work great damage and irreparable injury to plaintiffs — especially plaintiff
minors and their successors — who may never see, use, benefit from and enjoy this rare and
unique natural resource treasure.

This act of defendant constitutes a misappropriation and/or impairment of the natural

resource property he holds in trust for the benefit of plaintiff minors and succeeding
generations.

15. Plaintiffs have a clear and constitutional right to a balanced and healthful ecology and are
entitled to protection by the State in its capacity as the parens patriae.
 16. Plaintiff have exhausted all administrative remedies with the defendant's office. On
March 2, 1990, plaintiffs served upon defendant a final demand to cancel all logging permits
in the country.

A copy of the plaintiffs' letter dated March 1, 1990 is hereto attached as Annex "B".

17. Defendant, however, fails and refuses to cancel the existing TLA's to the continuing
serious damage and extreme prejudice of plaintiffs.

18. The continued failure and refusal by defendant to cancel the TLA's is an act violative of
the rights of plaintiffs, especially plaintiff minors who may be left with a country that is
desertified (sic), bare, barren and devoid of the wonderful flora, fauna and indigenous
cultures which the Philippines had been abundantly blessed with.

19. Defendant's refusal to cancel the aforementioned TLA's is manifestly contrary to the
public policy enunciated in the Philippine Environmental Policy which, in pertinent part, states
that it is the policy of the State —

(a) to create, develop, maintain and improve conditions under which man and nature can
thrive in productive and enjoyable harmony with each other;

(b) to fulfill the social, economic and other requirements of present and future generations of
Filipinos and;

(c) to ensure the attainment of an environmental quality that is conductive to a life of dignity
and well-being. (P.D. 1151, 6 June 1977)

20. Furthermore, defendant's continued refusal to cancel the aforementioned TLA's is

contradictory to the Constitutional policy of the State to —

a. effect "a more equitable distribution of opportunities, income and wealth" and "make full
and efficient use of natural resources (sic)." (Section 1, Article XII of the Constitution);

b. "protect the nation's marine wealth." (Section 2, ibid);

c. "conserve and promote the nation's cultural heritage and resources (sic)" (Section 14,
Article XIV, id.);

d. "protect and advance the right of the people to a balanced and healthful ecology in accord
with the rhythm and harmony of nature." (Section 16, Article II, id.)

21. Finally, defendant's act is contrary to the highest law of humankind — the natural law —
and violative of plaintiffs' right to self-preservation and perpetuation.

22. There is no other plain, speedy and adequate remedy in law other than the instant action
to arrest the unabated hemorrhage of the country's vital life support systems and continued
rape of Mother Earth. 6

On 22 June 1990, the original defendant, Secretary Factoran, Jr., filed a Motion to Dismiss the complaint based on
two (2) grounds, namely: (1) the plaintiffs have no cause of action against him and (2) the issue raised by the
plaintiffs is a political question which properly pertains to the legislative or executive branches of Government. In
their 12 July 1990 Opposition to the Motion, the petitioners maintain that (1) the complaint shows a clear and
unmistakable cause of action, (2) the motion is dilatory and (3) the action presents a justiciable question as it
involves the defendant's abuse of discretion.

On 18 July 1991, respondent Judge issued an order granting the aforementioned motion to dismiss.7 In the said
order, not only was the defendant's claim — that the complaint states no cause of action against him and that it
raises a political question — sustained, the respondent Judge further ruled that the granting of the relief prayed for
would result in the impairment of contracts which is prohibited by the fundamental law of the land.

Plaintiffs thus filed the instant special civil action for certiorari under Rule 65 of the Revised Rules of Court and ask
this Court to rescind and set aside the dismissal order on the ground that the respondent Judge gravely abused his
discretion in dismissing the action. Again, the parents of the plaintiffs-minors not only represent their children, but
have also joined the latter in this case.8

On 14 May 1992, We resolved to give due course to the petition and required the parties to submit their respective
Memoranda after the Office of the Solicitor General (OSG) filed a Comment in behalf of the respondents and the
petitioners filed a reply thereto.

Petitioners contend that the complaint clearly and unmistakably states a cause of action as it contains sufficient
allegations concerning their right to a sound environment based on Articles 19, 20 and 21 of the Civil Code (Human
Relations), Section 4 of Executive Order (E.O.) No. 192 creating the DENR, Section 3 of Presidential Decree (P.D.)
No. 1151 (Philippine Environmental Policy), Section 16, Article II of the 1987 Constitution recognizing the right of the
people to a balanced and healthful ecology, the concept of generational genocide in Criminal Law and the concept
of man's inalienable right to self-preservation and self-perpetuation embodied in natural law. Petitioners likewise rely
on the respondent's correlative obligation per Section 4 of E.O. No. 192, to safeguard the people's right to a
healthful environment.

It is further claimed that the issue of the respondent Secretary's alleged grave abuse of discretion in granting Timber
License Agreements (TLAs) to cover more areas for logging than what is available involves a judicial question.

Anent the invocation by the respondent Judge of the Constitution's non-impairment clause, petitioners maintain that
the same does not apply in this case because TLAs are not contracts. They likewise submit that even if TLAs may
be considered protected by the said clause, it is well settled that they may still be revoked by the State when the
public interest so requires.

On the other hand, the respondents aver that the petitioners failed to allege in their complaint a specific legal right
violated by the respondent Secretary for which any relief is provided by law. They see nothing in the complaint but
vague and nebulous allegations concerning an "environmental right" which supposedly entitles the petitioners to the
"protection by the state in its capacity as parens patriae." Such allegations, according to them, do not reveal a valid
cause of action. They then reiterate the theory that the question of whether logging should be permitted in the
country is a political question which should be properly addressed to the executive or legislative branches of
Government. They therefore assert that the petitioners' resources is not to file an action to court, but to lobby before
Congress for the passage of a bill that would ban logging totally.

As to the matter of the cancellation of the TLAs, respondents submit that the same cannot be done by the State
without due process of law. Once issued, a TLA remains effective for a certain period of time — usually for twenty-
five (25) years. During its effectivity, the same can neither be revised nor cancelled unless the holder has been
found, after due notice and hearing, to have violated the terms of the agreement or other forestry laws and
regulations. Petitioners' proposition to have all the TLAs indiscriminately cancelled without the requisite hearing
would be violative of the requirements of due process.

Before going any further, We must first focus on some procedural matters. Petitioners instituted Civil Case No. 90-
777 as a class suit. The original defendant and the present respondents did not take issue with this matter.
Nevertheless, We hereby rule that the said civil case is indeed a class suit. The subject matter of the complaint is of
common and general interest not just to several, but to all citizens of the Philippines. Consequently, since the parties
are so numerous, it, becomes impracticable, if not totally impossible, to bring all of them before the court. We
likewise declare that the plaintiffs therein are numerous and representative enough to ensure the full protection of all
concerned interests. Hence, all the requisites for the filing of a valid class suit under Section 12, Rule 3 of the
Revised Rules of Court are present both in the said civil case and in the instant petition, the latter being but an
incident to the former.

This case, however, has a special and novel element. Petitioners minors assert that they represent their generation
as well as generations yet unborn. We find no difficulty in ruling that they can, for themselves, for others of their
generation and for the succeeding generations, file a class suit. Their personality to sue in behalf of the succeeding
generations can only be based on the concept of intergenerational responsibility insofar as the right to a balanced
and healthful ecology is concerned. Such a right, as hereinafter expounded, considers
the "rhythm and harmony of nature." Nature means the created world in its entirety.9 Such rhythm and harmony
indispensably include, inter alia, the judicious disposition, utilization, management, renewal and conservation of the
country's forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other natural resources to the end that
their exploration, development and utilization be equitably accessible to the present as well as future generations. 10
Needless to say, every generation has a responsibility to the next to preserve that rhythm and harmony for the full
enjoyment of a balanced and healthful ecology. Put a little differently, the minors' assertion of their right to a sound
environment constitutes, at the same time, the performance of their obligation to ensure the protection of that right
for the generations to come.

The locus standi of the petitioners having thus been addressed, We shall now proceed to the merits of the petition.

After a careful perusal of the complaint in question and a meticulous consideration and evaluation of the issues
raised and arguments adduced by the parties, We do not hesitate to find for the petitioners and rule against the
respondent Judge's challenged order for having been issued with grave abuse of discretion amounting to lack of
jurisdiction. The pertinent portions of the said order reads as follows:

xxx xxx xxx

After a careful and circumspect evaluation of the Complaint, the Court cannot help but agree
with the defendant. For although we believe that plaintiffs have but the noblest of all
intentions, it (sic) fell short of alleging, with sufficient definiteness, a specific legal right they
are seeking to enforce and protect, or a specific legal wrong they are seeking to prevent and
redress (Sec. 1, Rule 2, RRC). Furthermore, the Court notes that the Complaint is replete
with vague assumptions and vague conclusions based on unverified data. In fine, plaintiffs
fail to state a cause of action in its Complaint against the herein defendant.

Furthermore, the Court firmly believes that the matter before it, being impressed with political
color and involving a matter of public policy, may not be taken cognizance of by this Court
without doing violence to the sacred principle of "Separation of Powers" of the three (3) co-
equal branches of the Government.

The Court is likewise of the impression that it cannot, no matter how we stretch our
jurisdiction, grant the reliefs prayed for by the plaintiffs, i.e., to cancel all existing timber
license agreements in the country and to cease and desist from receiving, accepting,
processing, renewing or approving new timber license agreements. For to do otherwise
would amount to "impairment of contracts" abhored (sic) by the fundamental law. 11

We do not agree with the trial court's conclusions that the plaintiffs failed to allege with sufficient definiteness a
specific legal right involved or a specific legal wrong committed, and that the complaint is replete with vague
assumptions and conclusions based on unverified data. A reading of the complaint itself belies these conclusions.

The complaint focuses on one specific fundamental legal right — the right to a balanced and healthful ecology
which, for the first time in our nation's constitutional history, is solemnly incorporated in the fundamental law. Section
16, Article II of the 1987 Constitution explicitly provides:

Sec. 16. The State shall protect and advance the right of the people to a balanced and
healthful ecology in accord with the rhythm and harmony of nature.

This right unites with the right to health which is provided for in the preceding section of the
same article:

Sec. 15. The State shall protect and promote the right to health of the people and instill
health consciousness among them.
While the right to a balanced and healthful ecology is to be found under the Declaration of Principles and State
Policies and not under the Bill of Rights, it does not follow that it is less important than any of the civil and political
rights enumerated in the latter. Such a right belongs to a different category of rights altogether for it concerns
nothing less than self-preservation and self-perpetuation — aptly and fittingly stressed by the petitioners — the
advancement of which may even be said to predate all governments and constitutions. As a matter of fact, these
basic rights need not even be written in the Constitution for they are assumed to exist from the inception of
humankind. If they are now explicitly mentioned in the fundamental charter, it is because of the well-founded fear of
its framers that unless the rights to a balanced and healthful ecology and to health are mandated as state policies by
the Constitution itself, thereby highlighting their continuing importance and imposing upon the state a solemn
obligation to preserve the first and protect and advance the second, the day would not be too far when all else would
be lost not only for the present generation, but also for those to come — generations which stand to inherit nothing
but parched earth incapable of sustaining life.

The right to a balanced and healthful ecology carries with it the correlative duty to refrain from impairing the
environment. During the debates on this right in one of the plenary sessions of the 1986 Constitutional Commission,
the following exchange transpired between Commissioner Wilfrido Villacorta and Commissioner Adolfo Azcuna who
sponsored the section in question:

MR. VILLACORTA:

Does this section mandate the State to provide sanctions against all forms of
pollution — air, water and noise pollution?

MR. AZCUNA:

Yes, Madam President. The right to healthful (sic) environment necessarily

carries with it the correlative duty of not impairing the same and, therefore,
sanctions may be provided for impairment of environmental balance. 12

The said right implies, among many other things, the judicious management and conservation of the country's
forests.

Without such forests, the ecological or environmental balance would be irreversiby disrupted.

Conformably with the enunciated right to a balanced and healthful ecology and the right to health, as well as the
other related provisions of the Constitution concerning the conservation, development and utilization of the country's
natural resources, 13 then President Corazon C. Aquino promulgated on 10 June 1987 E.O. No. 192, 14 Section 4 of
which expressly mandates that the Department of Environment and Natural Resources "shall be the primary
government agency responsible for the conservation, management, development and proper use of the country's
environment and natural resources, specifically forest and grazing lands, mineral, resources, including those in
reservation and watershed areas, and lands of the public domain, as well as the licensing and regulation of all
natural resources as may be provided for by law in order to ensure equitable sharing of the benefits derived
therefrom for the welfare of the present and future generations of Filipinos." Section 3 thereof makes the following
statement of policy:

Sec. 3. Declaration of Policy. — It is hereby declared the policy of the State to ensure the
sustainable use, development, management, renewal, and conservation of the country's
forest, mineral, land, off-shore areas and other natural resources, including the protection
and enhancement of the quality of the environment, and equitable access of the different
segments of the population to the development and the use of the country's natural
resources, not only for the present generation but for future generations as well. It is also the
policy of the state to recognize and apply a true value system including social and
environmental cost implications relative to their utilization, development and conservation of
our natural resources.

This policy declaration is substantially re-stated it Title XIV, Book IV of the Administrative Code of 1987,15 specifically
in Section 1 thereof which reads:
 Sec. 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 country's forest, mineral, land, waters,
fisheries, wildlife, off-shore areas and other natural resources, consistent with the necessity
of maintaining a sound ecological balance and protecting and enhancing the quality of the
environment and the objective of making the exploration, development and utilization of such
natural resources equitably accessible to the different segments of the present as well as
future generations.

(2) The State shall likewise recognize and apply a true value system that takes into account
social and environmental cost implications relative to the utilization, development and
conservation of our natural resources.

The above provision stresses "the necessity of maintaining a sound ecological balance and protecting and
enhancing the quality of the environment." Section 2 of the same Title, on the other hand, specifically speaks of the
mandate of the DENR; however, it makes particular reference to the fact of the agency's being subject to law and
higher authority. Said section provides:

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 State's
constitutional mandate to control and supervise the exploration, development, utilization, and
conservation of the country's natural resources.

Both E.O. NO. 192 and the Administrative Code of 1987 have set the objectives which will serve as the bases for
policy formulation, and have defined the powers and functions of the DENR.

It may, however, be recalled that even before the ratification of the 1987 Constitution, specific statutes already paid
special attention to the "environmental right" of the present and future generations. On 6 June 1977, P.D. No. 1151
(Philippine Environmental Policy) and P.D. No. 1152 (Philippine Environment Code) were issued. The former
"declared a continuing policy of the State (a) to create, develop, maintain and improve conditions under which man
and nature can thrive in productive and enjoyable harmony with each other, (b) to fulfill the social, economic and
other requirements of present and future generations of Filipinos, and (c) to insure the attainment of an
environmental quality that is conducive to a life of dignity and well-being." 16 As its goal, it speaks of the
"responsibilities of each generation as trustee and guardian of the environment for succeeding generations." 17 The
latter statute, on the other hand, gave flesh to the said policy.

Thus, the right of the petitioners (and all those they represent) to a balanced and healthful ecology is as clear as the
DENR's duty — under its mandate and by virtue of its powers and functions under E.O. No. 192 and the
Administrative Code of 1987 — to protect and advance the said right.

A denial or violation of that right by the other who has the corelative duty or obligation to respect or protect the same
gives rise to a cause of action. Petitioners maintain that the granting of the TLAs, which they claim was done with
grave abuse of discretion, violated their right to a balanced and healthful ecology; hence, the full protection thereof
requires that no further TLAs should be renewed or granted.

A cause of action is defined as:

. . . an act or omission of one party in violation of the legal right or rights of the other; and its
essential elements are legal right of the plaintiff, correlative obligation of the defendant, and
act or omission of the defendant in violation of said legal right. 18

It is settled in this jurisdiction that in a motion to dismiss based on the ground that the complaint fails to state a
cause of action, 19 the question submitted to the court for resolution involves the sufficiency of the facts alleged in the
complaint itself. No other matter should be considered; furthermore, the truth of falsity of the said allegations is
beside the point for the truth thereof is deemed hypothetically admitted. The only issue to be resolved in such a case
is: admitting such alleged facts to be true, may the court render a valid judgment in accordance with the prayer in
the complaint? 20 In Militante vs. Edrosolano, 21 this Court laid down the rule that the judiciary should "exercise the
utmost care and circumspection in passing upon a motion to dismiss on the ground of the absence thereof [cause of
action] lest, by its failure to manifest a correct appreciation of the facts alleged and deemed hypothetically admitted,
what the law grants or recognizes is effectively nullified. If that happens, there is a blot on the legal order. The law
itself stands in disrepute."

After careful examination of the petitioners' complaint, We find the statements under the introductory affirmative
allegations, as well as the specific averments under the sub-heading CAUSE OF ACTION, to be adequate enough
to show, prima facie, the claimed violation of their rights. On the basis thereof, they may thus be granted, wholly or
partly, the reliefs prayed for. It bears stressing, however, that insofar as the cancellation of the TLAs is concerned,
there is the need to implead, as party defendants, the grantees thereof for they are indispensable parties.

The foregoing considered, Civil Case No. 90-777 be said to raise a political question. Policy formulation or
determination by the executive or legislative branches of Government is not squarely put in issue. What is principally
involved is the enforcement of a right vis-a-vis policies already formulated and expressed in legislation. It must,
nonetheless, be emphasized that the political question doctrine is no longer, the insurmountable obstacle to the
exercise of judicial power or the impenetrable shield that protects executive and legislative actions from judicial
inquiry or review. The second paragraph of section 1, Article VIII of the Constitution states that:

Judicial power includes the duty of the courts of justice to settle actual controversies
involving rights which are legally demandable and enforceable, and to determine whether or
not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on
the part of any branch or instrumentality of the Government.

Commenting on this provision in his book, Philippine Political Law, 22

Mr. Justice Isagani A. Cruz, a distinguished
member of this Court, says:

The first part of the authority represents the traditional concept of judicial power, involving the
settlement of conflicting rights as conferred as law. The second part of the authority
represents a broadening of judicial power to enable the courts of justice to review what was
before forbidden territory, to wit, the discretion of the political departments of the
government.

As worded, the new provision vests in the judiciary, and particularly the Supreme Court, the
power to rule upon even the wisdom of the decisions of the executive and the legislature and
to declare their acts invalid for lack or excess of jurisdiction because tainted with grave
abuse of discretion. The catch, of course, is the meaning of "grave abuse of discretion,"
which is a very elastic phrase that can expand or contract according to the disposition of the
judiciary.

In Daza vs. Singson, 23 Mr. Justice Cruz, now speaking for this Court, noted:

In the case now before us, the jurisdictional objection becomes even less tenable and
decisive. The reason is that, even if we were to assume that the issue presented before us
was political in nature, we would still not be precluded from revolving it under the expanded
jurisdiction conferred upon us that now covers, in proper cases, even the political question.
Article VII, Section 1, of the Constitution clearly provides: . . .

The last ground invoked by the trial court in dismissing the complaint is the non-impairment of contracts clause
found in the Constitution. The court a quo declared that:

The Court is likewise of the impression that it cannot, no matter how we stretch our
jurisdiction, grant the reliefs prayed for by the plaintiffs, i.e., to cancel all existing timber
license agreements in the country and to cease and desist from receiving, accepting,
processing, renewing or approving new timber license agreements. For to do otherwise
would amount to "impairment of contracts" abhored (sic) by the fundamental law. 24
We are not persuaded at all; on the contrary, We are amazed, if not shocked, by such a sweeping pronouncement.
In the first place, the respondent Secretary did not, for obvious reasons, even invoke in his motion to dismiss the
non-impairment clause. If he had done so, he would have acted with utmost infidelity to the Government by
providing undue and unwarranted benefits and advantages to the timber license holders because he would have
forever bound the Government to strictly respect the said licenses according to their terms and conditions
regardless of changes in policy and the demands of public interest and welfare. He was aware that as correctly
pointed out by the petitioners, into every timber license must be read Section 20 of the Forestry Reform Code (P.D.
No. 705) which provides:

. . . Provided, That when the national interest so requires, the President may amend, modify,
replace or rescind any contract, concession, permit, licenses or any other form of privilege
granted herein . . .

Needless to say, all licenses may thus be revoked or rescinded by executive action. It is not a
contract, property or a property right protested by the due process clause of the Constitution. In Tan
vs. Director of Forestry, 25 this Court held:

. . . A timber license is an instrument by which the State regulates the utilization and
disposition of forest resources to the end that public welfare is promoted. A timber license is
not a contract within the purview of the due process clause; it is only a license or privilege,
which can be validly withdrawn whenever dictated by public interest or public welfare as in
this case.

A license is merely a permit or privilege to do what otherwise would be unlawful, and is not a
contract between the authority, federal, state, or municipal, granting it and the person to
whom it is granted; neither is it property or a property right, nor does it create a vested right;
nor is it taxation (37 C.J. 168). Thus, this Court held that the granting of license does not
create irrevocable rights, neither is it property or property rights (People vs. Ong Tin, 54 O.G.
7576).

We reiterated this pronouncement in Felipe Ysmael, Jr. & Co., Inc. vs. Deputy Executive Secretary: 26

. . . 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].

Since timber licenses are not contracts, the non-impairment clause, which reads:

Sec. 10. No law impairing, the obligation of contracts shall be passed. 27

cannot be invoked.

In the second place, even if it is to be assumed that the same are contracts, the instant case does not involve a law
or even an executive issuance declaring the cancellation or modification of existing timber licenses. Hence, the non-
impairment clause cannot as yet be invoked. Nevertheless, granting further that a law has actually been passed
mandating cancellations or modifications, the same cannot still be stigmatized as a violation of the non-impairment
clause. This is because by its very nature and purpose, such as law could have only been passed in the exercise of
the police power of the state for the purpose of advancing the right of the people to a balanced and healthful
ecology, promoting their health and enhancing the general welfare. In Abe vs. Foster Wheeler
Corp. 28 this Court stated:
 The freedom of contract, under our system of government, is not meant to be absolute. The
same is understood to be subject to reasonable legislative regulation aimed at the promotion
of public health, moral, safety and welfare. In other words, the constitutional guaranty of non-
impairment of obligations of contract is limited by the exercise of the police power of the
State, in the interest of public health, safety, moral and general welfare.

The reason for this is emphatically set forth in Nebia vs. New York, 29
quoted in Philippine American Life Insurance
Co. vs. Auditor General,30 to wit:

Under our form of government the use of property and the making of contracts are normally
matters of private and not of public concern. The general rule is that both shall be free of
governmental interference. But neither property rights nor contract rights are absolute; for
government cannot exist if the citizen may at will use his property to the detriment of his
fellows, or exercise his freedom of contract to work them harm. Equally fundamental with the
private right is that of the public to regulate it in the common interest.

In short, the non-impairment clause must yield to the police power of the state. 31

Finally, it is difficult to imagine, as the trial court did, how the non-impairment clause could apply with respect to the
prayer to enjoin the respondent Secretary from receiving, accepting, processing, renewing or approving new timber
licenses for, save in cases of renewal, no contract would have as of yet existed in the other instances. Moreover,
with respect to renewal, the holder is not entitled to it as a matter of right.

WHEREFORE, being impressed with merit, the instant Petition is hereby GRANTED, and the challenged Order of
respondent Judge of 18 July 1991 dismissing Civil Case No. 90-777 is hereby set aside. The petitioners may
therefore amend their complaint to implead as defendants the holders or grantees of the questioned timber license
agreements.

No pronouncement as to costs.

SO ORDERED.

2. CONCERNED CITIZENS OF MANILA BAY VS MMDA

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. Nos. 171947-48 February 15, 2011

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, DEPARTMENT OF ENVIRONMENT AND NATURAL

RESOURCES, DEPARTMENT OF EDUCATION, CULTURE AND SPORTS, 1 DEPARTMENT OF HEALTH,
DEPARTMENT OF AGRICULTURE, DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS, DEPARTMENT OF
BUDGET AND MANAGEMENT, PHILIPPINE COAST GUARD, PHILIPPINE NATIONAL POLICE MARITIME
GROUP, and DEPARTMENT OF THE INTERIOR AND LOCAL GOVERNMENT, Petitioners,
vs.
CONCERNED RESIDENTS OF MANILA BAY, represented and joined by DIVINA V. ILAS, SABINIANO
ALBARRACIN, MANUEL SANTOS, JR., DINAH DELA PEÑA, PAUL DENNIS QUINTERO, MA. VICTORIA
LLENOS, DONNA CALOZA, FATIMA QUITAIN, VENICE SEGARRA, FRITZIE TANGKIA, SARAH JOELLE
LINTAG, HANNIBAL AUGUSTUS BOBIS, FELIMON SANTIAGUEL, and JAIME AGUSTIN R. OPOSA,
Respondents.

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 country’s 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 President’s 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 (Parañaque-Zapote, Las Piñas) 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 (Parañaque-
Zapote, Las Piñas) 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 country’s 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 Court’s 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 Court’s 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 systems––such 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 Bay––and 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 (Parañaque-Zapote, Las Piñas) 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-à-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.1avv phi 1

(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.

3. CARINO VS INSULAR GOVT

U.S. Supreme Court

Cariño v. Insular Government, 212 U.S. 449 (1909)

Cariño v. Insular Government of the Philippine Islands

No. 72

Argued January 13, 1909

Decided February 23, 1909

212 U.S. 449

ERROR TO THE SUPREME COURT OF THE PHILIPPINE ISLANDS

Syllabus

Writ of error is the general, and appeal the exceptional, method of bringing Cases to this Court. The latter method is
in the main confined to equity cases, and the former is proper to bring up a judgment of the Supreme Court of the
Philippine Islands affirming a judgment of the Court of Land Registration dismissing an application for registration of
land.

Although a province may be excepted from the operation of Act No. 926 of 1903 of the Philippine Commission which
provides for the registration and perfecting of new titles, one who actually owns property in such province is entitled
to registration under Act No. 496 of 1902, which applies to the whole archipelago.
While, in legal theory and as against foreign nations, sovereignty is absolute, practically it is a question of strength
and of varying degree, and it is for a new sovereign to decide how far it will insist upon theoretical relations of the
subject to the former sovereign and how far it will recognize actual facts.

Page 212 U. S. 450

The acquisition of the Philippines was not for the purpose of acquiring the lands occupied by the inhabitants, and
under the Organic Act of July 1, 1902, c. 1369, 32 Stat. 691, providing that property rights are to be administered for
the benefit of the inhabitants, one who actually owned land for many years cannot be deprived of it for failure to
comply with certain ceremonies prescribed either by the acts of the Philippine Commission or by Spanish law.

The Organic Act of the Philippines made a bill of rights embodying safeguards of the Constitution, and, like the
Constitution, extends those safeguards to all.

Every presumption of ownership is in favor of one actually occupying land for many years, and against the
government which seeks to deprive him of it, for failure to comply with provisions of a subsequently enacted
registration act.

Title by prescription against the crown existed under Spanish law in force in the Philippine Islands prior to their
acquisition by the United States, and one occupying land in the Province of Benguet for more than fifty years before
the Treaty of Paris is entitled to the continued possession thereof.

7 Phil. 132 reversed.

The facts are stated in the opinion.

Page 212 U. S. 455

MR. JUSTICE HOLMES delivered the opinion of the Court.

This was an application to the Philippine Court of Land Registration for the registration of certain land. The
application was granted by the court on March 4, 1904. An appeal was taken to the Court of First Instance of the
Province of Benguet on behalf of the government of the Philippines, and also on behalf of the United States, those
governments having taken possession of the property for public and military purposes. The Court of First Instance
found the facts and dismissed the application upon grounds of law. This judgment was affirmed by the supreme
court, 7 Phil. 132, and the case then was brought here by writ of error.

The material facts found are very few. The applicant and plaintiff in error is an Igorot of the Province of Benguet,
where the land lies. For more than fifty years before the Treaty of

Page 212 U. S. 456

Paris, April 11, 1899, as far back as the findings go, the plaintiff and his ancestors had held the land as owners. His
grandfather had lived upon it, and had maintained fences sufficient for the holding of cattle, according to the custom
of the country, some of the fences, it seems, having been of much earlier date. His father had cultivated parts and
had used parts for pasturing cattle, and he had used it for pasture in his turn. They all had been recognized as
owners by the Igorots, and he had inherited or received the land from his father in accordance with Igorot custom.
No document of title, however, had issued from the Spanish Crown, and although, in 1893-1894 and again in 1896-
1897, he made application for one under the royal decrees then in force, nothing seems to have come of it, unless,
perhaps, information that lands in Benguet could not be conceded until those to be occupied for a sanatorium, etc.,
had been designated -- a purpose that has been carried out by the Philippine government and the United States. In
1901, the plaintiff filed a petition, alleging ownership, under the mortgage law, and the lands were registered to him,
that process, however, establishing only a possessory title, it is said.
Before we deal with the merits, we must dispose of a technical point. The government has spent some energy in
maintaining that this case should have been brought up by appeal, and not by writ of error. We are of opinion,
however, that the mode adopted was right. The proceeding for registration is likened to bills in equity to quiet title,
but it is different in principle. It is a proceeding in rem under a statute of the type of the Torrens Act, such as was
discussed in Tyler v. Court of Registration, 175 Mass. 71. It is nearer to law than to equity, and is an assertion of
legal title; but we think it unnecessary to put it into either pigeon hole. A writ of error is the general method of
bringing cases to this Court, an appeal the exception, confined to equity in the main. There is no reason for not
applying the general rule to this case. Ormsby v. Webb, 134 U. S. 47, 134 U. S. 65; Campbell v. Porter, 162 U. S.
478; Metropolitan R. Co. v. District of Columbia, 195 U. S. 322.

Page 212 U. S. 457

Another preliminary matter may as well be disposed of here. It is suggested that, even if the applicant have title, he
cannot have it registered, because the Philippine Commission's Act No. 926, of 1903, excepts the Province of
Benguet among others from its operation. But that act deals with the acquisition of new titles by homestead entries,
purchase, etc., and the perfecting of titles begun under the Spanish law. The applicant's claim is that he now owns
the land, and is entitled to registration under the Philippine Commission's Act No. 496, of 1902, which established a
court for that purpose with jurisdiction "throughout the Philippine Archipelago," § 2, and authorized in general terms
applications to be made by persons claiming to own the legal estate in fee simple, as the applicant does. He is
entitled to registration if his claim of ownership can be maintained.

We come, then, to the question on which the case was decided below -- namely, whether the plaintiff owns the land.
The position of the government, shortly stated, is that Spain assumed, asserted, and had title to all the land in the
Philippines except so far as it saw fit to permit private titles to be acquired; that there was no prescription against the
Crown, and that, if there was, a decree of June 25, 1880, required registration within a limited time to make the title
good; that the plaintiff's land was not registered, and therefore became, if it was not always, public land; that the
United States succeeded to the title of Spain, and so that the plaintiff has no rights that the Philippine government is
bound to respect.

If we suppose for the moment that the government's contention is so far correct that the Crown of Spain in form
asserted a title to this land at the date of the Treaty of Paris, to which the United States succeeded, it is not to be
assumed without argument that the plaintiff's case is at an end. It is true that Spain, in its earlier decrees, embodied
the universal feudal theory that all lands were held from the Crown, and perhaps the general attitude of conquering
nations toward people not recognized as entitled to the treatment accorded to those

Page 212 U. S. 458

in the same zone of civilization with themselves. It is true also that, in legal theory, sovereignty is absolute, and that,
as against foreign nations, the United States may assert, as Spain asserted, absolute power. But it does not follow
that, as against the inhabitants of the Philippines, the United States asserts that Spain had such power. When
theory is left on one side, sovereignty is a question of strength, and may vary in degree. How far a new sovereign
shall insist upon the theoretical relation of the subjects to the head in the past, and how far it shall recognize actual
facts, are matters for it to decide.

The Province of Benguet was inhabited by a tribe that the Solicitor General, in his argument, characterized as a
savage tribe that never was brought under the civil or military government of the Spanish Crown. It seems probable,
if not certain, that the Spanish officials would not have granted to anyone in that province the registration to which
formerly the plaintiff was entitled by the Spanish laws, and which would have made his title beyond question good.
Whatever may have been the technical position of Spain, it does not follow that, in the view of the United States, he
had lost all rights and was a mere trespasser when the present government seized his land. The argument to that
effect seems to amount to a denial of native titles throughout an important part of the island of Luzon, at least, for
the want of ceremonies which the Spaniards would not have permitted and had not the power to enforce.

The acquisition of the Philippines was not like the settlement of the white race in the United States. Whatever
consideration may have been shown to the North American Indians, the dominant purpose of the whites in America
was to occupy the land. It is obvious that, however stated, the reason for our taking over the Philippines was
different. No one, we suppose, would deny that, so far as consistent with paramount necessities, our first object in
the internal administration of the islands is to do justice to the natives, not to exploit their country for private gain. By
the Organic Act of July 1, 1902, c. 1369, § 12, 32 Stat. 691, all the property and rights acquired there by the

Page 212 U. S. 459

United States are to be administered "for the benefit of the inhabitants thereof." It is reasonable to suppose that the
attitude thus assumed by the United States with regard to what was unquestionably its own is also its attitude in
deciding what it will claim for its own. The same statute made a bill of rights, embodying the safeguards of the
Constitution, and, like the Constitution, extends those safeguards to all. It provides that

"no law shall be enacted in said islands which shall deprive any person of life, liberty, or property without due
process of law, or deny to any person therein the equal protection of the laws."

§ 5. In the light of the declaration that we have quoted from § 12, it is hard to believe that the United States was
ready to declare in the next breath that "any person" did not embrace the inhabitants of Benguet, or that it meant by
"property" only that which had become such by ceremonies of which presumably a large part of the inhabitants
never had heard, and that it proposed to treat as public land what they, by native custom and by long association --
one of the profoundest factors in human thought -- regarded as their own.

It is true that, by § 14, the government of the Philippines is empowered to enact rules and prescribe terms for
perfecting titles to public lands where some, but not all, Spanish conditions had been fulfilled, and to issue patents to
natives for not more than sixteen hectares of public lands actually occupied by the native or his ancestors before
August 13, 1898. But this section perhaps might be satisfied if confined to cases where the occupation was of land
admitted to be public land, and had not continued for such a length of time and under such circumstances as to give
rise to the understanding that the occupants were owners at that date. We hesitate to suppose that it was intended
to declare every native who had not a paper title a trespasser, and to set the claims of all the wilder tribes afloat. It is
true again that there is excepted from the provision that we have quoted as to the administration of the property and
rights acquired by the United States such land and property as shall be designated by the President for military or
other reservations,

Page 212 U. S. 460

as this land since has been. But there still remains the question what property and rights the United States asserted
itself to have acquired.

Whatever the law upon these points may be, and we mean to go no further than the necessities of decision demand,
every presumption is and ought to be against the government in a case like the present. It might, perhaps, be proper
and sufficient to say that when, as far back as testimony or memory goes, the land has been held by individuals
under a claim of private ownership, it will be presumed to have been held in the same way from before the Spanish
conquest, and never to have been public land. Certainly, in a case like this, if there is doubt or ambiguity in the
Spanish law, we ought to give the applicant the benefit of the doubt. Whether justice to the natives and the import of
the organic act ought not to carry us beyond a subtle examination of ancient texts, or perhaps even beyond the
attitude of Spanish law, humane though it was, it is unnecessary to decide. If, in a tacit way, it was assumed that the
wild tribes of the Philippines were to be dealt with as the power and inclination of the conqueror might dictate,
Congress has not yet sanctioned the same course as the proper one "for the benefit of the inhabitants thereof."

If the applicant's case is to be tried by the law of Spain, we do not discover such clear proof that it was bad by that
law as to satisfy us that he does not own the land. To begin with, the older decrees and laws cited by the counsel for
the plaintiff in error seem to indicate pretty clearly that the natives were recognized as owning some lands,
irrespective of any royal grant. In other words, Spain did not assume to convert all the native inhabitants of the
Philippines into trespassers, or even into tenants at will. For instance, Book 4, Title 12, Law 14 of the Recopilacion
de Leyes de las Indias, cited for a contrary conclusion in Valenton v. Murciano, 3 Phil. 537, while it commands
viceroys and others, when it seems proper, to call for the exhibition of grants, directs them to confirm those who hold
by good grants or justa prescripcion. It is true that it

Page 212 U. S. 461

begins by the characteristic assertion of feudal overlordship and the origin of all titles in the King or his
predecessors. That was theory and discourse. The fact was that titles were admitted to exist that owed nothing to
the powers of Spain beyond this recognition in their books.

Prescription is mentioned again in the royal cedula of October 15, 1754, cited in 3 Phil. 546:

"Where such possessors shall not be able to produce title deeds, it shall be sufficient if they shall show that ancient
possession, as a valid title by prescription."

It may be that this means possession from before 1700; but, at all events, the principle is admitted. As prescription,
even against Crown lands, was recognized by the laws of Spain, we see no sufficient reason for hesitating to admit
that it was recognized in the Philippines in regard to lands over which Spain had only a paper sovereignty.

The question comes, however, on the decree of June 25, 1880, for the adjustment of royal lands wrongfully
occupied by private individuals in the Philippine Islands. This begins with the usual theoretic assertion that, for
private ownership, there must have been a grant by competent authority; but instantly descends to fact by providing
that, for all legal effects, those who have been in possession for certain times shall be deemed owners. For
cultivated land, twenty years, uninterrupted, is enough. For uncultivated, thirty. Art. 5. So that, when this decree
went into effect, the applicant's father was owner of the land by the very terms of the decree. But, it is said, the
object of this law was to require the adjustment or registration proceedings that it described, and in that way to
require everyone to get a document of title or lose his land. That purpose may have been entertained, but it does not
appear clearly to have been applicable to all. The regulations purport to have been made "for the adjustment of
royal lands wrongfully occupied by private individuals." (We follow the translation in the government's brief.) It does
not appear that this land ever was royal land or wrongfully occupied. In Article 6, it is provided that

"interested parties not included within the two preceding

Page 212 U. S. 462

articles [the articles recognizing prescription of twenty and thirty years] may legalize their possession, and thereby
acquire the full ownership of the said lands, by means of adjustment proceedings, to be conducted in the following
manner."

This seems, by its very terms, not to apply to those declared already to be owners by lapse of time. Article 8
provides for the case of parties not asking an adjustment of the lands of which they are unlawfully enjoying the
possession, within one year, and threatens that the treasury "will reassert the ownership of the state over the lands,"
and will sell at auction such part as it does not reserve. The applicant's possession was not unlawful, and no attempt
at any such proceedings against him or his father ever was made. Finally, it should be noted that the natural
construction of the decree is confirmed by the report of the council of state. That report puts forward as a reason for
the regulations that, in view of the condition of almost all property in the Philippines, it is important to fix its status by
general rules on the principle that the lapse of a fixed period legalizes completely all possession, recommends in
two articles twenty and thirty years, as adopted in the decree, and then suggests that interested parties not included
in those articles may legalize their possession and acquire ownership by adjustment at a certain price.

It is true that the language of Articles 4 and 5 attributes title to those "who may prove" possession for the necessary
time, and we do not overlook the argument that this means may prove in registration proceedings. It may be that an
English conveyancer would have recommended an application under the foregoing decree, but certainly it was not
calculated to convey to the mind of an Igorot chief the notion that ancient family possessions were in danger, if he
had read every word of it. The words "may prove" (acrediten), as well, or better, in view of the other provisions,
might be taken to mean when called upon to do so in any litigation. There are indications that registration was
expected from all, but none sufficient to show that, for want of it, ownership actually gained would be lost.

Page 212 U. S. 463

The effect of the proof, wherever made, was not to confer title, but simply to establish it, as already conferred by the
decree, if not by earlier law. The royal decree of February 13, 1894, declaring forfeited titles that were capable of
adjustment under the decree of 1880, for which adjustment had not been sought, should not be construed as a
confiscation, but as the withdrawal of a privilege. As a matter of fact, the applicant never was disturbed. This same
decree is quoted by the Court of Land Registration for another recognition of the common law prescription of thirty
years as still running against alienable Crown land.

It will be perceived that the rights of the applicant under the Spanish law present a problem not without difficulties for
courts of a different legal tradition. We have deemed it proper on that account to notice the possible effect of the
change of sovereignty and the act of Congress establishing the fundamental principles now to be observed. Upon a
consideration of the whole case, we are of opinion that law and justice require that the applicant should be granted
what he seeks, and should not be deprived of what, by the practice and belief of those among whom he lived, was
his property, through a refined interpretation of an almost forgotten law of Spain.

Judgment reversed.

G.R. No. 2869 March 25, 1907

MATEO CARIÑO, petitioner-appellant,
vs.
THE INSULAR GOVERNMENT, respondent-appellee.
Coudert Brothers for appellant.
Office of the Solicitor-General Araneta for appellee.
ARELLANO, C.J.:
Mateo Cariño, the appellant herein, on the 23d of February, 1904, filed his petition in the Court of Land
Registration praying that there be granted to him title to a parcel of land consisting of 40 hectares, 1 are, and
13 centares, and situated in the town of Baguio, Province of Benguet, together with a house erected thereon
and constructed of wood and roofed with rimo, and bounded as follows: On the north, in lines running 1,048
metes and 20 decimeters with the lands of Sepa Cariño, H. Phelps Whitmarsh, and Calsi; on the east, in lines
running 991 meters and 50 decimeters with the land of Kuidno, Esteban Gonzales, and of the Civil
Government; on the south, in lines of 115 meters and 60 decimeters, with the lands of Talaca; and on the
west, in lines running 982 meters and 20 decimeters, with the lands of Sisco Cariño and Mayengmeng.
By order of the court the hearing of this petition, No. 561, and that of Antonio Rebollo and Vicente Valpiedad
filed under No. 834, were heard together for the reason that the latter petition claimed a small portion of land
included in the parcel set out in the former petition.
The Insular Government opposed the granting of these petitions, alleging that the whole parcel of land is
public property of the Government and that the same was never acquired in any manner or through any title
of egresion from the State.
After trial, and the hearing of documentary and oral proof, the court of Land Registration rendered its
judgment in these terms:
Therefore the court finds that Cariño and his predecessors have not possessed exclusively and adversely any
part of the said property prior to the date on which Cariño constructed the house now there — that is to say,
for the years 1897 and 1898, and Cariño held possession for some years afterwards of but a part of the
property to which he claims title. Both petitions are dismissed and the property in question is adjudged to be
public land. (Bill of exceptions, p. 15.)
The conclusions arrived at the set forth in definite terms in the decision of the court below are the following:
From the testimony given by Cariño as well as from that of several of the witnesses for the Government it is
deduced, that in or about the year 1884 Cariño erected and utilized as a domicile a house on the property
situated to the north of that property now in question, property which, according to the plan attached to
expediente No. 561, appears to be property belonging to Donaldson Sim; that during the year 1893 Cariño
sold said house to one Cristobal Ramos, who in turn sold the same to Donaldson Sim, moving to and living on
the adjoining property, which appears on the plan aforesaid to be the property of H. Phelps Whitmarsh, a
place where the father and the grandfather of his wife, that is to say, Ortega and Minse, had lived . . ..
In or about the years 1898 Cariño abandoned the property of Whitmarsh and located on the property
described in the plan attached to expediente No. 561, having constructed a house thereon in which he now
lives, and which house is situated in the center of the property, as is indicated on the plan; and since which
time he has undoubtedly occupied some portion of the property now claimed by him. (Bill of exceptions, pp.
11 and 12.)
1. Therefore it is evident that this court can not decree the registration of all of the superficial extension of the
land described in the petition and as appears on the plan filed herein, such extension containing 40 hectares, 1
are, and 13 centares, inasmuch as the documentary evidence accompanying the petition is conclusive proof
against the petitioners; this documentary proof consists of a possessory information under date of March 7,
1901, and registered on the 11th day of the same month and year; and, according to such possessory
information, the land therein described contains an extension of only 28 hectares limited by "the country road
to the barrio of Pias," a road appearing on the plan now presented and cutting the land, as might be said, in
half, or running through its center from north to south, a considerable extension of land remaining on the
other side of the said road, the west side, and which could not have been included in the possessory
information mentioned.
2. As has been shown during the trial of this case, this land, of which mention is made in said possessory
information, and upon which is situated the house now actually occupied by the petitioner, all of which is set
forth as argument as to the possession in the judgment, is "used for pasture and sowing," and belongs to the
class called public lands.
3. Under the express provisions of law, a parcel of land, being of common origin, presumptively belonged to
the State during its sovereignty, and, in order to perfect the legitimate acquisition of such land by private
persons, it was necessary that the possession of the same pass from the State. And there is no evidence or
proof of title of egresion of this land from the domain of the Spanish Government, nor is there any possessory
information equivalent to title by composicion or under agreement. 4, The possessory information filed herein
is not the title to property authorized in substitution for that of adjustment by the royal decree of February 13,
1894, this being the last law or legal disposition of the former sovereignty applicable to the present subject-
matter of common lands: First, for the reason that the land referred to herein is not covered nor does it come
within any one of the three conditions required by article 19 of the said royal decree, to wit, that the land has
been in an uninterrupted state of cultivation during a period of six years last past; or that the same has been
possessed without interruption during a period of twelve years and has been in a state of cultivation up to the
date of the information and during the three years immediately preceding such information; or that such land
had been possessed openly without interruption during a period of thirty or more years, notwithstanding the
land had not been cultivated; nor is it necessary to refer to the testimony given by the two witnesses to the
possessory information for the following reason: Second, because the possessory information authorized by
said royal decree or last legal disposition of the Spanish Government, as title or for the purpose of acquiring
actual proprietary right, equivalent to that of adjustment with the Spanish Government and required and
necessary at all times until the publication of said royal decree was limited in time to one year, in accordance
with article 21, which is as follows: " A period of one year, not to be extended, is allowed to verify the
possessory informations which are referred to in articles 19 and 20. After the expiration of this period of the
right of the cultivators and persons in possession to obtain gratuitous title thereto lapses and the land together
with full possession reverts to the state, or, as the case may be, to the community, and the said possessors
and cultivators or their assigns would simply have rights under universal or general title of average in the
event that the land is sold within a period of five years immediately following the cancellation. The possessors
not included under this chapter can only acquire by time the ownership and title to unappropriated or royal
lands in accordance with common law."
5. In accordance with the preceding provisions, the right that remained to Cariño, if it be certain that he was
the true possessor of the land in question, was the right of average in case the Government or State could
have sold the same within the period of five years immediately following for example, if the denouncement of
purchase had been carried out by Felipe Zafra or any other person, as appears from the record of the trial of
the case. Aside from this right, in such event, his possession as attested in the possessory information herein
could not, in accordance with common law, go to show any right of ownership until after the expiration of
twenty years from the expiration of twenty years from the verification and registry of the same in conformity
with the provisions of article 393 of the Mortgage Law and other conditions prescribe by this law.
6. The right of possession in accordance with common law — that is to say, civil law — remains at all times
subordinate to the Spanish administrative law, inasmuch as it could only be of force when pertaining to royal
transferable or alienable lands, which condition and the determination thereof is reversed to the government,
which classified and designated the royal alienable lands for the purpose of distinguishing them from those
lands strictly public, and from forestry lands which could at no time pass to private ownership nor be acquired
through time even after the said royal decree of February 13, 1894.
7. The advent of the new sovereignty necessarily brought a new method of dealing with lands and particularly
as to the classification and manner of transfer and acquisition of royal or common lands then appropriated,
which were thenceforth merely called public lands, the alienation of which was reserved to the Government, in
accordance with section 12 and 13 of the act of Congress of July 1, 1902,1 and in conformity with other laws
enacted under this act of Congress by the Philippine Commission prescribing rules for the execution thereof,
one of which is Act No. 648,2 herein mentioned by the petitioner, in connection with Act No. 627,3 which
appears to be the law upon which the petition herein is founded.
8. Section 6 of Act No. 627 admits prescription, in accordance with the provisions contained in Act No. 190, as
a basis for obtaining the right of ownership. "The petitioners claims title under the period of prescription of ten
years established by that act, as well as by reason of his occupancy and use thereof from time immemorial."
(Allegation 1.) But said act admits such prescription for the purpose of obtaining title and ownership to lands
"not exceeding more that sixteen hectares in extent." (Sec. 6 of said act.) The land claimed by Cariño is 40
hectares in extent, if we take into consideration his petition, or an extension of 28 hectares, according to the
possessory information, the only thing that can be considered. Therefore, it follows that the judgment denying
the petition herein and now appealed from was strictly in accordance with the law invoked herein.
9. And of the 28 hectares of land as set out in the possessory information, one part of same, according to the
testimony of Cariño, belongs to Vicente Valpiedad, the extent of which is not determined. From all of which it
follows that the precise extent has not been determined in the trial of this case on which judgment might be
based in the event that the judgment and title be declared in favor of the petitioner, Mateo Cariño. And we
should not lose sight of the fact that, considering the intention of Congress in granting ownership and title to
16 hectares, that Mateo Cariño and his children have already exceeded such amount in various acquirements
of lands, all of which is shown in different cases decided by the said Court of Land Registration, donations or
gifts of land that could only have been made efficacious as to the conveyance thereof with the assistance of
these new laws.
By reason of the findings set forth it is clearly seen that the court below did not err:
1. In finding that Mateo Cariño and those from whom he claims his right had not possessed and claimed as
owners the lands in question since time immemorial;
2. In finding that the land in question did not belong to the petitioner, but that, on the contrary, it was the
property of the Government. (Allegation 21.)
Wherefore, the judgment appealed from is affirmed with the costs of this instance against the appellant. After
the expiration of twenty days from the notification of this decision let judgment be entered in accordance
herewith, and ten days thereafter let the case be remanded to the court from whence it came for proper
action. So ordered.

4. CRUZ VS NCIP

G.R. No. 135385 December 6, 2000

ISAGANI CRUZ and CESAR EUROPA, petitioners,
vs.
SECRETARY OF ENVIRONMENT AND NATURAL RESOURCES, SECRETARY OF BUDGET AND MANAGEMENT and
CHAIRMAN and COMMISSIONERS OF THE NATIONAL COMMISSION ON INDIGENOUS PEOPLES, respondents.
HON. JUAN M .FLAVIER, HON. PONCIANO BENNAGEN, BAYANI ASCARRAGA, EDTAMI MANSAYANGAN,
BASILIO WANDAG, EVELYN DUNUAN, YAOM TUGAS, ALFREMO CARPIANO, LIBERATO A. GABIN,
MATERNIDAD M. COLAS, NARCISA M. DALUPINES, BAI KIRAM-CONNIE SATURNO, BAE MLOMO-BEATRIZ T.
ABASALA, DATU BALITUNGTUNG-ANTONIO D. LUMANDONG, DATU MANTUMUKAW TEOFISTO SABASALES,
DATU EDUAARDO BANDA, DATU JOEL UNAD, DATU RAMON BAYAAN, TIMUAY JOSE ANOY, TIMUAY MACARIO
D. SALACAO, TIMUAY EDWIN B. ENDING, DATU SAHAMPONG MALANAW VI, DATU BEN PENDAO CABIGON,
BAI NANAPNAY-LIZA SAWAY, BAY INAY DAYA-MELINDA S. REYMUNDO, BAI TINANGHAGA HELINITA T.
PANGAN, DATU MAKAPUKAW ADOLINO L. SAWAY, DATU MAUDAYAW-CRISPEN SAWAY, VICKY MAKAY,
LOURDES D. AMOS, GILBERT P. HOGGANG, TERESA GASPAR, MANUEL S. ONALAN, MIA GRACE L. GIRON,
ROSEMARIE G. PE, BENITO CARINO, JOSEPH JUDE CARANTES, LYNETTE CARANTES-VIVAL, LANGLEY
SEGUNDO, SATUR S. BUGNAY, CARLING DOMULOT, ANDRES MENDIOGRIN, LEOPOLDO ABUGAN, VIRGILIO
CAYETANO, CONCHITA G. DESCAGA, LEVY ESTEVES, ODETTE G. ESTEVEZ, RODOLFO C. AGUILAR, MAURO
VALONES, PEPE H. ATONG, OFELIA T. DAVI, PERFECTO B. GUINOSAO, WALTER N. TIMOL, MANUEL T.
SELEN, OSCAR DALUNHAY, RICO O. SULATAN, RAFFY MALINDA, ALFREDO ABILLANOS, JESSIE ANDILAB,
MIRLANDO H. MANGKULINTAS, SAMIE SATURNO, ROMEO A. LINDAHAY, ROEL S. MANSANG-CAGAN,
PAQUITO S. LIESES, FILIPE G. SAWAY, HERMINIA S. SAWAY, JULIUS S. SAWAY, LEONARDA SAWAY, JIMMY
UGYUB, SALVADOR TIONGSON, VENANCIO APANG, MADION MALID, SUKIM MALID, NENENG MALID,
MANGKATADONG AUGUSTO DIANO, JOSEPHINE M. ALBESO, MORENO MALID, MARIO MANGCAL, FELAY
DIAMILING, SALOME P. SARZA, FELIPE P. BAGON, SAMMY SALNUNGAN, ANTONIO D. EMBA, NORMA
MAPANSAGONOS, ROMEO SALIGA, SR., JERSON P. GERADA, RENATO T. BAGON, JR., SARING MASALONG,
SOLEDAD M. GERARDA, ELIZABETH L. MENDI, MORANTE S. TIWAN, DANILO M. MALUDAO, MINORS
MARICEL MALID, represented by her father CORNELIO MALID, MARCELINO M. LADRA, represented by her
father MONICO D. LADRA, JENNYLYN MALID, represented by her father TONY MALID, ARIEL M.
EVANGELISTA, represented by her mother LINAY BALBUENA, EDWARD M. EMUY, SR., SUSAN BOLANIO, OND,
PULA BATO B'LAAN TRIBAL FARMER'S ASSOCIATION, INTER-PEOPLE'S EXCHANGE, INC. and GREEN FORUM-
WESTERN VISAYAS, intervenors.
COMMISSION ON HUMAN RIGHTS, intervenor.
IKALAHAN INDIGENOUS PEOPLE and HARIBON FOUNDATION FOR THE CONSERVATION OF NATURAL
RESOURCES, INC., intervenor.
RESOLUTION
PER CURIAM:
Petitioners Isagani Cruz and Cesar Europa brought this suit for prohibition and mandamus as citizens and
taxpayers, assailing the constitutionality of certain provisions of Republic Act No. 8371 (R.A. 8371), otherwise
known as the Indigenous Peoples Rights Act of 1997 (IPRA), and its Implementing Rules and Regulations
(Implementing Rules).
In its resolution of September 29, 1998, the Court required respondents to comment.1 In compliance,
respondents Chairperson and Commissioners of the National Commission on Indigenous Peoples (NCIP), the
government agency created under the IPRA to implement its provisions, filed on October 13, 1998 their
Comment to the Petition, in which they defend the constitutionality of the IPRA and pray that the petition be
dismissed for lack of merit.
On October 19, 1998, respondents Secretary of the Department of Environment and Natural Resources
(DENR) and Secretary of the Department of Budget and Management (DBM) filed through the Solicitor General
a consolidated Comment. The Solicitor General is of the view that the IPRA is partly unconstitutional on the
ground that it grants ownership over natural resources to indigenous peoples and prays that the petition be
granted in part.
On November 10, 1998, a group of intervenors, composed of Sen. Juan Flavier, one of the authors of the
IPRA, Mr. Ponciano Bennagen, a member of the 1986 Constitutional Commission, and the leaders and
members of 112 groups of indigenous peoples (Flavier, et. al), filed their Motion for Leave to Intervene. They
join the NCIP in defending the constitutionality of IPRA and praying for the dismissal of the petition.
On March 22, 1999, the Commission on Human Rights (CHR) likewise filed a Motion to Intervene and/or to
Appear as Amicus Curiae. The CHR asserts that IPRA is an expression of the principle of parens patriae and
that the State has the responsibility to protect and guarantee the rights of those who are at a serious
disadvantage like indigenous peoples. For this reason it prays that the petition be dismissed.
On March 23, 1999, another group, composed of the Ikalahan Indigenous People and the Haribon Foundation
for the Conservation of Natural Resources, Inc. (Haribon, et al.), filed a motion to Intervene with attached
Comment-in-Intervention. They agree with the NCIP and Flavier, et al. that IPRA is consistent with the
Constitution and pray that the petition for prohibition and mandamus be dismissed.
The motions for intervention of the aforesaid groups and organizations were granted.
Oral arguments were heard on April 13, 1999. Thereafter, the parties and intervenors filed their respective
memoranda in which they reiterate the arguments adduced in their earlier pleadings and during the hearing.
Petitioners assail the constitutionality of the following provisions of the IPRA and its Implementing Rules on
the ground that they amount to an unlawful deprivation of the State’s ownership over lands of the public
domain as well as minerals and other natural resources therein, in violation of the regalian doctrine embodied
in Section 2, Article XII of the Constitution:
"(1) Section 3(a) which defines the extent and coverage of ancestral domains, and Section 3(b) which, in turn,
defines ancestral lands;
"(2) Section 5, in relation to section 3(a), which provides that ancestral domains including inalienable public
lands, bodies of water, mineral and other resources found within ancestral domains are private but community
property of the indigenous peoples;
"(3) Section 6 in relation to section 3(a) and 3(b) which defines the composition of ancestral domains and
ancestral lands;
"(4) Section 7 which recognizes and enumerates the rights of the indigenous peoples over the ancestral
domains;
(5) Section 8 which recognizes and enumerates the rights of the indigenous peoples over the ancestral lands;
"(6) Section 57 which provides for priority rights of the indigenous peoples in the harvesting, extraction,
development or exploration of minerals and other natural resources within the areas claimed to be their
ancestral domains, and the right to enter into agreements with nonindigenous peoples for the development
and utilization of natural resources therein for a period not exceeding 25 years, renewable for not more than
25 years; and
"(7) Section 58 which gives the indigenous peoples the responsibility to maintain, develop, protect and
conserve the ancestral domains and portions thereof which are found to be necessary for critical watersheds,
mangroves, wildlife sanctuaries, wilderness, protected areas, forest cover or reforestation."2
Petitioners also content that, by providing for an all-encompassing definition of "ancestral domains" and
"ancestral lands" which might even include private lands found within said areas, Sections 3(a) and 3(b)
violate the rights of private landowners.3
In addition, petitioners question the provisions of the IPRA defining the powers and jurisdiction of the NCIP
and making customary law applicable to the settlement of disputes involving ancestral domains and ancestral
lands on the ground that these provisions violate the due process clause of the Constitution.4
These provisions are:
"(1) sections 51 to 53 and 59 which detail the process of delineation and recognition of ancestral domains and
which vest on the NCIP the sole authority to delineate ancestral domains and ancestral lands;
"(2) Section 52[i] which provides that upon certification by the NCIP that a particular area is an ancestral
domain and upon notification to the following officials, namely, the Secretary of Environment and Natural
Resources, Secretary of Interior and Local Governments, Secretary of Justice and Commissioner of the
National Development Corporation, the jurisdiction of said officials over said area terminates;
"(3) Section 63 which provides the customary law, traditions and practices of indigenous peoples shall be
applied first with respect to property rights, claims of ownership, hereditary succession and settlement of land
disputes, and that any doubt or ambiguity in the interpretation thereof shall be resolved in favor of the
indigenous peoples;
"(4) Section 65 which states that customary laws and practices shall be used to resolve disputes involving
indigenous peoples; and
"(5) Section 66 which vests on the NCIP the jurisdiction over all claims and disputes involving rights of the
indigenous peoples."5
Finally, petitioners assail the validity of Rule VII, Part II, Section 1 of the NCIP Administrative Order No. 1,
series of 1998, which provides that "the administrative relationship of the NCIP to the Office of the President is
characterized as a lateral but autonomous relationship for purposes of policy and program coordination." They
contend that said Rule infringes upon the President’s power of control over executive departments under
Section 17, Article VII of the Constitution.6
Petitioners pray for the following:
"(1) A declaration that Sections 3, 5, 6, 7, 8, 52[I], 57, 58, 59, 63, 65 and 66 and other related provisions of
R.A. 8371 are unconstitutional and invalid;
"(2) The issuance of a writ of prohibition directing the Chairperson and Commissioners of the NCIP to cease
and desist from implementing the assailed provisions of R.A. 8371 and its Implementing Rules;
"(3) The issuance of a writ of prohibition directing the Secretary of the Department of Environment and
Natural Resources to cease and desist from implementing Department of Environment and Natural Resources
Circular No. 2, series of 1998;
"(4) The issuance of a writ of prohibition directing the Secretary of Budget and Management to cease and
desist from disbursing public funds for the implementation of the assailed provisions of R.A. 8371; and
"(5) The issuance of a writ of mandamus commanding the Secretary of Environment and Natural Resources to
comply with his duty of carrying out the State’s constitutional mandate to control and supervise the
exploration, development, utilization and conservation of Philippine natural resources."7
After due deliberation on the petition, the members of the Court voted as follows:
Seven (7) voted to dismiss the petition. Justice Kapunan filed an opinion, which the Chief Justice and Justices
Bellosillo, Quisumbing, and Santiago join, sustaining the validity of the challenged provisions of R.A. 8371.
Justice Puno also filed a separate opinion sustaining all challenged provisions of the law with the exception of
Section 1, Part II, Rule III of NCIP Administrative Order No. 1, series of 1998, the Rules and Regulations
Implementing the IPRA, and Section 57 of the IPRA which he contends should be interpreted as dealing with
the large-scale exploitation of natural resources and should be read in conjunction with Section 2, Article XII of
the 1987 Constitution. On the other hand, Justice Mendoza voted to dismiss the petition solely on the ground
that it does not raise a justiciable controversy and petitioners do not have standing to question the
constitutionality of R.A. 8371.
Seven (7) other members of the Court voted to grant the petition. Justice Panganiban filed a separate opinion
expressing the view that Sections 3 (a)(b), 5, 6, 7 (a)(b), 8, and related provisions of R.A. 8371 are
unconstitutional. He reserves judgment on the constitutionality of Sections 58, 59, 65, and 66 of the law,
which he believes must await the filing of specific cases by those whose rights may have been violated by the
IPRA. Justice Vitug also filed a separate opinion expressing the view that Sections 3(a), 7, and 57 of R.A. 8371
are unconstitutional. Justices Melo, Pardo, Buena, Gonzaga-Reyes, and De Leon join in the separate opinions
of Justices Panganiban and Vitug.
As the votes were equally divided (7 to 7) and the necessary majority was not obtained, the case was
redeliberated upon. However, after redeliberation, the voting remained the same. Accordingly, pursuant to
Rule 56, Section 7 of the Rules of Civil Procedure, the petition is DISMISSED.
Attached hereto and made integral parts thereof are the separate opinions of Justices Puno, Vitug, Kapunan,
Mendoza, and Panganiban.
SO ORDERED.

5. PAJE VS CASINO

G.R. No. 135385 December 6, 2000

ISAGANI CRUZ and CESAR EUROPA, petitioners,
vs.
SECRETARY OF ENVIRONMENT AND NATURAL RESOURCES, SECRETARY OF BUDGET AND MANAGEMENT and
CHAIRMAN and COMMISSIONERS OF THE NATIONAL COMMISSION ON INDIGENOUS PEOPLES, respondents.
HON. JUAN M .FLAVIER, HON. PONCIANO BENNAGEN, BAYANI ASCARRAGA, EDTAMI MANSAYANGAN,
BASILIO WANDAG, EVELYN DUNUAN, YAOM TUGAS, ALFREMO CARPIANO, LIBERATO A. GABIN,
MATERNIDAD M. COLAS, NARCISA M. DALUPINES, BAI KIRAM-CONNIE SATURNO, BAE MLOMO-BEATRIZ T.
ABASALA, DATU BALITUNGTUNG-ANTONIO D. LUMANDONG, DATU MANTUMUKAW TEOFISTO SABASALES,
DATU EDUAARDO BANDA, DATU JOEL UNAD, DATU RAMON BAYAAN, TIMUAY JOSE ANOY, TIMUAY MACARIO
D. SALACAO, TIMUAY EDWIN B. ENDING, DATU SAHAMPONG MALANAW VI, DATU BEN PENDAO CABIGON,
BAI NANAPNAY-LIZA SAWAY, BAY INAY DAYA-MELINDA S. REYMUNDO, BAI TINANGHAGA HELINITA T.
PANGAN, DATU MAKAPUKAW ADOLINO L. SAWAY, DATU MAUDAYAW-CRISPEN SAWAY, VICKY MAKAY,
LOURDES D. AMOS, GILBERT P. HOGGANG, TERESA GASPAR, MANUEL S. ONALAN, MIA GRACE L. GIRON,
ROSEMARIE G. PE, BENITO CARINO, JOSEPH JUDE CARANTES, LYNETTE CARANTES-VIVAL, LANGLEY
SEGUNDO, SATUR S. BUGNAY, CARLING DOMULOT, ANDRES MENDIOGRIN, LEOPOLDO ABUGAN, VIRGILIO
CAYETANO, CONCHITA G. DESCAGA, LEVY ESTEVES, ODETTE G. ESTEVEZ, RODOLFO C. AGUILAR, MAURO
VALONES, PEPE H. ATONG, OFELIA T. DAVI, PERFECTO B. GUINOSAO, WALTER N. TIMOL, MANUEL T.
SELEN, OSCAR DALUNHAY, RICO O. SULATAN, RAFFY MALINDA, ALFREDO ABILLANOS, JESSIE ANDILAB,
MIRLANDO H. MANGKULINTAS, SAMIE SATURNO, ROMEO A. LINDAHAY, ROEL S. MANSANG-CAGAN,
PAQUITO S. LIESES, FILIPE G. SAWAY, HERMINIA S. SAWAY, JULIUS S. SAWAY, LEONARDA SAWAY, JIMMY
UGYUB, SALVADOR TIONGSON, VENANCIO APANG, MADION MALID, SUKIM MALID, NENENG MALID,
MANGKATADONG AUGUSTO DIANO, JOSEPHINE M. ALBESO, MORENO MALID, MARIO MANGCAL, FELAY
DIAMILING, SALOME P. SARZA, FELIPE P. BAGON, SAMMY SALNUNGAN, ANTONIO D. EMBA, NORMA
MAPANSAGONOS, ROMEO SALIGA, SR., JERSON P. GERADA, RENATO T. BAGON, JR., SARING MASALONG,
SOLEDAD M. GERARDA, ELIZABETH L. MENDI, MORANTE S. TIWAN, DANILO M. MALUDAO, MINORS
MARICEL MALID, represented by her father CORNELIO MALID, MARCELINO M. LADRA, represented by her
father MONICO D. LADRA, JENNYLYN MALID, represented by her father TONY MALID, ARIEL M.
EVANGELISTA, represented by her mother LINAY BALBUENA, EDWARD M. EMUY, SR., SUSAN BOLANIO, OND,
PULA BATO B'LAAN TRIBAL FARMER'S ASSOCIATION, INTER-PEOPLE'S EXCHANGE, INC. and GREEN FORUM-
WESTERN VISAYAS, intervenors.
COMMISSION ON HUMAN RIGHTS, intervenor.
IKALAHAN INDIGENOUS PEOPLE and HARIBON FOUNDATION FOR THE CONSERVATION OF NATURAL
RESOURCES, INC., intervenor.
RESOLUTION
PER CURIAM:
Petitioners Isagani Cruz and Cesar Europa brought this suit for prohibition and mandamus as citizens and
taxpayers, assailing the constitutionality of certain provisions of Republic Act No. 8371 (R.A. 8371), otherwise
known as the Indigenous Peoples Rights Act of 1997 (IPRA), and its Implementing Rules and Regulations
(Implementing Rules).
In its resolution of September 29, 1998, the Court required respondents to comment.1 In compliance,
respondents Chairperson and Commissioners of the National Commission on Indigenous Peoples (NCIP), the
government agency created under the IPRA to implement its provisions, filed on October 13, 1998 their
Comment to the Petition, in which they defend the constitutionality of the IPRA and pray that the petition be
dismissed for lack of merit.
On October 19, 1998, respondents Secretary of the Department of Environment and Natural Resources
(DENR) and Secretary of the Department of Budget and Management (DBM) filed through the Solicitor General
a consolidated Comment. The Solicitor General is of the view that the IPRA is partly unconstitutional on the
ground that it grants ownership over natural resources to indigenous peoples and prays that the petition be
granted in part.
On November 10, 1998, a group of intervenors, composed of Sen. Juan Flavier, one of the authors of the
IPRA, Mr. Ponciano Bennagen, a member of the 1986 Constitutional Commission, and the leaders and
members of 112 groups of indigenous peoples (Flavier, et. al), filed their Motion for Leave to Intervene. They
join the NCIP in defending the constitutionality of IPRA and praying for the dismissal of the petition.
On March 22, 1999, the Commission on Human Rights (CHR) likewise filed a Motion to Intervene and/or to
Appear as Amicus Curiae. The CHR asserts that IPRA is an expression of the principle of parens patriae and
that the State has the responsibility to protect and guarantee the rights of those who are at a serious
disadvantage like indigenous peoples. For this reason it prays that the petition be dismissed.
On March 23, 1999, another group, composed of the Ikalahan Indigenous People and the Haribon Foundation
for the Conservation of Natural Resources, Inc. (Haribon, et al.), filed a motion to Intervene with attached
Comment-in-Intervention. They agree with the NCIP and Flavier, et al. that IPRA is consistent with the
Constitution and pray that the petition for prohibition and mandamus be dismissed.
The motions for intervention of the aforesaid groups and organizations were granted.
Oral arguments were heard on April 13, 1999. Thereafter, the parties and intervenors filed their respective
memoranda in which they reiterate the arguments adduced in their earlier pleadings and during the hearing.
Petitioners assail the constitutionality of the following provisions of the IPRA and its Implementing Rules on
the ground that they amount to an unlawful deprivation of the State’s ownership over lands of the public
domain as well as minerals and other natural resources therein, in violation of the regalian doctrine embodied
in Section 2, Article XII of the Constitution:
"(1) Section 3(a) which defines the extent and coverage of ancestral domains, and Section 3(b) which, in turn,
defines ancestral lands;
"(2) Section 5, in relation to section 3(a), which provides that ancestral domains including inalienable public
lands, bodies of water, mineral and other resources found within ancestral domains are private but community
property of the indigenous peoples;
"(3) Section 6 in relation to section 3(a) and 3(b) which defines the composition of ancestral domains and
ancestral lands;
"(4) Section 7 which recognizes and enumerates the rights of the indigenous peoples over the ancestral
domains;
(5) Section 8 which recognizes and enumerates the rights of the indigenous peoples over the ancestral lands;
"(6) Section 57 which provides for priority rights of the indigenous peoples in the harvesting, extraction,
development or exploration of minerals and other natural resources within the areas claimed to be their
ancestral domains, and the right to enter into agreements with nonindigenous peoples for the development
and utilization of natural resources therein for a period not exceeding 25 years, renewable for not more than
25 years; and
"(7) Section 58 which gives the indigenous peoples the responsibility to maintain, develop, protect and
conserve the ancestral domains and portions thereof which are found to be necessary for critical watersheds,
mangroves, wildlife sanctuaries, wilderness, protected areas, forest cover or reforestation."2
Petitioners also content that, by providing for an all-encompassing definition of "ancestral domains" and
"ancestral lands" which might even include private lands found within said areas, Sections 3(a) and 3(b)
violate the rights of private landowners.3
In addition, petitioners question the provisions of the IPRA defining the powers and jurisdiction of the NCIP
and making customary law applicable to the settlement of disputes involving ancestral domains and ancestral
lands on the ground that these provisions violate the due process clause of the Constitution.4
These provisions are:
"(1) sections 51 to 53 and 59 which detail the process of delineation and recognition of ancestral domains and
which vest on the NCIP the sole authority to delineate ancestral domains and ancestral lands;
"(2) Section 52[i] which provides that upon certification by the NCIP that a particular area is an ancestral
domain and upon notification to the following officials, namely, the Secretary of Environment and Natural
Resources, Secretary of Interior and Local Governments, Secretary of Justice and Commissioner of the
National Development Corporation, the jurisdiction of said officials over said area terminates;
"(3) Section 63 which provides the customary law, traditions and practices of indigenous peoples shall be
applied first with respect to property rights, claims of ownership, hereditary succession and settlement of land
disputes, and that any doubt or ambiguity in the interpretation thereof shall be resolved in favor of the
indigenous peoples;
"(4) Section 65 which states that customary laws and practices shall be used to resolve disputes involving
indigenous peoples; and
"(5) Section 66 which vests on the NCIP the jurisdiction over all claims and disputes involving rights of the
indigenous peoples."5
Finally, petitioners assail the validity of Rule VII, Part II, Section 1 of the NCIP Administrative Order No. 1,
series of 1998, which provides that "the administrative relationship of the NCIP to the Office of the President is
characterized as a lateral but autonomous relationship for purposes of policy and program coordination." They
contend that said Rule infringes upon the President’s power of control over executive departments under
Section 17, Article VII of the Constitution.6
Petitioners pray for the following:
"(1) A declaration that Sections 3, 5, 6, 7, 8, 52[I], 57, 58, 59, 63, 65 and 66 and other related provisions of
R.A. 8371 are unconstitutional and invalid;
"(2) The issuance of a writ of prohibition directing the Chairperson and Commissioners of the NCIP to cease
and desist from implementing the assailed provisions of R.A. 8371 and its Implementing Rules;
"(3) The issuance of a writ of prohibition directing the Secretary of the Department of Environment and
Natural Resources to cease and desist from implementing Department of Environment and Natural Resources
Circular No. 2, series of 1998;
"(4) The issuance of a writ of prohibition directing the Secretary of Budget and Management to cease and
desist from disbursing public funds for the implementation of the assailed provisions of R.A. 8371; and
"(5) The issuance of a writ of mandamus commanding the Secretary of Environment and Natural Resources to
comply with his duty of carrying out the State’s constitutional mandate to control and supervise the
exploration, development, utilization and conservation of Philippine natural resources."7
After due deliberation on the petition, the members of the Court voted as follows:
Seven (7) voted to dismiss the petition. Justice Kapunan filed an opinion, which the Chief Justice and Justices
Bellosillo, Quisumbing, and Santiago join, sustaining the validity of the challenged provisions of R.A. 8371.
Justice Puno also filed a separate opinion sustaining all challenged provisions of the law with the exception of
Section 1, Part II, Rule III of NCIP Administrative Order No. 1, series of 1998, the Rules and Regulations
Implementing the IPRA, and Section 57 of the IPRA which he contends should be interpreted as dealing with
the large-scale exploitation of natural resources and should be read in conjunction with Section 2, Article XII of
the 1987 Constitution. On the other hand, Justice Mendoza voted to dismiss the petition solely on the ground
that it does not raise a justiciable controversy and petitioners do not have standing to question the
constitutionality of R.A. 8371.
Seven (7) other members of the Court voted to grant the petition. Justice Panganiban filed a separate opinion
expressing the view that Sections 3 (a)(b), 5, 6, 7 (a)(b), 8, and related provisions of R.A. 8371 are
unconstitutional. He reserves judgment on the constitutionality of Sections 58, 59, 65, and 66 of the law,
which he believes must await the filing of specific cases by those whose rights may have been violated by the
IPRA. Justice Vitug also filed a separate opinion expressing the view that Sections 3(a), 7, and 57 of R.A. 8371
are unconstitutional. Justices Melo, Pardo, Buena, Gonzaga-Reyes, and De Leon join in the separate opinions
of Justices Panganiban and Vitug.
As the votes were equally divided (7 to 7) and the necessary majority was not obtained, the case was
redeliberated upon. However, after redeliberation, the voting remained the same. Accordingly, pursuant to
Rule 56, Section 7 of the Rules of Civil Procedure, the petition is DISMISSED.
Attached hereto and made integral parts thereof are the separate opinions of Justices Puno, Vitug, Kapunan,
Mendoza, and Panganiban.
SO ORDERED.

6. RESIDENT MAMMALS VS REYES

G.R. No. 180771 April 21, 2015

RESIDENT MARINE MAMMALS OF THE PROTECTED SEASCAPE TAÑON STRAIT, e.g., TOOTHED WHALES,
DOLPHINS, PORPOISES, AND OTHER CETACEAN SPECIES, Joined in and Represented herein by Human
Beings Gloria Estenzo Ramos and Rose-Liza Eisma-Osorio, In Their Capacity as Legal Guardians of the Lesser
Life-Forms and as Responsible Stewards of God's Creations, Petitioners,
vs.
SECRETARY ANGELO REYES, in his capacity as Secretary of the Department of Energy (DOE), SECRETARY
JOSE L. ATIENZA, in his capacity as Secretary of the Department of Environment and Natural Resources
(DENR), LEONARDO R. SIBBALUCA, DENR Regional Director-Region VII and in his capacity as Chairperson of
the Tañon Strait Protected Seascape Management Board, Bureau of Fisheries and Aquatic Resources (BFAR),
DIRECTOR MALCOLM J. SARMIENTO, JR., BFAR Regional Director for Region VII ANDRES M. BOJOS, JAPAN
PETROLEUM EXPLORATION CO., LTD. (JAPEX), as represented by its Philippine Agent, SUPPLY OILFIELD
SERVICES, INC. Respondents.
x-----------------------x
G.R. No. 181527
CENTRAL VISAYAS FISHERFOLK DEVELOPMENT CENTER (FIDEC), CERILO D. ENGARCIAL, RAMON YANONG,
FRANCISCO LABID, in their personal capacity and as representatives of the SUBSISTENCE FISHERFOLKS OF
THE MUNICIPALITIES OF ALOGUINSAN AND PINAMUNGAJAN, CEBU, AND THEIR FAMILIES, AND THE
PRESENT AND FUTURE GENERATIONS OF FILIPINOS WHOSE RIGHTS ARE SIMILARLY AFFECTED, Petitioners,
vs.
SECRETARY ANGELO REYES, in his capacity as Secretary of the Department of Energy (DOE), JOSE L.
ATIENZA, in his capacity as Secretary of the Department of Environment and Natural Resources (DENR),
LEONARDO R. SIBBALUCA, in his capacity as DENR Regional Director-Region VII and as Chairperson of the
Tañon Strait Protected Seascape Management Board, ALAN ARRANGUEZ, in his capacity as Director -
Environmental Management Bureau-Region VII, DOE Regional Director for Region VIII1 ANTONIO LABIOS,
JAPAN PETROLEUM EXPLORATION CO., LTD. (JAPEX), as represented by its Philippine Agent, SUPPLY
OILFIELD SERVICES, INC., Respondents.
CONCURRING OPINION
"Until one has loved an animal,
a part of one 's soul remains unawakened."
Anatole France
LEONEN, J.:
I concur in the result, with the following additional reasons.
I
In G.R. No. 180771, petitioners Resident Marine Mammals allegedly bring their case in their personal capacity,
alleging that they stand to benefit or be injured from the judgment on the issues. The human petitioners
implead themselves in a representative capacity "as legal guardians of the lesser life-forms and as responsible
stewards of God's Creations."1 They use Oposa v. Factoran, Jr.2 as basis for their claim, asserting their right
to enforce international and domestic environmental laws enacted for their benefit under the concept of
stipulation pour autrui.3 As the representatives of Resident Marine Mammals, the human petitioners assert
that they have the obligation to build awareness among the affected residents of Tañon Strait as well as to
protect the environment, especially in light of the government's failure, as primary steward, to do its duty
under the doctrine of public trust.4
Resident Marine Mammals and the human petitioners also assert that through this case, this court will have
the opportunity to lower the threshold for locus standi as an exercise of "epistolary jurisdiction."5
The zeal of the human petitioners to pursue their desire to protect the environment and to continue to define
environmental rights in the context of actual cases is commendable. However, the space for legal creativity
usually required for advocacy of issues of the public interest is not so unlimited that it should be allowed to
undermine the other values protected by current substantive and procedural laws. Even rules of procedure as
currently formulated set the balance between competing interests. We cannot abandon these rules when the
necessity is not clearly and convincingly presented.
The human petitioners, in G.R. No. 180771, want us to create substantive and procedural rights for animals
through their allegation that they can speak for them. Obviously, we are asked to accept the premises that (a)
they were chosen by the Resident Marine Mammals of Tañon Strait; (b) they were chosen by a representative
group of all the species of the Resident Marine Mammals; (c) they were able to communicate with them; and
(d) they received clear consent from their animal principals that they would wish to use human legal
institutions to pursue their interests. Alternatively, they ask us to acknowledge through judicial notice that the
interests that they, the human petitioners, assert are identical to what the Resident Marine Mammals would
assert had they been humans and the legal strategies that they invoked are the strategies that they agree
with.
In the alternative, they want us to accept through judicial notice that there is a relationship of guardianship
between them and all the resident mammals in the affected ecology.
Fundamental judicial doctrines that may significantly change substantive and procedural law cannot be
founded on feigned representation.
Instead, I agree that the human petitioners should only speak for themselves and already have legal standing
to sue with respect to the issue raised in their pleading. The rules on standing have already been liberalized to
take into consideration the difficulties in the assertion of environmental rights. When standing becomes too
liberal, this can be the occasion for abuse.
II
Rule 3, Section 1 of the 1997 Rules of Civil Procedure, in part, provides:
SECTION 1. Who may be parties; plaintiff and defendant. - Only natural or juridical persons, or entities
authorized by law may be parties in a civil action.
The Rules provide that parties may only be natural or juridical persons or entities that may be authorized by
statute to be parties in a civil action.
Basic is the concept of natural and juridical persons in our Civil Code:
ARTICLE 37. Juridical capacity, which is the fitness to be the subject of legal relations, is inherent in every
natural person and is lost only through death. Capacity to act, which is the power to do acts with legal effect,
is acquired and may be lost.
Article 40 further defines natural persons in the following manner:
ARTICLE 40. Birth determines personality; but the conceived child shall be considered born for all purposes
that are favorable to it, provided it be born later with the conditions specified 'in the following article.
Article 44, on the other hand, enumerates the concept of a juridical person:
ARTICLE 44. The following are juridical persons:
(1) The State and its political subdivisions;
(2) Other corporations, institutions and entities for public interest or purpose, created by law; their personality
begins as soon as they have been constituted according to law;
(3) Corporations, partnerships and associations for private interest or purpose to which the law grants a
juridical personality, separate and distinct from that of each shareholder, partner or member.
Petitioners in G.R. No. 180771 implicitly suggest that we amend, rather than simply construe, the provisions of
the Rules of Court as well as substantive law to accommodate Resident Marine Mammals or animals. This we
cannot do.
Rule 3, Section 2 of the 1997 Rules of Civil Procedure further defines real party in interest:
SEC. 2. Parties in interest.-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. Unless otherwise authorized by law or these
Rules, every action must be prosecuted or defended in the name of the real party in interest. (2a)6
A litigant who stands to benefit or sustain an injury from the judgment of a case is a real party in interest.7
When a case is brought to the courts, the real party in interest must show that another party's act or omission
has caused a direct injury, making his or her interest both material and based on an enforceable legal right.8
Representatives as parties, on the other hand, are parties acting in representation of the real party in interest,
as defined in Rule 3, Section 3 of the 1997 Rules of Civil Procedure:
SEC. 3. Representatives as parties. - Where the action is allowed to be prosecuted or defended by a
representative or someone acting in a fiduciary capacity, the beneficiary shall be included in the title of the
case and shall be deemed to be the real party in interest. A representative may be a trustee of an express
rust, a guardian, an executor or administrator, or a party authorized by law or these Rules. An agent acting in
his own name and for the benefit of an undisclosed principal may sue or be sued without joining the principal
except when the contract involves things belonging to the principal.(3a)9
The rule is two-pronged. First, it defines .a representative as a party who is not bound to directly or actually
benefit or suffer from the judgment, but instead brings a case in favor of an identified real party in interest.10
The representative is an outsider to the cause of action. Second, the rule provides a list of who may be
considered as "representatives." It is not an exhaustive list, but the rule limits the coverage only to those
authorized by law or the Rules of Court.11
These requirements should apply even in cases involving the environment, which means that for the Petition
of the human petitioners to prosper, they must show that (a) the Resident Marine Mammals are real parties in
interest; and (b) that the human petitioners are authorized by law or the Rules to act in a representative
capacity.
The Resident Marine Mammals are comprised of "toothed whales, dolphins, porpoises, and other cetacean
species inhabiting Tañon Strait."12 While relatively new in Philippine jurisdiction, the issue of whether animals
have legal standing before courts has been the subject of academic discourse in light of the emergence of
animal and environmental rights.
In the United States, anim4l rights advocates have managed to establish a system which Hogan explains as
the "guardianship model for nonhuman animals":13
Despite Animal Lovers, there exists a well-established system by which nonhuman animals may obtain judicial
review to enforce their statutory rights and protections: guardianships. With court approval, animal advocacy
organizations may bring suit on behalf of nonhuman animals in the same way court-appointed guardians bring
suit on behalf of mentally-challenged humans who possess an enforceable right but lack the ability to enforce
it themselves.
In the controversial but pivotal Should Trees Have Standing?-Toward Legal Rights for Natural Objects,
Christopher D. Stone asserts that the environment should possess the right to seek judicial redress even
though it is incapable of representing itself. While asserting the rights of
speechless entities such as the environment or nonhuman animals certainly poses legitimate challenges - such
as identifying the proper spokesman -the American legal system is already well-equipped with a reliable
mechanism by which nonhumans may obtain standing via a judicially established guardianship. Stone notes
that other speechless - and nonhuman - entities such as corporations, states, estates, and municipalities have
standing to bring suit on their own behalf. There is little reason to fear abuses under this regime as
procedures for removal and substitution, avoiding conflicts of interest, and termination of a guardianship are
well established.
In fact, the opinion in Animal Lovers suggests that such an arrangement is indeed possible. The court
indicated that AL VA might have obtained standing in its own right if it had an established history of dedication
to the cause of the humane treatment of animals. It noted that the Fund for Animals had standing and
indicated that another more well-known advocacy organization might have had standing as well. The court
further concluded that an organization's standing is more than a derivative of its history, but history is a
relevant consideration where organizations are not well-established prior to commencing legal action. ALVA
was not the proper plaintiff because it could not identify previous activities demonstrating its recognized
activism for and commitment to the dispute independent of its desire to pursue legal action. The court's
analysis suggests that a qualified organization with a demonstrated commitment to a cause could indeed bring
suit on behalf of the speechless in the form of a court-sanctioned guardianship.
This Comment advocates a shift in contemporary standing doctrine to empower non-profit organizations with
an established history of dedication to the cause and relevant expertise to serve as official guardians ad !item
on behalf of nonhuman animals interests. The American legal system has numerous mechanisms for
representing the rights and interests of nonhumans; any challenges inherent in extending these pre-existing
mechanisms to nonhuman animals are minimal compared to an interest in the proper administration of justice.
To adequately protect the statutory rights of nonhuman animals, the legal system must recognize those
statutory rights independent of humans and provide a viable means of enforcement. Moreover, the idea of a
guardianship for speechless plaintiffs is not new and has been urged on behalf of the natural environment.
'Such a model is even more compelling as applied to nonhuman animals, because they are sentient beings
with the ability to feel pain and exercise rational thought. Thus, animals are qualitatively different from other
legally protected nonhumans and therefore have interests deserving direct legal protection.
Furthermore, the difficulty of enforcing the statutory rights of nonhuman animals threatens the integrity of the
federal statutes designed to protect them, essentially rendering them meaningless. Sensing that laws
protecting nonhuman animals would be difficult to enforce, Congress provided for citizen suit provisions: the
most well-known example is found in the Endangered Species Act (ESA). Such provisions are evidence of
legislative intent to encourage civic participation on behalf of nonhuman animals. Our law of standing should
reflect this intent and its implication that humans are suitable representatives of the natural environment,
which includes nonhuman animals.14 (Emphasis supplied, citation omitted)
When a court allows guardianship as a basis of representation, animals are considered as similarly situated as
individuals who have enforceable rights but, for a legitimate reason (e.g., cognitive disability), are unable to
bring suit for themselves. They are also similar to entities that by their very nature are incapable of speaking
for themselves (e.g., corporations, states, and others).
In our jurisdiction, persons and entities are recognized both in law and the Rules of Court as having standing
to sue and, therefore, may be properly represented as real parties in interest. The same cannot be said about
animals.
Animals play an important role in households, communities, and the environment. While we, as humans, may
feel the need to nurture and protect them, we cannot go as far as saying we represent their best interests and
can, therefore, speak for them before the courts. As humans, we cannot be so arrogant as to argue that we
know the suffering of animals and that we know what remedy they need in the face of an injury.
Even in Hogan's discussion, she points out that in a case before the United States District Court for the Central
District of California, Animal Lovers Volunteer Ass'n v. Weinberger,15 the court held that an emotional
response to what humans perceive to be an injury inflicted on an animal is not within the "zone-of-interest"
protected by law.16 Such sympathy cannot stand independent of or as a substitute for an actual injury
suffered by the claimant.17 The ability to represent animals was further limited in that case by the need to
prove "genuine dedication" to asserting and protecting animal rights:
What ultimately proved fatal to ALVA 's claim, however, was the court's assertion that standing doctrine
further required ALVA to differentiate its genuine dedication to the humane treatment of animals from the
general disdain for animal cruelty shared by the public at large. In doing so, the court found ALVA 's asserted
organizational injury to be abstract and thus relegated ALVA to the ranks of the "concerned bystander. "
....
In fact, the opinion in Animal Lovers suggests that such an arrangement is indeed possible. The court
indicated that ALVA might have obtained standing in its own right if it had an established history of dedication
to the cause of the humane treatment of animals. It noted that the Fund for Animals had standing and
indicated that another more well-known advocacy organization might have had standing as well. The court
further concluded that an organization's standing is more than a derivative of its history, but history is a
relevant consideration where organizations are not well-established prior to commencing legal action. ALVA
was not the proper plaintiff because it could not identify previous activities demonstrating its recognized
activism for and commitment to the dispute independent of its desire to pursue legal action. The court's
analysis suggests that a qualified organization with a demonstrated commitment to a cause could indeed bring
suit on behalf of the speechless in the form of a court-sanctioned guardianship.18 (Emphasis supplied, citation
omitted)
What may be argued as being parallel to this concept of guardianship is the principle of human stewardship
over the environment in a citizen suit under the Rules of Procedure for Environmental Cases. A citizen suit
allows any Filipino to act as a representative of a party who has enforceable rights under environmental laws
before Philippine courts, and is defined in Section 5: .
SEC. 5. Citizen suit. - Any Filipino citizen in representation of others, including minors or generations yet
unborn, may file an action to enforce rights or obligations under environmental laws. Upon the filing of a
citizen suit, the court shall issue an order which shall contain a brief description of the cause of action and the
reliefs prayed for, requiring all interested parties to manifest their interest to intervene in the case within
fifteen (15) days from notice thereof. The plaintiff may publish the order once in a newspaper of a general
circulation in the Philippines or furnish all affected barangays copies of said order.
There is no valid reason in law or the practical requirements of this case to implead and feign representation
on behalf of animals. To have done so betrays a very anthropocentric view of environmental advocacy. There
is no way that we, humans, can claim to speak for animals let alone present that they would wish to use our
court system, which is designed to ensure that humans seriously carry their responsibility including ensuring a
viable ecology for themselves, which of course includes compassion for all living things.
Our rules on standing are sufficient and need not be further relaxed.
In Arigo v. Swift,19 I posed the possibility of further reviewing the broad interpretation we have given to the
rule on standing. While representatives are not required to establish direct injury on their part, they should
only be allowed to represent after complying with the following: [I]t is imperative for them to indicate with
certainty the injured parties on whose behalf they bring the suit. Furthermore, the interest of those they
represent must be based upon concrete legal rights. It is not sufficient to draw out a perceived interest from a
general, nebulous idea of a potential "injury."20
I reiterate my position in Arigo v. Swift and in Paje v. Casiño21 regarding this rule alongside the appreciation
of legal standing in Oposa v. Factoran22 for environmental cases. In Arigo, I opined that procedural liberality,
especially in cases brought by representatives, should be used with great caution:
Perhaps it is time to revisit the ruling in Oposa v. Factoran.
That case was significant in that, at that time, there was need to call attention to environmental concerns in
light of emerging international legal principles. While "intergenerational responsibility" is a noble principle, it
should not be used to obtain judgments that would preclude future generations from making their own
assessment based on their actual concerns. The present generation must restrain itself from assuming that it
can speak best for those who will exist at a different time, under a different set of circumstances. In essence,
the unbridled resort to representative suit will inevitably result in preventing future generations from
protecting their own rights and pursuing their own interests and decisions. It reduces the autonomy of our
children and our children 's children. Even before they are born, we again restricted their ability to make their
own arguments.
It is my opinion that, at best, the use of the Oposa doctrine in environmental cases should be allowed only
when a) there is a clear legal basis for the representative suit; b) there are actual concerns based squarely
upon an existing legal right; c) there is no possibility of any countervailing interests existing within the
population represented or those that are yet to be born; and d) there is an absolute necessity for such
standing because there is a threat of catastrophe so imminent that an immediate protective measure is
necessary. Better still, in the light of its costs and risks, we abandon the precedent all together.23 (Emphasis
in the original)
Similarly, in Paje:
A person cannot invoke the court's jurisdiction if he or she has no right or interest to protect. He or she who
invokes the court's jurisdiction must be the "owner of the right sought to be enforced." In other words, he or
she must have a cause of action. An action may be dismissed on the ground of lack of cause of action if the
person who instituted it is not the real party in interest.24 The term "interest" under the Rules of Court must
refer to a material interest that is not merely a curiosity about or an "interest in the question involved." The
interest must be present and substantial. It is not a mere expectancy or a future, contingent interest.
A person who is not a real party in interest may institute an action if he or she is suing as representative of a
.real party in interest. When an action is prosecuted or defended by a representative, that representative is
not and does not become the real party in interest. The person represented is deemed the real party in
interest. The representative remains to be a third party to the action instituted on behalf of another.
....
To sue under this rule, two elements must be present: "(a) the suit is brought on behalf of an identified party
whose right has been violated, resulting in some form of damage, and (b) the representative authorized by
law or the Rules of Court to represent the victim."
The Rules of Procedure for Environmental Cases allows filing of a citizen's suit. A citizen's suit under this rule
allows any Filipino citizen to file an action for the enforcement of environmental law on behalf of minors or
generations yet unborn. It is essentially a representative suit that allows persons who are not real parties in
interest to institute actions on behalf of the real party in interest.
The expansion of what constitutes "real party in interest" to include minors and generations yet unborn is a
recognition of this court's ruling in Oposa v. Factoran. This court recognized the capacity of minors
(represented by their parents) to file a class suit on behalf of succeeding generations based on the concept of
intergenerational responsibility to ensure the future generation's access to and enjoyment of [the] country's
natural resources.
To allow citizen's suits to enforce environmental rights of others, including future generations, is dangerous for
three reasons:
First, they run the risk of foreclosing arguments of others who are unable to take part in the suit, putting into.
question its representativeness. Second, varying interests may potentially result in arguments that are
bordering on political issues, the resolutions of which do not fall upon this court. Third, automatically allowing
a class or citizen's suit on behalf of minors and generations yet unborn may result in the oversimplification of
what may be a complex issue, especially in light of the impossibility of determining future generation's true
interests on the matter.
In citizen's suits, persons who may have no interest in the case may file suits for others. Uninterested persons
will argue for the persons they represent, and the court will decide based on their evidence and arguments.
Any decision by the court will be binding upon the beneficiaries, which in this case are the minors and the
future generations. The court's decision will be res judicata upon them and conclusive upon the issues
presented.25
The danger in invoking Oposa v. Factoran to justify all kinds of environmental claims lies in its potential to
diminish the value of legitimate environmental rights. Extending the application of "real party in interest" to
the Resident Marine Mammals, or animals in general, through a judicial pronouncement will potentially result
in allowing petitions based on mere concern rather than an actual enforcement of a right. It is impossible for
animals to tell humans what their concerns are. At best, humans can only surmise the extent of injury inflicted,
if there be any. Petitions invoking a right and seeking legal redress before this court cannot be a product of
guesswork, and representatives have the responsibility to ensure that they bring "reasonably cogent, rational,
scientific, well-founded arguments"26 on behalf of those they represent.
Creative approaches to fundamental problems should be welcome. However, they should be considered
carefully so that no unintended or unwarranted consequences should follow. I concur with the approach of
Madame Justice Teresita J. Leonardo-De Castro in her brilliant ponencia as it carefully narrows down the
doctrine in terms of standing. Resident Marine Mammals and the human petitioners have no legal standing to
file any kind of petition.
However, I agree that petitioners in G.R. No. 181527, namely, Central Visayas Fisherfolk Development Center,.
Engarcial, Yanong, and Labid, have standing both as real parties in interest and as representatives of
subsistence fisherfolks of the Municipalities of Aloguinsan and Pinamungahan, Cebu, and their families, and
the present and future generations of Filipinos whose rights are similarly affected. The activities undertaken
under Service Contract 46 (SC-46) directly affected their source of livelihood, primarily felt through the
significant reduction of their fish harvest.27 The actual, direct, and material damage they suffered, which has
potential long-term effects transcending generations, is a proper subject of a legal suit.
III
In our jurisdiction, there is neither reason nor any legal basis for the concept of implied petitioners, most
especially when the implied petitioner was a sitting President of the Republic of the Philippines. In G.R. No.
180771, apart from adjudicating unto themselves the status of "legal guardians" of whales, dolphins,
porpoises, and other cetacean species, human petitioners also impleaded Former President Gloria Macapagal-
Arroyo as "unwilling co-petitioner" for "her express declaration and undertaking in the ASEAN Charter to
protect Tañon Strait."28
No person may implead any other person as a co-plaintiff or co-petitioner without his or her consent. In our
jurisdiction, only when there is a party that should have been a necessary party but was unwilling to join
would there be an allegation as to why that party has been omitted. In Rule 3, Section 9 of the 1997 Rules of
Civil Procedure:
SEC. 9. Non-joinder of necessary parties to be pleaded. -Whenever in any pleading in which a claim is asserted
a necessary party is not joined, the pleader shall set forth his name, if known, and shall state why he is
omitted. Should the court find the reason for the omission unmeritorious, it may order the inclusion of the
omitted necessary party if jurisdiction over his person may be obtained.
The failure to comply with the order for his inclusion, without justifiable cause, shall be deemed a waiver of
the claim against such party.
The non-inclusion of a necessary party does not prevent the court from proceeding in the action, and the
judgment rendered therein shall be without prejudice to the rights of such necessary party.29
A party who should have been a plaintiff or petitioner but whose consent cannot be obtained should be
impleaded as a defendant in the nature of an unwilling co-plaintiff under Rule 3, Section 10 of the 1997 Rules
of Civil Procedure:
SEC. 10. Unwilling co-plaintiff. - If the consent of any party who should be joined as plaintiff can not be
obtained, he may be made a defendant and the reason therefor shall be stated in the complaint.30
The reason for this rule is plain: Indispensable party plaintiffs who should be part of the action but who do not
consent should be put within the jurisdiction of the court through summons or other court processes.
Petitioners. should not take it upon themselves to simply imp lead any party who does not consent as a
petitioner. This places the unwilling co-petitioner at the risk of being denied due process.
Besides, Former President Gloria Macapagal-Arroyo cannot be a party to this suit. As a co-equal constitutional
department, we cannot assume that the President needs to enforce policy directions by suing his or her alter-
egos. The procedural situation caused by petitioners may have gained public attention, but its legal absurdity
borders on the contemptuous. The Former President's name should be stricken out of the title of this case.
IV
I also concur with the conclusion that SC-46 is both. illegal and unconstitutional.
SC-46 is illegal because it violates Republic Act No. ·7586 or the National Integrated Protected Areas System
Act of 1992, and Presidential Decree No. 1234,31 which declared Tañon Strait as a protected seascape. It is
unconstitutional because it violates the fourth paragraph of Article XII, Section 2 of the Constitution.
V
Petitioner Central Visayas Fisherfolk Development Center asserts that SC-46 violated Article XII, Section 2,
paragraph 1 of the .1987 Constitution because Japan Petroleum Exploration Co., Ltd. (JAPEX) is 100%
Japanese-owned.32 It further asserts that SC-46 cannot be validly classified as a technical and financial
assistance agreement executed under Article XII, Section 2, paragraph 4 of the 1987 Constitution.33 Public
respondents counter that SC-46 does not fall under the coverage of paragraph 1, but is a validly executed
contract under paragraph 4.34· Public respondents further aver that SC-46 neither granted exclusive fishing
rights to JAPEX nor violated Central Visayas Fisherfolk Development Center's right to preferential use of
communal marine and fishing resources.35
VI
Article XII, Section 2 of the 1987 Constitution states:
Section 2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned
by the State. With the exception. of agricultural lands, all other natural resources shall not be alienated. The
exploration, development, and utilization of natural resources shall be under the full control and supervision of
the State. The State may directly undertake such activities, or it may enter into co-production, joint venture, or
production-sharing agreements with Filipino citizens, or corporations or associations at least sixty per centum
of whose capital is owned by such citizens. Such agreements may be for a period not exceeding twenty-five
years, renewable for not more than twenty-five years, and under such terms and conditions as may be
provided by law. In cases of water rights for irrigation, water supply fisheries, or industrial uses other than the
development of water power, beneficial use may be the measure and limit of the grant.
The State shall protect the nation's marine wealth in its archipelagic waters, territorial sea, and exclusive
economic zone, and reserve its use and enjoyment exclusively to Filipino citizens.
The Congress may, by law, allow small-scale utilization of natural resources by Filipino citizens, as well as
cooperative fish farming, with priority to subsistence fishermen and fish-workers in rivers, lakes, bays, and
lagoons.
The President may enter into agreements with foreign-owned corporations involving either technical or
financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other
mineral oils according to the general terms and conditions provided by law, based on real contributions to the
economic growth and general welfare of the country. In such agreements, the State shall promote the
development and use of local scientific and technical resources.
The President shall notify the Congress of every contract entered into in accordance with this provision, within
thirty days from its execution. (Emphasis supplied)
I agree that fully foreign-owned corporations may participate in the exploration, development, and use of
natural resources, but only through either financial agreements or technical ones. This is the clear import of
the words "either financial or technical assistance agreements." This is also
the clear result if we compare the 1987 constitutional provision with the versions in the 1973 and 1935
Constitution:
1973 CONSTITUTION
ARTICLE XIV
THE NATIONAL ECONOMY AND THE PATRIMONY OF THE NATION
SEC. 9. The disposition, exploration, development, of exploitation, or utilization of any of the natural resources
of the Philippines shall be limited to citizens of the Philippines, or to corporations or association at least sixty
per centum of the capital of which is owned by such citizens. The Batasang Pambansa, in the national interest,
may allow such citizens, corporations, or associations to enter into service contracts for financial, technical,
management, or other forms of assistance with any foreign person or entity for the exploitation, development,
exploitation, or utilization of any of the natural resources. Existing valid and binding service contracts for
financial, the technical, management, or other forms of assistance are hereby recognized as such. (Emphasis
supplied)
1935 CONSTITUTION
ARTICLE XIII
CONSERVATION AND UTILIZATION OF NATURAL RESOURCES
SECTION 1. All agricultural timber, and mineral. lands of the public domain, waters, minerals, coal, petroleum,
and other mineral oils, all forces of potential energy, and other natural resources of the Philippines belong to
the State, and their disposition, exploitation, development, or utilization shall be limited to citizens of the
Philippines, or to corporations or associations at least sixty per centum of the capital of which is owned by
such citizens, subject to any existing right, grant, lease, or concession at the time of the inauguration of the
Government established under this Constitution. Natural resources, with the exception of public agricultural
land, shall not be alienated, and no license, concession, or lease for the exploitation, development, or
utilization of any of the natural resources shall be granted for a period exceeding twenty-five years, renewable
for another twenty-five years, except as to water rights for irrigation, water supply, fisheries, or industrial uses
other than the development of water power, in which cases beneficial use may be the measure and the limit of
the grant.
The clear text of the Constitution in light of its history prevails over any attempt to infer interpretation from
the Constitutional Commission deliberations. The constitutional texts are the product of a full sovereign act:
deliberations in a constituent assembly and ratification. Reliance on recorded discussion of Constitutional
Commissions, on the other hand, may result in dependence on incomplete authorship; Besides, it opens
judicial review to further subjectivity from those who spoke during the Constitutional Commission deliberations
who may not have predicted how their words will be used. It is safer that we use the words already in the
Constitution. The Constitution was their product. Its words were read by those who ratified it. The Constitution
is what society relies upon even at present.
SC-46 is neither a financial assistance nor a technical assistance agreement.
Even supposing for the sake of argument that it is, it could not be declared valid in light of the standards set
forth in La Bugal-B'laan Tribal Association, Inc. v. Ramos:36
Such service contracts may be entered into only with respect to minerals, petroleum and other mineral oils.
The grant thereof is subject to several safeguards, among which are these requirements:
(1) The service contract shall be crafted m accordance with a general law that will set standard or uniform
terms, conditions and requirements, presumably to attain a certain uniformity in provisions and avoid the
possible insertion of terms disadvantageous to the country.
(2) The President shall be the signatory for the government because, supposedly before an agreement is
presented to the President for signature, it will have been vetted several times over at different levels to
ensure that it conforms to law and can withstand public scrutiny.
(3) Within thirty days of the executed agreement, the President shall report it to Congress to give that branch
of government an opportunity to look over the agreement and interpose timely objections, if any.37 (Emphasis
in the original, citation omitted)

Based on the standards pronounced in La Bugal, SC-46' S validity must be tested against three important
points: (a) whether SC-46 was crafted in accordance with a general law that provides standards, terms, and
conditions; (b) whether SC-46 was signed by the President for and on behalf of the government; and (c)
whether it was reported by the President to Congress within 30 days of execution.
VII
The general law referred to as a possible basis for SC-46's validity is Presidential Decree No. 87 or the Oil
Exploration and Development Act of 1972.1âwphi1 It is my opinion that this law is unconstitutional in that it
allows service contracts, contrary to Article XII, Section 2 of the 1987 Constitution:
The President may enter into agreements with foreign-owned corporations involving either technical or
financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other
mineral oils according to the general terms and conditions provided by law, based on real contributions to the
economic growth and general welfare of the country. In such agreements, the State shall promote the
development and use of local scientific and technical resources. (Emphasis supplied)
The deletion of service contracts from the enumeration of the kind of agreements the President may enter into
with foreign-owned corporations for exploration and utilization of resources means that service contracts are
no longer allowed by the Constitution. Pursuant to Article XVIII, Section 3 of the 1987 Constitution,38 this
inconsistency renders the law invalid and ineffective.
SC-46 suffers from the lack of a special law allowing its activities. The Main Opinion emphasizes an important
point, which is that SC-46 did not merely involve exploratory activities, but also provided the rights and
obligations of the parties should it be discovered that there is oil in commercial quantities in the area. The
Tañon Strait being a protected seascape under Presidential Decree No. 123439 requires that the exploitation
and utilization of energy resources from that area are explicitly covered by a law passed by Congress
specifically for that purpose, pursuant to Section 14 of Republic Act No. 7586 or the National Integrated
Protected Areas System Act of 1992:
SEC. 14. Survey for Energy R6'sources. - Consistent with the policies declared in Section 2, hereof, protected
areas, except strict nature reserves and natural parks, may be subjected to exploration only for the purpose of
gathering information on energy resources and only if such activity is carried out with the least damage to
surrounding areas. Surveys shall be conducted only in accordance with a program approved by the DENR, and
the result of such surveys shall be made available to the public and submitted to the President for
recommendation to Congress. Any exploitation and utilization of energy resources found within NIP AS areas
shall be allowed only through a law passed by Congress.40 (Emphasis supplied)
No law was passed by Congress specifically providing the standards, terms, and conditions of an oil
exploration, extraction, and/or utilization for Tañon Strait and, therefore, no such activities could have been
validly undertaken under SC-46. The National Integrated Protected Areas System Act of 1992 is clear that
exploitation and utilization of energy resources in a protected seascape such as Tañon Strait shall only be
allowed through a specific law.
VIII
Former President Gloria Macapagal-Arroyo was not the signatory to SC-46, contrary to the requirement set by
paragraph 4 of Article XII, Section 2 for service contracts involving the exploration of petroleum. SC-46 was
entered into by then Department of Energy Secretary Vicente S. Perez, Jr., on behalf of the government. I
agree with the Main Opinion that in cases where the Constitution or law requires the President to act
personally on the matter, the duty cannot be delegated to another public official.41 La Bugal highlights the
importance of the President's involvement, being one of the constitutional safeguards against abuse and
corruption, as not mere formality:
At this point, we sum up the matters established, based on a careful reading of the ConCom deliberations, as
follows:
• In their deliberations on what was to become paragraph 4, the framers used the term service contracts in
referring to agreements x x x involving either technical or financial assistance. • They spoke of service
contracts as the concept was understood in the 1973 Constitution.
• It was obvious from their discussions that they were not about to ban or eradicate service contracts.
• Instead, they were plainly crafting provisions to. put in place safeguards that would eliminate or m minimize
the abuses prevalent during the marital law regime.42 (Emphasis in the original)
Public respondents failed to show that. Former President Gloria Macapagal-Arroyo was involved in the signing
or execution of SC-46. The failure to comply with this constitutional requirement renders SC-46 null and void.
IX
Public respondents also failed to show that Congress was subsequently informed of the execution and
existence of SC-46. The reporting requirement is an equally important requisite to the validity of any service
contract involving the exploration, development, and utilization of Philippine petroleum. Public respondents'
failure to report to Congress about SC-46 effectively took away any opportunity for the legislative branch to
scrutinize its terms and conditions.
In sum, SC-46 was executed and implemented absent all the requirements provided under paragraph 4 of
Article XII, Section 2. It is, therefore, null and void.
X
I am of the view that SC-46, aside from not having complied with the 1987 Constitution, is also null and void
for being violative of environmental laws protecting Tañon Strait. In particular, SC-46 was implemented
despite falling short of the requirements of the National Integrated Protected Areas System Act of 1992.
As a protected seascape under Presidential Decree No. 1234,43 Tañon Strait is covered by the National
Integrated Protected Areas System Act of 1992. This law declares as a matter of policy:
SEC. 2. Declaration of Policy. Cognizant of the profound impact of man's activities on all components of the
natural environment particularly the effect of increasing population, resource exploitation and industrial
advancement and recognizing the critical importance of protecting and maintaining the natural biological and
physical diversities of the environment notably on areas with biologically unique features to sustain human life
and development, as well as plant and animal life, it is hereby declared the policy of the State to secure for the
Filipino people of present and future generations the perpetual existence of all native plants and animals
through the establishment of a comprehensive system of integrated protected areas within the classification of
national park as provided for in the Constitution.
It is hereby recognized that these areas, although distinct in features, possess common ecological values that
may be incorporated into a holistic plan representative of our natural heritage; that effective administration of
these areas is possible only through cooperation among national government, local and concerned private
organizations; that the use and enjoyment of these protected areas must be consistent with the principles of
biological diversity and sustainable development.
To this end, there is hereby established a National Integrated Protected Areas System (NIPAS), which shall
encompass outstanding remarkable areas and biologically important public lands that are habitats of rare and
endangered species of plants and animals, biogeographic zones and related ecosystems, whether terrestrial,
wetland or marine, all of which shall be designated as "protected areas."44 (Emphasis supplied)
Pursuant to this law, any proposed activity in Tañon Strait must undergo an Environmental Impact
Assessment:
SEC. 12. Environmental Impact Assessment. - Proposals for activities which are outside the scope of the
management plan for protected areas shall be subject to an environmental impact assessment as required by
law before they are adopted, and the results thereof shall be taken into consideration in the decision-making
process.45 (Emphasis supplied)
The same provision further requires that an Environmental Compliance Certificate be secured under the
Philippine Environmental Impact Assessment System before arty project is implemented:
No actual implementation of such activities shall be allowed without the required Environmental Compliance
Certificate (ECC) under the Philippine Environment Impact Assessment (EIA) system. In instances where such
activities are allowed to be undertaken, the proponent shall plan and carry them out in such manner as will
minimize any adverse effects and take preventive and remedial action when appropriate. The proponent shall
be liable for any damage due to lack of caution or indiscretion.46 (Emphasis supplied)
In projects involving the exploration or utilization of energy resources, the National Integrated Protected Areas
System Act of 1992 additionally requires that a program be approved by the Department of Environment and
Natural Resources, which shall be publicly accessible. The program shall also be submitted to the President,
who in turn will recommend the program to Congress. Furthermore, Congress must enact a law specifically
allowing the exploitation of energy resources found within a protected area such as Tañon Strait:
SEC. 14. Survey for Energy Resources. - Consistent with the policies declared in Section 2, hereof, protected
areas, except strict nature reserves and natural parks, may be subjected to exploration only for the purpose of
gathering information on energy resources and only if such activity is carried out with the least damage to
surrounding areas. Surveys shall be conducted only in accordance with a program approved by the DENR, and
the result of such surveys shall be made available to the public and submitted to the President for
recommendation to Congress. Any exploitation and utilization of energy resources found within NIPAS areas
shall be allowed only through a taw passed by Congress.47 (Emphasis supplied)
Public respondents argue that SC-46 complied with the procedural requirements of obtaining an Environmental
Compliance Certificate.48 At any rate, they assert that the activities covered by SC-46 fell under Section 14 of
the National Integrated Protected Areas System Act of 1992, which they interpret to be an exception to
Section 12. They argue that the Environmental Compliance Certificate is not a strict requirement for the
validity of SC-46 since (a) the Tañon Strait is not a nature' reserve or natural park; (b) the exploration was
merely for gathering information; and ( c) measures were in place to ensure that the exploration caused the
least possible damage to the area.49
Section 14 is not an exception to Section 12, but instead provides additional requirements for cases involving
Philippine energy resources. The National Integrated Protected Areas System Act of 1992 was enacted to
recognize the importance of protecting the environment in light of resource exploitation, among others.50
Systems are put in place to secure for Filipinos local resources under the most favorable conditions. With the
status of Tañon Strait as a protected seascape, the institution of additional legal safeguards is even more
significant.
Public respondents did not validly obtain an Environmental Compliance Certificate for SC-46. Based on the
records, JAPEX commissioned an environmental impact evaluation only in the second subphase of its project,
with the Environmental Management .Bureau of Region
VII granting the project an Environmental Compliance Certificate on March 6, 2007.51
Despite its scale, the seismic surveys from May 9 to 18, 2005 were conducted without any environmental
assessment contrary to Section 12 of the National Integrated Protected Areas System Act of 1992.
XI
Finally, we honor every living creature when we take care of our environment. As sentient species, we do not
lack in the wisdom or sensitivity to realize that we only borrow the resources that we use to survive and to
thrive. We are not incapable of mitigating the greed that is slowly causing the demise of our planet. Thus,
there is no need for us to feign representation of any other species or some imagined unborn generation in
filing any action in our courts of law to claim any of our fundamental rights to a healthful ecology. In this way
and with candor and courage, we fully shoulder the responsibility deserving of the grace and power endowed
on our species.
ACCORDINGLY, I vote:
(a) to DISMISS G.R. No. 180771 for lack of standing and STRIKE OUT the name of Former President Gloria
Macapagal-Arroyo from the title of this case;
(b) to GRANT G.R. No. 181527; and
(c) to DECLARE SERVICE CONTRACT 46 NULL AND VOID for violating the 1987 Constitution, Republic Act No.
7586, and Presidential Decree No. 1234.

7. BORACAY FOUNDATION VS AKLAN

G.R. No. 196870 June 26, 2012

BORACAY FOUNDATION, INC., Petitioner,
vs.
THE PROVINCE OF AKLAN, REPRESENTED BY GOVERNOR CARLITO S. MARQUEZ, THE PHILIPPINE
RECLAMATION AUTHORITY, AND THE DENR-EMB (REGION VI), Respondents.
DECISION
LEONARDO-DE CASTRO, J.:
In resolving this controversy, the Court took into consideration that all the parties involved share common
goals in pursuit of certain primordial State policies and principles that are enshrined in the Constitution and
pertinent laws, such as the protection of the environment, the empowerment of the local government units,
the promotion of tourism, and the encouragement of the participation of the private sector. The Court seeks to
reconcile the respective roles, duties and responsibilities of the petitioner and respondents in achieving these
shared goals within the context of our Constitution, laws and regulations.
Nature of the Case
This is an original petition for the issuance of an Environmental Protection Order in the nature of a continuing
mandamus under A.M. No. 09-6-8-SC, otherwise known as the Rules of Procedure for Environmental Cases,
promulgated on April 29, 2010.
The Parties
Petitioner Boracay Foundation, Inc. (petitioner) is a duly registered, non-stock domestic corporation. Its
primary purpose is "to foster a united, concerted and environment-conscious development of Boracay Island,
thereby preserving and maintaining its culture, natural beauty and ecological balance, marking the island as
the crown jewel of Philippine tourism, a prime tourist destination in Asia and the whole world."1 It counts
among its members at least sixty (60) owners and representatives of resorts, hotels, restaurants, and similar
institutions; at least five community organizations; and several environmentally-conscious residents and
advocates.2
Respondent Province of Aklan (respondent Province) is a political subdivision of the government created
pursuant to Republic Act No. 1414, represented by Honorable Carlito S. Marquez, the Provincial Governor
(Governor Marquez).
Respondent Philippine Reclamation Authority (respondent PRA), formerly called the Public Estates Authority
(PEA), is a government entity created by Presidential Decree No. 1084,3 which states that one of the purposes
for which respondent PRA was created was to reclaim land, including foreshore and submerged areas. PEA
eventually became the lead agency primarily responsible for all reclamation projects in the country under
Executive Order No. 525, series of 1979. In June 2006, the President of the Philippines issued Executive Order
No. 543, delegating the power "to approve reclamation projects to PRA through its governing Board, subject to
compliance with existing laws and rules and further subject to the condition that reclamation contracts to be
executed with any person or entity (must) go through public bidding."4
Respondent Department of Environment and Natural Resources – Environmental Management Bureau (DENR-
EMB), Regional Office VI (respondent DENR-EMB RVI), is the government agency in the Western Visayas
Region authorized to issue environmental compliance certificates regarding projects that require the
environment’s protection and management in the region.5
Summary of Antecedent Facts
Boracay Island (Boracay), a tropical paradise located in the Western Visayas region of the Philippines and one
of the country’s most popular tourist destinations, was declared a tourist zone and marine reserve in 1973
under Presidential Proclamation No. 1801.6 The island comprises the barangays of Manoc-manoc, Balabag,
and Yapak, all within the municipality of Malay, in the province of Aklan.7
Petitioner describes Boracay as follows:
Boracay is well-known for its distinctive powdery white-sand beaches which are the product of the unique
ecosystem dynamics of the area. The island itself is known to come from the uplifted remnants of an ancient
reef platform. Its beaches, the sandy land strip between the water and the area currently occupied by
numerous establishments, is the primary draw for domestic and international tourists for its color, texture and
other unique characteristics. Needless to state, it is the premier domestic and international tourist destination
in the Philippines.8
More than a decade ago, respondent Province built the Caticlan Jetty Port and Passenger Terminal at
Barangay Caticlan to be the main gateway to Boracay. It also built the corresponding Cagban Jetty Port and
Passenger Terminal to be the receiving end for tourists in Boracay. Respondent Province operates both ports
"to provide structural facilities suited for locals, tourists and guests and to provide safety and security
measures."9
In 2005, Boracay 2010 Summit was held and participated in by representatives from national government
agencies, local government units (LGUs), and the private sector. Petitioner was one of the organizers and
participants thereto. The Summit aimed "to re-establish a common vision of all stakeholders to ensure the
conservation, restoration, and preservation of Boracay Island" and "to develop an action plan that [would
allow] all sectors to work in concert among and with each other for the long term benefit and sustainability of
the island and the community."10 The Summit yielded a Terminal Report11 stating that the participants had
shared their dream of having world-class land, water and air infrastructure, as well as given their observations
that government support was lacking, infrastructure was poor, and, more importantly, the influx of tourists to
Boracay was increasing. The Report showed that there was a need to expand the port facilities at Caticlan due
to congestion in the holding area of the existing port, caused by inadequate facilities, thus tourists suffered
long queues while waiting for the boat ride going to the island.12
Respondent Province claimed that tourist arrivals to Boracay reached approximately 649,559 in 2009 and
779,666 in 2010, and this was expected to reach a record of 1 million tourist arrivals in the years to come.
Thus, respondent Province conceptualized the expansion of the port facilities at Barangay Caticlan.13
The Sangguniang Barangay of Caticlan, Malay Municipality, issued Resolution No. 13, s. 200814 on April 25,
2008 stating that it had learned that respondent Province had filed an application with the DENR for a
foreshore lease of areas along the shorelines of Barangay Caticlan, and manifesting its strong opposition to
said application, as the proposed foreshore lease practically covered almost all the coastlines of said barangay,
thereby technically diminishing its territorial jurisdiction, once granted, and depriving its constituents of their
statutory right of preference in the development and utilization of the natural resources within its jurisdiction.
The resolution further stated that respondent Province did not conduct any consultations with the
Sangguniang Barangay of Caticlan regarding the proposed foreshore lease, which failure the Sanggunian
considered as an act of bad faith on the part of respondent Province.15
On November 20, 2008, the Sangguniang Panlalawigan of respondent Province approved Resolution No. 2008-
369,16 formally authorizing Governor Marquez to enter into negotiations towards the possibility of effecting
self-liquidating and income-producing development and livelihood projects to be financed through bonds,
debentures, securities, collaterals, notes or other obligations as provided under Section 299 of the Local
Government Code, with the following priority projects: (a) renovation/rehabilitation of the Caticlan/Cagban
Passenger Terminal Buildings and Jetty Ports; and (b) reclamation of a portion of Caticlan foreshore for
commercial purposes.17 This step was taken as respondent Province’s existing jetty port and passenger
terminal was funded through bond flotation, which was successfully redeemed and paid ahead of the target
date. This was allegedly cited as one of the LGU’s Best Practices wherein respondent Province was given the
appropriate commendation.18
Respondent Province included the proposed expansion of the port facilities at Barangay Caticlan in its 2009
Annual Investment Plan,19 envisioned as its project site the area adjacent to the existing jetty port, and
identified additional areas along the coastline of Barangay Caticlan as the site for future project expansion.20
Governor Marquez sent a letter to respondent PRA on March 12, 200921 expressing the interest of respondent
Province to reclaim about 2.64 hectares of land along the foreshores of Barangay Caticlan, Municipality of
Malay, Province of Aklan.
Sometime in April 2009, respondent Province entered into an agreement with the Financial Advisor/Consultant
that won in the bidding process held a month before, to conduct the necessary feasibility study of the
proposed project for the Renovation/Rehabilitation of the Caticlan Passenger Terminal Building and Jetty Port,
Enhancement and Recovery of Old Caticlan Coastline, and Reclamation of a Portion of Foreshore for
Commercial Purposes (the Marina Project), in Malay, Aklan.22
Subsequently, on May 7, 2009, the Sangguniang Panlalawigan of respondent Province issued Resolution No.
2009–110,23 which authorized Governor Marquez to file an application to reclaim the 2.64 hectares of
foreshore area in Caticlan, Malay, Aklan with respondent PRA.
Sometime in July 2009, the Financial Advisor/Consultant came up with a feasibility study which focused on the
land reclamation of 2.64 hectares by way of beach enhancement and recovery of the old Caticlan coastline for
the rehabilitation and expansion of the existing jetty port, and for its future plans – the construction of
commercial building and wellness center. The financial component of the said study was Two Hundred Sixty
Million Pesos (₱260,000,000.00). Its suggested financing scheme was bond flotation.24
Meanwhile, the Sangguniang Bayan of the Municipality of Malay expressed its strong opposition to the
intended foreshore lease application, through Resolution No. 044,25 approved on July 22, 2009, manifesting
therein that respondent Province’s foreshore lease application was for business enterprise purposes for its
benefit, at the expense of the local government of Malay, which by statutory provisions was the rightful entity
"to develop, utilize and reap benefits from the natural resources found within its jurisdiction."26
In August 2009, a Preliminary Geohazard Assessment27 for the enhancement/expansion of the existing
Caticlan Jetty Port and Passenger Terminal through beach zone restoration and Protective Marina
Developments in Caticlan, Malay, Aklan was completed.
Thereafter, Governor Marquez submitted an Environmental Performance Report and Monitoring Program
(EPRMP)28 to DENR-EMB RVI, which he had attached to his letter29 dated September 19, 2009, as an initial
step for securing an Environmental Compliance Certificate (ECC). The letter reads in part:
With the project expected to start its construction implementation next month, the province hereby assures
your good office that it will give preferential attention to and shall comply with whatever comments that you
may have on this EPRMP.30 (Emphasis added.)
Respondent Province was then authorized to issue "Caticlan Super Marina Bonds" for the purpose of funding
the renovation of the Caticlan Jetty Port and Passenger Terminal Building, and the reclamation of a portion of
the foreshore lease area for commercial purposes in Malay, Aklan through Provincial Ordinance No. 2009-013,
approved on September 10, 2009. The said ordinance authorized Governor Marquez to negotiate, sign and
execute agreements in relation to the issuance of the Caticlan Super Marina Bonds in the amount not
exceeding ₱260,000,000.00.31
Subsequently, the Sangguniang Panlalawigan of the Province of Aklan issued Provincial Ordinance No. 2009-
01532 on October 1, 2009, amending Provincial Ordinance No. 2009-013, authorizing the bond flotation of the
Province of Aklan through Governor Marquez to fund the Marina Project and appropriate the entire proceeds of
said bonds for the project, and further authorizing Governor Marquez to negotiate, sign and execute contracts
or agreements pertinent to the transaction.33
Within the same month of October 2009, respondent Province deliberated on the possible expansion from its
original proposed reclamation area of 2.64 hectares to forty (40) hectares in order to maximize the utilization
of its resources and as a response to the findings of the Preliminary Geohazard Assessment study which
showed that the recession and retreat of the shoreline caused by coastal erosion and scouring should be the
first major concern in the project site and nearby coastal area. The study likewise indicated the vulnerability of
the coastal zone within the proposed project site and the nearby coastal area due to the effects of sea level
rise and climate change which will greatly affect the social, economic, and environmental situation of Caticlan
and nearby Malay coastal communities.34
In his letter dated October 22, 2009 addressed to respondent PRA, Governor Marquez wrote:
With our substantial compliance with the requirements under Administrative Order No. 2007-2 relative to our
request to PRA for approval of the reclamation of the [proposed Beach Zone Restoration and Protection Marine
Development in Barangays Caticlan and Manoc-Manoc] and as a result of our discussion during the [meeting
with the respondent PRA on October 12, 2009], may we respectfully submit a revised Reclamation Project
Description embodying certain revisions/changes in the size and location of the areas to be reclaimed. x x x.
On another note, we are pleased to inform your Office that the bond flotation we have secured with the Local
Government Unit Guarantee Corporation (LGUGC) has been finally approved last October 14, 2009. This will
pave the way for the implementation of said project. Briefly, the Province has been recognized by the Bureau
of Local Government Finance (BLGF) for its capability to meet its loan obligations. x x x.
With the continued increase of tourists coming to Boracay through Caticlan, the Province is venturing into such
development project with the end in view of protection and/or restoring certain segments of the shoreline in
Barangays Caticlan (Caticlan side) and Manoc-manoc (Boracay side) which, as reported by experts, has been
experiencing tremendous coastal erosion.
For the project to be self-liquidating, however, we will be developing the reclaimed land for commercial and
tourism-related facilities and for other complementary uses.35 (Emphasis ours.)
Then, on November 19, 2009, the Sangguniang Panlalawigan enacted Resolution No. 2009-29936 authorizing
Governor Marquez to enter into a Memorandum of Agreement (MOA) with respondent PRA in the
implementation of the Beach Zone Restoration and Protection Marina Development Project, which shall reclaim
a total of 40 hectares in the areas adjacent to the jetty ports at Barangay Caticlan and Barangay Manoc-
manoc. The Sangguniang Panlalawigan approved the terms and conditions of the necessary agreements for
the implementation of the bond flotation of respondent Province to fund the renovation/rehabilitation of the
existing jetty port by way of enhancement and recovery of the Old Caticlan shoreline through reclamation of
an area of 2.64 hectares in the amount of ₱260,000,000.00 on December 1, 2009.37
Respondent Province gave an initial presentation of the project with consultation to the Sangguniang Bayan of
Malay38 on December 9, 2009.
Respondent PRA approved the reclamation project on April 20, 2010 in its Resolution No. 4094 and authorized
its General Manager/Chief Executive Officer (CEO) to enter into a MOA with respondent Province for the
implementation of the reclamation project.39
On April 27, 2010, DENR-EMB RVI issued to respondent Province ECC-R6-1003-096-7100 (the questioned ECC)
for Phase 1 of the Reclamation Project to the extent of 2.64 hectares to be done along the Caticlan side beside
the existing jetty port.40
On May 17, 2010, respondent Province entered into a MOA41 with respondent PRA. Under Article III, the
Project was described therein as follows:
The proposed Aklan Beach Zone Restoration and Protection Marina Development Project involves the
reclamation and development of approximately forty (40) hectares of foreshore and offshore areas of the
Municipality of Malay x x x.
The land use development of the reclamation project shall be for commercial, recreational and institutional and
other applicable uses.42 (Emphases supplied.)
It was at this point that respondent Province deemed it necessary to conduct a series of what it calls
"information-education campaigns," which provided the venue for interaction and dialogue with the public,
particularly the Barangay and Municipal officials of the Municipality of Malay, the residents of Barangay
Caticlan and Boracay, the stakeholders, and the non-governmental organizations (NGOs). The details of the
campaign are summarized as follows43 :
a. June 17, 2010 at Casa Pilar Beach Resort, Boracay Island, Malay, Aklan;44
b. July 28, 2010 at Caticlan Jetty Port and Passenger Terminal;45
c. July 31, 2010 at Barangay Caticlan Plaza;46
d. September 15, 2010 at the Office of the Provincial Governor with Municipal Mayor of Malay – Mayor John P.
Yap;47
e. October 12, 2010 at the Office of the Provincial Governor with the Provincial Development Council Executive
Committee;48 and
f. October 29, 2010 at the Office of the Provincial Governor with Officials of LGU-Malay and Petitioner.49
Petitioner claims that during the "public consultation meeting" belatedly called by respondent Province on June
17, 2010, respondent Province presented the Reclamation Project and only then detailed the actions that it
had already undertaken, particularly: the issuance of the Caticlan Super Marina Bonds; the execution of the
MOA with respondent PRA; the alleged conduct of an Environmental Impact Assessment (EIA) study for the
reclamation project; and the expansion of the project to forty (40) hectares from 2.64 hectares.50
In Resolution No. 046, Series of 2010, adopted on June 23, 2010, the Malay Municipality reiterated its strong
opposition to respondent Province’s project and denied its request for a favorable endorsement of the Marina
Project.51
The Malay Municipality subsequently issued Resolution No. 016, Series of 2010, adopted on August 3, 2010, to
request respondent PRA "not to grant reclamation permit and notice to proceed to the Marina Project of the
[respondent] Provincial Government of Aklan located at Caticlan, Malay, Aklan."52
In a letter53 dated October 12, 2010, petitioner informed respondent PRA of its opposition to the reclamation
project, primarily for the reason that, based on the opinion of Dr. Porfirio M. Aliño, an expert from the
University of the Philippines Marine Science Institute (UPMSI), which he rendered based on the documents
submitted by respondent Province to obtain the ECC, a full EIA study is required to assess the reclamation
project’s likelihood of rendering critical and lasting effect on Boracay considering the proximity in distance,
geographical location, current and wind direction, and many other environmental considerations in the area.
Petitioner noted that said documents had failed to deal with coastal erosion concerns in Boracay. It also noted
that respondent Province failed to comply with certain mandatory provisions of the Local Government Code,
particularly, those requiring the project proponent to conduct consultations with stakeholders.
Petitioner likewise transmitted its Resolution No. 001, Series of 2010, registering its opposition to the
reclamation project to respondent Province, respondent PRA, respondent DENR-EMB, the National Economic
Development Authority Region VI, the Malay Municipality, and other concerned entities.54
Petitioner alleges that despite the Malay Municipality’s denial of respondent Province’s request for a favorable
endorsement, as well as the strong opposition manifested both by Barangay Caticlan and petitioner as an
NGO, respondent Province still continued with the implementation of the Reclamation Project.55
On July 26, 2010, the Sangguniang Panlalawigan of respondent Province set aside Resolution No. 046, s.
2010, of the Municipality of Malay and manifested its support for the implementation of the aforesaid project
through its Resolution No. 2010-022.56
On July 27, 2010, the MOA was confirmed by respondent PRA Board of Directors under its Resolution No.
4130. Respondent PRA wrote to respondent Province on October 19, 2010, informing the latter to proceed
with the reclamation and development of phase 1 of site 1 of its proposed project. Respondent PRA attached
to said letter its Evaluation Report dated October 18, 2010.57
Petitioner likewise received a copy of respondent PRA’s letter dated October 19, 2010, which authorized
respondent Province to proceed with phase 1 of the reclamation project, subject to compliance with the
requirements of its Evaluation Report. The reclamation project was described as:
"[A] seafront development involving reclamation of an aggregate area of more or less, forty (40) hectares in
two (2) separate sites both in Malay Municipality, Aklan Province. Site 1 is in Brgy. Caticlan with a total area of
36.82 hectares and Site 2 in Brgy. Manoc-Manoc, Boracay Island with a total area of 3.18 hectares. Sites 1 and
2 are on the opposite sides of Tabon Strait, about 1,200 meters apart. x x x." 58 (Emphases added.)
The Sangguniang Panlalawigan of Aklan, through Resolution No. 2010-034,59 addressed the apprehensions of
petitioner embodied in its Resolution No. 001, s. 2010, and supported the implementation of the project. Said
resolution stated that the apprehensions of petitioner with regard to the economic, social and political negative
impacts of the projects were mere perceptions and generalities and were not anchored on definite scientific,
social and political studies.
In the meantime, a study was commissioned by the Philippine Chamber of Commerce and Industry-Boracay
(PCCI-Boracay), funded by the Department of Tourism (DOT) with the assistance of, among others, petitioner.
The study was conducted in November 2010 by several marine biologists/experts from the Marine
Environmental Resources Foundation (MERF) of the UPMSI. The study was intended to determine the potential
impact of a reclamation project in the hydrodynamics of the strait and on the coastal erosion patterns in the
southern coast of Boracay Island and along the coast of Caticlan.60
After noting the objections of the respective LGUs of Caticlan and Malay, as well as the apprehensions of
petitioner, respondent Province issued a notice to the contractor on December 1, 2010 to commence with the
construction of the project.61
On April 4, 2011, the Sangguniang Panlalawigan of Aklan, through its Committee on Cooperatives, Food,
Agriculture, and Environmental Protection and the Committee on Tourism, Trade, Industry and Commerce,
conducted a joint committee hearing wherein the study undertaken by the MERF-UPMSI was discussed.62 In
attendance were Mr. Ariel Abriam, President of PCCI-Boracay, representatives from the Provincial Government,
and Dr. Cesar Villanoy, a professor from the UPMSI. Dr. Villanoy said that the subject project, consisting of
2.64 hectares, would only have insignificant effect on the hydrodynamics of the strait traversing the coastline
of Barangay Caticlan and Boracay, hence, there was a distant possibility that it would affect the Boracay
coastline, which includes the famous white-sand beach of the island.63
Thus, on April 6, 2011, the Sangguniang Panlalawigan of Aklan enacted Resolution No. 2011-06564 noting the
report on the survey of the channel between Caticlan and Boracay conducted by the UPMSI in relation to the
effects of the ongoing reclamation to Boracay beaches, and stating that Dr. Villanoy had admitted that
nowhere in their study was it pointed out that there would be an adverse effect on the white-sand beach of
Boracay.
During the First Quarter Regular Meeting of the Regional Development Council, Region VI (RDC-VI) on April
16, 2011, it approved and supported the subject project (covering 2.64 hectares) through RDC-VI Resolution
No. VI-26, series of 2011.65
Subsequently, Mr. Abriam sent a letter to Governor Marquez dated April 25, 2011 stating that the study
conducted by the UPMSI confirms that the water flow across the Caticlan-Boracay channel is primarily tide-
driven, therefore, the marine scientists believe that the 2.64-hectare project of respondent Province would not
significantly affect the flow in the channel and would unlikely impact the Boracay beaches. Based on this,
PCCI-Boracay stated that it was not opposing the 2.64-hectare Caticlan reclamation project on environmental
grounds.66
On June 1, 2011, petitioner filed the instant Petition for Environmental Protection Order/Issuance of the Writ
of Continuing Mandamus. On June 7, 2011, this Court issued a Temporary Environmental Protection Order
(TEPO) and ordered the respondents to file their respective comments to the petition.67
After receiving a copy of the TEPO on June 9, 2011, respondent Province immediately issued an order to the
Provincial Engineering Office and the concerned contractor to cease and desist from conducting any
construction activities until further orders from this Court.
The petition is premised on the following grounds:
I.
The respondent Province, proponent of the reclamation project, failed to comply with relevant rules and
regulations in the acquisition of an ECC.
A. The reclamation project is co-located within environmentally critical areas requiring the performance of a
full, or programmatic, environmental impact assessment.
B. Respondent Province failed to obtain the favorable endorsement of the LGU concerned.
C. Respondent Province failed to conduct the required consultation procedures as required by the Local
Government Code.
D. Respondent Province failed to perform a full environmental impact assessment as required by law and
relevant regulations.
II.
The reclamation of land bordering the strait between Caticlan and Boracay shall adversely affect the frail
ecological balance of the area.68
Petitioner objects to respondent Province’s classification of the reclamation project as single instead of co-
located, as "non-environmentally critical," and as a mere "rehabilitation" of the existing jetty port. Petitioner
points out that the reclamation project is on two sites (which are situated on the opposite sides of Tabon
Strait, about 1,200 meters apart):
36.82 hectares – Site 1, in Bgy. Caticlan
3.18 hectares – Site 2, in Manoc-manoc, Boracay Island69
Phase 1, which was started in December 2010 without the necessary permits,70 is located on the Caticlan side
of a narrow strait separating mainland Aklan from Boracay. In the implementation of the project, respondent
Province obtained only an ECC to conduct Phase 1, instead of an ECC on the entire 40 hectares. Thus,
petitioner argues that respondent Province abused and exploited the Revised Procedural Manual for DENR
Administrative Order No. 30, Series of 2003 (DENR DAO 2003-30)71 relating to the acquisition of an ECC by:
1. Declaring the reclamation project under "Group II Projects-Non-ECP (environmentally critical project) in ECA
(environmentally critical area) based on the type and size of the area," and
2. Failing to declare the reclamation project as a co-located project application which would have required the
Province to submit a Programmatic Environmental Impact Statement (PEIS)72 or Programmatic Environmental
[Performance] Report Management Plan (PE[P]RMP).73 (Emphases ours.)
Petitioner further alleges that the Revised Procedural Manual (on which the classification above is based, which
merely requires an Environmental Impact Statement [EIS] for Group II projects) is patently ultra vires, and
respondent DENR-EMB RVI committed grave abuse of discretion because the laws on EIS, namely, Presidential
Decree Nos. 1151 and 1586, as well as Presidential Proclamation No. 2146, clearly indicate that projects in
environmentally critical areas are to be immediately considered environmentally critical. Petitioner complains
that respondent Province applied for an ECC only for Phase 1; hence, unlawfully
evading the requirement that co-located projects74 within Environmentally Critical Areas (ECAs) must submit a
PEIS and/or a PEPRMP.
Petitioner argues that respondent Province fraudulently classified and misrepresented the project as a Non-
ECP in an ECA, and as a single project instead of a co-located one. The impact assessment allegedly
performed gives a patently erroneous and wrongly-premised appraisal of the possible environmental impact of
the reclamation project. Petitioner contends that respondent Province’s choice of classification was designed to
avoid a comprehensive impact assessment of the reclamation project.
Petitioner further contends that respondent DENR-EMB RVI willfully and deliberately disregarded its duty to
ensure that the environment is protected from harmful developmental projects because it allegedly performed
only a cursory and superficial review of the documents submitted by the respondent Province for an ECC,
failing to note that all the information and data used by respondent Province in its application for the ECC were
all dated and not current, as data was gathered in the late 1990s for the ECC issued in 1999 for the first jetty
port. Thus, petitioner alleges that respondent DENR-EMB RVI ignored the environmental impact to Boracay,
which involves changes in the structure of the coastline that could contribute to the changes in the
characteristics of the sand in the beaches of both Caticlan and Boracay.
Petitioner insists that reclamation of land at the Caticlan side will unavoidably adversely affect the Boracay side
and notes that the declared objective of the reclamation project is for the exploitation of Boracay’s tourist
trade, since the project is intended to enhance support services thereto. But, petitioner argues, the primary
reason for Boracay’s popularity is its white-sand beaches which will be negatively affected by the project.
Petitioner alleges that respondent PRA had required respondent Province to obtain the favorable endorsement
of the LGUs of Barangay Caticlan and Malay Municipality pursuant to the consultation procedures as required
by the Local Government Code.75 Petitioner asserts that the reclamation project is in violation not only of laws
on EIS but also of the Local Government Code as respondent Province failed to enter into proper consultations
with the concerned LGUs. In fact, the Liga ng mga Barangay-Malay Chapter also expressed strong opposition
against the project.76
Petitioner cites Sections 26 and 27 of the Local Government Code, which require consultations if the project or
program may cause pollution, climactic change, depletion of non-renewable resources, etc. According to
petitioner, respondent Province ignored the LGUs’ opposition expressed as early as 2008. Not only that,
respondent Province belatedly called for public "consultation meetings" on June 17 and July 28, 2010, after an
ECC had already been issued and the MOA between respondents PRA and Province had already been
executed. As the petitioner saw it, these were not consultations but mere "project presentations."
Petitioner claims that respondent Province, aided and abetted by respondents PRA and DENR-EMB, ignored
the spirit and letter of the Revised Procedural Manual, intended to implement the various regulations
governing the Environmental Impact Assessments (EIAs) to ensure that developmental projects are in line with
sustainable development of natural resources. The project was conceptualized without considering
alternatives.
Further, as to its allegation that respondent Province failed to perform a full EIA, petitioner argues that while it
is true that as of now, only the Caticlan side has been issued an ECC, the entire project involves the Boracay
side, which should have been considered a co-located project. Petitioner claims that any project involving
Boracay requires a full EIA since it is an ECA. Phase 1 of the project will affect Boracay and Caticlan as they
are separated only by a narrow strait; thus, it should be considered an ECP. Therefore, the ECC and permit
issued must be invalidated and cancelled.
Petitioner contends that a study shows that the flow of the water through a narrower channel due to the
reclamation project will likely divert sand transport off the southwest part of Boracay, whereas the
characteristic coast of the Caticlan side of the strait indicate stronger sediment transport.77 The white-sand
beaches of Boracay and its surrounding marine environment depend upon the natural flow of the adjacent
waters.
Regarding its claim that the reclamation of land bordering the strait between Caticlan and Boracay shall
adversely affect the frail ecological balance of the area, petitioner submits that while the study conducted by
the MERF-UPMSI only considers the impact of the reclamation project on the land, it is undeniable that it will
also adversely affect the already frail ecological balance of the area. The effect of the project would have been
properly assessed if the proper EIA had been performed prior to any implementation of the project.
According to petitioner, respondent Province’s intended purposes do not prevail over its duty and obligation to
protect the environment. Petitioner believes that rehabilitation of the Jetty Port may be done through other
means.
In its Comment78 dated June 21, 2011, respondent Province claimed that application for reclamation of 40
hectares is advantageous to the Provincial Government considering that its filing fee would only cost
Php20,000.00 plus Value Added Tax (VAT) which is also the minimum fee as prescribed under Section 4.2 of
Administrative Order No. 2007-2.79
Respondent Province considers the instant petition to be premature; thus, it must necessarily fail for lack of
cause of action due to the failure of petitioner to fully exhaust the available administrative remedies even
before seeking judicial relief. According to respondent Province, the petition primarily assailed the decision of
respondent DENR-EMB RVI in granting the ECC for the subject project consisting of 2.64 hectares and sought
the cancellation of the ECC for alleged failure of respondent Province to submit proper documentation as
required for its issuance. Hence, the grounds relied upon by petitioner can be addressed within the confines of
administrative processes provided by law.
Respondent Province believes that under Section 5.4.3 of DENR Administrative Order No. 2003-30 (DAO 2003-
30),80 the issuance of an ECC81 is an official decision of DENR-EMB RVI on the application of a project
proponent.82 It cites Section 6 of DENR DAO 2003-30, which provides for a remedy available to the party
aggrieved by the final decision on the proponent’s ECC applications.
Respondent Province argues that the instant petition is anchored on a wrong premise that results to
petitioner’s unfounded fears and baseless apprehensions. It is respondent Province’s contention that its 2.64-
hectare reclamation project is considered as a "stand alone project," separate and independent from the
approved area of 40 hectares. Thus, petitioner should have observed the difference between the "future
development plan" of respondent Province from its "actual project" being undertaken.83
Respondent Province clearly does not dispute the fact that it revised its original application to respondent PRA
from 2.64 hectares to 40 hectares. However, it claims that such revision is part of its future plan, and
implementation thereof is "still subject to availability of funds, independent scientific environmental study,
separate application of ECC and notice to proceed to be issued by respondent PRA."84
Respondent Province goes on to claim that "[p]etitioner’s version of the Caticlan jetty port expansion project is
a bigger project which is still at the conceptualization stage. Although this project was described in the Notice
to Proceed issued by respondent PRA to have two phases, 36.82 hectares in Caticlan and 3.18 hectares in
Boracay [Island,] it is totally different from the [ongoing] Caticlan jetty port expansion project."85
Respondent Province says that the Accomplishment Report86 of its Engineering Office would attest that the
actual project consists of 2.64 hectares only, as originally planned and conceptualized, which was even
reduced to 2.2 hectares due to some construction and design modifications.
Thus, respondent Province alleges that from its standpoint, its capability to reclaim is limited to 2.64 hectares
only, based on respondent PRA’s Evaluation Report87 dated October 18, 2010, which was in turn the basis of
the issuance of the Notice to Proceed dated October 19, 2010, because the project’s financial component is
₱260,000,000.00 only. Said Evaluation Report indicates that the implementation of the other phases of the
project including site 2, which consists of the other portions of the 40-hectare area that includes a portion in
Boracay, is still within the 10-year period and will depend largely on the availability of funds of respondent
Province.88
So, even if respondent PRA approved an area that would total up to 40 hectares, it was divided into phases in
order to determine the period of its implementation. Each phase was separate and independent because the
source of funds was also separate. The required documents and requirements were also specific for each
phase. The entire approved area of 40 hectares could be implemented within a period of 10 years but this
would depend solely on the availability of funds.89
As far as respondent Province understands it, additional reclamations not covered by the ECC, which only
approved 2.64 hectares, should undergo another EIA. If respondent Province intends to commence the
construction on the other component of the 40 hectares, then it agrees that it is mandated to secure a new
ECC.90
Respondent Province admits that it dreamt of a 40-hectare project, even if it had originally planned and was at
present only financially equipped and legally compliant to undertake 2.64 hectares of the project, and only as
an expansion of its old jetty port.91
Respondent Province claims that it has complied with all the necessary requirements for securing an ECC. On
the issue that the reclamation project is within an ECA requiring the performance of a full or programmatic
EIA, respondent Province reiterates that the idea of expanding the area to 40 hectares is only a future plan. It
only secured an ECC for 2.64 hectares, based on the limits of its funding and authority. From the beginning, its
intention was to rehabilitate and expand the existing jetty port terminal to accommodate an increasing
projected traffic. The subject project is specifically classified under DENR DAO 2003-30 on its Project Grouping
Matrix for Determination of EIA Report Type considered as Minor Reclamation Projects falling under Group II –
Non ECP in an ECA. Whether 2.64 or 40 hectares in area, the subject project falls within this classification.
Consequently, respondent Province claims that petitioner erred in considering the ongoing reclamation project
at Caticlan, Malay, Aklan, as co-located within an ECA.
Respondent Province, likewise argues that the 2.64-hectare project is not a component of the approved 40-
hectare area as it is originally planned for the expansion site of the existing Caticlan jetty port. At present, it
has no definite conceptual construction plan of the said portion in Boracay and it has no financial allocation to
initiate any project on the said Boracay portion.
Furthermore, respondent Province contends that the present project is located in Caticlan while the alleged
component that falls within an ECA is in Boracay. Considering its geographical location, the two sites cannot be
considered as a contiguous area for the reason that it is separated by a body of water – a strait that traverses
between the mainland Panay wherein Caticlan is located and Boracay. Hence, it is erroneous to consider the
two sites as a co-located project within an ECA. Being a "stand alone project" and an expansion of the existing
jetty port, respondent DENR-EMB RVI had required respondent Province to perform an EPRMP to secure an
ECC as sanctioned by Item No. 8(b), page 7 of DENR DAO 2003-30.
Respondent Province contends that even if, granting for the sake of argument, it had erroneously categorized
its project as Non-ECP in an ECA, this was not a final determination. Respondent DENR-EMB RVI, which was
the administrator of the EIS system, had the final decision on this matter. Under DENR DAO 2003-30, an
application for ECC, even for a Category B2 project where an EPRMP is conducted, shall be subjected to a
review process. Respondent DENR-EMB RVI had the authority to deny said application. Its Regional Director
could either issue an ECC for the project or deny the application. He may also require a more comprehensive
EIA study. The Regional Director issued the ECC based on the EPRMP submitted by respondent Province and
after the same went through the EIA review process.
Thus, respondent Province concludes that petitioner’s allegation of this being a "co-located project" is
premature if not baseless as the bigger reclamation project is still on the conceptualization stage. Both
respondents PRA and Province are yet to complete studies and feasibility studies to embark on another
project.
Respondent Province claims that an ocular survey of the reclamation project revealed that it had worked
within the limits of the ECC.92
With regard to petitioner’s allegation that respondent Province failed to get the favorable endorsement of the
concerned LGUs in violation of the Local Government Code, respondent Province contends that consultation
vis-à-vis the favorable endorsement from the concerned LGUs as contemplated under the Local Government
Code are merely tools to seek advice and not a power clothed upon the LGUs to unilaterally approve or
disapprove any government projects. Furthermore, such endorsement is not necessary for projects falling
under Category B2 unless required by the DENR-EMB RVI, under Section 5.3 of DENR DAO 2003-30.
Moreover, DENR Memorandum Circular No. 08-2007 no longer requires the issuance of permits and
certifications as a pre-requisite for the issuance of an ECC. Respondent Province claims to have conducted
consultative activities with LGUs in connection with Sections 26 and 27 of the Local Government Code. The
vehement and staunch objections of both the Sangguniang Barangay of Caticlan and the Sangguniang Bayan
of Malay, according to respondent Province, were not rooted on its perceived impact upon the people and the
community in terms of environmental or ecological balance, but due to an alleged conflict with their "principal
position to develop, utilize and reap benefits from the natural resources found within its jurisdiction."93
Respondent Province argues that these concerns are not within the purview of the Local Government Code.
Furthermore, the Preliminary Geohazard Assessment Report and EPRMP as well as Sangguniang Panlalawigan
Resolution Nos. 2010-022 and 2010-034 should address any environmental issue they may raise.
Respondent Province posits that the spirit and intent of Sections 26 and 27 of the Local Government Code is to
create an avenue for parties, the proponent and the LGU concerned, to come up with a tool in harmonizing its
views and concerns about the project. The duty to consult does not automatically require adherence to the
opinions during the consultation process. It is allegedly not within the provisions to give the full authority to
the LGU concerned to unilaterally approve or disapprove the project in the guise of requiring the proponent of
securing its favorable endorsement. In this case, petitioner is calling a halt to the project without providing an
alternative resolution to harmonize its position and that of respondent Province.
Respondent Province claims that the EPRMP94 would reveal that:
[T]he area fronting the project site is practically composed of sand. Dead coral communities may be found
along the vicinity. Thus, fish life at the project site is quite scarce due to the absence of marine support
systems like the sea grass beds and coral reefs.
x x x [T]here is no coral cover at the existing Caticlan jetty port. [From] the deepest point of jetty to the
shallowest point, there was no more coral patch and the substrate is sandy. It is of public knowledge that the
said foreshore area is being utilized by the residents ever since as berthing or anchorage site of their
motorized banca. There will be no possibility of any coral development therein because of its continuous
utilization. Likewise, the activity of the strait that traverses between the main land Caticlan and Boracay Island
would also be a factor of the coral development. Corals [may] only be formed within the area if there is
scientific human intervention, which is absent up to the present.
In light of the foregoing premise, it casts serious doubt on petitioner’s allegations pertaining to the
environmental effects of Respondent-LGU’s 2.64 hectares reclamation project. The alleged environmental
impact of the subject project to the beaches of Boracay Island remains unconfirmed. Petitioner had
unsuccessfully proven that the project would cause imminent, grave and irreparable injury to the
community.95
Respondent Province prayed for the dissolution of the TEPO, claiming that the rules provide that the TEPO
may be dissolved if it appears after hearing that its issuance or continuance would cause irreparable damage
to the party or person enjoined, while the applicant may be fully compensated for such damages as he may
suffer and subject to the posting of a sufficient bond by the party or person enjoined. Respondent Province
contends that the TEPO would cause irreparable damage in two aspects:
a. Financial dislocation and probable bankruptcy; and
b. Grave and imminent danger to safety and health of inhabitants of immediate area, including tourists and
passengers serviced by the jetty port, brought about by the abrupt cessation of development works.
As regards financial dislocation, the arguments of respondent Province are summarized below:
1. This project is financed by bonds which the respondent Province had issued to its creditors as the financing
scheme in funding the present project is by way of credit financing through bond flotation.
2. The funds are financed by a Guarantee Bank – getting payment from bonds, being sold to investors, which
in turn would be paid by the income that the project would realize or incur upon its completion.
3. While the project is under construction, respondent Province is appropriating a portion of its Internal
Revenue Allotment (IRA) budget from the 20% development fund to defray the interest and principal
amortization due to the Guarantee Bank.
4. The respondent Province’s IRA, regular income, and/or such other revenues or funds, as may be permitted
by law, are being used as security for the payment of the said loan used for the project’s construction.
5. The inability of the subject project to earn revenues as projected upon completion will compel the Province
to shoulder the full amount of the obligation, starting from year 2012.
6. Respondent province is mandated to assign its IRA, regular income and/or such other revenues or funds as
permitted by law; if project is stopped, detriment of the public welfare and its constituents.96
As to the second ground for the dissolution of the TEPO, respondent Province argues:
1. Non-compliance with the guidelines of the ECC may result to environmental hazards most especially that
reclaimed land if not properly secured may be eroded into the sea.
2. The construction has accomplished 65.26 percent of the project. The embankment that was deposited on
the project has no proper concrete wave protection that might be washed out in the event that a strong
typhoon or big waves may occur affecting the strait and the properties along the project site. It is already the
rainy season and there is a big possibility of typhoon occurrence.
3. If said incident occurs, the aggregates of the embankment that had been washed out might be transferred
to the adjoining properties which could affect its natural environmental state.
4. It might result to the total alteration of the physical landscape of the area attributing to environmental
disturbance.
5. The lack of proper concrete wave protection or revetment would cause the total erosion of the embankment
that has been dumped on the accomplished area.97
Respondent Province claims that petitioner will not stand to suffer immediate, grave and irreparable injury or
damage from the ongoing project. The petitioner’s perceived fear of environmental destruction brought about
by its erroneous appreciation of available data is unfounded and does not translate into a matter of extreme
urgency. Thus, under the Rules of Procedure on Environmental Cases, the TEPO may be dissolved.
Respondent PRA filed its Comment98 on June 22, 2011. It alleges that on June 24, 2006, Executive Order No.
543 delegated the power "to approve reclamation projects to respondent PRA through its governing Board,
subject to compliance with existing laws and rules and further subject to the condition that reclamation
contracts to be executed with any person or entity (must) go through public bidding."
Section 4 of respondent PRA’s Administrative Order No. 2007-2 provides for the approval process and
procedures for various reclamation projects to be undertaken. Respondent PRA prepared an Evaluation Report
on November 5, 200999 regarding Aklan’s proposal to increase its project to 40 hectares.
Respondent PRA contends that it was only after respondent Province had complied with the requirements
under the law that respondent PRA, through its Board of Directors, approved the proposed project under its
Board Resolution No. 4094.100 In the same Resolution, respondent PRA Board authorized the General
Manager/CEO to execute a MOA with the Aklan provincial government to implement the reclamation project
under certain conditions.
The issue for respondent PRA was whether or not it approved the respondent Province’s 2.64-hectare
reclamation project proposal in willful disregard of alleged "numerous irregularities" as claimed by
petitioner.101
Respondent PRA claims that its approval of the Aklan Reclamation Project was in accordance with law and its
rules. Indeed, it issued the notice to proceed only after Aklan had complied with all the requirements imposed
by existing laws and regulations. It further contends that the 40 hectares involved in this project remains a
plan insofar as respondent PRA is concerned. What has been approved for reclamation by respondent PRA
thus far is only the 2.64-hectare reclamation project. Respondent PRA reiterates that it approved this
reclamation project after extensively reviewing the legal, technical, financial, environmental, and operational
aspects of the proposed reclamation.102
One of the conditions that respondent PRA Board imposed before approving the Aklan project was that no
reclamation work could be started until respondent PRA has approved the detailed engineering
plans/methodology, design and specifications of the reclamation. Part of the required submissions to
respondent PRA includes the drainage design as approved by the Public Works Department and the ECC as
issued by the DENR, all of which the Aklan government must submit to respondent PRA before starting any
reclamation works.103 Under Article IV(B)(3) of the MOA between respondent PRA and Aklan, the latter is
required to submit, apart from the ECC, the following requirements for respondent PRA’s review and approval,
as basis for the issuance of a Notice to Proceed (NTP) for Reclamation Works:
(a) Land-form plan with technical description of the metes and bounds of the same land-form;
(b) Final master development and land use plan for the project;
(c) Detailed engineering studies, detailed engineering design, plans and specification for reclamation works,
reclamation plans and methodology, plans for the sources of fill materials;
(d) Drainage plan vis-a-vis the land-form approved by DPWH Regional Office to include a cost effective and
efficient drainage system as may be required based on the results of the studies;
(e) Detailed project cost estimates and quantity take-off per items of work of the rawland reclamation
components, e.g. reclamation containment structures and soil consolidation;
(f) Organizational chart of the construction arm, manning table, equipment schedule for the project; and,
(g) Project timetable (PERT/CPM) for the entire project construction period.104
In fact, respondent PRA further required respondent Province under Article IV (B)(24) of the MOA to strictly
comply with all conditions of the DENR-EMB-issued ECC "and/or comply with pertinent local and international
commitments of the Republic of the Philippines to ensure environmental protection."105
In its August 11, 2010 letter,106 respondent PRA referred for respondent Province’s appropriate action
petitioner’s Resolution 001, series of 2010 and Resolution 46, series of 2010, of the Sangguniang Bayan of
Malay. Governor Marquez wrote respondent PRA107 on September 16, 2010 informing it that respondent
Province had already met with the different officials of Malay, furnishing respondent PRA with the copies of the
minutes of such meetings/presentations. Governor Marquez also assured respondent PRA that it had complied
with the consultation requirements as far as Malay was concerned.
Respondent PRA claims that in evaluating respondent Province’s project and in issuing the necessary NTP for
Phase 1 of Site 1 (2.64 hectares) of the Caticlan Jetty Port expansion and modernization, respondent PRA gave
considerable weight to all pertinent issuances, especially the ECC issued by DENR-EMB RVI.108 Respondent
PRA stresses that its earlier approval of the 40-hectare reclamation project under its Resolution No. 4094,
series of 2010, still requires a second level of compliance requirements from the proponent. Respondent
Province could not possibly begin its reclamation works since respondent PRA had yet to issue an NTP in its
favor.
Respondent PRA alleges that prior to the issuance of the NTP to respondent Province for Phase 1 of Site 1, it
required the submission of the following pre-construction documents:
(a) Land-Form Plan (with technical description);
(b) Site Development Plan/Land Use Plan including,
(i) sewer and drainage systems and
(ii) waste water treatment;
(c) Engineering Studies and Engineering Design;
(d) Reclamation Methodology;
(e) Sources of Fill Materials, and,
(f) The ECC.109
Respondent PRA claims that it was only after the evaluation of the above submissions that it issued to
respondent Province the NTP, limited to the 2.64-hectare reclamation project. Respondent PRA even
emphasized in its evaluation report that should respondent Province pursue the other phases of its project, it
would still require the submission of an ECC for each succeeding phases before the start of any reclamation
works.110
Respondent PRA, being the national government’s arm in regulating and coordinating all reclamation projects
in the Philippines – a mandate conferred by law – manifests that it is incumbent upon it, in the exercise of its
regulatory functions, to diligently evaluate, based on its technical competencies, all reclamation projects
submitted to it for approval. Once the reclamation project’s requirements set forth by law and related rules
have been complied with, respondent PRA is mandated to approve the same. Respondent PRA claims, "[w]ith
all the foregoing rigorous and detailed requirements submitted and complied with by Aklan, and the attendant
careful and meticulous technical and legal evaluation by respondent PRA, it cannot be argued that the
reclamation permit it issued to Aklan is ‘founded upon numerous irregularities;’ as recklessly and baselessly
imputed by BFI."111
In its Comment112 dated July 1, 2011, respondent DENR-EMB RVI asserts that its act of issuing the ECC
certifies that the project had undergone the proper EIA process by assessing, among others, the direct and
indirect impact of the project on the biophysical and human environment and ensuring that these impacts are
addressed by appropriate environmental protection and enhancement measures, pursuant to Presidential
Decree No. 1586, the Revised Procedural Manual for DENR DAO 2003-30, and the existing rules and
regulations.113
Respondent DENR-EMB RVI stresses that the declaration in 1978 of several islands, which includes Boracay as
tourist zone and marine reserve under Proclamation No. 1801, has no relevance to the expansion project of
Caticlan Jetty Port and Passenger Terminal for the very reason that the project is not located in the Island of
Boracay, being located in Barangay Caticlan, Malay, which is not a part of mainland Panay. It admits that the
site of the subject jetty port falls within the ECA under Proclamation No. 2146 (1981), being within the
category of a water body. This was why respondent Province had faithfully secured an ECC pursuant to the
Revised Procedural Manual for DENR DAO 2003-30 by submitting the necessary documents as contained in the
EPRMP on March 19, 2010, which were the bases in granting ECC No. R6-1003-096-7100 (amended) on April
27, 2010 for the expansion of Caticlan Jetty Port and Passenger Terminal, covering 2.64 hectares.114
Respondent DENR-EMB RVI claims that the issues raised by the LGUs of Caticlan and Malay had been
considered by the DENR-Provincial Environment and Natural Resources Office (PENRO), Aklan in the issuance
of the Order115 dated January 26, 2010, disregarding the claim of the Municipality of Malay, Aklan of a portion
of the foreshore land in Caticlan covered by the application of the Province of Aklan; and another Order of
Rejection dated February 5, 2010 of the two foreshore applications, namely FLA No. 060412-43A and FLA No.
060412-43B, of the Province of Aklan.116
Respondent DENR-EMB RVI contends that the supporting documents attached to the EPRMP for the issuance
of an ECC were merely for the expansion and modernization of the old jetty port in Barangay Caticlan covering
2.64 hectares, and not the 40-hectare reclamation project in Barangay Caticlan and Boracay. The previous
letter of respondent Province dated October 14, 2009 addressed to DENR-EMB RVI Regional Executive
Director, would show that the reclamation project will cover approximately 2.6 hectares.117 This application
for ECC was not officially accepted due to lack of requirements or documents.
Although petitioner insists that the project involves 40 hectares in two sites, respondent DENR-EMB RVI looked
at the documents submitted by respondent Province and saw that the subject area covered by the ECC
application and subsequently granted with ECC-R6-1003-096-7100 consists only of 2.64 hectares; hence,
respondent DENR-EMB RVI could not comment on the excess area.118
Respondent DENR-EMB RVI admits that as regards the classification of the 2.64-hectare reclamation project
under "Non ECP in ECA," this does not fall within the definition of a co-located project because the subject
project is merely an expansion of the old Caticlan Jetty Port, which had a previously issued ECC (ECC No.
0699-1012-171 on October 12, 1999). Thus, only an EPRMP, not a PEIS or PEPRMP, is required.119
Respondent Province submitted to respondent DENR-EMB RVI the following documents contained in the
EPRMP:
a. The Observations on the Floor Bottom and its Marine Resources at the Proposed Jetty Ports at Caticlan and
Manok-manok, Boracay, Aklan, conducted in 1999 by the Bureau of Fisheries Aquatic Resources (BFAR)
Central Office, particularly in Caticlan site, and
b. The Study conducted by Dr. Ricarte S. Javelosa, Ph. D, Mines and Geosciences Bureau (MGB), Central Office
and Engr. Roger Esto, Provincial Planning and Development Office (PPDO), Aklan in 2009 entitled "Preliminary
Geo-hazard Assessment for the Enhancement of the Existing Caticlan Jetty Port Terminal through Beach Zone
Restoration and Protective Marina Development in Malay, Aklan."
Respondent DENR-EMB RVI claims that the above two scientific studies were enough for it to arrive at a best
professional judgment to issue an amended ECC for the Aklan Marina Project covering 2.64 hectares.120
Furthermore, to confirm that the 2.64-hectare reclamation has no significant negative impact with the
surrounding environment particularly in Boracay, a more recent study was conducted, and respondent DENR-
EMB RVI alleges that "[i]t is very important to highlight that the input data in the [MERF- UPMSI] study utilized
the [40-hectare] reclamation and [200-meter] width seaward using the tidal and wave modelling."121 The
study showed that the reclamation of 2.64 hectares had no effect to the hydrodynamics of the strait between
Barangay Caticlan and Boracay.
Respondent DENR-EMB RVI affirms that no permits and/or clearances from National Government Agencies
(NGAs) and LGUs are required pursuant to the DENR Memorandum Circular No. 2007-08, entitled "Simplifying
the Requirements of ECC or CNC Applications;" that the EPRMP was evaluated and processed based on the
Revised Procedural Manual for DENR DAO 2003-30 which resulted to the issuance of ECC-R6-1003-096-7100;
and that the ECC is not a permit per se but a planning tool for LGUs to consider in its decision whether or not
to issue a local permit.122
Respondent DENR-EMB RVI concludes that in filing this case, petitioner had bypassed and deprived the DENR
Secretary of the opportunity to review and/or reverse the decision of his subordinate office, EMB RVI pursuant
to the Revised Procedural Manual for DENR DAO 2003-30. There is no "extreme urgency that necessitates the
granting of Mandamus or issuance of TEPO that put to balance between the life and death of the petitioner or
present grave or irreparable damage to environment."123
After receiving the above Comments from all the respondents, the Court set the case for oral arguments on
September 13, 2011.
Meanwhile, on September 8, 2011, respondent Province filed a Manifestation and Motion124 praying for the
dismissal of the petition, as the province was no longer pursuing the implementation of the succeeding phases
of the project due to its inability to comply with Article IV B.2(3) of the MOA; hence, the issues and fears
expressed by petitioner had become moot. Respondent Province alleges that the petition is "premised on a
serious misappreciation of the real extent of the contested reclamation project" as certainly the ECC covered
only a total of 2,691 square meters located in Barangay Caticlan, Malay, Aklan; and although the MOA spoke
of 40 hectares, respondent Province’s submission of documents to respondent PRA pertaining to said area was
but the first of a two-step process of approval. Respondent Province claims that its failure to comply with the
documentary requirements of respondent PRA within the period provided, or 120 working days from the
effectivity of the MOA, indicated its waiver to pursue the remainder of the project.125 Respondent Province
further manifested:
Confirming this in a letter dated 12 August 2011,126 Governor Marquez informed respondent PRA that the
Province of Aklan is no longer "pursuing the implementation of the succeeding phases of the project with a
total area of 37.4 hectares for our inability to comply with Article IV B.2 (3) of the MOA; hence, the existing
MOA will cover only the project area of 2.64 hectares."
In his reply-letter dated August 22, 2011,127 [respondent] PRA General Manager informed Governor Marquez
that the [respondent] PRA Board of Directors has given [respondent] PRA the authority to confirm the position
of the Province of Aklan that the "Aklan Beach Zone Restoration and Protection Marine Development Project
will now be confined to the reclamation and development of the 2.64 hectares, more or less.
It is undisputed from the start that the coverage of the Project is in fact limited to 2.64 hectares, as evidenced
by the NTP issued by respondent PRA. The recent exchange of correspondence between respondents Province
of Aklan and [respondent] PRA further confirms the intent of the parties all along. Hence, the Project subject
of the petition, without doubt, covers only 2.64 and not 40 hectares as feared. This completely changes the
extent of the Project and, consequently, moots the issues and fears expressed by the petitioner.128 (Emphasis
supplied.)
Based on the above contentions, respondent Province prays that the petition be dismissed as no further
justiciable controversy exists since the feared adverse effect to Boracay Island’s ecology had become academic
all together.129
The Court heard the parties’ oral arguments on September 13, 2011 and gave the latter twenty (20) days
thereafter to file their respective memoranda.
Respondent Province filed another Manifestation and Motion,130 which the Court received on April 2, 2012
stating that:
1. it had submitted the required documents and studies to respondent DENR-EMB RVI before an ECC was
issued in its favor;
2. it had substantially complied with the requirements provided under PRA Administrative Order 2007-2, which
compliance caused respondent PRA’s Board to approve the reclamation project; and
3. it had conducted a series of "consultative [presentations]" relative to the reclamation project before the LGU
of Malay Municipality, the Barangay Officials of Caticlan, and stakeholders of Boracay Island.
Respondent Province further manifested that the Barangay Council of Caticlan, Malay, Aklan enacted on
February 13, 2012 Resolution No. 003, series of 2012, entitled "Resolution Favorably Endorsing the 2.6
Hectares Reclamation/MARINA Project of the Aklan Provincial Government at Caticlan Coastline"131 and that
the Sangguniang Bayan of the Municipality of Malay, Aklan enacted Resolution No. 020, series of 2012,
entitled "Resolution Endorsing the 2.6 Hectares Reclamation Project of the Provincial Government of Aklan
Located at Barangay Caticlan, Malay, Aklan."132
Respondent Province claims that its compliance with the requirements of respondents DENR-EMB RVI and PRA
that led to the approval of the reclamation project by the said government agencies, as well as the recent
enactments of the Barangay Council of Caticlan and the Sangguniang Bayan of the Municipality of Malay
favorably endorsing the said project, had "categorically addressed all the issues raised by the Petitioner in its
Petition dated June 1, 2011." Respondent Province prays as follows:
WHEREFORE, premises considered, it is most respectfully prayed of this Honorable Court that after due
proceedings, the following be rendered:
1. The Temporary Environmental Protection Order (TEPO) it issued on June 7, 2011 be lifted/dissolved.
2. The instant petition be dismissed for being moot and academic.
3. Respondent Province of Aklan prays for such other reliefs that are just and equitable under the premises.
(Emphases in the original.)
ISSUES
The Court will now resolve the following issues:
I. Whether or not the petition should be dismissed for having been rendered moot and academic
II. Whether or not the petition is premature because petitioner failed to exhaust administrative remedies
before filing this case
III. Whether or not respondent Province failed to perform a full EIA as required by laws and regulations based
on the scope and classification of the project
IV. Whether or not respondent Province complied with all the requirements under the pertinent laws and
regulations
V. Whether or not there was proper, timely, and sufficient public consultation for the project
DISCUSSION
On the issue of whether or not the Petition should be dismissed for having been rendered moot and academic
Respondent Province claims in its Manifestation and Motion filed on April 2, 2012 that with the alleged
favorable endorsement of the reclamation project by the Sangguniang Barangay of Caticlan and the
Sangguniang Bayan of the Municipality of Malay, all the issues raised by petitioner had already been
addressed, and this petition should be dismissed for being moot and academic.
On the contrary, a close reading of the two LGUs’ respective resolutions would reveal that they are not
sufficient to render the petition moot and academic, as there are explicit conditions imposed that must be
complied with by respondent Province. In Resolution No. 003, series of 2012, of the Sangguniang Barangay of
Caticlan it is stated that "any vertical structures to be constructed shall be subject for barangay
endorsement."133 Clearly, what the barangay endorsed was the reclamation only, and not the entire project
that includes the construction of a commercial building and wellness center, and other tourism-related
facilities. Petitioner’s objections, as may be recalled, pertain not only to the reclamation per se, but also to the
building to be constructed and the entire project’s perceived ill effects to the surrounding environment.
Resolution No. 020, series of 2012, of the Sangguniang Bayan of Malay134 is even more specific. It reads in
part:
WHEREAS, noble it seems the reclamation project to the effect that it will generate scores of benefits for the
Local Government of Malay in terms of income and employment for its constituents, but the fact cannot be
denied that the project will take its toll on the environment especially on the nearby fragile island of Boracay
and the fact also remains that the project will eventually displace the local transportation
operators/cooperatives;
WHEREAS, considering the sensitivity of the project, this Honorable Body through the Committee where this
matter was referred conducted several consultations/committee hearings with concerned departments and the
private sector specifically Boracay Foundation, Inc. and they are one in its belief that this Local Government
Unit has never been against development so long as compliance with the law and proper procedures have
been observed and that paramount consideration have been given to the environment lest we disturb the
balance of nature to the end that progress will be brought to naught;
WHEREAS, time and again, to ensure a healthy intergovernmental relations, this August Body requires no less
than transparency and faithful commitment from the Provincial Government of Aklan in the process of going
through these improvements in the Municipality because it once fell prey to infidelities in matters of
governance;
WHEREAS, as a condition for the grant of this endorsement and to address all issues and concerns, this
Honorable Council necessitates a sincere commitment from the Provincial Government of Aklan to the end
that:
1. To allocate an office space to LGU-Malay within the building in the reclaimed area;
2. To convene the Cagban and Caticlan Jetty Port Management Board before the resumption of the
reclamation project;
3. That the reclamation project shall be limited only to 2.6 hectares in Barangay Caticlan and not beyond;
4. That the local transportation operators/cooperatives will not be displaced; and
5. The Provincial Government of Aklan conduct a simultaneous comprehensive study on the environmental
impact of the reclamation project especially during Habagat and Amihan seasons and put in place as early as
possible mitigating measures on the effect of the project to the environment.
WHEREAS, having presented these stipulations, failure to comply herewith will leave this August Body no
choice but to revoke this endorsement, hence faithful compliance of the commitment of the Provincial
Government is highly appealed for[.]135 (Emphases added.)
The Sangguniang Bayan of Malay obviously imposed explicit conditions for respondent Province to comply with
on pain of revocation of its endorsement of the project, including the need to conduct a comprehensive study
on the environmental impact of the reclamation project, which is the heart of the petition before us.
Therefore, the contents of the two resolutions submitted by respondent Province do not support its conclusion
that the subsequent favorable endorsement of the LGUs had already addressed all the issues raised and
rendered the instant petition moot and academic.
On the issue of failure to exhaust administrative remedies
Respondents, in essence, argue that the present petition should be dismissed for petitioner’s failure to exhaust
administrative remedies and even to observe the hierarchy of courts. Furthermore, as the petition questions
the issuance of the ECC and the NTP, this involves factual and technical verification, which are more properly
within the expertise of the concerned government agencies.
Respondents anchor their argument on Section 6, Article II of DENR DAO 2003-30, which provides:
Section 6. Appeal
Any party aggrieved by the final decision on the ECC / CNC applications may, within 15 days from receipt of
such decision, file an appeal on the following grounds:
a. Grave abuse of discretion on the part of the deciding authority, or
b. Serious errors in the review findings.
The DENR may adopt alternative conflict/dispute resolution procedures as a means to settle grievances
between proponents and aggrieved parties to avert unnecessary legal action. Frivolous appeals shall not be
countenanced.
The proponent or any stakeholder may file an appeal to the following:
Deciding Authority
Where to file the appeal
EMB Regional Office Director
Office of the EMB Director
EMB Central Office Director
Office of the DENR Secretary
DENR Secretary
Office of the President
(Emphases supplied.)
Respondents argue that since there is an administrative appeal provided for, then petitioner is duty bound to
observe the same and may not be granted recourse to the regular courts for its failure to do so.
We do not agree with respondents’ appreciation of the applicability of the rule on exhaustion of administrative
remedies in this case. We are reminded of our ruling in Pagara v. Court of Appeals,136 which summarized our
earlier decisions on the procedural requirement of exhaustion of administrative remedies, to wit:
The rule regarding exhaustion of administrative remedies is not a hard and fast rule. It is not applicable (1)
where the question in dispute is purely a legal one, or (2) where the controverted act is patently illegal or was
performed without jurisdiction or in excess of jurisdiction; or (3) where the respondent is a department
secretary, whose acts as an alter ego of the President bear the implied or assumed approval of the latter,
unless actually disapproved by him, or (4) where there are circumstances indicating the urgency of judicial
intervention, - Gonzales vs. Hechanova, L-21897, October 22, 1963, 9 SCRA 230; Abaya vs. Villegas, L-25641,
December 17, 1966, 18 SCRA; Mitra vs. Subido, L-21691, September 15, 1967, 21 SCRA 127.
Said principle may also be disregarded when it does not provide a plain, speedy and adequate remedy,
(Cipriano vs. Marcelino, 43 SCRA 291), when there is no due process observed (Villanos vs. Subido, 45 SCRA
299), or where the protestant has no other recourse (Sta. Maria vs. Lopez, 31 SCRA 637).137 (Emphases
supplied.)
As petitioner correctly pointed out, the appeal provided for under Section 6 of DENR DAO 2003-30 is only
applicable, based on the first sentence thereof, if the person or entity charged with the duty to exhaust the
administrative remedy of appeal to the appropriate government agency has been a party or has been made a
party in the proceedings wherein the decision to be appealed was rendered. It has been established by the
facts that petitioner was never made a party to the proceedings before respondent DENR-EMB RVI. Petitioner
was only informed that the project had already been approved after the ECC was already granted.138 Not
being a party to the said proceedings, it does not appear that petitioner was officially furnished a copy of the
decision, from which the 15-day period to appeal should be reckoned, and which would warrant the
application of Section 6, Article II of DENR DAO 2003-30.
Although petitioner was not a party to the proceedings where the decision to issue an ECC was rendered, it
stands to be aggrieved by the decision,139 because it claims that the reclamation of land on the Caticlan side
would unavoidably adversely affect the Boracay side, where petitioner’s members own establishments
engaged in the tourism trade. As noted earlier, petitioner contends that the declared objective of the
reclamation project is to exploit Boracay’s tourism trade because the project is intended to enhance support
services thereto; however, this objective would not be achieved since the white-sand beaches for which
Boracay is famous might be negatively affected by the project. Petitioner’s conclusion is that respondent
Province, aided and abetted by respondents PRA and DENR-EMB RVI, ignored the spirit and letter of our
environmental laws, and should thus be compelled to perform their duties under said laws.
The new Rules of Procedure for Environmental Cases, A.M. No. 09-6-8-SC, provides a relief for petitioner
under the writ of continuing mandamus, which is a special civil action that may be availed of "to compel the
performance of an act specifically enjoined by law"140 and which provides for the issuance of a TEPO "as an
auxiliary remedy prior to the issuance of the writ itself."141 The Rationale of the said Rules explains the writ in
this wise:
Environmental law highlights the shift in the focal-point from the initiation of regulation by Congress to the
implementation of regulatory programs by the appropriate government agencies.
Thus, a government agency’s inaction, if any, has serious implications on the future of environmental law
enforcement. Private individuals, to the extent that they seek to change the scope of the regulatory process,
will have to rely on such agencies to take the initial incentives, which may require a judicial component.
Accordingly, questions regarding the propriety of an agency’s action or inaction will need to be analyzed.
This point is emphasized in the availability of the remedy of the writ of mandamus, which allows for the
enforcement of the conduct of the tasks to which the writ pertains: the performance of a legal duty.142
(Emphases added.)
The writ of continuing mandamus "permits the court to retain jurisdiction after judgment in order to ensure
the successful implementation of the reliefs mandated under the court’s decision" and, in order to do this, "the
court may compel the submission of compliance reports from the respondent government agencies as well as
avail of other means to monitor compliance with its decision."143
According to petitioner, respondent Province acted pursuant to a MOA with respondent PRA that was
conditioned upon, among others, a properly-secured ECC from respondent DENR-EMB RVI. For this reason,
petitioner seeks to compel respondent Province to comply with certain environmental laws, rules, and
procedures that it claims were either circumvented or ignored. Hence, we find that the petition was
appropriately filed with this Court under Rule 8, Section 1, A.M. No. 09-6-8-SC, which reads:
SECTION 1. Petition for continuing mandamus.—When any agency or instrumentality of the government or
officer thereof unlawfully neglects the performance of an act which the law specifically enjoins as a duty
resulting from an office, trust or station in connection with the enforcement or violation of an environmental
law rule or regulation or a right therein, or unlawfully excludes another from the use or enjoyment of such
right and there is no other plain, speedy and adequate remedy in the ordinary course of law, the person
aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty, attaching
thereto supporting evidence, specifying that the petition concerns an environmental law, rule or regulation,
and praying that judgment be rendered commanding the respondent to do an act or series of acts until the
judgment is fully satisfied, and to pay damages sustained by the petitioner by reason of the malicious neglect
to perform the duties of the respondent, under the law, rules or regulations. The petition shall also contain a
sworn certification of non-forum shopping.
SECTION 2. Where to file the petition.—The petition shall be filed with the Regional Trial Court exercising
jurisdiction over the territory where the actionable neglect or omission occurred or with the Court of Appeals
or the Supreme Court.
Petitioner had three options where to file this case under the rule: the Regional Trial Court exercising
jurisdiction over the territory where the actionable neglect or omission occurred, the Court of Appeals, or this
Court.
Petitioner had no other plain, speedy, or adequate remedy in the ordinary course of law to determine the
questions of unique national and local importance raised here that pertain to laws and rules for environmental
protection, thus it was justified in coming to this Court.
Having resolved the procedural issue, we now move to the substantive issues.
On the issues of whether, based on the scope and classification of the project, a full EIA is required by laws
and regulations, and whether respondent Province complied with all the requirements under the pertinent laws
and regulations
Petitioner’s arguments on this issue hinges upon its claim that the reclamation project is misclassified as a
single project when in fact it is co-located. Petitioner also questions the classification made by respondent
Province that the reclamation project is merely an expansion of the existing jetty port, when the project
descriptions embodied in the different documents filed by respondent Province describe commercial
establishments to be built, among others, to raise revenues for the LGU; thus, it should have been classified as
a new project. Petitioner likewise cries foul to the manner by which respondent Province allegedly
circumvented the documentary requirements of the DENR-EMB RVI by the act of connecting the reclamation
project with its previous project in 1999 and claiming that the new project is a mere expansion of the previous
one.
As previously discussed, respondent Province filed a Manifestation and Motion stating that the ECC issued by
respondent DENR-EMB RVI covered an area of 2,691 square meters in Caticlan, and its application for
reclamation of 40 hectares with respondent PRA was conditioned on its submission of specific documents
within 120 days. Respondent Province claims that its failure to comply with said condition indicated its waiver
to pursue the succeeding phases of the reclamation project and that the subject matter of this case had thus
been limited to 2.64 hectares. Respondent PRA, for its part, declared through its General Manager that the
"Aklan Beach Zone Restoration and Protection Marine Development Project will now be confined to the
reclamation and development of the 2.64 hectares, more or less."144
The Court notes such manifestation of respondent Province. Assuming, however, that the area involved in the
subject reclamation project has been limited to 2.64 hectares, this case has not become moot and academic,
as alleged by respondents, because the Court still has to check whether respondents had complied with all
applicable environmental laws, rules, and regulations pertaining to the actual reclamation project.
We recognize at this point that the DENR is the government agency vested with delegated powers to review
and evaluate all EIA reports, and to grant or deny ECCs to project proponents.145 It is the DENR that has the
duty to implement the EIS system. It appears, however, that respondent DENR-EMB RVI’s evaluation of this
reclamation project was problematic, based on the valid questions raised by petitioner.
Being the administrator of the EIS System, respondent DENR-EMB RVI’s submissions bear great weight in this
case. However, the following are the issues that put in question the wisdom of respondent DENR-EMB RVI in
issuing the ECC:
1. Its approval of respondent Province’s classification of the project as a mere expansion of the existing jetty
port in Caticlan, instead of classifying it as a new project;
2. Its classification of the reclamation project as a single instead of a co-located project;
3. The lack of prior public consultations and approval of local government agencies; and
4. The lack of comprehensive studies regarding the impact of the reclamation project to the environment.
The above issues as raised put in question the sufficiency of the evaluation of the project by respondent
DENR-EMB RVI.
Nature of the project
The first question must be answered by respondent DENR-EMB RVI as the agency with the expertise and
authority to state whether this is a new project, subject to the more rigorous environmental impact study
requested by petitioner, or it is a mere expansion of the existing jetty port facility.
The second issue refers to the classification of the project by respondent Province, approved by respondent
DENR-EMB RVI, as single instead of co-located. Under the Revised Procedural Manual, the "Summary List of
Additional Non-Environmentally-Critical Project (NECP) Types in ECAs Classified under Group II" (Table I-2)
lists "buildings, storage facilities and other structures" as a separate item from "transport terminal facilities."
This creates the question of whether this project should be considered as consisting of more than one type of
activity, and should more properly be classified as "co-located," under the following definition from the same
Manual, which reads:
f) Group IV (Co-located Projects in either ECA or NECA): A co-located project is a group of single projects,
under one or more proponents/locators, which are located in a contiguous area and managed by one
administrator, who is also the ECC applicant. The co-located project may be an economic zone or industrial
park, or a mix of projects within a catchment, watershed or river basin, or any other geographical, political or
economic unit of area. Since the location or threshold of specific projects within the contiguous area will yet be
derived from the EIA process based on the carrying capacity of the project environment, the nature of the
project is called "programmatic." (Emphasis added.)
Respondent DENR-EMB RVI should conduct a thorough and detailed evaluation of the project to address the
question of whether this could be deemed as a group of single projects (transport terminal facility, building,
etc.) in a contiguous area managed by respondent Province, or as a single project.
The third item in the above enumeration will be discussed as a separate issue.
The answer to the fourth question depends on the final classification of the project under items 1 and 3 above
because the type of EIA study required under the Revised Procedural Manual depends on such classification.
The very definition of an EIA points to what was most likely neglected by respondent Province as project
proponent, and what was in turn overlooked by respondent DENR-EMB RVI, for it is defined as follows:
An [EIA] is a ‘process that involves predicting and evaluating the likely impacts of a project (including
cumulative impacts) on the environment during construction, commissioning, operation and abandonment. It
also includes designing appropriate preventive, mitigating and enhancement measures addressing these
consequences to protect the environment and the community’s welfare.146 (Emphases supplied.)
Thus, the EIA process must have been able to predict the likely impact of the reclamation project to the
environment and to prevent any harm that may otherwise be caused.
The project now before us involves reclamation of land that is more than five times the size of the original
reclaimed land. Furthermore, the area prior to construction merely contained a jetty port, whereas the
proposed expansion, as described in the EPRMP submitted by respondent Province to respondent DENR-EMB
RVI involves so much more, and we quote:
The expansion project will be constructed at the north side of the existing jetty port and terminal that will have
a total area of 2.64 hectares, more or less, after reclamation. The Phase 1 of the project construction costing
around ₱260 million includes the following:
1. Reclamation - 3,000 sq m (expansion of jetty port)
2. Reclamation - 13,500 sq m (buildable area)
3. Terminal annex building - 250 sq m
4. 2-storey commercial building – 2,500 sq m (1,750 sq m of leasable space)
5. Health and wellness center
6. Access road - 12 m (wide)
7. Parking, perimeter fences, lighting and water treatment sewerage system
8. Rehabilitation of existing jetty port and terminal
xxxx
The succeeding phases of the project will consist of [further] reclamation, completion of the commercial center
building, bay walk commercial strip, staff building, ferry terminal, a cable car system and wharf marina. This
will entail an additional estimated cost of ₱785 million bringing the total investment requirement to about ₱1.0
billion.147 (Emphases added.)
As may be gleaned from the breakdown of the 2.64 hectares as described by respondent Province above, a
significant portion of the reclaimed area would be devoted to the construction of a commercial building, and
the area to be utilized for the expansion of the jetty port consists of a mere 3,000 square meters (sq. m). To
be true to its definition, the EIA report submitted by respondent Province should at the very least predict the
impact that the construction of the new buildings on the reclaimed land would have on the surrounding
environment. These new constructions and their environmental effects were not covered by the old studies
that respondent Province previously submitted for the construction of the original jetty port in 1999, and which
it re-submitted in its application for ECC in this alleged expansion, instead of conducting updated and more
comprehensive studies.
Any impact on the Boracay side cannot be totally ignored, as Caticlan and Boracay are separated only by a
narrow strait. This becomes more imperative because of the significant contributions of Boracay’s white-sand
beach to the country’s tourism trade, which requires respondent Province to proceed with utmost caution in
implementing projects within its vicinity.
We had occasion to emphasize the duty of local government units to ensure the quality of the environment
under Presidential Decree No. 1586 in Republic of the Philippines v. The City of Davao,148 wherein we held:
Section 15 of Republic Act 7160, otherwise known as the Local Government Code, defines a local government
unit as a body politic and corporate endowed with powers to be exercised by it in conformity with law. As
such, it performs dual functions, governmental and proprietary. Governmental functions are those that
concern the health, safety and the advancement of the public good or welfare as affecting the public
generally. Proprietary functions are those that seek to obtain special corporate benefits or earn pecuniary
profit and intended for private advantage and benefit. When exercising governmental powers and performing
governmental duties, an LGU is an agency of the national government. When engaged in corporate activities,
it acts as an agent of the community in the administration of local affairs.
Found in Section 16 of the Local Government Code is the duty of the LGUs to promote the people’s right to a
balanced ecology. Pursuant to this, an LGU, like the City of Davao, can not claim exemption from the coverage
of PD 1586. As a body politic endowed with governmental functions, an LGU has the duty to ensure the quality
of the environment, which is the very same objective of PD 1586.
xxxx
Section 4 of PD 1586 clearly states that "no person, partnership or corporation shall undertake or operate any
such declared environmentally critical project or area without first securing an Environmental Compliance
Certificate issued by the President or his duly authorized representative." The Civil Code defines a person as
either natural or juridical. The state and its political subdivisions, i.e., the local government units are juridical
persons. Undoubtedly therefore, local government units are not excluded from the coverage of PD 1586.
Lastly, very clear in Section 1 of PD 1586 that said law intends to implement the policy of the state to achieve
a balance between socio-economic development and environmental protection, which are the twin goals of
sustainable development. The above-quoted first paragraph of the Whereas clause stresses that this can only
be possible if we adopt a comprehensive and integrated environmental protection program where all the
sectors of the community are involved, i.e., the government and the private sectors. The local government
units, as part of the machinery of the government, cannot therefore be deemed as outside the scope of the
EIS system.149 (Emphases supplied.)
The Court chooses to remand these matters to respondent DENR-EMB RVI for it to make a proper study, and
if it should find necessary, to require respondent Province to address these environmental issues raised by
petitioner and submit the correct EIA report as required by the project’s specifications. The Court requires
respondent DENR-EMB RVI to complete its study and submit a report within a non-extendible period of three
months. Respondent DENR-EMB RVI should establish to the Court in said report why the ECC it issued for the
subject project should not be canceled.
Lack of prior public consultation
The Local Government Code establishes the duties of national government agencies in the maintenance of
ecological balance, and requires them to secure prior public consultation and approval of local government
units for the projects described therein.
In the case before us, the national agency involved is respondent PRA. Even if the project proponent is the
local government of Aklan, it is respondent PRA which authorized the reclamation, being the exclusive agency
of the government to undertake reclamation nationwide. Hence, it was necessary for respondent Province to
go through respondent PRA and to execute a MOA, wherein respondent PRA’s authority to reclaim was
delegated to respondent Province. Respondent DENR-EMB RVI, regional office of the DENR, is also a national
government institution which is tasked with the issuance of the ECC that is a prerequisite to projects covered
by environmental laws such as the one at bar.
This project can be classified as a national project that affects the environmental and ecological balance of
local communities, and is covered by the requirements found in the Local Government Code provisions that
are quoted below:
Section 26. Duty of National Government Agencies in the Maintenance of Ecological Balance. - It shall be the
duty of every national agency or government-owned or controlled corporation authorizing or involved in the
planning and implementation of any project or program that may cause pollution, climatic change, depletion of
non-renewable resources, loss of crop land, rangeland, or forest cover, and extinction of animal or plant
species, to consult with the local government units, nongovernmental organizations, and other sectors
concerned and explain the goals and objectives of the project or program, its impact upon the people and the
community in terms of environmental or ecological balance, and the measures that will be undertaken to
prevent or minimize the adverse effects thereof.
Section 27. Prior Consultations Required. - No project or program shall be implemented by government
authorities unless the consultations mentioned in Sections 2 (c) and 26 hereof are complied with, and prior
approval of the sanggunian concerned is obtained: Provided, That occupants in areas where such projects are
to be implemented shall not be evicted unless appropriate relocation sites have been provided, in accordance
with the provisions of the Constitution.
In Lina, Jr. v. Paño,150 we held that Section 27 of the Local Government Code applies only to "national
programs and/or projects which are to be implemented in a particular local community"151 and that it should
be read in conjunction with Section 26. We held further in this manner:
Thus, the projects and programs mentioned in Section 27 should be interpreted to mean projects and
programs whose effects are among those enumerated in Section 26 and 27, to wit, those that: (1) may cause
pollution; (2) may bring about climatic change; (3) may cause the depletion of non-renewable resources; (4)
may result in loss of crop land, range-land, or forest cover; (5) may eradicate certain animal or plant species
from the face of the planet; and (6) other projects or programs that may call for the eviction of a particular
group of people residing in the locality where these will be implemented. Obviously, none of these effects will
be produced by the introduction of lotto in the province of Laguna.152 (Emphasis added.)
During the oral arguments held on September 13, 2011, it was established that this project as described above
falls under Section 26 because the commercial establishments to be built on phase 1, as described in the
EPRMP quoted above, could cause pollution as it could generate garbage, sewage, and possible toxic fuel
discharge.153
Our ruling in Province of Rizal v. Executive Secretary154 is instructive:
We reiterated this doctrine in the recent case of Bangus Fry Fisherfolk v. Lanzanas, where we held that there
was no statutory requirement for the sangguniang bayan of Puerto Galera to approve the construction of a
mooring facility, as Sections 26 and 27 are inapplicable to projects which are not environmentally critical.
Moreover, Section 447, which enumerates the powers, duties and functions of the municipality, grants the
sangguniang bayan the power to, among other things, "enact ordinances, approve resolutions and appropriate
funds for the general welfare of the municipality and its inhabitants pursuant to Section 16 of th(e) Code."
These include:
(1) Approving ordinances and passing resolutions to protect the environment and impose appropriate penalties
for acts which endanger the environment, such as dynamite fishing and other forms of destructive fishing,
illegal logging and smuggling of logs, smuggling of natural resources products and of endangered species of
flora and fauna, slash and burn farming, and such other activities which result in pollution, acceleration of
eutrophication of rivers and lakes, or of ecological imbalance; [Section 447 (1)(vi)]
(2) Prescribing reasonable limits and restraints on the use of property within the jurisdiction of the
municipality, adopting a comprehensive land use plan for the municipality, reclassifying land within the
jurisdiction of the city, subject to the pertinent provisions of this Code, enacting integrated zoning ordinances
in consonance with the approved comprehensive land use plan, subject to existing laws, rules and regulations;
establishing fire limits or zones, particularly in populous centers; and regulating the construction, repair or
modification of buildings within said fire limits or zones in accordance with the provisions of this Code; [Section
447 (2)(vi-ix)]
(3) Approving ordinances which shall ensure the efficient and effective delivery of the basic services and
facilities as provided for under Section 17 of this Code, and in addition to said services and facilities,
…providing for the establishment, maintenance, protection, and conservation of communal forests and
watersheds, tree parks, greenbelts, mangroves, and other similar forest development projects …and, subject
to existing laws, establishing and providing for the maintenance, repair and operation of an efficient
waterworks system to supply water for the inhabitants and purifying the source of the water supply; regulating
the construction, maintenance, repair and use of hydrants, pumps, cisterns and reservoirs; protecting the
purity and quantity of the water supply of the municipality and, for this purpose, extending the coverage of
appropriate ordinances over all territory within the drainage area of said water supply and within one hundred
(100) meters of the reservoir, conduit, canal, aqueduct, pumping station, or watershed used in connection
with the water service; and regulating the consumption, use or wastage of water." [Section 447 (5)(i) & (vii)]
Under the Local Government Code, therefore, two requisites must be met before a national project that affects
the environmental and ecological balance of local communities can be implemented: prior consultation with
the affected local communities, and prior approval of the project by the appropriate sanggunian. Absent either
of these mandatory requirements, the project’s implementation is illegal.155 (Emphasis added.)
Based on the above, therefore, prior consultations and prior approval are required by law to have been
conducted and secured by the respondent Province. Accordingly, the information dissemination conducted
months after the ECC had already been issued was insufficient to comply with this requirement under the
Local Government Code. Had they been conducted properly, the prior public consultation should have
considered the ecological or environmental concerns of the stakeholders and studied measures alternative to
the project, to avoid or minimize adverse environmental impact or damage. In fact, respondent Province once
tried to obtain the favorable endorsement of the Sangguniang Bayan of Malay, but this was denied by the
latter.
Moreover, DENR DAO 2003-30 provides:
5.3 Public Hearing / Consultation Requirements
For projects under Category A-1, the conduct of public hearing as part of the EIS review is mandatory unless
otherwise determined by EMB. For all other undertakings, a public hearing is not mandatory unless specifically
required by EMB.
Proponents should initiate public consultations early in order to ensure that environmentally relevant concerns
of stakeholders are taken into consideration in the EIA study and the formulation of the management plan. All
public consultations and public hearings conducted during the EIA process are to be documented. The public
hearing/consultation Process report shall be validated by the EMB/EMB RD and shall constitute part of the
records of the EIA process. (Emphasis supplied.)
In essence, the above-quoted rule shows that in cases requiring public consultations, the same should be
initiated early so that concerns of stakeholders could be taken into consideration in the EIA study. In this case,
respondent Province had already filed its ECC application before it met with the local government units of
Malay and Caticlan.
The claim of respondent DENR-EMB RVI is that no permits and/or clearances from National Government
Agencies (NGAs) and LGUs are required pursuant to the DENR Memorandum Circular No. 2007-08. However,
we still find that the LGC requirements of consultation and approval apply in this case. This is because a
Memorandum Circular cannot prevail over the Local Government Code, which is a statute and which enjoys
greater weight under our hierarchy of laws.
Subsequent to the information campaign of respondent Province, the Municipality of Malay and the Liga ng
mga Barangay-Malay Chapter still opposed the project. Thus, when respondent Province commenced the
implementation project, it violated Section 27 of the LGC, which clearly enunciates that "[no] project or
program shall be implemented by government authorities unless the consultations mentioned in Sections 2(c)
and 26 hereof are complied with, and prior approval of the sanggunian concerned is obtained."
The lack of prior public consultation and approval is not corrected by the subsequent endorsement of the
reclamation project by the Sangguniang Barangay of Caticlan on February 13, 2012, and the Sangguniang
Bayan of the Municipality of Malay on February 28, 2012, which were both undoubtedly achieved at the urging
and insistence of respondent Province. As we have established above, the respective resolutions issued by the
LGUs concerned did not render this petition moot and academic.
It is clear that both petitioner and respondent Province are interested in the promotion of tourism in Boracay
and the protection of the environment, lest they kill the proverbial hen that lays the golden egg. At the
beginning of this decision, we mentioned that there are common goals of national significance that are very
apparent from both the petitioner’s and the respondents’ respective pleadings and memoranda.
The parties are evidently in accord in seeking to uphold the mandate found in Article II, Declaration of
Principles and State Policies, of the 1987 Constitution, which we quote below:
SECTION 16. The State shall protect and advance the right of the people to a balanced and healthful ecology
in accord with the rhythm and harmony of nature.
xxxx
SECTION 20. The State recognizes the indispensable role of the private sector, encourages private enterprise,
and provides incentives to needed investments.
The protection of the environment in accordance with the aforesaid constitutional mandate is the aim, among
others, of Presidential Decree No. 1586, "Establishing an Environmental Impact Statement System, Including
Other Environmental Management Related Measures and For Other Purposes," which declared in its first
Section that it is "the policy of the State to attain and maintain a rational and orderly balance between socio-
economic growth and environmental protection."
The parties undoubtedly too agree as to the importance of promoting tourism, pursuant to Section 2 of
Republic Act No. 9593, or "The Tourism Act of 2009," which reads:
SECTION 2. Declaration of Policy. – The State declares tourism as an indispensable element of the national
economy and an industry of national interest and importance, which must be harnessed as an engine of
socioeconomic growth and cultural affirmation to generate investment, foreign exchange and employment,
and to continue to mold an enhanced sense of national pride for all Filipinos. (Emphasis ours.)
The primordial role of local government units under the Constitution and the Local Government Code of 1991
in the subject matter of this case is also unquestionable. The Local Government Code of 1991 (Republic Act
No. 7160) pertinently provides:
Section 2. Declaration of Policy. - (a) It is hereby declared the policy of the State that the territorial and
political subdivisions of the State shall enjoy genuine and meaningful local autonomy to enable them to attain
their fullest development as self-reliant communities and make them more effective partners in the attainment
of national goals. Toward this end, the State shall provide for a more responsive and accountable local
government structure instituted through a system of decentralization whereby local government units shall be
given more powers, authority, responsibilities, and resources. The process of decentralization shall proceed
from the national government to the local government units.156 (Emphases ours.)
As shown by the above provisions of our laws and rules, the speedy and smooth resolution of these issues
would benefit all the parties. Thus, respondent Province’s cooperation with respondent DENR-EMB RVI in the
Court-mandated review of the proper classification and environmental impact of the reclamation project is of
utmost importance.
WHEREFORE, premises considered, the petition is hereby PARTIALLY GRANTED.1âwphi1 The TEPO issued by
this Court is hereby converted into a writ of continuing mandamus specifically as follows:
1. Respondent Department of Environment and Natural Resources-Environmental Management Bureau
Regional Office VI shall revisit and review the following matters:
a. its classification of the reclamation project as a single instead of a co-located project;
b. its approval of respondent Province’s classification of the project as a mere expansion of the existing jetty
port in Caticlan, instead of classifying it as a new project; and
c. the impact of the reclamation project to the environment based on new, updated, and comprehensive
studies, which should forthwith be ordered by respondent DENR-EMB RVI.
2. Respondent Province of Aklan shall perform the following:
a. fully cooperate with respondent DENR-EMB RVI in its review of the reclamation project proposal and submit
to the latter the appropriate report and study; and
b. secure approvals from local government units and hold proper consultations with non-governmental
organizations and other stakeholders and sectors concerned as required by Section 27 in relation to Section 26
of the Local Government Code.
3. Respondent Philippine Reclamation Authority shall closely monitor the submission by respondent Province of
the requirements to be issued by respondent DENR-EMB RVI in connection to the environmental concerns
raised by petitioner, and shall coordinate with respondent Province in modifying the MOA, if necessary, based
on the findings of respondent DENR-EMB RVI.
4. The petitioner Boracay Foundation, Inc. and the respondents The Province of Aklan, represented by
Governor Carlito S. Marquez, The Philippine Reclamation Authority, and The DENR-EMB (Region VI) are
mandated to submit their respective reports to this Court regarding their compliance with the requirements set
forth in this Decision no later than three (3) months from the date of promulgation of this Decision.
5. In the meantime, the respondents, their concerned contractor/s, and/or their agents, representatives or
persons acting in their place or stead, shall immediately cease and desist from continuing the implementation
of the project covered by ECC-R6-1003-096-7100 until further orders from this Court. For this purpose, the
respondents shall report within five (5) days to this Court the status of the project as of their receipt of this
Decision, copy furnished the petitioner.
This Decision is immediately executory.
SO ORDERED.

8. MAGGALLONA ET AL VS EXECUTIVE SECRETARY

EN BANC
G.R No. 187167 August 16, 2011
PROF. MERLIN M. MAGALLONA, AKBAYAN PARTY-LIST REP. RISA HONTIVEROS, PROF. HARRY C. ROQUE,
JR., AND UNIVERSITY OF THE PHILIPPINES COLLEGE OF LAW STUDENTS, ALITHEA BARBARA ACAS,
VOLTAIRE ALFERES, CZARINA MAY ALTEZ, FRANCIS ALVIN ASILO, SHERYL BALOT, RUBY AMOR BARRACA,
JOSE JAVIER BAUTISTA, ROMINA BERNARDO, VALERIE PAGASA BUENAVENTURA, EDAN MARRI CAÑETE,
VANN ALLEN DELA CRUZ, RENE DELORINO, PAULYN MAY DUMAN, SHARON ESCOTO, RODRIGO FAJARDO III,
GIRLIE FERRER, RAOULLE OSEN FERRER, CARLA REGINA GREPO, ANNA MARIE CECILIA GO, IRISH KAY
KALAW, MARY ANN JOY LEE, MARIA LUISA MANALAYSAY, MIGUEL RAFAEL MUSNGI, MICHAEL OCAMPO,
JAKLYN HANNA PINEDA, WILLIAM RAGAMAT, MARICAR RAMOS, ENRIK FORT REVILLAS, JAMES MARK TERRY
RIDON, JOHANN FRANTZ RIVERA IV, CHRISTIAN RIVERO, DIANNE MARIE ROA, NICHOLAS SANTIZO,
MELISSA CHRISTINA SANTOS, CRISTINE MAE TABING, VANESSA ANNE TORNO, MARIA ESTER VANGUARDIA,
and MARCELINO VELOSO III, Petitioners,
vs.
HON. EDUARDO ERMITA, IN HIS CAPACITY AS EXECUTIVE SECRETARY, HON. ALBERTO ROMULO, IN HIS
CAPACITY AS SECRETARY OF THE DEPARTMENT OF FOREIGN AFFAIRS, HON. ROLANDO ANDAYA, IN HIS
CAPACITY AS SECRETARY OF THE DEPARTMENT OF BUDGET AND MANAGEMENT, HON. DIONY VENTURA, IN
HIS CAPACITY AS ADMINISTRATOR OF THE NATIONAL MAPPING & RESOURCE INFORMATION AUTHORITY,
and HON. HILARIO DAVIDE, JR., IN HIS CAPACITY AS REPRESENTATIVE OF THE PERMANENT MISSION OF
THE REPUBLIC OF THE PHILIPPINES TO THE UNITED NATIONS, Respondents.
DECISION
CARPIO, J.:
The Case
This original action for the writs of certiorari and prohibition assails the constitutionality of Republic Act No.
95221 (RA 9522) adjusting the country’s archipelagic baselines and classifying the baseline regime of nearby
territories.
The Antecedents
In 1961, Congress passed Republic Act No. 3046 (RA 3046)2 demarcating the maritime baselines of the
Philippines as an archipelagic State.3 This law followed the framing of the Convention on the Territorial Sea
and the Contiguous Zone in 1958 (UNCLOS I),4 codifying, among others, the sovereign right of States parties
over their "territorial sea," the breadth of which, however, was left undetermined. Attempts to fill this void
during the second round of negotiations in Geneva in 1960 (UNCLOS II) proved futile. Thus, domestically, RA
3046 remained unchanged for nearly five decades, save for legislation passed in 1968 (Republic Act No. 5446
[RA 5446]) correcting typographical errors and reserving the drawing of baselines around Sabah in North
Borneo.
In March 2009, Congress amended RA 3046 by enacting RA 9522, the statute now under scrutiny. The change
was prompted by the need to make RA 3046 compliant with the terms of the United Nations Convention on
the Law of the Sea (UNCLOS III),5 which the Philippines ratified on 27 February 1984.6 Among others,
UNCLOS III prescribes the water-land ratio, length, and contour of baselines of archipelagic States like the
Philippines7 and sets the deadline for the filing of application for the extended continental shelf.8 Complying
with these requirements, RA 9522 shortened one baseline, optimized the location of some basepoints around
the Philippine archipelago and classified adjacent territories, namely, the Kalayaan Island Group (KIG) and the
Scarborough Shoal, as "regimes of islands" whose islands generate their own applicable maritime zones.
Petitioners, professors of law, law students and a legislator, in their respective capacities as "citizens,
taxpayers or x x x legislators,"9 as the case may be, assail the constitutionality of RA 9522 on two principal
grounds, namely: (1) RA 9522 reduces Philippine maritime territory, and logically, the reach of the Philippine
state’s sovereign power, in violation of Article 1 of the 1987 Constitution,10 embodying the terms of the Treaty
of Paris11 and ancillary treaties,12 and (2) RA 9522 opens the country’s waters landward of the baselines to
maritime passage by all vessels and aircrafts, undermining Philippine sovereignty and national security,
contravening the country’s nuclear-free policy, and damaging marine resources, in violation of relevant
constitutional provisions.13
In addition, petitioners contend that RA 9522’s treatment of the KIG as "regime of islands" not only results in
the loss of a large maritime area but also prejudices the livelihood of subsistence fishermen.14 To buttress
their argument of territorial diminution, petitioners facially attack RA 9522 for what it excluded and included –
its failure to reference either the Treaty of Paris or Sabah and its use of UNCLOS III’s framework of regime of
islands to determine the maritime zones of the KIG and the Scarborough Shoal.
Commenting on the petition, respondent officials raised threshold issues questioning (1) the petition’s
compliance with the case or controversy requirement for judicial review grounded on petitioners’ alleged lack
of locus standi and (2) the propriety of the writs of certiorari and prohibition to assail the constitutionality of
RA 9522. On the merits, respondents defended RA 9522 as the country’s compliance with the terms of
UNCLOS III, preserving Philippine territory over the KIG or Scarborough Shoal. Respondents add that RA 9522
does not undermine the country’s security, environment and economic interests or relinquish the Philippines’
claim over Sabah.
Respondents also question the normative force, under international law, of petitioners’ assertion that what
Spain ceded to the United States under the Treaty of Paris were the islands and all the waters found within the
boundaries of the rectangular area drawn under the Treaty of Paris.
We left unacted petitioners’ prayer for an injunctive writ.
The Issues
The petition raises the following issues:
1. Preliminarily –
1. Whether petitioners possess locus standi to bring this suit; and
2. Whether the writs of certiorari and prohibition are the proper remedies to assail the constitutionality of RA
9522.
2. On the merits, whether RA 9522 is unconstitutional.
The Ruling of the Court
On the threshold issues, we hold that (1) petitioners possess locus standi to bring this suit as citizens and (2)
the writs of certiorari and prohibition are proper remedies to test the constitutionality of RA 9522. On the
merits, we find no basis to declare RA 9522 unconstitutional.
On the Threshold Issues
Petitioners Possess Locus
Standi as Citizens
Petitioners themselves undermine their assertion of locus standi as legislators and taxpayers because the
petition alleges neither infringement of legislative prerogative15 nor misuse of public funds,16 occasioned by
the passage and implementation of RA 9522. Nonetheless, we recognize petitioners’ locus standi as citizens
with constitutionally sufficient interest in the resolution of the merits of the case which undoubtedly raises
issues of national significance necessitating urgent resolution. Indeed, owing to the peculiar nature of RA
9522, it is understandably difficult to find other litigants possessing "a more direct and specific interest" to
bring the suit, thus satisfying one of the requirements for granting citizenship standing.17
The Writs of Certiorari and Prohibition
Are Proper Remedies to Test
the Constitutionality of Statutes
In praying for the dismissal of the petition on preliminary grounds, respondents seek a strict observance of the
offices of the writs of certiorari and prohibition, noting that the writs cannot issue absent any showing of grave
abuse of discretion in the exercise of judicial, quasi-judicial or ministerial powers on the part of respondents
and resulting prejudice on the part of petitioners.18
Respondents’ submission holds true in ordinary civil proceedings. When this Court exercises its constitutional
power of judicial review, however, we have, by tradition, viewed the writs of certiorari and prohibition as
proper remedial vehicles to test the constitutionality of statutes,19 and indeed, of acts of other branches of
government.20 Issues of constitutional import are sometimes crafted out of statutes which, while having no
bearing on the personal interests of the petitioners, carry such relevance in the life of this nation that the
Court inevitably finds itself constrained to take cognizance of the case and pass upon the issues raised, non-
compliance with the letter of procedural rules notwithstanding. The statute sought to be reviewed here is one
such law.
RA 9522 is Not Unconstitutional
RA 9522 is a Statutory Tool
to Demarcate the Country’s
Maritime Zones and Continental
Shelf Under UNCLOS III, not to
Delineate Philippine Territory
Petitioners submit that RA 9522 "dismembers a large portion of the national territory"21 because it discards
the pre-UNCLOS III demarcation of Philippine territory under the Treaty of Paris and related treaties,
successively encoded in the definition of national territory under the 1935, 1973 and 1987 Constitutions.
Petitioners theorize that this constitutional definition trumps any treaty or statutory provision denying the
Philippines sovereign control over waters, beyond the territorial sea recognized at the time of the Treaty of
Paris, that Spain supposedly ceded to the United States. Petitioners argue that from the Treaty of Paris’
technical description, Philippine sovereignty over territorial waters extends hundreds of nautical miles around
the Philippine archipelago, embracing the rectangular area delineated in the Treaty of Paris.22
Petitioners’ theory fails to persuade us.
UNCLOS III has nothing to do with the acquisition (or loss) of territory. It is a multilateral treaty regulating,
among others, sea-use rights over maritime zones (i.e., the territorial waters [12 nautical miles from the
baselines], contiguous zone [24 nautical miles from the baselines], exclusive economic zone [200 nautical
miles from the baselines]), and continental shelves that UNCLOS III delimits.23 UNCLOS III was the
culmination of decades-long negotiations among United Nations members to codify norms regulating the
conduct of States in the world’s oceans and submarine areas, recognizing coastal and archipelagic States’
graduated authority over a limited span of waters and submarine lands along their coasts.
On the other hand, baselines laws such as RA 9522 are enacted by UNCLOS III States parties to mark-out
specific basepoints along their coasts from which baselines are drawn, either straight or contoured, to serve as
geographic starting points to measure the breadth of the maritime zones and continental shelf. Article 48 of
UNCLOS III on archipelagic States like ours could not be any clearer:
Article 48. Measurement of the breadth of the territorial sea, the contiguous zone, the exclusive economic
zone and the continental shelf. – The breadth of the territorial sea, the contiguous zone, the exclusive
economic zone and the continental shelf shall be measured from archipelagic baselines drawn in accordance
with article 47. (Emphasis supplied)
Thus, baselines laws are nothing but statutory mechanisms for UNCLOS III States parties to delimit with
precision the extent of their maritime zones and continental shelves. In turn, this gives notice to the rest of the
international community of the scope of the maritime space and submarine areas within which States parties
exercise treaty-based rights, namely, the exercise of sovereignty over territorial waters (Article 2), the
jurisdiction to enforce customs, fiscal, immigration, and sanitation laws in the contiguous zone (Article 33), and
the right to exploit the living and non-living resources in the exclusive economic zone (Article 56) and
continental shelf (Article 77).
Even under petitioners’ theory that the Philippine territory embraces the islands and all the waters within the
rectangular area delimited in the Treaty of Paris, the baselines of the Philippines would still have to be drawn
in accordance with RA 9522 because this is the only way to draw the baselines in conformity with UNCLOS III.
The baselines cannot be drawn from the boundaries or other portions of the rectangular area delineated in the
Treaty of Paris, but from the "outermost islands and drying reefs of the archipelago."24
UNCLOS III and its ancillary baselines laws play no role in the acquisition, enlargement or, as petitioners claim,
diminution of territory. Under traditional international law typology, States acquire (or conversely, lose)
territory through occupation, accretion, cession and prescription,25 not by executing multilateral treaties on
the regulations of sea-use rights or enacting statutes to comply with the treaty’s terms to delimit maritime
zones and continental shelves. Territorial claims to land features are outside UNCLOS III, and are instead
governed by the rules on general international law.26
RA 9522’s Use of the Framework
of Regime of Islands to Determine the
Maritime Zones of the KIG and the
Scarborough Shoal, not Inconsistent
with the Philippines’ Claim of Sovereignty
Over these Areas
Petitioners next submit that RA 9522’s use of UNCLOS III’s regime of islands framework to draw the baselines,
and to measure the breadth of the applicable maritime zones of the KIG, "weakens our territorial claim" over
that area.27 Petitioners add that the KIG’s (and Scarborough Shoal’s) exclusion from the Philippine
archipelagic baselines results in the loss of "about 15,000 square nautical miles of territorial waters,"
prejudicing the livelihood of subsistence fishermen.28 A comparison of the configuration of the baselines
drawn under RA 3046 and RA 9522 and the extent of maritime space encompassed by each law, coupled with
a reading of the text of RA 9522 and its congressional deliberations, vis-à-vis the Philippines’ obligations under
UNCLOS III, belie this view.1avvphi1
The configuration of the baselines drawn under RA 3046 and RA 9522 shows that RA 9522 merely followed the
basepoints mapped by RA 3046, save for at least nine basepoints that RA 9522 skipped to optimize the
location of basepoints and adjust the length of one baseline (and thus comply with UNCLOS III’s limitation on
the maximum length of baselines). Under RA 3046, as under RA 9522, the KIG and the Scarborough Shoal lie
outside of the baselines drawn around the Philippine archipelago. This undeniable cartographic fact takes the
wind out of petitioners’ argument branding RA 9522 as a statutory renunciation of the Philippines’ claim over
the KIG, assuming that baselines are relevant for this purpose.
Petitioners’ assertion of loss of "about 15,000 square nautical miles of territorial waters" under RA 9522 is
similarly unfounded both in fact and law. On the contrary, RA 9522, by optimizing the location of basepoints,
increased the Philippines’ total maritime space (covering its internal waters, territorial sea and exclusive
economic zone) by 145,216 square nautical miles, as shown in the table below:29

Extent of maritime area using RA 3046, as amended, taking into account the Treaty of Paris’ delimitation (in
square nautical miles)
Extent of maritime area using RA 9522, taking into account UNCLOS III (in square nautical miles)
Internal or archipelagic waters
166,858
171,435
Territorial Sea
274,136
32,106
Exclusive Economic Zone

382,669
TOTAL
440,994
586,210
Thus, as the map below shows, the reach of the exclusive economic zone drawn under RA 9522 even extends
way beyond the waters covered by the rectangular demarcation under the Treaty of Paris. Of course, where
there are overlapping exclusive economic zones of opposite or adjacent States, there will have to be a
delineation of maritime boundaries in accordance with UNCLOS III.30

Further, petitioners’ argument that the KIG now lies outside Philippine territory because the baselines that RA
9522 draws do not enclose the KIG is negated by RA 9522 itself. Section 2 of the law commits to text the
Philippines’ continued claim of sovereignty and jurisdiction over the KIG and the Scarborough Shoal:
SEC. 2. The baselines in the following areas over which the Philippines likewise exercises sovereignty and
jurisdiction shall be determined as "Regime of Islands" under the Republic of the Philippines consistent with
Article 121 of the United Nations Convention on the Law of the Sea (UNCLOS):
a) The Kalayaan Island Group as constituted under Presidential Decree No. 1596 and
b) Bajo de Masinloc, also known as Scarborough Shoal. (Emphasis supplied)
Had Congress in RA 9522 enclosed the KIG and the Scarborough Shoal as part of the Philippine archipelago,
adverse legal effects would have ensued. The Philippines would have committed a breach of two provisions of
UNCLOS III. First, Article 47 (3) of UNCLOS III requires that "[t]he drawing of such baselines shall not depart
to any appreciable extent from the general configuration of the archipelago." Second, Article 47 (2) of UNCLOS
III requires that "the length of the baselines shall not exceed 100 nautical miles," save for three per cent (3%)
of the total number of baselines which can reach up to 125 nautical miles.31
Although the Philippines has consistently claimed sovereignty over the KIG32 and the Scarborough Shoal for
several decades, these outlying areas are located at an appreciable distance from the nearest shoreline of the
Philippine archipelago,33 such that any straight baseline loped around them from the nearest basepoint will
inevitably "depart to an appreciable extent from the general configuration of the archipelago."
The principal sponsor of RA 9522 in the Senate, Senator Miriam Defensor-Santiago, took pains to emphasize
the foregoing during the Senate deliberations:
What we call the Kalayaan Island Group or what the rest of the world call[] the Spratlys and the Scarborough
Shoal are outside our archipelagic baseline because if we put them inside our baselines we might be accused
of violating the provision of international law which states: "The drawing of such baseline shall not depart to
any appreciable extent from the general configuration of the archipelago." So sa loob ng ating baseline, dapat
magkalapit ang mga islands. Dahil malayo ang Scarborough Shoal, hindi natin masasabing malapit sila sa atin
although we are still allowed by international law to claim them as our own.
This is called contested islands outside our configuration. We see that our archipelago is defined by the orange
line which [we] call[] archipelagic baseline. Ngayon, tingnan ninyo ang maliit na circle doon sa itaas, that is
Scarborough Shoal, itong malaking circle sa ibaba, that is Kalayaan Group or the Spratlys. Malayo na sila sa
ating archipelago kaya kung ilihis pa natin ang dating archipelagic baselines para lamang masama itong
dalawang circles, hindi na sila magkalapit at baka hindi na tatanggapin ng United Nations because of the rule
that it should follow the natural configuration of the archipelago.34 (Emphasis supplied)
Similarly, the length of one baseline that RA 3046 drew exceeded UNCLOS III’s limits.1avvphi1 The need to
shorten this baseline, and in addition, to optimize the location of basepoints using current maps, became
imperative as discussed by respondents:
[T]he amendment of the baselines law was necessary to enable the Philippines to draw the outer limits of its
maritime zones including the extended continental shelf in the manner provided by Article 47 of [UNCLOS III].
As defined by R.A. 3046, as amended by R.A. 5446, the baselines suffer from some technical deficiencies, to
wit:
1. The length of the baseline across Moro Gulf (from Middle of 3 Rock Awash to Tongquil Point) is 140.06
nautical miles x x x. This exceeds the maximum length allowed under Article 47(2) of the [UNCLOS III], which
states that "The length of such baselines shall not exceed 100 nautical miles, except that up to 3 per cent of
the total number of baselines enclosing any archipelago may exceed that length, up to a maximum length of
125 nautical miles."
2. The selection of basepoints is not optimal. At least 9 basepoints can be skipped or deleted from the
baselines system. This will enclose an additional 2,195 nautical miles of water.
3. Finally, the basepoints were drawn from maps existing in 1968, and not established by geodetic survey
methods. Accordingly, some of the points, particularly along the west coasts of Luzon down to Palawan were
later found to be located either inland or on water, not on low-water line and drying reefs as prescribed by
Article 47.35
Hence, far from surrendering the Philippines’ claim over the KIG and the Scarborough Shoal, Congress’
decision to classify the KIG and the Scarborough Shoal as "‘Regime[s] of Islands’ under the Republic of the
Philippines consistent with Article 121"36 of UNCLOS III manifests the Philippine State’s responsible
observance of its pacta sunt servanda obligation under UNCLOS III. Under Article 121 of UNCLOS III, any
"naturally formed area of land, surrounded by water, which is above water at high tide," such as portions of
the KIG, qualifies under the category of "regime of islands," whose islands generate their own applicable
maritime zones.37
Statutory Claim Over Sabah under
RA 5446 Retained
Petitioners’ argument for the invalidity of RA 9522 for its failure to textualize the Philippines’ claim over Sabah
in North Borneo is also untenable. Section 2 of RA 5446, which RA 9522 did not repeal, keeps open the door
for drawing the baselines of Sabah:
Section 2. The definition of the baselines of the territorial sea of the Philippine Archipelago as provided in this
Act is without prejudice to the delineation of the baselines of the territorial sea around the territory of Sabah,
situated in North Borneo, over which the Republic of the Philippines has acquired dominion and sovereignty.
(Emphasis supplied)
UNCLOS III and RA 9522 not
Incompatible with the Constitution’s
Delineation of Internal Waters
As their final argument against the validity of RA 9522, petitioners contend that the law unconstitutionally
"converts" internal waters into archipelagic waters, hence subjecting these waters to the right of innocent and
sea lanes passage under UNCLOS III, including overflight. Petitioners extrapolate that these passage rights
indubitably expose Philippine internal waters to nuclear and maritime pollution hazards, in violation of the
Constitution.38
Whether referred to as Philippine "internal waters" under Article I of the Constitution39 or as "archipelagic
waters" under UNCLOS III (Article 49 [1]), the Philippines exercises sovereignty over the body of water lying
landward of the baselines, including the air space over it and the submarine areas underneath. UNCLOS III
affirms this:
Article 49. Legal status of archipelagic waters, of the air space over archipelagic waters and of their bed and
subsoil. –
1. The sovereignty of an archipelagic State extends to the waters enclosed by the archipelagic baselines drawn
in accordance with article 47, described as archipelagic waters, regardless of their depth or distance from the
coast.
2. This sovereignty extends to the air space over the archipelagic waters, as well as to their bed and subsoil,
and the resources contained therein.
xxxx
4. The regime of archipelagic sea lanes passage established in this Part shall not in other respects affect the
status of the archipelagic waters, including the sea lanes, or the exercise by the archipelagic State of its
sovereignty over such waters and their air space, bed and subsoil, and the resources contained therein.
(Emphasis supplied)
The fact of sovereignty, however, does not preclude the operation of municipal and international law norms
subjecting the territorial sea or archipelagic waters to necessary, if not marginal, burdens in the interest of
maintaining unimpeded, expeditious international navigation, consistent with the international law principle of
freedom of navigation. Thus, domestically, the political branches of the Philippine government, in the
competent discharge of their constitutional powers, may pass legislation designating routes within the
archipelagic waters to regulate innocent and sea lanes passage.40 Indeed, bills drawing nautical highways for
sea lanes passage are now pending in Congress.41
In the absence of municipal legislation, international law norms, now codified in UNCLOS III, operate to grant
innocent passage rights over the territorial sea or archipelagic waters, subject to the treaty’s limitations and
conditions for their exercise.42 Significantly, the right of innocent passage is a customary international law,43
thus automatically incorporated in the corpus of Philippine law.44 No modern State can validly invoke its
sovereignty to absolutely forbid innocent passage that is exercised in accordance with customary international
law without risking retaliatory measures from the international community.
The fact that for archipelagic States, their archipelagic waters are subject to both the right of innocent passage
and sea lanes passage45 does not place them in lesser footing vis-à-vis continental coastal States which are
subject, in their territorial sea, to the right of innocent passage and the right of transit passage through
international straits. The imposition of these passage rights through archipelagic waters under UNCLOS III was
a concession by archipelagic States, in exchange for their right to claim all the waters landward of their
baselines, regardless of their depth or distance from the coast, as archipelagic waters subject to their territorial
sovereignty. More importantly, the recognition of archipelagic States’ archipelago and the waters enclosed by
their baselines as one cohesive entity prevents the treatment of their islands as separate islands under
UNCLOS III.46 Separate islands generate their own maritime zones, placing the waters between islands
separated by more than 24 nautical miles beyond the States’ territorial sovereignty, subjecting these waters to
the rights of other States under UNCLOS III.47
Petitioners’ invocation of non-executory constitutional provisions in Article II (Declaration of Principles and
State Policies)48 must also fail. Our present state of jurisprudence considers the provisions in Article II as
mere legislative guides, which, absent enabling legislation, "do not embody judicially enforceable constitutional
rights x x x."49 Article II provisions serve as guides in formulating and interpreting implementing legislation, as
well as in interpreting executory provisions of the Constitution. Although Oposa v. Factoran50 treated the right
to a healthful and balanced ecology under Section 16 of Article II as an exception, the present petition lacks
factual basis to substantiate the claimed constitutional violation. The other provisions petitioners cite, relating
to the protection of marine wealth (Article XII, Section 2, paragraph 251 ) and subsistence fishermen (Article
XIII, Section 752 ), are not violated by RA 9522.
In fact, the demarcation of the baselines enables the Philippines to delimit its exclusive economic zone,
reserving solely to the Philippines the exploitation of all living and non-living resources within such zone. Such
a maritime delineation binds the international community since the delineation is in strict observance of
UNCLOS III. If the maritime delineation is contrary to UNCLOS III, the international community will of course
reject it and will refuse to be bound by it.
UNCLOS III favors States with a long coastline like the Philippines. UNCLOS III creates a sui generis maritime
space – the exclusive economic zone – in waters previously part of the high seas. UNCLOS III grants new
rights to coastal States to exclusively exploit the resources found within this zone up to 200 nautical miles.53
UNCLOS III, however, preserves the traditional freedom of navigation of other States that attached to this
zone beyond the territorial sea before UNCLOS III.
RA 9522 and the Philippines’ Maritime Zones
Petitioners hold the view that, based on the permissive text of UNCLOS III, Congress was not bound to pass
RA 9522.54 We have looked at the relevant provision of UNCLOS III55 and we find petitioners’ reading
plausible. Nevertheless, the prerogative of choosing this option belongs to Congress, not to this Court.
Moreover, the luxury of choosing this option comes at a very steep price. Absent an UNCLOS III compliant
baselines law, an archipelagic State like the Philippines will find itself devoid of internationally acceptable
baselines from where the breadth of its maritime zones and continental shelf is measured. This is recipe for a
two-fronted disaster: first, it sends an open invitation to the seafaring powers to freely enter and exploit the
resources in the waters and submarine areas around our archipelago; and second, it weakens the country’s
case in any international dispute over Philippine maritime space. These are consequences Congress wisely
avoided.
The enactment of UNCLOS III compliant baselines law for the Philippine archipelago and adjacent areas, as
embodied in RA 9522, allows an internationally-recognized delimitation of the breadth of the Philippines’
maritime zones and continental shelf. RA 9522 is therefore a most vital step on the part of the Philippines in
safeguarding its maritime zones, consistent with the Constitution and our national interest.
WHEREFORE, we DISMISS the petition.
SO ORDERED.

9. MINERS ASSOCIATION OF THE PHILIPPINES VS FACTORAN

G.R. No. 98332 January 16, 1995

MINERS ASSOCIATION OF THE PHILIPPINES, INC., petitioner,
vs.
HON. FULGENCIO S. FACTORAN, JR., Secretary of Environment and Natural Resources, and JOEL D. MUYCO,
Director of Mines and Geosciences Bureau, respondents.

ROMERO, J.:
The instant petition seeks a ruling from this Court on the validity of two Administrative Orders issued by the
Secretary of the Department of Environment and Natural Resources to carry out the provisions of certain
Executive Orders promulgated by the President in the lawful exercise of legislative powers.
Herein controversy was precipitated by the change introduced by Article XII, Section 2 of the 1987
Constitution on the system of exploration, development and utilization of the country's natural resources. No
longer is the utilization of inalienable lands of public domain through "license, concession or lease" under the
1935 and 1973 Constitutions1 allowed under the 1987 Constitution.
The adoption of the concept of jura regalia2 that all natural resources are owned by the State embodied in the
1935, 1973 and 1987 Constitutions, as well as the recognition of the importance of the country's natural
resources, not only for national economic development, but also for its security and national
defense,3 ushered in the adoption of the constitutional policy of "full control and supervision by the State" in
the exploration, development and utilization of the country's natural resources. The options open to the State
are through direct undertaking or by entering into co-production, joint venture; or production-sharing
agreements, or by entering into agreement with foreign-owned corporations for large-scale exploration,
development and utilization.
Article XII, Section 2 of the 1987 Constitution provides:
Sec. 2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned
by the State. With the exception of agricultural lands, all other natural resources shall not be alienated. The
exploration, development, and utilization of natural resources shall be under the full control and supervision of
the State. The State may directly undertake such activities, or it may enter into co-production, joint venture, or
product-sharing agreements with Filipino citizens, or corporations or associations at least sixty per centum of
whose capital is owned by such citizens. Such agreements may be for a period not exceeding twenty-five
years, renewable for not more than twenty-five years, and under such terms and conditions as may be
provided by law. In cases of water rights for irrigation, water supply, fisheries, or industrial uses other than the
development of water power, beneficial use may be the measure and limit of the grant.
xxx xxx xxx
The President may enter into agreements with foreign-owned corporations involving either technical or
financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other
mineral oils according to the general terms and conditions provided by law, based on real contributions to the
economic growth and general welfare of the country. In such agreements, the State shall promote the
development and use of local scientific and technical resources.
The President shall notify the Congress of every contract entered into in accordance with this provision, within
thirty days from its execution. (Emphasis supplied)
Pursuant to the mandate of the above-quoted provision, legislative acts4 were successively issued by the
President in the exercise of her legislative
power.5
To implement said legislative acts, the Secretary of the Department of Environment and Natural Resources
(DENR) in turn promulgated Administrative Order Nos. 57 and 82, the validity and constitutionality of which
are being challenged in this petition.
On July 10, 1987, President Corazon C. Aquino, in the exercise of her then legislative powers under Article II,
Section 1 of the Provisional Constitution and Article XIII, Section 6 of the 1987 Constitution, promulgated
Executive Order No. 211 prescribing the interim procedures in the processing and approval of applications for
the exploration, development and utilization of minerals pursuant to the 1987 Constitution in order to ensure
the continuity of mining operations and activities and to hasten the development of mineral resources. The
pertinent provisions read as follows:
Sec. 1. Existing mining permits, licenses, leases and other mining grants issued by the Department of
Environment and Natural Resources and Bureau of Mines and Geo-Sciences, including existing operating
agreements and mining service contracts, shall continue and remain in full force and effect, subject to the
same terms and conditions as originally granted and/or approved.
Sec. 2. Applications for the exploration, development and utilization of mineral resources, including renewal
applications for approval of operating agreements and mining service contracts, shall be accepted and
processed and may be approved; concomitantly thereto, declarations of locations and all other kinds of mining
applications shall be accepted and registered by the Bureau of Mines and Geo-Sciences.
Sec. 3. The processing, evaluation and approval of all mining applications, declarations of locations, operating
agreements and service contracts as provided for in Section 2 above, shall be governed by Presidential Decree
No. 463, as amended, other existing mining laws and their implementing rules and regulations: Provided,
however, that the privileges granted, as well as the terms and conditions thereof shall be subject to any and
all modifications or alterations which Congress may adopt pursuant to Section 2, Article XII of the 1987
Constitution.
On July 25, 1987, President Aquino likewise promulgated Executive Order No. 279 authorizing the DENR
Secretary to negotiate and conclude joint venture, co-production, or production-sharing agreements for the
exploration, development and utilization of mineral resources, and prescribing the guidelines for such
agreements and those agreements involving technical or financial assistance by foreign-owned corporations for
large-scale exploration, development, and utilization of minerals. The pertinent provisions relevant to this
petition are as follows:
Sec. 1. The Secretary of the Department of Environment and Natural Resources (hereinafter referred to as
"the Secretary") is hereby authorized 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 citizens, or corporation or association at least sixty percent (60%) of whose
capital is owned by Filipino citizens. Such joint venture, co-production, or production-sharing agreements may
be for a period not exceeding twenty-five years, renewable for not more than twenty-five years, and shall
include the minimum terms and conditions prescribed in Section 2 hereof. In the execution of a joint venture,
co-production or production agreements, the contracting parties, including the Government, may consolidate
two or more contiguous or geologically — related mining claims or leases and consider them as one contract
area for purposes of determining the subject of the joint venture, co-production, or production-sharing
agreement.
xxx xxx xxx
Sec. 6. The Secretary shall promulgate such supplementary rules and regulations as may be necessary to
effectively implement the provisions of this Executive Order.
Sec. 7. All provisions of Presidential Decree No. 463, as amended, other existing mining laws, and their
implementing rules and regulations, or parts thereof, which are not inconsistent with the provisions of this
Executive Order, shall continue in force and effect.
Pursuant to Section 6 of Executive Order No. 279, the DENR Secretary issued on June 23, 1989 DENR
Administrative Order No. 57, series of 1989, captioned "Guidelines of Mineral Production Sharing Agreement
under Executive Order No. 279."6 Under the transitory provision of said DENR Administrative Order No. 57,
embodied in its Article 9, all existing mining leases or agreements which were granted after the effectivity of
the 1987 Constitution pursuant to Executive Order No. 211, except small scale mining leases and those
pertaining to sand and gravel and quarry resources covering an area of twenty (20) hectares or less, shall be
converted into production-sharing agreements within one (1) year from the effectivity of these guidelines.
On November 20, 1980, the Secretary of the DENR Administrative Order No. 82, series of 1990, laying down
the "Procedural Guidelines on the Award of Mineral Production Sharing Agreement (MPSA) through
Negotiation."7
Section 3 of the aforementioned DENR Administrative Order No. 82 enumerates the persons or entities
required to submit Letter of Intent (LOIs) and Mineral Production Sharing Agreement (MPSAs) within two (2)
years from the effectivity of DENR Administrative Order No. 57 or until July 17, 1991. Failure to do so within
the prescribed period shall cause the abandonment of mining, quarry and sand and gravel claims. Section 3 of
DENR Administrative Order No. 82 provides:
Sec. 3. Submission of Letter of Intent (LOIs) and MPSAs). The following shall submit their LOIs and MPSAs
within two (2) years from the effectivity of DENR A.O. 57 or until July 17, 1991.
i. Declaration of Location (DOL) holders, mining lease applicants, exploration permitees, quarry applicants and
other mining applicants whose mining/quarry applications have not been perfected prior to the effectivity of
DENR Administrative Order No. 57.
ii. All holders of DOL acquired after the effectivity of DENR A.O. No. 57.
iii. Holders of mining leases or similar agreements which were granted after (the) effectivity of 1987
Constitution.
Failure to submit letters of intent and MPSA applications/proposals within the prescribed period shall cause the
abandonment of mining, quarry and sand and gravel claims.
The issuance and the impeding implementation by the DENR of Administrative Order Nos. 57 and 82 after
their respective effectivity dates compelled the Miners Association of the Philippines, Inc.8 to file the instant
petition assailing their validity and constitutionality before this Court.
In this petition for certiorari, petitioner Miners Association of the Philippines, Inc. mainly contends that
respondent Secretary of DENR issued both Administrative Order Nos. 57 and 82 in excess of his rule-making
power under Section 6 of Executive Order No. 279. On the assumption that the questioned administrative
orders do not conform with Executive Order Nos. 211 and 279, petitioner contends that both orders violate the
non-impairment of contract provision under Article III, Section 10 of the 1987 Constitution on the ground that
Administrative Order No. 57 unduly pre-terminates existing mining agreements and automatically converts
them into production-sharing agreements within one (1) year from its effectivity date. On the other hand,
Administrative Order No. 82 declares that failure to submit Letters of Intent and Mineral Production-Sharing
Agreements within two (2) years from the date of effectivity of said guideline or on July 17, 1991 shall cause
the abandonment of their mining, quarry and sand gravel permits.
On July 2, 1991, the Court, acting on petitioner's urgent ex-parte petition for issuance of a restraining
order/preliminary injunction, issued a Temporary Restraining Order, upon posting of a P500,000.00 bond,
enjoining the enforcement and implementation of DENR Administrative Order Nos. 57 and 82, as amended,
Series of 1989 and 1990, respectively.9
On November 13, 1991, Continental Marble Corporation, 10 thru its President, Felipe A. David, sought to
intervene 11 in this case alleging that because of the temporary order issued by the Court , the DENR,
Regional Office No. 3 in San Fernando, Pampanga refused to renew its Mines Temporary Permit after it
expired on July 31, 1991. Claiming that its rights and interests are prejudicially affected by the implementation
of DENR Administrative Order Nos. 57 and 82, it joined petitioner herein in seeking to annul Administrative
Order Nos. 57 and 82 and prayed that the DENR, Regional Office No. 3 be ordered to issue a Mines Temporary
Permit in its favor to enable it to operate during the pendency of the suit.
Public respondents were acquired to comment on the Continental Marble Corporation's petition for intervention
in the resolution of November 28, 1991.12
Now to the main petition. If its argued that Administrative Order Nos. 57 and 82 have the effect of repealing
or abrogating existing mining laws 13 which are not inconsistent with the provisions of Executive Order No.
279. Invoking Section 7 of said Executive Order No. 279, 14 petitioner maintains that respondent DENR
Secretary cannot provide guidelines such as Administrative Order Nos. 57 and 82 which are inconsistent with
the provisions of Executive Order No. 279 because both Executive Order Nos. 211 and 279 merely reiterated
the acceptance and registration of declarations of location and all other kinds of mining applications by the
Bureau of Mines and Geo-Sciences under the provisions of Presidential Decree No. 463, as amended, until
Congress opts to modify or alter the same.
In other words, petitioner would have us rule that DENR Administrative Order Nos. 57 and 82 issued by the
DENR Secretary in the exercise of his rule-making power are tainted with invalidity inasmuch as both
contravene or subvert the provisions of Executive Order Nos. 211 and 279 or embrace matters not covered,
nor intended to be covered, by the aforesaid laws.
We disagree.
We reiterate the principle that the power of administrative officials to promulgate rules and regulations in the
implementation of a statute is necessarily limited only to carrying into effect what is provided in the legislative
enactment. The principle was enunciated as early as 1908 in the case of United States v. Barrias. 15 The
scope of the exercise of such rule-making power was clearly expressed in the case of United States v. Tupasi
Molina, 16 decided in 1914, thus: "Of course, the regulations adopted under legislative authority by a
particular department must be in harmony with the provisions of the law, and for the sole purpose of carrying
into effect its general provisions. By such regulations, of course, the law itself can not be extended. So long,
however, as the regulations relate solely to carrying into effect its general provisions. By such regulations, of
course, the law itself can not be extended. So long, however, as the regulations relate solely to carrying into
effect the provision of the law, they are valid."
Recently, the case of People v. Maceren 17 gave a brief delienation of the scope of said power of
administrative officials:
Administrative regulations adopted under legislative authority by a particular department must be in harmony
with the provisions of the law, and should be for the sole purpose of carrying into effect its general provision.
By such regulations, of course, the law itself cannot be extended (U.S. v. Tupasi Molina, supra). An
administrative agency cannot amend an act of Congress (Santos vs. Estenzo, 109 Phil. 419, 422; Teoxon vs.
Members of the Board of Administrators, L-25619, June 30, 1970, 33 SCRA 585; Manuel vs. General Auditing
Office, L-28952, December 29, 1971, 42 SCRA 660; Deluao v. Casteel, L-21906, August 29, 1969, 29 SCRA
350).
The rule-making power must be confined to details for regulating the mode or proceeding to carry into effect
the law as it has been enacted. The power cannot be extended to amending or expanding the statutory
requirements or to embrace matters not covered by the statute. Rules that subvert the statute cannot be
sanctioned (University of Santo Tomas v. Board of Tax Appeals, 93 Phil. 376, 382, citing 12 C.J. 845-46. As to
invalid regulations, see Collector of Internal Revenue v. Villaflor, 69 Phil. 319; Wise & Co. v. Meer, 78 Phil.
655, 676; Del Mar v. Phil. Veterans Administration, L-27299, June 27, 1973, 51 SCRA 340, 349).
xxx xxx xxx
. . . The rule or regulation should be within the scope of the statutory authority granted by the legislature to
the administrative agency (Davis, Administrative Law, p. 194, 197, cited in Victorias Milling Co., Inc. v. Social
Security Commission, 114 Phil. 555, 558).
In case of discrepancy between the basic law and a rule or regulation issued to implement said law, the basic
prevails because said rule or regulations cannot go beyond the terms and provisions of the basic law (People
v. Lim, 108 Phil. 1091).
Considering that administrative rules draw life from the statute which they seek to implement, it is obvious
that the spring cannot rise higher than its source. We now examine petitioner's argument that DENR
Administrative Order Nos. 57 and 82 contravene Executive Order Nos. 211 and 279 as both operate to repeal
or abrogate Presidential Decree No. 463, as amended, and other mining laws allegedly acknowledged as the
principal law under Executive Order Nos. 211 and 279.
Petitioner's insistence on the application of Presidential Decree No. 463, as amended, as the governing law on
the acceptance and approval of declarations of location and all other kinds of applications for the exploration,
development, and utilization of mineral resources pursuant to Executive Order No. 211, is erroneous.
Presidential Decree No. 463, as amended, pertains to the old system of exploration, development and
utilization of natural resources through "license, concession or lease" which, however, has been disallowed by
Article XII, Section 2 of the 1987 Constitution. By virtue of the said constitutional mandate and its
implementing law, Executive Order No. 279 which superseded Executive Order No. 211, the provisions dealing
on "license, concession or lease" of mineral resources under Presidential Decree No. 463, as amended, and
other existing mining laws are deemed repealed and, therefore, ceased to operate as the governing law. In
other words, in all other areas of administration and management of mineral lands, the provisions of
Presidential Decree No. 463, as amended, and other existing mining laws, still govern. Section 7 of Executive
Order No. 279 provides, thus:
Sec. 7. All provisions of Presidential Decree No. 463, as amended, other existing mining laws, and their
implementing rules and regulations, or parts thereof, which are not inconsistent with the provisions of this
Executive Order, shall continue in force and effect.
Specifically, the provisions of Presidential Decree No. 463, as amended, on lease of mining claims under
Chapter VIII, quarry permits on privately-owned lands of quarry license on public lands under Chapter XIII
and other related provisions on lease, license and permits are not only inconsistent with the raison d'etre for
which Executive Order No. 279 was passed, but contravene the express mandate of Article XII, Section 2 of
the 1987 Constitution. It force and effectivity is thus foreclosed.
Upon the effectivity of the 1987 Constitution on February 2, 1987, 18 the State assumed a more dynamic role
in the exploration, development and utilization of the natural resources of the country. Article XII, Section 2 of
the said Charter explicitly ordains that the exploration, development and utilization of natural resources shall
be under the full control and supervision of the State. Consonant therewith, the exploration, development and
utilization of natural resources may be undertaken by means of direct act of the State, or it may opt to enter
into co-production, joint venture, or production-sharing agreements, or it may enter into agreements with
foreign-owned corporations involving either technical or financial assistance for large-scale exploration,
development, and utilization of minerals, petroleum, and other mineral oils according to the general terms and
conditions provided by law, based on real contributions to the economic growth and general welfare of the
country.
Given these considerations, there is no clear showing that respondent DENR Secretary has transcended the
bounds demarcated by Executive Order No. 279 for the exercise of his rule-making power tantamount to a
grave abuse of discretion. Section 6 of Executive Order No. 279 specifically authorizes said official to
promulgate such supplementary rules and regulations as may be necessary to effectively implement the
provisions thereof. Moreover, the subject sought to be governed and regulated by the questioned orders is
germane to the objects and purposes of Executive Order No. 279 specifically issued to carry out the mandate
of Article XII, Section 2 of the 1987 Constitution.
Petitioner likewise maintains that Administrative Order No. 57, in relation to Administrative Order No. 82,
impairs vested rights as to violate the non-impairment of contract doctrine guaranteed under Article III,
Section 10 of the 1987 Constitution because Article 9 of Administrative Order No. 57 unduly pre-terminates
and automatically converts mining leases and other mining agreements into production-sharing agreements
within one (1) year from effectivity of said guideline, while Section 3 of Administrative Order No. 82, declares
that failure to submit Letters of Intent (LOIs) and MPSAs within two (2) years from the effectivity of
Administrative Order No. 57 or until July 17, 1991 shall cause the abandonment of mining, quarry, and sand
gravel permits.
In Support of the above contention, it is argued by petitioner that Executive Order No. 279 does not
contemplate automatic conversion of mining lease agreements into mining production-sharing agreement as
provided under Article 9, Administrative Order No. 57 and/or the consequent abandonment of mining claims
for failure to submit LOIs and MPSAs under Section 3, Administrative Order No. 82 because Section 1 of said
Executive Order No. 279 empowers the DENR Secretary to negotiate and enter into voluntary agreements
which must set forth the minimum terms and conditions provided under Section 2 thereof. Moreover,
petitioner contends that the power to regulate and enter into mining agreements does not include the power
to preterminate existing mining lease agreements.
To begin with, we dispel the impression created by petitioner's argument that the questioned administrative
orders unduly preterminate existing mining leases in general. A distinction which spells a real difference must
be drawn. Article XII, Section 2 of the 1987 Constitution does not apply retroactively to "license, concession or
lease" granted by the government under the 1973 Constitution or before the effectivity of the 1987
Constitution on February 2, 1987. The intent to apply prospectively said constitutional provision was stressed
during the deliberations in the Constitutional Commission, 19 thus:
MR. DAVIDE: Under the proposal, I notice that except for the [inalienable] lands of the public domain, all other
natural resources cannot be alienated and in respect to [alienable] lands of the public domain, private
corporations with the required ownership by Filipino citizens can only lease the same. Necessarily, insofar as
other natural resources are concerned, it would only be the State which can exploit, develop, explore and
utilize the same. However, the State may enter into a joint venture, co-production or production-sharing. Is
that not correct?
MR. VILLEGAS: Yes.
MR. DAVIDE: Consequently, henceforth upon, the approval of this Constitution, no timber or forest concession,
permits or authorization can be exclusively granted to any citizen of the Philippines nor to any corporation
qualified to acquire lands of the public domain?
MR. VILLEGAS: Would Commissioner Monsod like to comment on that? I think his answer is "yes."
MR. DAVIDE: So, what will happen now license or concessions earlier granted by the Philippine government to
private corporations or to Filipino citizens? Would they be deemed repealed?
MR. VILLEGAS: This is not applied retroactively. They will be respected.
MR. DAVIDE: In effect, they will be deemed repealed?
MR. VILLEGAS: No. (Emphasis supplied)
During the transition period or after the effectivity of the 1987 Constitution on February 2, 1987 until the first
Congress under said Constitution was convened on July 27, 1987, two (2) successive laws, Executive Order
Nos. 211 and 279, were promulgated to govern the processing and approval of applications for the
exploration, development and utilization of minerals. To carry out the purposes of said laws, the questioned
Administrative Order Nos. 57 and 82, now being assailed, were issued by the DENR Secretary.
Article 9 of Administrative Order No. 57 provides:
ARTICLE 9
TRANSITORY PROVISION
9.1. All existing mining leases or agreements which were granted after the effectivity of the 1987 Constitution
pursuant to Executive Order No. 211, except small scale mining leases and those pertaining to sand and gravel
and quarry resources covering an area of twenty (20) hectares or less shall be subject to these guidelines. All
such leases or agreements shall be converted into production sharing agreement within one (1) year from the
effectivity of these guidelines. However, any minimum firm which has established mining rights under
Presidential Decree 463 or other laws may avail of the provisions of EO 279 by following the procedures set
down in this document.
It is clear from the aforestated provision that Administrative Order No. 57 applies only to all existing mining
leases or agreements which were granted after the effectivity of the 1987 Constitution pursuant to Executive
Order No. 211. It bears mention that under the text of Executive Order No. 211, there is a reservation clause
which provides that the privileges as well as the terms and conditions of all existing mining leases or
agreements granted after the effectivity of the 1987 Constitution pursuant to Executive Order No. 211, shall be
subject to any and all modifications or alterations which Congress may adopt pursuant to Article XII, Section 2
of the 1987 Constitution. Hence, the strictures of the
non-impairment of contract clause under Article III, Section 10 of the 1987 Constitution 20 do not apply to the
aforesaid leases or agreements granted after the effectivity of the 1987 Constitution, pursuant to Executive
Order No. 211. They can be amended, modified or altered by a statute passed by Congress to achieve the
purposes of Article XII, Section 2 of the 1987 Constitution.
Clearly, Executive Order No. 279 issued on July 25, 1987 by President Corazon C. Aquino in the exercise of her
legislative power has the force and effect of a statute or law passed by Congress. As such, it validly modified
or altered the privileges granted, as well as the terms and conditions of mining leases and agreements under
Executive Order No. 211 after the effectivity of the 1987 Constitution by authorizing the DENR Secretary to
negotiate and conclude joint venture, co-production, or production-sharing agreements for the exploration,
development and utilization of mineral resources and prescribing the guidelines for such agreements and those
agreements involving technical or financial assistance by foreign-owned corporations for large-scale
exploration, development, and utilization of minerals.
Well -settled is the rule, however, that regardless of the reservation clause, mining leases or agreements
granted by the State, such as those granted pursuant to Executive Order No. 211 referred to this petition, are
subject to alterations through a reasonable exercise of the police power of the State. In the 1950 case of
Ongsiako v. Gamboa, 21 where the constitutionality of Republic Act No. 34 changing the 50-50 sharecropping
system in existing agricultural tenancy contracts to 55-45 in favor of tenants was challenged, the Court,
upholding the constitutionality of the law, emphasized the superiority of the police power of the State over the
sanctity of this contract:
The prohibition contained in constitutional provisions against: impairing the obligation of contracts is not an
absolute one and it is not to be read with literal exactness like a mathematical formula. Such provisions are
restricted to contracts which respect property, or some object or value, and confer rights which may be
asserted in a court of justice, and have no application to statute relating to public subjects within the domain
of the general legislative powers of the State, and involving the public rights and public welfare of the entire
community affected by it. They do not prevent a proper exercise by the State of its police powers. By enacting
regulations reasonably necessary to secure the health, safety, morals, comfort, or general welfare of the
community, even the contracts may thereby be affected; for such matter can not be placed by contract
beyond the power of the State shall regulates and control them. 22
In Ramas v. CAR and Ramos 23 where the constitutionality of Section 14 of Republic Act No. 1199 authorizing
the tenants to charge from share to leasehold tenancy was challenged on the ground that it impairs the
obligation of contracts, the Court ruled that obligations of contracts must yield to a proper exercise of the
police power when such power is exercised to preserve the security of the State and the means adopted are
reasonably adapted to the accomplishment of that end and are, therefore, not arbitrary or oppressive.
The economic policy on the exploration, development and utilization of the country's natural resources under
Article XII, Section 2 of the 1987 Constitution could not be any clearer. As enunciated in Article XII, Section 1
of the 1987 Constitution, the exploration, development and utilization of natural resources under the new
system mandated in Section 2, is geared towards a more equitable distribution of opportunities, income, and
wealth; a sustained increase in the amount of goods and services produced by the nation for the benefit of the
people; and an expanding productivity as the key to raising the quality of life for all, especially the
underprivileged.
The exploration, development and utilization of the country's natural resources are matters vital to the public
interest and the general welfare of the people. The recognition of the importance of the country's natural
resources was expressed as early as the 1984 Constitutional Convention. In connection therewith, the 1986
U.P. Constitution Project observed: "The 1984 Constitutional Convention recognized the importance of our
natural resources not only for its security and national defense. Our natural resources which constitute the
exclusive heritage of the Filipino nation, should be preserved for those under the sovereign authority of that
nation and for their prosperity. This will ensure the country's survival as a viable and sovereign republic."
Accordingly, the State, in the exercise of its police power in this regard, may not be precluded by the
constitutional restriction on non-impairment of contract from altering, modifying and amending the mining
leases or agreements granted under Presidential Decree No. 463, as amended, pursuant to Executive Order
No. 211. Police Power, being co-extensive with the necessities of the case and the demands of public interest;
extends to all the vital public needs. The passage of Executive Order No. 279 which superseded Executive
Order No. 211 provided legal basis for the DENR Secretary to carry into effect the mandate of Article XII,
Section 2 of the 1987 Constitution.
Nowhere in Administrative Order No. 57 is there any provision which would lead us to conclude that the
questioned order authorizes the automatic conversion of mining leases and agreements granted after the
effectivity of the 1987 Constitution, pursuant to Executive Order No. 211, to production-sharing agreements.
The provision in Article 9 of Administrative Order No. 57 that "all such leases or agreements shall be converted
into production sharing agreements within one (1) year from the effectivity of these guidelines" could not
possibility contemplate a unilateral declaration on the part of the Government that all existing mining leases
and agreements are automatically converted into
production-sharing agreements. On the contrary, the use of the term "production-sharing agreement" if they
are so minded. Negotiation negates compulsion or automatic conversion as suggested by petitioner in the
instant petition. A mineral production-sharing agreement (MPSA) requires a meeting of the minds of the
parties after negotiations arrived at in good faith and in accordance with the procedure laid down in the
subsequent Administrative Order No. 82.
We, therefore, rule that the questioned administrative orders are reasonably directed to the accomplishment of
the purposes of the law under which they were issued and were intended to secure the paramount interest of
the public, their economic growth and welfare. The validity and constitutionality of Administrative Order Nos.
57 and 82 must be sustained, and their force and effect upheld.
We now, proceed to the petition-in-intervention. Under Section 2, Rule 12 of the Revised Rules of Court, an
intervention in a case is proper when the intervenor has a "legal interest in the matter in litigation, or in the
success of either of the parties, or an interest against both, or when he is so situated as to be adversely
affected by a distribution or other disposition of property in the custody of the court or of an officer thereof.
"Continental Marble Corporation has not sufficiently shown that it falls under any of the categories mentioned
above. The refusal of the DENR, Regional Office No. 3, San Fernando, Pampanga to renew its Mines
Temporary Permit does not justify such an intervention by Continental Marble Corporation for the purpose of
obtaining a directive from this Court for the issuance of said permit. Whether or not Continental Marble matter
best addressed to the appropriate government body but certainly, not through this Court. Intervention is
hereby DENIED.
WHEREFORE, the petition is DISMISSED for lack of merit. The Temporary Restraining Order issued on July 2,
1991 is hereby LIFTED.
SO ORDERED.

10. LA BUGAL BLAAN VS RAMOS

G.R. No. 127882 January 27, 2004

LA BUGAL-B'LAAN TRIBAL ASSOCIATION, INC., represented by its Chairman F'LONG MIGUEL M. LUMAYONG,
WIGBERTO E. TAÑADA, PONCIANO BENNAGEN, JAIME TADEO, RENATO R. CONSTANTINO, JR., F'LONG
AGUSTIN M. DABIE, ROBERTO P. AMLOY, RAQIM L. DABIE, SIMEON H. DOLOJO, IMELDA M. GANDON, LENY
B. GUSANAN, MARCELO L. GUSANAN, QUINTOL A. LABUAYAN, LOMINGGES D. LAWAY, BENITA P. TACUAYAN,
minors JOLY L. BUGOY, represented by his father UNDERO D. BUGOY, ROGER M. DADING, represented by his
father ANTONIO L. DADING, ROMY M. LAGARO, represented by his father TOTING A. LAGARO, MIKENY JONG
B. LUMAYONG, represented by his father MIGUEL M. LUMAYONG, RENE T. MIGUEL, represented by his mother
EDITHA T. MIGUEL, ALDEMAR L. SAL, represented by his father DANNY M. SAL, DAISY RECARSE, represented
by her mother LYDIA S. SANTOS, EDWARD M. EMUY, ALAN P. MAMPARAIR, MARIO L. MANGCAL, ALDEN S.
TUSAN, AMPARO S. YAP, VIRGILIO CULAR, MARVIC M.V.F. LEONEN, JULIA REGINA CULAR, GIAN CARLO
CULAR, VIRGILIO CULAR, JR., represented by their father VIRGILIO CULAR, PAUL ANTONIO P. VILLAMOR,
represented by his parents JOSE VILLAMOR and ELIZABETH PUA-VILLAMOR, ANA GININA R. TALJA,
represented by her father MARIO JOSE B. TALJA, SHARMAINE R. CUNANAN, represented by her father
ALFREDO M. CUNANAN, ANTONIO JOSE A. VITUG III, represented by his mother ANNALIZA A. VITUG, LEAN
D. NARVADEZ, represented by his father MANUEL E. NARVADEZ, JR., ROSERIO MARALAG LINGATING,
represented by her father RIO OLIMPIO A. LINGATING, MARIO JOSE B. TALJA, DAVID E. DE VERA, MARIA
MILAGROS L. SAN JOSE, SR., SUSAN O. BOLANIO, OND, LOLITA G. DEMONTEVERDE, BENJIE L. NEQUINTO,1
ROSE LILIA S. ROMANO, ROBERTO S. VERZOLA, EDUARDO AURELIO C. REYES, LEAN LOUEL A. PERIA,
represented by his father ELPIDIO V. PERIA,2 GREEN FORUM PHILIPPINES, GREEN FORUM WESTERN
VISAYAS, (GF-WV), ENVIRONMETAL LEGAL ASSISTANCE CENTER (ELAC), PHILIPPINE KAISAHAN TUNGO SA
KAUNLARAN NG KANAYUNAN AT REPORMANG PANSAKAHAN (KAISAHAN),3 KAISAHAN TUNGO SA
KAUNLARAN NG KANAYUNAN AT REPORMANG PANSAKAHAN (KAISAHAN), PARTNERSHIP FOR AGRARIAN
REFORM and RURAL DEVELOPMENT SERVICES, INC. (PARRDS), PHILIPPINE PART`NERSHIP FOR THE
DEVELOPMENT OF HUMAN RESOURCES IN THE RURAL AREAS, INC. (PHILDHRRA), WOMEN'S LEGAL BUREAU
(WLB), CENTER FOR ALTERNATIVE DEVELOPMENT INITIATIVES, INC. (CADI), UPLAND DEVELOPMENT
INSTITUTE (UDI), KINAIYAHAN FOUNDATION, INC., SENTRO NG ALTERNATIBONG LINGAP PANLIGAL
(SALIGAN), LEGAL RIGHTS AND NATURAL RESOURCES CENTER, INC. (LRC), petitioners,
vs.
VICTOR O. RAMOS, SECRETARY, DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES (DENR),
HORACIO RAMOS, DIRECTOR, MINES AND GEOSCIENCES BUREAU (MGB-DENR), RUBEN TORRES,
EXECUTIVE SECRETARY, and WMC (PHILIPPINES), INC.4 respondents.
DECISION
CARPIO-MORALES, J.:
The present petition for mandamus and prohibition assails the constitutionality of Republic Act No. 7942,5
otherwise known as the PHILIPPINE MINING ACT OF 1995, along with the Implementing Rules and
Regulations issued pursuant thereto, Department of Environment and Natural Resources (DENR)
Administrative Order 96-40, and of the Financial and Technical Assistance Agreement (FTAA) entered into on
March 30, 1995 by the Republic of the Philippines and WMC (Philippines), Inc. (WMCP), a corporation
organized under Philippine laws.
On July 25, 1987, then President Corazon C. Aquino issued Executive Order (E.O.) No. 2796 authorizing the
DENR Secretary to accept, consider and evaluate proposals from foreign-owned corporations or foreign
investors for contracts or agreements involving either technical or financial assistance for large-scale
exploration, development, and utilization of minerals, which, upon appropriate recommendation of the
Secretary, the President may execute with the foreign proponent. In entering into such proposals, the
President shall consider the real contributions to the economic growth and general welfare of the country that
will be realized, as well as the development and use of local scientific and technical resources that will be
promoted by the proposed contract or agreement. Until Congress shall determine otherwise, large-scale
mining, for purpose of this Section, shall mean those proposals for contracts or agreements for mineral
resources exploration, development, and utilization involving a committed capital investment in a single mining
unit project of at least Fifty Million Dollars in United States Currency (US $50,000,000.00).7
On March 3, 1995, then President Fidel V. Ramos approved R.A. No. 7942 to "govern the exploration,
development, utilization and processing of all mineral resources."8 R.A. No. 7942 defines the modes of mineral
agreements for mining operations,9 outlines the procedure for their filing and approval,10
assignment/transfer11 and withdrawal,12 and fixes their terms.13 Similar provisions govern financial or
technical assistance agreements.14
The law prescribes the qualifications of contractors15 and grants them certain rights, including timber,16
water17 and easement18 rights, and the right to possess explosives.19 Surface owners, occupants, or
concessionaires are forbidden from preventing holders of mining rights from entering private lands and
concession areas.20 A procedure for the settlement of conflicts is likewise provided for.21
The Act restricts the conditions for exploration,22 quarry23 and other24 permits. It regulates the transport,
sale and processing of minerals,25 and promotes the development of mining communities, science and mining
technology,26 and safety and environmental protection.27
The government's share in the agreements is spelled out and allocated,28 taxes and fees are imposed,29
incentives granted.30 Aside from penalizing certain acts,31 the law likewise specifies grounds for the
cancellation, revocation and termination of agreements and permits.32
On April 9, 1995, 30 days following its publication on March 10, 1995 in Malaya and Manila Times, two
newspapers of general circulation, R.A. No. 7942 took effect.33 Shortly before the effectivity of R.A. No. 7942,
however, or on March 30, 1995, the President entered into an FTAA with WMCP covering 99,387 hectares of
land in South Cotabato, Sultan Kudarat, Davao del Sur and North Cotabato.34
On August 15, 1995, then DENR Secretary Victor O. Ramos issued DENR Administrative Order (DAO) No. 95-
23, s. 1995, otherwise known as the Implementing Rules and Regulations of R.A. No. 7942. This was later
repealed by DAO No. 96-40, s. 1996 which was adopted on December 20, 1996.
On January 10, 1997, counsels for petitioners sent a letter to the DENR Secretary demanding that the DENR
stop the implementation of R.A. No. 7942 and DAO No. 96-40,35 giving the DENR fifteen days from receipt36
to act thereon. The DENR, however, has yet to respond or act on petitioners' letter.37
Petitioners thus filed the present petition for prohibition and mandamus, with a prayer for a temporary
restraining order. They allege that at the time of the filing of the petition, 100 FTAA applications had already
been filed, covering an area of 8.4 million hectares,38 64 of which applications are by fully foreign-owned
corporations covering a total of 5.8 million hectares, and at least one by a fully foreign-owned mining company
over offshore areas.39
Petitioners claim that the DENR Secretary acted without or in excess of jurisdiction:
I
x x x in signing and promulgating DENR Administrative Order No. 96-40 implementing Republic Act No. 7942,
the latter being unconstitutional in that it allows fully foreign owned corporations to explore, develop, utilize
and exploit mineral resources in a manner contrary to Section 2, paragraph 4, Article XII of the Constitution;
II
x x x in signing and promulgating DENR Administrative Order No. 96-40 implementing Republic Act No. 7942,
the latter being unconstitutional in that it allows the taking of private property without the determination of
public use and for just compensation;

III
x x x in signing and promulgating DENR Administrative Order No. 96-40 implementing Republic Act No. 7942,
the latter being unconstitutional in that it violates Sec. 1, Art. III of the Constitution;
IV
x x x in signing and promulgating DENR Administrative Order No. 96-40 implementing Republic Act No. 7942,
the latter being unconstitutional in that it allows enjoyment by foreign citizens as well as fully foreign owned
corporations of the nation's marine wealth contrary to Section 2, paragraph 2 of Article XII of the Constitution;
V
x x x in signing and promulgating DENR Administrative Order No. 96-40 implementing Republic Act No. 7942,
the latter being unconstitutional in that it allows priority to foreign and fully foreign owned corporations in the
exploration, development and utilization of mineral resources contrary to Article XII of the Constitution;
VI
x x x in signing and promulgating DENR Administrative Order No. 96-40 implementing Republic Act No. 7942,
the latter being unconstitutional in that it allows the inequitable sharing of wealth contrary to Sections [sic] 1,
paragraph 1, and Section 2, paragraph 4[,] [Article XII] of the Constitution;
VII
x x x in recommending approval of and implementing the Financial and Technical Assistance Agreement
between the President of the Republic of the Philippines and Western Mining Corporation Philippines Inc.
because the same is illegal and unconstitutional.40
They pray that the Court issue an order:
(a) Permanently enjoining respondents from acting on any application for Financial or Technical Assistance
Agreements;
(b) Declaring the Philippine Mining Act of 1995 or Republic Act No. 7942 as unconstitutional and null and void;
(c) Declaring the Implementing Rules and Regulations of the Philippine Mining Act contained in DENR
Administrative Order No. 96-40 and all other similar administrative issuances as unconstitutional and null and
void; and
(d) Cancelling the Financial and Technical Assistance Agreement issued to Western Mining Philippines, Inc. as
unconstitutional, illegal and null and void.41
Impleaded as public respondents are Ruben Torres, the then Executive Secretary, Victor O. Ramos, the then
DENR Secretary, and Horacio Ramos, Director of the Mines and Geosciences Bureau of the DENR. Also
impleaded is private respondent WMCP, which entered into the assailed FTAA with the Philippine Government.
WMCP is owned by WMC Resources International Pty., Ltd. (WMC), "a wholly owned subsidiary of Western
Mining Corporation Holdings Limited, a publicly listed major Australian mining and exploration company."42 By
WMCP's information, "it is a 100% owned subsidiary of WMC LIMITED."43
Respondents, aside from meeting petitioners' contentions, argue that the requisites for judicial inquiry have
not been met and that the petition does not comply with the criteria for prohibition and mandamus.
Additionally, respondent WMCP argues that there has been a violation of the rule on hierarchy of courts.
After petitioners filed their reply, this Court granted due course to the petition. The parties have since filed
their respective memoranda.
WMCP subsequently filed a Manifestation dated September 25, 2002 alleging that on January 23, 2001, WMC
sold all its shares in WMCP to Sagittarius Mines, Inc. (Sagittarius), a corporation organized under Philippine
laws.44 WMCP was subsequently renamed "Tampakan Mineral Resources Corporation."45 WMCP claims that
at least 60% of the equity of Sagittarius is owned by Filipinos and/or Filipino-owned corporations while about
40% is owned by Indophil Resources NL, an Australian company.46 It further claims that by such sale and
transfer of shares, "WMCP has ceased to be connected in any way with WMC."47
By virtue of such sale and transfer, the DENR Secretary, by Order of December 18, 2001,48 approved the
transfer and registration of the subject FTAA from WMCP to Sagittarius. Said Order, however, was appealed by
Lepanto Consolidated Mining Co. (Lepanto) to the Office of the President which upheld it by Decision of July
23, 2002.49 Its motion for reconsideration having been denied by the Office of the President by Resolution of
November 12, 2002,50 Lepanto filed a petition for review51 before the Court of Appeals. Incidentally, two
other petitions for review related to the approval of the transfer and registration of the FTAA to Sagittarius
were recently resolved by this Court.52
It bears stressing that this case has not been rendered moot either by the transfer and registration of the
FTAA to a Filipino-owned corporation or by the non-issuance of a temporary restraining order or a preliminary
injunction to stay the above-said July 23, 2002 decision of the Office of the President.53 The validity of the
transfer remains in dispute and awaits final judicial determination. This assumes, of course, that such transfer
cures the FTAA's alleged unconstitutionality, on which question judgment is reserved.
WMCP also points out that the original claimowners of the major mineralized areas included in the WMCP
FTAA, namely, Sagittarius, Tampakan Mining Corporation, and Southcot Mining Corporation, are all Filipino-
owned corporations,54 each of which was a holder of an approved Mineral Production Sharing Agreement
awarded in 1994, albeit their respective mineral claims were subsumed in the WMCP FTAA;55 and that these
three companies are the same companies that consolidated their interests in Sagittarius to whom WMC sold its
100% equity in WMCP.56 WMCP concludes that in the event that the FTAA is invalidated, the MPSAs of the
three corporations would be revived and the mineral claims would revert to their original claimants.57
These circumstances, while informative, are hardly significant in the resolution of this case, it involving the
validity of the FTAA, not the possible consequences of its invalidation.
Of the above-enumerated seven grounds cited by petitioners, as will be shown later, only the first and the last
need be delved into; in the latter, the discussion shall dwell only insofar as it questions the effectivity of E. O.
No. 279 by virtue of which order the questioned FTAA was forged.
I
Before going into the substantive issues, the procedural questions posed by respondents shall first be tackled.
REQUISITES FOR JUDICIAL REVIEW
When an issue of constitutionality is raised, this Court can exercise its power of judicial review only if the
following requisites are present:
(1) The existence of an actual and appropriate case;
(2) A personal and substantial interest of the party raising the constitutional question;
(3) The exercise of judicial review is pleaded at the earliest opportunity; and
(4) The constitutional question is the lis mota of the case. 58
Respondents claim that the first three requisites are not present.
Section 1, Article VIII of the Constitution states that "(j)udicial power includes the duty of the courts of justice
to settle actual controversies involving rights which are legally demandable and enforceable." The power of
judicial review, therefore, is limited to the determination of actual cases and controversies.59
An actual case or controversy means an existing case or controversy that is appropriate or ripe for
determination, not conjectural or anticipatory,60 lest the decision of the court would amount to an advisory
opinion.61 The power does not extend to hypothetical questions62 since any attempt at abstraction could only
lead to dialectics and barren legal questions and to sterile conclusions unrelated to actualities.63
"Legal standing" or locus standi has been defined as a personal and substantial interest in the case such that
the party has sustained or will sustain direct injury as a result of the governmental act that is being
challenged,64 alleging more than a generalized grievance.65 The gist of the question of standing is whether a
party alleges "such personal stake in the outcome of the controversy as to assure that concrete adverseness
which sharpens the presentation of issues upon which the court depends for illumination of difficult
constitutional questions."66 Unless a person is injuriously affected in any of his constitutional rights by the
operation of statute or ordinance, he has no standing.67
Petitioners traverse a wide range of sectors. Among them are La Bugal B'laan Tribal Association, Inc., a
farmers and indigenous people's cooperative organized under Philippine laws representing a community
actually affected by the mining activities of WMCP, members of said cooperative,68 as well as other residents
of areas also affected by the mining activities of WMCP.69 These petitioners have standing to raise the
constitutionality of the questioned FTAA as they allege a personal and substantial injury. They claim that they
would suffer "irremediable displacement"70 as a result of the implementation of the FTAA allowing WMCP to
conduct mining activities in their area of residence. They thus meet the appropriate case requirement as they
assert an interest adverse to that of respondents who, on the other hand, insist on the FTAA's validity.
In view of the alleged impending injury, petitioners also have standing to assail the validity of E.O. No. 279, by
authority of which the FTAA was executed.
Public respondents maintain that petitioners, being strangers to the FTAA, cannot sue either or both
contracting parties to annul it.71 In other words, they contend that petitioners are not real parties in interest
in an action for the annulment of contract.
Public respondents' contention fails. The present action is not merely one for annulment of contract but for
prohibition and mandamus. Petitioners allege that public respondents acted without or in excess of jurisdiction
in implementing the FTAA, which they submit is unconstitutional. As the case involves constitutional questions,
this Court is not concerned with whether petitioners are real parties in interest, but with whether they have
legal standing. As held in Kilosbayan v. Morato:72
x x x. "It is important to note . . . that standing because of its constitutional and public policy underpinnings, is
very different from questions relating to whether a particular plaintiff is the real party in interest or has
capacity to sue. Although all three requirements are directed towards ensuring that only certain parties can
maintain an action, standing restrictions require a partial consideration of the merits, as well as broader policy
concerns relating to the proper role of the judiciary in certain areas.["] (FRIEDENTHAL, KANE AND MILLER,
CIVIL PROCEDURE 328 [1985])
Standing is a special concern in constitutional law because in some cases suits are brought not by parties who
have been personally injured by the operation of a law or by official action taken, but by concerned citizens,
taxpayers or voters who actually sue in the public interest. Hence, the question in standing is whether such
parties have "alleged such a personal stake in the outcome of the controversy as to assure that concrete
adverseness which sharpens the presentation of issues upon which the court so largely depends for
illumination of difficult constitutional questions." (Baker v. Carr, 369 U.S. 186, 7 L.Ed.2d 633 [1962].)
As earlier stated, petitioners meet this requirement.
The challenge against the constitutionality of R.A. No. 7942 and DAO No. 96-40 likewise fulfills the requisites
of justiciability. Although these laws were not in force when the subject FTAA was entered into, the question
as to their validity is ripe for adjudication.
The WMCP FTAA provides:
14.3 Future Legislation
Any term and condition more favourable to Financial &Technical Assistance Agreement contractors resulting
from repeal or amendment of any existing law or regulation or from the enactment of a law, regulation or
administrative order shall be considered a part of this Agreement.
It is undisputed that R.A. No. 7942 and DAO No. 96-40 contain provisions that are more favorable to WMCP,
hence, these laws, to the extent that they are favorable to WMCP, govern the FTAA.
In addition, R.A. No. 7942 explicitly makes certain provisions apply to pre-existing agreements.
SEC. 112. Non-impairment of Existing Mining/Quarrying Rights. – x x x That the provisions of Chapter XIV on
government share in mineral production-sharing agreement and of Chapter XVI on incentives of this Act shall
immediately govern and apply to a mining lessee or contractor unless the mining lessee or contractor indicates
his intention to the secretary, in writing, not to avail of said provisions x x x 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.
As there is no suggestion that WMCP has indicated its intention not to avail of the provisions of Chapter XVI of
R.A. No. 7942, it can safely be presumed that they apply to the WMCP FTAA.
Misconstruing the application of the third requisite for judicial review – that the exercise of the review is
pleaded at the earliest opportunity – WMCP points out that the petition was filed only almost two years after
the execution of the FTAA, hence, not raised at the earliest opportunity.
The third requisite should not be taken to mean that the question of constitutionality must be raised
immediately after the execution of the state action complained of. That the question of constitutionality has
not been raised before is not a valid reason for refusing to allow it to be raised later.73 A contrary rule would
mean that a law, otherwise unconstitutional, would lapse into constitutionality by the mere failure of the
proper party to promptly file a case to challenge the same.
PROPRIETY OF PROHIBITION AND MANDAMUS
Before the effectivity in July 1997 of the Revised Rules of Civil Procedure, Section 2 of Rule 65 read:
SEC. 2. Petition for prohibition. – When the proceedings of any tribunal, corporation, board, or person,
whether exercising functions judicial or ministerial, are without or in excess of its or his jurisdiction, or with
grave abuse of discretion, and there is no appeal or any other plain, speedy, and adequate remedy in the
ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court alleging the
facts with certainty and praying that judgment be rendered commanding the defendant to desist from further
proceeding in the action or matter specified therein.
Prohibition is a preventive remedy.74 It seeks a judgment ordering the defendant to desist from continuing
with the commission of an act perceived to be illegal.75
The petition for prohibition at bar is thus an appropriate remedy. While the execution of the contract itself may
be fait accompli, its implementation is not. Public respondents, in behalf of the Government, have obligations
to fulfill under said contract. Petitioners seek to prevent them from fulfilling such obligations on the theory that
the contract is unconstitutional and, therefore, void.
The propriety of a petition for prohibition being upheld, discussion of the propriety of the mandamus aspect of
the petition is rendered unnecessary.
HIERARCHY OF COURTS
The contention that the filing of this petition violated the rule on hierarchy of courts does not likewise lie. The
rule has been explained thus:
Between two courts of concurrent original jurisdiction, it is the lower court that should initially pass upon the
issues of a case. That way, as a particular case goes through the hierarchy of courts, it is shorn of all but the
important legal issues or those of first impression, which are the proper subject of attention of the appellate
court. This is a procedural rule borne of experience and adopted to improve the administration of justice.
This Court has consistently enjoined litigants to respect the hierarchy of courts. Although this Court has
concurrent jurisdiction with the Regional Trial Courts and the Court of Appeals to issue writs of certiorari,
prohibition, mandamus, quo warranto, habeas corpus and injunction, such concurrence does not give a party
unrestricted freedom of choice of court forum. The resort to this Court's primary jurisdiction to issue said writs
shall be allowed only where the redress desired cannot be obtained in the appropriate courts or where
exceptional and compelling circumstances justify such invocation. We held in People v. Cuaresma that:
A becoming regard for judicial hierarchy most certainly indicates that petitions for the issuance of
extraordinary writs against first level ("inferior") courts should be filed with the Regional Trial Court, and those
against the latter, with the Court of Appeals. A direct invocation of the Supreme Court's original jurisdiction to
issue these writs should be allowed only where there are special and important reasons therefor, clearly and
specifically set out in the petition. This is established policy. It is a policy necessary to prevent inordinate
demands upon the Court's time and attention which are better devoted to those matters within its exclusive
jurisdiction, and to prevent further over-crowding of the Court's docket x x x.76 [Emphasis supplied.]
The repercussions of the issues in this case on the Philippine mining industry, if not the national economy, as
well as the novelty thereof, constitute exceptional and compelling circumstances to justify resort to this Court
in the first instance.
In all events, this Court has the discretion to take cognizance of a suit which does not satisfy the requirements
of an actual case or legal standing when paramount public interest is involved.77 When the issues raised are
of paramount importance to the public, this Court may brush aside technicalities of procedure.78
II
Petitioners contend that E.O. No. 279 did not take effect because its supposed date of effectivity came after
President Aquino had already lost her legislative powers under the Provisional Constitution.
And they likewise claim that the WMC FTAA, which was entered into pursuant to E.O. No. 279, violates Section
2, Article XII of the Constitution because, among other reasons:
(1) It allows foreign-owned companies to extend more than mere financial or technical assistance to the State
in the exploitation, development, and utilization of minerals, petroleum, and other mineral oils, and even
permits foreign owned companies to "operate and manage mining activities."
(2) It allows foreign-owned companies to extend both technical and financial assistance, instead of "either
technical or financial assistance."
To appreciate the import of these issues, a visit to the history of the pertinent constitutional provision, the
concepts contained therein, and the laws enacted pursuant thereto, is in order.
Section 2, Article XII reads in full:
Sec. 2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned
by the State. With the exception of agricultural lands, all other natural resources shall not be alienated. The
exploration, development, and utilization of natural resources shall be under the full control and supervision of
the State. The State may directly undertake such activities or it may enter into co-production, joint venture, or
production-sharing agreements with Filipino citizens, or corporations or associations at least sixty per centum
of whose capital is owned by such citizens. Such agreements may be for a period not exceeding twenty-five
years, renewable for not more than twenty-five years, and under such terms and conditions as may be
provided by law. In cases of water rights for irrigation, water supply, fisheries, or industrial uses other than the
development of water power, beneficial use may be the measure and limit of the grant.
The State shall protect the nation's marine wealth in its archipelagic waters, territorial sea, and exclusive
economic zone, and reserve its use and enjoyment exclusively to Filipino citizens.
The Congress may, by law, allow small-scale utilization of natural resources by Filipino citizens, as well as
cooperative fish farming, with priority to subsistence fishermen and fish-workers in rivers, lakes, bays, and
lagoons.
The President may enter into agreements with foreign-owned corporations involving either technical or
financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other
mineral oils according to the general terms and conditions provided by law, based on real contributions to the
economic growth and general welfare of the country. In such agreements, the State shall promote the
development and use of local scientific and technical resources.
The President shall notify the Congress of every contract entered into in accordance with this provision, within
thirty days from its execution.
THE SPANISH REGIME AND THE REGALIAN DOCTRINE
The first sentence of Section 2 embodies the Regalian doctrine or jura regalia. Introduced by Spain into these
Islands, this feudal concept is based on the State's power of dominium, which is the capacity of the State to
own or acquire property.79
In its broad sense, the term "jura regalia" refers to royal rights, or those rights which the King has by virtue of
his prerogatives. In Spanish law, it refers to a right which the sovereign has over anything in which a subject
has a right of property or propriedad. These were rights enjoyed during feudal times by the king as the
sovereign.
The theory of the feudal system was that title to all lands was originally held by the King, and while the use of
lands was granted out to others who were permitted to hold them under certain conditions, the King
theoretically retained the title. By fiction of law, the King was regarded as the original proprietor of all lands,
and the true and only source of title, and from him all lands were held. The theory of jura regalia was
therefore nothing more than a natural fruit of conquest.80
The Philippines having passed to Spain by virtue of discovery and conquest,81 earlier Spanish decrees
declared that "all lands were held from the Crown."82
The Regalian doctrine extends not only to land but also to "all natural wealth that may be found in the bowels
of the earth."83 Spain, in particular, recognized the unique value of natural resources, viewing them,
especially minerals, as an abundant source of revenue to finance its wars against other nations.84 Mining laws
during the Spanish regime reflected this perspective.85
THE AMERICAN OCCUPATION AND THE CONCESSION REGIME
By the Treaty of Paris of December 10, 1898, Spain ceded "the archipelago known as the Philippine Islands" to
the United States. The Philippines was hence governed by means of organic acts that were in the nature of
charters serving as a Constitution of the occupied territory from 1900 to 1935.86 Among the principal organic
acts of the Philippines was the Act of Congress of July 1, 1902, more commonly known as the Philippine Bill of
1902, through which the United States Congress assumed the administration of the Philippine Islands.87
Section 20 of said Bill reserved the disposition of mineral lands of the public domain from sale. Section 21
thereof allowed the free and open exploration, occupation and purchase of mineral deposits not only to
citizens of the Philippine Islands but to those of the United States as well:
Sec. 21. That all valuable mineral deposits in public lands in the Philippine Islands, both surveyed and
unsurveyed, are hereby declared to be free and open to exploration, occupation and purchase, and the land in
which they are found, to occupation and purchase, by citizens of the United States or of said Islands:
Provided, That when on any lands in said Islands entered and occupied as agricultural lands under the
provisions of this Act, but not patented, mineral deposits have been found, the working of such mineral
deposits is forbidden until the person, association, or corporation who or which has entered and is occupying
such lands shall have paid to the Government of said Islands such additional sum or sums as will make the
total amount paid for the mineral claim or claims in which said deposits are located equal to the amount
charged by the Government for the same as mineral claims.
Unlike Spain, the United States considered natural resources as a source of wealth for its nationals and saw fit
to allow both Filipino and American citizens to explore and exploit minerals in public lands, and to grant
patents to private mineral lands.88 A person who acquired ownership over a parcel of private mineral land
pursuant to the laws then prevailing could exclude other persons, even the State, from exploiting minerals
within his property.89 Thus, earlier jurisprudence90 held that:
A valid and subsisting location of mineral land, made and kept up in accordance with the provisions of the
statutes of the United States, has the effect of a grant by the United States of the present and exclusive
possession of the lands located, and this exclusive right of possession and enjoyment continues during the
entire life of the location. x x x.
x x x.
The discovery of minerals in the ground by one who has a valid mineral location perfects his claim and his
location not only against third persons, but also against the Government. x x x. [Italics in the original.]
The Regalian doctrine and the American system, therefore, differ in one essential respect. Under the Regalian
theory, mineral rights are not included in a grant of land by the state; under the American doctrine, mineral
rights are included in a grant of land by the government.91
Section 21 also made possible the concession (frequently styled "permit", license" or "lease")92 system.93 This
was the traditional regime imposed by the colonial administrators for the exploitation of natural resources in
the extractive sector (petroleum, hard minerals, timber, etc.).94
Under the concession system, the concessionaire makes a direct equity investment for the purpose of
exploiting a particular natural resource within a given area.95 Thus, the concession amounts to complete
control by the concessionaire over the country's natural resource, for it is given exclusive and plenary rights to
exploit a particular resource at the point of extraction.96 In consideration for the right to exploit a natural
resource, the concessionaire either pays rent or royalty, which is a fixed percentage of the gross proceeds.97
Later statutory enactments by the legislative bodies set up in the Philippines adopted the contractual
framework of the concession.98 For instance, Act No. 2932,99 approved on August 31, 1920, which provided
for the exploration, location, and lease of lands containing petroleum and other mineral oils and gas in the
Philippines, and Act No. 2719,100 approved on May 14, 1917, which provided for the leasing and development
of coal lands in the Philippines, both utilized the concession system.101
THE 1935 CONSTITUTION AND THE NATIONALIZATION OF NATURAL RESOURCES
By the Act of United States Congress of March 24, 1934, popularly known as the Tydings-McDuffie Law, the
People of the Philippine Islands were authorized to adopt a constitution.102 On July 30, 1934, the
Constitutional Convention met for the purpose of drafting a constitution, and the Constitution subsequently
drafted was approved by the Convention on February 8, 1935.103 The Constitution was submitted to the
President of the United States on March 18, 1935.104 On March 23, 1935, the President of the United States
certified that the Constitution conformed substantially with the provisions of the Act of Congress approved on
March 24, 1934.105 On May 14, 1935, the Constitution was ratified by the Filipino people.106
The 1935 Constitution adopted the Regalian doctrine, declaring all natural resources of the Philippines,
including mineral lands and minerals, to be property belonging to the State.107 As adopted in a republican
system, the medieval concept of jura regalia is stripped of royal overtones and ownership of the land is vested
in the State.108
Section 1, Article XIII, on Conservation and Utilization of Natural Resources, of the 1935 Constitution provided:
SECTION 1. All agricultural, timber, and mineral lands of the public domain, waters, minerals, coal, petroleum,
and other mineral oils, all forces of potential energy, and other natural resources of the Philippines belong to
the State, and their disposition, exploitation, development, or utilization shall be limited to citizens of the
Philippines, or to corporations or associations at least sixty per centum of the capital of which is owned by
such citizens, subject to any existing right, grant, lease, or concession at the time of the inauguration of the
Government established under this Constitution. Natural resources, with the exception of public agricultural
land, shall not be alienated, and no license, concession, or lease for the exploitation, development, or
utilization of any of the natural resources shall be granted for a period exceeding twenty-five years, except as
to water rights for irrigation, water supply, fisheries, or industrial uses other than the development of water
power, in which cases beneficial use may be the measure and the limit of the grant.
The nationalization and conservation of the natural resources of the country was one of the fixed and
dominating objectives of the 1935 Constitutional Convention.109 One delegate relates:
There was an overwhelming sentiment in the Convention in favor of the principle of state ownership of natural
resources and the adoption of the Regalian doctrine. State ownership of natural resources was seen as a
necessary starting point to secure recognition of the state's power to control their disposition, exploitation,
development, or utilization. The delegates of the Constitutional Convention very well knew that the concept of
State ownership of land and natural resources was introduced by the Spaniards, however, they were not
certain whether it was continued and applied by the Americans. To remove all doubts, the Convention
approved the provision in the Constitution affirming the Regalian doctrine.
The adoption of the principle of state ownership of the natural resources and of the Regalian doctrine was
considered to be a necessary starting point for the plan of nationalizing and conserving the natural resources
of the country. For with the establishment of the principle of state ownership of the natural resources, it would
not be hard to secure the recognition of the power of the State to control their disposition, exploitation,
development or utilization.110
The nationalization of the natural resources was intended (1) to insure their conservation for Filipino posterity;
(2) to serve as an instrument of national defense, helping prevent the extension to the country of foreign
control through peaceful economic penetration; and (3) to avoid making the Philippines a source of
international conflicts with the consequent danger to its internal security and independence.111
The same Section 1, Article XIII also adopted the concession system, expressly permitting the State to grant
licenses, concessions, or leases for the exploitation, development, or utilization of any of the natural resources.
Grants, however, were limited to Filipinos or entities at least 60% of the capital of which is owned by
Filipinos.lawph!l.ne+
The swell of nationalism that suffused the 1935 Constitution was radically diluted when on November 1946,
the Parity Amendment, which came in the form of an "Ordinance Appended to the Constitution," was ratified
in a plebiscite.112 The Amendment extended, from July 4, 1946 to July 3, 1974, the right to utilize and exploit
our natural resources to citizens of the United States and business enterprises owned or controlled, directly or
indirectly, by citizens of the United States:113
Notwithstanding the provision of section one, Article Thirteen, and section eight, Article Fourteen, of the
foregoing Constitution, during the effectivity of the Executive Agreement entered into by the President of the
Philippines with the President of the United States on the fourth of July, nineteen hundred and forty-six,
pursuant to the provisions of Commonwealth Act Numbered Seven hundred and thirty-three, but in no case to
extend beyond the third of July, nineteen hundred and seventy-four, the disposition, exploitation,
development, and utilization of all agricultural, timber, and mineral lands of the public domain, waters,
minerals, coals, petroleum, and other mineral oils, all forces and sources of potential energy, and other natural
resources of the Philippines, and the operation of public utilities, shall, if open to any person, be open to
citizens of the United States and to all forms of business enterprise owned or controlled, directly or indirectly,
by citizens of the United States in the same manner as to, and under the same conditions imposed upon,
citizens of the Philippines or corporations or associations owned or controlled by citizens of the Philippines.
The Parity Amendment was subsequently modified by the 1954 Revised Trade Agreement, also known as the
Laurel-Langley Agreement, embodied in Republic Act No. 1355.114
THE PETROLEUM ACT OF 1949 AND THE CONCESSION SYSTEM
In the meantime, Republic Act No. 387,115 also known as the Petroleum Act of 1949, was approved on June
18, 1949.
The Petroleum Act of 1949 employed the concession system for the exploitation of the nation's petroleum
resources. Among the kinds of concessions it sanctioned were exploration and exploitation concessions, which
respectively granted to the concessionaire the exclusive right to explore for116 or develop117 petroleum
within specified areas.
Concessions may be granted only to duly qualified persons118 who have sufficient finances, organization,
resources, technical competence, and skills necessary to conduct the operations to be undertaken.119
Nevertheless, the Government reserved the right to undertake such work itself.120 This proceeded from the
theory that all natural deposits or occurrences of petroleum or natural gas in public and/or private lands in the
Philippines belong to the State.121 Exploration and exploitation concessions did not confer upon the
concessionaire ownership over the petroleum lands and petroleum deposits.122 However, they did grant
concessionaires the right to explore, develop, exploit, and utilize them for the period and under the conditions
determined by the law.123
Concessions were granted at the complete risk of the concessionaire; the Government did not guarantee the
existence of petroleum or undertake, in any case, title warranty.124
Concessionaires were required to submit information as maybe required by the Secretary of Agriculture and
Natural Resources, including reports of geological and geophysical examinations, as well as production
reports.125 Exploration126 and exploitation127 concessionaires were also required to submit work
programs.lavvphi1.net
Exploitation concessionaires, in particular, were obliged to pay an annual exploitation tax,128 the object of
which is to induce the concessionaire to actually produce petroleum, and not simply to sit on the concession
without developing or exploiting it.129 These concessionaires were also bound to pay the Government royalty,
which was not less than 12½% of the petroleum produced and saved, less that consumed in the operations of
the concessionaire.130 Under Article 66, R.A. No. 387, the exploitation tax may be credited against the
royalties so that if the concessionaire shall be actually producing enough oil, it would not actually be paying
the exploitation tax.131
Failure to pay the annual exploitation tax for two consecutive years,132 or the royalty due to the Government
within one year from the date it becomes due,133 constituted grounds for the cancellation of the concession.
In case of delay in the payment of the taxes or royalty imposed by the law or by the concession, a surcharge
of 1% per month is exacted until the same are paid.134
As a rule, title rights to all equipment and structures that the concessionaire placed on the land belong to the
exploration or exploitation concessionaire.135 Upon termination of such concession, the concessionaire had a
right to remove the same.136
The Secretary of Agriculture and Natural Resources was tasked with carrying out the provisions of the law,
through the Director of Mines, who acted under the Secretary's immediate supervision and control.137 The Act
granted the Secretary the authority to inspect any operation of the concessionaire and to examine all the
books and accounts pertaining to operations or conditions related to payment of taxes and royalties.138
The same law authorized the Secretary to create an Administration Unit and a Technical Board.139 The
Administration Unit was charged, inter alia, with the enforcement of the provisions of the law.140 The
Technical Board had, among other functions, the duty to check on the performance of concessionaires and to
determine whether the obligations imposed by the Act and its implementing regulations were being complied
with.141
Victorio Mario A. Dimagiba, Chief Legal Officer of the Bureau of Energy Development, analyzed the benefits
and drawbacks of the concession system insofar as it applied to the petroleum industry:
Advantages of Concession. Whether it emphasizes income tax or royalty, the most positive aspect of the
concession system is that the State's financial involvement is virtually risk free and administration is simple and
comparatively low in cost. Furthermore, if there is a competitive allocation of the resource leading to
substantial bonuses and/or greater royalty coupled with a relatively high level of taxation, revenue accruing to
the State under the concession system may compare favorably with other financial arrangements.
Disadvantages of Concession. There are, however, major negative aspects to this system. Because the
Government's role in the traditional concession is passive, it is at a distinct disadvantage in managing and
developing policy for the nation's petroleum resource. This is true for several reasons. First, even though most
concession agreements contain covenants requiring diligence in operations and production, this establishes
only an indirect and passive control of the host country in resource development. Second, and more
importantly, the fact that the host country does not directly participate in resource management decisions
inhibits its ability to train and employ its nationals in petroleum development. This factor could delay or
prevent the country from effectively engaging in the development of its resources. Lastly, a direct role in
management is usually necessary in order to obtain a knowledge of the international petroleum industry which
is important to an appreciation of the host country's resources in relation to those of other countries.142
Other liabilities of the system have also been noted:
x x x there are functional implications which give the concessionaire great economic power arising from its
exclusive equity holding. This includes, first, appropriation of the returns of the undertaking, subject to a
modest royalty; second, exclusive management of the project; third, control of production of the natural
resource, such as volume of production, expansion, research and development; and fourth, exclusive
responsibility for downstream operations, like processing, marketing, and distribution. In short, even if
nominally, the state is the sovereign and owner of the natural resource being exploited, it has been shorn of
all elements of control over such natural resource because of the exclusive nature of the contractual regime of
the concession. The concession system, investing as it does ownership of natural resources, constitutes a
consistent inconsistency with the principle embodied in our Constitution that natural resources belong to the
state and shall not be alienated, not to mention the fact that the concession was the bedrock of the colonial
system in the exploitation of natural resources.143
Eventually, the concession system failed for reasons explained by Dimagiba:
Notwithstanding the good intentions of the Petroleum Act of 1949, the concession system could not have
properly spurred sustained oil exploration activities in the country, since it assumed that such a capital-
intensive, high risk venture could be successfully undertaken by a single individual or a small company. In
effect, concessionaires' funds were easily exhausted. Moreover, since the concession system practically closed
its doors to interested foreign investors, local capital was stretched to the limits. The old system also failed to
consider the highly sophisticated technology and expertise required, which would be available only to
multinational companies.144
A shift to a new regime for the development of natural resources thus seemed imminent.
PRESIDENTIAL DECREE NO. 87, THE 1973 CONSTITUTION AND THE SERVICE CONTRACT SYSTEM
The promulgation on December 31, 1972 of Presidential Decree No. 87,145 otherwise known as The Oil
Exploration and Development Act of 1972 signaled such a transformation. P.D. No. 87 permitted the
government to explore for and produce indigenous petroleum through "service contracts."146
"Service contracts" is a term that assumes varying meanings to different people, and it has carried many
names in different countries, like "work contracts" in Indonesia, "concession agreements" in Africa,
"production-sharing agreements" in the Middle East, and "participation agreements" in Latin America.147 A
functional definition of "service contracts" in the Philippines is provided as follows:
A service contract is a contractual arrangement for engaging in the exploitation and development of
petroleum, mineral, energy, land and other natural resources by which a government or its agency, or a
private person granted a right or privilege by the government authorizes the other party (service contractor) to
engage or participate in the exercise of such right or the enjoyment of the privilege, in that the latter provides
financial or technical resources, undertakes the exploitation or production of a given resource, or directly
manages the productive enterprise, operations of the exploration and exploitation of the resources or the
disposition of marketing or resources.148
In a service contract under P.D. No. 87, service and technology are furnished by the service contractor for
which it shall be entitled to the stipulated service fee.149 The contractor must be technically competent and
financially capable to undertake the operations required in the contract.150
Financing is supposed to be provided by the Government to which all petroleum produced belongs.151 In case
the Government is unable to finance petroleum exploration operations, the contractor may furnish services,
technology and financing, and the proceeds of sale of the petroleum produced under the contract shall be the
source of funds for payment of the service fee and the operating expenses due the contractor.152 The
contractor shall undertake, manage and execute petroleum operations, subject to the government overseeing
the management of the operations.153 The contractor provides all necessary services and technology and the
requisite financing, performs the exploration work obligations, and assumes all exploration risks such that if no
petroleum is produced, it will not be entitled to reimbursement.154 Once petroleum in commercial quantity is
discovered, the contractor shall operate the field on behalf of the government.155
P.D. No. 87 prescribed minimum terms and conditions for every service contract.156 It also granted the
contractor certain privileges, including exemption from taxes and payment of tariff duties,157 and permitted
the repatriation of capital and retention of profits abroad.158
Ostensibly, the service contract system had certain advantages over the concession regime.159 It has been
opined, though, that, in the Philippines, our concept of a service contract, at least in the petroleum industry,
was basically a concession regime with a production-sharing element.160
On January 17, 1973, then President Ferdinand E. Marcos proclaimed the ratification of a new Constitution.161
Article XIV on the National Economy and Patrimony contained provisions similar to the 1935 Constitution with
regard to Filipino participation in the nation's natural resources. Section 8, Article XIV thereof provides:
Sec. 8. All lands of the public domain, waters, minerals, coal, petroleum and other mineral oils, all forces of
potential energy, fisheries, wildlife, and other natural resources of the Philippines belong to the State. With the
exception of agricultural, industrial or commercial, residential and resettlement lands of the public domain,
natural resources shall not be alienated, and no license, concession, or lease for the exploration, development,
exploitation, or utilization of any of the natural resources shall be granted for a period exceeding twenty-five
years, renewable for not more than twenty-five years, except as to water rights for irrigation, water supply,
fisheries, or industrial uses other than the development of water power, in which cases beneficial use may be
the measure and the limit of the grant.
While Section 9 of the same Article maintained the Filipino-only policy in the enjoyment of natural resources, it
also allowed Filipinos, upon authority of the Batasang Pambansa, to enter into service contracts with any
person or entity for the exploration or utilization of natural resources.
Sec. 9. The disposition, exploration, development, exploitation, or utilization of any of the natural resources of
the Philippines shall be limited to citizens, or to corporations or associations at least sixty per centum of which
is owned by such citizens. The Batasang Pambansa, in the national interest, may allow such citizens,
corporations or associations to enter into service contracts for financial, technical, management, or other
forms of assistance with any person or entity for the exploration, or utilization of any of the natural resources.
Existing valid and binding service contracts for financial, technical, management, or other forms of assistance
are hereby recognized as such. [Emphasis supplied.]
The concept of service contracts, according to one delegate, was borrowed from the methods followed by
India, Pakistan and especially Indonesia in the exploration of petroleum and mineral oils.162 The provision
allowing such contracts, according to another, was intended to "enhance the proper development of our
natural resources since Filipino citizens lack the needed capital and technical know-how which are essential in
the proper exploration, development and exploitation of the natural resources of the country."163
The original idea was to authorize the government, not private entities, to enter into service contracts with
foreign entities.164 As finally approved, however, a citizen or private entity could be allowed by the National
Assembly to enter into such service contract.165 The prior approval of the National Assembly was deemed
sufficient to protect the national interest.166 Notably, none of the laws allowing service contracts were passed
by the Batasang Pambansa. Indeed, all of them were enacted by presidential decree.
On March 13, 1973, shortly after the ratification of the new Constitution, the President promulgated
Presidential Decree No. 151.167 The law allowed Filipino citizens or entities which have acquired lands of the
public domain or which own, hold or control such lands to enter into service contracts for financial, technical,
management or other forms of assistance with any foreign persons or entity for the exploration, development,
exploitation or utilization of said lands.168
Presidential Decree No. 463,169 also known as The Mineral Resources Development Decree of 1974, was
enacted on May 17, 1974. Section 44 of the decree, as amended, provided that a lessee of a mining claim may
enter into a service contract with a qualified domestic or foreign contractor for the exploration, development
and exploitation of his claims and the processing and marketing of the product thereof.
Presidential Decree No. 704170 (The Fisheries Decree of 1975), approved on May 16, 1975, allowed Filipinos
engaged in commercial fishing to enter into contracts for financial, technical or other forms of assistance with
any foreign person, corporation or entity for the production, storage, marketing and processing of fish and
fishery/aquatic products.171
Presidential Decree No. 705172 (The Revised Forestry Code of the Philippines), approved on May 19, 1975,
allowed "forest products licensees, lessees, or permitees to enter into service contracts for financial, technical,
management, or other forms of assistance . . . with any foreign person or entity for the exploration,
development, exploitation or utilization of the forest resources."173
Yet another law allowing service contracts, this time for geothermal resources, was Presidential Decree No.
1442,174 which was signed into law on June 11, 1978. Section 1 thereof authorized the Government to enter
into service contracts for the exploration, exploitation and development of geothermal resources with a foreign
contractor who must be technically and financially capable of undertaking the operations required in the
service contract.
Thus, virtually the entire range of the country's natural resources –from petroleum and minerals to geothermal
energy, from public lands and forest resources to fishery products – was well covered by apparent legal
authority to engage in the direct participation or involvement of foreign persons or corporations (otherwise
disqualified) in the exploration and utilization of natural resources through service contracts.175
THE 1987 CONSTITUTION AND TECHNICAL OR FINANCIAL ASSISTANCE AGREEMENTS
After the February 1986 Edsa Revolution, Corazon C. Aquino took the reins of power under a revolutionary
government. On March 25, 1986, President Aquino issued Proclamation No. 3,176 promulgating the Provisional
Constitution, more popularly referred to as the Freedom Constitution. By authority of the same Proclamation,
the President created a Constitutional Commission (CONCOM) to draft a new constitution, which took effect on
the date of its ratification on February 2, 1987.177
The 1987 Constitution retained the Regalian doctrine. The first sentence of Section 2, Article XII states: "All
lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential
energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned by the
State."
Like the 1935 and 1973 Constitutions before it, the 1987 Constitution, in the second sentence of the same
provision, prohibits the alienation of natural resources, except agricultural lands.
The third sentence of the same paragraph is new: "The exploration, development and utilization of natural
resources shall be under the full control and supervision of the State." The constitutional policy of the State's
"full control and supervision" over natural resources proceeds from the concept of jura regalia, as well as the
recognition of the importance of the country's natural resources, not only for national economic development,
but also for its security and national defense.178 Under this provision, the State assumes "a more dynamic
role" in the exploration, development and utilization of natural resources.179
Conspicuously absent in Section 2 is the provision in the 1935 and 1973 Constitutions authorizing the State to
grant licenses, concessions, or leases for the exploration, exploitation, development, or utilization of natural
resources. By such omission, the utilization of inalienable lands of public domain through "license, concession
or lease" is no longer allowed under the 1987 Constitution.180
Having omitted the provision on the concession system, Section 2 proceeded to introduce "unfamiliar
language":181
The State may directly undertake such activities or it may enter into co-production, joint venture, or
production-sharing agreements with Filipino citizens, or corporations or associations at least sixty per centum
of whose capital is owned by such citizens.
Consonant with the State's "full supervision and control" over natural resources, Section 2 offers the State two
"options."182 One, the State may directly undertake these activities itself; or two, it may enter into co-
production, joint venture, or production-sharing agreements with Filipino citizens, or entities at least 60% of
whose capital is owned by such citizens.
A third option is found in the third paragraph of the same section:
The Congress may, by law, allow small-scale utilization of natural resources by Filipino citizens, as well as
cooperative fish farming, with priority to subsistence fishermen and fish-workers in rivers, lakes, bays, and
lagoons.
While the second and third options are limited only to Filipino citizens or, in the case of the former, to
corporations or associations at least 60% of the capital of which is owned by Filipinos, a fourth allows the
participation of foreign-owned corporations. The fourth and fifth paragraphs of Section 2 provide:
The President may enter into agreements with foreign-owned corporations involving either technical or
financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other
mineral oils according to the general terms and conditions provided by law, based on real contributions to the
economic growth and general welfare of the country. In such agreements, the State shall promote the
development and use of local scientific and technical resources.
The President shall notify the Congress of every contract entered into in accordance with this provision, within
thirty days from its execution.
Although Section 2 sanctions the participation of foreign-owned corporations in the exploration, development,
and utilization of natural resources, it imposes certain limitations or conditions to agreements with such
corporations.
First, the parties to FTAAs. Only the President, in behalf of the State, may enter into these agreements, and
only with corporations. By contrast, under the 1973 Constitution, a Filipino citizen, corporation or association
may enter into a service contract with a "foreign person or entity."
Second, the size of the activities: only large-scale exploration, development, and utilization is allowed. The
term "large-scale usually refers to very capital-intensive activities."183
Third, the natural resources subject of the activities is restricted to minerals, petroleum and other mineral oils,
the intent being to limit service contracts to those areas where Filipino capital may not be sufficient.184
Fourth, consistency with the provisions of statute. The agreements must be in accordance with the terms and
conditions provided by law.
Fifth, Section 2 prescribes certain standards for entering into such agreements. The agreements must be
based on real contributions to economic growth and general welfare of the country.
Sixth, the agreements must contain rudimentary stipulations for the promotion of the development and use of
local scientific and technical resources.
Seventh, the notification requirement. The President shall notify Congress of every financial or technical
assistance agreement entered into within thirty days from its execution.
Finally, the scope of the agreements. While the 1973 Constitution referred to "service contracts for financial,
technical, management, or other forms of assistance" the 1987 Constitution provides for "agreements. . .
involving either financial or technical assistance." It bears noting that the phrases "service contracts" and
"management or other forms of assistance" in the earlier constitution have been omitted.
By virtue of her legislative powers under the Provisional Constitution,185 President Aquino, on July 10, 1987,
signed into law E.O. No. 211 prescribing the interim procedures in the processing and approval of applications
for the exploration, development and utilization of minerals. The omission in the 1987 Constitution of the term
"service contracts" notwithstanding, the said E.O. still referred to them in Section 2 thereof:
Sec. 2. Applications for the exploration, development and utilization of mineral resources, including renewal
applications and applications for approval of operating agreements and mining service contracts, shall be
accepted and processed and may be approved x x x. [Emphasis supplied.]
The same law provided in its Section 3 that the "processing, evaluation and approval of all mining applications
. . . operating agreements and service contracts . . . shall be governed by Presidential Decree No. 463, as
amended, other existing mining laws, and their implementing rules and regulations. . . ."
As earlier stated, on the 25th also of July 1987, the President issued E.O. No. 279 by authority of which the
subject WMCP FTAA was executed on March 30, 1995.
On March 3, 1995, President Ramos signed into law R.A. No. 7942. Section 15 thereof declares that the Act
"shall govern the exploration, development, utilization, and processing of all mineral resources." Such
declaration notwithstanding, R.A. No. 7942 does not actually cover all the modes through which the State may
undertake the exploration, development, and utilization of natural resources.
The State, being the owner of the natural resources, is accorded the primary power and responsibility in the
exploration, development and utilization thereof. As such, it may undertake these activities through four
modes:
The State may directly undertake such activities.
(2) The State may enter into co-production, joint venture or production-sharing agreements with Filipino
citizens or qualified corporations.
(3) Congress may, by law, allow small-scale utilization of natural resources by Filipino citizens.
(4) For the large-scale exploration, development and utilization of minerals, petroleum and other mineral oils,
the President may enter into agreements with foreign-owned corporations involving technical or financial
assistance.186
Except to charge the Mines and Geosciences Bureau of the DENR with performing researches and surveys,187
and a passing mention of government-owned or controlled corporations,188 R.A. No. 7942 does not specify
how the State should go about the first mode. The third mode, on the other hand, is governed by Republic Act
No. 7076189 (the People's Small-Scale Mining Act of 1991) and other pertinent laws.190 R.A. No. 7942
primarily concerns itself with the second and fourth modes.
Mineral production sharing, co-production and joint venture agreements are collectively classified by R.A. No.
7942 as "mineral agreements."191 The Government participates the least in a mineral production sharing
agreement (MPSA). In an MPSA, the Government grants the contractor192 the exclusive right to conduct
mining operations within a contract area193 and shares in the gross output.194 The MPSA contractor provides
the financing, technology, management and personnel necessary for the agreement's implementation.195 The
total government share in an MPSA is the excise tax on mineral products under Republic Act No. 7729,196
amending Section 151(a) of the National Internal Revenue Code, as amended.197
In a co-production agreement (CA),198 the Government provides inputs to the mining operations other than
the mineral resource,199 while in a joint venture agreement (JVA), where the Government enjoys the greatest
participation, the Government and the JVA contractor organize a company with both parties having equity
shares.200 Aside from earnings in equity, the Government in a JVA is also entitled to a share in the gross
output.201 The Government may enter into a CA202 or JVA203 with one or more contractors. The
Government's share in a CA or JVA is set out in Section 81 of the law:
The share of the Government in co-production and joint venture agreements shall be negotiated by the
Government and the contractor taking into consideration the: (a) capital investment of the project, (b) the
risks involved, (c) contribution of the project to the economy, and (d) other factors that will provide for a fair
and equitable sharing between the Government and the contractor. The Government shall also be entitled to
compensations for its other contributions which shall be agreed upon by the parties, and shall consist, among
other things, the contractor's income tax, excise tax, special allowance, withholding tax due from the
contractor's foreign stockholders arising from dividend or interest payments to the said foreign stockholders, in
case of a foreign national and all such other taxes, duties and fees as provided for under existing laws.
All mineral agreements grant the respective contractors the exclusive right to conduct mining operations and
to extract all mineral resources found in the contract area.204 A "qualified person" may enter into any of the
mineral agreements with the Government.205 A "qualified person" is
any citizen of the Philippines with capacity to contract, or a corporation, partnership, association, or
cooperative organized or authorized for the purpose of engaging in mining, with technical and financial
capability to undertake mineral resources development and duly registered in accordance with law at least
sixty per centum (60%) of the capital of which is owned by citizens of the Philippines x x x.206
The fourth mode involves "financial or technical assistance agreements." An FTAA is defined as "a contract
involving financial or technical assistance for large-scale exploration, development, and utilization of natural
resources."207 Any qualified person with technical and financial capability to undertake large-scale exploration,
development, and utilization of natural resources in the Philippines may enter into such agreement directly
with the Government through the DENR.208 For the purpose of granting an FTAA, a legally organized foreign-
owned corporation (any corporation, partnership, association, or cooperative duly registered in accordance
with law in which less than 50% of the capital is owned by Filipino citizens)209 is deemed a "qualified
person."210
Other than the difference in contractors' qualifications, the principal distinction between mineral agreements
and FTAAs is the maximum contract area to which a qualified person may hold or be granted.211 "Large-
scale" under R.A. No. 7942 is determined by the size of the contract area, as opposed to the amount invested
(US $50,000,000.00), which was the standard under E.O. 279.
Like a CA or a JVA, an FTAA is subject to negotiation.212 The Government's contributions, in the form of
taxes, in an FTAA is identical to its contributions in the two mineral agreements, save that in an FTAA:
The collection of Government share in financial or technical assistance agreement shall commence after the
financial or technical assistance agreement contractor has fully recovered its pre-operating expenses,
exploration, and development expenditures, inclusive.213
III
Having examined the history of the constitutional provision and statutes enacted pursuant thereto, a
consideration of the substantive issues presented by the petition is now in order.
THE EFFECTIVITY OF EXECUTIVE ORDER NO. 279
Petitioners argue that E.O. No. 279, the law in force when the WMC FTAA was executed, did not come into
effect.
E.O. No. 279 was signed into law by then President Aquino on July 25, 1987, two days before the opening of
Congress on July 27, 1987.214 Section 8 of the E.O. states that the same "shall take effect immediately." This
provision, according to petitioners, runs counter to Section 1 of E.O. No. 200,215 which provides:
SECTION 1. Laws shall take effect after fifteen days following the completion of their publication either in the
Official Gazette or in a newspaper of general circulation in the Philippines, unless it is otherwise provided.216
[Emphasis supplied.]
On that premise, petitioners contend that E.O. No. 279 could have only taken effect fifteen days after its
publication at which time Congress had already convened and the President's power to legislate had ceased.
Respondents, on the other hand, counter that the validity of E.O. No. 279 was settled in Miners Association of
the Philippines v. Factoran, supra. This is of course incorrect for the issue in Miners Association was not the
validity of E.O. No. 279 but that of DAO Nos. 57 and 82 which were issued pursuant thereto.
Nevertheless, petitioners' contentions have no merit.
It bears noting that there is nothing in E.O. No. 200 that prevents a law from taking effect on a date other
than – even before – the 15-day period after its publication. Where a law provides for its own date of
effectivity, such date prevails over that prescribed by E.O. No. 200. Indeed, this is the very essence of the
phrase "unless it is otherwise provided" in Section 1 thereof. Section 1, E.O. No. 200, therefore, applies only
when a statute does not provide for its own date of effectivity.
What is mandatory under E.O. No. 200, and what due process requires, as this Court held in Tañada v.
Tuvera,217 is the publication of the law for without such notice and publication, there would be no basis for
the application of the maxim "ignorantia legis n[eminem] excusat." It would be the height of injustice to
punish or otherwise burden a citizen for the transgression of a law of which he had no notice whatsoever, not
even a constructive one.
While the effectivity clause of E.O. No. 279 does not require its publication, it is not a ground for its
invalidation since the Constitution, being "the fundamental, paramount and supreme law of the nation," is
deemed written in the law.218 Hence, the due process clause,219 which, so Tañada held, mandates the
publication of statutes, is read into Section 8 of E.O. No. 279. Additionally, Section 1 of E.O. No. 200 which
provides for publication "either in the Official Gazette or in a newspaper of general circulation in the
Philippines," finds suppletory application. It is significant to note that E.O. No. 279 was actually published in
the Official Gazette220 on August 3, 1987.
From a reading then of Section 8 of E.O. No. 279, Section 1 of E.O. No. 200, and Tañada v. Tuvera, this Court
holds that E.O. No. 279 became effective immediately upon its publication in the Official Gazette on August 3,
1987.
That such effectivity took place after the convening of the first Congress is irrelevant. At the time President
Aquino issued E.O. No. 279 on July 25, 1987, she was still validly exercising legislative powers under the
Provisional Constitution.221 Article XVIII (Transitory Provisions) of the 1987 Constitution explicitly states:
Sec. 6. The incumbent President shall continue to exercise legislative powers until the first Congress is
convened.
The convening of the first Congress merely precluded the exercise of legislative powers by President Aquino; it
did not prevent the effectivity of laws she had previously enacted.
There can be no question, therefore, that E.O. No. 279 is an effective, and a validly enacted, statute.
THE CONSTITUTIONALITY OF THE WMCP FTAA
Petitioners submit that, in accordance with the text of Section 2, Article XII of the Constitution, FTAAs should
be limited to "technical or financial assistance" only. They observe, however, that, contrary to the language of
the Constitution, the WMCP FTAA allows WMCP, a fully foreign-owned mining corporation, to extend more
than mere financial or technical assistance to the State, for it permits WMCP to manage and operate every
aspect of the mining activity. 222
Petitioners' submission is well-taken. It is a cardinal rule in the interpretation of constitutions that the
instrument must be so construed as to give effect to the intention of the people who adopted it.223 This
intention is to be sought in the constitution itself, and the apparent meaning of the words is to be taken as
expressing it, except in cases where that assumption would lead to absurdity, ambiguity, or contradiction.224
What the Constitution says according to the text of the provision, therefore, compels acceptance and negates
the power of the courts to alter it, based on the postulate that the framers and the people mean what they
say.225 Accordingly, following the literal text of the Constitution, assistance accorded by foreign-owned
corporations in the large-scale exploration, development, and utilization of petroleum, minerals and mineral
oils should be limited to "technical" or "financial" assistance only.
WMCP nevertheless submits that the word "technical" in the fourth paragraph of Section 2 of E.O. No. 279
encompasses a "broad number of possible services," perhaps, "scientific and/or technological in basis."226 It
thus posits that it may also well include "the area of management or operations . . . so long as such assistance
requires specialized knowledge or skills, and are related to the exploration, development and utilization of
mineral resources."227
This Court is not persuaded. As priorly pointed out, the phrase "management or other forms of assistance" in
the 1973 Constitution was deleted in the 1987 Constitution, which allows only "technical or financial
assistance." Casus omisus pro omisso habendus est. A person, object or thing omitted from an enumeration
must be held to have been omitted intentionally.228 As will be shown later, the management or operation of
mining activities by foreign contractors, which is the primary feature of service contracts, was precisely the evil
that the drafters of the 1987 Constitution sought to eradicate.
Respondents insist that "agreements involving technical or financial assistance" is just another term for service
contracts. They contend that the proceedings of the CONCOM indicate "that although the terminology 'service
contract' was avoided [by the Constitution], the concept it represented was not." They add that "[t]he concept
is embodied in the phrase 'agreements involving financial or technical assistance.'"229 And point out how
members of the CONCOM referred to these agreements as "service contracts." For instance:
SR. TAN. Am I correct in thinking that the only difference between these future service contracts and the past
service contracts under Mr. Marcos is the general law to be enacted by the legislature and the notification of
Congress by the President? That is the only difference, is it not?
MR. VILLEGAS. That is right.
SR. TAN. So those are the safeguards[?]
MR. VILLEGAS. Yes. There was no law at all governing service contracts before.
SR. TAN. Thank you, Madam President.230 [Emphasis supplied.]
WMCP also cites the following statements of Commissioners Gascon, Garcia, Nolledo and Tadeo who alluded to
service contracts as they explained their respective votes in the approval of the draft Article:
MR. GASCON. Mr. Presiding Officer, I vote no primarily because of two reasons: One, the provision on service
contracts. I felt that if we would constitutionalize any provision on service contracts, this should always be with
the concurrence of Congress and not guided only by a general law to be promulgated by Congress. x x x.231
[Emphasis supplied.]
x x x.
MR. GARCIA. Thank you.
I vote no. x x x.
Service contracts are given constitutional legitimization in Section 3, even when they have been proven to be
inimical to the interests of the nation, providing as they do the legal loophole for the exploitation of our natural
resources for the benefit of foreign interests. They constitute a serious negation of Filipino control on the use
and disposition of the nation's natural resources, especially with regard to those which are nonrenewable.232
[Emphasis supplied.]
xxx
MR. NOLLEDO. While there are objectionable provisions in the Article on National Economy and Patrimony,
going over said provisions meticulously, setting aside prejudice and personalities will reveal that the article
contains a balanced set of provisions. I hope the forthcoming Congress will implement such provisions taking
into account that Filipinos should have real control over our economy and patrimony, and if foreign equity is
permitted, the same must be subordinated to the imperative demands of the national interest.
x x x.
It is also my understanding that service contracts involving foreign corporations or entities are resorted to only
when no Filipino enterprise or Filipino-controlled enterprise could possibly undertake the exploration or
exploitation of our natural resources and that compensation under such contracts cannot and should not equal
what should pertain to ownership of capital. In other words, the service contract should not be an instrument
to circumvent the basic provision, that the exploration and exploitation of natural resources should be truly for
the benefit of Filipinos.
Thank you, and I vote yes.233 [Emphasis supplied.]
x x x.
MR. TADEO. Nais ko lamang ipaliwanag ang aking boto.
Matapos suriin ang kalagayan ng Pilipinas, ang saligang suliranin, pangunahin ang salitang "imperyalismo."
Ang ibig sabihin nito ay ang sistema ng lipunang pinaghaharian ng iilang monopolyong kapitalista at ang
salitang "imperyalismo" ay buhay na buhay sa National Economy and Patrimony na nating ginawa. Sa
pamamagitan ng salitang "based on," naroroon na ang free trade sapagkat tayo ay mananatiling tagapagluwas
ng hilaw na sangkap at tagaangkat ng yaring produkto. Pangalawa, naroroon pa rin ang parity rights, ang
service contract, ang 60-40 equity sa natural resources. Habang naghihirap ang sambayanang Pilipino,
ginagalugad naman ng mga dayuhan ang ating likas na yaman. Kailan man ang Article on National Economy
and Patrimony ay hindi nagpaalis sa pagkaalipin ng ating ekonomiya sa kamay ng mga dayuhan. Ang solusyon
sa suliranin ng bansa ay dalawa lamang: ang pagpapatupad ng tunay na reporma sa lupa at ang national
industrialization. Ito ang tinatawag naming pagsikat ng araw sa Silangan. Ngunit ang mga landlords and big
businessmen at ang mga komprador ay nagsasabi na ang free trade na ito, ang kahulugan para sa amin, ay
ipinipilit sa ating sambayanan na ang araw ay sisikat sa Kanluran. Kailan man hindi puwedeng sumikat ang
araw sa Kanluran. I vote no.234 [Emphasis supplied.]
This Court is likewise not persuaded.
As earlier noted, the phrase "service contracts" has been deleted in the 1987 Constitution's Article on National
Economy and Patrimony. If the CONCOM intended to retain the concept of service contracts under the 1973
Constitution, it could have simply adopted the old terminology ("service contracts") instead of employing new
and unfamiliar terms ("agreements . . . involving either technical or financial assistance"). Such a difference
between the language of a provision in a revised constitution and that of a similar provision in the preceding
constitution is viewed as indicative of a difference in purpose.235 If, as respondents suggest, the concept of
"technical or financial assistance" agreements is identical to that of "service contracts," the CONCOM would
not have bothered to fit the same dog with a new collar. To uphold respondents' theory would reduce the first
to a mere euphemism for the second and render the change in phraseology meaningless.
An examination of the reason behind the change confirms that technical or financial assistance agreements are
not synonymous to service contracts.
[T]he Court in construing a Constitution should bear in mind the object sought to be accomplished by its
adoption, and the evils, if any, sought to be prevented or remedied. A doubtful provision will be examined in
light of the history of the times, and the condition and circumstances under which the Constitution was
framed. The object is to ascertain the reason which induced the framers of the Constitution to enact the
particular provision and the purpose sought to be accomplished thereby, in order to construe the whole as to
make the words consonant to that reason and calculated to effect that purpose.236
As the following question of Commissioner Quesada and Commissioner Villegas' answer shows the drafters
intended to do away with service contracts which were used to circumvent the capitalization (60%-40%)
requirement:
MS. QUESADA. The 1973 Constitution used the words "service contracts." In this particular Section 3, is there
a safeguard against the possible control of foreign interests if the Filipinos go into coproduction with them?
MR. VILLEGAS. Yes. In fact, the deletion of the phrase "service contracts" was our first attempt to avoid some
of the abuses in the past regime in the use of service contracts to go around the 60-40 arrangement. The
safeguard that has been introduced – and this, of course can be refined – is found in Section 3, lines 25 to 30,
where Congress will have to concur with the President on any agreement entered into between a foreign-
owned corporation and the government involving technical or financial assistance for large-scale exploration,
development and utilization of natural resources.237 [Emphasis supplied.]
In a subsequent discussion, Commissioner Villegas allayed the fears of Commissioner Quesada regarding the
participation of foreign interests in Philippine natural resources, which was supposed to be restricted to
Filipinos.
MS. QUESADA. Another point of clarification is the phrase "and utilization of natural resources shall be under
the full control and supervision of the State." In the 1973 Constitution, this was limited to citizens of the
Philippines; but it was removed and substituted by "shall be under the full control and supervision of the
State." Was the concept changed so that these particular resources would be limited to citizens of the
Philippines? Or would these resources only be under the full control and supervision of the State; meaning,
noncitizens would have access to these natural resources? Is that the understanding?
MR. VILLEGAS. No, Mr. Vice-President, if the Commissioner reads the next sentence, it states:
Such activities may be directly undertaken by the State, or it may enter into co-production, joint venture,
production-sharing agreements with Filipino citizens.
So we are still limiting it only to Filipino citizens.
x x x.
MS. QUESADA. Going back to Section 3, the section suggests that:
The exploration, development, and utilization of natural resources… may be directly undertaken by the State,
or it may enter into co-production, joint venture or production-sharing agreement with . . . corporations or
associations at least sixty per cent of whose voting stock or controlling interest is owned by such citizens.
Lines 25 to 30, on the other hand, suggest that in the large-scale exploration, development and utilization of
natural resources, the President with the concurrence of Congress may enter into agreements with foreign-
owned corporations even for technical or financial assistance.
I wonder if this part of Section 3 contradicts the second part. I am raising this point for fear that foreign
investors will use their enormous capital resources to facilitate the actual exploitation or exploration,
development and effective disposition of our natural resources to the detriment of Filipino investors. I am not
saying that we should not consider borrowing money from foreign sources. What I refer to is that foreign
interest should be allowed to participate only to the extent that they lend us money and give us technical
assistance with the appropriate government permit. In this way, we can insure the enjoyment of our natural
resources by our own people.
MR. VILLEGAS. Actually, the second provision about the President does not permit foreign investors to
participate. It is only technical or financial assistance – they do not own anything – but on conditions that have
to be determined by law with the concurrence of Congress. So, it is very restrictive.
If the Commissioner will remember, this removes the possibility for service contracts which we said yesterday
were avenues used in the previous regime to go around the 60-40 requirement.238 [Emphasis supplied.]
The present Chief Justice, then a member of the CONCOM, also referred to this limitation in scope in
proposing an amendment to the 60-40 requirement:
MR. DAVIDE. May I be allowed to explain the proposal?
MR. MAAMBONG. Subject to the three-minute rule, Madam President.
MR. DAVIDE. It will not take three minutes.
The Commission had just approved the Preamble. In the Preamble we clearly stated that the Filipino people
are sovereign and that one of the objectives for the creation or establishment of a government is to conserve
and develop the national patrimony. The implication is that the national patrimony or our natural resources are
exclusively reserved for the Filipino people. No alien must be allowed to enjoy, exploit and develop our natural
resources. As a matter of fact, that principle proceeds from the fact that our natural resources are gifts from
God to the Filipino people and it would be a breach of that special blessing from God if we will allow aliens to
exploit our natural resources.
I voted in favor of the Jamir proposal because it is not really exploitation that we granted to the alien
corporations but only for them to render financial or technical assistance. It is not for them to enjoy our
natural resources. Madam President, our natural resources are depleting; our population is increasing by leaps
and bounds. Fifty years from now, if we will allow these aliens to exploit our natural resources, there will be no
more natural resources for the next generations of Filipinos. It may last long if we will begin now. Since 1935
the aliens have been allowed to enjoy to a certain extent the exploitation of our natural resources, and we
became victims of foreign dominance and control. The aliens are interested in coming to the Philippines
because they would like to enjoy the bounty of nature exclusively intended for Filipinos by God.
And so I appeal to all, for the sake of the future generations, that if we have to pray in the Preamble "to
preserve and develop the national patrimony for the sovereign Filipino people and for the generations to
come," we must at this time decide once and for all that our natural resources must be reserved only to
Filipino citizens.
Thank you.239 [Emphasis supplied.]
The opinion of another member of the CONCOM is persuasive240 and leaves no doubt as to the intention of
the framers to eliminate service contracts altogether. He writes:
Paragraph 4 of Section 2 specifies large-scale, capital-intensive, highly technological undertakings for which
the President may enter into contracts with foreign-owned corporations, and enunciates strict conditions that
should govern such contracts. x x x.
This provision balances the need for foreign capital and technology with the need to maintain the national
sovereignty. It recognizes the fact that as long as Filipinos can formulate their own terms in their own
territory, there is no danger of relinquishing sovereignty to foreign interests.
Are service contracts allowed under the new Constitution? No. Under the new Constitution, foreign investors
(fully alien-owned) can NOT participate in Filipino enterprises except to provide: (1) Technical Assistance for
highly technical enterprises; and (2) Financial Assistance for large-scale enterprises.
The intent of this provision, as well as other provisions on foreign investments, is to prevent the practice
(prevalent in the Marcos government) of skirting the 60/40 equation using the cover of service contracts.241
[Emphasis supplied.]
Furthermore, it appears that Proposed Resolution No. 496,242 which was the draft Article on National
Economy and Patrimony, adopted the concept of "agreements . . . involving either technical or financial
assistance" contained in the "Draft of the 1986 U.P. Law Constitution Project" (U.P. Law draft) which was
taken into consideration during the deliberation of the CONCOM.243 The former, as well as Article XII, as
adopted, employed the same terminology, as the comparative table below shows:
DRAFT OF THE UP LAW CONSTITUTION PROJECT
PROPOSED RESOLUTION NO. 496 OF THE CONSTITUTIONAL COMMISSION
ARTICLE XII OF THE 1987 CONSTITUTION
Sec. 1. All lands of the public domain, waters, minerals, coal, petroleum and other mineral oils, all forces of
potential energy, fisheries, flora and fauna and other natural resources of the Philippines are owned by the
State. With the exception of agricultural lands, all other natural resources shall not be alienated. The
exploration, development and utilization of natural resources shall be under the full control and supervision of
the State. Such activities may be directly undertaken by the state, or it may enter into co-production, joint
venture, production sharing agreements with Filipino citizens or corporations or associations sixty per cent of
whose voting stock or controlling interest is owned by such citizens for a period of not more than twenty-five
years, renewable for not more than twenty-five years and under such terms and conditions as may be
provided by law. In case as to water rights for irrigation, water supply, fisheries, or industrial uses other than
the development of water power, beneficial use may be the measure and limit of the grant.
The National Assembly may by law allow small scale utilization of natural resources by Filipino citizens.
The National Assembly, may, by two-thirds vote of all its members by special law provide the terms and
conditions under which a foreign-owned corporation may enter into agreements with the government involving
either technical or financial assistance for large-scale exploration, development, or utilization of natural
resources. [Emphasis supplied.]
Sec. 3. All lands of the public domain, waters, minerals, coal, petroleum and other mineral oils, all forces of
potential energy, fisheries, forests, flora and fauna, and other natural resources are owned by the State. With
the exception of agricultural lands, all other natural resources shall not be alienated. The exploration,
development, and utilization of natural resources shall be under the full control and supervision of the State.
Such activities may be directly undertaken by the State, or it may enter into co-production, joint venture,
production-sharing agreements with Filipino citizens or corporations or associations at least sixty per cent of
whose voting stock or controlling interest is owned by such citizens. Such agreements shall be for a period of
twenty-five years, renewable for not more than twenty-five years, and under such term and conditions as may
be provided by law. In cases of water rights for irrigation, water supply, fisheries or industrial uses other than
the development for water power, beneficial use may be the measure and limit of the grant.
The Congress may by law allow small-scale utilization of natural resources by Filipino citizens, as well as
cooperative fish farming in rivers, lakes, bays, and lagoons.
The President with the concurrence of Congress, by special law, shall provide the terms and conditions under
which a foreign-owned corporation may enter into agreements with the government involving either technical
or financial assistance for large-scale exploration, development, and utilization of natural resources. [Emphasis
supplied.]
Sec. 2. All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned
by the State. With the exception of agricultural lands, all other natural resources shall not be alienated. The
exploration, development, and utilization of natural resources shall be under the full control and supervision of
the State. The State may directly undertake such activities or it may enter into co-production, joint venture, or
production-sharing agreements with Filipino citizens, or corporations or associations at least sixty per centum
of whose capital is owned by such citizens. Such agreements may be for a period not exceeding twenty-five
years, renewable for not more than twenty-five years, and under such terms and conditions as may be
provided by law. In case of water rights for irrigation, water supply, fisheries, or industrial uses other than the
development of water power, beneficial use may be the measure and limit of the grant.
The State shall protect the nation's marine wealth in its archipelagic waters, territorial sea, and exclusive
economic zone, and reserve its use and enjoyment exclusively to Filipino citizens.
The Congress may, by law, allow small-scale utilization of natural resources by Filipino citizens, as well as
cooperative fish farming, with priority to subsistence fishermen and fish-workers in rivers, lakes, bays, and
lagoons.
The President may enter into agreements with foreign-owned corporations involving either technical or
financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other
mineral oils according to the general terms and conditions provided by law, based on real contributions to the
economic growth and general welfare of the country. In such agreements, the State shall promote the
development and use of local scientific and technical resources. [Emphasis supplied.]
The President shall notify the Congress of every contract entered into in accordance with this provision, within
thirty days from its execution.
The insights of the proponents of the U.P. Law draft are, therefore, instructive in interpreting the phrase
"technical or financial assistance."
In his position paper entitled Service Contracts: Old Wine in New Bottles?, Professor Pacifico A. Agabin, who
was a member of the working group that prepared the U.P. Law draft, criticized service contracts for they
"lodge exclusive management and control of the enterprise to the service contractor, which is reminiscent of
the old concession regime. Thus, notwithstanding the provision of the Constitution that natural resources
belong to the State, and that these shall not be alienated, the service contract system renders nugatory the
constitutional provisions cited."244 He elaborates:
Looking at the Philippine model, we can discern the following vestiges of the concession regime, thus:
1. Bidding of a selected area, or leasing the choice of the area to the interested party and then negotiating the
terms and conditions of the contract; (Sec. 5, P.D. 87)
2. Management of the enterprise vested on the contractor, including operation of the field if petroleum is
discovered; (Sec. 8, P.D. 87)
3. Control of production and other matters such as expansion and development; (Sec. 8)
4. Responsibility for downstream operations – marketing, distribution, and processing may be with the
contractor (Sec. 8);
5. Ownership of equipment, machinery, fixed assets, and other properties remain with contractor (Sec. 12,
P.D. 87);
6. Repatriation of capital and retention of profits abroad guaranteed to the contractor (Sec. 13, P.D. 87); and
7. While title to the petroleum discovered may nominally be in the name of the government, the contractor
has almost unfettered control over its disposition and sale, and even the domestic requirements of the country
is relegated to a pro rata basis (Sec. 8).
In short, our version of the service contract is just a rehash of the old concession regime x x x. Some people
have pulled an old rabbit out of a magician's hat, and foisted it upon us as a new and different animal.
The service contract as we know it here is antithetical to the principle of sovereignty over our natural
resources restated in the same article of the [1973] Constitution containing the provision for service contracts.
If the service contractor happens to be a foreign corporation, the contract would also run counter to the
constitutional provision on nationalization or Filipinization, of the exploitation of our natural resources.245
[Emphasis supplied. Underscoring in the original.]
Professor Merlin M. Magallona, also a member of the working group, was harsher in his reproach of the
system:
x x x the nationalistic phraseology of the 1935 [Constitution] was retained by the [1973] Charter, but the
essence of nationalism was reduced to hollow rhetoric. The 1973 Charter still provided that the exploitation or
development of the country's natural resources be limited to Filipino citizens or corporations owned or
controlled by them. However, the martial-law Constitution allowed them, once these resources are in their
name, to enter into service contracts with foreign investors for financial, technical, management, or other
forms of assistance. Since foreign investors have the capital resources, the actual exploitation and
development, as well as the effective disposition, of the country's natural resources, would be under their
direction, and control, relegating the Filipino investors to the role of second-rate partners in joint ventures.
Through the instrumentality of the service contract, the 1973 Constitution had legitimized at the highest level
of state policy that which was prohibited under the 1973 Constitution, namely: the exploitation of the country's
natural resources by foreign nationals. The drastic impact of [this] constitutional change becomes more
pronounced when it is considered that the active party to any service contract may be a corporation wholly
owned by foreign interests. In such a case, the citizenship requirement is completely set aside, permitting
foreign corporations to obtain actual possession, control, and [enjoyment] of the country's natural
resources.246 [Emphasis supplied.]
Accordingly, Professor Agabin recommends that:
Recognizing the service contract for what it is, we have to expunge it from the Constitution and reaffirm
ownership over our natural resources. That is the only way we can exercise effective control over our natural
resources.
This should not mean complete isolation of the country's natural resources from foreign investment. Other
contract forms which are less derogatory to our sovereignty and control over natural resources – like technical
assistance agreements, financial assistance [agreements], co-production agreements, joint ventures,
production-sharing – could still be utilized and adopted without violating constitutional provisions. In other
words, we can adopt contract forms which recognize and assert our sovereignty and ownership over natural
resources, and where the foreign entity is just a pure contractor instead of the beneficial owner of our
economic resources.247 [Emphasis supplied.]
Still another member of the working group, Professor Eduardo Labitag, proposed that:
2. Service contracts as practiced under the 1973 Constitution should be discouraged, instead the government
may be allowed, subject to authorization by special law passed by an extraordinary majority to enter into
either technical or financial assistance. This is justified by the fact that as presently worded in the 1973
Constitution, a service contract gives full control over the contract area to the service contractor, for him to
work, manage and dispose of the proceeds or production. It was a subterfuge to get around the nationality
requirement of the constitution.248 [Emphasis supplied.]
In the annotations on the proposed Article on National Economy and Patrimony, the U.P. Law draft
summarized the rationale therefor, thus:
5. The last paragraph is a modification of the service contract provision found in Section 9, Article XIV of the
1973 Constitution as amended. This 1973 provision shattered the framework of nationalism in our fundamental
law (see Magallona, "Nationalism and its Subversion in the Constitution"). Through the service contract, the
1973 Constitution had legitimized that which was prohibited under the 1935 constitution—the exploitation of
the country's natural resources by foreign nationals. Through the service contract, acts prohibited by the Anti-
Dummy Law were recognized as legitimate arrangements. Service contracts lodge exclusive management and
control of the enterprise to the service contractor, not unlike the old concession regime where the
concessionaire had complete control over the country's natural resources, having been given exclusive and
plenary rights to exploit a particular resource and, in effect, having been assured of ownership of that resource
at the point of extraction (see Agabin, "Service Contracts: Old Wine in New Bottles"). Service contracts, hence,
are antithetical to the principle of sovereignty over our natural resources, as well as the constitutional
provision on nationalization or Filipinization of the exploitation of our natural resources.
Under the proposed provision, only technical assistance or financial assistance agreements may be entered
into, and only for large-scale activities. These are contract forms which recognize and assert our sovereignty
and ownership over natural resources since the foreign entity is just a pure contractor and not a beneficial
owner of our economic resources. The proposal recognizes the need for capital and technology to develop our
natural resources without sacrificing our sovereignty and control over such resources by the safeguard of a
special law which requires two-thirds vote of all the members of the Legislature. This will ensure that such
agreements will be debated upon exhaustively and thoroughly in the National Assembly to avert prejudice to
the nation.249 [Emphasis supplied.]
The U.P. Law draft proponents viewed service contracts under the 1973 Constitution as grants of beneficial
ownership of the country's natural resources to foreign owned corporations. While, in theory, the State owns
these natural resources – and Filipino citizens, their beneficiaries – service contracts actually vested foreigners
with the right to dispose, explore for, develop, exploit, and utilize the same. Foreigners, not Filipinos, became
the beneficiaries of Philippine natural resources. This arrangement is clearly incompatible with the
constitutional ideal of nationalization of natural resources, with the Regalian doctrine, and on a broader
perspective, with Philippine sovereignty.
The proponents nevertheless acknowledged the need for capital and technical know-how in the large-scale
exploitation, development and utilization of natural resources – the second paragraph of the proposed draft
itself being an admission of such scarcity. Hence, they recommended a compromise to reconcile the
nationalistic provisions dating back to the 1935 Constitution, which reserved all natural resources exclusively to
Filipinos, and the more liberal 1973 Constitution, which allowed foreigners to participate in these resources
through service contracts. Such a compromise called for the adoption of a new system in the exploration,
development, and utilization of natural resources in the form of technical agreements or financial agreements
which, necessarily, are distinct concepts from service contracts.
The replacement of "service contracts" with "agreements… involving either technical or financial assistance,"
as well as the deletion of the phrase "management or other forms of assistance," assumes greater significance
when note is taken that the U.P. Law draft proposed other equally crucial changes that were obviously heeded
by the CONCOM. These include the abrogation of the concession system and the adoption of new "options" for
the State in the exploration, development, and utilization of natural resources. The proponents deemed these
changes to be more consistent with the State's ownership of, and its "full control and supervision" (a phrase
also employed by the framers) over, such resources. The Project explained:
3. In line with the State ownership of natural resources, the State should take a more active role in the
exploration, development, and utilization of natural resources, than the present practice of granting licenses,
concessions, or leases – hence the provision that said activities shall be under the full control and supervision
of the State. There are three major schemes by which the State could undertake these activities: first, directly
by itself; second, by virtue of co-production, joint venture, production sharing agreements with Filipino citizens
or corporations or associations sixty per cent (60%) of the voting stock or controlling interests of which are
owned by such citizens; or third, with a foreign-owned corporation, in cases of large-scale exploration,
development, or utilization of natural resources through agreements involving either technical or financial
assistance only. x x x.
At present, under the licensing concession or lease schemes, the government benefits from such benefits only
through fees, charges, ad valorem taxes and income taxes of the exploiters of our natural resources. Such
benefits are very minimal compared with the enormous profits reaped by theses licensees, grantees,
concessionaires. Moreover, some of them disregard the conservation of natural resources and do not protect
the environment from degradation. The proposed role of the State will enable it to a greater share in the
profits – it can also actively husband its natural resources and engage in developmental programs that will be
beneficial to them.
4. Aside from the three major schemes for the exploration, development, and utilization of our natural
resources, the State may, by law, allow Filipino citizens to explore, develop, utilize natural resources in small-
scale. This is in recognition of the plight of marginal fishermen, forest dwellers, gold panners, and others
similarly situated who exploit our natural resources for their daily sustenance and survival.250
Professor Agabin, in particular, after taking pains to illustrate the similarities between the two systems,
concluded that the service contract regime was but a "rehash" of the concession system. "Old wine in new
bottles," as he put it. The rejection of the service contract regime, therefore, is in consonance with the
abolition of the concession system.
In light of the deliberations of the CONCOM, the text of the Constitution, and the adoption of other proposed
changes, there is no doubt that the framers considered and shared the intent of the U.P. Law proponents in
employing the phrase "agreements . . . involving either technical or financial assistance."
While certain commissioners may have mentioned the term "service contracts" during the CONCOM
deliberations, they may not have been necessarily referring to the concept of service contracts under the 1973
Constitution. As noted earlier, "service contracts" is a term that assumes different meanings to different
people.251 The commissioners may have been using the term loosely, and not in its technical and legal sense,
to refer, in general, to agreements concerning natural resources entered into by the Government with foreign
corporations. These loose statements do not necessarily translate to the adoption of the 1973 Constitution
provision allowing service contracts.
It is true that, as shown in the earlier quoted portions of the proceedings in CONCOM, in response to Sr. Tan's
question, Commissioner Villegas commented that, other than congressional notification, the only difference
between "future" and "past" "service contracts" is the requirement of a general law as there were no laws
previously authorizing the same.252 However, such remark is far outweighed by his more categorical
statement in his exchange with Commissioner Quesada that the draft article "does not permit foreign investors
to participate" in the nation's natural resources – which was exactly what service contracts did – except to
provide "technical or financial assistance."253
In the case of the other commissioners, Commissioner Nolledo himself clarified in his work that the present
charter prohibits service contracts.254 Commissioner Gascon was not totally averse to foreign participation,
but favored stricter restrictions in the form of majority congressional concurrence.255 On the other hand,
Commissioners Garcia and Tadeo may have veered to the extreme side of the spectrum and their objections
may be interpreted as votes against any foreign participation in our natural resources whatsoever.
WMCP cites Opinion No. 75, s. 1987,256 and Opinion No. 175, s. 1990257 of the Secretary of Justice,
expressing the view that a financial or technical assistance agreement "is no different in concept" from the
service contract allowed under the 1973 Constitution. This Court is not, however, bound by this interpretation.
When an administrative or executive agency renders an opinion or issues a statement of policy, it merely
interprets a pre-existing law; and the administrative interpretation of the law is at best advisory, for it is the
courts that finally determine what the law means.258
In any case, the constitutional provision allowing the President to enter into FTAAs with foreign-owned
corporations is an exception to the rule that participation in the nation's natural resources is reserved
exclusively to Filipinos. Accordingly, such provision must be construed strictly against their enjoyment by non-
Filipinos. As Commissioner Villegas emphasized, the provision is "very restrictive."259 Commissioner Nolledo
also remarked that "entering into service contracts is an exception to the rule on protection of natural
resources for the interest of the nation and, therefore, being an exception, it should be subject, whenever
possible, to stringent rules."260 Indeed, exceptions should be strictly but reasonably construed; they extend
only so far as their language fairly warrants and all doubts should be resolved in favor of the general provision
rather than the exception.261
With the foregoing discussion in mind, this Court finds that R.A. No. 7942 is invalid insofar as said Act
authorizes service contracts. Although the statute employs the phrase "financial and technical agreements" in
accordance with the 1987 Constitution, it actually treats these agreements as service contracts that grant
beneficial ownership to foreign contractors contrary to the fundamental law.
Section 33, which is found under Chapter VI (Financial or Technical Assistance Agreement) of R.A. No. 7942
states:
SEC. 33. Eligibility.—Any qualified person with technical and financial capability to undertake large-scale
exploration, development, and utilization of mineral resources in the Philippines may enter into a financial or
technical assistance agreement directly with the Government through the Department. [Emphasis supplied.]
"Exploration," as defined by R.A. No. 7942,
means the searching or prospecting for mineral resources by geological, geochemical or geophysical surveys,
remote sensing, test pitting, trending, drilling, shaft sinking, tunneling or any other means for the purpose of
determining the existence, extent, quantity and quality thereof and the feasibility of mining them for profit.262
A legally organized foreign-owned corporation may be granted an exploration permit,263 which vests it with
the right to conduct exploration for all minerals in specified areas,264 i.e., to enter, occupy and explore the
same.265 Eventually, the foreign-owned corporation, as such permittee, may apply for a financial and
technical assistance agreement.266
"Development" is the work undertaken to explore and prepare an ore body or a mineral deposit for mining,
including the construction of necessary infrastructure and related facilities.267
"Utilization" "means the extraction or disposition of minerals."268 A stipulation that the proponent shall
dispose of the minerals and byproducts produced at the highest price and more advantageous terms and
conditions as provided for under the implementing rules and regulations is required to be incorporated in every
FTAA.269
A foreign-owned/-controlled corporation may likewise be granted a mineral processing permit.270 "Mineral
processing" is the milling, beneficiation or upgrading of ores or minerals and rocks or by similar means to
convert the same into marketable products.271
An FTAA contractor makes a warranty that the mining operations shall be conducted in accordance with the
provisions of R.A. No. 7942 and its implementing rules272 and for work programs and minimum expenditures
and commitments.273 And it obliges itself to furnish the Government records of geologic, accounting, and
other relevant data for its mining operation.274
"Mining operation," as the law defines it, means mining activities involving exploration, feasibility,
development, utilization, and processing.275
The underlying assumption in all these provisions is that the foreign contractor manages the mineral
resources, just like the foreign contractor in a service contract.
Furthermore, Chapter XII of the Act grants foreign contractors in FTAAs the same auxiliary mining rights that it
grants contractors in mineral agreements (MPSA, CA and JV).276 Parenthetically, Sections 72 to 75 use the
term "contractor," without distinguishing between FTAA and mineral agreement contractors. And so does
"holders of mining rights" in Section 76. A foreign contractor may even convert its FTAA into a mineral
agreement if the economic viability of the contract area is found to be inadequate to justify large-scale mining
operations,277 provided that it reduces its equity in the corporation, partnership, association or cooperative to
forty percent (40%).278
Finally, under the Act, an FTAA contractor warrants that it "has or has access to all the financing, managerial,
and technical expertise. . . ."279 This suggests that an FTAA contractor is bound to provide some
management assistance – a form of assistance that has been eliminated and, therefore, proscribed by the
present Charter.
By allowing foreign contractors to manage or operate all the aspects of the mining operation, the above-cited
provisions of R.A. No. 7942 have in effect conveyed beneficial ownership over the nation's mineral resources
to these contractors, leaving the State with nothing but bare title thereto.
Moreover, the same provisions, whether by design or inadvertence, permit a circumvention of the
constitutionally ordained 60%-40% capitalization requirement for corporations or associations engaged in the
exploitation, development and utilization of Philippine natural resources.
In sum, the Court finds the following provisions of R.A. No. 7942 to be violative of Section 2, Article XII of the
Constitution:
(1) The proviso in Section 3 (aq), which defines "qualified person," to wit:
Provided, That a legally organized foreign-owned corporation shall be deemed a qualified person for purposes
of granting an exploration permit, financial or technical assistance agreement or mineral processing permit.
(2) Section 23,280 which specifies the rights and obligations of an exploration permittee, insofar as said
section applies to a financial or technical assistance agreement,
(3) Section 33, which prescribes the eligibility of a contractor in a financial or technical assistance agreement;
(4) Section 35,281 which enumerates the terms and conditions for every financial or technical assistance
agreement;
(5) Section 39,282 which allows the contractor in a financial and technical assistance agreement to convert the
same into a mineral production-sharing agreement;
(6) Section 56,283 which authorizes the issuance of a mineral processing permit to a contractor in a financial
and technical assistance agreement;
The following provisions of the same Act are likewise void as they are dependent on the foregoing provisions
and cannot stand on their own:
(1) Section 3 (g),284 which defines the term "contractor," insofar as it applies to a financial or technical
assistance agreement.
Section 34,285 which prescribes the maximum contract area in a financial or technical assistance agreements;
Section 36,286 which allows negotiations for financial or technical assistance agreements;
Section 37,287 which prescribes the procedure for filing and evaluation of financial or technical assistance
agreement proposals;
Section 38,288 which limits the term of financial or technical assistance agreements;
Section 40,289 which allows the assignment or transfer of financial or technical assistance agreements;
Section 41,290 which allows the withdrawal of the contractor in an FTAA;
The second and third paragraphs of Section 81,291 which provide for the Government's share in a financial
and technical assistance agreement; and
Section 90,292 which provides for incentives to contractors in FTAAs insofar as it applies to said contractors;
When the parts of the statute are so mutually dependent and connected as conditions, considerations,
inducements, or compensations for each other, as to warrant a belief that the legislature intended them as a
whole, and that if all could not be carried into effect, the legislature would not pass the residue independently,
then, if some parts are unconstitutional, all the provisions which are thus dependent, conditional, or
connected, must fall with them.293
There can be little doubt that the WMCP FTAA itself is a service contract.
Section 1.3 of the WMCP FTAA grants WMCP "the exclusive right to explore, exploit, utilise[,] process and
dispose of all Minerals products and by-products thereof that may be produced from the Contract Area."294
The FTAA also imbues WMCP with the following rights:
(b) to extract and carry away any Mineral samples from the Contract area for the purpose of conducting tests
and studies in respect thereof;
(c) to determine the mining and treatment processes to be utilised during the Development/Operating Period
and the project facilities to be constructed during the Development and Construction Period;
(d) have the right of possession of the Contract Area, with full right of ingress and egress and the right to
occupy the same, subject to the provisions of Presidential Decree No. 512 (if applicable) and not be prevented
from entry into private ands by surface owners and/or occupants thereof when prospecting, exploring and
exploiting for minerals therein;
xxx
(f) to construct roadways, mining, drainage, power generation and transmission facilities and all other types of
works on the Contract Area;
(g) to erect, install or place any type of improvements, supplies, machinery and other equipment relating to
the Mining Operations and to use, sell or otherwise dispose of, modify, remove or diminish any and all parts
thereof;
(h) enjoy, subject to pertinent laws, rules and regulations and the rights of third Parties, easement rights and
the use of timber, sand, clay, stone, water and other natural resources in the Contract Area without cost for
the purposes of the Mining Operations;
xxx
(i) have the right to mortgage, charge or encumber all or part of its interest and obligations under this
Agreement, the plant, equipment and infrastructure and the Minerals produced from the Mining Operations;
x x x. 295
All materials, equipment, plant and other installations erected or placed on the Contract Area remain the
property of WMCP, which has the right to deal with and remove such items within twelve months from the
termination of the FTAA.296
Pursuant to Section 1.2 of the FTAA, WMCP shall provide "[all] financing, technology, management and
personnel necessary for the Mining Operations." The mining company binds itself to "perform all Mining
Operations . . . providing all necessary services, technology and financing in connection therewith,"297 and to
"furnish all materials, labour, equipment and other installations that may be required for carrying on all Mining
Operations."298> WMCP may make expansions, improvements and replacements of the mining facilities and
may add such new facilities as it considers necessary for the mining operations.299
These contractual stipulations, taken together, grant WMCP beneficial ownership over natural resources that
properly belong to the State and are intended for the benefit of its citizens. These stipulations are abhorrent to
the 1987 Constitution. They are precisely the vices that the fundamental law seeks to avoid, the evils that it
aims to suppress. Consequently, the contract from which they spring must be struck down.
In arguing against the annulment of the FTAA, WMCP invokes the Agreement on the Promotion and Protection
of Investments between the Philippine and Australian Governments, which was signed in Manila on January
25, 1995 and which entered into force on December 8, 1995.
x x x. Article 2 (1) of said treaty states that it applies to investments whenever made and thus the fact that
[WMCP's] FTAA was entered into prior to the entry into force of the treaty does not preclude the Philippine
Government from protecting [WMCP's] investment in [that] FTAA. Likewise, Article 3 (1) of the treaty provides
that "Each Party shall encourage and promote investments in its area by investors of the other Party and shall
[admit] such investments in accordance with its Constitution, Laws, regulations and investment policies" and in
Article 3 (2), it states that "Each Party shall ensure that investments are accorded fair and equitable
treatment." The latter stipulation indicates that it was intended to impose an obligation upon a Party to afford
fair and equitable treatment to the investments of the other Party and that a failure to provide such treatment
by or under the laws of the Party may constitute a breach of the treaty. Simply stated, the Philippines could
not, under said treaty, rely upon the inadequacies of its own laws to deprive an Australian investor (like
[WMCP]) of fair and equitable treatment by invalidating [WMCP's] FTAA without likewise nullifying the service
contracts entered into before the enactment of RA 7942 such as those mentioned in PD 87 or EO 279.
This becomes more significant in the light of the fact that [WMCP's] FTAA was executed not by a mere Filipino
citizen, but by the Philippine Government itself, through its President no less, which, in entering into said
treaty is assumed to be aware of the existing Philippine laws on service contracts over the exploration,
development and utilization of natural resources. The execution of the FTAA by the Philippine Government
assures the Australian Government that the FTAA is in accordance with existing Philippine laws.300 [Emphasis
and italics by private respondents.]
The invalidation of the subject FTAA, it is argued, would constitute a breach of said treaty which, in turn,
would amount to a violation of Section 3, Article II of the Constitution adopting the generally accepted
principles of international law as part of the law of the land. One of these generally accepted principles is
pacta sunt servanda, which requires the performance in good faith of treaty obligations.
Even assuming arguendo that WMCP is correct in its interpretation of the treaty and its assertion that "the
Philippines could not . . . deprive an Australian investor (like [WMCP]) of fair and equitable treatment by
invalidating [WMCP's] FTAA without likewise nullifying the service contracts entered into before the enactment
of RA 7942 . . .," the annulment of the FTAA would not constitute a breach of the treaty invoked. For this
decision herein invalidating the subject FTAA forms part of the legal system of the Philippines.301 The equal
protection clause302 guarantees that such decision shall apply to all contracts belonging to the same class,
hence, upholding rather than violating, the "fair and equitable treatment" stipulation in said treaty.
One other matter requires clarification. Petitioners contend that, consistent with the provisions of Section 2,
Article XII of the Constitution, the President may enter into agreements involving "either technical or financial
assistance" only. The agreement in question, however, is a technical and financial assistance agreement.
Petitioners' contention does not lie. To adhere to the literal language of the Constitution would lead to absurd
consequences.303 As WMCP correctly put it:
x x x such a theory of petitioners would compel the government (through the President) to enter into contract
with two (2) foreign-owned corporations, one for financial assistance agreement and with the other, for
technical assistance over one and the same mining area or land; or to execute two (2) contracts with only one
foreign-owned corporation which has the capability to provide both financial and technical assistance, one for
financial assistance and another for technical assistance, over the same mining area. Such an absurd result is
definitely not sanctioned under the canons of constitutional construction.304 [Underscoring in the original.]
Surely, the framers of the 1987 Charter did not contemplate such an absurd result from their use of
"either/or." A constitution is not to be interpreted as demanding the impossible or the impracticable; and
unreasonable or absurd consequences, if possible, should be avoided.305 Courts are not to give words a
meaning that would lead to absurd or unreasonable consequences and a literal interpretation is to be rejected
if it would be unjust or lead to absurd results.306 That is a strong argument against its adoption.307
Accordingly, petitioners' interpretation must be rejected.
The foregoing discussion has rendered unnecessary the resolution of the other issues raised by the petition.
WHEREFORE, the petition is GRANTED. The Court hereby declares unconstitutional and void:
(1) The following provisions of Republic Act No. 7942:
(a) The proviso in Section 3 (aq),
(b) Section 23,
(c) Section 33 to 41,
(d) Section 56,
(e) The second and third paragraphs of Section 81, and
(f) Section 90.
(2) All provisions of Department of Environment and Natural Resources Administrative Order 96-40, s. 1996
which are not in conformity with this Decision, and
(3) The Financial and Technical Assistance Agreement between the Government of the Republic of the
Philippines and WMC Philippines, Inc.
SO ORDERED.

11. REPUBLIC VS PAGADUAN CITY TIMBER

Republic of the Philippines

SUPREME COURT
Manila
THIRD DIVISION

REPUBLIC OF THE PHILIPPINES, represented by the Department of Environment and Natural Resources
(DENR),
Petitioner,
- versus -
PAGADIAN CITY TIMBER CO., INC.,
Respondent.
G.R. No. 159308
Present:
YNARES-SANTIAGO, J.,
Chairperson,
AUSTRIA-MARTINEZ,
CHICO-NAZARIO,
NACHURA, and
REYES, JJ.
Promulgated:
September 16, 2008

x------------------------------------------------------------------------------------x
DECISION
NACHURA, J.:
This is a Petition for Review on Certiorari1 under Rule 45 of the Rules of Court seeking to nullify and set aside
the Decision2 dated October 18, 2001 and the Resolution3 dated July 24, 2003 of the Court of Appeals in CA-
G.R. SP No. 59194 entitled "Pagadian City Timber Co., Inc. v. Antonio Cerilles, as Secretary of the Department
of Environment and Natural Resources (DENR) and Antonio Mendoza, as Regional Executive Director, DENR,
Region IX."
The antecedent facts are as follows:
On October 14, 1994, petitioner, through the DENR, and respondent Pagadian City Timber Co., Inc. executed
Industrial Forest Management Agreement (IFMA) No. R-9-0404 whereby petitioner, represented by then
Regional Executive Director (RED) for Region IX, Leonito C. Umali, authorized respondent, represented by its
President Filomena San Juan, to develop, utilize, and manage a specified forest area covering 1,999.14
hectares located in Barangays Langapod, Cogonan, and Datagan, Municipality of Labangan, Zamboanga del
Sur, for the production of timber and other forest products subject to a production-sharing scheme.
Respondent later submitted the required Comprehensive Development and Management Plan (CDMP) which
the DENR approved on August 17, 1995.
On October 8, 1998, in response to the numerous complaints filed by members of the Subanen tribe regarding
respondent’s alleged failure to implement the CDMP, disrespect of their rights as an indigenous people, and
the constant threats and harassment by armed men employed by respondent, RED Antonio Mendoza, DENR
Region IX, issued Regional Special Order No. 217 creating a regional team to evaluate and assess IFMA No. R-
9-040.
Thus, the DENR sent a letter dated October 22, 1998 to respondent, giving notice of the evaluation and
assessment to be conducted on the area from October 22-30, 1998 covering the years 1997 and 1998. In the
notice, the DENR requested any representative of the company to appear at the CENRO Office, Pagadian City,
and bring with him documents and maps concerning its IFMA operations.
On October 23, 1998, a DENR Evaluation Team composed of Aniceto Wenceslao (Forester, DENR, Zamboanga
del Sur), Isabelo Mangaya-ay (Intern Chief, RCBF/MCO), Philidor Lluisma (Forester II, Regional Office),
Chanito Paul Siton (C. Forester, CENRO-Pagadian City), Adelberto Roullo (Forester, CENRO, Pagadian City),
and Francisco Martin (Carto LEP, CENRO, Pagadian City) went to the IFMA site. After a briefing conference
between the Evaluation Team and respondent’s Operations Manager, Inocencio Santiago, actual field
evaluation and assessment followed.
On October 29, 1998, an exit conference and dialogue on post evaluation and assessment of IFMA R-9-04 was
held between DENR officials, namely, CENR Officer Maximo O. Dichoso, IFMA Regional Team Leader, Forester
Isabelo C. Mangaya-ay, and IFMA Regional Team Member, Forester Philidor O. Lluisma, and IFMA
Representative and Operations Manager Inocencio Santiago at the CENRO, Pagadian City.5 The exit
conference was called to order at 1:30 p.m. and was concluded at 3:00 p.m. Forester Mangaya-ay presented
the representative results and findings of the Evaluation Team, to wit:
The presiding officer started with the mango plantation in the Noran, Langapod side. That out of the estimated
number of seedlings planted of about 2,008 hills, within an equivalent area of 20 hectares, the result or finding
of the inventory conducted at 100% intensity is only 98 hills of seedlings survived including the doubtful and
badly deformed. The species planted along trails are Gmelina and Mahogany species. The said foot trail
planted with the aforementioned species starts from the entrance of the IFMA are where the notice billboard is
posted up to the only existing look-out tower. The estimated average of percent survival for Gmelina is more
or less 30%. There are also portions where higher percentage of survival is recorded at 56% and lower at
14%. There are areas planted declared by Kagawad Cerning Becagas of Barangay Cogonan now covered by
CSC. The areas covered by CSC, a waiver is needed to be issued by the IFMA holder.
CENR Officer Maximo O. Dichoso commented that during a meeting held before, the IFMA holder was willing
to give up the said areas.
The presiding officer continued that on the courtesy call made to the Barangay Chairman of Barangay
Cogonan, Mr. Roberto Palaran recounted the assistance extended by the IFMA holder to his barangay as
Community Assistance/service which includes electric generator, handheld radio and laborers for the repair of
Noburan – Cogonan road and the repair of the hanging bridge at Sitio Tialaic to which the said Barangay
Chairman issued a duly signed certification to this effect.
With regards, the seedling stock within the nursery, there are approximately a total number of about 44,460
seedlings of Gmelina species. That the infrastructure implemented or constructed, there exist only one look-
out tower of the reported 4 look-out towers constructed. Moreover, the team had also noted only 1 bunkhouse
and 1 stockroom or shedhouse. There is also 1 Multi-purpose shed and 1 dilapidated or neglected notice
billboard poster at the entrance trail leading to the IFMA area. That with regards the concrete monument,
there are only 2 recorded. The other corners visible are those located at junctions of creeks and rivers. But the
others cannot be visibly or never planted for the same cannot be pinpointed or shown to the team allegedly
for lack of knowledge by the representative of the IFMA holder. Finally, the presiding officer reminded the
herein IFMA representative Mr. Inocencio Santiago that per actual survey, inspection and ground verification,
the team believes that the other reported areas planted are located outside the designated IFMA area
particularly the Noburan and Langapod sides.6
After the presentation, Mangaya-ay asked Santiago if he had comments, suggestions, or questions regarding
the matter and the manner of the conduct of the evaluation and assessment by the Evaluation Team. Santiago
said he had none, but requested a copy of the report of the Evaluation Team. Mangaya-ay informed him that it
was only RED Mendoza who may furnish him a copy of the report.
Later, the Evaluation Team submitted a report through a Memorandum7 dated November 6, 1998 to the
DENR-RED of Region 9, Zamboanga City, on the evaluation and assessment of respondent under IFMA No. R-
9-040. The said Memorandum stated –
In compliance with Regional Special Order No. 217, Series of 1998, please be informed that the herein
information is the result or findings of the team for the conduct of evaluation and assessment following the
guidelines setforth under Department Administrative Order (DAO) No. 11, Series of 1995 of Pagadian Timber
Co., Inc. under IFMA No. R9-040 against their actual accomplishment as mandated under the terms and
conditions of the IFMA including other applicable laws, rules and regulations of the department on the matter.
At the onset, the team conducted a briefing conference and dialogue with the IFMA holder, the CENR Officer
of Pagadian City and personnel concerned for the proper and orderly implementation and conduct of the
evaluation and assessment (please see attached).
The team was composed of the Regional Evaluating Team, the CENRO and PENRO representatives and the
representatives of the IFMA holder. The team proceeded to the western portion of the area of the herein IFMA
particularly Barangay Cogonan, Labangan, Zamboanga del Sur. The evaluation and assessment was then
conducted on the main nursery, the established plantation, the look-out towers, the boundary of ISF and
claimed or occupied areas, natural or residual forest, the IFMA boundary, monuments planted, foot trails,
other improvements introduced and the billboard and signboard posted. The inspection, evaluation and
assessment conducted were all undertaken in the presence of the IFMA holder, representatives, laborers and
other personnel on the area. (please see attached report, tall sheets, pictorials and map).
In the conduct of the same, the IFMA representatives or laborers that assisted the team could only show the
subject area under evaluation but the other areas alluded to as accomplished or undertaken by the company
appeared upon actual verification and inspection to be negative and non-existent thus dispelling their
allegation.
With regard the information and dissemination conducted by the IFMA holder including other services
extended to the communities within the IFMA area and vicinities, it is noteworthy for recognition the donations
made by the company. (Please see attached minutes of the dialogue with the barangay officials of Barangay
Cogonan and pictorials).
The evaluation conducted on the nursery operations show that the facilities and other necessary implements
were generally below par. An inventory of the seedlings stock of pure Gmelina species have already lapsed its
plantability or have overgrown in the seedbed with an average grand total of about 44,460 within the
established 2-hectare main nursery area. There was no other subsidiary nursery established in the area. Also
noted is the enrichment planting conducted along both sides of the foot-trail which extends approximately 18
kms. From the entrance of the IFMA area going to the lookout tower of the four (4) lookout towers reported,
only one (1) has been noted remaining in the area and the rest were destroyed or burned (pls. see attached
pictorials). The signboard posted was unattended and in the state of disrepair. There were no monument
planted or any marking along the IFMA boundary and in residual forest except the monuments found in the
ISF boundaries within the IFMA area (please see attached pictorials). The plantation established is composed
of Gmelina species with 4 x 4 spacing over a total of about 10.18 hectares. Basing on 5% estimate inventory,
the result is 43% seedling survival.
Thereafter, the team also conducted evaluation and assessment at the eastern portion particularly at
Langapod, Labangan, Zamboanga del Sur. The team inspected and verified on the ground the reported 20
hectares mango plantation with a spacing of 10 x 10 meters at 100% intensity inventory. The accounted
number of mango seedlings planted of about 2,008 hills, only 98 seedlings survived. Wherefore, it generally
represents 5% seedling survival. (Please see attached)
Finally, the team conducted an exit conference with the CENR Officer, and the IFMA holder where the
tentative and general findings of the evaluation and assessment was laid-out and presented to the body.
(Please see attached)8
On the basis of such findings, the Evaluation Team made the following recommendations –
1. The lessee should be required to explain why they failed to develop their IFMA area (Plantation
Development) in accordance with the approved Comprehensive Development and Management Plan (CDMP);
2. The boundary and area coverage of IFMA No. R9-040 should be amended to exclude areas covered by
Certificates of Stewardship Contracts (CSC) under the ISF Program with an area of 226.17 hectares, other
areas previously identified as "occupied/claimed" and other conflict areas;
3. The amended boundary should be delineated/surveyed on the ground with a precise instrument and all
corners appropriately marked/monumented;
4. The company should hire a full time forester.9
Acting on the Memorandum dated November 6, 1998, RED Antonio M. Mendoza, DENR-IX, Zamboanga City,
submitted to the DENR Secretary a Memorandum10 dated April 7, 1999 regarding the performance evaluation
of IFMA No. R-9-040. The RED Memorandum reads –
This has reference with the instruction to validate the performance/accomplishment of IFMAs of Region IX,
Western Mindanao. Validation of IFMAs is in accordance with the existing policy of the DENR, to determine the
capabilities of the holders to develop their Lease areas in consonance with their submitted and approved
Comprehensive Development Management Plan.
xxxx
On 6 November 1998, Foresters Isabelo C. Mangaya-ay and Philidor Lluisma, pursuant to Regional Special
Order No. 217, Series of 1998, conducted the evaluation of the performance of IFMA No. R9-040 of Pagadian
City Timber Company, Inc. located at Langapod and Cogonan, Municipality of Labangan and Datagan,
Municipality of Sominot, all of Zamboanga del Sur. Result of the evaluation reveals that the holder violated the
following DENR existing Rules and Regulations particularly Section 26 of DAO 97-04 GROUNDS FOR
CANCELLATION of IFMA which provides that, "any of the following violations shall be sufficient grounds for the
cancellation of IFMA."
1. Paragraph 26.5, Section 26, DAO 97-04, Series of 1997, provides that failure to implement the approved
Comprehensive Development and Management Plan.
As of 1998, the 4th year of existence of IFMA No. R9-040, the holder must have developed a total of 1,597.0
hectares as per approved CDMP. However, based on the report submitted by the Evaluation Team only 365.2
hectares was planted which are about 22.8%. During the evaluation, however, the IFMA representative could
not even pinpoint the planted areas.
Per report of the Pagadian CENRO Composite Monitoring Team conducted on 21 August 1998 the plantation
area was burned resulting to the damage of about 300 hectares leaving only about 20.0 hectares undamaged.
No report had been submitted/received since then.
In infrastructure, the holder managed to put up one (1) out of four (4) programmed look-out towers;
developed one (1) out of two (2) forest nurseries and constructed only 6 km. foot trail which is only about
27% accomplishment of the whole infrastructure.

2. Paragraph 26.8 of Section 26, DAO 97-04, specifically provides that failure to implement or adopt
agreements made with communities and other relevant sectors.
Attached herewith, please find several petitions, sworn statements, affidavits and resolutions from various
sectors particularly the Subanen Communities (IP’s) within the area. The existence and approval of IFMA No.
R9-040 contract is being protested and is demanding for its cancellation.
The primary complaint was a blatant disrespect to their rights as an Indigenous People and the non-peaceful
co-existence between them and the holder of the IFMA R9-040. Accordingly, they were constantly
threatened/harassed by armed men employed by the holder.
In the same Memorandum, RED Mendoza recommended to the DENR Secretary the cancellation of IFMA No.
R-9-040. 11
It appears that RED Mendoza issued a subsequent but similar Memorandum12 dated April 21, 1999 to the
DENR Secretary relative to IFMA No. R-9-040. It stated –
This has reference with the instruction to validate the performance/accomplishment of IFMAs of Region IX,
Western Mindanao. Validation of IFMAs is in accordance with the existing policy of the DENR to determine the
capabilities of the holders to develop their Lease areas in consonance with their approved Comprehensive
Development and Management Plan.
In furtherance thereto, Foresters Isabelo C. Mangaya-ay and Philidor Lluisma, pursuant to Regional Special
Order No. 217, Series of 1998, conducted the evaluation of the performance of IFMA No. R9-040 of Pagadian
City Timber Company, Inc. located at the Municipalities of Labangan, Datagan and Sominot, all of Zamboanga
del Sur, on November 6, 1998. Result of the evaluation revealed that the holder violated Rules and
Regulations which are sufficient ground for cancellation as stipulated under Section 26 of DAO 97-04, they are
as follows
1. FAILURE TO IMPLEMENT THE APPROVED COMPREHENSIVE DEVELOPMENT AND MANAGEMENT PLAN.
Under the approved comprehensive and development plan, 1,597.0 ha of plantation should have been
established from the Approval of the CDMP. However, only 365.2 ha were reportedly planted from CY 1995 to
1997. This represents only 28% of the targeted goal on plantation establishment.
Field validation of the reported established plantation revealed otherwise. The findings of the team are:
A. Portion of the area reported as established plantation by the IFMA holder is an ISF project with an area of
226.17 ha. These are covered with Certificate of Stewardship;
B. Locations and boundaries of reported plantations established from 1995 to 1997 cannot be located on the
ground by the team neither by the representative of the IFMA holder who accompanied the validating team;
and
C. No plantation was established during CY 1998.
On Infrastructure, the holder constructed only one (1) lookout tower as against the goal of 4 towers;
established one (1) nursery as against the goal of two (2); and constructed only 6km foot trail. These
represent only 27% of the total infrastructure to be undertaken by the holder over the area.
2. FAILURE TO IMPLEMENT OR ADOPT AGREEMENT WITH COMMUNITIES AND OTHER RELEVANT SECTORS.
Attached herewith are copies of petitions, sworn statements, affidavit and resolutions from Subanen
Communities (IP’s) and other sectors in the area demanding the cancellation of IFMA R9-040.
The complaints and demand for cancellation by the people where the IFMA is located is a manifestation and
proof of non-social acceptance of the project by the residents in the locality.
In view of the above findings, IFMA No. R9-040 is hereby recommended for cancellation.13
Acting on the latter Memorandum from RED Mendoza, then DENR Secretary Antonio H. Cerilles, on June 7,
1999, issued an Order14 canceling IFMA No. R-9-040 for failure to implement the approved CDMP and for
failure of the lessee to protect the area from forest fires. The dispositive portion of the Order reads:
WHEREFORE, premises considered, IFMA No. R9-040 issued to Pagadian City Timber Co., Inc. is hereby
ordered cancelled. The IFMA holder is hereby ordered to immediately vacate the area and to surrender/return
copy of the Agreement to the Regional Executive Director, DENR Region 9, Zamboanga City.
The RED concerned or his duly authorized representative is hereby directed to serve this Order; determine
best end use of the land; take appropriate measures to protect the same and inform this Office immediately of
his compliance.
SO ORDERED.15
On July 2, 1999, respondent’s President, Filomena S. San Juan, wrote DENR Secretary Cerilles that the
company was surprised to receive the Order of the cancellation of IFMA No. R-9-040 on June 22, 1999. She
claimed that –
The DENR regional office is fully aware that the company is doing its best to manage and develop the area by
continually planting trees and protecting the area from forest fires and illegalities. No company would ever set
fire on its own plantation for obvious reasons. The company observed precautionary measures especially
during the time of the El Niño phenomenon. If there have been mistakes and miscommunications in the
reports of the DENR field officers, these could have been threshed out by a conference between DENR and the
Pagadian Timber Company Inc.
The company was not accorded due process before the order of cancellation was issued. The company was
not furnished copy of the evaluation and recommendation of the DENR Regional Executive Director of Region
IX. Had the company been given the opportunity to contest the findings, evaluation and recommendation of
the said office, the result would be otherwise.16
She appealed for the reconsideration of the Order asking that a re-investigation be conducted to comply with
due process.
Even as the said letter for reconsideration was not yet acted upon, respondent appealed to the Office of the
President (OP).
In the Resolution17 dated January 12, 2000, the OP affirmed the cancellation order based on the results of the
actual evaluation and assessment of the DENR team. It ruled that the cancellation of IFMA No. R-9-040 was
primarily and specifically governed by Section 26 of Department Administrative Order (DAO) 97-04. Relative to
respondent’s invocation of due process, the OP held that respondent was afforded the right to be heard when
it filed its motion for reconsideration and its subsequent appeal to the OP.

The motion for reconsideration filed by respondent of the January 12, 2000 Resolution was denied by the OP
in the Resolution18 dated May 8, 2000.
Respondent went up to the Court of Appeals (CA) via a petition for review with a prayer for the issuance of a
writ of preliminary injunction against the implementation of the assailed Order dated June 7, 1999.
In its Resolution dated January 17, 2001, the CA issued the writ of preliminary injunction prayed for, "directing
and ordering respondents (petitioner) and/or any other person acting under their command, authority and/or
for and in their behalf, to DESIST from implementing the assailed Order of cancellation dated June 7, 1999,
and/or taking over the IFMA premises of [respondent], pending the termination of this proceeding."
In its Decision19 dated October 18, 2001, the CA ruled in favor of respondents. In striking down the rulings of
the OP and the Order dated June 7, 1999, the CA declared that IFMA No. R-9-040 was a contract that could
not be unilaterally cancelled without infringing on the rights of respondent to due process and against
impairment of contracts. The appellate court agreed with respondent when the latter argued that it was
entitled to the benefits of Sections 3520 and 3621 of IFMA No. R-9-040 such that respondent should have
been given 30 days, after due notice, to remedy any breach or default of the provisions of the IFMA and/or
that the dispute regarding the bases for the cancellation of the IFMA should have first been submitted to
arbitration.
Petitioner moved to reconsider the CA Decision. In the Resolution22 dated July 24, 2003, the motion was
denied for lack of merit. Hence, this petition based on the following grounds:
I. The Court of Appeals gravely erred in ruling that IFMA No. R9-040 is a contract and not a mere privilege
granted by the State to respondent.
II. The Court of Appeals seriously erred in ordaining that respondent can rightfully invoke prior resort to
arbitration or the option to mend its violations under IFMA No. R9-040.23
In essence, petitioner argues that an IFMA is not an ordinary contract which is protected by the Constitution
against impairment24 but a mere privilege granted by the State to qualified persons by means of a permit,
license, franchise, agreement, or other similar concessions, which in this case is the exploration, development
and utilization of the forest lands belonging to the State under its full control and supervision. Thus, the
cancellation of the IFMA does not amount to a rescission of a contract but a mere withdrawal of this privilege.
As such, the due process clause under the Constitution25 does not likewise apply since the IFMA area cannot
be considered as property of respondent. According to petitioner, IFMA No. R-9-040, with the forest lands
covered by it, is imbued with paramount considerations of public interest and public welfare such that
whatever rights respondent may have under it must yield to the police power of the State. In this sense,
respondent cannot take refuge in Sections 35 and 36 of IFMA No. R-9-040 to prevent the IFMA’s cancellation.
Inasmuch as the grounds cited by petitioner are interrelated, they shall be jointly discussed hereunder.
The petition is impressed with merit.
IFMA No. R-9-040 is a license agreement under Presidential Decree (P.D.) No. 705 (Revised Forestry Code),
the law which is the very basis for its existence.26 Under Section 3, paragraph (dd) thereof, a license
agreement is defined as "a privilege27 granted by the State to a person to utilize forest resources within any
forest land with the right of possession and occupation thereof to the exclusion of others, except the
government, but with the corresponding obligation to develop, protect and rehabilitate the same in accordance
with the terms and conditions set forth in said agreement." This is evident in the following features, among
others, of IFMA No. R-9-040, to wit:
1. The State agreed to devolve to the holder of IFMA No. R-9-040 the responsibility to manage the specified
IFMA area for a period of 25 years, specifically until October 14, 2019, which period is automatically renewable
for another 25 years thereafter;
2. The State imposed upon respondent, as holder of IFMA No. R-9-040, the conditions, the means, and the
manner by which the IFMA area shall be managed, developed, and protected;
3. The State, through the DENR Secretary, shall not collect any rental within the first five (5) years of the
IFMA, after which it shall be entitled to annual rental of fifty centavos (P0.50) per hectare from the sixth to the
tenth year thereof, and one peso (P1.00) per hectare thereafter;
4. The IFMA area, except only the trees and other crops planted and the permanent improvements
constructed by the IFMA holder, remains the property of the State; and
5. Upon cancellation of the IFMA through the fault of the holder, all improvements including forest plantations
existing within the IFMA area shall revert to and become the property of the State.
An IFMA has for its precursor the Timber License Agreement (TLA), one of the tenurial instruments issued by
the State to its grantees for the efficient management of the country’s dwindling forest resources.
Jurisprudence has been consistent in holding that license agreements are not contracts within the purview of
the due process and the non-impairment of contracts clauses enshrined in the Constitution. Our
pronouncement in Alvarez v. PICOP Resources, Inc.28 is enlightening –
In unequivocal terms, we have consistently held that such licenses concerning the harvesting of timber in the
country’s forests cannot be considered contracts that would bind the Government regardless of changes in
policy and the demands of public interest and welfare. (citing Oposa v. Factoran, Jr., G.R. No. 101083, July 30,
1993, 224 SCRA 792, 811) Such unswerving verdict is synthesized in Oposa v. Factoran, Jr., (id., at pp. 811,
812) where we held:
In the first place, the respondent Secretary did not, for obvious reasons, even invoke in his motion to dismiss
the non-impairment clause. If he had done so, he would have acted with utmost infidelity to the Government
by providing undue and unwarranted benefits and advantages to the timber license holders because he would
have forever bound the Government to strictly respect the said licenses according to their terms and
conditions regardless of changes in policy and the demands of public interest and welfare. He was aware that
as correctly pointed out by petitioners, into every timber license must be read Section 20 of the Forestry
Reform Code (P.D. No. 705) which provides:
"x x x Provided, that when the national interest so requires, the President may amend, modify, replace or
rescind any contract, concession, permit, licenses or any other form of privilege granted herein x x x."
Needless to say, all licenses may thus be revoked or rescinded by executive action. It is not a contract,
property or a property right protected by the due process clause of the constitution. In Tan vs. Director of
Forestry, [125 SCRA 302, 325 (1983)] this Court held:
"x x x A timber license is an instrument by which the State regulates the utilization and disposition of forest
resources to the end that public welfare is promoted. A timber license is not a contract within the purview of
the due process clause; it is only a license or privilege, which can be validly withdrawn whenever dictated by
public interest or public welfare as in this case.
"A license is merely a permit or privilege to do what otherwise would be unlawful, and is not a contract
between the authority, federal, state, or municipal, granting it and the person to whom it is granted; neither is
it property or a property right, nor does it create a vested right; nor is it taxation (37 C.J. 168). Thus, this
Court held that the granting of license does not create irrevocable rights, neither is it property or property
rights. (People vs. Ong Tin, 54 O.G. 7576). x x x"
We reiterated this pronouncement in Felipe Ysmael, Jr. & Co., Inc. vs. Deputy Executive Secretary [190 SCRA
673, 684 (1990):
"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]."
Since timber licenses are not contracts, the non-impairment clause, which reads:
"SEC. 10. No law impairing, the obligation of contracts shall be passed."
cannot be invoked.
Even assuming arguendo that an IFMA can be considered a contract or an agreement, we agree with the
Office of the Solicitor General that the alleged property rights that may have arisen from it are not absolute.
All Filipino citizens are entitled, by right, to a balanced and healthful ecology as declared under Section 16,29
Article II of the Constitution. This right carries with it the correlative duty to refrain from impairing the
environment,30 particularly our diminishing forest resources. To uphold and protect this right is an express
policy of the State.31 The DENR is the instrumentality of the State mandated to actualize this policy. It is "the
primary government agency responsible for the conservation, management, development and proper use of
the country’s environment and natural resources, including those in reservation and watershed areas, and
lands of the public domain, as well as the licensing and regulation of all natural resources as may be provided
for by law in order to ensure equitable sharing of the benefits derived therefrom for the welfare of the present
and future generations of Filipinos."32
Thus, private rights must yield when they come in conflict with this public policy and common interest. They
must give way to the police or regulatory power of the State, in this case through the DENR, to ensure that
the terms and conditions of existing laws, rules and regulations, and the IFMA itself are strictly and faithfully
complied with.
Respondent was not able to overturn by sufficient evidence the presumption of regularity in the performance
of official functions of the Evaluation Team when the latter inspected, assessed, and reported the violations
respondent committed under DAO No. 97-04 which eventually led to the cancellation of IFMA No. R-9-040.
It is worthy to note that petitioner followed regular procedure regarding the assessment of IFMA No. R-9-040.
It gave notice of the evaluation on October 22, 1998 to be held within the period October 22-30, 1998.
Respondent admitted through the affidavits of its President,33 Operations Manager,34 and workers35 that an
Evaluation Team arrived at the IFMA area on October 23, 1998. On October 23, 1998, prior to the actual
assessment, a briefing was held on the conduct thereof in the presence of the IFMA representatives. On
October 29, 1998, an exit conference with IFMA Operations Manager Inocencio Santiago was held at the
CENRO Office, Pagadian City, where the results of the assessment were presented. That day, the DENR
officials asked Santiago if he had any questions or comments on the assessment results and on the manner
the evaluation was conducted, but the latter replied that he had none.
We do not understand why Santiago did not lift a finger or raise an objection to the assessment results, and
only much later in his Affidavit executed almost ten months thereafter, or on August 12, 1999, to claim so
belatedly that there was no notice given on October 22, 1998, that the Evaluation Team did not actually
extensively inspect the IFMA area on October 23, 1998, and that there was no proper exit conference held on
October 29, 1998. The same observation applies to respondent’s President herself, who instead claimed that
she vehemently opposed the appointment of then DENR Secretary Cerilles because he was bent on canceling
the IFMA at all costs, prior to the cancellation of IFMA No. R-9-040.
Besides, the detailed findings on the failure of respondent to implement its CDMP under its IFMA, as shown by
the November 6, 1998 Report of the Evaluation Team and the Memoranda dated April 7, 1999 and April 21,
1999, together with all its attachments, belie respondent’s claim that there was no actual evaluation and
assessment that took place on October 23, 1998. That the Evaluation Report was dated November 6, 1998
does not conclusively show that the evaluation was actually held on that date. Neither was this properly
proven by the Memoranda of RED Mendoza which stated that the evaluation was conducted on November 6,
1998, since RED Mendoza could have been merely misled into such an assumption because of the date of the
Evaluation Report. The sweeping denials made by the IFMA representatives and their self-serving
accomplishment reports cannot prevail over the actual inspection conducted, the results of which are shown
by documentary proof.
Respondent, likewise, cannot insist that, pursuant to Section 35 of IFMA No. R-9-040, it should have been
given notice of its breach of the IFMA and should have been given 30 days therefrom to remedy the breach. It
is worthy to note that Section 35 uses the word "may" which must be interpreted as granting petitioner the
discretion whether or not to give such notice and allow the option to remedy the breach. In this case, despite
the lack of any specific recommendation from the Evaluation Team for the cancellation of the IFMA, DENR
Secretary Cerilles deemed it proper to cancel the IFMA due to the extent and the gravity of respondent’s
violations.
It is also futile for respondent to claim that it is entitled to an arbitration under Section 36 of IFMA No. R-9-040
before the license agreement may be canceled. A reading of the said Section shows that the dispute should be
based on the provisions of the IFMA to warrant a referral to arbitration of an irreconcilable conflict between
the IFMA holder and the DENR Secretary. In this case, the cancellation was grounded on Section 26 of DAO
No. 97-04, particularly respondent’s failure to implement the approved CDMP and its failure to implement or
adopt agreements made with communities and other relevant sectors. The contrary notwithstanding, what
remains is that respondent never refuted the findings of the Evaluation Team when given the opportunity to
do so but waited until IFMA No. R-9-040 was already cancelled before it made its vigorous objections as to the
conduct of the evaluation, harping only on its alleged right to due process.
Indeed, respondent was given the opportunity to contest the findings that caused the cancellation of its IFMA
when it moved to reconsider the Order of cancellation and when it filed its appeal and motion for
reconsideration before the OP.
The essence of due process is simply an opportunity to be heard, or as applied to administrative proceedings,
an opportunity to explain one’s side or an opportunity to seek a reconsideration of the action or ruling
complained of. What the law prohibits is the absolute absence of the opportunity to be heard; hence, a party
cannot feign denial of due process where he had been afforded the opportunity to present his side.36
WHEREFORE, the Decision dated October 18, 2001 and the Resolution dated July 24, 2003 of the Court of
Appeals in CA-G.R. SP No. 59194 are REVERSED and SET ASIDE, and the Order dated June 7, 1999 of then
DENR Secretary Antonio Cerilles, and the Resolutions of the Office of the President dated January 12, 2000
and May 8, 2000 affirming the said Order, are REINSTATED and AFFIRMED. No pronouncement as to costs.
SO ORDERED.

12. APEX MINING CO VS SOUTHEAST MINDANAO MINING CORP

G.R. Nos. 152613 & 152628 November 20, 2009

APEX MINING CO., INC., petitioner,
vs.
SOUTHEAST MINDANAO GOLD MINING CORP., the mines adjudication board, provincial mining regulatory
board (PMRB-DAVAO), MONKAYO INTEGRATED SMALL SCALE MINERS ASSOCIATION, INC., ROSENDO
VILLAFLOR, BALITE COMMUNAL PORTAL MINING COOPERATIVE, DAVAO UNITED MINERS COOPERATIVE,
ANTONIO DACUDAO, PUTING-BATO GOLD MINERS COOPERATIVE, ROMEO ALTAMERA, THELMA CATAPANG,
LUIS GALANG, RENATO BASMILLO, FRANCISCO YOBIDO, EDUARDO GLORIA, EDWIN ASION, MACARIO
HERNANDEZ, REYNALDO CARUBIO, ROBERTO BUNIALES, RUDY ESPORTONO, ROMEO CASTILLO, JOSE REA,
GIL GANADO, PRIMITIVA LICAYAN, LETICIA ALQUEZA and JOEL BRILLANTES Management Mining
Corporation, Respondents.
x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 152619-20
BALITE COMMUNAL PORTAL MINING COOPERATIVE, petitioner,
vs.
SOUTHEAST MINDANAO GOLD MINING CORP., APEX MINING CO., INC., The Mines Adjudication Board,
Provincial Mining Regulatory Board (PMRB-DAVAO), MONKAYO INTEGRATED SMALL SCALE MINERS
ASSOCIATION, INC., ROSENDO VILLAFLOR, DAVAO UNITED MINERS COOPERATIVE, ANTONIO DACUDAO,
PUTING-BATO GOLD MINERS COOPERATIVE, ROMEO ALTAMERA, THELMA CATAPANG, LUIS GALANG,
RENATO BASMILLO, FRANCISCO YOBIDO, EDUARDO GLORIA, EDWIN ASION, MACARIO HERNANDEZ,
REYNALDO CARUBIO, ROBERTO BUNIALES, RUDY ESPORTONO, ROMEO CASTILLO, JOSE REA, GIL GANADO,
PRIMITIVA LICAYAN, LETICIA ALQUEZA and JOEL BRILLANTES Management Mining Corporation,
Respondents.
x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 152870-71
THE MINES ADJUDICATION BOARD AND ITS MEMBERS, THE HON. VICTOR O. RAMOS (Chairman),
UNDERSECRETARY VIRGILIO MARCELO (Member) and DIRECTOR HORACIO RAMOS (Member), petitioners,
vs.
SOUTHEAST MINDANAO GOLD MINING CORPORATION, Respondent.
RESOLUTION
CHICO-NAZARIO, J.:
This resolves the motion for reconsideration dated 12 July 2006, filed by Southeast Mindanao Gold Mining
Corporation (SEM), of this Court’s Decision dated 23 June 2006 (Assailed Decision). The Assailed Decision held
that the assignment of Exploration Permit (EP) 133 in favor of SEM violated one of the conditions stipulated in
the permit, i.e., that the same shall be for the exclusive use and benefit of Marcopper Mining Corporation
(MMC) or its duly authorized agents. Since SEM did not claim or submit evidence that it was a designated
agent of MMC, the latter cannot be considered as an agent of the former that can use EP 133 and benefit from
it. It also ruled that the transfer of EP 133 violated Presidential Decree No. 463, which requires that the
assignment of a mining right be made with the prior approval of the Secretary of the Department of
Environment and Natural Resources (DENR). Moreover, the Assailed Decision pointed out that EP 133 expired
by non-renewal since it was not renewed before or after its expiration.
The Assailed Decision likewise upheld the validity of Proclamation No. 297 absent any question against its
validity. In view of this, and considering that under Section 5 of Republic Act No. 7942, otherwise known as
the "Mining Act of 1995," mining operations in mineral reservations may be undertaken directly by the State or
through a contractor, the Court deemed the issue of ownership of priority right over the contested Diwalwal
Gold Rush Area as having been overtaken by the said proclamation. Thus, it was held in the Assailed Decision
that it is now within the prerogative of the Executive Department to undertake directly the mining operations
of the disputed area or to award the operations to private entities including petitioners Apex and Balite,
subject to applicable laws, rules and regulations, and provided that these private entities are qualified.
SEM also filed a Motion for Referral of Case to the Court En Banc and for Oral Arguments dated 22 August
2006.
Apex, for its part, filed a Motion for Clarification of the Assailed Decision, praying that the Court elucidate on
the Decision’s pronouncement that "mining operations, are now, therefore within the full control of the State
through the executive branch." Moreover, Apex asks this Court to order the Mines and Geosciences Board
(MGB) to accept its application for an exploration permit.
In its Manifestation and Motion dated 28 July 2006, Balite echoes the same concern as that of Apex on the
actual takeover by the State of the mining industry in the disputed area to the exclusion of the private sector.
In addition, Balite prays for this Court to direct MGB to accept its application for an exploration permit.
Camilo Banad, et al., likewise filed a motion for reconsideration and prayed that the disputed area be awarded
to them.
In the Resolution dated 15 April 2008, the Court En Banc resolved to accept the instant cases. The Court, in a
resolution dated 29 April 2008, resolved to set the cases for Oral Argument on 1 July 2008.
During the Oral Argument, the Court identified the following principal issues to be discussed by the parties:
1. Whether the transfer or assignment of Exploration Permit (EP) 133 by MMC to SEM was validly made
without violating any of the terms and conditions set forth in Presidential Decree No. 463 and EP 133 itself.
2. Whether Southeast Mindanao Mining Corp. acquired a vested right over the disputed area, which constitutes
a property right protected by the Constitution.
3. Whether the assailed Decision dated 23 June 2006 of the Third Division in this case is contrary to and
overturns the earlier Decision of this Court in Apex v. Garcia (G.R. No. 92605, 16 July 1991, 199 SCRA 278).
4. Whether the issuance of Proclamation No. 297 declaring the disputed area as mineral reservation outweighs
the claims of SEM, Apex Mining Co. Inc. and Balite Communal Portal Mining Cooperative over the Diwalwal
Gold Rush Area.
5. Whether the issue of the legality/constitutionality of Proclamation No. 297 was belatedly raised.
6. Assuming that the legality/constitutionality of Proclamation No. 297 was timely raised, whether said
proclamation violates any of the following:
a. Article XII, Section 4 of the Constitution;
b. Section 1 of Republic Act No. 3092;
c. Section 14 of the Administrative Code of 1987;
d. Section 5(a) of Republic Act No. 7586;
e. Section 4(a) of Republic Act No. 6657; and
f. Section 2, Subsection 2.1.2 of Executive Order No. 318 dated 9 June 2004.
After hearing the arguments of the parties, the Court required them to submit their respective memoranda.
Memoranda were accordingly filed by SEM, Apex, Balite and Mines Adjudication Board (MAB).
We shall resolve the second issue before dwelling on the first, third and the rest of the issues.
MMC or SEM Did Not Have Vested Rights Over the Diwalwal Gold Rush Area
Petitioner SEM vigorously argues that Apex Mining Co., Inc. v. Garcia1 vested in MMC mining rights over the
disputed area. It claims that the mining rights that MMC acquired under the said case were the ones assigned
to SEM, and not the right to explore under MMC’s EP 133. It insists that mining rights, once obtained, continue
to subsist regardless of the validity of the exploration permit; thus, mining rights are independent of the
exploration permit and therefore do not expire with the permit. SEM insists that a mining right is a vested
property right that not even the government can take away. To support this thesis, SEM cites this Court’s
ruling in McDaniel v. Apacible and Cuisia2 and in Gold Creek Mining Corporation v. Rodriguez,3 which were
decided in 1922 and 1938, respectively.
McDaniel and Gold Creek Mining Corporation are not in point.
In 1916, McDaniel, petitioner therein, located minerals, i.e., petroleum, on an unoccupied public land and
registered his mineral claims with the office of the mining recorder pursuant to the Philippine Bill of 1902,
where a mining claim locator, soon after locating the mine, enjoyed possessory rights with respect to such
mining claim with or without a patent therefor. In that case, the Agriculture Secretary, by virtue of Act No.
2932, approved in 1920, which provides that "all public lands may be leased by the then Secretary of
Agriculture and Natural Resources," was about to grant the application for lease of therein respondent,
overlapping the mining claims of the subject petitioner. Petitioner argued that, being a valid locator, he had
vested right over the public land where his mining claims were located. There, the Court ruled that the mining
claim perfected under the Philippine Bill of 1902, is "property in the highest sense of that term, which may be
sold and conveyed, and will pass by descent, and is not therefore subject to the disposal of the Government."
The Court then declared that since petitioner had already perfected his mining claim under the Philippine Bill of
1902, a subsequent statute, i.e., Act No. 2932, could not operate to deprive him of his already perfected
mining claim, without violating his property right.
Gold Creek Mining reiterated the ruling in McDaniel that a perfected mining claim under the Philippine Bill of
1902 no longer formed part of the public domain; hence, such mining claim does not come within the
prohibition against the alienation of natural resources under Section 1, Article XII of the 1935 Constitution.
Gleaned from the ruling on the foregoing cases is that for this law to apply, it must be established that the
mining claim must have been perfected when the Philippine Bill of 1902 was still in force and effect. This is so
because, unlike the subsequent laws that prohibit the alienation of mining lands, the Philippine Bill of 1902
sanctioned the alienation of mining lands to private individuals. The Philippine Bill of 1902 contained provisions
for, among many other things, the open and free exploration, occupation and purchase of mineral deposits
and the land where they may be found. It declared "all valuable mineral deposits in public lands in the
Philippine Islands, both surveyed and unsurveyed x x x to be free and open to exploration, occupation, and
purchase, and the land in which they are found to occupation and purchase, by citizens of the United States,
or of said Islands x x x."4 Pursuant to this law, the holder of the mineral claim is entitled to all the minerals
that may lie within his claim, provided he does three acts: First, he enters the mining land and locates a plot of
ground measuring, where possible, but not exceeding, one thousand feet in length by one thousand feet in
breadth, in as nearly a rectangular form as possible.5 Second, the mining locator has to record the mineral
claim in the mining recorder within thirty (30) days after the location thereof.6 Lastly, he must comply with the
annual actual work requirement.7 Complete mining rights, namely, the rights to explore, develop and utilize,
are acquired by a mining locator by simply following the foregoing requirements.1avvphi1
With the effectivity of the 1935 Constitution, where the regalian doctrine was adopted, it was declared that all
natural resources of the Philippines, including mineral lands and minerals, were property belonging to the
State.8 Excluded, however, from the property of public domain were the mineral lands and minerals that were
located and perfected by virtue of the Philippine Bill of 1902, since they were already considered private
properties of the locators.9
Commonwealth Act No. 137 or the Mining Act of 1936, which expressly adopted the regalian doctrine following
the provision of the 1935 Constitution, also proscribed the alienation of mining lands and granted only lease
rights to mining claimants, who were prohibited from purchasing the mining claim itself.
When Presidential Decree No. 463, which revised Commonwealth Act No. 137, was in force in 1974, it likewise
recognized the regalian doctrine embodied in the 1973 Constitution. It declared that all mineral deposits and
public and private lands belonged to the state while, nonetheless, recognizing mineral rights that had already
been existing under the Philippine Bill of 1902 as being beyond the purview of the regalian doctrine.10 The
possessory rights of mining claim holders under the Philippine Bill of 1902 remained intact and effective, and
such rights were recognized as property rights that the holders could convey or pass by descent.11
In the instant cases, SEM does not aver or prove that its mining rights had been perfected and completed
when the Philippine Bill of 1902 was still the operative law. Surely, it is impossible for SEM to successfully
assert that it acquired mining rights over the disputed area in accordance with the same bill, since it was only
in 1984 that MMC, SEM’s predecessor-in-interest, filed its declaration of locations and its prospecting permit
application in compliance with Presidential Decree No. 463. It was on 1 July 1985 and 10 March 1986 that a
Prospecting Permit and EP 133, respectively, were issued to MMC. Considering these facts, there is no
possibility that MMC or SEM could have acquired a perfected mining claim under the auspices of the Philippine
Bill of 1902. Whatever mining rights MMC had that it invalidly transferred to SEM cannot, by any stretch of
imagination, be considered "mining rights" as contemplated under the Philippine Bill of 1902 and immortalized
in McDaniel and Gold Creek Mining.
SEM likens EP 133 with a building permit. SEM likewise equates its supposed rights attached to the exploration
permit with the rights that a private property land owner has to said landholding. This analogy has no basis in
law. As earlier discussed, under the 1935, 1973 and 1987 Constitutions, national wealth, such as mineral
resources, are owned by the State and not by their discoverer. The discoverer or locator can only develop and
utilize said minerals for his own benefit if he has complied with all the requirements set forth by applicable
laws and if the State has conferred on him such right through permits, concessions or agreements. In other
words, without the imprimatur of the State, any mining aspirant does not have any definitive right over the
mineral land because, unlike a private landholding, mineral land is owned by the State, and the same cannot
be alienated to any private person as explicitly stated in Section 2, Article XIV of the 1987 Constitution:
All lands of public domain, waters, minerals x x x and all other natural resources are owned by the State. With
the exception of agricultural lands, all other natural resources shall not be alienated. (Emphases supplied.)
Further, a closer scrutiny of the deed of assignment in favor of SEM reveals that MMC assigned to the former
the rights and interests it had in EP 133, thus:
1. That for ONE PESO (₱1.00) and other valuable consideration received by the ASSIGNOR from the
ASSIGNEE, the ASSIGNOR hereby ASSIGNS, TRANSFERS and CONVEYS unto the ASSIGNEE whatever rights or
interest the ASSIGNOR may have in the area situated in Monkayo, Davao del Norte and Cateel, Davao
Oriental, identified as Exploration Permit No. 133 and Application for a Permit to Prospect in Bunawan, Agusan
del Sur respectively. (Emphasis supplied.)
It is evident that what MMC had over the disputed area during the assignment was an exploration permit.
Clearly, the right that SEM acquired was limited to exploration, only because MMC was a mere holder of an
exploration permit. As previously explained, SEM did not acquire the rights inherent in the permit, as the
assignment by MMC to SEM was done in violation of the condition stipulated in the permit, and the assignment
was effected without the approval of the proper authority in contravention of the provision of the mining law
governing at that time. In addition, the permit expired on 6 July 1994. It is, therefore, quite clear that SEM has
no right over the area.
Even assuming arguendo that SEM obtained the rights attached in EP 133, said rights cannot be considered as
property rights protected under the fundamental law.
An exploration permit does not automatically ripen into a right to extract and utilize the minerals; much less
does it develop into a vested right. The holder of an exploration permit only has the right to conduct
exploration works on the area awarded. Presidential Decree No. 463 defined exploration as "the examination
and investigation of lands supposed to contain valuable minerals, by drilling, trenching, shaft sinking,
tunneling, test pitting and other means, for the purpose of probing the presence of mineral deposits and the
extent thereof." Exploration does not include development and exploitation of the minerals found.
Development is defined by the same statute as the steps necessarily taken to reach an ore body or mineral
deposit so that it can be mined, whereas exploitation is defined as "the extraction and utilization of mineral
deposits." An exploration permit is nothing more than a mere right accorded to its holder to be given priority in
the government’s consideration in the granting of the right to develop and utilize the minerals over the area.
An exploration permit is merely inchoate, in that the holder still has to comply with the terms and conditions
embodied in the permit. This is manifest in the language of Presidential Decree No. 463, thus:
Sec. 8. x x x The right to exploit therein shall be awarded by the President under such terms and conditions as
recommended by the Director and approved by the Secretary Provided, That the persons or corporations who
undertook prospecting and exploration of said area shall be given priority.
In La Bugal-B’laan Tribal Association, Inc. v. Ramos,12 this Court emphasized:
Pursuant to Section 20 of RA 7942, an exploration permit merely grants to a qualified person the right to
conduct exploration for all minerals in specified areas. Such a permit does not amount to an authorization to
extract and carry off the mineral resources that may be discovered. x x x.
Pursuant to Section 24 of RA 7942, an exploration permit grantee who determines the commercial viability of a
mining area may, within the term of the permit, file with the MGB a declaration of mining project feasibility
accompanied by a work program for development. The approval of the mining project feasibility and
compliance with other requirements of RA 7942 vests in the grantee the exclusive right to an MPSA or any
other mineral agreement, or to an FTAA. (Underscoring ours.)
The non-acquisition by MMC or SEM of any vested right over the disputed area is supported by this Court’s
ruling in Southeast Mindanao Gold Mining Corporation v. Balite Portal Mining Cooperative13 :
Clearly then, the Apex Mining case did not invest petitioner with any definite right to the Diwalwal mines which
it could now set up against respondent BCMC and other mining groups.
Incidentally, it must likewise be pointed out that under no circumstances may petitioner’s rights under EP No.
133 be regarded as total and absolute. 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. x x x. (Underscoring supplied.)
Unfortunately, SEM cannot be given priority to develop and exploit the area covered by EP 133 because, as
discussed in the assailed Decision, EP 133 expired by non-renewal on 6 July 1994. Also, as already mentioned,
the transfer of the said permit to SEM was without legal effect because it was done in contravention of
Presidential Decree No. 463 which requires prior approval from the proper authority. Simply told, SEM holds
nothing for it to be entitled to conduct mining activities in the disputed mineral land.
SEM wants to impress on this Court that its alleged mining rights, by virtue of its being a transferee of EP 133,
is similar to a Financial and Technical Assistance Agreement (FTAA) of a foreign contractor, which merits
protection by the due process clause of the Constitution. SEM cites La Bugal-B’laan Tribal Association, Inc. v.
Ramos,14 as follows:
To say that an FTAA is just like a mere timber license or permit and does not involve contract or property
rights which merit protection by the due process clause of the Constitution, and may therefore be revoked or
cancelled in the blink of an eye, is to adopt a well-nigh confiscatory stance; at the very least, it is downright
dismissive of the property rights of businesspersons and corporate entities that have investments in the mining
industry, whose investments, operations and expenditures do contribute to the general welfare of the people,
the coffers of government, and the strength of the economy. x x x.
Again, this argument is not meritorious. SEM did not acquire the rights attached to EP 133, since their transfer
was without legal effect. Granting for the sake of argument that SEM was a valid transferee of the permit, its
right is not that of a mining contractor. An exploration permit grantee is vested with the right to conduct
exploration only, while an FTAA or MPSA contractor is authorized to extract and carry off the mineral resources
that may be discovered in the area.15 An exploration permit holder still has to comply with the mining project
feasibility and other requirements under the mining law. It has to obtain approval of such accomplished
requirements from the appropriate government agencies. Upon obtaining this approval, the exploration permit
holder has to file an application for an FTAA or an MPSA and have it approved also. Until the MPSA application
of SEM is approved, it cannot lawfully claim that it possesses the rights of an MPSA or FTAA holder, thus:
x x x prior to the issuance of such FTAA or mineral agreement, the exploration permit grantee (or prospective
contractor) cannot yet be deemed to have entered into any contract or agreement with the State x x x.16
But again, SEM is not qualified to apply for an FTAA or any mineral agreement, considering that it is not a
holder of a valid exploration permit, since EP 133 expired by non-renewal and the transfer to it of the same
permit has no legal value.
More importantly, assuming arguendo that SEM has a valid exploration permit, it cannot assert any mining
right over the disputed area, since the State has taken over the mining operations therein, pursuant to
Proclamation No. 297 issued by the President on 25 November 2002. The Court has consistently ruled that the
nature of a natural resource exploration permit is analogous to that of a license. In Republic v. Rosemoor
Mining and Development Corporation, this Court articulated:
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.17 (Emphasis supplied.)
As a mere license or privilege, an exploration permit can be validly amended by the President of the Republic
when national interests suitably necessitate. The Court instructed thus:
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 the public welfare is promoted. x x x They may
be validly amended, modified, replaced or rescinded by the Chief Executive when national interests so
require.18
Recognizing the importance of the country’s natural resources, not only for national economic development,
but also for its security and national defense, Section 5 of Republic Act No. 7942 empowers the President,
when the national interest so requires, to establish mineral reservations where mining operations shall be
undertaken directly by the State or through a contractor, viz:
SEC 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 x x x. (Emphasis supplied.)
Due to the pressing concerns in the Diwalwal Gold Rush Area brought about by unregulated small to medium-
scale mining operations causing ecological, health and peace and order problems, the President, on 25
November 2002, issued Proclamation No. 297, which declared the area as a mineral reservation and as an
environmentally critical area. This executive fiat was aimed at preventing the further dissipation of the natural
environment and rationalizing the mining operations in the area in order to attain an orderly balance between
socio-economic growth and environmental protection. The area being a mineral reservation, the Executive
Department has full control over it pursuant to Section 5 of Republic Act No. 7942. It can either directly
undertake the exploration, development and utilization of the minerals found therein, or it can enter into
agreements with qualified entities. Since the Executive Department now has control over the exploration,
development and utilization of the resources in the disputed area, SEM’s exploration permit, assuming that it is
still valid, has been effectively withdrawn. The exercise of such power through Proclamation No. 297 is in
accord with jura regalia, where the State exercises its sovereign power as owner of lands of the public domain
and the mineral deposits found within. Thus, Article XII, Section 2 of the 1987 Constitution emphasizes:
SEC. 2. All lands of the public domain, water, minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned
by the State. With the exception of agricultural lands, all other natural resources shall not be alienated. The
exploration, development, and utilization of natural resources shall be under the full control and supervision of
the State. The State may directly undertake such activities, or it may enter into co-production, joint venture, or
product-sharing agreements with Filipino citizens, or corporations or associations at least sixty per centum of
whose capital is owned by such citizens. (Emphasis supplied.)
Furthermore, said proclamation cannot be denounced as offensive to the fundamental law because the State is
sanctioned to do so in the exercise of its police power.19 The issues on health and peace and order, as well
the decadence of the forest resources brought about by unregulated mining in the area, are matters of
national interest. The declaration of the Chief Executive making the area a mineral reservation, therefore, is
sanctioned by Section 5 of Republic Act No. 7942.
The Assignment of EP No. 133 by MMC in Favor of SEM Violated Section 97 of Presidential Decree No. 463 and
the Terms and Conditions Set Forth in the Permit
SEM claims that the approval requirement under Section 97 of Presidential Decree No. 463 is not applicable to
this case, because MMC neither applied for nor was granted a mining lease contract. The said provision states:
SEC. 97. Assignment of Mining Rights. – A mining lease contract or any interest therein shall not be
transferred, assigned, or subleased without the prior approval of the Secretary: Provided, that such transfer,
assignment or sublease may be made only to a qualified person possessing the resources and capability to
continue the mining operations of the lessee and that the assignor has complied with all the obligations of the
lease: Provided, further, That such transfer or assignment shall be duly registered with the office of the mining
recorder concerned. (Emphasis supplied.)
Exploration Permit 133 was issued in favor of MMC on 10 March 1986, when Presidential Decree No. 463 was
still the governing law. Presidential Decree No. 463 pertains to the old system of exploration, development and
utilization of natural resources through "license, concession or lease."20
Pursuant to this law, a mining lease contract confers on the lessee or his successors the right to extract, to
remove, process and utilize the mineral deposits found on or underneath the surface of his mining claims
covered by the lease. The lessee may also enter into a service contract for the exploration, development and
exploitation of the minerals from the lands covered by his lease, to wit:
SEC. 44. A mining lease contract shall grant to the lessee, his heirs, successors, and assigns the right to
extract all mineral deposits found on or underneath the surface of his mining claims covered by the lease,
continued vertically downward; to remove, process, and otherwise utilize the mineral deposits for his own
benefit; and to use the lands covered by the lease for the purpose or purposes specified therein x x x That a
lessee may on his own or through the Government, enter into a service contract… for the exploration,
development and exploitation of his claims and the processing and marketing of the product thereof, subject
to the rules and regulations that shall be promulgated by the Director, with the approval of the Secretary x x
x. (Emphases supplied.)
In other words, the lessee’s interests are not only limited to the extraction or utilization of the minerals in the
contract area, but also to include the right to explore and develop the same. This right to explore the mining
claim or the contract area is derived from the exploration permit duly issued by the proper authority. An
exploration permit is, thus, covered by the term "any other interest therein." Section 97 is entitled,
"Assignment of Mining Rights." This alone gives a hint that before mining rights -- namely, the rights to
explore, develop and utilize -- are transferred or assigned, prior approval must be obtained from the DENR
Secretary. An exploration permit, thus, cannot be assigned without the imprimatur of the Secretary of the
DENR.
It is instructive to note that under Section 13 of Presidential Decree No. 463, the prospecting and exploration
of minerals in government reservations, such as forest reservations, are prohibited, except with the permission
of the government agency concerned. It is the government agency concerned that has the prerogative to
conduct prospecting, exploration and exploitation of such reserved lands.21 It is only in instances wherein said
government agency, in this case the Bureau of Mines, cannot undertake said mining operations that qualified
persons may be allowed by the government to undertake such operations. PNOC-EDC v. Veneracion, Jr.22
outlines the five requirements for acquiring mining rights in reserved lands under Presidential Decree No. 463:
(1) a prospecting permit from the agency that has jurisdiction over the land; (2) an exploration permit from
the Bureau of Mines and Geo-Sciences (BMGS); (3) if the exploration reveals the presence of commercial
deposit, application to BMGS by the permit holder for the exclusion of the area from the reservation; (4) a
grant by the President of the application to exclude the area from the reservation; and (5) a mining agreement
(lease, license or concession) approved by the DENR Secretary.
Here, MMC met the first and second requirements and obtained an exploration permit over the disputed forest
reserved land. Although MMC still has to prove to the government that it is qualified to develop and utilize the
subject mineral land, as it has yet to go through the remaining process before it can secure a lease
agreement, nonetheless, it is bound to follow Section 97 of Presidential Decree No. 463. The logic is not hard
to discern. If a lease holder, who has already demonstrated to the government his capacity and qualifications
to further develop and utilize the minerals within the contract area, is prohibited from transferring his mining
rights (rights to explore, develop and utilize), with more reason will this proscription apply with extra force to a
mere exploration permit holder who is yet to exhibit his qualifications in conducting mining operations. The
rationale for the approval requirement under Section 97 of Presidential Decree No. 463 is not hard to see.
Exploration permits are strictly granted to entities or individuals possessing the resources and capability to
undertake mining operations. Mining industry is a major support of the national economy and the continuous
and intensified exploration, development and wise utilization of mining resources is vital for national
development. For this reason, Presidential Decree No. 463 makes it imperative that in awarding mining
operations, only persons possessing the financial resources and technical skill for modern exploratory and
development techniques are encouraged to undertake the exploration, development and utilization of the
country’s natural resources. The preamble of Presidential Decree No. 463 provides thus:
WHEREAS, effective and continuous mining operations require considerable outlays of capital and resources,
and make it imperative that persons possessing the financial resources and technical skills for modern
exploratory and development techniques be encouraged to undertake the exploration, development and
exploitation of our mineral resources;
The Court has said that a "preamble" is the key to understanding the statute, written to open the minds of the
makers to the mischiefs that are to be remedied, and the purposes that are to be accomplished, by the
provisions of the statute.23 As such, when the statute itself is ambiguous and difficult to interpret, the
preamble may be resorted to as a key to understanding the statute.
Indubitably, without the scrutiny by the government agency as to the qualifications of the would-be transferee
of an exploration permit, the same may fall into the hands of non-qualified entities, which would be counter-
productive to the development of the mining industry. It cannot be overemphasized that the exploration,
development and utilization of the country’s natural resources are matters vital to the public interest and the
general welfare; hence, their regulation must be of utmost concern to the government, since these natural
resources are not only critical to the nation’s security, but they also ensure the country’s survival as a viable
and sovereign republic.24
The approval requirement of the Secretary of the DENR for the assignment of exploration permits is bolstered
by Section 25 of Republic Act No. 7942 (otherwise known as the Philippine Mining Act of 1995), which provides
that:
Sec. 25. Transfer or Assignment. – An exploration permit may be transferred or assigned to a qualified person
subject to the approval of the Secretary upon the recommendation of the Director.
SEM further posits that Section 97 of Presidential Decree No. 463, which requires the prior approval of the
DENR when there is a transfer of mining rights, cannot be applied to the assignment of EP 133 executed by
MMC in favor of SEM because during the execution of the Deed of Assignment on 16 February 1994, Executive
Order No. 27925 became the governing statute, inasmuch as the latter abrogated the old mining system --
i.e., license, concession or lease -- which was espoused by the former.
This contention is not well taken. While Presidential Decree No. 463 has already been repealed by Executive
Order No. 279, the administrative aspect of the former law nonetheless remains applicable. Hence, the
transfer or assignment of exploration permits still needs the prior approval of the Secretary of the DENR. As
ruled in Miners Association of the Philippines, Inc. v. Factoran, Jr.26 :
Presidential Decree No. 463, as amended, pertains to the old system of exploration, development and
utilization of natural resources through "license, concession or lease" which, however, has been disallowed by
Article XII, Section 2 of the 1987 Constitution. By virtue of the said constitutional mandate and its
implementing law, Executive Order No. 279, which superseded Executive Order No. 211, the provisions dealing
on "license, concession, or lease" of mineral resources under Presidential Decree No. 463, as amended, and
other existing mining laws are deemed repealed and, therefore, ceased to operate as the governing law. In
other words, in all other areas of administration and management of mineral lands, the provisions of
Presidential Decree No. 463, as amended, and other existing mining laws, still govern. (Emphasis supplied.)
Not only did the assignment of EP 133 to SEM violate Section 97 of Presidential Decree No. 463, it likewise
transgressed one of the conditions stipulated in the grant of the said permit. The following terms and
conditions attached to EP 133 are as follows:27
1. That the permittee shall abide by the work program submitted with the application or statements made
later in support thereof, and which shall be considered as conditions and essential parts of this permit;
2. That permittee shall maintain a complete record of all activities and accounting of all expenditures incurred
therein subject to periodic inspection and verification at reasonable intervals by the Bureau of Mines at the
expense of the applicant;
3. That the permittee shall submit to the Director of Mines within 15 days after the end of each calendar
quarter a report under oath of a full and complete statement of the work done in the area covered by the
permit;
4. That the term of this permit shall be for two (2) years to be effective from this date, renewable for the
same period at the discretion of the Director of Mines and upon request of the applicant;
5. That the Director of Mines may at any time cancel this permit for violation of its provision or in case of
trouble or breach of peace arising in the area subject hereof by reason of conflicting interests without any
responsibility on the part of the government as to expenditures for exploration that might have been incurred,
or as to other damages that might have been suffered by the permittee;
6. That this permit shall be for the exclusive use and benefit of the permittee or his duly authorized agents and
shall be used for mineral exploration purposes only and for no other purpose.
It must be noted that under Section 9028 of Presidential Decree No. 463, which was the applicable statute
during the issuance of EP 133, the DENR Secretary, through the Director of the Bureau of Mines and
Geosciences, was charged with carrying out the said law. Also, under Commonwealth Act No. 136, also known
as "An Act Creating the Bureau of Mines," which was approved on 7 November 1936, the Director of Mines
had the direct charge of the administration of the mineral lands and minerals; and of the survey, classification,
lease or any other form of concession or disposition thereof under the Mining Act.29 This power of
administration included the power to prescribe terms and conditions in granting exploration permits to
qualified entities.
Thus, in the grant of EP 133 in favor of the MMC, the Director of the BMG acted within his power in laying
down the terms and conditions attendant thereto. MMC and SEM did not dispute the reasonableness of said
conditions.
Quite conspicuous is the fact that neither MMC nor SEM denied that they were unaware of the terms and
conditions attached to EP 133. MMC and SEM did not present any evidence that they objected to these
conditions. Indubitably, MMC wholeheartedly accepted these terms and conditions, which formed part of the
grant of the permit. MMC agreed to abide by these conditions. It must be accentuated that a party to a
contract cannot deny its validity, without outrage to one’s sense of justice and fairness, after enjoying its
benefits.30 Where parties have entered into a well-defined contractual relationship, it is imperative that they
should honor and adhere to their rights and obligations as stated in their contracts, because obligations arising
from these have the force of law between the contracting parties and should be complied with in good faith.31
Condition Number 6 categorically states that the permit shall be for the exclusive use and benefit of MMC or its
duly authorized agents. While it may be true that SEM, the assignee of EP 133, is a 100% subsidiary
corporation of MMC, records are bereft of any evidence showing that the former is the duly authorized agent
of the latter. This Court cannot condone such utter disregard on the part of MMC to honor its obligations under
the permit. Undoubtedly, having violated this condition, the assignment of EP 133 to SEM is void and has no
legal effect.
To boot, SEM squandered whatever rights it assumed it had under EP 133. On 6 July 1993, EP 133 was
extended for twelve more months or until 6 July 1994. MMC or SEM, however, never renewed EP 133 either
prior to or after its expiration. Thus, EP 133 expired by non-renewal on 6 July 1994. With the expiration of EP
133 on 6 July 1994, MMC lost any right to the Diwalwal Gold Rush Area.
The Assailed Decision Resolved Facts and Issues That Transpired after the Promulgation of Apex Mining Co.,
Inc. v. Garcia
SEM asserts that the 23 June 2006 Decision reversed the 16 July 1991 Decision of the Court en banc entitled,
"Apex Mining Co., Inc. v. Garcia."32
The assailed Decision DID NOT overturn the 16 July 1991 Decision in Apex Mining Co., Inc. v. Garcia.
It must be pointed out that what Apex Mining Co., Inc. v. Garcia resolved was the issue of which, between
Apex and MMC, availed itself of the proper procedure in acquiring the right to prospect and to explore in the
Agusan-Davao-Surigao Forest Reserve. Apex registered its Declarations of Location (DOL) with the then BMGS,
while MMC was granted a permit to prospect by the Bureau of Forest Development (BFD) and was
subsequently granted an exploration permit by the BMGS. Taking into consideration Presidential Decree No.
463, which provides that "mining rights within forest reservation can be acquired by initially applying for a
permit to prospect with the BFD and subsequently for a permit to explore with the BMGS," the Court therein
ruled that MMC availed itself of the proper procedure to validly operate within the forest reserve or
reservation.
While it is true that Apex Mining Co., Inc. v. Garcia settled the issue of which between Apex and MMC was
legally entitled to explore in the disputed area, such rights, though, were extinguished by subsequent events
that transpired after the decision was promulgated. These subsequent events, which were not attendant in
Apex Mining Co., Inc. v. Garcia33 dated 16 July 1991, are the following:
(1) the expiration of EP 133 by non-renewal on 6 July 1994;
(2) the transfer/assignment of EP 133 to SEM on 16 February 1994 which was done in violation to the
condition of EP 133 proscribing its transfer;
(3) the transfer/assignment of EP 133 to SEM is without legal effect for violating PD 463 which mandates that
the assignment of mining rights must be with the prior approval of the Secretary of the DENR.
Moreover, in Southeast Mindanao Gold Mining Corporation v. Balite Portal Mining Cooperative,34 the Court,
through Associate Justice Consuelo Ynares-Santiago (now retired), declared that Apex Mining Co., Inc. v.
Garcia did not deal with the issues of the expiration of EP 133 and the validity of the transfer of EP 133 to
SEM, viz:
Neither can the Apex Mining case foreclose any question pertaining to the continuing validity of EP No. 133 on
grounds which arose after the judgment in said case was promulgated. While it is true that the Apex Mining
case settled the issue of who between Apex and Marcopper validly acquired mining rights over the disputed
area by availing of the proper procedural requisites mandated by law, it certainly did not deal with the
question raised by the oppositors in the Consolidated Mines cases, i.e., whether EP No. 133 had already
expired and remained valid subsequent to its transfer by Marcopper to petitioner. (Emphasis supplied.)
What is more revealing is that in the Resolution dated 26 November 1992, resolving the motion for
reconsideration of Apex Mining Co., Inc. v. Garcia, the Court clarified that the ruling on the said decision was
binding only between Apex and MMC and with respect the particular issue raised therein. Facts and issues not
attendant to the said decision, as in these cases, are not settled by the same. A portion of the disposition of
the Apex Mining Co., Inc. v. Garcia Resolution dated 26 November 1992 decrees:
x x x The decision rendered in this case is conclusive only between the parties with respect to the particular
issue herein raised and under the set of circumstances herein prevailing. In no case should the decision be
considered as a precedent to resolve or settle claims of persons/entities not parties hereto. Neither is it
intended to unsettle rights of persons/entities which have been acquired or which may have accrued upon
reliance on laws passed by the appropriate agencies. (Emphasis supplied.)
The Issue of the Constitutionality of Proclamation Is Raised Belatedly
In its last-ditch effort to salvage its case, SEM contends that Proclamation No. 297, issued by President Gloria
Macapagal-Arroyo and declaring the Diwalwal Gold Rush Area as a mineral reservation, is invalid on the
ground that it lacks the concurrence of Congress as mandated by Section 4, Article XII of the Constitution;
Section 1 of Republic Act No. 3092; Section 14 of Executive Order No. 292, otherwise known as the
Administrative Code of 1987; Section 5(a) of Republic Act No. 7586, and Section 4(a) of Republic Act No.
6657.
It is well-settled that when questions of constitutionality are raised, the court can exercise its power of judicial
review only if the following requisites are present: (1) an actual and appropriate case exists; (2) there is a
personal and substantial interest of the party raising the constitutional question; (3) the exercise of judicial
review is pleaded at the earliest opportunity; and (4) the constitutional question is the lis mota of the case.
Taking into consideration the foregoing requisites of judicial review, it is readily clear that the third requisite is
absent. The general rule is that the question of constitutionality must be raised at the earliest opportunity, so
that if it is not raised in the pleadings, ordinarily it may not be raised at the trial; and if not raised in the trial
court, it will not be considered on appeal.35
In the instant case, it must be pointed out that in the Reply to Respondent SEM’s Consolidated Comment filed
on 20 May 2003, MAB mentioned Proclamation No. 297, which was issued on 25 November 2002. This
proclamation, according to the MAB, has rendered SEM’s claim over the contested area moot, as the President
has already declared the same as a mineral reservation and as an environmentally critical area. SEM did not
put to issue the validity of said proclamation in any of its pleadings despite numerous opportunities to question
the same. It was only after the assailed Decision was promulgated -- i.e., in SEM’s Motion for Reconsideration
of the questioned Decision filed on 13 July 2006 and its Motion for Referral of the Case to the Court En Banc
and for Oral Arguments filed on 22 August 2006 -- that it assailed the validity of said proclamation.
Certainly, posing the question on the constitutionality of Proclamation No. 297 for the first time in its Motion
for Reconsideration is, indeed, too late.36
In fact, this Court, when it rendered the Decision it merely recognized that the questioned proclamation came
from a co-equal branch of government, which entitled it to a strong presumption of constitutionality.37 The
presumption of its constitutionality stands inasmuch as the parties in the instant cases did not question its
validity, much less present any evidence to prove that the same is unconstitutional. This is in line with the
precept that administrative issuances have the force and effect of law and that they benefit from the same
presumption of validity and constitutionality enjoyed by statutes.38
Proclamation No. 297 Is in Harmony with Article XII, Section 4, of the Constitution
At any rate, even if this Court were to consider the arguments belatedly raised by SEM, said arguments are
not meritorious.
SEM asserts that Article XII, Section 4 of the Constitution, bars the President from excluding forest
reserves/reservations and proclaiming the same as mineral reservations, since the power to de-classify them
resides in Congress.
Section 4, Article XII of the Constitution reads:
The Congress shall as soon as possible, determine by law the specific limits of forest lands and national parks,
marking clearly their boundaries on the ground. Thereafter, such forest lands and national parks shall be
conserved and may not be increased nor diminished, except by law. The Congress shall provide, for such
periods as it may determine, measures to prohibit logging in endangered forests and in watershed areas.
The above-quoted provision says that the area covered by forest lands and national parks may not be
expanded or reduced, unless pursuant to a law enacted by Congress. Clear in the language of the
constitutional provision is its prospective tenor, since it speaks in this manner: "Congress shall as soon as
possible." It is only after the specific limits of the forest lands shall have been determined by the legislature
will this constitutional restriction apply. SEM does not allege nor present any evidence that Congress had
already enacted a statute determining with specific limits forest lands and national parks. Considering the
absence of such law, Proclamation No. 297 could not have violated Section 4, Article XII of the 1987
Constitution. In PICOP Resources, Inc. v. Base Metals Mineral Resources Corporation,39 the Court had the
occasion to similarly rule in this fashion:
x x x Sec. 4, Art. XII of the 1987 Constitution, on the other hand, provides that Congress shall determine the
specific limits of forest lands and national parks, marking clearly their boundaries on the ground. Once this is
done, the area thus covered by said forest lands and national parks may not be expanded or reduced except
also by congressional legislation. Since Congress has yet to enact a law determining the specific limits of the
forest lands covered by Proclamation No. 369 and marking clearly its boundaries on the ground, there can be
no occasion that could give rise to a violation of the constitutional provision.
Section 4, Article XII of the Constitution, addresses the concern of the drafters of the 1987 Constitution about
forests and the preservation of national parks. This was brought about by the drafters’ awareness and fear of
the continuing destruction of this country’s forests.40 In view of this concern, Congress is tasked to fix by law
the specific limits of forest lands and national parks, after which the trees in these areas are to be taken care
of.41 Hence, these forest lands and national parks that Congress is to delimit through a law could be changed
only by Congress.
In addition, there is nothing in the constitutional provision that prohibits the President from declaring a forest
land as an environmentally critical area and from regulating the mining operations therein by declaring it as a
mineral reservation in order to prevent the further degradation of the forest environment and to resolve the
health and peace and order problems that beset the area.
A closer examination of Section 4, Article XII of the Constitution and Proclamation No. 297 reveals that there is
nothing contradictory between the two. Proclamation No. 297, a measure to attain and maintain a rational and
orderly balance between socio-economic growth and environmental protection, jibes with the constitutional
policy of preserving and protecting the forest lands from being further devastated by denudation. In other
words, the proclamation in question is in line with Section 4, Article XII of the Constitution, as the former
fosters the preservation of the forest environment of the Diwalwal area and is aimed at preventing the further
degradation of the same. These objectives are the very same reasons why the subject constitutional provision
is in place.
What is more, jurisprudence has recognized the policy of multiple land use in our laws towards the end that
the country’s precious natural resources may be rationally explored, developed, utilized and conserved.42 It
has been held that forest reserves or reservations can at the same time be open to mining operations,
provided a prior written clearance by the government agency having jurisdiction over such reservation is
obtained. In other words mineral lands can exist within forest reservations. These two terms are not anti-
thetical. This is made manifest if we read Section 47 of Presidential Decree No. 705 or the Revised Forestry
Code of the Philippines, which provides:
Mining operations in forest lands shall be regulated and conducted with due regard to protection, development
and utilization of other surface resources. Location, prospecting, exploration, utilization or exploitation of
mineral resources in forest reservations shall be governed by mining laws, rules and regulations. (Emphasis
supplied.)
Also, Section 6 of Republic Act No. 7942 or the Mining Act of 1995, states that mining operations in reserved
lands other than mineral reservations, such as forest reserves/reservations, are allowed, viz:
Mining operations in reserved lands other than mineral reservations may be undertaken by the Department,
subject to limitations as herein provided. In the event that the Department cannot undertake such activities,
they may be undertaken by a qualified person in accordance with the rules and regulations promulgated by
the Secretary. (Emphasis supplied.)
Since forest reservations can be made mineral lands where mining operations are conducted, then there is no
argument that the disputed land, which lies within a forest reservation, can be declared as a mineral
reservation as well.
Republic Act No. 7942 Otherwise Known as the "Philippine Mining Act of 1995," is the Applicable Law
Determined to rivet its crumbling cause, SEM then argues that Proclamation No. 297 is invalid, as it
transgressed the statutes governing the exclusion of areas already declared as forest reserves, such as Section
1 of Republic Act No. 3092,43 Section 14 of the Administrative Code of 1987, Section 5(a) of Republic Act No.
7586,44 and Section 4(a) of Republic Act No. 6657.45
Citing Section 1 of Republic Act No. 3092, which provides as follows:
Upon the recommendation of the Director of Forestry, with the approval of the Department Head, the
President of the Philippines shall set apart forest reserves which shall include denuded forest lands from the
public lands and he shall by proclamation declare the establishment of such forest reserves and the boundaries
thereof, and thereafter such forest reserves shall not be entered, or otherwise disposed of, but shall remain
indefinitely as such for forest uses.
The President of the Philippines may, in like manner upon the recommendation of the Director of Forestry,
with the approval of the Department head, by proclamation, modify the boundaries of any such forest reserve
to conform with subsequent precise survey but not to exclude any portion thereof except with the concurrence
of Congress. (Underscoring supplied.)
SEM submits that the foregoing provision is the governing statute on the exclusion of areas already declared
as forest reserves. Thus, areas already set aside by law as forest reserves are no longer within the
proclamation powers of the President to modify or set aside for any other purposes such as mineral
reservation.
To bolster its contention that the President cannot disestablish forest reserves into mineral reservations, SEM
makes reference to Section 14, Chapter 4, Title I, Book III of the Administrative Code of 1987, which partly
recites:
The President shall have the power to reserve for settlement or public use, and for specific public purposes,
any of the lands of the public domain, the use of which is not otherwise directed by law. The reserved land
shall thereafter remain subject to the specific public purpose indicated until otherwise provided by law or
proclamation. (Emphases supplied.)
SEM further contends that Section 7 of Republic Act No. 7586,46 which declares that the disestablishment of a
protected area shall be done by Congress, and Section 4(a) of Republic Act No. 6657,47 which in turn requires
a law passed by Congress before any forest reserve can be reclassified, militate against the validity of
Proclamation No. 297.
Proclamation No. 297, declaring a certain portion of land located in Monkayo, Compostela Valley, with an area
of 8,100 hectares, more or less, as a mineral reservation, was issued by the President pursuant to Section 5 of
Republic Act No. 7942, also known as the "Philippine Mining Act of 1995."
Proclamation No. 297 did not modify the boundaries of the Agusan-Davao-Surigao Forest Reserve since, as
earlier discussed, mineral reservations can exist within forest reserves because of the multiple land use policy.
The metes and bounds of a forest reservation remain intact even if, within the said area, a mineral land is
located and thereafter declared as a mineral reservation.
More to the point, a perusal of Republic Act No. 3092, "An Act to Amend Certain Sections of the Revised
Administrative Code of 1917," which was approved on 17 August 1961, and the Administrative Code of 1987,
shows that only those public lands declared by the President as reserved pursuant to these two statutes are to
remain subject to the specific purpose. The tenor of the cited provisions, namely: "the President of the
Philippines shall set apart forest reserves" and "the reserved land shall thereafter remain," speaks of future
public reservations to be declared, pursuant to these two statutes. These provisions do not apply to forest
reservations earlier declared as such, as in this case, which was proclaimed way back on 27 February 1931, by
Governor General Dwight F. Davis under Proclamation No. 369.
Over and above that, Section 5 of Republic Act No. 7942 authorizes the President to establish mineral
reservations, to wit:
Sec. 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 x x x. (Emphasis supplied.)
It is a rudimentary principle in legal hermeneutics that where there are two acts or provisions, one of which is
special and particular and certainly involves the matter in question, the other general, which, if standing alone,
would include the matter and thus conflict with the special act or provision, the special act must as intended
be taken as constituting an exception to the general act or provision, especially when such general and special
acts or provisions are contemporaneous, as the Legislature is not to be presumed to have intended a conflict.
Hence, it has become an established rule of statutory construction that where one statute deals with a subject
in general terms, and another deals with a part of the same subject in a more detailed way, the two should be
harmonized if possible; but if there is any conflict, the latter shall prevail regardless of whether it was passed
prior to the general statute. Or where two statutes are of contrary tenor or of different dates but are of equal
theoretical application to a particular case, the one specially designed therefor should prevail over the other.
It must be observed that Republic Act No. 3092, "An Act to Amend Certain Sections of the Revised
Administrative Code of 1917," and the Administrative Code of 1987, are general laws. Section 1 of Republic
Act No. 3092 and Section 14 of the Administrative Code of 1987 require the concurrence of Congress before
any portion of a forest reserve can be validly excluded therefrom. These provisions are broad since they deal
with all kinds of exclusion or reclassification relative to forest reserves, i.e., forest reserve areas can be
transformed into all kinds of public purposes, not only the establishment of a mineral reservation. Section 5 of
Republic Act No. 7942 is a special provision, as it specifically treats of the establishment of mineral
reservations only. Said provision grants the President the power to proclaim a mineral land as a mineral
reservation, regardless of whether such land is also an existing forest reservation.
Sec. 5(a) of Republic Act No. 7586 provides:
Sec. 5. Establishment and Extent of the System. — The establishment and operationalization of the System
shall involve the following:
(a) All areas or islands in the Philippines proclaimed, designated or set aside, pursuant to a law, presidential
decree, presidential proclamation or executive order as national park, game refuge, bird and wildlife sanctuary,
wilderness area, strict nature reserve, watershed, mangrove reserve, fish sanctuary, natural and historical
landmark, protected and managed landscape/seascape as well as identified virgin forests before the effectivity
of this Act are hereby designated as initial components of the System. The initial components of the System
shall be governed by existing laws, rules and regulations, not inconsistent with this Act.
Glaring in the foregoing enumeration of areas comprising the initial component of the NIPAS System under
Republic Act No. 7586 is the absence of forest reserves. Only protected areas enumerated under said provision
cannot be modified. Since the subject matter of Proclamation No. 297 is a forest reservation proclaimed as a
mineral reserve, Republic Act No. 7586 cannot possibly be made applicable. Neither can Proclamation No. 297
possibly violate said law.
Similarly, Section 4(a) of Republic Act No. 6657 cannot be made applicable to the instant case.
Section 4(a) of Republic Act No. 6657 reads:
All alienable and disposable lands of the public domain devoted to or suitable for agriculture. No
reclassification of forest or mineral lands to agricultural lands shall be undertaken after the approval of this Act
until Congress, taking into account ecological, developmental and equity considerations, shall have determined
by law, the specific limits of the public domain. (Underscoring supplied.)
Section 4(a) of Republic Act No. 6657 prohibits the reclassification of forest or mineral lands into agricultural
lands until Congress shall have determined by law the specific limits of the public domain. A cursory reading of
this provision will readily show that the same is not relevant to the instant controversy, as there has been no
reclassification of a forest or mineral land into an agricultural land.
Furthermore, the settled rule of statutory construction is that if two or more laws of different dates and of
contrary tenors are of equal theoretical application to a particular case, the statute of later date must prevail
being a later expression of legislative will.48
In the case at bar, there is no question that Republic Act No. 7942 was signed into law later than Republic Act
No. 3092, the Administrative Code of 1987,49 Republic Act No. 7586 and Republic Act No. 6657. Applying the
cited principle, the provisions of Republic Act No. 3092, the Administrative Code of 1987, Republic Act No.
7586 and Republic Act No. 6657 cited by SEM must yield to Section 5 of Republic Act No. 7942.
Camilo Banad, et al., Cannot Seek Relief from This Court
Camilo Banad and his group admit that they are members of the Balite Cooperative. They, however, claim that
they are distinct from Balite and move that this Court recognize them as prior mining locators.
Unfortunately for them, this Court cannot grant any relief they seek. Records reveal that although they were
parties to the instant cases before the Court of Appeals, they did not file a petition for review before this Court
to contest the decision of the appellate court. The only petitioners in the instant cases are the MAB, SEM,
Balite and Apex. Consequently, having no personality in the instant cases, they cannot seek any relief from
this Court.
Apex’s Motion for Clarification and Balite’s Manifestation and Motion
In its Motion for Clarification, Apex desires that the Court elucidate the assailed Decision’s pronouncement that
"mining operations, are now, therefore within the full control of the State through the executive branch" and
place the said pronouncement in the proper perspective as the declaration in La Bugal-B’Laan, which states
that –
The concept of control adopted in Section 2 of Article XII must be taken to mean less than dictatorial, all-
encompassing control; but nevertheless sufficient to give the State the power to direct, restrain, regulate and
govern the affairs of the extractive enterprise.50
Apex states that the subject portion of the assailed Decision could send a chilling effect to potential investors
in the mining industry, who may be of the impression that the State has taken over the mining industry, not as
regulator but as an operator. It is of the opinion that the State cannot directly undertake mining operations.
Moreover, Apex is apprehensive of the following portion in the questioned Decision– "The State can also opt to
award mining operations in the mineral reservation to private entities including petitioner Apex and Balite, if it
wishes." It avers that the phrase "if it wishes" may whimsically be interpreted to mean a blanket authority of
the administrative authority to reject the former’s application for an exploration permit even though it complies
with the prescribed policies, rules and regulations.1 a vv p h i 1
Apex likewise asks this Court to order the MGB to accept its application for an exploration permit.
Balite echoes the same concern as that of Apex on the actual take-over by the State of the mining industry in
the disputed area to the exclusion of the private sector. In addition, Balite prays that this Court direct MGB to
accept Balite’s application for an exploration permit.
Contrary to the contention of Apex and Balite, the fourth paragraph of Section 2, Article XII of the Constitution
and Section 5 of Republic Act No. 7942 sanctions the State, through the executive department, to undertake
mining operations directly, as an operator and not as a mere regulator of mineral undertakings. This is made
clearer by the fourth paragraph of Section 2, Article XII of the 1987 Constitution, which provides in part:
SEC. 2. x x x The State may directly undertake such activities, or it may enter into co-production, joint
venture, or production-sharing agreements with Filipino citizens, or corporations or associations at least sixty
per centum of whose capital is owned by such citizens. x x x. (Emphasis supplied.)
Also, Section 5 of Republic Act No. 7942 states that the mining operations in mineral reservations shall be
undertaken by the Department of Environment and Natural Resources or a contractor, to wit:
SEC. 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 x x x. (Emphasis supplied.)
Undoubtedly, the Constitution, as well as Republic Act No. 7942, allows the executive department to undertake
mining operations. Besides, La Bugal-B’Laan, cited by Apex, did not refer to the fourth sentence of Section 2,
Article XII of the Constitution, but to the third sentence of the said provision, which states:
SEC. 2. x x x The exploration, development, and utilization of natural resources shall be under the full control
and supervision of the State. x x x.
Pursuant to Section 5 of Republic Act No. 7942, the executive department has the option to undertake directly
the mining operations in the Diwalwal Gold Rush Area or to award mining operations therein to private
entities. The phrase "if it wishes" must be understood within the context of this provision. Hence, the Court
cannot dictate this co-equal branch to choose which of the two options to select. It is the sole prerogative of
the executive department to undertake directly or to award the mining operations of the contested area.
Even assuming that the proper authority may decide to award the mining operations of the disputed area, this
Court cannot arrogate unto itself the task of determining who, among the applicants, is qualified. It is the duty
of the appropriate administrative body to determine the qualifications of the applicants. It is only when this
administrative body whimsically denies the applications of qualified applicants that the Court may interfere. But
until then, the Court has no power to direct said administrative body to accept the application of any qualified
applicant.
In view of this, the Court cannot grant the prayer of Apex and Balite asking the Court to direct the MGB to
accept their applications pending before the MGB.
SEM’s Manifestation and Motion dated 25 January 2007
SEM wants to emphasize that its predecessor-in-interest, Marcopper or MMC, complied with the mandatory
exploration work program, required under EP 133, by attaching therewith quarterly reports on exploration
work from 20 June 1986 to March 1994.
It must be observed that this is the very first time at this very late stage that SEM has presented the quarterly
exploration reports. From the early phase of this controversy, SEM did not disprove the arguments of the other
parties that Marcopper violated the terms under EP 133, among other violations, by not complying with the
mandatory exploration work program. Neither did it present evidence for the appreciation of the lower
tribunals. Hence, the non-compliance with the mandatory exploration work program was not made an issue in
any stage of the proceedings. The rule is that an issue that was not raised in the lower court or tribunal
cannot be raised for the first time on appeal, as this would violate the basic rules of fair play, justice and due
process.51 Thus, this Court cannot take cognizance of the issue of whether or not MMC complied with the
mandatory work program.
In sum, this Court finds:
1. The assailed Decision did not overturn the 16 July 1991 Decision in Apex Mining Co., Inc. v. Garcia. The
former was decided on facts and issues that were not attendant in the latter, such as the expiration of EP 133,
the violation of the condition embodied in EP 133 prohibiting its assignment, and the unauthorized and invalid
assignment of EP 133 by MMC to SEM, since this assignment was effected without the approval of the
Secretary of DENR;
2. SEM did not acquire vested right over the disputed area because its supposed right was extinguished by the
expiration of its exploration permit and by its violation of the condition prohibiting the assignment of EP 133 by
MMC to SEM. In addition, even assuming that SEM has a valid exploration permit, such is a mere license that
can be withdrawn by the State. In fact, the same has been withdrawn by the issuance of Proclamation No.
297, which places the disputed area under the full control of the State through the Executive Department;
3. The approval requirement under Section 97 of Presidential Decree No. 463 applies to the assignment of EP
133 by MMC to SEM, since the exploration permit is an interest in a mining lease contract;
4. The issue of the constitutionality and the legality of Proclamation No. 297 was raised belatedly, as SEM
questions the same for the first time in its Motion for Reconsideration. Even if the issue were to be
entertained, the said proclamation is found to be in harmony with the Constitution and other existing statutes;
5. The motion for reconsideration of Camilo Banad, et al. cannot be passed upon because they are not parties
to the instant cases;
6. The prayers of Apex and Balite asking the Court to direct the MGB to accept their applications for
exploration permits cannot be granted, since it is the Executive Department that has the prerogative to accept
such applications, if ever it decides to award the mining operations in the disputed area to a private entity;
7. The Court cannot pass upon the issue of whether or not MMC complied with the mandatory exploration
work program, as such was a non-issue and was not raised before the Court of Appeals and the lower
tribunals.
WHEREFORE, premises considered, the Court holds:
1. The Motions for Reconsideration filed by Camilo Banad, et al. and Southeast Mindanao Gold Mining
Corporation are DENIED for lack of merit;
2. The Motion for Clarification of Apex Mining Co., Inc. and the Manifestation and Motion of the Balite
Communal Portal Mining Cooperative, insofar as these motions/manifestation ask the Court to direct the Mines
and Geo-Sciences Bureau to accept their respective applications for exploration permits, are DENIED;
3. The Manifestation and Urgent Motion dated 25 January 2007 of Southeast Mindanao Gold Mining
Corporation is DENIED.
4. The State, through the Executive Department, should it so desire, may now award mining operations in the
disputed area to any qualified entities it may determine. The Mines and Geosciences Bureau may process
exploration permits pending before it, taking into consideration the applicable mining laws, rules and
regulations relative thereto.
SO ORDERED.

13. REPUBLIC OF THE PHILIPPINES VS NAGULAT

G.R. No. 134209 January 24, 2006

REPUBLIC OF THE PHILIPPINES, Petitioner,
vs.
CELESTINA NAGUIAT, Respondent.
DECISION
GARCIA, J.:
Before the Court is this petition for review under Rule 45 of the Rules of Court seeking the reversal of the
Decision1 dated May 29, 1998 of the Court of Appeals (CA) in CA-G.R. CV No. 37001 which affirmed an earlier
decision2 of the Regional Trial Court at Iba, Zambales, Branch 69 in Land Registration Case No. N-25-1.
The decision under review recites the factual backdrop, as follows:
This is an application for registration of title to four (4) parcels of land located in Panan, Botolan, Zambales,
more particularly described in the amended application filed by Celestina Naguiat on 29 December 1989 with
the Regional Trial Court of Zambales, Branch 69. Applicant [herein respondent] alleges, inter alia, that she is
the owner of the said parcels of land having acquired them by purchase from the LID Corporation which
likewise acquired the same from Demetria Calderon, Josefina Moraga and Fausto Monje and their
predecessors-in-interest who have been in possession thereof for more than thirty (30) years; and that to the
best of her knowledge, said lots suffer no mortgage or encumbrance of whatever kind nor is there any person
having any interest, legal or equitable, or in possession thereof.
On 29 June 1990, the Republic of the Philippines [herein petitioner]. . . filed an opposition to the application
on the ground that neither the applicant nor her predecessors-in interest have been in open, continuous,
exclusive and notorious possession and occupation of the lands in question since 12 June 1945 or prior
thereto; that the muniments of title and tax payment receipts of applicant do not constitute competent and
sufficient evidence of a bona-fide acquisition of the lands applied for or of his open, continuous, exclusive and
notorious possession and occupation thereof in the concept of (an) owner; that the applicant’s claim of
ownership in fee simple on the basis of Spanish title or grant can no longer be availed of . . .; and that the
parcels of land applied for are part of the public domain belonging to the Republic of the Philippines not
subject to private appropriation.
On 15 October 1990, the lower court issued an order of general default as against the whole world, with the
exception of the Office of the Solicitor General, and proceeded with the hearing of this registration case.
After she had presented and formally offered her evidence . . . applicant rested her case. The Solicitor
General, thru the Provincial Prosecutor, interposed no objection to the admission of the exhibits. Later . . . the
Provincial Prosecutor manifest (sic) that the Government had no evidence to adduce. 3
In a decision4 dated September 30, 1991, the trial court rendered judgment for herein respondent Celestina
Naguiat, adjudicating unto her the parcels of land in question and decreeing the registration thereof in her
name, thus:
WHEREFORE, premises considered, this Court hereby adjudicates the parcels of land situated in Panan,
Botolan, Zambales, appearing on Plan AP-03-003447 containing an area of 3,131 square meters, appearing on
Plan AP-03-003446 containing an area of 15,322 containing an area of 15,387 square meters to herein
applicant Celestina T. Naguiat, of legal age, Filipino citizen, married to Rommel Naguiat and a resident of
Angeles City, Pampanga together with all the improvements existing thereon and orders and decrees
registration in her name in accordance with Act No. 496, Commonwealth Act No. 14, [should be 141] as
amended, and Presidential Decree No. 1529. This adjudication, however, is subject to the various
easements/reservations provided for under pertinent laws, presidential decrees and/or presidential letters of
instructions which should be annotated/ projected on the title to be issued. And once this decision becomes
final, let the corresponding decree of registration be immediately issued. (Words in bracket added)
With its motion for reconsideration having been denied by the trial court, petitioner Republic went on appeal to
the CA in CA-G.R. CV No. 37001.
As stated at the outset hereof, the CA, in the herein assailed decision of May 29, 1998, affirmed that of the
trial court, to wit:
WHEREFORE, premises considered, the decision appealed from is hereby AFFIRMED.
SO ORDERED.
Hence, the Republic’s present recourse on its basic submission that the CA’s decision "is not in accordance
with law, jurisprudence and the evidence, since respondent has not established with the required evidence her
title in fee simple or imperfect title in respect of the subject lots which would warrant their registration under
… (P.D. 1529 or Public Land Act (C.A.) 141." In particular, petitioner Republic faults the appellate court on its
finding respecting the length of respondent’s occupation of the property subject of her application for
registration and for not considering the fact that she has not established that the lands in question have been
declassified from forest or timber zone to alienable and disposable property.
Public forest lands or forest reserves, unless declassified and released by positive act of the Government so
that they may form part of the disposable agricultural lands of the public domain, are not capable of private
appropriation.5 As to these assets, the rules on confirmation of imperfect title do not apply.6 Given this
postulate, the principal issue to be addressed turns on the question of whether or not the areas in question
have ceased to have the status of forest or other inalienable lands of the public domain.
Forests, in the context of both the Public Land Act7 and the Constitution8 classifying lands of the public
domain into "agricultural, forest or timber, mineral lands and national parks," do not necessarily refer to a
large tract of wooded land or an expanse covered by dense growth of trees and underbrush. As we stated in
Heirs of Amunategui 9-
A forested area classified as forest land of the public domain does not lose such classification simply because
loggers or settlers have stripped it of its forest cover. Parcels of land classified as forest land may actually be
covered with grass or planted to crops by kaingin cultivators or other farmers. "Forest lands" do not have to be
on mountains or in out of the way places. xxx. The classification is merely descriptive of its legal nature or
status and does not have to be descriptive of what the land actually looks like. xxx
Under Section 2, Article XII of the Constitution,10 which embodies the Regalian doctrine, all lands of the public
domain belong to the State – the source of any asserted right to ownership of land.11 All lands not appearing
to be clearly of private dominion presumptively belong to the State.12 Accordingly, public lands not shown to
have been reclassified or released as alienable agricultural land or alienated to a private person by the State
remain part of the inalienable public domain.13 Under Section 6 of the Public Land Act, the prerogative of
classifying or reclassifying lands of the public domain, i.e., from forest or mineral to agricultural and vice versa,
belongs to the Executive Branch of the government and not the court.14 Needless to stress, the onus to
overturn, by incontrovertible evidence, the presumption that the land subject of an application for registration
is alienable or disposable rests with the applicant.15
In the present case, the CA assumed that the lands in question are already alienable and disposable. Wrote
the appellate court:
The theory of [petitioner] that the properties in question are lands of the public domain cannot be sustained
as it is directly against the above doctrine. Said doctrine is a reaffirmation of the principle established in the
earlier cases . . . that open, exclusive and undisputed possession of alienable public land for period prescribed
by law creates the legal fiction whereby the land, upon completion of the requisite period, ipso jure and
without the need of judicial or other sanction, ceases to be public land and becomes private property …. (Word
in bracket and underscoring added.)
The principal reason for the appellate court’s disposition, finding a registerable title for respondent, is her and
her predecessor-in-interest’s open, continuous and exclusive occupation of the subject property for more than
30 years. Prescinding from its above assumption and finding, the appellate court went on to conclude, citing
Director of Lands vs. Intermediate Appellate Court (IAC)16 and Herico vs. DAR,17 among other cases, that,
upon the completion of the requisite period of possession, the lands in question cease to be public land and
become private property.
Director of Lands, Herico and the other cases cited by the CA are not, however, winning cards for the
respondent, for the simple reason that, in said cases, the disposable and alienable nature of the land sought to
be registered was established, or, at least, not put in issue. And there lies the difference.
Here, respondent never presented the required certification from the proper government agency or official
proclamation reclassifying the land applied for as alienable and disposable. Matters of land classification or
reclassification cannot be assumed. It calls for proof.18 Aside from tax receipts, respondent submitted in
evidence the survey map and technical descriptions of the lands, which, needless to state, provided no
information respecting the classification of the property. As the Court has held, however, these documents are
not sufficient to overcome the presumption that the land sought to be registered forms part of the public
domain.19
It cannot be overemphasized that unwarranted appropriation of public lands has been a notorious practice
resorted to in land registration cases.20 For this reason, the Court has made it a point to stress, when
appropriate, that declassification of forest and mineral lands, as the case may be, and their conversion into
alienable and disposable lands need an express and positive act from the government.21
The foregoing considered, the issue of whether or not respondent and her predecessor-in-interest have been
in open, exclusive and continuous possession of the parcels of land in question is now of little moment. For,
unclassified land, as here, cannot be acquired by adverse occupation or possession; occupation thereof in the
concept of owner, however long, cannot ripen into private ownership and be registered as title.22
WHEREFORE, the instant petition is GRANTED and the assailed decision dated May 29, 1998 of the Court of
Appeals in CA-G.R. CV No. 37001 is REVERSED and SET ASIDE. Accordingly, respondent’s application for
original registration of title in Land Registration Case No. N-25-1 of the Regional Trial Court at Iba, Zambales,
Branch 69, is DENIED.
No costs.
SO ORDERED.

14. ARIGO VS SWIFT

G.R. No. 206510 September 16, 2014

MOST REV. PEDRO D. ARIGO, Vicar Apostolic of Puerto Princesa D.D.; MOST REV. DEOGRACIAS S. INIGUEZ,
JR., Bishop-Emeritus of Caloocan, FRANCES Q. QUIMPO, CLEMENTE G. BAUTISTA, JR., Kalikasan-PNE, MARIA
CAROLINA P. ARAULLO, RENATO M. REYES, JR., Bagong Alyansang Makabayan, HON. NERI JAVIER
COLMENARES, Bayan Muna Partylist, ROLAND G. SIMBULAN, PH.D., Junk VF A Movement, TERESITA R.
PEREZ, PH.D., HON. RAYMOND V. PALATINO, Kabataan Party-list, PETER SJ. GONZALES, Pamalakaya,
GIOVANNI A. TAPANG, PH. D., Agham, ELMER C. LABOG, Kilusang Mayo Uno, JOAN MAY E. SALVADOR,
Gabriela, JOSE ENRIQUE A. AFRICA, THERESA A. CONCEPCION, MARY JOAN A. GUAN, NESTOR T.
BAGUINON, PH.D., A. EDSEL F. TUPAZ, Petitioners,
vs.
SCOTT H. SWIFT in his capacity as Commander of the US. 7th Fleet, MARK A. RICE in his capacity as
Commanding Officer of the USS Guardian, PRESIDENT BENIGNO S. AQUINO III in his capacity as
Commander-in-Chief of the Armed Forces of the Philippines, HON. ALBERT F. DEL ROSARIO, Secretary,
pepartment of Foreign Affair.s, HON. PAQUITO OCHOA, JR., Executiv~.:Secretary, Office of the President, .
HON. VOLTAIRE T. GAZMIN, Secretary, Department of National Defense, HON. RAMON JESUS P. P AJE,
Secretary, Department of Environment and Natural Resoz!rces, VICE ADMIRAL JOSE LUIS M. ALANO,
Philippine Navy Flag Officer in Command, Armed Forces of the Philippines, ADMIRAL RODOLFO D. ISO RENA,
Commandant, Philippine Coast Guard, COMMODORE ENRICO EFREN EVANGELISTA, Philippine Coast Guard
Palawan, MAJOR GEN. VIRGILIO 0. DOMINGO, Commandant of Armed Forces of the Philippines Command and
LT. GEN. TERRY G. ROBLING, US Marine Corps Forces. Pacific and Balikatan 2013 Exercise Co-Director,
Respondents.
DECISION
VILLARAMA, JR, J.:
Before us is a petition for the issuance of a Writ of Kalikasan with prayer for the issuance of a Temporary
Environmental Protection Order (TEPO) under Rule 7 of A.M. No. 09-6-8-SC, otherwise known as the Rules of
Procedure for Environmental Cases (Rules), involving violations of environmental laws and regulations in
relation to the grounding of the US military ship USS Guardian over the Tubbataha Reefs.
Factual Background
The name "Tubbataha" came from the Samal (seafaring people of southern Philippines) language which
means "long reef exposed at low tide." Tubbataha is composed of two huge coral atolls - the north atoll and
the south atoll - and the Jessie Beazley Reef, a smaller coral structure about 20 kilometers north of the atolls.
The reefs of Tubbataha and Jessie Beazley are considered part of Cagayancillo, a remote island municipality of
Palawan.1
In 1988, Tubbataha was declared a National Marine Park by virtue of Proclamation No. 306 issued by President
Corazon C. Aquino on August 11, 1988. Located in the middle of Central Sulu Sea, 150 kilometers southeast of
Puerto Princesa City, Tubbataha lies at the heart of the Coral Triangle, the global center of marine biodiversity.
In 1993, Tubbataha was inscribed by the United Nations Educational Scientific and Cultural Organization
(UNESCO) as a World Heritage Site. It was recognized as one of the Philippines' oldest ecosystems, containing
excellent examples of pristine reefs and a high diversity of marine life. The 97,030-hectare protected marine
park is also an important habitat for internationally threatened and endangered marine species. UNESCO cited
Tubbataha's outstanding universal value as an important and significant natural habitat for in situ conservation
of biological diversity; an example representing significant on-going ecological and biological processes; and
an area of exceptional natural beauty and aesthetic importance.2
On April 6, 2010, Congress passed Republic Act (R.A.) No. 10067,3 otherwise known as the "Tubbataha Reefs
Natural Park (TRNP) Act of 2009" "to ensure the protection and conservation of the globally significant
economic, biological, sociocultural, educational and scientific values of the Tubbataha Reefs into perpetuity for
the enjoyment of present and future generations." Under the "no-take" policy, entry into the waters of TRNP is
strictly regulated and many human activities are prohibited and penalized or fined, including fishing, gathering,
destroying and disturbing the resources within the TRNP. The law likewise created the Tubbataha Protected
Area Management Board (TPAMB) which shall be the sole policy-making and permit-granting body of the
TRNP.
The USS Guardian is an Avenger-class mine countermeasures ship of the US Navy. In December 2012, the US
Embassy in the Philippines requested diplomatic clearance for the said vessel "to enter and exit the territorial
waters of the Philippines and to arrive at the port of Subic Bay for the purpose of routine ship replenishment,
maintenance, and crew liberty."4 On January 6, 2013, the ship left Sasebo, Japan for Subic Bay, arriving on
January 13, 2013 after a brief stop for fuel in Okinawa, Japan.1âwphi1
On January 15, 2013, the USS Guardian departed Subic Bay for its next port of call in Makassar, Indonesia. On
January 17, 2013 at 2:20 a.m. while transiting the Sulu Sea, the ship ran aground on the northwest side of
South Shoal of the Tubbataha Reefs, about 80 miles east-southeast of Palawan. No cine was injured in the
incident, and there have been no reports of leaking fuel or oil.
On January 20, 2013, U.S. 7th Fleet Commander, Vice Admiral Scott Swift, expressed regret for the incident in
a press statement.5 Likewise, US Ambassador to the Philippines Harry K. Thomas, Jr., in a meeting at the
Department of Foreign Affairs (DFA) on February 4, "reiterated his regrets over the grounding incident and
assured Foreign Affairs Secretazy Albert F. del Rosario that the United States will provide appropriate
compensation for damage to the reef caused by the ship."6 By March 30, 2013, the US Navy-led salvage team
had finished removing the last piece of the grounded ship from the coral reef.
On April 1 7, 2013, the above-named petitioners on their behalf and in representation of their respective
sector/organization and others, including minors or generations yet unborn, filed the present petition agairtst
Scott H. Swift in his capacity as Commander of the US 7th Fleet, Mark A. Rice in his capacity as Commanding
Officer of the USS Guardian and Lt. Gen. Terry G. Robling, US Marine Corps Forces, Pacific and Balikatan 2013
Exercises Co-Director ("US respondents"); President Benigno S. Aquino III in his capacity as Commander-in-
Chief of the Armed Forces of the Philippines (AFP), DF A Secretary Albert F. Del Rosario, Executive Secretary
Paquito Ochoa, Jr., Secretary Voltaire T. Gazmin (Department of National Defense), Secretary Jesus P. Paje
(Department of Environment and Natural Resources), Vice-Admiral Jose Luis M. Alano (Philippine Navy Flag
Officer in Command, AFP), Admiral Rodolfo D. Isorena (Philippine Coast Guard Commandant), Commodore
Enrico Efren Evangelista (Philippine Coast Guard-Palawan), and Major General Virgilio 0. Domingo (AFP
Commandant), collectively the "Philippine respondents."
The Petition
Petitioners claim that the grounding, salvaging and post-salvaging operations of the USS Guardian cause and
continue to cause environmental damage of such magnitude as to affect the provinces of Palawan, Antique,
Aklan, Guimaras, Iloilo, Negros Occidental, Negros Oriental, Zamboanga del Norte, Basilan, Sulu, and Tawi-
Tawi, which events violate their constitutional rights to a balanced and healthful ecology. They also seek a
directive from this Court for the institution of civil, administrative and criminal suits for acts committed in
violation of environmental laws and regulations in connection with the grounding incident.
Specifically, petitioners cite the following violations committed by US respondents under R.A. No. 10067:
unauthorized entry (Section 19); non-payment of conservation fees (Section 21 ); obstruction of law
enforcement officer (Section 30); damages to the reef (Section 20); and destroying and disturbing resources
(Section 26[g]). Furthermore, petitioners assail certain provisions of the Visiting Forces Agreement (VFA)
which they want this Court to nullify for being unconstitutional.
The numerous reliefs sought in this case are set forth in the final prayer of the petition, to wit: WHEREFORE,
in view of the foregoing, Petitioners respectfully pray that the Honorable Court: 1. Immediately issue upon the
filing of this petition a Temporary Environmental Protection Order (TEPO) and/or a Writ of Kalikasan, which
shall, in particular,
a. Order Respondents and any person acting on their behalf, to cease and desist all operations over the
Guardian grounding incident;
b. Initially demarcating the metes and bounds of the damaged area as well as an additional buffer zone;
c. Order Respondents to stop all port calls and war games under 'Balikatan' because of the absence of clear
guidelines, duties, and liability schemes for breaches of those duties, and require Respondents to assume
responsibility for prior and future environmental damage in general, and environmental damage under the
Visiting Forces Agreement in particular.
d. Temporarily define and describe allowable activities of ecotourism, diving, recreation, and limited
commercial activities by fisherfolk and indigenous communities near or around the TRNP but away from the
damaged site and an additional buffer zone;
2. After summary hearing, issue a Resolution extending the TEPO until further orders of the Court;
3. After due proceedings, render a Decision which shall include, without limitation:
a. Order Respondents Secretary of Foreign Affairs, following the dispositive portion of Nicolas v. Romulo, "to
forthwith negotiate with the United States representatives for the appropriate agreement on [environmental
guidelines and environmental accountability] under Philippine authorities as provided in Art. V[] of the VFA ... "
b. Direct Respondents and appropriate agencies to commence administrative, civil, and criminal proceedings
against erring officers and individuals to the full extent of the law, and to make such proceedings public;
c. Declare that Philippine authorities may exercise primary and exclusive criminal jurisdiction over erring U.S.
personnel under the circumstances of this case;
d. Require Respondents to pay just and reasonable compensation in the settlement of all meritorious claims
for damages caused to the Tubbataha Reef on terms and conditions no less severe than those applicable to
other States, and damages for personal injury or death, if such had been the case;
e. Direct Respondents to cooperate in providing for the attendance of witnesses and in the collection and
production of evidence, including seizure and delivery of objects connected with the offenses related to the
grounding of the Guardian;
f. Require the authorities of the Philippines and the United States to notify each other of the disposition of all
cases, wherever heard, related to the grounding of the Guardian;
g. Restrain Respondents from proceeding with any purported restoration, repair, salvage or post salvage plan
or plans, including cleanup plans covering the damaged area of the Tubbataha Reef absent a just settlement
approved by the Honorable Court;
h. Require Respondents to engage in stakeholder and LOU consultations in accordance with the Local
Government Code and R.A. 10067;
i. Require Respondent US officials and their representatives to place a deposit to the TRNP Trust Fund defined
under Section 17 of RA 10067 as a bona .fide gesture towards full reparations;
j. Direct Respondents to undertake measures to rehabilitate the areas affected by the grounding of the
Guardian in light of Respondents' experience in the Port Royale grounding in 2009, among other similar
grounding incidents;
k. Require Respondents to regularly publish on a quarterly basis and in the name of transparency and
accountability such environmental damage assessment, valuation, and valuation methods, in all stages of
negotiation;
l. Convene a multisectoral technical working group to provide scientific and technical support to the TPAMB;
m. Order the Department of Foreign Affairs, Department of National Defense, and the Department of
Environment and Natural Resources to review the Visiting Forces Agreement and the Mutual Defense Treaty to
consider whether their provisions allow for the exercise of erga omnes rights to a balanced and healthful
ecology and for damages which follow from any violation of those rights;
n. Narrowly tailor the provisions of the Visiting Forces Agreement for purposes of protecting the damaged
areas of TRNP;
o. Declare the grant of immunity found in Article V ("Criminal Jurisdiction") and Article VI of the Visiting Forces
Agreement unconstitutional for violating equal protection and/or for violating the preemptory norm of
nondiscrimination incorporated as part of the law of the land under Section 2, Article II, of the Philippine
Constitution;
p. Allow for continuing discovery measures;
q. Supervise marine wildlife rehabilitation in the Tubbataha Reefs in all other respects; and
4. Provide just and equitable environmental rehabilitation measures and such other reliefs as are just and
equitable under the premises.7 (Underscoring supplied.)
Since only the Philippine respondents filed their comment8 to the petition, petitioners also filed a motion for
early resolution and motion to proceed ex parte against the US respondents.9
Respondents' Consolidated Comment
In their consolidated comment with opposition to the application for a TEPO and ocular inspection and
production orders, respondents assert that: ( 1) the grounds relied upon for the issuance of a TEPO or writ of
Kalikasan have become fait accompli as the salvage operations on the USS Guardian were already completed;
(2) the petition is defective in form and substance; (3) the petition improperly raises issues involving the VFA
between the Republic of the Philippines and the United States of America; and ( 4) the determination of the
extent of responsibility of the US Government as regards the damage to the Tubbataha Reefs rests exdusively
with the executive branch.
The Court's Ruling
As a preliminary matter, there is no dispute on the legal standing of petitioners to file the present petition.
Locus standi is "a right of appearance in a court of justice on a given question."10 Specifically, it is "a party's
personal and substantial interest in a case where he has sustained or will sustain direct injury as a result" of
the act being challenged, and "calls for more than just a generalized grievance."11 However, the rule on
standing is a procedural matter which this Court has relaxed for non-traditional plaintiffs like ordinary citizens,
taxpayers and legislators when the public interest so requires, such as when the subject matter of the
controversy is of transcendental importance, of overreaching significance to society, or of paramount public
interest.12
In the landmark case of Oposa v. Factoran, Jr.,13 we recognized the "public right" of citizens to "a balanced
and healthful ecology which, for the first time in our constitutional history, is solemnly incorporated in the
fundamental law." We declared that the right to a balanced and healthful ecology need not be written in the
Constitution for it is assumed, like other civil and polittcal rights guaranteed in the Bill of Rights, to exist from
the inception of mankind and it is an issue of transcendental importance with intergenerational
implications.1âwphi1 Such right carries with it the correlative duty to refrain from impairing the
environment.14
On the novel element in the class suit filed by the petitioners minors in Oposa, this Court ruled that not only
do ordinary citizens have legal standing to sue for the enforcement of environmental rights, they can do so in
representation of their own and future generations. Thus:
Petitioners minors assert that they represent their generation as well as generations yet unborn. We find no
difficulty in ruling that they can, for themselves, for others of their generation and for the succeeding
generations, file a class suit. Their personality to sue in behalf of the succeeding generations can only be
based on the concept of intergenerational responsibility insofar as the right to a balanced and healthful
ecology is concerned. Such a right, as hereinafter expounded, considers the "rhythm and harmony of nature."
Nature means the created world in its entirety. Such rhythm and harmony indispensably include, inter alia, the
judicious disposition, utilization, management, renewal and conservation of the country's forest, mineral, land,
waters, fisheries, wildlife, off-shore areas and other natural resources to the end that their exploration,
development and utilization be equitably accessible to the present a:: well as future generations. Needless to
say, every generation has a responsibility to the next to preserve that rhythm and harmony for the full
1:njoyment of a balanced and healthful ecology. Put a little differently, the minors' assertion of their right to a
sound environment constitutes, at the same time, the performance of their obligation to ensure the protection
of that right for the generations to come.15 (Emphasis supplied.)
The liberalization of standing first enunciated in Oposa, insofar as it refers to minors and generations yet
unborn, is now enshrined in the Rules which allows the filing of a citizen suit in environmental cases. The
provision on citizen suits in the Rules "collapses the traditional rule on personal and direct interest, on the
principle that humans are stewards of nature."16
Having settled the issue of locus standi, we shall address the more fundamental question of whether this Court
has jurisdiction over the US respondents who did not submit any pleading or manifestation in this case.
The immunity of the State from suit, known also as the doctrine of sovereign immunity or non-suability of the
State,17 is expressly provided in Article XVI of the 1987 Constitution which states:
Section 3. The State may not be sued without its consent.
In United States of America v. Judge Guinto,18 we discussed the principle of state immunity from suit, as
follows:
The rule that a state may not be sued without its consent, now · expressed in Article XVI, Section 3, of the
1987 Constitution, is one of the generally accepted principles of international law that we have adopted as part
of the law of our land under Article II, Section 2. x x x.
Even without such affirmation, we would still be bound by the generally accepted principles of international
law under the doctrine of incorporation. Under this doctrine, as accepted by the majority of states, such
principles are deemed incorporated in the law of every civilized state as a condition and consequence of its
membership in the society of nations. Upon its admission to such society, the state is automatically obligated
to comply with these principles in its relations with other states.
As applied to the local state, the doctrine of state immunity is based on the justification given by Justice
Holmes that ''there can be no legal right against the authority which makes the law on which the right
depends." [Kawanakoa v. Polybank, 205 U.S. 349] There are other practical reasons for the enforcement of
the doctrine. In the case of the foreign state sought to be impleaded in the local jurisdiction, the added
inhibition is expressed in the maxim par in parem, non habet imperium. All states are sovereign equals and
cannot assert jurisdiction over one another. A contrary disposition would, in the language of a celebrated case,
"unduly vex the peace of nations." [De Haber v. Queen of Portugal, 17 Q. B. 171]
While the doctrine appears to prohibit only suits against the state without its consent, it is also applicable to
complaints filed against officials of the state for acts allegedly performed by them in the discharge of their
duties. The rule is that if the judgment against such officials will require the state itself to perform an
affirmative act to satisfy the same,. such as the appropriation of the amount needed to pay the damages
awarded against them, the suit must be regarded as against the state itself although it has not been formally
impleaded. [Garcia v. Chief of Staff, 16 SCRA 120] In such a situation, the state may move to dismiss the
comp.taint on the ground that it has been filed without its consent.19 (Emphasis supplied.)
Under the American Constitution, the doctrine is expressed in the Eleventh Amendment which reads:
The Judicial power of the United States shall not be construed to extend to any suit in law or equity,
commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or
Subjects of any Foreign State.
In the case of Minucher v. Court of Appeals,20 we further expounded on the immunity of foreign states from
the jurisdiction of local courts, as follows:
The precept that a State cannot be sued in the courts of a foreign state is a long-standing rule of customary
international law then closely identified with the personal immunity of a foreign sovereign from suit and, with
the emergence of democratic states, made to attach not just to the person of the head of state, or his
representative, but also distinctly to the state itself in its sovereign capacity. If the acts giving rise to a suit arc
those of a foreign government done by its foreign agent, although not necessarily a diplomatic personage, but
acting in his official capacity, the complaint could be barred by the immunity of the foreign sovereign from suit
without its consent. Suing a representative of a state is believed to be, in effect, suing the state itself. The
proscription is not accorded for the benefit of an individual but for the State, in whose service he is, under the
maxim -par in parem, non habet imperium -that all states are soverr~ign equals and cannot assert jurisdiction
over one another. The implication, in broad terms, is that if the judgment against an official would rec 1uire
the state itself to perform an affirmative act to satisfy the award, such as the appropriation of the amount
needed to pay the damages decreed against him, the suit must be regarded as being against the state itself,
although it has not been formally impleaded.21 (Emphasis supplied.)
In the same case we also mentioned that in the case of diplomatic immunity, the privilege is not an immunity
from the observance of the law of the territorial sovereign or from ensuing legal liability; it is, rather, an
immunity from the exercise of territorial jurisdiction.22
In United States of America v. Judge Guinto,23 one of the consolidated cases therein involved a Filipino
employed at Clark Air Base who was arrested following a buy-bust operation conducted by two officers of the
US Air Force, and was eventually dismissed from his employment when he was charged in court for violation
of R.A. No. 6425. In a complaint for damages filed by the said employee against the military officers, the latter
moved to dismiss the case on the ground that the suit was against the US Government which had not given its
consent. The RTC denied the motion but on a petition for certiorari and prohibition filed before this Court, we
reversed the RTC and dismissed the complaint. We held that petitioners US military officers were acting in the
exercise of their official functions when they conducted the buy-bust operation against the complainant and
thereafter testified against him at his trial. It follows that for discharging their duties as agents of the United
States, they cannot be directly impleaded for acts imputable to their principal, which has not given its consent
to be sued.
This traditional rule of State immunity which exempts a State from being sued in the courts of another State
without the former's consent or waiver has evolved into a restrictive doctrine which distinguishes sovereign
and governmental acts (Jure imperil") from private, commercial and proprietary acts (Jure gestionis). Under
the restrictive rule of State immunity, State immunity extends only to acts Jure imperii. The restrictive
application of State immunity is proper only when the proceedings arise out of commercial transactions of the
foreign sovereign, its commercial activities or economic affairs.24
In Shauf v. Court of Appeals,25 we discussed the limitations of the State immunity principle, thus:
It is a different matter where the public official is made to account in his capacity as such for acts contrary to
law and injurious to the rights of plaintiff. As was clearly set forth by JustiGe Zaldivar in Director of the Bureau
of Telecommunications, et al. vs. Aligaen, etc., et al. : "Inasmuch as the State authorizes only legal acts by its
officers, unauthorized acts of government officials or officers are not acts of the State, and an action against
the officials or officers by one whose rights have been invaded or violated by such acts, for the protection of
his rights, is not a suit against the State within the rule of immunity of the State from suit. In the same tenor,
it has been said that an action at law or suit in equity against a State officer or the director of a State
department on the ground that, while claiming to act for the State, he violates or invades the personal and
property rights of the plaintiff, under an unconstitutional act or under an assumption of authority which he
does not have, is not a suit against the State within the constitutional provision that the State may not be sued
without its consent." The rationale for this ruling is that the doctrine of state immunity cannot be used as an
instrument for perpetrating an injustice.

xxxx
The aforecited authorities are clear on the matter. They state that the doctrine of immunity from suit will not
apply and may not be invoked where the public official is being sued in his private and personal capacity as an
ordinary citizen. The cloak of protection afforded the officers and agents of the government is removed the
moment they are sued in their individual capacity. This situation usually arises where the public official acts
without authority or in excess of the powers vested in him. It is a well-settled principle of law that a public
official may be liable in his personal private capacity for whatever damage he may have caused by his act
done with malice and in bad faith, or beyond the scope of his authority or jurisdiction.26 (Emphasis supplied.)
In this case, the US respondents were sued in their official capacity as commanding officers of the US Navy
who had control and supervision over the USS Guardian and its crew. The alleged act or omission resulting in
the unfortunate grounding of the USS Guardian on the TRNP was committed while they we:re performing
official military duties. Considering that the satisfaction of a judgment against said officials will require
remedial actions and appropriation of funds by the US government, the suit is deemed to be one against the
US itself. The principle of State immunity therefore bars the exercise of jurisdiction by this Court over the
persons of respondents Swift, Rice and Robling.
During the deliberations, Senior Associate Justice Antonio T. Carpio took the position that the conduct of the
US in this case, when its warship entered a restricted area in violation of R.A. No. 10067 and caused damage
to the TRNP reef system, brings the matter within the ambit of Article 31 of the United Nations Convention on
the Law of the Sea (UNCLOS). He explained that while historically, warships enjoy sovereign immunity from
suit as extensions of their flag State, Art. 31 of the UNCLOS creates an exception to this rule in cases where
they fail to comply with the rules and regulations of the coastal State regarding passage through the latter's
internal waters and the territorial sea.
According to Justice Carpio, although the US to date has not ratified the UNCLOS, as a matter of long-standing
policy the US considers itself bound by customary international rules on the "traditional uses of the oceans" as
codified in UNCLOS, as can be gleaned from previous declarations by former Presidents Reagan and Clinton,
and the US judiciary in the case of United States v. Royal Caribbean Cruise Lines, Ltd.27
The international law of the sea is generally defined as "a body of treaty rules arid customary norms governing
the uses of the sea, the exploitation of its resources, and the exercise of jurisdiction over maritime regimes. It
is a branch of public international law, regulating the relations of states with respect to the uses of the
oceans."28 The UNCLOS is a multilateral treaty which was opened for signature on December 10, 1982 at
Montego Bay, Jamaica. It was ratified by the Philippines in 1984 but came into force on November 16, 1994
upon the submission of the 60th ratification.
The UNCLOS is a product of international negotiation that seeks to balance State sovereignty (mare clausum)
and the principle of freedom of the high seas (mare liberum).29 The freedom to use the world's marine waters
is one of the oldest customary principles of international law.30 The UNCLOS gives to the coastal State
sovereign rights in varying degrees over the different zones of the sea which are: 1) internal waters, 2)
territorial sea, 3) contiguous zone, 4) exclusive economic zone, and 5) the high seas. It also gives coastal
States more or less jurisdiction over foreign vessels depending on where the vessel is located.31
Insofar as the internal waters and territorial sea is concerned, the Coastal State exercises sovereignty, subject
to the UNCLOS and other rules of international law. Such sovereignty extends to the air space over the
territorial sea as well as to its bed and subsoil.32
In the case of warships,33 as pointed out by Justice Carpio, they continue to enjoy sovereign immunity subject
to the following exceptions:
Article 30
Non-compliance by warships with the laws and regulations of the coastal State
If any warship does not comply with the laws and regulations of the coastal State concerning passage through
the territorial sea and disregards any request for compliance therewith which is made to it, the coastal State
may require it to leave the territorial sea immediately.
Article 31
Responsibility of the flag State for damage caused by a warship
or other government ship operated for non-commercial purposes
The flag State shall bear international responsibility for any loss or damage to the coastal State resulting from
the non-compliance by a warship or other government ship operated for non-commercial purposes with the
laws and regulations of the coastal State concerning passage through the territorial sea or with the provisions
of this Convention or other rules of international law.
Article 32
Immunities of warships and other government ships operated for non-commercial purposes
With such exceptions as are contained in subsection A and in articles 30 and 31, nothing in this Convention
affects the immunities of warships and other government ships operated for non-commercial purposes.
(Emphasis supplied.) A foreign warship's unauthorized entry into our internal waters with resulting damage to
marine resources is one situation in which the above provisions may apply. But what if the offending warship
is a non-party to the UNCLOS, as in this case, the US?
An overwhelming majority - over 80% -- of nation states are now members of UNCLOS, but despite this the
US, the world's leading maritime power, has not ratified it.
While the Reagan administration was instrumental in UNCLOS' negotiation and drafting, the U.S. delegation
ultimately voted against and refrained from signing it due to concerns over deep seabed mining technology
transfer provisions contained in Part XI. In a remarkable, multilateral effort to induce U.S. membership, the
bulk of UNCLOS member states cooperated over the succeeding decade to revise the objection.able provisions.
The revisions satisfied the Clinton administration, which signed the revised Part XI implementing agreement in
1994. In the fall of 1994, President Clinton transmitted UNCLOS and the Part XI implementing agreement to
the Senate requesting its advice and consent. Despite consistent support from President Clinton, each of his
successors, and an ideologically diverse array of stakeholders, the Senate has since withheld the consent
required for the President to internationally bind the United States to UNCLOS.
While UNCLOS cleared the Senate Foreign Relations Committee (SFRC) during the 108th and 110th
Congresses, its progress continues to be hamstrung by significant pockets of political ambivalence over U.S.
participation in international institutions. Most recently, 111 th Congress SFRC Chairman Senator John Kerry
included "voting out" UNCLOS for full Senate consideration among his highest priorities. This did not occur,
and no Senate action has been taken on UNCLOS by the 112th Congress.34
Justice Carpio invited our attention to the policy statement given by President Reagan on March 10, 1983 that
the US will "recognize the rights of the other , states in the waters off their coasts, as reflected in the
convention [UNCLOS], so long as the rights and freedom of the United States and others under international
law are recognized by such coastal states", and President Clinton's reiteration of the US policy "to act in a
manner consistent with its [UNCLOS] provisions relating to traditional uses of the oceans and to encourage
other countries to do likewise." Since Article 31 relates to the "traditional uses of the oceans," and "if under its
policy, the US 'recognize[s] the rights of the other states in the waters off their coasts,"' Justice Carpio
postulates that "there is more reason to expect it to recognize the rights of other states in their internal
waters, such as the Sulu Sea in this case."
As to the non-ratification by the US, Justice Carpio emphasizes that "the US' refusal to join the UN CLOS was
centered on its disagreement with UN CLOS' regime of deep seabed mining (Part XI) which considers the
oceans and deep seabed commonly owned by mankind," pointing out that such "has nothing to do with its
[the US'] acceptance of customary international rules on navigation."
It may be mentioned that even the US Navy Judge Advocate General's Corps publicly endorses the ratification
of the UNCLOS, as shown by the following statement posted on its official website:
The Convention is in the national interest of the United States because it establishes stable maritime zones,
including a maximum outer limit for territorial seas; codifies innocent passage, transit passage, and
archipelagic sea lanes passage rights; works against "jurisdictiomtl creep" by preventing coastal nations from
expanding their own maritime zones; and reaffirms sovereign immunity of warships, auxiliaries anJ
government aircraft.
xxxx
Economically, accession to the Convention would support our national interests by enhancing the ability of the
US to assert its sovereign rights over the resources of one of the largest continental shelves in the world.
Further, it is the Law of the Sea Convention that first established the concept of a maritime Exclusive Economic
Zone out to 200 nautical miles, and recognized the rights of coastal states to conserve and manage the natural
resources in this Zone.35
We fully concur with Justice Carpio's view that non-membership in the UNCLOS does not mean that the US will
disregard the rights of the Philippines as a Coastal State over its internal waters and territorial sea. We thus
expect the US to bear "international responsibility" under Art. 31 in connection with the USS Guardian
grounding which adversely affected the Tubbataha reefs. Indeed, it is difficult to imagine that our long-time
ally and trading partner, which has been actively supporting the country's efforts to preserve our vital marine
resources, would shirk from its obligation to compensate the damage caused by its warship while transiting
our internal waters. Much less can we comprehend a Government exercising leadership in international affairs,
unwilling to comply with the UNCLOS directive for all nations to cooperate in the global task to protect and
preserve the marine environment as provided in Article 197, viz:
Article 197
Cooperation on a global or regional basis
States shall cooperate on a global basis and, as appropriate, on a regional basis, directly or through competent
international organizations, in formulating and elaborating international rules, standards and recommended
practices and procedures consistent with this Convention, for the protection and preservation of the marine
environment, taking into account characteristic regional features.
In fine, the relevance of UNCLOS provisions to the present controversy is beyond dispute. Although the said
treaty upholds the immunity of warships from the jurisdiction of Coastal States while navigating the.latter's
territorial sea, the flag States shall be required to leave the territorial '::;ea immediately if they flout the laws
and regulations of the Coastal State, and they will be liable for damages caused by their warships or any other
government vessel operated for non-commercial purposes under Article 31.
Petitioners argue that there is a waiver of immunity from suit found in the VFA. Likewise, they invoke federal
statutes in the US under which agencies of the US have statutorily waived their immunity to any action. Even
under the common law tort claims, petitioners asseverate that the US respondents are liable for negligence,
trespass and nuisance.
We are not persuaded.
The VFA is an agreement which defines the treatment of United States troops and personnel visiting the
Philippines to promote "common security interests" between the US and the Philippines in the region. It
provides for the guidelines to govern such visits of military personnel, and further defines the rights of the
United States and the Philippine government in the matter of criminal jurisdiction, movement of vessel and
aircraft, importation and exportation of equipment, materials and supplies.36 The invocation of US federal tort
laws and even common law is thus improper considering that it is the VF A which governs disputes involving
US military ships and crew navigating Philippine waters in pursuance of the objectives of the agreement.
As it is, the waiver of State immunity under the VF A pertains only to criminal jurisdiction and not to special
civil actions such as the present petition for issuance of a writ of Kalikasan. In fact, it can be inferred from
Section 17, Rule 7 of the Rules that a criminal case against a person charged with a violation of an
environmental law is to be filed separately:
SEC. 17. Institution of separate actions.-The filing of a petition for the issuance of the writ of kalikasan shall
not preclude the filing of separate civil, criminal or administrative actions.
In any case, it is our considered view that a ruling on the application or non-application of criminal jurisdiction
provisions of the VF A to US personnel who may be found responsible for the grounding of the USS Guardian,
would be premature and beyond the province of a petition for a writ of Kalikasan. We also find it unnecessary
at this point to determine whether such waiver of State immunity is indeed absolute. In the same vein, we
cannot grant damages which have resulted from the violation of environmental laws. The Rules allows the
recovery of damages, including the collection of administrative fines under R.A. No. 10067, in a separate civil
suit or that deemed instituted with the criminal action charging the same violation of an environmental law.37
Section 15, Rule 7 enumerates the reliefs which may be granted in a petition for issuance of a writ of
Kalikasan, to wit:
SEC. 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:
(a) Directing respondent to permanently cease and desist from committing acts or neglecting the performance
of a duty in violation of environmental laws resulting in environmental destruction or damage;
(b) Directing the respondent public official, govemment agency, private person or entity to protect, preserve,
rehabilitate or restore the environment;
(c) Directing the respondent public official, government agency, private person or entity to monitor strict
compliance with the decision and orders of the court;
(d) Directing the respondent public official, government agency, or private person or entity to make periodic
reports on the execution of the final judgment; and
(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. (Emphasis supplied.)
We agree with respondents (Philippine officials) in asserting that this petition has become moot in the sense
that the salvage operation sought to be enjoined or restrained had already been accomplished when
petitioners sought recourse from this Court. But insofar as the directives to Philippine respondents to protect
and rehabilitate the coral reef stn icture and marine habitat adversely affected by the grounding incident are
concerned, petitioners are entitled to these reliefs notwithstanding the completion of the removal of the USS
Guardian from the coral reef. However, we are mindful of the fact that the US and Philippine governments
both expressed readiness to negotiate and discuss the matter of compensation for the damage caused by the
USS Guardian. The US Embassy has also declared it is closely coordinating with local scientists and experts in
assessing the extent of the damage and appropriate methods of rehabilitation.
Exploring avenues for settlement of environmental cases is not proscribed by the Rules. As can be gleaned
from the following provisions, mediation and settlement are available for the consideration of the parties, and
which dispute resolution methods are encouraged by the court, to wit:
RULE3
xxxx
SEC. 3. Referral to mediation.-At the start of the pre-trial conference, the court shall inquire from the parties if
they have settled the dispute; otherwise, the court shall immediately refer the parties or their counsel, if
authorized by their clients, to the Philippine Mediation Center (PMC) unit for purposes of mediation. If not
available, the court shall refer the case to the clerk of court or legal researcher for mediation.
Mediation must be conducted within a non-extendible period of thirty (30) days from receipt of notice of
referral to mediation.
The mediation report must be submitted within ten (10) days from the expiration of the 30-day period.
SEC. 4. Preliminary conference.-If mediation fails, the court will schedule the continuance of the pre-trial.
Before the scheduled date of continuance, the court may refer the case to the branch clerk of court for a
preliminary conference for the following purposes:
(a) To assist the parties in reaching a settlement;
xxxx
SEC. 5. Pre-trial conference; consent decree.-The judge shall put the parties and their counsels under oath,
and they shall remain under oath in all pre-trial conferences.
The judge shall exert best efforts to persuade the parties to arrive at a settlement of the dispute. The judge
may issue a consent decree approving the agreement between the parties in accordance with law, morals,
public order and public policy to protect the right of the people to a balanced and healthful ecology.
xxxx
SEC. 10. Efforts to settle.- The court shall endeavor to make the parties to agree to compromise or settle in
accordance with law at any stage of the proceedings before rendition of judgment. (Underscoring supplied.)
The Court takes judicial notice of a similar incident in 2009 when a guided-missile cruiser, the USS Port Royal,
ran aground about half a mile off the Honolulu Airport Reef Runway and remained stuck for four days. After
spending $6.5 million restoring the coral reef, the US government was reported to have paid the State of
Hawaii $8.5 million in settlement over coral reef damage caused by the grounding.38
To underscore that the US government is prepared to pay appropriate compensation for the damage caused
by the USS Guardian grounding, the US Embassy in the Philippines has announced the formation of a US
interdisciplinary scientific team which will "initiate discussions with the Government of the Philippines to review
coral reef rehabilitation options in Tubbataha, based on assessments by Philippine-based marine scientists."
The US team intends to "help assess damage and remediation options, in coordination with the Tubbataha
Management Office, appropriate Philippine government entities, non-governmental organizations, and
scientific experts from Philippine universities."39
A rehabilitation or restoration program to be implemented at the cost of the violator is also a major relief that
may be obtained under a judgment rendered in a citizens' suit under the Rules, viz:
RULES
SECTION 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.1âwphi1
In the light of the foregoing, the Court defers to the Executive Branch on the matter of compensation and
rehabilitation measures through diplomatic channels. Resolution of these issues impinges on our relations with
another State in the context of common security interests under the VFA. It is settled that "[t]he conduct of
the foreign relations of our government is committed by the Constitution to the executive and legislative-"the
political" --departments of the government, and the propriety of what may be done in the exercise of this
political power is not subject to judicial inquiry or decision."40
On the other hand, we cannot grant the additional reliefs prayed for in the petition to order a review of the
VFA and to nullify certain immunity provisions thereof.
As held in BAYAN (Bagong Alyansang Makabayan) v. Exec. Sec. Zamora,41 the VFA was duly concurred in by
the Philippine Senate and has been recognized as a treaty by the United States as attested and certified by the
duly authorized representative of the United States government. The VF A being a valid and binding
agreement, the parties are required as a matter of international law to abide by its terms and provisions.42
The present petition under the Rules is not the proper remedy to assail the constitutionality of its provisions.
WHEREFORE, the petition for the issuance of the privilege of the Writ of Kalikasan is hereby DENIED.
No pronouncement as to costs.
SO ORDERED.

15. ISAAT VS GREENPEACE ASIA

G.R. No. 209271, July 26, 2016 - INTERNATIONAL SERVICE FOR THE ACQUISITION OF AGRI-BIOTECH
APPLICATIONS, INC., Petitioner, v. GREENPEACE SOUTHEAST ASIA (PHILIPPINES), MAGSASAKA AT
SIYENTIPIKO SA PAGPAPAUNLAD NG AGRIKULTURA (MASIPAG), REP. TEODORO CASINO, DR. BEN
MALAYANG III, DR. ANGELINA GALANG, LEONARDO AVILA III, CATHERINE UNTALAN, ATTY, MARIA PAZ
LUNA, JUANITO MODINA, DAGOHOY MAGAWAY, DR. ROMEO QUIJANO, DR. WENCESLAO KIAT, JR., ATTY. H.
HARRY ROQUE, JR., FORMER SEN. ORLANDO MERCADO, NOEL CABANGON, MAYOR EDWARD S. HAGEDORN,
AND EDWIN MARTHINE LOPEZ, RESPONDENTS. CROP LIFE PHILIPPINES, INC., Petitioner-In-Intervention.;
G.R. NO. 209276 - ENVIRONMENTAL MANAGEMENT BUREAU OF THE DEPARTMENT OF ENVIRONMENT AND
NATURAL RESOURCES, BUREAU OF PLANT INDUSTRY AND THE FERTILIZER AND PESTICIDE AUTHORITY OF
THE DEPARTMENT OF AGRICULTURE, Petitioners, v. COURT OF APPEALS, GREENPEACE SOUTHEAST ASIA
(PHILIPPINES), MAGSASAKA AT SIYENTIPIKO SA PAGPAPAUNLAD NG AGRIKULTURA (MASIPAG), REP.
TEODORO CASINO, DR. BEN MALAYANG III, DR, ANGELINA GALANG, LEONARDO AVILA HI, CATHERINE
UNTALAN, ATTY. MARIA PAZ LUNA, JUANITO MODINA, DAGOHOY MAGAWAY, DR. ROMEO QUIJANO, DR.
WENCESLAO KIAT, JR., ATTY. H. HARRY ROQUE, JR., FORMER SEN. ORLANDO MERCADO, NOEL CABANGON,
MAYOR EDWARD S. HAGEDORN, AND EDWIN MARTHINE LOPEZ, RESPONDENTS. CROP LIFE PHILIPPINES,
INC., Petitioner-In-Intervention.; G.R. NO. 209301 - UNIVERSITY OF THE PHILIPPINES LOS BAÑOS
FOUNDATION, INC.,. Petitioner, v. GREENPEACE SOUTHEAST ASIA (PHILIPPINES) MAGSASAKA AT
SIYENTIPIKO SA PAGPAPAUNLAD NG AGRIKULTURA (MASIPAG), REP. TEODORO CASINO, DR. BEN
MALAYANG III, DR. ANGELINA GALANG, LEONARDO AVILA III, CATHERINE UNTALAN, ATTY. MARIA PAZ
LUNA, JUANITO MODINA, DAGOHOY MAGAWAY, DR. ROMEO QUIJANO, DR. WENCESLAO KIAT, JR., ATTY. H.
HARRY L. ROQUE, JR., FORMER SEN. ORLANDO MERCADO, NOEL CABANGON, MAYOR EDWARD S.
HAGEDORN, AND EDWIN MARTHINE LOPEZ, Respondents.; G.R. NO. 209430 - UNIVERSITY OF THE
PHILIPPINES LOS BAÑOS, Petitioner, v. GREENPEACE SOUTHEAST ASIA (PHILIPPINES), MAGSASAKA AT
SIYENTIPIKO SA PAGPAPAUNLAD NG AGRIKULTURA (MASIPAG), REP. TEODORO CASINO, DR. BEN
MALAYANG III, DR. ANGELINA GALANG, LEONARDO AVILA III, CATHERINE UNTALAN, ATTY. MARIA PAZ
LUNA, JUANITO MODINA, DAGOROY MAGAWAY, DR. ROMEO QUIJANO, DR. WENCESLAO KIAT, JR., ATTY. H.
HARRY L. ROQUE, JR., FORMER SEN. ORLANDO MERCADO, NOEL CABANGON, MAYOR EDWARD S.
HAGEDORN, AND PROMULGATED: EDWIN MARTHINE LOPEZ, Respondent.

EN BANC
G.R. No. 209271, July 26, 2016
INTERNATIONAL SERVICE FOR THE ACQUISITION OF AGRI-BIOTECH APPLICATIONS, INC., Petitioner, v.
GREENPEACE SOUTHEAST ASIA (PHILIPPINES), MAGSASAKA AT SIYENTIPIKO SA PAGPAPAUNLAD NG
AGRIKULTURA (MASIPAG), REP. TEODORO CASINO, DR. BEN MALAYANG III, DR. ANGELINA GALANG,
LEONARDO AVILA III, CATHERINE UNTALAN, ATTY, MARIA PAZ LUNA, JUANITO MODINA, DAGOHOY
MAGAWAY, DR. ROMEO QUIJANO, DR. WENCESLAO KIAT, JR., ATTY. H. HARRY ROQUE, JR., FORMER SEN.
ORLANDO MERCADO, NOEL CABANGON, MAYOR EDWARD S. HAGEDORN, AND EDWIN MARTHINE LOPEZ,
RESPONDENTS. CROP LIFE PHILIPPINES, INC., Petitioner-In-Intervention.

G.R. NO. 209276

ENVIRONMENTAL MANAGEMENT BUREAU OF THE DEPARTMENT OF ENVIRONMENT AND NATURAL

RESOURCES, BUREAU OF PLANT INDUSTRY AND THE FERTILIZER AND PESTICIDE AUTHORITY OF THE
DEPARTMENT OF AGRICULTURE, Petitioners, v. COURT OF APPEALS, GREENPEACE SOUTHEAST ASIA
(PHILIPPINES), MAGSASAKA AT SIYENTIPIKO SA PAGPAPAUNLAD NG AGRIKULTURA (MASIPAG), REP.
TEODORO CASINO, DR. BEN MALAYANG III, DR, ANGELINA GALANG, LEONARDO AVILA HI, CATHERINE
UNTALAN, ATTY. MARIA PAZ LUNA, JUANITO MODINA, DAGOHOY MAGAWAY, DR. ROMEO QUIJANO, DR.
WENCESLAO KIAT, JR., ATTY. H. HARRY ROQUE, JR., FORMER SEN. ORLANDO MERCADO, NOEL CABANGON,
MAYOR EDWARD S. HAGEDORN, AND EDWIN MARTHINE LOPEZ, RESPONDENTS. CROP LIFE PHILIPPINES,
INC., Petitioner-In-Intervention.

G.R. NO. 209301

UNIVERSITY OF THE PHILIPPINES LOS BAÑOS FOUNDATION, INC.,. Petitioner, v. GREENPEACE SOUTHEAST
ASIA (PHILIPPINES) MAGSASAKA AT SIYENTIPIKO SA PAGPAPAUNLAD NG AGRIKULTURA (MASIPAG), REP.
TEODORO CASINO, DR. BEN MALAYANG III, DR. ANGELINA GALANG, LEONARDO AVILA III, CATHERINE
UNTALAN, ATTY. MARIA PAZ LUNA, JUANITO MODINA, DAGOHOY MAGAWAY, DR. ROMEO QUIJANO, DR.
WENCESLAO KIAT, JR., ATTY. H. HARRY L. ROQUE, JR., FORMER SEN. ORLANDO MERCADO, NOEL
CABANGON, MAYOR EDWARD S. HAGEDORN, AND EDWIN MARTHINE LOPEZ, Respondents.

G.R. NO. 209430

UNIVERSITY OF THE PHILIPPINES LOS BAÑOS, Petitioner, v. GREENPEACE SOUTHEAST ASIA (PHILIPPINES),
MAGSASAKA AT SIYENTIPIKO SA PAGPAPAUNLAD NG AGRIKULTURA (MASIPAG), REP. TEODORO CASINO,
DR. BEN MALAYANG III, DR. ANGELINA GALANG, LEONARDO AVILA III, CATHERINE UNTALAN, ATTY. MARIA
PAZ LUNA, JUANITO MODINA, DAGOROY MAGAWAY, DR. ROMEO QUIJANO, DR. WENCESLAO KIAT, JR.,
ATTY. H. HARRY L. ROQUE, JR., FORMER SEN. ORLANDO MERCADO, NOEL CABANGON, MAYOR EDWARD S.
HAGEDORN, AND PROMULGATED: EDWIN MARTHINE LOPEZ, Respondent.
RESOLUTION
PERLAS-BERNABE, J.:
Before the Court are nine (9) Motions for Reconsideration1 assailing the Decision2 dated December 8, 2015 of
the Court (December 8, 2015 Decision), which upheld with modification the Decision3 dated May 17, 2013 and
the Resolution4 dated September 20, 2013 of the Court of Appeals (CA) in CA-G.R. SP No. 00013.

The Facts

The instant case arose from the conduct of field trials for "bioengineered eggplants," known as Bacillus
thuringiensis (Bt) eggplant (Bt talong), administered pursuant to the Memorandum of Undertaking5 (MOU)
entered into by herein petitioners University of the Philippines Los Banos Foundation, Inc. (UPLBFI) and
International Service for the Acquisition of Agri-Biotech Applications, Inc. (ISAAA), and the University of the
Philippines Mindanao Foundation, Inc. (UPMFI), among others. Bt talong contains the crystal toxin genes from
the soil bacterium Bt, which produces the Cry1Ac protein that is toxic to target insect pests. The Cry1Ac
protein is said to be highly specific to lepidopteran larvae such as the fruit and shoot borer, the most
destructive insect pest to eggplants.6chanrobleslaw

From 2007 to 2009, petitioner University of the Philippines Los Baiios (UPLB), the implementing institution of
the field trials, conducted a contained experiment on Bt talong under the supervision of the National
Committee on Biosafety of the Philippines (NCBP).7 The NCBP, created under Executive Order No. (EO) 430,8
is the regulatory body tasked to: (a) "identify and evaluate potential hazards involved in initiating genetic
engineering experiments or the introduction of new species and genetically engineered organisms and
recommend measures to minimize risks"; and (b) "formulate and review national policies and guidelines on
biosafety, such as the safe conduct of work on genetic engineering, pests and their genetic materials for the
protection of public health, environment[,] and personnel^] and supervise the implementation thereof."9 Upon
the completion of the contained experiment, the NCBP issued a Certificate10 therefor stating that all biosafety
measures were complied with, and no untoward incident had occurred.11chanrobleslaw

On March 16, 2010 and June 28, 2010, the Bureau of Plant Industries (BPI) issued two (2)-year Biosafety
Permits12 for field testing of Bt talong13 after UPLB's field test proposal satisfactorily completed biosafety risk
assessment for field testing pursuant to the Department of Agriculture's (DA) Administrative Order No. 8,
series of 200214 (DAO 08-2002),15 which provides for the rules and regulations for the importation and
release into the environment of plants and plant products derived from the use of modern biotechnology.16
Consequently, field testing proceeded in approved trial sites in North Cotabato, Pangasinan, Camarines Sur,
Davao City, and Laguna.17chanrobleslaw

On April 26, 2012, respondents Greenpeace Southeast Asia (Philippines) (Greenpeace), Magsasaka at
Siyentipiko sa Pagpapaunlad ng Agrikultura (MASIPAG), and others (respondents) filed before the Court a
Petition for Writ of Continuing Mandamus and Writ of Kalikasan with Prayer for the Issuance of a Temporary
Environmental Protection Order (TEPO)18 (petition for Writ of Kalikasan) against herein petitioners the
Environmental Management Bureau (EMB) of the Department of Environment and Natural Resources (DENR),
the BPI and the Fertilizer and Pesticide Authority (FPA) of the DA, UPLBFI, and ISAAA, and UPMFI, alleging
that the Bt talong field trials violated their constitutional right to health and a balanced ecology considering,
among others, that: (a) the Environmental Compliance Certificate (ECC), as required by Presidential Decree
No. (PD) 1151,19 was not secured prior to the field trials;20 (b) the required public consultations under the
Local Government Code (LGC) were not complied with;21 and (c) as a regulated article under DAO 08-2002,
Bt talong is presumed harmful to human health and the environment, and that there is no independent, peer-
reviewed study showing its safety for human consumption and the environment.22 Further, they contended
that since the scientific evidence as to the safety of Bt talong remained insufficient or uncertain, and that
preliminary scientific evaluation shows reasonable grounds for concern, the precautionary principle should be
applied and, thereby, the field trials be enjoined.23chanrobleslaw
On May 2, 2012, the Court issued24 a Writ of Kalikasan against petitioners (except UPLB25cralawred) and
UPMFI, ordering them to make a verified return within a non-extendible period often (10) days, as provided
for in Section 8, Rule 7 of the Rules of Procedure for Environmental Cases.26 Thus, in compliance therewith,
ISAAA, EMB/BPI/FPA, UPLBFI, and UPMFI27 filed their respective verified returns,28 and therein maintained
that: (a) all environmental laws were complied with, including the required public consultations in the affected
communities; (b) an ECC was not required for the field trials as it will not significantly affect the environment
nor pose a hazard to human health; (c) there is a plethora of scientific works and literature, peer-reviewed, on
the safety of Bt talong for human consumption; (d) at any rate, the safety of Bt talong for human consumption
is irrelevant because none of the eggplants will be consumed by humans or animals and all materials not used
for analyses will be chopped, boiled, and buried following the conditions of the Biosafety Permits; and (e) the
precautionary principle could not be applied as the field testing was only a part of a continuing study to ensure
that such trials have no significant and negative impact on the environment.29chanrobleslaw

On July 10, 2012, the Court issued a Resolution30 referring the case to the Court of Appeals for acceptance of
the return of the writ and for hearing, reception of evidence, and rendition of judgment.31 In a hearing before
the CA on August 14, 2012, UPLB was impleaded as a party to the case and was furnished by respondents a
copy of their petition. Consequently the CA directed UPLB to file its comment to the petition32 and, on August
24, 2012, UPLB filed its Answer33 adopting the arguments and allegations in the verified return filed by
UPLBFI. On the other hand, in a Resolution34 dated February 13, 2013, the CA discharged UPMFI as a party to
the case pursuant to the Manifestation and Motion filed by respondents in order to expedite the proceedings
and resolution of the latter's petition.

The CA Ruling

In a Decision35 dated May 17, 2013, the CA ruled in favor of respondents and directed petitioners to
permanently cease and desist from conducting the Bt talong field trials.36 At the outset, it did not find merit in
petitioners' contention that the case should be dismissed on the ground of mootness, noting that the issues
raised by the latter were "capable of repetition yet evading review" since the Bt talong field trial was just one
of the phases or stages of an overall and bigger study that is being conducted in relation to the said
genetically-modified organism37 It then held that the precautionary principle set forth under Section I,38 Rule
20 of the Rules of Procedure for Environmental Cases39 is relevant, considering the Philippines' rich
biodiversity and uncertainty surrounding the safety of Bt talong. It noted the possible irreversible effects of the
field trials and the introduction of Bt talong to the market, and found the existing regulations issued by the DA
and the Department of Science and Technology (DOST) insufficient to guarantee the safety of the
environment and the health of the people.40chanrobleslaw

Aggrieved, petitioners separately moved for reconsideration.41 However, in a Resolution42 dated September
20, 2013, the CA denied the same and remarked that introducing genetically modified plant into the ecosystem
is an ecologically imbalancing act.43 Anent UPLB's argument that the Writ of Kalikasan violated its right to
academic freedom, the CA emphasized that the writ did not stop the research on Bt talong but only the
procedure employed in conducting the field trials, and only at this time when there is yet no law ensuring its
safety when introduced to the environment.44chanrobleslaw

Dissatisfied, petitioners filed their respective petitions for review on certiorari before this Court.

The Proceedings Before the Court

In a Decision45 dated December 8, 2015, the Court denied the petitions and accordingly, affirmed with
modification the ruling of the CA.46 Agreeing with the CA, the Court held that the precautionary principle
applies in this case since the risk of harm from the field trials of Bt talong remains uncertain and there exists a
possibility of serious and irreversible harm. The Court observed that eggplants are a staple vegetable in the
country that is mostly grown by small-scale farmers who are poor and marginalized; thus, given the country's
rich biodiversity, the consequences of contamination and genetic pollution would be disastrous and
irreversible.47chanrobleslaw
The Court likewise agreed with the CA in not dismissing the case for being moot and academic despite the
completion and tennination of the Bt talong field trials, on account of the following exceptions to the mootness
principle: (a) the exceptional character of the situation and the paramount public interest is involved; and (b)
the case is capable of repetition yet evading review.48chanrobleslaw

Further, the Court noted that while the provisions of DAO 08-2002 were observed, the National Biosafety
Framework (NBF) established under EO 514, series of 200649 which requires public participation in all stages-
of biosafety decision-making, pursuant to the Cartagena Protocol on Biosafety50 which was acceded to by the
Philippines in 2000 and became effective locally in 2003, was not complied with.51 Moreover, the field testing
should have been subjected to Environmental Impact Assessment (EIA), considering that it involved new
technologies with uncertain results.52chanrobleslaw

Thus, the Court permanently enjoined the field testing of Bt talong. In addition, it declared DAO 08-2002 null
and void for failure to consider the provisions of the NBF. The Court also temporarily enjoined any application
for contained use, field testing, propagation, commercialization, and importation of genetically modified
organisms until a new administrative order is promulgated in accordance with law.53chanrobleslaw

The Issues Presented in the Motions for Reconsideration

Undaunted, petitioners moved for reconsideration,54 arguing, among others, that: (a) the case should have
been dismissed for mootness in view of the completion and termination of the Bt talong field trials and the
expiration of the Biosafety Permits;55 (b) the Court should not have ruled on the validity of DAO 08-2002 as it
was not raised as an issue;56 and (c) the Court erred in relying on the studies cited in the December 8, 2015
Decision which were not offered in evidence and involved Bt corn, not Bt talong.57chanrobleslaw

In their Consolidated Comments,58 respondents maintain, in essence, that: (a) the case is not mooted by the
completion of the field trials since field testing is part of the process of commercialization and will eventually
lead to propagation, commercialization, and consumption of Bt talong as a consumer product;59 (b) the
validity of DAO 08-2002 was raised by respondents when they argued in their petition for Writ of Kalikasan
that such administrative issuance is not enough to adequately protect the Constitutional right of the people to
a balanced and healthful ecology;60 and (c) the Court correctly took judicial notice of the scientific studies
showing the negative effects of Bt technology and applied the precautionaiy principle.61chanrobleslaw

The Court's Ruling

The Court grants the motions for reconsideration on the ground of mootness.

As a rule, the Court may only adjudicate actual, ongoing controversies.62 The requirement of the existence of
a "case" or an "actual controversy" for the proper exercise of the power of judicial review proceeds from
Section 1, Article VIII of the 1987 Constitution:ChanRoblesVirtualawlibrary
Section 1. The judicial power shall be vested in one Supreme Court and in such lower courts as may be
established by law.

Judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are
legally demandable and enforceable, and to determine whether or not there has been a grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the
Government. (Emphasis supplied)
Accordingly, the Court is not empowered to decide moot questions or abstract propositions, or to declare
principles or rules of law which cannot affect the result as to the thing in issue in the case before it. In other
words, when a case is moot, it becomes non-justiciable.63chanrobleslaw

An action is considered "moot" when it no longer presents a justiciable controversy because the issues
involved have become academic or dead or when the matter in dispute has already been resolved and hence,
one is not entitled to judicial intervention unless the issue is likely to be raised again between the parties.
There is nothing for the court to resolve as the determination thereof has been overtaken by subsequent
events.64chanrobleslaw

Nevertheless, case law states that the Court will decide cases, otherwise moot, if: first, there is a grave
violation of the Constitution; second, the exceptional character of the situation and the paramount public
interest are involved; third, when the constitutional issue raised requires formulation of controlling principles to
guide the bench, the bar, and the public; and fourth, the case is capable of repetition yet evading review.65
Thus, jurisprudence recognizes these four instances as exceptions to the mootness principle.

In the December 8, 2015 Decision of the Court, it was held that (a) the present case is of exceptional
character and paramount public interest is involved, and (b) it is likewise capable of repetition yet evading
review. Hence, it was excepted from the mootness principle.66 However, upon a closer scrutiny of the parties'
arguments, the Court reconsiders its ruling and now finds merit in petitioners' assertion that the case should
have been dismissed for being moot and academic, and that the aforesaid exceptions to the said rule should
not have been applied.

I. On the paramount public interest exception.

Jurisprudence in this jurisdiction has set no hard-and-fast rule in determining whether a case involves
paramount public interest in relation to the mootness principle. However, a survey of cases would show that,
as a common guidepost for application, there should be some perceivable benefit to the public which demands
the Court to proceed with the resolution of otherwise moot questions.

In Gonzales v. Commission on Elections,67 an action for declaratory judgment assailing the validity of Republic
Act No. (RA) 4880,68 which prohibits the early nomination of candidates for elective offices and early election
campaigns or partisan political activities became moot by reason of the holding of the 1967 elections before
the case could be decided. Nonetheless, the Court treated the petition as one for prohibition and rendered
judgment in view of the paramount public interest and the undeniable necessity for a ruling, the national
elections [of 1969] being barely six months away."69chanrobleslaw

In De Castro v. Commission on Elections,70 the Court proceeded to resolve the election protest subject of that
case notwithstanding the supervening death of one of the contestants. According to the Court, in an election
contest, there is a paramount need to dispel the uncertainty that beclouds the real choice of the
electorate.71chanrobleslaw

In David v. Macapagal-Arroyo,72 the Court ruled on the constitutionality of Presidential Proclamation No. 1017,
s. 2006,73 which declared a state of National Emergency, even though the same was lifted before a decision
could be rendered. The Court explained that the case was one of exceptional character and involved
paramount public interest, because the people's basic rights to expression, assembly, and of the press were at
issue.74chanrobleslaw

In Constantino v. Sandiganbayan75 both of the accused were found guilty of graft and corrupt practices under
Section 3 (e) of RA 3019.76 One of the accused appealed the conviction, while the other filed a petition for
certiorari before the Court. While the appellant died during the pendency of his appeal, the Court still ruled on
the merits thereof considering the exceptional character of the appeals in relation to each other, i.e., the two
petitions were so intertwined that the absolution of the deceased was determinative of the absolution of the
other accused.77chanrobleslaw

More recently, in Funa v. Manila Economic and Cultural Office (MECO),78 the petitioner prayed that the
Commission on Audit (COA) be ordered to audit the MECO which is based in Taiwan, on the premise that it is
a government-owned and controlled corporation.79 The COA argued that the case is already moot and should
be dismissed, since it had already directed a team of auditors to proceed to Taiwan to audit the accounts of
MECO.80 Ruling on the merits, the Court explained that the case was of paramount public interest because it
involved the COA's performance of its constitutional duty and because the case concerns the legal status of
MECO, i.e., whether it may be considered as a government agency or not, which has a direct bearing on the
country's commitment to the One China Policy of the People's Republic of China.81chanrobleslaw

In contrast to the foregoing cases, no perceivable benefit to the public - whether rational or practical - may be
gained by resolving respondents' petition for Writ of Kalikasan on the merits.

To recount, these cases, which stemmed from herein respondents petition for Writ of Kalikasan, were mooted
by the undisputed expiration of the Biosafety Permits issued by the BPI and the completion and tennination of
the Bt talong field trials subject of the same.82 These incidents effectively negated the necessity for the reliefs
sought by respondents in their petition for Writ of Kalikasan as there was no longer any field test to enjoin.
Hence, at the time the CA rendered its Decision dated May 17, 2013, the reliefs petitioner sought and granted
by the CA were no longer capable of execution.

At this juncture, it is important to understand that the completion and termination of the field tests do not
mean that herein petitioners may inevitably proceed to commercially propagate Bt talong 83 There are three
(3) stages before genetically-modified organisms (GMOs) may become commercially available under DAO 08-
200284 and each stage is distinct, such that "[subsequent stages can only proceed if the prior stage/s [is/]are
completed and clearance is given to engage in the next regulatory stage."85 Specifically, before a genetically
modified organism is allowed to be propagated under DAO 08-2002: (a) a permit for propagation must be
secured from the BPI; (b) it can be shown that based on the field testing conducted in the Philippines, the
regulated article will not pose any significant risks to the environment; (c) food and/or feed safety studies
show that the regulated article will not pose any significant risks to human and animal health; and (d) if the
regulated article is a pest-protected plant, its transformation event has been duly registered with the
FPA.86chanrobleslaw

As the matter never went beyond the field testing phase, none of the foregoing tasks related to propagation
were pursued or the requirements therefor complied with. Thus, there are no guaranteed after-effects to the
already concluded Bt talong field trials that demand an adjudication from which the public may perceivably
benefit. Any future threat to the right of herein respondents or the public in general to a healthful and
balanced ecology is therefore more imagined than real.

In fact, it would appear to be more beneficial to the public to stay a verdict on the safeness of Bt talong - or
GMOs, for that matter - until an actual and justiciable case properly presents itself before the Court. In his
Concurring Opinion87 on the main, Associate Justice Marvic M.V.F. Leonen (Justice Leonen) had aptly pointed
out that "the findings [resulting from the Bt talong field trials] should be the material to provide more rigorous
scientific analysis of the various claims made in relation to Bt talong"88 True enough, the concluded field tests
- like those in these cases - would yield data that may prove useful for future studies and analyses. If at all,
resolving the petition for Writ of Kalikasan would unnecessarily arrest the results of further research and
testing on Bt talong, and even GMOs in general, and hence, tend to hinder scientific advancement on the
subject matter.

More significantly, it is clear that no benefit would be derived by the public in assessing the merits of field
trials whose parameters are not only unique to the specific type of Bt talong tested, but are now, in fact,
rendered obsolete by the supervening change in the regulatory framework applied to GMO field testing. To be
sure, DAO 08-2002 has already been superseded by Joint Department Circular No. 1, series of 201689 (JDC
01-2016), issued by the Department of Science and Technology (DOST), the DA, the DENR, the Department of
Health (DOH), and the Department of Interior and Local Government (DILG), which provides a substantially
different regulatory framework from that under DAO 08-2002 as will be detailed below. Thus, to resolve
respondents' petition for Writ of Kalikasan on its merits, would be tantamount to an unnecessary scholarly
exercise for the Court to assess alleged violations of health and environmental rights that arose from a past
test case whose bearings do not find any - if not minimal - relevance to cases operating under today's
regulatory framework.
Therefore, the paramount public interest exception to the mootness rule should not have been applied.

II. The case is not one capable of repetition vet evading review.

Likewise, contrary to the Court's earlier ruling,90 these cases do not fall under the "capable of repetition yet
evading review" exception.

The Court notes that the petition for Writ of Kalikasan specifically raised issues only against the field testing of
Bt talong under the premises of DAO 08-2002,91i.e., that herein petitioners failed to: (a) fully inform the
people regarding the health, environment, and other hazards involved;92 and (b) conduct any valid risk
assessment before conducting the field trial.93 As further pointed out by Justice Leonen, the reliefs sought did
not extend far enough to enjoin the use of the results of the field trials that have been completed. Hence, the
petition's specificity prevented it from falling under the above exception to the mootness rule.94chanrobleslaw

More obviously, the supersession of DAO 08-2002 by JDC 01-2016 clearly prevents this case from being one
capable of repetition so as to warrant review despite its mootness. To contextualize, JDC 01-2016 states
that:ChanRoblesVirtualawlibrary
Section 1. Applicability. This Joint Department Circular shall apply to the research, development, handling and
use, transboundary movement, release into the environment, and management of genetically-modified plant
and plant products derived from the use of modern technology, included under "regulated articles."
As earlier adverted to, with the issuance of JDC 01-2016, a new regulatory framework in the conduct of field
testing now applies.

Notably, the new framework under JDC 01-2016 is substantially different from that under DAO 08-2002. In
fact, the new parameters in JDC 01-2016 pertain to provisions which prompted the Court to invalidate DAO
08-2002. In the December 8, 2015 Decision of the Court, it was observed that: (a) DAO 08-2002 has no
mechanism to mandate compliance with international biosafety protocols;95 (b) DAO 08-2002 does not comply
with the transparency and public participation requirements under the NBF;96 and (c) risk assessment is
conducted by an informal group, called the Biosafety Advisory Team of the DA, composed of representatives
from the BPI, Bureau of Animal Industry, FPA, DENR, DQH, and DOST.97chanrobleslaw

Under DAO 08-2002, no specific guidelines were used in the conduct of risk assessment, and the DA was
allowed to consider the expert advice of, and guidelines developed by, relevant international organizations and
regulatory authorities of countries with significant experience in the regulatory supervision of the regulated
article.98 However, under JDC 01-2016, the CODEX Alimentarius Guidelines was adopted to govern the risk
assessment of activities involving the research, development, handling and use, transboundary movement,
release into the environment, and management of genetically modified plant and plant products derived from
the use of modern biotechnology.99 Also, whereas DAO 08-2002 was limited to the DA's authority in
regulating the importation and release into the environment of plants and plant products derived from the use
of modern biotechnology,100 under JDC 01-2016, various relevant government agencies such as the DOST,
DOH, DENR, and the DILG now participate in all stages of the biosafety decision-making process, with the
DOST being the central and lead agency.101chanrobleslaw

JDC 01-2016 also provides for a more comprehensive avenue for public participation in cases involving field
trials and requires applications for permits and permits already issued to be made public by posting them
online in the websites of the NCBP and the BPI.102 The composition of the Institutional Biosafety Committee
(IBC) has also been modified to include an elected local official in the locality where the field testing will be
conducted as one of the community representatives.103 Previously, under DAO 08-2002, the only requirement
for the community representatives is that they shall not be affiliated with the applicant and shall be in a
position to represent the interests of the communities where the field testing is to be
conducted.104chanrobleslaw

JDC 01-2016 also prescribes additional qualifications for the members of the Scientific and Technical Review
Panel (STRP), the pool of scientists that evaluates the risk assessment submitted by the applicant for field trial,
commercial propagation, or direct use of regulated articles. Aside from not being an official, staff or employee
of the DA or any of its attached agencies, JDC 01-2016 requires that members of the STRP: (a) must not be
directly or indirectly employed or engaged by a company or institution with pending applications for permits
under JDC 01-2016; (b) must possess technical expertise in food and nutrition, toxicology, ecology, crop
protection, environmental science, molecular biology and biotechnology, genetics, plant breeding, or animal
nutrition; and (c) must be well-respected in the scientific community.105chanrobleslaw

Below is a tabular presentation of the differences between the relevant portions of DAO 08-2002 and JDC 01-
2016:

chanRoblesvirtualLawlibrary
DAO 08-2002
JDC 01-2016
1.
As to coverage and government participation

WHEREAS, under Title IV, Chapter 4, Section 19 of the Administrative Code of 1987, the Department of
Agriculture, through the Bureau of Plant Industry, is responsible for the production of improved planting
materials and protection of agricultural crops from pests and diseases; and

ARTICLE I. GENERAL PROVISIONS

Section 1. Applicability. This Joint Department Circular shall apply to the research, development, handling and
use, transboundary movement, release into the environment, and management of genetically-modified plant
and plant products derived from the use of modern biotechnology, included under "regulated articles."
xxxx

xxxx
PART I

GENERAL PROVISIONS

ARTICLE III. ADMINISTRATIVE

FRAMEWORK
xxxx

Section 4. Role of National Government Agencies Consistent with the NBF and the laws granting their powers
and functions, national government agencies shall have the following roles:
Section 2

Coverage
A.
Scope - This Order covers the importation or release into the environment of: 1. Any plant which has been
altered or produced through the use of modern biotechnology if the donor organism, host organism, or vector
or vector agent belongs to any of the genera or taxa classified by BPI as meeting the definition of plant pest or
is a medium for the introduction of noxious weeds; or 2. Any plant or plant product altered or produced
through the use of modern biotechnology which may pose significant risks to human health and the
environment based on available scientific and technical information.
A.
[DA]. As the principal agency of the Philippine Government responsible for the promotion of agricultural and
rural growth and development so as to ensure food security and to contribute to poverty alleviation, the DA
shall take the lead in addressing biosafety issues related to the country's agricultural productivity and food
security, x x x.
B.
Exceptions. - This Order shall not apply to the contained use of a regulated article, which is within the
regulatory supervision of NCBP.
B.
[DOST]. As the premier science and technology body in the country, the DOST shall take the lead in ensuring
that the best available science is utilized and applied in adopting biosafety policies, measures and guidelines,
and in making biosafety decision, xxx.

C.
[DENRJ. As the primary government agency responsible for the conservation, management, development and
proper use of the country's environment and natural resources, the DENR shall ensure that environmental
assessments are done and impacts identified in biosafety decisions, x x x.

D.
[DOH]. The DOH, as the principal authority on health, shall formulate guidelines in assessing the health
impacts posed by modern biotechnology and its applications, x x x.

E.
[DILG]. The DILG shall coordinate with the DA, DOST, DENR and DOH in overseeing the implementation of
this Circular in relation to the activities that are to be implemented in specific LGUs, particularly in relation to
the conduct of public consultations as required under the Local Government Code. xxx.

2.
As to guidelines in risk assessment

PART I
ARTICLE II. BIOSAFETY DECISIONS

GENERAL PROVISIONS

xxxx
Section 3. Guidelines in Making Biosafety Decisions

The principles under the NBF shall guide concerned agencies in making biosafety decisions, including:

Section 3

Risk Assessment

A.
Principles of Risk Assessment - No regulated article shall be allowed to be imported or released into the
environment without the conduct of a risk assessment performed in accordance with this Order. The following
principles shall be followed when performing a risk assessment to determine whether a regulated article poses
significant risks to human health and the environment:
xxxx

B.
Risk Assessment. Risk assessment shall be mandatory and central in making biosafety decisions, consistent
with policies and standards on risk assessment issued by the NCBP; and guided by Annex III of the Cartagena
Protocol on Biosafety. Pursuant to the NBF, the following principles shall be followed when performing a risk
assessment to determine whether a regulated article poses significant risks to human health and the
environment.
1.
The risk assessment shall be carried out in a scientifically sound and transparent manner based on available
scientific and technical information. The expert advice of, and guidelines developed by, relevant international
organizations and regulatory authorities of countries with significant experience in the regulatory supervision
of the regulated article shall be taken into account in the conduct of risk assessment.
1.
The risk assessment shall be carried out in a scientifically sound and transparent manner based on available
scientific and technical information. The expert advice of and guidelines developed by, relevant international
organizations, including intergovernmental bodies, and regulatory authorities of countries with significant
experience in the regulatory supervision of the regulated article shall be taken into account. In the conduct of
risk assessment, CODEX Alimentarius Guidelines on the Food Safety Assessment of Foods Derived from the
Recombinant-DNA Plants shall be adopted as well as other internationally accepted consensus documents.

xxx

xxxx (Underscoring supplied)

3.
As to public participation

PART III

ARTICLE V. FIELD TRIAL OF

APPROVAL PROCESS FOR

REGULATED ARTICLES

FIELD TESTING OF REGULATED

ARTICLES

Section 12. Public Participation for Field Trial

xxxx
A.
The BPI shall make public all applications and Biosafety Permits for Field Trial through posting on the NCBP
and BPI websites, and in the offices of the DA and DOST in the province, city, or municipality where the field
trial will be conducted.
Section 8

Requirements for Field Testing

xxxx

xxxx

G.
Public Consultation. - The applicant, acting through its IBC, shall notify and invite comments on the field
testing proposal from the barangays and city/municipal governments with jurisdiction over the field test sites.
The IBC shall post for three (3) consecutive weeks copies of the Public Information Sheet for Field Testing
approved by the BPI in at least three (3) conspicuous places in each of the concerned barangay and
city/municipal halls. The Public Information Sheet for Field Testing shall, among others, invite interested
parties to send their comments on the proposed field testing to BPI within a period of thirty (30) days from the
date of posting. It shall be in a language understood in the community. During the comment period, any
interested person may submit to BPI written comments regarding the application. The applicant shall submit
proof of posting in the form of certifications from the concerned barangay captains and city/municipal mayors
or an affidavit stating the dates and places of posting duly executed by the responsible officer or his duly
authorized representative,

4.
As to membership in the Institutional Biosafety Committee

PART I

ARTICLE III.

GENERAL PROVISIONS

ADMINISTRATIVE FRAMEWORK

Section 1
Definition of Terms

xxxx

xxxx

L. "IBC" means the Institutional Biosafety Committee established by an applicant in preparation for the field
testing of a regulated article and whose membership has been approved by BPI. The IBC shall be responsible
for the initial evaluation of the risk assessment and risk management strategies of the applicant for field
testing. It shall be composed of at least five (5) members, three (3) of whom shall be designated as "scientist-
members" who shall possess scientific and technological knowledge and expertise sufficient to enable them to
evaluate and monitor properly any work of the applicant relating to the field testing of a regulated article. The
other members, who shall be designated as "community representatives", shall not be affiliated with the
applicant apart from being members of its IBC and shall be in a position to represent the interests of the
communities where the field testing is to be conducted. For the avoidance of doubt, NCBP shall be responsible
for approving the membership of the IBC for contained use of a regulated article.

Section 6. Institutional Biosafety Committee The company or institution applying for and granted permits
under this Circular shall constitute an IBC prior to the contained use, confined test, or field trial of a regulated
article. The membership of the IBC shall be approved by the DOST-BC for contained use or confined test, or
by the DA-BC for field trial. The IBC is responsible for the conduct of the risk assessment and preparation of
risk management strategies of the applicant for contained use, confined test, or field trial. It shall make sure
that the environment and human health are safeguarded in the conduct of any activity involving regulated
articles. The IBC shall be composed of at least five (5) members, three (3) of whom shall be designated as
scientist-members and two (2) members shall be community representatives, All scientist-members must
possess scientific or technological knowledge and expertise sufficient to enable them to property evaluate and
monitor any work involving regulated articles conducted by the applicant.

x x x x (Underscoring supplied)

The community representative must not be affiliated with the applicant, and must be in a position to represent
the interests of the communities where the activities are to be conducted. One of the community
representatives shall be an elected official of the LGU. The other community representative shall be selected
from the residents who are members of the Civil Society Organizations represented in the Local Poverty
Reduction Action Team, pursuant to DILG Memorandum Circular No. 2015-45. For multi-location trials,
community representatives of the IBC shall be designated per site, x x x. (Underscoring supplied)

5. As to the composition and qualifications of the members of the Scientific and Technical Review Panel
PART I

ARTICLE III. ADMINISTRATIVE

GENERAL PROVISIONS

FRAMEWORK

Section 1

xxxx

Definition of Terms

Section 7. Scientific and Technical Review Panel (STRP) The DA shall create a Scientific and Technical Review
Panel composed of a pool of non-DA scientists with expertise in the evaluation of the potential risks of
regulated articles to the environment and health, x x x

xxxx

EE. "STRP" means the Scientific and Technical Review Panel created by BPI as an advisory body, composed of
at least three (3) reputable and independent scientists who shall not be employees of the Department and
who have the relevant professional background necessary to evaluate the potential risks of the proposed
activity to human health and the environment based on available scientific and technical information.

xxxx

The DA shall select scientists/experts in the STRP, who shall meet the following qualifications:

x x x x (Underscoring supplied)
A.
Must not be an official, staff or employee of the DA or any of its attached agencies;

B.
Must not be directly or indirectly employed or engaged by a company or institution with pending applications
for permits covered by this Circular;

C.
Possess technical expertise in at least one of the following fields: food and nutrition; toxicology, ecology, crop
protection, environmental science, molecular biology and biotechnology, genetics, plant breeding, animal
nutrition; and

D.
Well-respected in the scientific community as evidenced by positions held in science-based organizations,
awards and recognitions, publications in local and international peer- reviewed scientific journals.

x x x x (Underscoring supplied)
Based on the foregoing, it is apparent that the regulatory framework now applicable in conducting risk
assessment in matters involving the research, development, handling, movement, and release into the
environment of genetically modified plant and plant products derived from the use of modern biotechnology is
substantially different from that which was applied to the subject field trials. In this regard, it cannot be said
that the present case is one capable of repetition yet evading review.

The essence of cases capable of repetition yet evading review was succinctly explained by the Court in Belgica
v. Ochoa, Jr.,106 where the constitutionality of the Executive Department's lump-sum, discretionary funds
under the 2013 General Appropriations Act, known as the Priority Development Assistance Fund (PDAF), was
assailed. In that case, the Court rejected the view that the issues related thereto had been rendered moot and
academic by the reforms undertaken by the Executive Department and former President Benigno Simeon S.
Aquino Ill's declaration that he had already "abolished the PDAF." Citing the historical evolution of the
ubiquitous Pork Barrel System, which was the source of the PDAF, and the fact that it has always been
incorporated in the national budget which is enacted annually, the Court ruled that it is one capable of
repetition yet evading review, thus:ChanRoblesVirtualawlibrary
Finally, the application of the fourth exception [to the rule on mootness] is called for by the recognition that
the preparation and passage of the national budget is, by constitutional imprimatur, an affair of annual
occurrence. The relevance of the issues before the Court does not cease with the passage of a "PDAF-free
budget for 2014." The evolution of the "Pork Barrel System," by its multifarious iterations throughout the
course of history, lends a semblance of truth to petitioners' claim that "the same dog will just resurface
wearing a different collar." In Sanlakas v. Executive Secretary, the government had already backtracked on a
previous course of action yet the Court used the "capable of repetition but evading review" exception in order
"[t]o prevent similar questions from re-emerging." The situation similarly holds true to these cases. Indeed,
the myriad of issues underlying the manner in which certain public funds are spent, if not resolved at this most
opportune time, are capable of repetition and hence, must not evade judicial review.107 (Emphases supplied)
Evidently, the "frequent" and "routinary" nature of the Pork Barrel Funds and the PDAF are wanting herein. To
reiterate, the issues in these cases involve factual considerations which are peculiar only to the controversy at
hand since the petition for Writ of Kalikasan is specific to the field testing of Bt talong and does not involve
other GMOs.

At this point, the Court discerns that there are two (2) factors to be considered before a case is deemed one
capable of repetition yet evading review: (1) the challenged action was in its duration too short to be fully
litigated prior to its cessation or expiration; and (2) there was a reasonable expectation that the same
complaining party would be subjected to the same action.

Here, respondents cannot claim that the duration of the subject field tests was too short to be fully litigated. It
must be emphasized that the Biosafety Permits for the subject field tests were issued on March 16, 2010 and
June 28, 2010, and were valid for two (2) years. However, as aptly pointed out by Justice Leonen,
respondents filed their petition for Writ of Kalikasan only on April 26, 2012 -just a few months before the
Biosafety Permits expired and when the field testing activities were already over.108 Obviously, therefore, the
cessation of the subject field tests before the case could be resolved was due to respondents' own inaction.

Moreover, the situation respondents complain of is not susceptible to repetition. As discussed above, DAO 08-
2002 has already been superseded by JDC 01-2016. Hence, future applications for field testing will be
governed by JDC 01-2016 which, as illustrated, adopts a regulatory framework that is substantially different
from that of DAO 08-2002.

Therefore, it was improper for the Court to resolve the merits of the case which had become moot in view of
the absence of any valid exceptions to the rule on mootness, and to thereupon rule on the objections against
the validity and consequently nullify DAO 08-2002 under the premises of the precautionary principle.

In fact, in relation to the latter, it is observed that the Court should not have even delved into the
constitutionality of DAO 08-2002 as it was merely collaterally challenged by respondents, based on the
constitutional precepts of the people's rights to information on matters of public concern, to public
participation, to a balanced and healthful ecology, and to health.109 A cursory perusal of the petition for Writ
of Kalikasan filed by respondents on April 26, 2012 before the Court shows that they essentially assail herein
petitioners' failure to: (a) fully inform the people regarding the health, environment, and other hazards
involved;110 and (b) conduct any valid risk assessment before conducting the field trial.111 However, while
the provisions of DAO 08-2002 were averred to be inadequate to protect (a) the constitutional right of the
people to a balanced and healthful ecology since "said regulation failed, among others, to anticipate 'the public
implications caused by the importation of GMOs in the Philippines"';112 and (b) "the people from the potential
harm these genetically modified plants and genetically modified organisms may cause human health and the
environment, [and] thus, x x x fall short of Constitutional compliance,"113 respondents merely prayed for its
amendment, as well as that of the NBF, to define or incorporate "an independent, transparent, and
comprehensive scientific and socio-economic risk assessment, public information, consultation, and
participation, and providing for their effective implementation, in accord with international safety
standards[.]"114 This attempt to assail the constitutionality of the public information and consultation
requirements under DAO 08-2002 and the NBF constitutes a collateral attack on the said provisions of law that
runs afoul of the well-settled rule that the constitutionality of a statute cannot be collaterally attacked as
constitutionality issues must be pleaded directly and not collaterally.115 Verily, the policy of the courts is to
avoid ruling on constitutional questions and to presume that the acts of the political departments are valid,
absent a clear and unmistakable showing to the contraiy, in deference to the doctrine of separation of powers.
This means that the measure had first been carefully studied by the executive department and found to be in
accord with the Constitution before it was finally enacted and approved.116chanrobleslaw

All told, with respondents' petition for Writ of Kalikasan already mooted by the expiration of the Biosafety
Permits and the completion of the field trials subject of these cases, and with none of the exceptions to the
mootness principle properly attending, the Court grants the instant motions for reconsideration and hereby
dismisses the aforesaid petition. With this pronouncement, no discussion on the substantive merits of the
same should be made.
WHEREFORE, the motions for reconsideration are GRANTED. The Decision dated December 8, 2015 of the
Court, which affirmed with modification the Decision dated May 17, 2013 and the Resolution dated September
20, 2013 of the Court of Appeals in CA-G.R. SP No. 00013, is hereby SET ASIDE for the reasons above-
explained. A new one is ENTERED DISMISSING the Petition for Writ of Continuing Mandamus and Writ of
Kalikasan with Prayer for the Issuance of a Temporary Environmental Protection Order (TEPO) filed by
respondents Greenpeace Southeast Asia (Philippines), Magsasaka at Siyentipiko sa Pagpapaunladng
Agrikultura, and others on the ground of mootness.

SO ORDERED.chanRoblesvirtualLawlibrary

16. ATITIW VS ZAMORA

508 Phil. 321

TINGA, J.:
PROLOGUE
The ethnographic diversity of the Filipino people is a source of national pride, enriching as it has, our nation's
culture. Nonetheless, it has likewise been the source, on occasion, of political discomfort. The inherent right of
peoples to maintain their traditional way of life has not always met a welcome response from the entrenched
majority. The perceived discriminatory treatment of cultural minorities has in turn engendered unrest.
The restoration of democracy, with the resultant promulgation of the 1987 Constitution, has allowed more
room for creative solutions that accord the utmost respect to the rights and traditions of cultural minorities.
Regional autonomy is one of the preferred solutions in the Constitution, and one which the Court has been all
too willing to affirm or defer to. It is a solution long dreamed of by ethnic minorities around the world, and its
growing acceptance in the international realm is but a further step in the evolution of world civilizations
towards the humane, democratic ideal.
There is a certain element of tragedy in the present petition, as it arises from the failure to this day to vitalize
the dream of local autonomy of the Cordillera people. It might seem to some that the Court will compound the
tragedy by denying, as it does, the present petition. Yet there are fundamental prerogatives that have to be
upheld, particularly the powers of Congress over the national purse and to legislate, both of which it exercises
in representation of the sovereign people. Neither the goal of regional autonomy nor the unique status of the
Cordillera people cannot hinder the rule of law and the Constitution.
THE PETITION
Petitioners Nestor G. Atitiw, Maylene D. Gayo, Florencio Kigis, and Modesto Sagudang have brought to this
Court the instant petition for prohibition, mandamus, and declaratory relief as taxpayers and officers and
members of the various units of the Cordillera Administrative Region (CAR). They seek, among others, the
declaration of nullity of paragraph 1 of the Special Provisions of Republic Act No. 8760, otherwise known as
the General Appropriations Act (GAA) of 2000, directing that the appropriation for the CAR shall be spent to
wind up its activities and pay the separation and retirement benefits of all affected officials and employees.
The 2000 GAA appropriated a total of P18,379,000.00 for the CAR's general administration and support
services for that year, in contrast to the annual appropriation of P36,000,000.00 in the previous years.
Named respondents are the Executive Secretary, the Secretary of the Department of Budget and Management
(DBM), and the Republic of the Philippines.
While the petition is based on Rule 65 of the Rules of Court in regard to prohibition and mandamus, petitioners
also ask for the issuance of a writ of preliminary injunction and/or temporary restraining order to enjoin
respondents from implementing the questioned provision and a writ of preliminary mandatory injunction
commanding the Executive Secretary and the DBM to source out funds for the immediate resumption of
operations of the CAR pending consideration of the petition. As the 2000 GAA has long been implemented, the
application for the issuance of a writ of preliminary injunction and/or temporary restraining order is already
moot and academic. Nonetheless, the Court shall pass upon the constitutional issues raised in this petition.
FACTS
A brief historical account of the CAR is in order.
When President Corazon Aquino assumed the presidency after the EDSA people power revolt, she was
confronted with the insurgency in the Cordilleras, a problem of long standing which dates back to the martial
rule of then President Marcos. Thus, her government initiated a series of peace talks with the Cordillera
People's Liberation Army (CPLA) and the Cordillera Bodong Administration (CBA), both headed by Fr. Conrado
Balweg. The dialogues between the representatives of the government and the CPLA centered on the
establishment of an autonomous government in the Cordilleras and culminated in the forging of a Joint
Memorandum of Agreement on September 13, 1986, whereby the Armed Forces of the Philippines and the
CPLA had agreed to end hostilities.
On February 2, 1987, the Filipino people ratified the 1987 Philippine Constitution. Section 15, Article X[1]
thereof ordains the creation of autonomous regions in Muslim Mindanao and in the Cordilleras while Section
18, Article X[2] thereof mandates the congressional enactment of the organic acts for each of the autonomous
regions.
After the cessation of hostilities, the dialogues went on and these paved the way for the signing on March 27,
1987 of a Joint Statement of the Government Panel and the Cordillera Panel, enjoining the drafting of an
executive order to authorize the creation of a policy-making and administrative body for the Cordilleras and to
conduct studies on the drafting of an organic act for the autonomous region. Thus, by virtue of her residual
legislative powers under the Freedom Constitution, President Aquino promulgated Executive Order (E.O.) No.
220 on July 15, 1987, creating the CAR, which is the interim and preparatory body tasked, among others, to
administer the affairs of government in the Cordilleras composed of the provinces of Abra, Benguet, Ifugao,
Kalinga-Apayao and Mountain Province and the City of Baguio.
Pursuant to the 1987 Constitution, on October 23, 1989, Congress enacted Republic Act No. 6766 entitled An
Act Providing for an Organic Act for the Cordillera Autonomous Region. On January 30, 1990, a plebiscite was
held wherein the people of the aforementioned provinces and city cast their votes on the ratification of the
Organic Act. The plebiscite results showed, however, that the creation of an autonomous region was approved
by a majority of votes in the Ifugao province only and overwhelmingly rejected in the rest of the region. In
Ordillo v. Commission on Elections[3] the Court ruled that the sole province of Ifugao cannot validly constitute
the Cordillera Autonomous Region and upheld the disapproval of the Organic Act by the people of the region.
In said case, the Court also declared E.O. No. 220 to be still in force and effect until properly repealed or
amended.
On February 15, 2000, President Estrada signed into law the 2000 GAA which includes the assailed Special
Provisions.
On July 20, 2000, President Estrada issued E.O. No. 270, which extended the implementation of the winding
up of operations of the CAR.[4] He extended the period further to March 31, 2001 by virtue of E.O. No. 328
which he issued on December 27, 2000.[5]
ISSUES
The instant petition raises the following remolded issues:

WHETHER THE ASSAILED SPECIAL PROVISIONS IN R. A. NO. 8760 (2000 GAA) IS A RIDER AND AS SUCH IS
UNCONSTITUTIONAL;

WHETHER THE PHILIPPINE GOVERNMENT, THROUGH CONGRESS, CAN UNILATERALLY AMEND/REPEAL E.O.
No. 220;

WHETHER THE REPUBLIC SHOULD BE ORDERED TO HONOR ITS COMMITMENTS AS SPELLED OUT IN E.O.
No. 220.[6]
THE COURT'S RULING The petition is bereft of merit.
The lead appropriation item for the CAR in the 2000 GAA reads in part:
XXX. AUTONOMOUS REGIONS
A. CORDILLERA ADMINISTRATIVE REGION (PROPER)
For general administration and support services, support to operation, and operation, as indicated hereunder
P18,379,000
New Appropriations, by Program/Project
. . . .
Right after the appropriation item are the following Special Provisions, thus:
Special Provisions

Use of the Fund. The amounts herein appropriated shall be used to wind up the activities and operations of
the Cordillera Administrative Region, including the payment of separation and retirement benefits of all
affected officials and employees; PROVIDED, That any deficiency in the amount for the payment of terminal
leave and retirement gratuity benefits shall be taken from the Miscellaneous Personnel Benefits Fund.

Appropriations for Programs and Specific Activities. The amounts herein appropriated for the programs of the
agency shall be used specifically for the following activities in the indicated amounts and conditions: . . .[7]
Petitioners argue that the above-quoted paragraph 1 of the Special Provisions is a prohibited rider which
contravenes Section 25(2), Article VI of the Constitution, which reads:
SEC. 25 (2) No provision or enactment shall be embraced in the general appropriations bill unless it relates
specifically to some particular appropriation therein. Any such provision or enactment shall be limited in its
operation to the appropriation to which it relates.
It is a jurisprudential axiom that respect for the inherent and stated powers and prerogatives of the law-
making body, as well as faithful adherence to the principle of separation of powers, requires that its
enactments be accorded the presumption of constitutionality. Thus, in any challenge to the constitutionality of
a statute, the burden of clearly and unequivocally proving its unconstitutionality always rests upon the
challenger. Conversely, failure to so prove will necessarily defeat the challenge.[8] The instant petition falls
short of the requirement necessary to overturn the presumption of constitutionality which the questioned
provision enjoys.
A rider is a provision which is alien to or not germane to the subject or purpose of the bill in which it is
incorporated. There are two provisions in the 1987 Constitution which expressly prohibit riders. These are
provisions in Article VI of the Constitution, namely Section 25(2) and Section 26(1), which
Sec. 25. ... . ..
...
(2) No provision or enactment shall be embraced in the general appropriations bill unless it relates specifically
to some particular appropriation therein. Any such provision or enactment shall be limited in its operation to
the appropriation to which it relates.
Sec. 26. ... . ..
...
(1) Every bill passed by the Congress shall embrace only one subject which shall be expressed in the title
thereof.
The rationale against inserting a rider in an appropriations bill under the specific appropriation clause
embodied in Section 25(2), Article VI of the Constitution is similar to that of the "one subject in the title"
clause provided in Section 26(1) also of Article VI, which directs that every provision in a bill must be germane
or has some reasonable relation to the subject matter as expressed in the title thereof. The unity of the
subject matter of a bill is mandatory in order to prevent hodge-podge or logrolling legislation, to avoid surprise
or fraud upon the legislature, and to fairly appraise the people of the subjects of legislation that are being
considered.[9]
An appropriations bill, however, covers a broader range of subject matter and therefore includes more details
compared to an ordinary bill. As a matter of fact, the title of an appropriations bill cannot be any broader as it
is since it is not feasible to come out with a title that embraces all the details included in an appropriations bill.
This is not to sanction, however, the insertion of provisions or clauses which do not have any relation to
appropriations found therein. Thus, Section 25(2), Article VI lays down a germaneness standard akin to that
prescribed in Section 26(1).
Compliance with the requirement under Section 25(2), Article VI of the Constitution is mandatory. However,
the rule should not be construed so strictly as to tie the hands of Congress in providing budgetary policies in
the appropriations bill.
The subsection simply requires that all the provisions in a general appropriations bill are either appropriation
items or non-appropriation items which relate specifically to appropriation items. Thus, provisions or clauses
that do not directly appropriate funds are deemed appurtenant in a general appropriations bill when they
specify certain conditions and restrictions in the manner by which the funds to which they relate have to be
spent.
In Gonzales v. Macaraig, Jr.,[10] the Court struck down Section 55 and Section 16 of the appropriations acts
for the fiscal years 1989 and 1990, respectively, because they were not provisions in the budgetary sense of
the term. Both sections disallowed the use of savings from appropriations authorized for other purposes to
augment any item of appropriation which was reduced or disapproved by Congress. The Court explained
therein:
Explicit is the requirement that a provision in the Appropriations Bill should relate specifically to some
"particular appropriation" therein. The challenged "provisions" fall short of this requirement. Firstly, the vetoed
"provisions" do not relate to any particular or distinctive appropriation. They apply generally to all items
disapproved or reduced by Congress in the Appropriations Bill. Secondly, the disapproved or reduced items are
nowhere to be found on the face of the Bill. To discover them, resort will have to be made to the original
recommendation made by the President and to the source indicated by petitioners themselves,.... Thirdly, the
vetoed Sections are more of an expression of Congressional policy in respect of augmentation from savings
rather than a budgetary appropriation."[11]
Therefore, in order that a provision or clause in a general appropriations bill may comply with the test of
germaneness, it must be particular, unambiguous, and appropriate. A provision or clause is particular if it
relates specifically to a distinct item of appropriation in the bill and does not refer generally to the entire
appropriations bill. It is unambiguous when its application or operation is apparent on the face of the bill and it
does not necessitate reference to details or sources outside the' appropriations bill. It is an appropriate
provision or clause when its subject matter does not necessarily have to be treated in a separate legislation.
The assailed paragraph of the Special Provisions, insofar as it limits the spending of the appropriation for CAR
to the winding up of its activities, does not constitute a rider. It precisely follows the standard that a provision
in an appropriations bill must relate specifically to some particular appropriation therein. Said paragraph meets
the germaneness standard because it lays down a limitation or restriction on the use of a specific appropriation
item already provided in the 2000 GAA. Its operation is expressly confined to the budgetary allocation for the
CAR. Reference to other provisions of the 2000 GAA or to details in other laws is not called for. Said provision
did not have to be the subject of separate legislation because precisely the budgetary policy of Congress not
to support the programs of the CAR was properly made a part of the 2000 GAA.
It is beyond dispute that inherent in the power of appropriation is the power to specify how money shall be
spent; and that in addition to distinct "items" of appropriation, the legislature may include in appropriations
bills qualifications, conditions, limitations or restrictions on expenditure of funds.[12] The only limitation is that
restrictions or conditions in an appropriations bill must exhibit a connection with money items in a budgetary
sense in the schedule of expenditures.[13]
According to petitioners, however, paragraph 1 of the Special Provisions, allotting as it does the funds for the
winding up of activities and operations of the CAR, is foreign to the general subject of the GAA. They argue
that instead of providing a budget for the CAR, it violates the purpose (of the 2000 GAA) by not providing for
the proper and reasonable budget for the CAR.
Quite the contrary, said provision is necessarily related to the budgetary allocation for the CAR because it sets
forth the purposes for which the funds shall be spent, that is, for the winding up of the activities and payment
of separation and retirement benefits of all affected officials of the CAR. Clearly, the policy of Congress was to
discontinue budgetary support for the programs and activities thereto for undertaken through the CAR.
Petitioners posit that the questioned paragraph in the 2000 GAA had the effect of abolishing the CAR, more so
that the appropriation therein was ordained to be used for the winding up of the affairs of the CAR. Since a
special law created the CAR, petitioners argue that the 2000 GAA is "not the place for amending or repealing a
standing law."
The CAR was not abolished, as concluded by petitioners, with the reduction of its budgetary allocation; what
took place was only a discontinuance of its programs and activities. In fact, E.O. No. 328, the implementing
rule of the questioned Special Provisions, provides only for the deactivation of the CAR bodies upon the lapse
of its operational period as provided in the E.O. The pertinent sections read:
SECTION 1. Government Operations. For purposes of Governmental operations, the integrity of the Cordillera
Administrative Region as composed of the provinces of Abra, Benguet, Ifugao, Kalinga Apayao and Mt.
Province and the Chartered City of Baguio shall be maintained as created by virtue of E.O. 220 and all regional
offices and agencies of the National Government established in the Cordillera Administrative Region shall
continue to serve the region.
... ... ...
SECTION 3. Development Council. The Cordillera Regional Assembly and the Cordillera Executive Board shall
continue in the meantime its development concerns for the CAR during the period.
... ... ...
SECTION 8. Extension of Period. The Special TariTForce, in coordination with other concerned agencies is
hereby given until March 31, 2001 within which to implement the deactivation of the CAR bodies. It shall be
assisted by a skeletal force consisting of personnel occupying positions listed in Annex "A" hereof for the task
of winding-up of CAR operations and the safekeeping of its resources. ... Unless otherwise transferred to other
agencies, members of the skeletal force will be deemed separated from the service after March 31, 2001
unless otherwise provided for by law.
There is a distinction between the words "deactivate" and "abolish." To "deactivate" means to render inactive
or ineffective or to break up by discharging or reassigning personnel, while to "abolish" means to do away
with, to annul, abrogate or destroy completely. In essence, abolition denotes an intention to do away with the
office wholly and permanently. Thus, while in abolition the office ceases to exist, the same is not true in
deactivation where the office continues to exist, albeit remaining dormant or inoperative. Be that as it may,
deactivation and abolition are both reorganization measures.[14]
However, even assuming that the limitation on the CAR's budget had the effect of abolishing certain offices,
the authority of Congress to do so cannot be denied and should be recognized. Except for such offices as are
created by the Constitution, the creation of public offices is primarily a legislative function. Insofar as the
legislative power in this respect is not restricted by constitutional provisions, it is supreme; the legislature may
decide for itself what offices are suitable, necessary, or convenient. When in the exigencies of government, it
is necessary to create and define duties the legislative branch has the discretion to determine whether
additional offices shall be created, or whether these duties shall be attached to and become ex-oficio duties of
existing offices. An office created by the legislature is wholly within the power of that body, and it may
prescribe the mode of filling the office and the powers and duties of the incumbent, and, if it sees fit, abolish
the office.[15]
Petitioners' argument that the abolition of the CAR violates the constitutional mandate that there shall be
autonomous regions in Muslim Mindanao and the Cordilleras is without merit. The CAR created by virtue of
E.O. No. 220 is not the autonomous region contemplated in the Constitution. A reading of E.O. No. 220 easily
reveals that what it actually envisions is the consolidation and coordination of the delivery of services of line
departments and agencies of the National Government in the areas covered by the administrative region as a
step preparatory to the grant of autonomy to the Cordilleras.[16] E.O. No. 220 has not established an
autonomous regional government. Instead, it has created a region, covering a specified area, for
administrative purposes with the main objective of coordinating the planning and implementation of programs
and services; indeed, as its very name denotes it is a mere administrative region.[17] The bodies created by
E.O. No. 220 do not supplant the existing local government structure, nor are they autonomous government
agencies. They merely constitute the mechanism for an "umbrella" that brings together the existing local
governments, the agencies of the National Government, the ethno-linguistic groups or tribes, and non-
governmental organizations in a concerted effort to spur development in the Cordilleras.[18] Considering the
control and supervision exercised by the President over the CAR and the offices created under E.O. No. 220,
and considering further the indispensable participation of the line departments of the National Government,
the CAR may be considered more than anything else as a regional coordinating agency of the National
Government, similar to the regional development councils which the President may create under the
Constitution.[19] In this wise, the CAR may be considered as a more sophisticated version of the regional
development council.[20]
The second and third assigned errors are interrelated and shall be discussed jointly. Petitioners contend that
E.O. No. 220 is a product of peace negotiations and is in the nature of a social and political contract, which
Congress cannot unilaterally amend or repeal. Petitioners argue that the Republic is bound to fully implement
the provisions of E.O. No. 220; otherwise, the Republic would be guilty of a breach of its peace agreement
with the CBA-CPLA. Petitioners also seek to compel respondents "to source out funds for the immediate
resumption of the CAR-Proper."
Except for the contention that the assailed paragraph is unconstitutional for being a rider, the rest of
petitioners' arguments look into the wisdom and efficacy of said provision, matters which are beyond this
Court's power of judicial review. The arguments of petitioners should properly be addressed to the political
branches of government. While the Court has resolved to take jurisdiction over this petition which questions
acts of the political branches, the principle remains that it is powerless to review the wisdom, merits, or
propriety thereof, as it may strike them down only on either of two grounds: (1) unconstitutionality or
illegality, and (2) grave abuse of discretion.[21]
Petitioners' grievance that the budget for the CAR's administration and operations is unreasonable or
insufficient should be raised before Congress. It involves the question of wisdom of the law which is beyond
the province of this Court to inquire. An inquiry of that sort amounts to a derogation of the principle of
separation of powers. Courts have no authority to grant relief against the evils that may result from the
operation of unwise or imperfect legislation, unless its flaw partakes the nature of a constitutional
infirmity.[22]
From another fundamental standpoint, however, petitioners' contention that Congress cannot unilaterally
amend or repeal E.O. No. 220 must be rejected. There is no such thing as an irrepealable law. Nothing could
prevent Congress from amending or repealing E.O. No. 220 in the event it decides to do so. While it is true
that E.O. No. 220 is a law as it was promulgated by then President Aquino in the exercise of her extraordinary
legislative power under the Freedom Constitution, said E.O. is no different from any other law. It is subject to
amendment or repeal by the plenary power of Congress. Since the ratification of the 1987 Constitution, the
power to make, amend, or repeal laws has been lodged exclusively with Congress, except to the extent
reserved to the people through initiative and referendum.[23]
The Court is also without authority to compel the Executives branch to implement the provisions of E.O. No.
220 or to restore its budgetary allocation to its previous level. As correctly pointed out by the Solicitor General,
no money shall be paid out of the Treasury except in pursuance of an appropriation made by law.[24]
The three branches of government must discharge their respective functions within the limits of authority
conferred by the Constitution. Under the principle of separation of powers, the Congress, the President, and
the Judiciary may not encroach on fields allocated to the other branches of government. The legislature is
generally limited to the enactment of laws, the executive to the enforcement of laws, and the judiciary to their
interpretation and application to cases and controversies.[25] The Court has consistently stressed that "the
doctrine of separation of powers calls for the executive, legislative and judicial departments being left alone to
discharge their duties as they see fit."[26] The concept of separation of powers presupposes mutual respect
by and between the three departments of the government.[27] Therefore, the implementation of E.O. No. 220
is an executive prerogative while the sourcing of funds to support the CAR's activities is within the province of
the legislature. Absent any grave abuse of discretion, the Court cannot correct the acts of either the Executive
or Congress in respect to the policies concerning the CAR.
CONCLUSION
The creation of autonomous regions does not signify the establishment of a sovereignty distinct from that of
the Republic, as it can be installed only "within the framework of this Constitution and the national sovereignty
as well as territorial integrity of the Republic of the Philippines."[28] Under the 1987 Constitution, the creation
of the autonomous regions shall be effective when approved by a majority of the votes cast by the constituent
units in a plebiscite called for the purpose.[29] In the case of the Cordilleras, the overwhelming majority of its
people had voted against regional autonomy.
Petitioners cannot charge the Government of reneging on its obligation under the peace agreement. Precisely,
the Government had come out with the Organic Act for the Cordillera Autonomous Region and submitted the
same for ratification by the people. It was not called upon to ensure the ratification of the Organic Act by the
people.[30]
EPILOGUE
The Court is sympathetic to the pleas of petitioners. The institution of the instant petition underscores the
pressing need for regional autonomy of the Cordillera people, a number of whom have fought hard and
sacrificed their lives if only to advance their cause for autonomy and self-determination. From the standpoint
of policy, regional autonomy is also a means of solving existing serious peace and order problems and
secessionist movements.[31] Establishing a system of governance for the Cordillera people that promotes their
way of life and heritage, recognizes their indigenous rights, and allows them to chart their destiny as a people
within the framework of national sovereignty still remains an unanswered call. It is hoped that Congress will
pass another Organic Act which is finally acceptable to the people of the Cordilleras.
ADJUDICATION
WHEREFORE, the instant Petition for Prohibition and Mandamus is DENIED. No pronouncement as to costs.
SO ORDERED.
17. ACTING REGISTRARS OF LAND TITLES AND DEEDS VS RTC

G.R. No. 81564 April 26, 1990

ACTING REGISTRARS OF LAND TITLES AND DEEDS OF PASAY CITY, PASIG AND MAKATI, METRO MANILA,
petitioners,
vs.
THE REGIONAL TRIAL COURT, BRANCH 57, IN MAKATI, METRO MANILA PRESIDED OVER BY THE
HONORABLE JUDGE FRANCISCO X. VELEZ, AND THE INTESTATE ESTATE OF THE LATE DELFIN CASAL,
represented by DOMINGO C. PALOMARES, ADMINISTRATOR, respondents.
G.R. No. 90176 April 26, 1990
THE INTESTATE ESTATE OF THE LATE DELFIN CASAL, represented by DOMINGO C. PALOMARES,
ADMINISTRATOR, petitioner,
vs.
HONORABLE CONRADO VASQUEZ, JR., Presiding Judge, BRANCH 118, RTC, RICARDO P. SANTIAGO, ET AL.,
respondents.
Tañada, Vivo & Tan for the Intestate Estate of the Late Delfin Casal.
Antonio J. Dalangpan for himself and the heirs of Delfin Casal.
Pedro S. Ravelo for Gerardo Casal.
Filomeno Peralta, Jr. for Domingo C. Palomares.

SARMIENTO, J.:
The petitioners ** charge His Honor, Judge Francisco Velez, of the Regional Trial Court, Branch 57, Makati,
Metro Manila, with grave abuse of discretion in issuing an order authorizing the private respondent, through
Domingo Palomares, to perform acts of ownership over a 2,574-hectare parcel of land known as Hacienda de
Maricaban spread out in various parts of Makati, Pasig, Taguig, Pasay City, and Parañaque. There is no
controversy as to the facts.
On November 5, 1985, the private respondent, Domingo Palomares, as administrator of the heirs of Delfin
Casal, commenced suit with the Regional Trial Court, Branch 132, Makati, Metro Manila for declaratory relief,
quieting of title, cancellation of Transfer Certificate of Title No. 192, and cancellation of entries upon Original
Certificate of Title No. 291.
Palomares had earlier come to this Court (February 27, 1985) on a similar petition, and in addition, to direct
the Register of Deeds to issue a duplicate owner's copy of Original Certificate of Title No. 291, embracing
allegedly Hacienda de Maricaban, in lieu of the (alleged) lost one. On September 9, 1985, the Court denied the
petition for lack of merit. (G.R. No. 69834).
On December 19, 1985, the petitioners filed their answer.
On June 2, 1986, the private respondent filed a motion to admit amended complaint impleading the Republic
of the Philippines and the Registers of Deeds of Pasig, Makati, and Pasay City as parties-respondents, and
alleging, among other things, that: (1) on October 1, 1906, the Court of Land Registration (James Ostrand,
Presiding Judge) confirmed the title of Dolores Pascual Casal y Ochoa, a native of Madrid, Spain, over the
2,574-hectare parcel above-mentioned; (2) on October 17, 1906, the Register of Deeds of Rizal issued OCT
No. 291 in her name; (3) upon her death, and successive deaths of her heirs, the property devolved on
Gerardo, Reynaldo, Lolita, and Erlinda, all surnamed Casal, great grandchildren of Dolores; (4) no conveyances
or dispositions of any kind have been allegedly made upon the parcel; (5) TCT No. 192, which covers the
same landholding, is allegedly spurious and inexistent; (6) the State itself, by placing 27,213,255 square
meters thereof under a military reservation (Fort McKinley now Fort Bonifacio), by Proclamation No. 423, and
fifty hectares thereof pursuant to Proclamation No. 192, had been guilty of landgrabbing; (7) any and all
holders of any and all TCTs emanating therefrom or from TCT No. 192, are null, void, and of no force and
effect; and (8) as a consequence thereof, the heirs of Dolores Casal suffered various damages and attorney's
fees.
On June 26, 1986, the petitioners filed an answer, stating, among other things, that: (1) the estate of Dolores
Casal (or Delfin Casal, her grandchild) is not a juridical person authorized by law to bring suit; (2) the
Registers of Deeds of Makati, Pasig, and Pasay City are not the real parties in interest, but rather, the
registered owners over which the court had not acquired jurisdiction; (3) the non-joinder of the real parties in
interest is fatal; (4) OCT No. 291 has long been cancelled; (5) Judge Gregorio Pineda of the then Court of First
Instance of Rizal, Branch XXI, Pasig, had earlier denied prayers for the issuance of duplicate owner's copy of
OCT No. 291 because the land embraced therein had been validly delivered to the Government; (6) the
Supreme Court itself had denied the Casals' appeal; *** (7) as a consequence, res judicata is a bar; (8)
prescription has also set in; and (9) the Casal's claims can not validly override the titles of innocent purchasers
for value.
On August 29, 1986, the respondent judge issued a temporary restraining order, directing the petitioners to
cease and desist from performing the acts complained of.
In a subsequent memorandum, the petitioners alleged that Dolores Casal had conveyed the property to the
Government of the United States in 1906 and the Manila Railroad Company on which Judge Ostrand, the
Presiding Judge of the Court of Land Registration, later Justice of this Court, had stamped his imprimatur.
On October 12, 1987, the respondent court issued an order in the tenor, as follows:
No other opposition having been registered, this Court hereby resolves to grant the plaintiffs' prayer in the
OMNIBUS MOTION in order to safeguard the integrity of the land embraced in OCT 291, hereby authorizing
for this purpose the plaintiff Domingo C. Palomares:
1. To order such subdivision and/or individual survey or surveys within Parcel II, Parcel III and Parcel IV under
Survey Plan Psu-2031 by a licensed geodetic engineer or engineers at plaintiffs' expense in order to facilitate
and simplify the efficient administration of the property described in OCT 291; and
2. To sell, exchange, lease or otherwise dispose (of) any area or areas or portion or portions thereof, subject
to the approval of the Intestate Estate Court, to cover expenses for the payment of taxes to which the
property is subject, as well as expenses of administration and for the protection of the integrity of the said
lands.
SO ORDERED. 1
Eleven days later, or on October 23, 1987 to be precise, it issued another order, as follows:
Acting on the plaintiffs MOTION dated October 15, 1987 praying for the issuance of a Writ of Execution
implementing the Order of this Court dated October 12, 1987 before the expiration of the time to appeal, and
after inquiring from the plaintiff's counsel for their reason in seeking the same, the Court hereby issues this
clarificatory order affirming the power of the plaintiff Domingo C. Palomares to execute and perform the acts
authorized in the said Order of October 12, 1987 without the need of a Writ of Execution, where no relief has
been sought therefrom by any party, said Order being implementable at the instance of the said plaintiff
Domingo C. Palomares, anytime when the said Order becomes final 15 days after the said plaintiff received
copy of the same (see Section 39, Chapter IV, B.P. Blg. 129). Plaintiff Domingo C. Palomares may therefore
take whatever steps he considers appropriate for the implementation of the said Order without need of further
Orders or additional authority from this Court.
SO ORDERED. 2
The petitioners filed a notice of appeal; the respondent court, however, denied it" 3 "it being directed against .
. . an interlocutory order. . . 4
Hence, this recourse.
The petitioners interpose the following questions:
A. Whether or not respondent Court can validly decide before trial in favor of private respondent the
ownership and possession of the 25,743,514 square meters (of) land known as "Hacienda de Maricaban",
which is the main issue in this case;
B. Whether or not respondent Court can validly allow private respondent to exercise and perform all acts of
ownership and possession over the said land before trial
C. Whether or not respondent Court has acquired jurisdiction to hear and decide this action;
D. Whether of not respondent Court committed grave abuse of discretion amounting to lack of jurisdiction in
not dismissing this action or allowing petitioners to appeal from the orders in question. 5
In their comment, the private respondent averred, among other things, that: (1) the respondent court,
contrary to the petitioners' claim, did not decide the case "before trial"; (2) OCT No. 291 had not been validly
cancelled and that the rubber stamp impression thereon, "CANCELLED" is a forgery; (3) the act of Judge
Pineda, in denying issuance of OCT No. 291, duplicate owner's copy, can not be considered res judicata
because that case involved purportedly a mere petition for issuance of duplicate owner's copy; (4) non-joinder
of proper parties is not a jurisdictional defect; (5) the TCTs issued thereafter are a nullity because OCT No.
291 had not been shown to have been duly cancelled; (6) OCT No. 291 has become imprescriptible; and (7)
the private respondent has a valid right of dominion over the property.
In the meantime, the private respondent came to this Court on certiorari (G.R. No. 90176) alleging that on
December 15, 1987, in connection with Sp. Proc. No. P-2993 of the Regional Trial Court, Branch 118, Pasay
City, entitled "In the matter of the Intestate Estate of the Late Fortunato Santiago and Mariano Pantanilla
Crisanta P. Santiago, et al., Petitioners," Judge Conrado Vasquez, Jr. issued an order disposing of certain
parcels which the private respondent claims as forming part and parcel of Hacienda de Maricaban.
On June 20, 1988, the respondent judge in G.R. No. 81564 filed his own comment, asserting, among other
things, that: (1) what he had sought to bar, by virtue of injunction, was incursions and forcible entries of
trespassers and squatters; (2) the petitioners can not rightly claim that he had prematurely adjudicated the
case, because there was allegedly no decision to begin with; (3) that he issued the writ of preliminary
injunction in order only to maintain the status quo ante bellum that is, to re-place the private respondent,
which had been allegedly in prior possession, in possession; (4) he did not allegedly authorize unbridled "acts
of ownership" to be exercised on the property; (5) all rights of dominion given thereon were subject to the
approval of the intestate estate court; (6) he denied the notice of appeal because the order dated October 12,
1987, was interlocutory in nature from which no appeal lies; (7) as to jurisdiction, the various motions filed by
petitioners, allegedly accepting the court's jurisdiction, have clothed the court with jurisdiction, and that
besides, the jurisdictional question was never raised except now.
On July 7, 1988, the petitioners filed a reply traversing the respondent judge's allegations.
On August 26, 1988, the respondent judge filed a supplemental comment. He reiterated that the writ of
injunction was directed only on such spaces not occupied by the Government (Fort Bonifacio, Libingan ng mga
Bayani, Ninoy Aquino International Airport, Nayong Pilipino, Population Commission, National Science and
Development Board, and National Housing Authority).
Meanwhile, Atty. Antonio J. Dalangpan for and on behalf purportedly of the "Heirs of Delfin Casal" and the
private respondent, Domingo Palomares, file a Comment/Opposition in Intervention", dated December 23,
1988 asking for the outright dismissal of the petition.
On December 14, 1989, the private respondent filed a manifestation, stating, among other things, that
assuming OCT No. 291 had been cancelled, there was still basis for the respondent judge to prevent
landgrabbers from entering into vacant portions of the state embraced thereby.
The Court finds the issues, quintessentially, to be:
(1) Is OCT No. 291 still valid and subsisting?
(2) Did the respondent judge, in issuing the orders, dated October 12 and October 23, 1987, commit a grave
abuse of discretion equivalent to lack or excess of jurisdiction?
I.
Is OCT No. 291 still valid and subsisting?
The Court takes judicial notice of the fact that the hectarage embraced by TCT No. 192 (OCT No. 291)
consists of Government property. Three things persuade the Court: (1) the decrees of Proclamations Nos. 192
and 435; (2) the incontrovertible fact that OCT No. 291 has been duly cancelled; and (3) the division of the
Court of Appeals in AC-G.R. CV No. 00293, affirming the decision of Hon. Gregorio Pineda, Judge of the then
Court of First Instance of Rizal, Branch XXI, in LRC (GLRO) Rec. No. 2484, Case No. R-1467 thereof, entitled
"In Re: Issuance of Owner's Duplicate of Certificate of Title No. 291," as well as our own Resolution, in G.R.
No. 69834, entitled "Domingo Palomares, et al., v. Intermediate Appellate Court".
(a)
Proclamation No. 192 ("RESERVING FOR THE VETERANS CENTER SITE PURPOSES CERTAIN PARCEL OF LAND
OF THE PUBLIC DOMAIN SITUATED IN THE PROVINCE OF RIZAL, ISLAND OF LUZON") and Proclamation No.
423 ("RESERVING FOR MILITARY PURPOSES CERTAIN PARCELS OF THE PUBLIC DOMAIN SITUATED IN THE
MUNICIPALITY OF PASIG, TAGUIG, AND PARAÑAQUE PROVINCE OF RIZAL, AND PASAY CITY") have the
character of official assertions of ownership, and the presumption is that they have been issued by right of
sovereignty and in the exercise of the State's dominical authority. We take not only judicial notice thereof 6
but accept the same as a valid asseveration of regalian light over property.
With respect to the premises occupied by the Libingan ng mga Bayani, Ninoy Aquino International Airport,
Nayong Pilipino, the Population Commission, National Science and Development Board, and the National
Housing Authority, we do not have the slightest doubt that they stand on Government property by sheer
presumption that, unless otherwise shown, what the Government occupies is what the Government owns.
While there is no presumption that property is Government property until otherwise shown, because the law
recognizes private ownership, thus:
Art. 425. Property of private ownership, besides the patrimonial property of the State, provinces, cities, and
municipalities, consists of all property belonging to private persons, either individually or collectively. 7
we find hard evidence on record that: (1) the property covered by OCT No. 291 had been conveyed to the
United States of America; (2) it had been later ceded to the Republic of the Philippines, and (3) as a
consequence, OCT No. 291 was cancelled upon final order of Judge Ostrand.
Be that as it may, the private respondent in G.R. No. 81564 is pressed hard to establish the fact that portions
of the property, especially the open spaces referred to in the lower court's writ of injunction and the private
respondent's manifestation of December 14, 1989, and which open spaces it claims to be outside Maricaban,
are indeed outside Maricaban (or OCT 291). With respect, however, to parts thereof on which Fort Bonifacio,
Libingan ng mga Bayani, Ninoy Aquino International Airport, Nayong Pilipino, Population Commission National
Science and Development Board, and National Housing Authority sit, the hands of the private respondent are
tied.
Claims that Judge Ostrand's decree was a counterfeit is not only self-serving, it finds no support from the
records. The presumptions is "that official duty has been regularly performed," 8 and the burden is on the
private respondent to prove irregular performance. The barren insistence that Judge Ostrands order was a
forgery is not sufficient to overthrow the presumption. To begin with, the act of forgery has been seasonably
disputed by the petitioners. Secondly, the Acting Registrar of Deeds of Pasig, who supposedly certified to the
fake character of Judge Ostrand's order, has himself joined the other petitioners in opposing the reconveyance
sought.
(b)
The decision in AC-G.R. No. 00293, dismissing the private respondent's petition for the issuance of a new
owner's copy of OCT No. 291, a dismissal affirmed by this Court in G.R. No. 69834, also militates against the
return of the property to the heirs of Delfin Casal. The Appellate Court's judgment, a judgment sustained by
this Court, operates as, at the very least, the law of the case between the parties, that OCT No. 291 has been
cancelled and the land covered has been conveyed and ceded to the National Government. The fact that AC-
G.R. CV No. 00293 dealt with a petition for issuance of lost owner's duplicate copy is no argument because be
that as it may, the private respondent can not rightfully say that the heirs of Delfin Casal still have title to the
land. If it can not secure a new owner's copy, it can mean that they have lost title thereto.
(c)
The principle of res judicata is also a bar to the instant proceedings. It should be noted that in G.R. No. 69834,
Mr. Domingo Palomares prayed:
WHEREFORE, premises considered it is most respectfully prayed to the most Honorable Supreme Court, that in
the name of law, justice and fair play, to prevent and frustrate "land-grabbing" by the government, decision be
rendered:
FIRST, That a thorough review of the aforementioned resolution of the Intermediate Appellate Court be made;
SECOND, That after due consideration, the resolution subject of review be set aside based on the aforestated
assignment of error;
THIRD, That the Order of the Lower Court dated Jan. 19, 1977 be affirmed as the lawful and valid order;
FOURTH, To erase all doubts by declaring OCT No. 291 as continuously and existing validly against the whole
world;
FIFTH, Clearing OCT No. 291 of all adverse claims, since the herein petitioners are the true and legally
declared heirs; and
SIXTH, Ordering the Register of Deeds of Pasig, Rizal to issue the Owner's Duplicate Copy of OCT No. 291.
Petitioner-Appellant further prays for other just and equitable reliefs.****
When we therefore denied that petition, we, in effect, held that reconstitution (of lost duplicate owner's copy)
was not possible because the mother title (OCT No. 291) had been duly cancelled. And when we therefore
declared OCT No. 291 to have been cancelled, we perished all doubts as to the invalidity of Mr. Palomares'
pretenses of title to Maricaban. Our judgment was conclusive not only as to Mr. Palomares, but also as to the
existing status of the property. As we have held:
The lower Court correctly ruled that the present action is barred by the final judgment rendered in the
previous case of Tuason & Co. vs. Aguila, Civil Case No. Q-4275, of the Court of First Instance of Rizal. The
reason is plain: if the herein appellants really had a preferential right to a conveyance of the land from J.M.
Tuason & Co., or if the certificate of (Torrens) title held by Tuason & Co. were truly void and ineffective, then
these facts should have been pleaded by these appellants in the previous case (Q-4275), since such facts, if
true, constituted a defense to the claim of Tuason & Co. for recovery of possession. If appellants failed to
plead such defenses in that previous case, they are barred from litigating the same in any subsequent
proceeding, for it is a well established rule that as between the same parties and on the same subject and
cause of action, a final judgment is conclusive not only on matters directly adjudicated, but also as to any
other matter that could have been raised in relation thereto. 9
II
Did the respondent judge, in issuing the order, dated October 12, 1987, commit a grave abuse of discretion
equivalent to lack of excess of jurisdiction?
(a)
The Court has no doubt that Judge Velez is here guilty of grave abuse of discretion tantamount to lack or
excess of jurisdiction to warrant certiorari. As above-stated, what he gave away, by virtue of reconveyance,
was property that inalienably belongs to the Government or its successors. Worse, he gave away property
without notice to the actual possessors, that is, the present registered owner. It is beyond debate, as we have
indicated, that the land had been, since the cancellation of OCT No. 291, parcelled out to a succession of
buyers and owners. In the absence of notice, it acquired no jurisdiction to decree redelivery or reconveyance.
It is well-established that owners of property over which reconveyance is asserted are indispensable parties,
without whom no relief is available and without whom the court can render no valid judgment. 10
Furthermore, the present holders of the land in question are innocent purchasers for value, or presumed to be
so in the absence of contrary evidence, against whom reconveyance does not lie. 11
(b)
The respondent judge can not conceal his faults behind arguments that he did not intend to convey the
premises, but rather, to secure, allegedly, vacant portions thereof from interlopers. First, this is not stated in
his order. Second, that order is clear and unequivocal that Domingo Palomares has the right "[t]o sell,
exchange, lease or otherwise dispose of any area or areas or portion or portions thereof . . . " 12 Third and
last, the security of the property is the lookout of the claimants, and not the court's. In case the premises the
respondent judge's injunctive writ have been directed belong to others, let them air their plaints.
(c)
The Court is also agreed that the challenged order was issued with no benefit of trial or hearing. The private
respondent can not validly rely on AC-G.R. No. 00293 as the "trial or hearing" to justify the issuance of its said
order, in the first place, because it is a different proceeding. But above all, the private respondent itself says
that AC-G.R. CV No. 00293 can not be made a basis for denying reconveyance because "the . . . petition was
merely for the issuance of a new owner's duplicate copy . . . 13 Accordingly, it can not invoke that case and
yet, repudiate its effects. It is the height of contradiction.
(d)
It was also grave error for the lower court to deny the Solicitor General's notice of appeal. The Government
had all the right to appeal because: (1) the order of October 12, 1987 was in the nature of a final judgment,
as "final judgment" is known in law (however it is captioned), that is to say, one that "finally disposes of the
pending action so that nothing more can be done with it in the trial court; 14 (2) it did not merely maintain the
status quo, but allowed Mr. Domingo Palomares to transact on the property by near right of dominion over it.
Judge Velez had therefore no reason, indeed, excuse, to deny the Government's notice of appeal. What is
plain is the fact that Judge Velez was hell-bent, so to speak, in blocking the Government's efforts to defend
what rightfully belongs to it.
What has obviously been lost on the parties, Judge Velez in particular, is the established principle that
injunction does not lie "to take property out of the possession or control of one party and place it into that of
another." 15 In this wise it has also been held:
xxx xxx xxx
It is a well established doctrine in this jurisdiction that an injunction is not the proper remedy for the recovery
of possession of real estate and the improvements thereon, as well as for the ejectments therefrom of the
actual occupants who claim to have title to or material interest therein. The use of said remedy in such cases
has invariably been considered unjustified, in open violation of the legal presumption that the bona fide
possessor of a certain piece of land and improvements thereon, holds the same under claim of ownership and
with a just title, and as an advanced concession of the remedy to which the claimant might be entitled.
(Citations omitted) 16
xxx xxx xxx
Injunction, moreover, is an extraordinary remedy. It lies only in certain cases, to wit:
Sec. 3. Grounds for issuance of preliminary injunction. - A preliminary injunction may be granted at any time
after the commencement of the action and before judgment when it is established:
(a) That the plaintiff is entitled to the relief demanded, and the whole or part of such relief consists in
restraining the commission or continuance of the acts complained of, or in the performance of an act or acts,
either for a limited period or perpetually;
(b) That the commission or continuance of some act complained of during the litigation or the non-
performance thereof would probably work injustice to the plaintiff; or
(c) That the defendant is doing, threatens, or is about to do, or is procuring or suffering to be done, some act
probably in violation of the plaintiffs rights respecting the subject of the action, and tending to render the
judgment ineffectual. 17
xxx xxx xxx
The conspicuous and unusual zeal with which Judge Francisco Velez now defends his acts 18 has not escaped
us. His Honor should have borne in mind that in proceedings under Rule 65 of the Rules, such as the present
cases, the judge is included only as a nominal party. Unless otherwise ordained by this Court, he is not called
upon to answer or comment on the petition, but rather, the private respondent. It is indeed distressing to note
that it is the very judge who has taken the cudgels for the latter, in defending its interests, when he, the
judge, should have remained a neutral magistrate. Res ipsa loquitor. 19 He must get his just deserts.
III
The Court thus closes the long-drawn tale of Hacienda de Maricaban. In this connection, let trial judges be
cautioned on the indiscriminate disposition of our dwindling natural resources to private persons. Accordingly,
we grant G.R. No. 81564 and dismiss G.R. No. 90176, and so also, end what has come down as nearly a
century of uncertainty, doubt, and conflict Maricaban has left in its trail. The Court has finally spoken. Let the
matter rest.
WHEREFORE:
1. The petition in G.R. No. 81564 is GRANTED:
(a) The Writ of Preliminary Injunction issued by our Resolution, dated April 13, 1988, enjoining the respondent
judge from enforcing his: (i) order of October 12, 1987 and (ii) the follow-up order of October 23, 1987, is
made permanent and
(b) Original Certificate of Title No. 291 is declared duly CANCELLED;
2. The petition in G.R. No. 90176 is DISMISSED; and
3. Judge Francisco Velez is ordered to SHOW CAUSE why he should not be administratively dealt with for
giving away, by virtue of reconveyance, property that inalienably belongs to the Government, without notice to
the registered owner, and without benefit of trial or hearing; for blocking Government efforts to defend what
rightfully belongs to it; and for filing his comment of June 17, 1988 and supplemental comment of August 26,
1988 without express leave of court.
Costs against the private respondent.
SO ORDERED.