G.R. No.
92013 July 25, 1990 indemnification to the Filipino people for their losses in life and property and
SALVADOR H. LAUREL, petitioner,
vs.
RAMON GARCIA, as head of the Asset Privatization Trust, RAUL
MANGLAPUS, as Secretary of Foreign Affairs, and CATALINO MACARAIG, as
Executive Secretary, respondents.
G.R. No. 92047 July 25, 1990
DIONISIO S. OJEDA, petitioner,
vs.
EXECUTIVE SECRETARY MACARAIG, JR., ASSETS PRIVATIZATION TRUST
CHAIRMAN RAMON T. GARCIA, AMBASSADOR RAMON DEL ROSARIO, et
al., as members of the PRINCIPAL AND BIDDING COMMITTEES ON THE
UTILIZATION/DISPOSITION PETITION OF PHILIPPINE GOVERNMENT
PROPERTIES IN JAPAN, respondents.
Arturo M. Tolentino for petitioner in 92013.
GUTIERREZ, JR., J.:
These are two petitions for prohibition seeking to enjoin respondents, their
representatives and agents from proceeding with the bidding for the sale of
the 3,179 square meters of land at 306 Roppongi, 5-Chome Minato-ku Tokyo,
Japan scheduled on February 21, 1990. We granted the prayer for a
temporary restraining order effective February 20, 1990. One of the
petitioners (in G.R. No. 92047) likewise prayes for a writ of mandamus to
compel the respondents to fully disclose to the public the basis of their
decision to push through with the sale of the Roppongi property inspire of
strong public opposition and to explain the proceedings which effectively
prevent the participation of Filipino citizens and entities in the bidding
process.
The oral arguments in G.R. No. 92013, Laurel v. Garcia, et al. were heard by
the Court on March 13, 1990. After G.R. No. 92047, Ojeda v. Secretary
Macaraig, et al. was filed, the respondents were required to file a comment
by the Court's resolution dated February 22, 1990. The two petitions were
consolidated on March 27, 1990 when the memoranda of the parties in
the Laurel case were deliberated upon.
The Court could not act on these cases immediately because the respondents
filed a motion for an extension of thirty (30) days to file comment in G.R. No.
92047, followed by a second motion for an extension of another thirty (30)
days which we granted on May 8, 1990, a third motion for extension of time
granted on May 24, 1990 and a fourth motion for extension of time which we
granted on June 5, 1990 but calling the attention of the respondents to the
length of time the petitions have been pending. After the comment was filed,
the petitioner in G.R. No. 92047 asked for thirty (30) days to file a reply. We
noted his motion and resolved to decide the two (2) cases.
I reparations properties starting with the Roppongi lot. The property has twice
The subject property in this case is one of the four (4) properties in Japan
acquired by the Philippine government under the Reparations Agreement
entered into with Japan on May 9, 1956, the other lots being:
(1) The Nampeidai Property at 11-24 Nampeidai-machi, Shibuya-ku, Tokyo
which has an area of approximately 2,489.96 square meters, and is at
present the site of the Philippine Embassy Chancery;
(2) The Kobe Commercial Property at 63 Naniwa-cho, Kobe, with an area of
around 764.72 square meters and categorized as a commercial lot now being
used as a warehouse and parking lot for the consulate staff; and
(3) The Kobe Residential Property at 1-980-2 Obanoyama-cho, Shinohara,
Nada-ku, Kobe, a residential lot which is now vacant.
The properties and the capital goods and services procured from the
Japanese government for national development projects are part of the
their suffering during World War II.
The Reparations Agreement provides that reparations valued at $550 million
would be payable in twenty (20) years in accordance with annual schedules
of procurements to be fixed by the Philippine and Japanese governments
(Article 2, Reparations Agreement). Rep. Act No. 1789, the Reparations Law,
prescribes the national policy on procurement and utilization of reparations
and development loans. The procurements are divided into those for use by
the government sector and those for private parties in projects as the then
National Economic Council shall determine. Those intended for the private
sector shall be made available by sale to Filipino citizens or to one hundred
(100%) percent Filipino-owned entities in national development projects.
The Roppongi property was acquired from the Japanese government under
the Second Year Schedule and listed under the heading "Government
Sector", through Reparations Contract No. 300 dated June 27, 1958. The
Roppongi property consists of the land and building "for the Chancery of the
Philippine Embassy" (Annex M-D to Memorandum for Petitioner, p. 503). As
intended, it became the site of the Philippine Embassy until the latter was
transferred to Nampeidai on July 22, 1976 when the Roppongi building
needed major repairs. Due to the failure of our government to provide
necessary funds, the Roppongi property has remained undeveloped since
that time.
A proposal was presented to President Corazon C. Aquino by former
Philippine Ambassador to Japan, Carlos J. Valdez, to make the property the
subject of a lease agreement with a Japanese firm - Kajima Corporation —
which shall construct two (2) buildings in Roppongi and one (1) building in
Nampeidai and renovate the present Philippine Chancery in Nampeidai. The
consideration of the construction would be the lease to the foreign
corporation of one (1) of the buildings to be constructed in Roppongi and the
two (2) buildings in Nampeidai. The other building in Roppongi shall then be
used as the Philippine Embassy Chancery. At the end of the lease period, all
the three leased buildings shall be occupied and used by the Philippine
government. No change of ownership or title shall occur. (See Annex "B" to
Reply to Comment) The Philippine government retains the title all
throughout the lease period and thereafter. However, the government has
not acted favorably on this proposal which is pending approval and
ratification between the parties. Instead, on August 11, 1986, President
Aquino created a committee to study the disposition/utilization of Philippine
government properties in Tokyo and Kobe, Japan through Administrative
Order No. 3, followed by Administrative Orders Numbered 3-A, B, C and D.
On July 25, 1987, the President issued Executive Order No. 296 entitling non-
Filipino citizens or entities to avail of separations' capital goods and services
in the event of sale, lease or disposition. The four properties in Japan
including the Roppongi were specifically mentioned in the first "Whereas"
clause.
Amidst opposition by various sectors, the Executive branch of the
government has been pushing, with great vigor, its decision to sell the
been set for bidding at a minimum floor price of $225 million. The first
bidding was a failure since only one bidder qualified. The second one, after
postponements, has not yet materialized. The last scheduled bidding on
February 21, 1990 was restrained by his Court. Later, the rules on bidding
were changed such that the $225 million floor price became merely a
suggested floor price.
The Court finds that each of the herein petitions raises distinct issues. The
petitioner in G.R. No. 92013 objects to the alienation of the Roppongi
property to anyone while the petitioner in G.R. No. 92047 adds as a principal
objection the alleged unjustified bias of the Philippine government in favor of
selling the property to non-Filipino citizens and entities. These petitions have
been consolidated and are resolved at the same time for the objective is the
same - to stop the sale of the Roppongi property.
The petitioner in G.R. No. 92013 raises the following issues:
(1) Can the Roppongi property and others of its kind be alienated by the
Philippine Government?; and
(2) Does the Chief Executive, her officers and agents, have the authority and
jurisdiction, to sell the Roppongi property?
Petitioner Dionisio Ojeda in G.R. No. 92047, apart from questioning the
authority of the government to alienate the Roppongi property assails the
constitutionality of Executive Order No. 296 in making the property available
for sale to non-Filipino citizens and entities. He also questions the bidding
procedures of the Committee on the Utilization or Disposition of Philippine
Government Properties in Japan for being discriminatory against Filipino
citizens and Filipino-owned entities by denying them the right to be informed
about the bidding requirements.
II
In G.R. No. 92013, petitioner Laurel asserts that the Roppongi property and
the related lots were acquired as part of the reparations from the Japanese
government for diplomatic and consular use by the Philippine government.
Vice-President Laurel states that the Roppongi property is classified as one of
public dominion, and not of private ownership under Article 420 of the Civil
Code (See infra).
The petitioner submits that the Roppongi property comes under "property
intended for public service" in paragraph 2 of the above provision. He states
that being one of public dominion, no ownership by any one can attach to it,
not even by the State. The Roppongi and related properties were acquired
for "sites for chancery, diplomatic, and consular quarters, buildings and other
improvements" (Second Year Reparations Schedule). The petitioner states
that they continue to be intended for a necessary service. They are held by
the State in anticipation of an opportune use. (Citing 3 Manresa 65-66).
Hence, it cannot be appropriated, is outside the commerce of man, or to put
it in more simple terms, it cannot be alienated nor be the subject matter of
contracts (Citing Municipality of Cavite v. Rojas, 30 Phil. 20 [1915]). Noting
the non-use of the Roppongi property at the moment, the petitioner avers
that the same remains property of public dominion so long as the
government has not used it for other purposes nor adopted any measure
constituting a removal of its original purpose or use.
The respondents, for their part, refute the petitioner's contention by saying
that the subject property is not governed by our Civil Code but by the laws of
Japan where the property is located. They rely upon the rule of lex
situs which is used in determining the applicable law regarding the
acquisition, transfer and devolution of the title to a property. They also
invoke Opinion No. 21, Series of 1988, dated January 27, 1988 of the
Secretary of Justice which used the lex situs in explaining the inapplicability
of Philippine law regarding a property situated in Japan.
The respondents add that even assuming for the sake of argument that the
Civil Code is applicable, the Roppongi property has ceased to become
property of public dominion. It has become patrimonial property because it
has not been used for public service or for diplomatic purposes for over
thirteen (13) years now (Citing Article 422, Civil Code) and because
the intention by the Executive Department and the Congress to convert it to
private use has been manifested by overt acts, such as, among others: (1) the
transfer of the Philippine Embassy to Nampeidai (2) the issuance of
administrative orders for the possibility of alienating the four government
properties in Japan; (3) the issuance of Executive Order No. 296; (4) the
enactment by the Congress of Rep. Act No. 6657 [the Comprehensive
Agrarian Reform Law] on June 10, 1988 which contains a provision stating
that funds may be taken from the sale of Philippine properties in foreign
countries; (5) the holding of the public bidding of the Roppongi property but
which failed; (6) the deferment by the Senate in Resolution No. 55 of the
bidding to a future date; thus an acknowledgment by the Senate of the
government's intention to remove the Roppongi property from the public
service purpose; and (7) the resolution of this Court dismissing the petition
in Ojeda v. Bidding Committee, et al., G.R. No. 87478 which sought to enjoin
the second bidding of the Roppongi property scheduled on March 30, 1989.
III
In G.R. No. 94047, petitioner Ojeda once more asks this Court to rule on the
constitutionality of Executive Order No. 296. He had earlier filed a petition in
G.R. No. 87478 which the Court dismissed on August 1, 1989. He now avers
that the executive order contravenes the constitutional mandate to conserve
and develop the national patrimony stated in the Preamble of the 1987
Constitution. It also allegedly violates:
(1) The reservation of the ownership and acquisition of alienable lands of the
public domain to Filipino citizens. (Sections 2 and 3, Article XII, Constitution;
Sections 22 and 23 of Commonwealth Act 141).i•t•c-aüsl
(2) The preference for Filipino citizens in the grant of rights, privileges and
concessions covering the national economy and patrimony (Section 10,
Article VI, Constitution);
(3) The protection given to Filipino enterprises against unfair competition
and trade practices;
(4) The guarantee of the right of the people to information on all matters of
public concern (Section 7, Article III, Constitution);
(5) The prohibition against the sale to non-Filipino citizens or entities not
wholly owned by Filipino citizens of capital goods received by the Philippines
under the Reparations Act (Sections 2 and 12 of Rep. Act No. 1789); and
(6) The declaration of the state policy of full public disclosure of all
transactions involving public interest (Section 28, Article III, Constitution).
Petitioner Ojeda warns that the use of public funds in the execution of an
unconstitutional executive order is a misapplication of public funds He states
that since the details of the bidding for the Roppongi property were never
publicly disclosed until February 15, 1990 (or a few days before the
scheduled bidding), the bidding guidelines are available only in Tokyo, and
the accomplishment of requirements and the selection of qualified bidders
should be done in Tokyo, interested Filipino citizens or entities owned by
them did not have the chance to comply with Purchase Offer Requirements
on the Roppongi. Worse, the Roppongi shall be sold for a minimum price of
$225 million from which price capital gains tax under Japanese law of about
50 to 70% of the floor price would still be deducted.
IV
The petitioners and respondents in both cases do not dispute the fact that
the Roppongi site and the three related properties were through reparations
agreements, that these were assigned to the government sector and that the
Roppongi property itself was specifically designated under the Reparations
Agreement to house the Philippine Embassy.
The nature of the Roppongi lot as property for public service is expressly
spelled out. It is dictated by the terms of the Reparations Agreement and the
corresponding contract of procurement which bind both the Philippine
government and the Japanese government.
There can be no doubt that it is of public dominion unless it is convincingly
shown that the property has become patrimonial. This, the respondents have
failed to do.
As property of public dominion, the Roppongi lot is outside the commerce of
man. It cannot be alienated. Its ownership is a special collective ownership
for general use and enjoyment, an application to the satisfaction of collective
needs, and resides in the social group. The purpose is not to serve the State
as a juridical person, but the citizens; it is intended for the common and
public welfare and cannot be the object of appropration. (Taken from 3
Manresa, 66-69; cited in Tolentino, Commentaries on the Civil Code of the
Philippines, 1963 Edition, Vol. II, p. 26).
The applicable provisions of the Civil Code are:
ART. 419. Property is either of public dominion or of private ownership.
ART. 420. The following things are property of public dominion
(1) Those intended for public use, such as roads, canals, rivers, torrents, ports
and bridges constructed by the State, banks shores roadsteads, and others of
similar character;
(2) Those which belong to the State, without being for public use, and are
intended for some public service or for the development of the national
wealth.
ART. 421. All other property of the State, which is not of the character stated
in the preceding article, is patrimonial property.
The Roppongi property is correctly classified under paragraph 2 of Article 420
of the Civil Code as property belonging to the State and intended for some
public service.
Has the intention of the government regarding the use of the property been
changed because the lot has been Idle for some years? Has it become
patrimonial?
The fact that the Roppongi site has not been used for a long time for actual
Embassy service does not automatically convert it to patrimonial property.
Any such conversion happens only if the property is withdrawn from public
use (Cebu Oxygen and Acetylene Co. v. Bercilles, 66 SCRA 481 [1975]). A
property continues to be part of the public domain, not available for private
appropriation or ownership until there is a formal declaration on the part of
the government to withdraw it from being such (Ignacio v. Director of Lands,
108 Phil. 335 [1960]).
The respondents enumerate various pronouncements by concerned public
officials insinuating a change of intention. We emphasize, however, that an
abandonment of the intention to use the Roppongi property for public
service and to make it patrimonial property under Article 422 of the Civil
Code must be definite Abandonment cannot be inferred from the non-use
alone specially if the non-use was attributable not to the government's own
deliberate and indubitable will but to a lack of financial support to repair and
improve the property (See Heirs of Felino Santiago v. Lazaro, 166 SCRA 368
[1988]). Abandonment must be a certain and positive act based on correct
legal premises.
A mere transfer of the Philippine Embassy to Nampeidai in 1976 is not
relinquishment of the Roppongi property's original purpose. Even the failure
by the government to repair the building in Roppongi is not abandonment
since as earlier stated, there simply was a shortage of government funds. The
recent Administrative Orders authorizing a study of the status and conditions
of government properties in Japan were merely directives for investigation
but did not in any way signify a clear intention to dispose of the properties.
Executive Order No. 296, though its title declares an "authority to sell", does
not have a provision in its text expressly authorizing the sale of the four
properties procured from Japan for the government sector. The executive
order does not declare that the properties lost their public character. It
merely intends to make the properties available to foreigners and not to
Filipinos alone in case of a sale, lease or other disposition. It merely
eliminates the restriction under Rep. Act No. 1789 that reparations goods
may be sold only to Filipino citizens and one hundred (100%) percent
Filipino-owned entities. The text of Executive Order No. 296 provides:
Section 1. The provisions of Republic Act No. 1789, as amended, and of other
laws to the contrary notwithstanding, the above-mentioned properties can
be made available for sale, lease or any other manner of disposition to non-
Filipino citizens or to entities owned by non-Filipino citizens.
Executive Order No. 296 is based on the wrong premise or assumption that
the Roppongi and the three other properties were earlier converted into
alienable real properties. As earlier stated, Rep. Act No. 1789 differentiates
the procurements for the government sector and the private sector (Sections
2 and 12, Rep. Act No. 1789). Only the private sector properties can be sold
to end-users who must be Filipinos or entities owned by Filipinos. It is this
nationality provision which was amended by Executive Order No. 296.
Section 63 (c) of Rep. Act No. 6657 (the CARP Law) which provides as one of
the sources of funds for its implementation, the proceeds of the disposition
of the properties of the Government in foreign countries, did not withdraw
the Roppongi property from being classified as one of public dominion when
it mentions Philippine properties abroad. Section 63 (c) refers to properties
which are alienable and not to those reserved for public use or service. Rep
Act No. 6657, therefore, does not authorize the Executive Department to sell
the Roppongi property. It merely enumerates possible sources of future
funding to augment (as and when needed) the Agrarian Reform Fund created
under Executive Order No. 299. Obviously any property outside of the
commerce of man cannot be tapped as a source of funds.
The respondents try to get around the public dominion character of the
Roppongi property by insisting that Japanese law and not our Civil Code
should apply.
It is exceedingly strange why our top government officials, of all people,
should be the ones to insist that in the sale of extremely valuable
government property, Japanese law and not Philippine law should prevail.
The Japanese law - its coverage and effects, when enacted, and exceptions to
its provision — is not presented to the Court It is simply asserted that the lex
loci rei sitae or Japanese law should apply without stating what that law
provides. It is a ed on faith that Japanese law would allow the sale.
We see no reason why a conflict of law rule should apply when no conflict of
law situation exists. A conflict of law situation arises only when: (1) There is a
dispute over the title or ownership of an immovable, such that the capacity
to take and transfer immovables, the formalities of conveyance, the essential
validity and effect of the transfer, or the interpretation and effect of a
conveyance, are to be determined (See Salonga, Private International Law,
1981 ed., pp. 377-383); and (2) A foreign law on land ownership and its
conveyance is asserted to conflict with a domestic law on the same matters.
Hence, the need to determine which law should apply.
In the instant case, none of the above elements exists.
The issues are not concerned with validity of ownership or title. There is no
question that the property belongs to the Philippines. The issue is the
authority of the respondent officials to validly dispose of property belonging
to the State. And the validity of the procedures adopted to effect its sale.
This is governed by Philippine Law. The rule of lex situs does not apply.
The assertion that the opinion of the Secretary of Justice sheds light on the
relevance of the lex situs rule is misplaced. The opinion does not tackle
the alienability of the real properties procured through reparations nor the
existence in what body of the authority to sell them. In discussing who are
capable of acquiring the lots, the Secretary merely explains that it is the
foreign law which should determine who can acquire the properties so that
the constitutional limitation on acquisition of lands of the public domain to
Filipino citizens and entities wholly owned by Filipinos is inapplicable. We see
no point in belaboring whether or not this opinion is correct. Why should we
discuss who can acquire the Roppongi lot when there is no showing that it
can be sold?
The subsequent approval on October 4, 1988 by President Aquino of the
recommendation by the investigating committee to sell the Roppongi
property was premature or, at the very least, conditioned on a valid change
in the public character of the Roppongi property. Moreover, the approval
does not have the force and effect of law since the President already lost her
legislative powers. The Congress had already convened for more than a year.
Assuming for the sake of argument, however, that the Roppongi property is
no longer of public dominion, there is another obstacle to its sale by the
respondents.
There is no law authorizing its conveyance.
Section 79 (f) of the Revised Administrative Code of 1917 provides
Section 79 (f ) Conveyances and contracts to which the Government is a
party. — In cases in which the Government of the Republic of the Philippines
is a party to any deed or other instrument conveying the title to real estate
or to any other property the value of which is in excess of one hundred
thousand pesos, the respective Department Secretary shall prepare the
necessary papers which, together with the proper recommendations, shall
be submitted to the Congress of the Philippines for approval by the
same. Such deed, instrument, or contract shall be executed and signed by
the President of the Philippines on behalf of the Government of the
Philippines unless the Government of the Philippines unless the authority
therefor be expressly vested by law in another officer. (Emphasis supplied)
The requirement has been retained in Section 48, Book I of the
Administrative Code of 1987 (Executive Order No. 292).
SEC. 48. Official Authorized to Convey Real Property. — Whenever real
property of the Government is authorized by law to be conveyed, the deed of
conveyance shall be executed in behalf of the government by the following:
(1) For property belonging to and titled in the name of the Republic of the
Philippines, by the President, unless the authority therefor is expressly
vested by law in another officer.
other ground such as the application of a statute or general law (Siler v.
Louisville and Nashville R. Co., 213 U.S. 175, [1909], Railroad Commission v.
Pullman Co., 312 U.S. 496 [1941]).
The petitioner in G.R. No. 92013 states why the Roppongi property should
not be sold:
The Roppongi property is not just like any piece of property. It was given to
the Filipino people in reparation for the lives and blood of Filipinos who died
and suffered during the Japanese military occupation, for the suffering of
widows and orphans who lost their loved ones and kindred, for the homes
and other properties lost by countless Filipinos during the war. The Tokyo
properties are a monument to the bravery and sacrifice of the Filipino people
in the face of an invader; like the monuments of Rizal, Quezon, and other
Filipino heroes, we do not expect economic or financial benefits from them.
But who would think of selling these monuments? Filipino honor and
national dignity dictate that we keep our properties in Japan as memorials to
the countless Filipinos who died and suffered. Even if we should become
paupers we should not think of selling them. For it would be as if we sold the
lives and blood and tears of our countrymen. (Rollo- G.R. No. 92013, p.147)

(2) For property belonging to the Republic of the Philippines but titled in the
name of any political subdivision or of any corporate agency or
instrumentality, by the executive head of the agency or instrumentality.
(Emphasis supplied)
It is not for the President to convey valuable real property of the government
on his or her own sole will. Any such conveyance must be authorized and
approved by a law enacted by the Congress. It requires executive and
legislative concurrence.
Resolution No. 55 of the Senate dated June 8, 1989, asking for the deferment
of the sale of the Roppongi property does not withdraw the property from
public domain much less authorize its sale. It is a mere resolution; it is not a
formal declaration abandoning the public character of the Roppongi
property. In fact, the Senate Committee on Foreign Relations is conducting
hearings on Senate Resolution No. 734 which raises serious policy
considerations and calls for a fact-finding investigation of the circumstances
behind the decision to sell the Philippine government properties in Japan.
The resolution of this Court in Ojeda v. Bidding Committee, et al., supra, did
not pass upon the constitutionality of Executive Order No. 296. Contrary to
respondents' assertion, we did not uphold the authority of the President to
sell the Roppongi property. The Court stated that the constitutionality of the
executive order was not the real issue and that resolving the constitutional
question was "neither necessary nor finally determinative of the case." The
Court noted that "[W]hat petitioner ultimately questions is the use of the
proceeds of the disposition of the Roppongi property." In emphasizing that
"the decision of the Executive to dispose of the Roppongi property to finance
the CARP ... cannot be questioned" in view of Section 63 (c) of Rep. Act No.
6657, the Court did not acknowledge the fact that the property became
alienable nor did it indicate that the President was authorized to dispose of
the Roppongi property. The resolution should be read to mean that in case
the Roppongi property is re-classified to be patrimonial and alienable by
authority of law, the proceeds of a sale may be used for national economic
development projects including the CARP.
The petitioner in G.R. No. 92047 also states:
Roppongi is no ordinary property. It is one ceded by the Japanese
government in atonement for its past belligerence for the valiant sacrifice of
life and limb and for deaths, physical dislocation and economic devastation
the whole Filipino people endured in World War II.
It is for what it stands for, and for what it could never bring back to life, that
its significance today remains undimmed, inspire of the lapse of 45 years
since the war ended, inspire of the passage of 32 years since the property
passed on to the Philippine government.
Roppongi is a reminder that cannot — should not — be dissipated ... (Rollo-
92047, p. 9)
It is indeed true that the Roppongi property is valuable not so much because
of the inflated prices fetched by real property in Tokyo but more so because
of its symbolic value to all Filipinos — veterans and civilians alike. Whether or
not the Roppongi and related properties will eventually be sold is a policy
determination where both the President and Congress must concur.
Considering the properties' importance and value, the laws on conversion
and disposition of property of public dominion must be faithfully followed.
WHEREFORE, IN VIEW OF THE FOREGOING, the petitions are GRANTED. A
writ of prohibition is issued enjoining the respondents from proceeding with
the sale of the Roppongi property in Tokyo, Japan. The February 20, 1990
Temporary Restraining Order is made PERMANENT.
SO ORDERED.

Moreover, the sale in 1989 did not materialize. The petitions before us
question the proposed 1990 sale of the Roppongi property. We are resolving
the issues raised in these petitions, not the issues raised in 1989.

Having declared a need for a law or formal declaration to withdraw the

Roppongi property from public domain to make it alienable and a need for
legislative authority to allow the sale of the property, we see no compelling
reason to tackle the constitutional issues raised by petitioner Ojeda.

The Court does not ordinarily pass upon constitutional questions unless these
questions are properly raised in appropriate cases and their resolution is
necessary for the determination of the case (People v. Vera, 65 Phil. 56
[1937]). The Court will not pass upon a constitutional question although
properly presented by the record if the case can be disposed of on some
G.R. No. 163767               March 10, 2014
REPUBLIC OF THE PHILIPPINES, represented by THE DIRECTOR OF
LANDS, Petitioner,
vs.
ROSARIO DE GUZMAN VDA. DE JOSON, Respondent.
DECISION
BERSAMIN, J.:
This case concerns the discharge of the burden of proof by the applicant in
proceedings for the registration of land under Section 14 (1) and (2) of
Presidential Decree No. 1529 (Property Registration Decree).
The Republic appeals the adverse decision promulgated on January 30,
2004,1 whereby the Court of Appeals (CA) affirmed the judgment rendered
on August 10, 1981 by the erstwhile Court of First Instance (CFI) of Bulacan
(now the Regional Trial Court) in Registration Case No. 3446-M granting the
application of the respondent for the registration of her title covering a
parcel of land situated in San Isidro, Paombong, Bulacan.2
The respondent filed her application for land registration in the CFI in
Bulacan.3 The jurisdictional requirements were met when the notice of initial
hearing was published in the Official Gazette for two successive weeks, 4 as
evidenced by a certification of publication.5 The notice of initial hearing was
also posted by the Provincial Sheriff of Bulacan in a conspicuous place in the
municipal building of Paombong, Bulacan as well as on the property
itself.6 On June 2, 1977, at the initial hearing of the application, Fiscal
Liberato L. Reyes interposed an opposition in behalf of the Director of Lands
and the Bureau of Public Works. Upon motion by the respondent and
without objection from Fiscal Reyes, the CFI commissioned the Acting Deputy
Clerk of Court to receive evidence in the presence of Fiscal Reyes. 7
The records show that the land subject of the application was a riceland with
an area of 12,342 square meters known as Lot 2633, Cad-297, Paombong,
Bulacan, and covered by plan Ap-03-001603;8 that the riceland had been
originally owned and possessed by one Mamerto Dionisio since 1907;9 that
on May 13, 1926, Dionisio, by way of a deed of sale,10 had sold the land to
Romualda Jacinto; that upon the death of Romualda Jacinto, her sister Maria
Jacinto (mother of the respondent) had inherited the land; that upon the
death of Maria Jacinto in 1963, the respondent had herself inherited the
land, owning and possessing it openly, publicly, uninterruptedly, adversely
against the whole world, and in the concept of owner since then; that the
land had been declared in her name for taxation purposes; and that the taxes
due thereon had been paid, as shown in Official Receipt No. H-7100234.11
In their opposition filed by Fiscal Reyes,12 the Director of Lands and the
Director of Forest Development averred that whatever legal and possessory
rights the respondent had acquired by reason of any Spanish government
grants had been lost, abandoned or forfeited for failure to occupy and
possess the land for at least 30 years immediately preceding the filing of the
application;13 and that the land applied for, being actually a portion of the
Labangan Channel operated by the Pampanga River Control System, could
not be subject of appropriation or land registration.14
The Office of the Solicitor General (OSG) also filed in behalf of the
Government an opposition to the application,15 insisting that the land was
within the unclassified region of Paombong, Bulacan, as indicated in BF Map
LC No. 637 dated March 1, 1927; that areas within the unclassified region
were denominated as forest lands and thus fell under the exclusive
jurisdiction, control and authority of the Bureau of Forest Development
(BFD);16 and that the CFI did not acquire jurisdiction over the application
considering that: (1) the land was beyond the commerce of man; (2) the
payment of taxes vested no title or ownership in the declarant or taxpayer.17
Ruling ofthe CFI
On August 10, 1981, the CFI rendered its decision, 18 ordering the registration
of the land in favor of the respondent on the ground that she had sufficiently
established her open, public, continuous, and adverse possession in the
concept of an owner for more than 30 years, to wit:
Since it has been established that the applicants and her predecessors-in-
interest have been in the open, public, continuous, and adverse possession
of the said parcel of land in the concept of an owner for more than thirty (30)
years, that it, since 1926 up to the present time, applicant therefore is
entitled to the registration thereof under the provisions od Act No. 496, in
relation to Commonwealth Act No. 141 as amended by Republic Act No. 6236
and other existing laws.
WHEREFORE, confirming the order of general default issued in this case, the
Court hereby orders the registration of this parcel of land Lot 2633, Cad 297.
Case 5, Paombong Cadastre[)] described in plan Ap-03-001603 (Exhibit D,
page 7 of records) and in the technical description (Exhibit F, page 5 of
records) in favor of Rosario de Guzman Vda de Joson, of legal age, Filipino,
widow and resident of Malolos, Bulacan.
After the decision shall have become final, let the corresponding decree be
issued,
SO ORDERED19.
The Republic, through the OSG, appealed to the CA, contending that the trial
court had erred in granting the application for registration despite the land
not being the subject of land registration due to its being part of the
unclassified region denominated as forest land of Paombong, Bulacan. 20
Judgment of the CA
On January 30, 2004, the CA promulgated its assailed judgment,21 affirming
the decision of the trial court upon the following ratiocination:
The foregoing documentary and testimonial evidence stood unrebutted and
uncontroverted by the oppositor-appellant and they should serve as proof of
the paucity of the claim of the applicant-appellee over the subject property.
Upon the other hand, oppositor-appellant, in a lackluster fashion, advanced
pro forma theories and arguments in its Opposition which naturally failed to
merit any consideration from the court a quo and also from this Court. The
indorsement from the Bureau of Forest Development, San Fernando,
Pampanga to the effect that the subject area is within the unclassified region
of Paombong, Bulacan does not warrant any evidentiary weight since the
same had never been formally offered as evidence by the oppositor-
appellant. All the other allegations in the Opposition field (sic) by the
oppositor-appellant failed to persuade this Court as to the veracity thereof
considering that no evidence was ever presented to prove the said
allegations.
Such being the case, this Court is not inclined to have the positive proofs of
her registrable rights over the subject property adduced by the applicant-
appellee be defeated by the bare and unsubstantiated allegations of the
oppositor-appellant.
WHEREFORE, PREMISES CONSIDERED, the assailed Decision is hereby
AFFIRMED IN TOTO.
SO ORDERED.22
Hence, the Republic appeals by petition for review on certiorari.
Issue
(1) WHETHER OR NOT THE LAND SUBJECT OF THE APPLICATION FOR
REGISTRATION IS SUSCEPTIBLE OF PRIVATE ACQUISITION; and
(2) WHETHER OR NOT THE TRIAL COURT, AS WELL AS THE COURT OF
APPEALS, ERRED IN GRANTING THE APPLICATION FOR REGISTRATION. 23
Ruling
The appeal is impressed with merit.
Section 14 (1) and (2) of the Property Registration Decree state:
Section 14. Who may apply. — The following persons may file in the proper
[Regional Trial Court] an application for registration of title to land, whether
personally or through their duly authorized representatives:
(1) Those who by themselves or through their predecessors-in-interest have
been in open, continuous, exclusive and notorious possession and
occupation of alienable and disposable lands of the public domain under a
bona fide claim of ownership since June 12, 1945, or earlier.
(2) Those who have acquired ownership of private lands by prescription
under the provision of existing laws.
xxxx
Section 14(1) deals with possession and occupation in the concept of an
owner while Section 14(2) involves prescription as a mode of acquiring
ownership. In Heirs of Mario Malabanan v. Republic,24 the Court set the
guidelines concerning land registration proceedings brought under these
provisions of the Property Registration Decree in order provide clarity to the
application and scope of said provisions.
The respondent sought to have the land registered in her name by alleging
that she and her predecessors-in-interest had been in open, peaceful,
continuous, uninterrupted and adverse possession of the land in the concept
of owner since time immemorial. However, the Republic counters that the
land was public land; and that it could not be acquired by prescription. The
determination of the issue hinges on whether or not the land was public; if
so, whether the respondent satisfactorily proved that the land had already
been declared as alienable and disposable land of the public domain; and
that she and her predecessors-in-interest had been in open, peaceful,
continuous, uninterrupted and adverse possession of the land in the concept
of owner since June 12, 1945, or earlier.
In Republic vs. Tsai,25 the Court summarizes the amendments that have
shaped the current phraseology of Section 14(1), to wit:
Through the years, Section 48(b) of the CA 141 has been amended several
times. The Court of Appeals failed to consider the amendment introduced by
PD 1073. In Republic v. Doldol, the Court provided a summary of these
amendments:
The original Section 48(b) of C.A. No.141 provided for possession and
occupation of lands of the public domain since July 26, 1894. This was
superseded by R.A. No. 1942, which provided for a simple thirty-year
prescriptive period of occupation by an applicant for judicial confirmation of
imperfect title. The same, however, has already been amended by
Presidential Decree No. 1073, approved on January 25, 1977. As amended,
Section 48(b) now reads:
(b) Those who by themselves or through their predecessors in interest have
been in open, continuous, exclusive, and notorious possession and
occupation of agricultural lands of the public domain, under a bona fide claim
of acquisition of ownership, since June 12, 1945, or earlier, immediately
preceding the filing of the application for confirmation of title, except when
prevented by war or force majeure. These shall be conclusively presumed to
have performed all the conditions essential to a Government grant and shall
be entitled to a certificate of title under the provisions of this chapter.
(Emphasis supplied)
As the law now stands, a mere showing of possession and occupation for 30
years or more is not sufficient. Therefore, since the effectivity of PD 1073 on
25 January 1977, it must now be shown that possession and occupation of
the piece of land by the applicant, by himself or through his predecessors-in-
interest, started on 12 June 1945 or earlier. This provision is in total
conformity with Section 14(1) of PD 1529.26
Under Section 14(1), therefore, the respondent had to prove that: (1) the
land formed part of the alienable and disposable land of the public domain;
and (2) she, by herself or through her predecessors-in-interest, had been in
open, continuous, exclusive, and notorious possession and occupation of the
subject land under a bona fide claim of ownership from June 12, 1945, or
earlier.27 It is the applicant who carries the burden of proving that the two
requisites have been met. Failure to do so warrants the dismissal of the
application.
The respondent unquestionably complied with the second requisite by virtue
of her having been in open, continuous, exclusive and notorious possession
and occupation of the land since June 12, 1945, or earlier. She testified on
how the land had been passed on to her from her predecessors-in-interest;
and tendered documentary evidence like: (1) the Deed of Sale evidencing the
transfer of the property from Mamerto Dionisio to Romualda Jacinto in
1926;28 (2) Tax Declaration No. 4547 showing that she had declared the
property for taxation purposes in 1976;29 and (3) Official Receipt No. H-
7100234 indicating that she had been paying taxes on the land since
1977.30 The CFI found her possession of the land and that of her
predecessors-in-interest to have been open, public, continuous, and adverse
in the concept of an owner since 1926 until the present time, or for more
than 30 years, entitling her to the registration under the provisions of Act No.
496, in relation to Commonwealth Act No. 141, as amended by Republic Act
No. 6236 and other existing laws. 31 On its part, the CA ruled that the
documentary and testimonial evidence stood unrebutted and
uncontroverted by the Republic.32
Nonetheless, what is left wanting is the fact that the respondent did not
discharge her burden to prove the classification of the land as demanded by
the first requisite. She did not present evidence of the land, albeit public,
having been declared alienable and disposable by the State. During trial, she
testified that the land was not within any military or naval reservation, and
Frisco Domingo, her other witness, corroborated her. Although the Republic
countered that the verification made by the Bureau of Forest Development
showed that the land was within the unclassified region of Paombong,
Bulacan as per BF Map LC No. 637 dated March 1, 1927,33 such showing was
based on the 1st Indorsement dated July 22, 1977 issued by the Bureau of
Forest Development,34 which the CA did not accord any evidentiary weight to
for failure of the Republic to formally offer it in evidence. Still, Fiscal Reyes, in
the opposition he filed in behalf of the Government, argued that the land
was a portion of the Labangan Channel operated by the Pampanga River
Control System, and could not be the subject of appropriation or land
registration. Thus, the respondent as the applicant remained burdened with
proving her compliance with the first requisite.
Belatedly realizing her failure to prove the alienable and disposable
classification of the land, the petitioner attached as Annex A to her appellee’s
brief35 the certification dated March 8, 2000 issued by the Department of
Environment and Natural Resources–Community Environment and Natural
Resources Office (DENR-CENRO),36 viz:
THIS IS TO CERTIFY that the parcel of land described on lot 2633 located at
San Isidro, Paombong, Bulacan as shown in the sketch plan surveyed by
Geodetic Engineer Carlos G. Reyes falls within the Alienable or Disposable
Land Project No. 19 of Paombong, Bulacan per Land Classification Map No.
2934 certified on October 15, 1980.
However, in its resolution of July 31, 2000,37 the CA denied her motion to
admit the appellee’s brief, and expunged the appellee’s brief from the
records. Seeing another opportunity to make the certification a part of the
records, she attached it as Annex A of her comment here. 38 Yet, that attempt
to insert would not do her any good because only evidence that was offered
at the trial could be considered by the Court.
Even had the respondent’s effort to insert the certification been successful,
the same would nonetheless be vain and ineffectual. In Menguito v.
Republic,39 the Court pronounced that a survey conducted by a geodetic
engineer that included a certification on the classification of the land as
alienable and disposable was not sufficient to overcome the presumption
that the land still formed part of the inalienable public domain, to wit:
To prove that the land in question formed part of the alienable and
disposable lands of the public domain, petitioners relied on the printed
words which read: "This survey plan is inside Alienable and Disposable Land
Area, Project No. 27-B as per L.C. Map No. 2623, certified by the Bureau of
Forestry on January 3, 1968," appearing on Exhibit "E" (Survey Plan No. Swo-
13-000227).
This proof is not sufficient. Section 2, Article XII of the 1987 Constitution,
provides: "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. x x x." (Emphasis supplied.)
For the original registration of title, the applicant (petitioners in this case)
must overcome the presumption that the land sought to be registered forms
part of the public domain. Unless public land is shown to have been
reclassified or alienated to a private person by the State, it remains part of
the inalienable public domain. Indeed, "occupation thereof in the concept of
owner, no matter how long, cannot ripen into ownership and be registered
as a title." To overcome such presumption, incontrovertible evidence must
be shown by the applicant. Absent such evidence, the land sought to be
registered remains inalienable.
In the present case, petitioners cite a surveyor-geodetic engineer’s notation
in Exhibit "E" indicating that the survey was inside alienable and disposable
land. Such notation does not constitute a positive government act validly
changing the classification of the land in question. Verily, a mere surveyor
has no authority to reclassify lands of the public domain. By relying solely on
the said surveyor’s assertion, petitioners have not sufficiently proven that the
land in question has been declared alienable.40
We reiterate the standing doctrine that land of the public domain, to be the
subject of appropriation, must be declared alienable and disposable either by
the President or the Secretary of the DENR. In Republic v. T.A.N. Properties,
Inc.,41 we explicitly ruled:
The applicant for land registration must prove that the DENR Secretary had
approved the land classification and released the land of the public domain
as alienable and disposable, and that the land subject of the application for
registration falls within the approved area per verification through survey by
the PENRO or CENRO. In addition, the applicant for land registration must
present a copy of the original classification approved by the DENR Secretary
and certified as a true copy by the legal custodian of the official records.
These facts must be established to prove that the land is alienable and
disposable.42
This doctrine unavoidably means that the mere certification issued by the
CENRO or PENRO did not suffice to support the application for registration,
because the applicant must also submit a copy of the original classification of
the land as alienable and disposable as approved by the DENR Secretary and
certified as a true copy by the legal custodian of the official records. As the
Court said in Republic v. Bantigue Point Development Corporation:43
The Regalian doctrine dictates that all lands of the public domain belong to
the State. The applicant for land registration has the burden of overcoming
the presumption of State ownership by establishing through incontrovertible
evidence that the land sought to be registered is alienable or disposable
based on a positive act of the government. We held in Republic v. T.A.N.
Properties, Inc. that a CENRO certification is insufficient to prove the
alienable and disposable character of the land sought to be registered. The
applicant must also show sufficient proof that the DENR Secretary has
approved the land classification and released the land in question as
alienable and disposable.
Thus, the present rule is that an application for original registration must be
accompanied by (1) a CENRO or PENRO Certification; and (2) a copy of the
original classification approved by the DENR Secretary and certified as a true
copy by the legal custodian of the official records.
Here, respondent Corporation only presented a CENRO certification in
support of its application. Clearly, this falls short of the requirements for
original registration.44
Yet, even assuming that the DENR-CENRO certification alone would have
sufficed, the respondent’s application would still be denied considering that
the reclassification of the land as alienable or disposable came only after the
filing of the application in court in 1976. The certification itself indicated that
the land was reclassified as alienable or disposable only on October 15, 1980.
The consequence of this is fittingly discussed in Heirs of Mario Malabanan v.
Republic, to wit:
We noted in Naguit that it should be distinguished from Bracewell v. Court of
Appeals since in the latter, the application for registration had been filed
before the land was declared alienable or disposable. The dissent though
pronounces Bracewell as the better rule between the two. Yet two years
after Bracewell, its ponente, the esteemed Justice Consuelo Ynares-Santiago,
penned the ruling in Republic v. Ceniza, which involved a claim of possession
that extended back to 1927 over a public domain land that was declared
alienable and disposable only in 1980. Ceniza cited Bracewell, quoted
extensively from it, and following the mindset of the dissent, the attempt at
registration in Ceniza should have failed. Not so.
To prove that the land subject of an application for registration is alienable,
an applicant must establish the existence of a positive act of the government
such as a presidential proclamation or an executive order; an administrative
action; investigation reports of Bureau of Lands investigators; and a
legislative act or a statute.
In this case, private respondents presented a certification dated November
25, 1994, issued by Eduardo M. Inting, the Community Environment and
Natural Resources Officer in the Department of Environment and Natural
Resources Office in Cebu City, stating that the lots involved were "found to
be within the alienable and disposable (sic) Block-I, Land Classification
Project No. 32-A, per map 2962 4-I555 dated December 9, 1980." This is
sufficient evidence to show the real character of the land subject of private
respondents’ application. Further, the certification enjoys a presumption of
regularity in the absence of contradictory evidence, which is true in this case.
Worth noting also was the observation of the Court of Appeals stating that:
[n]o opposition was filed by the Bureaus of Lands and Forestry to contest the
application of appellees on the ground that the property still forms part of
the public domain. Nor is there any showing that the lots in question are
forestal land...."
Thus, while the Court of Appeals erred in ruling that mere possession of
public land for the period required by law would entitle its occupant to a
confirmation of imperfect title, it did not err in ruling in favor of private
respondents as far as the first requirement in Section 48(b) of the Public Land
Act is concerned, for they were able to overcome the burden of proving the
alienability of the land subject of their application.
As correctly found by the Court of Appeals, private respondents were able to
prove their open, continuous, exclusive and notorious possession of the
subject land even before the year 1927. As a rule, we are bound by the
factual findings of the Court of Appeals. Although there are exceptions,
petitioner did not show that this is one of them."
Why did the Court in Ceniza, through the same eminent member who
authored Bracewell, sanction the registration under Section 48(b) of public
domain lands declared alienable or disposable thirty-five (35) years and 180
days after 12 June 1945? The telling difference is that in Ceniza, the
application for registration was filed nearly six (6) years after the land had
been declared alienable or disposable, while in Bracewell, the application
was filed nine (9) years before the land was declared alienable or disposable.
That crucial difference was also stressed in Naguit to contradistinguish it
from Bracewell, a difference which the dissent seeks to belittle. 45 (citations
omitted)
On the other hand, under Section 14(2), ownership of private lands acquired
through prescription may be registered in the owner’s name. Did the
respondent then acquire the land through prescription considering that her
possession and occupation of the land by her and her predecessors-in-
interest could be traced back to as early as in 1926, and that the nature of
their possession and occupation was that of a bona fide claim of ownership
for over 30 years?
Clearly, the respondent did not. Again, Heirs of Mario Malabanan v. Republic
is enlightening, to wit:
It is clear that property of public dominion, which generally includes property
belonging to the State, cannot be the object of prescription or, indeed, be
subject of the commerce of man. Lands of the public domain, whether
declared alienable and disposable or not, are property of public dominion
and thus insusceptible to acquisition by prescription.
Let us now explore the effects under the Civil Code of a declaration by the
President or any duly authorized government officer of alienability and
disposability of lands of the public domain. Would such lands so declared
alienable and disposable be converted, under the Civil Code, from property
of the public dominion into patrimonial property? After all, by connotative
definition, alienable and disposable lands may be the object of the
commerce of man; Article 1113 provides that all things within the commerce
of man are susceptible to prescription; and the same provision further
provides that patrimonial property of the State may be acquired by
prescription.
Nonetheless, Article 422 of the Civil Code states that "[p]roperty of public
dominion, when no longer intended for public use or for public service, shall
form part of the patrimonial property of the State." It is this provision that
controls how public dominion property may be converted into patrimonial
property susceptible to acquisition by prescription. After all, Article 420 (2)
makes clear that those property "which belong to the State, without being
for public use, and are intended for some public service or for the
development of the national wealth" are public dominion property. For as
long as the property belongs to the State, although already classified as
alienable or disposable, it remains property of the public dominion if when it
is "intended for some public service or for the development of the national
wealth".1âwphi1
Should public domain lands become patrimonial because they are declared
as such in a duly enacted law or duly promulgated proclamation that they are
no longer intended for public service or for the development of the national
wealth, would the period of possession prior to the conversion of such public
dominion into patrimonial be reckoned in counting the prescriptive period in
favor of the possessors? We rule in the negative.
The limitation imposed by Article 1113 dissuades us from ruling that the
period of possession before the public domain land becomes patrimonial
may be counted for the purpose of completing the prescriptive period.
Possession of public dominion property before it becomes patrimonial
cannot be the object of prescription according to the Civil Code. As the
application for registration under Section 14(2) falls wholly within the
framework of prescription under the Civil Code, there is no way that
possession during the time that the land was still classified as public
dominion property can be counted to meet the requisites of acquisitive
prescription and justify registration.48
In other words, the period of possession prior to the reclassification of the
land, no matter how long, was irrelevant because prescription did not
operate against the State before then.
WHEREFORE, the Court REVERSES and SETS ASIDE the decision of the Court
of Appeals promulgated on January 30, 2004; DISMISSES the application for
land registration of respondent Rosario de Guzman Vda. De Joson respecting
Lot 2633, Cad-297 with a total area of 12,342 square meters, more or less,
situated in San Isidro, Paombong, Bulacan; and DIRECTS the respondent to
pay the costs of suit.
SO ORDERED.

Accordingly, there must be an express declaration by the State that the

public dominion property is no longer intended for public service or the
development of the national wealth or that the property has been converted
into patrimonial. Without such express declaration, the property, even if
classified as alienable or disposable, remains property of the public
dominion, pursuant to Article 420(2), and thus incapable of acquisition by
prescription. It is only when such alienable and disposable lands are expressly
declared by the State to be no longer intended for public service or for the
development of the national wealth that the period of acquisitive
prescription can begin to run. Such declaration shall be in the form of a law
duly enacted by Congress or a Presidential Proclamation in cases where the
President is duly authorized by law.

It is comprehensible with ease that this reading of Section 14(2) of the

Property Registration Decree limits its scope and reach and thus affects the
registrability even of lands already declared alienable and disposable to the
detriment of the bona fide possessors or occupants claiming title to the
lands. Yet this interpretation is in accord with the Regalian doctrine and its
concomitant assumption that all lands owned by the State, although declared
alienable or disposable, remain as such and ought to be used only by the
Government.

Recourse does not lie with this Court in the matter.1âwphi1 The duty of the
Court is to apply the Constitution and the laws in accordance with their
language and intent. The remedy is to change the law, which is the province
of the legislative branch. Congress can very well be entreated to amend
Section 14(2) of the Property Registration Decree and pertinent provisions of
the Civil Code to liberalize the requirements for judicial confirmation of
imperfect or incomplete titles.46

The period of possession prior to the reclassification of the land as alienable

and disposable land of the public domain is not considered in reckoning the
prescriptive period in favor of the possessor. As pointedly clarified also in
Heirs of Mario Malabanan v. Republic:47
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.
G.R. No. 150413            July 1, 2003
REPUBLIC OF THE PHILIPPINES, petitioner,
vs.
ALEXANDRA LAO, respondent.
YNARES-SANTIAGO, J.:
1 REGISTRATION OF TITLE OF SUBJECT PROPERTY IN THE NAME OF
This petition for review assails the decision  of the Court of Appeals in CA-
G.R. CV No. 56230, which affirmed the judgment2 of the Regional Trial Court
of Tagaytay City, Branch 18, in Land Registration Case No. TG-719.
On September 4, 1995, respondent Alexandra Lao filed with the Regional
Trial Court of Tagaytay City, Branch 18, an application for the registration of
title over a parcel of land designated as Lot No. 3951, Cad. 452-D, Silang
Cadastre, Plan Ap-04-007770, consisting of nine thousand three hundred
forty nine (9,349) square meters under Presidential Decree No. 1529,
otherwise known as the Property Registration Decree. Respondent alleged
that she acquired the land by purchase from the siblings Raymundo Noguera
and Ma. Victoria A. Valenzuela, who inherited it from Generosa Medina. The
latter, in turn, inherited the land from her father, Jose Medina, who acquired
the same from Edilberto Perido by transfer.
In the alternative, respondent prayed that the land be awarded to her under
the provisions of Commonwealth Act No. 141, as amended, also known as
the Public Land Act, based on her and her predecessor’s open, public, actual,
continuous, exclusive, notorious and adverse possession and occupancy
under bona fide claim of ownership for more than thirty (30) years.
At the hearing in the lower court, respondent presented the following
witnesses: Candido Amoroso, who testified on the ownership of the land by
Edilberto Perido in 1932; Vicente Laudato, who testified on respondent’s
purchase of the property from Raymundo and Ma. Victoria; and Fina Victoria
So-Liwanag, who assisted respondent in her application for registration.
Respondent likewise presented in evidence the Deed of Absolute Sale 3 dated
April 19, 1994 executed by Raymundo and Victoria in her favor, the survey
plan and technical description of the property, and the tax declarations in the
name of respondent as well as her predecessors-in-interest.
On June 28, 1996, the trial court made the following findings, to wit:
x x x the applicant acquired the subject parcel of land by purchase from
Raymundo Noguera and Ma. Victoria A. Valenzuela in 1994, and that
applicant and her predecessors-in-interest have been in continuous,
uninterrupted, open, public, adverse and in the concept of an owner
possession of the subject parcel of land for more than thirty (30) years now;
and that the same parcel was declared for taxation purposes; that the realty
taxes due thereon have been duly paid; that the land involved in this case is
not covered by any land patent. Likewise, this Court could well-discern from
the survey plan covering the same property, as well as technical description
and other documents presented, that the land sought to be registered is
agricultural and not within any forest zone or public domain; and that tacking
her predecessors-in-interest’s possession to hers, applicant appears to be in
continuous and public possession thereof for more than thirty (30) years. 4
The dispositive portion of the decision reads:
WHEREFORE, this Court hereby approves this application for registration and
thus places under the operation of Act 141, Act 496 and/or P.D. 1529,
otherwise known as Property Registration Law, the land described in Plan Ap-
04-007770 and containing an area of nine thousand three hundred forty-nine
(9,349) square meters as supported by its technical description now forming
part of the record of this case, in addition to other proofs adduced in the
name of ALEXANDRA A. LAO, of legal age, married to NELSON O. LAO, Filipino
citizen, with residence at 1648 Yakal Street, Sta. Cruz, Manila.
Once this Decision becomes final and executory, the corresponding decree of
registration shall forthwith issue.
SO ORDERED.5
Petitioner Republic of the Philippines, represented by the Office of the
Solicitor General, appealed to the Court of Appeals which was docketed as
CA-G.R. CV No. 56230. On October 15, 2001, the appellate court affirmed the
judgment of the trial court.6 Hence, this petition for review raising the
following errors:
THERE IS NO SUFFICIENT EVIDENCE TO WARRANT THE ORIGINAL
RESPONDENT.7
A. RESPONDENT FAILED TO COMPLY WITH THE LEGALLY REQUIRED PERIOD
AND ACTS OF POSSESSION.8
B. THE TAX DECLARATIONS PRESENTED BY RESPONDENT DO NOT
CORROBORATE HER CLAIM OF THE LEGALLY REQUIRED PERIOD OF
POSSESSION.9
C. RESPONDENT FAILED TO PRESENT A CERTIFICATION FROM THE
APPROPRIATE GOVERNMENT AGENCY THAT THE LAND SUBJECT OF HER
APPLICATION FOR REGISTRATION IS ALIENABLE AND DISPOSABLE LAND OF
THE PUBLIC DOMAIN.10
In sum, the issues presented before us are (a) whether or not respondent
was able to prove, by the quantum of evidence mandated by law, that she
met the required period of open, exclusive, continuous and notorious
possession, in the concept of an owner, of the subject parcel of land; and (b)
whether or not respondent was able to show that the land subject of her
application was disposable and alienable land of the public domain.
Section 14 (1) of Presidential Decree No. 1529 states:
Who may apply. – The following persons may file in the proper Court of First
Instance an application for registration of title to land, whether personally or
through their duly authorized representatives:
(1) Those who by themselves or through their predecessor-in-interest have
been in open, continuous, exclusive and notorious possession and
occupation of alienable and disposable lands of the public domain under a
bona fide claim of ownership since June 12, 1945, or earlier.
On the other hand, Section 48 (b) of Commonwealth Act No. 141, as
amended by Section 4 of Presidential Decree No. 1073, provides:
The provisions of Section 48(b) and Section 48(c), Chapter VIII, of the Public
Land Act are hereby amended in the sense that these provisions shall apply
only to alienable and disposable lands of the public domain which have been
in open, continuous, exclusive and notorious possession and occupation by
the applicant himself or thru his predecessor-in-interest, under a bona fide
claim of acquisition of ownership, since June 12, 1945.
Thus, before one can register his title over a parcel of land, the applicant
must show that (a) he, by himself or through his predecessors-in-interest, has
been in open, continuous, exclusive and notorious possession and
occupation of the subject land under a bona fide claim of ownership since
June 12, 1945 or earlier; and (b) the land subject of the application is
alienable and disposable land of the public domain.
Respondent submits that Section 48 (b) of CA 141 was amended by Republic
Act No. 6940, which reduced the required period of possession to thirty
years immediately prior to the filing of the application. Said law became
effective on April 15, 1990. However, petitioner maintains that the required
period of possession remained the same. RA 6940 explicitly states that its
provisions amended sections 44, 45 and 47 of CA 141. Nothing in RA 6940
amends Section 48 (b). In other words, the requisites for judicial confirmation
of imperfect or incomplete title set forth therein remains the same, namely,
(1) possession of the subject land from June 12, 1945, and (2) the
classification of the land as alienable and disposable land of the public
domain. In Public Estates Authority v. Court of Appeals,11 we held that:
Under the public land act, judicial confirmation of imperfect title required
possession en concepto de dueño since time immemorial, or since July 26,
1894. Under C.A. No. 141, this requirement was retained. However, on June
22, 1957, Republic Act No. 1942 was enacted amending C.A. No. 141. This
later enactment required adverse possession for a period of only thirty (30)
years. On January 25, 1977, the President enacted P.D. No. 1073, further
amending C.A. No. 141, extending the period for filing applications for
judicial confirmation of imperfect or incomplete titles to December 31, 1987.
Under this decree, "the provisions of Section 48 (b) and Section 48 (c),
Chapter VIII, of the Public Land Act are hereby amended in the sense that
these provisions shall apply only to alienable and disposable land of the
public domain which have been in open, continuous, exclusive and notorious
possession and occupation by the applicant himself or thru his predecessors-
in-interest under a bona fide claim of acquisition of ownership, since June 12,
1945.
The aforequoted ruling was reiterated in Republic v. Court of Appeals, 12 thus:
This Court has held in Republic vs. Doldol [295 SCRA 359, (1998)] that,
originally, "Section 48(b) of C.A. No. 141 provided for possession and
occupation of lands of the public domain since July 26, 1894. This was
superseded by R.A. No. 1942 which provided for a simple thirty-year
prescriptive period of occupation by an applicant for judicial confirmation of
imperfect title. The same, however, has already been amended by
Presidential Decree No. 1073, approved on January 25, 1977." As amended
Section 48 (b) now reads:
(b) Those who by themselves or through their predecessors-in-interest have
been in open, continuous, exclusive and notorious possession and
occupation of agricultural lands of the public domain, under a bona fide claim
of acquisition or ownership, since June 12, 1945, or earlier, immediately
preceding the filing of the application for confirmation of title, except when
prevented by wars or force majeure. Those shall be conclusively presumed to
have performed all the conditions essential to a Government grant and shall
be entitled to a certificate of title under the provisions of this chapter.
Petitioner argues that respondent failed to prove by incontrovertible
evidence that she had been in open, continuous, exclusive and notorious
possession and occupation of the subject land, in the concept of an owner,
since June 12, 1945 or earlier. According to petitioner, respondent’s
witnesses did not state the exact period when respondent’s predecessors-in-
interest started occupying the subject land. They only made sweeping
statements to the effect that respondent had been in possession of the
property for more than thirty years. Hence, it can not be conclusively
determined whether respondent and her predecessors-in-interest have truly
been in possession of the property since June 12, 1945 or earlier.
Furthermore, respondent failed to show how the property was transferred
from Generosa Medina to Raymundo Noguera and Ma. Victoria A.
Valenzuela. No extrajudicial settlement of property was established.
Consequently, respondent can not tack her possession with those of
Generosa Medina and her predecessors-in-interest.
There is merit in the petition.
Candido Amoroso, respondent’s first witness, testified that he first knew of
the property in 1932 and that it was owned by a certain Edilberto Perido.
However, no evidence was presented to support his claim. Respondent
submitted the tax declarations in the name of her predecessors-in-interest,
including that of Edilberto. However, the earliest of these documents
pertained to the year 1948 only, three years short of the required period.
Respondent’s other witness, Vicente Laudato, claimed that he had known
about the property since he was ten years old, which was in 1945, and that
Edilberto Perido owned the property. On cross-examination, however, he
testified that he based his information on Edilberto’s ownership of the land
on the fact that the latter used to greet him and his family whenever he
passed by their house. Vicente later on admitted that he did not know with
certainty whether Edilberto was indeed the owner and possessor of the
property.13
Finally, respondent failed to present the extrajudicial settlement or other
document evidencing the transfer of the land from Generosa Medina to
Raymundo Noguera and Ma. Victoria A. Valenzuela. She likewise did not
show the relationship between these parties. She only presented the deed of
sale between her and the latter, where it was stated that Raymundo and Ma.
Victoria inherited the property from Generosa. Hence, respondent can not
tack her possession with those of Generosa and her predecessors-in-interest.
At most, respondent’s possession can only be reckoned from the time that
Raymundo and Ma. Victoria claimed possession of the property.
Respondent having thus failed to show by incontrovertible evidence that her
possession of the land commenced on June 12, 1945 or earlier, she failed to
meet the first requisite under the pertinent provisions of PD 1529 and CA
141.
Petitioner further submits that respondent failed to show that the land
subject of her application is classified as alienable and disposable land of the
public domain. Under the Regalian doctrine which is embodied in our
Constitution,14 all lands of the public domain belong to the State, which is the
source of any asserted right to ownership of land.15 All lands not appearing to
be clearly within private ownership are presumed to belong to the
State.16 Unless public land is shown to have been reclassified or alienated to a
private person by the State, it remains part of the inalienable public
domain.17 To overcome this presumption, incontrovertible evidence must be
established that the land subject of the application is alienable or
disposable.18
In De Ocampo v. Arlos,19 it was held that:
x x x a title may be judicially confirmed under Section 48 of the Public Land
Act only if it pertains to alienable lands of the public domain. Unless such
assets are reclassified and considered disposable and alienable, occupation
thereof in the concept of owner, no matter how long, cannot ripen into
ownership and be registered as a title. Verily, Presidential Decree No. 1073
clarified Section 48 (b) of the Public Land Act by specifically declaring that the
latter applied only to alienable and disposable lands of the public domain.
In the case at bar, no certification from the appropriate government agency
or official proclamation reclassifying the land as alienable and disposable was
presented by respondent. Respondent merely submitted the survey map and
technical descriptions of the land, which contained no information regarding
the classification of the property. These documents are not sufficient to
overcome the presumption that the land sought to be registered forms part
of the public domain.
Respondent argues that she was not required to present any certification
stating that the land is open for disposition because no opposition to her
application was ever made by the appropriate government agencies. She
claims that in the absence of any proof to the contrary, lands of the public
domain are agricultural in nature and thus susceptible to private ownership.
As an applicant for registration of a parcel of land, respondent had the initial
obligation to show that the property involved is agricultural. Being the
interested party, it was incumbent upon her to prove that the land being
registered is indeed alienable or disposable. She cannot rely on the mere
presumption that it was agricultural and, therefore, alienable part of the
public domain.20 Thus, in Director of Lands v. Funtilar,21 we held:
It was rather sweeping for the appellate court to rule that after an applicant
files his application for registration, the burden shifts totally to the
government to prove that the land forms part of the unclassified forest zone.
The ruling in Heirs of Amunategui v. Director of Forestry (126 SCRA 69)
governs applications for confirmation of imperfect title. The applicant
shoulders the burden of overcoming the presumption that the land sought to
be registered forms part of the public domain.
Moreover, the absence of opposition from the government agencies is of no
moment because the State cannot be estopped by the omission, mistake or
error of its officials or agents.22
It bears stressing at this point that declassification of forest land and its
conversion into alienable or disposable land for agricultural or other
purposes requires an express and positive act from the government.23 It
cannot be presumed; but must be established by convincing proof. 24
WHEREFORE, in view of the foregoing, the petition is GRANTED. The decision
of the Court of Appeals in CA-G.R. CV No. 56230 is REVERSED and SET ASIDE.
The application for original registration of title over Lot No. 3951, Cad. 452-D,
Silang Cadastre, Plan Ap-04-007770, which was docketed as Land
Registration Case No. TG-719 before the Regional Trial Court of Tagaytay
City, Branch 18, is DENIED.

SO ORDERED.

G.R. No. L-14213            August 23, 1919

J. H. ANKRON, petitioner-appellee,
vs.
THE GOVERNMENT OF THE PHILIPPINE ISLANDS, objector-appellant.
Assistant Attorney-General Lacson for appellant.
P. J. Moore for appellee.
JOHNSON, J.:
This action was commenced in the Court of First Instance of the Province of
Davao, Department of Mindanao and Sulu. Its purpose was to have
registered, under the Torrens system, a certain piece or parcel of land
situated, bounded and particularly described in the plan and technical
description attached to the complaint and made a part thereof.
The only opposition which was presented was on the part of the Director of
Lands. The oppositor [objector] alleged that the land in question was the
property of the Government of the United States under the control and
administration of the Government of the Philippine Islands.
During the trial of the cause two witnesses only were presented by the
petitioner. No proof whatever was offered by the oppositor. After hearing
and considering the evidence, the Honorable Francisco Soriano, judge,
reached the following conclusions of fact:
1. That the land sought to be registered consists of one parcel of land as
marked and indicated on the plan and technical description presented;
2. That all of said land, with the exception of a small part at the north, the
exact description and extension of which does not appear, has been
cultivated and planted for more than forty-four years prior to the date of this
decision;
3. That said land was formerly occupied, cultivated and planted by Moros,
Mansacas and others, under a claim of ownership, and that they lived
thereon and had their houses thereon, and that portion of the land which
was not planted or cultivated was used as pasture land whereon they
pastured their carabaos, cattle, and horses;
4. That all of said Moros and Mansacas sold, transferred and conveyed all
their right, title and interest in said land to the applicant, J. H. Ankron, some
eleven years past, at which time all of the said former owners moved o n to
adjoining lands where they now reside;
5. That the possession under claim of ownership of the applicant and his
predecessors in interest was shown to have been open, notorious, actual,
public and continuous for more than forty-four years past, and that their
claim was exclusive of any other right adverse to all other claims;
6. That the applicant now has some one hundred fifty (150) hills of hemp,
some eight thousand (8,000) cocoanut trees, a dwelling house, various
laborers' quarters, store-building, large camarin (storehouse of wood, a
galvanized iron and other buildings and improvements on said land.
Upon the foregoing facts the lower court ordered and decreed that said
parcel of land be registered in the name of the said applicant, J. H. Ankron,
subject, however, to the right of the Government of the Philippine Islands to
open a road thereon in the manner and conditions mentioned in said
decision. The conditions mentioned with reference to the opening of the
road, as found in said decision, are that the applicant give his consent, which
he has already done, to the opening of said road which should be fifteen (15)
meters wide and should follow approximately the line of the road as it now
exists subject to the subsequent survey to be made by the engineer of the
province of Davao.
From that decree the Director of Lands appealed to this court.
The appellant argues, first, that the applicant did not sufficiently identify the
land in question. In reply to that argument, the record shows that a detained
and technical description of the land was made a part of the record. The
evidence shows that the boundaries of the land in question were marked by
monuments built of cement. The oppositor neither presented the question of
the failure of proper identification of the land in the lower court nor
presented any proof whatever to show that said cement monuments did not
exist.
The appellant, in his second assignment of error, contends that the appellant
failed to prove his possession and occupation in accordance with the
provisions of paragraph 6 of section 54 of Act No. 926. The important
prerequisites for registration of land imposed by said section 54, paragraph
6, are (a) that the land shall be agricultural public land as defined by the Act
of Congress of July 1, 1902; (b) that the petitioner, by himself or his
predecessors in interest, shall have been in the open, continuous, exclusive
and notorious possession and occupation of the same under a bona fide
claim of ownership for a period of ten years next preceding the taking effect
of said Act.
In the present case the applicant proved, and there was no effort to dispute
said proof, that the land in question was agricultural land and that he and his
predecessors in interest had occupied the same as owners in good faith for a
period of more than forty years prior to the commencement of the present
action. No question is raised nor discussed by the appellant with reference to
the right of the Moros to acquire the absolute ownership and dominion of
the land which they have occupied openly, notoriously, peacefully and
adversely for a long period of years. (Cariño vs. Insular Government, 7 Phil.
Rep., 132 [212 U. S., 449].)
Accepting the undisputed proof, we are of the opinion that said paragraph 6
of section 54 of Act No. 926 has been fully complied with and that the
petitioner, so far as the second assignment of error is concerned, is entitled
to have his land registered under the Torrens system.
Under the third assignment of error the appellant contends that portions of
said land cannot be registered in accordance with the existing Land
Registration Law for the reason that they are manglares. That question is not
discussed in the present brief. The appellant, however., refers the court to
his discussion of that question in the case of Jocson vs. Director of
Forestry (39 Phil. Rep., 560). By reference to the argument in the brief in the
case, it is found that the appellant relied upon the provisions of section 3 of
Act No. 1148 in relation with section 1820 of Act No. 2711 (second
Administrative Code). Section 3 of Act No. 1148 provides that "the public
forests shall include all unreserved lands covered with trees of whatever
age." Said section 1820 (Act No. 2711) provides that "for the purpose of this
chapter 'public forest' includes, except as otherwise specially indicated, all
unreserved public land, including nipa and mangrove swamps, and all forest
reserves of whatever character."
In the case of Mapa vs. Insular Government (10 Phil. Rep., 175), which
decision has been follows in numerous other decision, the phrase
"agricultural public lands" as defined by Act of Congress of July 1, 1902, was
held to mean "those public lands acquired from Spain which are neither
mineral nor timber lands" (forestry lands).
Paragraph 6 of section 54 of Act No. 926 only permits the registration, under
the conditions therein mentioned, of "public agricultural lands." It must
follow, therefore, that the moment that it appears that the land is not
agricultural, the petition for registration must be denied. If the evidence
shows that it is public forestry land or public mineral land, the petition for
registration must be denied. Many definitions have been given for
"agricultural," "forestry," and "mineral" lands. These definitions are valuable
so far as they establish general rules. In this relation we think the executive
department of the Government, through the Bureau of Forestry, may, and
should, in view especially of the provisions of section 4, 8, and 20 of Act No.
1148, define what shall be considered forestry lands, to the end that the
people of the Philippine Islands shall be guaranteed in "the future a
continued supply of valuable timber and other forest products." (Sec. 8, Act
No. 1148.) If the Bureau of Forestry should accurately and definitely define
what lands are forestry, occupants in the future would be greatly assisted in
their proof and the courts would be greatly aided in determining the
question whether the particular land is forestry or other class of lands.
In the case of Jocson vs. Director of Forestry (supra), the Attorney-
General admitted in effect that whether the particular land in question
belongs to one class or another is a question of fact. The mere fact that a
tract of land has trees upon it or has mineral within it is not of itself sufficient
to declare that one is forestry land and the other, mineral land. There must
be some proof of the extent and present or future value of the forestry and
of the minerals. While, as we have just said, many definitions have been
given for "agriculture," "forestry," and "mineral" lands, and that in each case
it is a question of fact, we think it is safe to say that in order to be forestry or
mineral land the proof must show that it is more valuable for the forestry or
the mineral which it contains than it is for agricultural purposes. (Sec. 7, Act
No. 1148.) It is not sufficient to show that there exists some trees upon the
land or that it bears some mineral. Land may be classified as forestry or
mineral today, and, by reason of the exhaustion of the timber or mineral, be
classified as agricultural land tomorrow. And vice-versa, by reason of the
rapid growth of timber or the discovery of valuable minerals, lands classified
as agricultural today may be differently classified tomorrow. Each case must
be decided upon the proof in that particular case, having regard for its
present or future value for one or the other purposes. We believe, however,
considering the fact that it is a matter of public knowledge that a majority of
the lands in the Philippine Islands are agricultural lands, that the courts have
a right to presume, in the absence of evidence to the contrary, that in each
case the lands are agricultural lands until the contrary is shown. Whatever
the land involved in a particular land registration case is forestry or mineral
land must, therefore, be a matter of proof. Its superior value for one purpose
or the other is a question of fact to be settled by the proof in each particular
case. The fact that the land is a manglar [mangrove swamp] is not sufficient
for the courts to decide whether it is agricultural, forestry, or mineral land. It
may perchance belong to one or the other of said classes of land. The
Government, in the first instance, under the provisions of Act No. 1148, may,
by reservation, decide for itself what portions of public land shall be
considered forestry land, unless private interests have intervened before
such reservation is made. In the latter case, whether the land is agricultural,
forestry, or mineral, is a question of proof. Until private interests have
intervened, the Government, by virtue of the terms of said Act (No. 1148),
may decide for itself what portions of the "public domain" shall be set aside
and reserved as forestry or mineral land. (Ramos vs. Director of Lands (39
Phil. Rep., 175; Jocson vs. Director of Forestry, supra.)

In view of the foregoing we are of the opinion, and so order and decree, that
the judgment of the lower court should be and is hereby affirmed, with the
condition that before the final certificate is issued, an accurate survey be
made of the lands to be occupied by the road above mentioned and that a
plan of the same be attached to the original plan upon which the petition
herein is based. It is so ordered, with costs.

Arellano, C.J., Torres, Araullo, Street, Malcolm and Moir, JJ., concur.

G.R. No. L-43938 April 15, 1988

REPUBLIC OF THE PHILIPPINES (DIRECTOR OF FOREST
DEVELOPMENT), petitioner,
vs.
HON. COURT OF APPEALS (THIRD DIVISION) and JOSE Y. DE LA
ROSA, respondents.
G.R. No. L-44081 April 15, 1988
BENGUET CONSOLIDATED, INC., petitioner,
vs.
HON. COURT OF APPEALS, JOSE Y. DE LA ROSA, VICTORIA, BENJAMIN and
EDUARDO, all surnamed DE LA ROSA, represented by their father JOSE Y.
DE LA ROSA, respondents.
G.R. No. L-44092 April 15, 1988
ATOK-BIG WEDGE MINING COMPANY, petitioner,
vs.
HON. COURT OF APPEALS, JOSE Y. DE LA ROSA, VICTORlA, BENJAMIN and
EDUARDO, all surnamed DE LA ROSA, represented by their father, JOSE Y.
DE LA ROSA, respondents.
CRUZ, J.:
The Regalian doctrine reserves to the State all natural wealth that may be
found in the bowels of the earth even if the land where the discovery is
made be private. 1 In the cases at bar, which have been consolidated because
they pose a common issue, this doctrine was not correctly applied.
These cases arose from the application for registration of a parcel of land
filed on February 11, 1965, by Jose de la Rosa on his own behalf and on
behalf of his three children, Victoria, Benjamin and Eduardo. The land,
situated in Tuding, Itogon, Benguet Province, was divided into 9 lots and
covered by plan Psu-225009. According to the application, Lots 1-5 were sold
to Jose de la Rosa and Lots 6-9 to his children by Mamaya Balbalio and Jaime
Alberto, respectively, in 1964. 2
The application was separately opposed by Benguet Consolidated, Inc. as to
Lots 1-5, Atok Big Wedge Corporation, as to Portions of Lots 1-5 and all of
Lots 6-9, and by the Republic of the Philippines, through the Bureau of
Forestry Development, as to lots 1-9. 3
In support of the application, both Balbalio and Alberto testified that they
had acquired the subject land by virtue of prescription Balbalio claimed to
have received Lots 1-5 from her father shortly after the Liberation. She
testified she was born in the land, which was possessed by her parents under
claim of ownership. 4 Alberto said he received Lots 6-9 in 1961 from his
mother, Bella Alberto, who declared that the land was planted by Jaime and
his predecessors-in-interest to bananas, avocado, nangka and camote, and
was enclosed with a barbed-wire fence. She was corroborated by Felix
Marcos, 67 years old at the time, who recalled the earlier possession of the
land by Alberto's father. 5 Balbalio presented her tax declaration in 1956 and
the realty tax receipts from that year to 1964, 6 Alberto his tax declaration in
1961 and the realty tax receipts from that year to 1964. 7
Benguet opposed on the ground that the June Bug mineral claim covering
Lots 1-5 was sold to it on September 22, 1934, by the successors-in-interest
of James Kelly, who located the claim in September 1909 and recorded it on
October 14, 1909. From the date of its purchase, Benguet had been in actual,
continuous and exclusive possession of the land in concept of owner, as
evidenced by its construction of adits, its affidavits of annual assessment, its
geological mappings, geological samplings and trench side cuts, and its
payment of taxes on the land. 8
For its part, Atok alleged that a portion of Lots 1-5 and all of Lots 6-9 were
covered by the Emma and Fredia mineral claims located by Harrison and
Reynolds on December 25, 1930, and recorded on January 2, 1931, in the
office of the mining recorder of Baguio. These claims were purchased from
these locators on November 2, 1931, by Atok, which has since then been in
open, continuous and exclusive possession of the said lots as evidenced by its
annual assessment work on the claims, such as the boring of tunnels, and its
payment of annual taxes thereon. 9
The location of the mineral claims was made in accordance with Section 21 of
the Philippine Bill of 1902 which provided that:
SEC. 21. 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 the citizens of the United States, or of said
islands.
The Bureau of Forestry Development also interposed its objection, arguing
that the land sought to be registered was covered by the Central Cordillera
Forest Reserve under Proclamation No. 217 dated February 16, 1929.
Moreover, by reason of its nature, it was not subject to alienation under the
Constitutions of 1935 and 1973. 10
The trial court * denied the application, holding that the applicants had failed
to prove their claim of possession and ownership of the land sought to be
registered. 11 The applicants appealed to the respondent court, * which
reversed the trial court and recognized the claims of the applicant, but
subject to the rights of Benguet and Atok respecting their mining claims. 12 In
other words, the Court of Appeals affirmed the surface rights of the de la
Rosas over the land while at the same time reserving the sub-surface rights
of Benguet and Atok by virtue of their mining claims.
Both Benguet and Atok have appealed to this Court, invoking their superior
right of ownership. The Republic has filed its own petition for review and
reiterates its argument that neither the private respondents nor the two
mining companies have any valid claim to the land because it is not alienable
and registerable.
It is true that the subject property was considered forest land and included in
the Central Cordillera Forest Reserve, but this did not impair the rights
already vested in Benguet and Atok at that time. The Court of Appeals
correctly declared that:
There is no question that the 9 lots applied for are within the June Bug
mineral claims of Benguet and the "Fredia and Emma" mineral claims of
Atok. The June Bug mineral claim of plaintiff Benguet was one of the 16
mining claims of James E. Kelly, American and mining locator. He filed his
declaration of the location of the June Bug mineral and the same was
recorded in the Mining Recorder's Office on October 14, 1909. All of the Kelly
claims ha subsequently been acquired by Benguet Consolidated, Inc.
Benguet's evidence is that it had made improvements on the June Bug
mineral claim consisting of mine tunnels prior to 1935. It had submitted the
required affidavit of annual assessment. After World War II, Benguet
introduced improvements on mineral claim June Bug, and also conducted
geological mappings, geological sampling and trench side cuts. In 1948,
Benguet redeclared the "June Bug" for taxation and had religiously paid the
taxes.
The Emma and Fredia claims were two of the several claims of Harrison
registered in 1931, and which Atok representatives acquired. Portions of Lots
1 to 5 and all of Lots 6 to 9 are within the Emma and Fredia mineral claims of
Atok Big Wedge Mining Company.
The June Bug mineral claim of Benguet and the Fredia and Emma mineral
claims of Atok having been perfected prior to the approval of the
Constitution of the Philippines of 1935, they were removed from the public
domain and had become private properties of Benguet and Atok.
It is not disputed that the location of the mining claim under consideration
was perfected prior to November 15, 1935, when the Government of the
Commonwealth was inaugurated; and according to the laws existing at that
time, as construed and applied by this court in McDaniel v. Apacible and
Cuisia (42 Phil. 749), a valid location of a mining claim segregated the area
from the public domain. Said the court in that case: The moment the locator
discovered a valuable mineral deposit on the lands located, and perfected his
location in accordance with law, the power of the United States Government
to deprive him of the exclusive right to the possession and enjoyment of the
located claim was gone, the lands had become mineral lands and they were
exempted from lands that could be granted to any other person. The
reservations of public lands cannot be made so as to include prior mineral
perfected locations; and, of course, if a valid mining location is made upon
public lands afterwards included in a reservation, such inclusion or
reservation does not affect the validity of the former location. By such
location and perfection, the land located is segregated from the public
domain even as against the Government. (Union Oil Co. v. Smith, 249 U.S.
337; Van Mess v. Roonet, 160 Cal. 131; 27 Cyc. 546).
"The legal effect of a valid location of a mining claim is not only to segregate
the area from the public domain, but to grant to the locator the beneficial
ownership of the claim and the right to a patent therefor upon compliance
with the terms and conditions prescribed by law. Where there is a valid
location of a mining claim, the area becomes segregated from the public
domain and the property of the locator." (St. Louis Mining & Milling Co. v.
Montana Mining Co., 171 U.S. 650; 655; 43 Law ed., 320, 322.) "When a
location of a mining claim is perfected it has the effect of a grant by the
United States of the right of present and exclusive possession, with the right
to the exclusive enjoyment of all the surface ground as well as of all the
minerals within the lines of the claim, except as limited by the extralateral
right of adjoining locators; and this is the locator's right before as well as
after the issuance of the patent. While a lode locator acquires a vested
property right by virtue of his location made in compliance with the mining
laws, the fee remains in the government until patent issues."(18 R.C.L. 1152)
(Gold Creek Mining Corporation v. Hon. Eulogio Rodriguez, Sec. of Agriculture
and Commerce, and Quirico Abadilla, Director of the Bureau of Mines, 66
Phil. 259, 265-266)
It is of no importance whether Benguet and Atok had secured a patent for as
held in the Gold Creek Mining Corp. Case, for all physical purposes of
ownership, the owner is not required to secure a patent as long as he
complies with the provisions of the mining laws; his possessory right, for all
practical purposes of ownership, is as good as though secured by patent.
We agree likewise with the oppositors that having complied with all the
requirements of the mining laws, the claims were removed from the public
domain, and not even the government of the Philippines can take away this
right from them. The reason is obvious. Having become the private
properties of the oppositors, they cannot be deprived thereof without due
process of law. 13
Such rights were not affected either by the stricture in the Commonwealth
Constitution against the alienation of all lands of the public domain except
those agricultural in nature for this was made subject to existing rights. Thus,
in its Article XIII, Section 1, it was categorically provided that:
SEC. 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 Philipppines 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 60% 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 lands, 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 25
years, except as to water rights for irrigation, water supply, fisheries, or
industrial uses other than the development of water power, in which case
beneficial use may be the measure and the limit of the grant.
Implementing this provision, Act No. 4268, approved on November 8, 1935,
declared:
Any provision of existing laws, executive order, proclamation to the contrary
notwithstanding, all locations of mining claim made prior to February 8, 1935
within lands set apart as forest reserve under Sec. 1826 of the Revised
Administrative Code which would be valid and subsisting location except to
the existence of said reserve are hereby declared to be valid and subsisting
locations as of the date of their respective locations.
The perfection of the mining claim converted the property to mineral land
and under the laws then in force removed it from the public domain. 14 By
such act, the locators acquired exclusive rights over the land, against even
the government, without need of any further act such as the purchase of the
land or the obtention of a patent over it. 15 As the land had become the
private property of the locators, they had the right to transfer the same, as
they did, to Benguet and Atok.
It is true, as the Court of Appeals observed, that such private property was
subject to the "vicissitudes of ownership," or even to forfeiture by non-user
or abandonment or, as the private respondents aver, by acquisitive
prescription. However, the method invoked by the de la Rosas is not
available in the case at bar, for two reasons.
First, the trial court found that the evidence of open, continuous, adverse
and exclusive possession submitted by the applicants was insufficient to
support their claim of ownership. They themselves had acquired the land
only in 1964 and applied for its registration in 1965, relying on the earlier
alleged possession of their predecessors-in-interest. 16 The trial judge, who
had the opportunity to consider the evidence first-hand and observe the
demeanor of the witnesses and test their credibility was not convinced. We
defer to his judgment in the absence of a showing that it was reached with
grave abuse of discretion or without sufficient basis. 17
Second, even if it be assumed that the predecessors-in-interest of the de la
Rosas had really been in possession of the subject property, their possession
was not in the concept of owner of the mining claim but of the property
as agricultural land, which it was not. The property was mineral land, and
they were claiming it as agricultural land. They were not disputing the lights
of the mining locators nor were they seeking to oust them as such and to
replace them in the mining of the land. In fact, Balbalio testified that she was
aware of the diggings being undertaken "down below" 18 but she did not
mind, much less protest, the same although she claimed to be the owner of
the said land.
The Court of Appeals justified this by saying there is "no conflict of interest"
between the owners of the surface rights and the owners of the sub-surface
rights. This is rather doctrine, for it is a well-known principle that the owner
of piece of land has rights not only to its surface but also to everything
underneath and the airspace above it up to a reasonable height. 19 Under the
aforesaid ruling, the land is classified as mineral underneath and agricultural
on the surface, subject to separate claims of title. This is also difficult to
understand, especially in its practical application.
Under the theory of the respondent court, the surface owner will be planting
on the land while the mining locator will be boring tunnels underneath. The
farmer cannot dig a well because he may interfere with the operations below
and the miner cannot blast a tunnel lest he destroy the crops above. How
deep can the farmer, and how high can the miner, go without encroaching on
each other's rights? Where is the dividing line between the surface and the
sub-surface rights?
The Court feels that the rights over the land are indivisible and that the land
itself cannot be half agricultural and half mineral. The classification must be
categorical; the land must be either completely mineral or completely
agricultural. In the instant case, as already observed, the land which was
originally classified as forest land ceased to be so and became mineral — and
completely mineral — once the mining claims were perfected. 20 As long as
mining operations were being undertaken thereon, or underneath, it did not
cease to be so and become agricultural, even if only partly so, because it was
enclosed with a fence and was cultivated by those who were unlawfully
occupying the surface.
What must have misled the respondent court is Commonwealth Act No. 137,
providing as follows:
Sec. 3. All mineral lands of the public domain and minerals 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 60% 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
government established under the Constitution.

SEC. 4. The ownership of, and the right to the use of land for agricultural,
industrial, commercial, residential, or for any purpose other than mining
does not include the ownership of, nor the right to extract or utilize, the
minerals which may be found on or under the surface.

SEC. 5. The ownership of, and the right to extract and utilize, the minerals
included within all areas for which public agricultural land patents are
granted are excluded and excepted from all such patents.

SEC. 6. The ownership of, and the right to extract and utilize, the minerals
included within all areas for which Torrens titles are granted are excluded
and excepted from all such titles.

This is an application of the Regalian doctrine which, as its name implies, is

intended for the benefit of the State, not of private persons. The rule simply
reserves to the State all minerals that may be found in public and even
private land devoted to "agricultural, industrial, commercial, residential or
(for) any purpose other than mining." Thus, if a person is the owner of
agricultural land in which minerals are discovered, his ownership of such land
does not give him the right to extract or utilize the said minerals without the
permission of the State to which such minerals belong.

The flaw in the reasoning of the respondent court is in supposing that the
rights over the land could be used for both mining and non-mining
purposes simultaneously. The correct interpretation is that once minerals are
discovered in the land, whatever the use to which it is being devoted at the
time, such use may be discontinued by the State to enable it to extract the
minerals therein in the exercise of its sovereign prerogative. The land is thus
converted to mineral land and may not be used by any private party,
including the registered owner thereof, for any other purpose that will
impede the mining operations to be undertaken therein, For the loss
sustained by such owner, he is of course entitled to just compensation under
the Mining Laws or in appropriate expropriation proceedings. 21

Our holding is that Benguet and Atok have exclusive rights to the property in
question by virtue of their respective mining claims which they validly
acquired before the Constitution of 1935 prohibited the alienation of all
lands of the public domain except agricultural lands, subject to vested rights
existing at the time of its adoption. The land was not and could not have
been transferred to the private respondents by virtue of acquisitive
prescription, nor could its use be shared simultaneously by them and the
mining companies for agricultural and mineral purposes.

WHEREFORE, the decision of the respondent court dated April 30, 1976, is
SET ASIDE and that of the trial court dated March 11, 1969, is REINSTATED,
without any pronouncement as to costs.

SO ORDERED.

G.R. No. 133250           July 9, 2002

FRANCISCO I. CHAVEZ, petitioner,
vs.
PUBLIC ESTATES AUTHORITY and AMARI COASTAL BAY DEVELOPMENT
CORPORATION, respondents.
CARPIO, J.:
This is an original Petition for Mandamus with prayer for a writ of preliminary
injunction and a temporary restraining order. The petition seeks to compel
the Public Estates Authority ("PEA" for brevity) to disclose all facts on PEA's
then on-going renegotiations with Amari Coastal Bay and Development
Corporation ("AMARI" for brevity) to reclaim portions of Manila Bay. The
petition further seeks to enjoin PEA from signing a new agreement with
AMARI involving such reclamation.
The Facts
On November 20, 1973, the government, through the Commissioner of
Public Highways, signed a contract with the Construction and Development
Corporation of the Philippines ("CDCP" for brevity) to reclaim certain
foreshore and offshore areas of Manila Bay. The contract also included the
construction of Phases I and II of the Manila-Cavite Coastal Road. CDCP
obligated itself to carry out all the works in consideration of fifty percent of
the total reclaimed land.
On February 4, 1977, then President Ferdinand E. Marcos issued Presidential
Decree No. 1084 creating PEA. PD No. 1084 tasked PEA "to reclaim land,
including foreshore and submerged areas," and "to develop, improve,
acquire, x x x lease and sell any and all kinds of lands."1 On the same date,
then President Marcos issued Presidential Decree No. 1085 transferring to
PEA the "lands reclaimed in the foreshore and offshore of the Manila
Bay"2 under the Manila-Cavite Coastal Road and Reclamation Project
(MCCRRP).
On December 29, 1981, then President Marcos issued a memorandum
directing PEA to amend its contract with CDCP, so that "[A]ll future works in
MCCRRP x x x shall be funded and owned by PEA." Accordingly, PEA and
CDCP executed a Memorandum of Agreement dated December 29, 1981,
which stated:
"(i) CDCP shall undertake all reclamation, construction, and such other works
in the MCCRRP as may be agreed upon by the parties, to be paid according to
progress of works on a unit price/lump sum basis for items of work to be
agreed upon, subject to price escalation, retention and other terms and
conditions provided for in Presidential Decree No. 1594. All the financing
required for such works shall be provided by PEA.
xxx
(iii) x x x CDCP shall give up all its development rights and hereby agrees to
cede and transfer in favor of PEA, all of the rights, title, interest and
participation of CDCP in and to all the areas of land reclaimed by CDCP in the
MCCRRP as of December 30, 1981 which have not yet been sold, transferred
or otherwise disposed of by CDCP as of said date, which areas consist of
approximately Ninety-Nine Thousand Four Hundred Seventy Three (99,473)
square meters in the Financial Center Area covered by land pledge No. 5 and
approximately Three Million Three Hundred Eighty Two Thousand Eight
Hundred Eighty Eight (3,382,888) square meters of reclaimed areas at
varying elevations above Mean Low Water Level located outside the
Financial Center Area and the First Neighborhood Unit."3
On January 19, 1988, then President Corazon C. Aquino issued Special Patent
No. 3517, granting and transferring to PEA "the parcels of land so reclaimed
under the Manila-Cavite Coastal Road and Reclamation Project (MCCRRP)
containing a total area of one million nine hundred fifteen thousand eight
hundred ninety four (1,915,894) square meters." Subsequently, on April 9,
1988, the Register of Deeds of the Municipality of Parañaque issued Transfer
Certificates of Title Nos. 7309, 7311, and 7312, in the name of PEA, covering
the three reclaimed islands known as the "Freedom Islands" located at the
southern portion of the Manila-Cavite Coastal Road, Parañaque City. The
Freedom Islands have a total land area of One Million Five Hundred Seventy
Eight Thousand Four Hundred and Forty One (1,578,441) square meters or
157.841 hectares.
On April 25, 1995, PEA entered into a Joint Venture Agreement ("JVA" for
brevity) with AMARI, a private corporation, to develop the Freedom Islands.
The JVA also required the reclamation of an additional 250 hectares of
submerged areas surrounding these islands to complete the configuration in
the Master Development Plan of the Southern Reclamation Project-MCCRRP.
PEA and AMARI entered into the JVA through negotiation without public
bidding.4 On April 28, 1995, the Board of Directors of PEA, in its Resolution
No. 1245, confirmed the JVA.5 On June 8, 1995, then President Fidel V.
Ramos, through then Executive Secretary Ruben Torres, approved the JVA. 6
On November 29, 1996, then Senate President Ernesto Maceda delivered a
privilege speech in the Senate and denounced the JVA as the "grandmother
of all scams." As a result, the Senate Committee on Government
Corporations and Public Enterprises, and the Committee on Accountability of
Public Officers and Investigations, conducted a joint investigation. The Senate
Committees reported the results of their investigation in Senate Committee
Report No. 560 dated September 16, 1997.7 Among the conclusions of their
report are: (1) the reclaimed lands PEA seeks to transfer to AMARI under the
JVA are lands of the public domain which the government has not classified
as alienable lands and therefore PEA cannot alienate these lands; (2) the
certificates of title covering the Freedom Islands are thus void, and (3) the
JVA itself is illegal.
On December 5, 1997, then President Fidel V. Ramos issued Presidential
Administrative Order No. 365 creating a Legal Task Force to conduct a study
on the legality of the JVA in view of Senate Committee Report No. 560. The
members of the Legal Task Force were the Secretary of Justice, 8 the Chief
Presidential Legal Counsel,9 and the Government Corporate Counsel.10 The
Legal Task Force upheld the legality of the JVA, contrary to the conclusions
reached by the Senate Committees.11
On April 4 and 5, 1998, the Philippine Daily Inquirer and Today published
reports that there were on-going renegotiations between PEA and AMARI
under an order issued by then President Fidel V. Ramos. According to these
reports, PEA Director Nestor Kalaw, PEA Chairman Arsenio Yulo and retired
Navy Officer Sergio Cruz composed the negotiating panel of PEA.
On April 13, 1998, Antonio M. Zulueta filed before the Court a Petition for
Prohibition with Application for the Issuance of a Temporary Restraining
Order and Preliminary Injunction docketed as G.R. No. 132994 seeking to
nullify the JVA. The Court dismissed the petition "for unwarranted disregard
of judicial hierarchy, without prejudice to the refiling of the case before the
proper court."12
On April 27, 1998, petitioner Frank I. Chavez ("Petitioner" for brevity) as a
taxpayer, filed the instant Petition for Mandamus with Prayer for the
Issuance of a Writ of Preliminary Injunction and Temporary Restraining
Order. Petitioner contends the government stands to lose billions of pesos in
the sale by PEA of the reclaimed lands to AMARI. Petitioner prays that PEA
publicly disclose the terms of any renegotiation of the JVA, invoking Section
28, Article II, and Section 7, Article III, of the 1987 Constitution on the right of
the people to information on matters of public concern. Petitioner assails the
sale to AMARI of lands of the public domain as a blatant violation of Section
3, Article XII of the 1987 Constitution prohibiting the sale of alienable lands of
the public domain to private corporations. Finally, petitioner asserts that he
seeks to enjoin the loss of billions of pesos in properties of the State that are
of public dominion.
After several motions for extension of time,13 PEA and AMARI filed their
Comments on October 19, 1998 and June 25, 1998, respectively. Meanwhile,
on December 28, 1998, petitioner filed an Omnibus Motion: (a) to require
PEA to submit the terms of the renegotiated PEA-AMARI contract; (b) for
issuance of a temporary restraining order; and (c) to set the case for hearing
on oral argument. Petitioner filed a Reiterative Motion for Issuance of a TRO
dated May 26, 1999, which the Court denied in a Resolution dated June 22,
1999.
In a Resolution dated March 23, 1999, the Court gave due course to the
petition and required the parties to file their respective memoranda.
On March 30, 1999, PEA and AMARI signed the Amended Joint Venture
Agreement ("Amended JVA," for brevity). On May 28, 1999, the Office of the
President under the administration of then President Joseph E. Estrada
approved the Amended JVA.
Due to the approval of the Amended JVA by the Office of the President,
petitioner now prays that on "constitutional and statutory grounds the
renegotiated contract be declared null and void."14
The Issues
The issues raised by petitioner, PEA15 and AMARI16 are as follows:
I. WHETHER THE PRINCIPAL RELIEFS PRAYED FOR IN THE PETITION ARE
MOOT AND ACADEMIC BECAUSE OF SUBSEQUENT EVENTS;
II. WHETHER THE PETITION MERITS DISMISSAL FOR FAILING TO OBSERVE THE
PRINCIPLE GOVERNING THE HIERARCHY OF COURTS;
III. WHETHER THE PETITION MERITS DISMISSAL FOR NON-EXHAUSTION OF
ADMINISTRATIVE REMEDIES;
IV. WHETHER PETITIONER HAS LOCUS STANDI TO BRING THIS SUIT;
V. WHETHER THE CONSTITUTIONAL RIGHT TO INFORMATION INCLUDES
OFFICIAL INFORMATION ON ON-GOING NEGOTIATIONS BEFORE A FINAL
AGREEMENT;
VI. WHETHER THE STIPULATIONS IN THE AMENDED JOINT VENTURE
AGREEMENT FOR THE TRANSFER TO AMARI OF CERTAIN LANDS, RECLAIMED
AND STILL TO BE RECLAIMED, VIOLATE THE 1987 CONSTITUTION; AND
VII. WHETHER THE COURT IS THE PROPER FORUM FOR RAISING THE ISSUE OF
WHETHER THE AMENDED JOINT VENTURE AGREEMENT IS GROSSLY
DISADVANTAGEOUS TO THE GOVERNMENT.
The Court's Ruling
First issue: whether the principal reliefs prayed for in the petition are moot
and academic because of subsequent events.
The petition prays that PEA publicly disclose the "terms and conditions of the
on-going negotiations for a new agreement." The petition also prays that the
Court enjoin PEA from "privately entering into, perfecting and/or executing
any new agreement with AMARI."
PEA and AMARI claim the petition is now moot and academic because AMARI
furnished petitioner on June 21, 1999 a copy of the signed Amended JVA
containing the terms and conditions agreed upon in the renegotiations. Thus,
PEA has satisfied petitioner's prayer for a public disclosure of the
renegotiations. Likewise, petitioner's prayer to enjoin the signing of the
Amended JVA is now moot because PEA and AMARI have already signed the
Amended JVA on March 30, 1999. Moreover, the Office of the President has
approved the Amended JVA on May 28, 1999.
Petitioner counters that PEA and AMARI cannot avoid the constitutional issue
by simply fast-tracking the signing and approval of the Amended JVA before
the Court could act on the issue. Presidential approval does not resolve the
constitutional issue or remove it from the ambit of judicial review.
We rule that the signing of the Amended JVA by PEA and AMARI and its
approval by the President cannot operate to moot the petition and divest the
Court of its jurisdiction. PEA and AMARI have still to implement the Amended
JVA. The prayer to enjoin the signing of the Amended JVA on constitutional
grounds necessarily includes preventing its implementation if in the
meantime PEA and AMARI have signed one in violation of the Constitution.
Petitioner's principal basis in assailing the renegotiation of the JVA is its
violation of Section 3, Article XII of the Constitution, which prohibits the
government from alienating lands of the public domain to private
corporations. If the Amended JVA indeed violates the Constitution, it is the
duty of the Court to enjoin its implementation, and if already implemented,
to annul the effects of such unconstitutional contract.
The Amended JVA is not an ordinary commercial contract but one which
seeks to transfer title and ownership to 367.5 hectares of reclaimed lands
and submerged areas of Manila Bay to a single private corporation. It now
becomes more compelling for the Court to resolve the issue to insure the
government itself does not violate a provision of the Constitution intended to
safeguard the national patrimony. Supervening events, whether intended or
accidental, cannot prevent the Court from rendering a decision if there is a
grave violation of the Constitution. In the instant case, if the Amended JVA
runs counter to the Constitution, the Court can still prevent the transfer of
title and ownership of alienable lands of the public domain in the name of
AMARI. Even in cases where supervening events had made the cases moot,
the Court did not hesitate to resolve the legal or constitutional issues raised
to formulate controlling principles to guide the bench, bar, and the public.17
Also, the instant petition is a case of first impression. All previous decisions of
the Court involving Section 3, Article XII of the 1987 Constitution, or its
counterpart provision in the 1973 Constitution,18 covered agricultural
lands sold to private corporations which acquired the lands from private
parties. The transferors of the private corporations claimed or could claim
the right to judicial confirmation of their imperfect titles19 under Title II of
Commonwealth Act. 141 ("CA No. 141" for brevity). In the instant case,
AMARI seeks to acquire from PEA, a public corporation, reclaimed lands and
submerged areas for non-agricultural purposes by purchase under PD No.
1084 (charter of PEA) and Title III of CA No. 141. Certain undertakings by
AMARI under the Amended JVA constitute the consideration for the
purchase. Neither AMARI nor PEA can claim judicial confirmation of their
titles because the lands covered by the Amended JVA are newly reclaimed or
still to be reclaimed. Judicial confirmation of imperfect title requires open,
continuous, exclusive and notorious occupation of agricultural lands of the
public domain for at least thirty years since June 12, 1945 or earlier. Besides,
the deadline for filing applications for judicial confirmation of imperfect title
expired on December 31, 1987.20
Lastly, there is a need to resolve immediately the constitutional issue raised
in this petition because of the possible transfer at any time by PEA to AMARI
of title and ownership to portions of the reclaimed lands. Under the
Amended JVA, PEA is obligated to transfer to AMARI the latter's seventy
percent proportionate share in the reclaimed areas as the reclamation
progresses. The Amended JVA even allows AMARI to mortgage at any time
the entire reclaimed area to raise financing for the reclamation project.21
Second issue: whether the petition merits dismissal for failing to observe
the principle governing the hierarchy of courts.
PEA and AMARI claim petitioner ignored the judicial hierarchy by seeking
relief directly from the Court. The principle of hierarchy of courts applies
generally to cases involving factual questions. As it is not a trier of facts, the
Court cannot entertain cases involving factual issues. The instant case,
however, raises constitutional issues of transcendental importance to the
public.22 The Court can resolve this case without determining any factual
issue related to the case. Also, the instant case is a petition for mandamus
which falls under the original jurisdiction of the Court under Section 5, Article
VIII of the Constitution. We resolve to exercise primary jurisdiction over the
instant case.
Third issue: whether the petition merits dismissal for non-exhaustion of
administrative remedies.
PEA faults petitioner for seeking judicial intervention in compelling PEA to
disclose publicly certain information without first asking PEA the needed
information. PEA claims petitioner's direct resort to the Court violates the
principle of exhaustion of administrative remedies. It also violates the rule
that mandamus may issue only if there is no other plain, speedy and
adequate remedy in the ordinary course of law.
PEA distinguishes the instant case from Tañada v. Tuvera23 where the Court
granted the petition for mandamus even if the petitioners there did not
initially demand from the Office of the President the publication of the
presidential decrees. PEA points out that in Tañada, the Executive
Department had an affirmative statutory duty under Article 2 of the Civil
Code24 and Section 1 of Commonwealth Act No. 63825 to publish the
presidential decrees. There was, therefore, no need for the petitioners in
Tañada to make an initial demand from the Office of the President. In the
instant case, PEA claims it has no affirmative statutory duty to disclose
publicly information about its renegotiation of the JVA. Thus, PEA asserts that
the Court must apply the principle of exhaustion of administrative remedies
to the instant case in view of the failure of petitioner here to demand initially
from PEA the needed information.
The original JVA sought to dispose to AMARI public lands held by PEA, a
government corporation. Under Section 79 of the Government Auditing
Code,26 the disposition of government lands to private parties requires public
bidding. PEA was under a positive legal duty to disclose to the public the
terms and conditions for the sale of its lands. The law obligated PEA to make
this public disclosure even without demand from petitioner or from anyone.
PEA failed to make this public disclosure because the original JVA, like the
Amended JVA, was the result of a negotiated contract, not of a public
bidding. Considering that PEA had an affirmative statutory duty to make the
public disclosure, and was even in breach of this legal duty, petitioner had
the right to seek direct judicial intervention.
Moreover, and this alone is determinative of this issue, the principle of
exhaustion of administrative remedies does not apply when the issue
involved is a purely legal or constitutional question.27 The principal issue in
the instant case is the capacity of AMARI to acquire lands held by PEA in view
of the constitutional ban prohibiting the alienation of lands of the public
domain to private corporations. We rule that the principle of exhaustion of
administrative remedies does not apply in the instant case.
Fourth issue: whether petitioner has locus standi to bring this suit
PEA argues that petitioner has no standing to
institute mandamus proceedings to enforce his constitutional right to
information without a showing that PEA refused to perform an affirmative
duty imposed on PEA by the Constitution. PEA also claims that petitioner has
not shown that he will suffer any concrete injury because of the signing or
implementation of the Amended JVA. Thus, there is no actual controversy
requiring the exercise of the power of judicial review.
The petitioner has standing to bring this taxpayer's suit because the petition
seeks to compel PEA to comply with its constitutional duties. There are two
constitutional issues involved here. First is the right of citizens to information
on matters of public concern. Second is the application of a constitutional
provision intended to insure the equitable distribution of alienable lands of
the public domain among Filipino citizens. The thrust of the first issue is to
compel PEA to disclose publicly information on the sale of government lands
worth billions of pesos, information which the Constitution and statutory law
mandate PEA to disclose. The thrust of the second issue is to prevent PEA
from alienating hundreds of hectares of alienable lands of the public domain
in violation of the Constitution, compelling PEA to comply with a
constitutional duty to the nation.
Moreover, the petition raises matters of transcendental importance to the
public. In Chavez v. PCGG,28 the Court upheld the right of a citizen to bring a
taxpayer's suit on matters of transcendental importance to the public, thus -
"Besides, petitioner emphasizes, the matter of recovering the ill-gotten
wealth of the Marcoses is an issue of 'transcendental importance to the
public.' He asserts that ordinary taxpayers have a right to initiate and
prosecute actions questioning the validity of acts or orders of government
agencies or instrumentalities, if the issues raised are of 'paramount public
interest,' and if they 'immediately affect the social, economic and moral well
being of the people.'
Moreover, the mere fact that he is a citizen satisfies the requirement of
personal interest, when the proceeding involves the assertion of a public
right, such as in this case. He invokes several decisions of this Court which
have set aside the procedural matter of locus standi, when the subject of the
case involved public interest.
xxx
In Tañada v. Tuvera, the Court asserted that when the issue concerns a
public right and the object of mandamus is to obtain the enforcement of a
public duty, the people are regarded as the real parties in interest; and
because it is sufficient that petitioner is a citizen and as such is interested in
the execution of the laws, he need not show that he has any legal or special
interest in the result of the action. In the aforesaid case, the petitioners
sought to enforce their right to be informed on matters of public concern, a
right then recognized in Section 6, Article IV of the 1973 Constitution, in
connection with the rule that laws in order to be valid and enforceable must
be published in the Official Gazette or otherwise effectively promulgated. In
ruling for the petitioners' legal standing, the Court declared that the right
they sought to be enforced 'is a public right recognized by no less than the
fundamental law of the land.'
Legaspi v. Civil Service Commission, while reiterating Tañada, further
declared that 'when a mandamus proceeding involves the assertion of a
public right, the requirement of personal interest is satisfied by the mere fact
that petitioner is a citizen and, therefore, part of the general 'public' which
possesses the right.'
Further, in Albano v. Reyes, we said that while expenditure of public funds
may not have been involved under the questioned contract for the
development, management and operation of the Manila International
Container Terminal, 'public interest [was] definitely involved considering the
important role [of the subject contract] . . . in the economic development of
the country and the magnitude of the financial consideration involved.' We
concluded that, as a consequence, the disclosure provision in the
Constitution would constitute sufficient authority for upholding the
petitioner's standing.
Similarly, the instant petition is anchored on the right of the people to
information and access to official records, documents and papers — a right
guaranteed under Section 7, Article III of the 1987 Constitution. Petitioner, a
former solicitor general, is a Filipino citizen. Because of the satisfaction of the
two basic requisites laid down by decisional law to sustain petitioner's legal
standing, i.e. (1) the enforcement of a public right (2) espoused by a Filipino
citizen, we rule that the petition at bar should be allowed."
We rule that since the instant petition, brought by a citizen, involves the
enforcement of constitutional rights - to information and to the equitable
diffusion of natural resources - matters of transcendental public importance,
the petitioner has the requisite locus standi.
Fifth issue: whether the constitutional right to information includes official
information on on-going negotiations before a final agreement.
Section 7, Article III of the Constitution explains the people's right to
information on matters of public concern in this manner:
"Sec. 7. The right of the people to information on matters of public concern
shall be recognized. Access to official records, and to documents, and
papers pertaining to official acts, transactions, or decisions, as well as to
government research data used as basis for policy development, shall be
afforded the citizen, subject to such limitations as may be provided by law."
(Emphasis supplied)
The State policy of full transparency in all transactions involving public
interest reinforces the people's right to information on matters of public
concern. This State policy is expressed in Section 28, Article II of the
Constitution, thus:
"Sec. 28. Subject to reasonable conditions prescribed by law, the State
adopts and implements a policy of full public disclosure of all its
transactions involving public interest." (Emphasis supplied)
These twin provisions of the Constitution seek to promote transparency in
policy-making and in the operations of the government, as well as provide
the people sufficient information to exercise effectively other constitutional
rights. These twin provisions are essential to the exercise of freedom of
expression. If the government does not disclose its official acts, transactions
and decisions to citizens, whatever citizens say, even if expressed without
any restraint, will be speculative and amount to nothing. These twin
provisions are also essential to hold public officials "at all times x x x
accountable to the people,"29 for unless citizens have the proper information,
they cannot hold public officials accountable for anything. Armed with the
right information, citizens can participate in public discussions leading to the
formulation of government policies and their effective implementation. An
informed citizenry is essential to the existence and proper functioning of any
democracy. As explained by the Court in Valmonte v. Belmonte, Jr.30 –
"An essential element of these freedoms is to keep open a continuing
dialogue or process of communication between the government and the
people. It is in the interest of the State that the channels for free political
discussion be maintained to the end that the government may perceive and
be responsive to the people's will. Yet, this open dialogue can be effective
only to the extent that the citizenry is informed and thus able to formulate its
will intelligently. Only when the participants in the discussion are aware of
the issues and have access to information relating thereto can such bear
fruit."
PEA asserts, citing Chavez v. PCGG,31 that in cases of on-going negotiations
the right to information is limited to "definite propositions of the
government." PEA maintains the right does not include access to "intra-
agency or inter-agency recommendations or communications during the
stage when common assertions are still in the process of being formulated or
are in the 'exploratory stage'."
Also, AMARI contends that petitioner cannot invoke the right at the pre-
decisional stage or before the closing of the transaction. To support its
contention, AMARI cites the following discussion in the 1986 Constitutional
Commission:
"Mr. Suarez. And when we say 'transactions' which should be distinguished
from contracts, agreements, or treaties or whatever, does the Gentleman
refer to the steps leading to the consummation of the contract, or does he
refer to the contract itself?
Mr. Ople: The 'transactions' used here, I suppose is generic and therefore, it
can cover both steps leading to a contract and already a consummated
contract, Mr. Presiding Officer.
Mr. Suarez: This contemplates inclusion of negotiations leading to the
consummation of the transaction.
Mr. Ople: Yes, subject only to reasonable safeguards on the national
interest.
Mr. Suarez: Thank you."32 (Emphasis supplied)
AMARI argues there must first be a consummated contract before petitioner
can invoke the right. Requiring government officials to reveal their
deliberations at the pre-decisional stage will degrade the quality of decision-
making in government agencies. Government officials will hesitate to express
their real sentiments during deliberations if there is immediate public
dissemination of their discussions, putting them under all kinds of pressure
before they decide.
We must first distinguish between information the law on public bidding
requires PEA to disclose publicly, and information the constitutional right to
information requires PEA to release to the public. Before the consummation
of the contract, PEA must, on its own and without demand from anyone,
disclose to the public matters relating to the disposition of its property.
These include the size, location, technical description and nature of the
property being disposed of, the terms and conditions of the disposition, the
parties qualified to bid, the minimum price and similar information. PEA must
prepare all these data and disclose them to the public at the start of the
disposition process, long before the consummation of the contract, because
the Government Auditing Code requires public bidding. If PEA fails to make
this disclosure, any citizen can demand from PEA this information at any time
during the bidding process.
Information, however, on on-going evaluation or review of bids or proposals
being undertaken by the bidding or review committee is not immediately
accessible under the right to information. While the evaluation or review is
still on-going, there are no "official acts, transactions, or decisions" on the
bids or proposals. However, once the committee makes its official
recommendation, there arises a "definite proposition" on the part of the
government. From this moment, the public's right to information attaches,
and any citizen can access all the non-proprietary information leading to such
definite proposition. In Chavez v. PCGG,33 the Court ruled as follows:
"Considering the intent of the framers of the Constitution, we believe that it
is incumbent upon the PCGG and its officers, as well as other government
representatives, to disclose sufficient public information on any proposed
settlement they have decided to take up with the ostensible owners and
holders of ill-gotten wealth. Such information, though, must pertain
to definite propositions of the government, not necessarily to intra-agency
or inter-agency recommendations or communications during the stage when
common assertions are still in the process of being formulated or are in the
"exploratory" stage. There is need, of course, to observe the same
restrictions on disclosure of information in general, as discussed earlier –
such as on matters involving national security, diplomatic or foreign relations,
intelligence and other classified information." (Emphasis supplied)
Contrary to AMARI's contention, the commissioners of the 1986
Constitutional Commission understood that the right to
information "contemplates inclusion of negotiations leading to the
consummation of the transaction." Certainly, a consummated contract is not
a requirement for the exercise of the right to information. Otherwise, the
people can never exercise the right if no contract is consummated, and if one
is consummated, it may be too late for the public to expose its
defects.1âwphi1.nêt
Requiring a consummated contract will keep the public in the dark until the
contract, which may be grossly disadvantageous to the government or even
illegal, becomes a fait accompli. This negates the State policy of full
transparency on matters of public concern, a situation which the framers of
the Constitution could not have intended. Such a requirement will prevent
the citizenry from participating in the public discussion of
any proposed contract, effectively truncating a basic right enshrined in the
Bill of Rights. We can allow neither an emasculation of a constitutional right,
nor a retreat by the State of its avowed "policy of full disclosure of all its
transactions involving public interest."
The right covers three categories of information which are "matters of public
concern," namely: (1) official records; (2) documents and papers pertaining
to official acts, transactions and decisions; and (3) government research data
used in formulating policies. The first category refers to any document that is
part of the public records in the custody of government agencies or officials.
The second category refers to documents and papers recording, evidencing,
establishing, confirming, supporting, justifying or explaining official acts,
transactions or decisions of government agencies or officials. The third
category refers to research data, whether raw, collated or processed, owned
by the government and used in formulating government policies.
The information that petitioner may access on the renegotiation of the JVA
includes evaluation reports, recommendations, legal and expert opinions,
minutes of meetings, terms of reference and other documents attached to
such reports or minutes, all relating to the JVA. However, the right to
information does not compel PEA to prepare lists, abstracts, summaries and
the like relating to the renegotiation of the JVA.34 The right only affords
access to records, documents and papers, which means the opportunity to
inspect and copy them. One who exercises the right must copy the records,
documents and papers at his expense. The exercise of the right is also subject
to reasonable regulations to protect the integrity of the public records and to
minimize disruption to government operations, like rules specifying when
and how to conduct the inspection and copying.35
The right to information, however, does not extend to matters recognized as
privileged information under the separation of powers.36 The right does not
also apply to information on military and diplomatic secrets, information
affecting national security, and information on investigations of crimes by law
enforcement agencies before the prosecution of the accused, which courts
have long recognized as confidential.37 The right may also be subject to other
limitations that Congress may impose by law.
There is no claim by PEA that the information demanded by petitioner is
privileged information rooted in the separation of powers. The information
does not cover Presidential conversations, correspondences, or discussions
during closed-door Cabinet meetings which, like internal deliberations of the
Supreme Court and other collegiate courts, or executive sessions of either
house of Congress,38 are recognized as confidential. This kind of information
cannot be pried open by a co-equal branch of government. A frank exchange
of exploratory ideas and assessments, free from the glare of publicity and
pressure by interested parties, is essential to protect the independence of
decision-making of those tasked to exercise Presidential, Legislative and
Judicial power.39 This is not the situation in the instant case.
We rule, therefore, that the constitutional right to information includes
official information on on-going negotiations before a final contract. The
information, however, must constitute definite propositions by the
government and should not cover recognized exceptions like privileged
information, military and diplomatic secrets and similar matters affecting
national security and public order.40 Congress has also prescribed other
limitations on the right to information in several legislations. 41
Sixth issue: whether stipulations in the Amended JVA for the transfer to
AMARI of lands, reclaimed or to be reclaimed, violate the Constitution.
The Regalian Doctrine
The ownership of lands reclaimed from foreshore and submerged areas is
rooted in the Regalian doctrine which holds that the State owns all lands and
waters of the public domain. Upon the Spanish conquest of the Philippines,
ownership of all "lands, territories and possessions" in the Philippines passed
to the Spanish Crown.42 The King, as the sovereign ruler and representative of
the people, acquired and owned all lands and territories in the Philippines
except those he disposed of by grant or sale to private individuals.
The 1935, 1973 and 1987 Constitutions adopted the Regalian doctrine
substituting, however, the State, in lieu of the King, as the owner of all lands
and waters of the public domain. The Regalian doctrine is the foundation of
the time-honored principle of land ownership that "all lands that were not
acquired from the Government, either by purchase or by grant, belong to the
public domain."43 Article 339 of the Civil Code of 1889, which is now Article
420 of the Civil Code of 1950, incorporated the Regalian doctrine.
Ownership and Disposition of Reclaimed Lands
The Spanish Law of Waters of 1866 was the first statutory law governing the
ownership and disposition of reclaimed lands in the Philippines. On May 18,
1907, the Philippine Commission enacted Act No. 1654 which provided for
the lease, but not the sale, of reclaimed lands of the government to
corporations and individuals. Later, on November 29, 1919, the Philippine
Legislature approved Act No. 2874, the Public Land Act, which authorized the
lease, but not the sale, of reclaimed lands of the government to
corporations and individuals. On November 7, 1936, the National Assembly
passed Commonwealth Act No. 141, also known as the Public Land Act,
which authorized the lease, but not the sale, of reclaimed lands of the
government to corporations and individuals. CA No. 141 continues to this
day as the general law governing the classification and disposition of lands of
the public domain.
The Spanish Law of Waters of 1866 and the Civil Code of 1889
Under the Spanish Law of Waters of 1866, the shores, bays, coves, inlets and
all waters within the maritime zone of the Spanish territory belonged to the
public domain for public use.44 The Spanish Law of Waters of 1866 allowed
the reclamation of the sea under Article 5, which provided as follows:
"Article 5. Lands reclaimed from the sea in consequence of works
constructed by the State, or by the provinces, pueblos or private persons,
with proper permission, shall become the property of the party constructing
such works, unless otherwise provided by the terms of the grant of
authority."
Under the Spanish Law of Waters, land reclaimed from the sea belonged to
the party undertaking the reclamation, provided the government issued the
necessary permit and did not reserve ownership of the reclaimed land to the
State.
Article 339 of the Civil Code of 1889 defined property of public dominion as
follows:
"Art. 339. Property of public dominion is –
1. That devoted to public use, such as roads, canals, rivers, torrents, ports
and bridges constructed by the State, riverbanks, shores, roadsteads, and
that of a similar character;
2. That belonging exclusively to the State which, without being of general
public use, is employed in some public service, or in the development of the
national wealth, such as walls, fortresses, and other works for the defense of
the territory, and mines, until granted to private individuals."
Property devoted to public use referred to property open for use by the
public. In contrast, property devoted to public service referred to property
used for some specific public service and open only to those authorized to
use the property.
Property of public dominion referred not only to property devoted to public
use, but also to property not so used but employed to develop the national
wealth. This class of property constituted property of public dominion
although employed for some economic or commercial activity to increase the
national wealth.
Article 341 of the Civil Code of 1889 governed the re-classification of
property of public dominion into private property, to wit:
"Art. 341. Property of public dominion, when no longer devoted to public use
or to the defense of the territory, shall become a part of the private property
of the State."
This provision, however, was not self-executing. The legislature, or the
executive department pursuant to law, must declare the property no longer
needed for public use or territorial defense before the government could
lease or alienate the property to private parties.45
Act No. 1654 of the Philippine Commission
On May 8, 1907, the Philippine Commission enacted Act No. 1654 which
regulated the lease of reclaimed and foreshore lands. The salient provisions
of this law were as follows:
"Section 1. The control and disposition of the foreshore as defined in existing
law, and the title to all Government or public lands made or reclaimed by
the Government by dredging or filling or otherwise throughout the
Philippine Islands, shall be retained by the Government without prejudice to
vested rights and without prejudice to rights conceded to the City of Manila
in the Luneta Extension.
Section 2. (a) The Secretary of the Interior shall cause all Government or
public lands made or reclaimed by the Government by dredging or filling or
otherwise to be divided into lots or blocks, with the necessary streets and
alleyways located thereon, and shall cause plats and plans of such surveys to
be prepared and filed with the Bureau of Lands.
(b) Upon completion of such plats and plans the Governor-General shall give
notice to the public that such parts of the lands so made or reclaimed as are
not needed for public purposes will be leased for commercial and business
purposes, x x x.
xxx
(e) The leases above provided for shall be disposed of to the highest and
best bidder therefore, subject to such regulations and safeguards as the
Governor-General may by executive order prescribe." (Emphasis supplied)
Act No. 1654 mandated that the government should retain title to all lands
reclaimed by the government. The Act also vested in the government control
and disposition of foreshore lands. Private parties could lease lands
reclaimed by the government only if these lands were no longer needed for
public purpose. Act No. 1654 mandated public bidding in the lease of
government reclaimed lands. Act No. 1654 made government reclaimed
lands sui generis in that unlike other public lands which the government
could sell to private parties, these reclaimed lands were available only for
lease to private parties.
Act No. 1654, however, did not repeal Section 5 of the Spanish Law of Waters
of 1866. Act No. 1654 did not prohibit private parties from reclaiming parts
of the sea under Section 5 of the Spanish Law of Waters. Lands reclaimed
from the sea by private parties with government permission remained
private lands.
Act No. 2874 of the Philippine Legislature
On November 29, 1919, the Philippine Legislature enacted Act No. 2874, the
Public Land Act.46 The salient provisions of Act No. 2874, on reclaimed lands,
were as follows:
"Sec. 6. The Governor-General, upon the recommendation of the Secretary
of Agriculture and Natural Resources, shall from time to time classify the
lands of the public domain into –
(a) Alienable or disposable,
(b) Timber, and
(c) Mineral lands, x x x.
Sec. 7. For the purposes of the government and disposition of alienable or
disposable public lands, the Governor-General, upon recommendation by
the Secretary of Agriculture and Natural Resources, shall from time to time
declare what lands are open to disposition or concession under this Act."
Sec. 8. Only those lands shall be declared open to disposition or concession
which have been officially delimited or classified x x x.
xxx
Sec. 55. Any tract of land of the public domain which, being neither timber
nor mineral land, shall be classified as suitable for residential purposes or for
commercial, industrial, or other productive purposes other than agricultural
purposes, and shall be open to disposition or concession, shall be disposed of
under the provisions of this chapter, and not otherwise.
Sec. 56. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the Government by dredging, filling, or other means;
(b) Foreshore;
(c) Marshy lands or lands covered with water bordering upon the shores or
banks of navigable lakes or rivers;
(d) Lands not included in any of the foregoing classes.
x x x.
Sec. 58. The lands comprised in classes (a), (b), and (c) of section fifty-six
shall be disposed of to private parties by lease only and not otherwise, as
soon as the Governor-General, upon recommendation by the Secretary of
Agriculture and Natural Resources, shall declare that the same are not
necessary for the public service and are open to disposition under this
chapter. The lands included in class (d) may be disposed of by sale or lease
under the provisions of this Act." (Emphasis supplied)
Section 6 of Act No. 2874 authorized the Governor-General to "classify lands
of the public domain into x x x alienable or disposable"47 lands. Section 7 of
the Act empowered the Governor-General to "declare what lands are open
to disposition or concession." Section 8 of the Act limited alienable or
disposable lands only to those lands which have been "officially delimited
and classified."
Section 56 of Act No. 2874 stated that lands "disposable under this
title48 shall be classified" as government reclaimed, foreshore and marshy
lands, as well as other lands. All these lands, however, must be suitable for
residential, commercial, industrial or other productive non-
agricultural purposes. These provisions vested upon the Governor-General
the power to classify inalienable lands of the public domain into disposable
lands of the public domain. These provisions also empowered the Governor-
General to classify further such disposable lands of the public domain into
government reclaimed, foreshore or marshy lands of the public domain, as
well as other non-agricultural lands.
Section 58 of Act No. 2874 categorically mandated that disposable lands of
the public domain classified as government reclaimed, foreshore and marshy
lands "shall be disposed of to private parties by lease only and not
otherwise." The Governor-General, before allowing the lease of these lands
to private parties, must formally declare that the lands were "not necessary
for the public service." Act No. 2874 reiterated the State policy to lease and
not to sell government reclaimed, foreshore and marshy lands of the public
domain, a policy first enunciated in 1907 in Act No. 1654. Government
reclaimed, foreshore and marshy lands remained sui generis, as the only
alienable or disposable lands of the public domain that the government could
not sell to private parties.
The rationale behind this State policy is obvious. Government reclaimed,
foreshore and marshy public lands for non-agricultural purposes retain their
inherent potential as areas for public service. This is the reason the
government prohibited the sale, and only allowed the lease, of these lands to
private parties. The State always reserved these lands for some future public
service.
Act No. 2874 did not authorize the reclassification of government reclaimed,
foreshore and marshy lands into other non-agricultural lands under Section
56 (d). Lands falling under Section 56 (d) were the only lands for non-
agricultural purposes the government could sell to private parties. Thus,
under Act No. 2874, the government could not sell government reclaimed,
foreshore and marshy lands to private parties, unless the legislature passed
a law allowing their sale.49
Act No. 2874 did not prohibit private parties from reclaiming parts of the sea
pursuant to Section 5 of the Spanish Law of Waters of 1866. Lands reclaimed
from the sea by private parties with government permission remained
private lands.
Dispositions under the 1935 Constitution
On May 14, 1935, the 1935 Constitution took effect upon its ratification by
the Filipino people. The 1935 Constitution, in adopting the Regalian doctrine,
declared in Section 1, Article XIII, that –
"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 limit of the grant." (Emphasis
supplied)
The 1935 Constitution barred the alienation of all natural resources except
public agricultural lands, which were the only natural resources the State
could alienate. Thus, foreshore lands, considered part of the State's natural
resources, became inalienable by constitutional fiat, available only for lease
for 25 years, renewable for another 25 years. The government could alienate
foreshore lands only after these lands were reclaimed and classified as
alienable agricultural lands of the public domain. Government reclaimed and
marshy lands of the public domain, being neither timber nor mineral lands,
fell under the classification of public agricultural lands.50 However,
government reclaimed and marshy lands, although subject to classification as
disposable public agricultural lands, could only be leased and not sold to
private parties because of Act No. 2874.
The prohibition on private parties from acquiring ownership of government
reclaimed and marshy lands of the public domain was only a statutory
prohibition and the legislature could therefore remove such prohibition. The
1935 Constitution did not prohibit individuals and corporations from
acquiring government reclaimed and marshy lands of the public domain that
were classified as agricultural lands under existing public land laws. Section 2,
Article XIII of the 1935 Constitution provided as follows:
"Section 2. No private corporation or association may acquire, lease, or
hold public agricultural lands in excess of one thousand and twenty four
hectares, nor may any individual acquire such lands by purchase in excess
of one hundred and forty hectares, or by lease in excess of one thousand
and twenty-four hectares, or by homestead in excess of twenty-four
hectares. Lands adapted to grazing, not exceeding two thousand hectares,
may be leased to an individual, private corporation, or association."
(Emphasis supplied)
Still, after the effectivity of the 1935 Constitution, the legislature did not
repeal Section 58 of Act No. 2874 to open for sale to private parties
government reclaimed and marshy lands of the public domain. On the
contrary, the legislature continued the long established State policy of
retaining for the government title and ownership of government reclaimed
and marshy lands of the public domain.
Commonwealth Act No. 141 of the Philippine National Assembly
On November 7, 1936, the National Assembly approved Commonwealth Act
No. 141, also known as the Public Land Act, which compiled the then existing
laws on lands of the public domain. CA No. 141, as amended, remains to this
day the existing general law governing the classification and disposition of
lands of the public domain other than timber and mineral lands.51
Section 6 of CA No. 141 empowers the President to classify lands of the
public domain into "alienable or disposable"52 lands of the public domain,
which prior to such classification are inalienable and outside the commerce
of man. Section 7 of CA No. 141 authorizes the President to "declare what
lands are open to disposition or concession." Section 8 of CA No. 141 states
that the government can declare open for disposition or concession only
lands that are "officially delimited and classified." Sections 6, 7 and 8 of CA
No. 141 read as follows:
"Sec. 6. The President, upon the recommendation of the Secretary of
Agriculture and Commerce, shall from time to time classify the lands of the
public domain into –
(a) Alienable or disposable,
(b) Timber, and
(c) Mineral lands,
and may at any time and in like manner transfer such lands from one class to
another,53 for the purpose of their administration and disposition.
Sec. 7. For the purposes of the administration and disposition of alienable or
disposable public lands, the President, upon recommendation by the
Secretary of Agriculture and Commerce, shall from time to time declare
what lands are open to disposition or concession under this Act.
Sec. 8. Only those lands shall be declared open to disposition or concession
which have been officially delimited and classified and, when practicable,
surveyed, and which have not been reserved for public or quasi-public uses,
nor appropriated by the Government, nor in any manner become private
property, nor those on which a private right authorized and recognized by
this Act or any other valid law may be claimed, or which, having been
reserved or appropriated, have ceased to be so. x x x."
Thus, before the government could alienate or dispose of lands of the public
domain, the President must first officially classify these lands as alienable or
disposable, and then declare them open to disposition or concession. There
must be no law reserving these lands for public or quasi-public uses.
The salient provisions of CA No. 141, on government reclaimed, foreshore
and marshy lands of the public domain, are as follows:
"Sec. 58. Any tract of land of the public domain which, being neither timber
nor mineral land, is intended to be used for residential purposes or for
commercial, industrial, or other productive purposes other than
agricultural, and is open to disposition or concession, shall be disposed of
under the provisions of this chapter and not otherwise.
Sec. 59. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the Government by dredging, filling, or other
means;
(b) Foreshore;
(c) Marshy lands or lands covered with water bordering upon the shores or
banks of navigable lakes or rivers;
(d) Lands not included in any of the foregoing classes.
Sec. 60. Any tract of land comprised under this title may be leased or sold, as
the case may be, to any person, corporation, or association authorized to
purchase or lease public lands for agricultural purposes. x x x.
Sec. 61. The lands comprised in classes (a), (b), and (c) of section fifty-nine
shall be disposed of to private parties by lease only and not otherwise, as
soon as the President, upon recommendation by the Secretary of
Agriculture, shall declare that the same are not necessary for the public
service and are open to disposition under this chapter. The lands included in
class (d) may be disposed of by sale or lease under the provisions of this
Act." (Emphasis supplied)
Section 61 of CA No. 141 readopted, after the effectivity of the 1935
Constitution, Section 58 of Act No. 2874 prohibiting the sale of government
reclaimed, foreshore and marshy disposable lands of the public domain. All
these lands are intended for residential, commercial, industrial or other non-
agricultural purposes. As before, Section 61 allowed only the lease of such
lands to private parties. The government could sell to private parties only
lands falling under Section 59 (d) of CA No. 141, or those lands for non-
agricultural purposes not classified as government reclaimed, foreshore and
marshy disposable lands of the public domain. Foreshore lands, however,
became inalienable under the 1935 Constitution which only allowed the
lease of these lands to qualified private parties.
Section 58 of CA No. 141 expressly states that disposable lands of the public
domain intended for residential, commercial, industrial or other productive
purposes other than agricultural "shall be disposed of under the provisions
of this chapter and not otherwise." Under Section 10 of CA No. 141, the term
"disposition" includes lease of the land. Any disposition of government
reclaimed, foreshore and marshy disposable lands for non-agricultural
purposes must comply with Chapter IX, Title III of CA No. 141,54 unless a
subsequent law amended or repealed these provisions.
In his concurring opinion in the landmark case of Republic Real Estate
Corporation v. Court of Appeals,55 Justice Reynato S. Puno summarized
succinctly the law on this matter, as follows:
"Foreshore lands are lands of public dominion intended for public use. So too
are lands reclaimed by the government by dredging, filling, or other means.
Act 1654 mandated that the control and disposition of the foreshore and
lands under water remained in the national government. Said law allowed
only the 'leasing' of reclaimed land. The Public Land Acts of 1919 and 1936
also declared that the foreshore and lands reclaimed by the government
were to be "disposed of to private parties by lease only and not otherwise."
Before leasing, however, the Governor-General, upon recommendation of
the Secretary of Agriculture and Natural Resources, had first to determine
that the land reclaimed was not necessary for the public service. This
requisite must have been met before the land could be disposed of. But even
then, the foreshore and lands under water were not to be alienated and
sold to private parties. The disposition of the reclaimed land was only by
lease. The land remained property of the State." (Emphasis supplied)
As observed by Justice Puno in his concurring opinion, "Commonwealth Act
No. 141 has remained in effect at present."
The State policy prohibiting the sale to private parties of government
reclaimed, foreshore and marshy alienable lands of the public domain, first
implemented in 1907 was thus reaffirmed in CA No. 141 after the 1935
Constitution took effect. The prohibition on the sale of foreshore lands,
however, became a constitutional edict under the 1935 Constitution.
Foreshore lands became inalienable as natural resources of the State, unless
reclaimed by the government and classified as agricultural lands of the public
domain, in which case they would fall under the classification of government
reclaimed lands.
After the effectivity of the 1935 Constitution, government reclaimed and
marshy disposable lands of the public domain continued to be only leased
and not sold to private parties.56 These lands remained sui generis, as the
only alienable or disposable lands of the public domain the government
could not sell to private parties.
Since then and until now, the only way the government can sell to private
parties government reclaimed and marshy disposable lands of the public
domain is for the legislature to pass a law authorizing such sale. CA No. 141
does not authorize the President to reclassify government reclaimed and
marshy lands into other non-agricultural lands under Section 59 (d). Lands
classified under Section 59 (d) are the only alienable or disposable lands for
non-agricultural purposes that the government could sell to private parties.
Moreover, Section 60 of CA No. 141 expressly requires congressional
authority before lands under Section 59 that the government previously
transferred to government units or entities could be sold to private parties.
Section 60 of CA No. 141 declares that –
"Sec. 60. x x x The area so leased or sold shall be such as shall, in the
judgment of the Secretary of Agriculture and Natural Resources, be
reasonably necessary for the purposes for which such sale or lease is
requested, and shall not exceed one hundred and forty-four hectares:
Provided, however, That this limitation shall not apply to grants, donations,
or transfers made to a province, municipality or branch or subdivision of the
Government for the purposes deemed by said entities conducive to the
public interest; but the land so granted, donated, or transferred to a
province, municipality or branch or subdivision of the Government shall not
be alienated, encumbered, or otherwise disposed of in a manner affecting
its title, except when authorized by Congress: x x x." (Emphasis supplied)
The congressional authority required in Section 60 of CA No. 141 mirrors the
legislative authority required in Section 56 of Act No. 2874.
One reason for the congressional authority is that Section 60 of CA No. 141
exempted government units and entities from the maximum area of public
lands that could be acquired from the State. These government units and
entities should not just turn around and sell these lands to private parties in
violation of constitutional or statutory limitations. Otherwise, the transfer of
lands for non-agricultural purposes to government units and entities could be
used to circumvent constitutional limitations on ownership of alienable or
disposable lands of the public domain. In the same manner, such transfers
could also be used to evade the statutory prohibition in CA No. 141 on the
sale of government reclaimed and marshy lands of the public domain to
private parties. Section 60 of CA No. 141 constitutes by operation of law a
lien on these lands.57
In case of sale or lease of disposable lands of the public domain falling under
Section 59 of CA No. 141, Sections 63 and 67 require a public bidding.
Sections 63 and 67 of CA No. 141 provide as follows:
"Sec. 63. Whenever it is decided that lands covered by this chapter are not
needed for public purposes, the Director of Lands shall ask the Secretary of
Agriculture and Commerce (now the Secretary of Natural Resources) for
authority to dispose of the same. Upon receipt of such authority, the Director
of Lands shall give notice by public advertisement in the same manner as in
the case of leases or sales of agricultural public land, x x x.
Sec. 67. The lease or sale shall be made by oral bidding; and adjudication
shall be made to the highest bidder. x x x." (Emphasis supplied)
Thus, CA No. 141 mandates the Government to put to public auction all
leases or sales of alienable or disposable lands of the public domain.58
Like Act No. 1654 and Act No. 2874 before it, CA No. 141 did not repeal
Section 5 of the Spanish Law of Waters of 1866. Private parties could still
reclaim portions of the sea with government permission. However,
the reclaimed land could become private land only if classified as alienable
agricultural land of the public domain open to disposition under CA No. 141.
The 1935 Constitution prohibited the alienation of all natural resources
except public agricultural lands.
The Civil Code of 1950
The Civil Code of 1950 readopted substantially the definition of property of
public dominion found in the Civil Code of 1889. Articles 420 and 422 of the
Civil Code of 1950 state that –
"Art. 420. The following things are property of public dominion:
(1) Those intended for public use, such as roads, canals, rivers, torrents, ports
and bridges constructed by the State, banks, shores, roadsteads, and others
of similar character;
(2) Those which belong to the State, without being for public use, and are
intended for some public service or for the development of the national
wealth.
x x x.
Art. 422. Property of public dominion, when no longer intended for public
use or for public service, shall form part of the patrimonial property of the
State."
Again, the government must formally declare that the property of public
dominion is no longer needed for public use or public service, before the
same could be classified as patrimonial property of the State.59 In the case of
government reclaimed and marshy lands of the public domain, the
declaration of their being disposable, as well as the manner of their
disposition, is governed by the applicable provisions of CA No. 141.
Like the Civil Code of 1889, the Civil Code of 1950 included as property of
public dominion those properties of the State which, without being for public
use, are intended for public service or the "development of the national
wealth." Thus, government reclaimed and marshy lands of the State, even if
not employed for public use or public service, if developed to enhance the
national wealth, are classified as property of public dominion.
Dispositions under the 1973 Constitution
The 1973 Constitution, which took effect on January 17, 1973, likewise
adopted the Regalian doctrine. Section 8, Article XIV of the 1973 Constitution
stated that –
"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." (Emphasis supplied)
The 1973 Constitution prohibited the alienation of all natural resources with
the exception of "agricultural, industrial or commercial, residential, and
resettlement lands of the public domain." In contrast, the 1935 Constitution
barred the alienation of all natural resources except "public agricultural
lands." However, the term "public agricultural lands" in the 1935 Constitution
encompassed industrial, commercial, residential and resettlement lands of
the public domain.60 If the land of public domain were neither timber nor
mineral land, it would fall under the classification of agricultural land of the
public domain. Both the 1935 and 1973 Constitutions, therefore, prohibited
the alienation of all natural resources except agricultural lands of the
public domain.
The 1973 Constitution, however, limited the alienation of lands of the public
domain to individuals who were citizens of the Philippines. Private
corporations, even if wholly owned by Philippine citizens, were no longer
allowed to acquire alienable lands of the public domain unlike in the 1935
Constitution. Section 11, Article XIV of the 1973 Constitution declared that –
"Sec. 11. The Batasang Pambansa, taking into account conservation,
ecological, and development requirements of the natural resources, shall
determine by law the size of land of the public domain which may be
developed, held or acquired by, or leased to, any qualified individual,
corporation, or association, and the conditions therefor. No private
corporation or association may hold alienable lands of the public domain
except by lease not to exceed one thousand hectares in area nor may any
citizen hold such lands by lease in excess of five hundred hectares or acquire
by purchase, homestead or grant, in excess of twenty-four hectares. No
private corporation or association may hold by lease, concession, license or
permit, timber or forest lands and other timber or forest resources in excess
of one hundred thousand hectares. However, such area may be increased by
the Batasang Pambansa upon recommendation of the National Economic
and Development Authority." (Emphasis supplied)
Thus, under the 1973 Constitution, private corporations could hold alienable
lands of the public domain only through lease. Only individuals could now
acquire alienable lands of the public domain, and private corporations
became absolutely barred from acquiring any kind of alienable land of the
public domain. The constitutional ban extended to all kinds of alienable lands
of the public domain, while the statutory ban under CA No. 141 applied only
to government reclaimed, foreshore and marshy alienable lands of the public
domain.
PD No. 1084 Creating the Public Estates Authority
On February 4, 1977, then President Ferdinand Marcos issued Presidential
Decree No. 1084 creating PEA, a wholly government owned and controlled
corporation with a special charter. Sections 4 and 8 of PD No. 1084, vests PEA
with the following purposes and powers:
"Sec. 4. Purpose. The Authority is hereby created for the following purposes:
(a) To reclaim land, including foreshore and submerged areas, by dredging,
filling or other means, or to acquire reclaimed land;
(b) To develop, improve, acquire, administer, deal in, subdivide,
dispose, lease and sell any and all kinds of lands, buildings, estates and
other forms of real property, owned, managed, controlled and/or operated
by the government;
(c) To provide for, operate or administer such service as may be necessary for
the efficient, economical and beneficial utilization of the above properties.
Sec. 5. Powers and functions of the Authority. The Authority shall, in carrying
out the purposes for which it is created, have the following powers and
functions:
(a)To prescribe its by-laws.
xxx
(i) To hold lands of the public domain in excess of the area permitted to
private corporations by statute.
(j) To reclaim lands and to construct work across, or otherwise, any stream,
watercourse, canal, ditch, flume x x x.
xxx
(o) To perform such acts and exercise such functions as may be necessary for
the attainment of the purposes and objectives herein specified." (Emphasis
supplied)
PD No. 1084 authorizes PEA to reclaim both foreshore and submerged areas
of the public domain. Foreshore areas are those covered and uncovered by
the ebb and flow of the tide.61 Submerged areas are those permanently
under water regardless of the ebb and flow of the tide.62 Foreshore and
submerged areas indisputably belong to the public domain63 and are
inalienable unless reclaimed, classified as alienable lands open to disposition,
and further declared no longer needed for public service.
The ban in the 1973 Constitution on private corporations from acquiring
alienable lands of the public domain did not apply to PEA since it was then,
and until today, a fully owned government corporation. The constitutional
ban applied then, as it still applies now, only to "private corporations and
associations." PD No. 1084 expressly empowers PEA "to hold lands of the
public domain" even "in excess of the area permitted to private corporations
by statute." Thus, PEA can hold title to private lands, as well as title to lands
of the public domain.
In order for PEA to sell its reclaimed foreshore and submerged alienable
lands of the public domain, there must be legislative authority empowering
PEA to sell these lands. This legislative authority is necessary in view of
Section 60 of CA No.141, which states –
"Sec. 60. x x x; but the land so granted, donated or transferred to a province,
municipality, or branch or subdivision of the Government shall not be
alienated, encumbered or otherwise disposed of in a manner affecting its
title, except when authorized by Congress; x x x." (Emphasis supplied)
Without such legislative authority, PEA could not sell but only lease its
reclaimed foreshore and submerged alienable lands of the public domain.
Nevertheless, any legislative authority granted to PEA to sell its reclaimed
alienable lands of the public domain would be subject to the constitutional
ban on private corporations from acquiring alienable lands of the public
domain. Hence, such legislative authority could only benefit private
individuals.
Dispositions under the 1987 Constitution
The 1987 Constitution, like the 1935 and 1973 Constitutions before it, has
adopted the Regalian doctrine. The 1987 Constitution declares that all
natural resources are "owned by the State," and except for alienable
agricultural lands of the public domain, natural resources cannot be
alienated. Sections 2 and 3, Article XII of the 1987 Constitution state that –
"Section 2. All lands of the public domain, waters, minerals, coal, petroleum
and other mineral oils, all forces of potential energy, fisheries, forests or
timber, wildlife, flora and fauna, and other natural resources are owned by
the State. With the exception of agricultural lands, all other natural
resources shall not be alienated. The exploration, development, and
utilization of natural resources shall be under the full control and supervision
of the State. x x x.
Section 3. Lands of the public domain are classified into agricultural, forest or
timber, mineral lands, and national parks. Agricultural lands of the public
domain may be further classified by law according to the uses which they
may be devoted. Alienable lands of the public domain shall be limited to
agricultural lands. Private corporations or associations may not hold such
alienable lands of the public domain except by lease, for a period not
exceeding twenty-five years, renewable for not more than twenty-five
years, and not to exceed one thousand hectares in area. Citizens of the
Philippines may lease not more than five hundred hectares, or acquire not
more than twelve hectares thereof by purchase, homestead, or grant.
Taking into account the requirements of conservation, ecology, and
development, and subject to the requirements of agrarian reform, the
Congress shall determine, by law, the size of lands of the public domain
which may be acquired, developed, held, or leased and the conditions
therefor." (Emphasis supplied)
The 1987 Constitution continues the State policy in the 1973 Constitution
banning private corporations from acquiring any kind of alienable land of
the public domain. Like the 1973 Constitution, the 1987 Constitution allows
private corporations to hold alienable lands of the public domain only
through lease. As in the 1935 and 1973 Constitutions, the general law
governing the lease to private corporations of reclaimed, foreshore and
marshy alienable lands of the public domain is still CA No. 141.
The Rationale behind the Constitutional Ban
The rationale behind the constitutional ban on corporations from acquiring,
except through lease, alienable lands of the public domain is not well
understood. During the deliberations of the 1986 Constitutional Commission,
the commissioners probed the rationale behind this ban, thus:
"FR. BERNAS: Mr. Vice-President, my questions have reference to page 3, line
5 which says:
`No private corporation or association may hold alienable lands of the public
domain except by lease, not to exceed one thousand hectares in area.'
If we recall, this provision did not exist under the 1935 Constitution, but this
was introduced in the 1973 Constitution. In effect, it prohibits private
corporations from acquiring alienable public lands. But it has not been very
clear in jurisprudence what the reason for this is. In some of the cases
decided in 1982 and 1983, it was indicated that the purpose of this is to
prevent large landholdings. Is that the intent of this provision?
MR. VILLEGAS: I think that is the spirit of the provision.
FR. BERNAS: In existing decisions involving the Iglesia ni Cristo, there were
instances where the Iglesia ni Cristo was not allowed to acquire a mere 313-
square meter land where a chapel stood because the Supreme Court said it
would be in violation of this." (Emphasis supplied)
In Ayog v. Cusi,64 the Court explained the rationale behind this constitutional
ban in this way:
"Indeed, one purpose of the constitutional prohibition against purchases of
public agricultural lands by private corporations is to equitably diffuse land
ownership or to encourage 'owner-cultivatorship and the economic family-
size farm' and to prevent a recurrence of cases like the instant case. Huge
landholdings by corporations or private persons had spawned social unrest."
However, if the constitutional intent is to prevent huge landholdings, the
Constitution could have simply limited the size of alienable lands of the
public domain that corporations could acquire. The Constitution could have
followed the limitations on individuals, who could acquire not more than 24
hectares of alienable lands of the public domain under the 1973 Constitution,
and not more than 12 hectares under the 1987 Constitution.
If the constitutional intent is to encourage economic family-size farms,
placing the land in the name of a corporation would be more effective in
preventing the break-up of farmlands. If the farmland is registered in the
name of a corporation, upon the death of the owner, his heirs would inherit
shares in the corporation instead of subdivided parcels of the farmland. This
would prevent the continuing break-up of farmlands into smaller and smaller
plots from one generation to the next.
In actual practice, the constitutional ban strengthens the constitutional
limitation on individuals from acquiring more than the allowed area of
alienable lands of the public domain. Without the constitutional ban,
individuals who already acquired the maximum area of alienable lands of the
public domain could easily set up corporations to acquire more alienable
public lands. An individual could own as many corporations as his means
would allow him. An individual could even hide his ownership of a
corporation by putting his nominees as stockholders of the corporation. The
corporation is a convenient vehicle to circumvent the constitutional
limitation on acquisition by individuals of alienable lands of the public
domain.
The constitutional intent, under the 1973 and 1987 Constitutions, is to
transfer ownership of only a limited area of alienable land of the public
domain to a qualified individual. This constitutional intent is safeguarded by
the provision prohibiting corporations from acquiring alienable lands of the
public domain, since the vehicle to circumvent the constitutional intent is
removed. The available alienable public lands are gradually decreasing in the
face of an ever-growing population. The most effective way to insure faithful
adherence to this constitutional intent is to grant or sell alienable lands of
the public domain only to individuals. This, it would seem, is the practical
benefit arising from the constitutional ban.
The Amended Joint Venture Agreement
The subject matter of the Amended JVA, as stated in its second Whereas
clause, consists of three properties, namely:
1. "[T]hree partially reclaimed and substantially eroded islands along Emilio
Aguinaldo Boulevard in Paranaque and Las Pinas, Metro Manila, with a
combined titled area of 1,578,441 square meters;"
2. "[A]nother area of 2,421,559 square meters contiguous to the three
islands;" and
3. "[A]t AMARI's option as approved by PEA, an additional 350 hectares more
or less to regularize the configuration of the reclaimed area."65
PEA confirms that the Amended JVA involves "the development of the
Freedom Islands and further reclamation of about 250 hectares x x x," plus
an option "granted to AMARI to subsequently reclaim another 350 hectares x
x x."66
In short, the Amended JVA covers a reclamation area of 750 hectares. Only
157.84 hectares of the 750-hectare reclamation project have been
reclaimed, and the rest of the 592.15 hectares are still submerged areas
forming part of Manila Bay.
Under the Amended JVA, AMARI will reimburse PEA the sum of
P1,894,129,200.00 for PEA's "actual cost" in partially reclaiming the Freedom
Islands. AMARI will also complete, at its own expense, the reclamation of the
Freedom Islands. AMARI will further shoulder all the reclamation costs of all
the other areas, totaling 592.15 hectares, still to be reclaimed. AMARI and
PEA will share, in the proportion of 70 percent and 30 percent, respectively,
the total net usable area which is defined in the Amended JVA as the total
reclaimed area less 30 percent earmarked for common areas. Title to
AMARI's share in the net usable area, totaling 367.5 hectares, will be issued
in the name of AMARI. Section 5.2 (c) of the Amended JVA provides that –
"x x x, PEA shall have the duty to execute without delay the necessary deed
of transfer or conveyance of the title pertaining to AMARI's Land share based
on the Land Allocation Plan. PEA, when requested in writing by AMARI, shall
then cause the issuance and delivery of the proper certificates of title
covering AMARI's Land Share in the name of AMARI, x x x; provided, that if
more than seventy percent (70%) of the titled area at any given time pertains
to AMARI, PEA shall deliver to AMARI only seventy percent (70%) of the titles
pertaining to AMARI, until such time when a corresponding proportionate
area of additional land pertaining to PEA has been titled." (Emphasis
supplied)
Indisputably, under the Amended JVA AMARI will acquire and own a
maximum of 367.5 hectares of reclaimed land which will be titled in its
name.
To implement the Amended JVA, PEA delegated to the unincorporated PEA-
AMARI joint venture PEA's statutory authority, rights and privileges to
reclaim foreshore and submerged areas in Manila Bay. Section 3.2.a of the
Amended JVA states that –
"PEA hereby contributes to the joint venture its rights and privileges to
perform Rawland Reclamation and Horizontal Development as well as own
the Reclamation Area, thereby granting the Joint Venture the full and
exclusive right, authority and privilege to undertake the Project in
accordance with the Master Development Plan."
The Amended JVA is the product of a renegotiation of the original JVA dated
April 25, 1995 and its supplemental agreement dated August 9, 1995.
The Threshold Issue
The threshold issue is whether AMARI, a private corporation, can acquire and
own under the Amended JVA 367.5 hectares of reclaimed foreshore and
submerged areas in Manila Bay in view of Sections 2 and 3, Article XII of the
1987 Constitution which state that:
"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. x x x.
xxx
Section 3. x x x Alienable lands of the public domain shall be limited to
agricultural lands. Private corporations or associations may not hold such
alienable lands of the public domain except by lease, x x x."(Emphasis
supplied)
Classification of Reclaimed Foreshore and Submerged Areas
PEA readily concedes that lands reclaimed from foreshore or submerged
areas of Manila Bay are alienable or disposable lands of the public domain. In
its Memorandum,67 PEA admits that –
"Under the Public Land Act (CA 141, as amended), reclaimed lands are
classified as alienable and disposable lands of the public domain:
'Sec. 59. The lands disposable under this title shall be classified as follows:
(a) Lands reclaimed by the government by dredging, filling, or other means;
x x x.'" (Emphasis supplied)
Likewise, the Legal Task Force68 constituted under Presidential Administrative
Order No. 365 admitted in its Report and Recommendation to then President
Fidel V. Ramos, "[R]eclaimed lands are classified as alienable and
disposable lands of the public domain."69 The Legal Task Force concluded
that –
"D. Conclusion
Reclaimed lands are lands of the public domain. However, by statutory
authority, the rights of ownership and disposition over reclaimed lands have
been transferred to PEA, by virtue of which PEA, as owner, may validly
convey the same to any qualified person without violating the Constitution or
any statute.
The constitutional provision prohibiting private corporations from holding
public land, except by lease (Sec. 3, Art. XVII,70 1987 Constitution), does not
apply to reclaimed lands whose ownership has passed on to PEA by statutory
grant."
Under Section 2, Article XII of the 1987 Constitution, the foreshore and
submerged areas of Manila Bay are part of the "lands of the public domain,
waters x x x and other natural resources" and consequently "owned by the
State." As such, foreshore and submerged areas "shall not be alienated,"
unless they are classified as "agricultural lands" of the public domain. The
mere reclamation of these areas by PEA does not convert these inalienable
natural resources of the State into alienable or disposable lands of the public
domain. There must be a law or presidential proclamation officially
classifying these reclaimed lands as alienable or disposable and open to
disposition or concession. Moreover, these reclaimed lands cannot be
classified as alienable or disposable if the law has reserved them for some
public or quasi-public use.71
Section 8 of CA No. 141 provides that "only those lands shall be declared
open to disposition or concession which have been officially delimited and
classified."72 The President has the authority to classify inalienable lands of
the public domain into alienable or disposable lands of the public domain,
pursuant to Section 6 of CA No. 141. In Laurel vs. Garcia,73 the Executive
Department attempted to sell the Roppongi property in Tokyo, Japan, which
was acquired by the Philippine Government for use as the Chancery of the
Philippine Embassy. Although the Chancery had transferred to another
location thirteen years earlier, the Court still ruled that, under Article 42274 of
the Civil Code, a property of public dominion retains such character until
formally declared otherwise. The Court ruled that –
"The fact that the Roppongi site has not been used for a long time for actual
Embassy service does not automatically convert it to patrimonial property.
Any such conversion happens only if the property is withdrawn from public
use (Cebu Oxygen and Acetylene Co. v. Bercilles, 66 SCRA 481 [1975]. A
property continues to be part of the public domain, not available for
private appropriation or ownership 'until there is a formal declaration on
the part of the government to withdraw it from being such' (Ignacio v.
Director of Lands, 108 Phil. 335 [1960]." (Emphasis supplied)
PD No. 1085, issued on February 4, 1977, authorized the issuance of special
land patents for lands reclaimed by PEA from the foreshore or submerged
areas of Manila Bay. On January 19, 1988 then President Corazon C. Aquino
issued Special Patent No. 3517 in the name of PEA for the 157.84 hectares
comprising the partially reclaimed Freedom Islands. Subsequently, on April 9,
1999 the Register of Deeds of the Municipality of Paranaque issued TCT Nos.
7309, 7311 and 7312 in the name of PEA pursuant to Section 103 of PD No.
1529 authorizing the issuance of certificates of title corresponding to land
patents. To this day, these certificates of title are still in the name of PEA.
PD No. 1085, coupled with President Aquino's actual issuance of a special
patent covering the Freedom Islands, is equivalent to an official proclamation
classifying the Freedom Islands as alienable or disposable lands of the public
domain. PD No. 1085 and President Aquino's issuance of a land patent also
constitute a declaration that the Freedom Islands are no longer needed for
public service. The Freedom Islands are thus alienable or disposable lands
of the public domain, open to disposition or concession to qualified parties.
At the time then President Aquino issued Special Patent No. 3517, PEA had
already reclaimed the Freedom Islands although subsequently there were
partial erosions on some areas. The government had also completed the
necessary surveys on these islands. Thus, the Freedom Islands were no
longer part of Manila Bay but part of the land mass. Section 3, Article XII of
the 1987 Constitution classifies lands of the public domain into "agricultural,
forest or timber, mineral lands, and national parks." Being neither timber,
mineral, nor national park lands, the reclaimed Freedom Islands necessarily
fall under the classification of agricultural lands of the public domain. Under
the 1987 Constitution, agricultural lands of the public domain are the only
natural resources that the State may alienate to qualified private parties. All
other natural resources, such as the seas or bays, are "waters x x x owned by
the State" forming part of the public domain, and are inalienable pursuant to
Section 2, Article XII of the 1987 Constitution.
AMARI claims that the Freedom Islands are private lands because CDCP, then
a private corporation, reclaimed the islands under a contract dated
November 20, 1973 with the Commissioner of Public Highways. AMARI, citing
Article 5 of the Spanish Law of Waters of 1866, argues that "if the ownership
of reclaimed lands may be given to the party constructing the works, then it
cannot be said that reclaimed lands are lands of the public domain which the
State may not alienate."75 Article 5 of the Spanish Law of Waters reads as
follows:
"Article 5. Lands reclaimed from the sea in consequence of works
constructed by the State, or by the provinces, pueblos or private
persons, with proper permission, shall become the property of the party
constructing such works, unless otherwise provided by the terms of the
grant of authority." (Emphasis supplied)
Under Article 5 of the Spanish Law of Waters of 1866, private parties could
reclaim from the sea only with "proper permission" from the State. Private
parties could own the reclaimed land only if not "otherwise provided by the
terms of the grant of authority." This clearly meant that no one could reclaim
from the sea without permission from the State because the sea is property
of public dominion. It also meant that the State could grant or withhold
ownership of the reclaimed land because any reclaimed land, like the sea
from which it emerged, belonged to the State. Thus, a private person
reclaiming from the sea without permission from the State could not acquire
ownership of the reclaimed land which would remain property of public
dominion like the sea it replaced.76 Article 5 of the Spanish Law of Waters of
1866 adopted the time-honored principle of land ownership that "all lands
that were not acquired from the government, either by purchase or by grant,
belong to the public domain."77
Article 5 of the Spanish Law of Waters must be read together with laws
subsequently enacted on the disposition of public lands. In particular, CA No.
141 requires that lands of the public domain must first be classified as
alienable or disposable before the government can alienate them. These
lands must not be reserved for public or quasi-public purposes.78 Moreover,
the contract between CDCP and the government was executed after the
effectivity of the 1973 Constitution which barred private corporations from
acquiring any kind of alienable land of the public domain. This contract could
not have converted the Freedom Islands into private lands of a private
corporation.
Presidential Decree No. 3-A, issued on January 11, 1973, revoked all laws
authorizing the reclamation of areas under water and revested solely in the
National Government the power to reclaim lands. Section 1 of PD No. 3-A
declared that –
"The provisions of any law to the contrary notwithstanding, the reclamation
of areas under water, whether foreshore or inland, shall be limited to the
National Government or any person authorized by it under a proper
contract. (Emphasis supplied)
x x x."
PD No. 3-A repealed Section 5 of the Spanish Law of Waters of 1866 because
reclamation of areas under water could now be undertaken only by the
National Government or by a person contracted by the National
Government. Private parties may reclaim from the sea only under a contract
with the National Government, and no longer by grant or permission as
provided in Section 5 of the Spanish Law of Waters of 1866.
Executive Order No. 525, issued on February 14, 1979, designated PEA as the
National Government's implementing arm to undertake "all reclamation
projects of the government," which "shall be undertaken by the PEA or
through a proper contract executed by it with any person or entity." Under
such contract, a private party receives compensation for reclamation services
rendered to PEA. Payment to the contractor may be in cash, or in kind
consisting of portions of the reclaimed land, subject to the constitutional ban
on private corporations from acquiring alienable lands of the public domain.
The reclaimed land can be used as payment in kind only if the reclaimed land
is first classified as alienable or disposable land open to disposition, and then
declared no longer needed for public service.
The Amended JVA covers not only the Freedom Islands, but also an
additional 592.15 hectares which are still submerged and forming part of
Manila Bay. There is no legislative or Presidential act classifying these
submerged areas as alienable or disposable lands of the public domain
open to disposition. These submerged areas are not covered by any patent
or certificate of title. There can be no dispute that these submerged areas
form part of the public domain, and in their present state are inalienable
and outside the commerce of man. Until reclaimed from the sea, these
submerged areas are, under the Constitution, "waters x x x owned by the
State," forming part of the public domain and consequently inalienable. Only
when actually reclaimed from the sea can these submerged areas be
classified as public agricultural lands, which under the Constitution are the
only natural resources that the State may alienate. Once reclaimed and
transformed into public agricultural lands, the government may then
officially classify these lands as alienable or disposable lands open to
disposition. Thereafter, the government may declare these lands no longer
needed for public service. Only then can these reclaimed lands be considered
alienable or disposable lands of the public domain and within the commerce
of man.
The classification of PEA's reclaimed foreshore and submerged lands into
alienable or disposable lands open to disposition is necessary because PEA is
tasked under its charter to undertake public services that require the use of
lands of the public domain. Under Section 5 of PD No. 1084, the functions of
PEA include the following: "[T]o own or operate railroads, tramways and
other kinds of land transportation, x x x; [T]o construct, maintain and operate
such systems of sanitary sewers as may be necessary; [T]o construct,
maintain and operate such storm drains as may be necessary." PEA is
empowered to issue "rules and regulations as may be necessary for the
proper use by private parties of any or all of the highways, roads, utilities,
buildings and/or any of its properties and to impose or collect fees or tolls
for their use." Thus, part of the reclaimed foreshore and submerged lands
held by the PEA would actually be needed for public use or service since
many of the functions imposed on PEA by its charter constitute essential
public services.
Moreover, Section 1 of Executive Order No. 525 provides that PEA "shall be
primarily responsible for integrating, directing, and coordinating all
reclamation projects for and on behalf of the National Government." The
same section also states that "[A]ll reclamation projects shall be approved by
the President upon recommendation of the PEA, and shall be undertaken by
the PEA or through a proper contract executed by it with any person or
entity; x x x." Thus, under EO No. 525, in relation to PD No. 3-A and PD
No.1084, PEA became the primary implementing agency of the National
Government to reclaim foreshore and submerged lands of the public domain.
EO No. 525 recognized PEA as the government entity "to undertake the
reclamation of lands and ensure their maximum utilization in promoting
public welfare and interests."79 Since large portions of these reclaimed lands
would obviously be needed for public service, there must be a formal
declaration segregating reclaimed lands no longer needed for public service
from those still needed for public service.1âwphi1.nêt
Section 3 of EO No. 525, by declaring that all lands reclaimed by PEA "shall
belong to or be owned by the PEA," could not automatically operate to
classify inalienable lands into alienable or disposable lands of the public
domain. Otherwise, reclaimed foreshore and submerged lands of the public
domain would automatically become alienable once reclaimed by PEA,
whether or not classified as alienable or disposable.
The Revised Administrative Code of 1987, a later law than either PD No. 1084
or EO No. 525, vests in the Department of Environment and Natural
Resources ("DENR" for brevity) the following powers and functions:
"Sec. 4. Powers and Functions. The Department shall:
(1) x x x
xxx
(4) Exercise supervision and control over forest lands, alienable and
disposable public lands, mineral resources and, in the process of exercising
such control, impose appropriate taxes, fees, charges, rentals and any such
form of levy and collect such revenues for the exploration, development,
utilization or gathering of such resources;
xxx
(14) Promulgate rules, regulations and guidelines on the issuance of
licenses, permits, concessions, lease agreements and such other privileges
concerning the development, exploration and utilization of the country's
marine, freshwater, and brackish water and over all aquatic resources of
the country and shall continue to oversee, supervise and police our natural
resources; cancel or cause to cancel such privileges upon failure, non-
compliance or violations of any regulation, order, and for all other causes
which are in furtherance of the conservation of natural resources and
supportive of the national interest;
(15) Exercise exclusive jurisdiction on the management and disposition of
all lands of the public domain and serve as the sole agency responsible for
classification, sub-classification, surveying and titling of lands in consultation
with appropriate agencies."80 (Emphasis supplied)
As manager, conservator and overseer of the natural resources of the State,
DENR exercises "supervision and control over alienable and disposable public
lands." DENR also exercises "exclusive jurisdiction on the management and
disposition of all lands of the public domain." Thus, DENR decides whether
areas under water, like foreshore or submerged areas of Manila Bay, should
be reclaimed or not. This means that PEA needs authorization from DENR
before PEA can undertake reclamation projects in Manila Bay, or in any part
of the country.
DENR also exercises exclusive jurisdiction over the disposition of all lands of
the public domain. Hence, DENR decides whether reclaimed lands of PEA
should be classified as alienable under Sections 681 and 782 of CA No. 141.
Once DENR decides that the reclaimed lands should be so classified, it then
recommends to the President the issuance of a proclamation classifying the
lands as alienable or disposable lands of the public domain open to
disposition. We note that then DENR Secretary Fulgencio S. Factoran, Jr.
countersigned Special Patent No. 3517 in compliance with the Revised
Administrative Code and Sections 6 and 7 of CA No. 141.
In short, DENR is vested with the power to authorize the reclamation of areas
under water, while PEA is vested with the power to undertake the physical
reclamation of areas under water, whether directly or through private
contractors. DENR is also empowered to classify lands of the public domain
into alienable or disposable lands subject to the approval of the President.
On the other hand, PEA is tasked to develop, sell or lease the reclaimed
alienable lands of the public domain.
Clearly, the mere physical act of reclamation by PEA of foreshore or
submerged areas does not make the reclaimed lands alienable or disposable
lands of the public domain, much less patrimonial lands of PEA. Likewise, the
mere transfer by the National Government of lands of the public domain to
PEA does not make the lands alienable or disposable lands of the public
domain, much less patrimonial lands of PEA.
Absent two official acts – a classification that these lands are alienable or
disposable and open to disposition and a declaration that these lands are not
needed for public service, lands reclaimed by PEA remain inalienable lands of
the public domain. Only such an official classification and formal declaration
can convert reclaimed lands into alienable or disposable lands of the public
domain, open to disposition under the Constitution, Title I and Title III83 of CA
No. 141 and other applicable laws.84
PEA's Authority to Sell Reclaimed Lands
PEA, like the Legal Task Force, argues that as alienable or disposable lands of
the public domain, the reclaimed lands shall be disposed of in accordance
with CA No. 141, the Public Land Act. PEA, citing Section 60 of CA No. 141,
admits that reclaimed lands transferred to a branch or subdivision of the
government "shall not be alienated, encumbered, or otherwise disposed of
in a manner affecting its title, except when authorized by Congress: x x
x."85 (Emphasis by PEA)
In Laurel vs. Garcia,86 the Court cited Section 48 of the Revised
Administrative Code of 1987, which states that –
"Sec. 48. Official Authorized to Convey Real Property. Whenever real
property of the Government is authorized by law to be conveyed, the deed
of conveyance shall be executed in behalf of the government by the
following: x x x."
Thus, the Court concluded that a law is needed to convey any real property
belonging to the Government. The Court declared that -
"It is not for the President to convey real property of the government on his
or her own sole will. Any such conveyance must be authorized and
approved by a law enacted by the Congress. It requires executive and
legislative concurrence." (Emphasis supplied)
PEA contends that PD No. 1085 and EO No. 525 constitute the legislative
authority allowing PEA to sell its reclaimed lands. PD No. 1085, issued on
February 4, 1977, provides that –
"The land reclaimed in the foreshore and offshore area of Manila
Bay pursuant to the contract for the reclamation and construction of the
Manila-Cavite Coastal Road Project between the Republic of the Philippines
and the Construction and Development Corporation of the Philippines dated
November 20, 1973 and/or any other contract or reclamation covering the
same area is hereby transferred, conveyed and assigned to the ownership
and administration of the Public Estates Authority established pursuant to
PD No. 1084; Provided, however, That the rights and interests of the
Construction and Development Corporation of the Philippines pursuant to
the aforesaid contract shall be recognized and respected.
Henceforth, the Public Estates Authority shall exercise the rights and assume
the obligations of the Republic of the Philippines (Department of Public
Highways) arising from, or incident to, the aforesaid contract between the
Republic of the Philippines and the Construction and Development
Corporation of the Philippines.
In consideration of the foregoing transfer and assignment, the Public Estates
Authority shall issue in favor of the Republic of the Philippines the
corresponding shares of stock in said entity with an issued value of said
shares of stock (which) shall be deemed fully paid and non-assessable.
The Secretary of Public Highways and the General Manager of the Public
Estates Authority shall execute such contracts or agreements, including
appropriate agreements with the Construction and Development
Corporation of the Philippines, as may be necessary to implement the above.
Special land patent/patents shall be issued by the Secretary of Natural
Resources in favor of the Public Estates Authority without prejudice to the
subsequent transfer to the contractor or his assignees of such portion or
portions of the land reclaimed or to be reclaimed as provided for in the
above-mentioned contract. On the basis of such patents, the Land
Registration Commission shall issue the corresponding certificate of title."
(Emphasis supplied)
On the other hand, Section 3 of EO No. 525, issued on February 14, 1979,
provides that -
"Sec. 3. All lands reclaimed by PEA shall belong to or be owned by the
PEA which shall be responsible for its administration, development,
utilization or disposition in accordance with the provisions of Presidential
Decree No. 1084. Any and all income that the PEA may derive from the sale,
lease or use of reclaimed lands shall be used in accordance with the
provisions of Presidential Decree No. 1084."
There is no express authority under either PD No. 1085 or EO No. 525 for PEA
to sell its reclaimed lands. PD No. 1085 merely transferred "ownership and
administration" of lands reclaimed from Manila Bay to PEA, while EO No. 525
declared that lands reclaimed by PEA "shall belong to or be owned by PEA."
EO No. 525 expressly states that PEA should dispose of its reclaimed lands "in
accordance with the provisions of Presidential Decree No. 1084," the charter
of PEA.
PEA's charter, however, expressly tasks PEA "to develop, improve, acquire,
administer, deal in, subdivide, dispose, lease and sell any and all kinds of
lands x x x owned, managed, controlled and/or operated by the
government."87 (Emphasis supplied) There is, therefore, legislative authority
granted to PEA to sell its lands, whether patrimonial or alienable lands of
the public domain. PEA may sell to private parties its patrimonial
properties in accordance with the PEA charter free from constitutional
limitations. The constitutional ban on private corporations from acquiring
alienable lands of the public domain does not apply to the sale of PEA's
patrimonial lands.
PEA may also sell its alienable or disposable lands of the public domain to
private individuals since, with the legislative authority, there is no longer any
statutory prohibition against such sales and the constitutional ban does not
apply to individuals. PEA, however, cannot sell any of its alienable or
disposable lands of the public domain to private corporations since Section 3,
Article XII of the 1987 Constitution expressly prohibits such sales. The
legislative authority benefits only individuals. Private corporations remain
barred from acquiring any kind of alienable land of the public domain,
including government reclaimed lands.
The provision in PD No. 1085 stating that portions of the reclaimed lands
could be transferred by PEA to the "contractor or his assignees" (Emphasis
supplied) would not apply to private corporations but only to individuals
because of the constitutional ban. Otherwise, the provisions of PD No. 1085
would violate both the 1973 and 1987 Constitutions.
The requirement of public auction in the sale of reclaimed lands
Assuming the reclaimed lands of PEA are classified as alienable or disposable
lands open to disposition, and further declared no longer needed for public
service, PEA would have to conduct a public bidding in selling or leasing these
lands. PEA must observe the provisions of Sections 63 and 67 of CA No. 141
requiring public auction, in the absence of a law exempting PEA from holding
a public auction.88 Special Patent No. 3517 expressly states that the patent is
issued by authority of the Constitution and PD No. 1084, "supplemented by
Commonwealth Act No. 141, as amended." This is an acknowledgment that
the provisions of CA No. 141 apply to the disposition of reclaimed alienable
lands of the public domain unless otherwise provided by law. Executive
Order No. 654,89 which authorizes PEA "to determine the kind and manner of
payment for the transfer" of its assets and properties, does not exempt PEA
from the requirement of public auction. EO No. 654 merely authorizes PEA to
decide the mode of payment, whether in kind and in installment, but does
not authorize PEA to dispense with public auction.
Moreover, under Section 79 of PD No. 1445, otherwise known as the
Government Auditing Code, the government is required to sell valuable
government property through public bidding. Section 79 of PD No. 1445
mandates that –
"Section 79. When government property has become unserviceable for any
cause, or is no longer needed, it shall, upon application of the officer
accountable therefor, be inspected by the head of the agency or his duly
authorized representative in the presence of the auditor concerned and, if
found to be valueless or unsaleable, it may be destroyed in their presence. If
found to be valuable, it may be sold at public auction to the highest
bidder under the supervision of the proper committee on award or similar
body in the presence of the auditor concerned or other authorized
representative of the Commission, after advertising by printed notice in the
Official Gazette, or for not less than three consecutive days in any
newspaper of general circulation, or where the value of the property does
not warrant the expense of publication, by notices posted for a like period in
at least three public places in the locality where the property is to be sold. In
the event that the public auction fails, the property may be sold at a private
sale at such price as may be fixed by the same committee or body
concerned and approved by the Commission."
It is only when the public auction fails that a negotiated sale is allowed, in
which case the Commission on Audit must approve the selling price.90 The
Commission on Audit implements Section 79 of the Government Auditing
Code through Circular No. 89-29691 dated January 27, 1989. This circular
emphasizes that government assets must be disposed of only through public
auction, and a negotiated sale can be resorted to only in case of "failure of
public auction."
At the public auction sale, only Philippine citizens are qualified to bid for
PEA's reclaimed foreshore and submerged alienable lands of the public
domain. Private corporations are barred from bidding at the auction sale of
any kind of alienable land of the public domain.
PEA originally scheduled a public bidding for the Freedom Islands on
December 10, 1991. PEA imposed a condition that the winning bidder should
reclaim another 250 hectares of submerged areas to regularize the shape of
the Freedom Islands, under a 60-40 sharing of the additional reclaimed areas
in favor of the winning bidder.92 No one, however, submitted a bid. On
December 23, 1994, the Government Corporate Counsel advised PEA it could
sell the Freedom Islands through negotiation, without need of another public
bidding, because of the failure of the public bidding on December 10, 1991.93
However, the original JVA dated April 25, 1995 covered not only the Freedom
Islands and the additional 250 hectares still to be reclaimed, it also granted
an option to AMARI to reclaim another 350 hectares. The original JVA, a
negotiated contract, enlarged the reclamation area to 750 hectares.94 The
failure of public bidding on December 10, 1991, involving only 407.84
hectares,95 is not a valid justification for a negotiated sale of 750 hectares,
almost double the area publicly auctioned. Besides, the failure of public
bidding happened on December 10, 1991, more than three years before the
signing of the original JVA on April 25, 1995. The economic situation in the
country had greatly improved during the intervening period.
Reclamation under the BOT Law and the Local Government Code
The constitutional prohibition in Section 3, Article XII of the 1987 Constitution
is absolute and clear: "Private corporations or associations may not hold such
alienable lands of the public domain except by lease, x x x." Even Republic
Act No. 6957 ("BOT Law," for brevity), cited by PEA and AMARI as legislative
authority to sell reclaimed lands to private parties, recognizes the
constitutional ban. Section 6 of RA No. 6957 states –
"Sec. 6. Repayment Scheme. - For the financing, construction, operation and
maintenance of any infrastructure projects undertaken through the build-
operate-and-transfer arrangement or any of its variations pursuant to the
provisions of this Act, the project proponent x x x may likewise be repaid in
the form of a share in the revenue of the project or other non-monetary
payments, such as, but not limited to, the grant of a portion or percentage of
the reclaimed land, subject to the constitutional requirements with respect
to the ownership of the land: x x x." (Emphasis supplied)
A private corporation, even one that undertakes the physical reclamation of
a government BOT project, cannot acquire reclaimed alienable lands of the
public domain in view of the constitutional ban.
Section 302 of the Local Government Code, also mentioned by PEA and
AMARI, authorizes local governments in land reclamation projects to pay the
contractor or developer in kind consisting of a percentage of the reclaimed
land, to wit:
"Section 302. Financing, Construction, Maintenance, Operation, and
Management of Infrastructure Projects by the Private Sector. x x x
xxx
In case of land reclamation or construction of industrial estates, the
repayment plan may consist of the grant of a portion or percentage of the
reclaimed land or the industrial estate constructed."
Although Section 302 of the Local Government Code does not contain a
proviso similar to that of the BOT Law, the constitutional restrictions on land
ownership automatically apply even though not expressly mentioned in the
Local Government Code.
Thus, under either the BOT Law or the Local Government Code, the
contractor or developer, if a corporate entity, can only be paid with
leaseholds on portions of the reclaimed land. If the contractor or developer is
an individual, portions of the reclaimed land, not exceeding 12 hectares 96 of
non-agricultural lands, may be conveyed to him in ownership in view of the
legislative authority allowing such conveyance. This is the only way these
provisions of the BOT Law and the Local Government Code can avoid a direct
collision with Section 3, Article XII of the 1987 Constitution.
Registration of lands of the public domain
Finally, PEA theorizes that the "act of conveying the ownership of the
reclaimed lands to public respondent PEA transformed such lands of the
public domain to private lands." This theory is echoed by AMARI which
maintains that the "issuance of the special patent leading to the eventual
issuance of title takes the subject land away from the land of public domain
and converts the property into patrimonial or private property." In short, PEA
and AMARI contend that with the issuance of Special Patent No. 3517 and
the corresponding certificates of titles, the 157.84 hectares comprising the
Freedom Islands have become private lands of PEA. In support of their
theory, PEA and AMARI cite the following rulings of the Court:
1. Sumail v. Judge of CFI of Cotabato,97 where the Court held –
"Once the patent was granted and the corresponding certificate of title was
issued, the land ceased to be part of the public domain and became private
property over which the Director of Lands has neither control nor
jurisdiction."
2. Lee Hong Hok v. David,98 where the Court declared -
"After the registration and issuance of the certificate and duplicate certificate
of title based on a public land patent, the land covered thereby automatically
comes under the operation of Republic Act 496 subject to all the safeguards
provided therein."3. Heirs of Gregorio Tengco v. Heirs of Jose
Aliwalas,99 where the Court ruled -
"While the Director of Lands has the power to review homestead patents, he
may do so only so long as the land remains part of the public domain and
continues to be under his exclusive control; but once the patent is registered
and a certificate of title is issued, the land ceases to be part of the public
domain and becomes private property over which the Director of Lands has
neither control nor jurisdiction."
4. Manalo v. Intermediate Appellate Court,100 where the Court held –
"When the lots in dispute were certified as disposable on May 19, 1971, and
free patents were issued covering the same in favor of the private
respondents, the said lots ceased to be part of the public domain and,
therefore, the Director of Lands lost jurisdiction over the same."
5.Republic v. Court of Appeals,101 where the Court stated –
"Proclamation No. 350, dated October 9, 1956, of President Magsaysay
legally effected a land grant to the Mindanao Medical Center, Bureau of
Medical Services, Department of Health, of the whole lot, validly sufficient
for initial registration under the Land Registration Act. Such land grant is
constitutive of a 'fee simple' title or absolute title in favor of petitioner
Mindanao Medical Center. Thus, Section 122 of the Act, which governs the
registration of grants or patents involving public lands, provides that
'Whenever public lands in the Philippine Islands belonging to the
Government of the United States or to the Government of the Philippines are
alienated, granted or conveyed to persons or to public or private
corporations, the same shall be brought forthwith under the operation of this
Act (Land Registration Act, Act 496) and shall become registered lands.'"
The first four cases cited involve petitions to cancel the land patents and the
corresponding certificates of titles issued to private parties. These four cases
uniformly hold that the Director of Lands has no jurisdiction over private
lands or that upon issuance of the certificate of title the land automatically
comes under the Torrens System. The fifth case cited involves the
registration under the Torrens System of a 12.8-hectare public land granted
by the National Government to Mindanao Medical Center, a government unit
under the Department of Health. The National Government transferred the
12.8-hectare public land to serve as the site for the hospital buildings and
other facilities of Mindanao Medical Center, which performed a public
service. The Court affirmed the registration of the 12.8-hectare public land in
the name of Mindanao Medical Center under Section 122 of Act No. 496. This
fifth case is an example of a public land being registered under Act No. 496
without the land losing its character as a property of public dominion.
In the instant case, the only patent and certificates of title issued are those in
the name of PEA, a wholly government owned corporation performing public
as well as proprietary functions. No patent or certificate of title has been
issued to any private party. No one is asking the Director of Lands to cancel
PEA's patent or certificates of title. In fact, the thrust of the instant petition is
that PEA's certificates of title should remain with PEA, and the land covered
by these certificates, being alienable lands of the public domain, should not
be sold to a private corporation.
Registration of land under Act No. 496 or PD No. 1529 does not vest in the
registrant private or public ownership of the land. Registration is not a mode
of acquiring ownership but is merely evidence of ownership previously
conferred by any of the recognized modes of acquiring ownership.
Registration does not give the registrant a better right than what the
registrant had prior to the registration.102 The registration of lands of the
public domain under the Torrens system, by itself, cannot convert public
lands into private lands.103
Jurisprudence holding that upon the grant of the patent or issuance of the
certificate of title the alienable land of the public domain automatically
becomes private land cannot apply to government units and entities like PEA.
The transfer of the Freedom Islands to PEA was made subject to the
provisions of CA No. 141 as expressly stated in Special Patent No. 3517 issued
by then President Aquino, to wit:
"NOW, THEREFORE, KNOW YE, that by authority of the Constitution of the
Philippines and in conformity with the provisions of Presidential Decree No.
1084, supplemented by Commonwealth Act No. 141, as amended, there are
hereby granted and conveyed unto the Public Estates Authority the aforesaid
tracts of land containing a total area of one million nine hundred fifteen
thousand eight hundred ninety four (1,915,894) square meters; the technical
description of which are hereto attached and made an integral part hereof."
(Emphasis supplied)
Thus, the provisions of CA No. 141 apply to the Freedom Islands on matters
not covered by PD No. 1084. Section 60 of CA No. 141 prohibits, "except
when authorized by Congress," the sale of alienable lands of the public
domain that are transferred to government units or entities. Section 60 of CA
No. 141 constitutes, under Section 44 of PD No. 1529, a "statutory lien
affecting title" of the registered land even if not annotated on the certificate
of title.104 Alienable lands of the public domain held by government entities
under Section 60 of CA No. 141 remain public lands because they cannot be
alienated or encumbered unless Congress passes a law authorizing their
disposition. Congress, however, cannot authorize the sale to private
corporations of reclaimed alienable lands of the public domain because of
the constitutional ban. Only individuals can benefit from such law.
The grant of legislative authority to sell public lands in accordance with
Section 60 of CA No. 141 does not automatically convert alienable lands of
the public domain into private or patrimonial lands. The alienable lands of
the public domain must be transferred to qualified private parties, or to
government entities not tasked to dispose of public lands, before these lands
can become private or patrimonial lands. Otherwise, the constitutional ban
will become illusory if Congress can declare lands of the public domain as
private or patrimonial lands in the hands of a government agency tasked to
dispose of public lands. This will allow private corporations to acquire directly
from government agencies limitless areas of lands which, prior to such law,
are concededly public lands.
Under EO No. 525, PEA became the central implementing agency of the
National Government to reclaim foreshore and submerged areas of the
public domain. Thus, EO No. 525 declares that –
"EXECUTIVE ORDER NO. 525
Designating the Public Estates Authority as the Agency Primarily Responsible
for all Reclamation Projects
Whereas, there are several reclamation projects which are ongoing or being
proposed to be undertaken in various parts of the country which need to be
evaluated for consistency with national programs;
Whereas, there is a need to give further institutional support to the
Government's declared policy to provide for a coordinated, economical and
efficient reclamation of lands;
Whereas, Presidential Decree No. 3-A requires that all reclamation of areas
shall be limited to the National Government or any person authorized by it
under proper contract;
Whereas, a central authority is needed to act on behalf of the National
Government which shall ensure a coordinated and integrated approach in
the reclamation of lands;
Whereas, Presidential Decree No. 1084 creates the Public Estates Authority
as a government corporation to undertake reclamation of lands and ensure
their maximum utilization in promoting public welfare and interests; and
Whereas, Presidential Decree No. 1416 provides the President with
continuing authority to reorganize the national government including the
transfer, abolition, or merger of functions and offices.
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by
virtue of the powers vested in me by the Constitution and pursuant to
Presidential Decree No. 1416, do hereby order and direct the following:
Section 1. The Public Estates Authority (PEA) shall be primarily responsible
for integrating, directing, and coordinating all reclamation projects for and
on behalf of the National Government. All reclamation projects shall be
approved by the President upon recommendation of the PEA, and shall be
undertaken by the PEA or through a proper contract executed by it with any
person or entity; Provided, that, reclamation projects of any national
government agency or entity authorized under its charter shall be
undertaken in consultation with the PEA upon approval of the President.
x x x ."
As the central implementing agency tasked to undertake reclamation
projects nationwide, with authority to sell reclaimed lands, PEA took the
place of DENR as the government agency charged with leasing or selling
reclaimed lands of the public domain. The reclaimed lands being leased or
sold by PEA are not private lands, in the same manner that DENR, when it
disposes of other alienable lands, does not dispose of private lands but
alienable lands of the public domain. Only when qualified private parties
acquire these lands will the lands become private lands. In the hands of the
government agency tasked and authorized to dispose of alienable of
disposable lands of the public domain, these lands are still public, not
private lands.
Furthermore, PEA's charter expressly states that PEA "shall hold lands of the
public domain" as well as "any and all kinds of lands." PEA can hold both
lands of the public domain and private lands. Thus, the mere fact that
alienable lands of the public domain like the Freedom Islands are transferred
to PEA and issued land patents or certificates of title in PEA's name does not
automatically make such lands private.
To allow vast areas of reclaimed lands of the public domain to be transferred
to PEA as private lands will sanction a gross violation of the constitutional
ban on private corporations from acquiring any kind of alienable land of the
public domain. PEA will simply turn around, as PEA has now done under the
Amended JVA, and transfer several hundreds of hectares of these reclaimed
and still to be reclaimed lands to a single private corporation in only one
transaction. This scheme will effectively nullify the constitutional ban in
Section 3, Article XII of the 1987 Constitution which was intended to diffuse
equitably the ownership of alienable lands of the public domain among
Filipinos, now numbering over 80 million strong.
This scheme, if allowed, can even be applied to alienable agricultural lands of
the public domain since PEA can "acquire x x x any and all kinds of lands."
This will open the floodgates to corporations and even individuals acquiring
hundreds of hectares of alienable lands of the public domain under the guise
that in the hands of PEA these lands are private lands. This will result in
corporations amassing huge landholdings never before seen in this country -
creating the very evil that the constitutional ban was designed to prevent.
This will completely reverse the clear direction of constitutional development
in this country. The 1935 Constitution allowed private corporations to
acquire not more than 1,024 hectares of public lands. 105 The 1973
Constitution prohibited private corporations from acquiring any kind of
public land, and the 1987 Constitution has unequivocally reiterated this
prohibition.
The contention of PEA and AMARI that public lands, once registered under
Act No. 496 or PD No. 1529, automatically become private lands is contrary
to existing laws. Several laws authorize lands of the public domain to be
registered under the Torrens System or Act No. 496, now PD No. 1529,
without losing their character as public lands. Section 122 of Act No. 496, and
Section 103 of PD No. 1529, respectively, provide as follows:
Act No. 496
"Sec. 122. Whenever public lands in the Philippine Islands belonging to the x
x x Government of the Philippine Islands are alienated, granted, or conveyed
to persons or the public or private corporations, the same shall be brought
forthwith under the operation of this Act and shall become registered lands."
PD No. 1529
"Sec. 103. Certificate of Title to Patents. Whenever public land is by the
Government alienated, granted or conveyed to any person, the same shall be
brought forthwith under the operation of this Decree." (Emphasis supplied)
Based on its legislative history, the phrase "conveyed to any person" in
Section 103 of PD No. 1529 includes conveyances of public lands to public
corporations.
Alienable lands of the public domain "granted, donated, or transferred to a
province, municipality, or branch or subdivision of the Government," as
provided in Section 60 of CA No. 141, may be registered under the Torrens
System pursuant to Section 103 of PD No. 1529. Such registration, however,
is expressly subject to the condition in Section 60 of CA No. 141 that the land
"shall not be alienated, encumbered or otherwise disposed of in a manner
affecting its title, except when authorized by Congress." This provision
refers to government reclaimed, foreshore and marshy lands of the public
domain that have been titled but still cannot be alienated or encumbered
unless expressly authorized by Congress. The need for legislative authority
prevents the registered land of the public domain from becoming private
land that can be disposed of to qualified private parties.
The Revised Administrative Code of 1987 also recognizes that lands of the
public domain may be registered under the Torrens System. Section 48,
Chapter 12, Book I of the Code states –
"Sec. 48. Official Authorized to Convey Real Property. Whenever real
property of the Government is authorized by law to be conveyed, the deed
of conveyance shall be executed in behalf of the government by the
following:
(1) x x x
(2) For property belonging to the Republic of the Philippines, but titled in
the name of any political subdivision or of any corporate agency or
instrumentality, by the executive head of the agency or instrumentality."
(Emphasis supplied)
Thus, private property purchased by the National Government for expansion
of a public wharf may be titled in the name of a government corporation
regulating port operations in the country. Private property purchased by the
National Government for expansion of an airport may also be titled in the
name of the government agency tasked to administer the airport. Private
property donated to a municipality for use as a town plaza or public school
site may likewise be titled in the name of the municipality. 106 All these
properties become properties of the public domain, and if already registered
under Act No. 496 or PD No. 1529, remain registered land. There is no
requirement or provision in any existing law for the de-registration of land
from the Torrens System.
Private lands taken by the Government for public use under its power of
eminent domain become unquestionably part of the public domain.
Nevertheless, Section 85 of PD No. 1529 authorizes the Register of Deeds to
issue in the name of the National Government new certificates of title
covering such expropriated lands. Section 85 of PD No. 1529 states –
"Sec. 85. Land taken by eminent domain. Whenever any registered land, or
interest therein, is expropriated or taken by eminent domain, the National
Government, province, city or municipality, or any other agency or
instrumentality exercising such right shall file for registration in the proper
Registry a certified copy of the judgment which shall state definitely by an
adequate description, the particular property or interest expropriated, the
number of the certificate of title, and the nature of the public use. A
memorandum of the right or interest taken shall be made on each certificate
of title by the Register of Deeds, and where the fee simple is taken, a new
certificate shall be issued in favor of the National Government, province,
city, municipality, or any other agency or instrumentality exercising such
right for the land so taken. The legal expenses incident to the memorandum
of registration or issuance of a new certificate of title shall be for the account
of the authority taking the land or interest therein." (Emphasis supplied)
Consequently, lands registered under Act No. 496 or PD No. 1529 are not
exclusively private or patrimonial lands. Lands of the public domain may also
be registered pursuant to existing laws.
AMARI makes a parting shot that the Amended JVA is not a sale to AMARI of
the Freedom Islands or of the lands to be reclaimed from submerged areas of
Manila Bay. In the words of AMARI, the Amended JVA "is not a sale but a
joint venture with a stipulation for reimbursement of the original cost
incurred by PEA for the earlier reclamation and construction works
performed by the CDCP under its 1973 contract with the Republic." Whether
the Amended JVA is a sale or a joint venture, the fact remains that the
Amended JVA requires PEA to "cause the issuance and delivery of the
certificates of title conveying AMARI's Land Share in the name of AMARI." 107
This stipulation still contravenes Section 3, Article XII of the 1987 Constitution
which provides that private corporations "shall not hold such alienable lands
of the public domain except by lease." The transfer of title and ownership to
AMARI clearly means that AMARI will "hold" the reclaimed lands other than
by lease. The transfer of title and ownership is a "disposition" of the
reclaimed lands, a transaction considered a sale or alienation under CA No.
141,108 the Government Auditing Code,109 and Section 3, Article XII of the
1987 Constitution.
The Regalian doctrine is deeply implanted in our legal system. Foreshore and
submerged areas form part of the public domain and are inalienable. Lands
reclaimed from foreshore and submerged areas also form part of the public
domain and are also inalienable, unless converted pursuant to law into
alienable or disposable lands of the public domain. Historically, lands
reclaimed by the government are sui generis, not available for sale to private
parties unlike other alienable public lands. Reclaimed lands retain their
inherent potential as areas for public use or public service. Alienable lands of
the public domain, increasingly becoming scarce natural resources, are to be
distributed equitably among our ever-growing population. To insure such
equitable distribution, the 1973 and 1987 Constitutions have barred private
corporations from acquiring any kind of alienable land of the public domain.
Those who attempt to dispose of inalienable natural resources of the State,
or seek to circumvent the constitutional ban on alienation of lands of the
public domain to private corporations, do so at their own risk.
We can now summarize our conclusions as follows:
1. The 157.84 hectares of reclaimed lands comprising the Freedom Islands,
now covered by certificates of title in the name of PEA, are alienable lands
of the public domain. PEA may lease these lands to private corporations but
may not sell or transfer ownership of these lands to private corporations.
PEA may only sell these lands to Philippine citizens, subject to the ownership
limitations in the 1987 Constitution and existing laws.
2. The 592.15 hectares of submerged areas of Manila Bay remain inalienable
natural resources of the public domain until classified as alienable or
disposable lands open to disposition and declared no longer needed for
public service. The government can make such classification and declaration
only after PEA has reclaimed these submerged areas. Only then can these
lands qualify as agricultural lands of the public domain, which are the only
natural resources the government can alienate. In their present state, the
592.15 hectares of submerged areas are inalienable and outside the
commerce of man.
3. Since the Amended JVA seeks to transfer to AMARI, a private corporation,
ownership of 77.34 hectares110 of the Freedom Islands, such transfer is void
for being contrary to Section 3, Article XII of the 1987 Constitution which
prohibits private corporations from acquiring any kind of alienable land of
the public domain.
4. Since the Amended JVA also seeks to transfer to AMARI ownership of
290.156 hectares111 of still submerged areas of Manila Bay, such transfer is
void for being contrary to Section 2, Article XII of the 1987 Constitution which
prohibits the alienation of natural resources other than agricultural lands of
the public domain. PEA may reclaim these submerged areas. Thereafter, the
government can classify the reclaimed lands as alienable or disposable, and
further declare them no longer needed for public service. Still, the transfer of
such reclaimed alienable lands of the public domain to AMARI will be void in
view of Section 3, Article XII of the 1987 Constitution which prohibits private
corporations from acquiring any kind of alienable land of the public domain.
Clearly, the Amended JVA violates glaringly Sections 2 and 3, Article XII of the
1987 Constitution. Under Article 1409112 of the Civil Code, contracts whose
"object or purpose is contrary to law," or whose "object is outside the
commerce of men," are "inexistent and void from the beginning." The Court
must perform its duty to defend and uphold the Constitution, and therefore
declares the Amended JVA null and void ab initio.
Seventh issue: whether the Court is the proper forum to raise the issue of
whether the Amended JVA is grossly disadvantageous to the government.

Considering that the Amended JVA is null and void ab initio, there is no
necessity to rule on this last issue. Besides, the Court is not a trier of facts,
and this last issue involves a determination of factual matters.

WHEREFORE, the petition is GRANTED. The Public Estates Authority and

Amari Coastal Bay Development Corporation are PERMANENTLY
ENJOINED from implementing the Amended Joint Venture Agreement which
is hereby declared NULL and VOID ab initio.

SO ORDERED.

G.R. No. 160145 November 11, 2005

REPUBLIC OF THE PHILIPPINES, Petitioner,
vs.
PEDRO O. ENCISO, Respondent.
DECISION
CALLEJO, SR., J.:
Before us is a petition for review on certiorari under Rule 45 of the Rules of
Court, as amended, assailing the Decision1 of the Court of Appeals (CA) dated
September 26, 2003, which affirmed the Decision 2 of the Regional Trial Court
(RTC), Iba, Zambales, Branch 71, promulgated on July 31, 2001 in LRC Case
No. RTC-N-75-I. The CA and the trial court adjudicated Lot No. 2278-A, Cad.
652-D, Masinloc Cadastre in favor of respondent Pedro O. Enciso, pursuant
to Section 29 of Presidential Decree (P.D.) No. 1529.
The facts, as culled from the records of the case, show that on April 24, 2000,
the respondent, alleging to be the owner in fee simple of a parcel of
residential land located in Barangay South Poblacion, Masinloc, Zambales,
filed a petition for land registration before the RTC of Iba, Zambales. The lot
is described as follows:
A parcel of land (Lot 2278-A of the subdivision plan Csd-03-012562-D being a
portion of Lot 2278, Cad. 652-D L.R.C. Rec. No.), situated in the Barrio of
South Poblacion, Municipality of Masinloc, Province of Zambales. Bounded
on the NW., along line 1-2 by Sta. Lucia Street; on the NE., along line 2-3 by
Capt. Albright Street; on the SE. & SW. along line 3-4-1 by Lot 2278-B of the
subd. plan. Beginning at a point marked "1" on plan being N. 39 deg. 35’E.,
12.05 m. from BLLM.1,
Cad. 652-D.
thence N. 16 deg. 13’E., 32.48 m. to point. 2;
thence S. 75 deg. 05’E., 44.83 m. to point. 3;
thence S. 16 deg. 19’W., 33.36 m. to point. 4;
thence N. 73 deg. 57’W., 44.76 m. to point. of;
beginning; containing an area of ONE THOUSAND FOUR HUNDRED SEVENTY-
FIVE (1,475) square meters. All points referred to are indicated on the plan
and are marked on the ground by P.S. cyl. conc. mons. 15 x 40 cms. Bearings;
true; date of original survey; Sept. 1927-July 1928 and that of the subdivision
survey; July 22, 1999 and was approved on Jan. 20, 2000.3
The respondent averred, inter alia, that he acquired title to the said lot by
virtue of an extrajudicial settlement of estate and quitclaim on March 15,
1999; the said property is not tenanted or occupied by any person other than
the respondent and his family who are in actual physical possession of the
same; and the respondent and his predecessors-in-interest have been in
continuous, peaceful, open, notorious, uninterrupted and adverse possession
of the land in the concept of an owner for not less than 30 years immediately
preceding the filing of the application.4
Petitioner Republic of the Philippines, through the Office of the Solicitor
General (OSG), opposed the application on the following grounds: (a) neither
the respondent nor his predecessors-in-interest have been in open,
continuous, exclusive, and notorious possession and occupation of the
subject land since June 12, 1945 or prior thereto; (b) the respondent failed to
adduce any muniment of title and/or the tax declaration with the application
to prove bona fide acquisition of the land applied for or its open, continuous,
exclusive and notorious possession and occupation thereof in the concept of
owner since June 12, 1945 or prior thereto; (c) the alleged tax declaration
adverted to in the application does not appear to be genuine and the tax
declarations indicate such possession to be of recent vintage; (d) the claim of
ownership in fee simple on the basis of Spanish title or grant can no longer
be availed of by the respondent considering that he failed to file an
appropriate application for registration within the period of six months from
February 16, 1976 as required by P.D. No. 892; and (e) the subject land is a
portion of the public domain belonging to the Republic of the Philippines
which is not subject to private appropriation.5
After ascertaining that the jurisdictional requirements for the application
were done in accordance with the law during the initial hearing 6 on
November 9, 2000, the trial court issued an Order of Default 7 on January 3,
2001 against all persons with the exception of the government.
The respondent presented tax receipts to show that the property was
declared for taxation purposes in his name. He also testified that he acquired
the property by inheritance from his deceased father, Vicente Enciso, who
died on May 18, 1991. He then immediately took possession of the property
and constructed a house thereon in 1991. On March 15, 1999, he and his
siblings executed an extrajudicial settlement of estate where the land was
adjudicated in his favor.
The respondent further narrated that the property was originally owned by
the Municipality of Masinloc, Zambales. On October 5, 1968, the municipality
passed Resolution No. 71,8 undertaking to construct a road along the
shoreline of the poblacion, but requiring landowners adjoining the roads to
share in the expenses for an inner wall adjacent to their lots. In view of this,
the same resolution provided that:
WHEREAS, where the above landowners share in the construction of the
roads, the same may be given the priority to acquire such additional available
areas by purchase, if such additional areas are not needed by the
government for public use, the advances of the landowners as a result of his
[sic] construction (inner wall) be considered as price of the land, provided
that the cost and value of the inner wall exceeds the assessed value of the
land, and if the cost of the inner wall is less than the assessed value of the
land, the landowners will have to pay the corresponding balance to the
government; …9
On March 8, 1969, the Municipality of Masinloc, Zambales passed
supplementary Resolution No. 102,10 which stated that in consideration of
the financial assistance extended by the abutting property owners, and
because the government no longer needed the additional areas for public
use, the municipality was authorizing the Municipal Mayor to enter into and
sign deeds of purchase between the municipality and the landowners
concerned. Consequently, the Municipal Council of Masinloc, Zambales
unanimously approved Resolution No. 102-A11 dated March 15, 1969,
authorizing its mayor to execute a deed of sale in favor of Honorato Edaño,
covering a portion of the reclaimed lots no longer needed for public use.
Honorato was thus entitled to buy the lot for his help in carrying out the
project envisioned in Resolution No. 71, and after the submission of an
itemized statement of the cost of the construction of the inner wall along
Sta. Lucia Street.
Immediately thereafter, the Municipality of Masinloc, Zambales, represented
by its Mayor, P.A. Edaño, executed a Deed of Absolute Sale12 covering a piece
of reclaimed land containing more or less 2,790 square meters in favor of
Honorato Edaño. The deed stated that the vendee constructed the inner wall
needed to facilitate the fabrication of a portion of Sta. Lucia Street, which
was opposite his lot, and the extensions of Magsaysay and Capt. Albright
Streets at a total expense of ₱1,683.80. Considering that the assessed value
of the lot was ₱2,092.50, or ₱408.70
more than the vendee spent for the construction of the inner wall, the
vendee paid ₱408.70 to the vendor.
The respondent admitted that Honorato was his uncle, being his father’s
half-brother.13 He further narrated that on December 9, 1980, the spouses
Honorato and Esperanza Edaño sold the lot to Vicente B. Enciso for
₱2,092.50 via a Deed of Absolute Sale.14 On January 17, 1981, Vicente Enciso,
Natividad Edaño Asuncion and Thelma A. Edaño entered into a Deed of
Partition15 involving the same parcel of land. Vicente was awarded one-half
of the total area of the property, 1,398 square meters, more or less;
Natividad and Thelma got one-fourth each, or approximately 697.5 square
meters individually.
No cross-examination was conducted and no evidence was adduced by the
government to controvert the application for registration.
On May 8, 2001, Director Felino M. Cortez of the Department on Registration
submitted the Report16 of the Land Registration Authority, informing the trial
court that it was not in a position to verify whether the parcel of land subject
of registration was already covered by a land patent and previously approved
isolated survey. Acting on this report, the trial court directed the Lands
Management Bureau, the Community Environment and Natural Resources
Office of Iba, Zambales, and the
Department of Environment and Natural Resources Regional Executive
Director for Region III, San Fernando, Pampanga, to submit a report on the
status of the parcel of land.17
Without waiting for the final report, the trial court granted the application
for registration on July 31, 2001, the dispositive portion of the decision reads:
WHEREFORE, this Court, after confirming the Order of General Default
entered into the record of this case on January 3, 2001 hereby adjudicates
Lot No. 2278-A, Cad. 652-D, Masinloc Cadastre, containing an area of 1,475
square meters, situated at Brgy. South Poblacion, Masinloc, Zambales,
Philippines, as appearing on the approved Plan No. Csd-03-012562-D (Exhibit
"M") and also in the Technical Description of said lot (Exhibit "K") in favor of
the applicant whose address is at Brgy. South Poblacion, Masinloc, Zambales,
Philippines, in accordance with Section 29 of Presidential Decree No. 1529.
This adjudication however is subject to the various easements/reservations
provided for under pertinent laws, Presidential Decree and/or Presidential
Letters of Instruction, which should be annotated/projected in the title to be
issued.
Once this decision becomes final, let the corresponding decree and title be
issued.
SO ORDERED.18
The trial court ruled that the respondent satisfactorily proved his ownership
in fee simple, as well as the identity of the land sought to be titled. Likewise,
the trial court found that the respondent, as well as his predecessors-in-
interest, had been in open, peaceful, continuous, public, adverse, and under
a bona fide claim of ownership. According to the trial court, there was no
evidence that the subject parcel of land was within any government
reservation, or that the applicant was disqualified from owning real property
under the Constitution.19
The Republic of the Philippines appealed the case before the CA, contending
that the trial court erred in granting the application despite his failure to
prove registrable title over Lot No. 2278-A.
The CA disposed of the appeal on September 26, 2003 and affirmed the
decision of the trial court. The fallo of the decision reads:
WHEREFORE, premises considered, the assailed decision dated July 31, 2001
of the RTC, Branch 71 of Iba, Zambales in LRC Case No. RTC-N-75-1 is hereby
AFFIRMED.
20
SO ORDERED.
The petitioner dispensed with the filing of a motion for reconsideration and
forthwith filed the instant petition.
The OSG assigned the following error to the appellate court:
THE COURT OF APPEALS ERRED ON A QUESTION OF LAW IN GRANTING
RESPONDENT’S PETITION FOR REGISTRATION SANS ANY SHOWING THAT THE
SUBJECT PROPERTY WAS PREVIOUSLY DECLARED ALIENABLE AND
DISPOSABLE LANDS OF THE PUBLIC DOMAIN.21
The petitioner contends that the first and primordial element in order to
warrant the registration of title is to show that the land must be an alienable
and disposable land of the public domain. On this note, the petitioner
believes that the respondent failed to adduce any evidence to show that the
subject land was already previously declared part of such alienable and
disposable land of the public domain. Furthermore, the petitioner adds that
under the Regalian doctrine, all lands of the public domain belong to the
State, and those not otherwise appearing to be clearly within private
ownership are presumed to belong to it.
In his comment to the petition, the respondent asserts that the CA was
correct in affirming the decision of the land registration court. The
respondent cites the following justification of the CA in supporting his claim
over Lot No. 2278-A:
Records reveal that subject land is a residential land owned by the
Municipality of Masinloc, Zambales. The Municipality of Masinloc, through
Resolutions 71, 102 and 102-A-29 sold the subject land to Honorato Edaño as
evidenced by the Deed of Absolute Sale dated March 31, 1969 executed by
the Municipal Mayor.
Article 423 of the Civil Code provides that:
"Art. 423. The property of provinces, cities, and municipalities is divided into
property for public use and patrimonial property."
Properties of political subdivision[s] which are patrimonial in character may
be alienated. By analogy, when a municipality’s properties for public use are
no longer intended for such use, the same become patrimonial and may be
the subject of a contract. Thus, the Deed of Absolute Sale executed by and
between the Municipal Mayor of Masinloc and Honorato Edaño was a valid
contract. Subject land was likewise sold by Honorato Edaño to petitioner-
appellee’s father, Vicente Enciso, by virtue of a Deed of Absolute Sale. From
then, subject land changed hand until it was acquired by petitioner-appellee
when his siblings executed an Extrajudicial Partition assigning said land to
him. It was declared for taxation purposes in his name under Tax Declaration
No. 007-0700R. …
…
Subject land was reclassified as residential. It was already segregated from
the public domain and assumed the character of private ownership. It was
reclaimed by the Municipality of Masinloc and eventually adjudicated to
Honorato Edaño. The Municipality of Masinloc must have been in possession
of the subject land even before 1969 considering that it was originally
surveyed way back in 1927-1928. In the exercise of its proprietary right, the
Municipality of Masinloc validly conveyed the subject land to petitioner-
appellee’s predecessors-in-interest. Petitioner-appellee’s possession and
occupation of the subject land is continuous, public, adverse and
uninterrupted and in the concept an owner and no other person claimed
possession and ownership of the same. Article 1137 of the Civil Code
provides:
"Art. 1137. Ownership and other real rights over immovables also prescribed
(sic) through uninterrupted adverse possession thereof for thirty years,
without need of titles or of good faith."
Parenthetically, petitioner-appellee’s possession tacked with that of his
predecessors-in-interest already complied with the thirty (30)-year
requirement of open, continuous, exclusive and notorious possession
required under the law.
Prescinding from the foregoing, petitioner-appellee sufficiently and
satisfactorily proved his real and absolute ownership in fee simple; that he
has a registrable title over the subject land and that he complied with the
requirements under the law to warrant registration of title over the subject
land.22
The petition is meritorious.
While it is the rule that findings of fact of appellate courts are conclusive
upon this Court, among the recognized exceptions is where the findings of
fact are not supported by the record or are conspicuously erroneous as to
constitute a serious abuse of discretion.23 This is the situation in this case.
Section 14(1) of P.D. No. 1529, otherwise known as the Property Registration possession of a land consists in the manifestation of acts of dominion over it
Decree, provides: of such a nature as a party would naturally exercise over his own property.

SEC. 14. Who may apply. –The following persons may file in the proper Court
of First Instance an application for registration of title to land, whether
personally or through their duly authorized representatives:
(1) Those who by themselves or through their predecessors-in-interest have
been in open, continuous, exclusive and notorious possession and
occupation of alienable and disposable lands of the public domain under
a bona fide claim of ownership since June 12, 1945, or earlier.
Applicants for registration of title must therefore prove the following: (a) that
the land forms part of the disposable and alienable lands of the public
domain; and (b) that they have been in open, continuous, exclusive,
and notorious possession and occupation of the same under a bona
fide claim of ownership either since time immemorial, or since June 12, 1945.
It is not disputed that the land sought to be registered was originally part of
the reclamation project undertaken by the Municipality of Masinloc,
Zambales. The prevailing rule is that reclaimed disposable lands of the public
domain may only be leased and not sold to private parties. These lands
remained sui generis, as the only alienable or disposable lands of the public
domain which the government could not sell to private parties except if the
legislature passes a law authorizing such sale. Reclaimed lands retain their
inherent potential as areas for public use or public service.24 The ownership
of lands reclaimed from foreshore areas is rooted in the Regalian doctrine,
which declares that all lands and waters of the public domain belong to the
State.25 On November 7, 1936, the National Assembly approved
Commonwealth Act No. 141, also known as the Public Land Act, compiling all
the existing laws on lands of the public domain. This remains to this day the
existing and applicable general law governing the classification and
disposition of lands of the public domain. The State policy prohibiting the
sale of government reclaimed, foreshore and marshy alienable lands of the
public domain to private individuals continued under the 1935 Constitution.
Indeed, there is nothing to support the respondent’s claim that the property
"was reclassified as residential … already segregated from the public domain
and assumed the character of private ownership." At the
moment, it is not clear as to when the proper authorities classified the
subject as alienable and disposable. It must be stressed that incontrovertible
evidence must be presented to establish that the land subject of the
application is alienable or disposable.26
The respondent’s possession and that of his "predecessors-in-interest" will
not suffice for purposes of judicial confirmation of title. What is categorically
required by law is open, continuous, exclusive, and notorious possession
and occupation under a bona fide claim of ownership since June 12, 1945 or
earlier.
The evidence on record shows that a house was constructed on the subject
property only in 1991. Certain discrepancies likewise surround the
application for registration: Honorato Edaño sold a parcel of land consisting
of 2,790 square meters on December 9, 1980 to Vicente Enciso alone; on
January 17, 1981, Vicente Enciso, Natividad Edaño Asuncion and Thelma
Edaño executed a deed of partition covering the same lot. Why was there a
need to partition the property if the entire land had already been sold to
Vicente? The Court also notes that in the said deed of partition, one-half of
the total area of the land, which was 1,398 square meters, was adjudicated
in favor of Vicente; however, in the respondent’s application for registration,
the land sought to be registered consists of 1,475 square meters.
Well-entrenched is the rule that the burden of proof in land registration
cases rests on the applicant who must show clear, positive and convincing
evidence that his alleged possession and occupation were of the nature and
duration required by law. Bare allegations, without more, do not amount to
preponderant evidence that would shift the burden to the oppositor. 28
Evidently, the respondent failed to prove that (1) Lot No. 2278-A was
classified as part of the disposable and alienable land of the public domain;
and (2) he and his predecessors-in-interest have been in open, continuous,
exclusive, and notorious possession and occupation thereof in the concept of
owners since time immemorial, or from June 12, 1945.
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals
dated September 26, 2003 in CA-G.R. CV No. 72859 is REVERSED and SET
ASIDE. Respondent Pedro O. Enciso’s application for registration and
issuance of title to Lot No. 2278-A, Cad. 652-D, Masinloc Cadastre, is
hereby DISMISSED for lack of merit.
SO ORDERED.

According to the CA, "the Municipality of Masinloc must have been in

possession of the subject land even before 1969 considering that it was
originally surveyed way back in 1927-1928." This is not the kind of possession
and occupation contemplated under the law. While the subject property was
still in the hands of the municipality, it was undeniably part of the public
domain. The municipality cannot then be considered a predecessor-in-
interest of the applicant from whom the period of possession and occupation
required by law may be reckoned with. Any other interpretation would be
dangerously detrimental to our national patrimony.

Even assuming that Honorato Edaño, the respondent’s earliest predecessor-

in-interest, possessed the property as early as 1969, the respondent’s claim
must still fail, as he was unable to prove open, continuous, exclusive, and
notorious possession and occupation of the subject land under a bona
fide claim of acquisition of ownership. As the Court ruled in Republic v.
Alconaba:27

The law speaks of possession and occupation. Since these words are
separated by the conjunction and, the clear intention of the law is not to
make one synonymous with the other. Possession is broader than occupation
because it includes constructive possession. When, therefore, the law adds
the word occupation, it seeks to delimit the all encompassing effect of
constructive possession. Taken together with the words open, continuous,
exclusive and notorious, the word occupation serves to highlight the fact that
for an applicant to qualify, his possession must not be a mere fiction. Actual G.R. No. 100709 November 14, 1997
REPUBLIC OF THE PHILIPPINES, represented by the DIRECTOR OF
LANDS, petitioner,
vs.
COURT OF APPEALS, JOSEFINA L. MORATO, SPOUSES NENITA CO and
ANTONIO QUILATAN AND THE REGISTER OF DEEDS OF QUEZON
PROVINCE, respondents.
PANGANIBAN, J.:
Will the lease and/or mortgage of a portion of a realty acquired through free
patent constitute sufficient ground for the nullification of such land grant?
Should such property revert to the State once it is invaded by the sea and
thus becomes foreshore land?
The Case
These are the two questions raised in the petition before us assailing the
Court of Appeals' 1 Decision in CA-G.R. CV No. 02667 promulgated on June
13, 1991 which answered the said questions in the negative. 2 Respondent
Court's dismissed 3 petitioner's appeal and affirmed in toto the decision of
the Regional Trial Court4 of Calauag, Quezon, dated December 28, 1983 in
Civil Case No. C-608. In turn, the Regional Trial Court's decision dismissed
petitioner's complaint for cancellation of the Torrens Certificate of Title of
Respondent Morato and for reversion of the parcel of land subject thereof of
the public domain.
The Facts
The petition of the solicitor general, representing the Republic of the
Philippines, recites the following facts: 5
Sometime in December, 1972, respondent Morato filed a Free Patent
Application No. III-3-8186-B on a parcel of land with an area of 1,265 square
meters situated at Pinagtalleran, Calauag, Quezon. On January 16, 1974, the
patent was approved and the Register of Deeds of Quezon at Lucena City
issued on February 4, 1974 Original Certificate of Title No. P-17789. Both the
free paten and the title specifically mandate that the land shall not
be alienated nor encumbered within five years from the date of the issuance
of the patent (Sections 118 and 124 of CA No. 141, as amended).
Subsequently, the District Land Officer in Lucena City, acting upon reports
that respondent Morato had encumbered the land in violation of the
condition of the patent, conducted an investigation. Thereafter, it was
established that the subject land is a portion of the Calauag Bay, five (5) to six
(6) feet deep under water during high tide and two (2) feet deep at low tide,
and not suitable to vegetation. Moreover, on October 24, 1974, a portion of
the land was mortgaged by respondent Morato to respondents Nenita Co
and Antonio Quilatan for P10,000.00 (pp. 2, 25, Folder of Exhibits). The
spouses Quilatan constructed a house on the land. Another portion of the
land was leased to Perfecto Advincula on February 2, 1976 at P100.00 a
month, where a warehouse was constructed.
On November 5, 1978, petitioner filed an amended complaint against
respondents Morato, spouses Nenita Co and Antonio Quilatan, and the
Register of Deeds of Quezon for the cancellation of title and reversion of a
parcel of land to the public domain, subject of a free patent in favor of
respondent Morato, on the grounds that the land is a foreshore land and was
mortgaged and leased within the five-year prohibitory period (p. 46,
Records).
After trial, the lower court, on December 28, 1983, rendered a decision
dismissing petitioner's complaint. In finding for private respondents, the
lower court ruled that there was no violation of the 5-year period ban against
alienating or encumbering the land, because the land was merely leased and
not alienated. It also found that the mortgage to Nenita Co and Antonio
Quilatan covered only the improvement and not the land itself.
On appeal, the Court of Appeals affirmed the decision of the trial court.
Thereafter, the Republic of the Philippines filed the present petition. 6
The Issues
Petitioner alleges that the following errors were committed by Respondent
Court: 7
I
Respondent court erred in holding that the patent granted and certificate of
title issued to Respondent Morato cannot be cancelled and annulled since
the certificate of title becomes indefeasible after one year from the issuance
of the title.
II
Respondent Court erred in holding that the questioned land is part of a
disposable public land and not a foreshore land.
The Court's Ruling
The petition is meritorious.
First Issue: Indefeasibility of a Free Patent Title
In resolving the first issue against petitioner, Respondent Court held: 8
. . . As ruled in Heirs of Gregorio Tengco vs. Heirs of Jose Alivalas, 168 SCRA
198. ". . . The rule is well-settled that an original certificate of title issued on
the strength of a homestead patent partakes of the nature of a certificate of
title issued in a judicial proceeding, as long as the land disposed of is really
part of the disposable land of the public domain, and becomes indefeasible
and incontrovertible upon the expiration of one year from the date of
promulgation of the order of the Director of Lands for the issuance of the
patent. (Republic v. Heirs of Carle, 105 Phil. 1227 (1959); Ingaran v. Ramelo,
107 Phil. 498 (1960); Lopez v. Padilla, (G.R. No. L-27559, May 18, 1972, 45
SCRA 44). A homestead patent, one registered under the Land Registration
Act, becomes as indefeasible as a Torrens Title. (Pamintuan v. San Agustin, 43
Phil. 558 (1982); El Hogar Filipino v. Olviga, 60 Phil. 17 (1934); Duran v. Oliva,
113 Phil. 144 (1961); Pajomayo v. Manipon, G.R. No. L-33676, June 30, 1971,
39 SCRA 676). (p. 203).
Again, in Lopez vs. Court of Appeals, 169 SCRA 271, citing Iglesia ni Cristo
v. Hon. Judge, CFI of Nueva Ecija, Branch I, (123 SCRA 516 (1983)
and Pajomayo, et al. v. Manipon, et al. (39 SCRA 676 (1971) held that once a
homestead patent granted in accordance with the Public Land Act is
registered pursuant to Section 122 of Act 496, the certificate of title issued in
virtue of said patent has the force and effect of a Torrens Title issued under
the Land Registration Act.
Indefeasibility of the title, however, may not bar the State, thru the Solicitor
General, from filing an action for reversion, as ruled in Heirs
of Gregorio Tengco v. Heirs of Jose Aliwalas, (supra), as follows:
But, as correctly pointed out by the respondent Court of Appeals, Dr.
Aliwalas' title to the property having become incontrovertible, such may no
longer be collaterally attacked. If indeed there had been any fraud or
misrepresentation in obtaining the title, an action for reversion instituted by
the Solicitor General would be the proper remedy (Sec. 101, C.A. No. 141;
Director of Lands v. Jugado, G.R. No. L-14702, May 21, 1961, 2 SCRA 32;
Lopez v. Padilla, supra). (p. 204).
Petitioner contends that the grant of Free Patent (IV-3) 275 and the
subsequent issuance of Original Certificate of Title No. P-17789 to
Respondent Josefina L. Morato were subject to the conditions provided for in
Commonwealth Act (CA) No. 141. It alleges that on October 24, 1974, or nine
(9) months and eight (8) days after the grant of the patent, mortgaged a
portion of the land" to Respondent Nenita Co, who thereafter constructed a
house thereon. Likewise, on February 2, 1976 and "within the five-year
prohibitory period," Respondent Morato "leased a portion of the land to
Perfecto Advincula at a monthly rent of P100.00 who, shortly thereafter,
constructed a house of concrete materials on the subject land." 9 Further,
petitioner argues that the defense of indefeasibility of title is "inaccurate."
The original certificate of title issued to Respondent Morato "contains the
seeds of its own cancellation": such certificate specifically states on its face
that "it is subject to the provisions of Sections 118, 119, 121, 122, 124 of CA
No. 141, as amended." 10
Respondent Morato counters by stating that although a "portion of the land
was previously leased," it resulted "from the fact that Perfecto Advincula
built a warehouse in the subject land without [her] prior consent." The
mortgage executed over the improvement "cannot be considered a violation
of the said grant since it can never affect the ownership." 11 She states
further:
. . . . the appeal of the petitioner was dismissed not because of the principle
of indefeasibility of title but mainly due to failure of the latter to support and
prove the alleged violations of respondent Morato. The records of this case
will readily show that although petitioner was able to establish that Morato
committed some acts during the prohibitory period of 5 years, a perusal
thereof will also show that what petitioner was able to prove never
constituted a violation of the grant. 12
Respondent-Spouses Quilatan, on the other hand, state that the mortgage
contract they entered into with Respondent Morato "can never be
considered as [an] 'alienation' inasmuch as the ownership over the property
remains with the owner." 13 Besides, it is the director of lands and not the
Republic of the Philippines who is the real party in interest in this case,
contrary to the provision of the Public Land Act which states that actions for
reversion should be instituted by the solicitor general in the name of
Republic of the Philippines. 14
We find for petitioner.
Quoted below are relevant sections of Commonwealth Act No. 141,
otherwise known as the Public Land Act:
Sec. 118. Except in favor of the Government or any of its branches, units or
institutions, or legally constituted banking corporations, lands acquired
under free patent or homestead provisions shall not be subject to
encumbrance or alienation from the date of the approval of the application
and for a term of five years from and after the date of issuance of the patent
or grant nor shall they become liable to the satisfaction of any debt
contracted prior to the expiration of said period; but the improvements or
crops on the land may be mortgaged or pledged to qualified persons,
associations, or corporations.
No alienation, transfer, or conveyance of any homestead after five years and
before twenty-five years after issuance of title shall be valid without the
approval of the Secretary of Agriculture and Natural Resources, which
approval shall not be denied except on constitutional and legal grounds. (As
amended by Com. Act No. 456, approved June 8, 1939.)
xxx xxx xxx
Sec. 121. Except with the consent of the grantee and the approval of the
Secretary of Agriculture and Natural Resources, and solely for educational,
religious, or charitable purposes or for a right of way, no corporation,
association, or partnership may acquire or have any right, title, interest, or
property right whatsoever to any land granted under the free patent,
homestead, or individual sale provisions of this Act or to any permanent
improvement on such land. (As amended by Com. Act No. 615, approved
May 5, 1941)
Sec. 122. No land originally acquired in any manner under the provisions of
this Act, nor any permanent improvement on such land, shall be
encumbered, alienation or transferred, except to persons, corporations,
association, or partnerships who may acquire lands of the public domain
under this Act or to corporations organized in the Philippines authorized
therefore by their charters.
Except in cases of hereditary successions, no land or any portion thereof
originally acquired under the free patent, homestead, or individual sale
provisions of this Act, or any permanent improvement on such land, shall be
transferred or assigned to any individual, nor shall such land or any
permanent improvement thereon be leased to such individual, when the
area of said land, added to that of this own, shall exceed one hundred and
forty-four hectares. Any transfer, assignment, or lease made in violation
hereto shall be null and void. (As amended by Com Act No. 615, Id.).
xxx xxx xxx
Sec. 124. Any acquisition, conveyance, alienation, transfer, or other contract
made or executed in violation of any of the provisions of sections one
hundred and eighteen, one hundred and twenty, one hundred and twenty-
one, one hundred and twenty-two, and one hundred and twenty-three of
this Act shall be unlawful and null and void from its execution and shall
produce the effect of annulling and cancelling the grant, title, patent, or
permit originally issued, recognized or confirmed, actually or presumatively,
and cause the reversion of the property and its improvements to the State.
(Emphasis supplied)
The foregoing legal provisions clearly proscribe the encumbrance of a parcel
of land acquired under a free patent or homestead within five years from the
grant of such patent. Furthermore, such encumbrance results in the
cancellation of the grant and the reversion of the land to the public domain.
Encumbrance has been defined as "[a]nything that impairs the use or
transfer of property; anything which constitutes a burden on the title; a
burden or charge upon property; a claim or lien upon property." It may be a
"legal claim on an estate for the discharge of which the estate is liable; and
embarrassment of the estate or property so that it cannot be disposed of
without being subject to it; an estate, interest, or right in lands, diminishing
their value to the general owner; a liability resting upon an estate." 15 Do the
contracts of lease and mortgage executed within five (5) years from the
issuance of the patent constitute an "encumbrance" and violate the terms
and conditions of such patent? Respondent Court answered in the
negative: 16
From the evidence adduced by both parties, it has been proved that the area
of the portion of the land, subject matter of the lease contract (Exh. "B")
executed by and between Perfecto Advincula and Josefina L. Morato is only
10 x 12 square meters, where the total area of the land granted to Morato is
1,265 square meters. It is clear from this that the portion of the land leased
by Advincula does not significantly affect Morato's ownership and
possession. Above all, the circumstances under which the lease was executed
do not reflect a voluntary and blatant intent to violate the conditions
provided for in the patent issued in her favor. On the contrary, Morato was
compelled to enter into that contract of lease
out of sympathy and the goodness of her heart to accommodate a fellow
man. . . .
It is indisputable, however, that Respondent Morato cannot fully use or
enjoy the land during the duration of the lease contract. This restriction on
the enjoyment of her property sufficiently meets the definition of an
encumbrance under Section 118 of the Public Land Act, because such
contract "impairs the use of the property" by the grantee. In a contract of
lease which is consensual, bilateral, onerous and commutative, the owner
temporarily grants the use of his or her property to another who undertakes
to pay rent therefor. 17 During the term of the lease, the grantee of the
patent cannot enjoy the beneficial use of the land leased. As already
observed, the Public Land Act does not permit a grantee of a free patent
from encumbering any portion of such land. Such encumbrance is a ground
for the nullification of the award.
Morato's resort to equity, i.e. that the lease was executed allegedly out of
the goodness of her heart without any intention of violating the law, cannot
help her. Equity, which has been aptly described as "justice outside legality,"
is applied only in the absence of, and never against, statutory law or judicial
rules of procedure. Positive rules prevail over all abstract arguments based
on equity contra legem. 18
Respondents failed to justify their position that the mortgage should not be
considered an encumbrance. Indeed, we do not find any support for such
contention. The questioned mortgage falls squarely within the term
"encumbrance" proscribed by Section 118 of the Public Land Act. 19 Verily, a
mortgage constitutes a legal limitation on the estate, and the foreclosure of
such mortgage would necessarily result in the auction of the property. 20
Even if only part of the property has been sold or alienated within the
prohibited period of five years from the issuance of the patent, such
alienation is a sufficient cause for the reversion of the whole estate to the
State. As a condition for the grant of a free patent to an applicant, the law
requires that the land should not be encumbered, sold or alienated within
five years from the issuance of
the patent. The sale or the alienation of part of the homestead violates that
condition. 21
The prohibition against the encumbrance — lease and mortgage included —
of a homestead which, by analogy applies to a free patent, is mandated by
the rationale for the grant, viz.: 22
It is well-known that the homestead laws were designed to distribute
disposable agricultural lots of the State to land-destitute citizens for their
home and cultivation. Pursuant to such benevolent intention the State
prohibits the sale or incumbrance of the homestead (Section 116) within five
years after the grant of the patent. After that five-year period the law
impliedly permits alienation of the homestead; but in line with the primordial
purpose to favor the homesteader and his family the statute provides that
such alienation or conveyance (Section 117) shall be subject to the right of
repurchase by the homesteader, his widow or heirs within five years. This
section 117 is undoubtedly a complement of section 116. It aims to preserve
and keep in the family of the homesteader that portion of public land which
the State had gratuitously given to him. It would, therefore, be in keeping
with this fundamental idea to hold, as we hold, that the right to repurchase
exists not only when the original homesteader makes the conveyance, but
also when it is made by his widow or heirs. This construction is clearly
deducible from the terms of the statute.
By express provision of Section 118 of Commonwealth Act 141 and in
conformity with the policy of the law, any transfer or alienation of a free
patent or homestead within five years from the issuance of the patent is
proscribed. Such transfer nullifies said alienation and constitutes a cause for
the reversion of the property to the State.
The prohibition against any alienation or encumbrance of the land grant is a
proviso attached to the approval of every application. 23 Prior to the
fulfillment of the requirements of law, Respondent Morato had only an
inchoate right to the property; such property remained part of the public
domain and, therefore, not susceptible to alienation or encumbrance.
Conversely, when a "homesteader has complied with all the terms and
conditions which entitled him to a patent for [a] particular tract of public
land, he acquires a vested interest therein and has to be regarded an
equitable owner thereof." 24 However, for Respondent Morato's title of
ownership over the patented land to be perfected, she should have complied
with the requirements of the law, one of which was to keep the property for
herself and her family within the prescribed period of five (5) years. Prior to
the fulfillment of all requirements of the law, Respondent Morato's title over
the property was incomplete. Accordingly, if the requirements are not
complied with, the State as the grantor could petition for the annulment of
the patent and the cancellation of the title.
Respondent Morato cannot use the doctrine of the indefeasibility of her
Torrens title to bar the state from questioning its transfer or encumbrance.
The certificate of title issued to her clearly stipulated that its award was
"subject to the conditions provided for in Sections 118, 119, 121, 122 and
124 of Commonwealth Act (CA) No. 141." Because she violated Section 118,
the reversion of the property to the public domain necessarily follows,
pursuant to Section 124.
Second Issue: Foreshore Land
Revert to the Public Domain
There is yet another reason for granting this petition.
Although Respondent Court found that the subject land was foreshore land,
it nevertheless sustained the award thereof to Respondent Morato: 25
First of all, the issue here is whether the land in question, is really part of the
foreshore lands. The Supreme Court defines foreshore land in the case
of Republic vs. Alagad, 169 SCRA 455, 464, as follows:
Otherwise, where the rise in water level is due to, the "extraordinary" action
of nature, rainful, for instance, the portions inundated thereby are not
considered part of the bed or basin of the body of water in question. It
cannot therefore be said to be foreshore land but land outside of the public
dominion, and land capable of registration as private property.
A foreshore land, on the other hand has been defined as follows:
. . . that part of (the land) which is between high
and low water and left dry by the flux and reflux of the tides . . . . (Republic
vs. C.A., Nos. L-43105, L-43190, August 31, 1984, 131 SCRA 532; Government
vs. Colegio de San Jose, 53 Phil 423)
The strip of land that lies between the high and low water marks and that is
alternatively wet and dry according to the flow of the tide. (Rep. vs.
CA, supra, 539).
The factual findings of the lower court regarding the nature of the parcel of
land in question reads:
Evidence disclose that the marginal area of the land radically changed
sometime in 1937 up to 1955 due to a strong earthquake followed by
frequent storms eventually eroding the land. From 1955 to 1968, however,
gradual reclamation was undertaken by the lumber company owned by the
Moratos. Having thus restored the land thru mostly human hands employed
by the lumber company, the area continued to be utilized by the owner of
the sawmill up to the time of his death in 1965. On or about March 17, 1973,
there again was a strong earthquake unfortunately causing destruction to
hundreds of residential houses fronting the Calauag Bay including the
Santiago Building, a cinema house constructed of concrete materials. The
catastrophe totally caused the sinking of a concrete bridge at Sumulong river
also in the municipality of Calauag, Quezon.
On November 13, 1977 a typhoon code named "Unding" wrought havoc as it
lashed the main land of Calauag, Quezon causing again great erosion this
time than that which the area suffered in 1937. The Court noted with the
significance of the newspaper clipping entitled "Baryo ng Mangingisda Kinain
ng Dagat" (Exh. "11").
x x x           x x x          x x x
Evidently this was the condition of the land when on or about December 5,
1972 defendant Josefina L. Morato filed with the Bureau of Lands her free
patent application. The defendant Josefina Morato having taken possession
of the land after the demise of Don Tomas Morato, she introduced
improvement and continued developing the area, planted it to coconut tree.
Having applied for a free patent, defendant had the land area surveyed and
an approved plan (Exh. "9") based on the cadastral survey as early as 1927
(Exh. "10") was secured. The area was declared for taxation purposes in the
name of defendant Josefina Morato denominated as Tax Declaration No.
4115 (Exh. "8") and the corresponding realty taxes religiously paid as shown
by Exh. "8-A"). (pp. 12-14, DECISION).
Being supported by substantial evidence and for failure of the appellant to
show cause which would warrant disturbance, the aforecited findings of the
lower court, must be respected.
Petitioner correctly contends, however, that Private Respondent Morato
cannot own foreshore land:
Through the encroachment or erosion by the ebb and flow of the tide, a
portion of the subject land was invaded by the waves and sea advances.
During high tide, at least half of the land (632.5 square meters) is 6 feet deep
under water and three (3) feet deep during low tide. The Calauag Bay shore In comparison, Article 420 of the Civil Code provides:
has extended up to a portion of the questioned land.
Art. 420. The following things are property of public dominion:
While at the time of the grant of free patent to respondent Morato, the land
was not reached by the water, however, due to gradual sinking of the land (1) Those intended for public use, such as roads, canals, rivers, torrents, ports
caused by natural calamities, the sea advances had permanently invaded a and bridges constructed by the State, banks, shores, roadsteads, and others
portion of subject land. As disclosed at the trial, through the testimony of the of similar character;
court-appointed commissioner, Engr. Abraham B. Pili, the land was under
(2) Those which belong to the State, without being for public use, and are
water during high tide in the month of August 1978. The water margin covers
intended for some public service or for the development of the national
half of the property, but during low tide, the water is about a kilometer (TSN,
wealth.
July 19, 1979, p. 12). Also, in 1974, after the grant of the patent, the land was
covered with vegetation, but it disappeared in 1978 when the land was When the sea moved towards the estate and the tide invaded it, the invaded
reached by the tides (Exh. "E-1", "E-14"). In fact, in its decision dated property became foreshore land and passed to the realm of the public
December 28, 1983, the lower court observed that the erosion of the land domain. In fact, the Court in Government vs. Cabangis 30 annulled the
was caused by natural calamities that struck the place in 1977 (Cf. Decision, registration of land subject of cadastral proceedings when the parcel
pp. 17-18). 26 subsequently became foreshore land. 31 In another case, the Court voided the
registration decree of a trial court and held that said court had no jurisdiction
Respondent-Spouses Quilatan argue, however, that it is "unfair and unjust if
to award foreshore land to any private person or entity. 32 The subject land in
Josefina Morato will be deprived of the whole property just because a
this case, being foreshore land, should therefore be returned to the public
portion thereof was immersed in water for reasons not her own doing." 27
domain.
As a general rule, findings of facts of the Court of Appeals are binding and
WHEREFORE, the petition is GRANTED. This Court hereby REVERSES and SETS
conclusive upon this Court, unless such factual findings are palpably
ASIDE the assailed Decision of Respondent Court and ORDERS the
unsupported by the evidence on record or unless the judgment itself is based
CANCELLATION of Free Patent No. (IV-3) 275 issued to Respondent Morato
on a misapprehension of facts. 28 The application for a free patent was made
and the subsequent Original Certificate of Title No. P-17789. The subject land
in 1972. From the undisputed factual findings of the Court of Appeals,
therefore REVERTS to the State. No costs.
however, the land has since become foreshore. Accordingly, it can no longer
be subject of a free patent under the Public Land Act. Government of the SO ORDERED.
Philippine Islands vs. Cabañgis  29 explained the rationale for this proscription:

Article 339, subsection 1, of the Civil Code, reads:

Art. 339. Property of public ownership is —

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

xxx xxx xxx

Article 1, case 3, of the law of Waters of August 3, 1866, provides as follows:

Art. 1. The following are part of the national domain open to public use.

xxx xxx xxx

3. The Shores. By the shore is understood that space covered and uncovered
by the movement of the tide. Its interior or terrestrial limit is the line reached
by the highest equinoctal tides. Where the tides are not appreciable, the
shore begins on the land side at the line reached by the sea during ordinary
storms or tempests.

In the case of Aragon vs. Insular Government (19 Phil. 223), with reference to

article 339 of the Civil Code just quoted, this Court said:

We should not be understood, by this decision, to hold that in a case of

gradual encroachment or erosion by the ebb and flow of the tide, private
property may not become "property of public ownership." as defined in
article 339 of the code, where it appear that the owner has to all intents and
purposes abandoned it and permitted it to be totally destroyed, so as to
become a part of the "playa" (shore of the sea), "rada" (roadstead), or the
like. . . .

In the Enciclopedia Juridica Española, volume XII, page 558, we read the

following:

With relative frequency the opposite phenomenon occurs; that is, the sea
advances and private properties are permanently invaded by the waves, and
in this case they become part of the shore or breach. The then pass to the
public domain, but the owner thus dispossessed does not retain any right to
the natural products resulting from their new nature; it is a de facto case of
eminent domain, and not subject to indemnity.
G.R. No. 149927             March 30, 2004
REPUBLIC OF THE PHILIPPINES, Represented by the Department of
Environment and Natural Resources (DENR)
Under then Minister ERNESTO R. MACEDA; and Former Government
Officials CATALINO MACARAIG, FULGENCIO S. FACTORAN, ANGEL C.
ALCALA, BEN MALAYANG, ROBERTO PAGDANGANAN, MARIANO Z. VALERA
and ROMULO SAN JUAN, petitioners,
vs.
ROSEMOOR MINING AND DEVELOPMENT CORPORATION, PEDRO DEL
CONCHA, and ALEJANDRO and RUFO DE GUZMAN, respondents.
DECISION
PANGANIBAN, J.:
A mining license that contravenes a mandatory provision of the law under
which it is granted is void. Being a mere privilege, a license does not vest
absolute rights in the holder. Thus, without offending the due process and
the non-impairment clauses of the Constitution, it can be revoked by the
State in the public interest.
The Case
Before us is a Petition for Review1 under Rule 45 of the Rules of Court,
seeking to nullify the May 29, 2001 Decision2 and the September 6, 2001
Resolution3 of the Court of Appeals (CA) in CA-GR SP No. 46878. The CA
disposed as follows:
"WHEREFORE, premises considered, the appealed Decision is hereby
AFFIRMED in toto."4
The questioned Resolution denied petitioners’ Motion for Reconsideration.
On the other hand, trial court’s Decision, which was affirmed by the CA, had
disposed as follows:
"WHEREFORE, judgment is hereby rendered as follows:
‘1. Declaring that the cancellation of License No. 33 was done without
jurisdiction and in gross violation of the Constitutional right of the petitioners
against deprivation of their property rights without due process of law and is
hereby set aside.
‘2. Declaring that the petitioners’ right to continue the exploitation of the
marble deposits in the area covered by License No. 33 is maintained for the
duration of the period of its life of twenty-five (25) years, less three (3) years
of continuous operation before License No. 33 was cancelled, unless sooner
terminated for violation of any of the conditions specified therein, with due
process.
‘3. Making the Writ of preliminary injunction and the Writ of Preliminary
Mandatory Injunction issued as permanent.
‘4. Ordering the cancellation of the bond filed by the Petitioners in the sum
of 1 Million.
‘5. Allowing the petitioners to present evidence in support of the damages
they claim to have suffered from, as a consequence of the summary
cancellation of License No. 33 pursuant to the agreement of the parties on
such dates as maybe set by the Court; and
‘6. Denying for lack of merit the motions for contempt, it appearing that
actuations of the respondents were not contumacious and intended to delay
the proceedings or undermine the integrity of the Court.
‘No pronouncement yet as to costs.’"5
The Facts
The CA narrated the facts as follows:
"The four (4) petitioners, namely, Dr. Lourdes S. Pascual, Dr. Pedro De la
Concha, Alejandro De La Concha, and Rufo De Guzman, after having been
granted permission to prospect for marble deposits in the mountains of Biak-
na-Bato, San Miguel, Bulacan, succeeded in discovering marble deposits of
high quality and in commercial quantities in Mount Mabio which forms part
of the Biak-na-Bato mountain range.
"Having succeeded in discovering said marble deposits, and as a result of
their tedious efforts and substantial expenses, the petitioners applied with
the Bureau of Mines, now Mines and Geosciences Bureau, for the issuance of
the corresponding license to exploit said marble deposits.
xxxxxxxxx
"After compliance with numerous required conditions, License No. 33 was
issued by the Bureau of Mines in favor of the herein petitioners.
xxxxxxxxx
"Shortly after Respondent Ernesto R. Maceda was appointed Minister of the
Department of Energy and Natural Resources (DENR), petitioners’ License
No. 33 was cancelled by him through his letter to ROSEMOOR MINING AND
DEVELOPMENT CORPORATION dated September 6, 1986 for the reasons
stated therein. Because of the aforesaid cancellation, the original petition
was filed and later substituted by the petitioners’ AMENDED PETITION dated
August 21, 1991 to assail the same.
"Also after due hearing, the prayer for injunctive relief was granted in the
Order of this Court dated February 28, 1992. Accordingly, the corresponding
preliminary writs were issued after the petitioners filed their injunction bond
in the amount of ONE MILLION PESOS (₱1,000,000.00).
xxxxxxxxx
"On September 27, 1996, the trial court rendered the herein questioned
decision."6
The trial court ruled that the privilege granted under respondents’ license
had already ripened into a property right, which was protected under the
due process clause of the Constitution. Such right was supposedly violated
when the license was cancelled without notice and hearing. The cancellation
was said to be unjustified, because the area that could be covered by the
four separate applications of respondents was 400 hectares. Finally,
according to the RTC, Proclamation No. 84, which confirmed the cancellation
of the license, was an ex post facto law; as such, it violated Section 3 of
Article XVIII of the 1987 Constitution.
On appeal to the Court of Appeals, herein petitioners asked whether PD 463
or the Mineral Resources Development Decree of 1974 had been violated by
the award of the 330.3062 hectares to respondents in accordance with
Proclamation No. 2204. They also questioned the validity of the cancellation
of respondents’ Quarry License/Permit (QLP) No. 33.
Ruling of the Court of Appeals
Sustaining the trial court in toto, the CA held that the grant of the quarry
license covering 330.3062 hectares to respondents was authorized by law,
because the license was embraced by four (4) separate applications -- each
for an area of 81 hectares. Moreover, it held that the limitation under
Presidential Decree No. 463 -- that a quarry license should cover not more
than 100 hectares in any given province -- was supplanted by Republic Act
No. 7942,7 which increased the mining areas allowed under PD 463.
It also ruled that the cancellation of respondents’ license without notice and
hearing was tantamount to a deprivation of property without due process of
law. It added that under the clause in the Constitution dealing with the non-
impairment of obligations and contracts, respondents’ license must be
respected by the State.
Hence, this Petition.8
Issues
Petitioners submit the following issues for the Court’s consideration:
"(1) [W]hether or not QLP No. 33 was issued in blatant contravention of
Section 69, P.D. No. 463; and (2) whether or not Proclamation No. 84 issued
by then President Corazon Aquino is valid. The corollary issue is whether or
not the Constitutional prohibition against ex post facto law applies to
Proclamation No. 84"9
The Court’s Ruling
The Petition has merit.
First Issue:
Validity of License
Respondents contend that the Petition has no legal basis, because PD 463
has already been repealed.10 In effect, they ask for the dismissal of the
Petition on the ground of mootness.
PD 463, as amended, pertained to the old system of exploration,
development and utilization of natural resources through licenses,
concessions or leases.11 While these arrangements were provided under the
193512 and the 197313 Constitutions, they have been omitted by Section 2 of
Article XII of the 1987 Constitution.14
With the shift of constitutional policy toward "full control and supervision of
the State" over natural resources, the Court in Miners Association of the
Philippines v. Factoran Jr. 15 declared the provisions of PD 463 as contrary to
or violative of the express mandate of the 1987 Constitution. The said
provisions dealt with the lease of mining claims; quarry permits or licenses
covering privately owned or public lands; and other related provisions on
lease, licenses and permits.
RA 7942 or the Philippine Mining Act of 1995 embodies the new
constitutional mandate. It has repealed or amended all laws, executive
orders, presidential decrees, rules and regulations -- or parts thereof -- that
are inconsistent with any of its provisions.16
It is relevant to state, however, that Section 2 of Article XII of the 1987
Constitution does not apply retroactively to a "license, concession or lease"
granted by the government under the 1973 Constitution or before the
effectivity of the 1987 Constitution on February 2, 1987.17 As noted in Miners
Association of the Philippines v. Factoran Jr., the deliberations of the
Constitutional Commission18 emphasized the intent to apply the said
constitutional provision prospectively.
While RA 7942 has expressly repealed provisions of mining laws that are
inconsistent with its own, it nonetheless respects previously issued valid and
existing licenses, as follows:
"SECTION 5. Mineral Reservations. — When the national interest so requires,
such as when there is a need to preserve strategic raw materials for
industries critical to national development, or certain minerals for scientific,
cultural or ecological value, the President may establish mineral reservations
upon the recommendation of the Director through the Secretary. Mining
operations in existing mineral reservations and such other reservations as
may thereafter be established, shall be undertaken by the Department or
through a contractor: Provided, That a small scale-mining cooperative
covered by Republic Act No. 7076 shall be given preferential right to apply
for a small-scale mining agreement for a maximum aggregate area of twenty-
five percent (25%) of such mineral reservation, subject to valid existing
mining/quarrying rights as provided under Section 112 Chapter XX hereof. All
submerged lands within the contiguous zone and in the exclusive economic
zone of the Philippines are hereby declared to be mineral reservations.
"x x x x x x x x x
"SECTION 7. Periodic Review of Existing Mineral Reservations. — The
Secretary shall periodically review existing mineral reservations for the
purpose of determining whether their continued existence is consistent with
the national interest, and upon his recommendation, the President may, by
proclamation, alter or modify the boundaries thereof or revert the same to
the public domain without prejudice to prior existing rights."
"SECTION 18. Areas Open to Mining Operations. — Subject to any existing
rights or reservations and prior agreements of all parties, all mineral
resources in public or private lands, including timber or forestlands as
defined in existing laws, shall be open to mineral agreements or financial or
technical assistance agreement applications. Any conflict that may arise
under this provision shall be heard and resolved by the panel of arbitrators."
"SECTION 19. Areas Closed to Mining Applications. -- Mineral agreement or
financial or technical assistance agreement applications shall not be allowed:
(a) In military and other government reservations, except upon prior written
clearance by the government agency concerned;
(b) Near or under public or private buildings, cemeteries, archeological and
historic sites, bridges, highways, waterways, railroads, reservoirs, dams or
other infrastructure projects, public or private works including plantations or
valuable crops, except upon written consent of the government agency or
private entity concerned;
(c) In areas covered by valid and existing mining rights;
(d) In areas expressly prohibited by law;
(e) In areas covered by small-scale miners as defined by law unless with prior
consent of the small-scale miners, in which case a royalty payment upon the
utilization of minerals shall be agreed upon by the parties, said royalty
forming a trust fund for the socioeconomic development of the community
concerned; and
(f) Old growth or virgin forests, proclaimed watershed forest reserves,
wilderness areas, mangrove forests, mossy forests, national parks,
provincial/municipal forests, parks, greenbelts, game refuge and bird
sanctuaries as defined by law and in areas expressly prohibited under the
National Integrated Protected Areas System (NIPAS) under Republic Act No.
7586, Department Administrative Order No. 25, series of 1992 and other
laws."
"SECTION 112. Non-impairment of Existing Mining/ Quarrying Rights. — All
valid and existing mining lease contracts, permits/licenses, leases pending
renewal, mineral production-sharing agreements granted under Executive
Order No. 279, at the date of effectivity of this Act, shall remain valid, shall
not be impaired, and shall be recognized by the Government: Provided, That
the provisions of Chapter XIV on government share in mineral production-
sharing agreement and of Chapter XVI on incentives of this Act shall
immediately govern and apply to a mining lessee or contractor unless the
mining lessee or contractor indicates his intention to the secretary, in
writing, not to avail of said provisions: Provided, further, That no renewal of
mining lease contracts shall be made after the expiration of its term:
Provided, finally, That such leases, production-sharing agreements, financial
or technical assistance agreements shall comply with the applicable
provisions of this Act and its implementing rules and regulations.
"SECTION 113. Recognition of Valid and Existing Mining Claims and
Lease/Quarry Application. — Holders of valid and existing mining claims,
lease/quarry applications shall be given preferential rights to enter into any
mode of mineral agreement with the government within two (2) years from
the promulgation of the rules and regulations implementing this Act."
(Underscoring supplied)
Section 3(p) of RA 7942 defines an existing mining/quarrying right as "a valid
and subsisting mining claim or permit or quarry permit or any mining lease
contract or agreement covering a mineralized area granted/issued under
pertinent mining laws." Consequently, determining whether the license of
respondents falls under this definition would be relevant to fixing their
entitlement to the rights and/or preferences under RA 7942. Hence, the
present Petition has not been mooted.
Petitioners submit that the license clearly contravenes Section 69 of PD 463,
because it exceeds the maximum area that may be granted. This incipient
violation, according to them, renders the license void ab initio.
Respondents, on the other hand, argue that the license was validly granted,
because it was covered by four separate applications for areas of 81 hectares
each.
The license in question, QLP No. 33,19 is dated August 3, 1982, and it was
issued in the name of Rosemoor Mining Development Corporation. The
terms of the license allowed the corporation to extract and dispose of
marbleized limestone from a 330.3062-hectare land in San Miguel, Bulacan.
The license is, however, subject to the terms and conditions of PD 463, the
governing law at the time it was granted; as well as to the rules and
regulations promulgated thereunder.20 By the same token, Proclamation No.
2204 -- which awarded to Rosemoor the right of development, exploitation,
and utilization of the mineral site -- expressly cautioned that the grant was
subject to "existing policies, laws, rules and regulations." 21
The license was thus subject to Section 69 of PD 463, which reads:
"Section 69. Maximum Area of Quarry License – Notwithstanding the
provisions of Section 14 hereof, a quarry license shall cover an area of not
more than one hundred (100) hectares in any one province and not more
than one thousand (1,000) hectares in the entire Philippines." (Italics
supplied)
The language of PD 463 is clear. It states in categorical and mandatory terms
that a quarry license, like that of respondents, should cover a maximum of
100 hectares in any given province. This law neither provides any exception
nor makes any reference to the number of applications for a license. Section
69 of PD 463 must be taken to mean exactly what it says. Where the law is
clear, plain, and free from ambiguity, it must be given its literal meaning and
applied without attempted interpretation.22
Moreover, the lower courts’ ruling is evidently inconsistent with the fact that
QLP No. 33 was issued solely in the name of Rosemoor Mining and
Development Corporation, rather than in the names of the four individual
stockholders who are respondents herein. It likewise brushes aside a basic
postulate that a corporation has a separate personality from that of its
stockholders.23
The interpretation adopted by the lower courts is contrary to the purpose of
Section 69 of PD 463. Such intent to limit, without qualification, the area of a
quarry license strictly to 100 hectares in any one province is shown by the
opening proviso that reads: "Notwithstanding the provisions of Section 14
hereof x x x." The mandatory nature of the provision is also underscored by
the use of the word shall. Hence, in the application of the 100-hectare-per-
province limit, no regard is given to the size or the number of mining claims
under Section 14, which we quote:
"SECTION 14. Size of Mining Claim. -- For purposes of registration of a mining
claim under this Decree, the Philippine territory and its shelf are hereby
divided into meridional blocks or quadrangles of one-half minute (1/2) of
latitude and longitude, each block or quadrangle containing area of eighty-
one (81) hectares, more or less.
"A mining claim shall cover one such block although a lesser area may be
allowed if warranted by attendant circumstances, such as geographical and
other justifiable considerations as may be determined by the Director:
Provided, That in no case shall the locator be allowed to register twice the
area allowed for lease under Section 43 hereof." (Italics supplied)
Clearly, the intent of the law would be brazenly circumvented by ruling that a
license may cover an area exceeding the maximum by the mere expediency
of filing several applications. Such ruling would indirectly permit an act that is
directly prohibited by the law.
Second Issue:
Validity of Proclamation No. 84
Petitioners also argue that the license was validly declared a nullity and
consequently withdrawn or terminated. In a letter dated September 15,
1986, respondents were informed by then Minister Ernesto M. Maceda that
their license had illegally been issued, because it violated Section 69 of PD
463; and that there was no more public interest served by the continued
existence or renewal of the license. The latter reason, they added, was
confirmed by the language of Proclamation No. 84. According to this law,
public interest would be served by reverting the parcel of land that was
excluded by Proclamation No. 2204 to the former status of that land as part
of the Biak-na-Bato national park.
They also contend that Section 74 of PD 463 would not apply, because
Minister Maceda’s letter did not cancel or revoke QLP No. 33, but merely
declared the latter’s nullity. They further argue that respondents waived
notice and hearing in their application for the license.
On the other hand, respondents submit that, as provided for in Section 74 of
PD 463, their right to due process was violated when their license was
cancelled without notice and hearing. They likewise contend that
Proclamation No. 84 is not valid for the following reasons: 1) it violates the
clause on the non-impairment of contracts; 2) it is an ex post facto law
and/or a bill of attainder; and 3) it was issued by the President after the
effectivity of the 1987 Constitution.
This Court ruled on the nature of a natural resource exploration permit,
which was akin to the present respondents’ license, in Southeast Mindanao
Gold Mining Corporation v. Balite Portal Mining Cooperative,24 which held:
"x x x. As correctly held by the Court of Appeals in its challenged decision, EP
No. 133 merely evidences a privilege granted by the State, which may be
amended, modified or rescinded when the national interest so requires. This
is necessarily so since the exploration, development and utilization of the
country’s natural mineral resources are matters impressed with great public
interest. Like timber permits, mining exploration permits do not vest in the
grantee any permanent or irrevocable right within the purview of the non-
impairment of contract and due process clauses of the Constitution, since the
State, under its all-encompassing police power, may alter, modify or amend
the same, in accordance with the demands of the general welfare." 25
This same ruling had been made earlier in Tan v. Director of Forestry 26 with
regard to a timber license, a pronouncement that was reiterated in Ysmael v.
Deputy Executive Secretary,27 the pertinent portion of which reads:
"x x x. Timber licenses, permits and license agreements are the principal
instruments by which the State regulates the utilization and disposition of
forest resources to the end that public welfare is promoted. And it can hardly
be gainsaid that they merely evidence a privilege granted by the State to
qualified entities, and do not vest in the latter a permanent or irrevocable
right to the particular concession area and the forest products therein. They
may be validly amended, modified, replaced or rescinded by the Chief
Executive when national interests so require. Thus, they are not deemed
contracts within the purview of the due process of law clause [See Sections
3(ee) and 20 of Pres. Decree No. 705, as amended. Also, Tan v. Director of
Forestry, G.R. No. L-24548, October 27, 1983, 125 SCRA 302]."28 (Italics
supplied)
In line with the foregoing jurisprudence, respondents’ license may be
revoked or rescinded by executive action when the national interest so
requires, because it is not a contract, property or a property right protected
by the due process clause of the Constitution.29 Respondents themselves
acknowledge this condition of the grant under paragraph 7 of QLP No. 33,
which we quote:
"7. This permit/license may be revoked or cancelled at any time by the
Director of Mines and Geo-Sciences when, in his opinion public interests so
require or, upon failure of the permittee/licensee to comply with the
provisions of Presidential Decree No. 463, as amended, and the rules and
regulations promulgated thereunder, as well as with the terms and
conditions specified herein; Provided, That if a permit/license is cancelled, or
otherwise terminated, the permittee/licensee shall be liable for all unpaid
rentals and royalties due up to the time of the termination or cancellation of WHEREFORE, this Petition is hereby GRANTED and the appealed Decision of
the permit/license[.]"30 (Italics supplied) the Court of Appeals SET ASIDE. No costs.

The determination of what is in the public interest is necessarily vested in the SO ORDERED.
State as owner of all mineral resources. That determination was based on
policy considerations formally enunciated in the letter dated September 15,
1986, issued by then Minister Maceda and, subsequently, by the President
through Proclamation No. 84. As to the exercise of prerogative by Maceda,
suffice it to say that while the cancellation or revocation of the license is
vested in the director of mines and geo-sciences, the latter is subject to the
former’s control as the department head. We also stress the clear
prerogative of the Executive Department in the evaluation and the
consequent cancellation of licenses in the process of its formulation of
policies with regard to their utilization. Courts will not interfere with the
exercise of that discretion without any clear showing of grave abuse of
discretion.31

Moreover, granting that respondents’ license is valid, it can still be validly

revoked by the State in the exercise of police power. 32 The exercise of such
power through Proclamation No. 84 is clearly in accord with jura regalia,
which reserves to the State ownership of all natural resources. 33 This Regalian
doctrine is an exercise of its sovereign power as owner of lands of the public
domain and of the patrimony of the nation, the mineral deposits of which are
a valuable asset.34

Proclamation No. 84 cannot be stigmatized as a violation of the non-

impairment clause. As pointed out earlier, respondents’ license is not a
contract to which the protection accorded by the non-impairment clause
may extend.35 Even if the license were, it is settled that provisions of existing
laws and a reservation of police power are deemed read into it, because it
concerns a subject impressed with public welfare.36 As it is, the non-
impairment clause must yield to the police power of the state. 37

We cannot sustain the argument that Proclamation No. 84 is a bill of

attainder; that is, a "legislative act which inflicts punishment without judicial
trial."38 Its declaration that QLP No. 33 is a patent nullity39 is certainly not a
declaration of guilt. Neither is the cancellation of the license a punishment
within the purview of the constitutional proscription against bills of
attainder.

Too, there is no merit in the argument that the proclamation is an ex post

facto law. There are six recognized instances when a law is considered as
such: 1) it criminalizes and punishes an action that was done before the
passing of the law and that was innocent when it was done; 2) it aggravates a
crime or makes it greater than it was when it was committed; 3) it changes
the punishment and inflicts one that is greater than that imposed by the law
annexed to the crime when it was committed; 4) it alters the legal rules of
evidence and authorizes conviction upon a less or different testimony than
that required by the law at the time of the commission of the offense; 5) it
assumes the regulation of civil rights and remedies only, but in effect
imposes a penalty or a deprivation of a right as a consequence of something
that was considered lawful when it was done; and 6) it deprives a person
accused of a crime of some lawful protection to which he or she become
entitled, such as the protection of a former conviction or an acquittal or the
proclamation of an amnesty.40 Proclamation No. 84 does not fall under any of
the enumerated categories; hence, it is not an ex post facto law.

It is settled that an ex post facto law is limited in its scope only to matters
criminal in nature.41 Proclamation 84, which merely restored the area
excluded from the Biak-na-Bato national park by canceling respondents’
license, is clearly not penal in character.

Finally, it is stressed that at the time President Aquino issued Proclamation

No. 84 on March 9, 1987, she was still validly exercising legislative powers
under the Provisional Constitution of 1986.42 Section 1 of Article II of
Proclamation No. 3, which promulgated the Provisional Constitution, granted
her legislative power "until a legislature is elected and convened under a new
Constitution." The grant of such power is also explicitly recognized and
provided for in Section 6 of Article XVII of the 1987 Constitution.43
G.R. No. 129682      March 21, 2002
NESTOR PAGKATIPUNAN and ROSALINA MAÑAGAS-
PAGKATIPUNAN, petitioners,
vs.
THE COURT OF APPEALS and REPUBLIC OF THE PHILIPPINES, respondents.
YNARES-SANTIAGO, J.:
This is a petition for review of the decision1 of the Court of Appeals nullifying
the decision of the Court of First Instance of Gumaca, Quezon2 which
confirmed petitioners’ title over the lots subject of the instant petition.
Petitioners further seek to annul and set aside the resolutions3 of the Court
of Appeals denying their urgent motion to recall the judgment entered4 in
the land registration case.
The antecedent facts are as follows:
Sometime in November 1960, petitioners’ predecessors-in-interest, spouses
Getulio Pagkatipunan and Lucrecia Esquires, filed with the Court of First
Instance of Gumaca, Quezon an application for judicial confirmation and
registration of their title to Lots 1 and 2 of Plan Psu-174406 and Lots 1 and 2
of Plan Psu-112066, all located in San Narciso, Quezon.5
On May 4, 1961, the Court of First Instance entered an order of default
against the whole world, except spouses Felicisimo Almace and Teodulo
Medenilla who were given ten (10) days to file their written opposition as
regards Lot No. 2 of Plan Psu-174406. Upon motion of petitioner’s
predecessors, Lot No. 2 of Plan Psu-174406 was removed from the coverage
of the application. The remaining parcel of land covered by Lot No. 1 has an
area of 3,804.261 square meters.
On June 15, 1967, the Court of First Instance promulgated a decision
confirming petitioners’ title to the property. On October 23, 1967, OCT No.
O-12665 was issued in the name of petitioners.1âwphi1.nêt
Almost eighteen (18) years later, or on September 12, 1985, the Republic of
the Philippines filed with the Intermediate Appellate Court an action to
declare the proceedings in LRC Case No. 91-G, LRC Record No. N-19930
before the Court of First Instance of Gumaca, Quezon null and void, and to
cancel Original Certificate of Title No. 0-12665 and titles derived therefrom as
null and void, to direct the register of deeds to annul said certificates of title,
and to confirm the subject land as part of the public domain.6
The Republic claimed that at the time of filing of the land registration case
and of rendition of the decision on June 15, 1967, the subject land was
classified as timberland under LC Project No. 15-B of San Narciso, Quezon, as
shown in BF Map No. LC-1180; hence inalienable and not subject to
registration. Moreover, petitioners’ title thereto can not be confirmed for
lack of showing of possession and occupation of the land in the manner and
for the length of time required by Section 48(b), Commonwealth Act No. 141,
as amended. Neither did petitioners have any fee simple title which may be
registered under Act No. 496, as amended. Consequently, the Court of First
Instance did not acquire jurisdiction over the res and any proceedings had
therein were null and void.7
On the other hand, petitioners raised the special defenses of indefeasibility
of title and res judicata. They argued that due to the lapse of a considerable
length of time, the judgment of the Court of First Instance of Quezon in the
land registration case has become final and conclusive against the Republic.
Moreover, the action for reversion of the land to the public domain is barred
by prior judgment.8
In a decision promulgated on June 27, 1986, the Intermediate Appellate
Court held that the land in question was forestral land; hence not registrable.
There was no evidence on record to show that the land was actually and
officially delimited and classified as alienable or disposable land of the public
domain. Therefore, the Court of First Instance did not acquire jurisdiction to
take cognizance of the application for registration and to decide the same.
Consequently, the action to declare null and void the June 15, 1967 decision
for lack of jurisdiction did not prescribe. The dispositive portion of the
appellate court’s decision reads:
WHEREFORE, judgment is rendered in favor of petitioner and against
respondents, and as prayed for:
(a) The Decision dated June 15, 1967 in LRC Case No. 91-G, LRC Record No. N-
19930 is hereby declared null and void, and accordingly set aside;
(b) Original Certificate of Title No. O-12665, and Transfer Certificates of Title
Nos. T-84439, T-93857 and T-117618 deriving therefrom, as well as any other
derivative titles, are declared null and void;
(c) The respondent Register of Deeds for Quezon Province is ordered to
cancel said titles; and
(d) The parcels of land covered thereby are ordered reverted to the State.
Without pronouncement as to costs."9
On July 16, 1986, petitioners moved for the reconsideration of the afore-
cited decision10 reiterating that the land in question was agricultural because
it was possessed and cultivated as such long before its classification as
timberland by the Bureau of Forestry in 1955. Petitioners and their
predecessors-in-interest have been in open, continuous, exclusive, notorious
possession and occupation of said land for agricultural and cattle raising
purposes as far back as the Spanish regime. Following the doctrine in Oracoy
v. Director of Lands,11 private interest had intervened and petitioners
acquired vested rights which can no longer be impaired by the subsequent
classification of the land as timberland by the Director of Forestry.
On August 20, 1986, the appellate court denied the motion for
reconsideration for lack of merit.12 On December 12, 1986, the decision of
June 27, 1986 attained finality and judgment was entered in the book of
entries of judgments.13
On April 2, 1987, petitioners filed an urgent motion to set aside entry of
judgment on the ground that Atty. Cirilo E. Doronila, petitioners’ counsel of
record, was not furnished a copy of the resolution denying the motion for
reconsideration.14 In the absence of such notice, the decision of the appellate
court did not become final and executory.
On October 22, 1987, the Court of Appeals set aside and lifted the entry of
judgment in CA-G. R. SP No. 07115 and directed the clerk of court to furnish
petitioners’ counsel a copy of the August 20, 1986 resolution.15
For petitioners’ inaction despite service of the August 20, 1986 resolution,
the June 27, 1986 decision became final and executory. On March 2, 1988,
entry of judgment was again made in the land registration case.
On September 4, 1995, Atty. Doronila withdrew his appearance as counsel
for petitioners.16
On April 1, 1996, petitioners, through their new counsel, Atty. George I.
Howard, filed with the Court of Appeals an urgent motion to recall the entry
of judgment,17 which was denied by the appellate court on December 16,
1996.18
The motion for reconsideration was likewise denied on the ground that it
raised arguments already discussed and resolved in the urgent motion to
recall entry of judgment.19
Hence, the instant petition for review.20
Petitioners claim that their title to the land became incontrovertible and
indefeasible one (1) year after issuance of the decree of registration. Hence,
the Republic’s cause of action was barred by prescription and res judicata,
proceedings having been initiated only after about 18 years from the time
the decree of registration was made. Contrary to the appellate court’s
findings, the land is agricultural and the inclusion and classification thereof
by the Bureau of Forestry in 1955 as timberland can not impair the vested
rights acquired by petitioners’ predecessors-in-interest who have been in
open, continuous, adverse and public possession of the land in question since
time immemorial and for more than thirty (30) years prior to the filing of the
application for registration in 1960. Hence, the Court of Appeals committed
grave error when it denied their motion to set aside entry of judgment in the
land registration case.
The petition lacks merit.
Unless public land is shown to have been reclassified or alienated to a private
person by the State, it remains part of the inalienable public domain.
Occupation thereof in the concept of owner, no matter how long, cannot
ripen into ownership and be registered as a title.21
Evidence extant on record showed that at the time of filing of the application
for land registration and issuance of the certificate of title over the disputed
land in the name of petitioners, the same was timberland and formed part of
the public domain, as per certification issued by the Bureau of Forest
Development on April 1, 1985, thus:
TO WHOM IT MAY CONCERN:
This is to certify that the tract of land situated in Vigo Cantidang, San Narciso,
Quezon, containing an area of 3,804.261 square meters as described in
Transfer Certificate of Title No. T-117618 x x x registered in the name of
Spouses Nestor E. Pagkatipunan and Rosalina Mañgas is verified to be within
the Timberland Block -B, Project No. 15-B of San Narciso, Quezon, certified
and declared as such on August 25, 1955 per BFD Map LC-1880. The land is,
therefore, within the administrative jurisdiction and control of the Bureau of
Forest Development, and not subject to disposition under the Public Land
Law.
[Sgd.]ARMANDO CRUZ
Supervising Cartographer22
This fact was even admitted by petitioners during the proceedings before the
court a quo on March 10, 1986, when they confirmed that the land has been
classified as forming part of forest land, albeit only on August 25,
1955.23 Since no imperfect title can be confirmed over lands not yet classified
as disposable or alienable, the title issued to herein petitioners is considered
void ab initio.24
Under the Regalian doctrine, all lands of the public domain belong to the
State, and the State is the source of any asserted right to ownership in land
and charged with the conservation of such patrimony. This same doctrine
also states that all lands not otherwise appearing to be clearly within private
ownership are presumed to belong to the State.25 To overcome such
presumption, incontrovertible evidence must be shown by the applicant that
the land subject of the application is alienable or disposable.26
In the case at bar, there was no evidence showing that the land has been
reclassified as disposable or alienable. Before any land may be declassified
from the forest group and converted into alienable or disposable land for
agricultural or other purposes, there must be a positive act from the
government. Even rules on the confirmation of imperfect titles do not apply
unless and until the land classified as forest land is released in an official
proclamation to that effect so that it may form part of the disposable
agricultural lands of the public domain.27 Declassification of forest land is an
express and positive act of Government.28 It cannot be presumed. Neither
should it be ignored nor deemed waived.29 It calls for proof.30
The court a quo found registrable title in favor of petitioners based on the
Republic’s failure to show that the land is more valuable as forest land than
for agricultural purposes, a finding which is based on a wrong concept of
what is forest land.
There is a big difference between "forest" as defined in the dictionary and
"forest or timber land" as a classification of land of the public domain in the
Constitution. One is descriptive of what appears on the land while the other
is a legal status, a classification for legal purposes. The "forest land" started
out as a "forest" or vast tracts of wooded land with dense growths of trees
and underbrush. However, the cutting down of trees and the disappearance
of virgin forest do not automatically convert the land of the public domain
from forest or timber land to alienable agricultural land.31
The classification of forest land, or any land for that matter, is descriptive of
its legal nature or status, and does not have to be descriptive of what the
land actually looks like.32 A person cannot enter into forest land and by the
simple act of cultivating a portion of that land, earn credits towards an
eventual confirmation of imperfect title. The Government must first declare
the forest land to be alienable and disposable agricultural land before the
year of entry, cultivation, and exclusive and adverse possession can be
counted for purposes of an imperfect title.33
As ruled in the case of Heirs of Jose Amunategui v. Director of Forestry:34
A forested area classified as forest land of the public domain does not lose
such classification simply because loggers or settlers may 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. Swampy areas covered by mangrove trees, nipa palms, and other
trees growing in brackish or sea water may also be classified as forest land.
The classification is descriptive of its legal nature or status and does not have
to be descriptive of what the land actually looks like. Unless and until the
land classified as "forest" is released in an official proclamation to that effect
so that it may form part of the disposable agricultural lands of the public
domain, the rules on confirmation of imperfect title do not apply.
Moreover, the original text of Section 48 (b), Chapter VIII of the Public Land
Act, which took effect on December 1, 1936, expressly provided that only
agricultural land of the public domain are subject to acquisitive prescription,
to wit:
Section 48. x x x
(a) x x x
(b) Those who by themselves or through their predecessors-in-interest have
been in open, continuous, exclusive, and notorious possession and
occupation of agricultural lands of the public domain, under a bona
fide claim of acquisition of ownership, except as against the Government,
since July twenty-six, eighteen hundred and ninety-four, except when
prevented by war or force majeure. These shall be conclusively presumed to
have performed all the conditions essential to a Government grant and shall
be entitled to a certificate of title under the provisions of this Chapter.
(Emphasis supplied)
Thus, it is clear that the applicant must prove not only his open, continuous,
exclusive and notorious possession and occupation of the land either since
time immemorial or for the period prescribed therein, but most importantly,
he must prove that the land is alienable public land.35 In the case at bar,
petitioners failed to do so.
Petitioners’ contention that the Republic is now barred from questioning the
validity of the certificate of title issued to them considering that it took the
government almost eighteen (18) years to assail the same is erroneous. It is a
basic precept that prescription does not run against the State.36 The lengthy
occupation of the disputed land by petitioners cannot be counted in their
favor, as it remained part of the patrimonial property of the State, which
property, as stated earlier, is inalienable and indisposable. 37
In light of the foregoing, the Court of Appeals did not err when it set aside
the June 15, 1967 decision of the court a quo and ordered that the subject
lot be reverted back to the public domain. Since the land in question is
unregistrable, the land registration court did not acquire jurisdiction over the
same. Any proceedings had or judgment rendered therein is void and is not
entitled to the respect accorded to a valid judgment.
Consequently, the Court of Appeals rightfully denied petitioners’ motion to
set aside the judgment rendered on December 12, 1986, in the land
registration case.1âwphi1.nêt
WHEREFORE, in view of the foregoing, the decision of the Court of Appeals
dated June 27, 1986 in AC-G.R. SP No. 07115, is hereby AFFIRMED in toto.

Without pronouncement as to costs.

SO ORDERED.
G. R. No. 107764             October 4, 2002
EDNA COLLADO, BERNARDINA TAWAS, JORETO C. TORRES,
JOSE AMO, SERGIO L. MONTEALEGRE, VICENTE C. TORRES,
JOSEPH L. NUÑEZ, GLORIA SERRANO, DANILO FABREGAS, FERNANDO T.
TORRES,
LUZ G. TUBUNGBANUA, CARIDAD T. TUTANA, JOSE C. TORRES, JR.,
IMELDA CAYLALUAD, ROSALIE TUTANA, NORMA ASTORIAS, MYRNA M.
LANCION,
NORBERTO CAMILOTE, CECILIA MACARANAS, PEDRO BRIONES,
REMEDIOS BANTIGUE, DANTE L. MONTEALEGRE, AIDA T. GADON,
ARMANDO T. TORRES and FIDELITO ECO, petitioners,
vs.
COURT OF APPEALS and REPUBLIC OF THE PHILIPPINES, thru the Director of
Lands, respondents,
BOCKASANJO ISF AWARDEES ASSOCIATION, INC.,
LITA MENDOZA, MORADO PREFIDIGNO, TERESITA CRUZ
and CALOMA MOISES, respondents/intervernors.
DECISION
CARPIO, J.:
The Case
This Petition1 seeks to set aside the Decision of the Court of Appeals, 2 dated
June 22, 1992, in CA-G.R. SP No. 25597, which declared null and void the
Decision3 dated January 30, 1991 of the Regional Trial Court of Antipolo,
Rizal, Branch 71, in LRC No. 269-A, LRC Rec. No. N-59179, confirming the
imperfect title of petitioners over a parcel of land.
The Facts
On April 25, 1985, petitioner Edna T. Collado filed with the land registration
court an application for registration of a parcel of land with an approximate
area of 1,200,766 square meters or 120.0766 hectares ("Lot" for brevity). The
Lot is situated in Barangay San Isidro (formerly known as Boso-boso),
Antipolo, Rizal, and covered by Survey Plan Psu-162620. Attached to the
application was the technical description of the Lot as Lot Psu-162620 signed
by Robert C. Pangyarihan, Officer-in-Charge of the Survey Division, Bureau of
Lands, which stated, "[t]his survey is inside IN-12 Mariquina Watershed." On
March 24, 1986, petitioner Edna T. Collado filed an Amended Application to
include additional co-applicants.4 Subsequently, more applicants joined
(collectively referred to as "petitioners" for brevity).5
The Republic of the Philippines, through the Solicitor General, and the
Municipality of Antipolo, through its Municipal Attorney and the Provincial
Fiscal of Rizal, filed oppositions to petitioners’ application. In due course, the
land registration court issued an order of general default against the whole
world with the exception of the oppositors.
Petitioners alleged that they have occupied the Lot since time immemorial.
Their possession has been open, public, notorious and in the concept of
owners. The Lot was surveyed in the name of Sesinando Leyva, one of their
predecessors-in-interest, as early as March 22, 1902. Petitioners declared the
Lot for taxation purposes and paid all the corresponding real estate taxes.
According to them, there are now twenty-five co-owners in pro-indiviso
shares of five hectares each. During the hearings, petitioners submitted
evidence to prove that there have been nine transfers of rights among them
and their predecessors-in-interest, as follows:
"1. SESINANDO LEYVA was the earliest known predecessor-in-interest of the
Applicants who was in actual, open, notorious and continuous possession of
the property in the concept of owner. He had the property surveyed in his
name on 22 March 1902 (Exhibit "W" and "W-1" testimonies of J. Torres on
16 December 1987 and Mariano Leyva on 29 December 1987).
2. DIOSDADO LEYVA, is the son of Sesinando Leyva, who inherited the
property. He had the property resurveyed in his name on May 21-28, 1928
(Exhibit "X" and "X-1"; testimony of Mariano Leyva, a son of Diosdado Leyva).
3. GREGORIO CAMANTIQUE bought the property from Diosdado Leyva
before the Japanese Occupation of the Philippines during World War II. He
owned and possessed the property until 1958. He declared the property for
tax purposes, the latest of which was under Tax Declaration No. 7182 issued
on 3 February 1957 (Exhibit "I" and testimony of Mariano Leyva, supra).
4. ANGELINA REYNOSO, bought the property from Gregorio Camantique by
virtue of a Deed of Sale on 3 February 1958 (Exhibit "H"). During the
ownership of the property by Angelina Reynoso, Mariano Leyva the grandson
of Sesinando Leyva, the previous owner, attended to the farm. (Testimony of
Mariano Leyva, supra). Angelina Reynoso declared the property in her name
under Tax Declaration No. 7189 in 4 February 1958, under Tax Declaration
No. 8775 on 3 August 1965, under Tax Declaration No. 16945 on 15
December 1975, and under Tax Declaration No. 03-06145 on 25 June 1978.
5. MYRNA TORRES bought the property from Angelina Reynoso on 16
October 1982 through a Deed of Sale (Exhibit "G").
6. EDNA COLLADO bought the property from Myrna Torres in a Deed of Sale
dated 28 April 1984 (Exhibit "P-1" to "P-3").
7. Additional owners BERNARDINA TAWAS, JORETO TORRES, JOSE AMO,
VICENTE TORRES and SERGIO MONTEALEGRE who bought portions of the
property from Edna Collado through a Deed of Sale on 6 November 1985
(Exhibit "Q" to "Q-3").
8. And more additional Owners JOSEPH NUNEZ, DIOSDADO ARENOS, DANILO
FABREGAS, FERNANDO TORRES, LUZ TUBUNGBANUA, CARIDAD TUTANA,
JOSE TORRES JR., RODRIGO TUTANA, ROSALIE TUTANA, NORMA ASTORIAS,
MYRNA LANCION, CHONA MARCIANO, CECILIA MACARANAS, PEDRO
BRIONES, REMEDIOS BANTIQUE, DANTE MONTEALEGRE, ARMANDO TORRES,
AIDA GADON and AMELIA M. MALAPAD bought portions of the property in a
Deed of Sale on 12 May 1986 (Exhibit "S" to "S-3").
9. Co-owners DIOSDADO ARENOS, RODRIGO TUTANA, CHONA MARCIANO
and AMELIA MALAPAD jointly sold their shares to new OWNERS GLORIA R.
SERRANO, IMELDA CAYLALUAD, NORBERTO CAMILOTE and FIDELITO ECO
through a Deed of Sale dated 18 January 1987 (Exhibit "T" to "T-9")."6
During the hearing on January 9, 1991, only the assistant provincial
prosecutor appeared without the Solicitor General. For failure of the
oppositors to present their evidence, the land registration court issued an
order considering the case submitted for decision based on the evidence of
the petitioners. The court later set aside the order and reset the hearing to
January 14, 1991 for the presentation of the evidence of the oppositors. On
this date, counsel for oppositors failed to appear again despite due notice.
Hence, the court again issued an order submitting the case for decision based
on the evidence of the petitioners.
The Trial Court’s Ruling
After appraisal of the evidence submitted by petitioners, the land registration
court held that petitioners had adduced sufficient evidence to establish their
registrable rights over the Lot. Accordingly, the court rendered a decision
confirming the imperfect title of petitioners. We quote the pertinent portions
of the court’s decision, as follows:
"From the evidence presented, the Court finds that from the testimony of
the witnesses presented by the Applicants, the property applied for is in
actual, open, public and notorious possession by the applicants and their
predecessor-in-interest since time immemorial and said possession had been
testified to by witnesses Jimmy Torres, Mariano Leyva, Sergio Montealegre,
Jose Amo and one Chona who were all cross-examined by Counsel for
Oppositor Republic of the Philippines.
Evidence was likewise presented that said property was declared for taxation
purposes in the names of the previous owners and the corresponding taxes
were paid by the Applicants and the previous owners and said property was
planted to fruit bearing trees; portions to palay and portions used for grazing
purposes.
To the mind of the Court, Applicants have presented sufficient evidence to
establish registrable title over said property applied for by them.
On the claim that the property applied for is within the Marikina Watershed,
the Court can only add that all Presidential Proclamations like the
Proclamation setting aside the Marikina Watershed are subject to "private
rights."
In the case of Municipality of Santiago vs. Court of Appeals, 120 SCRA 734,
1983 "private rights" is proof of acquisition through (sic) among means of
acquisition of public lands.
In the case of Director of Lands vs. Reyes, 68 SCRA 193-195, by "private
rights" means that applicant should show clear and convincing evidence that
the property in question was acquired by applicants or their ancestors either
by composition title from the Spanish government or by Possessory
Information title, or any other means for the acquisition of public lands xxx"
(underscoring supplied).
The Court believes that from the evidence presented as above stated,
Applicants have acquired private rights to which the Presidential
Proclamation setting aside the Marikina Watershed should be subject to such
private rights.
At any rate, the Court notes that evidence was presented by the applicants
that as per Certification issued by the Bureau of Forest Development dated
March 18, 1980, the area applied for was verified to be within the area
excluded from the operation of the Marikina Watershed Lands Executive
Order No. 33 dated July 26, 1904 per Proclamation No. 1283 promulgated on
June 21, 1974 which established the Boso-boso Town Site Reservation,
amended by Proclamation No. 1637 dated April 18, 1977 known as the
Lungsod Silangan Townsite Reservation. (Exhibit "K")."7
In a motion dated April 5, 1991, received by the Solicitor General on April 6,
1991, petitioners alleged that the decision dated January 30, 1991 confirming
their title had become final after the Solicitor General received a copy of the
decision on February 18, 1991. Petitioners prayed that the land registration
court order the Land Registration Authority to issue the necessary decree in
their favor over the Lot.
On April 11, 1991, the Solicitor General inquired from the Provincial
Prosecutor of Rizal whether the land registration court had already rendered
a decision and if so, whether the Provincial Prosecutor would recommend an
appeal. However, the Provincial Prosecutor failed to answer the query.
According to the Solicitor General, he received on April 23, 1991 a copy of
the land registration court’s decision dated January 30, 1991, and not on
February 18, 1991 as alleged by petitioners in their motion.
In the meantime, on May 7, 1991, the land registration court issued an order
directing the Land Regulation Authority to issue the corresponding decree of
registration in favor of the petitioners.
On August 6, 1991, the Solicitor General filed with the Court of Appeals a
Petition for Annulment of Judgment pursuant to Section 9(2) of BP Blg. 129
on the ground that there had been no clear showing that the Lot had been
previously classified as alienable and disposable making it subject to private
appropriation.
On November 29, 1991, Bockasanjo ISF Awardees Association, Inc., an
association of holders of certificates of stewardship issued by the
Department of Environment and Natural Resources ("DENR" for brevity)
under its Integrated Social Forestry Program ("ISF" for brevity), filed with the
Court of Appeals a Motion for Leave to Intervene and to Admit Petition-In-
Intervention. They likewise opposed the registration and asserted that the
Lot, which is situated inside the Marikina Watershed Reservation, is
inalienable. They claimed that they are the actual occupants of the Lot
pursuant to the certificates of stewardship issued by the DENR under the ISF
for tree planting purposes.
The Court of Appeals granted the motion to intervene verbally during the
preliminary conference held on April 6, 1992. During the preliminary
conference, all the parties as represented by their respective counsels agreed
that the only issue for resolution was whether the Lot in question is part of
the public domain.8
The Court of Appeals’ Ruling
In a decision dated June 22, 1992, the Court of Appeals granted the petition
and declared null and void the decision dated January 30, 1991 of the land
registration court. The Court of Appeals explained thus:
"Under the Regalian Doctrine, which is enshrined in the 1935 (Art. XIII, Sec.
1), 1973 (Art. XIV, Sec. 8), and 1987 Constitution (Art. XII, Sec. 2), all lands of
the public domain belong to the State. An applicant, like the private
respondents herein, for registration of a parcel of land bears the burden of
overcoming the presumption that the land sought to be registered forms
part of the public domain (Director of Lands vs. Aquino, 192 SCRA 296).
A positive Act of government is needed to declassify a public land and to
convert it into alienable or disposable land for agricultural or other purposes
(Republic vs. Bacas, 176 SCRA 376).
In the case at bar, the private respondents failed to present any evidence
whatsoever that the land applied for as described in Psu-162620 has been
segregated from the bulk of the public domain and declared by competent
authority to be alienable and disposable. Worse, the technical description of
Psu-162620 signed by Robert C. Pangyarihan, Officer-in-Charge, Survey
Division, Bureau of Lands, which was attached to the application of private
respondents, categorically stated that "This survey is inside IN-12 Mariquina
Watershed.""
That the land in question is within the Marikina Watershed Reservation is
confirmed by the Administrator of the National Land Titles and Deeds in a
Report, dated March 2, 1988, submitted to the respondent Court in LR Case
No. 269-A. These documents readily and effectively negate the allegation in
private respondent Collado’s application that "said parcel of land known as
Psu-162620 is not covered by any form of title, nor any public land
application and are not within any government reservation (Par. 8,
Application; Emphasis supplied). The respondent court could not have missed
the import of these vital documents which are binding upon the courts
inasmuch as it is the exclusive prerogative of the Executive Department to
classify public lands. They should have forewarned the respondent judge
from assuming jurisdiction over the case.
"x x x inasmuch as the said properties applied for by petitioners are part of
the public domain, it is the Director of Lands who has jurisdiction in the
disposition of the same (subject to the approval of the Secretary of Natural
Resources and Environment), and not the courts. x x x Even assuming that
petitioners did have the said properties surveyed even before the same was
declared to be part of the Busol Forest Reservation, the fact remains that it
was so converted into a forest reservation, thus it is with more reason that
this action must fail. Forest lands are inalienable and possession thereof, no
matter how long, cannot convert the same into private property. And courts
are without jurisdiction to adjudicate lands within the forest zone. (Heirs of
Gumangan vs. Court of Appeals. 172 SCRA 563; Emphasis supplied).
Needless to say, a final judgment may be annulled on the ground of lack of
jurisdiction, fraud or that it is contrary to law (Panlilio vs. Garcia, 119 SCRA
387, 391) and a decision rendered without jurisdiction is a total nullity and
may be struck down at any time (Suarez vs. Court of Appeals, 186 SCRA
339)."9
Hence, the instant petition.
The Issues
The issues raised by petitioners are restated as follows:
I
WHETHER THE COURT OF APPEALS ERRED OR GRAVELY ABUSED ITS
DISCRETION IN REVERSING THE DECISION OF THE TRIAL COURT GRANTING
THE APPLICATION OF THE PETITIONERS FOR CONFIRMATION OF TITLE;
II
WHETHER THE COURT OF APPEALS ERRED OR GRAVELY ABUSED ITS
DISCRETION IN GIVING DUE COURSE TO THE PETITION FOR ANNULMENT OF
JUDGMENT FILED BY THE REPUBLIC LONG AFTER THE DECISION OF THE TRIAL
COURT HAD BECOME FINAL;
III
WHETHER THE COURT OF APPEALS ERRED OR GRAVELY ABUSED ITS
DISCRETION IN GIVING DUE COURSE TO THE INTERVENORS’ PETITION FOR
INTERVENTION WHICH WAS FILED OUT OF TIME OR LONG AFTER THE
DECISION OF THE TRIAL COURT HAD BECOME FINAL.
The Court’s Ruling
The petition is bereft of merit.
First Issue: whether petitioners have registrable title over the Lot.
There is no dispute that Executive Order No. 33 ("EO 33" for brevity) dated
July 26, 190410 established the Marikina Watershed Reservation ("MWR" for
brevity) situated in the Municipality of Antipolo, Rizal. Petitioners even
concede that the Lot, described as Lot Psu-162620, is inside the technical,
literal description of the MWR. However, the main thrust of petitioners’
claim over the Lot is that "all Presidential proclamations like the
proclamation setting aside the Marikina Watershed Reservation are subject
to private rights." They point out that EO 33 contains a saving clause that the
reservations are "subject to existing private rights, if any there be."
Petitioners contend that their claim of ownership goes all the way back to
1902, when their known predecessor-in-interest, Sesinando Leyva, laid claim
and ownership over the Lot. They claim that the presumption of law then
prevailing under the Philippine Bill of 1902 and Public Land Act No. 926 was
that the land possessed and claimed by individuals as their own are
agricultural lands and therefore alienable and disposable. They conclude that
private rights were vested on Sesinando Leyva before the issuance of EO 33,
thus excluding the Lot from the Marikina Watershed Reservation.
Petitioners’ arguments find no basis in law.
The Regalian Doctrine: An Overview
Under the Regalian Doctrine, all lands not otherwise appearing to be clearly
within private ownership are presumed to belong to the State.11 The
Spaniards first introduced the doctrine to the Philippines through the Laws of
the Indies and the Royal Cedulas, specifically, Law 14, Title 12, Book 4 of the
Novisima Recopilacion de Leyes de las Indias12 which laid the foundation that
"all lands that were not acquired from the Government, either by purchase
or by grant, belong to the public domain."13 Upon the Spanish conquest of
the Philippines, ownership of all "lands, territories and possessions" in the
Philippines passed to the Spanish Crown.14
The Laws of the Indies were followed by the Ley Hipotecaria or the Mortgage
Law of 1893. The Spanish Mortgage Law provided for the systematic
registration of titles and deeds as well as possessory claims. The Royal
Decree of 1894 or the "Maura Law" partly amended the Mortgage Law as
well as the Law of the Indies. The Maura Law was the last Spanish land law
promulgated in the Philippines. It required the "adjustment" or registration
of all agricultural lands, otherwise the lands would revert to the state. 15
Four years later, Spain ceded to the government of the United States all
rights, interests and claims over the national territory of the Philippine
Islands through the Treaty of Paris of December 10, 1898. In 1903, the United
States colonial government, through the Philippine Commission, passed Act
No. 926, the first Public Land Act, which was described as follows:
"Act No. 926, the first Public Land Act, was passed in pursuance of the
provisions of the Philippine Bill of 1902. The law governed the disposition of
lands of the public domain. It prescribed rules and regulations for the
homesteading, selling and leasing of portions of the public domain of the
Philippine Islands, and prescribed the terms and conditions to enable persons
to perfect their titles to public lands in the Islands. It also provided for the
"issuance of patents to certain native settlers upon public lands," for the
establishment of town sites and sale of lots therein, for the completion of
imperfect titles, and for the cancellation or confirmation of Spanish
concessions and grants in the Islands." In short, the Public Land Act operated
on the assumption that title to public lands in the Philippine Islands remained
in the government; and that the government’s title to public land sprung
from the Treaty of Paris and other subsequent treaties between Spain and
the United States. The term "public land" referred to all lands of the public
domain whose title still remained in the government and are thrown open to
private appropriation and settlement, and excluded the patrimonial property
of the government and the friar lands."16
Thus, it is plain error for petitioners to argue that under the Philippine Bill of
1902 and Public Land Act No. 926, mere possession by private individuals of
lands creates the legal presumption that the lands are alienable and
disposable.
Act 2874, the second Public Land Act, superseded Act No. 926 in 1919. After
the passage of the 1935 Constitution, Commonwealth Act No. 141 ("CA 141"
for brevity) amended Act 2874 in 1936. CA 141, as amended, remains to this
day as the existing general law governing the classification and disposition of
lands of the public domain other than timber and mineral lands.17
In the meantime, in order to establish a system of registration by which
recorded title becomes absolute, indefeasible and imprescriptible, the
legislature passed Act 496, otherwise known as the Land Registration Act,
which took effect on February 1, 1903. Act 496 placed all registered lands in
the Philippines under the Torrens system.18 The Torrens system requires the
government to issue a certificate of title stating that the person named in the
title is the owner of the property described therein, subject to liens and
encumbrances annotated on the title or reserved by law. The certificate of
title is indefeasible and imprescriptible and all claims to the parcel of land are
quieted upon issuance of the certificate.19 PD 1529, known as the Property
Registration Decree enacted on June 11, 1978,20 amended and updated Act
496.
The 1935, 1973, 1987 Philippine Constitutions
The 1935, 1973 and 1987 Constitutions adopted the Regalian doctrine
substituting, however, the state, in lieu of the King, as the owner of all lands
and waters of the public domain.21 Justice Reynato S. Puno, in his separate
opinion in Cruz vs. Secretary of Environment and Natural
Resources,22 explained thus:
"One of the fixed and dominating objectives of the 1935 Constitutional
Convention was the nationalization and conservation of the natural
resources of the country. 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 to 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."
Thus, Section 1, Article XIII23 of the 1935 Constitution, on "Conservation and
Utilization of Natural Resources" barred the alienation of all natural
resources except public agricultural lands, which were the only natural
resources the State could alienate. The 1973 Constitution reiterated the
Regalian doctrine in Section 8, Article XIV24 on the "National Economy and
the Patrimony of the Nation". The 1987 Constitution reaffirmed the Regalian
doctrine in Section 2 of Article XII25 on "National Economy and Patrimony".
Both the 1935 and 1973 Constitutions prohibited the alienation of all natural
resources except agricultural lands of the public domain. The 1987
Constitution readopted this policy. Indeed, all lands of the public domain as
well as all natural resources enumerated in the Philippine Constitution
belong to the State.
Watershed Reservation is a Natural Resource
The term "natural resource" includes "not only timber, gas, oil coal, minerals,
lakes, and submerged lands, but also, features which supply a human need
and contribute to the health, welfare, and benefit of a community, and are
essential to the well-being thereof and proper enjoyment of property
devoted to park and recreational purposes."26
In Sta. Rosa Realty Development Corp. vs. Court of Appeals, et al., 27 the Court
had occasion to discourse on watershed areas. The Court resolved the issue
of whether the parcel of land which the Department of Environment and
Natural Resources had assessed to be a watershed area is exempt from the
coverage of RA No. 6657 or the Comprehensive Agrarian Reform Law ("CARL"
for brevity).28 The Court defined watershed as "an area drained by a river and
its tributaries and enclosed by a boundary or divide which separates it from
adjacent watersheds." However, the Court also recognized that:
"The definition does not exactly depict the complexities of a watershed. The
most important product of a watershed is water which is one of the most
important human necessit(ies). The protection of watershed ensures an
adequate supply of water for future generations and the control of
flashfloods that not only damage property but also cause loss of lives.
Protection of watersheds is an "intergenerational" responsibility that needs
to be answered now."
Article 67 of the Water Code of the Philippines (PD 1067) provides:
"Art. 67. Any watershed or any area of land adjacent to any surface water or
overlying any ground water may be declared by the Department of Natural
Resources as a protected area. Rules and Regulations may be promulgated
by such Department to prohibit or control such activities by the owners or
occupants thereof within the protected area which may damage or cause the
deterioration of the surface water or ground water or interfere with the
investigation, use, control, protection, management or administration of
such waters."
The Court in Sta. Rosa Realty also recognized the need to protect watershed
areas and took note of the report of the Ecosystems Research and
Development Bureau (ERDB), a research arm of the DENR, regarding the
environmental assessment of the Casile and Kabanga-an river watersheds
involved in that case. That report concluded as follows:
"The Casile barangay covered by CLOA in question is situated in the heartland
of both watersheds. Considering the barangays proximity to the Matangtubig
waterworks, the activities of the farmers which are in conflict with proper
soil and water conservation practices jeopardize and endanger the vital
waterworks. Degradation of the land would have double edge detrimental
effects. On the Casile side this would mean direct siltation of the Mangumit
river which drains to the water impounding reservoir below. On the Kabanga-
an side, this would mean destruction of forest covers which acts as recharged
areas of the Matangtubig springs. Considering that the people have little if no
direct interest in the protection of the Matangtubig structures they couldn’t
care less even if it would be destroyed.
The Casile and Kabanga-an watersheds can be considered a most vital life
support system to thousands of inhabitants directly and indirectly affected by
it. From these watersheds come the natural God-given precious resource –
water. x x x
Clearing and tilling of the lands are totally inconsistent with sound watershed
management. More so, the introduction of earth disturbing activities like
road building and erection of permanent infrastructures. Unless the
pernicious agricultural activities of the Casile farmers are immediately
stopped, it would not be long before these watersheds would cease to be of
value. The impact of watershed degradation threatens the livelihood of
thousands of people dependent upon it. Toward this, we hope that an
acceptable comprehensive watershed development policy and program be
immediately formulated and implemented before the irreversible damage
finally happens."
The Court remanded the case to the Department of Agriculture and
Adjudication Board or DARAB to re-evaluate and determine the nature of the
parcels of land involved in order to resolve the issue of its coverage by the
CARL.
Sta. Rosa Realty gives us a glimpse of the dangers posed by the misuse of
natural resources such as watershed reservations which are akin to forest
zones. Population growth and industrialization have taken a heavy toll on the
environment. Environmental degradation from unchecked human activities
could wreak havoc on the lives of present and future generations. Hence, by
constitutional fiat, natural resources remain to this day inalienable properties
of the State.
Viewed under this legal and factual backdrop, did petitioners acquire, as they
vigorously argue, private rights over the parcel of land prior to the issuance
of EO 33 segregating the same as a watershed reservation?
The answer is in the negative.
First. An applicant for confirmation of imperfect title bears the burden of
proving that he meets the requirements of Section 48 of CA 141, as
amended. He must overcome the presumption that the land he is applying
for is part of the public domain and that he has an interest therein sufficient
to warrant registration in his name arising from an imperfect title. An
imperfect title may have been derived from old Spanish grants such as a
titulo real or royal grant, a concession especial or special grant, a
composicion con el estado or adjustment title, or a titulo de compra or title
through purchase.29 Or, that he has had continuous, open and notorious
possession and occupation of agricultural lands of the public domain under a
bona fide claim of ownership for at least thirty years preceding the filing of
his application as provided by Section 48 (b) CA 141.
Originally, Section 48(b) of CA 141 provided for possession and occupation of
lands of the public domain since July 26, 1894. This was superseded by RA
1942 which provided for a simple thirty-year prescriptive period of
occupation by an applicant for judicial confirmation of an imperfect title. The
same, however, has already been amended by Presidential Decree No. 1073,
approved on January 25, 1977, the law prevailing at the time petitioners’
application for registration was filed on April 25, 1985.30 As amended, Section
48 (b) now reads:
"(b) Those who by themselves or through their predecessors-in-interest have
been in open, continuous, exclusive and notorious possession and
occupation of agricultural lands of the public domain, under a bona fide claim
of acquisition or ownership, for at least thirty years immediately preceding
the filing of the application for confirmation of title, except when prevented
by wars or force majeure. Those shall be conclusively presumed to have
performed all the conditions essential to a Government grant and shall be
entitled to a certificate of title under the provisions of this chapter."
Interpreting Section 48 (b) of CA 141, the Court stated that the Public Land
Act requires that the applicant must prove the following:
"(a) that the land is alienable public land and (b) that his open, continuous,
exclusive and notorious possession and occupation of the same must either
be since time immemorial or for the period prescribed in the Public Land Act.
When the conditions set by law are complied with, the possessor of the land,
by operation of law, acquires a right to a grant, a government grant, without
the necessity of a certificate of title being issued." 31
Petitioners do not claim to have documentary title over the Lot. Their right to
register the Lot is predicated mainly upon continuous possession since 1902.
Clearly, petitioners were unable to acquire a valid and enforceable right or
title because of the failure to complete the required period of possession,
whether under the original Section 48 (b) of CA 141 prior to the issuance of
EO 33, or under the amendment by RA 1942 and PD 1073.
There is no proof that prior to the issuance of EO 33 in 1904, petitioners had
acquired ownership or title to the Lot either by deed or by any other mode of
acquisition from the State, as for instance by acquisitive prescription. As of
1904, Sesinando Leyva had only been in possession for two years. Verily,
petitioners have not possessed the parcel of land in the manner and for the
number of years required by law for the confirmation of imperfect title.
Second, assuming that the Lot was alienable and disposable land prior to the
issuance of EO 33 in 1904, EO 33 reserved the Lot as a watershed. Since then,
the Lot became non-disposable and inalienable public land. At the time
petitioners filed their application on April 25, 1985, the Lot has been
reserved as a watershed under EO 33 for 81 years prior to the filing of
petitioners’ application.
The period of occupancy after the issuance of EO 33 in 1904 could no longer
be counted because as a watershed reservation, the Lot was no longer
susceptible of occupancy, disposition, conveyance or alienation. Section 48
(b) of CA 141, as amended, applies exclusively to alienable and disposable
public agricultural land. Forest lands, including watershed reservations, are
excluded. It is axiomatic that the possession of forest lands or other
inalienable public lands cannot ripen into private ownership. In Municipality
of Santiago, Isabela vs. Court of Appeals,32 the Court declared that inalienable
public lands -
"x x x cannot be acquired by acquisitive prescription. Prescription, both
acquisitive and extinctive, does not run against the State.
‘The possession of public land, however long the period may have extended,
never confers title thereto upon the possessor because the statute of
limitations with regard to public land does not operate against the State,
unless the occupant can prove possession and occupation of the same under
claim of ownership for the required number of years to constitute a grant
from the State.’ "
Third, Gordula vs. Court of Appeals33 is in point. In Gordula, petitioners did
not contest the nature of the land. They admitted that the land lies in the
heart of the Caliraya-Lumot River Forest Reserve, which Proclamation No.
573 classified as inalienable. The petitioners in Gordula contended, however,
that Proclamation No. 573 itself recognizes private rights of landowners prior
to the reservation. They claim to have established their private rights to the
subject land. The Court ruled:
"We do not agree. No public land can be acquired by private persons without
any grant, express or implied from the government; it is indispensable that
there be a showing of a title from the state. The facts show that petitioner
Gordula did not acquire title to the subject land prior to its reservation under
Proclamation No. 573. He filed his application for free patent only in January,
1973, more than three (3) years after the issuance of Proclamation No. 573 in
June, 1969. At that time, the land, as part of the Caliraya-Lumot River Forest
Reserve, was no longer open to private ownership as it has been classified as
public forest reserve for the public good.
Nonetheless, petitioners insist that the term, "private rights," in
Proclamation No. 573, should not be interpreted as requiring a title. They
opine that it suffices if the claimant "had occupied and cultivated the
property for so many number of years, declared the land for taxation
purposes, [paid] the corresponding real estate taxes [which are] accepted by
the government, and [his] occupancy and possession [is] continuous, open
and unmolested and recognized by the government. Prescinding from this
premise, petitioners urge that the 25-year possession by petitioner Gordula
from 1944 to 1969, albeit five (5) years short of the 30-year possession
required under Commonwealth Act (C.A.) No. 141, as amended, is enough to
vest upon petitioner Gordula the "private rights" recognized and respected in
Proclamation No. 573.
The case law does not support this submission. In Director of Lands vs. Reyes,
we held that a settler claiming the protection of "private rights" to exclude
his land from a military or forest reservation must show "x x x by clear and
convincing evidence that the property in question was acquired by [any] x x x
means for the acquisition of public lands."
In fine, one claiming "private rights" must prove that he has complied with
C.A. No. 141, as amended, otherwise known as the Public Land Act, which
prescribes the substantive as well as the procedural requirements for
acquisition of public lands. This law requires at least thirty (30) years of open,
continuous, exclusive and notorious possession and possession of agricultural
lands of the public domain, under a bona fide claim of acquisition,
immediately preceding the filing of the application for free patent. The
rationale for the 30-year period lies in the presumption that the land applied
for pertains to the State, and that the occupants and/or possessors claim an
interest therein only by virtue of their imperfect title or continuous, open
and notorious possession."
Next, petitioners argue that assuming no private rights had attached to the
Lot prior to EO 33 in 1904, the President of the Philippines had subsequently
segregated the Lot from the public domain and made the Lot alienable and
disposable when he issued Proclamation No. 1283 on June 21, 1974.
Petitioners contend that Proclamation No. 1283 expressly excluded an area
of 3,780 hectares from the MWR and made the area part of the Boso-boso
Townsite Reservation. Petitioners assert that Lot Psu-162620 is a small part
of this excluded town site area. Petitioners further contend that town sites
are considered alienable and disposable under CA 141.
Proclamation No. 1283 reads thus:
"PROCLAMATION NO. 1283
EXCLUDING FROM THE OPERATION EXECUTIVE ORDER NO. 33, DATED JULY
26, 1904, AS AMENDED BY EXECUTIVE ORDERS NOS. 14 AND 16, BOTH
SERIES OF 1915, WHICH ESTABLISHED THE WATERSHED RESERVATION
SITUATED IN THE MUNICIPALITY OF ANTIPOLO, PROVINCE OF RIZAL, ISLAND
OF LUZON, A CERTAIN PORTION OF THE LAND EMBRACED THEREIN AND
RESERVING THE SAME, TOGETHER WITH THE ADJACENT PARCEL OF LAND OF
THE PUBLIC DOMAIN, FOR TOWNSITE PURPOSES UNDER THE PROVISIONS OF
CHAPTER XI OF THE PUBLIC LAND ACT.
Upon recommendation of the Secretary of Agriculture and Natural Resources
and pursuant to the authority vested in me by law, I, FERDINAND E. MARCOS,
President of the Philippines, do hereby, exclude from the operation of
Executive Order No. 33 dated July 26, 1904, as amended by Executive Orders
Nos. 14 and 16, both series of 1915, which established the Watershed
Reservation situated in the Municipality of Antipolo, Province of Rizal, Island
of Luzon, certain portions of land embraced therein and reserve the same,
together with the adjacent parcel of land of the public domain, for townsite
purposes under the provisions of Chapter XI of the Public Land Act, subject to
private rights, if any there be, and to future subdivision survey in accordance
with the development plan to be prepared and approved by the Department
of Local Government and Community Development, which parcels are more
particularly described as follows:
Lot A (Part of Watershed Reservation)
A parcel of land (Lot A of Proposed Poor Man’s Baguio, being a portion of the
Marikina Watershed, IN-2), situated in the municipality of Antipolo, Province
of Rizal, Island of Luzon, beginning at a point marked "1" on sketch plan,
being N-74’-30 E, 8480.00 meters more or less, from BLLM 1, Antipolo, Rizal;
thence N 33’ 28 W 1575.00 m. to point 2; thence N 40’ 26 W 1538.50 m. to
point 3; thence N 30’ 50W 503.17 m. to point 4; thence N 75’ 02 W 704.33 m.
to point 5; thence N 14’ 18 W 1399.39 m. to point 6; thence N 43’ 25 W
477.04 m. to point 7; thence N 71’ 38 W 458.36 m. to point 8; thence N 31’
05 W 1025.00 m. to point 9; thence Due North 490.38 m. to point 10; thence
Due North 1075.00 m. to point 11; thence Due East 1000.00 m. to point 12;
thence Due East 1000.00 m. to point 13; thence Due East 1000.00 m. to point
14; thence Due East 1000.00 m. to point 15; thence Due East 1000.00 m. to
point 16; thence Due East 1000.00 m. to point 17; thence Due East 1075.00
m. to point 18; thence Due South 1000.00 m. to point 19; thence Due South
1000.00 m. to point 20; thence Due South 1000.00 m. to point 21; thence
Due South 1000.00 m. to point 22; thence Due South 1000.00 m. to point 23;
thence Due South 1000.00 m. to point 24; thence Due South 1075.00 m. to
point 25; thence Due West 1000.00 m. to point 26; thence Due West 1000.00
m. to point 27; thence Due West 636.56 m. to point of beginning. Containing
an area of three thousand seven hundred eighty (3,780) Hectares, more or
less.
Lot B (Alienable and Disposable Land)
A parcel of land (Lot B of Proposed Poor Man’s Baguio, being a portion of
alienable and disposable portion of public domain) situated in the
municipality of Antipolo, Province of Rizal, Island of Luzon. Beginning at a
point marked "1" on sketch plan being N 74’ 30 E., 8430.00 m., more or less,
from BLLM 1. Antipolo, Rizal; thence Due West 363.44 m. to point 2; thence
Due West 1000.00 m. to point 3; thence Due West 100.00 m. to point 4;
thence Due West 1000.00 m. to point 5; thence Due West 1075.00 m. to
point 6; thence Due North 1000.00 m. to point 7; thence Due North 1000.00
m. to point 8; thence Due North 1000.00 m. to point 9; thence Due North
1000.00 m. to point 10; thence Due North 1000.00 m. to point 11; thence
Due North 509.62 m. to point 12; thence S. 31’ 05 E 1025.00 m. to point 13;
thence S 71’ 38 E 458.36 m. to point 14; thence S 43’ 25 E 477.04 m. to point
15; thence S 14’ 18 E 1399.39 m. to point 16; thence S 75’ 02 E 704.33 m. to
point 17; thence S. 30’ 50 E 503.17 m. to point 18; thence S 40’ 26 E 1538.50
m. to point 19; thence s 33’ 23 e 1575.00 m to point of beginning. Containing
an area of one thousand two hundred twenty five (1,225) Hectares, more or
less.
Note: All data are approximate and subject to change based on future
survey.
IN WITNESS WHEREOF, I Have hereunto set my hand and caused the seal of
the Republic of the Philippines to be affixed.
Done in the City of Manila, this 21st day of June, in the year of Our Lord,
nineteen hundred and seventy-four.
(Sgd.) FERDINAND E. MARCOS
President
Republic of the Philippines"
Proclamation No. 1283 has since been amended by Proclamation No. 1637
issued on April 18, 1977. Proclamation No. 1637 revised the area and
location of the proposed townsite. According to then DENR Secretary Victor
O. Ramos, Proclamation No. 1637 excluded Lot A (of which the Lot claimed
by petitioners is part) for townsite purposes and reverted it to MWR
coverage.34 Proclamation No. 1637 reads:
"PROCLAMATION NO. 1637
AMENDING PROCLAMATION NO. 1283, DATED JUNE 21, 1974, WHICH
ESTABLISHED THE TOWNSITE RESERVATION IN THE MUNICIPALITIES OF
ANTIPOLO AND SAN MATEO, PROVINCE OF RIZAL, ISLAND OF LUZON BY
INCREASING THE AREA AND REVISING THE TECHNICAL DESCRIPTION OF THE
LAND EMBRACED THEREIN, AND REVOKING PROCLAMATION NO. 765 DATED
OCTOBER 26, 1970 THAT RESERVED PORTIONS OF THE AREA AS
RESETTLEMENT SITE.
Upon recommendation of the Secretary of Natural Resources and pursuant
to the authority vested in me by law, I, FERDINAND E. MARCOS, President of
the Philippines, do hereby amend Proclamation No. 1283, dated June 21,
1974 which established the townsite reservation in the municipalities of
Antipolo and San Mateo, Province of Rizal, Island of Luzon, by increasing the
area and revising the technical descriptions of the land embraced therein,
subject to private rights, if any there be, which parcel of land is more
particularly described as follows:
(Proposed Lungsod Silangan Townsite)
A PARCEL OF LAND (Proposed Lungsod Silangan Townsite Reservation
amending the area under SWO-41762 establishing the Bagong Silangan
Townsite Reservation) situated in the Municipalities of Antipolo, San Mateo,
and Montalban, Province of Rizal, Island of Luzon. Bounded on the E., along
lines 1-2-3-4-5-6-7-8-9-10-11-12-13-14-15-16-17-18-19-20-21-22-23 by the
Marikina Watershed Reservation (IN-12); on the S., along lines 23-24-25 by
the portion of Antipolo; on the W., along lines 25-26-27-28-29-30 by the
Municipalities of Montalban, San Mateo; and on the N., along lines 30-31-32-
33-34-35-36-37-38-39-40-41-42-43-44 by the Angat Watershed Reservation.
Beginning at a point marked "1" on the Topographic Maps with the Scale of
1:50,000 which is the identical corner 38 IN-12, Marikina Watershed
Reservation.
xxx     xxx     xxx
NOTE: All data are approximate and subject to change based on future
survey.
Proclamation No. 765 dated October 26, 1970, which covered areas entirely
within the herein Lungsod Silangan Townsite, is hereby revoked accordingly.
IN WITNESS WHEREOF, I have hereunto set my hand and caused the seal of
the Republic of the Philippines to be affixed.
Done in the City of Manila, this 18th day of April, in the year of Our Lord,
nineteen hundred and seventy-seven.
(Sgd.) FERDINAND E. MARCOS
President of the Philippines"
A positive act (e.g., an official proclamation) of the Executive Department is
needed to declassify land which had been earlier classified as a watershed
reservation and to convert it into alienable or disposable land for agricultural
or other purposes.35 Unless and until the land classified as such is released in
an official proclamation so that it may form part of the disposable
agricultural lands of the public domain, the rules on confirmation of
imperfect title do not apply.36
The principal document presented by petitioners to prove the private
character of the Lot is the Certification of the Bureau of Forest Development
dated March 18, 1986 that the Lot is excluded from the Marikina Watershed
(Exh. R). The Certification reads:
"Republic of the Philippines
Ministry of Natural Resources
BUREAU OF FOREST DEVELOPMENT
REGION IV
EL – AL Building
100 Quezon Avenue, Quezon City
MAR 18 1986
VERIFICATION ON THE STATUS OF LAND:
TO WHOM IT MAY CONCERN:
This is to certify that the tract of land situated in Barangay San Isidro,
Antipolo, Rizal, containing an area of 1,269,766 square meters, as shown and
described on the reverse side hereof, surveyed by Geodetic Engineer
Telesforo Cabading for Angelina C. Reynoso, is verified to be within the area
excluded from the operation of Marikina Watershed Reservation established
under Executive Order No. 33 dated July 26, 1904 per Proclamation No.
1283, promulgated on June 21, 1974, which established the Boso-Boso
Townsite Reservation, amended by proclamation No. 1637 dated April 18,
1977 known as Lungsod Silangan Townsite Reservation.
Subject area also falls within the bounds of Bagong Lipunan Site under P.D.
1396 dated June 2, 1978 under the sole jurisdiction of the Ministry of Human
Settlements, to the exclusion of any other government agencies.
This verification is made upon the request of the Chief, Legal Staff, R-4 as
contained in his internal memorandum dated March 18, 1986.
Verified by:
(Sgd) ROMEO C. PASCUBILLO
Cartographer II
Checked by:
(Sgd) ARMENDO R. CRUZ
Supervising Cartographer
ATTESTED:
(Sgd) LUIS G. DACANAY
Chief, Forest Engineering & Infrastructure Section"
The above certification on which petitioners rely that a reclassification had
occurred, and that the Lot is covered by the reclassification, is contradicted
by several documents submitted by the Solicitor General before the land
registration court.
The Solicitor General submitted to the land registration court a
Report37 dated March 2, 1988, signed by Administrator Teodoro G. Bonifacio
of the then National Land Titles and Deeds Registration Administration,
confirming that the Lot described in Psu-162620 forms part of the MWR. He
thus recommended the dismissal of the application for registration. The
Report states:
"COMES NOW the Administrator of the National Land Titles and Deeds
Registration Commission and to this Honorable Court respectfully reports
that:
1. A parcel of land described in plan Psu-162620 situated in the Barrio of San
Isidro, Municipality of Antipolo, Province of Rizal, is applied for registration of
title in the case at bar.
2. After plotting plan Psu-162620 in our Municipal Index Map it was found
that a portion of the SW, described as Lot 3 in plan Psu-173790 was
previously the subject of registration in Land Reg. Case No. N-9578, LRC
Record No. N-55948 and was issued Decree No. N-191242 on April 4, 1986 in
the name of Apolonia Garcia, et al., pursuant to the Decision and Order for
Issuance of the Decree dated February 8, 1984 and March 6, 1984,
respectively, and the remaining portion of plan Psu-162620 is inside IN-12,
Marikina Watershed. x x x
"WHEREFORE, this matter is respectfully submitted to the Honorable Court
for its information and guidance with the recommendation that the
application in the instant proceedings be dismissed, after due hearing
(Underlining supplied)."
Likewise, in a letter38 dated November 11, 1991, the Deputy Land Inspector,
DENR, Region IV, Community Environment and Natural Resources Office,
Antipolo, Rizal, similarly confirmed that the Lot is within the MWR. The letter
states:
"That the land sought to be registered is situated at San Isidro (Boso-boso),
Antipolo, Rizal, with an area of ONE HUNDRED TWENTY SIX POINT ZERO
SEVEN SIXTY SIX (126.0766) hectares, more particularly described in Psu-
162620, which is within the Marikina Watershed Reservation under Executive
Order No. 33 dated July 2, 1904 which established the Marikina Watershed
Reservation (IN-12) x x x.
"x           x           x
"That the land sought to be registered is not a private property of the
Registration Applicant but part of the public domain, not subjected to
disposition and is covered by Proclamation No. 585 for Integrated Social
Forestry Program hence, L.R.C. No. 269-A is recommended for rejection
(Underlining supplied)." Copy of the letter is attached herewith as Annex "3"
and made an integral part hereof."
Lastly, the Solicitor General pointed out that attached to petitioner Edna T.
Collado’s [as original applicant] application is the technical description39 of
the Lot signed by Robert C. Pangyarihan, Officer-in-Charge of the Survey
Division of the Bureau of Lands. This technical description categorically
stated that the Lot "is inside IN-12 Mariquina Watershed."
The evidence of record thus appears unsatisfactory and insufficient to show
clearly and positively that the Lot had been officially released from the
Marikina Watershed Reservation to form part of the alienable and disposable
lands of the public domain. We hold that once a parcel of land is included
within a watershed reservation duly established by Executive Proclamation,
as in the instant case, a presumption arises that the land continues to be part
of such Reservation until clear and convincing evidence of subsequent
declassification is shown.
It is obvious, based on the facts on record that neither petitioners nor their
predecessors-in-interest have been in open, continuous, exclusive and
notorious possession and occupation of the Lot for at least thirty years
immediately preceding the filing of the application for confirmation of title.
Even if they submitted sufficient proof that the Lot had been excluded from
the MWR upon the issuance of Proclamation No. 1283 on June 21, 1974,
petitioners’ possession as of the filing of their application on April 25, 1985
would have been only eleven years counted from the issuance of the
proclamation in 1974. The result will not change even if we tack in the two
years Sesinando Leyva allegedly possessed the Lot from 1902 until the
issuance of EO 33 in 1904. Petitioners’ case falters even more because of the
issuance of Proclamation No. 1637 on April 18, 1977. According to then DENR
Secretary Victor Ramos, Proclamation No. 1637 reverted Lot A or the
townsite reservation, where petitioners' Lot is supposedly situated, back to
the MWR.
Finally, it is of no moment if the areas of the MWR are now fairly populated
and vibrant communities as claimed by petitioners. The following ruling may
be applied to this case by analogy:
"A forested area classified as forest land of the public domain does not lose
such classification simply because loggers or settlers may 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. Swampy areas covered by mangrove trees, nipa palms and other
trees growing in brackish or sea water may also be classified as forest land.
The classification is descriptive of its legal nature or status and does not have
to be descriptive of what the land actually looks like. Unless and until the
land classified as "forest" is released in an official proclamation to that effect
so that it may form part of the disposable agricultural lands of the public
domain, the rules on confirmation of imperfect title do not apply." 40
Second Issue: Whether the petition for annulment of judgment
should have been given due course.
Petitioners fault the Court of Appeals for giving due course to the Republic’s
petition for annulment of judgment which was filed long after the decision of
the land registration court had allegedly become final and executory. The
land registration court rendered its decision on January 30, 1991 and the
Solicitor General received a copy of the decision on April 23,
1991.41 Petitioners point out that the Solicitor General filed with the Court of
Appeals the petition for annulment of judgment invoking Section 9(2) of BP
Blg. 12942 only on August 6, 1991, after the decision had supposedly become
final and executory. Moreover, petitioners further point out that the Solicitor
General filed the petition for annulment after the land registration court
issued its order of May 6, 1991 directing the Land Registration Authority to
issue the corresponding decree of registration.
The Solicitor General sought the annulment of the decision on the ground
that the land registration court had no jurisdiction over the case, specifically,
over the Lot which was not alienable and disposable. The Solicitor General
maintained that the decision was null and void.
Petitioners argue that the remedy of annulment of judgment is no longer
available because it is barred by the principle of res judicata. They insist that
the land registration court had jurisdiction over the case which involves
private land. They also argue that the Republic is estopped from questioning
the land registration court’s jurisdiction considering that the Republic
participated in the proceedings before the court.
It is now established that the Lot, being a watershed reservation, is not
alienable and disposable public land. The evidence of the petitioners do not
clearly and convincingly show that the Lot, described as Lot Psu-162620,
ceased to be a portion of the area classified as a watershed reservation of
the public domain. Any title to the Lot is void ab initio. In view of this, the
alleged procedural infirmities attending the filing of the petition for
annulment of judgment are immaterial since the land registration court
never acquired jurisdiction over the Lot. All proceedings of the land
registration court involving the Lot are therefore null and void.
We apply our ruling in Martinez vs. Court of Appeals,43 as follows:
"The Land Registration Court has no jurisdiction over non-registrable
properties, such as public navigable rivers which are parts of the public
domain, and cannot validly adjudge the registration of title in favor of private
applicant. Hence, the judgment of the Court of First Instance of Pampanga as
regards the Lot No. 2 of certificate of Title No. 15856 in the name of
petitioners may be attacked at any time, either directly or collaterally, by the
State which is not bound by any prescriptive period provided for by the
Statute of Limitations."
We also hold that environmental consequences in this case override
concerns over technicalities and rules of procedure.
In Republic vs. De los Angeles,44 which involved the registration of public
lands, specifically parts of the sea, the Court rejected the principle of res
judicata and estoppel to silence the Republic’s claim over public lands. The
Court said:
"It should be noted further that the doctrine of estoppel or laches does not
apply when the Government sues as a sovereign or asserts governmental
rights, nor does estoppel or laches validate an act that contravenes law or
public policy, and that res judicata is to be disregarded if its application
would involve the sacrifice of justice to technicality."
The Court further held that "the right of reversion or reconveyance to the
State of the public properties registered and which are not capable of private
appropriation or private acquisition does not prescribe."
Third issue: Whether the petition-in-intervention is proper.
The Bockasanjo ISF Awardees Association, Inc., an association of holders of
certificates of stewardship issued by the DENR under its Integrated Social
Forestry Program, filed with the Court of Appeals on November 29, 1991 a
Motion for Leave to Intervene and to Admit Petition-In-Intervention.
According to intervenors, they are the actual occupants of the Lot which
petitioners sought to register. Aware that the parcels of land which their
forefathers had occupied, developed and tilled belong to the Government,
they filed a petition with then President Corazon C. Aquino and then DENR
Secretary Fulgencio S. Factoran, to award the parcels of land to them.
Secretary Factoran directed the Director of Forest Management Bureau to
take steps for the segregation of the aforementioned area from the MWR for
development under the DENR’s ISF Programs. Subsequently, then President
Aquino issued Proclamation No. 585 dated June 5, 1990 excluding 1,430
hectares from the operation of EO 33 and placed the same under the DENR’s
Integrated Social Forestry Program. Proclamation No. 585 reads:
PROCLAMATION NO. 585
AMENDING FURTHER EXECUTIVE ORDER NO. 33, DATED JULY 26, 1904
WHICH ESTABLISHED THE MARIKINA WATERSHED RESERVATION (IN-12) AS
AMENDED, BY EXCLUDING CERTAIN PORTIONS OF LANDS EMBRACED
THEREIN SITUATED AT SITIOS BOSOBOSO, KILINGAN, VETERANS, BARANGAYS
SAN JOSEPH AND PAENAAN, MUNICIPALITY OF ANTIPOLO, PROVINCE OF
RIZAL, ISLAND OF LUZON.
Upon recommendation of the Secretary of Environment and Natural
Resources and pursuant to the authority vested in me by law, I, CORAZON C.
AQUINO, President of the Philippines, do hereby exclude from the operation
of Executive Order No. 33, which established the Marikina Watershed
Reservation, certain parcel of land of the public domain embraced therein
situated in Sitios Bosoboso, Veterans, Kilingan and Barangay San Joseph and
Paenaan, Municipality of Antipolo, Province of Rizal and place the same
under the Integrated Social Forestry Program of the Department of
Environment and Natural Resources in accordance with existing laws, rules
and regulations, which parcel of land is more particularly described as
follows:
"A PARCEL OF LAND, within the Marikina Watershed Reservation situated in
the Municipality of Antipolo, Province of Rizal, beginning at point "1" on plan,
being identical to corner 1 of Marikina Watershed Reservation; thence
xxx     xxx     xxx
Containing an area of One Thousand Four Hundred Thirty (1,430) Hectares.
All other lands covered and embraced under Executive Order No. 33 as
amended, not otherwise affected by this Proclamation, shall remain in force
and effect.
IN WITNESS WHEREOF, I have hereunto set my hand and caused the seal of
the Republic of the Philippines to be affixed.
Done in the City of Manila, this 5th day of June, in the year of Our Lord,
nineteen hundred and ninety.
(Sgd.) CORAZON C. AQUINO
President of the Philippines"
Pursuant to Proclamation No. 585, the chief of the ISF Unit, acting through
the Regional Executive Director of the DENR (Region IV), issued sometime
between the years 1989 to 1991 certificates of stewardship contracts to
bona fide residents of the barangays mentioned in the proclamation as
qualified recipients of the ISF programs. Among those awarded were
intervenors. The certificates of stewardship are actually contracts of lease
granted by the DENR to actual occupants of parcels of land under its ISF
programs for a period of twenty-five (25) years, renewable for another
twenty-five (25) years.45 The DENR awarded contracts of stewardship to ISF
participants in Barangay San Isidro (or Boso-boso) and the other barangays
based on the Inventory of Forest Occupants the DENR had conducted.46
According to intervenors, they learned only on July 31, 1991 about the
pendency of LRC Case No. 269-A before the Regional Trial Court of Antipolo,
Rizal. On August 8, 1991, they filed a Motion for Leave to Intervene and to
Admit Opposition in Intervention before the land registration court to assert
their rights and to protect their interests.
However, shortly after the filing of their opposition, intervenors learned that
the land registration court had already rendered a decision on January 30,
1991 confirming petitioners’ imperfect title. Intervenors’ counsel received a
copy of the decision on August 9, 1991.
On August 14, 1991, intervenors filed a motion to vacate judgment and for
new trial before the land registration court. According to intervenors, the
land registration court could not act on its motions due to the restraining
order issued by the Court of Appeals on August 8, 1991, enjoining the land
registration court from executing its decision, as prayed for by the Solicitor
General in its petition for annulment of judgment. The intervenors were thus
constrained to file a petition for intervention before the Court of Appeals
which allowed the same.
Rule 19 of the 1997 Rules of Civil Procedure47 provides in pertinent parts:
Section 1. Who may intervene. – A person who has a legal interest in the
matter in litigation, or in the success of either of the parties, or an interest
against both, or is so situated as to be adversely affected by a distribution or
other disposition of property in the custody of the court, or an officer thereof
may, with leave of court, be allowed to intervene in the action. The Court
shall consider whether or not the intervention will unduly delay or prejudice
the adjudication of the rights of the original parties, and whether or not the
inertvenor’s rights may be fully protected in a separate proceeding.

Sec. 2. Time to intervene. – The motion to intervene may be filed at any time
before rendition of judgment by the trial court. A copy of the pleading-in-
intervention shall be attached to the motion and served on the original
parties.

As a rule, intervention is allowed "before rendition of judgment by the trial

court," as Section 2, Rule 19 expressly provides. However, the Court has
recognized exceptions to this rule in the interest of substantial justice. Mago
vs. Court of Appeals48 reiterated the ruling in Director of Lands vs. Court of
Appeals, where the Court allowed the motions for intervention even when
the case had already reached this Court. Thus, in Mago the Court held that:

"It is quite clear and patent that the motions for intervention filed by the
movants at this stage of the proceedings where trial had already been
concluded x x x and on appeal x x x the same affirmed by the Court of
Appeals and the instant petition for certiorari to review said judgment is
already submitted for decision by the Supreme Court, are obviously and,
manifestly late, beyond the period prescribed under x x x Section 2, Rule 12
of the rules of Court.

But Rule 12 of the Rules of Court, like all other Rules therein promulgated, is
simply a rule of procedure, the whole purpose and object of which is to make
the powers of the Court fully and completely available for justice. The
purpose of procedure is not to thwart justice. Its proper aim is to facilitate
the application of justice to the rival claims of contending parties. It was
created not to hinder and delay but to facilitate and promote the
administration of justice. It does not constitute the thing itself which courts
are always striving to secure to litigants. It is designed as the means best
adopted to obtain that thing. In other words, it is a means to an end."

To be sure, the Court of Appeals did not pass upon the actual status of
intervenors in relation to the Lot as this was not in issue. Neither was the
validity of the certificates of stewardship contracts which intervenors
allegedly possessed inquired into considering this too was not in issue. In
fact, intervenors did not specifically seek any relief apart from a declaration
that the Lot in question remains inalienable land of the public domain. We
cannot fault the Court of Appeals for allowing the intervention, if only to
provide the rival groups a peaceful venue for ventilating their sides. This case
has already claimed at least five lives due to the raging dispute between the
rival camps of the petitioners on one side and those of the DENR awardees
on the other. It also spawned a number of criminal cases between the two
rival groups including malicious mischief, robbery and arson. A strict
application of the rules would blur this bigger, far more important picture.

WHEREFORE, the Petition is DENIED. The Decision of the Court of Appeals

dated June 22, 1992 declaring null and void the Decision dated January 30,
1991 of Branch 71, Regional Trial Court of Antipolo, Rizal, in LRC No. 269-A,
LRC Rec. No. N-59179 is AFFIRMED.

SO ORDERED.
G.R. No. 156951             September 22, 2006
REPUBLIC OF THE PHILIPPINES, petitioner,
vs.
SOUTHSIDE HOMEOWNERS ASSOCIATION, INC. and the REGISTER OF DEEDS
OF PASIG, RIZAL, respondents.
x-------------------------------------------x
BASES CONVERSION DEVELOPMENT AUTHORITY, intervenor
x-------------------------------------------x
DEPARTMENT OF NATIONAL DEFENSE, represented by HON. SECRETARY
ANGELO T. REYES, and the ARMED FORCES OF THE PHILIPPINES,
represented by CHIEF OF STAFF, AFP, GENERAL NARCISO L.
ABAYA, intervenors
x-------------------------------------------x
G.R. No. 173408             September 22, 2006
RENE A.V. SAGUISAG, MGEN. MARCIANO ILAGAN (Ret.), MGEN. PONCIANO
MILLENA (Ret.), BGEN. JUANITO MALTO (Ret.), BGEN. RAYMUNDO JARQUE
(Ret.) and COL. DOMINADOR P. AMADOR (Ret.), petitioners,
vs.
L/T. GEN. HERMOGENES C. ESPERON, JR., respondent.
x-------------------------------------------x
DECISION
GARCIA, J.:
Before the Court are these two petitions having, as common denominator,
the issue of ownership of a large tract of land.
In the first, a petition for review under Rule 45 of the Rules of Court and
docketed as G.R. No. 156951, the petitioner Republic of the Philippines seeks
to nullify and set aside the Decision1 dated January 28, 2003 of the Court of
Appeals (CA) in CA-G.R. CV No. 59454, affirming the dismissal by the Regional
Trial Court (RTC) of Pasig City, Branch 71, of the Republic’s complaint for
declaration of nullity and cancellation of a land title against the herein
private respondent, the Southside Homeowners Association, Inc. (SHAI).
In the second, docketed as G.R. No. 173408, petitioners Rene Saguisag and
five (5) retired military officers pray that Lt. Gen. Hermogenes C. Esperon, Jr.,
the present Chief of Staff of the Armed Forces of the Philippines (AFP), be
asked to show cause why he should not be cited for contempt for having
announced time and again that the military officers and their families in the
contempt action would be ousted and evicted from the property subject of
the main petition even before the issue of ownership thereof is finally
resolved by the Court.
After the private respondent SHAI had filed its Comment2 to the petition in
G.R. No. 156951, the Bases Conversion Development Authority (BCDA),
followed by the Department of National Defense (DND) and the AFP, joined
causes with the petitioner Republic and thus sought leave to intervene. The
Court, per its Resolutions dated September 3, 2003,3 and September 29,
2003,4 respectively, allowed the intervention and admitted the
corresponding petitions-for-intervention.
Per Resolution of the Court dated August 09, 2006, both petitions were
ordered consolidated.
The Republic’s recourse in G.R. No. 156951 is cast against the following
backdrop:
On July 12, 1957, then President Carlos P. Garcia issued Proclamation No.
4235 establishing a military reservation known as Fort William McKinley –
later renamed Fort Andres Bonifacio Military Reservation (FBMR). The
proclamation "withdr[ew] from sale or settlement and reserve[d] for military
purposes, under the administration of the Chief of Staff of the [AFP] … the
[certain] parcels of the public domain [indicated in plan Psu-2031]" situated
in the several towns and a city of what was once the Province of Rizal. On its
face, the proclamation covers three (3) large parcels of land, to wit: Parcel
No. 2 (portion), Parcel No. 3 (or 3-A) and Parcel No. 4 (or 4-A). Parcel No. 3
with an area of 15,912,684 square meters and Parcel No. 4 with an area of
7,660,128 square meters are described in the proclamation as situated inside
Fort McKinley, Rizal. Specifically mentioned as excluded from Parcel No. 4
albeit within its boundaries are the American Battle Monument Cemetery
(606,985 sq. m.), the Traffic Circle (7,093 sq. m.) and the Diplomatic and
Consular area (100,000 sq.m.).
Several presidential proclamations would later issue excluding certain
defined areas from the operation of Proclamation No. 423 and declaring
them open for disposition. These are Proclamation No. 4616 and
Proclamation No. 462,7 both series of 1965, excluding portions of the
reservation and declaring them the AFP Officers’ Village and the AFP EM’s
Village, respectively, to be disposed of under Republic Act (R.A.) 2748 and
R.A. 7309 in relation to the Public Land Act (C.A. 141, as amended). Excluded,
too, under Proclamation No. 172 dated October 16, 1987 and to be disposed
pursuant to the same laws aforementioned, save those used or earmarked
for public/quasi-public purposes, are portions of the reservation known as
Lower and Upper Bicutan, Western Bicutan and the Signal Village, all in
Taguig, Metro Manila.
In 1992, Congress enacted the Bases Conversion and Development Act (R.A.
7227, as amended), investing the BCDA the power to own, hold and
administer portions of Metro Manila military camps that may be transferred
to it by the President10 and to dispose, after the lapse of a number of months,
portions of Fort Bonifacio.11
At the core of the instant proceedings for declaration of nullity of title are
parcels of land with a total area of 39.99 hectares, more or less, known as or
are situated in what is referred to as the JUSMAG housing area in Fort
Bonifacio. As may be gathered from the pleadings, military officers, both in
the active and retired services, and their respective families, have been
occupying housing units and facilities originally constructed by the AFP on
the JUSMAG area.
Private respondent SHAI is a non-stock corporation organized mostly by
wives of AFP military officers. Records show that SHAI was able to secure
from the Registry of Deeds of the Province of Rizal a title – Transfer
Certificate of Title (TCT) No. 1508412 - in its name to the bulk of, if not the
entire, JUSMAG area. TCT No. 15084 particularly describes the property
covered thereby as follows:
A parcel of land (Lot 3-Y-1, Psd-76057, being a portion of Parcel 3 of plan Psu-
2031) situated in Jusmang (sic) Area, Fort Bonifacio, Province of Rizal. …
containing an area of …(398,602) SQUARE METERS. xxx.
A parcel of land (Lot 3-Y-2, Psd-76057 as shown on subdivision Plan Psd
76057, being a portion of parcel 3 of plan Psu-2031, LRC Rec. No.) situated in
Jusmang (sic) Area, Fort Bonifacio, Province of Rizal. … containing an area of
… (1,320) SQUARE METERS xxx.. (Underscoring added.)
The Rizal Registry issued TCT No. 15084 on October 30, 1991 on the basis of a
notarized Deed of Sale13 purportedly executed on the same date by then
Director Abelardo G. Palad, Jr. (Palad, for brevity) of the Lands Management
Bureau (LMB) in favor of SHAI. The total purchase price as written in the
conveying deed was P11,997,660.00 or P30.00 per square meter.
It appears that in the process of the investigation conducted by the
Department of Justice on reported land scams at the FBMR, a copy of the
aforesaid October 30, 1991 deed of sale surfaced and eventually referred to
the National Bureau of Investigation (NBI) for examination. The results of the
examination undertaken by NBI Document Examiner Eliodoro Constantino
are embodied in his Questioned Documents Report (QDR) No. 815-1093.14 Its
highlights:
QUESTIONED SPECIMENS:
1. Original copy of the Deed of Sale … issued in favor of the Navy Officers
Village Association (NOVA) … containing the … signature of "ABELARDO G.
PALAD, JR." … designated as "Q-961" ….
2. Original copy of the Deed of Sale … issued in favor of SHAI … containing the
signature of "ABELARDO G. PALAD, JR." ... designated as "Q-962….
xxx xxx xxx
PURPOSE OF EXAMINATION:
To determine whether or not the questioned and sample/specimen
signatures "ABELARDO G. PALAD, JR." were written by one and the same
person.
FINDINGS:
Scientific comparative examination and analysis of the specimens, submitted,
under stereoscopic microscope and magnifying lens, with the aid of
photographic enlargement … reveals that there exist fundamental, significant
differences in writing characteristics between the questioned and the
standard/sample signatures "ABELARDO G. PALAD, JR." such as in:
- The questioned signatures show slow, drawn, painstaking laborious manner
in execution of strokes; that of the standard/sample signatures show free,
rapid coordinated and spontaneous strokes in the manner of execution of
letters/elements.
xxx xxx xxx
Furthermore, the questioned signature "ABELARDO G. PALAD, JR." marked
"Q-961" is a product of TRACING PROCESS by CARBON-OUTLINE METHOD.
CONCLUSION:
Based on the above FINDINGS, the questioned and the standard/sample
signatures "ABELARDO G. PALAD, JR." were not written by one and the same
person.
The questioned signature "ABELARDO G. PALAD, JR." marked "Q-961" is a
TRACED FORGERY by carbon process.
REMARKS:
The other questioned Deeds of Sale containing the signatures of "ABELARDO
G. PALAD, JR." are still in the process of examination.15
On October 16, 1993, then President Fidel V. Ramos issued Memorandum
Order No. 17316 directing the Office of the Solicitor General (OSG) to institute
action towards the cancellation of TCT No. 15084 and the title acquired by
the Navy Officer’s Village Association (NOVA) over a bigger parcel within the
reservation. A month later, the OSG, in behalf of the petitioner Republic, filed
with the RTC of Pasig City the corresponding nullification and cancellation of
title suit against the private respondent SHAI. In its complaint, docketed
as Civil Case No. 63883 and eventually raffled to Branch 71 of the court, the
Republic alleged that fraud attended SHAI’s procurement of TCT No. 15084.
In paragraph No. 5 of the complaint, the Republic alleged that TCT No. 15084
is void owing, inter alia, to the following circumstances: a) the conveying
deed is spurious as the purported signature thereon of Palad is a forgery; b)
there are no records with the LMB of (i) the application to purchase and (ii)
the alleged payment of the purchase price; and c) the property in question is
inalienable, being part of a military reservation established under
Proclamation No. 423.17
In its ANSWER with counterclaim, respondent SHAI denied the material
allegations of the complaint and countered that the impugned title as well as
the October 30, 1991 Deed of Sale are valid documents which the Republic is
estopped to deny.18 SHAI also alleged paying in full the purchase price
indicated in the deed as evidenced by Official Receipt No. 6030203-C dated
October 29, 1991.
On October 19, 1994, the case was heard on pre-trial in the course of which
the Republic, as plaintiff therein, marked (and later offered in evidence) the
Deed of Sale dated October 30, 1991 as its Exhibit "A," and TCT No. 15084
as Exhibit "B." Respondent, then defendant SHAI adopted Exhibits "A" and
"B" as its Exhibits "1" and "2," respectively. As the pre-trial order was
written, it would appear that the parties agreed to limit the issue to the due
execution and genuineness of Exhs. "A" and "B."19
During the trial, the Republic presented as expert witness NBI Document
Examiner Eliodoro Constantino who testified on NBI QDR No. 815-1093 and
asserted that the signature of Palad in Exhibit "A" is a forgery. For his part,
Palad dismissed as forged his signature appearing in the same document and
denied ever signing the same, let alone in front of a notary public holding
office outside of the LMB premises. Pressing the point, Palad stated that he
could not have had signed the conveying deed involving as it did a
reservation area which, apart from its being outside of the LMB’s jurisdiction,
is inalienable in the first place. The testimony of other witnesses revolved
around the absence of bureau records respecting SHAI’s application to
acquire, payment of the purchase price and Psd-76057, the plan described in
TCT No. 15084. 20
For its part, then defendant SHAI presented an opposing expert witness in
the person of Police Inspector Redencion Caimbon who brought with him
PNP QDR No. 001-96 and testified that Palad’s signature in Exhibit "A" (same
as Exh. "1") is genuine. Mrs. Virginia Santos, then SHAI president, likewise
testified, saying that applications to purchase were signed and then filed with
the LMB by one Engr. Eugenia Balis,21 followed by the payment in full of the
contract price. Atty. Vicente Garcia, the then Register of Deeds of Rizal, also
testified about his having endorsed to Palad a letter-inquiry he received from
SHAI respecting the authenticity of TCT No. 15084. Palad’s response-letter
dated January 23, 1992 (Exh. "10"), according to Atty. Garcia, is to the effect
that TCT No. 15084 must be genuine as it emanated from the Registry’s
office on the basis of the October 30, 1991 Deed of Sale.22
On rebuttal, Palad would deny authorship of Exhibit "10" and an LMB official
would disclaim transmitting the same to Atty. Garcia.
Eventually, in a decision23 dated October 7, 1997, the trial court rendered
judgment dismissing the Republic’s complaint, to wit:
WHEREFORE, in view of the foregoing, the Complaint dated November 15,
1991 is hereby DISMISSED without pronouncement as to costs.
The counterclaims are also DISMISSED.
SO ORDERED.
In not so many words, the trial court considered the parcels covered by the
deed in question as no longer part of the FBMR.
Therefrom, the Republic went on appeal to the CA whereat its appellate
recourse was docketed as CA-G.R. CV No. 59454.
In the herein assailed Decision24 dated January 28, 2003, the appellate court
affirmed in toto that of the trial court.
Hence, this petition of the Republic on the threshold abstract submission that
the CA "completely ignored, overlooked and/or grossly misappreciated facts
of substance which, if duly considered, will materially affect the outcome of
this case."
In its COMMENT To Petition, private respondent SHAI parlays the "what-can-
be-raised" line. It urges the dismissal of the petition on the ground that the
issues raised therein, particularly those bearing on the authenticity of Exhibit
"A"/"1," are mainly questions of fact, adding that the matter of the
inalienability of the area purportedly sold is outside the issue agreed upon
during the pre-trial stage.
The desired dismissal cannot be granted on the bases of the reasons
proffered above.
While the Court, in a petition for review of CA decisions under Rule 45 of the
Rules of Court, usually limits its inquiry only to questions of law, this rule is
far from absolute. Reyes v. Court of Appeals,25 citing Floro v. Llenado,26 for
one, suggests as much. In Floro, we wrote:
xxx There are, however, exceptional circumstances that would compel the
Court to review the finding of facts of the [CA], summarized in … and
subsequent cases as follows: 1) when the inference made is manifestly
mistaken, absurd or impossible; 2) when there is grave abuse of discretion; 3)
when the finding is grounded entirely on speculations, surmises or
conjectures; 4) when the judgment of the [CA] are based on
misapprehension of facts; 5) when the findings of facts are conflicting; 6) …;
7) …; 8) …; 9) when the [CA] manifestly overlooked certain relevant facts not
disputed by the parties and which if properly considered would justify a
different conclusion; and 10) when the findings of facts … are premised on
the absence of evidence and are contradicted by the evidence on record.
(Words in bracket, added.)
To the mind of the Court, the instant case is within the purview of at least
three of the exceptions listed above, foremost of which is item #9.
Private respondent SHAI’s stance about the petitioner Republic being barred
from raising the issue of inalienability since it failed to plead or assert the
same at the pre-trial proceedings is, to a degree, correct. For the general
rule, as articulated in Permanent Concrete Products, Inc. v. Teodoro, 27 is that
the determination of issues at a pre-trial conference bars the consideration
of others on appeal. It should be pointed out, however, that the rationale for
such preliminary, albeit mandatory, conference is to isolate as far as possible
the trial out of the realm of surprises and back-handed maneuverings. And
lest it be overlooked, the adverted rule on the procedure to be observed in
pre-trials is, as Bergano v. Court of Appeals 28 teaches, citing Gicano v.
Gegato,29 subject to exceptions. And without meaning to diminish the
importance of the same rule, the Court is possessed with inherent power to
suspend its own rules or to except a particular case from its operations
whenever the demands of justice so require.30
Given the foregoing considerations, the rule to be generally observed in pre-
trial conferences hardly poses an insurmountable obstacle to tackling the
question of inalienability which, under the premises, is an issue more legal
than factual. As it were, the element of surprise is not really present here.
For the issue of inalienability, which is central to the Republic’s cause of
action, was raised in its basic complaint, passed upon by the CA and, before
it, by the trial court31 and of which at least one witness (Palad) was examined
as follows:
Q: Mr. Witness you stated that the parcel of land in question at the time of
the land alleged sale was part of the … [FBMR]. Now as part of the …[FBRM]
do you know whether the said parcel of land can be the subject of
disposition?
A: If it is part of the reservation it cannot be sold and it is already part of
those government lands that has been assigned to other government
agencies that is no longer within my jurisdiction. Meaning to say I have no
more say on that because the proclamation to the effect was reserving this
for particular purpose under the DND ….32 (Words in bracket added.)
At any rate, Palad’s testimony drew nary an objection from private
respondent SHAI. It even cross-examined said witness. 33 The rule obtains that
the introduction of evidence bearing on an issue not otherwise included in
the pre-trial order amounts to implied consent conferring jurisdiction on the
court to try such issue.34
Digressing from the procedural aspects of this case, we now consider the
clashing assertions regarding the JUSMAG area. Was it, during the period
material, alienable or inalienable, as the case may be, and, therefore, can or
cannot be subject of a lawful private conveyance?
Petitioner Republic, as do the intervenors, asserts the inalienable character
of the JUSMAG area, the same having not effectively been separated from
the military reservation and declared as alienable and disposable.
The Republic’s and the intervenor’s parallel assertions are correct.
The President, upon the recommendation of the Secretary of Environment
and Natural Resources, may designate by proclamation any tract or tracts of
land of the public domain as reservations for the use of the Republic or any
of its branches, or for quasi-public uses or purposes.35 Such tract or tracts of
land thus reserved shall be non-alienable and shall not be subject to sale or
other disposition until again declared alienable. 36 Consistent with the
foregoing postulates, jurisprudence teaches that a military reservation, like
the FBMR, or a part thereof is not open to private appropriation or
disposition and, therefore, not registrable,37 unless it is in the meantime
reclassified and declared as disposable and alienable public land.38 And until a
given parcel of land is released from its classification as part of the military
reservation zone and reclassified by law or by presidential proclamation as
disposable and alienable, its status as part of a military reservation
remains,39 even if incidentally it is devoted for a purpose other than as a
military camp or for defense. So it must be here.
There can be no quibbling that the JUSMAG area subject of the questioned
October 30, 1991 sale formed part of the FBMR as originally established
under Proclamation No. 423. And while private respondent SHAI would
categorically say that the petitioner Republic had not presented evidence
that "subject land is within military reservation,"40 and even dared to state
that the JUSMAG area is the private property of the government and
therefore removed from the concept of public domain per se,41 its own
evidence themselves belie its posture. We start with its Exhibit "2"
(petitioner’s Exh. "B"), a copy of TCT No. 15084, which described the area
covered thereby measuring 399,922 square meters as a "portion of Parcel 3
of plan Psu-2031 situated in Jusmang (sic) area Fort Bonifacio."
Complementing its Exhibit "2" is its Exhibit "1" - the deed of sale - which
technically described the property purportedly being conveyed to private
respondent SHAI as follows:
A PARCEL OF LAND (Lot 3-Y-1, Psd-76067, being a portion of Parcel 3 of plan
Psu-2031) situated in Jusmag (sic) area, Fort Bonifacio, Province of Rizal. Xxx
(Emphasis added) …
As the Court distinctly notes, the disputed property, as described in private
respondent’s Exhibits "1" and "2," formed part of that wide expanse under
Proclamation No. 423 which lists, as earlier stated, three (3) parcels of land of
the public domain as falling within its coverage. These include, inter alia, the
entire 15,912,684-square meter area constituting Parcel No. 3 of Plan Psu
2031 located inside the now renamed Fort Mckinley which, to a redundant
point, was declared a military reservation.
The Court has, on the issue of inalienability, taken stock of the Compilation
Map of Approved Surveys Plan inside Parcels 1, 2, 3 and 4, of plan Psu
203142 prepared in September 1995 and certified by the Department of
Environment and Natural Resources (DENR). It indicates in colored ink the
outlines of Parcels 2, 3 and 4 covered by Proclamation No. 423. As there also
shown, the 399,992-square meter area embraced by SHAI’s TCT No. 15084,
defined in the legend by red-colored stripes, is within the violet-colored
borders of Parcel No. 3 and Parcel No. 4 of Proclamation No. 423.
Indubitably, the area covered by SHAI’s TCT No. 15084 was and is still part of
the FBMR, more particularly within the 15,912,684- square meter Parcel No.
3 of the reservation. The petitioner Republic, joined by the intervenors BCDA,
DND and AFP in this appellate proceedings, has maintained all along this
thesis. Towards discharging its burden of proving that the disputed property
is part of the reservation, the petitioner Republic need only to demonstrate
that all of the 15,912,684 square meters of Parcel No. 3 of Plan Psu 2031
have been reserved for military purposes. The evidence, however, of the fact
of reservation is the law or, to be more precise, Proclamation No. 423 itself,
the contents and issuance of which courts can and should take judicial notice
of under Section 1, Rule 129 of the Rules of Court.43
The Republic has, since the filing of its underlying complaint, invoked
Proclamation No. 423. In the process, it has invariably invited attention to the
proclamation’s specific area coverage to prove the nullity of TCT No. 15084,
inasmuch as the title embraced a reserved area considered inalienable, and
hence, beyond the commerce of man. In this regard, the appellate court
seemed to have glossed over, if not entirely turned a blind eye on, certain
admissions made by the private respondent, the most basic being those
made in its answer to the Republic’s allegations in paragraph 5 (e) and (g) of
its complaint. To the Republic’s allegations that the property covered by TCT
No. 15084 was and remains part the FBMR, SHAI’s answer thereto reads:
2. It specifically denies the allegations in paragraphs … 5 of the complaint,
the truth of the matter being that – in the Deed of Sale …, the Director of
Lands Certificate (sic) that he is "authorized under the law to sell" the subject
property and that the "lots were duly awarded by the [LBM] to the
vendee.44 ( Emphasis and word in bracket added.)
In net effect, private respondent SHAI admitted what the petitioner Republic
alleged in par. 5 (e) and (g) of the complaint, the former’s denial to such
allegations on the inalienable nature of the property covered by TCT No.
15084 being in the nature of a general denial. Under the rules on pleadings, a
specific, not a general, denial is required; a denial is not specific because it is
so qualified or termed "specific" by the pleader.45 The defendant must
specify each material factual allegation the truth of which he absolutely
denies and, whenever practicable, shall set forth the substance of the
matters upon which he will rely to support his denial. 46 Else, the denial will be
regarded as general and will, therefore, be regarded as an admission of a
given material fact/s stated in the complaint.
What private respondent SHAI did under the premises was to enter what,
under the Rules, is tantamount to a general denial of the Republic’s
averments that what SHAI’s TCT No. 15084 covers is part of the military
reservation. In the process, private respondent SHAI is deemed to admit the
reality of such averment.
To be sure, the petitioner Republic, as plaintiff below, had more than
sufficiently established its claim on the inalienability of the parcels of land
covered by TCT No. 15084. In fine, it had discharged the burden of proof on
the issue of inalienability. Be that as it may, the burden of evidence to
disprove inalienability or, to be precise, that said parcels of land had, for
settlement purposes, effectively been withdrawn from the reservation or
excluded from the coverage of Proclamation No. 423, devolves upon the
private respondent. This is as it should be for the cogency of SHAI’s claim
respecting the validity of both the underlying deed of sale (Exh. "A"/"1") and
its TCT No. 15084 (Exh. "B"/"2") rests on the postulate that what it
purportedly bought from the LMB had ceased to be part of the reserved
lands of the public domain. Elsewise put, SHAI must prove that the JUSMAG
area had been withdrawn from the reservation and declared open for
disposition, failing which it has no enforceable right over the area as against
the State.
Private respondent SHAI has definitely not met its burden by reason of lack
of evidence. To be sure, it has not, because it cannot even if it wanted to,
pointed to any presidential act specifically withdrawing the disputed parcels
from the coverage of Proclamation No. 423. Worse still, its own Exhibit
"5,"47 a letter dated March 19, 1991 of then PA Commanding General, M/Gen
Lisandro Abadia, to one Mrs. Gabon, then President of the SHAI, cannot but
be viewed as a party’s judicial admission that the disputed land has yet to be
excluded from the military reservation. The Abadia letter, with its feature dis-
serving to private respondent SHAI, reads in part as follows:
Dear Mrs. Gabon:
This is in connection with your move to make a petition to President Aquino
regarding the possible exclusion of Southside Housing Area from the military
reservation and for its eventual allotment to the … military officers presently
residing thereat. Allow me to state that I interpose no objection …. I find it …
helpful to our officers to be provided a portion of the Fort Bonifacio military
reservation …. (Underscoring added.)
Owing to the foregoing considerations, the Court is hard put to understand
how the CA could still have found for SHAI.. The appellate court, apparently
swayed by what SHAI said in its Brief for the Appellees48 that:
Appellant [petitioner Republic] is probably unaware that …, then President
Diosdado Macapagal … issued Proclamation 461 when he excluded from the
operation of Proclamation No. 423 … an area of 2,455,810 square meters
more or less…. Likewise on October 16, 1987, then President Corazon Aquino
issued Proclamation No. 172 excluding five (5) parcels of land from the
operation of Proclamation No. 423 also located at Fort Bonifacio containing
an area of 4,436, 478 …. So if we deduct the 6,892,288 [2,455,810 +
4,436,478 = 6,892,288] square meters covered by Proclamation Nos. 461 and
172 of the areas reserved for military purposes of 7,053,143 square meters,
what is only left is 160,857 square meters or more or less 16 hectares …. 49
justified its holding on the alienability of the disputed land with the following
disquisition:
The foregoing admission aside, appellant’s [now petitioner’s] reliance on
Proclamation No. 493 [should be 423] in insisting that the land in litigation is
inalienable because it is part of the [FBMR] is too general to merit serous
consideration. While it is true that, under the said July 12, 1957
Proclamation, then President Carlos P. Garcia reserved the area now known
as Fort Bonifacio for military purposes, appellee [now respondent] correctly
calls our attention to the fact, among other matters, that numerous
exceptions thereto had already been declared through the years. The
excluded areas under Proclamation No. 461, dated September 29, 1965 and
Proclamation No. 172, dated October 16, 1987 alone already total 6,892,338
square meters. (Figures in bracket added.)
The CA’s justifying line does not commend itself for concurrence.
For one, it utilizes SHAI’s misleading assertion as a springboard to justify
speculative inferences. Per our count, Proclamation 423 reserved for military
purposes roughly a total area of 25,875,000 square meters, not 7,053,143.
On the other hand, Proclamation Nos. 461 and 172 excluded a combined
area of 6,892,338 square meters. Now then, the jump from an
acknowledgment of the disputed parcels of land having been reserved for
military purposes to a rationalization that they must have been excluded
from the reservation because 6,892,338 square meters had already been
withdrawn from Proclamation 423 is simply speculative. Needless to stress,
factual speculations do not make for proof.
Corollary to the first reason is the fact that private respondent SHAI - and
quite understandably, the appellate court - had not pointed to any
proclamation, or legislative act for that matter, segregating the property
covered by TCT No. 15084 from the reservation and classifying the same as
alienable and disposable lands of the public domain. To reiterate what we
earlier said, lands of the public domain classified as a military reservation
remains as such until, by presidential fiat or congressional act, the same is
released from such classification and declared open to disposition. 50 The
October 30, 1991 Deed of Sale purportedly executed by Palad, assuming for
the nonce its authenticity, could not plausibly be the requisite classifying
medium converting the JUSMAG area into a disposable parcel. And private
respondent SHAI’s unyielding stance that would have the Republic in
estoppel to question the transfer to it by the LMB Director of the JUSMAG
area is unavailing. It should have realized that the Republic is not usually
estopped by the mistake or error on the part of its officials or agents. 51
Since the parcels of land in question allegedly sold to the private respondent
are, or at least at the time of the supposed transaction were, still part of the
FBMR, the purported sale is necessarily void ab initio.
The Court can hypothetically concede, as a matter of fact, the withdrawal of
the JUSMAG area from the ambit of Proclamation No. 423 and its
reclassification as alienable and disposable lands of the public domain. Still,
such hypothesis would not carry the day for private respondent SHAI. The
reason therefor is basic: Article XII, Section 352 of the 1987 Constitution
forbids private corporations from acquiring any kind of alienable land of the
public domain, except through lease for a limited period. While Fr. Bernas
had stated the observation that the reason for the ban is not very clear under
existing jurisprudence,53 the fact remains that private corporations, like SHAI,
are prohibited from purchasing or otherwise acquiring alienable public lands.
Even if on the foregoing score alone, the Court could write finis to this
disposition. An appropriate closure to this case could not be had, however,
without delving to an extent on the issue of the validity of the October 30,
1991 Deed of Sale which necessarily involves the question of the authenticity
of what appears to be Palad’s signature thereon.
With the view we take of the case, the interplay of compelling circumstances
and inferences deducible therefrom, would, as a package, cast doubt on the
authenticity of such deed, if not support a conclusion that the deed is
spurious. Consider:
1. Palad categorically declared that his said signature on the deed is a
forgery. The Court perceives no reason why he should lie, albeit respondent
states, without elaboration, that Palad’s declaration is aimed at avoiding
"criminal prosecution".54 The NBI signature expert corroborated Palad’s
allegation on forgery.55 Respondent SHAI’s expert witness from the PNP,
however, disputes the NBI’s findings. In net effect, both experts from the NBI
and the PNP cancel each other out.
2. Palad signed the supposed deed of sale in Manila, possibly at the LMB
office at Plaza Cervantes, Binondo. Even if he acted in an official capacity,
Palad nonetheless proceeded on the same day to Pasig City to appear before
the notarizing officer. The deed was then brought to the Rizal Registry and
there stamped "Received" by the entry clerk. That same afternoon, or at 3:14
p.m. of October 30, 1991 to be precise, TCT No. 15084 was issued. In other
words, the whole conveyance and registration process was done in less than
a day. The very unusual dispatch is quite surprising. Stranger still is why a
bureau head, while in the exercise of his functions as the bureau’s authorized
contracting officer, has to repair to another city just to have a deed
notarized.
3. There is absolutely no record of the requisite public land application to
purchase required under Section 89 of the Public Land Act.56 There is also no
record of the deed of sale and of documents usually accompanying an
application to purchase, inclusive of the investigation report and the
property valuation. The Certification under the seal of the LMB bearing date
November 24, 1994 and issued/signed by Alberto Recalde, OIC, Records
Management Division of the LMB pursuant to a subpoena issued by the trial
court57 attest to this fact of absence of records. Atty. Alice B. Dayrit, then
Chief, Land Utilization and Disposition Division, LMB, testified having
personally looked at the bureau record book, but found no entry pertaining
to SHAI.58
4. In its Answer as defendant a quo, respondent SHAI states that the "deed of
sale specifically meritorious Official Receipt No. 6030203—C dated 29
October 1991, (sic) as evidence of full payment … of the agreed purchase
price….." An official receipt (O.R.) is doubtless the best evidence to prove
payment. While it kept referring to O.R. No. 6030203 as its evidence of the
required payment,59 it failed to present and offer the receipt in evidence.
A Certification under date September 15, 1993 of the OIC Cash Division, LMB,
states that "OR # 6030203 in the amount of P11,977,000.00 supposedly paid
by [SHAI] is not among the series of [ORs] issued at any time by the National
Printing Office to the Cashier, LMB, Central Office."60 A copy of the OR receipt
is not appended to any of the pleadings filed before the Court. We can thus
validly presume that no such OR exists or, if it does, that its presentation
would be adverse to SHAI.
A contract of sale is void where the price, which appears in the document as
paid has, in fact, never been paid.61
5. The purchase price was, according to the witnesses for SHAI, paid in full in
cash to the cashier of the LMB the corresponding amount apparently coming
in a mix of P500 and P100 denominations. Albeit plausible, SHAI’s witnesses’
account taxes credulity to the limit.
A final consideration in G.R. No. 156951. This case could not have come to
pass without the participation of a cabal of cheats out to make a dishonest
buck at the expense of the government and most likely the members of SHAI.
No less than its former president (Ms. Virginia Santos) testified that a
"facilitator" did, for a fee, the necessary paper and leg work before the LMB
and the Registry of Deeds that led to the execution of the Deed of Sale and
issuance of the certificate of title in question.62 Ms. Santos identified Eugenia
Balis, a geodetic engineer, as the "facilitator"63 who "facilitated all these
presentation" of documents,64 and most of the time, "directly transacted"
with the LMB and the Register of Deeds leading to acquisition of title.65 Engr.
Balis was, in the course of Ms. Santos’ testimony, directly mentioned by
name for at least fifteen (15) times. Not surprisingly, Engr. Balis did not
appear in court, despite SHAI’s stated intention to present her as witness. 66
The extent of the misappropriation of the Fort Bonifacio land involved in this
and the NOVA area litigations is, as described in the Report of the Fact–
Finding Commission,67 "so epic in scale as to make the overpricing of land …
complained of in the two hundred AFP [Retirement and Separation Benefits
System] RSBS cases (P703 million) seem like petty shoplifting in
comparison."68 The members of private respondent SHAI may very well have
paid for what they might have been led to believe as the purchase price of
the JUSMAG housing area. The sad reality, however, is that the over P11
Million they paid, if that be the case, for a piece of real estate contextually
outside the commerce of man apparently fell into the wrong hands and did
not enter the government coffers. Else, there must be some memorials of
such payment.
At bottom, this disposition is nothing more than restoring the petitioner
Republic, and eventually the BCDA, to what rightfully belongs to it in law and
in fact. There is nothing unjust to this approach.
With the foregoing disquisitions, the petition for contempt in G.R. No.
173408 need not detain us long. As it were, the question raised by the
petitioners therein respecting the ownership of the JUSMAG area and,
accordingly, of the right of the petitioning retired military officers to remain
in the housing units each may be occupying is now moot and academic.
However, contempt petitioners’ expressed revulsion over the efforts of the
military establishment, particularly the AFP Chief of Staff, to oust them from
their respective dwellings, if that really be the case, even before G.R. No.
156951 could be resolved, is understandable as it is justified. We thus end
this ponencia with a reminder to all and sundry that might is not always right;
that ours is still a government of laws and not of men, be they in the civilian
or military sector. Accordingly, the Court will not treat lightly any attempt to
trifle, intended or otherwise, with its processes and proceedings. A becoming
respect to the majesty of the law and the prerogatives of the Court is a must
for the orderly administration of justice to triumph.
WHEREFORE, the petition in G.R. No. 156951 is GRANTED and the appealed
CA Decision is REVERSED and SET ASIDE. Accordingly, the Deed of Sale dated
October 30, 1991 (Exh. "A"/"1") purportedly executed in favor of private
respondent SHAI and TCT No. 15084 (Exh. "B"/"2") of the Registry of Deeds
of Rizal issued on the basis of such deed are declared VOID. The Register of
Deeds of Pasig or Taguig, as the case may be, is hereby ordered to CANCEL
TCT No. 15084 in the name of SHAI and the area covered thereby
is DECLARED part of the Fort Bonifacio Military Reservation, unless the same
has, in the interim, been duly excluded by law or proclamation from such
reservation. Private respondent SHAI, its members, representatives and/or
their assigns shall vacate the subject parcels of land immediately upon the
finality of this decision, subject to the provisions of Republic Act No. 7227,
otherwise known as the Bases Conversion and Development Act.
Cost against the private respondent SHAI.
Having said our piece in G.R. No. 173408, we need not speak any further
thereon other than to deny as we hereby similarly DENY the same.
SO ORDERED.