Case: Paat v.

CA

Doctrine:

the principle of exhaustion of administrative remedies as tested by a battery of cases is not an ironclad
rule. This doctrine is a relative one and its flexibility is called upon by the peculiarity and uniqueness of
the factual and circumstantial settings of a case. Hence, it is disregarded

(1) when there is a violation of due process,

(2) when the issue involved is purely a legal question,

(3) when the administrative action is patently illegal amounting to lack or excess of jurisdiction,

(4) when there is estoppel on the part of the administrative agency concerned,

(5) when there is irreparable injury,

(6) when the respondent is a department secretary whose acts as an alter ego of the President bears the
implied and assumed approval of the latter,

(7) when to require exhaustion of administrative remedies would be unreasonable,

(8) when it would amount to a nullification of a claim,

(9) when the subject matter is a private land in land case proceedings,

(10) when the rule does not provide a plain, speedy and adequate remedy, and

(11) when there are circumstances indicating the urgency of judicial intervention.

— The assumption by the trial court of the replevin suit led by private respondents constitutes an
unjustified encroachment into the domain of the administrative agency's prerogative. The doctrine of
primary jurisdiction does not warrant a court to arrogate unto itself the authority to resolve a
controversy the jurisdiction over which is initially lodged with an administrative body of special
competence.

Section 68-A of P.D. 705, as amended by E.O. 277, that the Secretary and his duly authorized that the
courts representatives are given the authority to confiscate and forfeit any conveyances utilized in
violating the Code or other forest laws, rules and regulations.

With, the introduction of Executive Order No. 277, amending Section 68 of P.D. 705, the act of cutting,
gathering, collecting, removing, or possessing forest products without authority constitutes a distinct
offense independent now from the crime of theft under Articles 309 and 310 of the Revised Penal Code,
but the penalty to be imposed is that provided for under Articles 309 and 310 of the Revised Penal Code.

Facts:

May 19, 1989- truck of respondent (Victoria de Guzman) was seized by DENR because the driver could
not produce the required documents for the forest products concealed in the truck.
May 23, 1989- CENRO officer Layugan issued an order of confiscation of the truck and gave owner 15
days within which to submit an explanation as to why the truck won’t be forfeited. Respondents failed
to submit explanation.

June 22, 1989- Regional Executive Director Baggayan of DENR (RED for brevity) sustained action of
confiscation and ordered forfeiture of the truck (Section 68-A of Presidential Decree No. 705 as
amended by Executive Order No. 277)

June 28, 1989- Respondents filed a letter of consideration but was denied in the order of July 12, 1989.

Case was brought by petitioners to the secretary of DENR pursuant to the letter of the respondents and
stated in their letter for reconsideration would be denied then "this letter should be considered as an
appeal to the Secretary.

Pending resolution a suit for replevin was filed by respondents against Layugan and RED with a writ
ordering the return of the truck. Layugan and RED filed a motion to dismiss on the grounds of failure to
exhaust administrative remedies.

TC: denied motion to dismiss. MR also denied.

CA: sustained TC that question involved is purely legal question.

Issues:

1. Whether or not trial court has jurisdiction

2. Without violating the principle of exhaustion of administrative remedies, may an

action for replevin prosper to recover a movable property which is the subject matter of an

administrative forfeiture proceeding in the Department of Environment and Natural

Resources pursuant to Section 68-A of P. D. 705, as amended, entitled The Revised

Forestry Code of the Philippines?

3. Are the Secretary of DENR and his representatives empowered to confiscate and

forfeit conveyances used in transporting illegal forest products in favor of the

government?

4. Whether or not there is no crime defined and punishable under Section 68 other than qualidied
theft.

Ruling:

1. No. The trial court has no jurisdiction. Due process does not necessarily mean or require a
hearing, but simply an opportunity or right to be heard. One may be heard, not solely by verbal
presentation but also, and perhaps many times more creditably and practicable than oral
 argument, through pleadings. In administrative proceedings moreover, technical rules of
procedure and evidence are not strictly applied; administrative process cannot be fully equated
with due process in its strict judicial sense. Indeed, deprivation of due process cannot be
successfully invoked where a party was given the chance to be heard on his motion for
reconsideration, as in the instant case, when private respondents were undisputedly given the
opportunity to present their side when they filed a letter of reconsideration dated June 28, 1989
which was, however, denied in an order of July 12, 1989 of Executive Director Baggayan.

2. a suit for replevin cannot be sustained against the petitioners for the subject truck taken and
retained by them for administrative forfeiture proceedings in pursuant to Section 68-A of the P.
D. 705, as amended. Dismissal of the replevin suit for lack of cause of action in view of the
private respondents' failure to exhaust administrative remedies should have been the proper
course of action by the lower court instead of assuming jurisdiction over the case and
consequently issuing the writ ordering the return of the truck. Exhaustion of the remedies in the
administrative forum, being a condition precedent prior to one's recourse to the courts and
more importantly, being an element of private respondents' right of action, is too significant to
be waylaid by the lower court.

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

“SECTION 68. xxx xxx The court shall further order the confiscation in favor of the government
of the timber or any forest products cut, gathered, collected, removed, or possessed, as well as
the machinery, equipments, implements and tools illegaly [sic] used in the area where the
timber or forest products are found.”

It is, thus, clear from the foregoing provision that the Secretary and his duly authorized representatives
are given the authority to confiscate and forfeit any conveyances utilized in violating the Code or other
forest laws, rules and regulations. The phrase "to dispose of the same" is broad enough to cover the act
of forfeiting conveyances in favor of the government. The only limitation is that it should be made "in
accordance with pertinent laws, regulations or policies on the matter."

4. With the introduction of Executive Order No. 277 amending Section 68 of P.D. 705, the act of
cutting, gathering, collecting, removing, or possessing forest products without authority
constitutes a distinct offense independent now from the crime of theft under Articles 309 and
310 of the Revised Penal Code, but the penalty to be imposed is that provided for under Article
309 and 310 of the Revised Penal Code. This is clear from the language of Executive Order No.
277 when it eliminated the phrase "shall be guilty of qualified theft as defined and punished
under Articles 309 and 310 of the Revised Penal Code " and inserted the words " shall be
 punished with the penalties imposed under Article 309 and 310 of the Revised Penal Code".
When the statute is clear and explicit, there is hardly room for any extended court ratiocination
or rationalization of the law

Dispositive:

WHEREFORE, the Petition is GRANTED; the Decision of the respondent Court of Appeals dated October
16, 1991 and its Resolution dated July 14, 1992 are hereby SET ASIDE AND REVERSED; the Restraining
Order promulgated on September 27, 1993 is hereby made permanent; and the Secretary of DENR is
directed to resolve the controversy with utmost dispatch. SO ORDERED

Republic v. Pagadian City Timber

Doctrine:

Facts:

Republic of the Philippines and Pagadian City Timber Co. Inc. executed Industrial Management
Agreement (IFMA) [Oct. 14,1994] to utilize, develop, and manage 1999.5 hectares of land in Zamboanga
del Sur (for the production of timber and other forest products) according to the Comprehensive
Development and Management Plan (CDMP) approved by the DENR [Aug 17,1995].

Some years passed, and in response to several complaints filed by members of the Subanen tribe, [Oct.
8,1998] the DENR Region IX creates a team to evaluate and assess IFMA.

Oct. 22, 1998 DENR send a letter giving notice of the evaluation to be conducted.

Oct. 23, 1998 DENR evaluation team went to the IFMA site and conducted an assessment.

The ff. are the findings presented in the Oct. 29, 1998 exit conference:

- Only 98 out of 2,008 seedling hills survived

- Some areas planted on belong to the Certificates of Stewardship Contracts (CSC)
- Only 1 look-out tower, 1 bunkhouse, 1 stockroom, 1 dilapidated billboard poster, 1 multi-
purpose shed, 2 concrete monuments
- Facilities generally below par
- Only 28% of the target goal area planted

DENR evaluation team asked Santiago (Operations Manager of PCT) if he had any questions, he replied
none and requested a copy of the report.

Nov. 6, 1998 the Evaluation Team submitted a report through a memorandum and made the following
recommendations:

1. The lessee should be required to explain why they failed to develop their IFMA area (Plantation
Development) in accordance with the approved Comprehensive Development and Management
Plan (CDMP);
 2. The boundary and area coverage of IFMA No. R9-040 should be amended to exclude areas
covered by Certificates of Stewardship Contracts (CSC) under the ISF Program with an area of 226.17
hectares, other areas previously identified as "occupied/claimed" and other conflict areas;

3. The amended boundary should be delineated/surveyed on the ground with a precise instrument
and all corners appropriately marked/monumented;

4. The company should hire a full-time forester.

April 7, 1999 Regional Executive Director Mendoza submitted to the DENR Secretary a memorandum
regarding the performance evaluation of IFMA and recommended its cancellation.

DENR Sec. Cerilles issued an order cancelling IFMA, which was affirmed by the Office of the President.

CA: ruled that IFMA is a contract and could not be unilaterally canceled.

Issue:

1. Whether or not IFMA is a contract.

2. Whether or not respondent is entitled to a prior arbitration under IFMA before the license
agreement is to be canceled.

Ruling:

1. YES. IFMA is a license agreement under PD 705, which defines a license as “a privilege granted
by the state to a person” and such is evident in the IFMA itself. But even assuming the IFMA
could be a contract, the alleged property rights are not absolute. Moreover, all Filipino citizens
have the right to a balanced and healthful ecology, which has the correlative duty to refrain
from impairing the environment. The DENR is the instrumentality of the State mandated to
actualize the policy, and private rights must yield when they conflicted with public policy and
common interest.
2. NO. Sec. 35 of the IFMA uses the word “may” which is interpreted to mean that petitioner has
the discretion whether or not to give notice and allow the option to remedy the breach. PCT is
not entitled to arbitration under Sec. 36 of IFMA as the cancellation was based on Sec. 26 of
DAO No. 97-04 (failure to implement CDMP and agreements with communities and relevant
sectors). Respondents were given the opportunity to contest the findings when they filed their
appeal and MR before the Office of the President. A party cannot feign denial of due process
where he had been afforded the opportunity to present his side.

Dispositive:

WHEREFORE, the Decision dated October 18, 2001 and the Resolution dated July 24, 2003 of the Court
of Appeals in CA-G.R. SP No. 59194 are REVERSED and SET ASIDE, and the Order dated June 7, 1999 of
then DENR Secretary Antonio Cerilles, and the Resolutions of the Office of the President dated January
12, 2000 and May 8, 2000 affirming the said Order, are REINSTATED and AFFIRMED. No pronouncement
as to costs. SO ORDERED