CASE DIGEST]

Chavez v. Public

Estates Authority

(G.R. No. 133250)

July 9, 2002

FACTS:

Through PD No.

1084, the Public

Estates Authority

(PEA) was tasked by

former president and

dictator Ferdinand

Marcos, to reclaim

land, including

foreshore and

submerged areas and

to develop, improve,

acquire, lease and sell

any and all kinds of

lands. As a result, an

amendment was made

on a previous contract

with Construction and

Development

Corporation of the

Philippines (CDCP).

Prior to PEA, CDCP

was tasked to reclaim

certain forshore and

offshore areas of

Manila Bay. The

amended contract

now directed CDCP

to transfer to PEA all

the development

rights, title, interest

and partitipation of

CDCP in the

reclamation.

Under former

President Cory

Aquino, titles of

parcels of land
reclaimed under

Manila-Cavite

Coastal Road and

Reclamation Project

(MCCRRP) were

transferred to PEA.

These covered three

reclaimed islands

known as the

“Freedom Islands.”

PEA entered into a

Joint Venture

Agreement (JVA)

with AMARI, a

private corporation to

develop the Freedom

Islands, notably the

reclamation of an

additional 250 ha of

submerged areas

surrounding these

islands to complete
the plan. The JVA

was entered into

through negotiation

without public

bidding. Former

President Fidel

Ramos then approved

the JVA.

Controvery broke out

when then Senate

President Ernesto

Maceda denouced the

JVA as the

grandmother of all

scams. The Senate

conducted a joint

investigation and

concluded that the

reclaimed lands PEA

seeks to transfer to

AMARI under the

JVA are lands of

public domain which

the government has

not classified as

alienable lands and

therefore PEA cannot

alienate these lands.

Moreover, the

certificates of title

covering the Freedom

Islands were void, and

that the JVA itself

was illegal.

In his capacity as

taxpayer, petitioner

Frank Chavez filed a

petition for

mandamus with

prayer for the

issuance of a writ of

preliminary injunction

and temporary

restraining order. He
argued that the

government will lose

billions of pesos in

the JVA. He sought

for the public

disclosure of the

renegotiation of the

JVA, invoking

Constitutional right of

the people to

information on

matters of public

concern.

He also alleged that

the JVA is against the

Constitutional

prohibition on the sale

of alienable lands of

the public domain to

public corporations.
A year after the filing

of the petition, PEA

and AMARI signed

the Amended Joint

Venture Agreement

(Amended JVA).

Former President

Estrada signed the

Amended JVA.

ISSUES:

Whether the amended

JVA violates the

Constitution. -- YES.

Whether information

on ongoing

negotiations may be

disclosed to the

public. -- NO.

HELD:
The Amended JVA

covers a reclamation

area of 750 hectares.

Only 157. 84 ha have

been reclaimed. The

rest are still

submerged areas

forming part of

Manila Bay. Under

the agreement,

AMARI will shoulder

the reclamation of the

freedom island and it

will get 70% of the

usable area. AMARI

wil acquire and own a

maximum of 367.5 ha

of reclaimed land

wich will be titled in

its name.

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.

Freedom Islands are

thus alienable or

disposable lands of

the public domain,

open to disposition or

concession to

qualified parties.

However, at this time,

the Freedom Islands

were no longer part of

Manila Bay but part

of the land mass after

PEA had already

reclaimed it.

However, the

additional 592.15 ha

are still submerged

and forming part of

the Manila Bay. There

is also no legislative

or presidential act

regarding these

remaining areas.

Also, the mere

physical act of

reclamation of 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. It still

needs the

authorization of

DENR, which

classifies lands of

public domain into

alienable or

disposable lands

subject to the

President’s approval.

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.

PEA is also mandated

to call for a public

bidding. Only if this

failed that a

negotiated sale is

allowed. The failure

of the public bidding

involving only 407.84

ha is not a valid

justification for a

negotiated sale of 750

ha.

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.

Ownership of PEA of

the said lands of

public domain does

not convert them to

private lands.

Jurisprudence holding

that there is

conversion to private

land upon the grant of

the patent or issuance

of the certificate of

title does not apply to

government units like

PEA.

The rationale behind

ban on corporation

acquiring, except

through lease,
alienable lands of

public domain 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

spawn social unrest.

In practice, this ban

strengthens limitation

on individuals from

acquiring more than

the allowed area by

simply stting up a

corporation to acquire

more land.

On the right to

information:
The right to

information does not

extend to matters

recognized as

privileged

information under the

separation of powers.

In this case, the

information

demanded by Chavez

is privileged

information rooted in

the separation of

powers.