Sie sind auf Seite 1von 60

Law on NatRes (73-83 1

DIDIPIO EARTH-SAVERS MULTI-PURPOSE DUHALNGON, PETER BENNEL, JOSEPH T.


ASSOCIATION, INCORPORATED (DESAMA), MANUEL BUNGGALAN, JIMMY B. KIMAYONG, HENRY
BUTIC, CESAR MARIANO, LAURO ABANCE, BEN PUGUON, PEDRO BUHONG, BUGAN NADIAHAN, SR.,
TAYABAN, ANTONIO DINGCOG, TEDDY B. MARIA EDEN ORLINO, SPC, PERLA VISSORO, and
KIMAYONG, ALONZO ANANAYO, ANTONIO MALAN- BISHOP RAMON VILLENA, Petitioners, vs. ELISEA
UYA, JOSE BAHAG, ANDRES INLAB, RUFINO GOZUN, in her capacity as SECRETARY of the
LICYAYO, ALFREDO CULHI, CATALILNA INABYUHAN, DEPARTMENT OF ENVIRONMENT and NATURAL
GUAY DUMMANG, GINA PULIDO, EDWIN ANSIBEY, RESOURCES (DENR), HORACIO RAMOS, in his
CORAZON SICUAN, LOPEZ DUMULAG, FREDDIE capacity as Director of the Mines and Geosciences
AYDINON, VILMA JOSE, FLORENTINA MADDAWAT, Bureau (MGB-DENR), ALBERTO ROMULO, in his
LINDA DINGCOG, ELMER SICUAN, GARY ANSIBEY, capacity as the Executive Secretary of the Office of
JIMMY MADDAWAT, JIMMY GUAY, ALFREDO CUT- the President, RICHARD N. FERRER, in his capacity as
ING, ANGELINA UDAN, OSCAR INLAB, JUANITA CUT- Acting Undersecretary of the Office of the President,
ING, ALBERT PINKIHAN, CECILIA TAYABAN, CRISTA IAN HEATH SANDERCOCK, in his capacity as
BINWAK, PEDRO DUGAY, SR., EDUARDO ANANAYO, President of CLIMAX-ARIMCO Mining Corporation.
ROBIN INLAB, JR., LORENZO PULIDO, TOMAS Respondents; G.R. No. 157882 March 30, 2006
BINWAG, EVELYN BUYA, JAIME DINGCOG, DINAOAN
CUT-ING, PEDRO DONATO, MYRNA GUAY, FLORA This petition for prohibition and mandamus under Rule 65
ANSIBEY, GRACE DINAMLING, EDUARDO MENCIAS, of the Rules of Court assails the constitutionality of
ROSENDA JACOB, SIONITA DINGCOG, GLORIA Republic Act No. 7942 otherwise known as the Philippine
JACOB, MAXIMA GUAY, RODRIGO PAGGADUT, Mining Act of 1995, together with the Implementing Rules
MARINA ANSIBEY, TOLENTINO INLAB, RUBEN and Regulations issued pursuant thereto, Department of
DULNUAN, GERONIMO LICYAYO, LEONCIO CUMTI, Environment and Natural Resources (DENR)
MARY DULNUAN, FELISA BALANBAN, MYRNA Administrative Order No. 96-40, s. 1996 (DAO 96-40) and
DUYAN, MARY MALAN-UYA, PRUDENCIO ANSIBEY, of the Financial and Technical Assistance Agreement
GUILLERMO GUAY, MARGARITA CULHI, ALADIN (FTAA) entered into on 20 June 1994 by the Republic of
ANSIBEY, PABLO DUYAN, PEDRO PUGUON, JULIAN the Philippines and Arimco Mining Corporation (AMC), a
INLAB, JOSEPH NACULON, ROGER BAJITA, DINAON corporation established under the laws of Australia and
GUAY, JAIME ANANAYO, MARY ANSIBEY, LINA owned by its nationals.
ANANAYO, MAURA DUYAPAT, ARTEMEO ANANAYO,
MARY BABLING, NORA ANSIBEY, DAVID DULNUAN, On 25 July 1987, then President Corazon C. Aquino
AVELINO PUGUON, LUCAS GUMAWI, LUISA ABBAC, promulgated Executive Order No. 279 which authorized
CATHRIN GUWAY, CLARITA TAYABAN, FLORA the DENR Secretary to accept, consider and evaluate
JAVERA, RANDY SICOAN, FELIZA PUTAKI, CORAZON proposals from foreign-owned corporations or foreign
P. DULNUAN, NENA D. BULLONG, ERMELYN GUWAY, investors for contracts of agreements involving either
GILBERT BUTALE, JOSEPH B. BULLONG, technical or financial assistance for large-scale
FRANCISCO PATNAAN, JR., SHERWIN DUGAY, TIRSO exploration, development, and utilization of minerals,
GULLINGAY, BENEDICT T. NABALLIN, RAMON PUN- which, upon appropriate recommendation of the Secretary,
ADWAN, ALFONSO DULNUAN, CARMEN D. BUTALE, the President may execute with the foreign proponent.
LOLITA ANSIBEY, ABRAHAM DULNUAN, ARLYNDA
BUTALE, MODESTO A. ANSIBEY, EDUARDO LUGAY, On 3 March 1995, then President Fidel V. Ramos signed
ANTONIO HUMIWAT, ALFREDO PUMIHIC, MIKE TINO, into law Rep. Act No. 7942 entitled, "An Act Instituting A
TONY CABARROGUIS, BASILIO TAMLIWOK, JR., New System of Mineral Resources Exploration,
NESTOR TANGID, ALEJO TUGUINAY, BENITO Development, Utilization and Conservation," otherwise
LORENZO, RUDY BAHIWAG, ANALIZA BUTALE, known as the Philippine Mining Act of 1995.
NALLEM LUBYOC, JOSEPH DUHAYON, RAFAEL
CAMPOL, MANUEL PUMALO, DELFIN AGALOOS, On 15 August 1995, then DENR Secretary Victor O.
PABLO CAYANGA, PERFECTO SISON, ELIAS Ramos issued DENR Administrative Order (DAO) No. 23,
NATAMA, LITO PUMALO, SEVERINA DUGAY, Series of 1995, containing the implementing guidelines of
GABRIEL PAKAYAO, JEOFFREY SINDAP, FELIX Rep. Act No. 7942. This was soon superseded by DAO
TICUAN, MARIANO S. MADDELA, MENZI TICAWA, No. 96-40, s. 1996, which took effect on 23 January 1997
DOMINGA DUGAY, JOE BOLINEY, JASON ASANG, after due publication.
TOMMY ATENYAYO, ALEJO AGMALIW, DIZON
AGMALIW, EDDIE ATOS, FELIMON BLANCO, DARRIL Previously, however, or specifically on 20 June 1994,
DIGOY, LUCAS BUAY, ARTEMIO BRAZIL, NICANOR President Ramos executed an FTAA with AMC over a total
MODI, LUIS REDULFIN, NESTOR JUSTINO, JAIME land area of 37,000 hectares covering the provinces of
CUMILA, BENEDICT GUINID, EDITHA ANIN, INOH- Nueva Vizcaya and Quirino. Included in this area is
YABAN BANDAO, LUIS BAYWONG, FELIPE Barangay Dipidio, Kasibu, Nueva Vizcaya.
Law on NatRes (73-83 2

II
Subsequently, AMC consolidated with Climax Mining
Limited to form a single company that now goes under the Whether or not the Mining Act and its Implementing Rules
new name of Climax-Arimco Mining Corporation (CAMC), and Regulations are void and unconstitutional for
the controlling 99% of stockholders of which are Australian sanctioning an unconstitutional administrative process of
nationals. determining just compensation.

On 7 September 2001, counsels for petitioners filed a III


demand letter addressed to then DENR Secretary
Heherson Alvarez, for the cancellation of the CAMC FTAA Whether or not the State, through Republic Act No. 7942
for the primary reason that Rep. Act No. 7942 and its and the CAMC FTAA, abdicated its primary responsibility
Implementing Rules and Regulations DAO 96-40 are to the full control and supervision over natural resources.
unconstitutional. The Office of the Executive Secretary
was also furnished a copy of the said letter. There being IV
no response to both letters, another letter of the same
content dated 17 June 2002 was sent to President Gloria Whether or not the respondents interpretation of the role
Macapagal Arroyo. This letter was indorsed to the DENR of wholly foreign and foreign-owned corporations in their
Secretary and eventually referred to the Panel of involvement in mining enterprises, violates paragraph 4,
Arbitrators of the Mines and Geosciences Bureau (MGB), section 2, Article XII of the Constitution.
Regional Office No. 02, Tuguegarao, Cagayan, for further
action. V

On 12 November 2002, counsels for petitioners received a WHETHER OR NOT THE 1987 CONSTITUTION
letter from the Panel of Arbitrators of the MGB requiring PROHIBITS SERVICE CONTRACTS.1
the petitioners to comply with the Rules of the Panel of
Arbitrators before the letter may be acted upon. Before going to the substantive issues, the procedural
question raised by public respondents shall first be dealt
Yet again, counsels for petitioners sent President Arroyo with. Public respondents are of the view that petitioners
another demand letter dated 8 November 2002. Said letter eminent domain claim is not ripe for adjudication as they
was again forwarded to the DENR Secretary who referred fail to allege that CAMC has actually taken their properties
the same to the MGB, Quezon City. nor do they allege that their property rights have been
endangered or are in danger on account of CAMCs FTAA.
In a letter dated 19 February 2003, the MGB rejected the In effect, public respondents insist that the issue of
demand of counsels for petitioners for the cancellation of eminent domain is not a justiciable controversy which this
the CAMC FTAA.1avvphil.net Court can take cognizance of.

Petitioners thus filed the present petition for prohibition A justiciable controversy is defined as a definite and
and mandamus, with a prayer for a temporary restraining concrete dispute touching on the legal relations of parties
order. They pray that the Court issue an order: having adverse legal interests which may be resolved by a
court of law through the application of a law.2 Thus, courts
1. enjoining public respondents from acting on any have no judicial power to review cases involving political
application for FTAA; questions and as a rule, will desist from taking cognizance
of speculative or hypothetical cases, advisory opinions and
2. declaring unconstitutional the Philippine Mining Act of cases that have become moot.3 The Constitution is quite
1995 and its Implementing Rules and Regulations; explicit on this matter.4 It provides that judicial power
includes the duty of the courts of justice to settle actual
3. canceling the FTAA issued to CAMC. controversies involving rights which are legally
demandable and enforceable. Pursuant to this
In their memorandum petitioners pose the following constitutional mandate, courts, through the power of
issues: judicial review, are to entertain only real disputes between
conflicting parties through the application of law. For the
I courts to exercise the power of judicial review, the
following must be extant (1) there must be an actual case
Whether or not Republic Act No. 7942 and the CAMC calling for the exercise of judicial power; (2) the question
FTAA are void because they allow the unjust and unlawful must be ripe for adjudication; and (3) the person
taking of property without payment of just compensation , challenging must have the "standing."5
in violation of Section 9, Article III of the Constitution.
Law on NatRes (73-83 3

An actual case or controversy involves a conflict of legal the mining activities of CAMC. Likewise, they are under
rights, an assertion of opposite legal claims, susceptible of imminent threat of being displaced from their landholdings
judicial resolution as distinguished from a hypothetical or as a result of the implementation of the questioned FTAA.
abstract difference or dispute.6 There must be a They thus meet the appropriate case requirement as they
contrariety of legal rights that can be interpreted and assert an interest adverse to that of respondents who, on
enforced on the basis of existing law and jurisprudence. the other hand, claim the validity of the assailed statute
and the FTAA of CAMC.
Closely related to the second requisite is that the question
must be ripe for adjudication. A question is considered ripe Besides, the transcendental importance of the issues
for adjudication when the act being challenged has had a raised and the magnitude of the public interest involved
direct adverse effect on the individual challenging it.7 will have a bearing on the countrys economy which is to a
greater extent dependent upon the mining industry. Also
The third requisite is legal standing or locus standi. It is affected by the resolution of this case are the proprietary
defined as a personal or substantial interest in the case rights of numerous residents in the mining contract areas
such that the party has sustained or will sustain direct as well as the social existence of indigenous peoples
injury as a result of the governmental act that is being which are threatened. Based on these considerations, this
challenged, alleging more than a generalized grievance.8 Court deems it proper to take cognizance of the instant
The gist of the question of standing is whether a party petition.
alleges "such personal stake in the outcome of the
controversy as to assure that concrete adverseness which Having resolved the procedural question, the
sharpens the presentation of issues upon which the court constitutionality of the law under attack must be addressed
depends for illumination of difficult constitutional squarely.
questions."9 Unless a person is injuriously affected in any
of his constitutional rights by the operation of statute or First Substantive Issue: Validity of Section 76 of Rep. Act
ordinance, he has no standing. No. 7942 and DAO 96-40

In the instant case, there exists a live controversy involving In seeking to nullify Rep. Act No. 7942 and its
a clash of legal rights as Rep. Act No. 7942 has been implementing rules DAO 96-40 as unconstitutional,
enacted, DAO 96-40 has been approved and an FTAAs petitioners set their sight on Section 76 of Rep. Act No.
have been entered into. The FTAA holders have already 7942 and Section 107 of DAO 96-40 which they claim
been operating in various provinces of the country. Among allow the unlawful and unjust "taking" of private property
them is CAMC which operates in the provinces of Nueva for private purpose in contradiction with Section 9, Article
Vizcaya and Quirino where numerous individuals including III of the 1987 Constitution mandating that private property
the petitioners are imperiled of being ousted from their shall not be taken except for public use and the
landholdings in view of the CAMC FTAA. In light of this, corresponding payment of just compensation. They assert
the court cannot await the adverse consequences of the that public respondent DENR, through the Mining Act and
law in order to consider the controversy actual and ripe for its Implementing Rules and Regulations, cannot, on its
judicial intervention. Actual eviction of the land owners and own, permit entry into a private property and allow taking
occupants need not happen for this Court to intervene. As of land without payment of just compensation.
held in Pimentel, Jr. v. Hon. Aguirre:
Interpreting Section 76 of Rep. Act No. 7942 and Section
By the mere enactment of the questioned law or the 107 of DAO 96-40, juxtaposed with the concept of taking
approval of the challenged act, the dispute is said to have of property for purposes of eminent domain in the case of
ripened into a judicial controversy even without any other Republic v. Vda. de Castellvi,15 petitioners assert that
overt act. Indeed, even a singular violation of the there is indeed a "taking" upon entry into private lands and
Constitution and/or the law is enough to awaken judicial concession areas.
duty.
Republic v. Vda. de Castellvi defines "taking" under the
Petitioners embrace various segments of the society. concept of eminent domain as entering upon private
These include Didipio Earth-Savers Multi-Purpose property for more than a momentary period, and, under
Association, Inc., an organization of farmers and the warrant or color of legal authority, devoting it to a
indigenous peoples organized under Philippine laws, public use, or otherwise informally appropriating or
representing a community actually affected by the mining injuriously affecting it in such a way as to substantially oust
activities of CAMC, as well as other residents of areas the owner and deprive him of all beneficial enjoyment
affected by the mining activities of CAMC. These thereof.
petitioners have the standing to raise the constitutionality
of the questioned FTAA as they allege a personal and From the criteria set forth in the cited case, petitioners
substantial injury.14 They assert that they are affected by claim that the entry into a private property by CAMC,
Law on NatRes (73-83 4

pursuant to its FTAA, is for more than a momentary


period, i.e., for 25 years, and renewable for another 25 Public respondents are inclined to believe that by entering
years; that the entry into the property is under the warrant private lands and concession areas, FTAA holders do not
or color of legal authority pursuant to the FTAA executed oust the owners thereof nor deprive them of all beneficial
between the government and CAMC; and that the entry enjoyment of their properties as the said entry merely
substantially ousts the owner or possessor and deprives establishes a legal easement upon surface owners,
him of all beneficial enjoyment of the property. These occupants and concessionaires of a mining contract area.
facts, according to the petitioners, amount to taking. As
such, petitioners question the exercise of the power of Taking in Eminent Domain Distinguished from Regulation
eminent domain as unwarranted because respondents in Police Power
failed to prove that the entry into private property is
devoted for public use. The power of eminent domain is the inherent right of the
state (and of those entities to which the power has been
Petitioners also stress that even without the doctrine in the lawfully delegated) to condemn private property to public
Castellvi case, the nature of the mining activity, the extent use upon payment of just compensation.17 On the other
of the land area covered by the CAMC FTAA and the hand, police power is the power of the state to promote
various rights granted to the proponent or the FTAA public welfare by restraining and regulating the use of
holder, such as (a) the right of possession of the liberty and property.18 Although both police power and the
Exploration Contract Area, with full right of ingress and power of eminent domain have the general welfare for
egress and the right to occupy the same; (b) the right not their object, and recent trends show a mingling19 of the
to be prevented from entry into private lands by surface two with the latter being used as an implement of the
owners and/or occupants thereof when prospecting, former, there are still traditional distinctions between the
exploring and exploiting for minerals therein; (c) the right two.
to enjoy easement rights, the use of timber, water and
other natural resources in the Exploration Contract Area; Property condemned under police power is usually
(d) the right of possession of the Mining Area, with full right noxious or intended for a noxious purpose; hence, no
of ingress and egress and the right to occupy the same; compensation shall be paid.20 Likewise, in the exercise of
and (e) the right to enjoy easement rights, water and other police power, property rights of private individuals are
natural resources in the Mining Area, result in a taking of subjected to restraints and burdens in order to secure the
private property. general comfort, health, and prosperity of the state. Thus,
an ordinance prohibiting theaters from selling tickets in
Petitioners quickly add that even assuming arguendo that excess of their seating capacity (which would result in the
there is no absolute, physical taking, at the very least, diminution of profits of the theater-owners) was upheld
Section 76 establishes a legal easement upon the surface valid as this would promote the comfort, convenience and
owners, occupants and concessionaires of a mining safety of the customers.21 In U.S. v. Toribio,22 the court
contract area sufficient to deprive them of enjoyment and upheld the provisions of Act No. 1147, a statute regulating
use of the property and that such burden imposed by the the slaughter of carabao for the purpose of conserving an
legal easement falls within the purview of eminent domain. adequate supply of draft animals, as a valid exercise of
police power, notwithstanding the property rights
To further bolster their claim that the legal easement impairment that the ordinance imposed on cattle owners.
established is equivalent to taking, petitioners cite the case A zoning ordinance prohibiting the operation of a lumber
of National Power Corporation v. Gutierrez16 holding that yard within certain areas was assailed as unconstitutional
the easement of right-of-way imposed against the use of in that it was an invasion of the property rights of the
the land for an indefinite period is a taking under the power lumber yard owners in People v. de Guzman.23 The Court
of eminent domain. nonetheless ruled that the regulation was a valid exercise
of police power. A similar ruling was arrived at in Seng
Traversing petitioners assertion, public respondents argue Kee S Co. v. Earnshaw and Piatt24 where an ordinance
that Section 76 is not a taking provision but a valid divided the City of Manila into industrial and residential
exercise of the police power and by virtue of which, the areas.
state may prescribe regulations to promote the health,
morals, peace, education, good order, safety and general A thorough scrutiny of the extant jurisprudence leads to a
welfare of the people. This government regulation involves cogent deduction that where a property interest is merely
the adjustment of rights for the public good and that this restricted because the continued use thereof would be
adjustment curtails some potential for the use or economic injurious to public welfare, or where property is destroyed
exploitation of private property. Public respondents because its continued existence would be injurious to
concluded that "to require compensation in all such public interest, there is no compensable taking.25
circumstances would compel the government to regulate However, when a property interest is appropriated and
by purchase."
Law on NatRes (73-83 5

applied to some public purpose, there is compensable City of Manila,34 it was held that the imposition of burden
taking.26 over a private property through easement was considered
taking; hence, payment of just compensation is required.
According to noted constitutionalist, Fr. Joaquin Bernas, The Court declared:
SJ, in the exercise of its police power regulation, the state
restricts the use of private property, but none of the And, considering that the easement intended to be
property interests in the bundle of rights which constitute established, whatever may be the object thereof, is not
ownership is appropriated for use by or for the benefit of merely a real right that will encumber the property, but is
the public.27 Use of the property by the owner was limited, one tending to prevent the exclusive use of one portion of
but no aspect of the property is used by or for the the same, by expropriating it for public use which, be it
public.28 The deprivation of use can in fact be total and it what it may, can not be accomplished unless the owner of
will not constitute compensable taking if nobody else the property condemned or seized be previously and duly
acquires use of the property or any interest therein.29 indemnified, it is proper to protect the appellant by means
of the remedy employed in such cases, as it is only
If, however, in the regulation of the use of the property, adequate remedy when no other legal action can be
somebody else acquires the use or interest thereof, such resorted to, against an intent which is nothing short of an
restriction constitutes compensable taking. Thus, in City arbitrary restriction imposed by the city by virtue of the
Government of Quezon City v. Ericta,30 it was argued by coercive power with which the same is invested.
the local government that an ordinance requiring private
cemeteries to reserve 6% of their total areas for the burial And in the case of National Power Corporation v.
of paupers was a valid exercise of the police power under Gutierrez,35 despite the NPCs protestation that the
the general welfare clause. This court did not agree in the owners were not totally deprived of the use of the land and
contention, ruling that property taken under the police could still plant the same crops as long as they did not
power is sought to be destroyed and not, as in this case, come into contact with the wires, the Court nevertheless
to be devoted to a public use. It further declared that the held that the easement of right-of-way was a taking under
ordinance in question was actually a taking of private the power of eminent domain. The Court said:
property without just compensation of a certain area from
a private cemetery to benefit paupers who are charges of In the case at bar, the easement of right-of-way is
the local government. Being an exercise of eminent definitely a taking under the power of eminent domain.
domain without provision for the payment of just Considering the nature and effect of the installation of 230
compensation, the same was rendered invalid as it KV Mexico-Limay transmission lines, the limitation
violated the principles governing eminent domain. imposed by NPC against the use of the land for an
indefinite period deprives private respondents of its
In People v. Fajardo,31 the municipal mayor refused ordinary use.
Fajardo permission to build a house on his own land on
the ground that the proposed structure would destroy the A case exemplifying an instance of compensable taking
view or beauty of the public plaza. The ordinance relied which does not entail transfer of title is Republic v.
upon by the mayor prohibited the construction of any Philippine Long Distance Telephone Co.36 Here, the
building that would destroy the view of the plaza from the Bureau of Telecommunications, a government
highway. The court ruled that the municipal ordinance instrumentality, had contracted with the PLDT for the
under the guise of police power permanently divest interconnection between the Government Telephone
owners of the beneficial use of their property for the System and that of the PLDT, so that the former could
benefit of the public; hence, considered as a taking under make use of the lines and facilities of the PLDT. In its
the power of eminent domain that could not be desire to expand services to government offices, the
countenanced without payment of just compensation to Bureau of Telecommunications demanded to expand its
the affected owners. In this case, what the municipality use of the PLDT lines. Disagreement ensued on the terms
wanted was to impose an easement on the property in of the contract for the use of the PLDT facilities. The Court
order to preserve the view or beauty of the public plaza, ruminated:
which was a form of utilization of Fajardos property for
public benefit.32 Normally, of course, the power of eminent domain results
in the taking or appropriation of title to, and possession of,
While the power of eminent domain often results in the the expropriated property; but no cogent reason appears
appropriation of title to or possession of property, it need why said power may not be availed of to impose only a
not always be the case. Taking may include trespass burden upon the owner of the condemned property,
without actual eviction of the owner, material impairment of without loss of title and possession. It is unquestionable
the value of the property or prevention of the ordinary uses that real property may, through expropriation, be subjected
for which the property was intended such as the to an easement right of way.37
establishment of an easement.33 In Ayala de Roxas v.
Law on NatRes (73-83 6

In Republic v. Castellvi,38 this Court had the occasion to The entry referred to in Section 76 is not just a simple
spell out the requisites of taking in eminent domain, to wit: right-of-way which is ordinarily allowed under the
provisions of the Civil Code. Here, the holders of mining
(1) the expropriator must enter a private property; rights enter private lands for purposes of conducting
mining activities such as exploration, extraction and
(2) the entry must be for more than a momentary period. processing of minerals. Mining right holders build mine
infrastructure, dig mine shafts and connecting tunnels,
(3) the entry must be under warrant or color of legal prepare tailing ponds, storage areas and vehicle depots,
authority; install their machinery, equipment and sewer systems. On
top of this, under Section 75, easement rights are
(4) the property must be devoted to public use or accorded to them where they may build warehouses, port
otherwise informally appropriated or injuriously affected; facilities, electric transmission, railroads and other
infrastructures necessary for mining operations. All these
(5) the utilization of the property for public use must be in will definitely oust the owners or occupants of the affected
such a way as to oust the owner and deprive him of areas the beneficial ownership of their lands. Without a
beneficial enjoyment of the property. doubt, taking occurs once mining operations commence.

As shown by the foregoing jurisprudence, a regulation Section 76 of Rep. Act No. 7942 is a Taking Provision
which substantially deprives the owner of his proprietary
rights and restricts the beneficial use and enjoyment for Moreover, it would not be amiss to revisit the history of
public use amounts to compensable taking. In the case mining laws of this country which would help us
under consideration, the entry referred to in Section 76 understand Section 76 of Rep. Act No. 7942.
and the easement rights under Section 75 of Rep. Act No.
7942 as well as the various rights to CAMC under its This provision is first found in Section 27 of
FTAA are no different from the deprivation of proprietary Commonwealth Act No. 137 which took effect on 7
rights in the cases discussed which this Court considered November 1936, viz:
as taking. Section 75 of the law in question reads:
Before entering private lands the prospector shall first
Easement Rights. - When mining areas are so situated apply in writing for written permission of the private owner,
that for purposes of more convenient mining operations it claimant, or holder thereof, and in case of refusal by such
is necessary to build, construct or install on the mining private owner, claimant, or holder to grant such
areas or lands owned, occupied or leased by other permission, or in case of disagreement as to the amount of
persons, such infrastructure as roads, railroads, mills, compensation to be paid for such privilege of prospecting
waste dump sites, tailing ponds, warehouses, staging or therein, the amount of such compensation shall be fixed
storage areas and port facilities, tramways, runways, by agreement among the prospector, the Director of the
airports, electric transmission, telephone or telegraph Bureau of Mines and the surface owner, and in case of
lines, dams and their normal flood and catchment areas, their failure to unanimously agree as to the amount of
sites for water wells, ditches, canals, new river beds, compensation, all questions at issue shall be determined
pipelines, flumes, cuts, shafts, tunnels, or mills, the by the Court of First Instance.
contractor, upon payment of just compensation, shall be
entitled to enter and occupy said mining areas or lands. Similarly, the pertinent provision of Presidential Decree
No. 463, otherwise known as "The Mineral Resources
Section 76 provides: Development Decree of 1974," provides:

Entry into private lands and concession areas Subject to SECTION 12. Entry to Public and Private Lands. A
prior notification, holders of mining rights shall not be person who desires to conduct prospecting or other mining
prevented from entry into private lands and concession operations within public lands covered by concessions or
areas by surface owners, occupants, or concessionaires rights other than mining shall first obtain the written
when conducting mining operations therein. permission of the government official concerned before
entering such lands. In the case of private lands, the
The CAMC FTAA grants in favor of CAMC the right of written permission of the owner or possessor of the land
possession of the Exploration Contract Area, the full right must be obtained before entering such lands. In either
of ingress and egress and the right to occupy the same. It case, if said permission is denied, the Director, at the
also bestows CAMC the right not to be prevented from request of the interested person may intercede with the
entry into private lands by surface owners or occupants owner or possessor of the land. If the intercession fails,
thereof when prospecting, exploring and exploiting the interested person may bring suit in the Court of First
minerals therein. Instance of the province where the land is situated. If the
court finds the request justified, it shall issue an order
Law on NatRes (73-83 7

granting the permission after fixing the amount of existing ones on the subject, it is but reasonable to
compensation and/or rental due the owner or possessor: conclude that in passing a statute it was not intended to
Provided, That pending final adjudication of such amount, interfere with or abrogate any former law relating to the
the court shall upon recommendation of the Director same matter, unless the repugnancy between the two is
permit the interested person to enter, prospect and/or not only irreconcilable, but also clear and convincing, and
undertake other mining operations on the disputed land flowing necessarily from the language used, unless the
upon posting by such interested person of a bond with the later act fully embraces the subject matter of the earlier, or
court which the latter shall consider adequate to answer unless the reason for the earlier act is beyond
for any damage to the owner or possessor of the land peradventure removed.41 Hence, every effort must be
resulting from such entry, prospecting or any other mining used to make all acts stand and if, by any reasonable
operations. construction, they can be reconciled, the latter act will not
operate as a repeal of the earlier.
Hampered by the difficulties and delays in securing
surface rights for the entry into private lands for purposes Considering that Section 1 of Presidential Decree No. 512
of mining operations, Presidential Decree No. 512 dated granted the qualified mining operators the authority to
19 July 1974 was passed into law in order to achieve full exercise eminent domain and since this grant of authority
and accelerated mineral resources development. Thus, is deemed incorporated in Section 76 of Rep. Act No.
Presidential Decree No. 512 provides for a new system of 7942, the inescapable conclusion is that the latter
surface rights acquisition by mining prospectors and provision is a taking provision.
claimants. Whereas in Commonwealth Act No. 137 and
Presidential Decree No. 463 eminent domain may only be While this Court declares that the assailed provision is a
exercised in order that the mining claimants can build, taking provision, this does not mean that it is
construct or install roads, railroads, mills, warehouses and unconstitutional on the ground that it allows taking of
other facilities, this time, the power of eminent domain may private property without the determination of public use
now be invoked by mining operators for the entry, and the payment of just compensation.
acquisition and use of private lands, viz:
The taking to be valid must be for public use.42 Public use
SECTION 1. Mineral prospecting, location, exploration, as a requirement for the valid exercise of the power of
development and exploitation is hereby declared of public eminent domain is now synonymous with public interest,
use and benefit, and for which the power of eminent public benefit, public welfare and public convenience.43 It
domain may be invoked and exercised for the entry, includes the broader notion of indirect public benefit or
acquisition and use of private lands. x x x. advantage. Public use as traditionally understood as
"actual use by the public" has already been abandoned.44
The evolution of mining laws gives positive indication that
mining operators who are qualified to own lands were Mining industry plays a pivotal role in the economic
granted the authority to exercise eminent domain for the development of the country and is a vital tool in the
entry, acquisition, and use of private lands in areas open governments thrust of accelerated recovery.45 The
for mining operations. This grant of authority extant in importance of the mining industry for national development
Section 1 of Presidential Decree No. 512 is not expressly is expressed in Presidential Decree No. 463:
repealed by Section 76 of Rep. Act No. 7942; and neither
are the former statutes impliedly repealed by the former. WHEREAS, mineral production is a major support of the
These two provisions can stand together even if Section national economy, and therefore the intensified discovery,
76 of Rep. Act No. 7942 does not spell out the grant of the exploration, development and wise utilization of the
privilege to exercise eminent domain which was present in countrys mineral resources are urgently needed for
the old law. national development.

It is an established rule in statutory construction that in Irrefragably, mining is an industry which is of public
order that one law may operate to repeal another law, the benefit.
two laws must be inconsistent.39 The former must be so
repugnant as to be irreconciliable with the latter act. That public use is negated by the fact that the state would
Simply because a latter enactment may relate to the same be taking private properties for the benefit of private
subject matter as that of an earlier statute is not of itself mining firms or mining contractors is not at all true. In
sufficient to cause an implied repeal of the latter, since the Heirs of Juancho Ardona v. Reyes,46 petitioners therein
new law may be cumulative or a continuation of the old contended that the promotion of tourism is not for public
one. As has been the ruled, repeals by implication are not use because private concessionaires would be allowed to
favored, and will not be decreed unless it is manifest that maintain various facilities such as restaurants, hotels,
the legislature so intended.40 As laws are presumed to be stores, etc., inside the tourist area. The Court thus
passed with deliberation and with full knowledge of all contemplated:
Law on NatRes (73-83 8

Clearly, petitioners have needlessly jumped to


The rule in Berman v. Parker [348 U.S. 25; 99 L. ed. 27] of unwarranted conclusions, without being aware of the
deference to legislative policy even if such policy might rationale for the said provision. That provision does not
mean taking from one private person and conferring on call for the exercise of the power of eminent domain -- and
another private person applies as well in the Philippines. determination of just compensation is not an issue -- as
much as it calls for a qualified party to acquire the surface
". . . Once the object is within the authority of Congress, rights on behalf of a foreign-owned contractor.
the means by which it will be attained is also for Congress
to determine. Here one of the means chosen is the use of Rather than having the foreign contractor act through a
private enterprise for redevelopment of the area. dummy corporation, having the State do the purchasing is
Appellants argue that this makes the project a taking from a better alternative. This will at least cause the
one businessman for the benefit of another businessman. government to be aware of such transaction/s and foster
But the means of executing the project are for Congress transparency in the contractors dealings with the local
and Congress alone to determine, once the public purpose property owners. The government, then, will not act as a
has been established. x x x"47 subcontractor of the contractor; rather, it will facilitate the
transaction and enable the parties to avoid a technical
Petitioners further maintain that the states discretion to violation of the Anti-Dummy Law.
decide when to take private property is reduced
contractually by Section 13.5 of the CAMC FTAA, which There is also no basis for the claim that the Mining Law
reads: and its implementing rules and regulations do not provide
for just compensation in expropriating private properties.
If the CONTRACTOR so requests at its option, the Section 76 of Rep. Act No. 7942 and Section 107 of DAO
GOVERNMENT shall use its offices and legal powers to 96-40 provide for the payment of just compensation:
assist in the acquisition at reasonable cost of any surface
areas or rights required by the CONTRACTOR at the Section 76. xxx Provided, that any damage to the property
CONTRACTORs cost to carry out the Mineral Exploration of the surface owner, occupant, or concessionaire as a
and the Mining Operations herein. consequence of such operations shall be properly
compensated as may be provided for in the implementing
All obligations, payments and expenses arising from, or rules and regulations.
incident to, such agreements or acquisition of right shall be
for the account of the CONTRACTOR and shall be Section 107. Compensation of the Surface Owner and
recoverable as Operating Expense. Occupant- Any damage done to the property of the
surface owners, occupant, or concessionaire thereof as a
According to petitioners, the government is reduced to a consequence of the mining operations or as a result of the
sub-contractor upon the request of the private respondent, construction or installation of the infrastructure mentioned
and on account of the foregoing provision, the contractor in 104 above shall be properly and justly compensated.
can compel the government to exercise its power of
eminent domain thereby derogating the latters power to Such compensation shall be based on the agreement
expropriate property. entered into between the holder of mining rights and the
surface owner, occupant or concessionaire thereof, where
The provision of the FTAA in question lays down the ways appropriate, in accordance with P.D. No. 512. (Emphasis
and means by which the foreign-owned contractor, supplied.)
disqualified to own land, identifies to the government the
specific surface areas within the FTAA contract area to be Second Substantive Issue: Power of Courts to Determine
acquired for the mine infrastructure.48 The government Just Compensation
then acquires ownership of the surface land areas on
behalf of the contractor, through a voluntary transaction in Closely-knit to the issue of taking is the determination of
order to enable the latter to proceed to fully implement the just compensation. It is contended that Rep. Act No. 7942
FTAA. Eminent domain is not yet called for at this stage and Section 107 of DAO 96-40 encroach on the power of
since there are still various avenues by which surface the trial courts to determine just compensation in eminent
rights can be acquired other than expropriation. The FTAA domain cases inasmuch as the same determination of
provision under attack merely facilitates the proper compensation are cognizable only by the Panel of
implementation of the FTAA given to CAMC and shields it Arbitrators.
from violating the Anti-Dummy Law. Hence, when
confronted with the same question in La Bugal-BLaan The question on the judicial determination of just
Tribal Association, Inc. v. Ramos,49 the Court answered: compensation has been settled in the case of Export
Processing Zone Authority v. Dulay50 wherein the court
declared that the determination of just compensation in
Law on NatRes (73-83 9

eminent domain cases is a judicial function. Even as the compensation in expropriation proceedings involving
executive department or the legislature may make the mining operations. Although Section 105 confers upon the
initial determinations, the same cannot prevail over the Panel of Arbitrators the authority to decide cases where
courts findings. surface owners, occupants, concessionaires refuse permit
holders entry, thus, necessitating involuntary taking, this
Implementing Section 76 of Rep. Act No. 7942, Section does not mean that the determination of the just
105 of DAO 96-40 states that holder(s) of mining right(s) compensation by the Panel of Arbitrators or the Mines
shall not be prevented from entry into its/their Adjudication Board is final and conclusive. The
contract/mining areas for the purpose of exploration, determination is only preliminary unless accepted by all
development, and/or utilization. That in cases where parties concerned. There is nothing wrong with the grant
surface owners of the lands, occupants or concessionaires of primary jurisdiction by the Panel of Arbitrators or the
refuse to allow the permit holder or contractor entry, the Mines Adjudication Board to determine in a preliminary
latter shall bring the matter before the Panel of Arbitrators matter the reasonable compensation due the affected
for proper disposition. Section 106 states that voluntary landowners or occupants.52 The original and exclusive
agreements between the two parties permitting the mining jurisdiction of the courts to decide determination of just
right holders to enter and use the surface owners lands compensation remains intact despite the preliminary
shall be registered with the Regional Office of the MGB. In determination made by the administrative agency. As held
connection with Section 106, Section 107 provides that the in Philippine Veterans Bank v. Court of Appeals53:
compensation for the damage done to the surface owner,
occupant or concessionaire as a consequence of mining The jurisdiction of the Regional Trial Courts is not any less
operations or as a result of the construction or installation "original and exclusive" because the question is first
of the infrastructure shall be properly and justly passed upon by the DAR, as the judicial proceedings are
compensated and that such compensation shall be based not a continuation of the administrative determination.
on the agreement between the holder of mining rights and
surface owner, occupant or concessionaire, or where Third Substantive Issue: Sufficient Control by the State
appropriate, in accordance with Presidential Decree No. Over Mining Operations
512. In cases where there is disagreement to the
compensation or where there is no agreement, the matter Anent the third issue, petitioners charge that Rep. Act No.
shall be brought before the Panel of Arbitrators. Section 7942, as well as its Implementing Rules and Regulations,
206 of the implementing rules and regulations provides an makes it possible for FTAA contracts to cede over to a
aggrieved party the remedy to appeal the decision of the fully foreign-owned corporation full control and
Panel of Arbitrators to the Mines Adjudication Board, and management of mining enterprises, with the result that the
the latters decision may be reviewed by the Supreme State is allegedly reduced to a passive regulator
Court by filing a petition for review on certiorari.51 dependent on submitted plans and reports, with weak
review and audit powers. The State is not acting as the
An examination of the foregoing provisions gives no supposed owner of the natural resources for and on behalf
indication that the courts are excluded from taking of the Filipino people; it practically has little effective say in
cognizance of expropriation cases under the mining law. the decisions made by the enterprise. In effect, petitioners
The disagreement referred to in Section 107 does not asserted that the law, the implementing regulations, and
involve the exercise of eminent domain, rather it the CAMC FTAA cede beneficial ownership of the mineral
contemplates of a situation wherein the permit holders are resources to the foreign contractor.
allowed by the surface owners entry into the latters lands
and disagreement ensues as regarding the proper It must be noted that this argument was already raised in
compensation for the allowed entry and use of the private La Bugal-BLaan Tribal Association, Inc. v. Ramos,54
lands. Noticeably, the provision points to a voluntary sale where the Court answered in the following manner:
or transaction, but not to an involuntary sale.
RA 7942 provides for the states control and supervision
The legislature, in enacting the mining act, is presumed to over mining operations. The following provisions thereof
have deliberated with full knowledge of all existing laws establish the mechanism of inspection and visitorial rights
and jurisprudence on the subject. Thus, it is but over mining operations and institute reportorial
reasonable to conclude that in passing such statute it was requirements in this manner:
in accord with the existing laws and jurisprudence on the
jurisdiction of courts in the determination of just 1. Sec. 8 which provides for the DENRs power of over-all
compensation and that it was not intended to interfere with supervision and periodic review for "the conservation,
or abrogate any former law relating to the same matter. management, development and proper use of the States
Indeed, there is nothing in the provisions of the assailed mineral resources";
law and its implementing rules and regulations that
exclude the courts from their jurisdiction to determine just
Law on NatRes (73-83 10

2. Sec. 9 which authorizes the Mines and Geosciences feasibility (Section 35-e, RA 7942; Section 60, DAO 96-
Bureau (MGB) under the DENR to exercise "direct charge 40).
in the administration and disposition of mineral resources",
and empowers the MGB to "monitor the compliance by the The contractor must comply with the provisions pertaining
contractor of the terms and conditions of the mineral to mine safety, health and environmental protection
agreements", "confiscate surety and performance bonds", (Chapter XI, RA 7942; Chapters XV and XVI, DAO 96-40).
and deputize whenever necessary any member or unit of
the Phil. National Police, barangay, duly registered non- For violation of any of its terms and conditions,
governmental organization (NGO) or any qualified person government may cancel an FTAA. (Chapter XVII, RA
to police mining activities; 7942; Chapter XXIV, DAO 96-40).

3. Sec. 66 which vests in the Regional Director "exclusive An FTAA contractor is obliged to open its books of
jurisdiction over safety inspections of all installations, accounts and records for 0inspection by the government
whether surface or underground", utilized in mining (Section 56-m, DAO 96-40).
operations.
An FTAA contractor has to dispose of the minerals and by-
4. Sec. 35, which incorporates into all FTAAs the following products at the highest market price and register with the
terms, conditions and warranties: MGB a copy of the sales agreement (Section 56-n, DAO
96-40).
"(g) Mining operations shall be conducted in accordance
with the provisions of the Act and its IRR. MGB is mandated to monitor the contractors compliance
with the terms and conditions of the FTAA; and to
"(h) Work programs and minimum expenditures deputize, when necessary, any member or unit of the
commitments. Philippine National Police, the barangay or a DENR-
accredited nongovernmental organization to police mining
xxxx activities (Section 7-d and -f, DAO 96-40).

"(k) Requiring proponent to effectively use appropriate An FTAA cannot be transferred or assigned without prior
anti-pollution technology and facilities to protect the approval by the President (Section 40, RA 7942; Section
environment and restore or rehabilitate mined-out areas. 66, DAO 96-40).

"(l) The contractors shall furnish the Government records A mining project under an FTAA cannot proceed to the
of geologic, accounting and other relevant data for its construction/development/utilization stage, unless its
mining operation, and that books of accounts and records Declaration of Mining Project Feasibility has been
shall be open for inspection by the government. x x x. approved by government (Section 24, RA 7942).

"(m) Requiring the proponent to dispose of the minerals at The Declaration of Mining Project Feasibility filed by the
the highest price and more advantageous terms and contractor cannot be approved without submission of the
conditions. following documents:

xxxx 1. Approved mining project feasibility study (Section 53-d,


DAO 96-40)
"(o) Such other terms and conditions consistent with the
Constitution and with this Act as the Secretary may deem 2. Approved three-year work program (Section 53-a-4,
to be for the best interest of the State and the welfare of DAO 96-40)
the Filipino people."
3. Environmental compliance certificate (Section 70, RA
The foregoing provisions of Section 35 of RA 7942 are 7942)
also reflected and implemented in Section 56 (g), (h), (l),
(m) and (n) of the Implementing Rules, DAO 96-40. 4. Approved environmental protection and enhancement
program (Section 69, RA 7942)
Moreover, RA 7942 and DAO 96-40 also provide various
stipulations confirming the governments control over 5. Approval by the Sangguniang
mining enterprises: Panlalawigan/Bayan/Barangay (Section 70, RA 7942;
Section 27, RA 7160)
The contractor is to relinquish to the government those
portions of the contract area not needed for mining 6. Free and prior informed consent by the indigenous
operations and not covered by any declaration of mining peoples concerned, including payment of royalties through
Law on NatRes (73-83 11

a Memorandum of Agreement (Section 16, RA 7942; accounting (Section 56-m); annual progress reports and
Section 59, RA 8371) final report of exploration activities (Section 56-2).

The FTAA contractor is obliged to assist in the Other programs required to be submitted by the
development of its mining community, promotion of the contractor, pursuant to DAO 96-40, are the following: a
general welfare of its inhabitants, and development of safety and health program (Section 144); an
science and mining technology (Section 57, RA 7942). environmental work program (Section 168); an annual
environmental protection and enhancement program
The FTAA contractor is obliged to submit reports (on (Section 171).
quarterly, semi-annual or annual basis as the case may
be; per Section 270, DAO 96-40), pertaining to the The foregoing gamut of requirements, regulations,
following: restrictions and limitations imposed upon the FTAA
contractor by the statute and regulations easily overturns
1. Exploration petitioners contention. The setup under RA 7942 and
DAO 96-40 hardly relegates the State to the role of a
2. Drilling "passive regulator" dependent on submitted plans and
reports. On the contrary, the government agencies
3. Mineral resources and reserves concerned are empowered to approve or disapprove --
hence, to influence, direct and change -- the various work
4. Energy consumption programs and the corresponding minimum expenditure
commitments for each of the exploration, development and
5. Production utilization phases of the mining enterprise.

6. Sales and marketing Once these plans and reports are approved, the contractor
is bound to comply with its commitments therein. Figures
7. Employment for mineral production and sales are regularly monitored
and subjected to government review, in order to ensure
8. Payment of taxes, royalties, fees and other Government that the products and by-products are disposed of at the
Shares best prices possible; even copies of sales agreements
have to be submitted to and registered with MGB. And the
9. Mine safety, health and environment contractor is mandated to open its books of accounts and
records for scrutiny, so as to enable the State to determine
10. Land use if the government share has been fully paid.

11. Social development The State may likewise compel the contractors
compliance with mandatory requirements on mine safety,
12. Explosives consumption health and environmental protection, and the use of anti-
pollution technology and facilities. Moreover, the
An FTAA pertaining to areas within government contractor is also obligated to assist in the development of
reservations cannot be granted without a written clearance the mining community and to pay royalties to the
from the government agencies concerned (Section 19, RA indigenous peoples concerned.
7942; Section 54, DAO 96-40).
Cancellation of the FTAA may be the penalty for violation
An FTAA contractor is required to post a financial of any of its terms and conditions and/or noncompliance
guarantee bond in favor of the government in an amount with statutes or regulations. This general, all-around,
equivalent to its expenditures obligations for any particular multipurpose sanction is no trifling matter, especially to a
year. This requirement is apart from the representations contractor who may have yet to recover the tens or
and warranties of the contractor that it has access to all hundreds of millions of dollars sunk into a mining project.
the financing, managerial and technical expertise and
technology necessary to carry out the objectives of the Overall, considering the provisions of the statute and the
FTAA (Section 35-b, -e, and -f, RA 7942). regulations just discussed, we believe that the State
definitely possesses the means by which it can have the
Other reports to be submitted by the contractor, as ultimate word in the operation of the enterprise, set
required under DAO 96-40, are as follows: an directions and objectives, and detect deviations and
environmental report on the rehabilitation of the mined-out noncompliance by the contractor; likewise, it has the
area and/or mine waste/tailing covered area, and anti- capability to enforce compliance and to impose sanctions,
pollution measures undertaken (Section 35-a-2); annual should the occasion therefor arise.
reports of the mining operations and records of geologic
Law on NatRes (73-83 12

In other words, the FTAA contractor is not free to do Petitioners claim that the phrase "agreements x x x
whatever it pleases and get away with it; on the contrary, it involving either technical or financial assistance" simply
will have to follow the government line if it wants to stay in means technical assistance or financial assistance
the enterprise. Ineluctably then, RA 7942 and DAO 96-40 agreements, nothing more and nothing else. They insist
vest in the government more than a sufficient degree of that there is no ambiguity in the phrase, and that a plain
control and supervision over the conduct of mining reading of paragraph 4 quoted above leads to the
operations. inescapable conclusion that what a foreign-owned
corporation may enter into with the government is merely
Fourth Substantive Issue: The Proper Interpretation of the an agreement for either financial or technical assistance
Constitutional Phrase "Agreements Involving Either only, for the large-scale exploration, development and
Technical or Financial Assistance utilization of minerals, petroleum and other mineral oils;
such a limitation, they argue, excludes foreign
In interpreting the first and fourth paragraphs of Section 2, management and operation of a mining enterprise.
Article XII of the Constitution, petitioners set forth the
argument that foreign corporations are barred from making This restrictive interpretation, petitioners believe, is in line
decisions on the conduct of operations and the with the general policy enunciated by the Constitution
management of the mining project. The first paragraph of reserving to Filipino citizens and corporations the use and
Section 2, Article XII reads: enjoyment of the countrys natural resources. They
maintain that this Courts Decision of January 27, 2004
x x x The exploration, development, and utilization of correctly declared the WMCP FTAA, along with pertinent
natural resources shall be under the full control and provisions of RA 7942, void for allowing a foreign
supervision of the State. The State may directly undertake contractor to have direct and exclusive management of a
such activities, or it may enter into co-production, joint mining enterprise. Allowing such a privilege not only runs
venture, or production sharing agreements with Filipino counter to the "full control and supervision" that the State
citizens, or corporations or associations at least sixty is constitutionally mandated to exercise over the
percentum of whose capital is owned by such citizens. exploration, development and utilization of the countrys
Such agreements may be for a period not exceeding natural resources; doing so also vests in the foreign
twenty five years, renewable for not more than twenty five company "beneficial ownership" of our mineral resources.
years, and under such terms and conditions as may be It will be recalled that the Decision of January 27, 2004
provided by law x x x. zeroed in on "management or other forms of assistance"
or other activities associated with the "service contracts" of
The fourth paragraph of Section 2, Article XII provides: the martial law regime, since "the management or
operation of mining activities by foreign contractors, which
The President may enter into agreements with foreign- is the primary feature of service contracts, was precisely
owned corporations involving either technical or financial the evil that the drafters of the 1987 Constitution sought to
assistance for large scale exploration, development, and eradicate."
utilization of minerals, petroleum, and other mineral oils
according to the general terms and conditions provided by xxxx
law, based on real contributions to the economic growth
and general welfare of the country x x x. We do not see how applying a strictly literal or verba legis
interpretation of paragraph 4 could inexorably lead to the
Petitioners maintain that the first paragraph bars aliens conclusions arrived at in the ponencia. First, the drafters
and foreign-owned corporations from entering into any choice of words -- their use of the phrase agreements x x x
direct arrangement with the government including those involving either technical or financial assistance -- does
which involve co-production, joint venture or production not indicate the intent to exclude other modes of
sharing agreements. They likewise insist that the fourth assistance. The drafters opted to use involving when they
paragraph allows foreign-owned corporations to participate could have simply said agreements for financial or
in the large-scale exploration, development and utilization technical assistance, if that was their intention to begin
of natural resources, but such participation, however, is with. In this case, the limitation would be very clear and no
merely limited to an agreement for either financial or further debate would ensue.
technical assistance only.
In contrast, the use of the word "involving" signifies the
Again, this issue has already been succinctly passed upon possibility of the inclusion of other forms of assistance or
by this Court in La Bugal-BLaan Tribal Association, Inc. v. activities having to do with, otherwise related to or
Ramos.55 In discrediting such argument, the Court compatible with financial or technical assistance. The word
ratiocinated: "involving" as used in this context has three connotations
that can be differentiated thus: one, the sense of
"concerning," "having to do with," or "affecting"; two,
Law on NatRes (73-83 13

"entailing," "requiring," "implying" or "necessitating"; and was not carried over to the present constitution, sans any
three, "including," "containing" or "comprising." categorical statement banning service contracts in mining
activities, does not mean that service contracts as
Plainly, none of the three connotations convey a sense of understood in the 1973 Constitution was eradicated in the
exclusivity. Moreover, the word "involving," when 1987 Constitution.56 The 1987 Constitution allows the
understood in the sense of "including," as in including continued use of service contracts with foreign
technical or financial assistance, necessarily implies that corporations as contractors who would invest in and
there are activities other than those that are being operate and manage extractive enterprises, subject to the
included. In other words, if an agreement includes full control and supervision of the State; this time,
technical or financial assistance, there is apart from such however, safety measures were put in place to prevent
assistance -- something else already in, and covered or abuses of the past regime.57 We ruled, thus:
may be covered by, the said agreement.
To our mind, however, such intent cannot be definitively
In short, it allows for the possibility that matters, other than and conclusively established from the mere failure to carry
those explicitly mentioned, could be made part of the the same expression or term over to the new Constitution,
agreement. Thus, we are now led to the conclusion that absent a more specific, explicit and unequivocal statement
the use of the word "involving" implies that these to that effect. What petitioners seek (a complete ban on
agreements with foreign corporations are not limited to foreign participation in the management of mining
mere financial or technical assistance. The difference in operations, as previously allowed by the earlier
sense becomes very apparent when we juxtapose Constitutions) is nothing short of bringing about a
"agreements for technical or financial assistance" against momentous sea change in the economic and
"agreements including technical or financial assistance." developmental policies; and the fundamentally capitalist,
This much is unalterably clear in a verba legis approach. free-enterprise philosophy of our government. We cannot
imagine such a radical shift being undertaken by our
Second, if the real intention of the drafters was to confine government, to the great prejudice of the mining sector in
foreign corporations to financial or technical assistance particular and our economy in general, merely on the basis
and nothing more, their language would have certainly of the omission of the terms service contract from or the
been so unmistakably restrictive and stringent as to leave failure to carry them over to the new Constitution. There
no doubt in anyones mind about their true intent. For has to be a much more definite and even unarguable basis
example, they would have used the sentence foreign for such a drastic reversal of policies.
corporations are absolutely prohibited from involvement in
the management or operation of mining or similar ventures xxxx
or words of similar import. A search for such stringent
wording yields negative results. Thus, we come to the The foregoing are mere fragments of the framers lengthy
inevitable conclusion that there was a conscious and discussions of the provision dealing with agreements x x x
deliberate decision to avoid the use of restrictive wording involving either technical or financial assistance, which
that bespeaks an intent not to use the expression ultimately became paragraph 4 of Section 2 of Article XII
"agreements x x x involving either technical or financial of the Constitution. Beyond any doubt, the members of the
assistance" in an exclusionary and limiting manner. ConCom were actually debating about the martial-law-era
service contracts for which they were crafting appropriate
Fifth Substantive Issue: Service Contracts Not safeguards.
Deconstitutionalized
In the voting that led to the approval of Article XII by the
Lastly, petitioners stress that the service contract regime ConCom, the explanations given by Commissioners
under the 1973 Constitution is expressly prohibited under Gascon, Garcia and Tadeo indicated that they had voted
the 1987 Constitution as the term service contracts found to reject this provision on account of their objections to the
in the former was deleted in the latter to avoid the "constitutionalization" of the "service contract" concept.
circumvention of constitutional prohibitions that were
prevalent in the 1987 Constitution. According to them, the Mr. Gascon said, "I felt that if we would constitutionalize
framers of the 1987 Constitution only intended for foreign- any provision on service contracts, this should always be
owned corporations to provide either technical assistance with the concurrence of Congress and not guided only by
or financial assistance. Upon perusal of the CAMC FTAA, a general law to be promulgated by Congress." Mr. Garcia
petitioners are of the opinion that the same is a replica of explained, "Service contracts are given constitutional
the service contract agreements that the present legitimization in Sec. 3, even when they have been proven
constitution allegedly prohibit. to be inimical to the interests of the nation, providing, as
they do, the legal loophole for the exploitation of our
Again, this contention is not well-taken. The mere fact that natural resources for the benefit of foreign interests."
the term service contracts found in the 1973 Constitution Likewise, Mr. Tadeo cited inter alia the fact that service
Law on NatRes (73-83 14

contracts continued to subsist, enabling foreign interests to Environment and Natural Resources (DENR),
benefit from our natural resources. It was hardly likely that PROVINCIAL MINING REGULATORY BOARD OF
these gentlemen would have objected so strenuously, had DAVAO (PMRB-Davao), respondents.; G.R. No. 135190
the provision called for mere technical or financial April 3, 2002
assistance and nothing more.
This is a petition for review of the March 19, 1998 decision
The deliberations of the ConCom and some of the Court of Appeals in CA-G.R. SP No. 44693,
commissioners explanation of their votes leave no room dismissing the special civil action for certiorari, prohibition
for doubt that the service contract concept precisely and mandamus, and the resolution dated August 19, 1998
underpinned the commissioners understanding of the denying petitioner's motion for reconsideration.
"agreements involving either technical or financial
assistance." The instant case involves a rich tract of mineral land
situated in the Agusan-Davao-Surigao Forest Reserve
xxxx known as the "Diwalwal Gold Rush Area." Located at Mt.
Diwata in the municipalities of Monkayo and Cateel in
From the foregoing, we are impelled to conclude that the Davao Del Norte, the land has been embroiled in
phrase agreements involving either technical or financial controversy since the mid-80's due to the scramble over
assistance, referred to in paragraph 4, are in fact service gold deposits found within its bowels.
contracts. But unlike those of the 1973 variety, the new
ones are between foreign corporations acting as From 1985 to 1991, thousands of people flocked to
contractors on the one hand; and on the other, the Diwalwal to stake their respective claims. Peace and order
government as principal or "owner" of the works. In the deteriorated rapidly, with hundreds of people perishing in
new service contracts, the foreign contractors provide mine accidents, man-made or otherwise, brought about by
capital, technology and technical know-how, and unregulated mining activities. The multifarious problems
managerial expertise in the creation and operation of spawned by the gold rush assumed gargantuan
large-scale mining/extractive enterprises; and the proportions, such that finding a "win-win" solution became
government, through its agencies (DENR, MGB), actively a veritable needle in a haystack.
exercises control and supervision over the entire
operation. On March 10, 1988, Marcopper Mining Corporation
(Marcopper) was granted Exploration Permit No. 133 (EP
xxxx No. 133) over 4,491 hectares of land, which included the
hotly-contested Diwalwal area.1 Marcopper's acquisition of
It is therefore reasonable and unavoidable to make the mining rights over Diwalwal under its EP No. 133 was
following conclusion, based on the above arguments. As subsequently challenged before this Court in "Apex Mining
written by the framers and ratified and adopted by the Co., Inc., et al. v. Hon. Cancio C. Garcia, et al.,"2 where
people, the Constitution allows the continued use of Marcopper's claim was sustained over that of another
service contracts with foreign corporations -- as mining firm, Apex Mining Corporation (Apex). The Court
contractors who would invest in and operate and manage found that Apex did not comply with the procedural
extractive enterprises, subject to the full control and requisites for acquiring mining rights within forest reserves.
supervision of the State -- sans the abuses of the past
regime. The purpose is clear: to develop and utilize our Not long thereafter, Congress enacted on June 27, 1991
mineral, petroleum and other resources on a large scale Republic Act No. 7076, or the People's Small-Scale Mining
for the immediate and tangible benefit of the Filipino Act. The law established a People's Small-Scale Mining
people.58 Program to be implemented by the Secretary of the
DENR3 and created the Provincial Mining Regulatory
WHEREFORE, the instant petition for prohibition and Board (PMRB) under the DENR Secretary's direct
mandamus is hereby DISMISSED. Section 76 of Republic supervision and control.4 The statute also authorized the
Act No. 7942 and Section 107 of DAO 96-40; Republic Act PMRB to declare and set aside small-scale mining areas
No. 7942 and its Implementing Rules and Regulations subject to review by the DENR Secretary5 and award
contained in DAO 96-40 insofar as they relate to mining contracts to small-scale miners under certain
financial and technical assistance agreements referred to conditions.6
in paragraph 4 of Section 2 of Article XII of the Constitution
are NOT UNCONSTITUTIONAL. SO ORDERED. On December 21, 1991, DENR Secretary Fulgencio S.
SOUTHEAST MINDANAO GOLD MINING Factoran issued Department Administrative Order (DAO)
CORPORATION, petitioner, vs. BALITE PORTAL No. 66, declaring 729 hectares of the Diwalwal area as
MINING COOPERATIVE and others similarly situated; non-forest land open to small-scale mining.7 The issuance
and THE HONORABLE ANTONIO CERILLES, in his was made pursuant to the powers vested in the DENR
capacity as Secretary of the Department of
Law on NatRes (73-83 15

Secretary by Proclamation No. 369, which established the


Agusan-Davao-Surigao Forest Reserve. On April 1, 1997, Provincial Mining Regulatory Board of
Davao passed Resolution No. 26, Series of 1997,
Subsequently, a petition for the cancellation of EP No. 133 authorizing the issuance of ore transport permits (OTPs) to
and the admission of a Mineral Production Sharing small-scale miners operating in the Diwalwal mines.
Arrangement (MPSA) proposal over Diwalwal was filed
before the DENR Regional Executive Director, docketed Thus, on May 30, 1997, petitioner filed a complaint for
as RED Mines Case No. 8-8-94 entitled, "Rosendo damages before the Regional Trial Court of Makati City,
Villaflor, et al. v. Marcopper Mining Corporation." Branch 61, against the DENR Secretary and PMRB-
Davao. SEM alleged that the illegal issuance of the OTPs
On February 16, 1994, while the RED Mines case was allowed the extraction and hauling of P60,000.00 worth of
pending, Marcopper assigned its EP No. 133 to petitioner gold ore per truckload from SEM's mining claim.
Southeast Mindanao Gold Mining Corporation (SEM),8
which in turn applied for an integrated MPSA over the land Meanwhile, on June 13, 1997, the RPA resolved the
covered by the permit. Consolidated Mines cases and decreed in an Omnibus
Resolution as follows:
In due time, the Mines and Geosciences Bureau Regional
Office No. XI in Davao City (MGB-XI) accepted and VIEWED IN THE LIGHT OF THE FOREGOING, the
registered the integrated MPSA application of petitioner. validity of Exploration Permit No. 133 is hereby reiterated
After publication of the application, the following filed their and all the adverse claims against MPSAA No. 128 are
oppositions: DISMISSED.9

a) MAC Case No. 004(XI) - JB Management Mining On June 24, 1997, the DENR Secretary issued
Corporation; Memorandum Order No. 97-0310 which provided, among
others, that:
b) MAC Case No. 005(XI) - Davao United Miners
Cooperative; 1. The DENR shall study thoroughly and exhaustively the
option of direct state utilization of the mineral resources in
c) MAC Case No. 006(XI) - Balite Integrated Small Scale the Diwalwal Gold-Rush Area. Such study shall include,
Miner's Cooperative; but shall not be limited to, studying and weighing the
feasibility of entering into management agreements or
d) MAC Case No. 007(XI) - Monkayo Integrated Small operating agreements, or both, with the appropriate
Scale Miner's Association, Inc.; government instrumentalities or private entities, or both, in
carrying out the declared policy of rationalizing the mining
e) MAC Case No. 008(XI) - Paper Industries Corporation operations in the Diwalwal Gold Rush Area; such
of the Philippines; agreements shall include provisions for profit-sharing
between the state and the said parties, including profit-
f) MAC Case No. 009(XI) - Rosendo Villaflor, et al.; sharing arrangements with small-scale miners, as well as
the payment of royalties to indigenous cultural
g) MAC Case No. 010(XI) - Antonio Dacudao; communities, among others. The Undersecretary for Field
Operations, as well as the Undersecretary for Legal and
h) MAC Case No. 011(XI) - Atty. Jose T. Amacio; Legislative Affairs and Attached Agencies, and the
Director of the Mines and Geo-sciences Bureau are
i) MAC Case No. 012(XI) - Puting-Bato Gold Miners hereby ordered to undertake such studies. x x x11
Cooperative;
On July 16, 1997, petitioner filed a special civil action for
j) MAC Case No. 016(XI) - Balite Communal Portal Mining certiorari, prohibition and mandamus before the Court of
Cooperative; and Appeals against PMRB-Davao, the DENR Secretary and
Balite Communal Portal Mining Cooperative (BCPMC),
k) MAC Case No. 97-01(XI) - Romeo Altamera, et al. which represented all the OTP grantees. It prayed for the
nullification of the above-quoted Memorandum Order No.
In the meantime, on March 3, 1995, Republic Act No. 97-03 on the ground that the "direct state utilization"
7942, the Philippine Mining Act, was enacted. Pursuant to espoused therein would effectively impair its vested rights
this statute, the above-enumerated MAC cases were under EP No. 133; that the DENR Secretary unduly
referred to a Regional Panel of Arbitrators (RPA) tasked to usurped and interfered with the jurisdiction of the RPA
resolve disputes involving conflicting mining rights. The which had dismissed all adverse claims against SEM in
RPA subsequently took cognizance of the RED Mines the Consolidated Mines cases; and that the memorandum
case, which was consolidated with the MAC cases. order arbitrarily imposed the unwarranted condition that
Law on NatRes (73-83 16

certain studies be conducted before mining and ON THE VALIDITY OF ORE TRANSPORT PERMIT
environmental laws are enforced by the DENR. (OTP) IS VESTED IN THE REGIONAL PANEL OF
ARBITRATORS.15
Meanwhile, on January 6, 1998, the MAB rendered a
decision in the Consolidated Mines cases, setting aside In a resolution dated September 11, 2000, the appealed
the judgment of the RPA.12 This MAB decision was then Consolidated Mines cases, docketed as G.R. Nos. 132475
elevated to this Court by way of a consolidated petition, and 132528, were referred to the Court of Appeals for
docketed as G.R. Nos. 132475 and 132528.1wphi1.nt proper disposition pursuant to Rule 43 of the 1997 Rules
of Civil Procedure.16 These cases, which were docketed
On March 19, 1998, the Court of Appeals, through a as CA-G.R. SP Nos. 61215 and 61216, are still pending
division of five members voting 3-2,13 dismissed the before the Court of Appeals.
petition in CA-G.R. SP No. 44693. It ruled that the DENR
Secretary did not abuse his discretion in issuing In the first assigned error, petitioner insists that the Court
Memorandum Order No. 97-03 since the same was merely of Appeals erred when it concluded that the assailed
a directive to conduct studies on the various options memorandum order did not adopt the "direct state
available to the government for solving the Diwalwal utilization scheme" in resolving the Diwalwal dispute. On
conflict. The assailed memorandum did not conclusively the contrary, petitioner submits, said memorandum order
adopt "direct state utilization" as official government policy dictated the said recourse and, in effect, granted
on the matter, but was simply a manifestation of the management or operating agreements as well as provided
DENR's intent to consider it as one of its options, after for profit sharing arrangements to illegal small-scale
determining its feasibility through studies. MO 97-03 was miners.
only the initial step in the ladder of administrative process
and did not, as yet, fix any obligation, legal relationship or According to petitioner, MO 97-03 was issued to preempt
right. It was thus premature for petitioner to claim that its the resolution of the Consolidated Mines cases. The
"constitutionally-protected rights" under EP No. 133 have "direct state utilization scheme" espoused in the
been encroached upon, much less, violated by its challenged memorandum is nothing but a legal shortcut,
issuance. designed to divest petitioner of its vested right to the gold
rush area under its EP No. 133.
Additionally, the appellate court pointed out that
petitioner's rights under EP No. 133 are not inviolable, We are not persuaded.
sacrosanct or immutable. Being in the nature of a privilege
granted by the State, the permit can be revoked, amended We agree with the Court of Appeals' ruling that the
or modified by the Chief Executive when the national challenged MO 97-03 did not conclusively adopt "direct
interest so requires. The Court of Appeals, however, state utilization" as a policy in resolving the Diwalwal
declined to rule on the validity of the OTPs, reasoning that dispute. The terms of the memorandum clearly indicate
said issue was within the exclusive jurisdiction of the RPA. that what was directed thereunder was merely a study of
this option and nothing else. Contrary to petitioner's
Petitioner filed a motion for reconsideration of the above contention, it did not grant any management/operating or
decision, which was denied for lack of merit on August 19, profit-sharing agreement to small-scale miners or to any
1998.14 party, for that matter, but simply instructed the DENR
officials concerned to undertake studies to determine its
Hence this petition, raising the following errors: feasibility. As the Court of Appeals extensively discussed
in its decision:
I. THE COURT OF APPEALS COMMITTED GRAVE AND
REVERSIBLE ERROR, AND HAS DECIDED A x x x under the Memorandum Order, the State still had to
QUESTION OF SUBSTANCE NOT THERETOFORE study prudently and exhaustively the various options
DETERMINED BY THIS HONORABLE SUPREME available to it in rationalizing the explosive and ever
COURT, OR HAS DECIDED IT IN A WAY PROBABLY perilous situation in the area, the debilitating adverse
NOT IN ACCORD WITH LAW OR WITH APPLICABLE effects of mining in the community and at the same time,
DECISIONS OF THIS HONORABLE COURT IN preserve and enhance the safety of the mining operations
UPHOLDING THE QUESTIONED ACTS OF and ensure revenues due to the government from the
RESPONDENT DENR SECRETARY WHICH ARE IN development of the mineral resources and the exploitation
VIOLATION OF MINING LAWS AND IN DEROGATION thereof. The government was still in earnest search of
OF PETITIONER'S VESTED RIGHTS OVER THE AREA better options that would be fair and just to all parties
COVERED BY ITS EP NO. 133; concerned, including, notably, the Petitioner. The direct
state utilization of the mineral resources in the area was
II. THE COURT OF APPEALS COMMITTED GRAVE AND only one of the options of the State. Indeed, it is too plain
REVERSIBLE ERROR IN HOLDING THAT AN ACTION to see, x x x that before the State will settle on an option, x
Law on NatRes (73-83 17

x x an extensive and intensive study of all the facets of a BCMC and the other oppositor mining firms, who were not
direct state exploitation was directed by the Public impleaded as parties therein.
Respondent DENR Secretary. And even if direct state
exploitation was opted by the government, the DENR still Neither can the Apex Mining case foreclose any question
had to promulgate rules and regulations to implement the pertaining to the continuing validity of EP No. 133 on
same x x x, in coordination with the other concerned grounds which arose after the judgment in said case was
agencies of the government.17 promulgated. While it is true that the Apex Mining case
settled the issue of who between Apex and Marcopper
Consequently, the petition was premature. The said validly acquired mining rights over the disputed area by
memorandum order did not impose any obligation on the availing of the proper procedural requisites mandated by
claimants or fix any legal relation whatsoever between and law, it certainly did not deal with the question raised by the
among the parties to the dispute. At this stage, petitioner oppositors in the Consolidated Mines cases, i.e. whether
can show no more than a mere apprehension that the EP No. 133 had already expired and remained valid
State, through the DENR, would directly take over the subsequent to its transfer by Marcopper to petitioner.
mines after studies point to its viability. But until the DENR Besides, as clarified in our decision in the Apex Mining
actually does so and petitioner's fears turn into reality, no case:
valid objection can be entertained against MO 97-03 on
grounds which are purely speculative and anticipatory.18 x x x is conclusive only between the parties with respect to
the particular issue herein raised and under the set of
With respect to the alleged "vested rights" claimed by circumstances herein prevailing. In no case should the
petitioner, it is well to note that the same is invariably decision be considered as a precedent to resolve or settle
based on EP No. 133, whose validity is still being disputed claims of persons/entities not parties hereto. Neither is it
in the Consolidated Mines cases. A reading of the intended to unsettle rights of persons/entities which have
appealed MAB decision reveals that the continued efficacy been acquired or which may have accrued upon reliance
of EP No. 133 is one of the issues raised in said cases, on laws passed by appropriate agencies.20
with respondents therein asserting that Marcopper cannot
legally assign the permit which purportedly had expired. In Clearly then, the Apex Mining case did not invest petitioner
other words, whether or not petitioner actually has a with any definite right to the Diwalwal mines which it could
vested right over Diwalwal under EP No. 133 is still an now set up against respondent BCMC and the other
indefinite and unsettled matter. And until a positive mining groups.
pronouncement is made by the appellate court in the
Consolidated Mines cases, EP No. 133 cannot be deemed Incidentally, it must likewise be pointed out that under no
as a source of any conclusive rights that can be impaired circumstances may petitioner's rights under EP No. 133 be
by the issuance of MO 97-03. regarded as total and absolute. As correctly held by the
Court of Appeals in its challenged decision, EP No. 133
Similarly, there is no merit in petitioner's assertion that MO merely evidences a privilege granted by the State, which
97-03 sanctions violation of mining laws by allowing illegal may be amended, modified or rescinded when the national
miners to enter into mining agreements with the State. interest so requires. This is necessarily so since the
Again, whether or not respondent BCMC and the other exploration, development and utilization of the country's
mining entities it represents are conducting illegal mining natural mineral resources are matters impressed with
activities is a factual matter that has yet to be finally great public interest. Like timber permits, mining
determined in the Consolidated Mines cases. We cannot exploration permits do not vest in the grantee any
rightfully conclude at this point that respondent BCMC and permanent or irrevocable right within the purview of the
the other mining firms are illegitimate mining operators. non-impairment of contract and due process clauses of the
Otherwise, we would be preempting the resolution of the Constitution,21 since the State, under its all-encompassing
cases which are still pending before the Court of police power, may alter, modify or amend the same, in
Appeals.19 accordance with the demands of the general welfare.22

Petitioner's reliance on the Apex Mining case to justify its Additionally, there can be no valid opposition raised
rights under E.P. No. 133 is misplaced. For one, the said against a mere study of an alternative which the State,
case was litigated solely between Marcopper and Apex through the DENR, is authorized to undertake in the first
Mining Corporation and cannot thus be deemed binding place. Worth noting is Article XII, Section 2, of the 1987
and conclusive on respondent BCMC and the other mining Constitution, which specifically provides:
entities presently involved. While petitioner may be
regarded as Marcopper's successor to EP No. 133 and SEC. 2. All lands of the public domain, waters, minerals,
therefore bound by the judgment rendered in the Apex coal, petroleum, and other mineral oils, all forces of
Mining case, the same cannot be said of respondent potential energy, fisheries, forests or timber, wildlife, flora
and fauna, and other natural resources are owned by the
Law on NatRes (73-83 18

State. With the exception of agricultural lands, all other respondent BCMC and the other mining firms are illegal
natural resources shall not be alienated. The exploration, miners. These factual issues are to be properly threshed
development, and utilization of natural resources shall be out in CA G.R. SP Nos. 61215 and 61216, which have yet
under the full control and supervision of the State. The to be decided by the Court of Appeals. Any objection
State may directly undertake such activities, or it may raised against MO 97-03 is likewise premature at this
enter into co-production, joint venture, or production- point, inasmuch as it merely ordered a study of an option
sharing agreements with Filipino citizens, or corporations which the State is authorized by law to undertake.
or associations at least sixty per centum of whose capital
is owned by such citizens. Such agreements may be for a We see no need to rule on the matter of the OTPs,
period not exceeding twenty-five years, renewable for not considering that the grounds invoked by petitioner for
more than twenty-five years, and under such terms and invalidating the same are inextricably linked to the issues
conditions as may be provided by law. In cases of water raised in the Consolidated Mines cases.
rights for irrigation, water supply, fisheries, or industrial
uses other than the development of water power, WHEREFORE, in view of the foregoing, the instant petition
beneficial use may be the measure and limit of the grant. is DENIED. The decision of the Court of Appeals in CA-
(Underscoring ours) G.R. SP No. 44693 is AFFIRMED. SO ORDERED.
STA. ROSA REALTY DEVELOPMENT CORPORATION,
Likewise, Section 4, Chapter II of the Philippine Mining Act petitioner, vs. COURT OF APPEALS, JUAN B.
of 1995 states: AMANTE, FRANCISCO L. ANDAL, LUCIA ANDAL,
ANDREA P. AYENDE, LETICIA P. BALAT, FILOMENA
SEC. 4. Ownership of Mineral Resources. - Mineral B. BATINO, ANICETO A. BURGOS, JAIME A. BURGOS,
Resources are owned by the State and the exploration, FLORENCIA CANUBAS, LORETO A. CANUBAS,
development, utilization, and processing thereof shall be MAXIMO A. CANUBAS, REYNALDO CARINGAL,
under its full control and supervision. The State may QUIRINO C. CASALME, BENIGNO A. CRUZAT, ELINO
directly undertake such activities or it may enter into A. CRUZAT, GREGORIO F. CRUZAT, RUFINO C.
mineral agreements with contractors. (Underscoring ours) CRUZAT, SERGIO CRUZAT, SEVERINO F. CRUZAT,
VICTORIA DE SAGUN, SEVERINO DE SAGUN,
Thus, the State may pursue the constitutional policy of full FELICISIMO A. GONZALES, FRANCISCO A.
control and supervision of the exploration, development GONZALES, GREGORIO GONZALES, LEODEGARIO N.
and utilization of the country's natural mineral resources, GONZALES, PASCUAL P. GONZALES, ROLANDO A.
by either directly undertaking the same or by entering into GONZALES, FRANCISCO A. JUANGCO, GERVACIO A.
agreements with qualified entities. The DENR Secretary JUANGCO, LOURDES U. LUNA, ANSELMO M.
acted within his authority when he ordered a study of the MANDANAS, CRISANTO MANDANAS, EMILIO M.
first option, which may be undertaken consistently in MANDANAS, GREGORIO A. MANDANAS, MARIO G.
accordance with the constitutional policy enunciated MANDANAS, TEODORO MANDANAS, CONSTANCIO
above. Obviously, the State may not be precluded from B. MARQUEZ, EUGENIO B. MARQUEZ, ARMANDO P.
considering a direct takeover of the mines, if it is the only MATIENZO, DANIEL D. MATIENZO, MAXIMINO
plausible remedy in sight to the gnawing complexities MATIENZO, PACENCIA P. MATIENZO, DOROTEA L.
generated by the gold rush. As implied earlier, the State PANGANIBAN, JUANITO T. PEREZ, MARIANITO T.
need be guided only by the demands of public interest in PEREZ, SEVERO M. PEREZ, INOCENCIA S.
settling for this option, as well as its material and logistic PASQUIZA, BIENVENIDO F. PETATE, IGNACIO F.
feasibility. PETATE, JUANITO PETATE, PABLO A. PLATON,
PRECILLO V. PLATON, AQUILINO B. SUBOL,
In this regard, petitioner's imputation of bad faith on the CASIANO T. VILLA, DOMINGO VILLA, JUAN T. VILLA,
part of the DENR Secretary when the latter issued MO 97- MARIO C. VILLA, NATIVIDAD A. VILLA, JACINTA S.
03 is not well-taken. The avowed rationale of the ALVARADO, RODOLFO ANGELES, DOMINGO A.
memorandum order is clearly and plainly stated in its CANUBAS, EDGARDO L. CASALME, QUIRINO DE
"whereas" clauses.23 In the absence of any concrete LEON, LEONILO M. ENRIQUEZ, CLAUDIA P.
evidence that the DENR Secretary violated the law or GONZALES, FELISA R. LANGUE, QUINTILLANO
abused his discretion, as in this case, he is presumed to LANGUE, REYNALDO LANGUE, ROMEO S. LANGUE,
have regularly issued the memorandum with a lawful intent BONIFACIO VILLA, ROGELIO AYENDE, ANTONIO B.
and pursuant to his official functions.1wphi1.nt FERNANDEZ, ZACARIAS HERRERA, ZACARIAS
HERRERA, REYNARIO U. LAZO, AGAPITO MATIENZO,
Given these considerations, petitioner's first assigned error DIONISIO F. PETATE, LITO G. REYES, JOSE M.
is baseless and premised on tentative assumptions. SUBOL, CELESTINO G. TOPI NO, ROSA C. AMANTE,
Petitioner cannot claim any absolute right to the Diwalwal SOTERA CASALME, REMIGIO M. SILVERIO, THE
mines pending resolution of the Consolidated Mines SECRETARY OF AGRARIAN REFORM, DEPARTMENT
cases, much less ask us to assume, at this point, that OF AGRARIAN REFORM ADJUDICATION BOARD,
Law on NatRes (73-83 19

LAND BANK OF THE PHILIPPINES, REGISTER OF appropriate for agricultural purposes. The area was
DEEDS OF LAGUNA, DEPARTMENT OF rugged in terrain with slopes of 18% and above and that
ENVIRONMENT AND NATURAL RESOURCES the occupants of the land were squatters, who were not
REGIONAL EXECUTIVE DIRECTOR FOR REGION IV, entitled to any land as beneficiaries.7
and REGIONAL AGRARIAN REFORM OFFICER FOR
REGION IV, respondents; G.R. No. 112526 On August 29, 1989, the farmer beneficiaries together with
October 12, 2001 the BARC chairman answered the protest and objection
stating that the slope of the land is not 18% but only 5-
The case before the Court is a petition for review on 10% and that the land is suitable and economically viable
certiorari of the decision of the Court of Appeals1 affirming for agricultural purposes, as evidenced by the Certification
the decision of the Department of Agrarian Reform of the Department of Agriculture, municipality of Cabuyao,
Adjudication Board2 (hereafter DARAB) ordering the Laguna.
compulsory acquisition of petitioner's property under the
Comprehensive Agrarian Reform Program (CARP). On September 8, 1989, MARO Belen dela Torre made a
summary investigation report and forwarded the
Petitioner Sta. Rosa Realty Development Corporation Compulsory Acquisition Folder Indorsement (CAFI) to the
(hereafter, SRRDC) was the registered owner of two Provincial Agrarian Reform Officer (hereafter, PARO).9
parcels of land, situated at Barangay Casile, Cabuyao,
Laguna covered by TCT Nos. 81949 and 84891, with a On September 21, 1989, PARO Durante Ubeda forwarded
total area of 254.6 hectares. According to petitioner, the his endorsement of the compulsory acquisition to the
parcels of land are watersheds, which provide clean Secretary of Agrarian Reform.
potable water to the Canlubang community, and that
ninety (90) light industries are now located in the area.3 On November 23, 1989, Acting Director Eduardo C.
Visperas of the Bureau of Land Acquisition and
Petitioner alleged that respondents usurped its rights over Development, DAR forwarded two (2) Compulsory
the property, thereby destroying the ecosystem. Sometime Acquisition Claim Folders covering the landholding of
in December 1985, respondents filed a civil case4 with the SRRDC, covered by TCT Nos. T-81949 and T-84891 to
Regional Trial Court, Laguna, seeking an easement of a the President, Land Bank of the Philippines for further
right of way to and from Barangay Casile. By way of review and evaluation.10
counterclaim, however, petitioner sought the ejectment of
private respondents. On December 12, 1989, Secretary of Agrarian Reform
Miriam Defensor Santiago sent two (2) notices of
In October 1986 to August 1987, petitioner filed with the acquisition11 to petitioner, stating that petitioner's
Municipal Trial Court, Cabuyao, Laguna separate landholdings covered by TCT Nos. 81949 and 84891,
complaints for forcible entry against respondents.5 containing an area of 188.2858 and 58.5800 hectares,
valued at P4,417,735.65 and P1,220,229.93, respectively,
After the filing of the ejectment cases, respondents had been placed under the Comprehensive Agrarian
petitioned the Department of Agrarian Reform (DAR) for Reform Program.
the compulsory acquisition of the SRRDC property under
the CARP. On February 6, 1990, petitioner SRRDC in two letters12
separately addressed to Secretary Florencio B. Abad and
On August 11, 1989, the Municipal Agrarian Reform the Director, Bureau of Land Acquisition and Distribution,
Officer (MARO) of Cabuyao, Laguna issued a notice of sent its formal protest, protesting not only the amount of
coverage to petitioner and invited its officials or compensation offered by DAR for the property but also the
representatives to a conference on August 18, 1989.6 two (2) notices of acquisition.
During the meeting, the following were present:
representatives of petitioner, the Land Bank of the On March 17, 1990, Secretary Abad referred the case to
Philippines, PARCCOM, PARO of Laguna, MARO of the DARAB for summary proceedings to determine just
Laguna, the BARC Chairman of Barangay Casile and compensation under R. A. No. 6657, Section 16.
some potential farmer beneficiaries, who are residents of
Barangay Casile, Cabuyao, Laguna. It was the consensus On March 23, 1990, the LBP returned the two (2) claim
and recommendation of the assembly that the landholding folders previously referred for review and evaluation to the
of SRRDC be placed under compulsory acquisition. Director of BLAD mentioning its inability to value the
SRRDC landholding due to some deficiencies.
On August 17, 1989, petitioner filed with the Municipal
Agrarian Reform Office (MARO), Cabuyao, Laguna a On March 28, 1990, Executive Director Emmanuel S.
"Protest and Objection" to the compulsory acquisition of Galvez wrote Land Bank President Deogracias Vistan to
the property on the ground that the area was not forward the two (2) claim folders involving the property of
Law on NatRes (73-83 20

SRRDC to the DARAB for it to conduct summary On April 4, 1991, the initial DARAB hearing of the case
proceedings to determine the just compensation for the was held and subsequently, different dates of hearing
land. were set without objection from counsel of SRRDC. During
the April 15, 1991 hearing, the subdivision plan of subject
On April 6, 1990, petitioner sent a letter to the Land Bank property at Casile, Cabuyao, Laguna was submitted and
of the Philippines stating that its property under the marked as Exhibit "5" for SRRDC. At the hearing on April
aforesaid land titles were exempt from CARP coverage 23, 1991, the Land Bank asked for a period of one month
because they had been classified as watershed area and to value the land in dispute.
were the subject of a pending petition for land conversion.
At the hearing on April 23, 1991, certification from Deputy
On May 10, 1990, Director Narciso Villapando of BLAD Zoning Administrator Generoso B. Opina was presented.
turned over the two (2) claim folders (CACF's) to the The certification issued on September 8, 1989, stated that
Executive Director of the DAR Adjudication Board for the parcels of land subject of the case were classified as
proper administrative valuation. Acting on the CACF's, on "industrial Park" per Sanguniang Bayan Resolution No.
September 10, 1990, the Board promulgated a resolution 45-89 dated March 29, 1989.14
asking the office of the Secretary of Agrarian Reform
(DAR) to first resolve two (2) issues before it proceeds To avert any opportunity that the DARAB might distribute
with the summary land valuation proceedings.13 the lands to the farmer beneficiaries, on April 30, 1991,
petitioner filed a petition15 with DARAB to disqualify
The issues that need to be threshed out were as follows: private respondents as beneficiaries. However, DARAB
(1) whether the subject parcels of land fall within the refused to address the issue of beneficiaries.
coverage of the Compulsory Acquisition Program of the
CARP; and (2) whether the petition for land conversion of In the meantime, on January 20, 1992, the Regional Trial
the parcels of land may be granted. Court, Laguna, Branch 24, rendered a decision,16 finding
that private respondents illegally entered the SRRDC
On December 7, 1990, the Office of the Secretary, DAR, property, and ordered them evicted.
through the Undersecretary for Operations (Assistant
Secretary for Luzon Operations) and the Regional Director On July 11, 1991, DAR Secretary Benjamin T. Leong
of Region IV, submitted a report answering the two issues issued a memorandum directing the Land Bank of the
raised. According to them, firstly, by virtue of the issuance Philippines to open a trust account in favor of SRRDC, for
of the notice of coverage on August 11, 1989, and notice P5,637,965.55, as valuation for the SRRDC property.
of acquisition on December 12, 1989, the property is
covered under compulsory acquisition. Secondly, On December 19, 1991, DARAB promulgated a decision,
Administrative Order No. 1, Series of 1990, Section IV D the decretal portion of which reads:
also supports the DAR position on the coverage of the
said property. During the consideration of the case by the "WHEREFORE, based on the foregoing premises, the
Board, there was no pending petition for land conversion Board hereby orders:
specifically concerning the parcels of land in question.
"1. The dismissal for lack of merit of the protest against the
On February 19, 1991, the Board sent a notice of hearing compulsory coverage of the landholdings of Sta. Rosa
to all the parties interested, setting the hearing for the Realty Development Corporation (Transfer Certificates of
administrative valuation of the subject parcels of land on Title Nos. 81949 and 84891 with an area of 254.766
March 6, 1991. However, on February 22, 1991, Atty. Ma. hectares) in Barangay Casile, Municipality of Cabuyao,
Elena P. Hernandez-Cueva, counsel for SRRDC, wrote Province of Laguna under the Comprehensive Agrarian
the Board requesting for its assistance in the Reform Program is hereby affirmed;
reconstruction of the records of the case because the
records could not be found as her co-counsel, Atty. "2. The Land Bank of the Philippines (LBP) to pay Sta.
Ricardo Blancaflor, who originally handled the case for Rosa Realty Development Corporation the amount of
SRRDC and had possession of all the records of the case Seven Million Eight Hundred Forty-One Thousand, Nine
was on indefinite leave and could not be contacted. The Hundred Ninety Seven Pesos and Sixty-Four centavos
Board granted counsel's request and moved the hearing to (P7,841,997.64) for its landholdings covered by the two (2)
April 4, 1991. Transfer Certificates of Title mentioned above. Should
there be a rejection of the payment tendered, to open, if
On March 18, 1991, SRRDC submitted a petition to the none has yet been made, a trust account for said amount
Board for the latter to resolve SRRDC's petition for in the name of Sta. Rosa Realty Development
exemption from CARP coverage before any administrative Corporation;
valuation of their landholding could be had by the Board.
Law on NatRes (73-83 21

"3. The Register of Deeds of the Province of Laguna to Case No. JC-R-IV-LAG-0001, which was affirmed by the
cancel with dispatch Transfer certificate of Title Nos. Court of Appeals in a Decision dated November 5, 1993,
84891 and 81949 and new one be issued in the name of and which ordered, among others, the Regional Office of
the Republic of the Philippines, free from liens and the Department of Agrarian Reform through its Municipal
encumbrances; and Provincial Reform Office to take immediate
possession of the landholding in dispute after title shall
"4 The Department of Environment and Natural Resources have been transferred to the name of the Republic of the
either through its Provincial Office in Laguna or the Philippines and to distribute the same through the
Regional Office, Region IV, to conduct a final segregation immediate issuance of Emancipation Patents to the
survey on the lands covered by Transfer certificate of Title farmer-beneficiaries as determined by the Municipal
Nos. 84891 and 81949 so the same can be transferred by Agrarian Officer of Cabuyao, Laguna, (b) The Department
the Register of Deeds to the name of the Republic of the of Agrarian Reform and/or the Department of Agrarian
Philippines; Reform Adjudication Board, and all persons acting for and
in their behalf and under their authority from entering the
"5. The Regional Office of the Department of Agrarian properties involved in this case and from introducing
Reform through its Municipal and Provincial Agrarian permanent infrastructures thereon; and (c) the private
Reform Office to take immediate possession on the said respondents from further clearing the said properties of
landholding after Title shall have been transferred to the their green cover by the cutting or burning of trees and
name of the Republic of the Philippines, and distribute the other vegetation, effective today until further orders from
same to the immediate issuance of Emancipation Patents this Court."22
to the farmer-beneficiaries as determined by the Municipal
Agrarian Reform Office of Cabuyao, Laguna."17 The main issue raised is whether the property in question
is covered by CARP despite the fact that the entire
On January 20, 1992, the Regional Trial Court, Laguna, property formed part of a watershed area prior to the
Branch 24, rendered a decision in Civil Case No. B- enactment of R. A. No. 6657.
233318 ruling that respondents were builders in bad faith.
Under Republic Act No. 6657, there are two modes of
On February 6, 1992, petitioner filed with the Court of acquisition of private land: compulsory and voluntary. In
Appeals a petition for review of the DARAB decision.19 On the case at bar, the Department of Agrarian Reform
November 5, 1993, the Court of Appeals promulgated a sought the compulsory acquisition of subject property
decision affirming the decision of DARAB. The decretal under R. A. No. 6657, Section 16, to wit:
portion of the Court of Appeals decision reads:
"Sec. 16. Procedure for Acquisition of Private Lands. For
"WHEREFORE, premises considered, the DARAB purposes of acquisition of private lands, the following
decision dated September 19, 1991 is AFFIRMED, without procedures shall be followed:
prejudice to petitioner Sta. Rosa Realty Development
Corporation ventilating its case with the Special Agrarian a.) After having identified the land, the landowners and the
Court on the issue of just compensation."20Hence, this beneficiaries, the DAR shall send its notice to acquire the
petition.21 land to the owners thereof, by personal delivery or
registered mail, and post the same in a conspicuous place
On December 15, 1993, the Court issued a Resolution in the municipal building and barangay hall of the place
which reads: where the property is located. Said notice shall contain the
offer of the DAR to pay corresponding value in accordance
"G. R. Nos. 112526 (Sta. Rosa Realty Development with the valuation set forth in Sections 17, 18, and other
Corporation vs. Court of Appeals, et. al.) Considering the pertinent provisions hereof.
compliance, dated December 13, 1993, filed by counsel
for petitioner, with the resolution of December 8, 1993 b.) Within thirty (30) days from the date of the receipt of
which required petitioner to post a cash bond or surety written notice by personal delivery or registered mail, the
bond in the amount of P1,500,000.00 Pesos before issuing landowner, his administrator or representative shall inform
a temporary restraining order prayed for, manifesting that the DAR of his acceptance or rejection of the offer.
it has posted a CASH BOND in the same amount with the
Cashier of the Court as evidenced by the attached official c.) If the landowner accepts the offer of the DAR, the LBP
receipt no. 315519, the Court resolved to ISSUE the shall pay the landowner the purchase price of the land
Temporary Retraining Order prayed for. within thirty (30) days after he executes and delivers a
deed of transfer in favor of the government and other
"The Court therefore, resolved to restrain: (a) the muniments of title.
Department of Agrarian Reform Adjudication Board from
enforcing its decision dated December 19, 1991 in DARAB
Law on NatRes (73-83 22

d.) In case of rejection or failure to reply, the DAR shall the DAR shall deposit the compensation in cash or in LBP
conduct summary administrative proceedings to determine bonds with an accessible bank. The DAR shall
the compensation for the land requiring the landowner, the immediately take possession of the land and cause the
LBP and other interested parties to submit fifteen (15) issuance of a transfer certificate of title in the name of the
days from receipt of the notice. After the expiration of the Republic of the Philippines. The land shall then be
above period, the matter is deemed submitted for decision. redistributed to the farmer beneficiaries. Any party may
The DAR shall decide the case within thirty (30) days after question the decision of the DAR in the special agrarian
it is submitted for decision. courts (provisionally the Supreme Court designated
branches of the regional trial court as special agrarian
e.) Upon receipt by the landowner of the corresponding courts) for final determination of just compensation.
payment, or, in case of rejection or no response from the
landowner, upon the deposit with an accessible bank The DAR has made compulsory acquisition the priority
designated by the DAR of the compensation in cash or in mode of land acquisition to hasten the implementation of
LBP bonds in accordance with this act, the DAR shall the Comprehensive Agrarian Reform Program (CARP).
make immediate possession of the land and shall request Under Sec. 16 of the CARL, the first step in compulsory
the proper Register of Deeds to issue Transfer Certificate acquisition is the identification of the land, the landowners
of Titles (TCT) in the name of the Republic of the and the farmer beneficiaries. However, the law is silent on
Philippines. The DAR shall thereafter proceed with the how the identification process shall be made. To fill this
redistribution of the land to the qualified beneficiaries. gap, on July 26, 1989, the DAR issued Administrative
Order No. 12, series of 1989, which set the operating
f.) Any party who disagrees with the decision may bring procedure in the identification of such lands. The
the matter to the court23 of proper jurisdiction for final procedure is as follows:
determination of just compensation.
A. The Municipal Agrarian Reform Officer (MARO), with
In compulsory acquisition of private lands, the landholding, the assistance of the pertinent Barangay Agrarian Reform
the landowners and farmer beneficiaries must first be Committee (BARC), shall:
identified. After identification, the DAR shall send a notice
of acquisition to the landowner, by personal delivery or 1. Update the masterlist of all agricultural lands covered
registered mail, and post it in a conspicuous place in the under the CARP in his area of responsibility; the masterlist
municipal building and barangay hall of the place where should include such information as required under the
the property is located. attached CARP masterlist form which shall include the
name of the landowner, landholding area, TCT/OCT
Within thirty (30) days from receipt of the notice of number, and tax declaration number.
acquisition, the landowner, his administrator or
representative shall inform the DAR of his acceptance or 2. Prepare the Compulsory Acquisition Case Folder
rejection of the offer. (CACF) for each title (OCT/TCT) or landholding covered
under Phase I and II of the CARP except those for which
If the landowner accepts, he executes and delivers a deed the landowners have already filed applications to avail of
of transfer in favor of the government and surrenders the other modes of land acquisition. A case folder shall
certificate of title. Within thirty (30) days from the execution contain the following duly accomplished forms:
of the deed of transfer, the Land Bank of the Philippines
(LBP) pays the owner the purchase price. If the landowner a) CARP CA Form 1MARO investigation report
accepts, he executes and delivers a deed of transfer in
favor of the government and surrenders the certificate of b) CARP CA Form No 2 Summary investigation report
title. Within thirty days from the execution of the deed of findings and evaluation
transfer, the Land Bank of the Philippines (LBP) pays the
owner the purchase price. If the landowner rejects the c) CARP CA Form 3Applicant's Information sheet
DAR's offer or fails to make a reply, the DAR conducts
summary administrative proceedings to determine just d) CARP CA Form 4 Beneficiaries undertaking
compensation for the land. The landowner, the LBP
representative and other interested parties may submit e) CARP CA Form 5 Transmittal report to the PARO
evidence on just compensation within fifteen days from
notice. Within thirty days from submission, the DAR shall The MARO/BARC shall certify that all information
decide the case and inform the owner of its decision and contained in the above-mentioned forms have been
the amount of just compensation. examined and verified by him and that the same are true
and correct.
Upon receipt by the owner of the corresponding payment,
or, in case of rejection or lack of response from the latter,
Law on NatRes (73-83 23

3. Send notice of coverage and a letter of invitation to a three days from its approval. The notice shall include
conference/meeting to the landowner covered by the among others, the area subject of compulsory acquisition,
Compulsory Case Acquisition Folder. Invitations to the and the amount of just compensation offered by DAR.
said conference meeting shall also be sent to the
prospective farmer-beneficiaries, the BARC 3. Should the landowner accept the DAR's offered value,
representatives, the Land Bank of the Philippines (LBP) the BLAD shall prepare and submit to the Secretary for
representative, and the other interested parties to discuss approval the order of acquisition. However, in case of
the inputs to the valuation of the property. rejection or non-reply, the DAR Adjudication Board
(DARAB) shall conduct a summary administrative hearing
He shall discuss the MARO/BARC investigation report and to determine just compensation, in accordance with the
solicit the views, objection, agreements or suggestions of procedures provided under Administrative Order No. 13,
the participants thereon. The landowner shall also ask to series of 1989. Immediately upon receipt of the DARAB's
indicate his retention area. The minutes of the meeting decision on just compensation, the BLAD shall prepare
shall be signed by all participants in the conference and and submit to the Secretary for approval the required order
shall form an integral part of the CACF. of acquisition.

4. Submit all completed case folders to the Provincial 4. Upon the landowner's receipt of payment, in case of
Agrarian Reform Officer (PARO). acceptance, or upon deposit of payment in the designated
bank, in case of rejection or non-response, the Secretary
B. The PARO shall: shall immediately direct the pertinent Register of Deeds to
issue the corresponding Transfer Certificate of Title (TCT)
1. Ensure the individual case folders are forwarded to him in the name of the Republic of the Philippines. Once the
by his MAROs. property is transferred, the DAR, through the PARO, shall
take possession of the land for redistribution to qualified
2. Immediately upon receipt of a case folder, compute the beneficiaries."
valuation of the land in accordance with A.O. No. 6, series
of 1988. The valuation worksheet and the related CACF Administrative Order No. 12, Series of 1989 requires that
valuation forms shall be duly certified correct by the PARO the Municipal Agrarian Reform Officer (MARO) keep an
and all the personnel who participated in the updated master list of all agricultural lands under the
accomplishment of these forms. CARP in his area of responsibility containing all the
required information. The MARO prepares a Compulsory
3. In all cases, the PARO may validate the report of the Acquisition Case Folder (CACF) for each title covered by
MARO through ocular inspection and verification of the CARP. The MARO then sends the landowner a "Notice of
property. This ocular inspection and verification shall be Coverage" and a "letter of invitation" to a "conference/
mandatory when the computed value exceeds P500,000 meeting" over the land covered by the CACF. He also
per estate. sends invitations to the prospective farmer-beneficiaries,
the representatives of the Barangay Agrarian Reform
4. Upon determination of the valuation, forward the case Committee (BARC), the Land Bank of the Philippines
folder, together with the duly accomplished valuation forms (LBP) and other interested parties to discuss the inputs to
and his recommendations, to the Central Office. the valuation of the property and solicit views,
suggestions, objections or agreements of the parties. At
The LBP representative and the MARO concerned shall the meeting, the landowner is asked to indicate his
be furnished a copy each of his report. retention area.

C. DAR Central Office, specifically through the Bureau of The MARO shall make a report of the case to the
Land Acquisition and Distribution (BLAD), shall: Provincial Agrarian Reform Officer (PARO) who shall
complete the valuation of the land. Ocular inspection and
1. Within three days from receipt of the case folder from verification of the property by the PARO shall be
the PARO, review, evaluate and determine the final land mandatory when the computed value of the estate
valuation of the property covered by the case folder. A exceeds P500,000.00. Upon determination of the
summary review and evaluation report shall be prepared valuation, the PARO shall forward all papers together with
and duly certified by the BLAD Director and the personnel his recommendation to the Central Office of the DAR. The
directly participating in the review and final valuation. DAR Central Office, specifically, the Bureau of Land
Acquisition and Distribution (BLAD) shall prepare, on the
2. Prepare, for the signature of the Secretary or her duly signature of the Secretary or his duly authorized
authorized representative, a notice of acquisition (CARP representative, a notice of acquisition of the subject
Form 8) for the subject property. Serve the notice to the property. From this point, the provisions of R. A. No. 6657,
landowner personally or through registered mail within Section 16 shall apply.
Law on NatRes (73-83 24

such activities by the owners or occupants thereof within


For a valid implementation of the CARP Program, two the protected area which may damage or cause the
notices are required: (1) the notice of coverage and letter deterioration of the surface water or ground water or
of invitation to a preliminary conference sent to the interfere with the investigation, use, control, protection,
landowner, the representative of the BARC, LBP, farmer management or administration of such waters."
beneficiaries and other interested parties pursuant to DAR
A. O. No. 12, series of 1989; and (2) the notice of Watersheds may be defined as "an area drained by a river
acquisition sent to the landowner under Section 16 of the and its tributaries and enclosed by a boundary or divide
CARL. which separates it from adjacent watersheds." Watersheds
generally are outside the commerce of man, so why was
The importance of the first notice, that is, the notice of the Casile property titled in the name of SRRDC? The
coverage and the letter of invitation to a conference, and answer is simple. At the time of the titling, the Department
its actual conduct cannot be understated. They are steps of Agriculture and Natural Resources had not declared the
designed to comply with the requirements of administrative property as watershed area. The parcels of land in
due process. The implementation of the CARL is an Barangay Casile were declared as "PARK" by a Zoning
exercise of the State's police power and the power of Ordinance adopted by the municipality of Cabuyao in
eminent domain. To the extent that the CARL prescribes 1979, as certified by the Housing and Land Use
retention limits to the landowners, there is an exercise of Regulatory Board. On January 5, 1994, the Sangguniang
police power for the regulation of private property in Bayan of Cabuyao, Laguna issued a Resolution26 voiding
accordance with the Constitution. But where, to carry out the zoning classification of the land at Barangay Casile as
such regulation, the owners are deprived of lands they Park and declaring that the land is now classified as
own in excess of the maximum area allowed, there is also agricultural land.
a taking under the power of eminent domain. The taking
contemplated is not mere limitation of the use of the land. The authority of the municipality of Cabuyao, Laguna to
What is required is the surrender of the title to and issue zoning classification is an exercise of its police
physical possession of the excess and all beneficial rights power, not the power of eminent domain. "A zoning
accruing to the owner in favor of the farmer beneficiary. ordinance is defined as a local city or municipal legislation
which logically arranges, prescribes, defines and
In the case at bar, DAR has executed the taking of the apportions a given political subdivision into specific land
property in question. However, payment of just uses as present and future projection of needs."27
compensation was not in accordance with the procedural
requirement. The law required payment in cash or LBP In Natalia Realty, Inc. v. Department of Agrarian Reform28
bonds, not by trust account as was done by DAR. we held that lands classified as non-agricultural prior to the
effectivity of the CARL may not be compulsorily acquired
In Association of Small Landowners in the Philippines v. for distribution to farmer beneficiaries.
Secretary of Agrarian Reform, we held that "The CARP
Law, for its part, conditions the transfer of possession and However, more than the classification of the subject land
ownership of the land to the government on receipt of the as PARK is the fact that subsequent studies and survey
landowner of the corresponding payment or the deposit by showed that the parcels of land in question form a vital
the DAR of the compensation in cash or LBP bonds with part of a watershed area.29
an accessible bank. Until then, title also remains with the
landowner. No outright change of ownership is Now, petitioner has offered to prove that the land in
contemplated either."24 dispute is a "watershed or part of the protected area for
watershed purposes." Ecological balances and
Consequently, petitioner questioned before the Court of environmental disasters in our day and age seem to be
Appeals DARAB's decision ordering the compulsory interconnected. Property developers and tillers of the land
acquisition of petitioner's property.25 Here, petitioner must be aware of this deadly combination. In the case at
pressed the question of whether the property was a bar, DAR included the disputed parcels of land for
watershed, not covered by CARP. compulsory acquisition simply because the land was
allegedly devoted to agriculture and was titled to SRRDC,
Article 67 of the Water Code of the Philippines (P. D. No. hence, private and alienable land that may be subject to
1067) provides: CARP.

"Art. 67. Any watershed or any area of land adjacent to However, the scenario has changed, after an in-depth
any surface water or overlying any ground water may be study, survey and reassessment. We cannot ignore the
declared by the Department of Natural resources as a fact that the disputed parcels of land form a vital part of an
protected area. Rules and Regulations may be area that need to be protected for watershed purposes. In
promulgated by such Department to prohibit or control a report of the Ecosystems Research and Development
Law on NatRes (73-83 25

Bureau (ERDB), a research arm of the DENR, regarding Dano, who obtained his doctorate degree in Soil and
the environmental assessment of the Casile and Kabanga- Water management Conservation from U.P. Los Banos in
an river watersheds, they concluded that: 1993.

"The Casile barangay covered by CLOA in question is Also, DENR Secretary Angel Alcala submitted a
situated in the heartland of both watersheds. Considering Memorandum for the President dated September 7, 1993
the barangays proximity to the Matangtubig waterworks, (Subject: PFVR HWI Ref.: 933103 Presidential Instructions
the activities of the farmers which are in conflict with on the Protection of Watersheds of the Canlubang Estates
proper soil and water conservation practices jeopardize at Barrio Casile, Cabuyao, Laguna) which reads:
and endanger the vital waterworks. Degradation of the
land would have double edge detrimental effects. On the "It is the opinion of this office that the area in question
Casile side this would mean direct siltation of the must be maintained for watershed purposes for ecological
Mangumit river which drains to the water impounding and environmental considerations, among others.
reservoir below. On the Kabanga-an side, this would mean Although the 88 families who are the proposed CARP
destruction of forest covers which acts as recharged areas beneficiaries will be affected, it is important that a larger
of the Matang Tubig springs. Considering that the people view of the situation be taken as one should also consider
have little if no direct interest in the protection of the the adverse effect on thousands of residents downstream
Matang Tubig structures they couldn't care less even if it if the watershed will not be protected and maintained for
would be destroyed. watershed purposes.

The Casile and Kabanga-an watersheds can be "The foregoing considered, it is recommended that if
considered a most vital life support system to thousands of possible, an alternate area be allocated for the affected
inhabitants directly and indirectly affected by it. From these farmers, and that the Canlubang Estates be mandated to
watersheds come the natural God-given precious resource protect and maintain the area in question as a permanent
water. x x x x x watershed reserved."31

Clearing and tilling of the lands are totally inconsistent with The definition does not exactly depict the complexities of a
sound watershed management. More so, the introduction watershed. The most important product of a watershed is
of earth disturbing activities like road building and erection water which is one of the most important human necessity.
of permanent infrastructures. Unless the pernicious The protection of watersheds ensures an adequate supply
agricultural activities of the Casile farmers are immediately of water for future generations and the control of
stopped, it would not be long before these watersheds flashfloods that not only damage property but cause loss
would cease to be of value. The impact of watershed of lives. Protection of watersheds is an "intergenerational
degredation threatens the livelihood of thousands of responsibility" that needs to be answered now.
people dependent upon it. Toward this, we hope that an
acceptable comprehensive watershed development policy Another factor that needs to be mentioned is the fact that
and program be immediately formulated and implemented during the DARAB hearing, petitioner presented proof that
before the irreversible damage finally happens. the Casile property has slopes of 18% and over, which
exempted the land from the coverage of CARL. R. A. No.
Hence, the following are recommended: 6657, Section 10, provides:

7.2 The Casile farmers should be relocated and given "Section 10. Exemptions and Exclusions. Lands actually,
financial assistance. directly and exclusively used and found to be necessary
for parks, wildlife, forest reserves, reforestration, fish
7.3 Declaration of the two watersheds as critical and in sanctuaries and breeding grounds, watersheds and
need of immediate rehabilitation. mangroves, national defense, school sites and campuses
including experimental farm stations operated by public or
7.4 A comprehensive and detailed watershed private schools for educational purposes, seeds and
management plan and program be formulated and seedlings research and pilot production centers, church
implemented by the Canlubang Estate in coordination with sites and convents appurtenent thereto, communal burial
pertinent government agencies."30 grounds and cemeteries, penal colonies and penal farms
actually worked by the inmates, government and private
The ERDB report was prepared by a composite team research and quarantine centers, and all lands with
headed by Dr. Emilio Rosario, the ERDB Director, who eighteen percent (18%) slope and over, except those
holds a doctorate degree in water resources from U.P. Los already developed shall be exempt from coverage of this
Banos in 1987; Dr. Medel Limsuan, who obtained his Act."
doctorate degree in watershed management from
Colorado University (US) in 1989; and Dr. Antonio M.
Law on NatRes (73-83 26

Hence, during the hearing at DARAB, there was proof jurisdiction over all final judgments, decisions, resolutions,
showing that the disputed parcels of land may be excluded order[s] or awards of . . . quasi-judicial agencies,
from the compulsory acquisition coverage of CARP instrumentalities, boards or commission[s] . . . except
because of its very high slopes. those within the appellate jurisdiction of the Supreme
Court . . . ." Thus the RTC explained:
To resolve the issue as to the true nature of the parcels of
land involved in the case at bar, the Court directs the Art. 89 of P.D. 1067 having been long repealed by BP 129,
DARAB to conduct a re-evaluation of the issue. as amended, which has effectively and explicitly removed
the Regional Trial Courts appellate jurisdiction over the
IN VIEW WHEREOF, the Court SETS ASIDE the decision decisions, resolutions, order[s] or awards of quasi-judicial
of the Court of Appeals in CA-G. R. SP No. 27234. agencies such as [petitioner] NWRB, and vested with the
Court of Appeals, very clearly now, this Court has no
In lieu thereof, the Court REMANDS the case to the jurisdiction over this instant petition.
DARAB for re-evaluation and determination of the nature
of the parcels of land involved to resolve the issue of its Its motion for reconsideration having been denied,
coverage by the Comprehensive Land Reform Program. respondent filed a petition for certiorari at the Court of
Appeals, which, by Decision of January 25, 2008,5
In the meantime, the effects of the CLOAs issued by the annulled and set aside the RTC April 15, 2005, holding
DAR to supposed farmer beneficiaries shall continue to be that it is the RTC which has jurisdiction over appeals from
stayed by the temporary restraining order issued on petitioners decisions. Thus the appellate court discoursed.
December 15, 1993, which shall remain in effect until final
decision on the case. No costs. SO ORDERED. In the analogous case of BF Northwest Homeowners
Association, Inc. vs. Intermediate Appellate Court[,] the
NATIONAL WATER RESOURCES BOARD (NWRB), Supreme Court . . . categorically pronounced the RTCs
Petitioner, vs. A. L. ANG NETWORK, INC., jurisdiction over appeals from the decisions of the NWRB
Respondent.; G.R. No. 186450 April 14, 2010 consistent with Article 89 of P.D. No. 1067 and
ratiocinated in this wise:
In issue is whether Regional Trial Courts have jurisdiction
over appeals from decisions, resolutions or orders of the x x x x.
National Water Resources Board (petitioner).
The logical conclusion, therefore, is that jurisdiction over
A.L. Ang Network (respondent) filed on January 23, 2003 actions for annulment of NWRC decisions lies with the
an application for a Certificate of Public Convenience Regional Trial Courts, particularly, when we take note of
(CPC) with petitioner to operate and maintain a water the fact that the appellate jurisdiction of the Regional Trial
service system in Alijis, Bacolod City. Court over NWRC decisions covers such broad and all
embracing grounds as grave abuse of discretion,
Bacolod City Water District (BACIWA) opposed questions of law, and questions of fact and law (Art. 89,
respondents application on the ground that it is the only P.D. No. 1067). This conclusion is also in keeping with the
government agency authorized to operate a water service Judiciary Reorganization Act of 1980, which vests
system within the city.1 Regional Trial Courts with original jurisdiction to issue writs
of certiorari, prohibition, mandamus, etc. (Sec. 21 [1], B.P.
By Decision of August 20, 2003, petitioner granted Blg. 129) relating to acts or omissions of an inferior court
respondents CPC application. BACIWA moved to have (Sec. 4, Rule 65, Rules of Court).
the decision reconsidered, contending that its right to due
process was violated when it was not allowed to present x x x x.
evidence in support of its opposition.2
Similarly, in Tanjay Water District vs. Pedro Gabaton, the
Petitioner reconsidered its Decision and allowed BACIWA Supreme Court conformably ruled, viz:
to present evidence,3 drawing respondent to file a petition
for certiorari with the Regional Trial Court (RTC) of "Inasmuch as Civil Case No. 8144 involves the
Bacolod City against petitioner and BACIWA. Petitioner appropriation, utilization and control of water, We hold that
moved to dismiss the petition, arguing that the proper the jurisdiction to hear and decide the dispute in the first
recourse of respondent was to the Court of Appeals, citing instance, pertains to the Water Resources Council as
Rule 43 of the Rules of Court. provided in PD No. 1067 which is the special law on the
subject. The Court of First Instance (now Regional Trial
The RTC, by Order of April 15, 2005,4 dismissed Court) has only appellate jurisdiction over the case."
respondents petition for lack of jurisdiction, holding that it
is the Court of Appeals which has "exclusive appellate
Law on NatRes (73-83 27

Based on the foregoing jurisprudence, there is no doubt writs or processes, whether or not in aid of its appellate
that [petitioner] NWRB is mistaken in its assertion. As no jurisdiction.10
repeal is expressly made, Article 89 of P.D. No. 1067 is
certainly meant to be an exception to the jurisdiction of the Since the appellate court has exclusive appellate
Court of Appeals over appeals or petitions for certiorari of jurisdiction over quasi-judicial agencies under Rule 4311
the decisions of quasi-judicial bodies. This finds harmony of the Rules of Court, petitions for writs of certiorari,
with Paragraph 2, Section 4, Rule 65 of the Rules of Court prohibition or mandamus against the acts and omissions
wherein it is stated that, "If it involves the acts of a quasi- of quasi-judicial agencies, like petitioner, should be filed
judicial agency, unless otherwise provided by law or these with it. This is what Rule 65 of the Rules imposes for
rules, the petition shall be filed in and cognizable only by procedural uniformity. The only exception to this
the Court of Appeals." Evidently, not all petitions for instruction is when the law or the Rules itself directs
certiorari under Rule 65 involving the decisions of quasi- otherwise, as cited in Section 4, Rule 65.12 The appellate
judicial agencies must be filed with the Court of Appeals. courts construction that Article 89 of PD 1067, which
The rule admits of some exceptions as plainly provided by reads:
the phrase "unless otherwise provided by law or these
rules" and Article 89 of P.D. No. 1067 is verily an example ART. 89. The decisions of the [NWRB] on water rights
of these exceptions. (italics and emphasis partly in the controversies may be appealed to the [RTC] of the
original; underscoring supplied) province where the subject matter of the controversy is
situated within fifteen (15) days from the date the party
Petitioners motion for reconsideration having been denied appealing receives a copy of the decision, on any of the
by the appellate court by Resolution of February 9, 2009,6 following grounds: (1) grave abuse of discretion; (2)
petitioner filed the present petition for review, contending question of law; and (3) questions of fact and law
that: (emphasis and underscoring supplied), is such an
exception, is erroneous.
THE REGIONAL TRIAL COURT HAS NO CERTIORARI
JURISDICTION OVER THE [PETITIONER] SINCE Article 89 of PD 1067 had long been rendered inoperative
SECTION 89, PD NO. 1067, REGARDING APPEALS, by the passage of BP 129. Aside from delineating the
HAS BEEN SUPERSEDED AND REPEALED BY [BATAS jurisdictions of the Court of Appeals and the RTCs,
PAMBANSA BILANG] 129 AND THE RULES OF COURT. Section 47 of BP 129 repealed or modified:
FURTHERMORE, PD 1067 ITSELF DOES NOT
CONTEMPLATE THAT THE REGIONAL TRIAL COURT x x x. [t]he provisions of Republic Act No. 296, otherwise
SHOULD HAVE CERTIORARI JURISDICTION OVER known as the Judiciary Act of 1948, as amended, of
THE [PETITIONER].7 (underscoring supplied) Republic Act No. 5179, as amended, of the Rules of Court,
and of all other statutes, letters of instructions and general
Petitioner maintains that the RTC does not have orders or parts thereof, inconsistent with the provisions of
jurisdiction over a petition for certiorari and prohibition to this Act x x x. (emphasis and underscoring supplied)
annul or modify its acts or omissions as a quasi-judicial
agency. Citing Section 4 of Rule 65 of the Rules of Court, The general repealing clause under Section 47 "predicates
petitioner contends that there is no law or rule which the intended repeal under the condition that a substantial
requires the filing of a petition for certiorari over its acts or conflict must be found in existing and prior acts."13
omissions in any other court or tribunal other than the
Court of Appeals.8 In enacting BP 129, the Batasang Pambansa was
presumed to have knowledge of the provision of Article 89
Petitioner goes on to fault the appellate court in holding of P.D. No. 1067 and to have intended to change it.14 The
that Batas Pambansa Bilang 129 (BP 129) or the Judiciary legislative intent to repeal Article 89 is clear and manifest
Reorganization Act did not expressly repeal Article 89 of given the scope and purpose of BP 129, one of which is to
Presidential Decree No. 1067 (PD 1067) otherwise known provide a homogeneous procedure for the review of
as the Water Code of the Philippines.9 adjudications of quasi-judicial entities to the Court of
Appeals.
Respondent, on the other hand, maintains the correctness
of the assailed decision of the appellate court. More importantly, what Article 89 of PD 1067 conferred to
the RTC was the power of review on appeal the decisions
The petition is impressed with merit. of petitioner. It appears that the appellate court gave
significant consideration to the ground of "grave abuse of
Section 9 (1) of BP 129 granted the Court of Appeals (then discretion" to thus hold that the RTC has certiorari
known as the Intermediate Appellate Court) original jurisdiction over petitioners decisions. A reading of said
jurisdiction to issue writs of mandamus, prohibition, Article 89 shows, however, that it only made "grave abuse
certiorari, habeas corpus and quo warranto, and auxiliary of discretion" as another ground to invoke in an ordinary
Law on NatRes (73-83 28

appeal to the RTC. Indeed, the provision was unique to MANAGEMENT, PHILIPPINE COAST GUARD,
the Water Code at the time of its application in 1976. PHILIPPINE NATIONAL POLICE MARITIME GROUP,
and DEPARTMENT OF THE INTERIOR AND LOCAL
The issuance of BP 129, specifically Section 9 GOVERNMENT, Petitioners, vs. CONCERNED
(Jurisdiction of the Court of Appeals, then known as RESIDENTS OF MANILA BAY, represented and joined
Intermediate Appellate Court), and the subsequent by DIVINA V. ILAS, SABINIANO ALBARRACIN,
formulation of the Rules, clarified and delineated the MANUEL SANTOS, JR., DINAH DELA PEA, PAUL
appellate and certiorari jurisdictions of the Court of DENNIS QUINTERO, MA. VICTORIA LLENOS, DONNA
Appeals over adjudications of quasi-judicial bodies. Grave CALOZA, FATIMA QUITAIN, VENICE SEGARRA,
abuse of discretion may be invoked before the appellate FRITZIE TANGKIA, SARAH JOELLE LINTAG,
court as a ground for an error of jurisdiction. HANNIBAL AUGUSTUS BOBIS, FELIMON
SANTIAGUEL, and JAIME AGUSTIN R. OPOSA,
It bears noting that, in the present case, respondent Respondents; G.R. Nos. 171947-48 February
assailed petitioners order via certiorari before the RTC, 15, 2011
invoking grave abuse of discretion amounting to lack or
excess of jurisdiction as ground-basis thereof. In other On December 18, 2008, this Court rendered a Decision in
words, it invoked such ground not for an error of judgment. G.R. Nos. 171947-48 ordering petitioners to clean up,
rehabilitate and preserve Manila Bay in their different
While Section 9 (3) of BP 12915 and Section 1 of Rule 43 capacities. The fallo reads:
of the Rules of Court16 does not list petitioner as "among"
the quasi-judicial agencies whose final judgments, orders, WHEREFORE, the petition is DENIED. The September
resolutions or awards are appealable to the appellate 28, 2005 Decision of the CA in CA-G.R. CV No. 76528
court, it is non sequitur to hold that the Court of Appeals and SP No. 74944 and the September 13, 2002 Decision
has no appellate jurisdiction over petitioners judgments, of the RTC in Civil Case No. 1851-99 are AFFIRMED but
orders, resolutions or awards. It is settled that the list of with MODIFICATIONS in view of subsequent
quasi-judicial agencies specifically mentioned in Rule 43 is developments or supervening events in the case. The fallo
not meant to be exclusive.17 The employment of the word of the RTC Decision shall now read:
"among" clearly instructs so.1avvphi1
WHEREFORE, judgment is hereby rendered ordering the
BF Northwest Homeowners Association v. Intermediate abovenamed defendant-government agencies to clean up,
Appellate Court,18 a 1987 case cited by the appellate rehabilitate, and preserve Manila Bay, and restore and
court to support its ruling that RTCs have jurisdiction over maintain its waters to SB level (Class B sea waters per
judgments, orders, resolutions or awards of petitioner, is Water Classification Tables under DENR Administrative
no longer controlling in light of the definitive instruction of Order No. 34 [1990]) to make them fit for swimming, skin-
Rule 43 of the Revised Rules of Court. diving, and other forms of contact recreation.

Tanjay Water District v. Gabaton19 is not in point either as In particular:


the issue raised therein was which between the RTC and
the then National Water Resources Council had (1) Pursuant to Sec. 4 of EO 192, assigning the DENR as
jurisdiction over disputes in the appropriation, utilization the primary agency responsible for the conservation,
and control of water. management, development, and proper use of the
countrys environment and natural resources, and Sec. 19
In fine, certiorari and appellate jurisdiction over of RA 9275, designating the DENR as the primary
adjudications of petitioner properly belongs to the Court of government agency responsible for its enforcement and
Appeals. implementation, the DENR is directed to fully implement its
Operational Plan for the Manila Bay Coastal Strategy for
WHEREFORE, the challenged Decision and Resolution of the rehabilitation, restoration, and conservation of the
the Court of Appeals are REVERSED and SET ASIDE. Manila Bay at the earliest possible time. It is ordered to
The April 15, 2005 Order of the Regional Trial Court of call regular coordination meetings with concerned
Bacolod City dismissing petitioners petition for lack of government departments and agencies to ensure the
jurisdiction is UPHELD. SO ORDERED. successful implementation of the aforesaid plan of action
METROPOLITAN MANILA DEVELOPMENT in accordance with its indicated completion schedules.
AUTHORITY, DEPARTMENT OF ENVIRONMENT AND
NATURAL RESOURCES, DEPARTMENT OF (2) Pursuant to Title XII (Local Government) of the
EDUCATION, CULTURE AND SPORTS,1 Administrative Code of 1987 and Sec. 25 of the Local
DEPARTMENT OF HEALTH, DEPARTMENT OF Government Code of 1991, the DILG, in exercising the
AGRICULTURE, DEPARTMENT OF PUBLIC WORKS Presidents power of general supervision and its duty to
AND HIGHWAYS, DEPARTMENT OF BUDGET AND promulgate guidelines in establishing waste management
Law on NatRes (73-83 29

programs under Sec. 43 of the Philippine Environment the Manila Bay waters from vessels docked at ports and
Code (PD 1152), shall direct all LGUs in Metro Manila, apprehend the violators.
Rizal, Laguna, Cavite, Bulacan, Pampanga, and Bataan to
inspect all factories, commercial establishments, and (8) The MMDA, as the lead agency and implementor of
private homes along the banks of the major river systems programs and projects for flood control projects and
in their respective areas of jurisdiction, such as but not drainage services in Metro Manila, in coordination with the
limited to the Pasig-Marikina-San Juan Rivers, the NCR DPWH, DILG, affected LGUs, PNP Maritime Group,
(Paraaque-Zapote, Las Pias) Rivers, the Navotas- Housing and Urban Development Coordinating Council
Malabon-Tullahan-Tenejeros Rivers, the Meycauayan- (HUDCC), and other agencies, shall dismantle and
Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan) remove all structures, constructions, and other
River, the Imus (Cavite) River, the Laguna De Bay, and encroachments established or built in violation of RA 7279,
other minor rivers and waterways that eventually and other applicable laws along the Pasig-Marikina-San
discharge water into the Manila Bay; and the lands Juan Rivers, the NCR (Paraaque-Zapote, Las Pias)
abutting the bay, to determine whether they have Rivers, the Navotas-Malabon-Tullahan-Tenejeros Rivers,
wastewater treatment facilities or hygienic septic tanks as and connecting waterways and esteros in Metro Manila.
prescribed by existing laws, ordinances, and rules and The DPWH, as the principal implementor of programs and
regulations. If none be found, these LGUs shall be ordered projects for flood control services in the rest of the country
to require non-complying establishments and homes to set more particularly in Bulacan, Bataan, Pampanga, Cavite,
up said facilities or septic tanks within a reasonable time to and Laguna, in coordination with the DILG, affected LGUs,
prevent industrial wastes, sewage water, and human PNP Maritime Group, HUDCC, and other concerned
wastes from flowing into these rivers, waterways, esteros, government agencies, shall remove and demolish all
and the Manila Bay, under pain of closure or imposition of structures, constructions, and other encroachments built in
fines and other sanctions. breach of RA 7279 and other applicable laws along the
Meycauayan-Marilao-Obando (Bulacan) Rivers, the
(3) As mandated by Sec. 8 of RA 9275, the MWSS is Talisay (Bataan) River, the Imus (Cavite) River, the
directed to provide, install, operate, and maintain the Laguna De Bay, and other rivers, connecting waterways,
necessary adequate waste water treatment facilities in and esteros that discharge wastewater into the Manila
Metro Manila, Rizal, and Cavite where needed at the Bay.
earliest possible time.
In addition, the MMDA is ordered to establish, operate,
(4) Pursuant to RA 9275, the LWUA, through the local and maintain a sanitary landfill, as prescribed by RA 9003,
water districts and in coordination with the DENR, is within a period of one (1) year from finality of this Decision.
ordered to provide, install, operate, and maintain On matters within its territorial jurisdiction and in
sewerage and sanitation facilities and the efficient and connection with the discharge of its duties on the
safe collection, treatment, and disposal of sewage in the maintenance of sanitary landfills and like undertakings, it is
provinces of Laguna, Cavite, Bulacan, Pampanga, and also ordered to cause the apprehension and filing of the
Bataan where needed at the earliest possible time. appropriate criminal cases against violators of the
respective penal provisions of RA 9003, Sec. 27 of RA
(5) Pursuant to Sec. 65 of RA 8550, the DA, through the 9275 (the Clean Water Act), and other existing laws on
BFAR, is ordered to improve and restore the marine life of pollution.
the Manila Bay. It is also directed to assist the LGUs in
Metro Manila, Rizal, Cavite, Laguna, Bulacan, Pampanga, (9) The DOH shall, as directed by Art. 76 of PD 1067 and
and Bataan in developing, using recognized methods, the Sec. 8 of RA 9275, within one (1) year from finality of this
fisheries and aquatic resources in the Manila Bay. Decision, determine if all licensed septic and sludge
companies have the proper facilities for the treatment and
(6) The PCG, pursuant to Secs. 4 and 6 of PD 979, and disposal of fecal sludge and sewage coming from septic
the PNP Maritime Group, in accordance with Sec. 124 of tanks. The DOH shall give the companies, if found to be
RA 8550, in coordination with each other, shall apprehend non-complying, a reasonable time within which to set up
violators of PD 979, RA 8550, and other existing laws and the necessary facilities under pain of cancellation of its
regulations designed to prevent marine pollution in the environmental sanitation clearance.
Manila Bay.
(10) Pursuant to Sec. 53 of PD 1152, Sec. 118 of RA
(7) Pursuant to Secs. 2 and 6-c of EO 513 and the 8550, and Sec. 56 of RA 9003, the DepEd shall integrate
International Convention for the Prevention of Pollution lessons on pollution prevention, waste management,
from Ships, the PPA is ordered to immediately adopt such environmental protection, and like subjects in the school
measures to prevent the discharge and dumping of solid curricula of all levels to inculcate in the minds and hearts
and liquid wastes and other ship-generated wastes into of students and, through them, their parents and friends,
the importance of their duty toward achieving and
Law on NatRes (73-83 30

maintaining a balanced and healthful ecosystem in the Section 47. Effect of judgments or final orders.The
Manila Bay and the entire Philippine archipelago. effect of a judgment or final order rendered by a court of
the Philippines, having jurisdiction to pronounce the
(11) The DBM shall consider incorporating an adequate judgment or final order, may be as follows:
budget in the General Appropriations Act of 2010 and
succeeding years to cover the expenses relating to the xxxx
cleanup, restoration, and preservation of the water quality
of the Manila Bay, in line with the countrys development (c) In any other litigation between the same parties of their
objective to attain economic growth in a manner consistent successors in interest, that only is deemed to have been
with the protection, preservation, and revival of our marine adjudged in a former judgment or final order which
waters. appears upon its face to have been so adjudged, or which
was actually and necessarily included therein or necessary
(12) The heads of petitioners-agencies MMDA, DENR, thereto. (Emphasis supplied.)
DepEd, DOH, DA, DPWH, DBM, PCG, PNP Maritime
Group, DILG, and also of MWSS, LWUA, and PPA, in line It is clear that the final judgment includes not only what
with the principle of "continuing mandamus," shall, from appears upon its face to have been so adjudged but also
finality of this Decision, each submit to the Court a those matters "actually and necessarily included therein or
quarterly progressive report of the activities undertaken in necessary thereto." Certainly, any activity that is needed to
accordance with this Decision. fully implement a final judgment is necessarily
encompassed by said judgment.
SO ORDERED.
Moreover, the submission of periodic reports is sanctioned
The government agencies did not file any motion for by Secs. 7 and 8, Rule 8 of the Rules of Procedure for
reconsideration and the Decision became final in January Environmental cases:
2009.
Sec. 7. Judgment.If warranted, the court shall grant the
The case is now in the execution phase of the final and privilege of the writ of continuing mandamus requiring
executory December 18, 2008 Decision. The Manila Bay respondent to perform an act or series of acts until the
Advisory Committee was created to receive and evaluate judgment is fully satisfied and to grant such other reliefs as
the quarterly progressive reports on the activities may be warranted resulting from the wrongful or illegal
undertaken by the agencies in accordance with said acts of the respondent. The court shall require the
decision and to monitor the execution phase. respondent to submit periodic reports detailing the
progress and execution of the judgment, and the court
In the absence of specific completion periods, the may, by itself or through a commissioner or the
Committee recommended that time frames be set for the appropriate government agency, evaluate and monitor
agencies to perform their assigned tasks. This may be compliance. The petitioner may submit its comments or
viewed as an encroachment over the powers and observations on the execution of the judgment.
functions of the Executive Branch headed by the President
of the Philippines. Sec. 8. Return of the writ.The periodic reports submitted
by the respondent detailing compliance with the judgment
This view is misplaced. shall be contained in partial returns of the writ. Upon full
satisfaction of the judgment, a final return of the writ shall
The issuance of subsequent resolutions by the Court is be made to the court by the respondent. If the court finds
simply an exercise of judicial power under Art. VIII of the that the judgment has been fully implemented, the
Constitution, because the execution of the Decision is but satisfaction of judgment shall be entered in the court
an integral part of the adjudicative function of the Court. docket. (Emphasis supplied.)
None of the agencies ever questioned the power of the
Court to implement the December 18, 2008 Decision nor With the final and executory judgment in MMDA, the writ of
has any of them raised the alleged encroachment by the continuing mandamus issued in MMDA means that until
Court over executive functions. petitioner-agencies have shown full compliance with the
Courts orders, the Court exercises continuing jurisdiction
While additional activities are required of the agencies like over them until full execution of the judgment.
submission of plans of action, data or status reports, these
directives are but part and parcel of the execution stage of There being no encroachment over executive functions to
a final decision under Rule 39 of the Rules of Court. speak of, We shall now proceed to the recommendation of
Section 47 of Rule 39 reads: the Manila Bay Advisory Committee.
Law on NatRes (73-83 31

Several problems were encountered by the Manila Bay are given up to September 30, 2011 to finish the
Advisory Committee.2 An evaluation of the quarterly inspection of said establishments and houses.
progressive reports has shown that (1) there are
voluminous quarterly progressive reports that are being In case of non-compliance, the LGU officials shall take
submitted; (2) petitioner-agencies do not have a uniform appropriate action to ensure compliance by non-complying
manner of reporting their cleanup, rehabilitation and factories, commercial establishments and private homes
preservation activities; (3) as yet no definite deadlines with said law, rules and regulations requiring the
have been set by petitioner DENR as to petitioner- construction or installment of wastewater treatment
agencies timeframe for their respective duties; (4) as of facilities or hygienic septic tanks.
June 2010 there has been a change in leadership in both
the national and local levels; and (5) some agencies have The aforementioned governors and mayors shall submit to
encountered difficulties in complying with the Courts the DILG on or before December 31, 2011 their respective
directives. compliance reports which will contain the names and
addresses or offices of the owners of all the non-
In order to implement the afore-quoted Decision, certain complying factories, commercial establishments and
directives have to be issued by the Court to address the private homes, copy furnished the concerned
said concerns. environmental agency, be it the local DENR office or the
Laguna Lake Development Authority.
Acting on the recommendation of the Manila Bay Advisory
Committee, the Court hereby resolves to ORDER the The DILG is required to submit a five-year plan of action
following: that will contain measures intended to ensure compliance
of all non-complying factories, commercial establishments,
(1) The Department of Environment and Natural and private homes.
Resources (DENR), as lead agency in the Philippine
Clean Water Act of 2004, shall submit to the Court on or On or before June 30, 2011, the DILG and the mayors of
before June 30, 2011 the updated Operational Plan for the all cities in Metro Manila shall consider providing land for
Manila Bay Coastal Strategy. the wastewater facilities of the Metropolitan Waterworks
and Sewerage System (MWSS) or its concessionaires
The DENR is ordered to submit summarized data on the (Maynilad and Manila Water, Inc.) within their respective
overall quality of Manila Bay waters for all four quarters of jurisdictions.
2010 on or before June 30, 2011.
(3) The MWSS shall submit to the Court on or before June
The DENR is further ordered to submit the names and 30, 2011 the list of areas in Metro Manila, Rizal and Cavite
addresses of persons and companies in Metro Manila, that do not have the necessary wastewater treatment
Rizal, Laguna, Cavite, Bulacan, Pampanga and Bataan facilities. Within the same period, the concessionaires of
that generate toxic and hazardous waste on or before the MWSS shall submit their plans and projects for the
September 30, 2011. construction of wastewater treatment facilities in all the
aforesaid areas and the completion period for said
(2) On or before June 30, 2011, the Department of the facilities, which shall not go beyond 2037.
Interior and Local Government (DILG) shall order the
Mayors of all cities in Metro Manila; the Governors of On or before June 30, 2011, the MWSS is further required
Rizal, Laguna, Cavite, Bulacan, Pampanga and Bataan; to have its two concessionaires submit a report on the
and the Mayors of all the cities and towns in said amount collected as sewerage fees in their respective
provinces to inspect all factories, commercial areas of operation as of December 31, 2010.
establishments and private homes along the banks of the
major river systemssuch as but not limited to the Pasig- (4) The Local Water Utilities Administration is ordered to
Marikina-San Juan Rivers, the National Capital Region submit on or before September 30, 2011 its plan to
(Paranaque-Zapote, Las Pinas) Rivers, the Navotas- provide, install, operate and maintain sewerage and
Malabon-Tullahan-Tenejeros Rivers, the Meycauayan- sanitation facilities in said cities and towns and the
Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan) completion period for said works, which shall be fully
River, the Imus (Cavite) River, and the Laguna De Bay implemented by December 31, 2020.
and other minor rivers and waterways within their
jurisdiction that eventually discharge water into the Manila (5) The Department of Agriculture (DA), through the
Bay and the lands abutting it, to determine if they have Bureau of Fisheries and Aquatic Resources, shall submit
wastewater treatment facilities and/or hygienic septic to the Court on or before June 30, 2011 a report on areas
tanks, as prescribed by existing laws, ordinances, rules in Manila Bay where marine life has to be restored or
and regulations. Said local government unit (LGU) officials improved and the assistance it has extended to the LGUs
in Metro Manila, Rizal, Cavite, Laguna, Bulacan,
Law on NatRes (73-83 32

Pampanga and Bataan in developing the fisheries and encroachments established or built along the Pasig-
aquatic resources in Manila Bay. The report shall contain Marikina-San Juan Rivers, the NCR (Paraaque-Zapote,
monitoring data on the marine life in said areas. Within the Las Pias) Rivers, the Navotas-Malabon-Tullahan-
same period, it shall submit its five-year plan to restore Tenejeros Rivers, and connecting waterways and esteros,
and improve the marine life in Manila Bay, its future in violation of RA 7279 and other applicable laws. On or
activities to assist the aforementioned LGUs for that before June 30, 2011, the MMDA shall submit its plan for
purpose, and the completion period for said undertakings. the removal of said informal settlers and the demolition of
the aforesaid houses, structures, constructions and
The DA shall submit to the Court on or before September encroachments, as well as the completion dates for said
30, 2011 the baseline data as of September 30, 2010 on activities, which shall be fully implemented not later than
the pollution loading into the Manila Bay system from December 31, 2015.
agricultural and livestock sources.
The MMDA is ordered to submit a status report, within
(6) The Philippine Ports Authority (PPA) shall incorporate thirty (30) days from receipt of this Resolution, on the
in its quarterly reports the list of violators it has establishment of a sanitary landfill facility for Metro Manila
apprehended and the status of their cases. The PPA is in compliance with the standards under RA 9003 or the
further ordered to include in its report the names, make Ecological Solid Waste Management Act.
and capacity of the ships that dock in PPA ports. The PPA
shall submit to the Court on or before June 30, 2011 the On or before June 30, 2011, the MMDA shall submit a
measures it intends to undertake to implement its report of the location of open and controlled dumps in
compliance with paragraph 7 of the dispositive portion of Metro Manila whose operations are illegal after February
the MMDA Decision and the completion dates of such 21, 2006,3 pursuant to Secs. 36 and 37 of RA 9003, and
measures. its plan for the closure of these open and controlled dumps
to be accomplished not later than December 31, 2012.
The PPA should include in its report the activities of its Also, on or before June 30, 2011, the DENR Secretary, as
concessionaire that collects and disposes of the solid and Chairperson of the National Solid Waste Management
liquid wastes and other ship-generated wastes, which shall Commission (NSWMC), shall submit a report on the
state the names, make and capacity of the ships serviced location of all open and controlled dumps in Rizal, Cavite,
by it since August 2003 up to the present date, the dates Laguna, Bulacan, Pampanga and Bataan.
the ships docked at PPA ports, the number of days the
ship was at sea with the corresponding number of On or before June 30, 2011, the DENR Secretary, in his
passengers and crew per trip, the volume of solid, liquid capacity as NSWMC Chairperson, shall submit a report on
and other wastes collected from said ships, the treatment whether or not the following landfills strictly comply with
undertaken and the disposal site for said wastes. Secs. 41 and 42 of RA 9003 on the establishment and
operation of sanitary landfills, to wit:
(7) The Philippine National Police (PNP) Maritime Group
shall submit on or before June 30, 2011 its five-year plan National Capital Region
of action on the measures and activities it intends to
undertake to apprehend the violators of Republic Act No. 1. Navotas SLF (PhilEco), Brgy. Tanza (New Site),
(RA) 8550 or the Philippine Fisheries Code of 1998 and Navotas City
other pertinent laws, ordinances and regulations to prevent 2. Payatas Controlled Dumpsite, Barangay Payatas,
Quezon City
marine pollution in Manila Bay and to ensure the
Region III
successful prosecution of violators. 3. Sitio Coral, Brgy. Matictic, Norzagaray, Bulacan
4. Sitio Tiakad, Brgy. San Mateo, Norzagaray, Bulacan
The Philippine Coast Guard shall likewise submit on or 5. Brgy. Minuyan, San Jose del Monte City, Bulacan
before June 30, 2011 its five-year plan of action on the 6. Brgy. Mapalad, Santa Rosa, Nueva Ecija
measures and activities they intend to undertake to 7. Sub-zone Kalangitan, Clark Capas, Tarlac Special
apprehend the violators of Presidential Decree No. 979 or Economic Zone
Region IV-A
the Marine Pollution Decree of 1976 and RA 9993 or the
8. Kalayaan (Longos), Laguna
Philippine Coast Guard Law of 2009 and other pertinent 9. Brgy. Sto. Nino, San Pablo City, Laguna
laws and regulations to prevent marine pollution in Manila 10. Brgy. San Antonio (Pilotage SLF), San Pedro, Laguna
Bay and to ensure the successful prosecution of violators. 11. Morong, Rizal
12. Sitio Lukutan, Brgy. San Isidro, Rodriguez
(8) The Metropolitan Manila Development Authority (Montalban), Rizal (ISWIMS)
(MMDA) shall submit to the Court on or before June 30, 13. Brgy. Pintong Bukawe, San Mateo, Rizal (SMSLFDC)
2011 the names and addresses of the informal settlers in
Metro Manila who, as of December 31, 2010, own and On or before June 30, 2011, the MMDA and the seventeen
occupy houses, structures, constructions and other (17) LGUs in Metro Manila are ordered to jointly submit a
Law on NatRes (73-83 33

report on the average amount of garbage collected On or before June 30, 2011, the DepEd shall also submit
monthly per district in all the cities in Metro Manila from its plan of action to ensure compliance of all the schools
January 2009 up to December 31, 2010 vis--vis the under its supervision with respect to the integration of the
average amount of garbage disposed monthly in landfills aforementioned subjects in the school curricula which shall
and dumpsites. In its quarterly report for the last quarter of be fully implemented by June 30, 2012.
2010 and thereafter, MMDA shall report on the
apprehensions for violations of the penal provisions of RA (11) All the agencies are required to submit their quarterly
9003, RA 9275 and other laws on pollution for the said reports electronically using the forms below. The agencies
period. may add other key performance indicators that they have
identified. SO ORDERED.
On or before June 30, 2011, the DPWH and the LGUs in METROPOLITAN MANILA DEVELOPMENT
Rizal, Laguna, Cavite, Bulacan, Pampanga, and Bataan AUTHORITY, petitioner, vs. JANCOM
shall submit the names and addresses of the informal ENVIRONMENTAL CORPORATION and JANCOM
settlers in their respective areas who, as of September 30, INTERNATIONAL DEVELOPMENT PROJECTS PTY.
2010, own or occupy houses, structures, constructions, LIMITED OF AUSTRALIA, respondents; G.R. No.
and other encroachments built along the Meycauayan- 147465 January 30, 2002
Marilao-Obando (Bulacan) Rivers, the Talisay (Bataan)
River, the Imus (Cavite) River, the Laguna de Bay, and Before the Court is a petition for review on certiorari under
other rivers, connecting waterways and esteros that Rule 45 of the Rules of Civil Procedure filed by petitioner
discharge wastewater into the Manila Bay, in breach of RA Metropolitan Manila Development Authority (MMDA),
7279 and other applicable laws. On or before June 30, seeking to reverse and set aside the November 13, 2000
2011, the DPWH and the aforesaid LGUs shall jointly decision of the Court of Appeals declaring valid and
submit their plan for the removal of said informal settlers perfected the waste management contract entered into by
and the demolition of the aforesaid structures, the Republic of the Philippines, represented by the
constructions and encroachments, as well as the Secretary of National Resources and the Executive
completion dates for such activities which shall be Committee to oversee the build-operate-transfer
implemented not later than December 31, 2012. implementation of solid waste management projects, and
JANCOM Environmental Corporation.
(9) The Department of Health (DOH) shall submit to the
Court on or before June 30, 2011 the names and The pertinent facts are as follows:
addresses of the owners of septic and sludge companies
including those that do not have the proper facilities for the In 1994, then President Fidel V. Ramos issued
treatment and disposal of fecal sludge and sewage coming Presidential Memorandum Order No. 202 creating the
from septic tanks. Executive Committee (EXECOM) to oversee the BOT
implementation of solid waste management projects,
The DOH shall implement rules and regulations on headed by the Chairman of the MMDA and the Cabinet
Environmental Sanitation Clearances and shall require Officer for Regional Development-National Capital Region
companies to procure a license to operate from the DOH. (CORD-NCR). The EXECOM was to oversee and develop
waste-to-energy projects for the waste disposal sites in
The DOH and DENR-Environmental Management Bureau San Mateo, Rizal and Carmona, Cavite under the build-
shall develop a toxic and hazardous waste management operate-transfer (BOT) scheme. The terms of reference for
system by June 30, 2011 which will implement segregation the waste-to-energy projects provided that its proponents
of hospital/toxic/hazardous wastes and prevent mixing with should have the capability to establish municipal solid
municipal solid waste. waste thermal plants using incineration technology. This
type of technology was selected because of its alleged
On or before June 30, 2011, the DOH shall submit a plan advantages of greatly reduced waste volume, prolongation
of action to ensure that the said companies have proper of the service life of the disposal site, and generation of
disposal facilities and the completion dates of electricity.
compliance.1avvphi1
While eleven (11) proponents submitted their pre-
(10) The Department of Education (DepEd) shall submit to qualification documents, most failed to comply with the
the Court on or before May 31, 2011 a report on the requirements under Section 5.4 of the Implementing Rules
specific subjects on pollution prevention, waste and Regulations (IRR) of Republic Act No. 6957,
management, environmental protection, environmental otherwise known as the Build-Operate-Transfer Law. On
laws and the like that it has integrated into the school July 21, 1995, the Pre-qualification, Bids and Awards
curricula in all levels for the school year 2011-2012. Committee (PBAC) recommended the pre-qualification of
three proponents, namely: i) JANCOM International Pty.
Ltd.; ii) First Philippine International W-E Managers; and
Law on NatRes (73-83 34

iii) PACTECH Development Corporation. On July 26,


1995, the EXECOM approved the recommendation of the On December 19, 1997, the BOT Contract for the waste-
PBAC. On July 27, 1995, MMDA forwarded to the to-energy project was signed between JANCOM and the
Investment Coordinating Committee (ICC) Secretariat the Philippine Government, represented by the Presidential
pre-feasibility study on the privatization of the Carmona Task Force on Solid Waste Management through DENR
and San Mateo landfill sites. The project was later Secretary Victor Ramos, CORD-NCR Chairman Dionisio
presented to the ICC-Technical Board (ICC-TB) and then dela Serna, and MMDA Chairman Prospero Oreta.
endorsed to the ICC-Cabinet Committee (ICC-CC).
On March 5, 1998, the BOT contract was submitted to
On May 2, 1996, the PBAC conducted a pre-bid President Ramos for approval but this was too close to the
conference where it required the three pre-qualified end of his term which expired without him signing the
bidders to submit, within ninety (90) days, their bid contract. President Ramos, however, endorsed the
proposals. On August 2, 1996, JANCOM and First contract to incoming President Joseph E. Estrada.
Philippines requested for an extension of time to submit
their bids. PACTECH, on the other hand, withdrew from With the change of administration, the composition of the
the bidding. EXECOM also changed. Memorandum Order No. 19
appointed the Chairman of the Presidential Committee on
Subsequently, JANCOM entered into a partnership with Flagship Programs and Project to be the EXECOM
Asea Brown Boveri (ABB) to form JANCOM Environmental chairman. Too, Republic Act No. 8749, otherwise known
Corporation while First Philippines formed a partnership as the Clean Air Act of 1999, was passed by Congress.
with OGDEN. Due to the change in the composition of the And due to the clamor of residents of Rizal province,
proponents, particularly in their technology partners and President Estrada had, in the interim, also ordered the
contractors, the PBAC conducted a post pre-qualification closure of the San Mateo landfill. Due to these
evaluation. circumstances, the Greater Manila Solid Waste
Management Committee adopted a resolution not to
During the second bid conference, the bid proposals of pursue the BOT contract with JANCOM. Subsequently, in
First Philippines for the Carmona site and JANCOM for the a letter dated November 4, 1999, Roberto Aventajado,
San Mateo site were found to be complete and Chairman of the Presidential Committee on Flagship
responsive. Consequently, on February 12, 1997, Programs and Project informed Mr. Jay Alparslan,
JANCOM and First Philippines were declared the winning Chairman of JANCOM, that due to changes in policy and
bidders, respectively, for the San Mateo and the Carmona economic environment (Clean Air Act and non-availability
projects. of the San Mateo landfill), the implementation of the BOT
contract executed and signed between JANCOM and the
In a letter dated February 27, 1997, then MMDA Chairman Philippine Government would no longer be pursued. The
Prospero I. Oreta informed JANCOMs Chief Executive letter stated that other alternative implementation
Officer Jay Alparslan that the EXECOM had approved the arrangements for solid waste management for Metro
PBAC recommendation to award to JANCOM the San Manila would be considered instead.
Mateo Waste-to-Energy Project on the basis of the final
Evaluation Report declaring JANCOM International Ltd., JANCOM appealed to President Joseph Estrada the
Pty., together with Asea Brown Boveri (ABB), as the sole position taken by the EXECOM not to pursue the BOT
complying (winning) bidder for the San Mateo Waste Contract executed and signed between JANCOM and the
Disposal site, subject to negotiation and mutual approval Philippine Government, refuting the cited reasons for non-
of the terms and conditions of the contract of award. The implementation. Despite the pendency of the appeal,
letter also notified Alparslan that the EXECOM had MMDA, on February 22, 2000, caused the publication in a
created a negotiating team composed of Secretary newspaper of an invitation to pre-qualify and to submit
General Antonio Hidalgo of the Housing and Urban proposals for solid waste management projects for Metro
Development Coordinating Council, Director Ronald G. Manila. JANCOM thus filed with the Regional Trial Court of
Fontamillas, General Manager Roberto Nacianceno of Pasig a petition for certiorari to declare i) the resolution of
MMDA, and Atty. Eduardo Torres of the host local the Greater Metropolitan Manila Solid Waste Management
government unit to work out and finalize the contract Committee disregarding the BOT Contract and ii) the acts
award. Chairman Oreta requested JANCOM to submit to of MMDA calling for bids and authorizing a new contract
the EXECOM the composition of its own negotiating team. for Metro Manila waste management, as illegal,
unconstitutional, and void; and for prohibition to enjoin the
Thereafter, after a series of meetings and consultations Greater Metropolitan Manila Solid Waste Management
between the negotiating teams of EXECOM and Committee and MMDA from implementing the assailed
JANCOM, a draft BOT contract was prepared and resolution and disregarding the Award to, and the BOT
presented to the Presidential Task Force on Solid Waste contract with, JANCOM, and from making another award
Management.
Law on NatRes (73-83 35

in its place. On May 29, 2000, the trial court rendered a MMDAs motion for reconsideration of said decision having
decision, the dispositive portion of which reads: been denied, MMDA filed the instant petition, alleging that
the Court of Appeals gravely erred in finding that:
WHEREFORE, in view of the foregoing, the Court hereby
renders judgment in favor of petitioners JANCOM 1) There is a valid and binding contract between the
ENVIRONMENTAL CORPORATION, and JANCOM Republic of the Philippines and JANCOM given that: a) the
INTERNATIONAL DEVELOPMENT PROJECTS PTY., contract does not bear the signature of the President of
LIMITED OF AUSTRALIA, and against respondent the Philippines; b) the conditions precedent specified in
GREATER METROPOLITAN MANILA SOLID WASTE the contract were not complied with; and c) there was no
MANAGEMENT COMM., and HON. ROBERTO N. valid notice of award.
AVENTAJADO, in his Capacity as Chairman of the said
Committee, METRO MANILA DEVELOPMENT 2) The MMDA had not seasonably appealed the Decision
AUTHORITY and HON. JEJOMAR C. BINAY, in his of the lower court via a petition for certiorari.
capacity as Chairman of said Authority, declaring the
Resolution of respondent Greater Metropolitan Manila Before taking up the substantive issue in question, we
Solid Waste Management Committee disregarding shall first dispose of the question as to whether it is fatal to
petitioners BOT Award Contract and calling for bids for petitioners cause, that rather than appealing the trial
and authorizing a new contract for the Metro Manila waste courts decision to the Court of Appeals, it instead filed a
management ILLEGAL and VOID. petition for certiorari. While petitioner claims that the trial
courts decision never became final by virtue of its having
Moreover, respondents and their agents are hereby appealed by certiorari to the Court of Appeals, the trial
PROHIBITED and ENJOINED from implementing the court ruled that petitioners failure to file an appeal has
aforesaid Resolution and disregarding petitioners BOT made its decision final and executory. At bottom, the
Award Contract and from making another award in its question involves a determination of the propriety of
place. petitioners choice of the remedy of certiorari in
questioning the decision of the trial court.
Let it be emphasized that this Court is not preventing or
stopping the government from implementing infrastructure Section 1, Rule 65 of the 1997 Rules of Civil Procedure
projects as it is aware of the proscription under PD 1818. provides:
On the contrary, the Court is paving the way for the
necessary and modern solution to the perennial garbage Section 1. Petition for certiorari. When any tribunal,
problem that has been the major headache of the board or officer exercising judicial or quasi-judicial
government and in the process would serve to attract functions has acted without or in excess of its or his
more investors in the country. jurisdiction, or with grave abuse of discretion amounting to
lack or excess of jurisdiction, and there is no appeal, or
(Rollo,p. 159.) any plain, speedy, and adequate remedy in the ordinary
course of law, a person aggrieved thereby may file a
Instead of appealing the decision, MMDA filed a special verified petition in the proper court, alleging the facts with
civil action for certiorari with prayer for a temporary certainty and praying that judgment be rendered annulling
restraining order with the Court of Appeals which was later or modifying the proceedings of such tribunal, board or
docketed therein as CA-G.R. SP No. 59021. The appellate officer, and granting such incidental reliefs as law and
court not only required JANCOM to comment on the justice may require.
petition, it also granted MMDAs prayer for a temporary
restraining order. During the pendency of the petition for The petition shall be accompanied by a certified true copy
certiorari, JANCOM moved for the execution of the RTC of the judgment, order, or resolution subject thereof,
decision, which was opposed by MMDA. However, the copies of all pleadings and documents relevant and
RTC granted the motion for execution on the ground that pertinent thereto, and a sworn certification of non-forum
its decision had become final since MMDA had not shopping as provided in the third paragraph of section 3,
appealed the same to the Court of Appeals. MMDA moved Rule 46.
to declare respondents and the RTC judge in contempt of
court, alleging that the RTCs grant of execution was Plain it is from a reading of the above provision that
abuse of and interference with judicial rules and certiorari will lie only where a court has acted without or in
processes. excess of jurisdiction or with grave abuse of discretion. If
the court has jurisdiction over the subject matter and of the
On November 13, 2001, the Court of Appeals dismissed person, its rulings upon all questions involved are within its
the petition in CA-G.R. SP No. 59021 and a companion jurisdiction, however irregular or erroneous these may be,
case, CA-G.R. SP No. 60303. they cannot be corrected by certiorari. Correction may be
obtained only by an appeal from the final decision.
Law on NatRes (73-83 36

modification of the judgment on the merits is appeal. This


Verily, Section 1, Rule 41 of the 1997 Rules of Civil is true even if the error, or one of the errors, ascribed to
Procedure provides: the court rendering the judgment is its lack of jurisdiction
over the subject matter, or the exercise of power in excess
SEC. 1. Subject of appeal. An appeal may be taken thereof, or grave abuse of discretion in the findings of fact
from a judgment or final order that completely disposes of or of law set out in the decision. The existence and
the case or of a particular matter therein when declared by availability of the right of appeal proscribes a resort to
these Rules to be appealable. certiorari, because one of the requirements for availment
of the latter remedy is precisely that "there should be no
xxx xxx xxx appeal" (Mercado vs. CA, 162 SCRA 75 [1988]). As
incisively observed by the Court of Appeals:
In all the above instances where the judgment or final
order is not appealable, the aggrieved party may file an The special civil action for certiorari is available only when
appropriate special civil action under Rule 65. there is no appeal nor any plain, speedy and adequate
remedy in the ordinary course of law (Sec. 1, rule 65, id.)
There can be no dispute that the trial courts May 29, 2000
decision was a final order or judgment which MMDA Admittedly, appeal could have been taken from the
should have appealed, had it been so minded. In its assailed RTC decision. However, petitioners maintain that
decision, the trial court disposed of the main controversy appeal is not a speedy remedy because the RTC decision
by "declaring the Resolution of respondent Greater prohibiting them from conducting a bidding for a new
Metropolitan Manila Solid Waste Management Committee waste disposal project has adverse and serious effects on
disregarding petitioners BOT Award Contract and calling the citys garbage situation.
for bids for and authorizing a new contract for the Metro
Manila waste management ILLEGAL and VOID." This Nevertheless, the RTC decision is not immediately
ruling completely disposed of the controversy between executory. Only judgments in actions for injunction,
MMDA and JANCOM. In BA Finance Corporation vs. CA receivership, accounting and support and such other
(229 SCRA 5667 [1994]), we held that a "final" order or judgments as are now or may hereafter be declared to be
judgment is one which "disposes of the whole subject immediately executory shall be enforced after their
matter or terminates a particular proceeding or action, rendition and shall not be stayed by an appeal therefrom,
leaving nothing to be done but to enforce by execution unless otherwise ordered by the trial court (Sec. 4, rule 39,
what has been determined." An order or judgment is id.).
deemed final when it finally disposes of the pending action
so that nothing more can be done with it in the trial court. Since the RTC decision is not immediately executory,
In other words, a final order is that which gives an end to appeal would have stayed its execution. Consequently, the
the litigation. A final order or judgment finally disposes of, adverse effects of said decision will not visit upon
adjudicates, or determines the rights, or some right or petitioners during the appeal. In other words, appeal is a
rights of the parties, either on the entire controversy or on plain, speedy and adequate remedy in the ordinary course
some definite and separate branch thereof, and concludes of the law.
them until it is reversed or set aside. Where no issue is left
for future consideration, except the fact of compliance or But as no appeal was taken within the reglementary
non-compliance with the terms of the judgment or doer, period, the RTC decision had become final and executory.
such judgment or order is final and appealable Well-settled is the rule that the special civil action for
(Investments, Inc. vs. Court of Appeals, 147 SCRA 334 certiorari may not be invoked as a substitute for the
[1987]). remedy of appeal (BF Corporation vs. Court of Appeals,
288 SCRA 267). Therefore, the extraordinary remedy of
However, instead of appealing the decision, MMDA certiorari does not lie.
resorted to the extraordinary remedy of certiorari, as a
mode of obtaining reversal of the judgment. This cannot Moreover, petitioners instituted the instant action without
be done. The judgment was not in any sense null and void filing a motion for reconsideration of the RTC decision.
ab initio, incapable of producing any legal effects Doctrinal is the rule that certiorari will not lie unless a
whatever, which could be resisted at any time and in any motion for reconsideration is first filed before the
court it was attempted. It was a judgment which could or respondent tribunal to allow it an opportunity to correct its
may have suffered from some substantial error in errors (Zapanta vs. NLRC, 292 SCRA 580).
procedure or in findings of fact or of law, and on that
account, it could have been reversed or modified on (Rollo, p. 47-48.)
appeal. But since it was not appealed, it became final and
has thus gone beyond the reach of any court to modify in Admittedly, there are instances where the extraordinary
any substantive aspect. The remedy to obtain reversal or remedy of certiorari may be resorted to despite the
Law on NatRes (73-83 37

availability of an appeal. In Ruiz, Jr. vs. Court of Appeals extinguishment thereof (Bugatti vs. CA, 343 SCRA 335
(220 SCRA 490 [1993]), we held: [2000]). Article 1315 of the Civil Code, provides that a
contract is perfected by mere consent. Consent, on the
Considered extraordinary, [certiorari] is made available other hand, is manifested by the meeting of the offer and
only when there is no appeal, nor any plain, speedy or the acceptance upon the thing and the cause which are to
adequate remedy in the ordinary course of the law (Rule constitute the contract (See Article 1319, Civil Code). In
65, Rules of Court, Section 1). The long line of decisions the case at bar, the signing and execution of the contract
denying the petition for certiorari, either before appeal was by the parties clearly show that, as between the parties,
availed or specially in instances where the appeal period there was a concurrence of offer and acceptance with
has lapsed, far outnumbers the instances when certiorari respect to the material details of the contract, thereby
was given due course. The few significant exceptions giving rise to the perfection of the contract. The execution
were: when public welfare and the advancement of public and signing of the contract is not disputed by the parties.
policy dictate; or when the broader interests of justice so As the Court of Appeals aptly held:
require, or when the writs issued are null . . . or when the
questioned order amounts to an oppressive exercise of [C]ontrary to petitioners insistence that there was no
judicial authority. perfected contract, the meeting of the offer and
acceptance upon the thing and the cause, which are to
In the instant case, however, MMDA has not sufficiently constitute the contract (Arts. 1315 and 1319, New Civil
established the existence of any fact or reason to justify its Code), is borne out by the records.
resort to the extraordinary remedy of certiorari. Neither
does the record show that the instant case, indeed, falls Admittedly, when petitioners accepted private
under any of the exceptions aforementioned. respondents bid proposal (offer), there was, in effect, a
meeting of the minds upon the object (waste management
The Court thus holds that the Court of Appeals did not err project) and the cause (BOT scheme). Hence, the
in declaring that the trial courts decision has become final perfection of the contract. In City of Cebu vs. Heirs of
due to the failure of MMDA to perfect an appeal within the Candido Rubi (306 SCRA 108), the Supreme Court held
reglementary period. that "the effect of an unqualified acceptance of the offer or
proposal of the bidder is to perfect a contract, upon notice
With the foregoing disquisition, it would appear of the award to the bidder.
unnecessarily to discuss and resolve the substantive issue
posed before the Court. However, the procedural flaw (Rollo, p. 48-49.)
notwithstanding, the Court deems it judicious to take
cognizance of the substantive question, if only to put In fact, in asserting that there is no valid and binding
petitioners mind to rest. contract between the parties, MMDA can only allege that
there was no valid notice of award; that the contract does
In its second assignment of errors, petitioner MMDA not bear the signature of the President of the Philippines;
contends that there is no valid and binding contract and that the conditions precedent specified in the contract
between the Republic of the Philippines and respondents were not complied with.
because: a) the BOT contract does not bear the signature
of the President of the Philippines; b) the conditions In asserting that the notice of award to JANCOM is not a
precedent specified in the contract were not complied with; proper notice of award, MMDA points to the Implementing
and that c) there was no valid notice of award. Rules and Regulations of Republic Act No. 6957,
otherwise known as the BOT Law, which require that i)
These contentions hold no water. prior to the notice of award, an Investment Coordinating
Committee clearance must first be obtained; and ii) the
Under Article 1305 of the Civil Code, "[a] contract is a notice of award indicate the time within which the awardee
meeting of minds between two persons whereby one binds shall submit the prescribed performance security, proof of
himself, with respect to the other, to give something or to commitment of equity contributions and indications of
render some service." A contract undergoes three distinct financing resources.
stages preparation or negotiation, its perfection, and
finally, its consummation. Negotiation begins from the time Admittedly, the notice of award has not complied with
the prospective contracting parties manifest their interest these requirements. However, the defect was cured by the
in the contract and ends at the moment of agreement of subsequent execution of the contract entered into and
the parties. The perfection or birth of the contract takes signed by authorized representatives of the parties; hence,
place when the parties agree upon the essential elements it may not be gainsaid that there is a perfected contract
of the contract. The last stage is the consummation of the existing between the parties giving to them certain rights
contract wherein the parties fulfill or perform the terms and obligations (conditions precedents) in accordance with
agreed upon in the contract, culminating in the
Law on NatRes (73-83 38

the terms and conditions thereof. We borrow the words of enter into any waste management project for and in behalf
the Court of Appeals: of the Government. Secondly, Section 59 of Executive
Order No. 292 is relied upon as authority for the
Petitioners belabor the point that there was no valid notice proposition that presidential approval is necessary for the
of award as to constitute acceptance of private validity of the contract.
respondents offer. They maintain that former MMDA
Chairman Oretas letter to JANCOM EC dated February The first argument conveniently overlooks the fact that
27, 1997 cannot be considered as a valid notice of award then Secretary of Environment and Natural Resources
as it does not comply with the rules implementing Rep. Act Victor Ramos was likewise a signatory to the contract.
No. 6957, as amended. The argument is untenable. While dela Serna and Oreta may not have had any
authority to sign, the Secretary of Environment and Natural
The fact that Chairman Oretas letter informed JANCOM Resources has such an authority. In fact, the authority of
EC that it was the "sole complying (winning) bidder for the the signatories to the contract was not denied by the
San Mateo project leads to no other conclusion than that Solicitor General. Moreover, as observed by the Court of
the project was being awarded to it. But assuming that Appeals, "[i]t was not alleged, much less shown, that those
said notice of award did not comply with the legal who signed in behalf of the Republic had acted beyond the
requirements, private respondents cannot be faulted scope of their authority."
therefore as it was the government representatives duty to
issue the proper notice. In truth, the argument raised by MMDA does not focus on
the lack of authority of the signatories, but on the amount
In any event, petitioners, as successors of those who involved as placing the contract beyond the authority of
previously acted for the government (Chairman Oreta, et the signatories to approve. Section 59 of Executive Order
al), are estopped from assailing the validity of the notice of No. 292 reads:
award issued by the latter. As private respondents
correctly observed, in negotiating on the terms and Section 59. Contracts for Approval by the President.
conditions of the BOT contract and eventually signing said Contracts for infrastructure projects, including contracts for
contract, the government had led private respondents to the supply of materials and equipment to be used in said
believe that the notice of award given to them satisfied all projects, which involve amounts above the ceilings
the requirement of the law. provided in the preceding section shall be approved by the
President: Provided, That the President may, when
While the government cannot be estopped by the conditions so warrant, and upon recommendation of the
erroneous acts of its agents, nevertheless, petitioners may National Economic and Development Authority, revise the
not now assail the validity of the subject notice of award to aforesaid ceilings of approving authority.
the prejudice of private respondents. Until the institution of
the original action before the RTC, invalidity of the notice However, the Court of Appeals trenchantly observed in
of award was never invoked as a ground for termination of this connection:
the BOT contract. In fact, the reasons cited for terminating
the San Mateo project, per Chairman Aventajados letter to As regards the Presidents approval of infrastructure
JANCOM EC dated November 4, 1999, were its purported projects required under Section 59 of Executive Order No.
non-implementability and non-viability on account of 292, said section does not apply to the BOT contract in
supervening events, e.g., passage of the Clean Air Act, question. Sec. 59 should be correlated with Sec. 58 of
etc. Exec. Order No. 292. Said sections read:

(Rollo, p. 49-50.) SECTION 58. Ceiling for Infrastructure Contracts. The


following shall be the ceilings for all civil works,
MMDA also points to the absence of the Presidents construction and other contracts for infrastructure projects,
signature as proof that the same has not yet been including supply contracts for said projects, awarded
perfected. Not only that, the authority of the signatories to through public bidding or through negotiation, which may
bind the Republic has even been put to question. Firstly, it be approved by the Secretaries of Public Works and
is pointed out that Memorandum Order No. 202 creating Highways, Transportation and Communications, Local
the Executive Committee to oversee the BOT Government with respect to Rural Road improvement
implementation of solid waste management projects only Project and governing boards of government-owned or
charged the officials thereof with the duty of controlled corporations:
recommending to the President the specific project to be
implemented under the BOT scheme for both San Mateo xxx xxx xxx
and Carmona sites. Hence, it is concluded that the
signatories, CORD-NCR Chairman Dionisio dela Serna Save as provided for above, the approval ceilings
and MMDA Chairman Prospero Oreta, had no authority to assigned to the departments/agencies involved in national
Law on NatRes (73-83 39

infrastructure and construction projects shall remain at the As to the contention that there is no perfected contract due
levels provided in existing laws, rules and regulations. to JANCOMs failure to comply with several conditions
precedent, the same is, likewise, unmeritorious. Article 18
Contrary to petitioners claim that all infrastructure of the BOT contract reads:
contracts require the Presidents approval (Petition, p. 16),
Sec. 59 provides that such approval is required only in ARTICLE 18
infrastructure contracts involving amounts exceeding the CONDITIONS PRECEDENT
ceilings set in Sec. 58. Significantly, the infrastructure
contracts treated in Sec. 58 pertain only to those which xxx
may be approved by the Secretaries of Public Works and
Highways, Transportation and Communications, Local 18.2.1. The BOT COMPANY hereby undertakes to provide
Government (with respect to Rural Road Improvement the following within 2 months from execution of this
Project) and the governing boards of certain government- Contract as an effective document:
owned or controlled corporations. Consequently, the BOT
contract in question, which was approved by the DENR a) sufficient proof of the actual equity contributions from
Secretary and the EXCOM Chairman and Co-Chairman, is the proposed shareholders of the BOT COMPANY in a
not covered by Exec. Order No. 292. total amount not less than PHP500,000,000 in accordance
with the BOT Law and the implementing rules and
(Rollo, p. 51-52.) regulations;

The provision pertinent to the authority of the Secretary of b) sufficient proof of financial commitment from a lending
Environment and Natural Resources would actually be institution sufficient to cover total project cost in
Section 1 of Executive Order No. 380, Series of 1989 accordance with the BOT Law and the implementing rules
which provides that "The Secretaries of all Departments and regulations;
and Governing Boards of government-owned or controlled
corporations [except the Secretaries of Public Works and c) to support its obligation under this Contract, the BOT
Highways, Transportation and Communication, and Local COMPANY shall submit a security bond to the CLIENT in
Government with respect to Rural Road Improvement accordance with the form and amount required under the
projects] can enter into publicly bidded contracts BOT Law.
regardless of amount (See also Section 515, Government
Accounting and Auditing Manual Volume I)." xxx
Consequently, MMDA may not claim that the BOT contract
is not valid and binding due to the lack of presidential 18.2.3 Completion of Documentary Requirements as per
approval. Schedule 4 by the BOT Company

Significantly, the contract itself provides that the signature As clearly stated in Article 18, JANCOM undertook to
of the President is necessary only for its effectivity (not comply with the stated conditions within 2 months from
perfection), pursuant to Article 19 of the contract, which execution of the Contract as an effective document. Since
reads: the President of the Philippines has not yet affixed his
signature on the contract, the same has not yet become
This contract shall become effective upon approval by the an effective document. Thus, the two-month period within
President of the Republic of the Philippines pursuant to which JANCOM should comply with the conditions has not
existing laws subject to the condition, precedent in Article yet started to run. It cannot thus be said that JANCOM has
18. This contract shall remain in full force and effect for already failed to comply with the "conditions precedent"
twenty-five (25) years subject to renewal for another mandated by the contract. By arguing that "failure [of
twenty-five (25) years from the date of Effectivity. Such JANCOM] to comply with the conditions results in the
renewal will be subject to mutual agreement of the parties failure of a contract or prevents the judicial relation from
and approval of the President of the Republic of the coming into existence," MMDA reads into the contract
Philippines. something which is not contemplated by the parties. If the
terms of a contract are clear and leave no doubt upon the
(Rollo, p. 94.) intention of the contracting parties, the literal meaning of
its stipulations shall control (Art. 1370, Civil Code).
Stated differently, while the twenty-five year effectivity
period of the contract has not yet started to run because of We, therefore, hold that the Court of Appeals did not err
the absence of the Presidents signature, the contract has, when it declared the existence of a valid and perfected
nonetheless, already been perfected. contract between the Republic of the Philippines and
JANCOM. There being a perfected contract, MMDA
cannot revoke or renounce the same without the consent
Law on NatRes (73-83 40

of the other. From the moment of perfection, the parties circumstance cannot, by itself, abrogate the entire
are bound not only to the fulfillment of what has been agreement.1wphi1
expressly stipulated but also to all the consequences
which, according to their nature, may be in keeping with Doctrinal is the rule that neither the law nor the courts will
good faith, usage, and law (Article 1315, Civil Code). The extricate a party from an unwise or undesirable contract,
contract has the force of law between the parties and they or stipulation for that matter, he or she entered into with
are expected to abide in good faith by their respective full awareness of its consequences (Opulencia vs. CA,
contractual commitments, not weasel out of them. Just as 293 SCRA 385). Indeed, the terms and conditions of the
nobody can be forced to enter into a contract, in the same subject contract were arrived at after due negotiations
manner, once a contract is entered into, no party can between the parties thereto.
renounce it unilaterally or without the consent of the other.
It is a general principle of law that no one may be (Rollo, p. 54.)
permitted to change his mind or disavow and go back
upon his own acts, or to proceed contrary thereto, to the WHEREFORE, premises considered, the petition is
prejudice of the other party. Nonetheless, it has to be hereby DISMISSED for lack of merit and the decision of
repeated that although the contract is a perfected one, it is the Court of Appeals in CA-G.R. SP No. 59021 dated
still ineffective or unimplementable until and unless it is November 13, 2001 AFFIRMED. No costs.SO ORDERED.
approved by the President. DONALD MEAD, petitioner, vs. HON. MANUEL A.
ARGEL in his capacity as Presiding Judge in the Court
Moreover, if after a perfected and binding contract has of First Instance of Rizal, Branch XXXV and the
been executed between the parties, it occurs to one of PEOPLE OF THE PHILIPPINES, respondents.; G.R. No.
them to allege some defect therein as reason for annulling L-41958 July 20, 1982
it, the alleged defect must be conclusively proven, since
the validity and the fulfillment of contracts cannot be left to The issue posed for determination in this case is whether
the will of one of the contracting parties. In the case at bar, or not a Provincial Fiscal has the authority to file an
the reasons cited by MMDA for not pushing through with information for a violation of Republic Act No. 3931,
the subject contract were: 1) the passage of the Clean Air entitled "An Act Creating a National Water and Air
Act, which allegedly bans incineration; 2) the closure of the Pollution Control Commission."
San Mateo landfill site; and 3) the costly tipping fee. These
reasons are bereft of merit On March 11, 1975, petitioner Donald Mead and a certain
Isaac Arivas were charged by the Provincial Fiscal of Rizal
Once again, we make reference to the insightful with a violation of Section 9, in relation to Section 10 of
declarations of the Court of Appeals: Republic Act No. 3931, under an information reading as
follows:
Sec. 20 of the Clean Air Act pertinently reads:
That on or about the 23rd day of August, 1972, and for
SECTION 20. Ban on Incineration. Incineration, hereby some time prior and subsequent thereto, in the
defined as the burning of municipal, bio-chemical and municipality of Malabon, province of Rizal, Philippines and
hazardous wastes, which process emits poisonous and within the jurisdiction of this Honorable Court, the above-
toxic fumes, is hereby prohibited: x x x." named accused, being then the president and the general
manager, respectively, of the Insular Oil Refinery Co.
Section 20 does not absolutely prohibit incineration as a (INSOIL) a corporation duly organized in accordance with
mode of waste disposal; rather only those burning existing laws, conspiring and confederating together and
processes which emit poisonous and toxic fumes are mutually helping and aiding one another, did then and
banned. there willfully, unlawfully and feloniously drain or otherwise
dispose into the highway canal and/or cause, permit,
As regards the projected closure of the San Mateo landfill suffer to be drained or allow to seep into such waterway
vis--vis the implementability of the contract, Art. 2.3 the industrial and other waste matters discharged due to
thereof expressly states that "[i]n the event the project Site the operation of the said Insular Oil Refinery Co. so
is not delivered x x x, the Presidential task Force on Solid managed and operated by them, thereby causing pollution
Waste Management (PTFSWM) and the Client, shall of such waterway with the resulting damage and/or
provide within a reasonable period of time, a suitable destruction to the living plants in the vicinity and providing
alternative acceptable to the BOT COMPANY." hazard to health and property in the same vicinity.

With respect to the alleged financial non-viability of the The case was docketed as Criminal Case No. C-5984-75
project because the MMDA and the local government units and it was subsequently assigned to Branch XXXV of the
cannot afford the tipping fees under the contract, this Court of First Instance of Rizal (Caloocan City) presided
over by the respondent Judge.
Law on NatRes (73-83 41

There is no disputing the validity and wisdom of the rule


On August 11, 1975, petitioner Donald Mead, one of the invoked by the respondents. However, it is also
accused in the criminal case, filed a motion to quash on recognized that, under certain situations, recourse to the
the grounds that the trial court has no jurisdiction and that extraordinary legal remedies of certiorari, prohibition or
the Provincial Fiscal of Rizal has no legal personality to file mandamus to question the denial of a motion to quash is
the above-quoted information. The motion to quash was considered proper in the interest of "more enlightened and
denied by the respondent Judge in an Order dated substantial justice", as was so declared in "Yap vs.
September 5, 1975. A Motion For Reconsideration filed by Lutero", G.R. No. L-12669, April 30, 1969, 105 Phil. 3007:
the petitioner was also denied by the respondent Judge in
his Order of November 10, 1965. Hence, this petition for However, were we to require adherence to this pretense,
certiorari with preliminary injunction to annul the said the case at bar would have to be dismissed and petitioner
orders of the respondent Judge who allegedly acted in required to go through the inconvenience, not to say the
excess of or without jurisdiction in issuing the same. mental agony and torture, of submitting himself to trial on
the merits in Case No. 16443, apart from the expenses
In Our Resolution dated November 28, 1975, the incidental thereto, despite the fact that his trial and
respondents were required to comment on the petition and conviction therein would violate one of this constitutional
a temporary restraining order was issued to enjoin the rights, and that, an appeal to this Court, we would,
respondent Judge from enforcing his questioned orders therefore, have to set aside the judgment of conviction of
until otherwise directed by this Court. the lower court. This would, obviously, be most unfair and
unjust. Under the circumstances obtaining in the present
It is the principal contention of the petitioner that the case, the flaw in the procedure followed by petitioner
National Water and Air Pollution Control Commission herein may be overlooked, in the interest of a more
(hereinafter referred to as the "Commission") as created enlightened and substantial justice.
under Republic Act No. 3931 has the exclusive authority to
determine the existence of "pollution" before a criminal To the same effect is the pronouncement in "Pineda and
case can be filed for a violation of the said law; and that it Ampil Manufacturing Co., vs. Bartolome, et al.," 95 Phil.,
has the exclusive authority to prosecute violations of the 930938, expressed as follows:
same. Petitioner further avers that the Commission not
having finally ruled that the petitioner has violated While a denial of a motion to dismiss for lack of jurisdiction
Republic Act No. 3931, the Provincial Fiscal of Rizal lacks was held not to be a proper basis for a petition for
the authority to prosecute the petitioner for a violation of certiorari [Nico vs. Blanco, 46 Off. Gaz., Supp. (1) 88; 81
said law. Phil., 2131, or an appeal not certiorari is the proper
remedy for correcting an error which a lower court may
The respondents, on the other hand, maintain that while commit in denying a motion to set aside a judgment, or in
Republic Act No. 3931 grants the power and duty to the setting aside an order of dismissal, [Rios vs. Ros et al., 45
Commission to investigate and prosecute violations of Off. Gaz. (No. 3), 1265; 79 Phil. 243; Santos vs. Pecson,
Republic Act No. 3931, such grant of power and authority 45 Off. Gaz. (No. 3), 1278; 79 Phil.754] however, in some
is not exclusive, and does not deprive fiscals and other instances, the Supreme Court has departed from the
public prosecutors of their authority to investigate and general rule and has entertained the writ notwithstanding
prosecute violations of the said law committed within their the existence of an appeal. Thus, in one case the
respective jurisdictions. Supreme Court took cognizance of a petition for certiorari
notwithstanding the fact that the accused could have
Before discussing the main issue on its merits, We deem it appealed in due time when it found that the action was
necessary to resolve a procedural question raised by the necessary to promote public welfare and public policy
respondents in support of their prayer that the instant (People vs. Zulueta, 89 Phil. 880). In another case, a
petition should not be entertained. Respondents advert to petition for certiorari to annul an order of the trial judge
the rule that when a motion to quash filed by an accused admitting an amended information was entertained
in a criminal case shall be denied, the remedy of the although the accused had an adequate remedy by appeal
accused- movant is not to file a petition for certiorari or "inasmuch as the Surplus Property cases have attracted
mandamus or prohibition, the proper recourse being to go nationwide attention, making it essential to proceed with
to trial, without prejudice to his right to reiterate the dispatch in the consideration thereof. (People vs, Zulueta,
grounds invoked in his motion to quash if an adverse supra. Citing Arevalo vs. Nepomuceno, 63 Phil., 627.) And
judgment is rendered against him, in the appeal that he still in another case, the writ was entertained where the
may take therefrom in the manner authorized by law. (Mill appeal was found not to be adequate remedy, as where
vs. People, et al., 101 Phil. 599; Echarol us. Purisima, et the order which is sought to be reviewed is merely of
al, 13 SCRA 309.) interlocutory or peremptory character, and the appeal
therefrom can be interposed only after final judgment and
may therefore be of no avail. (Rocha vs. Crossfield, 6
Law on NatRes (73-83 42

Phil., 355; Leung Ben vs. O'Brien, 38 Phil., 182. See also judge or court is proceeding in excess or outside of its
Mendoza vs. Parungao, 49 Phil., 271; Dais vs. Court of jurisdiction, the remedy of prohibition would lie since it
First Instance, 51 Phil., 36). would be useless and a waste of time to go ahead with the
proceedings. (Philippine International Fair, Inc., et al., vs.
For analogous reasons it may be said that the petition for Ibanez, et al, 50 Off. Gaz. 1036; Enrique vs. Macadaeg, et
certiorari interposed by the accused against the order of all 47 Off. Gaz. 1207; see also San Beda College vs. CIR,
the court a quo denying the motion to quash may be 51 Off. Gaz. 5636.) (University of Sto. Tomas vs.
entertained, not only because it was rendered in a criminal Villanueva, L-13748, 30 October 1959.) (Time, Inc. vs.
case, but because it was rendered, as claimed, with grave Reyes, 39 SCRA, pp. 315-316.)
abuse of discretion, as found by the Court of Appeals, it
would be indeed unfair and unjust, if not derogatory of An additional factor that induced Us to entertain the instant
their constitutional right, to force the accused to go to trial petition is the obvious merit We find in the same. Our
under an information which, in their opinion, as was found, reading of the provisions of Republic Act No. 3931 has
accuses them of multiple offenses in contravention of law. convinced Us that the clear legislative intention is to vest
And so, in our opinion, the respondent court did not err in in the Commission the exclusive authority to determine the
entertaining the petition for certiorari instead of dismissing existence of "pollution" penalized thereunder and to
it, as claimed. prosecute violations of said law.

The motion to quash filed by the accused in Yap vs. Lutero The information filed against the herein petitioner charges
was on the ground of double jeopardy. In Pineda vs. him with a violation of Section 9, in relation to Section 10
Bartolome, the ground invoked was duplicity of offenses of Republic Act No. 3931. More specifically, it alleges that
charged in the information. In the case at bar, the the petitioner, with his co-accused Isaac Arivas, "willfully,
petitioner assails the very jurisdiction of the court wherein unlawfully and feloniously drain or otherwise dispose into
the criminal case was filed, Certainly, there is a more the highway canal and/or cause, permit, suffer to be
compelling reason that such issue be resolved soonest, in drained or allow to seep into such waterway the industrial
order to avoid the court's spending precious time and and other waste matters discharged due to the operation
energy unnecessarily in trying and deciding the case, and of the said Insular Oil Refinery Co. so managed and
to spare the accused from the inconvenience, anxiety and operated by them, thereby causing pollution of such
embarrassment, let alone the expenditure of effort and waterway with the resulting damage and/or destruction to
money, in undergoing trial for a case the proceedings in the arriving plants in the vicinity and providing hazard to
which could possibly be annuled for want of jurisdiction. health and property in the same vicinity."
Even in civil actions, We have counselled that when the
court's jurisdiction is attacked in a motion to dismiss, it is Section 9 in its first paragraph, supposedly the criminal act
the duty of the court to resolve the same as soon as being imputed to the petitioner, reads as follows:
possible in order to avoid the unwholesome consequences
mentioned above. SEC. 9. Prohibitions. No person shall throw, run, drain,
or otherwise dispose into any of the water and/or
It is also advanced that the present petition is premature, atmospheric air of the Philippines, or cause, permit, suffer
since respondent court has not definitely ruled on the to be thrown, run, drain, allow to see or otherwise dispose
motion to dismiss, nor held that it has jurisdiction, but only into such waters or atmospheric air, any organic or
argument is untenable. The motion to dismiss was inorganic matter or any substance in gaseous or liquid
predicated on the respondent court's lack of jurisdiction to form that shall cause pollution of such waters or
entertain the action, and the rulings of this Court are that atmospheric air.
writs of certiorari or prohibition, or both, may issue in case
of a denial or deferment of action on such a motion to It will be noted from the above-quoted provision that the
dismiss for lack of jurisdiction. prohibited act is to throw, run, drain or otherwise dispose
into any of the water and/or atmospheric air of the
If the question of jurisdiction were not the main ground for Philippines, any organic or inorganic matter or substance
this petition for review by certiorari, it would be premature "that shall cause pollution of such waters or atmospheric
because it seeks to have a review of an interlocutory air." Stated in simpler terms, the offense allegedly
order. But as it would be useless and futile to go ahead committed by the petitioner was the act of causing
with the proceedings if the court below had no jurisdiction pollution of a waterway (highway canal).
this petition was given due course.' (San Beda vs. CIA 51
O.G. 6636, 5638). The term "pollution" as used in the law is not to be taken in
its ordinary signification. In Section 2, paragraph (a), of
While it is true that action on a motion to dismiss may be Republic Act No. 3931, "pollution" is defined in these
deferred until the trial and an order to that effect is words:
interlocutory, still where it clearly appears that the trial
Law on NatRes (73-83 43

(a) Pollution' means such alteration of the physical, be discontinued unless adequate sewage works or
chemical and/or biological properties of any water and/or industrial wastes disposal system be properly operated to
atmospheric air of the Philippines, or any such discharge prevent further damage or pollution.
of any liquid, gaseous or solid substance into any of the
waters and/or atmospheric air of the country as will or is No investigation being conducted or ruling made by the
likely to create or render such waters and/or atmospheric Commission shall prejudice any action which may be filed
air harmful or detrimental or injurious to public health, in court by any person in accordance with the provisions of
safety or welfare, or to domestic, commercial, industrial, the New Civil Code on nuisance. On matters, however, not
agricultural, recreational or other legitimate uses, or to related to nuisance, no court action shall be initiated until
livestock, wild animals, birds, fish or of her aquatic life. the Commission shall have finally ruled thereon and no
order of the Commission discontinuing the discharge of
The power to determine the existence of pollution is waste shall be stayed by the filing of said court action,
vested by the law in the Commission. Section 6, among unless the court issues an injunction as provided for in the
others, gives the Commission the authority to "determine Rules of Court.
whether a pollution exists in any of the waters and/or
atmospheric air of the Philippines." (Section 6(a), No. 1); to The last paragraph of the above-quoted provision
"hold public hearings, ... make findings of facts and delineates the authority to be exercised by the
determinations all with respect to the violations of this Act Commission and by the ordinary courts in respect of
or orders issued by the Commission." (Ibid., No. 3); to preventing or remedying the pollution of the waters or
"institute or cause to be instituted in the court of competent atmospheric air of the Philippines. The provision excludes
jurisdiction legal proceedings to compel compliance with from the authority of the Commission only the
the provisions of this Act" (Ibid, No. 5); and, "after due determination of and the filing of court actions involving
notice and hearing, revoke, suspend or modify any permit violations of the New Civil Code on nuisance. It is
issued under this Act whenever modifications are expressly directed that on matters not related to nuisance
necessary to prevent or abate pollution of any water "no court action shall be initiated until the Commission
and/or atmospheric air of the Philippines." (Ibid., No. 7.) shall have finally ruled thereon." This provision leaves little
Section 8 contains explicit provisions as to the authority of room for doubt that a court action involving the
the Commission to determine the existence of pollution determination of the existence of pollution may not be
and to take appropriate court actions to abate or prevent initiated until and unless the Commission has so
the same. It provides: determined the existence of what in the law is considered
pollution.
SEC. 8. Proceedings before the Commission . The
Commission may, on its own motion, or upon the request It may not be argued that the above-cited provision refers
of any person, investigate or may inquire, in a manner to only to the filing of civil actions, and not to criminal cases
be determined by it, as to any alleged act of pollution or as is the one herein involved, there being no basis either
the omission or failure to comply with any provisions of this in the context in law nor from a consideration of the
Act or any order of this Commission. purpose behind the enactment of the same upon which
such a distinction may be made. Indeed, respondents do
Whenever it appears to the Commission, after not seriously question that the court action contemplated
investigation, that there has been a violation of any of the in the last paragraph of Section 8 includes criminal
provisions of this Act or any order of the Commission, it proceedings. Respondents merely aver that the
may order whoever causes such violation to show cause aforementioned grant of authority to the Commission is not
before said Commission why such discharge of industrial exclusive of the power of Fiscals to file criminal actions for
wastes or any waste should not be discontinued. A notice a violation of the provisions of Republic Act No. 3931.
shall be served on the offending party directing him or it to
show cause before the Commission, on a date specified in We are likewise not in accord with the view that the law
such notice, why an order should not be made directing intended to give concurrent authority to the Commission
the discontinuance of such violation. Such notice shall and Fiscals to prosecute violations of Republic Act No.
specify the time and the place where a public hearing will 3931. It is true that there is no provision expressly
be held by the Commission or its authorized declaring that the authority vested in the Commission to
representatives, and notice of such hearing shall be prosecute violations of Republic Act No. 3931 is exclusive.
served personally or by registered mail, at least ten days Using the same logic, there is neither a provision declaring
before said hearing; and in the case of a municipality or such authority to be concurrent or may be exercised jointly
corporation such notice shall be served upon the major or with Fiscals. The absence of an explicit declaration as to
president thereof. The Commission shall take evidence the exclusive authority of the Commission to prosecute
with reference to said matter and may issue an order to violations of the subject law does not detract from the clear
the party responsible for such violation, directing that intention to make it so, as gathered from the philosophy of
within a specified period of time thereafter, such violation the law itself and as gleaned from several provisions of the
Law on NatRes (73-83 44

same. It is clearly deducible from the provision of Section control the city fiscal in the prosecutions of the violations of
8 expressly declaring that no court action shall be initiated, the Anti-Dummy Law. (Rollo, p. 118; 5 SCRA 428,433.)
except those related to nuisance, until the Commission
shall have finally ruled on the alleged act of pollution; and In R. B. Industrial Development Co., Ltd. vs. Enage (24
also from Section 6(a), No. 5, which authorizes the SCRA 365) involving the authority of the Bureau of
Commission to "initiate or cause to be instituted in a court Forestry over the management and use of public forests
of competent jurisdiction legal proceedings to compel and the transfer of licenses for the taking of forest
compliance with the provisions of this Act." products, this Court has made this pronouncement:

As may be seen from the law, the determination of the A doctrine long recognized is that where the law confines
existence of pollution requires investigation, public in an administrative office the power to determine
hearings and the collection of various information relating particular questions or matters, upon the facts to be
to water and atmospheric pollution. (Sections 6, 7, and 8.) presented, the jurisdiction of such office shall prevail over
The definition of the term "pollution" in itself connotes that the courts. (p. 124, Rollo.)
the determination of its existence requires specialized
knowledge of technical and scientific matters which are not It is our considered view that the Provincial Fiscal of Rizal
ordinarily within the competence of Fiscals or of those lacked the authority to file the information charging the
sitting in a court of justice. It is undoubtedly in recognition petitioner with a violation of the provisions of Republic Act
of this fact that in Section 4 of the law, it is provided that No. 3931 there being no prior finding or determination by
"the basic personnel necessary to carry out the provisions the Commission that the act of the petitioner had caused
of this Act shall be engineers, chemists, biochemists, pollution in any water or atmospheric air of the Philippines.
physicists, and other technicians"; and required in Section It is not to be understood, however, that a fiscal or public
3 that the Chairman of the Commission shall be the prosecutor may not file an information for a violation of the
Chairman of the National Science Development Board, said law at all. He may do so if the Commission had made
one of the part-time commissioners shall be a a finding or determination that the law or any of its orders
recommendee of the Philippine Council of Science and had been violated. In the criminal case presently
Technology, and one of the two full-time commissioner considered, there had been no prior determination by the
shall be a sanitary engineer. Commission that the supposed acts of the petitioner had
caused pollution to any water of the Philippines. The filing
The vesting of authority in an administrative body to of the information for the violation of Section 9 of the law
determine when to institute a criminal action for a violation is, therefore, premature and unauthorized.
of the law entrusted to it for administration or enforcement, Concommittantly, the respondent Judge is without
to the exclusion of the regular prosecution service of the jurisdiction to take cognizance of the offense charged
government, is not new in this jurisdiction. It is recognized therein.
in Yao Lit vs. Geraldez et al., 106 Phil. 545 which upheld
the exclusive authority of the Commissioner of WHEREFORE, the petition is hereby granted and the
Immigration' to investigate and impose administrative fines questioned Orders of the respondent Judge are hereby
upon violators of the provisions of Republic Act No. 751 for annuled and set aside. The respondent Judge is ordered
the reason that said official "has better facilities than the to dismiss Criminal Case No. 5984-75 for lack of
prosecuting officials to carry out the provisions of the said jurisdiction. No costs. SO ORDERED.
Act, the former official being the keeper of the records POLLUTION ADJUDICATION BOARD, petitioner vs.
pertaining to aliens." The same principle has been COURT OF APPEALS and SOLAR TEXTILE FINISHING
recognized with respect to the prosecutions of violations of CORPORATION, respondents.; G.R. No. 93891
the Anti-Dummy Law (Republic Act No. 1131.) In holding March 11, 1991
that the City Fiscal of Manila has no authority to prosecute
such violations independently of the Anti-Dummy Board, it Petitioner Pollution Adjudication Board ("Board") asks us
was said: to review the Decision and Resolution promulgated on 7
February 1990 and 10 May 1990, respectively, by the
Were the city fiscal or the provincial fiscals who have the Court of Appeals in C.A.-G R. No. SP 18821 entitled
power or right to prosecute violations of all laws and "Solar Textile Finishing Corporation v. Pollution
ordinances allowed to prosecute violations of the Anti- Adjudication Board." In that Decision and Resolution, the
Dummy Board, there would be no order, concert, Court of Appeals reversed an order of the Regional Trial
cooperation, and coordination between the said agencies Court, Quezon City, Branch 77, in Civil Case No. Q-89-
of the government. The function of coordination which is 2287 dismissing private respondent Solar Textile Finishing
entrusted to the Anti-Dummy Board is evident from all the Corporation's ("Solar") petition for certiorari and remanded
above-quoted provisions of Republic Act No. 1130. There the case to the trial court for further proceedings.
can be no coordination as envisioned in the law unless the
Anti-Dummy Board be given the power to direct and
Law on NatRes (73-83 45

On 22 September 1988, petitioner Board issued an ex The findings of these two (2) inspections were that Solar's
parte Order directing Solar immediately to cease and wastewater treatment plant was non-operational and that
desist from utilizing its wastewater pollution source its plant generated about 30 gallons per minute of
installations which were discharging untreated wastewater wastewater, 80% of which was being directly discharged
directly into a canal leading to the adjacent Tullahan- into a drainage canal leading to the Tullahan-Tinejeros
Tinejeros River. The Order signed by Hon. Fulgencio River. The remaining 20% of the wastewater was being
Factoran, Jr., as Board Chairman, reads in full as follows: channeled through Solar's non-operational wastewater
treatment plant. Chemical analysis of samples of Solar's
Respondent, Solar Textile Finishing Corporation with plant effluents showed the presence of pollutants on a level in
and place of business at 999 General Pascual Avenue, excess of what was permissible under P.D. No. 984 and
Malabon, Metro Manila is involved in bleaching, rinsing its Implementing Regulations.
and dyeing textiles with wastewater of about 30 gpm.
being directly discharged untreated into the sewer. Based A copy of the above Order was received by Solar on 26
on findings in the Inspections conducted on 05 November September 1988. A Writ of Execution issued by the Board
1986 and 15 November 1986, the volume of untreated was received by Solar on 31 March 1989.
wastewater discharged in the final out fall outside of the
plant's compound was even greater. The result of Meantime, Solar filed a motion for reconsideration/appeal
inspection conducted on 06 September 1988 showed that with prayer for stay of execution of the Order dated 22
respondent's Wastewater Treatment Plant was noted September 1988. Acting on this motion, the Board issued
unoperational and the combined wastewater generated an Order dated 24 April 1989 allowing Solar to operate
from its operation was about 30 gallons per minute and temporarily, to enable the Board to conduct another
80% of the wastewater was being directly discharged into inspection and evaluation of Solar's wastewater treatment
a drainage canal leading to the Tullahan-Tinejeros River facilities. In the same Order, the Board directed the
by means of a by-pass and the remaining 20% was Regional Executive Director of the DENR/ NCR to conduct
channelled into the plant's existing Wastewater Treatment the inspection and evaluation within thirty (30) days.
Plant (WTP). Result of the analyses of the sample taken
from the by-pass showed that the wastewater is highly On 21 April 1989, however, Solar went to the Regional
pollutive in terms of Color units, BOD and Suspended Trial Court of Quezon City, Branch 77, on petition for
Solids, among others. These acts of respondent in spite of certiorari with preliminary injunction against the Board, the
directives to comply with the requirements are clearly in petition being docketed as Civil Case No. Q-89-2287.
violation of Section 8 of Presidential Decree No. 984 and
Section 103 of its Implementing Rules and Regulations On 21 July 1989, the Regional Trial Court dismissed
and the 1982 Effluent Regulations. Solar's petition upon two (2) grounds, i.e., that appeal and
not certiorari from the questioned Order of the Board as
WHEREFORE, pursuant to Section 7 of P.D. 984 and well as the Writ of Execution was the proper remedy, and
Section 38 of its Implementing Rules and Regulations, that the Board's subsequent Order allowing Solar to
respondent is hereby ordered to cease and desist from operate temporarily had rendered Solar's petition moot
utilizing its wastewater pollution source installation and and academic.
discharging its untreated wastewater directly into the canal
leading to the Tullahan-Tinejeros River effective Dissatisfied, Solar went on appeal to the Court of Appeals
immediately upon receipt hereof and until such time when which, in the Decision here assailed, reversed the Order of
it has fully complied with all the requirements and until dismissal of the trial court and remanded the case to that
further orders from this Board. court for further proceedings. In addition, the Court of
Appeals declared the Writ of Execution null and void. At
SO ORDERED.1 the same time, the Court of Appeals said in the dispositive
portion of its Decision that:
We note that the above Order was based on findings of
several inspections of Solar's plant: . . .. Still and all, this decision is without prejudice to
whatever action the appellee [Board] may take relative to
a. inspections conducted on 5 November 1986 and the projected 'inspection and evaluation' of appellant's
12 November 1986 by the National Pollution Control [Solar's] water treatment facilities. 3
Commission ("NPCC"), the predecessor of the Board ;2
and The Court of Appeals, in so ruling, held that certiorari was
a proper remedy since the Orders of petitioner Board may
b. the inspection conducted on 6 September 1988 result in great and irreparable injury to Solar; and that
by the Department of Environment and Natural Resources while the case might be moot and academic, "larger
("DENR"). issues" demanded that the question of due process be
Law on NatRes (73-83 46

settled. Petitioner Board moved for reconsideration, prevents or abates the said pollution within the allowable
without success. standards or modified or nullified by a competent court.
(Emphasis supplied)
The Board is now before us on a Petition for Review
basically arguing that: We note that under the above-quoted portion of Section
7(a) of P.D. No. 984, an ex parte cease and desist order
1. its ex parte Order dated 22 September 1988 and may be issued by the Board (a) whenever the wastes
the Writ of Execution were issued in accordance with law discharged by an establishment pose an "immediate threat
and were not violative of the requirements of due process; to life, public health, safety or welfare, or to animal or plant
and life," or (b) whenever such discharges or wastes exceed
"the allowable standards set by the [NPCC]." On the one
2. the ex parte Order and the Writ of Execution are hand, it is not essential that the Board prove that an
not the proper subjects of a petition for certiorari. "immediate threat to life, public health, safety or welfare, or
to animal or plant life" exists before an ex parte cease and
The only issue before us at this time is whether or not the desist order may be issued. It is enough if the Board finds
Court of Appeals erred in reversing the trial court on the that the wastes discharged do exceed "the allowable
ground that Solar had been denied due process by the standards set by the [NPCC]." In respect of discharges of
Board. wastes as to which allowable standards have been set by
the Commission, the Board may issue an ex parte cease
Petitioner Board claims that under P.D. No. 984, Section and desist order when there is prima facie evidence of an
7(a), it has legal authority to issue ex parte orders to establishment exceeding such allowable standards.
suspend the operations of an establishment when there is Where, however, the effluents or discharges have not yet
prima facie evidence that such establishment is been the subject matter of allowable standards set by the
discharging effluents or wastewater, the pollution level of Commission, then the Board may act on an ex parte basis
which exceeds the maximum permissible standards set by when it finds at least prima facie proof that the wastewater
the NPCC (now, the Board). Petitioner Board contends or material involved presents an "immediate threat to life,
that the reports before it concerning the effluent public health, safety or welfare or to animal or plant life."
discharges of Solar into the Tullahan-Tinejeros River Since the applicable standards set by the Commission
provided prima facie evidence of violation by Solar of existing at any given time may well not cover every
Section 5 of the 1982 Effluent Code. possible or imaginable kind of effluent or waste discharge,
the general standard of an "immediate threat to life, public
Solar, on the other hand, contends that under the Board's health, safety or welfare, or to animal and plant life"
own rules and regulations, an ex parte order may issue remains necessary.
only if the effluents discharged pose an "immediate threat
to life, public health, safety or welfare, or to animal and Upon the other hand, the Court must assume that the
plant life." In the instant case, according to Solar, the extant allowable standards have been set by the
inspection reports before the Board made no finding that Commission or Board precisely in order to avoid or
Solar's wastewater discharged posed such a threat. neutralize an "immediate threat to life, public health, safety
or welfare, or to animal or plant life.''
The Court is not persuaded by Solar's contention. Section
7(a) of P.D. No. 984 authorized petitioner Board to issue Section 5 of the Effluent Regulations of 1982 4 sets out
ex parte cease and desist orders under the following the maximum permissible levels of physical and chemical
circumstances: substances which effluents from domestic wastewater
treatment plants and industrial plants" must not exceed
P.D. 984, Section 7, paragraph (a), provides: "when discharged into bodies of water classified as Class
A, B, C, D, SB and SC in accordance with the 1978 NPCC
(a) Public Hearing. . . . Provided, That whenever the Rules and Regulations." The waters of Tullahan-Tinejeros
Commission finds prima facie evidence that the River are classified as inland waters Class D under
discharged sewage or wastes are of immediate threat to Section 68 of the 1978 NPCC Rules and Regulations 5
life, public health, safety or welfare, or to animal or plant which in part provides that:
life, or exceeds the allowable standards set by the
Commission, the Commissioner may issue an ex-parte Sec. 68. Water Usage and Classification. The quality of
order directing the discontinuance of the same or the Philippine waters shall be maintained in a safe and
temporary suspension or cessation of operation of the satisfactory condition according to their best usages. For
establishment or person generating such sewage or this purpose, all water shall be classified according to the
wastes without the necessity of a prior public hearing. The following beneficial usages:
said ex-parte order shall be immediately executory and
shall remain in force until said establishment or person (a) Fresh Surface Water
Law on NatRes (73-83 47

Classification g) oil/Grease
xxx xxx xxx in mg./1. 10 g) Oil/Grease
mg./1.
Best usage h) Detergents
Class D mg./1." 5 h) Detergents
For agriculture, irrigation, livestock watering and industrial mg./1. MBAS 2.93
cooling and processing. i) Dissolved
oxygen, mg./1. 0
xxx xxx xxx j) Settleable
Matter, mg./1. 0.4 1.5
(Emphases supplied) k) Total Dis
solved Solids
The reports on the inspections carried on Solar's mg./1. 800 610
wastewater treatment facilities on 5 and 12 November l) Total Solids 1,400 690
1986 and 6 September 1988 set forth the following m) Turbidity NTU / ppm, SiO3 70
Identical finding: The November 1986 inspections report concluded that:

a. For legal action in [view of] implementing rules Records of the Commission show that the plant under its
and regulations of P.D. No. 984 and Section 5 of the previous owner, Fine Touch Finishing Corporation, was
Effluent Regulations of 1982. 6 issued a Notice of Violation on 20 December 1985
directing same to cease and desist from conducting dyeing
Placing the maximum allowable standards set in Section 5 operation until such time the waste treatment plant is
of the Effluent Regulations of 1982 alongside the findings already completed and operational. The new owner Solar
of the November 1986 and September 1988 inspection Textile Corporation informed the Commission of the plant
reports, we get the following results: acquisition thru its letter dated March 1986 (sic).

"Inland The new owner was summoned to a hearing held on 13


Waters October 1986 based on the adverse findings during the
(Class C & D7 inspection/water sampling test conducted on 08 August
1986. As per instruction of the Legal Division a re-
November inspection/sampling text should be conducted first before
1986 an appropriate legal action is instituted; hence, this
Report8 inspection.
Station 1 September
1988 Based on the above findings, it is clear that the new owner
Report9 continuously violates the directive of the Commission by
Station 1 undertaking dyeing operation without completing first and
a) Color in operating its existing WTP. The analysis of results on
platinum water samples taken showed that the untreated
cobalt wastewater from the firm pollutes our water resources. In
units 100 a) Color units this connection, it is recommended that appropriate legal
(Apparent action be instituted immediately against the firm. . . .10
Color) 250 125
b) pH 6-8.5 b) pH 9.3 8.7 The September 1988 inspection report's conclusions were:
c) Tempera-
ture in C 40 c) Temperature 1. The plant was undertaking dyeing, bleaching and
(C) rinsing operations during the inspection. The combined
d) Phenols in wastewater generated from the said operations was
mg.1 0.1 d) Phenols in estimated at about 30 gallons per minute. About 80% of
mg./1. the wastewater was traced directly discharged into a
e) Suspended drainage canal leading to the Tullahan-Tinejeros river by
solids in means of a bypass. The remaining 20% was channeled
mg./1. 75 e) Suspended into the plant's existing wastewater treatment plant (WTP).
solids in
mg./1. 340 80 2. The WTP was noted not yet fully operational-
f) BOD in some accessories were not yet installed.1wphi1 Only the
mg./1. 80 f) BOD (5-day) sump pit and the holding/collecting tank are functional but
mg./1 1,100 152 appeared seldom used. The wastewater mentioned
Law on NatRes (73-83 48

channeled was noted held indefinitely into the collection community from the emission in the operation of the
tank for primary treatment. There was no effluent business.
discharge [from such collection tank].
2. The Acting Mayor, in a letter of February l6, 1989,
3. A sample from the bypass wastewater was called the attention of petitioner to the pollution emitted by
collected for laboratory analyses. Result of the analyses the fumes of its plant whose offensive odor "not only
show that the bypass wastewater is polluted in terms of pollute the air in the locality but also affect the health of the
color units, BOD and suspended solids, among others. residents in the area," so that petitioner was ordered to
(Please see attached laboratory resul .)11 stop its operation until further orders and it was required to
bring the following:
From the foregoing reports, it is clear to this Court that
there was at least prima facie evidence before the Board xxx xxx xxx
that the effluents emanating from Solar's plant exceeded
the maximum allowable levels of physical and chemical (3) Region III-Department of Environment and
substances set by the NPCC and that accordingly there Natural Resources Anti-Pollution permit. (Annex A-2,
was adequate basis supporting the ex parte cease and petition)
desist order issued by the Board. It is also well to note that
the previous owner of the plant facility Fine Touch 3. This action of the Acting Mayor was in response
Finishing Corporation had been issued a Notice of to the complaint of the residents of Barangay Guyong, Sta.
Violation on 20 December 1985 directing it to cease and Maria, Bulacan, directed to the Provincial Governor
refrain from carrying out dyeing operations until the water through channels (Annex A-B, petition).. . .
treatment plant was completed and operational. Solar, the
new owner, informed the NPCC of the acquisition of the 4. The closure order of the Acting Mayor was issued
plant on March 1986. Solar was summoned by the NPCC only after an investigation was made by Marivic Guina who
to a hearing on 13 October 1986 based on the results of in her report of December 8, 1988 observed that the fumes
the sampling test conducted by the NPCC on 8 August emitted by the plant of petitioner goes directly to the
1986. Petitioner Board refrained from issuing an ex parte surrounding houses and that no proper air pollution device
cease and desist order until after the November 1986 and has been installed. (Annex A-9, petition)
September 1988 re-inspections were conducted and the
violation of applicable standards was confirmed. In other xxx xxx xxx
words, petitioner Board appears to have been remarkably
forbearing in its efforts to enforce the applicable standards 6. While petitioner was able to present a temporary
vis-a-vis Solar. Solar, on the other hand, seemed very permit to operate by the then National Pollution Control
casual about its continued discharge of untreated, pollutive Commission on December 15,1987, the permit was good
effluents into the Tullahan- Tinerejos River, presumably only up to May 25,1988 (Annex A-12, petition). Petitioner
loath to spend the money necessary to put its Wastewater had not exerted any effort to extend or validate its permit
Treatment Plant ("WTP") in an operating condition. much less to install any device to control the pollution and
prevent any hazard to the health of the residents of the
In this connection, we note that in Technology Developers, community."
Inc. v. Court of appeals, et al.,12 the Court very recently
upheld the summary closure ordered by the Acting Mayor In the instant case, the ex parte cease and desist Order
of Sta. Maria, Bulacan, of a pollution-causing was issued not by a local government official but by the
establishment, after finding that the records showed that: Pollution Adjudication Board, the very agency of the
Government charged with the task of determining whether
1. No mayor's permit had been secured. While it is the effluents of a particular industrial establishment comply
true that the matter of determining whether there is a with or violate applicable anti-pollution statutory and
pollution of the environment that requires control if not regulatory provisions.
prohibition of the operation of a business is essentially
addressed to the then National Pollution Control Ex parte cease and desist orders are permitted by law and
Commission of the Ministry of Human Settlements, now regulations in situations like that here presented precisely
the Environmental Management Bureau of the Department because stopping the continuous discharge of pollutive
of Environment and Natural Resources, it must be and untreated effluents into the rivers and other inland
recognized that the mayor of a town has as much waters of the Philippines cannot be made to wait until
responsibility to protect its inhabitants from pollution, and protracted litigation over the ultimate correctness or
by virtue of his police power, he may deny the application propriety of such orders has run its full course, including
for a permit to operate a business or otherwise close the multiple and sequential appeals such as those which Solar
same unless appropriate measures are taken to control has taken, which of course may take several years. The
and/or avoid injury to the health of the residents of the relevant pollution control statute and implementing
Law on NatRes (73-83 49

regulations were enacted and promulgated in the exercise A.C.-G.R. No. SP 18821 are hereby SET ASIDE. The
of that pervasive, sovereign power to protect the safety, Order of petitioner Board dated 22 September 1988 and
health, and general welfare and comfort of the public, as the Writ of Execution, as well as the decision of the trial
well as the protection of plant and animal life, commonly court dated 21 July 1989, are hereby REINSTATED,
designated as the police power. It is a constitutional without prejudice to the right of Solar to contest the
commonplace that the ordinary requirements of procedural correctness of the basis of the Board's Order and Writ of
due process yield to the necessities of protecting vital Execution at a public hearing before the Board.
public interests like those here involved, through the TECHNOLOGY DEVELOPERS, INC., petitioner, vs.
exercise of police power. The Board's ex parte Order and COURT OF APPEALS, HON. NARCISO T. ATIENZA as
Writ of Execution would, of course, have compelled Solar Presiding Judge, Bulacan, RTC, and HON. VICENTE
temporarily to stop its plant operations, a state of affairs CRUZ, Acting Mayor and the MUNICIPALITY OF STA.
Solar could in any case have avoided by simply absorbing MARIA, BULACAN, respondents.; G.R. No. 94759
the bother and burden of putting its WTP on an operational January 21, 1991
basis. Industrial establishments are not constitutionally
entitled to reduce their capitals costs and operating The authority of the local executive to protect the
expenses and to increase their profits by imposing upon community from pollution is the center of this controversy.
the public threats and risks to its safety, health, general
welfare and comfort, by disregarding the requirements of The antecedent facts are related in the appealed decision
anti- pollution statutes and their implementing regulations. of the Court of Appeals as follows:

It should perhaps be made clear the Court is not here Petitioner, a domestic private corporation engaged in the
saying that the correctness of the ex parte Order and Writ manufacture and export of charcoal briquette, received a
of Execution may not be contested by Solar in a hearing letter dated February 16, 1989 from private respondent
before the Board itself. Where the establishment affected acting mayor Pablo N. Cruz, ordering the full cessation of
by an ex parte cease and desist order contests the the operation of the petitioner's plant located at Guyong,
correctness of the prima facie findings of the Board, the Sta. Maria, Bulacan, until further order. The letter likewise
Board must hold a public hearing where such requested Plant Manager Mr. Armando Manese to bring
establishment would have an opportunity to controvert the with him to the office of the mayor on February 20, 1989
basis of such ex parte order. That such an opportunity is the following: a) Building permit; b) Mayor's permit; c)
subsequently available is really all that is required by the Region III-Pollution of Environment and Natural Resources
due process clause of the Constitution in situations like Anti-Pollution Permit; and of other document.
that we have here. The Board's decision rendered after
the public hearing may then be tested judicially by an At the requested conference on February 20, 1989,
appeal to the Court of Appeals in accordance with Section petitioner, through its representative, undertook to comply
7(c) of P.D. No. 984 and Section 42 of the Implementing with respondent's request for the production of the
Rules and Regulations. A subsequent public hearing is required documents. In compliance with said undertaking,
precisely what Solar should have sought instead of going petitioner commenced to secure "Region III-Department of
to court to seek nullification of the Board's Order and Writ Environmental and Natural Resources Anti-Pollution
of Execution and instead of appealing to the Court of Permit," although among the permits previously secured
Appeals. It will be recalled the at the Board in fact gave prior to the operation of petitioner's plant was a
Solar authority temporarily to continue operations until still "Temporary Permit to Operate Air Pollution Installation"
another inspection of its wastewater treatment facilities issued by the then National Pollution Control Commission
and then another analysis of effluent samples could be (now Environmental Management Bureau) and is now at a
taken and evaluated. stage where the Environmental Management Bureau is
trying to determine the correct kind of anti-pollution devise
Solar claims finally that the petition for certiorari was the to be installed as part of petitioner's request for the
proper remedy as the questioned Order and Writ of renewal of its permit.
Execution issued by the Board were patent nullities. Since
we have concluded that the Order and Writ of Execution Petitioner's attention having been called to its lack of
were entirely within the lawful authority of petitioner Board, mayor's permit, it sent its representatives to the office of
the trial court did not err when it dismissed Solar's petition the mayor to secure the same but were not entertained.
for certiorari. It follows that the proper remedy was an
appeal from the trial court to the Court of Appeals, as On April 6, 1989, without previous and reasonable notice
Solar did in fact appeal. upon petitioner, respondent acting mayor ordered the
Municipality's station commander to padlock the premises
ACCORDINGLY, the Petition for Review is given DUE of petitioner's plant, thus effectively causing the stoppage
COURSE and the Decision of the Court of Appeals dated of its operation.
7 February 1990 and its Resolution dated 10 May 1990 in
Law on NatRes (73-83 50

Left with no recourse, petitioner instituted an action for c) Exhibit "B-3", a letter addressed to Hon. Roberto
certiorari, prohibition, mandamus with preliminary Pagdanganan Governor of the Province of Bulacan, dated
injunction against private respondent with the court a quo November 22, 1988, complaining about the smoke coming
which is presided by the respondent judge. In its prayer for out of the chimney of the company while in operation.
the issuance of a writ of preliminary mandatory injunction,
it alleged therein that the closure order was issued in Reassessing all the evidence adduced, the lower court, on
grave abuse of discretion. June 14, 1989, issued an order (a) setting aside the order
dated April 28, 1989, which granted a Writ of Preliminary
During the hearing of the application for the issuance of a Mandatory Injunction, and (b) dissolving the writ
writ of preliminary injunction on April 14, 1989, herein consequently issued.
parties adduced their respective evidences. The
respondent judge, April 19, 1989, found that petitioner is A motion for reconsideration dated July 6, 1989 was filed
entitled to the issuance of the writ of preliminary by petitioner. Said motion drew an opposition dated July
mandatory injunction, hence, it ordered as follows: 19, 1989 from private respondent.

In view of the foregoing, upon petitioner's posting of a Resolving the petitioner's motion for reconsideration, the
bond in the amount of P50,000.00 to answer for such respondent judge issued an order dated August 9, 1989,
damages that respondents may sustain should petitioner denying said motion for reconsideration.1
eventually be found not entitled to the injunctive relief
hereby issued, let a PRELIMINARY MANDATORY Hence a petition for certiorari and prohibition with
INJUNCTION issue ordering the respondent Hon. Pablo preliminary injunction was filed by petitioner in the Court of
N. Cruz, and other person acting in his behalf and stead to Appeals seeking to annul and set aside (a) the order
immediately revoke his closure order dated April 6, 1989, issued by the trial court on June 14, 1989, setting aside
and allow petitioner to resume its normal business the order dated April 28, 1989, and (b) the order of August
operations until after the instant case shall have been 9, 1989, denying petitioner's motion for reconsideration of
adjudicated on the merits without prejudice to the inherent the order of June 14, 1989. In due course the petition was
power of the court to alter, modify or even revoke this denied for lack of merit by the appellate court in a decision
order at any given time. dated January 26, 1990. 2 A motion for reconsideration
thereof filed by petitioner was denied on August 10, 1990.
SO ORDERED.
Thus, the herein petition for review on certiorari filed with
The writ of preliminary mandatory injunction was issued on this Court. Six errors are alleged to have been committed
April 28, 1989, upon petitioner's posting a bond in the by the appellate court which may be synthesized into the
amount of P50,000.00. singular issue of whether or not the appellate court
committed a grave abuse of discretion in rendering its
Private respondent filed his motion for reconsideration question decision and resolution.
dated May 3, 1989. Said motion for reconsideration was
heard on May 30, 1989. Petitioner's counsel failed to The petition is devoid of merit.
appear and the hearing proceeded with the Provincial
Prosecutor presenting his evidence. The following The well-known rule is that the matter of issuance of a writ
documents were submitted: of preliminary injunction is addressed to the sound judicial
discretion of the trial court and its action shall not be
a) Exhibit "A", Investigation report on the disturbed on appeal unless it is demonstrated that it acted
Technology Developers Inc., prepared by one Marivic without jurisdiction or in excess of jurisdiction or otherwise,
Guina, and her conclusion and recommendation read: in grave abuse of its discretion. By the same token the
court that issued such a preliminary relief may recall or
Due to the manufacturing process and nature of raw dissolve the writ as the circumstances may warrant.
materials used, the fumes coming from the factory may
contain particulate matters which are hazardous to the To the mind of the Court the following circumstances
health of the people. As such, the company should cease militate against the maintenance of the writ of preliminary
operating until such a time that the proper air pollution injunction sought by petitioner:
device is installed and operational.
1. No mayor's permit had been secured. While it is
b) Exhibits "B", "B-1", "B-2", three (3) sheets of true that the matter of determining whether there is a
coupon bond containing signatures of residents of pollution of the environment that requires control if not
Barangay Guyong, Sta. Maria, Bulacan; prohibition of the operation of a business is essentially
addressed to the then National Pollution Control
Commission of the Ministry of Human Settlements, now
Law on NatRes (73-83 51

the Environmental Management Bureau of the Department


of Environment and Natural Resources, it must be All these factors justify the dissolution of the writ of
recognized that the mayor of a town has as much preliminary injunction by the trial court and the appellate
responsibility to protect its inhabitants from pollution, and court correctly upheld the action of the lower court.
by virture of his police power, he may deny the application
for a permit to operate a business or otherwise close the Petitioner takes note of the plea of petitioner focusing on
same unless appropriate measures are taken to control its huge investment in this dollar-earning industry.1wphi1
and/or avoid injury to the health of the residents of the It must be stressed however, that concomitant with the
community from the emissions in the operation of the need to promote investment and contribute to the growth
business. of the economy is the equally essential imperative of
protecting the health, nay the very lives of the people, from
2. The Acting Mayor, in a letter of February 16, the deleterious effect of the pollution of the environment.
1989, called the attention of petitioner to the pollution
emitted by the fumes of its plant whose offensive odor "not WHEREFORE, the petition is DENIED, with costs against
only pollute the air in the locality but also affect the health petitioner. SO ORDERED.
of the residents in the area," so that petitioner was ordered ERNESTO R. RODRIGUEZ, JR., ERNESTO LL.
to stop its operation until further orders and it was required RODRIGUEZ III, SACHA DEL ROSARIO, JOSE P.
to bring the following: GENITO, ZENAIDA Z. RODRIGUEZ, and ENECERIO
MONDIA, petitioners, vs. INTERMEDIATE APPELLATE
(1) Building permit; COURT and DAYTONA CONSTRUCTION &
DEVELOPMENT CORPORATION, respondents.; G.R.
(2) Mayor's permit; and No. 74816 March 17, 1987

(3) Region III-Department of Environment and Before Us is a petition to review by certiorari 1) respondent
Natural Resources Anti-Pollution permit. 3 court's decision which sets aside the order of default
rendered by the trial court and 2) respondent court's
3. This action of the Acting Mayor was in response resolution dated April 18, 1986 denying petitioners'
to the complaint of the residents of Barangay Guyong, Sta. (plaintiffs-appellees' therein) motion for extension of time
Maria, Bulacan, directed to the Provincial Governor to file motion for reconsideration of its decision. 1
through channels.4 The alleged NBI finding that some of
the signatures in the four-page petition were written by one The antecedent facts of the case are as follows:
person, 5 appears to be true in some instances,
(particularly as among members of the same family), but Plaintiffs (petitioners herein) filed on December 16, 1980,
on the whole the many signatures appear to be written by an action for abatement of a public nuisance with
different persons. The certification of the barrio captain of damages against defendant (private respondent herein).
said barrio that he has not received any complaint on the After being granted four (4) extensions of time to file an
matter 6 must be because the complaint was sent directly answer, defendant moved to dismiss the complaint on
to the Governor through the Acting Mayor. February 27, 1981 upon the ground that the lower court
has no jurisdiction to hear the instant case and for lack of
4. The closure order of the Acting Mayor was issued cause of action. However, the motion was denied by the
only after an investigation was made by Marivic Guina who court on April 3, 1981, a copy of which decision was
in her report of December 8, 1988 observed that the fumes received by the defendant on April 23, 1981. On May 5,
emitted by the plant of petitioner goes directly to the 1981 defendant filed a motion for reconsideration which
surrounding houses and that no proper air pollution device motion was denied on July 7, 1981.
has been installed.7
Instead of filing an answer, petitioner filed with Us in G.R.
5. Petitioner failed to produce a building permit from No. 57593, Daytona Construction & Development
the municipality of Sta. Maria, but instead presented a Corporation vs. Rodriguez, et al. a motion for extension of
building permit issued by an official of Makati on March time to file a petition for review, but it never filed one,
6,1987.8 prompting Us to issue a resolution dated October 5, 1981
informing the parties and the trial court that no petition for
6. While petitioner was able to present a temporary review was filed within the period that expired on August
permit to operate by the then National Pollution Control 15, 1981.
Commission on December 15, 1987, the permit was good
only up to May 25, 1988.9 Petitioner had not exerted any Upon motion of plaintiffs, the court declared the defendant
effort to extend or validate its permit much less to install in default on November 4, 1981, and authorized the
any device to control the pollution and prevent any hazard plaintiffs to present evidence ex-parte. Upon learning of
to the health of the residents of the community. the said order, the defendant on November 9, 1981 filed a
Law on NatRes (73-83 52

motion to set aside the order of default and a motion to the Supreme Court (G.R. No. 66097) which, after the
admit answer with counterclaim which motions were submission of plaintiffs' comment and defendant's reply
denied by the lower court in an order dated November 23, thereto, denied its petition for lack of merit.
1981.
The petition for injunction having been denied by both the
On June 30, 1982, the court a quo rendered judgment for IAC and this Court, defendant pursued the remedy of
the plaintiffs and against defendant, its dispositive portion appeal in respondent IAC, assigning the following errors.
reading as follows:
I. THE TRIAL COURT ERRED WHEN IT
WHEREFORE, judgment is hereby rendered as follows: DECLARED APPELLANT IN DEFAULT DESPITE THE
FACT THAT ITS FAILURE TO FILE ITS ANSWER ON
1. Declaring the operation of the cement hatching TIME WAS DUE SOLELY TO THE NEGLIGENCE OF ITS
plant of the defendant corporation as a nuisance and COUNSEL AND DESPITE THE FACT THAT THE
ordering its permanent closure; MOTION TO DISMISS THAT IT HAD FILED COULD
HAVE VERY WELL STOOD AS THE ANSWER OF THE
2. Ordering the defendant to pay plaintiff Ernesto APPELLANT.
Rodriguez, Jr. the amount of P250,000.00 as moral
damages and the amount of P5,000.00 as nominal II. THE TRIAL COURT ERRED WHEN IT
damages; ASSUMED JURISDICTION OVER THE CASE AND
WHEN IT RENDERED JUDGMENT BY DEFAULT
3. Ordering the defendant to pay plaintiff Ernesto AGAINST THE APPELLANT ON GROUNDS AND/OR
LL. Rodriguez III the amount of P200,000.00 as actual BASIS NOT ALLEGED IN THE COMPLAINT FILED
damages, the amount of P500,000.00 as moral damages AGAINST THE APPELLANT.
and the amount of P5,000.00 as nominal damages;
III. THE TRIAL COURT ERRED WHEN IT DID NOT
4. Ordering the defendant to pay plaintiff SACHA ALLOW RELIEF FROM JUDGMENT IN THE FACE OF
del Rosario the amount of P20,000.00 as actual damages, THE REASONS PRESENTED TO IT AS BASIS FOR
the amount of P50,000.00 as moral damages and the SUCH RELIEF.
amount of P5,000.00 as nominal damages;
IV. THE TRIAL COURT ERRED WHEN DESPITE
5. Ordering the defendant to pay plaintiff Zenaida Z. THE APPEAL HAVING BEEN DULY PERFECTED, IT
Rodriguez the amount of P100,000.00 as actual damages, DETAINED THE CASE WITH IT AND THEREAFTER,
the amount of P100,000.00 as moral damages and the ISSUED AN ALIAS WRIT OF EXECUTION PENDING
amount of P5,000.00 as nominal damages; and APPEAL WITHOUT APPROPRIATE PRIOR NOTICE TO
THE APPELLANT. (pp. 1-2, Appellant's Brief)
6. Ordering the defendant to pay the plaintiffs the
amount of P50,000.00 as attorney's fees, plus the costs of On March 21, 1986, respondent court promulgated its
suit. decision, the decretal portion of which is as follows:

SO ORDERED. (pp. 63-64, Record on Appeal) WHEREFORE, the Decision appealed from is hereby
reversed and set aside and another one entered,
In an order dated July 9, 1982, the trial court upon motion remanding the case to the court of origin for further
of plaintiffs granted execution pending appeal it indeed proceedings and thereafter, to render judgment
appearing as alleged in the motion that the continued accordingly.
operation of the cement batching plant of the defendant
poses a "great menace to the neighborhood, both in point No pronouncement as to costs.
of health and property."
Notice of respondent Court's decision was received by
On July 23, 1982, defendant filed a petition for relief which plaintiffs-appellees thru counsel on April 3, 1986. Plaintiffs
was however denied by the lower court. On July 29, 1982, filed on April 15, 1986 a motion for extension of 30 days
defendant filed a petition for injunction with the from April 18, 1986 or up to May 18, 1986 to file a motion
Intermediate Appellate Court which found the petition for reconsideration. However, on May 10, 1986, they filed
unmeritorious. 2 The appellate court promulgated on a 24-page motion for reconsideration.
October 5, 1983, a decision denying due course to
defendant's petition. Meanwhile, on April 23, 1986, defendant's opposition to
the motion for extension and counter-motion to enter final
Its motion for reconsideration having been denied by the judgment were received by plaintiffs. Plaintiffs countered
Appellate Court, defendant went on appeal by certiorari to with a reply filed April 29, 1986. (Annex "C-2") Plaintiffs'
Law on NatRes (73-83 53

counsel was surprised to receive on April 24, 1986, deprive parties of their fight to appeal simply because they
respondent Court's resolution dated April 18, 1986, availed themselves of a procedure which was not
denying the motion for extension. Plaintiffs requested expressly prohibited or allowed by the law or the Rules. ...
respondent Court to treat their aforesaid reply filed on April (pp. 3-4; Resolution dated May 30, 1986 in G.R. No.
29, 1986 as a motion for reconsideration of the said 70895; emphasis supplied)
resolution of April 18, 1986, received by them on April 21,
1986, the request being contained in their opposition dated This Court further elucidated:
May 22, 1986, to defendant-appellant's motion to strike out
the said opposition attached thereto as Annex C-3 " 1). Beginning one month after the promulgation of
Neither the motion for reconsideration (converted from the this Resolution, the rule shall be strictly enforced that no
reply filed on April 29, 1986) nor the motion for motion for extension of time to file a motion petition for
reconsideration of the decision itself was acted upon by new trial or reconsideration may be filed with the
respondent court. Metropolitan or Municipal Trial Courts, the Regional Trial
Courts, and the Intermediate Appellate Court. Such a
Hence this petition to review, petitioners alleging that motion may be filed only in cases pending with the
"Respondent court's challenged resolution purporting to Supreme Court as the court of last resort, which may in its
deny appellees' motion for extension of time to file a sound discretion either grant or deny the extension
motion for reconsideration is a nullity because the decision requested. (p. 4, emphasis supplied)
in Habaluyas v. Japson case, 3 solely relied on by the said
resolution has been made by the Supreme Court to The above new rules are made effective no earlier than
operate prospectively and thereby rendered inapplicable to June 30, 1986. In the instant case, respondent Court's
parties situated as petitioners are, in order precisely to decision was received by plaintiffs on April 3, 1986.
spare them from unfair and unjust deprivation of their right Plaintiffs or petitioners herein filed on April 15, 1986 a
to appeal." motion for extension of 30 days from April 18, 1986 or up
to May 18, 1986 to file a motion for reconsideration. On
In Our resolution, promulgated May 30, 1986 in the May 10, 1986, plaintiffs filed their motion for
Habaluyas case itself (G.R. No. 70895), We set aside the reconsideration. Plaintiffs' motion for extension of time was
original judgment therein, thus: not intended for delay but upon showing of good cause, to
wit: "for lack of material time due to heavy pressure of
However, the law and the Rules of Court do not expressly work on the part of petitioners' counsel presently taking
prohibit the filing of a motion for extension of time to file a charge thereof, what is more the counsel handling this
motion for reconsideration of a final order or judgment. case was doing so for the first time in substitution of Atty.
Emmanuel Pelaez, who was recently appointed Philippine
In the case of Gibbs vs. Court of First Instance (80 Phil. Ambassador to the U.S"
160), the Court dismissed the petition for certiorari and
ruled that the failure of defendant's attorney to file the It is clear therefore that petitioners' motion was based on
petition to set aside the judgment within the reglementary good cause and was filed opportunely making the act of
period was due to excusable neglect, and, consequently, respondent Court unwarranted in denying petitioners'
the record on appeal was allowed. The Court did not rule motion for extension of time to file its motion for
that the motion for extension of time to file a motion for reconsideration.
new trial or reconsideration could not be granted.
Another important issue raised by the petitioners is that
In the case of Roque vs. Gunigundo (Administrative Case the "subject decision which purports to set aside the order
No. 1684, March 30, 1979, 89 SCRA 178), a division of of default rendered by the trial court is a nullity because
the Court cited the Gibbs decision to support a statement respondent court arbitrarily ignored in grave abuse of
that a motion to extend the reglementary period for filing discretion amounting to lack of jurisdiction 1) the
the motion for reconsideration is not authorized or is not in conclusive effect of the trial court's final and unappealed
order. order denying defendant's motion to set aside the default
order," and 2) the res judicata effect of the appellate
The Intermediate Appellate Court 4 is sharply divided on court's final judgment in the injunction case
this issue. Appeals have been dismissed on the basis of aforementioned upholding the trial court's order granting
the original decision in this case. execution of its Judgment pending appeal and,
necessarily, the default order as well 3) the law of the case
After considering the able arguments of counsels for effect of the appellate court's express ruling in the said
petitioners and respondents, the Court resolved that the injunction case sustaining the default order.
interest of justice would be better served if the ruling in the
original decision were applied prospectively from the time Petitioners' contentions merit our consideration.
herein stated The reason is that it would be unfair to
Law on NatRes (73-83 54

It has been Our consistent ruling that a default order, issued to the defendant stated that its operation at the
being interlocutory, is not appealable but an order denying place shall "not (be) beyond Dec. 31, 1979" (Exhibit B-2),
a motion or petition to set aside an order of default is not it was somehow allowed to operate way beyond said
merely interlocutory but final and therefore immediately period.
appealable. 5
Plaintiff Ernesto LL. Rodriguez Ill testified that he has three
Since the trial court's order of November 13, 1981, parcels of residential lots adjacent to the Daytona
denying defendant's motion to set aside the order of compound. He informed the Court that his property, with
default was appealable but was not appealed by an area of 8,892 square meters has been over-run by
defendant, the necessary conclusion is that the default effluence from the cement batching plant of the defendant.
order became final. Clearly therefore, respondent Court The sediment settled on the lots and all forms of
committed a grave abuse of discretion in disregarding the vegetation have died as a result, and the land
finality of the default order. tremendously diminished in value. His three lots are
located in a prime residential zone and each square meter
The validity and finality of the default order was upheld by in the area is easily valued at P500.00. While he would like
the judgment of the Appellate Court in the injunction case to sell at least a part of his property, he finds no buyer
(which passed upon the merits of the issuance of an order because of its condition. It would cost him no less than
of execution pending appeal) by virtue of the principle of P250,000.00 to be able to repair the damage done to his
res judicata and the doctrine re the law of the case. property, and since its present condition has been existing
during the five years, he claimed that the interest on his
There is no question that there were good reasons for the loss would be about P5,000.00. He has agreed to his
trial court to issue the order of execution pending appeal. counsel's fee of P200,000.00. Zenaida Rodriguez testified
The order categorically stated that there was a need for that she owns a lot with an area of 1,500 square meters.
the closure and stoppage of the operation of defendant's Two thirds of this area has been damaged by the cement
(Daytona Construction) cement batching plant because it dust, emanating from the defendant's cement batching
posed "a great menace to the neighborhood both in point plant. The continous flow of cement dust into her property
of health and property." The trial court thus stated: affected her deep well, their source of drinking water, and
most of their fruit-bearing and ornamental trees dried up.
From the uncontroverted evidence presented by the She also said that she has had sleepless nights and
plaintiffs, there is hardly any question that the cement dust became nervous as a result of the batching plant
coming from the batching plant of the defendant operation. Even her previous pedigreed poodles have
corporation is injurious to the health of the plaintiffs and been afflicted by all sorts of illnesses, many of them dying
other residents in the area. The noise, the vibration, the in the process. She claimed to have sustained damages
smoke and the odor generated by the day and night amounting to P370,000.00.
operation of the plant must indeed be causing them
serious discomfort and untold miseries. Its operation SACHA del Rosario testified that her house has to close
therefore violates certain rights of the plaintiffs and causes its windows most of the time because of the dust pollution
them damage. It is thus a nuisance and its abatement and her precious plants have been destroyed by the
justified. (Decision, p. 5; p. 90, Rollo) cement powder coming from the constant traffic of trucks
and other vehicles carrying the product of the batching
after taking into consideration evidence presented by plant passing through her area. She claims damages
plaintiffs (petitioners herein) as follows: amounting to more than P100,000.00.

The evidence shows that the defendant is a domestic A chemical engineer, Alexander Cruz, said that the
corporation duly organized and existing under the laws of effluence deposited on the properties of Ernesto LL.
the Philippines with business address of 252 Don Mariano Rodriguez III and Zenaida Rodriguez has a very high PH
Marcos Avenue (actually South Zuzuarregui Avenue), 11.8, and the soil is highly alkaline and cannot support
Quezon City. It was issued by the Quezon City plant life; that pollution coming from the batching plant can
government a business permit (Exhibit B) for the cause stomach disorder and skin problems; that the place
manufacture of road and building concrete materials such of Ernesto LL. Rodriguez III is bare of grass and the trees
as concrete aggregates, with cement batching plant. are dying, (Exhibits J, J-1 and J-2 and that there is also a
Among the conditions set forth in the permit are that the high degree of calcium on the property in question.
said batching plant shall (1) institute measures to prevent
dust emission during the manual charging of cement from Witness Guido L. Quiban a civil engineer, testified that on
bags to the receiving hopper of the bucket elevator of the the basis of his examination of the property of Rodriguez I
batching plant; (2) remove all sediment deposit in the I I affected by the pollution, it would cost at least
settling of tank for process water and proper maintenance P250,000.00 for the excavation filling, concreting of canal
should be observed at all times. While the original permit
Law on NatRes (73-83 55

and rental of equipment to repair it or restore it to its status community all look dirty and dusty because of the pollution
quo ante. that the batching plant of the defendant causes. (Decision
in Injunction Case, AC-G.R. No. 14602-SP, pp. 10-14)
Lawyer Ernesto R. Rodriguez, Jr., the 70-year old father of
both Ernesto Ill and Zenaida Z. Rodriguez, submitted a Anent the default order, the appellate court in the
medical certificate that he had recently been taken ill with injunction case said:
acute bronchial asthma, hypertension and atherosclerotic
heart disease. (Exhibits L, L-1 to L-4). His physician, a From the foregoing, it appears that petitioner was recreant
specialist graduate from the University of London and in failing to file an answer after respondent judge denied
connected with various hospitals in Manila, advised him its motion to dismiss the complaint. The motion to dismiss
against exposure to environmental allegens, specifically was denied in the order of the lower court under date of
cement dust and pollution. He also submitted as exhibits April 3, 1981, a copy of which was received by petitioner
various newspaper clippings (Exhibit M and excerpts from on April 23, 1981. A motion for reconsideration of the order
a book (Exhibits N and N-1 showing that pollution can of denial filed by petitioner on May 7, 1981 was denied by
irritate the eye, sear lungs and destroy vegetation, raise said court on July 7, 1981. Instead of filing an answer
blood pressure, increase cholesterol levels, interfere with promptly, petitioner filed with the Supreme Court a motion
sleep, cause ulcer, trigger heart attacks and the like; that it for extension of time to file a petition for review, but it
is the common denominator of respiratory diseases, never filed one, prompting the Supreme Court to issue a
especially asthma chronic bronchitis, bronchial asthma resolution dated October 5, 1981 informing the parties that
and emphysema and that polluted air can develop no petition for review was filed within the period that
abnormalities in lung function. expired on August 15, 1981. Inspite of the Supreme
Court's resolution, petitioner still failed to file any answer or
Dr. Raul I. del Rosario, a neighboring physician, testified pleading to arrest the running of the prescriptive period. It
that he had treated several patients who traced their was only on July 23, 1982, when petitioner filed its Petition
sickness to the pollution caused by defendant Daytona for Relief which was nine (9) months after the Supreme
batching plant. He said that cement dust produces Court's resolution was issued. Petitioner's assertion in its
broncho-pulmonary obstructive diseases, broncho fibriotic Petition for Relief that the failure to file the answer was
lesions which may produce cardio pulmonary caused by "the unforseen sickness of its corporate
complications, and the people living in the neighborhood of secretary who has custody of the records necessary for
the batching plant are the most susceptible to these the preparation of its defense" cannot be taken without
diseases. He reported many cases of bronchial asthma in much doubt and hesitation. Petitioner did not even point
both children and adult who live in the vicinity of the out who was the supposed corporate secretary or explain
cement batching plant and these cases have been why the records were in the possession of the corporate
intermittently admitted and discharged from the Quirino secretary instead of the counsel handling the case.
Labor Hospital where he presently works as a resident (Decision in Injunction case, p. 16; emphasis supplied)
physician. He had intended to open a medical clinic at his
residence but he could not do so because the washings With reference to defendant's allegation that it thought that
from the cement mixers are dumped on the access road in the period within which to answer (after its motion to
front of his house and when these washings are dried up dismiss had been denied) had been suspended by its
they pollute the neighborhood, rendering his intended having filed a petition for review before the Supreme
medical clinic unfit and impractical for the treatment of Court, same is without merit. The circumstances of the
patients, particularly those suffering from respiratory case point to a deliberate desire to delay: the corporation,
ailments. governed as it is by knowledgeable business executives,
should have taken steps to prevent its being declared in
Another lawyer, Eliseo Alampay, Jr., who likewise resides default. The corporation waited six (6) months before
a few meters away from the site of the Daytona batching verifying the status of the case: in the meantime it had
plant, testified that the said plant is certainly injurious to been declared in default, a judgment by default had been
the health; that the cement dust are agents of lung rendered against it, execution was already pending before
ailments, impair the growth of plants and even kill the birds it woke up to file the case at hand.
in their cages; that it is a demonstrable nuisance because
its uncontrolled engine noise and night long pounding We agree with Justice Luis A. Javellana in his concurring
prevent the neighborhood from being able to sleep opinion in the injunction case before the appellate court,
soundly and peacefully. He told the court that there was a thus:
time when he felt like organizing the whole neighborhood
into a demolition team to forcibly dismantle the entire Petitioner's conduct here appears to me to be tainted with
Daytona plant because "the authorities concerned fraud and intended simply to delay the disposition of the
apparently have chosen to close their eyes and leave us to case. When its motion to dismiss the complaint was
our miserable plight." He said that the homes in the denied, and its motion for reconsideration of that denial
Law on NatRes (73-83 56

was, Unwise denied, it manifested its intention to elevate


these orders to the Supreme Court on a petition for review. Petitioners allege that the particulate matters (PM)
Yet, it did nothing to this end. The purpose of the ploy is complex mixtures of dust, dirt, smoke, and liquid droplets,
obvious. Once it had announced its intention to go to the varying in sizes and compositions emitted into the air from
Supreme Court, it effectively suspended the proceedings various engine combustions have caused detrimental
in the trial court, or, at least, that was the effect. This effects on health, productivity, infrastructure and the
enabled it to continue with its operations and it would have overall quality of life. Petitioners particularly cite the effects
done so indefinitely if it had not been declared in-default of certain fuel emissions from engine combustion when
and private respondents allowed to present their evidence. these react to other pollutants. For instance, petitioners
It is quite apparent that petitioner really had no intention of aver, with hydrocarbons, oxide of nitrogen (NOx) creates
elevating the case to the Supreme Court otherwise, it smog; with sulfur dioxide, it creates acid rain; and with
would not have allowed the extended period given to it by ammonia, moisture and other compounds, it reacts to form
the Supreme Court to lapse without filing the petition. Or, if nitric acid and harmful nitrates. Fuel emissions also cause
it was in good faith, there it should have informed the trial retardation and leaf bleaching in plants. According to
court that it was no longer pursuing its remedy in the petitioner, another emission, carbon monoxide (CO), when
Supreme Court after it had decided that it is no longer not completely burned but emitted into the atmosphere
availing of such remedy. Instead, it concealed this fact and then inhaled can disrupt the necessary oxygen in
from the trial court and the adverse party, and allowed blood. With prolonged exposure, CO affects the nervous
matters to take their course. It was not until it received the system and can be lethal to people with weak hearts.6
adverse decision that it frantically sought to set things right
I do not think that petitioner deserves any consideration for Petitioners add that although much of the new power
trifling with the administration of justice. (pp. 3-4; emphasis generated in the country will use natural gas while a
supplied) number of oil and coal-fired fuel stations are being
phased-out, still with the projected doubling of power
WHEREFORE, the assailed decision and resolution are generation over the next 10 years, and with the continuing
hereby SET ASIDE, and a new judgment is hereby high demand for motor vehicles, the energy and transport
rendered REINSTATING the decision of the trial court with sectors are likely to remain the major sources of harmful
the modification that all awards for nominal damages are emissions. Petitioners refer us to the study of the
hereby eliminated. Costs against private respondent. SO Philippine Environment Monitor 20027, stating that in four
ORDERED. of the country's major cities, Metro Manila, Davao, Cebu
HILARION M. HENARES, JR., VICTOR C. AGUSTIN, and Baguio, the exposure to PM10, a finer PM which can
ALFREDO L. HENARES, DANIEL L. HENARES, penetrate deep into the lungs causing serious health
ENRIQUE BELO HENARES, and CRISTINA BELO problems, is estimated at over US$430 million.8 The study
HENARES, petitioners, vs. LAND TRANSPORTATION also reports that the emissions of PMs have caused the
FRANCHISING AND REGULATORY BOARD and following:
DEPARTMENT OF TRANSPORTATION AND
COMMUNICATIONS, respondents.; G.R. No. 158290 Over 2,000 people die prematurely. This loss is valued at
October 23, 2006 about US$140 million.

Petitioners challenge this Court to issue a writ of Over 9,000 people suffer from chronic bronchitis, which
mandamus commanding respondents Land Transportation is valued at about US$120 million.
Franchising and Regulatory Board (LTFRB) and the
Department of Transportation and Communications Nearly 51 million cases of respiratory symptom days in
(DOTC) to require public utility vehicles (PUVs) to use Metro Manila (averaging twice a year in Davao and Cebu,
compressed natural gas (CNG) as alternative fuel. and five to six times in Metro Manila and Baguio), costs
about US$170 million. This is a 70 percent increase, over
Citing statistics from the Metro Manila Transportation and a decade, when compared with the findings of a similar
Traffic Situation Study of 1996,1 the Environmental study done in 1992 for Metro Manila, which reported 33
Management Bureau (EMB) of the National Capital million cases.9
Region,2 a study of the Asian Development Bank,3 the
Manila Observatory4 and the Department of Environment Petitioners likewise cite the University of the Philippines'
and Natural Resources5 (DENR) on the high growth and studies in 1990-91 and 1994 showing that vehicular
low turnover in vehicle ownership in the Philippines, emissions in Metro Manila have resulted to the prevalence
including diesel-powered vehicles, two-stroke engine of chronic obstructive pulmonary diseases (COPD); that
powered motorcycles and their concomitant emission of air pulmonary tuberculosis is highest among jeepney drivers;
pollutants, petitioners attempt to present a compelling and there is a 4.8 to 27.5 percent prevalence of respiratory
case for judicial action against the bane of air pollution and symptoms among school children and 15.8 to 40.6 percent
related environmental hazards. among child vendors. The studies also revealed that the
Law on NatRes (73-83 57

children in Metro Manila showed more compromised alternative fuel and avers that unless this law is amended
pulmonary function than their rural counterparts. to provide CNG as alternative fuel for PUVs, the
Petitioners infer that these are mostly due to the emissions respondents cannot propose that PUVs use CNG as
of PUVs. alternative fuel.

To counter the aforementioned detrimental effects of The Solicitor General also adds that it is the DENR that is
emissions from PUVs, petitioners propose the use of tasked to implement Rep. Act No. 8749 and not the
CNG. According to petitioners, CNG is a natural gas LTFRB nor the DOTC. Moreover, he says, it is the
comprised mostly of methane which although containing Department of Energy (DOE), under Section 2616 of Rep.
small amounts of propane and butane,10 is colorless and Act No. 8749, that is required to set the specifications for
odorless and considered the cleanest fossil fuel because it all types of fuel and fuel-related products to improve fuel
produces much less pollutants than coal and petroleum; compositions for improved efficiency and reduced
produces up to 90 percent less CO compared to gasoline emissions. He adds that under Section 2117 of the cited
and diesel fuel; reduces NOx emissions by 50 percent and Republic Act, the DOTC is limited to implementing the
cuts hydrocarbon emissions by half; emits 60 percent less emission standards for motor vehicles, and the herein
PMs; and releases virtually no sulfur dioxide. Although, respondents cannot alter, change or modify the emission
according to petitioners, the only drawback of CNG is that standards. The Solicitor General opines that the Court
it produces more methane, one of the gases blamed for should declare the instant petition for mandamus without
global warming.11 merit.

Asserting their right to clean air, petitioners contend that Petitioners, in their Reply, insist that the respondents
the bases for their petition for a writ of mandamus to order possess the administrative and regulatory powers to
the LTFRB to require PUVs to use CNG as an alternative implement measures in accordance with the policies and
fuel, lie in Section 16,12 Article II of the 1987 Constitution, principles mandated by Rep. Act No. 8749, specifically
our ruling in Oposa v. Factoran, Jr.,13 and Section 414 of Section 218 and Section 21.19 Petitioners state that under
Republic Act No. 8749 otherwise known as the "Philippine these laws and with all the available information provided
Clean Air Act of 1999." by the DOE on the benefits of CNG, respondents cannot
ignore the existence of CNG, and their failure to recognize
Meantime, following a subsequent motion, the Court CNG and compel its use by PUVs as alternative fuel while
granted petitioners' motion to implead the Department of air pollution brought about by the emissions of gasoline
Transportation and Communications (DOTC) as additional and diesel endanger the environment and the people, is
respondent. tantamount to neglect in the performance of a duty which
the law enjoins.
In his Comment for respondents LTFRB and DOTC, the
Solicitor General, cites Section 3, Rule 65 of the Revised Lastly, petitioners aver that other than the writ applied for,
Rules of Court and explains that the writ of mandamus is they have no other plain, speedy and adequate remedy in
not the correct remedy since the writ may be issued only the ordinary course of law. Petitioners insist that the writ in
to command a tribunal, corporation, board or person to do fact should be issued pursuant to the very same Section 3,
an act that is required to be done, when he or it unlawfully Rule 65 of the Revised Rules of Court that the Solicitor
neglects the performance of an act which the law General invokes.
specifically enjoins as a duty resulting from an office, trust
or station, or unlawfully excludes another from the use and In their Memorandum, petitioners phrase the issues before
enjoyment of a right or office to which such other is us as follows:
entitled, there being no other plain, speedy and adequate
remedy in the ordinary course of law.15 Further citing I. WHETHER OR NOT THE PETITIONERS HAVE THE
existing jurisprudence, the Solicitor General explains that PERSONALITY TO BRING THE PRESENT ACTION
in contrast to a discretionary act, a ministerial act, which a
mandamus is, is one in which an officer or tribunal II. WHETHER OR NOT THE PRESENT ACTION IS
performs in a given state of facts, in a prescribed manner, SUPPORTED BY LAW
in obedience to a mandate of legal authority, without
regard to or the exercise of his own judgment upon the III. WHETHER OR NOT THE RESPONDENT IS THE
propriety or impropriety of an act done. AGENCY RESPONSIBLE TO IMPLEMENT THE
SUGGESTED ALTERNATIVE OF REQUIRING PUBLIC
The Solicitor General also notes that nothing in Rep. Act UTILITY VEHICLES TO USE COMPRESSED NATURAL
No. 8749 that petitioners invoke, prohibits the use of GAS (CNG)
gasoline and diesel by owners of motor vehicles. Sadly
too, according to the Solicitor General, Rep. Act No. 8749 IV. WHETHER OR NOT THE RESPONDENT CAN BE
does not even mention the existence of CNG as COMPELLED TO REQUIRE PUBLIC UTILITY VEHICLES
Law on NatRes (73-83 58

TO USE COMPRESSED NATURAL GAS THROUGH A Court's discretion, be set aside in view of the importance
WRIT OF MANDAMUS20 of the issue raised. We brush aside this issue of
technicality under the principle of the transcendental
Briefly put, the issues are two-fold. First, Do petitioners importance to the public, especially so if these cases
have legal personality to bring this petition before us? demand that they be settled promptly.
Second, Should mandamus issue against respondents to
compel PUVs to use CNG as alternative fuel? Undeniably, the right to clean air not only is an issue of
paramount importance to petitioners for it concerns the air
According to petitioners, Section 16,21 Article II of the they breathe, but it is also impressed with public interest.
1987 Constitution is the policy statement that bestows on The consequences of the counter-productive and
the people the right to breathe clean air in a healthy retrogressive effects of a neglected environment due to
environment. This policy is enunciated in Oposa.22 The emissions of motor vehicles immeasurably affect the well-
implementation of this policy is articulated in Rep. Act No. being of petitioners. On these considerations, the legal
8749. These, according to petitioners, are the bases for standing of the petitioners deserves recognition.
their standing to file the instant petition. They aver that
when there is an omission by the government to safeguard Our next concern is whether the writ of mandamus is the
a right, in this case their right to clean air, then, the citizens proper remedy, and if the writ could issue against
can resort to and exhaust all remedies to challenge this respondents.
omission by the government. This, they say, is embodied
in Section 423 of Rep. Act No. 8749. Under Section 3, Rule 65 of the Rules of Court,
mandamus lies under any of the following cases: (1)
Petitioners insist that since it is the LTFRB and the DOTC against any tribunal which unlawfully neglects the
that are the government agencies clothed with power to performance of an act which the law specifically enjoins as
regulate and control motor vehicles, particularly PUVs, and a duty; (2) in case any corporation, board or person
with the same agencies' awareness and knowledge that unlawfully neglects the performance of an act which the
the PUVs emit dangerous levels of air pollutants, then, the law enjoins as a duty resulting from an office, trust, or
responsibility to see that these are curbed falls under station; and (3) in case any tribunal, corporation, board or
respondents' functions and a writ of mandamus should person unlawfully excludes another from the use and
issue against them. enjoyment of a right or office to which such other is legally
entitled; and there is no other plain, speedy, and adequate
The Solicitor General, for his part, reiterates his position remedy in the ordinary course of law.
that the respondent government agencies, the DOTC and
the LTFRB, are not in a position to compel the PUVs to In University of San Agustin, Inc. v. Court of Appeals,25
use CNG as alternative fuel. The Solicitor General we said,
explains that the function of the DOTC is limited to
implementing the emission standards set forth in Rep. Act It is settled that mandamus is employed to compel the
No. 8749 and the said law only goes as far as setting the performance, when refused, of a ministerial duty, this
maximum limit for the emission of vehicles, but it does not being its main objective. It does not lie to require anyone
recognize CNG as alternative engine fuel. The Solicitor to fulfill contractual obligations or to compel a course of
General avers that the petition should be addressed to conduct, nor to control or review the exercise of discretion.
Congress for it to come up with a policy that would compel On the part of the petitioner, it is essential to the issuance
the use of CNG as alternative fuel. of a writ of mandamus that he should have a clear legal
right to the thing demanded and it must be the imperative
Patently, this Court is being asked to resolve issues that duty of the respondent to perform the act required. It never
are not only procedural. Petitioners challenge this Court to issues in doubtful cases. While it may not be necessary
decide if what petitioners propose could be done through a that the duty be absolutely expressed, it must however, be
less circuitous, speedy and unchartered course in an issue clear. The writ will not issue to compel an official to do
that Chief Justice Hilario G. Davide, Jr. in his ponencia in anything which is not his duty to do or which is his duty not
the Oposa case,24 describes as "inter-generational to do, or give to the applicant anything to which he is not
responsibility" and "inter-generational justice." entitled by law. The writ neither confers powers nor
imposes duties. It is simply a command to exercise a
Now, as to petitioners' standing. There is no dispute that power already possessed and to perform a duty already
petitioners have standing to bring their case before this imposed. (Emphasis supplied.)
Court. Even respondents do not question their standing.
This petition focuses on one fundamental legal right of In this petition the legal right which is sought to be
petitioners, their right to clean air. Moreover, as held recognized and enforced hinges on a constitutional and a
previously, a party's standing before this Court is a statutory policy already articulated in operational terms,
procedural technicality which may, in the exercise of the e.g. in Rep. Act No. 8749, the Philippine Clean Air Act of
Law on NatRes (73-83 59

1999. Paragraph (a), Section 21 of the Act specifically No. 290, consistent with E.O. No. 66, series of 2002,
provides that when PUVs are concerned, the responsibility designated the DOE as the lead agency (a) in developing
of implementing the policy falls on respondent DOTC. It the natural gas industry of the country with the DENR,
provides as follows: through the EMB and (b) in formulating emission
standards for CNG. Most significantly, par. 4.5, Section 4
SEC 21. Pollution from Motor Vehicles. - a) The DOTC tasks the DOTC, working with the DOE, to develop an
shall implement the emission standards for motor vehicles implementation plan for "a gradual shift to CNG fuel
set pursuant to and as provided in this Act. To further utilization in PUVs and promote NGVs [natural gas
improve the emission standards, the Department [DENR] vehicles] in Metro Manila and Luzon through the issuance
shall review, revise and publish the standards every two of directives/orders providing preferential franchises in
(2) years, or as the need arises. It shall consider the present day major routes and exclusive franchises to
maximum limits for all major pollutants to ensure NGVs in newly opened routes" A thorough reading of
substantial improvement in air quality for the health, safety the executive order assures us that implementation for a
and welfare of the general public. cleaner environment is being addressed. To a certain
extent, the instant petition had been mooted by the
Paragraph (b) states: issuance of E.O. No. 290.

b) The Department [DENR] in collaboration with the Regrettably, however, the plain, speedy and adequate
DOTC, DTI and LGUs, shall develop an action plan for the remedy herein sought by petitioners, i.e., a writ of
control and management of air pollution from motor mandamus commanding the respondents to require PUVs
vehicles consistent with the Integrated Air Quality to use CNG, is unavailing. Mandamus is available only to
Framework . . . . (Emphasis supplied.) compel the doing of an act specifically enjoined by law as
a duty. Here, there is no law that mandates the
There is no dispute that under the Clean Air Act it is the respondents LTFRB and the DOTC to order owners of
DENR that is tasked to set the emission standards for fuel motor vehicles to use CNG. At most the LTFRB has been
use and the task of developing an action plan. As far as tasked by E.O. No. 290 in par. 4.5 (ii), Section 4 "to grant
motor vehicles are concerned, it devolves upon the DOTC preferential and exclusive Certificates of Public
and the line agency whose mandate is to oversee that Convenience (CPC) or franchises to operators of NGVs
motor vehicles prepare an action plan and implement the based on the results of the DOTC surveys."
emission standards for motor vehicles, namely the LTFRB.
Further, mandamus will not generally lie from one branch
In Oposa26 we said, the right to a balanced and healthful of government to a coordinate branch, for the obvious
ecology carries with it the correlative duty to refrain from reason that neither is inferior to the other.27 The need for
impairing the environment. We also said, it is clearly the future changes in both legislation and its implementation
duty of the responsible government agencies to advance cannot be preempted by orders from this Court, especially
the said right. when what is prayed for is procedurally infirm. Besides,
comity with and courtesy to a coequal branch dictate that
Petitioners invoke the provisions of the Constitution and we give sufficient time and leeway for the coequal
the Clean Air Act in their prayer for issuance of a writ of branches to address by themselves the environmental
mandamus commanding the respondents to require PUVs problems raised in this petition.
to use CNG as an alternative fuel. Although both are
general mandates that do not specifically enjoin the use of In the same manner that we have associated the
any kind of fuel, particularly the use of CNG, there is an fundamental right to a balanced and healthful ecology with
executive order implementing a program on the use of the twin concepts of "inter-generational responsibility" and
CNG by public vehicles. Executive Order No. 290, entitled "inter-generational justice" in Oposa,28 where we upheld
Implementing the Natural Gas Vehicle Program for Public the right of future Filipinos to prevent the destruction of the
Transport (NGVPPT), took effect on February 24, 2004. rainforests, so do we recognize, in this petition, the right of
The program recognized, among others, natural gas as a petitioners and the future generation to clean air. In Oposa
clean burning alternative fuel for vehicle which has the we said that if the right to a balanced and healthful ecology
potential to produce substantially lower pollutants; and the is now explicitly found in the Constitution even if the right
Malampaya Gas-to-Power Project as representing the is "assumed to exist from the inception of humankind, it
beginning of the natural gas industry of the Philippines. is because of the well-founded fear of its framers [of the
Paragraph 1.2, Section 1 of E.O. No. 290 cites as one of Constitution] that unless the rights to a balanced and
its objectives, the use of CNG as a clean alternative fuel healthful ecology and to health are mandated as state
for transport. Furthermore, one of the components of the policies by the Constitution itself, thereby highlighting their
program is the development of CNG refueling stations and continuing importance and imposing upon the state a
all related facilities in strategic locations in the country to solemn obligation to preserve the first and protect and
serve the needs of CNG-powered PUVs. Section 3 of E.O. advance the second, the day would not be too far when all
Law on NatRes (73-83 60

else would be lost not only for the present generation, but
also for those to come. . ."29

It is the firm belief of this Court that in this case, it is timely


to reaffirm the premium we have placed on the protection
of the environment in the landmark case of Oposa. Yet, as
serious as the statistics are on air pollution, with the
present fuels deemed toxic as they are to the environment,
as fatal as these pollutants are to the health of the citizens,
and urgently requiring resort to drastic measures to reduce
air pollutants emitted by motor vehicles, we must admit in
particular that petitioners are unable to pinpoint the law
that imposes an indubitable legal duty on respondents that
will justify a grant of the writ of mandamus compelling the
use of CNG for public utility vehicles. It appears to us that
more properly, the legislature should provide first the
specific statutory remedy to the complex environmental
problems bared by herein petitioners before any judicial
recourse by mandamus is taken.

WHEREFORE, the petition for the issuance of a writ of


mandamus is DISMISSED for lack of merit.

SO ORDERED.