Association of Small Landowners in

the Philippines, Inc. vs Secretary of

Agrarian Reform
These are four consolidated cases questioning the constitutionality of the Comprehensive
Agrarian Reform Act (R.A. No. 6657 and related laws i.e., Agrarian Land Reform Code or
R.A. No. 3844).
Brief background: Article XIII of the Constitution on Social Justice and Human Rights
includes a call for the adoption by the State of an agrarian reform program. The State shall,
by law, undertake an agrarian reform program founded on the right of farmers and regular
farmworkers, who are landless, to own directly or collectively the lands they till or, in the
case of other farmworkers, to receive a just share of the fruits thereof. RA 3844 was
enacted in 1963. P.D. No. 27 was promulgated in 1972 to provide for the compulsory
acquisition of private lands for distribution among tenant-farmers and to specify maximum
retention limits for landowners. In 1987, President Corazon Aquino issued E.O. No. 228,
declaring full land ownership in favor of the beneficiaries of PD 27 and providing for the
valuation of still unvalued lands covered by the decree as well as the manner of their
payment. In 1987, P.P. No. 131, instituting a comprehensive agrarian reform program
(CARP) was enacted; later, E.O. No. 229, providing the mechanics for its (PP131s)
implementation, was also enacted. Afterwhich is the enactment of R.A. No. 6657,
Comprehensive Agrarian Reform Law in 1988. This law, while considerably changing the
earlier mentioned enactments, nevertheless gives them suppletory effect insofar as they
are not inconsistent with its provisions.
[Two of the consolidated cases are discussed below]
G.R. No. 78742: (Association of Small Landowners vs Secretary)
The Association of Small Landowners in the Philippines, Inc. sought exception from the
land distribution scheme provided for in R.A. 6657. The Association is comprised of
landowners of ricelands and cornlands whose landholdings do not exceed 7 hectares. They
invoke that since their landholdings are less than 7 hectares, they should not be forced to
distribute their land to their tenants under R.A. 6657 for they themselves have shown
willingness to till their own land. In short, they want to be exempted from agrarian reform
program because they claim to belong to a different class.
G.R. No. 79777: (Manaay vs Juico)
Nicolas Manaay questioned the validity of the agrarian reform laws (PD 27, EO 228, and
229) on the ground that these laws already valuated their lands for the agrarian reform
program and that the specific amount must be determined by the Department of Agrarian
Reform (DAR). Manaay averred that this violated the principle in eminent domain which
provides that only courts can determine just compensation. This, for Manaay, also violated
due process for under the constitution, no property shall be taken for public use without
just compensation.
Manaay also questioned the provision which states that landowners may be paid for their
land in bonds and not necessarily in cash. Manaay averred that just compensation has
always been in the form of money and not in bonds.
ISSUE:
1. Whether or not there was a violation of the equal protection clause.
2. Whether or not there is a violation of due process.
3. Whether or not just compensation, under the agrarian reform program, must be in terms
of cash.
HELD:
1. No. The Association had not shown any proof that they belong to a different class
exempt from the agrarian reform program. Under the law, classification has been defined
as the grouping of persons or things similar to each other in certain particulars and different
from each other in these same particulars. To be valid, it must conform to the following
requirements:
(1) it must be based on substantial distinctions;
(2) it must be germane to the purposes of the law;
(3) it must not be limited to existing conditions only; and
(4) it must apply equally to all the members of the class.
Equal protection simply means that all persons or things similarly situated must be treated
alike both as to the rights conferred and the liabilities imposed. The Association have not
shown that they belong to a different class and entitled to a different treatment. The
argument that not only landowners but also owners of other properties must be made to
share the burden of implementing land reform must be rejected. There is a substantial
distinction between these two classes of owners that is clearly visible except to those who
will not see. There is no need to elaborate on this matter. In any event, the Congress is
allowed a wide leeway in providing for a valid classification. Its decision is accorded
recognition and respect by the courts of justice except only where its discretion is abused to
the detriment of the Bill of Rights. In the contrary, it appears that Congress is right in
classifying small landowners as part of the agrarian reform program.
2. No. It is true that the determination of just compensation is a power lodged in the courts.
However, there is no law which prohibits administrative bodies like the DAR from
determining just compensation. In fact, just compensation can be that amount agreed
upon by the landowner and the government even without judicial intervention so long as
both parties agree. The DAR can determine just compensation through appraisers and if
the landowner agrees, then judicial intervention is not needed. What is contemplated by
law however is that, the just compensation determined by an administrative body is merely
preliminary. If the landowner does not agree with the finding of just compensation by an
administrative body, then it can go to court and the determination of the latter shall be the
final determination. This is even so provided by RA 6657:
Section 16 (f): Any party who disagrees with the decision may bring the matter to the court of
proper jurisdiction for final determination of just compensation.
3. No. Money as [sole] payment for just compensation is merely a concept in traditional
exercise of eminent domain. The agrarian reform program is a revolutionary exercise of
eminent domain. The program will require billions of pesos in funds if all compensation
have to be made in cash if everything is in cash, then the government will not have
sufficient money hence, bonds, and other securities, i.e., shares of stocks, may be used for
just compensation.

Oposa vs Factoran
Natural and Environmental Laws; Constitutional Law: Intergenerational
Responsibility
GR No. 101083; July 30 1993

FACTS:
A taxpayers class suit was filed by minors Juan Antonio Oposa, et al., representing
their generation and generations yet unborn, and represented by their parents
against Fulgencio Factoran Jr., Secretary of DENR. They prayed that judgment be
rendered ordering the defendant, his agents, representatives and other persons
acting in his behalf to:

1. Cancel all existing Timber Licensing Agreements (TLA) in the country;

2. Cease and desist from receiving, accepting, processing, renewing, or
appraising new TLAs;

and granting the plaintiffs such other reliefs just and equitable under the premises.
They alleged that they have a clear and constitutional right to a balanced and
healthful ecology and are entitled to protection by the State in its capacity as parens
patriae. Furthermore, they claim that the act of the defendant in allowing TLA
holders to cut and deforest the remaining forests constitutes a misappropriation
and/or impairment of the natural resources property he holds in trust for the benefit
of the plaintiff minors and succeeding generations.
The defendant filed a motion to dismiss the complaint on the following grounds:

1. Plaintiffs have no cause of action against him;

2. The issues raised by the plaintiffs is a political question which properly
pertains to the legislative or executive branches of the government.

ISSUE:
Do the petitioner-minors have a cause of action in filing a class suit to prevent the
misappropriation or impairment of Philippine rainforests?
HELD:
Yes. Petitioner-minors assert that they represent their generation as well as
generations to come. The Supreme Court ruled that they can, for themselves, for
others of their generation, and for the succeeding generation, file a class suit. Their
personality to sue in behalf of succeeding generations is based on the concept of
intergenerational responsibility insofar as the right to a balanced and healthful
ecology is concerned. Such a right considers the rhythm and harmony of nature
which indispensably include, inter alia, the judicious disposition, utilization,
management, renewal and conservation of the countrys forest, mineral, land, waters,
fisheries, wildlife, offshore areas and other natural resources to the end that their
exploration, development, and utilization be equitably accessible to the present as
well as the future generations.
Needless to say, every generation has a responsibility to the next to preserve that
rhythm and harmony for the full enjoyment of a balanced and healthful ecology. Put
a little differently, the minors assertion of their right to a sound environment
constitutes at the same time, the performance of their obligation to ensure the
protection of that right for the generations to come.

MMDA v Concerned Residents of Manila Bay (Environmental

Law)
Metropolitan Manila Development Authority v Concerned Residents of
Manila Bay
GR No. 171947-48
December 18, 2008

FACTS:

The complaint by the

residents alleged that the water quality of the Manila Bay had f
allen way
below the allowable standards set by law, specifically Presidentia
l Decree No. (PD) 1152 or the Philippine Environment Code and
that ALL defendants (public officials) must be jointly and/or solidarily
liable and collectively ordered to clean up Manila Bay and to restore its
water quality to class B, waters fit for swimming, diving, and other
forms of contact recreation.

ISSUES:

(1) WON Sections 17 and 20 of PD 1152 under the headings,

Upgrading of Water Quality and Clean-up Operations,
envisage a cleanup in general or are they limited
only to the cleanup of specific pollution incidents;
(2) WON petitioners be compel led by mandamus to clean up and
rehabilitate the Manila Bay.
APPLICABLE LAWS:

PD 1152 Philippine Environmental Code

Section 17. Upgrading of Water Quality.
Where the quality of water has deteriorated t o a degree where
it s state will adversely affect its best u sage, the
government agencies concerned shall
take such measures as may be necessary to upgrade the qual
ity of such water to meet the prescribed water
quality standards. Section 20. Clean-up Operations.
It shall be the responsibility of the polluter to contain , remove
and clean - up water pollution incidents at his own expense. In
case of his failure to do so, the government agencies concerned
shall undertake containment, removal and clean-up operations and
expenses incurred in said operation shall be charged against the
persons and/ or entities responsible for such pollution.

HELD:

(1) Sec. 17 does not in any way state that

the government agencies
concerned ought to confine themselves to the containment,
removal, and cleaning operations when a specific pollution
incident occurs. On the contrary,
Sec. 17 requires them to act even in the absence of a specific
pollution incident, as long as water quality has deteriorated to a
degree where its state will adversely affect its best usage. Section
17 & 20 are of general application and are not for specific pollution
incidents only. The fact that the pollution of the Manila
Bay is of such magnitude and scope that it is well -nigh
impossible to draw the
line between a specific and a general pollution incident.

(2) The Cleaning or Rehabilitation of Manila Bay Can be Compelled by

Mandamus. While the implementation of the
MMDA's mandated tasks may entail a decision-making process,
the enforcement of the law or the very act of doing what the law
exacts to be done is ministerial in nature and may
be compelled by mandamus. Under what other judicial discipline
describes as continuing mandamus , the
Court may, under extraordinary
circumstances, issue directives with the end in view of ensuring
that its decision would not be set to naught by administrative
inaction or indifference.

NOTE: This continuing mandamus is no longer applicable, since this is

institutionalized in the rules of procedure for environmental cases.

20 days Temporary restraining order

Cruz vs Secretary of DENR

Natural Resources and Environmental Law; Constitutional Law; IPRA; Regalian
Doctrine

GR. No. 135385, Dec. 6, 2000

FACTS:
Petitioners Isagani Cruz and Cesar Europa filed a suit for prohibition and mandamus
as citizens and taxpayers, assailing the constitutionality of certain provisions of
Republic Act No. 8371, otherwise known as the Indigenous Peoples Rights Act of
1997 (IPRA) and its implementing rules and regulations (IRR). The petitioners assail
certain provisions of the IPRA and its IRR on the ground that these amount to an
unlawful deprivation of the States ownership over lands of the public domain as well
as minerals and other natural resources therein, in violation of the regalian doctrine
embodied in section 2, Article XII of the Constitution.

ISSUE:
Do the provisions of IPRA contravene the Constitution?

HELD:
No, the provisions of IPRA do not contravene the Constitution. Examining the IPRA,
there is nothing in the law that grants to the ICCs/IPs ownership over the natural
resources within their ancestral domain. Ownership over the natural resources in the
ancestral domains remains with the State and the rights granted by the IPRA to the
ICCs/IPs over the natural resources in their ancestral domains merely gives them, as
owners and occupants of the land on which the resources are found, the right to the
small scale utilization of these resources, and at the same time, a priority in their
large scale development and exploitation.

Additionally, ancestral lands and ancestral domains are not part of the lands of the
public domain. They are private lands and belong to the ICCs/IPs by native title,
which is a concept of private land title that existed irrespective of any royal grant
from the State. However, the right of ownership and possession by the ICCs/IPs of
their ancestral domains is a limited form of ownership and does not include the right
to alienate the same.
Dagdag v. Nepomuceno
G.R. No. L-12691. February 27, 1959 Facts: A small parcel of land (Lot No. 3786), an
alienable or disposable public land. Covered by Sales Patent No. 257 was issued to
Margarita Juanson. The same land was also issued by Lease No. 49
executed by the Bureau of Lands in favor of Andres de Vera. Juansons Sales Patent
was inscribed by the
Register of Deeds on July 11, 1927, and the Original Certificate of Title was issued to
her. In 1950, Simeon Dagdag bought it from the owner and the corresponding
certificate of title was given out. On
the other hand, the lease to de Vera was transferred to Nepomuceno. Dagdags title
and those of his
predecessors contained no annotation of such lease , neither he had any knowledge
of it. Nepomuceno
refused to surrender the land even in the face of Dagdags patent and title.
Issue: Who is entitled to the land and the products thereof? Ruling: The patents
when registered in the corresponding Register of Deeds are indispensible. We
regard these as veritable Torrens Title subject to no encumbrance except those
stated therein, plus those specified by the statutes, and lease is not one of them. In
addition, when the lease was renewed in 1949, the portion in question was no
longer public land subject to the disposition of the Director of Lands because it had
already been granted to Margarita Juanson and had become private property. In
Sec 122 of the Land Registration Law, the documents mentioned wherein lands are
a
lienated, granted,
or conveyed are documents transferring ownership, not documents of lease
transferring ownership.
The Torrens Title of Dagdag must prevail

Francisco Chavez vs Public Estates

Authority (July 2002)
The Public Estates Authority (PEA) is the central implementing agency tasked to undertake
reclamation projects nationwide. It took over the leasing and selling functions of the DENR
(Department of Environmental and Natural Resources) insofar as reclaimed or about to be
reclaimed foreshore lands are concerned.
PEA sought the transfer to the Amari Coastal Bay and Development Corporation, a private
corporation, of the ownership of 77.34 hectares of the Freedom Islands. PEA also sought to
have 290.156 hectares of submerged areas of Manila Bay to Amari.
ISSUE: Whether or not the transfer is valid.
HELD: No. To allow vast areas of reclaimed lands of the public domain to be transferred to
Amari as private lands will sanction a gross violation of the constitutional ban on private
corporations from acquiring any kind of alienable land of the public domain.
The Supreme Court affirmed that the 157.84 hectares of reclaimed lands comprising the
Freedom Islands, now covered by certificates of title in the name of PEA, are alienable
lands of the public domain. The 592.15 hectares of submerged areas of Manila Bay remain
inalienable natural resources of the public domain. The transfer (as embodied in a joint
venture agreement) to AMARI, a private corporation, ownership of 77.34 hectares of the
Freedom Islands, is void for being contrary to Section 3, Article XII of the 1987 Constitution
which prohibits private corporations from acquiring any kind of alienable land of the public
domain. Furthermore, since the Amended JVA also seeks to transfer to Amari ownership of
290.156 hectares of still submerged areas of Manila Bay, such transfer is void for being
contrary to Section 2, Article XII of the 1987 Constitution which prohibits the alienation of
natural resources other than agricultural lands of the public domain.

Republic vs Naguiat
Natural Resources and Environmental Laws

G.R. No. 134209; January 24, 2006

FACTS:
Celestina Naguiat filed an application for registration of title to four parcels of land
located in Panan, Botolan, Zambales. The applicant alleges that she is the owner of
the said parcels of land having acquired them by purchase from its previous owners
and their predecessors-in-interest who have been in possession thereof for more
than thirty (30) years; and that to the best of her knowledge, said lots suffer no
mortgage or encumbrance of whatever kind nor is there any person having any
interest, legal or equitable, or in possession thereof.
Petitioner Republic opposed on the ground that neither the applicant nor her
predecessors-in interest have been in open, continuous, exclusive and notorious
possession and occupation of the lands in question since 12 June 1945 or prior
thereto, considering the fact that she has not established that the lands in question
have been declassified from forest or timber zone to alienable and disposable
property.

ISSUE:
Did the areas in question cease to have the status of forest or other inalienable lands
of the public domain?

HELD:
No, the said areas are still classified as forest land.The issue of whether or not
respondent and her predecessors-in-interest have been in open, exclusive and
continuous possession of the parcels of land in question is of little moment. For,
unclassified land cannot be acquired by adverse occupation or possession;
occupation thereof in the concept of owner, however long, cannot ripen into private
ownership and be registered as title.
A forested area classified as forest land of the public domain does not lose such
classification simply because loggers or settlers have stripped it of its forest cover.
Parcels of land classified as forest land may actually be covered with grass or planted
to crops by kaingin cultivators or other farmers. "Forest lands" do not have to be on
mountains or in out of the way places. The classification is merely descriptive of its
legal nature or status and does not have to be descriptive of what the land actually
looks like.
 ramos-balalio vs ramos
DECISION
YNARES-SANTIAGO, J.:

This petition assails the Decision[1] of the Court of Appeals dated February
16, 2005 in CA-G.R. CV No. 58644 reversing the Decision[2] of the
Regional Trial Court (RTC) of Roxas, Isabela, Branch 23, dated July 17,
1996, in Civil Case No. Br. 23-357 which ruled that herein petitioner
Zenaida Ramos-Balalio had a superior right to possess Lot No. 204, Pls-15,
situated at Muoz, Roxas, Isabela, as well as its Resolution[3] dated June 14,
2005 denying the motion for reconsideration.

As culled from the records, petitioner Zenaida and her brother Alexander
(now deceased) are the children of spouses Susana Bueno and Abundio
Ramos. The spouses started occupying Lot No. 204 in 1938. Abundio died
in 1944. Susana met her second husband, respondent Eusebio Ramos in
1946, with whom she had five children, one of whom is respondent Rolando.

In the interim, prior to 1958, Susana discovered that Felimon Domingo

applied for a sales patent over the subject parcel of land which she opposed.
The Bureau of Lands resolved the dispute, thus:

In the light of the foregoing facts, it is clear that Felimon B.

Domingo has not entered, possessed or cultivated the land in
question and therefore he has not acquired any preference right
thereto. Upon the other hand contestant Susana Bueno Vda. de
Ramos and her children have sufficiently established their right of
preference over the land except the one hectare Cemetery site, on
the basis of their continuous occupation and cultivation and their
valuable improvements introduced thereon.
 Wherefore, it is ordered that the Sales Application No. 21992 of
Felimon B. Domingo be as hereby it is rejected, forfeiting in favor of the
Government whatever amount have been paid on account thereof. The
land in question shall be subdivided so as to exclude therefrom the one
hectare portion in the northwestern part of the land, which shall be
reserved as barrio cemetery site, while the remaining area is hereby
allocated to SUSANA BUENO VDA DE RAMOS who shall file an
appropriate application therefore within sixty (60) days after the survey
thereof at her own expense, it not appearing that this Office has received
the homestead (new) application allegedly filed by her for the same land.

SO ORDERED.[4]
It was alleged that as Susana accompanied her husband Eusebio, a soldier,
wherever he was assigned, Susanas father, George Bueno, and daughter,
petitioner Zenaida continued the cultivation and possession of the subject
land. Sometime later, Susana sold the land to petitioner who, in turn,
partitioned it among herself, her brother, Alexander, and respondent
Rolando and his siblings. The partition was not registered but Deeds of Sale
were executed in favor of Rolando and Alexander.

Petitioner thereafter mortgaged her share; however, it came to her

knowledge that respondents Rolando and Eusebio had usurped her share and
deprived the mortgagees of possession over the land. After settling the
mortgage, petitioner filed a case for recovery of inheritance, possession and
damages with a petition for preliminary mandatory injunction.

The trial court had the land surveyed. Subdividing the land into Lots 204-A
to 204-H[5] based on the actual possessor or occupant, the survey plan
revealed the following:

1. Plaintiff Zenaida Ramos Balalio has no possession, occupation,

and cultivation whatsoever of lot 204, Pls-15;
2. Rolando Ramos is in possession and cultivation of lot 204-F,
lot 204-G and lot 204-C, with a total area of 43,957 sq. m.,
more or less;
 3. Eusebio Ramos is occupying and cultivating lot 204-A with an
area of 4,994 sq. m., more or less;
4. Lot 204-B consisting of 17,685 sq. m., more or less, is
possessed and cultivated by Evangelisto Garcia, another
intervenor. His occupation is very much less than the two
(2) hectares sold to him by Alexander Ramos. It is short by
2,311 sq. m., more or less;
5. The total area of the land in question, after deducting one (1)
hectare occupied by the cemetery is 73,150 sq. m., more or
less.[6]

On July 17, 1996, the trial court rendered its decision holding that
petitioner was deprived of her right to cultivation and possession of her
share of Lot No. 204 and thus ruled:

AS A CONSEQUENCE OF ALL THE FOREGOING, judgment is

hereby rendered in favor of plaintiff, Zenaida Ramos and against Rolando
Ramos, defendant, and Eusebio Ramos, intervenor.

1. Ordering Eusebio Ramos to vacate lot 204-A and surrender it to

Evangelisto Garcia because he is not entitled to any portion of the lot in
question, it being the conjugal property of the first marriage of Susana
Bueno to Abundio Ramos;

2. Evangelisto Garcia is adjudicated the first two (2) hectares from

the North and East of the cemetery, as he validly bought the area from
Alexander Ramos. He is presently occupying only 17,689 sq. m., more or
less. His possession now is increased to two (2) hectares which includes
the area being possessed by Eusebio Ramos;

3. The remaining portion of the share of Alexander Ramos is 4,410

sq. m., more or less. This is adjudicated in favor of his heirs. This portion
now corresponds to the area immediately South of the area of Evangelisto
Garcia, the partition being from East to West;

4. The middle portion consisting of 24,410 sq. m., more or less,

and immediately South of the cemetery, and also South of the portion
adjudicated to the heirs of Alexander is now given to Zenaida Ramos
Balalio as her valid share of lot 204, the partition being also East to West;

5. South of the share of Zenaida consisting also of 24,410 sq. m.,

more or less, is the valid share of Rolando Ramos and his full blooded
 brother and sisters namely Robin, Corazon, Myrna and Mila, all surnamed
Ramos;

6. Rolando Ramos and Eusebio Ramos are ordered jointly and

severally to pay Zenaida Ramos:

a. Ten Thousand (P10,000.00) Pesos as attorneys fees;

b. One thousand Five Hundred (P1,500.00) Pesos as
appearance fees of her lawyer;
c. Ten Thousand (P10,000.00) Pesos as incidental expenses
relative to the case;
d. One Hundred Thousand Eight Hundred (P100,800.00)
Pesos as the reasonable owners share of the produce
of the land of Zenaida Ramos from 1975 to the
present, with an interest of 6% per annum until fully
paid;

7. The Clerk of Court and the Sheriff are ordered to repair to the
land in question and partition said land in accordance with the tenor of this
decision;

8. And to pay the cost.

SO ORDERED.[7]

On appeal, the Court of Appeals found that neither Zenaida nor Alexander
complied with the homestead application requirements in order to acquire
superior vested right. As a consequence, it reversed the decision of the trial
court, to wit:

As a consequence of the foregoing, the Court rules in favor

of appellants as to the fourth error and finds that the contract
supposedly dividing that property among Zenaida, Rolando
Ramos and Alexander Ramos cannot be enforced because neither
of the parties therein can claim any vested right over the subject
parcel land which is still part of the public domain.

Also, prescinding from the above ruling, the intervention of

Eusebio Ramos and Evangelisto Garcia should likewise be dismissed. As
to Eusebio, since Susana never filed an application for homestead, her
right never ripened to ownership which she could have transmitted to her
heirs. As to Evangelisto Garcia who supposedly purchased that share of
Alexander (an heir of Susana), since the vendor never inherited anything
 from Susana there was nothing which he (Evangelisto) could have bought.
In fine, neither of the intervenors could claim any right which they can
enforce in court.

WHEREFORE, the Decision of the Regional Trial Court of Roxas,

Isabela, Branch 23, in Civil Case No. Br. 23-357 is REVERSED and the
Complaint filed by plaintiff-appellee as well as the respective Answer in
Intervention of Eusebio Ramos and Evangelisto Garcia are all hereby
ordered DISMISSED.

SO ORDERED.[8]

Hence, this petition on the following assigned errors:

7.1. THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED

IN REVERSING THE TRIAL COURTS DECISION AND
DISMISSING THE PETITIONERS COMPLAINT.

7.2. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN

HOLDING THAT PETITIONER IS NOT IN PRIOR
POSSESSION OF THE SAID LAND, AND DECLARING THAT
SHE HAS NO RIGHT WHATSOEVER TO THE DISPUTED
LAND.

7.3. THE HONORABLE COURT OF APPEALS ERRED IN IGNORING

THE ISSUE OF ACCION PUBLICIANA IN THE CASE AT
BAR AND CONFINED ITSELF TO THE CLAIM OF
RECOVERY OF INHERITANCE.[9]
The petition is partly meritorious.

Under the Regalian doctrine, all lands of the public domain belong to the
State and those lands not appearing to be clearly within private ownership
are presumed to belong to the State.[10] Lands of the public domain are
classified into agricultural, forest or timber, mineral lands, and national
parks. Alienable lands of the public domain shall be limited to agricultural
lands.[11]

Commonwealth Act No. 141 (1936), or the Public Land Act, as amended by
Presidential Decree No. 1073 (1977), remains to be the general law
governing the classification and disposition of alienable lands of the public
domain. It enumerates the different modes of acquisition of these lands and
prescribes the terms and conditions to enable private persons to perfect their
title to them. It is, therefore, the applicable law to the case before us.

A homestead patent, such as the subject of the instant case, is one of the
modes to acquire title to public lands suitable for agricultural purposes.
Under the Public Land Act, a homestead patent is one issued to any citizen
of this country, over the age of 18 years or the head of a family, and who is
not the owner of more than 24[12] hectares of land in the country.[13] To be
qualified, the applicant must show that he has resided continuously for at
least one year in the municipality where the land is situated and must have
cultivated at least one-fifth of the land applied for.[14]

In the case at bar, petitioner Zenaida asserts her right to a parcel of

agricultural land that her parents Susana and Abundio had possessed since
1938. She claims that, for some time, the cultivation of this land was left to
her and her grandfather and that, following the death of her father Abundio,
the land was allegedly sold to her by her mother Susana.

Zenaidas argument is flawed because it assumes that her parents had

perfected their title over the land and that they could validly convey the
same to third persons, whether by sale or by inheritance. However, a careful
examination of the records shows that petitioner has not satisfactorily
established that a valid application for homestead patent was filed by her
parents. The decision of the Bureau of Lands in 1958 only addressed
Zenaidas familys right of preference over the land, in view of their
possession and cultivation of the land. Nonetheless, the Bureau of Lands
ordered the filing of an appropriate application for its registration which
indicates that as of that time, there was as yet no valid application filed.[15]
 The purported sale, therefore, between petitioner and her mother
cannot be given effect, nor can it be a source of right for Zenaida, because
Susana did not have the authority to sell what did not belong to her. The
invalidation of the sale consequently nullifies the partition of the property
among Zenaida, Alexander, and Rolando and his siblings because Zenaida
could not have disposed of the land which she did not own.

For the same reason, neither Eusebio nor Rolando can claim any right
whatsoever as heirs of Susana. Their claim evidently relies on the provision
of the Public Land Act which states:

Section 105. If at any time the applicant or grantee shall die before
the issuance of the patent or the final grant of the land, or during the life of
the lease, or while the applicant or grantee still has obligations pending
towards the Government, in accordance with this Act, he shall be
succeeded in his rights and obligations with respect to the land
applied for or granted or leased under this Act by his heirs in law, who
shall be entitled to have issued to them the patent or final concession if
they show that they have complied with the requirements therefor,
and who shall be subrogated in all his rights and obligations for the
purposes of this Act. (Emphasis added)

The reliance is misplaced because the cited provision speaks of

an applicant, grantee, or lessee. Susana was not one of these. In her lifetime,
despite her possession and cultivation of the land, she failed to apply for a
homestead patent and to acquire any vested right that Eusebio or Rolando
can inherit. As such, the land remains part of the public domain.
Furthermore, Eusebio and Rolando cannot invoke their prior possession and
occupation of the land because the same cannot be considered as adverse,
open, public, peaceful and to the exclusion of all.
Hence, the subject land remains to be part of the public domain and
rightfully belongs to the State. As held by the Court of Appeals, none of the
parties obtained a defensible title to the property which can be upheld by the
Court. Nonetheless, the possession of the land is different from the issue of
its ownership. Petitioner argues that her petition may be treated as an accion
publiciana and not merely an action for recovery of inheritance.

An accion publiciana is an action for the recovery of the right to

possess and is a plenary action in an ordinary civil proceeding to determine
the better right of possession of realty independently of title.[16] In this case,
the issue is whether Zenaida, as an applicant for public land, may be
considered as having any right to the land occupied, which may entitle her to
sue in courts for the return of the possession thereof.

We find that Zenaida has proven prior possession of the portion of

land she claims as her share, which possession antedates the filing of the
homestead application. She produced evidence showing that she has filed a
verified application for the registration of the land with the Bureau of Lands
on August 10, 1971,[17] which is still pending. The documents remain
uncontested and the application has not been assailed by any of the parties to
the case. She alleged that during the lifetime of her mother, she and her
maternal grandfather cultivated and occupied the land.
Moreover, Zenaida presented tax declarations both in her name and
that of her predecessor-in-interest (mother Susana Bueno) covering the
property. Time and again, we have held that although tax declarations or
realty tax payments of property are not conclusive evidence of ownership,
nevertheless, they are good indicia of possession in the concept of owner for
no one in his right mind would be paying taxes for a property that is not in
his actual or at least constructive possession.[18] They constitute at least proof
that the holder has a claim of title over the property. The voluntary
declaration of a piece of property for taxation purposes manifests not only
ones sincere and honest desire to obtain title to the property and announces
his adverse claim against the State and all other interested parties, but also
the intention to contribute needed revenues to the Government.[19]

All told, petitioner Zenaidas uncontested and verified application for a

homestead patent coupled with her open and notorious occupation of the
land convinces us of her preferential right to possess the land claimed, which
entitles her to be protected by the law in such possession.

WHEREFORE, the petition is PARTIALLY GRANTED. The

Decision of the Court of Appeals dated February 16, 2005 is MODIFIED,
insofar as to grant petitioner Zenaida Ramos-Balalio preferential possession
of the portion of Lot 204, Pls-15, situated in Muoz, Roxas, Isabela, as
delineated in the Decision of the Regional Trial Court of Roxas, Isabela,
Branch 23, dated July 17, 1996.

SO ORDERED.

seville vs. national development company

DECISION
PANGANIBAN, J.:

Unless a public land is shown to have been reclassified as alienable or

actually alienated by the State to a private person, that piece of land remains
part of the public domain. Hence, occupation thereof, however long, cannot
ripen into ownership.

The Case

Before us is a Petition for Review on Certiorari assailing the November 29,

1996 Decision of the Court of Appeals[1] (CA), as well as the May 19, 1997 CA
Resolution[2] denying the Motion for Reconsideration. The dispositive part of
the CA Decision reads as follows:
WHEREFORE, the appealed decision is REVERSED and SET
ASIDE. Another judgment is hereby rendered dismissing the complaint. The
counterclaims of appellants are denied. Costs against plaintiffs-appellees.[3]

The Facts

The appellate court narrated the undisputed facts in this manner:

1. By virtue of Presidential Decree No. 625, Leyte Sab-A Basin Development

Authority (LSBDA) was created to integrate government and private sector
efforts for a planned development and balanced growth of the Sab-a Basin in
the [P]rovince of Leyte, empowered to acquire real property in the successful
prosecution of its business. Letter of Instruction No. 962 authorized LSBDA to
acquire privately-owned lands circumscribed in the Leyte Industrial
Development Estate (LIDE) by way of negotiated sales with the landowners.

2. On June 14, 1980, [Respondent] Calixtra Yap sold to LSBDA Lot No. 057
SWO 08-000047 consisting of 464,920 square meters, located at Barangay Sto.
Rosario, Isabel, Leyte, covered under Tax Declarations Nos. 3181, 3579, 3425,
1292 and 4251 under the name of said vendor.

3. On June 1, 1982, appellant LSBDA filed a Miscellaneous Sales Application

with the Bureau of Lands covering said lot together with other lots acquired by
LSBDA with an aggregate area of 442, 7508 square meters.

4. After due notice and investigation conducted by the Bureau of Lands,

Miscellaneous Sales Patent No. 9353 was issued in the name of [Respondent]
LSBDA on the basis of which Original Certificate of Title No. P-28131 was
transcribed in the Registration Book for the [P]rovince of Leyte on August 12,
1983 in the name of [Respondent] LSBDA. On December 14, 1989, LSBDA
assigned all its rights over the subject property to its [Co-respondent] National
Development Company (NDC) as a result of which a new Transfer Certificate
of Title was issued on March 2, 1990 by the Registry of Deeds for the province
of Northern Leyte in the name of NDC. The subject property was leased to
[Respondents] Philippine Associated Smelting & Refining Corporation
(PASAR), Philippine Phosphate Fertilizer Corporation (PHILPHOS) and
Lepanto Consolidated Mining Co., Inc. (LEPANTO).

5. On November 29, 1988, the Estate of Joaquin Ortega represented by judicial

administrator Felipe Seville filed with the Regional Trial Court (Branch 12) of
Ormoc City, a complaint for recovery of real property, rentals and damages
against the above-named [respondents] which complaint was later on amended
on May 11, 1990. [Respondents] filed their respective Answers. After trial, the
trial court rendered judgment the dispositive portion of which reads as follows:

WHEREFORE, [a] decision is hereby rendered for [petitioners] and against

[respondents].

1. The Deed of Sale executed by Calixtra Yap on June 14, 1980 in favor of
LSBDA, (Exhibit PP and 25) conveying the subject property to said LSBDA is
declared NULL and VOID ab initio;

2. The intestate estate of JOAQUIN ORTEGA is declared the owner in fee

simple of the 735,333 square meters real property subject of the present action
and defendant NDC is ordered to segregate the same area from OCT P-28131
and CONVEY the same to the Estate of Joaquin Ortega;

3. Upon the segregation of the 735,333 square meters from OCT No. P-28131
the Register of Deeds of the Province of Leyte is ordered to issue a new title to
the said portion in the name of the Intestate Estate of Joaquin Ortega;

4. [Respondents] LSBDA, NDC, PASAR, are ordered to pay jointly and

severally to [petitioners] the sum of FOUR MILLION SEVEN HUNDRED
EIGHTY FOUR THOUSAND EIGHT HUNDRED FORTY SIX PESOS
(P4,784,846.00) as rentals due from 1979 to the present, plus accrued interest
pursuant to par. 2 of the Lease Contract between NDC and PASAR. (Exhibit
54)

5. [Respondents] LSBDA, NDC, and PHILPHOS are also ordered to pay

jointly and severally [petitioners] the sum of TWO MILLION EIGHTY SIX
THOUSAND THREE HUNDRED NINETY EIGHT PESOS AND SIXTY
CENTAVOS (P2,086,398.60) as accrued rentals of PHILPHOS from 1979 to
present, plus the accrued interest for non-payment pursuant to paragraph 2 of
the same Lease Contract cited above;

6. [Respondents] are ordered to pay jointly and severally [petitioners]

P200,000.00 as indemnity for the value of the ancestral home;

7. [Respondents] are also ordered to pay jointly and severally [petitioners] the
sum of P250,000.00 as reimbursement for attorneys fees and the further sum of
P50,000.00 as expenses for litigation;
8. Finally, [petitioners] and [respondents] are ordered to sit down together and
discuss the possibility of a compromise agreement on how the improvements
introduced on the landholding subject of the present suit should be disposed of
and for the parties to submit to this Court a joint manifestation relative
thereto.In the absence of any such compromise agreement, such improvements
shall be disposed of pursuant to Article 449 of the New Civil Code.

Costs against [respondents].

SO ORDERED.[4]

Ruling of the Court of Appeals

Citing the Regalian doctrine that lands not appearing to be privately owned
are presumed to be part of the public domain, the CA held that, first, there was
no competent evidence to prove that the property in question was private in
character. Second, possession thereof, no matter how long, would not ripen into
ownership, absent any showing that the land had been classified as
alienable. Third, the property had been untitled before the issuance of the
Miscellaneous Sales Patent in favor of the LSBDA. Fourth, petitioners were
guilty of laches, because they had failed to apply for the judicial confirmation
of their title, if they had any. Fifth, there was no evidence of bad faith on the
part of LSBDA in dealing with Yap regarding the property.
Hence, this Petition.[5]

The Issues

In their Memorandum, petitioners submit the following issues for the

consideration of the Court:[6]

A. Whether or not the sale by Calixtra Yap of the Estate of the Late Joaquin
Ortega in favor of LSBDA was null and void.

B. Whether or not the issuance of a Miscellaneous Sales Patent and an Original

Certificate of Title in favor of LSBDA was valid.

C. Whether or not petitioners are guilty of laches.

D. Whether or not petitioners are entitled to the remedy of reconveyance and
the damages awarded by the trial court.

In the main, the Court is called upon to determine the validity of LSBDAs
title. In resolving this issue, it will also ascertain whether, before the issuance
of the title, the land was private or public.

The Courts Ruling

The Petition has no merit.

Main Issue:
Validity of LSBDAs Title

Petitioners argue that LSBDAs title to 73 hectares of the 402-hectare Leyte

Industrial Development Estate was void, having allegedly been obtained from
Calixtra Yap who had no right to it. They maintain that they acquired title to
the disputed property by acquisitive prescription, because they and their
predecessors in interest had been in possession of it for more than thirty
years.[7] Although it was the subject of settlement proceedings, petitioners
further claim that Yap sold the same to LSBDA without the permission of the
trial court.
Disputing these contentions, respondents and the appellate court maintain
that petitioners have not shown that the land had previously been classified as
alienable and disposable. Absent such classification, they argue that possession
of it, no matter how long, could not ripen into ownership.
We agree with respondents and the appellate court. First. There was no
showing that the land had been classified as alienable before the title was
issued to LSBDA; hence, petitioners could not have become owners thereof
through acquisitive prescription. Second, petitioners challenge to LSBDAs title
cannot be granted, because it is based on a wrong premise and amounts to a
collateral attack, which is not allowed by law.

Public Character of the Land

Under the Regalian doctrine, all the lands of the public domain belong to
the State, which is the source of any asserted right to ownership of land. All
lands not otherwise appearing to be clearly within private ownership are
presumed to belong to the State.[8] In Menguito v. Republic,[9] the court held that
[u]nless public land is shown to have been reclassified or alienated to a private
person by the State, it remains part of the inalienable public domain. Indeed,
occupation thereof in the concept of owner, no matter how long, cannot ripen
into ownership and be registered as a title. To overcome such presumption,
incontrovertible evidence must be shown by the applicant. Absent such
evidence, the land sought to be registered remains inalienable.
A person in open, continuous, exclusive an notorious possession of a public
land for more than thirty years acquires an imperfect title thereto. That title may
be the subject of judicial confirmation, pursuant to Section 48 of the Public
Land Act, which provides:

SECTION 48. The following described citizens of the Philippines, occupying

lands of public domain or claiming to own any such lands or an interest
thereon, but whose titles have not been perfected or completed, may apply to
the Court of First Instance of the province where the land is located for
confirmation of their claims, and the issuance of a certificate of title therefore,
under the Land Registration Act, to wit:

xxx xxx xxx

(b) those who by themselves or through their predecessor in-interest have been
in open, continuous, exclusive and notorious possession and occupation of
agricultural lands of the public domain, under a bona fide claim of acquisition
or ownership, for at least thirty years immediately preceding the filing of the
application for confirmation of title except when prevented by war or force
majeure. They shall be conclusively presumed to have performed all the
conditions essential to a Government grant and shall he entitled to a certificate
of title under the provisions of this Chapter.

Under Section 4 of Presidential Decree (PD) No. 1073,[10] paragraph b of the

aforecited provision applies only to alienable and disposable lands of the public
domain. The provision reads:

SEC. 4. The provisions of Section 48 (b) and Section 48 (c), Chapter VIII, of
the Public Land Act, are hereby amended in the sense that these provisions
shall apply only to alienable and disposable lands of the public domain which
have been in open, continuous, exclusive and notorious possession and
occupation by the applicant himself or thru his predecessor-in-interest, under a
bona fide claim of acquisition of ownership, since June 12, 1945.
 It should be stressed that petitioners had no certificate of title over the
disputed property. Although they claim that their title was based on acquisitive
prescription, they fail to present incontrovertible proof that the land had
previously been classified as alienable. They simply brush aside the conclusion
of the CA on this crucial point by saying that it was without factual
basis.[11] Instead, they maintain that the private character of the land was
evidenced by various tax declarations, Deeds of Sale, and Decisions of the trial
court and even the Supreme Court.[12]
Petitioners arguments are not convincing. Tax declarations are
not conclusive proofs of ownership, let alone of the private character of the
land. At best, they are merely indicia of a claim of ownership.[13] In Spouses
Palomo v. CA,[14] the Court also rejected tax declarations as proof of private
ownership, absent any showing that the forest land in question had been
reclassified as alienable.
Moreover, the Deeds of Sale of portions of the disputed property, which
Joaquin Ortega and several vendors executed, do not prove that the land was
private in character. The question remains: What was the character of the land
when Ortega purchased it? Indeed, a vendee acquires only those rights
belonging to the vendor. But petitioners failed to show that, at the time, the
vendors were already its owners, or that the land was already classified as
alienable.
Also misplaced is petitioners reliance on Ortega v. CA,[15] in which the
Supreme Court allegedly recognized the private character of the disputed
property. In that case, the sole issue was whether the respondent judge xxx
acted in excess of jurisdiction when he converted Civil Case No. 1184-O, an
action for quieting of title, declaration of nullity of sale, and annulment of tax
declaration of a parcel of land, into an action for the declaration of who is the
legal wife, who are the legitimate children, if any, and who are the compulsory
heirs of the deceased Joaquin Ortega.[16] The Court did not all make any ruling
that the property had been classified as alienable.
In any event, Ortega arose from a suit for quieting of title, an action quasi
in rem that was binding only between the parties.[17] The present respondents as
well as the Bureau of Lands, which subsequently declared that the land was
public, are not bound by that ruling, because they were not impleaded therein.
While petitioners refer to the trial court proceedings supposedly
recognizing the private character of the disputed property, they make no claim
that these cases directly involve the classification of the land, or that the Bureau
of Lands is a party thereto.
 Clearly, the burden of proof that the land has been classified as alienable is
on the claimant.[18] In the present case, petitioners failed to discharge this
burden. Hence, their possession of the disputed property, however long, cannot
ripen into ownership.

LSBDAs Title

Equally unmeritous is the argument of petitioners that the title of LSBDA is

void. As earlier stated, they claim that such title was derived from Calixtra Yap,
who was allegedly not the owner of the property. Petitioners assume that
LSBDA, having acquired the rights of Yap, resorted to a confirmation of her
imperfect title under Section 48 of the Public Land Act. This argument is
devoid of factual or legal basis.
Petitioners fail to consider that the title of LSBDA was based, not on the
conveyance made by Yap, but on Miscellaneous Sales Patent No. 9353 issued
by the director of the Bureau of Lands. In fact, after LSBDA had filed an
application for patent, the Bureau of Lands conducted an investigation and
found that the land was part of the public domain. After compliance with the
notice and publication requirements, LSBDA acquired the property in a public
auction conducted by the Bureau of Lands.[19]
Petitioners insist, however, that LSBDA was estopped from claiming that
the land was public, because the Deed of Sale executed by Yap in its favor
stipulated that the seller is the absolute owner in fee simple of the xxx
described property.[20] It is scarcely necessary to address this point. To begin
with, the power to classify a land as alienable belongs to the State, not to
private entities. Hence, the pronouncements of Yap or LSBDA cannot effect
the reclassification of the property. Moreover, the assailed misrepresentation
was made by Yap as seller. Hence, objections thereto should be raised not by
petitioners but by LSBDA, the contracting party obviously aggrieved.
In any case, the actions of LSBDA after Yaps conveyance demonstrated its
position that the disputed land was part of the public domain. That this was so
can be inferred from LSBDAs subsequent application for a Miscellaneous Sales
Patent and, in a public auction, its purchase of the property from the Bureau of
Lands. Indeed, Yap merely conveyed a claim, not a title which she did not
have.

Collateral Attack
 There is another reason for denying the present Petition. Petitioners insist
that they are not seeking the re-opening of a decree under the Torrens
system.Supposedly, they are only praying for the segregation of 735,333 square
meters of land, or 73 hectares more or less from the OCT No. P-28131 issued
to LSBDA.[21] This disputation is mere quibbling over the words, plain and
simple.
Semantics aside, petitioners are effectively seeking the modification of
LSBDAs OCT, which allegedly encompassed even a parcel of land allegedly
belonging to them. Hence, the present suit, purportedly filed for the recovery of
real property and damages, is tantamount to a collateral attack not sanctioned
by law. Section 48 of PD 1529, the Property Registration Decree, expressly
provides:

SEC. 48. Certificate not subject to collateral attack. -- A certificate of title shall
not be subject to collateral attack. It cannot be altered, modified, or cancelled
except in a direct proceeding in accordance with law.

It has been held that a certificate of title, once registered, should not
thereafter be impugned, altered, changed, modified, enlarged or diminished,
except in a direct proceeding permitted by law. Otherwise, the reliance on
registered titles would be lost.[22]
Moreover, the title became indefeasible and incontrovertible after the lapse
of one year from the time of its registration and issuance. [23] Section 32 of PD
1529 provides that [u]pon the expiration of said period of one year, the decree
of registration and the certificate of title shall become incontrovertible. Any
person aggrieved buy such decree of registration in any case may pursue his
remedy by action for damages against the applicant or other persons
responsible for the fraud. Although LSBDAs title was registered in 1983,
petitioners filed the amended Complaint only in 1990.

Reconveyance

Petitioners also claim that the disputed property should be reconveyed to

them. This cannot be allowed. Considering that the land was public before the
Miscellaneous Sales Patent was issued to LSBDA, petitioners have no standing
to ask for the reconveyance of the property to them. The proper remedy is an
action for reversion, which may be instituted only by the Office of the Solicitor
General, pursuant to section 101 of the Public Land Act, which reads as
follows:
SEC. 101. All actions for the reversion to the Government of lands of the
public domain or improvements thereon shall be instituted by the Solicitor
General or the officer acting in his stead, in the proper courts, in the name of
the [Republic] of the Philippines.

Verily, the prayer for reconveyance and, for that matter, the entire case of
petitioners rest on the theory that they have acquired the property by acquisitive
prescription; and that Yap, without any right or authority, sold the same to
LSBDA.

Conclusion

In the light of our earlier disquisition, the theory has no leg to stand
on. Absent any showing that the land has been classified as alienable, their
possession thereof, no matter how lengthy, cannot ripen into ownership. In
other words, they have not become owners of the disputed property. Moreover,
LSBDAs title was derived from a Miscellaneous Sales Patent, not from
Yap. Finally, petitioners cannot, by a collateral attack, challenge a certificate of
title that has already become indefeasible and incontrovertible.
If petitioners believe that they have been defrauded by Yap, they should
seek redress, not in these proceedings, but in a proper action in accordance with
law.
WHEREFORE, the Petition is hereby DENIED and the assailed Decision
AFFIRMED. Costs against petitioners.
SO ORDERED.
Case #
5

REPUBLIC OF THE PHILIPPINES VS CANDY MAKER, INC.

(GR.NO. 163766, June. 22, 2006)
Facts:
On April, 29, 1999, Antonia, Eladia, and Felisa, all surnamed Cruz, executed aDeed of
Absolute Sale in favor of Candy Maker, Inc. for a parcel of land located belowthe
reglementary lake elevation of 12.50m, about 900 meters away the Laguna de
Bay.Candy Maker, Inc. as applicant, filed an application with the MTC of Taytay, Rizal
for
registration of its alleged title over the lot.
The CENRO of Antipolo City declared the land to fall within the alienable
anddisposable zone. On the otherhand, the Land Registration Authority
recommended theexclusion of lot no. 3138-B on the ground that it is a legal
easement and intended forpublic use, hence, inalienable and indisposable. On July
2001, the Republic of the
Philippines, the LLDA filed its opposition
which alleged that the lot subject of theapplication for registration may not be
alienated and disposed since it is considered part
of the Laguna Lake Bed, a public land within, its jurisdiction.

Issue
:Whether the property subject of the amended application is alienable
anddisposable property of the State, and if so, whether respondent adduced the
requisite
quantum of evidence to prove its ownership over the property?

Held:
The property subject of this application was alienable and disposable
publicagricultural land. However, respondent failed to prove that it possesses
registrable titleover the property. The statute of limitations with regard to public
agricultural lands doesnot operate against the statute unless the occupant proves
possession and occupationof the same after a claim of ownership for the required
number of years to constitute agrant from the State.A mere casual cultivation of
portions of the land by the claimant does notconstitute sufficient basis for a claim of
ownership, such possession is not exclusive andnotorious as to give rise to
presumptive grant from the state.In light of the foregoing, the petition of the
Republic of the Philippines isgranted

LA BUGAL BLAAN TRIBAL ASSOCIATION INC vs RAMOS Case Digest

FACTS: RA 7942 (The Philippine Mining Act) took effect on April 9, 1995. Before the
effectivity of RA 7942, or on March 30, 1995, the President signed a Financial and Technical
Assistance Agreement (FTAA) with WMCP, a corporation organized under Philippine laws,
covering close to 100,000 hectares of land in South Cotabato, Sultan Kudarat, Davao del Sur
and North Cotabato. On August 15, 1995, the Environment Secretary Victor Ramos issued
DENR Administrative Order 95-23, which was later repealed by DENR Administrative Order
96-40, adopted on December 20, 1996.

Petitioners prayed that RA 7942, its implementing rules, and the FTAA between the
government and WMCP be declared unconstitutional on ground that they allow fully foreign
owned corporations like WMCP to exploit, explore and develop Philippine mineral resources
in contravention of Article XII Section 2 paragraphs 2 and 4 of the Charter.

In January 2001, WMC - a publicly listed Australian mining and exploration company - sold
its whole stake in WMCP to Sagittarius Mines, 60% of which is owned by Filipinos while 40%
of which is owned by Indophil Resources, an Australian company. DENR approved the
transfer and registration of the FTAA in Sagittarius name but Lepanto Consolidated assailed
the same. The latter case is still pending before the Court of Appeals.

EO 279, issued by former President Aquino on July 25, 1987, authorizes the DENR to
accept, consider and evaluate proposals from foreign owned corporations or foreign
investors for contracts or agreements involving wither technical or financial assistance for
large scale exploration, development and utilization of minerals which upon appropriate
recommendation of the (DENR) Secretary, the President may execute with the foreign
proponent. WMCP likewise contended that the annulment of the FTAA would violate a treaty
between the Philippines and Australia which provides for the protection of Australian
investments.

ISSUES:
1. Whether or not the Philippine Mining Act is unconstitutional for allowing fully
foreign-owned corporations to exploit the Philippine mineral resources.
2. Whether or not the FTAA between the government and WMCP is a service
contract that permits fully foreign owned companies to exploit the Philippine mineral
resources.
HELD:

First Issue: RA 7942 is Unconstitutional

RA 7942 or the Philippine Mining Act of 1995 is unconstitutional for permitting fully foreign
owned corporations to exploit the Philippine natural resources.

Article XII Section 2 of the 1987 Constitution retained the Regalian Doctrine which states that
All lands of the public domain, waters, minerals, coal, petroleum, and other minerals, coal,
petroleum, and other mineral oils, all forces of potential energy, fisheries, forests or timber,
wildlife, flora and fauna, and other natural resources are owned by the State. The same
section also states that, the exploration and development and utilization of natural
resources shall be under the full control and supervision of the State.

Conspicuously absent in Section 2 is the provision in the 1935 and 1973 Constitution
authorizing the State to grant licenses, concessions, or leases for the exploration,
exploitation, development, or utilization of natural resources. By such omission, the utilization
of inalienable lands of the public domain through license, concession or lease is no longer
allowed under the 1987 Constitution.

Under the concession system, the concessionaire makes a direct equity investment for the
purpose of exploiting a particular natural resource within a given area. The concession
amounts to complete control by the concessionaire over the countrys natural resource, for it
is given exclusive and plenary rights to exploit a particular resource at the point of
extraction.

The 1987 Constitution, moreover, has deleted the phrase management or other forms of
assistance in the 1973 Charter. The present Constitution now allows only technical and
financial assistance. The management and the operation of the mining activities by foreign
contractors, the primary feature of the service contracts was precisely the evil the drafters of
the 1987 Constitution sought to avoid.

The constitutional provision allowing the President to enter into FTAAs is an exception to the
rule that participation in the nations natural resources is reserved exclusively to Filipinos.
Accordingly, such provision must be construed strictly against their enjoyment by non-
Filipinos. Therefore, RA 7942 is invalid insofar as the said act authorizes service contracts.
Although the statute employs the phrase financial and technical agreements in
accordance with the 1987 Constitution, its pertinent provisions actually treat these
agreements as service contracts that grant beneficial ownership to foreign contractors
contrary to the fundamental law.
The underlying assumption in the provisions of the law is that the foreign contractor manages
the mineral resources just like the foreign contractor in a service contract. By allowing foreign
contractors to manage or operate all the aspects of the mining operation, RA 7942 has, in
effect, conveyed beneficial ownership over the nations mineral resources to these
contractors, leaving the State with nothing but bare title thereto.

The same provisions, whether by design or inadvertence, permit a circumvention of the

constitutionally ordained 60-40% capitalization requirement for corporations or associations
engaged in the exploitation, development and utilization of Philippine natural resources.

When parts of a statute are so mutually dependent and connected as conditions,

considerations, inducements or compensations for each other as to warrant a belief that the
legislature intended them as a whole, then if some parts are unconstitutional, all provisions
that are thus dependent, conditional or connected, must fail with them.

Under Article XII Section 2 of the 1987 Charter, foreign owned corporations are limited only
to merely technical or financial assistance to the State for large scale exploration,
development and utilization of minerals, petroleum and other mineral oils.

Second Issue: RP Government-WMCP FTAA is a Service Contract

The FTAA between he WMCP and the Philippine government is likewise unconstitutional
since the agreement itself is a service contract.

Section 1.3 of the FTAA grants WMCP a fully foreign owned corporation, the exclusive right
to explore, exploit, utilize and dispose of all minerals and by-products that may be produced
from the contract area. Section 1.2 of the same agreement provides that EMCP shall
provide all financing, technology, management, and personnel necessary for the Mining
Operations.

These contractual stipulations and related provisions in the FTAA taken together, grant
WMCP beneficial ownership over natural resources that properly belong to the State and are
intended for the benefit of its citizens. These stipulations are abhorrent to the 1987
Constitution. They are precisely the vices that the fundamental law seeks to avoid, the evils
that it aims to suppress. Consequently, the contract from which they spring must be struck
down.

REPUBLIC OF THE PHILIPPINES (DIRECTOR OF FOREST DEVELOPMENT), petitioner,

vs.
HON. COURT OF APPEALS (THIRD DIVISION) and JOSE Y. DE LA ROSA, respondents.

CRUZ, J.:

The Regalian doctrine reserves to the State all natural wealth that may be found in the
bowels of the earth even if the land where the discovery is made be private. 1 In the cases at
bar, which have been consolidated because they pose a common issue, this doctrine was not
correctly applied.

These cases arose from the application for registration of a parcel of land filed on February
11, 1965, by Jose de la Rosa on his own behalf and on behalf of his three children, Victoria,
Benjamin and Eduardo. The land, situated in Tuding, Itogon, Benguet Province, was divided
into 9 lots and covered by plan Psu-225009. According to the application, Lots 1-5 were sold
to Jose de la Rosa and Lots 6-9 to his children by Mamaya Balbalio and Jaime Alberto,
respectively, in 1964. 2

The application was separately opposed by Benguet Consolidated, Inc. as to Lots 1-5, Atok
Big Wedge Corporation, as to Portions of Lots 1-5 and all of Lots 6-9, and by the Republic of
the Philippines, through the Bureau of Forestry Development, as to lots 1-9. 3

In support of the application, both Balbalio and Alberto testified that they had acquired the
subject land by virtue of prescription Balbalio claimed to have received Lots 1-5 from her
father shortly after the Liberation. She testified she was born in the land, which was
possessed by her parents under claim of ownership. 4 Alberto said he received Lots 6-9 in
1961 from his mother, Bella Alberto, who declared that the land was planted by Jaime and his
predecessors-in-interest to bananas, avocado, nangka and camote, and was enclosed with a
barbed-wire fence. She was corroborated by Felix Marcos, 67 years old at the time, who recalled
the earlier possession of the land by Alberto's father. 5 Balbalio presented her tax declaration in
1956 and the realty tax receipts from that year to 1964, 6 Alberto his tax declaration in 1961 and
the realty tax receipts from that year to 1964. 7

Benguet opposed on the ground that the June Bug mineral claim covering Lots 1-5 was sold
to it on September 22, 1934, by the successors-in-interest of James Kelly, who located the
claim in September 1909 and recorded it on October 14, 1909. From the date of its
purchase, Benguet had been in actual, continuous and exclusive possession of the land in
concept of owner, as evidenced by its construction of adits, its affidavits of annual
assessment, its geological mappings, geological samplings and trench side cuts, and its
payment of taxes on the land. 8

For its part, Atok alleged that a portion of Lots 1-5 and all of Lots 6-9 were covered by the
Emma and Fredia mineral claims located by Harrison and Reynolds on December 25, 1930,
and recorded on January 2, 1931, in the office of the mining recorder of Baguio. These
claims were purchased from these locators on November 2, 1931, by Atok, which has since
then been in open, continuous and exclusive possession of the said lots as evidenced by its
annual assessment work on the claims, such as the boring of tunnels, and its payment of
annual taxes thereon. 9

The location of the mineral claims was made in accordance with Section 21 of the Philippine
Bill of 1902 which provided that:

SEC. 21. All valuable mineral deposits in public lands in the philippine Islands
both surveyed and unsurveyed are hereby declared to be free and open to
exploration, occupation and purchase and the land in which they are found to
occupation and purchase by the citizens of the United States, or of said
islands.

The Bureau of Forestry Development also interposed its objection, arguing that the land
sought to be registered was covered by the Central Cordillera Forest Reserve under
Proclamation No. 217 dated February 16, 1929. Moreover, by reason of its nature, it was not
subject to alienation under the Constitutions of 1935 and 1973. 10

The trial court * denied the application, holding that the applicants had failed to prove their claim of possession and
ownership of the land sought to be registered. 11 The applicants appealed to the respondent court, * which
reversed the trial court and recognized the claims of the applicant, but subject to the rights of Benguet and Atok respecting their
mining claims. 12
In other words, the Court of Appeals affirmed the surface rights of the de la Rosas
over the land while at the same time reserving the sub-surface rights of Benguet and Atok by
virtue of their mining claims.

Both Benguet and Atok have appealed to this Court, invoking their superior right of
ownership. The Republic has filed its own petition for review and reiterates its argument that
neither the private respondents nor the two mining companies have any valid claim to the
land because it is not alienable and registerable.

It is true that the subject property was considered forest land and included in the Central
Cordillera Forest Reserve, but this did not impair the rights already vested in Benguet and
Atok at that time. The Court of Appeals correctly declared that:

There is no question that the 9 lots applied for are within the June Bug
mineral claims of Benguet and the "Fredia and Emma" mineral claims of
Atok. The June Bug mineral claim of plaintiff Benguet was one of the 16
mining claims of James E. Kelly, American and mining locator. He filed his
declaration of the location of the June Bug mineral and the same was
recorded in the Mining Recorder's Office on October 14, 1909. All of the Kelly
claims ha subsequently been acquired by Benguet Consolidated, Inc.
Benguet's evidence is that it had made improvements on the June Bug
mineral claim consisting of mine tunnels prior to 1935. It had submitted the
required affidavit of annual assessment. After World War II, Benguet
introduced improvements on mineral claim June Bug, and also conducted
geological mappings, geological sampling and trench side cuts. In 1948,
Benguet redeclared the "June Bug" for taxation and had religiously paid the
taxes.

The Emma and Fredia claims were two of the several claims of Harrison
registered in 1931, and which Atok representatives acquired. Portions of Lots
1 to 5 and all of Lots 6 to 9 are within the Emma and Fredia mineral claims of
Atok Big Wedge Mining Company.

The June Bug mineral claim of Benguet and the Fredia and Emma mineral
claims of Atok having been perfected prior to the approval of the Constitution
of the Philippines of 1935, they were removed from the public domain and
had become private properties of Benguet and Atok.

It is not disputed that the location of the mining claim under

consideration was perfected prior to November 15, 1935,
when the Government of the Commonwealth was
inaugurated; and according to the laws existing at that time,
as construed and applied by this court in McDaniel v.
Apacible and Cuisia (42 Phil. 749), a valid location of a mining
claim segregated the area from the public domain. Said the
court in that case: The moment the locator discovered a
valuable mineral deposit on the lands located, and perfected
his location in accordance with law, the power of the United
States Government to deprive him of the exclusive right to the
possession and enjoyment of the located claim was gone, the
lands had become mineral lands and they were exempted
from lands that could be granted to any other person. The
 reservations of public lands cannot be made so as to include
prior mineral perfected locations; and, of course, if a valid
mining location is made upon public lands afterwards
included in a reservation, such inclusion or reservation does
not affect the validity of the former location. By such location
and perfection, the land located is segregated from the public
domain even as against the Government. (Union Oil Co. v.
Smith, 249 U.S. 337; Van Mess v. Roonet, 160 Cal. 131; 27
Cyc. 546).

"The legal effect of a valid location of a mining claim is not

only to segregate the area from the public domain, but to
grant to the locator the beneficial ownership of the claim and
the right to a patent therefor upon compliance with the terms
and conditions prescribed by law. Where there is a valid
location of a mining claim, the area becomes segregated from
the public domain and the property of the locator." (St. Louis
Mining & Milling Co. v. Montana Mining Co., 171 U.S. 650;
655; 43 Law ed., 320, 322.) "When a location of a mining
claim is perfected it has the effect of a grant by the United
States of the right of present and exclusive possession, with
the right to the exclusive enjoyment of all the surface ground
as well as of all the minerals within the lines of the claim,
except as limited by the extralateral right of adjoining locators;
and this is the locator's right before as well as after the
issuance of the patent. While a lode locator acquires a vested
property right by virtue of his location made in compliance
with the mining laws, the fee remains in the government until
patent issues."(18 R.C.L. 1152) (Gold Creek Mining
Corporation v. Hon. Eulogio Rodriguez, Sec. of Agriculture
and Commerce, and Quirico Abadilla, Director of the Bureau
of Mines, 66 Phil. 259, 265-266)

It is of no importance whether Benguet and Atok had secured a patent for as

held in the Gold Creek Mining Corp. Case, for all physical purposes of
ownership, the owner is not required to secure a patent as long as he
complies with the provisions of the mining laws; his possessory right, for all
practical purposes of ownership, is as good as though secured by patent.

We agree likewise with the oppositors that having complied with all the
requirements of the mining laws, the claims were removed from the public
domain, and not even the government of the Philippines can take away this
right from them. The reason is obvious. Having become the private properties
of the oppositors, they cannot be deprived thereof without due process of
law. 13

Such rights were not affected either by the stricture in the Commonwealth Constitution
against the alienation of all lands of the public domain except those agricultural in nature for
this was made subject to existing rights. Thus, in its Article XIII, Section 1, it was
categorically provided that:
 SEC. 1. All agricultural, timber and mineral lands of the public domain,
waters, minerals, coal, petroleum and other mineral oils, all forces of potential
energy and other natural resources of the Philipppines belong to the State,
and their disposition, exploitation, development, or utilization shall be limited
to citizens of the Philippines or to corporations or associations at least 60% of
the capital of which is owned by such citizens, subject to any existing right,
grant, lease or concession at the time of the inauguration of the government
established under this Constitution. Natural resources with the exception of
public agricultural lands, shall not be alienated, and no license, concession,
or lease for the exploitation, development or utilization of any of the natural
resources shall be granted for a period exceeding 25 years, except as to
water rights for irrigation, water supply, fisheries, or industrial uses other than
the development of water power, in which case beneficial use may be the
measure and the limit of the grant.

Implementing this provision, Act No. 4268, approved on November 8, 1935, declared:

Any provision of existing laws, executive order, proclamation to the contrary

notwithstanding, all locations of mining claim made prior to February 8, 1935
within lands set apart as forest reserve under Sec. 1826 of the Revised
Administrative Code which would be valid and subsisting location except to
the existence of said reserve are hereby declared to be valid and subsisting
locations as of the date of their respective locations.

The perfection of the mining claim converted the property to mineral land and under the laws
then in force removed it from the public domain. 14 By such act, the locators acquired exclusive
rights over the land, against even the government, without need of any further act such as the
purchase of the land or the obtention of a patent over it. 15 As the land had become the private
property of the locators, they had the right to transfer the same, as they did, to Benguet and Atok.

It is true, as the Court of Appeals observed, that such private property was subject to the
"vicissitudes of ownership," or even to forfeiture by non-user or abandonment or, as the
private respondents aver, by acquisitive prescription. However, the method invoked by the
de la Rosas is not available in the case at bar, for two reasons.

First, the trial court found that the evidence of open, continuous, adverse and exclusive
possession submitted by the applicants was insufficient to support their claim of ownership.
They themselves had acquired the land only in 1964 and applied for its registration in 1965,
relying on the earlier alleged possession of their predecessors-in-interest. 16The trial judge,
who had the opportunity to consider the evidence first-hand and observe the demeanor of the
witnesses and test their credibility was not convinced. We defer to his judgment in the absence of
a showing that it was reached with grave abuse of discretion or without sufficient basis. 17

Second, even if it be assumed that the predecessors-in-interest of the de la Rosas had really
been in possession of the subject property, their possession was not in the concept of owner
of the mining claim but of the property as agricultural land, which it was not. The property
was mineral land, and they were claiming it as agricultural land. They were not disputing the
lights of the mining locators nor were they seeking to oust them as such and to replace them
in the mining of the land. In fact, Balbalio testified that she was aware of the diggings being
undertaken "down below" 18 but she did not mind, much less protest, the same although she
claimed to be the owner of the said land.
The Court of Appeals justified this by saying there is "no conflict of interest" between the
owners of the surface rights and the owners of the sub-surface rights. This is rather doctrine,
for it is a well-known principle that the owner of piece of land has rights not only to its surface
but also to everything underneath and the airspace above it up to a reasonable
height. 19 Under the aforesaid ruling, the land is classified as mineral underneath and agricultural
on the surface, subject to separate claims of title. This is also difficult to understand, especially in
its practical application.

Under the theory of the respondent court, the surface owner will be planting on the land while
the mining locator will be boring tunnels underneath. The farmer cannot dig a well because
he may interfere with the operations below and the miner cannot blast a tunnel lest he
destroy the crops above. How deep can the farmer, and how high can the miner, go without
encroaching on each other's rights? Where is the dividing line between the surface and the
sub-surface rights?

The Court feels that the rights over the land are indivisible and that the land itself cannot be
half agricultural and half mineral. The classification must be categorical; the land must be
either completely mineral or completely agricultural. In the instant case, as already observed,
the land which was originally classified as forest land ceased to be so and became mineral
and completely mineral once the mining claims were perfected. 20 As long as mining
operations were being undertaken thereon, or underneath, it did not cease to be so and become
agricultural, even if only partly so, because it was enclosed with a fence and was cultivated by
those who were unlawfully occupying the surface.

What must have misled the respondent court is Commonwealth Act No. 137, providing as
follows:

Sec. 3. All mineral lands of the public domain and minerals belong to the
State, and their disposition, exploitation, development or utilization, shall be
limited to citizens of the Philippines, or to corporations, or associations, at
least 60% of the capital of which is owned by such citizens, subject to any
existing right, grant, lease or concession at the time of the inauguration of
government established under the Constitution.

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

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

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

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

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

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

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

SO ORDERED.

Land Titles And Deeds Case Digest: Lee

Hong Kok V. David (1972)
Lessons Applicable: (Land Titles and Deeds)

Sec. 2 Art. XII 1987 Constitution

Imperium v. Dominium

legality of the grant is a question between the grantee and the government

FACTS:

Aniano David acquired lawful title pursuant to his miscellaneous sales application in accordance
with which an order of award and for issuance of a sales patent (*similar to public auction) was
made by the Director of Lands on June 18, 1958, covering Lot 2892.

On the basis of the order of award of the Director of Lands the Undersecretary of Agriculture and
Natural Resources issued on August 26, 1959, Miscellaneous Sales Patent No. V-1209 pursuant
to which OCT No. 510 was issued by the Register of Deeds of Naga City on October 21, 1959.
 Land in question is not a private property as the Director of Lands and the Secretary of
Agriculture and Natural Resources have always sustained the public character for having been
formed by reclamation (as opposed to peittioners contention that it is accretion)

The only remedy: action for reconveyance on the ground of fraud - But there was no fraud in this
case

ISSUES:

1. W/N Lee Hong Kok can question the grant. - NO

2. W/N David has original acquisition of title. - YES

HELD: Court of Appeals Affirmed. (no legal justification for nullifying the right of David to the
disputed lot arising from the grant made in his favor by respondent officials)
Only the Government, represented by the Director of Lands, or the Secretary of Agriculture and
Natural Resources, can bring an action to cancel a void certificate of title issued pursuant to a
void patent. The legality of the grant is a question between the grantee and the
government. Private parties like the plaintiffs cannot claim that the patent and title issued for the
land involved are void since they are not the registered owners thereof nor had they been declared
as owners in the cadastral proceedings of Naga Cadastre after claiming it as their private
property.

Well-settled Rule : no public land can be acquired by private persons without any grant, express
or implied, from the government

Cabacug v. Lao: holder of a land acquired under a free patent is more favorably situated than that
of an owner of registered property. Not only does a free patent have a force and effect of a
Torrens Title, but in addition the person to whom it is granted has likewise in his favor the right to
repurchase within a period of 5 years.

Imperium v. Dominium

1. Imperium - government authority possessed by the state which is appropriately embraced in the
concept of sovereignty

2. Dominium - capacity to own or acquire property. The use of this term is appropriate with
reference to lands held by the state in its proprietary character. In such capacity, it may provide
for the exploitation and use of lands and other natural resources, including their disposition,
except as limited by the Constitution.