No.

26
ASAPHIL V. TUASON

FACTS: Vicente Tuason, Jr entered into a Contract for Sale and Purchase of Perlite Ore with Induplex
wherein Induplex agreed to buy all the Perlite Ore that can be found and mined in Tuason's mining claim
and in return, Induplex will assist Tuason to secure his rights over the mining claim.
Then, Tuason executed an Agreement to Operate Mining Claims in favor of Asaphil. Tuason
thereafter filed with the Bureau of Mines-DENR against Induplex and Asaphil for the nullity of the two
contracts alleging that the stockholders of Induplex created Ibalon Mineral Resources Inc. and then
extracted in Ibalon's mining claim and thereafter entered into a joint Venture with Grefco, Inc. which
would violate their agreement.

ISSUE: Whether or not DENR can take cognizance of the case.

HELD: Tuason's case based on its facts is not a mining dispute. the second contract although a mining
contract does not make a mining dispute, the resolution of its nullity is not based on Asaphil's violation
of the conditions but due to Induplex's alleged violation in entering into a joint venture with Grefco Ltd.
which is a judicial question. The nullity shall be determined by regular courts. "A judicial question is
raised when the determination of the question involves the exercise of judicial function, which involves
the determination of what the law is all about and what are the legal rights of the parties" As provided
in Section 7 of P.D. 1281 "Section 7. In addition to its regulatory and adjudicative functions over
companies, partnerships or persons engaged in mining exploration, development and exploitation,
development and exploitation, the Bureau of Mines shall have original and exclusive jurisdiction to hear
and decide cases involving:
(a) a mining property subject of different agreements entered into by the claim holder thereof with
several mining operators;
(b) complaints from claimowners that the mining property subject of an operating agreement has not
been placed into actual operations within the period stipulated therein; and
(c) cancellation and/or enforcement of mining contracts due to the refusal of the claimowner/operator
to abide by the terms and conditions thereof."
No. 27
DIPIDIO EARTH-SAVER’S MULTI-PURPOSE ASSOCIATION V. GAZUN

FACTS: Then President Cory Aquino rolled out EO 279 which empowered DENR to stipulate with foreign
companies when it comes to either technical or financial large scale exploration or mining. In 1995,
Ramos signed into law RA 7942 or the Philippine Mining Act. In 1994, Ramos already signed an FTAA
with Arimco Mining Co, an Australian company. The FTAA authorized AMC (later CAMC) to explore
37,000 ha of land in Quirino and N. Vizcaya including Brgy Didipio. After the passage of the law, DENR
rolled out its implementing RRs. Didipio petitioned to have the law and the RR to be annulled as it is
unconstitutional and it constitutes unlawful taking of property. In seeking to nullify Rep. Act No. 7942
and its implementing rules DAO 96-40 as unconstitutional, petitioners set their sight on Section 76 of
Rep. Act No. 7942 and Section 107 of DAO 96-40 which they claim allow the unlawful and unjust
“taking” of private property for private purpose in contradiction with Section 9, Article III of the 1987
Constitution mandating that private property shall not be taken except for public use and the
corresponding payment of just compensation. They assert that public respondent DENR, through the
Mining Act and its Implementing Rules and Regulations, cannot, on its own, permit entry into a private
property and allow taking of land without payment of just compensation.

Traversing petitioners’ assertion, public respondents argue that Section 76 is not a taking provision but a
valid exercise of the police power and by virtue of which, the state may prescribe regulations to
promote the health, morals, peace, education, good order, safety and general welfare of the people.
This government regulation involves the adjustment of rights for the public good and that this
adjustment curtails some potential for the use or economic exploitation of private property. Public
respondents concluded that “to require compensation in all such circumstances would compel the
government to regulate by purchase.”

ISSUE: Whether or not Section 76 of Rep. Act No. 7942 and DAO 96-40 are valid.

HELD: The Supreme Court ruled that in the case at bar, Didipio failed to show that the law is invalid.
Indeed there is taking involved but it is not without just compensation. Sec 76 of RA 7942 provides for
just compensation as well as section 107 of the DENR Rules and Regulations. To wit,

Section 76. xxx Provided, that any damage to the property of the surface owner, occupant, or
concessionaire as a consequence of such operations shall be properly compensated as may be provided
for in the implementing rules and regulations.

Section 107. Compensation of the Surface Owner and Occupant- Any damage done to the property of
the surface owners, occupant, or concessionaire thereof as a consequence of the mining operations or
as a result of the construction or installation of the infrastructure mentioned in 104 above shall be
properly and justly compensated.

Further, mining is a public policy and the government can invoke eminent domain to exercise entry,
acquisition and use of private lands.
No. 28
REPUBLIC V ROSEMOOR

FACTS: The petitioners, after having been granted permission to prospect for marble deposits in the
mountains of Biak-na-Bato, San Miguel, Bulacan, succeeded in discovering marble deposits of high
quality and in commercial quantities in Mount Mabio which forms part of the Biak-na-Bato mountain
range. After compliance with numerous required conditions, License No. 33 was issued by the Bureau of
Mines in favor of the herein petitioners."Shortly after Respondent Ernesto R. Maceda was appointed
Minister of the Department of Energy and Natural Resources (DENR), petitioners’ License No. 33 was
cancelled by him through his letter to Rosemoor Mining and Development Corporation.
The trial court ruled that the privilege granted under respondents’ license had already ripened
into a property right, which was protected under the due process clause of the Constitution. Such right
was supposedly violated when the license was cancelled without notice and hearing. The cancellation
was said to be unjustified, because the area that could be covered by the four separate applications of
respondents was 400 hectares. Finally, according to the RTC, Proclamation No. 84, which confirmed the
cancellation of the license, was an ex post facto law; as such, it violated Section 3 of Article XVIII of the
1987 Constitution. The CA held that the grant of the quarry license covering 330.3062 hectares to
respondents was authorized by law, because the license was embraced by four separate applications
each for an area of 81 hectares. Moreover, it held that the limitation under Presidential Decree No. 463
that a quarry license should cover not more than 100 hectares in any given province -- was supplanted
by Republic Act No. 7942 which increased the mining areas allowed under PD 463.

ISSUE: Whether or not QLP No. 33 contravenes Section 69, P.D. No. 463.

HELD: It is relevant to state, however, that Section 2 of Article XII of the 1987 Constitution does not
apply retroactively to a "license, concession or lease" granted by the government under the 1973
Constitution or before the effectivity of the 1987 Constitution on February 2, 1987.17 As noted in
Miners Association of the Philippines v. Factoran Jr., the deliberations of the Constitutional
Commission18 emphasized the intent to apply the said constitutional provision prospectively.
"SECTION 112. Non-impairment of Existing Mining/ Quarrying Rights. — All valid and existing mining
lease contracts, permits/licenses, leases pending renewal, mineral production-sharing agreements
granted under Executive Order No. 279, at the date of effectivity of this Act, shall remain valid, shall not
be impaired, and shall be recognized by the Government: Provided, That the provisions of Chapter XIV
on government share in mineral production-sharing agreement and of Chapter XVI on incentives of this
Act shall immediately govern and apply to a mining lessee or contractor unless the mining lessee or
contractor indicates his intention to the secretary, in writing, not to avail of said provisions: Provided,
further, That no renewal of mining lease contracts shall be made after the expiration of its term:
Provided, finally, That such leases, production-sharing agreements, financial or technical assistance
agreements shall comply with the applicable provisions of this Act and its implementing rules and
regulations.
"SECTION 113. Recognition of Valid and Existing Mining Claims and Lease/Quarry Application. — Holders
of valid and existing mining claims, lease/quarry applications shall be given preferential rights to enter
into any mode of mineral agreement with the government within two (2) years from the promulgation
of the rules and regulations implementing this Act." (Underscoring supplied)
Section 3(p) of RA 7942 defines an existing mining/quarrying right as "a valid and subsisting mining claim
or permit or quarry permit or any mining lease contract or agreement covering a mineralized area
granted/issued under pertinent mining laws." Consequently, determining whether the license of
respondents falls under this definition would be relevant to fixing their entitlement to the rights and/or
preferences under RA 7942. Hence, the present Petition has not been mooted.
Petitioners submit that the license clearly contravenes Section 69 of PD 463, because it exceeds the
maximum area that may be granted. This incipient violation, according to them, renders the license void
ab initio.
Respondents, on the other hand, argue that the license was validly granted, because it was covered by
four separate applications for areas of 81 hectares each.
The license in question, QLP No. 33,19 is dated August 3, 1982, and it was issued in the name of
Rosemoor Mining Development Corporation. The terms of the license allowed the corporation to extract
and dispose of marbleized limestone from a 330.3062-hectare land in San Miguel, Bulacan. The license
is, however, subject to the terms and conditions of PD 463, the governing law at the time it was granted;
as well as to the rules and regulations promulgated thereunder.20 By the same token, Proclamation No.
2204 -- which awarded to Rosemoor the right of development, exploitation, and utilization of the
mineral site -- expressly cautioned that the grant was subject to "existing policies, laws, rules and
regulations."21
The license was thus subject to Section 69 of PD 463, which reads:
"Section 69. Maximum Area of Quarry License – Notwithstanding the provisions of Section 14 hereof, a
quarry license shall cover an area of not more than one hundred (100) hectares in any one province and
not more than one thousand (1,000) hectares in the entire Philippines." (Italics supplied)
The language of PD 463 is clear. It states in categorical and mandatory terms that a quarry license, like
that of respondents, should cover a maximum of 100 hectares in any given province. This law neither
provides any exception nor makes any reference to the number of applications for a license. Section 69
of PD 463 must be taken to mean exactly what it says. Where the law is clear, plain, and free from
ambiguity, it must be given its literal meaning and applied without attempted interpretation.22
Moreover, the lower courts’ ruling is evidently inconsistent with the fact that QLP No. 33 was issued
solely in the name of Rosemoor Mining and Development Corporation, rather than in the names of the
four individual stockholders who are respondents herein. It likewise brushes aside a basic postulate that
a corporation has a separate personality from that of its stockholders.23
The interpretation adopted by the lower courts is contrary to the purpose of Section 69 of PD 463. Such
intent to limit, without qualification, the area of a quarry license strictly to 100 hectares in any one
province is shown by the opening proviso that reads: "Notwithstanding the provisions of Section 14
hereof x x x." The mandatory nature of the provision is also underscored by the use of the word shall.
Hence, in the application of the 100-hectare-per-province limit, no regard is given to the size or the
number of mining claims under Section 14, which we quote:
"SECTION 14. Size of Mining Claim. -- For purposes of registration of a mining claim under this Decree,
the Philippine territory and its shelf are hereby divided into meridional blocks or quadrangles of one-half
minute (1/2) of latitude and longitude, each block or quadrangle containing area of eighty-one (81)
hectares, more or less.
"A mining claim shall cover one such block although a lesser area may be allowed if warranted by
attendant circumstances, such as geographical and other justifiable considerations as may be
determined by the Director: Provided, That in no case shall the locator be allowed to register twice the
area allowed for lease under Section 43 hereof." (Italics supplied)
Clearly, the intent of the law would be brazenly circumvented by ruling that a license may cover an area
exceeding the maximum by the mere expediency of filing several applications. Such ruling would
indirectly permit an act that is directly prohibited by the law.
No. 29
LA BUGAL-B’LAAN V. RAMOS
JANUARY 27, 2004

FACTS: This petition challenges the constitutionality of Republic Act No. 7942 (The Philippine Mining Act
of 1995), its implementing rules and regulations and the Financial and Technical Assistance Agreement
(FTAA) dated March 30, 1995 by the government with Western Mining Corporation (Philippines) Inc.
(WMCP).Accordingly, the FTAA violated the 1987 Constitution in that it is a service contract and is
antithetical to the principle of sovereignty over our natural resources, because they allowed foreign
control over the exploitation of our natural resources, to the prejudice of the Filipino nation.

ISSUE: Whether or not the Philippine Mining Act is unconstitutional

HELD: The Court ruled that RA 7942 or the Philippine Mining Act of 1995 is unconstitutional for
permitting fully foreign owned corporations to exploit the Phil natural resources.
Article XII Sec 2 of the 1987 Constitution retained the Regalian Doctrine w/c states that – All
lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of
potential energy, fisheries, forest 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.
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 nation’s 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 statutes 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.
No. 30
LA BUGAL-B’LAAN V. RAMOS
DECEMBER 1, 2004

FACTS: The Court challenges the constitutionality of Republic Act 7942 (The Philippine Mining Act of
1995); its Implementing Rules and Regulations DENR Administrative Order 96-40; and the Financial and
Technical Assistance Agreement (FTAA) dated 30 March 1995, executed by the government with
Western Mining Corporation (Philippines), Inc. (WMCP).

On 27 January 2004, the Court en banc promulgated its Decision, granting the Petition and declaring the
unconstitutionality of certain provisions of RA 7942, DAO 96-40, as well as of the entire FTAA executed
between the government and WMCP, mainly on the finding that FTAAs are service contracts prohibited
by the 1987 Constitution. The Decision struck down the subject FTAA for being similar to service
contracts,[9] which, though permitted under the 1973 Constitution, were subsequently denounced for
being antithetical to the principle of sovereignty over our natural resources, because they allowed
foreign control over the exploitation of our natural resources, to the prejudice of the Filipino nation.

The Decision quoted several legal scholars and authors who had criticized service contracts for, inter
alia, vesting in the foreign contractor exclusive management and control of the enterprise, including
operation of the field in the event petroleum was discovered; control of production, expansion and
development; nearly unfettered control over the disposition and sale of the products
discovered/extracted; effective ownership of the natural resource at the point of extraction; and
beneficial ownership of our economic resources. According to the Decision, the 1987 Constitution
(Section 2 of Article XII) effectively banned such service contracts. Subsequently, Victor O. Ramos
(Secretary, Department of Environment and Natural Resources [DENR]), Horacio Ramos (Director, Mines
and Geosciences Bureau [MGB-DENR]), Ruben Torres (Executive Secretary), and the WMC (Philippines)
Inc. filed separate Motions for Reconsideration.

ISSUE: Whether or not the Court has a role in the exercise of the power of control over the exploration,
Development and utilization of our natural resources?

HELD: The Court ruled that it is the Chief Executive is the official that is constitutionally mandated to
“enter into agreements with foreign owned corporations.” On the other hand, Congress may review the
action of the President once it is notified of “every contract entered into in accordance with this
[constitutional] provision within thirty days from its execution.” In contrast to this express mandate of
the President and Congress in the exploration, development and utilization (EDU) of natural resources,
Article XII of the Constitution is silent on the role of the judiciary. However, should the President and/or
Congress gravely abuse their discretion in this regard, the courts may -- in a proper case -- exercise their
residual duty under Article VIII. Clearly then, the judiciary should not inordinately interfere in the
exercise of this presidential power of control over the EDU of our natural resources.

Under the doctrine of separation of powers and due respect for co-equal and coordinate branches of
government, the Court must restrain itself from intruding into policy matters and must allow the
President and Congress maximum discretion in using the resources of our country and in securing the
assistance of foreign groups to eradicate the grinding poverty of our people and answer their cry for
viable employment opportunities in the country. “The judiciary is loath to interfere with the due
exercise by coequal branches of government of their official functions.” As aptly spelled out seven
decades ago by Justice George Malcolm, “Just as the Supreme Court, as the guardian of constitutional
rights, should not sanction usurpations by any other department of government, so should it as strictly
confine its own sphere of influence to the powers expressly or by implication conferred on it by the
Organic Act.” Let the development of the mining industry be the responsibility of the political branches
of government. And let not the Court interfere inordinately and unnecessarily. The Constitution of the
Philippines is the supreme law of the land. It is the repository of all the aspirations and hopes of all the
people.

The Constitution should be read in broad, life-giving strokes. It should not be used to strangulate
economic growth or to serve narrow, parochial interests. Rather, it should be construed to grant the
President and Congress sufficient discretion and reasonable leeway to enable them to attract foreign
investments and expertise, as well as to secure for our people and our posterity the blessings of
prosperity and peace. The Court fully sympathizes with the plight of La Bugal B’laan and other tribal
groups, and commends their efforts to uplift their communities. However, the Court cannot justify the
invalidation of an otherwise constitutional statute along with its implementing rules, or the nullification
of an otherwise legal and binding FTAA contract. The Court believes that it is not unconstitutional to
allow a wide degree of discretion to the Chief Executive, given the nature and complexity of such
agreements, the humongous amounts of capital and financing required for large-scale mining
operations, the complicated technology needed, and the intricacies of international trade, coupled with
the State’s need to maintain flexibility in its dealings, in order to preserve and enhance our country’s
competitiveness in world markets. On the basis of this control standard, the Court upholds the
constitutionality of the Philippine Mining Law, its Implementing Rules and Regulations - insofar as they
relate to financial and technical agreements - as well as the subject Financial and Technical Assistance
Agreement (FTAA).