ENVIRONMENT AND THE PHILIPPINE CONSTITUTION

Constitutional Provisions: Right to health and environment

Sec. 15 and 16, Article II, Const.

Section 15. The State shall protect and promote the right to health of the people and instill health consciousness among them.

Section 16. The State shall protect and advance the right of the people to a balanced and healthful ecology in accord with the rhythm and harmony of nature. Oposa vs. Factoran, G.R. No. 101083 July 30, 1993, 224 SCRA 789FACTS:

The principal petitioners are all minors duly represented and joined by their respective parents. Impleaded as an additionalplaintiffis the Philippine Ecological Network, Inc. (PENI), adomestic, non-stock andnon-profitcorporation organized for the purpose of,inter alia, engaging in concerted action geared for the protection of our environment and natural resources. The original defendant was the Honorable Fulgencio S. Factoran, Jr., then Secretary of theDepartment of Environmentand Natural Resources (DENR).

The complaint was instituted as ataxpayers' class suit and alleges that theplaintiffs"are all citizens of the Republic of the Philippines,taxpayers, and entitled to the full benefit, use and enjoyment of thenatural resourcetreasure that is the country's virgin tropical forests." This instant petition was filed to seek for the cancelation of all existing timber license agreements (TLAs) in the country and to cease and desist from receiving, accepting, processing, renewing or approving new timber license agreements.

Minor petitioners contend that continued granting of timber license constitutes a misappropriation or impairment of thenatural resourceproperty and violates their constitutional right to a balanced and healthful ecology (Art. II, Sec. 16, 1987Constitution) and the protection by the State in its capacity as parens patriae. Petitioners likewise rely on the respondent's correlative obligation per Section 4 of E.O. No. 192, tosafeguardthe people's right to a healthful environment.

ISSUES:

1. Whether or not the petitioners have locus standi.

2. Whether or not the petitioners failed to allege in their complaint a specific legal right violated by the respondent Secretary for which any relief is provided by law.

HELD:

1. The Court finds no difficulty in ruling that they can file a class suit because they represent their generation as well as generations yet unborn. Their personality to sue in behalf of the succeeding generations can only be based on the concept of intergenerational responsibility insofar as the right to a balanced and healthful ecology is concerned. Such a right, as hereinafter expounded, considersthe "rhythm and harmony of nature." Nature means the created world in its entirety. Such rhythm and harmony indispensably include,inter alia, the judicious disposition, utilization, management,renewaland conservation of the country's forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other natural resources to the end that their exploration, development and utilization be equitably accessible to the present as well as future generations. 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.

2. The Court does not agree with the trial court's conclusions that theplaintiffsfailed to allege with sufficient definiteness a specific legal right involved or a specific legal wrong committed, and that the complaint is replete with vague assumptions and conclusions based on unverified data.

The complaint focuses on one specific fundamental legal right the right to a balanced and healthful ecology which, for the first time in our nation's constitutional history, is solemnly incorporated in thefundamental law(Section 16, Article II of the 1987Constitution).

While the right to a balanced and healthful ecology is to be found under the Declaration ofPrinciplesand State Policies and not under the Bill of Rights, it does not follow that it is less important than any of the civil and political rights enumerated in the latter. Such a right belongs to a different category of rights altogether for it concerns nothing less than self-preservation and self-perpetuation aptly and fittingly stressed by the petitioners the advancement of which may even be said to predate all governments and constitutions.

The right to a balanced and healthful ecology carries with it the correlative duty to refrain from impairing the environment. EO 192 and Admin Code of 1987 define the powers and functions of DENR, under whose authority and office the complaint falls. The petitioners right to a balanced and healthful ecology is as clear as DENRs duty to protect and advance the said right. The petitioners personality to sue in behalf of their own as well as the future generations behalf can only be based on the concept of intergenerational responsibility insofar as the said right is concerned.

Ysmael v Deputy Executive Secretary [G.R. No. 79538 October 18, 1990]FACTS:

On October 12, 1965, petitioner entered into a timber license agreement with the Department of Agriculture and Natural Resources, represented by then Secretary Jose Feliciano, wherein it was issued an exclusive license to cut, collect and remove timber except prohibited species within a specified portion of public forest land with an area of 54,920 hectares located in the municipality of Maddela, province of Nueva Vizcaya from October 12, 1965until June 30, 1990. However, on August 18, 1983, the Director of the Bureau of Forest Development (Bureau), Director Edmundo Cortes, issued a memorandum order stopping all logging operations in Nueva Vizcaya and Quirino provinces, and cancelling the logging concession of petitioner and nine other forest concessionaires, pursuant to presidential instructions and a memorandum order of the Minister of Natural Resources Teodoro Pena. Subsequently, petitioners timber license agreement was cancelled. He sent a letter addressed to then President Ferdinand Marcos which sought reconsideration of the Bureau's directive, citing in support thereof its contributions to forest conservation and alleging that it was not given the opportunity to be heard prior to the cancellation of its logging operations, but no favorable action was taken on his letter; Barely one year thereafter, approximately one-half of the area formerly covered by petitioners TLA was re-awarded to Twin Peaks Development and Realty Corporation under a new TLA which was set to expire on July 31,2009, while the other half was allowed to be logged by Filipinas Loggers, Inc. without the benefit of a formal award or license. The latter entities were controlled or owned by relatives or cronies of deposed President Ferdinand Marcos. Soon after the change of government in February 1986, petitioner sent a letter dated March 17, 1986 to the Office of the President, and another letter dated April 2, 1986 to Minister Ernesto Maceda of the Ministry of Natural Resources [MNR], seeking: (1) the reinstatement of its timber license agreement which was cancelled in August 1983 during the Marcos administration; (2) the revocation of TLA No. 356 which was issued to Twin Peaks Development and Realty Corporation without public bidding and in violation of forestry laws, rules and regulations; and, (3) the issuance of an order allowing petitioner to take possession of all logs found in the concession area. However, petitioner's request was denied. Petitioner moved for reconsideration reiterating, among others, its request that the timber license agreement issued to private respondent be declared null and void. The MNR however denied this motion. Petitioner subsequently appealed from the orders of the MNR to the Office of the President. The Office of the President, acting through then Deputy Executive Secretary Catalino Macaraig, denied petitioner's appeal for lack of merit. Petitioner filed with the Court a petition for certiorari, with prayer for the issuance of a restraining order or writ of preliminary injunction.

ISSUE:

Whether or not petitioner has the right to seek the nullification of the Bureau orders cancelling his timber license agreement and the granting of TLA to private respondent, which were issued way back in 1983 and1984, respectively.

HELD:

NO. The failure of petitioner to file the petition for certiorari within a reasonable period of time renders the petitioner susceptible to the adverse legal consequences of laches. Laches is defined as the failure or neglect for an unreasonable and unexplained length of time to do that which by exercising due diligence, could or should have been done earlier, or to assert a right within a reasonable time, warranting a presumption that the party entitled thereto has either abandoned it of declined to assert it. The rule is that unreasonable delay on the part of a plaintiff in seeking to enforce an alleged right may, depending upon the circumstances, be destructive of the right itself. Verily, the laws did these who are vigilant, not those who sleep upon their rights. In the case at bar, petitioner waited for at least three years before it finally filed a petition for certiorari with the Court attacking the validity of the assailed Bureau actions in 1983 and 1984. Considering that petitioner, throughout the period of its inaction, was not deprived of the opportunity to seek relief from the courts which were normally operating at the time, its delay constitutes unreasonable and inexcusable neglect, tantamount to laches. Accordingly, the writ of certiorari requiring the reversal of these orders will not lie. There is a more significant factor which bars the issuance of a writ of certiorari in favor of petitioner and against public respondents herein. A long line of cases establish the basic rule that the courts will not interfere in matters which are addressed to the sound discretion of government agencies entrusted with the regulation of activities coming under the special technical knowledge and training of such agencies. More so where, as in the present case, the interests of a private logging company are pitted against that of the public at large on the pressing public policy issue of forest conservation. For this Court recognizes the wide latitude of discretion possessed by the government in determining the appropriate actions to be taken to preserve and manage natural resources, and the proper parties who should enjoy the privilege of utilizing these resources. Timber licenses, permits and license agreements are the principal instruments by which the State regulates the utilization and disposition of forest resources to the end that public welfare is promoted. And it can hardly be gainsaid that they merely evidence a privilege granted by the State to qualified entities, and do not vest in the latter a permanent or irrevocable right to the particular concession area and the forest products therein. They may be validly amended, modified, replaced or rescinded by the Chief Executive when national interests so require. Thus, they are not deemed contracts within the purview of the due process of law clause.

Henares vs. LTFRB, G.R. No. 158290, Oct 23, 2006

FACTS:

Petitioners challenge this Court to issue a writ of mandamus commanding respondents Land Transportation Franchising and Regulatory Board (LTFRB) and the Department of Transportation and Communications (DOTC) to require public utility vehicles (PUVs) to use compressed natural gas (CNG) as alternative fuel.

ISSUES:

(1) Do petitioners have legal personality to bring this petition before us?

(2) Should mandamus issue against respondents to compel PUVs to use CNG as alternative fuel?

APPLICABLE LAWS:

Section 16,12 Article II of the 1987 Constitution

The State shall protect and advance the right of the people to a balanced and healthful ecology in accord with the rhythm and harmony of nature.

Section 414 of Republic Act No. 8749 otherwise known as the "Philippine Clean Air Act of 1999." SEC. 4. Recognition of Rights. Pursuant to the above-declared principles, the following rights of citizens are hereby sought to be recognized and the State shall seek to guarantee their enjoyment:

a) The right to breathe clean air;

b) The right to utilize and enjoy all natural resources according to the principle of sustainable development;

c) The right to participate in the formulation, planning, implementation and monitoring of environmental policies and programs and in the decision-making process;

d) The right to participate in the decision-making process concerning development policies, plans and programs, projects or activities that may have adverse impact on the environment and public health;

e) The right to be informed of the nature and extent of the potential hazard of any activity, undertaking or project and to be served timely notice of any significant rise in the level of pollution and the accidental or deliberate release into the atmosphere of harmful or hazardous substances;

f) The right of access to public records which a citizen may need to exercise his or her rights effectively under this Act;

g) The right to bring action in court or quasi-judicial bodies to enjoin all activities in violation of environmental laws and regulations, to compel the rehabilitation and cleanup of affected area, and to seek the imposition of penal sanctions against violators of environmental laws; and

h) The right to bring action in court for compensation of personal damages resulting from the adverse environmental and public health impact of a project or activity.

RULING:

(1) YES. There is no dispute that petitioners have standing to bring their case before this Court. Moreover, as held previously, a party's standing before this Court is a procedural technicality which may, in the exercise of the Court's discretion, be set aside in view of the importance of the issue raised. We brush aside this issue of technicality under the principle of the transcendental importance to the public, especially so if these cases demand that they be settled promptly.

(2) NO. plain, speedy and adequate remedy herein sought by petitioners, i.e., a writ of mandamus commanding the respondents to require PUVs to use CNG, is unavailing. Mandamus is available only to compel the doing of an act specifically enjoined by law as a duty. Here, there is no law that mandates the respondents LTFRB and the DOTC to order owners of motor vehicles to use CNG. Mandamus will not generally lie from one branch of government to a coordinate branch, for the obvious reason that neither is inferior to the other.

It appears that more properly, the legislature should provide first the specific statutory remedy to the complex environmental problems bared by herein petitioners before any judicial recourse by mandamus is taken. SJS v Atienza G.R. No. 156052, Feb. 13, 2008

Facts:

On November 20, 2001, the Sangguniang Panlungsod of Manila enacted Ordinance No. 8027 and Atienza passed it the following day. Ordinance No. 8027 reclassified the area described therein from industrial to commercial and directed the owners and operators of businesses disallowed under Section 1 tocease and desistfrom operating their businesses within six months from thedate ofeffectivity of the ordinance. These were the Pandacan oil depots of Shell and Caltex.

But the city of Manila and the DOE entered into an MOU which only scaled down the property covered by the depots and did not stop theiroperations. In the same resolution, the Sanggunian declared that the MOU was effective only for a period of six months starting July 25, 2002. It was extended to 2003.

Petitioners filed for mandamus in SC urging the city toimplementOrdinance 8027. Respondents defense is that Ordinance No. 8027 has been superseded by the MOU and the resolutions and that the MOU was more of a guideline to 8027.

Issues:

1. Whether respondent has the mandatory legal duty to enforce Ordinance No. 8027 and order the removal of the Pandacan Terminals, and

2. Whether the June 26, 2002 MOU and the resolutions ratifying it can amend or repeal Ordinance No. 8027

Held: Yes to both, Petition granted

Ratio:

1. Rule 65, Section 316 of the Rules of Court- mandamus may be filed when any tribunal, corporation, board, officer or person unlawfully neglects the performance of an act which the law specifically enjoins as a duty resulting from an office, trust or station. The petitioner should have a well-defined, clear andcertainlegal right to the performance of the act and it must be the clear and imperative duty of respondent to do the act required to be done.

Mandamus will not issue to enforce a right, or to compel compliance with a duty, which is questionable or over which a substantial doubt exists. Unless the right to the relief sought is unclouded, mandamus will not issue.When a mandamus proceeding concerns a public right and its object is to compel a public duty, the people who are interested in the execution of the laws are regarded as the real parties in interest and they need not show any specific interest. Petitioners are citizens of manila and thus have a direct interest in the ordinances.On the other hand, the Local Government Code imposes upon respondent the duty, ascity mayor, to "enforce all laws and ordinances relative to the governance of the city. "One of these is Ordinance No. 8027. As the chief executive of the city, he has the duty to enforce Ordinance No. 8027 as long as it has not been repealed by the Sanggunian or annulled by the courts. He has no other choice. It is his ministerial duty to do so.

These officers cannot refuse to perform their duty on the ground of an alleged invalidity of thestatuteimposing the duty. The reason for this is obvious.It might seriously hinder the transaction of public businessif these officers were to be permitted inall casesto question the constitutionality ofstatutesand ordinances imposing duties upon them and which have not judicially been declared unconstitutional.Officers of the government from the highest tothe lowestare creatures of the law and are bound to obey it.2. Need not resolve this issue. Assuming thatthe termsof the MOU were inconsistent with Ordinance No. 8027, the resolutions which ratified it and made it binding on the City of Manila expressly gave it full force and effectonly until April 30, 2003. MMDA vs Concerned Citizens of Manila Bay, G.R. No. 171947-48, Dec. 18, 2008

The need to address environmental pollution, as a cause of climate change, has of late gained the attention of the international community. Media have finally trained their sights on the ill effects of pollution, the destruction of forests and other critical habitats, oil spills, and the unabated improper disposal of garbage. And rightly so, for the magnitude of environmental destruction is now on a scale few ever foresaw and the wound no longer simply heals by itself. But amidst hard evidence and clear signs of a climate crisis that need bold action, the voice of cynicism, naysayers, and procrastinators can still be heard.

This case turns on government agencies and their officers who, by the nature of their respective offices or by direct statutory command, are tasked to protect and preserve, at the first instance, our internal waters, rivers, shores, and seas polluted by human activities. To most of these agencies and their official complement, the pollution menace does not seem to carry the high national priority it deserves, if their track records are to be the norm. Their cavalier attitude towards solving, if not mitigating, the environmental pollution problem, is a sad commentary on bureaucratic efficiency and commitment.

At the core of the case is the Manila Bay, a place with a proud historic past, once brimming with marine life and, for so many decades in the past, a spot for different contact recreation activities, but now a dirty and slowly dying expanse mainly because of the abject official indifference of people and institutions that could have otherwise made a difference.

Facts:

On January 29, 1999, respondents Concerned Residents of Manila Bay filed a complaint before the Regional Trial Court (RTC) in Imus, Cavite against several government agencies, for the cleanup, rehabilitation, and protection of the Manila Bay.

The complaint alleged that the water quality of the Manila Bay had fallen way below the allowable standards set by law, specifically Presidential Decree No. (PD) 1152 or the Philippine Environment Code.

In their individual causes of action, respondents alleged that the continued neglect of petitioners in abating the pollution of the Manila Bay constitutes a violation of, among others:

(1) Respondents constitutional right to life, health, and a balanced ecology;

(2) The Environment Code (PD 1152);

(3) The Pollution Control Law (PD 984);

(4) The Water Code (PD 1067);

(5) The Sanitation Code (PD 856);

(6) The Illegal Disposal of Wastes Decree (PD 825);

(7) The Marine Pollution Law (PD 979);

(8) Executive Order No. 192;

(9) The Toxic and Hazardous Wastes Law (Republic Act No. 6969);

(10) Civil Code provisions on nuisance and human relations;

(11) The Trust Doctrine and the Principle of Guardianship; and

(12) International Law

Inter alia, respondents, as plaintiffs a quo, prayed that petitioners be ordered to clean the Manila Bay and submit to the RTC a concerted concrete plan of action for the purpose.

Issues:

a) Whether or not pertinent provisions of the Environment Code (PD 1152) relate only to the cleaning of specific pollution incidents and do not cover cleaning in general.

b) Whether or not the cleaning of the Manila Bay is not a ministerial act which can be compelled by mandamus.

Held:

Regional Trial Courts Order to Clean Up and Rehabilitate Manila Bay

On September 13, 2002, the RTC rendered a Decision in favor of respondents. Finding merit in the complaint, the Court ordered defendant-government agencies, jointly and solidarily, to clean up and rehabilitate Manila Bay and restore its waters to SB classification to make it fit for swimming, skin-diving and other forms of contact recreation.

To attain this, defendant-agencies, with defendant DENR as the lead agency, are directed, within six (6) months from receipt hereof, to act and perform their respective duties by devising a consolidated, coordinated and concerted scheme of action for the rehabilitation and restoration of the bay.

In particular:

Defendant MWSS is directed to install, operate and maintain adequate [sewerage] treatment facilities in strategic places under its jurisdiction and increase their capacities.

Defendant LWUA, to see to it that the water districts under its wings, provide, construct and operate sewage facilities for the proper disposal of waste.

Defendant DENR, which is the lead agency in cleaning up Manila Bay, to install, operate and maintain waste facilities to rid the bay of toxic and hazardous substances.

Defendant PPA, to prevent and also to treat the discharge not only of ship-generated wastes but also of other solid and liquid wastes from docking vessels that contribute to the pollution of the bay.

Defendant MMDA, to establish, operate and maintain an adequate and appropriate sanitary landfill and/or adequate solid waste and liquid disposal as well as other alternative garbage disposal system such as re-use or recycling of wastes.

Defendant DA, through the Bureau of Fisheries and Aquatic Resources, to revitalize the marine life in Manila Bay and restock its waters with indigenous fish and other aquatic animals.

Defendant DBM, to provide and set aside an adequate budget solely for the purpose of cleaning up and rehabilitation of Manila Bay.

Defendant DPWH, to remove and demolish structures and other nuisances that obstruct the free flow of waters to the bay. These nuisances discharge solid and liquid wastes which eventually end up in Manila Bay. As the construction and engineering arm of the government, DPWH is ordered to actively participate in removing debris, such as carcass of sunken vessels, and other non-biodegradable garbage in the bay.

Defendant DOH, to closely supervise and monitor the operations of septic and sludge companies and require them to have proper facilities for the treatment and disposal of fecal sludge and sewage coming from septic tanks.

Defendant DECS, to inculcate in the minds and hearts of the people through education the importance of preserving and protecting the environment.

Defendant Philippine Coast Guard and the PNP Maritime Group, to protect at all costs the Manila Bay from all forms of illegal fishing.

The Court of Appeals Sustained the RTCs Decision

The MWSS, Local Water Utilities Administration (LWUA), and PPA filed before the Court of Appeals (CA) individual Notices of Appeal. On the other hand, the DENR, Department of Public Works and Highways (DPWH), Metropolitan Manila Development Authority (MMDA), Philippine Coast Guard (PCG), Philippine National Police (PNP) Maritime Group, and five other executive departments and agencies filed directly with this Court a petition for review under Rule 45.

In the light of the ongoing environmental degradation, the Court wishes to emphasize the extreme necessity for all concerned executive departments and agencies to immediately act and discharge their respective official duties and obligations. Indeed, time is of the essence; hence, there is a need to set timetables for the performance and completion of the tasks, some of them as defined for them by law and the nature of their respective offices and mandates.

The importance of the Manila Bay as a sea resource, playground, and as a historical landmark cannot be over-emphasized. It is not yet too late in the day to restore the Manila Bay to its former splendor and bring back the plants and sea life that once thrived in its blue waters. But the tasks ahead, daunting as they may be, could only be accomplished if those mandated, with the help and cooperation of all civic-minded individuals, would put their minds to these tasks and take responsibility. This means that the State, through petitioners, has to take the lead in the preservation and protection of the Manila Bay.

So it was that in Oposa v. Factoran, Jr. the Court stated that the right to a balanced and healthful ecology need not even be written in the Constitution for it is assumed, like other civil and political rights guaranteed in the Bill of Rights, to exist from the inception of mankind and it is an issue of transcendental importance with intergenerational implications. Even assuming the absence of a categorical legal provision specifically prodding petitioners to clean up the bay, they and the men and women representing them cannot escape their obligation to future generations of Filipinos to keep the waters of the Manila Bay clean and clear as humanly as possible. Anything less would be a betrayal of the trust reposed in them.

By a Decision of September 28, 2005, the CA denied petitioners appeal and affirmed the Decision of the RTC in toto, stressing that the trial courts decision did not require petitioners to do tasks outside of their usual basic functions under existing laws.

Constitutional Provisions: Utilization of Natural Resources

Regalian Doctrine

The 1935 Constitution classified lands of the public domain into agricultural, forest or timber.[40] Meanwhile, the 1973 Constitution provided the following divisions: agricultural, industrial or commercial, residential, resettlement, mineral, timber or forest and grazing lands, and such other classes as may be provided by law,[41] giving the government great leeway for classification.[42] Then the 1987 Constitution reverted to the 1935 Constitution classification with one addition: national parks.[43] Of these, only agricultural lands may be alienated.[44] Prior to Proclamation No. 1064 of May 22, 2006, Boracay Island had never been expressly and administratively classified under any of these grand divisions. Boracay was an unclassified land of the public domain.

The Regalian Doctrine dictates that all lands of the public domain belong to the State, that the State is the source of any asserted right to ownership of land and charged with the conservation of such patrimony.[45] The doctrine has been consistently adopted under the 1935, 1973, and 1987 Constitutions.[46]

All lands not otherwise appearing to be clearly within private ownership are presumed to belong to the State.[47] Thus, all lands that have not been acquired from the government, either by purchase or by grant, belong to the State as part of the inalienable public domain.[48] Necessarily, it is up to the State to determine if lands of the public domain will be disposed of for private ownership. The government, as the agent of the state, is possessed of the plenary power as the persona in law to determine who shall be the favored recipients of public lands, as well as under what terms they may be granted such privilege, not excluding the placing of obstacles in the way of their exercise of what otherwise would be ordinary acts of ownership.[49]

Our present land law traces its roots to the Regalian Doctrine. Upon the Spanish conquest of the Philippines, ownership of all lands, territories and possessions in the Philippines passed to the Spanish Crown.[50] The Regalian doctrine was first introduced in the Philippines through the Laws of the Indies and the Royal Cedulas, which laid the foundation that all lands that were not acquired from the Government, either by purchase or by grant, belong to the public domain.[51]

The Laws of the Indies was followed by the Ley Hipotecaria or the Mortgage Law of 1893. The Spanish Mortgage Law provided for the systematic registration of titles and deeds as well as possessory claims.[52]

The Royal Decree of 1894 or the Maura Law[53] partly amended the Spanish Mortgage Law and the Laws of the Indies. It established possessory information as the method of legalizing possession of vacant Crown land, under certain conditions which were set forth in said decree.[54] Under Section 393 of the Maura Law, an informacion posesoria or possessory information title,[55] when duly inscribed in the Registry of Property, is converted into a title of ownership only after the lapse of twenty (20) years of uninterrupted possession which must be actual, public, and adverse,[56] from the date of its inscription.[57] However, possessory information title had to be perfected one year after the promulgation of the Maura Law, or until April 17, 1895. Otherwise, the lands would revert to the State.[58]

In sum, private ownership of land under the Spanish regime could only be founded on royal concessions which took various forms, namely: (1) titulo real or royal grant; (2) concesion especial or special grant; (3) composicion con el estado or adjustment title; (4) titulo de compra or title by purchase; and (5) informacion posesoria or possessory information title.[59]

The first law governing the disposition of public lands in the Philippines under American rule was embodied in the Philippine Bill of 1902.[60] By this law, lands of the public domain in the Philippine Islands were classified into three (3) grand divisions, to wit: agricultural, mineral, and timber or forest lands.[61] The act provided for, among others, the disposal of mineral lands by means of absolute grant (freehold system) and by lease (leasehold system).[62] It also provided the definition by exclusion of agricultural public lands.[63] Interpreting the meaning of agricultural lands under the Philippine Bill of 1902, the Court declared in Mapa v. Insular Government:[64]

x x x In other words, that the phrase agricultural land as used in Act No. 926 means those public lands acquired from Spain which are not timber or mineral lands. x x x[65] (Emphasis Ours)

On February 1, 1903, the Philippine Legislature passed Act No. 496, otherwise known as the Land Registration Act. The act established a system of registration by which recorded title becomes absolute, indefeasible, and imprescriptible. This is known as the Torrens system.[66]

Concurrently, on October 7, 1903, the Philippine Commission passed Act No. 926, which was the first Public Land Act. The Act introduced the homestead system and made provisions for judicial and administrative confirmation of imperfect titles and for the sale or lease of public lands. It permitted corporations regardless of the nationality of persons owning the controlling stock to lease or purchase lands of the public domain.[67] Under the Act, open, continuous, exclusive, and notorious possession and occupation of agricultural lands for the next ten (10) years preceding July 26, 1904 was sufficient for judicial confirmation of imperfect title.[68]

On November 29, 1919, Act No. 926 was superseded by Act No. 2874, otherwise known as the second Public Land Act. This new, more comprehensive law limited the exploitation of agricultural lands to Filipinos and Americans and citizens of other countries which gave Filipinos the same privileges. For judicial confirmation of title, possession and occupation en concepto dueo since time immemorial, or since July 26, 1894, was required.[69]

After the passage of the 1935 Constitution, CA No. 141 amended Act No. 2874 on December 1, 1936. To this day, CA No. 141, as amended, remains as the existing general law governing the classification and disposition of lands of the public domain other than timber and mineral lands,[70] and privately owned lands which reverted to the State.[71]

Section 48(b) of CA No. 141 retained the requirement under Act No. 2874 of possession and occupation of lands of the public domain since time immemorial or since July 26, 1894. However, this provision was superseded by Republic Act (RA) No. 1942,[72] which provided for a simple thirty-year prescriptive period for judicial confirmation of imperfect title. The provision was last amended by PD No. 1073,[73] which now provides for possession and occupation of the land applied for since June 12, 1945, or earlier.[74]

The issuance of PD No. 892[75] on February 16, 1976 discontinued the use of Spanish titles as evidence in land registration proceedings.[76] Under the decree, all holders of Spanish titles or grants should apply for registration of their lands under Act No. 496 within six (6) months from the effectivity of the decree on February 16, 1976. Thereafter, the recording of all unregistered lands[77] shall be governed by Section 194 of the Revised Administrative Code, as amended by Act No. 3344.

On June 11, 1978, Act No. 496 was amended and updated by PD No. 1529, known as the Property Registration Decree. It was enacted to codify the various laws relative to registration of property.[78] It governs registration of lands under the Torrens system as well as unregistered lands, including chattel mortgages.[79]

A positive act declaring land as alienable and disposable is required. In keeping with the presumption of State ownership, the Court has time and again emphasized that there must be a positive act of the government, such as an official proclamation,[80] declassifying inalienable public land into disposable land for agricultural or other purposes.[81] In fact, Section 8 of CA No. 141 limits alienable or disposable lands only to those lands which have been officially delimited and classified.[82]

The burden of proof in overcoming the presumption of State ownership of the lands of the public domain is on the person applying for registration (or claiming ownership), who must prove that the land subject of the application is alienable or disposable.[83] To overcome this presumption, incontrovertible evidence must be established that the land subject of the application (or claim) is alienable or disposable.[84] There must still be a positive act declaring land of the public domain as alienable and disposable. To prove that the land subject of an application for registration is alienable, the applicant must establish the existence of a positive act of the government such as a presidential proclamation or an executive order; an administrative action; investigation reports of Bureau of Lands investigators; and a legislative act or a statute.[85] The applicant may also secure a certification from the government that the land claimed to have been possessed for the required number of years is alienable and disposable.[86] Sec. 2, Art. XII, Const.

Section 2. All lands of the public domain, waters, 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. With the exception of agricultural lands, all other natural resources shall not be alienated. The exploration, development, and utilization of natural resources shall be under the full control and supervision of the State. The State may directly undertake such activities, or it may enter into co-production, joint venture, or production-sharing agreements with Filipino citizens, or corporations or associations at least sixtyper centumof whose capital is owned by such citizens. Such agreements may be for a period not exceeding twenty-five years, renewable for not more than twenty-five years, and under such terms and conditions as may be provided by law. In cases of water rights for irrigation, water supply fisheries, or industrial uses other than the development of water power, beneficial use may be the measure and limit of the grant.

The State shall protect the nations marine wealth in its archipelagic waters, territorial sea, and exclusive economic zone, and reserve its use and enjoyment exclusively to Filipino citizens.

The Congress may, by law, allow small-scale utilization of natural resources by Filipino citizens, as well as cooperative fish farming, with priority to subsistence fishermen and fishworkers in rivers, lakes, bays, and lagoons.

The President may enter into agreements with foreign-owned corporations involving either technical or financial assistance for large-scale exploration, development, and utilization of minerals, petroleum, and other mineral oils according to the general terms and conditions provided by law, based on real contributions to the economic growth and general welfare of the country. In such agreements, the State shall promote the development and use of local scientific and technical resources.

The President shall notify the Congress of every contract entered into in accordance with this provision, within thirty days from its execution. Miners Assoc vs. Factoran, G.R. No. 98332, Jan 16, 1995

Facts :

Former President Corazon Aquino issued Executive Order Nos 211 and 279 in the exercise of her legislative powers. EO No. 211 prescribes the interim procedures in the processing and approval of applications for the exploration, development and utilization of minerals pursuant to Section 2, Article XII of the 1987 Constitution. EO No. 279 authorizes the DENR Secretary to negotiate and conclude joint-venture, co-production, or production- sharing agreements for the exploration, development, and utilization of mineral resources.

The issuance and the impeding implementation by the DENR of Administrative Order Nos. 57 which declares that all existing mining leases or agreements which were granted after the effectivity of the 1987 Constitutionshall be converted into production-sharing agreements within one (1) year from the effectivity of these guidelines. and Administrative Order No. 82 which provides that a failure to submit Letter of Intent and Mineral Production-Sharing Agreement within 2 years from the effectivity of the Department Administrative Order No. 57 shall cause the abandonment of the mining, quarry, and sand and gravel claims, after their respective effectivity dates compelled the Miners Association of the Philippines, Inc., an organization composed of mining prospectors and claim owners and claim holders, to file the instant petition assailing their validity and constitutionality before this Court.

Issue :Are the two Department Administrative Orders valid?

Ruling :

Yes. Petitioner's insistence on the application of Presidential Decree No. 463, as amended, as the governing law on the acceptance and approval of declarations of location and all other kinds of applications for the exploration, development, and utilization of mineral resources pursuant to Executive Order No. 211, is erroneous. Presidential Decree No. 463, as amended, pertains to the old system of exploration, development and utilization of natural resources through "license, concession or lease" which, however, has been disallowed by Article XII, Section 2 of the 1987 Constitution. By virtue of the said constitutional mandate and its implementing law, Executive Order No. 279 which superseded Executive Order No. 211, the provisions dealing on "license, concession or lease" of mineral resources under Presidential Decree No. 463, as amended, and other existing mining laws are deemed repealed and, therefore, ceased to operate as the governing law. In other words, in all other areas of administration and management of mineral lands, the provisions of Presidential Decree No. 463, as amended, and other existing mining laws, still govern. Section 7 of Executive Order No. 279 provides, thus:Sec. 7. All provisions of Presidential Decree No. 463, as amended, other existing mining laws, and their implementing rules and regulations, or parts thereof, which are not inconsistent with the provisions of this Executive Order, shall continue in force and effect.

Well -settled is the rule, however, that regardless of the reservation clause, mining leases or agreements granted by the State, such as those granted pursuant to Executive Order No. 211 referred to this petition, are subject to alterations through a reasonable exercise of the police power of the State.Accordingly, the State, in the exercise of its police power in this regard, may not be precluded by the constitutional restriction on non-impairment of contract from altering, modifying and amending the mining leases or agreements granted under Presidential Decree No. 463, as amended, pursuant to Executive Order No. 211. Police Power, being co-extensive with the necessities of the case and the demands of public interest; extends to all the vital public needs. The passage of Executive Order No. 279 which superseded Executive Order No. 211 provided legal basis for the DENR Secretary to carry into effect the mandate of Article XII, Section 2 of the 1987 Constitution.

WHEREFORE, the petition is DISMISSED for lack of merit.

PICOP vs Base Metal Mining, G.R. No. 163509, Dec 6, 2006

PICOP Resources, Inc. (PICOP) assails the Decision1of the Court of Appeals dated November 28, 2003 and its Resolution2dated May 5, 2004, which respectively denied its petition for review and motion for reconsideration.

The undisputed facts quoted from the appellate court's Decision are as follows:

In 1987, the Central Mindanao Mining and Development Corporation (CMMCI for brevity) entered into a Mines Operating Agreement (Agreement for brevity) with Banahaw Mining and Development Corporation (Banahaw Mining for brevity) whereby the latter agreed to act as Mine Operator for the exploration, development, and eventual commercial operation of CMMCI's eighteen (18) mining claims located in Agusan del Sur.

Pursuant to the terms of the Agreement, Banahaw Mining filed applications for Mining Lease Contracts over the mining claims with the Bureau of Mines. On April 29, 1988, Banahaw Mining was issued a Mines Temporary Permit authorizing it to extract and dispose of precious minerals found within its mining claims. Upon its expiration, the temporary permit was subsequently renewed thrice by the Bureau of Mines, the last being on June 28, 1991.

Since a portion of Banahaw Mining's mining claims was located in petitioner PICOP's logging concession in Agusan del Sur, Banahaw Mining and petitioner PICOP entered into a Memorandum of Agreement, whereby, in mutual recognition of each other's right to the area concerned, petitioner PICOP allowed Banahaw Mining an access/right of way to its mining claims.

In 1991, Banahaw Mining converted its mining claims to applications for Mineral Production Sharing Agreements (MPSA for brevity).

While the MPSA were pending, Banahaw Mining, on December 18, 1996, decided to sell/assign its rights and interests over thirty-seven (37) mining claims in favor of private respondent Base Metals Mineral Resources Corporation (Base Metals for brevity). The transfer included mining claims held by Banahaw Mining in its own right as claim owner, as well as those covered by its mining operating agreement with CMMCI.

Upon being informed of the development, CMMCI, as claim owner, immediately approved the assignment made by Banahaw Mining in favor of private respondent Base Metals, thereby recognizing private respondent Base Metals as the new operator of its claims.

On March 10, 1997, private respondent Base Metals amended Banahaw Mining's pending MPSA applications with the Bureau of Mines to substitute itself as applicant and to submit additional documents in support of the application. Area clearances from the DENR Regional Director and Superintendent of the Agusan Marsh and Wildlife Sanctuary were submitted, as required.

On October 7, 1997, private respondent Base Metals' amended MPSA applications were published in accordance with the requirements of the Mining Act of 1995.

On November 18, 1997, petitioner PICOP filed with the Mines Geo-Sciences Bureau (MGB), Caraga Regional Office No. XIII an Adverse Claim and/or Opposition to private respondent Base Metals' application on the following grounds:

I. THE APPROVAL OF THE APPLICATION AND ISSUANCE OF THE MPSA OF BASE METALS WILL VIOLATE THE CONSTITUTIONAL MANDATE AGAINST IMPAIRMENT OF OBLIGATION IN A CONTRACT.

II. THE APPROVAL OF THE APPLICATION WILL DEFEAT THE RIGHTS OF THE HEREIN ADVERSE CLAIMANT AND/OR OPPOSITOR.

In its Answer to the Adverse Claim and/or Opposition, private respondent Base Metals alleged that:

a) the Adverse Claim was filed out of time;

b) petitioner PICOP has no rights over the mineral resources on their concession area. PICOP is asserting a privilege which is not protected by the non-impairment clause of the Constitution;

c) the grant of the MPSA will not impair the rights of PICOP nor create confusion, chaos or conflict.

Petitioner PICOP's Reply to the Answer alleged that:

a) the Adverse Claim was filed within the reglementary period;

b) the grant of MPSA will impair the existing rights of petitioner PICOP;

c) the MOA between PICOP and Banahaw Mining provides for recognition by Banahaw Mining of the Presidential Warranty awarded in favor of PICOP for the exclusive possession and enjoyment of said areas.

As a Rejoinder, private respondent Base Metals stated that:

1. it is seeking the right to extract the mineral resources in the applied areas. It is not applying for any right to the forest resources within the concession areas of PICOP;

2. timber or forest lands are open to Mining Applications;

3. the grant of the MPSA will not violate the so called "presidential fiat";

4. the MPSA application of Base Metals does not require the consent of PICOP; and

5. it signified its willingness to enter into a voluntary agreement with PICOP on the matter of compensation for damages. In the absence of such agreement, the matter will be brought to the Panel of Arbitration in accordance with law.

In refutation thereto, petitioner PICOP alleged in its Rejoinder that:

a) the Adverse Claim filed thru registered mail was sent on time and as prescribed by existing mining laws and rules and regulations;

b) the right sought by private respondent Base Metals is not absolute but is subject to existing rights, such as those which the adverse claimant had, that have to be recognized and respected in a manner provided and prescribed by existing laws as will be expounded fully later;

c) as a general rule, mining applications within timber or forest lands are subject to existing rights as provided in Section 18 of RA 7942 or the Philippine Mining Act of 1995 and it is an admitted fact by the private respondent that petitioner PICOP had forest rights as per Presidential Warranty;

d) while the Presidential Warranty did not expressly state exclusivity, P.D. 705 strengthened the right of occupation, possession and control over the concession area;

e) the provisions of Section 19 of the Act and Section 15 of IRR expressly require the written consent of the forest right holder, PICOP.

After the submission of their respective position paper, the Panel Arbitrator issued an Order dated December 21, 1998, the dispositive portion of which reads as:

WHEREFORE, premises considered, Mineral Production Sharing Agreement Application Nos. (XIII) 010, 011, 012 of Base Metal Resources Corporation should be set aside.

The disapproval of private respondent Base Metals' MPSA was due to the following reasons:

Anent the first issue the Panel find (sic) and so hold (sic) that the adverse claim was filed on time, it being mailed on November 19, 1997, at Metro Manila as evidenced by Registry Receipt No. 26714. Under the law (sic) the date of mailing is considered the date of filing.

As to whether or not an MPSA application can be granted on area subject of an IFMA3or PTLA4which is covered by a Presidential Warranty, the panel believes it can not, unless the grantee consents thereto. Without the grantee's consent, the area is considered closed to mining location (sec. 19) (b) (No. 2), DAO No. 96-40). The Panel believe (sic) that mining location in forest or timberland is allowed only if such forest or timberland is not leased by the government to a qualified person or entity. If it is leased the consent of the lessor is necessary, in addition to the area clearance to be issued by the agency concerned before it is subjected to mining operation.

Plantation is considered closed to mining locations because it is off tangent to mining. Both are extremes. They can not exist at the same time. The other must necessarily stop before the other operate.

On the other hand, Base Metals Mineral Resources Corporation can not insist the MPSA application as assignee of Banahaw. PICOP did not consent to the assignment as embodied in the agreement. Neither did it ratify the Deed of Assignment. Accordingly, it has no force and effect. Thus, for lack of consent, the MPSA must fall.

On January 11, 1999, private respondent Base Metals filed a Notice of Appeal with public respondent MAB and alleged in its Appeal Memorandum the following arguments:

1. THE CONSENT OF PICOP IS NOT NECESSARY FOR THE APPROVAL OF BASE METALS' MPSA APPLICATION.

2. EVEN ASSUMING SUCH CONSENT IS NECESSARY, PICOP HAD CONSENTED TO BASE METALS' MPSA APPLICATION.

In Answer thereto, petitioner PICOP alleged that:

1. Consent is necessary for the approval of private respondent's MPSA application;

2. Provisions of Memorandum Order No. 98-03 and IFMA 35 are not applicable to the instant case;

3. Provisions of PD 7055connotes exclusivity for timber license holders; and

4. MOA between private respondent's assignor and adverse claimant provided for the recognition of the latter's rightful claim over the disputed areas.

Private respondent Base Metals claimed in its Reply that:

1. The withholding of consent by PICOP derogates the State's power to supervise and control the exploration, utilization and development of all natural resources;

2. Memorandum Order No, 98-03, not being a statute but a mere guideline imposed by the Secretary of the Department of Environment and Natural Resources (DENR), can be applied retroactively to MPSA applications which have not yet been finally resolved;

3. Even assuming that the consent of adverse claimant is necessary for the approval of Base Metals' application (which is denied), such consent had already been given; and

4. The Memorandum of Agreement between adverse claimant and Banahaw Mining proves that the Agusan-Surigao area had been used in the past both for logging and mining operations.

After the filing of petitioner PICOP's Reply Memorandum, public respondent rendered the assailed decision setting aside the Panel Arbitrator's order. Accordingly, private respondent Base Metals' MPSA's were reinstated and given due course subject to compliance with the pertinent requirements of the existing rules and regulations.6The Court of Appeals upheld the decision of the MAB, ruling that the Presidential Warranty of September 25, 1968 issued by then President Ferdinand E. Marcos merely confirmed the timber license granted to PICOP and warranted the latter's peaceful and adequate possession and enjoyment of its concession areas. It was only given upon the request of the Board of Investments to establish the boundaries of PICOP's timber license agreement. The Presidential Warranty did not convert PICOP's timber license into a contract because it did not create any obligation on the part of the government in favor of PICOP. Thus, the non-impairment clause finds no application.

Neither did the Presidential Warranty grant PICOP the exclusive possession, occupation and exploration of the concession areas covered. If that were so, the government would have effectively surrendered its police power to control and supervise the exploration, development and utilization of the country's natural resources.

On PICOP's contention that its consent is necessary for the grant of Base Metals' MPSA, the appellate court ruled that the amendment to PTLA No. 47 refers to the grant of gratuitous permits, which the MPSA subject of this case is not. Further, the amendment pertains to the cutting and extraction of timber for mining purposes and not to the act of mining itself, the intention of the amendment being to protect the timber found in PICOP's concession areas.

The Court of Appeals noted that the reinstatement of the MPSA does notipso factorevoke, amend, rescind or impair PICOP's timber license. Base Metals still has to comply with the requirements for the grant of a mining permit. The fact, however, that Base Metals had already secured the necessary Area Status and Clearance from the DENR means that the areas applied for are not closed to mining operations.

In its Resolution7dated May 5, 2004, the appellate court denied PICOP's Motion for Reconsideration. It ruled that PICOP failed to substantiate its allegation that the area applied for is a forest reserve and is therefore closed to mining operations because it did not identify the particular law which set aside the contested area as one where mining is prohibited pursuant to applicable laws.

The case is now before us for review.

In its Memorandum8dated April 6, 2005, PICOP presents the following issues: (1) the 2,756 hectares subject of Base Metals' MPSA are closed to mining operations except upon PICOP's written consent pursuant to existing laws, rules and regulations and by virtue of the Presidential Warranty; (2) its Presidential Warranty is protected by the non-impairment clause of the Constitution; and (3) it does not raise new issues in its petition.

PICOP asserts that its concession areas are closed to mining operations as these are within the Agusan-Surigao-Davao forest reserve established under Proclamation No. 369 of then Gov. Gen. Dwight Davis. The area is allegedly also part of permanent forest established under Republic Act No. 3092 (RA 3092),9and overlaps the wilderness area where mining applications are expressly prohibited under RA 7586.10Hence, the area is closed to mining operations under Sec. 19(f) of RA 7942.11PICOP further asserts that to allow mining over a forest or forest reserve would allegedly be tantamount to changing the classification of the land from forest to mineral land in violation of Sec. 4, Art. XII of the Constitution and Sec. 1 of RA 3092.

According to PICOP, in 1962 and 1963, blocks A, B and C within the Agusan-Surigao-Davao forest reserve under Proclamation No. 369 were surveyed as permanent forest blocks in accordance with RA 3092. These areas cover PICOP's PTLA No. 47, part of which later became IFMA No. 35. In turn, the areas set aside as wilderness as in PTLA No. 47 became the initial components of the NIPAS under Sec. 5(a) of RA 7586. When RA 7942 was signed into law, the areas covered by the NIPAS were expressly determined as areas where mineral agreements or financial or technical assistance agreement applications shall not be allowed. PICOP concludes that since there is no evidence that the permanent forest areas within PTLA No. 47 and IFMA No. 35 have been set aside for mining purposes, the MAB and the Court of Appeals gravely erred in reinstating Base Metals' MPSA and, in effect, allowing mining exploration and mining-related activities in the protected areas.

PICOP further argues that under DENR Administrative Order (DAO) No. 96-40 implementing RA 7942, an exploration permit must be secured before mining operations in government reservations may be undertaken. There being no exploration permit issued to Banahaw Mining or appended to its MPSA, the MAB and the Court of Appeals should not have reinstated its application.

PICOP brings to the Court's attention the case ofPICOP Resources, Inc. v. Hon. Heherson T. Alvarez,12wherein the Court of Appeals ruled that the Presidential Warranty issued to PICOP for its TLA No. 43 dated July 29, 1969, a TLA distinct from PTLA No. 47 involved in this case, is a valid contract involving mutual prestations on the part of the Government and PICOP.

The Presidential Warranty in this case is allegedly not a mere confirmation of PICOP's timber license but a commitment on the part of the Government that in consideration of PICOP's investment in the wood-processing business, the Government will assure the availability of the supply of raw materials at levels adequate to meet projected utilization requirements. The guarantee that PICOP will have peaceful and adequate possession and enjoyment of its concession areas is impaired by the reinstatement of Base Metals' MPSA in that the latter's mining activitiesunderneaththe area in dispute will surely undermine PICOP's supply of raw materialson the surface.

Base Metals' obtention of area status and clearance from the DENR is allegedly immaterial, even misleading. The findings of the DENR Regional Disrector and the superintendent of the Agusan Marsh and Wildlife Sanctuary are allegedly misplaced because the area applied for is not inside the Agusan Marsh but in a permanent forest. Moreover, the remarks in the area status itself should have been considered by the MAB and the appellate court as they point out that the application encroaches on surveyed timberland projects declared as permanent forests/forest reserves.

Finally, PICOP insists that it has always maintained that the forest areas of PTLA No. 47 and IFMA No. 35 are closed to mining operations. The grounds relied upon in this petition are thus not new issues but merely amplifications, clarifications and detailed expositions of the relevant constitutional provisions and statutes regulating the use and preservation of forest reserves, permanent forest, and protected wilderness areas given that the areas subject of the MPSA are within and overlap PICOP's PTLA No. 47 and IFMA No. 35 which have been classified and blocked not only as permanent forest but also as protected wilderness area forming an integral part of the Agusan-Davao-Surigao Forest Reserve.

In its undated Memorandum,13Base Metals contends that PICOP never made any reference to land classification or the exclusion of the contested area from exploration and mining activities except in the motion for reconsideration it filed with the Court of Appeals. PICOP's object to the MPSA was allegedly based exclusively on the ground that the application, if allowed to proceed, would constitute a violation of the constitutional proscription against impairment of the obligation of contracts. It was upon this issue that the appellate court hinged its Decision in favor of Base Metals, ruling that the Presidential Warranty merely confirmed PICOP's timber license. The instant petition, which raises new issues and invokes RA 3092 and RA 7586, is an unwarranted departure from the settled rule that only issues raised in the proceedingsa quomay be elevated on appeal.

Base Metals notes that RA 7586 expressly requires that there be a prior presidential decree, presidential proclamation, or executive order issued by the President of the Philippines, expressly proclaiming, designating, and setting aside the wilderness area before the same may be considered part of the NIPAS as a protected area. Allegedly, PICOP has not shown that such an express presidential proclamation exists setting aside the subject area as a forest reserve, and excluding the same from the commerce of man.

PICOP also allegedly misquoted Sec. 19 of RA 7942 by placing a comma between the words "watershed" and "forest" thereby giving an altogether different and misleading interpretation of the cited provision. The cited provision, in fact, states that for an area to be closed to mining applications, the same must be a watershed forest reserve duly identified and proclaimed by the President of the Philippines. In this case, no presidential proclamation exists setting aside the contested area as such.

Moreover, the Memorandum of Agreement between Banahaw Mining and PICOP is allegedly a clear and tacit recognition by the latter that the area is open and available for mining activities and that Banahaw Mining has a right to enter and explore the areas covered by its mining claims.

Base Metals reiterates that the non-impairment clause is a limit on the exercise of legislative power and not of judicial or quasi-judicial power. The Constitution prohibits the passage of a law which enlarges, abridges or in any manner changes the intention of the contracting parties. The decision of the MAB and the Court of Appeals are not legislative acts within the purview of the constitutional proscription. Besides, the Presidential Warranty is not a contract that may be impaired by the reinstatement of the MPSA. It is a mere confirmation of PICOP's timber license and draws its life from PTLA No. 47. Furthermore, PICOP fails to show how the reinstatement of the MPSA will impair its timber license.

Following the regalian doctrine, Base Metals avers that the State may opt to enter into contractual arrangements for the exploration, development, and extraction of minerals even it the same should mean amending, revising, or even revoking PICOP's timber license. To require the State to secure PICOP's prior consent before it can enter into such contracts allegedly constitutes an undue delegation of sovereign power.

Base Metals further notes that Presidential Decree No. 705 (PD 705), under which PTLA No. 47, IFMA No. 35 and the Presidential Warranty were issued, requires notice to PICOP rather than consent before any mining activity can be commenced in the latter's concession areas.

The Office of the Solicitor General (OSG) filed a Memorandum14dated April 21, 2005 on behalf of the MAB, contending that PICOP's attempt to raise new issues, such as its argument that the contested area is classified as a permanent forest and hence, closed to mining activities, is offensive to due process and should not be allowed.

The OSG argues that a timber license is not a contract within the purview of the due process and non-impairment clauses. The Presidential Warranty merely guarantees PICOP's tenure over its concession area and covers only the right to cut, collect and remove timber therein. It is a mere collateral undertaking and cannot amplify PICOP's rights under its PTLA No. 47 and IFMA No. 35. To hold that the Presidential Warranty is a contract separate from PICOP's timber license effectively gives the latter PICOP an exclusive, perpetual and irrevocable right over its concession area and impairs the State's sovereign exercise of its power over the exploration, development, and utilization of natural resources.

The case ofPICOP Resources, Inc. v. Hon. Heherson T. Alvarez, supra,cited by PICOP cannot be relied upon to buttress the latter's claim that a presidential warranty is a valid and subsisting contract between PICOP and the Government because the decision of the appellate court in that case is still pending review before the Court's Second Division.

The OSG further asserts that mining operations are legally permissible over PICOP's concession areas. Allegedly, what is closed to mining applications under RA 7942 are areas proclaimed as watershed forest reserves. The law does not totally prohibit mining operations over forest reserves. On the contrary, Sec. 18 of RA 7942 permits mining over forest lands subject to existing rights and reservations, and PD 705 allows mining over forest lands and forest reservations subject to State regulation and mining laws. Sec. 19(a) of RA 7942 also provides that mineral activities may be allowed even over military and other government reservations as long as there is a prior written clearance by the government agency concerned.

The area status clearances obtained by Base Metals also allegedly show that the area covered by the MPSA is within timberland, unclassified public forest, and alienable and disposable land. Moreover, PICOP allegedly chose to cite portions ofApex Mining Corporation v. Garcia,15to make it appear that the Court in that case ruled that mining is absolutely prohibited in the Agusan-Surigao-Davao Forest Reserve. In fact, the Court held that the area is not open to mining location because the proper procedure is to file an application for a permit to prospect with the Bureau of Forest and Development.

In addition, PICOP's claimed wilderness area has not been designated as a protected area that would operate to bar mining operations therein. PICOP failed to prove that the alleged wilderness area has been designated as an initial component of the NIPAS pursuant to a law, presidential decree, presidential proclamation or executive order. Hence, it cannot correctly claim that the same falls within the coverage of the restrictive provisions of RA 7586.

The OSG points out that the Administrative Code of 1917 which RA 3092 amended has been completely repealed by the Administrative Code of 1978. Sec. 4, Art. XII of the 1987 Constitution, on the other hand, provides that Congress shall determine the specific limits of forest lands and national parks, marking clearly their boundaries on the ground. Once this is done, the area thus covered by said forest lands and national parks may not be expanded or reduced except also by congressional legislation. Since Congress has yet to enact a law determining the specific limits of the forest lands covered by Proclamation No. 369 and marking clearly its boundaries on the ground, there can be no occasion that could give rise to a violation of the constitutional provision.

Moreover, Clauses 10 and 14 of PICOP's IFMA No. 35 specifically provides that the area covered by the agreement is open for mining if public interest so requires. Likewise, PTLA No. 47 provides that the area covered by the license agreement may be opened for mining purposes.

Finally, the OSG maintains that pursuant to the State's policy of multiple land use, R.A. No. 7942 provides for appropriate measures for a harmonized utilization of the forest resources and compensation for whatever damage done to the property of the surface owner or concessionaire as a consequence of mining operations. Multiple land use is best demonstrated by the Memorandum of Agreement between PICOP and Banahaw Mining.

First, the procedural question of whether PICOP is raising new issues in the instant petition. It is the contention of the OSG and Base Metals that PICOP's argument that the area covered by the MPSA is classified as permanent forest and therefore closed to mining activities was raised for the first time in PICOP's motion for reconsideration with the Court of Appeals.

Our own perusal of the records of this case reveals that this is not entirely true.

In its Adverse Claim and/or Opposition16dated November 19, 1997 filed with the MGB Panel of Arbitrators, PICOP already raised the argument that the area applied for by Base Metals is classified as a permanent forest determined to be needed for forest purposes pursuant to par. 6, Sec. 3 of PD 705, as amended. PICOP then proceeded to claim that the area should remain forest land if the purpose of the presidential fiat were to be followed. It stated:

Technically, the areas applied for by Base Metals are classified as a permanent forest being land of the public domain determined to be needed for forest purposes (Paragraph 6, Section 3 of Presidential Decree No. 705, as amended) If these areas then are classified and determined to be needed for forest purpose then they should be developed and should remain as forest lands. Identifying, delineating and declaring them for other use or uses defeats the purpose of the aforecited presidential fiats. Again, if these areas would be delineated from Oppositor's forest concession, the forest therein would be destroyed and be lost beyond recovery.17Base Metals met this argument head on in its Answer18dated December 1, 1997, in which it contended that PD 705 does not exclude mining operations in forest lands but merely requires that there be proper notice to the licensees of the area.

Again in its Petition19dated January 25, 2003 assailing the reinstatement of Base Metals' MPSA, PICOP argued that RA 7942 expressly prohibits mining operations in plantation areas such as PICOP's concession area. Hence, it posited that the MGB Panel of Arbitrators did not commit grave abuse of discretion when it ruled that without PICOP's consent, the area is closed to mining location.

It is true though that PICOP expounded on the applicability of RA 3092, RA 7586, and RA 7942for the first timein its motion for reconsideration of the appellate court's Decision. It was only in its motion for reconsideration that PICOP argued that the area covered by PTLA No. 47 and IFMA No. 35 are permanent forest lands covered by RA 7586 which cannot be entered for mining purposes, and shall remain indefinitely as such for forest uses and cannot be excluded or diverted for other uses except after reclassification through a law enacted by Congress.

Even so, we hold that that the so-callednew issuesraised by PICOP are well within the issues framed by the parties in the proceedingsa quo.Thus, they are not, strictly speaking, being raised for the first time on appeal.20Besides, Base Metals and the OSG have been given ample opportunity, by way of the pleadings filed with this Court, to respond to PICOP's arguments. It is in the best interest of justice that we settle the crucial question of whether the concession area in dispute is open to mining activities.

We should state at this juncture that the policy of multiple land use is enshrined in our laws towards the end that the country's natural resources may be rationally explored, developed, utilized and conserved. The Whereas clauses and declaration of policies of PD 705 state:

WHEREAS, proper classification, management and utilization of the lands of the public domain to maximize their productivity to meet the demands of our increasing population is urgently needed;

WHEREAS, to achieve the above purpose, it is necessary to reassess the multiple uses of forest lands and resources before allowing any utilization thereof to optimize the benefits that can be derived therefrom;

Sec. 2. Policies.The State hereby adopts the following policies:

a) The multiple uses of forest lands shall be oriented to the development and progress requirements of the country, the advancement of science and technology, and the public welfare;

In like manner, RA 7942, recognizing the equiponderance between mining and timber rights, gives a mining contractor the right to enter a timber concession and cut timber therein provided that the surface owner or concessionaire shall be properly compensated for any damage done to the property as a consequence of mining operations. The pertinent provisions on auxiliary mining rights state:

Sec. 72.Timber Rights.Any provision of law to the contrary notwithstanding, a contractor may be granted a right to cut trees or timber within his mining areas as may be necessary for his mining operations subject to forestry laws, rules and regulations:Provided,That if the land covered by the mining area is already covered by existing timber concessions, the volume of timber needed and the manner of cutting and removal thereof shall be determined by the mines regional director, upon consultation with the contractor, the timber concessionair/permittee and the Forest Management Bureau of the Department:Provided, further,That in case of disagreement between the contractor and the timber concessionaire, the matter shall be submitted to the Secretary whose decision shall be final. The contractor shall perform reforestation work within his mining area in accordance with forestry laws, rules and regulations.

Sec. 76.Entry into Private Lands and Concession Areas.Subject to prior notification, holders of mining rights shall not be prevented from entry into private lands and concession areas by surface owners, occupants, or concessionaires when conducting mining operations therein:Provided,That any damage done 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:Provided, further,That to guarantee such compensation, the person authorized to conduct mining operation shall, prior thereto, post a bond with the regional director based on the type of properties, the prevailing prices in and around the area where the mining operations are to be conducted, with surety or sureties satisfactory to the regional director.

With the foregoing predicates, we shall now proceed to analyze PICOP's averments.

PICOP contends that its concession area is within the Agusan-Surigao-Davao Forest Reserve established under Proclamation No. 369 and is closed to mining application citing several paragraphs of Sec. 19 of RA 7942.

The cited provision states:

Sec. 19Areas Closed to Mining Applications.Mineral agreement or financial or technical assistance agreement applications shall not be allowed:

(a) In military and other government reservations, except upon prior written clearance by the government agency concerned;

(d) In areas expressly prohibited by law;

(f) Old growth or virgin forests,proclaimed watershed forest reserves, wilderness areas,mangrove forests, mossy forests, national parks, provincial/municipal forests, parks, greenbelts, game refuge and bird sanctuaries as defined by law in areas expressly prohibited under the National Ingrated Protected Areas System (NIPAS) under Republic Act No. 7586, Department Administrative Order No. 25, series of 1992 and other laws. [emphasis supplied]

We analyzed each of the categories under which PICOP claims that its concession area is closed to mining activities and conclude that PICOP's contention must fail.

Firstly,assuming that the area covered by Base Metals' MPSA is a government reservation, defined as proclaimed reserved lands for specific purposes other than mineral reservations,21such does not necessarily preclude mining activities in the area. Sec. 15(b) of DAO 96-40 provides that government reservations may be opened for mining applications upon prior written clearance by the government agency having jurisdiction over such reservation.

Sec. 6 of RA 7942 also provides that mining operations in reserved lands other than mineral reservations may be undertaken by the DENR, subject to certain limitations. It provides:

Sec. 6.Other Reservations.Mining operations in reserved lands other than mineral reservations may be undertaken by the Department, subject to limitations as herein provided. In the event that the Department cannot undertake such activities, they may be undertaken by a qualified person in accordance with the rules and regulations promulgated by the Secretary. The right to develop and utilize the minerals found therein shall be awarded by the President under such terms and conditions as recommended by the Director and approved by the Secretary:Provided,That the party who undertook the exploration of said reservations shall be given priority. The mineral land so awarded shall be automatically excluded from the reservation during the term of the agreement:Provided, further,That the right of the lessee of a valid mining contract existing within the reservation at the time of its establishment shall not be prejudiced or impaired.

Secondly,RA 7942 does not disallow mining applications in all forest reserves but only thoseproclaimed aswatershed forest reserves. There is no evidence in this case that the area covered by Base Metals' MPSA has been proclaimed as watershed forest reserves.

Even granting that the area covered by the MPSA is part of the Agusan-Davao-Surigao Forest Reserve, such does not necessarily signify that the area is absolutely closed to mining activities. Contrary to PICOP's obvious misreading of our decision inApex Mining Co., Inc. v. Garcia, supra,to the effect that mineral agreements are not allowed in the forest reserve established under Proclamation 369, the Court in that case actually ruled that pursuant to PD 463 as amended by PD 1385, one can acquire mining rights within forest reserves, such as the Agusan-Davao-Surigao Forest Reserve, by initially applying for a permit to prospect with the Bureau of Forest and Development and subsequently for a permit to explore with the Bureau of Mines and Geosciences.

Moreover, Sec. 18 RA 7942 allows mining even in timberland or forestty subject to existing rights and reservations. It provides:

Sec. 18.Areas Open to Mining Operations.Subject to any existing rights or reservations and prior agreements of all parties, all mineral resources in public or private lands, including timber or forestlands as defined in existing laws, shall be open to mineral agreements or financial or technical assistance agreement applications. Any conflict that may arise under this provision shall be heard and resolved by the panel of arbitrators.

Similarly, Sec. 47 of PD 705 permits mining operations in forest lands which include the public forest, the permanent forest or forest reserves, and forest reservations.22It states:

Sec. 47. Mining Operations.Mining operations in forest lands shall be regulated and conducted with due regard to protection, development and utilization of other surface resources. Location, prospecting, exploration, utilization or exploitation of mineral resources in forest reservations shall be governed by mining laws, rules and regulations. No location, prospecting, exploration, utilization, or exploitation of mineral resources inside forest concessions shall be allowed unless proper notice has been served upon the licensees thereof and the prior approval of the Director, secured.

Significantly, the above-quoted provision does not require that the consent of existing licensees be obtained but that they be notified before mining activities may be commenced inside forest concessions.

DENR Memorandum Order No. 03-98, which provides the guidelines in the issuance of area status and clearance or consent for mining applications pursuant to RA 7942, provides that timber or forest lands, military and other government reservations, forest reservations, forest reserves other than critical watershed forest reserves, and existing DENR Project Areas within timber or forest lands, reservations and reserves, among others, are open to mining applications subject to area status and clearance.

To this end, area status clearances or land status certifications have been issued to Base Metals relative to its mining right application, to wit:

II. MPSA No. 010

1. Portion colored green is the area covered by the aforestated Timberland Project No. 31-E, Block A and Project No. 59-C, Block A, L.C. Map No. 2466 certified as such on June 30, 1961; and

2. Shaded brown represent CADC claim.23III. MPSA No. 011

1. The area applied covers the Timberland, portion of Project No. 31-E, Block-E, L.C. Map No. 2468 and Project No. 36-A Block II, Alienable and Disposable Land, L.C. Map No. 1822, certified as such on June 30, 1961 and January 1, 1955, respectively;

2. The green shade is the remaining portion of Timber Land Project;

3. The portion colored brown is an applied and CADC areas;

4. Red shade denotes alienable and disposable land.24IV. MPSA No. 012

Respectfully returned herewith is the folder of Base Metals Mineral Resources Corporation, applied under Mineral Production Sharing Agreement (MPSA (XIII) 012), referred to this office per memorandum dated August 5, 1997 for Land status certification and the findings based on available references file this office, the site is within the unclassified Public Forest of the LGU, Rosario, Agusan del Sur. The shaded portion is the wilderness area of PICOP Resources Incorporated (PRI), Timber License Agreement.25V. MPSA No. 013

1. The area status shaded green falls within Timber Land, portion of Project No. 31-E, Block-A, Project No. 59-C, Block-A, L.C. Map No. 2468 certified as such on June 30, 1961;

2. Colored brown denotes a portion claimed as CADC areas;

3. Violet shade represent a part of reforestation project of PRI concession; and

4. The yellow color is identical to unclassified Public Forest of said LGU and the area inclosed in Red is the wilderness area of PICOP Resources, Inc. (PRI), Timber License Agreement.26Thirdly,PICOP failed to present any evidence that the area covered by the MPSA is a protected wilderness area designated as an initial component of the NIPAS pursuant to a law, presidential decree, presidential proclamation or executive order as required by RA 7586.

Sec. 5(a) of RA 7586 provides:

Sec. 5.Establishment and Extent of the System.The establishment and operationalization of the System shall involve the following:

(a) All areas or islands in the Philippinesproclaimed, designated or set aside, pursuant to a law, presidential decree, presidential proclamation or executive order asnational park, game refuge, bird and wildlife sanctuary,wilderness area, strict nature reserve, watershed, mangrove reserve, fish sanctuary, natural and historical landmark, protected and managed landscape/seascape as well as identified virgin forests before the effectivity of this Act are hereby designated as initial components of the System. The initial components of the System shall be governed by existing laws, rules and regulations, not inconsistent with this Act.

Although the above-cited area status and clearances, particularly those pertaining to MPSA Nos. 012 and 013, state that portions thereof are within the wilderness area of PICOP, there is no showing that this supposed wilderness area has been proclaimed, designated or set aside as such, pursuant to a law, presidential decree, presidential proclamation or executive order. It should be emphasized that it is only when this area has been so designated that Sec. 20 of RA 7586, which prohibits mineral locating within protected areas, becomes operational.

From the foregoing, there is clearly no merit to PICOP's contention that the area covered by Base Metals' MPSA is, by law, closed to mining activities.

Finally, we do not subscribe to PICOP's argument that the Presidential Warranty dated September 25, 1968 is a contract protected by the non-impairment clause of the 1987 Constitution.

An examination of the Presidential Warranty at once reveals that it simply reassures PICOP of the government's commitment to uphold the terms and conditions of its timber license and guarantees PICOP's peaceful and adequate possession and enjoyment of the areas which are the basic sources of raw materials for its wood processing complex. The warranty covers only the right to cut, collect, and remove timber in its concession area, and does not extend to the utilization of other resources, such as mineral resources, occurring within the concession.

The Presidential Warranty cannot be considered a contract distinct from PTLA No. 47 and IFMA No. 35. We agree with the OSG's position that it is merely a collateral undertaking which cannot amplify PICOP's rights under its timber license. Our definitive ruling inOposa v. Factoran27that a timber license is not a contract within the purview of the non-impairment clause is edifying. We declared:

Needless to say, all licenses may thus be revoked or rescinded by executive action. It is not a contract, property or a property right protected by the due process clause of the Constitution. InTan vs. Director of Forestry,this Court held:

"x x x A timber license is an instrument by which the State regulates the utilization and disposition of forest resources to the end that public welfare is promoted.A timber license is not a contract within the purview of the due process clause; it is only a license or a privilege, which can be validly withdrawn whenever dictated by public interest or public welfare as in this case.'A license is merely a permit or privilege to do what otherwise would be unlawful, and is not a contract between the authority, federal, state, or municipal, granting it and the person to whom it is granted; neither is it a property or a property right, nor does it create a vested right; nor is it taxation' (C.J. 168). Thus, this Court held that the granting of license does not create irrevocable rights, neither is it property or property rights (People vs. Ong Tin, 54 O.G. 7576). x x x"

We reiterated this pronouncement inFelipe Ysmael, Jr. & Co., Inc. vs. Deputy Executive Secretary:"x x x Timber licenses, permits and license agreements are the principal instruments by which the State regulates the utilization and disposition of forest resources to the end that public welfare is promoted.And it can hardly be gainsaid that they merely evidence a privilege granted by the State to qualified entities, and do not vest in the latter a permanent or irrevocable right to the particular concession area and the forest products therein. They may be validly amended, modified, replaced or rescinded by the Chief Executive when national interests so require.Thus, they are not deemed contracts within the purview of the due process of law clause [SeeSections 3(ee) and 20 of Pres. Decree No. 705, as amended.Also,Tan v. Director of Forestry, G.R. No. L-24548, October 27, 1983, 125 SCRA 302]."

Since timber licenses are not contracts, the non-impairment clause, which reads:"Sec. 10. No law impairing the obligation of contracts shall be passed."

cannot be invoked.28[emphasis supplied]

The Presidential Warranty cannot, in any manner, be construed as a contractual undertaking assuring PICOP of exclusive possession and enjoyment of its concession areas. Such an interpretation would result in the complete abdication by the State in favor of PICOP of the sovereign power to control and supervise the exploration, development and utilization of the natural resources in the area.

In closing, we should lay emphasis on the fact that the reinstatement of Base Metals' MPSA does not automatically result in its approval. Base Metals still has to comply with the requirements outlined in DAO 96-40, including the publication/posting/radio announcement of its mineral agreement application.

IN VIEW OF THE FOREGOING, the instant petition is DENIED. The Decision of the Court of Appeals November 28, 2003 is AFFIRMED. No pronouncement as to costs.

SO ORDERED.

Quisumbing, J., Chairperson, Carpio, Carpio Morales, and Velasco, Jr., JJ.,concur. DENR vs. Yap, G.R. No. 16770