G.R. Nos.

152613 & 152628 November 20, 2009

APEX MINING CO., INC., petitioner,
vs.
SOUTHEAST MINDANAO GOLD MINING CORP., the mines adjudication board, provincial mining regulatory board (PMRB-DAVAO), MONKAYO
INTEGRATED SMALL SCALE MINERS ASSOCIATION, INC., ROSENDO VILLAFLOR, BALITE COMMUNAL PORTAL MINING COOPERATIVE, DAVAO
UNITED MINERS COOPERATIVE, ANTONIO DACUDAO, PUTING-BATO GOLD MINERS COOPERATIVE, ROMEO ALTAMERA, THELMA CATAPANG,
LUIS GALANG, RENATO BASMILLO, FRANCISCO YOBIDO, EDUARDO GLORIA, EDWIN ASION, MACARIO HERNANDEZ, REYNALDO CARUBIO,
ROBERTO BUNIALES, RUDY ESPORTONO, ROMEO CASTILLO, JOSE REA, GIL GANADO, PRIMITIVA LICAYAN, LETICIA ALQUEZA and JOEL
BRILLANTES Management Mining Corporation, Respondents.
x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 152619-20
BALITE COMMUNAL PORTAL MINING COOPERATIVE, petitioner,
vs.
SOUTHEAST MINDANAO GOLD MINING CORP., APEX MINING CO., INC., The Mines Adjudication Board, Provincial Mining Regulatory Board (PMRB-
DAVAO), MONKAYO INTEGRATED SMALL SCALE MINERS ASSOCIATION, INC., ROSENDO VILLAFLOR, DAVAO UNITED MINERS COOPERATIVE,
ANTONIO DACUDAO, PUTING-BATO GOLD MINERS COOPERATIVE, ROMEO ALTAMERA, THELMA CATAPANG, LUIS GALANG, RENATO
BASMILLO, FRANCISCO YOBIDO, EDUARDO GLORIA, EDWIN ASION, MACARIO HERNANDEZ, REYNALDO CARUBIO, ROBERTO BUNIALES, RUDY
ESPORTONO, ROMEO CASTILLO, JOSE REA, GIL GANADO, PRIMITIVA LICAYAN, LETICIA ALQUEZA and JOEL BRILLANTES Management Mining
Corporation, Respondents.
x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 152870-71
THE MINES ADJUDICATION BOARD AND ITS MEMBERS, THE HON. VICTOR O. RAMOS (Chairman), UNDERSECRETARY VIRGILIO MARCELO
(Member) and DIRECTOR HORACIO RAMOS (Member),petitioners,
vs.
SOUTHEAST MINDANAO GOLD MINING CORPORATION, Respondent.
RESOLUTION
CHICO-NAZARIO, J.:
This resolves the motion for reconsideration dated 12 July 2006, filed by Southeast Mindanao Gold Mining Corporation (SEM), of this Courts Decision dated 23
June 2006 (Assailed Decision). The Assailed Decision held that the assignment of Exploration Permit (EP) 133 in favor of SEM violated one of the conditions
stipulated in the permit, i.e., that the same shall be for the exclusive use and benefit of Marcopper Mining Corporation (MMC) or its duly authorized agents. Since
SEM did not claim or submit evidence that it was a designated agent of MMC, the latter cannot be considered as an agent of the former that can use EP 133 and
benefit from it. It also ruled that the transfer of EP 133 violated Presidential Decree No. 463, which requires that the assignment of a mining right be made with
the prior approval of the Secretary of the Department of Environment and Natural Resources (DENR). Moreover, the Assailed Decision pointed out that EP 133
expired by non-renewal since it was not renewed before or after its expiration.
The Assailed Decision likewise upheld the validity of Proclamation No. 297 absent any question against its validity. In view of this, and considering that under
Section 5 of Republic Act No. 7942, otherwise known as the "Mining Act of 1995," mining operations in mineral reservations may be undertaken directly by the
State or through a contractor, the Court deemed the issue of ownership of priority right over the contested Diwalwal Gold Rush Area as having been overtaken
by the said proclamation. Thus, it was held in the Assailed Decision that it is now within the prerogative of the Executive Department to undertake directly the
mining operations of the disputed area or to award the operations to private entities including petitioners Apex and Balite, subject to applicable laws, rules and
regulations, and provided that these private entities are qualified.
SEM also filed a Motion for Referral of Case to the Court En Banc and for Oral Arguments dated 22 August 2006.
Apex, for its part, filed a Motion for Clarification of the Assailed Decision, praying that the Court elucidate on the Decisions pronouncement that "mining
operations, are now, therefore within the full control of the State through the executive branch." Moreover, Apex asks this Court to order the Mines and
Geosciences Board (MGB) to accept its application for an exploration permit.
In its Manifestation and Motion dated 28 July 2006, Balite echoes the same concern as that of Apex on the actual takeover by the State of the mining industry in
the disputed area to the exclusion of the private sector. In addition, Balite prays for this Court to direct MGB to accept its application for an exploration permit.
Camilo Banad, et al., likewise filed a motion for reconsideration and prayed that the disputed area be awarded to them.
In the Resolution dated 15 April 2008, the Court En Banc resolved to accept the instant cases. The Court, in a resolution dated 29 April 2008, resolved to set the
cases for Oral Argument on 1 July 2008.
During the Oral Argument, the Court identified the following principal issues to be discussed by the parties:
1. Whether the transfer or assignment of Exploration Permit (EP) 133 by MMC to SEM was validly made without violating any of the terms and conditions
set forth in Presidential Decree No. 463 and EP 133 itself.
2. Whether Southeast Mindanao Mining Corp. acquired a vested right over the disputed area, which constitutes a property right protected by the
Constitution.
3. Whether the assailed Decision dated 23 June 2006 of the Third Division in this case is contrary to and overturns the earlier Decision of this Court in
Apex v. Garcia (G.R. No. 92605, 16 July 1991, 199 SCRA 278).
4. Whether the issuance of Proclamation No. 297 declaring the disputed area as mineral reservation outweighs the claims of SEM, Apex Mining Co. Inc.
and Balite Communal Portal Mining Cooperative over the Diwalwal Gold Rush Area.
5. Whether the issue of the legality/constitutionality of Proclamation No. 297 was belatedly raised.
6. Assuming that the legality/constitutionality of Proclamation No. 297 was timely raised, whether said proclamation violates any of the following:
a. Article XII, Section 4 of the Constitution;
b. Section 1 of Republic Act No. 3092;
c. Section 14 of the Administrative Code of 1987;
d. Section 5(a) of Republic Act No. 7586;
e. Section 4(a) of Republic Act No. 6657; and
f. Section 2, Subsection 2.1.2 of Executive Order No. 318 dated 9 June 2004.
After hearing the arguments of the parties, the Court required them to submit their respective memoranda. Memoranda were accordingly filed by SEM, Apex,
Balite and Mines Adjudication Board (MAB).
We shall resolve the second issue before dwelling on the first, third and the rest of the issues.
MMC or SEM Did Not Have Vested Rights Over the Diwalwal Gold Rush Area
Petitioner SEM vigorously argues that Apex Mining Co., Inc. v. Garcia1 vested in MMC mining rights over the disputed area. It claims that the mining rights that
MMC acquired under the said case were the ones assigned to SEM, and not the right to explore under MMCs EP 133. It insists that mining rights, once
obtained, continue to subsist regardless of the validity of the exploration permit; thus, mining rights are independent of the exploration permit and therefore do
not expire with the permit. SEM insists that a mining right is a vested property right that not even the government can take away. To support this thesis, SEM
cites this Courts ruling in McDaniel v. Apacible and Cuisia2 and in Gold Creek Mining Corporation v. Rodriguez,3 which were decided in 1922 and 1938,
respectively.
McDaniel and Gold Creek Mining Corporation are not in point.
In 1916, McDaniel, petitioner therein, located minerals, i.e., petroleum, on an unoccupied public land and registered his mineral claims with the office of the
mining recorder pursuant to the Philippine Bill of 1902, where a mining claim locator, soon after locating the mine, enjoyed possessory rights with respect to such
mining claim with or without a patent therefor. In that case, the Agriculture Secretary, by virtue of Act No. 2932, approved in 1920, which provides that "all public
lands may be leased by the then Secretary of Agriculture and Natural Resources," was about to grant the application for lease of therein respondent, overlapping
the mining claims of the subject petitioner. Petitioner argued that, being a valid locator, he had vested right over the public land where his mining claims were
located. There, the Court ruled that the mining claim perfected under the Philippine Bill of 1902, is "property in the highest sense of that term, which may be sold
and conveyed, and will pass by descent, and is not therefore subject to the disposal of the Government." The Court then declared that since petitioner had
already perfected his mining claim under the Philippine Bill of 1902, a subsequent statute, i.e., Act No. 2932, could not operate to deprive him of his already
perfected mining claim, without violating his property right.
Gold Creek Mining reiterated the ruling in McDaniel that a perfected mining claim under the Philippine Bill of 1902 no longer formed part of the public domain;
hence, such mining claim does not come within the prohibition against the alienation of natural resources under Section 1, Article XII of the 1935 Constitution.
Gleaned from the ruling on the foregoing cases is that for this law to apply, it must be established that the mining claim must have been perfected when the
Philippine Bill of 1902 was still in force and effect. This is so because, unlike the subsequent laws that prohibit the alienation of mining lands, the Philippine Bill of
1902 sanctioned the alienation of mining lands to private individuals. The Philippine Bill of 1902 contained provisions for, among many other things, the open and
free exploration, occupation and purchase of mineral deposits and the land where they may be found. It declared "all valuable mineral deposits in public lands in
the Philippine Islands, both surveyed and unsurveyed x x x to be free and open to exploration, occupation, and purchase, and the land in which they are found to
occupation and purchase, by citizens of the United States, or of said Islands x x x."4 Pursuant to this law, the holder of the mineral claim is entitled to all the
minerals that may lie within his claim, provided he does three acts: First, he enters the mining land and locates a plot of ground measuring, where possible, but
not exceeding, one thousand feet in length by one thousand feet in breadth, in as nearly a rectangular form as possible.5Second, the mining locator has to record
the mineral claim in the mining recorder within thirty (30) days after the location thereof.6 Lastly, he must comply with the annual actual work
requirement.7 Complete mining rights, namely, the rights to explore, develop and utilize, are acquired by a mining locator by simply following the foregoing
requirements. 1avvphi1

With the effectivity of the 1935 Constitution, where the regalian doctrine was adopted, it was declared that all natural resources of the Philippines, including
mineral lands and minerals, were property belonging to the State.8Excluded, however, from the property of public domain were the mineral lands and minerals
that were located and perfected by virtue of the Philippine Bill of 1902, since they were already considered private properties of the locators.9
Commonwealth Act No. 137 or the Mining Act of 1936, which expressly adopted the regalian doctrine following the provision of the 1935 Constitution, also
proscribed the alienation of mining lands and granted only lease rights to mining claimants, who were prohibited from purchasing the mining claim itself.
When Presidential Decree No. 463, which revised Commonwealth Act No. 137, was in force in 1974, it likewise recognized the regalian doctrine embodied in the
1973 Constitution. It declared that all mineral deposits and public and private lands belonged to the state while, nonetheless, recognizing mineral rights that had
already been existing under the Philippine Bill of 1902 as being beyond the purview of the regalian doctrine.10 The possessory rights of mining claim holders
under the Philippine Bill of 1902 remained intact and effective, and such rights were recognized as property rights that the holders could convey or pass by
descent.11
In the instant cases, SEM does not aver or prove that its mining rights had been perfected and completed when the Philippine Bill of 1902 was still the operative
law. Surely, it is impossible for SEM to successfully assert that it acquired mining rights over the disputed area in accordance with the same bill, since it was only
in 1984 that MMC, SEMs predecessor-in-interest, filed its declaration of locations and its prospecting permit application in compliance with Presidential Decree
No. 463. It was on 1 July 1985 and 10 March 1986 that a Prospecting Permit and EP 133, respectively, were issued to MMC. Considering these facts, there is no
possibility that MMC or SEM could have acquired a perfected mining claim under the auspices of the Philippine Bill of 1902. Whatever mining rights MMC had
that it invalidly transferred to SEM cannot, by any stretch of imagination, be considered "mining rights" as contemplated under the Philippine Bill of 1902 and
immortalized in McDaniel and Gold Creek Mining.
SEM likens EP 133 with a building permit. SEM likewise equates its supposed rights attached to the exploration permit with the rights that a private property land
owner has to said landholding. This analogy has no basis in law. As earlier discussed, under the 1935, 1973 and 1987 Constitutions, national wealth, such as
mineral resources, are owned by the State and not by their discoverer. The discoverer or locator can only develop and utilize said minerals for his own benefit if
he has complied with all the requirements set forth by applicable laws and if the State has conferred on him such right through permits, concessions or
agreements. In other words, without the imprimatur of the State, any mining aspirant does not have any definitive right over the mineral land because, unlike a
private landholding, mineral land is owned by the State, and the same cannot be alienated to any private person as explicitly stated in Section 2, Article XIV of
the 1987 Constitution:
All lands of public domain, waters, minerals x x x and all other natural resources are owned by the State. With the exception of agricultural lands, all other natural
resources shall not be alienated. (Emphases supplied.)
Further, a closer scrutiny of the deed of assignment in favor of SEM reveals that MMC assigned to the former the rights and interests it had in EP 133, thus:
1. That for ONE PESO (P1.00) and other valuable consideration received by the ASSIGNOR from the ASSIGNEE, the ASSIGNOR hereby ASSIGNS,
TRANSFERS and CONVEYS unto the ASSIGNEE whatever rights or interest the ASSIGNOR may have in the area situated in Monkayo, Davao del Norte and
Cateel, Davao Oriental, identified as Exploration Permit No. 133 and Application for a Permit to Prospect in Bunawan, Agusan del Sur respectively. (Emphasis
supplied.)
It is evident that what MMC had over the disputed area during the assignment was an exploration permit. Clearly, the right that SEM acquired was limited to
exploration, only because MMC was a mere holder of an exploration permit. As previously explained, SEM did not acquire the rights inherent in the permit, as
the assignment by MMC to SEM was done in violation of the condition stipulated in the permit, and the assignment was effected without the approval of the
proper authority in contravention of the provision of the mining law governing at that time. In addition, the permit expired on 6 July 1994. It is, therefore, quite
clear that SEM has no right over the area.
Even assuming arguendo that SEM obtained the rights attached in EP 133, said rights cannot be considered as property rights protected under the fundamental
law.
An exploration permit does not automatically ripen into a right to extract and utilize the minerals; much less does it develop into a vested right. The holder of an
exploration permit only has the right to conduct exploration works on the area awarded. Presidential Decree No. 463 defined exploration as "the examination and
investigation of lands supposed to contain valuable minerals, by drilling, trenching, shaft sinking, tunneling, test pitting and other means, for the purpose of
probing the presence of mineral deposits and the extent thereof." Exploration does not include development and exploitation of the minerals found. Development
is defined by the same statute as the steps necessarily taken to reach an ore body or mineral deposit so that it can be mined, whereas exploitation is defined as
"the extraction and utilization of mineral deposits." An exploration permit is nothing more than a mere right accorded to its holder to be given priority in the
governments consideration in the granting of the right to develop and utilize the minerals over the area. An exploration permit is merely inchoate, in that the
holder still has to comply with the terms and conditions embodied in the permit. This is manifest in the language of Presidential Decree No. 463, thus:
Sec. 8. x x x The right to exploit 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 persons or corporations who undertook prospecting and exploration of said area shall be given priority.
In La Bugal-Blaan Tribal Association, Inc. v. Ramos,12 this Court emphasized:
Pursuant to Section 20 of RA 7942, an exploration permit merely grants to a qualified person the right to conduct exploration for all minerals in specified areas.
Such a permit does not amount to an authorization to extract and carry off the mineral resources that may be discovered. x x x.
Pursuant to Section 24 of RA 7942, an exploration permit grantee who determines the commercial viability of a mining area may, within the term of the permit,
file with the MGB a declaration of mining project feasibility accompanied by a work program for development. The approval of the mining project feasibility and
compliance with other requirements of RA 7942 vests in the grantee the exclusive right to an MPSA or any other mineral agreement, or to an FTAA.
(Underscoring ours.)
The non-acquisition by MMC or SEM of any vested right over the disputed area is supported by this Courts ruling in Southeast Mindanao Gold Mining
Corporation v. Balite Portal Mining Cooperative13 :
Clearly then, the Apex Mining case did not invest petitioner with any definite right to the Diwalwal mines which it could now set up against respondent BCMC and
other mining groups.
Incidentally, it must likewise be pointed out that under no circumstances may petitioners rights under EP No. 133 be regarded as total and absolute. As correctly
held by the Court of Appeals in its challenged decision, EP No. 133 merely evidences a privilege granted by the State, which may be amended, modified or
rescinded when the national interest so requires. x x x. (Underscoring supplied.)
Unfortunately, SEM cannot be given priority to develop and exploit the area covered by EP 133 because, as discussed in the assailed Decision, EP 133 expired
by non-renewal on 6 July 1994. Also, as already mentioned, the transfer of the said permit to SEM was without legal effect because it was done in contravention
of Presidential Decree No. 463 which requires prior approval from the proper authority. Simply told, SEM holds nothing for it to be entitled to conduct mining
activities in the disputed mineral land.
SEM wants to impress on this Court that its alleged mining rights, by virtue of its being a transferee of EP 133, is similar to a Financial and Technical Assistance
Agreement (FTAA) of a foreign contractor, which merits protection by the due process clause of the Constitution. SEM cites La Bugal-Blaan Tribal Association,
Inc. v. Ramos,14 as follows:
To say that an FTAA is just like a mere timber license or permit and does not involve contract or property rights which merit protection by the due process clause
of the Constitution, and may therefore be revoked or cancelled in the blink of an eye, is to adopt a well-nigh confiscatory stance; at the very least, it is downright
dismissive of the property rights of businesspersons and corporate entities that have investments in the mining industry, whose investments, operations and
expenditures do contribute to the general welfare of the people, the coffers of government, and the strength of the economy. x x x.
Again, this argument is not meritorious. SEM did not acquire the rights attached to EP 133, since their transfer was without legal effect. Granting for the sake of
argument that SEM was a valid transferee of the permit, its right is not that of a mining contractor. An exploration permit grantee is vested with the right to
conduct exploration only, while an FTAA or MPSA contractor is authorized to extract and carry off the mineral resources that may be discovered in the area.15 An
exploration permit holder still has to comply with the mining project feasibility and other requirements under the mining law. It has to obtain approval of such
accomplished requirements from the appropriate government agencies. Upon obtaining this approval, the exploration permit holder has to file an application for
an FTAA or an MPSA and have it approved also. Until the MPSA application of SEM is approved, it cannot lawfully claim that it possesses the rights of an MPSA
or FTAA holder, thus:
x x x prior to the issuance of such FTAA or mineral agreement, the exploration permit grantee (or prospective contractor) cannot yet be deemed to have entered
into any contract or agreement with the State x x x.16
But again, SEM is not qualified to apply for an FTAA or any mineral agreement, considering that it is not a holder of a valid exploration permit, since EP 133
expired by non-renewal and the transfer to it of the same permit has no legal value.
More importantly, assuming arguendo that SEM has a valid exploration permit, it cannot assert any mining right over the disputed area, since the State has
taken over the mining operations therein, pursuant to Proclamation No. 297 issued by the President on 25 November 2002. The Court has consistently ruled that
the nature of a natural resource exploration permit is analogous to that of a license. In Republic v. Rosemoor Mining and Development Corporation, this Court
articulated:
Like timber permits, mining exploration permits do not vest in the grantee any permanent or irrevocable right within the purview of the non-impairment of contract
and due process clauses of the Constitution, since the State, under its all-encompassing police power, may alter, modify or amend the same, in accordance with
the demands of the general welfare.17 (Emphasis supplied.)
As a mere license or privilege, an exploration permit can be validly amended by the President of the Republic when national interests suitably necessitate. The
Court instructed thus:
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 the public welfare is promoted. x x x They may be validly amended, modified, replaced or rescinded by the Chief Executive when national interests
so require.18
Recognizing the importance of the countrys natural resources, not only for national economic development, but also for its security and national defense,
Section 5 of Republic Act No. 7942 empowers the President, when the national interest so requires, to establish mineral reservations where mining operations
shall be undertaken directly by the State or through a contractor, viz:
SEC 5. Mineral Reservations. When the national interest so requires, such as when there is a need to preserve strategic raw materials for industries critical to
national development, or certain minerals for scientific, cultural or ecological value, the President may establish mineral reservations upon the recommendation
of the Director through the Secretary. Mining operations in existing mineral reservations and such other reservations as may thereafter be established, shall be
undertaken by the Department or through a contractor x x x. (Emphasis supplied.)
Due to the pressing concerns in the Diwalwal Gold Rush Area brought about by unregulated small to medium-scale mining operations causing ecological, health
and peace and order problems, the President, on 25 November 2002, issued Proclamation No. 297, which declared the area as a mineral reservation and as an
environmentally critical area. This executive fiat was aimed at preventing the further dissipation of the natural environment and rationalizing the mining
operations in the area in order to attain an orderly balance between socio-economic growth and environmental protection. The area being a mineral reservation,
the Executive Department has full control over it pursuant to Section 5 of Republic Act No. 7942. It can either directly undertake the exploration, development
and utilization of the minerals found therein, or it can enter into agreements with qualified entities. Since the Executive Department now has control over the
exploration, development and utilization of the resources in the disputed area, SEMs exploration permit, assuming that it is still valid, has been effectively
withdrawn. The exercise of such power through Proclamation No. 297 is in accord with jura regalia, where the State exercises its sovereign power as owner of
lands of the public domain and the mineral deposits found within. Thus, Article XII, Section 2 of the 1987 Constitution emphasizes:
SEC. 2. All lands of the public domain, water, 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 product-sharing agreements with Filipino citizens, or corporations or associations at least sixty
per centum of whose capital is owned by such citizens. (Emphasis supplied.)
Furthermore, said proclamation cannot be denounced as offensive to the fundamental law because the State is sanctioned to do so in the exercise of its police
power.19 The issues on health and peace and order, as well the decadence of the forest resources brought about by unregulated mining in the area, are matters
of national interest. The declaration of the Chief Executive making the area a mineral reservation, therefore, is sanctioned by Section 5 of Republic Act No. 7942.
The Assignment of EP No. 133 by MMC in Favor of SEM Violated Section 97 of Presidential Decree No. 463 and the Terms and Conditions Set Forth in the
Permit
SEM claims that the approval requirement under Section 97 of Presidential Decree No. 463 is not applicable to this case, because MMC neither applied for nor
was granted a mining lease contract. The said provision states:
SEC. 97. Assignment of Mining Rights. A mining lease contract or any interest therein shall not be transferred, assigned, or subleased without the prior
approval of the Secretary: Provided, that such transfer, assignment or sublease may be made only to a qualified person possessing the resources and capability
to continue the mining operations of the lessee and that the assignor has complied with all the obligations of the lease: Provided, further, That such transfer or
assignment shall be duly registered with the office of the mining recorder concerned. (Emphasis supplied.)
Exploration Permit 133 was issued in favor of MMC on 10 March 1986, when Presidential Decree No. 463 was still the governing law. Presidential Decree No.
463 pertains to the old system of exploration, development and utilization of natural resources through "license, concession or lease."20
Pursuant to this law, a mining lease contract confers on the lessee or his successors the right to extract, to remove, process and utilize the mineral deposits
found on or underneath the surface of his mining claims covered by the lease. The lessee may also enter into a service contract for the exploration, development
and exploitation of the minerals from the lands covered by his lease, to wit:
SEC. 44. A mining lease contract shall grant to the lessee, his heirs, successors, and assigns the right to extract all mineral deposits found on or underneath the
surface of his mining claims covered by the lease, continued vertically downward; to remove, process, and otherwise utilize the mineral deposits for his own
benefit; and to use the lands covered by the lease for the purpose or purposes specified therein x x x That a lessee may on his own or through the Government,
enter into a service contract for the exploration, development and exploitation of his claims and the processing and marketing of the product thereof, subject to
the rules and regulations that shall be promulgated by the Director, with the approval of the Secretary x x x. (Emphases supplied.)
In other words, the lessees interests are not only limited to the extraction or utilization of the minerals in the contract area, but also to include the right to explore
and develop the same. This right to explore the mining claim or the contract area is derived from the exploration permit duly issued by the proper authority. An
exploration permit is, thus, covered by the term "any other interest therein." Section 97 is entitled, "Assignment of Mining Rights." This alone gives a hint that
before mining rights -- namely, the rights to explore, develop and utilize -- are transferred or assigned, prior approval must be obtained from the DENR
Secretary. An exploration permit, thus, cannot be assigned without the imprimatur of the Secretary of the DENR.
It is instructive to note that under Section 13 of Presidential Decree No. 463, the prospecting and exploration of minerals in government reservations, such as
forest reservations, are prohibited, except with the permission of the government agency concerned. It is the government agency concerned that has the
prerogative to conduct prospecting, exploration and exploitation of such reserved lands.21 It is only in instances wherein said government agency, in this case the
Bureau of Mines, cannot undertake said mining operations that qualified persons may be allowed by the government to undertake such operations. PNOC-EDC
v. Veneracion, Jr.22 outlines the five requirements for acquiring mining rights in reserved lands under Presidential Decree No. 463: (1) a prospecting permit from
the agency that has jurisdiction over the land; (2) an exploration permit from the Bureau of Mines and Geo-Sciences (BMGS); (3) if the exploration reveals the
presence of commercial deposit, application to BMGS by the permit holder for the exclusion of the area from the reservation; (4) a grant by the President of the
application to exclude the area from the reservation; and (5) a mining agreement (lease, license or concession) approved by the DENR Secretary.
Here, MMC met the first and second requirements and obtained an exploration permit over the disputed forest reserved land. Although MMC still has to prove to
the government that it is qualified to develop and utilize the subject mineral land, as it has yet to go through the remaining process before it can secure a lease
agreement, nonetheless, it is bound to follow Section 97 of Presidential Decree No. 463. The logic is not hard to discern. If a lease holder, who has already
demonstrated to the government his capacity and qualifications to further develop and utilize the minerals within the contract area, is prohibited from transferring
his mining rights (rights to explore, develop and utilize), with more reason will this proscription apply with extra force to a mere exploration permit holder who is
yet to exhibit his qualifications in conducting mining operations. The rationale for the approval requirement under Section 97 of Presidential Decree No. 463 is
not hard to see. Exploration permits are strictly granted to entities or individuals possessing the resources and capability to undertake mining operations. Mining
industry is a major support of the national economy and the continuous and intensified exploration, development and wise utilization of mining resources is vital
for national development. For this reason, Presidential Decree No. 463 makes it imperative that in awarding mining operations, only persons possessing the
financial resources and technical skill for modern exploratory and development techniques are encouraged to undertake the exploration, development and
utilization of the countrys natural resources. The preamble of Presidential Decree No. 463 provides thus:
WHEREAS, effective and continuous mining operations require considerable outlays of capital and resources, and make it imperative that persons possessing
the financial resources and technical skills for modern exploratory and development techniques be encouraged to undertake the exploration, development and
exploitation of our mineral resources;
The Court has said that a "preamble" is the key to understanding the statute, written to open the minds of the makers to the mischiefs that are to be remedied,
and the purposes that are to be accomplished, by the provisions of the statute.23 As such, when the statute itself is ambiguous and difficult to interpret, the
preamble may be resorted to as a key to understanding the statute.
Indubitably, without the scrutiny by the government agency as to the qualifications of the would-be transferee of an exploration permit, the same may fall into the
hands of non-qualified entities, which would be counter-productive to the development of the mining industry. It cannot be overemphasized that the exploration,
development and utilization of the countrys natural resources are matters vital to the public interest and the general welfare; hence, their regulation must be of
utmost concern to the government, since these natural resources are not only critical to the nations security, but they also ensure the countrys survival as a
viable and sovereign republic.24
The approval requirement of the Secretary of the DENR for the assignment of exploration permits is bolstered by Section 25 of Republic Act No. 7942 (otherwise
known as the Philippine Mining Act of 1995), which provides that:
Sec. 25. Transfer or Assignment. An exploration permit may be transferred or assigned to a qualified person subject to the approval of the Secretary upon the
recommendation of the Director.
SEM further posits that Section 97 of Presidential Decree No. 463, which requires the prior approval of the DENR when there is a transfer of mining rights,
cannot be applied to the assignment of EP 133 executed by MMC in favor of SEM because during the execution of the Deed of Assignment on 16 February
1994, Executive Order No. 27925became the governing statute, inasmuch as the latter abrogated the old mining system -- i.e., license, concession or lease --
which was espoused by the former.
This contention is not well taken. While Presidential Decree No. 463 has already been repealed by Executive Order No. 279, the administrative aspect of the
former law nonetheless remains applicable. Hence, the transfer or assignment of exploration permits still needs the prior approval of the Secretary of the DENR.
As ruled in Miners Association of the Philippines, Inc. v. Factoran, Jr.26 :
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. (Emphasis supplied.)
Not only did the assignment of EP 133 to SEM violate Section 97 of Presidential Decree No. 463, it likewise transgressed one of the conditions stipulated in the
grant of the said permit. The following terms and conditions attached to EP 133 are as follows:27
1. That the permittee shall abide by the work program submitted with the application or statements made later in support thereof, and which shall be
considered as conditions and essential parts of this permit;
2. That permittee shall maintain a complete record of all activities and accounting of all expenditures incurred therein subject to periodic inspection and
verification at reasonable intervals by the Bureau of Mines at the expense of the applicant;
3. That the permittee shall submit to the Director of Mines within 15 days after the end of each calendar quarter a report under oath of a full and complete
statement of the work done in the area covered by the permit;
4. That the term of this permit shall be for two (2) years to be effective from this date, renewable for the same period at the discretion of the Director of
Mines and upon request of the applicant;
5. That the Director of Mines may at any time cancel this permit for violation of its provision or in case of trouble or breach of peace arising in the area
subject hereof by reason of conflicting interests without any responsibility on the part of the government as to expenditures for exploration that might
have been incurred, or as to other damages that might have been suffered by the permittee;
6. That this permit shall be for the exclusive use and benefit of the permittee or his duly authorized agents and shall be used for mineral exploration
purposes only and for no other purpose.
It must be noted that under Section 9028 of Presidential Decree No. 463, which was the applicable statute during the issuance of EP 133, the DENR Secretary,
through the Director of the Bureau of Mines and Geosciences, was charged with carrying out the said law. Also, under Commonwealth Act No. 136, also known
as "An Act Creating the Bureau of Mines," which was approved on 7 November 1936, the Director of Mines had the direct charge of the administration of the
mineral lands and minerals; and of the survey, classification, lease or any other form of concession or disposition thereof under the Mining Act.29 This power of
administration included the power to prescribe terms and conditions in granting exploration permits to qualified entities.
Thus, in the grant of EP 133 in favor of the MMC, the Director of the BMG acted within his power in laying down the terms and conditions attendant thereto.
MMC and SEM did not dispute the reasonableness of said conditions.
Quite conspicuous is the fact that neither MMC nor SEM denied that they were unaware of the terms and conditions attached to EP 133. MMC and SEM did not
present any evidence that they objected to these conditions. Indubitably, MMC wholeheartedly accepted these terms and conditions, which formed part of the
grant of the permit. MMC agreed to abide by these conditions. It must be accentuated that a party to a contract cannot deny its validity, without outrage to ones
sense of justice and fairness, after enjoying its benefits.30 Where parties have entered into a well-defined contractual relationship, it is imperative that they should
honor and adhere to their rights and obligations as stated in their contracts, because obligations arising from these have the force of law between the contracting
parties and should be complied with in good faith.31 Condition Number 6 categorically states that the permit shall be for the exclusive use and benefit of MMC or
its duly authorized agents. While it may be true that SEM, the assignee of EP 133, is a 100% subsidiary corporation of MMC, records are bereft of any evidence
showing that the former is the duly authorized agent of the latter. This Court cannot condone such utter disregard on the part of MMC to honor its obligations
under the permit. Undoubtedly, having violated this condition, the assignment of EP 133 to SEM is void and has no legal effect.
To boot, SEM squandered whatever rights it assumed it had under EP 133. On 6 July 1993, EP 133 was extended for twelve more months or until 6 July 1994.
MMC or SEM, however, never renewed EP 133 either prior to or after its expiration. Thus, EP 133 expired by non-renewal on 6 July 1994. With the expiration of
EP 133 on 6 July 1994, MMC lost any right to the Diwalwal Gold Rush Area.
The Assailed Decision Resolved Facts and Issues That Transpired after the Promulgation of Apex Mining Co., Inc. v. Garcia
SEM asserts that the 23 June 2006 Decision reversed the 16 July 1991 Decision of the Court en banc entitled, "Apex Mining Co., Inc. v. Garcia."32
The assailed Decision DID NOT overturn the 16 July 1991 Decision in Apex Mining Co., Inc. v. Garcia.
It must be pointed out that what Apex Mining Co., Inc. v. Garcia resolved was the issue of which, between Apex and MMC, availed itself of the proper procedure
in acquiring the right to prospect and to explore in the Agusan-Davao-Surigao Forest Reserve. Apex registered its Declarations of Location (DOL) with the then
BMGS, while MMC was granted a permit to prospect by the Bureau of Forest Development (BFD) and was subsequently granted an exploration permit by the
BMGS. Taking into consideration Presidential Decree No. 463, which provides that "mining rights within forest reservation can be acquired by initially applying
for a permit to prospect with the BFD and subsequently for a permit to explore with the BMGS," the Court therein ruled that MMC availed itself of the proper
procedure to validly operate within the forest reserve or reservation.
While it is true that Apex Mining Co., Inc. v. Garcia settled the issue of which between Apex and MMC was legally entitled to explore in the disputed area, such
rights, though, were extinguished by subsequent events that transpired after the decision was promulgated. These subsequent events, which were not attendant
in Apex Mining Co., Inc. v. Garcia33 dated 16 July 1991, are the following:
(1) the expiration of EP 133 by non-renewal on 6 July 1994;
(2) the transfer/assignment of EP 133 to SEM on 16 February 1994 which was done in violation to the condition of EP 133 proscribing its transfer;
(3) the transfer/assignment of EP 133 to SEM is without legal effect for violating PD 463 which mandates that the assignment of mining rights must be
with the prior approval of the Secretary of the DENR.
Moreover, in Southeast Mindanao Gold Mining Corporation v. Balite Portal Mining Cooperative,34 the Court, through Associate Justice Consuelo Ynares-
Santiago (now retired), declared that Apex Mining Co., Inc. v. Garcia did not deal with the issues of the expiration of EP 133 and the validity of the transfer of EP
133 to SEM, viz:
Neither can the Apex Mining case foreclose any question pertaining to the continuing validity of EP No. 133 on grounds which arose after the judgment in said
case was promulgated. While it is true that the Apex Mining case settled the issue of who between Apex and Marcopper validly acquired mining rights over the
disputed area by availing of the proper procedural requisites mandated by law, it certainly did not deal with the question raised by the oppositors in the
Consolidated Mines cases, i.e., whether EP No. 133 had already expired and remained valid subsequent to its transfer by Marcopper to petitioner. (Emphasis
supplied.)
What is more revealing is that in the Resolution dated 26 November 1992, resolving the motion for reconsideration of Apex Mining Co., Inc. v. Garcia, the Court
clarified that the ruling on the said decision was binding only between Apex and MMC and with respect the particular issue raised therein. Facts and issues not
attendant to the said decision, as in these cases, are not settled by the same. A portion of the disposition of the Apex Mining Co., Inc. v. Garcia Resolution dated
26 November 1992 decrees:
x x x The decision rendered in this case is conclusive only between the parties with respect to the particular issue herein raised and under the set of
circumstances herein prevailing. In no case should the decision be considered as a precedent to resolve or settle claims of persons/entities not parties hereto.
Neither is it intended to unsettle rights of persons/entities which have been acquired or which may have accrued upon reliance on laws passed by the
appropriate agencies. (Emphasis supplied.)
The Issue of the Constitutionality of Proclamation Is Raised Belatedly
In its last-ditch effort to salvage its case, SEM contends that Proclamation No. 297, issued by President Gloria Macapagal-Arroyo and declaring the Diwalwal
Gold Rush Area as a mineral reservation, is invalid on the ground that it lacks the concurrence of Congress as mandated by Section 4, Article XII of the
Constitution; Section 1 of Republic Act No. 3092; Section 14 of Executive Order No. 292, otherwise known as the Administrative Code of 1987; Section 5(a) of
Republic Act No. 7586, and Section 4(a) of Republic Act No. 6657.
It is well-settled that when questions of constitutionality are raised, the court can exercise its power of judicial review only if the following requisites are present:
(1) an actual and appropriate case exists; (2) there is a personal and substantial interest of the party raising the constitutional question; (3) the exercise of
judicial review is pleaded at the earliest opportunity; and (4) the constitutional question is the lis mota of the case.
Taking into consideration the foregoing requisites of judicial review, it is readily clear that the third requisite is absent. The general rule is that the question of
constitutionality must be raised at the earliest opportunity, so that if it is not raised in the pleadings, ordinarily it may not be raised at the trial; and if not raised in
the trial court, it will not be considered on appeal.35
In the instant case, it must be pointed out that in the Reply to Respondent SEMs Consolidated Comment filed on 20 May 2003, MAB mentioned Proclamation
No. 297, which was issued on 25 November 2002. This proclamation, according to the MAB, has rendered SEMs claim over the contested area moot, as the
President has already declared the same as a mineral reservation and as an environmentally critical area. SEM did not put to issue the validity of said
proclamation in any of its pleadings despite numerous opportunities to question the same. It was only after the assailed Decision was promulgated -- i.e., in
SEMs Motion for Reconsideration of the questioned Decision filed on 13 July 2006 and its Motion for Referral of the Case to the Court En Banc and for Oral
Arguments filed on 22 August 2006 -- that it assailed the validity of said proclamation.
Certainly, posing the question on the constitutionality of Proclamation No. 297 for the first time in its Motion for Reconsideration is, indeed, too late.36
In fact, this Court, when it rendered the Decision it merely recognized that the questioned proclamation came from a co-equal branch of government, which
entitled it to a strong presumption of constitutionality.37 The presumption of its constitutionality stands inasmuch as the parties in the instant cases did not
question its validity, much less present any evidence to prove that the same is unconstitutional. This is in line with the precept that administrative issuances have
the force and effect of law and that they benefit from the same presumption of validity and constitutionality enjoyed by statutes.38
Proclamation No. 297 Is in Harmony with Article XII, Section 4, of the Constitution
At any rate, even if this Court were to consider the arguments belatedly raised by SEM, said arguments are not meritorious.
SEM asserts that Article XII, Section 4 of the Constitution, bars the President from excluding forest reserves/reservations and proclaiming the same as mineral
reservations, since the power to de-classify them resides in Congress.
Section 4, Article XII of the Constitution reads:
The Congress shall as soon as possible, determine by law the specific limits of forest lands and national parks, marking clearly their boundaries on the ground.
Thereafter, such forest lands and national parks shall be conserved and may not be increased nor diminished, except by law. The Congress shall provide, for
such periods as it may determine, measures to prohibit logging in endangered forests and in watershed areas.
The above-quoted provision says that the area covered by forest lands and national parks may not be expanded or reduced, unless pursuant to a law enacted
by Congress. Clear in the language of the constitutional provision is its prospective tenor, since it speaks in this manner: "Congress shall as soon as possible." It
is only after the specific limits of the forest lands shall have been determined by the legislature will this constitutional restriction apply. SEM does not allege nor
present any evidence that Congress had already enacted a statute determining with specific limits forest lands and national parks. Considering the absence of
such law, Proclamation No. 297 could not have violated Section 4, Article XII of the 1987 Constitution. In PICOP Resources, Inc. v. Base Metals Mineral
Resources Corporation,39 the Court had the occasion to similarly rule in this fashion:
x x x 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.
Section 4, Article XII of the Constitution, addresses the concern of the drafters of the 1987 Constitution about forests and the preservation of national parks. This
was brought about by the drafters awareness and fear of the continuing destruction of this countrys forests.40 In view of this concern, Congress is tasked to fix
by law the specific limits of forest lands and national parks, after which the trees in these areas are to be taken care of.41Hence, these forest lands and national
parks that Congress is to delimit through a law could be changed only by Congress.
In addition, there is nothing in the constitutional provision that prohibits the President from declaring a forest land as an environmentally critical area and from
regulating the mining operations therein by declaring it as a mineral reservation in order to prevent the further degradation of the forest environment and to
resolve the health and peace and order problems that beset the area.
A closer examination of Section 4, Article XII of the Constitution and Proclamation No. 297 reveals that there is nothing contradictory between the two.
Proclamation No. 297, a measure to attain and maintain a rational and orderly balance between socio-economic growth and environmental protection, jibes with
the constitutional policy of preserving and protecting the forest lands from being further devastated by denudation. In other words, the proclamation in question is
in line with Section 4, Article XII of the Constitution, as the former fosters the preservation of the forest environment of the Diwalwal area and is aimed at
preventing the further degradation of the same. These objectives are the very same reasons why the subject constitutional provision is in place.
What is more, jurisprudence has recognized the policy of multiple land use in our laws towards the end that the countrys precious natural resources may be
rationally explored, developed, utilized and conserved.42 It has been held that forest reserves or reservations can at the same time be open to mining operations,
provided a prior written clearance by the government agency having jurisdiction over such reservation is obtained. In other words mineral lands can exist within
forest reservations. These two terms are not anti-thetical. This is made manifest if we read Section 47 of Presidential Decree No. 705 or the Revised Forestry
Code of the Philippines, which provides:
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.
(Emphasis supplied.)
Also, Section 6 of Republic Act No. 7942 or the Mining Act of 1995, states that mining operations in reserved lands other than mineral reservations, such as
forest reserves/reservations, are allowed, viz:
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. (Emphasis supplied.)
Since forest reservations can be made mineral lands where mining operations are conducted, then there is no argument that the disputed land, which lies within
a forest reservation, can be declared as a mineral reservation as well.
Republic Act No. 7942 Otherwise Known as the "Philippine Mining Act of 1995," is the Applicable Law
Determined to rivet its crumbling cause, SEM then argues that Proclamation No. 297 is invalid, as it transgressed the statutes governing the exclusion of areas
already declared as forest reserves, such as Section 1 of Republic Act No. 3092,43 Section 14 of the Administrative Code of 1987, Section 5(a) of Republic Act
No. 7586,44 and Section 4(a) of Republic Act No. 6657.45
Citing Section 1 of Republic Act No. 3092, which provides as follows:
Upon the recommendation of the Director of Forestry, with the approval of the Department Head, the President of the Philippines shall set apart forest reserves
which shall include denuded forest lands from the public lands and he shall by proclamation declare the establishment of such forest reserves and the
boundaries thereof, and thereafter such forest reserves shall not be entered, or otherwise disposed of, but shall remain indefinitely as such for forest uses.
The President of the Philippines may, in like manner upon the recommendation of the Director of Forestry, with the approval of the Department head, by
proclamation, modify the boundaries of any such forest reserve to conform with subsequent precise survey but not to exclude any portion thereof except with the
concurrence of Congress.(Underscoring supplied.)
SEM submits that the foregoing provision is the governing statute on the exclusion of areas already declared as forest reserves. Thus, areas already set aside
by law as forest reserves are no longer within the proclamation powers of the President to modify or set aside for any other purposes such as mineral
reservation.
To bolster its contention that the President cannot disestablish forest reserves into mineral reservations, SEM makes reference to Section 14, Chapter 4, Title I,
Book III of the Administrative Code of 1987, which partly recites:
The President shall have the power to reserve for settlement or public use, and for specific public purposes, any of the lands of the public domain, the use of
which is not otherwise directed by law. The reserved land shall thereafter remain subject to the specific public purpose indicated until otherwise provided by law
or proclamation. (Emphases supplied.)
SEM further contends that Section 7 of Republic Act No. 7586,46 which declares that the disestablishment of a protected area shall be done by Congress, and
Section 4(a) of Republic Act No. 6657,47 which in turn requires a law passed by Congress before any forest reserve can be reclassified, militate against the
validity of Proclamation No. 297.
Proclamation No. 297, declaring a certain portion of land located in Monkayo, Compostela Valley, with an area of 8,100 hectares, more or less, as a mineral
reservation, was issued by the President pursuant to Section 5 of Republic Act No. 7942, also known as the "Philippine Mining Act of 1995."
Proclamation No. 297 did not modify the boundaries of the Agusan-Davao-Surigao Forest Reserve since, as earlier discussed, mineral reservations can exist
within forest reserves because of the multiple land use policy. The metes and bounds of a forest reservation remain intact even if, within the said area, a mineral
land is located and thereafter declared as a mineral reservation.
More to the point, a perusal of Republic Act No. 3092, "An Act to Amend Certain Sections of the Revised Administrative Code of 1917," which was approved on
17 August 1961, and the Administrative Code of 1987, shows that only those public lands declared by the President as reserved pursuant to these two statutes
are to remain subject to the specific purpose. The tenor of the cited provisions, namely: "the President of the Philippines shall set apart forest reserves" and "the
reserved land shall thereafter remain," speaks of future public reservations to be declared, pursuant to these two statutes. These provisions do not apply to
forest reservations earlier declared as such, as in this case, which was proclaimed way back on 27 February 1931, by Governor General Dwight F. Davis under
Proclamation No. 369.
Over and above that, Section 5 of Republic Act No. 7942 authorizes the President to establish mineral reservations, to wit:
Sec. 5. Mineral Reservations. - When the national interest so requires, such as when there is a need to preserve strategic raw materials for industries critical to
national development, or certain minerals for scientific, cultural or ecological value, the President may establish mineral reservations upon the recommendation
of the Director through the Secretary. Mining operations in existing mineral reservations and such other reservations as may thereafter be established, shall be
undertaken by the Department or through a contractor x x x. (Emphasis supplied.)
It is a rudimentary principle in legal hermeneutics that where there are two acts or provisions, one of which is special and particular and certainly involves the
matter in question, the other general, which, if standing alone, would include the matter and thus conflict with the special act or provision, the special act must as
intended be taken as constituting an exception to the general act or provision, especially when such general and special acts or provisions are
contemporaneous, as the Legislature is not to be presumed to have intended a conflict.
Hence, it has become an established rule of statutory construction that where one statute deals with a subject in general terms, and another deals with a part of
the same subject in a more detailed way, the two should be harmonized if possible; but if there is any conflict, the latter shall prevail regardless of whether it was
passed prior to the general statute. Or where two statutes are of contrary tenor or of different dates but are of equal theoretical application to a particular case,
the one specially designed therefor should prevail over the other.
It must be observed that Republic Act No. 3092, "An Act to Amend Certain Sections of the Revised Administrative Code of 1917," and the Administrative Code of
1987, are general laws. Section 1 of Republic Act No. 3092 and Section 14 of the Administrative Code of 1987 require the concurrence of Congress before any
portion of a forest reserve can be validly excluded therefrom. These provisions are broad since they deal with all kinds of exclusion or reclassification relative to
forest reserves, i.e., forest reserve areas can be transformed into all kinds of public purposes, not only the establishment of a mineral reservation. Section 5 of
Republic Act No. 7942 is a special provision, as it specifically treats of the establishment of mineral reservations only. Said provision grants the President the
power to proclaim a mineral land as a mineral reservation, regardless of whether such land is also an existing forest reservation.
Sec. 5(a) of Republic Act No. 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 Philippines proclaimed, designated or set aside, pursuant to a law, presidential decree, presidential proclamation or executive order
as national 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.
Glaring in the foregoing enumeration of areas comprising the initial component of the NIPAS System under Republic Act No. 7586 is the absence of forest
reserves. Only protected areas enumerated under said provision cannot be modified. Since the subject matter of Proclamation No. 297 is a forest reservation
proclaimed as a mineral reserve, Republic Act No. 7586 cannot possibly be made applicable. Neither can Proclamation No. 297 possibly violate said law.
Similarly, Section 4(a) of Republic Act No. 6657 cannot be made applicable to the instant case.
Section 4(a) of Republic Act No. 6657 reads:
All alienable and disposable lands of the public domain devoted to or suitable for agriculture. No reclassification of forest or mineral lands to agricultural lands
shall be undertaken after the approval of this Act until Congress, taking into account ecological, developmental and equity considerations, shall have determined
by law, the specific limits of the public domain. (Underscoring supplied.)
Section 4(a) of Republic Act No. 6657 prohibits the reclassification of forest or mineral lands into agricultural lands until Congress shall have determined by law
the specific limits of the public domain. A cursory reading of this provision will readily show that the same is not relevant to the instant controversy, as there has
been no reclassification of a forest or mineral land into an agricultural land.
Furthermore, the settled rule of statutory construction is that if two or more laws of different dates and of contrary tenors are of equal theoretical application to a
particular case, the statute of later date must prevail being a later expression of legislative will.48
In the case at bar, there is no question that Republic Act No. 7942 was signed into law later than Republic Act No. 3092, the Administrative Code of
1987,49 Republic Act No. 7586 and Republic Act No. 6657. Applying the cited principle, the provisions of Republic Act No. 3092, the Administrative Code of
1987, Republic Act No. 7586 and Republic Act No. 6657 cited by SEM must yield to Section 5 of Republic Act No. 7942.
Camilo Banad, et al., Cannot Seek Relief from This Court
Camilo Banad and his group admit that they are members of the Balite Cooperative. They, however, claim that they are distinct from Balite and move that this
Court recognize them as prior mining locators.
Unfortunately for them, this Court cannot grant any relief they seek. Records reveal that although they were parties to the instant cases before the Court of
Appeals, they did not file a petition for review before this Court to contest the decision of the appellate court. The only petitioners in the instant cases are the
MAB, SEM, Balite and Apex. Consequently, having no personality in the instant cases, they cannot seek any relief from this Court.
Apexs Motion for Clarification and Balites Manifestation and Motion
In its Motion for Clarification, Apex desires that the Court elucidate the assailed Decisions pronouncement that "mining operations, are now, therefore within the
full control of the State through the executive branch" and place the said pronouncement in the proper perspective as the declaration in La Bugal-BLaan, which
states that
The concept of control adopted in Section 2 of Article XII must be taken to mean less than dictatorial, all-encompassing control; but nevertheless sufficient to
give the State the power to direct, restrain, regulate and govern the affairs of the extractive enterprise.50
Apex states that the subject portion of the assailed Decision could send a chilling effect to potential investors in the mining industry, who may be of the
impression that the State has taken over the mining industry, not as regulator but as an operator. It is of the opinion that the State cannot directly undertake
mining operations.
Moreover, Apex is apprehensive of the following portion in the questioned Decision "The State can also opt to award mining operations in the mineral
reservation to private entities including petitioner Apex and Balite, if it wishes." It avers that the phrase "if it wishes" may whimsically be interpreted to mean a
blanket authority of the administrative authority to reject the formers application for an exploration permit even though it complies with the prescribed policies,
rules and regulations.1 a vv p h i 1

Apex likewise asks this Court to order the MGB to accept its application for an exploration permit.
Balite echoes the same concern as that of Apex on the actual take-over by the State of the mining industry in the disputed area to the exclusion of the private
sector. In addition, Balite prays that this Court direct MGB to accept Balites application for an exploration permit.
Contrary to the contention of Apex and Balite, the fourth paragraph of Section 2, Article XII of the Constitution and Section 5 of Republic Act No. 7942 sanctions
the State, through the executive department, to undertake mining operations directly, as an operator and not as a mere regulator of mineral undertakings. This is
made clearer by the fourth paragraph of Section 2, Article XII of the 1987 Constitution, which provides in part:
SEC. 2. x x x 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 sixty per centum of whose capital is owned by such citizens. x x x. (Emphasis supplied.)
Also, Section 5 of Republic Act No. 7942 states that the mining operations in mineral reservations shall be undertaken by the Department of Environment and
Natural Resources or a contractor, to wit:
SEC. 5. Mineral Reservations. When the national interest so requires, such as when there is a need to preserve strategic raw materials for industries critical to
national development, or certain minerals for scientific, cultural or ecological value, the President may establish mineral reservations upon the recommendation
of the Director through the Secretary. Mining operations in existing mineral reservations and such other reservations as may thereafter be established, shall be
undertaken by the Department or through a contractor x x x. (Emphasis supplied.)
Undoubtedly, the Constitution, as well as Republic Act No. 7942, allows the executive department to undertake mining operations. Besides, La Bugal-BLaan,
cited by Apex, did not refer to the fourth sentence of Section 2, Article XII of the Constitution, but to the third sentence of the said provision, which states:
SEC. 2. x x x The exploration, development, and utilization of natural resources shall be under the full control and supervision of the State. x x x.
Pursuant to Section 5 of Republic Act No. 7942, the executive department has the option to undertake directly the mining operations in the Diwalwal Gold Rush
Area or to award mining operations therein to private entities. The phrase "if it wishes" must be understood within the context of this provision. Hence, the Court
cannot dictate this co-equal branch to choose which of the two options to select. It is the sole prerogative of the executive department to undertake directly or to
award the mining operations of the contested area.
Even assuming that the proper authority may decide to award the mining operations of the disputed area, this Court cannot arrogate unto itself the task of
determining who, among the applicants, is qualified. It is the duty of the appropriate administrative body to determine the qualifications of the applicants. It is only
when this administrative body whimsically denies the applications of qualified applicants that the Court may interfere. But until then, the Court has no power to
direct said administrative body to accept the application of any qualified applicant.
In view of this, the Court cannot grant the prayer of Apex and Balite asking the Court to direct the MGB to accept their applications pending before the MGB.
SEMs Manifestation and Motion dated 25 January 2007
SEM wants to emphasize that its predecessor-in-interest, Marcopper or MMC, complied with the mandatory exploration work program, required under EP 133,
by attaching therewith quarterly reports on exploration work from 20 June 1986 to March 1994.
It must be observed that this is the very first time at this very late stage that SEM has presented the quarterly exploration reports. From the early phase of this
controversy, SEM did not disprove the arguments of the other parties that Marcopper violated the terms under EP 133, among other violations, by not complying
with the mandatory exploration work program. Neither did it present evidence for the appreciation of the lower tribunals. Hence, the non-compliance with the
mandatory exploration work program was not made an issue in any stage of the proceedings. The rule is that an issue that was not raised in the lower court or
tribunal cannot be raised for the first time on appeal, as this would violate the basic rules of fair play, justice and due process.51 Thus, this Court cannot take
cognizance of the issue of whether or not MMC complied with the mandatory work program.
In sum, this Court finds:
1. The assailed Decision did not overturn the 16 July 1991 Decision in Apex Mining Co., Inc. v. Garcia. The former was decided on facts and issues that
were not attendant in the latter, such as the expiration of EP 133, the violation of the condition embodied in EP 133 prohibiting its assignment, and the
unauthorized and invalid assignment of EP 133 by MMC to SEM, since this assignment was effected without the approval of the Secretary of DENR;
2. SEM did not acquire vested right over the disputed area because its supposed right was extinguished by the expiration of its exploration permit and by
its violation of the condition prohibiting the assignment of EP 133 by MMC to SEM. In addition, even assuming that SEM has a valid exploration permit,
such is a mere license that can be withdrawn by the State. In fact, the same has been withdrawn by the issuance of Proclamation No. 297, which places
the disputed area under the full control of the State through the Executive Department;
3. The approval requirement under Section 97 of Presidential Decree No. 463 applies to the assignment of EP 133 by MMC to SEM, since the
exploration permit is an interest in a mining lease contract;
4. The issue of the constitutionality and the legality of Proclamation No. 297 was raised belatedly, as SEM questions the same for the first time in its
Motion for Reconsideration. Even if the issue were to be entertained, the said proclamation is found to be in harmony with the Constitution and other
existing statutes;
5. The motion for reconsideration of Camilo Banad, et al. cannot be passed upon because they are not parties to the instant cases;
6. The prayers of Apex and Balite asking the Court to direct the MGB to accept their applications for exploration permits cannot be granted, since it is the
Executive Department that has the prerogative to accept such applications, if ever it decides to award the mining operations in the disputed area to a
private entity;
7. The Court cannot pass upon the issue of whether or not MMC complied with the mandatory exploration work program, as such was a non-issue and
was not raised before the Court of Appeals and the lower tribunals.
WHEREFORE, premises considered, the Court holds:
1. The Motions for Reconsideration filed by Camilo Banad, et al. and Southeast Mindanao Gold Mining Corporation are DENIED for lack of merit;
2. The Motion for Clarification of Apex Mining Co., Inc. and the Manifestation and Motion of the Balite Communal Portal Mining Cooperative, insofar as
these motions/manifestation ask the Court to direct the Mines and Geo-Sciences Bureau to accept their respective applications for exploration permits,
are DENIED;
3. The Manifestation and Urgent Motion dated 25 January 2007 of Southeast Mindanao Gold Mining Corporation is DENIED.
4. The State, through the Executive Department, should it so desire, may now award mining operations in the disputed area to any qualified entities it
may determine. The Mines and Geosciences Bureau may process exploration permits pending before it, taking into consideration the applicable mining
laws, rules and regulations relative thereto.
SO ORDERED.
BENGUET CORPORATION, G.R. No. 163101
Petitioner,
Present:

- versus - QUISUMBING, J., Chairperson,

CARPIO,
CARPIO MORALES,
TINGA, and
DEPARTMENT OF ENVIRONMENT VELASCO, JR., JJ.
AND NATURAL RESOURCES
-MINES ADJUDICATION BOARD
and J.G. REALTY AND MINING Promulgated:
CORPORATION,
Respondents. February 13, 2008
x-----------------------------------------------------------------------------------------x

DECISION

VELASCO, JR., J.:

The instant petition under Rule 65 of the Rules of Court seeks the annulment of the December 2, 2002 Decision [1] and March
17, 2004 Resolution[2] of the Department of Environment and Natural Resources-Mining Adjudication Board (DENR-MAB) in
MAB Case No. 0124-01 (Mines Administrative Case No. R-M-2000-01) entitled Benguet Corporation (Benguet) v. J.G. Realty and
Mining Corporation (J.G. Realty). The December 2, 2002 Decision upheld the March 19, 2001 Decision[3] of the MAB Panel of
Arbitrators (POA) which canceled the Royalty Agreement with Option to Purchase (RAWOP) dated June 1, 1987 [4] between
Benguet and J.G. Realty, and excluded Benguet from the joint Mineral Production Sharing Agreement (MPSA) application over four
mining claims. The March 17, 2004 Resolution denied Benguets Motion for Reconsideration.

The Facts
 On June 1, 1987, Benguet and J.G. Realty entered into a RAWOP, wherein J.G. Realty was acknowledged as the owner of
four mining claims respectively named as Bonito-I, Bonito-II, Bonito-III, and Bonito-IV, with a total area of 288.8656 hectares,
situated in Barangay Luklukam, Sitio Bagong Bayan, Municipality of Jose Panganiban, Camarines Norte. The parties also executed
a Supplemental Agreement[5] dated June 1, 1987. The mining claims were covered by MPSA Application No. APSA-V-0009 jointly
filed by J.G. Realty as claimowner and Benguet as operator.

In the RAWOP, Benguet obligated itself to perfect the rights to the mining claims and/or otherwise acquire the mining rights
to the mineral claims. Within 24 months from the execution of the RAWOP, Benguet should also cause the examination of the
mining claims for the purpose of determining whether or not they are worth developing with reasonable probability of profitable
production. Benguet undertook also to furnish J.G. Realty with a report on the examination, within a reasonable time after the
completion of the examination. Moreover, also within the examination period, Benguet shall conduct all necessary exploration in
accordance with a prepared exploration program. If it chooses to do so and before the expiration of the examination period, Benguet
may undertake to develop the mining claims upon written notice to J.G. Realty. Benguet must then place the mining claims into
commercial productive stage within 24 months from the written notice.[6] It is also provided in the RAWOP that if the mining claims
were placed in commercial production by Benguet, J.G. Realty should be entitled to a royalty of five percent (5%) of net realizable
value, and to royalty for any production done by Benguet whether during the examination or development periods.

Thus, on August 9, 1989, the Executive Vice-President of Benguet, Antonio N. Tachuling, issued a letter informing J.G.
Realty of its intention to develop the mining claims. However, on February 9, 1999, J.G. Realty, through its President, Johnny L.
Tan, then sent a letter to the President of Benguet informing the latter that it was terminating the RAWOP on the following grounds:

a. The fact that your company has failed to perform the obligations set forth in the RAWOP, i.e., to undertake
development works within 2 years from the execution of the Agreement;

b. Violation of the Contract by allowing high graders to operate on our claim.

c. No stipulation was provided with respect to the term limit of the RAWOP.

d. Non-payment of the royalties thereon as provided in the RAWOP.[7]

 In response, Benguets Manager for Legal Services, Reynaldo P. Mendoza, wrote J.G. Realty a letter dated March 8,
[8]
1999, therein alleging that Benguet complied with its obligations under the RAWOP by investing PhP 42.4 million to rehabilitate
the mines, and that the commercial operation was hampered by the non-issuance of a Mines Temporary Permit by the Mines and
Geosciences Bureau (MGB) which must be considered as force majeure, entitling Benguet to an extension of time to prosecute such
permit. Benguet further claimed that the high graders mentioned by J.G. Realty were already operating prior to Benguets taking
over of the premises, and that J.G. Realty had the obligation of ejecting such small scale miners. Benguet also alleged that the nature
of the mining business made it difficult to specify a time limit for the RAWOP. Benguet then argued that the royalties due to J.G.
Realty were in fact in its office and ready to be picked up at any time. It appeared that, previously, the practice by J.G. Realty was to
pick-up checks from Benguet representing such royalties. However, starting August 1994, J.G. Realty allegedly refused to collect
such checks from Benguet. Thus, Benguet posited that there was no valid ground for the termination of the RAWOP. It also
reminded J.G. Realty that it should submit the disagreement to arbitration rather than unilaterally terminating the RAWOP.

On June 7, 2000, J.G. Realty filed a Petition for Declaration of Nullity/Cancellation of the RAWOP [9] with the Legaspi City
POA, Region V, docketed as DENR Case No. 2000-01 and entitled J.G. Realty v. Benguet.

On March 19, 2001, the POA issued a Decision,[10] dwelling upon the issues of (1) whether the arbitrators had jurisdiction over
the case; and (2) whether Benguet violated the RAWOP justifying the unilateral cancellation of the RAWOP by J.G. Realty. The
dispositive portion stated:

WHEREFORE, premises considered, the June 01, 1987 [RAWOP] and its Supplemental Agreement is hereby
declared cancelled and without effect. BENGUET is hereby excluded from the joint MPSA Application over the mineral
claims denominated as BONITO-I, BONITO-II, BONITO-III and BONITO-IV.

SO ORDERED.

Therefrom, Benguet filed a Notice of Appeal[11] with the MAB on April 23, 2001, docketed as Mines Administrative Case No.
R-M-2000-01. Thereafter, the MAB issued the assailed December 2, 2002 Decision. Benguet then filed a Motion for
Reconsideration of the assailed Decision which was denied in the March 17, 2004 Resolution of the MAB. Hence, Benguet filed the
instant petition.
 The Issues

1. There was serious and palpable error when the Honorable Board failed to rule that the contractual obligation of
the parties to arbitrate under the Royalty Agreement is mandatory.

2. The Honorable Board exceeded its jurisdiction when it sustained the cancellation of the Royalty Agreement for
alleged breach of contract despite the absence of evidence.

3. The Questioned Decision of the Honorable Board in cancelling the RAWOP prejudice[d] the substantial rights of
Benguet under the contract to the unjust enrichment of JG Realty.[12]

Restated, the issues are: (1) Should the controversy have first been submitted to arbitration before the POA took cognizance of
the case?; (2) Was the cancellation of the RAWOP supported by evidence?; and (3) Did the cancellation of the RAWOP amount to
unjust enrichment of J.G. Realty at the expense of Benguet?

The Courts Ruling

Before we dwell on the substantive issues, we find that the instant petition can be denied outright as Benguet resorted to an
improper remedy.

The last paragraph of Section 79 of Republic Act No. (RA) 7942 or the Philippine Mining Act of 1995 states, A petition for
review by certiorari and question of law may be filed by the aggrieved party with the Supreme Court within thirty (30) days from
receipt of the order or decision of the [MAB].

However, this Court has already invalidated such provision in Carpio v. Sulu Resources Development Corp.,[13] ruling that a
decision of the MAB must first be appealed to the Court of Appeals (CA) under Rule 43 of the Rules of Court, before recourse to
this Court may be had. We held, thus:
 To summarize, there are sufficient legal footings authorizing a review of the MAB Decision under Rule 43 of the Rules of
Court. First, Section 30 of Article VI of the 1987 Constitution, mandates that [n]o law shall be passed increasing the appellate jurisdiction
of the Supreme Court as provided in this Constitution without its advice and consent. On the other hand, Section 79 of RA No. 7942
provides that decisions of the MAB may be reviewed by this Court on a petition for review by certiorari. This provision is obviously an
expansion of the Courts appellate jurisdiction, an expansion to which this Court has not consented. Indiscriminate enactment of legislation
enlarging the appellate jurisdiction of this Court would unnecessarily burden it.
Second, when the Supreme Court, in the exercise of its rule-making power, transfers to the CA pending cases
involving a review of a quasi-judicial bodys decisions, such transfer relates only to procedure; hence, it does not impair the
substantive and vested rights of the parties. The aggrieved partys right to appeal is preserved; what is changed is only the
procedure by which the appeal is to be made or decided. The parties still have a remedy and a competent tribunal to grant
this remedy.

Third, the Revised Rules of Civil Procedure included Rule 43 to provide a uniform rule on appeals from quasi-
judicial agencies. Under the rule, appeals from their judgments and final orders are now required to be brought to the CA on
a verified petition for review. A quasi-judicial agency or body has been defined as an organ of government, other than a
court or legislature, which affects the rights of private parties through either adjudication or rule-making. MAB falls under
this definition; hence, it is no different from the other quasi-judicial bodies enumerated under Rule 43. Besides, the
introductory words in Section 1 of Circular No. 1-91among these agencies areindicate that the enumeration is not
exclusive or conclusive and acknowledge the existence of other quasi-judicial agencies which, though not expressly listed,
should be deemed included therein.

Fourth, the Court realizes that under Batas Pambansa (BP) Blg. 129 as amended by RA No. 7902, factual
controversies are usually involved in decisions of quasi-judicial bodies; and the CA, which is likewise tasked to resolve
questions of fact, has more elbow room to resolve them. By including questions of fact among the issues that may be raised
in an appeal from quasi-judicial agencies to the CA, Section 3 of Revised Administrative Circular No. 1-95 and Section 3 of
Rule 43 explicitly expanded the list of such issues.

According to Section 3 of Rule 43, [a]n appeal under this Rule may be taken to the Court of Appeals within the
period and in the manner herein provided whether the appeal involves questions of fact, of law, or mixed questions of fact
and law. Hence, appeals from quasi-judicial agencies even only on questions of law may be brought to the CA.

Fifth, the judicial policy of observing the hierarchy of courts dictates that direct resort from administrative agencies to
this Court will not be entertained, unless the redress desired cannot be obtained from the appropriate lower tribunals, or
unless exceptional and compelling circumstances justify availment of a remedy falling within and calling for the exercise of
our primary jurisdiction.[14]
 The above principle was reiterated in Asaphil Construction and Development Corporation v. Tuason, Jr.
(Asaphil).[15] However, the Carpio ruling was not applied toAsaphil as the petition in the latter case was filed in 1999 or three years
before the promulgation of Carpio in 2002. Here, the petition was filed on April 28, 2004 when the Carpiodecision was already
applicable, thus Benguet should have filed the appeal with the CA.

Petitioner having failed to properly appeal to the CA under Rule 43, the decision of the MAB has become final and executory.
On this ground alone, the instant petition must be denied.

Even if we entertain the petition although Benguet skirted the appeal to the CA via Rule 43, still, the December 2, 2002
Decision and March 17, 2004 Resolution of the DENR-MAB in MAB Case No. 0124-01 should be maintained.

First Issue: The case should have first been brought to

voluntary arbitration before the POA

Secs. 11.01 and 11.02 of the RAWOP pertinently provide:

11.01 Arbitration

Any disputes, differences or disagreements between BENGUET and the OWNER with reference to anything
whatsoever pertaining to this Agreement that cannot be amicably settled by them shall not be cause of any action of any
kind whatsoever in any court or administrative agency but shall, upon notice of one party to the other, be referred to a Board
of Arbitrators consisting of three (3) members, one to be selected by BENGUET, another to be selected by the OWNER and
the third to be selected by the aforementioned two arbitrators so appointed.

xxxx

11.02 Court Action

No action shall be instituted in court as to any matter in dispute as hereinabove stated, except to enforce the decision
of the majority of the Arbitrators.[16]
 Thus, Benguet argues that the POA should have first referred the case to voluntary arbitration before taking cognizance of the
case, citing Sec. 2 of RA 876 on persons and matters subject to arbitration.

On the other hand, in denying such argument, the POA ruled that:

While the parties may establish such stipulations clauses, terms and conditions as they may deem convenient, the
same must not be contrary to law and public policy. At a glance, there is nothing wrong with the terms and conditions of the
agreement. But to state that an aggrieved party cannot initiate an action without going to arbitration would be tying ones
hand even if there is a law which allows him to do so.[17]

The MAB, meanwhile, denied Benguets contention on the ground of estoppel, stating:

Besides, by its own act, Benguet is already estopped in questioning the jurisdiction of the Panel of Arbitrators to hear
and decide the case. As pointed out in the appealed Decision, Benguet initiated and filed an Adverse Claim docketed as
MAC-R-M-2000-02 over the same mining claims without undergoing contractual arbitration. In this particular case (MAC-
R-M-2000-02) now subject of the appeal, Benguet is likewise in estoppel from questioning the competence of the Panel of
Arbitrators to hear and decide in the summary proceedings J.G. Realtys petition, when Benguet itself did not merely move
for the dismissal of the case but also filed an Answer with counterclaim seeking affirmative reliefs from the Panel of
Arbitrators.[18]

Moreover, the MAB ruled that the contractual provision on arbitration merely provides for an additional forum or venue and
does not divest the POA of the jurisdiction to hear the case.[19]

In its July 20, 2004 Comment,[20] J.G. Realty reiterated the above rulings of the POA and MAB. It argued that RA 7942 or the
Philippine Mining Act of 1995 is a special law which should prevail over the stipulations of the parties and over a general law,
such as RA 876. It also argued that the POA cannot be considered as a court under the contemplation of RA 876 and that
jurisprudence saying that there must be prior resort to arbitration before filing a case with the courts is inapplicable to the instant
case as the POA is itself already engaged in arbitration.
 On this issue, we rule for Benguet.
Sec. 2 of RA 876 elucidates the scope of arbitration:
Section 2. Persons and matters subject to arbitration.Two or more persons or parties may submit to the arbitration of one or
more arbitrators any controversy existing between them at the time of the submission and which may be the subject of an action, or
the parties to any contract may in such contract agree to settle by arbitration a controversy thereafter arising between them. Such
submission or contract shall be valid, enforceable and irrevocable, save upon such grounds as exist at law for the revocation of any
contract.

Such submission or contract may include question[s] arising out of valuations, appraisals or other controversies which may be
collateral, incidental, precedent or subsequent to any issue between the parties. (Emphasis supplied.)

In RA 9285 or the Alternative Dispute Resolution Act of 2004, the Congress reiterated the efficacy of arbitration as an
alternative mode of dispute resolution by stating in Sec. 32 thereof that domestic arbitration shall still be governed by RA
876. Clearly, a contractual stipulation that requires prior resort to voluntary arbitration before the parties can go directly to court is
not illegal and is in fact promoted by the State. Thus, petitioner correctly cites several cases whereby arbitration clauses have been
upheld by this Court.[21]

Moreover, the contention that RA 7942 prevails over RA 876 presupposes a conflict between the two laws. Such is not the
case here. To reiterate, availment of voluntary arbitration before resort is made to the courts or quasi-judicial agencies of the
government is a valid contractual stipulation that must be adhered to by the parties. As stated in Secs. 6 and 7 of RA 876:
Section 6. Hearing by court.A party aggrieved by the failure, neglect or refusal of another to perform under an agreement
in writing providing for arbitration may petition the court for an order directing that such arbitration proceed in the manner
provided for in such agreement. Five days notice in writing of the hearing of such application shall be served either personally or by
registered mail upon the party in default. The court shall hear the parties, and upon being satisfied that the making of the agreement
or such failure to comply therewith is not in issue, shall make an order directing the parties to proceed to arbitration in accordance
with the terms of the agreement. If the making of the agreement or default be in issue the court shall proceed to summarily hear
such issue. If the finding be that no agreement in writing providing for arbitration was made, or that there is no default in the
proceeding thereunder, the proceeding shall be dismissed. If the finding be that a written provision for arbitration was made and
there is a default in proceeding thereunder, an order shall be made summarily directing the parties to proceed with the arbitration
in accordance with the terms thereof.
 xxxx

Section 7. Stay of civil action.If any suit or proceeding be brought upon an issue arising out of an agreement providing for the
arbitration thereof, the court in which such suit or proceeding is pending, upon being satisfied that the issue involved in such suit or
proceeding is referable to arbitration, shall stay the action or proceeding until an arbitration has been had in accordance with the terms of the
agreement: Provided, That the applicant, for the stay is not in default in proceeding with such arbitration. (Emphasis supplied.)

In other words, in the event a case that should properly be the subject of voluntary arbitration is erroneously filed with the
courts or quasi-judicial agencies, on motion of the defendant, the court or quasi-judicial agency shall determine whether such
contractual provision for arbitration is sufficient and effective. If in affirmative, the court or quasi-judicial agency shall then order
the enforcement of said provision. Besides, in BF Corporation v. Court of Appeals, we already ruled:

In this connection, it bears stressing that the lower court has not lost its jurisdiction over the case. Section 7 of
Republic Act No. 876 provides that proceedings therein have only been stayed. After the special proceeding of arbitration
has been pursued and completed, then the lower court may confirm the award made by the arbitrator.[22]

J.G. Realtys contention, that prior resort to arbitration is unavailing in the instant case because the POAs mandate is to
arbitrate disputes involving mineral agreements, is misplaced. A distinction must be made between voluntary and compulsory
arbitration. In Ludo and Luym Corporation v. Saordino, the Court had the occasion to distinguish between the two types of
arbitrations:
Comparatively, in Reformist Union of R.B. Liner, Inc. vs. NLRC, compulsory arbitration has been defined both as the
process of settlement of labor disputes by a government agency which has the authority to investigate and to make an
award which is binding on all the parties, and as a mode of arbitration where the parties are compelled to accept the
resolution of their dispute through arbitration by a third party. While a voluntary arbitrator is not part of the
governmental unit or labor departments personnel, said arbitrator renders arbitration services provided for under labor
laws.[23](Emphasis supplied.)

There is a clear distinction between compulsory and voluntary arbitration. The arbitration provided by the POA is compulsory,
while the nature of the arbitration provision in the RAWOP is voluntary, not involving any government agency. Thus, J.G. Realtys
argument on this matter must fail.
 As to J.G. Realtys contention that the provisions of RA 876 cannot apply to the instant case which involves an administrative
agency, it must be pointed out that Section 11.01 of the RAWOP states that:

[Any controversy with regard to the contract] shall not be cause of any action of any kind whatsoever in any court
or administrative agency but shall, upon notice of one party to the other, be referred to a Board of Arbitrators consisting of
three (3) members, one to be selected by BENGUET, another to be selected by the OWNER and the third to be selected by
the aforementioned two arbiters so appointed.[24] (Emphasis supplied.)

There can be no quibbling that POA is a quasi-judicial body which forms part of the DENR, an administrative agency. Hence,
the provision on mandatory resort to arbitration, freely entered into by the parties, must be held binding against them. [25]

In sum, on the issue of whether POA should have referred the case to voluntary arbitration, we find that, indeed, POA has no
jurisdiction over the dispute which is governed by RA 876, the arbitration law.

However, we find that Benguet is already estopped from questioning the POAs jurisdiction. As it were, when J.G. Realty
filed DENR Case No. 2000-01, Benguet filed its answer and participated in the proceedings before the POA, Region V. Secondly,
when the adverse March 19, 2001 POA Decision was rendered, it filed an appeal with the MAB in Mines Administrative Case No.
R-M-2000-01 and again participated in the MAB proceedings. When the adverse December 2, 2002 MAB Decision was
promulgated, it filed a motion for reconsideration with the MAB. When the adverse March 17, 2004 MAB Resolution was issued,
Benguet filed a petition with this Court pursuant to Sec. 79 of RA 7942 impliedly recognizing MABs jurisdiction. In this factual
milieu, the Court rules that the jurisdiction of POA and that of MAB can no longer be questioned by Benguet at this late hour. What
Benguet should have done was to immediately challenge the POAs jurisdiction by a special civil action for certiorari when POA
ruled that it has jurisdiction over the dispute. To redo the proceedings fully participated in by the parties after the lapse of seven
years from date of institution of the original action with the POA would be anathema to the speedy and efficient administration of
justice.

Second Issue: The cancellation of the RAWOP

was supported by evidence
 The cancellation of the RAWOP by the POA was based on two grounds: (1) Benguets failure to pay J.G. Realtys royalties
for the mining claims; and (2) Benguets failure to seriously pursue MPSA Application No. APSA-V-0009 over the mining claims.

As to the royalties, Benguet claims that the checks representing payments for the royalties of J.G. Realty were available for
pick-up in its office and it is the latter which refused to claim them. Benguet then thus concludes that it did not violate the RAWOP
for nonpayment of royalties. Further, Benguet reasons that J.G. Realty has the burden of proving that the former did not pay such
royalties following the principle that the complainants must prove their affirmative allegations.

With regard to the failure to pursue the MPSA application, Benguet claims that the lengthy time of approval of the application
is due to the failure of the MGB to approve it. In other words, Benguet argues that the approval of the application is solely in the
hands of the MGB.

Benguets arguments are bereft of merit.

Sec. 14.05 of the RAWOP provides:

14.05 Bank Account

OWNER shall maintain a bank account at ___________ or any other bank from time to time selected by OWNER
with notice in writing to BENGUET where BENGUET shall deposit to the OWNERs credit any and all advances and
payments which may become due the OWNER under this Agreement as well as the purchase price herein agreed upon in the
event that BENGUET shall exercise the option to purchase provided for in the Agreement. Any and all deposits so made
by BENGUET shall be a full and complete acquittance and release to [sic] BENGUET from any further liability to
the OWNER of the amounts represented by such deposits. (Emphasis supplied.)

Evidently, the RAWOP itself provides for the mode of royalty payment by Benguet. The fact that there was the previous
practice whereby J.G. Realty picked-up the checks from Benguet is unavailing. The mode of payment is embodied in a contract
between the parties. As such, the contract must be considered as the law between the parties and binding on both. [26] Thus, after J.G.
Realty informed Benguet of the bank account where deposits of its royalties may be made, Benguet had the obligation to deposit the
checks. J.G. Realty had no obligation to furnish Benguet with a Board Resolution considering that the RAWOP itself provided for
such payment scheme.

Notably, Benguets claim that J.G. Realty must prove nonpayment of its royalties is both illogical and unsupported by law and
jurisprudence.

The allegation of nonpayment is not a positive allegation as claimed by Benguet. Rather, such is a negative allegation that
does not require proof and in fact transfers the burden of proof to Benguet. Thus, this Court ruled in Jimenez v. National Labor
Relations Commission:
As a general rule, one who pleads payment has the burden of proving it. Even where the plaintiff must allege non-payment, the
general rule is that the burden rests on the defendant to prove payment, rather than on the plaintiff to prove non-payment. The debtor has
the burden of showing with legal certainty that the obligation has been discharged by payment.[27] (Emphasis supplied.)

In the instant case, the obligation of Benguet to pay royalties to J.G. Realty has been admitted and supported by the provisions
of the RAWOP. Thus, the burden to prove such obligation rests on Benguet.

It should also be borne in mind that MPSA Application No. APSA-V-0009 has been pending with the MGB for a considerable
length of time. Benguet, in the RAWOP, obligated itself to perfect the rights to the mining claims and/or otherwise acquire the
mining rights to the mineral claims but failed to present any evidence showing that it exerted efforts to speed up and have the
application approved. In fact, Benguet never even alleged that it continuously followed-up the application with the MGB and that it
was in constant communication with the government agency for the expeditious resolution of the application. Such allegations would
show that, indeed, Benguet was remiss in prosecuting the MPSA application and clearly failed to comply with its obligation in the
RAWOP.

Third Issue: There is no unjust enrichment in the instant case

Based on the foregoing discussion, the cancellation of the RAWOP was based on valid grounds and is, therefore, justified. The
necessary implication of the cancellation is the cessation of Benguets right to prosecute MPSA Application No. APSA-V-0009 and
to further develop such mining claims.
 In Car Cool Philippines, Inc. v. Ushio Realty and Development Corporation, we defined unjust enrichment, as follows:

We have held that [t]here is unjust enrichment when a person unjustly retains a benefit to the loss of another, or
when a person retains money or property of another against the fundamental principles of justice, equity and good
conscience. Article 22 of the Civil Code provides that [e]very person who through an act of performance by another, or
any other means, acquires or comes into possession of something at the expense of the latter without just or legal ground,
shall return the same to him. The principle of unjust enrichment under Article 22 requires two conditions: (1) that a person
is benefited without a valid basis or justification, and (2) that such benefit is derived at anothers expense or damage.

There is no unjust enrichment when the person who will benefit has a valid claim to such benefit. [28] (Emphasis
supplied.)

Clearly, there is no unjust enrichment in the instant case as the cancellation of the RAWOP, which left Benguet without any
legal right to participate in further developing the mining claims, was brought about by its violation of the RAWOP. Hence, Benguet
has no one to blame but itself for its predicament.

WHEREFORE, we DISMISS the petition, and AFFIRM the December 2, 2002 Decision and March 17, 2004 Resolution of
the DENR-MAB in MAB Case No. 0124-01 upholding the cancellation of the June 1, 1987 RAWOP. No costs.

SO ORDERED.

[G.R. No. 148267. August 8, 2002]

ARMANDO C. CARPIO, petitioner, vs. SULU RESOURCES DEVELOPMENT CORPORATION, respondent.

DECISION
PANGANIBAN, J.:
 Decisions and final orders of the Mines Adjudication Board (MAB) are appealable to the Court of Appeals under Rule 43
of the 1997 Rules of Court. Although not expressly included in the Rule, the MAB is unquestionably a quasi-judicial agency
and stands in the same category as those enumerated in its provisions.

The Case

Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, challenging the August 31, 2000
Decision and May 3, 2001 Resolution of the Court of Appeals (CA) in CA-GR SP No. 46830. The Assailed Decision
[1] [2]

disposed as follows:
WHEREFORE, premises considered, the petition for review is hereby DENIED. [3]

Reconsideration was denied in the assailed Resolution.

The Facts

In the challenged Decision, the CA summarized the facts of this case as follows:
This case originated from a petition filed by respondent [Sulu Resources Development Corporation] for Mines Production Sharing
Agreement (MPSA) No. MPSA-IV-131, covering certain areas in Antipolo, Rizal. Petitioner [Armando C. Carpio] filed an
opposition/adverse claim thereto, alleging, inter alia, that his landholdings in Cupang and Antipolo, Rizal will be covered by
respondents claim, thus he enjoys a preferential right to explore and extract the quarry resources on his properties.
After due proceedings were held, the Panel of Arbitrators of the Mines and Geo-Sciences Bureau of the DENR rendered a Resolution
dated September 26, 1996, upholding petitioners opposition/adverse claim. This dispositive portion of said Resolution reads:
x x x. WHEREFORE, the opposition/adverse claims of ARMANDO C. CARPIO is hereby UPHELD. Accordingly, the properties of
CARPIO are ordered excluded from the area of PMPSA-IV-131 of SULU RESOURCES DEVELOPMENT CORPORATION, and the
area not covered by the adverse claim as subject to mining locations in accordance with existing laws, rules and regulations.
SO ORDERED.
Respondent appealed the foregoing Resolution to the Mines Adjudication Board. Meanwhile, petitioner filed a motion to dismiss appeal
on the ground of respondents failure to comply with the requirements of the New Mining Acts Implementing Rules and Regulations.
On June 20, 1997, the Mines Adjudication Board rendered the assailed Order dismissing petitioners opposition/adverse claim. The
dispositive portion of the assailed Order provides:
WHEREFORE, in view of the foregoing premises, this Resolution of the Panel of Arbitrators of Region IV dated September 26, 1996, is
hereby SET ASIDE and the adverse claim/opposition of CARPIO DISMISSED. Accordingly, the PMSPA of SULU should be given due
process and evaluated subject to the pertinent provisions of RA 7942 and DAO 96-40.
SO ORDERED.
Petitioner filed a motion for reconsideration of said Order which was denied by the Board per Order dated November 24, 1997, the
decretal portion of which provides:
WHEREFORE, the Motion for Reconsideration is hereby DENIED for lack of merit. [4]

Ruling of the Court of Appeals

Citing Section 79 of Chapter XIII of the Philippine Mining Act of 1995 (RA 7942), the CA ruled that it did not have
jurisdiction to review the Decision of the Mines Adjudication Board (MAB). The adjudication of conflicting mining claims is
completely administrative in nature, as held in Pearson v. Intermediate Appellate Court. Under RA 7942, the settlement of
[5]

disputes involving rights to mining areas, mineral agreements, and surface owners, occupants and
claimholders/concessionaires shall pertain exclusively to a Panel of Arbitrators in the regional office of the Department of
Environment and Natural Resources, whose decisions are appealable to the Mines Adjudication Board. Under Section 79 of
RA 7942, the findings of fact by the MAB as well as its decision or order shall be final and executory.
Inasmuch as the issue raised by petitioner relates to whether an overlap or a conflict between his properties and the area
covered by the application of respondent has been proven, MABs finding thereon was binding and conclusive, and the
Boards Decision was already final and executory.
Hence, this Petition. [6]

Issue

In his Memorandum, petitioner raises this sole issue for our consideration:
Whether or not appeals from the Decision or Final Orders of the Mines Adjudication Board should be made directly to the Supreme
Court as contended by the respondent and the Court of Appeals, or such appeals be first made to the Court of Appeals as contended by
herein petitioner.
[7]
 This Courts Ruling

The Petition is meritorious.

Sole Issue:
Appellate Jurisdiction over MAB Decisions

The Case
Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, challenging the August 31, 2000
Decision[1] and May 3, 2001 Resolution[2] of the Court of Appeals (CA) in CA-GR SP No. 46830. The Assailed Decision
disposed as follows:
WHEREFORE, premises considered, the petition for review is hereby DENIED.[3]
Reconsideration was denied in the assailed Resolution.
The Facts
In the challenged Decision, the CA summarized the facts of this case as follows:
This case originated from a petition filed by respondent [Sulu Resources Development Corporation] for Mines
Production Sharing Agreement (MPSA) No. MPSA-IV-131, covering certain areas in Antipolo, Rizal. Petitioner [Armando C.
Carpio] filed an opposition/adverse claim thereto, alleging, inter alia, that his landholdings in Cupang and Antipolo, Rizal will
be covered by respondents claim, thus he enjoys a preferential right to explore and extract the quarry resources on his
properties.
After due proceedings were held, the Panel of Arbitrators of the Mines and Geo-Sciences Bureau of the DENR rendered
a Resolution dated September 26, 1996, upholding petitioners opposition/adverse claim. This dispositive portion of said
Resolution reads:
x x x. WHEREFORE, the opposition/adverse claims of ARMANDO C. CARPIO is hereby UPHELD. Accordingly, the
properties of CARPIO are ordered excluded from the area of PMPSA-IV-131 of SULU RESOURCES DEVELOPMENT
CORPORATION, and the area not covered by the adverse claim as subject to mining locations in accordance with existing
laws, rules and regulations.
SO ORDERED.
 Respondent appealed the foregoing Resolution to the Mines Adjudication Board. Meanwhile, petitioner filed a motion to
dismiss appeal on the ground of respondents failure to comply with the requirements of the New Mining Acts Implementing
Rules and Regulations.
On June 20, 1997, the Mines Adjudication Board rendered the assailed Order dismissing petitioners opposition/adverse
claim. The dispositive portion of the assailed Order provides:
WHEREFORE, in view of the foregoing premises, this Resolution of the Panel of Arbitrators of Region IV dated
September 26, 1996, is hereby SET ASIDE and the adverse claim/opposition of CARPIO DISMISSED. Accordingly, the
PMSPA of SULU should be given due process and evaluated subject to the pertinent provisions of RA 7942 and DAO 96-40.
SO ORDERED.
Petitioner filed a motion for reconsideration of said Order which was denied by the Board per Order dated November 24,
1997, the decretal portion of which provides:
WHEREFORE, the Motion for Reconsideration is hereby DENIED for lack of merit.[4]
Ruling of the Court of Appeals
Citing Section 79 of Chapter XIII of the Philippine Mining Act of 1995 (RA 7942), the CA ruled that it did not have
jurisdiction to review the Decision of the Mines Adjudication Board (MAB). The adjudication of conflicting mining claims is
completely administrative in nature, as held in Pearson v. Intermediate Appellate Court.[5] Under RA 7942, the settlement of
disputes involving rights to mining areas, mineral agreements, and surface owners, occupants and
claimholders/concessionaires shall pertain exclusively to a Panel of Arbitrators in the regional office of the Department of
Environment and Natural Resources, whose decisions are appealable to the Mines Adjudication Board. Under Section 79 of
RA 7942, the findings of fact by the MAB as well as its decision or order shall be final and executory.
Inasmuch as the issue raised by petitioner relates to whether an overlap or a conflict between his properties and the area
covered by the application of respondent has been proven, MABs finding thereon was binding and conclusive, and the
Boards Decision was already final and executory.
Hence, this Petition.[6]
Issue
In his Memorandum, petitioner raises this sole issue for our consideration:
Whether or not appeals from the Decision or Final Orders of the Mines Adjudication Board should be made directly to
the Supreme Court as contended by the respondent and the Court of Appeals, or such appeals be first made to the Court of
Appeals as contended by herein petitioner.[7]
 This Courts Ruling
The Petition is meritorious.
Sole Issue:
Appellate Jurisdiction over MAB Decisions
Petitioner submits that appeals from the decisions of the MAB should be filed with the CA. First, the Supreme Court has
authority, under Section 5(5) of Article VIII of the Philippine Constitution, to promulgate rules of procedure in all courts,
including all quasi-judicial agencies such as the MAB. Second, Section 3 of Rule 43 of the 1997 Rules of Civil Procedure
authorizes appeals to the CA from judgments or final orders of quasi-judicial tribunals by means of petitions for review. Third,
the MAB gravely abused its discretion in deliberately, willfully and unlawfully disregarding petitioners rights to the land
unduly included in the questioned application for a Mines Productive Sharing Agreement (MPSA).
En contrario, the CA ruled and respondent agrees that the settlement of disputes involving rights to mining areas and
overlapping or conflicting claim is a purely administrative matter, over which the MAB has appellate jurisdiction. The latters
factual findings, decisions and final orders on such matters are final and executory as provided in Section 79 of Chapter XIII
of the Philippine Mining Act of 1995 and as held in Pearson v. IAC. Since the appeal of petitioner pertains to the factual
matter of whether he was able to prove the existence of the overlap or conflict between his claimed area and that covered by
respondents application, then the findings of the MAB should be deemed final and executory.
The CA refused to take jurisdiction over the case because, under Section 79 of the Philippine Mining Act of 1995,
petitions for review of MAB decisions are to be brought directly to the Supreme Court. The provision reads in part:
xxx xxx xxx
A petition for review by certiorari and question of law may be filed by the aggrieved party with the Supreme Court within
thirty (30) days from receipt of the order or decision of the Board.
We hold that respondents reliance on Pearson is misplaced. The claimant therein sued in the then Court of First Instance
(CFI) to prevent the execution of a Decision rendered by the panel of investigators of the Bureau of Mines and the Office of
the President. Despite a Motion to Dismiss filed by the mining companies, the CFI ordered the creation of a committee to
determine the correct tie-point of their claims. So, the mining companies went to the then Intermediate Appellate Court (IAC)
via a Petition for Certiorari under Rule 65. The claimants averred that the appellate court had no jurisdiction.
In the case at bar, petitioner went to the CA through a Petition for Review on Certiorari under Rule 43, seeking a reversal
of the MAB Decision. Given the difference in the reason for and the mode of appeal, it is obvious that Pearson is not
applicable here.
 Still, we can draw one lesson. Far from dismissing the case on the ground of lack of jurisdiction, Pearson expressly held
that the CA had jurisdiction over the petition for certiorari, because Section 9 of BP Blg. 129 (The Judiciary Reorganization
Act of 1980), now incorporated in Section 4, Rule 65 of the 1997 Rules of Civil Procedure, vested the then IAC with original
jurisdiction to issue writs of certiorari and prohibition, among other auxillary writs x x x. However, even though the Supreme
Court has concurrent jurisdiction with the CA and the Regional Trial Courts to issue a writ of mandamus, prohibition or
certiorari, litigants are well advised against taking a direct recourse to this Court without initially seeking proper relief from the
lower courts, in accordance with the hierarchy of courts.[8]
In Pearson, what was under review was the ruling of the CFI to take cognizance of the case which had been earlier
decided by the MAB, not the MAB Decision itself which was promulgated by the CA under Rule 43. The present petitioner
seeks a review of the latter.
Pearson held that the nature of the primary powers granted by law to the then secretary of agriculture and natural
resources as well as to the director of mines were executive or administrative, such as granting of license, permits, lease
and contracts[;] or approving, rejecting, reinstating or canceling applications[;] or deciding conflicting applications. These
powers should be distinguished from litigants disagreements or controversies that are civil or contractual in nature, which
may be adjudicated only by the courts of justice. The findings of fact of the MAB, which exercises appellate jurisdiction over
decisions or orders of the panel of arbitrators, are conclusive and binding on the parties; its decisions or orders on these are
final and executory. But petitions for certiorari may be filed with the appropriate courts.[9] In short, the Court held that the
appellate jurisdiction of the IAC (now the CA) in Pearson fell under Rule 65 -- not 43 -- because what was being impugned
was grave abuse of discretion on the part of the CFI.
Pearson, however, should be understood in the light of other equally relevant jurisprudence. In Fabian v. Desierto,[10] the
Court clarified that appeals from judgments and final orders of quasi-judicial agencies are now required to be brought to the
CA, under the requirements and conditions set forth in Rule 43. This Rule was adopted precisely to provide a uniform rule of
appellate procedure from quasi-judicial agencies.[11]
Section 27 of RA 6770[12] which is similarly worded as Section 79 of the Philippine Mining Act, was struck down by
Fabian as unconstitutional, because it had broadened the appellate jurisdiction of the Supreme Court without its consent, in
violation of Section 30 of Article VI of the Constitution.[13] In short, Section 27 of RA 6770 which provides that all
administrative decisions of the Office of the Ombudsman may be appealed to the Supreme Court, was unconstitutional.
In another case, held invalid in the light of Rule 43 of the 1997 Rules of Court was Section 3(2) of Executive Order No.
561, which had declared that decisions of the Commission on Settlement of Land Problems (COSLAP) were appealable
exclusively to the Supreme Court.[14] There is no convincing reason why appeals from the COSLAP should be treated
differently from those arising from other quasi-judicial bodies, the decisions of which are directly appealable to the CA under
Rule 43 of the 1997 Rules.
 Finally, Metro Construction, Inc. v. Chat ham Properties, Inc.[15] held that Section 19 of Executive Order No. 1008 --
which had deemed arbitral awards of the Construction Industry Arbitration Commission (CIAC) to be appealable to the
Supreme Court on questions of law -- was modified by Circular No. 1-91, Batas Pambansa Blg. 129 as amended by RA
7902, Revised Administrative Circular 1-95, and Rule 43 of the Rules of Court. Reiterating Fabian, the Court ruled that
appeals were procedural and remedial in nature; hence, constitutionally subject to this Courts rule-making power.
In the present case, it is claimed that a petition for review is improper because petitioners challenge is purely factual,
bearing only on the MAB ruling that there was no overlap or conflict between the litigants claims.
We clarify. Factual controversies are usually involved in administrative actions; and the CA is prepared to handle such
issues because, unlike this Court, it is mandated to rule on questions of fact.[16] In Metro Construction, we observed that not
only did the CA have appellate jurisdiction over CIAC decisions and orders, but the review of such decisions included
questions of fact and law.[17] At the very least when factual findings of the MAB are challenged or alleged to have been
made in grave abuse of discretion as in the present case, the CA may review them, consistent with the constitutional duty[18]
of the judiciary.
To summarize, there are sufficient legal footings authorizing a review of the MAB Decision under Rule 43 of the Rules of
Court. First, Section 30 of Article VI of the 1987 Constitution, mandates that [n]o law shall be passed increasing the
appellate jurisdiction of the Supreme Court as provided in this Constitution without its advice and consent. On the other
hand, Section 79 of RA No. 7942 provides that decisions of the MAB may be reviewed by this Court on a petition for review
by certiorari. This provision is obviously an expansion of the Courts appellate jurisdiction, an expansion to which this Court
has not consented. Indiscriminate enactment of legislation enlarging the appellate jurisdiction of this Court would
unnecessarily burden it.[19]
Second, when the Supreme Court, in the exercise of its rule-making power, transfers to the CA pending cases involving a
review of a quasi-judicial bodys decisions, such transfer relates only to procedure; hence, it does not impair the substantive
and vested rights of the parties. The aggrieved partys right to appeal is preserved; what is changed is only the procedure by
which the appeal is to be made or decided.[20] The parties still have a remedy and a competent tribunal to grant this remedy.
Third, the Revised Rules of Civil Procedure included Rule 43 to provide a uniform rule on appeals from quasi-judicial
agencies.[21] Under the rule, appeals from their judgments and final orders are now required to be brought to the CA on a
verified petition for review.[22] A quasi-judicial agency or body has been defined as an organ of government, other than a
court or legislature, which affects the rights of private parties through either adjudication or rule-making.[23] MAB falls under
this definition; hence, it is no different from the other quasi-judicial bodies enumerated under Rule 43. Besides, the
introductory words in Section 1 of Circular No. 1-91 -- among these agencies are -- indicate that the enumeration is not
exclusive or conclusive and acknowledge the existence of other quasi-judicial agencies which, though not expressly listed,
should be deemed included therein.[24]
 Fourth, the Court realizes that under Batas Pambansa (BP) Blg. 129[25] as amended by RA No. 7902,[26] factual
controversies are usually involved in decisions of quasi-judicial bodies; and the CA, which is likewise tasked to resolve
questions of fact, has more elbow room to resolve them. By including questions of fact[27] among the issues that may be
raised in an appeal from quasi-judicial agencies to the CA, Section 3 of Revised Administrative Circular No. 1-95 and Section
3 of Rule 43 explicitly expanded the list of such issues.
According to Section 3 of Rule 43, [a]n appeal under this Rule may be taken to the Court of Appeals within the period
and in the manner herein provided whether the appeal involves questions of fact, of law, or mixed questions of fact and law.
Hence, appeals from quasi-judicial agencies even only on questions of law may be brought to the CA.
Fifth, the judicial policy of observing the hierarchy of courts dictates that direct resort from administrative agencies to this
Court will not be entertained, unless the redress desired cannot be obtained from the appropriate lower tribunals, or unless
exceptional and compelling circumstances justify availment of a remedy falling within and calling for the exercise of our
primary jurisdiction.[28]
Consistent with these rulings and legal bases, we therefore hold that Section 79 of RA 7942 is likewise to be understood
as having been modified by Circular No. 1-91, BP Blg. 129 as amended by RA 7902, Revised Administrative Circular 1-95,
and Rule 43 of the Rules of Court. In brief, appeals from decisions of the MAB shall be taken to the CA through petitions for
review in accordance with the provisions of Rule 43 of the 1997 Rules of Court.
WHEREFORE, the Petition is GRANTED, and the assailed Decision and Resolution REVERSED and SET ASIDE. The
Petition in CA-GR SP No. 46830 is REINSTATED, and the CA is ordered to RESOLVE it on the merits with deliberate
dispatch. No costs.

SO ORDERED.
CELESTIAL NICKEL MINING G.R. No. 169080
EXPLORATION CORPORATION,
Petitioner,
Present:
- versus -
QUISUMBING, J., Chairperson,
CARPIO MORALES,
MACROASIA CORPORATION TINGA,
(formerly INFANTA MINERAL AND VELASCO, JR., and
INDUSTRIAL CORPORATION), CHICO-NAZARIO,* JJ.
BLUE RIDGE MINERAL
CORPORATION, and LEBACH
MINING CORPORATION,
Respondents.

x ---------------------------------------------- x

BLUE RIDGE MINERAL G.R. No. 172936

CORPORATION,
Petitioner,

- versus -

HON. ANGELO REYES in his

capacity as SECRETARY of
the DEPARTMENT OF
ENVIRONMENT AND NATURAL Promulgated:
RESOURCES, HON. GUILLERMO
ESTABILLO in his capacity as
REGIONAL DIRECTOR of the December 19, 2007
MINES AND GEOSCIENCES
BUREAU, REGION IV-B of the
DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES, and
MACROASIA CORPORATION
(formerly INFANTA MINERAL AND
INDUSTRIAL CORPORATION),
Respondents.

x ---------------------------------------------- x
CELESTIAL NICKEL MINING G.R. No. 176226
EXPLORATION CORPORATION,
Petitioner,

- versus -

BLUE RIDGE MINERAL

CORPORATION and MACROASIA
CORPORATION (formerly INFANTA
MINERAL AND INDUSTRIAL
CORPORATION),
Respondents.
x ---------------------------------------------- x

MACROASIA CORPORATION G.R. No. 176319

(formerly INFANTA MINERAL AND
INDUSTRIAL CORPORATION),
Petitioner,

- versus -

BLUE RIDGE MINERAL

CORPORATION and CELESTIAL
NICKEL MINING EXPLORATION
CORPORATION,
Respondents.
x-----------------------------------------------------------------------------------------x

DECISION

VELASCO, JR., J.:

 The Case

Before us are four (4) petitions. The first is a Petition for Review on Certiorari [1] under Rule 45 docketed as G.R. No. 169080,
wherein petitioner Celestial Nickel Mining Exploration Corporation (Celestial) seeks to set aside the April 15, 2005 Decision [2] of
the Court of Appeals (CA) in CA-G.R. SP No. 87931. The CA affirmed the November 26, 2004 Resolution of the Mines
Adjudication Board (MAB) in MAB Case Nos. 056-97 and 057-97 (DENR Case Nos. 97-01 and 97-02), upholding the authority of
the Department of Environment and Natural Resources (DENR) Secretary to grant and cancel mineral agreements. Also assailed is
the August 3, 2005 Resolution[3] of the CA denying the Motion for Reconsideration of the assailed Decision.

The second is a Petition for Certiorari[4] under Rule 65 docketed as G.R. No. 172936, wherein petitioner Blue Ridge Mineral
Corporation (Blue Ridge) seeks to annul and set aside the action of then Secretary Michael T. Defensor, in his capacity as DENR
Secretary, approving and signing two Mineral Production Sharing Agreements (MPSAs) in favor of Macroasia Corporation
(Macroasia) denominated as MPSA Nos. 220-2005-IVB and 221-2005-IVB.

And the third and fourth are petitions for review on certiorari[5] under Rule 45 docketed as G.R. No. 176226 and G.R. No.
176319, wherein petitioners Celestial and Macroasia, respectively, seek to set aside the May 18, 2006 Decision [6] of the CA in CA-
G.R. SP No. 90828. The CA reversed and set aside the November 26, 2004 and July 12, 2005 Resolutions of the MAB, and
reinstated the October 24, 2000 Decision in MAB Case Nos. 056-97 and 057-97, granting Blue Ridge the prior and preferential right
to file its application over the mining claims of Macroasia. These petitions likewise seek to set aside the January 19,
2007 Resolution[7] of the CA denying petitioners motions for reconsideration of the assailed Decision.

Through our July 5, 2006 Resolution,[8] we consolidated the first two cases. While in our subsequent April 23, 2007[9] and July
11, 2007[10] Resolutions, we consolidated the four cases as they arose from the same facts.

The undisputed facts as found by the CA in CA-G.R. SP No. 87931 are as follows:

On September 24, 1973, the then Secretary of Agriculture and Natural Resources and Infanta Mineral and Industrial
Corporation (Infanta) entered into a Mining Lease Contract (V-1050) for a term of 25 years up to September 23, 1998 for mining
lode claims covering an area of 216 hectares at Sitio Linao, Ipilan, Brookes Point, Palawan. The mining claims of Infanta covered
by lode/lease contracts were as follows:
 Contract No. Area Date of Issuance
LLC-V-941 18 hectares January 17, 1972
LC-V-1050 216 hectares September 24, 1973
LLC-V-1060 16 hectares October 30, 1973
LLC-V-1061 144 hectares October 30, 1973
LLC-V-1073 144 hectares April 18, 1973
MLC-MRD-52 306 hectares April 26, 1978
MLC-MRC-53 72 hectares April 26, 1978

Infantas corporate name was changed to Cobertson Holdings Corporation on January 26, 1994 and subsequently to its present
name, Macroasia Corporation, onNovember 6, 1995.

Sometime in 1997, Celestial filed a Petition to Cancel the subject mining lease contracts and other mining claims of Macroasia
including those covered by Mining Lease Contract No. V-1050, before the Panel of Arbitrators (POA) of the Mines and Geo-
Sciences Bureau (MGB) of the DENR. The petition was docketed as DENR Case No. 97-01.

Blue Ridge, in an earlier letter-petition, also wrote the Director of Mines to seek cancellation of mining lease contracts and
other mining rights of Macroasia and another entity, Lebach Mining Corporation (Lebach), in mining areas in Brookes Point. The
petition was eventually docketed as DENR Case No. 97-02.

Celestial is the assignee of 144 mining claims covering such areas contiguous to Infantas (now Macroasia) mining lode
claims. Said area was involved in protracted administrative disputes with Infanta (now Macroasia), Lecar & Sons, Inc., and Palawan
Nickel Mining Corporation. Celestial also holds an MPSA with the government which covers 2,835 hectares located at
Ipilan/Maasin, Brookes Point, Palawan and two pending applications covering another 4,040 hectares in Barangay Mainit also in
Brookes Point.

Celestial sought the cancellation of Macroasias lease contracts on the following grounds: (1) the nonpayment of Macroasia
of required occupational fees and municipal taxes; (2) the non-filing of Macroasia of Affidavits of Annual Work Obligations; (3) the
failure of Macroasia to provide improvements on subject mining claims; (4) the concentration of Macroasia on logging; (5) the
encroachment, mining, and extraction by Macroasia of nickel ore from Celestials property; (6) the ability of Celestial to subject the
mining areas to commercial production; and (7) the willingness of Celestial to pay fees and back taxes of Macroasia.

In the later part of the proceedings, Macroasia intervened in the case and submitted its position paper refuting the grounds for
cancellation invoked by Celestial.[11]

The Ruling of the Panel of Arbitrators in

DENR Case Nos. 97-01 and 97-02

Based on the records of the Bureau of Mines and findings of the field investigations, the POA found that Macroasia and
Lebach not only automatically abandoned their areas/mining claims but likewise had lost all their rights to the mining claims. The
POA granted the petition of Celestial to cancel the following Mining Lease Contracts of Macroasia: LLC-V-941, LLC-V-1050,
LLC-V-1060, LLC-V-1061, LLC-V-1073, MLC-MRD-52, and MLC-MRC-53; and found the claims of the others indubitably
meritorious. It gave Celestial the preferential right to Macroasias mining areas.[12] It upheld Blue Ridges petition regarding DENR
Case No. 97-02, but only as against the Mining Lease Contract areas of Lebach (LLC-V-1153, LLC-V-1154, and LLC-V-1155), and
the said leased areas were declared automatically abandoned. It gave Blue Ridge priority right to the aforesaid Lebachs
areas/mining claims.[13]

Blue Ridge and Macroasia appealed before the MAB, and the cases were docketed as MAB Case Nos. 056-97 and 057-97,
respectively.

Lebach did not file any notice of appeal with the required memorandum of appeal; thus, with respect to Lebach, the above
resolution became final and executory.

The Rulings of the Mines Adjudication Board in

MAB Case Nos. 056-97 and 057-97 (DENR Case Nos. 97-01 and 97-02)
 The MAB resolved the issues of timeliness and perfection of Macroasias appeal; Macroasias abandonment of its mining
claims; and the preferential right over the abandoned mining claims of Macroasia.

Conformably with Section 51 of Consolidated Mines Administrative Order (CMAO)[14] implementing Presidential Decree No.
(PD) 463[15] and our ruling in Medrana v. Office of the President (OP),[16] the MAB affirmed the POA findings that Macroasia
abandoned its mining claims. The MAB found that Macroasia did not comply with its work obligations from 1986 to 1991. It based
its conclusion on the field verifications conducted by the MGB, Region IV and validated by the Special Team tasked by the
MAB.[17]However, contrary to the findings of the POA, the MAB found that it was Blue Ridge that had prior and preferential rights
over the mining claims of Macroasia, and not Celestial.

Thus, on October 24, 2000, the MAB promulgated its Decision upholding the Decision of the POA to cancel the Mining
Lode/Lease Contracts of Macroasia; declaring abandoned the subject mining claims; and opening the mining area with prior and
preferential rights to Blue Ridge for mining applications, subject to strict compliance with the procedure and requirements provided
by law. In case Blue Ridge defaults, Celestial could exercise the secondary priority and preferential rights, and subsequently, in case
Celestial also defaults, other qualified applicants could file.[18]
Both Celestial and Macroasia moved for reconsideration.[19] Celestial asserted that it had better rights than Blue Ridge over the
mining claims of Macroasia as it had correctly filed its petition, and filed its MPSA application after Macroasias lease contract
expired on January 17, 1997 and after the POAs resolution was issued on September 1, 1997. Moreover, it argued that priority was
not an issue when the contested area had not yet been declared abandoned. Thus, Blue Ridges MPSA application filed on June 17,
1996 had no effect and should not be considered superior since Macroasias lease contracts were still valid and subsisting and could
not have been canceled by Macroasias mere failure to perform annual work obligations and pay corresponding royalties/taxes to the
government.

Macroasia, in its Motion for Reconsideration, reiterated that it did not abandon its mining claims, and even if mining was not
listed among its purposes in its amended Articles of Incorporation, its mining activities were acts that were only ultra vires but were
ratified as a secondary purpose by its stockholders in subsequent amendments of its Articles of Incorporation.

Before the MAB could resolve the motions for reconsideration, on March 16, 2001, Macroasia filed its Supplemental Motion
for Reconsideration[20] questioning the jurisdiction of the POA in canceling mining lease contracts and mining claims. Macroasia
averred that the power and authority to grant, cancel, and revoke mineral agreements is exclusively lodged with the DENR
Secretary. Macroasia further pointed out that in arrogating upon itself such power, the POA whimsically and capriciously discarded
the procedure on conferment of mining rights laid down in Republic Act No. (RA) 7942, The Philippine Mining Act of 1995, and
DENR Administrative Order No. (AO) 96-40,[21]and perfunctorily and improperly awarded its mining rights to Blue Ridge and
Celestial.

Subsequently, on November 26, 2004, the MAB issued a Resolution [22] vacating its October 24, 2000 Decision, holding that
neither the POA nor the MAB had the power to revoke a mineral agreement duly entered into by the DENR Secretary, ratiocinating
that there was no provision giving the POA and MAB the concurrent power to manage or develop mineral resources. The MAB
further held that the power to cancel or revoke a mineral agreement was exclusively lodged with the DENR Secretary; that a petition
for cancellation is not a mining dispute under the exclusive jurisdiction of the POA pursuant to Sec. 77 of RA 7942; and that the
POA could only adjudicate claims or contests during the MPSA application and not when the claims and leases were already granted
and subsisting.

Moreover, the MAB held that there was no abandonment by Macroasia because the DENR Secretary had not decided to
release Macroasia from its obligations. The Secretary may choose not to release a contractor from its obligations on grounds of
public interest. Thus, through its said resolution, the MAB rendered its disposition, as follows:

WHEREFORE, premises considered, the assailed Decision of October 24, 2000 is hereby VACATED. The seven
(7) mining lease contracts of Macroasia Corporation (formerly Infanta Mineral & Industrial Corporation) are DECLARED
SUBSISTING prior to their expirations without prejudice to any Decision or Order that the Secretary may render on the
same. NO PREFERENTIAL RIGHT over the same mining claims is accorded to Blue Ridge Mineral Corporation or
Celestial Nickel Mining Exploration Corporation also without prejudice to the determination by the Secretary over the
matter at the proper time.[23]

After the issuance of the MAB Resolution, Celestial and Blue Ridge went through divergent paths in their quest to protect
their individual interests.
 On January 10, 2005, Celestial assailed the November 26, 2004 MAB Resolution before the CA in a petition for
review[24] under Rule 43 of the Rules of Court. The petition entitled Celestial Nickel Mining Exploration Corporation v. Macroasia
Corporation, et al. was docketed as CA-G.R. SP No. 87931.

On the other hand, Blue Ridge first filed a Motion for Reconsideration[25] which was denied.[26] On August 26, 2005, Blue
Ridge questioned the MABs November 26, 2004 and July 12, 2005 Resolutions before the CA in a petition for
review[27] entitled Blue Ridge Mineral Corporation v. Mines Adjudication Board, et al. docketed as CA-G.R. SP No. 90828.

CA-G.R. SP No. 87931 filed by Celestial was heard by the 12th Division of the CA; while Blue Ridges CA-G.R. SP No.
90828 was heard by the Special 10th Division. Ironically, the two divisions rendered two (2) diametrically opposing decisions.

The Ruling of the Court of Appeals Twelfth Division

On April 15, 2005, in CA-G.R. SP No. 87931, the CA 12th Division affirmed the November 26, 2004 MAB Resolution which
declared Macroasias seven mining lease contracts as subsisting; rejected Blue Ridges claim for preferential right over said mining
claims; and upheld the exclusive authority of the DENR Secretary to approve, cancel, and revoke mineral agreements. The CA also
denied Celestials Motion for Reconsideration[28] of the assailed August 3, 2005 Resolution.[29]

Hence, Celestial filed its Petition for Review on Certiorari[30] docketed as G.R. No. 169080, before this Court.

The Ruling of the Court of Appeals Special Tenth Division

On May 18, 2006, the CA Special 10th Division in CA-G.R. SP No. 90828 granted Blue Ridges petition; reversed and set
aside the November 26, 2004 and July 12, 2005 Resolutions of the MAB; and reinstated the October 24, 2000 Decision in MAB
Case Nos. 056-97 and 057-97. The Special Tenth Division canceled Macroasias lease contracts; granted Blue Ridge prior and
preferential rights; and treated the cancellation of a mining lease agreement as a mining dispute within the exclusive jurisdiction of
the POA under Sec. 77 of RA 7942, explaining that the power to resolve mining disputes, which is the greater power, necessarily
includes the lesser power to cancel mining agreements.
 On February 20, 2006, Celestial filed a Most Urgent Motion for Issuance of a Temporary Restraining Order/Preliminary
Prohibitory Injunction/Mandatory Injunction[31] to defer and preclude the issuance of MPSA to Macroasia by the MGB and the
DENR Secretary. We denied this motion in our February 22, 2006 Resolution.[32]

Upon inquiry with the DENR, Blue Ridge discovered that sometime in December 2005 two MPSAs, duly approved and
signed by the DENR Secretary, had been issued in favor of Macroasia. Thus, we have the instant Petition for Certiorari[33] filed
by Blue Ridge docketed as G.R. No. 172936 under Rule 65, seeking to invalidate the two MPSAs issued to Macroasia.

In the meantime, on June 7, 2006, Celestial filed its Motion for Partial Reconsideration[34] of the May 18, 2006 CA Decision in
CA-G.R. SP No. 90828, while Macroasia filed its motion for reconsideration of the same CA decision on July 7, 2006. The motions
were denied in the assailed January 19, 2007 CA Resolution. Hence, on March 8, 2007, Celestial filed the third petition[35] docketed
as G.R. No. 176226, assailing the CAs May 18, 2006 Decision and January 19, 2007 Resolution, insofar as these granted Blue
Ridges prior and preferential rights. While on March 9, 2007, Macroasia filed the fourth petition[36] docketed as G.R. No. 176319,
also assailing the CAs May 18, 2006 Decision and January 19, 2007 Resolution.

The Issues

In G.R. No. 169080, petitioner Celestial raises the following issues for our consideration:

(1) Whether or not Macroasia, for reasons of public policy is estopped from assailing the alleged lack of
jurisdiction of the Panel of Arbitrators and the Mines Adjudication Board only after receiving an adverse judgment
therefrom? [sic]

(2) Whether or not it is only the Secretary of the DENR who has the jurisdiction to cancel mining contracts and
privileges? [sic]

(3) Whether or not a petition for the cancellation of a mining lease contract or privilege is a mining dispute within the
meaning of the law? [sic]
(4) Whether or not Infantas (Macroasia) mining lease contract areas were deemed abandoned warranting the
cancellation of the lease contracts and the opening of the areas to other qualified applicants? [sic]
(5) Whether or not Macroasia/Infanta had lost its right to participate in this case after it failed to seasonably file
its appeal and after its lease contracts had been declared abandoned and expired without having been renewed
by the government? [sic]

(6) Whether or not Celestial has the preferential right to apply for the 23 DE LARA claims which were included in
Infantas (Macroasia) expired lease contract (LLC-V-941) and the other areas declared as lapsed or abandoned
[37]
by MGB-Region 4 and the Panel of Arbitrators? [sic]

In G.R. No. 172936, petitioner Blue Ridge raises the following grounds for the allowance of the petition:

At the outset, the instant petition must be given due course and taken cognizance of by the Honorable Court considering that
exceptional and compelling circumstances justify the availment of the instant petition and the call for the exercise of the
Honorable Courts primary jurisdiction.

A. The exploration, development and utilization of minerals, petroleum and other mineral oils are imbued with
public interest. The action of then Secretary Defensor, maintained and continued by public respondent Secretary
Reyes, was tainted with grave abuse of discretion, has far-reaching consequences because of the magnitude of the
effect created thereby.

B. The issues in the instant petition have already been put to fore by Celestial with the First Division of the
Honorable Court, and hence, this circumstance justifies the cognizance by the Honorable Court of the instant petition.

II

It was grave abuse of discretion amounting to lack and/or excess of jurisdiction for then Secretary Defensor to have issued
the subject MPSAs in favor of private respondent Macroasia, considering that:

A. Non-compliance of the mandatory requirements by private respondent Macroasia prior to approval of the subject
MPSAs should have precluded then Secretary Defensor from approving subject MPSAs.
B. Petitioner Blue Ridge has the prior and preferential right to file its mining application over the mining claims
covered by the subject MPSAs, pursuant to the Decision dated 24 October 2000 of the Board and as affirmed by
the Decision dated 18 May 2006 of the Court of Appeals in CA-G.R. SP No. 90828.[38]
In G.R. No. 176226, petitioner Celestial ascribes the following errors to the CA for our consideration:

(1) That in reinstating and adopting as its own the Decision of the Mine Adjudication Board affirming the abandonment
and cancellation of the mining areas/claims of Macroasia (Infanta) but awarding the prior or preferential rights to Blue
Ridge, the Hon. Court of Appeals had decided a question of substance in a way not in accord with the Law (RA 7942) or
with the applicable decisions of the Supreme Court; in other words, errors of law had been committed by the Hon. Court of
Appeals in granting preferential rights to Blue Ridge;

(2) That the Hon. Court of Appeals has so far departed from the accepted and usual course of judicial proceedings or so
far sanctioned such departure by the Mines Adjudication Board in its Decision of May 18, 2006 and Resolution of January
19, 2007 because:

(A) The findings of fact of the Hon. Court of Appeals are contradictory or inconsistent with the findings of the
Panel of Arbitrators;

(B) There is grave abuse of discretion on the part of the Hon. Court of Appeals in its appreciation of the facts,
the evidence and the law thereby leading it to make the erroneous conclusion that Blue Ridge, not Celestial, is entitled
to the Award of prior/preferential rights over the mining areas declared as abandoned by Macroasia;

(C) There is likewise, a grave abuse of discretion on the part of the Hon. Court of Appeals in that the said
Court did not even consider some of the issues raised by Celestial;

(D) That the findings of the Hon. Court of Appeals are mere conclusions not supported by substantial evidence
and without citation of the specific evidence upon which they are based; they were arrived at arbitrarily or in
disregard of contradiction of the evidence on record and findings of the Panel of Arbitrators in the Resolution of
September 1, 1997;

(E) That the findings of the Hon. Court of Appeals are premised on the absence of evidence but such findings
are contradicted by the evidence on record and are violative of the provisions of RA 7942 and its Implementing Rules
and Regulations.[39]
In G.R. No. 176319, petitioner Macroasia raises the following grounds for the allowance of the petition:
I.

The Court of Appeals (Special Tenth Division) should have dismissed the Petition of Blue Ridge outright since the issues,
facts and matters involved in the said Petition are identical to those which had already been painstakingly passed upon,
reviewed and resolved by the Court of Appeals Twelfth Division in CA-G.R. SP No. 87931

II.

The Court of Appeals (Special Tenth Division) gravely erred in denying Macroasias Motion to Inhibit Associate Justice
Rosmari Carandang from hearing and deciding the Petition

III.

There were no factual nor legal bases for the Court of Appeals to rule that Macroasia had waived its right to question the
jurisdiction of the Mines Adjudication Board

IV.

Republic Act No. 7942 contains provisions which unequivocally indicate that only the Secretary of the Department of
Environment and Natural Resources has the power and authority to cancel mining lease agreements

V.

The Court of Appeals (Special Tenth Division) gravely erred in perfunctorily transferring Macroasias mining lease
agreements to Blue Ridge without observing the required procedure nor providing any basis therefor[40]

The Courts Ruling

 The petitions under G.R. Nos. 169080, 172936, and 176226 are bereft of merit, while the petition under G.R. No. 176319 is
meritorious.

The pith of the controversy, upon which the other issues are hinged is, who has authority and jurisdiction to cancel existing
mineral agreements under RA 7942 in relation to PD 463 and pertinent rules and regulations.

G.R. Nos. 169080, 176226 and 176319

We will jointly tackle G.R. Nos. 169080, 176266, and 176319 as the issues and arguments of these three are inextricably
intertwined.

Core Issue: Jurisdiction over Cancellation of Mineral Agreements

Petitioner Celestial maintains that while the jurisdiction to approve mining lease contracts or mineral agreements is conferred
on the DENR Secretary, Sec. 77(a) of RA 7942 by implication granted to the POA and MAB the authority to cancel existing mining
lease contracts or mineral agreements.

On the other hand, respondent Macroasia strongly asserts that it is the DENR Secretary who has the exclusive and primary
jurisdiction to grant and cancel existing mining lease contracts; thus, the POA and MAB have no jurisdiction to cancel much less to
grant any preferential rights to other mining firms.

Before we resolve this core issue of jurisdiction over cancellation of mining lease contracts, we first need to look back at
previous mining laws pertinent to this issue.

Under PD 463, The Mineral Resources Development Decree of 1974, which took effect on May 17, 1974, applications for
lease of mining claims were required to be filed with the Director of the Bureau of Mines, within two (2) days from the date of their
recording.[41] Sec. 40 of PD 463 provided that if no adverse claim was filed within (15) days after the first date of publication, it was
conclusively presumed that no adverse claim existed and thereafter no objection from third parties to the grant of the lease could be
heard, except protests pending at the time of publication. The Secretary would then approve and issue the corresponding mining
lease contract. In case of any protest or adverse claim relating to any mining claim and lease application, Secs. 48 and 50 of PD 463
prescribed the procedure. Under Sec. 48, the protest should be filed with the Bureau of Mines. Under Sec. 50, any party not satisfied
with the decision or order of the Director could, within five (5) days from receipt of the decision or order, appeal to the Secretary.
The decisions of the Secretary were likewise appealable within five (5) days from receipts by the affected party to the President of
the Philippines whose decision shall be final and executory. PD 463 was, however, silent as to who was authorized to cancel the
mineral agreements.

On July 10, 1987, President Corazon C. Aquino issued Executive Order No. (EO) 211. Under Sec. 2 of EO 211, the
processing, evaluation, and approval of all mining applications, declarations of locations, operating agreements, and service
contracts were governed by PD 463, as amended. EO 211 likewise did not contain any provision on the authority to cancel operating
agreements and service contracts.

On July 25, 1987, EO 279 was issued by President Aquino. It authorized the DENR Secretary to negotiate and enter into, for
and in behalf of the Government, joint venture, co-production, or production-sharing agreements for the exploration, development,
and utilization of mineral resources with any Filipino citizen, corporation, or association, at least 60% of whose capital was owned
by Filipino citizens.[42] The contract or agreement was subject to the approval of the President. [43] With respect to contracts of
foreign-owned corporations or foreign investors involving either technical or financial assistance for large-scale exploration,
development, and utilization of minerals, the DENR Secretary could recommend approval of said contracts to the President.[44] EO
279 provided that PD 463 and its implementing rules and regulations, which were not inconsistent with EO 279, continued in force
and effect.[45] Again, EO 279 was silent on the authority to cancel mineral agreements.

RA 7942, The Philippine Mining Act of 1995 enacted on March 3, 1995, repealed the provisions of PD 463 inconsistent with
RA 7942. Unlike PD 463, where the application was filed with the Bureau of Mines Director, the applications for mineral
agreements are now required to be filed with the Regional Director as provided by Sec. 29 of RA 7942. The proper filing gave the
proponent the prior right to be approved by the Secretary and thereafter to be submitted to the President. The President shall provide
a list to Congress of every approved mineral agreement within 30 days from its approval by the Secretary. Again, RA 7942 is silent
on who has authority to cancel the agreement.

Compared to PD 463 where disputes were decided by the Bureau of Mines Director whose decisions were appealable to the
DENR Secretary and then to the President, RA 7942 now provides for the creation of quasi-judicial bodies (POA and MAB) that
would have jurisdiction over conflicts arising from the applications and mineral agreements. Secs. 77, 78, and 79 lay down the
procedure, thus:

SEC. 77. Panel of Arbitrators.There shall be a panel of arbitrators in the regional office of the Department composed of three (3)
members, two (2) of whom must be members of the Philippine Bar in good standing and one [1] licensed mining engineer or a professional
in a related field, and duly designated by the Secretary as recommended by the Mines and Geosciences Bureau Director. Those designated
as members of the panel shall serve as such in addition to their work in the Department without receiving any additional compensation. As
much as practicable, said members shall come from the different bureaus of the Department in the region. The presiding officer thereof
shall be selected by the drawing of lots. His tenure as presiding officer shall be on a yearly basis. The members of the panel shall perform
their duties and obligations in hearing and deciding cases until their designation is withdrawn or revoked by the Secretary. Within thirty
(30) working days, after the submission of the case by the parties for decision, the panel shall have exclusive and original jurisdiction to
hear and decide on the following:

(a) Disputes involving rights to mining areas;

(b) Disputes involving mineral agreements or permits;

(c) Disputes involving surface owners, occupants and claimholders/concessionaires; and

(d) Disputes pending before the Bureau and the Department at the date of the effectivity of this Act.

SEC. 78. Appellate Jurisdiction.The decision or order of the panel of arbitrators may be appealed by the party not satisfied thereto to the
Mines Adjudication Board within fifteen (15) days from receipt thereof which must decide the case within thirty (30) days from submission
thereof for decision.

SEC. 79. Mines Adjudication Board.The Mines Adjudication Board shall be composed of three (3) members. The Secretary shall be the
chairman with the Director of the Mines and Geosciences Bureau and the Undersecretary for Operations of the Department as members
thereof.

xxxx

A petition for review by certiorari and question of law may be filed by the aggrieved party with the Supreme Court within
thirty (30) days from receipt of the order or decision of the Board.

RA 7942 is also silent as to who is empowered to cancel existing lease contracts and mineral agreements.
 Meanwhile, in Southeast Mindanao Gold Mining Corp. v. MAB, we explained that the decision of the MAB can first be
appealed, via a petition for review, to the CA before elevating the case to this Court.[46]

After a scrutiny of the provisions of PD 463, EO 211, EO 279, RA 7942 and its implementing rules and regulations, executive
issuances, and case law, we rule that the DENR Secretary, not the POA, has the jurisdiction to cancel existing mineral lease
contracts or mineral agreements based on the following reasons:

1. The power of the DENR Secretary to cancel mineral agreements emanates from his administrative authority,
supervision, management, and control over mineral resources under Chapter I, Title XIV of Book IV of the Revised Administrative
Code of 1987, viz:

Chapter 1General Provisions

Section 1. Declaration of Policy.(1) The State shall ensure, for the benefit of the Filipino people, the full
exploration and development as well as the judicious disposition, utilization, management, renewal and conservation of
the countrys forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other natural resources x x x

Sec. 2. Mandate.(1) The Department of Environment and Natural Resources shall be primarily responsible
for the implementation of the foregoing policy. (2) It shall, subject to law and higher authority, be in charge of
carrying out the States constitutional mandate to control and supervise the exploration, development, utilization,
and conservation of the countrys natural resources.

xxxx

Sec. 4. Powers and Functions.The Department shall:

xxxx

(2) Formulate, implement and supervise the implementation of the governments policies, plans, and
programs pertaining to the management, conservation, development, use and replenishment of the countrys natural
resources;
 xxxx

(4) Exercise supervision and control over forest lands, alienable and disposable public lands, mineral
resources x x x

xxxx

(12) Regulate the development, disposition, extraction, exploration and use of the countrys forest, land,
water and mineral resources;

(13) Assume responsibility for the assessment, development, protection, licensing and regulation as provided
for by law, where applicable, of all energy and natural resources; theregulation and monitoring of service contractors,
licensees, lessees, and permit for the extraction, exploration, development and use of natural resources products; x x
x

xxxx

(15) Exercise exclusive jurisdiction on the management and disposition of all lands of the public domain x x
x

Chapter 2The Department Proper

xxxx

Sec. 8. The Secretary.The Secretary shall:

xxxx

(3) Promulgate rules, regulations and other issuances necessary in carrying out the Departments
mandate, objectives, policies, plans, programs and projects.

(4) Exercise supervision and control over all functions and activities of the Department;
 (5) Delegate authority for the performance of any administrative or substantive function to subordinate officials
of the Department x x x (Emphasis supplied.)

It is the DENR, through the Secretary, that manages, supervises, and regulates the use and development of all mineral
resources of the country. It has exclusive jurisdiction over the management of all lands of public domain, which covers mineral
resources and deposits from said lands. It has the power to oversee, supervise, and police our natural resources which include
mineral resources. Derived from the broad and explicit powers of the DENR and its Secretary under the Administrative Code of
1987 is the power to approve mineral agreements and necessarily to cancel or cause to cancel said agreements.

2. RA 7942 confers to the DENR Secretary specific authority over mineral resources.

Secs. 8 and 29 of RA 7942 pertinently provide:

SEC. 8. Authority of the Department.The Department shall be the primary government agency responsible for the
conservation, management, development, and proper use of the States mineral resources including those in reservations,
watershed areas, and lands of the public domain. The Secretary shall have the authority to enter into mineral
agreements on behalf of the Government upon the recommendation of the Director, promulgate such rules and
regulations as may be necessary to implement the intent and provisions of this Act.

SEC. 29. Filing and approval of Mineral Agreements.x x x.

The filing of a proposal for a mineral agreement shall give the proponent the prior right to areas covered by the
same. The proposed mineral agreement will be approved by the Secretary and copies thereof shall be submitted to the
President. Thereafter, the President shall provide a list to Congress of every approved mineral agreement within thirty (30)
days from its approval by the Secretary. (Emphasis supplied.)
 Sec. 29 is a carry over of Sec. 40 of PD 463 which granted jurisdiction to the DENR Secretary to approve mining lease
contracts on behalf of the government, thus:

SEC. 40. Issuance of Mining Lease Contract.If no adverse claim is filed within fifteen (15) days after the first date
of publication, it shall be conclusively presumed that no such adverse claim exists and thereafter no objection from third
parties to the grant of the lease shall be heard, except protest pending at the time of publication, and the Secretary shall
approve and issue the corresponding mining lease x x x.

To enforce PD 463, the CMAO containing the rules and regulations implementing PD 463 was issued. Sec. 44 of the CMAO
provides:

SEC. 44. Procedure for Cancellation.Before any mining lease contract is cancelled for any cause enumerated in Section
43 above, the mining lessee shall first be notified in writing of such cause or causes, and shall be given an opportunity to be
heard, and to show cause why the lease shall not be cancelled.

If, upon investigation, the Secretary shall find the lessee to be in default, the former may warn the lessee,
suspend his operations or cancel the lease contract (emphasis supplied).
Sec. 4 of EO 279 provided that the provisions of PD 463 and its implementing rules and regulations, not inconsistent with the
executive order, continue in force and effect.

When RA 7942 took effect on March 3, 1995, there was no provision on who could cancel mineral agreements. However,
since the aforequoted Sec. 44 of the CMAO implementing PD 463 was not repealed by RA 7942 and DENR AO 96-40, not being
contrary to any of the provisions in them, then it follows that Sec. 44 serves as basis for the DENR Secretarys authority to cancel
mineral agreements.

Since the DENR Secretary had the power to approve and cancel mineral agreements under PD 463, and the power to cancel
them under the CMAO implementing PD 463, EO 211, and EO 279, then there was no recall of the power of the DENR Secretary
under RA 7942. Historically, the DENR Secretary has the express power to approve mineral agreements or contracts and the
implied power to cancel said agreements.
 It is a well-established principle that in the interpretation of an ambiguous provision of law, the history of the enactment of
the law may be used as an extrinsic aid to determine the import of the legal provision or the law. [47] History of the enactment of the
statute constitutes prior laws on the same subject matter. Legislative history necessitates review of the origin, antecedents and
derivation of the law in question to discover the legislative purpose or intent. [48] It can be assumed that the new legislation has
been enacted as continuation of the existing legislative policy or as a new effort to perpetuate it or further advance it.[49]

We rule, therefore, that based on the grant of implied power to terminate mining or mineral contracts under previous laws or
executive issuances like PD 463, EO 211, and EO 279, RA 7942 should be construed as a continuation of the legislative intent to
authorize the DENR Secretary to cancel mineral agreements on account of violations of the terms and conditions thereof.

3. Under RA 7942, the power of control and supervision of the DENR Secretary over the MGB to cancel or recommend
cancellation of mineral rights clearly demonstrates the authority of the DENR Secretary to cancel or approve the cancellation of
mineral agreements.

Under Sec. 9 of RA 7942, the MGB was given the power of direct supervision of mineral lands and resources, thus:

Sec. 9. Authority of the Bureau.The Bureau shall have direct charge in the administration and disposition of
mineral lands and mineral resources and shall undertake geological, mining, metallurgical, chemical, and other
researches as well as geological and mineral exploration surveys. The Director shall recommend to the Secretary the
granting of mineral agreements to duly qualified persons and shall monitor the compliance by the contractor of the
terms and conditions of the mineral agreements. The Bureau may confiscate surety, performance and guaranty bonds
posted through an order to be promulgated by the Director. The Director may deputize, when necessary, any member or
unit of the Philippine National Police, barangay, duly registered nongovernmental organization (NGO) or any qualified
person to police all mining activities. (Emphasis supplied.)

Corollary to the power of the MGB Director to recommend approval of mineral agreements is his power to cancel or
recommend cancellation of mining rights covered by said agreements under Sec. 7 of DENR AO 96-40, containing the revised
Implementing Rules and Regulations of RA 7942. Sec. 7 reads:
 Sec. 7. Organization and Authority of the Bureau.

xxxx

The Bureau shall have the following authority, among others:

a. To have direct charge in the administration and disposition of mineral land and mineral resources;

xxxx

d. To recommend to the Secretary the granting of mineral agreements or to endorse to the Secretary for action
by the President the grant of FTAAs [Financial and Technical Assistance Agreements], in favor of qualified persons and to
monitor compliance by the Contractor with the terms and conditions of the mineral agreements and FTAAs.

e. To cancel or to recommend cancellation after due process, mining rights, mining applications and mining
claims for non-compliance with pertinent laws, rules and regulations.

It is explicit from the foregoing provision that the DENR Secretary has the authority to cancel mineral agreements based on
the recommendation of the MGB Director. As a matter of fact, the power to cancel mining rights can even be delegated by the
DENR Secretary to the MGB Director. Clearly, it is the Secretary, not the POA, that has authority and jurisdiction over cancellation
of existing mining contracts or mineral agreements.

4. The DENR Secretarys power to cancel mining rights or agreements through the MGB can be inferred from Sec. 230,
Chapter XXIV of DENR AO 96-40 on cancellation, revocation, and termination of a permit/mineral agreement/FTAA. Sec. 230
provides:

Section 230. Grounds

The following grounds for cancellation revocation and termination of a Mining Permit Mineral Agreement/FTAA.
 a. Violation of any of the terms and conditions of the Permits or Agreements;

b. Nonpayment of taxes and fees due the government for two (2) consecutive years; and

c. Falsehood or omission of facts in the application for exploration [or Mining] Permit Mineral Agreement/FTAA or other
permits which may later, change or affect substantially the facts set forth in said statements.

Though Sec. 230 is silent as to who can order the cancellation, revocation, and termination of a permit/mineral
agreement/FTAA, it has to be correlated with the power of the MGB under Sec. 7 of AO 96-40 to cancel or to recommend
cancellation, after due process, mining rights, mining applications and mining claims for noncompliance with pertinent laws, rules
and regulations. As the MGB is under the supervision of the DENR Secretary, then the logical conclusion is that it is the DENR
Secretary who can cancel the mineral agreements and not the POA nor the MAB.

5. Celestial and Blue Ridge are not unaware of the stipulations in the Mining Lease Contract Nos. V-1050 and MRD-
[50]
52, the cancellation of which they sought from the POA. It is clear from said lease contracts that the parties are the Republic of
the Philippines represented by the Secretary of Agriculture and Natural Resources (now DENR Secretary) as lessor, and Infanta
(Macroasia) as lessee. Paragraph 18 of said lease contracts provides:

Whenever the LESSEE fails to comply with any provision of [PD 463, and] Commonwealth Acts Nos. 137, 466 and
470, [both as amended,] and/or the rules and regulations promulgated thereunder, or any of the covenants therein, the
LESSOR may declare this lease cancelled and, after having given thirty (30) days notice in writing to the LESSEE, may
enter and take possession of the said premises, and said lessee shall be liable for all unpaid rentals, royalties and taxes due
the Government on the lease up to the time of the forfeiture or cancellation, in which event, the LESSEE hereby covenants
and agrees to give up the possession of the property leased. (Emphasis supplied.)

Thus, the government represented by the then Secretary of Agriculture and Natural Resources (now the DENR Secretary) has
the power to cancel the lease contracts for violations of existing laws, rules and regulations and the terms and conditions of the
contracts. Celestial and Blue Ridge are now estopped from challenging the power and authority of the DENR Secretary to cancel
mineral agreements.

However, Celestial and Blue Ridge insist that the power to cancel mineral agreements is also lodged with the POA under the
explicit provisions of Sec. 77 of RA 7942.

This postulation is incorrect.

Sec. 77 of RA 7942 lays down the jurisdiction of POA, to wit:

Within thirty (30) days, after the submission of the case by the parties for the decision, the panel shall have exclusive and
original jurisdiction to hear and decide the following:

(a) Disputes involving rights to mining areas

(b) Disputes involving mineral agreements or permits

The phrase disputes involving rights to mining areas refers to any adverse claim, protest, or opposition to an application for
mineral agreement. The POA therefore has the jurisdiction to resolve any adverse claim, protest, or opposition to a pending
application for a mineral agreement filed with the concerned Regional Office of the MGB. This is clear from Secs. 38 and 41 of
DENR AO 96-40, which provide:

Sec. 38.

xxxx

Within thirty (30) calendar days from the last date of publication/posting/radio announcements, the authorized
officer(s) of the concerned office(s) shall issue a certification(s) that the publication/posting/radio announcement have been
 complied with. Any adverse claim, protest or opposition shall be filed directly, within thirty (30) calendar days from
the last date of publication/posting/radio announcement, with the concerned Regional Office or through any
concerned PENRO or CENRO for filing in the concerned Regional Office for purposes of its resolution by the Panel
of Arbitrators pursuant to the provisions of this Act and these implementing rules and regulations. Upon final
resolution of any adverse claim, protest or opposition, the Panel of Arbitrators shall likewise issue a certification to
that effect within five (5) working days from the date of finality of resolution thereof. Where there is no adverse
claim, protest or opposition, the Panel of Arbitrators shall likewise issue a Certification to that effect within five
working days therefrom.

xxxx

No Mineral Agreement shall be approved unless the requirements under this Section are fully complied with
and any adverse claim/protest/opposition is finally resolved by the Panel of Arbitrators.

Sec. 41.

xxxx

Within fifteen (15) working days from the receipt of the Certification issued by the Panel of Arbitrators as
provided in Section 38 hereof, the concerned Regional Director shall initially evaluate the Mineral Agreement
applications in areas outside Mineral reservations. He/She shall thereafter endorse his/her findings to the Bureau for
further evaluation by the Director within fifteen (15) working days from receipt of forwarded
documents. Thereafter, the Director shall endorse the same to the secretary for consideration/approval within fifteen
working days from receipt of such endorsement.

In case of Mineral Agreement applications in areas with Mineral Reservations, within fifteen (15) working days
from receipt of the Certification issued by the Panel of Arbitrators as provided for in Section 38 hereof, the same
shall be evaluated and endorsed by the Director to the Secretary for consideration/approval within fifteen days from
receipt of such endorsement. (Emphasis supplied.)

It has been made clear from the aforecited provisions that the disputes involving rights to mining areas under Sec. 77(a)
specifically refer only to those disputes relative to the applications for a mineral agreement or conferment of mining rights.
 The jurisdiction of the POA over adverse claims, protest, or oppositions to a mining right application is further elucidated by
Secs. 219 and 43 of DENR AO 95-936, which read:

Sec. 219. Filing of Adverse Claims/Conflicts/Oppositions.Notwithstanding the provisions of Sections 28, 43 and
57 above, any adverse claim, protest or opposition specified in said sections may also be filed directly with the Panel
of Arbitrators within the concerned periods for filing such claim, protest or opposition as specified in said Sections.

Sec. 43. Publication/Posting of Mineral Agreement Application.

xxxx

The Regional Director or concerned Regional Director shall also cause the posting of the application on the bulletin
boards of the Bureau, concerned Regional office(s) and in the concerned province(s) and municipality(ies), copy furnished
the barangays where the proposed contract area is located once a week for two (2) consecutive weeks in a language
generally understood in the locality. After forty-five (45) days from the last date of publication/posting has been made and
no adverse claim, protest or opposition was filed within the said forty-five (45) days, the concerned offices shall issue a
certification that publication/posting has been made and that no adverse claim, protest or opposition of whatever nature has
been filed. On the other hand, if there be any adverse claim, protest or opposition, the same shall be filed within
forty-five (45) days from the last date of publication/posting, with the Regional Offices concerned, or through the
Departments Community Environment and Natural Resources Officers (CENRO) or Provincial Environment and
Natural Resources Officers (PENRO), to be filed at the Regional Office for resolution of the Panel of Arbitrators.
However previously published valid and subsisting mining claims are exempted from posted/posting required under this
Section.

No mineral agreement shall be approved unless the requirements under this section are fully complied with
and any opposition/adverse claim is dealt with in writing by the Director and resolved by the Panel of
Arbitrators. (Emphasis supplied.)

These provisions lead us to conclude that the power of the POA to resolve any adverse claim, opposition, or protest relative to
mining rights under Sec. 77(a) of RA 7942 is confined only to adverse claims, conflicts and oppositions relating to applications for
the grant of mineral rights. POAs jurisdiction is confined only to resolutions of such adverse claims, conflicts and oppositions and
it has no authority to approve or reject said applications. Such power is vested in the DENR Secretary upon recommendation of the
MGB Director. Clearly, POAs jurisdiction over disputes involving rights to mining areas has nothing to do with the cancellation
of existing mineral agreements.

On the other hand, Celestial and Blue Ridge contend that POA has jurisdiction over their petitions for the cancellation of
Macroasias lease agreements banking on POAs jurisdiction over disputes involving mineral agreements or permits under Sec. 77
(b) of RA 7942.

Such position is bereft of merit.

As earlier discussed, the DENR Secretary, by virtue of his powers as administrative head of his department in charge of the
management and supervision of the natural resources of the country under the 1987 Administrative Code, RA 7942, and other laws,
rules, and regulations, can cancel a mineral agreement for violation of its terms, even without a petition or request filed for its
cancellation, provided there is compliance with due process. Since the cancellation of the mineral agreement is approved by the
DENR Secretary, then the recourse of the contractor is to elevate the matter to the OP pursuant to AO 18, Series of 1987 but not with
the POA.

Matched with the legal provisions empowering the DENR Secretary to cancel a mineral agreement is Sec. 77 (b) of RA 7942
which grants POA jurisdiction over disputes involving mineral agreements.

A dispute is defined as a conflict or controversy; a conflict of claims or rights; an assertion of a right, claim or demand on one
side; met by contrary claims or allegations on the other.[51] It is synonymous to a cause of action which is an act or omission by
which a party violates a right of another.[52]

A petition or complaint originating from a dispute can be filed or initiated only by a real party-in-interest. The rules of court
define a real party-in-interest as the party who stands to be benefited or injured by the judgment in the suit or the party entitled to
the avails of the suit.[53] Every action, therefore, can only be prosecuted in the name of the real party-in-interest.[54] It has been
explained that a real party-in-interest plaintiff is one who has a legal right, while a real party-in-interest-defendant is one who has a
correlative legal obligation whose act or omission violates the legal right of the former. [55]
 On the other hand, interest means material interest, an interest in issue and to be affected by the decree, as distinguished from
mere interest in the question involved, or a mere incidental interest. It is settled in this jurisdiction that one having no right or
interest to protect cannot invoke the jurisdiction of the court as a party-plaintiff in an action.[56] Real interest is defined as a
present substantial interest, as distinguished from a mere expectancy, or a future, contingent, subordinate or consequential
interest.[57]

From the foregoing, a petition for the cancellation of an existing mineral agreement covering an area applied for by an
applicant based on the alleged violation of any of the terms thereof, is not a dispute involving a mineral agreement under Sec. 77
(b) of RA 7942. It does not pertain to a violation by a party of the right of another. The applicant is not a real party-in-interest as he
does not have a material or substantial interest in the mineral agreement but only a prospective or expectant right or interest in the
mining area. He has no legal right to such mining claim and hence no dispute can arise between the applicant and the parties to the
mineral agreement. The court rules therefore that a petition for cancellation of a mineral agreement anchored on the breach thereof
even if filed by an applicant to a mining claim, like Celestial and Blue Ridge, falls within the jurisdiction of the DENR Secretary and
not POA. Such petition is excluded from the coverage of the POAs jurisdiction over disputes involving mineral agreements under
Sec. 77 (b) of RA 7942.

Macroasia not estopped from raising the issue of jurisdiction on appeal

On the related issue of estoppel, petitioner Celestial argues that Macroasia is estopped from raising and questioning the issue
of the jurisdiction of the POA and MAB over the petition for cancellation of its mining lease contracts, when Macroasia raised it
only in its Supplemental Motion for Reconsideration.

We rule that the principle of estoppel does not apply.

Indeed, Macroasia was not the one that initiated the instant case before the POA, and thus was not the one that invoked the
jurisdiction of the POA. Hence, on appeal, Macroasia is not precluded from raising the issue of jurisdiction as it may be invoked
even on appeal.[58] As a matter of fact, a party can raise the issue of jurisdiction at any stage of the proceedings.
 Petitioner Celestials reliance on Villela v. Gozun[59] to support the contention that the POA has jurisdiction to hear and decide
a petition to cancel existing mining lease contracts, is misplaced. In said case, we dismissed the petition on the ground of non-
exhaustion of administrative remedies and disregarded judicial hierarchy as no compelling reason was shown to warrant
otherwise. While we pointed out the authority of the POA, there was no categorical pronouncement on the jurisdictional issue.

No valid pronouncement of abandonment due to lack of jurisdiction over petition to cancel

As we are not a trier of facts, we need not make any finding on the various investigations done by the MGB and MAB on the
issue of Macroasias non-compliance with its work obligations and nonpayment of taxes and fees. Verily, the law does not impose
automatic cancellation of an existing mining lease contract, as it is a question of fact which must be determined by the MGB which
can recommend the cancellation of the mineral or lease agreements to the DENR Secretary. Be that as it may, since the POA and
MAB have no jurisdiction over the petition for cancellation of existing mining lease contracts of Macroasia, they could not have
made any binding pronouncement that Macroasia had indeed abandoned the subject mining claims. Besides, it is the DENR
Secretary who has the authority to cancel Macroasias existing mining lease contracts whether on grounds of abandonment or any
valid grounds for cancellation.

Decision in CA-G.R. SP No. 90828 not in accord with the law

With our resolution of the issue on the lack of jurisdiction of the POA and the MAB over petitions to cancel existing mining
lease contracts or mineral agreements, it is thus clear that the May 18, 2006 Decision in CA-G.R. SP No. 90828 must be nullified for
being not in accord with the law and the April 15, 2005 Decision in CA-G.R. SP No. 87931 must be upheld.

Notwithstanding the nullification of the May 18, 2006 Decision of the Special Tenth Division in CA-G.R. SP No. 90828, the
rendition of two conflicting decisions of the two CA Divisions over the same challenged resolutions of the MAB should be
avoided in the future as this is anathema to stability of judicial decisions and orderly administration of justice.

The chronology of events reveals the following:

 1. January 10, 2005 petitioner Celestial filed its petition docketed as CA-G.R. SP No. 87931 with the CA.

2. April 15, 2005 the CA through its Twelfth Division rendered its Decision in CA-G.R. SP No. 87931 affirming the
November 26, 2004 MAB Resolution.

3. July 12, 2005 respondent Blue Ridge filed its petition docketed as CA-G.R. SP No. 90828 with the CA. It is clear that
the Blue Ridge petition was filed with the CA three months after the decision in CA-G.R. SP No. 87931 was promulgated.

4. May 18, 2006 the CA through its Special Tenth Division rendered its Decision setting aside the November 26,
2004 and July 12, 2005 Resolutions of the MAB and reinstating the October 24, 2000 MAB Decision.

From these facts, the CA Special Tenth Division should have ordered the consolidation of the petition in CA-G.R. SP No.
90828 by CA-G.R. SP No. 87931 pursuant to the Internal Rules of the CA, the latter having the earlier docket number. Had it done
so, then the occurrence of the conflicting decisions could have been prevented. The CA Special Tenth Division should have abided
by our ruling in Nacuray v. NLRC, where we held, Consequently, a division cannot and should not review a case already passed
upon by another Division of this Court. It is only proper, to allow the case to take its rest after having attained finality.[60]

The CA should take the appropriate steps, including the adoption or amendment of the rules, to see to it that cases or petitions
arising from the same questioned decision, order, or resolution are consolidated to steer clear of contrary or opposing decisions of
the different CA Divisions and ensure that incidents of similar nature will not be replicated.

G.R. No. 172936

No showing that the DENR Secretary gravely abused his discretion

Now, going to the substance of the petition in G.R. No. 172936. A scrutiny of the records shows that the DENR Secretary did
not gravely abuse his discretion in approving and signing MPSA Nos. 220-2005-IVB and 221-2005-IVB in favor of Macroasia.
 Petitioner Blue Ridge anchors its rights on the May 18, 2006 Decision in CA-G.R. SP No. 90828, which we have
unfortunately struck down. Blue Ridges argument in assailing the approval and issuance of the subject MPSAs that it has been
accorded preferential right by the CA has no leg to stand on.

The October 24, 2000 MAB Decision, nullified by the subsequent November 26, 2004 Resolution, is unequivocal that Blue
Ridge was granted only prior and preferential rights to FILE its mining application over the same mining claims.[61] What was
accorded Blue Ridge was only the right to file the mining application but with no assurance that the application will be
recommended for approval by the MGB and finally approved by the DENR Secretary.

Moreover, a preferential right would at most be an inchoate right to be given priority in the grant of a mining agreement. It has
not yet been transformed into a legal and vested right unless approved by the MGB or DENR Secretary. Even if Blue Ridge has a
preferential right over the subject mining claims, it is still within the competence and discretion of the DENR Secretary to grant
mineral agreements to whomever he deems best to pursue the mining claims over and above the preferential status given to Blue
Ridge. Besides, being simply a preferential right, it is ineffective to dissolve the pre-existing or subsisting mining lease contracts of
Macroasia.

The DENR Secretary has full discretion in the grant of mineral agreements

Blue Ridge also argues that the Secretary gravely abused his discretion in approving the subject MPSAs without Macroasia
complying with the mandatory requirements for mineral agreement applications under Sec. 35 of DENR AO 96-40. Petitioner
specifically cited Sec. 36 of DENR AO 96-40 to the effect that no Mineral Agreement shall be approved unless the requirements
under this section are fully complied with and any adverse claim/protest/opposition thereto is finally resolved by the Panel of
Arbitrators. Moreover, Blue Ridge contends that the MPSAs were approved even prior to the issuance of the Compliance
Certificate[62] by the National Commission on Indigenous Peoples under the OP, which is a requisite pre-condition for the issuance
of an MPSA.

We are not persuaded.

 Blue Ridge cites Sec. 38 (not Sec. 36) of DENR AO 96-40 as basis for claiming that then DENR Secretary Defensor
committed grave abuse of discretion in granting MPSA Nos. 220-2005-IVB and 221-2005-IVB to Macroasia. Petitioners
postulation cannot be entertained for the reason that the issuance of the mining agreements was not raised before the MGB Director
and DENR Secretary, nor was it amply presented before the CA. There is even a counter-charge that Blue Ridge has not complied
with the legal requirements for a mining application. The rule is established that questions raised for the first time on appeal before
this Court are not proper and have to be rejected. Furthermore, the resolution of these factual issues would relegate the Court to a
trier of facts. The Blue Ridge plea is hindered by the factual issue bar rule where factual questions are proscribed under Rule 65.
Lastly, there was no exhaustion of administrative remedies before the MGB and DENR. Thus, Blue Ridges petition must fail.

Primary jurisdiction of the DENR Secretary in determining whether to grant or not a mineral agreement

Verily, RA 7942, similar to PD 463, confers exclusive and primary jurisdiction on the DENR Secretary to approve mineral
agreements, which is purely an administrative function within the scope of his powers and authority. In exercising such exclusive
primary jurisdiction, the DENR Secretary, through the MGB, has the best competence to determine to whom mineral agreements are
granted. Settled is the rule that the courts will defer to the decisions of the administrative offices and agencies by reason of their
expertise and experience in the matters assigned to them pursuant to the doctrine of primary jurisdiction. Administrative decisions
on matter within the jurisdiction of administrative bodies are to be respected and can only be set aside on proof of grave abuse of
discretion, fraud, or error of law.[63] Unless it is shown that the then DENR Secretary has acted in a wanton, whimsical, or
oppressive manner, giving undue advantage to a party or for an illegal consideration and similar reasons, this Court cannot look into
or review the wisdom of the exercise of such discretion. Blue Ridge failed in this regard.

Delineation of powers and functions is accorded the three branches of government for the smooth functioning of the different
governmental services. We will not disturb nor interfere in the exercise of purely administrative functions of the executive branch
absent a clear showing of grave abuse of discretion.

Without a restraining order or injunction, litigation will not deter the DENR from exercising its functions
 While it is true that the subject mining claims are under litigation, this does not preclude the DENR and its Secretary from
carrying out their functions and duties without a restraining order or an injunctive writ. Otherwise, public interest and public service
would unduly suffer by mere litigation of particular issues where government interests would be unduly affected. In the instant case,
it must be borne in mind that the government has a stake in the subject mining claims. Also, Macroasia had various valid existing
mining lease contracts over the subject mining lode claims issued by the DENR. Thus, Macroasia has an advantage over Blue
Ridge and Celestial insofar as the administrative aspect of pursuing the mineral agreements is concerned.

WHEREFORE, the petitions under G.R. Nos. 169080, 172936, and 176229 are DISMISSED for lack of merit, while the
petition under G.R. No. 176319 is herebyGRANTED. The assailed April 15, 2005 Decision and August 3, 2005 Resolution of the
CA in CA-G.R. SP No. 87931 are hereby AFFIRMED IN TOTO. And the May 18, 2006 Decision and January 19, 2007
Resolution of the CA in CA-G.R. SP No. 90828 are hereby REVERSED and SET ASIDE. In view of the foregoing considerations,
we find no grave abuse of discretion on the part of the then DENR Secretary in the approval and issuance of MPSA Nos. 220-2005-
IVB and 221-2005-IVB. Costs against Celestial Nickel Mining Exploration Corporation and Blue Ridge Mineral Corporation.

SO ORDERED.

DIDIPIO EARTH-SAVERS MULTI- G.R. No. 157882

PURPOSE ASSOCIATION,
INCORPORATED (DESAMA),
MANUEL BUTIC, CESAR
MARIANO, LAURO ABANCE, BEN
TAYABAN, ANTONIO DINGCOG,
TEDDY B. KIMAYONG, ALONZO Present:
ANANAYO, ANTONIO MALAN-
UYA, JOSE BAHAG, ANDRES PANGANIBAN, C.J.
INLAB, RUFINO LICYAYO, Chairperson,
ALFREDO CULHI, CATALILNA YNARES-SANTIAGO,
INABYUHAN, GUAY DUMMANG, AUSTRIA-MARTINEZ,
GINA PULIDO, EDWIN ANSIBEY, CALLEJO, SR., and
CORAZON SICUAN, LOPEZ CHICO-NAZARIO, JJ.
DUMULAG, FREDDIE AYDINON,
VILMA JOSE, FLORENTINA
MADDAWAT, LINDA DINGCOG,
ELMER SICUAN, GARY ANSIBEY,
JIMMY MADDAWAT, JIMMY
GUAY, ALFREDO CUT-ING,
ANGELINA UDAN, OSCAR INLAB,
JUANITA CUT-ING, ALBERT
PINKIHAN, CECILIA TAYABAN,
CRISTA BINWAK, PEDRO DUGAY,
SR., EDUARDO ANANAYO, ROBIN
INLAB, JR., LORENZO PULIDO,
TOMAS BINWAG, EVELYN BUYA,
JAIME DINGCOG, DINAOAN CUT-
ING, PEDRO DONATO, MYRNA
GUAY, FLORA ANSIBEY, GRACE
DINAMLING, EDUARDO MENCIAS,
ROSENDA JACOB, SIONITA
DINGCOG, GLORIA JACOB,
MAXIMA GUAY, RODRIGO
PAGGADUT, MARINA ANSIBEY,
TOLENTINO INLAB, RUBEN
DULNUAN, GERONIMO LICYAYO,
LEONCIO CUMTI, MARY
DULNUAN, FELISA BALANBAN,
MYRNA DUYAN, MARY MALAN-
UYA, PRUDENCIO ANSIBEY,
GUILLERMO GUAY, MARGARITA
CULHI, ALADIN ANSIBEY, PABLO
DUYAN, PEDRO PUGUON, JULIAN
INLAB, JOSEPH NACULON,
ROGER BAJITA, DINAON GUAY,
JAIME ANANAYO, MARY
ANSIBEY, LINA ANANAYO,
MAURA DUYAPAT, ARTEMEO
ANANAYO, MARY BABLING,
NORA ANSIBEY, DAVID DULNUAN,
AVELINO PUGUON, LUCAS
GUMAWI, LUISA
ABBAC, CATHRIN GUWAY,
CLARITA TAYABAN, FLORA
JAVERA, RANDY SICOAN, FELIZA
PUTAKI, CORAZON P. DULNUAN,
NENA D. BULLONG, ERMELYN
GUWAY, GILBERT BUTALE,
JOSEPH B. BULLONG, FRANCISCO
PATNAAN, JR., SHERWIN DUGAY,
TIRSO GULLINGAY, BENEDICT T.
NABALLIN, RAMON PUN-ADWAN,
ALFONSO DULNUAN, CARMEN D.
BUTALE, LOLITA ANSIBEY,
ABRAHAM DULNUAN, ARLYNDA
BUTALE, MODESTO A. ANSIBEY,
EDUARDO LUGAY, ANTONIO
HUMIWAT, ALFREDO PUMIHIC,
MIKE TINO, TONY
CABARROGUIS, BASILIO
TAMLIWOK, JR., NESTOR
TANGID, ALEJO TUGUINAY,
BENITO LORENZO, RUDY
BAHIWAG, ANALIZA BUTALE,
NALLEM LUBYOC, JOSEPH
DUHAYON, RAFAEL CAMPOL,
MANUEL PUMALO, DELFIN
AGALOOS, PABLO CAYANGA,
PERFECTO SISON, ELIAS
NATAMA, LITO PUMALO,
SEVERINA DUGAY, GABRIEL
PAKAYAO, JEOFFREY SINDAP,
FELIX TICUAN, MARIANO S.
MADDELA, MENZI TICAWA,
DOMINGA DUGAY, JOE BOLINEY,
JASON ASANG, TOMMY
ATENYAYO, ALEJO AGMALIW,
DIZON AGMALIW, EDDIE ATOS,
FELIMON BLANCO, DARRIL
DIGOY, LUCAS BUAY, ARTEMIO
BRAZIL, NICANOR MODI, LUIS
REDULFIN, NESTOR JUSTINO,
JAIME CUMILA, BENEDICT
GUINID, EDITHA ANIN, INOH-
YABAN BANDAO, LUIS BAYWONG,
FELIPE DUHALNGON, PETER
BENNEL, JOSEPH T. BUNGGALAN,
JIMMY B. KIMAYONG, HENRY
PUGUON, PEDRO BUHONG,
BUGAN NADIAHAN, SR., MARIA
EDEN ORLINO, SPC, PERLA
VISSORO, and BISHOP RAMON
VILLENA,
Petitioners,

- versus -

ELISEA GOZUN, in her capacity as

SECRETARY of the DEPARTMENT
OF ENVIRONMENT and NATURAL
RESOURCES (DENR), HORACIO
RAMOS, in his capacity as Director of
the Mines and Geosciences Bureau
(MGB-DENR), ALBERTO ROMULO,
in his capacity as the Executive
Secretary of the Office of the President,
RICHARD N. FERRER, in his
capacity as Acting Undersecretary of
the Office of the President, IAN
HEATH SANDERCOCK, in his Promulgated:
capacity as President of CLIMAX-
ARIMCOMINING CORPORATION. March 30, 2006
Respondents.
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

CHICO-NAZARIO, J.:

This petition for prohibition and mandamus under Rule 65 of the Rules of Court assails the constitutionality of Republic Act
No. 7942 otherwise known as the Philippine Mining Act of 1995, together with the Implementing Rules and Regulations issued
pursuant thereto, Department of Environment and Natural Resources (DENR) Administrative Order No. 96-40, s. 1996 (DAO 96-
40) and of the Financial and Technical Assistance Agreement (FTAA) entered into on 20 June 1994 by the Republic of the
Philippines andArimco Mining Corporation (AMC), a corporation established under the laws of Australia and owned by its
nationals.
.
On 25 July 1987, then President Corazon C. Aquino promulgated Executive Order No. 279 which authorized the DENR
Secretary to accept, consider and evaluate proposals from foreign-owned corporations or foreign investors for contracts of
agreements involving either technical or financial assistance for large-scale exploration, development, and utilization of minerals,
which, upon appropriate recommendation of the Secretary, the President may execute with the foreign proponent.
 On 3 March 1995, then President Fidel V. Ramos signed into law Rep. Act No. 7942 entitled, An Act Instituting A New
System of Mineral Resources Exploration, Development, Utilization and Conservation, otherwise known as the Philippine Mining
Act of 1995.

On 15 August 1995, then DENR Secretary Victor O. Ramos issued DENR Administrative Order (DAO) No. 23, Series of
1995, containing the implementing guidelines of Rep. Act No. 7942. This was soon superseded by DAO No. 96-40, s. 1996, which
took effect on 23 January 1997 after due publication.

Previously, however, or specifically on 20 June 1994, President Ramos executed an FTAA with AMC over a total land area of
37,000 hectares covering the provinces ofNueva Vizcaya and Quirino. Included in this area
is Barangay Dipidio, Kasibu, Nueva Vizcaya.

Subsequently, AMC consolidated with Climax Mining Limited to form a single company that now goes under the new name
of Climax-Arimco Mining Corporation (CAMC), the controlling 99% of stockholders of which are Australian nationals.

On 7 September 2001, counsels for petitioners filed a demand letter addressed to then DENR Secretary Heherson Alvarez, for
the cancellation of the CAMC FTAA for the primary reason that Rep. Act No. 7942 and its Implementing Rules and Regulations
DAO 96-40 are unconstitutional. The Office of the Executive Secretary was also furnished a copy of the said letter. There being no
response to both letters, another letter of the same content dated 17 June 2002 was sent to President Gloria Macapagal Arroyo. This
letter was indorsed to the DENR Secretary and eventually referred to the Panel of Arbitrators of the Mines and Geosciences Bureau
(MGB), Regional Office No. 02, Tuguegarao,Cagayan, for further action.

On 12 November 2002, counsels for petitioners received a letter from the Panel of Arbitrators of the MGB requiring the
petitioners to comply with the Rules of the Panel of Arbitrators before the letter may be acted upon.

Yet again, counsels for petitioners sent President Arroyo another demand letter dated 8 November 2002. Said letter was again
forwarded to the DENR Secretary who referred the same to the MGB, Quezon City.
 In a letter dated 19 February 2003, the MGB rejected the demand of counsels for petitioners for the cancellation of
the CAMC FTAA.

Petitioners thus filed the present petition for prohibition and mandamus, with a prayer for a temporary restraining order. They
pray that the Court issue an order:

1. enjoining public respondents from acting on any application for FTAA;

2. declaring unconstitutional the Philippine Mining Act of 1995 and its Implementing Rules and Regulations;

3. canceling the FTAA issued to CAMC.

In their memorandum petitioners pose the following issues:

WHETHER OR NOT REPUBLIC ACT NO. 7942 AND THE CAMC FTAA ARE VOID BECAUSE THEY ALLOW THE
UNJUST AND UNLAWFUL TAKING OF PROPERTY WITHOUT PAYMENT OF JUST COMPENSATION , IN
VIOLATION OF SECTION 9, ARTICLE III OF THE CONSTITUTION.

II

WHETHER OR NOT THE MINING ACT AND ITS IMPLEMENTING RULES AND REGULATIONS ARE VOID AND
UNCONSTITUTIONAL FOR SANCTIONING AN UNCONSTITUTIONAL ADMINISTRATIVE PROCESS OF
DETERMINING JUST COMPENSATION.

III
 WHETHER OR NOT THE STATE, THROUGH REPUBLIC ACT NO. 7942 AND THE CAMC FTAA, ABDICATED
ITS PRIMARY RESPONSIBILITY TO THE FULL CONTROL AND SUPERVISION OVER NATURAL RESOURCES.

IV

WHETHER OR NOT THE RESPONDENTS INTERPRETATION OF THE ROLE OF WHOLLY FOREIGN AND
FOREIGN-OWNED CORPORATIONS IN THEIR INVOLVEMENT IN MINING ENTERPRISES, VIOLATES
PARAGRAPH 4, SECTION 2, ARTICLE XII OF THE CONSTITUTION.

WHETHER OR NOT THE 1987 CONSTITUTION PROHIBITS SERVICE CONTRACTS.[1]

Before going to the substantive issues, the procedural question raised by public respondents shall first be dealt with. Public
respondents are of the view that petitioners eminent domain claim is not ripe for adjudication as they fail to allege that CAMC has
actually taken their properties nor do they allege that their property rights have been endangered or are in danger on account
of CAMCs FTAA. In effect, public respondents insist that the issue of eminent domain is not a justiciable controversy which this
Court can take cognizance of.

A justiciable controversy is defined as a definite and concrete dispute touching on the legal relations of parties having adverse
legal interests which may be resolved by a court of law through the application of a law.[2] Thus, courts have no judicial power to
review cases involving political questions and as a rule, will desist from taking cognizance of speculative or hypothetical cases,
advisory opinions and cases that have become moot.[3] The Constitution is quite explicit on this matter.[4] It provides that judicial
power includes the duty of the courts of justice to settle actual controversies involving rights which are legally demandable and
enforceable. Pursuant to this constitutional mandate, courts, through the power of judicial review, are to entertain only real disputes
between conflicting parties through the application of law. For the courts to exercise the power of judicial review, the following
must be extant (1) there must be an actual case calling for the exercise of judicial power; (2) the question must be ripe for
adjudication; and (3) the person challenging must have the standing.[5]
 An actual case or controversy involves a conflict of legal rights, an assertion of opposite legal claims, susceptible of judi cial
resolution as distinguished from a hypothetical or abstract difference or dispute.[6] There must be a contrariety of legal rights that
can be interpreted and enforced on the basis of existing law and jurisprudence.

Closely related to the second requisite is that the question must be ripe for adjudication. A question is considered ripe for
adjudication when the act being challenged has had a direct adverse effect on the individual challenging it.[7]

The third requisite is legal standing or locus standi. It is defined as a personal or substantial interest in the case such that the
party has sustained or will sustain direct injury as a result of the governmental act that is being challenged, alleging more than a
generalized grievance.[8] The gist of the question of standing is whether a party alleges such personal stake in the outcome of the
controversy as to assure that concrete adverseness which sharpens the presentation of issues upon which the court depends for
illumination of difficult constitutional questions.[9] Unless a person is injuriously affected in any of his constitutional rights by the
operation of statute or ordinance, he has no standing.[10]

In the instant case, there exists a live controversy involving a clash of legal rights as Rep. Act No. 7942 has been enacted,
DAO 96-40 has been approved and an FTAAshave been entered into. The FTAA holders have already been operating in various
provinces of the country. Among them is CAMC which operates in the provinces of NuevaVizcaya and Quirino where numerous
individuals including the petitioners are imperiled of being ousted from their landholdings in view of the CAMC FTAA. In light of
this, the court cannot await the adverse consequences of the law in order to consider the controversy actual and ripe for judicial
intervention.[11] Actual eviction of the land owners and occupants need not happen for this Court to intervene. As held in Pimentel,
Jr. v. Hon. Aguirre[12]:

By the mere enactment of the questioned law or the approval of the challenged act, the dispute is said to have ripened into a
judicial controversy even without any other overt act. Indeed, even a singular violation of the Constitution and/or the law is
enough to awaken judicial duty.[13]

Petitioners embrace various segments of the society. These include Didipio Earth-Savers Multi-Purpose Association, Inc., an
organization of farmers and indigenous peoples organized under Philippine laws, representing a community actually affected by the
mining activities of CAMC, as well as other residents of areas affected by the mining activities of CAMC. These petitioners have
the standing to raise the constitutionality of the questioned FTAA as they allege a personal and substantial injury. [14] They assert that
they are affected by the mining activities of CAMC. Likewise, they are under imminent threat of being displaced from their
landholdings as a result of the implementation of the questioned FTAA. They thus meet the appropriate case requirement as they
assert an interest adverse to that of respondents who, on the other hand, claim the validity of the assailed statute and the FTAA of
CAMC.

Besides, the transcendental importance of the issues raised and the magnitude of the public interest involved will have a
bearing on the countrys economy which is to a greater extent dependent upon the mining industry. Also affected by the resolution
of this case are the proprietary rights of numerous residents in the mining contract areas as well as the social existence of indigenous
peoples which are threatened. Based on these considerations, this Court deems it proper to take cognizance of the instant petition.

Having resolved the procedural question, the constitutionality of the law under attack must be addressed squarely.

First Substantive Issue: Validity of Section 76 of Rep. Act No. 7942 and DAO 96-40

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.

Interpreting Section 76 of Rep. Act No. 7942 and Section 107 of DAO 96-40, juxtaposed with the concept of taking of
property for purposes of eminent domain in the case of Republic v. Vda. de Castellvi,[15] petitioners assert that there is indeed a
taking upon entry into private lands and concession areas.

Republic v. Vda. de Castellvi defines taking under the concept of eminent domain as entering upon private property for
more than a momentary period, and, under the warrant or color of legal authority, devoting it to a public use, or otherwise informally
appropriating or injuriously affecting it in such a way as to substantially oust the owner and deprive him of all beneficial enjoyment
thereof.
 From the criteria set forth in the cited case, petitioners claim that the entry into a private property by CAMC, pursuant to its
FTAA, is for more than a momentary period,i.e., for 25 years, and renewable for another 25 years; that the entry into the property is
under the warrant or color of legal authority pursuant to the FTAA executed between the government and CAMC; and that the entry
substantially ousts the owner or possessor and deprives him of all beneficial enjoyment of the property. These facts, according to the
petitioners, amount to taking. As such, petitioners question the exercise of the power of eminent domain as unwarranted because
respondents failed to prove that the entry into private property is devoted for public use.

Petitioners also stress that even without the doctrine in the Castellvi case, the nature of the mining activity, the extent of the
land area covered by the CAMC FTAA and the various rights granted to the proponent or the FTAA holder, such as (a) the right of
possession of the Exploration Contract Area, with full right of ingress and egress and the right to occupy the same; (b) the right not
to be prevented from entry into private lands by surface owners and/or occupants thereof when prospecting, exploring and exploiting
for minerals therein; (c) the right to enjoy easement rights, the use of timber, water and other natural resources in the Exploration
Contract Area; (d) the right of possession of the Mining Area, with full right of ingress and egress and the right to occupy the same;
and (e) the right to enjoy easement rights, water and other natural resources in the Mining Area, result in a taking of private property.

Petitioners quickly add that even assuming arguendo that there is no absolute, physical taking, at the very least, Section 76
establishes a legal easement upon the surface owners, occupants and concessionaires of a mining contract area sufficient to deprive
them of enjoyment and use of the property and that such burden imposed by the legal easement falls within the purview of eminent
domain.

To further bolster their claim that the legal easement established is equivalent to taking, petitioners cite the case of National
Power Corporation v. Gutierrez[16] holding that the easement of right-of-way imposed against the use of the land for an indefinite
period is a taking under the power of eminent domain.

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.
 Public respondents are inclined to believe that by entering private lands and concession areas, FTAA holders do not oust the
owners thereof nor deprive them of all beneficial enjoyment of their properties as the said entry merely establishes a legal easement
upon surface owners, occupants and concessionaires of a mining contract area.

Taking in Eminent Domain Distinguished from Regulation in Police Power

The power of eminent domain is the inherent right of the state (and of those entities to which the power has been lawfully
delegated) to condemn private property to public use upon payment of just compensation. [17] On the other hand, police power is the
power of the state to promote public welfare by restraining and regulating the use of liberty and property. [18] Although both police
power and the power of eminent domain have the general welfare for their object, and recent trends show a mingling [19] of the two
with the latter being used as an implement of the former, there are still traditional distinctions between the two.

Property condemned under police power is usually noxious or intended for a noxious purpose; hence, no compensation shall
be paid.[20] Likewise, in the exercise of police power, property rights of private individuals are subjected to restraints and burdens in
order to secure the general comfort, health, and prosperity of the state. Thus, an ordinance prohibiting theaters from selling tickets in
excess of their seating capacity (which would result in the diminution of profits of the theater-owners) was upheld valid as this
would promote the comfort, convenience and safety of the customers.[21] In U.S. v. Toribio,[22] the court upheld the provisions of Act
No. 1147, a statute regulating the slaughter of carabao for the purpose of conserving an adequate supply of draft animals, as a valid
exercise of police power, notwithstanding the property rights impairment that the ordinance imposed on cattle owners. A zoning
ordinance prohibiting the operation of a lumber yard within certain areas was assailed as unconstitutional in that it was an invasion
of the property rights of the lumber yard owners in People v. de Guzman.[23] The Court nonetheless ruled that the regulation was a
valid exercise of police power. A similar ruling was arrived at in Seng Kee S Co. v. Earnshaw and Piatt[24] where an ordinance
divided the City of Manila into industrial and residential areas.

A thorough scrutiny of the extant jurisprudence leads to a cogent deduction that where a property interest is merely restricted
because the continued use thereof would be injurious to public welfare, or where property is destroyed because its continued
existence would be injurious to public interest, there is no compensable taking.[25] However, when a property interest is appropriated
and applied to some public purpose, there is compensable taking.[26]
 According to noted constitutionalist, Fr. Joaquin Bernas, SJ, in the exercise of its police power regulation, the state restricts
the use of private property, but none of the property interests in the bundle of rights which constitute ownership is appropriated for
use by or for the benefit of the public.[27] Use of the property by the owner was limited, but no aspect of the property is used by or
for the public.[28] The deprivation of use can in fact be total and it will not constitute compensable taking if nobody else acquires use
of the property or any interest therein.[29]

If, however, in the regulation of the use of the property, somebody else acquires the use or interest thereof, such restriction
constitutes compensable taking. Thus, in City Government of Quezon City v. Ericta,[30] it was argued by the local government that
an ordinance requiring private cemeteries to reserve 6% of their total areas for the burial of paupers was a valid exercise of the police
power under the general welfare clause. This court did not agree in the contention, ruling that property taken under the police power
is sought to be destroyed and not, as in this case, to be devoted to a public use. It further declared that the ordinance in question was
actually a taking of private property without just compensation of a certain area from a private cemetery to benefit paupers who are
charges of the local government. Being an exercise of eminent domain without provision for the payment of just compensation, the
same was rendered invalid as it violated the principles governing eminent domain.

In People v. Fajardo,[31] the municipal mayor refused Fajardo permission to build a house on his own land on the ground that
the proposed structure would destroy the view or beauty of the public plaza. The ordinance relied upon by the mayor prohibited the
construction of any building that would destroy the view of the plaza from the highway. The court ruled that the municipal ordinance
under the guise of police power permanently divest owners of the beneficial use of their property for the benefit of the public; hence,
considered as a taking under the power of eminent domain that could not be countenanced without payment of just compensation to
the affected owners. In this case, what the municipality wanted was to impose an easement on the property in order to preserve the
view or beauty of the public plaza, which was a form of utilization of Fajardos property for public benefit.[32]

While the power of eminent domain often results in the appropriation of title to or possession of property, it need not always
be the case. Taking may include trespass without actual eviction of the owner, material impairment of the value of the property or
prevention of the ordinary uses for which the property was intended such as the establishment of an easement. [33] In Ayala
de Roxas v. City of Manila,[34] it was held that the imposition of burden over a private property through easement was considered
taking; hence, payment of just compensation is required. The Court declared:
 And, considering that the easement intended to be established, whatever may be the object thereof, is not merely a
real right that will encumber the property, but is one tending to prevent the exclusive use of one portion of the same, by
expropriating it for public use which, be it what it may, can not be accomplished unless the owner of the property
condemned or seized be previously and duly indemnified, it is proper to protect the appellant by means of the remedy
employed in such cases, as it is only adequate remedy when no other legal action can be resorted to, against an intent which
is nothing short of an arbitrary restriction imposed by the city by virtue of the coercive power with which the same is
invested.

And in the case of National Power Corporation v. Gutierrez,[35] despite the NPCs protestation that the owners were not
totally deprived of the use of the land and could still plant the same crops as long as they did not come into contact with the wires,
the Court nevertheless held that the easement of right-of-way was a taking under the power of eminent domain. The Court said:

In the case at bar, the easement of right-of-way is definitely a taking under the power of eminent domain. Considering
the nature and effect of the installation of 230 KV Mexico-Limay transmission lines, the limitation imposed by NPC against
the use of the land for an indefinite period deprives private respondents of its ordinary use.

A case exemplifying an instance of compensable taking which does not entail transfer of title is Republic v. Philippine Long
Distance Telephone Co.[36] Here, the Bureau of Telecommunications, a government instrumentality, had contracted with the PLDT
for the interconnection between the Government Telephone System and that of the PLDT, so that the former could make use of the
lines and facilities of the PLDT. In its desire to expand services to government offices, the Bureau of Telecommunications
demanded to expand its use of the PLDT lines. Disagreement ensued on the terms of the contract for the use of the PLDT
facilities. The Court ruminated:

Normally, of course, the power of eminent domain results in the taking or appropriation of title to, and possession of,
the expropriated property; but no cogent reason appears why said power may not be availed of to impose only a burden upon
the owner of the condemned property, without loss of title and possession. It is unquestionable that real property may,
through expropriation, be subjected to an easement right of way.[37]

In Republic v. Castellvi,[38] this Court had the occasion to spell out the requisites of taking in eminent domain, to wit:
 (1) the expropriator must enter a private property;

(2) the entry must be for more than a momentary period.

(3) the entry must be under warrant or color of legal authority;

(4) the property must be devoted to public use or otherwise informally appropriated or injuriously affected;

(5) the utilization of the property for public use must be in such a way as to oust the owner and deprive him of beneficial
enjoyment of the property.

As shown by the foregoing jurisprudence, a regulation which substantially deprives the owner of his proprietary rights and
restricts the beneficial use and enjoyment for public use amounts to compensable taking. In the case under consideration, the entry
referred to in Section 76 and the easement rights under Section 75 of Rep. Act No. 7942 as well as the various rights to CAMC
under its FTAA are no different from the deprivation of proprietary rights in the cases discussed which this Court considered as
taking. Section 75 of the law in question reads:

Easement Rights. - When mining areas are so situated that for purposes of more convenient mining operations it is
necessary to build, construct or install on the mining areas or lands owned, occupied or leased by other persons, such
infrastructure as roads, railroads, mills, waste dump sites, tailing ponds, warehouses, staging or storage areas and port
facilities, tramways, runways, airports, electric transmission, telephone or telegraph lines, dams and their normal flood
and catchment areas, sites for water wells, ditches, canals, new river beds, pipelines, flumes, cuts, shafts, tunnels, or mills,
the contractor, upon payment of just compensation, shall be entitled to enter and occupy said mining areas or lands.

Section 76 provides:

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.
 The CAMC FTAA grants in favor of CAMC the right of possession of the Exploration Contract Area, the full right of ingress
and egress and the right to occupy the same. It also bestows CAMC the right not to be prevented from entry into private lands by
surface owners or occupants thereof when prospecting, exploring and exploiting minerals therein.

The entry referred to in Section 76 is not just a simple right-of-way which is ordinarily allowed under the provisions of the
Civil Code. Here, the holders of mining rights enter private lands for purposes of conducting mining activities such as exploration,
extraction and processing of minerals. Mining right holders build mine infrastructure, dig mine shafts and connecting tunnels,
prepare tailing ponds, storage areas and vehicle depots, install their machinery, equipment and sewer systems. On top of this, under
Section 75, easement rights are accorded to them where they may build warehouses, port facilities, electric transmission, railroads
and other infrastructures necessary for mining operations. All these will definitely oust the owners or occupants of the affected areas
the beneficial ownership of their lands. Without a doubt, taking occurs once mining operations commence.

Section 76 of Rep. Act No. 7942 is a Taking Provision

Moreover, it would not be amiss to revisit the history of mining laws of this country which would help us understand Section
76 of Rep. Act No. 7942.

This provision is first found in Section 27 of Commonwealth Act No. 137 which took effect on 7 November 1936, viz:

Before entering private lands the prospector shall first apply in writing for written permission of the private owner,
claimant, or holder thereof, and in case of refusal by such private owner, claimant, or holder to grant such permission, or in
case of disagreement as to the amount of compensation to be paid for such privilege of prospecting therein, the amount of
such compensation shall be fixed by agreement among the prospector, the Director of the Bureau of Mines and the surface
owner, and in case of their failure to unanimously agree as to the amount of compensation, all questions at issue shall be
determined by the Court of First Instance.

Similarly, the pertinent provision of Presidential Decree No. 463, otherwise known as The Mineral Resources Development
Decree of 1974, provides:
 SECTION 12. Entry to Public and Private Lands. A person who desires to conduct prospecting or other mining
operations within public lands covered by concessions or rights other than mining shall first obtain the written permission of
the government official concerned before entering such lands. In the case of private lands, the written permission of the
owner or possessor of the land must be obtained before entering such lands. In either case, if said permission is denied, the
Director, at the request of the interested person may intercede with the owner or possessor of the land. If the intercession
fails, the interested person may bring suit in the Court of First Instance of the province where the land is situated. If the court
finds the request justified, it shall issue an order granting the permission after fixing the amount of compensation and/or
rental due the owner or possessor: Provided, That pending final adjudication of such amount, the court shall upon
recommendation of the Director permit the interested person to enter, prospect and/or undertake other mining operations on
the disputed land upon posting by such interested person of a bond with the court which the latter shall consider adequate to
answer for any damage to the owner or possessor of the land resulting from such entry, prospecting or any other mining
operations.

Hampered by the difficulties and delays in securing surface rights for the entry into private lands for purposes of mining
operations, Presidential Decree No. 512 dated 19 July 1974 was passed into law in order to achieve full and accelerated mineral
resources development. Thus, Presidential Decree No. 512 provides for a new system of surface rights acquisition by mining
prospectors and claimants. Whereas in Commonwealth Act No. 137 and Presidential Decree No. 463 eminent domain may only
be exercised in order that the mining claimants can build, construct or install roads, railroads, mills, warehouses and other facilities,
this time, the power of eminent domain may now be invoked by mining operators for the entry, acquisition and use of private
lands, viz:

SECTION 1. Mineral prospecting, location, exploration, development and exploitation is hereby declared of public
use and benefit, and for which the power of eminent domain may be invoked and exercised for the entry, acquisition and use
of private lands. x x x.

The evolution of mining laws gives positive indication that mining operators who are qualified to own lands were granted the
authority to exercise eminent domain for the entry, acquisition, and use of private lands in areas open for mining operations. This
grant of authority extant in Section 1 of Presidential Decree No. 512 is not expressly repealed by Section 76 of Rep. Act No. 7942;
and neither are the former statutes impliedly repealed by the former. These two provisions can stand together even if Section 76 of
Rep. Act No. 7942 does not spell out the grant of the privilege to exercise eminent domain which was present in the old law.
 It is an established rule in statutory construction that in order that one law may operate to repeal another law, the two laws
must be inconsistent.[39] The former must be so repugnant as to be irreconciliable with the latter act. Simply because a latter
enactment may relate to the same subject matter as that of an earlier statute is not of itself sufficient to cause an implied repeal of the
latter, since the new law may be cumulative or a continuation of the old one. As has been the ruled, repeals by implication are not
favored, and will not be decreed unless it is manifest that the legislature so intended. [40] As laws are presumed to be passed with
deliberation and with full knowledge of all existing ones on the subject, it is but reasonable to conclude that in passing a statute it
was not intended to interfere with or abrogate any former law relating to the same matter, unless the repugnancy between the two is
not only irreconcilable, but also clear and convincing, and flowing necessarily from the language used, unless the later act fully
embraces the subject matter of the earlier, or unless the reason for the earlier act is beyond peradventure removed. [41] Hence, every
effort must be used to make all acts stand and if, by any reasonable construction, they can be reconciled, the latter act will not
operate as a repeal of the earlier.

Considering that Section 1 of Presidential Decree No. 512 granted the qualified mining operators the authority to exercise
eminent domain and since this grant of authority is deemed incorporated in Section 76 of Rep. Act No. 7942, the inescapable
conclusion is that the latter provision is a taking provision.

While this Court declares that the assailed provision is a taking provision, this does not mean that it is unconstitutional on the
ground that it allows taking of private property without the determination of public use and the payment of just compensation.

The taking to be valid must be for public use.[42] Public use as a requirement for the valid exercise of the power of eminent
domain is now synonymous with public interest, public benefit, public welfare and public convenience.[43] It includes the broader
notion of indirect public benefit or advantage. Public use as traditionally understood as actual use by the public has already been
abandoned.[44]

Mining industry plays a pivotal role in the economic development of the country and is a vital tool in the governments thrust
of accelerated recovery.[45] The importance of the mining industry for national development is expressed in Presidential Decree No.
463:
 WHEREAS, mineral production is a major support of the national economy, and therefore the intensified discovery,
exploration, development and wise utilization of the countrys mineral resources are urgently needed for national
development.

Irrefragably, mining is an industry which is of public benefit.

That public use is negated by the fact that the state would be taking private properties for the benefit of private mining firms or
mining contractors is not at all true. In Heirs of Juancho Ardona v. Reyes,[46] petitioners therein contended that the promotion of
tourism is not for public use because private concessionaires would be allowed to maintain various facilities such as restaurants,
hotels, stores, etc., inside the tourist area. The Court thus contemplated:

The rule in Berman v. Parker [348 U.S. 25; 99 L. ed. 27] of deference to legislative policy even if such policy might
mean taking from one private person and conferring on another private person applies as well in the Philippines.

. . . Once the object is within the authority of Congress, the means by which it will be attained is also
for Congress to determine. Here one of the means chosen is the use of private enterprise for redevelopment of
the area. Appellants argue that this makes the project a taking from one businessman for the benefit of another
businessman. But the means of executing the project are for Congress and Congress alone to determine, once
the public purpose has been established. x x x[47]

Petitioners further maintain that the states discretion to decide when to take private property is reduced contractually by
Section 13.5 of the CAMC FTAA, which reads:

If the CONTRACTOR so requests at its option, the GOVERNMENT shall use its offices and legal powers to assist
in the acquisition at reasonable cost of any surface areas or rights required by the CONTRACTOR at
the CONTRACTORs cost to carry out the Mineral Exploration and the Mining Operations herein.

All obligations, payments and expenses arising from, or incident to, such agreements or acquisition of right shall be
for the account of the CONTRACTOR and shall be recoverable as Operating Expense.
 According to petitioners, the government is reduced to a sub-contractor upon the request of the private respondent, and on
account of the foregoing provision, the contractor can compel the government to exercise its power of eminent domain thereby
derogating the latters power to expropriate property.

The provision of the FTAA in question lays down the ways and means by which the foreign-owned contractor, disqualified to
own land, identifies to the government the specific surface areas within the FTAA contract area to be acquired for the mine
infrastructure.[48] The government then acquires ownership of the surface land areas on behalf of the contractor, through a voluntary
transaction in order to enable the latter to proceed to fully implement the FTAA. Eminent domain is not yet called for at this stage
since there are still various avenues by which surface rights can be acquired other than expropriation. The FTAA provision under
attack merely facilitates the implementation of the FTAA given to CAMC and shields it from violating the Anti-Dummy Law.
Hence, when confronted with the same question in La Bugal-BLaan Tribal Association, Inc. v. Ramos,[49]the Court answered:

Clearly, petitioners have needlessly jumped to unwarranted conclusions, without being aware of the rationale for the
said provision. That provision does not call for the exercise of the power of eminent domain -- and determination of just
compensation is not an issue -- as much as it calls for a qualified party to acquire the surface rights on behalf of a foreign-
owned contractor.
Rather than having the foreign contractor act through a dummy corporation, having the State do the purchasing is a
better alternative. This will at least cause the government to be aware of such transaction/s and foster transparency in the
contractors dealings with the local property owners. The government, then, will not act as a subcontractor of the
contractor; rather, it will facilitate the transaction and enable the parties to avoid a technical violation of the Anti-Dummy
Law.

There is also no basis for the claim that the Mining Law and its implementing rules and regulations do not provide for just
compensation in expropriating private properties. Section 76 of Rep. Act No. 7942 and Section 107 of DAO 96-40 provide for the
payment of just compensation:

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.

Such compensation shall be based on the agreement entered into between the holder of mining rights and the surface
owner, occupant or concessionaire thereof, where appropriate, in accordance with P.D. No. 512. (Emphasis supplied.)

Second Substantive Issue: Power of Courts to Determine Just Compensation

Closely-knit to the issue of taking is the determination of just compensation. It is contended that Rep. Act No. 7942 and
Section 107 of DAO 96-40 encroach on the power of the trial courts to determine just compensation in eminent domain cases
inasmuch as the same determination of proper compensation are cognizable only by the Panel of Arbitrators.

The question on the judicial determination of just compensation has been settled in the case of Export Processing Zone
Authority v. Dulay[50] wherein the court declared that the determination of just compensation in eminent domain cases is a judicial
function. Even as the executive department or the legislature may make the initial determinations, the same cannot prevail over the
courts findings.

Implementing Section 76 of Rep. Act No. 7942, Section 105 of DAO 96-40 states that holder(s) of mining right(s) shall not be
prevented from entry into its/their contract/mining areas for the purpose of exploration, development, and/or utilization. That in
cases where surface owners of the lands, occupants or concessionaires refuse to allow the permit holder or contractor entry, the latter
shall bring the matter before the Panel of Arbitrators for proper disposition. Section 106 states that voluntary agreements between
the two parties permitting the mining right holders to enter and use the surface owners lands shall be registered with the Regional
Office of the MGB. In connection with Section 106, Section 107 provides that the compensation for the damage done to the surface
owner, occupant or concessionaire as a consequence of mining operations or as a result of the construction or installation of the
infrastructure shall be properly and justly compensated and that such compensation shall be based on the agreement between the
holder of mining rights and surface owner, occupant or concessionaire, or where appropriate, in accordance with Presidential Decree
No. 512. In cases where there is disagreement to the compensation or where there is no agreement, the matter shall be brought
before the Panel of Arbitrators. Section 206 of the implementing rules and regulations provides an aggrieved party the remedy to
appeal the decision of the Panel of Arbitrators to the Mines Adjudication Board, and the latters decision may be reviewed by the
Supreme Court by filing a petition for review on certiorari.[51]

An examination of the foregoing provisions gives no indication that the courts are excluded from taking cognizance of
expropriation cases under the mining law. The disagreement referred to in Section 107 does not involve the exercise of eminent
domain, rather it contemplates of a situation wherein the permit holders are allowed by the surface owners entry into the latters
lands and disagreement ensues as regarding the proper compensation for the allowed entry and use of the private lands. Noticeably,
the provision points to a voluntary sale or transaction, but not to an involuntary sale.

The legislature, in enacting the mining act, is presumed to have deliberated with full knowledge of all existing laws and
jurisprudence on the subject. Thus, it is but reasonable to conclude that in passing such statute it was in accord with the existing
laws and jurisprudence on the jurisdiction of courts in the determination of just compensation and that it was not intended to
interfere with or abrogate any former law relating to the same matter. Indeed, there is nothing in the provisions of the assailed law
and itsimplementing rules and regulations that exclude the courts from their jurisdiction to determine just compensation in
expropriation proceedings involving mining operations. Although Section 105 confers upon the Panel of Arbitrators the authority to
decide cases where surface owners, occupants, concessionaires refuse permit holders entry, thus, necessitating involuntary taking,
this does not mean that the determination of the just compensation by the Panel of Arbitrators or the Mines Adjudication Board is
final and conclusive. The determination is only preliminary unless accepted by all parties concerned. There is nothing wrong with
the grant of primary jurisdiction by the Panel of Arbitrators or the Mines Adjudication Board to determine in a preliminary matter
the reasonable compensation due the affected landowners or occupants.[52] The original and exclusive jurisdiction of the courts to
decide determination of just compensation remains intact despite the preliminary determination made by the administrative
agency. As held inPhilippine Veterans Bank v. Court of Appeals[53]:

The jurisdiction of the Regional Trial Courts is not any less original and exclusive because the question is first
passed upon by the DAR, as the judicial proceedings are not a continuation of the administrative determination.

Third Substantive Issue: Sufficient Control by the State Over Mining Operations
 Anent the third issue, petitioners charge that Rep. Act No. 7942, as well as its Implementing Rules and Regulations, makes it
possible for FTAA contracts to cede over to a fully foreign-owned corporation full control and management of mining enterprises,
with the result that the State is allegedly reduced to a passive regulator dependent on submitted plans and reports, with weak review
and audit powers. The State is not acting as the supposed owner of the natural resources for and on behalf of the Filipino people; it
practically has little effective say in the decisions made by the enterprise. In effect, petitioners asserted that the law, the
implementing regulations, and the CAMC FTAA cede beneficial ownership of the mineral resources to the foreign contractor.

It must be noted that this argument was already raised in La Bugal-BLaan Tribal Association, Inc. v. Ramos,[54] where the
Court answered in the following manner:

RA 7942 provides for the states control and supervision over mining operations. The following provisions thereof
establish the mechanism of inspection and visitorial rights over mining operations and institute reportorial requirements in
this manner:

1. Sec. 8 which provides for the DENRs power of over-all supervision and periodic review for the
conservation, management, development and proper use of the States mineral resources;
2. Sec. 9 which authorizes the Mines and Geosciences Bureau (MGB) under the DENR to exercise direct
charge in the administration and disposition of mineral resources, and empowers the MGB to monitor the
compliance by the contractor of the terms and conditions of the mineral agreements, confiscate surety and
performance bonds, and deputize whenever necessary any member or unit of the Phil. National
Police, barangay, duly registered non-governmental organization (NGO) or any qualified person to police
mining activities;
3. Sec. 66 which vests in the Regional Director exclusive jurisdiction over safety inspections of all
installations, whether surface or underground, utilized in mining operations.
4. Sec. 35, which incorporates into all FTAAs the following terms, conditions and warranties:
(g) Mining operations shall be conducted in accordance with the provisions of the Act and its IRR.
(h) Work programs and minimum expenditures commitments.
xxxx
 (k) Requiring proponent to effectively use appropriate anti-pollution technology and facilities to
protect the environment and restore or rehabilitate mined-out areas.
(l) The contractors shall furnish the Government records of geologic, accounting and other relevant
data for its mining operation, and that books of accounts and records shall be open for inspection
by the government. x x x.
(m) Requiring the proponent to dispose of the minerals at the highest price and more advantageous
terms and conditions.
xxxx
(o) Such other terms and conditions consistent with the Constitution and with this Act as the
Secretary may deem to be for the best interest of the State and the welfare of the Filipino people.
The foregoing provisions of Section 35 of RA 7942 are also reflected and implemented in Section 56 (g), (h), (l), (m)
and (n) of the Implementing Rules, DAO 96-40.
Moreover, RA 7942 and DAO 96-40 also provide various stipulations confirming the governments control over
mining enterprises:
The contractor is to relinquish to the government those portions of the contract area not needed for mining operations
and not covered by any declaration of mining feasibility (Section 35-e, RA 7942; Section 60, DAO 96-40).
The contractor must comply with the provisions pertaining to mine safety, health and environmental protection (Chapter
XI, RA 7942; Chapters XV and XVI, DAO 96-40).
For violation of any of its terms and conditions, government may cancel an FTAA. (Chapter XVII, RA 7942; Chapter
XXIV, DAO 96-40).
An FTAA contractor is obliged to open its books of accounts and records for 0inspection by the government (Section
56-m, DAO 96-40).
An FTAA contractor has to dispose of the minerals and by-products at the highest market price and register with the
MGB a copy of the sales agreement (Section 56-n, DAO 96-40).
MGB is mandated to monitor the contractors compliance with the terms and conditions of the FTAA; and to deputize,
when necessary, any member or unit of the Philippine National Police, thebarangay or a DENR-accredited
nongovernmental organization to police mining activities (Section 7-d and -f, DAO 96-40).
 An FTAA cannot be transferred or assigned without prior approval by the President (Section 40, RA 7942; Section 66,
DAO 96-40).
A mining project under an FTAA cannot proceed to the construction/development/utilization stage, unless its
Declaration of Mining Project Feasibility has been approved by government (Section 24, RA 7942).
The Declaration of Mining Project Feasibility filed by the contractor cannot be approved without submission of the
following documents:
1. Approved mining project feasibility study (Section 53-d, DAO 96-40)
2. Approved three-year work program (Section 53-a-4, DAO 96-40)
3. Environmental compliance certificate (Section 70, RA 7942)
4. Approved environmental protection and enhancement program (Section 69, RA 7942)
5. Approval by the Sangguniang Panlalawigan/Bayan/Barangay (Section 70, RA 7942; Section 27, RA 7160)
6. Free and prior informed consent by the indigenous peoples concerned, including payment of royalties
through a Memorandum of Agreement (Section 16, RA 7942; Section 59, RA 8371)
The FTAA contractor is obliged to assist in the development of its mining community, promotion of the general welfare
of its inhabitants, and development of science and mining technology (Section 57, RA 7942).
The FTAA contractor is obliged to submit reports (on quarterly, semi-annual or annual basis as the case may be; per
Section 270, DAO 96-40), pertaining to the following:
1. Exploration
2. Drilling
3. Mineral resources and reserves
4. Energy consumption
5. Production
6. Sales and marketing
7. Employment
8. Payment of taxes, royalties, fees and other Government Shares
9. Mine safety, health and environment
10. Land use
11. Social development
12. Explosives consumption
An FTAA pertaining to areas within government reservations cannot be granted without a written clearance from the
government agencies concerned (Section 19, RA 7942; Section 54, DAO 96-40).
 An FTAA contractor is required to post a financial guarantee bond in favor of the government in an amount equivalent
to its expenditures obligations for any particular year. This requirement is apart from the representations and
warranties of the contractor that it has access to all the financing, managerial and technical expertise and technology
necessary to carry out the objectives of the FTAA (Section 35-b, -e, and -f, RA 7942).
Other reports to be submitted by the contractor, as required under DAO 96-40, are as follows: an environmental report
on the rehabilitation of the mined-out area and/or mine waste/tailing covered area, and anti-pollution measures
undertaken (Section 35-a-2); annual reports of the mining operations and records of geologic accounting (Section 56-
m); annual progress reports and final report of exploration activities (Section 56-2).
Other programs required to be submitted by the contractor, pursuant to DAO 96-40, are the following: a safety and
health program (Section 144); an environmental work program (Section 168); an annual environmental protection and
enhancement program (Section 171).
The foregoing gamut of requirements, regulations, restrictions and limitations imposed upon the FTAA contractor by
the statute and regulations easily overturns petitioners contention. The setup under RA 7942 and DAO 96-40 hardly
relegates the State to the role of a passive regulator dependent on submitted plans and reports. On the contrary, the
government agencies concerned are empowered to approve or disapprove -- hence, to influence, direct and change -- the
various work programs and the corresponding minimum expenditure commitments for each of the exploration, development
and utilization phases of the mining enterprise.
Once these plans and reports are approved, the contractor is bound to comply with its commitments therein. Figures
for mineral production and sales are regularly monitored and subjected to government review, in order to ensure that the
products and by-products are disposed of at the best prices possible; even copies of sales agreements have to be submitted to
and registered with MGB. And the contractor is mandated to open its books of accounts and records for scrutiny, so as to
enable the State to determine if the government share has been fully paid.
The State may likewise compel the contractors compliance with mandatory requirements on mine safety, health and
environmental protection, and the use of anti-pollution technology and facilities. Moreover, the contractor is also obligated
to assist in the development of the mining community and to pay royalties to the indigenous peoples concerned.
Cancellation of the FTAA may be the penalty for violation of any of its terms and conditions and/or noncompliance
with statutes or regulations. This general, all-around, multipurpose sanction is no trifling matter, especially to a contractor
who may have yet to recover the tens or hundreds of millions of dollars sunk into a mining project.
Overall, considering the provisions of the statute and the regulations just discussed, we believe that the State
definitely possesses the means by which it can have the ultimate word in the operation of the enterprise, set directions and
 objectives, and detect deviations and noncompliance by the contractor; likewise, it has the capability to enforce compliance
and to impose sanctions, should the occasiontherefor arise.
In other words, the FTAA contractor is not free to do whatever it pleases and get away with it; on the contrary, it will
have to follow the government line if it wants to stay in the enterprise. Ineluctably then, RA 7942 and DAO 96-40 vest in
the government more than a sufficient degree of control and supervision over the conduct of mining operations.

Fourth Substantive Issue: The Proper Interpretation of the Constitutional Phrase Agreements Involving Either Technical
or Financial Assistance

In interpreting the first and fourth paragraphs of Section 2, Article XII of the Constitution, petitioners set forth the argument
that foreign corporations are barred from making decisions on the conduct of operations and the management of the mining
project. The first paragraph of Section 2, Article XII reads:

x x x 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 sixty percentum of 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 x x x.

The fourth paragraph of Section 2, Article XII provides:

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 x x x.

Petitioners maintain that the first paragraph bars aliens and foreign-owned corporations from entering into any direct
arrangement with the government including those which involve co-production, joint venture or production sharing
agreements. They likewise insist that the fourth paragraph allows foreign-owned corporations to participate in the large-scale
exploration, development and utilization of natural resources, but such participation, however, is merely limited to an agreement for
either financial or technical assistance only.

Again, this issue has already been succinctly passed upon by this Court in La Bugal-BLaan Tribal Association, Inc. v.
Ramos.[55] In discrediting such argument, the Court ratiocinated:

Petitioners claim that the phrase agreements x x x involving either technical or financial assistance simply
means technical assistance or financial assistance agreements, nothing more and nothing else. They insist that there is no
ambiguity in the phrase, and that a plain reading of paragraph 4 quoted above leads to the inescapable conclusion that what a
foreign-owned corporation may enter into with the government is merely an agreement for either financial or technical
assistance only, for the large-scale exploration, development and utilization of minerals, petroleum and other mineral oils;
such a limitation, they argue, excludes foreign management and operation of a mining enterprise.
This restrictive interpretation, petitioners believe, is in line with the general policy enunciated by the Constitution
reserving to Filipino citizens and corporations the use and enjoyment of the countrys natural resources. They maintain that
this Courts Decision of January 27, 2004 correctly declared the WMCP FTAA, along with pertinent provisions of RA 7942,
void for allowing a foreign contractor to have direct and exclusive management of a mining enterprise. Allowing such a
privilege not only runs counter to the full control and supervision that the State is constitutionally mandated to exercise
over the exploration, development and utilization of the countrys natural resources; doing so also vests in the foreign
company beneficial ownership of our mineral resources. It will be recalled that the Decision of January 27, 2004 zeroed
in on management or other forms of assistance or other activities associated with the service contracts of the martial law
regime, since the management or operation of mining activities by foreign contractors, which is the primary feature of
service contracts, was precisely the evil that the drafters of the 1987 Constitution sought to eradicate.
xxxx
We do not see how applying a strictly literal or verba legis interpretation of paragraph 4 could inexorably lead to the
conclusions arrived at in the ponencia. First, the drafters choice of words -- their use of the phrase agreements
x x x involving either technical or financial assistance -- does not indicate the intent to exclude other modes of assistance.
The drafters opted to use involving when they could have simply said agreements for financial or technical
assistance, if that was their intention to begin with. In this case, the limitation would be very clear and no further debate
would ensue.
In contrast, the use of the word involving signifies the possibility of the inclusion of other forms of assistance or
activities having to do with, otherwise related to or compatible with financial or technical assistance. The word involving
 as used in this context has three connotations that can be differentiated thus: one, the sense of concerning, having to do
with, or affecting; two, entailing, requiring, implying or necessitating; and three, including, containing or
comprising.
Plainly, none of the three connotations convey a sense of exclusivity. Moreover, the word involving, when
understood in the sense of including, as in including technical or financial assistance,necessarily implies that there
are activities other than those that are being included. In other words, if an agreement includes technical or financial
assistance, there is apart from such assistance -- something else already in, and covered or may be covered by, the said
agreement.
In short, it allows for the possibility that matters, other than those explicitly mentioned, could be made part of the
agreement. Thus, we are now led to the conclusion that the use of the word involving implies that these agreements with
foreign corporations are not limited to mere financial or technical assistance. The difference in sense becomes very apparent
when we juxtapose agreements fortechnical or financial assistance against agreements including technical or financial
assistance. This much is unalterably clear in a verba legis approach.
Second, if the real intention of the drafters was to confine foreign corporations to financial or technical assistance and
nothing more, their language would have certainly been so unmistakably restrictive and stringent as to leave no doubt in
anyones mind about their true intent. For example, they would have used the sentence foreign corporations are absolutely
prohibited from involvement in the management or operation of mining or similar ventures or words of similar import. A
search for such stringent wording yields negative results. Thus, we come to the inevitable conclusion that there was a
conscious and deliberate decision to avoid the use of restrictive wording that bespeaks an intent not to use the expression
agreements x x x involving either technical or financial assistance in an exclusionary and limiting manner.

Fifth Substantive Issue: Service Contracts Not Deconstitutionalized

Lastly, petitioners stress that the service contract regime under the 1973 Constitution is expressly prohibited under the 1987
Constitution as the term service contracts found in the former was deleted in the latter to avoid the circumvention of constitutional
prohibitions that were prevalent in the 1987 Constitution. According to them, the framers of the 1987 Constitution only intended for
foreign-owned corporations to provide either technical assistance or financial assistance. Upon perusal of the CAMC FTAA,
petitioners are of the opinion that the same is a replica of the service contract agreements that the present constitution allegedly
prohibit.
 Again, this contention is not well-taken. The mere fact that the term service contracts found in the 1973 Constitution was not
carried over to the present constitution, sans any categorical statement banning service contracts in mining activities, does not mean
that service contracts as understood in the 1973 Constitution was eradicated in the 1987 Constitution.[56] The 1987 Constitution
allows the continued use of service contracts with foreign corporations as contractors who would invest in and operate and manage
extractive enterprises, subject to the full control and supervision of the State; this time, however, safety measures were put in place
to prevent abuses of the past regime.[57] We ruled, thus:

To our mind, however, such intent cannot be definitively and conclusively established from the mere failure to carry
the same expression or term over to the new Constitution, absent a more specific, explicit and unequivocal statement to that
effect. What petitioners seek (a complete ban on foreign participation in the management of mining operations, as
previously allowed by the earlier Constitutions) isnothing short of bringing about a momentous sea change in the economic
and developmental policies; and the fundamentally capitalist, free-enterprise philosophy of our government. We cannot
imagine such a radical shift being undertaken by our government, to the great prejudice of the mining sector in particular
and our economy in general, merely on the basis of the omission of the terms service contractfrom or the failure to carry
them over to the new Constitution. There has to be a much more definite and even unarguable basis for such a drastic
reversal of policies.
xxxx
The foregoing are mere fragments of the framers lengthy discussions of the provision dealing with agreements
x x x involving either technical or financial assistance, which ultimately became paragraph 4 of Section 2 of Article XII of
the Constitution. Beyond any doubt, the members of the ConCom were actually debating about the martial-law-era service
contracts for which they were crafting appropriate safeguards.
In the voting that led to the approval of Article XII by the ConCom, the explanations given by
Commissioners Gascon, Garcia and Tadeo indicated that they had voted to reject this provision on account of their
objections to the constitutionalization of the service contract concept.
Mr. Gascon said, I felt that if we would constitutionalize any provision on service contracts, this should always be
with the concurrence of Congress and not guided only by a general law to be promulgated by Congress. Mr. Garcia
explained, Service contracts are given constitutional legitimization in Sec. 3, even when they have been proven to be
inimical to the interests of the nation, providing, as they do, the legal loophole for the exploitation of our natural resources
for the benefit of foreign interests. Likewise, Mr. Tadeo cited inter alia the fact that service contracts continued to subsist,
enabling foreign interests to benefit from our natural resources. It was hardly likely that these gentlemen would have
objected so strenuously, had the provision called for mere technical or financial assistance and nothing more.
 The deliberations of the ConCom and some commissioners explanation of their votes leave no room for doubt that
the service contract concept precisely underpinned the commissioners understanding of the agreements involving either
technical or financial assistance.
xxxx
From the foregoing, we are impelled to conclude that the phrase agreements involving either technical or financial
assistance, referred to in paragraph 4, are in fact service contracts. But unlike those of the 1973 variety, the new ones are
between foreign corporations acting as contractors on the one hand; and on the other, the government as principal or
owner of the works. In the new service contracts, the foreign contractors provide capital, technology and technical know-
how, and managerial expertise in the creation and operation of large-scale mining/extractive enterprises; and the
government, through its agencies (DENR, MGB), actively exercises control and supervision over the entire operation.
xxxx
It is therefore reasonable and unavoidable to make the following conclusion, based on the above arguments. As
written by the framers and ratified and adopted by the people, the Constitution allows the continued use of service contracts
with foreign corporations -- as contractors who would invest in and operate and manage extractive enterprises, subject to the
full control and supervision of the State -- sans the abuses of the past regime. The purpose is clear: to develop and utilize
our mineral, petroleum and other resources on a large scale for the immediate and tangible benefit of the Filipino people.[58]

WHEREFORE, the instant petition for prohibition and mandamus is hereby DISMISSED. Section 76 of Republic Act No.
7942 and Section 107 of DAO 96-40; Republic Act No. 7942 and its Implementing Rules and Regulations contained in DAO 96-40
insofar as they relate to financial and technical assistance agreements referred to in paragraph 4 of Section 2 of Article XII of the
Constitution are NOT UNCONSTITUTIONAL.

LEPANTO CONSOLIDATED MINING COMPANY, petitioner, vs. WMC RESOURCES INTERNATIONAL PTY. LTD.,
and WMC (PHILIPPINES), INC.,respondents.

[G. R. No. 156214. September 24, 2003]

LEPANTO CONSOLIDATED MINING COMPANY, petitioner, vs. WMC RESOURCES INTERNATIONAL PTY. LTD.,
WMC (PHILIPPINES), INC., SOUTHCOT MINING CORPORATION, TAMPAKAN MINING CORPORATION and
SAGITTARIUS MINES, INC., respondents.

DECISION
CARPIO-MORALES, J.:

Elevated to this Court are twin petitions for review on certiorari under Rule 45 of the Rules of Court which involve
substantially the same parties and the same subject matter, hence, have been consolidated.
The first case, G. R. No. 153885, is an appeal from the Court of Appeals Decision of February 22, 2002 in CA-G.R. Sp
No. 65496, WMC Resources Intl. Pty. Ltd., and WMC (Philippines), Inc. v. Hon. Francisco B. Ibay, in his capacity as
Presiding Judge, Regional Trial Court of Makati City, Branch 135 and Lepanto Consolidated Mining Company,
and Resolution of June 6, 2002 denying reconsideration of said decision.
The second case, G. R. No. 156214, is an appeal from the Regional Trial Court (RTC) of Makati City, Branch 135
Orders dated September 9, 2002 and November 22, 2002 dismissing Civil Case No. 01-087, Lepanto Consolidated Mining
Company v. WMC Resources Intl. Pty. Ltd., and WMC (Philippines), Inc., Southcot Mining Corporation, Tampakan Mining
Corporation and Sagittarius Mines, Inc.
The antecedents of the cases are as follows:
In a contract denominated as Tampakan Option Agreement dated April 25, 1991, WMC Resources International Pty.
[1]

Ltd. (WMC), a wholly owned subsidiary of Western Mining Corporation Holdings Limited, a publicly listed major Australian
mining and exploration company, through its local subsidiary Western Mining Corporation (Philippines), Inc. (WMCP), a
corporation organized under Philippine laws, acquired the mining claims in Tampakan, South Cotabato of Southcot Mining
Corporation, Tampakan Mining Corporation, and Sagittarius Mines, Inc. (Tampakan Companies).
The Tampakan Option Agreement was amended by subsequent agreements including Amendatory Agreement dated
July 15, 1994 under which the Tampakan Companies were given preferential option to acquire the shares of WMC in
[2]

WMCP and Hillcrest Inc. in the event it (WMC) decided to sell them.
On March 22, 1995, then President Ramos on behalf of the Republic of the Philippines, entered into a Financial and
Technical Assistance Agreement (FTAA) with WMCP for the large scale exploration, development and commercial
[3]

exploitation of mineral resources in 99,387 hectares of lands in South Cotabato, Sultan Kudarat, Davao Del Sur and North
Kotabato.
 On July 12, 2000, WMC, by a Sale and Purchase Agreement, sold to herein petitioner Lepanto Consolidated Mining
[4]

Company its shares of stock in WMCP and Hillcrest, Inc. for $10,000,000.00. The sale was subject to certain conditions
including the Tampakan Companies failure to accept WMCPs offer to sell the same shares, under the companies right of
first refusal provided for in the Tampakan Option Agreement and its amendments.
By letter of July 13, 2000, WMCP tendered to the Tampakan Companies its offer for the latter to purchase WMCs
[5]

shares of stock in it (WMCP) and Hillcrest, Inc.

In the meantime or by letter of August 28, 2000, petitioner requested the approval by the Department of Environment
[6]

and Natural Resources (DENR) Secretary of the transfer to and acquisition by it of WMCPs FTAA on account of its
(petitioners) purchase of WMCs shares of stock in WMCP, which approval of transfer was required in the FTAA agreement
forged between then President Ramos and WMCP.
As the Tampakan Companies later availed of their preferential right under the Tampakan Option Agreement, a Sale [7]

and Purchase Agreement was concluded on October 6, 2000 between WMC and the Tampakan Companies over the same
[8]

shares of stock priorly purchased by petitioner.

On October 12, 2000, the Tampakan Companies notified the Director of the Mines and Geosciences Bureau (MGB) of
the DENR of the exercise of their preemptive right to buy WMCs equity in WMCP and Hillcrest, Inc., seeking at the same
time the MGB Directors formal expression of support for the stock transfer transaction.[9]

Petitioner, getting wind of the Sale and Purchase Agreement between WMC and Tampakan Companies, wrote, by letter
of October 13, 2000, the DENR Secretary about the invalidity of said agreement and reiterated its request for the approval
[10]

of its acquisition of the disputed shares. The MGB accordingly informed the Tampakan Companies of petitioners position on
the matter and required the submission of a comment thereto. [11]

WMCP and WMC, respondents herein, by letters to the MGB, proffered their side. Several other letters or position
papers were filed by the parties with the MGB or the DENR.
The Tampakan Companies later opted to acquire the disputed shares of stock through Sagittarius Mines, Inc. WMC and
Tampakan Companies thus entered into a Sale and Purchase Agreement dated January 10, 2001 which paved the way for
[12]

the forging of two deeds of absolute sale of the shares of stock, those of WMC in WMCP and in Hillcrest, Inc., both in favor of
Sagittarius Mines, Inc. [13]

On January 22, 2001, petitioner filed before the Makati RTC a complaint against herein respondents WMC, WMCP, and
the three corporations comprising the Tampakan Companies, for specific performance, annulment of contracts, contractual
interference and injunction (Civil Case No. 01-087). The suit principally sought the enforcement of the July 12, 2000 Sale
and Purchase Agreement between petitioner and WMC and the consequent nullification of the latters agreements with the
Tampakan Companies.
 Therein defendants-herein respondents filed before the Makati RTC a Joint Motion to Dismiss petitioners complaint on
[14]

the ground that the court was without jurisdiction over the subject matter of the case; that petitioners complaint had no cause
of action; that petitioner was guilty of forum shopping due to the pendency of its claim with the MGB; and that petitioner also
failed to exhaust administrative remedies.
Branch 135 of the Makati RTC denied herein respondents Motion to Dismiss as it did respondents Motion for
Reconsideration. Hence, respondents lodged on July 6, 2001 a special civil action for certiorari and prohibition (CA-G.R.
[15] [16]

SP No. 65496) with the Court of Appeals which was granted by February 22, 2002 Decision, the dispositive part of which
[17]

reads:
WHEREFORE, the petition for certiorari is hereby GRANTED. The assailed Order dated March 21, 2001 and May 2, 2001 are hereby
declared null and void and SET ASIDE. Respondent court is directed to desist from proceeding with Civil Case No. 01-087 and to
dismiss the same on ground of forum shopping committed by private respondent. (Underscoring supplied)
Petitioners motion for reconsideration of the appellate courts judgment was denied by Resolution of June 6,
2002, hence, it filed on June 28, 2002 a petition for review on certiorari before this Court (G.R. No. 153885), the first case
[18] [19]

subject of the present decision.

In the meantime, Branch 135 of the Makati RTC, upon receipt of the above-said February 22, 2002 Decision of the Court
of Appeals, dismissed petitioners complaint-Civil Case No. 01-087 by Order of March 1, 2002. On petitioners motion, the
[20]

trial court, by Order of April 23, 2002, suspended the effectivity of its March 1, 2002 Order in light of the pendency of
[21]

petitioners motion for reconsideration of the decision of the Court of Appeals.

The appellate court subsequently, as reflected above, denied petitioners motion for reconsideration by Resolution of
June 6, 2002 following which the trial court issued its Order of September 9, 2002 dismissing Civil Case No. 02-087, it
[22]

holding that petitioners appeal from the appellate court decision before this Court (G.R. No. 153885, the first case) does not
interrupt the course of said civil case unless a temporary restraining order or a writ of preliminary injunction is issued against
it, citing Section 7 of Rule 65, Rules of Court.
Petitioner filed a motion for reconsideration of the September 9, 2002 Order of the trial court which it denied by Order of
November 22, 2002, it holding that the dismissal of petitioners complaint was merely in compliance with the Court of
[23]

Appeals ruling and is deemed final until set aside by the Supreme Court. From these Orders, petitioner appealed to this
Court by petition for review on certiorari (G.R. No. 156214), the second case subject of the present decision.
[24]

Petitioners appeal in the first case is premised on the following grounds:

I. THE COURT OF APPEALS GRAVELY ERRED IN FINDING THAT PETITIONER WAS GUILTY OF FORUM
SHOPPING. THE ELEMENTS OF FORUM SHOPPING ARE NOT PRESENT IN THE CASE AT BAR.
 II. THE COURT OF APPEALS GRAVELY ERRED IN NOT DISMISSING THE PETITION FOR CERTIORARI FOR
LACK OF PROPER VERIFICATION.
Petitioner claims that the issues/matters raised before the RTC of Makati and those before the MGB are not dependent
on each other. It argues that in bringing its July 12, 2000 Sale and Purchase Agreement with WMC to the knowledge of the
DENR, it was merely requesting for the consent of the Secretary to the transfer of WMCPs FTAA to it, it not having raised
any contentious issues before said office; and that the request merely called for MGB to review the respective financial and
technical qualifications of both petitioner and respondent Tampakan Companies to determine who between them is fit to
become the transferee of the FTAA.
With respect to the case before the RTC, petitioner asserts that what are principally raised therein are the non-
performance by respondent WMC of its obligations to petitioner under their contract of sale and the validity of WMCs
subsequent agreements with the Tampakan Companies.
Petitioner adds that the MGB is not being made to exercise quasi-judicial power or function but only recommendatory or
administrative functions in contrast to what the RTC is being called upon to do.
Petitioner thus concludes that there could be no forum shopping in light of the difference in the nature of the proceedings
before the two fora.
Finally, petitioner underscores that the petition brought by respondents before the Court of Appeals should have been
dismissed for not having been properly verified by WMC.
Petitioners ratiocinations do not persuade. It is clear from the proceedings before the DENR, specifically before the
MGB, that the issue of which between petitioner and respondent Tampakan Companies possesses the better right to
acquire the mining rights, claims and interests held by WMC through its local subsidiary WMCP, especially with respect to
the 1995 FTAA, had been brought to the fore. The MGB cannot just assess the qualifications of petitioner and of the
Tampakan Companies as potential transferee or assignee of the rights and obligations of WMCP under the FTAA without
also resolving the issue of which has priority of right to become one.
True, the questioned agreements of sale between petitioner and WMC on one hand and between WMC and the
Tampakan Companies on the other pertain to transfer of shares of stock from one entity to another. But said shares of stock
represent ownership of mining rights or interest in mining agreements. Hence, the power of the MGB to rule on the validity of
the questioned agreements of sale, which was raised by petitioner before the DENR, is inextricably linked to the very nature
of such agreements over which the MGB has jurisdiction under the law. Unavoidably, there is identity of reliefs that petitioner
seeks from both the MGB and the RTC.
Forum shopping exists when both actions involve the same transactions, same essential facts and circumstances and
raise identical causes of actions, subject matter, and issues. Such elements are evidently present in both the proceedings
[25]
before the MGB and before the trial court. The case instituted with the RTC was thus correctly ordered dismissed by the
appellate court on the ground of forum shopping. Besides, not only did petitioner commit forum shopping but it also failed to
exhaust administrative remedies by opting to go ahead in seeking reliefs from the court even while those same reliefs were
appropriately awaiting resolution by the MGB.
As for petitioners assailing of respondents petition for certiorari before the Court of Appeals for not being properly
verified by WMC, the same fails. The verification and certification against forum shopping of the petition was signed by a
duly authorized officer of WMC in the person of Terence Gardner, Chairman of the Board and President of WMCP, who was
the signing representative of WMC in the July 12, 2000 Sale and Purchase Agreement with petitioner.
With respect to the second case (G.R. No. 156214), this Court sets aside the appealed Orders of the trial court
dismissing Civil Case No. 01-087. The orders are patently erroneous for the appellate courts decision directing the
dismissal of the said civil case had not yet become final and executory, the appeal therefrom by petitioner to this Court-
subject of the herein first case having been duly perfected.
WHEREFORE, judgment is hereby rendered in 1) G.R. No. 153885 AFFIRMING the assailed Decision of the Court of
Appeals, and 2) G.R. No. 156214 SETTING ASIDE the assailed Orders of Branch 135 of the Makati Regional Trial Court.
SO ORDERED.
G.R. No. 152644 February 10, 2006
JOHN ERIC LONEY, STEVEN PAUL REID and PEDRO B. HERNANDEZ, Petitioners,
vs.
PEOPLE OF THE PHILIPPINES, Respondent.
DECISION
CARPIO, J.:
The Case
This is a petition for review1 of the Decision2 dated 5 November 2001 and the Resolution dated 14 March 2002 of the Court of Appeals. The 5 November 2001
Decision affirmed the ruling of the Regional Trial Court, Boac, Marinduque, Branch 94, in a suit to quash Informations filed against petitioners John Eric Loney,
Steven Paul Reid, and Pedro B. Hernandez ("petitioners"). The 14 March 2002 Resolution denied petitioners motion for reconsideration.
The Facts
Petitioners John Eric Loney, Steven Paul Reid, and Pedro B. Hernandez are the President and Chief Executive Officer, Senior Manager, and Resident Manager
for Mining Operations, respectively, of Marcopper Mining Corporation ("Marcopper"), a corporation engaged in mining in the province of Marinduque.
Marcopper had been storing tailings3 from its operations in a pit in Mt. Tapian, Marinduque. At the base of the pit ran a drainage tunnel leading to the Boac and
Makalupnit rivers. It appears that Marcopper had placed a concrete plug at the tunnels end. On 24 March 1994, tailings gushed out of or near the tunnels end.
In a few days, the Mt. Tapian pit had discharged millions of tons of tailings into the Boac and Makalupnit rivers.
In August 1996, the Department of Justice separately charged petitioners in the Municipal Trial Court of Boac, Marinduque ("MTC") with violation of Article
91(B),4 sub-paragraphs 5 and 6 of Presidential Decree No. 1067 or the Water Code of the Philippines ("PD 1067"),5 Section 86 of Presidential Decree No. 984 or
the National Pollution Control Decree of 1976 ("PD 984"),7 Section 1088 of Republic Act No. 7942 or the Philippine Mining Act of 1995 ("RA 7942"),9 and Article
36510 of the Revised Penal Code ("RPC") for Reckless Imprudence Resulting in Damage to Property.11
Petitioners moved to quash the Informations on the following grounds: (1) the Informations were "duplicitous" as the Department of Justice charged more than
one offense for a single act; (2) petitioners John Eric Loney and Steven Paul Reid were not yet officers of Marcopper when the incident subject of the
Informations took place; and (3) the Informations contain allegations which constitute legal excuse or justification.
The Ruling of the MTC
In its Joint Order of 16 January 1997 ("Joint Order"), the MTC12 initially deferred ruling on petitioners motion for lack of "indubitable ground for the quashing of
the [I]nformations x x x." The MTC scheduled petitioners arraignment in February 1997. However, on petitioners motion, the MTC issued a Consolidated Order
on 28 April 1997 ("Consolidated Order"), granting partial reconsideration to its Joint Order and quashing the Informations for violation of PD 1067 and PD 984.
The MTC maintained the Informations for violation of RA 7942 and Article 365 of the RPC. The MTC held:
[T]he 12 Informations have common allegations of pollutants pointing to "mine tailings" which were precipitately discharged into the Makulapnit and Boac Rivers
due to breach caused on the Tapian drainage/tunnel due to negligence or failure to institute adequate measures to prevent pollution and siltation of the
Makulapnit and Boac River systems, the very term and condition required to be undertaken under the Environmental Compliance Certificate issued on April 1,
1990.
The allegations in the informations point to same set [sic] of evidence required to prove the single fact of pollution constituting violation of the Water Code and
the Pollution Law which are the same set of evidence necessary to prove the same single fact of pollution, in proving the elements constituting violation of the
conditions of ECC, issued pursuant to the Philippine Mining Act. In both instances, the terms and conditions of the Environmental Compliance Certificate were
allegedly violated. In other words, the same set of evidence is required in proving violations of the three (3) special laws.
After carefully analyzing and weighing the contending arguments of the parties and after taking into consideration the applicable laws and jurisprudence, the
Court is convinced that as far as the three (3) aforesaid laws are concerned, only the Information for [v]iolation of Philippine Mining Act should be maintained. In
other words, the Informations for [v]iolation of Anti-Pollution Law (PD 984) and the Water Code (PD 1067) should be dismissed/quashed because the elements
constituting the aforesaid violations are absorbed by the same elements which constitute violation of the Philippine Mining Act (RA 7942).
Therefore, x x x Criminal Case[] Nos. 96-44, 96-45 and 96-46 for [v]iolation of the Water Code; and Criminal Case[] Nos. 96-47, 96-48 and 96-49 for [v]iolation of
the Anti-Pollution Law x x x are hereby DISMISSED or QUASHED and Criminal Case[] Nos. 96-50, 96-51 and 96-52 for [v]iolation of the Philippine Mining Act
are hereby retained to be tried on the merits.
The Information for [v]iolation of Article 365 of the Revised Penal Code should also be maintained and heard in a full blown trial because the common accusation
therein is reckless imprudence resulting to [sic] damage to property. It is the damage to property which the law punishes not the negligent act of polluting the
water system. The prosecution for the [v]iolation of Philippine Mining Act is not a bar to the prosecution for reckless imprudence resulting to [sic] damage to
property.13
The MTC re-scheduled petitioners arraignment on the remaining charges on 28 and 29 May 1997. In the hearing of 28 May 1997, petitioners manifested that
they were willing to be arraigned on the charge for violation of Article 365 of the RPC but not on the charge for violation of RA 7942 as they intended to appeal
the Consolidated Order in so far as it maintained the Informations for that offense. After making of record petitioners manifestation, the MTC proceeded with the
arraignment and ordered the entry of "not guilty" pleas on the charges for violation of RA 7942 and Article 365 of the RPC.
Petitioners subsequently filed a petition for certiorari with the Regional Trial Court, Boac, Marinduque, assailing that portion of the Consolidated Order
maintaining the Informations for violation of RA 7942. Petitioners petition was raffled to Branch 94. For its part, public respondent filed an ordinary appeal with
the same court assailing that portion of the Consolidated Order quashing the Informations for violation of PD 1067 and PD 984. Public respondents appeal was
raffled to Branch 38. On public respondents motion, Branch 38 ordered public respondents appeal consolidated with petitioners petition in Branch 94.
The Ruling of Branch 94
In its Resolution14 of 20 March 1998, Branch 94 granted public respondents appeal but denied petitioners petition. Branch 94 set aside the Consolidated Order
in so far as it quashed the Informations for violation of PD 1067 and PD 984 and ordered those charges reinstated. Branch 94 affirmed the Consolidated Order in
all other respects. Branch 94 held:
After a careful perusal of the laws concerned, this court is of the opinion that there can be no absorption by one offense of the three other offenses, as [the] acts
penalized by these laws are separate and distinct from each other. The elements of proving each violation are not the same with each other. Concededly, the
single act of dumping mine tailings which resulted in the pollution of the Makulapnit and Boac rivers was the basis for the information[s] filed against the accused
each charging a distinct offense. But it is also a well-established rule in this jurisdiction that
"A single act may offend against two or more entirely distinct and unrelated provisions of law, and if one provision requires proof of an additional fact or element
which the other does not, an acquittal or conviction or a dismissal of the information under one does not bar prosecution under the other. x x x."
xxxx
[T]he different laws involve cannot absorb one another as the elements of each crime are different from one another. Each of these laws require [sic] proof of an
additional fact or element which the other does not although they stemmed from a single act.15
Petitioners filed a petition for certiorari with the Court of Appeals alleging that Branch 94 acted with grave abuse of discretion because (1) the Informations for
violation of PD 1067, PD 984, RA 7942 and the Article 365 of the RPC "proceed from and are based on a single act or incident of polluting the Boac and
Makalupnit rivers thru dumping of mine tailings" and (2) the duplicitous nature of the Informations contravenes the ruling in People v. Relova.16Petitioners further
contended that since the acts complained of in the charges for violation of PD 1067, PD 984, and RA 7942 are "the very same acts complained of" in the charge
for violation of Article 365 of the RPC, the latter absorbs the former. Hence, petitioners should only be prosecuted for violation of Article 365 of the RPC.17
The Ruling of the Court of Appeals
In its Decision of 5 November 2001, the Court of Appeals affirmed Branch 94s ruling. The appellate court held:
The records of the case disclose that petitioners filed a motion to quash the aforementioned Informations for being duplicitous in nature. Section 3 of Rule 117 of
the Revised Rules of Court specifically provides the grounds upon which an information may be quashed. x x x
xxxx
[D]uplicity of Informations is not among those included in x x x [Section 3, Rule 117].
xxxx
We now go to petitioners claim that the resolution of the public respondent contravened the doctrine laid down in People vs. Relova for being violative of their
right against multiple prosecutions.
In the said case, the Supreme Court found the Peoples argument with respect to the variances in the mens rea of the two offenses being charged to be correct.
The Court, however, decided the case in the context of the second sentence of Article IV (22) of the 1973 Constitution (now under Section 21 of Article III of the
1987 Constitution), rather than the first sentence of the same section. x x x
xxxx
[T]he doctrine laid down in the Relova case does not squarely apply to the case at Bench since the Informations filed against the petitioners are for violation of
four separate and distinct laws which are national in character.
xxxx
This Court firmly agrees in the public respondents understanding that the laws by which the petitioners have been [charged] could not possibly absorb one
another as the elements of each crime are different. Each of these laws require [sic] proof of an additional fact or element which the other does not, although
they stemmed from a single act. x x x
xxxx
[T]his Court finds that there is not even the slightest indicia of evidence that would give rise to any suspicion that public respondent acted with grave abuse of
discretion amounting to excess or lack of jurisdiction in reversing the Municipal Trial Courts quashal of the Informations against the petitioners for violation of
P.D. 1067 and P.D. 984. This Court equally finds no error in the trial courts denial of the petitioners motion to quash R.A. 7942 and Article 365 of the Revised
Penal Code.18
Petitioners sought reconsideration but the Court of Appeals denied their motion in its Resolution of 14 March 2002.
Petitioners raise the following alleged errors of the Court of Appeals:
I. THE COURT OF APPEALS COMMITTED A R[E]VERSIBLE ERROR IN MAINTAINING THE CHARGES FOR VIOLATION OF THE PHILIPPINE
MINING ACT (R.A. 7942) AND REINSTATING THE CHARGES FOR VIOLATION OF THE WATER CODE (P.D. 1067) AND POLLUTION CONTROL
LAW (P.D. 984), CONSIDERING THAT:
A. THE INFORMATIONS FOR VIOLATION OF THE WATER CODE (P.D. 1067), THE POLLUTION CONTROL LAW (P.D. 984), THE
PHILIPPINE MINING ACT (R.A. 7942) AND ARTICLE 365 OF THE REVISED PENAL CODE PROCEED FROM AND ARE BASED ON A
SINGLE ACT OR INCIDENT OF POLLUTING THE BOAC AND MAKULAPNIT RIVERS THRU DUMPING OF MINE TAILINGS.
B. THE PROSECUTION OF PETITIONERS FOR DUPLICITOUS AND MULTIPLE CHARGES CONTRAVENES THE DOCTRINE LAID DOWN
IN PEOPLE VS. RELOVA, 148 SCRA 292 [1986 THAT "AN ACCUSED SHOULD NOT BE HARASSED BY MULTIPLE PROSECUTIONS FOR
OFFENSES WHICH THOUGH DIFFERENT FROM ONE ANOTHER ARE NONETHELESS EACH CONSTITUTED BY A COMMON SET OR
OVERLAPPING SETS OF TECHNICAL ELEMENTS."
II. THE COURT OF APPEALS COMMITTED A REVERSIBLE ERROR IN RULING THAT THE ELEMENT OF LACK OF NECESSARY OR ADEQUATE
PRECAUTION, NEGLIGENCE, RECKLESSNESS AND IMPRUDENCE UNDER ARTICLE 356 [sic] OF THE REVISED PENAL CODE DOES NOT FALL
WITHIN THE AMBIT OF ANY OF THE ELEMENTS OF THE PERTINENT PROVISIONS OF THE WATER CODE, POLLUTION CONTROL LAW AND
PHILIPPINE MINING ACT CHARGED AGAINST PETITIONERS[.]19
The Issues
The petition raises these issues:
(1) Whether all the charges filed against petitioners except one should be quashed for duplicity of charges and only the charge for Reckless Imprudence
Resulting in Damage to Property should stand; and
(2) Whether Branch 94s ruling, as affirmed by the Court of Appeals, contravenes People v. Relova.
The Ruling of the Court
The petition has no merit.
No Duplicity of Charges in the Present Case
Duplicity of charges simply means a single complaint or information charges more than one offense, as Section 13 of Rule 11020 of the 1985 Rules of Criminal
Procedure clearly states:
Duplicity of offense. A complaint or information must charge but one offense, except only in those cases in which existing laws prescribe a single punishment
for various offenses.
In short, there is duplicity (or multiplicity) of charges when a single Information charges more than one offense.21
Under Section 3(e), Rule 11722 of the 1985 Rules of Criminal Procedure, duplicity of offenses in a single information is a ground to quash the Information. The
Rules prohibit the filing of such Information to avoid confusing the accused in preparing his defense.23 Here, however, the prosecution charged each petitioner
with four offenses, with each Information charging only one offense. Thus, petitioners erroneously invoke duplicity of charges as a ground to quash the
Informations. On this score alone, the petition deserves outright denial.
 The Filing of Several Charges is Proper
Petitioners contend that they should be charged with one offense only Reckless Imprudence Resulting in Damage to Property because (1) all the charges
filed against them "proceed from and are based on a single act or incident of polluting the Boac and Makalupnit rivers thru dumping of mine tailings" and (2) the
charge for violation of Article 365 of the RPC "absorbs" the other charges since the element of "lack of necessary or adequate protection, negligence,
recklessness and imprudence" is common among them.
The contention has no merit.
As early as the start of the last century, this Court had ruled that a single act or incident might offend against two or more entirely distinct and unrelated
provisions of law thus justifying the prosecution of the accused for more than one offense.24 The only limit to this rule is the Constitutional prohibition that no
person shall be twice put in jeopardy of punishment for "the same offense."25 In People v. Doriquez,26 we held that two (or more) offenses arising from the same
act are not "the same"
x x x if one provision [of law] requires proof of an additional fact or element which the other does not, x x x. Phrased elsewise, where two different laws (or
articles of the same code) define two crimes, prior jeopardy as to one of them is no obstacle to a prosecution of the other, although both offenses arise from the
same facts, if each crime involves some important act which is not an essential element of the other.27 (Emphasis supplied)
Here, double jeopardy is not at issue because not all of its elements are present.28 However, for the limited purpose of controverting petitioners claim that they
should be charged with one offense only, we quote with approval Branch 94s comparative analysis of PD 1067, PD 984, RA 7942, and Article 365 of the RPC
showing that in each of these laws on which petitioners were charged, there is one essential element not required of the others, thus:
In P.D. 1067 (Philippines Water Code), the additional element to be established is the dumping of mine tailings into the Makulapnit River and the entire Boac
River System without prior permit from the authorities concerned. The gravamen of the offense here is the absence of the proper permit to dump said mine
tailings. This element is not indispensable in the prosecution for violation of PD 984 (Anti-Pollution Law), [RA] 7942 (Philippine Mining Act) and Art. 365 of the
Revised Penal Code. One can be validly prosecuted for violating the Water Code even in the absence of actual pollution, or even [if] it has complied with the
terms of its Environmental Compliance Certificate, or further, even [if] it did take the necessary precautions to prevent damage to property.
In P.D. 984 (Anti-Pollution Law), the additional fact that must be proved is the existence of actual pollution. The gravamen is the pollution itself. In the absence of
any pollution, the accused must be exonerated under this law although there was unauthorized dumping of mine tailings or lack of precaution on its part to
prevent damage to property.
In R.A. 7942 (Philippine Mining Act), the additional fact that must be established is the willful violation and gross neglect on the part of the accused to abide by
the terms and conditions of the Environmental Compliance Certificate, particularly that the Marcopper should ensure the containment of run-off and silt materials
from reaching the Mogpog and Boac Rivers. If there was no violation or neglect, and that the accused satisfactorily proved [sic] that Marcopper had done
everything to ensure containment of the run-off and silt materials, they will not be liable. It does not follow, however, that they cannot be prosecuted under the
Water Code, Anti-Pollution Law and the Revised Penal Code because violation of the Environmental Compliance Certificate is not an essential element of these
laws.
On the other hand, the additional element that must be established in Art. 365 of the Revised Penal Code is the lack of necessary or adequate precaution,
negligence, recklessness and imprudence on the part of the accused to prevent damage to property. This element is not required under the previous laws.
Unquestionably, it is different from dumping of mine tailings without permit, or causing pollution to the Boac river system, much more from violation or neglect to
abide by the terms of the Environmental Compliance Certificate. Moreover, the offenses punished by special law are mal[a] prohibita in contrast with those
punished by the Revised Penal Code which are mala in se.29
Consequently, the filing of the multiple charges against petitioners, although based on the same incident, is consistent with settled doctrine.
On petitioners claim that the charge for violation of Article 365 of the RPC "absorbs" the charges for violation of PD 1067, PD 984, and RA 7942, suffice it to say
that a mala in se felony (such as Reckless Imprudence Resulting in Damage to Property) cannot absorb mala prohibita crimes (such as those violating PD 1067,
PD 984, and RA 7942). What makes the former a felony is criminal intent (dolo) or negligence (culpa); what makes the latter crimes are the special laws enacting
them.
People v. Relova not in Point
Petitioners reiterate their contention in the Court of Appeals that their prosecution contravenes this Courts ruling in People v. Relova. In particular, petitioners
cite the Courts statement in Relova that the law seeks to prevent harassment of the accused by "multiple prosecutions for offenses which though different from
one another are nonetheless each constituted by a common set or overlapping sets of technical elements."
This contention is also without merit.1avv phil.net

The issue in Relova is whether the act of the Batangas Acting City Fiscal in charging one Manuel Opulencia ("Opulencia") with theft of electric power under the
RPC, after the latter had been acquitted of violating a City Ordinance penalizing the unauthorized installation of electrical wiring, violated Opulencias right
against double jeopardy. We held that it did, not because the offenses punished by those two laws were the same but because the act giving rise to the charges
was punished by an ordinance and a national statute, thus falling within the proscription against multiple prosecutions for the same act under the second
sentence in Section 22, Article IV of the 1973 Constitution, now Section 21, Article III of the 1987 Constitution. We held:
The petitioner concludes that:
"The unauthorized installation punished by the ordinance [of Batangas City] is not the same as theft of electricity [under the Revised Penal Code]; that
the second offense is not an attempt to commit the first or a frustration thereof and that the second offense is not necessarily included in the offense charged in
the first information."
The above argument[ ] made by the petitioner [is] of course correct. This is clear both from the express terms of the constitutional provision involved which
reads as follows:
"No person shall be twice put in jeopardy of punishment for the same offense. If an act is punished by a law and an ordinance, conviction or acquittal under
either shall constitute a bar to another prosecution for the same act." x x x
and from our case law on this point. The basic difficulty with the petitioners position is that it must be examined, not under the terms of the first sentence of
Article IV (22) of the 1973 Constitution, but rather under the second sentence of the same section. The first sentence of Article IV (22) sets forth the general rule:
the constitutional protection against double jeopardy is not available where the second prosecution is for an offense that is different from the offense charged in
the first or prior prosecution, although both the first and second offenses may be based upon the same act or set of acts. The second sentence of Article IV (22)
embodies an exception to the general proposition: the constitutional protection, against double jeopardy is available although the prior offense charged under an
ordinance be different from the offense charged subsequently under a national statute such as the Revised Penal Code, provided that both offenses spring from
the same act or set of acts. x x x30 (Italicization in the original; boldfacing supplied)
Thus, Relova is no authority for petitioners claim against multiple prosecutions based on a single act not only because the question of double jeopardy is not at
issue here, but also because, as the Court of Appeals held, petitioners are being prosecuted for an act or incident punished by four national statutes and not by
an ordinance and a national statute. In short, petitioners, if ever, fall under the first sentence of Section 21, Article III which prohibits multiple prosecution for the
same offense, and not, as in Relova, for offenses arising from the same incident.
WHEREFORE, we DENY the petition. We AFFIRM the Decision dated 5 November 2001 and the Resolution dated 14 March 2002 of the Court of Appeals.
SO ORDERED.
MARCOPPER MINING CORPORATION, petitioner, vs. ALBERTO G. BUMOLO in his own behalf and as Attorney-in-Fact of Benito
Cachili, Conchita Bumolo, Patricio Dumlao, Jacinto Aliguyon, Alfonso Maddawat, Toledo Gillao, Jose Tigo and Peter
Cabiggat Bumolo, DALTON PACIFIC RESOURCES, INC., OROPHILIPPINES VENTURES INC., and the MINES ADJUDICATION
BOARD (MAB), respondents.

DECISION
BELLOSILLO, J.:

MARCOPPER MINING CORPORATION registered its mining claims in Pao, Kasibu, Nueva Vizcaya with the Department of
Environment and Natural Resources (DENR) from 2 February 1982 to 12 October 1982. Private respondents Alberto G. Bumolo, Benito
Cachili, Conchita Bumolo, Patricio Dumlao, Jacinto Aliguyon, Alfonso Maddawat, Toledo Gillao, Jose Tigo and Peter Cabiggat Bumolo and
others, namely, Rosario Camma, Mariano Maddela, Victor Guiaoan and Catalino Randa, registered their mining claims in the same area
from 28 July 1981 to 22 September 1988, which claims were subsequently converted into Mineral Production Sharing Agreements (MPSA).
On 12 March 1982 petitioner entered into Option Agreements over the mining claims with respondent Alberto G. Bumolo, for himself and
as attorney-in-fact of the other respondents on one hand; and with Rosario Camma on the other, for herself and as attorney-in-fact of the
rest. Under the Agreements, petitioner was granted the exclusive and irrevocable right to explore the mining claims for three (3) years with
provision for extension.
On 23 December 1982 and 26 March 1987 petitioner filed Prospecting Permit Applications (PPA) with the Bureau of Forest
Development, DENR, on the alleged ground that a portion of the area covered by the mining claims was within the Magat River Forest
Reservation under Proc. 573 of 26 June 1969 [1] and with the Department of Agrarian Reform (DAR) on account of alleged coverage of the
other portion within the Nueva Vizcaya-Quirino Civil Reservation under Proc. 1498 of 11 September 1975.[2]
On 11 February 1991 and 12 March 1991 petitioner informed respondent Alberto G. Bumolo and Rosario Camma that it was terminating
the Agreements since its conduct of a systematic exploration program disclosed that the area was relatively weak and of limited tonnage
which did not justify further drilling for big tonnage of low grade gold exploration target.
On 15 July 1991 DENR Regional Executive Director Leonardo A. Paat rejected petitioners Prospecting Permit Application (PPA) on the
ground that the Memorandum of 8 July 1991 endorsed by the Regional Technical Director for Mines revealed that the area covered was
outside government reservation; that the prospect claim was in conflict with existing claims; and, that the area had been extensively explored
in the early 1980's.[3]
On 15 August 1991 petitioner moved for reconsideration. On 9 June 1995 Regional Executive Director Samuel Paragas recommended
to the DENR Secretary that petitioner's request for reconsideration be denied; that the existing rights of mining claim holders be respected;
and, that the prior legal rights of MPSA/Financial and Technical Assistance Agreement applicants over subject area be recognized.[4]
As regards petitioner's PPA filed with the DAR, it appeared that it was issued a clearance to prospect for six (6) months from 11
December 1995.[5]
On 15 August 1997 petitioner appealed to public respondent Mines Adjudication Board (MAB), DENR, naming respondents Alberto G.
Bumolo, Benito Cachili, Conchita Bumolo, Patricio Dumlao, Jacinto Aliguyon, Alfonso Maddawat, Toledo Gillao, Jose Tigo and Peter
Cabiggat Bumolo as appellees. Petitioner maintained that subject area was within the Magat River Forest Reservation. On 11 June 1998
the rejection of the PPA was affirmed whereas the mining claims of respondents Alberto G. Bumolo et al. that had been converted into a
MPSA, subject to compliance with R.A. 7942[6] and DAO No. 96-40,[7] were given due course.[8]
On 16 July 1998 petitioner moved for reconsideration. On 29 March 1999 private respondents Dalton Pacific Resources (Dalton) and
Orophilippines Ventures, Inc. (OVI) filed an Omnibus Motion for their joinder as parties on the ground that on 17 July 1992 they had entered
into a Memorandum of Agreement with respondent Alberto G. Bumolo on his own behalf and as attorney-in-fact of Camma, et al. granting
the companies exclusive and irrevocable right to explore and operate the area subject of the mining claims. On 13 May 1999 respondent
MAB denied petitioners motion and formally joined respondents Dalton and OVI with the original appellees as parties in the case. [9]
The only relevant issue raised by petitioner[10] pertains to whether respondent MAB erred in finding that the area subject of the PPA was
outside the Magat River Forest Reservation.
Petitioner notes that the Magat River Forest Reservation has a tie point at coordinates 17 degrees 40'29" and 121 degrees 30'40" in
Nueva Vizcaya which puts the river basin too far to the north. Petitioner submits that an error must have been committed in the
Engineering Section of the DENR by typing the latitude as "17" instead of "16" degrees; if corrected, the river basin would cover exactly
the basin on the ground making the area subject of the PPA within the Magat River Forest Reservation.
The petition lacks merit. Readily apparent is that the issue deals with a factual matter. In this regard, factual findings of quasi-judicial
agencies which have acquired expertise in matters entrusted to their jurisdictions are accorded by this Court not only respect but finality if
supported by substantial evidence.[11] In this instance, there is no reason to disagree with respondent MAB.
We recall that petitioner previously conducted a systematic exploration program of subject area which yielded the result that it was
relatively weak and of limited tonnage and thus did not justify further drilling for big tonnage of low grade gold exploration
target. Consequently, it terminated the Option Agreements with respondents and the group of Camma. This, notwithstanding, it still
showed interest when it filed a PPA over the area. We agree with the observation of Regional Executive Director Paragas and respondent
MAB that petitioners action of filing a PPA over the area it previously found relatively weak and of limited tonnage was absurd.
Respondent MAB correctly upheld the ratiocination of Regional Executive Director Paragas in denying petitioner's PPA, pertinent
portions of which read -
x x x x the said rejection by the region was anchored on the July 8, 1991 Memorandum Report of then RTD for Mines Nestor Punsal, Jr. to
then RED Leonardo A. Paat x x x wherein it was clearly cited that Marcoppers proposed prospecting area covering
about 4,941 hectares lies outside Magat Forest Reserve. Such being the case, a PPA is not the proper instrument for said company to avail
of in order to have the right to prospect over the area. Instead, the filing of Declarations of Location (DOL) would have been proper.
The records, however, show that Marcopper already holds right over some parts of the applied area through its PAO 1-30 mining claims
(2,430 hectares) filed under PD 463 in late 1982. The same report noted that it was rather unusual for Marcopper to have applied for
Prospecting Permit over the same area covered by existing PD 463 claims including that of its own x x x x
The disapproval of Marcoppers PPA moreover, did not emanate from a single recommendation of the RTD for Mines. Records would show
that as early as May 31, 1989 x x x the Bumolo group of PD 463 claims which Marcopper has eventually surrounded by filing its own PAO 1-
30 group of claims x x x x was confirmed by the Forest Engineering Section of the region to be outside proclaimed watershed areas,
wilderness, national parks and existing government reforestation projects x x x x
Then again for Marcopper to include the Bumolo group of claims in its PPA and thereby subject the same to another round of prospecting is
but ridiculous considering that the same company have in the past conducted detailed investigation activities over the same areas and have
accordingly declared said claims to be relatively weak and indicate a quite limited tonnage potential to justify further drilling for possible big
tonnage low grade gold exploration target x x x x
x x x x we wish to expound on the October 17, 1991 explanation previously made by the region in that indeed, the PPA of Marcopper lies
outside of Magat Forest Reserve as per plotting recently provided by NAMRIA per its June 2, 1995 indorsement of the maps to this Office x x
x x[12]
In other words, the circumstance that the area covered by petitioner's PPA is outside the Magat River Forest Reservation has been
adequately established by the following evidence: (a) confirmation as early as 31 May 1989 by the Forest Engineering Section of
Tuguegarao, Cagayan; (b) the 8 July 1991 Memorandum Report of Regional Technical Director Punsal Jr.; and, (c) plotting provided by the
National Mapping and Resources Information Authority per its 2 June 1995 indorsement of the maps to the office of the Regional Executive
Director. Petitioner contests the exclusion of the area subject of its PPA within the Magat River Forest Reservation based merely on the
alleged "typographical error committed by somebody in the Engineering Section of the DENR." Aside from the fact that the allegation does
not have anything to support it, the aforementioned documents which the Regional Executive Directors relied upon in denying the PPA had
already settled the issue.
Furthermore, respondent MAB even fortified the bases for the rejection of petitioner's PPA. As plotted by the Lands Management Sector
of DENR Region 2 contained in the sketch plan of 11 November 1996 and as shown in the Land Use map of the Community Environment
and Natural Resources Office of Dupax, Nueva Vizcaya, the area covered under the PPA is indeed outside any government reservation.
At any rate, we have gone over the pleadings of the parties, i.e., Petition, Comment, Reply, as well as their respective Memoranda, and
we find no justifiable basis to merit a reversal and grant the Petition.
WHEREFORE, the petition is DENIED. The Decision of 11 June 1998 of respondent Mines Adjudication Board which affirmed the
rejection of petitioner Marcopper Mining Corporations Prospecting Permit Application and gave due course to the Mineral
Production Sharing Agreement of respondents Alberto G. Bumolo, Benito Cachili, Conchita Bumolo, Patricio Dumlao, Jacinto Aliguyon,
Alfonso Maddawat, Toledo Gillao, Jose Tigo and Peter Cabiggat Bumolo subject to compliance with RA 7942 and DAO No. 96-40, and its
Resolution of 13 May 1999 which denied reconsideration, are AFFIRMED. Costs against petitioner.
SO ORDERED.
OLYMPIC MINES AND DEVELOPMENT CORP., G.R. No.
Petitioner, 178188

- versus -

PLATINUM GROUP METALS CORPORATION,

Respondent.

x ---------------------------------------------------------------------------------------------- x
CITINICKEL MINES AND DEVELOPMENT CORPORATION, G.R. No.
Petitioner, 180674

- versus -

HON. JUDGE BIENVENIDO C. BLANCAFLOR, in his capacity as the

Presiding Judge of the Regional Trial Court of Palawan, Branch 95,
Puerto Princesa City, Palawan, and PLATINUM GROUP METAL
CORPORATION, Respondents.

x ---------------------------------------------------------------------------------------------- x
PLATINUM GROUP METALS CORPORATION, G.R. No.
Petitioner, 181141

- versus -
CITINICKEL MINES AND DEVELOPMENT CORPORATION, acting
for its own interest and on behalf of OLYMPIC MINES AND
DEVELOPMENT CORPORATION,
Respondent.
x ---------------------------------------------------------------------------------------------- x
PLATINUM GROUP METALS CORPORATION, G.R. No.
Petitioner, 183527

Present:
*
- versus - CARPIO
MORALES, J.

Acting
Chairperson,
COURT OF APPEALS and POLLY C. DY,
Respondents. TINGA,

VELASCO,
JR.,
**
LEONARDO-
DE CASTRO, and

BRION, JJ.

Promulgated:

May 8, 2009
x ---------------------------------------------------------------------------------------------- x

DECISION

BRION, J.:

Before the Court are the following inter-related and subsequently consolidated cases:

1. G.R. No. 178188 is a petition for review on certiorari filed by Olympic Mines and Development Corporation (Olympic)
assailing the decision dated February 28, 2007,[1]and resolution dated May 30, 2007[2] of the Court of Appeals (CA) in CA-G.R.
SP No. 97259, which effectively upheld the jurisdiction of the Regional Trial Court (RTC) of Puerto Princesa City, Branch 95, in
Civil Case No. 4199, and affirmed the injunctive writs issued therein;

2. G.R. No. 180674 is a petition for review on certiorari filed by Citinickel Mines and Develoment Corporation (Citinickel)
assailing the decision dated November 20, 2007 of the CA in CA-G.R. SP No. 99422, which dismissed the petition
for certiorari filed by Citinickel against the injunctive writ[3] issued by the RTC of Puerto Princesa, Branch 95 in Civil Case No.
4199;

3. G.R. No. 183527 is a petition for certiorari filed by Platinum Group Metals Corporation (Platinum), assailing the resolution
dated March 3, 2008 of the CA in CA-G.R. SP No. 101544, which ordered the issuance of a writ of preliminary injunction
enjoining the RTC of Puerto Princesa, Branch 95, from conducting further proceedings in Civil Case No. 4199; and
 4. G.R. No. 181141 is a petition for review on certiorari filed by Platinum against the resolution dated January 18, 2007 of the
CA in CA-G.R. SP No. 97288, which dismissed the petition for certiorari filed by Platinum against the Panel of Arbitrators
(POA) Resolution cancelling the Operating Agreement and its Small Scale Mining Permits (SSMPs).

These four (4) petitions stem from the Operating Agreement entered into by Olympic and Platinum, and the subsequent
attempts made by Olympic, and thereafter its successor-in-interest Citinickel, to unilaterally terminate the same.

FACTUAL BACKGROUND

Operating Agreement between Olympic and Platinum

In 1971 and 1980, Olympic was granted Mining Lease Contracts[4] by the Secretary of the Department of Environment and
Natural Resources (DENR) covering mining areas located in the municipalities of Narra and Espanola, Palawan.

On July 18, 2003, Olympic entered into an Operating Agreement[5] with Platinum, by virtue of which Platinum was given the
exclusive right to control, possess, manage/operate, and conduct mining operations, and to market or dispose mining products on
the Toronto Nickel Mine in the Municipality of Narra, with an area of 768 hectares, and the Pulot Nickel Mine in the Municipality of
Espanola, covering an area of 1,408 hectares (referred to as subject mining areas), for a period of twenty five years. In return,
Platinum would pay Olympic a royalty fee of 2% of the gross revenues.
 Olympic and Platinum applied for, and were subsequently granted the necessary government permits and environmental
compliance certificates.

On April 24, 2006, Olympic sent a letter to Platinum, informing the latter of the immediate termination of the Operating
Agreement on account of Platinums gross violations of its terms, and directing Platinum to immediately surrender possession of
the subject mining areas under the Operating Agreement.

Civil Case No. 4181 and

the Branch 52 Order

On April 25, 2006, Olympic instituted an action for the issuance of an injunctive writ before the RTC of Puerto Princesa,
Branch 52 (docketed as Civil Case No. 4181) against Platinum. In its prayer, Olympic sought to enjoin Platinum from conducting
mining operations on the subject mining areas, and also to recover possession thereof. Civil Case No. 4181 essentially involved the
issue of whether Olympic can unilaterally terminate the Operating Agreement on account of the alleged gross violations
committed by Platinum, and accordingly, prevent the latter from continuing its mining operations. The RTC, through an Order
dated May 16, 2006 (Branch 52 Order), ruled that it did not; the trial court found that Platinum substantially complied with the
terms of the Operating Agreement and declared that Olympics unilateral termination thereof was legally impermissible. [6] The RTC
thus dismissed Olympics complaint.

Administrative Complaints

Instituted by Olympic
 Instead of seeking relief against the Branch 52 Order (which thus became final and executory), Olympic then filed two cases
with different agencies of the DENR:

a. Provincial Mining Regulatory Board (PMRB) Case No. 001-06 (filed on May 18, 2006) for the revocation of the SSMPs of
Platinum, on the ground of Olympics termination of the Operating Agreement because of the alleged gross violations
thereof by Platinum. This was dismissed through a Resolution dated August 16, 2006, on the basis of the Branch 52
Order which found Olympics unilateral rescission of the Operating Agreement to be illegal[7]; and

b. POA Case No. 2006-01-B (filed on June 8, 2006) for the cancellation of the Operating Agreement and the revocation of
the SSMPs of Platinum. This case was subsequently withdrawn by Olympic on June 20, 2006

Assignment of Rights under the Operating Agreement

While these two administrative cases were pending, Olympic transferred its applications for mineral agreements, including
its rights under the Operating Agreement, to Citinickel via a Deed of Assignment dated June 9, 2006, without the knowledge or
consent of Platinum. This assignment was thereafter approved by the Regional Director of the Mines and Geosciences Bureau
(MGB) on September 6, 2006.

Civil Case No. 06-0185

 After the assignment, Citinickel filed Civil Case No. 06-0185 before the RTC of Paraaque, Branch 258, on June 21, 2006,
seeking to invalidate the Operating Agreement based on Platinums alleged violation of its terms. This action was also dismissed
by the trial court, citing forum shopping and
improper venue as among the grounds for dismissal.[8] Citinickel did not bother to appeal this dismissal, opting instead to find
other remedies.
Administrative Cases

Instituted by Citinickel

Citinickel thereafter filed three administrative cases: PMRB Case No. 002-06, DENR Environmental Management Bureau
(EMB) Case No. 8253, and POA Case No. 2006-02-B.

PMRB Case No. 002-06, where Citinickel sought the cancellation of Platinums SSMPs, was dismissed through a Resolution
dated September 12, 2006, on the basis of the injunctive writ issued in Civil Case No. 4199, as well as the finding of the PMRB that
Citinickel committed forum shopping.[9]

DENR EMB Case No. 8253 was instituted by Citinickel requesting for the cancellation of the Environmental Compliance
Certificates (ECCs) of Platinum; although granted by the EMB, and later affirmed by the DENR Secretary, the cancellation of
Platinums ECCs was reversed by the Office of the President.

While Civil Case No. 06-0185 (for the rescission of the Operating Agreement) was pending before the RTC of Paranaque,
Citinickel filed a complaint, docketed as POA Case No. 002-06-B, with the POA of DENR, asking for a writ of injunction against
Platinum and for the cancellation of the Operating Agreement. This time, Citinickels relentless efforts to have the Operating
Agreement cancelled bore fruit the POA issued a Resolution dated October 30, 2006 (POA Resolution)[10] that cancelled the
Operating Agreement as well as Platinums SSMPs, and ordered Platinum to cease and desist from operating the subject mining
areas.
 Through a petition for certiorari, Platinum questioned the POA Resolution before the CA; the case was docketed as CA-G.R.
SP No. 97288. The appellate court, however, dismissed Platinums certiorari petition,[11] upon finding that Platinum failed to file a
motion for reconsideration of the POA Resolution with the Mines Adjudication Board (MAB) the body which has appellate
jurisdiction over decisions or orders of the POA pursuant to Section 78 of the Republic Act No. 7942 or the Philippine Mining Act of
1995 (Mining Act) before elevating the case to the CA.

Protesting the dismissal of its certiorari petition, Platinum filed before the Court one of the four petitions involved in these
consolidated cases G.R. No. 181141. Platinum contends that the non-filing of an appeal (through a motion for reconsideration)
with the MAB would be useless, as the POA declared that its decision to cancel the Operating Agreement was not just its own, but
also that of the DENR, which includes the MAB. Additionally, Platinum claimed that the POA Resolution[12] was patently illegal, as it
contravened the injunctive writs issued in Civil Case No. 4199 (discussed next), thus the immediate need to invoke the appellate
courts certiorari jurisdiction.

Civil Case No. 4199

and the Injunctive Writs

Civil Case No. 4199 involved a complaint for quieting of title, damages, breach of contract, and specific performance filed by
Platinum against Olympic before the RTC of Puerto Princesa, Palawan, Branch 95 on June 14, 2006. The proceedings and the
orders issued in this case became the subject of three of the four consolidated petitions now pending with the Court G.R. Nos.
178188, 180674, and 183527. The RTCs narration provides us with a background of Civil Case No. 4199:

Alleging that Olympics claims and misrepresentation in the letters dated April 24, 2006 [referring to the termination
letter sent by Olympic to Platinum], May 18, 2006 [referring to the letter-complaint of Olympic filed in PMRB Case No.
001-06 which sought the revocation of Platinums SSMPs], and June 6, 2008 [referring to the letter of Olympic notifying
 Platinum of its intention to file legal action against Platinum for gross violations of the Operating Agreement], xxx Platinum
filed with Branch 95 of the RTC of Puerto Princessa City on June 14, 2006, a complaint to quiet Platinums title/interest
over the subject mining areas, to recover damages and to compel Olympic to perform its obligations under the Operating
Agreement.

xxx xxx xxx

On July 21, 2006, upon xxx Platinums motion, xxx Blancaflor, in his capacity as the presiding judge of the RTC of
Puerto Princesa, Branch 95, issued [an] xxx order in Civil Case No. 4199, granting xxx Platinums application for the
issuance of a writ of preliminary injunction xxx directing Olympic, and its successor-in-interest, xxx Citinickel, to cease
and desist from performing any act that would tend to impede, hamper, limit, or adversely affect xx Platinums full
enjoyment of its rights under the Operating Agreement xxx.

xxx xxx xxx

Meanwhile, on August 28, 2006, xxx Platinum filed a Motion for Leave to Amend Complaint, attaching thereto the
Amended Complaint, which impleaded Olympics Board of Directors and Rockworks Resources Corporation (Rockworks)
and the latters Board of Directors as additional defendants.[13] [Emphasis supplied.]

Olympic sought the dismissal of Platinums Civil Case No. 4199 through a motion to dismiss where Olympic alleged that the
trial court was without jurisdiction to rule on the issues raised in the case. Olympic contended that the case involved a mining
dispute requiring the technical expertise of the POA; accordingly, jurisdiction should be with the POA. The RTC denied the motion
to dismiss in a Resolution dated August 15, 2006. When Olympic failed to secure a reversal of the RTCs August 15 Resolution, it
filed an appeal with the CA, docketed as CA-G.R. SP No. 97259. The CA declared that the trial court properly exercised jurisdiction
over Civil Case No. 4199 because the main issue therein was whether Platinum had a claim and/or right over the subject mining
areas pursuant to the Operating Agreement. The dismissal of its petition before the CA prompted Olympic to elevate the matter
with this Court, through a petition for review on certiorari, docketed as G.R. No. 178188.
Citinickel, for its part, filed its own certiorari petition before the CA (CA-G.R. SP No. 99422), and questioned the injunctive
writs issued in Civil Case No. 4199. It claimed that the writ of preliminary injunction cannot be enforced against it since it was not
impleaded in the case even if it was an indispensable party; Olympics rights under the Operating Agreement had already been
transferred to it by virtue of the June 9, 2006 Deed of Assignment. The appellate court nonetheless dismissed Citinickels petition,
prompting the latter to file an appeal by certiorari with this Court, docketed as G.R. No. 180674.

Polly Dy, as a member of Rockworks Board of Directors who was impleaded as co-defendant of Olympic in Civil Case No.
4199, filed her own certiorari petition (docketed as CA-G.R. SP No. 101544) against the injunctive writs issued by the trial court in
the same case. Acting favorably for Polly Dy, the CA directed the issuance of a writ of preliminary injunction against the RTC of
Puerto Princesa, Branch 95, enjoining it from conducting further proceedings in Civil Case No. 4199. Through a petition
forcertiorari, docketed as G.R. No. 183527, Platinum asks the Court to annul the writ of preliminary injunction issued by the CA in
CA-G.R. SP No. 101544.

Civil Case No. Q-07-59855

Notwithstanding the injunctive writ issued in Civil Case No. 4199 ordering Olympic/Citinickel to respect the rights of
Platinum under the Operating Agreement (including its right to control, possess, and operate the subject mining areas), Citinickel
instituted a mandamus petition with the RTC of Quezon City, Branch 100 (docketed as Civil Case No. Q-07-59855), for the DENR
Secretary to confiscate and maintain custody and possession of the mineral ores stockpiled at the Palawan Pier until the
determination of the rights of Citinickel and Platinum under the Operating Agreement. While the trial court initially issued
a status quo order, it eventually dismissed the Citinickels petition for mandamusin its Decision dated May 4, 2007, for Citinickels
failure to prove a clear legal right on its part to justify the issuance of a mandamus writ in its favor, and also for forum shopping.[14]
 For a more graphic presentation, these cases are presented hereunder in tabular form:

CASE NUMBER PARTIES CAUSE OF ACTION STATUS

Complaint
Civil Case No. 4181 forinjunction to May 16, 2006 Order dismissing the
Olympic v. enjoin Platinum from complaint for injunction after
finding that unilateral termination of
(RTC Palawan, Platinum continuing mining the Operating Agreement was illegal
(Branch 52 Order).
Branch 52) activities filed Olympic did not appeal the Order.
on April 25, 2006

August 16,
Complaint for 2006 Resolution
PMRB Case No. Olympic v. revocation of dismissing complaint on
001-06 Platinum Platinums SSMPs the basis of the Branch
dated May 18, 2006 52 Order, which had
become final and
executory.
July 21, 2005 Order
Civil Case No. 4199 granting the writ of
preliminary injunction
Complaint for against Olympic and
Platinum v. quieting of title, Citinickel
(RTC Palawan, Olympic damages, and
Branch 95) specific performance August 15, 2006 Order
denying Olympics motion
to dismiss/suspend
proceedings

DENR POA Case Olympic v. Petition to cancel June 20, 2006 Notice of
 CASE NUMBER PARTIES CAUSE OF ACTION STATUS

No. 2006-01-B Platinum Operating Withdrawal filed by

Agreement and Olympic
revoke Platinums
SSMPs dated June 8,
2006

December 22,
2006 Order dismissing
Civil Case No. 06- Complaint to rescind complaint on the ground
0185 Citinickel v. Operating of forum shopping and
Platinum Agreement improper venue.
(RTC Paranaque) dated June 21, 2006
Citinickel did not appeal
the Order.

September 12,
2006Resolution
dismissing the petition on
Petition to cancel
PMRB Case No. Citinickel v. the basis of the injunctive
Platinums SSMPs
002-06 Platinum writ issued in Civil Case
dated July 12, 2006
No. 4199 and the forum
shopping committed by
Citinickel.

Complaint to cancel
Operating October 30, 2006
Agreement and to Resolution cancelling OA
DENR POA Case Citinickel v
issue injunction and SSMP of
No. 2006-02-B Platinum
against Platinum(POA
Platinum datedJuly Resolution)
19, 2006

EMB letter- Complaint to cancel Elevated to DENR

Citinickel v.
complaints filed as ECCs issued to Secretary by Citinickel on
 CASE NUMBER PARTIES CAUSE OF ACTION STATUS

DENR EMB Case Platinum Platinum dated July account of alleged

No. 8253 31, 2006 inaction of EMB

Sept 25, 2006 Order of

DENR Secretary cancelling
the ECCs issued to
Platinum

Nov 22 Order denying MR

of Platinum

Feb 26, 2007 Decision of

the Office of the
President reversing DENR
Secretarys Order that
cancelled the ECCs

Petition for
mandamus to
Civil Case No. Q-07- compel DENR May 4, 2007 Order
59855 Secretary to dismissing the petition for
Citinickel v. DENR
(RTC Quezon City, confiscate and hold lack of merit and forum
Branch 76) mineral ores shopping.
stockpiled
in Palawanpier
 THE PETITIONS

G.R. No. 178188 on Jurisdiction and Venue in Civil Case No. 4199

In its petition before the Court,[15] Olympic assails the CA Decision[16] dated February 28, 2007 in CA-G.R. SP No. 97259, in
which the appellate court affirmed the October 4,[17] and 5[18] 2006 Orders of the RTC of Puerto Princesa, Palawan in Civil Case No.
4199. The CA declared that the trial court properly exercised jurisdiction over Platinums complaint in Civil Case No. 4199 because
the main issue raised therein was whether Platinum had a claim and/or right over the subject mining areas, pursuant to the
Operating Agreement, and the resolution of this issue did not require the technical expertise of the POA. Moreover, the CA
declared that venue was properly laid in the RTC of Puerto Princesa (where the disputed mining areas are located) because it was
an action affecting an interest in real property that was commenced and tried in a court that has jurisdiction over the area of the
real property. Lastly, the CA found that the lower court had not abused its discretion when it issued the writ of preliminary
injunction prayed for by Platinum. Olympics motion for reconsideration of the CAs decision was denied in the May 30,
2007 Resolution of the CA for lack of merit.

Olympic however asserts that it is the POA which has exclusive jurisdiction over the complaint filed by Platinum in Civil Case
No. 4199 because the case involves a mining dispute that requires the technical expertise of the POA. Olympic additionally
contends that the complaint is a personal action because Platinum sought a declaration that it did not violate the Operating
Agreement, and was asking its enforcement; as a personal action, the case should have been filed in the place where either the
plaintiff or the defendant resides, at the election of the plaintiff, and not the court where the property is located.

Platinum, on the other hand, opposes Olympics contentions, claiming that Olympic itself had already recognized the
authority of the trial court to resolve the dispute by instituting Civil Case No. 4181 before the RTC of Puerto Princesa, Branch 52
(the injunction case filed by Olympic against Platinum that was dismissed for lack of merit). Incidentally, Platinum points out that
Olympic had committed forum shopping because aside from Civil Case No. 4181, it filed several other administrative cases, all
grounded on Platinums alleged violation of the Operating Agreement.

With regard to the issue of venue, Platinum claims that its principal objective in instituting Civil Case No. 4199 was to retain
possession of the subject mining areas it was therefore a real action properly filed in the Puerto Princesa court that had
jurisdiction over the areas.

G.R. No. 183527 on the

Injunction against the Proceedings in Civil Case No. 4199

While the jurisdiction of the RTC of Puerto Princesa, Branch 95 was upheld by the CAs Special Fifth Division in CA-G.R. SP No.
97259, the 15th Division of the appellate court, on the other hand, enjoined (through a Resolution[19] dated March 2, 2008, in CA-
G.R. SP No. 101544) the same trial court from conducting further proceedings in Civil Case No. 4199 and
from implementing its Orders dated July 21, 2006,[20] October 26, 2006,[21] and April 13, 2007.[22]

In assailing the CAs 15th Divisions Resolution dated March 2, 2008 (through the present petition for review on certiorari)[23],
Platinum principally argues that Polly Dy the petitioner in CA-G.R. SP No. 97259 had no standing to question the injunctive writs
issued in Civil Case No. 4199 because none of the writs were directed against Polly Dy. Additionally, Polly Dy did not file a motion
for reconsideration of the assailed Orders of the trial court, rendering her CA certiorari petition fatally defective for being
premature.

G.R. 180674 on Citinickels inclusion in the injunctive writs issued in Civil Case No.
4199

Citinickel questions the CA Decision[24] in CA-G.R. SP No. 99422, which dismissed for lack of merit its petition for certiorari,
assailing the July 21, 2006[25] and April 13, 2007[26] Orders of the RTC in Civil Case No. 4199.

Citinickel assails the CA Decision through this petition,[27] asserting that by virtue of the Deed of Assignment dated June 9,
2006, it became an assignee of Olympic before Platinum filed its complaint (Civil Case No. 4199) on June 14, 2006, and thus
claims to be an indispensable party to the case. Since it was not impleaded as a party to Civil Case No. 4199, it cannot be bound by
the writ of preliminary injunction issued by the trial court; for the same reason, the POA Resolution issued in the case filed by
Citinickel cannot be deemed to have contravened the writ of preliminary injunction issued in Civil Case No. 4199.

Platinum counters that the injunction orders are binding on Citinickel because the assignment of Olympics rights to
Citinickel only took effect upon the approval thereof by the Regional Director, which approval was issued only in September 6,
2006 or after Civil Case No. 4199 was filed on June 14, 2006. Thus, Citinickel is a successor-in-interest by title, and is therefore
bound by the injunction orders issued in the case. Platinum also alleges that Citinickel merely stepped into the shoes of Olympic
and acted as the latters agent.

G.R. No. 181141 on the validity of the POA Resolution

In its Petition for Review,[28] Platinum assails the CA Resolution[29] in CA-G.R. SP No. 97288, which dismissed its petition
for certiorari questioning the POA Resolution for having failed to previously file a motion for reconsideration with the POA. The CA
also denied Platinums motion for reconsideration in its Resolution[30] dated December 21, 2007.

Platinum claims that it chose not to file a motion for reconsideration of the POA Resolution in DENR Case No. 2006-02-B
because that motion would have been denied by the POA as it had already affirmed the cancellation of Platinums ECCs in DENR
Case No. 8253. Further, an appeal to the MAB would also be useless because the POA had declared that the decision to cancel the
Operating Agreement and the SSMPs was not entirely its (POAs) own, but also that of the DENR, which includes the MAB.
Platinum contends that it had to file the petition for certiorari because the POA Resolution was patently illegal as it effectively
nullified the injunctive writ previously issued by the lower court in Civil Case No. 4199.

THE COURTS RULING

The key matter in resolving all four petitions involves the issue of jurisdiction that is, which body has the authority to hear
and decide the dispute between Olympic/Citinickel and Platinum, as parties to the operating agreement.
Jurisdiction of the Panel of Arbitrators

Settled is the rule that jurisdiction of the court over the subject matter is determined by the allegations of the complaint.[31]

In Civil Case No. 4199, Platinum alleges in its complaint[32] the following:

3. Plaintiff is engaged in mining operations. Defendant holds mining rights/claims over the Toronto Nickel Mine in the
Municipality of Narra and the Pulot Nickel Mine in the Municipality of Espanola (hereinafter, the subject mining
areas) in Palawan.

4. On 18 July 2003, plaintiff, as the SECOND PARTY, and defendant, as the FIRST PARTY, entered into an Operating
Agreement. The said Agreement vested plaintiff with, among others, the following rights and interests:

2.1 To enter, occupy, possess, explore, develop, utilize and control the mineral properties subject to Section 2,
hereof;

2.2 To conduct mining and all subsidiaries, associated and other related operations in the mineral properties at a
rate it deems appropriate;

2.3 To mill, beneficiate and process the ores by appropriate methods or process within or outside the area of the
mineral properties;

xxx
5. Section 23 of the Operating Agreement states that it shall be effective for twenty-five (25) years or for the life of the
subject mining areas. Under Section 19 thereof, it may only be [pre]terminated for gross violations of its terms and
provisions.

xxx

9. On 24 April 2006, plaintiff was shocked when it received a letter of even date from defendants counsel alleging that
plaintiff has committed gross violations of the Operating Agreement, informing plaintiff of its immediate termination
and the suspension of the mining operations, and demanding that plaintiff surrender the possession of the subject
mining areas.

xxx

17. Defendant claims and declares in the letter dated 24 April 2006, the complaint dated 25 April 2006, the letter dated 18
May 2006 and the letter dated 8 June 2006 that it has already terminated the Operating Agreement. As ground for
termination as well as purported basis for its complaint and its application for TRO, defendant insidiously alleged that
plaintiff committed gross violations of the Operating Agreement.

18. Defendants claims and misrepresentations in said letters and complaint have cast a cloud on plaintiffs rights and
interests over the subject mining areas. The said letters and complaint unequivocally give the impression that, since the
 Operating Agreement has already been terminated, plaintiff no longer possesses any right or interest over the subject
mining areas.

xxx

21. Defendants actions are clearly in breach of the Operating Agreement. To repeat, the Operating Agreement provides
that it may only be [pre]terminated for gross violations of its terms and provisions. As stated above, however,
defendants allegations with respect to plaintiffs violations of the terms and conditions of the Operating Agreement
are merely imagined.

22. In any case, even assuming in gratia argumenti that there is factual basis for defendant to terminate the Operating
Agreement, defendants termination thereof is clearly bereft of legal basis and in breach of the Operating Agreement.
Section 20 unambiguously provides:

The FIRST PARTY may terminate this agreement by giving thirty (30) days notice to the SECOND PARTY based
on gross violation of the terms and conditions of this agreement.

23. Clearly, the Operating Agreement may only be considered terminated after the lapse of 30 days. In the instant case,
defendant served plaintiff the letter dated 24 April 2006 on even date and filed a complaint the following day. The
complaint if filed and the TRO it caused to be issued were thus premature and violative of the Operating Agreement.
 From these allegations, we learn that Platinum had rights and interest in real property, specifically, the right to possess and
to mine the subject mining areas for a certain period of time, as stated in the Operating Agreement. Olympic, however, had cast a
cloud on its interest when: (a) Olympic sent Platinum a letter claiming that it had already terminated the Operating Agreement; (b)
Olympic filed a complaint with the RTC Puerto Princesa, Palawan, Branch 52 (docketed as Civil Case No. 4181), asking the court to
enjoin Platinum from conducting mining operations under the Operating Agreement, since this Agreement had already been
unilaterally terminated by Olympic; and (c) Olympic wrote to the Governor of Palawan to inform him that its Operating Agreement
with Platinum was already terminated and to request that the Governor revoke Platinums SSMPs. Olympics act clearly indicated
its intent to deprive Platinum of its rights, prompting the latter to file the complaint to quiet its title or interest in the subject
mining areas and remove all doubts as to the Agreements continuous effectivity. Platinums primary objective was to protect its
interest in the subject mining areas covered by the Operating Agreement, specifically, under Section 2.12 and 3.4, both are obliged
to maintain the validity and subsistence of the mining rights subject of the agreement.[33] It is thus obvious that the complaint
falls within the ambit of the RTCs original jurisdiction, to the exclusion of all other judicial or quasi-judicial bodies.[34]

Olympic, through its petition in G.R. No. 178188, contends that jurisdiction should instead be with the POA. It posits that to
fall under the jurisdiction of the POA, the dispute must necessarily involve questions of facts or matters requiring the application
of technological knowledge and expertise or which needs the interpretation and the application of particular knowledge and
expertise possessed by the members of the Panel. It reads Platinums complaint in Civil Case No. 4199, to be a matter involving a
mining dispute that raises questions of facts or matters requiring the application of technical knowledge and expertise of the POA
an interpretation that we cannot sustain in light of the clear wording of the law.[35]

The POAs jurisdiction is set forth in Section 77 of the Mining Act:

Sec. 77. Panel of Arbitrators. xxx. Within thirty (30) working days, after the submission of the case by the parties
for decision, the panel shall have exclusive and original jurisdiction to hear and decide on the following:
 a. Disputes involving rights to mining areas;

b. Disputes involving mineral agreements or permits;

c. Disputes involving surface owners, occupants and claimholders/concessionaires; and

d. Disputes pending before the Bureau and the Department at the date of the effectivity of this Act. [Emphasis supplied.]

Section 77, paragraphs (a) and (b) are the provisions principally invoked in this case to confer jurisdiction over the dispute between
Olympic/Citinickel and Platinum provisions which, upon closer inspection of the law and jurisprudence, belie Olympics and
Citinickels contentions.

In Celestial Nickel Mining Exploration Corporation v. Macroasia Corporation, et al., [36] this Court, speaking through Justice
Velasco, specified the kind of disputes that fall under Section 77(a) of the Mining Act:

The phrase disputes involving rights to mining areas refers to any adverse claim, protest, or opposition to an
application for a mineral agreement.

xxx xxx xxx

[T]he power of the POA to resolve any adverse claim, opposition, or protest relative to mining rights under Section 77 (a) of
RA 7942 is confined only to adverse claims, conflicts, and oppositionsrelating to applications for the grant of mineral
rights. xxx. Clearly, POAs jurisdiction over disputes involving rights to mining areas has nothing to do with the
cancellation of existingmineral agreements. [Emphasis supplied.]

In so ruling, the Court read Section 77 (a) in relation with Sections 38 and 41 of DENR Administrative Order No. 96-40
(Revised Implementing Rules and Regulations of the Mining Act or RIRR), which provide:

Sec. 38. x x x. Within thirty (30) calendar days from the last date of publication/posting/radio announcements, the
authorized officer(s) of the concerned office(s) shall issue a certification(s) that the publication/posting/radio
announcement have been complied with. Any adverse claim, protest or opposition shall be filed directly, within thirty
(30) calendar days from the last date of publication/posting/radio announcement, with the concerned Regional
Office or through any concerned PENRO or CENRO for filing in the concerned Regional Office for purposes of its resolution
by the Panel of Arbitrators pursuant to the provisions of this Act and these implementing rules and regulations. Upon
final resolution of any adverse claim, protest or opposition, the Panel of Arbitrators shall likewise issue a certification to
that effect within five (5) working days from the date of finality of resolution thereof. Where there is no adverse claim,
protest or opposition, the Panel of Arbitrators shall likewise issue a Certification to that effect within five working days
therefrom.

xxx xxx xxx

No Mineral Agreement shall be approved unless the requirements under this Section are fully complied with and
any adverse claim/protest/opposition is finally resolved by the Panel of Arbitrators.

Sec. 41. x x x Within fifteen (15) working days from the receipt of the Certification issued by the Panel of Arbitrators
as provided in Section 38 hereof, the concerned Regional Director shall initially evaluate the Mineral Agreement
applications in areas outside Mineral reservations. He/She shall thereafter endorse his/her findings to the Bureau for
further evaluation by the Director within fifteen (15) working days from receipt of forwarded documents. Thereafter, the
Director shall endorse the same to the secretary for consideration/approval within fifteen working days from receipt of
such endorsement.

In case of Mineral Agreement applications in areas with Mineral Reservations, within fifteen (15) working days
from receipt of the Certification issued by the Panel of Arbitrators as provided for in Section 38 hereof, the same shall
 be evaluated and endorsed by the Director to the Secretary for consideration/approval within fifteen days from receipt
of such endorsement. [Emphasis supplied.]

Sections 38 and 41 of the RIRR pertain to the procedure involved in approving mineral agreements. These provisions are
largely lifted from Sections 48 and 53 of PD 463 (or the Mining Resources Development Decree), except that instead of the POA, it
was the Director of Bureau of Mines (now Mines and Geosciences Bureau or MGB) who previously had the authority to rule on pre-
approval protests or adverse claims.

To properly fall within the POAs jurisdiction under Section 77 (a) of the Mining Law, the dispute must:
1. refer to an adverse claim, protest, or opposition to an application for a mineral agreement; and
2. be filed prior to the approval by the DENR Secretary of the mineral agreement.

Under these terms, Section 77 (a) established a cut-off period (i.e., before the approval of the mineral agreement) when the
POAs jurisdiction may be properly invoked, and this period had long lapsed insofar as the dispute between Citinickel and
Platinum is concerned, as Olympics mining lease contract and its Operating Agreement with Platinum had already been
approved by the Government. Accordingly, invocation of the POAs jurisdiction under Section 77(a) finds no application in this
case.

Neither will POA be vested with jurisdiction through Section 77(b), as the nature of the agreement between Olympic and
Platinum is not the mineral agreement contemplated under the law. The term mineral agreement has a specific definition
under the Mining Act, Section 3 (ab) thereof states:

Section 3. Definition of Terms. xxx

(ab) Mineral Agreement refers to a contract between the government and a contractor, involving mineral
production-sharing agreement, co-production agreement, or joint-venture agreement.
Quite obviously, the Operating Agreement is not a contract between the government and a contractor;[37] instead, it is a
purely civil contract between two private entities one of whom happens to be a party to a mineral agreement with the
government. While the enforcement of the terms of an operating agreement would necessarily relate to an existing and approved
mineral agreement (as may be inferred from Section 4 of DENR Memorandum Order No. 2003-08),[38] this however does not make
the two concepts the same, nor does it make an operating agreement a specie of the mineral agreements contemplated under the
Mining Act. Section 26 of the Mining Act[39]states that a mineral agreement may be in the form of a mineral production sharing
agreement, a co-production agreement or a joint-venture agreement, and does not include an operating agreement in the
enumeration. Apart from this, the Mining Act and the various administrative issuances treat these two separately by providing for
different requirements, rules, and procedures governing their application, approval, and cancellation. Thus, to contend that a
dispute involving operating agreements can be classified as a dispute involving mineral agreements or permits stretches the
definition of mineral agreement beyond the clear terms of the law.

Indeed, the adoption of a definite meaning for mineral agreement reveals the intent to remove from the DENR, through
the MGB, the jurisdiction over disputes involving civil contracts on mining rights. Presidential Decree No. 1281[40] enumerates
cases that fall under the Bureau of Mines jurisdiction:

Section 7. In addition to its regulatory and adjudicative functions over companies, partnerships or persons engaged
in mining exploration, 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) xxx

(c) cancellation and/or enforcement of mining contracts due to the refusal of the claimowner/operator to abide by
the terms and conditions thereof. [Emphasis supplied.]
 Although Section 77 (d) of the Mining Act[41] has transferred to the POA jurisdiction over disputes pending before the Bureau
of Mines and the DENR, Section 77 (b) did not adopt the wording of Section 7, paragraphs (a) and (c) of PD No. 1281 so as to
include all other forms of contracts public or private involving mining rights; Section 77 (b) in relation to Section 3 (ab) of the
Mining Act did not include a general catch-all phrase to cover other agreements involving mining rights similar to those in Section
7, paragraphs (a) and (c) of PD No. 1281. Instead, the Mining Act, through the above-quoted Sections 3 (ab) and 26, has limited
the jurisdiction of the POA, as successor of the adjudicatory functions of the Bureau of Mines, to mineral agreements between the
government and the private contractor. Otherwise stated, while disputes between parties to any mining contract (including
operating agreements) may previously fall within the Bureau of Mines jurisdiction under Section 7 (a) or (c) of PD No. 1281, it can
no longer be so placed now within the authority of the POA to settle under Section 77 (b) of the Mining Law because its jurisdiction
has been limited to the resolution of disputes involving publicmineral agreements.

Parenthetically, the permit referred to in Section 77(b) of the Mining Act pertains to exploration permit, quarry permit, and
other mining permits recognized in Chapters IV, VIII, and IX of the Mining Act. An operating agreement, not being among those
listed, cannot be considered as a mineral permit under Section 77 (b).

Since the Operating Agreement is not the mineral agreement contemplated by law, the contention that jurisdiction should be
with the POA under Section 77(b) of the Mining Act cannot be legally correct. In plainer terms, no jurisdiction vests in the POA
under the cited provision because the Operating Agreement is not the mineral agreement that Section 77(b) refers to.

Even an invocation of Section 77(c) of Mining Act (referring to disputes involving surface owners, occupants and claim-
holders/concessionaires) would not suffice to confer jurisdiction over the dispute to the POA. Surface-owners, occupants, and
concessionaires refer to owners or occupants of the real property affected by the mining activities conducted by the claim-
holders/concessionaires (entities which are holding mining rights granted by the government).[42] Neither Citinickel nor Platinum
falls under this classification.

Additionally, the Court notes that both Olympic and Citinickel have previously recognized the RTCs jurisdiction to decide
the dispute when they filed civil cases before the trial courts of Palawan [43] and Paraaque,[44] respectively, for the cancellation of the
Operating Agreement on account of Platinums alleged gross violations. By doing so, both Olympic and Citinickel acknowledged
the authority and jurisdiction of the trial court to resolve their dispute with Platinum. Not only did they acknowledge this
jurisdiction, they as well failed to appeal the decisions rendered by the trial courts in these cases. Thereby, they accepted the binding
effect of the trial court decision, and more importantly recognized the trial courts authority to rule on their dispute with Platinum
regarding the Operating Agreement. In other words, they are now estopped from claiming that the POA, rather than the trial
court, has the sole and exlcusive authority to resolve the issue of whether the Operating Agreement may be rescinded for
Platinums alleged violations.

Olympic also raises the issue of venue: since one of Platinums causes of action in Civil Case No. 4199 was specific
performance in Civil Case No. 4199, Olympic claims that Platinums action was actually a personal one that should have been filed
either in Olympics or in Platinums place of residence, i.e., in Manila or in Makati City, respectively, and not in Puerto Princessa,
Palawan.

This contention however is negated by the allegations made by Platinum in its complaint to quiet title, filed before the RTC of
Puerto Princesa, Palawan. To reiterate, according to Platinum, it had been peacefully exercising its rights under the Operating
Agreement since 2003. However, Olympic cast a cloud on its interest under the Operating Agreement through its various actions,
which gave the public the impression that the Operating Agreement had already been terminated, and jeopardized Platinums right to
possess and conduct mining operations in the subject mining areas. Thus, Platinum asked the court to remove this cloud on its rights
over the subject mining areas.

The controlling factor in determining venue for cases is the primary objective for which said cases are filed.[45] As we had
earlier stated, Platinums primary objective in filing the complaint is to protect its interest in the subject mining areas, although it
joined its claims of breach of contract, damages, and specific performance in the case. In any event, the Rules of Court allow
joinder of causes of action in the RTC, provided one of the causes of action (in this case, the cause of action for quieting of title or
interest in real property located in Palawan) falls within the jurisdiction of said court and venue lies therein. [46] In fine, there is
absolutely no reason to disturb the CAs findings that venue was properly laid in the Palawan court.

In light of these, the Court affirms the jurisdiction of the RTC of Puerto Princesa, Palawan, Branch 95, and accordingly
dismiss Olympics petition for review on certiorari in G.R. 178188.
 Our conclusion on the trial courts authority to rule on Civil Case No. 4199 necessarily invalidates the injunctive writ issued
by the CA in CA-G.R. SP No. 101544 against the continuance of the proceedings in Civil Case No. 4199. We thus grant Platinums
petition in G.R. No. 183527. Moreover, the Court agrees with Platinums contention that Polly Dy had no standing to assail the
injunctive writs issued as these were not directed against her; her petition for certiorari before the CA (CA-G.R. SP No. 101544)
should have been dismissed.

Injunctive Writ against Citinickel, as Successor-in-Interest of Olympic

In G.R. No. 180674, Citinickel mainly argues it cannot be bound by the injunctive writs issued in Civil Case No. 4199 as it was
not impleaded in the case, despite the fact that the Deed of Assignment was executed before Civil Case No. 4199 was instituted by
Platinum, thus making it an indispensable party. Citinickel further claims that the POA Resolution had already attained finality
when the CA dismissed Platinums petition for certiorari questioning the POA Resolution in its January 18, 2007 Resolution.

We disagree.

In this case, one fact resonates and remains unrebutted the transfer of Olympics rights to Citinickel was done
surreptitiously, via the Deed of Assignment dated June 9, 2006, without the knowledge or consent of Platinum. Thus, when
Platinum instituted Civil Case No. 4199 on June 14, 2006 five days after the execution of the Deed of Assignment Platinum was
not notified of the assignment or even of the earlier Memorandum of Agreement between Olympic and Rockworks, contrary to
the terms of Section 13 of the Operating Agreement which expressly requires any party transferring or assigning its rights under
the Operating Agreement to a third party to inform the original party of the transfer or assignment. Section 13 of the Operating
Agreement states:
 The rights and interests of either [Olympic] or [Platinum] in and under this Agreement are assignable and/or transferrable, in whole
or in part, to persons or entities qualified xxx provided that the rights of both of the parties under this Agreement are preserved and
maintained, unaffacted or unimpaired, and provided further that the assignee undertake to be bound by all the provisions of this
Agreement, provided furthermore that the assigning party shall duly notify in writing the other party of such proposed assignment
and/or transfer before the actual assignment and/or transfer is done. [Emphasis supplied.]

Even if Platinum knew of the assignment/transfer, it was not bound to include Citinickel in the complaint because the
assignment/transfer of a mineral agreement application would, by law, take effect only after the approval of the DENR Secretary or
his representative. Section 40 of DENR Administrative Order No. 96-40 (Implementing Rules and Regulations of the Mining Act),
which states:

Section 40. Transfer or Assignment of Mineral Agreement Application. - Transfer or assignment of Mineral
Agreement applications shall be allowed subject to the approval of the Director/concerned Regional Director taking into
account the national interest and public welfare: Provided, That such transfer or assignment shall be subject to eligibility
requirements and shall not be allowed in cases involving speculation. [Emphasis supplied.]

The provision is clear any transfer or assignment of a mineral agreement application is still subject to the approval of the
Director of the Mines and Geosciences Bureau or the Regional Director concerned. In determining whether to approve the
assignment or not, the Director or Regional Director has to consider the national interest, public welfare, as well as study the
eligibility of the party to whom said application is being transferred to. Any assignment of a mineral agreement is thus considered
provisional, pending final approval by the Director or Regional Director. Thus, although the Deed of Assignment between Olympic
and Citinickel was executed on June 9, 2006, the actual transfer of rights occurred only after the Regional Director of the MGB
Regional Office No. IV-B had given its approval to the assignment on September 6, 2006, or after Civil Case No. 4199 was filed
on June 14, 2006. Accordingly, Citinickel, being a mere successor-in-interest of Olympic, is bound by the questioned injunction
order. Even if we disregard the inclusion of Citinickel in the July 16, 2006 Order granting the application for a writ of preliminary
injunction, the result would be the same the injunction imposed on Olympic will similarly bind Citinickel.

Thus, we resolve to dismiss Citinickels petition for lack of merit.

Validity of the POA Resolution

Platinums Rule 65 petition praying for the annulment of the POA Resolution was dismissed by the CA in its Resolution
dated January 18, 2007 in CA-G.R. SP No. 97288,on the ground that Platinum failed to exhaust administrative remedies by
appealing the POA Resolution to the MAB, as provided under the Mining Act.

We disagree with the reasoning of the CA and resolve to overturn its January 18, 2007 Resolution.

The rule of exhaustion of administrative remedies admits of numerous exceptions, such as:
1) when there is a violation of due process;

2) when the issue involved is purely a legal question;

3) when the administrative action is patently illegal amounting to lack or excess of jurisdiction;

4) when there is estoppel on the part of the administrative agency concerned;

5) when there is irreparable injury;

6) when the respondent is a department secretary whose acts as an alter ego of the President bears the implied and
assumed approval of the latter;

7) when to require exhaustion of administrative remedies would be unreasonable;

8) when it would amount to a nullification of a claim;

9) when the subject matter is a private land in land case proceedings;

 10) when the rule does not provide a plain, speedy and adequate remedy; and

11) when there are circumstances indicating the urgency of judicial intervention.[47]

Platinums serious allegations amount to circumstances calling for urgent judicial intervention. More importantly, Platinums
allegations essentially attack POAs jurisdiction over Citinickels complaint for lack or excess of jurisdiction. The CA thus committed
a reversible error when it failed to recognize the POAs jurisdictional errors and instead, mistakenly placed its reliance on a
procedural technicality.

Going into the merits of G.R. No. 181141, the Court finds that the POA Resolution was issued in disregard of the injunctive
writs in Civil Case No. 4199. We have earlier ruled in G.R. No. 180674 that Citinickel, as successor-in-interest of Olympic, became
bound by the writ of injunction issued by the trial court, even though it was not formally impleaded as a party when Civil Case No.
4199 was instituted. The injunction prohibited the parties Citinickel included from performing any act that will tend to
impede, hamper, limit or adversely affect the full enjoyment by [Platinum] of its rights under the Operating Agreement xxx [and]
from performing any act which will disturb the status quo. When the POA issued the assailed Resolution rescinding the Operating
Agreement and cancelling Platinums SSMPs at the instance of Citinickel, it clearly went against the prohibition.

Not only was the POA Resolution issued in contravention of the injunctive writ, POA Case No. 2006-02-B (where the
Resolution was issued) was instituted in blatant violation of the rules of forum shopping. POA Case No. 2006-02-B was instituted
while Citinickels complaint for cancellation of the Operating Agreement was pending before the RTC of Paranaque (docketed as
Civil Case NO. 06-0185). And while there was yet no decisive ruling on the status and validity of the Operating Agreement in these
cases, Citnickel had prematurely instituted petitions to cancel Platinums SSMPs and ECCs before the PMRB (docketed as PMRB
Case No. 002-06) and EMB, respectively. Along the same line, Citinickel filed a mandamus petition before the RTC of Quezon City
(docketed as Civil Case No. Q-07-59855) to compel the DENR Secretary to confiscate and hold possession of the mineral ores of
Platinumstockpiled at the Palawan pier. Over and above these cases, Olympic had, prior to the assignment, already instituted
similar actions before the same courts and agencies actions Citinickel is similarly bound as the assignee/transferee of Olympic.

Both Olympic and Citinickel evidently trifled with the courts and abused its processes by improperly instituting several cases
before various judicial and quasi-judicial bodies, one case after another (some even simultaneously filed during the pendency of
other cases) once it became evident that a favorable decision will not be obtained in the previously filed case all of which are
focused on the termination of the Operating Agreement and the cancellation of Platinums mining permits. While a party may avail
himself of the remedies prescribed by law or by the Rules of Court, such party is not free to resort to them simultaneously or at his
pleasure or caprice.[48] The actions of Olympic and Citinickel, taken separately or collectively, betray a pattern of calculated
and intentional forum shopping that warrants denial of the reliefs they pray for.

In accordance with our finding in G.R. No. 180674 that Citinickel is bound by the injunctive writ issued by the trial court in
Civil Case No. 4199, as well as our observation in G.R. No. 178188 that the trial court, not POA, has jurisdiction over Platinums
complaint in Civil Case No. 4199, we can come to no other conclusion than to declare that the POA gravely abused its discretion
when it issued the POA Resolution dated October 30, 2006. Thus, we grant Platinums petition in G.R. No. 181141, and annul the
POA Resolution.

WHEREFORE, premises considered, we rule as follows:

a) in G.R. No. 178188 (Olympic Mines v. Platinum Group Metals Corporation): Olympics petition is denied for lack of merit
and the assailed CA Decision in CA-G.R. SP No. 97259 is AFFIRMED;

b) in G.R. No. 183527 (Platinum Group Metals Corporation v. Court of Appeals): The assailed CA Resolution in CA-G.R. SP
No. 101544 is REVERSED and SET ASIDE;
 c) in G.R. No. 180674 (Citinickel Mines and Development Corporation v. Judge Bienvenido Blancaflor and Platinum Group
Metals Corporation): The questioned CA Decision in CA-G.R. SP No. 99422 is AFFIRMED; and

d) in G.R. No. 181141 (Platinum Group Metals Corporation v. Citinickel Mines and Development Corporation): The CA
decision in CA-G.R. SP No. 97288 isREVERSED and SET ASIDE. The POEA Resolution, having been issued in violation of a
previously issued writ of preliminary injunction, is ANNULLED and SET ASIDE.

SO ORDERED.
G.R. No. 163509 December 6, 2006
PICOP RESOURCES, INC., petitioner,
vs.
BASE METALS MINERAL RESOURCES CORPORATION, and THE MINES ADJUDICATION BOARD,respondents.

DECISION

TINGA, J.:
PICOP Resources, Inc. (PICOP) assails the Decision1 of the Court of Appeals dated November 28, 2003 and its Resolution2 dated 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 IFMA3 or 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 7055 connotes 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.6
The 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 not ipso facto revoke, 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 Resolution7 dated 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 Memorandum8 dated 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),9 and overlaps the wilderness area where mining applications are expressly prohibited under RA 7586.10 Hence, the area is closed to mining operations
under Sec. 19(f) of RA 7942.11
PICOP 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 of PICOP Resources, Inc. v. Hon. Heherson T. Alvarez,12 wherein 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 activities underneath the area in dispute will surely undermine PICOP's
supply of raw materials on 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,13 Base 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 proceedings a quo may 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 Memorandum14 dated 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 of PICOP 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 of Apex Mining Corporation v. Garcia,15 to 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 Opposition16 dated 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.17
Base Metals met this argument head on in its Answer18 dated 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 Petition19 dated 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 7942 for the first time in 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-called new issues raised by PICOP are well within the issues framed by the parties in the proceedings a 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. 19 Areas 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,21 such 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 those proclaimed 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 in Apex 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.22 It 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.23
 III. 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.24
IV. 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.25
V. 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.26
Thirdly, 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 Philippines proclaimed, designated or set aside, pursuant to a law, presidential decree, presidential proclamation or
executive order as national 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 in Oposa v. Factoran27 that 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. In Tan 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 in Felipe 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 [See Sections 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.
PYRO COPPER MINING G.R. No. 179674
CORPORATION,
Petitioner,

Present:
 - versus -
YNARES-SANTIAGO, J.,
Chairperson,
MINES ADJUDICATION CHICO-NAZARIO,
BOARD-DEPARTMENT OF VELASCO, JR.,
ENVIRONMENT AND NACHURA, and
NATURAL RESOURCES, PERALTA, JJ.
MINES AND GEO-
SCIENCES BUREAU
DIRECTOR HORACIO C.
RAMOS, REGIONAL
DIRECTOR SAMUEL T.
PARAGAS, REGIONAL
PANEL OF ARBITRATORS
ATTY. CLARO E.
RAMOLETE, JR., ATTY.
JOSEPH ESTRELLA and
ENGR. RENATO RIMANDO,
and MONTAGUE Promulgated:
RESOURCES PHILIPPINES
CORPORATION,
Respondents. July 28, 2009
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x

DECISION

CHICO-NAZARIO, J.:

Before this Court is a Petition for Review on Certiorari, under Rule 45 of the 1997 Revised Rules of Civil Procedure, seeking
to reverse the Resolutions dated 23 February 2007[1] and 6 September 2007[2] of the Court of Appeals in CA-G.R. SP No.
97663. The appellate court, in its assailed Resolution dated 23 February 2007, dismissed the Petition for Review, under Rule 43 of
the 1997 Revised Rules of Civil Procedure, of herein petitioner Pyro Copper Mining Corporation, for failure of petitioner to attach
pertinent and relevant documents thereto.[3] The appellate court, in its other assailed Resolution dated 6 September 2007, denied the
Motion for Reconsideration of petitioner for lack of merit and for failure to show the authority of Atty. Vicente R. Acsay (Atty.
Acsay), one of the members of the Board of Directors of petitioner, to sign the Verification and Certification against Forum
Shopping accompanying the Petition.

Petitioner additionally prays for the setting aside or reversal of the Decision [4] dated 28 December 2006 of the Department of
Environment and Natural Resources (DENR)-Mines Adjudication Board (MAB) in MAB Case No. 0147-06, which affirmed the
Orders dated 14 September 2005[5] and 27 December 2005[6] of the DENR-Panel of Arbitrators, Region 1, San Fernando City, La
Union (Panel of Arbitrators), in Case No. 2005-00012-I, dismissing the Verified Protest/Opposition of petitioner to the Application
for Exploration Permit of private respondent Montague Resources Philippines Corporation. Ultimately, petitioner seeks the denial of
the mining claim and the revocation/cancellation of the Exploration Permit, EXPA No. 21 dated 12 September 2003, of private
respondent.

The factual antecedents of this case are as follows:

Petitioner is a corporation duly organized and existing under Philippine laws engaged in the business of mining. On 31 March
2000, petitioners Application for Mineral Production Sharing Agreement (MPSA), identified as APSA-SF-000089, with the Mines
and Geo-Sciences Bureau (MGB) of the DENR, Regional Office No. 1, San Fernando City in La Union, for the exploration,
development and commercial utilization of certain pyrite ore and other mineral deposits in a 4,360.71-hectare land in Dasol,
Pangasinan, was approved and MPSA No. 153-2000-1 was issued in its favor.

Private respondent is also a corporation organized and existing under the laws of the Philippines and engaged in the business
of mining. On 12 September 2003, private respondent filed an Application for Exploration Permit [7] with MGB covering the same
properties covered by and during the subsistence of APSA-SF-000089 and MPSA No. 153-2000-1[8] of petitioner. In turn, petitioner
filed a Verified Protest/Opposition to the Application for Exploration Permit of the private respondent. It was allegedly filed with
the Panel of Arbitrators[9] on 30 August 2005 and was received by the latter on 5 September 2005. The case was docketed as Case
No. 2005-00012-I.
 Prior, however, to petitioners filing of its Verified Protest/Opposition to the private respondents Application for Exploration
Permit, petitioners MPSA No. 153-2000-1 was cancelled per DENR Memorandum Order (DMO) No. 2005-03[10] issued by the
DENR Secretary Michael Defensor on 1 February 2005. Petitioner moved for the reconsideration of DMO No. 2005-03, which the
DENR Secretary denied in its Decision[11] dated 14 June 2005.[12]

On 1 September 2005,[13] the MGB issued EP No. 05-001 to private respondent.

In an Order dated 14 September 2005, the Panel of Arbitrators dismissed motu proprio the Verified Protest/Opposition of
petitioner for the following reasons: (1) the instant pleading was filed out of time; (2) in view of the issuance of EP No. 05-001 to
private respondent, the Verified Protest/Opposition of petitioner to the Application for Exploration Permit of private respondent was
rendered moot and academic; (3) the Panel of Arbitrators had no authority/jurisdiction to cancel, deny and/or revoke EP No. 05-001
of private respondent, the same being lodged with the MGB, the issuing authority; and (4) petitioner failed to include a certification
against forum shopping.[14] Petitioner moved for its reconsideration, but the Panel of Arbitrators denied the same in its Order
dated 27 December 2005.[15]

Petitioner elevated by appeal to the MAB the Orders dated 14 September 2005 and 27 December 2005 of the Panel of
Arbitrators, docketed as MAB Case No. 0147-06.

Subsequently, in a Decision[16] dated 28 December 2006 in MAB Case No. 0147-06, the MAB dismissed the appeal of
petitioner, on the following grounds: (a) the Verified Protest/Opposition of petitioner to the Application for Exploration Permit of
private respondent was filed beyond the reglementary period; and (b) the Verified Protest/Opposition of petitioner did not include a
certification against forum shopping.[17]

Petitioner filed with the Court of Appeals a Petition for Review under Rule 43 of the 1997 Revised Rules of Civil Procedure,
which was docketed as CA-G.R. SP No. 97663.

In a Resolution dated 23 February 2007, the Court of Appeals dismissed the said Petition, pursuant to Section 7, Rule 43, of
the 1997 Revised Rules of Civil Procedure,[18]for failure of petitioner to attach thereto some pertinent and relevant documents
required under Section 6 of the same Rule.[19]
 Petitioner filed a Motion for Reconsideration of the 23 February 2007 Resolution, together with the required
documents. Private respondent, however, in its Comment,[20]still prayed for the dismissal of the Petition in CA-G.R. SP No. 97663
for failure of petitioner to submit Atty. Acsays authority to sign the Verification and Certification against Forum Shopping.

Petitioner was given an opportunity to submit Atty. Acsays written authority, but failed to do so. Consequently, the Court of
Appeals issued a Resolution dated 6 September 2007, denying for lack of merit the Petition in CA-G.R. SP No. 97663.

Hence, this Petition.

The petitioner raises the following issues for this Courts Resolution:

I. WHETHER OR NOT THE [COURT OF APPEALS] DEPARTED FROM THE RULES AND ESTABLISHED
JURISPRUDENCE WHEN IT DISMISSED THE PETITION [A QUO]DESPITE FAITHFUL COMPLIANCE
WITH THE RULES ON DISCLOSURE AS INCORPORATED IN THE VERIFICATION AND CERTIFICATION
PORTION OF THE MOTION FOR EXTENSION [OF] TIME AND PETITION A QUO.

II. WHETHER OR NOT THE [COURT OF APPEALS] DEPARTED FROM THE RULES AND ESTABLISHED
JURISPRUDENCE WHEN IT DISMISSED THE PETITION A QUODESPITE THE ATTACHMENT AND
SUBMISSION OF THE REQUISITE AUTHORITY TO MAKE AND SIGN VERIFICATIONS AND
SUBSEQUENTLY REQUIRED PLEADINGS.

III. WHETHER OR NOT THE [COURT OF APPEALS] REFUSED TO ADJUDICATE THE PETITION A
QUO DESPITE THE ATTENDANCE OF A CLEARLY EXCEPTIONAL CHARACTER
AND PARAMOUNT PUBLIC INTEREST INVOLVED AS WELL AS THE NECESSITY FOR A RULING TO
PUT AN END TO UNSCRUPULOUS ISSUANCE OF MINING CLAIMS.

IV. WHETHER OR NOT PUBLIC RESPONDENTS IN THE DENR COMMITTED SERIOUS ERROR AND
GRAVE ABUSE OF DISCRETION IN DECLARING THAT: (A) THE VERIFIED PROTEST/OPPOSITION WAS
FILED OUT OF TIME; (B) THE ISSUANCE OF THE EXPLORATION PERMIT IN FAVOR OF [PRIVATE
RESPONDENT] ON [1 SEPTEMBER 2005] AND THE UNILATERAL CANCELLATION OF THE MPSA BY
THE DENR-SECRETARY RENDERED THE VERIFIED PROTEST/OPPOSITION MOOT AND ACADEMIC;
(C) THE [PANEL OF ARBITRATORS] HAVE NO JURISDICTION TO CANCEL, DENY AND/OR REVOKE
 THE EXPLORATION PERMIT OF [PRIVATE RESPONDENT]; AND (D) THE VERIFIED
PROTEST/OPPOSITION DOES NOT CONTAIN A CERTIFICATION AGAINST FORUM SHOPPING.[21]

To resolve the foregoing issues, the Court must address the more specific issues below:

I. Whether the subsequently attached Minutes of the Special Meeting dated 22 January 2007 of the Board of Directors
of petitioner sufficiently granted Atty. Acsay authority to sign the Verification and Certification against Forum
Shopping which accompanied the Petition in CA-G.R. SP No. 97663.

II. Whether the Verified Protest/Opposition of petitioner to the Application for Exploration Permit of private
respondent was filed out of time.

III. Whether the Verified Protest/Opposition of petitioner filed before the MAB needs to be accompanied by a
Certification against Forum Shopping.

IV. Whether the issuance by the DENR Secretary of DMO No. 2005-03 on 1 February 2005 which cancelled MPSA
No. 153-2000-1 of petitioner and the issuance by MGB of EP No. 05-001 in favor of private respondent on 1
September 2005 rendered the Verified Protest/Opposition of petitioner moot and academic.

V. Whether the Panel of Arbitrators has jurisdiction to cancel, deny and/or revoke EP No. 05-001 issued by MGB to
private respondent.

The Court finds no merit in the present Petition.

Petitioner maintains that there are special circumstances and basic considerations in support of Atty. Acsays authority to
execute and sign the Verification and Certification against Forum Shopping which accompanied its Petition in CA-G.R. SP No.
97663. Firstly, Atty. Acsay is an incorporator, stockholder, member of the board of directors, corporate secretary, and legal counsel
of petitioner. Secondly, he was the authorized representative of petitioner in the signing of MPSA No. 153-2000-1. Therefore, Atty.
Acsay is the best legally suitable person to make the required sworn disclosures in the Verification and Certification against Forum
Shopping in the Petition of petitioner in CA-G.R. SP No. 97663.

Petitioner also contends that the Minutes of the Meeting held on 22 January 2007 by the board of directors of petitioner,
bestowing upon Atty. Acsay the authority to make and sign the Verification for the Motion for Extension of Time to File Petition for
Review under Rule 43 of the 1997 Revised Rules of Civil Procedure, must be construed in its entirety. According to the Minutes,
Atty. Acsay was granted authority by the board to sign even verifications, which may be required in subsequent pleadings filed by
petitioner. The reference in the Minutes to the Motion for Extension of Time to File Petition for Review is not meant to be restrictive
or qualifying, as to exclude other pleadings.

With the foregoing, petitioner firmly argues that it has substantially complied with the requirements for the execution of the
Verification and Certification against Forum Shopping, which accompanied its Petition in CA-G.R. SP No. 97663.

Section 6(d), Rule 43[22] in relation to Section 2, Rule 42[23] of the 1997 Revised Rules of Civil Procedure mandates that a
petition for review shall contain a sworn certification against forum shopping, in which the petitioner shall attest that he has not
commenced any other action involving the same issues in this Court, the Court of Appeals or different divisions thereof, or any other
tribunal or agency; if there is such other action or proceeding, he must state the status of the same; and if he should thereafter learn
that a similar action or proceeding has been filed or is pending before this Court, the Court of Appeals, or different divisions thereof,
or any other tribunal or agency, he undertakes to promptly inform the aforesaid courts and other tribunal or agency thereof within
five days therefrom.[24]

For failure to comply with this mandate, Section 7, Rule 43 of the 1997 Revised Rules of Civil Procedure provides:

SEC. 7. Effect of failure to comply with requirements. The failure of the petitioner to comply with any of the
foregoing requirements regarding the payment of the docket and other lawful fees, the deposit for costs, proof of service of
the petition, and the contents of and the documents which should accompany the petition shall be sufficient ground for
the dismissal thereof.
 The requirement that petitioner should sign the Certification against Forum Shopping applies even to corporations, the Rules
of Court making no distinction between natural and juridical persons.[25] A corporation, however, exercises its powers through its
board of directors and/or its duly authorized officers and agents. Physical acts, like the signing of documents, can be performed only
by natural persons duly authorized for the purpose by corporate by-laws or by a specific act of the board of directors.[26] The
signatory, therefore, in the case of the corporation should be a duly authorized director or officer of the corporation who has
knowledge of the matter being certified.[27]

If the petitioner is a corporation, a board resolution authorizing a corporate officer to execute the Certification against Forum
Shopping is necessary. A certification not signed by a duly authorized person renders the petition subject to dismissal.[28]

To recall, the Court of Appeals initially dismissed, in its Resolution dated 23 February 2007, the Petition for Review in CA-
G.R. SP No. 97663, for failure of petitioner to submit pertinent and relevant documents required under Section 6, Rule 43 of the
1997 Revised Rules of Civil Procedure. The petitioner filed a Motion for Reconsideration, attaching thereto the required documents,
except the proof of Atty. Acsays authority to sign the Verification and Certification against Forum Shopping for the
Petition. Instead of immediately dismissing the Motion for Reconsideration of petitioner, however, the Court of Appeals, in its
Resolution dated 8 June 2007, gave petitioner five days from receipt thereof to submit such proof. The petitioner then submitted the
Minutes of the Special Meeting held on 22 January 2007 by its board of directors, adopting a Resolution to the following effect:

RESOLVED, that [Atty. Acsay], Director and Corporate Secretary of [herein petitioner] be, as he hereby is,
authorized to make and sign the verification of the pleading filed by [petitioner] entitled Motion for Extension of Time to
File Petition for Review under Rule 43 of the Rules of Court.[29]

It can be gleaned from the afore-quoted Resolution of the board of directors of petitioner that the authority granted to Atty.
Acsay was to make and sign the pleading entitled Motion for Extension of Time to File Petition for Review under Rule 43 of the
Rules of Court, but not the Petition for Review itself. The wordings of the board Resolution are so explicit that they cannot be
interpreted otherwise. There is nothing to justify the argument of petitioner that the authority to sign granted to Atty. Acsay by the
said board Resolution extended to all other pleadings subsequent to the Motion for Extension.
 Other than the Minutes of the Special Meeting held on 22 January 2007 by the board of directors of petitioner, which the
Court deemed unsatisfactory, no other proof of Atty. Acsays purported authority to sign the Verification and Certification against
Forum Shopping for the Petition for Review in CA-G.R. SP No. 97663 was presented. Absent proof of such authority, then the
reasonable conclusion is that there is actually none. Given that a certification not signed by a duly authorized person renders the
petition subject to dismissal,[30] the Court of Appeals did not err in finally dismissing in its Resolution dated 6 September 2007 the
Petition of petitioner in CA-G.R. SP No. 97663.

Although the Court has previously relaxed the rules on verification and certification against forum shopping in some
instances,[31] it cannot do so here.

From the very beginning, petitioner failed to attach to its Petition for Review before the Court of Appeals the relevant
documents required by Section 6, Rule 43 of the 1997 Revised Rules of Procedure. Petitioner had two opportunities to comply with
the requisites, i.e., when it filed its Motion for Reconsideration of the 23 February 2007 Resolution of the Court of Appeals and
when it submitted its compliance with the 8 June 2007 Resolution of the appellate court; yet, petitioner still failed to do
so. Petitioner never offered any satisfactory explanation for its stubborn non-compliance with or disregard for the rules of
procedure.

It is true that a litigation is not a game of technicalities, and that the rules of procedure should not be strictly enforced at the
cost of substantial justice. However, it does not mean that the Rules of Court may be ignored at will and at random, to the prejudice
of the orderly presentation and assessment of the issues and their just resolution. It must be emphasized that procedural rules should
not be belittled or dismissed simply because their non-observance may have resulted in prejudice to a partys substantial rights. Like
all rules, they are required to be followed except only for the most persuasive of reasons.[32]

II

Even assuming arguendo that Atty. Acsay did have the authority to sign the Verification and Certification against Forum
Shopping for the Petition for Review of petitioner in CA-G.R. SP No. 97663, and the Court of Appeals erred in dismissing said
Petition, the Court still cannot grant the prayer of petitioner herein to reverse the actions undertaken by the DENR as regards the
cancellation of its MPSA No. 153-2000-1 and the issuance of EP No. 05-001 to private respondent.
 Petitioner insists that it filed its Verified Protest/Opposition to the Application for Exploration Permit of private respondent
within the reglementary period. Based on the records of MGB, the Notice of Application for Exploration Permit of private
respondent was actually posted from 14 July 2005 to 28 July 2005. Applying the 30-day reglementary period, the last date on which
to file any adverse claim, protest or opposition to the said application was 27 August 2005, a Saturday. Since 29 August 2005,
Monday, was declared a national holiday, the next business day was 30 August 2005, Tuesday. This very well explains why the
Verified Protest/Opposition of petitioner was filed on 30 August 2005. Petitioner further avows that it paid the required legal fees
through postal money order. The issuance of the official receipt only after the filing, through registered mail, of its Verified
Protest/Opposition, does not erase the fact that the docket fees were paid to and received by the government.

Section 21 of DAO No. 96-40 mandates:

Section 21. Publication/Posting/Radio Announcement of an Exploration Permit Application. - x x x Any adverse

claim, protest or opposition shall be filed directly, within thirty (30) calendar days from the last date of
publication/posting/radio announcement, with the concerned Regional Office or through any concerned PENRO or CENRO
for filing in the concerned Regional Office for purposes of its resolution by the Panel of Arbitrators pursuant to the
provisions of the Act and these implementing rules and regulations. x x x.

Considering that the Rules on Pleadings, Practice and Procedure before the Panel of Arbitrators and MAB are bereft of any
provision regarding the computation of time and the manner of filing, the Court may refer to Section 1, Rule 22 and Section 3, Rule
13 of the 1997 Revised Rules of Civil Procedure,[33] which state:

Section 1. How to compute time. In computing any period of time prescribed or allowed by these Rules, or by order
of the court, or by any applicable statute, the day of the act or event from which the designated period of time begins to run
is to be excluded and the date of performance included. If the last day of the period, as thus computed, falls on a
Saturday, a Sunday, or a legal holiday in the place where the court sits, the time shall not run until the next working
day. (Emphasis supplied.)

Section 3. Manner of filing. - The filing of pleadings, appearances, motions, notices, orders, judgments and all other
papers shall be made by presenting the original copies thereof, plainly indicated as such, personally to the clerk of court or
by sending them by registered mail. In the first case, the clerk of court shall endorse on the pleading the date and hour of
 filing. In the second case, the date of the mailing of motions, pleadings, or any other papers or payments or deposits,
as shown by the post office stamp on the envelope or the registry receipt, shall be considered as the date of their
filing, payment or deposit in court. The envelope shall be attached to the record of the case. (Emphasis supplied.)

In the present case, notices of the Application for Exploration Permit of private respondent were published in
newspapers,[34] announced on the radio,[35] and posted in public places. The posting was done the latest, so we reckon the last
possible date petitioner could have validly filed its Verified Petition/Opposition with the Panel of Arbitrators therefrom.

The notices of the Application for Exploration Permit of private respondent were posted on the bulletin boards of the Office of
the Municipal Mayor of Dasol, Pangasinan on 16 to 31 March 2005; Office of the Municipal Mayor of Mabini, Pangasinan on 16 to
31 March 2005; Office of the Pangasinan Provincial Environment and Natural Resources on 17 March 2005 to 2 April 2005; Office
of the DENR Provincial Environment and Natural Resources-Pangasinan on 15 March 2005 to 6 April 2005; Office of the DENR
Community Environment and Natural Resources-Alaminos City on 17 March 2005 to 5 April 2005; Offices of the Punong
Barangays of Malimpin, San Pedro, Barlo, San Vicente, and Alilao on 16 to 31 March 2005; and MGB on 14 to 28 July 2005. [36]

Since the notice of the Application for Exploration Permit of private respondent was last posted on 28 July 2005, the 30-day
reglementary period for filing any adverse claim/protest/opposition thereto ended on 27 August 2005. As petitioner explained,
however, 27 August 2005 was a Saturday; and 29 August 2005, Monday, was declared a national holiday,[37] so the next working
day was 30 August 2005, Tuesday. Petitioner did send its Verified Protest/Opposition, through registered mail, on 30 August 2005,
as evidenced by the Affidavit of Service[38] of even date and Registry Receipts No. 10181; No. 10182; No. 10183; and No.
10184.[39] Nevertheless, the Court still could not consider the Verified Protest/Opposition of petitioner as having been filed within
the reglementary period.

Section 21 of DAO No. 96-40, fixing the 30-day reglementary period for filing any adverse claim/protest/opposition to an
application for exploration permit, must be read in relation to Section 204 of DAO No. 96-40, which reads:

Section 204. Substantial Requirements for Adverse Claims, Protest and Oppositions. No adverse claim, protest or
opposition involving mining rights shall be accepted for filing unless verified and accompanied by the prescribed docket
fee and proof of services to the respondent(s), either personally or by registered mail: Provided, That the requirement
for the payment of docket fees shall not be imposed on pauper litigants[;] (Emphasis supplied.)
and Section 7, Rule III of the Rules on Pleadings, Practice and Procedure before the Panel of Arbitrators and MAB, which states
that:

Section 7. Form and Contents of Adverse Claims, Protest or Opposition. No adverse claim, petition, protest or
opposition involving mining rights shall be accepted for filing unless verified and accompanied by the prescribed docket
fee and proof of services to the respondent(s), either personally or by registered mail: Provided, That the requirement
for the payment of docket fees shall not be imposed on pauper litigants. (Emphasis supplied.)

Section 204 of DAO No. 96-40 and Section 7, Rule III of the Rules on Pleadings, Practice and Procedure before the Panel of
Arbitrators and MAB explicitly require that the adverse claim/protest/opposition be accompanied by the payment of the prescribed
docket fee for the same to be accepted for filing.

Upon a careful examination of the records of this case, it appears that the docket fee was paid only on 6 September 2005, as
evidenced by Official Receipt (O.R.) No. 7478283 B.[40] Although petitioner avers that it paid the docket fee through postal money
order in which case, the date of mailing would be deemed the date of payment such averment is unsubstantiated. The Court finds
no evidence to prove that petitioner actually sent the purported postal money order for the payment of the docket fee. Petitioner
submits the following evidence to prove payment of the docket fee: (a) a Prudential Bank Check in the amount of P5,020.00 dated 1
September 2005;[41] (b) O.R. No. 7478283 B dated 6 September 2005 issued by MGB Region I, San Fernando City; and (c) several
registry return receipts.[42] But these pieces of evidence do not establish at all that the docket fee was paid by postal money order; or
indicate the postal money order number and the date said postal money order was sent. Without any evidence to prove otherwise,
the Court presumes that the docket fee was paid on the date the receipt for the same was issued, i.e., 6 September 2005.

Based on the foregoing, the Verified Protest/Opposition of petitioner to the Application for Exploration Permit of respondent
is deemed filed with the Panel of Arbitrators only upon payment of the prescribed docket fee on 6 September 2005, clearly beyond
the reglementary period, which ended on 30 August 2005.

III
 The Panel of Arbitrators denied the Verified Protest/Opposition of petitioner in Case No. 2005-00012-I for another procedural
lapse, the lack of a certification against forum shopping.

Petitioner argues that a Verified Protest/Opposition does not require a certification against forum shopping. According to it,
Section 204 of DAO No. 96-40 identifies the substantial requirements of a mining adverse claim/ protest/opposition, and a
certification against forum shopping is not among them; the Panel of Arbitrators has no power and authority to impose additional
requirements for the filing and service of pleadings; the Panel of Arbitrators also does not have the authority to promulgate rules and
regulations involving the practice, pleadings, litigation and disposition of cases before it, for the same only belongs to the MAB,
pursuant to Section 207 of DAO No. 96-40.

The arguments of petitioner have no merit.

Petitioner filed a Verified Protest/Opposition before the Panel of Arbitrators to oppose the Application for Exploration Permit
filed by private respondent with the MGB. The Verified Protest/Opposition of petitioner constitutes an initiatory pleading before the
Panel of Arbitrators, for which a certification against forum shopping may be required. Truly, DAO No. 96-40 is bereft of any
provision requiring that a certification against forum shopping be attached to the adverse claim/protest/opposition. However,
Section 4, Rule 1 of the Rules on Pleading, Practice and Procedure before the Panel of Arbitrators and the MAB allows the
application of the pertinent provisions of the Rules of Court by analogy or in a suppletory manner, in the interest of expeditious
justice and whenever practical and convenient; and, according to Section 5, Rule 7 of the Revised Rules of Court:

SEC. 5. Certification against forum shopping. The plaintiff or principal party shall certify under oath in
the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and
simultaneously filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving the same
issues in any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other action or claim is
pending therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c)
if he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that fact
within five (5) days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed.

Failure to comply with the foregoing requirements shall not be curable by mere amendment of the complaint or other
initiatory pleading but shall be cause for the dismissal of the case without prejudice, unless otherwise provided, upon
 motion and after hearing. The submission of a false certification or non-compliance with any of the undertakings therein
shall constitute indirect contempt of court, without prejudice to the corresponding administrative and criminal actions. If the
acts of the party or his counsel clearly constitute willful and deliberate forum shopping, the same shall be ground for
summary dismissal with prejudice and shall constitute direct contempt, as well as a cause for administrative sanctions.

Hence, the requirement by the Panel of Arbitrators and the MAB that a certification against forum shopping be attached to
initiatory pleadings filed before them, to ascertain that no similar actions have been filed before other courts, tribunals, or quasi-
judicial bodies, is not arbitrary or baseless. The lack of such a certification is a ground for the dismissal of the Verified
Protest/Opposition of petitioner.

IV

The Panel of Arbitrators dismissed the Verified Protest/Opposition of petitioner for a third reason: that the same has become
moot and academic, given that the DENR Secretary already issued DMO No. 2005-03 on 1 February 2005 canceling MPSA No.
153-2000-1 and MGB issued EP No. 05-001 to private respondent on 1 September 2005.

However, petitioner asserts that MPSA No. 153-2000-1 has not been finally cancelled or revoked, considering the pendency
of the legal remedies it availed itself of for DMO No. 2005-03. The issuance of DMO No. 2005-03 by the DENR Secretary, and of
EP No. 05-001 by MGB pursuant thereto, should not render the Verified Protest/Opposition of petitioner moot and academic.

The position of petitioner is untenable.

It must be stressed that the cancellation of MPSA No. 153-2000-1 of petitioner by the DENR Secretary in DMO No. 2005-03
is already the subject of separate proceedings. The Court cannot touch upon it in the Petition at bar.

Also worth stressing is that petitioner filed a Verified Protest/Opposition to the Application for Exploration Permit of
private respondent. When the application was approved and the exploration permit issued to private respondent, petitioner had
nothing more to protest/oppose. More importantly, with the issuance by MGB of EP No. 05-001 to private respondent, the remedy
of petitioner is to seek the cancellation thereof, over which, as subsequently discussed herein, the Panel of Arbitrators would have no
jurisdiction. The Panel of Arbitrators cannot simply consider or convert the Verified Protest/Opposition of petitioner to the
Application for Exploration Permit of private respondent as a petition for the cancellation of EP No. 05-001. Since the Panel of
Arbitrators can no longer grant petitioner any actual substantial relief by reason of the foregoing circumstances, then the Verified
Protest/Opposition of petitioner was appropriately dismissed for being moot and academic.

Finally, petitioner posits that Section 77 of Republic Act No. 7942 and Sections 202 to 203 of its Implementing Rules vest the
Panel of Arbitrators with the jurisdiction to entertain and accept any claim, protest or opposition filed directly with its office. In the
discharge thereof, the office and function bestowed upon the Panel of Arbitrators include the power and authority to deny clearances,
exclude exploration permits, and not to accept or entertain the same.

The Court disagrees.

Section 77 of Republic Act No. 7942 establishes the jurisdiction of the Panel of Arbitrators, thus:

Sec. 77. Panel of Arbitrators. x x x. Within thirty (30) working days, after the submission of the case by the parties
for decision, the panel shall have exclusive and original jurisdiction to hear and decide on the following:

a. Disputes involving rights to mining areas;

b. Disputes involving mineral agreements or permits;

c. Disputes involving surface owners, occupants and claimholders/concessionaires; and

d. Disputes pending before the Bureau and the Department at the date of the effectivity of this Act. (Emphasis
supplied.)
 In Olympic Mines and Development Corporation v. Platinum Group Metals Corporation [43] citing Celestial Nickel Mining
Exploration Corporation v. Macroasia Corporation,[44] this Court made the following pronouncements as regards paragraphs (a) and
(b) of Section 77 of Republic Act No. 7942:

In Celestial Nickel Mining Exploration Corporation v. Macroasia Corporation, et al., this Court speaking through
Justice Velasco, specified the kind of disputes that fall under Section 77(a) of the Mining Act:

The phrase disputes involving rights to mining areas refers to any adverse claim, protest, or
opposition to an application for a mineral agreement.

xxxx

[T]he power of the POA to resolve any adverse claim, opposition, or protest relative to mining
rights under Section 77 (a) of RA 7942 is confined only to adverse claims, conflicts, and
oppositions relating to applications for the grant of mineral rights. x x x. Clearly, POAs jurisdiction over
disputes involving rights to mining areas has nothing to do with the cancellation of existing mineral
agreements. (Emphases supplied.)

xxxx

Parenthetically, the permit referred to in Section 77(b) of the Mining Act pertains to exploration permit,
quarry permit, and other mining permits recognized in Chapters IV, VIII, and IX of the Mining Act. An operating
agreement, not being among those listed, cannot be considered as a mineral permit under Section 77
(b). (Emphases supplied.)

It is clear from the ruling of the Court in Olympic Mines and Celestial Nickel Mining that the Panel of Arbitrators only
has jurisdiction over adverse claims, conflicts, and oppositions relating to applications for the grant of mineral rights, but not
over cancellation of mineral rights already granted and existing.

As to who has jurisdiction to cancel an existing exploration permit, Section 28 of DAO NO. 96-40 explicitly provides:
 Section 28. Cancellation of an Exploration Permit. The Director/concerned Regional Director may cancel the
Exploration Permit for failure of the Permittee to comply with any of the requirements and for violation(s) of the terms and
conditions under which the Permit is issued. For renewed Exploration Permits, the Secretary upon the recommendation of the
Director shall cause the cancellation of the same.

According to Section 5 of DAO No. 96-40, Director means the Director of the MGB Central Office, while Regional
Director means the Regional Director of any MGB Regional Office. As the authority to issue an Exploration Permit is vested in the
MGB, then the same necessarily includes the corollary power to revoke, withdraw or cancel the same.[45] Indisputably, the authority
to deny, revoke, or cancel EP No. 05-001 of private respondent is already lodged with the MGB, and not with the Panel of
Arbitrators.

WHEREFORE, premises considered, the instant Petition for Review on Certiorari of petitioner Pyro Copper Mining
Corporation is hereby DENIED. The Resolutions dated 23 February 2007 and 6 September 2007 of the Court of Appeals in CA-
G.R. SP No. 97663 are hereby AFFIRMED. Costs against the petitioner.

SO ORDERED.
G.R. No. L-49109 December 1, 1987
SANTA ROSA MINING COMPANY, INC., petitioner,
vs.
HON. MINISTER OF NATURAL RESOURCES JOSE J. LEIDO, JR. AND DIRECTOR OF MINES JUANITO C. FERNANDEZ, respondents.

PADILLA, J.:
This is a special civil action for certiorari and prohibition with prayer for a writ of preliminary injunction, to declare Presidential Decree No. 1214 unconstitutional
and to enjoin respondent public officials from enforcing it. On 19 October 1978, the Court required the respondents to comment on the petition and issued a
temporary restraining order continuing until otherwise ordered by the Court.
Petitioner Santa Rosa Mining Company, Inc. (petitioner, for short) is a mining corporation duly organized and existing under the laws of the Philippines. It alleges
that it is the holder of fifty (50) valid mining claims situated in Jose Panganiban, Camarines Norte, acquired under the provisions of the Act of the U.S. Congress
dated 1 July 1902 (Philippine Bill of 1902, for short).
On 14 October 1977, Presidential Decree No. 1214 was issued, requiring holders of subsisting and valid patentable mining claims located under the provisions
of the Philippine Bill of 1902 to file a mining lease application within one (1) year from the approval of the Decree. Petitioner accordingly filed a mining lease
application, but "under protest," on 13 October 1978, with a reservation annotated on the back of its application that it is not waiving its rights over its mining
claims until the validity of Presidential Decree No. 1214 shall have been passed upon by this Court. 1
On 10 October 1978, or three (3) days before filing the disputed mining lease application, petitioner filed this special civil action for certiorari and prohibition,
alleging that it has no other plain, speedy and adequate remedy in the ordinary course of law to protect its rights (except by said petition). Petitioner assails
Presidential Decree No. 1214 as unconstitutional in that it amounts to a deprivation of property without due process of law.
Petitioner avers that its fifty (50) mining claims had already been declared as its own private and exclusive property in final judgments rendered by the Court of
First Instance of Camarines Norte (CFI, for short) in land registration proceedings initiated by third persons, such as, a September 1951 land title application by a
certain Gervacio Liwanag, where the Director of Mines opposed the grant of said application because herein petitioner, according to him (Director of Mines), had
already located and perfected its mining claims over the area applied for. Petitioner also cites LRC Case No. 240, filed 11 July 1960, by one Antonio Astudillo
and decided in 1974 against said applicant, in which, petitioner's mining claims were described as vested property outside the jurisdiction of the Director of
Mines. 2
In answer, the respondents allege that petitioner has no standing to file the instant petition as it failed to fully exhaust administrative remedies. They cite the
pendency of petitioner's appeal, with the Office of the President, of the ruling of the respondent Secretary of Natural Resources issued on 2 April 1977 in DNR
Case No. 4140, which upheld the decision of the Director of Mines finding that forty four (44) out of petitioner's fifty (50) mining claims were void for lack of valid
"tie points" as required under the Philippine Bill of 1902, and that all the mining claims had already been abandoned and cancelled, for petitioner's non-
compliance with the legal requirements of the same Phil. Bill of 1902 and Executive Order No. 141. 3
We agree with respondents' contention that it is premature for the Court to now make a finding on the matter of whether petitioner had abandoned its mining
claims. Until petitioner's appeal shall have been decided by the Office of the President, where it is pending, petitioner's attempt to seek judicial recognition of the
continuing validity of its mining claims, cannot be entertained by the Court. As stated by the Court, through Mr. Justice Sabino Padilla inHam v. Bachrach Motor
Co., Inc. 4 applying the principle of exhaustion of administrative remedies: "By its own act of appealing from the decision of the Director of Lands and the Secretary of
Agriculture and Natural Resources to the President of the Philippines, and without waiting for the latter's decision, the defendant cannot complain if the courts do not
take action be fore the President has decided its appeal." 5
The decisions of the Court of First Instance of Camarines Norte in applications for land registration filed by third persons covering the area over which petitioner
had located and registered its mining claims, as cited by petitioner, are inapplicable. Said decisions merely denied the applications of such third persons for land
registration over areas already covered by petitioner's mining claims, for failure to show titles that were registrable under the Torrens system; that was all. While
the CFI made a statement in one case declaring that the petitioner's mining claims are its vested property and even patentable at that time, there is nothing in
said CFI decision that squarely passed upon the question of whether petitioner had valid, patentable (but still unpatented) mining claims which it had continued
to maintain, in compliance with the requirements of applicable laws. This question, which involves a finding of facts, is precisely the issue before the Office of the
President in the petitioner's appeal from the decision of the Secretary of Natural Resources in DNR Case No. 4140 holding that petitioner's mining claims are
considered abandoned cancelled for failure of petitioner to comply with the requirements of the Philippine Bill of 1902 and Executive Order No. 141. In short, the
decisions of the Court of First Instance of Camarines Norte, relied upon by petitioner, do not foreclose a proceeding, such as DNR Case No. 4140, to determine
whether petitioner's unpatented mining claims have remained valid and subsisting.
Respondents further contend that, even assuming arguendo that petitioner's mining claims were valid at the outset, if they are deemed abandoned and
cancelled due to non-compliance with the legal requirements for maintaining a perfected mining claim, under the provisions of the Philippine Bill of
1902, 6 petitioner has no valid and subsisting claim which could be lost through the implementation of Presidential Decree No. 1214, thus giving it no standing to
question the Decree.
Petitioner, on the other hand, would rebut respondents' argument by declaring that it already had a vested right over its mining claims even before Presidential
Decree No. 1214, following the rulings in McDaniel v. Apacible 7and Gold Creek Mining Corp. v. Rodriguez. 8
The Court is not impressed that this is so.
The cases cited by petitioner, true enough, recognize the right of a locator of a mining claim as a property right. This right, however, is not absolute. It is merely a
possessory right, more so, in this case, where petitioner's claims are still unpatented. They can be lost through abandonment or forfeiture or they may be
revoked for valid legal grounds. The statement in McDaniel v. Apacible that "There is no pretense in the present case that the petitioner has not complied with all
the requirements of the law in making the location of the mineral claims in question, or that the claims in question were ever abandoned or forfeited by
him," 9 confirms that a valid mining claim may still be lost through abandonment or forfeiture.
The petitioner can not successfully plead the ruling in Gold Creek Mining Corp. v. Rodriguez, supra. In that case, what was in issue was Gold Creek's right to a
patent over its mining claim, after compliance with all legal requirements for a patent. In the present case, no application for patent is in issue, although as a
holder ofpatentable mining claims petitioner could have applied for one during all these years but inexplicably did not do so. In Gold Creek, no finding of
abandonment was ever made against the mining claimant as to deprive it of the initial privilege given by virtue of its location; on the other hand, such a finding
has been made in petitioner's case (although the finding among others is on appeal with the President).
We now come to the question of whether or not Presidential Decree No. 1214 is constitutional. Even assumingarguendo that petitioner was not bound to exhaust
administrative remedies on the question of whether or not its mining claims are still subsisting (not abandoned or cancelled before challenging the
constitutionality of said Decree, we hold that Presidential Decree No. 1214 is not unconstitutional. 10 It is a valid exercise of the sovereign power of the State, as owner, over lands of the
public domain, of which petitioner's mining claims still form a part, and over the patrimony of the nation, of which mineral deposits are a valuable asset. It may be underscored, in this connection, that the Decree does not cover
all mining claims located under the Phil. Bill of 1902, but only those claims over which their locators had failed to obtain a patent. And even then, such locators may still avail of the renewabletwenty-five year (25) lease
prescribed by Pres. Decree No. 463, the Mineral Development Resources Decree of 1974.

Mere location does not mean absolute ownership over the affected land or the mining claim. It merely segregates the located land or area from the public
domain by barring other would-be locators from locating the same and appropriating for themselves the minerals found therein. To rule otherwise would imply
that location is all that is needed to acquire and maintain rights over a located mining claim. This, we cannot approve or sanction because it is contrary to the
intention of the lawmaker that the locator should faithfully and consistently comply with the requirements for annual work and improvements in the located mining
claim.
Presidential Decree No. 1214 is in accord with Sec. 8, Art. XIV of the 1973 Constitution which states:
All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential energy, fisheries, wildlife, and other
natural resources of the Philippines belong to the State. With the exception of agricultural, industrial or commercial, residential and resettlement
lands of the public domain, natural resources shall not be alienated, and no license, concession, or lease for the exploration, development,
exploitation, or utilization of any of the natural resources shall be granted for a period exceeding twenty-five years, renewable for not more than
twenty-five years, except as to water rights for irrigation, water supply, fisheries, or industrial uses other than the development of water power, in
which cases, beneficial use may be the measure and the limit of the grant.
The same constitutional mandate is found in Sec. 2, Art. XII of the 1987 Constitution, which declares:
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. ...
WHEREFORE, premises considered, the petition is hereby DISMISSED. The temporary restraining order issued by the Court on 19 October 1978 is LIFTED
and SET ASIDE. Costs against the petitioner.
SO ORDERED.

SOUTHEAST MINDANAO GOLD MINING CORPORATION, petitioner, vs. BALITE PORTAL MINING
COOPERATIVE and others similarly situated; and THE HONORABLE ANTONIO CERILLES, in his capacity as
Secretary of the Department of Environment and Natural Resources (DENR), PROVINCIAL MINING
REGULATORY BOARD OF DAVAO (PMRB-Davao), respondents.

DECISION
YNARES-SANTIAGO, J.:

This is a petition for review of the March 19, 1998 decision of the Court of Appeals in CA-G.R. SP No. 44693, dismissing the special
civil action for certiorari, prohibition and mandamus, and the resolution dated August 19, 1998 denying petitioners motion for
reconsideration.
The instant case involves a rich tract of mineral land situated in the Agusan-Davao-Surigao Forest Reserve known as the Diwalwal
Gold Rush Area. Located at Mt. Diwata in the municipalities of Monkayo and Cateel in Davao Del Norte, the land has been embroiled
in controversy since the mid-80s due to the scramble over gold deposits found within its bowels.
From 1985 to 1991, thousands of people flocked to Diwalwal to stake their respective claims. Peace and order deteriorated rapidly,
with hundreds of people perishing in mine accidents, man-made or otherwise, brought about by unregulated mining activities. The
multifarious problems spawned by the gold rush assumed gargantuan proportions, such that finding a win-win solution became a
veritable needle in a haystack.
On March 10, 1988, Marcopper Mining Corporation (Marcopper) was granted Exploration Permit No. 133 (EP No. 133) over 4,491
hectares of land, which included the hotly-contested Diwalwal area.[1]Marcoppers acquisition of mining rights over Diwalwal under its
EP No. 133 was subsequently challenged before this Court in Apex Mining Co., Inc., et al. v. Hon. Cancio C. Garcia, et al., [2] where
Marcoppers claim was sustained over that of another mining firm, Apex Mining Corporation (Apex). The Court found that Apex did not
comply with the procedural requisites for acquiring mining rights within forest reserves.
Not long thereafter, Congress enacted on June 27, 1991 Republic Act No. 7076, or the Peoples Small-Scale Mining Act. The law
established a Peoples Small-Scale Mining Program to be implemented by the Secretary of the DENR[3] and created the Provincial Mining
Regulatory Board (PMRB) under the DENR Secretarys direct supervision and control. [4] The statute also authorized the PMRB to declare
and set aside small-scale mining areas subject to review by the DENR Secretary[5] and award mining contracts to small-scale miners under
certain conditions.[6]
On December 21, 1991, DENR Secretary Fulgencio S. Factoran issued Department Administrative Order (DAO) No. 66, declaring
729 hectares of the Diwalwal area as non-forest land open to small-scale mining.[7]The issuance was made pursuant to the powers vested
in the DENR Secretary by Proclamation No. 369, which established the Agusan-Davao-Surigao Forest Reserve.
Subsequently, a petition for the cancellation of EP No. 133 and the admission of a Mineral Production Sharing Arrangement (MPSA)
proposal over Diwalwal was filed before the DENR Regional Executive Director, docketed as RED Mines Case No. 8-8-94
entitled, Rosendo Villaflor, et al. v. Marcopper Mining Corporation.
On February 16, 1994, while the RED Mines case was pending, Marcopper assigned its EP No. 133 to petitioner Southeast Mindanao
Gold Mining Corporation (SEM),[8] which in turn applied for an integrated MPSA over the land covered by the permit.
 In due time, the Mines and Geosciences Bureau Regional Office No. XI in Davao City (MGB-XI) accepted and registered the
integrated MPSA application of petitioner. After publication of the application, the following filed their oppositions:
a) MAC Case No. 004(XI) - JB Management Mining Corporation;
b) MAC Case No. 005(XI) - Davao United Miners Cooperative;
c) MAC Case No. 006(XI) - Balite Integrated Small Scale Miners Cooperative;
d) MAC Case No. 007(XI) - Monkayo Integrated Small Scale Miners Association, Inc.;
e) MAC Case No. 008(XI) - Paper Industries Corporation of the Philippines;
f) MAC Case No. 009(XI) - Rosendo Villaflor, et al.;
g) MAC Case No. 010(XI) - Antonio Dacudao;
h) MAC Case No. 011(XI) - Atty. Jose T. Amacio;
i) MAC Case No. 012(XI) - Puting-Bato Gold Miners Cooperative;
j) MAC Case No. 016(XI) - Balite Communal Portal Mining Cooperative; and
k) MAC Case No. 97-01(XI) - Romeo Altamera, et al.
In the meantime, on March 3, 1995, Republic Act No. 7942, the Philippine Mining Act, was enacted. Pursuant to this statute, the
above-enumerated MAC cases were referred to a Regional Panel of Arbitrators (RPA) tasked to resolve disputes involving conflicting
mining rights. The RPA subsequently took cognizance of the RED Mines case, which was consolidated with the MAC cases.
On April 1, 1997, Provincial Mining Regulatory Board of Davao passed Resolution No. 26, Series of 1997, authorizing the issuance
of ore transport permits (OTPs) to small-scale miners operating in the Diwalwal mines.
Thus, on May 30, 1997, petitioner filed a complaint for damages before the Regional Trial Court of Makati City, Branch 61, against
the DENR Secretary and PMRB-Davao. SEM alleged that the illegal issuance of the OTPs allowed the extraction and hauling
of P60,000.00 worth of gold ore per truckload from SEMs mining claim.
Meanwhile, on June 13, 1997, the RPA resolved the Consolidated Mines cases and decreed in an Omnibus Resolution as follows:
VIEWED IN THE LIGHT OF THE FOREGOING, the validity of Exploration Permit No. 133 is hereby reiterated and all the adverse
claims against MPSAA No. 128 are DISMISSED.[9]
On June 24, 1997, the DENR Secretary issued Memorandum Order No. 97-03[10] which provided, among others, that:
1. The DENR shall study thoroughly and exhaustively the option of direct state utilization of the mineral resources in the Diwalwal
Gold-Rush Area. Such study shall include, but shall not be limited to, studying and weighing the feasibility of entering into management
agreements or operating agreements, or both, with the appropriate government instrumentalities or private entities, or both, in carrying
out the declared policy of rationalizing the mining operations in the Diwalwal Gold Rush Area; such agreements shall include provisions
for profit-sharing between the state and the said parties, including profit-sharing arrangements with small-scale miners, as well as the
payment of royalties to indigenous cultural communities, among others. The Undersecretary for Field Operations, as well as the
Undersecretary for Legal and Legislative Affairs and Attached Agencies, and the Director of the Mines and Geo-sciences Bureau are
hereby ordered to undertake such studies. x x x[11]
On July 16, 1997, petitioner filed a special civil action for certiorari, prohibition and mandamus before the Court of Appeals against
PMRB-Davao, the DENR Secretary and Balite Communal Portal Mining Cooperative (BCPMC), which represented all the OTP
grantees. It prayed for the nullification of the above-quoted Memorandum Order No. 97-03 on the ground that the direct state
utilization espoused therein would effectively impair its vested rights under EP No. 133; that the DENR Secretary unduly usurped and
interfered with the jurisdiction of the RPA which had dismissed all adverse claims against SEM in the Consolidated Mines cases; and that
the memorandum order arbitrarily imposed the unwarranted condition that certain studies be conducted before mining and environmental
laws are enforced by the DENR.
Meanwhile, on January 6, 1998, the MAB rendered a decision in the Consolidated Mines cases, setting aside the judgment of the
RPA.[12] This MAB decision was then elevated to this Court by way of a consolidated petition, docketed as G.R. Nos. 132475 and 132528.
On March 19, 1998, the Court of Appeals, through a division of five members voting 3-2,[13] dismissed the petition in CA-G.R. SP No.
44693. It ruled that the DENR Secretary did not abuse his discretion in issuing Memorandum Order No. 97-03 since the same was
merely a directive to conduct studies on the various options available to the government for solving the Diwalwal conflict. The assailed
memorandum did not conclusively adopt direct state utilization as official government policy on the matter, but was simply a
manifestation of the DENRs intent to consider it as one of its options, after determining its feasibility through studies. MO 97-03 was
only the initial step in the ladder of administrative process and did not, as yet, fix any obligation, legal relationship or right. It was thus
premature for petitioner to claim that its constitutionally-protected rights under EP No. 133 have been encroached upon, much less,
violated by its issuance.
Additionally, the appellate court pointed out that petitioners rights under EP No. 133 are not inviolable, sacrosanct or
immutable. Being in the nature of a privilege granted by the State, the permit can be revoked, amended or modified by the Chief
Executive when the national interest so requires. The Court of Appeals, however, declined to rule on the validity of the OTPs, reasoning
that said issue was within the exclusive jurisdiction of the RPA.
Petitioner filed a motion for reconsideration of the above decision, which was denied for lack of merit on August 19, 1998.[14]
Hence this petition, raising the following errors:
I. THE COURT OF APPEALS COMMITTED GRAVE AND REVERSIBLE ERROR, AND HAS DECIDED A QUESTION OF SUBSTANCE NOT
THERETOFORE DETERMINED BY THIS HONORABLE SUPREME COURT, OR HAS DECIDED IT IN A WAY PROBABLY NOT IN ACCORD
WITH LAW OR WITH APPLICABLE DECISIONS OF THIS HONORABLE COURT IN UPHOLDING THE QUESTIONED ACTS OF
RESPONDENT DENR SECRETARY WHICH ARE IN VIOLATION OF MINING LAWS AND IN DEROGATION OF PETITIONERS VESTED
RIGHTS OVER THE AREA COVERED BY ITS EP NO. 133;
II. THE COURT OF APPEALS COMMITTED GRAVE AND REVERSIBLE ERROR IN HOLDING THAT AN ACTION ON THE VALIDITY OF ORE
TRANSPORT PERMIT (OTP) IS VESTED IN THE REGIONAL PANEL OF ARBITRATORS.[15]
 In a resolution dated September 11, 2000, the appealed Consolidated Mines cases, docketed as G.R. Nos. 132475 and 132528, were
referred to the Court of Appeals for proper disposition pursuant to Rule 43 of the 1997 Rules of Civil Procedure. [16] These cases, which
were docketed as CA-G.R. SP Nos. 61215 and 61216, are still pending before the Court of Appeals.
In the first assigned error, petitioner insists that the Court of Appeals erred when it concluded that the assailed memorandum order
did not adopt the direct state utilization scheme in resolving the Diwalwal dispute. On the contrary, petitioner submits, said
memorandum order dictated the said recourse and, in effect, granted management or operating agreements as well as provided for profit
sharing arrangements to illegal small-scale miners.
According to petitioner, MO 97-03 was issued to preempt the resolution of the Consolidated Mines cases. The direct state
utilization scheme espoused in the challenged memorandum is nothing but a legal shortcut, designed to divest petitioner of its vested
right to the gold rush area under its EP No. 133.
We are not persuaded.
We agree with the Court of Appeals ruling that the challenged MO 97-03 did not conclusively adopt direct state utilization as a
policy in resolving the Diwalwal dispute. The terms of the memorandum clearly indicate that what was directed thereunder was merely
a study of this option and nothing else. Contrary to petitioners contention, it did not grant any management/operating or profit-sharing
agreement to small-scale miners or to any party, for that matter, but simply instructed the DENR officials concerned to undertake studies
to determine its feasibility. As the Court of Appeals extensively discussed in its decision:
x x x under the Memorandum Order, the State still had to study prudently and exhaustively the various options available to it in
rationalizing the explosive and ever perilous situation in the area, the debilitating adverse effects of mining in the community and at the
same time, preserve and enhance the safety of the mining operations and ensure revenues due to the government from the development of
the mineral resources and the exploitation thereof. The government was still in earnest search of better options that would be fair and just
to all parties concerned, including, notably, the Petitioner. The direct state utilization of the mineral resources in the area was only one of
the options of the State. Indeed, it is too plain to see, x x x that before the State will settle on an option, x x x an extensive and intensive
study of all the facets of a direct state exploitation was directed by the Public Respondent DENR Secretary. And even if direct state
exploitation was opted by the government, the DENR still had to promulgate rules and regulations to implement the same x x x, in
coordination with the other concerned agencies of the government.[17]
Consequently, the petition was premature. The said memorandum order did not impose any obligation on the claimants or fix any
legal relation whatsoever between and among the parties to the dispute. At this stage, petitioner can show no more than a mere
apprehension that the State, through the DENR, would directly take over the mines after studies point to its viability. But until the DENR
actually does so and petitioners fears turn into reality, no valid objection can be entertained against MO 97-03 on grounds which are
purely speculative and anticipatory.[18]
 With respect to the alleged vested rights claimed by petitioner, it is well to note that the same is invariably based on EP No. 133,
whose validity is still being disputed in the Consolidated Mines cases. A reading of the appealed MAB decision reveals that the
continued efficacy of EP No. 133 is one of the issues raised in said cases, with respondents therein asserting that Marcopper cannot
legally assign the permit which purportedly had expired. In other words, whether or not petitioner actually has a vested right over
Diwalwal under EP No. 133 is still an indefinite and unsettled matter. And until a positive pronouncement is made by the appellate court
in the Consolidated Mines cases, EP No. 133 cannot be deemed as a source of any conclusive rights that can be impaired by the issuance
of MO 97-03.
Similarly, there is no merit in petitioners assertion that MO 97-03 sanctions violation of mining laws by allowing illegal miners to
enter into mining agreements with the State. Again, whether or not respondent BCMC and the other mining entities it represents are
conducting illegal mining activities is a factual matter that has yet to be finally determined in the Consolidated Mines cases. We cannot
rightfully conclude at this point that respondent BCMC and the other mining firms are illegitimate mining operators. Otherwise, we
would be preempting the resolution of the cases which are still pending before the Court of Appeals.[19]
Petitioners reliance on the Apex Mining case to justify its rights under E.P. No. 133 is misplaced. For one, the said case was litigated
solely between Marcopper and Apex Mining Corporation and cannot thus be deemed binding and conclusive on respondent BCMC and
the other mining entities presently involved. While petitioner may be regarded as Marcoppers successor to EP No. 133 and therefore
bound by the judgment rendered in the Apex Mining case, the same cannot be said of respondent BCMC and the other oppositor mining
firms, who were not impleaded as parties therein.
Neither can the Apex Mining case foreclose any question pertaining to the continuing validity of EP No. 133 on grounds which
arose after the judgment in said case was promulgated. While it is true that the Apex Mining case settled the issue of who between Apex
and Marcopper validly acquired mining rights over the disputed area by availing of the proper procedural requisites mandated by law, it
certainly did not deal with the question raised by the oppositors in the Consolidated Mines cases, i.e. whether EP No. 133 had already
expired and remained valid subsequent to its transfer by Marcopper to petitioner. Besides, as clarified in our decision in the Apex
Mining case:
x x x is conclusive only between the parties with respect to the particular issue herein raised and under the set of circumstances herein
prevailing. In no case should the decision be considered as a precedent to resolve or settle claims of persons/entities not parties
hereto. Neither is it intended to unsettle rights of persons/entities which have been acquired or which may have accrued upon reliance on
laws passed by appropriate agencies.[20]
Clearly then, the Apex Mining case did not invest petitioner with any definite right to the Diwalwal mines which it could now set up
against respondent BCMC and the other mining groups.
Incidentally, it must likewise be pointed out that under no circumstances may petitioners rights under EP No. 133 be regarded as
total and absolute. As correctly held by the Court of Appeals in its challenged decision, EP No. 133 merely evidences a privilege granted
by the State, which may be amended, modified or rescinded when the national interest so requires. This is necessarily so since the
exploration, development and utilization of the countrys natural mineral resources are matters impressed with great public interest. Like
timber permits, mining exploration permits do not vest in the grantee any permanent or irrevocable right within the purview of the non-
impairment of contract and due process clauses of the Constitution, [21] since the State, under its all-encompassing police power, may alter,
modify or amend the same, in accordance with the demands of the general welfare.[22]
Additionally, there can be no valid opposition raised against a mere study of an alternative which the State, through the DENR, is
authorized to undertake in the first place. Worth noting is Article XII, Section 2, of the 1987 Constitution, which specifically provides:
SEC. 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 sixty per centum of 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. (Underscoring ours)
Likewise, Section 4, Chapter II of the Philippine Mining Act of 1995 states:
SEC. 4. Ownership of Mineral Resources. - Mineral Resources are owned by the State and the exploration, development, utilization, and
processing thereof shall be under its full control and supervision. The State may directly undertake such activities or it may enter into
mineral agreements with contractors. (Underscoring ours)
Thus, the State may pursue the constitutional policy of full control and supervision of the exploration, development and utilization of
the countrys natural mineral resources, by either directly undertaking the same or by entering into agreements with qualified
entities. The DENR Secretary acted within his authority when he ordered a study of the first option, which may be undertaken
consistently in accordance with the constitutional policy enunciated above. Obviously, the State may not be precluded from considering a
direct takeover of the mines, if it is the only plausible remedy in sight to the gnawing complexities generated by the gold rush. As
implied earlier, the State need be guided only by the demands of public interest in settling for this option, as well as its material and
logistic feasibility.
In this regard, petitioners imputation of bad faith on the part of the DENR Secretary when the latter issued MO 97-03 is not well-
taken. The avowed rationale of the memorandum order is clearly and plainly stated in its whereas clauses.[23] In the absence of any
concrete evidence that the DENR Secretary violated the law or abused his discretion, as in this case, he is presumed to have regularly
issued the memorandum with a lawful intent and pursuant to his official functions.
Given these considerations, petitioners first assigned error is baseless and premised on tentative assumptions. Petitioner cannot
claim any absolute right to the Diwalwal mines pending resolution of the Consolidated Mines cases, much less ask us to assume, at this
point, that respondent BCMC and the other mining firms are illegal miners. These factual issues are to be properly threshed out in CA
G.R. SP Nos. 61215 and 61216, which have yet to be decided by the Court of Appeals. Any objection raised against MO 97-03 is
likewise premature at this point, inasmuch as it merely ordered a study of an option which the State is authorized by law to undertake.
We see no need to rule on the matter of the OTPs, considering that the grounds invoked by petitioner for invalidating the same are
inextricably linked to the issues raised in the Consolidated Mines cases.
WHEREFORE, in view of the foregoing, the instant petition is DENIED. The decision of the Court of Appeals in CA-G.R. SP No.
44693 is AFFIRMED.
SO ORDERED.
G.R. No. L-69997 September 30, 1987
UNGAY MALOBAGO MINES, INC., petitioner,
vs.
HON. INTERMEDIATE APPELLATE COURT, DIRECTOR OF LANDS, GREGORIA BOLANOS, AUREA ARAOJO, GERVACIO ARAOJO, MARIA BERNAL,
FELIX DETECIO, JESUS ASUNCION, MELENCIO ASUNCION and BIENVENIDO ASUNCION, respondents.

GUTIERREZ, JR., J.:

Before us is a petition which seeks to set aside the decision of the then Intermediate Appellate Court affirming the dismissal of the petitioner's action for
annulment and cancellation of free patents granted to the private respondents on the ground that the petitioner has no personality to file an action for reversion,
the lands involved being public In character.
On July 20, 1962, the President of the Philippines granted the following mining patents on mineral claims located at Ungay Malobago, Rapu-Rapu Albay.
1. lode patent No. V-52 to John Canson, Jr., on mineral claim known as "Catanduandes;"
2. lode patent No. V-48 to petitioner, on mineral claims known as "Junior;"
3. lode patent No. V-53 to John Canson, Jr., on mineral claims known as "Oas;"
4. lode patent No. V - 46 to petitioner on mineral claim known as "Ester;"
5. lode patent No. V - 51 to Carlos Stilianopulos on mineral claim known as "Jovellar;"
6. lode patent No. V - 49 to petitioner, in mineral claim known as "Manila;"
7. lode patent No. V - 50 to Carlos Stilianopulos on mineral claim known as "Polangui;" and
8. lode patent No. V - 47 to petitioner on mineral claim known as "Ligao;"(pp. 5-7, Decision Annex 1, Petition)
Way back on October 30, 1959, John Canson, Jr. and Carlos Stilianopulos assigned their rights to their mining claims in favor of the petitioner. The assignment
of rights was recorded in the Office of the Mining Recorder of Albay on December 2, 1959.
The aforestated mining patents, after their issuance on July 20, 1962, were all recorded in the Office of the Mining Recorder of Albay on August 28, 1962 and
transcribed on September 4, 1962 in the Registration Book of the Registry of Deeds of Albay. Consequently, the Register of Deeds of Albay issued the
respective original certificates of titles pursuant to Section 122 of Act No. 496 in the names of John Canson, Jr., Carlos Stilianopulos, and the petitioner.
Subsequently, or from 1968 to 1974, the following free patents were granted by the respondent Director of Lands and the corresponding original certificates of
titles were issued by the Register of Deeds of Albay:
1. Free Patent No. 458143 dated October 3, 1968 and corresponding Certificate of Title No. VH-12195 to appellee Felix Detecio;
2. Free Patent No. 427824 dated November 21, 1968 and corresponding Certificate of Title No. VH-12256 to appellee Melencio Asuncion;
3. Free Patent No. 433318 dated January 10, 1969 and corresponding Certificate of Title No. VH-12198 to appellee Jesus Asuncion;
4. Free Patents No. 422847 dated November 11, 1968 and No. 421947 dated October 28, 1969 and corresponding Certificates of Title Nos. VH-
12185 and 12186, respectively, to appellee Maria Bernal;
5. Free Patent No. 408568 dated July 8, 1968 and corresponding Certificate of Title No. VH-11591 to appellee Gregorio Bolanos; and
6. Free Patent No. 0663 dated March 25, 1974 and the corresponding Certificate of Title No. VH-19333 to appellee Bienvenido Asuncion. (Rollo,
pp. 200-201)
All of the above patents covered portions of the lots covered by the patents belonging to the petitioner.
The petitioner filed a complaint for annulment and cancellation of patents against the private respondents and prayed that all the free patent titles issued in their
favor for properties over which original certificates of title had already been issued in its favor be declared null and void.
The Director of Lands, who was impleaded as a formal defendant, filed his answer alledging, among others, that the petitioner has no personality to institute the
cancellation proceedings inasmuch as the government is the grantor and not the petitioner, and it should be the grantor who should institute the cancellation
proceedings.
On January 25, 1980, the trial court rendered a decision dismissing the complaint. It ruled that since the disputed properties form part of disposable land of the
public domain, the action for reversion should be instituted by the Solicitor General in the name of the Republic of the Philippines and that, therefore, the
petitioner lacks personality to institute the annulment proceedings.
The petitioner appealed to the then Intermediate Appellate Court.
On April 5, 1984, the appellate court affirmed the decision of the trial court. It ruled that the titles issued to the petitioner cover mineral lands which belong to the
public domain and that these cannot be the subject of private ownership. According to the Court, under Section 101 of the Public Land Law, only the Solicitor
General or the officer acting in his stead has the authority to institute an action on behalf of the Republic for the cancellation of the respondents' titles and for
reversion of their homesteads to the Government.
In this instant petition, the petitioner raises two issues: a) Whether or not the appellate court committed an error of law when it ruled that the lands in question
belong to the public domain; and b) whether or not the appellate court erred in discussing the complaint on the ground that the petitioner had no personality to
institute the same.
With regard to the first issue, the petitioner maintains that since its mining claims were perfected prior to November 15, 1935, the date when the 1935
Constitution took effect, the applicable law is the Philippine Bill of 1902 and that under this Act, a valid location of a mining claim segregates the area from the
public domain. (Gold Creek Mining Corporation v. Rodriguez, 66 Phil. 259).
The Solicitor-General, on the other hand, argues that the petitioner's mining patents covered by Torrens Titles were granted only in 1962 by the President of the
Philippines, by authority of the Constitution of the Philippines. Under the then Constitution, except for public agricultural lands, natural resources which includes
all mineral lands, shall not be alienated. (Art. XIII, Section 1, 1935 Constitution) Therefore, what the mining patents issued in 1962 conveyed to petitioner was
only the ownership of, and the right to extract and utilize, the minerals within the area covered by the petitioner's Torrens Titles but not the ownership of the land
where the minerals are found.
We rule for the private respondents.
The petitioner has been beguiling, less than candid, and inexplicably silent as to material dates in the presentation of its case. Nowhere in the records of this
petition is there any mention of a date before November 15, 1935 as to when essential acts regarding its mining claims were executed. It is silent as to when the
land was entered, measured, and plotted; when the legal posts and notices were put up; when the claim was registered with the mining recorder; whether or not
the annual amount of labor or development, and other requirements under the Philippine Bill of 1902 were followed. These may have been complied with but not
necessarily before 1935.
A mere mention in the Torrens title that the provisions of the Philippine Bill of 1902 were followed is not sufficient. The Philippine Bill provides the procedures for
the perfection of mining claims but not the dates when such procedures were undertaken by any prospector or claimant. The same procedures would have to be
followed even after the Jones Law of 1916 and the Constitution of 1935 were promulgated, but subject to the restrictions of the fundamental law. The petitioner
has failed to state if and when new procedures, different from the 1902 procedures, were provided by law to give a little substance to its case. The petitioner is
completely and strangely silent about these vital aspects of its petition.
Petitioner has not established by clear and convincing evidence that the locations of its mining claims were perfected prior to November 15,1935 when the
Government of Commonwealth was inaugurated. In fact neither the original complaint nor the amended one alleged the perfection of petitioner's mining rights
prior to November 15, 1935. All that petitioner offers as evidence of its claims were the original certificates of titles covering mining patents which embodied a
uniform "WHEREAS" clause stating that the petitioner "has fully complied with all the conditions, requirements, and provisions of the Act of the United States of
Congress of July 1, 1902, as amended, ..." In the absence of proof that the petitioner's claims were perfected prior to the 1935 Constitution, the provision of the
latter with regard to inalienable lands of the public domain will apply.
Article XIII, Section I of the 1935 Constitution provides:
All agricultural timber, and mineral lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential
energy, and other natural resources of the Philippines belong to the State, and their disposition, exploitation, development, or utilization shall be
limited to citizens of the Philippines, or to corporations or associations at least sixty per centum of the capital of which is owned by such citizens,
subject to any existing right, grant, lease, or concession at the time of the inauguration of the Government established under this
Constitution. Natural resources, with the exception of public agricultural land, shall not be alienated and no license, concession, or lease for the
exploitation, development, or utilization of any of the natural resources shall be granted for a period exceeding twenty-five years, renewable for
another twenty-five years, except as to water rights for irrigation, water supply, fisheries, or industrial uses other than the development of water
power, in which cases beneficial use may be the measure and the at of the grant. (Emphasis supplied)
Therefore, applying the aforequoted provision to the case at bar, we conclude that the issuance of the lode patents on mineral claims by the President of the
Philippines in 1962 in favor of the petitioner granted to it only the right to extract or utilize the minerals which may be found on or under the surface of the land.
On the other hand, the issuance of the free patents by the respondent Director of Lands in 1979 in favor of the private respondents granted to them the
ownership and the right to use the land for agricultural purposes but excluding the ownership of, and the right to extract or utilize, the minerals which may be
found on or under the surface.
There is no basis in the records for the petitioner's stand that it acquired the right to the mineral lands prior to the effectivity of the 1935 Constitution, thus,
making such acquisition outside its purview and scope.
Every application for a concession of public land has to be viewed in the light of its peculiar circumstances. (Director of Lands v. Funtilar 142 SCRA 57, 69).
In the case at bar, although the original certificates of titles of the petitioner were issued prior to the titles of the private respondents, the former cannot prevail
over the latter for the provisions of the Constitution which governed at the time of their issuance prohibited the alienation of mineral lands of the public domain.
In the case of Republic v. Animas (56 SCRA 499), this Court ruled that a grantee does not become the owner of a land illegally included in the grant just
because title has been issued in his favor:.
A patent is void at law if the officer who issued the patent had no authority to do so (Knight v. Land Ass. 142 U.S. 161, 12 Sup. Ct., 258, 35L ED.
974; emphasis supplied). If a person obtains a title under the Public Land Act which includes, by mistake or oversight, lands which cannot be
registered under the Torrens System, or when the Director of Lands did not have jurisdiction over the same because it is a public forest, the
 grantee does not, by virtue of said certificate of title alone, become the owner of the land illegally included. (See Ledesma vs. Municipality of
Iloilo, 49 Phil. 769)
Moreover, patents and land grants are construed favorably in favor of the Government, and most strongly against the grantee. Any doubt as to the intention or
extent of the grant, or the intention of the Government, is to be resolved in its favor. (See Republic v. Court of Appeals, 73 SCRA 146, 156). Hence, as earlier
stated, in the absence of proof that the petitioner acquired the right of ownership over the mineral lands prior to the 1935 Constitution, the titles issued in its favor
must be construed as conveying only the right to extract and utilize the minerals thereon.
The appellate court did not likewise err in concluding that the petitioner has no personality to institute the action below for annulment and cancellation of patents.
The mineral lands over which it has a right to extract minerals remained part of the inalienable lands of the public domain and thus, only the Solicitor General or
the person acting in his stead can bring an action for reversion. (See Sumail v. Judge of the Court of First Instance of Cotabato, et al., 96 Phil. 946; and Heirs of
Tanak Pangawaran Patiwayan v. Martinez, 142 SCRA 252).
WHEREFORE, the petition is hereby DISMISSED for lack of merit. The decision of the Intermediate Appellate Court is AFFIRMED. Costs against the petitioner.
SO ORDERED.