Republic of the
SUPREME COURT
Manila
EN BANC
FRANCISCO
I. CHAVEZ, G.R. No. 164527
Petitioner,
Present:
PUNO,
CJ,
QUISUMBING,
YNARES-SANTIAGO,
SANDOVAL-GUTIERREZ,
- versus - CARPIO,
AUSTRIA-MARTINEZ,
CORONA,
CARPIO MORALES,
AZCUNA,
TINGA,
CHICO-NAZARIO,
GARCIA,
NATIONAL HOUSING VELASCO,
AUTHORITY, R-II BUILDERS, NACHURA, and
INC., R-II HOLDINGS, INC., REYES, JJ.
TERMINAL, INC., and Promulgated:
MR. REGHIS ROMERO II,
Respondents. August 15, 2007
x-----------------------------------------------------------------------------------------x
D E C I S I O N
VELASCO,
JR., J.:
In
this Petition for Prohibition and Mandamus with Prayer for Temporary
Restraining Order and/or Writ of Preliminary Injunction under Rule 65,
petitioner, in his capacity as taxpayer, seeks:
to declare NULL AND VOID the Joint Venture Agreement (JVA) dated March 9, 1993 between the National Housing Authority and R-II Builders, Inc. and the Smokey Mountain Development and Reclamation Project embodied therein; the subsequent amendments to the said JVA; and all other agreements signed and executed in relation thereto – including, but not limited to the Smokey Mountain Asset Pool Agreement dated 26 September 1994 and the separate agreements for Phase I and Phase II of the Project––as well as all other transactions which emanated therefrom, for being UNCONSTITUTIONAL and INVALID;
to enjoin respondents—particularly respondent NHA—from further implementing and/or enforcing the said project and other agreements related thereto, and from further deriving and/or enjoying any rights, privileges and interest therefrom x x x; and
to compel respondents to disclose all documents and information relating to the project––including, but not limited to, any subsequent agreements with respect to the different phases of the project, the revisions over the original plan, the additional works incurred thereon, the current financial condition of respondent R-II Builders, Inc., and the transactions made respecting the project.[1]
The Facts
On
Specifically,
respondent NHA was ordered to “conduct feasibility studies and develop low-cost
housing projects at the dumpsite and absorb scavengers in NHA
resettlement/low-cost housing projects.”[4] On the other hand, the DENR was tasked to
“review and evaluate proposed projects under the Plan with regard to their
environmental impact, conduct regular monitoring of activities of the Plan to
ensure compliance with environmental standards and assist DOH in the conduct of
the study on hospital waste management.”[5]
At
the time MO 161-A was issued by President Aquino,
Pursuant
to MO 161-A, NHA prepared the feasibility studies of the Smokey Mountain
low-cost housing project which resulted in the formulation of the “Smokey
Mountain Development Plan and Reclamation of the Area Across R-10” or the
Smokey Mountain Development and Reclamation Project (SMDRP; the Project). The Project aimed to convert the
On
RA
6957 defined “build-and-transfer” scheme as “[a] contractual arrangement
whereby the contractor undertakes the construction, including financing, of a
given infrastructure facility, and its turnover after the completion to the
government agency or local government unit concerned which shall pay the
contractor its total investment expended on the project, plus reasonable rate
of return thereon.” The last paragraph
of Sec. 6 of the BOT Law provides that the repayment scheme in the case of
“land reclamation or the building of industrial estates” may consist of “[t]he
grant of a portion or percentage of the reclaimed land or industrial estate
built, subject to the constitutional requirements with respect to the ownership
of lands.”
On
Section
1. There is hereby approved the following national infrastructure projects for
implementation under the provisions of Republic Act No. 6957 and its implementing
rules and regulations:
x x x x
(d) Port
infrastructure like piers, wharves, quays, storage handling, ferry service and
related facilities;
x x x x
(k) Land
reclamation, dredging and other related development facilities;
(l) Industrial
estates, regional industrial centers and export processing zones including
steel mills, iron-making and petrochemical complexes and related infrastructure
and utilities;
x x x x
(p) Environmental
and solid waste management-related facilities such as collection equipment,
composting plants, incinerators, landfill and tidal barriers, among others; and
(q) Development of new townsites and communities and related facilities.
This
resolution complied with and conformed to Sec. 4 of the BOT Law requiring the
approval of all national infrastructure projects by the Congress.
On
Section
3. The National Housing Authority is
hereby directed to implement the Smokey Mountain Development Plan and
Reclamation of the Area Across R-10 through
a private sector joint venture scheme at the least cost to the government.
Section 4. The land area covered by the
In
addition, the Public Estates Authority (PEA) was directed to assist in the
evaluation of proposals regarding the technical feasibility of reclamation,
while the DENR was directed to (1) facilitate titling of
In
the same MO 415, President Aquino created an Executive Committee (EXECOM) to
oversee the implementation of the Plan, chaired by the National Capital Region-Cabinet
Officer for Regional Development (NCR-CORD) with the heads of the NHA, City of
In
conformity with Sec. 5 of MO 415, an inter-agency technical committee (TECHCOM)
was created composed of the technical representatives of the EXECOM “[t]o
assist the NHA in the evaluation of the project proposals, assist in the
resolution of all issues and problems in the project to ensure that all aspects
of the development from squatter relocation, waste management, reclamation,
environmental protection, land and house construction meet governing regulation
of the region and to facilitate the completion of the project.”[13]
Subsequently,
the TECHCOM put out the Public Notice and Notice to Pre-Qualify and Bid for the
right to become NHA’s joint venture partner in the implementation of the
SMDRP. The notices were published in
newspapers of general circulation on January 23 and 26 and February 1, 14, 16,
and 23, 1992, respectively. Out of the
thirteen (13) contractors who responded, only five (5) contractors fully
complied with the required pre-qualification documents. Based on the evaluation of the
pre-qualification documents, the EXECOM declared the New San Jose Builders,
Inc. and R-II Builders, Inc. (RBI) as the top two contractors.[14]
Thereafter,
the TECHCOM evaluated the bids (which include the Pre-feasibility Study and
Financing Plan) of the top two (2) contractors in this manner:
(1) The DBP, as financial advisor to the
Project, evaluated their Financial Proposals;
(2) The DPWH, PPA, PEA and NHA evaluated the
Technical Proposals for the Housing Construction and Reclamation;
(3) The DENR evaluated Technical Proposals on
Waste Management and Disposal by conducting the Environmental Impact Analysis;
and
(4) The NHA and the City of
On
On
Subsequently, the EXECOM made a
Project briefing to President Ramos. As
a result, President Ramos issued Proclamation No. 39[15]
on
WHEREAS,
the National Housing Authority has presented a viable conceptual plan to
convert the Smokey Mountain dumpsite into a habitable housing project,
inclusive of the reclamation of the area across Road Radial 10 (R-10) adjacent
to the Smokey Mountain as the enabling component of the project;
x x x x
These
parcels of land of public domain are hereby placed under the administration and
disposition of the National Housing Authority to develop, subdivide and dispose
to qualified beneficiaries, as well as its development for mix land use
(commercial/industrial) to provide employment opportunities to on-site families
and additional areas for port-related activities.
In order to facilitate the early development of the area for disposition, the Department of Environment and Natural Resources, through the Lands and Management Bureau, is hereby directed to approve the boundary and subdivision survey and to issue a special patent and title in the name of the National Housing Authority, subject to final survey and private rights, if any there be. (Emphasis supplied.)
On
On
The
Scope of Work of RBI under Article II of the JVA is as follows:
a) To fully finance all aspects of
development of
b) To
immediately commence on the preparation of feasibility report and detailed
engineering with emphasis to the expedient acquisition of the Environmental
Clearance Certificate (ECC) from the DENR.
c) The
construction activities will only commence after the acquisition of the ECC,
and
d) Final details of the contract, including construction, duration and delivery timetables, shall be based on the approved feasibility report and detailed engineering.
Other
obligations of RBI are as follows:
2.02 The [RBI] shall develop the PROJECT based
on the Final Report and Detailed Engineering as approved by the Office of the
President. All costs and expenses for hiring technical personnel, date
gathering, permits, licenses, appraisals, clearances, testing and similar
undertaking shall be for the account of the [RBI].
2.03 The
[RBI] shall undertake the construction of 3,500 temporary housing units
complete with basic amenities such as plumbing, electrical and sewerage
facilities within the temporary housing project as staging area to temporarily
house the squatter families from the
2.04 The
[RBI] shall construct 3,500 medium rise low cost permanent housing units on the
leveled
2.05 The
[RBI] shall reclaim forty (40) hectares of
2.06 The [RBI] shall likewise furnish all labor materials and equipment necessary to complete all herein development works to be undertaken on a phase to phase basis in accordance with the work program stipulated therein.
The
profit sharing shall be based on the approved pre-feasibility report submitted
to the EXECOM, viz:
For
the developer (RBI):
1. To own the forty (40) hectares of
reclaimed land.
2. To
own the commercial area at the
3. To own all the constructed units of medium rise low cost permanent housing units beyond the 3,500 units share of the [NHA].
For the NHA:
1. To own the temporary housing consisting
of 3,500 units.
2. To
own the cleared and fenced incinerator site consisting of 5 hectares situated
at the
3. To
own the 3,500 units of permanent housing to be constructed by [RBI] at the
4. To
own the Industrial Area site consisting of 3.2 hectares, and
5. To
own the open spaces, roads and facilities within the
In
the event of “extraordinary increase in labor, materials, fuel and
non-recoverability of total project expenses,”[20]
the OP, upon recommendation of the NHA, may approve a corresponding adjustment
in the enabling component.
The
functions and responsibilities of RBI and NHA are as follows:
For
RBI:
4.01 Immediately commence on the preparation of
the FINAL REPORT with emphasis to the expedient acquisition, with the
assistance of the [NHA] of Environmental Compliance Certificate (ECC) from the
Environmental Management Bureau (EMB) of the [DENR]. Construction shall only commence after the
acquisition of the ECC. The Environment
Compliance Certificate (ECC) shall form part of the FINAL REPORT.
The FINAL REPORT shall provide the
necessary subdivision and housing plans, detailed engineering and architectural
drawings, technical specifications and other related and required documents
relative to the
With respect to the 40-hectare reclamation area, the [RBI] shall have the discretion to develop the same in a manner that it deems necessary to recover the [RBI’s] investment, subject to environmental and zoning rules.
4.02 Finance
the total project cost for land development, housing construction and
reclamation of the PROJECT.
4.03 Warrant
that all developments shall be in compliance with the requirements of the FINAL
REPORT.
4.04 Provide
all administrative resources for the submission of project accomplishment
reports to the [NHA] for proper evaluation and supervision on the actual
implementation.
4.05 Negotiate
and secure, with the assistance of the [NHA] the grant of rights of way to the
PROJECT, from the owners of the adjacent lots for access road, water,
electrical power connections and drainage facilities.
4.06 Provide temporary field office and transportation vehicles (2 units), one (1) complete set of computer and one (1) unit electric typewriter for the [NHA’s] field personnel to be charged to the PROJECT.
For
the NHA:
4.07 The [NHA] shall be responsible for the
removal and relocation of all squatters within
4.08 Assist
the [RBI] and shall endorse granting of exemption fees in the acquisition of
all necessary permits, licenses, appraisals, clearances and accreditations for
the PROJECT subject to existing laws, rules and regulations.
4.09 The
[NHA] shall inspect, evaluate and monitor all works at the
4.10 The
[NHA] shall assist the [RBI] in the complete electrification of the PROJECT. x x x
4.11 Handle
the processing and documentation of all sales transactions related to its
assets shares from the venture such as the 3,500 units of permanent housing and
the allotted industrial area of 3.2 hectares.
4.12 All
advances outside of project costs made by the [RBI] to the [NHA] shall be
deducted from the proceeds due to the [NHA].
4.13 The
[NHA] shall be responsible for the acquisition of the Mother Title for the
The
final details of the JVA, which will include the construction duration, costs,
extent of reclamation, and delivery timetables, shall be based on the FINAL
REPORT which will be contained in a Supplemental Agreement to be executed later
by the parties.
The
JVA may be modified or revised by written agreement between the NHA and RBI
specifying the clauses to be revised or modified and the corresponding
amendments.
If
the Project is revoked or terminated by the Government through no fault of RBI
or by mutual agreement, the Government shall compensate RBI for its actual
expenses incurred in the Project plus a reasonable rate of return not exceeding
that stated in the feasibility study and in the contract as of the date of such
revocation, cancellation, or termination on a schedule to be agreed upon by
both parties.
As
a preliminary step in the project implementation, consultations and dialogues
were conducted with the settlers of the Smokey Mountain Dumpsite Area. At the same time, DENR started processing the
application for the Environmental Clearance Certificate (ECC) of the
SMDRP. As a result however of the
consultative dialogues, public hearings, the report on the on-site field
conditions, the Environmental Impact Statement (EIS) published on April 29 and
May 12, 1993 as required by the Environmental Management Bureau of DENR, the
evaluation of the DENR, and the recommendations from other government agencies,
it was discovered that design changes and additional work have to be undertaken
to successfully implement the Project.[21]
Thus,
on
The PROJECT shall
consist of Phase I and Phase II.
Phase I shall involve the following:
a. the construction of 2,992 units of temporary housing for the affected residents while clearing and development of Smokey Mountain [are] being undertaken
b.
the clearing of
c.
the reclamation and development of a 79 hectare area
directly across Radial Road 10 to serve
as the enabling component of Phase
I
Phase II shall involve the following:
a. the construction and operation of an incinerator plant that will conform to the emission standards of the DENR
b. the reclamation and development of 119-hectare area contiguous to that to be reclaimed under Phase I to serve as the enabling component of Phase II.
Under
the ARJVA, RBI shall construct 2,992 temporary housing units, a reduction from
3,500 units under the JVA.[27] However, it was required to construct 3,520
medium-rise low-cost permanent housing units instead of 3,500 units under the
JVA. There was a substantial change in
the design of the permanent housing units such that a “loft shall be
incorporated in each unit so as to increase the living space from 20 to 32
square meters. The additions and changes in the Original Project Component are
as follows:
ORIGINAL CHANGES/REVISIONS
1. TEMPORARY HOUSING
Wood/Plywood, ga. 31 G.I. Concrete/Steel Frame Structure Sheet usable life of 3 years, gauge 26 G.I. roofing sheets future 12 SM floor area. use as permanent structures for factory and warehouses mixed 17 sm & 12 sm floor area.
2. MEDIUM RISE MASS
HOUSING
Box type precast Shelter Conventional and precast component 20 square meter concrete structures, 32 square floor area with 2.4 meter meter floor area with loft floor height; bare type, 160 units/ (sleeping quarter) 3.6 m. floor building. height, painted and improved
architectural façade, 80 units/
building.
3. MITIGATING MEASURES
3.1 For reclamation work Use of clean dredgefill material below the MLLW and SM material mixed with dredgefill above MLLW.
a. 100% use of Smokey
Mountain material as
dredgefill Use of Steel Sheet Piles needed
for longer depth of embedment.
b. Concrete Sheet Piles
short depth of
embedment
c. Silt removal approximately Need to remove more than 3.0
1.0 meter only meters of silt after sub-soil investigation.[28]
These material and substantial
modifications served as justifications for the increase in the share of RBI
from 40 hectares to 79 hectares of reclaimed land.
Under the JVA, the
specific costs of the Project were not stipulated but under the ARJVA, the
stipulated cost for Phase I was pegged at six billion six hundred ninety-three
million three hundred eighty-seven thousand three hundred sixty-four pesos (PhP
6,693,387,364).
In his
On August 11, 1994, the NHA and RBI executed an Amendment To
the Amended and Restated Joint Venture Agreement (AARJVA)[29]
clarifying certain terms and condition of the ARJVA, which was submitted to
President Ramos for approval, to wit:
Phase II shall
involve the following:
a. the construction and operation of an incinerator plant that will conform to the emission standards of the DENR
b. the reclamation and development of
119-hectare area contiguous to that to be reclaimed under Phase I to serve as
the enabling component of Phase II, the
exact size and configuration of which shall be approved by the SMDRP Committee[30]
Other substantial
amendments are the following:
4. Paragraph 2.05 of Article II of the ARJVA is hereby amended to read as follows:
2.05. The DEVELOPER shall reclaim seventy nine (79) hectares of the Manila Bay area directly across Radial Road 10 (R-10) to serve as payment to the DEVELOPER as its asset share for Phase I and to develop such land into commercial area with port facilities; provided, that the port plan shall be integrated with the Philippine Port Authority’s North Harbor plan for the Manila Bay area and provided further, that the final reclamation and port plan for said reclaimed area shall be submitted for approval by the Public Estates Authority and the Philippine Ports Authority, respectively: provided finally, that subject to par. 2.02 above, actual reclamation work may commence upon approval of the final reclamation plan by the Public Estates Authority.
x x x x
9. A new paragraph to be numbered 5.05 shall be added to Article V of the ARJVA, and shall read as follows:
5.05. In the event this Agreement is revoked, cancelled or terminated by the AUTHORITY through no fault of the DEVELOPER, the AUTHORITY shall compensate the DEVELOPER for the value of the completed portions of, and actual expenditures on the PROJECT plus a reasonable rate of return thereon, not exceeding that stated in the Cost Estimates of Items of Work previously approved by the SMDRP Executive Committee and the AUTHORITY and stated in this Agreement, as of the date of such revocation, cancellation, or termination, on a schedule to be agreed upon by the parties, provided that said completed portions of Phase I are in accordance with the approved FINAL REPORT.
Afterwards, President Ramos issued Proclamation
No. 465 dated
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the Philippines, by virtue of the powers vested in me by the law, and as recommended by the SMDRP Executive Committee, do hereby authorize the increase of the area of foreshore or submerged lands of Manila Bay to be reclaimed, as previously authorized under Proclamation No. 39 (s. 1992) and Memorandum Order No. 415 (s. 1992), from Four Hundred Thousand (400,000) square meters, more or less, to Seven Hundred Ninety Thousand (790,000) square meters, more or less.
On
In its
On
On
On
The
land reclamation was completed in August 1996.[37]
Sometime later in 1996, pursuant
likewise to Proclamation No. 39, the DENR issued Special Patent No. 3598
conveying in favor of NHA an additional 390,000 square meter area.
During the actual construction and
implementation of Phase I of the SMDRP, the Inter-Agency Technical Committee
found and recommended to the EXECOM on
Such necessary works comprised more
than 25% of the original contract price and as a result, the Asset Pool
incurred direct and indirect costs. Based
on C1 12 A of the Implementing Rules and Regulations of PD 1594, a supplemental
agreement is required for “all change orders and extra work orders, the total
aggregate cost of which being more than twenty-five (25%) of the escalated
original contract price.”
The EXECOM requested an opinion from
the Department of Justice (DOJ) to determine whether a bidding was required for
the change orders and/or necessary works.
The DOJ, through DOJ Opinion Nos. 119 and 155 dated August 26, 1993 and
November 12, 1993, opined that “a rebidding, pursuant to the aforequoted
provisions of the implementing rules (referring to PD 1594) would not be
necessary where the change orders inseparable from the original scope of the
project, in which case, a negotiation with the incumbent contractor may be
allowed.”
Thus, on
On
Outgoing President Ramos decided to
endorse the consideration of the Supplemental Agreement to incoming President
Joseph E. Estrada. On
However, the approval of the
Supplemental Agreement was unacted upon for five months. As a result, the utilities and the road
networks were constructed to cover only the 79-hectare original enabling component
granted under the ARJVA. The 220-hectare
extension of the 79-hectare area was no longer technically feasible. Moreover, the financial crises and unreliable
real estate situation made it difficult to sell the remaining reclaimed
lots. The devaluation of the peso and
the increase in interest cost led to the substantial increase in the cost of
reclamation.
On August 1, 1998, the NHA granted
RBI’s request to suspend work on the SMDRP due to “the delay in the approval of
the Supplemental Agreement, the consequent absence of an enabling component to
cover the cost of the necessary works for the project, and the resulting
inability to replenish the Asset Pool funds partially used for the completion
of the necessary works.”[39]
As of
Repeated demands were made by RBI in
its own capacity and on behalf of the asset pool on NHA for payment for the
advances for direct and indirect costs subject to NHA validation.
In November 1998, President Estrada
issued Memorandum Order No. 33 reconstituting the SMDRP EXECOM and further
directed it to review the Supplemental Agreement and submit its recommendation
on the completion of the SMDRP.
The reconstituted EXECOM conducted a
review of the project and recommended the amendment of the March 20, 1998
Supplemental Agreement “to make it more feasible and to identify and provide
new sources of funds for the project and provide for a new enabling component
to cover the payment for the necessary works that cannot be covered by the
79-hectare enabling component under the ARJVA.”[41]
The EXECOM passed Resolution Nos.
99-16-01 and 99-16-02[42]
which approved the modification of the Supplemental Agreement, to wit:
a) Approval of 150 hectares additional
reclamation in order to make the
reclamation feasible as part of the enabling component.
b) The conveyance of the 15-hectare NHA
Vitas property (actually 17
hectares based on surveys) to the SMDRP Asset Pool.
c) The inclusion in the total development
cost of other additional, necessary and
indispensable infrastructure works and the revision
of the original cost stated in the Supplemental Agreement dated
d) Revision in the sharing agreement between the parties.
In the March 23, 2000 OP Memorandum,
the EXECOM was authorized to proceed and complete the SMDRP subject to certain
guidelines and directives.
After the parties in the case at bar
had complied with the March 23, 2000 Memorandum, the NHA November 9, 2000
Resolution No. 4323 approved “the conveyance of the 17-hectare Vitas property
in favor of the existing or a newly created Asset Pool of the project to be
developed into a mixed commercial-industrial area, subject to certain
conditions.”
On
As of February 28, 2001, “the
estimated total project cost of the SMDRP has reached P8.65 billion comprising
of P4.78 billion in direct cost and P3.87 billion in indirect cost,”[43]
subject to validation by the NHA.
On August 28, 2001, NHA issued
Resolution No. 4436 to pay for “the various necessary works/change orders to
SMDRP, to effect the corresponding enabling component consisting of the
conveyance of the NHA’s Vitas Property and an additional 150-hectare
reclamation area” and to authorize the release by NHA of PhP 480 million “as
advance to the project to make the Permanent Housing habitable, subject to
reimbursement from the proceeds of the expanded enabling component.”[44]
On
In the
In its
Consequently, the parties negotiated
the terms of the termination of the JVA and other subsequent agreements.
On
1. TERMINATION
1.1 In compliance with the Cabinet directive
dated
a. Joint Venture Agreement (JVA) dated
b. Amended and Restated Joint Venture
Agreement (ARJVA) dated
c. Amendment and Restated Joint Venture
Agreement dated
d. Supplemental Agreement dated
e. Amended Supplemental Agreement (ASA)
dated
x x x x
5. SETTLEMENT OF CLAIMS
5.1 Subject to the validation of the DEVELOPER’s claims, the NHA hereby agrees to initially compensate the Developer for the abovementioned costs as follows:
a. Direct payment to DEVELOPER of the amounts herein listed in the following manner:
a.1 P250 Million in cash from the escrow account in accordance with Section 2 herewith;
a.2 Conveyance of a 3 hectare portion of the Vitas Industrial area immediately after joint determination of the appraised value of the said property in accordance with the procedure herein set forth in the last paragraph of Section 5.3. For purposes of all payments to be made through conveyance of real properties, the parties shall secure from the NHA Board of Directors all documents necessary and sufficient to effect the transfer of title over the properties to be conveyed to RBI, which documents shall be issued within a reasonable period.
5.2 Any unpaid balance of the DEVELOPERS claims determined after the validation process referred to in Section 4 hereof, may be paid in cash, bonds or through the conveyance of properties or any combination thereof. The manner, terms and conditions of payment of the balance shall be specified and agreed upon later within a period of three months from the time a substantial amount representing the unpaid balance has been validated pursuant hereto including, but not limited to the programming of quarterly cash payments to be sourced by the NHA from its budget for debt servicing, from its income or from any other sources.
5.3 In any case the unpaid balance is agreed to be paid, either partially or totally through conveyance of properties, the parties shall agree on which properties shall be subject to conveyance. The NHA and DEVELOPER hereby agree to determine the valuation of the properties to be conveyed by getting the average of the appraisals to be made by two (2) mutually acceptable independent appraisers.
Meanwhile, respondent Harbour Centre Port Terminal, Inc.
(HCPTI) entered into an agreement with the asset pool for the development and
operations of a port in the Smokey Mountain Area which is a major component of
SMDRP to provide a source of livelihood and employment for
Due
to HCPTI’s failure to obtain a license to handle foreign containerized cargo
from PPA, it suffered a net income loss of PhP 132,621,548 in 2002 and a net
loss of PhP 15,540,063 in 2003. The
Project Governing Board of the Asset Pool later conveyed by way of dacion en pago a number of HCPTI shares
to RBI in lieu of cash payment for the latter’s work in SMDRP.
On
The
NHA reported that thirty-four (34) temporary housing structures and twenty-one
(21) permanent housing structures had been turned over by respondent RBI. It claimed that 2,510 beneficiary-families
belonging to the poorest of the poor had been transferred to their permanent
homes and benefited from the Project.
The Issues
The
grounds presented in the instant petition are:
I
Neither respondent NHA nor respondent R-II
builders may validly reclaim foreshore and submerged land because:
1. Respondent
NHA and R-II builders were never granted
any power and authority to reclaim lands
of the public domain as this power is vested
exclusively with the PEA.
2. Even
assuming that respondents NHA and R-II builders
were given the power and authority to
reclaim foreshore and submerged land, they
were never given the authority by the denr
to do so.
II
Respondent R-II builders cannot acquire the
reclaimed foreshore and submerged land areas because:
1. The
reclaimed foreshore and submerged parcels
of land are inalienable public lands which
are beyond the commerce of man.
2. Assuming
arguendo that the subject reclaimed foreshore
and submerged parcels of land were already declared alienable lands of the
public domain, respondent R-II builders still could not acquire the same because
there was never any declaration that the said lands were no longer needed for
public use.
3. Even
assuming that the subject reclaimed lands
are alienable and no longer needed for
public use, respondent R-II builders still cannot
acquire the same because there was never
any law authorizing the sale thereof.
4. There
was never any public bidding awarding ownership
of the
5. Assuming
that all the requirements for a valid transfer of alienable public had been
performed, respondent R-II Builders, being private corporation is nonetheless expresslyprohibited
by the Philippine Constitution to acquire lands of the public domain.
III
IV
Respondents must be compelled to disclose all
information related to the smokey mountain development and reclamation project.
The Court’s Ruling
Before
we delve into the substantive issues raised in this petition, we will first
deal with several procedural matters raised by respondents.
Whether petitioner has the requisite locus standi to file this case
Respondents
argue that petitioner Chavez has no legal standing to file the petition.
Only a person who stands to be
benefited or injured by the judgment in the suit or entitled to the avails of
the suit can file a complaint or petition.[47] Respondents claim that petitioner is not a
proper party-in-interest as he was unable to show that “he has sustained or is
in immediate or imminent danger of sustaining some direct and personal injury
as a result of the execution and enforcement of the assailed contracts or
agreements.”[48] Moreover, they assert that not all government
contracts can justify a taxpayer’s suit especially when no public funds were
utilized in contravention of the Constitution or a law.
We explicated in Chavez v. PCGG[49]
that in cases where issues of transcendental public importance are presented,
there is no necessity to show that petitioner has experienced or is in actual
danger of suffering direct and personal injury as the requisite injury is
assumed. We find our ruling in Chavez v. PEA[50]
as conclusive authority on locus standi
in the case at bar since the issues raised in this petition are averred to be
in breach of the fair diffusion of the country’s natural resources and the
constitutional right of a citizen to information which have been declared to be
matters of transcendental public importance.
Moreover, the pleadings especially those of respondents readily reveal
that public funds have been indirectly utilized in the Project by means of Smokey
Mountain Project Participation Certificates (SMPPCs) bought by some government
agencies.
Hence,
petitioner, as a taxpayer, is a proper party to the instant petition before the
court.
Whether petitioner’s direct recourse to this Court was proper
Respondents
are one in asserting that petitioner circumvents the principle of hierarchy of
courts in his petition. Judicial
hierarchy was made clear in the case of People
v. Cuaresma, thus:
There is after all a hierarchy of courts. That hierarchy is determinative of the venue of appeals, and should also serve as a general determinant of the appropriate forum for petitions for the extraordinary writs. A becoming regard for that judicial hierarchy most certainly indicates that petitions for the issuance of extraordinary writs against first level (“inferior”) courts should be filed with the Regional Trial Court, and those against the latter, with the Court of Appeals. A direct invocation of the Supreme Court’s original jurisdiction to issue these writs should be allowed only when there are special and important reasons therefor, clearly and specifically set out in the petition. This is established policy. It is a policy that is necessary to prevent inordinate demands upon the Court’s time and attention which are better devoted to those matters within its exclusive jurisdiction, and to prevent further over-crowding of the Court’s docket.[51] x x x
The OSG claims that the jurisdiction
over petitions for prohibition and mandamus is concurrent with other lower
courts like the Regional Trial Courts and the Court of Appeals. Respondent NHA argues that the instant
petition is misfiled because it does not introduce special and important
reasons or exceptional and compelling circumstances to warrant direct recourse
to this Court and that the lower courts are more equipped for factual issues
since this Court is not a trier of facts.
Respondents RBI and RHI question the filing of the petition as this
Court should not be unduly burdened with “repetitions, invocation of
jurisdiction over constitutional questions it had previously resolved and
settled.”
In
the light of existing jurisprudence, we find paucity of merit in respondents’
postulation.
While
direct recourse to this Court is generally frowned upon and discouraged, we
have however ruled in Santiago v. Vasquez
that such resort to us may be allowed in certain situations, wherein this Court
ruled that petitions for certiorari, prohibition, or mandamus, though
cognizable by other courts, may directly be filed with us if “the redress
desired cannot be obtained in the appropriate courts or where exceptional compelling
circumstances justify availment of a remedy within and calling for the exercise
of [this Court’s] primary jurisdiction.”[52]
The
instant petition challenges the constitutionality and legality of the SMDRP
involving several hectares of government land and hundreds of millions of funds
of several government agencies.
Moreover, serious constitutional challenges are made on the different
aspects of the Project which allegedly affect the right of Filipinos to the
distribution of natural resources in the country and the right to information
of a citizen—matters which have been considered to be of extraordinary significance
and grave consequence to the public in general.
These concerns in the instant action compel us to turn a blind eye to
the judicial structure meant to provide an orderly dispensation of justice and
consider the instant petition as a justified deviation from an established
precept.
Core factual matters undisputed
Respondents
next challenge the projected review by this Court of the alleged factual issues
intertwined in the issues propounded by petitioner. They listed a copious number of questions
seemingly factual in nature which would make this Court a trier of facts.[53]
We
find the position of respondents bereft of merit.
For
one, we already gave due course to the instant petition in our
Secondly,
we agree with petitioner that there is no necessity for us to make any factual
findings since the facts needed to decide the instant petition are well established
from the admissions of the parties in their pleadings[55]
and those derived from the documents appended to said submissions. Indeed, the core facts which are the subject
matter of the numerous issues raised in this petition are undisputed.
Now we will tackle the issues that
prop up the instant petition.
Since petitioner has cited our
decision in PEA as basis for his
postulations in a number of issues, we first resolve the query—is PEA applicable to the case at bar?
A
juxtaposition of the facts in the two cases constrains the Court to rule in the
negative.
The
Court finds that PEA is not a binding
precedent to the instant petition because the facts in said case are
substantially different from the facts and circumstances in the case at bar,
thus:
(1) The reclamation project in PEA was undertaken through a JVA entered
into between PEA and AMARI. The reclamation
project in the instant NHA case was undertaken by the NHA, a national
government agency in consultation with PEA and with the approval of two
Philippine Presidents;
(2) In PEA,
AMARI and PEA executed a JVA to develop the
(3) In PEA,
there was no law or presidential proclamation classifying the lands to be
reclaimed as alienable and disposal lands of public domain. In this RBI case, MO 415 of former President
Aquino and Proclamation No. 39 of then President Ramos, coupled with Special
Patents Nos. 3591, 3592, and 3598, classified the reclaimed lands as alienable
and disposable;
(4) In PEA,
the Chavez petition was filed before the amended JVA was executed by PEA and
AMARI. In this NHA case, the JVA and subsequent amendments were already
substantially implemented. Subsequently,
the Project was terminated through a MOA signed on
(5) In PEA,
AMARI was considered to be in bad faith as it signed the amended JVA after the
Chavez petition was filed with the Court and after Senate Committee Report No.
560 was issued finding that the subject lands are inalienable lands of public
domain. In the instant petition, RBI and
other respondents are considered to have signed the agreements in good faith as
the Project was terminated even before the Chavez petition was filed;
(6) The PEA-AMARI JVA was executed as a result
of direct negotiation between the parties and not in accordance with the BOT
Law. The NHA-RBI JVA and subsequent
amendments constitute a BOT contract governed by the BOT Law; and
(7) In PEA,
the lands to be reclaimed or already reclaimed were transferred to PEA, a
government entity tasked to dispose of public lands under Executive Order No. (EO)
525.[56] In the NHA case, the reclaimed lands were
transferred to NHA, a government entity NOT tasked to dispose of public land
and therefore said alienable lands were converted to patrimonial lands upon their
transfer to NHA.[57]
Thus the PEA Decision[58]
cannot be considered an authority or precedent to the instant case. The principle of stare decisis[59]
has no application to the different factual setting of the instant case.
We will now dwell on the substantive
issues raised by petitioner. After a
perusal of the grounds raised in this petition, we find that most of these
issues are moored on our PEA Decision
which, as earlier discussed, has no application to the instant petition. For this reason alone, the petition can
already be rejected. Nevertheless, on
the premise of the applicability of said decision to the case at bar, we will
proceed to resolve said issues.
First Issue:
Whether respondents NHA and RBI have been granted
the power and authority to reclaim lands of the public
domain as
this power is vested exclusively in PEA as claimed by
petitioner
Petitioner
contends that neither respondent NHA nor respondent RBI may validly reclaim
foreshore and submerged land because they were not given any power and
authority to reclaim lands of the public domain as this power was delegated by
law to PEA.
Asserting
that existing laws did not empower the NHA and RBI to reclaim lands of public
domain, the Public Estates Authority (PEA), petitioner claims, is “the primary
authority for the reclamation of all foreshore and submerged lands of public
domain,” and relies on PEA where this
Court held:
Moreover, Section 1 of Executive
Order No. 525 provides that PEA “shall be primarily responsible for
integrating, directing, and coordinating all reclamation projects for and on
behalf of the National Government.” The
same section also states that “[A]ll reclamation projects shall be approved by
the President upon recommendation of the PEA, and shall be undertaken by the
PEA or through a proper contract executed by it with any person or entity; x x
x.” Thus, under EO No. 525, in relation to PD No. 3-A and PD No. 1084, PEA
became the primary implementing agency of the National Government to reclaim
foreshore and submerged lands of the public domain. EO No. 525 recognized PEA as the government
entity “to undertake the reclamation of lands and ensure their maximum
utilization in
promoting public welfare and interests.” Since
large portions of these reclaimed lands would obviously be needed for public
service, there must be a formal declaration segregating reclaimed lands no
longer needed for public service from those still needed for public service.[60]
In the Smokey Mountain Project, petitioner
clarifies that the reclamation was not done by PEA or through a contract
executed by PEA with another person or entity but by the NHA through an
agreement with respondent RBI. Therefore,
he concludes that the reclamation is null and void.
Petitioner’s contention has no merit.
EO
525 reads:
Section 1. The Public Estates Authority (PEA) shall be primarily
responsible for integrating, directing, and coordinating all reclamation
projects for and on behalf of the National Government. All reclamation projects shall be approved by
the President upon recommendation of the PEA, and shall be undertaken by the
PEA or through a proper contract executed by it with any person or entity;
Provided, that, reclamation projects of
any national government agency or entity authorized under its charter shall be
undertaken in consultation with the PEA upon approval of the President. (Emphasis supplied.)
The
aforequoted provision points to three (3) requisites for a legal and valid
reclamation project, viz:
(1) approval by the President;
(2) favorable recommendation of PEA; and
(3) undertaken by any of the following:
a. by PEA
b. by any person or entity pursuant to a
contract it executed with PEA
c. by the National Government agency or
entity authorized under its charter to reclaim lands
subject to consultation with
PEA
Without
doubt, PEA under EO 525 was designated as the agency primarily responsible for
integrating, directing, and coordinating all reclamation projects. Primarily
means “mainly, principally, mostly, generally.” Thus,
not all reclamation projects fall under PEA’s authority of supervision,
integration, and coordination. The very
charter of PEA, PD 1084,[61]
does not mention that PEA has the exclusive and sole power and authority to
reclaim lands of public domain. EO 525
even reveals the exception—reclamation projects by a national government agency
or entity authorized by its charter to reclaim land. One example is EO 405 which authorized the
Philippine Ports Authority (PPA) to reclaim and develop submerged areas for
port related purposes. Under its
charter, PD 857, PPA has the power “to reclaim, excavate, enclose or raise any
of the lands” vested in it.
Thus,
while PEA under PD 1084 has the power to reclaim land and under EO 525 is primarily
responsible for integrating, directing and coordinating reclamation projects,
such authority is NOT exclusive and such power to reclaim may be granted or
delegated to another government agency or entity or may even be undertaken by
the National Government itself, PEA being only an agency and a part of the
National Government.
Let
us apply the legal parameters of Sec. 1, EO 525 to the reclamation phase of SMDRP. After a scrutiny of the facts culled from the
records, we find that the project met all the three (3) requirements, thus:
1. There was ample approval by the President
of the
For
his part, then President Ramos issued Proclamation No. 39 (s. 1992) which
expressly reserved the Smokey Mountain Area and the Reclamation Area for a housing project and related
commercial/industrial development.
Moreover, President Ramos issued
Proclamation No. 465 (s. 1994) which authorized the increase of the Reclamation Area from 40 hectares of foreshore and
submerged land of the
As
a result of Proclamations Nos. 39 and 465, Special Patent No. 3591 covering
211,975 square meters of
Thus,
the first requirement of presidential imprimatur on the SMDRP has been
satisfied.
2. The requisite favorable endorsement of
the reclamation phase was impliedly granted by PEA. President Aquino saw to it that there was
coordination of the project with PEA by designating its general manager as
member of the EXECOM tasked to supervise the project implementation. The assignment was made in Sec. 2 of MO 415
which provides:
Section 2. An Executive Committee is hereby created to oversee the implementation of the Plan, chaired by the NCR-CORD, with the heads of the following agencies as members: The National Housing Authority, the City of Manila, the Department of Public Works and Highways, the Public Estates Authority, the Philippine Ports Authority, the Department of Environment and Natural Resources and the Development Bank of the Philippines. (Emphasis supplied.)
The
favorable recommendation by PEA of the JVA and subsequent amendments were
incorporated as part of the recommendations of the EXECOM created under MO 415.
While there was no specific recommendation on the SMDRP emanating solely from
PEA, we find that the approbation of the Project and the land reclamation as an
essential component by the EXECOM of which PEA is a member, and its submission
of the SMDRP and the agreements on the Project to the President for approval
amply met the second requirement of EO 525.
3. The third element was also present—the
reclamation was undertaken either by PEA or any person or entity under contract
with PEA or by the National Government agency or entity authorized under its
charter to reclaim lands subject to consultation with PEA. It cannot be disputed that the reclamation
phase was not done by PEA or any person or entity under contract with PEA. However, the reclamation was implemented by
the NHA, a national government agency whose authority to reclaim lands under
consultation with PEA is derived from its charter—PD 727 and other pertinent
laws—RA 7279[62] and RA
6957 as amended by RA 7718.
While
the authority of NHA to reclaim lands is challenged by petitioner, we find that
the NHA had more than enough authority to do so under existing laws. While PD 757, the charter of NHA, does not
explicitly mention “reclamation” in any of the listed powers of the agency, we rule
that the NHA has an implied power to reclaim land as this is vital or incidental
to effectively, logically, and successfully implement an urban land reform and
housing program enunciated in Sec. 9 of Article XIII of the 1987 Constitution.
Basic
in administrative law is the doctrine that a government agency or office has
express and implied powers based on its charter and other pertinent statutes. Express powers are those powers granted,
allocated, and delegated to a government agency or office by express provisions
of law. On the other hand, implied
powers are those that can be inferred or are implicit in the wordings of the
law[63]
or conferred by necessary or fair implication in the enabling act.[64] In
The
power to reclaim on the part of the NHA is implicit from PD 757, RA 7279, MO
415, RA 6957, and PD 3-A,[67]
viz:
1. NHA’s
power to reclaim derived from PD 757 provisions:
a. Sec.
3 of PD 757 implies that reclamation may be resorted to in order to attain the
goals of NHA:
Section
3. Progress and Objectives. The
Authority shall have the following purposes and objectives:
x x x x
b) To undertake housing, development, resettlement or other activities as would enhance the provision of housing to every Filipino;
c) To harness and promote private participation in housing ventures in terms of capital expenditures, land, expertise, financing and other facilities for the sustained growth of the housing industry. (Emphasis supplied.)
Land
reclamation is an integral part of the development of resources for some of the
housing requirements of the NHA. Private
participation in housing projects may also take the form of land reclamation.
b. Sec.
5 of PD 757 serves as proof that the NHA, as successor of the Tondo Foreshore
Development Authority (TFDA), has the power to reclaim, thus:
Section 5. Dissolution of Existing Housing Agencies. The People's Homesite and Housing Corporation (PHHC), the Presidential Assistant on Housing Resettlement Agency (PAHRA), the Tondo Foreshore Development Authority (TFDA), the Central Institute for the Training and Relocation of Urban Squatters (CITRUS), the Presidential Committee for Housing and Urban Resettlement (PRECHUR), Sapang Palay Development Committee, Inter-Agency Task Force to Undertake the Relocation of Families in Barrio Nabacaan, Villanueva, Misamis Oriental and all other existing government housing and resettlement agencies, task forces and ad-hoc committees, are hereby dissolved. Their powers and functions, balance of appropriations, records, assets, rights, and choses in action, are transferred to, vested in, and assumed by the Authority. x x x (Emphasis supplied.)
PD 570 dated
Section 2. Objectives
and Purposes. The Authority shall
have the following purposes and objectives:
a) To undertake all manner of activity, business or development projects for the establishment of harmonious, comprehensive, integrated and healthy living community in the Tondo Foreshoreland and its resettlement site;
b) To undertake and promote the physical and socio-economic amelioration of the Tondo Foreshore residents in particular and the nation in general (Emphasis supplied.)
The
powers and functions are contained in Sec. 3, to wit:
a) To develop and implement
comprehensive and integrated urban renewal programs for the Tondo Foreshore and Dagat-dagatan
lagoon and/or any other
additional/alternative resettlement site and to formulate and enforce
general and specific policies for its development which shall ensure reasonable
degree of compliance with environmental standards.
b) To prescribe guidelines and
standards for the reservation, conservation and utilization of public lands covering the Tondo Foreshore land and its
resettlement sites;
c) To construct, acquire, own, lease, operate and maintain infrastructure facilities, housing complex, sites and services;
d) To determine, regulate and
supervise the establishment and operation of housing, sites, services and
commercial and industrial complexes and any other enterprises to be constructed
or established within the Tondo
Foreshore and its resettlement sites;
e) To undertake and develop, by
itself or through joint ventures with other public or private entities, all or
any of the different phases of development of the Tondo Foreshore land and its resettlement sites;
f) To acquire and own property, property-rights and interests, and encumber or otherwise dispose of the same as it may deem appropriate (Emphasis supplied.)
From
the foregoing provisions, it is readily apparent that the TFDA has the explicit
power to develop public lands covering the Tondo foreshore land and any other
additional and alternative resettlement sites under letter b, Sec. 3 of PD
570. Since the additional and/or
alternative sites adjacent to Tondo foreshore land cover foreshore and
submerged areas, the reclamation of said areas is necessary in order to convert
them into a comprehensive and integrated resettlement housing project for the
slum dwellers and squatters of Tondo.
Since the powers of TFDA were assumed by the NHA, then the NHA has the
power to reclaim lands in the Tondo foreshore area which covers the 79-hectare
land subject of Proclamations Nos. 39 and 465 and Special Patents Nos. 3592 and
3598.
c. Sec. 6 of PD 757 delineates the functions
and powers of the NHA which embrace the authority to reclaim land, thus:
Sec.
6. Powers
and functions of the Authority.—The Authority shall have the following
powers and functions to be exercised by the Board in accordance with its
established national human settlements plan prepared by the Human Settlements
Commission:
(a) Develop
and implement the comprehensive and
integrated housing program provided for in Section hereof;
x x x x
(c) Prescribe guidelines and standards for the reservation, conservation and utilization of public lands identified for housing and resettlement;
x x x x
(e) Develop and undertake housing development and/or resettlement projects through joint ventures or other arrangements with public and private entities;
x x x x
(k) Enter
into contracts whenever necessary under such terms and conditions as it may
deem proper and reasonable;
(l) Acquire property rights and interests
and encumber or otherwise dispose the same as it may deem appropriate;
x x x x
(s) Perform such other acts not inconsistent
with this Decree, as may be necessary to effect the policies and objectives
herein declared. (Emphasis
supplied.)
The NHA’s authority to reclaim land
can be inferred from the aforequoted provisions. It can make use of public lands under letter
(c) of Sec. 6 which includes reclaimed land as site for its comprehensive and
integrated housing projects under letter (a) which can be undertaken through
joint ventures with private entities under letter (e). Taken together with letter (s) which
authorizes NHA to perform such other activities “necessary to effect the
policies and objectives” of PD 757, it is safe to conclude that the NHA’s power
to reclaim lands is a power that is implied from the exercise of its explicit
powers under Sec. 6 in order to effectively accomplish its policies and
objectives under Sec. 3 of its charter.
Thus, the reclamation of land is an indispensable component for the
development and construction of the SMDRP housing facilities.
2. NHA’s
implied power to reclaim land is enhanced by RA 7279.
PD
757 identifies NHA’s mandate to “[d]evelop and undertake housing development
and/or resettlement projects through joint ventures or other arrangements with
public and private entities.”
The
power of the NHA to undertake reclamation of land can be inferred from Secs. 12
and 29 of RA 7279, which provide:
Section 12. Disposition of Lands for Socialized Housing.—The National Housing Authority, with respect to lands belonging to the National Government, and the local government units with respect to other lands within their respective localities, shall coordinate with each other to formulate and make available various alternative schemes for the disposition of lands to the beneficiaries of the Program. These schemes shall not be limited to those involving transfer of ownership in fee simple but shall include lease, with option to purchase, usufruct or such other variations as the local government units or the National Housing Authority may deem most expedient in carrying out the purposes of this Act.
x x x x
Section 29. Resettlement.—With two (2) years from the effectivity of this Act, the local government units, in coordination with the National Housing Authority, shall implement the relocation and resettlement of persons living in danger areas such as esteros, railroad tracks, garbage dumps, riverbanks, shorelines, waterways, and in other public places as sidewalks, roads, parks, and playgrounds. The local government unit, in coordination with the National Housing Authority, shall provide relocation or resettlement sites with basic services and facilities and access to employment and livelihood opportunities sufficient to meet the basic needs of the affected families. (Emphasis supplied.)
Lands
belonging to the National Government include foreshore and submerged lands
which can be reclaimed to undertake housing development and resettlement
projects.
3. MO
415 explains the undertaking of the NHA in SMDRP:
WHEREAS,
Memorandum Order No. 161-A mandated the National Housing Authority to conduct
feasibility studies and develop low-cost
housing projects at the dumpsites of Metro Manila;
WHEREAS, the National Housing Authority has presented a viable Conceptual Plan to convert the Smokey Mountain dumpsite into a habitable housing project inclusive of the reclamation area across R-10 as enabling component of the Project;
WHEREAS, the said Plan requires the
coordinated and synchronized efforts of the City of
WHEREAS, the government encourages private sector initiative in the implementation of its projects. (Emphasis supplied.)
Proceeding from these “whereas”
clauses, it is unequivocal that reclamation of land in the
4. RA
6957 as amended by RA 7718—the BOT Law—serves as an exception to PD 1084 and EO
525.
Based on the provisions of the BOT Law
and Implementing Rules and Regulations, it is unequivocal that all government
infrastructure agencies like the NHA can undertake infrastructure or
development projects using the contractual arrangements prescribed by the law,
and land reclamation is one of the projects that can be resorted to in the BOT project
implementation under the February 10, 1992 Joint Resolution No. 3 of the 8th
Congress.
From
the foregoing considerations, we find that the NHA has ample implied authority
to undertake reclamation projects.
Even
without an implied power to reclaim lands under NHA’s charter, we rule that the
authority granted to NHA, a national government agency, by the President under PD
3-A reinforced by EO 525 is more than sufficient statutory basis for the
reclamation of lands under the SMDRP.
PD
3-A is a law issued by then President Ferdinand E. Marcos under his martial law
powers on
Subsequently,
on
On
The
power of the National Government through the President over reclamation of
areas, that is, underwater whether foreshore or inland, was made clear in EO
543[69]
which took effect on June 24, 2006.
Under EO 543, PEA was renamed the Philippine Reclamation Authority (PRA)
and was granted the authority to approve reclamation projects, a power
previously reposed in the President under EO 525. EO 543 reads:
Section
1. The
power of the President to approve reclamation projects is hereby delegated to
the Philippine Reclamation Authority [formerly PEA], through its governing
board, subject to compliance with existing laws and rules and subject to the
condition that reclamation contracts to be executed with any person or entity
go through public bidding.
Section 2. Nothing
in the Order shall be construed as diminishing the President’s authority to
modify, amend or nullify PRA’s action.
Section 3. All executive issuances inconsistent with this Executive Order are hereby repealed or amended accordingly. (Emphasis supplied.)
Sec. 2 of EO 543 strengthened the
power of control and supervision of the President over reclamation of lands as
s/he can modify, amend, or nullify the action of PEA (now PRA).
From the foregoing issuances, we
conclude that the President’s delegation to NHA, a national government agency,
to reclaim lands under the SMDRP, is legal and valid, firmly anchored on PD 3-A
buttressed by EO 525 notwithstanding the absence of any specific grant of power
under its charter, PD 757.
Second Issue:
Whether respondents NHA and RBI were given the
power and authority by DENR to reclaim foreshore and
submerged
lands
Petitioner
Chavez puts forth the view that even if the NHA and RBI were granted the
authority to reclaim, they were not authorized to do so by the DENR.
Again, reliance is made on our ruling
in PEA where it was held that the DENR’s
authority is necessary in order for the government to validly reclaim foreshore
and submerged lands. In PEA, we expounded in this manner:
As manager, conservator and overseer
of the natural resources of the State, DENR exercises “supervision and control
over alienable and disposable public lands.”
DENR also exercises “exclusive jurisdiction on the management and
disposition of all lands of the public domain.”
Thus, DENR decides whether areas under water, like foreshore or
submerged areas of
DENR also exercises exclusive
jurisdiction over the disposition of all lands of the public domain. Hence, DENR decides whether reclaimed lands
of PEA should be classified as alienable under Sections 6 and 7 of CA No.
141. Once DENR decides that the
reclaimed lands should be so classified, it then recommends to the President
the issuance of a proclamation classifying the lands as alienable or disposable
lands of the public domain open to disposition.
We note that then DENR Secretary Fulgencio S. Factoran, Jr.
countersigned Special Patent No. 3517 in compliance with the Revised Administrative
Code and Sections 6 and 7 of CA No. 141.
In short,
DENR is vested with the power to authorize the reclamation of areas under
water, while PEA is vested with the power to undertake the physical reclamation
of areas under water, whether directly or through private contractors. DENR is also empowered to classify lands of
the public domain into alienable or disposable lands subject to the approval of
the President. On the other hand, PEA is
tasked to develop, sell or lease the reclaimed alienable lands of the public
domain.[70]
Despite our finding that PEA is not a precedent to the case at
bar, we find after all that under existing laws, the NHA is still required to
procure DENR’s authorization before a reclamation project in Manila Bay or in
any part of the
Notwithstanding the need for DENR
permission, we nevertheless find petitioner’s position bereft of merit.
The
DENR is deemed to have granted the authority to reclaim in the Smokey Mountain
Project for the following reasons:
1. Sec. 17, Art. VII of the Constitution
provides that “the President shall have control of all executive departments,
bureaus and offices.” The President is
assigned the task of seeing to it that all laws are faithfully executed. “Control,” in administrative law, means “the
power of an officer to alter, modify, nullify or set aside what a subordinate
officer has done in the performance of his duties and to substitute the
judgment of the former for that of the latter.”[71]
As
such, the President can exercise executive power motu proprio and can supplant the act or decision of a subordinate
with the President’s own. The DENR is a
department in the executive branch under the President, and it is only an alter
ego of the latter. Ordinarily the
proposed action and the staff work are initially done by a department like the
DENR and then submitted to the President for approval. However, there is nothing infirm or unconstitutional
if the President decides on the implementation of a certain project or activity
and requires said department to implement it.
Such is a presidential prerogative as long as it involves the department
or office authorized by law to supervise or execute the Project. Thus, as in this case, when the President
approved and ordered the development of a housing project with the
corresponding reclamation work, making DENR a member of the committee tasked to
implement the project, the required authorization from the DENR to reclaim land
can be deemed satisfied. It cannot be
disputed that the ultimate power over alienable and disposable public lands is
reposed in the President of the
In Chavez v. Romulo, we stated that when a statute imposes a specific
duty on the executive department, the President may act directly or order the
said department to undertake an activity, thus:
[A]t the apex of the entire executive officialdom is the President. Section 17, Article VII of the Constitution specifies [her] power as Chief executive departments, bureaus and offices. [She] shall ensure that the laws be faithfully executed. As Chief Executive, President Arroyo holds the steering wheel that controls the course of her government. She lays down policies in the execution of her plans and programs. Whatever policy she chooses, she has her subordinates to implement them. In short, she has the power of control. Whenever a specific function is entrusted by law or regulation to her subordinate, she may act directly or merely direct the performance of a duty x x x. Such act is well within the prerogative of her office (emphasis supplied).[72]
Moreover,
the power to order the reclamation of lands of public domain is reposed first in
the Philippine President. The Revised Administrative Code of 1987 grants
authority to the President to reserve lands of public domain for settlement for
any specific purpose, thus:
Section 14. Power to Reserve Lands of the Public and Private Domain of the Government.—(1) 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. (Emphasis supplied.)
President Aquino reserved the area of
the
2.
Under Sec. 2 of MO 415, the DENR is
one of the members of the EXECOM chaired by the NCR-CORD to oversee the
implementation of the Project. The EXECOM
was the one which recommended approval of the project plan and the joint
venture agreements. Clearly, the DENR
retained its power of supervision and control over the laws affected by the Project
since it was tasked to “facilitate the titling of the
3. Former DENR Secretary Angel C. Alcala
issued Special Patents Nos. 3591 and 3592 while then Secretary Victor O. Ramos
issued Special Patent No. 3598 that embraced the areas covered by the
reclamation. These patents conveyed the lands
to be reclaimed to the NHA and granted to said agency the administration and
disposition of said lands for subdivision and disposition to qualified
beneficiaries and for development for mix land use (commercial/industrial) “to
provide employment opportunities to on-site families and additional areas for
port related activities.” Such grant of
authority to administer and dispose of lands of public domain under the SMDRP
is of course subject to the powers of the EXECOM of SMDRP, of which the DENR is
a member.
4. The issuance of ECCs by the DENR for
SMDRP is but an exercise of its power of supervision and control over the lands
of public domain covered by the Project.
Based
on these reasons, it is clear that the DENR, through its acts and issuances, has
ratified and confirmed the reclamation of the subject lands for the purposes
laid down in Proclamations Nos. 39 and 465.
Third Issue:
Whether respondent RBI can acquire reclaimed
foreshore and submerged lands considered as
inalienable and
outside the commerce of man
Petitioner
postulates that respondent RBI cannot acquire the reclaimed foreshore and
submerged areas as these are inalienable public lands beyond the commerce of
man based on Art. 1409 of the Civil Code which provides:
Article 1409. The following contracts are inexistent and void from the beginning:
(1) Those
whose cause, object or purpose is contrary to law, morals, good customs, public
order or public policy;
x x x x
(7) Those
expressly prohibited or declared void by law.
These contracts cannot be ratified. Neither can the right to set up the defense of illegality be waived.
Secs.
2 and 3, Art. XII of the Constitution declare that all natural resources are
owned by the State and they cannot be alienated except for alienable
agricultural lands of the public domain.
One of the State’s natural resources are lands of public domain which
include reclaimed lands.
Petitioner contends that for these
reclaimed lands to be alienable, there must be a law or presidential
proclamation officially classifying these reclaimed lands as alienable and
disposable and open to disposition or concession. Absent such law or proclamation, the
reclaimed lands cannot be the enabling component or consideration to be paid to
RBI as these are beyond the commerce of man.
We
are not convinced of petitioner’s postulation.
The
reclaimed lands across R-10 were classified alienable and disposable lands of
public domain of the State for the following reasons, viz:
First,
there were three (3) presidential proclamations classifying the reclaimed lands
across R-10 as alienable or disposable hence open to disposition or concession,
to wit:
(1) MO 415 issued by President Aquino, of which
Sec. 4 states that “[t]he land covered by the Smokey Mountain Dumpsite is
hereby conveyed to the National Housing Authority as well as the area to be
reclaimed across R-10.”
The
directive to transfer the lands once reclaimed to the NHA implicitly carries
with it the declaration that said lands are alienable and disposable. Otherwise, the NHA cannot effectively use them
in its housing and resettlement project.
(2) Proclamation No. 39 issued by then
President Ramos by which the reclaimed lands were conveyed to NHA for
subdivision and disposition to qualified beneficiaries and for development into
a mixed land use (commercial/industrial) to provide employment opportunities to
on-site families and additional areas for port-related activities. Said directive carries with it the
pronouncement that said lands have been transformed to alienable and disposable
lands. Otherwise, there is no legal way
to convey it to the beneficiaries.
(3) Proclamation No. 465 likewise issued by President
Ramos enlarged the reclaimed area to 79 hectares to be developed and disposed of
in the implementation of the SMDRP. The
authority put into the hands of the NHA to dispose of the reclaimed lands
tacitly sustains the conversion to alienable and disposable lands.
Secondly,
Special Patents Nos. 3591, 3592, and 3598 issued by the DENR anchored on
Proclamations Nos. 39 and 465 issued by President Ramos, without doubt, classified
the reclaimed areas as alienable and disposable.
Admittedly,
it cannot be said that MO 415, Proclamations Nos. 39 and 465 are explicit
declarations that the lands to be reclaimed are classified as alienable and
disposable. We find however that such
conclusion is derived and implicit from the authority given to the NHA to transfer
the reclaimed lands to qualified beneficiaries.
The
query is, when did the declaration take effect? It did so only after the
special patents covering the reclaimed areas were issued. It is only on such date that the reclaimed
lands became alienable and disposable lands of the public domain. This is in line with the ruling in PEA where said issue was clarified and
stressed:
PD No. 1085, coupled with President
Aquino’s actual issuance of a special
patent covering the Freedom Islands, is equivalent to an official proclamation
classifying the
Thus, MO 415 and Proclamations Nos. 39
and 465 cumulatively and jointly taken together with Special Patent Nos. 3591,
3592, and 3598 more than satisfy the requirement in PEA that “[t]here must be a law or presidential proclamation officially classifying these reclaimed
lands as alienable or disposable and open to disposition or concession
(emphasis supplied).”[74]
Apropos
the requisite law categorizing reclaimed land as alienable or disposable, we
find that RA 6957 as amended by RA 7718 provides ample authority for the
classification of reclaimed land in the SMDRP for the repayment scheme of the
BOT project as alienable and disposable lands of public domain. Sec. 6 of RA 6957 as amended by RA 7718
provides:
For the financing, construction, operation and maintenance of any infrastructure projects undertaken through the build-operate-and transfer arrangement or any of its variations pursuant to the provisions of this Act, the project proponent x x x may likewise be repaid in the form of a share in the revenue of the project or other non-monetary payments, such as, but not limited to, the grant of a portion or percentage of the reclaimed land, subject to the constitutional requirements with respect to the ownership of the land. (Emphasis supplied.)
While
RA 6957 as modified by RA 7718 does not expressly declare that the reclaimed
lands that shall serve as payment to the project proponent have become
alienable and disposable lands and opened for disposition; nonetheless, this
conclusion is necessarily implied, for how else can the land be used as the enabling
component for the Project if such classification is not deemed made?
It
may be argued that the grant of authority to sell public lands, pursuant to PEA, does not convert alienable lands of
public domain into private or patrimonial lands. We ruled in PEA that “alienable lands of
public domain must be transferred to qualified private parties, or to
government entities not tasked to dispose of public lands, before these lands
can become private or patrimonial lands (emphasis supplied).”[75] To lands reclaimed by PEA or through a
contract with a private person or entity, such reclaimed lands still remain alienable
lands of public domain which can be transferred only to Filipino citizens but
not to a private corporation. This is
because PEA under PD 1084 and EO 525 is tasked to hold and dispose of alienable
lands of public domain and it is only when it is transferred to Filipino
citizens that it becomes patrimonial property.
On the other hand, the NHA is a government agency not tasked to dispose of public lands under its charter—The Revised
Administrative Code of 1987. The NHA is
an “end-user agency” authorized by law to administer and dispose of reclaimed
lands. The moment titles over reclaimed
lands based on the special patents are transferred to the NHA by the Register
of Deeds, they are automatically converted to patrimonial properties of the
State which can be sold to Filipino citizens and private corporations, 60% of
which are owned by Filipinos. The reason
is obvious: if the reclaimed land is not
converted to patrimonial land once transferred to NHA, then it would be useless
to transfer it to the NHA since it cannot legally transfer or alienate lands of
public domain. More importantly, it
cannot attain its avowed purposes and goals since it can only transfer
patrimonial lands to qualified beneficiaries and prospective buyers to raise
funds for the SMDRP.
From
the foregoing considerations, we find that the 79-hectare reclaimed land has
been declared alienable and disposable land of the public domain; and in the
hands of NHA, it has been reclassified as patrimonial property.
Petitioner,
however, contends that the reclaimed lands were inexistent prior to the three (3)
Presidential Acts (MO 415 and Proclamations Nos. 39 and 465) and hence, the
declaration that such areas are alienable and disposable land of the public
domain, citing PEA, has no legal
basis.
Petitioner’s contention is not well-taken.
Petitioner’s
sole reliance on Proclamations Nos. 39 and 465 without taking into consideration
the special patents issued by the DENR demonstrates the inherent weakness of
his proposition. As was ruled in PEA cited by petitioner himself, “PD No.
1085, coupled with President Aquino’s actual issuance of a special patent
covering the
The reclaimed lands covered by Special
Patents Nos. 3591, 3592, and 3598, which evidence transfer of ownership of
reclaimed lands to the NHA, are official acts of the DENR Secretary in the
exercise of his power of supervision and control over alienable and disposable
public lands and his exclusive jurisdiction over the management and disposition
of all lands of public domain under the Revised Administrative Code of
1987. Special Patent No. 3592 speaks of
the transfer of Lots 1 and 2, and RI-003901-000012-D with an area of 401,485
square meters based on the survey and technical description approved by the Bureau
of Lands. Lastly, Special Patent No.
3598 was issued in favor of the NHA transferring to said agency a tract of land
described in Plan RL-00-000013 with an area of 390,000 square meters based on
the survey and technical descriptions approved by the Bureau of Lands.
The
conduct of the survey, the preparation of the survey plan, the computation of
the technical description, and the processing and preparation of the special
patent are matters within the technical area of expertise of administrative
agencies like the DENR and the Land Management Bureau and are generally
accorded not only respect but at times even finality.[76] Preparation of special patents calls for
technical examination and a specialized review of calculations and specific
details which the courts are ill-equipped to undertake; hence, the latter defer
to the administrative agency which is trained and knowledgeable on such
matters.[77]
Subsequently,
the special patents in the name of the NHA were submitted to the Register of
Deeds of the City of
As
early as 1999, this Court in Baguio v.
Republic laid down the jurisprudence that:
It is true that, once a patent is registered and the corresponding certificate of title is issued, the land covered by them ceases to be part of the public domain and becomes private property, and the Torrens Title issued pursuant to the patent becomes indefeasible upon the expiration of one year from the date of issuance of such patent.[78]
The
doctrine was reiterated in Republic v.
Heirs of Felipe Alijaga, Sr.,[79] Heirs of Carlos Alcaraz v. Republic,[80]
and the more recent case of Doris
Chiongbian-Oliva v. Republic of the
One
last point. The ruling in PEA cannot even
be applied retroactively to the lots covered by Special Patents Nos. 3592 (40
hectare reclaimed land) and 3598 (39-hectare reclaimed land). The reclamation of the land under SMDRP was
completed in August 1996 while the PEA decision
was rendered on
In
Benzonan v. Court of Appeals, the
Court trenchantly elucidated the prospective application of its decisions based
on considerations of equity and fair play, thus:
At
that time, the prevailing jurisprudence interpreting section 119 of R.A. 141 as
amended was that enunciated in Monge and Tupas cited above. The petitioners Benzonan and respondent Pe
and the DBP are bound by these decisions for pursuant to Article 8 of the Civil
Code “judicial decisions applying or interpreting the laws of the Constitution
shall form a part of the legal system of the
The same consideration underlies our rulings giving only prospective effect to decisions enunciating new doctrines. Thus, we emphasized in People v. Jabinal, 55 SCRA 607 [1974] “x x x when a doctrine of this Court is overruled and a different view is adopted, the new doctrine should be applied prospectively and should not apply to parties who had relied on the old doctrine and acted on the faith thereof.[82]
Fourth Issue:
Whether respondent RBI can acquire reclaimed
lands when there was no declaration that said lands
are no
longer needed for
public use
Petitioner
Chavez avers that despite the declaration that the reclaimed areas are
alienable lands of the public domain, still, the reclamation is flawed for
there was never any declaration that said lands are no longer needed for public
use.
We
are not moved by petitioner’s submission.
Even
if it is conceded that there was no explicit declaration that the lands are no
longer needed for public use or public service, there was however an implicit
executive declaration that the reclaimed areas R-10 are not necessary anymore
for public use or public service when President Aquino through MO 415 conveyed
the same to the NHA partly for housing project and related
commercial/industrial development intended for disposition to and enjoyment of
certain beneficiaries and not the public in general and partly as enabling component
to finance the project.
President Ramos, in issuing
Proclamation No. 39, declared, though indirectly, that the reclaimed lands of
the Smokey Mountain project are no longer required for public use or service,
thus:
These parcels of land of public domain are hereby placed under the administration and disposition of the National Housing Authority to develop, subdivide and dispose to qualified beneficiaries, as well as its development for mix land use (commercial/industrial) to provide employment opportunities to on-site families and additional areas for port related activities. (Emphasis supplied.)
While
numerical count of the persons to be benefited is not the determinant whether
the property is to be devoted to public use, the declaration in Proclamation
No. 39 undeniably identifies only particular individuals as beneficiaries to
whom the reclaimed lands can be sold, namely—the
In addition, President Ramos issued
on August 31, 1994 Proclamation No. 465 increasing the area to be reclaimed
from forty (40) hectares to seventy-nine (79) hectares, elucidating that said
lands are undoubtedly set aside for the beneficiaries of SMDRP and not the
public—declaring the power of NHA to dispose of land to be reclaimed,
thus: “The authority to administer,
develop, or dispose lands identified and reserved by this Proclamation
and Proclamation No. 39 (s.1992), in accordance with the SMDRP, as enhance, is
vested with the NHA, subject to the provisions of existing laws.” (Emphasis
supplied.)
MO
415 and Proclamations Nos. 39 and 465 are declarations that proclaimed the non-use
of the reclaimed areas for public use or service as the Project cannot be
successfully implemented without the withdrawal of said lands from public use
or service. Certainly, the devotion of the reclaimed land to public use or
service conflicts with the intended use of the Smokey Mountain areas for
housing and employment of the Smokey Mountain scavengers and for financing the Project
because the latter cannot be accomplished without abandoning the public use of
the subject land. Without doubt, the presidential
proclamations on SMDRP together with the issuance of the special patents had effectively
removed the reclaimed lands from public use.
More
decisive and not in so many words is the ruling in PEA which we earlier cited, that “PD No. 1085 and President
Aquino’s issuance of a land patent also constitute a declaration that the
Freedom Islands are no longer needed for public service.” Consequently, we ruled in that case that the
reclaimed lands are “open to disposition or concession to qualified parties.”[83]
In
a similar vein, presidential Proclamations Nos. 39 and 465 jointly with the
special patents have classified the reclaimed lands as alienable and disposable
and open to disposition or concession as they would be devoted to units for
Moreover,
reclaimed lands that are made the enabling components of a BOT infrastructure
project are necessarily reclassified
as alienable and disposable lands under the BOT Law; otherwise, absurd and
illogical consequences would naturally result.
Undoubtedly, the BOT contract will not be accepted by the BOT contractor
since there will be no consideration for its contractual obligations. Since reclaimed land will be conveyed to the
contractor pursuant to the BOT Law, then there is an implied declaration that
such land is no longer intended for
public use or public service and,
hence, considered patrimonial property of the State.
Fifth Issue:
Whether there is a law authorizing sale of
reclaimed lands
Petitioner
next claims that RBI cannot acquire the reclaimed lands because there was no
law authorizing their sale. He argues
that unlike PEA, no legislative authority was granted to the NHA to sell
reclaimed land.
This
position is misplaced.
Petitioner relies on Sec. 60 of Commonwealth Act (CA) 141 to support his view that the NHA is not empowered by any law to sell reclaimed land, thus:
Section 60. Any tract of land comprised under this title may be leased or sold, as the case may be, to any person, corporation or association authorized to purchase or lease public lands for agricultural purposes. The area of the land so leased or sold shall be such as shall, in the judgment of the Secretary of Agriculture and Natural Resources, be reasonably necessary for the purposes for which such sale or lease if requested and shall in no case exceed one hundred and forty-four hectares: Provided, however, That this limitation shall not apply to grants, donations, transfers, made to a province, municipality or branch or subdivision of the Government for the purposes deemed by said entities conducive to the public interest; but the land so granted donated or transferred to a province, municipality, or branch or subdivision of the Government shall not be alienated, encumbered, or otherwise disposed of in a manner affecting its title, except when authorized by Congress; Provided, further, That any person, corporation, association or partnership disqualified from purchasing public land for agricultural purposes under the provisions of this Act, may lease land included under this title suitable for industrial or residential purposes, but the lease granted shall only be valid while such land is used for the purposes referred to. (Emphasis supplied.)
Reliance
on said provision is incorrect as the same applies only to “a province,
municipality or branch or subdivision of the Government.” The NHA is not a government unit but a
government corporation performing governmental and proprietary functions.
In
addition, PD 757 is clear that the NHA is empowered by law to transfer
properties acquired by it under the law to other parties, thus:
Section
6. Powers and functions of the Authority. The Authority shall have the following powers
and functions to be exercised by the Boards in accordance with the established
national human settlements plan prepared by the Human Settlements Commission:
x x x x
(k) Enter into contracts whenever necessary under such terms and conditions as it may deem proper and reasonable;
(l) Acquire property rights and interests, and encumber or otherwise dispose the same as it may deem appropriate (Emphasis supplied.)
Letter
(l) is emphatic that the NHA can acquire property rights and interests and
encumber or otherwise dispose of them as it may deem appropriate. The transfer of the reclaimed lands by the National
Government to the NHA for housing, commercial, and industrial purposes
transformed them into patrimonial lands which are of course owned by the State
in its private or proprietary capacity. Perforce,
the NHA can sell the reclaimed lands to any Filipino citizen or qualified
corporation.
Sixth Issue:
Whether the transfer of reclaimed lands to RBI
was done by public bidding
Petitioner
also contends that there was no public bidding but an awarding of ownership of
said reclaimed lands to RBI. Public
bidding, he says, is required under Secs. 63 and 67 of CA 141 which read:
Section
63. Whenever it is decided that lands covered
by this chapter are not needed for public purposes, the Director of Lands shall
ask the Secretary of Agriculture and Commerce for authority to dispose of the
same. Upon receipt of such authority,
the Director of Lands shall give notice by public advertisement in the same
manner as in the case of leases or sales of agricultural public land, that the
Government will lease or sell, as the case may be, the lots or blocks specified
in the advertisement, for the purpose stated in the notice and subject to the
conditions specified in this chapter.
x x x x
Section 67. The lease or sale shall be made through oral bidding; and adjudication shall be made to the highest bidder. However, where an applicant has made improvements on the land by virtue of a permit issued to him by competent authority, the sale or lease shall be made by sealed bidding as prescribed in section twenty-six of this Act, the provisions of which shall be applied whenever applicable. If all or part of the lots remain unleased or unsold, the Director of Lands shall from time to time announce in the Official Gazette or in any other newspapers of general circulation, the lease of sale of those lots, if necessary.
He finds that the NHA and RBI violated Secs. 63 and 67 of CA
141, as the reclaimed lands were conveyed to RBI by negotiated contract and not
by public bidding as required by law.
This
stand is devoid of merit.
There
is no doubt that respondent NHA conducted a public bidding of the right to
become its joint venture partner in the Smokey Mountain Project. Notices or Invitations to Bid were published
in the national dailies on January 23 and 26, 1992 and February 1, 14, 16, and
23, 1992. The bidding proper was done by
the Bids and Awards Committee (BAC) on
On
Petitioner
concedes that he does not question the public bidding on the right to be a
joint venture partner of the NHA, but the absence of bidding in the sale of alienable
and disposable lands of public domain pursuant to CA 141 as amended.
Petitioner’s
theory is incorrect.
Secs.
63 and 67 of CA 141, as amended, are in point as they refer to government sale
by the Director of Lands of alienable
and disposable lands of public domain.
This is not present in the case at bar.
The lands reclaimed by and conveyed to the NHA are no longer lands of
public domain. These lands became
proprietary lands or patrimonial properties of the State upon transfer of the
titles over the reclaimed lands to the NHA and hence outside the ambit of CA
141. The NHA can therefore legally
transfer patrimonial land to RBI or to any other interested qualified buyer
without any bidding conducted by the Director of Lands because the NHA, unlike
PEA, is a government agency not
tasked to sell lands of public domain.
Hence, it can only hold patrimonial lands and can dispose of such lands
by sale without need of public bidding.
Petitioner likewise relies on Sec. 79
of PD 1445 which requires public bidding “when government property has become
unserviceable for any cause or is no longer needed.” It appears from the Handbook on Property and Supply
Management System, Chapter 6, that reclaimed lands which have become
patrimonial properties of the State, whose titles are conveyed to government
agencies like the NHA, which it will use for its projects or programs, are not
within the ambit of Sec. 79. We quote
the determining factors in the Disposal of Unserviceable Property, thus:
Determining
Factors in the Disposal of Unserviceable Property
· Property, which can no longer be repaired or reconditioned;
· Property whose maintenance costs of repair more than outweigh the benefits and services that will be derived from its continued use;
· Property that has become obsolete or outmoded because of changes in technology;
· Serviceable property that has been rendered unnecessary due to change in the agency’s function or mandate;
· Unused supplies, materials and spare parts that were procured in excess of requirements; and
· Unused supplies and materials that [have] become dangerous to use because of long storage or use of which is determined to be hazardous.[85]
Reclaimed lands cannot be considered
unserviceable properties. The reclaimed
lands in question are very much needed by the NHA for the Smokey Mountain
Project because without it, then the projects will not be successfully
implemented. Since the reclaimed lands
are not unserviceable properties and are very much needed by NHA, then Sec. 79
of PD 1445 does not apply.
More
importantly, Sec. 79 of PD 1445 cannot be applied to patrimonial properties
like reclaimed lands transferred to a government agency like the NHA which has
entered into a BOT contract with a private firm. The reason is obvious. If the patrimonial property will be subject
to public bidding as the only way of disposing of said property, then Sec. 6 of
RA 6957 on the repayment scheme is almost impossible or extremely difficult to
implement considering the uncertainty of a winning bid during public
auction. Moreover, the repayment scheme
of a BOT contract may be in the form of non-monetary payment like the grant of
a portion or percentage of reclaimed land.
Even if the BOT partner participates in the public bidding, there is no
assurance that he will win the bid and therefore the payment in kind as agreed
to by the parties cannot be performed or the winning bid prize might be below
the estimated valuation of the land. The
only way to harmonize Sec. 79 of PD 1445 with Sec. 6 of RA 6957 is to consider
Sec. 79 of PD 1445 as inapplicable to BOT contracts involving patrimonial
lands. The law does not intend anything
impossible (lex non intendit aliquid impossibile).
Seventh Issue:
Whether RBI, being a private corporation,
is barred by the Constitution to acquire lands of
public domain
Petitioner maintains that RBI, being
a private corporation, is expressly prohibited by the 1987 Constitution from
acquiring lands of public domain.
Petitioner’s
proposition has no legal mooring for the following reasons:
1. RA 6957 as amended by RA 7718 explicitly
states that a contractor can be paid “a portion as percentage of the reclaimed
land” subject to the constitutional requirement that only Filipino citizens or
corporations with at least 60% Filipino equity can acquire the same. It cannot be denied that RBI is a private
corporation, where Filipino citizens own at least 60% of the stocks. Thus, the transfer to RBI is valid and constitutional.
2. When
Proclamations Nos. 39 and 465 were issued, inalienable lands covered by said
proclamations were converted to alienable and disposable lands of public
domain. When the titles to the reclaimed
lands were transferred to the NHA, said alienable and disposable lands of
public domain were automatically classified as lands of the private domain or
patrimonial properties of the State because the NHA is an agency NOT tasked to
dispose of alienable or disposable lands of public domain. The only way it can transfer the reclaimed
land in conjunction with its projects and to attain its goals is when it is
automatically converted to patrimonial properties of the State. Being patrimonial or private properties of
the State, then it has the power to sell the same to any qualified person—under
the Constitution, Filipino citizens as private corporations, 60% of which is
owned by Filipino citizens like RBI.
3. The NHA is an end-user entity such that
when alienable lands of public domain are transferred to said agency, they are
automatically classified as patrimonial properties. The NHA is similarly situated as BCDA which
was granted the authority to dispose of patrimonial lands of the government
under RA 7227. The nature of the
property holdings conveyed to BCDA is elucidated and stressed in the
BCDA is an entirely
different government entity. BCDA is authorized by law to sell specific
government lands that have long been declared by presidential proclamations as
military reservations for use by the different services of the armed forces
under the Department of National Defense. BCDA’s mandate is specific and
limited in area, while PEA’s mandate is general and national. BCDA holds
government lands that have been granted to end-user government entities––the
military services of the armed forces. In contrast, under Executive Order
No. 525, PEA holds the reclaimed public lands, not as an end-user entity, but
as the government agency “primarily responsible for integrating, directing, and
coordinating all reclamation projects for and on behalf of the National Government.”
x x x Well-settled
is the doctrine that public land granted to an end-user government agency for a
specific public use may subsequently be withdrawn by Congress from public use
and declared patrimonial property to be sold to private parties. R.A. No. 7227 creating the BCDA is a law
that declares specific military reservations no longer needed for defense or
military purposes and reclassifies such lands as patrimonial property for sale
to private parties.
Government owned lands, as long as they are
patrimonial property, can be sold to private parties, whether Filipino citizens
or qualified private corporations. Thus, the so-called Friar Lands
acquired by the government under Act No. 1120 are patrimonial property which
even private corporations can acquire by purchase. Likewise, reclaimed
alienable lands of the public domain if sold or transferred to a public or
municipal corporation for a monetary consideration become patrimonial property
in the hands of the public or municipal corporation. Once converted to
patrimonial property, the land may be sold by the public or municipal
corporation to private parties, whether Filipino citizens or qualified private
corporations.[86] (Emphasis supplied.)
The
foregoing Resolution makes it clear that the SMDRP was a program adopted by the
Government under Republic Act No. 6957 (An Act Authorizing the Financing,
Construction, Operation and Maintenance of Infrastructure Projects by the
Private Sector, and For Other Purposes), as amended by RA 7718, which is a
special law similar to RA 7227.
Moreover, since the implementation was assigned to the NHA, an end-user
agency under PD 757 and RA 7279, the reclaimed lands registered under the NHA
are automatically classified as patrimonial lands ready for disposition to
qualified beneficiaries.
The
foregoing reasons likewise apply to the contention of petitioner that HCPTI,
being a private corporation, is disqualified from being a transferee of public
land. What was transferred to HCPTI is a
10-hectare lot which is already classified as patrimonial property in the hands
of the NHA. HCPTI, being a qualified
corporation under the 1987 Constitution, the transfer of the subject lot to it is
valid and constitutional.
Eighth Issue:
Whether respondents can be compelled to disclose
all information related to the SMDRP
Petitioner
asserts his right to information on all documents such as contracts, reports,
memoranda, and the like relative to SMDRP.
Petitioner
asserts that matters relative to the SMDRP have not been disclosed to the
public like the current stage of the Project, the present financial capacity of
RBI, the complete list of investors in the asset pool, the exact amount of
investments in the asset pool and other similar important information regarding
the Project.
He prays that respondents be
compelled to disclose all information regarding the SMDRP and furnish him with
originals or at least certified true copies of all relevant documents relating
to the said project including, but not limited to, the original JVA, ARJVA,
AARJVA, and the Asset Pool Agreement.
This
relief must be granted.
The right of the Filipino people to
information on matters of public concern is enshrined in the 1987 Constitution,
thus:
ARTICLE
II
x x x x
SEC. 28. Subject to reasonable conditions prescribed by law, the State adopts and implements a policy of full public disclosure of all its transactions involving public interest.
ARTICLE
III
SEC. 7. The right of the people to information on matters of public concern shall be recognized. Access to official records, and to documents, and papers pertaining to official acts, transactions, or decisions, as well as to government research data used as basis for policy development, shall be afforded the citizen, subject to such limitations as may be provided by law.
In
Valmonte v. Belmonte, Jr., this Court
explicated this way:
[A]n essential element of these freedoms is to keep open a continuing dialogue or process of communication between the government and the people. It is in the interest of the State that the channels for free political discussion be maintained to the end that the government may perceive and be responsive to the people’s will. Yet, this open dialogue can be effective only to the extent that the citizenry is informed and thus able to formulate its will intelligently. Only when the participants in the discussion are aware of the issues and have access to information relating thereto can such bear fruit.[87]
In
PEA, this Court elucidated the
rationale behind the right to information:
These twin provisions of the Constitution seek to promote transparency in policy-making and in the operations of the government, as well as provide the people sufficient information to exercise effectively other constitutional rights. These twin provisions are essential to the exercise of freedom of expression. If the government does not disclose its official acts, transactions and decisions to citizens, whatever citizens say, even if expressed without any restraint, will be speculative and amount to nothing. These twin provisions are also essential to hold public officials “at all times x x x accountable to the people,” for unless citizens have the proper information, they cannot hold public officials accountable for anything. Armed with the right information, citizens can participate in public discussions leading to the formulation of government policies and their effective implementation. An informed citizenry is essential to the existence and proper functioning of any democracy.[88]
Sec. 28, Art. II compels the State
and its agencies to fully disclose “all of its transactions involving public
interest.” Thus, the government agencies,
without need of demand from anyone, must bring into public view all the steps
and negotiations leading to the consummation of the transaction and the
contents of the perfected contract.[89] Such information must pertain to “definite
propositions of the government,” meaning official recommendations or final
positions reached on the different matters subject of negotiation. The government agency, however, need not
disclose “intra-agency or inter-agency recommendations or communications during
the stage when common assertions are still in the process of being formulated
or are in the exploratory stage.” The
limitation also covers privileged communication like information on military
and diplomatic secrets; information affecting national security; information on
investigations of crimes by law enforcement agencies before the prosecution of
the accused; information on foreign relations, intelligence, and other
classified information.
It is unfortunate, however, that
after almost twenty (20) years from birth of the 1987 Constitution, there is
still no enabling law that provides the mechanics for the compulsory duty of
government agencies to disclose information on government transactions. Hopefully, the desired enabling law will
finally see the light of day if and when Congress decides to approve the
proposed “Freedom of Access to Information Act.” In the meantime, it would suffice that
government agencies post on their bulletin boards the documents incorporating
the information on the steps and negotiations that produced the agreements and
the agreements themselves, and if finances permit, to upload said information on
their respective websites for easy access by interested parties. Without any law or regulation governing the
right to disclose information, the NHA or any of the respondents cannot be
faulted if they were not able to disclose information relative to the SMDRP to
the public in general.
The other aspect of the people’s
right to know apart from the duty to disclose is the duty to allow access to
information on matters of public concern under Sec. 7, Art. III of the
Constitution. The gateway to information
opens to the public the following: (1) official records; (2) documents and
papers pertaining to official acts, transactions, or decisions; and (3)
government research data used as a basis for policy development.
Thus,
the duty to disclose information should be differentiated from the duty to
permit access to information. There is
no need to demand from the government agency disclosure of information as this
is mandatory under the Constitution; failing that, legal remedies are
available. On the other hand, the
interested party must first request or even demand that he be allowed access to
documents and papers in the particular agency.
A request or demand is required; otherwise, the government office or
agency will not know of the desire of the interested party to gain access to
such papers and what papers are needed.
The duty to disclose covers only transactions involving public interest,
while the duty to allow access has a broader scope of information which
embraces not only transactions involving public interest, but any matter
contained in official communications and public documents of the government
agency.
We
find that although petitioner did not make any demand on the NHA to allow
access to information, we treat the petition as a written request or
demand. We order the NHA to allow
petitioner access to its official records, documents, and papers relating to
official acts, transactions, and decisions that are relevant to the said JVA
and subsequent agreements relative to the SMDRP.
Ninth Issue:
Whether the operative fact doctrine applies to the
instant petition
Petitioner
postulates that the “operative fact” doctrine is inapplicable to the present
case because it is an equitable doctrine which could not be used to countenance
an inequitable result that is contrary to its proper office.
On
the other hand, the petitioner Solicitor General argues that the existence of
the various agreements implementing the SMDRP is an operative fact that can no
longer be disturbed or simply ignored, citing Rieta v. People of the
The
argument of the Solicitor General is meritorious.
The
“operative fact” doctrine is embodied in De
Agbayani v. Court of Appeals, wherein it is stated that a legislative or
executive act, prior to its being declared as unconstitutional by the courts,
is valid and must be complied with, thus:
As the new Civil Code puts it:
“When the courts declare a law to be inconsistent with the Constitution, the
former shall be void and the latter shall govern. Administrative or executive
acts, orders and regulations shall be valid only when they are not contrary to
the laws of the Constitution.” It is
understandable why it should be so, the Constitution being supreme and
paramount. Any legislative or executive act contrary to its terms cannot
survive.
Such a view has support in logic and possesses the merit of simplicity. It may not however be sufficiently realistic. It does not admit of doubt that prior to the declaration of nullity such challenged legislative or executive act must have been in force and had to be complied with. This is so as until after the judiciary, in an appropriate case, declares its invalidity, it is entitled to obedience and respect. Parties may have acted under it and may have changed their positions. What could be more fitting than that in a subsequent litigation regard be had to what has been done while such legislative or executive act was in operation and presumed to be valid in all respects. It is now accepted as a doctrine that prior to its being nullified, its existence as a fact must be reckoned with. This is merely to reflect awareness that precisely because the judiciary is the governmental organ which has the final say on whether or not a legislative or executive measure is valid, a period of time may have elapsed before it can exercise the power of judicial review that may lead to a declaration of nullity. It would be to deprive the law of its quality of fairness and justice then, if there be no recognition of what had transpired prior to such adjudication.
In
the language of an American Supreme Court decision: “The actual existence of a statute, prior to such a determination [of
unconstitutionality], is an operative fact and may have consequences which
cannot justly be ignored. The past
cannot always be erased by a new judicial declaration. The effect of the subsequent ruling as to
invalidity may have to be considered in various aspects, with respect to
particular relations, individual and corporate, and particular conduct, private
and official.” This language has been
quoted with approval in a resolution in Araneta
v. Hill and the decision in Manila
Motor Co., Inc. v.
This
doctrine was reiterated in the more recent case of City of Makati v. Civil Service Commission, wherein we ruled that:
Moreover, we certainly cannot nullify the City Government’s order of suspension, as we have no reason to do so, much less retroactively apply such nullification to deprive private respondent of a compelling and valid reason for not filing the leave application. For as we have held, a void act though in law a mere scrap of paper nonetheless confers legitimacy upon past acts or omissions done in reliance thereof. Consequently, the existence of a statute or executive order prior to its being adjudged void is an operative fact to which legal consequences are attached. It would indeed be ghastly unfair to prevent private respondent from relying upon the order of suspension in lieu of a formal leave application.[92] (Emphasis supplied.)
The
principle was further explicated in the case of Rieta v. People of the
In similar situations in
the past this Court had taken the pragmatic and realistic course set forth in
Chicot County Drainage District vs. Baxter Bank to wit:
The courts below have proceeded on the theory that the Act of
Congress, having been found to be unconstitutional, was not a law; that it was
inoperative, conferring no rights and imposing no duties, and hence affording
no basis for the challenged decree. x x x It is quite clear, however, that such
broad statements as to the effect of a determination of unconstitutionality
must be taken with qualifications. The
actual existence of a statute, prior to [the determination of its invalidity],
is an operative fact and may have consequences which cannot justly be
ignored. The past cannot always be
erased by a new judicial declaration.
The effect of the subsequent ruling as to invalidity may have to be
considered in various aspects –with respect to particular conduct, private and
official. Questions of rights claimed to
have become vested, of status, of prior determinations deemed to have finality
and acted upon accordingly, of public policy in the light of the nature both of
the statute and of its previous application, demand examination. These questions are among the most difficult
of those which have engaged the attention of courts, state and federal, and it
is manifest from numerous decisions that an all-inclusive statement of a
principle of absolute retroactive invalidity cannot be justified.
In
the May 6, 2003 Resolution in Chavez v. PEA,[93] we
ruled that De Agbayani[94]
is not applicable to the case considering that the prevailing law did not
authorize private corporations from owning land. The prevailing law at the time was the 1935
Constitution as no statute dealt with the same issue.
In the instant case, RA 6957 was the
prevailing law at the time that the joint venture agreement was signed. RA 6957, entitled “An Act Authorizing The
Financing, Construction, Operation And Maintenance Of Infrastructure Projects
By The Private Sector And For Other Purposes,” which was passed by Congress on
Further,
in the May 6, 2003 Resolution in Chavez
v. PEA, we ruled that in certain cases, the transfer of land, although
illegal or unconstitutional, will not be invalidated on considerations of
equity and social justice. However, in
that case, we did not apply the same considering that PEA, respondent in said
case, was not entitled to equity principles there being bad faith on its part,
thus:
There are, moreover, special
circumstances that disqualify Amari from invoking equity principles.
Amari cannot claim good faith because even before Amari signed the Amended JVA
on
Such
indicia of bad faith are not present
in the instant case. When the ruling in PEA was rendered by this Court on
The Court’s Dispositions
Based
on the issues raised in this petition, we find that the March 19, 1993 JVA
between NHA and RBI and the SMDRP embodied in the JVA, the subsequent
amendments to the JVA and all other agreements signed and executed in relation
to it, including, but not limited to, the September 26, 1994 Smokey Mountain
Asset Pool Agreement and the agreement on Phase I of the Project as well as all
other transactions which emanated from the Project, have been shown to be
valid, legal, and constitutional. Phase
II has been struck down by the Clean Air Act.
With
regard to the prayer for prohibition, enjoining respondents particularly
respondent NHA from further implementing and/or enforcing the said Project and
other agreements related to it, and from further deriving and/or enjoying any
rights, privileges and interest from the Project, we find the same prayer meritless.
Sec.
2 of Rule 65 of the 1997 Rules of Civil Procedure provides:
Sec. 2. Petition for prohibition.—When the proceedings of any tribunal, corporation, board, officer or person, whether exercising judicial, quasi-judicial or ministerial functions, are without or in excess of its or his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law, a person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered commanding the respondent to desist from further proceedings in the action or matter specified therein, or otherwise granting such incidental reliefs as law and justice may require.
It has not been shown that the NHA
exercised judicial or quasi-judicial functions in relation to the SMDRP and the
agreements relative to it. Likewise, it has not been shown what ministerial
functions the NHA has with regard to the SMDRP.
A
ministerial duty is one which is so clear and specific as to leave no room for
the exercise of discretion in its performance.
It is a duty which an officer performs in a given state of facts in a
prescribed manner in obedience to the mandate of legal authority, without
regard to the exercise of his/her own judgment upon the propriety of the act
done.[97]
Whatever is left to be done in relation to the
In
addition, prohibition does not lie against the NHA in view of petitioner’s
failure to avail and exhaust all administrative remedies. Clear is the rule that prohibition is only
available when there is no adequate remedy in the ordinary course of law.
More
importantly, prohibition does not lie to restrain an act which is already a fait accompli. The “operative fact” doctrine protecting
vested rights bars the grant of the writ of prohibition to the case at bar. It
should be remembered that petitioner was the Solicitor General at the time SMDRP
was formulated and implemented. He had
the opportunity to question the SMDRP and the agreements on it, but he did not. The moment to challenge the Project had
passed.
On the prayer for a writ of mandamus,
petitioner asks the Court to compel respondents to disclose all documents and
information relating to the project, including, but not limited to, any
subsequent agreements with respect to the different phases of the Project, the
revisions of the original plan, the additional works incurred on the Project,
the current financial condition of respondent RBI, and the transactions made with
respect to the project. We earlier ruled
that petitioner will be allowed access to official records relative to the
SMDRP. That would be adequate relief to
satisfy petitioner’s right to the information gateway.
WHEREFORE, the
petition is partially granted.
The prayer for a writ of prohibition is
DENIED for lack of merit.
The
prayer for a writ of mandamus is GRANTED. Respondent NHA is ordered to allow access to
petitioner to all public documents and official records relative to the SMDRP—including, but not limited to, the
March 19, 1993 JVA between the NHA and RBI and subsequent agreements related to
the JVA, the revisions over the original plan, and the additional works
incurred on and the transactions made with respect to the Project.
No costs.
SO ORDERED.
PRESBITERO
J. VELASCO, JR.
Associate Justice
WE
CONCUR:
REYNATO S.
PUNO
Chief Justice
LEONARDO A. QUISUMBING CONSUELO YNARES-SANTIAGO
Associate Justice Associate Justice
ANGELINA SANDOVAL-GUTIERREZ ANTONIO T. CARPIO
Associate Justice
Associate
Justice
MA. ALICIA AUSTRIA-MARTINEZ RENATO C. CORONA Associate
Justice Associate Justice
CONCHITA CARPIO MORALES ADOLFO S. AZCUNA
Associate Justice Associate
Justice
DANTE
O. TINGA MINITA V. CHICO-NAZARIO
Associate Justice Associate Justice
CANCIO C. GARCIA ANTONIO EDUARDO B. NACHURA
Associate
Justice Associate Justice
RUBEN T. REYES
Associate Justice
C E R T I F
I C A T I O N
Pursuant to Section 13, Article VIII of the
Constitution, it is hereby certified that the conclusions in the above Decision
were reached in consultation before the case was assigned to the writer of the
opinion of the Court.
REYNATO S. PUNO
Chief Justice
[8] “Joint Resolution Approving the List of National Projects to be Undertaken by the Private Sector Pursuant to Republic Act No. 6957.”
[18] “Creating the National Housing Authority and Dissolving
the Existing Housing Agencies, Defining its Powers and Functions, Providing Funds
Therefor, and for Other Purposes” (1975).
[48] Bayan (Bagong Alyansang Makabayan) v. Zamora, G.R. Nos. 138570, 138572, 138587, 138680 & 138698, October 10, 2000, 342 SCRA 449, 478.
[49]
G.R. No. 130716,
[50]
G.R. No. 133250,
[51]
G.R. No. 67787,
[53] 1. Petitioner
claimed that NHA awarded the Smokey Mountain project to R-II Builders through contract
negotiations and that there was no public bidding awarding ownership of the
subject land to respondent R-II Builders, while respondents alleged that NHA
publicly bidded out the right to become NHA’s joint venture partner in the
prosecution of the SMDRP;
2.
Petitioner averred that “PEA had no participation whatsoever in the reclamation
of the subject lands” while
respondents stated PEA had a name therein;
3.
Petitioner alleged that “neither respondent NHA nor respondent R-II Builders
was given the authority [by DENR] to
reclaim the subject lands” while respondents claimed such authority was granted;
4. Mr. Chavez claimed “that there is no
legislative or Presidential act classifying the submerged areas around Smokey Mountain as alienable or
disposable lands of the public domain open
to disposition” while respondents said that Presidents Aquino and Ramos made
the classification;
5. Whether respondent R-II Builders
complied with its obligation to “fully finance” the Project;
6. Whether the Project has been terminated
by agreements of the parties;
7. Whether respondents Harbour Centre and
Romero fraudulently caused the dilution of the Asset
Pool’s Holdings in HCPTI;
8. Whether Harbour Centre contracts attached to the Petition are genuine.
[56] “Designating
the Public Estates Authority as the Agency Primarily Responsible for All Reclamation
Projects” (1979).
[58]
The July 9, 2002 Decision entitled Chavez
v. PEA was concurred in by 13 members of this Court who voted to grant the
petition. However, in the
[59] The doctrine of stare decisis provides that a conclusion reached in one case should, for the sake of certainty, be applied to those which follow if the facts are substantially the same even though the parties may be different.
[60] Supra note 50, at 221.
[61]
“Creating the Public Estates Authority, Defining its Power and Functions, Providing
Funds Therefor and for Other Purposes” (1977).
[62] “An
Act to Provide for a Comprehensive and Continuing Urban Development and Housing
Program, Establish the Mechanism for its Implementation, and for Other Purposes”
(1992).
[63] Radio Communications of the Philippines,
Inc. v.
[66] Provident Tree Farms, Inc. v. Batario, Jr., G.R. No. 92285, March 28, 1994, 231 SCRA 463, 469; cited in Agpalo, Administrative Code 14.
[67] “Amending Section 7 of Presidential Decree No. 3 dated September 26, 1972, by Providing for the Exclusive Prosecution by Administration or by Contract of Reclamation Projects” (2005).
[69] “Delegating to the Philippine Reclamation Authority the Power to Approve Reclamation Projects” (2006).
[75]
[76] Republic of the Philippines v. Manila Electric Company, G.R. No. 141314, April 9, 2003, 401 SCRA 130, 141.
[84] Article 422. Property of public dominion, when no longer intended for public use or public service, shall form part of the patrimonial property of the State.
[85]
Commission on Audit,
[86]
G.R. No. 133250,
[95] RA 6957, Sec. 6 provides:
Section 6. Repayment Scheme.—For the financing, construction, operation, and maintenance of any infrastructure project undertaken pursuant to the provisions of this Act, the constructor shall be entitled to a reasonable return of its investment and operating and maintenance costs in accordance with its bid proposal as accepted by the concerned contracting infrastructure agency or local government unit and incorporated in the contract’s terms and conditions. In the case of a build-operate-and-transfer arrangement, this repayment scheme is to be affected by authorizing the contractor to charge for the use of the project facility not exceeding those proposed in the bid and incorporated in the contract: Provided, That the government infrastructure agency or local government unit concerned shall approve the fairness and equity of the tolls, fees, rentals and charges except in case of tolls for national highways, roads, bridges and public thoroughfares which shall be approved by the Toll Regulatory Board: Provided, further, That the imposition and collection of tolls, fees, rentals and charges shall be for a fixed term as proposed in the bid and incorporated in the contract but in no case shall this term exceed fifty (50) years: Provided, finally, That during the lifetime of the franchise, the contractor shall undertake the necessary maintenance and repair of the facility in accordance with standards prescribed in the bidding documents and in the contract. In the case of a build-and-transfer arrangements, the repayment scheme is to be affected through amortization payments by the government unit concerned to the contractor according to the scheme proposed in the bid and incorporated in the contract.
In the case of land reclamation or
the building of industrial estates, the repayment scheme may consist of the grant of a
portion of percentage of the reclaimed land or industrial estate built, subject to the constitutional requirements
with respect to the ownership of lands.