Republic of the
SUPREME COURT
SECOND DIVISION
CELESTIAL NICKEL MINING G.R. No. 169080
EXPLORATION CORPORATION,
Petitioner,
Present:
- versus -
QUISUMBING,
J., Chairperson,
CARPIO
MORALES,
MACROASIA CORPORATION TINGA,
(formerly INFANTA MINERAL AND VELASCO, JR.,
and
INDUSTRIAL CORPORATION), CHICO-NAZARIO,*
JJ.
BLUE RIDGE MINERAL
CORPORATION, and LEBACH
MINING CORPORATION,
Respondents.
x
---------------------------------------------- x
BLUE RIDGE MINERAL G.R. No. 172936
CORPORATION,
Petitioner,
- versus -
HON. ANGELO REYES in his
capacity as SECRETARY of
the DEPARTMENT OF
ENVIRONMENT AND NATURAL Promulgated:
RESOURCES, HON. GUILLERMO
ESTABILLO in his capacity as
REGIONAL DIRECTOR of the December 19, 2007
MINES AND GEOSCIENCES
BUREAU, REGION IV-B of the
DEPARTMENT OF ENVIRONMENT
AND NATURAL RESOURCES, and
MACROASIA CORPORATION
(formerly INFANTA MINERAL AND
INDUSTRIAL CORPORATION),
Respondents.
x
---------------------------------------------- x
CELESTIAL NICKEL MINING G.R. No. 176226
EXPLORATION CORPORATION,
Petitioner,
- versus -
BLUE RIDGE MINERAL
CORPORATION and MACROASIA
CORPORATION (formerly INFANTA
MINERAL AND INDUSTRIAL
CORPORATION),
Respondents.
x
---------------------------------------------- x
MACROASIA CORPORATION G.R.
No. 176319
(formerly INFANTA MINERAL AND
INDUSTRIAL CORPORATION),
Petitioner,
- versus -
BLUE RIDGE MINERAL
CORPORATION and CELESTIAL
NICKEL MINING EXPLORATION
CORPORATION,
Respondents.
x-----------------------------------------------------------------------------------------x
D E C I S I
O N
VELASCO,
JR., J.:
The
Case
Before
us are four (4) petitions.
The first is a Petition for Review on Certiorari[1]
under Rule 45 docketed as G.R. No.
169080, wherein petitioner Celestial Nickel Mining Exploration Corporation
(Celestial) seeks to set aside the April 15, 2005 Decision[2] of
the Court of Appeals (CA) in CA-G.R. SP No. 87931. The CA affirmed the November
26, 2004 Resolution of the Mines Adjudication Board (MAB) in MAB Case Nos.
056-97 and 057-97 (DENR Case Nos. 97-01 and 97-02), upholding the authority of
the Department of Environment and Natural Resources (DENR) Secretary to grant
and cancel mineral agreements. Also assailed is the
The
second is a Petition for Certiorari[4] under
Rule 65 docketed as G.R. No. 172936,
wherein petitioner Blue Ridge Mineral Corporation (Blue Ridge) seeks to annul
and set aside the action of then Secretary Michael T. Defensor, in his capacity
as DENR Secretary, approving and signing two Mineral Production Sharing
Agreements (MPSAs) in favor of Macroasia Corporation (Macroasia) denominated as
MPSA Nos. 220-2005-IVB and 221-2005-IVB.
And the
third and fourth are petitions for review on certiorari[5]
under Rule 45 docketed as G.R. No. 176226 and G.R. No. 176319,
wherein petitioners Celestial and Macroasia, respectively, seek to set aside
the May 18, 2006 Decision[6] of
the CA in CA-G.R. SP No. 90828. The CA reversed
and set aside the November 26, 2004 and July 12, 2005 Resolutions of the MAB,
and reinstated the October 24, 2000 Decision in MAB Case Nos. 056-97 and
057-97, granting Blue Ridge the prior and preferential right to file its
application over the mining claims of Macroasia. These petitions likewise seek
to set aside the
Through
our
The undisputed
facts as found by the CA in CA-G.R. SP No. 87931 are as follows:
On
Contract
No.
Area Date of Issuance
LLC-V-941 18 hectares
LC-V-1050 216 hectares
LLC-V-1060 16 hectares
LLC-V-1061 144 hectares
LLC-V-1073 144 hectares
MLC-MRD-52 306 hectares
MLC-MRC-53 72 hectares
Infanta’s corporate name was changed to Cobertson Holdings
Corporation on
Sometime in 1997, Celestial filed a Petition to Cancel the
subject mining lease contracts and other mining claims of Macroasia including
those covered by Mining Lease Contract No. V-1050, before the Panel of
Arbitrators (POA) of the Mines and Geo-Sciences Bureau (MGB) of the DENR. The petition was docketed as DENR Case No.
97-01.
Celestial is the assignee of 144 mining claims
covering such areas contiguous to Infanta’s (now Macroasia) mining lode
claims. Said area was involved in
protracted administrative disputes with Infanta (now Macroasia), Lecar &
Sons, Inc., and Palawan Nickel Mining Corporation. Celestial also holds an MPSA with the
government which covers 2,835 hectares located at Ipilan/Maasin, Brooke’s
Point,
Celestial
sought the cancellation of Macroasia’s lease contracts on the following
grounds: (1) the nonpayment of Macroasia
of required occupational fees and municipal taxes; (2) the non-filing of Macroasia
of Affidavits of Annual Work Obligations; (3) the failure of Macroasia to
provide improvements on subject mining claims; (4) the concentration of Macroasia
on logging; (5) the encroachment, mining, and extraction by Macroasia of nickel
ore from Celestial’s property; (6) the ability of Celestial to subject the
mining areas to commercial production; and (7) the willingness of Celestial to pay fees and back
taxes of Macroasia.
In the later part of the proceedings, Macroasia intervened
in the case and submitted its position paper refuting the grounds for
cancellation invoked by Celestial.[11]
The Ruling of the Panel
of Arbitrators in
DENR Case Nos. 97-01 and
97-02
Based on
the records of the Bureau of Mines and findings of the field investigations,
the POA found that Macroasia and Lebach not only automatically abandoned their
areas/mining claims but likewise had lost all their rights to the mining
claims. The POA granted the petition of Celestial to cancel the following Mining
Lease Contracts of Macroasia: LLC-V-941, LLC-V-1050, LLC-V-1060, LLC-V-1061,
LLC-V-1073, MLC-MRD-52, and MLC-MRC-53; and found the claims of the others indubitably
meritorious. It gave Celestial the preferential
right to Macroasia’s mining areas.[12] It upheld Blue Ridge’s petition regarding DENR
Case No. 97-02, but only as against the Mining Lease Contract areas of Lebach (LLC-V-1153,
LLC-V-1154, and LLC-V-1155), and the said leased areas were declared automatically
abandoned. It gave
Lebach did
not file any notice of appeal with the required memorandum of appeal; thus,
with respect to Lebach, the above resolution became final and executory.
The Rulings of the Mines
Adjudication Board in
MAB Case Nos. 056-97 and
057-97 (DENR Case Nos. 97-01 and 97-02)
The MAB
resolved the issues of timeliness and perfection of Macroasia’s appeal; Macroasia’s
abandonment of its mining claims; and the preferential right over the abandoned
mining claims of Macroasia.
Conformably
with Section 51 of Consolidated Mines Administrative Order (CMAO)[14]
implementing Presidential Decree No. (PD) 463[15]
and our ruling in Medrana v. Office of the President (OP),[16] the
MAB affirmed the POA findings that Macroasia abandoned its mining claims. The MAB found that Macroasia did not comply
with its work obligations from 1986 to 1991. It based its conclusion on the
field verifications conducted by the MGB, Region IV and validated by the
Special Team tasked by the MAB.[17] However,
contrary to the findings of the POA, the MAB found that it was
Thus,
on
Both
Celestial and Macroasia moved for reconsideration.[19] Celestial
asserted that it had better rights than
Macroasia,
in its Motion for Reconsideration, reiterated that it did not abandon its
mining claims, and even if mining was not listed among its purposes in its
amended Articles of Incorporation, its mining activities were acts that were only
ultra vires but were ratified as a secondary purpose by its stockholders
in subsequent amendments of its Articles
of Incorporation.
Before
the MAB could resolve the motions for reconsideration, on
Subsequently,
on November 26, 2004, the MAB issued a Resolution[22]
vacating its October 24, 2000 Decision, holding that neither the POA nor the
MAB had the power to revoke a mineral agreement duly entered into by the DENR
Secretary, ratiocinating that there was no provision giving the POA and MAB the
concurrent power to manage or develop mineral resources. The MAB further held
that the power to cancel or revoke a mineral agreement was exclusively lodged
with the DENR Secretary; that a petition for cancellation is not a mining
dispute under the exclusive jurisdiction of the POA pursuant to Sec. 77 of RA
7942; and that the POA could only adjudicate claims or contests during the MPSA
application and not when the claims and leases were already granted and
subsisting.
Moreover,
the MAB held that there was no abandonment by Macroasia because the DENR Secretary
had not decided to release Macroasia from its obligations. The Secretary may
choose not to release a contractor from its obligations on grounds of public
interest. Thus, through its said resolution,
the MAB rendered its disposition, as follows:
WHEREFORE,
premises considered, the assailed Decision of
After
the issuance of the MAB Resolution, Celestial and
On
On the
other hand,
CA-G.R. SP No. 87931 filed by Celestial was heard
by the 12th Division of the CA; while
The Ruling of the Court
of Appeals Twelfth Division
On
April 15, 2005, in CA-G.R. SP No. 87931, the CA 12th Division affirmed the
November 26, 2004 MAB Resolution which declared Macroasia’s seven mining lease
contracts as subsisting; rejected Blue Ridge’s claim for preferential right
over said mining claims; and upheld the exclusive
authority of the DENR Secretary to approve, cancel, and revoke mineral
agreements. The CA also denied Celestial’s Motion for Reconsideration[28] of
the assailed
Hence, Celestial
filed its Petition for Review on Certiorari[30] docketed
as G.R. No. 169080, before this Court.
The Ruling of the Court
of Appeals Special Tenth Division
On May
18, 2006, the CA Special 10th Division in CA-G.R. SP No. 90828 granted Blue
Ridge’s petition; reversed and set aside the November 26, 2004 and July 12,
2005 Resolutions of the MAB; and reinstated the October 24, 2000 Decision in
MAB Case Nos. 056-97 and 057-97. The
Special Tenth Division canceled Macroasia’s lease contracts; granted Blue Ridge
prior and preferential rights; and treated the cancellation of a mining lease
agreement as a mining dispute within the exclusive jurisdiction of the POA
under Sec. 77 of RA 7942, explaining that the power to resolve mining disputes,
which is the greater power, necessarily includes the lesser power to cancel
mining agreements.
On
Upon
inquiry with the DENR,
In the
meantime, on
The
Issues
In G.R.
No. 169080, petitioner Celestial raises the following issues for our
consideration:
(1) Whether
or not Macroasia, for reasons of public policy is estopped from assailing the alleged lack of jurisdiction of
the Panel of Arbitrators and the
Mines Adjudication Board only after
receiving an adverse judgment therefrom? [sic]
(2) Whether
or not it is only the Secretary of the DENR who has the jurisdiction to cancel mining contracts and privileges? [sic]
(3) Whether
or not a petition for the cancellation of a mining lease contract or privilege is a mining dispute
within the meaning of the law? [sic]
(4) Whether or not Infanta’s (Macroasia)
mining lease contract areas were deemed abandoned warranting the cancellation
of the lease contracts and the opening of the areas to other qualified
applicants? [sic]
(5) Whether
or not Macroasia/Infanta had lost its right to participate in this case after it failed to
seasonably file its appeal and after its
lease contracts had been declared abandoned and expired without having been renewed by the government? [sic]
(6) Whether
or not Celestial has the preferential right to apply for the 23 DE LARA claims which were included in
Infanta’s (Macroasia) expired
lease contract (LLC-V-941) and the other areas
declared as lapsed or abandoned by MGB-Region 4 and the Panel of Arbitrators?[37]
[sic]
In G.R. No. 172936, petitioner
I
At the outset,
the instant petition must be given due course and taken cognizance of by the
Honorable Court considering that exceptional and compelling circumstances
justify the availment of the instant petition and the call for the exercise of
the Honorable Court’s primary jurisdiction.
A. The exploration, development and
utilization of minerals, petroleum
and other mineral oils are imbued with public interest. The action of then Secretary Defensor,
maintained and continued by
public respondent Secretary Reyes, was tainted with
grave abuse of discretion, has far-reaching consequences because of the magnitude of the effect created
thereby.
B. The issues in the instant petition have
already been put to fore by Celestial
with the First Division of the Honorable Court, and hence, this circumstance justifies the cognizance by the Honorable Court of the instant petition.
II
It was grave
abuse of discretion amounting to lack and/or excess of jurisdiction for then
Secretary Defensor to have issued the subject MPSAs in favor of private
respondent Macroasia, considering that:
A. Non-compliance of the mandatory
requirements by private respondent
Macroasia prior to approval of the subject MPSAs should have precluded then Secretary Defensor from
approving subject MPSAs.
B. Petitioner
In G.R.
No. 176226, petitioner Celestial ascribes the following errors to the CA for
our consideration:
(1) That
in reinstating and adopting as its own the Decision of the Mine Adjudication
Board affirming the abandonment and cancellation of the mining areas/claims of
Macroasia (Infanta) but awarding the prior or preferential rights to
(2) That
the Hon. Court of Appeals has so far departed from the accepted and usual
course of judicial proceedings or so far sanctioned such departure by the Mines
Adjudication Board in its Decision of
(A) The findings of fact of the Hon. Court of
Appeals are contradictory or inconsistent with the findings of the Panel of
Arbitrators;
(B) There is grave abuse of discretion on the
part of the Hon. Court of Appeals in its appreciation of the facts, the
evidence and the law thereby leading it to make the erroneous conclusion that
Blue Ridge, not Celestial, is entitled to the Award of prior/preferential
rights over the mining areas declared as abandoned by Macroasia;
(C) There is likewise, a grave abuse of
discretion on the part of the Hon. Court of Appeals in that the said Court did
not even consider some of the issues raised by Celestial;
(D) That the findings of the Hon. Court of
Appeals are mere conclusions not supported by substantial evidence and without
citation of the specific evidence upon which they are based; they were arrived
at arbitrarily or in disregard of contradiction of the evidence on record and
findings of the Panel of Arbitrators in the Resolution of September 1, 1997;
(E) That the findings of the Hon. Court of
Appeals are premised on the absence of evidence but such findings are
contradicted by the evidence on record and are violative of the provisions of
RA 7942 and its Implementing Rules and Regulations.[39]
In G.R.
No. 176319, petitioner Macroasia raises the following grounds for the
allowance of the petition:
I.
The Court of
Appeals (Special Tenth Division) should have dismissed the Petition of Blue
Ridge outright since the issues, facts and matters involved in the said
Petition are identical to those which had already been painstakingly passed
upon, reviewed and resolved by the Court of Appeal’s Twelfth Division in
CA-G.R. SP No. 87931
II.
The Court of
Appeals (Special Tenth Division) gravely erred in denying Macroasia’s Motion to
Inhibit Associate Justice Rosmari Carandang from hearing and deciding the
Petition
III.
There were no
factual nor legal bases for the Court of Appeals to rule that Macroasia had
waived its right to question the jurisdiction of the Mines Adjudication Board
IV.
Republic Act
No. 7942 contains provisions which unequivocally indicate that only the
Secretary of the Department of Environment and Natural Resources has the power
and authority to cancel mining lease agreements
V.
The Court of
Appeals (Special Tenth Division) gravely erred in perfunctorily transferring
Macroasia’s mining lease agreements to
The
Court’s Ruling
The
petitions under G.R. Nos. 169080, 172936, and 176226 are bereft of merit, while
the petition under G.R. No. 176319 is meritorious.
The pith
of the controversy, upon which the other issues are hinged is, who has
authority and jurisdiction to cancel existing mineral agreements under RA 7942
in relation to PD 463 and pertinent rules and regulations.
G.R. Nos. 169080, 176226
and 176319
We will
jointly tackle G.R. Nos. 169080, 176266, and 176319 as the issues and arguments
of these three are inextricably intertwined.
Core
Issue: Jurisdiction over Cancellation of
Mineral Agreements
Petitioner
Celestial maintains that while the jurisdiction to approve mining lease
contracts or mineral agreements is conferred on the DENR Secretary, Sec. 77(a)
of RA 7942 by implication granted to the POA and MAB the authority to cancel
existing mining lease contracts or mineral agreements.
On the
other hand, respondent Macroasia strongly asserts that it is the DENR Secretary
who has the exclusive and primary jurisdiction to grant and cancel existing
mining lease contracts; thus, the POA and MAB have no jurisdiction to cancel much
less to grant any preferential rights to other mining firms.
Before
we resolve this core issue of jurisdiction over cancellation of mining lease
contracts, we first need to look back at previous mining laws pertinent to this
issue.
Under PD
463, The Mineral Resources Development Decree of 1974, which took effect on May 17,
1974, applications for lease of mining claims were required to be filed with
the Director of the Bureau of Mines, within two (2) days from the date of their
recording.[41] Sec. 40 of PD 463 provided that if no adverse
claim was filed within (15) days after the first date of publication, it was
conclusively presumed that no adverse claim existed and thereafter no objection
from third parties to the grant of the lease could be heard, except protests pending
at the time of publication. The Secretary would then approve and issue the
corresponding mining lease contract. In
case of any protest or adverse claim relating to any mining claim and lease
application, Secs. 48 and 50 of PD 463 prescribed the procedure. Under Sec. 48,
the protest should be filed with the Bureau of Mines. Under Sec. 50, any party not satisfied with
the decision or order of the Director could, within five (5) days from receipt of
the decision or order, appeal to the Secretary. The decisions of the Secretary were
likewise appealable within five (5) days from receipts by the affected party to
the President of the
On
On
RA 7942,
The Philippine Mining Act of 1995 enacted on
Compared
to PD 463 where disputes were decided by the Bureau of Mines Director whose
decisions were appealable to the DENR Secretary and then to the President, RA
7942 now provides for the creation of quasi-judicial bodies (POA and MAB) that
would have jurisdiction over conflicts arising from the applications and
mineral agreements. Secs. 77, 78, and 79
lay down the procedure, thus:
SEC. 77. Panel of Arbitrators.––There shall be a
panel of arbitrators in the regional office of the Department composed of three
(3) members, two (2) of whom must be members of the Philippine Bar in good
standing and one [1] licensed mining engineer or a professional in a related
field, and duly designated by the Secretary as recommended by the Mines and
Geosciences Bureau Director. Those
designated as members of the panel shall serve as such in addition to their
work in the Department without receiving any additional compensation. As much as practicable, said members shall
come from the different bureaus of the Department in the region. The presiding officer thereof shall be
selected by the drawing of lots. His
tenure as presiding officer shall be on a yearly basis. The members of the
panel shall perform their duties and obligations in hearing and deciding cases
until their designation is withdrawn or revoked by the Secretary. Within thirty (30) working days, after the
submission of the case by the parties for decision, the panel shall have
exclusive and original jurisdiction to hear and decide on the following:
(a) Disputes involving rights to mining areas;
(b) Disputes involving mineral agreements or
permits;
(c) Disputes
involving surface owners, occupants and claimholders/concessionaires;
and
(d) Disputes
pending before the Bureau and the Department at the date of the effectivity of this Act.
SEC. 78. Appellate Jurisdiction.—The decision or
order of the panel of arbitrators may be appealed by the party not satisfied
thereto to the Mines Adjudication Board within fifteen (15) days from receipt
thereof which must decide the case within thirty (30) days from submission
thereof for decision.
SEC. 79. Mines Adjudication Board.—The Mines
Adjudication Board shall be composed of three (3) members. The Secretary shall
be the chairman with the Director of the Mines and Geosciences Bureau and the
Undersecretary for Operations of the Department as members thereof.
x x x x
A petition for review by certiorari and
question of law may be filed by the aggrieved party with the Supreme Court
within thirty (30) days from receipt of the order or decision of the Board.
RA 7942
is also silent as to who is empowered to cancel existing lease contracts and
mineral agreements.
Meanwhile,
in Southeast Mindanao Gold Mining Corp. v. MAB, we
explained that the decision of the MAB can first be appealed, via a petition
for review, to the CA before elevating the case to this Court.[46]
After a
scrutiny of the provisions of PD 463, EO 211, EO 279, RA 7942 and its
implementing rules and regulations, executive issuances, and case law, we rule
that the DENR Secretary, not the POA, has the jurisdiction to cancel existing
mineral lease contracts or mineral agreements based on the following reasons:
1. The
power of the DENR Secretary to cancel mineral agreements emanates from his
administrative authority, supervision, management, and control over mineral
resources under Chapter I, Title XIV of Book IV of the Revised Administrative
Code of 1987, viz:
Chapter 1—General Provisions
Section 1. Declaration of Policy.—(1) The State shall ensure, for the benefit of the Filipino people, the full exploration and development as well as the judicious disposition, utilization, management, renewal and conservation of the country’s forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other natural resources x x x
Sec. 2. Mandate.—(1)
The Department of Environment and
Natural Resources shall be primarily responsible for the implementation of the
foregoing policy. (2) It shall,
subject to law and higher authority, be in charge of carrying out the State’s
constitutional mandate to control and supervise the exploration, development,
utilization, and conservation of the country’s natural resources.
x x x x
Sec. 4. Powers and Functions.—The Department shall:
x x x x
(2) Formulate, implement and supervise the implementation of the government’s policies, plans, and programs pertaining to the management, conservation, development, use and replenishment of the country’s natural resources;
x x x x
(4) Exercise supervision and control over forest lands, alienable and disposable public lands, mineral resources x x x
x x x x
(12) Regulate the development, disposition, extraction, exploration and use of the country’s forest, land, water and mineral resources;
(13) Assume responsibility for the assessment, development, protection, licensing and regulation as provided for by law, where applicable, of all energy and natural resources; the regulation and monitoring of service contractors, licensees, lessees, and permit for the extraction, exploration, development and use of natural resources products; x x x
x x x x
(15) Exercise exclusive jurisdiction on the management and disposition of all lands of the public domain x x x
Chapter 2—The Department Proper
x x x x
Sec. 8. The Secretary.—The Secretary shall:
x x x x
(3) Promulgate rules, regulations and other issuances necessary in carrying out the Department’s mandate, objectives, policies, plans, programs and projects.
(4) Exercise supervision and control over all functions and activities of the Department;
(5) Delegate authority for the performance of any administrative or substantive function to subordinate officials of the Department x x x (Emphasis supplied.)
It is the
DENR, through the Secretary, that manages, supervises, and regulates the use
and development of all mineral resources of the country. It has exclusive jurisdiction over the
management of all lands of public domain, which covers mineral resources and
deposits from said lands. It has the
power to oversee, supervise, and police our natural resources which include
mineral resources. Derived from the
broad and explicit powers of the DENR and its Secretary under the
Administrative Code of 1987 is the power to approve mineral agreements and necessarily
to cancel or cause to cancel said agreements.
2. RA 7942 confers to the DENR Secretary specific
authority over mineral resources.
Secs. 8
and 29 of RA 7942 pertinently provide:
SEC.
8. Authority of the Department.––The
Department shall be the primary government agency responsible for the
conservation, management, development, and proper use of the States mineral
resources including those in reservations, watershed areas, and lands of the
public domain. The Secretary shall
have the authority to enter into mineral agreements on behalf of the Government
upon the recommendation of the Director, promulgate such rules and regulations
as may be necessary to implement the intent and provisions of this Act.
SEC. 29. Filing and approval of Mineral Agreements.––x
x x.
The
filing of a proposal for a mineral agreement shall give the proponent the prior
right to areas covered by the same. The proposed mineral agreement will be
approved by the Secretary and copies thereof shall be submitted to the
President. Thereafter, the President shall provide a list to Congress of every
approved mineral agreement within thirty (30) days from its approval by the
Secretary. (Emphasis supplied.)
Sec. 29
is a carry over of Sec. 40 of PD 463 which granted jurisdiction to the DENR
Secretary to approve mining lease contracts on behalf of the government, thus:
SEC. 40. Issuance
of Mining Lease Contract.––If no adverse claim is filed within fifteen (15)
days after the first date of publication, it shall be conclusively presumed
that no such adverse claim exists and thereafter no objection from third
parties to the grant of the lease shall be heard, except protest pending at the
time of publication, and the Secretary shall approve and issue the
corresponding mining lease x x x.
To enforce PD 463, the CMAO containing the rules and
regulations implementing PD 463 was issued.
Sec. 44 of the CMAO provides:
SEC. 44.
Procedure for Cancellation.––Before any mining lease contract is
cancelled for any cause enumerated in Section 43 above, the mining lessee shall
first be notified in writing of such cause or causes, and shall be given an
opportunity to be heard, and to show cause why the lease shall not be
cancelled.
If,
upon investigation, the Secretary shall find the lessee to be in default,
the former may warn the lessee, suspend his operations or cancel the lease
contract (emphasis supplied).
Sec. 4
of EO 279 provided that the provisions of PD 463 and its implementing rules and
regulations, not inconsistent with the executive order, continue in force and
effect.
When RA
7942 took effect on March 3, 1995, there was no provision on who could cancel
mineral agreements. However, since the
aforequoted Sec. 44 of the CMAO implementing PD 463 was not repealed by RA 7942
and DENR AO 96-40, not being contrary to any of the provisions in them, then it
follows that Sec. 44 serves as basis for the DENR Secretary’s authority to
cancel mineral agreements.
Since
the DENR Secretary had the power to approve and cancel mineral agreements under
PD 463, and the power to cancel them under the CMAO implementing PD 463, EO 211,
and EO 279, then there was no recall of the power of the DENR Secretary under
RA 7942. Historically, the DENR
Secretary has the express power to approve mineral agreements or contracts and
the implied power to cancel said agreements.
It is a well-established principle that in the
interpretation of an ambiguous provision of law, the history of the enactment
of the law may be used as an extrinsic aid to determine the import of the legal
provision or the law.[47] History of the enactment of the statute constitutes
prior laws on the same subject matter. Legislative history necessitates review
of “the origin, antecedents and derivation” of the law in question to discover
the legislative purpose or intent.[48]
It can be assumed “that the new legislation has been enacted as continuation of
the existing legislative policy or as a new effort to perpetuate it or further
advance it.”[49]
We
rule, therefore, that based on the grant of implied power to terminate mining
or mineral contracts under previous laws or executive issuances like PD 463, EO
211, and EO 279, RA 7942 should be construed as a continuation of the
legislative intent to authorize the DENR Secretary to cancel mineral agreements
on account of violations of the terms and conditions thereof.
3. Under RA 7942, the power of control and
supervision of the DENR Secretary over the MGB to cancel or recommend
cancellation of mineral rights clearly demonstrates the authority of the DENR
Secretary to cancel or approve the cancellation of mineral agreements.
Under Sec. 9 of RA 7942, the MGB was
given the power of direct supervision of mineral lands and resources, thus:
Sec. 9. Authority of the Bureau.—The Bureau shall have direct charge in the administration and disposition of mineral lands and mineral resources and shall undertake geological, mining, metallurgical, chemical, and other researches as well as geological and mineral exploration surveys. The Director shall recommend to the Secretary the granting of mineral agreements to duly qualified persons and shall monitor the compliance by the contractor of the terms and conditions of the mineral agreements. The Bureau may confiscate surety, performance and guaranty bonds posted through an order to be promulgated by the Director. The Director may deputize, when necessary, any member or unit of the Philippine National Police, barangay, duly registered nongovernmental organization (NGO) or any qualified person to police all mining activities. (Emphasis supplied.)
Corollary
to the power of the MGB Director to recommend approval of mineral agreements is
his power to cancel or recommend cancellation of mining rights covered by said
agreements under Sec. 7 of DENR AO 96-40, containing the revised Implementing
Rules and Regulations of RA 7942. Sec. 7
reads:
Sec. 7. Organization and Authority of the Bureau.
x x x x
The Bureau shall have the following authority, among others:
a. To have direct charge in the administration and disposition of mineral land and mineral resources;
x x x x
d. To recommend to the Secretary the granting of mineral agreements or to endorse to the Secretary for action by the President the grant of FTAAs [Financial and Technical Assistance Agreements], in favor of qualified persons and to monitor compliance by the Contractor with the terms and conditions of the mineral agreements and FTAAs.
e. To cancel or to recommend cancellation after due process, mining rights, mining applications and mining claims for non-compliance with pertinent laws, rules and regulations.
It is
explicit from the foregoing provision that the DENR Secretary has the authority
to cancel mineral agreements based on the recommendation of the MGB
Director. As a matter of fact, the power
to cancel mining rights can even be delegated by the DENR Secretary to the MGB Director. Clearly, it is the Secretary, not the POA,
that has authority and jurisdiction over cancellation of existing mining
contracts or mineral agreements.
4. The DENR Secretary’s power to cancel
mining rights or agreements through the MGB can be inferred from Sec. 230,
Chapter XXIV of DENR AO 96-40 on cancellation, revocation, and termination of a
permit/mineral agreement/FTAA. Sec. 230
provides:
Section 230. Grounds
The following
grounds for cancellation revocation and termination of a Mining Permit Mineral
Agreement/FTAA.
a. Violation of
any of the terms and conditions of the Permits or Agreements;
b. Nonpayment of
taxes and fees due the government for two (2) consecutive years; and
c. Falsehood or
omission of facts in the application for exploration [or Mining] Permit Mineral
Agreement/FTAA or other permits which may later, change or affect substantially
the facts set forth in said statements.
Though Sec. 230 is silent as to who
can order the cancellation, revocation, and termination of a permit/mineral
agreement/FTAA, it has to be correlated with the power of the MGB under Sec. 7
of AO 96-40 “to cancel or to recommend cancellation, after due process, mining
rights, mining applications and mining claims for noncompliance with pertinent
laws, rules and regulations.” As the MGB
is under the supervision of the DENR Secretary, then the logical conclusion is
that it is the DENR Secretary who can cancel the mineral agreements and not the
POA nor the MAB.
5.
Celestial and
Whenever the LESSEE fails to comply with any provision of [PD
463, and] Commonwealth Acts Nos. 137, 466 and 470, [both as amended,] and/or
the rules and regulations promulgated thereunder, or any of the covenants
therein, the LESSOR may declare this lease cancelled and, after having
given thirty (30) days’ notice in writing to the LESSEE, may enter and take
possession of the said premises, and said lessee shall be liable for all unpaid
rentals, royalties and taxes due the Government on the lease up to the time of
the forfeiture or cancellation, in which event, the LESSEE hereby covenants and
agrees to give up the possession of the property leased. (Emphasis supplied.)
Thus, the government represented by
the then Secretary of Agriculture and Natural Resources (now the DENR
Secretary) has the power to cancel the lease contracts for violations of
existing laws, rules and regulations and the terms and conditions of the
contracts. Celestial and
However, Celestial and
This
postulation is incorrect.
Sec.
77 of RA 7942 lays down the jurisdiction of POA, to wit:
Within thirty (30) days, after the
submission of the case by the parties for the decision, the panel shall have
exclusive and original jurisdiction to hear and decide the following:
(a)
Disputes involving rights to mining areas
(b)
Disputes involving mineral agreements or permits
The
phrase “disputes involving rights to mining areas” refers to any adverse claim,
protest, or opposition to an application for mineral agreement. The POA
therefore has the jurisdiction to resolve any adverse claim, protest, or
opposition to a pending application for a mineral agreement filed with the
concerned Regional Office of the MGB.
This is clear from Secs. 38 and 41 of DENR AO 96-40, which provide:
Sec. 38.
x
x x x
Within thirty
(30) calendar days from the last date of publication/posting/radio
announcements, the authorized officer(s) of the concerned office(s) shall issue
a certification(s) that the publication/posting/radio announcement have been
complied with. Any adverse claim, protest or opposition shall be filed directly,
within thirty (30) calendar days from the last date of publication/posting/radio
announcement, with the concerned Regional Office or through any concerned PENRO
or CENRO for filing in the concerned Regional Office for purposes of its
resolution by the Panel of Arbitrators pursuant to the provisions of this Act
and these implementing rules and regulations.
Upon final resolution of any adverse claim, protest or opposition, the
Panel of Arbitrators shall likewise issue a certification to that effect within
five (5) working days from the date of finality of resolution thereof. Where there is no adverse claim, protest or
opposition, the Panel of Arbitrators shall likewise issue a Certification to
that effect within five working days therefrom.
x
x x x
No Mineral Agreement shall be approved unless
the requirements under this Section are fully complied with and any adverse
claim/protest/opposition is finally resolved by the Panel of Arbitrators.
Sec. 41.
x x x x
Within fifteen
(15) working days from the receipt of the Certification issued by the Panel of Arbitrators as provided in Section 38 hereof, the concerned Regional Director shall initially evaluate the Mineral
Agreement applications in areas outside Mineral reservations. He/She shall thereafter endorse his/her
findings to the Bureau for further evaluation by the Director within fifteen
(15) working days from receipt of forwarded documents. Thereafter, the Director shall endorse the
same to the secretary for consideration/approval within fifteen working days
from receipt of such endorsement.
In case of Mineral Agreement applications in areas with Mineral
Reservations, within fifteen (15) working days from receipt of the
Certification issued by the Panel of Arbitrators as provided for in Section 38
hereof, the same shall be evaluated and endorsed by the Director to the
Secretary for consideration/approval within fifteen days from receipt of such
endorsement. (Emphasis supplied.)
It has been made clear from the aforecited
provisions that the “disputes involving rights to mining areas” under Sec.
77(a) specifically refer only to those disputes relative to the applications
for a mineral agreement or conferment of mining rights.
The
jurisdiction of the POA over adverse claims, protest, or oppositions to a
mining right application is further elucidated by Secs. 219 and 43 of DENR AO
95-936, which read:
Sec. 219. Filing of Adverse
Claims/Conflicts/Oppositions.—Notwithstanding the provisions of Sections
28, 43 and 57 above, any adverse claim, protest or opposition specified in
said sections may also be filed directly with the Panel of Arbitrators
within the concerned periods for filing such claim, protest or opposition as
specified in said Sections.
Sec. 43. Publication/Posting of
Mineral Agreement Application.—
x x x x
The Regional Director or concerned
Regional Director shall also cause the posting of the application on the
bulletin boards of the Bureau, concerned Regional office(s) and in the
concerned province(s) and municipality(ies), copy furnished the barangays where
the proposed contract area is located once a week for two (2) consecutive weeks
in a language generally understood in the locality. After forty-five (45) days from the last date
of publication/posting has been made and no adverse claim, protest or
opposition was filed within the said forty-five (45) days, the concerned
offices shall issue a certification that publication/posting has been made and
that no adverse claim, protest or opposition of whatever nature has been
filed. On the other hand, if there be
any adverse claim, protest or opposition, the same shall be filed within
forty-five (45) days from the last date of publication/posting, with the
Regional Offices concerned, or through the Department’s Community Environment
and Natural Resources Officers (CENRO) or Provincial Environment and Natural Resources
Officers (PENRO), to be filed at the Regional Office for resolution of the
Panel of Arbitrators. However previously published valid and subsisting
mining claims are exempted from posted/posting required under this Section.
No mineral
agreement shall be approved unless the requirements under this section are
fully complied with and any opposition/adverse claim is dealt with in writing
by the Director and resolved by the Panel of Arbitrators. (Emphasis supplied.)
These provisions lead us to conclude that the power
of the POA to resolve any adverse claim, opposition, or protest relative to
mining rights under Sec. 77(a) of RA 7942 is confined only to adverse claims,
conflicts and oppositions relating to applications for the grant of
mineral rights. POA’s jurisdiction is
confined only to resolutions of such adverse claims, conflicts and oppositions
and it has no authority to approve or reject said applications. Such power is vested in the DENR Secretary
upon recommendation of the MGB Director.
Clearly, POA’s jurisdiction over “disputes involving rights to mining
areas” has nothing to do with the cancellation of existing mineral agreements.
On the other hand, Celestial and Blue Ridge contend
that POA has jurisdiction over their petitions for the cancellation of
Macroasia’s lease agreements banking on POA’s jurisdiction over “disputes
involving mineral agreements or permits” under Sec. 77 (b) of RA 7942.
Such position is bereft of merit.
As earlier discussed, the DENR
Secretary, by virtue of his powers as administrative head of his department in
charge of the management and supervision of the natural resources of the
country under the 1987 Administrative Code, RA 7942, and other laws, rules, and
regulations, can cancel a mineral agreement for violation of its terms, even
without a petition or request filed for its cancellation, provided there is
compliance with due process. Since the cancellation of the mineral agreement is
approved by the DENR Secretary, then the recourse of the contractor is to elevate
the matter to the OP pursuant to AO 18, Series of 1987 but not with the
POA.
Matched with the legal provisions
empowering the DENR Secretary to cancel a mineral agreement is Sec. 77 (b) of
RA 7942 which grants POA jurisdiction over disputes involving mineral
agreements.
A dispute is defined as “a conflict or controversy; a
conflict of claims or rights; an assertion of a right, claim or demand on one
side; met by contrary claims or allegations on the other.”[51] It is synonymous to a cause of action which
is “an act or omission by which a party violates a right of another.”[52]
A
petition or complaint originating from a dispute can be filed or initiated only
by a real party-in-interest. The rules
of court define a real party-in-interest as “the party who stands to be
benefited or injured by the judgment in the suit or the party entitled to the
avails of the suit.”[53] Every action, therefore, can only be
prosecuted in the name of the real party-in-interest.[54] It has been explained that “a real party-in-interest
plaintiff is one who has a legal right, while a real
party-in-interest-defendant is one who has a correlative legal obligation whose
act or omission violates the legal right of the former.”[55]
On
the other hand, interest “means material interest, an interest in issue and to
be affected by the decree, as distinguished from mere interest in the question
involved, or a mere incidental interest.”
It is settled in this jurisdiction that “one having no right or interest
to protect cannot invoke the jurisdiction of the court as a party-plaintiff in
an action.”[56] Real interest is defined as “a present
substantial interest, as distinguished from a mere expectancy, or a future,
contingent, subordinate or consequential interest.”[57]
From the foregoing, a petition for the cancellation of an
existing mineral agreement covering an area applied for by an applicant based
on the alleged violation of any of the terms thereof, is not a “dispute”
involving a mineral agreement under Sec. 77 (b) of RA 7942. It does not pertain to a violation by a party
of the right of another. The applicant
is not a real party-in-interest as he does not have a material or substantial
interest in the mineral agreement but only a prospective or expectant right or
interest in the mining area. He has no
legal right to such mining claim and hence no dispute can arise between the
applicant and the parties to the mineral agreement. The court rules therefore that a petition for
cancellation of a mineral agreement anchored on the breach thereof even if filed
by an applicant to a mining claim, like Celestial and Blue Ridge, falls within
the jurisdiction of the DENR Secretary and not POA. Such petition is excluded from the coverage
of the POA’s jurisdiction over disputes involving mineral agreements under Sec.
77 (b) of RA 7942.
Macroasia not estopped from raising the issue of
jurisdiction on appeal
On the
related issue of estoppel, petitioner Celestial argues that Macroasia is
estopped from raising and questioning the issue of the jurisdiction of the POA
and MAB over the petition for cancellation of its mining lease contracts, when
Macroasia raised it only in its Supplemental Motion for Reconsideration.
We rule
that the principle of estoppel does not apply.
Indeed,
Macroasia was not the one that initiated the instant case before the POA, and
thus was not the one that invoked the jurisdiction of the POA. Hence, on appeal, Macroasia is not precluded
from raising the issue of jurisdiction as it may be invoked even on appeal.[58] As a matter of fact, a party can raise the
issue of jurisdiction at any stage of the proceedings.
Petitioner
Celestial’s reliance on Villela v. Gozun[59]
to support the contention that the POA has jurisdiction to hear and decide a
petition to cancel existing mining lease contracts, is misplaced. In said case, we dismissed the petition on
the ground of non-exhaustion of administrative remedies and disregarded
judicial hierarchy as no compelling reason was shown to warrant otherwise. While we pointed out the authority of the POA,
there was no categorical pronouncement on the jurisdictional issue.
No valid pronouncement of abandonment due to
lack of jurisdiction over petition to cancel
As we
are not a trier of facts, we need not make any finding on the various
investigations done by the MGB and MAB on the issue of Macroasia’s
non-compliance with its work obligations and nonpayment of taxes and fees. Verily, the law does not impose automatic
cancellation of an existing mining lease contract, as it is a question of fact
which must be determined by the MGB which can recommend the cancellation of the
mineral or lease agreements to the DENR Secretary. Be that as it may, since the POA and MAB have
no jurisdiction over the petition for cancellation of existing mining lease
contracts of Macroasia, they could not have made any binding pronouncement that
Macroasia had indeed abandoned the subject mining claims. Besides, it is the DENR Secretary who has the
authority to cancel Macroasia’s existing mining lease contracts whether on
grounds of abandonment or any valid grounds for cancellation.
Decision in CA-G.R. SP No. 90828 not in accord
with the law
With
our resolution of the issue on the lack of jurisdiction of the POA and the MAB
over petitions to cancel existing mining lease contracts or mineral agreements,
it is thus clear that the May 18, 2006 Decision in CA-G.R. SP No. 90828 must be
nullified for being not in accord with the law and the April 15, 2005 Decision
in CA-G.R. SP No. 87931 must be upheld.
Notwithstanding
the nullification of the
The
chronology of events reveals the following:
1.
2. April 15, 2005 – the CA through its
Twelfth Division rendered its Decision
in CA-G.R. SP No. 87931 affirming the November 26, 2004 MAB Resolution.
3.
4.
From
these facts, the CA Special Tenth Division should have ordered the
consolidation of the petition in CA-G.R. SP No. 90828 by CA-G.R. SP No. 87931 pursuant
to the Internal Rules of the CA, the latter having the earlier docket
number. Had it done so, then the
occurrence of the conflicting decisions could have been prevented. The CA Special Tenth Division should have
abided by our ruling in Nacuray v. NLRC, where we held, “Consequently, a
division cannot and should not review a case already passed upon by another
Division of this Court. It is only
proper, to allow the case to take its rest after having attained finality.”[60]
The CA
should take the appropriate steps, including the adoption or amendment of the
rules, to see to it that cases or petitions arising from the same questioned
decision, order, or resolution are consolidated to steer clear of contrary or
opposing decisions of the different CA Divisions and ensure that incidents of
similar nature will not be replicated.
G.R. No. 172936
No showing that the DENR Secretary gravely abused his discretion
Now, going to the substance of the petition in G.R. No. 172936. A
scrutiny of the records shows that the DENR Secretary did not gravely abuse his
discretion in approving and signing MPSA Nos. 220-2005-IVB and 221-2005-IVB in favor of Macroasia.
Petitioner
The October 24, 2000 MAB Decision,
nullified by the subsequent
Moreover, a preferential right would
at most be an inchoate right to be given priority in the grant of a mining
agreement. It has not yet been transformed into a legal and vested right unless
approved by the MGB or DENR Secretary.
Even if Blue Ridge has a preferential right over the subject mining
claims, it is still within the competence and discretion of the DENR Secretary
to grant mineral agreements to whomever he deems best to pursue the mining
claims over and above the preferential status given to
The DENR Secretary has full discretion in the grant of
mineral agreements
We are not persuaded.
Blue Ridge cites Sec. 38 (not Sec.
36) of DENR AO 96-40 as basis for claiming that then DENR Secretary Defensor
committed grave abuse of discretion in granting MPSA Nos. 220-2005-IVB and
221-2005-IVB to Macroasia. Petitioner’s
postulation cannot be entertained for the reason that the issuance of the
mining agreements was not raised before the MGB Director and DENR Secretary,
nor was it amply presented before the CA. There is even a counter-charge that
Primary jurisdiction of the DENR Secretary in determining whether to
grant or not a mineral agreement
Verily, RA 7942, similar to PD 463, confers exclusive and primary
jurisdiction on the DENR Secretary to approve mineral agreements, which is
purely an administrative function within the scope of his powers and
authority. In exercising such exclusive
primary jurisdiction, the DENR Secretary, through the MGB, has the best competence
to determine to whom mineral agreements are granted. Settled is the rule that the courts will
defer to the decisions of the administrative offices and agencies by reason of
their expertise and experience in the matters assigned to them pursuant to the
doctrine of primary jurisdiction.
Administrative decisions on matter within the jurisdiction of
administrative bodies are to be respected and can only be set aside on proof of
grave abuse of discretion, fraud, or error of law.[63] Unless it is shown that the then DENR
Secretary has acted in a wanton, whimsical, or oppressive manner, giving undue
advantage to a party or for an illegal consideration and similar reasons, this
Court cannot look into or review the wisdom of the exercise of such discretion.
Delineation of powers and functions is accorded the three branches of
government for the smooth functioning of the different governmental
services. We will not disturb nor
interfere in the exercise of purely administrative functions of the executive
branch absent a clear showing of grave abuse of discretion.
Without a restraining order or injunction, litigation will not deter
the DENR from exercising its functions
While it is true that the subject mining claims are under litigation,
this does not preclude the DENR and its Secretary from carrying out their
functions and duties without a restraining order or an injunctive writ. Otherwise, public interest and public service
would unduly suffer by mere litigation of particular issues where government
interests would be unduly affected. In
the instant case, it must be borne in mind that the government has a stake in
the subject mining claims. Also, Macroasia
had various valid existing mining lease contracts over the subject mining lode
claims issued by the DENR. Thus,
Macroasia has an advantage over
WHEREFORE, the petitions under G.R. Nos.
169080, 172936, and 176229 are DISMISSED
for lack of merit, while the petition under G.R. No. 176319 is
hereby GRANTED. The assailed
SO ORDERED.
PRESBITERO
J. VELASCO, JR.
Associate Justice
WE CONCUR:
LEONARDO A.
QUISUMBING
Associate Justice
Chairperson
CONCHITA
CARPIO MORALES DANTE
O. TINGA
Associate Justice Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
A T T E S T A T I O N
I attest that the conclusions in the
above Decision had been reached in consultation before the case was assigned to
the writer of the opinion of the Court’s Division.
LEONARDO A. QUISUMBING
Associate
Justice
Chairperson
C E R T I F
I C A T I O N
Pursuant to Section 13, Article VIII of the
Constitution, and the Division Chairperson’s Attestation, I certify that the
conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.
REYNATO S. PUNO
Chief Justice
[2]
[3]
[4] Rollo (G.R. No. 172936), pp. 3-53.
[5] Rollo (G.R. No. 176226), pp. 9-85, and rollo (G.R. No. 176319), pp. 14-77.
[6] Rollo
(G.R. No. 176226), pp. 87-108, and rollo (G.R. No. 176319), pp. 79-100.
Penned by Associate Justice Rosmari D. Carandang and concurred in by Associate
Justices Andres B. Reyes, Jr. (Chairperson) and
[7] Rollo (G.R. No. 176226), pp. 110-116, and rollo (G.R. No. 176319), pp. 102-108.
[8] Rollo (G.R. No. 172936), p. 700.
[9] Rollo (G.R. No. 176226), p. 1835.
[10] Rollo (G.R. No. 176319), pp. 1270-1271.
[11] Rollo (G.R. No. 169080), pp. 89-91.
[12]
[13]
[14]
Approved on
[15] “Providing for a Modernized System of Administration and Disposition of Mineral Lands and to Promote and Encourage the Development and Exploitation Thereof,” approved and became effective on May 17, 1974.
[16] G.R.
No. 85904,
[17] See
September 15, 1999 Memorandum from Task Force Team Leader Rolando Peña to the
Chairman of MAB, rollo (G.R. No. 169080), p. 494, on the Report by Task
Force Created to Investigate the Area Subject of MAB Case Nos. 056-97 and
057-97 at Brooke’s Point,
[18]
[19]
[20]
[21] Revised Implementing Rules and Regulations of RA 7942, otherwise known as the Philippine Mining Act of 1995, vice DENR AO 95-23, series of 1995.
[22] Rollo (G.R. No. 169080), pp. 297-308.
[23]
[24]
[25] Rollo
(G.R. No. 172936), pp. 437-447.
[26]
[27]
[28] Rollo
(G.R. No. 169080), pp. 372-403.
[29] Supra note 3.
[30] Supra note 1.
[31] Rollo (G.R. No. 169080), pp. 1203-1215.
[32]
[33] Supra note 4.
[34] Rollo (G.R. No. 176226), pp. 1687-1737.
[35] Supra note 5.
[36] Supra note 5.
[38] Supra note 4, at 28-29.
[40] Rollo (G.R. No. 176319), p. 15.
[47] Commissioner of Customs v. Esso Standard
Eastern, Inc., No. L-28329,
[50] Rollo (G.R. No. 169080), pp. 145-153.
[58] See
[59]
G.R. No. 158092,
[60]
G.R. Nos. 114924-27,
[61] Rollo (G.R. No. 169080), p. 240.
[62] Rollo (G.R. No. 172936), pp. 87-90.